From: Michael Gargano To: Jeffrey Epstein <jeevacatioMkgmail.com> CC: "Anthony Barrett ( )" < Subject: RE: Culver Studios Date: Fri, 01 Nov 2013 00:04:00 +0000 ok--thanks for letting us know. From: Jeffrey Epstein peevacation®gmail.com] Sent: Thursday, October 31, 2013 5:02 PM To: Michael Gargano Subject: Re: Culver Studios I spoke to my holloywood contacts and the place has a repuaion of being nm down and a bit yesterday, I will pass On Thu, Oct 31, 2013 at 8:00 PM, Michael Gargano < > wrote: Toured the property today. It obviously depends on the final price, which may get bid up, but in the $80M range I think it is an attractive acquisition. As we originally discussed, it is an impressively large piece of cash flowing property in a great location. Since the tour, my contact at Fox has been trying to reach me and left a VM saying that Fox very much wants to take considerable amounts of space. I won't have specifics until I speak with her. Jeffrey - just let us know if you still want to do this, so if you don't, we will speak to other capital sources. And no worries if you decide against it doing it. As we have discussed, it is a very hands on business. Here are my latest observations based on the tour and some other due diligence conversations I have had with contacts in the industry. 1. Downside. The studio has been poorly operated. Neither Fox nor Sony which are nearby and need space will consider going to Culver under current management. Based on the studio's operating history, the current $4.7M NOI is low and we believe it can be increased substantially but not to the peak $12M levels. We expect $8M is readily achievable and it is possible to get there with Fox alone. 2. Macro Issues. Other states have been competing against California for film shoots and that has hurt the local studio business. However, some of the competing tax credit programs are coming under attack in those states for being an ineffective use of taxpayer dollars