SUMMARY APPRAISAL REPORT

SUMMARY APPRAISAL REPORT A PERMANENT UTILITY EASEMENT AND A TEMPORARY CONSTRUCTION EASEMENT OVER MULTI-FAMILY LAND LOCATED AT 928 CARLOS STREET FORT WALTON BEACH, FLORIDA 32547 AS OF JANUARY 31, 2012 MF12SB6789 PREPARED FOR HATCH MOTT MACDONALD C/O CITY OF FORT WALTON BEACH AND OKALOOSA COUNTY 5111 NORTH 12 TH AVENUE PENSACOLA, FLORIDA 32504 BY BRANTLEY & ASSOCIATES REAL ESTATE APPRAISAL CORPORATION 100 NORTH SPRING STREET POST OFFICE 12505 PENSACOLA, FLORIDA 32591-2505 PHONE: (850) 433-5075 FAX: (850) 438-0617 EMAIL: shawnbrantley@brantleyassociates.com R. SHAWN BRANTLEY, MAI Individual Member

BRANTLEY & ASSOCIATES REAL ESTATE APPRAISAL CORPORATION R. SHAWN BRANTLEY, MAI, CCIM FL: CERT GEN RZ289 AL: CERTIFIED GENERAL REAL PROPERTY APPRAISER, G00419 BARBARA M. MARTIN, MAI FL: CERT GEN RZ2552 BRUCE A. BLACK FL: CERT GEN RZ2714 Mr. Jason Garz Hatch Mott MacDonald 5111 North 12 th Avenue Pensacola, Florida 32504 Dear Mr. Garz: BARBARA S. BRANTLEY, CPA ADMINISTRATION & FINANCE DAVI D C. SINGLETON, MB A FL: TRAINEE RI23431 AL: CERTIFIED GENERAL REAL PROPERTY APPRAISER, G01003 Feb. 2, 2012 TORRI L. MATHERNE FL: CERT GEN RZ2987 MICHAEL MIRAGLIOTTA FL: CERT GEN RZ2173 Re: Appraisal of a 16,781 SF permanent subterraneous sewer easement and an 8,570 temporary surface construction easement, both over a 14.25 acre parent tract that is presently used as a trailer park at 928 Carlos Street in Ft. Walton Beach, 32541, Okaloosa County, Florida. B&A File #MF12SB6789. As you have requested, we have appraised the market value of the above referenced property. As a part of the appraisal process, we have made an inspection of the property and a careful analysis of those factors concerning the valuation of the property. Our perspective upon market value is retrospective. By reason of our inspection and analysis, which is described in the accompanying summary report, we recommend the following compensation for the subject property as of January 31, 2012 as follows: Acquisition Owner Acquisition Value Permanent Sewer Easement Capri Commons, LLC $161,000 Temporary Construction Easement Capri Commons, LLC $ 5,800 The above value estimates are subject to the limiting conditions and general assumptions contained in this appraisal plus the following extraordinary assumptions and/or hypothetical conditions. 1. The appraisal is made of the land only because the principal improvements are not affected by the acquisition. 2. The property rights acquired are considered by the appraiser based upon descriptions provided by the engineers and the appraiser has evaluated the acquisition on this basis. The appraiser is not an attorney and assumes no responsibility for preparation of the legal easement documents necessary to properly convey these rights. R. SHAWN BRANTLEY, MAI 100 NORTH SPRING STREET POST OFFICE BOX 12505 PENSACOLA, FLORIDA 32591 PHONE (850) 433-5075 FAX (850) 438-0617 EMAIL: shawnbrantley@brantleyassociates.com

Mr. Garz Feb. 2, 2012 This appraisal has been made in compliance with the Uniform Standards of Professional Appraisal Practice (USPAP) and with the Code of Professional Ethics of the Appraisal Institute. This appraisal assignment was not made, nor was the appraisal rendered on the basis of a requested minimum valuation, specific valuation, or an amount that would result in the approval of a loan. This is a Summary Appraisal Report, which is intended to comply with the reporting requirements set forth under Standards Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice for a Summary Appraisal Report. As such, it presents only summary discussions of the data, reasoning, and analyses that were used in the appraisal process to develop the appraiser's opinion of value. Supporting documentation concerning the data, reasoning, and analyses is retained in the appraiser's file. The depth of discussion contained in this report is specific to the needs of the client and for the intended use stated herein. The appraiser is not responsible for unauthorized use of this report. We appreciate the opportunity of doing this work for you, and if there should be any questions, please do not hesitate to call. Sincerely, BRANTLEY & ASSOCIATES REAL ESTATE APPRAISAL CORP. R. Shawn Brantley, MAI, CCIM State-Certified General Appraiser Florida # RZ289

TABLE OF CONTENTS TITLE PAGE... LETTER OF TRANSMITTAL... TABLE OF CONTENTS... 4 SUMMARY OF SALIENT FACTS AND CONCLUSIONS... 6 EXHIBITS & PHOTOGRAPHS... 7 LEGAL DESCRIPTION... 22 PURPOSE OF THE APPRAISAL... 22 FUNCTION AND INTENDED USER OF APPRAISAL... 22 APPRAISAL METHODOLOGY... 23 SCOPE AND EXTENT OF DATA COLLECTION AND ANALYSIS... 23 APPRAISAL PROBLEM... 24 DEFINITION OF MARKET VALUE... 25 EXPOSURE TIME... 26 MARKETING PERIOD... 26 PROPERTY RIGHTS TO BE APPRAISED... 26 ZONING, FUTURE LAND USE, CONCURRENCY... 27 ASSESSMENT & TAXES... 29 HISTORY OF PROPERTY... 29 GENERAL AREA DATA... 30 NEIGHBORHOOD DATA... 30 DESCRIPTION OF THE PARENT TRACT... 32 HIGHEST AND BEST USE... 33 APPROACHES TO ESTIMATING VALUE... 35 PARENT TRACT LAND VALUATION... 35 LAND VALUE ESTIMATE BEFORE... 55 DESCRIPTION OF THE PART ACQUIRED... 56 VALUATION OF THE PART ACQUIRED... 57 VALUE OF REMAINDER AS A PART OF THE WHOLE PROPERTY... 59 PURPOSE OF APPRAISAL OF REMAINDER AFTER THE ACQUISITION... 60 APPRAISAL PROBLEM... 60 DESCRIPTION OF REMAINDER... 60 ZONING, FUTURE LAND USE, CONCURRENCY... 61 EFFECT OF ACQUISITION ON REMAINDER... 62 HIGHEST AND BEST USE... 62 APPROACHES TO VALUE USED AND EXCLUDED... 63 LAND VALUATION FOR REMAINDER... 63 SUPPORT FOR DAMAGES/NO DAMAGES TO THE REMAINDER... 65 COST-TO-CURE... 65 SPECIAL BENEFITS... 66 SUMMARY OF VALUES AND SUMMARY OF TOTAL COMPENSATION... 66 APPRAISAL OF TEMPORARY CONSTRUCTION EASEMENT... 67 SUMARY OF COMPENSATION FOR TCE... 69 ASSUMPTIONS AND LIMITING CONDITIONS... 70 CERTIFICATION... 71 QUALIFICATIONS OF APPRAISERS... 72 ADDENDA... 75 GENERAL AREA ANALYSIS... 76 COMPARABLE LAND LEASES... 87 SUBJECT PROPERTY DATA... 98 COUNTY TAX CARDS... 100 TITLE REPORT... 102 DEED... 107 SAMPLE EASEMENT... 108 LISTING PAGE FOR SUBJECT PROPERTY... 111 CONTACT LETTER... 113 ENGAGEMENT LETTER... 114 4

Parcel No.: Ownership: SUMMARY OF SALIENT FACTS AND CONCLUSIONS3 35-1S-24-0000-0042-0000 Capri Commons, LLC, Post Office Box 5497, Destin, Florida 32541 Property Identification: Location of Property: Capri Commons Mobile Home Community 928 Carolos Street Ft. Walton Beach, Florida 32547 Title Reference: Warranty Deed, Okaloosa County public records, OR Book 2640, Page 3368. Present Use of the Property: Improvements: Zoning: Future Land Use: Concurrency: Property rights appraised: Mobile Home Park Asphalt, utilities, trailer space improvements. R-2, Residential MDR, Medium Density Residential Adequate infrastructure exists to support the highest and best use of the property. Permanent, subterraneous sewer easement And 2.5 year temporary construction easement Highest and Best Use: Area of Parent Tract: Area of Permanent Utility Easement: Multi-Family Development 14.25 acres 16,781 SF Area of Temporary Construction Esmt: 8,570 SF Area of Remainder: Date of Value: 14.25 acres January 31, 2012, date of last inspection Date of Report: February 2, 2012 5

BROAD LOCATION MAP INCLUDING THE SUBJECT Florida Panhandle, from Mobile to Tallahassee South Tri-County area 6

LOCATION MAP South Okaloosa County Location map 7

AERIAL MAP SHOWING PARENT TRACT 8

AERIAL MAP SHOWING PARENT TRACT 9

APPRAISER S SKETCH SHOWING PARENT TRACT & EASEMENT ACQUIRED Subject Property / Parent Parcel PARENT PARCEL: PERMANENT EASEMENT: TEMPORARY EASEMENT: 14.255 acres or 620,960 SF 16,781 SF (Orange above) 8,570 SF (Green above) 10

SKETCH OF EASEMENT AREA (PROVIDED BY CLIENT) 11

12

13

EASEMENT AERIAL 14

ZONING MAP 15

FUTURE LAND USE MAP 16

SOIL MAP OF SUBJECT Symbol Soil Slope % Drainage Soil Material & Characteristics 12 Lakeland Sand 0-5 Excessive Nearly level to gently sloping soil found on broad ridgetops in the uplands. Permeability is rapid. Seasonal high water table is at a depth of more than 80 inches. Soil is well suited for use as a homesite, small commercial buildings, and local roads and streets. 27 Urban Land 0-5 Well Drained Nearly level or gently sloping areas that are covered with airports, shopping centers, parking lots, large buildings, streets or sidewalks. The natural soil generally cannot be observed. Uncovered areas (lawns, parks, vacant lots, playgrounds, etc) consist of the well-drained soils of Bonifay, Foxworth, Kureb, Lakeland and Troup soils. Onsite investigation is needed to determine the suitability of areas for a particular purpose. 17

FLOOD MAP FEMA Community Panel #12091C0435H dated 12/06/2002, identifies the subject as being located in Zone X. Zone X is classified as having a minimal probability of flooding. 18

PHOTOGRAPHS OF SUBJECT PROPERTY Main Entrance Sign at Carlos & Racetrack Road View north along Carlos Drive from Racetrack Road 19

PHOTOGRAPHS OF SUBJECT PROPERTY View of typical homes along Carlos View along Valdez facing west from Carlos 20

PHOTOGRAPHS OF SUBJECT PROPERTY View South along Carlos from Valdez View along Valdez facing east from McFarlan 21

LEGAL DESCRIPTION A legal description for the parent parcel was obtained from the last deed of record, a Warranty Deed recorded in OR Book 2640, Page 3368 in Okaloosa County Public records, which records the purchase of the property. We were provided a legal description for the easements by the client, Hatch Mott Macdonald, in a sketch (identified as project # 299802) dated 1-17-2012. A copy of the deed is in the addenda and the easements are in the exhibits section of the report. PURPOSE OF THE APPRAISAL The purpose of this appraisal is to estimate the market value of the parent property in fee simple and the value of the property rights acquired together with severance damages, if any. FUNCTION AND INTENDED USER OF APPRAISAL The intended use of this appraisal is to assist in establishing recommended compensation for the acquisition of the real property rights associated with a 20 wide permanent sewer easement and 10 temporary construction easement. The easements are needed for the installation of an underground sewer line and for any future maintenance of same. The intended user of the report is Hatch Mott Macdonald, C/O City of Fort Walton Beach and Okaloosa County. 22

APPRAISAL METHODOLOGY We will first conduct a valuation of the parent tract land in fee simple and then analyze the value of the rights associated with the acquired utility easement. Subsequently the value of the remainder will be estimated so that the presence or absence of severance damages can be ascertained. SCOPE OF THE APPRAISAL Primary data concerning region, neighborhood and the property was obtained through discussions with city and county government officials, taxing authorities, zoning authorities, the property appraiser's office and utility companies. Secondary data was obtained from the Northwest Florida Regional Planning Council, the Chamber of Commerce, Realtor Publications and Metro Market Trends (a local data base company). This firm has completed numerous appraisal assignments in the subject neighborhood and we have compiled considerable data for same. Much of the data incorporated in this appraisal analysis has come from our files and was updated/expanded as necessary in performing our appraisal analysis. The nature of the market data collected has been determined based upon a thorough inspection of the subject property and resulting highest and best use analysis. Within the confines of this analysis, the appraiser has made an examination of all available and pertinent market data that could be located within a minimum time frame of at least six months before and after the effective date of the appraisal. However, this search has been extended substantially in many areas, in order to obtain a sufficient quantity of market data. The search was limited to the SMSA, with the most emphasis placed on those areas most proximate or similar to the subject. Also, the selection of the data reported is limited to that data which the appraiser considers relevant to the assignment and to the purpose of the appraisal, under the terms of the highest and best use conclusions rendered herein. 23

