may 5, 2017 - loopnet...may 1, 2017. the date of this appraisal report is may 5, 2017. property tax....

May 5, 2017

Mr. Val Longoria Oak Valley Commercial Lending Via E-Mail: [email protected]

RE: A Restricted Appraisal Report of a 4,850 square foot (NRA) shopping center located at 5808 Cullen Boulevard, Houston, Texas 77021

Dear Mr. Longoria: At your request, we have prepared a restricted appraisal report for the aforementioned property. This report is limited to client use only, and the appraiser’s opinions and conclusions set forth in this report cannot be understood properly without additional information contained in our work file. The subject property is more specifically described in the accompanying report. The purpose of this appraisal is to provide an opinion as to the as is market value of the subject property. At the client’s request, the limited rent roll and lease information, and the rental rates being significantly higher than market, we have valued the subject in fee simple estate. All of the necessary data was gathered and analyzed in order to arrive at a value conclusion Based upon our research and analysis of the market, which is provided in the accompanying report, the indicated value of the subject, as of May 1, 2017, is as follows:

As Is Market Value

$660,000.00

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Purpose of Appraisal. The purpose of this assignment is to provide an opinion of the as is market value of the subject property’s fee simple estate. Market Value Definition. The definition and qualification of market value as prescribed by Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”), adopted under FDIC Rules and Regulations, Part 323 as follows:

"The most probable price a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specific date and the passing of title from the seller to buyer under conditions whereby:

1. Buyer and seller are typically motivated;

2. Both parties are well informed or well advised, and acting in what they consider their own best interests;

3. A reasonable time is allowed for exposure in the open market;

4. Payment is made in terms of cash in U.S. Dollars or in terms of financial arrangements comparable thereto; and

5. The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.”

Property Rights Appraised. Fee simple estate is defined by the Dictionary of Real Estate Appraisal, Sixth Edition, page 90, published 2016, by the Appraisal Institute as being:

“Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.”

Intended Use of the Appraisal. The intended use for this appraisal report is to assist Oak Valley Commercial Lending in asset valuation for estate planning purposes. Intended User(s) of the Appraisal. The intended user of this report is Oak Valley Commercial Lending. Use of this report by another company or individual is not intended by The Ambrose Group. Scope Of Work. According to The Dictionary of Real Estate Appraisal, Sixth Edition, copyright 2016, by the Appraisal Institute, “scope of work” is defined on page 209 as being:

“The type and extent of research and analysis applied in an assignment.”

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The scope of work is based upon the purpose of the appraisal and its intended use as previously discussed within this report. The appraisal development process completed by the Ambrose Appraisal Company consisted of the following items:

1. Physically identified and viewed the subject property. We reviewed tax records and a plat map of the property obtained from the Harris County Appraisal District. In addition, we received limited lease agreements from the client. In addition, operating information was not provided by the client.

2. Researched and collected data related to market conditions and market

activity, and considered those characteristics which have a legal, physical, or economic impact on the subject property. The sources of data used within this report included: public records, real estate brokers, property management companies, national real estate market.

3. Determined the Highest and Best use of the subject as vacant and as

improved, based on the data gathered and considering the legally permissible, physical possible, financially feasible, and most profitable use of the property.

4. Analyzed the data gathered through the use of appropriate and acceptable

appraisal methodology in order to develop a value indication from each applicable approach to value.

a. Income Capitalization Approach. Developing this approach to value

involved gathering comparable rental data and estimating expenses from expense comparables. This data has been physically identified by The Ambrose Group. The comparable rentals were compared to the subject and adjusted for the various factors that influence rental rates. An indicated market rental rate was developed bases on the analysis of the cumulative rental data. Capitalization rates were obtained from national surveys and comparable sales data. The value indicated by this approach was derived from the Direct Capitalization Method.

b. Sales Comparison Approach. Developing this approach to value involved the collection of comparable improved sales which have been physically identified by The Ambrose Group. Considering the principle of substitution, the improved sales were compared to the subject and adjusted for the various factors which influence value. An indicated value was developed based on the analysis of the cumulative sales data provided in this report.

c. Cost Approach. Due to the age of the existing improvements and the difficulty in estimating the physical depreciation, the Cost

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Approach to Value is considered the least reliable indicator of value for the subject property and has not been developed. The omission of this approach to value does not reduce the reliability of the final developed value.

5. Reconciled the results from the applicable approaches to value into reasonable value conclusions.

6. Estimated a reasonable exposure time and market time associated with the developed opinion of value.

The appraisal of the subject property is presented in the form of a Restricted Appraisal Report, and is intended to comply with the reporting requirements set forth under Standards Rule 2-2 of the Uniform Standards of Professional Appraisal Practice. Dates of Valuation and Report. Our opinion of the as is market value is effective as of May 1, 2017. The date of this appraisal report is May 5, 2017. Property Tax. The subject property is assessed by the Harris County Appraisal District under account numbers 058-173-000-0004, 058-173-000-0005, and 058-173-000-0003. The 2017 preliminary assessed value for the subject is $242,718.00, of which $46,330.00 is attributed to the land and $196,388.00 is attributed to the improvements. The subject is located in the tax districts of the Houston Independent School District, Harris County, Houston Community College, City of Houston, and Greater Southeast Management District. Based upon information obtained from the Harris Country Tax Office, there are no delinquent taxes owed on the subject. Property History. According to the information provided, Sandra Falconer has owned the subject in excess of three years. The subject property is currently being leased by four tenants with rental rates ranging from $22.19 to $32.00 per square foot, with an weighted average of $25.79 per square foot on a gross basis. In addition, the subject property is receiving an additional $3,200.00 per month on a gross basis from a food truck located on the property. According to our analysis the rental rates are significantly above market. As previously mentioned we were provided incomplete and unsigned lease agreements. At the client’s request, the limited rent roll and lease information, and the rental rates being significantly higher than market, we have valued the subject in fee simple estate and applied a market rental rate. No other property history information was provided. Description of Subject Property. The subject site may be legally described as 0.24 acre (13,500 square feet) of land being Tracts 3, 4, and 5, Block 1, Belmont, Section 1, Houston, Harris County, Texas. The subject is located along the northwest line of Cullen Boulevard, southwest of Griggs Road. The subject has approximately 150 lineal feet of frontage and access along Cullen Boulevard, with a maximum depth of approximately 90 lineal feet. The physical address of the subject is 5808 Cullen Boulevard, Houston, Texas 77021. The subject appeared level and well drained at the visit of the site. In

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addition, there were no soil or subsoil conditions which would restrict development, as evidenced by nearby improvements. We have examined the available flood maps that are provided by the Federal Emergency Management Agency and have noted that the subject site is located outside an identified Special Flood Hazard Area. According to Insurance Map, Panel Number 48201C0880M, it appears that the subject tract is located in Zone X, an area outside the 500-year flood plain (see Addenda for map). However, we are not surveyors, and we make no guarantee regarding this determination. The subject has standard utility easements. According to Harris County Appraisal District, Tract 5 of the subject property contains a drainage easement running from east to west. However, these easements are not believed to impact the overall development of the entire property. The subject is located within the City of Houston, which does not subscribe to zoning. There are no other significant legal constraints that would restrict development of the subject property. Thus, the subject’s current use as a medical office building is a legally permissible use. Improvement Analysis. The subject property is improved with a 4,850 square foot (NRA) shopping center. The building is constructed on a concrete slab foundation with steel framing; concrete block exterior walls, and a flat membrane roof. The interior contains: vinyl tile, sealed concrete, and carpet flooring; wood panel and gypsum board walls; acoustical tile ceilings; fluorescent lighting; and central air conditioning and heating. It should be noted that each unit contains a restroom. The subject property contain certain items that are furniture, fixtures and equipment which is considered personal property and are not valued in this report. Other improvements include: asphalt paving and parking, exterior lighting, security cameras, and landscaping. The subject has a land-to-building ratio of 2.78:1, which is considered adequate. The subject property was constructed in 1960 and is considered to be in average condition and functional in design. The Marshall and Swift Valuation Service is a nationally recognized cost-estimating service which publishes surveys indicating the normal useful life of various types of improvements. These surveys are based upon detailed studies of actual mortality, conditions, and typical ages at which major renovation or change in occupancy occur. The typical life expectancy for the subject property is approximately 40 years. The 40-year life expectancy estimate is further supported by analysis of typical improvement age tendencies throughout the Southwestern United States. The subject has an effective age of 25 years, with a remaining economic life of 15 years. Highest and Best Use. The highest and best use of the subject property, as vacant, is for commercial use. The highest and best use of the subject property as improved is for a continuation of existing use. The most probable buyer is an investor.

