Loading...
HomeMy WebLinkAboutAppraisal - CBREAPPRAISAL REPORT JUNGLE ISLAND PROPOSED HOTEL 1111 Parrot Jungle Trail Miami, Miami -Dade County, Florida 33132 CBRE, Inc. File No. 18-397M1-0566 Mark Burns CITY OF MIAMI Lease Manager, Department of Real Estate & Asset Management 444 SW 2nd Avenue, 3rd Floor Miami, Florida 33130 www.cbre.com/valuation c CBRE CBRE HOTELS The World's Leading Hotel Experts. VALUATION & ADVISORY SERVICES CBRE Valuation & Advisory Services 5100 Town Center Circle, Tower II, Suite 600 Boca Raton, FL 33486-1021 T 305-381-6480 F 305-381-6462 www.cbre.com March 27, 2018 Mark Burns, CITY OF MIAMI Lease Manager, Department of Real Estate & Asset Management 444 SW 2nd Avenue, 3rd Floor Miami, Florida 33130 RE: Appraisal of the Jungle Island Proposed Hotel 1111 Parrot Jungle Trail Miami, Miami -Dade County, Florida 33132 CBRE, Inc. File No. 18-397M1-0566 Dear Mr. Burns: At your request and authorization, CBRE, Inc. has prepared an appraisal of the market value of the referenced property. Our analysis is presented in the following appraisal report. The subject is a proposed 300-room full -service hotel that will be adjacent to the existing Jungle Island theme park. The proposed property would be built on what is now a parking garage. Few specifics about the property exist at this time, but generally speaking the hotel will be approximately 300 rooms and will have approximately 30,000 SF of meeting space, a 3-meal casual restaurant and bar, approximately 10,000 SF of retail space, a fitness center and a business center. The property is planned to be a 3 or 4 star quality resort. The initial layout of the property would be approximately 9 stories high and would have approximately five levels of parking with a portion of that being below ground. The property is situated on Watson Island in the City of Miami and the property will be subject to a ground lease. The subject is more fully described, legally and physically, within the enclosed report. Based on the analysis contained in the following report, the market value of the subject is concluded as follows: 0 2018 CBRE, Inc. Mr. Mark Burns March 27, 2018 Page 2 MARKET VALUE CONCLUSION Appraisal Premise Interest Appraised Date of Value Value Conclusion As Is - Land Prospective As Complete Prospective As Stabilized Ground Rent Leasehold Interest March 20, 2018 $14,300,000 Leasehold Interest January 1, 2020 $76,600,000 Leasehold Interest January 1, 2022 $85,200,000 Leasehold Interest March 20, 2018 $1,215,500 Compiled by CBRE Based upon our analysis, it would appear that the proper percentage rent would be approximately 5.0% of the Gross Revenue generated at the proposed subject property. The value allocation of the subject has been concluded as follows: PROSPECTIVE AS COMPLETE VALUE ALLOCATION Interest Appraised - Allocation Value Conclusion Leasehold Interest As Complete Value $76,600,000 Personal Property $5,300,000 Business Enterprise Value $0 Real Property Value - As Complete $71,300,000 Compiled by CBRE The report, in its entirety, including all assumptions and limiting conditions, is an integral part of, and inseparable from, this letter. The following appraisal sets forth the most pertinent data gathered, the techniques employed, and the reasoning leading to the opinion of value. The analyses, opinions and conclusions were developed based on, and this report has been prepared in conformance with, the guidelines and recommendations set forth in the Uniform Standards of Professional Appraisal Practice (USPAP), the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. The intended use and user of our report are specifically identified in our report as agreed upon in our contract for services and/or reliance language found in the report. No other use or user of the report is permitted by any other party for any other purpose. Dissemination of this report by any party to non -client, non -intended users does not extend reliance to any other party and CBRE will not be responsible for unauthorized use of the report, its conclusions or contents used partially or in its entirety. CBRE 0 2018 CBRE, Inc. Mr. Mark Burns March 27, 2018 Page 3 It has been a pleasure to assist you in this assignment. If you have any questions concerning the analysis, or if CBRE can be of further service, please contact us. Respectfully submitted, CBRE - VALUATION & ADVISORY SERVICES Scott L. Webb, MAI Vice President — Hospitality Specialist Cert Gen RZ2002 Phone: (561) 393-1609 Fax: (561) 393-1650 Email: scott.webb@cbre.com James E. Agner, MAI, AI-GRS, SGA, MRICS Sr. Managing Director — Florida / Caribbean Cert Gen RZ382 Phone: (305) 381-6480 Fax: (305) 381-6462 Email: james.agner@cbre.com © 2018 CBRE, IrK. CBRE Certification Certification We certify to the best of our knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. 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. 3. We have no present or prospective interest in or bias with respect to the property that is the subject of this report and have no personal interest in or bias with respect to the parties involved with this assignment. 4. Our engagement in this assignment was not contingent upon developing or reporting predetermined results. 5. 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. 6. This appraisal assignment was not based upon a requested minimum valuation, a specific valuation, or the approval of a loan. 7. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice, as well as the requirements of the State of Florida. 8. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. 9. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 10. As of the date of this report, Scott L. Webb, MAI and James E. Agner, MAI have completed the continuing education program for Designated Members of the Appraisal Institute. 11. Scott L. Webb, MAI has and James E. Agner, MAI has not made a personal inspection of the property that is the subject of this report. 12. No one provided significant real property appraisal assistance to the persons signing this report. 13. Valuation & Advisory Services operates as an independent economic entity within CBRE, Inc. Although employees of other CBRE, Inc. divisions may be contacted as a part of our routine market research investigations, absolute client confidentiality and privacy were maintained at all times with regard to this assignment without conflict of interest. 14. Scott L. Webb, MAI and James E. Agner, MAI have provided services, as an appraiser regarding the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment. 4kitteL Scott Webb, MAI James E. Agner, MAI, AI-GRS, SGA, MRICS Cert Gen RZ2002 Cert Gen RZ382 CBRE © 20 18 CBRE, Inc. Subject Photographs Subject Photographs Aerial View 11 © 2018 CBRE, CBRE Subject Photographs [Aerial View CBRE © 2018 CBRE, Iric. Executive Summary Executive Summary Property Name Location Jungle Island Proposed Hotel 1111 Parrot Jungle Trail, Miami, Miami -Dade County, Florida 33132 Highest and Best Use As If Vacant Hotel As Improved Hotel Property Rights Appraised Leasehold Interest Date of Report March 26, 2018 Date of Inspection March 20, 2018 Estimated Exposure Time 9 Months Estimated Marketing Time 9 Months Land Area 2.40 AC Improvements Property Type Hotel (Resort) Number of Buildings 1 Number of Stories Gross Building Area 9 425,000 SF 104,369 SF Number of Rooms 300 Restaurant/Lounge Three meal a day casual restaurant and bar Meeting Space 4 breakout meeting rooms Total/Largest Meeting Space 30,000 SF (Total); 30,000 SF (Largest) Total Meeting Space Per Guest Room 100 SF Property Amenities Large swimming pool with a water slide, small convenience store, small retail store, business center, fitness center and 30,000 SF of meeting space. Year Built 2019 Condition Excellent Buyer Profile Investor -National VALUATION Market Value As Is On March 20, 2018 Land Value Market Value As Complete On Cost Approach Sales Comparison Approach Income Capitalization Approach Prospective Market Value As Stabilized On Cost Approach Sales Comparison Approach Income Capitalization Approach January 1, 2020 January 1, 2022 Total Per Hotel Room $14,300,000 $47,667 $71,000,000 $236,667 $76,600,000 $255,333 $76,600,000 $255,333 $77,100,000 $257,000 $82,700,000 $275,667 $85,200,000 $284,000 CONCLUDED MARKET VALUE Appraisal Premise Interest Appraised Date of Value Value As is - Land Prospective As Complete Prospective As Stabilized Ground Rent Leasehold Interest Leasehold Interest Leasehold Interest Leasehold Interest March 20, 2018 January 1, 2020 January 1, 2022 March 20, 2018 $14,300,000 $76,600,000 $85,200,000 $1,215,500 Compiled by CBRE iv CBRE Executive Summary STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS (SWOT) Strengths/ Opportunities • The subject is located on Watson Island within the Jungle Island Park and has excellent views of Biscayne Bay; • The subject is located near the Miami Beach and the Miami CBD; • The subject is located in a hotel market with strong occupancies and ADR; • The subject would be the only existing hotel on Watson Island which also has a marina and a Children's Marina within close proximity; • The subject should benefit from the anticipated improved economic climate that is projected in the next couple of years. Weaknesses/ Threats • The property is located in a very competitive hotel market with most of the major franchises represented in the submarket; • The submarket has planned new hotel construction that is not considered to be competitive to the subject; EXTRAORDINARY ASSUMPTIONS An extraordinary assumption is defined as "an assignment -specific assumption as of the effective date regarding uncertain information used in an analysis, which if found to be false, could alter the appraiser's opinions or conclusions."' • Our "As Complete" value opinion represents a prospective value conclusion based on the extraordinary assumption that the proposed improvements are constructed in the timeframes described in this report, per the descriptions provided, and with quality workmanship described. The appraiser cannot be held responsible for unforeseeable events that may alter market conditions subsequent to the effective date of the appraisal. • Our "As Stabilized" value opinion represents a prospective value conclusion based on market conditions forecast as of the effective date of the appraisal. The appraiser cannot be held responsible for unforeseeable events that may alter market conditions subsequent to the effective date of the appraisal. • Due to the very preliminary nature of the subject and the lack of building plans, we have made a significant number of assumptions concerning the physical characteristics of the subject property. If our assumptions are significantly different than we have assumed, it may change the conclusions reached in this report. • We have assumed that the subject property is specifically approved by the City Commission of Miami. • The use of these extraordinary assumptions may have affected the assignment results. 1 The Appraisal Foundation, USPAP, 2018-2019. v 02018 CBRE, Inc. CBRE Executive Summary HYPOTHETICAL CONDITIONS A hypothetical condition is defined as "a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purposes of analysis." 2 • None Noted. 