PRO FORMA ALTA OWNER'S POLICIES OF TITLE INSURANCE
ALL PROPERTIES (14)
FAIRWATER REAL ESTATE INVESTMENT TRUST
$1,100,000,000 Sun Belt Logistics & Office Portfolio Acquisition
Prepared by:
CALDERWOOD & HARKNESS LLP
450 Park Avenue, 28th Floor New York, New York 10022
and
1700 K Street NW, Suite 900 Washington, DC 20006
Matter Number: 1036-00004
Date of Compilation: June 6, 2024 (Closing Date)
Reviewed and Approved by:
Douglas Fairchild, Responsible Partner Grace Nakamura, Lead Associate
Calderwood & Harkness LLP
Transaction Summary
This compilation relates to that certain Purchase and Sale Agreement dated February 28, 2024 (the "PSA"), by and between Greystone Meridian Partners Fund III, L.P., a Delaware limited partnership ("Seller"), and Fairwater Real Estate Investment Trust, a Maryland real estate investment trust ("Buyer" or "Fairwater REIT"), as amended by the First Amendment to Purchase and Sale Agreement dated April 12, 2024, and the Second Amendment to Purchase and Sale Agreement dated May 28, 2024 (collectively, the "Purchase Agreement"). The transaction involves the entity-level acquisition of one hundred percent (100%) of the membership interests in fourteen (14) property-owning single-purpose Delaware limited liability companies (each, a "Target Entity" and collectively, the "Target Entities"). The actual closing date is June 6, 2024.
CONFIDENTIAL — ATTORNEY WORK PRODUCT — ATTORNEY-CLIENT PRIVILEGED This document has been prepared by Calderwood & Harkness LLP solely for the use of Fairwater Real Estate Investment Trust and its authorized representatives in connection with the transaction described herein. This document contains attorney work product and information protected by the attorney-client privilege. Any distribution, reproduction, or use of this document without the express written consent of Calderwood & Harkness LLP is strictly prohibited.
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SECTION 1: INTRODUCTION AND SUMMARY OF PRO FORMA POLICIES
1.1 Purpose
This compilation (the "Pro Forma Policy Compilation" or this "Compilation") presents pro forma ALTA Owner's Policies of Title Insurance (2021 form) for each of the fourteen (14) real properties comprising the Sun Belt Logistics & Office Portfolio (the "Portfolio"), as more particularly described herein and in the Purchase Agreement. Each pro forma policy has been prepared in the form to be issued by Commonwealth National Title Insurance Company ("Commonwealth Title" or the "Title Insurer"), acting through its Senior Vice President, Kenneth Stanhope, and National Counsel, Virginia Moorehead, AVP, from Commonwealth Title's national headquarters located at 191 Peachtree Street NE, Suite 800, Atlanta, Georgia 30303.
Each policy insures Fairwater Real Estate Investment Trust, a Maryland real estate investment trust, as the named insured, reflecting Buyer's status as the indirect owner of fee simple title through its acquisition of one hundred percent (100%) of the membership interests in each Target Entity. Each Target Entity is a single-purpose Delaware limited liability company that holds fee simple title to one of the fourteen (14) properties comprising the Portfolio. The policies reflect Fairwater REIT's indirect ownership of the underlying real property through its membership interest ownership structure, with the Non-Imputation Endorsement providing critical protection against the imputation of knowledge or acts of any prior members or managers of the Target Entities.
The pro forma policies reflect, in their final negotiated form: (a) all negotiated Permitted Exceptions, as set forth in PSA Exhibit P and agreed upon by the parties during the title objection and cure process; (b) all satisfied Schedule B — Part I requirements, as confirmed by Commonwealth Title; and (c) all requested endorsements, as identified in the Calderwood & Harkness LLP Endorsement Request Letter to Commonwealth Title dated March 20, 2024, and as confirmed available and issuable by Commonwealth Title through its title officer and national counsel.
This Compilation is intended to serve as the definitive record of the pro forma title insurance coverage applicable to the Portfolio as of the closing date, and to provide Buyer and its advisors with a comprehensive reference for the title insurance protections secured in connection with the transaction. The final ALTA Owner's Policies will be issued by Commonwealth Title following closing and upon completion of all post-closing recording and confirmation procedures, as documented in the C&H Title Policy Issuance Confirmation Memo dated July 15, 2024.
1.2 Aggregate Insured Amount
The total aggregate insured amount under the fourteen (14) pro forma ALTA Owner's Policies is One Billion One Hundred Million Dollars ($1,100,000,000). This aggregate amount represents the original purchase price for the Portfolio as set forth in the Purchase Agreement, prior to the negotiated purchase price adjustment of $1,070,000 (the "PCA Credit") reflecting fifty percent (50%) of the aggregate estimated immediate repair costs of $2,140,000 identified by Rampart Building Sciences, LLC in its Property Condition Assessment reports.