This is a summary appraisal report prepared in compliance with the Uniform Standards of Professional Appraisal Practice. Based upon the client s intended use of this report, we have developed a scope of work that entails a valuation of the site only. This scope of work is sufficient for deriving a value for the property rights to be acquired and for the evaluation of any damages that may occur as a result of the acquisition. APPRAISAL PROBLEM The appraisal problem is to estimate the value of the rights associated with the acquisition of a 20 wide permanent subterraneous easement over a portion of the parent property. The proposed easement will encumber 16,781 SF of a 14.25 acres parent tract that is improved with a mobile home park. The existing buildings are unaffected by the easement, which matches the path of the interior roads and driveways through the mobile home park. The proposed easement will follow Carlos Lane from Racetrack Road northward, and then veer west along Valdez Lane, until it terminates at the western boundary of the property, along McFarlan Avenue. It is our opinion that the location of this easement, being a narrow strip of land along existing roadways, being subterraneous in nature, and with the utility provider being responsible for the restoration of most improvements potentially disrupted by any maintenance activity, renders this easement as minimally intrusive. To our knowledge, there are presently, no existing building or site improvements located within the easement area and the easement is being used for roadway. 24

The appraisal problem is best solved by a before and after appraisal analysis that first considers the value of the existing parent parcel, unencumbered. Subsequently, an after appraisal can then be developed that examines the effect of the acquisition upon the remainder property. DEFINITION OF MARKET VALUE "The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1) buyer and seller are typically motivated; 2) both parties are well informed or well advised and each acting in what they consider their own best interests; 3) a reasonable time is allowed for exposure in the open market; 4) payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and 5) the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale." 1 1 Uniform Standards of Professional Appraisal Practice as promulgated by the Appraisal Standards Board of the Appraisal Foundation (1/1/08-12/31/09). - Also, as defined by the Office of the Comptroller of the Currency under 12 CFR, Part 34, Sub-part C Appraisals, 34.42 Definitions (g). 25

EXPOSURE TIME The above definition assumes a reasonable exposure time during which the subject would have been offered on the market prior to the hypothetical consummation of a sale, at market value, on the effective date of the appraisal. Based upon a retrospective estimate, the appraiser has concluded an exposure time of from six to twelve months. MARKETING PERIOD The reasonable marketing time is an estimate of the length of time it might take to sell the subject property at the above estimated market value level during the period immediately after the effective date of the appraisal. This marketing time has been estimated at six to twelve months for the subject property, based upon presently available market information. PROPERTY RIGHTS TO BE APPRAISED The appraisal of the Permanent 20 Sewer Easement is an appraisal of the rights associated with a perpetual easement that is subterraneous in nature. The easement shall extend into perpetuity, with the easement beneficiary having the right to utilize the described property for subsurface utility lines. This includes, not only the occupancy of the subsurface, but also the potential use of the surface for access and maintenance of the subsurface. The owner will retain rights of use and occupancy for the surface. The owner retains the right to utilize the surface land area for minor site improvements (i.e. concrete, gravel, asphalt, sod, clay or landscaping) but not vertical 26

building or structural improvements. Although the beneficiary of the easement maintains the right to disrupt the surface, if necessary, for maintenance, such disruption is expected to be very rare, if at all. In the event such surface disruption should disturb any existing improvements or any minor site improvements erected in the future by the owner, the easement beneficiary would restore such surface disruption in like kind, upon completion of the repair. The permanent and regular occupancy of the easement is to be below ground, in piping and not visible on the surface. ZONING, FUTURE LAND USE, CONCURRENCY The property is within the zoning jurisdiction of Okaloosa County, Florida. According to the Okaloosa County Division of Planning and Zoning, the subject is subject to the R-2, Residential/Suburban Residential Districts. R-2 district is described in the County Land Development Code as follows: Purpose of district - The purpose of the residential-2 (R-2) and suburban residential (SR) districts is to provide areas for medium density residential housing, and to provide for certain non-residential uses that contribute to the comfort and convenience of the district. Uses permitted The following uses are permitted as of right in an R-2 district. All other uses are permitted by special exception or prohibited. 1. Residential. Single-family detached and attached dwellings; category A and B mobile/manufactured homes; duplex, triplex, quadraplex dwellings; townhomes; multi-family; customary accessory uses; home occupation; home office of convenience; family day care homes. 2. Non-residential. Utilities customary to residential areas (such as power lines, water mains, sewer mains, lift stations, water supply wells, and other similar facilities necessary for the collection, transmission or distribution of utility service) parks; playgrounds; and recreation facilities; community facilities (i.e. neighborhood civic center, golf course, tennis courts, etc.), public transit stops and shelters. 3. Community residential homes with six or fewer residents licensed by the state and located as prescribed by Chapter 419, Florida Statutes. 4. Public and private schools and houses of worship subject to compatibility analysis. 5. Customary accessory uses and structures incidental to residential uses (see section 2.21.00). The following uses may be allowed by the granting of a special exception by the board of adjustment: 1.Electric power substations which can demonstrate compatibility with the surrounding area through sitespecific setbacks, buffering, and other conditions appropriate to the area within which the substation is proposed. 2.Other uses which, in the opinion of the planning official, are similar in nature to other uses allowed either as permitted uses or special exceptions. 27

TABLE 2.4 RESIDENTIAL (R-2) AND SUBURBAN (SR) BULK REGULATIONS MAXIMUM DENSITY Single-family detached Single-family attached (townhouse, minimum 2 units/bldg.) Duplex/Triplex/Quadraplex Multi-Family No more than 6 dwellings/acre No more than 16 dwellings/acre No more than 16 dwellings/acre No more than to 16 dwellings/acre MAXIMUM INTENSITY R-2 0.10 FAR (non-residential uses) 55% ISC MINIMUM BUILDING SETBACKS Single-family Detached Single-family Attached SR Duplex, Triplex Quadraplex 0.25 FAR 60% ISC Multi-Family Front 1 20 feet 20 feet 20 feet 20 feet Sides 7.5 feet 7.5 feet 10 feet 10 feet Rear 10 feet 10 feet 10 feet 10 feet MINIMUM LOT FRONTAGE MAXIMUM BUILDING HEIGHT 20 feet 45 feet NOTE: See section 12.19.00 for possible additional requirements. 1 If the property abuts multiple roads, the front setback shall be from the road from which the subject property's address is derived, with the rear being the side opposite the front provided, however, that in no case shall a building intrude into a visibility triangle of an adjacent property or road intersection, nor shall any building intrude into a roadway right-of-way area. Future Land Use - The subject parcel is located in the MDR, Medium Density residential future land use designation. Per Marissa Martinez, South Okaloosa Land Planner, mobile home parks are not permitted in this future land use, but we have been informed that the subject property has been grandfathered in. Concurrency - Development orders or permits require a Certificate of Concurrency with approval contingent upon a finding that adequate public facilities (e.g., roadways, water/sewer, parks, drainage, and waste) will be available concurrent with the impact of the proposed development. We are aware of no concurrency issues at the subject property at this time that would restrict or delay future development. 28

Grandfathering - We are aware that the subject property s exiting use as a 134- lot mobile home park has been grandfathered in under the existing future land use. As grandfathered, the property achieves a density of only 9.4 units per acre, whereas it could achieve 16 units per acre if re-developed for conventional multi-family purposes. ASSESSMENT AND TAXES The subject property is assessed by the Escambia County Property Appraiser under Reference Number 35-1S-24-0000-0042-0000. The property is assessed to Capri Commons, LLC, Post Office Box 5497, Destin, Florida 32541. The 2011 assessment for the property is $1,320,653, allocated as $1,254,000 to the land, $49,991 for the improvements and $16,662 for extra features. The 2011 taxes are $17,536.84. We are not aware of any other tax assessments pertinent to the subject property. HISTORY OF PROPERTY The subject property was acquired by the current owners, Capri Commons, LLC from Villa Socin Mobile Home Park, LLC on August 3, 2005 in a deed located in OR Book 2640, Page 3368. The indicated consideration is $2,400,000 ($168,360/Acre). The transaction is over five years old and occurred near the peak of the market. We have not considered any rental information for the mobile homes or mobile home lots, as this is an appraisal of land only. We are not aware of any other transactions related to the subject property within the previous three years. 29

GENERAL AREA DATA A detailed description and analysis of the broad market area is included in the addenda. Based on our analysis, we are of the opinion that the demand for real estate should remain generally consistent in the broad market area. SUBJECT NEIGHBORHOOD DATA The subject s neighborhood is bound by Choctawhatchee Bay to the east, Santa Rosa Sound to the south, and Eglin Air Force Base to the north and west. The subject is located on the west side of Beal Parkway, approximately 300 north of Park Drive. This portion of Fort Walton Beach is one of the most concentrated commercial and retail shopping areas in the greater Fort Walton Beach area. A visual depiction of the neighborhood is shown on the map below: SUBJECT 30

Within the immediate vicinity of the subject, we see many commercial uses along major thoroughfares. There are also densely developed and older residential dwellings situated axially off the thoroughfares. The subject is located in a dense residential area that is accessed directly from U.S. 98 by a 50 wide easterly extension of the property. The neighborhood is almost fully built-out and personnel expansions at Eglin Air Force Base are fueling residential development in adjacent communities like Navarre and Crestview. Opportunities for residential infill projects within the subject neighborhood should be well received. In summary, the subject is situated in a central location within the neighborhood and is very well positioned for a variety of dense residential applications. The future of the neighborhood appears good as it is largely built out and vacancy rates appear low in surrounding projects. There is some redevelopment of older properties, and many land listings feature older properties that would obviously be razed for any future new development if sold. Our perception is that generally consistent demand should be manifest in the neighborhood into the foreseeable future. 31

DESCRIPTION OF THE PARENT TRACT The parent tract is an expansive parcel of 14.25 acres in a somewhat irregular shape, with substantial frontage along McFarlan Ave. and additional access off of Racetrack Road via a 50 x 200 narrow strip called Carlos Drive. The parent parcel has +/- 50.00 of frontage along the north side of Racetrack Road, 1,134.62 on the east side of McFarlan Avenue NW and 642.32 on the south side of Verb Street. Racetrack Road is a heavily traveled roadway (28,500 vehicles per day) that provides east/west access the Fort Walton Beach area. A complete delineation of the site boundaries is depicted on a site sketch and in exhibits, presented earlier in this report. The subject site is basically level and approximately even with the abutting road grade. All public and/or private utilities are available to the site. Drainage at the site appears adequate. Soil maps indicate that the subject is primarily Lakeland Sand, 0-5% slope, a level, excessively drained soil conducive for development. We also note a small amount of a soil type denoted as Urban Land, which is another well-drained soil. Urban land is identified as those areas that have been improved and/or degraded to the point that have lost all original soil characteristics. Observation of the improvements in the vicinity would indicate that there is sufficient soil bearing capacity to support industrial/commercial improvements typically found in the general area. A soil map is included in the exhibits section of this report. The subject property presently accommodates a mobile home park and the homes are accessed by paved streets throughout the parcel. The Federal Emergency Management Agency Flood Insurance Rate Map, Community Panel number 12091C0435H, dated 12/06/2002, indicates the subject property is located within an X flood zone, an area of minimal flooding. A copy of said map is included within the exhibits of this report. 32

