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PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710MALYSHKA PTY LTD

OPPORTUNITY ALERTMalyshka - Alderley, Centenary Heights - Toowoomba

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

BUILDING FINANCIAL SUCCESS

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PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

OPPORTUNITY ALERT FAST FACTS AT A GLANCE>> LOCATION: HIGH-END 8 x 3BR TOWNHOUSE DEVELOPMENT - TOOWOOMBA, QLD, AUSTRALIA

>> PIECES OF PIE UP FOR GRABS: 8 (TWO ALREADY SOLD)

>> MINIMUM INVESTMENT (ONE PIECE OF PIE): $120,000

>> ROI: A PREDICTED 58.8% ROI IN 18 MONTHS

INTERESTED? READ ON....

HELLO THERE. After hours of number crunching we’re excited to bring you our latest opportunity alert.If you’re interested, don’t delay. This opportunity alert goes public within 2 weeks from today.

Email: makemoney@malyshka.com.au

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

MALYSHKA ALDERLEY CENTENARY HEIGHTS SUMMARYa simple document explaining our assumptions, our due diligence

and our research on this development

This document is designed to allow you to understand the research that was completed as part of the due diligence by the Developer and incorporates the key areas of project viability.

These are:

1. Land price and Demographics2. Construction price and delivery3. Market expectations4. Risk management5. Key !nancial assumptions6. Summary

1. Land price and demographics

Toowoomba, like Townsville in the north, plays the role of the Capital of the west. It’s just 130km west of the Brisbane CBD and can be reached by car in about 90 minutes. Toowoomba sits on the Great Dividing Range and at the junction of Warrego, New England and Gore Highways, and it serves as the gateway to the Darling Downs agricultural region and the Surat Basin mining/gas precinct.

Toowoomba is Queensland’s third largest city, wit the wider region holding close to 165,000 full-time residents. The region’s permanent population base is expected to increase to over 200,000 people within ten years and close to 245,000 within the next 20 years. This equates to 3,500 new people or 1,300 new homes needed each year.

Within a generation, Toowoomba has the potential to double its population.

The Toowoomba Regional Council has approved in principal around 3,200 new allotments which, based on recent sales trends, equates to around a 5 year supply. Yet, just 750 new lots receive operational works approval per year, which allows actual subdivision to occur, sales to be made and houses to be built. Based on the estimated need for 1,300 new dwellings per year the reality is that Toowoomba is currently not providing enough new stock onto the market.

It’s a fact that today’s property hotspots are where billions of $$’s are being invested in long-term resource development. Queensland’s Surat Basin is probably the hottest with more than $180 billion either underway or committed. These are projects with up to 30 years life in them.

The Surat basin and Toowoomba, however, is not dependent on any one industry or commodity, with coal, gas, power generation, solar energy, coal seam gas, water projects, rail infrastructure, farming and supporting business all present in the area. This means the area’s economy is protected from downturn if one industry sector endures a bad period.

Thousands of new jobs are being created and housing needs to be built to accommodate all of these

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new people.

The land for this project is a NON-DA approved development site located in the suburb of Centenary Heights

Centenary Heights is a suburb of Toowoomba, Queensland, Australia, located 4 kilometres from the central business district.

Previously part of Middle Ridge, the area was named Centenary Heights in 1960 in honour of the separation of Queensland from New South Wales in 1859.

276 Alderely Street is located less than 4KM to the CBD and is a 1639 m" zoned for mixed housing. Some highlights:

8 Restaurants with a 1.1 km radius8 Cafes within a 1.5km radiusColes, Woolworths and Aldi all less than 1.2km8 Parks less than 2.2 km radius (closest is 200m from the front door)10 Schools within a 1.2km radius

Sites like this, are getting harder and harder to !nd. However, due to the GFC and the banks reluctance to lend to developers, we have been able to secure this site.

At $450,000 the land price on a per dwelling basis is approximately $56,2500. We consider this EXCELLENT buying for a site this close to amenities and an inner suburb of Toowoomba. The Toowoomba Regional Council has also released an incentive for projects over 3 dwellings with a potential $13,500 reduction (per 3 dwellings) in their infrastructure charges for projects in the next 15 months ending July 2014.

