carroll gardens | brooklyn,...
TRANSCRIPT
160 Carroll Street Carroll Gardens | Brooklyn, NY
A High-Yield, Short Duration Investment Opportunity
Slide 2
This investment summary is provided for informational purposes only and does not constitute an
offer or solicitation to acquire interests in the investment or any related or associated company. Any
such offer or solicitation may be made only by means of the confidential Private Placement
Memorandum (“Memorandum”) and in accordance with the terms of all applicable securities and
other laws. All information contained herein is subject to and qualified by the contents of the
Memorandum. As more fully described therein, participation in any securities offering is limited to
Accredited Investors. Please contact NRIA Brooklyn II, LLC, a subsidiary of National Realty
Investment Advisors, LLC (“Sponsor” or “NRIA”), to inquire about obtaining a copy of the
Memorandum.
The information and any statistical data contained herein have been obtained from sources which we
believe to be reliable, but we do not represent that they are accurate or complete, and they should
not be relied upon as such. All opinions expressed and data provided herein are subject to change
without notice. NRIA and/or its members, directors, officers, consultants and/or employees, may
have agreements involving equity or other financial interests in the subject Property, or deal as
principals in the investment discussed herein.
This potential investment opportunity may not be suitable for all types of investors. All investments
involve different degrees of risk. You should be aware of your risk tolerance level and financial
situations at all times. Furthermore, you should read all transaction documents and statements. Read
any and all information presented carefully before making any investment decisions.
You are free at all times to accept or reject all investment recommendations made by NRIA. Past
performance is no guarantee of future results, and current performance may be lower or higher than
the performance data quoted.
The information contained herein should not be used in any actual transaction without the advice
and guidance of legal counsel and a professional tax advisor who is familiar with all the relevant
facts. The information contained here is general in nature and is not intended as legal, tax or
investment advice. Furthermore, the information contained herein may not be applicable to or
suitable for an individual’s' specific circumstances or needs and may require consideration of other
matters. NRIA, and its members, directors, officers, employees and consultants assume no
obligation to inform any person of any changes in the tax law or other factors that could affect the
information contained herein.
These materials may include forward-looking statements including financial projections, targets and
schedules on the basis of currently available information and are intended only as illustrations of
potential future performance, and all have been prepared internally. Nothing herein was prepared by
an independent third-party. Forward-looking statements, by their very nature, are subject to
uncertainties and contingencies and assume certain known and unknown risks. Since the impact of
these risks, uncertainties and other factors is unpredictable, actual results and financial performance
may differ from the details expressed or implied herein. NRIA assumes no obligation to release
updates or revisions to forward-looking statements after the issuance of this report.
Disclaimer
Slide 3
1. Investment Overview
2. Development Plan
3. Financial Overview
4. Investment Strengths
5. Ownership Structure
6. Map Views & Info
7. Carroll Gardens Area
8. Proposed Plans
9. US & NYC Housing Markets
10. Carroll Gardens Condo Sales
11. Sponsor Overview
12. Portfolio Examples (Exterior/Interior)
13. Development Partners
14. Contact
Table of Contents
4
5
6
7
9
10
11
12
20
23
18
26
21
27
Slide 4
Upon acquisition, NRIA has devised a 17-month
development plan (that may be extended to a
maximum of 20-months, but also may be
accelerated) that includes a complete renovation
to efficiently maximize & modernize the usable
square footage at the Property. The renovation
period will be followed by an estimated 3-month
marketing process (completed by marketing
partner: Compass), whereby the finished
condominium units (proposed plans: 160 Carroll
Street) have been conservatively estimated to
command ≈$1,470psf on average, based on a
current sales comparison analysis (comps
currently average ≈$1,589psf).
Accredited investors have the opportunity to
invest and receive a 12.0% annualized net return,
paid monthly, in a Preferred Equity position
guaranteed by the Sponsor. The investment is
senior to the Sponsor’s equity but junior to first
lien construction debt, which is also guaranteed
by the Sponsor and/or Borrowing entity. Investors
will receive 100% of principal and their targeted
12.0% net return before the Sponsor participates
in sale proceeds.
National Realty Investment Advisors (“NRIA” /
“Sponsor”) invites accredited investors to participate
in the short-term acquisition, complete renovation,
and conversion of a four-unit multifamily properties
(the “Property”) into a boutique three-unit high-end
condominium development, located in the prime
Carroll Gardens neighborhood of Brooklyn, NY. The
Property is currently under contract, and will be
NRIA’s eighth Brooklyn development of similar size &
scope since mid-Q2 2016.
