RubinBrown Apartment Stats 2016

’16 APARTMENT STATS

A Publication of RubinBrown LLP

WELCOME

RubinBrown is pleased to present the 2016 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 2015 and represents approximately 460 apartment projects in roughly 29 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 17 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 17 RubinBrown Real Estate Services Group

@RubinBrownRE

@RubinBrownRealEstate

EXECUTIVE SUMMARY

Industry Update The multifamily rental housing industry had another good year in 2015. Although there were a large number of new properties completed in 2015, the demand continued to outpace the supply. The rents continued to increase while the vacancy rates remained relatively steady. The growth that we have seen in the rental housing market over the past years indicate that rental units are indeed a growing market within the housing industry and not just a temporary correction from the prior recession. According to the Multifamily Outlook 2016 published by Freddie Mac, in 2015, 306,000 family units were completed. Freddie Mac indicates that this is the most units entering the market in a single year since 1989. The study goes on to say that the level of multifamily supply is expected to remain elevated over the next few years, given that the number of new construction permits rose again in 2015. Despite the increase in interest rates by the Federal Reserve Bank in December 2015, the Freddie Mac publication indicates that in the short-term, the price growth and capitalization rates will not be significantly impacted in the multifamily rental housing market. The rental market continues to grow each year. In 2015, 36% of all households were renting. According to the Joint Center for Housing Studies of Harvard University this is the largest percentage since the late 1960’s. The study also says that in the past decade the number of renters has increased by nine million, which is the largest ten-year gain on record. This increase in rental demand has been across all income levels, age groups and household demographics. The increase is attributed to an aging population, the increase in baby-boomer renters and the mobility provided by renting preferred by single people and families without children. Millennials (born 1982–2004) are experiencing less purchasing ability because inflation is out pacing their salaries. In fact, several studies point to a trend that millennials are renting for a higher number of years than previous generations. According to the Survey of Market Absorption , new multifamily units are being constructed with fewer bedrooms than those built over the last 20 years. More than 50% of the unfurnished, market-rate rentals in structures of more than five units are studios or one-bedroom apartments.

While the number of low and very low income households continues to grow, the number of renters receiving assistance from the U.S. Department of Housing and Urban Development (HUD) is falling. This decline results in millions of households trying to find affordable housing in the private market. There has been increased pressure on state and local governments to assist these households as the federal response has not been strong enough. Market Trends Homeownership has continued to decrease to its lowest level in nearly 50 years. While the decline is especially large among the first-time home buyers group, we must also look at forfeitures. Corelogic estimates that more than 9.4 million homes, were forfeited through foreclosures, short sales and deeds in lieu of foreclosure from 2007–2015. Although forfeitures have continued to decline, they remain at twice the annual average rate from before the start of the housing crash in 2007. According to the Bankers Association the share of loans that are seriously delinquent (90 days or more past due or in foreclosure) has also fallen, but is currently at double the average of the first half of the 2000’s. We are likely to see continued downward homeownership rates over the next several years. According to the State of the Nation’s Housing 2016 , published by the Joint Center for Housing Studies of Harvard University, cost-burdened renters are at an all-time high. The number of households paying more than 50% of their income has grown to 11.4 million. The lowest-income renters’ (earning less than $15,000) is very high at 72%. In most market areas, at least half of the lowest-income renters have a severe housing cost burden. The nation still has a serious affordable housing issue. The demand for low-cost units is exceeding the supply. The gap between the supply and demand is the greatest for extremely low-income renters (earning up to 30% of the area median) but also is high for very low income renters (earning up to 50% of the area median). A study conducted by the National Low Income Housing Coalition found that for every 100 extremely low income renters there were only 31 units available and for every 100 very low income renters there were only 57 rental units available.

