Walnut Apartments. 807,809,811 W Walnut Celina, TX 75009

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1 Rapid Growth Area Limited Apartment Inventory Great Schools/Strong Sports Programs = Big Draw Solid Income Property 8.31 CAP Rate & 9+% Cash on Cash Presented by mnteds@aol.com Dallas Income Properties, LLC 819 N. Bishop Dallas, TX 75208

Dallas Income Properties, LLC Income, Expenses & Cash Flow Property Overview Potential Rental Income $ 116,100 Purchase/Asking Price $ 930,000 Property Type Apartments Other Income - Improvements -

$ 87 Net Operating Income (NOI) $ 77,293 Income per Unit $ 9,675 MIP Payments $ Total Acquisition Cost $ 930,000 Expenses per Unit $ (2,750) Annual Reserves: $ Debt Service: $ (55,238) Cash Flow

2 Dallas Income Properties, LLC Income, Expenses & Cash Flow Property Overview Potential Rental Income $ 116,100 Purchase/Asking Price $ 930,000 Property Type Apartments Other Income - Improvements - No. of Units 12 Total Vacancy and Credits (5,805) Other - Price Per Unit $ 77,500 Operating Expenses $ (33,002) Closing Costs - Total Sq Ft 10,656 Annual Reserves: $ Finance Points - Price Per Sq Ft $ 87 Net Operating Income (NOI) $ 77,293 Income per Unit $ 9,675 MIP Payments $ Total Acquisition Cost $ 930,000 Expenses per Unit $ (2,750) Annual Reserves: $ Debt Service: $ (55,238) Cash Flow Before Taxes $ 22,055 Mortgage (s) $ 697,500 Income Taxes: Benefit 0% (6,531) Down Payment / Investment $ 232,500 Cash Flow After Taxes $ 15,524 Assumptions Loan Information % of Asking % of Cost Rental Growth Rate: 2.00% Down Payment: $ 232, % 25.00% Expense Growth Rate: 1.00% Initial Loan Balance: $ 697, % 75.00% Capitalization Rate (Resale): 8.00% Marginal Tax Rate: 0.00% Loan Amount Interest Rate Term Payment Capital Gain Tax Rate: 0.00% $ 697, % 20 $4,603 $ 6.50% 20 $0 $ 3.00% 30 $0 Financial Measurements Year 1 Year 3 Year 7 Notes / Discussion Debt Coverage Ratio (DCR) Loan-to-Value Ratio (LVR) 70.0% 62.5% 47.6% Capitalization Rate Based on Cost 8.31% 8.70% 9.53% Capitalization Rate Based on Resale Price 8.00% 8.00% 8.00% Gross Rent Multiplier Net Present Value (NPV) - B/ Taxes Net Present Value (NPV) - A/Taxes 13.50% (9,078) 41,238 95, % (8,094) 46, ,525 Cash on Cash Return - Before Taxes 9.49% 11.05% 14.37% Cash on Cash Return - After Taxes 6.68% 7.99% 9.50% Internal Rate of Return - Before Taxes 20.36% 20.53% Internal Rate of Return - After Taxes 17.36% 17.73% Modified Internal Rate of Return - Before Taxes Modified Internal Rate of Return - After Taxes 19.09% 17.63% 16.58% 15.86% Property was completely renovated in New tubs & toilets in 11 of 12 units, ceramic tile installed in all bathrooms & kitchens. Ceramic tile or laminated plank in living and bedrooms. Carpet on stairs and upstairs landing. Apartments were repainted on both interior/exterior. New counter tops & refinish cabinets. HVAC units were replaced asneeded. Units are studio style apartments with all bedrooms upstairs and livingroomsaredown. Front& rear access. Disclaimer: All information presented is believed to be accurate. The information, calculations and data presented in this report are believed to be accurate but are not guaranteed. The information contained in this report shall not be considered as a substitution for legal, accounting or other professional advice. Please seek proper legal and tax advice as appropriate before making investments.

