Synopsis  This  document  describes  the  basic  models  used  in  Community  or  “Crowdsource”  funding  for  Real  Estate  investments.    It  has  been  written  to  provide  the  layman  with  a  simple  and  clear  introduction  to  the  process  and  how  the  various  parties  interact  throughout  the  process.    It  is  meant  as  introduction  only  and  as  such  is  not  exhaustive.  We  would  be  pleased  to  speak  with  anyone  considering  this  option  and  to  discuss  real  examples  of  how  investments  have  performed  and  strategy  has  been  modified  in  light  of  changing  economic  circumstances.    

L u x u r y   S i m p l i f i e d ,   9 5   B r o a d   S t ,   C h a r l e s t o n ,   S C ,   2 9 4 0 1

Community  or  “Crowd-source”  Investment  Structures  

Community  or  “Crowdsource”  Investment  Structures.  “A  qualified  group  of  contractors,  brokers  and  financial  analysts  based  at  95  Broad  St,  Charleston  SC.  Our  experience  in  infill  development  on  the  historic  Charleston  Peninsula  has  set  us  apart,  developed  strong  community  relationships  and  a  strong  investment  pipeline.  “  

Track  Record  An  effective  Real  Estate  investment  strategy  has  enabled  us  to  contribute  to  and  benefit  from  the  development  boom  that  that  has  engulfed  Charleston  over  the  past  three  years.    A  total  infrastructure  and  capital  investment  north  of  $1  Billion  on  the  Peninsula  alone.    As  one  of  the  largest  historical  renovation  and  redevelopment  firms  in  Charleston,  we  have  amassed  a  land  bank  of  approximately  50  building  opportunities  within  the  rapidly  developing  Downtown  corridor  South  of  Highway  17.    

To  date  some  $30  million  has  been  invested  to  produce  a  market  beating  return.    Land  on  the  Peninsula  has  become  a  premium  asset  during  this  timeframe  and  is  a  valuable  commodity  now  that  the  construction  market  has  returned  in  full  force.      

In  addition,  an  influx  of  job  creation,  primarily  in  the  technology  sector,  growing  student  populations  and  a  large  teaching  hospital  complex  have  driven  demand  for  housing.  Our  goal  is  to  help  meet  this  demand.    

Our  investment  strategy  for  the  Charleston  marketplace  has  evolved  over  the  last  few  years  and  as  market  

conditions  have  changed.  

From  buying  distressed  residential  property  for  the  rental  market  in  Mount  Pleasant  and  the  Barrier  Islands  to  buying  vacant  land  and  renovation  opportunities  in  developing  downtown  neighborhoods  then  to  developing  our  own  downtown  PUD  and  Event  Space  opportunities.    At  each  stage  we  have  examined  returns  on  a  bi-annual  basis  and  reformatted  strategy  to  suit  market  conditions.  

Figure  1 - Company  offices  at   recently  renovated  95  Broad  Street, Charleston  SC.  Built  circa  1770.

The  map  above  shows  properties  we  have  “touched”  in  the  recent  past.  Either  to  renovate,  restore,  rent.  Buy/Sell  are  not  included  and,  as  such,  many  remain  within  our  current  portfolio.    Some  represent  work  under  contract  to  third  parties,  some  our  within  our  own  property  portfolio  as  shown  in  the  key.    

Community  or  “Crowdsource”  Funding  Mechanisms  The  purpose  of  this  White  Paper  is  to  provide  a  quick  overview  of  Community  Funding  mechanisms,  as  they  exist  today.  It  concludes  by  considering  how  this  is  targeted  at  investment  opportunities  in  the  downtown  Charleston  Real  Estate  marketplace.    

Online  SyndicatesThree  parties  are  involved.  The  Investor  who  supplies  the  funds,  Syndicator  who  most  often  uses  a  web  based  portal  to  reach  their  investor  pool.    They  promote  the  offer  and  manage  release  of  funds,  overseeing  the  deal  throughout  the  lifecycle,  but  at  a  cost.  A  local  Contractor(s)  who  undertakes  the  build-­‐out  and/or  management  phase  but  without  a  direct  connection  to  the  Investor.    The  Contractor  works  with  the  Syndicator  on  a  fee  or  more  often,  significant  portion  of  the  deal  equity,  basis.    Syndicators  like  Reality  Mogul,  iFunding  and  RealCrowd  typify  this  model.  

