Re: Revised Renovation Analysis - Camaron at Woodcrest Apartments.

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Bernard Willis
5 years ago
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March 26, 2009 Jonathan J. Lichtman, Esq. LN Development Group, LLC 20283 State Road 7, Suite 300 Boca Raton, FL 33498 Re: Revised Renovation Analysis - Camaron at Woodcrest Apartments.

1 March 26, 2009 Jonathan J. Lichtman, Esq. LN Development Group, LLC State Road 7, Suite 300 Boca Raton, FL Re: Revised Renovation Analysis - Camaron at Woodcrest Apartments. Dear John, I have completed the attached revised Renovation Analysis of Camaron at Woodcrest Apartments. I have included a detailed Due Diligence Inspection Report derived from my recent personal inspection of all occupied and vacant units at the property, with a few exceptions. Upon my re-inspection of the property I found that the Seller has completed most of the units that were on our to-do list. This changes my initial renovation budget. We Also have negotiated an additional $215,000 renovation credit from the bank. We now need a total of $515,00 to complete the necessary upgrades to the Property, which includes the renovation credit. In addition, I inspected all exterior grounds and buildings. All estimates contained in the Renovation Analysis are reasonable and comparable with the renovation costs charged by other local contractors in the Talahassee area. LandMasters, Inc., (Florida General Contractor License No: CGC ) would act as the General Contractor for the project and would secure all necessary permits and complete the work in a professional manner. I estimate that the time frame to complete all work would be under nine months at this time. I anticipate having the 15 turn units completed within the first three months (5 units monthly) which coincide with our absorption estimate to rent up the property to a 92% occupancy within the first year of ownership. Simultaneously LandMasters, Inc. would award bids for roofs, exterior painting, stairs and decking, landscaping/sprinklers, pool, repairs, signage, washstation, and dog park. We would focus on turns first. Please adjust your projections accordingly. SS/Robert A. Nass

2 Camaron at Woodcrest Summary of Renovation Costs (51) Interior Upgrades $223,900 (15) Turn to Rent Units $71,400 Exterior Concrete Repairs $15,000 Railing Repairs $22,000 Replace Vinyl Shutters $18,900 (4) Roof Replacements $54,020 Lighting Sconces Exterior $17,780 Landscaping $58,000 Errosion and Drainage Repair $8,000 Car Wash Station $6,000 Painting and Pressure Cleaning Exterior $12,000 Pool Furniture $8,000 Totals $515,000 Renovation Credit From Compass Bank (215,000) Total Renovation Budget From Investor Capital $300,000

3 Camaron at Woodcrest Detailed Renovation Breakdown Turn to Rent Units (15) Cost This would consist of Paint, Two-Tone Updgrade, Punch, Repairs, $4760 Per Unit $71,400 Interior Upgrades (51 Units) Crown Molding Upgrades $25,000 Library Panels in Dining Room $21,000 Knockdown Two-tone Paint Upgrades $20,000 Kitchen Door Replacement $24,500 Remove Carpets and Convert to Tile $24,400 Install New Bathtubs $43,000 Kitchen and Bathroom Faucet Upgrades $21,000 Bath Vanity Replacements and Upgrades $15,000 Replace Interior Doors $30,000 Total for Interior Upgrades (51 Units) $223,900 Total Required to Turn 15 Units & 51 Interior Upgrades: $295,300 Roof Replacement (32) Total Roofs (26) New Roofs Needed. 4 Done At Purchase, 22 Done Upon Refinancing of Property (6) Already Done Avg. $8125/Sq. Ft. x Sq. Ft. = 1868 Sq. Ft. 150 per for Architectuals. Include Drip Edge and Flashing Tear Off. $54,020

4 Pressure Clean Clean 18 Buildings, Walkways, and Clean Gutters $12,000 Concrete Walks Repair and Replace Concrete Walkways $15,000 Railing Repairs and Painting Paint and Repair the Railings $22,000 Replace Vinyl Shutters All Vinyl Shutters Need to be Replaced and Painted $18,900 Lighting Sconces Exterior Install New Exterior Lighting Per Unit $17,780 Landscaping Budget Fill In Missing Shrubs, Resod Areas, Voids, Repair Sprinkler System. $58,000 Errosion Control and Drainage Issues Ensure Drainage is Properly Setup to Ensure Minimal Errosion $8,000 Pool Furniture Purchase New Pool Furniture $8,000 Car Wash Station Install Location So Residents Can Wash & Vacuum Cars. $6,000 TOTAL: $515,000

