Commercial Acquisition - Selected Acquisition Investment

Project: Centre Park I & II Location : Columbia, Maryland Project Description: Centre Park I & II is a 67,000 square foot Class B office/retail project.

Transaction Summary:

In 1996, JPB Enterprise's real estate group acquired Centre Park I & II. The project was viewed as an under performing asset in a fast growing market. With an exhaustive due diligence process, JPBE identified several areas where its full breadth of services would help the project realize maximum profitability. Specifically the real estate group found the following opportunities:

• Neglected tenant/client value;
• Short-term roll over with below market rates;
• Broadening market pull resulting from future road infrastructure enhancements;
• Creative financing opportunities;
• Exorbitant vendor agreements; and
• In-house leasing to reduce marketing expenses.

Outcome:

The project provided JPBE with cash on cash returns of 16%. In October of 2002, JPBE sold the project to a regional investor. After closing costs, JPBE realized a 25% Internal Rate of Return. JPBE has achieved higher returns on other real estate investments, but this transaction reflected how a thorough understanding of the regional real estate market, combined with value added real estate services allowed the company to acquire a product that appeared over priced at the time of acquisition and to make a return on investment much higher than traditionally achieved in the marketplace.