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Pintar Investment Company
PICR Fund III
| Investing in Single Family Homes while Compounding Wealth |
Company Overview
2
History • Founded in 2008
• Invested Over $1B in 5,000 homes on behalf
of institutional and private investors
Why Us? • We’ve consistently outperformed major
market indices over the past six years
• Averaged 11% annual Cash on Cash returns
since inception
• Averaged over 20% annual all in returns
since inception
• Scale delivers operational efficiencies
• Alignment of interest – All partners have
skin in the game
Partnerships • Institutional investors we have provided our
vertically integrated services to include:
• Colony American Homes
• Progress Residential
• KKR / Beazer Pre-Owned Homes
• Numerous family offices
La Mesa
Flip Profit: $50,345
San Diego
Flip Profit: $50,548
Pintar Investment Co./Vertical RE Platform
Delivering consistent service across multiple markets through a vertically integrated services
platform.
3
1
2
3
45
6
7
Strategic real estate investment
advisory services
Property
Management/LeasingMortgage Lending Services
Analytical & Valuation
Services
Escrow/Title Services Construction Management &
Maintenance
Brokerage operations
The Search for Yield
4
“Those days” of believing 8% could be earned annually “aren’t here anymore,” said New
York state Comptroller Thomas P. DiNapoli
Single Family Residential Market Drivers
• Employment increased on average by 241K per month which is 47K more per month
than last year
• Population and household growth outpacing housing supply – No New Homes being
built
• The Unemployment rate moved from where it was at the beginning of the year at 6.6%
to 5.8%
• US GDP on track for 2 to 3% Growth
• Equity markets saw true earnings increase, not just multiple expansion
• Demand for housing continues to increase – record number of new households being
formed; population growth at record highs and millennial’ s are just beginning to come
into maturity
5Source: J.P. Morgan – 2015 Economic & Market Outlook; Jan 2015
The housing market has rebounded from the depths. Consumer sentiment and deleveraging
has picked up the pace.
Real Estate Investments
Driven by Fundamentals Not by Speculation
U.S Population
Growth
3 million per
year
Single Family
Homes Built
500k
Per year
Home Prices
UP
U.S Economy and
Home Buying
Improving
More people can
afford to buy, but
they choose to
Rent
Rent Rates
UP
Rental rates historically
rise
+/-5%
Per year
Vacancy rate for
rental homes
Below 5%
Nationally
Low
Supply of
Homes
Lack of
Quality
Homes
Available
High
Demand
for Rent
Low Supply
of Rental
Homes
Higher
Rent Rates
The Opportunities in Investing in SFHs
7
Increasing Home Prices Rising Rent Rates
PICR Fund III
PICR Fund III provides investors an opportunity to own a portfolio of consistent, predictable cash flowing and
appreciating residential properties while maintaining the flexibility to redeem their capital, not otherwise available in
real estate assets
More LiquidityCompounding
Wealth
Increasing Home Demand High Rental Demand
Consistent Cash
Stream
More Cash Flow
5% +
Allocate
How You Make Money by Investing in Single
Family Homes
8
Investors
Invest
PICR
Invest
PICR Fund III
Residential Rental
PICR collects rents from tenants and distributes
quarterly dividends to investors
PICR purchases, rehabs, and resells homes
generating short-term cash return to investors
House Flipping
Dividend
Investors
receive
+/- 11% Annual
Cash on Cash
Distribution
*Based on historical past performance
*
Time to Load Up Single Family Homes
Plenty of opportunities to buy Dollars for Seventy Cents.
9
“Single Family Homes – I would
load up on them…it is a very
attractive asset class now.”
- Warren Buffet
HOME PRICE APPRECIATION
Appreciation has been strong, yet prices
are still less than 75% of peak and
replacement cost.
HISTORICAL AFFORDABILITY
Many tenants can afford to buy the home
they rent, but can’t get credit or choose to
rent and save their hard earned money.
HIGH BARRIER TO
ENTRY
Very difficult to execute
investment strategy
without operational
infrastructure and local
market knowledge
PRICE < REPLACEMENT COST
Current market prices remains below
replacement costs
LACK OF NEW SUPPLY
Despite significant household
formation and population growth,
new home build has been lagging
historic averages by 1mm homes/
year for the past 5 years
Widening Gap: Population Growth V.S. Housing
Starts
On average, population growth has been 4.7x new single home construction over the past 6
years from 2008 – 2014.
10
Source: Economic Data by The Federal Reserve Bank of Saint Louis
0
500
1000
1500
2000
2500
0
50
100
150
200
250
300
350
HousingStarts(ThousandUnits)
TotalU.S.Population(Million)
U.S. Population Grows Faster than Housing Starts
Population Housing Starts - Single Family
Housing Starts - Multi-Family Total Housing Starts
New SFH Construction Population Growth Population Growth over
(units) (person) New SFH Construction
2008 622 thousand 2.8 million 4.5x
2009 445 thousand 2.7 million 6.0x
2010 471 thousand 2.4 million 5.0x
2011 431 thousand 2.2 million 5.1x
2012 535 thousand 2.2 million 4.1x
2013 618 thousand 2.2 million 3.6x
2014 677 thousand 3.1 million 4.6x
Total 3.799 Million 17.6 Million 4.6x
Year
Housing Shortage Supports HPA
Median Home Price Appreciation
(% change from one year ago)
11Source: Residential Economic Trends 2015 – National Association of Realtors
We predict home prices will continue to rise 3% - 7% per annum throughout the next
decade.
SFR Rentals are 11.2% of the U.S Housing Stock
Since 2007, U.S. homeownership has been steadily declining. Each % point decline
represents a change in the living situation of ~1.1 million people.
12
Single-
Family 14.9
Million
35%
2 to 9 Units 7.7 Million
30%
5 or More
Units 17.9
Million
30%
Mobile
Homes 1.9
Million
5%
What Type of Structure Do Renter
Households Live in?
Source: JBREC (U.S. Housing Analysis & Forecast Report), Q3 2014.
Vacant:
13.9 Million
10%
Renter
Occupied
42.5 Million
32%
Owner
Occupied
76.9 Million
58%
U.S. Housing Stock Totals:
~133M Units or $27.5 Trillion Market
Vacant Renter-Occupied Owner-Occupied
Not Enough Rental Homes to Keep Up with Growing Demand
Housing shortage is expected to continue due to lack of new home construction.
13
 Up to 5 million homeowners lost their homes to foreclosure since the real estate
crash are now renters.
 Landlords also are getting a boost from some of the 85 million millennials – 18 to
34 year-olds – who are starting out as renters rather than buyers.
 Rents on all single-family homes and multifamily units are expected to climb 5%
percent in 2015.
 The U.S. rental-vacancy rate fell to 7.4% in Q3 2014, below 8%. The vacancy rate is
below 5% in California, Nevada, and Arizona.
 More and more people prefer the flexibility of renting and saving their hard earned
dollars instead of creating liability of mortgage.
Source: Washington Post – December 19, 2014
Increasing demand in a supply constrained market provides
excellent opportunity for outsized returns!
Surge in Renter Household Growth
Renter household growth has averaged 770k annually since 2004. This makes 2004-2015 the
best 10 year period for renter growth since the late 1980s.
