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Apartment Investor Academy Ventura County Apartment Market Update Dawn Dyer, President Dyer Sheehan Group, Inc. Ventura, CA (805) 653 8100 dawn@dyersheehan.com February 23, 2011 Why Apartments? Why Apartments? Strong Fundamentals

SLIDE 1

February 23, 2011

Apartment Investor Academy

Ventura County Apartment Market Update

Dawn Dyer, President Dyer Sheehan Group, Inc.

Ventura, CA (805) 653‐8100 dawn@dyersheehan.com

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Why Apartments? Why Apartments?

Strong Fundamentals Apartment Recovery Leading Job Growth The Housing Market Collapse & Credit Crisis Demographic Trends Favor Multi-Family Lifestyle Choices The Greening of America Strong Economics Supply Constraints

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

The Benefits of The Benefits of Multi Multi‐ ‐Family Housing Family Housing

Efficient Use of Scarce Land Resources Provides Workforce Housing Promotes Diversity in Communities Revitalization of Downtowns & Greyfields Supports Job Retention Reduces Commute Times

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Housing Crisis & Mortgage Meltdown Housing Crisis & Mortgage Meltdown

New Demand from those who Lost or Bailed Changes in Consumer Psyche Tougher Mortgage Requirements Affordability Homeownership vs. Rent & Invest

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Demographic Trends Demographic Trends

Generation Y Aging Boomers Single Person Households New Americans Alternative Family Structures

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Lifestyle Choices Lifestyle Choices

Live/Work/Play Eco‐Friendly Lock and Leave Convenience Mobility Freedom from Responsibilities of Owning

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Economics of Housing Economics of Housing

Job Growth for 20‐34 Year Olds U.S. Housing Policy Pent‐Up Demand (Renters & Investors) Affordability Recession‐Proof Elasticity Flight to Quality

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Apartments Provide Safe Harbor Apartments Provide Safe Harbor with Upside Potential with Upside Potential

Basic Commodity Item Short‐Term Leases Low Vacancy During Recession Strong Demand Factors Rent Appreciation Anticipated Opportunities to Reposition Benefits of 1031 Exchange Leverage

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Update on Apartment Financing Update on Apartment Financing

Michael I. Orman

EVP/Chief Operating Officer

County Commerce Bank

2400 E. Gonzales Road, Oxnard, CA 93036 3260 Telegraph Road, Ventura, CA 93003 Phone: (805) 477‐7611 Fax: (805) 477‐0638

morman@CountyCommerceBank.com www.CountyCommerceBank.com

SLIDE 10

February 23, 2011

2010 Multi 2010 Multi‐ ‐ Family Sales Family Sales

Parker Shaw

Multi‐Family Sales Dyer Sheehan Group, Inc.

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

2010 Ventura County Multi‐Family Transactions

1961 1964

Average Yr Built

24,828 51,646

Average Bldg Size (SF)

31 53

Average # of Units

496 896

Total Units

$109,061.37 $114,631.29

Average Price/Unit

$145.18 $146.62 Average Price/ SF 6.37% 6.29% Average Cap Rate $3,406,322 $8,000,068 Average Sale Price $54,501,150 $136,001,150 Total Sale Volume 16 17 Total Transactions

2010 Sales w/o Serenade All 2010 Sales

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

1961 1964

Average Yr Built

24,828 51,646

Average Bldg Size (SF)

31 53

Average # of Units

496 896

Total Units

$109,061.37 $114,631.29

Average Price/Unit

$145.18 $146.62 Average Price/ SF 6.37% 6.29% Average Cap Rate $3,406,322 $8,000,068 Average Sale Price $54,501,150 $136,001,150 Total Sale Volume 16 17 Total Transactions

2010 Sales w/o Serenade All 2010 Sales

2010 Ventura County Multi‐Family Transactions

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Ventura County Total Transactions

10 20 30 40 50 60 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09 2010 Yearly Transactions 10-Year Average

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Ventura County Average Cap Rate

4.5% 5.0% 5.5% 6.0% 6.5% 7.0% 7.5% 8.0% 8.5% 9.0% 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09 2010

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Ventura County Average Price Per Unit

$60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 $200,000 $220,000 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09 2010 Yearly Average 10-Year Average

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February 23, 2011

Parker Shaw

Multi‐Family Sales Dyer Sheehan Group, Inc. Parker@DyerSheehan.com

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Ventura County Vacancies

0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Average Monthly Rent in Dollars

Average Weighted Vacancy Rate

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Average Ventura County Rents

$0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Monthly Rent in Dollars $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 $2.00 Rent in $ oer SF Average Monthly Rent Average Rent in $ per SF

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Average Two Bedroom Apartment Rents Ventura County, January 2011

Camarillo Fillmore Moorpark Ojai Valley Oxnard/Port Hueneme Santa Paula Simi Valley Ventura Thousand Oaks/Westlake Village Combined Areas

$800 $900 $1,000 $1,100 $1,200 $1,300 $1,400 $1,500 $1,600 $1,700 Average Monthly Rent in Dollars

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Supply Constraints Supply Constraints

Access to Development Capital Land and Production Costs Limited Land Zoned for Multi Family Entitlement Hurdles, Delays, and Litigation Fees, Infrastructure, and Offsite Improvements Parking Standards GOD, SOAR and MS4 NIMBYs and BANANAs

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Ventura County Building Permits

500 1000 1500 2000 2500 3000 3500 4000 4500 5000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Total Permitted Units Single Family Permits Multi‐Family Permits

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Multi Multi-

Family Investment

Family Investment Outlook Outlook

Strong Market Fundamentals Continue Supply/Demand Imbalance Most Affordable Housing Type Low Vacancy Rates Changing Demographics Opportunities to Add Value Strong Upside Potential in Rents

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Apartment Investor Academy | Ventura County Apartment Market February 23, 2011

Questions?

Dawn Dyer

Dyer Sheehan Group, Inc. Dawn@DyerSheehan.com