The individual property insured amounts have been allocated in accordance with the Purchase Price Allocation Schedule attached to the Purchase Agreement as Exhibit K (the "Allocation Schedule"). The Allocation Schedule was prepared based upon the independent appraisals of each property conducted by Stonebridge Valuation Advisors, LLC, with appraisals certified by Maureen Alcott, MAI, CCIM, as of January 15, 2024, and updated as of May 1, 2024. The individual allocated insured amounts are set forth in the Insured Amount Allocation Schedule in Section 2 of this Compilation.
It is noted that the policy insured amounts are based upon the original purchase price allocation of $1,100,000,000, rather than the adjusted purchase price of $1,098,930,000, reflecting the parties' agreement that the PCA Credit constitutes a general adjustment to the aggregate consideration and is not allocated to specific properties for purposes of title insurance coverage.
1.3 Policy Form
Each pro forma policy is issued on the ALTA Owner's Policy of Title Insurance, 2021 form, as adopted by the American Land Title Association and approved for use in each applicable jurisdiction. The 2021 form incorporates current ALTA standard terms, conditions, and stipulations, including updated exclusions from coverage, definitions, and claims procedures.
The effective date of each policy is June 6, 2024, the closing date of the transaction. Each policy provides coverage as of the date and time of closing and, in the case of this entity-level transfer where no deed is recorded, as of the time of the transfer of membership interests in each Target Entity.
All surveys referenced in the pro forma policies conform to the ALTA/NSPS Land Title Survey, 2021 Minimum Standard Detail Requirements, including the optional Table A items specified in Section 8 of this Compilation. All surveys were prepared and certified by Meridian Land Surveying, Inc., under the supervision of Daniel Caulfield, PLS, PE, and have been certified to Fairwater REIT, Commonwealth Title, each applicable lender, and Calderwood & Harkness LLP.
1.4 Premium Summary
The total estimated title insurance premiums for the transaction, encompassing both owner's and loan policies across all fourteen (14) properties, are Two Million Four Hundred Twenty Thousand Dollars ($2,420,000). All title insurance premiums are borne by Buyer pursuant to Section 10.4(b) of the Purchase Agreement. Premium amounts have been calculated in accordance with the applicable rate schedules and regulatory requirements in each jurisdiction, including promulgated rates in Texas, Florida, and North Carolina.
The allocation of premiums across the fourteen (14) properties is set forth in the Title Insurance Premium Allocation Schedule, a separate C&H work product maintained in the closing files for this matter.
1.5 Key Endorsements Requested Across All Policies
The following endorsements have been requested and confirmed available for issuance by Commonwealth Title across all fourteen (14) pro forma policies, subject to state-specific endorsement form numbering and availability as coordinated with local counsel in each jurisdiction:
(a) Owner's Comprehensive Endorsement — Providing affirmative coverage against loss or damage arising from the existence of violations of covenants, conditions, and restrictions affecting the property, encroachments, and certain other matters.
(b) Access Endorsement (ALTA 17.0) — Insuring that the insured property has actual vehicular and pedestrian access to and from a physically open public street, road, or highway.
(c) Survey Endorsement (ALTA 25.0 — Same as Survey) — Insuring that the land described in Schedule A is the same as that shown on the ALTA/NSPS Land Title Survey identified in the endorsement.
(d) Zoning Endorsement (ALTA 3.0 — with Parking) — Insuring that the current zoning classification of the property permits the existing use and, where applicable, that the property complies with applicable parking requirements under the zoning ordinance.
(e) Contiguity Endorsement (ALTA 19.0) — Where applicable to properties consisting of multiple parcels, insuring that the parcels are contiguous and that no gaps or gores exist between them.
(f) Tax Parcel Endorsement — Insuring that the insured property constitutes one or more separate tax parcels, with no other real property included in such tax parcels.
(g) Non-Imputation Endorsement — Insuring that knowledge of, consent to, or participation in any act or omission by any prior member, manager, officer, or agent of the Target Entity (including, without limitation, Greystone Meridian Partners Fund III, L.P., Greystone Meridian Capital LLC, and the individuals Victor Lansdell, Elise Rathborne, and Sean Kilpatrick) shall not be imputed to the insured or constitute a defense to coverage under the policy.
(h) Easement — Damage or Enforced Removal Endorsement (ALTA 28.0) — Insuring against loss or damage arising from the exercise of the right of use or maintenance of any easement affecting the property if such exercise results in damage to existing improvements or enforced removal of improvements.
