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HomeMy WebLinkAbout2010 07 28 Other This Presentation From UBS Was Provided To The BoardMEMORANDUM TO: Board of Trustees FROM: Gayle Coutant, Assistant to the City Clerk SUBJECT: UBS Global Asset Management DATE: July 28, 2010 Please find attached presentation from UBS Global Asset Management. This company could not be present tonight. Date: July 28, 2010 The following document was provided to the Board of Trustees at the July 28, 2010 Special Meeting. UBS For limited distribution to institutional and professional investors only Presented by: Ron Lanier, Executive Director July 28, 2010 Risks ♦ Investors should be aware that return objectives are subject to a number of assumptions and factors, a change in any of which could adversely affect returns. Accordingly, investors should note the limitations of an objective. ♦ Investments in direct real estate and real estate funds involve a high degree of risk. For instance, recent events such as the deterioration of credit markets and increased volatility have resulted in a historically unprecedented lack of liquidity and decline in asset values. The value of investments and income from them may increase or decrease. Investors must have the financial ability and willingness to accept and bear the risks (including, among other things, the risk of loss of investment) that are characteristic of real estate investing and investing in commingled fund for an indefinite period of time. Among the risks to be considered are: — Risks of investing in real estate. Risks include adverse changes in market and economic conditions, zoning, and other governmental laws, regulations, and policies, occupancy levels and the ability to lease space, and environmental risks, and risk of uninsured loses. — Debt investment risk. Risk includes risks of borrower defaults, bankruptcies, fraud and special hazard losses that are not covered by standard hazard insurance — Restrictions on redemption and transferability of shares or units; illiquidity. Real estate is an illiquid investment and the account may not be able to generate sufficient cash to meet withdrawal requests from investors. There is no public market for interests in any of our funds and no such market is expected to develop in the future. — Reliance on controlling persons and third parties. The exercise of control over an entity can impose additional risks of liability for a number of liabilities and an account or fund can experience a significant loss. The risk of third parties includes a conflict between their objectives and those of the account or fund. — Use of leverage. Leverage will increase the exposure of the real estate assets to adverse economic factors, such as rising interest rates, economic downturns, or deteriorations in the condition of the properties or their respective markets and changes in interest rates — Legal & Taxation. Non -US investors should consult their own legal and tax advisers for potential US and /or local country legal or tax implications on any investment — Currency risk. The funds and accounts managed by UBS Realty Investors LLC are denominated in US Dollars. There is a potential for loss due to currency fluctuations for non -US investors. — Lack of diversification. Individually managed accounts and funds in their initial investment periods may have investments that are relatively large compared to the account's or fund's anticipated total value. Any limit to diversification increases risk because the unfavorable performance of even a single investment might have an adverse effect on the aggregate return. — Unspecified investments. There can be no assurance that the advisor will be able to continually locate and acquire assets meeting the fund or account's objective. Competition for assets may generally reduce the number of suitable prospective assets available. ♦ In considering an investment in a commingled real estate fund, prospective investors must rely on their own examination of the partnership agreement, private placement memorandum, and all terms of the offering, including merits and details of these and other risks involved. Date: May 10, 2010 T T�7 S Man al Asset LJ 1! �] Management AU, CA, CEMEA, HK, JP, SG, UK, US-1 Table of Contents SECTION 1 Organization and Investment Process SECTION 2 UBS Trumbull Property Fund (UBS -TPF) 2.A Appendix SECTION 3 UBS Trumbull Property Income Fund (UBS -TPI) 3.A Appendix SECTION 4 Exhibits SECTION 5 UBS Global Real Estate Strategies and Funds 2 22 E, EM fuss i �, i SECTION 1 Organization and Investment Process T T�7 S Man al Asset LJ 1! �] Management UBS Realty Investors LLC History 1978 Began managing real estate assets for pension funds 1984 Aetna Realty Investors, Inc. (ARI) incorporated 1991 Relinquished responsibility for Aetna's General Account assets, focused on pension fund client business 1996 ARI was sold by Aetna to management and private equity partnerships managed by TA Associates, Inc. and named Allegis Realty Investors LLC; AgriVest was acquired by Allegis 1999 Allegis and AgriVest were acquired by UBS Global Asset Management and named UBS Realty Investors LLC and UBS AgriVest LLC 2001 Existing US real estate advisory business of UBS Global Asset Management for non -US clients was integrated into UBS Realty Investors LLC 2002 Real estate organization as a global pillar within UBS Global Asset Management and UBS Realty Investors LLC as US component 2003 Effective October 1, UBS Realty Investors LLC completed the process of appointment as direct investment manager and fiduciary for Aetna separate accounts, replacing Aetna in that capacity - -- US real estate business re- branded UBS Global Asset Management, Global Real Estate — US 2005 Firm successfully transferred assets in insurance company separate accounts to a REIT -based limited partnership on February 29 Dated: April 5, 2010 4 S B Man al Asset LJ Management AU, CA, CEMEA, HK, SG, UK, and US -1 Cap 5 Global Real Estate - US senior investment professionals Matthew Lynch, Head of Global Real Estate —US, UBS Global Asset Management (') Client & Portfolio Services Ron Lanier Yrs Experience Name Industry Firm Title /Responsibility Portfolio Management Kevin Crean') 31 26 Port Mgr — TPF Stephen Olstein 31 7 Asst Port Mgr — TPF Pamela Thompson 19 8 Asst Port Mgr — TPF Gary Gowdy(') 33 28 Port Mgr — TPI Christopher Clayton 24 25 Asst Port Mgr — TPI Paul Canning') 30 19 Port Mgr — TPG Jeffrey MaguireM 27 13 Port Mgr —AVT Peter Gilbertie 23 13 Asst Port Mgr —AVT Research Yrs Experience Name Industry Firm Title /Responsibility Dispositions Jayne BrundageM 26 26 Head of Property Sales Valuation Thomas Gould 20 Christopher Taylor 24 Engineering Services Geoffrey Fitton 43 Jeffrey Fraulino 24 10 Co -head of Valuation 24 Co -head of Valuation 30 Engineer 24 Engineer Accounting, Reporting & Tax Carol Kuta 25 25 Head of Accounting Dene Dobensky 28 6 Director of Tax Planning William Hughes(') 15 5 Head of Research — US Acquisitions Ronald Urdanick(') 38 32 Head of Acquisitions Thomas Barreira 28 28 Region Head Rodney Chu 16 13 Region Head John Connelly 22 12 Region Head David Lawson 33 6 Region Head Michael Mistretta 31 29 Region Head William Moreno 21 12 Region Head Asset Management (z) William Harrison(') 42 18 Head of Asset Mgmt James Fishman 31 27 Region Head David Ingram 40 40 Region Head Alan Green 25 7 Region Head Thomas Enger 24 19 Region Head Legal & Compliance & Valuation Thomas O'Shea(') 18 6 General Counsel Michelle Cullen 25 7 Chief Compliance Officer Client & Portfolio Services Thomas Anathan(') 37 Maria Bascetta 20 Douglas Harper 22 Ronald Lanier 37 Deborah Ulian 17 Wayne Wallace 22 35 Head of Client /Portfolio Svc 20 Relationship Manager 2 Relationship Manager 31 Relationship Manager 11 Relationship Manager 22 Relationship Manager Client Services & Communications Catherine Schuster 25 6 Head of Client Services/ Communications Notes: MMember, UBS Realty Investors LLC Investment Committee ( responsible Asset Management Region Head for the proposed investment is also a voting member Dated: April 5, 2010 T T�7 S IMan al Asset LJ 1! �] Management Multidiscipline d organization As of June 30, 2010 Performance Strategy Measurement & Financial LI Support Dated: July 19, 2010 T BS IMan Asset �J ll Management Investment Operations Acquiring Operating Leasing Selling � Client Service Communications Strategy - Senior Management - Portfolio Management - Research 1 10 7 ♦ Investment Operations - Acquisitions 16 - Asset Management 35 - Dispositions 3 - Engineering 3 ♦ Performance Measurement & Financial - Valuation 4 - Fund & Property Accounting 28 - Corporate Accounting /Operations 3 Client Service & Communications - Client & Portfolio Services 6 - Client Service & Communications 8 Support - Information Technology 13 - Legal & Compliance 10 - Administrative 20 Total 167 AU, CA, CEMEA, HK, SG, UK, and US -1 Cap 7 Overview of Global Real Estate funds in the US As of June 30, 2010 Gross assets - $13.6 billion ($ in millions) Assets by property type Assets by geographic region Farmland $536 Industrial 4% — ____T_'� Ho $7 6 Retc $2,4 19° Assets by fund AFF, $210 TPG, $113 2% i ni TPI, $ 8( TP $8,E 65 apartments $3,830 30% Office b3,874 30% Individual accounts 0 Closed -end accounts $337 2% West $4,181 35% w 17% Midwest $1,435 12% Notes: This represents the breakdown of commercial, multifamily, and farmland properties invested across all strategies, for accounts managed by UBS Realty Investors LLC or UBS AgriVest LLC; Assets by property type and geographic regions represent real estate assets only and exclude other assets of the funds /accounts, such as cash, which are included in Gross Assets. Assets by geographic region exclude farmland. Dated: July 19, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA, HK, SG, UK, and US -I Cap 8 US open -end real estate funds As of June 30, 2010 UBS Property UBS Trumbull Property Income Fund (UBS -TPI) Fund (UBS -TPF) Investment stment strategy Financial objectiveM Leverage Gross assets UBS Trumbull Property Growth & Income Fund (UBS -TPG) UBS AgriVest Farmland Fund, Inc. (UBS -AFF) Core income - oriented Diversified core real Value -added real estate Investing in row, investments — primarily estate — primarily through tactical orientation vegetable and permanent through participating direct ownership of real w /investments through joint crop farmland in select mortgages secured by real estate assets ventures, direct and indirect agricultural areas across the estate assets ownership US Seek to achieve at least a 5% real rate of return (2) Seek to achieve at least a 5% real rate of return( Seek to outperform the NFI- ODCE Index by at least 200 bps Seek to provide a positive total return for each quarterly period regardless of market conditions Low or no Leverage. 0% at 6/3/10 77 71 b in 41 investments Seek to outperform the NFI- ODCE index Moderate 17.0% at 6/30/10 USD 8.9 b in 164 investments Seek to achieve at least a 7% real rate of return( Targget of approximately 50% of GAV 68.7% at 6/30/10 USD 113 million in 6 investments Seek to exceed the Core Farmland Index (CFI) over 3- to 5 -year period Maximum 25% leverage 0% at 6/30/10 USD 210 million in 41 investments Inception 1981 1978 2006 2006 T otal turn�3� One year — 0.91 % One year — (0.93)% One year — (30.72)% One year 2.36% (gross) Ten year — 6.88% Ten year — 6.53% Since inception( — (9.60)% Since inception( 11.21 % Notes: (1) Over any given three- to five -year period unless noted. There is no assurance that the financial objective will ultimately be realized and the possibility of loss does exist. (2) Return adjusted for inflation, before fees. (3) Returns supplement the respective Composite, previously provided or included herein. (4) Inception date of TPG is June 6, 2006 and AFF is June 30, 2006. Dated: July 19, 2010 T BS IMana Asset U �] Managemen# us -I cap US real estate investment experience /` '- ..-9 ... 30, 2010 Over 32 years of core and value added real estate investment experience $13.6 billion of assets for over 300 clients Real estate organization with 167 employees and offices in California, Connecticut, and Texas Quality people, properties and relationships Dated: July 19, 2010 T T�7 [� Man Glo bdi Asset Q T D LJ 1! �] Management AU, CA, CEMEA, HK, SG, UK, and US -1 Cap 10 1670 Broadway, Denver, CO Investment process - strategic approach Portfolio Acquisition/ sales Acquisition Investment Strategy Team managers specialists allocation system Committee Global strategy Portfolio strategy Determine overall ♦ Determine direction /policy portfolio parameters/ Review portfolio objectives investment criteria approve Diversification ♦ Set specific Approve new investment criteria investment concepts for portfolios Tactics pricing Strategies ♦ Meet Products diversification criteria ♦ Manage liquidity ♦ Approve each investment and sale Dated: April 5, 2010 Deal strategy ♦ Have in -depth knowledge of assigned regions ♦ Maintain strong developer relationships ♦ Locate investments /buyers ♦ Analyze and negotiate transactions Criteria Investment /sale approval Suitability Review and approve Diversification underwriting, negotiations, Yield requirements changes, final pricing Deal structure Funding timing Investment size Rotation 4 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA, HK, SG, UK, and US-1 Cap 11 Investment process — new investments Acquisition team Elements Supply & demand for space' Physical conditions Financial projections Developer qualifications Plans and specifications Tenant interview /leases Effect on portfolio Negotiation ' Documentation Dated: April 5, 2010 T T�7 [� Glo bdi Asset LJ 1!�] Management Man AU, CA, CEMEA, HK, SG, UK, and US -1 Cap 12 Market portfolio rationale A market portfolio representing the universe of institutional properties forms the basis for our strategic allocations Source: UBS Global Asset Management, Global Real Estate Research based on data obtained from NCREI, Harvard University, Moody's Economy.com, Reis Reports, Costar Group, Inc., and CBRE Econometric Advisors as of December 31, 2009. Market weights by property type are derived from a measured inventory of space and estimates of price /sq ft each year over the 85 -09 time period and held constant at the 1985 weights over the 78 -84 time period. These weights are applied to annual NCREIF returns by property type to generate the market portfolio returns. Dated: May 4, 2010 T BS IMana Asset U �] Managemen# AU, CH, HK, JP, SG, UK, US -1 RES 13 NCREIF Property Index (NPI) Market portfolio Commercial real estate investable universe Capitalization by property type ♦ The market portfolio is composed of 65 of the largest metropolitan areas in the US, which combine for 33.4 billion square feet of space and a total value of USD 3.2 trillion. Property type Sq ft (bn) USD/ sq ft Apartment Industrial Office Retail 10.5 91 953 30 11.8 37 435 14 6.6 150 989 31 Source: UBS Global Asset Management, Global Real Estate Research; Market Portfolio is based on data obtained from Harvard University, Moody's Economy.com, Reis Reports, Costar Group, Inc., CBRE Econometric Advisors and NCREIF as of December 2009. USD /sq ft has been rounded to the nearest whole dollar. ♦ Hotels are not included in this capitalization Dated: April 30, 2010 T T�7 [� Man al Asset QTD LJ 1! �] Management 4.5 179 Value (USD bn) ( %) . 