Confidential Investment Summary
Important Notices and Disclosures
AVA BENESOCKY Managing Partner 604-828-8302 ava@cpicapital.ca
SOHEIL “AUGUST” BINIAZ Managing Partner 604-363-4797 august@cpicapital.ca
This document is confidential and may not be reproduced or redistributed. The information presented herein has been prepared for informational purposes only and is not an offer to buy or sell, or a solicitation of an offer to buy or sell any security or fund interest or any financial instrument and is not to be considered investment advice. This presentation is for institutional use only and is not to be distributed to any party other than its intended recipient. The following materials present information regarding a proposed creation of a special purpose vehicle (the “Issuer”) which would offer securities (the “Securities”) to indirectly finance its acquisition of a portfolio of financial assets to be selected and managed by the portfolio manager referred to herein (the “Manager”). These materials have been prepared to provide preliminary information about the Issuer and the transactions described herein to a limited number of potential underwriters of the Securities for the sole purpose of assisting them to determine whether they have an interest in underwriting the Securities. Forward-Looking Statements This document includes “forward-looking statements” and “forward-looking information” (collectively, “forward- looking statements”) and “financial outlook” within the meaning of applicable securities laws. All statements other than statements of historical facts included in this document, including, without limitation, statements regarding the future financial position, targeted or projected investment returns, business strategy, budgets and projected costs of the Partnership and plans and objectives of the Partnership for further operations, are forward-looking statements or financial outlook. In addition, forward-looking statements and financial outlook generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “forecasted,” “projected,” “estimate,” “anticipate,” “believe,” or “continue” or the negative usages thereof or variations thereon or similar terms, although not all forward-looking statements or financial outlook contain these identifying words. Forward-looking statements and financial outlook reflect our current expectations and assumptions as of the date of the statements and are subject to a number of known and unknown risks, uncertainties and other factors, including, without limitation, those listed under the heading “Risk Factors” below, many of which are beyond our control, which may cause actual results, performance or achievements to be materially different from any anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Although we believe that the assumptions on which the forward-looking statements are made and the financial outlook is based, including, without limitation, those assumptions listed under heading “Assumptions” below, are reasonable, based on the information available to it on the date such statements were made, no assurances can be given as to whether these assumptions will prove to be correct. Given these uncertainties, readers are cautioned that forward-looking statements and financial outlook contained herein are not guarantees of future performance; accordingly, readers should not place undue reliance on forward-looking statements or financial outlook. To the extent any forward-looking statements in this this document constitute “financial outlook” within the meaning of applicable securities laws, such information is being provided, so that readers are aware of management’s current estimate of future financial performance of the Partnership (which estimates are subject to change). We will not update any forward-looking statements or financial outlook except as, and to the extent, required by applicable securities laws. The forward-looking statements and financial outlook contained herein, and all subsequent written and oral forward-looking statements and financial outlook attributable to the Partnership, or persons acting on any of their behalf, are expressly qualified in their entirety by this cautionary statement. No representation or warranty is made by the Partnership as to the accuracy or completeness of any of the information contained herein. No securities commission or similar regulatory authority has passed on the merits of the securities referred to hereunder and any representation to the contrary is an offence. In considering the prior performance information contained herein, prospective investors should bear in mind that past performance is not necessarily indicative of future results, and there can be no assurance that the Partnership will achieve comparable results. Risk Factors Investment in the Partnership involves a high degree of risk and is suitable only for sophisticated investors who can withstand the loss of their entire investment and requires the financial ability and willingness to accept the high risks and lack of liquidity inherent in an investment in the Partnership. No assurance, representation or warranty can be given that the Partnership’s investment objectives will be achieved or that investors will receive a return of their capital. An investment in Units is subject to risk. Standard risks applicable to investments of this nature include: 1.No market for Units: There is currently no resale market for the Units and it is not guaranteed that any market will develop. The Units are not transferable without the approval of General Partner and in compliance with applicable securities laws and regulations.
2.Vacancy Rates: The apartment building business relies on a steady supply of good quality tenants. A shortage of quality tenants due to an economic downturn or job losses in a given marketplace could result in higher than expected vacancy and lower than expected revenue. 3. No guaranteed return: The projected returns described in this Investment Summary are not guaranteed. An investment in Units is not suitable for investors who cannot afford to assume significant risks in connection with their investments. 4. Tax matters: Investors should consult their own tax advisors for advice with respect to the tax consequences of an investment in the units based on their particular circumstances. 5. The Partnership: intends to acquire units in a USLP (Investment), Delaware limited partnership, and the Partnership will own units in the 6.USLP (Investment). In the event of a refinancing of the property, the Partnership will be entitled to participate in the net proceeds of the refinancing on a pari passu basis. Subject however, to the final terms of the USLP (investment) agreement which may include a Preferred Equity Partner that may receive preferred preferential rights of return (see Two-Tiered Equity Structure for more details). For more information, investors are advised to review the agreements governing the relationships described herein. 7.Covid-19: As the impact and extent of the COVID-19 outbreak is not known as of the date of this document, all forward looking statements in this document are qualified by the risks associated with the COVID-19 outbreak. There is significant risk that the COVID-19 outbreak will cause the assumptions underlying the forward-looking information in this document to change and the actual results and performance of the Partnership to differ materially from the forward-looking statements contained herein.
Assumptions Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward- looking statements and financial outlook contained herein include that: building upgrade plans and related expenses will proceed as anticipated; the Partnership will remain in good standing with respect to its obligations to any senior lenders; the general economy is stable; local real estate conditions are stable; interest rates are relatively stable; equity and debt markets continue to provide access to capital; and that the Partnership’s expenses will not be materially greater than anticipated. These factors and assumptions should be considered carefully by readers. Readers are cautioned not to place undue reliance on the forward-looking statements or financial outlook or the assumptions on which the forward-looking statements and financial outlook are based on. Investors are further cautioned that the foregoing list of factors and assumptions is not exhaustive. In addition, information regarding targeted returns is based on the following principles and assumptions: the Partnership will maintain a consistent level of cash flow and indebtedness and will not materially incur additional indebtedness, other than with respect to ordinary operating costs or as disclosed herein; the consumer price index, property taxes, operating expense growth, and market rent growth will be as anticipated; existing tenants will fulfil their current contractual lease obligations and remain in occupancy and pay rent for the term of their leases; upon expiry of their leases, the number of retained tenants will meet historical retention experience; and the Partnership will maintain cash reserves as anticipated. Other assumptions: • •
Effective Gross Income Year to Year increase year one 4%, year two 17%, year three 5%, year four 3%, year five 3% Asset Value at time of sale is calculated using a 4.20% CAP rate.
