Market Overview

Dalzell Capital Partners Adds Four Center City Properties to Its Growing Philadelphia Portfolio

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Portfolio Acquisition Follows Firm's $21 Million Purchase of Waverly
Court on June 28, 2018

Dalzell Capital Partners LLC ("Dalzell Capital"), a real estate
investment and management firm, today announced that it acquired a
four-property multifamily portfolio located in Center City, Philadelphia
for $18.7 million (the "Portfolio"). The Portfolio was purchased from
Philadelphia-based commercial real estate developer Alterra Property
Group.

"Dalzell Capital's continued investment in Center City demonstrates our
positive long-term outlook on Philadelphia, which is enjoying an
accelerating economic expansion," said Christian Dalzell, Dalzell
Capital's Managing Partner. "The rare opportunity to expand our
footprint across Center City through the acquisition of four outstanding
properties at an attractive valuation is something we are extremely
excited about."

The luxury portfolio consists of four newly built or recently
gut-renovated properties aggregating 65 units that offer Dalzell Capital
the opportunity to create incremental value through operational and
capital improvements. With an average Walk Score of 99, the Portfolio
will benefit from its proximity to almost 400,000 jobs in Center City
and University City, Philadelphia's extensive local, regional and
national transportation network, and significant complementary
commercial property development activity. The Portfolio is comprised of
the following assets:

  • The Bradford – Located at 507 South 8th Street between Lombard
    and South Streets, The Bradford was delivered in 2017 and quickly
    leased up to full occupancy. The 26-unit property offers high-end
    materials, premium appliances and fixtures including Nest in all
    units, covered parking, a green roof, an enclosed dog run, and an
    outdoor tenant lounge with community BBQ.
  • Queen Village Lofts – Located at 427 Monroe Street,
    approximately four years ago, the property was gut renovated and
    converted from a school into a 16-unit, high-end contemporary
    multifamily property that features beautiful millwork, modern kitchens
    and bathrooms, secure access, washer and dryers in each unit, secure
    parking, and a rooftop deck with 360 degree views of Philadelphia.
    Queen Village Lofts sits one street south of Bainbridge Green and
    directly across the street from the Elizabeth Elementary School, which
    is considered one of the best public elementary schools in
    Philadelphia.
  • 1311 Spruce – Located at 1311 Spruce Street, the property was
    originally built as a law office. In 2013, 1311 Spruce was converted
    and expanded into the beautiful urban multifamily property that it is
    today. The property's 16 one- and two-bedroom units feature modern
    kitchens and appliances, granite counters, subway tile backsplashes,
    new bathrooms, washer and dryer in each unit, and hardwood floors
    throughout the property.
  • 1310 Spruce – Located at 1310 Spruce Street (directly across
    the street from 1311 Spruce), the property was redeveloped in 2014 and
    includes seven units featuring modern kitchens, appliances and
    bathrooms. Located on Spruce between Broad and 13th
    Streets, both 1311 Spruce and 1310 Spruce are great destinations for
    the urban living experience, with restaurants, theaters, galleries and
    boutiques all within walking distance.

The portfolio transaction advances Dalzell Capital's strategy of
acquiring assets in fundamentally strong and densely populated urban
markets that have the potential to deliver stable cash flows and
outsized value-add returns. It also gives Dalzell Capital increased
scale in Center City, the largest job center in the Philadelphia MSA due
to its large concentration of employers in the education, health and
life science industries. With 71 percent of Core Center City residents
having a bachelor's degree or higher, national and local businesses are
capitalizing on the area's educated, skilled workforce.1

On June 27th, 2018, Dalzell Capital acquired
Waverly Court, a 62-unit mixed-use property located in Center City that
features 61 loft-style apartments and a 2,800 square feet commercial
unit leased to Amis Trattoria, for $21 million. As a result of the
acquisition of the Portfolio, over the past 12 months Dalzell Capital
has assembled a portfolio of seven high-quality mixed-use and
multifamily properties totaling 192 units and 8,500 square feet of
commercial space. All properties are tightly clustered in Center City,
and are poised to benefit from the area's continued economic expansion.
Having deployed approximately $65 million in Center City since August
10, 2017, Dalzell Capital expects to continue to pursue additional
value-add and opportunistic transactions in targeted submarkets across
Center City and University City.

About Dalzell Capital Partners LLC

Led by real estate industry veteran Christian Dalzell, Dalzell Capital
Partners LLC is a privately-owned investment and management firm formed
in late 2016. Since its founding, Dalzell Capital has completed 12
investments – nine controlling and three non-controlling investments –
totaling approximately $195 million in gross value. Mr. Dalzell,
formerly a senior executive with Starwood Capital Group Global, L.P.,
Eastdil Secured and Banc of America Securities LLC, has extensive
commercial real estate, private equity and investment banking
experience. During his 22-year career, Mr. Dalzell has closed more than
500 transactions globally, aggregating more than $62 billion as a
lender, intermediary and investor. Dalzell Capital Partners is
headquartered in Westport, Conn.

1 Center Philadelphia Development Corporation, 2018 State of
Center City Philadelphia report
https://centercityphila.org/uploads/attachments/cjh25azq7002ollqdi58lpuer-socc-2018-final-web.pdf

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