ROMAN VILLAS APARTMENTS

ROMAN VILLAS APARTMENTS 7240 El Cajon Boulevard, San Diego, CA 92115 PROPERTY HIGHLIGHTS Extensive, Recent Interior and Exterior Upgrades Strong Unit Mix; Majority 2 Bedroom Units Strong Rental Market; Additional Upside In Rents Located Close to SDSU and La Mesa Benn Vogelsang Vice President (619) 7940381 vogelsang@scc1031.com 01883437 Phone: (619) 2266011 Fax: (866) 8617803 3405 Kenyon St #411 San Diego, CA 92110 www.scc1031.com

Table of Contents Investment Details... 3 Property Description... 4 Property Photos... 5 Property Photos... 6 Regional Map... 7 Location Map... 8 Aerial Map... 9 Executive Summary... 10 Pro Forma Summary... 11 Unit Mix Report... 12 Cash Flow Analysis... 13 Loan Analysis... 14 Cash In Cash Out... 15 Investment Return... 17 Internal Rate of Return... 18 Demographics... 19 Demographics... 20 APOD... 22 Comps... 23 Rent Survey... 28

INVESTMENT DETAILS Analysis Analysis Date November 2017 Property Property Property Address 7240 El Cajon Boulevard San Diego, CA 92115 Year Built 1972 Purchase Information Property Type MultiFamily Purchase Price $7,295,000 Units 28 Total Rentable Sq. Ft. 20,822 Financial Information Down Payment $2,700,000 Loans Type Debt Term Amortization Rate Payment Fixed $4,595,000 30 years 30 years 4.0% $21,937 Income & Expenses Gross Operating Income $491,432 Monthly GOI $40,953 Total Annual Expenses ($165,504) Monthly Expenses ($13,792) Contact Information Benn Vogelsang (619) 7940381 vogelsang@scc1031.com 01883437 Lora Johnson Associate (858) 3577179 johnson@scc1031.com Page 3

PROPERTY DESCRIPTION Roman Villas Aparments The is a 28 unit apartment complex that consists of 20,822 rentable square feet built in 1972 situated on a 14,043 square foot lot with approximately 16 parking spaces. The unit mix consists of (24) 2 Bedroom / 1 Bath units, (2) 1 Bedroom / 1 Bath units and (2) studios as well as onsite laundry facilities with 3 washers and 4 dryers. Select 2 Bedroom units have inunit stackable washers and dryers. There is a secure courtyard with a picnic table at the center of the property and a unique foyer behind the private entry to the property. Ownership has made significant exterior, interior and systems upgrades. The property has new windows, bathrooms and kitchens have been completely rebuilt, and there is laminate flooring throughout the units. The units feature new appliances, dishwashers, A/C units, and built in microwaves as well as new window coverings. The property has spacious floorplans and offers an investor additional upside in rents in the burgeoning Rolando Village Neighborhood near the College East District. DO NOT WALK ON THE PROPERTY OR DISTURB TENANTS. The property is located just East of where Montezuma Road and El Cajon Blvd meet in the College East District right by the Rolando Village Neighborhood. Rolando is a fully developed suburban community with homes, churches, businesses, parks, and schools. Rolando is a model suburb of San Diego. The exclusive suburban design of the Rolando Village area with its curved streets allows for the retention of its majority older singlefamily homes and is not an area inundated with apartment buildings. The area is just West of La Mesa and East of San Diego State University. Rolando has seen significant rent growth and an improvement in the tenantbase with college students, young professionals, and families residing there. Page 4

PROPERTY PHOTOS Roman Villas Aparments Page 5

PROPERTY PHOTOS Page 6

REGIONAL MAP Page 7

LOCATION MAP Page 8

AERIAL MAP Page 9

EXECUTIVE SUMMARY Acquisition Costs Purchase Price, Points and Closing Costs $7,295,000 Investment Cash $2,700,000 First Loan $4,595,000 Investment Information Purchase Price $7,295,000 Price per Unit $260,536 Price per Sq. Ft. $350.35 Income per Unit $18,090 Expenses per Unit ($5,911) Income, Expenses & Cash Flow Gross Scheduled Income $506,520 Total Vacancy and Credits ($15,088) Operating Expenses ($165,504) Net Operating Income $325,928 Debt Service ($263,247) Cash Flow Before Taxes $62,682 Financial Indicators Cash on Cash Return Before Taxes 2.32% Debt Coverage Ratio 1.24 Capitalization Rate 4.47% Gross Rent Multiplier 14.40 Gross Income / Square Feet $24.33 Gross Expenses / Square Feet ($7.95) Operating Expense Ratio 33.68% Page 10