5 Camaron at Woodcrest Renovation Budget Flow Chart Months Errosion Ext Concrete Turn Units Roofs Replace Ext Paint Landscaping 1 $23,800 $3,000 $5,800 2 $23,800 $13,505 $1,500 $5,800 3 $23,800 $13,505 $1,500 $5,800 4 $13,505 $1,500 $5,800 5 $2,000 $3,000 $13,505 $1,500 $5,800 6 $2,000 $3,000 $1,500 $5,800 7 $2,000 $3,000 $1,500 $5,800 8 $2,000 $3,000 $5,800 9 $3,000 $5, $5, Totals: $8,000 $15,000 $71,400 $54,020 $12,000 $58,000 Pool Interior Car Wash Ext Lighting Railing Replace Totals Months Upgrades Sconces Repairs Vinyl Shutters 1 $37,316 $69,916 2 $8,000 $37,316 $89,921 3 $37,317 $6,000 $4,725 $92,647 4 $37,317 $4,400 $4,725 $67,247 5 $37,317 $4,400 $4,725 $72,247 6 $37,317 $4,400 $4,725 $58,742 7 $4,400 $16,700 8 $4,400 $15,200 9 $8,890 $17, $8,890 $14, Totals: $8,000 $223,900 $6,000 $17,780 $22,000 $18,900 $515,000

6 DUE DILIGENCE INSPECTION REPORT UNITS STAT BLDG UNIT # KEY PAINT CARPET BATH1 BATH2 HVAC HW HTR FRIDGE STOVE DSHWSR KITCHEN NOTES: CRO A G G G F E E G G G G Construc. repair/back door leak CRO A G G F F E E G G G G Construc. repair/bath 2 tile door TV A F F G G F F F G G F Turn O A F P G G G F G G G G VTN B G E G G E G E E G G Vacating 1/6/09 O B G G G E E E E E E E EU B HSH Employee Jennifer Russell Dog/Not home/lease? O B F P G G G F G G G F Toilet Lks/Ceiling Stain O B G F F G G G G G G G TV B F P G F E E G G G G Turn/Carpet replace RRV C G G G G E E G G G F Rent Ready O C G F F G E F G G G G Cracked tile EU C HSH Employee Adam Rielly HSH Employee Unit O C Sick child O C G G G G G G F G G RTV C Transfer Occupied Mold Issue O C G G G F E G G G G G O C Dogs/Not home RRV C G F G F F F G G G G Rent ready/tile broke RRV C G G G E E G G G G Rent ready O C F P F F E G G G G O C G G G F F G G G G O D G G G F F F G G G G O D G G G F F F E G G G Construc./needs sink O D G G G F E G G G G G TV D F F G G E F G G G G Bath ceiling/to be turned TV E P G G E E G G G G Paint/turn/tenant died in apt O E G G G E E F G G G Cracked tile O E G G G E E G G P G O E G G F E G G G G G Drywall repair bath

7 O E G G F F F G G G G O E G G F G G G G G G Shower bad O E G F G E E G G G G Ceiling stains O E G G F E E G G G G Shower bad O EE G P G G & G E G G G G G O EE G G G G F F G G G G O EE P P G G P F G G P G O EE G F G G & G E E E G G G O EE G F G F & G E G G G G F O EE F F F G & F F F G G G F Bathroom floor O F F F G F & G E G G G G G O F G F G F & G F E G G G G Front door sags O F G G G G F F G G G G O F G F F F & G F E G G G G O F G F G F & G G F G G G G Shower tile cracked O F G F G G G F G G E G Front door sags EEU FF Empire Employee Unit Empire employee unit EEU FF Empire Employee Unit Empire employee unit O FF G G G G E F G G G G O FF G G G G F F G G G G O G G G G F F G G G G Drywall repair O G G F F F F G G G G O G G G F G F G G G G Shower tile O G G F F G G G G G G O G F P F E G G G G G Shower tile CV G F NG G G E G G G G Construction/tub leaks O G G G F F G G G G G O G G G F E E G G G G Shower tile Bldg EE: Firewalls cracked Bldg G: Needs fire extinguisher, hall carpet NG, dry rotted door

