Lizzie Bilocura

1 The Opportunity Stanfield Team Verticals Capital Composition Construction Vertical 2 THE PROBLEM With a few exceptions, current CRE Tech VC Model prioritize financial returns to its investors --- Emerging Weakness Financial return perceived by VC’s diverges from maximum operational benefit to investors. The Opportunity: Create a capital investment model Investments stray from investors’ operational priorities – but investors asked to adopt anyway to realize Fund’s financial returns. where operational benefit and the dialog among pro-active investor/operators drives Too many investors (strategic and financial) to effectively participate in key decisions. investment … 3 Needed: An Alternative to the Typical VC Fund Model With collegially minded Strategic Partner/Investors with overlapping operational challenges…. Stanfield Partners: Unique Non- VC Approach Key Features of Partnership • Needs defined by partners guide Stanfield • Non-competing real estate investment priorities types • Small group = close communication • Culture of pro-active dialog • RFP’s issued to solicit relevant Strategic Partners Viatechnik technology solutions Construction Co • Pro-active dialog and collaboration • “Laboratory Environment” leads to long term involvement with • Emphasis on both direct responsive entrepreneurs operational value & financial return • Consultative decision-making process “Secret Sauce” • Construction Company is hybrid – strategic partner and advisor • Viatechnik brings 1800+ engagement tech implementation experience – serves advisor and partner thru Stanfield • Special Resources: Stanford connection (AI, Machine Learning, data science) • Value to operations of Strategic Partners is measured • Adoption by Strategic Partners creates operational and financial return 4 Special Opportunity for the “Right” Construction Company… This is a very unique opportunity to develop a deep relationship with 4 – 5 major owner-developers (est. combined $100B+ AUM) in the course of identifying, vetting, and implementing new “design/construction” technology investments in an intimate recurring setting where ideas emanate from one of three general directions: 1 2 3 • From the outside in where a startup has an idea that may address a problem experienced by a major owner/developer somewhere in the construction process; • An owner/developer expresses a problem/challenge that needs to be addressed; or • An Advisor (including Construction Company) can surface for consideration technology successfully applied by others. 5 The Investment Partnership 6 Why Stanfield? 1. Absolute Domain Expertise. Decades of C-Level relationships and repeat transactions – no one else has this. 2. Long Term C-Level Relationships with Key Users. These long-term relationships are broad and founded on repeated successes: Essex, Kilroy, CBRE, Equity Office, The Irvine Company, Boston Properties, Shorenstein, ViaTechnik, and Trammell Crow. 3. Long-term Relationships Produce Winners. These major companies are all product users/validators. 4. Industry Prominence. Principals combine extensive real estate careers with 6-year commitment to Real Estate Technology industry resulting in representation on elite ULI, CRE Tech, and Stanford-based leadership councils. 5. Focus. SP has selected four verticals where it has years of experience and where there is unique integration and synergy. 6. Fully Identified Investment Candidates. SP has already selected multiple platforms to partner and invest in based on its focus on this emerging industry. 7 STANFIELD PARTNERS PRINCIPALS The THE PRINCIPALS OF STANFIELD HAVE UNPARALLELED RELATIONSHIPS, TRANSACTIONAL AND OPERATIONAL EXPERIENCE AT INDUSTRY, COMPANY, PROJECT AND PORTFOLIO LEVELS David Knowles T E A M Focus: Market Data, AI & Tokenization Co-Head of Salomon Brothers Global Real Estate Investment Banking Department Head of Merrill Lynch’s Western U.S. Real Estate Investment Banking Department Leader in creating the global REIT and CMBS markets with transactional experience approaching $100 billion. Clients include the largest and most successful global real estate owners and developers including multiple IPO's and M&A transactions. Founding Board Member, CFO & Chairman of the Innovation Committee for Stanford Professionals in Real Estate Leadership Board Member of CRE Tech Inaugural Member of ULI Technology Council. 