compressed_May 22 2018 Presentation - President's Address

May 22, 2018

AGENDAAnnual Business Meeting• Club Business• Financial Summary• Membership Report• Committee updates• President’s AddressProject Update• Introduce Partners• Design• Member Dues• Interim Club Space

Club Business• Call to order The 2018 Annual Meeting of Members• Approve minutes from 2017 Annual Meeting• Introduction of Board Officers and Committee ChairsCommittee Chairs 2017/2018 Executive CommitteeFinance: David MesickHouse: Jack Quinlevan President: David KrieteSocial: Laura Rizzo / Josh Janis Vice President: Jack QuinlevanHuman Resources: Past President: Dan CooperMembership: Drew Hunn Treasurer: Dave MesickAthletic: Eric Maher Secretary: Jeanine SweenyWomen’s: Jeanine SweeneyNominating: TJ MolinariFood & Beverage: Laura Rizzo / Josh Janis INTRO

Club Business2018 Board of Directors Election Results • David Kriete & Drew Hunn reelected to new 3-year termsBylaws Amended in 2018 to right size board to 9 members • Currently 12 board members • Board will downsize via attrition through 2019 • Dan Cooper terms out in 2018 • Bill Patton did not run for reelection in 2018 • Jeanine Sweeney terms out in 2019 INTRO

Net Income 600,000 Net Income EBITDA 400,000 2016 2017 200,000 - (200,000) (400,000) (600,000) (800,000)(1,000,000)(1,200,000) 2015 2018 Fiscal Year 2015 2016 2017 2018 Revenue 6,782,050 6,370,012 5,947,958 5,409,578 Net Income (268,175) (586,409) (554,930) (1,068,036) EBITDA (530,204) 330,632 (30,409) (36,400) FINANCIAL SUMMARY

Operational Revenues$5,000,000.00$4,000,000.00$3,000,000.00$2,000,000.00$1,000,000.00$0.00 Food & Beverage Guest Rooms Revenue Other Departmental Rev. Membership and Other Total Revenue Revenue 2018 2017 Operational Revenues 2018 2017 Food & Beverage Revenue 2,070,169 2,061,812 1,157,771 Guest Rooms Revenue 954,863 925,510 Other Departmental Rev. 724,313 4,145,093 1,802,865 Total Department 3,749,346 5,947,958 Membership and Other 1,660,223 Total Revenue 5,409,569 FINANCIAL SUMMARY

We do not have an enrollment problem,we have an attrition problem. Members Added Member Resignation Total Members 1122015/2016 115 140 8882016/2017 1422017/2018 184 817 21YTD 2018 140 129 774 (843 was high)15 Year Average 25 770 173 (average net loss of 30 each year)#1 reason for resignation are things the project will fix. Facility quality, service, age ofequipment, tired facilities, equipment reliability, building environmental (too hot, too cold, etc) MEMBERSHIP

It’s All About Membership• Total Dues Paying Members: 774 • Proven we can enroll new Members with our current product • Solution: Stop Attrition • Elevate and enhance facilities, amenities & programming • Interim Club space during construction – Keeping the Club connections alive • Incentives to stay and join early• Goal prior to building closure: 850 Members• Goal for pre-sell during construction: 1000 members• Goal 24 months after re-opening: 1500 members MEMBERSHIP

Membership is Crucial – We are building it for you!• Our current Membership of 774 can support exclusive Member space for athletics, multiple/seasonal food & beverage outlets, and social lounge areas. • Preliminary developer designs are for a Club with 1500 active Members • Flexible spaces can be converted for a Club with 2400 active Members• Every MAC Member (pre-construction) allows developer to finance $55,000 for investment in Member exclusive spaces• There has never been a more valuable time to stay a Member of the MAC MEMBERSHIP

President’s AddressDavid Kriete Strategic Vision The MAC is the finest and most exclusive social and athletic Club, providing all ages of professionals the opportunity to network, connect business life with family/social life, enjoy access to select clubs and functions, all while building a healthy lifestyle in a state-of-the-art fitness center

President’s Address Critical issues facing the club which need to be addressed Member Experience erosion over last decade Significant Capital Investments neglect Financial Operation continues to decline CRITICAL ISSUES

Desired OutcomesCriteria applied by MAC Board when vetting solutions:1. Must enhance the MAC’s legacy – as an entity and for Members2. Must offer short/long-term operating financial stability3. Must offer ability to infuse major and immediate investment in to Club4. We, the Members, must maintain ‘control’ of the Club5. Succession provisions to ensure the Club survives beyond any partnership agreement CRITERIA

