CashFlow Life Newsletter - August 2023

Life C SHFLOW

As the summer sun shines brightly upon us, we are thrilled to announce the exciting developments in our student housing portfolio here at Kahuna Investments. With the turn season fast approaching, we are turning up the Arizona heat to elevate the living experience for our cherished student residents.

At Kahuna, we understand that the turn season presents a unique opportunity to make a lasting impact on our residents' lives. As we gear up for these transformations, our dedicated team is hard at work, meticulously planning and executing upgrades that will set a new standard in student housing excellence.

Our student housing properties are more than just buildings; they are vibrant communities that nurture personal growth, academic success, and lifelong connections. As we embark on these turns, our vision is clear: to create living spaces that inspire and empower young minds.

As investors, your unwavering support has been the driving force behind our progress. Your partnership fuels our passion for innovation and excellence. We are deeply grateful for the trust you place in us and are excited to share the fruits of our collective e orts.

Transparency and open communication have always been the cornerstones of our relationship with our investors. roughout the turn season, we will keep you closely informed about the progress made in each of our student housing properties. Your con dence in our endeavors is paramount, and we want you to witness rsthand the positive impact of your investments.

At Kahuna, we are not just building properties; we are shaping the lives and futures of tomorrow's leaders. Our commitment extends beyond real estate—it is about creating homes that foster personal growth, academic success, and a strong sense of community.

ank you for being an integral part of our journey. Your belief in our mission empowers us to push the boundaries of excellence and rede ne student housing. Here's to turning up the heat and creating a brighter future for all.

Your Paradise is Possible,

Dishing it with Shelley

COREY PETERSON

CEO/ FOUNDER KAHUNA INVESTMENTS

Investments, Corey strives to provide his investors with stable cash ow returns and long-term capital appreciation by buying multi-family apartments. Corey has managed and acquired over $200+ million in real estate across the country. He is the bestselling author of "Why e Rich Get Richer - e Secrets to Cash-Flowing Apartments" and host of the Multi-Family Legacy Podcast. He speaks around the country on this subject including at Harvard and Nasdaq. Corey is frequently featured on FOX, CBS, ABC, and NBC a liates.

EDITOR IN CHIEF

ALICIA MAXWELL

We are thrilled to introduce you to the newest member of the Kahuna family, Alicia Maxwell! With great pleasure, we welcome Alicia as our Investor Relations Specialist.

As our Investor Relations Specialist, Alicia will be your dedicated point of contact, ensuring that your needs are met, questions are answered, and feedback is heard. Her commitment to building meaningful connections aligns perfectly with the values we hold dear at Kahuna Investments.

We are con dent that Alicia’s passion for fostering positive relationships will further enhance the exceptional experiences we strive to provide to each and every one of our valued investors.

Please join us in giving Alicia a warm welcome to the Kahuna team! We look forward to witnessing the positive impact of her expertise on our investor community.

IN THIS EDITION

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Student Housing Rent Growth

Market Watch with Gannon

Property Management During Summer

Dishing It with Shelley

August Word Hunt: Summer Escapade

PURPOSE-BUILT STUDENT HOUSING RENT GROWTH OUTPERFORMS CONVENTIONAL SECTOR

rent changes compared to conventional housing. In contrast, conventional housing has faced deeper cuts during negative rent change months, particularly during the 11-month stretch from May 2020 to March 2021. Student competitive housing was particularly impacted during the 2020 downturn, with a slightly longer and more signi cant period of negative rent growth.

Over the past decade, student housing rent growth has consistently lagged behind conventional multifamily housing. However, there has been a notable change in recent months. Purpose-built student housing has started to grow at a faster rate than the conventional sector, a rst during a non-contractionary period.

Student housing has been considered a stable sector, supported by historical data. Over the last 120 months, annual rent change has been negative for only six months, compared to 12 months for conventional multifamily housing. Nonetheless, this stability has come with limited upside growth in the student housing space.

Looking ahead, student housing rent growth is expected to slow down, although robust student demand and reduced supply indicate positive momentum for the Fall 2024 outlook.

Notably, in recent months, purpose-built student housing has consistently outperformed conventional housing in terms of annual rent growth for seven consecutive months, starting from November 2022. During this period, the sector averaged an annual rent change of 8.8%, compared to 4.5% for conventional housing. Student competitive housing appears to be following a similar trajectory to the conventional space.

