OUR INVESTMENT THESIS

By adhering to our principles, we consistently create value.

CYCLE RESISTANT

WHY IT MATTERS

Boom-and-bust cycles and black-swan events are a reality.

Black Swan Events

The Dot-Com bust, the Great Recession, Covid-19 — black swan events are part of our reality.

Market Cycles

Market downturns, also a reality, are triggered by black swan events or factors like inflation which increases borrowing and operating costs.

HOW WE DO IT

We focus on value and capital-efficiency while building a desirable product backed by secular demand.

1

Structural Undersupply

California's RHNA goals require 2.5M housing units by 2030, of which 421K are within the moderate-income category we target.
Source: 'A Home for Every Californian': 2022 Statewide Housing Plan by the California Department of Housing and Community Development, March 2022: - Visit

2

Stable Resident

Our resident base is stable, with an average credit score of 690.

3

Focus on Cost Basis

We consistently focus on buying at an attractive cost-basis. With $850B of multifamily mortgage expirations from 2023-26, we see attractive buying opportunities.

4

Build Value

By providing a desirable product that yields higher rents at lower cost per square foot, we are better cushioned against market cycles.

5

Conservative Underwriting

We stay true to our underwriting discipline: attractive basis, stress-tested assumptions, low leverage, and discounted agency loans.

Focus on Resident Experience

WHY IT MATTERS

Design, function and affordability should not be mutually exclusive.

Location is Everything

Middle-income professionals are often forced to sacrifice the conveniences of an urban location for lower rent.

Quality of Housing

A convenient location can mean living in aging, rent-controlled housing with poor construction and design.

Rental Buden

The rent burden of our target resident, whose discretionary income is only ~$40 a day, affects their quality of life.

HOW WE DO IT

We create a premium resident experience by providing features that matter, choosing great locations, and streamlining operations.

1

Desirable Location

We reduce our residents' cost of living by locating properties near transit, urban amenities, and job centers.

2

Build What Residents Want

Our design-conscious buildings feature premium unit finishes and upgraded common areas, fully satisfying our residents' mental checklist of features.

3

Tradeoff Space for Price

Our residents are willing to trade some square footage for location, design, amenities and lower rents.

4

Seamless Leasing & Operations

Our virtual tours and leasing, AI property management tools, and keyless entry reduce operations cost and provide a seamless resident experience.

5

Improved Energy Efficiency

Upgraded utilities and solar power systems tap into Inflation Reduction Act rebates and credits of up to $14,000 per unit while offsetting 50-120% of the building's energy usage for resident and investor benefit.

Develop Efficiently and Quickly

WHY IT MATTERS

Faster turns of capital result in higher returns.

Cost of Construction

Lower construction costs allow us to maintain margins while offering more amenities at lower rents. Our cost per residence is $250K vs. $570K (Bay Area average).

Time to Deployment

The faster a building can be built and deployed, the sooner it starts giving a return on investment. Our timeline from acquisition to operation is 30 months vs. 72 months (SF average).

HOW WE DO IT

We optimize our design, entitlements and construction processes to compress timelines, while adding density.

1

Optimized Site
Selection

We target sites and buildings with value-add potential. This includes feasibility of adding solar, and potential to increase rentable area by adding units (ADUs).

2

Real Estate
is Local

We get to market quickly by investing in markets we know well or partnering with trusted, reputable operators in new geographies.

3

Standardized Designs

We are experts at building standardized small format housing. Standardization compresses timelines and lowers costs, allowing a faster turn of capital.

4

Densification with ADUs

We leverage California's new Accessory Dwelling Unit (ADU) laws, which enable up to a 25% unit count increase by right. Using ADUs to add density drives efficiency by increasing rentable inventory at lower cost.

5

Optimized
Entitlements

We leverage state laws to expedite the permitting process and bypass local control where possible, which accelerates development timelines while lowering fees.

STRONG CASH FLOW

WHY IT MATTERS

Cash flow generation potential is an investment risk mitigation factor.

High Interest Rate Environment

In the current high interest rate environment, investors are looking for income generation opportunities with an upside.

High Inflation

In an inflationary environment, investors are looking for yields that beat inflation.

HOW WE DO IT

We look for assets with cash flow generation potential and make improvements that drive NOI.

1

Strategic
Acquisitions

We acquire distressed assets with strong fundamentals in areas with an underserved demographic, undersupply of affordable housing and densification potential.

2

Lower Cost of
Capital

Our borrowing history, middle-income housing focus, and affordable projects qualify us for agency loan discounts.

3

Experts at Leveraging
Legislation

We leverage the Inflation Reduction Act and state densification legislation to increase rental yield and property-level equity multiples.

4

Value-Add
Improvements

Our value-creation process efficiently upgrades building infrastructure and operations with a demonstrated ~75% increase in project-level net operating income in a market-neutral environment.

5

Increased
Rental Yield

Honed over 20 years of expertise, our creative unit designs utilize space effectively, enabling increased density within a property. We also use CA's new ADU laws to add units, which increases rentable square footage cost-efficiently.

6

Conservative Leverage &
Timed Exit

We maintain low leverage and monitor the market closely to exit at the right time.

Create Impact

WHY IT MATTERS

Transit-oriented, design-conscious and energy-efficient projects that are accessibly priced are good for the environment, and for society.

