The Gallery at Katy Apartments Investor Presentation

Gallery at Katy Apartments 1007 S Mason Road, Katy, TX 77450 Reg D 506(c) Investment Opportunity

ACCREDITED INVESTORS ONLY! http://katymffund.com/invest/ DEAL SPONSORS:

Michael Le, Viacheslav Davidenko, Merrill Kaliser, Julia Bykhovskaia

1

DISCLAIMER NOTICE This Business Plan contains privileged and confidential information and unauthorized use of this information in any manner is strictly prohibited. If you are not the intended recipient, please notify the sender immediately. Without prior permission from MDM AT KATY LLC, no person accepting this document shall release or reproduce (in whole or in part) this document, discuss any information contained herein, make representations or use such information for any purpose other than to evaluate the company’s business plans as provided herein. By accepting this document, the recipient agrees to keep confidential all information contained herein or made available in connection with any further investigation. Upon request, the recipient will promptly return to the company all materials received from the Sponsors and their representatives (including this document) without retaining copies thereof.

This Business Plan is for informational purposes and not intended to be a general solicitation or a securities offering of any kind. Prior to making any decision to contribute capital, all investors must review and execute all private offering documents.

Potential investors and other readers are cautioned that these forward looking statements are predictions only based on current information, assumptions and expectations that are inherently subject to risks and uncertainties that could cause future events or results to differ materially from those set forth or implied by such forward looking statements. These forward-looking statements can be identified by the use of forward-looking terminology, such as “may,” “will,” “seek,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” or “believe” or the negatives thereof or other variations thereon or comparable terminology. These forward-looking statements are only made as of the date of this Business Plan and Sponsors undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

The information contained herein is from sources believed to be reliable, however no representation by Sponsors, either expressed or implied, is made as to the accuracy of any information on this property and all investors should conduct their own research to determine the accuracy of any statements made. An investment in MDM AT KATY LLC will be a speculative investment and subject to significant risks and therefore investors are encouraged to consult with their personal legal and tax advisors. Neither the Sponsors, nor their representatives, officers, employees, affiliates, sub-contractor or vendors provide tax, legal or investment advice. Nothing in this document is intended to be or should be construed as such advice.

2

AGENDA

Property Overview Executive Summary Key Players Property Information Market Analysis Business Plan - Capital Expenditures Budget Financial Analysis - Loan Terms - Fee Disclosures Investment Opportunities Next Steps Q&A

4 5 6 14 18 25 28 29 32 41 42 47 51

3

PROPERTY OVERVIEW

1983

316

11

YEAR BUILT

UNITS

ACREAGE

255,166

807

28.73

NET RENTABLE AREA (SF)

AVG SF

DENSITY (UNITS/AC)

$997

$1.23

94%

EFFECTIVE RENT/ MONTH

AVG EFFECT/SF

OCCUPANCY 4

EXECUTIVE SUMMARY Business Plan

Offering Summary

•

•

•

•

The Property has averaged 93% occupancy through the pandemic ending until now

Purchase Price

$36,250,000

Estimated Equity Raise

$13,000,000

The Katy/Cinco Ranch/Waterside submarket had the highest absorption in Houston over the last 12-months ending Jun ‘20 with 1,950-units absorbed. This is 215% higher than the second highest submarket

Price Per Unit

$114,715

Current Asking Rent Per Unit

$997

Proforma Rent Per Unit

$1,083

With the strong absorption, the submarket also had the highest submarket occupancy growth in Houston with 9.9% and 7.1% occupancy growth in the last 3months and 6-months, respectively There is just one 240-unit multifamily property under construction within a 3-mile radius of the Property

•

Add granite/quartz countertops in kitchens and upgrade fireplace surrounds in all units, which would net approximately a $75 premium/unit/month

•

Add washers and dryers to 193-units (units without washers/dryers) for a $40 premium/unit/ month

•

Install private yards (select first floor units)

•

Bulk WI-FI Contract

•

Reserved Parking

Expected Investor Returns

10-12% Avg. Annual Cash Flow

80-90% 5-year Total Return

16-18%

14-16%

Avg. Annual Return

IRR

5

KEY PLAYERS

6

SPONSOR INTRODUCTIONS

MICHAEL LE

DAVID (VIACHESLAV) DAVIDENKO

Lead Sponsor

Lead Sponsor

Michael is a full-time accredited investor who lives in Houston. For many years he owned an IT consulting company with Fortune 500 customers in the Oil & Gas and Financial verticals. He has transacted on $35M in multifamily deals and has raised $13M in equity capital from investors.