8 STANFIELD PARTNERS PRINCIPALS The THE PRINCIPALS OF STANFIELD HAVE UNPARALLELED RELATIONSHIPS, TRANSACTIONAL AND OPERATIONAL EXPERIENCE AT INDUSTRY, COMPANY, PROJECT AND PORTFOLIO LEVELS Gregg Young T E A M Focus: Construction Trammell Crow Partner, Dallas Office Building Division Founding Partner, TCC Corporate Services – outsourcing corporate real estate function for Fortune 500 Companies. “Hands On” CEO, COO, CIO, and CFO roles for several private real estate investment firms, ranging from $500M to $1.2B in AUM. Led acquisition, disposition, entitlement, master planning, refinancing efforts. Board of Advisors for VIATechnik - a premier global construction technology firm. 9 STANFIELD PARTNERS PRINCIPALS The The THE PRINCIPALS OF STANFIELD HAVE UNPARALLELED RELATIONSHIPS, TRANSACTIONAL AND OPERATIONAL EXPERIENCE AT INDUSTRY, COMPANY, PROJECT AND PORTFOLIO LEVELS Eli Khouri T E A M Focus: Smart Buildings Recently CEO of Equity Office. Executive VP and CIO of Kilroy Realty. CIO of Spieker Properties. Involved with acquisition and development of over $5B of office and industrial assets. Co-founded Broadreach Capital Partners, a private real estate firm. Director of Vesta Industrial, a leading developer and operator of industrial properties across Mexico. 10 STANFIELD PARTNERS PRINCIPALS The The T E A M THE PRINCIPALS OF STANFIELD HAVE UNPARALLELED RELATIONSHIPS, TRANSACTIONAL AND OPERATIONAL EXPERIENCE AT INDUSTRY, COMPANY, PROJECT AND PORTFOLIO LEVELS Henry Elder Focus: Real Estate Blockchain Founder of Digital Asset Advisors President, International Blockchain Real Estate Association Tokenized one of the first commercial properties in the US as part of the Slice.market team Previously completed over $1 billion in commercial value-add investments at George Smith Partners and Latitude Real Estate Investors (Now Lasalle Mortgage Real Estate Investors) 11 STANFIELD PARTNER ADVISORS Over 100 Years Commitment to the Global Real Estate Industry JULIA ARLT Global Digital Real Estate Leader - PWC Innovation real estate director at PWC Involved in real estate tech start-ups in Europe GARY BEASLEY Co-Founder & CEO, Roofstock, Real Estate & Technology Platforms Current Co-Founder and CEO of Roofstock Previous Co-CEO of publicly traded Starwood/ Waypoint Residential Trust CEO of Joie de Vivre Hospitality and solar start-up Greenvolts MERRIE FRANKEL President/Founder, Minerva Realty Consultants, REIT Ratings & Advisory Agree Realty Corporation- Board Director NYU & Columbia- Adjunct ProfessorCapital Markets ULI Trustee Startup Bridge Mentor, MetaProp NYC President and CFO of ZipRealty Senior Moody's REIT Analyst Co-Founder, FUTURE: PropTech Principal at KSL Resorts (backed by KKR) Argo Funds Portfolio Manager Experienced in fund-raising for Property Tech companies in Europe LaSalle Partners Security Capital Group JP Morgan, Salomon Brothers Officer Real Estate New York- Women of Distinction 12 STANFIELD PARTNER ADVISORS Over 100 Years Commitment to the Global Real Estate Industry MICHAEL BECKERMAN CEO, CRE Tech Real Estate Tech Startups, Incumbents, & Advisors DANIELLE DY BUNCIO President/CEO, VIATechnik Construction + Technology Founder & CEO, VIATechnik, Premier Global Construction CEO of CRE Tech Founder/CEO of The News Funnel Technology Firm representing clients in over 1,500 engagements Founder, Beckerman Public Relations Board of Directors, Ryan Companies US (Minneapolis) Building Design+Construction Magazine, "40 Under 40, 2018“ 2017 Constructech "Top Women Consultants in Construction" 13 4 VERTICALS OF FOCUS & HOW THEY INTEGRATE/OVERLAP Our 4 verticals have significant overlap which produces multiple synergies Construction Data & Analytics + Smart Buildings 3D Virtual Design (BIM) provides the skeleton for integration of Asset Management and Smart Building devices including IoT sensors which capture data related to operations and tenant satisfaction. + Construction The Data and Analytics vertical is positioned to disrupt the construction industry by providing those who apply machine learning and AI to data to gain an advantage in cost savings and labor efficiency. Construction + Blockchain Smart Contracts + Blockchain/Tokenization Facilitates Data Analysis and Record Keeping, paving the way for new, complementary fractional interest markets. Blockchain/Tokenization + Data & Analytics The basis of Blockchain technology by generating increased transparency through the use of distributed ledgers, timestamped entries and identity verification should facilitate the creation of new, complementary capital markets. Data & Analytics Smart Buildings Digitization is being used to automate payment for performance of tasks in construction contracts at all levels. +Data and Analytics Blockchain/ Tokenization Machine learning is being applied to period construction data and combined with market area activity levels to significantly improve project cost estimates. Smart Buildings + Blockchain Smart Building systems can benefit from the use of Blockchain technology, including building security and validation, timestamped data events, centralized documentation, and inventory management. 