Real Estate Investment Analysis

2 Story Class B Office Building9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 91730

Report Prepared By

Coldwell Banker Commercial Jeff Kane, DRE 01915649; Bridgette Young DRE 01847648760-518-4900 Kane Direct

760-443-5300 Young DirectJeffKaneRE@gmail.com

Bridgette.young@camoves.com

Real Estate Investment Analysis

2 Story Class B Office Building9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 91730

Report Prepared By

Coldwell Banker Commercial Jeff Kane, DRE 01915649; Bridgette Young DRE 01847648760-518-4900 Kane Direct

760-443-5300 Young DirectJeffKaneRE@gmail.com

Bridgette.young@camoves.com

Jeff KaneREALTOR®

(760) 518-4900JeffKaneRE@gmail.comCalRE# 01915649

Bridgette YoungREALTOR®

(760) 443-5300Bridgette.Young@camoves.comCalRE# 01847648

Real Estate Investment Analysis

2 Story Class B Office Building9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 91730

Report Prepared By

Coldwell Banker Commercial Jeff Kane, DRE 01915649; Bridgette Young DRE 01847648760-518-4900 Kane Direct

760-443-5300 Young DirectJeffKaneRE@gmail.com

Bridgette.young@camoves.com

Property Summary Year 1

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Operating Statement Gross Scheduled Income $238,396- Vacancy Loss $11,916= Gross Effective Income $226,480+ Other Income $0= Gross Operating Income $226,480- Total Operating Expenses $67,992= Net Operating Income (NOI) $158,488

Financial Statistics Occupancy Percent 95.0%Vacancy Percent 5.0%Monthly Income Per Unit $19,866Monthly Income Per Sq Ft $2Annual Expenses Per Unit $67,992Annual Expenses per Sq Ft $7Gross Rent Multiplier 11.95Cap Rate 5.56%

Property Data Purchase Price $2,849,450Number of Units 1Number Occupied 1Number VacantPrice Per Unit $2,849,450Rentable Sq Ft 9,113Price Per Sq Ft $313Taxes $16,980Insurance $8,280

Year Built 2008Land Area .11 acreBuildings 1Stories 2Electric MetersGas MetersParking Spaces 35Roof Flat

CommercialZoning C1

Amenities and Features

PROPERTY FEATURES

• Excellent Owner/User Opportunity• Approximately 9,113 Square Feet• Located near one of the most desirable freeway intersections• Great access to I-10 and I-15• Highly Upgraded Improvements• Built-out Offices Available for Immediate Occupancy• Elevator Serviced• Parking 4:1000• Possible Building Signage• 10% Down SBA Loan Possible• Within minutes to Ontario Intl’ Airport

LOCATION

• Less than a mile from: LA-Ontario International Airport, Ontario Mills Mall, Convention Center, and the Citizens Business Bank Area. • Numerous Other Restaurants, Retail, Business Services and Hotel Amenities Nearby.

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Property Details, Year 1

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Future Value Escalator Year 1 Year 2 Year 3 Year 4 Appreciation 4.00% 4.00% 4.00% 4.00%

Vacancy Percent -- C:Calculate or U:Use data until next month Description Month 1 Vacant 5.0% U

Other Income -- Future years use year 5 data with a % annual escalator Year 1 Year 2 Year 3 Year 4 Year 5 Laundry

Income Escalators Gross Scheduled Income 4.00% Other Income

Expenses: Utilities -- Future years use year 5 data with a 2.00% annual escalator Year 1 Year 2 Year 3 Year 4 Year 5 Water $2,676.00 $2,729.52 $2,784.11 $2,839.79 $2,896.59 Electric $16,980.00 $17,319.60 $17,665.99 $18,019.31 $18,379.70 Insurance

Expenses: Services -- Future years use year 5 data with a 2.00% annual escalator Year 1 Year 2 Year 3 Year 4 Year 5 HOA Fees $4,740.00 $4,834.80 $4,931.50 $5,030.13 $5,130.73 Security $2,160.00 $2,203.20 $2,247.26 $2,292.21 $2,338.05 Elevator $2,448.00 $2,496.96 $2,546.90 $2,597.84 $2,649.79

Expenses: Other -- Future years use year 5 data with a 2.00% annual escalator Year 1 Year 2 Year 3 Year 4 Year 5

Expense Escalators Expenses 2.00%

Cost Recovery Period Improvements Years 27.5 Personal Property Years 5.0

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Property Details, Year 1

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Other Assumptions Tax Bracket 28.00% Cost to Sell Property 5.00% NPV Discount Rate 10.00%

Investment Comparisons Bank CD Rate 1.00% Mutual Fund 2.20%

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Amortization Schedule

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

1st MTG - Fxd, Fully Amortized

Loan Amount $2,222,571Loan to Value (LTV) 78.00%Amortization Period 30.0 YearsTerm (Due Date) 30.0 Years