Existing Easements To the best of our knowledge, there are no existing easements on the parent property, except for peripheral utility lines. We are not aware of any other easements, encroachments or restrictions that adversely impact the site at this time. HIGHEST AND BEST USE The Highest and Best Use is defined as follows: "That reasonable and probable use that will support the highest present value, as defined, as of the effective date of the appraisal. Alternately, that use, from among reasonable, probable and legal alternative uses, found to be physically possible, appropriately supported, financially feasible, and which results in highest land value." In estimating highest and best use of the subject site, the following were taken into consideration: 1) The uses physically possible on the site 2) The uses legally permissible at that site 3) Financially feasible uses of the site 4) The most productive use of the property AS VACANT : Physically Possible: As vacant, the parent site is physically suitable for various uses with a site area of approximately 14.25-Acres (+/-). The property consists of a moderate sized acreage tract located on the north side of Racetrack Road, just east of McFarlan Avenue. The property has substantial frontage along McFarlan, a residential street, and access via a 50 wide extension from Racetrack Road, a major thoroughfare. The property is level with all utilities available. Legally Permissible: The property is within the R-2, Residential zoning district. The R-2 district is permissive of single family and multi-family residential development, 33

churches and schools. With respect to the MDR (Medium Density Residential) future land use classification and the lack of concurrency issues, the property is legally suitable for a variety of multi-family uses. The property can be developed for multifamily purposes to a density of 16 units per acre. The property is presently being under-utilized as a trailer park to a density of only 9.4 units per acre. Financially Feasible: The subject property is located in a dense residential area that is nearly fully developed. There is high demand for residential occupancies in the area as a result of the personnel expansions at the proximate Eglin Air Force Base. However, because so much of the area is already developed with older structures, much of this demand is being served by adjacent communities, such as Navarre and Crestview. As a result, parcels such as the subject that are sufficiently large to allow for infill are highly desirable. The present use of the subject property as a trailer park is an under-utilization of the property because it does not achieve maximum density or develop the property to its highest potential. Most Productive Use: The most productive use is deemed to be redevelopment with dense multi-family use such as apartments, condominiums, townhomes, zero-lot line homes, patio homes, or other dense conglomerations of conventional built structures. The existing use of the property is not the highest and best use because it is an under-utilization of the property in terms of both density and the quality of development. The existing improvements consist of only site improvements or mobile structures that could be easily moved. Clearly, the highest and best use for the property is redevelopment for dense multi-family residential purposes. 34

APPROACHES TO VALUE There are three approaches to value or techniques that are utilized in the appraisal of real property. The appraiser has given consideration to all three approaches, but has determined the Cost and Income Approaches are inappropriate to the valuation of the subject property as this is an appraisal analysis of land. The sales comparison approach to value is the most valid indicator of value for land. The cost and income approaches to value lack relevance to the valuation of land only or have minimal market support and are therefore excluded from our analysis. PARENT TRACT LAND VALUATION The Sales Comparison Approach is employed for valuation of the subject land. We have located several sales, which provide for good comparisons to the subject parcel. Detailed data sheets relative to the selected sales are included on the following pages. On a subsequent page is a sales comparison grid that summarizes and compares the amenities of the subject property with those of the comparable sales to arrive at an indicated value for the subject land. With this in mind, we proceed with the presentation of the sale data sheets for the comparable sales. 35

LOCATION MAP FOR SUBJECT AND COMPARABLE LAND SALES 36

Land Sale No. 1 Property Identification Record ID 4793 Property Type Vacant Commercial Acreage Property Name Vacant Commercial Acreage Address 5300 Ferdon Blvd S (Highway 85), Crestview, Okaloosa County, Florida Location W/S of Ferdon Blvd between Hwy 4 & PJ Adams Pkwy Tax ID 05-2N-23-0000-0006-0000 & 0009-0010 Present Use vacant Sale Data Grantor Albich Holdings LLC Grantee Hit Sum to Me LLC Sale Date April 15, 2011 Deed Book/Page 2981/1192 Property Rights Fee Simple Marketing Time 14.7 Conditions of Sale Arms Length Financing Cash or equal. Sale History None in prior three years Instrument Warranty Deed Verification Tammy Henderson, LA, Pelican Real Estate; 850-496-4838, May 02, 2011; Other sources: Public Records, MLS 525225, Confirmed by Rosanna Banks Sale Price $450,000 Land Data Zoning C-1, City of Crestview, Commercial Topography Level, uplands near/above road grade Utilities All avail. Dimensions 300 x 1033 x 300 x 932 x 100 x 100 Shape Sl. Irregular 37

Land Sale No. 1 (Cont d) Landscaping Cleared, Level, some paving Flood Info "X" per 255 Future Land Use C, Commercial Highest & Best Use Commercial Development Encumbrances None noted Land Size Information Gross Land Size Front Footage 5.290 Acres or 230,432 SF 300 ft Total Frontage: 300 ft Highway 85, Paved 170' ROW (per deed) Indicators Sale Price/Gross Acre $85,066 Remarks The buyers are developing this property with a daycare chain, a national bank training center, a department of defense contractor office and 17 residential lots at the rear of the parcel, on which Ms. Henderson says the buyers will build houses and sell. At the site, Highway 85 is four-laned, with a grassed median. The entire parcel is soil type 36, Bonifay Sand, 0-5% slope, a well drained soil. The property has been listed continuously since April 7, 2008 when it was placed on the market for $2,900,000. It was reduced six times until September 3, 2010, when it was listed for $650,000. It was listed at that price for seven months, until it sold in April 2011. This is the site of the former Sundial Mobile Home Park. All mobile homes were removed prior to the sale, and remaining improvements consist of asphalt paving, chainlink fencing and light poles. The density prior to the sale was 36 mobile home lots, or 6.8 per acre. 38

AERIAL MAP OF LAND SALE 1 39

Land Sale No. 2 Property Identification Record ID 4827 Property Type Vacant Commercial Land Property Name Vacant Commercial Land Address 13331 Emerald Coast Parkway, Miramar Beach, Walton County, Florida Location SE Cor. Emerald Coast Pkwy. and Sandy Cay Dr. Tax ID 30-2S-21-42000-005-0000 Present Use Vacant Commercial Land Sale Data Grantor Fifth Third Bank Grantee GC Coastal VI, LLC Sale Date May 20, 2011 Deed Book/Page 2866 4096 Property Rights Fee Simple Marketing Time 502 Days Conditions of Sale Arm's Length Per Agent Financing Cash to Seller Sale History No other qualified w/n previous 3-Years Instrument Special Warranty Deed Verification Greg Clauson, Listing Agent; 850-376-7289, May 27, 2011; Other sources: MLS 527163, Public Records, Confirmed by Bruce A. Black Sale Price $1,000,000 DS $7,000 Land Data Topography Utilities Dimensions Shape Flood Info Future Land Use Highest & Best Use Encumbrances Land Size Information Gross Land Size Front Footage Mostly Level, Excessively Drained Soil All Necessary Available Metes and Bounds Irregular Zone X CC, Coastal Center Commercial Development None Noted 5.99 Acres or 261,332 SF 955 ft Total Frontage: 563 ft SS Emerald Coast Parkway;392 ft ES Sandy Cay Drive Indicators Sale Price/Gross Acre $166,945 Remarks This is a sale of vacant commercial land located at the southeast corner of the intersection of Emerald Coast Parkway and Sandy Cay Drive, in Miramar Beach, FL. The site is situated adjacent west of Parish Bank. It directly fronts Hwy 98 (Emerald Coast Parkway), and had excellent exposure. Soil mapping indicates that the property is comprised of Kureb sand, which is excessively drained. The property appears high and dry, and is within Flood Zone X, an area of minimal flood probability. CC, Coastal Center allows 8 DU per Acre. 40

AERIAL MAP OF LAND SALE 2 Okaloosa/Walton Co. Line 41

Land Sale No. 3 Property Identification Record ID 5076 Property Type Commercial/Multifamily Property Name Commercial/Multi-Family acreage Address 2200 Hammock Square Drive, Lynn Haven, Bay County, Florida Location Market Shops of Lynn Haven Development Tax ID 11667-280-006 Present Use Pinnacle at Hammock Square Apartments Sale Data Grantor Market Shops of Lynn Haven, LLC Grantee Pinnacle at Hammock Square, LLC Sale Date September 30, 2010 Deed Book/Page 3274/1643 Recorded Plat 24/11 Property Rights Fee Simple Marketing Time UK Conditions of Sale Arms Length Financing Cash or equal Sale History None in prior three years Instrument Warranty Deed Verification Jerry Miller, The Miller Group; 850-585-5217, December 12, 2011; Other sources: Public records, verbal, Confirmed by Rosanna Banks Sale Price $1,078,900 Land Data Zoning Topography Utilities Dimensions Land Use only per City of Lynn Haven, Mu, Mixed Use Poorly to Very poorly drained All avail 385.6x484.8x131.1x96.5x177.2x492.1 42

Land Sale No. 3 (Cont d) Shape Irregular Flood Info "A" & "X", 12005C0332H Future Land Use MU (LH) Mixed Use Highest & Best Use Multi-Family development Encumbrances CCR (3074/71) Land Size Information Gross Land Size 8.450 Acres or 368,082 SF Allowable Units 169 Front Footage 55 ft Total Frontage: 55 ft Hwy 77 Actual/Planned Building SF 100 Indicators Sale Price/Gross Acre $127,680 Remarks This is the sale of Lot R-1 in Market Shops of Lynn Haven. This parcel is located along the west side of Hwy 77. The parcel is part of a planned development called Market Shops at Lynn Haven. The commercial shopping center is currently anchored by a Publix, and the existing outparcels are developed with Innovations Credit Union, a Zaxby's, a Regions Bank branch and a Sonny's BBQ is underway. This site is part of the planned multi-family development called Pinnacle at Hammock Square. The site contained poorly drained soils (#13, Osier Fine Sand, #33 Leon Sand & #29, Rutlege Sand) but was filled. The site is connected to retention pond and the buyers paid for grading and filling. Mr. Miller stated that the buyers paid for infrastructure. The City of Lynn Haven does not have zoning categories and instead utilizes Land Use Categories. The entire Shopping Center Complex is under the land use Mixed Use. Per City Development (2.01.04) The MU land use district is designed for residential, commercial, & public/institutional development, as well as a mixture of residential uses & non- residential uses. For residential-only projects, the maximum residential density is 10 units per acre. Allowable Commercial uses are Professional offices, services, & commercial uses. Any (commercial) project that combines uses with residential units may be allowed residential densities up to 20 units per acre. The property has since been improved with a multi-story apartment complex. attached is from their website. The image 43

AERIAL MAP OF LAND SALE 3 44

Land Sale No. 4 Property Identification Record ID 5136 Property Name Vacant multi-family land Address Sea Croft Drive, Santa Rosa Beach, Walton County, Florida Location S/S of Sea Croft Drive, 1,000' east of 393 Tax ID 02-3S-20-34160-000-050 Land Use Code SFR Present Use Vacant Sale Data Grantor First National Bank of Florida Grantee Serra Holdings, LLC Sale Date March 30, 2011 Deed Book/Page 2863/1648 Recorded Plat HOLD Property Rights Fee Simple Marketing Time 532 DOM Conditions of Sale Arm's Length, bank owned Financing Cash or equal. Sale History CT $100 2812/132 (3-5-2009) Instrument Warranty Deed Verification Other sources: Public Records only, CS 2131951, Confirmed by Rosanna Banks Sale Price $270,000 Land Data Zoning see FLU, Multi-Family Topography Level, mod. to well drained [83% ST#12, Foxworth; 17% ST#17 Lakeland] Utilities All avail or prox., Regional Utilities Water & Sewer Dimensions 325 x 325 Shape Square Landscaping Cleared Flood Info X, 12131C0676G Future Land Use FLU is NI-Neighborhood Infill Highest & Best Use hold for multi-family development Encumbrances None noted Land Size Information Gross Land Size 2.510 Acres or 109,336 SF Indicators Sale Price/Gross Acre $107,570 45

Land Sale No. 4 (Cont d) Remarks This is the sale of vacant land, which appears to have been planned for multi-family development in the past, before the market downturn. Conversations with Vivian, the South Walton Land Planner revealed that in 2006, previous owners received a final order from the Walton County Commission to construct an unnamed multi-family project, and the order was extended in January of 2010. The order is set to expire on July 10, 2013. A Development Order was never approved because there are issues that need to be addressed. Sea Croft Road is a dirt roadway, and all users of the road from CR 393 to Satinwood Drive must come together to have the road paved before dense development can occur. Density is 8 DU per acre AERIAL MAP OF LAND SALE 4 46

Land Sale No. 5 Property Identification Record ID 4317 Property Name Vacant Secondary Commercial/Multifamily Address 8905 Untreiner Avenue, Pensacola, Escambia County, Florida Location W/S Untreiner Ave, across from Powell St Tax ID 10-1S-30-1101-102-001,-098-001,-099-001 Date Inspected June 8, 2009 Present Use Vacant Secondary Commercial/Multifamily Land Sale Data Grantor Doris Martin, Harvey E. Brewton, Sr., Angus Brewton, Jr, et al Grantee Troy and Jennifer Templeman Sale Date May 29, 2009 Deed Book/Page 6466/237,240,24 Recorded Plat 3 Property Rights Fee Simple Marketing Time 4.5 months Conditions of Sale Arms Length Financing Conventional Mtg $256,500 Sale History No prior sales within the past three years. Instrument 3 Warranty Deeds Verification Joe Wanek, Listing Agent w/ Connell & Manziek Realty; (850) 478-4141, June 08, 2009; Other sources: Public Records, Inspection, Confirmed by Barbara M. Martin Sale Price $285,000 Land Data Topography Utilities Dimensions Shape Flood Info Future Land Use Highest & Best Use Encumbrances Level, at road grade All available except sewer Irregular - see site sketch Rectangular Zone X C, Commercial Secondary Commercial/Multifamily Development No adverse noted Land Size Information Gross Land Size 3.470 Acres or 151,153 SF Allowable Units 86 Front Footage 135 ft Untreiner Ave Indicators Sale Price/Gross Acre $82,133 47