25 AU, CH, HK, JP, SG, UK, US -1 RES 14 Strategic allocation by property type Target ranges based on investable universe ♦ Strategic weights taken from the market ♦ Tactical positions may deviate from strategic allocation ♦ Diversification is one of several tools to manage portfolio risk ♦ Ranges offer directional guidance, not absolute mandates. Apartme Hotel Industria Office Retail ✓e UBS -TPF A ( %) 28 + 6 + 12 30 24 Tota 1 100 100 100 Source: UBS Global Asset Management, Global Real Estate Research; Market Portfolio is based on data obtained from Harvard University, Moody's Economy.com, Reis Reports, Costar Group, Inc., CBRE Econometric Advisors and NCREIF as of December 2009. NCREIF allocations are as of March 2010. UBS -TPF allocations are as of March 2010. Dated: May 3, 2010 AU, CH, HK, JP, SG, UK, US-1 RES 4 T BS IMana Asset U �] Managemen# 15 Strategic allocation: geography Geographic allocations are based on market weights NCREIF Geographic Division NPI Lower portfolio Upper UBS -TPF (largest m arkets) ( %) guide ( °} guide ( %) Northeast 20 'I5 23 31 24 (NY, Boston, Philadelphia, Newark, Stamford) Pacific 28 17 26 35 19 (Los Ange S an Francisco, Seattle, San Diego, Oakland) Mideast 13 7 11 15 14 (Washington DC, Baltimore, Charlotte, Raleigh) Southeast 12 6 10 14 9 (A tlanta, Miam O rlando, Ft. Lauderdale, Palm Beach) East North Central 9 7 1 0 13 10 (Chicago, Indianapolis, Cincin Detroit, Cleveland) Southwest 10 6 10 14 11 (Houston, Dalla Austin, Fort Worth, San Antonio) Mountain 6 4 6 8 12 (Denver, Phoenix, S alt Lake City, Las Vegas, Santa Fe) West North Central 2 3 4 5 1 (Minneapolis, Kansas City, St. Louis, Omaha) Tota 1 100 100 Source: UBS Global Asset Management, Global Real Estate Research; Market Portfolio is based on data obtained from Harvard University, Moody's Economy.com, Reis Reports, CoStar Group, Inc., CBRE Econometric Advisors and NCREIF as of December 2009. NCREIF allocations are as of March 2010. UBS -TPF allocations as of March 2010. Data may not sum due to rounding. Dated: May 3, 2010 AU, CH, HK, JP, SG, UK, US-1 RES T BS IMana Asset U �] Managemen# 16 Strategic allocation: economic sector Diversity based on national industry exposure ♦ UBS Global Asset Management categorizes stocks into eleven sectors. We combined these to form eight major sectors (including a government and agricultural sector) that are subject to similar economic drivers ♦ GDP and GMP levels can be categorized into these same sectors ♦ Economic diversification is achieved by ensuring that a portfolio's average exposure to the economic sectors is similar to that of the US All values % Market range Top 65 metros Sector Houston San Jose Hi Lo Avg Std dev Discretionary /media /autos 7.7 9.2 27.8 7.7 12.1 2.9 Consumer staples 3.4 3.5 7.4 3.4 5.0 0.9 Energy/utilities/materials 31.6 2.0 31.6 2.0 6.4 5.1 Financials /insurance 11.8 17.5 37.4 9.8 20.6 5.1 Gov't, educ, ag, and military 9.2 10.2 38.1 7.8 15.1 5.2 Healthcare 5.6 7.8 17.0 5.4 9.5 2.3 Industrials 25.1 18.7 29.0 16.1 22.8 2.8 Telecom /technology 5.6 31.1 31.1 2.7 8.5 4.4 Total 100.0 100.0 100.0 Source: UBS Global Asset Management, Global Real Estate Research based on data obtained from Moody's Economy.com as of December 2009. Totals may not sum to 100% due to rounding. Dated: June 15, 2010 AU, CH, HK, JP, SG, UK, US -1 RES T T�7 [� Man al Asset QTD LJ 1! �] Management 17 2010 strategy Current outlook Declining homeownership supports renting Apartment Demographic shifts favor renter household growth + The only sector benefiting from Fannie Mae & Freddie Mac lending Severity of value declines is creating significant buying opportunities Hotel One -night leases allow quicker response to improving demand + RevPAR decline and occupancy losses have been extreme Distribution and trade demand are slowly recovering Industrial Net absorption and rent shifts remain below average + Limited new supply will help sector recovery V Office employment conditions are weak Office Business confidence is slowly improving from historic lows + Fundamentals are poised to remain below average in 2010 Consumer confidence and consumption are slowly improving Retail Retail sales are beginning to grow + Spending habits will take time to recover Source: UBS Global Asset Management, Global Real Estate Research as of December 2009. Dated: April 1, 2010 T T�7 [� Man al Asset QTD LJ 1! �] Management AU, CH, HK, JP, SG, UK, US -1 RES 18 Organizational strengths /distinguishing characteristics Performance record for both value -added and core strategies National market presence; local expertise Continuity and experience of professional staff Commitment to client service Rigorous multi - disciplined acquisition process Expertise in all major property types Successful portfolio takeover experience Strong research department thoroughly integrated into all facets of our business Demonstrated sales discipline Dated: April 5, 2010 T T�7 [� Man al Asset Q T D LJ 1! �] Management AU, CA, CEMEA, HK, SG, UK, and US -1 Cap 19 555 West 17th Street, Denver, CO Overview of UBS Global Asset Management os of March 11 " 1 010 Total invested assets: USD 560 billion Approximately 3,500 employees located in 25 countries ♦ Seven business segments ♦ Value driven investment philosophy Real estate is a prominent business area within UBS Global Asset Management Dated: May 20, 2010 'porate Center 4 S B Man al Asset LJ Management AU, CA, CEMEA, HK, SG, UK, and US -I Cap 20 T T�7 S Man al Asset LJ 1! �] Management SECTION 2 UBS Trumbull Property Fund (UBS-TPF) T T�7 S Man al Asset LJ 1! �] Management UBS Trumbull Property Fund summary As of June 3n 2010 Core, open -end, direct US real estate fund $8.9 billion in gross assets 164 investments 260 clients 17.0% leverage (of Gross Asset Value) 6.53% (annualized 10 -year return) Notes: Return supplements the Firm's Equity composite previously provided or included herein. See Required Notes page at the end of this section or presentation Past performance is not indicative of future results. Dated: July 13, 2010 u B S AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 23 CenterPoint, Chicago, IL Summerwalk, Seattle, WA UBS -TPF portfolio distribution As of June 30, 2010 Portfolio distribution by property type Industrial 12% Ho 7c ments 3% Retail 24% Office 29% Portfolio distribution by geographic region Midwest West 30% w d Notes: Percentages are based on gross market value of real estate investments. Geographic regions as defined by NCREIF. Dated: July 16, 2010 U B S AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 24 UBS -TPF diversification by property type As c#. June 30, 2010 40 ■ Current Distribution Long -term target range 35 all 25 20 fiN'1 10 5 x Notes: Long -term targets are based on current assumptions and information and are subject to change Dated: July 14, 2010 o% BS AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 25 Office Apartments Industrial Retail Other UBS -TPF leasing by property type End of quarter percentage leased ( %) Solano at Miramar, Fort Lauderdale, FL Notes: Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing Dated: April 20, 2010 T BS IMana Asset U �] Managemen# AU, CA, CEMEA, HK, JP, SG, UK, US-1 TPF 26 Dec. 31, 2008 Mar. 31, 2009 Jun. 30, 2009 Sept. 30, 2009 Dec. 31, 2009 Mar. 31, 2010 Office 93 93 93 92 92 93 Industrial 94 92 91 92 90 90 Reta i 1 95 93 91 92 92 90 Apartments 93 95 95 95 94 95 Total 94 93 93 93 92 92 Solano at Miramar, Fort Lauderdale, FL Notes: Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing Dated: April 20, 2010 T BS IMana Asset U �] Managemen# AU, CA, CEMEA, HK, JP, SG, UK, US-1 TPF 26 UBS-TPF debt summary As of Junp 30, 2010 Financing activity - Paid off $22 million loan at maturity - Locked rate at 5.21 % on 18.5 million loan Weighted average interest rate of 5.30% No remaining 2010 debt maturities L Dated: July 16, 2010 sea Alexan CityCenter, Denver, CO AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 27 UBS -TPF annual performance As of June 30, 2010 Notes: Returns supplement the Firm's Equity Composite previously provided or included herein. See Required Notes cage at the end of this section or presentation Past performance is not indicative of future results. UBS -TPF began operations on January 13, 1978, thus the 1978 return is not for a full year. Return is annualized. Dated: July 12, 2010 a% BS AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 28 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 Percent % Net investment income 8.42 9.97 9.68 9.96 9.05 8.87 8.86 8.40 7.53 6.80 5.60 6.06 Net realized /unrealized gain (loss) 0.77 3.39 7.47 7.02 0.67 3.76 4.00 1.04 0.17 0.08 0.13 1.89 Total, before management fee 9.24 13.61 17.69 17.49 9.76 12.87 13.12 9.51 7.71 6.88 5.74 8.04 Total, net of management fee 8.26 12.58 16.65 16.42 8.71 11.80 12.07 8.45 6.67 5.84 4.68 6.97 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Percent % Net investment income 6.36 7.38 7.95 8.60 9.70 9.88 10.33 9.88 8.59 8.73 8.99 Net realized /unrealized gain (loss) (10.12) (12.47) (12.01) (6.76) 2.42 2.14 5.59 12.56 7.33 3.97 7.59 Total, before management fee (4.25) (5.78) (4.78) 1.41 12.30 12.18 16.34 23.34 16.39 12.96 17.08 Total, net of management fee (5.14) (6.48) (5.47) 0.70 11.38 11.09 15.23 22.22 15.33 11.89 15.96 YTD Since 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Inception Percent % Net investment income 8.99 8.38 7.91 7.28 6.85 6.07 5.12 4.96 6.69 3.68 8.05 Net realized /unrealized gain (loss) (6.74) 0.51 1.52 6.89 13.61 10.12 8.49 (11.98) (27.55) 3.40 0.51 Total, before management fee 1.79 8.93 9.52 14.54 21.13 16.65 13.93 (7.46) (22.30) 7.14 8.58 Total, net of management fee 0.86 8.13 8.55 13.49 20.05 15.58 12.84 (8.29) (22.94) 6.72 7.61 Notes: Returns supplement the Firm's Equity Composite previously provided or included herein. See Required Notes cage at the end of this section or presentation Past performance is not indicative of future results. UBS -TPF began operations on January 13, 1978, thus the 1978 return is not for a full year. Return is annualized. Dated: July 12, 2010 a% BS AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 28 UBS -TPF performance As of June 30, 2010 Net investment income 10 8 - 6 4 2 0 0 -2 -4 -6 -8 Net realizedAin realized gain (loss) Total return -0.93 -7.85 -10 Quarter Y -T -D 12 Months CenterPoint Industrial, Gurnee, IL Notes: Returns supplement the Firm's Equity Composite previously provided or included herein. See Required Notes cage at the end of this section or presentation. Past performance is not indicative of future results. Dated: July 12, 2010 o% BS AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 29 UBS -TPF relative performance objective Seek to outperform the NFI -ODCE index over any given 3- to 5 -year period As of June 30, 2010 10 5.1 4.4 5 � 2.1 0 0 c v N N C C Q -10 '.J.7 -7.0 7VIWI 6.5 4.9 -15 -20 2Q10 1 Year ■ UBS -TPF total returns Preliminary NFI -ODCE total returns 3 Years 5 Years 10 Years Source: NCREIF is the source of NFI -ODCE Notes: Returns supplement the Firm's Equity Composite previously provided or included herein. As of June 30, 2010 the Preliminary NFI -ODCE consisted of 10 active funds with total net assets of $42.9 billion. Past performance is not indicative of future results. Dated: July 16, 2010 !� LJBS AU, CA, CEMEA, CN, HK, JP, SG, UK, US-1 TPF 30 Fund level comparison UBS -TPF vs NFI -ODCE Periods ending March 37, 2010 15 10 5 0 -5 -10 -15 -20 -25 -30 -35 -40 -45 ❑ODCE Quartiles NFI -ODCE ♦ UBS -TPF 1 Yr 3 Yrs 5 Yrs 10 Yrs Notes: Returns supplement the Firm's Equity Composite, previously provided or included herein. Please see the Required Notes Section for important information. Past performance is not indicative of future results. Date: May 5, 2010 T T�7 S IMan al Asset LJ 1! �] Management 31 UBS -TPF real return performance objective Seek to provide at least a 5% real rate of return, before management fees, over any given 3- to 5 -year period As of June 30, 2010 10 8 6 4 2 0 ,. 0 -2 -4 -6 -8 - 8.58 3 Years 5 Years 10 Years Since Inception ■TPF Total return ■CPI 0+5% Source: Source of CPI is Bureau of Labor Statistics. CPI is the Consumer Price Index, an inflationary indicator of the standard of living in the US. It is also referred to as the "cost of living" index. Notes: Returns supplement the Firm's Equity Composite previously provided or included herein. See required disclosures slide at the end of this section or presentation Fund Inception date January 13, 1978. Past performance is not indicative of future results. Date: July 20, 2010 T TBC IMana Asset U �] Managemen# AU, CA, CEMEA, CN, HK, JP, SG, UK, US-1 TPF 32 UBS -TPF total sales As of March 31, 2010 1982 4 8,845 8,744 2000 5 75,191 58,319 1983 8 34,977 34,531 2001 1 16,994 14,896 1984 10 61,732 60,340 2002 4 53,126 48,868 1985 13 68,425 65,569 2003 2 17,806 16,194 1986 10 94,339 89,612 2004 6 25,472 24,771 1987 8 198,001 176,560 2005 10 353,876 332,024 1988 4 71,330 67,550 2006 9 143,904 134,162 1989 14 349,075 306,360 2007 15 599,515 580,395 1990 0 - - 2008 9 384,975 366,466 1991 2 24,400 25,100 2009 6 207,855 209,122 1992 8 67,575 65,006 2010 2 28,950 28,267 1993 6 32,347 31,250 Tota 1 168 3,113,561 2,931,438 1994 3 87,983 86,444 1995 2 12,317 11,902 1996 4 43,896 39,508 1997 2 49,058 47,830 1998 0 - - 1999 1 1,597 1,648 Notes: Number of properties sold may include portions of multi - parcel investments, and therefore may not tie to difference in total properties from year to year. From 1982 -2007, sales proceeds and appraised values are net of closing costs. The properties included in the calculation of total sales had been independently appraised or the appraisal reviewed and updated if necessary by an independent appraisal firm generally within 6 months of the date of sale. Dated: April 15, 2010 T BS IMana Asset U �] Managemen# AU, CA, CEMEA, HK, JP, SG, UK, US-1 TPF 33 UBS -TPF positioning As of March 31, 2010 ♦ 92% leased portfolio ♦ Only 7% of commercial leases expiring in the last nine months of 2010 ♦ Value -added exposure approximately 5% ♦ Capital available for investment ai r "-MEN � M { L h 7 Notes: Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing. Dated: April 26, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA, HK, JP, SG, UK, US-1 TPF 34 The Charleston at Boca Raton, Boca Raton, FL Stamford Town Center, Stamford, CT UBS-TPF — 2010 portfolio strategy As of January 1, 2010 ♦ Acquisitions — Active pursuit of quality — Apartment fundamental improvement — Competitive pricing — Consider challenged capital structures and hotels ♦ Asset Management — Focus on income — Prudent use of capital — Green building program ♦ Sales — Enhance fund quality through strategic sales — Capture "scarcity premium" ♦ Other — Actively manage 2011 debt maturities — Satisfy redemption pool Dated: April 5, 2010 U JAS AU, CA, CEMEA (ind. CH), HK, JP, 34i- URPFUS -1 TPF 35 Meridian at Gallery Place, Washington, DC UBS -TPF summary As of June 30, 2070 ♦ Over 32 -year performance track record(') ♦ Excellent geographic and property -type diversification ♦ Quarterly cashflow distribution option ♦ Management fee tied to performance results ♦ Low leverage ppr­ Notes: M Includes predecessor firms Dated: July 16, 2010 U S AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 36 Century Square, Seattle, WA Alexan Lenox, Atlanta, GA Stamford Town Center, Stamford, CT SECTION 2.A UBS Trumbull Property Fund (UBS-TPF) Appendix UBS-TPF summary As of June 30, 2010 Strategy Fund Style, Liquidity and Currency Minimum Investment Fund Investment GuidelinesM Financial Objective( Property type and geographic spread Leverage Structure To seek to provide broad real estate market diversification to maximize portfolio returns while minimizing risk Open -end fund, primarily core real estate, with quarterly liquidity (subject to available capital) Denominated in USD 1 million USD Real estate equity investments a minimum of 70% of Gross Asset Value ( "GAV ") Third Party Joint Ventures limited to 50% of GAV Debt investments a maximum of 30% of GAV (construction loans limited to 10% of GAV) Publicly traded real estate securities or debt instruments maximum of 5% of GAV ♦ Combination of all value -added assets will generally range between 5 -15% of total Portfolio Assets ♦ Seek to achieve at least a 5% real rate of return (i.e. inflation- adjusted return) before management fees, over any given 3 -5 year period. Seek to outperform the NFI -ODCE index over any given 3 -5 year period Primarily apartments, hotels, industrial, retail and office throughout the US ♦ NCREIF property type maximum 50% of GAV ♦ NCREIF region maximum 50% of GAV ♦ Local market (CBSA) maximum of 20% of GAV ♦ Single investment maximum 10% of GAV ♦ Mortgage