3 Rental Activity Analysis Year 1 Year 2 Year 3 Year 4 Year 5 Potential Rental Income $ 116,100 $ 118,422 $ 120,790 $ 123,206 $ 125,670 Less: Vacancy & Credit Losses (5,805) (5,921) (6,040) (6,160) (6,284) Effective Gross Income $ 110,295 $ 112,501 $ 114,751 $ 117,046 $ 119,387 Less: Operating Expenses (33,002) (33,413) (33,830) (34,253) (34,682) Net Operating Income (NOI) $ 77,293 $ 79,088 $ 80,921 $ 82,793 $ 84,705 Less: Annual Debt Service (55,238) (55,238) (55,238) (55,238) (55,238) CASH FLOW Before Taxes $ 22,055 $ 23,849 $ 25,682 $ 27,554 $ 29,467 Property Resale Analysis Projected Sales Price $ 966,163 $ 988,595 $ 1,011,507 $ 1,034,910 $ 1,058,811 Less: Selling Expenses (57,970) (59,316) (60,690) (62,095) (63,529) Adjusted Projected Sales Price $ 908,193 $ 929,279 $ 950,817 $ 972,815 $ 995,283 Less: Mortgage(s) Balance Payoff (676,664) (654,761) (631,738) (607,537) (582,098) SALE PROCEEDS Before Taxes $ 231,529 $ 274,518 $ 319,079 $ 365,278 $ 413,185 Cash Position Cash Generated in Current Year $ 15,524 $ 17,709 $ 18,569 $ 19,436 $ 20,311 Cash Generated in Previous Years n/a 15,524 33,233 51,802 71,238 Cash Generated from Property Sale 231, , , , ,478 Cash Inflow (Outflow) from Refinancing Original Initial Investment (232,500) (232,500) (232,500) (232,500) (232,500) Total Potential CASH Generated $ 14,347 $ 72,638 $ 134,379 $ 198,662 $ 265,526 Financial Measurements Debt Coverage Ratio (DCR) Loan-to-Value Ratio (LVR) 70.0% 66.2% 62.5% 58.7% 55.0% Capitalization Rate Based on Cost 8.31% 8.50% 8.70% 8.90% 9.11% Capitalization Rate Based on Resale Price 8.00% 8.00% 8.00% 8.00% 8.00% Gross Rent Monthly Multiplier (GRM) Gross Rent Yearly Multiplier (GRM) Value of Property Using this GRM , , , ,882 1,006,620 Break-Even Ratio 76.00% 74.86% 73.74% 72.64% 71.55% Operating Expense Ratio 29.92% 29.70% 29.48% 29.26% 29.05% Cash-on-Cash Return with Equity 6.17% 25.20% 22.71% 20.40% 18.58% Cash-on-Cash Return - Before Taxes 9.49% 10.26% 11.05% 11.85% 12.67% Internal Rate-of-Return (IRR) - Before Taxes 9.07% 18.13% 20.36% 20.97% 21.00% Modified Internal Rate-of-Return (MIRR) - Before Taxes 9.07% 17.52% 19.09% 19.16% 18.76% 2/19/2016 4:46 PM Cash Flow Analyzer

4 Unit Description Number of Units Per unit Total Percent of Monthly Rent Monthly Annual Sq Ft Sq Ft Total Rev/ Sq Ft Per Unit Rent Rent 2 Bed, 1.5 Bath A % $ 875 $ 875 $ 10,500 2 Bed, 1.5 Bath A % $ 850 $ 850 $ 10,200 2 Bed, 1.5 Bath A % $ 750 $ 750 $ 9,000 2 Bed, 1.5 Bath A % $ 750 $ 750 $ 9,000 2 Bed, 1.5 Bath B % $ 800 $ 800 $ 9,600 2 Bed, 1.5 Bath B % $ 750 $ 750 $ 9,000 2 Bed, 1.5 Bath B % $ 800 $ 800 $ 9,600 2 Bed, 1.5 Bath B % $ 850 $ 850 $ 10,200 2 Bed, 1.5 Bath C % $ 800 $ 800 $ 9,600 2 Bed, 1.5 Bath C % $ 750 $ 750 $ 9,000 2 Bed, 1.5 Bath C % $ 850 $ 850 $ 10,200 2 Bed, 1.5 Bath C % $ 850 $ 850 $ 10, % $ $ $ Totals 12 10,656 10, % ,675 $ 9,675 $ 116,100

