An Expanding Portfolio
of Investments
April 2019
IMPORTANT DISCLOSURES
No Offer. This material is being provided for information and discussion purposes only, is qualified in its entirety by the information included in the confidential offering documents of MG3 REIT, LLC (the “Fund”)and is not intended to be, nor should it be
construed or used as investment, tax or legal advice, any recommendation, or an offer to sell, or a solicitation of any offer to buy, an interest in any security, including an interest in the Fund or , any other private investment vehicle managed by MG3
Developer Group, LLC (the “Sponsor” or “MG3”), MG3 Fund GP, LLC (the “Manager”), the manager of the Fund, MG3 Advisors, LLC (the “Investment Manager”), a wholly-owned subsidiary of MG3, which provides asset and investment management
services to the Fund and a subsidiary Delaware limited partnership through which the Fund will own substantially all its assets (the “Operating Partnership” or “OP”), and/or any of their respective affiliates. Any offer or solicitation of an investment in the
Fund may be made only by delivery of the Fund’s Confidential Private Placement Memorandum (the “Memorandum”) to qualified investors. Prospective investors should rely solely on the Memorandum in making any investment decision. An investment in
the Fund is not suitable for all investors and includes substantial risk, including loss of principal. This presentation has not been prepared for any particular investor or client or necessarily for any particular type of investor or client.
No Guarantees. Any descriptions involving investment process, models, statistical analysis, investment strategies, and styles are provided for illustration purposes only, may not be fully indicative of future investments, and are not intended to reflect actual
performance or to project performance. Investments for the Fund are selected by, and will vary in the sole discretion of, the Investment Manager and are subject to availability and market conditions, among other things. No representation is made that the
Investment Manager’s or the Fund’s risk management, investment process or investment objectives will or are likely to be achieved or successful or that the Fund or any of its investments will make any profit or will not sustain losses.
Performance. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. The Fund has not commenced operations and has no operating history. Unless otherwise indicated, performance results are net of applicable fees and expenses and
presume reinvestment of income. No representation is made that the Fund or underlying investment will make any profit or will not sustain losses, including the full loss of investor principal. Fund portfolio allocations are selected by, and will vary in the sole
discretion of the Investment Manager and are subject to availability and market conditions, among other things.
Target Returns. Fund, portfolio or return targets or objectives are used for illustration, measurement or comparison purposes and only as an aid or guideline for prospective investors to evaluate a particular investment program’s investment strategies and
accompanying information. Such targets or objectives reflect subjective determinations by the Investment Manager based on a variety of factors, including, among others, investment strategy, prior performance of similar products and strategies (if any),
volatility measures, risk tolerance and market conditions. Performance may fluctuate, especially over short periods. Targeted returns should be evaluated over the time period indicated and not over shorter periods. Targeted returns are not intended to be
actual performance and should not be relied upon as an indication of actual or future performance.
Forward-Looking Statements. Any assumptions, assessments, intended targets, statements or the like (collectively, “Statements”) regarding future events or which are forward-looking constitute only subjective views, outlooks, estimations or intentions,
are based upon the Manager’s expectations, intentions or beliefs, should not be relied on, are subject to change due to a variety of factors, including fluctuating market conditions and economic factors, and involve inherent risks and uncertainties, both
general and specific, many of which cannot be predicted or quantified and are beyond the Investment Manager’s or the Fund’s control. Future evidence and actual results (including actual composition and investment characteristics of Fund portfolios) could
differ materially from those set forth in, contemplated by, or underlying these Statements. In light of these risks and uncertainties, there can be no assurance and no representation is given that these Statements are now or will prove to be accurate or
complete in any way. The Investment Manager undertakes no responsibility or obligation to revise or update such Statements.
Projections. Although the projections presented herein are presented with numerical specificity, these projections are not factual. The projections are based on variables and assumptions that were deemed to be reasonable as of the date when the
projections were finalized. These assumptions are inherently uncertain and may be beyond the control of the Manager, the Investment Manager or the Fund. Important factors that may affect actual results and cause the Fund to fail to meet the projections
include, but are not limited to, risks and uncertainties described or referenced under the section entitled “Risk Factors” in the certain Private Placement Memorandum of the Fund. There can be no assurance that the projections will be realized or that the
Fund’s future financial results will not materially vary from the projections. By including the projections in these materials, none of the Manager, the Investment Manager or the Fund make any representation to any person regarding the ultimate performance
of the Fund or that any projected results will be achieved.
