ADT Building OM

Historical and Pro Forma NOI

ADT BUILDING | HISTORICAL AND BUDGETED NET OPERATING INCOME & PROJECTED RENEWAL PERIOD RENTAL RATE Square Feet: 171,489

2014 Actual

2015 Actual

2016 Actual

2017 Budget

Pro Forma (1)

Total $ $ PSF Total $ $ PSF Total $ $ PSF Total $ $ PSF Total $ $ PSF

REVENUE

BASE RENT

$3,111,015

$18.14 $0.00 $2.95 $21.09

$3,173,236

$18.50 $0.00 $3.46 $21.97

$3,236,700

$18.87 $0.00 $3.52 $22.40

$3,301,434

$19.25 $0.00 $3.60 $22.86

$3,328,809

$19.41 $0.00 $3.83 $23.24

OTHER INCOME RECOVERIES

$155

$318

$549

$540

$0

(2)

$505,618 $3,616,788

$593,298 $3,766,852

$604,145 $3,841,395

$617,749 $3,919,723

$657,170 $3,985,979

TOTAL REVENUE

EXPENSES REAL ESTATE TAXES

$505,706 $22,642 $57,490 $158,718

$2.95 $0.13 $0.34 $0.93 $0.02 $4.36

$544,154 $23,499 $59,252 $160,743

$3.17 $0.14 $0.35 $0.94 $0.04 $4.63

$580,166 $23,900 $59,513 $135,339

$3.38 $0.14 $0.35 $0.79 $0.02 $4.68

$580,166 $23,979 $58,796 $151,252

$3.38 $0.14 $0.34 $0.88 $0.04 $4.79

$580,000 $77,170 $59,790 $125,000

$3.38 $0.45 $0.35 $0.73 $0.04

INSURANCE

(3) (4) (5)

MANAGEMENT FEE

HVAC

ADMINISTRATIVE

$3,653

$6,564

$3,475

$7,085

$7,085

TOTAL EXPENSES $4.95 Net Operating Income $2,868,579 $16.73 $2,972,640 $17.33 $3,039,002 $17.72 $3,098,445 $18.07 $3,136,935 $18.29 NOTES: (1) Base Rent from period 5/1/17 thru 4/30/18. Expenses based on 2017 Budget, unless otherwise noted. (2) Recoveries for RE Taxes and Insurance. Tenant pays utilities and services directly, but LL responsible for HVAC R&M. (3) Calculated at 1.5% of Effective Gross Revenue. Paid to a related entity to Owner. (4) Assumed reduced HVAC expenses due to scheduled unit replacements in capital budget that will enhance efficiency and reduce repairs. (5) Bank charges were removed from Historical figures as well as Pro Forma analysis. $748,209 $794,212 $802,393 $821,278 $849,045

Contractual Market PROJECTED RENEWAL PERIOD RENTAL RATE (TERM STARTING OCT-2023)

Renewal @ 95% of Market

Projected Growth

Rent Start

Monthly Annual

PSF

Monthly Annual $327,458 $3,929,499 $343,831 $4,125,974 $361,023 $4,332,273 $375,464 $4,505,563 $386,728 $4,640,730 $398,329 $4,779,952

$24.12

10/1/2016 $273,751 $3,285,009

$22.91 $24.06 $25.26 $26.27 $27.06 $27.87 $28.71 $28.71 $29.28 $29.87 $30.47 $31.08

ADT 1501 Yamato Analysis_020717.xls 10/1/2018 $284,810 $3,417,724 $26.59 10/1/2019 $290,507 $3,486,078 $27.66 10/1/2020 $296,317 $3,555,800 $28.49 10/1/2021 $302,243 $3,626,916 $29.34 10/1/2022 $308,288 $3,699,454 $30.22 10/1/2017 $279,226 $3,350,709 $25.33

5.0% 5.0% 4.0% 3.0% 3.0% 3.0% 2.0% 2.0% 2.0% 2.0%

2/23/2017 2:11 PM

$410,279 $4,923,351 < lock-in renewal rate by this year

10/1/2023 10/1/2024 10/1/2025 10/1/2026 10/1/2027

$410,279 $4,923,351

$418,485 $5,021,818 < same terms/steps as lease (2%)

$426,855 $5,122,254 $435,392 $5,224,699 $444,099 $5,329,193

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