When comparing the 10-year average e ective asking rent change, conventional multifamily housing signi cantly outperforms student housing, primarily due to higher year-over-year rent growth during growth years. Student competitive housing, which refers to conventional market-rate housing within three miles of a campus boundary, follows similar growth trends but underperforms the larger conventional sector.

During economic downturns, purpose-built student housing remains resilient, experiencing minimal negative

One intriguing aspect of this comparison is the student competitive subset. In 2020 and early 2021, this asset type was impacted by the introduction of remote learning, leading to reduced student-driven demand and a ecting non-student demand on nearby campuses. More recently, student competitive housing seems to be aligning with the broader conventional universe, as expected.

Overall, while the national gure for student housing rent change tends to blur local di erences, some campuses have achieved double-digit rent growth, while only four campuses experienced year-over-year rent cuts in May 2023.

INVESTOR SPOTLIGHT

David embarked on a mission for the Church of Jesus Christ of Latter-day Saints in the Dominican Republic, honing his Spanish-speaking skills. Later, while attending BYU, he formed close friendships with the girls in an adjacent apartment, including Patti.

Years passed, and fate brought them back together in the Seattle area. ey fell in love, married, and soon became parents to three sons and a daughter. Recently, they joyfully welcomed their rst granddaughter into their lives.

DAVID AND PATTI ROYSTER

Congratulations to investors of the month, David and Patti Royster! David grew up in Porterville, California, nestled between Fresno and Bakers eld—a farming community where his dad worked in a family land leveling business and his mom managed an orange packing house. With a family dynamic of "his, hers, ours, and somebody else's,"

David worked in corporate America until a layo in 2013 prompted a change. With plans already in place to quit the following year, he received a severance that allowed him to venture into real estate with his brother-in-law, Chris Kemp. Flipping homes and acquiring rental properties became their focus. As members of a real estate investors association, they discovered Kahuna Investments, where they found the allure of greater returns and an opportunity to passively invest in multi-family properties while gaining knowledge for future active investments.

e couple attended an exceptional multi-family training o ered by Kahuna Investments, expanding their skills and network. rough this experience, they met David Rosenbaum, leading them to their rst multi-family investment—a remarkable endeavor that doubled in value within two years, delivering excellent returns to all investors. As they continue to enhance the property's NOI, they hold onto it with pride.

Not letting opportunities pass, David and Patti also invested in a laundromat during the pandemic, generating substantial cash ow. Amidst their achievements, David's great joy lies in playing racquetball, a priority he

maintains with Tuesday and ursday games at 2 pm.

Hailing from Porterville to becoming savvy real estate investors, David and Patti Royster exemplify the power of perseverance, strategic decisions, and a shared vision for nancial growth. eir journey stands as an inspiring testament to how determination and unity can pave the way to success. Way to go David and Patti! You both are living the life of Sunsets and Palmtrees!

EMBRACING AI: THE FUTURE OF COMMERCIAL REAL ESTATE SIMPLIFIED

In the rapidly evolving commercial real estate sector, there has been a reluctance to adopt new technologies. However, at Kahuna Investments, we know the importance of nurturing relationships and integrating technology that continues to add value over time. Arti cial intelligence (AI) is a notable tool that can signi cantly enhance operations, increase productivity, and reduce costs. Contrary to concerns about job loss, we see AI as a powerful instrument to enhance productivity, cut costs, and boost the e ciency of deal-making. By strategically leveraging AI insights and analytics, professionals can make better-informed decisions and identify pro table opportunities previously missed. Furthermore, AI can streamline processes, optimize property management, and improve tenant experiences, making it a win-win for everyone. Our belief is that adopting AI in commercial real estate is about securing long-term success and staying relevant. As frontrunners in this transformation, we are committed to showcasing how AI can boost the growth and prosperity of the commercial real estate sector.

In 2023 and 2024, AI can enhance your real estate business in numerous ways such as:

1. Raising Private Capital:

- AI can help identify potential investors and engage them via chatbots, generating personalized content to increase engagement and conversions.

. Asset Management:

- AI can process data to o er insights, predict property appreciation, risks, and automate routine tasks like rent collection and maintenance.

- AI can identify undervalued properties, extract key information from documents, and o er immersive virtual property tours for remote assessments.

