2nd 2015 NM Spaceport Appraisal

APPRAISAL REPORT

OF:

A Vacant Tract of Land Located at:

The Northwest Corner of Sanford Wilson Rd. & H.R. Ashbaugh Dr. Truth or Consequences, NM 87901

Market Value As Is Effective January 23, 2015

For: New Mexico Spaceport Authority

c/o Mr. Ryan T. Noble, General Counsel 901 E. University Ave., Suite 965L

Las Cruces, NM 88001

By: Dominion Property Advisors

1429 Central Ave. NW, Suite #1 Albuquerque, New Mexico 87104

February 27, 2015 New Mexico Spaceport Authority c/o Mr. Ryan T. Noble, General Counsel 901 E. University Ave., Suite 965L Las Cruces, NM 88001 575.373.6110 Re: Appraisal of a vacant tract of land located at:

The northwest corner of Sanford Wilson Rd. & H.R. Ashbaugh Dr. Truth or Consequences, NM 87901 (Dominion Job No. 14-205-665)

Dear Mr. Noble: At your request, we made an inspection of the above-referenced property and investigated the current real estate market in order to provide an opinion of market value as is of the fee simple interest in the subject property. The intended use of the appraisal report is to provide an opinion of market value for decision related to potential asset acquisition. Your attention is directed to the Assumptions and Limiting Conditions, found in the Introduction, which identify the scope and use of this report. This appraisal report is intended to comply with the reporting requirements set forth under the Uniform Standards of Professional Appraisal Practice (USPAP) and/or guidelines of the Appraisal Institute. The extent of research and scope of the project have been clearly outlined in the Scope of Work section of this report. The report is a brief recapitulation of the appraisers data, analysis, and conclusions consistent with the reporting guidelines of Standards Rule 2-2 (a) and is intended to meet the appraisal requirements of the Financial Institution Recovery Reform and Enforcement Act of 1989 (12 U.S.C. 331-3351). Supporting documentation is retained in the appraisers file. The appraisal is also intended to be in compliance with the Code of Professional Ethics of the Appraisal Institute. A copy of your letter of authorization and list of appraisal instructions has been included in the addenda. The appraisers are unbiased with respect to the parties involved and have no present or contemplated future interest in the property appraised. Accordingly, statements of fact are, to the best of our knowledge, correct, and compensation for making this appraisal is not contingent on the value conclusions reported herein. Furthermore, this appraisal was not based on a requested minimum valuation, a specific valuation, or the approval of a loan. Based on the data and analysis presented herein, the following is our opinion of market value as is of the fee simple interest in the subject property, effective January 23, 2015: Market Value As Is: $1,045,000 THE ABOVE MARKET VALUE CONCLUSION IS QUALIFIED BY THE GENERAL ASSUMPTIONS AND LIMITING CONDITIONS SET FORTH IN THIS REPORT.

Mr. Ryan T. Noble New Mexico Spaceport Authority February 27, 2015 Page 2 Respectfully submitted, DOMINION PROPERTY ADVISORS LLC BRIAN D. WHITE, MAI, CCIM GENERAL CERTIFIED APPRAISER, NM #756-G ANTHONY KUNA GENERAL CERTIFIED APPRAISER, NM #03041-G JARED C. MICHNOVICZ APPRENTICE APPRAISER, NM #03048-A

TABLE OF CONTENTS

PREFACE Executive Summary Maps/Site Surveys/Floor Plans Photographs of the Subject Property

INTRODUCTION 4Overview of the Appraised Property 4Legal Description 4History of the Subject Property 4Scope of the Assignment 4Intended Use/Intended User(s) 5Market Value Defined 5Property Rights Defined 5Marketing Time 5Effective Dates of Appraisal 6

LIMITING CONDITIONS AND ASSUMPTIONS 7DESCRIPTION AND ANALYSIS 11

Summary T or C / Sierra County Profile 11Immediate Neighborhood 14Site Description 15Building Description 16Highest and Best Use 17

VALUATION 18Sales Comparison Approach 18

RECONCILIATION OF VALUE INDICATIONS 38CERTIFICATION 39ADDENDA

Flood Plain Map Qualifications of the Appraiser Engagement Letter

Dominion Property Advisors

EXECUTIVE SUMMARY Subject: A vacant tract of land Location: NWC of Sanford Wilson Rd. & H.R. Ashbaugh Dr. Truth or Consequences, NM 87901 Client: New Mexico Spaceport Authority c/o Mr. Ryan T. Noble, General Counsel 901 E. University Ave., Suite 965L Las Cruces, NM 88001 Site Area: 6.0 acres or 261,360 SF Site Description: The site is mostly level, rectangular in shape and

above street grade along the west side of H.R. Ashbaugh Dr.

Site Improvements: None Zoning: C-1 Flood Zones: Zone X Property Rights Appraised: Fee Simple Highest and Best Use: As Is: Hold for future development Value Conclusions: Market Value As Is: $1,045,000 Effective Dates: Market value as is effective January 23, 2015. The

date of this report is February 27, 2015.


REGIONAL MAP


CITY MAP


NEIGHBORHOOD MAP


AERIAL VIEW

Note: property lines are approximate and are for illustration purposes only.


SUBJECT SURVEY


SUBJECT PHOTOS

Subject site looking north from south property line

Subject site looking northwest from southeast corner


Location of proposed visitor center building. Billboard to be removed.

Street scene looking east along Sanford Wilson Rd.


Street scene looking north along H.R. Ashbaugh Dr.

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INTRODUCTION Overview of the Appraised Property The subject of this appraisal is a vacant tract of land containing a total site area of 6.0 acres fronting the northwest corner of Sanford Wilson Rd. and H.R. Ashbaugh Dr. in Truth or Consequences, NM. The subject also has good visibility and substantial frontage along the west side of Interstate 25. The subject propertys metro address has not yet been determined. This report will provide opinions of market value as is and hypothetical market value as if complete of the fee simple interest in the subject property, effective January 23, 2015.

Legal Description According to Sierra County records, the subject is legally defined as follows:

Parcel 2, New Hot Springs Retail Center as recorded September 26, 2013 in Book 122, Page 1736, Sierra County, NM within Section 28, Township 13 South, Range 4 West, NMPM.

History of the Subject Property Ashbaugh Construction Co. Inc. has owned the subject property for approximately 10 years. The subject has been under contract since October 2012 to sell to New Mexico Spaceport Authority for $1,045,440 or $4/SF. Based on the research and analysis contained herein, we believe the subjects current contract purchase price, despite being negotiated more than two years ago, is representative of market value. We noted a billboard located on the subjects west property line (frontage along Interstate 25); however, we were not provided details regarding the billboard lease. We were informed that this billboard was to be razed upon purchase of the subject site to make way for a New Mexico Spaceport visitors center. The buyer (New Mexico Spaceport Authority) was planning to construct a visitor center for the New Mexico Spaceport at a reported cost of approximately $4,848,048 or $762.99/SF (based on gross square footage of 6,354 SF). The proposed building was intended to serve as a visitor center, ticketing center and embarking facility for transport to Spaceport America for guided tours; however, Virgin Galactic's suborbital space plane SpaceShipTwo suffered a serious malfunction during a rocket-powered test flight over Mojave, California on October 31, 2014 resulting in the loss of the spacecraft. The New Mexico Spaceport, a $220 million facility owned by the State of New Mexico located roughly 15 miles southeast of Truth or Consequences, has been completed; however, commercial space flights by Virgin Galactic have been delayed indefinitely due to recent events. As such, the New Mexico Spaceport Authority has postponed plans to develop the proposed visitors center indefinitely. To the best of our knowledge there has been no other real estate activity pertaining to the subject property in the last three years.

Scope of the Assignment The assignment is to provide an opinion of market value as is of the fee simple interest in the subject property and to deliver an appraisal report of our findings and conclusions. This document is an Appraisal Report consistent with reporting requirements of the Uniform Standards of Professional Appraisal Practice (USPAP). The appraisers have:

Made a physical appraisal inspection of the subject property as well as a visual inspection of the surrounding neighborhood.

Relied on a visual inspection of the site and reviewed Sierra County Assessor records in order to identify documented or apparent easements, restrictions or encroachments.

Concluded a highest and best use.

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researched and collected relevant vacant land sales data, derived appropriate adjustments and reconciled sales data and subsequent analysis into a credible indication of market value as is for the subject site via the sales comparison approach.

