PROPERTY DESCRIPTION

ACQUISITION PROCESS
We acquired 109th Street Industrial with Fort Capital on November 16, 2020, for $56.40 PSF, or an all-in acquisition price of $63.86 PSF. 109th Street is located one mile north of Panther’s other industrial property with Fort Capital, Arlington Industrial. Our original plan was to lease the one upcoming vacancy at the property and hold the property with a goal of selling it as part of a larger portfolio sale with Arlington Industrial in 3 to 5 years at a planned disposition price of $85.12 PSF (5.50% cap rate). This investment was underwritten to deliver a 16.8% average annual return and a 1.84x multiple on invested capital (MOIC).

PROPERTY HISTORY
Panther, with the sponsor, Fort Capital, contracted the property off-market at a price point well below market and replacement cost.The property completed a significant renovation in 2019 which included the transition from a single tenant space to a 3-suite building with new paint, dock doors and electrical throughout the property along with updated plumbing and expanded office space and demising walls in two of the three suites. It was well maintained although the roofs would eventually need to be upgraded (a large percentage of the potential cost was incorporated in our underwriting). Fort reserved $250,000 for roof repair, $110,000 for foundation repair in addition to a $50K price reduction, and an additional $220,000 for other tenant improvements (TI) including leasing commissions (LC). $100,000 of the capex was allocated for office buildout in the soon-to-be-vacant suite and $70,000 for a new, leasable, paved and fenced truck court. The proposed capital improvement budget represented 9.6% of total capitalization, most of which was put on hold pending the outcome of the sale process. The new Van/Trailer Parking Court was completed under budget and the space leased for $1.47 PSF on a 12-month term.

EXECUTION AND SALE
As a result of strong demand for industrial properties in the DFW Metroplex, Fort Capital and Panther agreed to market 109th Street for sale as part of a larger package which included Panther’s Arlington Industrial portfolio. The marketing process commenced mid-March. Our original underwriting called for a sale in year 5 at $89.73 PSF. The property sold on June 30, 2021, for $92.06 per square foot; Panther Investors receivedan 81.75% average annual return and 1.53x multiple on invested capital (MOIC) over the 8-month holding period.

This sale exceeded our pro-forma projections providing a 1.53x multiple to Panther FW Investors and an annual average return on investment of 81.75% over the 8-month holding period.

ACQUISITION PROCESS
A Panther and PHP acquired Blue Smoke on August 25, 2021, for an all-in purchase price of $9,000,000, or $54.64 per square foot. The portfolio consists of 10 buildings, built between 1973-1975, with 62 suites averaging approximately 2,657 square feet for a total of 164,718 square feet. The properties are located in the South Fort Worth industrial submarket and sit just east of Downtown Fort Worth. The property was 73% occupied at the time of purchase and had average rents of $3.80 NNN versus the market average rents of $4.00 to $6.00 NNN.

Additionally, the property needed significant improvements to the roofs, parking lot, building foundations, landscaping, and lighting. In late spring 2022, PHP successfully secured an off-market purchase of 2424 Blue Smoke Court North, an 18,000 square foot building adjacent to the existing portfolio. Panther obtained consent to fund this purchase using additional 100% equity from existing Limited Partners. The purchase price was $1,500,000, or $83.33 per square foot plus an additional $250,000 for reserves. On May 23, 2022, Panther and PHP closed the purchase of 2424 Blue Smoke, increasing the portfolio square footage to 183,718 square feet total.

PROPERTY HISTORY
In 2022, PHP pursued several lease negotiations ending in the execution of new leases and several renewals, along with the aforementioned capital improvements, which essentially were achieved in June 2022. The weighted average lease term has increased from 0.9 years at acquisition to 3.2 years today. Monthly distributions began in May 2022, 5 months ahead of original plan (Sept 2022), and continued at a 6.6% coupon rate prior to the June 2023 fire at the property (see details below).

Having completed the capital improvement plan, successfully leasing vacant space, executing renewals at market rate, and extending the lease terms for the majority of the tenant base, we and PHP elected to market the property for sale in May 2023. The property received strong initial interest; however, prior to call for offers, the property sustained a fire at 2400 Ludelle Street on June 16, 2023. 2400 Ludelle consists of 3 buildings (15,300 SF) on a single platted lot, one of which was impacted by the fire. After consulting with JLL, Panther and PHP decided to continue the sale process but to exclude 2400 Ludelle from the offering with a plan to market 2400 Ludelle once the insurance claims process was settled. Ultimately, we received a $1,500,000 payment from the insurance company and were able to include 2400 Ludelle in the transaction (the building impacted by the fire was demolished).

EXECUTION AND SALE
The property was awarded to Basis Industrial for $20.6 million, or $120.80 PSF (plus $1,500,000 from the insurance company). This equates to a 33% average annual return to Panther LP’s or a 1.69x Multiple on Invested Capital (MOIC) over the weighted average 2.1-year hold period (the original investment will be a 2.29-year hold period and the 2424 acquisition represents a 1.58-year hold). This price exceeds our original underwritten exit price of $95.51 per square foot (assuming a 6.15% cap rate) which projected to a 15% average annual return or 1.75x MOIC in year 5.

