NATIONAL MHC POrTfOLIO - …...National MHC Portfolio provides investors with an opportunity to buy two attractive 55+ communities plus additional land in the desirable CA market as

NATIONAL MHCPOrTfOLIO

A 3-PROPERTY MANUFACTURED HOME COMMUNITY PORTFOLIO INVESTMENT OPPORTUNITYMAJOR PRICE REDUCTION ON THE REMAINING AVAILABLE PROPERT IES IN THE PORTFOLIO

N A T I O N A L M H C P O R T F O L I O

A z t e c - Y u c c a V a l l e y , C AH o l i d a y - L o u i s v i l l e , K Y S t e r l i n g S h o r e E s t a t e s - L a k e C o u n t r y , C A

S t e r l i n g S h o r e E s t a t e s

A z t e c

H o l i d a y

ARA’s National Manufactured Housing Group is pleased to present this revised opportunity to purchase a three-property

portfolio in California and Kentucky. We previously marketed these with other communities in Michigan and Florida;

however, those have either sold or been taken off the market. The three remaining properties are now being offered

PRICED and at reduced prices from our original whisper numbers. The package includes two seniors (55+) properties

located in California and one all-age community located in Kentucky. The communities are three to four-star in quality

and can be purchased individually or as a portfolio. Any inventory homes or notes are being offered at COST.

The total portfolio consists of 546 sites including undeveloped expansion land in the Aztec community and undeveloped

mini-storage land in the Holiday community. The two CA communities should qualify for attractive non-recourse Fannie

Mae debt (please contact us for quotes). From an operational perspective, the CA properties are in the high 90% physical

occupancy range and Holiday is in the 80% range (providing upside opportunity compared to its comparables). The

National MHC Portfolio provides investors with an opportunity to buy two attractive 55+ communities plus additional land

in the desirable CA market as well as one well performing all age asset in the rebounding Midwest.

3 Property PortfolioPortfolio Price $23,300,000

PORTFOLIO INTRODUCTION

Aztec

Sterling Shore Estates

NATIONAL MHCPOrTfOLIO

Aztrec

Sterling Shore Estates Holiday

Holiday Sterling Shore Estates

SITE INFORMATION

Address 7425 Church St., Yucca Valley, CA 92284

MH Sites 164

Reduced Price $9,900,000

Year Completed 1975

Community Type Seniors (55+)

Land Size and Density 23 Acres; 7.13 sites/acre

Physical Occupancy 97.6% (as of December 2011)

Market Rent/Site/Mo $451 (includes sewer & 2012 rent increase)

Last Rent Increase $25 (as of January 1, 2010)

Projected Increase $15 (as of January 1, 2012)

Additional Expansion Land 4 acres zoned RM-10

Roads Asphalt

Utility System Electric Public (Individually metered - Southern CA Edison) Water Public (Individually metered - Hi Desert Water Company) Sewer Private septic Trash Paid by Tenant (Waste Management) Gas Public (Individually metered - The Gas Company)

1) Proforma GSR grown 3% from the Site Mix2) Utility and Other Income grown 3% from 20113) Adjusted Utilities grown 3% from 20114) Proforma Taxes = 100% of Price x 2011 Tax Rate; Opportunity to pass through tax increase to tenants with 90 day notice

INCOME 2010 2011 Proforma

GROSS SCHEDULED RENT1 $859,102 $860,005 $908,967Less: Vacancy 33,215 28,550 34,086Less: Bad Debt 0 0 2,272Less: Concessions 0 460 2,272TOTAL RENTAL INCOME $825,887 $830,995 $870,336 Plus: Utility Income 211.522 221,404 228,046Plus: Other Income2 7,464 12,680 13,060Plus: Tax Pass Through4 0 0 46,369Total Other Income 218,986 234,084 287,476EFFECTIVE GROSS INCOME $1,044,873 $1,065,079 $1,157,812EXPENSES 2010 2011 ProformaRepairs & Maintenance $7,670 $8,402 $8,200Payroll 54,652 50,701 53,300Administrative 11,307 12,929 12,300Marketing 0 0 1,640Utilities3

Electricity 82,580 78,809 81,173 Water 48,650 62,379 64,250 Gas 62,838 59,285 61,063 Trash 23,815 26,462 27,256TOTAL VARIABLE EXPENSES $291,512 $298,968 $309,183Taxes4 48,888 75,602 107,092Other Tax 1,780 1,709 1,775Insurance 9,416 9,979 9,512Management Fee 41,778 42,538 46,312TOTAL OPERATING EXPENSES $393,373 $428,795 $473,875Plus: Capital Reserves 0 0 5,740TOTAL EXPENSES $393,373 $428,795 $479,615NET OPERATING INCOME $651,500 $636,284 $678,197