2 The Appraisal Foundation, USPAP, 2018-2019. vi © 2018 CBRE, 8K. CBRE Table of Contents Table of Contents Certification Subject Photographs Executive Summary iv Table of Contents vii Introduction 1 Area Analysis 5 Neighborhood Analysis 9 Site Analysis 13 Improvements Analysis 14 Zoning, 15 Tax and Assessment Data 16 Market Analysis 18 Highest and Best Use 31 Appraisal Methodology 33 Land Value 34 Cost Approach 36 Sales Comparison Approach 40 Income Capitalization Approach 43 Reconciliation of Value 58 Real Property Value Allocation 59 Ground Rent Estimate 62 Assumptions and Limiting Conditions 66 ADDENDA A Improved and Land Sale Data Sheets B Smith Travel Research Report C Legal Description D Engagement Letter E Qualifications vii 0 2018 CBRE, Inc. CBRE Introduction Introduction OWNERSHIP AND PROPERTY HISTORY Title to the property is currently vested in the name of City of Miami. However, a long-term lease was recently granted to ESJ Capital Partners for approximately $60,000,000. This is according to the operators of the park along with media accounts. The transfer was approved by the City of Miami. ESJ JI Leasehold is the legal entity, who is an affiliate of Aventura-based commercial real estate firm ESJ Capital Partners, led by Arnaud Sitbon and Gabriel Amiel. The current lease runs through 2060, however, the developer is petitioning the city to extend the lease to 2099. To the best of our knowledge there have been no ownership transfers of the property during the previous three years. INTENDED USE OF REPORT This appraisal is to be used by the client (City of Miami) to assist them in internal decision making purposes, and no other use is permitted. INTENDED USER OF REPORT This appraisal is to be used by City of Miami, and no other user may rely on our report unless as specifically indicated in the report. Intended Users - the intended user is the person (or entity) who the appraiser intends will use the results of the appraisal. The client may provide the appraiser with information about other potential users of the appraisal, but the appraiser ultimately determines who the appropriate users are given the appraisal problem to be solved. Identifying the intended users is necessary so that the appraiser can report the opinions and conclusions developed in the appraisal in a manner that is clear and understandable to the intended users. Parties who receive or might receive a copy of the appraisal are not necessarily intended users. The appraiser's responsibility is to the intended users identified in the report, not to all readers of the appraisal report. 3 PURPOSE OF THE APPRAISAL The purpose of this appraisal is to estimate the market value of the subject property and the market ground lease rent. DEFINITION OF VALUE The current economic definition of market value agreed upon by agencies that regulate federal financial institutions in the U.S. (and used herein) is as follows: 3 Appraisal Institute, The Appraisal of Real Estate, 14th ed. (Chicago: Appraisal Institute, 2013), 50. CBRE 02018 CBRE, Inc. Introduction The most probable price which 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 specified date and the passing of title from 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. 4 EXPOSURE/MARKETING TIME The exposure/marketing time is a function of price, time, and use. It is not an isolated estimate of time alone. In consideration of these factors, we have analyzed the following: EXPOSURE/MARKETING TIME DATA Investment Type Exposure/Mktg. (Months) Range Average Comparable Sales Data PWC Real Estate Investment Survey Hotels: 1st Qtr. 2018 Luxury Full Service Limited Service Select Service Local Market Professionals CBRE Exposure Time Estimate CBRE Marketing Period Estimate 2.0 - 24.0 10.3 3.0 - 12.0 6.8 3.0 - 9.0 6.0 2.0 12.0 6.7 2.0 - 15.0 6.6 6.0 - 12.0 9.0 9 Months 9 Months PwC Real Estate Investor Survey INTEREST APPRAISED The value estimated represents the Leasehold Interest and is defined as follows: Leasehold Interest - The tenant's possessory interest created by a lease. 5 4 Interagency Appraisal and Evaluation Guidelines; December 10, 2010, Federal Register, Volume 75 Number 237, Page 77472. 5 Dictionary of Real Estate Appraisal, 113. 2 02018 CBRE, Inc. CBRE Introduction SCOPE OF WORK This Appraisal Report is intended to comply with the reporting requirements set forth under Standards Rule 2 of USPAP. The scope of the assignment relates to the extent and manner in which research is conducted, data is gathered and analysis is applied. CBRE, Inc. completed the following steps for this assignment: Extent to Which the Property is Identified The property is identified through the following sources: • postal address • assessor's records • legal description Extent to Which the Property is Inspected CBRE, Inc. inspected the subject site and the surround environs on 3/20/2018. Type and Extent of the Data Researched CBRE reviewed the following: • applicable tax data • zoning requirements • flood zone status • demographics • income and expense data industry averages • comparable data Type and Extent of Analysis Applied CBRE, Inc. analyzed the data gathered through the use of appropriate and accepted appraisal methodology to arrive at a probable value indication via each applicable approach to value. The steps required to complete each approach are discussed in the methodology section. 3 0 2018 CBRE, Inc. CBRE Introduction Data Resources Utilized in the Analysis DATA SOURCES Item: Source(s): Site Data Size Improved Data Building Area No. Bldgs. Parking Spaces Year Built/Developed Economic Data Deferred Maintenance: Building Costs: Income Data: Expense Data: Public Records Preliminary Specs Preliminary Specs Preliminary Specs Preliminary Specs N/A Subject Comparable Construction Costs and MVS Subject Pro Forma, STR and CBRE Hotels Trends Subject Pro Forma, STR and CBRE Hotels Trends Compiled by CBRE 4 CBRE Area Analysis Area Analysis 'ris Pa Miami Lakes ail, Hialeah floral 87d Kendall Palmetto Bay C3 Aventura aril Beach iami Beach Miami Key Biscayne Moody's Economy.com provides the following Miami -Miami Beach -Kendall, FL metro area economic summary as of Nov-17. MIAMI -MIAMI BEACH-KENDALL, FL - ECON OM IC IN DICATORS Indicators 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Gross Metro Product (C09$ Bil) %Change Total Employment (Ths) %Change Unemployment Rate (%) Personal Income Growth (%) Median Household Income ($ Ths) Population (Ths) Change Net Migration (Ths) Single -Family Permits (#) Multifamily Permits (# ) Fhfa House Rice (1995Q1= 100) 105.0 0.2 1,007.3 2.2 9.4 4.8 41.9 2,573.4 2.6 52.6 962.0 1,656.0 182.8 106.2 1.2 1,031.3 2.4 8.3 2.6 42.2 2,608.0 1.3 21.5 1,819.0 3,250.0 185.7 108.3 2.0 1,056.5 2.4 7.5 0.4 42.6 2,641.3 1.3 20.1 2,266.0 8,050.0 207.5 110.8 2.3 1,089.3 3.1 6.8 7.8 43.2 2,667.3 1.0 14.2 2,077.0 5,654.0 232.9 114.5 3.3 1,125.8 3.4 5.9 6.4 44.6 2,692.6 0.9 11.8 2,800.0 9,817.0 256.0 117.4 2.6 1,157.7 2.8 5.4 2.2 45.9 2,712.9 0.8 11.3 2,873.0 6,444.0 281.6 119.6 1.9 1,177.5 1.7 4.9 4.8 46.8 2,750.5 1.4 27.8 2,320.9 7,872.1 304.4 125.2 4.7 1,197.5 1.7 4.1 5.9 48.7 2,789.5 1.4 29.3 3,646.6 4,029.4 313.8 132.1 5.5 1,217.6 1.7 4.1 7.0 50.9 2,828.6 1.4 29.5 5,729.2 4,007.7 310.7 135.8 2.8 1,223.7 0.5 4.8 6.1 52.7 2,867.3 1.4 29.3 6,499.1 4,706.5 304.1 141.5 4.3 1,231.8 0.7 5.4 5.7 54.3 2,904.5 1.3 28.0 6,925.9 5,440.2 300.1 147.4 4.2 1,248.4 1.3 5.4 5.8 56.2 2,941.6 1.3 28.2 7,040.0 6,204.9 300.1 Source: Moody's Economy.com RECENT PERFORMANCE The expansion in Miami -Miami Beach -Kendall is waning. Though the metro division's unemployment rate has fallen to its lowest since 2008, it has held steady for four months. Wage 5 © 2018 CBRE, Inc. CBRE Area Analysis growth over the last six months has been nonexistent because MIA is swapping high -paying jobs in goods -producing industries for lower -paying jobs in the service sector. Year -over -year house price appreciation has fallen short of the U.S. rate for the last seven months, reversing a streak that had lasted for six years. STRONG DOLLAR The U.S. dollar will strengthen against most world currencies over the next two years as the Federal Reserve normalizes monetary policy, and the effect of this appreciation on MIA will be mixed. A strong dollar makes U.S. goods and services more expensive for foreign consumers and visitors but makes overseas products and vacations cheaper for Americans. This shift favors trade through PortMiami, where import shipments outweighed exports by 30% in 2016, and it greatly favors activity at Port Everglades in nearby Fort Lauderdale, where imports are nearly twice as large as exports. However, tourism falters as a result of the stronger dollar. MIA is the second most popular destination for overseas travelers, after New York City, but the number of international visitors to MIA and across the U.S. shrank last year. This trend is likely to be extended this year and next. A rising dollar also hurts housing in MIA. Florida is the top -ranked state for international buyers, and more than half of these shoppers purchase property in South Florida, which includes MIA, Fort Lauderdale, and West Palm Beach. Unfavorable exchange rates may already be taking a toll. In the latest report, year -over -year sales for single-family housing declined by 14% in South Florida, the biggest drop in the state. INTERNATIONAL APPEAL Over the longer term, MIA's economy will grow faster than the nation's because the metro division attracts some of the most talented and productive workers from across the Western Hemisphere. MIA is the only metro area or division in the U.S. where more than half of the population was born in a foreign country, and more than 90% of these newcomers were born in Latin America, which includes Cuba. Over the last two generations, these migrants have transformed MIA from a sleepy retiree destination to the cultural, financial and media capital of Spanish-speaking America. This growth should carry on, but hostility to trade and immigration among the American electorate and the Trump administration represents a new threat to MIA's economy. THE 3R:IGH T ALINE New rail service promises to bring economic development to downtown. Within the next few months, the Brightline will inaugurate passenger service between MIA, Fort Lauderdale, and West Palm Beach. Construction is nearly complete on the crown jewel, 11-acre MiamiCentral station, where the Brightline will connect with MIA's other inter- and intra-city rail systems. When the full route is operational, 16 daily trains will shuttle riders around South Florida in less than one hour and then to Orlando International Airport in about three hours. However, progress on 6 02018 CBRE, Inc. CBRE Area Analysis the West Palm Beach -to -Orlando leg is held up and at risk because of a legal dispute between the parent company and two counties along the route. CONCLUSION Unfavorable exchange rates will hamper tourism but boost trade in Miami -Miami Beach -Kendall in the short run. Over the forecast horizon, MIA's international character, combined with its high - skilled, bilingual workforce, will help it best the U.S. in household income growth. 7 © 2018 CBRE, IrK. CBRE Area Analysis several years. As a result, the demand for existing and future developments is expected to be good. Generally, the neighborhood is expected to show a relatively strong growth pattern as the economy continues to improve. In the long term the area is expected to remain a desirable tourist, office, retail and residential and area with the ability to experience good appreciation in the foreseeable future. 8 © 2018 CBRE, IrK. CBRE Neighborhood Analysis Neighborhood Analysis 1�9'I t LE HAITI 944 (.n rn "Cd 176 It. L5 . • WYN OO11 r#r 39S w ■ . ■ 1 ■ E}DJNT▪ IFJ lade Island M1th.... r . ■.. ". • . Miami Fisher Islit and a . N, 1 •REV pi ■ R . E Mimi Beach I..in■s .ems �. . t • . Viira nIa Fey (A 1 A'`tr Miami fah SOUTH BE( " ■ 1 LOCATION The neighborhood consists of Watson Island, which is located in the city of Miami and is considered an urban location. Watson Island is located on the west side of Biscayne Bay in close proximity to the Miami CBD, the Port of Miami and the sports and retail complex which comprises Bayfront Park and the American Airlines Arena. The city of Miami is located in Miami - Dade County, in southeastern Florida. Boundaries The neighborhood boundaries are detailed as follows: North: Biscayne Bay and the Venetian Causeway South: Biscayne Bay and the Port of Miami 9 02018 CBRE, Inc. CBRE Neighborhood Analysis East: The MacArthur Causeway and Miami Beach West: Biscayne Boulevard LAND USE Watson Island consists of a small, 86-acre, diamond -shaped spoil island that was created in the first part of the last century when the ship channels for the adjacent Port of Miami were dug. It is one of several islands situated between the Miami mainland and the Miami Beach barrier island. Most of the islands in this area were created by the dredging of Biscayne Bay in the early part of the last century as part of the creation of causeway access to and the development of south Miami Beach. Most of these islands have been fully developed, and are now long-established, upscale residential neighborhoods commanding some of the highest home prices in the Miami area. Watson Island is owned by the City of Miami and for many years was largely undeveloped. The island was given to the City by the State of Florida in 1949 for public use and is deed restricted. The State, through a Trust, oversees such public