14 STANFIELD Investment Partnership CAPITAL COMPOSITION (Approximately $100 million) Structured to Maximize Partnership Success and Partner Dialog “Best of Class” Strategic Partners – 50% * Dominant Office REIT Dominant MF REIT Dominant West Coast Mixed Use Owner Leading Global Industrial REIT Major Construction Company/Developer Co-GP’s (Approx. 50%) *Targeting ultra-high class companies with premier operating histories and where Stanfield principals have significant track record of success and decades long relationships. 15 STANFIELD Investment Partnership CAPITAL COMPOSITION (Approximately $100 million) Key Success Drivers 1. Co-GP - First-time combination ❑ CRE and Capital Markets expertise/relationships ❑ “Best in class” VC 2. Strategic Partner Role - Investments selected for adoption in Partner Portfolios. 3. Focus - 4 Synergistic Verticals ❑ Market Data and Analytics (including AI) ❑ Smart Buildings ❑ Construction ❑ Blockchain/Tokenization 4. Pro-active Role for Strategic Partners - Active dialog prior to each investment. 5. Not a Blind Pool - 5 pre-identified Lead Investments. 6. Excellence & Diversity - Prominent advisors specializing in 4 focus areas. 16 The Construction Vertical 17 Why the Construction Vertical is Important to our Strategic Partners? THE CHALLENGE For CRE owners, meeting investor expectations is becoming harder and harder. Growth Pressure: Need to grow 8-12% / year Construction Costs: Rising 6-8% / year Skilled Labor Shortages: prevalent condition Lagging Rent Growth: Rents up only 2-3% / year THE SOLUTION: CRE Tech is emerging as a lever to reduce costs and alleviate labor shortages. 18 ROLE OF CONSTRUCTION PARTNER Construction Partner would be actively involved across investment roles in Construction Vertical. Partnership Meetings / Calls Needs Assessment Investment Priorities Strategic Partner Managing Partner Deal Flow Qualification / Vetting Potential PostInvestment Board Roles optional Coordinates Coordinates Consensus Consensus Construction Partner (only 1) Help define Help define optional Viatechnik Help define Help define optional 19 Construction Technology Investment Categories Team will need to allocate Partnership Resources for Construction Vertical across these technology groups based on Partner Needs Analysis (Pain Points), Priorities and ROI Potential for Strategic Partners, as well as Scalability and Broader Market Potential … • Collaboration Software • 3D Visualization • Offsite Construction • Drones & Aerial Intelligence • Robotics • Construction Data • Project Management • Building Materials • Mobile • Equipment Sharing • Cloud • Supply Chain Management • Marketplace Platform • Compliance • Monitoring & Safety • Financial Management • BIM 20 USE A DIFFERENT INVESTMENT PROCESS Enterprise-Level Tech Capital Budgeting Approach vs. Marginal Benefit Approach 1. Build Consensus on Priorities based on Cost Reduction, Revenue Generation, and ESG potential 2. Rank technologies based on operational impact (short term, long term) & TAM potential 3. RFP to leading companies; assess a. Long term viability of tech / team / current capital sponsors b. Platform v. Point Solution and Integration Strategy c. Workflow change needed to adopt d. Investment Upside and Operational ROI for our partners 4. Select best in class tech / company for category 5. Facilitate adoption by Partners 6. Measure/Share Actual Results and Tips among Partners 7. Modify Implementation as Needed 21 Example – Case Study – Construction Progress Use Case Annual Construction Spend – Strategic Partners: $8B (est.) Annual Commercial US Market: $1T (2018 Est) Global Construction Market: $12T (est. 2022)* Major Competitors combining BIM with laser image overlay technology Chart Units Ai - Driven Problem Addressed Doxel.ai Alternative Approach Ltd Ai Openspace Ai Holobldr Reconstruct • Ai – driven identification of construction errors (deviation from plans) Shift in Vision: From shared documentation to real-time kaizening thru Ai • Identify Schedule Deviations • Platform for Job Coordination Meetings Constrctn Company Viatechnik No RFI Hybrid/ offshore End of job scan Hybrid / offshore ? aspiration aspiration no aspiration • Accurate “As Built” Record Set Key Factors • Data Capture (separate human task req’d?) No-robots No-Helmet Y-Laser/360 Cam Y-Laser/360 • Accuracy (Measurement, Object Recognition) n/a • Easy to Use ? ? ? ? ? ? • Customer Service Effectiveness ? ? ? ? ? ? Brick & Mortar Cultivation Capital n/a n/a Sponsorship Doxel Robot Open Space.Ai Lux Capital • Lead Investor A16z • Cumulative Raise $4.5M $17.5M $2.9M $10.1M n/a n/a • Last Round $4.5M $14M undisclosed $7.7M n/a n/a 8/19 5/19 n/a n/a • Close of Last Round *Construction Intelligence Center forecast • Strategic Partners