Land Sale No. 5 (Cont.) Remarks This is the sale of 3.47 acres of secondary commercial/multifamily land located on Untreiner Avenue within an area characterized by older mixed use properties. The land is comprised of two parcels divided by an access easement. A large County retention pond adjoins its west boundary. This property was rezoned from R-5, Urban Residential/Limited Office District to C-1, Retail Commercial District in April 2009, one month prior to the closing of this sale. Due to its secondary location, this parcel is better suited for secondary commercial or multifamily residential development. C-1 permits a maximum density of 25 units per acre. AERIAL PHOTOGRAPH OF COMPARABLE 5 48

Land Listing No. 6 Property Identification Record ID 5144 Property Type Vacant Multi-Family Land Property Name Multi-family land, "Lakes at Stonebrook" Address 1111 Lakes Drive, Pace, Santa Rosa County, Florida Location W/S of Woodbine Road, at Stonebrook Golf Course Tax ID 31-2N-29-0000-00614-0000 Date Inspected Numerous Sale Data Grantor B & E Holdings LLC and Robert E. Dale, Jr. Survey Date February 01, 2011 Property Rights Fee Simple Marketing Time >8 Mo. Conditions of Sale Arm's Length Financing Cash Sale History $100 CT 2890/469 3-5-2009 Instrument Certificate of Title Verification Ferd Saloman, LA; Other sources: Inspection, MLS 410591& Costar 8102025, Public records, Confirmed by Rosanna Banks Listing Price $950,000 Land Data Zoning Topography Utilities Dimensions Shape Landscaping Future Land Use Highest & Best Use Encumbrances SR County, R3, 18 DU/Ac, R-3, High Density Residential& HCD, 10 DU/Ac Well drained soils, with lakes present All available M&B Irregular level, cleared SFR and Comm MF development Gulf Power Easement 49

Land Size Information Gross Land Size Front Footage Land Listing No. 6 (Cont.) 10.040 Acres or 437,342 SF 830 ft Total Frontage: 830 ft Cobblestone Drive Indicators Sale Price/Gross Acre $94,622 Remarks This is the listing of a 10.04 acre parcel of land which had a development order in place for 36 luxury townhomes, before the downturn in the market. The DO is now expired. Approximately 9.6 acres is zoned R-3 and the remaining.4 acres is zoned HCD. The maximum density for this parcel is 176 units. Soil maps indicate the following soil types: # Map Unit Name Percent of AOI 5 Bonifay loamy sand, 0 to 5 percent slopes 13.9% 8 Dothan fine sandy loam, 0 to 2 percent slopes 27.2% 25 Lucy loamy sand, 0 to 5 percent slopes 32.7% 38 Red Bay sandy loam, 0 to 2 percent slopes 26.2% Totals for Area of Interest 100.0% There is a gulf power easement across the south boundary of the property. Through scaling, it appears to vary from 121' to 157' in depth and encompasses approximately 2.8 acres of the site. AERIAL MAP OF LISTING 6 G.P. Easement 50

SOIL MAP OF LISTING 6 The above sales are organized in the following chart in order to facilitate our comparison with the subject and the adjustment process. 51

ITEM Location Prox to Subject Sales Price SUBJECT N/S of Racetrack Rd N/A N/A Site Area (Ac) 14.25 Price/SF N/A Property Rights Fee Simple Similar Similar Similar Similar Similar Similar Adjusted Price/Ac N/A Financing Cash or Equiv Similar Similar Similar Similar Similar Similar Adjusted Price/Ac N/A Conditions of Sale Arm's Length Similar Similar Similar Similar Similar Neg. Allow. -5% Adjusted Price/SF N/A Buyer Expenditures None Similar Similar Similar Similar Similar Similar Adjusted Price/Ac N/A Time/Mkt Conditions Jan-12 Apr-11 May-11 Sep-10 Mar-11 May-09 Current Adjusted Price/Ac N/A Location N/S of Racetrack Rd Offsets Primary Exp. -25% Similar Inferior 15% Inferior 25% Similar Site Area (Ac) 14.25 5.29 5.99 8.45 2.51 3.47 10.04 Frontage Good Good Good Limited Inferior Good Good FF 1,827 300 5% 955 55 5% 325 135 5% 830 FF/Ac 128 57 159 7 129 39 83 Corner/Interior Dual Access Interior 5% Dual Access Interior 5% Dual Access Interior 5% Interior 5% Zoning & Density R-2; 9.4/Ac; 16/Ac C-1, City; 6.8/Ac 5% CC; 8/Ac 5% MU; 20/Ac NI; 8/Ac 5% C-1, 25/Ac -5% R3, 18/Ac Utilities All Avail. All All All All No sew er 10% All Shape/Utility Irregular Rect./Avg. Irreg./Avg. Irreg/Avg. Rect./Avg. Sl. Irreg/Avg. Irreg/Avg. Encumbrances None noted None None None None Access Esmt 10% Pow erline 10% Topography Level, Uplands Similar Similar Fill/Offst Ret. Similar Similar Similar Net Phys Adj % 15% -20% 10% 20% 50% 15% Adjusted Price/Ac $121,248 Relative Weight 100% Weighted Mean $122,823 LAND SALE 1 Ferdon Blvd 18 Miles N $450,000 5.29 LAND SALES COMPARISON GRID Hammock Square Dr 60 Miles SE $1,078,900 8.45 $85,066 $166,945 $127,680 $85,066 $85,066 $85,066 $85,066 $85,066 LAND SALE 2 Emerald Coast Pkw y 14 Miles SE $1,000,000 5.99 $166,945 $166,945 $166,945 $166,945 $166,945 LAND SALE 3 LAND SALE 4 $127,680 $127,680 $127,680 $127,680 $127,680 Sea Croft 25 Miles SE $270,000 2.51 $107,570 $107,570 $107,570 $107,570 $107,570 $107,570 $97,826 $133,556 $140,449 $129,084 15% 20% 20% 15% $14,674 $26,711 $28,090 $19,363 LAND SALE 5 Untreiner Ave 39 Miles E $285,000 3.47 $82,133 $82,133 $82,133 $82,133 $82,133 $82,133 $123,199 15% $18,480 LAND LISTING 6 Lakes Dr 36 Miles NE $950,000 10.04 $94,622 $94,622 $94,622 $89,890 $89,890 $89,890 $103,374 15% $15,506 52

Unit of Comparison: A unit of comparison is a component into which price is divided to facilitate comparison. Typical units of comparison employed by appraisers are price per square foot, price per acre, price per front foot, price per square foot of building area, price per room, etc. The function of the selected unit of comparison is to automatically adjust comparables for size. In the above grid, we utilized the unit of comparison of price per SF of land. We have chosen this unit of comparison because we believe this is the manner in which a typical buyer or seller would most likely frame an acquisition or disposition decision. Additionally, this unit of comparison is valid for this appraisal because the existing subject improvements are a close approximation of the highest and best use of the property. As previously mentioned, in analyzing the subject and comparable properties, the appraiser will make his analysis within the land comparison grid in terms of selling price per acre. Adjustments are then applied to each calculated unit of comparison to account for observed differences between the subject property and the comparables. In making adjustments, the appraiser has assumed the subject property to be the market standard. When the amenities of a particular comparable sale exceed those of the subject, the sale price of the comparable sale has been reduced or adjusted downward. When the reverse is true and the comparable sale is inferior to the subject, the sale price of the comparable sale is increased. The reader should note that the magnitudes of the adjustments deployed are supported by hundreds of similar grids that the appraiser has prepared over the course of the last 25 years as a full time appraiser. The grids from the last thirteen of these years are preserved in the Appraisers files and serve to repetitively isolate the same or similar elements of comparison within the same 53

or similar submarkets. Thus, hundreds of comparison grids exist in the appraiser s files that effectively contain hundreds of paired sales which support a relatively tight range for the percentage impacts upon price caused by the dissimilarities dealt with in our analysis of the subject property. Following is a brief explanation of adjustments applied in the above comparison grid. Property Rights - To the best of the appraiser's knowledge, all of the comparable sales were of fee simple interest. Because the appraiser is estimating the value of the fee simple interest in the subject property, no adjustment is required for this element of comparison. Financing - The appraisal is made in terms of cash or terms generally equivalent thereto. All of the comparables represent either a "cash to seller" arrangement or financing at market terms. For this reason, no adjustment is necessary in this category of comparison. Conditions of Sale - To the best of the appraiser's knowledge, all of the comparable sales were found to be "arms length" transactions without evidence of any undue influence or duress. For this reason, these comparables were sold under conditions of sale that are compatible with the market value definition and no adjustment is required. The exception is comp 6, which is not an actual sale but only a listing. As a result, comp 6 is adjusted negatively to account for negotiations likely to occur before arriving at an effective price. Buyer Expenditures None of the comparables involved any extraordinary buyer expenditures for demolition, rezoning and/or environmental considerations, thus, no adjustments were necessary. 54

Time/Market Conditions - Our perception is that the market is well represented by the data set and adjustments are not necessary for variations in market conditions over the time period for which the comps were collected. Location - Comp #1 is much further north in the Crestview community but this is offset by the fact that it fronts directly along a major thoroughfare. Comps 4 and 5 are adjusted positively because of being more outlying and/or along more poorly improved roads. Comp #2 is adjusted negatively because it has much direct frontage and exposure along a major thoroughfare. Comps 3 and 6 are rated similar, being in or near highly popular residential areas. Site Area The selected unit of comparison (price/acre) is adequate in account for size variation in this data set and no other adjustments are necessary for size. Frontage / FF / SF/FF We utilize a frontage ratio to reflect relative exposure to roadway frontage and to evaluate shape in relation to roadway frontage. Comparable 1 is long and narrow, with much less frontage, as reflected by its lower ratio. As a result, comp 1 is adjusted positively. Similarly, comps 3 and 5 have only limited frontage and are adjusted positively, as reflected by their lower ratios. The other comps are sufficiently similar to the subject in this regard. Corner/Interior The subject site has dual access, which is rated similar to a minor corner location. Those comps with only interior access are adjusted positively. Land Use/Zoning Adjustments are applied as necessary to account for allowable density variation under the land use regulations pertinent. Utilities - All necessary utilities are available to the subject and all of the comparables, thus, no adjustment required. Shape/Utility We have considered and account for shape and utility in our assessment and consideration of the frontage ratio category of comparison. 55

Encumbrances Like the subject, comps five and six are partially encumbered with easements. As we are first appraising the parent tract (before imposition of the sewer easement), positive adjustment is applied. Topography - The comps are similar to the subject in this regard and adjustments are not required for this category of comparison. Land Value Analysis - The comps indicate an adjusted unit value range of from $97,826/acre to $140,449/acre and average $121,248/acre. All of the comps provide good comparisons for the subject, especially after accounting for dissimilarities in the adjustment process. However, we give greater weight to those comps considered to be in the more dynamic markets (comps #2 & #3) and less consideration to those in the more outlying markets (comps #1 and #4), giving us a weighted mean of a rounded $122,800 per acre. Applying this unit value to the site area of 14.25 acres within the parent tract reveals renders a market value opinion of the subject land at $1,749,900, which we round to $1,750,000 R. PARENT TRACT LAND VALUE ESTIMATE: $1,750,000 56

DESCRIPTION OF THE PART ACQUIRED The proposed acquisition is a 20 wide permanent easement that traverses the interior roadways Carlos Drive and Valdez Lane. The easement shall extend into perpetuity with the easement holder having the right to utilize the described property for the maintenance, operation, alteration, and ingress and egress to the subsurface sewer lines. The total easement area is approximately 16,781 SF or 2.70% of the total parent parcel area. Please refer to the site sketch shown previously for a complete delineation of the property boundaries pertaining to the easement and remainder parcel. The part acquired is through land that is reasonably level and the soils contained within this easement area are well-drained and conducive for development. There are no improvements located within the proposed easement area, other than those associated with the existing roadways. Any minor site improvements erected in the future by the owner in the area of acquisition are to be restored by the utility company, in the event of future maintenance. The owner would not be allowed erect structural improvements in the specified area but would not normally do so any way, because the easements are within the streets. The extensive investment in providing for the existing streets will facilitate redevelopment of the property in a multi-family fashion and there would be little or no benefit in rerouting the existing streets within the project. 57