debt generally not to exceed 20% of GAV ♦ Short -term debt generally not to exceed 15% of GAV Private fund structure incorporating a Delaware limited partnership with private REIT and non -REIT subsidiaries. Advisor subject to ERISA Fiduciary standard of care. Notes: 0 )The Advisor may permit temporary and /or immaterial deviations from the Investment Guidelines from time to time, in its discretion, if the Advisor believes that such deviations are in the best interest of the Fund. (z)There is no assurance that the financial objective will ultimately be realized and the possibility of loss does exist. Dated: July 13, 2010 AU, CA, CEMEA, CN, HK, JP, SG, UK, US -I TPF 38 UBS -TPF ten largest assets As of June 30, 2010 Name Location Value ($ Mil) % Portfolio Galleria Dallas Dallas 390.0 4.7% 135 West 50th Street New York 345.0 4.1% CambridgeSide Galleria Boston 323.0 3.9% Columbia Center Washington DC 211.0 2.5% Montebello Town Center Los Angeles 193.2 2.3% 1670 Broadway Denver 161.0 1.9% 184 Kent Avenue New York 157.8 1.9% Shoppes at Blackstone Valley Worcester 156.3 1.9% Corporate Center Pasadena Los Angeles 155.0 1.9% 555 17th Street Denver 152.8 1.8% 2,245.0 26.9% Dated: July 16, 2010 U S AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 39 Galleria Dallas, Dallas, TX 135 West 50 Street, New York, NY CambridgeSide Galleria, Cambridge, MA Columbia Center, Washington, DC UBS-TPF Advisory fees Investor's Share of NAV' Annual Base Fee First $10 million of investment Next $15 million Next $25 million Next $50 million Next $150 million Above $250 million Notes: Date 95.5 bps 82.5 bps 80.5 bps 79.0 bps 67.0 bps 60.0 bps If average cash for the quarter exceeds 7.5% of the Fund's average NAVE' ) , the Base Fee for the excess will be reduced to 20 bps (pro -rated for the quarter) Incentive Fee Percentage is set at a fulcrum point of 0.15% and ranges from a minimum of 0% to a maximum of 0.25 %. For each 1 % the gross return is above or below the Absolute Return Objective of the CPI( plus 5% per annum, the fulcrum point is adjusted by increments of 0.075% Investors with assets in other designated Trumbull Funds will benefit from participation in the "Family of Funds" program, which provides tiered discounts based on the total assets in all designated Funds. (1) Net Asset Value, USD denominated (z) CPI is the Consumer Price Index, an inflationary indicator of the standard of living in the US. It is also referred to as the "cost of living" index. April 5, 2010 o% L BS AU, CA, CEMEA (incl. CH), HK, JP, SG, UK, US -1 TPF 40 UBS Realty Investors Equity Composite 2004 9 Year -End 9,182 7.40 7.56 15.37 13.06 14.27 25.8 9.2 2.46 Year -End Composite Total Firm Gross of Fees ( %) 6.87 Net of Fees ( %) Range of 21.39 19.73 38.2 Number of Net Assets Net Assets Income Appreciation Total Benchmark Total Gross Returns ( %) Standard Year Accounts (USD millions) (USD millions) Return (Depreciation) Return Return ( %) Return Max Min Deviation 2000 13 4,814 6,382 9.00 7.48 16.97 14.28 15.76 29.4 8.9 3.60 2001 12 5,076 7,908 8.95 (5.67) 2.90 5.64 1.97 12.8 (7.0) 3.67 2002 10 5,217 7,265 8.39 1.23 9.70 5.54 8.77 27.7 2.3 3.97 2003 10 5,972 7,964 7.97 1.28 9.33 9.28 8.36 13.4 (7.5) 2.79 2004 9 7,011 9,182 7.40 7.56 15.37 13.06 14.27 25.8 9.2 2.46 2005 9 8,652 10,910 6.87 13.30 20.84 21.39 19.73 38.2 14.1 2.84 2006 10 11,302 13,940 6.03 10.79 17.30 16.32 16.13 40.6 13.9 2.21 2007 9 12,155 14,798 5.14 8.84 14.31 15.97 13.20 38.6 11.7 2.93 2008 9 10,445 13,285 4.99 (12.21) (7.67) (10.01) (8.47) (4.2) (41.0) 1.91 2009 9 7,995 10,232 6.68 (27.91) (22.68) (29.76) (23.32) (11.8) (62.2) 4.23 Global Real Estate - US (the "Firm ") has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®). The Firm has been verified from 1993, and the Composite examined from January 1, 1997, through December 31, 2008. 2009 verification has not yet been completed. Past performance is not indicative of future results. 1. The Firm The Firm is defined as UBS Realty Investors LLC and UBS AgriVest LLC, together Global Real Estate - US. Both entities are registered with the US Securities and Exchange Commission as investment advisors. Prior to January 1, 1999, UBS AgriVest LLC was a stand -alone firm and was defined separately. On January 1, 2001, the real estate investment management activities of UBS Global Asset Management (New York) Inc. (a provider of non - discretionary investment management services to non -US clients) were integrated into the Firm. 2. The Composite The UBS Realty Investors Equity Composite (the "Composite ") was created in 2005. All results are presented in US dollars. A complete list and description of Firm composites is available upon request. The Composite comprises all fee - paying, non - taxable discretionary accounts that invest primarily in equity real estate including, but not limited to, the following property types: apartments, office, retail, industrial, and hospitality. The strategy of the accounts in the Composite is to acquire investments in US commercial and multifamily real estate (core and value -added properties) expected to provide attractive risk - adjusted returns consisting of current income and capital appreciation. Since October 2003, a sub - adviser has managed the cash for some pooled accounts included in the Composite; previously the sub - adviser was the direct investment manager for the cash. Initially, accounts must have at least $30 million in commitments or assets, including debt, to be included in the Composite. Composite dispersion for any year is represented by both the range and the asset - weighted standard deviation of the gross total returns of the accounts that were in the Composite for the entire calendar year. Discretion is broadly defined as the Firm having discretion over the selection, capitalization, asset management, and disposition of investments within the parameters of a given mandate. 3. Valuation In general, an independent Member of the Appraisal Institute appraises assets annually and reviews adjustments to value quarterly, unless otherwise specified by the client. In general, each property appraisal includes at least an income approach using a discounted cash flow model and a sales comparison approach, which are considered in determining a final value conclusion. The impact of third -party debt is reflected when the related real estate is valued or more often, if necessary. During calendar years 2007, 2008 and 2009, Composite assets externally valued were 95 %, 100% and 100 %, respectively. Date: April 5, 2010 o UBS AU, CA, CEMEA (incl. CH), HK, JP, SG, UK, US -1 TPF 41 UBS Realty Investors Equity Composite (cont.) 4. Calculation of Performance Returns reflect the impact of leverage, which averaged approximately 14.3% of gross asset value (net asset value plus debt) during 2000 through 2009, and approximately 21.8% in 2009. Leverage has consisted primarily of mortgage loans payable that are collateralized by the related real estate investment. The extent to which leverage is used varies by account strategy and may include either portfolio or property level debt. Expenditures, including tenant improvements and leasing commissions that extend the useful life or represent additional capital investments benefiting future periods, are capitalized as a component of cost. Annual returns are time - weighted rates of return calculated by linking quarterly returns. The sum of income and appreciation (depreciation) may not equal total returns due to the linking of quarterly returns. Gross of fees returns are presented before all management fees, but after third -party expenses. Net returns are presented net of the management fees and third -party expenses, but before any applicable insurance company contract charges in effect through February 29, 2008. Additional information regarding the policies for calculating and reporting returns is available upon request. 5. Investment Management Fees The fee schedule below represents the schedule for the largest fund in the Composite, the UBS Trumbull Property Fund (the "Fund "). An Investor's "Annual Applicable Base Fee Percentage" for the Fund is a blended percentage rate derived by reference to the annual Base Fee percentage set forth below and based upon the Investor's share of Net Asset Value in the Fund as of the beginning of the quarter: Investor's share of Net Asset Value in the Fund First $10 million Next $10 million to $25 million Next $25 million to $50 million Next $50 million to $100 million Next $100 million to $250 million Above $250 million Annual Base Fee Percentage 0.955% 0.825% 0.805% 0.790% 0.670% 0.600% To the extent that average cash exceeds 7.5% of the average net assets, the base fee with respect to such excess will be reduced to 20 basis points (pro rated for the quarter). The "Incentive Fee Percentage" is set at a fulcrum point of 0.15 %, and ranges from a minimum of 0% to a maximum of 0.25 %, depending on the performance of the Fund. Please see the applicable Confidential Private Offering Memorandum for more information on how fees are calculated and charged. 6. Benchmark and Market Conditions Effective May 2009, the Firm changed the benchmark retroactively from the property -level NCREIF Property Index ( "NPI ") to a fund -level Index, the NCREIF Fund Index -Open End Diversified Core Equity ( "NFI -ODCE" or the "Index "). We believe a fund -level index provides a more meaningful comparison for a fund -level composite. The NFI -ODCE, first published mid -2005, is a capitalization- weighted, time - weighted, fund -level return index beginning as of the first quarter of 1978, inclusive. It is presented gross of fees. As of December 31, 2009, the NFI -ODCE consisted of 14 active funds with total net assets of $47.7 billion. The real estate market, as measured by NCREIF, reflected a period of recession (2001), and a period of recovery leading to rapid expansion (2004 -2007) followed by recession (2008- 2009). The four years 2004 through 2007 were marked by rapid economic expansion, excess debt capacity and falling risk premiums, leading to the greatest cumulative appreciation in NCREIF history. 2008 was a year of inflection with negative total returns during the third and fourth quarters. Calendar year 2009 posted the largest negative total return since inception of the Index. Date: April 5, 2010 o UBS AU, CA, CEMEA (ind. CH), HK, JP, SG, UK, US -1 TPF 42 Required notes Returns for periods greater than one year are annualized. For the period ending June 30, 2010 UBS -TPF's net total returns for the quarter, year -to -date, one -, three -, five -, and 10 -year periods were 4.9 %, 6.7 %, (1.7) %, (7.8) %, 1.2 %, and 5.6% respectively, after the deduction of management fees, but before the deduction of contract charges. Contract charges were only applicable through February 29, 2008. UBS -TPF returns reflect the reinvestment of income. Returns and dollars are USD denominated. The NCREIF Property Index (NPI) (Source NCREIF) is a property -level index, which consists of existing properties only (development projects and participating mortgages are excluded), excludes cash balances and leverage, and other non - property related assets, liabilities, income and expenses. NFI -ODCE (Source NCREIF) is a fund - level, capitalization weighted index of open -ended diversified core equity commercial real estate funds that includes cash balances and leverage and is reported gross of fees. The degree of leverage used varies among the funds included in NFI -ODCE. Please note that past performance is not a guide to the future. The value of investments and the income from them may go down as well as up, and investors may not get back the original amount invested. Dated: July 12, 2010 o% UBS AU, CA, CEMEA, CN, HK, JP, SG, UK, US -1 TPF 43 Disclaimer - US &Canada © UBS AG 2010. The Key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved. The presentation has been prepared and is provided solely for general information and does not constitute investment advice. Except for individual account proposals, it has been prepared without taking into account any particular client's objectives, financial situation or needs. This material is designed to support an in- person presentation, is not intended to be read in isolation, and does not provide a full explanation of all the topics that were presented and discussed. The opinions expressed in this presentation and any accompanying documents (together referred to as "the presentation ") are those of Global Real Estate, a business unit of UBS Global Asset Management, one of UBS AG's business divisions. Opinions expressed in the presentation may differ from those of other parts of UBS AG and are subject to change. Commingled funds will only be offered pursuant to a Confidential Private Offering Memorandum, or other similar document, and then only to qualified investors on a private placement basis in jurisdictions in which such an offer may legally be made. These funds may not be available to investors in all states and countries. When investing in a commingled fund, investors must read the Confidential Private Offering Memorandum or other governing documents before investing. If there are any discrepancies between information contained in this presentation and the Confidential Private Offering Memorandum and other offering materials, those materials will prevail. The presentation contains confidential information that has been derived from proprietary and non - proprietary sources that may not have been independently verified; accordingly we do not claim or have responsibility for its completeness or inaccuracies. The presentation must not be reproduced, copies circulated or any of the contents otherwise disseminated or used without Global Real Estate's express written permission. Distribution of the presentation, including an electronic copy, may be restricted by law. Anyone who comes into possession of it should obtain advice on and observe any such restrictions. Failing to comply with such restrictions may violate applicable laws. Any forecasts or projections contained in the presentation are opinions only and are based on available information at the time of writing. Accordingly, such statements are inherently speculative as they can be affected by incorrect assumptions or by known or unknown risks and uncertainties. The outcomes ultimately achieved may differ substantially from the forecasts or projections. Past performance is not an indication of future performance. The use of forward - looking information, or any disclaimers surrounding forward - looking information in this document, was not made in accordance with any applicable Canadian legislation relating to such information. The opinions expressed are a reflection of UBS Global Asset Management's best judgment at the time this material was compiled, and any obligation to update or alter forward - looking statements as a result of new information, future events, or otherwise is disclaimed. In the US, the Global Real Estate commingled funds are distributed by UBS Fund Services (USA) LLC, member FINRA /SIPC and other UBS Global Asset Management broker - dealer affiliates. UBS Fund Services (USA) LLC main office is located at 242 Trumbull Street, Hartford, CT 06103. In Canada, the Fund may be offered through UBS Global Asset Management (Canada) Inc. UBS Global Asset Management (Canada), Inc., UBS Realty Investors LLC, the investment adviser, and UBS Fund Services (USA) LLC are subsidiaries of UBS AG. UBS Global Asset Management (Canada) Inc. is a registered ICPM in all provinces and territories of Canada. UBS Realty Investors LLC, UBS Fund Services (USA) LLC and UBS Global Asset Management (Canada) Inc. are members of the UBS Global Asset Management business division. Date: May 10, 2010 UBS V CA and US -1 44 o UB S 45 SECTION 3 UBS Trumbull Property Income Fund (UBS -TPI) T T�7 S Man al Asset LJ 1! �] Management UBS Trumbull Property Income Fund As of June 30, 2010 ♦ Core, open -end, income - oriented US real estate fund ♦ Primarily invested in participating