Bay Area Housing Crisis

With a shortfall of 408,000 units, housing supply for middle-income professionals massively lags behind demand.
Source: SPUR 'Housing as Infrastructure' Report, April 2021: Download PDF

Mitigating Climate Change

Nearly 22% of total U.S. energy consumption in 2022 was by the residential sector. When homes are energy efficient, their total energy consumption goes down.
Source: U.S. Energy Information Administration: - Download PDF

Right Thing To Do

A home to love, for the life you want, without breaking the bank — that is our promise to the urban American workforce.

HOW WE DO IT

We create energy-efficient middle-income housing by leveraging government legislation to reduce costs.

1

Increased Density Per Square Foot

By using efficient design and adding ADUs, we can increase property NOI by ~25%.

2

Energy Efficiency Upgrades

We install new solar energy systems, low-flow fixtures and new greywater systems by leveraging the IRA legislation's rebates and credits that cover 50-100% of upgrade costs.

3

Increased Affordability Index

Our buildings are twice as affordable as the national average and accessibly priced for the middle-income segment.

4

Construction That Reduces Emissions

Our buildings are wood-frame construction vs. concrete and steel, and 100% electric vs. gas, resulting in lower carbon emissions.

5

Enabling Sustainable Transport

Transit, walk, and bike scores for our newer buildings are 50-80% better than the national urban average.


Fund Safe Harbor
Riaz Capital Fund V, LP - Distressed Value-Add Fund is offering securities under Rule 506(c) of Regulation D “Investment” to accredited investors. Nothing in this advertisement constitutes an offer to sell or the solicitation of an offer to purchase securities or an interest in the partnership. Any such offer or solicitation may only be made by means of delivery of the Partnership Agreement, Subscription Agreement, and Private Placement Memorandum which will contain material information not included herein and shall supersede, amend and supplement this presentation in its entirety.

This advertisement is provided for informational purposes only and is intended solely for the person to whom it is delivered. This advertisement is to be used only in connection with recipient’s consideration of an investment with Riaz Capital. This presentation is confidential and may not be reproduced or distributed without the express written consent of Riaz Capital. By receipt of the enclosed material and information, the recipient agrees that this confidential information will be permanently kept confidential and will not be used in whole or in part for any purpose other than evaluating the Investment.

In addition to information about the securities, this website may contain forward-looking statements and information relating to, among other things, the company, its business plan and strategy, and its industry. Any operational projections or financial projections or returns shown on this website are estimated predictions only, are hypothetical, are not based on actual investment results and are not guarantees of future results or actions. Estimated projections do not represent or guarantee the actual results of any transaction, and no representation is made that any transaction will, or is likely to, achieve results or profits similar to those shown. In addition, other financial metrics and calculations shown on this website (including historical returns paid) have not been independently verified or audited and may differ from the actual financial metrics and calculations for any investment. Any investment information contained herein has been secured from sources that Riaz Capital believes are reliable, but we make no representations or warranties as to the accuracy of such information and accept no liability therefor. Nothing on this website should be interpreted to state or imply that past results are an indication of future performance.

It is advised that you consult an investment advisor, legal advisor, and tax professional to fully understand any potential implications before making an investment in the partnership.

Regulatory Risk
The information contained herein is not directed to any person who is not believed to qualify under the definition of an Accredited Investor under the rules of Regulation D of the 1933 Securities and Exchange Act. The Riaz Capital Fund V, LP - Distressed Value-Add Fund securities are not registered and are offered in reliance of an exemption from registration. Neither FINRA, the SEC, nor any other securities regulator have approved of any of these securities.

Investment Risk
Investments made under Regulation D involve a high degree of risk and those investors who cannot afford to lose their entire investment should not invest. Investors may lose all or a substantial portion of their investment.

An investment in the partnership involves significant risks and investors should have the financial ability and willingness to accept the risk characteristics of the Investment. Investors should review the Partnership Agreement and Private Placement Memorandum, conduct such investigations and evaluation as they deem necessary or appropriate and consult their own legal, accounting, tax and other advisors in order to make an independent determination of the suitability and consequences of the Investment.

Further, these securities not listed on any exchange. A secondary market for these securities does not currently exist and may never develop. Investors should not purchase these securities with the expectation that a market eventually will develop. Further, even if a market did exist or develop, the securities have significant restrictions on their transferability.

Performance
This advertisement may contain forward-looking statements and information relating to, among other things, the company, its business plan and strategy, and its industry. Any operational projections or financial projections or returns shown on this presentation are estimated predictions only, are hypothetical, are not based on actual investment results and are not guarantees of future results or actions. Estimated projections do not represent or guarantee the actual results of any transaction, and no representation is made that any transaction will, or is likely to, achieve results or profits similar to those shown.

Performance of the Investment may be volatile, and investors may experience results that differ materially from those shown herein. There can be no assurance that estimated returns or any projections set forth in this presentation will be realized or that actual returns or results will not be materially different than those estimated herein.

In addition, other financial metrics and calculations shown on this presentation (including historical returns paid) have not been independently verified or audited and may differ from the actual financial metrics and calculations for any investment. Any investment information contained herein has been secured from sources that Riaz Capital believes are reliable, but we make no representations or warranties as to the accuracy of such information and accept no liability therefor. Nothing on this presentation should be interpreted to state or imply that past results are an indication of future performance.

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