CHIQUITA APARTMENTS 300 CHIQUITA AVENUE,MOUNTAIN V IEW - 12 APARTMENT U NITS

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1 I N V E S T M E N T O P P O R T U N I T Y 300 CHIQUITA AVENUE,MOUNTAIN V IEW - 12 APARTMENT U NITS Exclusively Listed By Keith Suddjian Senior Vice President Lic# ksuddjian@ccareynkf.com CORNISH & CAREY COMMERCIAL NEWMARK KNIGHT FRANK 245 Lytton Avenue, Suite 150 Palo Alto, California Fax

2 I M P O R T A N T I N F O R M A T I O N The information contained herein has either been given to us by the owner of the property or obtained from sources that we deem reliable.we have no reason to doubt its accuracy, but we do not guarantee it. THE VALUE OF THIS INVESTMENT IS DEPENDENT UPON FEDERAL AND STATE TAX LAWS, AS WELL AS THE INVESTMENT INCOME, THE TAX BRACKET AND OTHER FACTORS, WHICH YOUR TAX ADVISOR AND LEGAL COUNSEL SHOULD EVALUATE. THE PROSPECTIVE BUYER SHOULD CAREFULLY VERIFY EACH ITEM OF INCOME, EXPENSE AND ALL OTHER INFORMATION CONTAINED HEREIN. Buyer should measure all units and lot prior to purchase and should NOT rely on square footage figures in this package. Listing agent, broker and owner have not measured the units or lot. PLEASE DO NOT DISTURB RESIDENTS. A TOUR OF THE PROPERTY CAN BE ARRANGED THROUGH LISTING AGENT ONLY.

3 O F F E R I N G S U M M A R Y Address 300 Chiquita Avenue,, California Price $1,875,000 # of Units 12 Price per Unit $156,250 Gross Annual Scheduled Income (Current) $162,852 Gross Income Multiplier (Current) Capitalization Rate (Current) 4.70% Zoning R3-2 per City of Assessor s Parcel Number Year Built (RealQuest) 1905 Lot Size (RealQuest Parcel Map) ±27,736 sq. ft. Price/Square Foot of Land ±$67.60 UNIT MIX/SCHEDULED INCOME # of Units Unit Type Current Rent 2 Studio x 1 $845 - $ x1 $930 - $1,325 1 Garage $ (Apartment Units) $13,370 See Offering Summary Footnotes and Disclaimers at End of this Offering Memorandum

4 P R O P E R T Y O V E R V I E W PROPERTY DESCRIPTION The Chiquita Apartments has 12 rental units located on a very large parcel of land in a desirable location.the improvements consist of a charming Victorian style two-story main house divided into 6 residential rental units, all unique in their own way, and 6 cottages spread out throughout the property.the unit mix in the main house is two Studio/1 Bath units and four 1Bedroom/1 Bath units. Five of the six cottages are single story. The sixth cottage is located on the second floor above a 3-car garage.all six of the cottages are 1 Bedroom/1 Bath.There are 4 garage spaces at the property.three are in the garage located below apartment #13 and one garage space is attached to apartment #9.The large parcel of land may provide an owner with redevelopment possibilities.this desirable location is conveniently located with easy access to: San Antonio Shopping Center (Sears,Walmart, etc.) Target Store and many retail establishments on El Camino Real Highways 101, 85 and All of which provide good access to major employment centers of the Silicon Valley Downtown and Public Library Rengstorff Park (Tennis Courts) Senior Center Eagle Park (Swimming Pool) Shoreline Business Park PROPERTY HIGHLIGHTS Very large lot - Could be redevelopment possibilities Cottages offer lower density living environment for residents to enjoy Ample off street parking Hardwood floors noted in some units Two story main house has a partial basement LAUNDRY FACILITIES Laundry room with 1 coin-operated washer and 1 coin-operated dryer.the laundry room equipment is leased from Fowler Route Company (Web). * Redevelopment possibilities, if any, should be determined by Buyer and is not guaranteed by Seller, Broker or Agent.

