Residences at Riverwalk - Amesbury

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CONDOMINIUMQUALITY, MULTIFAMILY INVESTMENT OPPORTUNITY

CONFIDENTIAL OFFERING MEMORANDUM

EXCLUSIVE SALES AGENT

303 Congress Street Boston, MA 02210 617.457.3400 www.naihunneman.com

One River Court & 24 Oak Street Amesbury, MA

This is a confidential presentation intended solely for your limited use when considering whether to pursue negotiations to acquire the property. This document and its contents are confidential and are not to be copied, circulated, or otherwise used without the express, prior written consent of NAI Hunneman Commercial. This investment brochure is subject to errors, omissions, prior sale, and withdrawal from the market without notice. The material contained in this brochure is based in part upon information supplied by the owner of the property to the best of its ability and knowledge and in part upon information obtained by NAI Hunneman Commercial from sources it deems to be generally reliable. Summaries contained herein of any legal documents are not intended to be comprehensive statements of the terms of such documents but rather only outlines of some of the principal provisions contained therein. No warranty or representation, expressed or implied, is made by NAI Hunneman Commercial or any of its subsidiaries as to the accuracy or completeness of the information. Note: This property is exclusively listed with NAI Hunneman, Brokers from other firms may not copy or disperse this property information without prior consent from the listing broker. Cooperating brokers must complete “client registration form” (available upon request). Cooperating brokers may only share this information with clients listed on the “client registration form.”

FOR FURTHER INFORMATION PLEASE CONTACT:

CARL CHRISTIE Executive Vice President/Principal 617.457.3394 cchristie@naihunneman.com DAN MCGEE Sales Associate 617.457.3266 dmcgee@naihunneman.com

HENRY D. LIEBER Sales Associate 617.457.3383 hlieber@naihunneman.com

TABLE OF Contents

INVESTMENT HIGHLIGHTS & HISTORY.................. 2

EXECUTIVE SUMMARY ........................................ 3

PROPERTY OVERVIEW......................................... 4

LOCATION OVERVIEW ....................................... 10

MARKET OVERVIEW ............................................ 15

FINANCIAL ANALYSIS ......................................... 18

INVESTMENT HIGHLIGHTS & HISTORY

HIGHLIGHTS 87 UNITS: Great opportunity to obtain a sizable apartment community in attractive Amesbury, Massachusetts. CLASS A PROPERTY: These two apartment buildings were completely renovated in 2006 from vacant historic mills. Building amenities include elevator access, a fitness center, luxury great room and entertainment area, a library, and computer room. The residences were developed to condo quality and represent one of Amesbury’s most desirable rental properties. The grounds are nicely landscaped and improved with outdoor amenities including a gazebo by the river, grills with picnic tables, and easy access to the adjacent Riverwalk bike path. LOCATION: The property is well located, convenient to I-495 and 95. Also, the property is near the MBTA’s commuter train in Newburyport. LENDING ENVIRONMENT: Interest rates are at all time lows and multifamily assets enjoy privileged access to credit. CASH FLOW OR CONDO: Investors can hold the property for cash flow investment or convert to condominiums, at the right time, for a profitable exit strategy.

HISTORY

These two mill buildings were constructed between the late 1800’s and early 1900’s and formed the backbone of Amesbury’s thriving manufacturing industries driven by the Powwow River. They were home to carriage makers, and most notably the Walker Auto Body and the Spofford and Smart Factory. The buildings retain the lines of historic character and have been nominated for the National Register of Historic Places status. The properties were renovated in 2006 into apartments through a historic rehab tax credit.

EXECUTIVE SUMMARY

LUXURY SET WITHIN HISTORY NAI Hunneman, as exclusive agent, is pleased to offer for sale the Residences at Riverwalk in Amesbury, MA. The subject property is an 87-unit luxury apartment complex consisting of two mill buildings that were completely renovated in 2006. The property offers unique apartment homes and blends historic character with modern style in an attractive setting along the Powwow River. The Riverwalk Apartments offer an excellent opportunity for investors to acquire a turn- key, Class A, investment property with a condo conversion exit strategy.

