Executive Summary Template EXECUTIVE SUMMARY

							                                          EXECUTIVE SUMMARY

   Subject Property|                          FINANCING REQUEST| To finance construction of subject
   The Villagio at Austin                     property. The borrower requests competitive development debt financing.
   SH-620
   Austin, TX                                 PROPERTY DESCRIPTION |
   Loan Type| Construction                    Physical: SH-620 North near Anderson Mill Rd.
   Loan Purpose| Ground-up                    Legal:
   Property Type| Mixed-Use                   Zoning: Not Applicable
   As-Is Value|$10,000,000                    Unit Mix: 288 apartment units/ 6 restaurants / Office/Retail
   As-Completed Value|$118,451,540            NRSF: Retail/Office – 150,000 Multifamily - 311,000
   Price Per SF|$257                          Avg SF: 900 sf per apartments
   Total Dev Costs|$91,603,425                Lot Size: 30 Acres
   Loan Requested| $72,800,000                # of Bldgs: Retail – 10 Office - 2 Multifamily - 2
   LTC| 80%                                   Frontage: 49,240 sf
   Pro Forma NOI|                             Utilities: Municipality – City of Austin
   $3,994,350 Apartment
   $4,275,000 Retail/Office                   # of Parking Spaces/Parking Ratio:
                                              Surface Parking @ 420
   Principal Cash Contribution|               Structured Parking @ 750
   $18,803,425                                Total Parking @ 1170
                                              Apartment Ratio 1.66/unit
   Principal Borrower(s)|                     Commercial/Retail – 3.5/1,000sf
   The Marcel Group                           Restaurants – 10/1,000sf
   P.O. Box 9556
   The Woodlands, Texas 77387                 Amenities: Structured parking, lush landscaping, natural park/lake
   www.marcelinc.com                          settings, etc.
   PRIMARY CONTACT
   Antonio Marquez
   amarquez@quezcapital.com
   619.955.7665

PROPERTY BACKGROUND |

Background: The Villagio is a Class-A mixed-use development in Austin near Lake Travis and Anderson Mill Rd. The
property serves to satisfy pent up retail and apartment demand in the vibrant and bustling community. The Villagio will
contain apartment for upper income A-credit tenants as well as retail and office uses throughout the property. In
addition, the property will have natural park settings and a lake on premises. Absorption and demand has been strong in
Austin for the intended uses of this project.

Tenant profile: Regional credit tenants for retail/office. Upper income, strong credit apartment tenants.



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Recent Occurrences: Recent multifamily density bonuses have provided favorable approvals in addition to a more
attractive return profile on the Villagio at Austin project.

Existing Debt : Land acquisition per option contract to take place before December of 2007 in the amount of
$6,500,000 plus soft costs.

Leasing Management: Retail leasing will be performed by the Marcel Group’s in-house leasing team.
www.marcelinc.com. Third-party management will be provided for multifamily component.

Entitlement Status: Fully entitled
Total Development Cost: $91,603,425
As-Completed Value: $118,451,540
LTC: 80%
Absorption Period: 8-10 months
Expected Stabilization: 30 months
As-Completed LTV: 60%

_________________________________________________________
MARKET/SUBMARKET CHARACTERISTICS|
Economic Growth

Economic Market Report: http://recenter.tamu.edu/mreports/AustinRRock.pdf

Real Estate News-Austin/RoundRock: http://recenter.tamu.edu/mnews/mnsearch.asp?AID=3&TID=&STX=

Austin Economic Profile: http://www.austin-chamber.org/DoBusiness/GreaterAustinProfile/index.html

Workforce Data: http://www.austin-chamber.org/DoBusiness/GreaterAustinProfile/workforce.html

City/County Plan: http://www.austin-chamber.org/DoBusiness/AboutOpportunityAustin/About.html

Nearby Developments (complementary growth ie retail, office): http://www.globest.com/cgi-
bin/texis/scripts/globest-search/search.html?query=austin%2C+tx

Historical/Current Occupancy: 95% for both residential and retail.
Rental rate trend: 5% per annum
Units in Inventory: N/A
Building Permits: http://recenter.tamu.edu/data/bpgis/Austin.html

PRINCIPAL(S)|

Borrowing Entity (SPE): To form separate entity with borrowers and equity investors.
Guarantor(s): Compass Cos., Marcel Construction & Maintenance, Charles & Vernon Veldekens
Background: Real Estate Development
Track Record: Multiple retail developments throughout Texas. www.marcelinc.com
Credit Score: 800+
Net Worth: $20MM+
Cash into Deal: $18,803,425




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SOURCES & USES

Source Schedule
Senior Debt                                       $72,800,000
Subordinated Debt: Seller Financing                  N/A
Subordinated Financing: Mezzanine                    N/A
Cash Contribution                                 $18,803,425
Imputed Equity                                       N/A

Use of Loan Proceeds: Land acquisition and ground-up development of The Villagio Project.

Use Schedule
Land Acquisition                                   $6,500,000
Soft Costs – Expenses/Developer Fee               $18,183,425
Interest Reserves                                  $5,750,000
Development Costs - Hard                          $61,170,000


LOCATION |

Reference:
http://maps.google.com/maps?f=q&hl=en&q=FM-
620+N,+Austin,+Travis,+Texas,+United+States&sll=30.577632,-
97.45697&sspn=0.55569,1.2854&ie=UTF8&cd=3&geocode=0,30.391040,-97.887520&ll=30.419664,-
97.851791&spn=0.139149,0.32135&z=12&om=1

EXIT STRATEGY|

Estimated date of repayment: Spring 2010.

Financial Exit Strategy: Permanent takeout of construction financing subsequent to stabilization to take place 30
months from construction financing.




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