1  Review last meeting Action Items

 
• John has set up a meeting with PVL and Astro Builders for the 17th of Oct.  Tom and Jerry will represent us in that meeting (Done)
• See the action item list for other outstanding action items.

2  Reports
2.1  Negotiation with Pacific Ave (SF) Developers

 
• We reached agreement on the overall budget and Pacific agree to the change on the insurance terms.  But we could not close on the detailed timeline.  There is a gap of 6 weeks.
• The next meeting is set to go on 10/16/06.  Ed and Ruldolf attend.

2.2  Progress of Austin TX project

 
• Site manager Allen reported that the Austin Project is meeting our planned timeline.  Machinery has arrived ontime.
• Major risk is failing to get the Fire Dept inspection and approval before Nov 10 which will impact the openning date in Thanksgiving.  Allen is working 100% to fix that.  (see Action Item 1 below)

2.3  Oakland Office Manager hiring

 
• We have gotten over 100 applications for the position.  After phone interviews we have selected 4 candidates for the first interview.  We are now down to two candidates.  Both have over 10 years experience in real estate office/project management.  One has an MBA from Duke University.
• We will make a decision after Tom and Jerry had a chance to meet them next week.  (see Action Item 2 below)
  

2.4  Q3/Q4 financial report

 
• See attached Q3 financial report.  Total income for the quarter is $54,332,400.  Expense is $49,010,171.  Q3 net profit is up by 12% year-by-year.
• See attached Q4 financial projection.  Expected net profit for Q4 is $3.3M.  2007 Net profit total $18.5M, up by 8.3% compare to 2006.

3  Discussion Items
3.1  2007 Budget Review

 
• Ed presented the budget plan summary from various department heads.  The finance committee generally accepted the recommendation of working budgets.  The investment items has been reviewed by the executive committee and the summary report reflects the recommendations from the executive committee.
• The result has been communicated with the department heads before this meeting.
• Allen questions the cutback on investment on Austin TX.  He presented data (see attached PPT from Allen Q) to show that the necessary investments for the 4 commercial sites must increase by 15% in order to ensure the return due to an increase in raw material cost.
• The group decides to counter propose an increase of 7% in 2007 and another 8% increase in 2008.  The recommendation will be proposed to the executive committee for approval and final decision.  (See Decision Item 1 below)

3.2  Leasing of office space

 
• The new lease will add a total of 3,550 sq ft. space to our current San Ramon Office.  The current engineering office in the SF Headquarters will be moved to the San Ramon Office.  16 engineers and 2 managers will be impacted by the move.
• The lease is under review by our legal and is expected to enter by early Nov.
• The lease will start Jan 1, 2007.  Sandra S will coordinate the logistics and will report back in the next meeting.  (See Action Item 3 below)

4  Other Businesses

 
• Reviewed and approved this meeting's action items.
• Meeting adjourn at 11:55 AM.