Descriptions of Process. Any descriptions or information involving investment objectives or criteria, investment process, or investment strategies are provided for illustration purposes only, may not be fully applicable to the Fund, may not be fully indicative
of any present or future investments, may be changed in the discretion of the Manager or its affiliates and are not intended to reflect actual performance or to project performance.
Risks. This information is as of the date(s) indicated, is not complete, is subject to change, and does not contain material information regarding the Fund, including specific information relating to an investment in the Fund and related important risk
disclosures. Before making any investment, an investor should thoroughly review the Memorandum to determine whether an investment is suitable for such investor. An investment in the Fund may involve a high degree of risk and volatility including,
without limitation, risk of adverse or unanticipated market developments, currency and exchange rate risks, risk of broker or bank failure or counterparty or issuer default, and risk of illiquidity.
Information from Third Parties. Certain information has been provided by and/or is based on third party sources and although believed to be reliable has not been independently verified and its accuracy, timeliness or completeness cannot be
guaranteed.
Confidentiality. This information is confidential, is the property of the Investment Manager, is intended only for intended recipients and their authorized agents or representatives and may not be distributed to any other person without our prior
written consent.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 2
WHAT IS A REIT?
A REIT is a “real estate investment trust”. A REIT is a company that qualifies for special treatment for federal income tax purposes because it
derives most of its income from real estate-based sources and makes a special election under the Internal Revenue Code. The Fund intends to
operate as a REIT.
A corporation that qualifies as a REIT generally is not subject to federal corporate income taxes on its income and gains that it distributes to its
stockholders, substantially eliminating the “double taxation” of corporate income.
Qualified business income distributed by a REIT to its shareholders is eligible for the 20% “passthrough deduction” under section 199A of the
Internal Revenue Code. The passthrough deduction reduces the maximum federal income tax rate applicable to individual shareholders on this
income from 37% to 29.6% (not taking into account the 3.8% surtax on net investment income).
Invest in Shares Acquisitions and/or
Capital Investments
REITs
Investors Distributions Rental Income from Assets
Tenant Rents or
Interest Payment
Description of REIT investment process is provided for illustration purposes only. This illustration may not be fully indicative of any present or future investment of the Fund. 3
Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
RECURRING CASH FLOW POTENTIAL
Potential for recurring cash flow, Equally important, REITs may
also be a suitable choice for
appreciation, and intrinsic value - all investors seeking:
wrapped into one. Capital Preservation
Real estate is one of the few investments that may provide recurring Expected Monthly Income
cash flow and appreciation potential while being historically less volatile
than other assets such as public equities. Growth Potential
The potential recurring cash flow is expected to come from leases, which
depending on the asset class, can be long-term contracts creating the
potential a source of predictable income. Pair that with the potential
appreciation from rents and land values increasing over time, and the
underlying value of the raw materials with which properties are built, and
you’ve got an investment that may deliver a compelling combination of
return and risk.
There can be no guarantee that historical trends will continue and a change in such trends is likely to significantly impact the performance of the Fund and its underlying investments. Past performance is not indicative of future results. 4
Please see “Important Disclosures” for more information
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
POTENTIAL BENEFITS OF INVESTING IN THE FUND
Seek to generate secure Advantages Redemption Program
income by long-leases (1) of the Fund
Professional
Portfolio Management
Diversification
Potential Tax Advantages
Audited Financials
(1) Depending on the assets class.. 5
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
COMPANY Since 2003, MG3 has developed
BACKGROUND
34 38,000 2,250,000 $540M
educational projects Student stations Square feet Assets under
throughout Florida management
MG3 Developer Group, LLC (“MG3”) Our strategy of specializing in educational projects complements
our planned future diversification across our key segments.
A vertically integrated private real estate
company with expertise in investment Our strategy may allow us to develop greater depth of knowledge in
management, property management, our chosen segments while still benefiting from portfolio diversity
development, design, construction, leasing, and attempt to limit investment down-side in the case of recession.
and financing.
MG3 has developed schools, multifamily, high-end single-family
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved gated communities, governmental DEA facilities, luxury single-
family homes, office buildings and assisted living facilities.