Michael is developing a large 20 acre mixed-use complex that will have 30k sq ft in retail, 80k sq ft self-storage, and 300 unit Class-A multifamily apartment complex. Michael is also currently in the process of getting his CCIM (Certified Commercial Investment Member), a respected and globally recognized designation in the commercial real estate industry.

David is a full-time accredited investor from Austin. He is a respected, profit-driven entrepreneur and general management professional with a stellar career history of achievements investing in highly successful businesses. David is a Founder and ex- CEO of the Hi-Tech company, the silver prize winner of Forbes magazine's "The School of a Young Billionaire" competition. He has invested all-time as a GP and LP in 22 multifamily properties, almost 4,000 units altogether. David is a managing partner and co-founder of the Leander Springs, a mixed-use new development project with retail, restaurants, entertainment, hospitality, office and residential components with a four acre lagoon in the middle, that upon completion should be worth more than $1 billion.

Additionally, he also owns single-family investment properties.

He holds an MBA Degree from University of Chicago Graduate school of business.

7

SPONSOR INTRODUCTIONS

MERRILL KALISER

JULIA BYKHOVSKAIA

Lead Sponsor

Lead Sponsor

Merrill is the owner of a boutique commercial real estate and syndication law firm, as well as a Texas-based title company. His law firm has represented over 1,000 multifamily acquisitions valued over $4.2B. He has very extensive experience in acquiring, rehabbing, property managing and sell over 9,500 single-family rental homes throughout the mid-west U.S. He is also a co-GP on $1B development project in Leander, Texas. With respect to multifamily, Merrill is a Co-GP on 376 MF units and 110 storage units. Merrill lives in Frisco, TX with his wife Kim and their three children.

Julia Bykhovskaia, CFA, is a Co-Founder and Managing Partner of Sunsail Capital, a multifamily investment firm founded in 2017. Julia is an experienced investor who started her investment career in 2003 as a research analyst specializing in high yield/distressed and corporate bonds and worked at various hedge funds, including Schultze Asset Management, Concordia Advisors and Bulwark Bay. Julia was also a part of Workout/Debt Restructuring team at Credit Suisse and Loan Syndication & Trading Department at BNP Paribas in NYC. Julia is also a founder of CozyStays Suites, a corporate housing and short-term rental hospitality company. Julia earned a BS in Entrepreneurship from State University of Management in Moscow, Russia and an MBA in Finance from New York University’s Leonard N. Stern School of Business and is a Charted Financial Analyst. Julia is also a member of Forbes Real Estate Council.

8

SPONSOR INTRODUCTIONS

KAVITHA BARATAKKE

MATT PICHENY

Co-Sponsor

Co-Sponsor

Kavitha, a principal at Cherry Street Investments is an Austin-based Real Estate Investor and a full-time Commercial Real Estate Syndicator with over 10 years of investing experience in real estate. Prior to real estate, she spent almost 20 years as a Technology Professional working for IBM and Atlassian in various roles across Software Development, Customer Services, Partner Relations and Technical Account Management. Kavitha brings strong project management, problemsolving and presentation skills from her Technology background As an investor, Kavitha has successfully acquired, rehabbed, managed, owned and operated several single-family and multi-family investment properties in the Central Texas area. She sponsors commercial real estate investments in strong growth markets like Austin, DFW, San Antonio, Phoenix, and Atlanta with her partners. Over the last 10 years she has worked diligently on growing her real estate portfolio and retired herself from her technology job to pursue her passion in real-estate fulltime.

Matt is the Managing Partner at MJP Property Group, a real estate investment company. He has invested in over 5,000 apartment units and is primarily focused on acquiring and repositioning multifamily communities.

Matt has over 15 years of experience in property analysis, financing, acquisition, construction, and operations. He is a licensed real estate agent, a Fannie Mae & Freddie Mac approved buyer, and a member of the Forbes Real Estate Council. Matt has earned both Commercial Real Estate & Real Estate Finance certificates from Boston University.