Excluded the cost approach as the subject site is vacant. Excluded the income approach as vacant parcels similar to the subject are rarely leased in the

subjects immediate market area and sales of ground-leased parcels are virtually non-existent; Reconciled all data and analysis into a final opinion of market value as is for the subject property.

The appraisal report is intended to conform to the guidelines of the Appraisal Institute. The report is a recapitulation of the appraisers data, analysis, and conclusions consistent with the reporting guidelines of Standards Rule 2-2 (a). Supporting documentation is retained in the appraisers file.

Intended Use/Intended User(s) The intended user of this report is New Mexico Spaceport Authority. The report is intended for use by New Mexico Spaceport Authority as an aid in decisions related to asset acquisition. This appraisal may not be used or relied upon by any individual or entity other than the client for whom it was prepared.

Market Value Defined Market value means 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 are 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 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 US dollars or in terms of financial arrangements

comparable thereto. 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. Source: Department of the Treasury, Office of the Comptroller of the Currency, 12 CFR Part 34 [Docket No. 90-16], Real Estate

Appraisals, published in the Federal Register, Vol. 55 No. 165, August 24, 1990: Final Rule.

Property Rights Defined The fee simple ownership right is being appraised in this assignment as the subject is not currently encumbered by any lease agreements. The fee simple estate is defined as:

Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat. Source: The Dictionary of Real Estate Appraisal, 5th Edition, Appraisal Institute, Chicago, 2010, p. 78)

Marketing Time A reasonable exposure time is the amount of time, leading up to the date of market value, necessary to expose a property to the open market in order to achieve a sale. Marketing periods for similar sales of this

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type of property typically range from a few to 12 months. In our opinion, less than 12 months is a reasonable exposure time for the subject under current market conditions. The projected marketing time is the length of time it would probably take to sell the subject placed on the market as of the appraisal date. If placed on the market and appropriately priced, we believe there is a high likelihood the subject would sell within less than three years. During the foreseeable future, we project that the marketing time for the subject should be equal to or lower than the estimated exposure time, i.e., less than three years. Effective Dates of Appraisal Our most recent inspection of the subject property was January 23, 2015; therefore, the effective date of market value as is is January 23, 2015. The date of this report is February 27, 2015.

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LIMITING CONDITIONS AND ASSUMPTIONS The appraisal described and contained herein is expressly limited and conditioned upon the terms, assumptions and other matters contained in this section entitled "Limiting Conditions and Assumptions." Said limiting conditions and assumptions are hereby incorporated into the appraisal in their entirety by this reference. Appraisal Report This document represents an Appraisal Report as stated in Standards Rule 2-2 (a). This appraisal report is intended to

comply with the reporting requirements set forth under Standards Rule 2-2 (a) of the Uniform Standards of Appraisal Practice (USPAP) for an appraisal report. The scope of this report has been detailed in the Scope of Work section which clearly outlines approaches used to estimate value.

A. Scope of the Appraisal Dominion Property Advisors ("Appraiser"), acting herein by and through its authorized appraisers, have been retained

by the Client to provide an opinion of market value as is of the fee simple interest in the Property, which opinion is fully set forth in the Appraisal. In compiling the Appraisal, the Appraisers have relied upon information provided to them by the Client. The assumptions which have been made concerning the Appraisal include the foregoing and other specific assumptions more particularly set forth in the Appraisal. The Appraisers have not independently verified all of the information furnished to them or assumptions made with respect to the Appraisal unless otherwise indicated by the Appraisers and therefore are not responsible for their content or their effect on the Market Value of the Property.

B. Intended Use of the Appraisal The Appraisers have been engaged by the Client to provide an opinion of market value as is of the fee simple interest

in the Property for making a credit decision in a real estate transaction. Any other use of the Appraisal without the prior written consent of the Appraisers is strictly forbidden. Any unauthorized use of the Appraisal will render the Appraisal null and void and of no force or effect.

C. Severability No portion of the Appraisal may be reproduced in whole or in part without the prior written consent of the Appraisers. D. Copies, Publication, Distribution, Use and Ownership of Report Possession of this report or any copy thereof does not carry with it the right of publication, nor may it be used for other

than its intended use; the physical report(s) remain the property of Dominion Property Advisors for the use of the client, the fee being for the analytical services only.

The Bylaws and Regulations of the Appraisal Institute require each Member and Candidate to control the use and

distribution of each appraisal report signed by such Member or Candidate; this appraisal report shall not be given to third parties without the prior written consent of the signatories of this appraisal report. Neither all nor any part of this appraisal report shall be disseminated to the general public by use of advertising media, public relations, news, sales or other media for public communication without the prior written consent of Dominion Property Advisors.

E. Other Services The Appraisers have not been engaged to fulfill any services other than those set forth in the discussions with the lender,

the terms and conditions of which are hereby incorporated herein by this reference. The Appraisers are not obligated to provide any other services, including but not limited to, testimony in court or before any other body charged with interpretation of enforcement of the Appraisal. The Appraisers shall not provide any post-appraisal consultations with

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the Client or other parties without the payment of additional fees of the Appraiser's normal hourly rates for such services then in effect.

If Appraisers shall be required to provide any testimony pursuant to any subpoena, Client shall pay any costs and expenses

associated with such testimony, which shall include, but not be limited to, reasonable attorneys' fees and compensation of the Appraisers at their normal hourly fee.

F. Real Estate Values Due to the nature of real estate valuation and the complexities of external and internal factors which dictate the Market

Value and Prospective Market Value of any real estate, and the rapid changes and fluctuations with respect to the valuation of real estate, the opinion of the Appraisers set forth in the Appraisal concerning the Market Value of the Property is reliable as of the Effective Date and should not be considered as reliable at any time thereafter.

G. No Guarantee or Warranty The Appraisers make no guarantee or warranty, whether implied or expressed, concerning the Market Value and

Prospective Market Value set forth in the Appraisal. The Appraisal merely set forth the Appraisers opinions of such Market Values based upon information submitted by the Client and assumptions made by the Appraisers with respect to the Property.

H. Americans with Disabilities Act "ADA" The appraisers have not made or been furnished with a specific compliance study to determine if the subject property

(existing and or proposed) is in compliance with the specialized requirements of the ADA. It is possible that the subject property is not in compliance with the ADA requirements which became effective in January of 1992. This could negatively impact the market value of the subject property and any such finding might require revision of this appraisal and its market value estimate. Unless evidence is furnished to the contrary, the appraiser assumes compliance. It is recommended that the Client obtain an expert opinion in regard to the specific requirements of the ADA.

I. Legal, Engineering, Financial, Structural or Mechanical Components; Nature, Hidden or Unapparent Conditions, and

Soil No responsibility is assumed for matters legal in character or nature, or matters of survey, nor of any architectural, structural, mechanical or engineering nature. No opinion is rendered as to the title of the subject property, which is presumed to be good and merchantable. The Property is appraised as if free and clear, unless otherwise stated in particular parts of the report. The legal description is assumed to be correct as used in this report as furnished by the client, his designee, or as derived by the Appraisers.

Please note that no advice is given regarding mechanical equipment or structural integrity or adequacy, nor soils and

potential for settlement, drainage and such (seek assistance from qualified architect and/or engineer), nor matters concerning liens, title status, legal marketability and such (seek legal assistance). The lender and owner should inspect the Property before any disbursement of funds; further it is likely that the lender or owner may wish to require mechanical or structural inspections by a qualified and licensed contractor, civil or structural engineer, architect, or other expert.

The Appraisers have inspected as far as possible, by observation, the land and the improvements; however, it was not

possible to personally observe conditions beneath the soil or hidden or unapparent structural, or other components. We have not critically inspected mechanical components within the improvements and no representations are made herein as to these matters unless specifically stated and considered in the report. The value estimate considers there being no such conditions that would cause a loss of value. The land or the soil of the area being appraised appears firm, however subsidence in the area is unknown. The Appraisers do not warrant against this condition or the occurrence of problems arising from soil conditions.

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The Appraisal is based on there being no hidden, unapparent, or apparent conditions of the property site, subsoil, or structures or toxic materials which would render it more or less valuable. No responsibility is assumed for any such conditions or for any expertise or engineering to discover them. All mechanical components are assumed to be in operable condition and status standard for properties of the subject type. Conditions of heating, cooling, ventilating, electrical and plumbing equipment is considered to be commensurate with the condition of the balance of the improvements unless otherwise stated. No judgment is made as to adequacy of insulation, type of insulation or energy efficiency of the improvements or equipment.

