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Year 15 Panel: Market Overview and Case Studies

Year 15 Panel: Market Overview and Case Studies. All TCG Transactions: Representation of Sales Market. TCG Net Sales Proceeds Since 2010. Buyer Types & Execution Since 2011. Case Study: Plainfield, Indiana | Year 15. Additional Details: 1995 Construction w/ Extended Use Until 2026

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Year 15 Panel: Market Overview and Case Studies

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  1. Year 15 Panel: Market Overview and Case Studies

  2. All TCG Transactions:Representation of Sales Market

  3. TCG Net Sales Proceeds Since 2010

  4. Buyer Types & Execution Since 2011

  5. Case Study:Plainfield, Indiana | Year 15 • Additional Details: • 1995 Construction w/ Extended Use Until 2026 • Growing Submarket, Expanding Employment Base • LIHTC Asking Rents Below A/B Class Market Rate Assets by $100-$150 • Rental Upside on 60% AMI Units After a Moderate Interior Upgrade • New Financing at 3.77% on a 7-Year FNMA Loan at the Time of Closing Buyer Motive:Cash flow buyer looking for A-/C+   multifamily assets to buy for a 7+ year hold with a projected asset-level IRR of 15-18.%. Seller Motive: Replacement GP.  Limited Partner looking to exit as the asset is post its Tax Credit Compliance Period and economic benefits for the Limited Partner are waning.   Favorable interest environment and no prohibitively high pre-payment penalty make it a likely candidate for a disposition.

  6. Case Study: Port St. Lucie, FL | Year 11 • Additional Details: • New 2001 Construction w/ Extended Use Until 2031 • Growing Submarket • Nonrefundable Deposit at Execution of Contract • Closed in 17 Days Buyer Motive: Operational upside as the market continues to recover.   Qualified contract options allows for a re-positioning play post Year 15, i.e. potential conversion to market rate.   Lack of supply on market rate side and an attractive per-unit pricing.   Cash flow opportunity to achieve 15+ IRR on a 5+ year hold strategy. Seller Motive: Favorable multifamily environment in a fast-recovering Florida market.   Seller faced with the decision to do a cash refinance to replace an in-place high interest debt vs. a disposition on a property that is post its tax credit flow period.  Sell prior to a buildup in deferred maintenance items and in a current low interest rate environment.       

  7. Robert Sheppard Executive Director Robert.Sheppard@tcg-mm.com Tax Credit Group of Marcus & Millichap www.tcg-mm.com 206.826.5700

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