14
“Rental Markets across the
country are tightening,
pushing up rents at the
national level and across a
majority of markets.”**
Source: JCHS tabulations of US Census Bureau, Decennial Censuses and Housing Vacancy Surveys
** Quotes sourced from The State of the Nation’s Housing, Joint Center for Housing Studies, Havard University, June 26 2013
The Western Region has the largest Renter Base in
U.S. and also the highest average HH Income
15
2000 2014
Existing Home Sales 5.2M 5.1M
New Home Sales 880k 445k
Mortgage Rates 8.00% 3.85%
Avg. Mortgage Payment* $1,187/mo $1,217/mo
Sales Price $142k $207k
Population 282M 319M
* Based on 360 months loan term with 12% downpayment
1.2% property taxes, $800 home insurance
Source: Current Population Survey/Housing Vacancy Survey, Series H-111, US. Census Bureau, Washington, DC
California Has a Higher Percentage of Renters
16
17%
21% 22% 22% 22%
24%
26% 27% 27%
29% 29% 29% 29% 30% 30% 30%
32%
34%
38%
42%
29%
MN WI NY IL NJ IN MI PA MO OH TX MD TN GA NC VA WA FL AZ CA US
Single-Family Rental Rate 30-39 Age Cohort in Largest States
Source: US Census Bureau, Zelman & Associated Analysis
Western US is more stable and has a higher
likelihood for rental growth
Renters of Single Family Homes in PIC’s portfolio spend just 22.6% of income on housing
costs vs a national average of 34%. The average HH income is $73,000 with an average rent
of $1375/month.
17
Rental
Expenditure
23%
Income Net
Rent
77%
PICR's Tenants Contribution of Households
Income to Renting
Rental
Expenditure
34%
Income Net
Rent
66%
National Average Contribution of
Households Income to Renting
Declining Homeownership Rate
Implies Rental Stability
In Q3 2014, renter household growth = 1,239,314 vs. Owner Household Growth = -683,239.
18
Source: JLL Research, U.S. Census Bureau
Zillow Analysis of U.S. Census, Bureau CPS Survey Data 1995-2014
Median Age of Homeowners Has Increased to 44
Aside from the increase in the median age of homeowners, the average gross household
income of homeowners has increased to $85,500. This is above the income of most new
graduates - average income is $45,473.
19
2010 Profile 2011 Profile 2012 Profile 2013 Profile 2014 Profile
Median Age 39 45 42 42 44
Gross HH
Income
$72,200 $80,900 $78,600 $83,300 $84,500
Household
Composition
58% married
couples,
20% single
females, 12%
single males,
8% unmarried
couples
64% married
couples,
18% single
females,
10% single
males,
7% unmarried
couples
65% married
couples,
16% single
females,
9% single
males,
8% unmarried
couples
66% married
couples,
16% single
females,
9% single
males,
7% unmarried
couples
65% married
couples, 16%
single females,
9% single
males, 8%
unmarried
couples
Children in
Home
35% 36% 41% 40% 35%
Own a 2nd
Home
14% 19% 19% 19% 21%
Source: 2014 Profile of Home Buyers and Sellers, National Association of Realtors
April 2014 Salary Survey, National Association of Colleges and Employers
Despite Low Rates, It’s Difficult to Obtain a
Mortgage
As the mortgage credit availability shrank after the housing crisis, loan originations dropped
almost 50% as compared to 2004, yet still exceeding $1.1 trillion in 2014!
20
-
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
0
200
400
600
800
1000
1200
1400
2000-Q1
2000-Q3
2001-Q1
2001-Q3
2002-Q1
2002-Q3
2003-Q1
2003-Q3
2004-Q1
2004-Q3
2005-Q1
2005-Q3
2006-Q1
2006-Q3
2007-Q1
2007-Q3
2008-Q1
2008-Q3
2009-Q1
2009-Q3
2010-Q1
2010-Q3
2011-Q1
2011-Q3
2012-Q1
2012-Q3
2013-Q1
2013-Q3
2014-Q1
2014-Q3
LoanOriginationsfromPurchaseas%ofTotal
MortgageOriginations($Billion)
Loan Origination
(2000 - 2014)
Mortgage Originations - Purchase Mortgage Originations - Refinance
Loan Origination from Purchase as % of Total
Source: Mortgage Bankers Association; Powered by AllRegs Market Clarity
Economic Data by The Federal Reserve Bank of St. Louis
Down Payment: The Biggest Obstacle for Young Renters
63% of Millennials lack the required 20% down payment to qualify for a traditional
mortgage.
21
Estimated Upfront Cash
Needed to Purchase a Home
2014 Starter Home Price:
$292,700**
3.50% 5% 10% 20%
Down Payment 10,245$ 14,635$ 29,270$ 58,540$
Closing Costs**
Cash Reserve (0-6 months)
Estimated Minimum Total
Upfront Cash
12,647$ 17,037$ 31,672$ 60,942$
**Source: National Association of Realtors
$2,402
$0-$4,458
Down Payment (% of Home Price)
“It takes an average of 12.5 years to save up a 20% down payment – the usual requirement by
banks – with the current personal savings rate of 5.6%”, according to a new research by real-
estate firm RealtyTrac.
Source: National Housing Survey, Fannie Mae
Own a Piece of a Multi Million Dollar Portfolio
Investors share ownership in all of PIC’s single family homes across multiple geographic
regions.
22
Stratified by PSF of Properties
Purple: <$50
Blue: $50 - $105
Light Blue: $105 - $150
Green: $150 - $200
Yellow: $200 - $250
Orange: $250 - $300
Red: $300 - $750
Southern California Homes
Las Vegas Homes
Diversify Your Real Estate Investment Portfolio
23
Buying a single house Joining a pool to invest in a bulk
of houses
VS
All your
money is
locked in one
property
Your risk is
concentrated
all in one
basket
You have ownership in
one single house
All the troubles
related to the
house is on your
shoulders
You have ownership in
ALL of PIC’s properties
You have ownership in all of PIC’s properties in Southern California, Nevada, Georgia
Plus: 11% Cash on Cash
distribution AND your
Return on Equity increases
as value of homes
appreciate
Plus: Your risk is diversified
throughout a portfolio of
homes – not concentrated
in one home
Plus: All the expenses and
harassments dealing with
home repairs is on PIC – not
your shoulders
Adding Value through Professional Renovation
24
Front House Living Room
Kitchen Backyard
Newport Beach, California Flip
Before Photos
Front and Back of the House Inside House
Kitchen and Bathrooms
Front House Backyard
Kitchen Master Bathroom
Bathroom 1 Bathroom 2
Living Room Stairs
Dining Room Family Room
Master Bedroom Bed Room 2
Newport Beach, California Flip
During Construction
Front and Back of the House Inside House
Patio from Outside Patio from Inside
Sideway 1 Sideway 2
Backyard Phase 1 Kitchen
Family Room
Living Room 1
Stairs and Family Room
Living Room 2
Backyard Phase 2
Dining Room
Newport Beach, California Flip
After – Finished Product
Front and Back of the House
Inside HouseKitchen and Bathrooms
Front House Backyard
Kitchen Master Bathroom
Bathroom 1 Bathroom 2
Living Room Stairs
Dining RoomMaster Bedroom
Garage and Sideway
Platio Sideway
Overview of Key Offering Terms of Fund
28
Fund Name: PICR Residential Fund III, LP
Manager: PIC Renegade Properties, LLC
Preferred Return: Investors earn an 6% preferred return on their invested balance. If
our quarterly cash distribution is less than 6%, the balance will
accrue to their capital balance and will be paid before any profit split
Minimum Investment: $500,000 or other amount at the discretion of the Manager
Redemption Rights: Annual Redemption Rights
Asset Management Fee: 0.5% per annum
Profit Splits: 70% to Investors and 30% to Manager after the 6% preferred return
Distributions: Quarterly
Target Leverage: Not to exceed 65% of value
Return of Equity: Debt Proceeds on stabilized assets will return equity increasing
investors ROE
Pintar Fund Structure
29
Management Team
30
Jeff Pintar – CEO and Founder at Pintar Investment Company
Prior to founding PIC, Jeff was the National Retail Partner and member of the Investment Committee at Panattoni
Development Company Inc. (PDC). During Jeff's tenure at PDC, the company developed and delivered over 40M
square feet of new commercial projects valued in excess of $5B.