UNIT MIX

The breakdown includes sixty-nine flats at One River Court and eighteen townhouses at 24 Oak Street. The building breakdown is listed below:

ADDRESS

1 BEDS

2 BEDS

3 BEDS TOTAL UNITS RENTABLE SF

1 RIVER COURT 24 OAK STREET

52 16 68

0 2 2

69 18 87

66,923 23,666 90,589

TOTALS

19.5%

78.2%

2.3%

THE PROPERTIES OFFER A VARIETY OF ATTRACTIVE LAYOUTS INCLUDING:

1 RIVER COURT

# OF UNITS % OF TOTAL

1 BED / 1 BATH FLAT 2 BED / 1.5 BATH FLAT 2 BED / 2 BATH FLAT

19.5%

660-980 826-1045

6.9%

46 69

52.9% 1,012-1,205

TOTALS

66,923

24 OAK STREET

# OF UNITS % OF TOTAL

2 BED / 2 BATH TOWNHOUSE 3 BED / 2 BATH TOWNHOUSE

18.4% 1,107-1,368

2.3%

1,499-2,116

TOTALS

23,666

ONE RIVER COURT YEAR BUILT:

Originally built in 1918, the mill was converted into apartments in 2006

LOT SIZE:

2.66 ± acres

PROPERTY TYPE:

Three-story apartment building with flat units on each floor. The first floor has 19 units, the second and third floors both have 25 units

BUILDING SIZE:

66,911 ± SF (rentable area); 80,591 ± SF (gross building area) (source: The Warren Group)

CONSTRUCTION: Wood frame mill building # OF UNITS: Sixty-nine apartment units UNIT MIX:

Seventeen (17) one-bed / 1-bath; six (6) two-bed / 1.5-bath; forty-six (46) two-bed / 2-bath units There are 100+ parking spaces located in front, along the side and in the rear of the building This building contains a luxury great room with entertainment space, a classically styled library with built-in bookcases and newspaper rack, a computer with high-speed internet access, and a state-of-the-art fitness center. One River Court has elevator access to all levels. The odd numbered units on the 3rd floor have gas fireplaces and face the river. The even numbered units on the 3rd floor have glass clearstories and face the Riverwalk.

PARKING:

AMENITIES:

PROPERTY OVERVIEW

24 OAK STREET YEAR BUILT:

Originally built in 1885, the mill was converted into apartments in 2006

LOT SIZE:

1.88 ± acres

PROPERTY TYPE:

Three-story apartment building with duplex units. There are nine duplex units located in the back of the building that have private entrances and are located on the ground and 1st level. There are nine duplex units located on the 1st and 2nd level.

BUILDING SIZE:

23,666 ± SF (rentable area); 27,738 ± SF (gross building area) (source: The Warren Group)

CONSTRUCTION: Brick and beam mill building # OF UNITS: Eighteen apartment units UNIT MIX:

Sixteen (16) two-bed / 2-bath duplex units and two (2) three-bed / 3 bath duplex units

PARKING: AMENITIES:

30 ± parking spaces in the rear of the building

24 Oak Street contains a section with storage for tenants and is well-located close to the gazebo, river, and Riverwalk

WWW.RIVERWALKAMESBURY.COM

APARTMENT AMENITITES CEILING HEIGHTS: 9’ to 10’ ceiling heights as well as soaring 14’ cathedral ceilings in select units COUNTER TOPS: Granite countertops in kitchens and vanities KITCHENS: Stainless steel kitchen appliances with space saving microwaves, gas range and conventional oven, garbage disposals, electronic touch temperature controlled refrigerators, and ice makers

WASHER/DRYER: CEILING FANS:

Full size washer and dryer Ceiling fans in select units Gas fireplaces in select units Glass clearstory in select units Attractive oversized windows

FIREPLACES: CLEARSTORY: WINDOWS: FLOORING:

Carpeting in bedrooms and living rooms, ceramic tile in kitchens and baths, hardwood floors in select units Energy efficient heating and air-conditioning; gas-fired forced hot air system provides heat, electric compressor units provide central A/C Tenants pay heat, hot water, and electricity. The landlord pays common area electric and municipal water/sewer

HVAC:

UTILITIES:

PROPERTY OVERVIEW

BUILDING INFORMATION GREAT ROOM:

