Six Peak Capital - Weekly L10

• The meeting reviewed development financing status, operator selection, construction contracts, and several administrative actions related to ongoing projects.
• Financing: The preferred-equity investor referred to as LLJ is showing progress and Genesis Capital remains engaged on the debt side; Genesis may also provide mezzanine capital.
• Appraisals are still outstanding and are required to complete underwriting.
• Chris reported that higher rent assumptions improved underwriting but achieving those rents is uncertain; project funding is considered better-than-even versus two months ago.
• The team agreed not to take substantive steps until a signed term sheet; a term-sheet condition requiring a nonprofit and CMFA grant could delay the timeline by roughly six months.
• Operator selection and approvals: Chris summarized the ED1 tenant approval process and risk that Urban Futures (UFBA) can delay approval absent an automatic approval mechanism.
• Tom and Derek described Adaptive’s prior management of an 86-unit comparable deal with ~10-day turnaround when applications are complete.
• The group prioritized an experienced on-site property manager, tasked Tom to request formal proposals from Adaptive and at least two other operators, and set Derek and Chris to prepare the Pitch presentation aimed for summer to allow Pitch diligence and operator selection by roughly January.
• Construction, contracts, and procurement: Hillman construction contract exhibits and outstanding items are expected to be completed this week.
• Schuyler will focus the next six weeks on signing LOIs with three to four GCs/design-build firms and is working with Gores Group to secure materials at cost; Arrow is confirmed as construction architect on one proposal and West of West as design architect.
• The team discussed holding shoring numbers for Scott, excluding a transformer vault and shoring cost from an estimate, and accelerating hiring and producing a draft budget/GMP through Claude as a placeholder if a term sheet arrives.
• Land pricing observation: a purchased lot (3626 Watt Sika in Palms) was listed for sale.
• Regulatory and fundraising: Schuyler reported the TEFRA public hearing is scheduled for Thursday and bond counsel expects no issues; receipt of TEFRA approval plus a mayoral letter and city council motion will permit fundraising to begin.
• Schuyler entered a UCLA City Lab case competition application that could provide favorable construction financing and requested project history and selective financials from Bob to support that application.
• Administration, agreements, and claims: Bob finalized two agreements but several signatures remain, including Justin Kruger’s on the co-invest agreement.
• The bank is withholding a Khalifa job payment because two conditional waivers were submitted instead of one combined waiver; a participant offered to combine the PDFs and resubmit.
• The team reviewed an email seeking the subcontractor responsible for decks/patios and separation details for 2022 and beyond; a participant will call to clarify alleged patio defects before escalating.
• A participant requested a copy of a Copilot camp / 401(k) document.
• Pipeline and other items: Stein declined a proposed pre-development equity role on Borden and lacks deployable cash until Francis closes, leaving guarantees and a potential MRK–Aaron partnership as remaining levers.
• Work is underway to re-form an architecture arrangement with Adam and Tag using Adam's license for Third Street and Reseda.
• No final decisions were made on pending financial close actions.

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