Jeff began his real estate career with CB Richard Ellis and became one of the nation's leading revenue producers for
the firm receiving Circle of Excellence awards in 1996 - 2003. In 1999 Jeff moved to Australia where he sat on the
Asia Pacific Senior Leadership Board which oversaw the regions 20 offices and Retail Business Line.
Jeff is active in YPO and serves as an Executive Member on the National Real Estate Network, ICSC and several
charitable groups.
John Kralik – Partner and Co-founder at Pintar Investment Company
As founding partner, John is responsible for all operational aspects of the organization, acquisitions, disposition,
and management of funds. John is an experienced leader in the real estate industry bringing with him over 10
years of real estate experience.
Before joining Pintar Investment Company in 2009, John was president and owner of JT Investment Properties in
Los Angeles, specializing in the acquisition and disposition of trustee sale single family residences through
Southern California.
Prior to joining JT Investment Properties, John was a Vice President at DC Commercial in Century city for five
years, specializing in the acquisition and sale of retail and office properties in Los Angeles County. John earned a
Bachelor of Administration from Loyola Marymount University in Los Angeles.
Investing in Our Funds Has Risks –
Please Review
31
Your potential interest in this investment opportunity (your “Interest”)
is speculative and involves risk.
You should carefully read this memorandum and, if one has been provided, review the Proforma for the Interest
(“Proforma”), including the assumptions thereto, before purchasing the Interest. The Proforma consists of
“forward–looking” statements that are based on various assumptions regarding future operation and
management of the Subject Project, such as renovations, marketing and certain budgeted expenditures. These
forward-looking statements may not accurately predict future events or the actual performance of the Subject
Project. It is possible that you could incur a complete loss of your investment and you should be able to
financially bear such a loss. In addition, any projections and representations written or oral, which do not
conform to those contained in the investment proposal must be disregarded.
You should consider carefully, among other risks, the following risks, and should consult with your own legal, tax,
accounting and financial advisors before investing in the Interest. These risk factors, or other events, could cause
actual results to differ materially from those discussed in this memorandum.
You should consult with an attorney and a tax advisor prior to purchasing the Interest in order to examine the full
extent of any potential tax and legal consequences relating thereto. This memorandum is not intended to provide
you with any individual legal or tax advice, nor is it intended to provide an all-inclusive discussion of the possible
risks relative to your individual circumstances.
Risks of Investing in Real Estate
32
General Risks of Investment in the Subject Project
Cash flow will be derived from the resale of properties and/or rental payments. Payments to you will be
contingent on the Subject Project’s successful operation; therefore, the economic success of an investment in the
Interest will depend directly upon the resale market and/or lease or leases.
A failure to sell a property and/or a vacancy by a tenant that is not replaced or is replaced at less attractive terms
can adversely affect operating results or render the sale or refinancing of the Subject Project difficult or
unattractive.
No assurance can be given as to the accuracy of certain assumptions related to the future sale and/or occupancy
of the Subject Project by tenants or the ability of such tenants’ to pay rents or costs for the Subject Project, as
these matters will depend on events and factors possibly beyond the control of the limited liability company
members.
Such factors include continued validity and enforceability of the lease in the event a tenant defaults thereunder,
the financial resources of the tenant, adverse change in local population trends, market conditions,
neighborhood property values, local economic and social conditions, supply and demand for property similar to
the Subject Project, competition from similar properties, environmental hazards and liabilities caused by third
parties, interest rates and real estate tax rates and assessments, governmental rules, regulations and fiscal
policies, zoning restrictions, the enactment of unfavorable environmental or hazardous material laws, labor and
material costs, uninsured losses, effects or inflation and other risks.
Risks of Investing in a Private Offering
33
Sale of Interests
You will be required to represent that you are acquiring the Interest for investment purposes and not with a
view to distribution or resale (of your Interest), and that you can bear the economic risk of investment in the
Subject Project for an indefinite period of time. This representation is required because the Interest has not
been registered under any state “Blue Sky” or securities laws, and cannot be sold unless they are subsequently
registered or an exemption from such registration is available. In addition, there is no guarantee that a market
will exist for the Interest, and you cannot expect to be able to liquidate your investment in case of an
emergency. Further, the sale of the Interest may have adverse federal income tax consequences to you.
Offering Not Registered With Securities and Exchange Commissioner or State Securities
Commissions
The Interest will not be registered with the SEC or any state securities commission. The Interest is being offered
in reliance upon an exemption from the registration provisions of the Act and state securities laws applicable
only to offers and sales to prospective members meeting the suitability requirements set forth herein. Since
this is a nonpublic offering and, as such, is not registered under federal or state securities laws, prospective
members will not have the benefit of review or comment by the SEC or any state securities commission.
Private Offering Exemption – Compliance with Requirements
The Interest is being offered and will be sold to you in reliance upon a private offering exemption from
registration provided in the Act and state securities laws. If PIC should fail to comply with the requirements of
such exemption, you will have the right, if you so desire, to rescind your purchase of the Interest. It is possible
that if your rescission succeeds, PIC may not have sufficient funds to pay for such rescission. Your right to
rescission might also fall under applicable state securities or “Blue Sky” laws and regulations in states where the
Interest will be offered without registration or qualifications pursuant to a private offering or other exemption.