6
SENIOR LEADERSHIP
MARCELO SAIEGH GUSTAVO BOGOMOLNI HERNÁN LEONOFF
Principal Principal and Certified General Contractor Principal
Marcelo Saiegh facilitates company growth by overseeing Gustavo Bogomolni leads all MG3 development and construction Hernán Leonoff has extensive experience in real estate investment,
the fiscal health of MG3. With a strong background in commercial projects and during his tenure with the company has overseen the management, market analysis and business development.
finance, he provides strategic and financial leadership to the execution of over $700 million in construction projects, ranging
organization through the oversight and development His broad scope of responsibilities for MG3 includes the
of the accounting, tax, financial reporting and analysis, zfrom ground-up development and value creation to customized management of new investment initiatives, execution of real estate
and treasury functions. transactions, and expanding the company’s investment platform
tenant interiors. through acquisitions, as well as the strategy, sourcing, analysis
Marcelo also provides strategic leadership and management and development of new opportunities.
support to the company’s information technology department, He is responsible for business planning, budgeting and operational
and co-leads re-development and expansion initiatives activities, and is the pre-planning and pre-construction lead, Hernán supervises the management of existing properties,
for existing portfolios. responsible for complete delivery chain management. oversees operations, including funding new developments
and lease renewals for existing and new assets, and co-leads
Prior to joining MG3, Marcelo led one of the most successful He reviews all capital construction projects for MG3’s portfolio re-development and expansion initiatives for existing portfolios.
textile companies in Argentina and spent more than decade in of assets. Prior to joining MG3, he led one of Argentina’s most In addition to his real estate investment experience,
real estate investment. prominent custom home construction firms, managing the full Hernán is part of long line of entrepreneurs, who built one
development process, from land acquisition to construction to of the largest and most renowned chain of retail optical stores
He earned his degree in Marketing and Business Administration sales, and was in charge of the construction of more than 800 in Argentina over four generations.
from ORT in Argentina. single-family homes and five condominium developments.
From an early age, he was involved in all aspects of the family
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved He earned his degree in Construction Engineering from business and has played a critical role in maintaining and growing
Universidad Tecnólogica Nacional, and his degree in Marketing the family legacy.
from ORT, both in Argentina. Gustavo is a Certified General
Contractor with the State of Florida. 7
Public Charter
Schools
DRIVEN BY PARENTAL DEMAND FOR CHOICE
OVER 20 YEARS OLD AND GROWING STRONG
Started in 1992 NUMBER OF PUBLIC CHARTER SCHOOLS
Currently adopted in 44 states and D.C.
3.2M students growing at 12% CAGR 8,000
7,000 schools growing at 7% CAGR 6,000
Waiting list of over 1M students 4,000
2,000
0
NUMBER OF PUBLIC CHARTER SCHOOL STUDENTS
3,000,000
2,000,000
1,000,000
0
Source: NAPCS National Alliance for Public Charter Schools 9
There can be no guarantee that historical trends will continue and a change in such trends is likely to significantly impact the performance of the Fund and its underlying investments. Past performance is not indicative of future results.
Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
SCHOOL CHOICE FAMILY PROFILE
Parents who want an 10
alternative to traditional
public schools drive
demand for Charter
Schools
Improves Academic Outcomes
and Saves Taxpayers Money (1)
(1) Source Foundation for Economic Education.
There can be no guarantee that historical trends will continue and a change in such trends is likely to significantly impact the performance of the Fund and its underlying investments. Past performance is not indicative of future results.
Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
Charter School
Trends
CHARTER SCHOOL TRENDS
Number of Schools Number of Students
7000 3.5
6000 3 Number of Students (Millions)
Number of Schools 5000 2.5
4000 2
Approximately 3.2 million students now attend 3000 1.5
public charter schools, more than 5.82%
of the total number enrolled in public schools. (1) 2000 1
More than 1 million student names 1000 0.5
are on charter school waiting lists. (1)
00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
(1) Source: NAPCS National Alliance for Public Charter Schools
There can be no guarantee that historical trends will continue and a change in such trends is likely to significantly impact the performance of the Fund and its underlying investments. Past performance is not indicative of future results.
Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 12
CHARTER SCHOOL TRENDS
If current trends continue, charter schools will Numbers of New Schools Opened, by State (2011-2017)
educate 20-40 percent of all U.S. public school
students by 2035 700
High 38% Moderate 27% Low 22% 600 590
25
500
20
10 400 364
5 297
300
Current
Levels 252
0 200 165
142
2005 2010 2025 2020 2025 2030 2035 115 113
100 81 81 73 66 61 57 54 50 43 42 40 37 34 33 32 29 25 30
0
Source: Analysis conducted by Neerav Kingsland Source: NAPCS National Alliance for Public Charter Schools
There can be no guarantee that historical trends will continue and a change in such trends is likely to significantly impact the performance of the Fund and its underlying investments. Past performance is not indicative of future results.
Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 13
CHARTER SCHOOL TRENDS
Number of New Public Charter Schools & Students
Florida PK-12 Enrollment in Charter Schools 2016-2017
350000 State New Charter Schools Additional Students
California 65 31,515
300000 295,814 Texas 47 33,710
250000 283,755 Florida 36 21,140
270,974 Arizona 20 1,880
New York 16 14,100
251,282 Colorado 15 6,035
Louisiana 10 3,208
229,428 Arkansas 9 846
200000 203,240
179,940
154,780
150000 137,196
117,040
100000
Tennessee 9 9,867
50000
Utah 9 3,740
0 North Carolina 7 13,637
2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18
Source: Florida Department of Education Source: NAPCS National Alliance for Public Charter Schools
There can be no guarantee that historical trends will continue and a change in such trends is likely to significantly impact the performance of the Fund and its underlying investments. Past performance is not indicative of future results.
Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 14
Portfolio
Information provided in this section with respect to the Portfolio Properties indicated herein are
current as of March 31, 2019. The information provided herein is for illustration purposes only,
may not represent all investments that were made by the Fund, may not be fully indicative of
future investments of the Fund, and are not intended to reflect actual performance or to project
performance. Additionally, there can be no guarantee that similar investment opportunities will be
available in the future, or that, if available, the MG3, the Manager, the Investment Manager, or
the Fund will be able to take advantage of such opportunities. It should not be assumed that
investments made in the future will be comparable in quality or performance to the investment
described herein. Past performance is not indicative of future results. Please see “Important
Disclosures” for more information.
PORTFOLIO
Bell Creek 13221 Boyette Rd. | Riverview, FL 33569
Academy
Total lot size Rentable building area
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved ±10.22 acres 73,197 SF
16
PORTFOLIO
Hillsborough 9659 W. Waters Ave | Tampa, FL 33635
Academy of Math
and Science Total lot size Rentable building area
±9.2 acres 54,778 SF
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
17
PORTFOLIO
Everglades 2251 E Mowry Drive | Homestead, FL 33033
Preparatory
Academy Total lot size Rentable building area
±10.62 acres 74,196 SF
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
18
PORTFOLIO
Avant Garde 2025 McKinley St. | Hollywood, FL 33020
Academy Broward
Total lot size Rentable building area
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved ±10.6 acres 122,175 SF
19
PORTFOLIO
Orange County 10250 University Dr. | Orlando , FL 32817
Prep Academy
Total lot size Rentable building area
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved ±9.75 acres 67,663 SF
20
PORTFOLIO
Bridge Prep 6309 S. US Highway 301 | Riverview, FL 33578
Academy of
Riverview Total lot size Rentable building area
±13.1 acres 95,469 SF
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
21
PORTFOLIO
Bridge Prep 5710 La Costa Dr. | Orlando, FL 32807
Academy Orange
County, Inc Total lot size Rentable building area
±4.60 acres 29,540 SF
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
22
PORTFOLIO
Bridge Prep 6400 Atlantic Blvd. | Jacksonville, FL 32211
Academy of Duval
Total lot size Rentable building area
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved ±10.0 acres 103,070 SF
23
PORTFOLIO
Bridge 3161 Santa Barbara Blvd. | Naples, FL 34116
Prep Academy
of Collier Total lot size Rentable building area
±12.80 acres 40,386 SF
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
24
PORTFOLIO
Change 1725 N. Commerce Parkway | Weston, FL
Healthcare Weston
Headquarters Total lot size Rentable building area Parking Spaces
±6.53 acres 52,960 SF 250
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
25
Development
Team Experience
Properties referenced herein represent completed development projects in which MG3 or an
affiliate thereof invested, developed or re-developed. Such properties may include Portfolio
Properties of the Fund as well as investments that are not and will not be investments of the
Fund. MG3’s past projects serve to demonstrate the prior experience of MG3’s team. The
information provided herein is for illustration purposes only, may not be fully indicative of
future investments of the Fund, and is not intended to reflect actual performance or to project
performance or results. Additionally, there can be no guarantee that similar investment
opportunities will be available in the future, or that, if available, the MG3, the Manager, the
Investment Manager, or the Fund will be able to take advantage of such opportunities. It
should not be assumed that investments made in the future will be comparable in quality or
performance to the investments described herein. Past performance is not indicative of
future results. Please see “Important Disclosures” for more information.
