Clear Sky Capital

Sunbelt Strategies Fund Offering investors the opportunity to participate in the growth potential of the multifamily real estate market in Sunbelt States such as Arizona.

DISCLAIMER  This  presenta,on  is   intended  for   informa,on  purposes  only  and  does  not  cons,tute  an  offer  to  sell  or  a  solicita,on  to  buy  securi,es.  No  securi,es   regulatory   authority   or   regulator   has   assessed   the   merits   of   the   informa,on   herein   or   reviewed   this   presenta,on.   This  presenta,on   is  not   intended   to  assist   you   in  making  any   investment  decision   regarding   the  purchase  of   securi,es.  Rather,   the  Fund  has  prepared   an   offering   memorandum   for   delivery   to   prospec,ve   investors   which   describes   certain   terms,   condi,ons   and   risks   of   the  investment  and  certain  rights  that  you  may  have.  This  presenta,on  is  not   intended  for  delivery  to  any  person  without  the  accompanying  offering  memorandum.   If  you  did  not  receive  an  offering  memorandum,  please  contact  us   to  obtain  one.  You  should  review  the  offering  memorandum  with   your  professional   advisers  before  making   any   investment  decision.   This   presenta,on  and   the  accompanying  offering  memorandum  are  intended  for  delivery  only  to,  and  par,cipa,on  in  the  investment  is  restricted  to  investors  to  whom  certain  prospectus  exemp,ons  apply,  as  described  in  the  offering  memorandum.    This  presenta,on  contains  disclosures  that  cons,tute  forward-­‐looking  informa,on  under  securi,es  laws.  Various  assump,ons  are  applied  in  drawing  conclusions  set  out  in  forward-­‐looking  informa,on,  including  assump,ons  about  the  Sunbelt  States  real  estate  market,  economic  condi,ons,  global  financial  crisis,  availability  of  capital  and  government  policy.  The  forward-­‐looking  informa,on  herein  is  based  (in  whole  or  in  part)  upon  risk  factors  which  may  cause  actual  results  to  differ  materially  from  those  contemplated  in  the  forward-­‐looking  informa,on,  including  risks  associated  with:  economic  condi,ons,  the  global  credit  crisis,  real  estate  markets,  financing  efforts,  construc,on  delays,  cost  overruns   and   regulatory   changes.   You   should   not   place   undue   reliance   on   forward-­‐looking   informa,on   and   actual   results   may   differ  materially   from   the   forward-­‐looking   informa,on   herein.   The   foregoing   statements   expressly   qualify   any   forward-­‐looking   informa,on  contained  herein.  The  Fund  is  not  obligated  to  update  or  revise  any  forward-­‐looking  informa,on  except  as  required  by  applicable  law.  

Who is Clear Sky Capital?

Management has over 17 years of experience in buying, redeveloping, managing and selling multifamily apartment

buildings in Canada and the U.S.

Clear Sky Capital is a private equity "rm with local investment management specializing in established multifamily apartment

buildings in strategic real estate markets.