mortgages ♦ $1.1 billion in gross assets ♦ 41 investments ♦ 60 clients ♦ 6.88% (annualized 10 -year return) h r 7 Notes: Return supplements the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation Dated: July 20, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 47 Meridian at Eisenhower Station, Alexandria, VA 100 CambridgePark Drive, Cambridge, MA EIP Industrial, Chicago, IL Investment risk and return Participating mortgage 80% to 90% loan -to -value Conventional mortgage 50% to Equity investment 100 % -of -value 70% loan -to -value Risk (Investment -to -value ratio) Notes Date: This slide is illustrative only of the risk / reward scenario. It is not a guarantee of future returns April 5, 2010 AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -1 TPI 48 Investment return from participating mortgages Fixed component Mortgage payment Variable component Share of net income Tota Share of appreciation in property value upon loan maturity Date: April 5, 2010 return to U BS -TPI LJ B S AU, CA, CEMEA (ind. CH), HK, JP, SG, TW, UK US -1 TPI 49 Participating mortgage structure First mortgage with sharing in cash flow and appreciation Illustrative Example ♦ Warehouse portfolio of nine cross - collateralized loans in Ohio, Florida, Michigan, Pennsylvania, Illinois and Texas ♦ $106.1 million investment (88% loan to value - $29 per square foot) 10 -year term 6.5% Plus 50% Fixed interest + of excess cash flow 7.0% IRR hurdle plus 50% of appreciation Tota I return to UBS -TPI Notes: The 6.5% fixed income rate is for illustration purposes only. It is not intended to represent current rates, which will vary depending upon economic conditions Date: April 5, 2010 lJ B V AU, CA, CEMEA (ind. CH), HK, JP, SG, TW, UK US -1 TPI 50 UBS -TPI portfolio distribution As of June 30, 2010 Portfolio distribution by property type Industrial Hotel 11% Apartments 45% Portfolio distribution by geographic region Midwest 14% West 36% Notes: Percentage may not sum due to rounding. Geographic regions as defined by National Council of Real Estate Investment Fiduciaries ( "NCREIF ") Percentages based on Gross Asset Value Dated: July 15, 2010 lJ B V AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 51 I / %o Office 8% UBS -TPI annual performance As of June 30, 2010 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation UBS -TPI began operations on March 31, 1981, thus the 1981 return is for nine months. Past performance is not indicative of future results. Dated: July 12, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 52 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 Percent % Net investment income 10.59 12.63 11.12 10.89 10.14 9.79 8.67 7.88 7.73 8.04 Net realized /unrealized gain (loss) 7.93 4.08 7.79 2.49 2.01 (0.04) (2.64) 0.05 0.42 (10.87) Total, before management fee 19.06 17.09 19.53 13.58 12.31 9.74 5.85 7.94 8.18 (3.48) Total, net of management fee 18.45 16.24 18.72 12.77 11.49 8.95 5.08 7.13 7.39 (4.21) 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Percent % Net investment income 8.44 9.09 8.57 9.37 9.37 9.64 9.82 8.96 9.00 9.33 Net realized /unrealized gain (loss) (15.04) (8.37) (0.71) 2.07 2.10 5.37 8.16 8.52 1.52 3.44 Total, before management fee (7.55) 0.15 7.81 11.58 11.61 15.39 18.58 18.03 10.62 13.01 Total, net of management fee (8.26) (0.57) 7.13 10.86 10.87 14.58 17.78 17.25 9.86 12.22 YTD Since 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Inception Net investment income 8.98 8.11 7.49 7.17 6.17 5.93 5.73 5.33 5.14 2.92 8.61 Net realized /unrealized gain (loss) (3.38) 0.02 0.02 4.56 8.99 10.35 6.93 (6.35) (22.86) 5.73 0.47 Total, before management fee 5.37 8.13 7.52 11.98 15.57 16.73 12.95 (1.27) (18.63) 8.73 9.09 Total, net of management fee 4.60 7.36 6.79 11.21 14.82 15.96 12.21 (2.07) (19.32) 8.30 8.32 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation UBS -TPI began operations on March 31, 1981, thus the 1981 return is for nine months. Past performance is not indicative of future results. Dated: July 12, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 52 UBS -TPI performance periods ending June 30, 2010 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation. Past performance is not indicative of future results. Dated: July 12, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 53 Quarter( %) Y- T -D( %) 12 Months( %) Net investment income 1.46 2.92 5.60 Net realized /unrealized gain (loss) 4.59 5.73 (4.50) Tota 1 6.05 8.73 0.91 Total, net of management fee 5.84 8.30 0.07 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation. Past performance is not indicative of future results. Dated: July 12, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 53 UBS -TPI investment objective Seeks to provide at least a 5% real rate of return, before fees, over any given three- to five -year period As of June 30, 2010 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation Past performance is not indicative of future results. Dated: July 16, 2010 UBS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 54 Since 3 Yrs (%) 5 Yrs ( %) 10 Yrs ( %) Inception ( %) Net investment income 5.42 5.61 6.77 8.61 Appreciation (8.03) (1.29) 0.11 0.47 Total Return (2.94) 4.26 6.88 9.09 CPI 1.51 2.30 2.37 3.13 Real return (4.45) 1.96 4.51 5.96 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation Past performance is not indicative of future results. Dated: July 16, 2010 UBS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 54 Comparative performance UBS -TPI vs NFI -ODCE Index Periods ending June 30, 2010 10 5 0 0 -5 -10 -15 Notes Dated 6.9 6.1 Ewe 2Q10 1 Year 3 Years ■ UBS -TPI Preliminary NFI -ODCE 5 Years 10 Years Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation. Past performance is not indicative of future results. July 16, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 55 Number of quarters of negative total return performance Since June 30, 1981 (116 quarters) 23 15 10 UBS -TPI NPI 16 Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation Past performance is not indicative of future results. UBS -TPI began operations on March 31, 1981. Date: May 17, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -I TPI 56 BarCap NFI -ODCE 20 -Year Sharpe ratios and returns As of March 31, 2010 Sharpe Ratios and Returns from 1991 Q2 to 2010 Q1 0.5 0.4 0.3 0.2 0.1 0.0 S &P 500 Sharpe Ratio (L) I I�khn' �q Barclays Bond 20 -Yr Return (R) Sharpe Ratio is a measure of risk adjusted return Avg of Qtrly returns — Avg Risk -Free retur Sharpe Ratio = Standard Deviation of Quarterly returns 9% 8% 7% 6% 5% NFI -ODCE Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation Past performance is not indicative of future results. UBS -TPI began operations on March 31, 1981. Date: May 17, 2010 T BS T IMana Asset �J Management AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -I TPI 57 UBS -TPI TPI /TPF vs Competitors: 20 -Year Sharpe Ratios and Returns As of March 31, 2010 Sharpe Ratios and Returns from 1990 Q2 to 2010 Q1 1M 0.3 0.2 0 7 c 6 0 M M� UBS -TPF Competitor Fund 1 Competitor Fund 2 Competitor Fund 3 Sharpe Ratio (L) 20 -Yr Return (R) Sharpe Ratio is a measure of risk adjusted return Competitor Fund 4 5 4 Competitor Fund 5 Sharpe Ratio = Avg of Qtrly returns — Avg Risk -Free return Standard Deviation of Quarterly returns Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation Past performance is not indicative of future results. Six of the funds including TPF have returns going back 20 years. One of these 6 funds split into two, and returns of the original fund and its successor fund in ODCE are included. The funds represent lower risk investment strategies utilizing low leverage. Information for Funds 1 — 5 was gathered from sources believed reliable, but cannot be guaranteed and information concerning their policies covering income reinvestment is not known. TPI is not included in NFI -ODCE. Dated: May 4, 2010 T BS IMana Asset �J Management AU, CA, CEMEA, HK, JP, SG, TW, UK US-1 TPI 58 UBS -TPI UBS -TPI leasing by property type End of quarter percentage leased 12/31/08 3/31/09 6/30/09 9/30/09 12/31/09 3/31/10 Tota I P... 91 92 91 The Grove at Marketplace, Ontario, CA Kifer Tech Center, Sunnyvale, CA Bressi Ranch Self Storage, Carlsbad, CA Notes: Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing Dated: April 5, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA, HK, JP, SG, TW, UK US-1 TPI 59 Apartments 92 94 93 95 94 95 Industrial 91 93 91 92 92 89 Office 91 93 95 96 95 95 Retail 78 80 77 79 79 79 Tota I P... 91 92 91 The Grove at Marketplace, Ontario, CA Kifer Tech Center, Sunnyvale, CA Bressi Ranch Self Storage, Carlsbad, CA Notes: Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing Dated: April 5, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA, HK, JP, SG, TW, UK US-1 TPI 59 UBS -TPI mortgage investments As of March 31, 2010 Property type Number of investments Market value ($ in millions) Leasing M Office 2 36.0 97 Retail 3 104.7 96 Apartments 10 292.1 96 Industrial 12 138.8 95 Hotel 3 96.6 N/A Tota 1 30 W. 12 -month return M Net investment income 5.54 Net realized /unrealized gain (13.49) Tota 1 (8.53) Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation. Past performance is not indicative of future results. (1) Includes one traditional mortgage on an industrial property. (z) Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing (3) Before deduction of management fees. Dated: April 20, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA, HK, JP, SG, TW, UK US-1 TPI 60 UBS -TPI wholly owned properties(" As of March 31, 2010 Net realized /unrealized gain (22.99) Tota 1 (17.17) Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation. Past performance is not indicative of future results. ( These properties have been acquired under the provisions of the ground lease and mortgage loan documents. <(z) Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing Dated: April 20, 2010 T T�7 S IMan al Asset LJ 1! �] Management 61 Market Number of value ($ in Property type investments millions) Leasing Office 4 58.0 93 Retail 2 49.2 56 Apartments 5 101.4 92 Industrial 7 65.9 78 Tota 1 18 274.5 83 12 -month return M Net investment income 7.07 Net realized /unrealized gain (22.99) Tota 1 (17.17) Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation. Past performance is not indicative of future results. ( These properties have been acquired under the provisions of the ground lease and mortgage loan documents. <(z) Leasing numbers exclude hotels, properties in initial lease -up, development and redevelopment properties, or properties where one -time events are impacting leasing Dated: April 20, 2010 T T�7 S IMan al Asset LJ 1! �] Management 61 UBS -TPI total sales /repayments As of June 2010 1984 3 24,269 23,850 2000 2 31,665 29,997 1985 1 4,869 4,869 2001 9 95,656 87,060 1986 0 - - 2002 6 179,624 170,536 1987 2 18,506 18,506 2003 1 32,622 28,677 1988 1 9,600 9,600 2004 4 65,697 62,753 1989 1 5,800 5,400 2005 6 169,134 156,013 1990 6 59,106 58,100 2006 5 83,222 78,678 1991 3 7,706 7,302 2007 5 160,138 153,097 1992 6 26,334 26,900 2008 5 168,288 165,016 1993 11 60,838 56,467 2009 3 75,374 75,524 1994 5 45,758 43,190 2010 9 79,965 78,691 1995 0 - - Tota • 1996 5 72,443 65,849 1997 3 83,224 82,300 1998 2 18,724 17,800 1999 1 3,473 3,200 Notes: Number of investments sold may include portions of multi - parcel investments, and therefore may not tie to difference in total investments from year to year. From 1984- 2007, sales proceeds and appraised values are net of closing costs. Sold properties were independently appraised or the appraisal reviewed and updated if necessary by an independent appraisal firm generally 6 months or less from the actual sale date. In cases of a partial repayment of a mortgage, the last independent appraised value is assumed to be equal to the amount of the repayment. Dated: July 12, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 62 UBS -TPI summary and outlook Strong income return component Geographic and property -type diversification Favorable risk /reward opportunity Historically low volatility New client deposits benefit by immediate participation Distribution reinvestment program Date: April 5, 2010 lJ BS AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -1 TPI 63 Park Apartments, Bellevue, WA Morena Vista, San Diego, CA Mentor Office Building, Santa Barbara, CA SECTION 3.A UBS Trumbull Property Income Fund (UBS -TPI) Appendix UBS-TPI Summary Strategy Fund Style, Liquidity and Currency Minimum Investment Fund Investments GuidelinesM J Performance objectiveW Property type and geographic spread The ongoing, long -term goal for the Fund is to seek to produce attractive risk - adjusted returns by focusing on stable property -level cash flows, diversification, active portfolio management and asset management Open -end, core income - oriented real estate investments, with quarterly liquidity (subject to available capital). Denominated in USD 1 million USD Primarily participating or non - participating mortgages, construction loans, shared appreciation mortgages or real estate that was previously collateral for mortgage investments. Construction loans limited to 25% of GAV (Gross Asset Value) Minimum of 70% of GAV in apartment, office, retail, industrial, self- storage and hotel investments Mortgage loan to value not to exceed 93% including prior senior encumbrances Indirect interests in real estate with debt like features and debt securities (private and public) not to exceed 5% of GAV To seek to achieve at least a 5% real rate of return (i.e., inflation- adjusted return), before management fees, over any three- to five -year period. As a secondary performance objective, the Fund seeks to provide its income - oriented investors with a positive total return for each quarterly period regardless of market conditions. Apartments, hotels, industrial, self storage -, retail and office throughout the US. NCREIF property type maximum 50% of GAV NCREIF region maximum 50% of GAV Local market (CBSA) maximum of 20% of GAV Single investment maximum 10% of GAV Leverage �::] Short -term debt generally not to exceed 15% of GAV Structure Private fund structure incorporating a Delaware limited partnership with private REIT and non -REIT subsidiaries. Notes: (1) The Advisor may permit temporary and /or immaterial deviations from the Investment Guidelines from time to time, in its discretion, if the Advisor believes that such deviations are in the best interest of the Fund. ( z ) There can be no assurance that the performance objective will ultimately be realized and the possiblity of loss does exist. Date: April 5, 2010 AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -I TP 65 UBS -TPI ten largest assets As of June 30, 2010 R Dated: July 15, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 66 Wareham Crossing, Boston, MA Meridian at Eisenhower Station, Alexandria, VA Morena Vista, San Diego, CA Gross Market Name Location Value (USD mil) % Portfolio Meridian at Eisenhower Station Washington, DC 58.1 6.1% Wareham Crossing Boston, MA 50.2 5.3% Meridian Courthouse Commons Washington, DC 49.6 5.2% Morena Vista San Diego, CA 48.9 5.1% Hyatt Princeton Princeton, NJ 42.9 4.5% The Grove Apartments Riverside, CA 39.6 4.1% Rock Creek Landing Apartments Portland, OR 37.9 4.0% Freeport Village Station Portland, ME 37.3 3.9% Novi Town Center Novi, MI 36.2 3.8% Levanto Apartments San Diego, CA 30.5 3.2% 431.2 45.2% R Dated: July 15, 2010 o lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 66 Wareham Crossing, Boston, MA Meridian at Eisenhower Station, Alexandria, VA Morena Vista, San Diego, CA UBS -TPI investment objective Seeks to provide at least a 5% real rate of return, before fees, over any given three- to five -year period As of June 30, 2010 12 8 4 0 -2.94 -4 3 Years Notes: Dated 5 Years 10 Years ■ UBS -TPI ■ CPI +5% 001 Since Inception Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation Past performance is not indicative of future results. July 15, 2010 a lJ BS AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 67 Comparative performance UBS -TPI vs Hybrid Debt Index Periods ending March 31, 2010 8 4 2.5 0 -4 -8 -12 .. di (3.7) (3.7) 3 Years 5 Years 10 Years Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation. Past performance is not indicative of future results. Date: May 4, 2010 ■ UBS -TPI Hybrid Debt Index (HDI) a T BS Maha Asset U �] Managemen# AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US-1 TPI 68 (10.6) 1 Q10 1 Year Comparative performance UBS -TPI vs NCREIF Property Ind Periods ending March 31, 2010 r is 10 5 0 -5 -10 -15 -20 -25 -30 -35 -40 I O\L r (10.6) (9.6) 1 Year 3 Years 5 Years ■ UBS -TPI NCREIF Property Index 6.6 7.1 10 Years Notes: Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes pages at the end of this section or presentation. Past performance is not indicative of future results. Date: April 30, 2010 T T�7 S IMan al Asset LJ 1! �] Management AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US-1 TPI 69 Comparative performance UBS -TPI vs Barclays Capital Aggregate Bond Index Periods ending March 31, 2010 �o 15 10 5 0 -5 -10 -15 -20 .: (10.55) ti FIR � ,O 1 Q10 1 Year 3 Years 5 Years ■ UBS - TPI ■ BarCap US Aggregate Bond Index Notes: Dated 10 Years Returns supplement the Participating Mortgage Funds Composite previously provided or included herein. See Required Notes page at the end of this section or presentation Past performance is not indicative of future results. April 20, 2010 T T�7 S IMan al Asset LJ 1!