BUILDING ON MOMENTUM

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1 BUILDING ON MOMENTUM Investor Update 2016

2 CLEVELAND DEVELOPMENT ADVISORS (CDA) HAS A 25-YEAR HISTORY OF INTELLIGENTLY MANAGING PRIVATE FUNDS THAT PROVIDE FOR INVESTMENT IN REAL ESTATE AND BUSINESS PROJECTS INTENDED TO ATTRACT ADDITIONAL DEVELOPMENT. GUIDED BY OUR MISSION TO IMPROVE THE OVERALL CHARACTER AND VITALITY OF GREATER CLEVELAND, THE PROJECTS WE HAVE SUPPORTED OVER THE YEARS HAVE BEEN TRANSFORMATIONAL FOR OUR COMMUNITY. WE RE COMMITTED AND ENTHUSIASTIC TO CONTINUE ON THIS PATH AND LOOK FORWARD TO SEEING WHAT THE NEXT 25 YEARS WILL BRING. 2

3 CREATING A LEGACY A LETTER FROM THE CHAIRMAN AND THE PRESIDENT 2015 represented a milestone year for Cleveland Development Advisors (CDA). It was 25 years ago, in December 1990, that CDA closed on its very first loan. True to our mission to invest in real estate and business projects intended to attract additional development with the overall goal of improving the character and vitality of Greater Cleveland this first loan was to help finance the construction of the Gateway Sports and Entertainment Complex, home to Progressive Field and Quicken Loans Arena. Since that time, we have closed on funding to 133 investments that represent nearly $3 billion in construction costs. Robert O'Brien Chairman In 2015, CDA experienced another significant achievement with the receipt of a $50 million allocation of the New Market Tax Credits (NMTC) Program. This represents our fifth and largest allocation of New Market Tax Credits and brings the total NMTC allocation to CDA to $155 million. As part of a highly competitive application process, we were able to detail our 25-year history of catalytic investment and public-private partnership to secure this award, the largest one made in 2015 to entities with a local investment footprint. Using this award, CDA closed on three transactions deploying $25 million into projects that will result in $95 million in economic development spend to our region. In addition, CDA provided nearly $10 million in subordinate debt from our capitalized loan funds to help finance projects with total development costs of $73 million. During the past year, we saw the opening of the second phase of the Flats East Bank neighborhood as well as the opening of Innova in University Circle. These investments continue to build upon a long lineage of CDA efforts to capitalize on and promote the strengths of our region. We look forward to 2016, a year in which Cleveland will be center stage in the national spotlight, with great pride as many of the assets that positioned Cleveland for this opportunity were the result of our efforts over the past 25 years. These efforts are only possible as a result of the generous support of our investor partners. Yvette M. Ittu President 3

4 THE ARCHER APARTMENTS 4 Morgan Management recently purchased The Archer Apartments located in the Warehouse District and is undertaking a long-needed rehabilitation that will upgrade all floors of the building including the 250 apartment units, common areas and parking. One of the largest and most-visible buildings in the Cleveland Warehouse District, the former National Terminal Apartments, was one of the first buildings converted to housing in The building was not well maintained and units were difficult to rent, some having the highest vacancy in the market. The Advance Cleveland Development Fund has committed $3.5 million of the $37 million rehabilitation that will address maintenance and code deficiencies as well as amenity upgrades and bring the building up to the standards of other buildings in downtown Cleveland.

5 OPPOSITE PAGE, TOP: Water tower atop The Archer OPPOSITE PAGE, BOTTOM: Shared space and apartment interior inside The Archer LEFT: Interior view of an apartment in The Creswell BELOW, MIDDLE: Façade of The Creswell building BELOW, BOTTOM: Architect's rendering of The Edison at Gordon Square THE CRESWELL APARTMENTS 80 market-rate apartments The Slyman Group and The Dalad Group partnered to take on the historic renovation of The Creswell. This vacant 11-story building has been transformed into 80 market-rate apartments and 6,000 square feet of ground-floor commercial space. The project builds on the momentum of Playhouse Square, which resulted from significant recent investment, and provides product to meet the demonstrated market demand. The Advance Cleveland Development Fund provided $4.5 million and the Cleveland Development Partnership provided $400,000 to help make this $17 million project a reality. THE EDISON AT GORDON SQUARE This vacant former industrial site in the Detroit Shoreway neighborhood is being reinvented by The NRP Group with the construction of 300 market-rate apartments overlooking the recently redesigned West Shoreway. The Advance Cleveland Development Fund provided a $6 million loan as part of this $55 million new construction project that will offer a variety of housing styles including garden/flat units as well as three-story townhomes, all with panoramic views of Lake Erie. The Edison at Gordon Square will build on the momentum created by previous nearby CDA investments at Battery Park and Capitol Theatre. 5

6 URBAN COMMUNITY SCHOOL Urban Community School, an independent faith-based school, was established in 1968 with a belief that every child deserves a great education and welcomes students and families without regard to their ability to pay. Due to expanding enrollment, the school undertook construction of a 32,200-square-foot addition to serve as a new, dedicated middle school wing, freeing up existing classrooms for more students in lower grades. Cleveland New Markets Investment Fund II provided $5 million in Federal New Markets Tax Credits and $1 million in State of Ohio New Markets Tax Credits to make this project a reality. This new expansion will allow the school to increase enrollment by 100 students and provide a quality education to students in need. 6