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INCOME CAPITALIZATION APPROACH The Income Capitalization Approach to Value consists of methods, techniques, and mathematical procedures that an appraiser uses to analyze a property’s capacity to generate benefits and convert these benefits into an indication of present value. The Income Capitalization Approach includes the principles of anticipation and change as well as supply and demand. Following is a brief discussion of each principle as it relates to this approach. Anticipation and Change. Since value is created by expectation of future benefits, this principle is especially applicable to this approach. According to The Appraisal of Real Estate, Fourteenth Edition, by the Appraisal Institute, page 440:

“All income capitalization methods, techniques, and procedures forecast anticipated future benefits and estimate their present value. This may involve forecasting the anticipated future income from a property or estimating a capitalization rate that implicitly reflects the anticipated pattern of change in income over time.” “The capitalization process must reflect the possibility that actual future income, expenses, and property value may differ from those originally anticipated by an investor on the date of appraisal. The more uncertainty there is concerning the future levels of these variables, the riskier the investment. Investors expect to earn a higher rate of return on riskier investments. This should be reflected in the discount capitalization rates obtained from market research.”

Supply and Demand. According to The Appraisal of Real Estate, Fourteenth Edition by the Appraisal Institute, page 440:

“The principles of supply and demand and the related concept of competition are particularly useful in forecasting future benefits and estimating rates of return in the income capitalization approach. Both income and rates of return are determined in the market.”

In order to property utilize the Income Capitalization Approach, the appraiser researches rents, occupancies, and operating expenses from competing properties and creates an Operating Statement for the subject. At that point, the appropriate capitalization technique is selected and applied to the subject’s income stream. The discussion on the following pages will demonstrate this procedure as it applies to the subject property. Market Rent. Market rent, as used in this report, is defined by The Appraisal of Real Estate, Fourteenth Edition, by the Appraisal Institute, page 447 as follows:

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“The rental income that a property would probably command in the open market. It is indicated by the current rents that are either paid or asked for comparable space with the same division of expenses as of the date of the appraisal.”

An investigation of properties similar to the subject was conducted in order to estimate the appropriate market rent for the subject. Some of the most comparable rentals are listed on the following pages.

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534 FMap Page:

Broker (713-981-6100)Data Source:

Address: 5115-5123 Martin Luther King Jr.Boulevard, Houston, Texas 77021

Year Built: 1960

Actual Vacancy Percent: 83.90%

Parking Area: Adequate

Lease Structure: Gross

Typical Lease Term: 3 t o 5 Years

This property has a quoted rate of $9.71per square foot on a triple net basis with$3.24 per square foot in triple netexpenses. We have added these rates toderive the gross rate for this property.

Comments:Date Confirmed: May 3, 2017

Building Size (NRA): 6,200 Sq. Ft.

Condition/Construction: Average/Brick

COMPARABLE RENT NO. 1

Reimbursable Expenses N/A

Annual Rental Rate: $12.95 per Sq. Ft.

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533 MMap Page:


Address: 4300 Griggs Road, Houston, Texas 77021

Year Built: 1968




Typical Lease Term: 3 to 5 Years

This represents a signed lease for 2,200square feet that commenced onNovember 2016.

Comments:Date Confirmed: May 3, 2017


Condition/Construction: Average/Masonry



Annual Rental Rate: $18.00 per Sq. Ft. (Contract Rental Rate)

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534 MMap Page:

Bartola Espinoza (713-239-2275)Data Source:

Address: 5205 Telephone Road, Houston, Texas77087

Year Built: 1981




Typical Lease Term: 3-5 years

This represents a signed lease out of a5,000 square foot building whichcommenced in August 2016 for two years.

Comments:Date Confirmed: February 10, 2017


Condition/Construction: Average/Metal & Glass



Annual Rental Rate: $12.50 per Sq. Ft.

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533 RMap Page:


Address: 6913 - 6917 Cullen Boulevard, Houston,Texas 77021

Year Built: 1965 (Renovated in 2013)



Lease Structure: Triple Net

Typical Lease Term: 3 Years

This is an in-place rental rate for a leasethat was executed in September 2015.

Comments:Date Confirmed: September 9, 2016


Condition/Construction: Average/Concrete Block



Annual Rental Rate: $13.33 per Sq. Ft. (Contract Rental Rate)

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Carmel High SchoolCarmel High SchoolCarmel High SchoolCarmel High SchoolCarmel High SchoolCarmel High SchoolCarmel High SchoolCarmel High SchoolCarmel High School

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Brookline ParkBrookline ParkBrookline ParkBrookline ParkBrookline ParkBrookline ParkBrookline ParkBrookline ParkBrookline Park

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LOCATION MAPBorrower or Owner: Subject Address: 5808 Cullen Blvd Census Tract: 3136.00City: HoustonLender or Client: Lat: 29.7014 Long: -95.3489

County: Harris State: TX Zip Code: 77021

File No. 170352

Prepared by Ambrose Appraisal using MapPro Service. MapPro Inc., PO Box 37427, Houston, TX 77237 1-866-3MAPPRO.

Rent 1: 5115 Martin Luther King Jr Blvd

Rent 2: 4300 Griggs Rd

Rent 3: 5205 Telephone Rd

Rent 4: 6913 Cullen Blvd

0 0.375

Miles

0.75

Copyright 1994-2017, MapPro Inc.

N

CAUTION: The location of property arrows shown on this map are approximate only. Inaccuracies may exist on map such as missing, incorrectly drawn, or incorrectly addressed streets. Please report any such inaccuracy to MapPro, Inc. so that appropriate corrections can be made.

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Improved Rents Analysis. The preceding rentals are believed to accurately reflect a cross section of the rental market within the immediate vicinity of the subject. This survey is also believed to reflect the properties with which the subject must compete. The following is a summary of the properties surveyed.

Rent Size Quality of Lease Annual RentalNo. NRA/SF Age Condition Construction Structure Rate/SF

1 6,200 1960 Average Brick Gross $12.95

2 5,600 1968 Average Masonry Gross $18.00

3 5,000 1981 Average Metal Gross $12.50

4 4,800 1965, 2013 Average Concrete Block Triple Net $13.33

MIN 4,800 1960 $12.50

MAX 6,200 1981 $18.00

Subj. 4,850 1960 Average Masonry N/A N/A

COMPARABLE RENTAL SUMMARY

When comparing these rents to the subject, factors considered for adjustment include: lease terms, location, size, age/condition, and quality of construction. Your attention is invited to the following Comparable Rental Adjustment Grid, which displays the procedure used to arrive at an adjusted per square foot rental rate for the comparable rentals.

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RENT 1 2 3 4

ANNUAL RATE/SF $12.95 $18.00 $12.50 $13.33LEASE STRUCTURE 0% 0% 0% 15%

TOTAL ADJUSTMENTS 0% 0% 0% 15%

ADJUSTED PRICE / SF $12.95 $18.00 $12.50 $15.33

LOCATION 0% 0% 0% 0%

SIZE 0% 0% 0% 0%

AGE/CONDITION 0% 0% 0% 0%

QUALITY OF CONSTRUCTION 0% 0% 10% 0%

NET ADJUSTMENTS 0% 0% 10% 0%

FINAL ADJUSTED RATE/SF $12.95 $18.00 $13.75 $15.33

MINIMUM $12.95

MAXIMUM $18.00

MEDIAN $14.54MEAN $15.01

ADJUSTMENT SUMMARY OF COMPARABLE RENTALS

The comparable rentals presented indicate an annual rental rate range of $12.50 to $18.00 per square foot. After adjusting for the factors which influence value, the rentals have an adjusted rental rate range of $12.95 to $18.00 per square foot, with a average of $15.01 per square foot and a mean of $14.54 per square foot. The subject property is currently being leased by four tenants with rental rates ranging from $22.19 to $32.00 per square foot with an weighted average of $25.79 per square foot. According to our analysis the rental rates to be significantly above market. As previously mentioned we were provided incomplete and unsigned lease agreements. At the client’s request, the limited rent roll and lease information, and the rental rates being significantly higher than market, we have valued the subject in fee simple estate. Based upon our analysis, we have estimated a market rental rate for the subject property at $15.00 per square foot on a gross lease basis. Gross Annual Income. This is the amount that the subject would generate if it were completely leased at market rent. The Gross Annual Income, based on the previously described market rent, is appropriate for calculation. In our analysis, the gross annual income computes to $72,750.00 in the Stabilized Operating Statement. In addition, the subject property is receiving an additional $3,200.00 per month from a food truck located on the property. We believe this rate is above market. Based upon conversations with other shopping center owner who lease to food trucks, we have estimated a rate of $500.00 per month or $6,000.00 for the food truck