The Property is more specifically located between
Henry & Clinton, just ≈2.25-miles south of Manhattan,
≈1.3-miles from the Brooklyn Bridge, and within a
short-walking distance to numerous subway lines
making for an easy commute anywhere in NYC.
Overview
Slide 5
Maximize FAR & Space
Utilization
Upon Completion Current Property Use
Development Plan
4-unit Multifamily Property
Square Footage: 3,020sf
Lot Size: ≈20.0ft x ≈100.0ft
Building Dimensions: ≈20.0ft x ≈54.0ft
Cost of Building: $3,150,000
Hard Costs (Fixed Contract): $1,623,000
Soft Costs (Inc. Contingency Reserve): $588,000
Senior Interest Reserve (Est.): $359,000
Preferred Interest Reserve: $440,000
Total Project Cost: $6,158,000
3 High-end Condo Units
Square Footage: 4,470sf1
Conservative Sell-out Value (Gross): $6,572,000
≈$1,470psf on average (comparable sales average
$1,589psf: comparable sales)
Estimated Condo Approval Timeline: 2-months after closing to finalize DOB plans (+/- a couple weeks). Once plans are complete, it is approximately 7-to-8
months (max) to get through the NY AG Real Estate Dept. Therefore, NRIA has an estimated outside date of 12-months from signed contract or 10-months from
closing (+/- a couple weeks).
Estimated 3- month marketing time for the
three-units, followed by a projected sell-
out by month 17-to-18.
Construction Timeline: NRIA expects the construction phase to last an estimated 14-months, commencing once all permits are
procured within 45-days of closing. October & November, 20 2016:
Contract Executed & Closing
Condo Timeline: ≈10-Months
Construction Timeline: ≈14-Months
Marketing: ≈3-Months
1. Includes increase in FAR, common area loss, plus additional sellable space to-be created (exterior space is typically
valued at 25% - 50% of interior valuations, while NRIA values on the conservative side of the range).
Building Dimensions: ≈20.0ft x ≈54.0ft
*Please note, all figures are rounded up to the nearest
thousandth, excluding PSF figures.
Slide 6
Financial Overview
*Sources and Uses
Sources
Construction Loan1 $3,431,000
Equity (Sponsor & Preferred Members) $2,727,000
Total Sources of Funds1 $6,158,000
1. The borrowing entity, the managing member entity, and the GC will provide recourse to standard
lender carve-outs and/or completion guarantees (loan structure to-be-finalized).
Initial term of 24-months. Prepaid interest reserve funded at closing. Loan paid monthly; estimated
L+800bp coupon, with an origination fee up to 2pts upfront. Construction Lender will be advancing up to
≈60% of Development Costs.
Uses
Purchase Price $3,150,000
Hard Costs1 $1,623,000
Soft Costs2 $588,000
Senior Lender Interest Reserve $359,000
Preferred Interest Reserve paid to Members3 $440,000
Total Uses of Funds1 $6,158,000
1. Hard Costs equate to ≈$325psf (calculated off of the total building envelope: ≈5,000sf).
2. Soft Costs include “Value Add” items; Environmental, Engineering, Legal Condo Conversion
(Structure & Closing), Architectural Plans, Fire Safety, etc., in addition to customary NYC closing costs.
Lender may also require a funded contingency reserve against the Hard Cost budget, which is included
in the total Soft Cost figure.
3. Interest paid to Investors over the duration of the project is reserved upfront.
*Exit Assumptions
Target Project Duration 17 months (20-Month Max Term)
Target Sale Price PSF (See Sales Comparables) $1,470psf (avg.)
Conservative [Gross] Sales Proceeds $6,572,000
RE Sales Commission (%) 4.00%
[Net] Sales Proceeds $6,309,000
Construction Loan Payoff -$3,431,000
Equity (Preferred Member then Sponsor) -$2,727,000
Net Profit from Condo Sell-out $152,000
*Preferred Member Overview
Preferred Member Capital Raise Up to $2,584,703
Number of Units Maximum of 30
Unit Price $86,157
Preferred Return 12.0%
Monthly Coupon Payment $862
Lenders estimated Basis
just $768psf, or 52%
below the average
market sell-out price
+ Additional credit
enhancements via
NRIA Buy-Back & Fixed
Cost Guarantees
(see Deal Strengths)
Market Sales Comp range:
$1,345psf - $1,942psf.
Average market unit size of
1,530sf is just 40sf larger
than the subjects average,
while our conservative price
PSF (est.) is well below the
average of the range…
Full financial model available upon request.
