StructuresCREATING DEALS THAT PAY

with G CAPITAL GROUP

JOINT VENTUREStructuresCREATING DEALS THAT PAY

G CAPITAL GROUP

INVESTMENT

02.03

WITH THE CURRENT GEO-POLITICAL SENTIMENT,FRANKFURT HAS EVOLVEDAS ONE OF THE MOST STABLEREAL ESTATE MARKETS IN EUROPE. TODAY

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01 G CAPITAL GROUPCOMPANY STRUCTUREINVESTMENT STRATEGY

OVERVIEWLOCATIONDEAL METRICS

CAPITAL PARTNERSPRIVATE EQUITYINSTITUTIONAL DEBTCONVERTIBLE DEBTMEZZANINE LOANS

CONTACT ANDDISCLAIMER

04.05

G CAPITAL GROUP IS A FULL CYCLE REAL-ESTATE DEVELOPER.THE DEVELOPMENTARM HAS BEEN ACTIVEFOR 3 DECADES INTHE FRANKFURT REGION.

G CAPITAL GROUP

INSPIRED BY HISTORYBUILDING FOR FUTURE

G CAPITAL GROUP

DEVELOPMENTMANAGEMENTLEGAL DDCAPITAL STRUCTURING

LEGALS

DEVELOPMENTMANAGEMENT

CAPITALSTRUCTURING

G CAPITAL GROUP

G CAPITAL GROUP

The development arm of G Capital group has a proven trackrecord of over 30 years in the Frankfurt region across multiple projects.The team performs technical feasibility checks, construction cost appraisal and project management.

The Capital Structuring team is respinsible for mergersand acquisitions, deal structuring and investor relations.The team specializes in Lux and German investment vehicles.A separate tailor-made structure is installed by the team foreach project, in line with the interests of all stakeholders.

With the in house legal team, the group is able to performlegal due diligence efficiently.Installation of local SPVs, loanagreements, construction leg--als are performed by the legalteam.

COMPANY STRUCTURE

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INVESTMENTPROJECT FEASIBILITY CHECKShortlisted sites based on initial internal parameters are put through feasibility check. Ground feasibility, technical due diligence and the micro market analysis is carried out.

G Capital usually enters into projects where the zoning is in pl-ace and total built up area is already approved. Furtherdevelopment feasibility is checked with local architects andengineers. Similar completed projects are used as a base to cal-culate construction costs and further Gross DevelopmentVolume.

The in house legal team starts performing due diligence on theasset and vendor. Plots with a long ownership history are pref-erred.

EXIT STRATEGYFor commercial developments, potential tenants are sourced befo-re acquisition of the land. Ideally the target is to have 50% arearented before the acquisition.

For hotel and similar developments, the lease agreements with theoperators are signed before the land acquisiton. Very often the he-ad of terms with a forward buyer is also agreed and a further for-ward purchase agreement signed once planning permit is secured.

For residential developments, either the whole project is sold toone insitutional buyer or, in case of retail sales- marketing, retaildebt partners for buyers are onboarded. Pre sales start after plan-ning permit is secured. Retail exit is only carried out in case of trophy /AAA micro locations.

CAPITAL STRUCTURINGDetailed dynamic cash flows are planned. Investor outputs,return calculations are carried out. G Capital starts communi-cating with potential equity and debt capital partners.

Based on the project, the deal can be structured either as ahighly leveraged whole loan or a hybrid of senior loan + equity+ mezzanine loan. The deployment plan, tax structuring, oper-ation cashflows are performed before the acquisiton of the plot.

FRANKFURT

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STRATEGY1.

2.

3.

LOCATIONFINANCIALS ANDRISKS ARE THE KEY METRICS DECIDING PROJECT FEASIBILITY

OVERVIEW

Edinburgh

Dublin

London

Madrid Barcelona

Paris

Luxemburg

Frankfurt

Berlin

Zürich

Mailand

Rom

Wien

Warschau

OsloStockholm

1 Std.

2 Std.

CENTRAL LOCATION IN GERMANY AND EUROPE

International air traffic hub with more than 61 million passengers a year and important global links.

Ideal transport connections via the A3, A5, A66, A648 and A661 motorways and the national and international railway network.

Central station one of europe's largest and most important hubs with over 350.000 travellers per working day.

Population of 40 million within a 200 km radius.

LOCATION

Hamburg

Berlin

Dresden

München

Stuttgart

Zürich

Paris

Brüssel

Köln

Düsseldorf

FRANKFURT AM MAIN

TRAVEL TIME

BAB (A3/A5/A66) 5-10 Min.

Flughafen FFM 15 Min.

Frankreich 2:00 hr.

Luxemburg 2:30 hr.

Schweiz 3:00 hr.

Österreich 4:30 hr.

Köln 1:15 hr.

Stuttgart 1:30 hr.

Brüssel 3:05 hr.

Paris 3:50 hr.

Hamburg 3:40 hr

Berlin 4:10 hr.

Brüssel 1:00 hr.

Hamburg 1:05 hr.

München 1:00 hr.

Berlin 1:10 hr.

Paris 1:15 hr.

London 1:30 hr.

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MACRO

LOCA

TION

KEY FINANCIAL INDICATORS Profit on GDV > 30%

80-85%65-70%

>15%/ <3,5%

Construction debt Acquisition debt IRR / WACC

MAJOR RISKS IN A DEVELOPMENT PROJECT

Planning RiskIn an unplanned site, there is a risk of less lettable area achieved and higherconstruction costs based on final design.

Credit RiskAlthough the senior debt is secured against the land, the debt along with theaccrued interest is supposed to be paid on the exit. Therefore the exit riskdirectly drives the credit risk.

