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  • 1. Madison Realty Equities, LLC Track Record – Examples The following are examples of properties that Madison and its principals have managed over the past twenty years. Slate Creek Senior Apartments in Effingham, Illinois Since 1996, Madison has been the general partner, asset manager and property manager for this 113-unit senior apartment property. Madison has been able to maintain 99% occupancy of the property for the past 15 years and has caused the refinancing of the property two times since 1996 and has returned over 200% of the investors original $1,500,000 of equity capital. Annual cash flows remain 8% each year on the original equity invested. Otsego Senior Housing Partners in Michigan Madison has been the general partner, asset manager and property manager for this 120unit senior apartment property since 1996. Madison has been able to maintain 99% occupancy of the property for the past 15 years and refinanced the property in 2005 which returned 120% of the investors original $1,200,000 of equity capital. Cash flows have been 8% each year on the original investment. Denair Senior Apartments in Turlock, California Since 1997, Madison has been general partner, asset manager and property manager for this 70-unit senior apartment property and has been able to maintain a 98% occupancy at the property for the past 14 years. Madison refinanced the property in 2002 and 2008. As a result, the investors received over 150% of their original invested equity through refinancing proceeds and annual cash flows are 9% on the original equity. Arbors Senior Living in San Diego, California This property is a 96-unit senior assisted living and memory care apartment facility and is subject to a 15 year master lease by an affiliate of Madison. Since its acquisition in 2008, the operation has maintained an average occupancy rate of 95% and a 7% cash flow to investors and there is land for a future expansion. | P R O P E R T Y B A N K I N G |
  • 2. You Secure RV & Self Storage in Nashville, Tennessee This facility is a 520-unit self storage and RV storage. We purchased 5.4 acres of land in 1998 and designed and developed the self storage facility on the land. The property was financed with a bank loan of $2,500,000 and capital equity investment capital of $1,200,000. Madison continues to provide management services for the property and the investors are receiving an annual 8% cash return. Park Club Townhomes in Westerville (Columbus), Ohio Since 1989 to the present, Madison has been the manager, general partner, property manager and asset manager for this property, a luxury apartment rental community. A limited partnership built 372 condominiums on the site in 1988. In 1989, Madison purchased the unsold units, and redeveloped the property as a luxury apartment property for lease. Our investor group paid $30,000 per unit (the units were recently appraised for $90,000 per unit). Our partnership paid $12,500,000 for the property with mortgage debt of $9,500,000 and equity capital of $3,000,000. Madison has caused the property to be refinanced with replacement debt twice since 1989. Each time the equity distributed out to the investors has been more than 100% of their original capital. In addition, the investors have received and continue to receive annual 8% cash flow distributions as well as allocations of tax loses to shelter their other investment income. Williamsburg Square in Columbus, Ohio Since 1991 to the present, Madison has been the asset manager and general partner for Williamsburg Square, an apartment rental community of 384 apartments near Columbus, Ohio. Madison assumed the general partner and asset manager role and has refinanced the loan which has returned to the investors, 100% of their original capital and an annual 8% cash flow on their original equity amount. Lakeview Square Townhomes in Dublin, Ohio Since 1989 to the present, Madison has been the manager, general partner, property manager and asset manager for Lakeview Square Townhomes, a luxury apartment rental community located in Dublin Ohio. Investors built 470 townhouse condominiums on the site in 1988. In 1989, Madison purchased the unsold project, and redeveloped the property as a luxury apartment property for lease by the rental tenants. The partnership paid $30,000 per unit (the units were recently appraised for $90,000 per unit with the appraisal based on a rental rather than condominiums). The partnership paid $17,500,000 for the property with mortgage debt of $13,500,000 and equity capital of $4,000,000. Madison caused the property to be refinanced with replacement debt twice since 1989. Each time the equity distributed out to the investors has been more than 100% of their original capital. In addition, the investors have received and continue to receive 7-9% annual cash flow distributions as well as allocations of tax loses to shelter their other investment income. | P R O P E R T Y B A N K I N G |
