Welsh Special Asset Services

WELSH’S SPECIAL ASSET SERVICES INCLUDE:

• Providing innovative solutions for all commercial and residential property
types including mixed-use
• Securing the property and enhancing operation
• Ensuring tenant retention and filling vacancies
• Preserving the property value and maximizing the financial performance
• Creating a disposition strategy based on current market conditions
Integrated Services Platform

“Welsh’s level of personal service and attention to detail are second to none. They

always made me feel like the most important client in the company. With the results

I got, it is obvious that keeping my best interests in mind was a top priority for them.”
John Trautz, Principal,
Reliance Development Company L.L.P.

INTEGRATED SERVICES Welsh Companies has been opening doors since 1977 when we
PLATFORM
began as a build-to-suit and speculative development firm.
Receivership Services
Today, the Welsh Companies organization consists of more than
Asset Services 300 professionals whose expertise extends into virtually
• Acquisitions
• Asset Management every aspect of commercial real estate .
• Dispositions

Property Management Welsh has distinguished itself from other commercial real

Accounting Services estate companies through its significant experience as a

full-service provider of commercial real estate solutions . The

Asset Valuation
principals of Welsh have transacted business in numerous
Brokerage
• Industrial metropolitan areas, cultivating extensive relationships with
• Office
major institutions, investment banks, lenders, REITs, private
• Retail
• Land equity funds, and more. This type of approach enables us to
• Residential
• Multi-Family skillfully and efficiently deal with even the most
• Healthcare
complicated issues facing our clients.
• Senior Housing
• Hospitality

Investment Sales

Development, Construction,
Architectural Services

Finance
 Acquisitions Strategic Planning Financing
Dispositions Site Selection Servicing
Investment Services Planning/Architectural
Fund Management Cost Estimating Through our affiliation with SAM we are
able to combine local entrepreneurial
Legal Construction expertise with a nationwide network to
Management deliver the very best capital markets
Asset Management execution and alternatives to its clients.
Senior Housing
Investor Relations
Valuation

Receivership / REO Assignments

Retail
Brookdale Center, Brooklyn Center, MN 1,000,000 sf
Brookdale Center is a 1 million square foot regional mall, located in Brooklyn Center, Minnesota. The Center
is anchored by Macy’s and Sears, with many national retailers comprising the majority of the remaining space.
Welsh Companies has been managing this property as a bank-owned asset since July 2008. Our responsibil-
ities include management, accounting and leasing of the center. In addition, Welsh Companies has been work-
ing closely with the lender and the City of Brooklyn Center to establish a long-term development plan for the
Center.

Educational
505 Wabasha St N, St. Paul, MN 82,000 sf
505 North Wabasha Street in St. Paul is the 82,000 square foot former Science Museum of Minnesota and Min-
nesota Business Academy. Welsh Companies was selected by the lender to manage, lease and market the
property for sale. As the property was a recently vacated school facility, Welsh Companies was charged with
securing the property, preventing damage due to climate conditions and repositioning the property for sale.
Welsh Companies was successful in identifying a buyer for the facility and eventually closed the sale on the
asset.

Hospitality / Mixed-Use
Centerplace Complex, Rochester, MN 341,500 sf
The Centerplace Complex was comprised of three separate buildings. Centerplace Office, located at 155 1st
Ave SW, was an 11-story, 91,000 square foot, class B space and was 100% leased by Mayo Hospital and U.S.
Bank. Centerplace Galleria Mall, located at 111 South Broadway, was a 85,500 square foot retail center with a
mix of retail and restaurant tenants, including Gap, Talbot’s, Foot Locker and Lens Crafters. Occupancy was 70-
80%. The Radisson Plaza Hotel, located at 150 South Broadway, was an 11-story hotel comprised of 212 rooms.
Welsh Companies took over the management of all three properties in order to preserve the value of the as-
sets. In a partnership with Regency Hotels, we undertook a multi-million dollar renovation of the hotel and
common areas, restoring the value of the property.
Property Management Design/Build Master Planning/ General Maintenance
Site Analysis
Property Accounting Tenant Improvements Plumbing
Programming
Facility Management General Trade Electrical
Construction Space Planning
Healthcare HVAC
Construction Architecture
Brokerage Management Locksmith
Interior Design
Receivership
Investment Sales

Our membership with NAI Global

extends our brokerage expertise
around the world with global access to
325 offices in 55 countries.

Office
8100 34th Ave S, Bloomington, MN 760,000 sf
8100 34th Avenue in Bloomington is a 760,000 square foot office property. The property consists of four
buildings: three, 3-story office/tech buildings and one low-rise office tower. The total size of the campus is
42 acres. HealthPartners occupied 65-75% of the property and the rest was occupied by small storage-type
leases. Welsh Companies managed the property for 18 months, and successfully sold it to an investment
firm.