lands, and must grant waivers for any commercial development on the lands. In the case of Watson Island, the State receives a negotiated percentage of any rents paid to the City derived from commercial enterprises constructed on the Island. Much of the island currently is zoned for recreation and open space. Apart from minor boat marina operations, a visitor's center and aviation base for charter helicopter rides and Chalk Airways (a water -landing aircraft company); it was not until the development of Parrot Island Jungle that Watson Island began to emerge as a setting for the expansion of the City of Miami's commercial and recreational interests. The island is home to Jungle Island. Jungle Island, (formerly Parrot Jungle) is an interactive zoological park on Watson Island. The park was originally named Parrot Jungle and moved from its original suburban Pinecrest to its present location just east of Downtown Miami renamed as Parrot Jungle Island. In 2007, the park was again renamed to Jungle Island. Jungle Island was completed in 2003, followed by the Miami Children's Museum in 2005. The Miami Children's Museum is a 56,500-square-foot, designed by Arquitectonica. It includes 14 permanent galleries, pre-school classrooms, parent/teacher resource center, Kid Smart educational gift shop, a 200-seat auditorium and a Subway restaurant. The museum offers hundreds of bilingual, interactive exhibits; programs and classes and learning materials related to arts, culture, community and communication. Additional development on the island currently includes the Miami Yacht Club, which has been located on Watson Island since the late 1940s. It offers youth and adult sailing programs, and sponsors races, regattas and a Sea Scout ship. The club has boat slips, dry storage, and a lounge, bar and restaurant. The Ichimura-Miami Japanese Garden is located just west of the subject site. The Japanese Gardens were relocated from the Parrot Island Jungle main parcel to a site at the eastern 10 02018 CBRE, Inc. CBRE Neighborhood Analysis border of the Parrot Island parcel. There is currently no residential development on the island. The new operators of the subject property intend to do a major renovation on the Jungle Island portion of the parcel along with building the proposed subject hotel. Also, of special mention is the recent completion of the Port of Miami Tunnel. The tunnel consists of two tubes featuring two lanes each. The entire project completed in May of 2014. The tunnel project cost approximately $1 billion and was done in concert with the new Port of Miami rail project and dredging project in anticipation of the Panama Canal expansion. The only other planned project on the island is a large commercial use envisioned for Watson Island. To be built on 10.8 acres of upland and 13.65 acres of submerged land, "Island Gardens" is to include two hotel towers (48 and 37 stories), over 400,000 square feet of retail space including waterfront restaurants, a 50-slip yacht marina, and a resort spa. The site is located on the northwestern tip of Watson Island on land leased from the City of Miami on a 75- year ground lease that was negotiated with the City in 2001 and commenced in 2010. The developer, Flagstone Property Group had a master plan that includes 6.5 acres of open space. While the project was started, it is now on hold with the City of Miami for non- performance. The City Commission voted to rescind the approval after the developer was unable to break ground on the main part of the development. The marina was substantially approved and the project is currently in limbo and both parties have declared the other is in default. Litigation is like to follow. ACCESS Watson Island is accessed by means of the MacArthur Causeway. The MacArthur Causeway connects to Interstate 395 immediately to the west of Watson Island where it links up to Interstate 95, a major, north -south Interstate Highway. To the east, MacArthur Causeway becomes State Route 41, connecting with A1A on south Miami Beach. Crossing Biscayne Bay on the MacArthur Causeway from west to east are the landfill islands of Watson Island, Palm Island, Star Island, Watson Island (the lesser and home of the US Coast Guard Station) and Terminal Island. MacArthur Causeway becomes 5th Street (or A1A) as it enters south Miami Beach. Fisher Island, a high -end residential community is accessed via Ferry service from the US Coast Guard Station located at the eastern end of the MacArthur Causeway. DEMOGRAPHICS Selected neighborhood demographics in 1-, 3-, and 5-mile radii from the subject are shown in the following table: 11 0 2018 CBRE, Inc. CBRE Neighborhood Analysis SELECTED NEIGHBORHOOD DEMOGRAPHICS 1111 Parrot Jungle Trail 1 Mile 3 Mile 5 Mile Miami, Florida 33132 Radius Radius Radius Population 2017 Population 6,922 209,661 454,476 2022 Population 7,773 228,339 486,864 2010 Population 5,013 175,014 403,361 2000 Population 2,341 144,133 371,536 Annual Growth 2017 - 2022 12.29% 8.91% 7.13% Annual Growth 2010 - 2017 27.58% 16.53% 11.25% Annual Growth 2000 - 2010 114.14% 21.43% 8.57% Households 2017 Households 4,082 102,010 192,329 2022 Households 4,583 111,489 206,429 2010 Households 2,942 83,832 169,100 2000 Households 1,229 65,217 147,557 Annual Growth 2017 - 2022 12.27% 9.29% 7.33% Annual Growth 2010 - 2017 27.93% 17.82% 12.08% Annual Growth 2000 - 2010 139.38% 28.54% 14.60% Income 2017 Average Household Income $114,330 $73,105 $63,959 2017 Median Household Income $77,320 $43,017 $36,495 2017 Per Capita Income $67,589 $36,432 $27,672 Source: ESRI CONCLUSION The long-term outlook for the neighborhood is for good performance with moderate new construction over the next several years. As a result, the demand for existing and future developments is expected to be good. Generally, the neighborhood is expected to show a relatively strong growth pattern as the economy continues to improve. In the long term the area is expected to remain a desirable tourist, office, retail and residential and area with the ability to experience good appreciation in the foreseeable future. 12 0 2018 CBRE, Inc. CBRE Site Analysis Site Analysis The following chart summarizes the salient characteristics of the subject site. SITE SUMMARY AND ANALYSIS Physical Description Gross Site Area (Entire Development) 2.40 Acres 104,369 Sq. Ft. Net Site Area (Entire Development) 2.40 Acres 104,369 Sq. Ft. Primary Road Frontage MacArthur Causway Secondary Road Frontage Biscayne Bay Shape Irregular Topography Level Zoning District CS - Civic Space Zoning Flood Map Panel No. & Date 12086C0316L 11-Sep-09 Flood Zone Zone AE Adjacent Land Uses Museum and Marina Earthquake Zone N/A Comparative Analysis Rating Visibility Good Functional Utility Good Traffic Volume Good Adequacy of Utilities Assumed adequate Landscaping Average Drainage Assumed adequate Utilities Provider Adequacy Water City of Miami Yes Sewer City of Miami Yes Natural Gas Private Vendors Yes Electricity FP&L Yes Telephone AT&T Yes Other Yes No Unknown Detrimental Easements X Encroachments X Deed Restrictions X Reciprocal Parking Rights X Source: Various sources compiled by CBRE ENVIRONMENTAL ISSUES CBRE, Inc. is not qualified to detect the existence of potentially hazardous material or underground storage tanks which may be present on or near the site. The existence of hazardous materials or underground storage tanks may affect the value of the property. For this appraisal, CBRE, Inc. has specifically assumed that the property is not affected by any hazardous materials that may be present on or near the property. 13 CBRE Improvements Analysis Improvements Analysis The following chart shows a summary of the proposed improvements. IMPROVEMENTS SUMMARY AND ANALYSIS Property Type Hotel (Resort) Number of Buildings 1 Number of Stories 9 Gross Building Area (Estimated by Appraiser) 425,000 SF Number of Guest Rooms 300 Restaurant/Lounge Bar with limited hours and food offerings Meeting/ Banquet Rooms Approximately 30,000 SF of meeting space Effective Age 0 Years Site Coverage 47.9% Parking Spaces: 815 spots contained in a multi -level parking garage Year Built 2019 Actual Age 0 Years Effective Age 0 Years Total Economic Life 55 Years Remaining Economic Life 55 Years Age,/Life Depreciation 0.0% Functional Utility Typical Improvement Summary Description Comparative Rating Good Avg. Fair Poor Foundation Reinforced concrete X Frame Concrete block X Exterior Walls Painted masonry & glass X Interior Walls Textured and painted drywall X Roof Built-up composition X Ceiling Textured and painted drywall X HVAC System Central air in public areas and individual air handlers in guest rooms X Exterior Lighting Mercury vapor fxtures X Interior Lighting Recessed fluorescent fxtures X Flooring Ceramic tile and wood lamenate X Plumbing Assumed adequate X Elevators,/Stairwells 3 Elevators and 2 stairways X Life Safety and Fire Sprinklered and smoke detectors X Protection Parking 815 in parking garage X Landscaping Grass, gravel and natural forest courtyards with irrigated X planted beds Source. Various sources compiled by CBRE Only preliminary specifications such as number of hotel rooms, numbers of stories, amount of meeting space, amount of retail/restaurant space etc. were provided to the appraiser. Therefore, we have relied on our experience with typical finishes and construction materials utilized on properties of similar quality and orientation as the subject for our analysis. The following is a description of the subject improvements and basic construction features derived from the general specifications provided and our conversations with representatives of the potential operator of the hotel. YEAR BUILT The subject is proposed to be built in 2020 and will be in excellent condition upon completion. CONCLUSION The proposed improvements appear to be well planned and are considered functional in regard to improvement design and layout. Overall, there are no known factors that could be considered adverse in impact to the marketability of any of the subject guestrooms or the overall property. 14 © 201 8 CBRE, Inc. CBRE Zoning Zoning, The following chart summarizes the subject's zoning requirements. ZONING SUMMARY Current Zoning Legally Conforming CS - Civic Space Zoning Currently not allowed, but could be if approved through spectial approval process Uses Permitted The civic zone consists of public use space and faciliities that may contrast in use to their surrounding while reflecting Setbacks and landscape. Zoning Change Would be required Source: Planning & Zoning Dept. The proposed subject improvements would not currently be a legal, conforming use. However, according to Mark Burns at the City of Miami, there is a special process that is available to change the zoning on the site. This would involve specific approval by the City Commission of Miami. Final construction plans (when prepared) would need to be approved through the planning and zoning process of the City of Miami. ANALYSIS AND CONCLUSION The improvements (if approved by the City of Miami Commission) would represent a legal, conforming use. However, it is not a permitted use at this time. We assume that all necessary permits have been secured, including an appropriate liquor license (if required), and that the subject is in conformance with all local building codes and other applicable regulations. If additional information is required, please contact the local planning and/or zoning office. 