*Please note, all figures are rounded up to the nearest thousandth, excluding the Preferred Member Overview.
Slide 7
Strong, Seasoned, Established Sponsorship: NRIA has a 10+ year successful track record as a vertically-integrated investment, management, and development firm with extensive experience in
ground-up construction and complete renovation of planned unit townhome, condominium, and multifamily rental development in the Northeast, specifically Philadelphia and now expanding rapidly
into areas of NYC. Through strategic construction & property management agreements, NRIA maintains complete control through each investment(s) lifecycle, and currently has a portfolio of over 800
rental units. NRIA’s superior track record continues to support a growing investor base, which ultimately creates a liquidity profile that is quite unique in real estate development. Notable milestones:
700+ executed unit starts since 2010, delivering assets exceeding $500M in value. NRIA’s current project pipeline has a value of ≈$125M.
Unique Risk / Reward Investment Profile: In a world where all investors remain challenged to produce any yield to speak of, and with many global economists believing we are returning to normal -
away from relatively high interest rates and the resultant higher yields on bonds and other investment types for years to come, it seems logical prudent investors will shift investment interests to
alternatives such as real estate located in core urban markets, managed by superior sponsorship. The steady flow of income creates a natural hedge against unanticipated inflation without sacrificing
expected return. The subject investment is defined as a short duration (17-to-18-month), high-yield investment - offering a 12.0% net return, paid monthly. This current pay structure compensates
investors immediately and throughout the development process with an additional illiquidity premium generally reserved for longer-term investment profiles. Moreover, our constructive view on the
market should help our investment partners continually generate excess returns over the longer term horizon.
Equity Cushion upon Exit, and additional Sponsor Credit Enhancement(s): NRIA conservatively estimated total gross and net sales proceeds of $6.57 million and $6.31 million, respectively,
implying an as-completed price PSF of $1,470 (average), or a very healthy ≈15% margin1 over total project costs after returning all principal. Moreover, our sell-out estimate is considerably lower than
the average comparable sale in the market of $1,589psf, which if achieved would result in a ≈24% margin1 at the subject property. There clearly remains a substantial equity cushion vs. the
breakeven price PSF or where the NRIA Buy-Back price is set (see below, “ii”). It is this equity cushion that insures against a certain margin of error, with the Sponsor eligible for profits only after sell-
out. In addition to the above, NRIA has made other significant credit enhancements available to the investor(s) through:
(i) The borrowing entity (Carroll Street Capital 160, LLC), and flowing through to the managing member entity (NRIA Brooklyn II, LLC) executing recourse to standard lender carve-outs and/or
completion guarantees, in addition to the completion guarantee provided by the general contractor. This structure is intended to mitigate and distribute any perceived risk associated with growing
contingent liabilities. Due to the [current] ongoing negotiations with the construction lender(s), there also may be an element of cross-collateralization with the underlying Property and similar NRIA
sponsored loans. The final structure will be detailed in the operating agreement; however, NRIA anticipated these structural nuances and enhanced the investors position further through …
(ii) The NRIA Buy-Back agreement (Put-Option), whereby NRIA will acquire and pay investors for any unsold finished unit(s) at the end of the investment term in an amount (“breakeven price”)
guaranteed to return all investor capital. In the unlikely event the targeted sell-out price points were not met, the investment stability & low correlation of the NYC housing market vs. other markets,
broader S&P and/or REIT volatility, etc. (see further information), clearly make this an ideal longer-term rental investment for one of NRIA’s many high-net-worth partners utilizing their pledged
asset loan option (further information available upon request).
(iii) The NRIA Fixed Cost agreement, which requires the GC to cover all cost overruns during the duration of the project and eliminates the need for additional investor capital calls.
Ultimately, these structural features further illustrate NRIA’s ability to execute, and speak to how high we rank capital preservation.
Investm
ent S
trength
s
1. Calculated as gross sell-out over total project costs, assuming all principal is returned to investors.
Slide 8
Cost Efficiency / Fixed Cost Construction Contract: NRIA’s proprietary construction bidding process, volume of purchasing, and history with a core-team of development partners (contractors,
architects, engineers, building suppliers, etc.), have effectively created certain economies of scale as it relates to overall project costs. Furthermore, with over 90% of NRIA’s completed projects being
with our core GC (US Construction, Inc.), and within budget, both parties feel very comfortable executing a Fixed Cost Contract on all new projects, whereby the GC covers all cost overruns during the
duration of the project, eliminating potential delays due solely to cost disputes, etc. Construction costs are estimated at ≈$325psf at 160 Carroll Street, with finishes at an appraised quality standard of
“Q1” (exceptional, high-end custom build). Please note, these figures are far less than quotes given by “retail” contractors as high as ≈$500psf(+).
