Douglas Wilson Companies Spring 2015 Newsletter

Las Vegas

Spring 2015 Newsletter

San Diego San Francisco Washington, D.C.

DWC READIES FOR DROUGHT’S IMPACT ON REAL ESTATE SPECIALIZED SERVICES Development Services Land Entitlements Asset/Property Management Asset Repositioning Resort/Hotel Management Golf Course Management Receiverships Trustee Brokerage & Disposition Referee Forensic Accounting Due Diligence Court-Appointed Fiduciary Special Master Liquidating Trustee Bankruptcy Examiner Expert Testimony Highest and Best Use Analysis

From ski resorts to agricultural properties, Douglas Wilson Companies (DWC) realizes and understands the challenges some real estate and operating business sectors are facing as a result of the ongoing water shortage in the Western United States, and California in particular.

A decline in natural snowfall changes the nature of ski resort operations, while California Drought Effects Ski Resorts long-standing agricultural properties are challenged to produce under diminishing natural conditions and restrictions on water inputs. Although state and local governments are working to address climate change, the frequency of extreme events such as droughts, heat waves, wildfires, and floods is expected to increase, according to an early 2015 report by the Public Policy Institute of California (PPIC), negatively impacting agricultural properties. Conversely, higher temperatures will result in more precipitation falling as rain in mountainous regions — and less as snow — PPIC reports. Many will be forced to adopt new operations, or change course entirely.

DWC has more than a decade of experience working with ski resorts and agricultural operations, both as receiver and consultant. We have worked with numerous clients to develop successful outcomes across the nation.

-CONTINUED INSIDE

ADVISORY SERVICES GROWTH UNDERWAY AT DWC DWC continues to grow in its full-service real estate platform, spanning development, brokerage and development management services. With more than 25 years of experience, DWC is known nationwide for its ability to provide a full range of professional real estate services to meet our clients’ needs.

Currently working with family trusts, hotel REITs, community focused non-profit organizations, corporate clients expanding their campuses, and individual land owners, DWC’s team of professionals is fully versed and experienced in all areas of development including strategic planning, lease negotiations, development planning, financing, and project management — from design through completion.

DWC has been focused on leveraging our long-standing relationships with various municipalities and public agencies to facilitate expedited and seamless entitlement successes. Our capabilities include land acquisition, zoning evaluation, asset value assessments, project entitlement, financing procurement and construction management — providing a full soup-to-nuts suite of services for clients of all types.

Problem Resolution & Fiduciary Services | Real Estate & Construction Services | Brokerage Services

Spring 2015 Newsletter DWC READIES FOR DROUGHT’S IMPACT ON REAL ESTATE (CON’T) “In realizing the opportunity senior living presents, we are dedicated to committing the resources necessary to mark our foray into this sector with our established capabilities & expertise.”

- Douglas Wilson

Our agricultural experience spans more than 10,000 acres of active farms and ranches. As Receiver for Morimoto Almond Farms — a series of 12 working almond farms in Northern California — DWC negotiated with and retained third-party farm management to care for, preserve and maintain the farms while completing rezoning of 372 acres to Industrial Planned Development use. DWC later liquidated the farming operations and sold the land at above appraised value. The firm has also successfully managed ranch operations for Citrus Farms’ six producing properties in Central California; consulted for Dillingham Ranch, a 2,500-acre cattle ranch with equestrian center, coconut tree plantation, local water district and 10room inn in Oahu, Hawaii; and managed the Loyal M. Nordstrom Estate, with numerous properties across California, Washington, and Hawaii, including a 2,500-acre horse, llama and alpaca farm.

Morimoto Almond Farms

Over the last 10 years, DWC has also handled numerous, diverse ski resort properties in receivership with continued experience and success. The firm’s expert receivership team has managed several such assignments including Tamarack Resort in the greater Boise, Idaho area; Shanty Creek Resort & Club 30 miles from Traverse City, Michigan; and Royal Gorge Ski Resort & Rainbow Lodge near Lake Tahoe, California.

DWC has developed unique solutions during these assignments. In the case of Tamarack Resort (Resort), the firm was met with several challenges after being engaged to take over and stabilize the resort. Located 90 miles north of Boise, Idaho, Tamarack Resort is a 7,000 acre four-season resort and residential community — the first newly permitted four-season resort in North America in more than two decades.