15 0 2018 CBRE, Inc. CBRE Tax and Assessment Data Tax and Assessment Data The following summarizes the local assessor's estimate of the subject's market value, assessed value, and taxes, and does not include any furniture, fixtures or equipment. The CBRE estimated tax obligation is also shown. AD VALOREM TAX INFORMATION Assessor's Market Value Parcel Description 01-3231-000-0014 Part of Larger Parcel Total Assessor's Market Value 2017 $7,708,008 $7,708,008 Assessed Value @ 100% $7,708,008 General Tax Rate (per $1,000 A.V.) 21.8256 General Tax: $168,232 Less 4% Discount (6,729) Total Taxes $161,503 Source: Assessor's Office We have analyzed the 2017 assessment and the millage rates. The subject is part of a much larger property, and as such we would expect the Miami -Dade County Property Appraiser would assign a new tax folio to the subject once the hotel is complete. The next re -assessment of the subject is scheduled for 2018; however the sale of the property would likely initiate an immediate reassessment for the following year. The statement above does not take into account a potential 4% discount if the taxes are paid early. We believe a reasonable investor would take advantage of this discount. DELINQUENCY According to a representative of the Miami -Dade County Property Appraiser, there are no delinquent property taxes encumbering the subject. It should be noted that while the property assessments are supposed to be at 100% of market value, however, they usually range from 70% to 80% of the market value. The subject assessment is currently at approximately 10% of our "As Complete" Market Value. Therefore we have utilized a projected assessment near the middle of the normal range (75%) to account a potential purchaser's viewpoint. In the remaining years of our analysis, we have utilized the estimated tax basis for year one and inflated this amount by 3.0% for each year thereafter. Additionally, Florida allows for a 4% discount if taxes are paid early. Most reasonable investors would take advantage of this 16 0 2018 CBRE, Inc. CBRE Tax and Assessment Data discount by paying the tax amounts a couple of months early. As such, the estimated tax liability for the subject is estimated as follows: AD VALOREM TAX INFORMATION Assessors Market Value Parcel Description 2017 01-3231-000-0014 $7,708,008 Total Assessors Market Value $7,708,008 Pro Forma Hotel $57,450,000 Assessed Value @ 100% 100% $7,708,008 $57,450,000 General Tax Rate (per $1,000 A.V.) 21.8256 21.8256 Total Taxes $168,232 $1,253,881 Less: Adjustment for Early Payment of 4%-$6,729 -$50,155 $161,503 $1,203,725 Source: Assessor's Office CONCLUSION Based on the foregoing, the total taxes for the subject have been estimated as $1,203,725 for the base year of our analysis, based upon 75% of the "As Complete" Market Value of $76,600,000 arrived at in this report. This is higher than the current and historical assessment but is considered a realistic scenario due to the estimated market value utilized in this report. For purposes of this analysis, CBRE, Inc. assumes that all taxes are current. 17 © 2018 CBRE, IrK. CBRE Tax and Assessment Data Market Analysis Understanding the relationship between supply and demand is a critical component of any appraisal, particularly with respect to hotels. Unlike other property types, hotels essentially lease their rooms on a daily basis. While this characteristic allows for an immediate response to changes in market conditions, it also requires a high level of management intensity. There is an inverse relationship between occupancy and average daily rate (ADR), and raising or lowering rates typically has an immediate impact on room -nights sold. Effective management entails finding the proper balance that allows for the maximization of revenue. In this section we first identify the Subject property's competitive set (e.g., those hotels that tend to compete for the same sources of demand). We then identify relevant demand sources, analyze historical growth patterns and assess the potential for growth (or lack thereof) in demand by segment. The result is a projection of future market performance. Lastly, we conclude with a projection of occupancy and ADR for the Subject property, taking into consideration its competitive strengths and weaknesses relative to the overall market. Some hotels are more directly competitive than others based on their locations, facilities, branding, etc. This disparity in the level of competitiveness can be handled in a number of ways. Some appraisers assign a percentage to each property and include only a portion of their guest rooms in the competitive set. This technique, while theoretically sound, is highly subjective and the overall analysis can be extremely sensitive to the assumptions made. Alternatively, we have chosen to address this issue through our projected penetration rates. For example, the introduction of a new property that is only marginally competitive will have a limited impact on the Subject property's penetration level, whereas a directly competitive property will likely have a substantial effect. Regardless of the method employed, properly assessing the relationship between supply and demand and its impact on the Subject property and market occupancy requires a level of professional judgment. 18 0 2018 CBRE, Inc. Tax and Assessment Data NATIONAL OVERVIEW Hotel Market Summary The U.S. 'lodging industry will enjoy continued growth in all major metrics in 2018, albeit at a slower pace. Based on the recently released September 2017 editions of Hotel Horizons®, CBRE Hotels' Americas Research is forecasting year -over -year increases in occupancy, average daily room rate (ADR), rooms revenue (RevPAR), total operating revenue, and gross operating profits (GOP) from 2017 to 2018. TEAR OCC A OCC ADR A ADR REVPAR A REVPAR 2012 2013 2014 2015 2016 2017E 2018F 2019F 2020F 2021F 61.4% 62.2% 64.4% 65.4% 65.4% 65.6% 65.7% 65.2% 64.8% 65.4% 2.4% 1.4% 3.4% 1.6% 0.1% 0.3% 0_l% - 0.7% - 0.7% 1.0% S106.02 S110.01 S115.13 S120.33 S124.07 S127.16 S130.11 S132.58 S134.97 S138.48 42% 3.8% 4.7% 4.5% 3.1% 2.5% 2.3% 1.9a/a 1.8% 2.6% S65.10 S68.48 S74.09 S78.66 S81.16 S83.44 S85.43 S86.46 S87.40 S90.59 Source: CBRE Hotels' Americas Research, STR, 02 2017 6.7°/a 5.2% 8.2% 6.2% 3.2% 2.8% 2.4% 1.2% 3.6°k Occupuucy dmrpong tell remain or 65.6%, ohms a tong run orraoge of 62.245 avernl a Dully Role ADR growth evecrooms ore tncreasng. 2,9%vs the post 4 qumrrer5 Jore of 2.7%, but ere him die tong run overage al 3.I Ah Reveuue Fe+ Avdlultle Room Rey1'AR grvunh prat Khans fa the nag 4 quarters ore folling to 2,8%us :mtpored to the poi 4 quarters rare 013.2%, and ore raver than the [oyl run average 03.3% 7 Supply (plunge indicates uhovs long-tenu uveuuge) Supply growth 3s dolling, LI]%vs the poi 4 quarters' rote of 1.7%, A andgreate! Ihun the icn9 run enaage of 1.8% Demuud Fowl demand greedh la folllnq, r _946vs. the post 4 qumtea rats of 2.2%%, and tsbelaa the long run average of 2.0l5 CBRE is forecasting a 0.1 percent occupancy increase along with a 2.3 percent rise in ADR for 2018. The net result is a projected 2.4 percent boost to RevPAR. "The limited growth rates may be disappointing or even troubling for some industry participants. However, 2018 will mark the ninth consecutive year of rising occupancy, something we have not seen since the 1990s. While the slow growth in occupancy does indicate we are at the top of the business cycle, all factors indicate that we are in the midst of a record breaking, sustained period of prosperity for U.S. hotels," Woodworth said. "Like occupancy, CBRE also is projecting a ninth consecutive year of growth in RevPAR, total operating revenue, and GOP in 2018." CBRE also has identified an uptick in new lodging supply. For 2018, CBRE is forecasting a 2.0 percent increase in the number of available rooms. This does exceed the 1.8 percent long -run average annual rate of supply growth as reported by STR. "Historically, we have seen rising supply precede industry downturns. Fortunately, as has been demonstrated for several years now, the economic factors that matter most for hotel demand growth exceeded the changes in supply," said John B. (Jack) Corgel, Ph.D., professor of real estate at the Cornell University School of Hotel Administration and senior advisor to CBRE Hotels' Americas Research. "Looking forward, employment levels and income gains are expected and remain attractive. These movements will result in growing levels of demand and occupancy to counter balance supply growth." 19 ©2018 CBRE, Iric. CBRE Market Analysis 7°l% 6% 5% 4 % 3% 2% 1 °/% 0% • Historical Demand Change 1988-2016 ■ Historical Demand Change 2012-2016 ■ Forecast Demand Change 2017-2021 6.5% All Luxury Upper Upscale Upscale UpperMidsccle Midscale Source: CBRE Hotels' Americas Research, STR Q2 2017 Economy Investment Activity According to Real Capital Analytics Q3 17 US Capital Trends — Hotel report, "The hotel sector is the laggard for the year-to-date, with the sharpest decline in deal volume across major property types." A number of highlights as published are provided below: • For year-to-date figures ending September, overall sales volume is down roughly 20 percent on sales of $20b. • The decline in hotel deal activity is largely a story about the pullback in the full -service segments. Deal volume was down 58 percent YOY in Q3' 17 due in part of the Anbang deal a year prior, but that one deal is not the only issue at play. For the year-to-date, full service hotel investment is down 33%. Single asset sales, not just megadeals, fell in the full -service segments. • To the extent there was growth in Q3' 17 it was in the limited service segments. Deal volume was up 19% YOY in Q3' 17 and up 17% for the year-to-date. Megadeal volume was up 206% YOY with the largest deal involving the 138 million purchase of a portfolio of 14 hotels by Hospitality Properties Trust from Blackstone. The sale of individual assets was relatively unchanged from a year earlier. • Hotel cap rates have been trending up over the past two years due in part to changes in the quality of what is transacting. The average hotel sold at the end of 2013 for instance had 158 rooms versus an average of only 137 rooms sold in Q3' 17. • The perennial top market in these rankings is Manhattan but the market has slipped to the #3 position for deal activity over the year-to-date. The market is just a hair below Atlanta in the rankings, a market which normally holds a position closer to the low teens. • Los Angeles has assumed the top position for the year-to-date but there is no one grand slam of a megadeal driving this activity. The $1.5b in deal volume achieved was largely from single asset sales: The largest deal came in at $256m. The largest deal in Manhattan was even smaller at $200m. COMPETITIVE HOTEL MARKET ANALYSIS STR Industry Trend In order to more precisely identify hotel market trends, as they relate to the subject, CBRE has relied on a customized report prepared by STR, Inc., a national firm specializing in tracking hotel data. STR is generally considered the standard source of reliable data for most markets. While it is widely utilized, it is important to note some of its limitations. Specifically, hotels are 20 02018 CBRE, Inc. CBRE Market Analysis occasionally dropped in and out of the sample, and not all hotels report data in a consistent and timely matter. As a result, the data set is sometimes skewed upwards or downwards depending on the particular market and the overall quality of the data is negatively impacted. For most markets, however, it is considered to provide an accurate overall picture of market performance, and therefore, has been used in this analysis. Summary of Competitive Properties The following map and table provides a summary of the subject's competitive hotel set. I I1TLE HAITI EAST Lry Miami Dade College Wolfson Campus 0 OOWN TtIP.N MIAMI Vizcaya Museum .igcc&wardes SOUTH BEACH FLAMINGO i LUMMUS 51 FiohOr Islam ach data -.. Goa9Ir PRIMARY COMPETITIVE HOTELS 12 Months Ending January31, 2018 Number Percentage Year Competitive Occupancy ADR RevPAR Property of Roans Competitive Built Roams Occ. Penetration ADR Penetration RevPAR Penetration Doubletree Grand Biscayne Bay 219 100% 1988 219 75 % - 80% 90%- 100% $190 - $200 75%- 85% $145 - $155 75%- 85% Biscayne Bay Marriott Hotel & Marina 600 100% 1982 600 75% - 80 % 90% - 100 % $180 - $190 70% - 80% $140 - $145 70% - 80% Loews Miami Beach Hotel 790 100% 1998 790 80 % - 85% 90 % - 120% $300 - $310 105% - 135 % $240 - $250 125% - 135 Marriott South Beach 224 100% 2000 224 75 % - 80% 90 % - 100% $270 - $280 105 % - 135 % $210 - $220 110 % - 120% Courtyard Cadillac Miami Beach Oceanfront 356 100% 1940 356 75% - 80% 90 % - 100% $175 - $185 70 % - 80 % $135 - $140 70 % - 80 Primary Totals/Averages 2,189 2,189 75% $241.38 Overall Totals/Averages 2,189 2,189 79% $241.38 Compiled by CBRE PRIMARY COMPETITION Meeting Meeting Estimated 2018 Market Mix Space Space Corp. Business Sp Exercise Property Location (SF) (SF,,RM) Individual Group Leisure Restaurant Lounge Center Pool a Facilities Doubletree Grand Biscayne Bay Miami, Florida 8,481 38.7 35% 30% 35% Y Y Y Y Y Y Biscayne Bay Marriott Hotel & Marina Miami, Florida 6,793 11.3 35% 40% 25% Y Y Y Y Y Y Loews Miami