PRO FORMA SUMMARY UNIT MIX & MONTHLY SCHEDULED Type Units Actual Total Market Total 2 bd / 1 ba 6 $1,585 $9,510 $1,675 $10,050 2 bd / 1 ba 18 $1,525 $27,450 $1,650 $29,700 1 bd / 1 ba 2 $1,350 $2,700 $1,350 $2,700 Studios 2 $1,125 $2,250 $1,200 $2,400 TOTALS 28 $41,910 $44,850 INVESTMENT SUMMARY Price: $7,295,000 Year Built: 1972 Units: 28 Price/Unit: $260,536 RSF: 20,822 Price/RSF: $350.35 Lot Size: 14,043 sf Floors: 2 APN: 46909122 Cap Rate: 4.47% Market Cap Rate: 4.92% GRM: 14.4 Market GRM: 13.46 FINANCING SUMMARY Loan Amount: $4,595,000 Down Payment: $2,700,000 Loan Type: Fixed Interest Rate: 4% Term: 30 years Monthly Payment: $21,937 DCR: 1.24 ANNUALIZED INCOME Description Actual Market Gross Potential Rent $502,920 $538,200 Less: Vacancy ($15,088) ($16,146) Misc. Income $3,600 $3,600 Effective Gross Income $491,432 $525,654 Less: Expenses ($165,504) ($167,088) Net Operating Income $325,928 $358,566 Debt Service ($263,247) ($263,247) Net Cash Flow after Debt Service $62,682 $95,319 Principal Reduction $80,920 $80,920 Total Return $143,601 $176,239 ANNUALIZED EXPENSES Description Actual Market Property Management Fee $25,326 $26,910 Building Insurance $8,584 $8,584 Grounds Maintenance $7,219 $7,219 Licenses & Fees $420 $420 Maintenance $14,000 $14,000 Management (Onsite) $3,600 $3,600 Pest Control $822 $822 Taxes Real Estate $82,434 $82,434 Trash Removal $3,000 $3,000 Utilities Gas & Electric $8,610 $8,610 Utilities Water & Sewer $11,489 $11,489 Total Expenses $165,504 $167,088 Expenses Per RSF $7.95 $8.02 Expenses Per Unit $5,911 $5,967 Page 11

UNIT MIX REPORT Units Type Approx. SqFt Avg. Rents Monthly Mkt Rents Monthly 6 2 bd / 1 ba 780 $1,585 $9,510 $1,675 $10,050 18 2 bd / 1 ba 780 $1,525 $27,450 $1,650 $29,700 2 1 bd / 1 ba 600 $1,350 $2,700 $1,350 $2,700 2 Studios 451 $1,125 $2,250 $1,200 $2,400 28 20,822 $41,910 $44,850 UNIT MIX UNIT MIX SQUARE FEET 2 bd / 1 ba 2 bd / 1 ba 1 bd / 1 ba Studios 2 bd / 1 ba 2 bd / 1 ba 1 bd / 1 ba Studios UNIT MIX INCOME UNIT MIX MARKET INCOME 2 bd / 1 ba 2 bd / 1 ba 1 bd / 1 ba Studios 2 bd / 1 ba 2 bd / 1 ba 1 bd / 1 ba Studios Page 12

CASH FLOW ANALYSIS Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 GROSS SCHEDULED INCOME $506,520 $521,716 $537,367 $553,488 $570,093 $587,196 $604,811 $622,956 $641,644 $660,894 Turnover Vacancy ($15,088) ($15,540) ($16,006) ($16,487) ($16,981) ($17,491) ($18,015) ($18,556) ($19,113) ($19,686) Total Operating Expenses ($165,504) ($166,264) ($167,046) ($167,852) ($168,683) ($169,538) ($170,419) ($171,326) ($172,260) ($173,223) NET OPERATING INCOME $325,928 $339,912 $354,314 $369,149 $384,429 $400,167 $416,377 $433,074 $450,272 $467,985 Loan Payment ($263,247) ($263,247) ($263,247) ($263,247) ($263,247) ($263,247) ($263,247) ($263,247) ($263,247) ($263,247) NET CASH FLOW (b/t) $62,682 $76,665 $91,067 $105,902 $121,182 $136,920 $153,131 $169,827 $187,025 $204,738 Cash On Cash Return b/t 2.32% 2.84% 3.37% 3.92% 4.49% 5.07% 5.67% 6.29% 6.93% 7.58% * b/t = before taxes;a/t = after taxes Page 13

