The Blue Book Of Real Estate Syndication High Income Real Estate Investing Invstment Investor Rich Dad Carleton Sheets No Money Down Dolf De Roos

4520 West Saanich Road, Victoria, BC V8Z 3G4 • www.PrattenProperties.com • Tel: (250) 479-7732 • Fax: (250) 380-7425

Dear Investor,

It has been said that, those who wish to invest wisely invariably turn to real estate to realize all of their
dreams.

How true.

It is also widely known that more millionaires have been created in the medium of real estate investing than in
any other. What is far less well known however, is that by participating in larger real estate ‘deals’ rather than
smaller ones, more money can be made, more quickly, and with nearly the same level of effort—or, if one is
truly wise, with no effort at all.

A person in the business of creating large real estate developments has much to do: locate and investigate the
property, conduct feasibility studies, consult with architects and tradesmen, design floor plans, visit city hall,
meet with councillors to obtain special permission for variances to local by-laws, employ salesmen to offer the
newly built or redeveloped properties, and a myriad of other tasks. -- Much to do for sure, but certainly not so
much as to prevent an experienced professional, with a team of talented and able men and women, from
accomplishing the goal and collecting the profits over and over again.

On the other hand, a person who invests in large real estate developments can gain substantial returns on
their money without doing one thing more than putting pen to paper. (Certainly, a wiser person than the first,
some might say.)

We at Pratten Properties are the first person, and we invite you to invest the next few moments of your time
studying this material to determine if you are to be the second.

That said, I am pleased to introduce you to our organization and our latest syndication opportunity: Namely, an
exclusive investment offering between 15 to 25% R.O.I. with a range of unique tax-sheltering possibilities.

In the accompanying booklet, we have been sure to include all the information that we would want to know
were it our first time considering partnering in a venture such as this. It has been written plainly and with a
minimum of distraction so that the investment opportunity described in its pages will be clearly understood,
and stand on its own merits. When you are ready, click this link to download the Executive Summary for our
current syndication project. When you have finished reading this informative manual in its entirety, please feel
free to contact me personally to answer any questions and to provide you with specific details on our latest
syndicated project.

Thank you for your consideration, and best wishes for your financial future.

Sincerely,

LAN

G. P

RATTEN

President and CEO

The

Blue Book

Real Estate Syndication

Presented by:

Pratten Properties

Copy #

________ of ________

Written and Prepared by:

Emanuel Furtado Arruda

including the right of reproduction

in whole or in part in any form

No part of this publication or any derivation thereof

may be reproduced or distributed in any form or by any means,

or stored in a database or retrieval system without the prior

written permission of the publishers

IMPORTANT NOTE:

The statements herein are based on information which we believe

to be reliable at the time of publication, but we cannot represent

that they are complete or accurate. This booklet is for

informational purposes only and shall not constitute an offer to

sell or a solicitation to buy any securities.

Important and specific information about a particular investment

will be set out in the applicable Offering Document. You should

obtain and read the Offering Document before making your

investment decision.

No offering will be presented except in accordance with the

governing securities laws.

5.13.2005

When you have read this informational material in its entirety, just
click this text to download the Executive Summary for our current
syndication project.

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The Importance of Owning Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 02

A Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 02

Bigger Buildings Bigger Profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 03

Barriers? What Barriers? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 03

Smaller Investments Big Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 04

Private Syndications: The Vehicle of Choice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 04

Limited Partnerships: One Form of Group Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . 05

Tax Benefits for the Investor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06

Selling Your Share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06

How to Choose the Right Syndicate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06

Why Consider Group Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 07

Choosing Your Investment Leader . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 08

8 Key Benefits of Private Syndications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 09

4 Big Reasons to Syndicate with Pratten Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 3

10 Things You Need to Know about Pratten Properties . . . . . . . . . . . . . . . . . . . . . . . . . 1 6

The Team Leaders—Proven Real Estate Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 3

The Game Plan—How we run our Syndications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 3

• Our Objective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 4

• Our Corporate Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 4

• Our Acquisition Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 4

• Our Investment Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 5

• Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 6

Risks and Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

• Internal Control Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 7

• Property Investment and Management Risk Controls . . . . . . . . . . . . . . . . . . . . . 38

• Property Development Risk Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

• Taxation Risk Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

• Management Risk Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

• Financing Risk Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

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• Performance & Leadership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 6

• Investments Offered & Services Provided . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 7

• Member-Partnership & Friendship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 9

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• Knowledge & Communication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2

• Conscientious Investing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 3

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TABLE OF

CONTENTS

PRESIDENT’S

INTRODUCTION

Dear fellow Investor,

Not since the Second World War has mankind seen such uncertain and unstable times (I know,
because I’ve lived through them all). Today, the threat of global terrorism makes the economic
instability caused by the recession of 1991, and the crash of the Japanese economy in 1999 look like a
cakewalk. As if that weren’t enough, the tech-stock induced disintegration of the stock market left a
trail of nervous investors in its wake. As for these skittish investors left still speculating in the
markets; you wouldn’t want to partner with such Nervous Nellies in your business, so why would
discerning investors like you and I “partner” with them in our investment portfolios?

It just doesn’t make sense.

There is a better way, and it certainly isn’t new: It is an extensively documented fact that investments
in Real Estate have made millionaires of more reasonable men and women than any other investment
in history. In fact, if you examine any 10-year period in the last 100 years, you will witness something
remarkable. Namely, a 10.8% increase in the value of Real Estate no matter where in that hundred-
year period you choose to begin your 10-year examination.

I have staked my career on this fact for the past 40 years. In my long career, first as a
builder/contractor, then as a licensed real estate agent and private investor, I have quietly amassed my
fortune in real estate all over Vancouver Island and Mainland BC. I have developed and built, bought
and held, fixed and flipped, and renovated and redeveloped over 500 substantial properties. Currently,
the property management division of my company profitably manages all of my own properties as well
as hundreds of units for my select clientele.

Now, in the 41st year of my career, I want to share an opportunity to invest in my latest development
with you, my fellow sophisticated investor. An opportunity to partner with me, along with my
personally-selected team, in large-scale, income-generating syndicated properties. We call them Pratten
Properties.

I’d be pleased if you would take the next few moments to study this booklet and learn how I plan to
partner with you and a tight circle of other like-minded men and women in a high-return, limited-risk
investment, and offer you returns that are sure to make your accountant blush. When you’re through,
I invite you to speak with me personally to answer any further questions you may have.

When you are ready, click this link to download the Executive Summary for our current syndication
project. Each investment stands on its own merits and we encourage you, the investor-partner, to
examine them for yourself. Our unique ‘transparent’ disclosure method invites you to see the basis
of our investment decisions for each of our syndications and become part of the process. In essence,
you see what we see in every opportunity so you can make an informed investment decision.

I am delighted to offer you an opportunity to invest with us in our latest real estate syndication
project and the opportunity to gain entry into these highly lucrative investments. I look forward to
meeting and speaking with you personally.

Sincerely,

Alan Pratten, President and CEO
Pratten Properties

this property to their franchisees at a price that produces a profit every

month well in excess of their cost of financing and maintaining the

property, but not so much as to make leasing the property unattractive

to the occupier. These same franchisees not only paid for their rights to

operate their store from McDonald’s, in most cases their franchise fees

also pay for the investment real estate that they are now leasing from

McDonald’s as well. Wisely, McDonald’s doesn’t stop there. They also

receive profits from the wholesale sales of food to the franchisee, as

well as a portion of the profits of each location in the form of

franchising, advertising, and marketing fees. We should all be so smart.

BIGGER BUILDINGS

BIGGER PROFITS

Just like McDonald’s restaurants, some of the most profitable

income properties are extremely large and expensive investments

that are leased to other businesses.

Office buildings, shopping centres, industrial parks and warehouses,

lodging facilities (including hotels, motels and resorts), medical

centres, and even power production facilities all fall under the

category of

commercial real estate. Under the right management, all

of these can become excellent income properties.

A different form of large and lucrative income properties are occupied

by residents rather than businesses. Types of

residential investment

properties include condominiums, rental apartment buildings, senior’s

housing, etcetera. The cost to build or purchase desirable income

properties like these can range from millions, to tens-of-millions, and

sometimes even hundreds-of-millions of dollars, and requires an

experienced property management team to operate and maintain

them profitably.

Indeed property management is a whole other can of worms. It is one

thing to have the funds required to purchase or build large investment

properties, it is quite another to keep them profitably occupied,

maintained and managed year after year. For this reason, many

property owners choose to outsource their property management

services to management firms that specialize in operating income

properties profitably for their owners—of course, this valuable

expertise is also provided for a fee. Even so, with the right mix of

property, tenant, and property management, large income properties

can be

extremely profitable and worry-free investments.

BARRIERS?

WHAT BARRIERS?

As noted earlier, large profits usually come at the price of large investments.

This is fine for the builder or developer who has continually built and sold

his developments for a profit and re-invested his earnings into increasingly

THE IMPORTANCE

OWNING

REAL ESTATE

It is no secret that the greatest wealth-builder in history has always

been investment in real estate. Real estate is more than just a

fallback investment during a bear market. And, unlike the ‘paper’

investments of the stock and bond markets, carefully selected income

properties have real long-term value secured by physical assets.

Additionally, they are not subject to the wide fluctuations common

to stock markets and, when properly managed, they can continue

providing a steady return on investment of 15 to 20% per annum

even when the real estate market is flat. With mortgage rates at

historic lows and vacancy rates in prime areas hovering at 1.5% ,

investing in high-income properties has never made more sense.

So, why isn’t everyone investing in real estate?

In a sense, most people already are: Tenants pay monthly rents or leases

to the owners of income properties in exchange for the use of the space

in which they live or conduct their business. In addition, the tenants may

pay property management fees, financing fees, mortgage fees, and a

multitude of other fees for services that the owners choose to provide in

exchange for these fees. All of these tenants (and in the case of

commercial properties, all of the tenants’ clients) are trickling their

money up (in the form of monthly rent, lease payments, or maintenance

and strata fees, etc.) to provide a return on the investments (R.O.I.)

made by the owners of the property. So, although the tenants are

receiving benefits from occupying the property, they are not realizing

any residual income or tax-sheltering benefits from the ownership of

the property itself.

A CASE

STUDY

When asked what business McDonald’s is in, most people would

immediately answer ‘selling hamburgers’. And although it’s true that

McDonald’s has successfully sold billions of hamburgers for many

many years, they are most definitely

not in the hamburger business.