Luxury great room with high ceilings, hardwood flooring, oversized fireplace, and wet bar Classically styled library with built-in bookcases and newspaper rack

LIBRARY:

COMPUTER:

Computer with high-speed internet access

FITNESS:

State-of-the-art fitness center in One River Court and cardio machines set up in the bridge overpass

GRILLS: DECK:

Grills with picnic tables set up outside Outdoor deck with café tables Elevator access in One River Court Additional storage in 24 Oak Street

ELEVATOR: STORAGE: PARKING: ACCESS: SPRINKLERS: GAZEBO: BIKE PATH: TRASH SHOOTS:

Well-lit parking lot with 130 +/- parking spaces Controlled access entrance and security cameras Trash shoots on the upper floors of One River Court

Fully sprinklered

Gazebo by the Powwow River

Steps away from the 1.3 mile Amesbury Riverwalk rail trail. This trail will eventually be connected to a 30-mile network of trails to be developed in Amesbury, Salisbury, Newbury, and Newburyport

FLOOR PLANS: SAMPLE LAYOUT

PROPERTY OVERVIEW

LOCATION OVERVIEW

Powwow River

24 OAK STREET ONE RIVER COURT 24 Oak Street has frontage on the Powwow River. One River Court has river views on one side. Both buildings have off-street parking and easy access to the scenic Amesbury Riverwalk Bike Path.

Gazebo

River Court

Oak Street

THE PEDESTRIAN WALKWAY AND BIKE PATH provides a “greenway” along the old Boston and Main rail bed from Amesbury’s historic downtown Upper Millyard and Market Square to the Carriagetown Marketplace. There is a plan to connect this 1.3 mile rail trail with a 30-mile network of trails to be developed in Amesbury, Salisbury, Newbury, and Newburyport.

In recent years many industrial mills in New England have been converted to residential apartment buildings. Renovated mills offer a combination of historical charm and modern amenities that are attractive to residents.

QUAINT SUBURBAN COMMUNITY

Amesbury is located 43 miles north of Boston and is bordered by Merrimac, Salisbury, Newburyport, West Newbury, and New Hampshire. Amesbury was settled in 1645 and its earliest industries included mills, shipyards, and a ferry boat operation on the Merrimac River. Most colonial settlements of the time relied exclusively on agriculture but Amesbury had both agriculture and a strong maritime and industrial economy. This maritime industry later gave way to textiles, iron works, and other manufacturers that established mills along the Powwow River. The Residences at Riverwalk was home to a carriage maker and later an auto body manufacturing company. Amesbury’s industrial base formed the backbone of the city and its history is still celebrated today.

Downtown Amesbury offers visitors and residents an eclectic mix of shops, galleries, and restaurants.

AMESBURY IS WELL-LOCATED AT THE CROSSROADS OF I-495 AND I-95 OFFERING HIGHWAY ACCESS WEST TO LOWELL AND WORCESTER, NORTH TO PORTSMOUTH, NH AND SOUTH TO BOSTON. The Residences at Riverwalk is conveniently located close to both interstate highways. I-495 is only 1.8 miles from the property and accessible via Route 110. The Residences at Riverwalk are 1.6 miles from I-95.

The Residences at Riverwalk are close to restaurants and shopping in downtown Amesbury as well as the Carriagetown Marketplace anchored by Super Stop & Shop on Route 110.

The MBTA commuter train is located approximately 7.2 miles (15 minutes) away in Newburyport. The train station has a large parking lot and provides direct access to Boston in a little over one hour.

LOCATION OVERVIEW

THE RESIDENCES AT RIVERWALK OFFER MANY RECREATIONAL OPPORTUNITIES. State and local parks (Maudslay & Batchelder Park) are located in Amesbury and the Atlantic Ocean is only a short drive away. Hampton Beach, Salisbury Beach, and Plum Island are all close to the Residences at Riverwalk. Also, some of the best skiing in New England is only a few hours’ drive north.

All the recreational amenities of this area are enhanced by its proximity to Boston. Commuters can travel from Amesbury to Boston by car or train in little over an hour.