5 Expense Description Annual Amount Annual Increase Per Unit Per Sq Ft % of % of Expenses Revenue Plumbing Postage Make-Ready Insurance Management Fee Professional Fees Repairs Property Taxes Electric/Water Trash Removal % % 0.1% % % 0.0% 3, % % 2.8% 4, % % 3.9% 8, % 7.4% % % 0.3% 2, % % 2.7% 11, % % 10.6% % % 0.7% 1, % % 1.4% Total Annual Operating Expenses $ 33,002 $ 2,750 10, % 29.9%

6 Annual Property Operating Data Year 1 Sq Ft Per Unit Year 2 Sq Ft Per Unit Year 3 Sq Ft Per Unit Year 4 Sq Ft Per Unit Year 5 Sq Ft Per Unit Potential Rental Income $ 116, $ 118, $ 120, $ 123, $ 125, Less: Vacancy & Credit Losses (5,805) (5,921) (6,040) (6,160) (6,284) Effective Gross Income $ 110, $ 112, $ 114, $ 117, $ 119, Operating Expenses Plumbing Postage Make-Ready 3, , , , , Insurance 4, , , , , Management Fee 8, , , , , Professional Fees Repairs 2, , , , , Property Taxes 11, , , , , Electric/Water Trash Removal 1, , , , , Total Operating Expenses $ 33, $ 33, $ 33, $ 34, $ 34, Net Operating Income (NOI) $ 77, $ 79, $ 80, $ 82, $ 84, Less: Annual Debt Service (55,238) (55,238) (55,238) (55,238) (55,238) Cash Flow Before Taxes $ 22, $ 23, $ 25, $ 27, $ 29, Cash Flow Analyzer

Cash Flow After Taxes Cash Flow Before Taxes $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $ 1 2 3 4 5 Time Net Operating MIP Payments Debt Cash Flow Incomes Cash Flow Period Income Service Before

7 Cash Flow After Taxes Cash Flow Before Taxes $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $ Time Net Operating MIP Payments Debt Cash Flow Incomes Cash Flow Period Income Service Before Tax Taxes After Tax Int Investment $ (232,500) $ (232,500) Year 1 77,293 - (55,238) 22,055 (6,531) 15,524 Year 2 79,088 - (55,238) 23,849 (6,140) 17,709 Year 3 80,921 - (55,238) 25,682 (7,113) 18,569 Year 4 82,793 - (55,238) 27,554 (8,118) 19,436 Year 5 84,705 - (55,238) 29,467 (9,156) 20, Cash Flow Analyzer

8 After Taxes Before Taxes 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Time Initial Investment Cash Flow Cash on Cash Income Cash Flow Cash on Cash Period Adj for Refinance Before Taxes Before Taxes Taxes After Taxes After Taxes Year 1 $ 232,500 $ 22, % $ (6,531) $ 15, % Year 2 232,500 23, % (6,140) 17, % Year 3 232,500 25, % (7,113) 18, % Year 4 232,500 27, % (8,118) 19, % Year 5 232,500 29, % (9,156) 20, % Cash Flow Analyzer

9.20% 9.00% 8.80% 8.60% 8.40% 8.20% 8.00% 7.80% 1 2 3 4 5 Time Net Operating Cap Rate on Cost Resale Period Income (NOI) $ 930,000 Value Year 1 $ 77,293 8.

9 9.20% 9.00% 8.80% 8.60% 8.40% 8.20% 8.00% 7.80% Time Net Operating Cap Rate on Cost Resale Period Income (NOI) $ 930,000 Value Year 1 $ 77, % $ 966,163 Year 2 79, % 988,595 Year 3 80, % 1,011,507 Year 4 82, % 1,034,910 Year 5 84, % 1,058, Cash Flow Analyzer

10 Time Net Operating Mortgage Debt Coverage Period Income Payments Before Taxes Year 1 $ 77,293 $ (55,238) 1.40 Year 2 79,088 (55,238) 1.43 Year 3 80,921 (55,238) 1.46 Year 4 82,793 (55,238) 1.50 Year 5 84,705 (55,238) Cash Flow Analyzer