Points 1.0%Interest Rate 4.500%

Monthly Amortization Table with Yearly Total Paid and Loan BalanceYear Payment Principal Interest Total Paid Loan Balance 1 $11,261 $2,988 $8,274 $135,132 $2,186,721 2 $11,261 $3,125 $8,136 $270,264 $2,149,225 3 $11,261 $3,268 $7,993 $405,396 $2,110,005 4 $11,261 $3,418 $7,843 $540,528 $2,068,984 5 $11,261 $3,575 $7,686 $675,660 $2,026,079 6 $11,261 $3,740 $7,521 $810,792 $1,981,203 7 $11,261 $3,912 $7,349 $945,924 $1,934,264 8 $11,261 $4,091 $7,170 $1,081,056 $1,885,170 9 $11,261 $4,279 $6,982 $1,216,188 $1,833,820 10 $11,261 $4,476 $6,785 $1,351,320 $1,780,111 11 $11,261 $4,681 $6,580 $1,486,452 $1,723,935 12 $11,261 $4,896 $6,365 $1,621,584 $1,665,178 13 $11,261 $5,121 $6,140 $1,756,716 $1,603,722 14 $11,261 $5,357 $5,904 $1,891,848 $1,539,442 15 $11,261 $5,603 $5,658 $2,026,980 $1,472,210 16 $11,261 $5,860 $5,401 $2,162,112 $1,401,889 17 $11,261 $6,129 $5,132 $2,297,244 $1,328,337 18 $11,261 $6,411 $4,850 $2,432,376 $1,251,406 19 $11,261 $6,705 $4,556 $2,567,508 $1,170,941 20 $11,261 $7,013 $4,248 $2,702,640 $1,086,780 21 $11,261 $7,336 $3,925 $2,837,772 $998,752 22 $11,261 $7,673 $3,588 $2,972,904 $906,680 23 $11,261 $8,025 $3,236 $3,108,036 $810,379 24 $11,261 $8,394 $2,867 $3,243,168 $709,653 25 $11,261 $8,779 $2,482 $3,378,300 $604,300 26 $11,261 $9,183 $2,078 $3,513,432 $494,108 27 $11,261 $9,605 $1,656 $3,648,564 $378,853 28 $11,261 $10,046 $1,215 $3,783,696 $258,303 29 $11,261 $10,507 $754 $3,918,828 $132,215 30 $11,289 $11,018 $271 $4,054,295 $0

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Rent Roll at Month 1

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Rent Roll Summary Possible Rent $19,866- Vacancy Rent $11,916= Occupied Rent $226,480

Total Units 1Vacant 5.0%Occupied 95.0%

Row Tenant SqFt Rent/SqFt CAMS Rent Income0 Various 9,113 $2.18 $0 $19,866 $19,866

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 1

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (EOY 1) $2,963,426

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $238,396- Vacancy $11,916= Effective Rental Income $226,480= Annual Gross Operating Income $226,480= Monthly Gross Operating Income $18,873

ExpensesTaxes $16,980+ Insurance $8,280+ Property Management $11,328+ Maintenance & Repair $2,400+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $67,992= Monthly Operating Expenses $5,666

Net Operating IncomeAnnual Gross Operating Income $226,480- Annual Operating Expenses $67,992

Net Operating Income Cont.= Annual Net Operating Income $158,488= Monthly Net Operating Income $13,207

Cash FlowNet Operating Income $158,488- Annual Debt Service $135,132= Annual Cash Flow Before Tax $23,356= Monthly Cash Flow Before Tax $1,946- Tax Liability (Savings) @ 28 % $16,378= Annual Cash Flow After Tax $6,978= Monthly Cash Flow After Tax $581

Common IndicatorsCap Rate 5.56%Gross Rent Multiplier 11.95Cash on Cash 2.95%Debt Coverage Ratio 1.17Modified DCR 1.17Default Ratio (Break Even) 89.69

Return on Accumulated InvestmentAccumulated Investment $790,722 Return %Cash Flow Before Tax $23,356 2.95%+ Appreciation @ 4.0% $113,976 14.41%+ Principal Reduction $35,850 4.53%- Tax Liability @ 28.00% $16,378 2.07%= Total Return $156,804 19.83%

Proceeds from SaleEnd of Year Property Value $2,963,426Gross Equity Before Tax $776,705- 5.00 % Cost of Sale $148,171= Proceeds from Sale Before Tax $628,534

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 2

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 2) $2,963,426Appreciated Price (EOY 2) $3,081,962

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $247,932- Vacancy $12,396= Effective Rental Income $235,536= Annual Gross Operating Income $235,536= Monthly Gross Operating Income $19,628

ExpensesTaxes $17,320+ Insurance $8,446+ Property Management $11,772+ Maintenance & Repair $2,448+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $69,569= Monthly Operating Expenses $5,797

Net Operating IncomeAnnual Gross Operating Income $235,536

Net Operating Income Cont.- Annual Operating Expenses $69,569= Annual Net Operating Income $165,967= Monthly Net Operating Income $13,831

Cash FlowNet Operating Income $165,967- Annual Debt Service $135,132= Annual Cash Flow Before Tax $30,835= Monthly Cash Flow Before Tax $2,570- Tax Liability (Savings) @ 28 % $18,933= Annual Cash Flow After Tax $11,902= Monthly Cash Flow After Tax $992

Common IndicatorsCap Rate 5.60%Gross Rent Multiplier 11.95Cash on Cash 3.90%Debt Coverage Ratio 1.23Modified DCR 1.23Default Ratio (Break Even) 86.91IRR Before Tax (17.56%)IRR After Tax (15.67%)

Return on Accumulated InvestmentAccumulated Investment $946,374 Return %Cash Flow Before Tax $30,835 3.26%+ Appreciation @ 4.0% $118,156 12.49%+ Principal Reduction $37,496 3.96%- Tax Liability @ 28.00% $18,933 2.00%= Total Return $167,554 17.70%