If the Appraisers have not been supplied with a survey, no responsibility or representation is assumed or made for any

costs associated with obtaining same or for any deficiencies discovered before or after they are obtained. No representation or warranties are made concerning obtaining the above mentioned items.

The Appraisers assume no responsibility for any costs or consequences arising due to the need, or the lack of need for

flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to determine the actual need for flood hazard insurance.

J. Legality of Use The Appraisal is based on the premise that there is full compliance with all applicable federal, state and local

environmental regulations and laws unless otherwise stated in the report; further that all applicable zoning, building and use regulations and restrictions for all types have been complied with unless otherwise stated in the report; further, it is assumed that all required licenses, consents, permits or other legislative or administrative authority, local, state, federal and/or private entity or organization have been or can be obtained or renewed for any use considered in the value estimate.

K. Subsurface Rights Subsurface Rights (minerals and oil) were not considered in this Appraisal unless otherwise specifically stated. L. Insulation and Toxic Materials Unless otherwise stated in this report, the Appraisers signing this report have no knowledge concerning the presence or

absence of any toxic materials and/or urea-formaldehyde foam insulation in existing improvements; if such is present, the value of the property may be adversely affected and re-appraisal at additional cost may be necessary to estimate the effects of such.

M. Terms of Sale and Full Disclosure The State of New Mexico does not have full disclosure laws regarding real estate transactions. Therefore, the Appraisers

had to confirm all sales and rental comparables with brokers, property managers, mortgage brokers, grantors, grantees and other parties familiar with the transaction. The Appraisers' results are limited by the accuracy of the information supplied by the aforementioned individuals. Whenever possible, the information was verified by county records.

N. Environmental Hazard Notice Comprehensive federal and state laws and regulations have been enacted in the last few years in an effort to develop

controls over the use storage, handling, clean-up, removal and disposal of hazardous wastes or substances. Some of these laws and regulations, such as the so-called "Superfund Act," provide for broad liability schemes wherein an owner, tenant or other use of the property may be liable for clean-up costs and damages regardless of fault. Other laws and regulations set standards for the handling of asbestos or establish requirements for the use, modification, abandonment, or closing of underground storage tanks.

It is not practical or possible to list all such laws and regulations in this Notice. Therefore, owners, buyers, tenants, and

lenders involved with the property which is the subject of this report, and any other use and/or uses of this report are urged to consult legal counsel to determine their respective rights and liabilities with respect to the proposed transactions

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involving the subject of this appraisal. If hazardous wastes or substances have been, or are going to be used, or if underground storage tanks are present, it is essential that legal and technical advice be obtained in determining, among other things, what permits and approvals have been or may be required, if any, estimated costs and expenses associated with the use, storage, handling, clean-up, removal or disposal of the hazardous wastes or substances, and what contractual provisions and protections are necessary or desirable. It may also be important to obtain expert assistance for site investigations and building inspections. The past uses of the property may provide valuable information as to the likelihood of hazardous wastes or substances, or underground storage tanks being on the property.

We have not made investigations or obtained reports regarding the subject matter of this Notice, except as may be

specifically described within the body of this appraisal. We make no representations regarding the existence or non-existence of hazardous wastes or substances, or underground storage tanks on the property. The user and/or users of this report should contact a professional, such as a civil engineer, geologist, industrial hygienist or other persons with experience in these matters to provide advice concerning the property.

The term "hazardous wastes or substances" is used in this Notice in its very broadest sense and includes, but is not limited

to, petroleum based products, paints and solvents, lead, cyanide, DDT, printing inks, acids, pesticides, ammonium compounds, asbestos, PCB's and any storage tanks that may be present on all types of real property. This Notice is, therefore, meant to apply to any type of real property, whether improved or unimproved.

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DESCRIPTION & ANALYSIS TRUTH OR CONSEQUENCES/SIERRA COUNTY PROFILE Geographic Area The City of Truth or Consequences (T or C) was incorporated in 1916 under the name Hot Springs. In 1950, the people of Hot Springs voted to change the citys name to Truth or Consequences after Ralph Edwards, an NBC television and radio producer, called for a city to name itself after the then popular radio program Truth or Consequences on its 10th anniversary. The city has a population of approximately 6,700 and encompasses an area of about 13 square miles. The elevation averages 4,242' above sea level and the city enjoys a moderate climate. T or C is located between Las Cruces and Albuquerque along Interstate 25 and is renowned for its moderate climate, recreational facilities and its hot springs mineral waters. The Elephant Butte Reservoir, which is the primary recreational destination for water activities for people from Albuquerque and especially southern New Mexico, attracts a steady amount of seasonal tourism from year to year. Many retirees have begun to relocate to T or C and a national publication, Where to Retire, just named the city one of the top retirement destinations in the United States. Sierra County is also the home of Spaceport America, the nations first purpose-built commercial space facility which is currently under construction. Population Trends Sierra County population grew from approximately 4,619 in 1920 to approximately 7,186 in 1950 then experienced a net population gain of 6,084 persons over the next 50 years, peaking in 2000 at 13,270. The University of New Mexico Bureau of Business and Economic Research (BBER) projected Sierra County population growth over the next 30 years, estimating a 2015 population of 13,793 and a 2020 population of 13,887. These projections appear optimistic as both Sierra County and Truth or Consequences have exhibited a downward trend in population since 2000. Population growth in T or C, Sierra County and the state of New Mexico from 1970 to 2012 is shown in the following chart: Historical and Projected Population Data: 1970 2012 (most recent)

T or C Annual Sierra County Annual New Mexico AnnualYear Population Total Growth Rate* Population Total Growth Rate* Population Total Growth Rate*

Historical1970 4,656 7,189 1,017,0551980 5,219 1.15% 8,454 1.63% 1,303,303 2.51%1990 6,224 1.78% 9,912 1.60% 1,515,069 1.52%2000 7,276 1.57% 13,303 2.99% 1,828,596 1.90%2001 7,173 -1.42% 13,173 -0.98% 1,851,525 1.25%2002 7,039 -1.87% 13,042 -0.99% 1,874,593 1.25%2003 7,096 0.81% 12,910 -1.01% 1,897,658 1.23%2004 6,986 -1.55% 12,778 -1.02% 1,920,756 1.22%2005 6,861 -1.79% 12,647 -1.03% 1,943,827 1.20%2006 6,744 -1.71% 12,515 -1.04% 1,966,890 1.19%2007 6,681 -0.93% 12,383 -1.05% 1,989,996 1.17%2008 6,784 1.54% 12,251 -1.07% 2,013,064 1.16%2009 6,468 -4.66% 12,120 -1.07% 2,036,124 1.15%2010 6,491 0.36% 11,955 -1.36% 2,065,195 1.43%2011 6,481 -0.15% 11,967 0.10% 2,078,674 0.65%2012 6,411 -1.08% 11,895 -0.60% 2,085,538 0.33%

Projected2015 - - 12,020 -1.44% 2,208,450 2.73%2020 - - 12,048 0.05% 2,351,724 1.27%

*annual compound rate of growth Source: US Bureau of the Census, BBER-UNM

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Projections from BBER anticipate nearly flat growth in Sierra County through 2020. Based on historical population growth in the region over the last 40 years, we expect modest population growth over the next 20 years. Employment Trends The following table shows historical overall employment in Sierra County, the state of New Mexico and the United States from 1994 through 2012. Historical Employment Information (Civilian Labor Force)

Sierra County New Mexico United States # % Unemploy. # % Unemploy. # % Unemploy.

Year Emp. Change Rate Emp. Change Rate *Emp Change Rate2000 5,041 - 4.4% 810,024 - 5.0% 137,614 - 4.0%2001 5,126 1.69% 4.7% 821,003 1.36% 4.9% 136,047 -1.14% 4.7%2002 5,063 -1.23% 5.4% 823,191 0.27% 5.5% 136,426 0.28% 5.8%2003 5,031 -0.63% 5.6% 835,835 1.54% 5.9% 138,411 1.46% 6.0%2004 5,048 0.34% 5.9% 849,970 1.69% 5.8% 140,125 1.24% 5.5%2005 5,131 1.64% 5.4% 870,288 2.39% 5.2% 142,752 1.87% 5.1%2006 5,162 0.60% 4.4% 896,359 3.00% 4.2% 145,914 2.22% 4.6%2007 5,378 4.18% 3.3% 912,167 1.76% 3.5% 146,173 0.18% 4.6%2008 5,668 5.39% 4.1% 919,466 0.80% 4.2% 143,188 -2.04% 5.8%2009 5,647 10.06% 5.2% 873,960 0.42% 6.8% 137,792 -3.47% 9.3%2010 5,563 -1.49% 6.2% 861,503 -3.89% 7.9% 139,064 0.92% 9.6%2011 5,534 2.90% 6.4% 862,043 -5.50% 7.5% 139,869 0.58% 8.9%2012 5,544 -2.19% 6.2% 871,299 -5.24% 6.8% 142,469 -0.50% 8.1%Average 1.77% 5.17% -0.12% 5.63% 0.13% 6.31% Sierra County has experienced relatively stable unemployment since 2000 with an increase reported in 2009 concurrent with the recession; however, the unemployment rate in 2012 remains below the state and national averages.