VALUATION OF THE PART ACQUIRED We are valuing the rights associated with a permanent 20 sewer easement. An easement is defined as an interest in real property that conveys use, but not ownership. Furthermore, there is a vertical division of physical rights associated with real estate, i.e. subsurface, surface, and air. The rights being acquired for the utility easement are associated with subsurface use, although the surface is being slightly impacted as well due to limitations being placed upon it to insure maintenance and access to the subsurface. Continued use by the owner for site improvements will be permitted and such improvements will be replaced by the utility provider, if disrupted, during any future maintenance operations. The value estimate for the proposed utility easement will be estimated based on a percentage of the full fee value, as discussed below. We have previously estimated the value of the parent tract at $122,800 per acre. The impact of the easement is diminished by its location within existing street right of way, within an area not typically utilized for structural improvement purposes. Additionally this is an area that is already encumbered by the existing street right-ofway. These existing streets facilitate the existing development and would facilitate redevelopment. The streets are expensive to construct and it would not make sense to reroute them. It is easy to see that the installation of subsurface piping produces a relatively low impact on the parent parcel s utility. Hence, it is apparent that the bundle of rights associated with ownership will still be held predominantly by the property owner. Use of street right-of-way for utility lines is very common and such easements are often ignored entirely by purchasers, who understand the benefits and necessity for the provision of utilities in urban environments, so long as such easements are properly positioned. Such easements typically produce no impact or reduction in property value. Nevertheless, rights are being acquired and to value such rights we must address the 58

task of a minute division of rights, to a micro perspective, often beyond the influence of price. We must also recognize that the easement is running through the middle of the property for some distance and will place some design limitations upon the property for redevelopment, requiring that vertical building improvements be placed east, west, and north of the sewer line. While this creates some imposition, we recognize that street access through the remainder will be necessary for redevelopment, particularly in confluence with the access from Racetrack Road. With this in mind, allocating the bundle of rights between the easement and the remaining fee position, we estimate an apportionment of 50% to the rights of the utility easement and 50% to the property owner; thus, we reconcile at $61,400 per acre (50% x $122,800 R ) for the rights associated with the proposed 20 permanent utility easement. With this in mind, our valuation analysis computes as follows: Easement Acquired: Valuation of Property in Taking $23,700 R" (0.385239 acre x $61,400/AC) VALUE OF REMAINDER AS A PART OF THE WHOLE PROPERTY The subject property (land only) was valued at $1,750,000 before". The value of the permanent easement was $23,700. Thus, the valuation of the remainder as a part of the whole property is $1,726,300 ($1,750,000 less $23,700). Site improvements are not valued in the part acquired because the contractor has agreed to replace any disrupted site improvements with like-kind construction. Site improvements within the area of the acquisition are limited primarily to asphalt. 59

PURPOSE OF APPRAISAL OF REMAINDER AFTER THE ACQUISITION The purpose of the remainder appraisal is to estimate the market value of the remainder uncured. The function is to compare the remainder value estimate with the value of the remainder as a part of the "before" tract to determine whether there is any reduction (damage), or enhancement (special benefit) as a result of the acquisition. The remainder valuation assumes the proposed construction has been completed according to the construction plans and is open for public use. APPRAISAL PROBLEM The appraisal problem for the remainder valuation is to consider the impact of the easement on the remainder property that runs through the middle of the parcel for some distance. The easement itself encumbers 16,781 SF (2.70%) of the remainder tract area. The land area within the easement cannot be utilized for structural building improvements; however the easement is within a private street right-of-way. The utility provider will be responsible for any current or future disruption of site improvements (asphalt) placed in this area. The appraisal problem is to examine and value the remainder property given its new characteristics. We will consider all aspects of the remainder property including physical factors, land development requirements, utility and other pertinent factors in our evaluation of the remainder. 60

DESCRIPTION OF REMAINDER The description of the remainder tract is sufficiently similar to the description of the parent tract in regards to site area, road frontage, configuration, topography, access, flood zone, utilities, and soil composition. The only difference is that a 20 permanent utility easement now runs vertically through the property the middle of the southern portion of the property, then westward to the west property line (see exhibit on page 10). The parent parcel will contain the same overall site area. The street through the middle of the property will likely always be retained because it is in line with the 50 access route that comes into the property, perpendicular from Racetrack Road. It would not be sensible to terminate the access from Racetrack Road. Additionally the property is of ample width (from 482.2 to 642.32 ) such that ample land for development will exist on either side of a center access route. Given the substantial sums already invested in establishing this street right-of-way, we cannot easily envision situations in which its use would be terminated. Quite the contrary, we see the center line as facilitating the existing development and future redevelopment. As described earlier, the easement is subterraneous and positioned out of site, under the asphalt of the existing center street right of way. Because the full use of this street right-of-way will still be available to the owner, the acquisition has not substantially altered the physical characteristics of the parent site. ZONING, LAND USE PLAN, CONCURRENCY Please refer to the prior discussion of the zoning and land use planning codes. The zoning, future land use, and concurrency issues for the remainder parcel are the same as for the parent parcel. 61

EFFECT OF ACQUISITION ON REMAINDER UNCURED The easement presents minimal adverse consequence to the remainder and relatively little impact upon the remainder property as a result of its presence. The existing use is not affected at all. Potential redevelopment is not affected substantially because the easement is beneath the street right-of-way congruent to the access from Racetrack Road, which means this street will likely be retained for access during redevelopment as well as for the existing use. However, we do recognize that the versatility of development is reduced slightly due to the need to design vertical construction around the permanent easement. This places limitations on the remainder property that did not exist in the before condition. Additionally, to some degree, the easement segments off a smaller part of the tract in the southwest corner, from the bulk of the remainder tract. Because of the easement, this segmented portion of the remainder could not be connected directly with vertical building areas to (vertical) improvements constructed on the rest of the remainder parcel. HIGHEST AND BEST USE The physical characteristics of the remainder property are essentially the same as for the parent tract. The remainder tract retains sufficiently similar size, road frontage, exposure and access as described in the before. Hence, the balance of the Highest and Best Use analysis remains as stated for the parent tract. This includes legally permissible, financially feasible and maximally productive issues. As in the before, the highest and best use for the remainder tract is deemed to be redevelopment for multifamily purposes. We are of the opinion that such redevelopment can be easily designed around the subterraneous easement without adverse consequence, but we do recognize that the versatility of design is diminished somewhat as a result of the imposition of the easement. 62

APPROACHES TO VALUE USED AND EXCLUDED As with the before analysis, our appraisal of the remainder property utilizes the Sales Comparison approach to value. LAND VALUATION FOR REMAINDER Considering the value of the remainder, we note that much of our structure and format pertaining to the valuation of the remainder property remains unchanged from the prior analysis of the parent tract. Revisiting our sales comparison grid presented earlier in this report, all adjustments are exactly the same as for the parent tract except with regard to the imposition of an easement. The modification of this adjustment is illustrated in the re-presentation of our adjustment grid, as shown below: 63

ITEM Location Prox to Subject Sales Price SUBJECT N/S of Racetrack Rd N/A N/A Site Area (Ac) 14.25 Price/SF N/A Property Rights Fee Simple Similar Similar Similar Similar Similar Similar Adjusted Price/Ac N/A Financing Cash or Equiv Similar Similar Similar Similar Similar Similar Adjusted Price/Ac N/A Conditions of Sale Arm's Length Similar Similar Similar Similar Similar Neg. Allow. -5% Adjusted Price/SF N/A Buyer Expenditures None Similar Similar Similar Similar Similar Similar Adjusted Price/Ac N/A Time/Mkt Conditions Jan-12 Apr-11 May-11 Sep-10 Mar-11 May-09 Current Adjusted Price/Ac N/A Location N/S of Racetrack Rd Offsets Primary Exp. -25% Similar Inferior 15% Inferior 25% Similar Site Area (Ac) 14.25 5.29 5.99 8.45 2.51 3.47 10.04 Frontage Good Good Good Limited Inferior Good Good FF 1,827 300 5% 955 55 5% 325 135 830 FF/Ac 128 57 159 7 129 39 5% 83 Corner/Interior Dual Access Interior 5% Dual Access Interior 5% Dual Access Interior 5% Interior 5% Zoning & Density R-2; 9.4/Ac; 16/Ac C-1, City; 6.8/Ac 5% CC; 8/Ac 5% MU; 20/Ac NI; 8/Ac 5% C-1, 25/Ac -5% R3, 18/Ac Utilities All Avail. All All All All No sewer 10% All Shape/Utility Irregular Rect./Avg. Irreg./Avg. Irreg/Avg. Rect./Avg. Sl. Irreg/Avg. Irreg/Avg. Encumbrances Sewer Easement None -10% None -10% None -10% None -10% Access Esmt Powerline Topography Level, Uplands Similar Similar Fill/Offst Ret. Similar Similar Similar Net Phys Adj % 5% -30% 0% 10% 40% 5% Adjusted Price/Ac $110,260 Relative Weight 100% Weighted Mean $111,461 LAND SALE 1 Ferdon Blvd 18 Miles N $450,000 5.29 LAND SALES COMPARISON GRID Hammock Square Dr 60 Miles SE $1,078,900 8.45 $85,066 $166,945 $127,680 $85,066 $85,066 $85,066 $85,066 $85,066 LAND SALE 2 Emerald Coast Pkwy 14 Miles SE $1,000,000 5.99 $166,945 $166,945 $166,945 $166,945 $166,945 LAND SALE 3 LAND SALE 4 $127,680 $127,680 $127,680 $127,680 $127,680 Sea Croft 25 Miles SE $270,000 LAND LISTING 6 Lakes Dr 36 Miles NE $950,000 10.04 $94,622 $94,622 $94,622 $89,890 $89,890 $89,890 $89,319 $116,861 $127,680 $118,327 $114,986 $94,385 15% 20% 20% 15% 15% 15% $13,398 $23,372 $25,536 $17,749 $17,248 $14,158 2.51 $107,570 $107,570 $107,570 $107,570 $107,570 $107,570 LAND SALE 5 Untreiner Ave 39 Miles E $285,000 3.47 $82,133 $82,133 $82,133 $82,133 $82,133 $82,133 64

The adjustments are modified to reflect that the subject property is now encumbered with an easement as are comps 5 and 6. This produces a range of value for the remainder of from $89,319 per acre to $127,680 per acre and an average of $110,260 per acre. Applying the same weighting as used in the before analysis, giving more weight to comps 2 and 3, we arrive at a value opinion for the remainder property of $111,500 per acre. This results in a value of $1,588,875 when applied to the remainder area, or $1,589,000, rounded. Land Value Estimate After : $1,589,000 SUPPORT FOR DAMAGES/NO DAMAGES TO THE REMAINDER The value of the remainder as part of the whole property was $1,726,300. The value of the remainder was $1,589,000, thus indicating damages to be sustained by the acquisition in the amount of $137,300. The damages are attributed to the positioning of the subterraneous utility line through the middle of the property, resulting in the lessening of design opportunities for redevelopment of the property. COST-TO-CURE No costs to cure have been cited because the engineers have informed us that they will replace any disruption of the asphalt (or other site improvements) with likekind construction during the installation of the sewer line. 65

SPECIAL BENEFITS There are no special benefits applicable to the remainder property. SUMMARY OF VALUES 1. Before Property (Land Only) $ 1,750,000 2a. Part Acquired - Land $ 23,700 2b. Part Acquired - Improvements $ - 3. Remainder as Part of the Whole (Land Only: 1-2a) $ 1,726,300 4. Remainder Appraised (Land Only) $ 1,589,000 5. Severance Damages $ 137,300 SUMMARY OF TOTAL COMPENSATION Part Acquired (2a + 2b) $ 23,700 Total Compensable Damages (7) $ 137,300 Net Cost-to-Cure $ - Total Compensation $ 161,000 66

APPRAISAL OF TEMPORARY CONSTRUCTION EASEMENT PURPOSE OF APPRAISAL - The purpose of the appraisal is to provide an opinion of market value of the proposed temporary construction easement (TCE). DEFINITION OF FAIR RENT AND JUST COMPENSATION - Just compensation in the case of a temporary easement or fair rent is the amount of money reasonably expectable for the right to the agreed use of the property as established by competition in the rental market. If market information is unavailable, it is the amount of money that will amortize the remaining capital investment plus provide a fair rate of return during the remaining useful life of the property. PROPERTY RIGHTS/INTEREST APPRAISED - The rights appraised are those associated with a temporary construction easement. PERIOD OF EASEMENT - The easement shall extend for 2.5 years with the easement holder, City of Ft. Walton Beach/Okaloosa County, having the right to utilize the described property for temporary construction purposes. DESCRIPTION OF EASEMENT - The temporary construction easement (TCE) consists of an irregular-shaped parcel, which is located along the west side of the permanent easement. A complete delineation of the temporary easement boundaries was shown previously on a sketch in the exhibits section of this report. The easement is 10 wide. The total easement land area is 8,570 SF per a drawing provided to us by Hatch Mott MacDonald, and this will encompass 1.42% of the remainder tract area. There are no building or site improvements located within the TCE. The area of the easement acquisition will be employed to provide room for installation of the sewer line within the bounds of the permanent easement. Access to the remainder over the easement area is to be permitted for the duration of the easement. 67

