RubinBrown Apartment Stats 2013

‘13 APARTMENT STATS

A Publication of RubinBrown LLP

Welcome

RubinBrown is pleased to present the 2013 Apartment Statistical Analysis, an annual survey compiled by the Real Estate Services Group.

Each year, data is collected from our clients, as well as other contacts and referrals within the industry, to comprise averages in a variety of markets within the United States.

The accompanying statistical information includes operational data for 2012 and represents 420 apartment projects in approximately 30 states. While these averages are representative of a smaller pool of projects, the trends are usually consistent with those experienced at the national level.

If you have questions about the content of this publication, please contact us (see page 16 for contact information).

RubinBrown Real Estate Services Group

Contents 1 Executive Summary 3 Comparison of Operations 4 Government Assisted 8 Government Assisted by Region 10 Government Assisted by Project Size 12 Market Rate 14 Low Income Tax Credit Projects 16 RubinBrown Real Estate Services Group

@RubinBrownRE www.RubinBrownRealEstate.com

Executive Summary

Industry Update Throughout 2012, the apartment sector continued to build upon its strong momentum gained in 2010 and 2011. Favorable demographics coupled with ongoing economic stress and fallout from the foreclosure crisis have continued to benefit the apartment sector in 2012. Renter demographics remain favorable for the rental housing market, which are maintaining historic high levels of occupancy and rent. Generation Y (those individuals born between 1982 and 1995) continue to show a strong propensity to rent given their economic and social situations. Economically, renting makes sense for Gen Y given the continued slow income growth resulting from the slow economic expansion during the past several years. As a result, many are still financially unable to purchase a home. Socially, individuals move, on average, over 9 times in their life after the age of 18, according to the U.S. Census Bureau, as they pursue life experiences and career opportunities. Gen Y is embracing the freedom renting provides relative to the cost and burden of homeownership. The U.S. homeownership rate continued its recent trend by decreasing another 0.7% from 66.1% in 2011 to 65.4% in 2012. As a result of the economic and social shifts over the past few years, vacancy rates have dipped to a record low of 5.5% nationally during 2012, down from a previous historic low of 6.2% in 2011. The National Association of Realtors expects the vacancy rate to continue to decline to a low of 4.7% in 2013. In response to this increased rental demand, multifamily housing permits, starts and completions have risen significantly again in 2012. According to Real Capital Analytics, apartment construction jumped 67% to $4.9 billion for the first half of 2012 versus the first half of 2011. In terms of units, new construction has increased from a low of 75,000 units in 2009 to just over 300,000 units in 2012. Policy Update As we started 2013, Congress completed passage of the American Taxpayer Relief Act , which side stepped certain elements of the fiscal cliff and included a number of tax extenders important to the affordable housing industry. The largest impact was the 9% housing tax credit (LIHTC) floor extension. This important provision fixed the credit percentage at 9% for new construction and substantial rehabilitation credits and provided the industry a two- year extension for projects receiving 2013 allocations,

essentially guaranteeing the availability of the private equity needed to make the projects financially feasible. The provision, however, did not apply to forward allocations for 2014 or after, even if received in 2013. LIHTC accounts for the majority – approximately 90% - of all affordable rental housing created in the U.S. today and has financed the construction of over 2.5 million affordable homes since its inception in 1986. The affordable housing industry worked very hard to ensure this provision would be included and many thanks go to the strong leadership and support by Senators Maria Cantwell (D-WA) and Olympia Snowe (R-ME) who were able to include the provision in the Senate finance committee bill. The new tax legislation extends the New Markets Tax Credit (NMTC) for two years, permitting a maximum annual amount of qualified equity investments of $3.5 billion each year. The extension is for years 2012 and 2013. In addition, 50% bonus depreciation was extended for certain eligible properties placed in service before 2014. The tax treatment of carried interest is also under debate. While typically associated with financial interests and fund managers, carried interest is a common and important mechanism in the real estate industry to attract investment, allocate business risk, and align the interests of developers and investors. Increasing the tax rate on carried interests for real estate would likely reduce the rate of multifamily construction going forward. Although the bill is very positive, there is still much work to do for the affordable housing, economic development and renewal energy industries as we face a brutal debate on tax reform. Market Trends The biggest question on the horizon is the rate at which the housing market recovers and its impact on the demand for apartments. Housing prices have been trending upward generally across the U.S. for the past six to twelve months. In addition, according to a study published by Freddie Mac, rates on a 30-year fixed- rate mortgage bottomed out at an average of 3.35% in December 2012 but have shot up to 4.46% by August 2013. The National Association of Realtors expects the vacancy rate to increase back to 5.8% by 2015. This is due to skyrocketing supply coupled with an expected eventual shift back to homeownership as renters make the jump to buy homes before interest rates and home prices grow too high.