INVESTMENT HIGHLIGHTS

AREA HIGHLIGHTS

Rare opportun i ty to acqui re h igh qual i ty 55+ communi ty •in Cal i fo rn ia

Communi ty shou ld qual i fy fo r the very at t ract ive non-•recourse f inancing at h i s tor ica l ly low rates th rough Fannie Mae (see debt in format ion sect ion)

Th i rd par ty home lenders s t i l l act ive in the area; •however , most res idents purchase home for a l l cash

Ameni t ies inc lude swimming pool , indoor spa, sauna, •gated dog run, RV s torage, c lubhouse wi th k i tchen, b i l l ia rds , poker room and laundry fac i l i t ies

Al l revenue producing s i tes are owned al l cash or are •th i rd party f inanced - there are no notes requi red to be purchased with the real estate

No rent cont ro l•

There i s a 4 acre undeveloped s i te (zoned RM-•10) avai lab le for expans ion that i s be ing of fered in con junct ion wi th the communi ty

Yucca Valley is situated along the Northern edge of the •beautiful Joshua Tree National Park, roughly 120 miles to the East of Downtown Los Angeles

The city has become a haven for retirees looking for a •clean, safe, and affordable community. It was named among the top 10 most affordable places to retire by the U.S. News & World report

The area boasts a high desert climate with moderate •temperatures, lots of sunshine, and little precipitation

Aztec MHP is situated right off Twentynine Palms Hwy, a •major thoroughfare that runs through Yucca Valley and leads to Interstate 10 to the Southwest

The community is located in close proximity to numerous •entertainment venues and restaurants including Blue Skies Country Club, Community Center Park, and the Cinema 6 theater across the street

The Community Center Park includes the Hi-Desert Nature •Museum, the senior center, Town Hall, the public library, and sports facilities among other things

The U.S. Marine Air Ground Combat Center is located •approximately 30 miles to the Northeast. It is the largest Marine base in the nation

FINANCIAL ANALYSIS

AZTEC Virtual Property Tour: http://youtu.be/Py_EmGX7tLI

DEBT INFORMATION

Proposed Debt (Quote from Newmark Capital)

Loan Amount - $7,365,000•

Term - 10 years•

Amortization - 30 years•

Rate - 241 bps over the 10-year swap rate (4.53% as of 3/1/12)•

Max LTV - 75%•

Recourse - No•

Assumable - Yes•

SITE INFORMATION

Address 8219 Minor Ln., Okolona, KY 40219

MH Sites 315

Reduced Price $7,700,000

Year Completed 1965 - 1970

Community Type All Age

Land Size and Density 37.37 acres; 8.43 sites/acre

Physical Occupancy 82.54% (as of December 2011)

Market Rent/Site/Mo $275

Inventory Homes Vacant - 9

Last Rent Increase $25 (as of March 1, 2009)

Additional Self Storage Land 0.946 acres

Roads Asphalt

Utilities

Electric Public (Individually metered) Water Public (Individually metered - Louisville Water Company) Sewer Public (Individually metered - Metropolitan Sewer District) Trash Paid by Tenant (Tenants billed directly)

1) Proforma GSR grown 0% from the Site Mix2) Utility & Other Income grown 3% from 20113) Adjusted Utilities grown 3% from 20114) Proforma Taxes = 100% of Price x 2011 Tax Rate

FINANCIAL ANALYSIS

INVESTMENT HIGHLIGHTS

AREA HIGHLIGHTS

Opportunity to acquire an all age manufactured housing •community with vacancy upside

Attractive non-recourse debt options available. Buyer may assume •the existing debt or seek new financing. Detailed information on each option is included in the debt information section

A zero tolerance delinquency rent policy was instituted decreasing •occupancy, but dramatically increasing the quality of tenant

Current owner has made substantial capital improvements to the •community over the past two years - fill upside is now available to be realized

Additional fully approved parcel abuts the property and can be •developed into a mini-storage property

All revenue producing sites are owned all cash or are third •party financed - there are no notes required to be purchased with the real estate

Community is serviced by public utilities (directly metered •municipal water and sewer) and all utilities are the responsibility of the residents

Amenities include an on-site office•

No rent control•

Holiday MHP is located on the southern side of Louisville, the •largest city in Kentucky with a population of over 1.3 million in the MSA

The community provides convenient access to major •thoroughfares such as Interstate 65, which leads through the heart of Louisville, all the way to Indianapolis, IN 124 miles to the North

Louisville International Airport lies minutes to the North, and •is the 5th busiest cargo airport in the nation. UPS operates its hub out of this airport

Holiday is located in the heart of what is called the •Renaissance Zone, a 3,000 acre zone South of the Airport that was established as a tax-increment financing district to encourage industrial development

UPS has taken advantage of the Renaissance Zone, allocating •$2 billion in expansion in the area since 2002, creating thousands of jobs