The McDonald’s Corporation owns a great deal of the most valuable

and coveted income properties all over the world. They in turn lease

LIMITED PARTNERSHIPS:

ONE FORM OF GROUP OWNERSHIP

Although the legal structure of a syndication can take many forms, it

is generally accepted that a Limited Partnership is one of the best

forms of group ownership of real estate investments. It offers all of

the financial rewards and tax benefits of individual ownership

without the burden of management responsibilities, liability for

principal debt, or large individual cash investments.

Basically, the setup is as follows:

A group of investors is formed to purchase and control a specific

property. Each contributes what he or she wishes toward the purchase,

usually in easy-to-divide units, such as 10%.

One of the members of the group, or even an outsider, becomes the

General Partner for the group and the investment. Chosen for his

expertise, the General Partner is granted all decision-making powers

for the investment. This includes management, though he may hire

a professional management company rather than handle it himself.

Everything that happens to the investment is at the sole discretion of

the General Partner. He decides when major expenditures are needed,

but will usually attempt to get a group opinion first. He determines

the optimum time to sell or trade, and establishes the selling price. It is

obvious that he must keep the goals of the group in mind at all times.

Now, the catch: As General Partner, he also assumes total liability for

the investment. Were a property to get into major financial

difficulties, the cost (or loss) is his responsibility.

The remaining partners in the group are

Limited Partners. Their financial

obligation is limited only to their initial investment. If the whole

investment goes bad, the most they stand to lose is their initial investment.

This raises the question,

“Why would anyone want to be the General

Partner?” First of all, the likelihood of a properly selected and managed

property going bad, is remote. In addition, the General Partner is usually

paid for his services, and he also has a piece of the action, so, it is in his

best interest to make the venture as profitable as possible.

More often than not, real estate brokers will serve as General

Partners. A experienced investment realtor knows the market, and

can locate the right investment for the group. When it is time to sell

the investment, the realtor will likely represent the group as exclusive

agent. This is added incentive for him to serve as General Partner

and to keep up or increase the value of the property.

larger projects, but what about the individual private investor? How can

the individual investor with limited skills in real estate development, or

less than a million dollars in cash, get in on such an attractive

investment? Are these highly desirable opportunities reserved only for

conglomerates, investment banks, and powerful ‘old money’ families?

Thankfully, the answer is

No.

SMALL INVESTMENTS

BIG OPPORTUNITIES

There are already mechanisms and legal frameworks in existence

which allow like-minded investors to band together in order to

purchase and control substantial investment properties. Of course,

each carries its own advantages and disadvantages.

A public newsletter published by BDO Seidman, LLP. Accountants

and Consultants asserts:

“The syndication process – aggregating capital from a group of investors

to acquire property – is seeing new popularity as real estate increasingly

is viewed as a fourth asset class in addition to stocks, bonds and cash.

Real estate investment trusts (REITs) are an attractive way to invest in

real estate, but their publicly traded shares are subject to a significant

degree of price volatility that many investors seek to avoid.

By contrast, shares in a private syndicate, typically real estate limited

partnerships (RELPs) or a privately held REITs, are not priced to market

on a daily basis and in addition offer the possibility of higher returns

than publicly managed real estate. Finally, private syndicates offer some

tax savings unavailable when investing in a public company.”

PRIVATE SYNDICATIONS:

THE VEHICLE OF CHOICE

When you invest with a private real estate syndication, you are

pooling your capital with that of other qualified investors for the

purpose of investing in larger and more lucrative real estate projects.

This affords the lone investor an opportunity to participate with an

organized group of like-minded investors in the ownership of a piece

of revenue property that is too much to handle singly or in a joint

venture with just one or two others.

Real estate syndicates own income-generating residential or commercial

real estate and are secured by tangible and quantifiable assets as

collateral. This characteristic is untrue of many other investments and

provides added security for your investment. Additionally, investing in

private real estate syndications gives the individual investor the ability

to achieve extraordinary profits with no liability for debt.

TAX BENEFITS

FOR THE INVESTOR

One of the best features of the limited partnership form of investing is

that, properly structured, a limited partnership offers the investors all the

advantages of sole ownership without the drawbacks, such as double

taxation. It is able to pass all tax benefits on to the limited partners.

For example, a limited partner investing 10% of the capital that was

raised to purchase the property, becomes a 10% owner of the

investment. In each reporting period, he receives a proportionate

share of the total profits—in this case 10%. At the end of each year,

he receives a tax statement from the accountant for the group, so he

is able to take 10% of any tax shelter or depreciation benefits

resulting from the ownership, and apply them to his overall tax

situation as well.

When the property is sold or refinanced, he receives 10% of the total

proceeds, after closing costs or refinancing fees, and paying the

General Partner’s share. In short, he has all of the advantages of the

individual ownership combined with the advantages of a

management-free investment.

SELLING

YOUR SHARE

When a partner decides he no longer wishes to retain his share in the

partnership, he is free to seek a buyer for it. Selling a portion of a

limited partnership share in a real estate holding is not much

different from selling the property itself.

So long as he adheres to applicable securities laws, the seller offers

his proportionate interest to potential investors at what he considers

to be fair market value. This will no doubt be at a price higher than

he originally paid—after all, it is still a real estate investment that is

appreciating each year. The only difference is that it may only

represent a 10% interest in the entire project.

Once he has a ready, willing and able buyer to purchase his share at a

certain price that is acceptable to him, the other partners will

generally have a right of first refusal to buy that share on the same

terms and conditions as the offer. Ask your General Partner if there

is a buy-back plan to help you cash out quickly in the event of an

unforeseen personal situation.

HOW TO CHOOSE

THE RIGHT SYNDICATE

All members of the group should have the same basic investment

goals. An investor who is looking for a high cash flow should not be

put in the same investment as an investor who wants a tax shelter

with little or no cash flow produced by the property. Obviously, one

property cannot offer both.

Select a knowledgeable individual to act as your General Partner. A

good General Partner will know (or get to know) all of his investment

partners personally, in order to group like-minded investors together

with the investment and holding period that will best serve their

needs. Make sure he also has a vested interest in the venture so that

his profit is tied to the success of the investment. You should

determine the guidelines as to the operation of the property at the

time the group is founded. This includes basic management policies,

optimum holding period, etc.

Using this vehicle, investors with limited investment capital are able

to join with others and share proportionately in the monthly profits

from rent, periodic cash disbursements upon refinancing or sale of

the property, and tax benefits offered by real estate investments.

Without the group, many would not have sufficient capital to

become a real estate investor. At the same time, since control is in

the hands of the General Partner, the chance of painful disagreements

among the investors is minimized, and the overall stability of the

investment is enhanced.

WHY CONSIDER

GROUP INVESTMENTS?

There are two primary reasons for considering any group from of

investing:

First of all, it offers an investor with limited investment capital the

opportunity of getting involved in real estate investing and receiving

all the benefits of owning real estate (like cash flow, and asset

appreciation), as well as the benefit of tax savings that are not

available to other types of income (like interest and dividends). In

addition, he is able to join forces with others and “pool” resources.

The second reason for joining one of the larger groups is to

completely divorce yourself from the task of locating, analyzing,

purchasing and managing your real estate investment. The syndicate

you join does all of that for you.

So, use this brief chapter as a basic background in investment in a

real estate syndication. That’s all it was intended to do. Your

accountant or lawyer, and well as the leader of the syndication, will

be able to answer any specific questions you may have about how

your participation in a syndication will benefit your portfolio. If your

accountant or lawyer is inexperienced in this field, contact one who is.

PRIVATE

SYNDICATIONS

EIGHT KEY

BENEFITS

How Syndicates Create Wealth for Investors

BENEFIT #5:

DIVERSIFICATION OPTIONS

A major advantage of some syndications is that they can enable the

individual investor to diversify among a number of different properties

or investments. Diversification may well be the most important way

to protect against significant losses in any investment.

BENEFIT #6:

INCREASED SAVINGS

By pooling the investment capital of a number of investors, even a

small real estate syndicate can achieve cost savings otherwise

unattainable to the individual investor. (The best legal, tax planning

and investment advice don’t come cheap.) In addition, all else being

equal, larger properties are more cost-efficient than smaller ones,

since many expenses are lower on a per unit or square foot basis.

These savings translate into significantly more profit being

distributed to every investment partner.

BENEFIT #7:

CASH RESERVES & INCREASED STABILITY

The need for cash reserves is often overlooked when inexperienced

investors buy real estate. Syndication can assure that sufficient

capital is available to give the investment staying power, and the

ability to withstand economic downturns or temporary shortfalls.

BENEFIT #8:

EARNINGS TRANSPARENCY

Like public companies, earnings are reported per unit on the basis of

Generally Accepted Accounting Principles (GAAP). That way you

can compare all of your various types of investments easily and take

the appropriate deductions off of your next tax return.

THE

BOTTOM LINE

Syndicates, over time, have demonstrated a consistent track record of

providing the benefits of ongoing current income, the potential for

unequalled long-term appreciation, and tax-efficient earnings. They

are equities that derive their value from tangible and quantifiable

assets, and they have been proven to bring the benefits of balance,

diversification, and greater risk/reward efficiency to a broad range of

investment portfolios.

Whether your investment style is value-driven or growth-oriented,

individual or institutional, syndicate participation can clearly be of benefit.

So, the question still left unanswered, is:

“Which syndicate should I join?”

EIGHT KEY BENEFITS OF

PRIVATE SYNDICATIONS

BENEFIT #1:

PREDICTABLE REVENUE STREAM

A syndicate’s reliable income is derived from rents paid for the use of

leased properties. A strong property management team can focus on

attracting only the most reliable of suitable occupants to the

properties. These types of tenants often sign leases for long periods

of time, and this in turn creates stable cash flows for the participating

investors. In addition, having carefully structured lease agreements

serve to further reduce risk.

BENEFIT #2:

UNIT PRICE APPRECIATION

Most syndicates operate along this straightforward and easily

understandable business model: By making improvements, the

property’s value is increased, and by increasing rents or occupancy

rates, higher levels of stable monthly income may be generated. The

raised value, and higher incomes are then added to the investors unit

value and monthly cash flow distribution.

BENEFIT #3:

TAX MINIMIZING BENEFITS

Due to the structure of our syndications, the profit on the properties

flows through to the investor as if the individual was solely holding

the investment. This means you get to deduct a proportionate share

of the building’s expenses and depreciation against your income. So,

in addition to their profit, the investors receive all of the tax

minimizing benefits of holding real estate, as well as the further

benefit of having absolutely none of the personal liability risks

associated with private ownership of real estate.