Proven Track Record Project Number of

Units Location Purchase Price Date of Purchase Sale Proceeds Date of

Sale

Seacrest Apartments 109 Nanaimo, British Columbia CD$6,300,000 February

2004 CD$13,300,000 September 2012

Highland Townhomes 21 Nanaimo, British Columbia CD$810,000 January

2002 CD$2,000,000 April 2008

Panoramic Tower Apartments & Georgia

Towers Apartments 83 Campbell River,

British Columbia CD$3,150,000 October 2002 CD$8,080,000 June 2006/

March 2006

Seawind Apartments 24 Nanaimo, British Columbia CD$700,000 November

2000 CD$1,700,000 June 2006

Villa Lea Apartments 24 Edmonton, Alberta CD$525,000 May 1998 CD$745,000 June

2001

The Whitehouse Apartments 37 Edmonton, Alberta CD$624,000 March

1996 CD$1,248,000 June 2001

Sprucedale Apartments 21 Edmonton, Alberta CD$480,000 May 1997 CD$687,000 May

2001

Northland Arms Apartments 70 Edmonton, Alberta CD$1,700,000 October

1997 CD$2,500,000 October 2000

389 CD$14,289,000 CD$30,260,000

U.S. Property Acquisitions Project Number of

Units Location Purchase Price Date of Purchase Sale Proceeds Date of

Sale

Bethany Palms Apartments 22 Phoenix,

Arizona, USA US$547,000 July 2010 US$1,880,000 December

2013 Heritage Square

Apartments 120 Gilbert, Arizona, USA US$7,500,000 July

2011 - -

Mission Palms Apartments 125 Phoenix,

Arizona, USA US$6,250,000 April 2011 - -

Parkway Manor Apartments 24 Scottsdale,

Arizona, USA US$1,180,000 February 2012 - -

Arcadia Del Sol Apartments 260 Phoenix,

Arizona, USA US$11,750,000 May 2012 - -

Country Club Greens Apartments 68 Phoenix,

Arizona, USA US$4,000,000 February 2013 - -

Airmont Apartments 21 Phoenix, Arizona, USA US$940,000 September

2013 - -

Timberline Place 102 Flagstaff, Arizona, USA US$11,825,000 January

2014 - -

742 US$43,992,000 US$1,880,000

The FIVE STEPS

Clear Sky Capital strategically invests in regions that demonstrate three fundamentals for ideal multifamily property locations:

• High Population Growth • Historically High Employment • Recovering Real Estate Market

IDENTIFY REGION

“Prescott is one of the 10 best places to retire in the U.S.” – Wall Street Journal

INVESTMENT LOCATION

With a population of approximately 211,000 people, the Prescott Metropolitan Area, is the third largest metropolitan area in Arizona after Phoenix (4.2M) and Tucson (1.0M).

Prescott grew by 17.4% from 2000 to 2010, which is a much higher population growth rate than the U.S. average of 9.71%.

HIGH POPULATION GROWTH

United  States  Census  Bureau  -­‐  2010  

PRESCOTT MAJOR EMPLOYERS Employer Industry

Yavapai Regional Medical Center Healthcare Yavapai County Government

Veterans Administration Medical Center Healthcare Prescott Uni"ed School District Education

Wal-Mart Retail City of Prescott Government State of Arizona Government

Fann Contracting Hwy/Heavy Construction Yavapai College Education

Embry-Riddle Aeronautical University Technology Chelton Avionics Manufacturing

Exsil Government Sturm, Ruger & Co. Firearms

HISTORICALLY HIGH EMPLOYMENT

•  The  PrescoR  unemployment  rate  is  6.9%    •  Down  from  9.2%  in  January  2013    •  Ahead  of  the  Arizona  State  average  of  7.8%  

Citytowninfo.com;  United  States  Bureau  of  Labor  Sta,s,cs  –  November  2013;  Economic  and  Business  Research  Center,  The  University  of  Arizona    

32.2%  DROP  

$246,600    (May  2007)  

$143,200    (Feb  2012)  

$167,100  (Nov  2013)  

RECOVERING REAL ESTATE MARKET

Zillow  Home  Value  Index  -­‐  PrescoR  Home  Prices  and  Home  Values  –  Condo  Prices  (Includes  data  and  transac,ons  through  11/30/2013)  

Prescott 10-Year Condo Values  

Prescott is an ideal market for multifamily investment due to:

1.  Historically low vacancy rates

2.  Moderate household incomes combined with high average condo prices

Prescott - Rental Market

Prescott, Arizona Historically Low Vacancy Rates

Since 2005, vacancy rates in Prescott never reached 7%, even during the peak of the credit crisis from 2008 through 2010.

