Business Plan for Acquisition Targets

BUSINESS PLAN 2016

PCC Capital Investments LLC, (202) 657-6960 email [email protected] www.pcccapital.com

PCC Capital Investments LLC PCC Capital Investments, LLC (The Company) is in the business of raising private investor capital for the

purpose of, but not limited to, buying discounted, distressed, foreclosed, or bank-owned commercial or

residential real estate projects and other viable investments deemed appropriate by Management in the

United States of America.

The Company uses loans from private investors to acquire and repair or improve the subject property to

market values comparable to other nearby properties. Depending on the specific target property, The

Company may re-sell the improved property, or place it in its portfolio for income generation. The

investor is secured with a Note and a Mortgage or Deed of Trust (whichever is specific to the state)

against the target property, with a 6.5% per annum simple interest yield, OR 15% of the profit generated

by the re-sale of the improved property, whichever is greater. The investor’s funds are borrowed on a

60-month maturity, with zero payments with all interest and principal due on the 365th day from the

Note, or when the property sells, whichever comes first.

The Company’s Managing Director is Michael J. Weiner, who also owns PreConstruction Catalysts, Inc, a

funding advisor for international infrastructure projects. PCC Capital Investments puts together

residential real estate deals with calculated profit potential meeting its criteria. Mr. Weiner has

aggregated numerous experts in the acquisition, funding, portfolio management and asset resales who

stand at the ready to provide expertise where needed in the prudent evaluation and investment of

opportunities that are presented to PCC.

INVESTOR PRINCIPAL PROTECTOR

To protect the investment capital of the Note holders of this offering, PCC Capital Investments, LLC has

retained BSEP Plus Capital Group and its proprietary BSEP+ Principal Protector™. The BSEP+ Principal

Protector™ provides the investors with principal protection via their pro-rata beneficial interest in a

certain key man life insurance policy and guaranteed index annuities which produce relatively high

yields, minimum assured earnings and downside protection thereby resulting in above market returns.

In addition, there is a compounding affect, which typically results, depending on certain variables, in a

complete regeneration of the invested capital between approximately the 9th and 10th years following

the original investment regardless of how the Company performs.

MISSION

mailto:[email protected]

http://www.pcccapital.com/

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The Company is focused creating real returns on our Investor’s money, acquiring opportunistic real

estate at a steep discount by making all-cash offers with its cash resources, and renovating,

rehabilitating or repositioning the acquired assets to achieve their highest use potential for resale or for

holding within a portfolio. We will focus on commercial and residential opportunities located in markets

with upside potential for the targeted property. The Company will be asset-class-agnostic, meaning that

opportunities for acquisition, renovation, management and disposition may be within a certain class,

e.g. Multi-Family Housing, Commercial Office Space, Retail shopping centers, Self-Storage or a myriad of

other real estate classes which may satisfy investment criteria. Other asset classes which present

themselves may be considered where they fit the Company’s acquisition and/or funding strategy.

PROCESS

For a successful acquisition at its lowest possible price, cash offers command greater attention rather

than those made by private investors who then need to find a lender in order to close. The Company has

established a specific step-by-step system which first requires funding, only then to be in a position to

strike at an opportunity with cash in hand. The moment the property has been secured, a promissory

Note and a Deed of Trust or Mortgage is issued to the investor to provide security.

Once a cash offer has been made and accepted by the seller, an inspection is made by a highly

experienced specialty contractor with whom the Company has developed relationships. The budget for

necessary repairs and improvements will be added to the acquisition cost, and then a market

comparison will be made by at least two real estate brokerages and professional broker opinions with

whom we have developed a relationship. That will give us the expected range of profit to be made at

the time of resale. Upon resale and closing, the investor’s money and interest due, or 15% of the

profit—whichever is greater—will be returned to the investor. The investor will then have the option of

repeating the investment in the next opportunity.

MANAGEMENT

Michael Weiner is 60 years old, lives in Olney, Maryland with his wife of 33 years and 3 grown children.

He has previously held Maryland Real Estate Agent licenses, Mortgage Originators License, and

Insurance agent licenses. He holds a Master’s in Business Administration specializing in marketing, and

has a long history of business ownership, including 40 years in the marketing, advertising and business

development arena, with the last 8 years facilitating very large infrastructure and humanitarian projects

worldwide under PreConstruction Catalysts, Inc. He is also appointed as an Investment Advisor to the



BUSINESS PLAN 2016


Governor Inspector General of the International Organization for Economic Development (IOED), a

United Nations activity. In addition to his project funding work, he is now focusing on the residential

buy, fix, and flip market in Maryland, DC and Northern Virginia.

INVESTOR SECURITY

Funds invested are wired to an approved Settlement Company to be held in escrow until the property

has been identified. Once the property is identified, the formal Promissory Note and Deed of Trust or

Mortgage will be issued to the investor, secured by the target property. The Company will not touch

funds until the target property has been identified, negotiated, and placed under contract with a cash

offer. The investor funds will be used for the acquisition and rehabilitation costs, along with expected

seller closing costs to the resale buyer.