BENEFIT #4:

TOTAL RETURN

The combination of stable cash income return, capital gains (from unit

value appreciation), and tax savings can result in very healthy overall

returns for all participating investors. In addition, the group’s ownership

of tangible assets with established values further reduces risk.

BIG

REASONS

to Syndicate with Pratten Properties

CHOOSING YOUR INVESTMENT LEADER

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3. HOW DO YOU SPELL

TAX RELIEF?

Are your investments costing you more than they should? Without

professional guidance, serious investors can suffer serious tax

repercussions. Now more than ever, even the most experienced

investors need to have professional advisors working on

their side of

the ledger.

We want to attract the very best investor-partners possible to every

Pratten Properties syndication, so we contacted the experts behind

the four biggest initials in the accounting business: K

We asked KPMG to devise an array of comprehensive profit-

maximizing, and tax-minimizing strategies that would be sure to

make even the stodgiest of investors, smile. They succeeded, they’re

available now, and yes, they’re all perfectly legal.

4. TAILOR-MADE

INVESTMENTS

Are your current investments of the ‘off-the-rack’ variety? Do they

still fit you as snugly as they once did? There’s nothing more

embarrassing—or more costly—than finding out you’re still sporting

last-year’s investments.

To remedy that situation, we’d like to introduce you to our

investment tailor: KPMG

At your request, your Pratten Properties’ Syndication investment can

be custom-tailored to suit your investment portfolio. The talented

people at KPMG will work with you personally to put our unique

profit-maximizing and tax-minimizing strategies to work for you.

To ensure that you derive the maximum benefits from your investment,

Pratten Properties will retain the services of our financial consultants at

KPMG to custom-tailor an investment solution for every one of our

qualified investors for a confidential, one-on-one consultation.

During your private review engagement, your KPMG investment

counsellor will present you with your best choices of investment

positions that provide you with options with respect to priority of

return, risk, and tax benefits. That means you can choose the balance

of risk and return that best suits you.

WHY INVEST WITH

PRATTEN PROPERTIES?

Serious investing is best done with serious professionals shielding you

from personal liability and exposure to taxation. So, with that said, if

you’re still looking for reasons to syndicate with Pratten, here are four

big ones:

1. ACCESS TO

REAL ESTATE SKILLS

Real estate investment is a far more complicated process than might

at first appear: Are you skilled in determining real estate values,

negotiating favourable purchase agreements, financing the purchase,

negotiating leases and managing the property? If not, then the most

obvious advantage of our syndicates is that the knowledge and skills

of our team of extraordinarily talented real estate professionals—

whom you’ll meet, starting on page 24—are available to our syndicate

member-partners.

Our investment leader, Mr. Alan Pratten, has more than 42

consecutive years of experience in the business of real estate

investing through many different market climates, and each of his

team-members are hand-picked specialists in their respective fields.

Together, we know what to do, and even more importantly, we know

what

not to do with an investment property. Our collective

experience has provided us with all the necessary elements to put

together incomparable real estate investment vehicles—the kind that

personally invest in.

2. THE BEST POSSIBLE

LEGAL COUNSEL

Are your current investment assets vulnerable to a legal attack? Why

bother making more money if doing so is going to leave you wide open

to litigation? We live in an era when no investor can be without the

protection of the best legal counsel, and no matter what your financial

situation, no one can afford to make even the smallest of mistakes.

That’s why we’ve taken steps to ensure that the specialists we select to

make up our legal advisory committee are also extremely talented. As

a result of their hard work and ingenuity, while participating in any

Pratten Properties syndication, our syndicate member-partners have

ZERO liability for principal debt.

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Some landlords view their relationship with tenants as a game of

winners and losers. Consequently, many of them farm the whole

property management process out to third parties. At Pratten

Properties, we believe that the relationship with our occupiers is too

important to hand over to someone else.

Currently, the management division of Pratten Properties manages

significant multi-dwelling property locations and commercial buildings

located all across Vancouver Island. It’s a lot of ground to cover, but

with Customer Service Teams dedicated to each property and our 24/7

telephone helpdesk, the Pratten Properties Management Group

encourages a dialogue aimed at providing our occupiers with cost-

effective and efficient working and living environments. Our

experience shows that occupiers who are happy and effective in their

property are more likely to stay put, take more space, or recommend

us to others—and that’s a good result for everyone.

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In the drive to maximize income and value, a property company is

only as good as the occupiers which populate its buildings. Pratten

Properties makes itself attractive to occupiers by providing high-

quality buildings in prime locations, on terms which suit their needs.

In addition, we take an active approach to attracting prime tenants

for our current properties, and use our waiting lists to identify prime

targets for future additions to our real estate portfolio.

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Our approach to keeping our occupier base resilient over time is

accomplished in stages. First, we attract strong businesses and reliable

residents with good financial covenants. Then we provide lease

agreements which give them what they need, but also protect the

investment’s value. Finally, we keep our occupiers happy with the

service they are getting, and the way in which their property works. It’s

a simple approach that works consistently for everyone.

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Problems don’t stick to working hours, and since we too have a

financial interest in keeping our properties occupied by happy paying

tenants, Pratten Properties is there to help occupiers on a 24-hours-a-

day, seven days-a-week basis. Our telephone helpdesk is available to

handle calls every week around the clock. Sometimes they are calls

for help (

“My roof’s leaking”, “My drain’s blocked”, etc.) and

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If this is your very first time meeting us, there are some things you’d

probably like to know about us, like:

“Just what makes you guys so

special, anyway?”—We’re so glad you asked . . .

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Pratten Properties is at the forefront of providing syndicated income

property to the retail, medical, residential, and business space

markets in Western Canada and beyond. It is our specialist local

micro-market knowledge, our strong balance sheet, and the very

diversity and quality of our tenant mix, in combination with our

flexible and service orientated culture, that makes us confident in our

ability to continually drive the business forward.

As you’ll find out in the next section of this booklet, every member of our

team has been chosen for their unique talents, their related experience,

and the specialized knowledge and skills they bring to our organization.

Before we invest, our team looks at everything from materials and

access, to parking and space planning. Once our proprietary

Closed-

Loop Management™ program is in place, we maintain a close

dialogue with occupiers, and because of this, we keep on top of what

residents and businesses alike are looking for. The results of these

made-to-measure or designed-to-suit approaches can be seen in the

properties we create and the occupiers we attract and retain.

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As specialists in property investment, development, and

management, as well as in the syndication of residential and

commercial properties, Pratten Properties owns and/or manages

approximately 1180 units (and growing). The bulk of these holdings

are owned by Pratten Properties with the remainder held jointly, or in

syndications with private investors like yourself.

Our portfolio consists of various sizes of apartment buildings, Strata

Corporations and commercial buildings, individual condominiums and

multi-million dollar luxury waterfront homes, as well as stock of single-

family homes. The number of property locations we manage has

grown continuously and consistently, providing the stable growth of

Pratten Properties and the confidence of its clients in our management.

We provide our investors with a complete picture of how their

syndication investment is performing via comprehensive monthly or

quarterly statements, and what we’re doing to further enhance that

performance, through timely newsletters. As expected, our

management teams are also available to discuss any issues with our

member-partners and occupiers.

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The most important thing to know about the people who work for

Pratten Properties is not how many of us there are (just under 20 of

us if you’re wondering), it’s about the way in which we work: The

integration of the various Pratten Properties divisions with the many

external partners that support our operations is crucial to delivering

service to customers and value to our investors.

Our team-members’ skills and job functions overlap to create an

organization that is highly effective and does not “live in boxes”. This

culture is essential to maintaining direct contact with our customers

and also in successfully managing our external partners.

Our Property Management division is particularly a people business

that interacts with our customers, the tenants. We view our staff as

our essential asset, and are committed to their advancement, giving

priority to a continuous program of specialist training and

professional development for everyone in our organization.

Whether hiring or outsourcing, we choose to associate only with other

service-minded professionals. Whether they be internal managers and

staff, external suppliers, or syndication partners, all of our relationships

are personally selected.

We simply wouldn’t have it any other way.

sometimes they are calls for advice (

“Can I get permission to make

some alterations?” or, “I’m thinking of taking more space”). Whatever

the nature of the enquiry, our helpdesk—and the Customer Service

Teams dedicated to each property—can either supply the answers or

put our occupiers in touch with someone who can help.

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In the most successful partnerships, each side brings something different

to the party. Shared resources, contacts and information provide some of

the biggest benefits and opportunities for our syndication partners.

As a result of our experience, track record and market position, Pratten

Properties has a huge resource of knowledge in the residential and

commercial property sectors. The relationships we have cultivated in

these sectors allow our investors access to this market expertise, and

provide us with opportunities which match expertise with solid

financial backing. It is this synergy that allows us to produce and

deliver above-average returns for our investor-partners.

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Pratten Properties recognizes that many businesses are becoming

more and more specialized in their needs. Buildings have to either fit

precisely the purpose for which they will be used, or be highly

adaptable to the needs of the occupants. They have to be able to

accommodate the latest in operational and technological

requirements. So, whether it’s a new development or refurbishment

of existing properties, our approach is to either work with end users

to ensure that they get the space they need, or to make sure our

speculative development has built-in flexibility.

We take into account everything from availability of parking and

elevator access, to landscaping and interior design. We maintain a

close dialogue with occupiers, and because of this, we keep on top of

what businesses are looking for. The results of these made-to-

measure or designed-to-suit approaches can be seen in the properties

we create and the occupiers we attract.

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A well-explained business plan and accurate data are the lifeblood of

our business, and clear financial information is one of the major

benchmarks by which the best companies are judged. Pratten

Properties is committed to an open approach and to delivering

accurate and comprehensive information from both the operational

and financial dimensions of our company.

When you have read this informational material in its entirety, just
click this text to download the Executive Summary for our current
syndication project.

THE

TEAM

LEADERS

A TEAM OF EXPERTS

Real Estate Syndication is a superior investment

vehicle than can only be made more profitable

with the right team of investment leaders at the

helm. When you participate in a syndicated real

estate investment in partnership with Pratten

Properties, you can be sure that your investment

is in experienced hands.

Want proof? Read on.

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Adam Gant is a licensed realtor, an accomplished entrepreneur, a

private real estate investor, and a valuation specialist with an

uncommon talent for all things financial and mathematical. He is a

board member and part owner of many corporations offering

diverse products and services. Among these are a real estate

investment training company, a property management company, a

financing company, a private Investment development company,

and a high-tech firm.