RubinBrown Apartment Stats 2016 | 1

EXECUTIVE SUMMARY

Accessible units have also been in short supply. Only about 1% of all rental units offer no-step entry, extra-wide halls and doors, single-floor living, lever door handles and accessible electrical controls. Many of these units are not affordable to elderly and disabled households because of the cost of rent. Renters are staying where they are in record numbers. According to data from property management software provider RealPage, renters who renewed their leases hit an all-time high of 53.8%. In the mid 2000’s the figure was closer to 45%. It is noteworthy that the renewal rate has been rising steadily since 2010. This rise is attributed to the high cost of home ownership, stricter standards to qualify for mortgages, millennials waiting to get married, while trying to save money and pay down student loan debt. Renters that would like to move are having difficulty finding units in the neighborhoods or at price points that they are seeking. Conclusion Demand for multifamily rental housing remained high in 2015 and was able to absorb most of the newly completed supply. Vacancy rates remained low while rents have continued to increase. The multifamily rental market will continue to grow, backed by the steady economy.

According to the Freddie Mac Multifamily Outlook we can expect 2016 to be another strong year for the multifamily housing market. “Favorable demographic trends and an improving economy will generate robust demand for multi-family properties. Even if the economy experiences extended low oil prices or slow near- growth over the next year, most multi-family markets will continue to perform above average.” 2016 should be another good year for those looking to focus their investments in the multifamily rental housing market. Although the amount of capital invested in multifamily rental housing has decreased slightly due to the slowing economy, it is still one of the top safe investments. The low vacancy rates in the industry are not expected to go any time soon. Rent growth will remain strong in 2016, but will not likely match what was experienced in 2015. 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.

2 | RubinBrown Apartment Stats 2016

COMPARISON OF OPERATIONS

Government Assisted

Market Rate

Total Number of Projects

425

31

Average Project Age In Years

10.10

12.11

Average Number of Units

109

266

Averages Per Unit: Monthly Rent

$750

$897

Square Feet

951

926

Rooms

4.41

3.60

Economic Occupancy

90.0%

87.3%

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

31.0%

50.3%

A

B

C

A

B

C

Revenues

Gross Potential Rent

$9,004

$9.47

100.0%

$10,763

$11.62

100.0%

Less: Vacancy Loss

(617)

(0.65)

-6.9%

(929)

(1.00)

-8.6%

Collection Loss

(167) (104)

(0.18) (0.11)

-1.9% -1.2%

(101) (334)

(0.11) (0.36)

-0.9% -3.1%

Concession Loss

Rent Collected

8,116

$8.53

90.0%

9,399

10.15

87.4%

353

0.37

3.9%

945

1.02

8.8%

Other Income Total Income

$8,469

$8.90

93.9%

$10,345

$11.17

96.2%

Expenses

Salaries and Personnel

$1,211

$1.27

13.5%

$1,044

$1.13

9.7%

Administrative

487

0.51

5.4%

480

0.52

4.5%

Marketing

62

0.07

0.7%

168

0.18

1.6%

Management Fees

471

0.50

5.2%

476

0.51

4.4%

Utilities

925

0.97

10.3%

648

0.70

6.0%

Carpeting

173

0.18

1.9%

90

0.10

0.8%

Painting

58

0.06

0.6%

66

0.07

0.6%

Landscaping

151

0.16

1.7%

105

0.11

1.0%

HVAC

71

0.07

0.8%

45

0.05

0.4%

Appliances

72

0.08

0.8%

32

0.03

0.3%

Plumbing

58

0.06

0.7%

42

0.04

0.4%

Electrical

49

0.05

0.5%

17

0.02

0.2%

Other Repairs and Services

1,047

1.10

11.6%

542

0.59

5.0%

Insurance

369

0.39

4.1%

279

0.30

2.6%

Real Estate Taxes

510 129

0.54 0.14

5.7% 1.4%

1,005

1.09 0.10

9.3% 0.9%

96

Other Taxes

Total Expenses

$5,844

$6.15

64.9%

$5,135

$5.54

47.7%

Net Operating Income Before Debt Service and Depreciation

$2,625

$2.75

29.0%

$5,208

$5.62

48.4%

Capital Expenditures

$405

$.43

4.5%

$973

$1.05

9.0%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

RubinBrown Apartment Stats 2016 | 3

GOVERNMENT ASSISTED

2015

2014

2013

Total Number of Projects

425

516

371

Average Number of Units

109

108

108

Averages Per Unit: Monthly Rent

$750

$735

$702

Square Feet

951

944

952

Rooms

4.41

4.46

4.34

Economic Occupancy

90.0%

89.1%

90.8%

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

31.0%

35.3%

36.3%

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$9,004

$9.47

100.0%

$8,816

$9.34

100.0%

$8,421

$8.85

100.0%

Less: Vacancy Loss

(617)

