1. +
SBpacific
group
East Lake Laney Lofts, Oakland Portofino, San Antonio
Portofino, San Antonio City View Apartment, San
Antonio
9/25/12

2. +
About SBpacific Group
 Our History
 SB Pacific Group acquires under-utilized properties
and transforms them into vibrant, high-value real
estate assets
 Located in Berkeley, California
 Founded in 1986
 Experience
 Focus on value-add infill development
 Handles large luxury redevelopment
Lake Merritt Lodge, Oakland
9/25/12

3. +
Investment Philosophy
Geographic  Texas and California
Specialization  High density suburban property
Management  Supervise construction and
Expertise rehabilitation projects
 Superior network of contacts
Fundamental Value-
Driven Approach  Class B- to B+ or B renovations
 Rehabilitation, repositioning, and
adaptive re-use
9/25/12

4. +
Acquisition Criteria
 Property Types
 Multifamily rental
 Retail & Office
 Market Segment
 Opportunistic value-add
Lodge on Perrin Creek, San Antonio
 Up-trending submarket ($5-
$20 million)
 Near-term growth focus in
California and Texas
9/25/12

5. +
Recent Projects
San Antonio Apartment Portfolio East Lake Laney Lofts City View Apartments
San Antonio, TX Oakland, CA San Antonio, TX
San Antonio Apartment East Lake Laney City View Apartments
Portfolio Lofts
- 318 units re-branded
- 211 units bought with -Renovated creamery to City View
65% occupancy to 26 Class A Condos - Rent increase and
- Rent increase still own
- Full rehabilitation to - All units sold within
1 month of finish
- Full rehabilitation to
95% occupancy 96% occupancy
9/25/12

6. The Offering
Price: $11,500,000
Built: 1970
Price Per Unit: $42,279
Price Per Sq Foot: $50.86
Units: 272
GBA: 226,104
Land Area: +/- 10 acres
9/25/12

7. Location Profile
+
South Texas Medical
Center
San Antonio and the Surroundings…
 San Antonio is the 7th largest city in the U.S with a population of 2.08 million
 Portofino is near the South Texas Medical Center which includes 45 medical institutions and
over 28k professionals. Associated support businesses employ 23k. The average wage is
20% higher than the median San Antonio income.
 Portofino is a walking distance to USAA, a San Antonio based diversified financial services
group. Over 18,000 employees occupy the corporate headquarters at the corner of
Fredericksburg and Huebner.
9/25/12

8. + Location Profile
Strategic Access
 Advantageously located within five
minutes to two of San Antonio’s largest
employment centers
 Short drive to San Antonio’s largest
university, new retail centers, and state
of the art entertainment
Flourishing Employment
 USAA, South Texas Medical Center, and
the University of Texas at San Antonio in
immediate submarket
 Adjacent to Fredericksburg Road and a
short distance to Interstate Highway 10
and Loop 410
9/25/12

9. + Location Profile
9/25/12

10. +
Apartment Unit Amenities
Indoor Amenities
 272 Unit Garden Apartments in northwest submarket
 Central HVAC & washer/dryer connections in select
units
 Large walk-in closets and storage
 Fitness center and two clothes care facilities
 Select units have remodeled kitchen and bath
Outdoor Amenities
 Two swimming pools
 Gated entry w/ picnic area and barbeque stations
 Lush native landscaping with magnificent oak
trees, limestone garden walls, and courtyards
 Professional leasing center
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11. Apartment Unit Breakdown
Units Type Unit SF Total SF
56 1 Bed / 1 Bath 525 29,400
68 1 Bed / 1 Bath 705 47,940
80 2 Bed / 2 Bath 905 72,400
40 2 Bed / 2 Bath 1,032 41,280
28 3 Bed / 2 Bath 1,253 35,084
272 831 226,104
9/24/12

12. +Apartment Comparable
Apartment Complex # of Units Avg. Size (SF) Avg. Market Rent Rent per sq.foot
Arroyo Ranch 277 968 $802 $0.83
Bent Tree 272 693 $693 $1.00
County View 272 784 $744 $0.95
Limestone 324 764 $639 $0.84
Mesa Ridge 200 784 $694 $0.94
Portofino 272 833 $651 $0.78
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13. +
Rent Comparable
9/25/12

