1 P3 CONNECT July 20, 2015 Jim Tucker Senior Vice President.

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P3 CONNECTJuly 20, 2015

Jim TuckerSenior Vice President

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WHY P3s? – FREEING CAPITAL FOR INVESTMENTS IN CORE

ACADEMIC/RESEARCH MISSION• Focus University investments on modernization of academic and

research facilities

• Generate annual ground rents and unlocking the value of the land• Add dynamic new street-level retail along major corridors

• Provide homeownership opportunities and neighborhood amenities such as childcare facility

Papadakis Integrated Sciences Building, 2011• 133,800 SF, $69M

URBN Center, 2012• 175,569 SF, $47M

Gerri C. LeBow Hall, 2013• 177,500 SF, $92M

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CHESTNUT SQUARE – AMERICAN CAMPUS COMMUNITIES

Winner, 2015 Philadelphia Urban Land Institute Willard G. “Bill” Rouse III Award for Excellence• Opened Fall 2013• 361,000 square feet, 861 beds • $100 million • 25,000 square feet of retail• Yogorino, Shake Shack, Joe Coffee, Zavino,

coZara, Plaza Artist Materials & Picture Framing, Franklin Mint Federal Credit Union

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UNIVERSITY CROSSINGS – AMERICAN CAMPUS COMMUNITIES

Winner INNOVATOR Award for “Most Creative Public/Private Partnership” by Student Housing Business magazine

• Land, sub-surface and air rights conveyed to Drexel in August 2013• Option to transfer building to Drexel at any time of DU’s choosing• ACC investing $30M in renovations• Total value: $68.5 million• 1,016 beds• 60-foot back-lit signage

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THE SUMMIT – AMERICAN CAMPUS COMMUNITIESWinner, Philadelphia Business Journal’s Heavy Hitters of Real Estate “Top Deals” Award

2015• Opening September 2015• 580,000 square feet, 1,316

beds• $170 million• 18,000 square feet retail• 21,000 square foot student

dining center

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THE SUMMIT – URBAN EATERY$9.3M Capital Investment from Sodexo

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THE STUDY AT UNIVERSITY CITY – HOSPITALITY 3

• Opening Fall 2016• 145,000 square feet• 212 rooms• Restaurant, Conference Center, Fitness Center• Extended-stay rooms on top floor• Operated by Study Hotels

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UNIVERSITY CITY HIGH SCHOOL SITE – JOINT VENTURE

• 14-acre site adjacent to west end of Drexel’s campus• Acquired June 2014 by Drexel University-Wexford Science &

Technology joint venture• Demolition of final building expected in fall 2015• 2.7 million gross square feet of potential development• $1 billion development value• Wexford development plans include: residential, research, office,

retail• Winner, Philadelphia Business Journal’s Heavy Hitters of Real

Estate “Top Deals” Award, 2015

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MIXED-USE/CHILDCARE DEVELOPMENT – 3201 RACE

• 164 market-rate apartments• 12 owner-occupied two-bedroom townhomes • 175-capacity childcare facility run by third-party operator• Currently in ground lease negotiations with Radnor Property

Group

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ADDITIONAL FUNDING STRATEGIES FOR CAPITAL PROJECTS

• RACP – State Grant Program: Used to help fund Papadakis ISB and LeBow Hall construction

• Tax Credits: • Dornsife Center for Neighborhood Partnerships – New

Market and Historic Tax Credits• Sheller 11th Street Family Health Services Center – New

Market Tax Credits• Kline Institute for Trial Advocacy – Pursuing Historic Tax

Credits

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SECTION TITLE | 2Key Ground Lease Terms

Key University Ground Lease Terms for P3 DEVELOPMENTS

• Ground Rent• Fee Not Subordinated • Completion Guarantee• Restrictive Covenant Against the Land (Deed)• Loan to Value Ratio Limits during construction and for

permanent financing to keep Lessee's equity in the project• Purchase Option• Reserve Fund for Replacements

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