5 P R O P E R T Y O V E R V I E W HEATING 6 cottages (Apts. #9, 10, 11, 12, 13 and 14) have a gas wall furnace heating system Apartments #1, 3, 4, 5, 6 and 7 each have a gas heating system PARKING Total of approximately 23 parking spaces comprised of: - 4 garage spaces - ±19 uncovered spaces ROOF COVERINGS Pitched composition shingle roof on each of the buildings DOMESTIC HOT WATER SYSTEM Each of the six cottage units has an individual water heater Two-story main house has 2 water heaters UTILITIES 13 gas meters and 13 electric meters. Master metered for water. UTILITY PAYMENT RESPONSIBILITIES Garbage Common Area Electricity Common Area Gas Water Electricity within Unit Gas within Unit Unit Hot Water Laundry Hot Water Owner Owner Owner Owner Resident Resident Varies Owner PROPOSED FINANCING It is anticipated that a new, adjustable rate first loan will be available on the subject property.the amount of the loan is dependent upon the lender, loan program and buyer s qualifications. Fixed rate debt is also anticipated to be available. Please call the listing agent for more specific information regarding possible loan structures, lenders and loan terms.available loan amounts and terms are subject to change and are not guaranteed. See Property Overview Footnotes at End of this Offering Memorandum

6 O P E R A T I N G S T A T E M E N T INCOME Current Gross Scheduled Apartment Rents $158,340 Laundry Income 1,912 Garage Rent 2,100 Miscellaneous Income 500 Retained Deposit 1,310 Gross Scheduled Income 164,162 Less:Vacancy and Collection Loss (5.5% of Gross Scheduled Apartment Rents) $8,709 Effective Gross Income $155,453 EXPENSES:ADMINISTRATION Management Fee $7,669 Payroll 6,571 Payroll Tax Expense 764 Advertising & Promotions 114 Other Expenses 332 Office Expense 280 Total $15,730 EXPENSES:OPERATION Appliance Repairs $145 Supplies 1,383 Pest Control 1,176 Grounds Maintenance 3,671 Maintenance & Repairs 3,046 Janitorial 880 Painting 1,357 Gas & Electricity 2,112 Water 2,590 Sewer 3,396 Trash 3,107 Total $22,863 TAXES & INSURANCE Workers Compensation Ins. $165 Property Tax 22,309 Property Insurance 6,221 Total $28,695 TOTAL OPERATING EXPENSES $67,288 NET OPERATING INCOME $88,165 Operating Expenses as a percentage (%) of Gross Scheduled Income 40.99% Operating Expenses per Unit $5,607 See Operating Statement Footnotes and Disclaimers at End of this Offering Memorandum

7 R E N T R O L L Unit # Type Current Rent Security Deposit Move-In (Approx.) Term 1 Studio x 1 $915 $450 6/1/02 Month to Month 3 1x1 $1,150 $1,150 4/10/09 Month to Month 4 1x1 $1,195 $500 7/14/07 Month to Month 5 1x1 $1,050 $500 12/1/09 Month to Month 6 1x1 $930 $500 7/1/03 Month to Month 7 Studio x 1 $845 $500 10/11/03 Month to Month 9 1x1 Cottage $1,250 $800 6/8/00 Month to Month 10 1x1 Lg. Cottage $1,325 $750 4/11/99 Month to Month 11 1x1 Cottage $1,140 $500 2/11/06 Month to Month 12 1x1 Cottage $1,050 $800 6/3/09 Month to Month 13 1x1 Above 3 - Car Garage $1,095 $500 7/1/09 Month to Month 14 1x1 Cottage $1,250 (Asking) $0 Vacant - 1-Car Garage $ Month to Month $13,370 $6,950 See Rent Roll Footnotes and Disclaimers at End of this Offering Memorandum

8 A E R I A L M A P SITE

9 A R E A M A P S SITE SITE

10 P A R C E L M A P

11 A P A R T M E N T S A L E C O M P A R A B L E S 98 CHURCH STREET # of Units: 6 Year Built: 1952 $990,000 $165,000 $ /25/09 4-1x1 2-2x1 776 PALO ALTO AVE. # of Units: 12 Year Built: 1958 $1,869,500 $155,792 $ /16/ x1 2-2x LATHAM STREET # of Units: 15 Year Built: 1963 $2,550,000 $170,000 $ /8/ Studio x 1 6-1x1 4-2x COLONY # of Units: 7 Year Built: 1965 Note: Lot Size ±17,925 SF $1,500,000 $214,286 $ /1/09 3-1x1 1-2x1 2-2x1½ TH 1-4x2 250 PALO ALTO AVE. # of Units: 6 Year Built: 1960 $1,180,000 $196,667 $ /21/09 2-1x1 4-2x1 MAGNOLIA APTS. 678 VICTOR WAY # of Units: 6 Year Built: 1950 $1,400,000 $233,333 $ /10/09 2-1x1 4-2x1