none Suffolk; Tishman Speyer; JLL • Use of Funds seed +Computer vision none 22 End of Slide Deck – Extra Slides beyond here 23 Hold for FAQ - TERMS of Partnership: under discussion with Major Investors but we expect to track market Key Terms likely to include: Investment Partnership (not a Fund) – very simple documentation Raise Target: $100M; smaller, earlier closing a possibility 2% of raise to support Stanfield operations Target Financial Return: 3 - 3.5x 24 Why a Construction Company Should Focus on Real Estate Technology Technology improves, enhances, and facilitates value components both of the main aspects of the asset, (1) the location, (2) the physical/material composition of the actual property. Technology is everywhere today and is vital for all asset classes, definitely including Real Estate. Since Technology has the ability to change jobs there is in all industries a frequent reluctance to address and incorporate it all decision making. When real estate companies, both owners and construction companies do address technology it tends to get siloed and isolated within the company structure. 25 Why a Construction Company Should Focus on Real Estate Technology Asset Value Enhancement. Technology enhances value components of the asset – both the location and physical/material composition Technology is ubiquitous today - vital for all asset classes including Real Estate. Since Technology has the ability to change jobs there is in all industries a frequent reluctance to address and incorporate it all decision making. When real estate companies, both owners and construction companies do address technology it tends to get siloed and isolated within the company structure. 26 How might a Construction Company best incorporate Technology into its ”forward thinking?” An outside team comprised of professionals with similar profiles and company objectives has demonstrated itself in other industries to be the best, and sometimes only, way to address the inevitable role that Technology will play in the company’s business future. A team, by definition, has multiple members and almost always is a superior approach provided there is good communication between all team members. A team of outsiders has been demonstrated in real estate tech to be the best way to initiate, encourage and adopt new ideas and approaches into a “too traditional/not “forward thinking” mindset. Brainstorming with open-minded major owner/developer/builders from different companies has been proven to be much more productive than just attempting to precipitate change within a single entity/company structure. 27 Education & Associations David Knowles Experience Corporate Clients 28 Education & Associations Gregg Young Experience Corporate Clients 29 Why Commercial Real Estate Tech & Why Now? The culture and willingness to adapt to change and technology in the global real estate industry has been absolutely constrained. The real estate mindset is adverse to change because merely being in the right markets with the right products produces many millionaires/billionaires. There is only one dedicated VC that has raised over $100M in funds compared with other industries that have multiple individual funds/VC with over $1B raised. 30 Why Commercial Real Estate Tech & Why Now? There is a comparatively tiny group of broadly-defined commercial real estate technology startups that have raised more than $150M including WeWork, Katerra, and VTS. And only VTS has raised capital from investors with meaningful experience in commercial real estate. Real Estate is the most financially underserved industry within venture capital, by a gigantic margin, i.e., the largest industry in the world has the least venture money both in absolute and percentage terms. The commercial real estate industry is finally starting to recognize that technological evolution is inevitable. For example, conferences on the topic that had 50 attendees 4 or 5 years ago now have 1,000+ attendees. 31 SYNERGY Complementary backgrounds provide the opportunity to immediately become a major force in Commercial Real Estate Venture Platform Investing Stanfield Traditional VC Strategic Financial Domain Expertise Industry-based Relationships to Gain Adoption & Deal Flow LP’S VC Infrastructure Post Investment Involvement/Adoption User Adoption Employing Long-term Relationships 32 LANDMARK PROPERTIES SOLD, FINANCED, OR DEVELOPED BY MEMBERS OF STANFIELD PARTNERS 605 Third Street 55 Water Street Mandarin Oriental Hotel Breckenridge/Steamboat PGA West, La Quinta Resort, Carmel Valley Ranch La Costa Resort 33 LANDMARK PROPERTIES SOLD, FINANCED, OR DEVELOPED BY MEMBERS OF STANFIELD PARTNERS Murdock Plaza Chrysler Building Olympia & York Portfolio Transamerica Pyramid Bank America HQ 34