As a PMI certified Project Management Professional, Matt has a proven track record of delivering projects on budget, on schedule and at the highest quality standards. He is a marketing veteran whose 20-year New York City career spanned several of the world’s largest advertising agencies.

Matt and his wife are Tony-nominated producers whose theatrical investments include Hamilton and an international tour of Wicked. They are currently co-Producers of the Broadway shows Moulin Rouge! and American Utopia.

9

SPONSOR INTRODUCTIONS

HOA HOA NGUYEN & NGUYEN JAIME GONZALEX Co-Sponsor Sponsor

Dr. Hoa Nguyen and Dr. Jaime Gonzalez are two very successful husband and wife therapeutic optometrists that own two multimillion dollar practices in the Dallas-Ft. Worth metroplex named Eye Pieces.

They have been two very accomplished entrepreneurs for ten years and currently have four associate therapeutic optometrists and twelve employees that work under their leadership. Dr. Nguyen and Dr. Gonzalez currently practice two days a week and also work full-time in real estate concentrating in the Texas, Arizona, Florida, and Georgia markets.

20/20 Investments is a team of real estate professionals that help busy professionals invest in conservative real estate multifamily assets in stable markets. We target multifamily assets that we consider value-add, conservative in risk, and that bring attractive returns to our investors.

RAMESH RAMESH NATCHIAPPAN NATCHIAPPAN Co-Sponsor Co-GP

Ramesh, Managing Principal of GK Capital in Avon, CT focuses on affordable, multifamily apartment buildings with upside growth potential.

Possesses an entrepreneurial mindset with focus on honesty and integrity. He has been investing in Real Estate since 2008. General Partner Portfolio consists of 1500+ units of >$125M value in Atlanta, Indiana, and Texas. He has completed full cycle - 2 projects as LP (2017 & 2019) and 3 projects as GP (2018).

Ramesh is in the process of creating the Passive Investors Millionaires Club. He holds MS Mathematics with strong financial background.

Formerly he was a Director - Risk, Governance and Compliance at The Hartford, CT

10

SPONSOR INTRODUCTIONS

RAJ TEKCHANDANI Co-Sponsor

Raj, founder and managing principal of Smart Capital, is a full-time real estate investment professional and has been investing in real estate since 2012. With background in business, tech and data analytics, he is able to leverage software tools to analyze markets and deals in order to maximize returns while minimizing risks for his investors.

Prior to founding Smart Capital, Raj was a successful product marketing and technology professional. He holds an MBA from the D’Amore-McKim School of Business at Northeastern University and Bachelors degree in Computer Science from Indian Institute of Technology. He is also on a board of Boston chapter of Pratham – a nonprofit devoted to providing education and helping under privileged kids in India.

11

ADVISORS

National Commercial Real Estate and SEC law firm

Cost Segregation Specialist: Utilized for all of our apartment transactions

CPA Firm: Large local CPA Firm with over 130 tax and accounting professionals

Debt Broker: W & D specializes in multifamily lending

General Contractor: Utilized for multiple apartment transactions

12

PROPERTY MANAGEMENT

13

PROPERTY INFORMATION

14

PROPERTY INFORMATION Year Built

1983

Purchase Price

$36,250,000

Acreage

22.00

CapEx Budget

$705,000

Number of Units

316

Price Per Unit

$114,715

Average Unit Size

807 sq.ft.

"All-In" Per Unit

$116,946

Average Rent/Sq.Ft.

$1.23

Current Rent Per Unit

$997

Occupancy

93%

After Rehab Rent Per Unit

$1,083

Asset Class

B+

T12 NOI

$1,840,410

Exterior

Brick Veneer & Siding

T3 NOI

$1,776,232

Roof

Pitched Shingle

Going-In Cap Rate

4.90%

HVAC

Individual

Reversion Cap Rate

5.25%

Hot Water

Individual

Electricity

Tenant Pays

Water/Sewer

RUBS

Gas

Owner Pays

Trash

Valet

15

EXTERIOR RENOVATIONS

POOL DECK REPAIRS | NEW POOL FURNITURE

MULTI-PURPOSE SPORT COURT

NEW ROOFS

16

INTERIOR RENOVATIONS

STAINLESS STEEL APPLIANCES | NEW CABINET DOORS

FLOORING

CLUBHOUSE RENOVATION

RESURFACED COUNTERTOPS | TILE BACKSPLASH

FITNESS CENTER RENOVATIONS

LIGHTING UPGRADE | 2” BLINDS

17

MARKET ANALYSIS

18

INVESTMENT HIGHLIGHTS EXTENSIVE CAPEX COMPLETED BY CURRENT OWNER

ZONED TO ACCLAIMED KATY ISD

• The current owner spent $3.25 million in 2016 on interior and exterior renovations