RubinBrown Apartment Stats 2012 | 1

Executive Summary

However, the industry does have some wild cards looming on the horizon. Besides the potential threat of oversupply in the coming years, pending legislation could have a substantial effect on the industry’s continued growth – namely in the affordable housing and tax credit arenas – as the extensions passed early in 2013 are set to expire in 2014. Budget reform is expected to take center stage again when Congress meets in early 2014. Despite the strengths of the industry’s mission and overall community impact, it is uncertain the impact the pressure to pass a balanced budget will have on programs essential to the industry. RubinBrown invites you to utilize this study as a development and management tool to compare your financial operations to the operating results of your peers. This study also provides sound comparable data to utilize in formulating an acquisition model. Like all compilations of data, it will be most useful when carefully and properly interpreted. We sincerely thank everyone who took time to participate in RubinBrown’s survey.

As apartment owners look into the future, the focus will begin to shift toward pricing power. Price increases will be less effective at making up for increased vacancies as most units have already been priced as expensive as possible during the days of record low vacancy rates. All in all, the multifamily housing market is still poised to continue to perform very well, even as the recent growth rate and record vacancy rates stabilize. A RubinBrown survey conducted in January 2013 of clients and colleagues showed that 50.0% of those surveyed were considering starting new developments in 2013, 21.5% were considering asset or GP acquisitions, 21.4% were considering selling or repositioning properties in their current portfolios, and only 7.1% were not planning growth opportunities. Conclusion Current economic and social trends point towards a solid and healthy multifamily market through at least 2015. The continued slow recovery felt in the single family housing market as well as the current shift in the rent versus buy perspective remain impactful on the industry’s recovery.

2 | RubinBrown Apartment Stats 2012

Comparison of Operations

Government Assisted

Market Rate

Total Number of Projects

386

34

Average Project Age In Years

10.6

10.4

Average Number of Units

107

248

Averages Per Unit: Monthly Rent

$699

$766

Square Feet

932

926

Rooms

4.31

4.14

Economic Occupancy

88.6%

85.0%

Net Operating Income Before Debt Service & Depreciation as a Percentage of Total Income

35.4%

49.0%

A

B

C

A

B

C

Revenues

Gross Potential Rent

$8,383

$8.99

100.0%

$9,193

$9.93

100.0%

Less: Vacancy Loss

(758)

(0.81)

-9.0%

(824)

(0.89)

-9.0%

Collection Loss

(127)

(0.14)

-1.5%

(116)

(0.13)

-1.3%

(79)

(0.08)

-0.9%

(435)

(0.47)

-4.7%

Concession Loss

Rent Collected

7,419

$7.96

88.6%

7,818

8.44

85.0%

375

0.40

4.5%

821

0.89

8.9%

Other Income

$7,794

$8.36

93.1%

$8,639

$9.33

93.9%

Total Income

Expenses

Salaries and Personnel

$1,031

$1.11

12.3%

$976

$1.05

10.6%

Administrative

453

0.49

5.4%

305

0.33

3.3%

Marketing

52

0.06

6.0%

127

0.14

1.4%

Management Fees

434

0.47

5.2%

350

0.38

3.8%

Utilities

784

0.84

9.4%

596

0.64

6.5%

Carpeting

129

0.14

1.5%

146

0.16

1.6%

Painting

53

0.06

0.6%

118

0.13

1.3%

Landscaping

160

0.17

1.9%

125

0.14

1.4%

HVAC

56

0.06

0.7%

32

0.03

0.4%

Appliances

48

0.05

0.6%

63

0.07

0.7%

Plumbing

44

0.05

0.5%

41

0.04

0.4%

Electrical

26

0.03

0.3%

15

0.02

0.2%

Other Repairs and Services

912

0.98

10.9%

514

0.55

5.6%

Insurance

284

0.30

3.4%

264

0.28

2.9%

Real Estate Taxes

464

0.50

5.5%

690

0.75

7.5%

103

0.11

1.2%

48

0.05

0.5%

Other Taxes

Total Expenses

$5,033

$5.42

60.0%

$4,410

$4.76

48.1%

Net Operating Income Before Debt Service and Depreciation

$2,761

$2.94

33.1%

$4,229

$4.57

45.8%

Capital Expenditures

$189

$0.20

2.3%

$770

$0.83

8.4%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

RubinBrown Apartment Stats 2012 | 3

Government Assisted

2012

2011

2010

Total Number of Projects

386

372

363

Average Number of Units

107

105

115

Averages Per Unit:

Monthly Rent

$699

$721

$673

Square Feet

932

964

940

Rooms

4.31

4.32

4.34

Economic Occupancy

88.6%

89.4%

86.9%

Net Operating Income Before Debt Service & Depreciation as a Percentage of Total Income

35.4%

40.0%

37.8%

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$8,383

$8.99

100.0%

$8,653

$8.98

100.0%

$8,078

$8.59

100.0%

Less: Vacancy Loss

(758)

(0.81)

-9.0%

(704)

(0.73)

-8.1%

(826)

(0.88)

-10.2%

Collection Loss

(127)

(0.14)

-1.5%

(130)

(0.13)

-1.5%

(128)

(0.14)

-1.6%

Concession Loss

(79)

(0.08)

-0.9%

(84)

(0.09)

-1.0%

(105)

(0.11)

-1.3%

Rent Collected

7,419

7.96

88.6%

7,735

8.03

89.4%

7,019

7.46

86.9%

Other Income

375

0.40

4.5%

469

0.49

5.4%

410

0.44

5.1%

Total Income

$7,794

$8.36

93.1%

$8,204

$8.52

94.8%

$7,429

$7.90

92.0%

Expenses

Salaries and Personnel

$1,031

$1.11

12.3%

$892

$0.93

10.3%

$801

$0.85

9.9%

Administrative

453

0.49

5.4%

454

0.47

5.2%

422

0.45

5.2%

Marketing

52

0.06

0.6%

102

0.11

1.2%

96

0.10

1.2%

Management Fees

434

0.47

5.2%

444

0.46

5.1%

406

0.43

5.0%

Utilities

784

0.84

9.4%

831

0.86

9.6%

717

0.76

8.9%

All Repair, Maintenance and Contract Services

1,428

1.54

17.0%

1,475

1.53

17.1%

1,324

1.41

16.4%

Insurance

284

0.30

3.4%

350

0.36

4.0%

298

0.32

3.7%

Real Estate Taxes

464

0.50

5.5%

514

0.53

5.9%

461

0.49

5.7%

Other Taxes

103

0.11

1.2%

110

0.11

1.3%

95

0.10

1.2%

Total Expenses

$5,033

$5.42

60.0%

$5,172

$5.36

59.7%

$4,620

$4.91

57.2%

Net Operating Income Before Debt Service and Depreciation

$2,761

$2.94

33.1%

$3,032

$3.16

35.1%

$2,809

$2.99

34.8%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

4 | RubinBrown Apartment Stats 2012

Average Monthly Rent per Unit

2009

2008

$900 $1,000

226

226

129

130

$800

$721

$699

$673

$662

$637

$700

$662

$637

$600

926

937

4.19

4.20

$500

$400

86.9%

89.0%

$300

$200

$100

38.2%

38.2%

$0

2012

2011

2010

2009

2008

A

B

C

A

B

C

Economic Occupancy

90% 100%

$7,948

$8.58

100.0%

$7,644

$8.16

100.0%

89.4%

89.0%

88.6%

86.9%

86.9%

(825)

(0.89)

-10.4%

(630)

(0.67)

-8.2%

(133)

(0.14)

-1.7%

(111)

(0.12)

-1.4%

80%

(82)

(0.09)

-1.0%

(107)

(0.11)

