CWS Capital Partners has evolved from the company that

was founded in 1969. Its key principals and advisors,

Chief Executive Officer Steve Sherwood, President Gary

Carmell, Chief Investment Officer Mike Engels, and Bill

Williams, have a combined 125 years with the firm. If we had

to title ourselves, it would be “a fully-integrated real estate

investment management company.” We search throughout

America for real estate investment opportunities and

negotiate the purchase and sale of the properties. We

access debt and equity capital to finance both the purchase

and development of those properties. And finally, we

manage them. Throughout each project, we correspond

regularly with our investment partners and coordinate all

the necessary financial reporting and tax return generation.

Importantly, the CWS principals believe in these projects

strongly enough to personally invest in every single one.

Field conditions and competitor behavior

often dictate how a team will prepare a

winning game plan for offense, defense,

and special teams. At CWS Capital

Partners, our team has well-prepared

coaches, all-star athletes, and a winning

tradition to allow for the flexibility,

creativity, and preparation to create

a successful game plan. CWS’s in-depth

analysis of the operating environment

and competit ion, combined with deep

experience operating under all conditions,

allow our team to take the field prepared

to succeed. We invite you to join us on

our continuous journey to competing at

the highest level and producing successful,

sustainable outcomes over the long term.

APARTMENT PORTFOLIO PERFORMANCE SUMMARY F RO M JA N UA RY 1 T O D E C E M BE R 3 1, 2 0 1 4

ACTUAL BUDGE T VARIANCE PERCENT

TOTAL REVENUE $ 309,953,757 $ 308,009,064 $ 1,944,693 0.63%TOTAL OPERATING EXPENSES $ 139,592,305 $ 139,903,957 $ 311,652 0.22%NET OPERATING INCOME/(LOSS) $ 170,361,452 $ 168,105,107 $ 2,256,345 1.34%

1031 EXCHANGE HISTORY

YE ARPRIVATE TIC

EQUIT Y E XCHANGED

COMBINEDEQUIT Y

E XCHANGED

DEFERRED G AIN ASSOCIATED WITH THE EQUIT Y

1985 $ 4,969,908 $ 7,496,092 1986 596,835 618,897 1989 1,238,238 1,871,750 1990 3,591,187 9,283,218 1991 1,267,266 575,893 1992 1,800,396 4,759,007 1993 4,219,577 4,546,184 1995 1,252,827 2,115,161 1996 5,578,435 10,424,092 1997 12,737,361 19,012,046 1998 30,945,816 43,385,626 1999 31,046,933 55,438,498 2000 31,828,056 37,942,895 2002 14,187,460 23,078,845 2003 1,305,981 4,334,016 2004 10,427,349 16,610,408 2006 $ 462,436 12,345,388 14,347,576 2007 2,988,418 36,790,440 50,402,997 2008 537,560 6,713,725 10,402,648 2011 10,912,000 15,001,994 3,586,255 (1)

2012 7,382,742 8,933,358 12,928,368 (1)

2013 13,542,148 36,750,794 27,565,714 (1)

2014 29,141,241 48,796,949 22,886,958 (1)

GRAND TOTAL $ 64,966,545 $ 322,326,273 $ 383,613,144

PROPERTIES REFINANCED IN 2014

PROPERT YMONTH

REFINANCED

MARQUIS AT SUGAR LAND FEBRUARYTHE MARQUIS AT GREAT HILLS AUGUSTMARQUIS AT BELLAIRE RANCH DECEMBERFAIRMONT AT WILLOWCREEK DECEMBERMARQUIS AT CLEAR LAKE DECEMBERREGENTS WEST AT 24TH DECEMBER

PROPERTIES SOLD IN 2014PROPERT Y MONTH SOLD

MARQUIS ROUND ROCK APARTMENTS MARCHTHE MARQUIS AT WILLOW LAKE AUGUSTMARQUIS AT CANYON RIDGE SEPTEMBERTHE MARQUIS AT ROGERS RANCH SEPTEMBER

TRACK RECORD

PROPERT Y LOCATION DATE ACQUIRED SALE DATEINVE STOR RE TURNS

NE T OF FEE SMULTIPLE

NE T OF FEE SASHBURY PARKE AUSTIN, TX JUL-93 JUN-96 22.36% 1.71THE MARQUIS AT LADERA VISTA2 AUSTIN, TX NOV-94 NOV-96 13.54% 1.27BARTON’S LODGE3 AUSTIN, TX DEC-90 MAR-98 20.10% 2.78PLAZA VILLA MONTCLAIR, CA FEB-95 AUG-98 21.91% 1.92THE MARQUIS OF CARMEL VALLEY2 CHARLOTTE, NC JAN-97 MAY-99 28.78% 1.66MARQUIS APARTMENTS AUSTIN, TX NOV-92 JUN-00 18.23% 2.30ARGONNE FOREST AUSTIN, TX DEC-91 AUG-00 19.65% 2.85EDGE CREEK AUSTIN, TX AUG-93 DEC-00 22.88% 2.83O’CONNOR RIDGE DALLAS, TX NOV-95 FEB-02 10.12% 1.70WATERBURY PLACE ARLINGTON, TX JUN-90 MAR-02 8.97% 2.17LAGUNA TERRACE DALLAS, TX JUL-96 APR-03 9.58% 1.57MONTCLAIR PARC CHARLOTTE, NC JUL-97 OCT-04 5.27% 1.37NORTHCREEK APARTMENTS DURHAM, NC JUL-97 OCT-04 9.50% 1.67THE MARQUIS AT CASTLE HILLS SAN ANTONIO, TX JUN-03 MAR-06 28.49% 1.92THE MARQUIS AT WALKER’S BLUFF AUSTIN, TX OCT-98 APR-06 8.15% 1.63THE MARQUIS AT FRANKFORD SPRINGS DALLAS, TX SEP-04 JUN-06 10.30% 1.18SHOAL CREEK BEDFORD, TX NOV-97 JUN-06 9.38% 1.87HUNTINGTON COVE FARMERS BRANCH, TX DEC-89 AUG-06 7.57% 2.57PAPILLON PARC FORT WORTH, TX MAR-89 MAR-07 11.35% 3.62THE MARQUIS AT QUARRY SAN ANTONIO, TX JAN-04 MAR-07 29.44% 2.16THE MARQUIS AT IRON ROCK RANCH AUSTIN, TX DEC-04 APR-07 38.03% 2.11TALAVERA4 SAN ANTONIO, TX APR-98 JUN-07 3.92% 1.34THE MARQUIS AT DTC DENVER, CO SEP-99 JUL-07 9.29% 1.84TOWN LAKE OF COPPELL COPPELL, TX MAR-04 SEP-07 38.11% 2.99THE MARQUIS AT CROSSROADS RALEIGH, NC DEC-00 SEP-08 7.37% 1.59MARQUIS AT LANTANA FLOWER MOUND, TX JUL-06 DEC-08 3.51% 1.09THE MARQUIS ON MCKINNEY DALLAS, TX APR-02 JUN-11 9.63% 2.16PARK AT FOX TRAILS PLANO, TX DEC-06 DEC-11 7.70% 1.43THE MARQUIS AT BARTON CREEK AUSTIN, TX JUL-00 MAY-12 7.41% 2.28BLOCK PHASE I AUSTIN, TX MAR-06 DEC-12 13.37% 2.40BLOCK PHASE II AUSTIN, TX OCT-06 DEC-12 12.14% 1.99MARQUIS AT WEST VILLAGE DALLAS, TX JUN-04 JUL-13 22.41% 3.03MARQUIS AT PARK CENTRAL DALLAS, TX FEB-05 AUG-13 12.22% 2.43WINDSOR AT BARTON CREEK AUSTIN, TX APR-05 SEP-13 13.97% 2.57MARQUIS AT GASTON DALLAS, TX MAY-05 SEP-13 11.70% 2.34MARQUIS AT SILVER OAKS DALLAS, TX SEP-05 SEP-13 15.01% 2.79MARQUIS AT SILVERTON RALEIGH, NC DEC-05 SEP-13 11.15% 2.12PARKWAY TOWERS DENVER, CO DEC-05 SEP-13 6.23% 1.46PARK AT SPRING CREEK DALLAS, TX MAR-06 SEP-13 7.52% 1.68MARQUIS AT BELLAIRE HOUSTON, TX MAY-06 SEP-13 11.47% 2.12MARQUIS AT STONE BRIAR DALLAS, TX JUL-06 SEP-13 8.03% 1.72MARQUIS AT RIVERCHASE DALLAS, TX JUL-06 SEP-13 7.53% 1.66MARQUIS AT EDWARDS MILL RALEIGH, NC JUL-06 SEP-13 9.59% 1.87MARQUIS ON CARY PARKWAY RALEIGH, NC OCT-06 SEP-13 14.22% 2.36MARQUIS AT NORTHCROSS CHARLOTTE, NC DEC-06 SEP-13 5.69% 1.44MARQUIS ON ELDRIDGE HOUSTON, TX MAR-07 SEP-13 15.49% 2.48MARQUIS AT WESTCHASE HOUSTON, TX MAY-07 SEP-13 11.31% 1.95MARQUIS AT PIN OAK HOUSTON, TX MAY-07 SEP-13 12.03% 2.03MARQUIS ON WESTHEIMER HOUSTON, TX JUL-07 SEP-13 14.98% 2.28MARQUIS AT GREAT HILLS AUSTIN, TX SEP-07 SEP-13 5.17% 1.35MARQUIS ON MEMORIAL HOUSTON, TX NOV-07 SEP-13 14.76% 2.13MARQUIS ROUND ROCK APTS ROUND ROCK, TX OCT-11 MAR-14 19.60% 1.51THE MARQUIS AT WILLOW LAKE FORT WORTH, TX AUG-02 AUG-14 15.85% 3.39MARQUIS AT CANYON RIDGE AUSTIN, TX NOV-11 SEP-14 13.08% 1.40THE MARQUIS AT ROGERS RANCH SAN ANTONIO, TX JUL-99 SEP-14 10.24% 3.60PORTFOLIO WEIGHTED AVERAGE 11.87% 1.96PORTFOLIO SIMPLE AVERAGE 13.31% 2.04