LOAN ANALYSIS Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 LOAN 1 Debt Service Analysis Principal Payments $80,920 $84,216 $87,648 $91,218 $94,935 $98,803 $102,828 $107,017 $111,377 $115,915 Interest Payments $182,327 $179,030 $175,599 $172,028 $168,312 $164,444 $160,419 $156,229 $151,869 $147,332 Total Debt Service $263,247 $263,247 $263,247 $263,247 $263,247 $263,247 $263,247 $263,247 $263,247 $263,247 Principal Balance Analysis Beginning Principal Balance $4,595,000 $4,514,080 $4,429,864 $4,342,216 $4,250,998 $4,156,063 $4,057,261 $3,954,433 $3,847,415 $3,736,038 Principal Reductions $80,920 $84,216 $87,648 $91,218 $94,935 $98,803 $102,828 $107,017 $111,377 $115,915 Ending Principal Balance $4,514,080 $4,429,864 $4,342,216 $4,250,998 $4,156,063 $4,057,261 $3,954,433 $3,847,415 $3,736,038 $3,620,123 Page 14

CASH IN CASH OUT Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Rental Income $502,920 $518,008 $533,548 $549,554 $566,041 $583,022 $600,513 $618,528 $637,084 $656,197 Parking and Laundry Income $3,600 $3,708 $3,819 $3,934 $4,052 $4,173 $4,299 $4,428 $4,560 $4,697 GROSS SCHEDULED INCOME $506,520 $521,716 $537,367 $553,488 $570,093 $587,196 $604,811 $622,956 $641,644 $660,894 Turnover Vacancy ($15,088) ($15,540) ($16,006) ($16,487) ($16,981) ($17,491) ($18,015) ($18,556) ($19,113) ($19,686) GROSS OPERATING INCOME $491,432 $506,175 $521,361 $537,001 $553,111 $569,705 $586,796 $604,400 $622,532 $641,208 Expenses Property Management Fee ($25,326) ($26,086) ($26,868) ($27,674) ($28,505) ($29,360) ($30,241) ($31,148) ($32,082) ($33,045) Building Insurance ($8,584) ($8,584) ($8,584) ($8,584) ($8,584) ($8,584) ($8,584) ($8,584) ($8,584) ($8,584) Grounds Maintenance ($7,219) ($7,219) ($7,219) ($7,219) ($7,219) ($7,219) ($7,219) ($7,219) ($7,219) ($7,219) Licenses & Fees ($420) ($420) ($420) ($420) ($420) ($420) ($420) ($420) ($420) ($420) Maintenance ($14,000) ($14,000) ($14,000) ($14,000) ($14,000) ($14,000) ($14,000) ($14,000) ($14,000) ($14,000) Management (Onsite) ($3,600) ($3,600) ($3,600) ($3,600) ($3,600) ($3,600) ($3,600) ($3,600) ($3,600) ($3,600) Pest Control ($822) ($822) ($822) ($822) ($822) ($822) ($822) ($822) ($822) ($822) Taxes Real Estate ($82,434) ($82,434) ($82,434) ($82,434) ($82,434) ($82,434) ($82,434) ($82,434) ($82,434) ($82,434) Trash Removal ($3,000) ($3,000) ($3,000) ($3,000) ($3,000) ($3,000) ($3,000) ($3,000) ($3,000) ($3,000) Utilities Gas & Electric ($8,610) ($8,610) ($8,610) ($8,610) ($8,610) ($8,610) ($8,610) ($8,610) ($8,610) ($8,610) Utilities Water & Sewer ($11,489) ($11,489) ($11,489) ($11,489) ($11,489) ($11,489) ($11,489) ($11,489) ($11,489) ($11,489) TOTAL OPERATING EXPENSES ($165,504) ($166,264) ($167,046) ($167,852) ($168,683) ($169,538) ($170,419) ($171,326) ($172,260) ($173,223) NET OPERATING INCOME $325,928 $339,912 $354,314 $369,149 $384,429 $400,167 $416,377 $433,074 $450,272 $467,985 * Cash Flow IRR based upon net cash flow and principal payments Page 15