ANNUAL ECONOMIC RENT - We are of the opinion that the land valuation utilized for the parent parcel is also applicable to the TCE. As set forth earlier in this report, we have estimated the unit value of parent tract, of which the temporary construction easement is a part, at $122,800 per acre. Our evaluation of the easement will be based on the total return to the site as extracted from current leases of similar properties within the area. An attempt at locating leases of easements on comparable properties was also conducted; however, our search was unproductive and our valuation of the easement will be based on total return to the site rather than by an assignment of a ground rental rate. We have included three ground leases of properties within the addenda. All indicate total rates of return ranging from 3% to 10.5%. These rates are based on gross leases with a similar basis applicable to the easement area. All three rates are given weight as we reconcile to the upper end of the range at 10.00%. Applying a rate of return of 10.00% to the value of the land in the easement $24,160 (0.19674/acre @ $122,800/AC) the annual economic rent computes to $2,416. Vacant land leases are typically paid in advance and on a monthly basis with the monthly economic rent computing to $200 (R). OPINION OF MARKET VALUE - The income from the easement will be discounted over a 60 month period utilizing the 6-month "treasury bill" discount, plus three points for management, risk and other elements. The 6-month treasury bill discount rate was 0.070% as of December 1, 2011. Allowing a 3.0% point addition for the factors stated indicates an appropriate discount rate of 3.1% R. This discount rate will be applied in deriving the present value of the economic rent for the temporary construction easement area. The factor is applied based on payment received in advance. With this in mind, our computations follow: 68

ECON. RENT/MO. x PRESENT VALUE FACTOR = PRESENT VALUE INCOME $200 x 28.905638 = $5,800 OPINION OF MARKET VALUE FOR LAND LEASE TO BE ACQUIRED: $5,800 R VALUE OF IMPROVEMENTS WITHIN THE EASEMENT - As stated previously, there are not building improvements located within the TCE. Any site improvements disrupted in the TCE are to be replaced by the city/county with like-kind construction. DESCRIPTION OF REMAINDER AND COST-TO-CURE IF ANY - With the exception of the area of acquisition for the temporary construction easement, the description of the remainder is basically the same as that of the parent tract. According to our land planner consultant, the proposed construction plans indicate no significant changes in elevation at the proposed roadway, and the TCE is to be utilized to blend the subject s driveway to the new roadway. Ingress/egress across the TCE to the remainder will not be restricted during the construction period. OPINION OF MARKET VALUE OF THE TEMPORARY CONSTRUCTION EASEMENT - The value of the temporary construction easement equates to the value of the land lease, $5,800. SUMMARY OF TOTAL COMPENSATION FOR TCE PARCEL Part Taken $5,800 Total Compensable Damages -0- Cost-to-Cure -0- Total Compensation $5,800 69

ASSUMPTIONS AND LIMITING CONDITIONS 1. This is a Summary Appraisal Report which is intended to comply with the reporting requirements set forth under Standard Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice for a Summary Appraisal Report. 2. No responsibility is to be assumed for legal or title considerations. Title to the property is assumed to be good and marketable unless otherwise stated in this report. 3. The property is appraised free and clear of all liens and encumbrances unless otherwise stated in this report. 4. Responsible ownership and competent property management are assumed unless otherwise stated in this report. 5. The information furnished by others is believed to be reliable. However, no warranty is given for its accuracy. 6. All engineering is assumed to be correct. Any plot plans and illustrative material in this report are included only to assist the reader in visualizing the property. 7. It is assumed that there are no hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for such conditions or for arranging for engineering studies that may be required to discover them. 8. It is assumed that there is full compliance with all applicable federal, state, and local environmental regulations and laws unless otherwise stated in this report. 9. It is assumed that all applicable zoning and use regulations and restrictions have been complied with, unless a nonconformity has been stated, defined, and considered in this appraisal report. 10. It is assumed that all required licenses, certificates of occupancy or other legislative or administrative authority from any local, state, or national governmental or private entity or organization have been or can be obtained or renewed for any use on which the value estimates contained in this report are based. 11. Any sketch in this report may show approximate dimensions and is included to assist the reader in visualizing the property. Maps and exhibits found in this report are provided for reader reference purposes only. No guarantee as to accuracy is expressed or implied. 12. It is assumed that the utilization of the land and improvements is within the boundaries or property lines of the property descried and that there is no encroachment or trespass unless otherwise stated in this report. 70

ASSUMPTIONS AND LIMITING CONDITIONS CONT D. 13. The appraiser is not qualified to detect hazardous waste and/or toxic materials. Any comment by the appraiser that might suggest the possibility of the presence of such substances should not be taken as confirmation of the presence of hazardous waste and/or toxic materials. Such determination would require investigation by a qualified expert in the field of environmental assessment. The presence of substances such as asbestos, urea-formaldehyde foam insulation, or other potentially hazardous materials may affect the value of the property. The appraiser's value estimate is predicated on the assumption that there is no such material on or in the property that would cause a loss in value unless otherwise stated in this report. No responsibility is assumed for any environmental conditions, or for any expertise or engineering knowledge required to discover them. The appraiser's descriptions and resulting comments are the result of the routine observations made during the appraisal process. 14. Unless otherwise stated in this report, the subject property is appraised without a specific compliance survey having been conducted to determine if the property is or is not in conformance with the requirements of the Americans with Disabilities Act. The presence of architectural and communications barriers that are - structural in nature that would restrict access by disabled individuals may adversely affect the property's value, marketability, or utility. 15. Any proposed improvements are assumed to be completed in a good workmanlike manner in accordance with the submitted plans and specifications. 16. The distribution, if any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings must not be used in conjunction with any other appraisal and are invalid if so used. 17. Possession of this report, or a copy thereof, does not carry with it the right of publication. It may not be used for any purpose by any person other than the party to whom it is addressed without the written consent of the appraiser, and in any event, only with proper written qualification and only in its entirety. 18. Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraiser, or the firm with which the appraiser is connected) shall be disseminated to the public through advertising, public relations, news sales, or other media without prior written consent and approval of the appraiser. 71

CERTIFICATION We certify that, to the best of our knowledge and belief: 1. The statements contained in this appraisal report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions. 3. We have no present or prospective interest in the property that is the subject of this report and we have no personal interest with respect to the parties involved. 4. We have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment. 5. Our engagement in this assignment is not contingent upon developing or reporting predetermined results. 6. Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 7. Our analyses, opinions, and conclusions were developed, and this report has been prepared in conformity with the Uniform Standards of Professional Appraisal Practice. 8. We have made a personal inspection for the property that is the subject of this report. 9. No one provided significant professional assistance to the persons signing this certification. 10. This appraisal was not based on a requested minimum valuation, a specific valuation, or the approval of a loan. 11. The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Appraisal Institute s Code of Professional Ethics and Standards of Professional Appraisal Practice, which include the Uniform Standards of Professional Appraisal Practice. 12. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 13. As of the date of this report, R. Shawn Brantley, MAI, has completed the continuing education program of the Appraisal Institute. 14. We certify that we have not appraised this property within the previous three years. R. Shawn Brantley, MAI, CCIM State-Certified General Appraiser Florida #RZ289 72

AFFILIATIONS/DESIGNATIONS: QUALIFICATIONS AS AN APPRAISER R. SHAWN BRANTLEY, MAI, CCIM, SRA MAI Designation: Commercial appraisal designation awarded in 1994, Member #10514 CCIM Designation: Commercial investment designation awarded in 1999, Member #8500 SRA designation: Residential appraisal designation awarded in 1990, Member #42488 State Certified in Florida (State-Certified General Appraiser, RZ289) and Alabama (State Certified General Real Property Appraiser, #G00419) to appraise all types of real property. FHA Appraiser: Member of Federal Housing Administration's Fee Appraisal Panel, 1986-1994. VA Appraiser: Member of Veteran's Administration's Fee Appraisal Panel, 1993-2004. Realtor: Member of Local Association, Florida Association, and National Association of Realtors. Professional Service: Past President of Appraisal Institute for 1997, Admissions Chair for Appraisal Institute in 1996, Have served extensively on Appraisal Institute s Regional Ethics & Counseling Panel, Have serve extensively on commercial (MAI) & residential (SRA) candidate experience review committees & professional standards committees for the Appraisal Institute. Past President of Board of Realtors in 1991, Have served on Realtor s board of directors for many years, Past chairman of Realtors grievance, professional standards, long-range planning & awards committees. EXPERIENCE: Over 20 Years of Experience: Owner/President of Brantley and Associates Real Estate Appraisal Corp. from 2004 to present. Owner/President of Martin, Brantley & Associates, Inc. from 1999-2004. Owner/Vice President of Martin, Brantley & Associates, Inc. from 1997-1998. Owner/President of Brantley Real Estate, Inc. from 1990-1996. Employed as Staff Appraiser with Presley Real Estate, Inc. from 1984-1989. Court Experience: Have testified in proceedings pertaining to values and damages on more than 100 occasions, including order of takings for eminent domain, jury trials, divorce cases, partition suits, bankruptcy matters, etc. Varied Experience: Experience includes appraisals in the following property types: Agricultural, Apartments, Automotive, Borrow Pits, Cemeteries, Churches, Commercial properties, Condemnation, Condominiums, Convenience stores, Cropland, Dental facilities, Distribution plants, Easements, Eminent domain matters, Extended stay motels, Farms, Fast food facilities, Freshwater marsh land, Golf courses, Greenhouses, Hair salons, Homes up to over 9,000SF, Hotels, Industrial properties, Land tracts up to 5,300 acres, Leasehold interests, Liquor stores, Motels, Medical facilities, Manufacturing plants, Night Clubs, Offices, Partial Interests, Restaurants, Retail, Right-of-way, Self-storage facilities, Service stations, Shopping centers, Subdivisions, Supermarkets, Timberland, Warehouses, Waterfront property, Wetlands, etc. Geography of Experience: Most extensive experience is within the Florida counties of Escambia, Santa Rosa, Okaloosa, Walton, & Bay, and the Alabama counties of Baldwin, Mobile, and Escambia. Other Experience: Employed by ETS (Educational Testing Service) as a test question writer & reviewer for Florida's examination for the state certification of real estate appraisers. Selected by the Florida Dept. of Revenue as participant in its bi-annual Florida Real Estate Value Survey. Selected by University of Florida, Institute of Food & Agricultural Sciences, as participant in its bi-annual survey of North Florida Land Values. 73

