1. Multi-Unit Rags to Riches

2. Month 1 – Agenda Identifying Markets & Marketing Strategies Locating Multi-Unit Opportunities Identifying Possible Markets Marketing Strategies Acquisition – Analysis – Negotiations “In – Field” Physical Due Diligence Identifying Value Plays Turn Key vs. Reposition

3. Private Money – Equity Partners Syndication Working With Commercial Banks Property Management “In - Field” Building Your Team Rehab Budget & Scope of Work Contractors Working With City, Town, County Month 2 – Agenda Funding & Financing

4. Due Diligence Operations – Management of Your Team Forms & Documentation Settlement Preparation “In – Field” Property Take Over 1-3-5 Year Plan Resident Relations Investor Relations Month 3 – Agenda Due Diligence

5. Identifying Your Target Markets for Multi-Unit Investing Local Markets Emerging Markets Stabilized Markets

6. Understand the Market Cycles Research / Potential Markets of Interest Identify What Cycle Market is In Learn the “Path of Progress” What is/has been/will be the Trends “Trust but Verify Resources”

7. Market Cycles Cautious Buying Buy SM 1 BM1 = Buyer’s Market Phase 1 BM2 = Buyer’s Market Phase 2 SM1 = Seller’s Market Phase 1 SM2 = Seller’s Market Phase 2 SM2 BM 1 “Vulture Buyers” BM 2 Don’t Buy

8. The Market Cycles Market CycleCharacteristicsStrategy Buyer’s Market Phase 1 Price/Rents Falling Demand falls Unemployment highest Excess supply Time on market longest, inventory on market idle Foreclosures sharply increase Oversupply of property so lots of concessions Cautious Acquisitions Buy for Cash flow in Local Markets Cash on Cash Returns to be a minimum of 15% Buyer’s Market Phase 2 Time on Market Decreases Absorbing Oversupply Job Growth increases Prices and rents slowly increase Existing properties being rehabbed Foreclosures Begin to Decrease Buy & Hold for Appreciation

9. The Market Cycles Market CycleCharacteristicsStrategy Seller’s Market Phase 1 Supply Dwindles Properties sell fast Unemployment Low Prices/Rent Rising Lots of speculation Construction Starts to accelerate Buy & Hold Ride Appreciation Wholesale Seller’s Market Phase 2 Time on Market increases and number of properties on market increases Rents become stagnant Potential for overbuilding Property bought on speculation, not cash flow Business/jobs begin to slow Sell, Have Cash, Cash flow, Liquidity Do NOT Buy

10. Identifying Market Opportunities Research…Research…Research… ◦ www.MilkenInstitute.org / www.MarcusMilichap.com www.MilkenInstitute.org  100 Best Performing Large Cities Report 100 Best Performing Large Cities Report  100 Best Performing Small Cities Report 100 Best Performing Small Cities Report ◦ Look at Statistics, Employment, Census Information, Data Trends, Verify Capital Infusion, Building Permits ◦ Demographics, Psychographics, Zip Codes

11. Identify Your Target Markets 1 - Local Market 1-2 Different Target Markets Identify Property Specifics

12. www.DunHills.com

13. Gather Market Data ◦ Chamber of Commerce ◦ Military Bases ◦ Major Employers in Area ◦ New Businesses Coming to area ◦ Medical Facilities Hospital Expansion ◦ University-School-Technology Growth ◦ Comprehensive Plan ( County – City) Identifying Market Opportunities

14. Understanding the Market Understanding the Market Identify Maps of City/Town with Zip codes Gather Demographics of Target Market (s) ◦ Census Data and Projected Forecasts ◦ Employment Statistics / Job Growth ◦ www.ARA.com American Realty Advisors ◦ www.Loopnet.com (household information) ◦ www.RedCapitalGroup.com www.RedCapitalGroup.com ◦ www.Realtor.com

15. Contact Local Chamber of Commerce ◦ www.ChamberofCommerce.com ◦ Questions to ask:  Employers Moving In/Out of Area?  Types of Housing Needed and Areas Needed In?  Status of Area Affordable Housing Programs?  City/County/Town Plans for Next 5 Years?  Areas of Most Growth?  Path of Progress? Understanding the Market Understanding the Market

16. Research Local Newspapers Online Gather Data on Current Rents in Area Contact Local Community Managers Seller Concessions ◦ 1 Month Free ◦ No Security Deposit Required Research Articles, Stories, Current Events Understanding the Market

17. Understanding the Markets Research City/County/Town Comprehensive Growth or Development Plan  Types of Employment – Companies Arriving /Leaving  Timeframe of Expected Arrival, Length of Stay  Percentage of New Jobs to be Created ◦ Comprehensive City /County / Town Plan Comprehensive City /County / Town Plan Identify Major Employers in Area:  Their Location ( Corporate, Industrial, Manufacturing)  Research Current Unemployment Rate  Increasing – Steady - Declining

18. Baltimore 2010 GROWTH Report

19. Understanding the Market Contact Economic Development Office / Team Questions to Ask? How many NEW multi-unit building permits? Have building permits increased or decreased? Perception on Housing Market Conditions? Types of Housing Most Needed? Potential Housing Programs / Organizations/

21. Understanding the Market Identify Empowerment / Enterprise Zones Tax Credits Rehab Incentives www.BaltimoreCountyMD.gov

22. Empowerment Zones and Enterprise Zones

23. Understanding the Market Research and Identify Commercial Realtors/Brokers in Area Make Contact and Interview Share Your Investment Criteria ◦ Example..20-100 Multi-Family Apartment Units ◦ 9-11 Capitalization Rate ( Cap rate) ◦ Age of Building Criteria ◦ Areas of Focus ◦ Occupancy & Vacancy Preferences ◦ Ask Questions about their Specific Knowledge of Area ◦ Path of Progress in the Area ◦ Preferred Zip Codes ◦ Their Area of Expertise, Years in Business, Potential Properties ◦ Request Information on Possible Properties

24. Your Homework Is To: 1.Research Possible Markets of Interest to You 2.Identify Those Markets 3.Indentify the Market Cycle 4.Research and Understand the Market 5.Contact and Communicate with Commercial Brokers/Realtors 6.Identify Property Types Your Interested In Apartments, Mobile Home Communities, Self Storage 7. Order a List from www.DunHills.com

25. Clean Out Party – Giving Back