1 * This marketing material relate to the distribution of units of the InvestPlus Real Estate Investment Trust under an offering memorandum dated May 30th, 2017 and is incorporated into and form part of the offering memorandum
Disclaimer The information contained herein is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from InvestPlus ● (the “Company”) and should not be made available to any other person or entity without the written consent of the Company. The material contained herein is for information purposes only and does not constitute an offer to sell nor a solicitation of an offer to buy the securities. An offer can only be made by the Offering Memorandum and the appropriate exemption documents being provided to prospective purchasers. This information is inherently limited in scope and does not contain all of the applicable terms, conditions, limitations and exclusions of the investments described herein. Prospective purchasers should read the Offering Memorandum before considering investment in this project. This material is in no way a complete description of the proposed investment and is in all respects subject to the provisions of the Offering Memorandum and the Declaration of Trust . The information contained herein is not to be relied upon; investors should rely on the information described in the Offering Memorandum. Every effort was made to obtain accurate and complete information; however, no representation, warranty or guarantee, expressed or implied, may be made as to the accuracy or reliability of the information contained herein. The only representations and warranties made by the Company would be those contained in an Offering Memorandum and a definitive subscription agreement. The InvestPlus Real Estate Investment Trust. intends to make regular distributions of its available cash to Unitholder, such distributions may be reduced or suspended and are not guaranteed. These offerings may be subject to potential risks associated with the investment, including market, liquidity and investment return risk. Please consult the offering documents for further information regarding these potential risks. Using borrowed money to finance the purchase of securities involves greater risk than a purchase using cash resources only. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remain the same even if the value of the securities purchased declines. In order to be eligible for subscription in this Offering, individuals must satisfy the criteria required for investors as described in the Offering Memorandum. 2
Presentation Overview Focused where other public or private REITs are not. • Private Real Estate generating Above Average, Non-correlated • Returns with Low Volatility Geographically diversified in Western Canada • Tax Efficient Growth Investment Vehicle • Quarterly Income Distributions (6.47% Annually) + Potential • for unit-holder growth 3
History Based in Calgary, Alberta • Incorporated in 2004 • The York – 45 Suites Acquired MF & Commercial properties through Joint Ventures • & LPs Restructured into private InvestPlus REIT (IPR) in 2015 • Provides an opportunity to invest in a diversified portfolio of • multi-unit residential apartment and commercial buildings in western Canada 4
InvestPlus Transaction History ✓ 18 buildings ✓ 420 Rental suites The Luxemburg – 23 Suites + 7,000 sq-ft commercial ✓ 64,000 sq-ft Commercial ✓ Over 250 Investors ✓ Transacted over $75M in assets ✓ Current assets in BC, AB & SK 5
InvestPlus REIT Portfolio ✓ $34.3mm in Assets ✓ 8 buildings ✓ 161Rental Units ✓ 64,000 Sq-ft Prince George (1 property ) Edmonton ( 4 properties) Commercial Calgary (2 properties) Saskatoon (1 property) ✓ 60/40 split MF to Commercial 6
Beaumont Case Study At Acquisition After Normalization Beaumont Manor – 21 Suites Edmonton, Alberta Renovated the building and refinanced in Building was purchased during the credit crisis ($35/bpd oil) October 2009 and pulled out $320,000 in equity Value Oct 2009: $2,01M 17% Rents were significantly below market Annual NOI: $133,920 28% Purchase (March 2009): $1.51M Refinanced Oct 2009: $1,700,000 Annual NOI: $104,220 Equity take out: $ 300,000 Upgrading cost: $300,000 Upgrading timeline: 8 months Sold Jan 2014: $2,394,000 4 Cash on Cash Return: 65.7% Total Invested: $600,000 7
5 Reasons to Invest into a REIT Source: Real Property Association of Canada 1. REITs offer diversification and a level of stability, without sacrificing growth potential. 2. REITs provide exposure to real estate – real assets with tangible value and reliable income streams 3. REITs are distinct in their combination of relatively steady income, capital gains potential and tax benefits 4. Typically, REITs provide more attractive yields than other income investments. 5. REITs are subject to more stringent regulations in areas such as leverage and financial reporting, providing investors with an added layer of security. 8
Private vs Public Differences A Public REIT is listed on a stock exchange A Private REIT is not listed on a stock ➢ ➢ exchange. A Public REIT, while liquid, can be volatile. ➢ Traded stock investors can push values up or Private REITs are not liquid, however, ➢ down and to extremes very quickly redemptions and subscriptions are based because of liquidity and that becomes the upon the value of the underlying real estate new price, regardless of the underlying asset and not a traded market price which may be substantially different than the value of value. the underlying real estate. Public REIT’s have additional costs compare ➢ to a private REIT that are paid by the REIT, InvestPlus REIT as a private REIT isn´t exposed ➢ which reduces returns to investors in a Public to the extreme volatility of the stock market. REIT InvestPlus REIT can only be bought by ➢ Public REITs can be invested by Qualified Investors via Offering Memorandum ➢ or accredited investors only in Quebec. anyone “ The market is a voting machine, NOT a weighing machine ” (Buffett/Graham) 9
Strategy Target and acquire accretive multi-unit residential apartments and commercial properties where other public or private REITs don’t exploit due to size, lack of local presence or criteria. 10
Strategy (Phase 1 – next 12 -18 months) Commercial Buildings Target commercial buildings in urban and • suburban markets with a history of high occupancy and low tenant turnover Target lease-back-term buildings and single- • tenanted buildings with triple net leases and higher quality tenants Stagger term of leases • Leverage management’s network of building • owner and sellers 11
Strategy (Phase 2 – in12 -18 months) Multi-unit Residential Apartments Target and acquire multi-unit residential apartment buildings that • operate with attractive margins and cap rates as a result of: No repair or maintenance of underground parking garage • Lower utility cost resulting from elimination of heating of underground parking garages • Lower property taxes in suburban markets • Cluster assets to provide for better efficiencies, less man power and • commanding rental position Maximize efficiencies through internal asset and property • management and advanced retention strategies 12
5 Reasons to Invest in Western Canada 1. British Columbia expects to have economic growth of 3.0 per cent this year . - RBC Report June 2017 2. Saskatchewan economy to bounce back in 2017: 2.5% - Conference Board of Canada Provincial outlook June 2017 3. Alberta Is About to Be Canada's Fastest Growing Economy Again - Bloomberg July 2017 4. Large millennial generation (1/3 of population) are choosing to rent vs buying. 5. In some circumstances new or newer purpose-built apartment buildings are selling below replacement cost. 13
Recent Purchase The Brunswick – 13,704 sq-ft Prince George, BC Purchase Dec 2015 $2,800,000 • Est. Value Dec 2016: $3,100,000 7% • Purchase Cap Rate 8.6% • Est. free cash flow: $24,000 • Lease Expiry December 2025 • Triple-Net Lease: The tenant is financially • responsible for management, operations and capital improvements Accretive – Additional free cash flow of • $20,000/year after distributions, debt, expenses and debt repayment based on current rents 8 14
Recent Purchase 17,900 sq-ft of commercial space, • south of Calgary Purchased: $3,63M • Closed Aug 8, 2017 • 6-years left on lease • Expanding to Prairies (Edmonton, • Saskatoon, Winnipeg) Triple-net lease – tenant is financially • responsible for all operational costs 15
Recent Purchase 30,000 sq-ft of prime commercial space in SK • Purchased Oct 10, 2017: $3.35M • National tenants • 7.8%+ cap rate • Air Canada exapanding Kelowna (2019) • Triple-net lease – tenant is financially responsible • for all operational costs 16
TEAM 17
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