Partial List of Prior Clients: Law Firms: Balch & Bingham, LLP; Borowski & Duncan; Chase, Quinnell & Jackson; Clark, Partington, Hart, Larry, Bond & Stackhouse; Greenburg, Traurig; Johnson, Green & Miller; Lindsay, Andrews & Leonard; Litvak, Beasley, Wilson; Locklin, Jones & Saba; Lyons, Pipes & Cook; Moore, Hill & Westmoreland; Shell, Fleming, Davis & Menge; Thompson, Garrett & Hines; Werre & Fitzgerald Banks: Bank of America, Bank of Pensacola, BB&T, Beach Community Bank, Hancock Bank, Peoples 1st, Compass Bank, 1st Nat'l Bank of Brewton, 1st Nat'l Bank & Trust of Crestview, 1st Nat'l Bank of Florida, Regions Bank, SunTrust, Vanguard Bank & Trust Company of Ft. Walton, Wachovia, Whitney Bank. Governmental Agencies & Political Subdivisions: City of Pensacola, City of Milton, City of Destin, City of Gulf Breeze, Escambia County, Florida Department of Environmental Protection, Florida Dept. of Transportation, Santa Rosa Bay Bridge Authority, Santa Rosa County, Santa Rosa County School Board, U.S. Army Corps of Engineers, U.S. Department of Housing & Urban Development, U.S. Department of Veterans Affairs. Corporate Clients: Associates Relocation, American Cyanamid, Baptist Hospital, Baskerville-Donovan, Inc., Blue Sky Timber, LLC, Chicago Title Insurance Co., Coldwell Banker Relocation, Education Credit Union, Elliot-Cooke & Co. CPA's, Equitable Relocation, Farm Credit, Figg Engineers, Inc., General Electric Corp., Gulf Power Co, International Paper Corporation, Medical Center Clinic, P.A., Monsanto Employees Credit Union, Moreland-Altobelli Assoc., Inc., Pace Water System, Inc., Sacred Heart Hospital, Saltmarsh, Cleveland & Gund, CPA s, Southern Farm Bureau Casualty Insurance Co, Teachers Federal Credit Union. EDUCATION: M.S. Real Estate, University of St. Thomas, 2007. B.S., Finance & Investment Management, University of Alabama, 1984. Over 1,000 classroom hours of specialized appraisal education specific to real estate appraisal: COURSE DESCRIPTION DATE COMPLETED HOURS SPONSOR Advanced Appraisal Review 06/10 17 Florida Department of Transportation Supervisor and Trainee Appraiser 06/10 3 Florida Department of Transportation USPAP Update and Core Law 06/10 7/3 Florida Department of Transportation Aviation Valuation 01/09 2 Pensacola Regional Airport USPAP Update and Core Law 04/08 7/3 Florida Department of Transportation Supervisor & Trainee Rules & Roles 04/08 3 Florida Department of Transportation Advanced Appraisal Review 04/08 17 Florida Department of Transportation Appraisal of Sovereign Submerged Lands 03/08 06 Dept. of Environmental Protection Valuation of Conservation Easements 01/08 31 Appraisal Institute Using the HP12C Calculator 11/06 07 Appraisal Institute Appraisal of Nursing Facilities 11/06 07 Appraisal Institute Analyzing Operating Expenses 11/06 07 Appraisal Institute Market & Feasibility Analysis 08/06 40 University of St. Thomas National USPAP 04/06 07 McKissock Florida Laws & Regulations 04/06 03 McKissock Advanced Appraisal Topics 01/06 40 University of St. Thomas Business Practices & Ethics 12/05 08 Appraisal Institute Statistical Analysis for Appraisal 08/05 40 University of St. Thomas USPAP 10/04 07 McKissock Legal Issues in Valuation 08/04 40 University of St. Thomas Effective Communication 08/04 40 University of St. Thomas Uniform Standards for Federal Land Acq. 03/04 16 Appraisal Institute Timberland Appraisal Methods 02/04 12 Appraisal Institute Florida State Law for Real Estate Appraisers 11/03 03 Appraisal Institute Effective Appraisal Writing 08/03 07 Appraisal Institute USPAP 11/02 04 Bert Rodgers Communicating the Appraisal 11/02 04 Bert Rodgers 74

EDUCATION: Neighborhood Analysis 11/02 04 Bert Rodgers Residential Subdivision Analysis 11/02 05 Bert Rodgers Sales Comparison Approach 11/02 06 Bert Rodgers Appraisal Research and Analysis 11/02 04 Bert Rodgers Urban Land Economics 08/01 26 Univ. of St. Thomas USPAP Update 06/01 07 S. Vehmeier Uniform Standards & Prof. App. Practices 11/00 10 McKissock Factory-Built Housing 11/00 10 McKissock Automated Valuation Models 11/00 10 McKissock USPAP Core Law 08/99 07 NWF Ch. Appraisal Inst. Comp. Commercial Review 06/99 20 CCIM Real Estate Decision Analysis 01/99 30 CCIM Real Estate Market Analysis 09/98 30 CCIM Real Estate Financial Analysis 03/98 30 CCIM Standard of Professional. Practice C 04/98 15 Appraisal Institute USPAP Core Law for Appraisers 10/97 07 Appraisal Institute Condemnation Valuation 05/97 04 EC Ch. Appraisal Inst. Tomorrows Appraiser 10/96 04 Appraisal Institute Standards of Prof. App. Prac. A 1996 16 Appraisal Institute Tools for Better Appraising 1996 01 NWF Ch. Appraisal Inst. Complex Residential Properties 1995 07 Mid-S Al C Appraising FHA Insured Prop. 1995 07 Appraisal Institute Exp. Review Training Program 1995 04 NWF Ch. Appraisal Inst. Understanding Limited Appraisals 1994 07 Appraisal Institute Standards of Prof App Pract. B 1994 11 Appraisal Institute Standards of Prof App Pract. A 1994 15 Appraisal Institute USPAP Core Law Seminar 1994 07 NWF Ch. Appraisal Inst. Comp. Appraisal Workshop 1994 23 T. Whitmer Co USPAP/Environ. Hazards 1992 10 Real Estate Ed. Spec Litigation Valuation 1991 15 Appraisal Institute Adv. Income Capitalization 1989 15 Appraisal Institute State Cert. Real Est Appr Cs-II 1989 60 Bert Rodgers State Cert. Real Est Appr Cs-I 1989 60 Bert Rodgers Valuation & Report Writing 1988 48 AIREA/Univ. Florida Case Studies in RE Valuation 1987 48 AIREA/Univ. North Carolina Standards of Professional Prac 1987 28 AIREA/Texas Christian University Appl Residential Prop Valuation 1987 challenged SREA Capitalization Theory & Tech B 1987 challenged AIREA Capitalization Theory & Tech A 1986 challenged AIREA Basic Valuation Proc. (Exam 1A2) 1986 challenged AIREA Real Estate Appr Prin. (Exam1A-1) 1985 challenged AIREA Real Estate Brokers Course 1984 48 Bert Rodgers Principals of Real Estate (Fl431) 1984 60 University of Alabama Real Estate Finance (Fl 436) 1983 60 University of Alabama Real Estate Salesman's Course 1979 51 Bert Rodgers 75

ADDENDA 76

GENERAL AREA DATA Okaloosa County is located near the center of the panhandle of northwest Florida. The county is 24 miles wide and averages about 45 miles in length, as measured from the Alabama state line to the Gulf of Mexico. Okaloosa County contains approximately 936 square miles and approximately half of that is contained within the Eglin Air Force Base reservation. The county is essentially split in half by Eglin AFB and Choctawhatchee Bay. The southern part of the county along the Gulf of Mexico is primarily tourist oriented while the northern part depends heavily on agriculture. South Okaloosa County contains the incorporated towns of Cinco Bayou, Destin, Fort Walton Beach, Mary Esther, Niceville, Shalimar and Valparaiso as well as the smaller communities of Wright and Ocean City. This area is heavily developed along the gulf and extending north to the southern boundary of Eglin Air force Base, varying to a depth of from 0-10 miles inland. North Okaloosa County contains the County Seat of Crestview, the town of Laurel Hill, as well as the smaller unincorporated areas of Dorcus and Oak Grove. The area extending from Crestview north to the Florida/Alabama State line is largely rural. As previously stated, Crestview is Okaloosa s county seat. It lies 138 miles west of Tallahassee, 69 miles northwest of Panama City, and 45 miles east of Pensacola. 77

Crestview contains residential developments, shopping, and land area to continue growing. It has, as of July 2007, become the largest city in Okaloosa County. 1 There are four forces that have significant influence on property values in the region. They are listed as follows: ECONOMIC FORCES SOCIAL FORCES GOVERNMENTAL FORCES ENVIRONMENTAL FORCES The interaction of these forces influences the value of real property in the market. The regional analysis is presented with these factors in mind. Economic Forces: The analysis of economic trends will be confined to the local economy as most applicable to the subject of the appraisal. This category will evaluate trends in employment and housing trends within the County. Employment The largest employer in Okaloosa County is Eglin Air Force Base. Eglin is the largest Air Force base in the world, covers three counties and over 724 square miles of land and 123,000 square miles into the Gulf of Mexico. More than 20,000 jobs and $1.4 billion are tied directly to activities at Eglin Air Force Base, Hurlburt Field and Duke Field. The total economic impact of Department of Defense (DOD) activity in Okaloosa County is over $5 billion making it the largest employer since its inception in 1935 and making Okaloosa County the most Department of Defense dependant county. As well as active duty military, Eglin employs civilians as it is also comprised of laboratories, test sites and 10 auxiliary fields, including Duke and Hurlburt Fields. 2 Private Sector Employers are: Company Business Line Number of Employees Tybrin Corporation Engineering Analysis & Software Development 1,390 Resort Quest Real Estate Sales & Property Management 1,000 Fort Walton Beach Medical Center Full Service Hospital 912 L3/Crestview Aerospace Aircraft Manufacturing, Maintenance, & Modification 898 DRS Training & Control Systems Defense Electronics 811 InDyne, Inc. Range/Test Facilities; Security Systems; Multimedia 800 Sverdrup Technology/Jacob TEAS Engineering Services 650 North Okaloosa Medical Center Full Service Hospital 643 1 http://www.cityofcrestview.org/ 2 http://www.villageprofile.com/florida/crestview/05/topic.html 78

Okaloosa Walton College College & Professional School 600 Legendary Inc. Development/Retail 500 Industries providing employment are: Natural Resources & Mining 0.1% Construction 6.9% Manufacturing 5.5% Trade, Transport& Utilities 18.9% Information 2.4% Financial Activities N/D Professional & Business Services 13.8% Education & Health Services 9.6% Leisure & Hospitality 15.4% Other Services 3.4% Public administration 11.2% Unclassified 0.0% Industries Providing Employment Natural Resources & Mining Manufacturing Information Professional & Business Services Leisure & Hospitality Public administration Construction Trade, Transport& Utilities Education & Health Services Other Services The per capita income in Okaloosa County for 2006 was $37,497. 1 The per capita income has decreased from this time and was $29,940 in 2008. This decrease can be attributed to the recession our economy has been in since 2006. The rise of the 1 http://www.eflorida.com/profiles/countyreport.asp?countyid=27&display=all 79

unemployment rate in 2006 to record highs in 2010, shown in the graph below, can also be attributed to the recession. As we begin to come out of the recession we can expect future trends to be a fall in the unemployment rate and a rise in per capita income. Unemployment rate in Okaloosa County over last 20 years: Residential Sales Activity Okaloosa County is following the national trend and existing home sales have been declining to flat. 80

The mean price of a single family home in 2007 appears to be lower than the state average. The breakdown is as follows: Detached houses: $313,874 Here: $313,874 State: $334,342 In 3-to-4-unit structures: $136,731 Here: $136,731 State: $240,504 Townhouses or other attached units: $282,721 Here: $282,721 State: $258,333 In 5-or-more-unit structures: $505,337 Here: $505,337 State: $281,565 In 2-unit structures: $450,000 Here: $450,000 State: $289,450 Mobile homes: $40,178 Here: $40,178 State: $43,568 Estimated median household income in 2007: $55,543 up from $41,474 in 1999. The median contract rent in 2007 for apartments: $809 (lower quartile is $617, upper quartile is $1,012). The median monthly housing costs for units with a mortgage was $1,493, while the median monthly housing costs for units without a mortgage was $408. SOCIAL FORCES: This category is primarily concerned with population characteristics and demographics. A study of an area's population characteristics produces much information about the basic demand for real estate in that market. Following is regional and city data pertinent to that topic Population and Demographics: The population growth has continued at a steady pace consistent with the pace of the state of Florida s population growth since the 1950s. 81

Population growth in Okaloosa County Okaloosa County Florida Average 1920 1930 1940 1950 1960 1970 1980 1990 2000 2005 Population Trends in Okaloosa County: Population growth increased rapidly up until 2006 and has been on a flattening and declining trend since that time. The breakdown of population by incorporated areas is as follows: 82

Location Population in the year 2000 Cinco Bayou 377 Crestview 14,766 Destin 11,119 Fort Walton Beach 19,973 Laurel Hill 549 Mary Esther 4,055 Niceville 11,684 Shalimar 718 Valparaiso 6,408 Okaloosa County s 2008 population was 179,693, up from 177,838 in 2003 and 170,497 in 2000. The 2007 statistics estimates the median age for Walton County to be 36.1 years. There are approximately 78,593 households. The following chart exhibits basic demographic estimates for Okaloosa County. Demographic Estimates Okaloosa County US Per Capita Income $29,940 $27,446 Median Family Income $66,000 $63,211 Unemployed 9.10% 10.20% High school graduate or higher 91.00% 84.50% Bachelor's degree or higher 27.90% 27.40% Owner-occupied housing units 67.40% 67.10% Renter-occupied housing units 32.60% 32.90% Vacant housing units 19.20% 12% Median value of owner occupied homes $220,800 $192,400 Median Age (in years) 39 36.7 GOVERNMENTAL FORCES: This category addresses state and local government forces within the regional area. Type of Government: Okaloosa County is governed by a board of commissioners. Specified districts with some at large seats elect the commissioners. The board in turn appoints a county manager who oversees the day-to-day operations of the respective governments. 83