14

Vacancy and Collection Loss. This figure represents that portion of the subject which would not be rented during the year and is simply percentage of the Gross Annual Income. The subject property is currently 100 percent occupied. In addition, CoStar indicates a current vacancy rate for commercial properties within a 3-mile radius at 3.6 percent. Based on an analysis of the subject and the market as a whole, we believe that a 5.0 percent vacancy rate is appropriate, which was applied in the Stabilized Operating Statement. Effective Annual Income. This figure is simply the amount that the subject will actually generate after reflecting Vacancy and Collection Loss. The effective annual income in the Stabilized Operating Statement is estimated to be $74,813.00. Operating Expenses. These are items necessary to maintain the subject property. Normally they include such items as: ad valorem taxes, property insurance, management, repairs and maintenance, and reserves for replacement. We were not provided any operating history for the subject property. Thus, we have analyzed operating expenses from comparable buildings in the Houston Area. The expense comparables have been retained in our files. Please see the Addenda for more information. Total Expenses. We have estimated the total expenses based on several comparisons and previous experience properties of the subject’s type. The total expenses are estimated to be $18,361.00, or $3.79 per square foot. Net Operating Income. This is the amount of income left after Expenses have been paid, but before Debt Service and Income Taxes. The Net Operating Income for the subject is $56,452.00 in the Stabilized Operating Statement. This figure will be utilized for Direct Capitalization. Further explanation of this procedure follows. Capitalization. This procedure involves converting an estimate of income into an opinion of value via use of an appropriate rate or factor. There are numerous capitalization techniques, and any number of income estimates may be capitalized. For example, appraisers estimate and capitalize Gross Annual Income, Effective Annual Income, Net Annual Income, Cash Flow, and After Tax Cash Flow. There are generally one or two techniques which are most appropriate for the problem at hand which can be derived from the market. Direct Capitalization. This technique utilizes a procedure whereby the net annual income estimate is divided by an overall rate. Net Annual Income. The Operating Statement on the following page demonstrates how the estimate of net annual income was developed.

15

Gross Rental Income

Potential Income 4,850 SF @ $15.00 $72,750

Food Truck $6,000

Total $78,750

Less: Vacancy @ 5% ($3,938)

Effective Gross Income $74,813Less: Expenses PSF Total

Taxes $1.32 $6,416

Insurance $0.50 $2,425

Management @ 3% $0.46 $2,244

Repairs and Maintenance $0.75 $3,638

Utilities $0.50 $2,425

Administration $0.10 $485

Reserves $0.15 $728

Total Expenses $3.79 PSF ($18,361)Net Operating Income $56,452

STABILIZED INCOME AND EXPENSE STATEMENT

The total net operating income of $56,452.00 is believed to be an appropriate Net Operating Income (NOI) to use in our Direct Capitalization Approach and is believed to represent a stabilized income stream, taking into account increasing rents and expenses. Overall Rate. The overall rate is used to convert an estimate of net annual income into an opinion of market value. This rate provides for both return on and of capital. For the purpose of this report, an overall rate of capitalization is estimated from investor surveys as well as overall rates derived from improved sales with similar use. A summary of these sales is shown on the following page.

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The sales provided indicate overall capitalization rates ranging from 6.24 to 10.04 percent, with an average of 7.89 percent. We have also considered investor expectations through a comparison of rates demanded by investors in the market. The RERC Survey (4th Quarter 2016) shows a range of 6.50 to 10.0 percent, with an average of 8.3 percent for Third-Tier neighborhood/community retail properties in the South Region. Based on the available sales data, the rates published in the Real Estate Report, and the current tenancy of the subject property, we believe an overall rate of 8.50 percent is appropriate to apply to the stabilized net operating income due to the current vacancy level in the market, typical investment criteria of real estate investors, and the location of the subject. An estimate of $56,452.00 represents the net operating income for the subject. This estimate is appropriate to use in our Direct Capitalization Approach and represents a stabilized income stream, taking into account increasing rents and expenses. The as is market value of the subject property via the Direct Capitalization is calculated below. $56,452.00 = $664,138.00 0.085

Rounded, $665,000.00

17

Sales Comparison Approach

The Sales Comparison Approach is one of the three approaches used to derive market value. It is explained in The Appraisal of Real Estate, Fourteenth Edition, by the Appraisal Institute, page 377, as follows:

“The process of deriving a value indication for the subject property by comparing similar properties that have recently sold with the property being appraised, identifying appropriate units of comparison, and making adjustments to the sale prices (or unit prices, as appropriate) of the comparable properties based on relevant, market-derived elements of comparison. The sales comparison approach may be used to value improve properties, vacant land, or land being considered as though vacant when an adequate supply of comparable sales is available.”

The comparative analysis in the Sales Comparison Approach focuses on differences in legal, physical, locational, and economic characteristics of similar properties and the subject property; on differences in the real property rights conveyed, and dates of sale, the motivations of buyers and sellers, and the financing arrangements for each sales transaction which can account for variations in pricing.

Listed on the following pages are several comparable improved sales that are believed to be similar to the subject. Following these sales is an Improved Sales Summary that summarizes the important factors of comparison that will be used in our analysis.

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Date of Purchase:

488 SMap Page:

Douglas & Mei YeeGrantor:

Lotus Rosada Investment, Inc.Grantee:

File #RP-2016-135694Recording Data:

Tract 2L-2 out of the Joel Wheaton Survey, AbstractNo. 80, Houston, Harris County, Texas

Legal Description:

SHOPPING CENTER SALE NO. 1

April 01, 2016

Name: 14244 Westheimer Road

Address: 14244 Westheimer Road, Houston, Texas 77077

Sales Price: $1,020,000.00

Sales Price Per Sq. Ft.: $154.55

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Land Size: 0.49 Acre

Cash to SellerFinancing Terms:

Broker (Nolan Nix - 713-397-4260)Data Source:

N/AComments:

Shopping Center Sale No. 1 - Continued

Net Rentable Area (Sq. Ft.): 6,600

Land-to-Building Ratio: 3.25:1

Year Built: 1978

Condition/Construction: Average/Masonry

Gross Annual Income: N/A

Stabilized Vacancy %: N/A

Effective Gross Income: N/A

Operating Expenses: N/A

Net Operating Income: $69,360.00

Overall Capitalization Rate: 6.8 Percent

E.G.I.M.: N/A

Stabilized Operating Information

Parking Area: Open

Actual Vacancy %: 0 Percent

(21,434 Sq. Ft.)

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Date of Purchase:

414 XMap Page:

PF Plaza Fiesta, LPGrantor:

Orlando Plaza, LLCGrantee:

File#2016198079Recording Data:

Reserve A, Block 1, Plaza Fiesta, Houston, HarrisCounty, Texas

Legal Description:


May 11, 2016

Name: Plaza Fiesta

Address: 3415 Orlando Street, Houston, Texas 77093

Sales Price: $1,740,000.00


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Sales ContractData Source:

This is a shopping center that is fully leased to fourtenants including a Family Dollar. This center isshadow anchored by a Fiesta.

Comments:




Year Built: 2001

Condition/Construction: Good/Metal and Masonry

Gross Annual Income: $229,911.00

Stabilized Vacancy %: <$11,496.00>

Effective Gross Income: $218,415.00

Operating Expenses: $82,706.00

Net Operating Income: $135,709.00 ($11.75 PSF)


E.G.I.M.: 7.97




(38,938 Sq. Ft.)