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Quantifying the ’up-side’ of the deal.

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Creative problem solving.

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“When I put together investments

that no one can compete with.”

Career History

In his first year of University, Gant launched his first real estate related

business: a residential contracting franchise. As a 1st-year “rookie” in

this business, Gant achieved the highest productivity level ever

recorded by the 25-year-old organization, and earned his first of two

Leader of the Year awards. In his second year of business—now with

staff totalling 23 men and women—he gained entry into the

prestigious

President’s Club in recognition for his outstanding

achievements in both gross sales and net profits. It was in this

business that he cut his teeth in all areas of sales and marketing,

accounting, interviewing and staffing, negotiating, training, and

management. Later, being ever mindful of his civic responsibilities,

Gant put his business to work in support of various charities including

the

Big Sisters chapter in Vancouver who honoured him with a Gold

Patron Award for his company’s contributions to the organization.

In his first year of real estate investing, Gant acquired 1.1 Million in

properties using his own creative negotiating and financing

techniques. (Since then, he has acquired several times that amount.)

As V.P. of Finance for Pratten Properties, he is responsible for assessing

and controlling risk for each syndication, as well as the administration

of our rigorous due-diligence processes. In his role as Director of

Capital Development, he employs his own mathematical models to

detect the opportunities in the numbers, quantify them, and ensure

appropriate action is taken until their hidden profits materialize.

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Alan Pratten is an entrepreneur, a licensed realtor, and a seasoned

private investor. He is also President and CEO of Exit Realty Abacus,

a well-established realty agency on Vancouver Island, and Abacus

Properties, a leading property management company since 1994. He

is a member of the Victoria Real Estate Board, a Commercial Division

member, and a Certified Commercial Investment Member candidate.

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Finding opportunities and enhancing value.

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“When everybody comes out a winner.”

Career History

Alan Pratten lends over 40 years experience as an entrepreneur of

real estate business. His areas of expertise include sales and leasing,

construction, property development and re-development, and

property management. As a successful realtor and owner of

investment income property, one of Pratten’s main talents is finding,

delivering, and enhancing winning investment opportunities. He has

a proven track record of implementing effective management

strategies to increase the value of the properties in his company’s care.

Pratten began accumulating his wealth of experience and expertise in

all facets of the Real Estate Industry in 1963. He gained his hands-

on experience in the planning and construction of residential and

commercial properties as the owner of his own construction

company in Bristol, England. In 1978 he moved to Victoria, BC to

begin his various private investment and entrepreneurial pursuits in

Canada. In 1994, he opened his property management office, Abacus

Properties, and then added his real estate sales office, Exit Realty

Abacus, to his array of services in order to enhance the other

operations as well as his personal real estate holdings. Currently, he

continues to invest privately, both on his own and in partnership

with other private investors in real estate projects all over Canada.

Today, Pratten provides complete residential and commercial

accommodation and property services to a wide range of occupiers

across Canada. His objective is to create long-term and sustainable

returns for his investors through activities which include property

investment, development and total property management.

ADAM DOUGLAS GANT

ALAN GEOFFREY PRATTEN

A. GRANT DIXON

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Grant Dixon is an expert assessor, developer and a licensed realtor

specializing in commercial and residential land development. Dixon’s

talents are expressed in his ability to quickly determine precisely what

can and should be done with a certain property, assess its viability as

any one of a number of possible types of development forms that

could be considered, and the profit-generation potential for each type.

As Senior Assessor, he’s responsible for managing our meticulous due-

diligence processes for every property we develop and syndicate.

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Finding the opportunity

in the opportunity.

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“When I see what no one else saw.”

Career History

For more than 10 years, Grant Dixon has demonstrated a talent for

producing consistent property development success. As a Developer,

he can take the right property and bring it to the desired end result—

be that children playing in their backyard, a commercial franchise

operation on the main strip in town, or a medical office in the suburbs.

Creating something from nothing is one of Dixon’s best talents.

Over the span of his career, Dixon has built much more than just

residential and commercial subdivisions in Eastern and Western

Canada, he’s also built valuable business relationships throughout the

development industry—all of them built on trust, reliability, and

mutual respect. In a business as competitive as real estate

development, having a skillful liaison like Grant Dixon on your team is

an enormous advantage.

Feasibility and viability are everything. It takes a keen eye to see the

opportunity in seemingly unrelated events. For instance, knowing

that a certain municipality is upgrading or expanding the sewer

service in a certain area means that occupancy allowances will likely

increase in the area, and with that comes the opportunities for new

developments to be created in the surrounding area. Recognizing

how, when, and where to capitalize on events such as these, results in

significantly more opportunities in areas where no one else is looking.

Dixon’s talent for recognizing and acting upon these subtle signals

means we get there first.

Emanuel Arruda is a communications specialist with a talent for

producing communications tools that contain both sizzle and steak.

He brings 10 years of experience as president of his own advertising

and marketing firm to Pratten Properties. He is an accomplished

entrepreneur, marketing expert, graphic designer, copy writer, and real

estate investor.

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Big picture thinking and small detail doing.

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Innovation and communication.

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“At every opportunity!”

Career History

Upon completing his undergraduate studies at the University of

Toronto in 1991, Emanuel Arruda opened his own design and marketing

firm in the heart of the city. As President of Absolute Advertising in

Toronto, Arruda provided marketing and communication tools to clients

in Canada, the U.S., and as far away as Iceland, Italy, and Japan.

In 1999, he sold his firm, and for a brief time, provided consulting services

to a competitor. Within six weeks, he streamlined their production and

reduced re-work by 87%. Having discovered his talent for consulting,

Arruda was quickly snapped up by one of the world’s oldest and largest

management consulting firms, and remained there for nearly four years.

During his tenure with the firm, Arruda’s talent for one-on-one

communications, and rapport building came to the fore. Garnering

literally hundreds of major business clients in that short time, Arruda’s

talent was to quickly get to the nitty-gritty of the problems and

impediments to growth facing these small to medium-sized businesses,

and assign specialists to implement custom solutions for them. He

quickly became the top associate in his territory, which spanned from

Toronto to Windsor, and as far north as the French River.

Capitalizing on his profits from the sale of his business, and the travel

afforded him by his consulting work, Arruda began investing privately

in real estate in 1995 and continues to do so to this day. As an investor

in real estate himself, Arruda appreciates the unique nature of property

management and marketing, and uses his skills to develop and maintain

vital systems for communications within our organization, and without.

EMANUEL FURTADO ARRUDA

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Ruby Nishi is an experienced property manager, administrator, and

realtor with a talent for maintaining effective relationships with the

myriad of people occupying the properties in her care. Ms. Nishi

currently holds an unrestricted real estate license which she received

in 1979. In addition, she has earned a diploma in Marketing and

Business Administration, and has a background in real estate office

management, conveyance and administration.

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Doing just what she says she’s going to do.

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“When tenants call just to thank me!”

Career History

Now totalling 25 years in the real estate industry Ruby Nishi brings

with her a wealth of knowledge and experience in residential and

commercial sales, as well as property management. For the past eight

years, she has worked in strata property management, managing

numerous buildings in both residential and commercial strata units.

Nishi is a talented administrator, coordinator, and communicator.

She is responsible for her crew’s coordination and completion of the

countless property management needs for a wide variety of

properties including individual condos, townhouses and houses, as

well as duplexes, multi-unit apartment blocks and large strata

corporations. (That means Nishi is on call 24-hours a day,

every day.)

So, how does she manage to keep everybody so happy? If you can

sense the difference between a

Complaints Department and a

Customer Help Desk, then you have some idea of the value Nishi adds

to the property management division of our organization. One of the

ways she proactively minimizes her workload, is by making it her

business to

personally interview every perspective applicant as they do

an on-site inspection of the property. By carefully matching the right

tenant with the right property beforehand, she increases the likelihood

that our occupants stay put longer. Nishi knows that tenants will

continue to occupy our properties just as long as their needs are being

met consistently and swiftly—so she makes that happen everyday.

That’s not just a skill—it’s a bona-fide talent.

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Mark Wanstall is an accomplished real estate investor, property

manager, project manager, and builder with a talent for generating

‘impossible’ results through his tireless persistence. His adventurous

spirit, extensive network of contacts, and astonishing versatility aid

him in finding winning projects for our portfolio. Wanstall holds a

Bachelor of Science Degree in Geography and is the Director and

majority shareholder of an established real estate holding company.

Relevant Talents and Character Traits include:

•

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orr:: Seeing projects through to fruition.

•

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Versatility. Reliability. Persistence.

•

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“Upon finding an opportunity and seizing it!”

Career History

Since beginning his career in investment real estate in 1999, Wanstall

has accumulated nearly $2.3 million in investment real estate. He’s a

remarkably versatile real estate investor with a talent for creative

thinking and deal-making.

Finding and ‘fixing’ properties with latent potential is Wanstall’s

specialty and, as a rule, he employs a strict “buy and hold” investment

philosophy. Wanstall believes that consistent financial performance

over the life of a property comes from ensuring its current and future

appeal. He also believes that this appeal translates directly to the

rents he can demand as well as the appreciating value of the property

itself. To that end, Wanstall applies his comprehensive maintenance

and enhancement programs to all his investment properties. With 12

properties currently in his portfolio, his results are unmistakable. Each

produces the positive cash flows for himself and his partners—just as

they were intended to do. That’s a track record that speaks for itself.

Guiding people to opportunities is nothing new to Wanstall. Prior to

entering the field of private real estate investing, he rubbed elbows

with a myriad of high profile celebrities, business moguls, and private

citizens while working as an adventure guide at various exclusive

resorts. Keeping his clients safe and happy is just a matter of course

for this highly trained sherpa, and it’s exactly this kind of experience

that makes Wanstall such an important member of our team. He’s

an experienced world traveller, entrepreneur, and investor who is

always at the ready to travel any distance necessary to explore new

opportunities for our investment portfolio.

RUBY NISHI

MARK ORLAND WANSTALL

DEBBIE JEAN GAIT

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For 13 years, Debbie Gait has put her talent for precision, accuracy,

and reliability to work in well-respected realty agencies, charities, and

law firms in both Alberta and British Columbia. As Conveyancer,

Debbie Gait is the link between the lawyers and the realtors, and the

buyers and the sellers. It is because of her diligence and vigilance

that all our transactions precede so smoothly.

Relevant Talents and Character Traits include:

•

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s k

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Getting it right the first time.

•

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Precision. Accuracy. Reliability.