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

2. Construction price and delivery

Our highly skilled Development Management Team at Malyshka have under taken developments of this type before and has years of experience with the acquisition and development of property. Malyshka currently have 2 other projects underway in Toowoomba. Projects of this nature, being low-set residential, have the lowest construction risk of any development. The construction industry has been going through considerable contraction over recent years and as such there is an over supply of the resources needed to construct this project e.g. painters, carpenters, plumbers etc. This means that we are unlikely to see supply price spiking during construction. Notwithstanding this, the mineral resource boom is picking up many tradespeople.

This is an important point, as we need to ensure the conditions are such that the builder can !nish the build as well as make a reasonable pro!t from the construction process. This particular project has been thoroughly costed and the builders’ budget has been viewed and assessed by Malyshka.

The nominated builder, Craig Maindonald from Mainz, has over 25 years’ experience in this type of construction.

The contract is a guaranteed maximum price contract or GMP. This means that under no circumstances can there be any builder driven variations to the contract no matter what they !nd or are required to do.

The builders obligation is to build to agreed time frame, make their margin and give us the keys.

3. Market expectations

The current real estate market gets a lot of press and is often talked about as softening. What this refers to is the average price of property in the market. We agree with this market position, and see it e#ectively as a de-leveraging of the sector.

This means that the new thrifty consumer who is shunning debt and is looking to reduce their mortgage is bringing down the average price. This is creating an extreme softening in the high-end housing sector of the real estate market where in some cases, price reductions are already down 30%.

This in turn has created an increased demand for high quality, well priced housing or product that represents a downsizing {both monetarily and physical size}.

In this project we are not making money through market growth, but our philosophy is to make money from manufacturing the product at a wholesale rate, and selling it on the retail market.

Having said that, we are of the belief that Toowoomba is positioned for signi!cant growth in the coming years, as various industries ‘take o# ’. Queensland Market Commentator, Michael Matusik, of “Think Matusik” currently believes Toowoomba is at 6 o’clock on the property clock – indicating the market is positioned for upswing in the coming cycles.

Malyshka expects the coming years will deliver solid growth, on the back of “business boosting news” for Toowoomba and this could see an improvement in the current valuation of this project expects.

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PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

Toowoomba has been nominated as a “hotspot” by various Australian property commentators and Australian property magazines.

Overall this is exactly the product we want to build: a high quality product close to lifestyle amenities and city style infrastructure at a spot that allows you to invest in the real estate market and providing you with a healthy rate of return.

We have allowed 12 months from start of construction in our costings for this project, although expect it to be !nished before then; it is better to be conservative. Total project time is estimated at 18-20 months.

*Reference: Michael Matusik.

4. Risk Management

A risk to delivery is the builder not meeting its obligations, Malyshka have mitigated this by:

1. Malyshka Pty Ltd.’s experience ensuring there is no deviation from the planned construction $ow.

2. A quantity surveyor is engaged to certify the “costs to complete” at each payment stage, as well as ensure each payment is made based on contracted !nished works.

3. We are not using any bank debt to secure the land, the DA or the Op Works.

4. Time for delivery has been dealt with by no debt being used to !nance the land and a !xed build price.

5. Though our program has this project being completed in 9 months from when we start construction we have allowed for 12 months worth of holding charges and costs (which don’t get spent if we !nish earlier)

6. Guaranteed Maximum Price Contract (or GMP) from the builder.

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PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

5. Key Financial Assumptions

In preparing the Development cash $ow our key assumption and risk on the revenue is the gross realisation. We have completed a thorough examination of recent sales and believe our sales prices are at today’s market – we have not built in possible growth in the next 18 months of the development program – it is possible to add 10% to these !gures and still be conservative.

The cost risk associated with the cash $ow has been mitigated through binding agreements with resource suppliers.

The Feasability Summary table shows that an investment of $120,000 will potentially return 58.8% via equity in approximately 18 months.

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Feasability Summary

Returns

This document comes to you from Malyshka Pty Ltd the Developer. The following table incorporates all of our assumptions.