Beach Hotel Miami Beach, Florida 65,000 82.3 15% 60% 25% Y Y Y Y Y Y Marriott South Beach Miami Beach, Florida 2,600 11.6 20% 10% 70% Y Y Y Y Y Y Courtyard Cadillac Miami Beach Oceanfront Miami Beach, Florida 2,737 7.7 25% 20% 55% Y Y Y Y Y Y Primary Totals,/Averages 25% 41% 34% Compiled by CBRE 21 © 2018 CBRE, Inc. CBRE Market Analysis The primary competitive set, excluding the subject has a total of 2,189 rooms. The trailing 12 months as of Jan TTM 2018 occupancy and ADR achieved by these properties was roughly 75% and $241.38, respectively. STR Custom Trend Report In order to more precisely identify hotel market trends, as they relate to the subject, CBRE has relied on a customized report prepared by STR, Inc., a national firm specializing in tracking hotel data. STR is generally considered the standard source of reliable data for most markets. While it is widely utilized, it is important to note some of its limitations. Specifically, hotels are occasionally dropped in and out of the sample, and not all hotels report data in a consistent and timely matter. As a result, the data set is sometimes skewed upwards or downwards depending on the particular market and the overall quality of the data is negatively impacted. For most markets, however, it is considered to provide an accurate overall picture of market performance, and therefore, has been used in this analysis. The hotels included in the STR report are based on interviews with representatives of the subject and subsequent field research. Historical Performance of the Competitive Market As noted, the preceding properties all compete for area lodging demand and are considered directly competitive with the subject. However, the subject property is unique in the competitive market due to its location on Watson Island as opposed to downtown Miami or Miami Beach. The hotels selected have either views of the Atlantic Ocean or Biscayne Bay. Additionally, they are all larger hotels, which is what the subject would be considered. As a result, all of the properties are chain affiliated. This is typical in the hotel industry as most larger hotels are generally affiliated with a national hotel chain. The subject may eventually be chain affiliated, but since no franchise affiliation has been decided on, we have assumed that the subject will operated as an independent. As such, we have utilized hotels that are larger, full -service hotels with either Biscayne Bay or Atlantic Ocean views. While we would prefer to use only properties with an identical location, identical designs and amenities, this is not possible as no other hotels are located on Watson Island. The historical market occupancies, average daily room rates and RevPAR over the past six years are summarized in the following table. 22 0 2018 CBRE, Inc. CBRE Market Analysis HISTORICAL MARKET PERFORMANCE STR TREND COMPETITIVE PROPERTIES Year 2012 2013 2014 2015 2016 2017 CAG Jan TTM 2016 Jan TTM 2017 Jan TTM 2018 CAG * Jan YTD 2015 Jan YTD 2016 Jan YTD 2017 Jan YTD 2018 CAG Room Night Market Room Night Percent Average Percent Percent Supply Occupancy Demand Change Daily Rate Change RevPAR 761,963 83.4% 635,286 $220.74 $184.04 761,025 80.3% 610,811 -3.9% $235.14 6.5% $188.73 794,174 83.2% 661,087 8.2% $244.39 3.9% $203.44 793,307 82.5% 654,506 -1.0% $246.14 0.7% $203.07 798,985 77.9% 622,405 -4.9% $226.25 -8.1% $176.25 766,233 77.9% 597,219 -4.0% $238.63 5.5% $186.00 0.1 % -1.2% 1.6% 793,834 82.4% 654,443 $244.90 798,985 77.2% 617,149 -5.7% $223.89 -8.6% 755,197 78.7% 594,218 -3.7% $241.38 7.8% - 2.5% -4.7% -0.7% 67,332 84.7% 57,000 $304.49 67,859 83.9% 56,937 -0.1% $290.35 -4.6% 67,859 76.2% 51,681 -9.2% $268.75 -7.4% 56,823 85.7% 48,680 -5.8% $304.12 13.2% - 8.5% -7.5% 2.3% $201.90 $172.94 $189.93 $257.76 $243.62 $204.68 $260.54 Change 2.5% 7.8% - 0.2% - 13.2% 5.5% 0.2% - 14.3% 9.8% - 3.0% -5.5% - 16.0% 27.3% 3.4% * Compound Annual Growth Source: STR Trend Report Proposed Hotels/Additions to Supply There are no new hotel projects that are felt to be new supply that will competitive with the competitive set except the subject. It should be noted that the Marriott Cadillac Hotel in Miami Beach closed in the fall of 2017 and is expected to open in April of 2018. While the hotel is 356 keys, the hotel effectively hotel operated as a 227 room hotel for the TTM ending in January 2018. Since the hotel is going to reopen in the next month or so, we have restored the original supply to our analysis. While CBRE has made several attempts to determine the level of new hotel supply entering the marketplace, it is impossible to determine every hotel that will be developed in the future, when they will be completed, or their potential impact to the subject. In conducting our investigations regarding the potential for additions to supply in the competitive market, we interviewed various developers and planning officials. We have identified additional projects in the local area but have not specifically included these properties in our analysis due to the stage of development, financing issues, market positioning, location, and/or rate structure. The inherent risk of any future new hotel supply has been implicitly considered in the selection of a stabilized occupancy level for the subject property. HOTEL DEMAND GENERATORS Demand for hotel rooms is categorized in three ways: • Demonstrated Demand: the demand already captured at competitive hotels; • Induced Demand: the demand that does not presently seek accommodations in the competitive market, but could be persuaded to do so through marketing efforts, room rates, facilities, services and amenities. 23 0 2018 CBRE, Inc. CBRE Market Analysis • Unsatisfied Demand: the demand that seeks accommodations in the market but is not satisfied due to one of a number of factors: sell-outs during peak season; lack of a particular type of accommodation; lack of meeting space; or high room rates. Hotel demand for the neighborhood is primarily generated by a heavy concentration of business and leisure travelers. Those travelers are looking to visit the Miami area because of the nearby office space, its local attractions or its seasonal weather, the sandy beaches, the cruise port, the airport, the shopping and the restaurants and bars in the area. For this analysis, we have utilized induced demand and unsatisfied demand since the rooms provided by the subject will likely induce some new travelers to the market and satisfy unsatisfied demand due to the high occupancies during peak months in the market. Demand Segmentation In most markets, overall demand varies based on the nature of travel. In most markets, the lodging demand is generated from three different segments: Corporate, Group/Meeting and Leisure travelers. In some markets, a fourth classification may be present, such as airline contract or government. A breakdown of the overall market segments as well is illustrated in the following table. DEMAND SEGMENTATION - COMPETITIVE MARKET Segment Competitive Set 2018 Demand Corp. Individual 145,615 25% Group 245,137 41% Leisure 203,466 34% Total 594,218 100% Compiled by CBRE The subject property is projected to do a significant amount of business with leisure passengers and penetrates both the group and leisure market at fairly high rates. Based on historic trends for the various demand segments, the state of the local and national economies, and conversations with local hotel operators in the marketplace, the applicable demand segments are projected to exhibit the following growth trends. ANNUAL DEMAND GROWTH RATES 2025 Segment 2018 2019 2020 2021 2022 2023 2024 and beyond Corp. Individual 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% Group 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% Leisure 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% Compiled by CB RE Attendance at Jungle Island Discussions with the management at Jungle Island indicated that the renovation of the Jungle Island Park is thought to be necessary to attract more visitors. The average annual attendance from 2005 to 2016 was estimated to be approximately 304,276 guests each year. The 24 02018 CBRE, Inc. CBRE Market Analysis ownership/management believes that new attractions must be added and the park in general needs a refreshed look. They plan to add zip lines throughout the park, change some of the food and beverage offerings and improve the beach area and add the subject proposed hotel. The following chart was provided by management and does seem to support their rationale sound considering attendance has been down the last three years. JUNGLE ISLAND ANNUAL ATTENDANCE Attendance Attendance That Year Change % 2005 267,356 --- 2006 324,327 21.3% 2007 336,931 3.9% 2008 320,268 -4.9% 2009 303,087 -5.4% 2010 293,251 -3.2% 2011 315,367 7.5% 2012 306,372 -2.9% 2013 327,324 6.8% 2014 314,429 -3.9% 2015 274,141 -12.8% 2016 268,464 -2.1 2017* 278,801 3.9% 2018* 376,152 34.9% 2019* 425,661 13.2% Average (2005-2016) 304,276 Source: Jungle Island Mana * Projected According to the General Manager (Christopher Gould), this type of pattern is typical of most amusement parks due to the fact that the local population wants to see new attractions to make the park feel new. Mr. Gould also indicated that approximately 50% of the total attendance is from out of town while approximately 50% of the guests are local visitors. Of the roughly 50% that are out of town, he indicated approximately 50% of that number is international while the other 50% is from the United States. This would indicate an average number of 152,138 guests from out of town. This is a prime market that the subject property would likely target. If the hotel were to capture even 25% of these guests it would fill approximately 35% of the hotel rooms year round. While it is difficult to estimate exactly how much of this population, it does appear that the subject would have a significant number of potential customers just from the Jungle Island attendee population alone. Additional targets would include the roughly 430,000 annual guests that visit the Miami Children's Museum and cruise passengers departing from the adjacent Port of Miami. Based on market factors presented throughout this section, the forecast of overall demand growth for the subject's market is illustrated as follows: 25 0 2018 CBRE, Inc. CBRE Market Analysis PROJECTED BASE DEMAND, ANNUAL GROWTH, AND MARKET -WIDE OCCUPANCY Competitive Set Year Ending1/31/ 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Corp. Individual Annual Growth 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% Base Nightly Demand 399 405 411 417 423 430 436 443 449 456 463 Annual Room Nights 145,615 147,799 150,016 152,683 154,550 156,868 159,221 162,053 164,034 166,494 168,992 Displaced Demand Rate 3.5% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% Displaced Demand - 5,173 10,501 10,688 10,819 10,981 11,145 11,344 11,482 11,655 11,829 Induced Demand - 3,855 8,968 12,859 12,824 12,824 12,824 12,859 12,824 12,824 12,824 Total Segment Demand 145,615 156,827 169,485 176,230 178,193 180,673 183,191 186,256 188,341 190,973 193,646 Group Annual Growth 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% Base Nightly Demand 672 682 692 702 713 724 734 745 757 768 779 Annual Room Nights 245,137 248,814 252,546 257,037 260,180 264,082 268,044 272,810 276,145 280,287 284,492 Displaced Demand Rate 3.5% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% Displaced Demand - 8,708 17,678 17,993 18,213 18,486 18,763 19,097 19,330 19,620 19,914 Induced Demand - 2,754 6,406 9,185 9,160 9,160 9,160 9,185 9,160 9,160 9,160 Total Segment Demand 245,137 260,276 276,630 284,215 287,552 291,728 295,967 301,092 304,636 309,068 313,566 Leisure Annual Growth 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% Base Nightly Demand 557 566 574 583 592 601 610 619 628 637 647 Annual Room Nights 203,466 206,518 209,616 213,343 215,952 219,191 222,479 226,435 229,203 232,641 236,131 Displaced Demand Rate 3.5% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% Displaced Demand - 7,228 14,673 14,934 15,117 15,343 15,574 15,850 16,044 16,285 16,529 Induced Demand - 4,406 10,249 14,697 14,656 14,656 14,656 14,697 14,656 14,656 14,656 Total Segment Demand 203,466 218,152 234,538 242,974 245,725 249,191 252,709 256,981 259,904 263,582 267,316 Touts Corp. Individual 145,615 156,827 169,485 176,230 178,193 180,673 