(0.65)

-6.9%

(744)

(0.79)

-8.4%

(597)

(0.63)

-7.1%

Collection Loss

(167)

(0.18)

-1.9%

(123)

(0.13)

-1.4%

(111)

(0.12)

-1.3%

Concession Loss

(104)

(0.11)

-1.2%

(93)

(0.10)

-1.1%

(67)

(0.07)

-0.8%

Rent Collected

8,116

8.53

90.0%

7,856

8.32

89.1%

7,646

8.03

90.8%

Other Income

353

0.37

3.9%

456

0.48

5.2%

400

0.42

4.8%

Total Income

$8,469

$8.90

93.9%

$8,312

$8.80

94.3%

$8,046

$8.45

95.6%

Expenses

Salaries and Personnel

$1,211

$1.27

13.5%

$1,068

$1.13

12.1%

$1,079

$1.13

12.8%

Administrative

487

0.51

5.4%

496

0.53

5.6%

469

0.49

5.6%

Marketing

62

0.07

0.7%

56

0.06

0.6%

52

0.05

0.6%

Management Fees

471

0.50

5.2%

467

0.49

5.3%

449

0.47

5.3%

Utilities

925

0.97

10.3%

827

0.88

9.4%

867

0.91

10.3%

All Repair, Maintenance and Contract Services

1,680

1.76

18.6%

1,386

1.48

15.7%

1,333

1.40

15.8%

Insurance

369

0.39

4.1%

348

0.37

4.0%

327

0.34

3.9%

Real Estate Taxes

510

0.54

5.7%

511

0.54

5.8%

467

0.49

5.5%

Other Taxes

129

0.14

1.4%

84

0.09

1.0%

82

0.09

1.0%

Total Expenses

$5,884

$6.15

64.9%

$5,243

$5.57

59.5%

$5,125

$5.37

60.8%

Net Operating Income Before Debt Service and Depreciation

$2,625

$2.75

29.0%

$3,069

$3.23

34.8%

$2,921

$3.08

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 2016

$1 = 0.0025”

dot = 0.1206“

1/2 dot =0.0603”

Average Monthly Rent per Unit

2012

2011

386

372

$1,000

107

105

$900

$750

$735

$800

$721

$702

$699

$699

$721

$700

932

964

$600

4.31

4.32

$500

2015

2014

2013

2012

2011

88.6%

89.4%

35.4%

40.0%

Economic Occupancy

100%

90%

A

B

C

A

B

C

80%

70%

$8,383

$8.99

100.0%

$8,653

$8.98

100.0%

60%

(758)

(0.81)

-9.0%

(704)

(0.73)

-8.1%

50%

(127)

(0.14)

-1.5%

(130)

(0.13)

-1.5%

40%

(79)

(0.08)

-0.9%

(84)

(0.09)

