Our Fund I Projects: Hitting the Milestones

Our fundraising team did quite well for our Fund I, exceeding our goal by raising $131 million. Now it’s Urban Catalyst’s Development Team’s turn to shine.

As we continue raising funds for our Fund II, I’d like to fill you in on how we are progressing with our six Fund I projects. We expect them all to have broken ground by Q3 2022. Finally, a big thanks to our Fund I investors for making all this possible.

In August, Paseo became the first of the six projects to begin construction. Here’s the latest:

• Crews are currently at work repurposing the long-shuttered Camera 12 theater to serve as new mixed-use office and retail space.
• We announced in August that we’d pulled a building permit for the project and secured a $56.2 million loan through Rialto Capital.

• We’ve pulled the building permit and begun pre-construction for our renovation of the historic Knox-Goodrich Building, which will be the main entrance for our Fountain Alley Building.
• To top it off, the Fountain Alley Building will feature the largest rooftop restaurant and bar in Silicon Valley.

• We were approved at the Directors Hearing for The Mark, a purpose-built, off-campus student-focused hi-rise apartment tower.
• The Mark will feature over 200 multifamily apartment units, with the ability to house over 750 new urban residents in the Bay Area’s largest city.

• Next to Google’s coming mega-campus, our Keystone project got the final go-ahead in August from the City Council to move forward. This project will place an extended-stay Marriott in San Jose’s Downtown West.
• The nationally branded extended-stay Marriott TownePlace Suites business hotel will be 185,000 square feet and offer 175 suites, on-site parking and other standard amenities.

• We announced in early July that we’d closed on the final parcels of property for our Delmas Senior Living project, the first senior living project to be built downtown in at least three decades with an abundance of on-site amenities and easy access to downtown San Jose.
• We expect to be issued our building permits in the next 3 months with a ground breaking in Q4 projected.

• The city has given the go-ahead, the construction loan package is out to the market, and we’ll soon be seeking building permit approval for the Madera/TMBR development, a multi-family project located in the heart of Downtown San Jose.
• We expect to break ground in Q4.

While these Fund I projects move forward, you can count us to move things along for Icon/Echo projects in Fund II. By the way, the potential 10% reduction in taxes disappears at the end of this year. To learn more about investing in Fund II, contact us today.

Important Disclosures

The contents of this communication: (i) do not constitute an offer of securities or a solicitation of an offer to buy securities, (ii) offers can be made only by the confidential Private Placement Memorandum (the “PPM”) which is available upon request, (iii) do not and cannot replace the PPM and is qualified in its entirety by the PPM, and (iv) may not be relied upon in making an investment decision related to any investment offering by an issuer, or any affiliate, or partner thereof ("Issuer").

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With respect to any performance levels outlined herein, these do not constitute a promise of performance, nor is there any assurance that the investment objectives of any program will be attained. All investments carry the risk of loss of some or all of the principal invested. Assumptions are more fully outlined in the Offering Documents/ PPM for the respective offering. Consult the PPM for investment conditions, risk factors, minimum requirements, fees and expenses and other pertinent information with respect to any investment.

These investment opportunities have not been registered under the Securities Act of 1933 and are being offered pursuant to an exemption therefrom and from applicable state securities laws. All offerings are intended only for accredited investors unless otherwise specified.

Past performance are no guarantee of future results. All information is subject to change. You should always consult a tax professional prior to investing. Investment offerings and investment decisions may only be made on the basis of a confidential private placement memorandum issued by Issuer, or one of its partner/issuers. Issuer does not warrant the accuracy or completeness of the information contained herein. Thank you for your cooperation.

Real Estate Risk Disclosure:

- There is no guarantee that any strategy will be successful or achieve investment objectives including, among other things, profits, distributions, tax benefits, exit strategy, etc.;
- Potential for property value loss – All real estate investments have the potential to lose value during the life of the investments;
- Change of tax status – The income stream and depreciation schedule for any investment property may affect the property owner’s income bracket and/or tax status. An unfavorable tax ruling may cancel deferral of capital gains and result in immediate tax liabilities;
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- Reduction or Elimination of Monthly Cash Flow Distributions – Like any investment in real estate, if a property unexpectedly loses tenants or sustains substantial damage, there is potential for suspension of cash flow distributions;
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Opportunity Zone Disclosures

- Investing in opportunity zones is speculative. Opportunity zones are newly formed entities with no operating history. There is no assurance of investment return, property appreciation, or profits. The ability to resell the fund’s underlying investment properties or businesses is not guaranteed. Investing in opportunity zone funds may involve a higher level of risk than investing in other established real estate offerings.
- Long-term investment. Opportunity zone funds have illiquid underlying investments that may not be easy to sell and the return of capital and realization of gains, if any, from an investment will generally occur only upon the partial or complete disposition or refinancing of such investments.
- Limited secondary market for redemption. Although secondary markets may provide a liquidity option in limited circumstances, the amount you will receive typically is discounted to current valuations.
- Difficult valuation assessment. The portfolio holdings in opportunity zone funds may be difficult to value because financial markets or exchanges do not usually quote or trade the holdings. As such, market prices for most of a fund’s holdings will not be readily available.
- Capital call default consequences. Meeting capital calls to provide managers with the pledged capital is a contractual obligation of each investor. Failure to meet this requirement in a timely manner could elicit significant adverse consequences, including, without limitation, the forfeiture of your interest in the fund.
- Opportunity zone funds may use leverage in connection with certain investments or participate in investments with highly leveraged capital structures. Leverage involves a high degree of financial risk and may increase the exposure of such investments to factors such as rising interest rates, downturns in the economy or deterioration in the condition of the assets underlying such investments.
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