The community is situated in the heart of the industrial area •across the street from the UPS customer center expansion

HOLIDAY Virtual Property Tour: http://youtu.be/nTzi6WjTik8

INCOME 2010 2011 Proforma

GROSS SCHEDULED RENT1 $1,039,500 $1,039,500 $1,039,500Less: Vacancy 182,600 204,050 218,295

Less: Bad Debt 890 0 10,395

Less: Concessions 0 9,405 0

TOTAL RENTAL INCOME $856,010 $826,045 $810,810Plus: Utility Income 130,495 131,365 135,306

Plus: Other Income2 100,269 89,608 92,296

Total Other Income 230,764 220,973 227,602

EFFECTIVE GROSS INCOME $1,086,774 $1,047,018 $1,038,412EXPENSES 2010 2011 ProformaRepairs & Maintenance $62,462 $93,612 $63,000

Payroll 52,315 66,949 63,000

Administrative 10,508 11,507 15,750

Marketing 0 0 1,575

Professional Fees 0 0 3,150

Utilities3

Electricity 12,263 12,477 12,851

Water 138,963 133,940 137,958

Sewer 31,679 19,868 20,464

TOTAL VARIABLE EXPENSES $308,009 $338,353 $317,748Taxes4 79,347 80,346 74,716

Insurance 14,575 14,066 14,490

Management Fee 40,425 41,017 31,152

TOTAL OPERATING EXPENSES $442,356 $473,781 $438,106Plus: Capital Reserves 0 0 15,750

TOTAL EXPENSES $442,356 $473,781 $453,856NET OPERATING INCOME $644,418 $573,237 $584.557

DEBT INFORMATION

Current Assumable Debt

Current Balance - $3,743,000 (1/1/12)•

Maturity Date - September 2, 2014•

Rate - 5.45%•

Payment - $329,300 (Annual)•

Proposed Debt (Quote from Newmark Capital)

Loan Amount - $5,530,000•

Term - 10 years•

Amortization - 30 years•

Rate - 390 bps over the 10-year swap rate (6.02% as of 3/1/12)•

Max LTV - 70%•

Recourse - No•

Assumable - Yes•

SELF STORAGELAND

HOLIDAY

SITE INFORMATION

Address 5830 Robin Hill Dr., Lakeport, CA 95453

MH Sites 67

Reduced Price $5,700,000

Year Completed NA

Community Type Seniors (55+)

Land Size and Density 28.15 acres; 2.49 sites/acre

Physical Occupancy 100% (as of December 2011)

Market Rent/Site/Mo $539 (includes water & sewer)

Last Rent Increase $50 (as of September 1, 2010)

Roads Asphalt

Utility System Electric Public (Individually metered - PG&E)

Water Public (Individually metered - Lake Country Special District)

Sewer Public (Individually metered - Lake Country Special District)

Trash Paid by Tenant (Tenants billed directly)

1) Proforma GSR grown 0% from the Site Mix2) Utility & Other Income grown 3% from 20113) Adjusted Utilities grown 3% from 20114) Proforma Taxes = 100% of Price x 2011 Tax Rate; Opportunity to pass through tax increase to tenants with 90 day notice

FINANCIAL ANALYSIS

INVESTMENT HIGHLIGHTS

AREA HIGHLIGHTS

Rare opportunity to acquire high quality 55+ community with •mostly multi-section homes and lake views on California’s largest fresh water reservoir

Community should qualify for the very attractive non-recourse •financing at historically low rates through Fannie Mae (see debt information section.)

Park has approved plans for 7 Double Wide expansion lots and •room for considerable addition expansion in existing storage lot

All revenue producing sites are owned all cash or are third •party financed - there are no notes required to be purchased with the real estate

Third party home lenders still active in the area •

Amenities include swimming pool, boat launch, pier, clubhouse •with billiards, RV storage, laundry facility

Public utilities and no rent control•

100% leased park with 100% occupancy for over 5 years•

Located in scenic Lake County along the banks of the beautiful •Clear Lake, Sterling Shores Estates is situated within North Lakeside, a small quiet community only 120 miles Northwest of Sacramento, and just 72 miles North of the city of Santa Rosa

Clear Lake is the largest natural freshwater Lake in CA, and •is believed to be the oldest lake in the country. It is a very popular tourist destination and offers a variety of activities including world class fishing. It has been dubbed the “Bass Capital of the West”

Lake county has a meditteranean style climate with four •moderate, yet distinct seasons. It also boasts the cleanest air in California, as certified by the State’s Air Resources Board

The county also has a rapidly expanding wine culture, as the •number of vineyards are growing at a steady pace

North Lakeside is also home to the Sutter Lakeside Hospital, a •high quality 25 bed medical center that services most of the county

The 913,306 acre Mendicino National Forest, located within the •Coastal Mountain Range is located just 130 miles to the North