The Property is located in a Prime, Urban, Growing area of Brooklyn: NYC’s largest and fastest growing borough (population growth: +5.3%, 2010 – 2015), Brooklyn has over 2.6 million residents,
and if it was defined as its own City it would be the 4th largest in the US. The Property is more specifically located within the Carroll Gardens neighborhood of Brooklyn, and is just 2.25 - 2.5-miles from
Manhattan, and centrally located within walking distance to public transportation (see Property map). Brooklyn has emerged as an incubator for technology, advertising, media, design, and innovation,
which is shown through the (i) ≈120% increase in patent filings in Brooklyn over the last 5-years alone, and (ii) the number of adults with advanced degrees moving to Brooklyn tripling from 2009 to
20131. Population & job growth, shortage of new “affordable” supply, continued household formation, lack of developable air rights in the neighborhood, and interest rates remaining low for the
foreseeable future, are all important underlying fundamentals that should continue to drive robust growth for many years to come.
1. Source information through NYC Planning, and “Brooklyn showing ‘phenomenal’ job growth, Brooklyn Daily Eagle, 8/25/2016.
Investm
ent S
trength
s
Slide 9
Carroll Street Capital 160, LLC
(SPE, Borrower)
National Realty Investment
Advisors, LLC
Parent company to NRIA Brooklyn II, LLC
See Sponsor Track Record
Supports the fixed cost agreement
NRIA Brooklyn II, LLC1
(Managing Member Entity)
Sole Managing Member of Carroll Street
Capital 160, LLC
Sole Voting & Governance Authority
NRIA Brooklyn II, LLC is a wholly owned
subsidiary of National Realty Investment
Advisors, LLC
Preferred Member Interests1
Members of Carroll Street Capital 160, LLC
(All Voting Rights held with Managing
Member Entity)
Ownership Structure
1. Financial Ownership Interests to-be finalized once Senior loan parameters are set. As stated, sole
voting & governance authority always remains with the Managing Member Entity, and by extension, NRIA.
SPE created for the sole purpose to invest in one
specific multifamily, residential property located at
160 Carroll Street, Brooklyn, NY 11231
Slide 10
Map View
.
Subway Access
F G at Carroll, Smith, Bergen St. 0.27-0.50 miles
R 2 3 4 5 at Borough Hall 0.87 miles
The Property’s entire block has only 32,489sf1 of available air rights, distributed across many buildings, with the
largest portion held over a large rent stabilized building on the block.
Neighborhood Air Rights
1. Source: Property Shark.
Slide 11
…number of public & private education options
(a few listed below), make it an exceptional
living environment just outside Manhattan.
School District 15
PS 58, The Carroll School, 0.239-miles
PS 146, Brooklyn New School, 0.163-miles
“Charming Suburban Utopia”
160 Carroll Street is located in the prime section
of Carroll Gardens between Henry & Clinton
Streets, and very close to the Brooklyn New
School (PS 146) and Carroll Park (NYC Site).
Carroll Gardens…
continues to be thought of as one of
Brooklyn's top living experiences
attracting families, singles, and couples seeking
a long-term home (see change in area
demographic profile, far right corner).
Its central location, charming housing
stock, …
See local information available at:
Carroll Gardens Map Guide
Indicator1 2000 2014
$100,001 - $250,000 Income 31.4% 34.8%
$40,001 - $100,000 Income 36.4% 32.8%
Pop. Aged 25+ w/ College Ed. 53.4% 70.3%
Crime rate (per 1,000) 25.0 15.2
1. Source: NYU Furman Center, State of NYC Housing 2014/15.
Slide 12
Proposed Plans, Basement Unit 3, 3 Bed | 2.5 Bath Duplex
≈1,717sf
Rooftop Terrace
Unit 1, 2 Bed | 2 Bath
≈1,306sf
Den & Outdoor Garden
Unit 2, 3 Bed | 2.5 Bath Duplex
≈1,447sf
Outdoor Terraces
Slide 13
Proposed Plans, Garden Level Unit 3, 3 Bed | 2.5 Bath Duplex
≈1,717sf
Rooftop Terrace
Unit 1, 2 Bed | 2 Bath
≈1,306sf
Den & Outdoor Garden
Unit 2, 3 Bed | 2.5 Bath Duplex
≈1,447sf
Outdoor Terraces
Slide 14
Proposed Plans, 1st Floor Unit 3, 3 Bed | 2.5 Bath Duplex
≈1,717sf
Rooftop Terrace
Unit 1, 2 Bed | 2 Bath
≈1,306sf
Den & Outdoor Garden
Unit 2, 3 Bed | 2.5 Bath Duplex
≈1,447sf
Outdoor Terraces
Slide 15
Proposed Plans, 2nd Floor Unit 3, 3 Bed | 2.5 Bath Duplex
≈1,717sf
Rooftop Terrace
Unit 1, 2 Bed | 2 Bath
≈1,306sf
Den & Outdoor Garden
Unit 2, 3 Bed | 2.5 Bath Duplex
≈1,447sf
Outdoor Terraces
Slide 16
Proposed Plans, 3rd Floor Unit 3, 3 Bed | 2.5 Bath Duplex
≈1,717sf
Rooftop Terrace
Unit 1, 2 Bed | 2 Bath
≈1,306sf
Den & Outdoor Garden
Unit 2, 3 Bed | 2.5 Bath Duplex
≈1,447sf
Outdoor Terraces
Slide 17
Proposed Plans, Roof Terrace Unit 3, 3 Bed | 2.5 Bath Duplex
≈1,717sf
Rooftop Terrace
Unit 1, 2 Bed | 2 Bath
≈1,306sf
Den & Outdoor Garden
Unit 2, 3 Bed | 2.5 Bath Duplex
≈1,447sf
Outdoor Terraces
Slide 18
Still, if one were to argue we are heading towards
a housing “bubble;” there are three main
obstacles to such a conclusion1 other than Price-
to-Income ratio (note, the NE region remains well
below Western US regions, charted below left).
(i) Are there non-financial reasons for a high-
PTI ratio? Answer: Yes, significant supply
constraints in NYC, especially Brooklyn,
where a lack of developable air rights will
continue to provide a supply/demand
equilibrium,
(ii) Are credit conditions deteriorating? Answer:
No, and by extension,
(iii) Has leverage increased? Answer: No. Why
is the housing market in a better overall
position today? Simple – due to regulation,
lenders do not have an active securitization
market to sell subprime loans, nor would it
be profitable for a lender given regulated
reserve requirements.
Population growth / household formation, job
growth, a prolonged low-interest rate
environment, and lack of available “affordable”
supply, especially within NYC, all bode very well
for this specific type of short-term housing
investment.
US / NYC Housing Market
Unprecedented monetary stimulus has led a long rally in
treasury rates (charted left: averaged 4% 6-months prior
to the decline in the NY Condo Price Index, today
≈1.7%).
As housing dynamics shift from market-to-market, areas
of NYC, including Carroll Gardens (the Property’s
neighborhood) actually witnessed an overall increase in
home ownership rates throughout the broader US decline
illustrated above (≈28.7% mid-2000 to ≈37.1% by the
end of 2014).
Housing Prices: The US S&P Case-Shiller 20-City Index
declined ≈34%, peak (mid ‘06) to trough (early ‘12),
while the S&P Case-Shiller NYC Condominium Index
declined ≈16% (early ‘08 to early ‘12, charted above left).
As illustrated, due to insatiable demand, NYC condo
prices have surpassed the previous ‘height’; however,
today the credit & interest rate markets are vastly
different, with the 10-yr treasury ≈230bps(+) lower than it
was going into the previous ‘height’.
The resiliency of the NYC housing market will
undoubtedly continue as demand supports a shortened
timeframe to find a floor in housing prices as well as
rebound once that floor is found. The fact that the NYC
markets followed the broader US housing market into the
financial crisis by at least a year and a half (US peak mid
‘06, NYC peak early ‘08), allows for sufficient lead time to
determine the viability of an investment as a rental.