APARTMENT SALES SURVEY

PROPERTY NAME & ADDRESS

EXETER MILLS EXETER, NH

CHADWICK ARMS READING, MA

KIMBALL COURT WOBURN, MA

VILLAGE AT TAYLOR POND BEDFORD, MA

STONE BROOK FARMS WILMINGTON, MA

PRICE

$30,000,000

$16,200,000

$47,875,000

$49,050,000

$40,250,000

DATE

6/22/2012

12/11/2012

3/15/2012

2/5/2013

12/13/2012

# OF UNITS

161

256

188

203

PRICE/UNIT

$186,335

$176,086

$187,012

$260,904

$198,276

CAP RATE

6.7%

4.94%

Not available

5.2%

4.95%

NOTES

Converted mill buildings near downtown Exeter

Brick garden- style apartment complex; 100% occupied at closing

Class A brick apartment building located in Woburn, MA

Class A apartment complex built in 2008; expansion potential

Class A apartment complex; 98% occupied at closing

MARKET OVERVIEW

REGENCY PLACE WILMINGTON, MA

HAWTHORN COMMONS SALEM, MA

RIVER POINTE LAWRENCE, MA

$24,400,000

$41,800,000

$26,350,000

3/20/2012

11/17/11

4/15/2011

120

228

174

$203,333

$183,333

$151,437

5.6%

5.75%

Class A brick apartment

Class A property built in 2002, 96% leased at the time of sale

Class A complex built in 1999. The 174 units are comprised of 94 (54%) 1-beds, 68 (39%) 2-beds, and 12 (7%) 3-bedroom apartments with an average unit size of 925 SF.

complex with 30 affordable units and 90 market rate units

APARTMENT RENTAL SURVEY

PROPERTY NAME & ADDRESS

THE CORDOVAN AT HAVERHILL STATION HAVERHILL, MA

HAMEL MILL LOFTS HAVERHILL, MA

RESIDENCES AT PORTWALK PORTSMOUTH, NH

RESIDENCES AT RIVERWALK

EXETER MILL EXETER, NH

MILL FALLS METHUEN, MA

1 BED- ROOM PRICE

$1,289 - $1,595

$1,215 - $1,945

$1,225 - $1,645

$1,244

$1,978

$1,020 - $1,122

SIZE (SF)

660 - 980

625 - 1,010

765 - 785

798

750

563 - 918

RENT $/SF/ YR

$1.63 - $1.95

$1.94

$1.60 - $2.10

$1.56

$2.63

$1.22 - $1.81

2 BED- ROOM

$1,475 - $2,275

$1,435 - $2,670

$1,820 - $2,120

$1,710

$2,911

$1,225 - $1,428

SIZE (SF)

826 - 1368

1,056

1,838

1,070

1,030

695 - 1,119

RENT $/SF/ YR

$1.66 - $1.79

$1.36 - $2.53/SF

$0.99 - $1.15/SF

$1.60/SF

$2.82

$1.28 - $1.76

1616

MARKET OVERVIEW

CONDOMINIUM SURVEY

ADDRESS UNIT #

25 CEDAR STREET - AMESBURY (CLARKS POND)

UNIT TYPE

2-bed / 1-bath 1-bed / 1-bath 2-bed / 1-bath

PRICE

$217,500 (ask)

$215,000

$381,000

LIVING AREA (SF)

1036

1,137

1,908

$/SF

$210

$189

$200

STATUS

UNDER AGREEMENT

SOLD 8/24/12

SOLD 1/11/13

ADDRESS

15 CEDAR STREET - AMESBURY

UNIT #

UNIT TYPE

1-bed / 1-bath 2-bed / 1-bath 2-bed / 1-bath

2-bed / 1-bath

1-bed / 1-bath

PRICE

$205,000

$295,000

$225,000

$217,000

LIVING AREA (SF)

879

951

1,411

1,043

1,061

$/SF

$233

$215

$209

$216

$205

STATUS

SOLD 3/7/2013

SOLD 9/25/2012 SOLD 1/30/2012

SOLD 6/19/2013

SOLD 7/17/13

ADDRESS UNIT #

75 MAIN STREET - AMESBURY (CLARKS POND)

205

301

101

302

UNIT TYPE

1-bed / 1-bath

2-bed / 1-bath

1-bed / 1-bath

2-bed / 1-bath

PRICE

$170,000

$243,000

$192,000 (ask)