PROPERTY DESCRIPTION
The Casa Linda Apartments (formally named August Park Apartments) is a 158 unit apartment complex built in 1986 and located in southeast Dallas. The property consists of a mix of one, two, and three bedroom apartments with an average size of 844 square feet located in 16 two and three story building on 5.12 acres. The apartments are brick and wood sidings construction with pitched roofs, washer-dryer connections, and other normal modern interior features.

ACQUISITION PROCESS
The property was identified as a potential “value add” opportunity by Knightvest Capital of Dallas through an off market transaction. Knightvest was then introduced to Panther Transaction Group by Northmarq Capital (Dallas mortgage broker) a long time acquaintance of Panther .We were presented the opportunity to provide the majority of the equity for the transaction with Knightvest responsible for arranging the debt component, providing the guaranty on the mortgage and funding the earnest money deposit and due diligence costs. Once an agreement was reached on the terms of our partnership with Knightvest we jointly began our detailed due diligence review. The contract called for a 30 day review and a closing at the end of 60 days. Once we approved our inspections we prepared an offering memorandum and presented the opportunity to our Panther Investor Group. The offering was fully subscribed and we closed on the acquisition on May 27, 2010.

PROPERTY HISTORY
The previous owner paid approximately $7,000,000 ($44,300 per unit) and financed $5,300,000 with Fannie Mae. The owners overpaid for the asset and defaulted on the loan in 2009. Fannie Mae subsequently foreclosed on the asset and turned management over to Greystar Management to run the asset until it could be sold. Panther and Knightvest were able to negotiate a 50% discount to the original note balance and purchased the asset for
$2,650,000 or $16,722 per unit. Panther’s total budget for the property was $3,275,000 including renovation, repairs, and soft costs for an all in cost per unit of $20,728. The property was 78% occupied at closing and dropped to 70% due to our more stringent leasing requirements. After repairs and upgrades, changing the onsite management, and improving security we were able to increase occupancy to 90%+ within 6 months and began paying the investor preferential return beginning in November 2010. The investors received a onetime extra distribution in September 2011 which paid all their accrued preference to date and returned a portion of their initial investment. Monthly distributions of the 12% preference have been made every month thereafter. Current occupancy is now 94% and rental rates have been increased as planned.

BUSINESS PLAN
Our original business plan was straight forward.

• Change on-site management
• Increase security
• Make necessary improvements and upgrades
• Purge the tenant rent roll of undesirable tenants
• Institute strict leasing requirements for all new tenants
• Market to the growing Hispanic population in the submarket
• Make the property family friendly
• Increase occupancy and rental rates
• Sell the property when stabilized
• Target return to investors of 20% over a three to five year hold period

EXECUTION
Casa Linda reached stabilization during our first year of ownership and proceeded to meet all occupancy and rental projections for the following year. It was decided by all of the partners that the property was positioned to sell into a robust multifamily market. In the spring of 2012 Transwestern Commercial was engaged to market the asset. After a 60 day marketing campaign an out of state buyer was selected as the winning bidder. The property went under contract and after the buyers’ due diligence review sold on August 31, 2012.

The sales price was $5,065,000 or $32,056 per unit. The overall IRR to the Panther investors was 23.94% with an equity multiple of 1.53 over a 27 month hold period.

PROPERTY DESCRIPTION
Glen Arbor Apartments is a 320 unit apartment complex built in 1981 and located on 12.86 acres in Irving, Texas. The apartments are two story wood frame with a combination of brick veneer and stucco exterior with pitched composition shingle roofs. All units are individually metered for electricity and have individual HVAC units providing for low maintenance.

ACQUISITION PROCESS
The property was put under contract April 3, 2012, by Knightvest Capital of Dallas who has been Panther’s partner in most of our multifamily acquisitions. Knightvest provides onsite property management services and invests alongside Panther who provided 72.7% of the acquisition equity. Knightvest also obtains the third party debt component for the transaction and provides any guaranties required by the lender. Panther FW Investments and its’ investors provide no guaranties on the debt.

PROPERTY HISTORY
Panther closed the transaction on May 24, 2012. Glen Arbor was located in a high occupancy sub-market but was undermanaged resulting in below market rents along with sorely needed capital improvements.

The acquisition offered immediate 10% annual distributions to our investors. Glen Arbor was purchased for $10,700,000 ($33,437 per unit). This transaction was a value-add project scheduled to take approximately 36 months. Knightvest was able to capture this value-add component in 29 months. Overall occupancy remained in the mid-90s while growing rents over $138 per month on average. Knightvest implemented a modest interior upgrade program, including resurfaced countertops, new hardware, flooring and some new appliances.

EXECUTION AND SALE
Harvesting the added value with some future profit left for the next owner was commenced in the summer of 2014. Call for offers occurred July 1, 2014. We received 7 serious offers to purchase the property. Glen Arbor was sold for $45,842 per unit.

Panther’s original presentation projected hold period was 3 to 5 years with an exit cap of 7%. At the time of sale, we had owned the property 29 months and sold at 6.84% cap rate.

Panther FW investors achieved an annual return on investment in excess of 20%.