Proceeds from SaleEnd of Year Property Value $3,081,962Gross Equity Before Tax $932,357- 5.00 % Cost of Sale $154,098= Proceeds from Sale Before Tax $778,259

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 3

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 3) $3,081,962Appreciated Price (EOY 3) $3,205,238

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $257,849- Vacancy $12,888= Effective Rental Income $244,961= Annual Gross Operating Income $244,961= Monthly Gross Operating Income $20,413

ExpensesTaxes $17,666+ Insurance $8,615+ Property Management $12,252+ Maintenance & Repair $2,497+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $71,205= Monthly Operating Expenses $5,934

Net Operating IncomeAnnual Gross Operating Income $244,961

Net Operating Income Cont.- Annual Operating Expenses $71,205= Annual Net Operating Income $173,756= Monthly Net Operating Income $14,480

Cash FlowNet Operating Income $173,756- Annual Debt Service $135,132= Annual Cash Flow Before Tax $38,624= Monthly Cash Flow Before Tax $3,219- Tax Liability (Savings) @ 28 % $21,597= Annual Cash Flow After Tax $17,027= Monthly Cash Flow After Tax $1,419

Common IndicatorsCap Rate 5.64%Gross Rent Multiplier 11.95Cash on Cash 4.88%Debt Coverage Ratio 1.29Modified DCR 1.29Default Ratio (Break Even) 84.23IRR Before Tax 2.64%IRR After Tax 0.38%

Return on Accumulated InvestmentAccumulated Investment $1,108,475 Return %Cash Flow Before Tax $38,624 3.48%+ Appreciation @ 4.0% $122,881 11.09%+ Principal Reduction $39,220 3.54%- Tax Liability @ 28.00% $21,597 1.95%= Total Return $179,128 16.16%

Proceeds from SaleEnd of Year Property Value $3,205,238Gross Equity Before Tax $1,094,458- 5.00 % Cost of Sale $160,262= Proceeds from Sale Before Tax $934,196

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 4

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 4) $3,205,238Appreciated Price (EOY 4) $3,333,446

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $268,163- Vacancy $13,404= Effective Rental Income $254,759= Annual Gross Operating Income $254,759= Monthly Gross Operating Income $21,230

ExpensesTaxes $18,019+ Insurance $8,787+ Property Management $12,732+ Maintenance & Repair $2,547+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $72,864= Monthly Operating Expenses $6,072

Net Operating IncomeAnnual Gross Operating Income $254,759

Net Operating Income Cont.- Annual Operating Expenses $72,864= Annual Net Operating Income $181,895= Monthly Net Operating Income $15,158

Cash FlowNet Operating Income $181,895- Annual Debt Service $135,132= Annual Cash Flow Before Tax $46,763= Monthly Cash Flow Before Tax $3,897- Tax Liability (Savings) @ 28 % $24,380= Annual Cash Flow After Tax $22,383= Monthly Cash Flow After Tax $1,865

Common IndicatorsCap Rate 5.67%Gross Rent Multiplier 11.95Cash on Cash 5.91%Debt Coverage Ratio 1.35Modified DCR 1.35Default Ratio (Break Even) 81.64IRR Before Tax 9.37%IRR After Tax 5.79%

Return on Accumulated InvestmentAccumulated Investment $1,277,293 Return %Cash Flow Before Tax $46,763 3.66%+ Appreciation @ 4.0% $127,797 10.01%+ Principal Reduction $41,021 3.21%- Tax Liability @ 28.00% $24,380 1.91%= Total Return $191,201 14.97%

Proceeds from SaleEnd of Year Property Value $3,333,446Gross Equity Before Tax $1,263,276- 5.00 % Cost of Sale $166,672= Proceeds from Sale Before Tax $1,096,604

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 5

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 5) $3,333,446Appreciated Price (EOY 5) $3,466,790

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $278,890- Vacancy $13,944= Effective Rental Income $264,946= Annual Gross Operating Income $264,946= Monthly Gross Operating Income $22,079

ExpensesTaxes $18,380+ Insurance $8,963+ Property Management $13,248+ Maintenance & Repair $2,598+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $74,583= Monthly Operating Expenses $6,215

Net Operating IncomeAnnual Gross Operating Income $264,946

Net Operating Income Cont.- Annual Operating Expenses $74,583= Annual Net Operating Income $190,363= Monthly Net Operating Income $15,864

Cash FlowNet Operating Income $190,363- Annual Debt Service $135,132= Annual Cash Flow Before Tax $55,231= Monthly Cash Flow Before Tax $4,603- Tax Liability (Savings) @ 28 % $27,279= Annual Cash Flow After Tax $27,952= Monthly Cash Flow After Tax $2,329

Common IndicatorsCap Rate 5.71%Gross Rent Multiplier 11.95Cash on Cash 6.98%Debt Coverage Ratio 1.41Modified DCR 1.41Default Ratio (Break Even) 79.15IRR Before Tax 12.33%IRR After Tax 8.32%

Return on Accumulated InvestmentAccumulated Investment $1,453,114 Return %Cash Flow Before Tax $55,231 3.80%+ Appreciation @ 4.0% $132,916 9.15%+ Principal Reduction $42,905 2.95%- Tax Liability @ 28.00% $27,279 1.88%= Total Return $203,773 14.02%

Proceeds from SaleEnd of Year Property Value $3,466,790Gross Equity Before Tax $1,439,097- 5.00 % Cost of Sale $173,340= Proceeds from Sale Before Tax $1,265,757