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Employed Persons According to Categories: Sierra County 2001 2011 AVERAGE ANNUAL COVERED WAGE AND SALARY EMPLOYMENT# BY MAJOR INDUSTRIAL SECTORSIERRA COUNTY

Sector 2004 2005 2006 2007 2008 2009 2010 2011Grand Total 2,803 2,891 2,962 3,031 3,287 3,247 3,285 3,183Total Private 1,876 1,993 2,075 2,166 2,395 2,351 2,392 2,310 Ag. For. Fish. & Hunting 192 D D D D D 284 D Mining 0 D D D D D 6 D Utilities D D D D D D D D Construction 127 147 198 262 303 259 257 253 Manufacturing 90 108 119 127 128 112 121 85 Wholesale Trade D D D D D D D 10 Retail Trade 300 303 314 335 420 456 441 434 Transportation & Warehousing 17 18 19 17 16 9 8 D Information 17 15 17 15 14 20 18 24 Finance & Insurance 68 68 65 67 72 71 68 66 Real Estate & Rental & Leasing 27 37 31 21 25 25 22 19 Professional & Technical Services 132 159 149 151 134 86 70 61 Management of Companies & Enterprises 0 0 0 0 0 0 0 0 Administrative & Waste Services 10 13 12 14 23 41 29 19 Educational Services D D D D D D D D Health Care & Social Assistance D D D D D D D D Arts, Entertainment & Recreation 33 36 41 D D D 40 52 Accommodation & Food Services 376 393 380 D D D 402 404 Other Services, ex. Public Administration 79 79 59 64 69 65 77 74 Unclassified 0 0 0 0 0 0 0 0Total Government 927 898 887 865 893 896 893 873 Federal 119 108 103 98 115 122 126 121 State 306 306 305 287 291 291 278 259 Local 502 484 479 479 487 483 489 493

Note: All years have been revised in accordance with U.S. Dept. of Labor, Bureau of Labor Statistics, databases.

# Data are by location of the employer's establishment and represent counts of workers covered by New Mexico unemployment insurance (UI) law and related statutes. For a complete definition of covered employment see the attached definition sheet.

D Withheld to avoid disclosing confidential data. Data that are not disclosed for individual industries are always included in the totals. Therefore, the individual industries may not sum to the totals.

Source: U.S. Dept. of Labor, Bureau of Labor Statistics, Quarterly Census of Employment and Wages.

Table prepared by: Bureau of Business and Economic Research, University of New Mexico. Source: BBER

Approximately 68% of all employment is related to the private sector with retail trade and accommodations and food services commanding approximately 43% of 2011 private sector employment. Sierra County receives a significant amount of seasonal tourism, so we would expect accommodations and food services and retail trade to command a significant amount of employment. Sierra County has a large amount of government employment as a result of containing three state parks. Classifying the medical service providers is more difficult due to both the local and regional nature of the services. City government and the school districts are non-basic industries as are restaurants and most retail establishments.

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New Develoment

Sierra County is the host of Spaceport America, a $220 million project, which is the nations first purpose-built commercial space facility. Spaceport America has the potential to bring a significant amount of economic activity to Sierra County and surrounding areas. In its winter newsletter, Spaceport America reports that local contractors have confirmed 467 jobs at work with an additional 150 to 300 anticipated as the Terminal Hangar Facility once other remaining project elements come online. Spaceport America has been working closely with companies such as Virgin Galactic, Lockheed Martin and UP Aerospace. Designed, built and operated by the New Mexico Spaceport Authority (NMSA), Spaceport America has completed the first phase of construction, which includes basic operational infrastructure such as an airfield, launch pads, terminal / hangar facility, emergency response capabilities, utilities and roadways. The site is= capable of accommodating the activities of both vertical and horizontal takeoff space launch vehicles, serving as the base for pre-flight and post-flight activities, and providing a tourism experience for interested visitors and spectators. As noted in the Subject History, commercial space flight operations have been postponed indefinitely. Per Capita Income Per Capita Income has exhibited considerable increases in the last several years and is summarized in the following table: Per Capita Income: Sierra County 2000 2011 (most recent)

Year Income % Change2000 $17,174 -2001 $18,165 5.8%2002 $18,057 -0.6%2003 $18,092 0.2%2004 $19,476 7.6%2005 $20,488 5.2%2006 $21,866 6.7%2007 $24,020 9.9%2008 $29,562 23.1%2009 $29,853 1.0%2010 $31,653 6.0%2011 $32,794 3.6%

Source: UNM-BBER

Gross Receipts: City of Truth or Consequences 2004 through 2013 (most recent)

Year Gross Receipts % Change2004 $99,094,251 -2005 $96,320,005 -2.8%2006 $447,180,346 364.3%2007 $136,778,568 -69.4%2008 $131,682,760 -3.7%2009 $135,896,377 3.2%2010 $141,998,595 4.5%2011 $136,874,827 -3.6%2012 $141,164,561 3.1%2013 $137,676,670 -2.5%

Source: Bureau of Business and Economic Research, Gross Receipts 2004-2013 (most recent)

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Summary Truth or Consequences/Sierra County Profile Overall, Truth or Consequences/Sierra Countys economy appears to be generally stable and has remained relatively sheltered from the national recession. Conversations with real estate professionals familiar with the Truth or Consequences market indicate that seasonal tourism remains strong and that property values for both residential and commercial properties have remained relatively stable over the past couple of years. The outlook for Truth or Consequences is for modest appreciation in value for all types of real estate as the surrounding communities continue to grow and expand. The New Mexico Spaceport should provide a significant boon to the local economy if and when it becomes fully operational.

Immediate Neighborhood The subject property is located near the north city limits of Truth or Consequences, NM. The neighborhood boundaries are as follows:

North: Truth or Consequences City Limits East: Truth or Consequences City Limits South: W. Marie St. West: Interstate 25

Major land uses or developments affecting the neighborhood: Major Development: Truth or Consequences Middle School WalMart Supercenter Truth or Consequences Elementary School Surrounding Development: Commercial development in the subjects neighborhood consists

of several freestanding retail properties, a self-storage facility, full and quick service restaurants, a limited service hotel, multi-family residential properties and an ample supply of vacant developable land. Relatively recent development along N. Date St consists of a newer limited service hotel and a Wal-Mart Supercenter located north of the subject property. Older, average quality single-family residential development is located south and east of the subjects neighborhood along minor collector streets intersecting N. Date St.

Neighborhoods are typically characterized as being in one of four life cycle stages: growth, stability, decline and revitalization. The immediate neighborhood is approximately 50% built out with an ample supply of vacant land available for development. The subjects neighborhood is considered to be within the stabilization phase of its life cycle as growth has been minimal in recent years. All factors considered, the subjects neighborhood appears to be stabilized and the outlook for the neighborhood is for continued stabilization, with intermittent periods of modest growth as demand warrants.

Site Description Address: TBD NWC of Sanford Wilson Rd. & H.R. Ashbaugh Dr. Truth or Consequences, NM 87901

Access: The subject is immediately accessible via two curb cuts along the west side of H.R. Ashbaugh Dr. General access to the site is average as the subject

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fronts a minor collector street in close proximity to N. Date St. which provides access to Interstate 25 less than one-quarter mile to the north.

Frontage/Depth: The subject has approximately 368 of frontage along the west side of H.R. Ashbaugh Dr. and roughly 710 of depth to the west.

Site Area: 6.0 acres or 261,360 SF Shape: Slightly irregular. Topography: Generally level and above street grade along the west side of H.R.

Ashbaugh Dr. Zoning: C-1 Commercial District. Allowable uses include strip and free-standing

retail, assembly spaces, professional and medical office and industrial uses. The subjects proposed use is legally conforming.

Drainage: On-site run off appears to generally flow toward the subjects east property line.