�] Managemen# AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 70 UBS -TPI recent investments As of June 30, 2010 Commitment Property /location Date Closed Property type Size /units ($ in millions) Colter Park 3/07 Apartments 384 units 29.0 Phoenix, AZ 19 -23 St. Marks Place Apartments 5/07 Apartments/ 41 units 34.0 New York, NY Retail Wareham Crossing 12/07 Retail 544,535 sf 98.0 Wareham, MA Park on Bell 1/08 Apartments 228 units 27.8 Phoenix, AZ Freeport Village Station 2/08 Retail 113,000 sf 56.0 Freeport, ME The Grove at Marketplace 5/08 Apartments 258 units 59.4 Ontario, CA Levanto Apartments 9/08 Apartments 100 units 33.9 San Diego, CA Courtyard by Marriott 9/08 Hotel 162 rooms 36.8 Campbell, CA Southlake Industrial 9/08 Industrial 807,143 sf 21.9 Morrow, GA 390 Wythe Avenue 10/08 Apartments 69 units 36.1 Brooklyn, NY Dated: July 13, 2010 lJ B V AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 71 UBS -TPI Advisor fees "Family of Funds" Fee based on investor's total investment in Designated Real Estate Funds sponsored by UBS Realty Investors LLC Investor's Share of NAV First $10 million of investment Next $15 million Next $75 million Next $150 million Above $250 million Notes Date: Annual Base Fee Percentage 0.970% 0.845% 0.815% 0.790% 0.760% If average cash for the quarter exceeds 7.5% of the Fund's average NAVE the Base fee for the excess will be reduced to 20bps (pro -rated for the quarter) (1) Net Asset Value April 5, 2010 AU, CA, CEMEA (ind. CH), HK, JP, SG, TW, UK US -1 TPI 72 UBS Realty Investors Participating Mortgage Funds Composite Global Real Estate - US (the "Firm ") has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®). The Firm has been verified from 1993, and the Composite examined from January 1, 1997, through December 31, 2008. 2009 verification has not yet been completed. Past performance is not indicative of future results. 1. The Firm The Firm is defined as UBS Realty Investors LLC and UBS AgriVest LLC, together Global Real Estate - US. Both entities are registered with the US Securities and Exchange Commission as investment advisors. Prior to January 1, 1999, UBS AgriVest LLC was a stand -alone firm and each firm was defined separately. On January 1, 2001, the real estate investment management activities of UBS Global Asset Management (New York) Inc. (a provider of non - discretionary investment management services to non -US clients) were integrated into the Firm. 2. The Composite The UBS Realty Investors Participating Mortgage Funds Composite (the "Composite ") was created in 2006. All results are presented in US dollars. A complete list and description of Firm composites is available upon request. The Composite comprises all fee - paying discretionary accounts that invest primarily in mortgages which typically provide both a fixed interest payment and an equity position in the cash flow of income producing properties. The loans are secured by real estate that include, but are not limited to, the following property types: apartments, office, retail, industrial, and hospitality. Occasionally, properties are acquired by exercise of mortgage remedies, options to purchase or the like. As of December 31, 2009, wholly owned real estate consisted of 32% of the real estate investments in the Composite. The strategy of the accounts in the Composite is to invest in construction loans (that will convert into permanent loans) or mortgages secured by investments in US commercial and multifamily real estate expected to provide attractive risk - adjusted returns consisting of current income and capital appreciation. Since October 2003, a sub - advisor has managed cash for the pooled accounts included in the Composite; previously the sub - adviser was the direct investment manager for the cash. Initially, accounts must have at least $30 million in commitments or assets, including debt, to be included in the Composite. Composite dispersion for any year is represented by the range of the gross total returns of the accounts that were in the Composite for the entire calendar year. Discretion is broadly defined as the Firm having discretion over the selection, capitalization, asset management, and disposition of investments within the parameters of a given mandate. Date: April 5, 2010 o% UBS AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -1 TPI 73 Year -End Hybrid Debt Year -End Composite Total Firm Gross of Fees ( %) Index Net of Fees ( %) Range of Number of Net Assets Net Assets Income Appreciation Total Total Gross Returns ( %) Year Accounts (USD millions) (USD millions) Return (Depreciation) Return Return Return Max Min 2000 2 1,206 6,382 9.35 3.29 12.87 9.91 12.08 13.0 8.6 2001 2 1,104 7,908 8.99 (3.32) 5.44 3.84 4.68 7.4 5.4 2002 2 1,025 7,265 8.13 0.02 8.15 3.26 7.38 8.3 8.1 2003 1 1,057 7,964 7.54 (0.07) 7.48 5.03 6.76 N/A N/A 2004 1 1,143 9,182 7.17 4.56 11.98 8.53 11.21 N/A N/A 2005 1 1,215 10,910 6.17 8.99 15.57 14.11 14.82 N/A N/A 2006 1 1,368 13,940 5.93 10.35 16.73 12.50 15.96 N/A N/A 2007 1 1,397 14,798 5.73 6.93 12.95 12.64 12.21 N/A N/A 2008 1 1,376 13,285 5.33 (6.35) (1.27) (4.70) (2.07) N/A N/A 2009 1 1,046 10,232 5.14 (22.86) (18.63) (14.79) (19.32) N/A N/A Global Real Estate - US (the "Firm ") has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®). The Firm has been verified from 1993, and the Composite examined from January 1, 1997, through December 31, 2008. 2009 verification has not yet been completed. Past performance is not indicative of future results. 1. The Firm The Firm is defined as UBS Realty Investors LLC and UBS AgriVest LLC, together Global Real Estate - US. Both entities are registered with the US Securities and Exchange Commission as investment advisors. Prior to January 1, 1999, UBS AgriVest LLC was a stand -alone firm and each firm was defined separately. On January 1, 2001, the real estate investment management activities of UBS Global Asset Management (New York) Inc. (a provider of non - discretionary investment management services to non -US clients) were integrated into the Firm. 2. The Composite The UBS Realty Investors Participating Mortgage Funds Composite (the "Composite ") was created in 2006. All results are presented in US dollars. A complete list and description of Firm composites is available upon request. The Composite comprises all fee - paying discretionary accounts that invest primarily in mortgages which typically provide both a fixed interest payment and an equity position in the cash flow of income producing properties. The loans are secured by real estate that include, but are not limited to, the following property types: apartments, office, retail, industrial, and hospitality. Occasionally, properties are acquired by exercise of mortgage remedies, options to purchase or the like. As of December 31, 2009, wholly owned real estate consisted of 32% of the real estate investments in the Composite. The strategy of the accounts in the Composite is to invest in construction loans (that will convert into permanent loans) or mortgages secured by investments in US commercial and multifamily real estate expected to provide attractive risk - adjusted returns consisting of current income and capital appreciation. Since October 2003, a sub - advisor has managed cash for the pooled accounts included in the Composite; previously the sub - adviser was the direct investment manager for the cash. Initially, accounts must have at least $30 million in commitments or assets, including debt, to be included in the Composite. Composite dispersion for any year is represented by the range of the gross total returns of the accounts that were in the Composite for the entire calendar year. Discretion is broadly defined as the Firm having discretion over the selection, capitalization, asset management, and disposition of investments within the parameters of a given mandate. Date: April 5, 2010 o% UBS AU, CA, CEMEA (incl. CH), HK, JP, SG, TW, UK US -1 TPI 73 UBS Realty Investors Participating Mortgage Funds Composite (cont.) 3. Valuation In general, an independent Member of the Appraisal Institute appraises assets annually and reviews adjustments to value quarterly. In general, each property appraisal includes at a minimum an income approach using a discounted cash flow model and a sales comparison approach, which are con- sidered in determining a final value conclusion. In general, the valuation of a participating mortgage is equivalent to the present value of the anticipated cash receipts to which the structure is entitled including debt service, ground rent, where applicable, and equity participation in the excess cash flow and residual sales proceeds. As of December 31, 2009, 100% of the total value of Composite assets was subjected to an external valuation during the calendar year. 4. Calculation of Performance Annual returns are time - weighted rates of return calculated by linking quarterly returns. The sum of income and appreciation (depreciation) may not equal total returns due to the linking of quarterly returns. Gross of fees returns are presented before all management fees, but after third -party expenses. Net returns are presented net of the management fees and third -party expenses, but before deduction of insurance company contract charges in effect through February 29, 2008. Expenditures, including tenant improvements and leasing commissions that extend the useful life or represent additional capital investments benefiting future periods, are capitalized as a component of cost. Generally, the accounts in the Composite do not borrow funds to make investments. Additional information regarding the policies for calculating and reporting returns is available upon request. 5. Investment Management Fees The base fee for each quarter for UBS -TPI, the largest fund in the Composite, equals the investor's applicable annual base fee percentage (pro -rated for the quarter) times the investor's share of average net asset value, as defined in the fund's limited partnership agreement, for the quarter. The investor's annual applicable base fee percentage is a blended percentage for the fund derived by reference to the following fee scale and based on the investor's share of net asset value in the fund and other designated UBS Realty sponsored funds, as of the beginning of the quarter. To the extent that average cash exceeds 7.5% of the average net assets, the base fee with respect to such excess will be reduced to 20 basis points (pro rated for the quarter). Please see the applicable Confidential Private Offering Memorandum for more information on how fees are calculated and charged. Investor's Share of Net Asset Value in the Fund Annual Base Fee Percentage First $10 million 0.970% Next $10 million to $25 million 0.845% Next $25 million to $100 million 0.815% Next $100 million to $250 million 0.790% Above $250 million 0.760% 6. Benchmark In January 2010, the Firm developed a custom index for UBS -TPI. As such, we have retroactively added an index comparison called the Hybrid Debt Index. The Hybrid Debt Index combines the Barclays Capital US Aggregate Bond yield, which provides the coupon comparison to a participating mortgage, with 75% of the ODCE properties appreciation return for the appreciation comparison. The Firm believes that using the ODCE properties for appreciation will provide a better comparison than using the NCREIF Property Index ( "NPI ") itself because ODCE properties have characteristics similar to UBS -TPI investments in that they are in open -end funds and are valued on a quarterly basis and reported unleveraged. 7. Market Conditions The real estate market, as measured by NCREIF, reflected a period of recession (2001), and a period of recovery leading to rapid expansion (2004 -2007) followed by recession (2008- 2009). The four years 2004 through 2007 were marked by rapid economic expansion, excess debt capacity and falling risk premiums, leading to the greatest cumulative appreciation in NCREIF history. 2008 was a year of inflection with negative total returns during the third and fourth quarters. Calendar year 2009 posted the largest negative total return since inception of NCREIF. Date: April 5, 2010 o UBS AU, CA, CEMEA (ind. CH), HK, JP, SG, TW, UK US -1 TPI 74 Required notes ♦ UBS -TPI is a fund with 74% participating mortgages and 26% properties as of June 30, 2010. ♦ UBS -TPI rates of return are time - weighted and include reinvestment of income and unless otherwise stated are gross of fees. UBS -TPI's net total returns for the quarter, year -to -date, one -, three -, five -, 10 -year, and since inception periods ended June 30, 2010 were 5.84 %, 8.30 %, 0.07 %, -3.71 %, 3.49 %, 6.11 % and 8.32 %, respectively. Net returns are net of advisory fees but gross of contract charges, which were only applicable through February 29, 2008. Returns and dollars are USD denominated. ♦ In January 2010, the firm developed a custom benchmark. The Hybrid Debt Index uses elements from both a bond index - the Barclays Capital US Aggregate Bond index — and the NCREIF Property Index . It combines the Barclays Capital US Aggregate Bond yield, which provides the coupon comparison to a participating mortgage, with 75% of the ODCE properties appreciation yield for the appreciation comparison. We believe that using the ODCE properties within the NPI for appreciation will provide a better comparison than using the NPI itself because ODCE properties have characteristics similar to UBS -TPI investments in that they are in open -end funds and are valued on a quarterly basis. Like all properties included in the NPI, ODCE properties are reported unleveraged. ♦ We have also compared UBS -TPI to other benchmarks commonly used by our investors: — The Barclays Capital Aggregate Bond Index, formerly called the Lehman Brothers Aggregate Bond Index, is an unmanaged index comprised of U.S. investment grade, fixed rate bond market securities, including government, government agency, corporate and mortgage- backed securities between one and ten years. Source of BarCap US Aggregate Bond Index is Morningstar. — The NCREIF Property Index (NPI) (Source NCREIF) is a property -level index, which consists of existing properties only (development projects and participating mortgages are excluded), excludes cash balances and leverage, and other non - property related assets, liabilities, income and expenses. — NFI -ODCE (Source NCREIF) is a fund - level, capitalization weighted index of open -ended diversified core equity commercial real estate funds that includes cash balances and leverage and is reported gross of fees. ♦ Please note