PRELIMINARY BUILDERS SUMMARY

PRELIMINARY BUILDERS SUMMARY

Presented by:

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LAGRANGE, GEORGIA 30240

January 1, 2007

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ee||ääxxÜÜ bbtt~~áá ESTATES Valley, Chambers County, Alabama

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RIVER OAKS ESTATES is a 227 unit residential subdivision situated on an approximately 90 acre

parcel of woodland located on the south bank of the Chatahoochee River in the City of Valley, Chambers County, Alabama. The Project has been designed to allow Builder’s to develop homes within a pricing range of $135,000 to $300,000 or more. The Project’s 186 single family home lots range from 8,000 square feet to upwards of 25,000 square feet. A 6.8± acre multi-family home site designed for 41 Townhouse style “condominium” homes is also available.

Valley is a residential community of 9,000± people situated on the southwest bank of the

Chattahoochee River in northern Chambers County, Alabama, approximately mid-way between Atlanta, Georgia and Montgomery, Alabama. Straddling U.S. Interstate Highway 85 approximately 80 miles southwest of Atlanta, the City is approximately 28 miles north of Columbus, Georgia, 18 miles southwest of LaGrange, Georgia and approximately 4½ miles southwest of West Point, Georgia—the community selected by Hyundai-Kia Motors as the site for the Kia Motors’ first US automobile assembly plant, an approximately $1.2 Billion, 5,000,000 square foot manufacturing facility now under construction on a 2,150± acre parcel of land purchased for Hyundai-Kia by the State of Georgia during the early spring of 2006. With this, and the development of manufacturing facilities on the same and nearby sites in Georgia and Alabama by 6 of Kia’s primary parts suppliers, employment in the Valley-West Point region is expected to balloon by nearly 9,000 core manufacturing jobs in the next 36 to 60 months. As each core manufacturing position typically generates another 1.8 jobs in supporting and services industries, total employment growth in the area is expected to exceed 25,000 jobs. This, plus the major expansion of nearby Ft. Benning, Georgia, due to the redeployment of units there as a result of the Department of Defense’s on-going “Base Realignment and Closure” program (“BRAC”); and, the major expansion of nearby Auburn University’s College of Engineering with the opening of the Shelby Center for Engineering Technology, are giving rise to a major population expansion in the area. Accordingly, demand for affordable housing and commercial and retail space the Valley-West Point region is expected to increase rapidly during the next 2 to 4 years (For additional information on Kia on the internet please see http://www.kia.com/031306.php. Additional information on Auburn’s Shelby Center is available at http://www.ocm.auburn.edu/au_report/072406aur.pdf).)

Located in Chambers County, in East Central Alabama, the City of Valley is situated on the southwest bank of the Chattahoochee River, at the Alabama/Georgia State border.

ee||ääxxÜÜ bbtt~~áá ESTATES

Valley Central Business District

2,150 ACRE KIA MOTORS MANUFACTURING

CAMPUS

e|äxÜ bt~á ESTATES Valley, Chambers County, Alabama

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Aerial View of the Property

The River Oaks site is a parcel of vacant woodland fronting on the southwestern bank of the Chattahoochee River and bounded to the west by US Interstate Highway 85. The site is dominated by two small hillocks but generally slopes downward to the River in a northerly and northeasterly direction and is easily visible from the highway bridge connecting Valley and Harris County, Georgia.

The site is in an unincorporated portion of Chambers County, on the northernmost boundary of the City of Valley, and will be annexed into the City during the construction of the Site improvements.

The Site is bordered on the south and east by an older, upper middle income, single-family home neighborhood that provides several access roads to the Property and convenient access to I-85 and State Highway 29. The Project has been well received by the community and Valley City Officials are so strongly in favor of it that the City made an unsolicited offer to widen and improve the principal access roads to the Site with new streetlights, curbs and gutters—at no cost to the River Oaks Partners—during the Project Entitlement process.

A major attribute of the Site is its proximity to the Kia Motors Assembly Plant site, only 4½ miles north of the Property on I-85. With this, yet siginificantly lower taxes, the project has a significant competitive advantage over new home developments in Georgia. The site is also within easy commuting distance of major employment centers in Opelika and Auburn, 20± minutes away and Columbus, less than 30 minutes away.