(i) Minerals and Other Subsurface Substances Endorsement (ALTA 35.0) — Insuring against loss or damage arising from the exercise of mineral rights in, on, or under the insured property.
(j) Restrictions, Encroachments, Minerals Endorsement (ALTA 9.0 series) — Providing comprehensive coverage against violations of restrictions, encroachments, and mineral matters.
(k) Fairway / Mezzanine Endorsement — Where applicable, providing coverage in connection with mezzanine financing or pledge of membership interests.
(l) Additional Endorsements — Such additional endorsements as specified on a property-by-property basis in Section 4 of this Compilation and in the C&H Endorsement Request Letter to Commonwealth Title dated March 20, 2024.
State-specific endorsement form numbers and availability are addressed in Section 9 of this Compilation (Coordination with Local Counsel) and in the Endorsement Forms Index attached as Appendix B.
SECTION 2: INSURED AMOUNT ALLOCATION SCHEDULE
The following table sets forth the allocation of the aggregate insured amount of $1,100,000,000 across the fourteen (14) properties comprising the Portfolio, as determined by the Purchase Price Allocation Schedule (PSA Exhibit K). Allocated amounts are based upon the independent appraisals prepared by Stonebridge Valuation Advisors, LLC (Maureen Alcott, MAI).
Note: The allocated insured amounts set forth above total $1,100,000,000, which represents the original purchase price allocation and not the adjusted purchase price of $1,098,930,000 (reflecting the negotiated PCA Credit of $1,070,000). The policy insured amounts are based upon the original purchase price allocation, as agreed between the parties and Commonwealth Title. Individual policy amounts may be subject to minor adjustment upon final reconciliation and issuance of final policies by Commonwealth Title post-closing.
SECTION 3: GENERAL TERMS APPLICABLE TO ALL PRO FORMA POLICIES
3.1 Named Insured
Each pro forma policy names the respective Target Entity LLC as the insured party, in its capacity as the fee simple title holder of record for the applicable property. In addition, each policy names Fairwater Real Estate Investment Trust, a Maryland real estate investment trust, as an additional insured, reflecting Fairwater REIT's status as the sole member of each Target Entity LLC following the closing of the transaction on June 6, 2024.
The inclusion of Fairwater REIT as an additional insured is critical to ensuring that the title insurance coverage extends to the ultimate beneficial owner of the real property interests, notwithstanding the entity-level structure of the transaction in which title to the underlying real property remains vested in the Target Entity LLCs and no deeds are recorded.
Each policy includes a Non-Imputation Endorsement to protect Fairwater REIT from any claim, defense, or reduction of coverage based upon the imputation to the insured of knowledge of, consent to, or participation in any act, omission, or matter by any prior member, manager, officer, director, agent, or principal of the Target Entity LLC. This endorsement specifically protects against the imputation of knowledge or acts of Greystone Meridian Partners Fund III, L.P. (as the prior sole member of each Target Entity), Greystone Meridian Capital LLC (as the general partner of GMP Fund III and as the prior manager of each Target Entity), and the individual principals Victor Lansdell, Elise Rathborne, and Sean Kilpatrick, each of whom served in management or control capacities with respect to the Target Entities prior to closing.
3.2 Estate or Interest Insured
Each pro forma policy insures a fee simple estate in the respective property, as vested in the applicable Target Entity LLC. The fee simple estate is subject only to the Permitted Exceptions set forth in Schedule B — Part II of each respective policy, as negotiated by the parties and approved by Calderwood & Harkness LLP on behalf of Buyer.
The estate insured is the entire fee simple interest in the real property described in Schedule A of each policy, including all appurtenances, easements benefiting the insured property, and rights incident to the ownership of the fee simple estate, to the extent vested in the Target Entity LLC as of the effective date of the policy.
3.3 Effective Date
The effective date of each pro forma policy is June 6, 2024, at the time of closing and the transfer of one hundred percent (100%) of the membership interests in each Target Entity LLC from Seller to Buyer. Because the transaction is structured as an entity-level transfer of membership interests rather than a conveyance of real property by deed, no deed is recorded in connection with the closing. The effective time of each policy corresponds to the time of the execution and delivery of the Membership Interest Assignment Agreements and the completion of all closing deliverables.
Commonwealth Title has provided a gap indemnity / bring-down letter (the "Gap Letter") confirming continuous title insurance coverage from the effective date of each title commitment through the June 6, 2024 closing date. The Gap Letter confirms that Commonwealth Title has conducted a search of the applicable public records from the effective date of each title commitment through the date immediately preceding closing and has identified no intervening liens, judgments, encumbrances, or other adverse matters that would affect the insured title or require modification of the pro forma policies.