that past performance is not a guide to the future. The value of investments and the income from them may go down as well as up, and investors may not get back the original amount invested. Dated: July 13, 2010 lJ B V AU, CA, CEMEA, HK, JP, SG, TW, UK US -1 TPI 75 Disclaimer - US &Canada © UBS AG 2010. The Key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved. The presentation has been prepared and is provided solely for general information and does not constitute investment advice. Except for individual account proposals, it has been prepared without taking into account any particular client's objectives, financial situation or needs. This material is designed to support an in- person presentation, is not intended to be read in isolation, and does not provide a full explanation of all the topics that were presented and discussed. The opinions expressed in this presentation and any accompanying documents (together referred to as "the presentation ") are those of Global Real Estate, a business unit of UBS Global Asset Management, one of UBS AG's business divisions. Opinions expressed in the presentation may differ from those of other parts of UBS AG and are subject to change. Commingled funds will only be offered pursuant to a Confidential Private Offering Memorandum, or other similar document, and then only to qualified investors on a private placement basis in jurisdictions in which such an offer may legally be made. These funds may not be available to investors in all states and countries. When investing in a commingled fund, investors must read the Confidential Private Offering Memorandum or other governing documents before investing. If there are any discrepancies between information contained in this presentation and the Confidential Private Offering Memorandum and other offering materials, those materials will prevail. The presentation contains confidential information that has been derived from proprietary and non - proprietary sources that may not have been independently verified; accordingly we do not claim or have responsibility for its completeness or inaccuracies. The presentation must not be reproduced, copies circulated or any of the contents otherwise disseminated or used without Global Real Estate's express written permission. Distribution of the presentation, including an electronic copy, may be restricted by law. Anyone who comes into possession of it should obtain advice on and observe any such restrictions. Failing to comply with such restrictions may violate applicable laws. Any forecasts or projections contained in the presentation are opinions only and are based on available information at the time of writing. Accordingly, such statements are inherently speculative as they can be affected by incorrect assumptions or by known or unknown risks and uncertainties. The outcomes ultimately achieved may differ substantially from the forecasts or projections. Past performance is not an indication of future performance. The use of forward - looking information, or any disclaimers surrounding forward - looking information in this document, was not made in accordance with any applicable Canadian legislation relating to such information. The opinions expressed are a reflection of UBS Global Asset Management's best judgment at the time this material was compiled, and any obligation to update or alter forward - looking statements as a result of new information, future events, or otherwise is disclaimed. In the US, the Global Real Estate commingled funds are distributed by UBS Fund Services (USA) LLC, member FINRA /SIPC and other UBS Global Asset Management broker - dealer affiliates. UBS Fund Services (USA) LLC main office is located at 242 Trumbull Street, Hartford, CT 06103. In Canada, the Fund may be offered through UBS Global Asset Management (Canada) Inc. UBS Global Asset Management (Canada), Inc., UBS Realty Investors LLC, the investment adviser, and UBS Fund Services (USA) LLC are subsidiaries of UBS AG. UBS Global Asset Management (Canada) Inc. is a registered ICPM in all provinces and territories of Canada. UBS Realty Investors LLC, UBS Fund Services (USA) LLC and UBS Global Asset Management (Canada) Inc. are members of the UBS Global Asset Management business division. Date: May 10, 2010 UBS V CA and US -1 76 i �, i SECTION 4 Exhibits T T�7 S Man al Asset LJ 1! �] Management Real estate investment styles Expected return Treasury bonds Expected risk Source: UBS Global Asset Management, Global Real Estate Research. ♦ Core real estate has risk and return characteristics that fall between stocks and bonds. ♦ There are many other forms of real estate with characteristics that may fall higher or lower on this scale. Dated: January 11, 2010 [ Global Asset O P U lJ Management AU, CH, HK, JP, SG, UK, US -1 RES 79 US investment characteristics Stocks, bonds, international stocks and real estate 1978 -2009 Source: UBS Global Asset Management, Global Real Estate Research based on data obtained from Morningstar, the Bar -Cap Aggregate Bond Index, EAFE International Stock Index, S &P 500 Stock Index, IA SBB1 US Small Stock Index, NAREIT and the NCREIF Property Index as of December 31, 2009. Means are annualized returns consistent with methodology used by NCREIF. Std dev and Correlations are based on December ending annual returns. ♦ Stocks provided historically high real returns over the 1978 -2008 time period ♦ The return generated by direct real estate investment was lower than that of stocks but with lower volatility, low correlations with stocks, and a positive correlation with inflation ♦ Over periods that span both rising and falling inflation rates, real estate should provide attractive risk - adjusted returns relative to stocks and bonds Dated: February 5, 2010 T T Global Asset LJ B S Management AU, CH, HK, JP, SG, UK, US -1 RES 80 Mean Std dev Correlations Nominal Real Nominal Lg Sm CPI Bonds Int'I REITs RE (%) (%) (%) stock stock CPI 4.0 - 3.0 1.00 Bonds 8.3 4.3 7.1 (0.22) 1.00 International 10.8 6.8 23.2 0.04 0.03 1.00 Lg stocks 11.3 7.3 17.4 0.12 0.24 0.64 1.00 Sm stocks 13.5 9.5 21.1 0.27 0.05 0.46 0.69 1.00 REITs 12.4 8.4 18.0 0.18 0.14 0.39 0.52 0.75 1.00 Real estate 1 8.8 4.81 8.31 0.43 (0.14) 0.19 0.14 0.09 0.12 1.00 Source: UBS Global Asset Management, Global Real Estate Research based on data obtained from Morningstar, the Bar -Cap Aggregate Bond Index, EAFE International Stock Index, S &P 500 Stock Index, IA SBB1 US Small Stock Index, NAREIT and the NCREIF Property Index as of December 31, 2009. Means are annualized returns consistent with methodology used by NCREIF. Std dev and Correlations are based on December ending annual returns. ♦ Stocks provided historically high real returns over the 1978 -2008 time period ♦ The return generated by direct real estate investment was lower than that of stocks but with lower volatility, low correlations with stocks, and a positive correlation with inflation ♦ Over periods that span both rising and falling inflation rates, real estate should provide attractive risk - adjusted returns relative to stocks and bonds Dated: February 5, 2010 T T Global Asset LJ B S Management AU, CH, HK, JP, SG, UK, US -1 RES 80 Real estate and capital markets indices Real estate, stocks, bonds and CPI 60 45 30 0 15 0 • NCREIF Property Index S &P 500 Stock Index • Barclay's Capital US Gov /Credit Bond Index Consumer Price Index ■ M == Em -15 1 Year 3 Years 5 Years 10 Years Source: UBS Global Asset Management, Global Real Estate Research based on data obtained from NCREIF, Morningstar, Bureau of Labor Statistics as of March 2010. CPI is seasonally adjusted. Dated: May 13, 2010 AU, CH, HK, JP, SG, UK, US-1 RES T T [ Global Asset LJ B S Management 81 Valuation program ♦ PricewaterhouseCoopers (PwQ administers the valuation program for several commingled funds managed by Global Real Estate - US, including appraiser bidding, rotation and recommendation and appraisal review. UBS retains an internal valuation team to manage the program. ♦ All properties inspected and appraised annually. ♦ All appraisals certified by appraisers holding the MAI designation. ♦ Appraisals prepared in conformity with USPAP. ♦ All properties not scheduled for appraisal will be reviewed quarterly to identify potential material value changes resulting from changes in appraisal assumptions, changes at the property or changes in the market. As part of this review, PwC compares appraisal assumptions relative to peer set data; updates cash flow models to incorporate property changes that have occurred since the previous quarter; and utilizes its "scoring system" to quantify changes in market conditions for each property. ♦ Appraisals are obtained for all properties identified as having potential material value changes. ♦ Properties are rotated every 3 -5 years to a new appraisal firm. Appraisal review PwC reviews all draft appraisals, including cash flow and market assumptions and support and pro forma projections. PwC works with UBS asset management to ensure accuracy of factual data, including lease terms. PwC uses robust, real -time data from peer group clients in analyzing UBS property valuations by peer group to gauge consistency in methodology, pricing and applied judgment. UBS valuation team and Valuation Committee* will provide an additional high level review for consistency across properties and accounts. Management reports prepared to communicate valuation results. Independent auditors annually examine each fund's financial statements, to include appraisal documentation. *The Valuation Committee is comprised of the chief executive officer of Global Real Estate — US, the portfolio managers, asset management region heads, managing directors, general counsel and the co -heads of Valuation. Dated: April 5, 2010 UBS AU, CA, CEMEA, HK, SG, UK, and US -1 Cap 82 o UB S 83 SECTION 5 UBS Global Real Estate Strategies and Funds T T�7 S Man al Asset LJ 1! �] Management T T�7 S Man al Asset LJ 1! �] Management 85 T TD S Global Asset OP Management) Management UBS Trumbull Property Fund Flash report Second quarter 2010 For limited distribution to institutional investors Portfolio distribution by property type' Objective The UBS Trumbull Property Fund (UBS -TPF) is an actively managed core portfolio of equity real estate. The Fund seeks to provide attractive returns while limiting downside risk. The Fund has both relative and real return objectives. Its relative performance objective is to outperform the NFI -ODCE index over any given three- to five -year period. The Fund's real return performance objective is to achieve at least a 5% real rate of return (i.e., inflation- adjusted return), before advisory fees, over any given three- to five -year period. Highlights • Net investment income before fees was $142.1 million. The second quarter returns also reflect a net realized and unrealized gain of $214.6 million. • UBS -TPF acquired the Buckingham Hotel, a 130 -room boutique hotel in New York, NY for a gross purchase price of $90.0 million. Also in three separate transactions on June 30th and July 1 st, the Fund acquired the remain- ing interests in two regional malls, CambridgeSide Galleria and Montebello Town Center for a total gross purchase price of $139.4 million. • The Fund paid off the $21.9 million mortgage on its Washington DC office building, 1101 Vermont Avenue, at maturity. • The Fund sold part of a larger retail center in Paramount, CA for a gross sales price of $4.8 million and a 14 -acre parcel of undeveloped land in Sturtevant, WI for a gross sales price of $0.7 million. Total returns by property type Periods ending 6/30/2010 Apt Quarter ( %) 9.82 12 months ( %) 0.97 Hotel Ind Office Retail 3.37 1.92 4.48 5.93 -6.29 -6.85 4.89 -3.19 Retail $8.9 Ion 24% Apartments Net asset value (NAV) 28% Income Hotel Office 7% 29% 3.09 Debt as % of GAV Industrial Total (before fees) 12% Key statistics Gross asset value (GAV) $8.9 Ion Quarterly returns (%) Net asset value (NAV) $7.2 Ion Income 2.04 Cash as % of GAV 5.9% Appreciation 3.09 Debt as % of GAV 17.0% Total (before fees) 5.13 Total (after fees) 4.93 Number of investments 164 Number of investors 260 One -year rolling returns (%) Income 7.36 Deposits $267.2 m z Appreciation (7.85) Redemptions $92.9 m z Total (before fees) (0.93) Total (after fees) (1.71) Performance for periods ending June 30, 2010 Gross returns 10 8.58 6.53 5 2.13 0 -5 -10 7.03 3 Years 5 Years 10 Years Since Inception Inception date January 13, 1978 Returns for periods greater than one year are annualized. Distribution by geographic division' 11.8% w 10.9% T . • Pacific Mountain • West North Central East North Central • Southwest F Southeast ■ Northeast ■ Mideast 'Percentage of gross market value of real estate investments. 'Deposits and redemptions for the second quarter of 2010 were recorded in July 2010. This summary is not an offer, a solicitation, or advertisement to purchase or sell securities or interests in the Fund. The Fund will only be offered pursuant to a confidential offering memorandum and then only to accredited investors on a private placement basis in jurisdictions in which such an offer may be legally made. The Fund may not be available to investors in all jurisdictions investors should consult their legal and tax advisors regarding investment in the Fund. The UBS (US) Trumbull Property Fund LP (UBS -TPF) is a Delaware limited partnership and is part of the group of funds known as the UBS Trumbull Funds. The Fund is denominated in USD. Returns include reinvestment of income and are before deduction of management fees. Net returns for the three -, five -and ten -year periods ended 6/30/2010 were (7.83) %, 1.23% and 5.59% and the net return since inception was 7.61 %. All returns shown are before the deduction of contract charges, which are only applicable through February 29, 2008. With property investment, the underlying assets are very illiquid and redemptions may be delayed. Past performance is not indicative of future results and the possibility of loss does exist. UBS Realty Investors LLC 242 Trumbull Street Hartford, CT 06103 -1212 Tel. +1- 860 -616 9000 Fax. +1- 860 -616 9104 www.ubs.com /reaIestate In the US, investment in the Fund is offered by UBS Fund Services (USA) LLC member FINRA and SIPC. In Canada, the Fund may be offered through UBS Global Asset Management (Canada) Inc. © UBS 2010. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved. Published July 15, 2010. .� T B Global Asset OP �J Management Second quarter 2010 For limited distribution to institutional investors UBS Trumbull Property Income Fund Flash report Objective The UBS Trumbull Property Income Fund (UBS -TPI) offers a combination of fixed returns and participation in the cash flows and market value changes of commercial real estate investments. The investment objective of the account is to seek to achieve at least a 5% real rate of return (i.e., inflation- adjusted return), before fees, over any three- to five -year period. Portfolio distribution by property type' Retai 17°/ Office 8% ortments 45% Indust 19°/ 11% Key statistics Gross asset value (GAV) $1.1 bn Quarterly returns (%) Net asset value (NAV) $1.1 bn Income 1.46 Highlights Cash as % of GAV 12.9% Appreciation 4.59 Total (before fees) 6.05 • Net investment income before advisory fee was $15.0 Total (after fees) 5.84 million, approximately the same as last quarter. Number of investments 41 Number of investors 60 One - year rolling returns (%) • All investments were externally appraised. The account Income 5.60 recognized a net realized /unrealized gain of $47.1 Deposits $30.7 m z Appreciation (4.50) million. Redemptions $17.4m z Total (before fees) 0.91 Total (after fees) 0.07 • In April, we sold an office and industrial portfolio of seven properties in Austin, TX for net sales proceeds of Performance for periods ending June 30, 2010 $42.3 million. Gross returns • Redemptions subsequent to quarter end totaled $17.4 909 million, and the redemption pool was fully satisfied. 10 6.88 • Deposits subsequent to quarter -end totaled $30.7 million. 