EFTA00698802.pdf

International Government Properties LLC Preliminary & Confidential Overview of US GSA Pentagon Center Acquisition Opportunity Property Overview • 3rd largest GSA lease in metro area Property Location Arlington Virginia Two buildings combined SF 911,818 Tenant Department of Defense Ronald•RWagan Properties ”National Airport Pentagon Center I SF 353,631 pentagon Center Lease term 10 years 9/15 - 9/25 Pentagon Center II 558,187 Lease term 10 years 5/13 - 4/23 Congressionally approved 5 yr renewal 5/23 - 4/28 Resets of rents at 10 yr renewals Consolidated Financials Effective Gross Income $37 million NOI $27 million Acquisition Metrics Property Narrative: Acquisition Cost $387 million Located in Arlington, Virginia, Pentagon Center has been Equity $116 million solely leased to the Department of Defense since 1993. Located just one mile south of the Pentagon, Pentagon Cash on Cash 9.60% Center is the only property in Arlington, Virginia other IRA 13.77% than the Pentagon itself with the ability to meet the space and infrastructure needs of the DOD. Both buildings are Financing LEED Certified. LTV 70% Highly regarded as the DOD's prime campus, Pentagon Principal Amount $271 million Center is a best•in• class, secure office facility. Interest Rate 4.77% 3rd largest GSA lease in the DC metro area. Interest Only Period (Yrs) 5 Recent signing of the new 353,631 square foot lease at Amortization Periods 360 Pentagon Center I, and the recent signing of the 558,187 Annual Debt Service $13 million square foot renewal lease at Pentagon Center II, showcases DOD has made a long-term commitment to the Key Lease Terms Property. Rents are contractual obligations Mission Critical Asset: Given proximity to Pentagon - Backed by the full faith and credit of US Gov. investment in security and infrastructure extremely high • 10 year firm lease terms, non•cancellable during firm term probability for future renewals likely exceeding industry - No risk of default or vacancies average renewals of 95%. • No appropriation risks • No early termination International Government Properties • Real Estate taxes are reimbursable over base year Managing partners include Al ludicello and Jon Fascitelli - Annual CPI adjustment to operating expenses paid by Lessor Team has owned or managed over 650 buildings and 23.4 - Direct deposit of Rents to managers account million square feet of space valued at over $4 billion • 6 successful funds with audited track record Process • Know this property well; have extensive pipeline of • Submit LOI week of April 4 / select IGP capital partner properties to follow to build portfolio together in • 2.3 weeks for best and final programatic joint venture • Refundable 1st Deposit due upon Purchase Agreement Additional 5250 million to deploy in next 6 months Execution • Close in June • IGP can easily underwrite, dose and manage property Partnership • 10 Year Hold • 8% Preferred Return, 50%/50% split thereafter • 1.00%Acquisition Fee • 0.5% Asset Management Fee • Estimate $350,000 Expense Deposit • Fully Refundable Deposit: $2,000,000 EFTA00698802 Irte-9999 099 •••••• 901949111. 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CANON OM IA% 10.1% art 112% 9.1t4 9.0% 900 0i% Ione** to 4•411.111.9•MI 101% 140% 140% 99% 9911 011 CASH VIII I4*N90R4* NM 594% LL1V 113% TA ILA 00 9% IL .94 EFTA00698803  INTERNATIONAL IGP Executive Bios Ce,,n, en, P.operl re, MANAGING PARTNERS AL IUDICELLO After a 14 year career in executive level positions in the United States General Services Administration (GSA), the agency in charge of U.S. Public Buildings, Mr. ludicello successfully organized the first real estate fund in the United States specializing in the acquisition, aggregation and management of real estate assets leased by Government entities. He developed a business model for the financing and aggregation of private sector real estate assets leased to Government entities and private sector utility companies, and he employed this model in assembling and managing nationwide portfolios, consisting of over 650 buildings and 23.4 million square feet of space valued at over $4 billion. He has raised institutional equity, including European and sovereign wealth fund equity and arranged both balance sheet and CMBS debt financing with major international banks. He is well known and highly regarded by commercial and government real estate owners, developers and financial managers