The Gap Letter further confirms that Commonwealth Title will provide coverage for any matters first appearing of record during the gap period (i.e., between the effective date of each title commitment and the closing date) that are not Permitted Exceptions, subject to the standard terms and conditions of the ALTA Owner's Policy (2021 form).
3.4 Schedule A — Standard Provisions
Each pro forma policy Schedule A includes the following standard provisions, completed with property-specific information as set forth in Section 4 of this Compilation:
(a) Policy Number: Assigned by Commonwealth Title upon issuance of the final policy. Pro forma policy numbers are referenced as "Pro Forma — [Property Number]" in this Compilation.
(b) Date of Policy: June 6, 2024.
(c) Amount of Insurance: As set forth in the Insured Amount Allocation Schedule in Section 2 of this Compilation, allocated per PSA Exhibit K.
(d) Name of Insured: The respective Target Entity LLC, together with Fairwater Real Estate Investment Trust as additional insured.
(e) Estate or Interest: Fee simple.
(f) Title Vested In: The name of the respective Target Entity LLC (e.g., "GMP Fairfield I LLC, a Delaware limited liability company").
(g) Legal Description: As set forth in PSA Exhibit A for the applicable property, consisting of metes-and-bounds descriptions and/or plat references, as confirmed by the ALTA/NSPS surveys prepared by Meridian Land Surveying, Inc.
The legal description in each policy Schedule A has been compared against the metes-and-bounds description set forth in the applicable title commitment, the recorded deed or other instrument of record vesting title in the Target Entity LLC, and the ALTA/NSPS survey for the property. Any discrepancies identified during this review process have been resolved and corrected in the pro forma policies, as documented in the C&H Survey Review Comment Letter dated March 15, 2024.
3.5 Schedule B — Part I: Requirements (Satisfied)
Calderwood & Harkness LLP confirms, on behalf of Buyer, that all Schedule B — Part I requirements set forth in each title commitment issued by Commonwealth Title have been satisfied as of the closing date. The satisfied requirements include, without limitation, the following:
(a) Payment of Title Insurance Premium. All title insurance premiums for owner's and loan policies have been paid by Buyer at closing through the applicable closing settlement statements, totaling an estimated $2,420,000 in the aggregate.
(b) Execution and Delivery of Closing Documents. All closing documents required by the title commitments have been duly executed and delivered, including, without limitation, the Membership Interest Assignment Agreements, Amended and Restated Operating Agreements for each Target Entity LLC, Replacement Guaranties, lender consent documents, and related instruments.
(c) Evidence of Authority. Satisfactory evidence of the authority of each party to execute and deliver the closing documents has been provided to Commonwealth Title, including Secretary's Certificates from both Seller and Buyer, certificates of good standing for each Target Entity LLC, certificates of formation, resolutions authorizing the transaction, and incumbency certificates.
(d) Recording of Applicable Documents. To the extent any documents require recording in connection with the closing (including, without limitation, any amendments to existing mortgages, assignments, or lender consent documents requiring recordation), such documents have been submitted for recording through local counsel in each applicable jurisdiction.
(e) Delivery of Title Affidavits. Title affidavits in the form attached to the Purchase Agreement as Exhibit T have been executed by an authorized officer of Greystone Meridian Capital LLC, as general partner of Greystone Meridian Partners Fund III, L.P., on behalf of each Target Entity LLC. The title affidavits address, among other matters, the absence of unrecorded liens, claims, or encumbrances, the absence of parties in possession other than tenants under existing leases, the absence of boundary disputes, the absence of unrecorded easements, and the completion of all construction work at each property.
(f) Payment of Real Property Taxes, Assessments, and Utility Charges. All outstanding real property taxes, assessments, special assessments, and utility charges due and payable as of the closing date have been paid in full, with prorations made at closing in accordance with Section 10.3 of the Purchase Agreement.
(g) Release of Monetary Liens and Other Mandatory Cure Items. All monetary liens, mechanic's liens, delinquent taxes, and judgments against the Target Entities constituting mandatory cure items under the Purchase Agreement have been released or otherwise resolved prior to closing. Evidence of such releases, including recorded satisfactions, payoff letters, and lien waivers, has been delivered to Commonwealth Title.
(h) UCC and Judgment/Lien Searches. Uniform Commercial Code searches, judgment searches, and lien searches have been conducted in each applicable jurisdiction and confirm no adverse matters affecting the Target Entities or the properties, other than the assumed mortgage liens and financing statements related thereto. UCC-3 termination statements have been obtained for any UCC financing statements that are not related to the assumed mortgage facilities.