Aerial View of the Property with Plat Map Overlay

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Harris County Georgia

e|äxÜ bt~á BOUNDARIES

Harris County Georgia


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Condominium Lots

Typical 75’ Wide, 12,000 SF Lots

20,000+ SF Estate Lots

Community “River Walk” along the River Bank

Typical 75’ Wide, 9,200 SF Lots with River Valley Views

Typical 80’ Wide, 12,000 SF Lots

Nature Preserve Area

Nature Preserve Area cÄtà `tÑ

Note: This Plan is Preliminary and Subject to Change. Copies of the Site Development Plans are available to qualified Builders on request.


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The Site viewed from the I-85 Bridge over the Chattahoochee River (above and below). Because of the dense foliage, this is somewhat difficult to photograph, however, once the Site improvement work begins, the Project will be easily seen from the distance of the Freeway Bridge.

Views of the River from the Property taken during the late Fall to illustrate the views that homebuyer’s will have from their homes once the existing foliage is thinned somewhat during the Site Development work. Note, however, that every effort is being made to preserve as much of the natural beauty of the Site as possible. Nature trails meander through the site and a “River Walk” along the riverbank spans the entire site linking it to a similar walking trail planned by the City of Valley.


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The homes and streets in the Neighborhood adjoining the Property are generally tidy and well maintained. Noticeably, the streets in the surrounding neighborhood area not currently improved with curbs and gutters, nor, in most cases, with Street Lighting. However, as an inducement for the project, the City of Valley has volunteered to widen and improve the Streets leading to River Oaks Estates and adjoining neighbors have endorsed this initiative.


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View of the future entrance to the Site, from 19th Place, above, and from the entrance at 26th Street looking toward the adjoining neighborhood, away from the Property, below. The surrounding neighborhood is generally well kept with tidy, appealing homes.

Additional views taken on the Site, above and below. Other than selective logging on some of the upper reaches of the Property, the site remains largely untouched. The Plan of Development for the Property has been tailored to maintain as much of the sites natural features and beauty as reasonably possible while still allowing an economical housing density. Once cleared, the majority of the homes on the Site will have some views of the River Valley.


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cÜÉ}xvà WtàtM Site Improvements: Upon completion, the Project site will be fully improved and ready for the construction of new homes. All interior streets have a 50 foot “Right of Way” and will be asphalt paved over a 25 foot width with rolled concrete curbs and gutters. Streets and roadway improvements will be constructed to State of Alabama Highway Department “Standard Specifications for Highway Construction”, 1992 Edition, Section 400, standards. All utility services will be under-ground and will be furnished by the following:

Service Provider Contact Electricity Alabama Power Company (800) 888-2726

Gas Alabama Gas Company (800) 811-7703

Telephone Interstate & Valley Telephone Co. Knology, Inc. (706) 645-8630

Water & Sanitary Sewer East Alabama Water, Sewer & Fire Protection District (334) 756-7150

Cable TV & High Speed Internet

Charter Communications or Knology, Inc.

(800) 955-7766 (706) 645-8630

Site Design and Engineering for River Oakes has been provided by Stothard Engineering, Inc. of LaGrange, Georgia. Environmental & Soils Engineering Studies: A Phase I Environmental Report was prepared on the Project Site in mid-August 2006 and determined that the property was free of any environment conditions that might adversely effect its development. The Company has commissioned a Soils engineering survey and review which is not yet complete but preliminary site investigation by the Company’s civil engineers has revealed no unusual or adverse conditions and none expected to be discovered as the Soils work is completed. Copies of the Environmental and Soils Engineering Reports will be made available to qualified builders. Lots: The following is a preliminary schedule of lot availabilities:

Phase 1: 68 lots 9,000 square feet-32,126 square feet Available May 2007-June 2007

Phase II: 80 lots 9,000 square feet-39,160 square feet Available July 2007-September 2007

Phase III:

36 lots 12,000 square feet-50,647 Available October 2007-November 2007

Townhouses/Condo Site:

41 units (contained within 6.93 acres +/-) Available Early to Mid-Summer 2007

Lot Prices: Final Lot Prices are still being set and a lot-by-lot pricing schedule will be released shortly. Generally, however, overall prices are expected to average around $39,000 for single family homes and $28,000 for the Townhouse/Condo units. Premium “Riverfront” and “River View” Lots are expected to be priced in the $80,000 to $100,000 range. Design & Construction Standards: The Project is intended to appeal to home-buyers across a reasonably broad range of pricing, from a minimum of approximately $150,000 to up-wards of $300,000 for single family homes and $125,000 to $135,000 for the Condominium Town-homes. Although not yet complete, to ensure a high level of quality across the entire price range for the Project Design and Construction Standards are being developed that will specify minimum standards for unit sizes by lot size, architectural design features, minimum building materials specifications; and, lot landscaping and finishing requirements. The objective of these Standards is not to “homogenize” the Community but to ensure a complementary and harmonious appearance and “feel”; and, to preserve the quality and value of the Project for all participating Builders and home-buyers. River Oaks Homeowners’ Association: Home-buyers at River Oaks will become members of the River Oaks Homeowners Association. The Association, a non-profit public benefit corporation, is being formed for the purpose of providing for the maintenance and up-keep of the “Common Areas” of the Community including, but not necessarily limited to, Entry Features, Nature Trails and walk-ways, the River Walk, etc. and to maintain and enforce building design and construction standards, property maintenance standards and other Community guide-lines and rules to ensure the preservation and enjoyment and of the Community by all of its residents over the long term. While not yet complete, the Rules of the Homeowner’s Association are not expected to be unusual or onerous in any regard, nor are the monthly assessments of Membership Fees expected to be burdensome. Copies of the draft Homeowners’ Association formation documents and Rules will be made available to interested Builders for comment as soon as they are completed.


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TuÉâà itÄÄxçM While the City of Valley had its beginnings in early 1800 as one of many trading post settlements along the Chattahoochee River in an area once a part of the Creek or “Muscogee” Indian Nation, its “modern” history dates to approximately 1866. Following the Civil War, two groups of local merchants and planters that survived the War with fortunes intact organized the Alabama-Georgia Manufacturing Company to build two textile mills on sites formerly occupied by water powered gristmills. One at present-day Langdale and one at Riverview (then known as “RiverView”). Subsequently, a Mr. Lafayette Lanier organized the West Point Manufacturing Company to compete with Northern textile manufacturers. Lenier purchased the the Langdale mill—then known as the Chattahoochee Manufacturing Company—and soon followed on with the development of many more mills and the “Lanett Bleachery and Dye Works”, one of the largest industries of its kind in the country at the time. Lanier was a fervent believer in the potential of the region that viewed every economic downturn as an opportunity to expand, even as others pulled up stakes. This confidence allowed him to build a world-class textile company that continues to grow and prosper to this day. The area surrounding West Point Manufacturing’s mills, originally referred to as “The Valley”, was comprised of six inter-locking towns located within a 3 mile radius—Lanett, Shawmut, Langdale, Fairfax, and River View, all in Alabama; and, directly across the River—and state line—West Point, Georgia. Although entirely dependent upon the textile industry for their way of life, for well over 100 years, when “Cotton was King”, these towns flourished. West Point Manufacturing, today’s West Point Home, Inc., furnished the residents of “its” towns with whatever they needed—jobs, schools, churches, stores, recreation et al. However, as the international textile industry began to consolidate in the late 1960’s—and the company’s largess to diminish—Valley residents realized the necessity of becoming self sufficient and incorporating their own City. Accordingly, in 1980, Shawmut, Langdale, Fairfax and River View joined to incorporate the City of Valley (which they accomplished in only 15 months!) while the Cities of Lannett and West Point incorporated independantly. While West Point Home, Inc. continues to operate mills in Valley, and, employs approximately 2,500 people, the City and Chambers County, are diligently working to diversify and broaden the area’s economic base. They have attracted many new industries to the area and—by working closely with KIA Motors representitives—expect to attract many of the company’s migrating to the area to support KIA’s new West Point Assembly Plant.