•

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“Smile? When

don’t I smile!”

Career History

Gait first joined Alan Pratten’s team of specialists as the controller

for the company in 1995. Prior to that, she worked independently

for her own roster of clients and adapted her talents for precision,

accuracy, and timeliness according to the needs of her clients. This

included acting as conveyancer and bookkeeper for a prominent

notary public; and bookkeeper for the Canadian Iron and Steel

Industrial Workers Union Local #1 in Victoria, BC. Between 1996

and 2000, Gait worked for two well-respected law firms—further

enhancing her degree of expertise in the areas of bookkeeping and

conveyancing in both real estate and law services fields. In

Edmonton, she was a legal assistant and commissioner of oath for

the Province of Alberta, and she supplied the backbone for the

day-to-day operation of the business.

As the conveyancer and bookkeeper for Pratten Properties, Gait

keeps track of the multitude of details that come part and parcel with

handling rents paid by hundreds of occupants; posting expenses; and

preparing disbursements from the trust accounts of the owners of

the 1100-plus units that are currently owned and/or managed by the

company. For the property management portfolio, she also manages

payables and receivables, and as conveyancer, she prepares and

monitors all real estate listings and deal files, ensures all contracts are

accurate and complete, and that all information is forwarded to the

relevant parties in a timely manner.

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Jennifer Cousins received her diploma for Business Administration

from Camosun College where she immersed herself in Finance,

Statistics, Financial Accounting, Cost Accounting, Communications,

General Management, Marketing, Retail Merchandising,

Organizational Behaviour, Human Resources, Business Law, Money

and Banking, International Business & Trade, and the ever-popular

Macro and Micro-Economics. The knowledge and experience she has

amassed, coupled with her innate talent for diligent tracking and

management of our business affairs, ensures the enduring consistency

and reliability of all our internal and external fiscal reporting.

Relevant Talents and Character Traits include:

•

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Disciplined, focused thinking.

•

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Meticulous and accurate results.

•

Att w

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“When the books balance perfectly!”

Career History

Jennifer Cousins has garnered extensive management experience in the

arenas of accounting for the property management and construction

industries. From 1992 to 1999, she got her introduction to the basics

of bookkeeping and accounting while under the employ of a medium-

sized building and construction supply depot in Port Alice, BC.. As it

was the family business, keeping track of every transaction efficiently

and accurately developed into both a personal and professional habit.

Since that time, she has reached even greater levels of proficiency while

working independently for a number of businesses in the real estate

development sector, providing services in the areas of overall office

management, budgeting, bookkeeping, and development of integral

record-keeping procedures and control systems.

In 2000, Cousins joined Alan Pratten’s organization, and she now

manages and administrates his group of companies exclusively. These

include Exit Realty Abacus, Abacus Properties and various related

businesses and investments. Her responsibilities include: office

administration, budgeting, preparation of corporate financial statements,

as well as supervising the preparation of financial statements for the

property management portfolio. In addition, she also manages corporate

payables, receivables, and monthly bank reconciliations for the corporate

and real estate trust accounts, and prepares for the annual audit.

JENNIFER ELIZABETH COUSINS

THE

GAME

PLAN

How We Run Our Syndications

•

siin

g on prime assets in the residential and commercial sectors;

•

Crre

attiin

g exceptional long-term investments with strong

covenants, long lease terms, and growth potential;

•

ciin

g property returns through active management and

development; and

•

xiim

miiz

ziin

g equity returns through optimal financing and private

syndications.

By exploiting the strong local market knowledge of our experienced

team, and through our strategic alliances and partnerships with

various professionals and private individuals, Pratten Properties is able

to acquire, maintain, and dispose of strategic assets optimally. This

practice enables us to maintain a consistently profitable portfolio,

which is carefully balanced by sector and by geography.

OUR INVESTMENT

STRATEGY

Our long-term policy is to seek high yielding properties and

spreading risk by balancing the portfolio using class and geographical

location. Our investment approach is to concentrate on the

fundamentals of individual assets.

A key criterion is a property’s enduring attraction to occupiers,

because of its business suitability, location and efficiency. As

specialists in their respective industries, Pratten Properties’ team of

professionals has the ability to understand the needs, expectations,

and technical requirements of our clients and tenants. Our property

management division is carefully guided to carry out the specific

improvements we know are necessary to keep our occupants happy,

and that will ensure that we reach our financial objectives.

Leverage is something that gives real estate its advantage over other

forms of investments, but can also create some risk. With prudent

use of leverage, we maximize gains for our investors while insuring

against potential capital loss. In accordance with our internal

investment policies, our standard ratio of debt to equity on any

Pratten Properties syndication qualifies us for the lowest rate of

interest on our mortgages—this is because we work within our

institutional lenders most stringent parameters. As a result of the

lower interest rate attained, we receive the highest spread on the

yield from the property and are able to provide our member-

partners the best cash dividends possible.

In line with our acquisition policy, we always aim to keep our

portfolio of property balanced across the sectors stated below. This

flexible operating strategy underpins our ability to beat the trends

and sustain year on year growth in the long-term, thus enhancing our

market position.

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OUR

OBJECTIVE

Our primary objective is to create long-term and sustainable returns

for our investment partners and our company through our property

investment, development and total property management activities.

Through our proven system of total property management (i.e. the

Pratten

Closed-Loop Management™ program), both the cash flow and

the assessed values of these properties will be improved and maximized.

The aim of our investment strategy is to generate and continually

increase the net income from the properties for distribution to the

member-partners. This net income will be distributed back to our

investors via monthly payments and periodic disbursements from

refinancing on an ongoing basis.

OUR CORPORATE

STRATEGY

Pratten Properties pursues a twofold strategy in the sphere of real

estate syndication: Our first priority is to manage our current property

portfolio in an optimal manner. Secondly, we concentrate on

optimizing our investment portfolio by undertaking selective property

acquisitions and disposals, and by developing new opportunities

(including construction of new buildings as well as the renovation of

older sites) for our private syndication program.

OUR ACQUISITION

STRATEGY

Our acquisition and value-adding strategy has developed over the

last 40 years: We target high yielding investment opportunities in a

range of residential, industrial, and commercial sectors in key

geographical areas. Once acquired, new financial targets are set, the

existing property management personnel are augmented or replaced,

and then actively managed by Pratten Properties’ highly experienced

crews using our own proprietary management system to further

ensure meeting our stringent financial targets.

Our opportunistic but risk-averse strategy seeks to achieve long-term

growth in investment value by:

INTERNAL

CONTROL SYSTEMS

In anticipation of these circumstances, Pratten Properties has

undertaken a comprehensive risk assessment, which has identified

the individual risks that affect the syndicate. We have ongoing

processes and procedures for identifying, evaluating and managing

the significant risks faced by the investments, and we regularly

review and update these processes.

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•

A defined schedule of matters reserved for decision; and

•

A detailed authorization process that ensures that no

commitments are entered into without competent and proper

authorization by more than one approved executive

Our team continuously reviews the effectiveness of our system of

internal control. The responsibility for management of each key risk has

been clearly identified and delegated to specific members of the team.

In order to provide relevant and timely information to the executives

with responsibility for managing risks, the Team has the following

key information systems which generate reports as follows:

•

A management reporting system which includes regular working

capital reports and forecasts;

•

Operational reporting on property purchases, sales and portfolio

management; and

•

And regular reporting to the executives on financial and treasury

matters.

The team considers the risk implications of business decisions as well

as the way each risk is managed. We re-assess these risks on a

regular basis to ensure that any risks arising from changes in our

operations or the external environment are identified and

appropriately managed. The detailed individual risks have been

categorized into the following areas:

•

Property investment and management;

•

Property development;

•

Taxation;

•

Management; and

•

Financing.

The nature of the specific risk areas and related controls are as follows:

USE OF

PROCEEDS

Regardless of the specific business line, Pratten Properties acquires

and develops properties primarily to actively manage and operate

them as income producing, ongoing businesses. Concurrently, we are

regularly exploring new opportunities for income growth from new

acquisitions or development, as well as from providing income-

producing leasing or tenant services.

With a very diverse profile, Pratten Properties offers investors many

alternatives across a broad range of real estate sub-sectors, including:

•

Apartment communities;

•

Senior’s Housing;

•

Shopping centres and malls;

•

Industrial parks and warehouses;

•

Lodging facilities, including hotels, motels and resorts;

•

Medical Centres; and

•

Renewable Energy Power Production Centres (water or wind power).

RISKS AND

OUR CONTROLS

Pratten Properties syndications generate profits for our investors

through long-term investment decisions that will positively affect

both income and capital appreciation. These decisions include

exploiting opportunities arising out of natural market volatility with

respect to supply and demand imbalance in the following core areas:

•

Demand for space from occupiers vs. available and upcoming supply;

•

Differential pricing for premium locations and buildings;

•

Alternative use for buildings (particularly redevelopment);

•

Demand for returns from investors in property, compared to other

asset classes;

•

Price differentials for capital to finance the business;

•

Legislative incentives, including planning consents and taxation; and

•

Economic cycles, including their impact on tenant covenant quality,

interest rates and inflation.

These opportunities can also represent risks: Demand for property

and the ability of tenants to pay rent can be influenced by general

economic conditions at both a macro and local level. Excessive levels

of property supply can also lead to falling rents. Rising interest rates

may affect the security of the tenant base, lower development

margins significantly and reduce investment appetite. Property

values are also affected by changes in planning, taxes, technology,

and lease structures. Interest rates, bond yields and the relative

attractions of other asset classes also impact property values.

Management Risk Controls

Principal Risks

The team is reliant on its small, high calibre team of executives.

Our Principal Controls

These include the assurance that knowledge of all processes and

projects is shared by at least two employees; that the team recruits

and develops high calibre employees; and considers succession-

planning issues.

Financing Risk Controls

Financing risk is spread by using a range of banks and a variety of

types of finance. The maturity profile of debt is managed by spreading

the repayment dates and extending and expanding bank facilities.

Property Investment and Management Risk Controls

Principal Risks

Property values may decline and returns not be optimized;

uneconomic investments may be made or under-performing

properties retained; significant tenant defaults may reduce income

and property values; and property insurance may be inadequate.

Our Principal Controls

These include regular reviews of current and future market

sentiment; reviews of each individual property at least two times a

year including internal and external assessments; considering current

and future values and yield prospects as the basis of sell or hold

decisions; benchmarking portfolio performance against peer groups

using CMHC statistics; consideration of tenant mix covenant

strength across the portfolio; and reviewing insurance cover.