Thorough Discovery Extensive due diligence to benchmark the best City Clubs, Athletic Facilities, etc • Focus groups • Member survey data • Rounds of meetings and research • Traveling to other clubs • Industry trends and experts • Vetting service and solution providers DISCOVERY

What MAC Members Want (survey results) - ExperienceQuality Facilities & Amenities Professional Staff ✓ Proud to bring others to your Club ✓ Greeted by name with a trained staff ✓ Expanded concierge services ✓ Consistent Member and Customer Service throughout ✓ More members, more opportunities ✓ Qualified and trained professionals ✓ Anticipate Member/Guest Needs to network ✓ The little things to improve my experience ✓ Strong and proud reflection of ✓ Professional, friendly and courteous staff ✓ Attentive and willing to help your business and brand ✓ Make my guest and I feel special ✓ Every detail considered ✓ Balancing historic preservation with updated finishes and technology WHAT MEMBERS WANT

What MAC Members Want (survey results) – Programing & UseAthletics Food, Beverage & Social ✓ Choosing a healthy lifestyle ✓ Elevated food and drink in a variety of new settings ✓ Strength & conditioning spaces throughout the building (same spaces, new settings) ✓ Group fitness with great instructors ✓ Multiple offerings of grab and go, sit down service (spin room, 30% more, on-demand) ✓ Great rooftop spaces, social lounges and ✓ Basketball ✓ Expanded co-ed offerings social athletic spaces ✓ Womens’ only athletic spaces ✓ Quiet areas for collaboration or working remotely ✓ Swimming ✓ Mingle with another member or take advantage ✓ Steam & sauna of group leagues/events ✓ Memorable events only accessible at the MAC WHAT MEMBERS WANT

This is how we are going to do it.

Why we selected Josh & Tony • Vetted against multiple developers • Developer’s vision accomplishes all criteria set forth by board • Use of historic tax credits • Access to capital • Shared vision of the MAC’s future • Vested interest in saving the ClubJosh Jeffers Tony Janowiec PROJECT UPDATE

Century Plaza Grand Avenue Redevelopment minneapolis milwaukeeThrivent Financial 333 N. Waterminneapolis milwaukee

The Grain Exchange Historic GarfieldThe Mackie Building The Mitchell Building

Why Kahler Slater was the best fit • Relevant historic experience • Experience with athletic facilities • Relevant hospitality experience for hotel • Right size team • Passion for the project



Why Sage was the obvious choiceSAGE HAS A UNIQUE ABILITY TO TRANSFORM ORDINARY HOTELS & • Leading full service hotel operatorRESTAURANTS FROM PLACES INTO DESTINATIONS: • Dedicated team for F&B▪ They are places people want to go to; more than just a hotel but an experience. concept development – Best in the business▪ They are genuine, indigenous and in no way contrived. • Independent hotel brand • Equity investor in the hotel project▪ They celebrate and feature the local attributes of the city and the neighborhood.The Crawford Hotel Hotel Commonwealth Union Station Hotel, Autograph The Nines,Denver, CO Boston, MA Collection Luxury Collection Nashville, TN Portland, ORThe Maven at Dairy Block The Logan Philadelphia, Curio Blackstone Chicago, Autograph Hotel HalcyonDenver, CO Collection by Hilton Collection Cherry Creek- Denver, CO Philadelphia, PA Chicago, IL

Why Strategic Club Solutions was the best choiceExperience • Full-service club managementManagement and consulting firmAccountability • Local team based in Milwaukee • Active with the MAC since July 2016 • Aligned with MAC vision and goals • Experienced & Proven Partner • Club Management Experience • Nationally Recognized in the Private Club Industry CLUB MANAGEMENT PARTNER

Chartwell Golf & Country Club, MD The Old Club, Island Resort & Yacht Club, MI Woman’s Athletic Club of Chicago Milwaukee Athletic Club, WI The Cumberland Club, ME CLUB MANAGEMENT PARTNER

INTRODUCTION OF THEDEVELOPMENT TEAM PROJECT UPDATE

Exciting News from the Developer • Desire to take on this project • Vision of the MAC’s future • Historic Tax Credit Update • GC/CM Selected PROJECT UPDATE