(1) Deferred gain from new 1031 exchange investor not included as the investor’s personal gain from non-CWS original properties was not tracked by CWS. (2) These investments were recapitalized after the development was complete. These returns represent the IRRs produced for investors exiting after the development phase. (3) A portion of the investment was set aside for investors completing a 1031 exchange. Because their capital was invested later their IRR is higher than the initial investors. (4) This property investment IRR was calculated with the inclusion of lender group investments and returns. These two lender groups produced IRRs of 18.97% and 8.04% respectively.

This year’s Super Bowl was one for the ages. Two extraordi-narily well-coached teams with tremendous athletes and quar-terbacks fought a gruelling battle to the last second. While it can be a little dangerous to draw precise analogies between sports and business, there are obviously some great lessons to be learned. The basic rules of football and how to win the game have not changed. What has changed dramatically is how teams prepare and execute their game plans to win. What used to be three yards and a cloud of dust, now emphasizes a passing game and a quick moving, efficient offense. Successful football teams have to be well-prepared, flexible, strong, well-conditioned, and rarely off balance. Instincts are highly valuable as well since plays move so quickly and oppor-tunities are so fleeting because of the talent, strength, agility, speed, and organization of the opposing players. When we emerged from the Great Recession we saw that a big hole was opening up, offering a once in a generation investment oppor-tunity. The economy was starting to recover, jobs were forming, households were being created, single-family housing was in distress, the mortgage market was extraordinarily tight, the regulatory environment was putting great pressure on lenders to be very conservative, and very little new construction was taking place. It’s one thing to see the hole opening up and it’s another to be on the field and healthy to hit it hard with great vigor, intensity, and focus. Fortunately at CWS we were in good

THE GAME PLAN

enough shape (bruised a bit but not seriously injured) to be on the field to take advantage of the opportunities. Since 2011 we have purchased 39 properties, broke ground on seven new developments, and refinanced many of our properties. The result has been a significant increase in cash flow and assets that have appreciated in value. We could not have done what we did without adequate preparation and forethought. Just like every football team scouts their oppo-nents and studies film intensely to identify patterns, tenden-cies, and reactions by their opponents, we could not have recognized the opportunity without taking the time to reflect, analyze, discuss, and debate how we could best add value for our investors given the opportunity we could see unfolding. Our instincts told us that this could be one of the great open-ings in our long and illustrious CWS history. It is important that we do not get complacent and think that the same game plan will produce the same favorable results going forward. In the NFL the league is always evolving. Teams innovate and others have to respond if they want to compete. Pete Carroll saw the cornerback position differently than every other coach and determined that the way to neutralize the tall, big, fast receivers was to meet them head on with simi-larly built and skilled cornerbacks. Prior to this, virtually every team manned that position with smaller, much more agile and quicker players. When combined with a punishing pass rush, it had become very difficult for opponents to pass against the Seattle Seahawks. One of Newton’s laws is that for every action

— 5 —

there’s an equal and opposite reaction. Enter Bill Belichick, coach of the New England Patriots, who knew he could not take Seattle’s cornerbacks head on. He devised a game plan of numerous short, timing routes and passes that would allow New England’s smaller receivers to tuck under the less nim-ble cornerbacks while tiring out the pass rush with numerous plays and quick throws. New England eventually prevailed in one of the great Super Bowl games of all time. Markets, values, and competition are always changing. In 2012 we looked at various markets and determined that Atlanta offered us one of the best opportunities to grow given diminished supply, an improving economy, worn out sellers, and a negative perception of the investment opportunity by most investors, thus offering compelling values. Ten acquisi-tions later, Atlanta today is considered the strongest apartment market by investors behind the Bay Area, and we are delight-ed we pursued that game plan aggressively. Yet, everything changes. As Heraclitus said, “You can never step into the same river twice.” The rapids and current keep it changing in perpetuity. Atlanta, while still attractive, requires a bit more discernment than it did two years ago when competition for properties was less and valuations were very attractive. We are four years into the recovery cycle, values are ma-terially higher, and there is more competition. Since supply has been insufficient to meet the strong demand, builders are responding. Single-family is strengthening somewhat as lend-ers begin to loosen the credit reigns a bit. Home values have

gone up resulting in fewer owners with negative equity, and job growth has given prospective buyers more economic horse-power and confidence to invest in a home. Yet, despite the stronger defense we are facing, we are still quite excited about the prospect for apartments and believe we have a well-trained and prepared offense to address the challenges posed by the defenses. The holes we see may be in different cities, narrow-er to go through, and may be different types of opportunities, yet we see opportunities nonetheless. We still have favorable demographics and social and economic trends supporting continued rental demand, low interest rates, higher replace-ment costs due to elevated construction costs, and valuations that can still offer compelling values. Our team has greater depth, strength, and stamina so we are well positioned to endure and compete to produce com-pelling results and investment opportunities. We have made significant investments in our information technology infra-structure, asset management team, training, and risk manage-ment. In addition we have very strong relationships with the industry’s two largest lenders, Fannie Mae and Freddie Mac, which allow us to access some of the most cost competitive fi-nancing in the market. When you add in our top flight acquisi-tions team, investor relations, and human resources, we have all three aspects of the game well covered: offense, defense, and special teams.