CASH IN CASH OUT Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Debt Service Loan Interest ($182,327) ($179,030) ($175,599) ($172,028) ($168,312) ($164,444) ($160,419) ($156,229) ($151,869) ($147,332) Principal Payments ($80,920) ($84,216) ($87,648) ($91,218) ($94,935) ($98,803) ($102,828) ($107,017) ($111,377) ($115,915) NET CASH FLOW (b/t) $62,682 $76,665 $91,067 $105,902 $121,182 $136,920 $153,131 $169,827 $187,025 $204,738 Cash Flow IRR N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Projected Property Value $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 Resale Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Proceeds b/f Debt Payoff $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 $7,295,000 Loan Principal Balance ($4,514,080) ($4,429,864) ($4,342,216) ($4,250,998) ($4,156,063) ($4,057,261) ($3,954,433) ($3,847,415) ($3,736,038) ($3,620,123) Net Proceeds From Sale $2,780,920 $2,865,136 $2,952,784 $3,044,002 $3,138,937 $3,237,739 $3,340,567 $3,447,585 $3,558,962 $3,674,877 Net Resale IRR 5.32% 5.55% 5.77% 5.99% 6.20% 6.40% 6.59% 6.77% 6.95% 7.12% * Cash Flow IRR based upon net cash flow and principal payments Page 16

INVESTMENT RETURN ANALYSIS Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Cash Flow To Date $62,682 $139,346 $230,414 $336,316 $457,498 $594,418 $747,549 $917,376 $1,104,401 $1,309,140 Net Resale Proceeds $2,717,380 $2,735,285 $2,756,621 $2,781,528 $2,810,151 $2,842,642 $2,879,159 $2,919,864 $2,964,930 $3,017,306 Invested Capital ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) ($2,700,000) Net Return on Investment $80,062 $174,631 $287,035 $417,844 $567,649 $737,061 $926,708 $1,137,241 $1,369,331 $1,626,445 Internal Rate of Return 2.97% 3.22% 3.51% 3.80% 4.10% 4.39% 4.68% 4.96% 5.23% 5.50% Modified IRR 2.97% 3.18% 3.42% 3.66% 3.89% 4.10% 4.31% 4.49% 4.66% 4.83% NPV (cash flow + reversion) $143,601 $304,482 $483,197 $680,318 $896,435 $1,132,158 $1,388,116 $1,664,961 $1,963,363 $2,284,017 PV (NOI + reversion) $7,620,928 $7,960,840 $8,315,154 $8,684,303 $9,068,732 $9,468,899 $9,885,277 $10,318,351 $10,768,622 $11,236,608 * a/t = after taxes; Modified IRR = Modified Internal Rate of Return; PV = Present Value; NPV = Net Present Value; NOI = Net Operating Income Page 17

INTERNAL RATE OF RETURN ANALYSIS BEFORE TAX IRR Time Future Cash Flows Initial Investment ($2,700,000) End of Year 1 $62,682 End of Year 2 $76,665 End of Year 3 $91,067 End of Year 4 $105,902 End of Year 5 $121,182 End of Year 6 $136,920 End of Year 7 $153,131 End of Year 8 $169,827 End of Year 9 $187,025 End of Year 10* $3,879,615 IRR = 7.12% * ($204,738 + $3,674,877) AFTER TAX IRR Time Future Cash Flows Initial Investment ($2,700,000) End of Year 1 $62,682 End of Year 2 $76,665 End of Year 3 $91,067 End of Year 4 $105,902 End of Year 5 $121,182 End of Year 6 $136,920 End of Year 7 $153,131 End of Year 8 $169,827 End of Year 9 $187,025 End of Year 10* $3,222,044 IRR = 5.5% * ($204,738 + $3,017,306) Page 18