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Date of Purchase:

451 GMap Page:

5403 Antoine Drive, LLCGrantor:

Dexter YoonGrantee:


Reserve A7, Forest West Subdivision, Section 1,Houston, Harris County, Texas

Legal Description:


June 13, 2016

Name: Antoine Plaza

Address: 5403 Antoine Drive, Houston, TX 77091

Sales Price: $1,150,000.00


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This property included two buildings including a stripcenter and a stand alone retail building. Theproperty had a total of eight tenants. The financialinformation below reflects market vacancy andreserves for repalcement.

Comments:




Year Built: 1970 (Renovated in 2000)

Condition/Construction: Average/Masonry & Concrete Block





Net Operating Income: $92,452.00 ($11.27 per Sq. Ft.)


E.G.I.M.: N/A


Parking Area: Open/Adequate


(30,204 Sq. Ft.)

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Date of Purchase:

452 DMap Page:

TRDBY, LLCGrantor:

DAngel Eyes Investment, Inc.Grantee:

File# 2016-277581Recording Data:

Reserve "D", Block 1, One Stop Car Wash No. 4,Houston, Harris County, Texas

Legal Description:


June 28, 2016

Name: Tidwell Cleaners Shopping Center

Address: 239 W. Tidwell Road, Houston, Texas 77022

Sales Price: $800,000.00


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Seller, (213) 220-2005Data Source:

The tenants included a dry cleaning business and achurch office.

Comments:




Year Built: 2003

Condition/Construction: Good/Masonry







E.G.I.M.: N/A


Parking Area: Surface, adequate


(22,830 Sq. Ft.)

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Date of Purchase:

531 EMap Page:

Gino & Elsa CaprileGrantor:

Santa Maria Property, LLCGrantee:


Reserve "A", Block 1, Santa Marie Plaza, Houston,Harris County, Texas

Legal Description:


December 20, 2016

Name: Santa Marie Plaza

Address: 6112 Bellaire Boulevard, Houston, Texas 77081

Sales Price: $1,250,000.00


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Land Size: 1.08 Acres


BrokerData Source:

N/AComments:




Year Built: 1999 (Remodeled 2016)








E.G.I.M.: N/A




(47,045 Sq. Ft.)

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Date of Purchase:

451 QMap Page:

JHL Commercial Properties, LLCGrantor:

Summer Bay Properties, LLCGrantee:

File #2017-114522Recording Data:

Tracts 69, 69B and 69C, Block 1, EconomySuburban Gardens, Section 2 U/R, J . FlowersSurvey, Abstract 269, Harris County, Texas

Legal Description:


March 17, 2017

Name: Antoine Commercial Park

Address: 2910 Antoine Drive, Houston, Texas 77092

Sales Price: $2,100,000.00


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Land Size: 1.69 Acres


Purchase Contract Retained in Appraiser FilesData Source:

The financial information below reflects a 5 percentmarket vacancy and reserves for replacement.

Comments:




Year Built: 2003


Gross Annual Income: $194,430.00

Stabilized Vacancy %: 5.0 Percent

Effective Gross Income: $281,890.00

Operating Expenses: $91,132.00 ($4.96 per square foot)

Net Operating Income: $176,664.00 ($9.62 per square foot)


E.G.I.M.: 7.45




(73,825 Sq. Ft.)

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5/4/2017 LoopNet - 6328 Martin Luther King Blvd, Strip Center, Houston, TX

http://www.loopnet.com/xNet/MainSite/Listing/Profile/PrintProfile.aspx?LID=20117592&ShowAudit=false 1/4

Womack Development & Investment Realtors Gerald Womack — (713) 523-7402

Retail Property For Sale

Price: $537,048Gross Leasable Area: 3,920 SFPrice/SF: $137Property Type: RetailProperty Sub-type: Strip CenterProperty Use Type: Net Lease

Investment withless than 1 year leftonlease

Commission Split: 3%Tenancy: MultipleLot Size: 59,672 SFListing ID 20117592Last Updated 22 days ago

6328 Martin Luther King Blvd6328 Martin Luther King Blvd, Houston, TX 77021

Find Out More...

DescriptionGreat investment retail strip center available located off the metro rail line which runs to TheUniversity of Houston, Texas Southern University, and Downtown Houston. There are many newcommercial and residential developments in the area. With over an acre of land there are endlesspossibilities.Located right off the Metro Rail line and close to many new developments. Within 10 minutes ofThe University of Houston, Texas Southern University, and Medical Center. Easy freeway access tothe 610 loop.

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http://www.loopnet.com/xNet/MainSite/Listing/Profile/OpenContactForm.aspx?LID=20117592&PropName=6328+Martin+Luther+King+Blvd&LinkCode=31784&ShowAudit=false&PgCxtGuid=a145e820-6cb7-4600-92d9-2c223a80fb38&PgCxtFLKey=&PgCxtCurFLKey=Profile&PgCxtDir=Down



Map of 6328 Martin Luther King Blvd, Houston, TX 77021 (Harris County)

Additional Photos

6328 Martin Luther King Blvd 6328 Martin Luther King Blvd

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6328 Martin Luther King Blvd

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LOCATION MAPBorrower or Owner: Subject Address: 5808 Cullen Blvd Census Tract: 3136.00City: HoustonLender or Client: Lat: 29.7014 Long: -95.3489


File No. 170352


Sale 1: 14244 Westheimer Rd

Sale 2: 3415 Orlando St

Sale 3: 5403 Antoine Dr

Sale 4: 239 W Tidwell Rd

Sale 5: 6112 Bellaire Blvd

Sale 6: 2910 Antoine Dr

Listing: 6328 Martin Luther King Jr Blvd

0 2.5

Miles

5


N

CAUTION: The location of property arrows shown on this map are approximate only. Inaccuracies may exist on map such as missing, incorrectly drawn, or incorrectly addressed streets. Please report any such inaccuracy to MapPro, Inc. so that appropriate corrections can be made.

35

Located below is a table of the comparable improved sales used in our analysis for the subject property.

Sale Sale Size Quality of Land-To-Building Sales PriceNo. Date NRA/SF Age Condition Construction Ratio PSF

1 04/16 6,600 1978 Average Masonry 3.25:1 $154.55

2 05/16 11,550 2001 Good Metal/Masonry 3.37:1 $150.65

3 06/16 8,205 1970, 2000 Average Masonry 3.68:1 $140.16

4 06/16 6,704 2003 Good Masonry 3.41:1 $119.33

5 12/16 8,000 1999, 2016 Good Masonry 5.88:1 $156.25

6 03/17 18,360 2003 Good Masonry 4.02:1 $114.38

MIN 04/16 6,600 1970 3.25:1 $114.38

MAX 03/17 18,360 2016 5.88:1 $156.25

C.L.* N/A 3,920 1950 Average Metal 15.22:1 $137.00

Subj. N/A 4,850 1960 Average Concrete Block 2.12:1 N/A

*Denotes a Current Listing.

IMPROVED SALES SUMMARY

In order to compare these sales with the subject, comparisons were made to the sales for factors such as market conditions, size, age/condition, quality of construction, and land-to-building ratio\ The table on the following page demonstrates the required adjustments.