Residential
7th Place Residence, St. Paul, MN 500,000 sf
7th Place Residence, the former Orpheum Theater, is a 500,000 square foot mixed use residential property
in the heart of downtown St. Paul. The main floor consists of 21,000 square feet of retail space and the res-
idential portion is made up of 130 apartment units. Responsibilities after receiving the assignment included
management, accounting and leasing of the property. Welsh Companies successfully positioned the prop-
erty for sale.

Industrial
1000 Valley Park Drive, Shakopee, MN 316,000 sf
1000 Valley Park Drive is a 316,000 square foot industrial building in Valley Green Business Park, Minnesota’s
largest industrial park. The company operating out of the facility went bankrupt and the receivership was as-
signed to an entity whom in turn hired Welsh Companies to sell and lease the space. Welsh Companies led
the marketing effort and successfully sold the property to ADC Telecommunications.
 The Benefits of Welsh’s Fully-Integrated Platform

Special Asset Services

An increased demand for receivership services is a result of the recent turbulent economic climate;
however, Welsh has long been in the business of successfully preserving the value of numerous
properties on behalf of mortgage holders nationwide. Welsh’s experience with all product types,
throughout all markets and combined with their depth of service, provides clients with a one-of-a-kind
fully-integrated platform for receivership services.

Asset Management
The asset management team at Welsh takes a project from acquisition due diligence to full
implementation of the specific acquisition plan for assets to increase value during the hold period.
They also oversee the development of annual business plans and budgets, approve capital expenditures,
give hold/sell/refinance recommendations and manage the disposition progress. The management team
has a hands-on approach with personnel who direct and oversee leasing, marketing, periodic reporting,
tenant and property legal matters, and billing and collection issues for each asset. They are also
responsible for insurance reviews as well as real estate tax reviews and appeals. Currently, the asset
management group oversees assets totaling over 18 million square feet.

Welsh Managed Property Summary

13% 52% Property Type Total Square Feet % of Portfolio Current Value

Industrial 13,726,464 52% $823,587,840

10%
Office 4,275,362 16% $534,420,250

Office/Tech 2,235,602 9% $201,204,180

9% Retail 2,623,360 10% $393,504,000

Residential/Other 3,404,722 13% $102,141,660

26,625,510 $2,054,857,930
16%

Welsh Current Receivership Square Footage 1.2 Million

Welsh Offices
Managed Commercial Property
Owned Senior Housing &
Residential Property

Property Management
The Property Management Division of Welsh manages one of the largest portfolios of commercial real
estate in the upper Midwest. During real estate “down cycles,” we have managed and leased a
receivership portfolio of approximately 100 assets comprising more than 8 million square feet.

Our property managers are committed to preserving and enhancing the image of every property,
maximizing overall return. Property management teams provide the specific disciplines necessary for
each task. Every building is maintained in the best possible condition and is always ready to be viewed by
a potential tenant or buyer. We ensure client satisfaction by building a responsive relationship and delivering
prompt and conscientious service.
Brokerage
Ranked in 2008 as the number one brokerage firm by the Minneapolis/St.
Paul Business Journal, NAI Welsh brokerage specialists have an intimate
knowledge of the Twin Cities market, which helps us to consistently identify and
secure the best space, property or land site for our clients.

Our brokers specialize by regional sub-market as well as by property type, so they

thoroughly understand the ins and outs of their target market. Whether it is office,
industrial or retail brokerage, land sales, healthcare, multi-family or mixed use, our
wealth of experience, comprehensive database, technological expertise and strong
market research enable us to quickly identify and target the right buyer or user, and
in turn, generate the greatest value for our clients.

Through our partnership with NAI Global, the world’s only

managed network of commercial real estate firms, our expertise extends around
the world with global access to over 5,000 real estate professionals in more than
325 offices and 55 countries.

Investment Sales
Welsh Companies provides capital market expertise through the acquisition and
disposition of investment real estate for our clients. Our team delivers a
comprehensive process utilizing aggressive market underwriting, as well as
detailed and well presented packaging to each client irrespective of the property
size and value. By providing creative market-based underwriting, coordinating the
due diligence process, assisting with the development of property pro rations and
reviewing closing statements for accuracy, we are able to maximize value and
returns.

Our investment services team is a member of NAI Global’s Investment Services

Group, a dedicated group of the organization’s top brokers in major markets
nationally. The NAI Global Investment Services Group shares a marketing platform
and operating strategy designed to obtain and execute business with institutional
and private equity property owners alike.
“The people at Welsh really strive to establish a team relationship with their customers.

They have clear and concise communication down to a science. They always deliver what

we need... which is why we’ve continued to work with them throughout the years.”
Kathy Tucci, Vice President
Facilities & Administrative services,
Bremer Financial

Asset Valuation
Our Brokerage and Investment Sales Group understand your need to have a broker opinion of value, many times
in advance of deciding upon a prudent course of action and a real estate investment secured by a mortgage. We
are skilled and prompt at providing a detailed asset valuation supported by current market data for you to use
in your internal analysis.