DEMOGRAPHICS Population Characteristic 1 Mile 3 Mile 5 Mile Ages 04 1,478 10,652 31,936 Ages 59 1,657 12,033 36,602 Ages 1014 1,396 10,354 32,138 Ages 1519 1,240 9,583 30,552 Ages 2024 1,346 10,554 32,198 Ages 2529 1,584 11,981 33,717 Ages 3034 1,888 13,013 34,141 Ages 3539 2,146 13,473 34,338 Ages 4044 2,228 13,225 34,300 Ages 4549 2,197 12,822 34,185 Ages 5054 2,016 11,907 32,051 Ages 5559 1,720 10,579 28,502 Ages 6064 1,429 8,993 23,845 Ages 6569 1,135 7,193 18,737 Ages 7074 873 5,649 14,053 Ages 7579 660 4,484 10,375 Ages 8084 489 3,375 7,164 Race Characteristic 1 Mile 3 Mile 5 Mile Non Hispanic White 18,847 115,987 272,315 Population Black 2,012 14,019 45,681 Population Am In/AK Nat 80 344 920 Household Income 1 Mile 3 Mile 5 Mile Median Household Income $53,195 $54,571 $54,839 < $10000 707 4,362 10,321 $10000$14999 782 4,021 9,660 $15000$19999 724 3,832 9,216 $20000$24999 563 3,939 9,492 $25000$29999 567 3,494 8,680 $30000$34999 778 3,947 9,286 $35000$39999 587 2,925 8,710 $40000$44999 607 3,407 8,515 $45000$49999 488 2,593 7,052 $50000$60000 1,035 5,638 14,928 $60000$74000 1,346 5,867 17,048 $75000$99999 1,558 9,815 23,738 $100000$124999 944 5,821 14,214 $125000$149999 349 3,250 8,663 $150000$199999 433 2,624 6,687 > $200000 191 1,987 5,212 Characteristic Housing 1 Mile 3 Mile Housing Units 13,008 74,789 Occupied Housing Units 12,211 70,546 Owner Occupied Housing Units 5,504 34,685 Renter Occupied Housing Units 6,707 35,861 Vacant Housing Units 797 4,243 Page 19

DEMOGRAPHICS Population 1 Mile 3 Mile 5 Mile Male 13,099 (49.52 %) 86,279 (48.89 %) 235,299 (48.87 %) Female 13,355 (50.48 %) 90,181 (51.11 %) 246,211 (51.13 %) Total Population 26,454 176,460 481,510 Age Breakdown 1 Mile 3 Mile 5 Mile Ages 04 1,478 (5.59 %) 10,652 (6.04 %) 31,936 (6.63 %) Ages 59 1,657 (6.26 %) 12,033 (6.82 %) 36,602 (7.60 %) Ages 1014 1,396 (5.28 %) 10,354 (5.87 %) 32,138 (7.60 %) Ages 1519 1,240 (4.69 %) 9,583 (5.43 %) 30,552 (6.35 %) Ages 2024 1,346 (5.09 %) 10,554 (5.98 %) 32,198 (6.69 %) Ages 2529 1,584 (5.99 %) 11,981 (6.79 %) 33,717 (7.00 %) Ages 3034 1,888 (7.14 %) 13,013 (7.37 %) 34,141 (7.09 %) Ages 3539 2,146 (8.11 %) 13,473 (7.64 %) 34,338 (7.13 %) Ages 4044 2,228 (8.42 %) 13,225 (7.49 %) 34,300 (7.12 %) Ages 4549 2,197 (8.30 %) 12,822 (7.27 %) 34,185 (7.10 %) Ages 5054 2,016 (7.62 %) 11,907 (6.75 %) 32,051 (6.66 %) Ages 5559 1,720 (6.50 %) 10,579 (6.00 %) 28,502 (5.92 %) Ages 6064 1,429 (5.40 %) 8,993 (5.10 %) 23,845 (4.95 %) Ages 6569 1,135 (4.29 %) 7,193 (4.08 %) 18,737 (3.89 %) Ages 7074 873 (3.30 %) 5,649 (3.20 %) 14,053 (2.92 %) Ages 7579 660 (2.49 %) 4,484 (2.54 %) 10,375 (2.15 %) Ages 8084 489 (1.85 %) 3,375 (1.91 %) 7,164 (1.49 %) Ages 85+ 972 (3.67 %) 6,590 (3.73 %) 12,676 (2.63 %) Page 20

DEMOGRAPHICS Household Income 1 Mile 3 Mile 5 Mile Median Income $53,195 $54,571 $54,839 Less than $10,000 707 4,362 10,321 $10,000 $14,999 782 4,021 9,660 $15,000 $19,999 724 3,832 9,216 $20,000 $24,999 563 3,939 9,492 $25,000 $29,999 567 3,494 8,680 $30,000 $34,999 778 3,947 9,286 $35,000 $39,999 587 2,925 8,710 $40,000 $44,999 607 3,407 8,515 $45,000 $49,999 488 2,593 7,052 $50,000 $59,999 1,035 5,638 14,928 $60,000 $74,999 1,346 5,867 17,048 $75,000 $99,999 1,558 9,815 23,738 $100,000 $124,999 944 5,821 14,214 $125,000 $149,999 349 3,250 8,663 $150,000 $199,999 433 2,624 6,687 Greater than $200,000 191 1,987 5,212 Housing 1 Mile 3 Mile 5 Mile Housing Units 13,008 74,789 187,014 Occupied Units 12,211 70,546 176,951 Owner Occupied Units 5,504 34,685 87,235 Renter Occupied Units 6,707 35,861 89,716 Vacant Units 797 4,243 10,063 Race Demographics 1 Mile 3 Mile 5 Mile Population Non Hispanic White 18,847 115,987 272,315 Population Black 2,012 14,019 45,681 Population Am In/Ak Nat 80 344 920 Page 21