3.6 Schedule B — Part II: Exceptions from Coverage
Each pro forma policy Schedule B — Part II reflects only the negotiated Permitted Exceptions as set forth in PSA Exhibit P and agreed upon by the parties during the title objection and cure process described in Section 7 of this Compilation. The standard printed exceptions that are typically included in ALTA Owner's Policies have been deleted or modified as applicable, reflecting extended coverage (survey-based) policies for all fourteen (14) properties.
The following general exception categories are applicable across all fourteen (14) pro forma policies, in addition to the property-specific exceptions identified in Section 4 of this Compilation:
(a) Real Property Taxes. Real property taxes and assessments for the calendar year 2024, not yet due and payable, which are a lien but not yet delinquent, and which have been prorated at closing between Seller and Buyer. The total estimated annual real property taxes across the Portfolio are approximately $14,760,000, of which Seller's prorated share for the period from January 1, 2024 through June 5, 2024 (157 days) is approximately $6,332,951.
(b) Rights of Tenants. Rights of tenants and occupants under existing leases, as tenants only, without any right of purchase, option to purchase, or right of first refusal, except as specifically disclosed in the rent rolls and tenant estoppel certificates delivered at closing. The Portfolio includes a total of eighty-seven (87) executed leases across the fourteen (14) properties, all of which have been reviewed by Calderwood & Harkness LLP and are reflected in the Tenant Abstract Memorandum (separate C&H work product).
(c) Survey Matters. Matters disclosed by the ALTA/NSPS Land Title Surveys prepared by Meridian Land Surveying, Inc. and certified by Daniel Caulfield, PLS, PE, including easements, encroachments, building setback lines, and other survey-related matters. All survey matters have been reviewed in the C&H Survey Review Comment Letter dated March 15, 2024, and those determined to be material have been addressed through endorsements, affirmative coverage, or acceptance as Permitted Exceptions.
(d) Easements, Restrictions, and Covenants of Record. Property-specific easements, restrictions, covenants, conditions, and agreements of record, as identified in each title commitment and confirmed as Permitted Exceptions through the title objection and cure process. The specific instruments constituting these exceptions are identified in the property-by-property detail in Section 4 of this Compilation.
(e) Zoning and Governmental Regulations. Zoning ordinances, governmental regulations, and building codes affecting each property. While these matters are generally excluded from title insurance coverage, the zoning endorsements obtained for each property (ALTA 3.0 — with parking) provide affirmative insurance that the current use of each property is permitted under the applicable zoning classification and that the property complies with parking requirements. Zoning confirmation letters have been obtained from local zoning authorities for all fourteen (14) properties.
(f) Assumed Mortgage Liens. The mortgage liens, deeds of trust, deeds to secure debt, assignments of leases and rents, and related security instruments securing the assumed mortgage indebtedness under the three loan facilities described in Section 5 of this Compilation:
(i) Pinnacle Federal Bank, N.A. — securing Loans 1-A through 1-H (eight properties; aggregate OPB $421,600,000);
(ii) Veltrano Capital Lending Corp. — securing Loans 2-A through 2-D (four properties; aggregate OPB $142,300,000); and
(iii) Sycamore Life Insurance Company — securing Loans 3-A and 3-B (two properties; aggregate OPB $48,100,000).
The total aggregate outstanding principal balance of assumed indebtedness is $612,000,000.
3.7 Endorsements — Standard Package
The following endorsements comprise the standard endorsement package applicable to all fourteen (14) pro forma policies. Specific endorsement form numbers vary by state as noted, and state-specific endorsement availability has been confirmed by local counsel in each jurisdiction (see Section 9). The endorsements set forth below are in addition to any property-specific endorsements identified in Section 4 of this Compilation.
(a) ALTA 9.0 Series — Restrictions, Encroachments, Minerals. This endorsement provides affirmative coverage against loss or damage arising from (i) existing violations of any covenants, conditions, or restrictions affecting the property, (ii) encroachments of improvements on the property onto adjoining property or easements, or encroachments onto the property from adjoining property, and (iii) the exercise of mineral rights, including the right to extract minerals.
(b) ALTA 17.0 — Access and Entry. This endorsement insures that the insured property has actual vehicular and pedestrian access to and from a physically open, publicly maintained street, road, or highway identified in the endorsement.
(c) ALTA 25.0 — Same as Survey. This endorsement insures that the land described in Schedule A of the policy is the same as that identified and depicted on the ALTA/NSPS Land Title Survey for the property, as prepared and certified by Meridian Land Surveying, Inc.
(d) ALTA 19.0 — Contiguity. Where applicable (i.e., for properties consisting of multiple parcels), this endorsement insures that the separately described parcels comprising the insured property are contiguous to one another along lines of common boundary and that no gaps or gores exist between them.