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 6

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 6) $3,466,790Appreciated Price (EOY 6) $3,605,462

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $290,046- Vacancy $14,508= Effective Rental Income $275,538= Annual Gross Operating Income $275,538= Monthly Gross Operating Income $22,962

ExpensesTaxes $18,747+ Insurance $9,142+ Property Management $13,776+ Maintenance & Repair $2,650+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $76,338= Monthly Operating Expenses $6,361

Net Operating IncomeAnnual Gross Operating Income $275,538

Net Operating Income Cont.- Annual Operating Expenses $76,338= Annual Net Operating Income $199,200= Monthly Net Operating Income $16,600

Cash FlowNet Operating Income $199,200- Annual Debt Service $135,132= Annual Cash Flow Before Tax $64,068= Monthly Cash Flow Before Tax $5,339- Tax Liability (Savings) @ 28 % $30,305= Annual Cash Flow After Tax $33,763= Monthly Cash Flow After Tax $2,814

Common IndicatorsCap Rate 5.75%Gross Rent Multiplier 11.95Cash on Cash 8.10%Debt Coverage Ratio 1.47Modified DCR 1.47Default Ratio (Break Even) 76.75IRR Before Tax 13.79%IRR After Tax 9.68%

Return on Accumulated InvestmentAccumulated Investment $1,636,218 Return %Cash Flow Before Tax $64,068 3.92%+ Appreciation @ 4.0% $138,228 8.45%+ Principal Reduction $44,876 2.74%- Tax Liability @ 28.00% $30,305 1.85%= Total Return $216,867 13.25%

Proceeds from SaleEnd of Year Property Value $3,605,462Gross Equity Before Tax $1,622,201- 5.00 % Cost of Sale $180,273= Proceeds from Sale Before Tax $1,441,928

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 7

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 7) $3,605,462Appreciated Price (EOY 7) $3,749,678

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $301,648- Vacancy $15,084= Effective Rental Income $286,564= Annual Gross Operating Income $286,564= Monthly Gross Operating Income $23,880

ExpensesTaxes $19,122+ Insurance $9,325+ Property Management $14,328+ Maintenance & Repair $2,703+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $78,141= Monthly Operating Expenses $6,512

Net Operating IncomeAnnual Gross Operating Income $286,564

Net Operating Income Cont.- Annual Operating Expenses $78,141= Annual Net Operating Income $208,423= Monthly Net Operating Income $17,369

Cash FlowNet Operating Income $208,423- Annual Debt Service $135,132= Annual Cash Flow Before Tax $73,291= Monthly Cash Flow Before Tax $6,108- Tax Liability (Savings) @ 28 % $33,465= Annual Cash Flow After Tax $39,826= Monthly Cash Flow After Tax $3,319

Common IndicatorsCap Rate 5.78%Gross Rent Multiplier 11.95Cash on Cash 9.27%Debt Coverage Ratio 1.54Modified DCR 1.54Default Ratio (Break Even) 74.42IRR Before Tax 14.57%IRR After Tax 10.47%

Return on Accumulated InvestmentAccumulated Investment $1,826,911 Return %Cash Flow Before Tax $73,291 4.01%+ Appreciation @ 4.0% $143,754 7.87%+ Principal Reduction $46,939 2.57%- Tax Liability @ 28.00% $33,465 1.83%= Total Return $230,519 12.62%

Proceeds from SaleEnd of Year Property Value $3,749,678Gross Equity Before Tax $1,812,894- 5.00 % Cost of Sale $187,484= Proceeds from Sale Before Tax $1,625,410

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 8

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 8) $3,749,678Appreciated Price (EOY 8) $3,899,666

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $313,714- Vacancy $15,684= Effective Rental Income $298,030= Annual Gross Operating Income $298,030= Monthly Gross Operating Income $24,836

ExpensesTaxes $19,505+ Insurance $9,511+ Property Management $14,904+ Maintenance & Repair $2,757+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $79,993= Monthly Operating Expenses $6,666

Net Operating IncomeAnnual Gross Operating Income $298,030

Net Operating Income Cont.- Annual Operating Expenses $79,993= Annual Net Operating Income $218,037= Monthly Net Operating Income $18,170

Cash FlowNet Operating Income $218,037- Annual Debt Service $135,132= Annual Cash Flow Before Tax $82,905= Monthly Cash Flow Before Tax $6,909- Tax Liability (Savings) @ 28 % $36,760= Annual Cash Flow After Tax $46,145= Monthly Cash Flow After Tax $3,845

Common IndicatorsCap Rate 5.81%Gross Rent Multiplier 11.95Cash on Cash 10.48%Debt Coverage Ratio 1.61Modified DCR 1.61Default Ratio (Break Even) 72.18IRR Before Tax 14.97%IRR After Tax 10.95%

Return on Accumulated InvestmentAccumulated Investment $2,025,512 Return %Cash Flow Before Tax $82,905 4.09%+ Appreciation @ 4.0% $149,507 7.38%+ Principal Reduction $49,094 2.42%- Tax Liability @ 28.00% $36,760 1.81%= Total Return $244,746 12.08%

Proceeds from SaleEnd of Year Property Value $3,899,666Gross Equity Before Tax $2,011,495- 5.00 % Cost of Sale $194,983= Proceeds from Sale Before Tax $1,816,512

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 9

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 9) $3,899,666Appreciated Price (EOY 9) $4,055,654