Although we believe that the assumptions on which the forward-looking statements are made are reasonable, based on the information available to it on the date such statements were made, no assurances can be given as to whether these assumptions will prove to be correct. Accordingly, readers should not place undue reliance on forward-looking statements. We will not update any forward-looking information except as, and to the extent, required by applicable securities laws. The forward-looking statements contained herein, and all subsequent written and oral forward-looking statements attributable to the Partnership, or persons acting on any of their behalf, are expressly qualified in their entirety by this cautionary statement. Market data and certain industry statistics used throughout this executive summary were obtained from market research, informational and marketing materials provided to the CPI Capital, publicly available information and industry publications. Industry publications generally state that the information contained therein has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. No representation or warranty is made by the Partnership as to the accuracy or completeness of any of the information contained herein. No securities commission or similar regulatory authority has passes on the merits of the securities referred to hereunder and any representation to the contrary is an offence. In considering the prior performance information contained herein, prospective investors should bear in mind that past performance is not necessarily indicative of future results, and there can be no assurance that the Partnership will achieve comparable results.
Institutional Quality Investment
The following information is an investment summary provided to prospective investors and others. This information is not an offering to sell either a security or a solicitation to sell a security.Attherequestofareceipt,theCompany will provide a subscription agreement and Limited Partnership Agreement. The Managing Member in no way guarantees the projections contained herein. Real estate values, income, expenses and development costs are all affected by a multitude of forces outside the Managing Member’s control. This investment is illiquid and only those persons that are able and willing to risk their entire investment should participate. Please consult your attorney, CPA and/or professional financial advisor regarding the suitability of an investment by you.
Table of Contents Executive Summary Property Profile Financial Analysis Market Overview Portfolio & Case Studies Index
8 24 36 44
54 68
Executive Summary ✓ Investment Summary ✓ Investment Offering ✓ Investment Highlights
CPICapital.ca |
9
10 | CPICapital.ca
Investment Summary OFFERING SUMMARY
Charleston, South Carolina CPI Capital has identified Bluewater at Bolton’s Landing for acquisition. The asset is a 350-unit, 3-story garden apartment community located in the highly sought-after West Ashley submarket of the Charleston MSA. Completed in 2019, this true, Class A community was thoughtfully designed with stately architecture, quality floor plans and a serene landscape making it one of the premier communities in Charleston. Bluewater at Bolton’s Landing is situated in the heart of West Ashley which boasts stellar demographics and is in close proximity to major employers and medical jobs. The property also is minutes from the excitement of downtown Charleston and Folly Beach, James Island, Johns Island, and Kiawah Islands. This offering is a 45-106 - Prospectus Exemption and is open to only accredited investors. An accredited investor has either financial assets exceeding $1 million, OR net assets of least $5 million, OR an annual income of $200,000 (or $300,000 if married) for the last two years and you have a reasonable expectation that it will continue.
Cap (Adjusted T12*)
4.20%
Reversion Cap
See Page 15
Expense Ratio (Adjusted T12*)
37%
Occupancy (as of 7/7/21)
94%
DSCR
1.24
Purchase Price
$85,850,000
Hold Time
5 years
Equity Required (Total)
$27,884,024
Equity Required (LP-Class A)
$6,009,500
Equity Required (LP-Class B)
$21,874,524
Class A IRR and Avg. Annual Return
9%
Class B Return
See Page 15 *normalized based on real estate tax expense
CPICapital.ca |
11
Class A, New Construction, Coming Out Of Lease-Up, Poised For Takeoff Bluewater at Bolton’s Landing was developed as a true, ClassA community with the developer’s focus on quality floor plans and a site design complemented by a wooded, spacious neighborhood. Interior features include full-size washer & dryer sets in all units, direct access garages and screened porches in select units, private entryways and builtin intrusion alarms. The community also features a complete suite of exterior amenities driving resident appeal for the property and allowing the developer to close out their leaseup period with minimal upfront concessions.
Top Coastal Growth Market And #1 City in America The Charleston MSA has experienced an unprecedented 23% growth over the past decade, nearly 3x the national average. In addition, Charleston saw $186M of capital investment in 2020, a 184% increase from 2019, despite COVID19. The MSA had 6.7% total employment increase in the last 5 years alone, ranking in the top 20% of mid-size metros nationwide, and expected labor force increase of 2.7% by 2022. High-tech GDP growth has ranked the MSA in the top 7th percentile on Milken Institute’s 2020 list of Best- Performing Cities, evidence of its economy diversifying outside its manufacturing roots. Also, for 8 consecutive years, Charleston has consistently been voted the #1 City in America by Travel + Leisure.
12 | CPICapital.ca
Accessible To Key Metro Employers And Demand Drivers Bluewater is located in the quaint Bolton’s Landing neighborhood, proximate to a Publix grocer, as well as a brandnew, Harris Teeter- anchored retail center, and with 200K+ SF additional proposed retail in walking distance. The property is ideally located with an entrance off both Bees Ferry Road and Highway 17, providing residents with multiple commute options and convenient access to I-526 and I-26, as well as Charleston’s CBD. It is also proximate to the region’s largest employers, including both MUSC and Roper St. Francis medical campuses, Boeing, Bosch, and Joint Base Charleston, among others. Relative to more outlying suburbs (such as Summerville, Ladson, or Clements Ferry), Bluewater affords residents excellent access to key quality of life drivers including area beaches and downtown Charleston’s nationally recognized dining and nightlife.
Established & Growing Suburb Bluewater at Bolton’s Landing’s surrounding community of West Ashley is one of Charleston’s more affluent, reputable and desirable suburbs. The average household income within a 1-mile radius of the Property is $94,983, 4.4% higher than the MSA average. Home values in the adjoining neighborhood to Bluewater begin at $375,000 and the average sale price in the West Ashley area in 2021 has been $404,422, or 20.8% above the MSA average home value for 2020 These fundamentals have led to a massive renter pool with a market-leading 40% of the population opting to rent vs own, fueling a resurgence of major infrastructure improvements in the area.