-1.0%

30%

7,419

7.96

88.6%

7,735

8.03

89.4%

375

0.40

4.5%

469

0.49

5.4%

20%

$7,794

$8.36

93.1%

$8,204

$8.52

94.8%

10%

0%

90.0% 2015

89.1%

90.8%

88.6%

89.4%

2014

2013

2012

2011

$1,031

$1.11

12.3%

$892

$0.93

10.3%

453

0.49

5.4%

454

0.47

5.2%

52

0.06

0.6%

102

0.11

1.2%

Gross Potential Rent vs. Net Operating Income per Square Foot

434

0.47

5.2%

444

0.46

5.1%

784

0.84

9.4%

831

0.86

9.6%

$2.75 $9.47

2015

1,428

1.54

17.0%

1,475

1.53

17.1%

$3.23 $9.34

2014

284

0.30

3.4%

350

0.36

4.0%

464

0.50

5.5%

514

0.53

5.9%

$3.08 $8.85

2013

103

0.11

1.2%

110

0.11

1.3%

$2.94 $8.99

2012

$5,033

$5.42

60.0%

$5,172

$5.36

59.7%

$3.16 $8.98

2011

$2,761

$2.94

33.1%

$3,032

$3.16

35.1%

NET OPERATING INCOME

GROSS POTENTIAL RENT

RubinBrown Apartment Stats 2016 | 5

GOVERNMENT ASSISTED

Expense Trends per Unit

$1,211

$1,068

Salaries and Personnel

$1,079

$1,031

$892

$549

$552

Administrative and Marketing

$521

$505

$556

$1,680

$1,386

Contract Services and Repairs & Maintenance

$1,333

$1,428

$1,475

$876

1,008

$945

Taxes and Insurance

$876

$851

$974

$0

$250

$500

$750

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

$1,750

2013

2012

2011

2015

2014

6 | RubinBrown Apartment Stats 2016

RubinBrown Apartment Stats 2016 | 7

GOVERNMENT ASSISTED BY REGION

North

East/Northeast

Midwest

South/Southeast

Total Number of Projects

21

57

218

74

Average Project Age In Years

10.7

12.4

10.2

9.1

Average Number of Units

96

115

107

103

Averages Per Unit: Monthly Rent

$661

$759

$727

$707

Square Feet

1009

935

894

1,008

Rooms

4.24

4.39

4.37

5.03

Economic Occupancy

92.2%

89.8%

87.6%

92.7%

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

21.8%

28.8%

30.5%

25.2%

A

B

C

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$7,941

$9.87 100.0%

$9,520 $10.18 100.0%

$8,724

$9.76 100.0%

$8,481 $8.41 100.0%

Less: Vacancy Loss

(468) (0.46)

-5.9%

(697) (0.74)

-7.7%

(742) (0.83)

-8.5%

(406) (0.40)

-4.8%

Collection Loss

(108) (0.11)

-1.4% -0.5%

(197) (0.21)

-2.2% -0.3%

(188) (0.21) (148) (0.17)

-2.2% -1.7%

(164) (1.16)

-1.9% -0.6%

(39) (0.04)

(29) (0.03)

(51) (0.05)