Gary Carmell, CFA Partner--President

— 7 —

Earlier this year I had the opportunity to cross an item off my bucket list. I traveled to Green Bay, Wisconsin’s Lambeau Field to watch the Packers and Cowboys play in an NFL playo≠ game. En-tering Lambeau Field all I could think about was the 1967 Ice Bowl when these same teams struggled to a 21 to 17 Packer victory in –2 degree weather. The dramatic changes in the NFL from then to now were very apparent to me as I entered the field and the game unfolded. The focus on passing, the sky cam, new rules, instant replay, and the huge contemporary salaries — how could these teams still be on top in such a di≠erent competitive environment? Then it struck me. It is not that di≠erent from CWS and the dramatically changing apart-ment market. The changes during the last 25 years in the apartment business are quite extensive — the physical design, desire for urban living, leasing by internet, shift away from home ownership, smaller units, walkability, just to name a few. At CWS, we react to changing con-ditions a lot like a successful NFL team. We rely on our skills and the experience of our strong team to come up with the appropriate strategy and then execute that plan with discipline and excellence. Reviewing 43 major apartment markets, we can see they are all experiencing positive rent growth. Some are growing at 7% and others at 1%, but they are all positive. This is because supply has not caught up with demand since the major downturn in 2008. Going forward, it is clear apartments will need to provide a larger portion of the new housing starts since the desire for single family homes for renter-age customers has subsided. The fact that young people are getting married and starting families at a later age combined with their need for flexibility means they are opting to rent longer. They

Flexibility

are drawn to the urban centers and cannot afford to buy in these expensive locations even if they do not have student loans to pay off. They choose to rent smaller units so they can afford the rent and live where they want to live. Given the demographic bulge of the renter-age cohort, we would expect a very healthy demand for apartments during the next five years. Markets will vary in health as supply and demand for each individual market will define how robust it will be. CWS has been excellent at entering markets at opportune times and seeking out the best opportunities. We expect to find opportunities to apply our skills and experience in several areas. The main four are listed:

• Buy existing assets and renovate them• Buy new assets during lease-up at a discount• Develop assets from the ground up• Buy assets with existing non-prepayable debt at a discount

The team at CWS has an excellent track record of knowing when to be aggressive and when to lay back. We are comfortable being outbid four out of five times or even more and only want to buy on terms we feel would make the opportunity an excellent investment. The apartment business has a very bright future and we at CWS will continue to thrive in our ever-changing environment by seeking out the best investments in each new environment. Ten years from now it would not surprise me if the Packers and the Cowboys were still elite NFL football teams. I would also expect CWS to be one of the top performing apartment investors and oper-ators at that time, just as it has been for many years.

Steve SherwoodFounder, Chief Executive Officer & Chairman of the Board

— 9 —

Football coaches always seek a competitive advantage that hopefully provides the winning edge. Similarly, at CWS our strong industry knowledge paired with tax-fa-vored structures combine to provide a winning combi-nation. This season, we are seeing CWS assets continue to produce distributions in an environment characterized by rising taxation coupled with difficulty in finding in-come producing investments. Now more than ever, the tax aspects of investing in real estate are benefitting our investors. One significant way that these tax benefits occur is through depreciation.

Depreciation is an allowance for the decline in value of a long-lived capital asset. In theory, it should equal the cost of replacement when the asset ceases to have value. The IRS currently allows for straight line depre-ciation on a 27.5-year schedule for residential real es-tate investments such as apartments. The buildings and improvements can be depreciated, while the land has no depreciation.

Depreciation deductions provide a powerful tool in deferring taxable income for CWS investors. Below I have outlined two examples of depreciation at work.

Conditioning

Depreciation Example 1 Example 2

Property Value $ 50,000,000 $ 50,000,000 Land Value (15% of asset value) 7,500,000 7,500,000 Building and Improvements Value (85% of asset value) 42,500,000 42,500,000 Depreciation Term for Building and Improvements (years) 27.5 27.5 Annual Depreciation $ 1,545,455 $ 1,545,455

Yield on Cost (Cap Rate) 4.75% 6.00%Net Operating Income $ 2,375,000 $ 3,000,000

Loan to Value 65% 60%Equity 17,500,000 20,000,000 Loan Amount 32,500,000 30,000,000 Interest Rate 2.00% 4.75%

Amortization Interest Only Amortizing Annual Interest $ 650,000 $ 1,425,000 Annual Principal Paid — (471,284)

Annual Capital Expenditures, 300 units at $800 per unit $ 240,000 $ 240,000

Annual Free Cash FlowNet Operating Income $ 2,375,000 $ 3,000,000 Less Interest (650,000) (1,425,000)Less Principal Paid — (471,284)Less Capex (240,000) (240,000)Annual Free Cash Flow 1,485,000 863,716 Free Cash Flow Yield On Equity* 8.49% 4.32%Free Cash Flow plus Amortization Yield On Equity 8.49% 6.68%

Taxable IncomeNet Operating Income 2,375,000 3,000,000 Less Interest (650,000) (1,425,000)Less Depreciation (1,545,455) (1,545,455)Taxable Income 179,545 29,545 Taxable Income as a % of Invested Capital 1.03% 0.15%

*Cash flow available for distribution

— 11 —

These examples are simplified versions of what a typi-cal investor will actually experience, and each investor’s tax situation varies (please consult your tax advisor for specific guidance). The examples are meant to show the gist of what an investor would experience under typical investment parameters in the marketplace today.

EXAMPLE 1 Example 1 shows an asset worth $50M. It assumes the land value is 15% of the asset value, with depreciable buildings and improvements comprising the remaining 85% of the value. It assumes the asset has net operat-ing income of $2.375M and was purchased at a cap rate of 4.75%. It assumes the asset is funded by a variable-rate loan at 65% of the asset value, typical of many of the loans that we are placing on our assets today, with interest-only payments at a current rate of 2%. Also, the project is experiencing annual capital expenditures of $240,000.

As Example 1 shows, this project will produce annual free cash flow of $1.485M, an 8.49% yield on the invest-ed equity. Finally, the last section of Example 1 shows that on a taxable basis, only slightly over 1.00% of the entire 8.49% distribution would be currently taxable.

EXAMPLE 2 Example 2 shows another asset worth $50M with a num-ber of similarities with Example 1, although this project

has a fixed interest rate loan. CWS has bought several assets such as this at a slightly higher cap rate (a 6.00% example is shown here) in exchange for assuming a “bad” loan (i.e. unfavorable loan terms), in this case a loan with a fixed rate of 4.75%, currently amortizing, with a loan to value of 60%. As a result, we have cash flow available for distribution in the amount of 4.32%, almost all of which is not currently taxable. (An addition-al 2.36% of the equity goes to paying down the loan, which is not spendable but helpful nonetheless.)

Finally, when the time is right to sell the asset, CWS typically offers the option to participate in a 1031 ex-change into another asset, providing the ability to again defer taxes versus paying taxes on any gain.

As real estate investors learned in the 1980’s, it is not wise to invest in real estate exclusively for tax benefits. At CWS, we invest based on solid fundamentals, such as supply, demand, demographics, and replacement cost. That said, over time investing with CWS also offers important tax benefits that can make a significant differ-ence over competitive investment options.

Mike Engels Partner –– Chief Investment Officer

We’ll take what the other team gives us.