36

SALE 1 2 3 4 5 6PRICE/SF $154.55 $150.65 $140.16 $119.33 $156.25 $114.38MARKET CONDITIONS 0% 0% 0% 0% 0% 0%

TOTAL ADJUSTMENTS 0% 0% 0% 0% 0% 0%

ADJUSTED PRICE / SF $154.55 $150.65 $140.16 $119.33 $156.25 $114.38

LOCATION -10% -10% 0% 0% 0% 0%

SIZE 0% 5% 0% 0% 0% 10%

AGE/CONDITION 0% -5% 0% -5% -5% -5%

QUALITY OF CONSTR. 0% 0% 0% 0% 0% 0%

LAND-TO-BUILDING RATIO 0% 0% 0% 0% -5% 0%

NET ADJUSTMENTS -10% -10% 0% -5% -10% 5%

FINAL ADJUSTED RATE/SF $139.10 $135.59 $140.16 $113.36 $140.63 $120.10MINIMUM $113.36MAXIMUM $140.63MEDIAN $137.34MEAN $131.49CONCLUDED VALUE / SF $135.00

SIZE (SF) 4,850 INDICATED VALUE $654,750ROUNDED $655,000

IMPROVED SALES ADJUSTMENT GRID

The sales believed to be the most comparable to the subject have an adjusted sales price range of $114.38 to $140.63 per square foot, with an average of $131.49 per square foot and a median of $137.34 per square foot. We have also included a current listing with a list price of $137.00 per square foot. After considering all of the factors that influence value, it is our opinion that the subject property has a value of $135.00 per square foot, or as follows:

Value of Subject Property via Sales Comparison Approach Building Area X Value per Sq. Ft. = Indicated Value

4,850 SF @ $135.00 PSF = $654,750.00 Rounded to, $655,000.00

37

Final Market Value. Although two approaches to value were utilized, the final opinion of value must be based upon that confirmation of the available market data and analysis which is most appropriate. In this instance, both the Sales Comparison Approach and Income Capitalization Approach were given the equal weight. Thus, the final value for the subject is as follows: subject as is. Based on this analysis and after further consideration, it is our opinion that the indicated market value, is shown below:

As Is Market Value (May 1, 2017)

$660,000.00

STRENGTHS AND WEAKNESSES (SWOT ANALYSIS) Strengths

• Proximity to University of Houston • High traffic count along Old Spanish Trail which is located in proximity to • 100 Percent occupied

Weaknesses

• Regional economy is heavily dependent upon the Oil and Gas industry • Lack of renovations on the improvements.

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MARKETING/EXPOSURE TIME

Assuming adequate exposure and normal marketing efforts, the estimated exposure time (i.e., the length of time he proposed subject property would have been exposed for sale in the market had it sold at the market value concluded to in this analysis as of the date of this valuation) would have been within 12 months; the estimated marketing time (i.e. the amount of time it would probably take to sell the subject property if exposed in the market beginning on the date of this valuation) is estimated to be within about 12 months. Based on our analysis of the real estate market and discussions with brokers and other knowledgeable individuals in this industry, we believe a reasonable period of time to market the subject property at the previously derived market value is approximately 12 months. This opinion of value is subject to the Assumptions and Limiting Conditions which are included in the attached report. To the best of our understanding, this report conforms to the requirements of Title XI of the Federal Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA) and the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation and the Appraisal Institute. Respectfully submitted,

The Ambrose Group

________________________________ _______________________________ David M. Ambrose, MAI Brian A. Burk, MAI, SRA, AI-GRS State Certified General RE Appraiser State Certified General RE Appraiser Certificate No. TX-1322613-G Certificate No. TX-1334810-G _______________________________ Kyle D. Ambrose State Certified General RE Appraiser Certificate No. TX- 1380694-G

39

CERTIFICATION

We certify that, to the best of our knowledge and belief…

• The statements of the facts contained in this report are true and correct.

• The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions.

• We have no present or prospective interest in the property that is the subject of this report or to the parties involved with this assignment. Furthermore, neither The Ambrose Group (formerly known as Ambrose Appraisal Company) nor the appraisers who have signed this report, have performed any services regarding the subject property within the three-year period immediately preceding acceptance of the assignment, as an appraiser or any other capacity.

• We have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.

• Our engagement in this assignment was not contingent upon developing

or reporting predetermined results.

• Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.

• Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.

• Kyle D. Ambrose viewed the property, which is the subject of this report. It should be noted, David M. Ambrose and Brian A. Burk did not perform a physical site visit to the property.

• No one provided significant real property assistance to the state certified

appraisers signing this report.

• The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

40

• The appraisal assignment was not based on a requested minimum valuation, a specific valuation, or the approval of a loan.

• As of the date of this report, David M. Ambrose and Brian A. Burk have

completed the requirements of the continuing education program for Designated Members of the Appraisal Institute.

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

Based upon our research and analysis of the market, which is provided in the accompanying report, the indicated value of the subject property, as of May 1, 2017, is as follows:

As Is Market Value

$660,000.00

________________________________ _______________________________ David M. Ambrose, MAI Brian A. Burk, MAI, SRA, AI-GRS State Certified General RE Appraiser State Certified General RE Appraiser Certificate No. TX-1322613-G Certificate No. TX-1334810-G _______________________________ Kyle D. Ambrose State Certified General RE Appraiser Certificate No. TX- 1380694-G

41

ASSUMPTIONS AND LIMITING CONDITIONS

That the date of value to which the opinions expressed in this report apply is set forth in the Letter of Transmittal. The appraiser assumes no responsibility for economic or physical factors occurring at some later date that may affect the opinions herein stated. That no opinions are intended to be expressed for legal matters or that would require specialized investigation or knowledge beyond that ordinarily employed by the real estate appraisers, although such matters may be discussed in this report. That no opinion are intended to be expressed for legal matters or that would require specialized investigation or knowledge beyond that ordinarily employed by real estate appraisers, although such matters may be discussed in this report. That no opinion as to title is rendered. Name of ownership and the legal description were obtained from sources generally considered reliable. Title is assumed to be marketable and free and clear of all liens, encumbrances, easements, and restrictions except those specifically discussed in this report. The property is appraised assuming it to be under responsible ownership and competent management and available for its highest and best use. That no engineering survey has been made by the appraiser. Except as specifically stated, data relative to size and area were taken from sources considered reliable and no encroachment or real property improvement is assumed to exist. That maps, plats, and exhibits included herein for illustration only, as an aid in visualizing matters discussed within this report. They should not be considered as surveys or relied upon for any other purpose. That no detailed soil studies covering the subject property were available to the appraiser. Therefore, premises as to soil qualities employed in this report are not conclusive, but have been considered consistent with information available to the appraiser. The property is appraised as though free and clear, under responsible ownership, and competent management. All existing liens and encumbrances have been disregarded. Unless stated otherwise in this report, no presence of hazardous materials on or in the property was observed by the appraiser. The appraisers have no information on the existence of such materials and is not qualified to detect same. The presence of such. However, the value stated herein is based on the assumption that no hazardous materials are present on or in the property, and the appraisers accept no responsibility for determining such condition. The client is urged to retain an expert in this field if there is any question as to the existence of hazardous material.

42

Any information furnished to us by others is believed to be reliable, but we assume no responsibility for its accuracy. Possession of this report, or a copy thereof, does not carry with it the right to publication, nor may it be used for any purpose, by anyone other the applicant, without the previous written consent of the appraisers or the applicant and, in any event, only in its entirety. This appraisal does not require us to give testimony in court or attend on its behalf unless arrangements have been previously made therefore. The distribution of the total valuation in this report between land and improvements applies only under the reported highest and best use of the property. The allocations of value for land and improvements must not be used in conjunction with any other appraisal and are invalid if so used. The appraisal report shall be considered only in its entirety. No part of the appraisal report shall be utilized separately or out of context. The value is reported in dollars on the basis of the currency prevailing at the date of this appraisal. We have no present or contemplated interest in the property appraised. Furthermore, our compensation for making this appraisal is in no manner contingent upon the value reported. That the appraiser assumes no responsibility for determining if the property lies within a flood hazard area and its consequences to the property. It is advised that a Topographic Survey be obtained and local officials be contacted. This appraisal has been made in accordance with the Code of Professional Ethics of the Appraisal Institute and the Uniform Standards of Professional Appraisal Practice of the Appraisal Institute. In addition, to the best of our understanding, this report conforms to the requirements of Title XI of the Federal Financial Institutions Reform, Recovery and Enforcement Act of 1898 (FIRREA) and the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation and the Appraisal Institute. The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific compliance survey and analysis of this property to determine whether or not it is in conformity with the various detailed requirements of the ADA. It is possible that a compliance survey of the property, together with a detailed analysis of the requirements of the ADA, could reveal that the property is not in compliance with one or more requirements to the act. If so, this fact could have a negative impact upon the value of the property. However, since we have no direct evidence relating to the issue of compliance, we did not consider possible noncompliance with the requirements of ADA in determining the value of the property.