(e) ALTA 3.0 — Zoning (with Parking). This endorsement insures that the current zoning classification of the insured property permits the use of the property as presently improved and operated (logistics/distribution or office, as applicable) and that the property complies with applicable off-street parking requirements under the zoning ordinance.
(f) ALTA 28.0 — Easement — Damage or Enforced Removal. This endorsement insures against loss or damage arising from the exercise of the right of use or maintenance of any easement affecting the property, to the extent such exercise results in damage to or enforced removal of existing improvements on the property.
(g) ALTA 35.0 — Minerals and Other Subsurface Substances. This endorsement insures against loss or damage arising from the exercise of any right to use the surface of the insured property for the extraction or development of minerals, water, or other subsurface substances.
(h) Non-Imputation Endorsement. This endorsement provides that no knowledge of, consent to, or participation in any act, omission, transaction, or matter by any prior member, manager, officer, director, agent, or principal of the Target Entity LLC shall be imputed to the insured or constitute a defense to coverage under the policy.
(i) Tax Parcel Endorsement. This endorsement insures that the insured property constitutes one or more separate and distinct tax parcels identified by specific tax parcel identification numbers, and that no other real property is included within such tax parcels.
(j) Additional Endorsements. Such additional endorsements as have been requested in the C&H Endorsement Request Letter to Commonwealth Title dated March 20, 2024, and confirmed available by Commonwealth Title, including state-specific equivalents of the foregoing endorsements (e.g., Texas T-19 series endorsements, Florida Form 9 endorsements) and property-specific endorsements identified in Section 4 of this Compilation.
SECTION 4: INDIVIDUAL PRO FORMA POLICIES — PROPERTY-BY-PROPERTY DETAIL
This Section 4 sets forth the property-by-property detail for each of the fourteen (14) pro forma ALTA Owner's Policies, including the key terms, exceptions, endorsements, and other relevant information specific to each property. The information presented herein supplements the general terms applicable to all pro forma policies as set forth in Section 3 and should be read in conjunction therewith.
4.1 Policy No. 1 — Fairfield Logistics Center I
Property Address: 4200 Fairfield Industrial Blvd, Fairburn, Georgia 30213
Target Entity / Title Holder: GMP Fairfield I LLC (EIN: 84-2310561), a Delaware limited liability company, qualified to do business in the State of Georgia.
Property Type: Logistics / Distribution — 412,000 rentable square feet ("RSF"); Year Built 2020; concrete tilt-up construction; 36-foot clear height; 80 dock-high doors; 4 drive-in doors; 260 trailer parking spaces.
Insured Amount: $98,500,000 (per PSA Exhibit K Allocation Schedule).
Assumed Loan: Loan 1-A under the Pinnacle Federal Bank, N.A. Master Loan Agreement dated September 15, 2020, as amended by that certain First Amendment to Master Loan Agreement dated March 1, 2022. Allocated outstanding principal balance as of the closing date: approximately $53,200,000.
State: Georgia.
Schedule A:
• Date of Policy: June 6, 2024
• Amount of Insurance: $98,500,000
• Name of Insured: GMP Fairfield I LLC, a Delaware limited liability company; Fairwater Real Estate Investment Trust, a Maryland real estate investment trust, as additional insured
• Estate or Interest: Fee simple
• Title Vested In: GMP Fairfield I LLC, a Delaware limited liability company
• Legal Description: As set forth in PSA Exhibit A, Property 1 (metes-and-bounds description referencing plats recorded in Plat Book 82, Pages 114-117, Fulton County, Georgia records)
Schedule B — Part II (Permitted Exceptions): The following property-specific Permitted Exceptions are set forth in Schedule B — Part II of the pro forma policy for this property, in addition to the general exception categories described in Section 3.6:
(a) Declaration of Covenants, Conditions, and Restrictions for Fairfield Commerce Park recorded in Deed Book 54892, Page 1230, Fulton County, Georgia records, as amended by that certain First Amendment recorded in Deed Book 56401, Page 892, Fulton County, Georgia records.
(b) Easement for ingress, egress, and utilities in favor of Drayton Holdings recorded in Deed Book 52103, Page 445, Fulton County, Georgia records.
(c) Easement for water and sewer lines in favor of Fulton County Water and Sewer Authority recorded in Deed Book 53290, Page 678, Fulton County, Georgia records.
(d) Stormwater management easement and maintenance agreement recorded in Deed Book 54893, Page 1, Fulton County, Georgia records.
(e) Matters shown on the ALTA/NSPS survey, including a 0.3-foot encroachment of a concrete retaining wall along the northwestern property boundary (determined to be de minimis and accepted as a Permitted Exception).
(f) Rights of tenants under existing leases, as tenants only, as set forth in the rent roll delivered at closing (four tenants; aggregate annual base rent of $4,944,000).