We’ll scratch where it itches. — Hayden Fry,

University of Iowa Head Coach, 1979–1998

— 13 —

Most of you already do some or all of these things, but it’s always good to review a checklist each time you make an investment. By taking a closer study of each investment playbook, you will build strength in your invest-ment knowledge as well as provide a safety position on the defensive-side, in case the play call on the field is different than you anticipated.

LIQUIDITY Is your capital on hand and income adequate to handle your anticipated needs until you reach the goal line, within 7–10 years?

RISK Real estate has up and down cycles with a long-term trend towards rising values. Having organizational strength can make the difference in powering through the holes to keep the offensive drive moving forward. This means you may need to have some capital available in case the property needs an infusion at the bottom of a cycle or Black Swan event. You want a General Partner that is well-funded and resourceful. Fortitude, knowledge, and conviction are required for successful scoring drives.

DIVERSIFICATION Having a number of different plays in the playbook can provide safety and diversification. Reviewing the property’s location, market, city, and state will serve you well, knowing that if the defense decides to blitz, you have other offensive players who can get open to score a touchdown.

ORGANIZATION Have well-regarded “coaches” in the General Partnership or Company, someone you can call for answers to your questions about the property, financial reports, and market conditions. Having two or three coaches to call is even better.

MANAGEMENT Know the top three people who will be responsible for quarterbacking the property acquisition and who will guide it successfully to meet or exceed the pro forma you used when making the investment. The goal is to be in a good investment with a great General Partner who has an excellent reputation for winning investment championships.

RECORD MANAGEMENT Have a safe place to keep your records of each investment. You can do this by keeping them in a safe at home, accessing an

electronic version on a secure investor portal, or asking your accountant to keep a digital record for you in his office.

TAX At the end of each year you will get your K-1 to review and forward to your accountant. It is important to understand the benefits of property depreciation which can delay some of your distribution tax liability. It is also important to know the benefits of a 1031 exchange when your property sells, which will allow your gains to be deferred when exchanged into a like-kind property.

ACCOUNTANT It is important to have an accountant on the sidelines who is knowledgeable in real estate limited partnerships and the applicable tax laws. The items outlined in the Tax Check of depreciation, 1031 exchang-es, and how you can use the tax shelter benefits can have substantial dollar benefits to you. Your accountant should be able to assure you that you are paying only the taxes you owe and not any more.

ESTATE PLAN There are several very good estate planning attorneys that can set up your wills and trusts and other sophisticated legal structures to guide you to the most effective way to organize and “hand off” your wealth to your family, charities, or institutions as you desire. You will want an attor-ney that knows the playbook of estate planning and the tax rules that apply.

FINAL CHECK In allocating your capital, consider most carefully your knowledge and conviction about the investment playbook, the people you must trust, the property, and the location. You are making a long-term com-mitment that may or may not be smooth in getting to a desired return, but the probable outcome is that you will be getting the return outlined to you at the time of investment. Since investment results are not guaranteed, the best investment advice is to pick good head coaches who have a great reputation for success.

Many happy returns on your investment!

Bill Williams Founder & Advisory Board Member

If what you did yesterday seems big, then you haven’t done anything today. — Lou Holt z

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P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT LADERA VISTA AUSTIN 224

THE MARQUIS AT CAPROCK CANYON AUSTIN 336

WINDSOR AT BARTON CREEK AUSTIN 134

NORTHWEST HILLS APARTMENTS AUSTIN 314

SOCO ON THE LAKE AUSTIN 100

THE MARQUIS AT GREAT HILLS AUSTIN 406

THE MARQUIS AT TREE TOPS AUSTIN 240

AUSTIN MIDTOWN APARTMENTS AUSTIN 276

THE MARQUIS AT VOLENTE AUSTIN 208

THE MARQUIS AT CENTER RIDGE AUSTIN 348

THE MARQUIS AT TECH RIDGE AUSTIN 294

MARQUIS SHORELINE AUSTIN 280

THE MARQUIS AT BARTON TRAILS AUSTIN 150

REGENTS WEST AT 26TH AUSTIN 139

MARQUIS AT BRUSHY CREEK AUSTIN 360

SoNA AUSTIN 164

MARQUIS AT CANYON RIDGE AUSTIN 264

REGENTS WEST AT 24TH AUSTIN 93

TOTAL 4,330

The Austin-San Marcos, TX MSA is home to over 1.8 million people and is one of the fastest growing MSA’s in the country. According to the U.S Bureau of Labor Statistics (BLS), total annual aver-age non-farm employment increased by 29,600 jobs, or by 3.4% from October 2013 to October 2014, far above the U.S. pace of 2.0%. The job market is expected to continue to accelerate in 2015 pro-ducing gains of nearly 40,000, or 4.5% growth. As of September, according to the BLS, the unemployment rate had fallen to just 4.5%, far below the national average of 6.2%.

Entering 2015, Austin is facing another year of increased development with over 10,000 units expected for the second year in a row. The glut of supply delivered in 2014 resulted in a slight increase in vacancy moving from 4.5% in 2013 to 5.2% in 2014. Vacancies are expected to remain at 5.2% throughout 2015 as a steady amount of sup-ply hits the market. The new supply will slow rents slightly in 2015 to a forecasted increase of 3.5%, down from an increase of 4.0% experienced in 2014. We will be keep-ing a close eye on the glut of new supply hitting the market in 2015, but overall we anticipate a strong year for Austin.

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Austin

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT TURTLE CREEK DALLAS 98

THE MARQUIS ON GASTON DALLAS 480

THE MARQUIS ON CEDAR SPRINGS DALLAS 165

THE MARQUIS AT TEXAS STREET DALLAS 302

THE MARQUIS OF STATE THOMAS DALLAS 211

MARQUIS WEST END DALLAS 146

L2 AT UPTOWN DALLAS 321

THE MARQUIS AT LANTANA FLOWER MOUND 248

THE PARK AT FLOWER MOUND FLOWER MOUND 352

THE MARQUIS AT STONEGATE FORT WORTH 308

THE MARQUIS AT BELLAIRE RANCH FORT WORTH 316

FIRESTONE WEST 7TH FORT WORTH 350

THE MARQUIS AT SILVER OAKS GRAPEVINE 480

BROOKS ON PRESTON PLANO 342

THE PARK ON SPRING CREEK PLANO 278

MARQUIS AT LEGACY PLANO 268

THE MARQUIS AT WATERVIEW RICHARDSON 528

TOTAL 5,193 According to the US Bureau of Labor Sta-tistics, the Dallas/Fort Worth (DFW)metro boasted an increase in employment growth in 2014 equal to 136,900 additional jobs (4.4% year over year). Professional and business services saw the largest job growth of all the employment fields. In total there were seven different major industry sectors that saw an increase of at least 10,000 jobs in 2014, illustrating the metro’s economic diversity. The DFW area saw the unemployment rate fall from 5.5% in December 2013 to 4.0% in December 2014. The metro is expected to see contin-ued growth in 2015, having recently lured several major employers like State Farm, Toyota and Liberty Mutual.

The DFW apartment market continues to perform well above average norms. Despite the addition of 13,423 new units in 2014, the apartment metro posted its lowest vacancy rate since 2000 at 4.9% and saw effective rent growth of 4.1% (well above its 10-year average of 2.2%). An additional 14,168 new units are expected in 2015, with vacancy rates forecasted to increase slightly to 6.0% (still below the metro’s 10-year average of 8.0%) and effective rents projected to increase by an additional 3.5% again year over year. Overall, the DFW apartment market is poised for another strong year — with a diverse economy, consistent job growth, and a continued multifamily hous-ing shortage as the major contributors.

