Jimmy LailDavid LailTyler Mainous08.06.07 Midland Development Analysis

Outline Project Overview Feasibility Analysis Equity Capital Funding Sales Process Investment Analysis

Project OverviewThe Concept100-unit luxury condominium development with 1st floor commercial space.

Project OverviewThe Amenities

Project OverviewSample Floorplan 2 bedrooms, 2 full baths +/- 1200 square feet Hardwood floors Granite counter tops Stainless steel appliances Balcony Highest quality construction

FeasibilityRegional & City Analysis Lexington 2000 Population: 260,512 Downtown Population: 5,000+ Downtown Workforce Population: 12,000 Approximately 1,000 Downtown Businesses 3 General Use Downtown Parks Home of the University of Kentucky and Transylvania University Major employers: U.K., Ashland Inc., Lexmark International, Inc., Toyota Motor Manufacturing, Link-Belt Lexington is experiencing rapid growth and redevelopment of its downtown

FeasibilityLocation Analysis 2 minutes from Downtown Core 5 minutes from U.K. Easy access to Winchester Rd., Richmond Rd., I-75, and I-64 Splits 2 historic residential neighborhoods Prime location for growth as Downtown Core expands

FeasibilitySite AnalysisDowntownMidland Avenue3rd StreetLewis Street Current zoning is I-1 Future zoning is MU-2 Existing structures: 3 commercial Traffic: 20,000 cars/day

FeasibilityProject Sales PriceComparable Lexington Condo Sales High$259.13 Low$176.66 Mid$217.90 Pool Fitness Center Starbucks Dry Cleaning Service Bar & Grill Highest Quality Construction$255

COST

Book Example% of Total CostItemCost% of Total Cost

Excavating$111,0003.82%Excavating$573,4333.82%

Cement Work$240,0008.27%Cement Work$1,239,8558.27%

Masonry$279,0009.61%Masonry$1,441,3329.61%

Steel & bar Joists$142,0004.89%Steel & bar Joists$733,5814.89%

Metal Door Frames$23,0000.79%Metal Door Frames$118,8190.79%

Carpentry Work$172,3855.94%Carpentry Work$890,5525.94%

Roofing$88,0003.03%Roofing$454,6143.03%

Plumbing & Sewer Work$116,0004.00%Plumbing & Sewer Work$599,2634.00%

Electrical Work$169,0005.82%Electrical Work$873,0655.82%

HVAC$368,32012.69%HVAC$1,902,76412.69%

Insulation$2,4000.08%Insulation$12,3990.08%

Dry Wall$80,0002.76%Dry Wall$413,2852.76%

Acoustical Ceiling$42,9651.48%Acoustical Ceiling$221,9601.48%

Hardware$8,2000.28%Hardware$42,3620.28%

Cabinets & Mirrors$2,0500.07%Cabinets & Mirrors$10,5900.07%

Painting$12,2000.42%Painting$63,0260.42%

Electrical Fixtures$61,0152.10%Electrical Fixtures$315,2072.10%

Tile & Carpet$50,8501.75%Tile & Carpet$262,6941.75%

Paving$150,8505.20%Paving$779,3015.20%

Parking Lot Striping$3,5000.12%Parking Lot Striping$18,0810.12%

Outdoor Lighting$8,5000.29%Outdoor Lighting$43,9120.29%

Sprinkler System$110,0003.79%Sprinkler System$568,2673.79%

Roof Paneling$30,5001.05%Roof Paneling$157,5651.05%

Plate Glass$68,3152.35%Plate Glass$352,9202.35%

Gyp Roof Material$83,3502.87%Gyp Roof Material$430,5912.87%

Weather Stripping$2,0000.07%Weather Stripping$10,3320.07%

Architect Fees$145,0004.99%Architect Fees$749,0794.99%

Permits$40,6651.40%Permits$210,0781.40%

Surveys$2,0000.07%Surveys$10,3320.07%

Contractor's Overhead and Profit$290,50010.00%Contractor's Overhead and Profit$1,500,74110.00%

Estimated Total Cost$2,903,565100.00%Estimated Total Cost$15,000,000100.00%

VALUE

Sale #Square FeetPricePrice/sq. ft.AppearanceAmmenitiesLocationAdjusted PriceSALES OF COMPARABLE DOWNTOWN CONDOS/LOFTS

11,354$282,986$209.00Less 5%Less 10%Sale #Square FeetPricePrice/sq. ft.

21,655$303,710$183.51Less 5%Less 10%11,365$353,710$259.13

31,365$353,710$259.13Less 5%Less 10%21,495$364,800$244.01

41,470$285,230$194.03Less 5%Less 10%31,271$307,500$241.94

51,495$364,800$244.01Less 5%Less 10%41,354$282,986$209.00

61,170$206,690$176.66Less 5%Less 10%51,470$285,230$194.03

71,655$293,710$177.47Less 5%Less 10%61,655$303,710$183.51

81,271$307,500$241.94Less 5%Less 10%71,655$293,710$177.47

Subject Property81,170$206,690$176.66

Price/sq. ft.

High$259.13

Low$176.66

Average$210.72

Sheet3

Equity Capital Funding225 MidlandOwner: Will Dale Properties, LLCAcreage: 0.43Property Value: $455,000261 MidlandOwner: BrashearAcreage: 0.12Property Value: $500,000EQUITY PARNTEREQUITY PARNTEROPPORTUNITY!

Equity Capital FundingINVESTMENT OPPORTUNITY

INVESTORAMOUNT% of TOTAL265 Midland EQUITY PARTNER$630,00016.0%261 Midland EQUITY PARTNER$500,00012.7%225 Midland EQUITY PARTNER$455,00011.5%Soft Costs$2,355,00159.8%TOTALS$3,940,001100%

Sales Process On-site sales center and agent Website Weekly newspaper ads Local PR campaign Shopping the Bluegrass TV segmentSales & Marketing Strategy

Investment AnalysisEstimated Profit*Sales Revenue$37,850,000 Less: Land Costs 1,585,000 Less: Construction Costs 25,835,013 Less: Soft Costs 2,355,001 Less: Realtor Costs 918,000Profit $7,156,987* Please see Excel sheet for greater detail

Investment AnalysisShare of Profit** Please see Excel sheet for greater detail

INVESTOR$ IN% Share of Profit$ OUTProfit $265 Midland EQUITY PARTNER$630,00016.0%$1,444,391$925,600261 Midland EQUITY PARTNER$500,00012.7%$908,247$408,247225 Midland EQUITY PARTNER$455,00011.5%$826,505$371,505Soft Costs$2,355,00159.8%$4,277,844$1,922,844TOTALS$3,940,001100%$7,156,987$3,216,986

Questions & Comments?