APOD CASH FLOW ANALYSIS APARTMENT INVESTMENT INFORMATION # Units Address City Zip 28 7240 El Cajon Blvd San Diego 92115 GRM CAP Rate Price Current Market Current Market $7,295,000 14.4 13.5 4.4% 4.9%. $/Square Foot Gross Sq. Ft. Parcel Size (Approx.) (Approx.) (Approx.) $350.35 20822 14,043 $/Unit $260,536 Yr. Built (Approx.) 1972 Map Code Income Detail Estimated Annual Operating Expenses # Units Type Rent Total Estimated Actual Average Rents Rent Range Advertising $0 Management (Off Site) $25,260 6 2Br/1Ba $1,585 $9,510 Elevator $0 Management (On Site) $3,600 18 2Br/1Ba $1,525 $27,450 Gas & Electric $8,610 Licenses & Fees $420 2 1Br/1Ba $1,295 $2,590 Water & Sewer $11,489 Miscellaneous $0 2 Studios $1,125 $2,250 Landscaping $7,219 Reserves $0 Trash Removal $3,000 Pool $0 Parking & Laundry Income $300 Pest Control $822 Insurance $8,584 Total Monthly Income $42,100 Maintenance $14,000 Taxes $82,434 Estimated Market Rents Total Annual Operating Expenses (estimated): $165,438 6 2Br/1Ba $1,675 $10,050 18 2Br/1Ba $1,650 $29,700 Expenses Per: Unit $5,908 2 1Br/1Ba $1,350 $2,700 % of Actual GSI 33% 2 Studios $1,200 $2,400 Parking & Laundry Income $300 Total Monthly Income $45,150 Estimated Annual Operating Proforma Financing Summary Actual Market Gross Scheduled Income $505,200 $541,800 Downpayment: $2,700,000 Less: Vacancy Factor 3% $15,156 $16,254 37% Gross Operating Income $490,044 $525,546 Interest Rate: 4.000% Less: Expenses 33% $165,438 $165,438 Amortized over: 30 Years Net Operating Income $324,607 $360,109 Proposed Loan Amount: $4,595,000 Less: 1st TD Payments ($263,247) ($263,247) Debt Coverage Ratio: Current: 1.23 PreTax Cash Flow $61,360 $96,862 Market: 1.37 Cash On Cash Return 2.3% 3.6% Principal Reduction $80,920 $80,920 Total Potential Return (End of Year One) 5% 7% Comments PLEASE DO NOT WALK ON THE PROPERTY OR DISTURB TENANTS Benn Vogelsang 6197940381 BRE # 01883437 vogelsang@scc1031.com The information contained herein has been obtained from sources believed reliable. While South Coast Commercial does not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates are used for example only and do not represent the current or future performance of the property. The value of this transaction to you depends on tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs. BRE # 01846358 Page 22