The Company, as reflected in the Promissory Note, will pay to the investor a return of 6.5% per annum,

OR 15% of the profit from the resale of the subject property, whichever is greater. The funds will be

disbursed at closing by the Settlement Company. As added security, the notes will be supported by

acquired assets as part of an investment pool. The pool is expected to rotate assets in and out of the

company as they are acquired and then re-sold. In the event of a “buy and hold” investment, those

notes would also be securitized by the property(s).

COMPETITION

There are many real estate investors looking for similar deals all the time. This is why we are expecting

to successfully bid on 10% or less than the properties we target. In order to accomplish our 2 to 4

property per quarter acquisition and rehab goals, we will need to make 20 to 40 offers each month.

Cultivating relationships with active Commercial and Residential Realtors, Property Owners, Attorneys,

Accountants and other sources of investors who are open to joint venturing on their deals, wholesalers

and bank REO departments with property they need to unload from their balance sheets, and others will

allow for that kind of “offering volume”.

Where we believe we will be different is because prior to making offers, we will have Investor cash in-

hand, allowing us to make an offer. Most real estate investors find the property first, then have to go

looking for a lender/investor to back them. This makes an all-cash offer that is accompanied by proof of

funds and promises a ready settlement, subject to the General Contractor’s evaluation and cost



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estimates for repair, more desirable than another offer which is subject to financing. Moving fast when a

deal is uncovered can only be accomplished when the money is ready to make the purchase.

A discussion of targeted asset classes in a sampling of markets within the United States is within EXHIBIT

A.

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EXHIBIT A

EXECUTIVE SUMMARY PCC Capital Investments LLC is located in the Washington, DC- Baltimore, MD region. The asset classes

we will be targeting will include these two excellent markets, and will expand outward across the United

States and Canada.

About Baltimore MD

Once a predominantly industrial town, with an economic base focused on steel processing, shipping,

auto manufacturing, and transportation, the city experienced deindustrialization which cost residents

tens of thousands of low-skill, high-wage jobs. The city now relies on a low-wage service economy,

which accounts for 90% of jobs in the city. The city is home to the Johns Hopkins Hospital. Other large

companies in Baltimore include Under Armour, Cordish Company, Legg Mason, McCormick & Company,

T. Rowe Price, and Royal Farms. A sugar refinery owned by American Sugar Refining is one of Baltimore’s

cultural icons. Nonprofits based in Baltimore include Lutheran Services in America and Catholic Relief

Services.

About Washington DC

Washington has a growing, diversified economy with an increasing percentage of professional and

business service jobs. The gross product of the Washington Metropolitan Area makes it the fourth-

largest metropolitan economy in the United States. The federal government accounted for about 29% of

the jobs in Washington, D.C. This is thought to immunize Washington to national economic downturns

because the federal government continues operations even during recessions. Many organizations such

as law firms, independent contractors (both defense and civilian), non-profit organizations, lobbying

firms, trade unions, industry trade groups, and professional associations have their headquarters in or

near D.C. to be close to the federal government. Tourism is Washington’s second largest industry.

Approximately 18.9 million visitors contributes to the local economy every year. The District also hosts

nearly 200 foreign embassies and international organizations such as the World Bank, the International

Monetary Fund (IMF), the Organization of American States, the Inter-American Development Bank, and

the Pan American Health Organization. The District has growing industries not directly related to

government, especially in the areas of education, finance, public policy, and scientific research.

Georgetown University, George Washington University, Washington Hospital Center, Children’s National

Medical Center and Howard University are the top five non-government-related employers in the city.

Four of the largest 500 companies in the country are also headquartered in the District.

About New York

New York is a global hub of international business and commerce and is one of three “command

centers” for the world economy (along with London and Tokyo). The city is a major center for banking

and finance, retailing, world trade, transportation, tourism, real estate, new media as well as traditional



BUSINESS PLAN 2016


media, advertising, legal services, accountancy, insurance, theatre, fashion, and the arts in the United

States. New York City has been ranked first among 120 cities across the globe in attracting capital,

business, and tourists. Many major corporations are headquartered in New York City, including 45

Fortune 500 companies. New York is also unique among American cities for its large number of foreign

corporations. One out of ten private sector jobs in the city is with a foreign company.

About Philadelphia PA

Philadelphia is the center of economic activity in Pennsylvania. According to the Bureau of Economic

Analysis, the Philadelphia area is the seventh-largest metropolitan economy in the United States.

Philadelphia ranks ninth among world cities and fourth in the nation. The city is also the nation’s fourth-

largest consumer media market. The city is home to the Philadelphia Stock Exchange and several

Fortune 500 companies. Philadelphia’s economic sectors include information technology,

manufacturing, oil refining, food processing, health care and biotechnology, tourism and financial

services. Philadelphia has shifted to an information technology and service-based economy. Financial

activities account for the largest sector of the metro economy, and it is one of the largest health

education and research centers in the United States.