throughout the United States. Mr. ludicello graduated from the U.S. Air Force Academy, has an Exec MBA degree from Georgetown Univ. and an MCE degree. JONATHAN FASCITELLI Partner at International Government Properties LLC and Managing Partner of Blue Atlantic Capital LLC ("BAC"). BAC is a privately funded investment vehicle that targets a broad range of direct equity and debt investments in real estate, real estate related, specialty finance and financial services opportunities. In 2010, BAC acquired a bank to finance such transactions, then funded an equipment leasing business and has been active in a host of other specialty finance and real estate verticals. BAC specializes in partnering with sourcing and origination platforms, underwriting programmatic asset acquisitions, building asset appropriate capital structures to warehouse assets generated, and then syndicating and arbitraging lower costs of available capital. BAC, through Mr. Fascitelli and an extensive advisor network, has relationships with a vast and broad range of capital providers with varied costs of capital, from family offices that fund BAC transactions to institutional capital providers including private equity, sovereign wealth funds and insurance companies. Previously at Colony Capital, Mr. Fascitelli had been focused on programmatic investments, large buyouts/public investments and distressed situations. He has also worked in M&A banking at Dillon Read/UBS, principal investing for Time Warner, and business development for a startup. On a personal note, Fascitelli is the Chairman of the Lincoln Center's Young Patrons' board and a board member of NYPEN RE. Mr. Fascitelli graduated from Brown with a degree in Engineering and Economics and received masters from Harvard Business School. EFTA00698804 IGP Executive Bios INTERNATIONAL Goveenntent Propsales PARTNERS ROBERT RILEY Robert Riley is a principal in International Government Properties (IGP). Prior to IGP, Mr. Riley served as Executive Managing Director of Artesia Commercial Capital, LLC, a financial services firm providing fixed and floating rate debt financing, capital raising and advisory services to commercial real estate investors, with a heavy focus on real estate leased to governmental entities. Previously, Mr. Riley was Managing Director and a member of the Management Board at Dexia Real Estate Capital Markets, a subsidiary of Dexia Group. From 2002 until 2010, Mr. Riley was primarily responsible for the firm's origination activities, growing annual production from $220mm to $2.6 billion. During this time, the firm expanded its products to include fixed-rate CMBS, floating rate balance sheet lending, construction lending and credit lines. Total financings exceeded $10 billion. Total CMBS issuance topped $9 billion. Mr. Riley was directly responsible for originating more than $2 billion of loans to finance commercial real estate occupied by government agencies, primarily GSA. He was also instrumental in raising equity capital for investment in the government leased sector, including a direct investment of $75mm to help launch a Government leased real estate fund. Mr. Riley earned an AB. in economics from Brown University. CHRIS PENROSE Chris Penrose is President of The Penrose Corporation, a real estate development and investment company and a developer of GSA leased assets. He has agreed to collaborate with IGP in its new U.S. government leased real estate program. Presently, TPC is active in purchasing long term, 100% leased investment opportunities. From 1997 to 2004 TPC specialized in developing Class A office buildings for the General Services Administration (GSA). TPC's primary development focus was with the Department of Justice, Federal Bureau of Investigation (FBI). Mr. Penrose won the bids for, designed, built and managed 7 GSA leased FBI assets totaling over 1.6 million square feet. IGP purchased three of these assets (leased FBI buildings in Baltimore, Richmond and New Orleans) directly from TPC prior to completion of construction. The latest of these construction projects was the new, state-of-the-art, $100 million, 160,000 square feet headquarters and 20,00 square feet Annex facilities for all FBI operations in Hawaii, Guam, Saipan, and American Samoa, located on a 10 acre site in Kapolei's Barber's Point, Hawaii. Chris Penrose graduated from Western Michigan University and holds a JD from Thomas Jefferson School of Law. EFTA00698805