DEVELOP RIVERTOWN. RIVERTOWN Acres of Detroit Waterfront Development Opportunity

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1 DEVELOP RIVERTOWN RIVERTOWN Acres of Detroit Waterfront Development Opportunity

2 DEVELOP RIVERTOWN

3 We are pleased to extend to you these Detroit development opportunities.

4 EXECUTIVE SUMMARY Detroit is experiencing an inflow of corporate headquarters, tech start-ups, millennials and global investment. While corporate offices are relocating to downtown Detroit to attract and retain top-talent, Detroit s genuine gritty culture is also drawing young, entrepreneurial talent, resulting in the single fastest growing tech hub in the state of Michigan. Annual employment has topped 30,000 positions for eight consecutive quarters, resulting in the lowest unemployment since 2001 and a stabilized population on the verge of growth for the first time in a half century. Simultaneously, the City has right-sized its operations through the course of the bankruptcy proceedings, resulting in more streamlined civic planning and management. As a Detroit bond insurer, Syncora Guarantee acquired the development rights to Rivertown land through the bankruptcy settlement. Witnessing the beginning of the Detroit recovery first hand, Syncora pursued the development rights for two large land holdings in the Rivertown district, Chene at 8.9 acres and Atwater at 2.75 acres, as part of its settlement package with the City. Today, Syncora is looking to partner with a developer(s) to lead the development of the Rivertown options. The Chene option is made of 2 adjacent lots and has potential for more than 1.8 million square feet of development, spanning from the riverfront views of Atwater street to the primary traffic artery of Jefferson Avenue. The Atwater option is a 2.75 acre lot, representing over 400,000 square feet of development, a 6-minute walk to the GM Renaissance center and has riverfront views along Atwater and is adjacent to Milliken State Park. Chene and Atwater are a 10 and 20 minute walk to downtown, respectively, and ideal for developments that need a quieter berg with quick access to downtown Detroit. Lead by S.O.M of NYC, the Rivertown parcels are the subject of a district wide planning effort that is calling for increased density, a comprehensive park and public transit strategy and run/bike paths, phase-1 work is scheduled for Rivertown development incentives are being coordinated with the planning effort as the City encourages higher density development along the river. Additionally, given the potential density of the sites, around 2.2 million square feet of mixed product, the City is willing to commit special project teams to support developer needs and ensure a successful development. If your team is interested in further considering this development project, please contact Tom Waters at (517) or Mary Jane Constant at Maryjane. constant@scafg.com. We are looking for a developer and investment partner(s) to work on these projects by March 31st.

5 TABLE OF CONTENTS WHY DETROIT RIVERFRONT SYNCORA THE DETROIT MARKET COMPANIES RELOCATING DOWNTOWN DEVELOPMENT ACTIVITY DETROIT BEFORE & TODAY THE RIVERTOWN OPPORTUNITIES CHENE 9 Acres ATWATER 2.75 Acres PROJECT SUPPORT COMPANY AND CONTACTS DEVELOPMENT PARTNER NEXT STEPS

6 WHY DETROIT RIVERFRONT? Just east of the Renaissance Center, that houses GM s headquarters and other businesses, the Detroit riverfront, known locally as Rivertown, is under going a district-wide redevelopment. The once heavily industrial area is the target for redevelopment into a world-class riverfront community, with the City providing master planning and both political and economic support. Like many urban waterfronts across the country, Rivertown s history is heavily industrial, supplying Detroit s material and shipping needs through the last 150 years. The bars and restaurants that serviced the Rivertown workers provided a rich cultural fabric. Over the past 25 years Detroit has turned its attention toward keeping that culture, while relocating industry and replacing it with community. Initially the Rivertown district was the anticipated site of Detroit s casinos, but with casinos choosing different sites around Detroit rather than a single district, Rivertown is being planned as a high-density mix of old and new buildings that pay homage to Detroit s storied and blue collar history. With the major industrial operations relocated and the former facilities razed, the Detroit Riverfront Conservancy started the transformation with the Detroit Riverwalk, making the waterfront a public resource. Next, the Downtown Detroit Partnership converted the below-grade railway, formerly used to transport local industrial supply, into a below-grade green-way known as the Dequindre cut. The Dequindre cut, connects Rivertown to the Riverwalk and other Detroit districts for runners, walkers and bikers. Further east of Rivertown and connected by Riverwalk is Belle Isle, the former playground of both Detroit public and elites. The island, which boasted a zoo, conservancy, yacht club, golf course, beach, casino and nature reserve, had been left to ruin during the 90 s and into the recession. Through the course of the bankruptcy, Detroit returned the operation and control of Belle Isle to the State of Michigan. The Belle Isle restoration is well on its way to returning the island to former glory and becoming again a resource and destination for Detroiters. (Cont d)