43

The land area was obtained from the Harris County Appraisal Department. The appraisers used the rent roll provided by the owner to obtain suite sizes and overall net rentable areas. If it is found that these sizes and lease terms are inaccurate or unreliable, the appraisers reserve the right to amend this report. It is assumed that this information is accurate and has been utilized within this analysis. However, should more detailed land or building area figures become available at a later date, the appraiser reserve the right to amend the contents of this report (upon just compensation). We were not provided with Profit & Loss Statements for the subject property. In addition, we were provided with limited rental information. In the event more detailed information is provided which contradicts this report, we reserve the right to amend this report. The appraisal represents a restricted report format. Much of the supporting documentation has been retained in our files. The use of any extraordinary assumptions or hypothetical conditions may impact the market value determined within this report. There are no other limiting conditions contained in this report other than the ones listed above

44

.................................................

Subject

Subject

Subject

Subject

Subject

Subject

Subject

Subject

Subject

Yellowstone ParkYellowstone ParkYellowstone ParkYellowstone ParkYellowstone ParkYellowstone ParkYellowstone ParkYellowstone ParkYellowstone Park

MacGregor ParkwayMacGregor ParkwayMacGregor ParkwayMacGregor ParkwayMacGregor ParkwayMacGregor ParkwayMacGregor ParkwayMacGregor ParkwayMacGregor Parkway

ullen Middle Schoolullen Middle Schoolullen Middle Schoolullen Middle Schoolullen Middle Schoolullen Middle Schoolullen Middle Schoolullen Middle Schoolullen Middle School

Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary Hartsfield Elementary SchoolSchoolSchoolSchoolSchoolSchoolSchoolSchoolSchool

MacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingMacGregor Plaza ShoppingCenterCenterCenterCenterCenterCenterCenterCenterCenter

MacGregor ParkMacGregor ParkMacGregor ParkMacGregor ParkMacGregor ParkMacGregor ParkMacGregor ParkMacGregor ParkMacGregor Park

entary entary entary mentary mentary mentary mentary mentary mentary lll

ood Parkood Parkood Parkwood Parkwood Parkwood Parkwood Parkwood Parkwood Park

Peck Elementary SchPeck Elementary SchPeck Elementary SchPeck Elementary SchPeck Elementary SchPeck Elementary SchPeck Elementary SchPeck Elementary SchPeck Elementary Sch

Elementary Elementary Elementary Elementary Elementary Elementary Elementary Elementary Elementary hoolhoolhoolhoolhoolhoolhoolhoolhool

Balkin St

Wheeler Ave

Faulkner St

Southridg

University Dr

Beek

man

Rd

Yellowstone Blvd

Kelso St

Griggs

Yellowstone Blvd

Cul

len

Blvd

Old Spanish Trl

I-610 EI-610 E

La S

alet

te S

t

US-90 Alt E

Nas

sau

Rd

Sher

woo

d D

r

Wes

ton

St

Scot

t St

Southu

Kuhlman

ephyr St

Cul

le

Kingsbury St

Perry St

Beekm

an R

d

Wheeler St

S Loop Service Rd E

Scot

t St

Scott St

Griggs Rd

Fost

er S

t

Kass

arin

e Pa

ss

Griggs Rd

Dreyfus St

Old Spanish Trl

Alice St

Scot

t St

Sidn

ey S

t

Cosby St

Sher

woo

d D

r Yellowstone Blvd

Arbor St

Roseneath Dr

Griggs Rd

Yellowstone Blvd

Enyart St

Kingsbury St

Mila

rt St

Charleston St

Roseneath Dr

Ward St

Blodgett St

Palm St

Oas

is P

alm

Arbor St

Scot

t St

Old Spanish Trl

Zephyr St Mar

tin L

uthe

r Kin

g Jr

Blv

d

Idaho St

Enyart St Enyart St

Varsity Ln

Idaho St

I-610 E

Tier

wes

ter S

t

Gra

ce L

n

Wheeler Ave

South Loop E

Fiesta Ln

Cosby St

Scottcrest Dr

Southmore Ave

Way

land

Dr

Perry St

Griggs Rd

Scot

t St

Old Spanish Trl

Idaho St

Alb

Balkin St

Gren St

N MacGregor Way

Cal

houn

Rd

Sidn

ey S

t

Scot

t St

Yellowstone BlvdWard St

Zephyr St

Blodgett St

Scot

t St

Dewberry St

Wes

ton

St

Hull St

e St

Engl

and

St

Scot

t St Branch St

Browncroft St

Keystone St

Dewberry St

Wentworth Ln

Blvd

Cherbo

Hull St

Perry St

Gammage St

Cal

houn

Rd

Griggs Rd

Winnetka Ave

nn Ct

MacGregor Loop DrRio Vista St

Susan Ann Ct

Winfree Dr

Oakcrest Dr

Cul

len

Blvd

Alsace St

Ward St

Faulkner St

Wheeler Ave

Kelso St

Hon

ey C

irC

ulle

n Bl

vd

Harvest Ln

Malmedy Rd

Mila

rt St

Winfree Dr

Cosby St

S Loop Fwy

Scot

tcre

st D

r

Idaho St

Burk

ett S

t

La S

alet

te S

t

Blodgett St

N MacGregor Way

t

Arbor St

ott S

t

Radial St

Griggs Rd

Hull St

Florinda St

Michael P Williams Plz

Southlea St

Marietta Ln

Southmon

Tristan St

Mila

rt St

Sher

woo

d D

r

Sain

t Aug

ustin

e St

Grace Ln

Browncroft St

Stuyve

Scot

t St MacG

regor Loop Dr

te Highw

ay 35

Luca St

Hull St

Can

field

St

Palm St

South Loop E

Engl

and

St

State Highw

ay 35

Eppes St

Charleston St

Cul

len

Blvd

TX-5 Spur

taan Rd

Sidn

ey S

t

Burk

ett S

t

S MacGregor Way

Hull St Hull St

Kelso St

Old Spa

Engl

and

St

Southcr

St

Con

ley

StAve

Martin Luther King Jr Blvd

Albemarle Ln

Old Spanish Trl

Co

Blythewood St

Scot

t St

Sain

t Aug

ustin

e St

Scot

t St

Cal

houn

Rd

Con

ley

St

Arvilla Ln

Lond

on S

t

Gra

ce L

n

Scot

t St

Alsace St

Cosby St

Madalyn Ln

I-610 W

La S

alet

te S

t

Scot

t St

Rio Vista St

Cullen Blvd

Porter StPorter St

Alberta St

Fernwood Dr

Keystone St

Fiesta Ln

Southl

Marietta Ln

Graduate CirSi

dney

St

S MacGregor Way

Perry St

Bataan Rd

y St

Hull St

I-610 W

La S

alet

te S

t

Mila

rt St

Balkin St

Con

ley

St

Mad

rid S

t

Hull St

Wichita Ave

Marietta Ln

South Loop E

Florinda St

Perry St

Dewberry St

Cal

houn

Rd

Tier

wes

ter S

t

Wes

ton

St

Cosby St

Swan

k St

St Blyt

hewo

od S

t

Mila

rt St

Alice St

Luca St

Kingsbury St

Ditmas

St

Tristan St

Fernwood Ct

South Lo

Fernwood Dr

Kingsbury St

St

Corder St

Dreyfus St

Arbor St

Griggs Rd

TX-5 Spur

Corder St

Gof

orth

St

Prospect AveBinz Ave

Porter St

East

woo

d St

Ward St

TX-5 Spur

Cosby St

Cul

len

Blvd

N MacGregor Way N MacGregor Way

Alice St

Balkin St

Kuhl

man

Gra

ce L

n

St

Kelso StAlice St

Faculty Ln

US-90 Alt W

Ward St

Oakdale St

Ward St

Lond

on S

t

Daphne St

Dixie Dr

Ruth St

Cosby St

Cosby St

Con

ley

St

Winnetka Ave

Uni

vers

ity O

aks

Blvd

N Roseneath Dr

Jth Loop E

ct Ave

Alberta St

South Loop E

Hull St

TX-5 Spur

Leop

old

Dr

r St

Eppes St

Dreyfus St

Laurel Dr

Burk

ett S

t

Penf

Arvilla Ln

Mad

rid S

t Cosby St

Live

rpoo

l St

Wichita Ave

Wichita Ave

erta St

acGregor Way

Cosby St

Via Genoa Ct

Sidn

ey S

t

Palm St

Ros

edal

e C

ir

Enyart St

urkett S

t

Paris

St

Odin C

t

Gof

orth

St

Branch St

Blyt

hew

ood

StGriggs Rd

Balkin St

Sco

tt S t

Cosby St

Malmedy Rd

Dixie Dr

Idaho St

Dewberry St

Cal

houn

Rd

Charleston St

Alsace St

Cul

len

Blvd

Paris

St

Perry St

Southmore Ave

Mila

rt St

Southmore Ave

Dum

ble

St

New

Yor

k St

Rosedale St

hne St

Gof

orth

St

Wheeler Ave

Ward St

t

Con

ley

St

Griggs Rd

e St

os St

Gertin St

Fost

er S

t

N Roseneath Dr

Ventura Ln

one Blvd

Con

ley

St

Cosby St

Cosby St

Bel

vede

re S

t

Wichita Ave

Ne

Sain

t Aug

ustin

e St

909090909090909090

FLOOD MAPBorrower or Owner: Subject Address: 5808 Cullen Blvd Census Tract: 3136.00City: HoustonLender or Client: Lat: 29.701439 Long: -95.348912


