C O R P O R A T E O V E R V I E W

Transcription

1 CORPORATE OVERVIEW

2 YOU INVEST WHERE WE INVEST The principals of Telos invest side by side with investors and are generally the largest investors in our projects. We target discounted, value-add, or opportunistic private real estate investments across all asset class sectors.

3 TELOS CAPITAL OFFERINGS INVESTMENT NAME ASSET CLASS ASSET LOCATION INVESTMENT DESCRIPTION BASE-CASE PROJECTED ANNUAL RETURNS Telos Capital Fund 1 Diversified Fund Various This fund makes an investment in each of the Telos offerings and is currently diversified in RV parks, multifamily, student housing, retail, entertainment, and industrial properties. 15.0% + TCF2 Stella Mare RV Park Galveston, TX Redevelopment of residential infrastructure into a best-inclass, 197-site RV resort on Galveston Island in Texas. 20.3% TCF3 Apartments at the Venue* Valley, AL Investment in a deeply discounted 618-unit Class A apartment complex on approximately 54 acres in Valley, AL. 14.6% TCF4 Stadium View Suites* Student Housing Ames, IA Acquisition and development of a high-end student housing project with 197 units and 518 beds located near the heart of Iowa State University in Ames, IA. 18.7% TCF5 Monrovia Retail Monrovia, CA Acquisition and repositioning of a prime off-market 98,000-square-foot retail shopping center in Monrovia, CA. 20.1% TCF6 Constitution Road Studios Special Purpose Atlanta, GA Acquisition and repurposing of an existing industrial warehouse property and development of over 200,000 square feet of purpose-built movie studios in Atlanta, GA. 24.5% TCF7 Carolinas North and South Carolinas Off-market acquisition of 15 Class B apartment communities totaling 2,272 units at a significant discount to replacement cost located in the Carolinas. 15.8% TCF8 733 East Huntington Dr Retail Monrovia, CA Senior secured loan on a below-market ground lease currently tenanted by Taco Bell in Monrovia, CA. 9.0% TCF9 Milford, MA Milford, MA Acquisition of a Class B apartment community totaling 304 units in Milford, MA, with immediate value-add upside potential. 14.0% TCF10 Real Estate Fund Diversified Fund Various This fund makes an investment in each of the Telos offerings, including RV parks, multifamily, student housing, retail, entertainment, and industrial properties. 15.0% + TCF11 Kirkwood Student Housing Student Housing Cedar Rapids, IA Investment in a portfolio of three value-add student housing properties totaling 740 units near Kirkwood Community College in Cedar Rapids, IA. 14.3% TCF12 Columbus Industrial Industrial Columbus, OH Investment in a 1-million-square-foot industrial warehouse facility located in Columbus, OH, with 11%+ in-place annual cash flow and future re-tenanting upside potential. 15.4% TCF13 Watermark Midwest Investment in a portfolio of Class B and Class C apartment communities at significant discount to replacement cost located across the Midwest. 16.8% *TCF4 Stadium View Suites Investment has gone full cycle as of December 2017, resulting in a net IRR to investors of 27%+. TCF3 Apartments at the Venue is under contract as of December 2017 and is anticipated to generate a net IRR to investors in line with projections. Projected returns are not guaranteed. Past performance is not necessarily indicative of future performance.

4 STADIUM VIEW SUITES TELOS FULL-CYCLE HIGHLIGHT High-end 518-bed student housing infill development located near the heart of Iowa State University in Ames, IA. PROPERTY DESCRIPTION Status: Type: Location: Class Type: Sold Student Housing Ames, IA Class A Year Built: Number of Beds: 518 INVESTMENT DATE AND AMOUNT Investment Date: Oct 15 Telos Investment: Telos Principal % of Investment: $3 million 10.87% INVESTOR INTERNAL RATE OF RETURN Downside- Case Projected Base- Case Projected Actual Investment Background: Stadium View Suites is a luxury student housing development composed of 518 beds on the southeast side of Iowa State University, centrally located less than a 10-minute walk to Iowa State athletic facilities, retail, and restaurants. Execution: The total development consists of 197 units and 518 beds, with the property s 2nd phase construction completed as of July The property was 99% occupied for the academic year and is 99% pre-leased for the academic school year with all 12-month leases. Results: The property was anticipated to generate a net annual cash flow on investor equity of approximately 11% (18% including principal amortization) for the school year. The property was sold as of December 2017 with net investor IRRs in excess of 27%, outperforming even our upside-case IRR projections of 23.04% 13.69% 18.67% 27%+ Past performance is not necessarily indicative of future results.

