Associated Property Solutions Business Plan

Mission Statement  We will provide high quality property management services that are dedicated to the owners goals and objectives. Our growth will be by referral and targeted marketing.

The Team  David J. Fortune CPM ® -20 years property management experience in office buildings and Bank facility management for National City Bank. Managed a portfolio of up to 211 locations and ranging from 125 years old to new construction. President elect (2005) IREM West Michigan chapter.  Kerry Baumgartner -10 years in various roles at National City bank, including Facility Manager for a portfolio of 40 locations throughout Central Michigan. Facility call center supervisor for 3 years for properties located in Illinois, Michigan and Indiana.

Market Summary The target market  Business manager in a non-core function  In house management  Owner management

Market Summary Target Core clients  CSM Group  WSI Health  EPI Printers, Inc.  Mid-link Business Park

Market Summary Target Clients  Community and regional Banks and Credit Unions  CSM Group past and future customers  Office building owners in Southwest Michigan

Opportunities  Need for quality light duty maintenance on an incremental basis in a timely fashion at what is perceived to be a reasonable fee.  Provide comprehensive facilities services via our specifications and quality subcontractors.  Provide solutions for deferred maintenance.  Provide solutions for facility updates and facility expansion goals.

Opportunities  Preserve the investment that CSM Group customers have made in their property.  Provide specialized property management to targeted financial services clients that do not have the scale to warrant in house staff.  Deliver goals of value enhancement, cash flow, or facility management to office building owners.

Business Concept  We will manage for a fee the properties of target clients.  We will target clients that want high end, beautiful properties with curb appeal impact.  We will offer partnerships to key core clients.  Our fees will be based upon a percentage of the operating budget, flat fee, percentage of the effective gross income, hourly rate, or not to exceed maximum  We will utilize economy of scale to reduce common materials costs

Competition  Local competitors are Gardener Management; Signature Associates.  Regional and national competitors are Viox; Jorgenson and Associates; Unicco, and York International.

Competitive Advantages  Leveraging the CSM Group contact network to expand relationships  Our ability to utilize contacts with key Bank executives and Office building Owners to present strategies to deliver their goals  Our quality staff and exceed expectations approach, and our 30+ years experience  Establishment and leveraging of core portfolio will allow us to be perceived as the dominant property services provider as their is currently a void in market leadership.

Goals & Objectives  Five-year goals –2 new clients per year, 10 in 5 years. –500,000 square feet under management in 5 years –Manage 2 class A properties in Downtown Kalamazoo –$400,000 gross annual revenue for year 5 –3 years until net operating income (profitability) is achieved

Financial Plan  Pricing based on $.65 square foot base fee  Additional potential revenue from lease commissions not included  Year 0 projections for revenue assume revenue begins 4 th quarter

Year 0-5 revenue and profitability  Year 0 revenue $13,000. Net loss of  Year 1 revenue $84,500. Net loss of  Year 2 revenue $150,100. Net loss of  Year 3 revenue $244,300. Net profit of $52,600  Year 4 revenue $316,150. Net profit of $117,850  Year 5 revenue $403,400. Net profit of $156,100  Total Owners Equity $233,720

Resource Requirements  Technology requirements -TCOM, PC, Printer, Fax, Copier, Software  Personnel requirements-Administrative -1 part time year 0 -2 Full time year 3 -2 Full time, 1 Part time year 5 -Non-Admin billed internally and passed through

Resource Requirements  Resource requirements –Funding until breakeven –Promotion to CSM clients –Utilization of CSM infrastructure –Acquire Real Estate License  External requirements –TCOM Services –Bank Accounts

Risks & Rewards  Risks –Unable to acquire first client –Inexperience in sales –Quality of part time administrator –Loss of investment funds  Addressing risk –Defer compensation year 0; work part time –Objective, in depth analysis of the local marketplace in Q1 of year 0 –Staff with experienced person

Risks & Rewards  Rewards –Owners equity of $230,000 after year 5 –Diversity in Business line with steady revenue –Break even in year 3 –Opportunity for CSM for other sales in existing core business due to “Continuous Touch” –Personal sense of satisfaction

Key Issues  Near term –Review, advise and edit Business Plan –Complete in depth Market Analysis –Revise Business Plan post market analysis  Long term –Owners equity agreement –Consequences of decision postponement  Start up funding is $50,000

Property Management Tasks Retain TenantsNegotiate leasesObtain TenantsHandle Tenant relations CollectionsReview/Approve leases Prepare Financial reportsMake decisions about acquisitions & dispositions Prepare operating budgetsMaintenanceMonitor property performance Negotiate tenant improvements Prepare overall management Plan Prepare Capital Budgets AdministrationMake decisions about redevelopment Analyze project feasibilityMaintenance Supervision On-site inspectionsMonitor property value Approve rent SchedulePrepare rent scheduleEstablish/monitor/enforce operating policies and procedures Analyze/implement financial structures Real estate tax monitoringEstablish/Modify lease procedures Construction/renovation supervision Construction/renovation Handle Broker relationsEnvironmental monitoring Insurance procurement and monitoring Work with legal counsel Provide Architectural and design control PurchasingGovernment complianceHandle advertising & Public relations

Property Management Tasks: Revenue Methods Retain TenantsNegotiate leasesObtain TenantsHandle Tenant relations CollectionsReview/Approve leases Prepare Financial reportsMake decisions about acquisitions & dispositions Prepare operating budgetsMaintenanceMonitor property performance Negotiate tenant improvements Prepare overall management Plan Prepare Capital Budgets AdministrationMake decisions about redevelopment Analyze project feasibilityMaintenance Supervision On-site inspectionsMonitor property value Approve rent SchedulePrepare rent scheduleEstablish/monitor/enforce operating policies and procedures Analyze/implement financial structures Real estate tax monitoringEstablish/Modify lease procedures Construction/renovation supervision Construction/renovation Handle Broker relationsEnvironmental monitoring Insurance procurement and monitoring Work with legal counsel Provide Architectural and design control PurchasingGovernment complianceHandle advertising & Public relations Multiple WaysPercent of total Flat FeePer Diem

Facility Management Tasks Prepare operating budgets MaintenancePrepare Financial reports Prepare Capital BudgetsAdministrationPurchasing Analyze project feasibility Maintenance Supervision On-site inspections Monitor property valueGovernment complianceEstablish/monitor/enforce operating policies and procedures Provide Architectural and design control Construction/renovation supervision Construction/renovation

Facility Management Tasks: Revenue Methods Prepare Operating budgets MaintenancePrepare Financial reports Prepare Capital budgetsAdministrationPurchasing Analyze project feasibility Maintenance Supervision On-site inspections Monitor property valueGovernment complianceEstablish/monitor/enforce operating policies and procedures Provide Architectural and design control Construction/renovation supervision Construction/renovation Flat Fee Percent of total Per Diem Multiple Ways