-1.4%

70%

6,908

7.46

86.9%

6,796

7.26

89.0%

60%

331

0.36

4.2%

324

0.35

4.2%

50%

$7,239

$7.82

91.1%

$7,120

$7.61

93.2%

40%

30%

20%

$781

$0.84

9.8%

$770

$0.82

10.1%

10%

367

0.40

4.6%

371

0.40

4.8%

0%

89

0.10

1.1%

84

0.09

1.1%

2012

2011

2010

2009

2008

390

0.42

4.9%

388

0.42

5.1%

726

0.78

9.1%

691

0.74

9.0%

Gross Potential Rent vs. Net Operating Income per Square Foot

1,253

1.35

15.8%

1,188

1.26

15.2%

283

0.31

3.6%

305

0.33

4.0%

$2.94 $8.99

2012

471

0.51

5.9%

495

0.53

6.5%

$3.16 $8.98

2011

107

0.12

1.4%

106

0.11

1.4%

$2.99 $8.59

$4,467

$4.83

56.2%

$4,398

$4.70

57.5%

2010

$2.99 $8.58

2009

$2,772

$2.99

34.9%

$2,722

$2.91

35.7%

$2.91 $8.16

2008

Net Operating Income

Gross Potential Rent

RubinBrown Apartment Stats 2012 | 5

Government Assisted

Expense Trends per Unit

$1,031

$892

Salaries and Personnel

$801

$781

$770

$505

$556

Administrative and Marketing

$518

$456

$455

$1,428

$1,475

Contract Services and Repairs & Maintenance

$1,324

$1,253

$1,188

$851

$974

Taxes and Insurance

$854

$861

$906

$0

$250

$500

$750

$1,000 $1,250 $1,500

2011

2010

2009

2012

2008

6 | RubinBrown Apartment Stats 2012

Government Assisted by Region

North

East/Northeast

Midwest

South/Southeast

Total Number of Projects

19

60

204

59

Average Project Age In Years

10.8

11.8

10.1

10.5

Average Number of Units

91

124

95

124

Averages Per Unit: Monthly Rent

$703

$823

$655

$664

Square Feet

972

932

930

1,045

Rooms

4.13

4.47

4.34

4.83

Economic Occupancy

90.3%

89.3%

88.2%

84.7%

Net Operating Income Before Debt Service & Depreciation as a Percentage of Total Income

29.4%

43.1%

36.6%

24.5%

A

B

C

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$8,434

$8.68 100.0%

$9,879 $10.60 100.0%

$7,862

$8.46 100.0%

$7,966

$7.62 100.0%

Less: Vacancy Loss

(638) (0.66)

-7.6%

(887) (0.95)

-9.0%

(726) (0.78)

-9.2%

(951) (0.91) -11.9%

Collection Loss

(138) (0.14)

-1.6%

(137) (0.15)

-1.4%

(109) (0.12)

-1.4%

(172) (0.16)

-2.2%

(39) (0.04)

-0.5%

(35) (0.04)

-0.3%

(96) (0.10)

-1.2%

(97) (0.09)