Flood Zones: The subject site is located on FIRM #3500730005C, effective July 16, 1996 and lies within Flood Zone X, areas determined to be outside the 0.1% annual chance floodplain (refer to the addenda of this report for a copy of the subjects flood plain map).

Soils: We were not provided with a soils analysis for the subject site; however, we noted no signs of structural shifting caused by soil conditions associated with the subject or surrounding development.

Utilities: All public utilities are located long the subjects east property line. Easements: We were not provided with a title report for review; however, according

to the warranty deeds filed with Sierra County, the subject site is encumbered by typical perimeter easements. We noted several shared access easements along the subjects east property line. None of the easements are considered adverse.

Encumbrances: The subject property is being appraised as though free and clear of all liens and financial encumbrances.

Landscaping: Average Environmental: No adverse environmental conditions were noted upon visual inspection

of the subject site as confirmed by the Phase I environmental survey which was provided by the buyer.

Parking: None Property Taxes:

Parcel # 16585 - Fee Simple ParcelTax Year 2013 Land Improvements TOTAL Assessed Value: $654,555 - $654,555 Taxable Value: $218,185 Property Tax: 24.392 Mills $5,322.00

PROPERT TAX SUMMARY

Property taxes are current and paid in full as of January 23, 2015. The

subjects current and historic property tax information is included in the addenda for reference. The subject appears to be under-assessed relative

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to the opinion of market value concluded herein; therefore, contesting is not recommended. We noted that the assessment above pertains to subdivided parcels 1 and 2 (subject) which have not yet been assessed separately by the Sierra County Assessors office.

Floor Area Ratio: N/A Site Improvements: None

Highest and Best Use As Is:

The subject site is comprised of a single tract of land containing approximately 6.0 acres. Most types of development typically found on sites of this size are physically possible as the site is generally level and has a workable configuration. The subjects C-1 Commercial District zoning allows for several types of commercial development including professional and medical office, assembly buildings, strip retail and full and quick-service restaurants and are approved on a case-by-case basis by the City of Truth or Consequences. As a result, legally permissive uses are fairly numerous. The economy in Truth or Consequences appears to be stable but the overall lack of population and employment growth do not bode well of the local economy. The subject has a good location anchored by Wal-Mart Supercenter in a relatively high demand area within Truth or Consequences. We noted some retail vacancy upon visual inspection of the subjects neighborhood. Speculative investment-grade development is not feasible due to the lack of supporting population and difficulty in obtaining favorable financing for such projects. For the aforementioned reasons, any financially feasible development would need to be built-to-suit or for owner-occupancy. The subject property is situated within an area primarily characterized by big box, professional office, freestanding and strip retail uses. The principle of conformity holds that a propertys value is maximized by conforming to surrounding development. Therefore, the maximally productive use of the subject site is for commercial/retail use; however, as previously noted, the lack of supporting population precludes most large-scale commercial/retail development at this time. Based on an analysis of physically possible, legally permissible, financially feasible and maximally productive uses; we believe the highest and best use of the subject site is for to hold for future development.

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VALUATION Sales Comparison Approach The Sales Comparison Approach is based on sales of vacant tracts of land from which units of physical comparison have been extracted. Our data set includes six sales and two current listings of vacant tracts located in the subjects market area. We have made quantitative adjustments to the comparable sales depicted in the adjustment grid below; however, considering the differences between the subjects market and the markets of the comparable set, making quantitative adjustments to the comparable sales is somewhat subjective considering the wide range of physical and locational characteristics. We have therefore converted qualitative adjustments to quantitative percentage adjustments using the following as a guide. A detailed discussion of each adjustment is presented on the following page.

Qualitative Adjustment Quantitative Adjustment

Far Inferior/Superior = +/- 15% + Inferior/Superior = +/- 10% < to 15% Slightly Inferior/Superior = +/-5% < to 10% Similar = 0%

The following chart summarizes the comparable sales data:

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Land Comparables Summary and Adjustment Grid Sale/Listing No. Subject Property Sale 1 (Subject) Sale 2 Sale 3 Sale 4 Sale 5 Sale 6 Listing 1 Listing 2

Sale Price - $1,045,440 $17,000 $257,000 $600,000 $750,000 $264,023 $1,500,000 $650,000 Sale Date - U/C Jul-14 Jul-12 Oct-11 Aug-09 Jun-09 N/A Listing N/A ListingLand Area (SF) 261,360 261,360 6,098 73,616 108,508 51,706 50,099 261,360 237,837Land Area (Acres) 6.0000 6.00 0.14 1.69 2.49 1.19 1.15 6.00 5.46Zoning C-1 C-1 C-1 C-1 C-1 C-1 C-1 C-1 C-1Sale/List Price per SF - $4.00 $2.79 $3.49 $5.53 $14.51 $5.27 $5.74 $2.73Property Rights Conveyed - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Adjusted Sale Price/SF - $4.00 $2.79 $3.49 $5.53 $14.51 $5.27 $5.74 $2.73Financing - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Adjusted Sale Price/SF - $4.00 $2.79 $3.49 $5.53 $14.51 $5.27 $5.74 $2.73Conditions of Sale - 0.0% 0.0% 35.0% 0.0% 0.0% 0.0% -25.0% 10.0%Adjusted Sale Price/SF - $4.00 $2.79 $4.71 $5.53 $14.51 $5.27 $4.30 $3.01Expenditures After Sale - 0.0% 0.0% 0.0% 0.0% 4.0% 0.0% 0.0% 0.0%Adjusted Sale Price/SF - $4.00 $2.79 $4.71 $5.53 $15.09 $5.27 $4.30 $3.01Market Conditions - 0.0% 0.0% 0.0% 0.0% -15.0% -15.0% 0.0% 0.0%Adjusted Sale Price/SF - $4.00 $2.79 $4.71 $5.53 $12.82 $4.48 $4.30 $3.01Adjustments: Location: - 0.0% 25.0% 0.0% 0.0% -20.0% 0.0% 0.0% 0.0% Size: - 0.0% -10.0% -10.0% -10.0% -10.0% -10.0% 0.0% 0.0% Topography/Configuration: - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 20.0% Utilities: - 0.0% 0.0% 0.0% 0.0% -10.0% 0.0% 0.0% 0.0% Zoning: - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Net Adjustment - 0.0% 15.0% -10.0% -10.0% -40.0% -10.0% 0.0% 20.0%Adjusted Sale Price per SF - $4.00 $3.21 $4.24 $4.98 $7.69 $4.03 $4.30 $3.61

Median Adjusted Sale Price $4.14Average Adjusted Sale Price $4.51

1980 N. Date St., Truth or Consequences, NM


Location Parcel 2, New Hot Springs Retail Center, Truth or Consequences, NM


I-25 Hubble, Tract 4, Truth or Consequences, NM

Lot 1, Block 2, New Hot Springs Retail Center, Truth or Consequences, NM

2201 F. G. Amin St., Truth or Consequences, NM

Parcel 2, New Hot Springs Retail Center, Truth or Consequences, NM

SWC Broadway St. and Clancy St., Truth or Consequences, NM

Quantitative Adjustments: Property Rights Conveyed:

All comparable sales conveyed fee simple interest. As we are appraising the fee simple interest in the subject, no adjustments were made. Financing:

There were no reported factors related to financing that had an impact on prices paid among the comparables; therefore, no adjustments were made. Conditions of Sale

Adjustments for conditions of sale usually reflect the motivations of the buyer and the seller. Circumstances surrounding a sale may influence the price in such a manner that the buyer and seller act under conditions that cause the price to be other than typical market conditions. Special conditions of sale may include a favorable price given to a relative or business partner buying the property, a quick sale at below market

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prices to generate cash for the seller under duress, or a premium price paid by a developer to complete an assemblage. All sales are considered to have occurred under normal conditions of sale; therefore, no adjustment was necessary. Listings 1 and 2 are only asking prices. Properties rarely sell at full asking price and we have seen sale prices ultimately fall anywhere from 5% to 15% below asking prices. Listing 1 appears to be listed well above market based on an analysis of competitive sales and a conversation with the listing broker; therefore, a sizable downward adjustment was made. Listing 2 was listed for $950,000 or $3.99/SF for approximately one year before the seller lowered the asking price to $2.73/SF (32%) in January 2015. The most recent asking price appears slightly below market value as it falls below the range exhibited by the comparables and reflects the high motivation of the seller to move the property, according to the listing broker; therefore, an upward adjustment was made. Expenditures Subsequent to Purchase:

None of the comparable sales required expenditures subsequent to purchase and did not require adjustment. Market Conditions: Market conditions can change between the date of sale and the effective date of appraisal. Property values can fluctuate in response to changing market conditions resulting from factors such as inflation, deflation or supply and demand. The dates of sale range from June 2009 to July 2014 with two active listings and one currently under contract (subject). Market conditions from 2011 to present have remained relatively stable as very few land sales transact in any given year in the subjects market; therefore, no adjustments were made to Sales 1 through 4. Sale 5 and 6 transacted under superior market conditions due to the fact that the tangible onset of the national recession began to affect property values in 2010. Based on conversations with real estate professionals familiar with the vacant land market in Truth or Consequences, market conditions from 2009 to present have fallen by approximately 15%; therefore, downward adjustments were made to Sales 5 and 6. Qualitative Adjustments: Location: The subject is located in close proximity to the Wal-Mart Supercenter. Sales 1, 3, 4 and 6 and Listing 1 exhibit similar locations in close proximity to Wal-Mart Supercenter and are considered similar to the subject with regard to location. Sale 2 fronts the southwest corner of two secondary arterials within Downtown Truth or Consequences and is not anchored by a national retailer; therefore, Sale 2 is considered far far inferior to the subject with regard to location. Sale 5 is anchored by Wal-Mart Supercenter and is considered superior to the subject with regard to location due to its superior frontage along T or Cs primary retail corridor. While Listing 2 also has an address on N. Date St. and is anchored by Wal-Mart Supercenter, the majority of the site is located one lot set-back from N. Date St.; therefore, it exhibits a similar location as the subject property. Size Adjustment: Typically, larger parcels of land sell for less per square foot or unit than do smaller ones. All things being equal, smaller parcels benefit from a much larger pool of potential buyers creating a greater demand and driving prices upward. All comparable sales, save Sale 1 (subject) and Listings 1 and 2, are superior to the subject with regard to size. Sale 1 (subject) and Listings 1 and 2 are similar to the subject with regard to size. Topography/Configuration: Typically, vacant tracts of land that undulate or are moderately to severely sloped will sell for a lower price per unit than sites that are relatively flat and at street grade. Sloping and undulating properties increase development costs as a result of increased earthwork needed to create a workable building pad and/or the

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need for retaining walls. Properties with irregular configurations may not be conducive to all development types. The subject is generally level and has a workable configuration which is conducive to development. All comparables, save Listing 1, are similar to the subject with regard to topography and configuration. Listing 1 is extremely undulate and is considered far inferior to the subject with regard to topography. Utilities: All comparables, save Sale 5, are similar to the subject with regard to utilities as their respective utilities are located at their lot lines. Sale 5 has utilities extended to the interior of the site and is superior to the subject with regard to utilities. Zoning: The subjects C-1 zoning allows for retail, professional/medical office, some industrial and outdoor storage uses and is considered one of the least restrictive zoning designations in Truth or Consequences. The subjects zoning designation is considered similar to all comparable sales. Market Value Indication from Competitive Sales The comparable sales range from $3.21/SF to $7.69/SF. We have applied percentage adjustments to the comparables based on qualitative ratings, as outlined above, and the resultant adjusted average of the comparable set is $4.51/SF. Furthermore, we have considered the subjects contract purchase price of $1,045,440 or $4/SF, which is well bracketed by the comparable set and falls slightly below the average exhibited by the comparable set. Additionally, we have analyzed the comparables, adjusted only for property rights conveyed, financing, conditions of sale, expenditures and market conditions, which exhibit a range from $2.79/SF to $12.82/SF. The comparable sales are considered good relative to market activity and provide a credible indication of market value for the subject site as is. All factors considered, we have placed the subject in its most likely position based on the overall comparability ratings of the comparable sales as follows:

RANKING ANALYSIS Sale No. Sale Price/SF Overall Comparability

5 $12.82 Far Superior 4 $5.53 Superior 3 $4.71 Superior 6 $4.48 Superior

Listing 1 $4.30 Similar Sale 1 - Subject $4.00 Similar

Listing 2 $3.01 Slightly Inferior 2 $2.79 Far Inferior

We have ranked the subject property in its most likely position based on the ranking analysis above. The subject is most similar to Sale 6 (rated superior) and Listings 1 and 2 (rated similar and slightly inferior, respectively), as they exhibit generally similar zoning and locations compared to the subject. Our opinion of market value as is is $4/SF summarized as follows:

Unit Value $4/SF Square Feet 261,360 Indicated Market Value As Is $1,045,440 Market Value As Is (rounded) $1,045,000

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COMPARABLE SALES MAP

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RECONCILIATION OF VALUE INDICATIONS A single approach to value has been employed in this appraisal to provide an opinion of market value as is. The data collected for and subsequent analysis of the cost approach has been detailed and presented. The value indications are as follows: Market Value As Is (Vacant Land):

Cost Approach $1,045,000Sales Comparison Approach N/AIncome Approach N/A

The sales comparison approach gains strength from its close association with the actions of buyers and sellers in the marketplace and with the definition of market value. Although Truth or Consequences, NM has a somewhat limited amount of market activity for vacant land in any given year, the comparable sales are considered good and representative of current market conditions. Therefore, the sales comparison approach provides the most credible indication of market value in this instance. The sales comparison approach will be given sole consideration in this appraisal. Additionally, we have considered the subjects current contract purchase price of $1,045,000, which we believe to be representative of market value. Our opinion of market value as is of the fee simple interest in the subject property (effective January 23, 2015) is as follows:

Market Value As Is ONE MILLION FORTY-FIVE THOUSAND DOLLARS

($1,045,000)

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CERTIFICATION The undersigned certify that, to the best of our knowledge and belief:

the statements of fact contained in this report are true and correct. the reported analyses, opinions, and conclusions are limited only by the reported assumptions and

limiting conditions, and are our personal, unbiased professional analyses, opinions and conclusions. 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. we have no bias with respect to the property that is the subject of this report or to the parties

involved with this assignment. our engagement in this appraisal assignment was not contingent upon developing or reporting

predetermined results. 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.

Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.

Anthony Kuna and Jared Michnovicz have made a personal inspection of the property that is the subject of this report.

we certify that we have not provided any other services regarding the subject property as an appraiser or in any other capacity within the past three years.

Anthony Kuna and Jared Michnovicz provided significant real property appraisal assistance to the person signing this certification.

we certify that the use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

As of the date of this report, Anthony Kuna has completed the Standards and Ethics education Requirements for Candidates of the Appraisal Institute.

As of the date of this report, Brian D. White, MAI has completed the continuing education program for designated members of the Appraisal Institute.

This opportunity to provide appraisal services to your organization is appreciated, and questions from authorized users of the report will be welcomed if any aspect of the research or analysis requires clarification. DOMINION PROPERTY ADVISORS BRIAN D. WHITE, MAI, CCIM ANTHONY M. KUNA GENERAL CERTIFIED APPRAISER, NM #756-G GENERAL CERTIFIED APPRAISER, NM #03041-G JARED C. MICHNOVICZ APPRENTICE APPRAISER, NM #03048-A

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ADDENDA

26

FLOOD MAP

BACKGROUND AND EXPERIENCE BRIAN D. WHITE, MAI, CCIM

PRESENT POSITION

Owner, Dominion Property Advisors, Albuquerque, New Mexico

CONTACT INFORMATION 505.878.9400 Direct 505.259.8672 Cell505.878.9700 Fax [email protected]

EDUCATION

University of North Texas, Denton, Texas Bachelor of Business Administration Majors: Real Estate and Real Estate Finance

REAL ESTATE COURSE WORK

Real Estate Principles Real Estate Law Real Estate Appraisal Real Estate Investments Real Estate Development Subdivision Analysis Appraisal Principles Basic Valuation Procedures Capitalization Theory Part A Capitalization Theory Part B Standards of Professional Practice Part A Standards of Professional Practice Part B Special Use Property Valuation

EXPERIENCE

Appraisal/Consulting

Brian D. White has completed various commercial appraisal and consulting assignments involving properties located in the Southeastern and Southwestern United States. He has worked independently and with various MAI designated appraisers. Prior to being active in New Mexico, Mr. White was active as a fee appraiser in the Dallas/Fort Worth Metroplex with prestigious firms such as the Wilson K. Mason Company, McRoberts & Company and the Jay Massey Company for approximately seven years. Clients served included individuals, Fortune 500 corporations, banks and

other lending institutions, government agencies, life insurance companies and attorneys. Estates appraised included fee simple, leased fee, leasehold and subleasehold. Property types appraised included the following:

