Hi Rich,

I wanted to start out by thanking you for taking the time to negotiate and broker this deal. To my understanding we signed a deal on our Pico property in June of 2010.

Fred asked me to look at the market regarding this particular matter. I can honestly say by looking at the data in this area and the broader economy in general. Giving we are currently in a down market. I do not see any indicators that point to an increase in rental demand justifying an increase in rent. Does Mr. Sidley have someone interested in leasing the building?

This was the cover story for CNN money today. Granted it does not spell out everything for Los Angeles. And these are homes. But the same economic fundamentals are there. Real Estate Prices to Go Lower in 2013

There has been very little growth overall in the past couple of years. And more than anything we are at the beginning of a verifiable retractive phase. And the last few quarters show retraction.

Our original rent was around $6,100. Once we pay electric and for the security guard it goes up to $6,600. That increase of around $300 came only a few months ago.

Your deal of $6,600 would bring our monthly liability to $7,100. Gary Jacobson is already asking for an additional $200. And in the midst of a down market. If we are going strictly by the data, and considering the ramifications of what will likely be increased taxes I think prices are going to actually fall in the future.