$259,900 (ask)

LIVING AREA (SF)

855

1,175

795

1095

$/SF

$199

$206

$241

$237

STATUS

SOLD 1/4/2013

SOLD 7/9/2012

FOR SALE

ADDRESS UNIT #

60 MERRIMAC STREET - AMESBURY

806

905

701

UNIT TYPE

2-bed / 2-bath

1-bed / 2-bath

PRICE

$390,000

$430,000

$395,000

LIVING AREA (SF)

1261

1507

1495

$/SF

$309

$285

$264

STATUS

SOLD 6/14/2013

SOLD 1/14/2013

SOLD 3/11/2013

1717

RENT ROLL: ONE RIVER COURT

UNIT #

FLOOR

TYPE

SIZE (SF)

BEDS

BATHS

STATUS

$/MONTH ( JULY)

$/SF

101

1,060

Occupied

$1,776

$1.68

102

1,060

Occupied

$1,776

$1.68

103

1,060

Occupied

$1,776

$1.68

104

1,060

Occupied

$1,750

$1.65

105

1,055

Model

$1,725

$1.64

106

1,055

Occupied

$1,901

$1.80

107

K HP

1,045

1.5

Occupied

$1,595

$1.53

108

727

Occupied

$1,411

$1.94

109

E HP

1,000

1.5

Occupied

$1,573

$1.57

110

L HP

888

Occupied

$1,370

$1.54

111

E HP

1,000

1.5

Occupied

$1,573

$1.57

112

1,060

Occupied

$1,776

$1.68

113

K HP

1,045

1.5

Occupied

$1,619

$1.55

114

1,060

Occupied

$1,776

$1.68

115

1,055

Occupied

$1,826

$1.73

116

1,060

Occupied

$1,776

$1.68

117

1,060

Occupied

$1,776

$1.68

118cr

1,048

Occupied

$1,800

$1.72

119cr

1,048

Occupied

$1,878

$1.79

201cr

980

Occupied

$1,595

$1.63

202cr

1,047

Occupied

$1,825

$1.74

203

1,060

Occupied

$1,776

$1.68

204

1,060

Occupied

$1,776

$1.68

205

1,060

Occupied

$1,776

$1.68

206

1,060

Occupied

$1,776

$1.68

207

1,055

Vacant

$1,769

$1.68

208

1,060

Occupied

$1,776

$1.68

1818

FINANCIAL ANALYSIS

UNIT #

FLOOR

TYPE

SIZE (SF)

BEDS

BATHS

STATUS

$/MONTH (JULY)

$/SF

209

727

Occupied

$1,411

$1.94

210

1,060

Occupied

$1,700

$1.60

211

727

Occupied

$1,411

$1.94

212

727

Occupied

$1,596

$2.20

213

660

Occupied

$1,289

$1.95

214

826

1.5

Occupied

$1,475

$1.79

215

660

Occupied

$1,289

$1.95

216

1,012

Occupied

$1,675

$1.66

217

727

Occupied

$1,411

$1.94

218

1,060

Occupied

$1,776

$1.68

219

727

Occupied

$1,411

$1.94

220

1,060

Occupied

$1,750

$1.65

221

1,055

Occupied

$1,786

$1.69

222

1,060

Occupied

$1,750

$1.65

223

1,060

Occupied

$1,976

$1.86

224cr

1,048

Occupied

$1,878

$1.79

225cr

1,048

Occupied

$2,000

$1.91

301cr

1,205

Occupied

$1,990

$1.65

302cr

1,047

Occupied

$2,120

$2.02

303

1,060

Occupied

$1,868

$1.76

304

1,060

Occupied

$1,915

$1.81

305

1,060

Occupied

$1,990

$1.88

306

1,060

Occupied

$1,840

$1.74

307

1,055

Occupied

$1,842

$1.75

308

1,060

Rented

$1,840

$1.74

309

727

Occupied

$1,482

$2.04

310

1,060

Occupied

$1,944

$1.83

1919

RENT ROLL: ONE RIVER COURT

UNIT #

FLOOR

TYPE

SIZE (SF)

BEDS

BATHS

STATUS

$/MONTH (JULY)