5 STELLA MARE RV RESORT 5-star, 197-site luxury RV resort development in Galveston, TX, with significant cash flow and future development upside potential. PROPERTY DESCRIPTION Status: Active Type: RV Park Location: Galveston, TX Class Type: Class A Year Built: 2016 Number of Sites: 197 INVESTMENT DATE AND AMOUNT Investment Date: Dec 2015 Telos Investment: $4.9 million Investment Background: Stella Mare is a rare 25-acre property with 25-foot-wide guttered and concrete-paved streets on Galveston Island with significant stabilized cash flow potential (20%+ cap rate). Execution: The RV resort was opened on September 2016, approximately 9 months following closing on the land. It offers a bestin-class experience to guests, with permanently unobstructed gulf and bay views, a superior infrastructure, and high-end amenities. Results: Stella Mare is already rated #1 in Specialty Lodging on the Island by TripAdvisor and was refinanced in March 2017, producing nearly $3.0MM of net refinance proceeds, representing 59% of invested equity within 15 months of the land acquisition. Telos Principal % of Investment: 7.81% BASE-CASE PROJECTED RETURNS Projected Investor IRR: 20.31% Projected Investor Multiple: 1.55x Projected Hold Period: 5 years

6 APARTMENTS AT THE VENUE Investment in a 618-unit Class A apartment community in Valley, AL, at a significant discount to replacement cost with upside potential. The property was acquired for $71k per unit, approximately 45% lower than the developer s original cost to build. Through improved management and cost-cutting measures, net operating income has increased 20% in under 2 years of ownership. The project is currently earning annualized net cash flow on investor equity of 10%+ and is under contract for sale as of January CAROLINAS MULTIFAMILY Off-market acquisition of 15 Class B apartment communities, totaling 2,272 units, located in the Carolinas. The portfolio was acquired at a significant discount to replacement and market value at $51k/unit and a 7.9% cap rate. The Investment initial cash flows have been in the 8 10+% range, with significant growth potential through renovations. Upon execution of the business plan, value is anticipated to be extracted through a combination of sales and refinances. WATERMARK MULTIFAMILY Investment in a portfolio of Class B and Class C apartment communities at significant discount to replacement cost located across the Midwest. The fund portfolio s investment year-1 anticipated annual cash flow is 9%+ to investors with significant value-added upside potential. The fund targets undermanaged Class B and Class C acquisitions in the 7 9% cap rate range that can be stabilized in the 10 12% range with light renovations, operating efficiencies, and enhanced management. Average portfolio price per unit is approximately $32,500.

7 KIRKWOOD STUDENT HOUSING Investment in a portfolio of three value-add student housing properties totaling 740 units near Kirkwood Community College in Cedar Rapids, IA. The properties are projected to generate investor cash flow of 7%+ in year 1, with the ability to grow in excess of 12 15% per year on outstanding capital after the value-add and refinance plans are implemented. The acquisition represents significant potential to increase rental rates through increased control of the student housing market (55% current market share). Operating synergies are also anticipated by combining management to reduce expenses considerably across the portfolio. COLUMBUS INDUSTRIAL 1-million-square-foot industrial warehouse in Columbus, OH, with 11%+ in-place annual cash flow and future re-tenanting upside potential. INVESTMENT DATE AND AMOUNT Investment Date: May 2017 Telos Investment: Telos Principal % of Investment: $6.3 million 10.12% The property was purchased at less than $30 per square foot, representing a significant discount to replacement cost of approximately $45 50 per square foot. Year-1 investor cash flow is in excess of 11%. BASE-CASE PROJECTED RETURNS Net Investor IRR: 15.37% Net Investor Multiple: 1.67x Projected Hold Period: 4 years Given the high demand for this type of warehouse space, the limited available space in the Columbus market, and the rapid yearover-year growth of the e-commerce industry, our underwriting projects that a re-tenanting event will be more accretive to investor annual returns than the current cash flow from Sears tenancy.