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $326,263- Vacancy $16,308= Effective Rental Income $309,955= Annual Gross Operating Income $309,955= Monthly Gross Operating Income $25,830

ExpensesTaxes $19,895+ Insurance $9,701+ Property Management $15,492+ Maintenance & Repair $2,812+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $81,883= Monthly Operating Expenses $6,824

Net Operating IncomeAnnual Gross Operating Income $309,955

Net Operating Income Cont.- Annual Operating Expenses $81,883= Annual Net Operating Income $228,072= Monthly Net Operating Income $19,006

Cash FlowNet Operating Income $228,072- Annual Debt Service $135,132= Annual Cash Flow Before Tax $92,940= Monthly Cash Flow Before Tax $7,745- Tax Liability (Savings) @ 28 % $40,202= Annual Cash Flow After Tax $52,738= Monthly Cash Flow After Tax $4,395

Common IndicatorsCap Rate 5.85%Gross Rent Multiplier 11.95Cash on Cash 11.75%Debt Coverage Ratio 1.69Modified DCR 1.69Default Ratio (Break Even) 70.01IRR Before Tax 15.18%IRR After Tax 11.25%

Return on Accumulated InvestmentAccumulated Investment $2,232,350 Return %Cash Flow Before Tax $92,940 4.16%+ Appreciation @ 4.0% $155,488 6.97%+ Principal Reduction $51,350 2.30%- Tax Liability @ 28.00% $40,202 1.80%= Total Return $259,576 11.63%

Proceeds from SaleEnd of Year Property Value $4,055,654Gross Equity Before Tax $2,218,333- 5.00 % Cost of Sale $202,783= Proceeds from Sale Before Tax $2,015,550

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Annual Property Report, Year 10

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

PricePurchase Price $2,849,450Appreciated Price (BOY 10) $4,055,654Appreciated Price (EOY 10) $4,217,882

Initial InvestmentDown Payment $712,362+ Closing Costs $56,989+ Loan Points $21,371= Initial Investment $790,722

FinancingMortgage $2,222,571Points 1.0Interest Rate 4.500%Amortized Over 30.0 yearsTerm (Due Date) 30.0 yearsAnnual Payment $135,132Monthly Payment $11,261

IncomeGross Scheduled Income $339,314- Vacancy $16,968= Effective Rental Income $322,346= Annual Gross Operating Income $322,346= Monthly Gross Operating Income $26,862

ExpensesTaxes $20,293+ Insurance $9,895+ Property Management $16,116+ Maintenance & Repair $2,868+ Water $2,676+ Electric $16,980+ HOA Fees $4,740+ Security $2,160+ Elevator $2,448= Annual Operating Expenses $83,835= Monthly Operating Expenses $6,986

Net Operating IncomeAnnual Gross Operating Income $322,346

Net Operating Income Cont.- Annual Operating Expenses $83,835= Annual Net Operating Income $238,511= Monthly Net Operating Income $19,876

Cash FlowNet Operating Income $238,511- Annual Debt Service $135,132= Annual Cash Flow Before Tax $103,379= Monthly Cash Flow Before Tax $8,615- Tax Liability (Savings) @ 28 % $43,785= Annual Cash Flow After Tax $59,594= Monthly Cash Flow After Tax $4,966

Common IndicatorsCap Rate 5.88%Gross Rent Multiplier 11.95Cash on Cash 13.07%Debt Coverage Ratio 1.77Modified DCR 1.77Default Ratio (Break Even) 67.93IRR Before Tax 15.26%IRR After Tax 11.44%

Return on Accumulated InvestmentAccumulated Investment $2,447,767 Return %Cash Flow Before Tax $103,379 4.22%+ Appreciation @ 4.0% $161,708 6.61%+ Principal Reduction $53,709 2.19%- Tax Liability @ 28.00% $43,785 1.79%= Total Return $275,011 11.24%

Proceeds from SaleEnd of Year Property Value $4,217,882Gross Equity Before Tax $2,433,750- 5.00 % Cost of Sale $210,894= Proceeds from Sale Before Tax $2,222,856

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Financing Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

PRICEPurchase Price $2,849,450 $2,849,450 $2,849,450 $2,849,450 $2,849,450Escalated Price (BOY) $2,849,450 $2,963,426 $3,081,962 $3,205,238 $3,333,446Escalated Price (EOY) $2,963,426 $3,081,962 $3,205,238 $3,333,446 $3,466,790Price Escalator: Appreciation 4.00 % 4.00 % 4.00 % 4.00 % 4.00 %

INITIAL INVESTMENTDown Payment $712,362 $712,362 $712,362 $712,362 $712,362+ Closing Costs + $56,989 + $56,989 + $56,989 + $56,989 + $56,989+ Other Costs + $0 + $0 + $0 + $0 + $0+ Rehab Costs + $0 + $0 + $0 + $0 + $0= Total Investment = $790,722 = $790,722 = $790,722 = $790,722 = $790,722

1st MTG - Fxd, Fully AmortizedLoan Amount $2,222,571 $2,222,571 $2,222,571 $2,222,571 $2,222,571Loan to Value (LTV) 78.00 % 78.00 % 78.00 % 78.00 % 78.00 %Interest Rate 4.500 % 4.500 % 4.500 % 4.500 % 4.500 %Amortization Period 30.0 Yrs 30.0 Yrs 30.0 Yrs 30.0 Yrs 30.0 YrsTerm (Due Date) 30.0 Yrs 30.0 Yrs 30.0 Yrs 30.0 Yrs 30.0 YrsPoints 1.0 % 1.0 % 1.0 % 1.0 % 1.0 %