• The Property is zoned to Taylor High School and Memorial Parkway Junior High School, which both rank 8 (GreatSchools, 2020). Taylor High School ranks in the top 94 percentile amongst all Texas high schools (SchoolDigger, 2019) • Katy ISD has a total of 72 campuses covering 181 square miles (includes Harris County, Fort Bend County, and Waller County) with a staff of more than 10,000+

INTERIOR

• • • • • • • • •

New Cabinet Doors Resurfaced Countertops Stainless Steel Appliances Updated Lighting New Plumbing Fixtures 2” Blinds Flooring Tile Backsplash Framed Bathroom Mirrors

EXTERIOR

• • • • • • •

Landscaping Pool Deck Repairs New Gates Fitness Center Renovations All-new roofs Clubhouse Renovation New Pool Furniture

• The student body is over 84,000+ and poised to grow 2,000 - 3,000 each year • Katy ISD averages approximately 5 and 143 points higher on ACT and SAT scores than the state average, respectively • Katy ISD was recently awarded the highest possible rating given by the Texas Education Agency

• Additional $200,000 spent in 2019/2020 on re-painting and residing the property with vinyl, new landscaping, replacing exterior lighting, resurfacing the tennis court into a sport court, replacing the stairway railings, and retooling the fitness center

STRONG SURROUNDING DEMOGRAPHICS • $95,437 household income in a 1-mile radius and is projected to grow 13.3% over the next 5-years • 36% of households average $100,000 or greater household income in a 1-mile radius • 70% white collar employment in a 1-mile radius 19

AREA MAP

20

HEALTHCARE EMPLOYERS

1

1 | METHODIST WEST HOUSTON HOSPITAL • Located on 84 acres with over 2,100 employees •

478,500 SF including 193 beds, 15 operating rooms, and 316,000 SF of medical office pace

•

The $170 million Phase 2 expansion began April 2016 that includes 228,000 SF, 95 additional beds, 22 emergency rooms, an expanded maternity unit, expanded medical imaging services, and a six-story garage2

2

2 | THE TEXAS CHILDREN’S HOSPITAL - WEST CAMPUS • 55-acre campus is the first community hospital designed, built, and equipped exclusively for children • Contains 515,007 square feet and over 1,000 employees •

Underwent a $50 million expansion in 2017 that included a helipad, 42 bed acute care expansion, four new operating rooms, and additional critical care beds

3

3 | MEMORIAL HERMANN KATY HOSPITAL • •

210 bed facility on 66 acres with 1,100 employees Underwent an $85 million 329,000 SF expansion that brought the hospital from 142 to 210 beds

•

The first four floors of the new patient tower are operational with the top two floor shelled space for future growth that would bring the count up to 300 beds

4 | M.D. ANDERSON CANCER CENTER • $113.75 million outpatient diagnostic and treatment center opened in 2019 •

4

The 260,000 SF facility is the first phase of a long-term plan on its 34.5-acre campus located at Interstate 10 and Highway 6 in the Central Park development

21

AREA RETAIL

4

9

6

KATY GRAND SQUARE 250,000 SF GLA - 18 stores Cinemark 19 Theaters, JCPenney, Red Robin, Sonic, Dockers, Slim Chickens, Whiskey Cake Kitchen, La Madeleine, Church’s

HIGHLAND KNOLLS DR

GRAND CROSSING 500,000 SF GLA - 19 stores Costco Wholesale, Becks Prime, Carus Dental, Mattress Firm, T-Mobile, Mo’s Irish Pub, Sleep Number, Texas Furniture Hut

