Raul Sanchez De Varona is a partner, Managing Director, COO & CFO of Miami based The Solution Group. RJ is a native of Chicago, Illinois, raised in Miami, Florida, a seasoned international transaction business executive with vast experience in senior management and corporate finance and operations particularly within the real estate area.

1. INNOVATIVE THINKING IN REAL ESTATE
The Premier
Wholesaler of
Distressed
Properties
2013

4. 01 TSG Track Record
Raul Sanchez De Varona is a partner, Managing Director, COO & CFO of Miami based The Solution Group. TSG is a vertically integrated company which has identi ed a unique opportunity within the US housing market crisis and has developed a unique program to take advantage of it, particularly in South Florida. Through this Distressed Assets Program, TSG, after diligent inquiry and analysis, acquires "distressed" properties, de ned as residential real estate which either have been acquired by foreclosing mortgage lenders, or are REO's and Short Sales. After acquisition, TSG rehabilitates the properties, rents and stabilizes them and then packages them for sale individually or in groups.
With a multi-disciplinary team with over 50 years of collective experience, TSG identi es sub- markets where to participate, taking into account the median household income, the demand of the market and its potential appreciation. Having identi ed the opportunity, TSG proceeds to the acquisition and stabilization of the property.
TSG's Construction Division administers and supervises the rehabilitation process, pursuant to established standards and upon completion delivers the properties to the Leasing Division which is responsible for renting them.
Once the properties are sold by TSG Realty, the company's Property Management Division provides property administration services to its customers.
Distressed properties acquired by TSG 2,102 by foreclosure programs in Miami-Dade, Broward & Palm Beach counties.
1,190 All remodeled properties by TSG are delivered with the highest standards
for rent.
The average time that TSG properties 36 take before being delivered to the
commercial department
The Premier Wholesaler of Distressed Properties

5. É possível comprar imóvel em Miami por 65 mil dólares
São Paulo – De um lado, o estouro da bolha imobiliária na crise de 2 0 0 8 p r o v o c o u u m a q u e d a vertiginosa no preçodos imóveis emMiami. Deoutro, a valorização do real nos
Piscina em condomínio em Miami: preço das casas parte de 65 mil dólares
A ideia é que o investidor vire proprietário de imóveis já alugados, conseguindo faturar por duas frentes. De imediato, será possível embolsar o valor do aluguel pago pelo inquilino norte-americano, um retorno anual líquido de 7% a 8% sobre o preço do imóvel, superior ao rendimento da poupança no Brasil. No longo prazo, a expectativa é que as casas também se recuperem do desconto sofrido com a crise de 2008, ficando até 45% mais caras.
Presidente do The Solution Group (TSG), incorporadora que atua na compra
e venda de casas subavaliadas, Camilo Lopez afirma que cerca de 50 mil famílias em toda a Flórida passaram de donas a inquilinas desde a quebra do Lehman Brothers. Apertada a torneira do crédito, muita gente optou por entregar o imóvel ao banco, já que os preços derreteram, mas os financiamentos permaneceram caros, com as parcelas acordadas no auge da especulação imobiliária.
As famílias passaram a alugar e as incorporadoras entraram em cena, garimpando achados no mercado e suprindo a nova demanda. Nos últimos 16 meses, a TSG adquiriu 628 propriedades, uma compra estimada em 90.
The Premier Wholesaler of Distressed Properties

6. Historic
Opportunity
The fundamentals of the real estate industr y have never aligned themselves the way they have done so, with properties selling for less than their replacement value; rent values going up, low unemployment indexes and the best forecast for market rebound and prices regaining value again.
The Premier Wholesaler of Distressed Properties

7. As shown in the graph, the real estate market cycle is at the point of greatest certainty and minimum risk, the risk return ratio is at its lowest value.
Phases of Real Estate Market Cycle
MINIMUM
OPPORTUNITY
MINIMUM RISK
2006
Speculation
Sales Increase
Sales Decrease
Optimism
Uncertainty
Optimism
Recession
Sales Increase
2012
Recovery
MAXIMUM
OPPORTUNITY
MINIMUM RISK
Analysts expect a bull market for the next 4 years back in many cases to the maximum marked in 2007.
380
330
Forecast
280
230
180
130
80
2011.1
1979.1
1981.1
1983.1
1985.1
1987.1
1989.1
1991.1
1993.1
1995.1
1997.1
1999.1
2001.1
2003.1
2005.1
2007.1
2009.1
2013.1
2015.1
2017.1
Office
Industrial
Multifamily
Commercial
Real Estate
NCREIF Index Value in 1Q 1978 = 100 Source: CBRE Econometric Advisors / Torto Wheaton Research
The Premier Wholesaler of Distressed Properties