Appendix
Pintar Investment Company
Local Stats Update
| Orange County, Los Angeles County, Riverside County, San Bernardino County, San Diego County, and Clark
(Las Vegas) County|
Housing Shortage - Clark County, NV
36
2014 2000
New & Existing Home Sales (SFH & Condos) 51,789 67,400
Mortgage Rates 3.85% 8%
Avg. Mortgage Payment* 1,221$ 1,171$
Sales Price 196,816$ 140,000$
Population 2,056,000 1,393,000
*Based on 360 months loan term with 12% down payment 1.2% property
taxes, and $800 home insurance
Source: U.S Census Bureau, Population & Building Permits by County
U.S Department of Housing and Urban Development – Office of Policy Development and Research, Las Vegas, NV
Year
New SFH Construction
(units)
Population Growth
(person)
Population
Growth/New SFH
Construction
2008 5,840 40,000 6.8x
2009 3,777 24,000 6.4x
2010 4,623 50,000 10.8x
2011 3,817 14,000 3.7x
2012 6,108 31,000 5.1x
2013 7,067 30,000 4.2x
2014 6,623 28,000 4.2x
Total 37,855 217,000 5.7x
Unemployment Rate – Clark County
37
Jul 2010
14.5%
Dec 2014
6.9%
Dec 2014
5.4%
Jul 2010
10.6%
Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
SFH Sales and Permits in Clark County, NV
38
SFH Permitting Is Well Below Historical LevelMLS Home Sales
(in thousands per quarter)
Source: Greater Las Vegas Association of Realtors, Southern Nevada Real Estate Report, Q2 2014
HUD PD&R, Housing Market Profiles, February 2014
Homeownership Rate – Clark County, NV
39
Own
59.10%
Rent
40.90%
2000
Own
51.91%
Rent
48.09%
2013
Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000
Pedia City, Homeownership Rate for Clark County, NV 2013
Housing Shortage - Orange County
40
Source: U.S Census Bureau
National Association of Realtor – Profile of Orange County
Southern California Association of Government – Orange County Profile
2014 2000
New & Existing Home Sales (SFH & Condos) 33,844 24,500
Mortgage Rates 3.85% 8%
Avg. Mortgage Payment* 3,290$ 2,576$
Sales Price 580,000$ 318,000$
Population 3,010,232 2,846,289
*Based on 360 months loan term with 12% down payment 1.2% property
taxes, and $800 home insurance
Year
New SFH Construction
(units)
Population Growth
(person)
Population
Growth/New SFH
Construction
2008 1,298 16,321 12.6x
2009 1,339 16,484 12.3x
2010 1,553 19,427 12.5x
2011 1,898 18,614 9.8x
2012 3,910 26,946 6.9x
2013 3,641 29,708 8.2x
2014 3,660 33,940 9.3x
Total 17,299 161,440 9.3x
Unemployment Rate – Orange County
41
Jul 2010
9.9%
Dec 2014
4.5%
Dec 2014
5.4%
Jul 2010
10.6%
Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
Household Relocation - Orange County – Flight to
Suburbs
42
Source: National Association of Realtors, Internal Revenue Service 2013
Homeownership – Orange County
43
Own
61.40%
Rent
38.60%
2000
Own
58.60%
Rent
41.40%
2014
Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000
First Tuesday Journal; Orange County Housing Indicators, February 2014
Housing Shortage - Los Angeles
44
Source: U.S Census Bureau
National Association of Realtor – Profile of Los Angeles
Southern California Association of Government – Los Angeles County Profile
2014 2000
New & Existing Home Sales (SFH & Condos) 76,065 52,000
Mortgage Rates 3.85% 8%
Avg. Mortgage Payment* 2,901$ 1,770$
Sales Price 510,000$ 215,900$
Population 10,117,239 9,543,000
*Based on 360 months loan term with 12% down payment 1.2% property
taxes, and $800 home insurance
Year
New SFH Construction
(units)
Population Growth
(person)
Population
Growth/New SFH
Construction
2008 3,527 44,000 12.5x
2009 2,099 69,000 32.9x
2010 2,439 (22,000) NA
2011 2,370 59,000 24.9x
2012 4,370 67,000 15.3x
2013 3,839 65,068 16.9x
2014 4,460 100,171 22.5x
Total: 23,104 382,239 16.5x
Unemployment Rate – Los Angeles
45
Jul 2010
13.3%
Dec 2014
7.5%
Dec 2014
5.4%
Jul 2010
10.6%
Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
Household Relocation – Los Angeles – Flight to
Suburbs
46
Source: National Association of Realtors, Internal Revenue Service 2013
Homeownership – Los Angeles
47
Own
47.90%Rent
52.10%
2000
Own
49.10%
Rent
50.9%
2014
Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000
First Tuesday Journal, Los Angeles Housing Indicators, February 2015
Housing Shortage - Riverside
48
Source: U.S Census Bureau
National Association of Realtor – Profile of Riverside County
Southern California Association of Government – Riverside County Profile
2014 2000
New & Existing Home Sales (SFH & Condos) 36,627 17,500
Mortgage Rates 3.85% 8%
Avg. Mortgage Payment* 1,857$ 1,160$
Sales Price 322,020$ 138,560$
Population 2,189,000 1,545,387
*Based on 360 months loan term with 12% down payment 1.2% property
taxes, and $800 home insurance
Year
New SHF Construction
(units)
Population Growth
(person)
Population
Growth/New SHF
Construction
2008 3,817 32,000 8.4x
2009 3,386 37,000 10.9x
2010 4,031 34,641 16.0x
2011 2,690 46,359 17.2x
2012 3,107 29,000 9.3x
2013 4,432 28,000 6.3x
2014 5,000 31,000 6.2x
Total 26,463 238,000 9.0x
Year
New SFH Construction
(units)
Population Growth
(person)
Population
Growth/New SFH
Construction
2008 3,817 32,000 8.4x
2009 3,386 37,000 10.9x
2010 4,031 34,641 16.0x
2011 2,690 46,359 17.2x
2012 3,107 29,000 9.3x
2013 4,432 28,000 6.3x
2014 5,000 31,000 6.2x
Total 26,463 238,000 9.0x
Unemployment Rate – Riverside
49
Jul 2010
15.2%
Dec 2014
7.2%
Dec 2014
5.4%
Jul 2010
10.6%
Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
Household Relocation – Riverside – Growing Again
50
Source: National Association of Realtors, Internal Revenue Service 2013
Homeownership – Riverside – Large renter
population
51
Own
68.90%
Rent
31.10%
2000
Own
59.00%
Rent
41.00%
2014
Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000
First Tuesday Journal; Riverside Housing Indicators, February 2014
Housing Shortage - San Bernardino
52
Source: U.S Census Bureau
National Association of Realtor – Profile of San Bernardino County
Southern California Association of Government – San Bernardino County Profile
Year
New SFH Construction
(units)
Population Growth
(person)
Population
Growth/New SFH
Construction
2008 2,056 18,163 8.8x
2009 1,430 13,597 9.5x
2010 1,198 13,688 11.4x
2011 1,066 15,526 14.6x
2012 1,990 20,694 10.4x
2013 2,040 28,663 14.1x
2014 2,180 36,079 16.6x
Total 11,960 146,410 12.2x
2014 2000
New & Existing Home Sales (SFH & Condos) 25,900 16,500
Mortgage Rates 3.85% 8%
Avg. Mortgage Payment* 1,267$ 1,160$
Sales Price 216,020$ 138,560$
Population 2,088,371 1,709,434
*Based on 360 months loan term with 12% down payment 1.2% property
taxes, and $800 home insurance
Unemployment Rate – San Bernardino
53
Jul 2010
14.8%
Dec 2014
7%
Dec 2014
5.4%
Jul 2010
10.6%
Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
Household Relocation – San Bernardino
54
Source: National Association of Realtors, Internal Revenue Service 2013
Homeownership – San Bernardino
55
Own
64.50%
Rent
35.50%
2000
Own
58.20%
Rent
41.00%
2014
Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000
The Community Foundation, San Bernardino County, Community Indicators Report 2014
Housing Shortage - San Diego
56
Source: U.S Census Bureau
National Association of Realtor – Profile of San Diego
Southern California Association of Government – San Diego County Profile
Year
New SFH Construction
(units)
Population Growth
(person)
Population
Growth/New SFH
Construction
2008 2,361 43,000 18.2x
2009 1,778 35,000 19.7x
2010 2,270 50,000 22.0x
2011 2,245 35,000 15.6x
2012 2,197 37,000 16.8x
2013 2,570 35,000 13.6x
2014 2,480 38,532 15.5x
Total 15,901 273,532 17.2x
2014 2000
New & Existing Home Sales (SFH & Condos) 38,350 20,000
Mortgage Rates 3.85% 8%
Avg. Mortgage Payment* 2,568$ 2,192$
Sales Price 450,000$ 269,410$
Population 3,150,178 2,825,000
*Based on 360 months loan term with 12% down payment 1.2% property
taxes, and $800 home insurance
Unemployment Rate – San Diego
57
Jul 2010
10.9%
Dec 2014
5.2%
Dec 2014
5.4%
Jul 2010
10.6%
Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
Household Relocation – San Diego
58
Source: National Association of Realtors, Internal Revenue Service 2013
Homeownership – San Diego
59
Own
55.40%
Rent
44.60%
2000
Own
53.90%
Rent
46.10%
2014
Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000
First Tuesday Journal; San Diego County Housing Indicators, February 2014
Pintar Investment Company
Investor Relations
www.pintarinvestmentcompany.com
Kevin Sharp
Investor Relations
27372 Calle Arroyo
San Juan Capistrano, CA 92675
Direct/Fax 949.284.0838 | Mobile 949.877.4112
ksharp@pintarinvestco.com
Jeff Pintar
CEO
27372 Calle Arroyo
San Juan Capistrano, CA 92675
Office 949.276.4166 | Direct 949.284.0284
jpintar@pintarinvestco.com

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Institutional Pitchbook

  • 1. Pintar Investment Company PICR Fund III | Investing in Single Family Homes while Compounding Wealth |
  • 2. Company Overview 2 History • Founded in 2008 • Invested Over $1B in 5,000 homes on behalf of institutional and private investors Why Us? • We’ve consistently outperformed major market indices over the past six years • Averaged 11% annual Cash on Cash returns since inception • Averaged over 20% annual all in returns since inception • Scale delivers operational efficiencies • Alignment of interest – All partners have skin in the game Partnerships • Institutional investors we have provided our vertically integrated services to include: • Colony American Homes • Progress Residential • KKR / Beazer Pre-Owned Homes • Numerous family offices La Mesa Flip Profit: $50,345 San Diego Flip Profit: $50,548
  • 3. Pintar Investment Co./Vertical RE Platform Delivering consistent service across multiple markets through a vertically integrated services platform. 3 1 2 3 45 6 7 Strategic real estate investment advisory services Property Management/LeasingMortgage Lending Services Analytical & Valuation Services Escrow/Title Services Construction Management & Maintenance Brokerage operations
  • 4. The Search for Yield 4 “Those days” of believing 8% could be earned annually “aren’t here anymore,” said New York state Comptroller Thomas P. DiNapoli
  • 5. Single Family Residential Market Drivers • Employment increased on average by 241K per month which is 47K more per month than last year • Population and household growth outpacing housing supply – No New Homes being built • The Unemployment rate moved from where it was at the beginning of the year at 6.6% to 5.8% • US GDP on track for 2 to 3% Growth • Equity markets saw true earnings increase, not just multiple expansion • Demand for housing continues to increase – record number of new households being formed; population growth at record highs and millennial’ s are just beginning to come into maturity 5Source: J.P. Morgan – 2015 Economic & Market Outlook; Jan 2015 The housing market has rebounded from the depths. Consumer sentiment and deleveraging has picked up the pace.