8 MONROVIA Prime off-market Southern California retail property with the ability to rapidly lease vacant spaces to national-credit retailers and sell upon stabilization. Investment Background: The project was acquired at a discount due to low occupancy as a result of the loss of Albertsons grocery. Prior to acquisition of the center, letters of intent with ALDI and TJX Companies (both trade at investment-grade cap rates) were obtained, which would bring total nationalcredit retailer occupancy to 75% for the shopping center. Execution: Both ALDI and TJX leases were executed subsequent to acquisition, and landlord improvement work and tenant improvement work are nearing completion. TJ Maxx and HomeGoods are open for business as of October 2017, and ALDI has also opened for business as of December We have obtained a letter of intent for the last available space from ULTA Beauty at a premium rent given the presence of the ALDI and TJX leases. Investment brokers have been engaged, and the property is anticipated to be sold in E HUNTINGTON DRIVE Senior secured first mortgage on a ground lease currently tenanted by Taco Bell with rent that is significantly below market in Monrovia, CA. Acquisition and financing of a significantly below-market ground lease that is an outlot for the shopping center reposition of the TCF5 Monrovia investment. Given the value-add to the shopping center from the new national-credit leases, this parcel is expected to dramatically increase in value due to added traffic to the shopping center. In addition, the below-market rent provides future upside to a buyer of the shopping center and is expected to create a synergy premium when executing the TCF5 Monrovia sale.

9 CONSTITUTION ROAD STUDIOS Development of purpose-built movie studios targeting feature film and TV productions in Atlanta, GA, with significant cash flow and upside potential. PROPERTY DESCRIPTION Status: Type: Location: Class Type: Active Special Purpose Atlanta, GA Class A Year Built/Renovated: Number of Movie Studios: 9 INVESTMENT DATE AND AMOUNT Investment Date: Feb 2016 Telos Investment: Telos Principal % of Investment: $5 million 14.30% BASE-CASE PROJECTED RETURNS Projected Investor IRR: 24.53% Projected Investor Multiple: 2.74x Projected Hold Period: 10 years Investment Background: The investment includes 176,000 square feet of office and industrial space and the development of nine movie studios totaling over 200,000 square feet. Despite how Georgia is producing more feature films than any other state, there are few purpose-built studios in Atlanta that cater to this growing demand. Market rents for purpose-built studios are approximately $ per square foot per month. The property has been well received due to its convenient location within seven miles of the airport and downtown Atlanta. Execution: According to our joint venture operator, within 20 months of our investment, the project has completed development and has signed leases with major production companies including Disney, Sony, Legendary Pictures, and Lionsgate, with average lease rates of $3.52 per square foot per month. See Results: According to our joint venture operator, the project became 100% pre-leased in October 2017 and has soft holds on the available studio space for the 2018 year.

10 MILFORD, MA, MULTIFAMILY Investment in a 304-unit Class B multifamily property in Boston MSA with immediate value-add upside potential. PROPERTY DESCRIPTION Status: Type: Location: Class Type: Active Milford, MA Class B Year Built: 1972 Number of Units: 304 INVESTMENT DATE AND AMOUNT Investment Date: Mar 2017 Telos Investment: Telos Principal % of Investment: $7 million 10.25% BASE-CASE PROJECTED RETURNS Projected Investor IRR: 14.05% Projected Investor Multiple: 2.59x Projected Hold Period: 10 years Investment Highlights: Initial cash flow is projected to be in excess of 7.0% with the potential to return substantial capital through a refinance after execution on value-add potential: Revenue Growth Potential: 23% of units are $410 per month below market due to a previous state-subsidized affordability program. Bringing these units to market would generate an 11% increase to annual NOI. Expense Tightening: The property currently pays for all utilities, a benefit no competing property offers. We anticipate separately metering and billing residents for utilities. Capital Improvements: Over $1.8 million is designated for upgrades and repositioning the property to achieve its market rent potential. Execution: In May 2017, the Milford Housing Authority agreed to bring the Enhanced Vouchers (27% of the overall affordable units) directly to the property s full-market rent (an average increase of approximately 15 20%). The full impact of this revenue increase is expected to be felt in future periods and represents a financial benefit to the property without having to incur the underwritten vacancy and turnover costs.