8. JPMorgan entices millionaires to become landlords
by Margaret Collins, John Gittelson and Heather Perlberg February 4, 2013
JPMorgan Chase & Co. (JPM) is giving its wealthiest clients the chance to invest in the single-family rental market after other investments linked to the U.S. housing recovery jumped in value.
The firm's unit that caters to individuals and families with more than $5 million, put client money in a partnership that bought more than 5,000 single family homes to rent in Florida, Arizona, Nevada and California, said David Lyon, a managing director and investment specialist at J.P. Morgan Private Bank. Investors can expect returns of as much as 8 percent annually from rental income as well as part of the profits when the homes are sold, he said.
The bank's wealthy clients are joining a growing number of private-equity firms and individuals buying rental homes in the regions hardest hit by the U.S. housing crash. Blackstone Group LP (BX) has spent $2.7 billion, and said last month it accelerated purchases as home prices rise faster than anticipated. Even after home values in November gained by the most in six years, investors are wagering on rental properties as an alternative to housing-related stocks and mortgage debt that's already soared.
“The traditional places people might look -- homebuilder stocks and appliance makers -- probably aren't the best places for new investments,” said John Buckingham, chief investment officer at Al Frank Asset Management in Aliso Viejo, California, which oversees about $4.5 billion. “They've had fantastic runs.”
Builders Gain
PulteGroup Inc., the largest homebuilder by market value, was the biggest gainer on the Standard & Poor's 500 Index last year, rising 188 percent, helping an index of 11 builders more than double since the end of 2011, and raising concern among analysts including Michael Widner of Stifel Nicolaus & Co. that growth is already priced in.
Whirlpool Corp. (WHR), a home-appliance maker, was the third-best performing stock in the S&P 500 Index last year, rising 114 percent, and subprime-mortgage bonds gained more than 40 percent.
The investments rallied as the housing recovery strengthened through 2012 with the Federal Reserve pushing mortgage rates to record lows, and as institutional investors increased their purchases of foreclosed homes. Home prices in 20 U.S. cities rose 5.5 percent in November from a year earlier, the most in more than six years, an S&P/Case-Shiller index of property values showed last month.
Pooling Investments
New York-based JPMorgan, whose private bank oversees $877 billion, started pooling investments from its clients in mid- 2012 into a partnership to purchase distressed properties, betting that prices will rise over the next several years and provide investors with income from renters along the way, said Lyon. The firm uses a third-party manager to find homes, buy and manage them, he said, declining to name the firm.
The goal is to sell the houses within three to four years in one of three ways: through an initial public offering of a real estate investment trust, a sale to an existing REIT or to an institutional buyer such as a pension fund, Lyon, who's based in San Francisco, said. Clients will receive a share of any price appreciation depending on the size of their investment.
The Premier Wholesaler of Distressed Properties