COMPS 1 4471 44th St Talmadge on 44th SOLD San Diego, CA 92115 San Diego County Sale Date: 09/07/2017 Bldg Type: Class C MultiFamilyApartments Sale Price: Price/SF: $5,125,000 Confirmed $338.96 Year Built/Age: GBA: Built 1965 Age: 52 15,120 SF Price/Unit: $284,722 # of Units: 18 PrFrma Cap Rate: Actual Cap Rate: 4.53% Zoning: Sale Conditions: MR25 GRM/GIM: Parcel No: 47103215 Financing: Down payment of $5,125,000 (100.0%) Comp ID: 4004446 Research Status: Confirmed Map Page: Thomas Bros. Guide 1269H4 2 4424 51st St El Camino Apartments SOLD San Diego, CA 92115 San Diego County Sale Date: 01/31/2017 (209 days on mkt) Bldg Type: Sale Price: Price/SF: $2,930,000 Confirmed $347.16 Year Built/Age: GBA: 8,440 SF Price/Unit: $266,364 # of Units: 11 PrFrma Cap Rate: Actual Cap Rate: 5.20% Zoning: Sale Conditions: GRM/GIM: 13.40/ Parcel No: 4720111700 Financing: Down payment of $2,930,000 (100.0%) Comp ID: 3821866 Research Status: Confirmed Class C MultiFamilyApartments Built 1965 Renov 2016 Age: 52 MR10B, San Diego 1031 Exchange, Debt Assumption Map Page: Thomas Bros. Guide 1270A4 3 47474753 67th St SOLD San Diego, CA 92115 San Diego County Sale Date: 02/09/2017 (70 days on mkt) Bldg Type: Class C MultiFamilyApartments Sale Price: Price/SF: $4,025,000 Confirmed $254.89 Year Built/Age: GBA: Built 1973 Age: 44 15,791 SF Price/Unit: $268,333 # of Units: 15 PrFrma Cap Rate: Actual Cap Rate: 4.35% Zoning: Sale Conditions: R2 GRM/GIM: Parcel No: 46833021, 46833033 Financing: Down payment of $4,025,000 (100.0%) Comp ID: 3835307 Research Status: Confirmed Copyrighted report licensed to South Coast Commercial, Inc. 505729. 11/16/2017 Page 1 Page 23

COMPS 4 5015 Comanche Dr SOLD La Mesa, CA 91942 San Diego County Sale Date: 10/31/2017 (118 days on mkt) Bldg Type: Class C MultiFamilyApartments Sale Price: Price/SF: $3,220,000 Confirmed $276.42 Year Built/Age: GBA: Built 1957 Age: 60 11,649 SF Price/Unit: $268,333 # of Units: 12 PrFrma Cap Rate: Actual Cap Rate: 6.11% 5.37% Zoning: Sale Conditions: R4 Deferred Maintenance GRM/GIM: 13.15/ Parcel No: 47009132 Financing: Down payment of $945,000 (29.3%); $2,275,000 from Burbank Financial Inc Comp ID: 4045289 Research Status: Confirmed 5 6345 El Cajon Blvd BLVD63 SOLD San Diego, CA 92115 San Diego County Sale Date: 11/03/2016 Bldg Type: Sale Price: Price/SF: $156,000,000 Confirmed $276.46 Year Built/Age: GBA: 564,272 SF Price/Unit: $469,880 # of Units: 332 PrFrma Cap Rate: Actual Cap Rate: Zoning: Sale Conditions: GRM/GIM: Parcel No: Financing: 46730038 Comp ID: 3754211 Research Status: Confirmed Class A MultiFamilyApartments Built 2014 Age: 2 Deed Restriction 6 7394 La Mesita Pl SOLD La Mesa, CA 91942 San Diego County Sale Date: 09/12/2017 (235 days on mkt) Bldg Type: Class A MultiFamilyApartments Sale Price: Price/SF: $5,925,000 Confirmed $283.44 Year Built/Age: GBA: Built 2017 20,904 SF Price/Unit: $455,769 # of Units: 13 PrFrma Cap Rate: Actual Cap Rate: 5.40% Zoning: Sale Conditions: R3 1031 Exchange GRM/GIM: 13.92/ Parcel No: 46921110 Financing: Down payment of $1,925,000 (32.5%); $4,000,000 from Mission Federal Credit Union Comp ID: 4001230 Research Status: Confirmed Copyrighted report licensed to South Coast Commercial, Inc. 505729. 11/16/2017 Page 2 Page 24

COMPS 7 7400 Parkway Dr The Cove SOLD La Mesa, CA 91942 San Diego County Sale Date: 09/29/2017 Bldg Type: Class C MultiFamilyApartments Sale Price: Price/SF: $33,950,000 Confirmed $315.15 Year Built/Age: GBA: Built 1974 Renov 1998 Age: 43 107,725 SF Price/Unit: $253,358 # of Units: 133 PrFrma Cap Rate: Actual Cap Rate: 4.50% Zoning: Sale Conditions: GRM/GIM: Parcel No: 4644800400 Financing: $21,998,000 from Berkadia Commercial Mortgage, LLC; Conventional loan type Comp ID: 4018311 Research Status: Confirmed 8 4474 Winona Ave Talmadge SOLD San Diego, CA 92115 San Diego County Sale Date: 01/24/2017 (85 days on mkt) Bldg Type: Sale Price: Price/SF: $2,625,000 Confirmed $381.54 Year Built/Age: GBA: 6,880 SF Price/Unit: $262,500 # of Units: 10 PrFrma Cap Rate: Actual Cap Rate: 4.80% Zoning: Sale Conditions: GRM/GIM: 13.90/ Parcel No: Financing: 47115105, 4711510500 $1,312,500 from Homestreet Bank Comp ID: 3816259 Research Status: Confirmed Class C MultiFamilyApartments Built 1972 Renov 2016 Age: 45 R4, San Diego 1031 Exchange Copyrighted report licensed to South Coast Commercial, Inc. 505729. 11/16/2017 Page 3 Page 25