Retail Buildings Freestanding, Strip and Big Box Office Buildings Professional, Medical and Dental Multi-Family Residential Apartment Properties Light Industrial Facilities - Office/Warehouses and Distribution Warehouses Flex/Research and Development Facilities Single Family Residential Subdivisions Single Family and Commercial Condominiums Vacant Land Commercial, Residential, Agricultural and Ground Leased Restaurants Full and Quick Service Gasoline Stations Houses of Worship Truck Terminals MarinasNumerous Mixed Use Developments Other Special Purpose Properties

Financial Industry

Mr. White has also been active as a specialized real estate consultant with two of the top financial institutions in the country for a combination of nearly 10 years. These two financial institutions are Bank of America/Amresco in Dallas. Texas, and Norwest Bank/Wells Fargo in New Mexico. His professional duties with Bank of America/Amresco were as a review appraiser and a marketing/transactional consultant for both operating properties and liquidation properties within an REO portfolio. His professional duties with Norwest Bank/Wells Fargo were as a staff appraiser, review appraiser, appraisal manager and real estate consultant and trainer for loan officers within the institution. He also served as a voting member and consultant for the Loan Committee. Mr. White qualifies as an expert witness in real estate disputes and recently played a critical role in reducing his clients damages by more than $6 million. He has owned and operated Dominion Property for over eight years.

AFFILIATIONS

Member, Appraisal Institute-MAI (No. 10,773) New Mexico General Certified Appraiser (No. 000375-G) Commercial Investment Real Estate Institute-CCIM (No. 8,261) Texas State Real Estate Salesman-Inactive Status

ANTHONY M. KUNA BACKGROUND AND EXPERIENCE

PRESENT POSITION Staff Appraiser, Dominion Property Advisors, Albuquerque, NM CONTACT INFORMATION 505.883.8477 Direct 505.710.7097 Cell 505.878.9700 Fax [email protected] EDUCATION Bachelor of Business Administration Anderson School of Management University of New Mexico, Albuquerque, New Mexico Major: International Business Management REAL ESTATE COURSE WORK APPRAISAL INSTITUTE Basic Appraisal Principles Basic Appraisal Procedures General Income Approach Part I General Income Approach Part II Advanced Income Capitalization Advanced Concepts and Case Studies Highest and Best Use and Market Analysis The Appraiser as an Expert Witness EXPERIENCE Anthony Kuna has quickly become one of the most respected commercial real estate appraisers in New Mexico under the mentorship of Brian D. White, MAI. Anthony has demonstrated a superior aptitude for commercial appraisal over his eight years in the industry as a result of an intense workload often involving complex properties with unique components of value. Anthony has earned his NM General Certification and is currently enrolled in the Appraisal Institutes MAI Designation program. Property types appraised include the following: Office Buildings Professional, Medical and Dental Retail Buildings Freestanding, Strip and Big Box Light Industrial Facilities Office/Warehouse, Distribution Warehouse Heavy Manufacturing and Food Processing Facilities Multi-Family Residential Apartment Properties Hotels - Limited Service, Full Service (Independent and Franchised) Tax Income Credit Properties Single Family Residential Subdivisions (Urban and Rural) Commercial Subdivisions Non-Profit Medical Treatment Facilities

Farm/Ranch Properties Houses of Worship Veterinary Clinics/Hospitals Restaurants - Full Service, Quick Service Gasoline Stations/Convenience Stores Bed & Breakfast Properties Vacant Land - Commercial, Residential, Agricultural, Ground Leased Car Washes - Self Service/Full Service

RV/Campground Facilities

AFFILIATIONS New Mexico General Certified Appraiser Associate Member of the Appraisal Institute

Prior Professional Experience Facilities Coordinator Ericsson Wireless Communications, San Diego, California 2000-2003 Responsibilities: Managed corporate travel program for the business unit. Assisted nine departments with various facilities-related services including short and long-term space planning activities, administrative support services, workers compensation claims and ergonomic requirements.

Jared C. Michnovicz BACKGROUND AND EXPERIENCE

PRESENT POSITION Apprentice Appraiser, Dominion Property Advisors, Albuquerque, New Mexico CONTACT INFORMATION 505.217-0430 Direct 505.249-1044 Cell 505.878.9700 Fax [email protected]

EDUCATION 2 Years Undergraduate Work TVI 1 Year Undergraduate Work Austin Community College Relevant Course Work: Business Administration Economics Statistics REAL ESTATE COURSE WORK Uniform Standards of Professional Appraisal Practice Basic Appraisal Principles Basic Appraisal Procedures General Appraiser Sales Comparison Approach

EXPERIENCE Jared has completed the aforementioned courses to become a certified apprentice appraiser in the State of New Mexico. In addition, through his role as market research analyst at Dominion Property Advisors, Jared has been exposed to numerous appraisal techniques for a wide variety of property types where he has observed what he learned in the classroom applied. Additionally, Jared has been trained and mentored by Brian D. White, MAI, CCIM and Anthony M. Kuna, General Certified Appraiser as well as other appraisers at Dominion Property Advisors. Finally, Jareds undergraduate education has proved to be a valuable asset for being an apprentice appraiser, and it has greatly benefited Jared to exhibit a superior aptitude for commercial appraisal. AFFILIATIONS New Mexico Registered Apprentice Appraiser (License #03048-A) Prior Professional Experience Apprentice Appraiser Dominion Property Advisors, Albuquerque, NM February 2011 Current Responsibilities: Market, sale, lease, vacancy, absorption, expense and other forms of data collection and

analysis in Albuquerque and throughout New Mexico. Assisted Brian D. White, MAI, CCIM and Anthony M. Kuna on site and building inspections and prepared and cosigned appraisal reports. Market Research Analyst Dominion Property Advisors, Albuquerque, NM April 2007 December 2010 Responsibilities: Market, sale, lease, vacancy, absorption, expense and other forms of data collection and analysis in Albuquerque and throughout New Mexico. Assisted Brian D. White, MAI, CCIM and Anthony M. Kuna on site and building inspections and aided in the preparation of appraisal reports. Sales Training Manager CitiCards Customer Service/Sales, Albuquerque, NM Man 2005 March 2007 Responsibilities: Training the customer service/sales staff in sales techniques and methods. Wrote several curriculums pertaining to sales techniques and methods for use at CitiCards.

Dominion Property Advisors, 2014

AGREEMENT FOR PROFESSIONAL VALUATION SERVICES Parcel 2, New Hot Springs Retail Center, Truth or Consequences, Sierra County, NM DATE OF AGREEMENT: 1/23/2015 PARTIES TO AGREEMENT: Client: Appraiser: New Mexico Spaceport Authority Anthony Kuna, Managing Member c/o Mr. Ryan T. Noble, General Counsel Dominion Property Advisors 901 E. University Ave, Suite 965L 1429 Central Ave. NW, Suite 1 Las Cruces, NM 88001 Albuquerque, NM 87104 Phone: (575) 373-6110 505.710.7097 (C) Fax: (575) 373-6120 505.878.9700 (F) [email protected] [email protected] Client hereby engages Appraiser to complete an appraisal assignment as follows: PROPERTY IDENTIFICATION Parcel 2, New Hot Springs Retail Center as recorded 26 September, 2013 in Book 122 Page 1736, Sierra County, NM within the Section 28, Township 13 south, Range 4 west, NMPM. PROPERTY TYPE Vacant Land INTEREST VALUED Fee Simple INTENDED USERS New Mexico Spaceport Authority Note: No other users are intended by Appraiser. Appraiser shall consider the intended users when determining the level of detail to be provided in the Appraisal Report.