8 O GG F F F P E G G G G F TV GG G G G F F E G None None F Needs appliances/bath floor O GG G G G G & G E E G G G G Bath needs sink O GG G G G G & G E E G G G G O H G G G G G E G G G G Rent ready/bath drywall repair O H P F F F G G F G F Tile cracked O H G G G F F G G G F Need faucet O H G F G G F F G G G G Holes in 2 tiles CV H G G G G F F G G G G Constr./Shower Tile O H G G G F F G G G G Ceiling stains RRV H G G G E F G G G G Rent ready/water leak (toilet) TV H G P G G F F G G G G Tub runs RRV HH G G G G G F G Need key ahu closet/rent ready EU HH MANDY HSH MANAGER UNIT No key/manager Unit CV HH P P P P F F F Construct. Unit RV HH G E G F F None G G G TV HH G P F E F G G G F Clean CV HH G F F G G G G G F Roof leak/not on constr. Units CV HH G NG F G G G P F F Toilet leaks O HH G G G F F G G G G O J Key 79, No Key O J G G G G F G G G G G O J G G G G F G G G G G Not Vacant/no lease M J MODEL MODEL MODEL MODEL MODEL MODEL MODEL MODEL MODEL MODEL Model CV JJ G G G-F F F N/G N/G F F Drywall repair bdrm/should be construct TV JJ G G G F F N/G G G G Rent ready/needs refrid. O JJ G G G F G G G G G CV JJ G G G G G G G G G Looks ready O JJ G E G F F G G F G O JJ Key not working

9 O JJ G G G G F G G G G O JJ G E G F G G G G G Clean/rent ready TV K F G G G G F G G G F Rent ready/kit. needs paint TV K No handle/key/did not inspect TV K G F G G F E G None F G TV K G G G E E None None G G O K G G G G F G G G G CV K G NG G G? F? G G G G Construct. Looks done? TV K G E G G F F None None None G Rent ready/needs appliances TV K G P F F F G NG F F F Construct. TV K F F G G F F G G F F Needs kitchen floor O K No key/did not inspect. O K G F? F F TV K F None F F F F F F F F Clean/paint/needs carpet TV KK G G G F E G F G G Bath mirror TV KK G G G G G None P F G Pantry paint/bath needs sink O KK G G G F F G G G G Bath ceiling repair TV KK G F P F None None None None P Need bath floor/ceiling O KK G P G F F G G G F TV KK G P F G F F F F F Needs Carpet O KK G G G G F G G G G O KK G F G G G G G G G Ceiling Stain TV L G P P F F P G P F Need bath ceiling O L G F F G F G G G F Carpet O 3/09 L F F F G E G G G G Need bath sink O L F F F DIDN'T INS F F F F F F Hotel lock?/did not inspect O 3/09 L F NG F F G F F F P Move out 2/28/09 O L F F F F G G G F F Move out 2/28/09 O L G F G E G G G G G O L G G G E E G G F G Bldg H: Steps Cracked Bldg K: Stairs are sloping, cracked at #104, railing needs welding, door needs paint, gutter problems, wash out problem

10 CV LL F P P E E G F F G Open/construction CV LL G G P F F NEEDS WHOLE KITCHEN Construction unit O LL F P F G G G G G G No ahu key O LL F P P G G G F O LL F NG F F F G G G G Tub runs CV LL G E P G F F F F F Open/done construction TV LL G NG P F G G G G G Construction/needs ext. door O LL G F F F F G G F G O M F F G G G G G G Bath ceiling stains O M F NG P G F G G G F Bath ceiling patch RV M G G F F F F F F G F Tub runs O M P NG P G G G G G F Construction TV M F F P G G P G P NG Cracked tile O M G P F P F G G G G F Construction O M Dog O M G F G E G G F F F Rent Ready O M G P F G G F G G G F Ceiling stains CV M F P F F F G G P P Ceiling down in l/r, constr. Not on list O M G F G F F G G None G Construct/Bath needs sink/drywall O M G NG NG G F F G F G F Construction CV MM G G P None None G NG F F Construction/leak in bath CV MM G NG F P NG G P F Construction CV MM CONSTRUCTION NEEDS EVERYTHING Construct. Needs Everything CV MM CONSTRUCTION NEEDS EVERYTHING ELSE Construct. Needs Everything TV MM PAINT P F E F G G G G Ceiling stains O MM G G G G G E G G G Bath floor V MM F P F None None G G G P Construction O MM G G G G F G P G G O N F P F F F G G F G TV N G F F F F P G G G Open Bldg R: Rotten facsia boards Bldg M: Stair treads need repair Sidewalk between Bldgs JJ & KK is all broken up Bldg LL: Needs concrete handicap ramp Bldg MM: Needs new roof, stairway( poor treads)