Property Development Risk Controls

Principal Risks

Leasing risk for speculative developments; construction cost and time

overruns; and adverse changes in planning which may cause delay

and affect profitability.

Our Principal Controls

These include limiting the amount of speculative development;

assessing leasing potential and prospective profitability of

developments prior to commencement of construction; on-going

assessment of development expenditure by quantity surveyors with

regular comparisons of costs against budget; and ensuring executives

are kept up to date with planning policies.

Taxation Risk Controls

Principal risks

The investment is exposed to financial risks from increases in tax

rates and changes to the basis of taxation including corporate tax,

GST and PST.

Principal controls

These include regular monitoring of legislative proposals and

participation in discussions with Government directly and through trade

bodies to understand and, if possible, mitigate the impact of changes.

When you have read this informational material in its entirety, just
click this text to download the Executive Summary for our current
syndication project.

PRATTEN’S

INVESTMENT

GUARANTEE

How We Earn Our Share

BUCKING

THE TREND

Rather than taking value before adding any, Pratten Properties

earns its ownership stake

only after increasing the value of the

property and your investment. We earn just 20% of the

increase we create in the income and value of the property

(relative to the income, and equity levels established at the time

of purchase). And, since our compensation is dependant upon

our own performance, you can be certain that we choose each

investment property very carefully, and that the investment

and your returns have our focused attention at all times.

YOUR

R.O.I.

How does this affect your return on investment? Depending

on the investment, our way of doing things can translate to a

savings (and therefore, additional profits for distribution) of 15

to 20% of the initial monthly profit payouts, as well as an

additional 15 to 20% of the increase in equity compounded

annually from the first day the investment is purchased—so

your investment grows bigger, faster.

So, what’s to keep us from inflating the value of the property or

its income? The check and balance that prevents this from

happening is built into our unique investment philosophy, and

it simultaneously creates liquidity for your investment too.

YOUR

LIQUIDITY

We understand that unforeseen personal situations can

sometimes force one or more of our investors to liquidate their

shares sooner than they had originally planned. To provide

assistance in such instances, Pratten Properties maintains a

waiting list of member-partners and prospective members. So,

if you need to sell some or all of your units, we can help you in

the same way a Realtor would help you sell your home.

To ensure that you are receiving the most honest and accurate

value for your units, we use a third-party appraisal to determine

fair market value, and are audited yearly by KPMG — Canada’s

largest and most respected professional services firm. These

mechanisms keeps the syndicate honest, and your investment

secure, accurately priced, and remarkably liquid—you won’t find

that anywhere else.

PRATTEN’S

INVESTMENT

GUARANTEE

You’ve probably heard of ‘one-off’ syndicates that demand an automatic

15 to 25% ownership stake in the property (on top of their acquisition and

management fees) as one of the up-front perks for the General Partner.

Pratten Properties syndications are structured very differently than that.

Typically, syndicators will do things like pad the purchase price and/or take a

substantial ownership bite out of the property as compensation for putting

together the investment. They do this to secure their ‘up-side’ on the front

end of the deal and to eliminate their risk almost completely. If you call

them on it, they’ll tell you that this is simply the “cost of doing business”

with them. As we see it, these are the tell-tale signs of inexperienced or

short-sighted General Partners with a poorly designed syndication plan.

There are a number of reasons we feel this way—the two most important

being that this dilutes the investors’ unit value, and also results in the lack of

built-in motivation for the General Partner to continuously improve the

investment. To begin with, since the investor’s slice of the pie is now 15 to

25% smaller, so are the monthly profit payouts. Which means, all of the

participating investors experience an immediate dilution of their unit value, and

this in turn reduces their overall return on investment. Even worse, the rate at

which the value of their investment appreciates is also stunted by the same

15 to 25%. (In contrast, Pratten Properties syndications are specially selected

and structured to double in value every 3-4 years.)

The real danger for investors involved in this sort of syndication, however, is

that there is no built-in motivation for the General Partner to aggressively

manage and continuously enhance the property after the deal is done. So,

rather than continuously working to increase the value of their investment

beyond the expected appreciation of real estate values, and aggressively

maximizing the investment returns for the investors, the General Partner

remains content with the status quo. So, from day one, the investment is

hobbled and the syndicator’s relationship with the investors is irreversibly

soured—and that’s why they’re called

one-offs: nobody would be foolish

enough to invest with them more than once.

OUR

CREDO

Our Core Values and Beliefs

E B

LIIE

that our word is our bond; it can be trusted. Any

person who does not keep their word, even though they have given it

only by telephone; one who seeks to evade a contract because of

some technicality; or who willfully misrepresents or outright lies, is

reprobate and should be shunned. Such persons will not be tolerated,

and once found out, we will have nothing more to do with them.

E B

LIIE

that it is our ethical obligation as well as our lawful

duty to protect our interests and the investments we administer. We

will prosecute to the fullest extent of the law any who’s willful lies,

misrepresentations, acts of omission, or misconduct cause harm to

our member-partners, our company and its associates, or the

investments in our care. We will vigorously defend our concerns on

behalf of all those who depend on us, and when doing so, we will

retain the best-qualified professional counsel and legal representation

required to guarantee a just result.

INVESTMENTS

& SERVICES

E B

LIIE

that investments in real estate are the surest means of

creating lasting wealth, and that the safest and most direct route of

achieving this goal is through syndicated investments in professionally

managed, high-return real estate.

E B

LIIE

that through our syndicated investments we enable our

member-partners to secure enduring

inter-generational wealth. We

aim to provide our member-partners with an organized system for

managing their wealth across generations—a framework that will

continuously protect and maximize their capital through each

succeeding generation of their family.

E B

LIIE

that for our member-partners to reach their highest

goals, we must offer them the advice and services of in-house and

third-party consultants of the highest calibre. Respected professionals

equipped with special knowledge and experience, who will provide

our member-partners with specific solutions to their individual needs

quickly, objectively, and with complete integrity.

E B

LIIE

that with each investment we initiate and each new

member-partner we befriend, we add strength to the fabric of our

free society. Through such proliferation of enduring familial wealth,

society as a whole may be improved as future generations of our

families are provided the freedom to devote their time to vocations or

pursuits that they enjoy, provide personal fulfilment, and through

which they may contribute to the betterment of humanity.

OUR

CREDO

A concise statement of our core values and beliefs.

PERFORMANCE

& LEADERSHIP

E B

LIIE

in the primacy of the ‘Golden Rule’ and will adhere to

it in all our pursuits. In all our activities we will espouse this tenet:

We will do for others, as we would have them do for us.

E B

LIIE

that in all things we should be the leaders. We should

set the standard against which all others are measured, continually

evolving and seeking to surpass our latest levels of accomplishment.

To lead effectively we must be bold, proud, and above all, free from the

fear of making an honest mistake. When mistakes are made we will

acknowledge them openly, correct them immediately, and look upon

each as an opportunity to gain valuable lessons from the experience.

E B

LIIE

that as leaders we must be right-thinking women and

men of inviolable integrity and sound precepts. It is for every one of us

to make absolutely sure that whatever we do, that our words and deeds

are rooted in the foremost precepts of ethics—even when we are our

only witness. Let us always go by our word: Let our

yes be yes, let our

no be no, and let us make no offer nor promise that lays outside our

domain, or which we know we cannot fulfil.

E B

LIIE

that investing together with a harmonious group of

experts and friends, makes our investments all the more stable,

secure, and—just as importantly—

enjoyable. As long as we remain a

private institution, we shall reserve the right to select, accept and

retain only like-minded, like-tempered, and well-reputed individuals

into our group, whose characters and ideals harmonize with our own.

We will do this with the aim of constantly cultivating a harmonious

environment in which to achieve, while avoiding distractions or

interruptions to our ongoing business operations. When making our

selections we shall not discriminate against any person because of

age, race, gender, disability, religious or spiritual beliefs, familial

status, or national origin.

E B

LIIE

our membership is comprised of extra-ordinary

individuals who are deserving of respect. We respect them foremost

for the effort, care, and constraint it took to produce, accumulate, and

save their investment capital. Having their capital entrusted to our

care, we will manage it with exceptional ability on their behalf. If the

day ever comes that we cannot find a profitable place to invest their

free capital, we shall pay those member-partners out and let them deploy

their funds as best they can. When the time once again comes that

suitable opportunities present themselves, they shall have the first

option to invest, ahead of all others.

E B

LIIE

that every investment project we initiate must succeed.

Accordingly, we will not engage in any activities that lie outside the

professional competence of the acquisition and management teams

we assemble, nor will we begin acquisition procedures until we are

fully confident in our abilities to negotiate, acquire, and continuously

manage the property profitably.

E B

LIIE

that in the sphere of professional investing there is no

place for speculation. Ever mindful of our fiduciary duty to our lenders

and to our many member-partners who have committed significantly

large portions of their net worth to our care, we shall never risk losing

either their invested capital, or their confidence in us.

E B

LIIE

that a fair compensation structure is one that is linked

to the results achieved. To mark our continued commitment to

extraordinary leadership, wherever possible, we will utilize fair

monetary incentives—along with an appropriate system of checks

and balances—to ensure that we remain committed to succeeding to

the maximum degree. We will measure the level of our remuneration

against: the value of the labour we invest in the project prior to

acquisition; the increase in profit and value we create (relative to the

values established at the time of acquisition); the level of risk we

endure or alleviate from our member-partners by our active

participation, management and administration of the investment; as

well as the expertise we supply throughout.

MEMBER-PARTNERSHIP

& FRIENDSHIP

E B

LIIE

that member-partnership and friendship with our

investors brings incalculable rewards to all our investments. By inviting

new friends to become our member-partners, and in turn partnering

with them by re-investing our earned capital alongside theirs, our

interests are always in alignment. United by this philosophy of positive

inter-dependence, we may reach towards ever greater goals, confident

that we share all the same concerns, interests and aspirations.

E B

LIIE

that by continually sharing a greater portion of profit

with our member-partners; maximizing and protecting their invested

capital; and by making available to them the resources of the finest

experts in any field we require, we will continue to attract and

befriend the finest group of like-minded individuals to partner with

us, so that together we may accomplish greater goals and reap

greater rewards than any of us could individually.

When you have read this informational material in its entirety, just
click this text to download the Executive Summary for our current
syndication project.

OUR

COMMITMENT

Fulfilling Our Mission Through Ethical

Standards and Practices.

