Experiencedproperty advisors

LEVEL 3, 50 CARRINGTON STREET SYDNEY 2000

INFO@ESHO.COM.AU | (02) 8502 - 3113

Over the past 10 years, the Esho team has advised hundreds of clients on more than $517mworth of investments. We know that every single investment decision is important to ourclients, regardless of how large in site.

Property investing is a big decision and that is why we have built a unique process to helpsimplify the property investing process, yet with the highest regard to research and analysis.

The most important part of investing is understanding the underlying asset. Australianresidential property is estimated to be worth around $6 trillion - three times as much as theentire poor of superannuation assets in Australia and up to four times the value of the entirestock market. Yet many investors go about their property purchasing without the same levelof sophistication. Our research and buying process helps solve this problem.

Our entire process starts with the end in mind – challenging your way of think to define yourgoals and ambitions. We then overlay this with our industry best practice researchmethodology, developed after working with some of the largest global financial servicescompanies in the world.

We take pride in our qualifications and our investment track record. That is why the Eshoteam is often invited to comment in the mainstream media – our comments and insights aresought regularly because we get straight to the point.

We look forward to working with you.

Property Investment; Powered By AnExperienced Team of Advisors

The Esho team is focused on building a moresophisticated, tailored and research based approachto property investing. We've developed our ownunique process, backed by the latest research andanalysis.

We make sure each client conversation is focusedon building long-term relationships. We lookforward to speaking with you, helping develop anddeliver your investment goals.

Peter Esho | Founder, Esho Property Group

Australian residential real estate has been one of the best performing and most stable assetclasses over the past decade. The total value of Australian residential real estate is estimatedat around $6 trillion as of June 2015. To put this number in perspective, the total value of allfunds held in superannuation was around $2 trillion during the same period while the valueof the entire Australian stock market was somewhere close to $1.6 trillion.

This shows that Australian residential property is worth around three times the total value ofsuperannuation assets and up to four times the total value of the stock market. Not only isresidential real estate the largest single asset class in the country, it has also been one of themost consistent performers in terms of annualised returns.

According to RP Data, an average of all major Australian cities showed dwelling pricesincreased by around 5.5% annually over the past ten years. This annual rate of growth isabove inflation and GDP growth during the same period. Keep in mind, this includes theunusual events of the 2008-2009 global financial crisis which saw stock market tumblingaround the world.

The Esho team has analysed Australian residential property prices since the mid-19thcentury. Our analysis shows that residential property prices follow interest rate cyclemovements. When global bond yields rise, property prices plateau. But even in periods of flatgrowth, the major metropolitan Australian cities have reported rates of capital growth at orslightly in excess of inflation consistently.

Historical Performance of AustralianProperty; What the Numbers Say

According to RP Data,Australian dwelling priceshave risen by an average of

around 5.5% over the past 10years to the financial year

ending 2015.

The most important part of our process issetting the foundation. To be successful,investors need to challenge theirtraditional "way of thinking"

Thinking over a ten or twenty year periodmakes a huge difference. This is how thesmartest investors embrace the market.They may occasionally consider marketmovements in the short term, but usuallythey don’t worry or let these movementsimpact their judgement. They focus on thebig picture.

This is very much confirmed by officialstatistics which come out every year fromthe Australian Taxation Office.

The most recent numbers published showthat around 7.9% of Australians own morethan one property. If you investigate a littlefurther, only 0.43% of the population ownthree or more properties and a tiny 0.16%of the population own four or moreproperties.

The difference between these investorsand the other 99% of the population is their‘way of thinking’ and focus on long terminvesting.

Some people might not aspire to ownseveral properties, but for those who enjoygrowing their investment, having the right‘way of thinking’ is the difference amongthe top 0.5% who own three or moreproperties in Australia.

Your "Way of Thinking"Makes the Difference

0.43 %

The AustralianTaxation Office

estimates only 0.43%of the entire

Australian populationown three or more

investmentproperties

Our team works with investors who want todevelop, maintain and expand their ‘way ofthinking’. After decades of advisingdomestic and international clients, we havedeveloped a very rigorous researchmethodology based on the right "way ofthinking".

We look at many factors across the world,we pinpoint key growth areas acrossAustralia and then we drill down intoindividual investment opportunities.

We reject around four out of every fivedeals which come through our office, butthat leaves us with high qualityinvestments. We then introduce these toour clients.

If you’re serious about your propertyinvestments – ask yourself these twosimple questions: what’s your goal andwhat are you doing today to achieve it?

Most people don’t know the answer, Wehelp in discovering, developing andimplementing both of these two keyquestions. It takes time, but an investorwithout a goal is like a driver without co-ordinates to their destination, they willonly drive around in circles and never getto where they want to go.

Without a plan, investors always get lost.

Planning Your PropertyInvestments

20%

Only one out of everyfive properties weseriously evaluate

will meet ourrigorous researchmethodology. Weonly pick the best.

Our clients are generally successfulindividuals, family-offices or companieslooking to expand or better manage theirproperty portfolio. We help build theirplan.

The Esho team not only provides the rightplanning advice but also the strategyaround structures, to ensure clients achievethe most optimal results. The first meetingis a starting point of a longterm relationship – we hold your handthroughout the whole process.

Expect the following:• We first discuss your overall situation,your numbers and your goals.

• We show you how our Research processworks and then cross reference with someanalysis on what an investment propertywould cost, to see what is right for you.