11 O N G G G G G G G G G CV N F P F F G G F G G Bath needs sink O N G G G F F G G G G Bath tile/vent fan Mltd RV N G G G E E G G G G Construction O N G G P F F G G G G Bath floor O N F P F F G G F G G Ceiling stain TV O G F P F NG F G G G F Needs hvac O O G F G F F G G G G Need bath sink CV O G NG NG P G F NG P F G Constr./no ret. on carp. O O G G G F G NG G F F G O P Come back/did not inspect. CV P P NG P F F G P P None NG Mold unit/construct. Not on list TV P G G G G G F G G G F Kitchen floor O P G F G F F F F G G G O Q G F F F E G G G F F TV Q F P F P F G G G F F Open/toilet leak/needs carpet TV Q G F G F E P G F F F Clean O Q F P F G F F G E G F CV R P None P F F None None G F No tub/shower/flrg/appl/carpet/constr. TV R F F F F F None G F F Bath Ceiling Patch O R F P F F F G G G F CV R F NG F F None P None NG P Open/Construct. Poor CV R P None P E None G G F F Open/no tub/shower/flrg/construct. TV R G P G F F G G F G Needs carpet/clean O R F G F F F G G F G TV R G F G E E G G G F Open/ceiling stain EU S HSH EMPLOY. KELLY & JIMM McDONALD Hsh mgmt empl/dog/countertop O S G G G G G G G G G G Fix door O S P G G G F G G F F G

12 TV S G F G G F F None None None F Carpet stretch, need GM/rent ready O S G F G G G G G G G Mold RV S G G F F G G G F G G GM CV S CONSTRUCTION NEEDS EVERY THING Construction CV S F NG P F F P P P F Construction O S G F G G G G G G G G O S Do Not Disturb! M S G G G G G G G G G G Model RRV S G G G G G G G G G G Rent ready TV S G NG G F F F F F F G Needs carpet CV S G F G F F G G G G G Ceiling needs repair CV S CONSTRUCTION NEEDS EVERY THING Construction needs everything O S G G G G G G F G G G CV T DIDN'T DO NSPECT. MISSED UNIT Missed O T F F G G F F G F CV T CONSTRUCTION NEEDS EVERY THING Construction needs everything O T G G G G F G G P F F CV U P NG F F G G None F F F Construction/roaches CV U CONSTRUCTION Construction TV U P G P G F F F F G P Fence in bkyd/toilet runs O U G F G G F G G G G G 8 Dogs! TV U P F F G G F None G G G Powder room/clean CV U G F P P F F G F G F Ceiling work/construction O U No key, looked ok O U F G G G G G G G G G CV V F F G G G G G G G Construction O V G F G G G G F F F F O V F F G G G G G G G G O V G G G G F G G G G G

13 CV W G NG P P F G G G F F Construction CV W P P P P G F G F Cabinets missing TV W G F G G F NG G G G G Turn/Need hw htr O W F G G G G G G G G G TV X F G F??? F F G G Turn/move out O X G F F G G G G G TV X DID NOT INSPECT MOVED 1/1/209 Didn't inspect? CV X CONSTRUCTION NOT ON LIST Construction need everything TV X F NG G?? G G G G Turn/carpet RV X G G G G G G G G G Rent ready/looks good O X G P F G G G G F G G Nds paint/whole wall/minor gm O X F P F F F G F F F F CV Y G G G F F P G G F F Minor GM CV Y CONSTRUCTION NEEDS NOT ON LIST Construction/roof leak CV Y G G G G G F G G G F Construction Done CV Y G G F G F G G P F F Construction Done * All screen doors need wheels * Need new pool furniture Status Codes C Construction Unit V Vacant CR Construction Repair Unit O Occupied RR Rent Ready N otice to Vacate T Turn Unit R Ready M Model EU mployee Unit EEU Empire Employee Unit

Total Rental Revenue 353, , , ,708, ,670, , ,065,155.81

Total Rental Revenue 353, , , ,708, ,670, , ,065,155.81 The Meadows (meadows) Page 1 REVENUE Rent Income Rent Revenue 375,500.00 375,249.00 251.00 0.07 2,861,791.81 2,852,686.81 9,105.00 0.32 4,357,760.81 Loss to Lease 561.00-1,887.00 2,448.00 129.73-777.00-9,870.00