Placement  Agents  Placement  Agents  are  similar  to  a  Marriage  Bureau.    They  play  matchmaker  between  the  investor  pool  and  potential  investors.  They  act  as  Broker  Dealer  of  record  in  the  transaction  and  must  be  SEC  registered.    Basic  Due  Diligence  (DD)  is  required  as  part  of  their  function  both  around  the  deal  and  the  Operator/Contractor  or  offering  entity.    The  advantage  for  the  Operator/Contractor  is  that  after  they  have  completed  the  necessary  DD  then  payment  ongoing  is  dependent  upon  delivery  of  funds.    A  transaction  fee  is  also  levied  though  this  has  only  marginal  effect  on  an  inherently  robust  offering.    

The  offering  itself  can  be  more  flexible,  for  example  on  a  debt  or  equity  basis  or  as  a  revolving  development  fund.  Fundrise  is  an  example  of  this  model.  Turnstone  Securities  are  another  of  the  newer  entrants  bringing  a  similar  offer  targeted  at  their  existing  highly  networked  investor  base.  

Vertical  IntegrationVertical  Integrators  are  similar  to  Syndicators  but  also  add  additional  value.    The  typical  model  is  vertical  integration  of  the  financial  management  platform  with  the  investment  being  delivered  via  independent  contractors  on  site.  Prodigy  Network  is  an  example  of  this  business  model  from  the  standpoint  of  a  financial  platform,  its  one  of  the  more  successful  and  dynamic  on  the  market.      Care  needs  to  be  taken  during  DD  process  though  as  the  Integrator  has  opportunity  to  increase  margins  at  the  various  pinch  points  in  the  process  so  should  be  viewed  end  to  end  and  not  on  the  basis  of  any  particular  stage.  

Lead  Generation  &  White  LabelThese  are  probably  the  most  common  new  entrants  in  the  marketplace.  They  connect  investors  directly  with  developers.  They  often  have  little  or  no  execution  capabilities  beyond  that  and  a  low  barrier  to  entry.    Be  careful  is  our  steer.    In  recent  history,  the  SEC  has  placed  some  focus  on  these  operations  due  to  poor  legal  adherence  and  business  practices.    

White  Label  has  is  not  being  discussed  in  detail  in  this  document  as  it  is  an  offer  that  can  basically  mirror  any  of  the  three  above  and  is  targeted  at  the  investment  community  as  an  operating  platform  for  them  to  enter  this  space  or  wishing  to  expand  an  on-­‐line  presence.    

Our  Position  We  have  structured  an  offer  that  is  a  union  of  the  Placement  Agent  and  a  Vertical  Integrator.  The  investor  has  a  vertically  integrated  offer  inclusive  of  both  the  financial  and  delivery  sides  of  the  deal.    We  can  spot,  purchase,  develop,  lease  and  sell  under  the  same  corporate  structure.    In  addition,  the  proven  track  record  of  Luxury  Simplified’s  existing  investment  portfolio  in  the  downtown  Charleston  SC  market  will  provide  investors  with  the  confidence  they  require  to  participate  in  this  innovative  approach  to  property  investment.  

So  How  Does  this  work  in  Reality?    In  essence:  Turnstone  Securities  are  our  funding  partner  in  this  exercise.  They  provide  due  diligence  audit  for  the  investor  and  oversee  finances.  They  reach  out  to  the  potential  investor  pool,  control  the  release  of  funds  and  investor  reporting.  Luxury  Simplified  secure  development  opportunities  pre-­‐funding,  design,  build  and  manage  properties  in  downtown  Charleston.  They  oversee  ongoing  community  and  City  relations.  

Trust  and  transparency  Great  real  estate  investments  do  not  have  to  be  complicated.    Our  job  is  to  demystify  the  intricacies  of  profitable  property  investment.    Here’s  how  we  do  it…..  .    We  will  identify  AND  often  secure  the  investment  opportunities  before  funds  are  released  by  Turnstone  Securities.  In  fact,  Luxury  Simplified  has  secured  a  considerable  land  bank  of  opportunities  in  downtown  Charleston  over  the  past  24  months.    The  power  of  Social  Media  is  such  that  you  can  track  the  development  in  real  time  and  watch  it  develop.  

Trust  from  our  investors  is  paramount.    By  partnering  with  Turnstone  Securities,  Investors  will  receive  the  highest  level  of  commitment  and  the  utmost  financial  transparency  throughout  the  project.  In  fact,  our  investors  receive  their  returns  before  any  other  party.  Financial  reports  will  be  provided  regularly  throughout  the  project,  highlighting  key  targets  and  milestones.    We  encourage  our  investors  to  visit  Charleston,  at  various  stages  of  the  project,  or  monitor  the  progress  on  social  mediums  (e.g.,  Luxury  Simplified  YouTube  channel,  Pintrest,  or  private  Facebook  groups).  We  are  a  vertically  integrated  real  estate  company  with  no  hidden  fees  or  other  charges  at  any  point  from  land  acquisition  to  rental  management  or  final  sale.  

