Colorado Real Estate & Investment Co. Company Update May 2008 Colorado Real Estate & Investment Co. 2007: Continued Focus on Occupancy CREICO Occupancy Trend 2003 Net Occupancy Loss of 109 (-1.9%) 2004 Net Occupancy Loss of 40 (-0.7%) 2005 Net Occupancy Gain of 10 (+0.2%) 2006 Net Occupancy Gain of 60 (+0.9%) 2007 Net Occupancy Gain of 30 (+0.6%) Pelican 237 loans - $7.21 million 321 sales including Pelican, cash deals, and COH sales Colorado Real Estate & Investment Co. Top Ten Accomplishments of 2007 – Part I 1. Increased Net Operating Income by 9% or almost $800,000 2. Increased Net Economic Occupancy from 80% to 81% portfolio wide a. Net Economic Occupancy in the Rock Springs, Wyoming properties alone increased by 27%!!! 3. Rehabilitated the town of Farson, Wyoming, and began redevelopment 4. Acquired and took over four properties in Colorado, New Mexico and Wyoming 5. Pelican Finance a. Engaged consumer lending expert with over 20 years experience b. Originated 237 loans totaling $7.21 million c. Raised $5.0 million in bank financing d. Raised $3.5 million in new private equity financing Colorado Real Estate & Investment Co. Top Ten Accomplishments of 2007 – Part II 6. Introduced a new generation of community web sites 7. Introduced the CREICO Home Inventory System (CRHIS) to manage the 265 homes held for sale in inventory 8. Developed Discount Reports for Dealers, Abandoned Homes, and Demolished Homes 9. Developed a prototype water cost recovery program in Rock Springs that generated over $11,000 in cost savings at those properties in the 4th quarter of 2007 alone 10. Implemented the “Home Run” Program through which residents can lock in rental rates to fully pay for their homes in seven years and the “Rent-to-Own” Program through which residents can purchase their homes after one year of successful leasing. Colorado Real Estate & Investment Co. The Numbers Colorado Real Estate & Investment Co. Portfolio Net Operating Income (comparable properties only) ($ in millions) $10.0 $9.5 $9.0 $9.0 $8.5 $8.0 $7.7 $7.5 $7.2 $7.1 $6.9 $7.0 $7.0 $6.5 $6.0 $5.5 $5.0 2003 2004 2005 2006 2007 2008 Colorado Real Estate & Investment Co. Distributions ($ in millions) $10.0 $9.6 $9.0 $8.0 $7.0 $6.5 $6.1 $6.0 $5.7 $5.0 $4.8 $4.0 $3.7 $3.0 2003 2004 2005 2006 2007 2008 Colorado Real Estate & Investment Co. Top Ten Goals of 2008 1. Create cash flow budget and monthly cash flow comparison report 2. Market and sell the Nebraska portfolio, Darlington, Woodview and Hi-Land Village 3. Increase NOI by 10% 4. Increase economic occupancy from 76% to 83% 5. Develop fully the CRHIS program including web-based inventory 6. Establish a viable home financing relationship with 21st Mortgage 7. Fix interest rate on $7.5 million of credit with Pelican 8. Refinance Valley Ridge, Skyline, Kingswood, Windgate and Dream Island mortgages 9. Launch multi-media advertising campaign 10. Develop RV park in Farson and redevelop Foothills Colorado Real Estate & Investment Co. Summary Our Mission 2007 was, in many ways, a great year. – Acquire 700 new home site – Sell Darlington Place – Secure one new fee management account – Increase CREICO portfolio NOI by 10% – Achieve 82% NEO on portfolio – Redevelop Farson, Wyoming – Redevelop at least 100 home sites at Foothills – Originate 300 loans and an annual loan volume of $6.0 million – Find one or more alternative sources of capital for Pelican – Complete new AutoRIF and move-out RIF with security deposit programs and develop CRHIS home inventory program Colorado Real Estate & Investment Co. Summary In 2007, we also expanded the areas of retail sales and financing, and construction and property management We experienced tremendous growth and success in Wyoming, as we expected when we originally began the redevelopment and acquisition projects there in 2004 Most of the remainder of the properties turned in solid and stable performance There is a saying, however, that nothing worth doing is ever easy A few areas of our business became more difficult in 2007 particularly home sales and financing in Texas Nevertheless, we as a team have risen to the challenge and have persevered. The challenges have caused us to improve We believe you, our team of dedicated professionals, are the best in the business We enjoy tremendous financial strength because the hard work and dedication of the Vukovich family and of those who have come before us to build a portfolio of 47 properties valued at over $175 million Finally, the portfolio is large and geographically diversified so that when one region struggles, the rest of the portfolio balances out the overall performance Colorado Real Estate & Investment Co. Summary 2008 holds great promise. – The Wyoming properties continue to generate tremendous results – The remaining redevelopment projects are drawing increasingly favorable attention and demand – We believe we have overcome the difficulties and challenges in Texas and have stabilized key areas on which we can build the future success. – The rest of the regions in the portfolio are continuing to deliver solid and stable results Nothing worth doing is ever easy. We all have much to celebrate about 2007 and the future. We also have a number of challenges and opportunities ahead of us to work out. We are confident that together we will fulfill Our Mission! Colorado Real Estate & Investment Co. Company Update May 2008 ONWARD AND UPWARD!
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