File No. 170352


0 0.2

Miles

0.4


N

Flood Zone Information

FEMA Map No. 48201C0880M

FEMA Zone X

Effective Date 01/06/2017

100-Year

100-Year Floodway

500-Year

Outside 500-Year

CAUTION: The location of flood hazard areas shown on this map are approximate only. Flood hazard boundaries may change from time to time. A property in the generalvicinity of a flood hazard area should be evaluated by a civil engineer or other appropriate specialist prior to purchase or investment.

45

PLA

T M

AP

46

AER

IAL

MA

P

47

VIEW OF SUBJECT ALONG CULLEN BOULEVARD LOOKING SOUTHWEST

VIEW OF SUBJECT ALONG CULLEN BOULEVARD LOOKING NORTHEAST

48

EXTERIOR VIEW OF BUILDING


49

INTERIOR VIEW OF BUILDING


50



51



52

4Q 2016 | Volume 45 | No. 4

SitusRERC.com Situs.com © 2017 RERC LLC. All rights reserved.44

REAL ESTATE REPORT

Regional Investment Criteria - 4Q 2016 | Third-Tier1 Investment Properties

Office Industrial Retail

Apartment Student Housing Hotel

CBD Suburban Warehouse R&D Flex Regional Mall

Power Center

Neigh/Comm

West Investment Criteria

Pre-tax Yield (IRR) (%)

Range 7.3 - 12.0 7.5 - 12.0 6.5 - 11.0 7.8 - 12.0 7.8 - 11.5 7.5 - 12.0 7.8 - 12.0 7.0 - 11.0 7.0 - 12.0 7.5 - 11.0 9.0 - 13.5

Average 9.5 9.6 8.9 9.6 9.5 9.3 9.5 9.3 8.7 9.3 11.1

Going-In Cap Rate (%)

Range 5.8 - 9.0 6.0 - 9.3 5.5 - 9.5 5.5 - 9.5 5.5 - 9.5 6.0 - 9.0 6.0 - 9.0 5.0 - 9.0 4.5 - 8.8 5.5 - 8.5 7.0 - 11.0

Average 7.3 7.6 7.2 7.5 7.5 7.3 7.7 7.3 6.2 6.8 8.7

Terminal Cap Rate (%)

Range 6.0 - 11.0 6.5 - 11.0 6.5 - 9.8 7.0 - 10.0 6.5 - 10.0 6.0 - 10.0 6.0 - 10.0 7.0 - 9.5 5.5 - 9.0 6.0 - 9.5 7.0 - 11.5

Average 8.2 8.5 8.0 8.3 8.3 8.0 8.3 7.9 7.0 7.4 9.3

Midwest Investment Criteria


Range 9.0 - 13.0 9.0 - 12.0 9.0 - 13.0 6.5 - 11.5 9.0 - 13.0 6.0 - 11.0 6.0 - 11.0 6.0 - 11.3 7.3 - 12.0 8.8 - 11.3 10.0 - 13.0

Average 10.5 10.6 10.3 10.3 10.7 9.5 10.0 10.1 9.6 9.6 11.1


Range 7.0 - 10.1 6.8 - 10.2 6.5 - 10.1 7.0 - 12.1 7.0 - 10.5 7.3 - 12.0 6.5 - 10.3 7.0 - 12.1 6.0 - 11.0 6.8 - 9.0 7.0 - 12.1

Average 8.8 8.8 8.7 9.3 9.2 9.3 8.9 9.1 8.1 7.9 9.8


Range 7.5 - 12.1 7.5 - 12.1 7.5 - 12.1 7.5 - 11.8 7.5 - 12.1 7.0 - 12.3 7.0 - 11.0 7.5 - 10.8 5.5 - 11.0 7.3 - 12.1 9.3 - 12.0

Average 9.5 9.6 9.3 9.8 9.8 9.6 9.5 9.6 8.6 8.8 10.6

South Investment Criteria


Range 8.0 - 12.0 8.0 - 11.5 8.0 - 12.0 8.5 - 12.5 8.5 - 12.5 8.5 - 14.0 9.0 - 12.0 7.5 - 11.5 7.0 - 10.5 8.0 - 11.0 8.5 - 13.0

Average 9.9 10.2 10.0 10.4 10.4 10.3 10.1 9.8 8.8 9.1 10.5


Range 5.0 - 9.5 5.0 - 10.0 6.0 - 10.0 7.3 - 9.8 6.5 - 9.8 7.0 - 11.0 5.0 - 9.5 6.5 - 10.0 5.8 - 9.5 7.3 - 10.0 7.0 - 10.0

Average 8.2 8.6 8.3 8.8 8.7 8.5 8.3 8.3 7.4 8.0 9.0


Range 6.0 - 10.5 6.8 - 12.0 6.3 - 10.5 7.5 - 10.8 7.5 - 10.5 7.5 - 10.0 6.0 - 11.0 6.8 - 11.0 6.0 - 10.0 6.0 - 10.5 7.5 - 11.0

Average 8.8 9.5 8.9 9.3 9.4 8.9 9.0 9.0 7.8 8.2 9.6

East Investment Criteria


Range 8.0 - 13.0 8.5 - 13.0 7.5 - 12.0 7.3 - 12.0 8.0 - 13.0 8.0 - 13.0 8.5 - 13.0 8.5 - 12.5 6.8 - 12.0 8.5 - 14.0 10.0 - 15.0

Average 10.3 10.5 9.9 10.1 10.3 10.2 10.4 10.3 9.4 9.8 11.8


Range 5.5 - 10.5 6.0 - 11.0 6.0 - 11.0 6.5 - 11.5 7.0 - 12.0 7.0 - 12.0 6.0 - 11.0 6.0 - 11.0 5.0 - 10.5 6.3 - 12.0 7.0 - 12.0

Average 8.1 8.7 8.4 8.7 8.7 8.9 8.6 8.4 7.5 8.5 9.7


Range 6.0 - 11.0 6.5 - 11.5 6.8 - 12.0 7.0 - 12.0 7.0 - 12.0 7.0 - 12.0 7.0 - 12.0 7.5 - 12.0 5.8 - 11.0 7.0 - 12.0 9.0 - 12.5

Average 8.8 9.5 9.2 9.4 9.4 9.6 9.2 9.5 8.3 8.8 10.7

1 Third-tier investment properties are defined as older properties with functional inadequacies and/or marginal locations. A list of Situs RERC Defined Regions is located in the back of this report in the “Scope and Methodology” section.