CPICapital.ca |
13
Two-Tiered Equity Structure Allows Investors to Match Investment Goals Two-Tiered Return Structure: A twotiered return structure gives investors more choices when placing their equity. Investors have the opportunity to invest in either tier of equity Class A, Class B or a combination of both Class A and Class B. Diversifying in both classes allows for a risk adjusted and blended return. Limited Partner (A) Class A: Class A investors sit behind the debt in the capital stack. Class A has a preferred return of 9% paid out monthly This tier is limited to only 21.6% of the total equity with a minimum total investment of $25,000 per investor. Due to the position in the capital stack, Class A investors have virtually no upside upon disposition or another capital event. This tier is for investors who prefer stronger cashflow and minimal risk. Limited Partner (B) - Class B: Class B investors sit behind Class A investors in the capital stack, per the diagram. Class B has a preferred return of 7% which will accrue over the life of the deal. Cashflow from operations remaining after paying out Class A will be distributed to Class B investors monthly. The minimum investment in Class B is $25,000. This tier is for investors who want to maximize their returns over the life of the investment. Class B investors will participate in the upside upon disposition or capital events. 14 | CPICapital.ca
GENERAL PARTNER $27,884,024
LIMITED PARTNER (B)
30% Ownership 70% Ownership
LIMITED PARTNER (A)
DEBT
$69,186,000
INVESTOR BONUS*
Investments of $250,000 or more will receive an investor bonus. Class A: 1% bonus to reach a 10% annualized return when the asset is sold. Class B: 20% bonus on the backend equity when the asset is sold. *This bonus is paid by the GP equity and does not affect the returns for the other investors
C L A S S A P A R T N E RSH I P S T R U C T U R E Investor Distribution of Cashflow
9% Preferred to Investor
Membership Ownership
9% Preferred to Investor
C L A S S B P A R T N E RSH I P S T R U C T U R E Investor Distribution of Cashflow
7.0% Preferred to Investor 70/30 Split Thereafter
Membership Ownership
Balance to the Class B’s
Belo w ar e sample r etur n s based on each investme n t option : Class A provides an immediate and consistent return of 9% throughout the life of the investment.
I N V E S T O R R E T U R N S B A S E D O N $ 1 , 0 0 0 , 0 0 0 I N V E S T M E0 N T - C L A S SE A Investment Investor Annual Percent Return Investor Return on Investment
($1,000,000)
Return from Disposition - Limited Partner Total Return - Limited Partner
($1,000,000)
Year 1
Year 2
Year 3
Year 4
Year 5
9%
9%
9%
9%
109%
$90,000
$90,000
$90,000
$90,000
$90,000
$0
$0
$0
$0
$1,000,000
$90,000
$90,000
$90,000
$90,000
$1,090,000
Class B provides strong cash flows over the life of the investment and a higher overall return.
I N V E S T O R R E T U R N S B A S E D O N $ 1 , 0 000 , 0 0 0 I N V EES T M E N T - C L A S S B Investment Investor Annual Percent Return Investor Return on Investment
($1,000,000)
Return from Disposition - Limited Partner Total Return - Limited Partner
($1,000,000)
Year 1
Year 2
Year 3
Year 4
Year 5
4.6%
7.1%
7.6%
8.4%
8.6%
$46,008
$70,671
$75,959
$83,824
$86,210
$0
$0
$0
$0
$0
$46,008
$70,671
$75,959
$83,824
See Below
R E T U R NS U M M A R Y
Limited Partner (Class A)
Limited Partner (Class B) Sensitivity Range
Cap Rate
Return on Disposition
IRR
Equity Multiple
Avg. CoC*
Annualized**
N/A
$1,000,000
9.0%
1.45x
9.0%
9.0%
4.70%
$1,407,126
13.3%
1.77x
7.3%
15.4%
4.45%
$1,604,510
15.8%
1.97x
7.3%
19.3%
4.20%
$1,825,393
18.4%
2.19x
7.3%
23.8%
4.10%
$1,921,288
19.4%
2.28x
7.3%
25.7%
3.95%
$2,074,234
21.0%
2.44x
7.3%
28.7%
*Excludes proceeds from sale, **Includes proceeds from sale
CPICapital.ca |
15
Investment Offering CPI Capital is pleased to present this investment offering of the 350-unit, Bluewater at Bolton’s Landing community. Completed in 2019, Bluewater at Bolton’s Landing represents top-quality suburban living in a rapidly growing suburb of the Charleston MSA. The asset is a thoughtfully designed, low density community complete with spacious one-, two-, and three- bedroom apartments with convenient access to white-collar employment and major Charleston thoroughfares including MUSC and Roper St. Francis medical campuses, Boeing, Bosch and Joint Base Charleston.
16 | CPICapital.ca
B lu e w a t er at B olt on ’ s L an din g 1 68 0 B lu e w at e r W ay • Ch arle st on , S C 29 414
350
1,062
2018
371,683
Units
Average Unit Square Feet
Year Built
Rentable Square Feet
78.05
$1.41
$1,498
Acres
Average Market Rent/SF
Average Market Rent
94% Occupancy (As of 7/7/21)
CPICapital.ca |
17
Convenient Location With Neighborhood Lifestyle Appeal And Beach Proximity Attracts Discerning Renters Nestled in the quaint Bolton’s Landing neighborhood, Bluewater’s central location between downtown Charleston and 16 miles of beaches at Kiawah and Folly Islands attracts residents seeking proximity to both employment and lifestyle destinations. Additionally, its position at the confluence of Bees Ferry Rd, Highway 17, and Main Rd, with an ingress/egress point off each of the main arterials, also affords residents multiple commute options into downtown with alternate routes to avoid common traffic congestion.
T RA VE L T I M E T O KEY EMP LO Y ER S A N D LI FEST Y L E D EST I N A T I O N S West Ashley Greenway Access
5 minutes
Citadel Mall & MUSC Pavillion
15 minutes
Boeing 20 minutes
Stono Park & River Access
5 minutes
Leeds/Faber Place Business Parks
16 minutes
Joint Base Charleston 30 minutes
Bon Secours St Francis Hospital & West Ashley Medical District Avondale
18 | CPICapital.ca
10 minutes 12 minutes
Downtown Medical Campus 20 minutes (MUSC, Roper St. Francis, VA Hospital) Downtown Charleston 20 minutes
Kiawah Island 30 minutes Folly Beach 35 minutes
Bolton’s Landing Neighborhood
Kiawah Island West Ashley Greenway
Stono River
Avondale
CPICapital.ca |
19
Unprecedented Housing Market Fueling Renter Demand Real estate is prohibitively expensive in Charleston, and home prices in the area have been steadily rising since the market bottomed out in 2010. The recent market fluctuations, historically low interest rates, and an influx of new residents over the past year and a half have recently set the Charleston real estate landscape on fire, with the number of sales and listings also rising steadily. In May 2021, the average single-family sales price in Charleston County was $781,952, a 52% increase over 2020. Additionally, a huge decrease in inventory (74% down to only 531 listings) has increased competition, and the average time on the market was down 50% to only 22 days. Single family homes in West Ashley have followed a similar pattern, with the average sale price up 44.7% over last year to $439,248, inventory down 71%, and average time on the market at only 11 days (a 70% decrease from last year).
