Letter from our President-January 11, 2012

To our M1 family members,

MONOPOLY I, LLC (M1) had a very challenging but productive year in 2011. Despite a year of great stock market volatility, continued housing market gloom, and the most powerful tornado that Joplin has ever experienced, M1 invested significant capital in renovations, grew its securities portfolio, and reduced debt and interest expense which positions the company for a standout year in 2012.

As we finish our sixth calendar year in business, it is with great satisfaction that I can announce the following goal accomplishments:

- Assets are currently valued at $3,425,999 vs. our goal of $2,750,000
- Liabilities are $1,709,901 or 50% of assets vs. goal of $2,398,199 or 70% of assets
- 2011 Revenue was $241,175 vs. goal of $235,000
- M1 invested over $109,000 in property renovations plus $251,000 in tornado repairs paid for with insurance proceeds during 2011
- M1 grew its securities portfolio $121,099 to $363,199 as of December 31, 2011

We have utilized a moderate amount of leverage to effectively deploy our capital, but have also utilized a prudent portfolio management approach by minimizing exposure to one particular holding or sub-asset class. Building upon our notion of diversification, our focus in 2012 will be to expand our securities portfolio, adding to all sectors of the real estate market.

In terms of highlights for 2011, I’d like to call your attention to a few specific trends:

-Quarterly rental income is on a positive trend. During 2011 our quarter rental revenue was: 1Q: $53,542, 2Q: $42,756, 3Q: $52,472, and 4Q: $69,190. You can see the effect the May tornado had on our rental income during 2Q, and how the company has recovered from this disaster as well as the positive impact during 3Q and 4Q following our completed apartment renovations.

-Quarterly interest expense is on a positive trend. Our management team continues to refinance our debt and lower our average cost of capital resulting in lower interest expense. During 2011 our interest expense was: 1Q: $31,946, 2Q: $26,602, 3Q: $24,260, 4Q: $25,066.

-Financial leverage has been reduced which positions our company well for future financing opportunities with lower interest rates. At the end of 2011 our financial leverage was 50%, a 5% reduction YOY.
 
-Securities portfolio growth is in line with our goal and it will provide dividends beginning in the second half of 2012—with our first dividend payment to be paid on January 31, 2013. During 2011 our quarterly dividends received from our securities portfolio was: 1Q: $2,305, 2Q: $2,663, 3Q: $3,403, 4Q: $4,358.

In summary, as we look to 2012, I am very optimistic about the continuing prospects and opportunities for MONOPOLY. Despite glimmers of an economic recovery, there remains much pessimism in the real estate market. As real estate prices try and find a bottom, M1 will continue to identify assets that offer an outsized risk-return trade-off and a higher yielding return in a low interest rate environment. Additionally, M1 has 14 remaining apartments that need extensive renovation. These renovations will be completed in 2012 with an estimated cost of $75,000 and an expected completion date of June 30, 2012. With our share members’ continued capital investments we will be able to accomplish our scheduled renovations. This effort will complete our property renovations and position us perfectly as we begin the dividend paying phase of our company’s life cycle on July 1, 2012. If you would like a more detailed conversation, I would be more than happy to discuss and share our unique investment opportunity and our established track record exhibiting minimal downside exposure.

God bless,

BILL