Concession Loss

Rent Collected

7,326

7.26

92.2%

8,597

9.19 0.46

90.3%

7,646

8.55 87.6%

7,860

7.80 0.35

92.7%

418 0.41

5.3%

430

4.7%

426

0.48

4.9%

350

4.1%

Other Income Total Income

$7,744

$7.67 97.5%

$9,027

$9.65 94.8%

$8,072

$9.03 92.5%

$8,210 $8.15 96.8%

Expenses

Salaries and Personnel

$1,073

$1.06

13.5%

$1,172

$1.25

12.9%

$1,216

$1.36

13.9%

$1,191

$1.18

14.0%

Administrative

574

0.57

7.2%

511

0.55

5.6%

484

0.54

5.5%

762

0.76

9.0%

Marketing

50

0.05

0.6%

128

0.14

1.4%

53

0.06

0.6%

47

0.05

0.6%

Management Fees

489

0.48

6.2%

515 0.55

5.7%

430

0.48

4.9%

489

0.49

5.8%

Utilities

987

0.98

12.4%

915

0.98

10.1%

861

0.96

9.9%

796

0.79

9.4%

Carpeting

181

0.18

2.3%

213

0.23

2.3%

173

0.19

2.0%

157 0.16

1.9%

Painting

23

0.02

0.3%

49

0.05

0.5%

58 0.06

0.7%

102

0.10

1.2%

Landscaping

137

0.14 1.7%

193

0.21

2.1%

106

0.12

1.2%

236

0.23

28%

HVAC

43

0.04 0.5%

89

0.09

1.0%

52

0.06

0.6%

131

0.13

1.5%

Appliances

31

0.03

0.4%

96

0.10

1.1%

60 0.07

0.7%

76 0.08

0.9%

Plumbing

55

0.05

0.7%

95

0.10

1.0%

42

0.05

0.5%

54 0.06

0.7%

Electrical

20

0.02

0.2%

44

0.05

0.5%

58

0.07

0.7%

31

0.03

0.4%

Other Repairs and Services

1,121

1.11

14.1%

1,086

1.14 11.7%

1,014

1.13

11.6%

1,096

1.09

12.9%

Insurance

300

0.30

3.8%

277

0.30

3.0%

391

0.44

4.5%

399

0.40

4.7%

Real Estate Taxes

761

0.75

9.6% 2.8%

687

0.73 0.07

7.5% 0.7%

483 128

0.54 5.5%

409 160

0.41 0.16

4.8% 1.9%

220 0.22

62

0.14

1.5%

Other Taxes

Total Expenses

$6,056

$6.00

76.3%

$6,132

$6.54 67.1%

$5,609

$6.27

64.3%

$6,139 $6.12

72.5%

Net Operating Income Before Debt Service & Depreciation

$1,688

$1.67

21.2%

$2,895

$3.10 30.4%

$2,463 $2.76

28.2%

$2,071

$2.03 24.3%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

8 | RubinBrown Apartment Stats 2016

Monthly Rent per Unit

South/Southwest

West/Northwest

25

30

$661

$793

9.9

8.5

120

1122

$870

$727

$768

$769

$870

$707

880

892

4.24

3.52

90.4%

97.6%

28.8%

31.9%

A

B

C

A

B

C

Net Operating Income per Square Foot

$1.67

$9,215 $10.47 100.0%

$10,440 $10.91 100.0%

$3.10

(736) (0.84)

-8.0%

(140) (0.16)

-1.4%

$4.58

(103) (0.12)

-1.1% -0.5%

(84) (0.09) (25) (0.03)

-0.8% -0.2%

$2.76

(45) (0.05)

$2.83

$2.03

8,331

9.46 0.38

90.4%

10,191

11.43 97.6%

338

3.7%

268

0.30 2.3%

$8,669

$9.84 94.1% $10,459 $11.73 99.9%

$1,282

$1.46

13.9%

$1,266

$1.42

12.1%

681

0.77 7.4%

616 0.69

5.9%

73 0.08

0.8%

20

0.02

0.2%

451

0.51 4.9%

579

0.65

5.5%

Economic Occupancy

1,120

1.27

12.2%

1,321 1.48

12.7%

126

0.14

1.4%

152 0.17

1.5%

92.2%

89.8%

26 0.03

0.3%

37

0.04

0.4%

126

0.14

1.4%

192

0.22

1.8%

97.6%

87.6%

67

0.08

0.7%

46

0.05

0.4%

76

0.09

0.8%

106

0.12 1.0%

90.4%

92.7%

33

0.04

0.4%

119

0.13

1.1%

18

0.02

0.2%

31 0.04 0.3%

950

1.08

10.3%

1,102

1.24 10.6%

405

0.46

4.4%

353

0.40

3.4%

598 0.68 142 0.16

6.5% 1.5%

302

0.34

2.9%

127 0.14 1.2%

$5,174 $7.01

67.1%

$6,369 $7.15

61.0%

West/Northwest

North

East/Northeast

$2,495

$2.83

27.0%

$4,090 $4.58

38.9%

South/Southwest

Midwest

South/Southeast

RubinBrown Apartment Stats 2016 | 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

125

119

96

42

43

Average Project Age In Years

8.3

9.6

11.2

12.7

12.1

Average Number of Units

32

73

116

165

274

Averages Per Unit: Monthly Rent

$653

$709

$767

$800

$769

Square Feet

1,060

916

900

943

921

Rooms

4.92

4.19

4.24

4.11

4.41

Economic Occupancy

94.3%

92.9%

90.1%

86.7%

88.0%

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

30.1%

26.6%

28.8%

28.4%

33.3%

A

B

A

B

A

B

A

B

A

B

Revenues

Gross Potential Rent

$7,836

$7.39

$8,513

$9.29

$9,198 $10.23

$9,599 $10.18

$9,226 $10.01

Less: Vacancy Loss

(136) (0.13)

(421) (0.46)

(606) (0.67)

(896) (0.95)

(770) (0.84)

Collection Loss

(160) (0.15)

(132) (0.14)

(143) (0.16)

(221) (0.23)

(186) (0.20)

Concession Loss

(159) (0.15)

(42) (0.05)

(154) (0.17)

(167) (0.18)

(158) (0.17)