  • 6. Real Estate Investments Driven by Fundamentals Not by Speculation U.S Population Growth 3 million per year Single Family Homes Built 500k Per year Home Prices UP U.S Economy and Home Buying Improving More people can afford to buy, but they choose to Rent Rent Rates UP Rental rates historically rise +/-5% Per year Vacancy rate for rental homes Below 5% Nationally Low Supply of Homes Lack of Quality Homes Available High Demand for Rent Low Supply of Rental Homes Higher Rent Rates
  • 7. The Opportunities in Investing in SFHs 7 Increasing Home Prices Rising Rent Rates PICR Fund III PICR Fund III provides investors an opportunity to own a portfolio of consistent, predictable cash flowing and appreciating residential properties while maintaining the flexibility to redeem their capital, not otherwise available in real estate assets More LiquidityCompounding Wealth Increasing Home Demand High Rental Demand Consistent Cash Stream More Cash Flow 5% +
  • 8. Allocate How You Make Money by Investing in Single Family Homes 8 Investors Invest PICR Invest PICR Fund III Residential Rental PICR collects rents from tenants and distributes quarterly dividends to investors PICR purchases, rehabs, and resells homes generating short-term cash return to investors House Flipping Dividend Investors receive +/- 11% Annual Cash on Cash Distribution *Based on historical past performance *
  • 9. Time to Load Up Single Family Homes Plenty of opportunities to buy Dollars for Seventy Cents. 9 “Single Family Homes – I would load up on them…it is a very attractive asset class now.” - Warren Buffet HOME PRICE APPRECIATION Appreciation has been strong, yet prices are still less than 75% of peak and replacement cost. HISTORICAL AFFORDABILITY Many tenants can afford to buy the home they rent, but can’t get credit or choose to rent and save their hard earned money. HIGH BARRIER TO ENTRY Very difficult to execute investment strategy without operational infrastructure and local market knowledge PRICE < REPLACEMENT COST Current market prices remains below replacement costs LACK OF NEW SUPPLY Despite significant household formation and population growth, new home build has been lagging historic averages by 1mm homes/ year for the past 5 years
  • 10. Widening Gap: Population Growth V.S. Housing Starts On average, population growth has been 4.7x new single home construction over the past 6 years from 2008 – 2014. 10 Source: Economic Data by The Federal Reserve Bank of Saint Louis 0 500 1000 1500 2000 2500 0 50 100 150 200 250 300 350 HousingStarts(ThousandUnits) TotalU.S.Population(Million) U.S. Population Grows Faster than Housing Starts Population Housing Starts - Single Family Housing Starts - Multi-Family Total Housing Starts New SFH Construction Population Growth Population Growth over (units) (person) New SFH Construction 2008 622 thousand 2.8 million 4.5x 2009 445 thousand 2.7 million 6.0x 2010 471 thousand 2.4 million 5.0x 2011 431 thousand 2.2 million 5.1x 2012 535 thousand 2.2 million 4.1x 2013 618 thousand 2.2 million 3.6x 2014 677 thousand 3.1 million 4.6x Total 3.799 Million 17.6 Million 4.6x Year
  • 11. Housing Shortage Supports HPA Median Home Price Appreciation (% change from one year ago) 11Source: Residential Economic Trends 2015 – National Association of Realtors We predict home prices will continue to rise 3% - 7% per annum throughout the next decade.
  • 12. SFR Rentals are 11.2% of the U.S Housing Stock Since 2007, U.S. homeownership has been steadily declining. Each % point decline represents a change in the living situation of ~1.1 million people. 12 Single- Family 14.9 Million 35% 2 to 9 Units 7.7 Million 30% 5 or More Units 17.9 Million 30% Mobile Homes 1.9 Million 5% What Type of Structure Do Renter Households Live in? Source: JBREC (U.S. Housing Analysis & Forecast Report), Q3 2014. Vacant: 13.9 Million 10% Renter Occupied 42.5 Million 32% Owner Occupied 76.9 Million 58% U.S. Housing Stock Totals: ~133M Units or $27.5 Trillion Market Vacant Renter-Occupied Owner-Occupied
  • 13. Not Enough Rental Homes to Keep Up with Growing Demand Housing shortage is expected to continue due to lack of new home construction. 13  Up to 5 million homeowners lost their homes to foreclosure since the real estate crash are now renters.  Landlords also are getting a boost from some of the 85 million millennials – 18 to 34 year-olds – who are starting out as renters rather than buyers.  Rents on all single-family homes and multifamily units are expected to climb 5% percent in 2015.  The U.S. rental-vacancy rate fell to 7.4% in Q3 2014, below 8%. The vacancy rate is below 5% in California, Nevada, and Arizona.  More and more people prefer the flexibility of renting and saving their hard earned dollars instead of creating liability of mortgage. Source: Washington Post – December 19, 2014 Increasing demand in a supply constrained market provides excellent opportunity for outsized returns!