7 WHY DETROIT RIVERFRONT? (CONT D) To begin repopulating Rivertown as a diverse, mixed-use community, Detroit partnered with developer Richard Baron to break ground on Orleans Landing, a 267-unit multi-acre mixed use development, set to open in April of While Orleans Landing proved the demand for waterfront living, Detroit hired S.O.M. of NYC to develop a district plan to help guide the dense, urban community that Detroiters envision. S.O.M., in collaboration with City officials, district property holders, developers, the Detroit Riverfront Conservancy and the larger Detroit community, have developed a master plan to standardize zoning/incentives, public transportation and a large district park strategy, all to guide the redevelopment of the Rivertown area. The district plan is expected to be made public in Q1 of As a result of corporate headquarters, offices and millennials moving downtown, for the first time since the 1950 s, the population has stabilized and is on the cusp of growth. With 16-year record low multi-family vacancies of 2-3%, the community needs places to live and work as the downtown community expands. Rivertown represents a unique opportunity as so many market forces converge simultaneously. Detroit s long population decline slowed to its lowest pace in decades last year and some experts say next year s numbers could show the first signs of growth since the 1950s. I m very confident that the city of Detroit is growing now and that will be reflected in the next report...we re at a historic tipping point. Freep.com Duggan sees positive in Detroit population loss

8 SYNCORA & THE DETROIT BANKRUPTCY Syncoras primary business is bond insurance. It was through insuring City debt and the recent Detroit bankruptcy that they ultimately acquired the development rights to Detroit riverfront land. Witnessing the beginning of Detroit s recovery first hand, Syncora pursued land as part of its settlement package. The option rights to the Rivertown land are in the form of a Development Agreement with the City of Detroit, which can be provided as part of the due diligence package. To help create and realize the value from the riverfront opportunity, Syncora is looking to partner with a developer to lead the redevelopment of the Rivertown options. Syncora, who is not a developer, is looking for a partner to create and execute a robust development plan for these rare urban-riverfront opportunities. Syncora is looking for a well qualified development partner to develop the Rivertown area and ensure a successful Detroit recovery. In addition to the Rivertown land, Syncora has additional operations throughout Detroit, which include operating the Detroit-Windsor tunnel through wholly-owned subsidiary American Roads as well as development options for other city assets. Through those operations the Syncora team has established relationships throughout the City and community and can provide introductions and support where needed or desired. RIVERTOWN SITES ATWATER SIZE 2.75 Acres TYPE Contiguous land LOCATION(S) 1303 E Atwater 1365 E Atwater 1364 Franklin 1340 Franklin 1310 Franklin 1399 E Atwater 1325 E Atwater 1370 Guoin St CHENE SIZE 8.9 Acres TYPE 2 Adjacent Lots LOCATION(S) 2310 E. Jefferson 2290 E. Jefferson 301 Chene 281 Chene 2263 E. Atwater

9 SYNCORA & THE DETROIT BANKRUPTCY THE DEVELOPMENT AGREEMENT The bankruptcy settlement was finalized in December of The settlement package included a Development Agreement, which provides development rights to 3 distinct Detroit properties including the 2 Rivertown properties, Chene and Atwater, as well as the former Detroit Police Head Quarters building. The Development Agreements (D.A.) intended purpose is to encourage the redevelopment of the Rivertown area and ensure a quick and successful Detroit recovery. To encourage development, the D.A. represents a no-cost option with time restrictions and option expiration. The D.A. requires that upon taking title to each subject property, construction must start within 15-months and be completed within 39-months from the date of exercising the respective options. Each sites expiration corresponds to the respective size of development, with the Atwater option expiring December of 2018 and the Chene option expiring in December of With timing as the primary restriction, the Development Agreement does not intend to limit or restrict the development as it relates to zoning, development/product type or economic incentives. The Development Agreement assigns rights to Pike Pointe Holdings, a subsidiary of Syncora Guarantee.