Annual Principal $35,850 $37,496 $39,220 $41,021 $42,905+ Annual Interest + $99,282 + $97,636 + $95,912 + $94,111 + $92,227= Annual Debt Service = $135,132 = $135,132 = $135,132 = $135,132 = $135,132

Loan Balance (BOY) $2,222,571 $2,186,721 $2,149,225 $2,110,005 $2,068,984- Annual Principal + $35,850 + $37,496 + $39,220 + $41,021 + $42,905= Loan Balance (EOY) = $2,186,721 = $2,149,225 = $2,110,005 = $2,068,984 = $2,026,079

PRINCIPAL TRACKING1st Mortgage Loan Amount $2,222,571 $2,222,571 $2,222,571 $2,222,571 $2,222,571- 1st Mortgage Loan Balance (EOY) + $2,186,721 + $2,149,225 + $2,110,005 + $2,068,984 + $2,026,079= Principal Paid (Interest Deferred) = $35,850 = $73,346 = $112,566 = $153,587 = $196,492

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Before-Tax Cash Flow Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

ANNUAL INCOMEGross Scheduled Income $238,396 $247,932 $257,849 $268,163 $278,890- Vacancy + $11,916 + $12,396 + $12,888 + $13,404 + $13,944= Effective Rental Income = $226,480 = $235,536 = $244,961 = $254,759 = $264,946+ Other Income + $0 + $0 + $0 + $0 + $0= Gross Operating Income = $226,480 = $235,536 = $244,961 = $254,759 = $264,946

ANNUAL OPERATING EXPENSESTaxes $16,980 $17,320 $17,666 $18,019 $18,380+ Insurance + $8,280 + $8,446 + $8,615 + $8,787 + $8,963+ Property Management + $11,328 + $11,772 + $12,252 + $12,732 + $13,248+ Maintenance & Repair + $2,400 + $2,448 + $2,497 + $2,547 + $2,598+ Utilities + $19,656 + $20,049 + $20,450 + $20,859 + $21,276+ Services + $9,348 + $9,535 + $9,726 + $9,920 + $10,119+ Other Expenses + $0 + $0 + $0 + $0 + $0= Annual Operating Expenses = $67,992 = $69,569 = $71,205 = $72,864 = $74,583

NET OPERATING INCOMEGross Operating Income $226,480 $235,536 $244,961 $254,759 $264,946- Annual Operating Expenses + $67,992 + $69,569 + $71,205 + $72,864 + $74,583= Net Operating Income = $158,488 = $165,967 = $173,756 = $181,895 = $190,363

ANNUAL DEBT SERVICEPrincipal and Int. 1st Mortgage $135,132 $135,132 $135,132 $135,132 $135,132

ANNUAL CASH FLOW BEFORE TAXNet Operating Income $158,488 $165,967 $173,756 $181,895 $190,363- Annual Debt Service + $135,132 + $135,132 + $135,132 + $135,132 + $135,132- Capital Additions + $0 + $0 + $0 + $0 + $0= Annual Cash Flow Before Tax = $23,356 = $30,835 = $38,624 = $46,763 = $55,231

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

After-Tax Cash Flow Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

ANNUAL CASH FLOW BEFORE TAXGross Scheduled Income $238,396 $247,932 $257,849 $268,163 $278,890- Vacancy + $11,916 + $12,396 + $12,888 + $13,404 + $13,944= Effective Rental Income = $226,480 = $235,536 = $244,961 = $254,759 = $264,946+ Other Income + $0 + $0 + $0 + $0 + $0= Gross Operating Income = $226,480 = $235,536 = $244,961 = $254,759 = $264,946- Annual Operating Expenses + $67,992 + $69,569 + $71,205 + $72,864 + $74,583= Net Operating Income = $158,488 = $165,967 = $173,756 = $181,895 = $190,363- Annual Debt Service + $135,132 + $135,132 + $135,132 + $135,132 + $135,132- Capital Additions + $0 + $0 + $0 + $0 + $0= Annual Cash Flow Before Tax = $23,356 = $30,835 = $38,624 = $46,763 = $55,231

REAL ESTATE TAXABLE INCOMENet Operating Income $158,488 $165,967 $173,756 $181,895 $190,363- Interest 1st Mortgage + $99,282 + $97,636 + $95,912 + $94,111 + $92,227- Points Amortization + $712 + $712 + $712 + $712 + $712- Cost Recovery (Improvements) + $0 + $0 + $0 + $0 + $0- Cost Recovery (Personal) + $0 + $0 + $0 + $0 + $0- Cost Recovery (Cap. Add.) + $0 + $0 + $0 + $0 + $0= R.E. Taxable Income (Loss) = $58,494 = $67,618 = $77,131 = $87,071 = $97,424

PASSIVE LOSS EXEMPTIONPassive Loss Exemption Available $0 $0 $0 $0 $0Passive Losses Allowed $0 $0 $0 $0 $0

ANNUAL SUSPENDED LOSSESR.E. Taxable Income (Loss) $58,494 $67,618 $77,131 $87,071 $97,424Passive Losses Allowed $0 $0 $0 $0 $0Annual Suspended Losses $0 $0 $0 $0 $0