Prescott, AZ

4.74%

-

6.98%

6.91%

6.42%

6.07%

5.13%

3.56%

Prescott, Arizona Historically Low Vacancy Rates

Prescott, AZ

4.74%

-

6.98%

6.91%

6.42%

6.07%

5.13%

3.56%

As of 2012, the Prescott vacancy rate was 4.74%, 47% lower than the Arizona vacancy rate of 9.01% and 30% lower than the U.S average.

QUICK FACTS ABOUT PRESCOTT, AZ

Prescott (1) Phoenix (2)

Median Age 54.1 32.2

Median Household Income $44,278 $54,745

Condo Value Index(3) $167,100 $112,000

Prescott, Arizona Income-to-Condo Price

(1)  PrescoR  Census  2010.  (2)  City  of  Phoenix  Planning  &  Development  Research  Team  -­‐  2010  Census  Summary  File.  USD  

(3)  hRp://www.zillow.com  (Includes  data  and  transac,ons  through  11/30/2013)  USD  

Moderate household incomes combined with high average condo prices is ideal for multifamily investment.

Properties must provide two key methods of generating potential investment returns:

• Stable Cash Flow • Long Term Capital Appreciation

IDENTIFY PROPERTY

150-unit

Class “A” property

Built in 1999

Located in an 1150-acre master-planned residential and private golf community

• Heated pool and spa area • Private garage (select plans)

• Private balcony/patio • State-of-the-art "tness center • Resident clubhouse available for meetings and entertaining • Views of Granite Dells and Watson Lake (select plans)

• Adjacent to a Hale Irwin Signature 18-hole golf course • Attractive grounds with covered ramadas and barbecues

AMENITIES

Six  dis>nc>ve  one,  two  and  three  bedroom  floor  plans,  includes:    Full  size  washer  and  dryer,  designer  kitchen,  dishwasher,  refrigerator  and  microwave,  ceiling  fan,  walk-­‐in  closet,  and  private  deck  or  balcony  with  storage  area.    

UNIT TYPES

PROPERTY DETAILS 1.  NO VACANCY

•  Units at the Legacy at Prescott Lakes 100% leased (as of Dec 15, 2013)

•  Waiting list for units to become available

2.  HIGH TENANT CONCESSIONS •  Discounted rent and tenant incentives average US$13,277 per month •  9.29% of Gross Rent lost due to concessions

PROPERTY DETAILS

3. RENT RATES BELOW MARKET •  Average rental rates in Prescott have increased a cumulative 20.8% since 2005

•  Since 2005, The Legacy at Prescott Lakes has increased rental rates by 0.3%

4. LOW PURCHASE PRICE •  Units being acquired are substantially below replacement cost for approximately US$108,333 per unit •  Average condo price in Prescott is US$167,100

The Fund has developed two exit scenarios for The Legacy at Prescott Lakes: 1. Sell The Legacy at Prescott Lakes as an apartment building; or 2. Sell individual condominium apartments as the market improves over the same time frame. The exit scenario which is ultimately implemented will depend upon a number of factors including the lending terms and the potential upside in the “for sale” condominium market. Anticipated Holding Period: 4 to 6 Years

EXIT STRATEGY

80% pro"t share for Cash-Flow distributions to the investor.

80% pro"t share of Sale Proceeds received by the investor.

Cash Flow to investors are paid on a quarterly basis.

Cash #ow distributions largely treated as a return-of-capital.

Sale distributions treated as a capital gain.

No U.S. Tax Return

Investment Proceeds & Distributions

* subject to reaching certain investment thresholds prescribed under the Tax Act.

Sunbelt Strategies Fund - Investment Offering

Securities Offered: Trust Units, which are Class A trust units of the Fund. Price Per Security: CD$10 per Trust Unit. Minimum Subscription: CD$5,000 (500 Trust Units). Eligible for Registered Plans: RRSP, Spousal RRSP, LRSP, LIRA, RRIF, LIF, LRIF, RESP, DPSP, RPP or TFSA.*

All information regarding the Clear Sky Capital Arizona Realty Fund

can be found in the Offering Memorandum.

Please see your registered Dealing Representative for more details.