About Atlanta GA

The Atlanta metropolitan area is the eighth-largest economy in the country and 17th-largest in the

world. Corporate operations comprise a large portion of the Atlanta’s economy, with the city serving as

the regional, national, or global headquarters for many corporations. Atlanta contains the country’s

third largest concentration of Fortune 500 companies, and the city is the global headquarters of

corporations such as The Coca-Cola Company, The Home Depot, Delta Air Lines, AT&T Mobility, UPS,

and Newell-Rubbermaid. Over 75 percent of Fortune 1000 companies conduct business operations in

the Atlanta metropolitan area, and the region hosts offices of about 1,250 multinational corporations.

Many corporations are drawn to Atlanta on account of the city’s educated workforce; nearly 43% of

adults in the city of Atlanta have college degrees, compared to 27% in the nation as a whole and 41% in

Boston. Delta Air Lines, the city’s largest employer and the metro area’s third largest, operates the

world’s largest airline hub at Hartsfield-Jackson Atlanta International Airport and has helped make

Hartsfield-Jackson the world’s busiest airport, both in terms of passenger traffic and aircraft operations.

Media is also an important aspect of Atlanta’s economy. The city is a major cable television

programming center. Information technology, an economic sector that includes publishing, software

development, entertainment and data processing has, garnered a larger percentage of Atlanta’s

economic output. Indeed, Atlanta contains the fourth-largest concentration of information technology

jobs in the United States.

About San Diego CA

The largest sectors of San Diego’s economy are defense/military, tourism, international trade, and

research/manufacturing, respectively. The economy of San Diego is influenced by its deepwater port,



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which includes the only major submarine and shipbuilding yards on the West Coast. Several major

national defense contractors were started and are headquartered in San Diego, including General

Atomics, Cubic, and NASSCO. San Diego hosts the largest naval fleet in the world: it is home to 53 ships,

over 120 tenant commands, and more than 35,000 sailors, soldiers, Department of Defense civilian

employees and contractors. About 5 percent of all civilian jobs in the county are military-related, and

15,000 businesses in San Diego County rely on Department of Defense contracts.

TARGETED ASSET CLASSES

Hotels

Twenty one percent of surveyed investors recommended hotels as a “buy.” Hotels also got a score of 6.5

in terms of investment conditions, on a scale where 1=poor and 10=excellent.



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Power Centers

Twenty three percent of surveyed investors said this may be a good time to buy power centers. The

property type got a 5.8 on the investment conditions scale. In November, Walgreens Boots announced

plans to acquire Rite Aid, and the $17.2 billion deal would pare the drug store sector to two national

players—Walgreens and CVS. The acquisition will likely have a significant impact on the retail real estate

industry, particularly the net lease sector.



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Student Housing

Student housing continues to look like an attractive opportunity to 25 percent of surveyed investors. It

received a score of 6.1 on the investment conditions scale in the third quarter of 2015. New investors

have piled into the market for student housing properties—driving property prices and the volume of

deals up and driving capitalization rates down. The new student housing buyers include private equity

funds and institutional investors, which are becoming much more likely to bid for student housing

properties.



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The Rise of Micro-Unit Apartments

Micro-units—rental apartments about the size of a hotel room—represent a small but growing niche of

the real estate multi-housing market. These miniscule living units seem ideally suited to young people

who are mobile, come and (mostly) go and live the “18-hour” lifestyle of the modern urban townscape.



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CBD Office

Office buildings in Central Building Districts (CBDs) were rated as a “buy” by 29 percent of surveyed

investors. They got an investment conditions score of 6.2.



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Suburban Office

Thirty nine percent of surveyed investors recommended buying suburban office buildings, which got an

overall rating of 5.0 on the investment conditions scale.



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Neighborhood/Community Centers

Forty six percent of surveyed investors recommended buying neighborhood and community shopping

centers. In the third quarter of 2015, the property type got an investment conditions rating of 6.3.



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Industrial Warehouse

Almost half of surveyed investors—48 percent—reported that they view warehouse properties as a

good “buy” right now. Industrial warehouse properties also got an overall investment conditions rating

of 7.1—the highest of any property type on the list.



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Private Equity Pours Money Into Self-Storage Deals

Investors crowded into self-storage as the sector continues to post the highest long-term returns of any

commercial property type.



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Multifamily Investors Bid in Secondary, Tertiary Markets

Investors are finally buying apartment properties in big numbers in smaller cities and towns. “There’s

been a dramatic increase in the number of offers for properties in secondary and tertiary markets,” says

John Sebree, director of Marcus & Millichap's National Multi Housing Group. “It’s been moving in this

direction for some time—now it’s moving at a faster pace.”



BUSINESS PLAN 2016


The Seniors Housing Sector Remains a Hot Play

A growing development pipeline is not dampening the outlook for the seniors housing sector. The big

story of late in the seniors housing sector has been the uptick in CONSTRUCTION.



Investor Relations

Business Plan for Acquisition Targets