9. Blackstone Rushes $2.5 Billion Purchase as Homes Rise
By John Gittelsohn and Heather Perlberg
January 09, 2013
Blackstone Group LP (BX), the largest U.S. private real estate owner, accelerated purchases of single- family homes as prices jumped faster than it expected.
Blackstone has spent more than $2.5 billion on 16,000 homes to manage as rentals, deploying capital from the $13.3 billion fund it raised last year, said Jonathan Gray, global head of real estate for the world's largest private equity firm. That's up from $1 billion of homes owned in October, when Blackstone Chairman Stephen Schwarzman said the company was spending $100 million a week on houses.
“The market is moving much faster than anybody thought possible,” Gray said during an interview in Blackstone's New York headquarters. “Housing is much stronger than people anticipated.”
Blackstone is the largest investor in single-family homes to manage as rentals, acquiring properties in nine markets, from Miami to Phoenix, where prices surged 22 percent in the 12 months through October. The firm, along with Thomas Barrack's Colony Capital LLC and Two Harbors Investment Corp. (SBY), is seeking to transform a market dominated by small investors into a new institutional asset class that JPMorgan Chase & Co. (JPM) estimates could be worth as much as $1.5 trillion.
The market, which has been “dominated by 'Mom and Pop' owners” could total 12 million homes and be double the size of the institutional multifamily market, JPMorgan analysts led by Anthony Paolone, wrote in a note yesterday. “A corporate structure with institutional capital around the business makes sense.”
Blackstone, which started buying the properties last year, has been racing against the real-estate recovery as prices across the U.S. rose more than economists forecast, with the areas hardest hit by the crash rebounding the most.
The S&P/Case-Shiller index of property values in 20 cities increased 4.3 percent in the 12 months through October, the biggest 12- month advance since May 2010, the group said last month in Newz York. Prices will gain 3.3 percent in 2013 after an estimated 4.5 percent jump last year, based on the median estimates of 15 economists and housing analysts surveyed by Bloomberg News.
Blackstone is buying in Atlanta, Chicago, Las Vegas, Phoenix, Northern and Southern California; Miami, Orlando and Tampa, Florida - - where prices fell so far that they “overshot,” said David Roth, managing director at Blackstone overseeing single-family home rentals.
Blackstone has been purchasing through foreclosure auctions and short sales, in which banks agree to accept less than is owed on the mortgage, after more than 5 million homeowners lost their homes since the market's peak in 2006.
It's bought so quickly it's “warehousing” more than half of the homes it's acquired as it completes the purchase and hires staff and contractors to renovate and rent the properties, Gray said. It takes about 30 days to fix each home and then as much as 30 days to lease the property, he said.
“Renovating the 16,000 homes is an enormous job,” Gray said.
By comparison, D.R. Horton Inc. (DHI), the largest U.S. homebuilder by volume, sold 18,890 homes and generated $5.35 billion in revenue in fiscal 2012.
The Premier Wholesaler of Distressed Properties

10. Money
Economists: Housing recovery finally here
By Chris Isidore
October 2, 2012
It's been a long time coming, but economists surveyed by CNNMoney believe the nation's housing market has finally turned the corner.
Of the 14 economists who answered questions about home prices in the survey, nine believe that prices have already turned higher or will make that turn later this year. Only three months ago, half of the economists surveyed by CNNMoney believed a turnaround in prices would not take place until 2013 or later.
Economists have been encouraged by a variety of readings, including three straight months of increases in the S&P/Case-Shiller home price index, a pick-up in sales of existing homes and home construction and a big jump in the price of new home sales.
Economists have been encouraged by a variety of readings, including three straight months of increases in the S&P/Case-Shiller home price index, a pick-up in sales of existing homes and home construction and a big jump in the price of new home sales.
"We're seeing the signs of a pulse in a sector that has been flat-lined for a number of years," said Sean Snaith, economics professor at the University of Central Florida.
Determining when the housing market has turned the corner is important for more than home builders and real estate agents. Even before soaring foreclosures sparked a meltdown in financial markets in 2008, the housing market had become a significant drag on the economy. Housing continued to subtract from the nation's gross domestic product right up through early 2011.
But starting in the fourth quarter of last year, housing has been adding to growth. Lynn Reaser, chief economist for Point Loma Nazarene University, said housing is now bucking the trend in what is otherwise a sluggish U.S. economy.
Still, economists don't believe housing is ready to be a major driver of economic growth, as it was during the housing boom and some earlier economic recoveries. But housing could keep the economy moving in the right direction.
Some of the economists surveyed said they believe there's been some fundamental change of thinking in the market place. Buyers who had postponed housing purchases while prices slid are finally more comfortable making the plunge.
"You had a lot of people with what they needed to buy homes -- jobs, decent credit scores -- who were on the sidelines. All they needed to do is wait for their confidence to rebuild," said David Crowe, chief economist for the National Association of Home Builders.
Reaser said that that change in attitude is a key to the market turnaround.
"The firming in home prices might be feeding on itself," she said. "You've got buyers not wanting to miss the bottom of home prices and mortgage rates."
The Premier Wholesaler of Distressed Properties