$/SF

311

727

Occupied

$1,482

$2.04

312

727

Occupied

$1,528

$2.10

313

660

Occupied

$1,360

$2.06

314

826

1.5

Occupied

$1,629

$1.97

315

660

Occupied

$1,360

$2.06

316

1,012

Rented

$1,842

$1.82

317

727

Occupied

$1,482

$2.04

318

M 1,060

Occupied

$1,840

$1.74

319

727

Occupied

$1,482

$2.04

320

M 1,060

Occupied

$1,840

$1.74

321

1,055

Vacant

$1,840

$1.74

322

M 1,060

Occupied

$1,840

$1.74

323

M 1,060

Occupied

$2,768

$2.61

324cr

1,048

Occupied

$1,900

$1.81

325cr

1,048

Occupied

$2,335

$2.23

66,923

$119,465

$1.80

2020

FINANCIAL ANALYSIS

2121

RENT ROLL: 24 OAK STREET

UNIT #

FLOOR

TYPE

SIZE (SF)

BEDS BATHS STATUS

$/MONTH $/SF

Ground & 1st

Duplex

1,145

Occupied $1,920

$1.68

Ground & 1st

Duplex

1,201

Occupied $1,775

$1.48

Ground & 1st

Duplex

1,216

Occupied $1,985

$1.63

Ground & 1st

Duplex

1,216

Occupied $1,905

$1.57

Ground & 1st

Duplex

1,147

Occupied $1,620

$1.41

Ground & 1st

Duplex

1,127

Occupied $1,700

$1.51

Ground & 1st

Duplex

1,107

Occupied $1,820

$1.64

Ground & 1st

Duplex

1,179

Rented

$1,850

$1.57

Ground & 1st

Duplex

1,150

Occupied $2,020

$1.76

1st & 2nd

Duplex

1,499

Occupied $2,725

$1.82

1st & 2nd

Duplex

1,365

Occupied $2,220

$1.63

1st & 2nd

Duplex

1,363

Occupied $2,150

$1.58

1st & 2nd

Duplex

1,363

Vacant

$2,220

$1.63

1st & 2nd

Duplex

1,368

Vacant

$2,220

$1.62

1st & 2nd

Duplex

1,368

Vacant

$2,220

$1.62

1st & 2nd

Duplex

1,368

Occupied $2,320

$1.70

1st & 2nd

Duplex

1,368

Vacant

$2,213

$1.62

1st, 2nd, Loft

Triplex

2,116

Occupied $2,430

$1.15

23,666

$37,313

222

FINANCIAL ANALYSIS

RENT ROLL: TOTALS

ONE RIVER COURT

RENTED

95.7

VACANT

4.3

24 OAK STREET

RENTED

77.8%

VACANT

22.2%

TOTALS

OCCUPIED

91.95%

VACANT

8.05%

2323

FINANCIAL ANALYSIS

ASSUMPTIONS

ASSUMPTIONS:

$/UNIT

$198,276

BUILDING AREA

Purchase Price

$17,250,000

INFLATION RATE APPLICABLE TO REVENUES INFLATION RATE APPLICABLE TO EXPENSES TERMINAL CAP RATE (APPLIED TO YEAR 2014 NOI)

2.50% New Mortgage Loan Amount

$13,800,000

2.50% Loan-to-Value Ratio

80.0%

7.25% Interest Rate on Mortgage Loan

4.25%

TRANSACTION COSTS

3.00% Amortization Period of Mortgage Loan (Years)

EQUITY INVESTOR'S REQUIRED RATE OF RETURN (LEVERAGED)

12.0% Loan Origination Fee

2424

PRO FORMA ANALYSIS

VACANCY

RATE

9.06%

7.50%

5.00%

YEAR 1

YEAR 2

YEAR 3

YEAR 4

YEAR 5

YEAR 6

START:

SEP-2013

SEP-2014

SEP-2015

SEP-2016

SEP-2017

SEP-2018

CASH FLOW LINE ITEM

END:

AUG-2014 AUG-2015 AUG-2016 AUG-2017

AUG-2018 AUG-2019

GROSS POTENTIAL RENT

BASE RENTAL REVENUE

$1,881,336 $1,928,369 $1,976,579 $2,025,993

$2,076,643 $2,128,559

VACANCY & TURNOVER LOSS

(170,484)