10 THE DETROIT MARKET ECONOMIC SUMMARY Vacancy in the Detroit metro has fallen to the tightest rate in Income per Year $70,000 $60,000 $50,000 $40,000 $30,000 MEDIAN INCOME (HH) Detroit National Vacancy Rates 8% 6% 4% 2% 0% MULTIFAMILY VACANCY RATES US Average Detroit Metro years... A significant portion of the demand for rentals comes from job creation. Annualized employment growth has topped POPULATION & UNEMPLOYMENT 1 MM 20% 12% CAP RATES: DETROIT CBD more than 30,000 positions for eight consecutive quarters, dropping the unemployment rate to the lowest level since Marcus and Millichap Detroit Multifamily Market Report, Detroit Population 750k 500k 250k 0 Population Unemployment % 10% 5% 0% Unemployment CAP Rates 9% 6% 3% 0% Office Hotel Multi-family Retail Metro Area, Fourth Quarter 2016

11 THE DETROIT MARKET ECONOMIC SUMMARY Asking Rent per SqFt Asking Rent per SqFt RETAIL ASKING RENTS $13.50 $13.00 $12.50 $12.00 $11.50 Rent $11.00 Occupancy OFFICE ASKING RENTS $22 Rent 100% Occupancy $20 $18 $ % 75% 50% 75% 50% Occupancy Rate Occupancy Rate Rent per SqFt $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 Corktown MULTIFAMILY DISTRICT RENTS Downtown Eastern Market Lafayette Park Midtown New Center Nearly all (multifamily buildings) are at functional full occupancy, at 95 percent or more occupied. It is clear the rental market is extremely strong, and rents have increased significantly since the 2010 update... only a very few units are available at any one time, and several of the properties have waiting lists. Rivertown 100% 75% 50% - ZIMMERMAN/VOLK Update: Residential Market Potential for Greater Downtown Detroit Occupancy Rate

THE DETROIT MARKET HEAD QUARTERS MOVING BACK

are beginning to move back downtown to attract

regional offices and technical centers to ensure

s new-found renaissance is drawing young,

brought with them more than 25 tech start-ups,

state of Michigan, combined with corporate

12 THE DETROIT MARKET HEAD QUARTERS MOVING BACK DOWNTOWN REGIONAL LOCATION As corporate offices are beginning to move back downtown to attract and retain top-talent, the effects are evident in the real estate market. Companies are quickly relocating headquarters, regional offices and technical centers to ensure they are competitive in todays business environment. Detroit s genuine gritty culture, mixed with it s new-found renaissance is drawing young, entrepreneurial talent downtown, and they ve brought with them more than 25 tech start-ups, backed by more than $58 million in venture capital. As the single fastest growing tech hub in the state of Michigan, combined with corporate headquarters relocating downtown, the thriving labor economy is quickly impacting the downtown Detroit real estate market. That result is 16-year multifamily vacancies lows of 2-3%. *Proposed

THE DETROIT MARKET CURRENT DEVELOPMENT ACTIVITY 1 JAMES SCOTT MANSION - Mixed Use - 27 apartment + Retail 2 RED WINGS ARENA - 50 Block Mixed Use Development 3 THE SCOTT - 199 Unit Premium Apartments,

13 THE DETROIT MARKET CURRENT DEVELOPMENT ACTIVITY 1 JAMES SCOTT MANSION - Mixed Use - 27 apartment + Retail 2 RED WINGS ARENA - 50 Block Mixed Use Development 3 THE SCOTT Unit Premium Apartments, 200,000 sqft 4 BRUSH PARK Unit Apartment community 5 THE PLAZA - 72 Unit Apartment redevelopment 21 6 STRATHMORE HOTEL - $28 MM renovation TIGER STADIUM - Mixed-use development and community center 8 FOUNDATION HOTEL - 99 room boutique hotel 9 BOOK TOWER - 517,000 sqft mixed-use renovation THE GRISWOLD - 80 unit apartment building 11 MICRO APARTMENTS - 13 Story, 218 micro-unit apartments OLD HUDSON S SITE unit apartment building, retail + parking 13 FARWELL BUILDING - 82 apartment, mixed use redevelopment THE WURLITZER room hotel redevelopment 15 EASTERN MARKET 16 DUCHARME PLACE - 17 ORLEANS LANDING unit, mixed-use development 18 MLS DETROIT - Stadium, hotel, office and apartment (proposed) 19 OUTDOOR ADVENTURE CENTER 8 20 FRANKLIN LOFTS - Mixed-use loft redevelopment 21 FOREST ARMS - 70 unit apartment building 22 ALOFT HOTEL - 23 THE PASADENA unit historic apartment renovation 24 SYNCORA DEVELOPMENT SITE 8.9 Acre waterfront parcel