183,191 186,256 188,341 190,973 193,646 Group 245,137 260,276 276,630 284,215 287,552 291,728 295,967 301,092 304,636 309,068 313,566 Leisure 203,466 218,152 234,538 242,974 245,725 249,191 252,709 256,981 259,904 263,582 267,316 Total Market Demand 594,218 635,255 680,653 703,419 711,470 721,592 731,867 744,329 752,881 763,623 774,528 Growth overPnorYear 6.9% 7.1% 3.3% 1.1% 1.4% 1.4% 1.7% 1.1% 1.4% 1.4% Market Statistics Existing Rooms Supply 2,069 2,069 2,069 2,069 2,069 2,069 2,069 2,069 2,069 2,069 2,069 Proposed Rooms Supply - 129 429 429 429 429 429 429 429 429 429 Total Available Room Nights 755,197 802,271 911,782 914,280 911,782 911,782 911,782 914,280 911,782 911,782 911,782 Growth over Prior Year 6.2% 13.7% 0.3% -0.3% 0.0% 0.0% 0.3% -0.3% 0.0% 0.0% Potential Market -wide Occupancy 78.7% 79.2% 74.7% 76.9% 78.0% 79.1% 80.3% 81.4% 82.6% 83.8% 84.9% Accommodated Market Occupanc 78.7% 79.2% 74.7% 76.9% 78.0% 79.1% 80.3% 81.4% 82.6% 83.8% 84.9% Source: CBRE Based upon the historical performance of the hotel market and due to the cyclical seasonal patterns and weekday versus weekend trends in the market in addition to the projected new supply, it is unlikely that the market will exceed the 90.0% percent level over the long term. Furthermore, with a three year projected period (market stabilization for the subject to occur at the beginning of the third year) to move towards stabilized operations, we find these projections reasonable. However, in theory hotels do not actually stabilize due to the fact that they must sell new rooms every night in order to perform properly. This factor makes hotels as an asset class slightly more volatile in both good times and in bad. FORECAST OF OCCUPANCY AND AVERAGE DAILY RATE The average daily rate and the overall occupancy of a lodging facility are the foundation for the property's financial performance. While a property's other revenue components (food and beverage, telephone, spa, other income, etc.) are crucial to the operation of the hotel, they are dependent on the overall number of occupied rooms. Furthermore, the occupancy and average daily rate of a hotel are highly correlated. In reality, one cannot make a projection of one without a projection of the other. Therefore, while we have made specific projections of occupancy, but have considered the subject's positioned rate in our forecast. 26 © 2018 CBRE, 8K. CBRE Market Analysis Penetration Penetration is the relationship between a market's fair share and its actual share of the overall demand. For example, a 100-room hotel would equate to 10% of a 1,000 room competitive set. If this hotel were to capture 10% of the overall lodging demand, it would penetrate the market by 100 percent. The current market penetration rates of the competitive hotels and the subject, broken down by demand segment, are illustrated as follows: SEGMENTED PENETRATION 2018 Estimated Segmented Penetration Average 2018 2018 Fair Corp. Property Room Count Occupancy Share Individual Group Leisure Total Doubletree Grand Biscayne Bay 219 75% - 80% 10.6% 120% - 150% 65% - 75% 90% - 120% 90% - 100% Biscayne Bay Marriott Hotel & Marina 600 75% - 80% 29.0% 120% - 150% 90% - 100% 65% - 75% 90% - 100% Loews Miami Beach Hotel 790 80% - 85% 38.2% 55% - 65% 135% - 165% 70% - 80% 90% - 120% Marriott South Beach 224 75% - 80% 10.8% 75% - 85% 20% - 30% 175% - 225% 90% - 100% Courtyard Cadillac Miami Beach Oceanfront 356 75% - 80% 17.2% 60% - 70% 25% - 35% 90% - 120% 90% - 100% Total/Avg 2,069 78.7% 100.0% 100% 100% 100% 100% Compiled by CBRE Overall, the proposed subject improvements represent a viable hotel. The projections of captured penetration rates for the subject by demand segment along with the resulting projections of occupied room -nights are illustrated as follows: 27 © 2018 CBRE, Iric. CBRE Market Analysis PROJECTED SUBJECT PENETRATION SCHEDULE Year Ending 1/31/ 2019 2020 2021 SUBJECT PROPERTY FA 2022 2023 2024 2025 2026 IR SHARE Market Room Supply Subject Avg. Room Count Fair Share 2,198 2498 2,498 0 149 300 0.0% 6.0% 12.0% ROOM NIGHTS CAPTURED 2,498 2,498 300 300 12.0% 12.0% BY SUBJECT 2,498 300 12.0% 2,498 300 12.0% 2,498 300 12.0% Corp. Individual Fair Share Penetration Factor Market Share Demand Market Share Capture Group Fair Share Penetration Factor Market Share Demand Market Share Capture Leisure Fair Share Penetration Factor Market Share Demand Market Share Capture Total Capture Potential Subject Occupancy Overall Projected Subject Penetration Compiled by CBRE 0.0% 6.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 0.0% 90.0% 93.0% 95.0% 95.0% 95.0% 95.0% 95.0% 0.0% 5.4% 11.2% 11.4% 11.4% 11.4% 11.4% 11.4% 156,827 169,485 176,230 178,193 180,673 183,191 186,256 188,341 0.0% 5.4% 11.2% 11.4% 11.4% 11.4% 11.4% 11.4% 0 9,098 19,683 20,330 20,613 20,900 21,250 21,488 0.0% 6.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 0.0% 90.0% 95.0% 100.0% 100.0% 100.0% 100.0% 100.0% 0.0% 5.4% 11.4% 12.0% 12.0% 12.0% 12.0% 12.0% 260,276 276,630 284,215 287,552 291,728 295,967 301,092 304,636 0.0% 5.4% 11.4% 12.0% 12.0% 12.0% 12.0% 12.0% 0 14,850 32,426 34,533 35,035 35,544 36,159 36,585 0.0% 6.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 0.0% 90.0% 95.0% 100.0% 100.0% 100.0% 100.0% 100.0% 0.0% 5.4% 11.4% 12.0% 12.0% 12.0% 12.0% 12.0% 218,152 234,538 242,974 245,725 249,191 252,709 256,981 259,904 0.0% 5.4% 11.4% 12.0% 12.0% 12.0% 12.0% 12.0% 0 12,591 27,721 29,510 29,926 30,349 30,862 31,213 0 36,539 79,830 84,374 85,574 86,793 88,271 89,286 0.0% 67.2% 72.7% 77.1 % 78.2% 79.3% 80.4% 81.5% 0.0% 90.0% 94.5% 98.7% 98.7% 98.7% 98.7% 98.7% The overall accommodated room night demand is multiplied by the subject's fair share and by the overall projected penetration ratio to derive the subject's accommodated room night demand. Although the subject's illustrated occupancy rates increase after the stabilized year, we have selected as the stabilized occupancy figure. The stabilized occupancy figure is intended to be an average figure over the projected holding period. The following depicts the derivation of the occupancy projections for the subject. 28 CBRE Market Analysis SUBJECT PROPERTY ESTIMATED OCCUPANCY ADJUSTED TO PROJECTION DATES Competitive Set Year Ending 1/31/ Room Nights Captured Available Room Nights Potential Subject Occupancy Overall Potential Subject Market Share Overall Potential Subject Penetration 2018 0 0 0.0% 0.0% 0.0% 2019 0 0 0.0% 0.0% 0.0% 2020 2021 36,539 79,830 54,385 109,800 67.2% 72.7% 5.4% 11.3% 90.0% 94.5% 2022 2023 2024 2025 2026 84,374 85,574 86,793 88,271 89,286 109,500 109,500 109,500 109,800 109,500 77.1% 78.2% 79.3% 80.4% 81.5% 11.9% 11.9% 11.9% 11.9% 11.9% 98.7% 98.7% 98.7% 98.7% 98.7% Adjustment to Projection Year Ending 12/31/ First Year % Second Year % Adjusted Room Nights Accommodated Projection Period Fiscal Year Occupancy Rounded Occupancy Overall Market Share Overall Penetration Captured Room Nights (Based on Rounded Occ.) 2020 8.0% 92.0% 67,683 61.8% 62% 0.0% 0.0% 67,890 2021 8.0% 92.0% 79,345 72.3% 72% 10.8% 93.6% 79,056 2022 8.0% 92.0% 83,993 76.7% 77% 11.9% 99.0% 84,315 2023 8.0% 92.0% 85,478 78.1 78% 11.8% 98.7% 85,410 2024 8.0% 92.0% 86,696 79.2% 79% 11.8% 98.5% 86,505 2025 8.0% 92.0% 88,172 80.3% 80% 11.8% 98.1 87,840 2026 8.0% 92.0% 89,185 81.4% 81% 11.8% 98.5% 88,695 2027 8.0% 92.0% 89,185 81.4% 81% 11.4% 96.8% 88,695 Compiled by CBRE Average Daily Rate As noted previously, one of the most important considerations in deriving an opinion of value of a hotel is its forecast of a supportable average daily rate (ADR). The ADR of a hotel can be calculated by dividing the total rooms revenue by the total number of occupied rooms achieved during a specified period of time. SUBJECT'S COMPETITIVE POSITIONING Although the forecast of average daily rate follows the discussion of future occupancy, these two figures are highly correlated, and one cannot make projections of occupancy without specific assumptions of ADR. This relationship is defined by RevPAR, or Revenue Per Available Room. RevPAR is the measure of a property's ability to maximize rooms revenue. Theoretically, for example, if a lodging property's ADR increases substantially (with no market influencing factors), its occupancy would decrease. Conversely, if a property's ADR decreases, an increase in occupancy would be anticipated. In each instance, RevPAR would remain unchanged. The projected ADR and RevPAR for the subject and the competitive set are illustrated as follows: SUBJECT AND COMPETITIVE ADR AND REVPAR Property Doubletree Grand Biscayne Bay Biscayne Bay Marriott Hotel & Marina Loews Miami Beach Hotel Marriott South Beach Courtyard Cadillac Miami Beach Oceanfront Market Weighted Average Subject's Positioned ADR as of 1/31/2018: 2018 ADR $190 - $200 $180 - $190 $300 - $310 $270 - $280 $175-$185 $241.38 $175.00 2018 RevPAR $145-$155 $140 - $145 $240 - $250 $210 - $220 $135-$140 $189.93 Source: CBRE The subject property will be the newest property in the market and will likely capture a significant amount of the attendees from Jungle Island, the Miami Children's Museum and the 29 0 2018 CBRE, Inc. CBRE Market Analysis group business that it will be able to attract. The projections for ADR growth and the resulting rates used in the analysis are illustrated as follows: SUBJECT'S ESTIMATED ADR 12 Months ADR Estimated Ending Growth ADR 1 /31 /2018 -- $175.00 1/1/2020 ** 5.8% $185.07 1/1/2021 4.0% $192.47 1/1/2022 5.0% $202.09 1/1/2023 4.0% $210.18 1/1/2024 3.0% $216.48 1/1/2025 3.0% $222.98 1/1/2026 3.0% $229.67 1/1/2027 3.0% $236.56 ** Inflationary adjustment of 5.8% from 1/31/18 through 1 /01 /20 (secondary projection start date). CONCLUSION The subject's occupancy, ADR, RevPAR, and corresponding room revenue for the first several years of our projection analysis are illustrated as follows: OCCUPANCY, ADR, & ROOMS REVENUE CONCLUSIONS Fiscal Year Ending 12/31/ 2020 2021 2022 Avg. Available Rooms 300 300 300 Annual Room Nights 109,500 109,800 109,500 Occupancy 62% 72% 77% Occupied Rooms 67,890 79,056 84,315 ADR $192.47 $202.09 $210.18 RevPAR $119.33 $145.51 $161.84 RevPAR Growth 21.9% 11.2% Total Rooms Revenue $13,066,872 $15,976,806 $17,721,208 Source: CBRE Based on the foregoing analysis, the indicated occupancy and ADR figures are achievable. Although it is possible that the subject will experience growth in occupancy and ADR above those estimated in this report, it is also possible that sudden economic downturns, unexpected additions to rooms supply, the end of the US energy boom, or other external factors will force the property below the selected point of stability. Consequently, the estimated occupancy and ADR levels are representative of the most likely potential operations of the subject over the projected holding period based on our analysis of the market as of the date of this appraisal. The subject's projection of rooms revenue is illustrated again in the Income Capitalization Section of this report. 30 0 2018 CBRE, Inc. CBRE Highest and Best Use Highest and Best Use In appraisal practice, the concept of highest and best use represents the premise upon which value is based. The four criteria the highest and best use must meet are: • legally permissible; • physically possible; • financially feasible; and • maximally productive. The highest and best use analysis of the subject is discussed below. AS VACANT The property is zoned not currently zoned for hotel use. However, if the City Commission of Miami approves the project, the site is of sufficient size to accommodate various types of development. The immediate area includes various other recreational uses. Considering the surrounding land uses, location attributes, legal restrictions and other factors, it is our opinion that a hotel oriented use would be reasonable and appropriate. Therefore, it is our opinion that the highest and best use would be for hotel -related use, time and circumstances warranting. AS PROPOSED Legal Permissibility The legally permissible uses were discussed in detail in the Site Analysis and Zoning Sections. Physical Possibility The subject is adequately served by utilities, has an adequate shape and size, sufficient access, etc., to be a separately developable site. The subject site would reasonably accept a site layout for any of the legally probable uses. There are no known physical reasons why the subject site would not support any legally probable development. Financial Feasibility The determination of financial feasibility is dependent primarily on the relationship of supply and demand for the legally probable land uses versus the cost to create the uses. As discussed in the market analysis, the subject hotel market is generally improving from the downturns experienced in the last few years. Development of new hotel properties has occurred in the past few years. Additionally, financing for new development has become available for new projects as well as for renovations. These factors indicate that it would probably be financially feasible to complete a new hotel project to provide an adequate developer's profit. Additionally, our estimate of the cost of development found in the Cost Approach section of the report shows that sufficient profit does appear to be present to substantiate the feasibility of the subject in the current market. 