(144,628)

(98,829)

(101,300)

(103,832)

(106,428)

SCHEDULED BASE RENTAL REVENUE

$1,710,852 $1,783,742 $1,877,750 $1,924,693

$1,972,811 $2,022,131

OTHER RENTAL INCOME

13,597

13,937

13,598

13,938

13,599

13,939

EFFECTIVE GROSS REVENUE

$1,724,449 $1,797,679 $1,891,348 $1,938,631

$1,986,410 $2,036,070

OPERATING EXPENSES:

YEAR 1

YEAR 2

YEAR 3

YEAR 4

YEAR 5

YEAR 6

% OF EGR

$/UNIT

ADMINISTRATIVE

3.14%

$622

54,076

55,428

56,814

58,234

59,690

61,182

MARKETING/ADVERTISING

1.88%

$373

32,434

33,245

34,076

34,928

35,801

36,696

PAYROLL & BENEFITS

13.02%

$2,581

224,560

230,174

235,928

241,827

247,872

254,069

ELECTRICITY

1.84%

$365

31,745

32,539

33,352

34,186

35,041

35,917

WATER & SEWER

1.03%

$204

17,774

18,218

18,674

19,141

19,619

20,110

GAS

0.51%

$101

8,802

9,022

9,248

9,479

9,716

9,959

OPERATING & MAINTENANCE *

5.11%

$1,014

88,200

90,405

92,665

94,982

97,356

99,790

REAL ESTATE TAXES

9.47%

$1,877

163,259

167,340

171,524

175,812

180,207

184,713

INSURANCE

2.61%

$517

44,995

46,120

47,273

48,455

49,666

50,908

TOTAL OPERATING EXPENSES

38.61%

$7,653

$665,845

$682,491

$699,553

$717,042

$734,968

$753,343

NET OPERATING INCOME

$1,058,604 $1,115,187 $1,191,794 $1,221,589

$1,251,441 $1,282,728

CASH FLOW BEFORE DEBT SERVICE

$1,058,604 $1,115,187 $1,191,794 $1,221,589

$1,251,441

INTEREST PAYMENT

582,003

571,920

561,401

550,426

538,975

PRINCIPAL PAYMENT

232,650

242,732

253,252

264,227

275,678

CASH FLOW AFTER DEBT SERVICE

$243,952

$300,535

$377,142

$406,937

$436,789

GROSS SALE PRICE

$17,692,793

TRANSACTION COSTS

$530,784

OUTSTANDING LOAN BALANCE

$12,531,462

NET REVERSION UPON SALE

$4,630,548

INVESTMENT PERFOMANCE MEASURES

AUG-2014 AUG-2015 AUG-2016 AUG-2017

AUG-2018

9/1/2013

CASH-ON-CASH RETURN ON EQUITY

7.1%

8.7%

10.9%

11.8%

12.7%

DEBT COVERAGE RATIO

1.30

1.37

1.46

1.50

1.54

GOING-IN CAPITALIZATION RATE

6.1%

*Note: Operating expenses are based on 2012 actual expenses. Two items were adjusted for this proforma. The actual Administrative Expense was $91,076, but included a non-recurring expense of $37,000 for an Audit. This amount was removed from our proforma. In addition Operating & Maintenance was $109,893 for 2012. A non-recurring charge of $21,693 for Decorating Supplies was removed from our proforma.

INVESTMENT PRESENT VALUE

$17,521,799

INTERNAL RATE OF RETURN

13.9%

2525

Carl Christie Executive Vice President/ Principal 617.457.3394 cchristie@naihunneman.com Dan McGee Sales Associate 617.457.3266 dmcgee@naihunneman.com Henry D. Lieber Sales Associate 617.457.3383 hlieber@naihunneman.com

All information furnished regarding property for sale or lease is from sources deemed reliable, but no warranty or representation is made as to the accuracy thereof and same is submitted subject to errors, omissions, change of price, rental or other conditions prior to sale or lease, or withdrawal without notice. 303 Congress Street | Boston, MA 02210 | 617.457.3400 | www.naihunneman.com

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