Cis Properties Llc Private Placement Info

CIS Properties LLC (USA)
(A Delaware, USA Limited Liability Company)

Private Placement

Maximum Offering Amount: $1,000,000,000

Price: US$250,000 per Series-A Preferred LLC Interest

Dividend Payment Rate of 7-15% per annum (Payable in
each Calendar Quarter)

1


Investment Targets

Distressed And Under-Valued:
Commercial real estate
Commercial Whole Loans
CMBS

In Russia and CIS countries
2


Market Overview
The combination of a credit crunch, lower consumer confidence,
increased consumer debt, and reduced consumer spending keep reducing
occupancy levels and property values in the commercial real estate sector
Sales of commercial properties has declined 58% globally
And hotel sales declined the most : down 75% globally
About US$10 billion of commercial property worldwide has been
foreclosed upon or transferred back to lenders (Feb09)
And US$72 billion was in default state (Feb09)
Many real estate developers cannot refinance short-term construction
loans
More CMBS and commercial mortgages are likely to default
Un-leveraged annual returns are about 22-34% for commercial
properties in Russia/CIS compared to 6-12% in the US and Western
Europe
3

(A Delaware, USA, Limited Liability Company)

Market Forecast
REAL ESTATE CREDITS & CMBS

There will be more M&A deal between Low levels of the credit availability
the financial instructions and developers Financial institutions will be willing to
We expect a substantial discount for credit only nearly ready projects
the properties of banks, developers and The mortgage market will not develop
construction companies, as they will until years 2011-2012
struggle to raise cash or avoid More developers will have problems
bankruptcy of default its credit obligation.
The shortage of new properties and New construction market will return to
development market that will happen the numbers of late 1990-s.
during the year 2010 will evolve in new The restructuring of developers’ loans
deficit of the properties in years 2011 – will end: shortage of liquid funds
2012. We expect financial institutions to
The availability of empty rental spaces keep interest rates high in order to
will increase the sub-rental market minimize risks
4


Investment Strategies

Sell the asset for a profit
Re-position the asset
Re-negotiate agreements/mortgages/leases
Hold the asset and earn a cash-on-cash return
Asset swaps
Re-package and spin-off the asset

5


Earning Revenues

Returns on investments from:
JVs with real estate developers (un-completed projects)
Existing distressed institutional-grade commercial real
estate
Whole loans and commercial leases
Commercial Mortgage Backed Securities
And
Fees for providing the equity (equity/mezzanine/bridge
financing/senior debt)
6


Investor’s Exit
Expected holding period is 4-6 years
Exit via:
Redemption of Preferred LLC Interest
Special Distributions to holders of Preferred LLC
Interests
Recoupment and Post-Recoupment Payments
IPO
Spin-off of assets into a public fund
7


Team Strength

Experience in commercial real estate and
mortgages
Experience in analyzing and managing
commercial properties
Knowledge of sophisticated financial
transactions, joint ventures and alliances.
Ability to identify under-valued assets
Ability to identify sources of value
Strategic Alliance with Colliers International
for Due Diligence and deal-sourcing 8


Strategic Alliance Partners
CIS Properties outsources critical functions * to the experts:

Colliers International will perform Due Diligence, handle
property management; and assist in identifying assets for
acquisition.
RBR LLC is a highly reputable engineering, due diligence and
consulting firm that is based in Russia. RBR LLC will perform due
diligence and assist in identifying assets for acquisition.

* Appraisals, property management, deal-sourcing

9


Competitive Advantages
Above-average Returns *: 7-15% per annum paid quarterly
for at least 2 years.
Minimal Re-Investment Risk For First Two Years: 7-15% per
annum paid quarterly for at least 2 years.
Professionalism: Experienced team and strategic alliances
with Colliers International and RBR LLC.
Tax-Free Asset Swaps: Opportunities to avoid the necessity
of writing-down assets via asset swaps.
Tax Benefits: Shield from bankruptcy proceedings and obtain
tax benefits.

