Real Estate Investment Strategies

Investment example: Controlling stake in a U.S. non- bank mortgage originator Target well-capitalized, non-bank mortgage companies that can take market share Asset type Location Initial closing date Deal size/peak equity Private equity investment National lender (headquarters: Mid-Atlantic) October 2014 (term loan) and September 2015 (equity) $130 million / $130 million Expected holding period 5 years Leverage Unlevered Underwritten IRR / multiple 22% / 2.5x • • Transaction summary Acquired a controlling interest in a non-bank mortgage-banking company with $325 million of monthly production Term loan provided to company to fund part of purchase price in addition to growth capital and was later converted to equity • Finalized the purchase price in 2014 and negotiated • that all interim earnings would be retained by the company with no adjustment for the seller Sourced through a long-term relationship with an industry advisor • Investment thesis Tightening regulatory conditions have created an opportunity for strong, well-capitalized, non-bank mortgage companies to take market share • The company operates within a less competitive niche of the market enabling it to generate higher margins • With additional capital, the company can expand into other profitable loan products and leverage fixed cost to further boost profitability . • • . Status update Closed the equity investment in September 2015 and Company completed the purchase of an internet based direct-to-consumer mortgage originator in Q2 2016. Successfully completed integration in Q3 and have begun to hire and scale platform in 2017 For 2016, origination volumes increased by more than 60%, YOY, in 2016, and pretax profit expected to be up 15-20% Build-out of platform infrastructure and risk management systems substantially completed While volume growth and operating results are expected to decline during the first half of 2017 in response to the Q4 2016 increase in interest rates, FGMC expects second half volume and profit to recover with the growth from the internet direct-to-consumer lender and expansion of its wholesale lending channel As of 31 December 2016. SOURCE: PIMCO. Sample investment for illustrative purposes only. IRR represents the annualized internal rate of return for a specified period, based on capital contributed, expected distributions received and the residual value of unrealized investments. Multiple represents the ratio of (i) expected distributions received plus the residual value of unrealized investments to (ii) capital contributed. IRRS and multiples are net of deal-related expenses and gross of fund expenses. IRRs and multiples reflect PIMCO's views at the time of investment, and may no longer be accurate or reflect PIMCO's current views. Expected holding period and deal size / peak equity are subject to change. Underwritten IRR / multiple as of initial closing date. Current estimates of future returns may differ materially from the Underwritten IRR. Note: investment owned by BRAVO II; BRAVO III does not own such an investment Past performance is not a guarantee or reliable indicator of future results. There can be no guarantee that the expectations identified will be met. The case study discussed herein has been selected as a representative example of the types of transactions that are intended to be pursued by BRAVO III and has not been selected based on performance. Refer to Appendix for additional investment strategy and risk information PIMCO 11

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