  • 14. Surge in Renter Household Growth Renter household growth has averaged 770k annually since 2004. This makes 2004-2015 the best 10 year period for renter growth since the late 1980s. 14 “Rental Markets across the country are tightening, pushing up rents at the national level and across a majority of markets.”** Source: JCHS tabulations of US Census Bureau, Decennial Censuses and Housing Vacancy Surveys ** Quotes sourced from The State of the Nation’s Housing, Joint Center for Housing Studies, Havard University, June 26 2013
  • 15. The Western Region has the largest Renter Base in U.S. and also the highest average HH Income 15 2000 2014 Existing Home Sales 5.2M 5.1M New Home Sales 880k 445k Mortgage Rates 8.00% 3.85% Avg. Mortgage Payment* $1,187/mo $1,217/mo Sales Price $142k $207k Population 282M 319M * Based on 360 months loan term with 12% downpayment 1.2% property taxes, $800 home insurance Source: Current Population Survey/Housing Vacancy Survey, Series H-111, US. Census Bureau, Washington, DC
  • 16. California Has a Higher Percentage of Renters 16 17% 21% 22% 22% 22% 24% 26% 27% 27% 29% 29% 29% 29% 30% 30% 30% 32% 34% 38% 42% 29% MN WI NY IL NJ IN MI PA MO OH TX MD TN GA NC VA WA FL AZ CA US Single-Family Rental Rate 30-39 Age Cohort in Largest States Source: US Census Bureau, Zelman & Associated Analysis
  • 17. Western US is more stable and has a higher likelihood for rental growth Renters of Single Family Homes in PIC’s portfolio spend just 22.6% of income on housing costs vs a national average of 34%. The average HH income is $73,000 with an average rent of $1375/month. 17 Rental Expenditure 23% Income Net Rent 77% PICR's Tenants Contribution of Households Income to Renting Rental Expenditure 34% Income Net Rent 66% National Average Contribution of Households Income to Renting
  • 18. Declining Homeownership Rate Implies Rental Stability In Q3 2014, renter household growth = 1,239,314 vs. Owner Household Growth = -683,239. 18 Source: JLL Research, U.S. Census Bureau Zillow Analysis of U.S. Census, Bureau CPS Survey Data 1995-2014
  • 19. Median Age of Homeowners Has Increased to 44 Aside from the increase in the median age of homeowners, the average gross household income of homeowners has increased to $85,500. This is above the income of most new graduates - average income is $45,473. 19 2010 Profile 2011 Profile 2012 Profile 2013 Profile 2014 Profile Median Age 39 45 42 42 44 Gross HH Income $72,200 $80,900 $78,600 $83,300 $84,500 Household Composition 58% married couples, 20% single females, 12% single males, 8% unmarried couples 64% married couples, 18% single females, 10% single males, 7% unmarried couples 65% married couples, 16% single females, 9% single males, 8% unmarried couples 66% married couples, 16% single females, 9% single males, 7% unmarried couples 65% married couples, 16% single females, 9% single males, 8% unmarried couples Children in Home 35% 36% 41% 40% 35% Own a 2nd Home 14% 19% 19% 19% 21% Source: 2014 Profile of Home Buyers and Sellers, National Association of Realtors April 2014 Salary Survey, National Association of Colleges and Employers
  • 20. Despite Low Rates, It’s Difficult to Obtain a Mortgage As the mortgage credit availability shrank after the housing crisis, loan originations dropped almost 50% as compared to 2004, yet still exceeding $1.1 trillion in 2014! 20 - 10.00 20.00 30.00 40.00 50.00 60.00 70.00 80.00 90.00 0 200 400 600 800 1000 1200 1400 2000-Q1 2000-Q3 2001-Q1 2001-Q3 2002-Q1 2002-Q3 2003-Q1 2003-Q3 2004-Q1 2004-Q3 2005-Q1 2005-Q3 2006-Q1 2006-Q3 2007-Q1 2007-Q3 2008-Q1 2008-Q3 2009-Q1 2009-Q3 2010-Q1 2010-Q3 2011-Q1 2011-Q3 2012-Q1 2012-Q3 2013-Q1 2013-Q3 2014-Q1 2014-Q3 LoanOriginationsfromPurchaseas%ofTotal MortgageOriginations($Billion) Loan Origination (2000 - 2014) Mortgage Originations - Purchase Mortgage Originations - Refinance Loan Origination from Purchase as % of Total Source: Mortgage Bankers Association; Powered by AllRegs Market Clarity Economic Data by The Federal Reserve Bank of St. Louis
  • 21. Down Payment: The Biggest Obstacle for Young Renters 63% of Millennials lack the required 20% down payment to qualify for a traditional mortgage. 21 Estimated Upfront Cash Needed to Purchase a Home 2014 Starter Home Price: $292,700** 3.50% 5% 10% 20% Down Payment 10,245$ 14,635$ 29,270$ 58,540$ Closing Costs** Cash Reserve (0-6 months) Estimated Minimum Total Upfront Cash 12,647$ 17,037$ 31,672$ 60,942$ **Source: National Association of Realtors $2,402 $0-$4,458 Down Payment (% of Home Price) “It takes an average of 12.5 years to save up a 20% down payment – the usual requirement by banks – with the current personal savings rate of 5.6%”, according to a new research by real- estate firm RealtyTrac. Source: National Housing Survey, Fannie Mae
  • 22. Own a Piece of a Multi Million Dollar Portfolio Investors share ownership in all of PIC’s single family homes across multiple geographic regions. 22 Stratified by PSF of Properties Purple: <$50 Blue: $50 - $105 Light Blue: $105 - $150 Green: $150 - $200 Yellow: $200 - $250 Orange: $250 - $300 Red: $300 - $750 Southern California Homes Las Vegas Homes
  • 23. Diversify Your Real Estate Investment Portfolio 23 Buying a single house Joining a pool to invest in a bulk of houses VS All your money is locked in one property Your risk is concentrated all in one basket You have ownership in one single house All the troubles related to the house is on your shoulders You have ownership in ALL of PIC’s properties You have ownership in all of PIC’s properties in Southern California, Nevada, Georgia Plus: 11% Cash on Cash distribution AND your Return on Equity increases as value of homes appreciate Plus: Your risk is diversified throughout a portfolio of homes – not concentrated in one home Plus: All the expenses and harassments dealing with home repairs is on PIC – not your shoulders
  • 24. Adding Value through Professional Renovation 24 Front House Living Room Kitchen Backyard
  • 25. Newport Beach, California Flip Before Photos Front and Back of the House Inside House Kitchen and Bathrooms Front House Backyard Kitchen Master Bathroom Bathroom 1 Bathroom 2 Living Room Stairs Dining Room Family Room Master Bedroom Bed Room 2
  • 26. Newport Beach, California Flip During Construction Front and Back of the House Inside House Patio from Outside Patio from Inside Sideway 1 Sideway 2 Backyard Phase 1 Kitchen Family Room Living Room 1 Stairs and Family Room Living Room 2 Backyard Phase 2 Dining Room
  • 27. Newport Beach, California Flip After – Finished Product Front and Back of the House Inside HouseKitchen and Bathrooms Front House Backyard Kitchen Master Bathroom Bathroom 1 Bathroom 2 Living Room Stairs Dining RoomMaster Bedroom Garage and Sideway Platio Sideway
  • 28. Overview of Key Offering Terms of Fund 28 Fund Name: PICR Residential Fund III, LP Manager: PIC Renegade Properties, LLC Preferred Return: Investors earn an 6% preferred return on their invested balance. If our quarterly cash distribution is less than 6%, the balance will accrue to their capital balance and will be paid before any profit split Minimum Investment: $500,000 or other amount at the discretion of the Manager Redemption Rights: Annual Redemption Rights Asset Management Fee: 0.5% per annum Profit Splits: 70% to Investors and 30% to Manager after the 6% preferred return Distributions: Quarterly Target Leverage: Not to exceed 65% of value Return of Equity: Debt Proceeds on stabilized assets will return equity increasing investors ROE
  • 30. Management Team 30 Jeff Pintar – CEO and Founder at Pintar Investment Company Prior to founding PIC, Jeff was the National Retail Partner and member of the Investment Committee at Panattoni Development Company Inc. (PDC). During Jeff's tenure at PDC, the company developed and delivered over 40M square feet of new commercial projects valued in excess of $5B. Jeff began his real estate career with CB Richard Ellis and became one of the nation's leading revenue producers for the firm receiving Circle of Excellence awards in 1996 - 2003. In 1999 Jeff moved to Australia where he sat on the Asia Pacific Senior Leadership Board which oversaw the regions 20 offices and Retail Business Line. Jeff is active in YPO and serves as an Executive Member on the National Real Estate Network, ICSC and several charitable groups. John Kralik – Partner and Co-founder at Pintar Investment Company As founding partner, John is responsible for all operational aspects of the organization, acquisitions, disposition, and management of funds. John is an experienced leader in the real estate industry bringing with him over 10 years of real estate experience. Before joining Pintar Investment Company in 2009, John was president and owner of JT Investment Properties in Los Angeles, specializing in the acquisition and disposition of trustee sale single family residences through Southern California. Prior to joining JT Investment Properties, John was a Vice President at DC Commercial in Century city for five years, specializing in the acquisition and sale of retail and office properties in Los Angeles County. John earned a Bachelor of Administration from Loyola Marymount University in Los Angeles.