14 NEW REDWINGS AND PISTONS ARENA RENDERING

15 NEW REDWINGS AND PISTONS ARENA OPENING 2017

16 WOODWARD QLINE RENDERING

17 WOODWARD QLINE OPENING Q2 17

18 DEQUINDRE CUT BEFORE

19 DEQUINDRE CUT TODAY

20 ORLEANS LANDING RENDERING

21 ORLEANS LANDING OPENING APRIL 17

22 RIVERTOWN BEFORE RIVERTOWN TODAY

23 RIVERWALK BEFORE RIVERWALK TODAY

RED WINGS & PISTONS TIGERS STADIUM LIONS FORD FIELD MLS DETROIT

TRANSIT + STOPS Jefferson Ave. Chene st. Woodbridge st.

9 ACRES DETROIT RIVERWALK DETROIT RIVER BELLE ISLE Belle Isle Casino

Conservatory M1 RAIL PEOPLE MOVER Outdoor Adventure Center CHENE

DEVELOPMENT SITE (2017) UNITED STATES CANADA 10 Minute Walk 1/2 Mile

24 RED WINGS & PISTONS TIGERS STADIUM LIONS FORD FIELD MLS DETROIT (PROPOSED) GREEKTOWN & CASINO DISTRICT Rivard Dequindre Cut PLANNED TRANSIT + STOPS Jefferson Ave. Chene st. Woodbridge st. Atwater st Franklin st. Atwater Brewery CHENE PARCEL 8.9 ACRES DETROIT RIVERWALK DETROIT RIVER BELLE ISLE Belle Isle Casino Detroit Boat Club Belle Isle Zoo Belle Isle Aquarium Belle Isle Conservatory M1 RAIL PEOPLE MOVER Outdoor Adventure Center CHENE AMPHITHEATER Steve s Soul Food WOODWARD ORLEANS LANDING RFP DEVELOPMENT SITE (2017) UNITED STATES CANADA 10 Minute Walk 1/2 Mile GM Renaissance Center GM MIXED USE DEVELOPMENT (PLANNED) ATWATER PARCEL 2.7 ACRES DOWNTOWN & RIVERTOWN AMENITIES & ACTIVITY

The Chene option is made of 2 adjacent lots, spanning from the riverfront views of Atwater street to the primary traffic artery of Jefferson Ave.

25 The Chene option is made of 2 adjacent lots, spanning from the riverfront views of Atwater street to the primary traffic artery of Jefferson Ave. The Chene option is a 20-minute walk to the GM Renaissance center, and 5-minute walk to the Dequindre cut or the Detroit Riverwalk. Surrounded by so many amenities, the Chene option is ideal for a development seeking a quiet feel with quick access to downtown. The Chene parcel finds itself in the center of a district wide planning effort. The planning effort is calling for parks and run/bike paths as well as public transit stops to be installed adjacent to the parcels, with phase 1 work starting in The planning effort will also work to encourage higher density developments while relaxing the current parking space requirements. To help support the higher densities that the City and community are hoping for, the City is creating a tax incentive reserve designed specifically for Rivertown. Given the potential density of the site, around 1.8 million square feet of mixed product, the site is a priority for the City and willing to commit special project teams to support developer needs and ensure a successful development. LOCATION ACRES ZONING FAR ACTIVE LEASE DUE DILIGENCE AVAILABLE ( TWO CONTIGUOUS PARCELS) 2310 E. Jefferson 2290 E. Jefferson 301 Chene 281 Chene 2263 E. Atwater 8.9 Special Development District, Riverfront Mixed-Use 4 NO Detroit Dev. Agreement Title Survey Environmental Phase 1 Phase 2 Market Studies Architect Massing Studies CHENE 9-ACRE DEVELOPMENT SITE

The Atwater option is a 2.75 acre lot that is a 6-minute walk to the GM Renaissance center with unobstructed views along Atwater of the Detroit River and Miliken State Park.