TAX LIABILITY (SAVINGS)R.E. Taxable Income (Min 0) $58,494 $67,618 $77,131 $87,071 $97,424- Suspended Losses Allowed + $0 + $0 + $0 + $0 + $0= Adjusted R.E. Taxable Income = $58,494 = $67,618 = $77,131 = $87,071 = $97,424Tax Liability (Savings) @ 28.00% $16,378 $18,933 $21,597 $24,380 $27,279

ANNUAL CASH FLOW AFTER TAXAnnual Cash Flow Before Tax $23,356 $30,835 $38,624 $46,763 $55,231- Tax Liability (Savings) @ 28 % + $16,378 + $18,933 + $21,597 + $24,380 + $27,279= Cash Flow After Tax = $6,978 = $11,902 = $17,027 = $22,383 = $27,952

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

After-Tax Proceeds from Sale Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

SALES PROCEEDS BEFORE TAXSale Price (EOY) $2,963,426 $3,081,962 $3,205,238 $3,333,446 $3,466,790- Cost of Sale @ 5.00% + $148,171 + $154,098 + $160,262 + $166,672 + $173,340- 1st Mortgage Loan Balance + $2,186,721 + $2,149,225 + $2,110,005 + $2,068,984 + $2,026,079= Sale Proceeds before Tax = $628,534 = $778,639 = $934,971 = $1,097,790 = $1,267,371

BASIS AT ACQUISITIONPurchase Price $2,849,450 $2,849,450 $2,849,450 $2,849,450 $2,849,450+ Capitalized Closing Costs + $56,989 + $56,989 + $56,989 + $56,989 + $56,989+ Rehab Costs + $0 + $0 + $0 + $0 + $0+ Basis Adjustments + $0 + $0 + $0 + $0 + $0= Basis at Acquisition = $2,906,439 = $2,906,439 = $2,906,439 = $2,906,439 = $2,906,439

COST RECOVERY (CR)Annual CR (Improvements) $0 $0 $0 $0 $0+ Annual CR (Personal) + $0 + $0 + $0 + $0 + $0+ Annual CR (Cap. Add.) + $0 + $0 + $0 + $0 + $0= Annual Cost Recovery Taken = $0 = $0 = $0 = $0 = $0

Total Cost Recovery Taken $0 $0 $0 $0 $0

ADJUSTED BASIS AT SALEBasis at Beginning of Year $2,906,439 $2,906,439 $2,906,439 $2,906,439 $2,906,439+ Annual Capital Additions + $0 + $0 + $0 + $0 + $0- Annual Cost Recovery Taken + $0 + $0 + $0 + $0 + $0= Adjusted Basis at Sale = $2,906,439 = $2,906,439 = $2,906,439 = $2,906,439 = $2,906,439

GAIN (LOSS) ON SALESale Price (EOY) $2,963,426 $3,081,962 $3,205,238 $3,333,446 $3,466,790- Cost of Sale @ 5.00% + $148,171 + $154,098 + $160,262 + $166,672 + $173,340- Adjusted Basis at Sale + $2,906,439 + $2,906,439 + $2,906,439 + $2,906,439 + $2,906,439= Total Gain (Loss) = ($91,184) = $21,425 = $138,537 = $260,335 = $387,011- Total Cost Recovery Taken (LTG) + $0 + $0 + $0 + $0 + $0= Capital Gain from Apprec. (Min 0) = $0 = $21,425 = $138,537 = $260,335 = $387,011

TAXED AS ORDINARY INCOMEUnamortized Loan Points ($20,659) ($19,946) ($19,234) ($18,522) ($17,809)+ Suspended Losses (from ATCF) + $0 + $0 + $0 + $0 + $0+ Loss at Disposition - $91,184 + $0 + $0 + $0 + $0= Taxed as Ordinary Income = ($111,843) = ($19,946) = ($19,234) = ($18,522) = ($17,809)

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

After-Tax Proceeds from Sale Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

SALES PROCEEDS AFTER TAXSale Proceeds before Tax $628,534 $778,639 $934,971 $1,097,790 $1,267,371- Tax (Savings) Ord. Inc. @ 28.00% - $31,316 - $5,585 - $5,385 - $5,186 - $4,987- Cost Recovery Recapture @ 25.00% + $0 + $0 + $0 + $0 + $0- Federal Tax on Gain @ 15.00% + $0 + $3,214 + $20,781 + $39,050 + $58,052- State Tax on Gain @ 15.00% + $0 + $3,214 + $20,781 + $39,050 + $58,052= Sale Proceeds after Tax = $659,850 = $777,796 = $898,794 = $1,024,876 = $1,156,254

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Equity Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

SALES PROCEEDS BEFORE TAXSale Price (EOY) $2,963,426 $3,081,962 $3,205,238 $3,333,446 $3,466,790- Cost of Sale @ 5.00% + $148,171 + $154,098 + $160,262 + $166,672 + $173,340- 1st Mortgage Loan Balance + $2,186,721 + $2,149,225 + $2,110,005 + $2,068,984 + $2,026,079= Sale Proceeds before Tax = $628,534 = $778,639 = $934,971 = $1,097,790 = $1,267,371

GROSS EQUITY AT PURCHASEPurchase Price $2,849,450 $2,849,450 $2,849,450 $2,849,450 $2,849,450- Loan Amount + $2,222,571 + $2,222,571 + $2,222,571 + $2,222,571 + $2,222,571= Gross Equity at Purchase = $626,879 = $626,879 = $626,879 = $626,879 = $626,879