  • 31. Investing in Our Funds Has Risks – Please Review 31 Your potential interest in this investment opportunity (your “Interest”) is speculative and involves risk. You should carefully read this memorandum and, if one has been provided, review the Proforma for the Interest (“Proforma”), including the assumptions thereto, before purchasing the Interest. The Proforma consists of “forward–looking” statements that are based on various assumptions regarding future operation and management of the Subject Project, such as renovations, marketing and certain budgeted expenditures. These forward-looking statements may not accurately predict future events or the actual performance of the Subject Project. It is possible that you could incur a complete loss of your investment and you should be able to financially bear such a loss. In addition, any projections and representations written or oral, which do not conform to those contained in the investment proposal must be disregarded. You should consider carefully, among other risks, the following risks, and should consult with your own legal, tax, accounting and financial advisors before investing in the Interest. These risk factors, or other events, could cause actual results to differ materially from those discussed in this memorandum. You should consult with an attorney and a tax advisor prior to purchasing the Interest in order to examine the full extent of any potential tax and legal consequences relating thereto. This memorandum is not intended to provide you with any individual legal or tax advice, nor is it intended to provide an all-inclusive discussion of the possible risks relative to your individual circumstances.
  • 32. Risks of Investing in Real Estate 32 General Risks of Investment in the Subject Project Cash flow will be derived from the resale of properties and/or rental payments. Payments to you will be contingent on the Subject Project’s successful operation; therefore, the economic success of an investment in the Interest will depend directly upon the resale market and/or lease or leases. A failure to sell a property and/or a vacancy by a tenant that is not replaced or is replaced at less attractive terms can adversely affect operating results or render the sale or refinancing of the Subject Project difficult or unattractive. No assurance can be given as to the accuracy of certain assumptions related to the future sale and/or occupancy of the Subject Project by tenants or the ability of such tenants’ to pay rents or costs for the Subject Project, as these matters will depend on events and factors possibly beyond the control of the limited liability company members. Such factors include continued validity and enforceability of the lease in the event a tenant defaults thereunder, the financial resources of the tenant, adverse change in local population trends, market conditions, neighborhood property values, local economic and social conditions, supply and demand for property similar to the Subject Project, competition from similar properties, environmental hazards and liabilities caused by third parties, interest rates and real estate tax rates and assessments, governmental rules, regulations and fiscal policies, zoning restrictions, the enactment of unfavorable environmental or hazardous material laws, labor and material costs, uninsured losses, effects or inflation and other risks.
  • 33. Risks of Investing in a Private Offering 33 Sale of Interests You will be required to represent that you are acquiring the Interest for investment purposes and not with a view to distribution or resale (of your Interest), and that you can bear the economic risk of investment in the Subject Project for an indefinite period of time. This representation is required because the Interest has not been registered under any state “Blue Sky” or securities laws, and cannot be sold unless they are subsequently registered or an exemption from such registration is available. In addition, there is no guarantee that a market will exist for the Interest, and you cannot expect to be able to liquidate your investment in case of an emergency. Further, the sale of the Interest may have adverse federal income tax consequences to you. Offering Not Registered With Securities and Exchange Commissioner or State Securities Commissions The Interest will not be registered with the SEC or any state securities commission. The Interest is being offered in reliance upon an exemption from the registration provisions of the Act and state securities laws applicable only to offers and sales to prospective members meeting the suitability requirements set forth herein. Since this is a nonpublic offering and, as such, is not registered under federal or state securities laws, prospective members will not have the benefit of review or comment by the SEC or any state securities commission. Private Offering Exemption – Compliance with Requirements The Interest is being offered and will be sold to you in reliance upon a private offering exemption from registration provided in the Act and state securities laws. If PIC should fail to comply with the requirements of such exemption, you will have the right, if you so desire, to rescind your purchase of the Interest. It is possible that if your rescission succeeds, PIC may not have sufficient funds to pay for such rescission. Your right to rescission might also fall under applicable state securities or “Blue Sky” laws and regulations in states where the Interest will be offered without registration or qualifications pursuant to a private offering or other exemption.
  • 35. Pintar Investment Company Local Stats Update | Orange County, Los Angeles County, Riverside County, San Bernardino County, San Diego County, and Clark (Las Vegas) County|
  • 36. Housing Shortage - Clark County, NV 36 2014 2000 New & Existing Home Sales (SFH & Condos) 51,789 67,400 Mortgage Rates 3.85% 8% Avg. Mortgage Payment* 1,221$ 1,171$ Sales Price 196,816$ 140,000$ Population 2,056,000 1,393,000 *Based on 360 months loan term with 12% down payment 1.2% property taxes, and $800 home insurance Source: U.S Census Bureau, Population & Building Permits by County U.S Department of Housing and Urban Development – Office of Policy Development and Research, Las Vegas, NV Year New SFH Construction (units) Population Growth (person) Population Growth/New SFH Construction 2008 5,840 40,000 6.8x 2009 3,777 24,000 6.4x 2010 4,623 50,000 10.8x 2011 3,817 14,000 3.7x 2012 6,108 31,000 5.1x 2013 7,067 30,000 4.2x 2014 6,623 28,000 4.2x Total 37,855 217,000 5.7x
  • 37. Unemployment Rate – Clark County 37 Jul 2010 14.5% Dec 2014 6.9% Dec 2014 5.4% Jul 2010 10.6% Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
  • 38. SFH Sales and Permits in Clark County, NV 38 SFH Permitting Is Well Below Historical LevelMLS Home Sales (in thousands per quarter) Source: Greater Las Vegas Association of Realtors, Southern Nevada Real Estate Report, Q2 2014 HUD PD&R, Housing Market Profiles, February 2014
  • 39. Homeownership Rate – Clark County, NV 39 Own 59.10% Rent 40.90% 2000 Own 51.91% Rent 48.09% 2013 Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000 Pedia City, Homeownership Rate for Clark County, NV 2013
