Phoenix Realty Group: Services

San Diego Smart Growth Fund

Fund Overview
The San Diego Smart Growth Fund is a $90 million private equity real estate fund providing equity financing for the development of workforce housing, mixed-use and commercial properties in the greater San Diego area. The Fund invests in the development of residential properties, including townhomes, condominiums, live/work lofts, multifamily apartments, and single-family homes, as well as mixed-use and commercial properties.

The Fund was closed in April 2005 with capital commitments from institutional investors including public pension funds, insurance companies and banks. The Fund is projected to produce approximately $590 million of real estate development and approximately 1,300 new housing units.

Investment Strategy
This fund provides equity financing to third-party developers for the development of for-sale and rental market rate housing, and commercial properties for the middle-income workforce in the greater San Diego area. It has the full endorsement of the City and County of San Diego at a time when the area's housing affordability is at an all-time low.

The Fund enables moderate-income wage earners to enjoy the benefits of home ownership while returning properties to the tax roles at a higher tax rate than vacant land or underused commercial/industrial structures.

Social Benefits
The social benefits for residents of these urban communities include attractive housing, reduced commuting times and more time available for family, leisure and community service.

Phoenix Realty Group Urban Private Equity Funds enjoy significant real estate risk mitigation due to community-wide public support, the leveraging of public subsidies and developer guarantees and subordination at the property level.

Strategic Partnership
The San Diego Smart Growth Fund is the product of collaboration between the San Diego Capital Collaborative and Phoenix Realty Group. The San Diego Capital Collaborative is a not-for-profit organization chartered by the San Diego City-County Reinvestment Task Force to facilitate public and private investments in emerging and underserved communities in the greater San Diego area. As a result of this collaboration, the Fund enjoys support from local government officials, neighborhood groups and other community stakeholders.

Properties

San Diego Smart Growth Fund Developer Term Sheet

Definition of a Smart Growth Fund

A smart growth fund, a majority of whose investments qualify for the Community Reinvestment Act credit to regulated banks, fulfills the socially responsible investment objectives of institutional investors. A smart growth fund has three main goals: to enhance existing communities, to preserve natural resources and to save taxpayers the cost of new infrastructure resulting from sprawl. These strategic investments seek to take advantage of properties that require repositioning via development, renovation, leasing upgrades, resolution of environmental issues or by other means which may significantly increase market value and economic activity in low- to moderate-income neighborhoods.

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