B&A OVERVIEW ▪ Founded in 1891 ▪ Family-owned, operated ▪ Self-Performance ▪ Safety EMR: .63 ▪ D&B Rating: 4A2 ▪ BAMR: Masonry Restoration & ▪ BACR: Concrete Restoration

REPRESENTATIVECLIENTS





SAGE’S 30 YEARS OF EXTRAORDINARY HISTORY1984 EARLY 2000s TODAYWalter Isenberg & Zack Neumeyer found Sage Full service upscale acquisitions ▪ 34 years of managing and developing 400+ hotels andHospitality and management world-class restaurantsEARLY 1990s 2006 ▪ Currently managing 64 hotels and 15 destination restaurants in100+ Fairfield Inns and first acquisition of The Sage Restaurant Group formed 20 statesOxford Hotel 2015 ▪ 13,467 hotel rooms1996 ▪ Over 400,000 square feet of Sage takes over the Ritz Carlton Chicago,First historical renovation of Courtyard by becoming the first, and only, 3rd party Ritz meeting spaceMarriott Denver Downtown Carlton operator. ▪ 130 corporate associates ▪ 6,000+ total associates ▪ Two hotels under development ▪ Managing eleven Sage Restaurant Group brands ▪ Almost $1B in revenues projected for 2018

BRANDS IN PORTFOLIO MARRIOTT HILTON INDEPENDENT & SOFT BRANDED

IDENTITY CREATIONSAGE HAS A UNIQUE ABILITY TO TRANSFORM ORDINARY HOTELS &RESTAURANTS FROM PLACES INTO DESTINATIONS:▪ They are places people want to go to; more than just a hotel but an experience.▪ They are genuine, indigenous and in no way contrived.▪ They celebrate and feature the local attributes of the city and the neighborhood.The Crawford Hotel Hotel Commonwealth Union Station Hotel, Autograph The Nines,Denver, CO Boston, MA Collection Luxury Collection Nashville, TN Portland, ORThe Maven at Dairy Block The Logan Philadelphia, Curio Blackstone Chicago, Autograph Hotel HalcyonDenver, CO Collection by Hilton Collection Cherry Creek- Denver, CO Philadelphia, PA Chicago, IL

Departure Urban Farmer The Emporium Kachina The OriginalPortland, OR Portland, OR Kitchen & Wine Market Westminster, CO Portland, ORDenver, CO Cleveland, OH Fort Collins, CO Denver, CO Philadelphia, PA Savannah, GA SAGE RESTAURANT Hello Betty Denver, CO GROUP LOCATIONS Oceanside, CA The Corner Office Pint Brothers Alehouse Mercat a la planxa Denver, CO Denver, CO *O t h e r C r e a t e d a n dBowerbird Coffee Chicago, IL Managed Brands:Fort Collins, CO Magic Rat Live MusicSavannah, GA Poka Lola Social Club Fort Collins, CO Assembly, Philadelphia Denver, CO Commons, Philadelphia Peregrin Lounge, Savannah Sunset Lounge, Fort Collins The Cruise Room, Denver The Wayward, Savannah B&GC Denver, CO





DESIGN

AERIAL | EXISTING BUILDING

FLOOR XX PRECEDENT IMAGE• PROGRAM PRECEDENT IMAGE• PROGRAM PRECEDENT IMAGE• PROGRAM• PROGRAM STACKING DIAGRAM

FLOOR XX PRECEDENT IMAGE• PROGRAM PRECEDENT IMAGE• PROGRAM PRECEDENT IMAGE• PROGRAM• PROGRAM STACKING DIAGRAM

ELIZABETH HOTEL | FORT COLLINS INSPIRATION | ENTRY LOBBY

OXFORD HOTEL | DENVER INSPIRATION | ENTRY LOBBY

MAVEN HOTEL | DAIRY BLOCK DENVER INSPIRATION | ENTRY LOBBY

EMPORIUM| FORT COLLINS INSPIRATION | RESTAURANT

EMPORIUM| FORT COLLINS INSPIRATION | RESTAURANT

EMPORIUM| FORT COLLINS INSPIRATION | RESTAURANT

EMPORIUM| FORT COLLINS INSPIRATION | RESTAURANT

EMPORIUM| FORT COLLINS INSPIRATION | RESTAURANT

FARMER’S DAUGHTER | PHILADEPHIA INSPIRATION | BOUTIQUE RETAIL

SALON V | NEW YORK CITY INSPIRATION | BOUTIQUE RETAIL