12 A P A R T M E N T S A L E C O M P A R A B L E S 690 VICTOR WAY # of Units: 6 Year Built: 1950 $1,400,000 $233,333 $ /10/09 2-1x1 4-2x1 LATHAM WEST 2295 LATHAM # of Units: 10 Year Built: 1963 $2,075,000 $207,500 $ /30/08 6-1x1 4-2x1 868 PARK DRIVE # of Units: 7 Year Built: 1954 $1,150,000 $164,286 $ /30/08 7-1x1 LYNWOOD GARDEN 510 WALKER # of Units: 12 Year Built: 1959 $2,237,635 $184,469 $ /16/08 5-1x1 6-2x1 1-2x1 TH 232 S. SHORELINE # of Units: 8 Year Built: 1956 $1,507,000 $188,375 $ /26/08 7-1x1 1-2x1

13 A P A R T M E N T S A L E C O M P A R A B L E S 585 ORTEGA # of Units: 12 Year Built: 1959 $1,618,750 $134,896 $ /25/ Studiox1 372 CAMILLE CT # of Units: 12 Year Built: 1953 $1,865,000 $155,417 $ /23/ x1 753 EHRHORN AVENUE # of Units: 10 Year Built: 1974 $1,975,000 $197,500 $ /21/08 8-1x1 2-2x1 LARKSPUR WOODS 1957 CALIFORNIA ST. # of Units: 24 Year Built: 1960 $5,335,000 $222,292 $ /20/ x1 6-2x CALIFORNIA # of Units: 23 Year Built: 1962 $3,895,000 $169,348 $ /1/ x1 6-2x1

14 C O M P A R A B L E L A N D S A L E S Address Sale Date Zoning Lot Size Price Price/SF 1880 California Street 10/12/09 R3-2 ±28,750 $1,999,000 $69.53 Existing Use at Time of Sale Calvary Church of 1950 Montecito 11/2/07 R3-2.2 ±80,586 $5,910,770 $ Apartment Units (Purchased for Apartment Use) Sierra Vista & 1968 Hackett Rich Ave. 9/28/07 R3-2.2 ±67,705 $4,800,000 $ Apartment Units 8/22/07 R3-1 ±31,363 $2,050,.000 $65.36 Raw Land 669 Chiquita 5/11/07 R3-2.5 ±13,500 $1,500,000 $ Units (Sold w/approvals for 3 SFR s) 712 Pettis 3/13/07 R3-2 ±18,070 $1,760,000 $ Apartment Units 2215 Rock Street 2260 Rock Street 1/31/07 R3-2.2 ±55,000 $4,000,000 $ /26/06 R3-2.2 ±39,640 $3,050,000 $ Apartment Units (Plans for 20-Units) 15 Apartment Units (Built 15 Townhouses) 680 Sylvan 8/25/06 R3-2 ±40,138 $3,517,500 $ Apartment Units 115 Evandale 3/22/06 R3-2 ±19,602 $2,000,000 $ Sold with Permits for 6 Townhomes 207 Evandale 1055 Boranda 1/31/06 R3-2 ±18,800 $1,350,000 $ Apartment Units 1/12/06 R3-1.5 ±26,659 $1,889,000 $ Older Units 290 Chiquita 1/5/06 R3-2 ±4,365 $500,000 $ House (Subsequently Built New Home) 1178 Bonita 12/21/05 R3-2 ±16,050 $1,625,000 $ SFR 2068 San Luis Ave Boranda 12/2/05 R3-2.2 ±18,190 $1,700,000 $ /17/04 R3-2 ±22,000 $1,600,000 $ Apartment Units (4 Town Homes Proposed)

