TOTS Development Company

Ashburn CrossingLoudoun County, Virginia

Joey QiJanka Durisova Cheng Ji Doreen Liu Sherlock Zhou Zach Kayce

Summary StatementJoint Venture TOTS Development & St. John Properties

200 units – Luxury garden-style multifamily project at the corner of Loudoun County Parkway and Gloucester Parkway in Ashburn, Virginia

Expected return over 20%

Location

The Metrorail (Silver Line) will be extended into Loudoun County by 2018

Gloucester Parkway will be extended past the Redskins Park to connect with Route 28

Upcoming Silver Line and Gloucester Parkway Extension

Market Study – Ruled OutRetail - Fierce competition from One Loudoun

Office - High Vacancy Rate (16.9% - 19%)

Flex/Industrial - High Vacancy Rate (14%) Oversupply (400,000 SF under construction)

Market Study – DemographicsAccording to the 2010 Census:

Household Income Chart:

Loudoun CountyPopulation 328,533 (2012 Estimate)

Median Household Income $119,134 (#1 Ranked in USA)Household Size 3.37

Potential Renters

Market Study - Vacancy

According to Cassidy Turley Multifamily Snapshot – Fourth Qtr. 2012

Apartment rents grew at a controlled rate of 3.1% in 2012

Vacancy RateDC Metropolitan 3.9%

Loudoun County 4.2%Average Asking Rents (Loudoun) $1505

Market Study - DemandExisting competitors:

Ashburn MeadowsParc Dulles ApartmentAshboroughSaddle RidgeVillage at Potomac Falls

No new construction in our immediate market Ashburn Meadows

Saddle Ridge

Ashborough

Village at Potomac Falls

Parc Dulles Apartment

Current Year Year 5

Marginal Demand 259 475

Improvement – BudgetTotal development cost $ 38,396,050

Hard Cost

27485428.718132372%

Soft Cost

7660621.4006331120%

Land Cost3250000

8%

Improvement – Unit MixImprovements:

Total GBA : 250,025 SFTotal Net Rentable: 200,000 SFTotal Units: 200 unitsAverage Unit Size: 1,000 SF

Unit Mix:

Jr 1 BR/1 BA15%

1 BR/1 BA35%

2 BR/1 BA15%

2 BR/2 BA17%

3 BR/2 BA18%

Improvement – Details Exterior:

• 1st Floor – Concrete; 2nd & 3rd Floor – Wood• Brick & Wood Facade

Interior: • High-end interior finishes• Granite countertops, shaker inspired cabinetry, Italian porcelain tiles, chef kitchen sinks, African hickory hardwood, marble countertops in the bathrooms• Keyless entry system to enter your apartment home

Common Areas:• Clubhouse - a study area/computer lounge, fitness center, pool,

resident lounge, Wi-Fi, party room for rent

Timeline Timeline

Begin: June 2013Construction period: 24 monthsLease-up period: 12 months

Month 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29Constructi onLease-upMove- i n Stabl i zed

TeamDevelopment Team

Equity Partner Architecture

Construction Management Company Legal Consultant

Lender

Major Participants

Project Manager

Lead Engineer

Sr. Financial Analyst

Lead Architect

Sr. Developer Sr. Developer

Reversion Split 45%

Cash Flow Split After Pref 55%

Preferred Return St. John then TOTS

HUD Loan Debt

St. Johns Contribution$ 3,250,000

Return

IRR with Reversion (2022) = 20%

Sensitivity Analysis

Variables:

1- Market Rent2- Vacancy3- Cap Rate

Risk• Market Risk

Increases with potential oversupply of competitive properties with the Silver Line coming on board

• Interest Rate RiskInterest rate increases resulting in higherCapitalization Rate

• Inflation RiskOperating expenses inflate higher than rental rates

RecommendationJV with TOTS Development 10 acres at $3,250,0008 Pref – 55% Cash Flow Split – 45% Reversion SplitIRR 20% in 2022

Contact Information

TOTS Development1625 Massachusetts Avenue

Washington, DC 20002(703)-203-1128

ashcrossing@tots.com

Questions & Comments

Slides Reference1- Intro2- Summary Statement3- Location4- Metro + Route 28 Ext.5-8 – Market Study9-11- Improvements12- Timeline13- Development Team14- Return15- Sensitivity Analysis16- Risk17- Recommendation