Development Address 276 Alderley St Centenary Heights Toowoomba

DA Approved? NoTime to Complete Development? 18 MonthsHow Many Dwellings will be Built? 8What are you planning to build? 8 x 3bed Townhouses Total Income $ $ 3,360,000.00 Total Purchase Cost $ $ 468,175.00 Total Consultant Cost $ $ 260,000.00 Total Construction Costs $ $ 1,800,000.00 Total Selling Fees $ $ 15,000.00 Total Contingency Costs $ $ 45,000.00 Total Borrowing Amount $ $ 1,935,285.51 GST Income Tax Credits $ 176,863.64 GST Collected on Income $ 266,363.64 Total Borrowing as a % of GRV 57.60%Margin Before Interest $ $ 671,904.88 Less Borrowing Interest $ $ 107,190.39 Pro!t Margin $ $ 564,714.49 Total Development Cost $ $ 2,815,285.51 Margin on Development Cost % 20.06%Cost Per Dwelling $ $ 351,910.69

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PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

Alderley Centenary Heights COMMENTSGross Purchase Price $351,910.69 16.7% Discount to Estimate Market Value

Estimated Market Value at Today’s Price (April 2013)

$422,500.00 Estimate based on discussions with local agents and Actual Sales Comparisons

Estimated Total Cost for Retail Buyer $444,470.00 20.8% Discount to Ordinary Retail Buyer

COMPARISON TO RETAIL PURCHASEEstimate Retail Price $422,500.00 Stamp Duty $18,590.00 Estimated Legal Expenses $3,380.00 Total Cost $444,470.00 $92,559.31 Total cost saving versus Retail Buyer

INVESTMENT SUMMARY

Cash Equity Invested $120,000.00

Manufactured Equity $70,589.31 Return on Investment 58.8%

COMPARISON TO RETAIL PURCHASE

Estimated Retail Price $422,500.00 Stamp Duty $18,590.00 Estimated Legal Expense $3,380.00 Total Costs $444,470.00 $92,559.31

Investment $120,000.00 27.0%Implied Loan $324,470.00 73.0%Estimated Purchase Price $444,470.00 100.0%

Malyshka Project Purchase Price $422,500.00 Less Development Equity $70,589.31 Gross Purchase Price $351,910.69 Stamp Duty -Estimated Legal Expense $2,815.29 Estimated Purchase Price $354,725.97

Cash Equity Investment $120,000.00 Less Project Management Fee/Townhouse

$10,000.00

Implied Loan Amount $244,725.97 57.9% LVR of Loan to Estimated Market Value

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Estimated Purchase Price $354,725.97

LVR COMPARISON

Ordinary Retail Purchase 73.0%Malyshka Project 57.9%

RENTAL YIELD COMPARISONS

Estimated Weekly Rental $405.00 Estimate by local Agent

Implied Annual Rental $21,060.00 Yield on Retail Purchase 5.0% Based on Estimate Market ValueYield on Cost (Malyshka Project) 5.9% Based on Malyshka Project Purchase Price

Estimated Current Mortgage Rate 5.60%

Weekly Interest Cost $349.90 25 Year (P&I) Principal and Interest loanWeekly Interest Cost $263.55 25 Year (IO) Interest OnlyAnnual Interest Cost (P&I) $18,194.82 Annual Interest Cost (IO) $13,704.65 Cash Flow on Gross Rental (P&I) $2,865.18 Cash $ow positiveCash Flow on Gross Rental (IO) $7,355.35 Cash $ow positive

INTEREST SAVING COMPARISON

Estimate Annual Interest on Retail Purchase

$24,123.61 P&I over 25 years on “Ordinary Purchase Implied Loan”

Estimated Annual Interest on Malyshka Project

$18,194.82 P&I over 25 years on “Malyshka Project Implied Loan”

Implied Interest Saving per annum $5,928.79

Estimate Annual Interest on Retail Purchase

$18,170.32 IO over 25 years on “Ordinary Purchase Implied Loan”

Estimated Annual Interest of Malyshka Project

$13,704.65 IO over 25 years on “Malyshka Project Implied Loan”

Implied Interest Saving per annum $4,465.67

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www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

6. Summary

Market Estimations Summary

Valuations received today have a lot more meaning than those that were sworn prior to the GFC.

