International Government Properties LLC

International Government Properties LLC Overview of US GSA Pentagon Center Acquisition Opportunity Preliminary & Confidential Property Overview • 3rd largest GSA lease in metro area Location Two buildings combined SF Tenant Properties Pentagon Center I SF Lease term 10 years Pentagon Center II Lease term 10 years Congressionally approved 5 yr renewal Resets of rents at 10 yr renewals Consolidated Financials Effective Gross Income NOI Acquisition Metrics Acquisition Cost Equity Arlington Virginia 911,818 Department of Defense 353,631 9/15 - 9/25 558,187 5/13 - 4/23 5/23 - 4/28 $37 million $27 million $387 million $116 million Cash on Cash IRA 9.60% 13.77% Financing LTV Principal Amount Interest Rate Interest Only Period (Yrs) Amortization Periods Annual Debt Service Key Lease Terms Rents are contractual obligations - Backed by the full faith and credit of US Gov. • 10 year firm lease terms, non•cancellable during firm term - No risk of default or vacancies • No appropriation risks • No early termination • Real Estate taxes are reimbursable over base year - Annual CPI adjustment to operating expenses paid by Lessor - Direct deposit of Rents to managers account 70% $271 million 4.77% 5 360 $13 million Process • Submit LOI week of April 4 / select IGP capital partner • 2.3 weeks for best and final • Refundable 1st Deposit due upon Purchase Agreement 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 Property Property Narrative: Ronald•RWagan ”National Airport pentagon Center Located in Arlington, Virginia, Pentagon Center has been solely leased to the Department of Defense since 1993. Located just one mile south of the Pentagon, Pentagon Center is the only property in Arlington, Virginia other than the Pentagon itself with the ability to meet the space and infrastructure needs of the DOD. Both buildings are LEED Certified. Highly regarded as the DOD's prime campus, Pentagon Center is a best•in• class, secure office facility. 3rd largest GSA lease in the DC metro area. Recent signing of the new 353,631 square foot lease at Pentagon Center I, and the recent signing of the 558,187 square foot renewal lease at Pentagon Center II, showcases DOD has made a long-term commitment to the Property. Mission Critical Asset: Given proximity to Pentagon investment in security and infrastructure extremely high probability for future renewals likely exceeding industry average renewals of 95%. International Government Properties Managing partners include Al ludicello and Jon Fascitelli Team has owned or managed over 650 buildings and 23.4 million square feet of space valued at over $4 billion • 6 successful funds with audited track record • Know this property well; have extensive pipeline of properties to follow to build portfolio together in programatic joint venture Additional 5250 million to deploy in next 6 months EFTA00698802 Irte-9999 099 •••••• 901949111. Taus.) *Maga C•s• PrtIaion 0340volel m•••.M1on O1, 5**18 at* UMW IbliflaWB*** Saniao w. inntss......t... — war — Oltf* - min - EMT - ORjt* - Oltf* - UMW - MET - ERAS - min - - OMIT - *TOW Oa*** 103% XC% I10 1.33% XO% XO% ION 10% 10% 10% 1.03% 1.00% Caleder. by i09: No 000•1140•••••• MUM IMMSO MMUS RSA* AMA 19.109991 AMA% "sawn if gmscris 0.9sans **MOS U•• PrVide1 91714147.000 Unrk 10 *a .4 • ***Co. 1,01.0 11.4.111 I.0. 4114 OSSA* SI /AO *3 t uts44 MUM. 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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