Historical Postcards illustrating two of West Point Manufacturing’s Valley plants


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Although the on-going development of the Kia Motors Assembly Plant in nearby West Point is a principal driving force behind much of the anticipated demand in Valley, Chambers County, and the surrounding areas, it is not the its sole engine of demand. As described by the near-by City of Opelika’s Economic Development Director, Mr. Al Cook, the southeast’s “Golden Triangle”, defined by Auburn, Alabama, to the West, Columbus, Georgia, to the East; and, LaGrange, Georgia, to the North, is experiencing dematic growth and is expected to become home to some 800,000 people during the next decade. The population of Lee County, Ala., which comprises much of the southern portion of this area, increased by 30% between 1990 and 2000 and seems on track to repeat such growth during the current decade, while Chambers County is beginning to experience similar expansion.

Growth also continues apace in the Auburn-Opelika area, with many new residents commuting to Montgomery, Columbus, and even so far as Atlanta, or drawn by expansion at and around Auburn

University. The University is itself experienceing major growth as exemplified by the “Shelby Center for Engineering Technology”. Phase I of this $108 million project, a 200,000 square foot building that will house research laboratories, classrooms, lectuare halls and offices for the Department of Computer Science and Software Engineering and the Department of Industrial and Systems Engineering will commence operation in November 2007. These factors have given rise to major growth in the Auburn-Opelika area, each of which are adding an estimated average of 500 families a year.

In Columbus, Georgia, officials at Fort Benning recently confirmed that the US Army’s Armor School at Fort Knox, Kentucky, is being relocated to Fort Benning. This move, a result of the Military’s on-going “Base Realignment and Closure” program (“BRAC”), will combine the Army’s Infantry and Armor Traning Centers at Fort Benning and, in the processs, flood the region with soldiers and their families, “…making the Fort Benning-Columbus area one of the most vital in the military”. According to the Department of Defense, the addition of the Armor School is expected to bring approximately 33,000 new residents and 11,000 additional jobs to the Columbus area over the next five years! Approximately 5,400 of the newcomers will be soldiers and 5,500 or more, federal civilian employees and contractors. With them will come approximately 8,000 spouses and nearly 14,000 children. According to Maj. Gen. Walter Wojdakowski, Commanding Officer of Fort Benning and the Infantry School, the Army will spend $1.3 billion over the next five years to build the new Armor Training Center at Benning to replace the one at Fort Knox. Other previously announced BRAC relocations to Ft. Benning could increase total relactions to the Post to up-wards of 80,000! Work on the new Armor School is expected to begin in early 2007 and while actual Unit relocations are not expected to begin for 3 years or more, the area is already experiencing added growth with the influx of job-seekers from out of the area as contractors gear up for work in a tight local labor market.

“BRAC” is not the only event driving growth in the Columbus area. An influx of new businesses in response to the expanding automobile manufacturing industry in the area; and, existing business expansions are also impacting housing demand. For example, insurance giant AFLAC , headquartered in Columbus, has announced a major, $100 million, expansion that will add over 2,000 new jobs to the local economy.

Many of Columbus’s newcommers will be required to locate in the surrounding outlying areas and commute because of the lack of affordable housing. And many of these, like many people already employed at Fort Benning and in Columbus, choose to live in Alabama, due to lower housing costs and dramatically lower taxes. The Valley area and adjoining Lake Harding already have many residents that make the easy, 30 minute, commute to jobs in the Columbus area.

