Financial Plan of the Project

The calculation of the financial plan of the Project was done proceeding from the supposed parameters of the model and allows estimating rental incomes and profits earn on the financial strategy.

The multipurpose trading-office center will be put into operation on the 28th month of the Project realization, after the finish date of an "investment" stage.

Within the first eight months the percent of office spaces loading will be up at the level of 70 (the advertizing company is supposed to start half a year before opening). After that period Project strategy provides increase of loading and achievement of planned level of loading of 98 %.

Taking into consideration preliminary arrangements existing at present time and the big interest in placing a car dealership and a car-care center in the retail and office complex, and also a prospective high demand of a panoramic floor, the loading of these premises is supposed to be full from the very beginning.

As a result the general planned square of tenements under the Project will amount to 15,7 thousand sq.m.

Planned rental rates may vary from 210 to 480 Euros a year for square meter. In the considered basic model the following rates are accepted:

• For a car dealership, a car-care center and an auto parts shop – 300 Euros for 1 sq.m.;

• For catering facilities – 250 Euros;

• For office areas (from 3th to 4th floors) - 480 Euros;

• For prestigious 5th floor - 500 euro.

Monthly rental price of a parking slot is 100 Euros.

In the process of the Project realization the tenancy income increases and reaches the sum of 534 thousand euro by the fourth year.

As a result, at given parameters of prices, loading probability and realization of the planned investments and actions the annual receipts exclusive of VAT will make about 5,4 million euro.

Budgeted revenue under the Project is summarized in the Table № 4.

The expense side of the Project represents a classical cost structure of a business center.

Estimation of operational expenses takes into account all the expenses connected with the maintenance of the building and the adjoining territory. The monthly sum of these expenses totals from 63 thousand to 98 thousand euro and consists of the following cost items:

• Heating – 8 423 Euros;

• Water supply – from 531 to 548 Euros;

• Sewerage – from 581 to 600 Euros;

• Electric supply – from 14 125 to 14 596 Euros;

• Communication services – 2 430 Euros;

• Garbage disposal – from 1 347 to 1 392 Euros;

• All-in one cleaning of the premise – 257 625 Euros;

• Cleaning of adjoining territories – 5 005 Euros;

• Windows and faces cleaning – 20 836 Euros (to be carried out every 6 months);

• Object protection – 11 412 Euros;

• Staff salaries – 4 000 Euros;

• Consumable materials for exploitation – 2 000 Euros;

• Planned expenses on operating repairs – 844 Euros (since 48th month of the Project realization);

• Miscellaneous costs – from 1 700 to 2 325 Euros.

It should be noted that almost all maintenance costs are regular.

Management expenses are provided from 1st month and account for 7 560 Euros monthly (labor compensation fund of management board). From the 22nd month management expenses grow at the cost of advertizing expenses (5,000 Euros a month). And from the date of complex` input into operation (28th month) and till the end of the Project consideration the monthly sum of the expenses will be within the bounds of 23 706 to 62 524 Euros, reaching its maximum value in the months of land lease payments quarter sum of which totals 38 818 Euros. In addition, the structure of management expenses involves:

• Staff salaries, except management – 9 324 Euros;

• Expenses for audit services – 300 Euros;

• Expenses for consulting services – 300 Euros;

• Transport expenses – 1 000 Euros;

• Insurance;

• Banking commission – from 222 to 267 Euros.

Annual expenses for the retail and office centre during all period of consideration of the Project are summarized in Table 4.

Table 4. Budgeted revenues and costs of the Project, in Euro (exclusive of VAT).

Revenue	1^st year	2^nd year	3^rd year	4^th year	5^th year	6^th year	7^th year	8^th year
Earnings from space letting	0	0	3 386 294	5 429 947	5 429 947	5 429 947	5 429 947	5 429 947
Earnings from space sales	0	0	0	0	0	0	0	0
Miscellaneous costs	0	0	0	0	0	0	0	0
TOTAL REVENUE:	0	0	3 386 294	5 429 947	5 429 947	5 429 947	5 429 947	5 429 947
Expenses	1^st year	2^nd year	3^rd year	4^th year	5^th year	6^th year	7^th year	8^th year
Operational expenses, including:	0	0	520 290	705 070	712 935	712 935	712 935	691 171
Heating	0	0	64 246	85 661	85 661	85 661	85 661	85 661
Water supply	0	0	4 121	5 470	5 470	5 470	5 470	5 410
Sewerage	0	0	4 512	5 988	5 988	5 988	5 988	5 922
Electrical supply	0	0	109 726	145 636	145 636	145 636	145 636	144 040
Communication (phone) services	0	0	18 534	24 712	24 712	24 712	24 712	24 712
Garbage disposal	0	0	10 467	13 892	13 892	13 892	13 892	13 740
All-in one cleaning of the premise	0	0	68 945	91 927	91 927	91 927	91 927	91 927
Cleaning of adjoining territories (incl.snow clearing)	0	0	38 177	50 903	50 903	50 903	50 903	50 903
Windows and faces cleaning	0	0	17 658	35 315	35 315	35 315	35 315	17 658
Other housekeeping works	0	0	0	0	0	0	0	0
Protection of the Object	0	0	109 902	145 870	145 870	145 870	145 870	144 271
Labor compensation fund	0	0	45 360	60 480	60 480	60 480	60 480	60 480
Consumable materials for exploitation	0	0	15 254	20 339	20 339	20 339	20 339	20 339
Expenses for current repairs	0	0	0	715	8 581	8 581	8 581	8 581
Other expenses	0	0	13 389	18 161	18 161	18 161	18 161	17 527
Managerial expenses, including	113 400	126 112	331 029	353 182	353 182	353 182	353 182	353 182
Land lease	0	0	98 691	131 588	131 588	131 588	131 588	131 588
Labor compensation fund	113 400	113 400	180 306	202 608	202 608	202 608	202 608	202 608
Advertizing expenses	0	12 712	38 136	0	0	0	0	0
Audit services	0	0	2 288	3 051	3 051	3 051	3 051	3 051
Consulting services	0	0	2 288	3 051	3 051	3 051	3 051	3 051
Transport expenses	0	0	7 627	10 169	10 169	10 169	10 169	10 169
Insurance	0	0	0	0	0	0	0	0
Banking commission	0	0	1 693	2 715	2 715	2 715	2 715	2 715
Other	0	0	0	0	0	0	0	0
Other payments	0	0	0	0	0	0	0	0
Amortization	0	0	169 407	221 962	217 570	213 266	209 046	204 910
Interests on loans and credits	256 350	959 716	1 513 192	1 221 617	851 446	523 390	171 174	0
Current taxes (included to prime cost)	0	0	186 347	244 158	239 327	234 592	229 951	225 401
TOTAL EXPENSES:	483 150	1 211 940	3 571 584	3 804 240	3 440 578	3 103 483	2 742 405	2 519 018
Gross profit	-483 150	-1 211 940	-185 290	1 625 707	1 989 369	2 326 464	2 687 542	2 910 929