PARK PLAZA Charming Charlie, Verizon, Tapas Grill, Aki Sushi, My Gym, Crossfit, A-Gleam Swim and Sport, Stars Sportsbar, Thatbar

CINCO RANCH BLVD

7 8

LA CENTERRA AT CINCO RANCH 368,524 SF GLA - 75 stores Chicos, Pure Barre, Zoes Kitchen, Eddie Bauer, Torchy’s Tacos, World of Beer, Loft, PDQ, Francesca’s, Dish Society, Claires 97,761 SF GLA - 20 stores Super Target, Homegoods, Michaels, CVS, Office Max, Spec’s, Mattress Firm, Sally Beauty, Massage Envy

9

KINGSLAND BLVD

406,888 SF GLA - 33 stores Dicks, DSW, Field & Stream, Mattress Firm, Golf Galaxy, PetsMart, Bed Bath & Beyond, Kirklands, Chipotle, Outback

CINCO RANCH AT MARKET CENTER

10

10

ER

8

4 5

M

7

THE SHOPPES AT PARK WEST

1

2

EI TH ES Y W KW P

6

3

KATY RANCH CROSSING 410,000 SF GLA Main Event, Chicago Pizza, Tuesday Morning, Guitar Center, Katy Emergency Center, Planet Fitness, Floor & Decor

PARK ROW

K EE SP RD

5

COLONIAL PKWY

WESTGREEN BLVD

3

1,638,472 SF GLA - 175 stores - 3,000 employees H&M, Off Fifth, Bass Pro Shops, AMC Theaters, Kate Spade, Gap, American Eagle, Coach, Old Navy, Burlington, Marshalls

MASON RD

2

KATY MILLS MALL

KATY FORT BEND RD

1

FRANZ RD

KATY MILLS MALL

LA CENTERRA

PRICE PLAZA 695,036 SF GLA Home Depot, Best Buy, Sam’s Club, JoAnn Fabrics

10

GARDENS AT WESTGREEN 54,413 SF GLA Orleans Seafood Kitchen, Texas Borders Bar & Grill, Wild Wing Cafe, Brewski’s Pub

22

AERIAL VIEW NORTHEAST The Gardens at Westgreen Steak -n- Shake | Texas Road House

Walmart | Sam’s Club | The Home Depot Best Buy | HEB| Kohl’s | LAFitness The Home Decor Superstore

Slick Willie’s | Brewski’s | Orleans Seafood Kitchen Academy Sports Morton Ranch High School &Outdoors Corporate British International BMWof WestHouston Headquarters Autonation School FordKaty GEICO CarMax

10 Fiesta Mart | Dollar Tree Fitness Connection Taco Cabana | Chick Fila Whataburger | Taquerias Arandas

Toyota of Katy Honda of Katy Katy Medical Complex

Texas Medical CenterWest Taylor High School

Mann EyeInstitute

Kingsland Park &Ride

Energy Corridor

Greentree Shopping Center Target | Lowe’s | Petsmart Randall’s | Party City | Wendy’s IHOP | Ulta Beauty | GNC

Texas Children’s Pediatrics Kingsland Katy Kips Gymnastics Club Public Storage Memorial Parkway ElementarySchool

M as on Rd

GA LLE RY AT KA TY | 23

23

AERIAL VIEW NORTHWEST AERIAL VIEW | NORTHWEST | KATY

KatyBoardwalk Mixed-useDevelopment

Dick’s Sporting Goods | Golf Galaxy Petsmart | BuyBuy Baby DSWShoe Warehouse Bed Bath &Beyond Chipotle | Abuelo’s Mexican OutbackSteakhouse

Katy Mills Mall Walmart

Main Event | Dollar Tree Altitude TrampolinePark Woodlands Elite Cheer Floor &Decor | PlanetFitness Taco Cabana | IHOP Spec’s Wines,Spirits &Finer Foods GuitarCenter

99Cent Store Headquarters Bargain Wholesale Southwest Foods Distributing Memorial Hermann La Madeleine Cinemark 19 Katy Hospital Slim Chickens Red Robin