Development, Construction & Architectural Services

Welsh Development With the support of our architecture, construction, leasing,
management and investment specialists, Welsh Development provides a full range of
development, redevelopment, project management and build-to-suit services. Our diverse
professional staff has experience with development of all commercial and residential
property types including industrial, office, retail, apartments, senior and for-sale housing.
Whether a project is half-built, just a concept or needs a complete overhaul, Welsh
Development delivers the attention to detail that is necessary to make a project successful.

Genesis Architecture Genesis Architecture provides a full range of standard and

customized architectural services to a variety of clients. We approach all projects, large or
small, with each client’s short and long-term goals, design priorities and financial
requirements in mind.

Welsh Construction The professionals at Welsh Construction specialize in building and

renovating space for institutional investors, individual property owners and businesses. Often
working with our affiliates at Welsh and Genesis Architecture, Welsh Construction offers a
complete range of construction services to meet the needs of each client.
Welsh Institutional Relationships
Welsh Financial Relationships
Accounting Services
The Welsh team of experienced Property Accounting and I/T professionals,
coupled with our wide array of accounting software experience, enables us
to easily comply with the requirements of our extensive, diverse portfolio of
property owners. We perform property accounting duties for large
institutions as well as locally owned, single-property owners, so we believe
that we are uniquely qualified to comply with our clients’ cash management,
reporting, and accounting requirements regardless of the size of the
portfolio.
On a daily basis, we provide high quality, accurate reports on time, and we
work with our property managers and brokerage specialists to enhance the
value of our clients’ assets.
Finance
Welsh Capital arranges three types of financing - construction, permanent
and equity - for clients. Providers include life insurance and finance
companies, pension funds, commercial banks and Wall Street investment
conduits. Welsh Capital provides the best financing services available for
all property types - retail, office, industrial and multi-family apartment
buildings.
Welsh Capital is a member of Strategic Alliance Mortgage
L.L.C. SAM is a unique company owned by 21 members
who are all individually owned, commercial real estate investment
banking/mortgage banking firms located coast to coast throughout the
United States.
The goal of SAM is to provide local, proprietary expertise for borrowers and
lenders from individual member companies that are leading providers of the
best financing alternatives in their respective markets based upon their
knowledge and the collective wisdom of the group.
 Reporting
Welsh has implemented strong internal control

procedures designed to ensure reporting accuracy

and to protect the assets we manage on behalf of our

clients. We provide a variety of high quality, accurate

reports to ensure that our clients always have the

most up-to-date information. All reports are available

online, giving our clients access to the information they need 24 hours a day, 7 days per week. Tenant receipts

and delinquencies, vendor payments and liabilities, cash balances, and rent rolls can all be viewed.

Monthly Reports

Each month, our clients receive financial reports and

4350 Baker Road
Suite 400 0897 Minnetonka Business Plaza 32,200 31,000 96% 1,200 4%
Minnetonka, MN 55343 0652 CenterPark Industrial 15,300 6,000 39% 9,300 61%
0652 Penn Business Center executive summaries to assist them with their investment

decisions. These reports are provided in an easy to read

106
202
1,288 Tenant B
1,450 Tenant C
$0.85
$0.92
1095.00
1334.00
8/1/2003
12/1/2003
2/28/2009
2/28/2009
electronic format, so they may be forwarded as needed.
250 6,590 Tenant D $0.72 4745.00 4/1/2001 1/31/2009
252 12,000 Tenant E $0.70 8400 2/1/1999 3/31/2009

Year-End Reports

Year-end expense reconciliations are designed to reimburse

or collect from tenants for actual operating expenses

incurred throughout the year as opposed to the assumed expenses that have already been paid. Our property

operating budgets are extremely detailed, and they serve as a guide throughout the year to help explain to

our clients any actual versus budget variances.

Direct Contact

Our property accountants handle every aspect of the financial

reporting for client properties, rather than focusing on a specific

function (such as cash receipts, accounts payable, etc.). This

approach makes them an integral part of the team. They are

readily accessible to our clients, and are encouraged to engage

in direct communication.
The Current Headquarters of Welsh

In May 2008, Welsh relocated its company headquarters to Baker Road Corporate Center. The project was

designed and built by Welsh Construction and Genesis Architecture and has been awarded Leadership in Energy

and Environmental Design - Core and Shell (LEED-CS) Gold Level pre-certification by the U.S. Green Building

Council. It is one of only a few buildings in Minnesota and

approximately 250 nationwide to achieve the Gold Level certification.

Contact:
Jean Kane
President / Chief Operating Officer
952.897.7711
jkane@welshco.com

Mark Parten
Senior Vice President, Property Management
952.897.7814
mparten@welshco.com

Ted Jokerst
Vice President, Welsh Capital
952.897.7877
tjokerst@welshco.com

4350 Baker Road, Suite 400

Minnetonka, Minnesota 55343
952.897.7700
www.welshco.com

MINNEAPOLIS | ST. PAUL | CHICAGO | DETROIT | ST. LOUIS | CINCINNATI