Rent Collected

7,381

6.69

7,918 8.64

8,295

9.23

8,315 8.82

8,112

8.80

Other Income Total Income

448

0.42

309

0.34

382 0.42

593 0.63

186 0.20

$7,829

$7.38

$8,227

$8.98

$8,677

$9.65

$8,908

$9.45

$8,298 $9.00

Expenses

Salaries and Personnel

$936

$0.88

$1,427

$1.56

$1,250

$1.39

$1,272

$1.35

$1,073

$1.16

Administrative

678 0.64

646

0.71

593

0.66

558

0.59

437

0.47

Marketing

21 0.02

48

0.05

44

0.05

54

0.06

108 0.12

Management Fees

451

0.43

461

0.50

515

0.57

467

0.50

445

0.48

Utilities

731

0.69

834

0.91

1,101

1.22

1,030

1.09

829

0.90

Carpeting

67

0.06

180

0.20

190 0.21

177

0.19

193

0.21

Painting

39 0.04

67

0.07

50

0.06

58

0.06

66

0.07

Landscaping

111

0.11

182 0.20

175

0.19

144

0.15

124

0.13

HVAC

59

0.06

72

0.08

68

0.08

72

0.08

76

0.08

Appliances

36

0.03

61 0.07

95

0.08

67

0.07

92 0.10

Plumbing

21

0.02

48 0.05

84 0.09

75

0.08

48

0.05

Electrical

143

0.13

61 0.07

70

0.08

253

0.27

202

0.22

Other Repairs and Services

1,034 0.97

993 1.08

1,042

1.16

1,117 1.18

1,055

1.14

Insurance

468

0.44

352 0.38

336

0.37

391

0.41

368

0.40

Real Estate Taxes

536

0.51

458

0.50

459

0.51

530

0.56

576

0.63

Other Taxes

140

0.13

149

0.16

127

0.14

117

0.12

119

0.13

Total Expenses

$5,471

$5,16

$6,039

$6.59

$6,180

$6.86

$6,382

$6.76

$5,811

$6.31

Net Operating Income Before Debt Service and Depreciation

$2,358 $2.22

$2,188

$2.39

$2,497

$2.79

$2,526 $2.69

$2,487 $2.70

Capital Expenditures

$123

$0.12

$339

$0.37

$433

$0.48

$248 $0.26

$328

$0.36

A = Dollars per unit, per year

B = Dollars per square foot, per year

10 | RubinBrown Apartment Stats 2016

RubinBrown Apartment Stats 2016 | 11

MARKET RATE

2015

2014

2013

Total Number of Projects

31

38

45

Average Number of Units

266

279

263

Averages Per Unit: Monthly Rent

$897

$806

$780

Square Feet

926

942

909

Rooms

3.60

4.00

4.00

Economic Occupancy

87.3%

86.2%

85.8%

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

50.3%

47.8%

45.9%

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$10,763 $11.62 100.0%

$9,666

$10.26

100.0%

$9,358

$10.30

100.0%

Less: Vacancy Loss

(929)

(1.00)

-8.6%

(887)

(0.94)

-9.2%

(908)

(1.00)

-9.7%

Collection Loss

(101)

(0.11)

-0.9%

(90)

(0.10)

-1.0%

(121)

(0.13)

-1.3%

(334)

(0.36)

-3.1%

(349)

(0.37)

-3.6%

(303)

(0.33)