15 O F F E R I N G S U M M A R Y/P R O P E R T Y O V E R V I E W/ O P E R A T I N G S T A T E M E N T F O O T N O T E S OFFERING SUMMARY FOOTNOTES Gross Annual Scheduled Income (Current) & the Gross Income Multiplier (Current) are based on current rents shown in the Rent Roll.These rent levels are current rent levels at the time this package was prepared and subject to change without notice. Assumed Apt. #14 rents for $1,250/month. Buyer should review most recent rent roll prior to purchase. Retained Deposits in 2009 of $1,310 was not reflected in the GSI or GIM calculations in the Offering Summary section. Capitalization Rate (Current) is based on rents, expenses, vacancy and collection loss figures shown in Operating Statement (Current) column. Year Built is from the data source RealQuest.The age they have reported has not been verified and is not guaranteed as accurate by Broker, Agent or Seller. Price/Square Foot of Land (Assumes ±27,736 SF) is based on square footage shown on RealQuest Parcel Map (County Records) PROPERTY OVERVIEW FOOTNOTES Utilities: Buyer should verify actual number of gas, electric and water meters at the property and verify who pays for each utility prior to purchase. Seller, Broker and Agent do not warrant accuracy of this information. OPERATING STATEMENT FOOTNOTES INCOME SECTION: Current column based on current rents shown in Rent Roll.These rent levels were current at the time this package was prepared and subject to change without notice. Assumed Apt. #14 rents for $1,250/month. Buyer should review most recent rent roll prior to purchase. Laundry Income: The owner entered into a new laundry lease approximately May 2009.The amount of laundry income shown may include a decorating allowance paid to the owner upon entering into the new laundry lease. Garage Rent: The owner currently rents the garage attached to apartment #9 cottage to resident of apartment #9 for $175/month.This amount reflects that rent over a 12 month period. Miscellaneous Income: In 2009, received $340 for late check charge, $160 other income and $1,310 deposit - forfeit (Operating Statement Footnotes continued on next page)

16 O P E R A T I N G S T A T E M E N T R E N T R O L L OPERATING STATEMENT FOOTNOTES (CONT.) EXPENSES SECTION: Operating Expense Assumptions: Used 2009 figures provided by the Owner, except for changes below: (a) Changed property taxes to reflect sale. Used actual 2009/10 rate of 1.147% plus 2009/10 tax year assessments of $ (b) Used 5.5% Vacancy and Collection Loss.Actual Vacancy and Collection Loss may vary from this level and are not guaranteed by Broker, Agent or Seller (c) The Operating Expenses shown do not include the following expenditures the owner invested in the property during 2009: - Carpet and Vinyl $931 - Other Capital Expenditures $10,150 - Tree Trimming $670 RENT ROLL FOOTNOTES Current Rent: Apartment #9 current rent is $1,425, this resident is paying $1,250/month for the apartment rent plus $175/month rent for the attached 1-car garage.the rent roll in this Offering Memorandum is subject to change without notice and Buyer should obtain updated information, review and verify all rental terms prior to purchase. Unit Numbers: The property consists of a total of 12 units, numbering as such that there is not an Apt. #2 or #8, but there are apartments #13 and #14. Rent levels, occupancy, deposit amounts and terms are subject to change without notice. Move-In dates are subject to change as units turnover. Buyer should confirm all rent levels, lease terms, move-in dates, amount of last rental adjustment and deposit amounts prior to purchase.the property has 4 garages: currently 1 is rented to resident in apartment #9; One is used by owner and 2 are not being used. Owner pays gas for apartment #9. DISCLAIMERS Building square footage, unit square footage and lot size are not guaranteed. Broker, Agent and Seller have not measured all units, lot or the buildng, and are making NO representation as to the accuracy of square footage figures. Buyer should measure all units, lot and the building prior to purchase and should not rely on any square footage amounts provided to them by Broker, Agent or Seller. Redevelopment possibilities, if any, should be determined by Buyer and is not guaranteed by Seller, Broker or Agent. When analyzing this property, Buyer should use income, vacancy & expense levels that will accurately reflect the manner in which it plans to operate the property. Broker,Agent & Seller are makng no represenations or warranties as to the level of income or expenses Buyer will incur at the property.