GROSS EQUITY (EOY)Gross Equity (BOY) $626,879 $776,705 $932,357 $1,094,458 $1,263,276+ Appreciation Equity + $113,976 + $118,156 + $122,881 + $127,797 + $132,916+ Principal Paydown Equity + $35,850 + $37,496 + $39,220 + $41,021 + $42,905= Gross Equity (EOY) = $776,705 = $932,357 = $1,094,458 = $1,263,276 = $1,439,097

GROSS EQUITY PLUS RESERVESGross Equity (EOY) $776,705 $932,357 $1,094,458 $1,263,276 $1,439,097+ Reserve Balance + $0 + $0 + $0 + $0 + $0= Total Gross Equity = $776,705 = $932,357 = $1,094,458 = $1,263,276 = $1,439,097

RETURN ON GROSS EQUITY (EOY)Annual Cash Flow Before Tax $23,356 $30,835 $38,624 $46,763 $55,231div Gross Equity (EOY) $776,705 $932,357 $1,094,458 $1,263,276 $1,439,097= Return on Gross Equity = 3.01 % = 3.31 % = 3.53 % = 3.70 % = 3.84 %

NET EQUITY (EOY)Gross Equity (EOY) $776,705 $932,357 $1,094,458 $1,263,276 $1,439,097- Cost of Sale @ 5.00% + $148,171 + $154,098 + $160,262 + $166,672 + $173,340= Net Equity (EOY) = $628,534 = $778,259 = $934,196 = $1,096,604 = $1,265,757

INDICATORSCap Rate 5.56 % 5.60 % 5.64 % 5.67 % 5.71 %Gross Rent Multiplier 11.95 11.95 11.95 11.95 11.95Cash on Cash 2.95 % 3.90 % 4.88 % 5.91 % 6.98 %Debt Coverage Ratio 1.17 1.23 1.29 1.35 1.41Modified DCR 1.17 1.23 1.29 1.35 1.41Default Ratio (Break Even) 89.69 % 86.91 % 84.23 % 81.64 % 79.15 %IRR Before Tax (17.56 %) 2.64 % 9.37 % 12.33 % 13.79 %IRR After Tax (15.67 %) 0.38 % 5.79 % 8.32 % 9.68 %NPV After Tax ($184,515) ($131,736) ($86,473) ($46,458) ($11,163)

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Equity Spreadsheet

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

Year Year 1 Year 2 Year 3 Year 4 Year 5

$ RETURN ON INVESTMENTCash Flow Before Tax $23,356 $30,835 $38,624 $46,763 $55,231+ Appreciation + $113,976 + $118,156 + $122,881 + $127,797 + $132,916+ Principal Paydown + $35,850 + $37,496 + $39,220 + $41,021 + $42,905+ Tax Liability/Savings - $16,378 - $18,933 - $21,597 - $24,380 - $27,279= Total Investment Return = $156,804 = $167,554 = $179,128 = $191,201 = $203,773

Initial Investment $790,722 $790,722 $790,722 $790,722 $790,722Return on Cash Flow Before Tax 2.95 % 3.90 % 4.88 % 5.91 % 6.98 %+ Return on Appreciation + 14.41 % + 14.94 % + 15.54 % + 16.16 % + 16.81 %+ Return on Principal Paydown + 4.53 % + 4.74 % + 4.96 % + 5.19 % + 5.43 %+ Return Tax Liability/Savings - 2.07 % - 2.39 % - 2.73 % - 3.08 % - 3.45 %= Return on Initial Investment = 19.83 % = 21.19 % = 22.65 % = 24.18 % = 25.77 %

Accumulated Investment $790,722 $946,374 $1,108,475 $1,277,293 $1,453,114Return on Cash Flow Before Tax 2.95 % 3.26 % 3.48 % 3.66 % 3.80 %+ Return on Appreciation + 14.41 % + 12.49 % + 11.09 % + 10.01 % + 9.15 %+ Return on Principal Paydown + 4.53 % + 3.96 % + 3.54 % + 3.21 % + 2.95 %+ Return Tax Liability/Savings - 2.07 % - 2.00 % - 1.95 % - 1.91 % - 1.88 %= Return on Accumulated Investment = 19.83 % = 17.70 % = 16.16 % = 14.97 % = 14.02 %

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Equity Values Chart

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

This chart shows the Price, Net Equity, and Loan valuesfor the property at 9491 Pittsburgh Ave. Building 1 over a period of 30 years.

The lower chart axis is years.Future assumptions have been factored in.See the spreadsheet for raw data.

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.

Investment Comparison Chart

9491 Pittsburgh Ave. Building 1Rancho Cucamonga CA 917302 Story Class B Office Building

This chart compares the return on a $790,722 investment in the property at 9491 Pittsburgh Ave. Building 1with a Bank CD at 1.0% and a Mutual Fund at 2.2% over a period of 30 years.

The lower chart axis is years.Future assumptions have been factored in.See the spreadsheet for raw data.

Prepared ByJeff Kane, DRE 01915649; Bridgette Young DRE 01847648, 760-518-4900 Kane Direct, 760-443-5300 Young Direct, JeffKaneRE@gmail.com, Bridgette.young@camoves.comColdwell Banker Commercial

This report has been prepared based on information furnished by sources deemed reliable, however no representationor warranty, either express or implied, is made to its accuracy. All dollar values have rounded to the nearest dollar.