Brook Hollow Business Plan : simplebooklet.com

Confidentiality Statement: The information contained in this business plan is confidential and to be used only for the purpose of reviewing the private placement memorandum regarding the investment described herein. This document must not be transmitted, or reproduced, nor must any information contained or incorporated by reference in it be made available to any other person or company or used for any purposes other than determining whether or not to make an in investment with the company described herein.Risk Disclosure: Prospective investors should be aware that purchasing an interest from the company is speculative and involves a high degree of risks. Please review the company’s private placement memorandum for additional risks and conditions of this investment.Forward Looking Statements: While the company believes the assumptions and forward-looking statements contained in this business plan are reasonable, the company cannot guarantee future results, performance or achievements. Anticipated returns, expense estimates and investor distributions discussed in this business plan are based on the management’s assumptions and beliefs and are not reflective of past operations of this company or the property.No Reliance on Prior Performance: There can be no assurance of any investment objective described herein, and the past performance of any person or business venture should not be relied upon for the success of any investment, including the investment described herein.Photos for Illustration Purposes Only: The photos contained herein are not included as guarantees or exact representations of the plans for the project investment described herein. The actual completed project may vary materially from any illustrationincluded in this business plan.DMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793Brook Hollow Apartment HomesDisclaimers

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Brook Hollow Apartment HomesInvestment Overview (DMI Brook Hollow, LLC)Exit Options• Operate for 2-5 years and sell • Refinance the property hold for cashflowInvestor Terms(Class A)• 8% Preferred Return• 50%/50% Split with Sponsors after PrefInvestment TargetsIRR17-24%Time3-5+ yearsMultiple2-2.6XDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793DMI Brook Hollow, LLC• 28 Class A Units• $100,000/unit• $2,800,000 maximum offering amount(Maximum)• Accredited Investors Only

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Project Highlights• DMI Brook Hollow LLC, will invest into Class A units of GVD Brook Hollow, LLC• Project Timeline- Construction began February 2023- Leasing anticipated to begin in February 2024- Full stabilization (95% occupancy) anticipated December 2024• Cash flow anticipated to begin in Q1 2025• Multiple exit strategies- Sell after Occupancy has stabilized- Refinance into new loan once the prepayment penalty has been reduced and beneficial debt is availableBrook Hollow Apartment HomesProject OverviewBrook Hollow Site PlanDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793

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Brook Hollow Apartment Homes Overview• 216-unit Class “A” development on 7.63 acres• 1 bedroom/1 bath, 744 square foot average unit size• 2 bedroom/2 bath, 1,094 square foot average unit size• Unit Mix- 41% 1 bedroom/1 bath- 59% 2 bedroom/2 bath• 9 Three-story garden style buildings with stainless steel appliances, granite countertops, faux wood plank flooring and 9’ ceilings with crown molding• Amenities include business center, playground, fitness center, dog park, club house and electronic security gating• Located at 6731 Southwest Parkway, Wichita Falls, TX 76310.Brook Hollow Apartment HomesProperty OverviewClubhouse at Hyde Park Apartments in Denison, TX. Completed August 2020DMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793

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Brook Hollow Apartment HomesUnit MixDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793Unit type Unit Count Sq. Ft. Rent $ Rent per Ft.1 Bedroom/ 1 Bath 36 656 1,095.00$ $1.671 Bedroom/ 1 Bath 36 744 1,199.00$ $1.611 Bedroom/ 1 Bath 18 775 1,275.00$ $1.652 Bedroom/ 2 Bath 54 990 1,375.00$ $1.392 Bedroom/ 2 Bath 36 1094 1,495.00$ $1.372 Bedroom/ 2 Bath36 1194 1,595.00$ $1.34Total (Average) 216 909 1,339.00$ $1.50Year 1

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Brook Hollow Apartment HomesFloor Plans1 Bedroom 1 Bath 656 Square Feet - $1,095/Month1 Bedroom 1 Bath 744 Square Feet - $1,199/Month1 Bedroom 1 Bath 775 Square Feet - $1,275/Month2 Bedroom 2 Bath 990 Square Feet - $1,375/Month2 Bedroom 2 Bath 1,094 Square Feet - $1,495/Month2 Bedroom 2 Bath 1,194 Square Feet - $1,595/MonthDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793