Escrow  Release  &  Closing  Once  the  funding  targets  are  reached,  Turnstone  Securities  will  release  funds  from  escrow  to  begin  the  construction  process.  Acquisition  and  planning  phases  will  already  be  substantially  complete  by  that  point,  minimizing  delay.  

Construction  We  are  one  of  the  largest  residential  construction  and  historic  renovation  companies  in  the  Charleston  market  place.  We  know  our  business  well.    Planning  a  renovation  or  new-­‐build  residential  project  takes  between  3  and  6  months  from  initial  discovery,  project  planning  and  design,  BAR  (Board  of  Architectural  Review)  and  permitting.  The  actual  build-­‐out  phase  takes  a  further  4  to  6  months.    

To  mitigate  risk,  the  entire  construction  process  is  overseen  by  Turnstone  Securities  and  is  treated  in  a  similar  fashion  to  a  commercial  construction  loan.  Funds  are  released  as  the  buildu out  progresses.  

Cash  Flow  Distribution  Once  construction  is  complete,  our  Real  Estate  arm  will  rent  and  manage  the  property.  Charleston  has  a  high  demand  region  for  rental  properties  fuelled  by  the  City’s  large  food  and  beverage,  college  and  hospital  communities.  Cash  flow  from  rental  income  is  distributed  to  investors  twice  per  year  by  Turnstone  Securities.    Once  the  projected  cash  flow  objectives  have  been  achieved,  the  investment  will  be  sold  and  equity  returned  to  the  investors.    

In  Closing  Luxury  Simplified  is  a  company  with  in-­‐depth  experience  in  the  Charleston,  SC  property  investment  arena.    In  fact,  we  have  invested  our  own  funds  to  build  a  sound  and  lucrative  property  portfolio.  Our  investors  can  rest  assured  that  their  funds  are  being  managed  by  professionals,  dedicated  to  generating  a  healthy  rate  of  return.  Invest  in  something  you  know,  can  touch  and  feel  with  the  certainty  of  all  the  information  you  need  at  your  fingertips.  

Disclaimer  This  presentation  has  been  prepared  by  LS  Group  (“LSG”)  for  the  exclusive  use  of  recipient  (together  with  its  subsidiaries  and  affiliates,  the  “Recipient”)  using  publicly  available  information.    LSG  has  not  independently  verified  the  information  contained  herein,  nor  does  LSG  make  any  representation  or  warranty,  either  express  or  implied,  as  to  the  accuracy,  completeness  or  reliability  of  the  information  contained  in  this  presentation.    Any  estimates  or  projections  as  to  events  that  may  occur  in  the  future  are  based  upon  the  best  judgment  of  LSG  from  publicly  available  information  as  of  the  date  of  this  presentation.    Nothing  contained  herein  is,  or  shall  be  relied  upon  as,  a  promise  or  representation  as  to  the  past  or  future.  LSG  expressly  disclaims  any  and  all  liability  relating  or  resulting  from  the  use  of  this  presentation.  

This  presentation  has  been  prepared  solely  for  informational  purposes  and  is  not  to  be  construed  as  a  solicitation  or  an  offer  to  buy  or  sell  any  securities  or  related  financial  instruments.    All  securities  are  offered  through  LSG  partner,  Turnstone  Securities  LLC,  member  FINRA  |  SIPC.    The  Recipient  should  not  construe  the  contents  of  this  presentation  as  legal,  tax,  accounting  or  investment  advice  or  a  recommendation.    The  Recipient  should  consult  its  own  counsel,  tax  and  financial  advisors  as  to  legal  and  related  matters  concerning  any  transaction  described  herein.    This  presentation  does  not  purport  to  be  all-­‐inclusive  or  to  contain  all  of  the  information  which  the  Recipient  may  require.    No  investment,  divestment  or  other  financial  decisions  or  actions  should  be  based  solely  on  the  information  in  this  presentation.    

This  presentation  has  been  prepared  on  a  confidential  basis  solely  for  the  use  and  benefit  of  the  Recipient.    Distribution  of  this  presentation  to  any  person  other  than  the  Recipient  and  those  persons  retained  to  advise  the  Recipient  is  unauthorized.    This  material  must  not  be  copied,  reproduced,  distributed  or  passed  to  others  at  any  time  without  the  prior  written  consent  of  LSG.