  • 40. Housing Shortage - Orange County 40 Source: U.S Census Bureau National Association of Realtor – Profile of Orange County Southern California Association of Government – Orange County Profile 2014 2000 New & Existing Home Sales (SFH & Condos) 33,844 24,500 Mortgage Rates 3.85% 8% Avg. Mortgage Payment* 3,290$ 2,576$ Sales Price 580,000$ 318,000$ Population 3,010,232 2,846,289 *Based on 360 months loan term with 12% down payment 1.2% property taxes, and $800 home insurance Year New SFH Construction (units) Population Growth (person) Population Growth/New SFH Construction 2008 1,298 16,321 12.6x 2009 1,339 16,484 12.3x 2010 1,553 19,427 12.5x 2011 1,898 18,614 9.8x 2012 3,910 26,946 6.9x 2013 3,641 29,708 8.2x 2014 3,660 33,940 9.3x Total 17,299 161,440 9.3x
  • 41. Unemployment Rate – Orange County 41 Jul 2010 9.9% Dec 2014 4.5% Dec 2014 5.4% Jul 2010 10.6% Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
  • 42. Household Relocation - Orange County – Flight to Suburbs 42 Source: National Association of Realtors, Internal Revenue Service 2013
  • 43. Homeownership – Orange County 43 Own 61.40% Rent 38.60% 2000 Own 58.60% Rent 41.40% 2014 Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000 First Tuesday Journal; Orange County Housing Indicators, February 2014
  • 44. Housing Shortage - Los Angeles 44 Source: U.S Census Bureau National Association of Realtor – Profile of Los Angeles Southern California Association of Government – Los Angeles County Profile 2014 2000 New & Existing Home Sales (SFH & Condos) 76,065 52,000 Mortgage Rates 3.85% 8% Avg. Mortgage Payment* 2,901$ 1,770$ Sales Price 510,000$ 215,900$ Population 10,117,239 9,543,000 *Based on 360 months loan term with 12% down payment 1.2% property taxes, and $800 home insurance Year New SFH Construction (units) Population Growth (person) Population Growth/New SFH Construction 2008 3,527 44,000 12.5x 2009 2,099 69,000 32.9x 2010 2,439 (22,000) NA 2011 2,370 59,000 24.9x 2012 4,370 67,000 15.3x 2013 3,839 65,068 16.9x 2014 4,460 100,171 22.5x Total: 23,104 382,239 16.5x
  • 45. Unemployment Rate – Los Angeles 45 Jul 2010 13.3% Dec 2014 7.5% Dec 2014 5.4% Jul 2010 10.6% Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
  • 46. Household Relocation – Los Angeles – Flight to Suburbs 46 Source: National Association of Realtors, Internal Revenue Service 2013
  • 47. Homeownership – Los Angeles 47 Own 47.90%Rent 52.10% 2000 Own 49.10% Rent 50.9% 2014 Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000 First Tuesday Journal, Los Angeles Housing Indicators, February 2015
  • 48. Housing Shortage - Riverside 48 Source: U.S Census Bureau National Association of Realtor – Profile of Riverside County Southern California Association of Government – Riverside County Profile 2014 2000 New & Existing Home Sales (SFH & Condos) 36,627 17,500 Mortgage Rates 3.85% 8% Avg. Mortgage Payment* 1,857$ 1,160$ Sales Price 322,020$ 138,560$ Population 2,189,000 1,545,387 *Based on 360 months loan term with 12% down payment 1.2% property taxes, and $800 home insurance Year New SHF Construction (units) Population Growth (person) Population Growth/New SHF Construction 2008 3,817 32,000 8.4x 2009 3,386 37,000 10.9x 2010 4,031 34,641 16.0x 2011 2,690 46,359 17.2x 2012 3,107 29,000 9.3x 2013 4,432 28,000 6.3x 2014 5,000 31,000 6.2x Total 26,463 238,000 9.0x Year New SFH Construction (units) Population Growth (person) Population Growth/New SFH Construction 2008 3,817 32,000 8.4x 2009 3,386 37,000 10.9x 2010 4,031 34,641 16.0x 2011 2,690 46,359 17.2x 2012 3,107 29,000 9.3x 2013 4,432 28,000 6.3x 2014 5,000 31,000 6.2x Total 26,463 238,000 9.0x
  • 49. Unemployment Rate – Riverside 49 Jul 2010 15.2% Dec 2014 7.2% Dec 2014 5.4% Jul 2010 10.6% Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
  • 50. Household Relocation – Riverside – Growing Again 50 Source: National Association of Realtors, Internal Revenue Service 2013
  • 51. Homeownership – Riverside – Large renter population 51 Own 68.90% Rent 31.10% 2000 Own 59.00% Rent 41.00% 2014 Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000 First Tuesday Journal; Riverside Housing Indicators, February 2014
  • 52. Housing Shortage - San Bernardino 52 Source: U.S Census Bureau National Association of Realtor – Profile of San Bernardino County Southern California Association of Government – San Bernardino County Profile Year New SFH Construction (units) Population Growth (person) Population Growth/New SFH Construction 2008 2,056 18,163 8.8x 2009 1,430 13,597 9.5x 2010 1,198 13,688 11.4x 2011 1,066 15,526 14.6x 2012 1,990 20,694 10.4x 2013 2,040 28,663 14.1x 2014 2,180 36,079 16.6x Total 11,960 146,410 12.2x 2014 2000 New & Existing Home Sales (SFH & Condos) 25,900 16,500 Mortgage Rates 3.85% 8% Avg. Mortgage Payment* 1,267$ 1,160$ Sales Price 216,020$ 138,560$ Population 2,088,371 1,709,434 *Based on 360 months loan term with 12% down payment 1.2% property taxes, and $800 home insurance
  • 53. Unemployment Rate – San Bernardino 53 Jul 2010 14.8% Dec 2014 7% Dec 2014 5.4% Jul 2010 10.6% Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
  • 54. Household Relocation – San Bernardino 54 Source: National Association of Realtors, Internal Revenue Service 2013
  • 55. Homeownership – San Bernardino 55 Own 64.50% Rent 35.50% 2000 Own 58.20% Rent 41.00% 2014 Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000 The Community Foundation, San Bernardino County, Community Indicators Report 2014
  • 56. Housing Shortage - San Diego 56 Source: U.S Census Bureau National Association of Realtor – Profile of San Diego Southern California Association of Government – San Diego County Profile Year New SFH Construction (units) Population Growth (person) Population Growth/New SFH Construction 2008 2,361 43,000 18.2x 2009 1,778 35,000 19.7x 2010 2,270 50,000 22.0x 2011 2,245 35,000 15.6x 2012 2,197 37,000 16.8x 2013 2,570 35,000 13.6x 2014 2,480 38,532 15.5x Total 15,901 273,532 17.2x 2014 2000 New & Existing Home Sales (SFH & Condos) 38,350 20,000 Mortgage Rates 3.85% 8% Avg. Mortgage Payment* 2,568$ 2,192$ Sales Price 450,000$ 269,410$ Population 3,150,178 2,825,000 *Based on 360 months loan term with 12% down payment 1.2% property taxes, and $800 home insurance
  • 57. Unemployment Rate – San Diego 57 Jul 2010 10.9% Dec 2014 5.2% Dec 2014 5.4% Jul 2010 10.6% Source: U.S. Bureau of Labor Statistics: Unemployment Rate – Not Seasonal Adjusted, February 5 2015.
  • 58. Household Relocation – San Diego 58 Source: National Association of Realtors, Internal Revenue Service 2013
  • 59. Homeownership – San Diego 59 Own 55.40% Rent 44.60% 2000 Own 53.90% Rent 46.10% 2014 Source: U.S. Census Bureau, American FactFinder, General Housing Characteristics: 2000 First Tuesday Journal; San Diego County Housing Indicators, February 2014
  • 60. Pintar Investment Company Investor Relations www.pintarinvestmentcompany.com Kevin Sharp Investor Relations 27372 Calle Arroyo San Juan Capistrano, CA 92675 Direct/Fax 949.284.0838 | Mobile 949.877.4112 ksharp@pintarinvestco.com Jeff Pintar CEO 27372 Calle Arroyo San Juan Capistrano, CA 92675 Office 949.276.4166 | Direct 949.284.0284 jpintar@pintarinvestco.com