In West Ashley, real estate prices are up 51% since Jan 2020 with the average sale price as of May 2021 at $484,662, reflecting a 143% monthly payment increase to own vs. rent at Bluewater.
C H A RL ES T O N WA S N A T I O N ’ S FA ST EST G RO WI N G A P A RT MEN T MA RKE T I N 20 20 Despite this influx of supply and the impacts of COVID-19, Charleston has maintained strong occupancy with a current average of 94%, and 1.6% annual rent growth, in part due to a 23% population increase from 2010- 2020. Increased demand resulted in a staggering 250% increase in net absorption in Charleston in Q3 2020. According to CoStar, Charleston saw the largest percent increase in multifamily inventory in 2020 (6.6%), the highest growth rate among the country’s largest cities.
20 | CPICapital.ca
WEST ASHLEY COST COMPARISON: RENT VS BUY Avg. Home Sale Price in West Ashley*
$484,662
10% Down Payment
$48,466
Mortgage Amount
$436,196
Monthly Mortgage Payment (P&I) @ 2.78%
$1,787
Mortgage Insurance (PMI)
$182
Monthly Property Taxes & Insurance
$606
Total Monthly Payment
$2,575
Bluewater Average Market Rent
$1,498
Difference in Monthly Payment
$1,077
% Increase to Own vs. Rent
143%
*May 2021; Source: Charleston Trident Association of REALTORS®
The average home sales price in Charleston County has increased 58% since January 2020 to $781,952 as of May 2021
West Ashley Single-Family Homes (Avg. Price $484,662)
$2,200 - $2,600 Monthly Payment Bluewater at Bolton’s Landing $1,498 Avg. Market Rent
CPICapital.ca |
21
Cla ssi c Unit
Proven, Value Add Opportunity Built in 2018 and 2019, the current unit interiors are original which we will be updating to maximize rent premiums. These classic units are slightly less competitive with more modern assets in the submarket as renter preferences are maturing and evolving. Newer assets in the market are achieving rent premiums of $150-$200 greater than at Bluewater at Bolton’s Landing, providing upside for our ownership.
OUR PLANNED INTERIOR UPGRADES INCLUDE: • New, Stainless Steel Appliances
• Modern Lighting Package including Ceiling Fans • Updated Kitchen and Bath Plumbing Fixtures • Improved Paint Scheme • Premium Solid Surface Flooring in Common and Wet Areas as Needed
22 | CPICapital.ca
We are planning to spend $6,000 per unit on the interior upgrades of the classic units.
Moder n Lightin g Package
CP I Capital Ren o vated Un it
Impr ove d Pain t Schem e
Stainles s Steel Applia nce s
U pdate d K it chen Fixtur es
New Pr emiu m Floor ing
CPICapital.ca |
23
24 | CPICapital.ca
Property Profile ✓ ✓ ✓ ✓ ✓
Property Details Unit Mix Amenities Property Specifications Floor Plans
CPICapital.ca |
25
Bluewater at Bolton’s Landing Cha r l e s t o n , S C Bluewater at Bolton’s Landing is a 350 unit Class-A apartment community completed in 2019 situated on approximately 78 acres, offering 1, 2 and 3 bedroom units in 27 three-story buildings.
U ni t M i x ( A s o f J ul y 2021 )
CO M M U NI T Y A M ENI TI E S
U NI T F EA TU RE S
Pet-Friendly Community with Bark Park, Pet Stations and Grooming Center
Spacious Floor Plans with 9Foot Ceilings with Crown Molding & Abundant Windows
Outdoor Entertainment Lounge with Fireplace
High-Efficiency Heating & Cooling with Digital Thermostat
Ultramodern Fitness Center with Yoga Studio
Upscale Bathroom with Designer Fixtures & Ceramic Tiled Floors
Gorgeous Green Spaces with a Playground
Contemporary Kitchen Space with Granite Countertops & Energy Efficient Appliances
Bed/Bath
Avg SF
#Units
Rent/Unit
Rent/SF
1BR/1BA
730
14
$1,309
$1.79
1BR/1BA
810
15
$1,290
$1.59
1BR/1BA
817
26
$1,303
$1.59
Self Service Car Care Center
Full-Size High-Efficiency Washer & Dryer
1BR/1BA
817
4
$1,309
$1.60
Resident Mail Center
Bountiful Closet & Storage Spaces
1BR/1BA
846
8
$1,329
$1.57
Package Acceptance Service
1BR/1BA
858
28
$1,310
$1.53
Valet Trash Service
Patio/Balcony Access with Calming Views of Nearby Scenery
1BR/1BA
984
28
$1,503
$1.53
2BR/2BA
1,120
30
$1,546
$1.38
Free High-Speed Wireless Internet throughout Clubhouse
2BR/2BA
1,122
66
$1,536
$1.37
2BR/2BA
1,119
56
$1,483
$1.33
2BR/2BA
1,119
4
$1,484
$1.33
2BR/2BA
1,205
24
$1,751
$1.45
2BR/2BA
1,240
20
$1,627
$1.31
3BR/2BA
1,386
12
$1,731
$1.25
3BR/2BA
1,421
15
$1,744
$1.23
All 1 Beds
837
123
$1,336
$1.60
$1,571
$1.36
200
All 2 Beds
1,154
All 3 Beds
1,404
27
$1,738
$1.24
Totals
1,062
350
$1,498
$1.41
26 | CPICapital.ca
Resort-Style Pool including an Enormous Sundeck Fire Pit Lounge and Open-Air Dining Space with Gas Grilling Areas