(g) Real property taxes for the year 2024, not yet due and payable.
(h) Deed to Secure Debt, Assignment of Leases and Rents, Security Agreement and Fixture Filing executed by GMP Fairfield I LLC in favor of Pinnacle Federal Bank, N.A. recorded in Deed Book 55720, Page 334, Fulton County, Georgia records (Loan 1-A — assumed mortgage lien).
Endorsements: Standard endorsement package as described in Section 3.7, plus the following Georgia-specific endorsements:
• Georgia Form Comprehensive Endorsement
• Georgia Access Endorsement
• Contiguity Endorsement (ALTA 19.0) — insuring contiguity with the adjacent Fairfield Logistics Center II parcel (Property No. 2), as the two parcels share a common boundary along the southeastern property line
• Georgia Mineral Endorsement
Phase I ESA Status: Clean — No Recognized Environmental Conditions ("RECs") identified. Phase I Environmental Site Assessment prepared by EcoShield Environmental Consulting, LLC (Dr. Allison Carver, P.G.) dated January 22, 2024. No environmental insurance exclusion concerns.
Zoning: Zoning confirmation letter obtained from the City of Fairburn Department of Community Development dated February 14, 2024, confirming that the property is zoned M-2 (Heavy Industrial) and that the current logistics/distribution use is a permitted use under the applicable zoning ordinance.
Survey: ALTA/NSPS Land Title Survey prepared by Meridian Land Surveying, Inc. (Daniel Caulfield, PLS, PE), last dated March 1, 2024. Survey depicts all easements, encroachments, and building setback lines. The 0.3-foot encroachment of the concrete retaining wall noted above was addressed in the C&H Survey Review Comment Letter and accepted as a Permitted Exception following confirmation that the encroachment is de minimis and does not materially affect the use, value, or operation of the property.
4.2 Policy No. 2 — Fairfield Logistics Center II
Property Address: 4300 Fairfield Industrial Blvd, Fairburn, Georgia 30213
Target Entity / Title Holder: GMP Fairfield II LLC (EIN: 84-2310578), a Delaware limited liability company, qualified to do business in the State of Georgia.
Property Type: Logistics / Distribution — 387,000 RSF; Year Built 2020; concrete tilt-up construction; 36-foot clear height; 74 dock-high doors; 4 drive-in doors; 240 trailer parking spaces.
Insured Amount: $92,000,000 (per PSA Exhibit K Allocation Schedule).
Assumed Loan: Loan 1-B under the Pinnacle Federal Bank, N.A. Master Loan Agreement dated September 15, 2020, as amended. Allocated outstanding principal balance as of the closing date: approximately $49,700,000.
State: Georgia.
Schedule A:
• Date of Policy: June 6, 2024
• Amount of Insurance: $92,000,000
• Name of Insured: GMP Fairfield II LLC, a Delaware limited liability company; Fairwater Real Estate Investment Trust, a Maryland real estate investment trust, as additional insured
• Estate or Interest: Fee simple
• Title Vested In: GMP Fairfield II LLC, a Delaware limited liability company
• Legal Description: As set forth in PSA Exhibit A, Property 2 (metes-and-bounds description referencing plats recorded in Plat Book 82, Pages 118-121, Fulton County, Georgia records)
Schedule B — Part II (Permitted Exceptions): The following property-specific Permitted Exceptions are set forth in Schedule B — Part II of the pro forma policy:
(a) Declaration of Covenants, Conditions, and Restrictions for Fairfield Commerce Park (same CC&Rs as Property No. 1, recorded in Deed Book 54892, Page 1230, Fulton County, Georgia records, as amended).
(b) Reciprocal Access and Utilities Easement Agreement between GMP Fairfield I LLC and GMP Fairfield II LLC recorded in Deed Book 55718, Page 1102, Fulton County, Georgia records, providing cross-access between the Fairfield I and Fairfield II properties.
(c) Easement for ingress, egress, and utilities in favor of Drayton Holdings recorded in Deed Book 52103, Page 510, Fulton County, Georgia records.
(d) Easement for water and sewer lines in favor of Fulton County Water and Sewer Authority recorded in Deed Book 53290, Page 712, Fulton County, Georgia records.
(e) Stormwater detention and drainage easement recorded in Deed Book 54893, Page 45, Fulton County, Georgia records.
(f) Matters shown on the ALTA/NSPS survey — no encroachments identified.
(g) Rights of tenants under existing leases, as tenants only (three tenants; aggregate annual base rent of $4,644,000).
(h) Real property taxes for the year 2024, not yet due and payable.