4.04
*3.18
4.44
5.15
2.00
2.50
3.00
3.50
4.00
4.50
5.00
5.50
6/30/2004 6/30/2006 6/30/2010 6/28/2013 6/30/2015 3/31/2016
Midwest PTI Northeast PTI Northwest PTI Southeast PTI Southwest PTI
1. Source: Freddie Mac 2016 Insights (Q2).
206.64
137.07
231.27
192.45
1.25
2.25
3.25
4.25
5.25
6.25
100.00
120.00
140.00
160.00
180.00
200.00
220.00
240.00
260.00
280.00
2000-0
1-0
1
2000-0
9-0
1
2001-0
5-0
1
2002-0
1-0
1
2002-0
9-0
1
2003-0
5-0
1
2004-0
1-0
1
2004-0
9-0
1
2005-0
5-0
1
2006-0
1-0
1
2006-0
9-0
1
2007-0
5-0
1
2008-0
1-0
1
2008-0
9-0
1
2009-0
5-0
1
2010-0
1-0
1
2010-0
9-0
1
2011-0
5-0
1
2012-0
1-0
1
2012-0
9-0
1
2013-0
5-0
1
2014-0
1-0
1
2014-0
9-0
1
2015-0
5-0
1
2016-0
1-0
1
S&P Case Shiller 20 Index S&P Case Shiller NY Condo Index 10YR UST (RHS)
Slide 19
S&P & NYC Housing Correlation (?) As broader markets have increasingly become more correlated over the
years, it is prudent for any Investor to be well educated on all variables
within the credit, equities, and rates market.
The first chart (left) simply illustrates the S&P Index and NYC Condo
Prices (S&P Case-Shiller NYC Condo Price Index) back 15+ years. It is
important to see at certain times when the equities market (S&P) sold-
off (example: tech-bubble of 2000), the NYC Condo market held-up
relatively well.
The second chart (below, left) illustrates the year-over-year price
changes in each Index over the same time frame. It is clear that the
volatility in the equities market is much greater than that of the NYC
Condo market, in fact, the correlation1 of the two over the last 15+ years
is < 35%.
Given this information, the Property’s investment profile should be
viewed as a stable, short-duration investment, and the fact these high-
end “affordable” units do not compete with certain pockets of NYC that
can be oversupplied with over-priced skyscraper units.
1. Measured through a regression analysis. Based on the number of
data points, below ≈60% is generally considered uncorrelated.
600
800
1000
1200
1400
1600
1800
2000
2200
2400
100.00
120.00
140.00
160.00
180.00
200.00
220.00
240.00
260.00
2000-0
6-0
1
2000-1
2-0
1
2001-0
6-0
1
2001-1
2-0
1
2002-0
6-0
1
2002-1
2-0
1
2003-0
6-0
1
2003-1
2-0
1
2004-0
6-0
1
2004-1
2-0
1
2005-0
6-0
1
2005-1
2-0
1
2006-0
6-0
1
2006-1
2-0
1
2007-0
6-0
1
2007-1
2-0
1
2008-0
6-0
1
2008-1
2-0
1
2009-0
6-0
1
2009-1
2-0
1
2010-0
6-0
1
2010-1
2-0
1
2011-0
6-0
1
2011-1
2-0
1
2012-0
6-0
1
2012-1
2-0
1
2013-0
6-0
1
2013-1
2-0
1
2014-0
6-0
1
2014-1
2-0
1
2015-0
6-0
1
2015-1
2-0
1
2016-0
6-0
1
S&P Case Shiller NY Condo Index S&P Index YoY (RHS)
-60.00%
-40.00%
-20.00%
0.00%
20.00%
40.00%
60.00%
-17.50%
-12.50%
-7.50%
-2.50%
2.50%
7.50%
12.50%
17.50%
2000-1
2-0
1
2001-0
6-0
1
2001-1
2-0
1
2002-0
6-0
1
2002-1
2-0
1
2003-0
6-0
1
2003-1
2-0
1
2004-0
6-0
1
2004-1
2-0
1
2005-0
6-0
1
2005-1
2-0
1
2006-0
6-0
1
2006-1
2-0
1
2007-0
6-0
1
2007-1
2-0
1
2008-0
6-0
1
2008-1
2-0
1
2009-0
6-0
1
2009-1
2-0
1
2010-0
6-0
1
2010-1
2-0
1
2011-0
6-0
1
2011-1
2-0
1
2012-0
6-0
1
2012-1
2-0
1
2013-0
6-0
1
2013-1
2-0
1
2014-0
6-0
1
2014-1
2-0
1
2015-0
6-0
1
2015-1
2-0
1
2016-0
6-0
1
S&P Case Shiller NY Condo Index YoY S&P Index YoY (RHS)
Slide 20
Carroll Gardens / Cobble Hill Condo Sales
1. Exterior space is typically valued at 25% - 50% of interior
valuations, while NRIA values on the conservative side of the range.