Online Resident Services including Rent Payment and Service Requests Bicycle Storage and Additional Exterior Storage Options Smoke-Free Areas around the Community Attached and Detached Garages Available for Rent Breezeway and Garage Storage Units Available for Rent Scenic Nature Paths Internet Café at Resident Clubhouse Free Access to Conference Room
Luxury Plank Flooring, & Carpet in Bedrooms
Private Entryways & Intrusion Alarm System Equipment Gourmet Island Kitchens & Breakfast Bar* Direct Access Garages* Glass-Enclosed Walk-in Showers* *Available in select homes
8% 3 BEDROOM
35% 1 BEDROOM 57% 2 BEDROOM
CPICapital.ca |
27
Luxury Amenity Upgrade In addition to upgrading the interior of the units at Bluewater at Bolton’s Landing, we also plan to spend $750,000 on capital projects to improve and modernize the current amenities. These include: • Modernizing the fitness center with new equipment and paint • Pool and sundeck upgrades • Adding an additional dog park
• Expanding outdoor community spaces • Screening in all unit porches • Creating private yards as necessary or possible • Adding a dog wash station • New package room • Upgrading landscaping throughout the property
28 | CPICapital.ca
Pr o p e r t y S p e c i fic at io n s P R O P E R T Y D E TA I L S Year Built
2018/2019
Electrical
Each unit is individually metered
Building Style
Garden
Paving
Asphalt
Number of Buildings
27
Original Developer
Sterling Development, LLC
Number of Stories
3
UTI LITI ES
Acres
78.05 acres
Electric
Dominion
Site Density (Units/Acre)
4.48
Water/Sewer
Charleston Water System
Exterior Materials
Hardie board lap siding
Valet Trash
Valet living
Roof
Asphalt Shingle
Trash Removal
Federal International Waste Remedies
Roof Age
2018/2019
Gas
Dominion
Stairways
Exterior breezeways
PA R K I N G / GA R AG E S
Foundation
Concrete slab on grade
Surface Parking
352
Construction Type
Wood frame
Attached Garages
73 (30 are direct access)
Ceiling Height
9 foot
Detached Garages
24
Floor Coverings
Vinyl wood flooring in living and wet areas and carpet in bedrooms
Storage Units
105
CPICapital.ca |
29
30 | CPICapital.ca
Floor Plans CPICapital.ca |
31
One Be dr o o m
A2- 810 SF 1 BR - 1 BA Number of Units: 15
A3 - 817 SF 1 BR - 1 BA Number of Units: 30
A1 - 730 SF 1 BR - 1 BA Number of Units: 14
A4a - 846 SF 1 BR - 1 BA Number of Units: 8
32 | CPICapital.ca
A4b - 858 SF 1 BR - 1 BA Number of Units: 28
A5 - 984SF 1 BR - 1 BA Number of Units: 28
Tw o Be dr o o m B1 - 1,120 SF 2 BR - 2 BA Number of Units: 30
B2 - 1,122 SF 2 BR - 2 BA Number of Units: 66
B4 - 1,205 SF 2 BR - 2 BA Number of Units: 24
B4a - 1,240 SF 2 BR - 2 BA Number of Units: 20
B3 - 1,119 SF 2 BR - 2 BA Number of Units: 60
CPICapital.ca |
33
Thr e e Be d r o o m
C1 - 1,386 SF 3 BR - 2 BA Number of Units: 12
34 | CPICapital.ca
C2 - 1,421 SF 3 BR - 2 BA Number of Units: 15
CPICapital.ca |
35
L
!1 1 11
36 | CPICapital.ca
Financial Analysis ✓ ✓ ✓ ✓ ✓ ✓
Return on Investment Overview Debt and Cash Flows Pro Forma Projections Rent Comps Sale Comps Sensitivity Analysis
CPICapital.ca |
37
F i na nc i a l O v e r v ie w
OFFERING SUMMARY Cap (Adjusted T12*)
4.20%
Reversion Cap
See Page 15
Expense Ratio (Adjusted T12*)
37%
Occupancy (as of 7/7/21)
94%
DSCR
1.24
Purchase Price
$85,850,000
Hold Time
5 years
Equity Required (Total)
$27,884,024
Equity Required (LP-Class A)
$6,009,500
Equity Required (LP-Class B)
$21,874,524
Class A IRR and Avg. Annual Return
9%
Class B Return
See Page 15 *normalized based on real estate tax expense
38 | CPICapital.ca
DEBT FINANCING* Principal Balance
$69,186,00 0
Loan to Value
78 %
Loan Type
Private
Interest Rate
3.45 %
Months of Interest Only Payments
60
Term (Years)
3+1+ 1 Adjustable (We will be purchasing an interest rate cap to mitigate risk.)
Fixed or Adjustable Amortizing Period (Years)
30
Prepayment Penalty
0.5% exit fee
*Subject to change before closing
CPICapital.ca |
39
Pr o F o r ma Pr o je c t i o n s T-12
Per Unit
Year 1
Per Unit
Year 2
Year 3
Year 4
Year 5
$6,218,184
$17,766
$6,519,155
$18,626
$7,141,031
$7,443,286
$7,673,788
$7,904,290
Other Income
$705,511
$2,016
$739,653
$2,113
$808,769
$834,274
$850,619
$866,964
Loss to Lease
-$554,088
-$1,583
-$400,179
-$1,143
-$60,349
$0
$0
$0
Vacancy Loss
-$266,494
-$761
-$501,250
-$1,432
-$506,645
-$521,030
-$537,165
-$553,300
-$56,542
-$162
-$46,921
-$134
-$25,550
-$22,330
-$23,021
-$23,713
$0
$0
-$1,825
-$5
-$5,817
-$6,699
-$6,906
-$7,114
$6,046,572
$17,276
$6,308,632
$18,025
$7,351,440
$7,727,501
$7,957,314
$8,187,127
17%
5%
3%
3%
INCOME Gross Potential Rent
Concessions/Non-Rev Bad Debt EFFECTIVE GROSS INCOME YoY Increase
4%
OPERATING EXPENSES Payroll
$394,813
$1,128
$449,750
$1,285
$454,652
$463,829
$473,191
$482,742
Contract Services
$98,405
$281
$158,550
$453
$160,278
$163,513
$166,814