7 $10M Tax credit provided by the Cleveland New Markets Investment Fund II THE SALVATION ARMY OPPOSITE PAGE, TOP & MIDDLE: Urban Community School students in their classrooms The Salvation Army is on the front lines fighting to improve the quality of life for the residents of low-income communities. In 2012, the Salvation Army undertook a study to determine the best method to strengthen and expand its services throughout greater Cleveland. The result was the Cleveland Plan, which allocated resources to places where the needs are most critical, expanded corps services, invested in new locations where The Salvation Army is needed, and provided assistance with keeping operational costs under control. The Cleveland Plan includes construction and/or renovation of four facilities across Greater Cleveland. These facilities are the Temple Corps facility in Collinwood, the Zelma George Family Shelter downtown, the East Cleveland Corps as well as the West Park Corps locations. The new facilities will provide additional space for programs and services to improve the quality of life for underserved populations. Cleveland New Markets Investment Fund II provided a $10 million Federal New Markets Tax Credit (NMTC) allocation as well as a $1 million State of Ohio NMTC allocation as part of this overall $36 million project that included NMTC allocation from two other national sources. OPPOSITE PAGE, BOTTOM: The Urban Community School building ABOVE: Groundbreaking at the Salvation Army Temple Corps facility 7

8 6 New entertainment venues, with three more anticipated to open in 2016 FLATS EAST BANK In 2015, Phase II of the Flats East Bank neighborhood began welcoming residents to the 240 new market-rate apartments as well as visitors to new entertainment and dining venues. Located on the banks of the Cuyahoga River, this destination neighborhood is now home to an Aloft Hotel, the 23-story Ernst & Young office tower, 240 apartments, six new entertainment venues with three more anticipated to open in 2016, and a new riverfront boardwalk. Cleveland Development Partnership provided $3 million in financing and Advance Cleveland Development Fund provided $1.5 million to the developers Wolstein Group and Fairmount Properties to make this second phase a reality. 8

9 INNOVA After more than 10 years of planning, The Finch Group delivered the first phase of the Innova project in Advance Cleveland Development Fund provided $3 million toward this $42 million first phase which includes 177 market-rate apartments and 23,000 square feet of commercial space. Innova is strategically located between Cleveland Clinic s main campus and the cultural institutions in University Circle. Future phases are anticipated to bring additional apartments, commercial and retail locations, as well as affordable senior housing. 177 Market-rate apartments 23,000 Square feet of commercial space OPPOSITE PAGE, TOP: The Flats East Bank revitalization project OPPOSITE PAGE, BOTTOM: Punch Bowl Social, located in the Flats East Bank ABOVE, LEFT: Shared rooftop space at the Innova building ABOVE, RIGHT: Interior view of an Innova apartment RIGHT: Exterior of the Innova building 4 9

10 133 INVESTMENTS made toward growing and strengthening our city 5.9 $ 283 MILLION of commercial square feet created MILLION in financing provided to date $ 2.9 $ 251 BILLION in development generated by CDA investments MILLION in assets under management 10

11 BOARD OF DIRECTORS Robert O Brien, Chairman Executive Vice President, Forest City Enterprises, Inc. Lillian Kuri Program Director for Arts and Urban Design, The Cleveland Foundation Paul Clark, Vice Chairman Northern Ohio Regional President, PNC Bank Quentin L. McCorvey Sr. Principal, M&R Distribution Services Sashi Brown Executive Vice President, Football Operations, Cleveland Browns Brian Power Tax Counsel, Sherwin-Williams Co. Kip Clarke Executive Vice President, New Business Development, KeyBank Edward Rybka Chief of Regional Development, City of Cleveland James Geuther Northeast Ohio Regional President, JPMorgan Chase Bank, N.A. Jeffrey Wild Partner, Benesch Law Firm Vickie Eaton Johnson Senior Director of Community Relations, Cleveland Clinic Alan Zang Northeast Ohio Regional President, U.S. Bank Jerry Kelsheimer President and CEO, Fifth Third Bank, Northeastern Ohio STAFF Yvette M. Ittu, President Executive Vice President of Finance & Operations, Greater Cleveland Partnership Joseph D. Roman, 2nd Vice Chairman President and CEO, Greater Cleveland Partnership Deb Janik, Treasurer Senior Vice President, Real Estate and Business Development, Greater Cleveland Partnership Dean M. Parker Vice President, Finance and Investor Relations Cindy Binnig Manager Accounting and Asset Management Jessica Coffey Manager of Project Development Doniella Ligon Executive Assistant Steve A. Luca Managing Vice President 11

12 ACKNOWLEDGMENTS Cleveland Development Advisors sincerely thanks our corporate and civic partners who have made possible our efforts to revitalize the Greater Cleveland community. INVESTORS American Greetings Corporation Applied Industrial Technologies, Inc. AT&T BP America, Inc. Baldor Electric Co. Calfee, Halter and Griswold, LLP Case Western Reserve University Charter One Bank F.S.B. Cleveland Clinic Cleveland Foundation Cliffs Natural Resources, Inc. David H. Jacobs DDR Dominion East Ohio Eaton Corporation Fifth Third Bank FirstEnergy Corporation FirstMerit Corporation Forest City Enterprises, Inc. Cleveland Development Advisors is an affiliate of Goldman Sachs Goodrich Corporation Greater Cleveland Partnership Huntington National Bank Invacare Corporation Jo-Ann Stores, Inc. Jones Day Foundation JPMorgan Chase KeyBank Lincoln Electric LTV Corporation Lubrizol Luxottica Group S.p.A Macy s, Inc. Materion Corporation Nesco, Inc. Nestle USA, Inc. Northrop Grumman Systems Corporation Ohio Savings Bank Parker Hannifin Corporation PNC Bank PolyOne Corporation Premier Farnell Corporation R.T. Foundation Richard E. Jacobs RPM International, Inc. Scott & Fetzer Foundation Scott Technologies, Inc. Sherwin-Williams Co. SS&D Foundation Teachers Insurance & Annuity Association of America Tops Markets, LLC University Hospitals U.S. Bank Win 6, LP CDA is an equal opportunity provider