Building Codes/Zoning: The various cities of Cinco Bayou, Crestview, Destin, Fort Walton Beach, Laurel Hill, Mary Esther, Niceville, Shalimar, and Valparaiso in Okaloosa County all operate separate planning and zoning departments. The state of Florida has certain requirements before new development can take place. Under Florida s concurrency laws, an area must have adequate public facilities before new development may occur. All comprehensive plans across the state must include concurrency for roads, sanitary sewer, solid waste, drainage, potable water, parks and recreation, and mass transit, where applicable. Law Enforcement/Fire Department: Okaloosa County Sheriff Department and the respective City Police Departments provide adequate law enforcement within the immediate market area. There are both city and county level fire departments. Utilities: Okaloosa County is provided with electricity by Gulf Power Company and Choctawhatchee (CHELCO). Okaloosa Gas District provides the area with natural gas. Okaloosa County receives telephone service from Embarq, Cox Communications, and CHELCO. Water and Sewer Services are available through Okaloosa Water and Sewage and individual cities water management districts. Transportation - Florida Highways 90 and 98 provide east/west access to much of Okaloosa County, while Hwy. 83 and to a point Hwy 4 and 123 provide access north/south. Two of these main roads, Highways 90 and 85, intersect at Crestview. Interstate 10 parallels U.S. 90 and has exits at Holt and Crestview. The nearest commercial airports are Northwest Florida Regional Airport in Okaloosa County, Panama City-Bay County International Airport to the east, or Pensacola Regional Airport to the west. The nearest deep water ports are the Port of Pensacola and Foreign Trade Zone to the west and the Port of Panama City and the Foreign Trade Zone to the east. Taxes: The State of Florida has no personal income tax. Additionally, there is no sales tax on food, medicine, packaging, boiler fuels or inventories. Sales taxes targeted toward tourism (retail sales, rentals, transient living accommodations) comprise 65% to 70% of Florida's tax revenue. There is a corporate state income tax of 5.5%. The local ad-valorem taxes are held down, as sales taxes aimed at tourist provide substantial funds for the county. 84

Education Okaloosa County currently operates 58 schools with an enrollment of 31,126 students. 1 Various college level courses are offered at Niceville; Troy State University-Fl. Region, Hurlbert Field and Northwest Florida State College (formerly Okaloosa-Walton Community College). Vocational/technical schools within a 50-mile radius include Walton County Vo-Tech, Washington-Holmes Vo-Tech, and Crestview Vo-Tech. Health Care Numerous healthcare faculties exist in Okaloosa County including Crestview Community Hospital in Crestview, Fort Walton Beach Hospital Extended Care in Fort Walton Beach, Fort Walton Beach Medical Center in Fort Walton Beach, HSA Gulf Coast Hospital in Fort Walton Beach, North Okaloosa Medical Center in Crestview, Twin Cities Hospital in Niceville and US Air Force Regional Hospital in Fort Walton Beach. 2 ENVIRONMENTAL FORCES: Environmental forces relate to the characteristics of a property's geographic location. Topography/Soil: Okaloosa County is located on the Gulf Coastal Plain, which generally consists of level and flat land. The soils are mostly of the sandy loam nature and are generally well suited for buildings, roads and other common urban improvements. Recreational Opportunities: Beaches/Waterparks/Boardwalks, Camping, Canoeing/Kayaking/Rafting, Golf, Hunting and Fishing (private and charter), Scuba Diving/Snorkeling, Shopping/Dinning, Watersports/Boating. Historical Points of Interest: Air Force Armament Museum, Camp Walton School House, Carver-Hill Museum, Destin Fishing and History Museum, Heritage Museum of NW Florida, Indian Temple Mound Museum and Park Cultural Events/Festivals: Amphitheater, Arts Center of Okaloosa-Walton College, Arts and Crafts Festivals, Emerald Coast Science Center, Northwest Florida Ballet Academy, Seafood Festivals, World Cobia Fishing Tournament Regional Resources: Okaloosa County s most valuable resources are its white sandy Emerald Coast beaches. 4.5 million people visit the beaches of Okaloosa County annually. Tourism measures $1,000,000,000 annually in Okaloosa County and provides 35,000 job opportunities. There are also extensive petroleum deposits 1 http://www.okaloosaschools.com/okaloosaschools/ 2 http://florida.hometownlocator.com/features/cultural,class,hospital,scfips,12091.cfm 85

offshore in the Gulf of Mexico. However, at the current time, only exploratory drilling has been permitted. The future impact of this resource is questionable as the prospect of full production drilling is vehemently opposed by environmentalists and local and state government. The skepticism of state officials on the issue of offshore drilling has recently been justified by BP s oil spill in the Gulf of Mexico. The crisis started when an offshore oil rig exploded and sank in the gulf on April 20, 2010. The incident ruptured the oil well and has caused a blowout, or an uncontrollable spill. The well has since spewed millions of gallons of crude oil into the Gulf of Mexico and continues to spew oil to this day (May 13, 2010). The environmental and economical repercussions of this spill could be catastrophic. The oil spill has imperiled the fishing industry and threatens marine life along the gulf coast. Dead dolphins, fish, birds, and turtles have already started to wash up on the beaches. The realization that the oil slick could make landfall on the beaches of Okaloosa County has reminded residence of how important the beaches and waterways are to their economy. Climate: Okaloosa County is located in a generally warm climate, typical of the region along the upper Gulf Coast. The average temperature in January is 52 degrees and in July is 83 degrees. High winds, tropical storms or hurricanes have occurred in late summer and in early fall. Hurricanes: The Atlantic hurricane season extends from June to November. Statistically speaking Okaloosa is hit or brushed by a hurricane about every 3 years. In 2004 and 2005 the area was ravaged by category 3 hurricanes Ivan and Denis. These storms created in the general public an awareness of the vulnerability of this hurricane prone area. Due to these natural disaster frequently targeting the Northwest Florida area multiple hurricane shelter, evacuation planning guides and assistance programs have been formed to support local residents in preparing for and dealing with the outcomes of these storms. SUMMARY: Okaloosa County remains an evolving area, traditionally dependent on tourism and an extensive military presence. The county also has natural resources, affordable housing, and a growing, young workforce, all of which provide a good foundation for future growth. We conclude that it is an economically viable environment with demand levels for affordable housing within this general area sufficient for an operative market, but clearly at a slower pace than surrounding counties. 86

LOCATION MAP OF SUBJECT AND COMPARABLE LAND LEASES 87

Land Lease No. 1 Property Identification Record ID 4315 Property Type Commercial, Land Lease/Open Storage Property Name Land Lease Address Land Lease - 8125 Pensacola Boulevard, Pensacola, Escambia County, Florida Location West side of Pensacola Blvd. Tax ID 22-1S-30-2201-000-002 Date Inspected 2/15/10 Land Use Code Repair Service Present Use Commercial Land Lease Data Lessor Lessee Sale History Verification Lease Price King, Lonnie Unknown None in previous 3 years Lonnie King, Owner; (850) 572-6090, February 15, 2010; Other sources: Public records, inspection, Confirmed by R. Shawn Brantley, MAI $1,000 /mo. Land Data Zoning C-2, Commercial, C-2 Topography Level, Cleared: see soil comments Utilities All available; OH Power Dimensions 364.72'X180.26'X332.65'X40.56'X200.45' Shape Irregular Landscaping Gravel fill Parking Adequate Rail Service Abuts RR/No spur Fencing Minor Flood Info Zone X, per 12033C0295 G, Dated 9/29/06. Future Land Use MU-1 Highest & Best Use Commercial Development Encumbrances None noted Depth 190 Land Size Information Gross Land Size Front Footage 1.620 Acres or 70,567 SF 365 ft Total Frontage: 365 ft WS Pensacola Blvd Indicators Lease Price/Gross Acre $617 Lease Price/Gross SF $0.01 Lease Price/Front Foot $3 88

Land Lease No. 1 (Cont d) Remarks The property is primarily Escambia Fine Sandy Loam (0 to 2% slope). This is a nearly level to slightly sloping soil that is poorly drained. Approximately 5% of the subject is comprised of Bonifay Loamy Sand (0-5% slope). This is a well-drained soil located along the north boundary of the subject. We note that the property has benefited from past fill-gravel over much of the subject and the presence of drainage swells along Pensacola Boulevard. The drainage appeared adequate during our observation of the property. Observation of the improvements in the vicinity would indicate there is sufficient soil bearing capacity to support most improvements typically found in commercial areas of this nature. The owner has informed us that he leases the land on a month-to-month basis for $1,000 per month on a gross basis. We valued this property at $410,000 on February 15, 2010, indicating a land cap rate of 3%. AERIAL MAP OF LAND LEASE NO. 1 89

SKETCH OF LAND LEASE NO. 1 90

PHOTOGRAPH OF LAND LEASE NO. 1 PHOTOGRAPH TAKEN ON FEBRUARY 15, 2010 BY R. SHAWN BRANTLEY 91

Land Lease No. 2 Property Identification Property Identification Record ID 4312 Property Type Vacant Commercial Land, Land Lease/Open Storage Property Name Land Lease Address 8120 Pensacola Boulevard, Pensacola, Escambia County, Florida Location SE Corner of Carolina Dr. and Pensacola Blvd. Tax ID 22-1S-30-1101-003-006 Present Use Commercial Land Lease Data Lessor Robert M & Tara Turner, James Crooks and Shawn Crooks Lessee Timberline Homes Sale History 9/7/2008 Purchase from R&K Portable Bldgs $357,500 Verification Scott Jennings, Listing Agent, John S. Carr & Co.; 850-341- 7209, February 22, 2010; Other sources: Public records, MLS 363556, Confirmed by Rosanna Banks Lease Price $2,500 /month Land Data Zoning C-2, Commercial, C-2 Topography Level, Cleared: see soil comments Utilities All available; OH Power Dimensions 253'X381'X157'X65'X62'X225' Shape Irregular Fencing Minor Flood Info Zone X Future Land Use MU-1 Highest & Best Use Commercial Development Encumbrances None noted Depth 381 Land Size Information Gross Land Size Front Footage 1.650 Acres or 71,874 SF 634 ft Total Frontage: 253 ft ES Pensacola Blvd;381 ft SS Carolina Dr Indicators Lease Price/Gross Acre $1,515 Lease Price/Gross SF $0.03 Lease Price/Front Foot $4 Remarks The property was listed for sale on January 16, 2009 for $500,000 and expired on July 1, 2009. At the time, the site included a portable office building that was given no value in the listing, as well as fencing. The listing agent stated that the property owners withdrew the listing because they leased it to Timberline Homes at a rate of $2,500 per month. The property contains 90% Escambia Fine Sandy Loam (0-2% slope) a poorly drained soil and 10% Urban Land. However, the property has been re-surfaced with gravel and benefits from concrete drainage ditches along Pensacola Blvd. rating the site appropriate for improvements. Based on the asking price, a land cap rate of 6% is indicated. 92

AERIAL MAP OF LAND LEASE NO. 2 93

SKETCH OF LAND LEASE NO. 2 94

PHOTOGRAPH OF LAND LEASE NO. 2 PHOTO OBTAINED FROM MLS #363556, TAKEN BY SCOTT JENNINGS IN JANUARY 2009. INSPECTED BY SHAWN BRANTLEY ON FEBRUARY 15, 2010. 95

Land Lease No. 3 Property Identification Record ID 181 Property Name Autoland Address 5500 Pensacola Boulevard, Pensacola, Escambia County Location N/E Corner Highway 29 & Boone Street Tax ID 47-1S-30-1101-001-060 Date Inspected January 17, 2001 Land Use Code 40.34, Used Car Dealership Present Use Used car sales lot Physical Data Land Size 1.523 Acres or 66,329 SF Gross SF 1,125 Gross SF 1,125 Area Breakdown Sales Office 1,125 Construction Type Pre-fab metal Roof Type Metal panels Foundation Concrete slab on grade Electrical Adequate HVAC Central heat & air Stories One Floor Height 9 feet Year Built 1996 Condition Good General Lease Data Tenant Typical Lease Term Lease Type Autoland Monthly Gross General Tenant Summary Owner Graham & Company Management Co. Owner Verification Mike O'Daniels, partner of owner; (850) 476-0388, January 17, 2001; Other sources: Inspection, public records Renewals Monthly Encumbrances None noted Tenant Expenses Sales tax, utilities Rent Analysis Actual Rent $0.63/SF; $0.63/SF Average Remarks This is the lease of a 66,329 SF used car sales lot located at the northeast corner of U.S. Highway 29 and Boone Street, immediately north of Whataburger. The tenant, Autoland, vacated January, 2001. The owner currently occupies this space and continues its use as a used car sales lot. The former rent of $3,500 per month indicates $0.63/SF of site area on a gross basis, which is a common unit of comparison for car lots. We believe this site has a value of about $6.00/SF, indicating a land cap rate of 10.5%. 96

AERIAL MAP OF LAND LEASE NO. 3 N 97

SKETCH OF LAND LEASE NO. 3 Photograph taken by Paul Grimes on 01/17/01 PROPERTY SKETCH OLD PALAFOX HWY 160.65' 135.00' 67.00' 87.00' 47.00' 326.29' BOONE STREET 76.30' 25' 45' Office 25' 45' 159.00' +/- 60' Sketch by Apex IV Windows 69.20' 122.93' PENSACOLA BLVD Photo 98

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