INTENDED USE To assist Client in establishing fair market value for the subject property. TYPE OF VALUE Market value As Is as defined by the appraisal requirements pursuant to FIRREA DATE OF VALUE Current HYPOTHETICAL CONDITIONS, EXTRAORDINARY ASSUMPTIONS None anticipated, to be detailed in transmittal letter if appropriate APPLICABLE REQUIREMENTS OTHER THAN THE UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE (USPAP) The Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute ANTICIPATED SCOPE OF WORK Site visit On-site inspection Valuation approaches Sales Comparison Approach Note: Appraiser shall use all approaches necessary to develop a credible opinion of value. APPRAISAL REPORT Report option Appraisal Report as defined by USPAP Standards Rule 2-2 (a) Form or format: Narrative CONTACT FOR PROPERTY ACCESS, IF APPLICABLE N/A DELIVERY DATE On or before January 30, 2015. DELIVERY METHOD Fully executed digital PDF copy. NUMBER OF COPIES: N/A


PAYMENT TO APPRAISER $4,000 (including NMGRT @ 7%) PROPOSED IMPROVEMENTS If the property appraised consists of proposed improvements, Client shall provide to Appraiser plans, specifications, or other documentation sufficient to identify the extent and character of the proposed improvements. PROPERTIES UNDER CONTRACT FOR SALE If the property appraised is currently under contract for sale, Client shall provide to Appraiser a copy of said contract including all addenda. CONFIDENTIALITY Appraiser shall not provide a copy of the written Appraisal Report to, or disclose the results of the appraisal prepared in accordance with this Agreement with, any party other than Client, unless Client authorizes, except as stipulated in the Confidentiality Section of the ETHICS RULE of the Uniform Standards of Professional Appraisal Practice (USPAP). CHANGES TO AGREEMENT Any changes to the assignment as outlined in this Agreement shall necessitate a new Agreement. The identity of the client, intended users, or intended use; the date of value; type of value; or property appraised cannot be changed without a new Agreement. CANCELLATION Client may cancel this Agreement at any time prior to the Appraisers delivery of the Restricted Appraisal Report upon written notification to the Appraiser. Client shall pay Appraiser for work completed on assignment prior to Appraisers receipt of written cancellation notice, unless otherwise agreed upon by Appraiser and Client in writing. WHEN APPRAISERS OBLIGATIONS ARE COMPLETE Appraisers obligations pursuant to this Agreement are complete when the Appraisal Report in the form specified in this Agreement is delivered to Client pursuant to this Agreement. Appraiser agrees to be responsive to Clients legitimate inquiries regarding the contents of the report after delivery. USE OF EMPLOYEES OR INDEPENDENT CONTRACTORS Appraiser may use employees or independent contractors at Appraisers discretion to complete the assignment, unless otherwise agreed by the parties. Notwithstanding, Appraiser shall sign the written Appraisal Report and take full responsibility for the services provided as a result of this Agreement. SERVICES NOT PROVIDED The fees set forth in this Agreement apply to the appraisal services rendered by Appraiser as set forth in this Agreement. Unless otherwise specified herein, Appraisers services for which the fees in this Agreement apply shall not include meetings with persons other than Client or Clients


agents or professional advisors; Appraisers deposition(s) or testimony before judicial, arbitration or administrative tribunals; or any preparation associated with such depositions or testimony. Any additional services performed by Appraiser not set forth in this Agreement will be performed on terms and conditions set forth in an amendment to this Agreement, or in a separate agreement. TESTIMONY AT COURT OR OTHER PROCEEDINGS Unless otherwise stated in this Agreement, Client agrees that Appraisers assignment pursuant to this Agreement shall not include Appraisers participation in or preparation for, whether voluntarily or pursuant to subpoena, any oral or written discovery; sworn testimony in a judicial, arbitration or administrative proceeding; or attendance at any judicial, arbitration or administrative proceeding relating to this assignment. GOVERNING LAW AND JURISDICTION This Agreement shall be governed by the law of the state in which Appraisers office as specified in this Agreement is located, exclusive of that states choice of law rules. The parties agree that any legal proceeding brought by either party to interpret or enforce this Agreement, or to enforce an arbitration award entered pursuant to this Agreement, shall be brought in a state or federal court having jurisdiction over the location of Appraisers office as specified in this Agreement, and the parties hereby waive any objections to the personal jurisdiction of said court. APPRAISER INDEPENDENCE Appraiser cannot agree to provide a value opinion that is contingent on a predetermined amount. Appraiser cannot guarantee the outcome of the assignment in advance. Appraiser cannot ensure that the opinion of value developed as a result of this Assignment will serve to facilitate any specific objective of Client or others or advance any particular cause. Appraisers opinion of value will be developed competently and with independence, impartiality and objectivity. NOTICES Any notice or request required or permitted to be given to any party shall be given in writing and shall be delivered to the receiving party by: a) registered or certified mail, postage prepaid; (b) overnight courier, such as Federal Express, United Parcel Service or equivalent; or (c) hand delivery. The address for delivery of any notice shall be the address for the party as specified in this Agreement, or at such other address as party may designate by written notice to the other party in conformance with this paragraph. Unless otherwise specified herein, notice shall be effective the date it is postmarked or given to a third party for delivery to the receiving party, whether or not the receiving party signs for or accepts delivery of such notice. NO THIRD-PARTY BENEFICIARIES Nothing in this Agreement shall create a contractual relationship between Appraiser or Client and any third party, or any cause of action in favor of any third party. This Agreement shall not be construed to render any person or entity a third party beneficiary of this Agreement, including, but not limited to, any third parties identified herein.


MEDIATION & ARBITRATION In the event of a dispute concerning the subject matter of this Agreement, the parties shall in good faith attempt to resolve such dispute by negotiation between the parties principals, or, if such negotiation is unsuccessful, by mediation conducted by a third-party mediator. If such mediation results in an impasse, the parties shall submit their dispute to binding arbitration. Such mediation or, if necessary, binding arbitration shall be conducted pursuant to the mediation procedures or the commercial arbitration rules of the American Arbitration Association. Any arbitration shall be conducted in the city in which Appraisers office as specified herein is located. The parties shall share equally the costs of any mediation. In the event of binding arbitration, the arbitrators shall, in addition to any relief appropriate to be awarded to the prevailing party, enter an award in favor of the prevailing party for that partys costs of the arbitration, including the partys reasonable attorneys fees and arbitration expenses incurred in prosecuting or defending the arbitration proceeding. Subject to the right of the prevailing party to recover its share of the costs of the arbitration services pursuant to the arbitrators award, the costs of the arbitration services shall be borne equally by the parties. If the prevailing party seeks judicial confirmation of any arbitration award entered pursuant to this Agreement, the court shall, in addition to any other appropriate relief, enter an award to the prevailing party in such confirmation proceeding for its reasonable attorneys fees and litigation expenses incurred in confirming or successfully opposing the confirmation of such an award. SPECIAL OR CONSEQUENTIAL DAMAGES Neither party shall under any circumstances be liable to the other party for special, exemplary, punitive or consequential damages, including, without limitation, loss of profits or damages proximately caused by loss of use of any property, whether arising from either partys negligence, breach of the Agreement or otherwise, whether or not a party was advised, or knew, of the possibility of such damages, or such possibility was foreseeable by that party. In no event shall Appraiser be liable to Client for any amounts that exceed the fees and costs paid by Client to Appraiser pursuant to this Agreement. ASSIGNMENT Neither party may assign this Agreement to a third party without the express written consent of the other party, which the non-assigning party may withhold in its sole discretion. In the event this Agreement is assigned by mutual consent of the parties, it shall become binding on the assigning partys permitted assigns. SEVERABILITY In the event any provision of this Agreement shall be determined to be void or unenforceable by any court of competent jurisdiction, then such determination shall not affect any other provision of this Agreement and all such other provisions shall remain in full force and effect. CLIENTS DUTY TO INDEMNIFY APPRAISER Client shall have the right to settle any Claim, provided that Appraiser shall have the right to approve any settlement that results in any modification of Appraisers rights under this Agreement, which approval will not be unreasonably withheld, delayed or conditioned.


CLIENTS REPRESENTATIONS AND WARRANTIES Client represents and warrants to Appraiser that (1) Client has all right, power and authority to enter into this Agreement; (2) Clients duties and obligations under this Agreement do not conflict with any other duties or obligations assumed by Client under any agreement between Client and any other party; and (3) Client has not engaged Appraiser, nor will Client use Appraisers Appraisal Report, for any purposes that violate any federal, state or local law, regulation or ordinance or common law. EXTENT OF AGREEMENT This Agreement represents the entire and integrated agreement between the Client and Appraiser and supersedes all prior negotiations, representations or agreements, either written or oral. This Agreement may be amended only by a written instrument signed by both Client and Appraiser. This Agreement includes the following Appendices, which are incorporated into, and made a part of this Agreement:

N/A - TBD EXPIRATION OF AGREEMENT This Agreement is valid only if signed by both Appraiser and Client within 7 days of the Date of Agreement specified. By Appraiser: By Client: ________________________________ _______________________ (Signature) (Signature) ________________________________ _______________________ (Printed name) (Printed name) ________________________________ _______________________ (date) (date)

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2nd 2015 NM Spaceport Appraisal

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