Exit RiskIn a volatile market, the exit can be delayed or may not meet the projections.The equity investors’ returns are at risk if such an event occurs.

Construction RiskDelays in construction affect the cashflows of the project. Handover datesare stringent and in case the site is not delivered on time, there are heavy penalties from the operators/tenants.

Before acquisiton of the site, G Capital onboards an operator and signs alease agreement to enable a exit strategy. An exit is organised during theplanning phase itself and a hard exit is secured once construction permit is received. G Capital has working relationships with 3 international ope-rators looking to expand in Germany therefore the exit risk is offset in theform of the lease agreement and a forwad purchase agreement.

Established general contractors are used with strong contracts to mitigatethe construction risk. G Capital’s development team remains activelyengaged with the general contractors to ensure deliverability.

MITIGATION STRATEGIES UNDERTAKEN

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METRICS

A ROBUSTACCOUNTING DISCIPLINEENSURES A SMOOTH EXIT

PRIVATE EQUITYINSTITUTIONALDEBTCONVERTIBLE DEBTMEZZANINE LOANS

CAPITAL PARTNERS

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INVESTOR OUTPUTS (subject to change)

TERMSClosed End Deals/Open End Deals Return to limited partners 8-13%/14%-18%Investment Horizon 24-40 monthsSecurity Shares of the HoldCo owning the PropCo Deployment on a project by project basis. No blind fund. Binding lease agreements ensure rent security in open end deals

DEPLOYMENT PLAN

KEY CHECKPOINTS

Equity is deployed in 3 tranches (Tranche 1 for acquisition+pla-nning. The further tranches are deployed subject to fulfilment ofcheckpoints set forward in the GP-LP agreement

Planning permit secured Forward purchase agreement signed latest before tranche 3 mobili-sation.

MODE OF INVESTMENT

3EQUITY

PRIV

ATE

On a project by project basis a coupon is issued by G Capital Group for equity investors as limited partners for both Open End and Closed End deals.

CLOSED END DEALS:1. Operator with binding lease agreement in place before land acqui-sition.2. Head of terms with the forward buyer signed before land acquisi-tion and planning.3. Forward purchase agreement in place after acquisiton and plan-ning before construction equity is deployed4. Downpayment from forward buyer on construction permit is favored.

OPEN END DEALS:Operator with lease agreement in place but the exit is secured along the way during the planning phase. G Capital ensures a hard exit is secured at least 12 months before construction completion.

THE EQUITY IS INVESTED INTO

THE HOLDCO DIRECTLY

OWNING THE PROPCO

DEBT INSTRUMENTS

INSTITUTIONAL WHOLE LOANSFirst charge on the land register of the property.

High leveraged whole loans are preferred on low risk projects with either forward funding or hard exits in place.

The interest rate varies between 2.75% - 3.5%.

A whole loan is injected directly at the PropCo level with Loan to Cost between 88%-95% or Loan to Value between 75-82%.

The remaining is common equity invested either by the company or its development partners.

Interest payments are reinvested into the scheme and paid out on the exit along with the principle.

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MEZZANINE DEBT

CONVERTIBLE DEBT

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INSTITUTIONAL/MEZZANINE DEBT

Mezzanine loans are used with a senior bank debt in place. The loans are secured on the land register at the 2nd place after the senior loan.

The company preferes to deploy mezza-nine during the construction phase after exits are in place to manage credit risk

To provide more security to investors during the acquisition and planning phase, a convertible debt note is issued.

The loan is converted into equity at a pre agreed valuation and terms once the construction permit is secured and a hard exit is in place.

All the above mentioned financials are just an indication based on past projects and are subject to further negotiation with investors on a project by project basis

DISCLAIMER

4 YOUR PARTNER FOR FURTHER INFORMATION AND INVESTMENT OPPORTUNTIES

This presentation has been provided for information purposes only and is being circulated on a confidential basis. This presentation shall be used only in accordance with applicable law, e.g. regarding national and international insider dealing rules, and must not be distributed, published or reproduced in whole or in part nor may its contents be disclosed by the recipient to any other person. Receipt of this presentation constitutes an express agreement to be bound by such confidentiality and the other terms set out herein.This presentation includes statements, estimates, opinions and projections with respect to anticipatedfuture performance of the Group ("forward-looking statements"). All forward-looking statements containedin this document and all views expressed and all projections, forecasts or statements relating to expectations regarding future events or the possible future performance of G Capital Group or any corporation affiliated with G Capital Group (the “Group”) only represent the own assessments and interpretation by G Capital Group of information available to it as of the date of this document. They have not been independently verified or assessed and may or may not prove to be correct. Any forward-looking statements may involve significant risks and uncertainties and should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. No representation is made or assurance given that such statements, views, projections or forecasts are correct or that they will be achieved as described. Tables and diagrams may include rounding effects. This presentation is intended to provide a general overview of the Group's business and does not purport to deal with all aspects and details regarding the Group. Accordingly, neither the Group nor any of its directors, officers, employees or advisersnor any other person makes any representation or warranty, express or implied, as to, and accordingly no reliance should be placed on, the accuracy or completeness of the information contained in the presentation or of the views given or implied. Neither the Group nor any of its directors, officers, employees or advisorsnor any other person shall have any liability whatsoever for any errors or omissions or any loss howsoever arising, directly or indirectly, from any use of this information or its contents or otherwise arising in connection therewith. G Capital Group does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this presentation..

CONTACT

Photography courtesy of Unsplash© G Capital Group 2019

4G Capital Group of Companies

Development Management Arm:Jöckel Projektentwicklungs GmbHBerliner Alle 4964295 Darmstadt

Group Chairman:Anubhav GuptaE: anubhav.gupta@g-capital-group.com

www.g-capitalgroup.comwelcome@g-capitalgroup.com