11. 04 Business Process
The Premier Wholesaler of Distressed Properties

12. 05 Properties

13. TYPE: Townhome Cambridge Park
3 Bed / 2 Bath
3011 NW 30th Ave. #3011 Oakland Park, FL 33311
Sq. Ft. 1,382
Sales Price
$ 176,500
$500,000
$400,000
$300,000
$200,000
$100,000
$0
Estimated Monthly Rent:
$
1,399
Estimated R/P Taxes / Mth:
$
240
HOAs:
$
88
Prop. Man:
$
80
NOI: $ 991
CAP: 6.74%
Historic
Replacement
Fair Market
TSG Sales
High
Value
Value
Price
TSG REF: GPB 1
Equal Housing Opportunity. Oral representations cannot be relied upon as correctly stating representations of the developer. For correct representations, reference should be made to the documents required by section 718.503, Florida Statutes, to be furnished by the developer to a buyer or leasee. Not an offer where prohibited by state statutes.
The Premier Wholesaler of Distressed Properties

14. TYPE: Townhome Silver Palms East
4 Bed / 3 Bath
11483 SW 238 St. Homestead, FL 33032
Sq. Ft. 1,996
Sales Price
$ 175,000
$500,000
$400,000
$300,000
$200,000
$100,000
$0
Estimated Monthly Rent:
$
1,400
Estimated R/P Taxes / Mth:
$
284
HOAs:
$
46
Prop. Man:
$
80
NOI: $ 990
CAP: 6.79%
Historic
Replacement
Fair Market
TSG Sales
High
Value
Value
Price
TSG REF:HCD 19
Equal Housing Opportunity. Oral representations cannot be relied upon as correctly stating representations of the developer. For correct representations, reference should be made to the documents required by section 718.503, Florida Statutes, to be furnished by the developer to a buyer or leasee. Not an offer where prohibited by state statutes.
The Premier Wholesaler of Distressed Properties

15. TYPE: Townhome Sonoma Bay
3 Bed / 2 Bath
3550 Oleander Ter. Riviera Beach, FL 33404
Sq. Ft. 1,318
Sales Price
$ 120,600
$300,000
$250,000
$200,000
$150,000
$100,000
$0
Estimated Monthly Rent:
$
1,049
Estimated R/P Taxes / Mth:
$
135
HOAs:
$
190
Prop. Man:
$
80
NOI: $ 644
CAP: 6.41%
Historic
Replacement
Fair Market
TSG Sales
High
Value
Value
Price
TSG REF: S4P 6
Equal Housing Opportunity. Oral representations cannot be relied upon as correctly stating representations of the developer. For correct representations, reference should be made to the documents required by section 718.503, Florida Statutes, to be furnished by the developer to a buyer or leasee. Not an offer where prohibited by state statutes.
The Premier Wholesaler of Distressed Properties

16. Location
Location
Location...
The Premier Wholesaler of Distressed Properties

17. 07 Analysis sample package
Total
Per Unit
Number of Units
7
Area (Sq. Ft.)
10,504
1,501
Historic High
$
2,112,995
$
301,856
Sq. Ft. Value
201.16
Fair Market Value
$
1,078,190
$
154,027
Sq. Ft. Value
$
102.65
TSG Distressed Price
$
1,008,400
$
144,057
Sq. Ft. Value
$
96.00
Discount Over Fair Market Value
$
1,104,595
$
157,799
Sq. Ft. Value
$
105.16
Percentage
52.28%
Discount over Fair Market Value
$
69,790
$
9,970
Sq. Ft. Value
$
6.64
Percentage
6.47%
Annual Rental Income
Total
Per Unit
Estimated Rental Income
$
104,352
$
14,907
Estimated Taxes
$
(13,944)
$
(1,992)
Estimated HOAs
$
(12,900)
$
(1,843)
Estimated Property Management
$
(6,720)
$
(960)
Total
$
70,788
$
10,113
CAP / (Ratio)
7.02%
The Premier Wholesaler of Distressed Properties

18. Two NE 40th Street, Suite 204 Miami, FL 33137 305.438.1259
EN
www.thesolutiongroup.net