Location / Address Section Status Date Bed / Bath Unit Size Price Price PSF
173 Amity Street #4E Cobble Hill Listed Q3 2016 2 / 2 1,500sf $2,490,000 $1660psf
304 Warren St. #1 Cobble Hill Sold Q1 2016 2 / 2 1,234sf $1,660,000 $1345psf
210 Pacific St. #3W Cobble Hill Sold Q2 2016 3 / 2 1,563sf $2,486,719 $1591psf
229 Sackett St.#2 Cobble Hill Sold Q1 2016 2 / 2 998sf $1,499,000 $1502psf
229 Sackett St. #4 Cobble Hill Sold Q1 2016 3 / 2 1,291sf $2,036,500 $1577psf
325 Henry St. #2C Cobble Hill Listed Q3 2016 3 / 2.5 1,948sf $3,495,000 $1794psf
325 Henry St. #2B Cobble Hill Listed Q3 2016 4 / 3.5 2,166sf $3,975,000 $1835psf
325 Henry St. PHA Cobble Hill Listed Q3 2016 5 / 3.5 2,830sf $5,495,000 $1942psf
325 Henry St. #3A Cobble Hill Contract Q3 2016 2 / 2 1,250sf $1,995,000 $1596psf
#3 - 145 Summit Street Carroll Gardens Sold Q3 2016 2 / 1 950sf $1,499,000 $1578psf
#2 - 145 Summit Street Carroll Gardens Sold Q3 2016 2 / 1 900sf $1,399,000 $1554psf
#1 - 145 Summit Street Carroll Gardens Sold Q3 2016 2 / 1 1,650sf $3,122,000 $1892psf
341 Sackett Street #2 Carroll Gardens Listed Q3 2016 2 / 1 1,139sf $1,595,000 $1400psf
341 Sackett Street #3 Carroll Gardens Listed Q3 2016 3 / 2.5 2,010sf $3,225,000 $1604psf
291 Union St. #3A Carroll Gardens Sold Q2 2016 3 / 3 1,853sf $3,010,000 $1624psf
291 Union St. #5D Carroll Gardens Sold Q2 2016 3 / 3 1,823sf $2,700,000 $1481psf
291 Union St. #3H Carroll Gardens Sold Q1 2016 3 / 2.5 1,809sf $2,685,000 $1484psf
238 Carroll Street #2 Carroll Gardens Sold Q1 2016 3 / 2 1,156sf $1,900,000 $1644psf
116 3rd Place, #4 Carroll Gardens Listed Q2 2016 3 / 2 1,138sf $1,750,000 $1538psf
107 3rd St. #1 Carroll Gardens Listed Q3 2016 3 / 3 1,905sf $2,575,000 $1352psf
241 Carroll Street #4 Carroll Gardens Sold Q4 2015 3 / 2 1,520sf $2,420,000 $1592psf
536 Henry St. #2 Carroll Gardens Sold Q3 2016 2 / 2 1,036sf $1,430,000 $1380psf
Market Comp Range: Unit Size Price Price PSF
Min 900sf $1,399,000 $1345psf
Average 1,530sf $2,474,646 $1589psf
Max 2,830sf $5,495,000 $1942psf
160 Carroll Street (avg.) 1,490sf
1
160 Carroll Street, Conservatively Estimated Sell-Out $1,470psf
$1300psf
$1400psf
$1500psf
$1600psf
$1700psf
$1800psf
$1900psf
$2000psf
0,800sf 1,300sf 1,800sf 2,300sf 2,800sf
Listed Comparables: Price PSF & Unit Size
Avg. 160 Carroll Price PSF (est.) & Unit Size (Avg.)
Price
PS
F
Unit Size
Slide 21
NRIA is a vertically-integrated investment, management, and development firm with extensive experience in ground-up
construction and complete renovation of planned unit townhome, condominium, and multifamily rental development in the
Northeast, specifically Philadelphia and now expanding rapidly into areas of NYC. The firm has successfully executed
hundreds of construction starts since 2006, 700+ units in the last six-years alone, delivering assets exceeding $500M in value,
and a current project pipeline with a value of ≈$125M.
Through strategic construction & property management agreements, NRIA maintains complete control through each
investment(s) lifecycle. Our general contractor, US Construction, Inc., is the largest and most successful townhome developer
in Philadelphia with offices also in Hoboken, NJ to complete our NYC projects, and through Premiere Access Property
Management, our current portfolio of over 800 rental units continues to grow.
Firm Overview
700+
Successfully executed construction
starts since 20101
>$500Million
Value of assets delivered since 2010
290+
Units sold since 2014
1. Includes over 25 separate multi-unit developments, as well as SFR
projects. Property level information is available upon request.