5 4.26 0 Total returns by property type -5 -2.94 Periods ending 6/30/2010 Apt Hotel Ind Office Retail 3 Years 5 Years 10 Years Since Inception Quarter (%) 10.84 2.72 2.26 5.49 5.58 12 months ( %) 2.78 -3.36 -2.92 -2.53 8.37 Inception date March 31, 1981 Returns for periods greater than one year are annualized. Distribution by geographic division' 3.6% - ;-0 4� i Pacific Mountain West !North Central East North Central • Southwest • Southeast • Northeast • Mideast 'Percentage of gross market value of real estate investments 2 Deposits and redemptions for the second quarter of 2010 were recorded in July 2010. This summary is not an offer, a solicitation, or advertisement to purchase or sell securities or interests in the Fund. The Fund will only be offered pursuant to a confidential offering memorandum and then only to qualified purchasers on a private placement basis in jurisdictions in which such an offer may be legally made. The Fund may not be available to investors in all jurisdictions investors should consult their legal and tax advisors regarding investment in the Fund. The UBS (US) Trumbull Property Income Fund LP (UBS -TPI) is a Delaware limited partnership and is part of the group of funds known as the UBS Trumbull Funds. The Fund is denominated in USD. Returns include reinvestment of income and are before deduction of management fees. Net returns for the three -, five- and ten -year periods ended 6/30/2010 were (3.71) %, 3.49% and 6.11 % and the net return since inception was 8.32 %. All returns shown are before the deduction of contract charges, which are only applicable through February 29, 2008. With property investment, the underlying assets are very illiquid and redemptions may be delayed. Past performance is not indicative of future results and the possibility of loss does exist. In the US, investment in the Fund is offered by UBS Fund Services (USA) LLC member FINRA and SIPC. In Canada, the Fund may be offered through UBS Global Asset Management (Canada) Inc. UBS Realty Investors LLC 242 Trumbull Street Hartford, CT 06103 -1212 Tel. +1- 860 -616 9000 Fax. +1- 860 -616 9104 www.ubs.com/realestate © UBS 2010. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved. Published July 15, 2010. T TD S Global Asset OP Management) Management Second quarter 2010 For limited distribution to institutional investors UBS Trumbull Property Growth &Income Fund Flash report Portfolio distribution by property type' Cash 9% cents Yo Objective UBS Trumbull Property Growth & Income Fund (UBS -TPG) is an open -end real estate fund that builds on our 30 years of experience investing in US real estate. It is an actively managed fund utilizing both a broad range of value added strategies and tactical market selection to enhance returns. Leverage is targeted to be approximately 50% of its gross asset value. The Fund's return objective is, on a relative basis, to seek to exceed the NFI -ODCE Index by at least 200 basis points per annum over any given three- to five -year period. The secondary absolute objective is to seek to achieve at least a 7% real rate of return (i.e., inflation- adjusted return), before management fees, over any given three- to five -year period. Retail 19% Office 26% Key statistics Gross asset value (GAV) Net asset value (NAV) Cash as % of GAV Debt as % of GAV Land 2% idustrial 24% $113 m Quarterly returns (%) $34 m Income 3.72 8.6% Appreciation 2.22 68.7% Total (before fees) 5.94 unrealized gain for the quarter. This is the Fund's first Total (after fees) 5.31 Number of investments 6 Highlights Number of investors 1 One -year rolling returns (%) • All of the Fund's investments were valued by third party Income 9.58 independent appraisers resulting in $0.7 million of Appreciation (37.38) unrealized gain for the quarter. This is the Fund's first Total (before fees) (30.72) quarter of positive appreciation since 3Q 2008. Total (after fees) (32.15) • The Fund entered into a Purchase and Sale agreement Performance for periods ending June 30, 2010 for its retail investment in LaGrange, IL. This sale is Gross returns expected to occur in the third quarter. 0 • UBS -TPG addressed its largest 2010 lease rollover during Off the quarter by executing a 45 -month extension with its -9.60 existing 187,000- square -foot tenant in the 10/375 -17.39 Industrial Portfolio. 25 -30.72 • Consistent with our strategy to offer attractive amenities and superior function to our current and prospective office tenants we have obtained LEED Silver Certification for the Fund's office buildings in Woburn, MA. -50 1 Year 3 Years Since Inception Inception date June 6, 2006 Returns for periods greater than one year are annualized Distribution by geographic division 26.5% r Property Building area, Ownership ■ Pacific Mountain ■ West North Central East North Central ■ Southwest Apartment San Jose 110 units Southeast IN Northeast ■ Mideast Property Building area, Ownership 'Distribution by property type includes real estate assets at gross market value plus cash and cash equivalents. type CBSA # units, or acres structure z Percentage of gross market value of real estate investments. Apartment San Jose 110 units Wholly owned This summary is not an offer, a solicitation, or advertisement Industrial El Paso 1,095,407 SF Joint Venture to purchase or sell securities or interests in the Fund. The Fund will only be offered pursuant to a confidential offering memorandum and then only to qualified investors on a Land Boston 10.7 acres Joint Venture private placement basis in jurisdictions in which such an offer may be legally made. The Fund may not be available to Office Boston 218,789 SF Joint Venture investors in all jurisdictions investors should consult their legal Retail Boston 32,500 SF Joint Venture The UBS (US) Trumbull Property Growth & Income Fund LP (UBS -TPG) is a Delaware limited partnership and is a part of the group of funds known as the UBS Trumbull Funds. Retail Chicago 67,767 SF Wholly owned The Fund is denominated in USD. Returns include reinvestment of income and are before deduction of management fees. Net returns reflect the deduction of the asset management fee, but do not include the Fund's incentive fee or the reduced fee that will be available for two years after the first Founding Investor enters the Fund. Net returns for the one- and three -year periods ended 6/30/2010 were (32.15)% and (18.77)% and the net return since inception was (11.05) %. UBS Realty Investors LLC 242 Trumbull Street With property investment, the underlying assets are very illiquid and redemptions may be delayed. Past performance Hartford, CT 06103 -1212 is not indicative of future results and the possibility of loss Tel. +1- 860 -616 9000 does exist. Fax. +1 -860 -616 9104 In the US, investment in the Fund is offered by UBS Fund www.ubs.com /reaIestate Services (USA) LLC member FINRA and SIPC. In Canada, the Fund may be offered through UBS Global Asset Management (Canada) Inc. © UBS 2010. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved. T TD S Global Asset OP Management ) Management UBS AgriVest Farmland Fund, Inc. Flash report Objective The UBS AgriVest Farmland Fund, Inc. (the Fund) is an open -end, infinite life, private REIT permitting quarterly contributions and redemptions based on independent appraised values. The investment objective of the Fund is to provide competitive, risk - adjusted total returns from diversified exposure to US farmland by investing in row, vegetable and permanent crop farmland in select agricultural areas across the United States. Our investments are wholly owned and leased to commercial farm operators. UBS AgriVest LLC, the advisor, selects invest- ments in which it believes there is the opportunity for favorable current income and long -term capital apprecia- tion. The Fund is targeting total annualized returns, before advisor fees, that exceed the Core Farmland Index (CFI) over 3- to 5 -year periods. Second Quarter 2010 For limited distribution to institutional investors Portfolio distribution by property type Vegetable 29% Annual 66% UBS AgriVest Farmland Fund key statistics Period ended June 30, 2010 Since Returns( %) Quarterly One Year Three Years Inception Income 1.21 4.37 4.00 3.94 Appreciation (0.81) (1.95) 4.67 7.06 Total (before fees) 0.40 2.36 8.81 11.21 Total (after fees) 0.13 1.32 7.75 10.15 Gross asset value (GAV) $210.1 m Number of investments 41 Net asset value (NAV) $185.2 m Number of acres 48,143 Cash as a % of GAV 1.0% Number of investors 24 Inception date June 29, 2006 See accompanying notes on reverse page Returns for periods greater than one year are annualized Highlights • Total returns were 2.36% over the past year and 11.21 % Two stockholder commitments were received during since inception. the quarter. • Net unrealized gain on investments was approximately $(1.57) million in the quarter. • Four acquisitions closed during the quarter. Two new farms located in Georgia and Oregon, and two add -on tracts in Idaho and Illinois. • Two deposits were received during the quarter. • There are no pending acquisitions under contract at quarter end. Permanent E�o Farmland overview Investments in core US farmland historically have demonstrated stable income, diversification for a traditional stock, bond and /or real estate portfolio, and protection from inflation. We offer investors an opportunity to invest in farmland through individual accounts and a fund structure that invests in high - quality, income - producing agricultural properties, diversified across the prime farming regions of the United States. Below are the NCREIF farmland regions and the competitive advantages of US agriculture. Portland Los • Geography: — Largest cropland mass in the world located in latitudes favorable to crop production — Midway between major export markets of Europe, Asia, Mexico and Canada • Infrastructure: — Mississippi, Ohio, Columbia Rivers — Rails, highways — Port facilities - New Orleans, Portland, Houston, Los Angeles, Baltimore UBS AgriVest LLC 242 Trumbull Street Hartford, CT 06103 -1212 Tel. +1- 860 -616 9200 Fax. +1- 860 -616 9204 www.ubs.com /reaIestate Seattle • Technology & capital: — Biotechnology, mechanical, conservation — Land grant colleges, agricultural extension programs — Innovative farmers with strong management skills — Well- capitalized farm economy • Dominant global export market share: — Increasing global demand from improving income in developing countries and alternative fuels (ethanol and biodiesel) — US is most efficient and reliable producer Returns reflect the reinvestment of income. Past performance is not indicative of future results and the possibility of loss does exist. This is not an offer or solicitation or advertisement to purchase or sell securities or interests in the fund or any other fund. The fund will only be offered pursuant to a confidential offering memorandum and then only to qualified investors on a private placement basis in jurisdictions in which such an offer may be legally made. Investors should consult their legal and tax advisors before making an investment in the fund. In the US, the fund is distributed by UBS Fund Services (USA) LLC, member FINRA/SIPC or other UBS Global Asset Management broker - dealer affiliates. UBS Fund Services (USA) LLC main office is located at 242 Trumbull Street, Hartford, CT 06103. In Canada, the fund may be offered through UBS Global Asset Management (Canada) Inc. orp BS Global Asset U J Management For limited distribution to consultants and qualified investors UBS Allegis Mortgage Fund ■ ■�� 17 F- 1DID! L ■C�lJL7�f 1]C FI1 J OH N II 1 144, 1 11111.11 -. »)11111 Investment Objective The Fund's objective is to provide an attractive total return over the life of the Fund derived primarily from mortgage loans originated or acquired by the Fund. Annual total returns in the range of 9% to 12% after fees are targeted. Sponsor The US real estate business of UBS Global Asset Management has been an investor in both debt and equity real estate for over 30 years. We presently manage over USD 13 billion in equity real estate and mortgage loan assets, as of September 30, 2009. This market presence provides access to top quality real estate owners and developers as well as extensive knowledge of US markets. Strategy The Fund will originate or acquire mortgage loans on well - located, stabilized commercial real estate assets owned by experienced, well - capitalized sponsors. Investments will seek to capture the existing premiums available in the commercial mortgage debt market due to a divergence of supply and demand. Senior positions in the mortgages will be sold to institutional investors while the Fund retains the junior component and services the loans. Our combination of equity and debt underwriting experience is particularly valuable in the current market environment. Rather than invest in existing loans, we will use our underwriting experience to focus on evaluating real estate collateral. This process includes extensive exposure to the property, local market, national market and economic environment. Solid investment strategy Unique conditions Net commercial and multifamily mortgage flows have been plummeting from the peak rate in late 2007, as shown in Exhibit 1. Although the supply of debt financing for real estate has contracted, Exhibit 2 reveals an accelerating level of mortgage maturities over the next four years, combined at more than USD 1 trillion. This rate of maturity is three times greater than the average rate over the previous 20 years. Using prudent underwriting standards similar to that of the life insurance companies, the Fund will be able to acquire a portion of this void while minimizing potential delinquency, as shown in Exhibit 3, which is Exhibit 1 - Total net flows USD billions 400 350 300 250 200 150 100 50 0 -50 -100 -150 -200 -250 1Q07 3Q07 1Q08 3Q08 1Q09 3Q094Q09 Moody's Economycom as of December 31, 2009. Tactical still quite low. Furthermore, recent equity value declines allow mortgage origination with less capital exposure and more risk - reducing terms than recently available. The dislocation between supply and demand arises from changes in the market structure. Specifically, the rapid rise and fall of CMBS and RMBS lending caused a disruption that will not be resolved in only a few years. In the mean time, unique lending conditions offer significant credit spreads that can be captured while adhering to historically stringent mortgage requirements. UBS Allegis Mortgage Fund seeks to capitalize on this very opportunity. Exhibit 2 - Expected maturity USD billions 350 Banks ■ Life Co ■ Other ■ CMBS 300 250 200 150 100 50 0 07 08 09 10 11 12 13 Foresight Analytics as of May 2009. The current market environment presents an opportune time to take advantage of the mortgage credit shortage. UBS Allegis Mortgage Fund will focus on meeting this growing need while bringing credit premiums to investors. By splitting the mortgages into A and B notes and selling the A notes the Fund can seek to enhance returns while still maintaining governance of the underlying security. Exhibit 3 - Delinquency rate 9 Commercial banks 8 — Life insurers — CMBS 7 6 4 3 2 1 _-_� ",-�J_ 0 3Q01 2Q04 1Q07 4Q09 Moody's Economy.com as of December 31, 2009. Name UBS Allegis Mortgage Fund Structure Unlisted, direct, closed -end fund Investment Advisor UBS Realty Investors LLC Investment Objective Provide an attractive total return over the life of the Fund derived primarily from Mortgage Loans originated or acquired by the Fund Geographic focus United States Target Fund Closing Initial close 2010, final close within 12 months of initial close Target average term 5 to 7 years Target Return objective 9% to 12% after fees Target Fund size USD 500,000,000 (maximum size USD 1,000,000,000) Minimum commitment USD 10,000,000 Fees Annual asset management fee 85 bps on invested capital, 60 bps for year one for initial -close investors only. Incentive fee of 20% of yield in excess of 8% to investors. For more information please contact: Tom Anathan at +1- 860 -616 9128 or your Client and Portfolio Services representative Hartford UBS Realty Investors LLC UBS Fund Services (USA) LLC 242 Trumbull Street Hartford, CT 06103 Disclaimers San Francisco UBS Realty Investors LLC 455 Market Street Suite 1540 San Francisco, CA 94105 This document is intended for limited distribution to consultants and qualified purchasers for determining whether they are interested in receiving a presentation or a draft confidential Private Placement Memorandum setting out certain information in relation to the Fund ( "the PPM "). The Fund has not yet been formed; therefore terms are indicative and subject to change. The information contained in this Document is selective, does not purport to contain all the information that potential investors should consider to form the basis for deciding whether or not to invest and does not include a description of any risk. An investment in the Fund will involve significant risks detailed in the PPM. Investors must have the financial ability and willingness to accept risks, including among others, the risk of loss of investment and lack of liquidity. The information contained in this document does not constitute a distribution nor should it be considered a recommendation to purchase or sell any particular security or fund. Interests in the Fund can only be made via a confidential private placement memorandum. A number of comments relating to future prospects which are "forward- looking" including fund and return objectives are subject to certain risks and uncertainties that can cause the actual results to differ materially. The opinions expressed are those of UBS Realty Investors LLC and may differ from other groups of UBS AG. UBS Fund Services (USA) LLC, member FINRA and SIPC, will act as the non - exclusive distributor of the Fund. © UBS 2010. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved. Published May 13, 2010. S Global Asset For institutional and professional LJBS Management investors only an Gemdale UBS / Gemdale China Real Estate Fund I Overview A residential property development fund in a dynamic emerging market, combining specialist investment and local sector expertise. Key terms (IRR) of 20% p a., net of costs, management Fund Name UBS/ Gemdale China Real Estate Fund I Fund manager UBS / Gemdale Investment Management Ltd Asset manager Managed in partnership with Gemdale focus Corporation, with UBS Global Asset Strategy Management acting as controlling Fund Manager Structure Cayman Isles limited partnership Fund life Closed- ended. Five years, plus two one -year extensions, subject to investor approval Launch date 31 March 2010 Fund size USD 500 million (maximum) Target Fund The Fund targets an internal rate of return return (IRR) of 20% p a., net of costs, management fees and expenses calculated over the life of the Fund Geographic Focused on first' and second tier cities across focus the People's Republic of China' Strategy To develop mid to high end residential real estate projects in mainland China Currency USD denominated Investment USD 10 million (minimum)° Management 2% p.a. on committed capital during the fee investment period, and 2% p.a. on invested capital thereafter Performance fee Hurdle rate of 10% IRR p.a., with an 80/20 split of excess return in favor of investors Leverage Maximum 50% of loan to values First tier cities include Beijing, Shanghai, Guangzhou and Shenzhen, Second tier cities are defined as fast growing provincial capitals and large coastal cities. For the purpose of this Overview, excludes Hong Kong SAR and Macau SAR. The Fund Manager reserves the right to accept lower amounts under different terms. The Fund may exceed 50% (but no more than 70%), subject to investor advisory committee approval, Investing in a growing economy China is one of the world's fastest growing economies. Rising incomes and improving living standards have rapidly helped create a substantial domestic consumer market, and a growing demand for modern housing. The supply of quality modern housing continues to lag demand in most cities. Long -term housing market fundamentals should support further capital growth and create relatively attractive investment opportunities in the residential sector. In the meantime, short -term financing difficulties faced by less established local developers are fostering a favorable environment for foreign sources of capital. Why China now? Since early 2009, residential sales have improved significantly. This has been supported by buyers returning to the market and further government policies and programs promoting the housing sector. Changes to both economic and monetary policy of the Chinese government have been fundamental in driving this pattern of growth. These policy changes have been designed to constrain investment/speculative demand, yet continue to support end -user demand, promoting urbanization, and maintaining a healthy, steadily growing housing market, particularly across first -tier cities. Investment opportunities for development in second and third -tier cities where the land and housing prices have not increased to the level of first -tier cities have also seen a marked increase. The Fund's competitive advantage The UBS / Gemdale China Real Estate Fund I (the Fund) draws upon the global investment management expertise of UBS Global Asset Management, and the local investment and development skills of Gemdale Corporation (Gemdale). The Fund seeks to offer investors the following advantages: • Right of first offer — on all opportunities sourced by Gemdale • Alignment of interest— both UBS and Gemdale have each committed USD 10 million to the Fund and the Fund intends to invest alongside Gemdale in each qualifying investment • Bridging finance provided by Gemdale — up to CNY 500 million • Exit option — option granted by Gemdale to the Fund to facilitate repatriation of capital UBS / Gemdale China Real Estate Fund I Why invest in the Fund? • Solid immediate and long -term economic and demographic growth • Strong demand for better quality housing • High return potential • Tax efficient structure • UBS fund management expertise • Gemdale investment and development expertise and outstanding track record Why UBS Global Asset Management? UBS Global Asset Management, a business division of UBS, is one of the world's leading asset managers. The division is also one of the largest mutual fund managers in Europe and the largest in Switzerland. UBS Global Asset Management has independence in investment decision making and operates as a self contained and focused asset management firm. For more information please contact Overview UBS Global Asset Management's Global Real Estate business actively manages investments in Asia, Europe and the US and across all major sectors. Our capabilities include core, value -added and opportunistic strategies on a global, regional and country basis These are offered through open and closed -end private funds, fund of funds, individually managed accounts and publicly traded real estate securities globally. Why Gemdale? Founded in 1988, Gemdale has been listed on the Shanghai Stock Exchange since April 2001. For six years running Gemdale has been ranked "China Top 10 Real Estate Listed Companies in Overall Strength" by the China Real Estate Top 10 Research Group. Gemdale is a state - level A -rated real estate developer and enjoys a strong track record. The company is well established in 16 major cities throughout China. Global Americas Switzerland Global Head of Business Development Thomas Anathan Dominic von Felten Andreas Mondovits Tel. +1- 860 -616 9128 Tel. +41 -44 -234 60 21 Tel. +41 -44 -234 26 49 thomas.anathan@ubs.com dominic.von- felten@ubs.com andreas.mondovits@ubs.com UBS Global Asset Management (UK) Ltd Continental Europe Germany & Austria 21 Lombard Street Roberto Varandas Tilman Hickl London EC3V 9AH Tel. +44 -20 -7901 5060 Tel. +49 -89 -206 095 120 Tel. +44 -20 -7901 5000 roberto.varandas@ubs.com tilman.hickl@ubs.com Fax +44 -20 -7901 5528 This document is intended for limited distribution to professional clientsfinstitutional investors and associates of UBS Global Asset Management. It is not to be distributed to or relied upon by Retail Clients under any circumstances. Using, copying, reproducing, redistributing or republishing any part of this publication without the written permission of UBS Global Asset Management is prohibited. The recipient agrees that this information shall remain strictly confidential where it relates to the Investment Manager's business. The prior consent of UBS Global Asset Management should be obtained prior to the disclosure of commercially sensitive information to a third party (excluding the professional advisors of the recipient). The information and opinions contained in this document have been compiled or arrived at based upon information obtained from sources believed to be reliable and are a reflection of UBS Global Asset Management's best judgment at the time this report is compiled, No responsibility is accepted for any errors or omissions and all such information and opinions are subject to change without notice; we are under no obligation to update or alter forward- looking statements or opinions as a result of new information. A number of the comments in this document, including statements about performance objectives, risk and /or return targets, are considered forward - looking statements. Actual future results, however, may vary materially. Please note that past performance is not a guide to the future. It should not be assumed that any of the securities transactions or holdings referred to herein were or will prove to be profitable, or that the investment recommendations or decisions we make in the future will be profitable or will equal the performance of the investments referred to in this document, This document is a marketing communication, Any market or investment views expressed are not intended to be investment research. This document is for distribution only under such circumstances as may be permitted by applicable law. It was written without reference to any specific or future investment objective, financial or tax situation or requirement on the part of a particular individual or group, This information is not intended to provide, and should not be relied upon for, accounting, legal or tax advice, or investment recommendations. You should consult your tax, legal, accounting or other specialist advisors as to the legal and tax implications of investing. UBS Global Asset Management, its related companies, or its clients may, from time to time, invest in or divest of interests in the funds referred to in this material. The investment strategies mentioned in this document mayor may not be in existence yet. Accordingly, the terms outlined in this document may vary when the investment strategies have been finalized. This document does not create any legal or contractual obligation with UBS Global Asset Management, nor does it constitute an offer to sell or a solicitation to offer to buy any securities and nothing in this shall limit or restrict the particular terms of any specific offering, Offers will be made only to qualified investors by means of a prospectus or confidential private placement memorandum providing information as to the specifics of the offering. The prospectus or confidential private placement memorandum should be examined fully before investing in the offering. No offer of any interest in any product will be made in any jurisdiction in which the offer, solicitation or sale is not permitted, or to any person to whom it is unlawful to make such offer, solicitation or sale With investment in real estate (via direct investment, closed- or open-end funds), the underlying assets are very illiquid. In certain circumstances, repatriations might be delayed if an investment is not readily saleable and there is insufficient cash within the portfolio. Source for all datalcharts, if not stated otherwise. UBS Global Asset Management. Additional disclaimers for: AU investors — UBS Global Asset Management (Australia) Ltd (ABN 31 003 146 290, AFS Licence No 222605) CA Investors — UBS Global Asset Management (Canada) Inc is a subsidiary of UBS AG. UBS Global Asset Management (Canada) Inc. is a registered ICPM in all provinces and territories of Canada and is a memberof the UBS Global Asset Management business division, Investment opportunities presented in this document may not be available to all Canadian investors, The use of forward- looking information or any disclaimers surrounding forward- looking information in this document was not made in accordance with any applicable Canadian legislation relating to such information. This document is distributed by UBS Global Asset Management (Canada) Inc. CEMEA investors — This document has been issued by UBS AG, a company registered under the Laws of Switzerland. SG investors — This document is solely for information and discussion purposes only and only intended for institutional investors as defined in section 4A of the Securities and Futures Act (Cap. 289) of Singapore. This document is not intended as an offer, or a solicitation of an offer, to buy or sell any investments or other specific product, and has not been recognised by the Monetary Authority of Singapore under the Securities and Futures Act (Cap, 289) for sale in Singapore, UK investors —This document is for Professional Clients only It is not to be distributed to or relied upon by Retail Clients under any circumstances. The document has not been prepared in line with the FSA requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research. The value of investments and the income from them may go down as well as up, and investors may not get back the original amount invested. Information reasonably deemed to be commercially sensitive and obtained from UBS Global Asset Management (UK) Ltd should not be disclosed. This information is supplied with a reasonable expectation that it will not be made public. If you receive a request under the Freedom of Information Act 2000 for information obtained from UBS Global Asset Management (UK) Ltd we ask that you consult with us. We also request that any information obtained from UBS Global Asset Management (UK) Ltd in your possession is destroyed as soon as it is no longer required. UBS Global Asset Management (UK) Ltd is a subsidiary of UBS AG. Registered in England and authorised and regulated by the Financial Services Authority. UBS Global Asset Management (UK) Ltd, UBS Global Asset Management Funds Ltd, UBS Global Asset Management Life Ltd, Telephone calls may be recorded. US investors —UBS Realty Investors LLC is a subsidiary of UBS AG. It is a registered investment adviser and member of the UBS Global Asset Management business division. Securities are distributed to US investors through UBS Fund Services (USA) LLC, member FINRA/ SIPC, main office 242 Trumbull Street, Hartford, CT 06103. Some investment opportunities presented in this document may not be available to US investors. All information as at 31 March 2010 unless stated otherwise. Published April 28, 2010. Approved for AU, CA, CEMEA(excEA, CH, HK, SG, UK, US-1 0 UBS 2010 , The key symbol and UBS are among the registered and unregistered trademarks of UBS, All rights reserved, Contact information UBS Fund Services (USA) LLC, member FINRA / S1 PC, and its affiliates act as the non - exclusive distributor of commingled fund securities. Ronald L. Lanier Client and Portfolio Services UBS Realty Investors LLC 242 Trumbull Street Hartford, CT 06103 -1212 ronald.Ianier @ubs.com Tel. +1-860-6169080 Fax: +1-860-6169104 www.ubs.com/realestate Together, UBS Realty Investors LLC, UBS AgriVest LLC, and UBS Fund Services (USA) LLC, subsidiaries of UBS AG, comprise Global Real Estate — US. Securities offered through UBS Fund Services (USA) LLC, member FINRA /SIPC. Ronald Lanier, registered representative. Date: October 30, 2009 T T�7 S IMan al Asset LJ 1! �] Management US-1 86