-1.2%

Concession Loss

Rent Collected

7,619

7.84

90.3%

8,820

9.46

89.3%

6,931

7.46

88.2%

6,746

6.46

84.7%

453

0.46

5.4%

394

0.42

4.0%

425

0.45

5.4%

263

0.26

3.3%

Other Income

$8,072

$8.30 95.7%

$9,214

$9.88 93.3%

$7,356

$7.91 93.6%

$7,009

$6.72 88.0%

Total Income

Expenses

Salaries and Personnel

$1,013

$1.04

12.0%

$1,025

$1.10

10.4%

$998

$1.07

12.7%

$1,104

$1.06

13.9%

Administrative

541

0.56

6.4%

393

0.42

4.0%

419

0.45

5.3%

527

0.50

6.6%

Marketing

62

0.06

0.7%

56

0.06

0.6%

50

0.05

0.6%

52

0.05

0.7%

Management Fees

443

0.46

5.3%

493

0.53

5.0%

395

0.43

5.0%

425

0.41

5.3%

Utilities

975

1.00

11.6%

832

0.89

8.4%

699

0.75

8.9%

739

0.71

9.3%

Carpeting

102

0.10

1.2%

93

0.10

0.9%

126

0.14

1.6%

157

0.15

2.0%

Painting

36

0.04

0.4%

41

0.04

0.4%

39

0.04

0.5%

120

0.11

1.5%

Landscaping

96

0.10

1.1%

162

0.17

1.6%

127

0.14

1.6%

227

0.22

2.9%

HVAC

20

0.02

0.2%

56

0.06

0.6%

46

0.05

0.6%

83

0.08

1.0%

Appliances

24

0.02

0.3%

41

0.04

0.4%

32

0.03

0.4%

75

0.07

0.9%

Plumbing

19

0.02

0.2%

41

0.04

0.4%

27

0.03

0.3%

56

0.05

0.7%

Electrical

15

0.02

0.2%

26

0.03

0.3%

18

0.02

0.2%

31

0.03

0.4%

Other Repairs and Services

1,069

1.10

12.7%

877

0.94

8.9%

893

0.96

11.4%

866

0.83

10.9%

Insurance

255

0.26

3.0%

233

0.25

2.4%

284

0.31

3.6%

333

0.32

4.2%

Real Estate Taxes

727

0.75

8.6%

785

0.84

7.9%

415

0.45

5.3%

386

0.37

4.8%

303

0.31

3.6%

86

0.09

0.9%

93

0.10

1.2%

114

0.11

1.4%

Other Taxes

Total Expenses

$5,700

$5.86 67.5%

$5,240

$5.60 53.1%

$4,661

$5.02

59.2%

$5,295

$5.07

66.5%

Net Operating Income Before Debt Service & Depreciation

$2,372

$2.44 28.2%

$3,974

$4.25 40.2%

$2,695

$2.89

34.4%

$1,714

$1.65

21.5%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

8 | RubinBrown Apartment Stats 2012

Monthly Rent per Unit

South/Southwest

West/Northwest

17

27

10.5

12.1

136

116

$657

$802

932

732

4.55

3.05

88.7%

94.9%

34.9%

34.9%

Net Operating Income per Square Foot

A

B

C

A

B

C

$7,881

$8.46 100.0%

$9,620 $13.14 100.0%

(696) (0.75)

-8.8%

(318) (0.44)

-3.3%

(98) (0.11)

-1.2%

(130) (0.18)

-1.4%

(102) (0.11)

-1.3%

(38) (0.05)

-0.4%

6,985

7.49

88.7%

9,134

12.47

94.9%

437

0.47

5.5%

228

0.31

2.4%

$7,422

$7.96 94.2%

$9,362 $12.78 97.3%

$946

$1.02

12.0%

$1,177

$1.61

12.2%

392

0.42

5.0%

618

0.84

6.4%

Economic Occupancy

76

0.08

1.0%

23

0.03

0.2%

420

0.45

5.3%

575

0.79

6.0%

931

1.00

11.8%

1,086

1.48

11.3%

86

0.09

1.1%

203

0.28

2.1%

24

0.03

0.3%

45

0.06

0.5%

184

0.20

2.3%

216

0.29

2.2%

58

0.06

0.7%

72

0.10

0.8%

64

0.07

0.8%

109

0.15

1.1%

37

0.04

0.5%

150

0.21

1.6%

37

0.04

0.5%

61

0.08

0.6%

786

0.84

10.0%

1,275

1.74

13.3%

270

0.29

3.4%

310

0.42

3.2%

391

0.42

5.0%

128

0.18

1.3%

130

0.14

1.6%

50

0.07

0.5%

$4,832

$5.19

61.3%

$6,098

$8.33 63.3%

West/Northwest

North

East/Northeast

$2,590

$2.77

32.9%

$3,264

$4.45 34.0%

South/Southwest

Midwest

South/Southeast

RubinBrown Apartment Stats 2012 | 9

Government Assisted by Project Size

0-50 Units

51-100 Units

101-150 Units

151-200 Units

Over 200 Units

Total Number of Projects

95

109

99

43

40

Average Project Age In Years

9.9

9.6

11.0

13.2

11.6

Average Number of Units

31

75

122

177

263

Averages Per Unit: Monthly Rent

$608

$675

$719

$721

$702

Square Feet

1,042

880

904

950

945

Rooms

4.84

4.05

4.16

4.38

4.40

Economic Occupancy

89.6%

91.1%

89.3%

87.5%

86.0%

Net Operating Income Before Debt Service & Depreciation as a Percentage of Total Income

24.2%

34.8%

36.5%

32.4%

39.6%

A

B

A

B

A

B

A

B

A

B

Revenues

Gross Potential Rent

$7,299

$7.01

$8,102

$9.21

$8,631

$9.55

$8,656

$9.11

$8,424

$8.92

Less: Vacancy Loss

(507) (0.49)

(535) (0.61)

(762) (0.84)

(860) (0.90)

(923) (0.98)

Collection Loss

(135) (0.13)

(106) (0.12)

(115) (0.12)

(156) (0.16)

(139) (0.15)

Concession Loss

(116) (0.11)

(82) (0.09)

(46) (0.05)

(66) (0.07)

(114) (0.12)