11 Return on Equity (ROE) 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Required Return on Equity Time Period Rental Annual Change Annual Change Trapped Return on Hold Cash Flow in Equity in Net Worth Equity Equity (ROE) Sell 6.00% A B (A + B) Year 1 15,524 (1,177) 14, , % Hold After Year Year 2 17,709 40,582 58, , % Hold 5 Year 3 18,569 43,172 61, , % Hold Year 4 19,436 44,846 64, , % Hold Year 5 20,311 46,554 66, , % Hold Cash Flow Analyzer

12 BreakEven Occupancy BreakEven Occupancy with Cash on Cash Requirment 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% Cash on Cash Time Period Potential Operating, Debt, Occupancy BreakEven Max Vacancy BreakEven Max Vacancy Requirement Rental Income Reserve Expenses Rate (Existing) Occupancy Rate BreakEven Rate Occupancy Rate BreakEven Rate 6.00% w/ Cash on Cash w/ Cash on Cash Year 1 116,100 (88,240) 95.00% 76.00% 24.00% 88.02% 11.98% Year 2 118,422 (88,652) 95.00% 74.86% 25.14% 86.64% 13.36% Year 3 120,790 (89,069) 95.00% 73.74% 26.26% 85.29% 14.71% Year 4 123,206 (89,491) 95.00% 72.64% 27.36% 83.96% 16.04% Year 5 125,670 (89,920) 95.00% 71.55% 28.45% 82.65% 17.35% Cash Flow Analyzer

13 I. Rental Income & Expenses Rental Income / Rent Roll: Operating Expenses: II. Property Costs & Characteristics Select Property Type from Drop-Down Menu: Purchase Price of Property: Contract Purchase Price $ 930,000 Initial Improvements Closing Costs Other Initial Costs - Other Initial Costs Other Initial Costs % of Cost Allocated to Land 20.00% $ 930,000 Reserv e Amount Annual Increase Tax Expense Portion Reserves & Specific Improvements 1.00% 50.00% Description Amount Select Year Increase FMV? $ 1 No $ 1 No $ 1 No $ 1 No $ 1 No $ 1 No $ 1 No Total $ III. Resale Valuation Method Choose Resale Method Enter FMV and Use One Appreciation Rate for All Years Enter FMV and Enter Different Annual Appreciation Rates Use Cap Rate Based on Current Year's NOI Use Cap Rate Based on Following Year's NOI EOY One Valuation Using Cap Rate $ Enter a Cap Rate Future Selling Expense (% of Selling Price): 966, % 6.00% IV. Financing Down Payment Percentage 25.0% Amount Borrowed or Assumed: $ 697,500 $ Interest Rate: 5.000% Mortgage #1 Mortgage #2 Mortgage #3 Term / Remaining Term of Loan (In Months): Interest Calculation Type: Monthly Monthly Monthly Refinance Mortgage #1 or #2? Additional Monthly Payment: Start Month: Month 1 Start Year: Year 1 Monthly Mortgage Payment: (Formula) $ 4,603 $ $ Finance Points? Yes No Loan Origination Points - - Loan Origination Points (In Dollars) $ $ $ Amortization Type Initial Investment or Down Payment (Cost less Debt - Automatically Calculated) $ 232,500 MIP Payments? Down Payment as a % of Cost 25.00% Yes No Down Payment as a % of FMV 24.06% V. Income Taxes Before Tax Presentation? Yes No Federal Marginal Income Tax Rate: Federal Long-Term Capital Gains Rate: State Marginal Income Tax Rate: Are Your Losses Limited by the Passive Loss Rules? Like-Kind Exchange on Disposition? Property Held in Roth/IRA/401k Account?

Devoe Street Devoe Street Tallahassee, FL % Occupied Rent on the Rise Managed Built in 2007 Positive Cash Flow.

Devoe Street Devoe Street Tallahassee, FL % Occupied Rent on the Rise Managed Built in 2007 Positive Cash Flow. 100% Occupied Rent on the Rise Managed Built in 2007 Positive Cash Flow Prepared for Presented by Sealey Real Estate Solutions 1245 Cedar Center Drive brian@sealeyteam.com Tallahassee FL 32301 Sealey Real