-3.2%

Concession Loss

Rent Collected

9,399 $10.15

87.4%

8,340

$8.85

86.2%

8,026

8.84

85.8%

945

1.02

8.8%

1,039

1.10

10.7%

1,088

1.20

11.6%

Other Income

$10,345 $11.17

96.2%

$9,379

$9.95

96.9%

$9,114

$10.04

97.4%

Total Income

Expenses

Salaries and Personnel

$1,044

$1.13

9.7%

$981

$1.04

10.1%

$939

$1.03

10.0%

Administrative

480

.52

4.5%

427

0.45

4.4%

438

0.48

4.7%

Marketing

168

.18

1.6%

139

0.15

1.4%

153

0.17

1.6%

Management Fees

476

.51

4.4%

395

0.42

4.1%

419

0.46

4.5%

Utilities

648

.70

6.0%

665

0.71

6.9%

664

0.73

7.1%

All Repairs and Maintenance and Contract Services

939

1.01

8.7%

1,035

1.10

10.7%

1,050

1.16

11.2%

Insurance

279

.30

2.6%

267

0.28

2.8%

311

0.34

3.3%

Real Estate Taxes

1,005

1.09

9.3%

900

0.95

9.3%

841

0.93

9.0%

96

0.10

0.9%

82

0.09

0.8%

120

0.13

1.3%

Other Taxes

Total Expenses

$5,135

$5.54

47.7%

$4,891

$5.19

50.5%

$4,935

$5.43

52.7%

Net Operating Income Before Debt Service and Depreciation

$5,208

$5.62

48.4%

$4,488

$4.76

46.4%

$4,179

$4.61

44.7%

A = Dollars per unit, per year

B = Dollars per square foot, per year

C = Percent of gross potential rent

12 | RubinBrown Apartment Stats 2016

Average Monthly Rent per Unit

2012

2011

34

35

$1,000

$897

248

246

$900

$806

$780

$766

$800

$674

$766

$674

$700

926

938

$600

4.14

4.20

$500

85.0%

88.6%

2015

2014

2013

2012

2011

49.0%

49.4%

Economic Occupancy

100%

A

B

C

A

B

C

90%

80%

70%

$9,193

$9.93

100.0%

$8,093

$8.63

100.0%

(824)

(0.89)

-9.0%

(438)

(0.47)

-5.4%

60%

(116)

(0.13)

-1.3%

(62)

(0.07)

-0.8%

50%

(435)

(0.47)

-4.7%

(420)

(0.45)

-5.2%

40%

7,818

8.44

85.0%

7,173

7.64

88.6%

30%

821

0.89

8.9%

630

0.67

7.8%

20%

$8,639

$9.33

93.9%

$7,803

$8.31

96.4%

10%

0%

86.2%

88.6%

87.3%

85.8%

85.0%

2015

2014

2013

2012

2011

$976

$1.05

10.6%

$762

$0.81

9.4%

305

0.33

3.3%

339

0.36

4.2%

127

0.14

1.4%

104

0.11

1.3%

350

0.38

3.8%

319

0.34

4.0%

Gross Potential Rent vs. Net Operating Income per Square Foot

596

0.64

6.5%

584

0.62

7.2%

1,054

1.14

11.6%

883

0.94

10.9%

$5.62 $11.62

2015

264

0.28

2.9%

233

0.25

2.9%

$4.76 $10.26

2014

690

0.75

7.5%

647

0.69

8.0%

$4.61 $10.30

2013

48

0.05

0.5%

76

0.08

0.9%

$4,410

$4.76

48.1%

$3,947

$4.20

48.8%

$4.57 $9.93

2012

$4,229

$4.57

45.8%

$3,856

$4.11

47.6%

$4.11 $8.63

2011

NET OPERATING INCOME

GROSS POTENTIAL RENT

RubinBrown Apartment Stats 2016 | 13

LOW INCOME TAX CREDIT PROJECTS

2015

2014

2013

Total Number of Projects

386

508

362

Average Number of Units

99

108

107

Averages Per Unit: Monthly Rent

$709

$735

$798

Square Feet

952

952

955

Rooms

4.42

4.51

4.36

Economic Occupancy

90.6%

88.9%

90.6%

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

30.6%

35.3%

36.5%

A

B

C

A

B

C

A

B

C

Revenues

Gross Potential Rent

$8,513

$8.94

100.0%

$8,824

$9.27

100.0%

$8,429

$8.83

100.0%

Less: Vacancy Loss

(580)

(0.61)

-6.8%

(757)

(0.79)

-8.6%

(617)

(0.65)

-7.3%

Collection Loss

(160)

(0.17)

-1.9%

(123)

(0.13)

-1.4%

(111)

(0.12)

-1.3%

(63)

(0.07)

-0.7%

(94)

(0.10)

-1.1%

(69)

(0.07)