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DAllAs/Ft. Worth

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT DEERFIELD SAN ANTONIO 340

THE PARK AT WALKER'S RANCH SAN ANTONIO 300

MARQUIS 5655 (FORMERLY MARQUIS LA CANTERA) SAN ANTONIO 208

THE MARQUIS AT STONE OAK SAN ANTONIO 332

TOTAL 1,180 San Antonio is the seventh-largest city in the United States. Famous for its River-walk, the Alamo, the Tejano culture, and home to world-class theme parks, the city of San Antonio is a haven for corporate and residential relocations. Currently, USAA, H-E-B, Rackspace, Valero Energy, Tesoro, and Clear Channel Communica-tions, among others, call this city home. After a relatively slow 2014, San Anto-nio’s apartment fundamentals should strengthen in 2015 as increased job creation and population growth drive demand for housing. The San Antonio metropolitan area experienced slower than expected growth in 2014 largely in

part to a glut of new supply delivered in the 1st and 2nd quarter. Through October of 2014, San Antonio created 21,400 new jobs, an increase of 5,000 jobs over the previous year. The increase in job growth should help to fill approximately the 4,400 units expected to deliver in 2015. Witten Advisors projects all of the new supply to be absorbed in 2015 and proj-ects occupancy to increase to 93.5%, an increase of slightly less than 1%. Witten Advisors expects effective rent growth at a modest 2.0% for 2015. The main driv-ers in San Antonio continue to be health care, tourism, and the Eagle Ford Shale drilling activity.

SAn Antonio

— 21 —

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT PIN OAK PARK HOUSTON 474

THE MARQUIS AT WESTCHASE HOUSTON 216

THE MARQUIS ON WESTHEIMER HOUSTON 288

THE MARQUIS ON MEMORIAL HOUSTON 104

THE MARQUIS ON BRIAR FOREST HOUSTON 396

MARQUIS DOWNTOWN LOFTS HOUSTON 244

THE MARQ ON VOSS HOUSTON 307

MARQUIS LOFTS AT HERMANN PARK HOUSTON 380

MARQUIS LOFTS ON SABINE HOUSTON 198

MARQUIS ON PARK ROW HOUSTON 400

M5250 HOUSTON 298

MARQUIS AT TANGLEWOOD HOUSTON 162

THE MARQUIS AT KATY KATY 258

MARQUIS AT CINCO RANCH KATY 180

MARQUIS AT KINGWOOD KINGWOOD 320

THE MARQUIS AT THE WOODLANDS SPRING 280

THE MARQUIS AT SUGAR LAND SUGAR LAND 312

THE MARQUIS AT CLEAR LAKE WEBSTER 364

TOTAL 5,181 Houston is one of the fastest growing metropolitan areas in the United States and has a population of roughly 6.3 mil-lion people. In 2014, Houston’s economy had another strong year of employment growth with 120,600 jobs added equat-ing to a 4.2% job growth figure based on December 2014 versus December 2013. As a result of the recent drop in the price of oil, many economists predict job growth to slow in 2015. For example the Greater Houston Partnership is predict-ing Houston will add 62,900 jobs in 2015, which is still a healthy growth rate at 2.1%. Houston’s economic drivers include the energy industry, international trade through the Port of Houston, and the

Texas Medical Center, which is the larg-est medical complex in the nation. These industries have helped to shield Hous-ton’s unemployment rate at levels that are lower than the national average. For example, as of December 2014, Houston’s unemployment rate was at 4.1% which is down from 5.0% in 2013. The combination of the factors listed above has fueled apartment rental demand not seen since 2005. Over the past 12 months, Houston added 12,046 units and absorbed 9,880 units, which increased vacancy slightly from 6.0% to 6.2% over 2014. While Houston added more units than it absorbed, the rent growth was still positive at 5.2% for 2014.

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Houston

20

14

STATE CITY PROPERTY NAMEYEAR

ACQRD.YEAR BUILT UNITS

POTENTIALBUILD-OUT

POT.UNITS

ARIZONA TEMPE REGENTS ON UNIVERSITY 2014 2010 225 0 225 CALIFORNIA FOLSOM FAIRMONT AT WILLOW CREEK 2001 2001 260 0 260 COLORADO BROOMFIELD THE MARQUIS AT TOWN CENTRE 2000 2000 283 0 283

DENVER MARQUIS AT THE PARKWAY 2005 1983 460 0 460 LONE TREE THE MARQ AT RIDGEGATE 2014 2010 243 0 243

GEORGIA ATLANTA THE MARQUIS AT BRIARCLIFF 2006 1995 104 0 104 ATLANTA THE MARQUIS AT PERIMETER CENTER 2012 1980 204 0 204 ATLANTA MARQUIS OF NORTH DRUID HILLS 2013 1994 182 0 182 ATLANTA MARQUIS MIDTOWN WEST 2013 1997 156 0 156 ATLANTA MARQUIS 2200 2013 2010 399 0 399 DULUTH MARQUIS AT SUGARLOAF 2013 1995 303 0 303 DULUTH MARQUIS ON BERKELEY 2013 2002 323 0 323 ATLANTA MARQUIS MIDTOWN DISTRICT 2014 2008 372 0 372 ATLANTA THE MARQ AT BROOKHAVEN 2014 1998 480 0 480 SANDY SPRINGS M789 2014 1999 300 0 300

NORTH CAROLINA

CHARLOTTE THE MARQUIS OF CARMEL VALLEY 1998 1998 424 0 424 CHARLOTTE THE PRE. AT BALLANTYNE COMMONS 1999 1998 270 0 270 CHARLOTTE THE MARQUIS AT CARMEL COMMONS 1999 1999 312 0 312 CARY THE MARQUIS AT PRESTON 2000 1996 292 0 292 CARY THE MARQUIS AT SILVERTON 2005 1996 216 0 216

TEXAS AUSTIN THE MARQUIS AT LADERA VISTA 1996 1996 224 0 224 AUSTIN THE MARQUIS AT CAPROCK CANYON 2000 1994 336 0 336 AUSTIN WINDSOR AT BARTON CREEK 2005 1978 134 0 134 AUSTIN NORTHWEST HILLS APARTMENTS 2005 78/79 314 0 314AUSTIN SOCO ON THE LAKE 2006 1973 100 0 100AUSTIN THE MARQUIS AT GREAT HILLS 2007 1995 406 0 406 AUSTIN THE MARQUIS AT TREE TOPS 2007 1997 240 0 240 AUSTIN AUSTIN MIDTOWN APARTMENTS 2011 1978 276 0 276 AUSTIN THE MARQUIS AT VOLENTE 2011 1999 208 0 208 AUSTIN THE MARQUIS AT CENTER RIDGE 2012 2008 348 0 348 AUSTIN THE MARQUIS AT TECH RIDGE 2012 2007 294 0 294 AUSTIN MARQUIS SHORELINE 2012 2001 280 0 280 AUSTIN THE MARQUIS AT BARTON TRAILS 2012 1998 150 157 307 AUSTIN REGENTS WEST AT 26TH 2013 2013 139 0 139 AUSTIN MARQUIS AT BRUSHY CREEK 2013 2009 360 0 360 AUSTIN SoNA 2013 1985 164 0 164 AUSTIN MARQUIS AT CANYON RIDGE 2014 2007 264 0 264 AUSTIN REGENTS WEST AT 24TH 2014 2014 93 0 93 DALLAS THE MARQUIS AT TURTLE CREEK 2002 1998 98 0 98 DALLAS THE MARQUIS ON GASTON 2005 1996 480 0 480 DALLAS THE MARQUIS ON CEDAR SPRINGS 2006 2002 165 0 165 DALLAS THE MARQUIS AT TEXAS STREET 2007 2003 302 0 302 DALLAS THE MARQUIS OF STATE THOMAS 2010 2010 211 0 211 DALLAS MARQUIS WEST END 2012 2008 146 0 146