Costco

West Memorial ElementarySchool King

slan

Katy Budget Books Tuesday Morning Pho Saigon | Ray’sMexican

Maso

d Blv d

JCPenney

West Memorial Junior HighSchool

University of Houston New Katy Campus 10

Mason Center Katy Kips Gymnastics Club Shopping Mall Big Lots | Jack in the Box Dairy Queen

n Rd

Public Storage

Pa

rk

Tr

ee

Ln

GA LLE RY AT KA TY | 24

Memorial Parkway ElementarySchool 24

BUSINESS PLAN

25

INCOME GENERATING INCOME GENERATING VALUEVALUE-ADDS ADDS

Technology Package - Gigafy $151,200 generated per year $151,200 over per year Implemented 2 years Implemented over 2 years

Reserved Parking $30,000 generated per year $30,000 per Implemented overyear 2 years Implemented over 3 years

Carports

Washer-Dryer

$18,000 generated per year $92,640 generated per year $18,000 per year $60,000 per year Implemented over 2 years Implemented over 2 years Implemented over 3 years

Implemented over 5 years

Additional value created at a at 5.25% cap cap raterate is almost $5,000,000 Additional value created a 5.25% is $5,550,000 (atthe thetime timeof ofthe theproperty propertysale) sale) (at

5 26

VALUE-ADD UPGRADES Interior •Luxury Upgrade – 50 Units ○ Granite countertops in kitchens ○ Upgrade fireplace surrounds ○ Patio Enclosure

27

CAPITAL EXPENDITURES BUDGET

Item

Units

Cost Per Unit

Interior Upgrades - Luxury Upgrade

50

$3,500

$175,000

Washer/Dryer

193

$1,000

$193,000

Gigafy WiFi

316

$500

$158,000

Water Conservation Carport Total

Total

$134,000 30

$1,500

$45,000 $705,000

28

FINANCIAL ANALYSIS

29

RENTAL INCOME DURING COVID PANDEMIC Monthly Net Rental Income 350,000 300,000

278,688

281,912

279,487

276,112

271,642

271,399

March

April

May

June

July

August

282,495

250,000 200,000 150,000 100,000 50,000 0 September

30

RENT COMPARABLES

31

LOAN TERMS Loan Amount

$26,000,000

Interest Rate

3.0%

Interest-Only Period

60 months

Loan Term

120 months

Lender

Walker & Dunlop

Agency

Freddie Mac

Pre-Payment

1% after 12 mos

Exit Strategy: 10 year loan term with only 1% prepay allows flexibility on timing of exit • Option 1: Refinance on Year 3 for a return of investment projected at 60% • Option 2: Sell after 5 Year Hold when total returns is achieved.

• Option 3: Hold for length of loan term 32

FINANCIAL ANALYSIS – PROJECTED RETURNS Class B Projected Returns

$100k Investment

Total Investor Returns

85.41%

Average Annual Cash Flow

11.55%

Total Investor IRR

15.20%

Investment Term

5 years

Investment Amount

Annual Return

Profit on Sale

Cash Flow Year1

Year 2

Year3

Year 4

Year5

5.84%

14.42%

11.81%

12.98%

12.70%

Amount Invested

$100,00

$100,000

$93,333

$93,333

$93,333

Cash Flow

$5,840

$7,750 + $6,667 (escrow return)

$11,025

$12,110

$11,851

Total Projected Profit

Total Cash Returned including Investment

85.41%

$36,835

$85,411

$185,411

33

FINANCIAL ANALYSIS – Five Year Cash Flow Model

0% Income Growth from T3 -2% Lower Income than T12

Return of Lender Escrow

Exit Cap rate is 0.35% higher than going in T3 cap

34

FINANCIAL ANALYSIS – Stress Test Stress Test: Sponsors have stress tested the numbers on the deal to determine cash flow in worst-case scenarios.

This is to confirm that the deal will preserve our investors' capital.

Scenario Parameters: 1. As-Is/No Growth

-

Determine If the Current Operations Alone Can Cover the Debt Service

2. Rent Shock

-

Rent Drops 5% and Then Stays Low

3. Vacancy Shock

-

Maximum Economic Vacancy that Can Cover Debt Service

Item

Assumption

Debt Service Coverage Ratio (DSCR)

Remarks

As-Is Operation

No rent increase

Range from 1.35 to 2.13

No rent increase but expense increase of 2% annually. Deal still cash flows.