Property Management:

- AI can optimize energy usage, automate maintenance requests, and assist tenants with routine tasks, enhancing overall experience and satisfaction.

e areas where AI can have the most impact now are predictive analytics, investor pro ling, and marketing automation. Leveraging AI in these areas can enable more informed investment decisions, attract suitable investors, and manage properties more e ciently. As AI continues to evolve, staying updated on its developments is vital for the future of commercial real estate. At Kahuna Investments, we see embracing AI as essential for the future of commercial real estate. By harnessing AI's potential, we can unlock opportunities, fuel growth, and remain at the forefront of the industry. We are excited to navigate this transformation and build a prosperous future together.

PROPERTY MANAGEMENT DURING SUMMER

FIND YOUR Cool BY THE Pool

At Kahuna Investments, we take great pride in our proactive approach to handling our properties and tenants during the summer months. As the temperature rises, we go above and beyond to ensure that our properties remain well-maintained, comfortable, and enjoyable for our valued residents.

Preventive Maintenance: Before summer arrives, we conduct thorough inspections of our properties to identify any potential maintenance needs. From checking cooling systems and HVAC units to ensuring proper insulation, we address any issues promptly to avoid disruptions during the peak of the summer season. Our preventive maintenance approach helps maintain the comfort of our tenants and extends the lifespan of our property assets.

Energy E ciency and Sustainability: At Kahuna Investments, we are committed to sustainability and energy e ciency. During the summer, we implement various energy-saving measures, such as using programmable thermostats, installing energy-e cient lighting, and optimizing insulation. ese initiatives not only reduce utility costs for our tenants but also contribute to a greener and more environmentally responsible community.

Tenant Communication and Support: Clear and open communication is at the core of our tenant relations. As

- summer approaches, we proactively inform our residents about any upcoming maintenance activities, community events, or seasonal tips to stay cool and conserve energy. Our responsive property management team is always available to address any tenant concerns promptly, ensuring a seamless and positive living experience.

Outdoor Spaces and Amenities: We believe in creating vibrant and inviting outdoor spaces for our tenants to enjoy during the summer. Our landscaping team works diligently to maintain lush greenery, manicured lawns, and beautifully landscaped common areas. Additionally, our well-maintained amenities, such as swimming pools and outdoor recreation spaces, o er residents the perfect escape to beat the summer heat and foster a sense of community.

Safety and Security: Our commitment to tenant safety is unwavering. During the summer, we take extra precautions to ensure that our properties meet safety standards. From regular inspections of pool facilities to reinforcing security measures, we strive to provide a secure and worry-free environment for our residents.

Emergency Response: Accidents and emergencies can happen at any time. Our property management team is on-call 24/7 to respond promptly to any urgent situation. Whether it's a maintenance issue or a safety concern, our residents can rest assured knowing that they have a reliable team ready to assist them whenever needed.

As the sun shines bright during summer, our dedication to providing exceptional property management shines even brighter. At Kahuna Investments, we prioritize the comfort, safety, and well-being of our tenants, ensuring that they have a delightful and stress-free summer experience. From preventive maintenance to energy e ciency initiatives and outstanding tenant support, we strive to make summer at Kahuna

Carolina Creek | Greenville, NC

DISHING IT WITH SHELLEY

Cucumber, Tomato, and Avocado Salad is the perfect summer meal, o ering a refreshing and nutritious combination of fresh vegetables. Packed with vitamins and minerals, this salad provides a light and hydrating option for hot days. e crispness of cucumbers, juiciness of tomatoes, and creaminess of avocados create a delightful harmony of avors. It's a simple yet satisfying dish that embodies the essence of summer and promotes a healthy lifestyle.

CUCUMBER, TOMATO, AND AVOCADO SALAD

Ingredients for 4 servings

• 1 english cucumber, diced

• 4 roma tomatoes, diced

• 3 ripe avocados, diced

• ½ red onion, diced

• ¼ cup fresh cilantro(10 g), chopped

• 1 lemon, juiced

• salt, to taste

• pepper, to taste

• 2 tablespoons extra virgin olive oil

Source: Tasty.co

Preparation

• Slice then dice cucumber.

• Slice then dice tomatoes.

• Slice avocado and carefully remove stone. Scoop out inside and dice.

• Peel onion and remove tops. en slice.

• Chop cilantro and place in a large salad bowl with previous ingredients.

• Toss with olive oil, lemon juice, salt and pepper. Serve in a bowl.

• Enjoy!

PLAY & WIN