STATE CITY PROPERTY NAMEYEAR

ACQRD.YEAR BUILT UNITS

POTENTIALBUILD-OUT

POT.UNITS

TEXAS DALLAS L2 AT UPTOWN 2013 2013 321 0 321 FLOWER MOUND THE MARQUIS AT LANTANA 2008 2000 248 0 248 FLOWER MOUND THE PARK AT FLOWER MOUND 2011 84/98 352 0 352 FORT WORTH THE MARQUIS AT STONEGATE 2002 1996 308 0 308 FORT WORTH THE MARQUIS AT BELLAIRE RANCH 2003 1997 316 0 316 FORT WORTH FIRESTONE WEST 7TH 2012 1999 350 0 350 GRAPEVINE THE MARQUIS AT SILVER OAKS 2005 2002 480 0 480 HOUSTON THE MARQUIS AT PIN OAK PARK 2007 1992 474 0 474 HOUSTON THE MARQUIS AT WESTCHASE 2007 1995 216 0 216 HOUSTON THE MARQUIS ON WESTHEIMER 2007 98/99 288 0 288 HOUSTON THE MARQUIS ON MEMORIAL 2007 1992 104 0 104 HOUSTON THE MARQUIS ON BRIAR FOREST 2007 2004 396 0 396 HOUSTON MARQUIS DOWNTOWN LOFTS 2010 2002 244 0 244 HOUSTON THE MARQ ON VOSS 2012 2009 307 0 307 HOUSTON MARQUIS LOFTS AT HERMANN PARK 2012 2005 380 0 380 HOUSTON MARQUIS LOFTS ON SABINE 2013 2002 198 0 198 HOUSTON MARQUIS ON PARK ROW 2013 1999 400 0 400 HOUSTON M5250 2014 2013 298 0 298 HOUSTON MARQUIS AT TANGLEWOOD 2014 1994 162 0 162 KATY THE MARQUIS AT KATY 2012 2008 258 0 258 KATY MARQUIS AT CINCO RANCH 2014 2011 180 80 260 KINGWOOD MARQUIS AT KINGWOOD 2014 1998 320 0 320 PLANO BROOKS ON PRESTON 1998 1998 342 0 342 PLANO THE PARK ON SPRING CREEK 2006 1984 278 0 278 PLANO MARQUIS AT LEGACY 2014 1991 268 0 268 RICHARDSON THE MARQUIS AT WATERVIEW 1999 1998 528 0 528 SAN ANTONIO THE MARQUIS AT DEERFIELD 1996 1996 340 0 340 SAN ANTONIO THE PARK AT WALKER’S RANCH 2007 1995 300 0 300 SAN ANTONIO MARQUIS 5655 2012 2000 208 0 208 SAN ANTONIO THE MARQUIS AT STONE OAK 2012 2000 332 0 332 SPRING THE MARQUIS AT THE WOODLANDS 2012 2007 280 0 280 SUGAR LAND THE MARQUIS AT SUGAR LAND 2012 2009 312 0 312 WEBSTER THE MARQUIS AT CLEAR LAKE 2012 2006 364 0 364

APARTMENT TOTALS 21,692 237 21,929

C U R R E N T D E V E L O P M E N T STEXAS AUSTIN SOCO ON THE LAKE — PHASE 1 REDEVELOPMENT 0 260 260

AUSTIN 7 RIO 0 220 220 HOUSTON MARQUIS AT GREENWAY GARDENS 0 453 453 HOUSTON BROADSTONE FOUNTAIN VIEW 0 281 281

DEVELOPMENT TOTALS 0 1,214 1,214

M A N U F A C T U R E D H O U S I N G C O M M U N I T I E STEXAS DALLAS HARSTON WOODS 411 O 411

MANUFACTURED HOUSING COMMUNITY TOTALS 411 O 411

CWS DEVELOPMENTS 22,103 1,451 23,554

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT BRIARCLIFF ATLANTA 104

THE MARQUIS AT PERIMETER CENTER ATLANTA 204

MARQUIS OF NORTH DRUID HILLS ATLANTA 182

MARQUIS MIDTOWN WEST ATLANTA 156

MARQUIS 2200 ATLANTA 399

MARQUIS MIDTOWN DISTRICT ATLANTA 372

THE MARQ AT BROOKHAVEN ATLANTA 480

MARQUIS AT SUGARLOAF DULUTH 303

MARQUIS ON BERKELEY DULUTH 323

M789 SANDY SPRINGS 300

TOTAL 2,823 With a metro population estimated at 5.61 million as of the end of 2014, the Atlanta MSA is the ninth largest in the nation. Over the next five years, the pop-ulation is projected to total 6.1 million, translating into average annual popula-tion growth of approximately 100,000 per annum over this period. Employment numbers continue to climb as Atlanta has now posted employ-ment gains in each of the last five years. Almost 59,000 jobs were added in the metro over the 12 months ending Novem-ber 2014; this is an increase of 2.4% which is above the national average of 2.0%. Industries with the greatest increase in jobs include trade, transportation, and utilities, increasing by 24,200 or 4.4%, followed by professional and business services increasing by 13,300 or 3.0%. The outlook is for employment growth to con-

tinue at a similar pace in 2015, with a pro-jected 63,000 jobs being added. Construction activity is picking up from the minimal levels over the past few years but remains much lower than the levels posted between 2000 and 2009. During that period, single-family and multi-family permits averaged 54,000 units (22% multi-family) per annum; the number of permits issued in 2014 totaled only 26,400 units (36% multi-family), almost 51% below the 10-year average. The limited amount of new units being added to supply bodes well for both mul-tifamily rent growth and occupancy. Over the past 12 months, effective rental rates have climbed by 3.8% while occu-pancy increased by 0.4%. Effective rents are projected to increase by another 3.8% in 2015 while occupancy is expected to rise by 0.5%.

— 27 —

AtlAntA

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS OF CARMEL VALLEY CHARLOTTE 424

THE PRESERVE AT BALLANTYNE COMMONS CHARLOTTE 270

THE MARQUIS AT CARMEL COMMONS CHARLOTTE 312

TOTAL 1,006 The Charlotte MSA is a six-county area with a current population of approxi-mately 1.92 million. Over the next five years, the population is expected to exceed 2.16 million, indicating annual growth upwards of 48,000 per annum. Local employment grew by 24,400 jobs or 2.8% during 2014, well ahead of the national average of 2.0%. The relatively strong pace of employment growth is expected to continue through 2016 with the addition of an estimated 27,000 to 29,000 new jobs annually. Multi-family permits rose to over 6,500 units in 2014, the highest level posted since 1999. The number of units per-mitted in 2014 was about 56% above the average since 2000. This pace of develop-

ment could pose a challenge to the health of the apartment market. Occupancy has remained strong so far, currently stand-ing at 94.9%. Although some decline in occupancy is expected over the next few years, occupancy is expected to remain at 92% or higher through 2019 despite these anticipated additions to inventory. Demand for apartments in the Char-lotte MSA should remain strong due to the area’s favorable rental demographic and home ownership not being as com-petitive as in many other metros. Effec-tive rents climbed 4.0% in 2014, but some moderation in this growth rate is expected in 2015 and beyond. The growth expected for 2015 is pegged at 3.8%, fol-lowed by 3.0% in 2016.