$170,181
Repairs & Maintenance
$106,249
$304
$70,000
$200
$70,763
$72,191
$73,648
$75,135
Turnover
$126,596
$362
$74,550
$213
$75,363
$76,884
$78,436
$80,019
Utilities
$241,144
$689
$304,500
$870
$307,819
$314,032
$320,371
$326,837
Administrative
$61,189
$175
$92,050
$263
$93,053
$94,932
$96,848
$98,802
Marketing
$99,255
$284
$70,000
$200
$70,763
$72,191
$73,648
$75,135
Insurance
$147,477
$421
$168,000
$480
$169,831
$173,259
$176,756
$180,324
$197,279
$564
$157,716
$451
$183,786
$193,188
$198,933
$204,678
Property Taxes
$891,252
$2,546
$1,111,843
$3,177
$1,123,962
$1,146,649
$1,169,793
$1,193,405
Replacement Reserves
$87,500
$250
$87,500
$250
$87,500
$87,500
$87,500
$87,500
$2,451,159
$7,003
$2,744,459
$7,841
$2,797,771
$2,858,168
$2,915,938
$2,974,758
38%
37%
37%
36%
$4,553,669
$4,869,334
$5,041,376
$5,212,369
28%
7%
4%
3%
Management Fee
2.5%
TOTAL OPERATING EXPENSES % of EGI NET OPERATING INCOME YoY Increase
40 | CPICapital.ca
41% $3,595,413
44% $10,273
$3,564,173 -1%
$10,183
Re nt Co m p s Building Name
Address
Units
Stories
Year Built
Avg SF
Mi. Away
Avg. Rent/SF
Avg. Rent/ Unit
1 Bed
2 Bed
3 Bed
Bluewater at Bolton's Landing
1680 Bluewater Way
350
3
2017
1,053
-
$1.41
$1,498
$1,336
$1,571
$1,738
17 South
105 Ivy Green Way
220
3
2017
930
1.02
$1.79
$1,669
$1,503
$1,933
-
The Heyward
3220 Hatchet Bay Dr
260
4
2017
991
0.40
$1.75
$1,736
$1,576
$1,896
$1,842
Bees Ferry Apartments
2020 Proximity Dr
292
3
2013
1,044
1.60
$1.65
$1,721
$1,472
$1,856
$1,937
Element Carolina Bay
1500 Parklawn Dr
276
3
2014
1,078
1.33
$1.60
$1,719
$1,533
$1,779
$1,831
Proximity Residences
2021 Proximity Dr
199
4
2017
1,070
1.49
$1.56
$1,671
$1,541
$1,786
$1,678
The Avenues at Verdier Pointe
3530 Verdier Blvd
288
3
2014
1,126
1.26
$1.50
$1,690
$1,456
$1,793
$1,899
Harper Place
3202 Coastal Grass Way
195
3
2020
1,085
1.51
$1.49
$1,618
$1,281
$1,821
$1,940
CPICapital.ca |
41
S a l e s Co m p s Criteria: Within 10 Miles of Bluewater at Bolton’s Landing and sold within the last 24 months. Sale Date
Property Name
Submarket
Number Of Units
Year Built
Sale Price
Price Per Unit
Pending
Bluewater at Bolton’s Landing
West Ashley
350
2018/2019
$85,850,000
$245,286
Pending/July 2021
Avalon at James Island
James Island
273
2020
$81,900,000
300,000+
May 2021
Caroline
Westside Charleston
237
2018
$76,750,000
$323,840
Nov 2020
Foundry Point
Upper Peninsula
276
2019
$82,393,240
$298,526
Oct 2019
Element 29
East Central
198
2020
$59,800,000
$302,020
Sep 2019
The Standard
James Island
280
2015
$68,850,000
$245,893
42 | CPICapital.ca
S e ns i t i v it y A nal ys i s Break Even Occupancy*
OCCUPANCY
GROSS INCOME
TOTAL EXPENSES
95%
$7,876,267
$5,248,805
85%
$7,132,039
$5,230,198
75%
$6,387,710
$5,211,590
65%
$5,643,381
$5,192,982
60%
$5,271,217
$5,183,678
55%
$4,899,053
$5,174,373
Cap Rate Analysis
CAP RATE
IRR
4.70%
13.3%
4.45%
15.8%
4.20%
18.4%
4.10%
19.4%
3.95%
21.0%
*Break Even Calculated After Stabilization
CPICapital.ca |
43
44 | CPICapital.ca
Market Overview ✓ ✓ ✓ ✓ ✓
Charleston By The Numbers Charleston’s Desirability Fuels Strong Market Fundamentals Tourist Destination To Economic Powerhouse Charleston’s Economy At A Glance West Ashley Growth And Development
CPICapital.ca |
45
Charleston By the Numbers
MSA Population - 2019:
819,705
Median Household Income:
$64,022
Population Growth: 2010-2020
23.3%
Charleston’s population exceeded 800,000 in 2019, 11 years earlier than predicted
Awards & Accolades #1 Best City in America for 8th Consecutive Year (Travel and Leisure, 2020) Top 10 Best Places to Live (Outside Magazine, 2020) #1 Small U.S. City (Conde Nast Traveler, 2019) #5 City Where the Jobs will Be (Forbes, 2020) The South’s Best City (Southern Living Magazine, 2020) #10 U.S. City Gaining Innovation Jobs (New York Times, 2020) #13 Best-Performing City in America (Milken Institute, 2020) #16 Best Place to Find a Job (WalletHub, 2020)
46 | CPICapital.ca
Charleston’s Desirability Fuels Strong Market Fundamentals Charleston’s historic charm, expanding job market, and temperate climate continue to attract new residents, and the area has experienced 23% population growth since 2010. It now has the #1 highest concentration of young professionals among all mid-size metros (500k-1M population). Across all industries, Charleston’s labor force increased by 25% between 2010 and 2018, according to the Charleston Regional Development Alliance, and Axiometrics projects another 3.1% annual job growth through 2024. As a result of this continued growth, the area economy is booming, and economic growth is projected to outpace the South regional average with 1.8% GDP growth over the next 5 years.
