Is SIDA funding necessary?
In reaching its conclusion that Pyramid cannot carry out the expansion without bond funding from SIDA, Deloitte relied in part on the developer’s financial projections for the project. On the basis of those projections, Deloitte found that, without the bond funding, the return on equity would be an unacceptable 2.5%, and that, with SIDA’s bond funding, the return would be 7.7% (pp. 61-62). Deloitte did not challenge Pyramid’s financial projections. However, certain critical numbers raise serious questions. The first troubling item is gross revenues, or total operating receipts, for the fully expanded center. Citing Pyramid’s data, Deloitte reports that gross revenues “are projected to be in the $20.00 per square foot range, but reflect the ‘lower decile’ ($17.98/sq. ft.) for super-regional malls in the Northeast Region” (Executive Summary, p. 4). This means that, with SIDA funding, with all phases completed (making it the largest mall in America) and with being a major retail and touri
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