11 TELOS CAPITAL TEAM DAVID FISHER, CPA MANAGING MEMBER David enjoyed a successful career in banking and finance for 20 years before focusing on the management success of Telos Capital and his own investments. Over the years, David and his banking teams have executed international financings in excess of $8 billion. He has been an active real estate investor for the past 15 years and has interests in over 50 partnerships across 27 states. He earned national honors with the Elijah Watt Sells Award on the May 1993 CPA exam. JOSHUA UNGERECHT MANAGING MEMBER Joshua is focused on the operations, investment structuring, and acquisitions aspects of Telos Capital. Concurrently, he serves as CEO and Chief Investment Officer over a number of integrated wealth management and securitized real estate companies. He developed one of the industry s leading due diligence platforms in securitized real estate analysis. He also maintains Series 7, 22, 24, 63, 65, and 79 Securities Licenses and an active California real estate broker s license. WARREN THOMAS, CPA MANAGING MEMBER Warren is the co-founder and president over a number of integrated wealth management and securitized real estate companies with Joshua Ungerecht and is focused on the securitization, broker dealer, and registered representative relations sides of the business. Warren has over 35 years of experience as a CPA and has been an active commercial real estate investor for the past 20 years. He maintains Series 6, 7, 22, 24, 39, 63, 66, and 79 Securities Licenses. KEY MANAGEMENT BROKER DEALER RELATIONS DAVE VAN STEENIS, CPA, CFA CHIEF FINANCIAL OFFICER SUSANA DRYDEN CHIEF OPERATING OFFICER KEVIN STEINES, CPA CONTROLLER GEOFFREY D. FLAHARDY DIR OF NATL ACCOUNTS BETH VELOZ SR VICE PRESIDENT DAVID MCCURDY SR VICE PRESIDENT ASSET MANAGEMENT ACQUISITIONS CHARLES KIM VP, ASSET MANAGEMENT CHRIS WISE SR ASSET MANAGER KELLY ANN PEPIN ASSET MANAGER KATHLEEN JU ASSET MANAGER JENNIFER CHASE DIR OF ACQUISITIONS ANTOINETTE BACA ACQUISITIONS COORDINATOR BRIAN SHERIFF SR ANALYST RAHSAANA ALLEN GENERAL COUNSEL COMMUNICATIONS AND TECHNOLOGY MERYL MAGLAYA VICTOR SANTOS CAROL YIP ASSET MANAGER REIMBURSEMENT COORDINATOR ASSET MANAGER WILLIAM PRATHER RALPH POLENDO MATTHEW ANDERSON IT MANAGER/NETWORK ADMIN CREATIVE DIRECTOR JUNIOR DESIGNER ACCOUNTING INVESTOR RELATIONS CARRIE GARCIA SR ACCOUNTANT JANE CAVANAUGH SR ACCOUNTANT JULIET MELIKIAN STAFF ACCOUNTANT CHRISTIE BURROW EXECUTIVE ASSISTANT JOANNA KU ADMIN ASSISTANT JANESSA DE LA RIVA INVESTOR RELATIONS ASSOC

12 REV 1/18 States with Telos and affiliates AUM or under contract for future investment inventory. FOCUS ON DISCOUNTED, VALUE-ADD, OR OPPORTUNISTIC PRIVATE REAL ESTATE INVESTMENTS $1.1+ BILLION OF ASSETS UNDER MANAGEMENT INVESTED ACROSS 400+ PROPERTIES 10+ MILLION SQUARE FEET UNDER MANAGEMENT DIVERSIFIED ACROSS 28 STATES Past performance is no guarantee of future results. Projected returns are not guaranteed and could be lower than anticipated. This material is not a recommendation or solicitation to buy any security, as all such offers can be made only by a private placement memorandum. Please review the private placement memorandum, especially including the risk sections, for any offering before considering an investment. All potential investors in any offering provided by Telos Capital must read the investment-specific private placement memorandum, and no person may invest in a Telos Capital Offering without first acknowledging receipt and review of the investment-specific private placement memorandum in its entirety SOUTH LOS ROBLES AVE., SUITE 210, PASADENA, CA PHONE: (855) FAX: (626)