STERLING SHORE ESTATES Virtual Property Tour: http://youtu.be/m723KfvyV1c

INCOME 2010 2011 Proforma

GROSS SCHEDULED RENT1 $407,027 $432,960 $452,364Less: Vacancy 0 0 9,047TOTAL RENTAL INCOME $407,027 $432,960 $443,317Plus: Utility Income 50,572 48,465 49,919Plus: Other Income2 3,844 3,255 3,352Plus: Tax Pass Through 0 0 40,155Total Other Income 54,416 51,720 93,426EFFECTIVE GROSS INCOME $461,443 $484,680 $536,743EXPENSES 2010 2011 ProformaRepairs & Maintenance $3,298 $6,406 $3,150Payroll 18,221 18,966 18,550Administrative 3,596 2,692 3,850Marketing 0 0 700Professional Fees 398 1,222 420Utilities3

Electricity 2,203 2,497 2,572 Water & Sewer 33,941 34,746 35,788 Sewer Loan 6,120 6,124 6,308 Gas 694 782 805 Trash 114 150 155TOTAL VARIABLE EXPENSES $68,585 $73,584 $72,298Taxes4 32,601 29,933 56,950Special Assessments (Tax) 0 0 13,876Insurance 5,059 5,557 5,180Management Fee 18,458 19,387 21,470TOTAL OPERATING EXPENSES $124,703 $128,461 $169,774Plus: Capital Reserves 0 0 2,450TOTAL EXPENSES $124,703 $128,461 $172,224NET OPERATING INCOME $336,740 $356,218 $364,519

DEBT INFORMATION

Proposed Debt (Quote from Newmark Capital)

Loan Amount - $3,875,000•

Term - 10 years•

Amortization - 30 years•

Rate - 241 bps over the 10-year swap rate (4.53% as of 3/1/12)•

Max LTV - 75%•

Recourse - No•

Assumable - Yes•

1 Lakeport Lagoons 1800 South Main St., Lakeport, CA 95453 96 100% $600

2 Perks Estates 4265 Lakeshore Blvd., Lakeport, CA 95453 51 92% $400

3 Westwind Mobile Home Park 11270 Konocti Vista Dr., Lower Lake CA 42 95% $555

Lake County Communities Average 63 97% $518

RENT COMPARABLES

$539

Subject Property# Av. RentAddress

Sterling Shores Estates

Lake County Communities

5830 Robin Hill Dr., Lakeport, CA

Physical Occupancy

67 100%

Sites

The information contained in the attached marketing material is proprietary and confidential. It is intended to be reviewed only by the person or entity receiving it from Apartment Realty Advisors (the “Broker”).

This information has been prepared to provide a basic summary of the subject property or properties and should only be used to establish a preliminary level of interest in the potential purchase of the subject property. The information contained herein is not a substitute for a thorough investigation of the financial, physical, and market conditions relating to the property, which information will need to be independently verified by a prospective buyer.

While the information contained in this package is believed to be reliable, no representation or warranty is made regarding the accuracy or completeness of such information.

Neither the Broker nor the owner of the property makes any representation or warranty regarding the property including, but not limited to: income, expenses or financial performance (past, present, or future); size, square footage, condition, or quality of the land and improvements; presence or absence of contaminating substances (PCBs, asbestos, mold, etc.); compliance with laws and regulations (local, state, federal) or applicable zoning; or financial condition or business prospects of any current or prospective tenant. Any prospective buyer is solely responsible for any and all costs and expenses incurred in reviewing the materials and/or investigating and evaluating the property.

By accepting receipt of the attached information, you are agreeing to the Confidentiality and Disclaimers contained in this document. Contact with persons residing or working at the property is strictly prohibited. All questions and correspondence should be directed to: Todd Fletcher ([email protected]) .

www.ARAusa.com/ManufacturedHousing© copyright 2010 Apartment Realty Advisors, Inc. All Rights Reserved

02/2012

M A N U FA C T U R E D H O U S I N G I N V E S T M E N T S E R V I C E S

EXCLUSIVELY PRESENTED BY

ARA National Manufactured Housing Group

FOR MORE INFORMATIONON THIS PROPERTY

PLEASE CONTACT

NATIONAL MANUFACTURED HOUSING GROUP:

Todd Fletcher 512.637.1236

[email protected]

Andrew Shih 512.637.1219

[email protected]

901 S. MoPac Expressway Barton Oaks Plaza II, Suite 275

Austin, Texas 78746 Tel: 512.637.1237

Fax: 512.637.1740

ARA IRVINE:Jeff Patterson

DRE#01855862 949-385-5301

[email protected]

ARA NORTHERN CALIFORNIA:Mark Leary

DRE#01857662 916-764-4191

[email protected]

Holiday

Sterling Shore Estates

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