PLANTATION AT FAYETTEVILLE

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1 PLANTATION AT FAYETTEVILLE

2 EXECUTIVE SUMMARY THE INVESTMENT OPPORTUNITY Plantation at Fayetteville (the Property ) is a 360-unit garden apartment community constructed in two phases (2014 / 2016) and competitively positioned with direct access to Fort Bragg; the largest military base in the world with 53,000 active duty troops and 10,000 civilian contractors. The Property enjoys easy access to the recently-completed All American Expressway (opened in 2016), a major thoroughfare providing direct access to Fort Bragg and I-295. Phase I leased up quickly, and the lack of competitive supply in the market has led to impressive leasing velocity in Phase II (20 leases per month), which is currently achieving a $45 premium over Phase I. IMMEDIATELY ADJACENT TO THE WORLD S LARGEST MILITARY BASE PROPERTY ADDRESS 3050 Plantation Garden Blvd, Fayetteville, NC CUMBERLAND COUNTY GIS PIN(S) ; DEVELOPER Berkley Hall Construction, LLC YEAR BUILT Phase I: 2014 Phase II: 2016 ACREAGE # UNITS 360 Total 240 Phase I 120 Phase II DENSITY (UNITS/ACRE) 8.38 CURRENT LEASED% AS OF 2/13/2017 AVG. UNIT SIZE (SF) 1,183 Phase I: 91.2% Phase II: 74.1% TOTAL SQUARE FEET 425,880 IN-PLACE EFFECTIVE RENT $920 (AS OF 1/23/2017) EFFECTIVE RENT PSF (AS OF 1/23/2017) $0.78 PARKING SPACES TOTAL PARKING RATIOS 599 Spaces 49 Garages 1.8 per unit 1.3 per bedroom Plantation at Fayetteville is the closest multifamily property to Fort Bragg and is less than 2 miles from the entrance due to immediate access to the All American Expressway, the main thoroughfare into Fort Bragg. ACCRETIVE FEDERAL ADMINISTRATION CHANGE The changing political climate is expected to be positive for military expansion. Experts have estimated the incoming administration will boost U.S. military spending by $500 million - $1 Trillion dollars over the next 10 years as well as substantially add to the Army s ranks, a number of which will likely be stationed at Fort Bragg. EXCEPTIONAL LEASING VELOCITY Phase I delivered in 2014 and stabilized quickly, while Phase II delivered in May 2016 and is averaging an impressive 20 leases per month. Additionally, Phase II is achieving a $45 rent premium over Phase I. Currently, Plantation is 87% leased is now approaching stabilization. POSITIONED TO DRAFT OFF OF ADDISON RIDGE Across the street from Plantation at Fayetteville, Addison Ridge achieves the top rents in the market at $1,130 per month. Addison leases at nearly $250 more per month, leaving Plantation in the enviable position of Discount Provider to a high-caliber competitor. In fact, management reports notable spillover demand. PLANTATION AT FAYETTEVILLE HFF

3 IDEAL PATH OF GROWTH LOCATION WITH TRANSFORMATIONAL INFRASTRUCTURE IMPROVEMENTS With the recent completion of All American Expressway in 2016 providing direct access to Fort Bragg and the planned completion of the I-295 outer loop surrounding the city, Plantation at Fayetteville is well positioned to benefit from surrounding infrastructure improvements. Moreover, the area within a 1-mile radius of the Property has seen 13% household growth since 2010 which has been largely driven by quality schools, ongoing infrastructure improvements and proximity to Fort Bragg. NCDOT is planning to complete I-295 a $400 million highway improvement project connecting a loop around Fayetteville, which will further improve access to Plantation. ATTRACTIVE YIELD PREMIUM TO PRIMARY CAROLINAS MARKETS At a time when cap rate compression is pushing investors out of many markets, Plantation at Fayetteville presents an opportunity to acquire a new apartment community at a basis-point yield premium to primary markets. NEW VINTAGE CONSTRUCTION AND IMPRESSIVE AMENITY PACKAGE Plantation at Fayetteville s masonry construction, well-appointed units, expansive pool and outfitted clubroom distinguish it from the majority of its competitive set. LOW RATE ASSUMABLE DEBT ON PHASE I [Freddie Mac #: ] $18.75MM loan securing Phase I and the clubhouse (Original LTV: 69.8%), 10-year agency loan originated April 23, The fixed interest rate is 3.89% with an initial 60 month interest only period. Additional leverage can be added to Phase II which will be delivered free and clear. A Phase II appraisal dated September 30, 2016 concludes as is market value of $14.25MM or $118,750 per unit. PLANTATION AT FAYETTEVILLE HFF

4 PLANTATION AT FAYETTEVILLE HFF

5 TO RALEIGH: 63 MILES CAPE FEAR VALLEY HEALTH SYSTEM: 916 Beds CROSS CREEK MALL: (100 STORES AND 1MM SF OF RETAIL) SEARS TO CHARLOTTE: 134 MILES BRAGG BLVD WAL-MART MACYS The Fresh Market Carolina Ale House Chick-fil-A Panera Bread Chipotle LOWES IMAX ALL AMERICAN EXPRESSWAY ADDISON RIDGE: $1,130 AVG RENT ALL AMERICAN EXPRESSWAY: NEW LEG OPENED IN 2016 SANTA FE DRIVE (36,000 VPD) PLANTATION AT FAYETTEVILLE 5 TO 10 MINUTES: FORT BRAGG (63,000 EMPLOYED PERSONNEL) via ALL AMERICAN EXPRESSWAY 1.5 MILES investment advisors analysts debt advisors ALLAN LYNCH Director alynch@hfflp.com JUSTIN GOOD Managing Director jgood@hfflp.com JEFF GLENN Managing Director JGlenn@hfflp.com SARAH GODWIN Associate SGodwin@hfflp.com GEORGE SCHUBERT Real Estate Analyst GSchubert@hfflp.com TRAVIS ANDERSON Senior Managing Director tanderson@hfflp.com ROGER EDWARDS Director REdwards@hfflp.com