31 0 2018 CBRE, Inc. CBRE Highest and Best Use Maximum Profitability The final test of highest and best use of the site as proposed is that the use be maximally productive, yielding the highest return to the land. In the case of the subject as built and as proposed, the analysis has indicated that the proposed hotel would be maximally profitable, if the project is approved by the City of Miami. Conclusion: Highest and Best Use As Proposed Based on the information presented above and upon information contained in the market and neighborhood analysis, we conclude that the highest and best use of the subject as proposed would be for construction of the proposed hotel as planned. Our analysis of the subject and its respective market characteristics indicate the most likely buyer as proposed, would be a developer as we have concluded that the subject property is feasible at this time. The most likely buyer for the subject as is may also be a developer since the possibility of building on the vacant site with a hotel is likely to be attractive to a developer 32 Appraisal Methodology Appraisal Methodology In appraisal practice, an approach to value is included or omitted based on its applicability to the property type being valued and the quality and quantity of information available. COST APPROACH The cost approach is based on the proposition that the informed purchaser would pay no more for the subject than the cost to produce a substitute property with equivalent utility. This approach is particularly applicable when the property being appraised involves relatively new improvements that represent the highest and best use of the land, or when it is improved with relatively unique or specialized improvements. However, given the age of the subject and the fact that the subject is part of a much larger development, we do not believe the cost approach would be a reliable indicator in the case of the subject. Properties such as this typically have fewer sales of comparable properties. SALES COMPARISON APPROACH The sales comparison approach utilizes sales of comparable properties, adjusted for differences, to indicate a value for the subject. Valuation is typically accomplished using physical units of comparison such as price per square foot, price per unit, price per floor, etc., or economic units of comparison such as gross income multiplier. Adjustments are applied to the physical units of comparison derived from the comparable sale. The unit of comparison chosen for the subject is then used to yield a total value. Economic units of comparison are not adjusted, but rather analyzed as to relevant differences, with the final estimate derived based on the general comparisons. INCOME CAPITALIZATION APPROACH The income capitalization approach reflects the subject's income -producing capabilities. This approach is based on the assumption that value is created by the expectation of benefits to be derived in the future. Specifically estimated is the amount an investor would be willing to pay to receive an income stream plus reversion value from a property over a period of time. The two common valuation techniques associated with the income capitalization approach are direct capitalization and the discounted cash flow (DCF) analysis. METHODOLOGY APPLICABLE TO THE SUBJECT In valuing the subject, all three approaches are applicable and have been used. 33 0 2018 CBRE, Inc. CBRE Land Value Land Value The following map and table summarize the comparable data used in the valuation of the subject site. A detailed description of each transaction is included in the addenda. De Ilns Park t 5- to lAY CD Google OED 2r01h St z Margaret Pace Park NW ]?1h Z1 y ldl-:m KO TOWN _® 0 OVERTOWN h615' 81h'01 NW 711, 5; NW 6 51 F114' Soh 51 NW 15f 51 v+fe As'r n:s1 Al SW 101 h SQUARE J z � s 9 a - m m ric 1511," D Q z Z rti 5 run. Vswtl n � ....Miami Dade College • Wolfson Campus MacArrhtre DOWNTOWN �IAMI Miami ngle Island SUMMARY OF COMPARABLE LAND SALES No. Property Location Transaction Actual Sale Adjusted Sale Density Allowable Price Per Type Date Proposed Use Price Price 1 (UPA) Units Bldg Unit 1 250 SW 7th Street, Miami, FL Sale Apr-15 Hotel $15,500,000 $15,500,000 400.00 412 $37,621 2 1265 SW 22nd Street, Miami, FL Sale Jul-15 144 Unit Hotel $4,500,000 $4,500,000 174.76 144 $31,250 3 19 SW 6th Street 42 SW 6th Street, Miami, FL Sale Aug-15 TBD $8,820,000 $8,820,000 499.73 182 $48,462 4 1753 -1775 NE 2nd Avenue, Miami, FL Sale May-17 Mixed -use $33,000,000 $33,000,000 500.00 693 $47,619 retail/office, residential & hotel Subject 1111 Parrot Jungle Trail, Miami, Florida Hotel 125.21 300 I Adjusted sale price for cash equivalency and!or development costs (where applicable) Compiled by CBRE 34 © 201 8 CBRE, Inc. CBRE Land Value SUMMARY OF ADJUSTMENTS Based on our comparative analysis, the following chart summarizes the adjustments warranted to each comparable. LAND SALES ADJUSTMENT GRID Comparable Number Transaction Type Transaction Date Proposed Use 1 Sale Apr-15 Hotel 2 Sale Jul-15 144 Unit Hotel 3 Sale Aug-15 TBD 4 Sale May-17 Mixed -use retail/office, Actual Sale Price $15,500,000 $4,500,000 $8,820,000 $33,000,000 Adjusted Sale Price 1 $15,500,000 $4,500,000 $8,820,000 $33,000,000 Size (Acres) 1.03 0.82 0.36 1.39 Size (SF) 44,865 35,894 15,863 60,375 Density (UPA) 400.00 174.76 499.73 500.00 Allowable Units 412.00 144.00 182.00 693.00 Price Per Unit $37,621 $31,250 $48,462 $47,619 Price ($ Per Unit) $37,621 $31,250 $48,462 $47,619 Property Rights Conveyed 0% 0% 0% 0% Financing Terms 1 0% 0% 0% 0% Conditions of Sale 0% 0% 0% 0% Market Conditions (Time) 0% 0% 0% 0% Subtotal $37,621 $31,250 $48,462 $47,619 Size -5% -5% -10% -5% Shape 0% 0% 0% 0% Corner 0% 0% 0% 0% Frontage 15% 15% 0% 15% Topography 0% 0% 0% 0% Location 0% 10% 0% 0% Zoning/Density 10% 10% 0% 10% Utilities 0% 0% 0% 0% Highest & Best Use 0% 0% 0% 0% Total Other Adjustments 20% 30% -10% 20% Value Indication for Subject $45,146 $40,625 $43,615 $57,143 Absolute Adjustment 30% 40% 10% 30% Subject Hotel 2.40 104,369 125.21 300.00 ' Adjusted sale price for cash equivalency and/or development costs (where applicable) Compiled by CBRE CONCLUSION After adjustment the Land Sales ranged from $40,625 to $57,143 per unit with an average of $44,381 per unit and a median of $46,632 per unit. Based on the preceding analysis, a price per unit indication towards the upper portion of the range was most appropriate for the subject. The following table presents the valuation conclusion: CONCLUDED LAND VALUE $ Per Unit Subject Units Total $45,000 x 300 = $13,500,000 $50,000 x 300 = $15,000,000 Indicated Value: $14,300,000 (Rounded $ Per Unit) $47,667 Compiled by CBRE The value equates to approximately $47,667 per unit, which equates to approximately $14,300,000 which appears reasonable based upon the subject's location and views. 35 CBRE Cost Approach Cost Approach In estimating the replacement cost new for the subject, the following methods/data sources have been utilized (where available): • the comparative unit method has been employed, utilizing the Marshall Valuation Service (MVS) cost guide, published by Marshall and Swift, LLC; and • construction budget cost figures available for comparable properties have been considered. In this case, both methods have been utilized. MARSHALL VALUATION SERVICE Direct Cost Salient details regarding the direct costs are summarized in the Cost Approach Conclusion at the end of this section. The MVS cost estimates include the following: 1. average architect's and engineer's fees for plans, plan check, building permits and survey(s) to establish building line; 2. normal interest in building funds during the period of construction plus a processing fee or service charge; 3. materials, sales taxes on materials, and labor costs; 4. normal site preparation including finish grading and excavation for foundation and backfill; 5. utilities from structure to lot line figured for typical setback; 6. contractor's overhead and profit, including job supervision, workmen's compensation, fire and liability insurance, unemployment insurance, equipment, temporary facilities, security, etc.; 7. site improvements (included as lump sum additions); and 8. initial tenant improvement costs are included in MVS cost estimate. However, additional lease -up costs such as advertising, marketing and leasing commissions are not included. Base building costs (direct costs) are adjusted to reflect the physical characteristics of the subject. Making these adjustments, including the appropriate local and current cost multipliers, the direct building cost is indicated. Additions Items not included in the direct building cost estimate include parking and walks, signage, landscaping, and miscellaneous site improvements. The cost for these items is estimated separately using the segregated cost sections of the MVS cost guide. Indirect Cost Items Several indirect cost items are not included in the direct building cost figures derived through the MVS cost guide. These items include developer overhead (general and administrative costs), property taxes, legal and insurance costs, local development fees and contingencies, lease -up 36 0 2018 CBRE, Inc. CBRE Cost Approach and marketing costs and miscellaneous costs. The concluded indirect cost allowance is 7.0% which is consistent with the latest HVS Hotel Development Cost Survey. MVS Conclusion The concluded direct and indirect building cost estimates obtained via the MVS cost guide are illustrated as follows: MARSHALL VALUATION SERVICE COST SCHEDULE Primary Building Type: Hotel Height per Story: 10' Effective Age: 0 YRS Number of Buildings: 1 Condition: Excellent Gross Building Area: 425,000 SF Exterior Wall: Concrete Block Net Rentable Area: 425,000 SF Number of Stories: 9 Average Floor Area: 47,222 SF MVS Sec/Page MVS On Line Quality/Bldg. Class Average/A Building Component Hotel and Parking Garage Component Sq. Ft. 425,000 SF Base Square Foot Cost $122.56 Square Foot Refinements Heating and Cooling Sprinklers Subtotal Height and Size Refinements Number of Stories Multiplier Height per Story Multiplier Floor Area Multiplier Subtotal $0.00 $0.00 $122.56 1.000 1.000 1.000 $122.56 Cost Multipliers Current Cost Multiplier 1.00 Local Multiplier 1.00 Final Square Foot Cost $122.56 Base Component Cost $52,088,026 Base Building Cost (via Marshall Valuation Service cost data) $52,088,026 Additions Signage, Landscaping & Misc. Site Improvements (not included above) $250,000 Parking/Walks (not included above) $25,000 Other $0 Direct Building Cost $52,363,026 Indirect Costs 7.0% of Direct Building Cost $3,665,412 Direct and Indirect Building Cost $56,028,438 Rounded $56,028,000 Compiled by CBRE 37 © 2018 CBRE, 8K. CBRE Cost Approach ACTUAL/BUDGET COMPARABLE CONSTRUCTION COSTS No construction budget costs were provided by the developer since no final plans have yet been made. Available comparable cost data is provided in the following table: CONSTRUCTION COSTS Comparable: Name: Property Type Cost Data Based Upon... Number of Units: Size (SF): Cost Component Direct Cost Indirect Cost Lease -up Cost Total Direct, Indirect & Lease -up Cost Adjustment Total Adjusted Costs Rounded Cost Per Room Cost Per SF FF&E Costs Cost Per Room Compiled by CBRE 2 3 Average Comp Name Comp Name 2 Comp Name 3 1 Full Service Full Service Full Service Hotel Hotel Hotel 192 209 128 176 432,396 135,811 73,450 213,886 $44,672,721 $18,369,031 $7,955,580 $23,665,777 $4,963,636 $2,372,212 $4,389,450 $3,908,433 $0 $3,212,476 $598,000 $1,270,159 $49,636,357 $0 $23,953,719 $0 $12,943,030 $0 $28,844,369 $0 $49,636,357 $23,953,719 $258,523 $114.79 $4,800,000 $25,000 $114,611 $176.38 $3, 532, 536 $16,902 $12,943,030 $28,844,369 $28,844,000 $101,117 $158,084 $176.22 $155.79 $2,284,800 $3,539,112 $17,850 $19,917 DIRECT AND INDIRECT COST CONCLUSION The indicated direct and indirect building costs for the subject are illustrated as follows: DIRECT AND INDIRECT COST CONCLUSION Source MVS Cost Guide Cost Comparables (Avg.) CBRE Estimate Compiled by CBRE Subject Estimate $56,028,000 n/a $55,000,000 Per Unit Per SF $186,760 $131.83 $158,084 $155.79 $183,333 $129.41 The MVS cost estimate was given most consideration towards a cost conclusion. COST APPROACH CONCLUSION The value estimate is calculated as follows. 