53

Friday,May5,2017at10:45:05AMCentralDaylightTime

Page1of2

Subject: FW:AppraisalOrderDate: Thursday,March30,2017at4:17:14PMCentralDaylightTimeFrom: BrianBurkTo: KyleAmbrose,DianeOuzts

GivetoKyleandIwillreview.ThanksSincerely, Brian Burk, MAI, SRA, AI-GRSDirector of Appraisal Services

Office: (713)688-7733 | Direct: (832)300-1721www.theambrosegroup.net From: James Hamon Sent: Thursday, March 30, 2017 1:25 PMTo: Brian BurkSubject: FW: Appraisal OrderNew Order from Justin Carpenter. Best regards, James HamonReal Estate Consultant/Appraiser

Office: (713) 688-7733 | Direct: (832) 300-1713 | Cell: (832) 928-8736www.theambrosegroup.net From:ValLongoria[mailto:[email protected]]Sent:Thursday,March30,20171:09PMTo:JamesHamon<[email protected]>Subject:AppraisalOrderHelloJames,Pleaseacceptthisemailasanappraisalorder.ThelenderwillbeJordanproperYesorSeguro,whicheverJusYnCarpentersdecides.SubjectProperty5808CullenBlvd.Houston,TX77021Selleris:SandraN.FalconerBuyeris:RemusColinNembhard

54

http://www.theambrosegroup.net/

http://www.theambrosegroup.net/

mailto:[email protected]

mailto:[email protected]

of2

LoanAmount:$450,000Pleasecontactthesellerforentryandforpaymentoftheorder,sheisusuallyonsiteofthesubjectproperty:SandraFalconer:713-373-7082ValLongoriaOakValleyCommercialLendingHouston,TXOffice:877-755-8244Fax:281-754-4692www.ovclending.com

55

http://www.ovclending.com/

QUALIFICATIONS OF KYLE D. AMBROSE Kyle D. Ambrose is an Certified General Real Estate Appraiser with The Ambrose Group, Appraisal Division, which has offices in Houston and Dallas, Texas. Mr. Ambrose has experience in the valuation of multiple property types including retail, office, multi-family residential, industrial, religious establishments, tax exempt properties, and various other commercial property types.

BIOGRAPHICAL DATA

Mr. Ambrose was born in Houston, Texas in 1991. He graduated from Windfern High School, prior to attending Baylor University.

EDUCATION Bachelor of Business Administration (Real Estate)

Baylor University (2013)

MISCELLANEOUS Certified General Real Estate Appraiser Authorization #: TX 1380694 G

56

Douglas E. OldmixonCommissioner

Texas Appraiser Licensing and Certification BoardTexas Appraiser Licensing and Certification BoardTexas Appraiser Licensing and Certification BoardTexas Appraiser Licensing and Certification BoardP.O. Box 12188 Austin, Texas 78711-2188

Certified General Real Estate Appraiser

Having provided satisfactory evidence of the qualifications required by theTexas Appraiser Licensing and Certification Act, Texas Occupations Code,Chapter 1103, is authorized to use this title, Certified General Real EstateAppraiser.

Number:Issued:

1380694

Expires: 03/31/2019

KYLE DAVID AMBROSE17627 GLORY ROSE CTCYPRESS, TX 77429

Appraiser:

03/15/2017

KYLE DAVID AMBROSE

TX G

You may wish to laminate the pocket identification card to preserve it.

Inquiry as to the status of this license may be made to:

Texas Appraiser Licensing and Certification BoardP.O. Box 12188

Austin, Tx 78711-2188www.talcb.texas.gov

(512) 936-3001Fax:(512) 936-3899


The person named on the reverse is licensed by the Texas Appraiser Licensing and Certification Board.



Having provided satisfactory evidence of the qualifications required by the Texas Appraiser Licensing and Certification Act, Texas OccupationsCode, Chapter 1103, is authorized to use this title, Certified General Real Estate Appraiser.

Number#:

Issued: Expires:

1380694

03/31/2019

Appraiser:

03/15/2017

KYLE DAVID AMBROSE

TX G

57

BRIAN A. BURK, MAI, SRA, AI-GRS (713) 410-4347

[email protected]

EDUCATION Baylor University, Bachelor of Business Administration in Real Estate and Finance REAL ESTATE EDUCATION Appraisal Institute of Real Estate Appraisers Cool Tools: New Technology for Real Estate Appraisers Analyzing Operating Expenses Appraising Convenience Stores

Review Theory – General Forecasting Revenue Fundamentals of Separating Real Property, Personal Property, and Intangible Assets 7-Hour National USPAP Update Course Condemnation Appraising: Principles & Applications Feasibility, Market Value, Investment Timing: Option Value Small Hotel/Motel Valuation Understanding and Testing DCF Valuation Models Spotlight on USPAP: Hypothetical Conditions and Extraordinary Attacking and Defending an Appraisal in Litigation Advanced applications Report Writing and Valuation Analysis Advanced Sales Comparison and Cost Approaches Advanced Income Capitalization Highest and Best Use and Market Analysis 15-Hour National USPAP Course Appraisal Principles General Applications Business Practices and Ethics Basic Income Capitalization Appraisal Procedures CCIM Institute CI 101: Financial Analysis for Commercial Investment Real Estate Challenge EMPLOYMENT HISTORY

2013 – Present: Director of Appraisal Services; The Ambrose Group, Houston, Texas 2010 – 2013: Senior Consultant; Keystone Consulting Group, Raleigh, North Carolina 2002 – 2010: Senior Appraiser; Ambrose Appraisal Company, Houston, Texas 1999 – 2002: Credit Analyst; Extraco Banks, Waco, Texas

58

Brian A. Burk, MAI, SRA, AI-GRS Page Two LICENSES

State of Texas – Certified General Appraiser No. TX-1334810-G State of Louisiana – Certified General Appraiser No. G3790 State of Oklahoma – Certified General Appraiser No. 13079CGA

DESIGINATIONS

MAI – Appraisal Institute (Awarded in August 2009) AI-GRS – Appraisal Institute (Awarded in September 2014) SRA – Appraisal Institute (Awarded in October 2014)

PROFESSIONAL AFFILIATIONS Appraisal Institute Member No. 442901 CCIM Institute

EXPERIENCE Assignments undertaken have included appraisals, appraisal reviews, market studies, land utilization and project planning of virtually all types of commercial and residential real estate. Primary areas of specialty, in order of preference, include: shopping centers, regional malls, lodging facilities, office properties, apartments, industrial properties, mixed-use developments, subdivisions, and vacant land.

COURT EXPERIENCE Testified as an expert witness in bankruptcy court in Wake County, North Carolina.

59





Number:Issued:

1334810

Expires: 04/30/2019

BRIAN ALAN BURK16545 VILLAGE DRIVE BLDG AJERSEY VILLAGE, TX 77040

Appraiser:

04/07/2017

BRIAN ALAN BURK

TX G





(512) 936-3001Fax:(512) 936-3899






Number#:

Issued: Expires:

1334810

04/30/2019

Appraiser:

04/07/2017

BRIAN ALAN BURK

TX G

60

QUALIFICATIONS OF DAVID M. AMBROSE, MAI

David M. Ambrose is the president of The Ambrose Appraisal Company which has officesin Houston and Dallas, Texas. Mr. Ambrose received the MAI designation in 3 years fromentering the profession. He holds a MBA Degree from Baylor University. Mr. Ambrose'sexperience includes the valuation of all types of commercial and residential properties. Hehas testified as an expert witness regarding property value on numerous occasions invarious courts of law.

BIOGRAPHICAL DATA

Mr. Ambrose was born in San Antonio, Texas in 1964. He graduated from the publicschools in San Antonio, Texas prior to attending Baylor University. While attending BaylorUniversity, Mr. Ambrose received the Jim Weatherby Scholarship for Academic Excellence. Mr. Ambrose is married and has five children.

EDUCATION

Bachelor of Business Administration Degree (Finance/Real Estate): Baylor University (1986)Masters of Business Administration: Baylor University (1988) Appraisal Institute: Numerous Appraisal Seminars, Courses, Lectures, etc.

PROFESSIONAL AFFILIATIONS

Appraisal Institute (MAI No. 9041)State Certified General Real Estate Appraiser-Certificate No. TX-1322613-GTexas Real Estate Commission (Broker)-License No. 0382964

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Number:Issued:

1322613

Expires: 02/28/2018

DAVID MICHAEL AMBROSE16545 VILLAGE DR BLDG AHOUSTON, TX 77040

Appraiser:

01/07/2016

DAVID MICHAEL AMBROSE

TX G





(512) 936-3001Fax:(512) 936-3899






Number#:

Issued: Expires:

1322613

02/28/2018

Appraiser:

01/07/2016

DAVID MICHAEL AMBROSE

TX G

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may 5, 2017 - loopnet...may 1, 2017. the date of this appraisal report is may 5, 2017. property tax....

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