Re c e n t A nno unc e me nt s Evidence Of Cha r l e s to n’ s Bo o mi n g Ec o no m y A nd F ut ur e Gr o w t h • Google is investing $7 billion and creating 10,000 new jobs across the U.S. this year: the plans include $500 million for its Berkeley County data center • Walmart is investing $220M for the development of a 3M SF storage/cross dock facility that is expected to create over 1,000 new jobs • Cummins Turbo Technologies is expanding their turbocharger manufacturing operations in Charleston County: the $10 million investment will create 252 jobs • Vigilent Labs is building a new, $104M headquarters to produce rapid COVID-19 antibody and antigen test kits with operations beginning in December 2021, adding 400 new jobs • Bosch USA plans to invest $80 million in its Dorchester County facilities to meet the demand for electric powertrains for passenger and commercial vehicles; the twoyear expansion is expected to create hundreds of jobs • MUSC has proposed a new $130 million, 128bed hospital in Summerville to accommodate the rapidly growing population in the area
S C GD P GRO WT H CO M PA RI S ON 202 0 - 202 4 Aver age Annual Gr owt h %
Charleston Columbia Florence
Greenville South Carolina United States 0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
3.61%
94.5%
3.1%
Historical Annual Effective Rent Growth (CAGR)
5-Year Multifamily Average Physical Occupancy
Average Annual Job Growth Forecasted 20212024
CPICapital.ca |
47
Tourist Destination To Economic Powerhouse Cha r l e s t o n’ s Ec o no mi c S hi f t Ex pl ai n s The Ro bus t J o b Gr o w t h A nd A p a r t m e n t D e m a nd
Tourism & Leisure Economy:
1995-2008
6,420
1.11
$27,750
Average Annual Jobs
New Jobs per Housing Unit
Average Leisure Annual Wage
40% increase in job creation Diverse KnowledgeBased Economy:
2011-2018
8,790
1.58
$86,930
Average Annual Jobs
New Jobs per Housing Unit
Average Leisure Annual Wage
Tourism has historically been a major driver of Charleston’s economy, and had a staggering $9.7 billion economic impact in 2019. The sector is continuing to grow as the city makes press as one of the best in the country, and more direct flights to the Charleston International Airport are added. Ten airlines currently fly direct to Charleston from 30 cities. While tourism provides a continuous economic engine for Charleston, an influx of knowledge-based employment has transformed the area economy since Boeing opened its doors in 2009, followed by manufacturing giants Volvo Cars and Mercedes Benz Vans.
48 | CPICapital.ca
75+ 22,000
Aerospace Companies
Direct & Indirect Jobs From Boeing
1,600
Jobs added by Mercedes-Benz
1,600
Jobs added by Volvo for $1B SUV Plant
45
Average New Residents Per Day
Whi l e t o ur i sm s t i l l has an $ 9 B + e c o no mi c i mpac t i n Char l e s t o n , i t s e c o no m y no w de r i v e s s t r e ngt h fr o m d i v e r s i t y w i t h s t r o n g ae r o s pac e , adv anc e d manufac t ur i ng , a nd t e c hno l o g y s e c t o r s. • Volvo just announced a $118M investment to build Polestar 3 electric vehicles at its Charleston area facility, the move brings their total investment in South Carolina to $1.2B, and the number of vehicles produced in Charleston to 3.
• Mercedes-Benz announced plans last March to invest another $50M to build its electric Sprinter Van in Charleston starting in 2023; its continued expansion is fueling the growth of the automotive industry in the area
• The aerospace industry has grown in South Carolina more than 600% since 2009, resulting in more direct job creation than the automotive cluster did from 1990-2007 following the arrival of BMW.
• Boeing is consolidating production of its 787 Dreamliner to the North Charleston facility, moving all production of this model to SC from Washington State and solidifying their position in the Lowcountry
CPICapital.ca |
49
HEALTHCAR E MUSC • 700-bed hospital system which employs more than 27,500 people, has a $2.6B+ annual budget, with a total economic impact of nearly $4B • 3,000+ students are educated annually, including over 760 residents; 1,700 full-time faculty, and 300 part-time faculty • MUSC recently expanded into West Ashley in 2020 in the former Citadel Mall with a new, $33M, 126k SF hospital; the facility employs over 450 people and is located 6.8 miles from Bluewater • In Q1 2020, the $385M, 11-story, Shawn Jenkins Children’s Hospital located on the downtown peninsula delivered with 200 beds Roper St. Francis • Charleston’s only private, not-for-profit healthcare provider. The 657- bed system employs 6,000 and ranks in the top 15 systems in the country. Included in this system is the Bon Secours hospital in West Ashley, a 204- bed facility that employs 1,800
TOURIS M • $9.7B economic impact with over 7.4 million annual visitors • 47,000 people employed in tourism-related jobs • 3,111 hotel rooms have been delivered since 2018 • Charleston International Airport handled a record 4.8M passengers in 2019; passenger volumes forecasted to increase by 10-15% per year in 2021 and 2022
TECHNOLOGY & S OFTWARE • 250+ tech companies with more than 11,000 employees do business in Charleston • Benefitfocus relocated to Charleston in 2015 and now employs 1,250 people • Benefitfocus relocated to Charleston in 2015 and now employs 1,250 people • Blackbaud is headquartered in Charleston with 1,400 jobs on site
50 | CPICapital.ca
Bon Secours St. Francis (1 Mile from Bluewater) • 24-hour, 204-bed facility which employs over 1,800 • The campus recently completed construction of a senior center, accommodating the 25,000 senior citizens currently living in West Ashley Additionally, the campus began construction on its Center of Excellence for Obstetrics in late 2020 involving improvement of birthing suites. The improvements will increase patients’ rooms to twice their normal size and include spa-like bathrooms and amenities for family members
Preparing For Launch: West Ashley Infrastructure Improvements Setting The Stage For Future Growth West Ashley has benefited from Charleston’s explosive population growth with a 22% increase in residents since 2010. The area is poised to expand even further as development spreads across the MSA away from downtown. To accommodate this growth and resultant traffic, several infrastructure improvements are planned or underway which will make Bluewater resident commutes even easier.
M A I N RO A D CO RRI D O R PRO J EC T ( PI CTU RE D A T L EF T ) • Three-phase project to reduce congestion/ improve capacity at the intersection of US 17 and Main Road • Will increase capacity on Main Road and provide opportunities for bicyclists and pedestrians to travel throughout the project area • Provide drainage and other impacts of significant storms
improvements to
lessen
• Extend the West Ashley Greenway to Bees Ferry Road
WI D ENI N G O F GL EN N M CCO NNEL L PK W Y • Starting Q4 2021; will widen Glenn McConnell Pkwy to six lanes from Bees Ferry Rd to Magwood Dr
PLANNED I-526 EXTENSION WILL PROVIDEADDITIONA L ROUTE TO DOWNTOWN, ALLEVIATING HWY 17 CONGESTION • An extension of the I-526 Mark Clark Expressway is planned to improve connectivity in and around Charleston. The $725 million project would extend the arterial from Highway 17 in West Ashley through Johns Island to the James Island connector.
CPICapital.ca |
51
West Ashley Poised To Become The Center Of Growth With Major Development Project E PIC CENTE R Redevelopment of the Citadel Mall will be a catalyst for new jobs and future growth An ambitious development plan was approved last year to transform 1.3 million SF of the former Citadel Mall into approximately 4 million SF of mixed-use space, including offices, medical facilities, meeting spaces, restaurants and a world-class sport facility. The plan also allows for up to 1,225 housing units, with 184 of those units identified as affordable or attainable housing units. Redevelopment plans do not include the entire shopping center as Belk, Dillard’s and Target will remain in place. The transformation is already underway. MUSC took over the former J.C.Penney site with its new West Ashley Medical Pavilion in January of last year. Most recently, the Harbor Entrepreneur Center, moved forward with plans for a 6,200 SF workspace inside the former Express clothing store that is hoped to be a springboard for new tech jobs in the project.