Rent Shock

2 Years 5.0% revenue decrease

Range from 1.35 to 1.89

Rent drop causes total income to drop 2 consecutive years. Deal still cash flows.

Vacancy Shock

40%+ Economic vacancy Yr 1-5

1.0 for All 5 Years

Even at 42-43% economic vacancy. Property breaks even.

35

FINANCIAL ANALYSIS – Zero Rent Growth Stress Test 0% Rent and Other Income Growth Expenses Still Growing at 2%

Income Stays the Same Throughout Entire 5 Years

Property Still Cash Flows

36

FINANCIAL ANALYSIS – 2-Years Rent Drop Stress Test 0% Rent and Other Income Growth Expenses Still Growing at 2%

Income Drops 5% First 2 Years Stays the Same The Other 3 Years

Property Still Cash Flows

37

FINANCIAL ANALYSIS – Economic Vacancy Stress Test

Max Economic Vacancy to Still Make Debt Service Payments

Break-even Debt Service Coverage Ratio

38

FINANCIAL ANALYSIS – Cap Rate Sensitivity Underwriting: 5.50% Exit Cap Rate after Year 5 Annual Cash Flow: 10-12%

Total Returns: 65-75%

TARGET - Underwriting: 5.25% Exit Cap Rate after Year 5 Annual Cash Flow: 10-12%

Total Returns: 80-90%

Underwriting: 5.00% Exit Cap Rate after Year 5 Annual Cash Flow: 10-12%

Total Returns: 90-100%

39

FINANCIAL ANALYSIS – COST SEGREGATION

Based on initial cost segregation study, Engineer Tax Services has determined that investors should be able to benefit from bonus depreciation between 70-90% of invested amount. *Should you garner more depreciation deductions than you need to effectively reduce your income to $0.00, any remaining unused depreciation may be carried forward for up to 20 years and used to defray future income.

The surplus depreciation is not lost!

* Disclaimer:

Please do not consider this as tax advice. Please contact your CPA for your individual tax situation.

40

FINANCIAL ANALYSIS – FEE DISCLOSURE Item

Amount

Comment

Asset Management Fee

2.0%

Percent of total revenue paid monthly to asset manager

Acquisition Fee

1.0%

Percent of purchase price

Sponsor Compensation

30%

Distributed cash flow after equity investor preferences

0%

Equity Investors

Net sales proceeds prior to 100% of initial capital returned to equity investors

30%

Net sales proceeds after 100% of initial capital returned to equity investors

70%

Distributed cash flow (subject to relevant preferences)

100% 70%

Net sales proceeds until 100% of initial capital returned to equity investors Net sales proceeds after 100% of initial capital returned to equity investors (subject to Class)