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Brook Hollow Apartment HomesProject StrategyBrook Hollow brings a luxury community to Wichita Falls, Texas, which has had no recent multifamily development. There will be nothing in the market with the quality or amenities this new property will offer. Despite the lack of quality, local competitors are often fully occupied. Nearby cities give a strong indication of potential rents. Nearby Markets• Henrietta – 19 miles• Seymour – 52 miles• Lawton, OK – 51 miles• Ft Worth – 114 milesNote: Occupancy and Rent information obtained from online marketing sources and phone calls during April 2022DMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793

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Brook Hollow Apartment HomesWichita Falls, TX• Wichita Falls, TX is populated with entrepreneurs,families of all ages, young professionals, collegestudents, military families, airmen in training, andartists! Walk to the Falls, walk the historicdowntown to see the renowned World's LittlestSkyscraper and dine on local cuisine. DowntownWichita Falls is a must-visit destination for thecraft beer, wine and coffee enthusiast.• Population = 102,988* in 2021• Rental households represent 43%• Median household income in 2021 = $47,443*• Nearby major employers***Source:*www.census-gov/quickfacts/wichitafallscitytexas**www.wichitafallschamber.com/community-profile/Stonebridge Apartments Homes Completed April 2022DMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793Empoyers # EmployeesSheppard Air Force Base 7,222Wichita Falls Independent School District 2,378United Regional Health Care System 2,100Midwestern State University 1,276

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Brook Hollow Apartment HomesProforma and TermsCapitalization• $39,249,092 project cost• $27,887,800 debt• $11,362,000 equity- $8,612,000 from investors- $2,750,000 from managersEquity Uses• Land cost - $930,000• Organizational Costs- $125,000• Builder’s fee - $1,900,000• Development cost - $750,000• Hud Required Reserves - $2,667,410• Remaining Cash Required- $4,989,590HUD Loan Terms• Interest Rate = 6.04%• Term = 40 Years• IRR eligible- IRR is the Interest Rate Reductionprogram available through HUDallowing a reduction in rate if availableDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4791Year 1 Year 2 Year 3 Year 4 Year 5REVENUEMarket Rent 3,492,288$ 3,597,048$ 3,704,959$ 3,816,108$ 3,930,591$ Vacancy Losses (174,614)$ (179,852)$ (185,248)$ (190,805)$ (196,530)$ Total Rental Income 3,317,674$ 3,417,196$ 3,519,711$ 3,625,303$ 3,734,062$ Other Income 199,000$ 199,000$ 199,000$ 199,000$ 199,000$ Total Income 3,516,674$ 3,616,196$ 3,718,711$ 3,824,303$ 3,933,062$ EXPENSESProperty Tax 485,000$ 499,550$ 514,537$ 529,973$ 545,872$ Franchise Tax 25,167$ 26,162$ 27,187$ 28,243$ 29,331$ Insurance 145,000$ 149,350$ 153,831$ 158,445$ 163,199$ Payroll 200,000$ 206,000$ 212,180$ 218,545$ 225,102$ Utilities 95,000$ 97,850$ 100,786$ 103,809$ 106,923$ Property Management Fee 105,500$ 108,486$ 111,561$ 114,729$ 117,992$ Administrative Costs 60,000$ 61,800$ 63,654$ 65,564$ 67,531$ Marketing 10,000$ 5,150$ 5,305$ 5,464$ 5,628$ Constract Services 30,000$ 30,900$ 31,827$ 32,782$ 33,765$ R & M Materials30,000$ 30,900$ 31,827$ 32,782$ 33,765$ Total Operating Expenses 1,185,667$ 1,216,148$ 1,252,693$ 1,290,335$ 1,329,107$ Expense Ratio 34% 34% 34% 34% 34%Net Operating Income 2,331,007$ 2,400,048$ 2,466,018$ 2,533,967$ 2,603,955$ Reserves 43,200$ 43,200$ 43,200$ 43,200$ 43,200$ Asset Management Fee 52,750$ 54,243$ 37,187$ 57,365$ 58,996$ Debt Service 1,861,562$ 1,861,562$ 1,861,562$ 1,861,562$ 1,861,562.00$ Net Cash Flow 373,495$ 441,043$ 524,069$ 571,841$ 640,197$ Debt Service Ratio 1.25 1.29 1.32 1.36 1.40Projected Cash Flow