COMPS Address City Property Info Sale Info 1 4471 44th St San Diego 15,120 SF Multi Family/Apartments Sold: $5,125,000 ($284,722/Unit) 2 4424 51st St San Diego 8,440 SF MultiFamily/Apartments Sold: $2,930,000 ($266,364/Unit) 3 47474753 67th St San Diego 15,791 SF Multi Family/Apartments Sold: $4,025,000 ($268,333/Unit) 4 5015 Comanche Dr La Mesa 11,649 SF Multi Family/Apartments Sold: $3,220,000 ($268,333/Unit) 5 6345 El Cajon Blvd San Diego 564,272 SF Multi Family/Apartments Sold: $156,000,000 ($469,880/Unit) 6 7394 La Mesita Pl La Mesa 20,904 SF Multi Family/Apartments Sold: $5,925,000 ($455,769/Unit) 7 7400 Parkway Dr La Mesa 107,725 SF Multi Family/Apartments Sold: $33,950,000 ($253,358/Unit) 8 4474 Winona Ave San Diego 6,880 SF MultiFamily/Apartments Sold: $2,625,000 ($262,500/Unit) Copyrighted report licensed to South Coast Commercial, Inc. 505729. 11/16/2017 Page 4 Page 26

COMPS Quick Stats Report Comps Statistics Low Average Median High Count Sale Price $2,625,000 $26,725,000 $4,575,000 $156,000,000 8 Building Size 6,880 SF 93,848 SF 15,456 SF 564,272 SF 8 Price per SF $254.89 $284.77 $299.30 $381.54 8 Actual Cap Rate 4.35% 4.88% 4.80% 5.40% 7 Gross Income Multiplier Gross Rent Multiplier 13.15 13.64 13.65 13.92 4 # of Units 10 68 14 332 8 Price per Unit $253,358 $393,015 $268,333 $469,880 8 Days on Market 70 143 118 235 5 Sale Price to Asking Price Ratio 96.41% 98.31% 99.06% 99.16% 5 Totals Sold Transactions Total Sales Volume: $213,800,000 Total Sales Transactions: 8 Survey Criteria basic criteria: Type of Property MultiFamily; Sale Date from 11/1/2016; Sale Status Sold; Return and Search on Portfolio Sales as Individual Properties Yes; Exclude NonArms Length Comps Yes multifamily specific criteria: Price/Unit from $200,000.00; Include Undisclosed Sale Price geography criteria: Zip Code 91941, La Mesa, CA; 91942, La Mesa, CA; 92115, San Diego, CA Copyrighted report licensed to South Coast Commercial, Inc. 505729. 11/16/2017 Page 5 Page 27

RENT SURVEY Location Rent Unit Mix SF Rent/SF Amenities 4474 Winona Ave $1,780 2Br/1Ba 800 $2.23 Granite, laminate flooring, dishwasher, stainless steel appliances, common laundry, 1 parking space 4474 Winona Ave $1,475 1Br/1Ba 600 $2.46 Granite, laminate flooring, dishwasher, stainless steel appliances, common laundry, 1 parking space 4433 Winona Ave $1,895 2Br/2Ba 900 $2.11 Dishwasher, Granite, Plank Flooring, garage, in unit laundry 4424 51st Street $1,750 2Br/2Ba 900 $1.94 New Kitchens and Bathrooms, common laundry 5502 Adelaide Ave $1,750 2Br/2Ba 850 $2.06 Dishwasher, Granite, Plank Flooring, garage, in unit laundry 4380 Van Dyke Ave $1,650 2Br/2Ba 900 $1.83 Tile Flooring, New Kitchen, dishwasher 4380 Van Dyke Ave $1,395 1Br/1Ba 550 $2.54 Laminate Flooring, New Kitchen, no dishwasher 4424 51st Street $1,415 1Br/1Ba 550 $2.57 Granite, laminate flooring, dishwasher, stainless steel appliances, common laundry, 1 parking space $1,639 756 $2.22 Page 28