• Introduce EPG approved properties andidentify which ones might be suitable;

• Help you select the best property for yourcircumstances;

• Make sure your investment is set upproperly. This is really important; and

• Provide regular reports and analysis ofyour investment's performance.

Our PropertyPlanning Process

We provide acomprehensive cash-flow analysis which

helps forecastproperty scenarios

over the next 30years.

The Esho team believes asset management should go beyond just collecting rent and payingoutgoings, it needs to also focus on the positioning of assets in the current market place. Ourdedicated property management advisors conduct quarterly reviews, making sure you getthe highest quality information about your property and where it stands in the market. We'reknown for producing high quality appraisals. We define our real estate asset managementoffering as including all of the following:

* Rental Management* Financial Management & Accounting* Client-Only Market Insights & Research* Annual Strategy Reviews

While we advocate long-term investing principals in all of our advice, sometimes things can.Each person has their own unique set of circumstances. If for some reason you decide to sellyour property in the future, the Esho team provides a "Managed Sales" service exclusively forour clients.

Your personal Esho property advisor will oversee the entire sales process for you, fromadvice on choosing the most appropriate selling agent, to all aspects legal. Everything thatwill ensure you have the advantage of the sale concluding efficiently, successfully and, if yourequire, confidentially.

Ongoing Relationship; Post PurchaseSupport

Property values can fluctuate throughout theeconomic cycle. Understanding the impact ofmarket movements on valuations is essential.

The Esho teams spends time and care in its ongoingresearch and analysis support, ensuring clients areaware of recent movements and equity creationopportunities in their investment portfolio.

In particular, demographic changes andgovernment infrastructure projects can have aprofound impact on market valuations andopportunities.

MANAGED SALES

INVESTMENT PROPERTY MANAGEMENT

Our research process has been developedinternally, with the help of seniorinvestment experts. The Esho team hasspent more than a decade advisingindividual and corporate investmentclients globally.

Our unique methodology is built on threecomponents – macro economic trends,micro economic components and a qualityscore which means that four out of fiveproperties evaluated by our Advisory Boardare rejected.

We only present the very highest quality toour clients.

Our Unique ResearchMethodology

STEP ONE - KNOWING THE SEASONS

One of the most important parts of ourresearch process is understandingmarketing timing.

While we always advocate a long termhorizon when it comes to propertyinvesting, the current state of the marketcan make a large impact to compoundannual average returns.

There is no such thing as the perfect timeand we by no means profess to have acrystal ball – but timing and knowing theinfluencing factors of market cycles playsan over-arching starting point to ouroverall process.

Know Seasons

Way of Thinking

Macro Economic

Micro Economic

Quality Score

Our Unique ResearchMethodology

STEP TWO - MACRO-ECONOMIC OUTLOOK

Our research process begins with a view onthe global economic environment. Whathappens around the world impacts everysingle investment asset. Real estate is noexception. The outlook on global interestrates and central bank policy can oftenhave very profound implications on howbanks lend and investors behave.

Availability of credit and the cost of creditare two of the most important factorsconsiderations in this process. Theabundance of credit creates inflationarypressure, of which investors need to plan.

The macro-economic environment issomething that is very closely monitoredand discussed by our Advisory Board – alldistinguished, qualified professionals.

We also have access to some of the highestquality research from global investmentbanks, research houses and governmentorganisations. We provide regular insightsinto our macro-economic way of thinkingthrough our Market Insights section, whichhas limited articles posted to the generalpublic (many others are client only).

Know Seasons

Way of Thinking

Macro Economic

Micro Economic

Quality Score

Our Unique ResearchMethodology

STEP THREE - MICRO-ECONOMIC OUTLOOK

Once we have a clear picture on the globaloutlook, we then specify certain regionsand geographies within our target areawhich have the greatest prospect ofappreciation.

We look at factors such as:• Infrastructure and demographic changes

• Government expenditure and corporateconfidence

• Council zoning and regulations

• Education and medical infrastructure

• Demographics including income growth,socio-economic factors, population growthand lifestyle changes

• Transportation and quality of life,including entertainment precincts

• Perhaps the most important, supply anddemand of future dwellings. We usegovernment statistics to calculate thecurrent and future anticipated changes.

• This has an impact on yields andaffordability, with a cross check to our owninternally generated benchmarks

Know Seasons

Way of Thinking

Macro Economic

Micro Economic

Quality Score

Our Unique ResearchMethodology

STEP FOUR - QUALITY SCORE

With the macro and micro economic factorshaving been established and analysed, thenext step of our research process is to assessthe quality scoring of each individualtangible asset which we see. As a generalrule, we reject almost four out of every fiveproperties which we asses, many failing topass our stringent scoring system at thislevel.

We look at factors such as:• Developer and builder track record,financial backing, reputation and disclosure

• Delivery expectations, the legal processand commercial expectations

• Design and aesthetics of the particularproperty and surrounding areas.

• Property features and common amenities;their appropriateness given the targetdemographic and selection of assetmanagers to ensure these are not futurefinancial constraints• Prevention of any unnecessary hazards

• Financial terms, conditions and re salefactors into the broader market to ensurepurchaser has options.

• And most importantly for investors –expected cashflow, outgoings and likelytenancy appeal.

Know Seasons

Way of Thinking

Macro Economic

Micro Economic

Quality Score

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