$0
$100
$200
$300
$400
$500
-10
10
30
50
70
90
110
130
150
2010 2011 2012 2013 2014 2015 Apr-16
Mill
ion
s
Unit Starts (LHS)
Cumulative Completed Value (RHS)
Slide 22
Focus: (i) Target core urban markets in the midst of
gentrification, where we believe assets are located
directly in the path of long-term rent, unit sales, and
property value growth, (ii) Acquire what we feel is
significantly underutilized real estate, where we can
create value in the community and for our investors, (iii)
Maintain a highly-controlled, audited, development
process, while leveraging extensive underwriting, credit,
and capital markets expertise to prudently execute on a
growing opportunity set, ultimately offering investors a
scalable and repeatable investment profile.
While each investment, or series of investments, are
structured to extract the highest return for our
investment partners, it is clear our superior results of
delivering an average [project-level] equity multiple of 4x
continues to support a growing investor base
(accredited investors now 500+, with institutional
partners initiating allocations). As a result, not only has
our liquidity profile as a real estate development firm
dramatically improved, it also has laid a firm foundation
for future expansion.
Firm Overview
Project growth defined as cumulative development costs.
All information as of Q2 2016.
$0
$5
$10
$15
$20
$25
$30
$35
$40
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
2010 2011 2012 2013 2014 2015 YTD 2016
Mill
ion
s
Mill
ion
s
Cumulative Implied Equity (Completed
Value - Development Cost)
Cumulative Aggregate Capital
Raised/Invested (RHS)
$0
$50
$100
$150
$200
$250
$300
$350
$400
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
2010 2011 2012 2013 2014 2015 YTD2016
Mill
ion
s
Annual Per Unit Development Cost: a clear path to
providing luxury living in core urban markets
Cumulative Project Growth (RHS)
Deep knowledge within the core urban
markets of Philadelphia and NYC, executing
on a specific product type and investment
plan through market cycles.
Experience
Broad expertise across development,
construction, finance, investment, and asset
management.
Team
Full transparency and access is always
granted to our investment partners on current
projects, and our pipeline of opportunities.
Access
Maximizing productivity, cost efficiency, and
return on investment has led to a superior
reputation, which continues to drive growth.
Results
Slide 23 Slide 23
Portfolio Examples (Exterior)
1. Pressman Commons
2. Adagio
3. Queen’s Walk
4. Bedford Estates
5. Market Square
6. Bridgeview at the Waterfront
7. The Marian
8. Mildred Court
9. Ortlieb's Square
10. The Quarters at Fairmount
11. Manayunk Hills
12. 412 Luxe
1
2
3
4
5
6
7
8
9
Please see additional notable and current projects.
1 2 3
4 5 6
7 8 9
10 12 11
10
12
11
Slide 24 Slide 24
Portfolio Examples (Interior)
NRIA is committed to bringing the highest caliber of luxury design to each development, enhancing both interior and
exterior finishes through the use of premier appliances, only the finest materials, and state-of-the art technology. A
small sample of recent interior photos are illustrated below.
Slide 25
Notable & Current Projects
* Manayunk Hills
Darien Way
Crease Court
* Townhomes at 412 Luxe
The Courtyard at North Fifth
Total Value: ≈$39.80 Million
Townhomes at the Rye
*Pressman Commons
The Twenty
The Stables
Riverview at Front
* Mildred Court
Total Value: ≈$76.75 Million
*Queen’s Walk
* Market Square
Residences @ H3
Total Value: ≈$33.11 Million
* Bridgeview at the Waterfront
Lofts at Front
Franklin Village
Premier Estates on North Third
* The Marian
Total Value: ≈$102.59 Million
The Homes at Penn's Row
Fireman's Place
Logan Square
* Ortlieb's Square
* The Quarters at Fairmount
Total Value: ≈$66.61 Million
The Quarters at Fairmount
* Adagio
SoNo26
* Bedford Estates
Total Value: ≈$101.78 Million
In Progress (Examples):
Lippincott Alley
Black Horse Alley
116 – 130 Reed Street
184 Lincoln Place
377 Degraw Street
640 Baltic Street
647 Warren Street
1070 Bergen Street
143 Summit Street
434 Union Street
160 Carroll Street-Subject
279 Sackett Street
A complete list of projects is available upon request.
2011
2013
2014
2015 Q3 2016
* Also listed on previous slide.
Slide 26
Development Partners (Examples)
General Contractor
Architecture & Design
Structural Engineer, MEP/Fire Safety,
Zoning, etc.
Building Suppliers, Inspectors
Attorney, Real Estate Sales,
Property Management
Lenders, Appraisers, Insurance
Slide 27
Contact Us
201.210.2727
1325 Paterson Plank Rd
Secaucus, NJ