Rent Collected

6,541

6.28

7,379

8.39

7,708

8.54

7,574

7.98

7,248

7.67

Other Income

456

0.44

291

0.33

374

0.41

297

0.31

474

0.50

Total Income

$6,997

$6.72

$7,670

$8.72

$8,082

$8.95

$7,871

$8.29

$7,722

$8.17

Expenses

Salaries and Personnel

$933

$0.90

$1,108

$1.26

$1,086

$1.20

$1,075

$1.13

$904

$0.96

Administrative

767

0.74

514

0.58

470

0.52

418

0.44

322

0.34

Marketing

28

0.03

52

0.06

47

0.05

63

0.07

55

0.06

Management Fees

432

0.41

428

0.49

465

0.51

438

0.46

401

0.42

Utilities

678

0.65

741

0.84

852

0.94

873

0.92

705

0.75

Carpeting

111

0.11

132

0.15

129

0.14

130

0.14

131

0.14

Painting

67

0.06

55

0.06

40

0.04

75

0.08

46

0.05

Landscaping

159

0.15

156

0.18

175

0.19

188

0.20

126

0.13

HVAC

55

0.05

65

0.07

53

0.06

77

0.08

39

0.04

Appliances

42

0.04

46

0.05

42

0.05

82

0.09

34

0.04

Plumbing

35

0.03

51

0.06

45

0.05

62

0.07

28

0.03

Electrical

11

0.01

25

0.03

30

0.03

36

0.04

18

0.02

Other Repairs and Services

1,040

1.00

774

0.88

897

0.99

1,033

1.09

914

0.97

Insurance

394

0.38

293

0.33

275

0.30

250

0.26

281

0.30

Real Estate Taxes

444

0.43

439

0.50

414

0.46

450

0.47

557

0.59

Other Taxes

108

0.10

121

0.14

109

0.12

73

0.08

102

0.11

Total Expenses

$5,304

$5.09

$5,000

$5.68

$5,129

$5.65

$5,323

$5.62

$4,663

$4.95

Net Operating Income Before Debt Service and Depreciation

$1,693

$1.63

$2,670

$3.04

$2,953

$3.30

$2,548

$2.67

$3,059

$3.22

Capital Expenditures

$283

$0.27

$219

$0.25

$67

$0.07

$213

$0.22

$156

$0.17

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

10 | RubinBrown Apartment Stats 2012

Market Rate

2012

2011

2010

Total Number of Projects

34

35

20

Average Number of Units

248

246

238

Averages Per Unit:

Monthly Rent

$766

$674

$763

Square Feet

926

938

932

Rooms

4.14

4.20

4.30

Economic Occupancy

85.0%

88.6%

82.8%

Net Operating Income Before Debt Service & Depreciation as a Percentage of Total Income

49.0%

49.4%

45.5%

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$9,193

$9.93

100.0%

$8,093

$8.63

100.0%

$9,153

$9.82

100.0%

Less: Vacancy Loss

(824)

(0.89)

-9.0%

(438)

(0.47)

-5.4%

(942)

(1.01)

-10.3%

Collection Loss

(116)

(0.13)

-1.3%

(62)

(0.07)

-0.8%

(113)

(0.12)

-1.2%

(435)

(0.47)

-4.7%

(420)

(0.45)

-5.2%

(520)

(0.56)

-5.7%

Concession Loss

Rent Collected

7,818

8.44

85.0%

7,173

7.64

88.6%

7,578

8.13

82.8%

821

0.89

8.9%

630

0.67

7.8%

692

0.74

7.6%

Other Income

$8,639

$9.33

93.9%

$7,803

$8.31

96.4%

$8,270

$8.87

90.4%

Total Income

Expenses

Salaries and Personnel

$976

$1.05

10.6%

$762

$0.81

9.4%

$794

$0.85

8.7%

Administrative

305

0.33

3.3%

339

0.36

4.2%

323

0.35

3.5%

Marketing

127

0.14

1.4%

104

0.11

1.3%

141

0.15

1.5%

Management Fees

350

0.38

3.8%

319

0.34

4.0%

330

0.35

3.6%

Utilities

596

0.64

6.5%

584

0.62

7.2%

645

0.69

7.1%

All Repairs and Maintenance and Contract Services

1,054

1.14

11.6%

883

0.94

10.9%

1,137

1.22

12.4%

Insurance

264

0.28

2.9%

233

0.25

2.9%

319

0.34

3.5%

Real Estate Taxes

690

0.75

7.5%

647

0.69

8.0%

673

0.72

7.3%

48

0.05

0.5%

76

0.08

0.9%

145

0.15

1.6%

Other Taxes

Total Expenses

$4,410

$4.76

48.1%

$3,947

$4.20

48.8%

$4,507

$4.82

49.2%

Net Operating Income Before Debt Service and Depreciation

$4,229

$4.57

45.8%

$3,856

$4.11

47.6%

$3,763

$4.05

41.2%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

12 | RubinBrown Apartment Stats 2012

Average Monthly Rent per Unit

2009

2008

$900 $1,000

14

13

$809

169

186

$766

$763

$728

$800

$674

$700

$809

$728

$600

823

862

4.37

4.40

$500

$400

87.7%

90.2%

$300

$200

$100

47.5%

49.3%

$0

2012

2011

2010

2009

2008

A

B

C

A

B

C

Economic Occupancy

$9,707

$11.80

100.0%

$8,738

$10.13

100.0%

90% 100%

90.2%

88.6%

(902)