(i) Deed to Secure Debt, Assignment of Leases and Rents, Security Agreement and Fixture Filing executed by GMP Fairfield II LLC in favor of Pinnacle Federal Bank, N.A. recorded in Deed Book 55720, Page 420, Fulton County, Georgia records (Loan 1-B — assumed mortgage lien).
Endorsements: Standard endorsement package, plus Georgia-specific endorsements and Contiguity Endorsement (ALTA 19.0) insuring contiguity with the adjacent Fairfield Logistics Center I parcel (Property No. 1).
Phase I ESA Status: Clean — No RECs identified. Phase I ESA prepared by EcoShield Environmental Consulting, LLC (Dr. Allison Carver, P.G.) dated January 22, 2024.
Zoning: Zoning confirmation letter obtained from the City of Fairburn Department of Community Development dated February 14, 2024. Property zoned M-2 (Heavy Industrial); current logistics/distribution use confirmed as a permitted use.
Survey: ALTA/NSPS Land Title Survey prepared by Meridian Land Surveying, Inc. (Daniel Caulfield, PLS, PE), last dated March 1, 2024. No encroachments or adverse survey matters identified. Survey depicts the common boundary line shared with the Fairfield I property, confirming contiguity.
4.3 Policy No. 3 — Westlake Distribution Hub
Property Address: 11500 Westlake Parkway, Houston, Texas 77082
Target Entity / Title Holder: GMP Westlake LLC (EIN: 84-2415693), a Delaware limited liability company, qualified to do business in the State of Texas.
Property Type: Logistics / Distribution — 624,000 RSF; Year Built 2019; concrete tilt-up construction; 40-foot clear height; 120 dock-high doors; 6 drive-in doors; 380 trailer parking spaces. This is the largest single property in the Portfolio by rentable square footage.
Insured Amount: $137,500,000 (per PSA Exhibit K Allocation Schedule).
Assumed Loan: Loan 1-C under the Pinnacle Federal Bank, N.A. Master Loan Agreement dated September 15, 2020, as amended. Allocated outstanding principal balance as of the closing date: approximately $74,300,000.
State: Texas.
Schedule A:
• Date of Policy: June 6, 2024
• Amount of Insurance: $137,500,000
• Name of Insured: GMP Westlake LLC, a Delaware limited liability company; Fairwater Real Estate Investment Trust, a Maryland real estate investment trust, as additional insured
• Estate or Interest: Fee simple
• Title Vested In: GMP Westlake LLC, a Delaware limited liability company
• Legal Description: As set forth in PSA Exhibit A, Property 3 (metes-and-bounds description referencing plats recorded in Volume 2018, Page 4892, Harris County, Texas real property records)
Schedule B — Part II (Permitted Exceptions): The following property-specific Permitted Exceptions are set forth in Schedule B — Part II of the pro forma policy:
(a) Restrictions, conditions, and covenants set forth in the Declaration of Covenants, Conditions, and Restrictions for Westlake Business Park recorded as Document No. 2018-0452891, Harris County, Texas real property records, as supplemented.
(b) Pipeline easement in favor of Penrose & Co. recorded as Document No. 1996-0234102, Harris County, Texas real property records, affecting a 30-foot strip along the southern boundary of the property. This easement is typical of the Houston industrial corridor and does not affect existing improvements.
(c) Electric transmission line easement in favor of Fenmore Corporation Houston Electric, LLC recorded as Document No. 2005-0678341, Harris County, Texas real property records, affecting a 50-foot strip along the eastern boundary.
(d) Water line easement in favor of the City of Houston recorded as Document No. 2001-0891234, Harris County, Texas real property records.
(e) Stormwater detention easement and maintenance agreement recorded as Document No. 2019-0123456, Harris County, Texas real property records.
(f) Matters shown on the ALTA/NSPS survey, including the pipeline and utility easements described above. No encroachments of improvements onto easement areas identified.
(g) Rights of tenants under existing leases, as tenants only (six tenants; aggregate annual base rent of $12,480,000; largest tenant: Cascade Supply Chain Solutions Inc., occupying approximately 260,000 RSF with annual base rent of $8,736,000).
(h) Real property taxes for the year 2024, not yet due and payable.
(i) Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing executed by GMP Westlake LLC to Kenneth Stanhope, as trustee, for the benefit of Pinnacle Federal Bank, N.A. recorded as Document No. 2020-0789123, Harris County, Texas real property records (Loan 1-C — assumed mortgage lien).
Endorsements: Standard endorsement package, plus Texas-specific endorsements, including:
• Texas T-19 (Restrictions, Encroachments, Minerals) endorsement — Texas Department of Insurance promulgated form
• Texas T-19.1 (Survey/Area/Boundary) endorsement
• Texas T-23 (Access) endorsement
• Texas T-24 (Zoning) endorsement