DWC’s initial receivership task included the in-depth review of all departmental operations (lodging, food & beverage, recreational activities, and construction) for purposes of preparing a 90 Day Budget to prepare the Resort for the winter ski season. DWC supervised all Resort personnel while overseeing the Resort’s winter operations. Additionally, DWC supervised the construction/winterization of the Resort’s Village Plaza and residential developments while adhering to all environmental, regulatory, and governmental agencies. Other tasks included implementing a winter marketing plan, the transfer and operations of numerous liquor licenses, the verification of all escrow monies, and the review of all pending legal matters.

DWC’s ski resort work has spanned in-depth financial and membership plan analysis, forbearance and foreclosure, operations, management of staff, and the marketing and sale of such properties.

As the drought continues, ski resorts and agricultural properties will be impacted and DWC is here to provide our expertise on this foreseen condition and challenges in hopes of achieving the best possible outcomes.

DWC MAKES ENTRY INTO SENIOR LIVING WITH NEW PLATFORM DWC is making a strategic foray into the business of senior living development. As part of our ongoing commitment to development across the southwest region and beyond, the firm will be embarking on a new product line of senior living with an assisted living and memory care focus.

The firm’s pursuit of upcoming senior living projects stems from our realization of a strategic opportunity based upon growing demographics and investor demand. It is often cited that 10,000 baby boomers turn 65 each day, and in the coming decades, DWC is committed to developing residences that will house and help care for this growing population. To date, the firm has partnered with several industry consultants and has engaged with strategic partners to grow its presence in this market sector. We are in the process of undergoing several feasibility studies with a memory care and assisted living focus, toward the development of market rate units managed by an experienced operator in the senior living space.

“We are very attentive to the uptick in this market,” said DWC Chairman and CEO Douglas Wilson. “In realizing the opportunity senior living presents, we are dedicated to committing the resources necessary to mark our foray into this sector with our established capabilities and expertise.” DWC is focused on developing and holding senior living assets as long term investments. With the firm’s recent hires and new talent, this new product line is a natural segue for DWC.

DWC BRINGS 460-ACRE PREMIER SAN DIEGO AGRICULTURAL PROPERTY TO MARKET DWC is brokering for sale a 460-acre premiere agricultural property in Oceanside, California.

The property, Singh Ranch, is an operating tomato farm suitable for a wealth of future development potential, including new residential construction. The property is owned by the Singh family, a third-generation farmer, which is known for its production of vine-ripe tomatoes that are distributed both locally and throughout the U.S. The family will consider a leaseback of the property while future development entitlements are obtained.

Las Vegas

330 E Warm Springs Road Suite B43 Las Vegas, NV 89119

San Diego

1620 Fifth Avenue Suite 400 San Diego, CA 92101

San Francisco

50 California Street Suite 1500 San Francisco, CA 94111

Washington, D.C. 1200 G Street NW Suite 800 Washington, DC 20005

Current zoning provides for 2.5-acre minimum lot size, presenting a prime opportunity for future equestrian or agricultural estates located just nine miles inland from the Pacific Ocean.

Residential development is an obvious future use of the property as it is located to allow for gated entries from adjacent thoroughfares and is connected to existing trails that extend to Oceanside’s waterfront and beaches.

The property is a prime development opportunity featuring gentle, rolling hills, pristine views and excellent soil and climate for growing. Singh Ranch also features an elaborate multi-well water distribution system that includes eight on-site wells (and approvals for three additional wells) and a 1.5-million gallon reservoir that is suited, and currently in use with an existing irrigation system for agricultural purposes.

For More Information: Michele Vives Managing Director mvives@douglaswilson.com 619.906.4376

INSIDE California Drought Impact DWC Advisory Services Senior Living Platform New Brokerage Assignment

N ewsletter Our current primary focus is on principal real estate transactions in market niches that are attractive to the current capital markets. Of particular interest is our dedication to growing a portfolio of senior living facilities as the market will continue to expand with the aging population and undersupply of product.

Douglas Wilson

Chairman & CEO dwilson@douglaswilson.com

Regarding the state of the workout business,

I want to again thank all of our deep relationships for the continued support over the past many years!!

Sincerely,

Douglas P. Wilson

1620 Fifth Avenue, Suite 400 San Diego, California 92101

As evidenced by the variety of projects referenced in this edition of our newsletter, DWC continues to diversify, reflecting the evolution of the improving economy.

although the stabilized markets have led to a significant reduction in troubled real estate assets, we are beginning to see more partnership disputes involving fraud. As has been the case in the past, this trend closely follows the past few economic cycles and is why we will never abandon our 26 years of experience in this arena.

www.douglaswilson.com 619.641.1141

Dear Friends,