Nicola U.S. Real Estate Limited Partnership Quarterly Report - Q1 2019

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The Nicola U.S. Real Estate LP's (NUSRELP) objective is to

provide clients of Nicola Wealth access to long term investments in

real estate throughout the USA. Returns are generated from rental

income, capital appreciation and stable distributions primarily from

net operating income.

NUSRELP invests in stabilized income producing properties with

a long term investment horizon. The portfolio is diversified by

asset type (retail, office, industrial and multi-family) and

geographic locations across the USA. This includes a limited

amount of "build to own" developed properties.

OBJECTIVE STRATEGY

Gross Asset Value by Type as of March 31, 2019 Stated in US dollars

Key Statistics

Inception Date July, 2007

Net Asset Value $713.0 Million

NAV Per Unit (Class O) $154.22

Number of Assets 75

Total Asset Value $1.51 Billion

Debt Leverage Ratio 48%

Trailing 12 Month Distribution 5.7%

Total Square Feet 7,984,453

Portfolio Occupancy 94%

Average Cap Rate 5.8%

Average Cost of Debt 3.9%

Calendar Year Returns

2018 11.4%

2017 9.7%

2016 13.7%

2015 12.8%

2014 11.2%

Returns for the periodending March 31, 2019

Year-to-Date 3.1%

1 Year 13.5%

3 Year 11.4%

5 Year 12.3%

Since Inception 11.1%

n Multi-Family: 60.0%

n Office: 26.0%

n Other: 6.0%

n Retail: 5.0%

n Industrial: 3.0%

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Nicola U.S. Real Estate Limited Partnership Quarterly Report - Q1 2019

Gross Asset Value by Location Portfolio Occupancy bySquare Foot

Investment Activity

n Texas: 39.0%

n Washington: 17.0%

n Georgia: 15.0%

n Florida: 12.0%

n Other: 7.0%

n California: 3.0%

n Illinois: 3.0%

n Arizona: 2.0%

n Colorado: 1.0%

n North Carolina: 1.0%

ValueCurrentQuarter

Acquisitions 2 $65.1m

Dispositions 1 $2.5m

200 -400 Pinnacle Peak Road – Phoenix, AZ (Partner: HopewellDevelopment)

Project Description: This property was acquired in March and comprises 31 acres of industrial zoned land in the

popular Deer Valley submarket at the north end of the Loop 101 Freeway. This development is part of our "Build-

to-Own" strategy, and will comprise four distribution buildings averaging 98,000 sf each, and will be completed in

two phases.

The Preserve Phases 1 & 2 – Houston, TX (Partner: Venterra Living)

Project Description: This multi-family property was acquired in January and comprises two phases with a total of

528 units. Phase 1 was completed in 2009 with 192 units. Phase 2 was completed in 2017 with 336 units. This

garden style apartment complex is situated in the desirable East Houston suburb of Pasadena, and offers

significant upside potential including renovation of existing units, and enhanced amenity package. It will also

benefit from Venterra’s management platform that has a strong focus on customer service and rent maximization

software.

Forest View & Timber Mill, Woodlands – Houston, TX (Partner: VenterraLiving)

Project Description: We increased our holding of this multi-family portfolio in March 2019, increasing from a

minority 3% stake to a 63% majority holding, after buying out Venterra’s capital partner. Forest View was

constructed in 1993 and comprises 256 units. Timber Mill was completed in 1995 and features 216 units. Both

are situated in the North Houston Community known as Woodlands. The strategy is to continue with the value

add program consisting of suite renovations and benefit from Venterra’s management platform

Norfolk Industrial Building – Seattle,WA

Project Description: This industrial property was originally acquired in 2013 and comprises 120,951 sf. The

anchor tenant comprising 79,940 sf, represents 66% of the building and was recently renewed for another seven

years with annual rental increases. The renewal de-risks the asset and provides stable cash flow for the long

term. The existing debt was scheduled to mature and the lease renewal will significantly enhance the re-

financing options.

For more information on this fund’s monthly performance, click here.

Past performance is not indicative of future results. All investments contain risk and may gain or lose value. The YTD and 1 year return is a historical simple return. The 3, 5,10 year and since inception returns are annualized compounded total returns. All returns are net of fund-level fees and expenses, including management fees andperformance fees (if applicable). Please read the Limited Partnership Agreement and disclosure documents for important disclosure information including terms ofredemption and limited liquidity. Nicola Wealth is registered as a Portfolio Manager, Exempt Market Dealer and Investment Fund Manager with the required provincialsecurities’ commissions. This investment is only available for sale to residents of Canada who are accredited investors. Please speak with a Nicola Wealth advisor todiscuss if this investment is right for you. Nicola US Real Estate LP was set up in July 2007 but opened to investors in June 2010. All returns are calculated from June 2010.Returns are calculated on a monthly basis and may differ from client returns which are updated with a 1 month lag. Effective Jan. 1, 2019 the Nicola U.S. Real Estate LPadopted a new mandate and changed its name from SPIRE US LP.

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