— 29 —

ChArlotte

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT PRESTON CARY 292

THE MARQUIS AT SILVERTON CARY 216

TOTAL 508 The Raleigh-Durham Cary CSA (or Raleigh/Durham) currently has a popu-lation of nearly 1.8 million people, with an expansion of 32,000 in 2014. Over the next five years, Raleigh/Durham’s popu-lation is expected to increase to approxi-mately 2.0 million, equating to an average increase of nearly 40,000 per annum. Raleigh/Durham has a diverse employ-ment base consisting primarily of tech-nology, government, biotechnology, and education. This diversity has enabled the local economy to fare better than most through the recent economic challenges. In 2014, approximately 24,100 jobs were added in Raleigh/Durham, equating to a 2.9% gain and exceeding the national aver-age of 2.0%. This pace is expected to accel-erate moderately in 2015 with a projected 27,400 new jobs being added.

Multi-family development activity remains at above average levels with almost 4,900 units permitted in 2014. However, this is a reduction from 2013 activity levels when permits totaled approximately 6,300 units. Due to this level of construction activity, the occu-pancy rate ended 2014 at 93.3%, a drop of 1.7% during the year. Occupancy is expected to slide a little bit more, bot-toming at 91.5% in 2017 and beginning a modest recovery from there. With regard to effective rents, they climbed by 4.8% in 2014. Rental growth is projected at 3.4% in 2015 and then is expected to moder-ate at annual rates between 2% and 3% through 2019. With strong job growth expected to continue through 2019, the outlook for multi-family performance remains favorable.

— 31 —

RAleigh

P R O P E R T Y N A M E L O C AT I O N U N I T S

THE MARQUIS AT TOWN CENTRE BROOMFIELD 283

MARQUIS AT THE PARKWAY DENVER 460

THE MARQ AT RIDGEGATE LONE TREE 243

TOTAL 986 Metro Denver, with a population of over 2.8 million people, has achieved a growth rate that is consistently above that of the nation. Over the next five years, Metro Denver’s population is anticipated to increase to almost 3.0 million, equating to average annual increases of slightly more than 40,000. Metro Denver has an enviable quality of life that makes it one of the best places in the United States to live and work. In 2014, employment in Denver grew with the addition of 37,600 jobs, equating to a 2.3% increase, above the national average of 2.0%. This pace is expected to continue in 2015 as 35,000 new jobs are projected. Although vacancy increased from 3.5% at the end of 2013 to 4.2% as 2014 ended, anything under 5% vacancy is considered

to be indicative of a very strong market. Effective rents climbed by an exception-ally strong 7.9%. With a large percent-age of younger workers (below age 30), recent declines in the home ownership percentage, and construction of new housing units continuing at very mod-erate levels, market conditions continue to improve. Apartment completions in 2014 climbed to 6,810 units, but this is only 3.7% of total inventory. Apartment construction deliveries are expected to increase by 14,600 units through 2016 with absorption expected to increase to 5.7%. Average vacancy at this level is still indicative of strong market conditions. Furthermore, rental rate growth in the Denver apartment market is expected to climb at a very strong 5.3% in 2015.

— 33 —

Denver

P R O P E R T Y N A M E L O C AT I O N U N I T SREGENTS ON UNIVERSITY TEMPE 225

TOTAL 225 Greater Phoenix continues to be among the fastest growing metropolitans in the nation with a metro population of roughly 4.2 million people. Forbes listed Phoenix as number three on their 2014 list of America’s fastest growing cities. Although Phoenix was hit particularly hard by the Great Recession it has contin-ued to slowly rebound. Greater Phoenix is estimated to have added over 40,000 new jobs in 2014, giving it a job growth rate of 2.3% compared to US job growth of 2.0%. Preliminary estimates for 2015 pre-dict a job growth rate of about 3.5%. For-tune 500 companies headquartered in the greater Phoenix area include PetSmart, Avent, Republic Services, and Insight Enterprises. Top employers in metro Phoenix include Bank of America, Banner Health, the State of Arizona, Wells Fargo, City of Phoenix, JP Morgan Chase, Intel, and Arizona State University.

Arizona State University is located in the metro Phoenix submarket of Tempe, Arizona. ASU is one of the largest tier one universities in the United States, enroll-ing more than 65,000 undergraduate and graduate students at its Tempe campus alone as of fall 2014. Total enrollment at Tempe has increased over 20% since 2006, due in large part to the University’s 2006 master plan which heavily empha-sized enrollment growth goals through 2020. On-campus University owned or operated student housing supply is lim-ited to approximately 12,500 beds which, based on current enrollment, leaves a potentially sizable number of students in need of off-campus housing alternatives. The gap between on-campus student beds and overall enrollment should place upward pressure on off-campus student housing demand, particularly if the uni-versity continues its pattern of growth.

— 35 —

Phoenix

B.R.I.D.G.E. is a corporate volunteer program de-signed to encourage employees to give back to their community through volunteer work. B.R.I.D.G.E. contributes $20 for each hour of community service an employee completes up to a maximum of 12 hours ($240). An employee may volunteer time at any type of institution, agency, or community service program, except activities that directly relate to a political party or office. An employee can decide where half of the annual contribution goes at any time during the year. The remaining half of an employee’s contribution is put into a company-wide pool and distributed based on employee nominations taken at the end of the year. Since its inception in 1996, B.R.I.D.G.E. has become an integral part of CWS culture and a means to demon-strate our company values on a daily basis. From 2001 to 2014, over $675,000 was donated to hundreds of or-ganizations and donation recipients.

B.R.I.D.G.E. ProgrAm

AIDS Healthcare FoundationAlameda Youth SportsAll About Developmental DisabilitiesALS AssociationAlzheimer’s Association, ChicacoAlzheimer’s Association, DallasAmerican Heart AssociationAngel House Soup KitchenArni FoundationASPCAASPCA Austin - Town Lake Animal CenterAustin Dog Alliance - Hounds for HeroesAustin Dog RescueAustin Pets AliveAustin Sunshine CampsBurke Center for YouthCare PossibleCedar Ridge Tennis Booster ClubCelebration of Love/Solidiers of AmericaCharitable Ventures of Orange CountyChild SafeChildren’s ClinicChildren’s ShelterChrist Community ChurchChrist the Incarnate Word Catholic ChurchChristi CenterCitizens for Animal ProtectionCommunity Partners of DallasCoppell Grapevine Police Charitable Assoc.Crossmen ProductionsCrosswalk ChurchCystic Fibrosis FoundationDavis Magnet School Education FoundationDogs on DeploymentDress for SuccessErin Krielow Lahr Memorial ScholarshipEvergreen MBCFirst United Methodist ChurchFlorence Head StartFounders Classical AcademyGateway ChurchGirl Scouts Troop 1450

Give Kids the World VillageGreater St. Matthew Baptist ChurchHearts & Hands at North Davis Church of ChristHope AllianceHosea HouseHouston SPCAHumane Society of CharlotteIglesia Gran ComisionJim Plain Elementary PTAKraus Children’s CenterLake Norman Pirates LeapMarch of DimesMaria Romero Medical BillsMatos PshychiatryMD AndersonMike’s PlaceMildred Osborne Charter SchoolMision Vida CristianaMothers Against Drunk DriversNational MS SocietyNorth Texas SNAPNorthwest FellowshipOperation Liberty HillPack 820 - CubscoutsPats Place Child Advocacy CenterPennies for PoshoPhyllis CobbPrimera Iglesia BautistaPug Rescue of AustinRainbow VillageRCBA Athletic Booster ClubRonald McDonald HouseSalvation Army Kroc Community CenterService Dogs Inc.The JourneyTurning Point ChurchVillage Bicycle ProjectWarrior Foundation Freedom StationWounded Warriors ProjectXRC Crossroads Church

B.R.I.D.G.E. SERVICE ORGANIZATIONS & DONATION RECIPIENTS(nominated in 2014, paid in 2015)