DEVELOPMENT TEAM EXPERIENCE Sarasota School
of Arts Sarasota, FL
Imagine School at
Boynton Beach, FL
Imagine School at Renaissance Charter
Broward Coral School at Cooper
Springs, FL City, FL
Renaissance Charter Renaissance
School at Coral Charter School
Springs, FL at Plantation, FL
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 27
DEVELOPMENT TEAM EXPERIENCE International
Bachelorette School
Renaissance Charter at Tampa
School at Tamarac, FL
Kids Community Championship
College at Academy of Distintion
Tampa, FL Davie, FL
Pinellas Academy Miami Arts Charter
of Math and Science School Homestead, FL
Largo, FL
28
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
DEVELOPMENT TEAM EXPERIENCE Independence
Academy Charter
Renaissance School Tampa, FL
Charter School &
Bright Horizons Day Bridge Prep Academy
Care Wellington, FL at Palm Beach, FL
Renaissance Charter Independence 29
School at Central Academy Charter
Palm, FL School Tampa, FL
Renaissance Charter
School at Goldenrod
Orlando, FL
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved
DEVELOPMENT TEAM EXPERIENCE Residence Golden
Beach, FL
Miami Arts Charter
School Wynwood
Miami, FL
Toras Emes Academy Residence Golden
of Miami, FL Beach, FL
Yeshiva Toras Chaim Residence Golden
North Miami Beach, FL Beach, FL
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 30
DEVELOPMENT TEAM EXPERIENCE
Havana Towers Miami, FL Assisted Living Facility at Davie, FL The Preserve at Emerald Hills
Hollywood, FL
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 31
INVESTMENT STRUCTURE
Investors
OP General Partner
LLC LLC LLC
1 2 3
Real Estate Real Estate Real Estate
The Fund has not yet held its initial closing. The structure and terms of the Fund are subject to further change.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 32
NEW TAX ACT MAY PROVIDE SUBSTANTIAL TAX SAVINGS
TO FUND INVESTORS SHAREHOLDERS
The Tax Cuts and Jobs Act (TCJA) Comparison of Investment in Rental Real
provides substantial potential tax savings Estate through a Partnership vs. a REIT
to REIT investors.
Example REIT investment Investment in a Partnership Investments in a REIT
With Rental Real Estate
Investment $100,000 $100,000
Qualified business income distributed by a REIT to its Pre-Tax Ordinary $7,000 $7,000
shareholders is eligible for the 20% “passthrough deduction” Distribution 37.0% 29.6%
under section 199A of the Internal Revenue Code. The Effective Income $2,590 $2,072
passthrough deduction reduces the maximum federal Tax Rate $4,410 $4,928
income tax rate applicable to individual shareholders on this
Tax
After Tax Income
income from 37% to 29.6% (not taking into account the 3.8% After Tax Yield 4.4% 4.93%
surtax on net investment income). Please check with your individual advisor to determine how your individual tax profile is affected
The hypothetical does not take into account the 3.8% Medicare tax on net investment income or any
applicable state and local taxes
*REIT investments included in the TCJA definition of qualified business income, with qualified cooperative
dividends and qualified publicly traded partnership income specifically identified
The hypothetical example presented and any description of process are provided for illustration purposes only, may not be fully applicable to the Fund, may not be fully indicative of any present or future results of an investment in the Fund, may be changed
without notice and will be outside the control of MG3, the Manager, the Investment Manager, the Fund and their respective affiliates. Accordingly, investors should not place undue reliance on this illustrative example as an indicator of current or future
economic results or value to the Fund. Past performance is not indicative of future results. Please see “Important Disclosures” for more information.
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved 33
2980 NE 207th Street, Suite 603, Aventura, Florida 33180 [email protected]
(954) 929 5229 www.mg3reit.com
(954) 929 5226
34
Copyright © MG3 Developer Group LLC. 2019. All Rights Reserved