26 The Atwater option is a 2.75 acre lot that is a 6-minute walk to the GM Renaissance center with unobstructed views along Atwater of the Detroit River and Miliken State Park. Atwater is a 20-minute walk to Campus Martius, the home of multiple corporate headquarters, and is the beating heart of Downtown Detroit. Adjacent to the Riverwalk and with such quick access to downtown, the Atwater option is a good location for developments that need a quieter berg with quick access to downtown Detroit. The Atwater parcel is also a subject of the Rivertown district planning effort. The planning effort is calling for parks and run/bike paths as well as public transit stops to be installed adjacent to the parcels, with phase 1 work starting in The planning effort will also work to encourage higher density developments while relaxing the current parking space requirements. To help support the higher densities that the City and community are hoping for, the City is creating a tax incentive reserve designed specifically for Rivertown. Given the potential density of the site, around 400,000 square feet of mixed product, the site is a priority for the City and willing to commit special project teams to responding to developer needs and ensure a successful development. LOCATION ACRES ZONING FAR ACTIVE LEASE DUE DILIGENCE AVAILABLE (CONTIGUOUS PARCEL) 1303 E Atwater 1365 E Atwater 1364 Franklin 1340 Franklin 1310 Franklin 1399 E Atwater 1325 E Atwater 1370 Guoin St 2.75 Special Development District, Riverfront Mixed-Use 4 YES Detroit Dev. Agreement Title Survey Environmental Phase 1 Phase 2 Market Studies Architect Massing Studies ATWATER 2.75 ACRE DEVELOPMENT SITE

27 CHENE TODAY

28 CHENE ARCHITECT CONCEPT

29 CHENE OPTION TODAY

30 CHENE OPTION ARCHITECT CONCEPT

31 ATWATER OPTION TODAY

32 DEVELOPMENT SUPPORT CITY AND INCENTIVES Both the Chene and Atwater sites have the potential for large and highly visible developments. City officials recognize there are unique challenges associated with such large developments. In response, multiple government groups have voiced their commitment to support these developments in multiple ways. As Syncora has other operations in the City of Detroit, the team can make introductions or help support the development effort as much or as little is desired. DISTRICT MASTER PLAN Lead by S.O.M. of NYC, the planning department and Riverfront Conservancy are finalizing a master plan for the Rivertown district. This plan is intended to standardize the zoning and permitting process to reduce the burden on development. Additionally, public resources like parks, public transit, bike paths and public programming will be implemented to help fully support the district development. INCENTIVES The City and community have a desire for high-density walkable neighborhoods but recognize there are financing gaps to achieving this. The City of Detroit and economic development groups are establishing incentive packages designed specifically for the Rivertown district. CITY SUPPORT Given the potential density of the sites, around 2.2 million square feet of mixed product, the site is a priority for the City. The City has offered to commit a dedicated city support team to respond to developer needs and ensure a successful development, similar to the new Red Wings Arena district.

DEVELOPMENT PARTNER DESIRED QUALITIES DEVELOPER CONTROLS THE DEVELOPMENT The developer will control all development decisions, including tax incentives and project financing.

33 DEVELOPMENT PARTNER DESIRED QUALITIES DEVELOPER CONTROLS THE DEVELOPMENT The developer will control all development decisions, including tax incentives and project financing. Syncora is not a developer and is looking to act as a passive joint-venture partner. EXPERIENCE & EXPERTISE The developer should be comfortable and able to develop large-scale, ground-up projects. Expertise should span multiple product types, allowing the developments to be whatever is best suited for the market. EQUITY PARTNER Only developers that have the desire to participate as equity partners will be considered. Additionally, the developer must be willing to lead and secure the tax incentives and necessary financing. ABILITY The partnering-developer must have the resources necessary to deliver developments of this scale, including organizational resources and financial capacity.

34 NEXT STEPS IF INTERESTED If your team is interested in further considering this development project, please contact the team below. We ll schedule an introductory call and provide the due diligence package for your review. Tom Waters (517) DUE DILIGENCE Documents Available TITLE SURVEY ENVIRONMENTAL DEVELOPMENT AGREEMENT MARKET STUDIES ARCHITECT MASSING & CONCEPTS ZONING REVIEW Mary Jane Constant TIMING We are looking for a developer and investment partner(s) to work on these projects by March 31st.

35 RIVERTOWN Acres of Detroit Waterfront Development Opportunity DEVELOP RIVERTOWN

150 West Jefferson. Detroit, Michigan. Magnificent, Class A Office Building with Spectacular Skyline and Waterfront Views

150 West Jefferson. Detroit, Michigan. Magnificent, Class A Office Building with Spectacular Skyline and Waterfront Views Magnificent, Class A Office Building with Spectacular Skyline and Waterfront Views Office and Retail Space Available in the Financial District s Premier Location 2,961 SF 30,000 SF office space available