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The Marina at Peppers Creek Investor Document January 2007

The Marina at Peppers Creek Investor Document January 2007. Marina at Peppers Creek Property Overview We will be developing 88 acres into a 123 home community including a marina and waterfront clubhouse amenity. Description.

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The Marina at Peppers Creek Investor Document January 2007

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  1. The Marina at Peppers CreekInvestor DocumentJanuary 2007

  2. Marina at Peppers Creek Property Overview We will be developing 88 acres into a 123 home community including a marina and waterfront clubhouse amenity. Description • Property consists of 88 acres located in Dagsboro, DE, overlooking Pepper Creek and the Rehoboth Bay • Put land under contract in November 2004 for $80K per unit ($10.0M) to be settled after final approval • Minutes to the Delaware shore, shopping, and recreation Approvals • Final Approval secured • Approved for 88 slip marina • Site work began Winter 2006 Master Plan • Master plan consists 123 single family home sites, 88 slip marina, expansive marina club with pool and dining facility • Intend to sell finished lots to buyers, and construct 2 model homes to set the tone for the community • Marina will manage several community boats for the use of community residents at a nominal charge • Linking 3 sections of project into overall Peppers Creek umbrella enables shared amenities package including pool, community center, and 88 slip marina

  3. Peppers Creek Property – Appraised Value Appraised value of the of the Marina prior to improvements is $14.54M, or 45% over our purchase price. Appraisals by Property $ Million Source: McCain

  4. Peppers Creek Property – Aerial View The Peppers Creek property is located just west of the bay, Bethany Beach and the Atlantic Ocean. Aerial View of Dagsboro & Peppers Creek Property (From West looking East) Marina Rte 113

  5. Market Assessment The property location in Dagsboro addresses many of the key aspects a pre-retiree/retiree seeks. Consumer Desire Community Amenities Low cost of living/ home price Quality Control & Follow-up Service Ease of Access / Limited Traffic Peppers Creek Will offer 88 slip marina (caters to boaters and sportsmen), community pool, sundecks, community center, & meeting rooms Home sites starting below $200K with no builder tie-in – providing beach living within 11 miles of the shore, and directly on the bay, and the flexibility to choose your own builder Premier Schell Brothers service levels Easy arrival via Rte 113, avoiding Rte 1 traffic Quick ride to Bethany Beach and Ocean City through Rte 26 corridor 1 2 3 4

  6. Marina - Community Site Plan The Marina community will consist of 123 home sites and an amenity package featuring an 88 slip marina. • Marketing Advantage • Marina property has existing approval for 88-slip marina. • In today’s permitting environment, it is virtually impossible to obtain approval for marina construction. • Our marina represents a significant competitive advantage, with few players able to offer marina amenities due to barriers to entry Amenity and Marina complex

  7. Marina - Community Amenities The community will offer a unique opportunity for a marina, pool, and marina club directly on Peppers Creek. Conceptual Plan of Shared Amenities Located at the Marina Pool and sundeck Marina club 88 slip marina

  8. Marina - Community Amenities The marina club will have a pool and sun deck overlooking the bay and Pepper Creek.

  9. PRELIMINARY Marina - Financials Current pro forma reflects total project costs of ~$21M. . . Our cost projections assume a focus on delivering value to the customer and best-in-class amenities Total $M 10.2 7.4 0.0 3.4 20.9 Per Unit $K 82.4 60.2 0.0 27.6 170.1 Cost Category Land Costs On- and Off-site Costs* Construction** Soft Costs*** Total Totals are not the sum of the components due to rounding *Assumes 50% of amenity cost paid by Woodlands and Highlands communities **Excludes costs associated with construction of 2 model homes ***Includes interest expense

  10. PRELIMINARY Marina - Financials The Marina will deliver ~$10M in before tax cashflow while delivering a key component of a best-in-class master planned community to Sussex County. Unique product positioning paired with a best-in-class amenities package yields strong project returns. $33.6M $31.2M $20.9M $10.3M 57 units (46% of project) Performance Metric Gross Revenue* Net Revenue Project Expenses (Incl Int) Before Tax Cashflow** Number of Units to Retire Debt *Net Revenue = $31.2M, due to projected $2.4M in unit settlement costs **Total does not equal components due to rounding

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