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Brook Hollow Apartment HomesIncome Projections*Notes:1. Years 1 and 2 include return of capital from unused reserves that are planned to be returned once HUD releases them.2. Sale proceeds include return of capital.3. Year 1 is after Construction is complete, Construction is expected to take 18 month.4. ROI is Return on Original Investment; IRR is calculated with 6 cashflows$100,000 Investment Example with 4% Rent GrowthDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793$100,000 Investment Example with 6% Rent GrowthCap Rate Construction Year 1 Year 2 Year 3 Year 4 Year 5 Sale Proceeds* Total Cash Multiple IRR4.50% $193,410 $233,655 2.3 21%5.00% $173,443 $213,688 2.1 19%5.50% $157,106 $197,352 2.0 17%ROI 14.7% 11.9% 3.9% 4.5% 5.2%$5,205$100,000 Class A Investor Example~18 Months$14,690$11,921$3,936$4,493Cap Rate Construction Year 1 Year 2 Year 3 Year 4 Year 5 Sale Proceeds* Total Cash Multiple IRR4.50% $212,551 $257,424 2.6 24%5.00% $190,439 $235,312 2.4 22%5.50% $172,347 $217,220 2.2 20%ROI 14.7% 12.3% 4.8% 5.9% 7.1%$7,145$100,000 Class A Investor Example~18 Months$14,690$12,340$4,821$5,878

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All income and expenses will flow through to investors through a K-1 and each investor’s share will be calculated based on their ownership. Investors will also get their share of depreciation which may create passive losses. We intend to take advantage of ‘cost segregation’ for the depreciation, and the 45L tax credit if it is available to us. Cost SegregationBy segregating the different types of assets in the project and then depreciating them on the most advantageous schedule, we expect to see large passive losses during the initial years of operation. These losses may be able to be used against other passive gains or carried forward to future years. When the property is sold, we expect these losses to be recaptured. 45L Tax CreditThe 45L tax credit allows taxpayers to claim potentially significant credits for the construction of new energy-efficient homes. Each dwelling or residential unit must have a projected annual heating and cooling cost that is 50% below the annual energy consumption level of a comparable dwelling unit.Please consult your tax professional to know how these details effect your personal tax situation. These tax strategies are dependent on IRS rules and regulations and may be changed. Brook Hollow Apartment HomesTax ConsequencesDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4793

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Brook Hollow Apartment HomesPrevious Development Properties by Dixon Adams CompanyDMI Brook Hollow, LLCInvest@dmi-mgt.com(972) 386-4791*reported as of 4/1/2023Property Name Location Units Completed Occupancy* Current Status Investor InformationTimber Creek Sulphur Springs, TX 88 January 2013 *Sold* Sold April 2021 No outside investors in propertyCypress Creek Mount Pleasant, TX 120 October 2016 *Sold* Sold June 2021 Investor IRR ~28% and 2.25X MultipleBridges On Travis Sherman, TX 226 January 2018 *Sold* Sold October 2018 No outside investors in propertyPine Creek Paris, TX 136 January 2019 *Sold* Sold June 2021 Investor IRR ~24% and 2.1X MultipleWillow Creek Palestine, TX 136 April 2020 *Sold* Sold November 2021 Investor IRR ~14% and 1.5X MultipleHyde Park Denison, TX 128 August 2020 93% Stable Operation Rents 17% above projectionsCedar Springs Corsicana, TX 148 June 2021 96% 11% higher rents Reserves Partially Returned and Cashflow ~9%Stone Bridge Lufkin, TX 168 April 2022 98% Stable Operation Rental Rates 12% higher than projectionsCross Timbers Greenville, TX 216 Expected March 2023 35% In Leaseup 38% Leased, Rental Rates 27% above projectionsPebble Brook Jacksonville, TX 128 November 2022 59% In leaseup Rental Rates 9% higher than projectionsDeer Park Athens, TX 128 Expected June 2023 In Construction Leasing begins Q1 2023Hyde Park Phase 2 Denison, TX 96 Expected December 2023 In ConstructionHarvest Creek Marshall, TX 148 Expected December 2023 In ConstructionBrook Hollow Wichita Falls, TX 216 Expected Q1 2025 In Construction

Brook Hollow Business Plan

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