  • 3. Assisted Living 51 in Phoenix, Arizona In 2008, we took over the management of a 90 bed assisted living seniors property in Phoenix, Arizona. In addition to refurbishing the common areas including the entrance and dining area, we developed a revised operating and market plan. As a result, we doubled the number of memory care beds from 30 to 60 beds. This increased the occupancy and increased rents increasing the monthly income by $180,000 and the value of the property by $2,000,000. Victor Valley Mortgage Investors, in Victorville/Hesperia, California In 1996, we formed a real estate investment company wherein we raised $3,000,000 of equity to purchase a 66 acre land banking property in Victorville/Hesperia, California for $40,000 per acre. Initially, the property was zoned by the city of for development as single family suburban homes. In 1997-99, we designed and obtained approval from the city for a new development plan for the entire site with revised zoning for 23 acres of the tract to multi-family apartments. In 2001, we caused the partnership to sell the re-zoned apartment land to an apartment builder for a price of $2,200,000. This activity generated a gross profit of $1,280,000 to the investors for this parcel alone. In 1999 and 2000, we re-zoned the remaining portion of the Victor Valley site (43 acres) and we obtained a conditional use permit for single family development which increased the density from four lots to the acre to six lots to the acre. We then caused the limited partnership to sell the 43 acres with the conditional use permit to a home builder for $9,000 per lot or $2,300,000, net of costs. The $2,300,000 value was all profit to the investors. Stonebrook Estates in Apple Valley, California In 1998, we purchased a 94 acre parcel of land in Apple Valley, California where we developed a revised development plan and obtained a conditional use permit to create a gated community of luxury single family homes known as Stonebrook Estates. We completed the development entitlements to the land and we formed a joint venture with a local home builder and contributed the 140 home lots to the joint venture. The builder built the homes, sold them and in 2002 the joint venture was liquidated and our investors made a net profit of $2,100,000 more than doubling their investment. | P R O P E R T Y B A N K I N G |
  • 4. Riverside Center Commerce Park II in Hesperia, California In 1997, we formed Riverside Center Commerce Park II, which purchased a 49 acre site of land in Hesperia, California. The purchase price was $3,700,000 or approximately $75,000 per acre. When the partnership purchased the property, it was zoned for commercial/office space. In 1999, we obtained approval and a permit from the city to revise the development plan and we obtained a permit to build a recreational vehicle and self storage facility on 11 of the 49 acres near the back of the site. This facility was built and has 680 self storage units and 104 spaces to store boats, cars and vehicles. The recreational vehicle and self storage facility has operated since 2000 and generated approximately $650,000 of income increasing the value of the property and the site by $3,500,000 and giving annual 10% cash flows to investors. We are presently negotiating with WalMart to purchase the 20 acres to build a new super retail property. The remaining 13 acres will be developed as retail commercial center and will include a senior assisted living apartment. Grissom Road Self Storage in San Antonio, Texas In 2007, we purchased and took over management of Grissom Road Self Storage, an existing self storage facility consisting of 265 self storage units and undeveloped excess adjacent land in San Antonio, Texas. The excess land consisted of approximately 13 acres of land zoned commercial. To take advantage of local market conditions and fill a market shortage, we added 275 parking spaces for boats and vehicles. We also added 40 new storage units. We reduced the property taxes with an appeal and these actions increased the annual net income from $220,000 to $465,000 and increased the value of the property from $2,600,000 to $5,500,000 while cash flows were 20% by the third year. Wolf Creek Development Phase Two, LLC in Raleigh, North Carolina In 2006, we formed Wolf Creek Development Phase Two, LLC which purchased 23 acres of land in Raleigh, North Carolina. The property was zoned for student housing apartments and during 2006 and early 2007, we redesigned the property to provide student apartments for 648 suites. Each of the suites are fully furnished and the facility provided many social and sports amenities for the residents. The construction was completed in late 2008. During 2009 and 2010, our management company pursed a marketing plan and leased the facility. We are now managing the facility for the investors who invested $8,500,000 of equity. While there was no cash flow during construction and lease up, the property now generates an annual 10% cash return to investors. | P R O P E R T Y B A N K I N G |
  • 5. Magnolia Gardens in Riverside, California In 2004, we acquired development land zoned for 48 market rate apartments located in Riverside, California. We redeveloped the parcel of land and obtained a conditional use permit which allowed the partnership to build an 86 unit three story senior housing apartment property called Magnolia Gardens. We funded the construction with a $7,500,000 construction loan and raised $2,100,000 of equity. The property was constructed in 2005 and leased up in 2006. In 2007, at the end of the construction and lease up effort, the partnership sold the property. The sale returned the $2,100,000 of investor equity and gave the investors an additional $3,500,000 of net profit within 36 months. Silo Self Storage in Nashville, Tennessee. In 1999, an entity sponsored and managed by Madison purchased a 7.8 acres of land and built a self storage property in Nashville, Tennessee for $3,600,000. We doubled the size of the property using construction financing to build phase two and three which increased the investor equity from $1,200,000 to $ 2,100,000. We sold the property for a $900,000 profit in 2006. We note that certain properties enjoy a higher increase in value or different rate of growth in net operating profit. It should be noted that each property has its own unique risks and potential. This track record is related only to those properties we have cited above and numbers are approximate and are in U.S. dollars. | P R O P E R T Y B A N K I N G |