(1.02)

-9.3%

(583)

(0.68)

-6.7%

87.7%

85.0%

82.8%

(52)

(0.06)

-0.5%

(93)

(0.11)

-1.1%

80%

(220)

(0.27)

-2.5%

(174)

(0.20)

-2.0%

70%

8,533

10.45

87.7%

7,888

9.14

90.2%

60%

502

0.61

5.2%

667

0.77

7.6%

50%

$9,035

$10.96

92.9%

$8,555

$9.91

97.8%

40%

30%

20%

$837

$1.02

8.6%

$861

$1.00

9.9%

465

0.57

4.8%

364

0.42

4.2%

10%

126

0.15

1.3%

149

0.17

1.7%

0%

2012

2011

2010

2009

2008

357

0.43

3.7%

379

0.44

4.3%

778

0.95

8.0%

616

0.72

7.1%

1,138

1.38

11.7%

1,092

1.27

12.5%

Gross Potential Rent vs. Net Operating Income per Square Foot

297

0.36

3.1%

334

0.39

3.8%

602

0.73

6.2%

458

0.53

5.2%

$4.57 $9.93

2012

139

0.17

1.4%

81

0.09

0.9%

$4.11 $8.63

2011

$4,739

$5.76

48.8%

$4,334

$5.03

49.6%

$4.05 $9.82

2010

$4,296

$5.20

44.1%

$4,221

$4.88

48.2%

$5.20 $11.80

2009

$4.88 $10.13

2008

Net Operating Income

Gross Potential Rent

RubinBrown Apartment Stats 2012 | 1 3

Low Income Tax Credit Projects

2012

2011

2010

Total Number of Projects

367

363

354

Average Number of Units

109

106

117

Averages Per Unit:

Monthly Rent

$697

$722

$676

Square Feet

947

952

947

Rooms

4.38

4.37

4.38

Economic Occupancy

88.8%

89.2%

86.9%

Net Operating Income Before Debt Service & Depreciation as a Percentage of Total Income

35.4%

36.9%

37.8%

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$8,370

$8.84

100.0%

$8,665

$9.11

100.0%

$8,110

$8.56

100.0%

Less: Vacancy Loss

(748)

(0.79)

-8.9%

(718)

(0.75)

-8.3%

(828)

(0.87)

-10.2%

Collection Loss

(129)

(0.14)

-1.5%

(130)

(0.14)

-1.5%

(130)

(0.14)

-1.6%

(67)

(0.07)

-0.8%

(83)

(0.09)

-1.0%

(106)

(0.11)

-1.3%

Concession Loss

Rent Collected

7,426

7.84

88.8%

7,734

8.13

89.2%

7,046

7.44

86.9%

373

0.39

4.4%

465

0.49

5.4%

413

0.44

5.1%

Other Income

$7,799

$8.23

93.2%

$8,199

$8.62

94.6%

$7,459

$7.88

92.0%

Total Income

Expenses

Salaries and Personnel

$1,031

$1.09

12.3%

$890

$0.94

10.3%

$803

$0.85

9.9%

Administrative

450

0.48

5.4%

453

0.48

5.2%

423

0.45

5.2%

Marketing

51

0.05

0.6%

102

0.11

1.2%

96

0.10

1.2%

Management Fees

434

0.46

5.2%

444

0.47

5.1%

408

0.43

5.0%

Utilities

792

0.84

9.5%

829

0.87

9.6%

720

0.76

8.9%

All Repair, Maintenance and Contract Services

1,435

1.52

17.1%

1,476

1.55

17.0%

1,334

1.40

16.4%

Insurance

282

0.30

3.4%

348

0.37

4.0%

298

0.31

3.7%

Real Estate Taxes

459

0.48

5.5%

518

0.54

6.0%

463

0.49

5.7%

103

0.11

1.2%

110

0.12

1.3%

95

0.10

1.2%

Other Taxes

Total Expenses

$5,037

$5.33

60.2%

$5,170

$5.45

59.7%

$4,640

$4.89

57.2%

Net Operating Income Before Debt Service and Depreciation

$2,762

$2.90

33.0%

$3,029

$3.17

34.9%

$2,819

$2.99

34.8%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

14 | RubinBrown Apartment Stats 2012

Average Monthly Rent per Unit

2009

2008

$900 $1,000

122

130

125

123

$800

$722

$697

$680

$676

$656

$700

$680

$656

$600

983

986

4.63

4.62

$500

$400

87.1%

89.2%

$300

$200

$100

37.4%

38.2%

$0

2012

2011

2010

2009

2008

A

B

C

A

B

C

Economic Occupancy

$8,159

$8.30

100.0%

$7,866

$7.98

100.0%

90% 100%

89.2%

89.2%

88.8%

(838)