30 Miles

20 Miles

10 Miles

5 Miles

The “Golden Triangle”

The Estimated River Oaks Estates Market Area


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`tÜ~xà TÜxt fàtà|áà|váM

The original of this and addition information is available on the Internet at http://www.edpa.org/bsc/viewcommunitydetails2.asp?action=view&city_code=17


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Because the Market Area of the Project is expected to include neighboring areas, the statistics for neighboring communities are also included as follows:



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The formation of KMMG—Kia Motors Manufacturing Georgia—and Kia Motor’s decision to erect it’s first U.S. manufacturing plant in West Point, Georgia,—4½ miles from the River Oaks site—is arguably one of the most important events for the City of Valley and Chambers County since Lafayette Lanier’s West Point Manufacturing Company bought the Langdale Mill in the late 1800’s. According to Kia Motors, the name "Kia" derives from the Hanja ki meaning arise or come up out of while the a stands for Asia. So Kia is

roughly translated as “arise or come up out of Asia”. In the U.S., the a might just as easily stand for Alabama, the home of Kia’s parent company’s first U.S. manufacturing facility—the Hyundai Motor Company’s assembly plant in Montgomery. Accordingly, in the U.S. Kia might be translated as Rising out of Alabama! Kia was originally founded as the “Kyungsung Precision Industry” to manufacture steel tubing and bicycle parts in 1944. In 1952, the Company changed its name to Kia and began building motorcycles, trucks and cars. In 1986, in partnership with Ford Motor Company, Kia produced several Mazda derived vehicles for both domestic sales and export. The “Pride”, based on the Mazda 121, sold in North America and Australia as the Ford Festiva while the “Avella” sold as the Ford Aspire. In 1998 the company was acquired by South Korean rival Hyundai Motors. Kia Motors America was incorporated in Irvine, California, in 1992, and the first Kia-branded cars were sold in the U.S. by dealerships in Portland, Oregon, in February, 1994. Since then, Kia has methodically expanded on a region by region basis in the U.S. and, in less than a decade, has become a significant player in the U.S. auto market with over 275,000 vehicles sold in 2005! In March, 2006, Kia Official’s announced their selection of West Point as the site for the company’s first U.S. manufacturing plant at a ceremony attended by KMC President and CEO, Euisun Chung and Georgia Gov. Sonny Perdue in Seoul, Korea. Work on the 2,150 acre site, located at Webb Road, on the west side of U.S. I-85, just north of West Point, began in April, 2006, and continues apace today with crews working 24 hours a day, 7 days a week. When completed, the $1.2 billion, 2.4 million square foot, manufacturing facility will include two vehicle assembly lines, an engine assembly line, a paint shop, a training center, a welcome center and two adjacent supplier facilities. The plant is scheduled to begin testing operations by May 2008 and to reach full production—300,000 vehicles per year—by 2009. To bring the plant online as quickly as possible, the Georgia Department of Technical and Adult Education’s Quick Start program will build and staff an on-site training center to serve as a custom community training center.

Kia is expected to employ 2,893 people at the new facility at average salaries of approximately $50,000 per year. Additionally, two suppliers, co-located on the Kia Campus to satisfy “just-in-time” parts deliveries, plus at least 4 other “Tier I” and “Tier II” suppliers that are expected to locate in nearby Alabama will employ an additional 3,000 or more people. Based on the U.S. Bureau of Labor Statistics figures, each of these “core” manufacturing jobs can be expected to generate as many as 1.8 more jobs

“The Power to Surpr ise”

