Objectives

Stone Street Capital, LLC

Objectives

Stone Street's investment strategy is to acquire assets with:

(a) strong existing or potential cash flows,

(b) at values below replacement cost,

(d) which fit the Strategic Objectives of the company.

These properties should exhibit the following Strategic Objectives:

bullet Superior Risk Adjusted Returns;

bullet Cash Yields significantly higher than institutional quality bond yields;

bullet An investment basis that represents a discount to replacement costs;

Stone Street will invest in properties in cities and suburban areas which are expected to recover and grow at a rate in excess general economic growth. These include cities with port operations, state capitals, substantial infrastructure investments, demographic shifts, job/income growth and well-developed transportation hubs.

Focus

The Company's investments will exploit (a) pricing dislocations from biased capital flows (size, location, growth, etc.), (b) existing owners whose financial stress is largely unrelated to real estate fundamentals, (c) regulatory pressure on servicers/lenders to recapitalized assets and (d) owners who are unable to add capital to a quality asset.

Depending on asset type and quality, the Company will target immediate cash returns of 7% to 10% and IRRs above 17.5%. Stone Street will seek transactions requiring a capital investment from owners who are unwilling to continue funding operations; refinancing opportunities where credit enhancement is needed; roll-up opportunities for 'broken TIC' transactions, and Stone Street willing to purchase less than 100% ownership in certain assets.