American Land Fund

Shark Tank: Denver Land Opportunity

Distressed Master Planned Residential Community

Includes: 88 Finished Lots, 99 Partially Finished Lots, 732 “Paper” Lots

Southeast Denver: Parker/Aurora submarkets

American Land Fund

Denver MSA Still Growing Annually

Sustained Denver growth

New Home Permits: The Tide Has Turned

DENVER METRO AREA

• 2010: 5,244 new home permits

• 2011: 6,100 new home permits

• 10 Year Historical Average: 18,098

• Projected Next 10 yrs: 8,400 permits

PARKER/AURORA SUBMARKET

• 2010: 696 new home permits

• 2011: 884 new home permits

• 10 year Historical Average: 2,968

• Projected Next 10 yrs: 1,131 permits

American Land Fund

Denver MSA Regional Map

SITE

American Land Fund

Aurora/Parker Submarket Map

SITE

American Land Fund

Overhead Aerial View

American Land Fund

Site Master Plan

American Land Fund

Master Plan History

Master planned 1,150 unit single family home community “hits the wall” in 2007 after selling over 200 finished lots in less than two years prior to Great Recession.

Buy the debt and “reset” project; 175 occupied homes.

“Face value of Debt” exceeded $50+mm.

‘Broken’ & Fully Improved Master Plan

American Land Fund

Land Acquisition Overview

Extended Deal Courtship: 24 months of pre-acquisition effort to purchase debt from multiple lenders.

Purchased all “first position” Deeds of Trust in May 2011.

Recap & JV w/original developer and ‘friendly lien release.’

Complete foreclosure & secure “clean title” Q4 2011.

Broken Master Plan: Buy The Debt

American Land Fund

Sponsor Overview

American Land Fund owns over 24,000 lots across seven different U.S. states.

Residential land experts: no hidden land mines.

(--E.G. 300 Year water supply fully adjudicated & vested)

Local Partner has delivered 4,500 lots in Denver MSA over past 20 years.

Local Partner is ‘original developer’ and heads the project’s utility District with all public utilities in place.

Strive to “be good” at one thing

American Land Fund

The Opportunity

Patient relationship with original developer allows debt acquisition at very deep discount.

Purchase of debt and foreclosure retires debt at less than 20 cents on the dollar.

Risks of foreclosure or redemption by juniors eliminated.

Immediate Income in first year with deeply discounted finished lots.

Shark Bait: The Opportunity

American Land Fund

Low Cost Basis & Rapid Revenues in first 2 years

Impact fee reductions from steeply discounted Metro District Bond ‘reset and sale’ allows:

15+% finished lot price advantage against other finished lots in submarket just from lower impact fees.

Low acquisition basis further allows ‘lot discounts’ of another 15% total ‘discount to market’ of 30%.

Local Partner has 20+ years with Denver public homebuilders. Several builders want to ‘come back’.

This aids immediate homebuilder lot purchases for immediate return of cash.

Shark Feeding: Why This Deal?

American Land Fund

Strengths

Majority of initial cash returned quickly;

No infrastructure risk; 300 year water rights vested & placed.

Weaknesses

“B location” requires certain type of rural/metro buyer.

Opportunities

Impact fee “$7,500 rebates” accelerates initial lot sales.

Threats

Parker/Aurora both have competing in-fill locations. Shadow inventory of pending foreclosures always a risk.

Strengths / Weaknesses / Opportunities

American Land Fund

Sharks Can Generate Solid Returns

Deal EconomicsNo Inflation W/Inflation

Total Lot Revenues $21,333,765 $25,202,649Net Profit $11,607,984 $15,476,867 Unleveraged Return 24.56% 29.47%Cash On Cash 2.63x 3.16x

Peak Equity Entire Deal $7,124,902 $7,162,052 Peak Equity (Shark) $6,768,656 $6,803,949Peak Equity(Sponsor) $356,245 $358,102

Months to pay back 50% of up front capital < 24 Months Same

Months to pay back 100%of up front capital

< 60 Months Same

Cash Sources Sponsor Financing $312,500Shark Investor $5,937,500 Total Sources $6,250,000

Cash Uses

Land Purchase Price $5,500,000 Soft Cost & Legal Reimbursements $750,000

Total Uses $6,250,000

American Land Fund

Request for Shark Investment Committee:

Seeking 95% equity commitment of $5.93 mm cash.

10% “preferred” return paid on all equity; All equity treated same (“parri passu”). Promote(s) shared on 80 / 20 split.

Zero Development Fees. $150,000 annual management fee.

After first 187 lots are sold, “gross equals net” on final 732 paper lots that are sold off over time.

How the Funding is Deployed

American Land Fund

Question & Answer Session

Contact: www.americanlandfund.comccherney@americanlandfund.comCraig Cherney: (267) 516-7787

Actively managing residential land since 2005.