The price list is based the price list on real market feedback from local agents and by viewing surrounding stock ourselves. The feedback we have had on our price list is that it is very competitive and conservative.

There are surrounding older townhouses of inferior quality to the ones we are creating that are selling for around the same price.. We have positioned our product very competitively so that investors could sell out quickly if they wished – although Malyshka would recommend holding for 18+ months for additional capital growth.

In this day-and-age it is not hard for an investor to understand a local market with the advent of the real estate search companies online.

We are very con!dent in our price list and encourage investors to click away to discover for themselves real value in the product they will be creating.

Some of observations Malyshka would like to draw to your attention around Design and Utility:

Based upon our inspection and information provided, the following observations have been made with respect to the proposed presentation, condition and functional utility of the development.

The designs of the subject dwellings are to be simple, modern and with limited wasted space;The living/dining rooms are to open onto the rear patio, making use of the available natural light $ows;All 8 of the dwellings are to be 3 bedroom, 2 bathroom;All dwellings will be two story dwellings;

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Disclaimer

This Executive Summary (ES) is dated 10th April 2013 and has been prepared by Malyshka Pty Ltd (the “Developer”)

This ES is not a Prospectus. This ES is solely for the information of the receiving parties (Recipients) to assist them in evaluating this particular project and deciding whether they are su%ciently interested in the opportunity o#ered to proceed with further investigation of the project. The information doesn’t not constitute all or any part of any o#er and contract of sale, and is intended as a guide only.

Property development is speculative. There are risks associated with property development. The author of this ES provides no guarantee with respect to return of capital invested, or future value of the completed dwellings.

The information contained in the document has been prepared by the Developer and Recipients should take note that any !nancial statements contained in the report are based on !gures provided to the Developer by outside sources not limited to the vendors, or the various suppliers, and may not been independently veri!ed by the Developer. Any projections contained in the document therefore represent best estimates only and may be based on assumptions, which, while reasonable, may not be correct.

If a projection has been made in respect of income, such a projection is an estimate and represents only one possible result depending on the assumption made as to the manner in which the rent levels are achieved and other negotiations undertaken.

Recipients should not rely on material contained in this document as a statement or representation of fact, but should satisfy themselves as to correctness by such independent investigation as they or their legal or !nancial advisor sees !t.

Further Malyshka Pty Ltd does not hold an Australia Financial Services License and does not purport to o#er or provide !nancial advice. The information contained within this document/and or email and any attached !les or related media does not constitute speci!c !nancial, accounting, tax, legal or other similar type advice. Malyshka strongly recommend that you liaise with your own !nancial, legal, accounting and other advisers to ensure the concepts contained herein can be tailored to your speci!c needs.

No liability for negligence or otherwise is assumed by the Developer or the vendor for the material contained in the report. Any liability on the part of the Developer, their servants or agents for damages for any claim arising out of or in connection with the document, other than liability, which is totally excluded by this clause, shall not (whether or not such liability results from or involves negligence) exceed $1.00.

This document is provided to the recipient on a con!dential basis and is not to be re-supplied to any other person without prior written consent by the Developer.

To the extent that any of the above paragraphs may be construed as being in contravention of any law of the State of the Commonwealth, such paragraphs shall be read down, or severed or both, as the case may require, and remaining paragraphs shall continue to have full force and e#ect.

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www.malyshka.com.au

PO Box 497 KINGSCOTE SA 5223 AUSTRALIAPh: +61 419 846 799 | ACN: 153 191 710

GST

The Developer advises that the !nancial information in this report relating to income, outgoings and the like is provided without reference to the possible impact of GST, if any. Recipients should make their own assessment of the impact of GST on the investments and the returns derived there from after obtaining expert professional advice.

Con!dential Information

This ES is the con!dential information of the Developer; is strictly for the intended recipient and must not be disclosed to any other party without the prior written consent of the Developer.

By receipt of tis ES, the Recipient agrees that it will not transmit, reproduce or make available (or any information contained within) to anyone other than its professional advisors, without the prior written consent of the Developer. Any such disclosure to the advisor of the recipient must be on a con!dential basis, for the purpose of assessing the information contained in it as advisor to the Recipient.

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