CONSCIENTIOUS

INVESTING

E B

LIIE

that an honest profit should rest as comfortably on

the conscience as it does on the pocketbook. Remembering always

that our standards and desires are those of leaders, we are committed

to positively affect the communities in which we operate, and the

environment in which we all co-exist.

E B

LIIE

that having safe and pleasant places to live, work,

shop, and relax are a form of wealth that no human being should be

denied. It is the very foundation of a vibrant, healthy society, and

nothing could be more worthy of our attention. Therefore we will

continually strive to make the properties under our care, rate best in

their class. It is our aim to create long-term, compounding

enhancements on the properties we develop and transform, in the

lives and businesses of our clients who occupy our properties, in the

surrounding communities, and on the environment in which these

communities co-exist.

E B

LIIE

that there is a task that no conscientious investor may

shirk: We must endeavour gradually to bring about such a

reconstruction of society that poverty and its attendant evils shall

cease to exist. We must do our part to ensure that future generations

of humanity inherit from us a world that is cleaner, safer, and happier

the one we know now. To this end, we are committed to set aside a

fixed portion of our profits as an investment in the future of human

civilization by providing continuing financial support to select

humanitarian organizations whose core values reflect those in our

credo, who’s financial administrative practices are sound, and whose

mission is to positively and sustainably affect societies around the

world. We will invite our member-partners to do the same.

OUR

COMMITMENT

A brief statement of our standards and practices.

KNOWLEDGE

& COMMUNICATION

E B

LIIE

that as leaders in the investment community we must

continue to operate our business affairs with transparency, and in the

light of accurate knowledge. We will keep our member-partners

informed of material facts and events that directly affect their

investment. We will do so in a manner that is clear, fair, truthful,

timely, and complete. Additionally, in the spirit of equity towards all,

we will publish our latest opportunities and announcements to relevant

parties simultaneously, by whatever reasonable means available.

E B

LIIE

that along with a foundation of unshakable trust and

accurate data, strong member-partnerships require ongoing up-to-

date information. To aid both new and alumni member-partners alike,

we will continually create, provide, and recommend materials,

systems, or services, that will further aid our friends to understand

and differentiate the investment opportunities we offer them.

E B

LIIE

that informed member-partners can be relied upon to

make their investment decisions quickly and independently when

they are presented with all the necessary facts. To that end, we will

present all our investment opportunities factually, plainly and free of

conjecture, opinion, and rhetoric. In this light, each of our member-

partners can then easily weigh for themselves the merits of each

investment we initiate. When the time comes for their decision, their

confidence will rest comfortably on their own firm understanding of

the investment opportunity at hand, rather than having to rely on

emotional appeals or second-party speculation.

When you have read this informational material in its entirety, just
click this text to download the Executive Summary for our current
syndication project.

FREQUENTLY

ASKED

QUESTIONS

upside before, think of it as diamonds lying buried and hidden under

layers of grime and stone—our crew mines, cuts and polishes them

to realize the full potential of their value.

y d

o y

u s

ett m

xiim

s ffo

orr y

urr iin

sttm

ntts

The reasons are twofold: Before anything else, we want to encourage

even our most ardent investors to always use prudent

money-

management techniques and diversify their holdings.

Secondly, it is important to keep in mind that we set out to make

new friends not new friend. If we allowed one or two deep-pocketed

investors to acquire all the units in our syndications, it would take us

much longer to cultivate the number of member-partners we need to

achieve our goals.

n II iin

stt d

diirre

cttlly

y ffrro

m m

y R

No. However, even though you may not invest from your RRSP

directly, some Pratten Properties member-partners have used the

services of bond underwriters to access their RRSP money without

paying the withdrawl tax.

w iitt w

orrk

s::

A bond underwriter will issue you an RRSP-eligible bond, and then

provides you with a loan (outside your RRSP, and at a reasonable

rate) that is secured against the bond—all without having to pay

withdrawal tax. Their bond earns you a slightly lower rate of return

than the loan they provide, but you can use this freed up cash to

invest in any of our syndications and leverage your invested funds

over and above the interest rate paid on the loan. As a nice bonus,

since the interest paid on the loan is tax-deductible, it provides

another opportunity to significantly enhance your overall after-tax

return on investment.

Working with a bond underwriter allows member-partners to:

•

convert their under-performing RRSP funds to Limited Partnership

units in any Pratten Properties syndication in as little as 7 days;

•

eliminate the 10% RRSP withdrawal tax and avoid paying income

tax on the withdrawn funds;

•

enjoy a 4% tax credit that they can apply to other personal income

every year;

•

realize a tax-efficient return on their newly liberated capital.

If you wish to wish to use your RRSP contributions to enlarge your

ownership position, you are invited to contact us any time.

FREQUENTLY

ASKED

QUESTIONS

o y

u e

err rre

uiirre

e a

a m

miin

niim

m iin

sttm

ntt?

No. We have never set minimum investment requirements for any of

our syndications, nor do we intend to do so in the foreseeable future.

Pratten Properties was founded on the belief that our relationship

with our member-partners is

much more important than any principal

amount they choose to invest with us in any one project.

w c

n y

u a

affffo

orrd

d tto

o c

siis

stte

nttlly

y o

offffe

err s

h h

hiig

h rre

ettu

urrn

We have constructed our organization from the ground up to do the

following things better than anyone else: To find, qualify, acquire, and

manage the most profitable real estate properties and syndications

anywhere.

In combining the unique skills and experiences of our team leaders

and staff, we have spared no expense to build (from scratch where

necessary) whatever software, hardware, knowledge-base, and human

resource infrastructure requirement needed to capture the best of our

experience and skills, and breathe them systematically into our

business. With this ‘backbone’ supporting our efforts, we are able to

accomplish greater results faster than any other investment group.

But perhaps the simplest reason is that, unlike most syndicators who

specialize in acquiring “shelf properties” that can be managed “right

out of the box,” we at Pratten Properties are devoted to rolling up

our sleeves and getting our hands dirty rejuvenating tired properties

that have unrealized potential—also known as ‘upside’. (See:

Pratten’s Investment Guarantee). If you’ve never heard the term

(Note: Currently, the average decision time for members to

participate in a newly offered syndication group is less than 5 days

from the time they first receive their Executive Summary to the time

we receive their Notice of Interest. This time is likely to drop as it

becomes more difficult to find good deals and as we have more

distributable cash from refinancings that we must re-invest for our

current member-partners.)

w lla

arrg

e iis

s y

urr tte

errrriitto

orry

For the time being (or until a particularly good opportunity presents

itself) we prefer to focus on real estate within Canada. We believe that

Canada’s strong economy, stable political system, and its abundance of

natural resources, make it the best place in the world to invest in real

estate. In addition, by investing in our own country, we eliminate any

risk that could result from exposure to currency fluctuations.

att a

arre

e y

urr c

crriitte

erriia

a ffo

orr c

siin

g w

hiic

h p

prro

errttiie

s tto

o s

diic

atte

Every prospective syndication projects must share all of these traits

in common:

•

The property must pass our rigorous due-diligence process that not

only discloses all manner or potential risks, but also determines the

maximum price we can offer and still achieve the 15%-25% ROI our

member-partners have come to expect.

•

There must be no risk of loss of our member-partners’ capital.

•

The property must provide our member-partners a tax-efficient

investment. In particular, we aim to achieve regular income that is

partially or completely sheltered from taxation, provides tax-

efficient disbursements during refinance periods, as well as

preferential tax treatment on investment income and unit value

increase.

•

Prior to making an offer to purchase, the property must already

show a

positive cashflow that achieves a net income yield that is a

minimum of 3% greater than the monthly payments for the first

mortgage.

•

The property must demonstrate the potential for increase in value

by at least 10% annually. This increase potential is must be

directly attributable to factors controllable by our management

team—

not speculative market factors.

•

The property must have un-realized potential (commonly called,

Upside). This potential can take many forms. For example: zoning

that allows for further development or redevelopment; room for

rent increases; aesthetic or structural improvements which upon

completion and reappraisal would add immediate value; and,

improvements in management systems or personnel.

y d

o y

u c

allll y

urr iin

stto

orrs

s,, ““m

err--p

arrttn

errs

s””?

We invite new friends to become our members, and we in turn

partner with alongside them by investing our capital alongside theirs

in Limited Partnership units just like theirs. Any ownership of units

held by directors or staff of Pratten Properties are in the form of

personally held Limited Partnership units having the same rights and

restrictions as any of our member-partners.

att a

arre

e y

urr c

crriitte

erriia

a ffo

orr m

errs

hiip

Because syndications are by nature group investments, we believe

that the more our group members have in common and the more

their interests align, the more stable and predictable the investment

will be. So, before we take you on as a new member-partner, we

want to speak to you personally and even meet with you face-to-face

if possible. If things proceed from there, we will next speak with the

references you supply. If we all agree that there’s a good ‘fit’, you will

be accepted as a new member-partner of Pratten Properties. It may

seem a little out of the ordinary when compared to the common

investment houses, but ours is a

private investment firm, and being

so allows us the freedom to be as old-fashioned (and cautious) as we

wish to be.

s a

a L

Liim

miitte

d P

arrttn

err,, w

att d

o II a

cttu

alllly

y o

In a Limited Partnership form of syndication, your interest in the

property is an indirect one. (This legal structure protects every

Limited Partner from liability). Title to the property is registered at

the Land Titles office in the region in which the property is located,

in the name of the General Partner who holds title in trust for the

Partnership. The Limited Partnership Agreement and the names of

the participants are registered with the BC Securities Commission.

Upon successful closing of the property, our lawyers provide each

member-partner with a copy of the title for their records along with

their unit certificate.

o A

Allu

nii M

errs

s g

ett tth

e ““ffiirrs

stt llo

k”” a

att n

w o

offffe

erriin

Yes. One of the greatest advantages of having an established

relationship with Pratten Properties is that our Alumni Members get

a 48-hour advance notice at all new investment opportunities.

During this period they (and any close friends and business associates

that our members may wish to introduce to us) are offered the

opportunity to participate prior to public notice being given. Once

this period expires, we next offer the units remaining un-subscribed

(if any) to pre-qualified prospective members.

order to earn our share in ownership. For more information on this,

see

Pratten’s Investment Guarantee.

n tth

e G

P b

y u

p m

orre

e a

d m

orre

e u

niitts

s a

d b

e m

orre

e ““p

errffu

ull””?