* YTM for 3-YR US Treasury was 1.49%; 5YR UST at 2.37%; 30YR US
Treasury was at 4.16%; YTM for 3-YR UK Gilt was 1,69%; 5YR at 2,74%; 30YR
at 4,19% (Quotes as of 18th Sept 2009) http://markets.ft.com/markets/bonds.asp
10

(Delaware, USA, Limited Liability Company)

Offering Details
Commencement Of Offering………….…September 25, 2009
Termination Of Offering………….…After November 30, 2010
Face Value…………………..US$250,000 per Preferred LLC Interest
Dividend Rate ……………7-15% per annum paid quarterly
(payable until the “Recoupment” is completed)
Recoupment…………….Starts on the 2nd Anniversary of the
Closing Date and pays pro-rata share of the quarterly Operating
Income until the Face Value is paid back.
Post-recoupment…..…..Starts after Recoupment and pays pro-
rata share of quarterly Operating Income.
Redemption………………Starts on the 5th Anniversary of the
Closing Date.
Eligible Investors……………Only “Accredited Investors” who sign
the Subscription Agreement
* Accrual Rate of 7% per annum ** Closing Date – Date of the purchase of Preferred LLC Interest 11


Estimated Quarterly Cash-Flow Schedule For
Series-A Preferred LLC Interests
(one of several possible schedules of payments)

12


Investment Criteria For Loans
(sample criteria for whole loans)

Minimum Loan Face Value is US$10 Million.
Maximum purchase price as percentage of face Value shall be
60%.
Underlying property should be investment-grade office, retail,
industrial, multifamily, hotel or mixed-used property.
Gross Leasable Area must exceed 1,000 Sq.M.
At least 50% of GLA should be rented by tenants whose
annual sales and operating income exceed US$3 Million and
US$600,000 respectively.
Positive NPV, and a minimum cash-flow-only-IRR of 25% over
2-4 year holding period.
3-year Average Occupancy Rate greater than 80%
13


Risk Management & Governance
Pre-acquisition third-party Due Diligence and asset appraisals.
Annual or semi-annual third-party asset appraisals.
Investment Committee.
Audit Committee.
Strategic plans and continuous risk evaluation.
Compliance and Corporate Governance functions.
May use derivatives to hedge any interest rate exposure and/or
currency exposure that arises from purchases of CMBS and Whole
Loans.
Use of third-party credit enhancement: guarantees, insurance, etc.

14


Contact Details
Mike Nwogugu
Email: mcn2225@aol.com
Phone: 1-917-889-4716
Address: P O Box 996, Newark, New Jersey 07101, USA

Alex Gordienko
E-mail: alekseygodienko@yahoo.com
Phone +7-912-600-7016
Address: 96 Kosmonavtov Ave, office 33, Yekaterinburg, Russia,
620135

Olga Duka
E-mail: olga.duka@gmail.com
Phone: +7 903 618 92 84
Address: 85 Gagarin str., flat 24, Zhukovsky, Russia, 140160


THIS DOCUMENT IS NOT AN OFFERING IN
ANY JURISDICTION. INVESTORS MUST
REVIEW THE OFFERING MEMORANDUM,
CONDUCT DUE DILIGENCE AND CONSULT
THEIR LEGAL AND FINANCIAL ADVISORS
BEFORE INVESTING. EACH INVESTOR WILL
BE REQUIRED TO SIGN A SUBSCRIPTION
AGREEMENT BEFORE INVESTING IN THIS
VENTURE.

16

Cis Properties Llc Private Placement Info

Recommended

Recommended

More Related Content

What's hot

What's hot (18)

Viewers also liked

Viewers also liked (20)

Similar to Cis Properties Llc Private Placement Info

Similar to Cis Properties Llc Private Placement Info (20)

Recently uploaded

Recently uploaded (20)

Cis Properties Llc Private Placement Info