52 | CPICapital.ca
11
CPICapital.ca |
53
Portfolio & Case Studies ✓ The CPI Capital Multifamily Portfolio ✓ Case Studies
54 | CPICapital.ca
The CPI Capital Multifamily Portfolio
PROPERTY
ACQUISITION DATE
MARKET
BUILT
Parc at Champion Forest
Houston, Texas
2000
22-Feb
$30,500,000
232
Braxton Waterleigh
Orlando, Florida
2021
21-July
$91,600,000
354
Richmond, BC
Under Construction
2017
$23,000,000
19
Richmond Town Homes
VALUATION
UNITS
*Indicates Sold Property, No Longer Under Management
CPICapital.ca |
55
CPI Capital Multifamily Portfolio
Braxton Waterleigh Property closed July 2021. Projected annual CoC returns of 9% (class a) and 7.1% (class b) and an IRR of 19.1% (class b) over a 5-year hold. PROPERTY DETAILS CL ASS
A
CONSTRUCTED
2021
L O C AT I O N
Orlando, FI
UNITS
354
PURCHASE PR ICE
$91.6MM
S TR U CT U R E
CO-GP
This asset is located in the rapidly growing Horizon West community of Winter Garden, which boasts stellar demographics and is home to notable white-collar employers and medical jobs. The Orlando MSA was one of the top investment markets prior to the COVID-19 pandemic and is rapidly making its way back to the top with strong job gains and overall population growth that ranked #3 in the country for 2020. Ascend Waterleigh is a thoughtfully designed, low density community complete with spacious one-, two-, and three-bedroom apartments with convenient access to white-collar employment and major Orlando thoroughfares.
56 | CPICapital.ca
CPI Capital Multifamily Portfolio
Parc at Champion Forest Property closed February 2022. Projected annual CoC 7% and an IRR of 16.7% (class a) and 17.7% (class b) over a 3-year hold. PROPERTY DETAILS CL ASS
B
CONSTRUCTED
2000
L O C AT I O N
Houston, TX
UNITS
232
PURCHASE PR ICE
$30.5m
S TR U CT U R E
CO-GP
The asset is a 232-unit, Class B multifamily value-add investment opportunity in fast-growing Northwest Houston, TX. Completed in 2000, this beautiful property was thoughtfully designed with stately architecture, quality floor plans and a serene landscape making it one of the most attractive communities in the area. Parc at Champion Forest is conveniently located along FM-1960 about halfway between I-45 and SH 249, 2 minutes from Walmart and Home Depot, and a short drive to major employers, including Amazon distribution centers HOU2 and HOU7, and Hospitals HCA Houston Healthcare Northwest and Houston Methodist at Willowbrook. CPICapital.ca |
57
CPI Capital Multifamily Portfolio
The Richmond Apartments Property closed in 2018. Projected is Currently under Development.
PROPERTY DETAILS CL ASS
A
CONSTRUCTED
2024
L O C AT I O N
Richmond, BC
UNITS
19
PURCHASE PR ICE
$8.7M
S TR U CT U R E
Structure Joint Venture
Ideally located in Richmond’s family-oriented area of No 4 Road and Steveston Highway. This project offers easy access to Vancouver, Delta and the US border. With a lot size of 41,169 square feet and sellable area of over 27,000 square feet, the average square feet per unit is 1400 per unit. This 19- unit townhome development features a large spacious family style living.
58 | CPICapital.ca
CPICapital.ca |
59
60 | CPICapital.ca
Index ✓ Property Management ✓ Real Estate Terms & Definitions ✓ Sponsorship / Management Team
CPICapital.ca |
61
Full Service Property Management Headquartered in Charlotte, NC
FCA Management manages over 4,500+ units in the Southeast in 5 states.
FCA Partners has 25+ years of management experience in the southeast.
FCA Partners provides quality daily management services that are focused on property operations, increasing asset value, timely and accurate reporting, and clear communication.
62 | CPICapital.ca
Real Estate Terms & Definitions ❖ Capitalization Rate (Cap Rate) – A rate of return on a real estate investment property based on the expected income that the property will generate. Capitalization rate is used to estimate the investor’s potential return on his or her investment. This is done by dividing the income the property will generate (after fixed costs and variable costs) by the total value of the property. ◊ When acquiring income property, the higher the capitalization rate (“Cap Rate”), the better. ◊ When selling income property, the lower the Cap Rate the better. ◊ A higher cap rate implies a lower price, a lower cap rate implies a higher price. ❖ Cash Flow – Cash generated from the operations of a company, generally defined as revenues less all operating expenses. ❖ Cash-on-Cash – A rate of return often used in real estate transactions. The calculation determines the cash income on the cash invested. ◊ Calculated: Annual Dollar Income Return / Total Equity Invested = Cash-on-Cash ❖ Debt Service Coverage Ratio (DSCR) – It is the multiples of cash flow available to meet annual interest and principal payments on debt. This ratio should ideally be over 1. That would mean the property is generating enough income to pay its debt obligations. ❖ Investor Average Annual Return, excluding disposition – The average return per year during the investment hold. This calculation does not include the return of invested capital. ❖ Investor Average Annual Return, including disposition – The average return per year including profits from disposition. ❖ Internal Rate of Return (IRR) – The rate of return that would make the present value of future cash flows plus the final market value of an investment opportunity equal the current market price of the investment or opportunity. The higher a project’s internal rate of return, the more desirable it is to undertake the project. ❖ Return on Equity (ROE) – The amount of net income returned as a percentage of shareholders equity. ◊ ROE is expressed as a percentage and calculated as: Return on Equity = Net Income/Shareholder’s Equity
CPICapital.ca |
63
Sponsorship / Management Team
AVA BENESOCKY
AUGUST BINIAZ
Chief Executive Officer
Chief Marketing Officer
DR. DRUV AMBATI Strategic Advisor
Featured in
64 | CPICapital.ca
DAN DRAGONETTI, MBA, BCOMM, BGNST, PMP Executive Director
ALAN WUNSCHE, MBA, CPA, CA, BSC, CBP EMD, Advisor
CPICapital.ca