41

INVESTMENT OPPORTUNITIES

42

FINANCIAL ANALYSIS – CLASS A MEMBERS

Investment Highlights

• Minimum Investment - $ 75,000

Expected Investor Returns

10.00% Avg. Annual Cash Flow

50.00% 5-year Total Return

• 10% Preference • Accelerated Bonus Depreciation • Preferred Treatment

Underwriting

$36.25M

$705K

Purchase Price

Total Rehab

~$13M Equity Raise

10.00%

10.00%

5-year IRR

Avg. Annual Return

1.50x Equity Multiple

None Investor/Sponsor Split

MINIMUM INVESTMENT

$ 75,000 43

FINANCIAL ANALYSIS – CLASS B MEMBERS

Investment Highlights

• Minimum Investment - $400,000

Expected Investor Returns

11.55% Avg. Annual Cash Flow

85.41% 5-year Total Return

• 9% Preference • Accelerated Bonus Depreciation

Underwriting

$36.25M

$705K

Purchase Price

Total Rehab

~$13M Equity Raise

15.20%

17.08%

5-year IRR

Avg. Annual Return

1.85x Equity Multiple

70%/30% Investor/Sponsor Split

MINIMUM INVESTMENT

$400,000 44

FINANCIAL ANALYSIS – CLASS C MEMBERS

Investment Highlights

• Minimum Investment - $100,000

Expected Investor Returns

10.82% Avg. Annual Cash Flow

82.01% 5-year Total Return

• 8% Preference • Accelerated Bonus Depreciation

Underwriting

$36.25M

$705K

Purchase Price

Total Rehab

~$13M Equity Raise

14.68%

16.40%

5-year IRR

Avg. Annual Return

1.82x Equity Multiple

70%/30% Investor/Sponsor Split

MINIMUM INVESTMENT

$100,000 45

FINANCIAL ANALYSIS – CLASS D MEMBERS

Investment Highlights

• Minimum Investment - $ 75,000

Expected Investor Returns

10.09% Avg. Annual Cash Flow

78.61% 5-year Total Return

• 7% Preference • Accelerated Bonus Depreciation

Underwriting

$36.25M

$705K

Purchase Price

Total Rehab

~$13M Equity Raise

14.13%

15.72%

5-year IRR

Avg. Annual Return

1.79x Equity Multiple

70%/30% Investor/Sponsor Split

MINIMUM INVESTMENT

$ 75,000 46

NEXT STEPS

47

NEXT STEPS - SUBSCRIPTION PROCESS ●

Begin the subscription process by going here (we will also email the link).

There you will fill in your basic information, your investment type (Individual, Joint, Entity/Corporate, or SD-IRA), your desired investor Class, and your investment amount.

●

You will then receive the Subscription Booklet via DocuSign for signature by all the relevant parties.

●

Upon receipt of the completed Subscription Booklet, our team will reach out to you to begin the Accreditation process.

There are 3 ways to prove your Accredited status 1.

2.

3.

Affidavit signed by your CPA, Attorney, Investment Advisor registered with the SEC, or a registered broker-dealer (blank affidavit will be provided) Perform accreditation with Verify Investor, a 3rd party law firm that will review your financial statements to verify your status (our team has no visibility whatsoever to any documentation you provide; we only receive the results of the review). Cost of this service will be paid by our team.

Provide an Affidavit or Verify Investor Accreditation Certificate obtained in the previous 90 days

●

Upon your Accreditation, our team will review all documents then reach out to you with wiring instructions.

●

Positions reserved for highest capital investments and those who subscribe first

●

Note: The general partner signing the legal documents will be Michael Le 48

NEXT STEPS - PROJECTED TIMELINE

11/04/20

11/18/20

12/17/20

Contract Date

Investor Webinar / Subscription Period Opens

Target Completion of Equity Raise

12/29/20 Target Closing Date

49

NEXT STEPS - CONTACT US: investors@katymffund.com MICHAEL LE

VIACHESLAV (DAVID) DAVIDENKO

Lead Sponsor

MERRILL KALISER

Lead Sponsor

Lead Sponsor

Email: david@davidinvest.com

Email: mkaliser@kaliserlaw.com

Phone: 515-999-6616

Phone: 972-567-6099

JULIA BYKHOVSKAIA

KAVITHA V. BARATAKKE

MATT PICHENY

Lead Sponsor

Co-Sponsor

Co-Sponsor

Email: julia@sunsailcapital.com

Email: cherrystinvestments@gmail.com

Email: matt@mjppg.com

Phone: 646-281-8460

Phone: 512-659-6129

HOA NGUYEN

RAMESH NATCHIAPPAN

RAJ TEKCHANDANI

Co-Sponsor

Co-Sponsor

Co-Sponsor

Email: hoa@eyepiecesinvesting.com

Email: ramesh_nat@hotmail.com

Email: raj@smartcapitalmgmt.com

Phone: 713-502-8428

Phone: 860-922-1189

Phone: 978-761-9937

Email: michael@bayoucitymultifamily.com Phone: 713-568-6550

Phone: 646-522-1369

50

Q&A

51

NEXT STEPS – INVEST @ https://bit.ly/InvestInKaty MICHAEL LE

VIACHESLAV (DAVID) DAVIDENKO

Lead Sponsor

Lead Sponsor

Email: michael@bayoucitymultifamily.com

Email: david@davidinvest.com

Phone: 713-568-6550

Phone: 515-999-6616

JULIA BYKHOVSKAIA Lead Sponsor Email: julia@sunsailcapital.com Phone: 646-281-8460

MERRILL KALISER

HOA NGUYEN

Lead Sponsor

Co-Sponsor

Email: mkaliser@kaliserlaw.com

Email: hoa@eyepiecesinvesting.com

Phone: 972-567-6099

Phone: 713-502-8428

52