The General Partner will never own units in any syndication. Any

ownership of units held by directors or staff of Pratten Properties will

be in the form of

personally held Limited Partnership units having

the same rights and restrictions as any of our member-partners.

w m

h o

off m

y iin

sttm

ntt iis

s tta

n o

utt iin

n ffe

? H

w m

h iis

s lle

efftt

orrk

kiin

g ffo

orr m

Pratten Properties does not take any ownership up front so all of

your money is working for you from day one, and your units are not

diluted by even a single penny. We are committed to maintaining

transparency for our member-partners, so we disclose individual fees,

disbursements, commissions, etc., in every Offering Memorandum

for every syndication we initiate.

o y

u e

err d

d c

h--c

alllls

s tth

att rre

uiirre

e tth

att tth

e L

Liim

miitte

d P

arrttn

errs

iin

stt m

orre

e m

No. There will be no cash-calls. If project requires additional funds at

a later stage, we will offer a new block of Limited Partnership units.

Our alumni members would be offered the first option to purchase the

newly offered units at the current value, then any new units left

unsubscribed would be offered to members of other Pratten Properties

syndication groups, and finally to qualified prospective members.

att h

s tto

o m

y iin

e iiff tth

e p

prro

errtty

y b

urrn

s d

n a

d tth

niin

g c

All our properties have income insurance coverage—paid for by the

tenants—that will continue to provide you your income until such

time as the building is replaced and the income stream is recovered.

o y

u e

err s

d d

diis

sttrriib

uttiio

n o

off c

hffllo

w tto

o tth

e L

Liim

miitte

d P

arrttn

errs

No. We have a contingency fund in place to prevent such an occurrence.

Each month we distribute 90% (depending on certain factors—like

the size of the largest tenant) of the net cashflow of the property to

our investors. The 10% not distributed is put into a reserve fund to

smooth out any inconsistencies in cashflow disbursements that may

come up if a tenant leaves and is not immediately replaced. When a

level deemed appropriate is reached, the balance once again is added

to the member-partners’ monthly disbursements.

o m

s tth

e p

prro

errttiie

s tth

att a

arre

e u

err P

Prra

atttte

n P

Prro

errttiie

s’’

miin

niis

sttrra

attiio

You wouldn't leave your baby in the care of a stranger, and neither

would we. No matter the distance from our headquarters, every

property we acquire on our member-partners behalf is under the

managerial direction of Pratten Properties at all times. After all, our

compensation depends on it. (See: “Pratten’s Investment Guarantee”)

att iis

s tth

e ““C

Cllo

d--L

p M

ntt™

™”” s

stte

Our proprietary method of management and control is our little

secret. It keeps our employees and contractors honest, efficient, and

on their toes!

n a

d h

w s

ulld

d II c

h o

utt?

It depends on the deal. For every new syndication project, we publish

Executive Summary. In it we include details of the various events

we plan that will trigger the re-appraisal and re-financing of the

property. (See,

Pratten’s Investment Guarantee). It is recommended

that you plan your strategy around these events. You may wish to

discuss your options during your complimentary planning session

with KPMG.

w ‘‘lliiq

uiid

d’’ iis

s m

y iin

sttm

ntt?

Unforeseen personal situations can sometimes force one or more of

our investors to liquidate their holdings sooner than they had originally

planned for. To remedy this, Pratten Properties has in place a unique

buy-back program to help investors cash out of their positions when

unforeseen circumstances arise. For more information on this, see

Pratten’s Investment Guarantee

o d

ciid

s tth

e v

allu

e o

off tth

e u

niitt w

n a

a L

Liim

miitte

d P

arrttn

err w

ntts

s o

utt?

To ensure that you are receiving the most honest and accurate value

for your units, we use a third-party appraisal to determine fair market

value. This mechanism keeps the syndicate honest, and keeps your

investment secure, accurately priced, and remarkably liquid. If an

investor is forced to liquidate their holdings in between refinancing

periods, the current value is assessed based on the change between

the net incomes of the property on day the units are sold, from the

day the units were purchased.

att p

errc

ntta

e o

off o

errs

hiip

p d

s tth

e G

P tta

e u

p ffrro

ntt?

Zero. We believe we must add value to an investment property in

First of all… Thank you for the compliment!

Our teams of experts have all worked diligently to make our organization

just as “good” on the inside as it seems on the surface. Everyone in

Pratten Properties’ organization, from the founding partners to the

resident managers, as well as our legal team and their counterparts at

KPMG, were invited to work with us because they share the same

passion for perfection in their work, as we do in ours. If that sounds

“old-fashioned” to you, again we thank you.

w o

offtte

n d

o y

u k

p iin

n tto

h w

wiitth

h y

urr m

err--p

arrttn

errs

It is our custom to proactively keep members informed of important

new developments pertaining to their investment, so that they are

never left wondering what’s going on at your investment property. By

means of general newsletters, as well as timely letters and

announcements, we actively take it upon ourselves to keep you abreast

of the significant events that affect your investment as they happen.

We do this proactively so that we can continue to focus on one

important thing: managing the investment rather than the investor.

att w

wiillll m

y a

ntta

ntt n

d tto

o k

For some of you, this will be your first experience with a privately

offered investment and thus your first exposure to an offering

memorandum and risk acknowledgement form. Private investments

offering profit potential such as ours have historically been reserved

for individuals classified as “Accredited” investors. This accreditation

refers not only to the level of their wealth, but also to their ability to

acknowledge the risks and benefits associated with private

investments. Pratten Properties believes that it is important for each

of our new members to become familiar with the language and

structure of a private offering document. By educating yourself in

these matters you qualify yourself to participate in other exceptional

private investment offerings when they become available.

You may require professional counsel to explain certain elements of

these documents. It should be noted however, that not all lawyers or

accountants have the experience or qualifications required to advise

you adequately. If you are unsure about the level of sophistication of

your legal and accounting representation, we have taken steps to

assist you. Our Lawyer will make himself available to discuss any

questions that your lawyer may have regarding these documents.

In addition we have asked our accountants at the Victoria branch of

KPMG (the Largest Public accounting firm in Canada) to make select

members of their team available to advise you at your request. (This

consultation will be at the expense of Pratten Properties.) They are

uniquely able to provide you (or your accountant) with specific

strategies on maximizing the tax efficiency of this investment in your

portfolio that your accountant may not by privy to.

IItt s

s tto

o g

d tto

o b

e ttrru

e..

Although this is technically not a “Frequently Asked

Question,” we

hear this comment from prospective members often enough that it

makes sense to address it here…

When you have read this informational material in its entirety, just
click this text to download the Executive Summary for our current
syndication project.

TTRACTIVE

LTERNATIVE TO

THER

NCOME

EHICLES

Comparable Market Statistics (As of April 25, 2005)

R.O.I. Yield

(Compounded Annually)

Canadian Money Market Fund

2.50%

Canadian 1-year Treasury Bills

2.75%

Canadian Government Bonds

2.90%

Stock Index

5 - 8%

Private Mortgage Investment

7 - 11.5%

Pratten Properties Syndications

15% plus

IGHER

ETURN AND

OWER

ISK THAN OTHER

NVESTMENTS

•

Returns are in the range of 15% plus.

•

Investments are secured by tangible and quantifiable assets as collateral.

•

Investors are protected against principal debt.

•

Rigorous due-diligence process includes mandatory third party appraisals, and, where

appropriate, environmental reports and engineering reports.

•

Interest yield enhanced through prudent use of leverage.

•

All prospective acquisitions or disposals will be subject to the review and unanimous approval

of Pratten Properties’ Investment Committee, prior to making any investment in, or

acquisition of, a property.

•

Generally, the property sector is relatively independent of other stocks and of bonds, and

produces an attractive return comprising of capital appreciation and cash flow.

AVINGS

•

Investments can be RRSP eligible.

•

Profit disbursements can be paid out in a form which is not taxed as highly as regular income

or gains from interest or dividends.

•

Due to the tax-efficient nature of a Limited Partnership Syndication, a 10% Pratten Properties

return will out-perform a 15% stock-market return after tax.

•

Investors are able to write off a proportionate share of the expenses and depreciation of the property

to further reduce their taxable income. This can mean significant tax benefits for the investor.

IIN

VEESSTTM

MEEN

NTT H

HIIG

HLLIIG

HTTSS

ROVIDES A

ONSISTENT AND

EGULAR

UARTERLY

ASH

ISTRIBUTION

•

Attractive yield relative to other income funds with a targeted annual cash yield of 8 to 15%.

•

Distributed cash is paid monthly and is expected to increase every year.

•

Overall return on investment in the neighbourhood of 15% plus..

XPERIENCED

NVESTMENT

ANAGER WITH AN

STABLISHED

RACK

ECORD

•

The Investment Manager is President and Chief Executive Officer of Exit Realty Abacus.

Mr. Pratten lends over 40 consecutive years experience as an entrepreneur of real estate

business including sales and leasing, construction, and property management.

•

The Investment Manager is an experienced real estate developer and has actively developed

and redeveloped income properties for over 40 years.

•

The Investment Manager has personally been investing in income properties for over 38 years and

owns significant income property both on his own and in partnership with other private investors.

•

The Investment Manager is a licensed real estate agent in the Province of British Columbia.

•

The Investment Manager is a member of the Victoria Real Estate Board, and a commercial

division member and a Certified Commercial Investment Member candidate.

•

The Investment Manager is experienced in all areas of the construction industry.

•

The Investment Manager owns and operates a leading property management firm in Victoria, B.C.

and is knowledgeable in all areas of property improvement, rehabilitation and management.

XPERIENCED

EAM OF

PECIALISTS

•

See Biographies beginning on page 24 of this booklet entitled ”THE TEAM LEADERS”.

AILOR

-M

ADE

NVESTMENT

OSITIONS

•

At the option of the investor, a consultant at KPMG will meet with investors on a one-on-

one basis for the purpose of structuring the investment to create maximum yield for each

individual investor.

•

This consultation will be at the expense of Pratten Properties, and not the investor.

SPEAK WITH US

PERSONALLY

We thank you for investing your time to acquire and study this

information. When you are ready, click this link to download the

Executive Summary for our current syndication project.

If you still have questions left unanswered, or wish to be considered for

membership in one of our private syndications, my partners and I are

happy to make time to speak with you on the telephone, or in person.

Your inquiry is invited with the assurance that it will receive prompt

and expert attention. Our team is ready and able to assist you in

achieving your highest real estate investment goals.

Thank you.

Alan Pratten

President and CEO

Adam Gant

Partner - Capital Development

Emanuel F. Arruda

Partner - Communications & Operations

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