— 37 —

FOUNDERS

STEVE SHERWOODFounding Partner, CEO, & Chairman of the BoardSince 1977

BILL WILLIAMSFounding Partner & Advisory Board MemberSince 1969

JIM CLAYTONFounderSince 1969

CORPORATE HOUSING

TRACY HAYESPresident, Corporate HousingSince 1994

MANUFACTURED HOUSING

JOE SHERWOODSenior Vice President, Manufactured HousingSince 1986

CAPITAL PARTNERS

GARY CARMELLPartner -- PresidentSince 1987

BRIAN ROSEChief Financial OfficerSince 1997

LINDA LILESVice President, Director of Human ResourcesSince 2004

MARY ELLEN BARLOWDirector, Transaction ServicesSince 1995

TREVOR DALLASManaging Director, CWS Strategic Apartment FundSince 2005

MARCUS LAMDirector of InvestmentsSince 2005

ALBERT STEINPerformance AnalystSince 2009

INVESTMENTS

MIKE ENGELSPartner -- Chief Investment OfficerSince 1998

DANIEL EBNERSenior Vice President, InvestmentsDallas/Fort Worth, TXSince 2004

MIKE BRITTINGHAMVice President, InvestmentsAustin & San Antonio, TXSince 2006

GREGG KANTAKInvestmentsDenver, CO, Charlotte/ Raleigh, NC & Atlanta, GASince 2007

JUSTIN LEAHYVice President, Investments Houston, TX & Atlanta, GA Since 2011

TeAm Roster

CAPITAL PARTNERS

LAURETTA ANDERSONVice President, Investor RelationsSince 1986

SUNNIE JUAREZ-MILLSInvestor Services Relationship ManagerSince 1997

SUSAN RAYSHELLDirector, Investor RelationsInformation SystemsSince 2008

MARK RUGGLESCompliance OfficerSince 2012

OPERATIONS

MARCELLUS MOSLEYSenior Vice President, Director of OperationsSince 2002

SHELLIE ALBOSTAVice President, MarketingSince 2001

HOLYCE CALDWELLRegional Marketing DirectorSince 2013

JACK BIEHUNKORegional Marketing DirectorSince 2014

MATT BAKERRegional Marketing DirectorSince 2014

OPERATIONS (CONT.)

SARAH COLANDRADue Diligence & Integrations ManagerSince 2007

CAREY MCDONALDDirector of Revenue ManagementSince 2012

JANIS T. COWEYDirector of Operational ExcellenceSince 1997

CHRISTINE DONEGANOperations/Development DirectorSince 2013

DEVELOPMENT

GREG MILLERVice President, DevelopmentSince 1994

BRAD BRAKHAGEVice President, ConstructionSince 2000

JEFF LAHRVice President, DevelopmentSince 2012

OPERATIONS

GINA ROBERTSRegional Vice PresidentSince 1997

DEBRA BUCKRegional Vice PresidentSince 2007

OPERATIONS (CONT.)

AMBER COXRegional DirectorFort Worth, TXSince 1998

RICH FAGANDirector of Due Diligence & IntegrationSince 2001

PAIGE GUTIERREZRegional DirectorAustin, TXSince 1998

BRETT MCDANIELRegional DirectorDallas & San Antonio, TXSince 2001

JOE KRUMREYRegional DirectorDallas, TXSince 2004

LINDSAY NYLANDERRegional DirectorDenver, CO & Austin, TXSince 2009

CHRISTINA SHAMBRORegional DirectorHouston, TXSince 2015

TRACEY GLOVERRegional DirectorNorth CarolinaSince 2013

TELISIA AMANINGRegional DirectorHouston, TXSince 2015

— 39 —

EPMS Customer Experience Best in Class AwardEllis Partners in Management Services (EPMS) awarded CWS the honor of having 34 CWS properties named “Best in Class” among the 75 properties they surveyed. Focusing their surveys on customer loyal-ty instead of just customer service measures the customer experience a company consistently provides. More information can be found on the EPMS website at www.epmsonline.com.

Top Workplace of Greater Austin The Austin American-Statesman hosts an annual survey program wherein local area associates rank companies in a number of work-place categories and provide their feedback. CWS has made the Top Places to Work list in 2011, 2012, 2013 and 2014. More information can be found on the Statesman website at www.statesman.com.

Top Workplace of HoustonIn 2014, CWS ranked fifth among small employers on the local Top Workplaces list compiled for the Houston Chronicle by Workplace-Dynamics. More information can be found on the Houston Chronicle website at www.chron.com.

Top Places to Work in Dallas/Fort WorthThe Dallas Morning News issued its Top 100 Places to Work for 2014 and CWS ranked number six among the top mid-size companies in the Dallas/Fort Worth area. More information can be found on the Dallas Morning News website at www.res.dallasnews.com.

Years in Operation 46Operating States 6Operating Cities 24

Total Employees 763Corporate Divisions 6Number of Partners 3

PERFORMANCE TOTAL REV.

Actual $310.0MBudget $308.0MVariance $2.0MPercent +.63

OPERATINGEXPENSES

Actual $139.6MBudget $139.9MVariance $.3MPercent +.22

NET OPERATINGINCOME/(LOSS)

Actual $170.4MBudget $168.1MVariance $2.3MPercent +1.34

1031 EXCHANGEHISTORY

Private TIC $65MComb. Equity $322MDeferr. Gain Assoc. with Equity $384M

TRACK RECORDSIMPLE AVERAGE

Investor Return Net of Fees 13.31%Multiple Net of Fees 2.04

PROPERTIES 77Austin 18Dallas/Ft. Worth 17San Antonio 4Houston 18Atlanta 10Charlotte 3Raleigh 2Denver 3Tempe 1Folsom 1

UNITS 21,692Austin 4,330Dallas/Ft. Worth 5,193San Antonio 1,180Houston 5,181Atlanta 2,823Charlotte 1,006Raleigh 508Denver 986Tempe 225Folsom 260

POPULATION BY CITY (MIL.)

Austin 1.9Dallas/Ft. Worth 6.8San Antonio 2.3

Houston 6.3 Atlanta 5.6Charlotte 1.9Raleigh 1.8Denver 2.8

POPULATION BY STATE (MIL.)

TX 26.9 CO 5.4GA 10.1 AZ 6.7NC 9.9 CA 38.8

INVESTOR INFO. Limited partners, financial advisors, investment advisors, or CPAs seeking additional information about CWS Investments or 1031 Exchange candidate investments should contact: Marcus Lam, Director of Investments 800.466.0020 | mlam@cwscapital.com

CONTACT INFO.TF 800.466.0020 T 949.640.4200 F 949.640.4931W cwscapital.com

CA HEADQUARTERS Street 14 Corporate Plaza Suite Number 210 City Newport BeachState & Zip CA 92660

TX HEADQUARTERSStreet 9606 N. Mopac Exp.Suite Number 500City AustinState & Zip TX 78759

Investment Opportunities offered by CWS Capital Partners LLC are through an affiliated entity, CWS Investments. CWS Investments is a registered Broker Dealer and member of FINRA, SIPC.

SUPPLEMENTAL INFORMATION An electronic file of the Supplemental Report is available behind our Investor Portal for all existing investors and potential investors that have registered with our office. To view detailed earnings overviews for each of our properties and submarket discussions for each of our regions, please visit www.cwscapital.com and log in to your account by clicking on the “My Account” link. If you have trouble accessing your account, please call Investor Relations at 800.466.0020.

NewLocationin Tempe

Capitol of Cali.

Home Field

TXHeadquarters

Good crab cakes & Coca-Cola

Oldest State University in U.S.— Chapel Hill

GreatSnowbarding