-0.8%

Concession Loss

Rent Collected

7,710

8.09

90.6%

7,850

8.25

88.9%

7,632

7.99

90.6%

275

0.29

3.2%

450

0.47

5.1%

404

0.42

4.8%

Other Income

$7,985

$8.38

93.8%

$8,300

$8.72

94.0%

$8,036

$8.41

95.4%

Total Income

Expenses

Salaries and Personnel

$1,172

$1.23

13.8%

$1,071

$1.12

12.1%

$1,076

$1.13

12.8%

Administrative

452

0.47

5.3%

489

0.51

5.5%

457

0.48

5.4%

Marketing

57

0.06

0.7%

57

0.06

0.6%

51

0.05

0.6%

Management Fees

448

0.47

5.3%

467

0.49

5.3%

447

0.47

5.3%

Utilities

862

0.91

10.1%

818

0.86

9.3%

852

0.89

10.1%

All Repair, Maintenance and Contract Services

1,631

1.71

19.2%

1,531

1.61

17.3%

1,353

1.42

16.1%

Insurance

352

0.37

4.1%

349

0.37

4.0%

327

0.34

3.9%

Real Estate Taxes

451

0.47

5.3%

509

0.53

5.8%

463

0.49

5.5%

96

0.13

1.4%

82

0.09

0.9%

74

0.08

0.9%

Other Taxes

Total Expenses

$5,546

$5.82

65.2%

$5,373

$5.64

60.8%

$5,100

$5.35

60.6%

Net Operating Income Before Debt Service and Depreciation

$2,439

$2.56

28.6%

$2,927

$3.08

33.2%

$2,936

$3.06

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 2016

Average Monthly Rent per Unit

2012

2011

367

363

$1,000

109

106

$900

$798

$800

$735

$722

$709

$697

$697

$722

$700

947

952

$600

4.38

4.37

$500

88.8%

89.2%

2015

2014

2013

2012

2011

35.4%

36.9%

Economic Occupancy

100%

A

B

C

A

B

C

90%

80%

70%

$8,370

$8.84

100.0%

$8,665

$9.11

100.0%

(748)

(0.79)

-8.9%

(718)

(0.75)

-8.3%

60%

(129)

(0.14)

-1.5%

(130)

(0.14)

-1.5%

50%

(67)

(0.07)

-0.8%

(83)

(0.09)

-1.0%

40%

7,426

7.84

88.8%

7,734

8.13

89.2%

30%

373

0.39

4.4%

465

0.49

5.4%

20%

$7,799

$8.23

93.2%

$8,199

$8.62

94.6%

10%

0%

88.9%

89.2%

90.6%

90.6%

88.8%

2015

2014

2013

2012

2011

$1,031

$1.09

12.3%

$890

$0.94

10.3%

450

0.48

5.4%

453

0.48

5.2%

51

0.05

0.6%

102

0.11

1.2%

434

0.46

5.2%

444

0.47

5.1%

Gross Potential Rent vs. Net Operating Income per Square Foot

792

0.84

9.5%

829

0.87

9.6%

1,435

1.52

17.1%

1,476

1.55

17.0%

$2.56 $8.94

2015

282

0.30

3.4%

348

0.37

4.0%

$3.08 $9.27

2014

459

0.48

5.5%

518

0.54

6.0%

$3.06 $8.83

2013

103

0.11

1.2%

110

0.12

1.3%

$5,037

$5.33

60.2%

$5,170

$5.45

59.7%

$2.90 $8.84

2012

$2,762

$2.90

33.0%

$3,029

$3.17

34.9%

$3.17 $9.11

2011

NET OPERATING INCOME

GROSS POTENTIAL RENT

RubinBrown Apartment Stats 2016 | 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

· 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

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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

· Strategic planning · Feasibility studies

16 | RubinBrown Apartment Stats 2016

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.

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

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Amy Broadwater, CPA Partner 615.480.2871 amy.broadwater@rubinbrown.com

Jeff Cunningham, CPA Partner 303.952.1257 jeffrey.cunningham@rubinbrown.com

RubinBrown Apartment Stats 2016 | 17

Denver Office 1900 16th Street Suite 300 Denver, Colorado 80202 ph: 303.698.1883 Kansas City Office 1200 Main Street Suite 1000 Kansas City, Missouri 64106 ph: 816.472.1122 Nashville Office 3102 West End Avenue Suite 400 Nashville, Tennessee 37203 ph: 615.253.5200 St. Louis Office One North Brentwood Suite 1100 St. Louis, Missouri 63105 ph: 314.290.3300 St. Louis Cortex Office 4240 Duncan Avenue CIC@4240, Suite 200 St. Louis, Missouri 63110 ph: 314.290.3300

RubinBrown.com

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RubinBrown LLP

@RubinBrown

18 | RubinBrown Apartment Stats 2016