The Woodlands - Archive - ULI

LOCATION• 1,343 Acre Quadrant developed Master Planned Community• Over 1,200 home sites already built with a town center and employment zone• Future 1,100 single family yet to come with a regional hospital• Significant Land Barriers to New Development – Severe land availability constraints• Strategic position to major employment and recreation centers• Within a 5 minute walk of retail/services/groceries.• 500 new jobs in Q1 2013 just ¼ mile away with the opening of Space Labs.THE WOODLANDS - Evergreen HousingDevelopment Group, LLC

PROJECT DESCRIPTION• 100 Best in Class LuxuryRental Townhomes• 1,220 – 1,420 Sq Ft• Proforma Rents$1,650 - $1,750• Avg rent/sqft $1.29• 30 – 2 Bed 2.5 Bath• 70 - 3 bed 2.5 Bath• Attached Garage plus onecovered parking space• 9’ ceilings, slab graniteeverywhere, etc• Pedestrian friendlycommunity designTHE WOODLANDS - Evergreen HousingDevelopment Group, LLC

TYPICAL FLOOR PLAN – 3 Bed 2.5 BathTHE WOODLANDS - Evergreen HousingDevelopment Group, LLC

TYPICAL FLOOR PLAN – 2 Bed 2.5 BathTHE WOODLANDS - Evergreen HousingDevelopment Group, LLC

MARKET DATA – BEST RENT COMPARABLEEcho Ridge Apartments$1.60/sqft rentsNameEcho RidgeManagement EssexAddress 34907 SE Kinsey St Snoqualmie, WA 98065Year Built 2000Total Units 120Occupancy 95%TH or Flat Style # Units Sqft Low Sqft High Rent Low Rent HighRentLow/SqftRentHigh/SqftFlat 1x1 676 775 $1,307 $1,349 $1.93 $1.74Flat 2x1 914 1093 $1,544 $1,646 $1.69 $1.51Flat 2x2 1005 1257 $1,627 $1,819 $1.62 $1.45Flat 3x2 1284 1346 $1,763 $2,059 $1.37 $1.53Average $1.60THE WOODLANDS - Evergreen HousingDevelopment Group, LLC

FINANCIAL METRICSLand $3,000,000Construction Hard Costs($100/nrsf) $13,475,000Soft Costs $1,650,000PE/Mezz Interest and Fees $525,000Total Costs($139/nrsf) $18,650,000Construction Loan at 75% of hardand soft costPE/Mezz at 15% of hard and softcost (Plus PE/Mezz 12 monthInterest and Fees)Evergreen Equity at 10% of hardand soft cost$13,580,000$3,200,000$1,870,000Total Sources $18,650,000Untrended Income $2,037,000Untrended Expenses $560,000Untrended NOI $1,477,000Construction Interest @4.5% $611,000PE/Mezz Interest $453,000Cash Flow $413,000Underwritten Value (5.5 CAP) $26,850,000Going In CAP 8.16%Going in Margin $8,750,0003-Year IRR Unleveraged 21%Total Debt to Value 62%Construction Loan to Value 50%Margin as % of Cost 48%THE WOODLANDS - Evergreen HousingDevelopment Group, LLC

FINANCIAL METRICS (cont.)The Preferred Equity/Mezz Debt willbe repaid in Year 3 (2016) through anew permanent loan or a sale of thecommunity.Year 3 Perm Loan Assumption (2016)LTV 70%DSRC 1.25Underwriting Rate 6.00%Amortization30 YearsPerm Loan Amount $17,260,000Repay Construction Debt -$13,475,000Repay PE/Mezz -$3,200,000Net Proceeds $585,000Year 3 Sale Assumption (2016)NOI (Trended) $1,552,291CAP 5.50%CAP Value 28,000,000Cost of Sale -$1,130,000Construction Loan Balance -$13,475,000Repay PE/Mezz -$3,200,000Net Proceeds $10,195,000THE WOODLANDS - Evergreen HousingDevelopment Group, LLC

EVERGREEN HOUSING DEVELOPMENT GROUP, LLCFounded in 2005• Conservative firm seeking Preferred Equity/Mezz Debt Capital Partner to expandmarket rate apartment development and construction• $90,000,000 Current Portfolio of Evergreen Developed Product:• 228 units of market rate housing• 532 units of LIHTC affordable housing• Integrated 6 person team – Development and Construction, CPA on Staff• Experienced with Institutional Level of Due Diligence and Operations• Steady, measured multifamily development growth• Consistent best in class design and specification• Best in market 3 rd party professional management• Select suburban Pacific North West locations with land constraints.• 1 st Tier City suburban neighborhoods• 2 nd Tier Cities with strong performing marketsTHE WOODLANDS - Evergreen HousingDevelopment Group, LLC

WOODLANDS PROJECT REQUEST• $3,200,000 PE/Mezz Request• April 2013 Funding 3 Year Term, 14%, 2 pointsFUTURE EVERGREEN OPPORTUNITY• June 2013 $4,000,000 PE/Mezz on a new 228 unit Stabilized LuxuryApartment Community in Richland, WA• June 2013 $3,000,000 Funding on suburban Portland Oregon Project• Long term relationship sought to fund $10,000,000 to $20,000,000 a Year ofPreferred Equity/Mezz DebtTHE WOODLANDS - Evergreen HousingDevelopment Group, LLC