The City of Valley

Progress at the Kia Plant Site just west of I-85 in West Point, Georgia

Artist’s Rendering of the Kia Assembly Plant including Test Track


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in supporting industries. Accordingly, as many as 15,000 new jobs are expected to be created within the immediate market area of River Oaks. According to the Georgia Department of Economic Development, the Kia plant is expected to have a $4 billion annual economic impact on the surrounding communities in Georgia and Alabama—all of which will lead to a significant increase in the local population with an attendant demand for housing. The effect of these events is already becoming evident. In West Point the first of 140 Kia engineers and staff from Korea began moving into 40,000 square feet of temporary office space at a former Raytheon Systems building located on Orchard Hill Road at the West Point Campus of West Georgia Technical College in mid-December, 2006. Several of Kia’s primary suppliers have also announced plans for new facilities in the surrounding area. South Korea based GMB Automotive USA an industry leader in developing high-precision, high-performance components for engines and automatic transmissions is developing a new facility in near-by Auburn. Scheduled for completion in spring 2007, GMB is expected to inject approximately $28.6 million in capital investment in the Auburn facility and create approximately 200 high paying jobs. Similarly, Great Lakes Metal Stamping Inc. (“GLMS”) of Bridgman, Mich., recently broke ground on a new manufacturing facility in the Cusseta Industrial Park on the south side of Valley. GLMS will produce stamped metal components along with welded and mechanically fastened subassemblies for Kia and the rapidly growing automotive industry in the South. The facility will represent an initial capital investment of approximately $3.5 million with employment expected to exceed 50 associates when fully operational. It will occupy 10± acres within the Cusseta Industrial Park and will initially cover 30,000 square feet, with expansion plans of up to 80,000 square feet. In Dadeville, Alabama, approximately 40 miles from West Point, KwangSung Corporation, a manufacturer of flexible tubing, labeling and sun visors began the construction of a new 66,000 square foot facility at the William T. Industrial Park in mid-December, 2006. Upon completion, the new plant will employ at least 150 people to supply parts to Kia Motors and the Hyundai Assembly plant in Montgomery. The new Dadeville facility will be KwangSung's first American operation. Also in mid-December, 2006, Daewon America LLC, a division of Daewon Kang Up, one of the world’s largest manufacturers of springs and coils, began the construction of a 160,000 square foot manufacturing facility on a 30-acre site in the Northeast Opelika Industrial Park, located along Interstate 85 at Exit 66. The facility will produce automotive suspension bars and coils to supply Kia as well as the Hyundai assembly plant in Montgomery, Alabama. The facility will represent an initial capital investment of $30 million, with employment expected to exceed 170 associates when fully

operational. (Daewon will join existing Hyundai suppliers, Mando America Corporation and Maxforma Plastics, LLC that have already constructed facilities in Opelika, as well as Benteler Automotive that supplies BMW and Mercedes.) Other collateral development arising from Kia’s new facility that will lead to significant job, and population, growth is also continuing apace in the Valley area. Plans for two major hotels have been recently been announced—reportedly including a Hilton Hotels Embassy Suites Franchise—for sites near Exit 77 from U.S. I-85, at its intersection with FOB James Drive/Phillips Road on the south side of Valley. Similarly, on December 11, 2006, the Greater Valley Development Group—a public/private partnership between ITC Holding Company of West Point, Georgia; the Chambers County Industrial Development Authority; and, the City of Valley—presented the final Plan of Development for the “Sportsplex Lifestyle Center” to the Valley City Council. This project, a mixed commercial/retail and multi-family residential project, will be developed on an approximately 70 acre land assemblage on the southwest corner of FOB James Drive and Fairfax Bypass, adjoining Valley’s popular “Sportsplex” Community Center and the campus of Southern Union State Community College, approximately ½ mile east of U.S. I-85. Construction of the focal point of the project—a 20± acre retail center that is expected to include upwards of 200,000 net rentable square feet in multiple buildings—is scheduled to begin in late January, 2007.

20+ Acre Retail Center Development to begin January ’07.


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While a several of Kia’s Tier I and Tier II Suppliers have already made commitments to locate new facilities in Chambers County and nearby areas, the Chambers County Industrial Development Authority and the Alabama Development Office are maintaining an ongoing program to promote the Valley and Chambers County area. Most recently, in November, 2006, a 30 person delegation including officials from the IDA, ADO and local Valley, Lanett and West Point business and community leaders traveled to Soul, Korea where they participated in a Korea/Alabama Business Seminar, attended by 18 of Kia/Hyundai’s top suppliers. Many of these companies made commitments to visit the area and inspect prospective sites during the coming (now current) year, and consider incentive packages that will be made available through the State. These and other efforts are expected to result in significant increases in employment opportunities—and accordingly, population growth—during the foreseeable future. (For additional information on the internet please see http://www.chamberscoida.com and http://www.ado.state.al.us) Additional information on new business locations and development in the area will be made available as events occur. The Managing Member of River Oaks Partners, LLC, Ms. Pamela Howell-Russell, has also maintained on-going contacts with the Kia Housing Development Coordinator at the Chambers County Chamber of Commerce and will gladly assist qualified builders in working with this individual. Additional information is available upon request.

Documents

PRELIMINARY BUILDERS SUMMARY