14. Why Purchase Montage at
North Point?
Attractive Occupancy
Discount  Current economic occupancy is 76% and
present physical occupancy is 92% our
target physical range is 98%
 Increase occupancy and maximize
collections boosting revenue
Occupancy Value-Add Well Located Asset
 Ability to attain asset directly from lender
with asset management upside (Off
Market Opportunity)
9/25/12

15. Value-Add Opportunities
Exterior Additions
 Landscape trimming & sprinklers
 Painting a portion of the building
 Recoat and restripe the driveway
Interior Upgrades
 Replace carpet with Prego
 Replace kitchen laminate countertops
with granite
 Two-tone painting
Timing
 Ideal due to expansion of South Texas
Medical Center
 Historically low interest rate & depressed
price
9/24/12

16. +
Expected Development Results
2011-2012 Pro Forma 3rd Year
Gross Scheduled Rent 2,116,896 2,263,956
Vacancy and Collection Loss 692,356 387,801
Net Rental Income 1,424,540 1,876,155
Other Income 119,213 212,386
Economic Occupancy 67% 83%
Physical Occupancy 90% 93%
Total Income 1,543,753 2,088,541
Total Expenses 1,362,157 1,255,231
Net Operating Income 181,596 833,310
General Notes
 Current Occupancy 90%, Stabilized 88% / Water reimbursement through Conservancy
 Expenses based on City View Performance
9/25/12

17. +
Purchase Price Analysis
Actual 3rd Yr Proforma
Purchase Price 11,500,000
Down payment 3,248,775
NOI 181,597 833,310
Mortgage Payment 330,938
6.9MM 5.6% 30-yr due in 7 years)
Net Cash Flow 181,597 502,372
Return $ on $ 15.46%
General Assumptions
 Assumes 75% Loan to Value
 Total Cash Down payment includes 1% loan fee, insurance, legal fees, title & escrow, and
capital reserve
9/25/12

18. + Net Cash Flow & IRR
Scenarios IRR 2011 2012 2013 2014 2015 (Sale) Cap
Rate
1 27.62% -2,935,901 396.770 427,017 493,904 5,587,465 5.75%
2 27.21% -2,935,901 396.770 427,017 493,904 4,573,108 6.25%
3 24.79% -2,935,901 396.770 427,017 493,904 3,709,026 6.75%
3,323,275 7.00%
4 22.40%
-2,935,901 396.770 427,017 493,904
30.00% 27.62% 27.21%
24.79%
25.00% 22.40%
20.00%
IRR
15.00%
Cap Rate
10.00%
6.25% 6.75% 7.00%
5.75%
5.00%
0.00%
IRR1 IRR2 IRR3 IRR4
9/24/12

19. Our Market View
Key Advantages
Cheap Financing
 3.75% in Pro forma Model
Attractive Market
 +10% Cash on Cash Return
 Up-trending submarket
 Property enhancements can push
rents higher
Lodge on Perrin Creek, San Antonio
9/25/12

20. +
Projected Fees
Management Structure Fee
 General Management receives an acquisition fee of .75% for
sourcing, seeding, negotiating, and closing opportunity.
 Asset and Management Fee is 5%
 Investors and general management will split the annual net cash flow 85/15 as long as
investors receive 6% annual return on their investment.
 At closing, Investors and General Management will split all proceeds 80/20 after meeting all
obligations including but not limited to debt service and closing costs.
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21. +
Experienced Team of Professionals
Igal Sarfaty Yuval Bobrovitch
Principal & Co-founder Principal & Co-founder
Responsible for strategic Responsible for oversight of
management of the firm, Mr. construction projects, Mr.
Sarfaty identifies, evaluates and Bobrovitch is involved in site
selects investment opportunities analysis, design development
for SB Pacific Group. Prior to and construction management.
founding SB Pacific Group, Mr. Mr. Bobrovitch has extensive
Sarfaty used his entrepreneurial experience in the construction
skills to establish several small and renovation of multifamily
companies, including a residential and commercial
contracting business which he properties. He is a general
continues to operate today. contractor, and supervised all of
the early projects in the SB
He has held a real estate license since 1989.His experience Pacific Group Portfolio. Through his diligence, Mr.
as a contractor and his eye for opportunity have helped Mr. Bobrovitch sets the standard by which the full upside
Sarfaty negotiate lucrative real estate transactions that potential of properties should be reached.
create lasting value.
9/25/12