(0.85)

-10.3%

(652)

(0.66)

-8.3%

87.1%

86.9%

(137)

(0.14)

-1.7%

(129)

(0.13)

-1.6%

80%

(77)

(0.08)

-0.9%

(67)

(0.07)

-0.9%

70%

7,107

7.23

87.1%

7,018

7.12

89.2%

60%

342

0.35

4.2%

329

0.33

4.2%

50%

$7,449

$7.58

91.3%

$7,347

$7.45

93.4%

40%

30%

20%

$764

$0.78

9.4%

$706

$0.72

9.0%

364

0.37

4.5%

380

0.39

4.8%

10%

87

0.09

1.1%

79

0.08

1.0%

0%

2012

2011

2010

2009

2008

390

0.40

4.8%

403

0.41

5.1%

799

0.81

9.8%

758

0.77

9.6%

1,351

0.14

16.5%

1,208

1.22

15.4%

Gross Potential Rent vs. Net Operating Income per Square Foot

276

0.28

3.4%

302

0.31

3.8%

523

0.53

6.4%

600

0.61

7.6%

$2.90 $8.84

2012

109

0.11

1.3%

107

0.11

1.4%

$3.17 $9.11

2011

$4,663

$4.75

57.2%

$4,543

$4.62

57.8%

$2.99 $8.56

2010

$2,786

$2.83

34.1%

$2,804

$2.83

35.6%

$2.83 $8.30

2009

$2.83 $7.98

2008

Net Operating Income

Gross Potential Rent

RubinBrown Apartment Stats 2012 | 15

RubinBrown Real Estate Services Group

For more than 30 years, RubinBrown’s Real Estate Services Group has developed a strong reputation nationally as a leader in accounting and advisory services. Today, the group provides specialized services to real estate entities from coast to coast. The RubinBrown Real Estate Services Group provides a full range of assurance, tax, business planning, and consulting services to: • Investment funds • Real estate partnerships • Developers

Through the years, our clients have grown to depend on our expertise in four key areas of the real estate sector:

Affordable Housing: This complex and highly regulated industry has been one that RubinBrown has focused on since the early days of HUD and the advent of the federal low-income housing tax credit program. Historic Tax Credit Services: RubinBrown has extensive experience with consulting on historic rehabilitation projects across the country. New Markets Tax Credit Services: In addition to initial program guidance and consulting, RubinBrown experts can help you with NMTC application assistance. Renewable Energy: There are many new financial incentives for companies in the renewable energy sector. We can help you sort through the opportunities and provide financial guidance to move your businesses forward. In addition, the RubinBrown Real Estate Services Group regularly sponsors seminars and roundtables dealing with current topics affecting the real estate industry.

• Management companies • Governmental agencies • Syndicators and investors • Financial institutions • Construction-related companies

RubinBrown Real Estate Services Group’s services include: • Financial forecasts and projections • Cash flow and operational analyses • Specialized and complex tax planning • Troubled project workouts • HOPE VI consulting • Senior housing consulting • Business valuations • Low-income housing tax credit consulting and compliance • Affordable housing consulting and compliance • Historic rehabilitation tax credit consulting • Sales and Use Tax consulting • Governmental cost certifications (FHA & state housing agency) • NMTC consulting and compliance • Renewable energy consulting and compliance • Design and evaluation of financial reporting systems and internal control systems • Capital asset segregation analysis • Construction draw accounting and processing • Structured and complex deal structuring • Assistance in obtaining debt/equity financing • Like-kind exchange consulting

Bryan C. Keller, CPA Partner-In Charge 314.290.3341 bryan.keller@rubinbrown.com

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Frank Seffinger, CPA, LL.B., LL.M. Partner 303.952.1240 frank.seffinger@rubinbrown.com

• Strategic planning • Feasibility studies

16 | RubinBrown Apartment Stats 2012

@RubinBrownRE www.RubinBrownRealEstate.com

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