38 0 2018 CBRE, Inc. CBRE Cost Approach COST APPROACH CONCLUSION Primary Building Type: Hotel Height per Story: 10' Effective Age: 0 YRS Number of Buildings: 1 Condition: Excellent Gross Building Area: 425,000 SF Exterior Wall: Concrete Block Net Rentable Area: 425,000 SF Number of Stories: 9 Average Floor Area: 47,222 SF Direct and Indirect Building Cost $55,000,000 Entrepreneurial Profit 10.0% of Total Building Cost $5,500,000 Replacement Cost New $60,500,000 Accrued Depreciation Unfinished Shell Space $0 Incurable Physical 0.0% of Replacement Cost New $0 Deterioration less Curable Physical Functional Obsolescence $0 External Obsolescence $0 Total Accrued Depreciation 0.0% of Replacement Cost New $0 Contributory Value of FF&E $2,300,000 Depreciated Replacement Cost $62,800,000 Land Value $14,300,000 Indicated Stabilized Value $77,100,000 Rounded $77,100,000 Stabilization Discount ($6,100,000) Indicated As Complete Value $71,000,000 Rounded $71,000,000 Value Per SF $157.78 Compiled by CBRE 39 © 2018 CBRE, 8K. CBRE Sales Comparison Approach Sales Comparison Approach The following map and table summarize the comparable data used in the valuation of the subject. A detailed description of each transaction is included in the addenda. Val.aQosta Tallahassee Jacksonville 0 I811n5v cK Lake Cit ai sville 0 0 Ocala Clearwater° Ta pa 0 St. Petersburg Sr. Augustine Daytona Beach Q OrI do Kissimmee 0 °Lakeland FLORILDA Fort Myers ° !Naples Key West Melbourne Pert St Lucie Q West Palm Beach Fort Lauderdale MR 11 Everglades Natrona; Park Freeparl The Bahamas. Map data 1=2017 Google, INEGI SUMMARY OF COMPARABLE HOTEL SALES No. Name Transaction Year No. Actual Sale Adjusted Sale Price Per Gross Income NO1 Per Type Date Built Rooms Price Price' Room Occ. Multiplier Room N01 % OAR 1 Aloft Tampa Downtown, 100 West Kennedy Boulevard, Tampa, FL 2 Hilton University of Florida Conference Center, 1714 SW 34th Street, Gainesville, FL 3 Embassy Suites Orlando Downtown, 191 East Pine Street, Orlando, FL 4 Westin Tampa Harbour Island, 725 South Harbour Island Boulevard, Tampa, FL Sale Nov-15 2014 Sale Feb-16 2000 Sale Mar-16 2000 Sale Sep-16 1985 130 $27,243,000 $27,243,000 $209,562 71% 4.74 816,786 37.96% 8.01% 248 836,000,000 $49,500,000 $199,597 79% 2.88 814,810 29.09% 7.42% 167 $35,350,000 $44,350,000 $265,569 80% 4.14 $20,130 31.37% 7.58% 299 $55,000,000 $64,000,000 $214,047 75% N/A $18,215 N/A 8.51% Subj. Jungle Island Proposed Hotel, Pro 1111 Parrot Jungle Trail, Forma Miami, Florida -- 2019 300 77% -- $23,634 73.94% I Adjusted sale price for cash equivalency, lease -up and/or deferred maintenance (where applicable) Compiled by CBRE 40 © 2018 CBRE, Inc. CBRE Sales Comparison Approach The sales utilized represent the best data available for comparison with the subject. They were selected from our research of comparable improved sales within the State of Florida. These sales were chosen based upon their quality, operational profile and level of service. SUMMARY OF ADJUSTMENTS Based on our comparative analysis, the following chart summarizes the adjustments warranted to each comparable. HOTEL SALES ADJUSTMENT GRID Comparable Number Transaction Type Transaction Date Year Built No. Rooms Actual Sale Price Adjusted Sale Price 1 Price Per Room Occupancy Gross Room Rev. Multiplier NOI Per Room OER OAR Adj. Price Per Room Property Rights Conveyed Financing Terms 1 Conditions of Sale Market Conditions (Time) Subtotal - Price Per Room Location Average Property Size Age/Condition Quality of Construction Economic Factors Amenities Total Other Adjustments 1 2 Sale Nov-15 2014 130 $27,243,000 $27,243,000 $209,562 71% 4.74 $16,786 37.96% 8.01% $209,562 -5% 0% 0% 0% $199,083 5% 0% 0% 0% 0% 0% 5% Sale Feb-16 2000 248 $36,000,000 $49,500,000 $199,597 79% 2.88 $14,810 29.09% 7.42% $199,597 0% 0% 0% 0% $199,597 20% 0% 5% 0% 0% 0% 25% 3 4 Sale Mar-16 2000 167 $35,350,000 $44,350,000 $265,569 80% 4.14 $20,130 31.37% 7.58% $265,569 -5% 0% 0% 0% $252,290 5% 0% 5% 0% 0% 0% 10% Sale Sep-16 1985 299 $55,000,000 $64,000,000 $214,047 75% N/A $18,215 N/A 8.51% $214,047 -5% 0% 0% 0% $203,344 5% 0% 10% 0% 0% 0% 15% Indicated Value Per Room Absolute Adjustment $209,038 $249,496 $277,519 $233,846 10% 25% 15% 20% Subj. Pro Forma 2019 24 77% $23,634 73.94% Adjusted for cash equivalency Compiled by CBRE , lease -up and/or deferred maintenance (where applicable) After adjustment the comparables ranged from $209,038 per unit to $277,519 per unit with an average of $242,475 per unit and a median of $241,671 per unit. All of the comparables were given equal weight. GROSS REVENUES MULTIPLIER (GRM) The Gross Revenues Multiplier (GRM) reflects the relationship between gross revenues and sales price. It is most effective when valuing stabilized properties with similar operating ratios. The following illustrates the GRM for each of the sales analyzed herein. 41 CBRE Sales Comparison Approach GROSS INCOME MULTIPLIER ANALYSIS Sale No. GIM 1 4.74 2 2.88 3 4.14 4 N/A Compiled by CBRE With consideration to the preceding analysis and the income -producing capabilities of the subject, we have utilized a within the range of the comparables. SALE COMPARISON APPROACH CONCLUSION Equal emphasis has been placed on both methods as each was considered equally reliable. The following table summarizes the stabilized value indications and the concluded value of the subject, via the Sales Comparison Approach. SALES COMPARISON APPROACH Total Rooms X Value Per Room = Value 300 X $240,000 = $72,000,000 300 X $250,000 = $75,000,000 Gross Income X GIM = Value $27,202,783 X 3.25 = $88,409,046 $27,202,783 X 3.50 = $95,209,742 VALUE CONCLUSION Indicated Stabilized Value* $82,700,000 Stabilization Discount ($6,100,000) Indicated As Complete Value $76,600,000 Rounded $76,600,000 Value Per Room $255,333 Compiled by CBRE Please note that since the subject is not stabilized, we have made an adjustment for stabilization. This stabilization discount will be further discussed in the income approach section of this report. 42 © 2018 CBRE, IrK. CBRE Income Capitalization Approach Income Capitalization Approach The following map and table summarize the primary comparable data used in the valuation of the subject. A detailed description of each transaction is included in the addenda. D. LITTLE HALT I Nw ablI+ SE ;'INWOO6 r Ma�Arltlw�` Miami Dade College ,x4 - Wolfson Campus Q r$ 5 9r,9. DOWNTOWN MIAMI Miami Vizcaya Museum r' &.Gardens VENETIAN . ISLANDS (r.+z Dodge Island Mlam 15 I1 Sa SOUTH BEACH FLAMINGO LUMMUS 51t151[:j} Fisner island acvar Map 'r-ala . PRIMARY COMPETITIVE HOTELS 12 Months Ending January 31, 2018 Number Percentage Year Competitive Occupancy ADR RevPAR Property of Rooms Competitive Built Rooms Occ. Penetration ADR Penetration RevPAR Penetration Doubletree Grand Biscayne Bay 219 100% 1988 219 75% - 80% 90% - 100% $190 - $200 75% - 85% $145 - $155 75% - 85% Biscayne Bay Marriott Hotel & Manna 600 100% 1982 600 75% - 80% 90% - 100% $180 - $190 70% - 80% $140 - $145 70% - 80% Loews Miami Beach Hotel 790 100% 1998 790 80% - 85% 90% - 120% $300 - $310 105% - 135% $240 - $250 125% - 135% Maniott South Beach 224 100% 2000 224 75% - 80% 90% - 100% $270 - $280 105% - 135% $210 - $220 110% - 120% Courtyard Cadillac Miami Beach Oceanfront 356 100% 1940 356 75% - 80% 90% - 100% $175 - $185 70% - 80% $135 - $140 70% - 80% Primary Totals/Averages 2,189 2,189 75% $241.38 Overall Totals/Averages 2,189 2,189 79% $241.38 Compiled by CBRE PRIMARY COMPETITION Meeting Meeting Estimated 2018 Market Mix Space Space Corp. Business Sp Exercise Property Location (SF) (SFIRM) Individual Group Leisure Restaurant Lounge Center Pool a Facilities Doubletree Grand Biscayne Bay Miami, Florida 8,481 38.7 35% 30% 35% Y Y Y Y Y Y Biscayne Bay Maniott Hotel & Manna Miami, Florida 6,793 11.3 35% 40% 25% Y Y Y Y Y Y Loews Miami Beach Hotel Miami Beach, Fonda 65,000 82.3 15% 60% 25% Y Y Y Y Y Y Manion South Beach Miami Beach, Florida 2,600 11.6 20% 10% 70% Y Y Y Y Y Y Courtyard Cadillac Miami Beach Oceanfront Miami Beach, Florida 2,737 7.7 25% 20% 55% Y Y Y Y Y Y PnmaryTotals/Averages 25% 41% 34% Compiled by CBRE 43 0 2018 CBRE, Inc. CBRE Income Capitalization Approach SUMMARY OF COMPETITIVE PROPERTIES The primary competitive set, excluding the subject, has a total of 2,189 rooms. The trailing 12 month as of 1/31/2018 occupancy and ADR achieved by these properties was roughly 75% and $241.38, respectively. OCCUPANCY, ADR, AND REVPAR CONCLUSIONS The subject's occupancy, ADR, RevPAR, and corresponding room revenue for the first several years of our projection analysis are illustrated as follows and were discussed and analyzed in the hotel market analysis: OCCUPANCY, ADR, & ROOMS REVENUE CONCLUSIONS Fiscal Year Ending 12/31/ Avg. Available Rooms Annual Room Nights Occupancy Occupied Rooms ADR RevPAR RevPAR Growth Total Rooms Revenue Source: CBRE 2020 300 109,500 62% 67,890 $192.47 $119.33 $13,066,872 2021 300 109,800 72% 79,056 $202.09 $145.51 21.9% $15,976,806 2022 300 109,500 77% 84,315 $210.18 $161.84 11.2% $17,721,208 INCOME AND EXPENSE HISTORY Due to the proposed nature of the subject, no historical income and expense data is available. However, we have been provided a pro forma for the subject property. The historical information provided was not in all cases in the Uniform System of Accounts for the Lodging Industry. We have made adjustments where we could to rectify this issue. 44 0 2018 CBRE, Inc. CBRE Income Capitalization Approach SUBJECT OPERATING HISTORY Period Reported: Complete Calendar Year Ended: Complete Calendar Year Ended: Trailing 12 Months Ending: 12/31 /2019 12/31 /2020 12/31/2021 Days Open 365 366 365 No. of Rooms 300 300 300 Occupied Room Nights 71,175 71,175 82,125 Occupancy 65.0% 64.8% 75.0% Average Daily Rate $180.00 $185.00 $190.00 RevPAR $117.00 $119.92 $142.50 Based on Actual Through 11/30/16 With Estimated December Figures Total Ratio to Sales PAR POR Total Ratio to Sales PAR POR Total Ratio to Sales PAR POR REVENUE Rooms $12,811,500 64.1% $42,705 $180.00 $13,167,400 64.1% $43,891 $185.00 $15,603,800 64.1% $52,013 $190.00 Food & Beverage 5,124,600 25.6% $17,082 $72.00 5,267,000 25.6% $17,557 $74.00 6,241,500 25.6% $20,805 $76.00 Other Operated Departments 2,049,800 10.3% $6,833 $28.80 2,106,800 10.3% $7,023 $29.60 2,496,600 10.3% $8,322 $30.40 Total Operating Revenue $19,985,900 100.0% $66,620 $280.80 $20,541,200 100.0% $68,471 $288.60 $24,341,900 100.0% $81,140 $296.40 DEPARTMENTAL EXPENSES Rooms Expense Food & Beverage Expense Other Operated Departments Expense Total Departmental Expenses $3,202,900 25.0% $10,676 $45.00 $3,291,800 25.0% $10,973 $46.25 $3,900,900 25.0% $13,003 $47.50 $3,587,200 70.0% $11,957 $50.40 $3,686,900 70.0% $12,290 $51.80 4,369,100 70.0% $14,564 $53.20 $480,400 23.4% $1,601 $6.75 $493,800 23.4% $1,646 $6.94 585,100 23.4% $1,950 $7.12 $7,270,500 36.4% $24,235 $102.15 $7,472,500 36.4% $24,908 $104.99 $8,855,100 36.4% $29,517 $107.82 DEPARTMENTAL PROFIT $12,715,400 63.6% $42,385 $178.65 $13,068,700 63.6% $43,562 $183.61 $15,486,800 63.6% $51,623 $188.58 UNDISTRIBUTED OPERATING EXPENSES Administrative and General $4,996,500 25.0% $16,655 $70.20 $5,135,300 25.0% $17,118 $72.15 $6,085,500 25.0% $20,285 $74.10 Information and Telecommunications - 0.0% $0 $0.00 - 0.0% $0 $0.00 - 0.0% $0 $0.00 Marketing - 0.0% $0 $0.00 - 0.0% $0 $0.00 - 0.0% $0 $0.00 Franchise Fees - 0.0% $0 $0.00 - 0.0% $0 $0.00 - 0.0% $0 $0.00 Property Operations and Maintenance - 0.0% $0 $0.00 - 0.0% $0 $0.00 - 0.0% $0 $0.00 Utilities - 0.0% $0 $0.00 - 0.0% $0 $0.00 - 0.0% $0 $0.00 Total Undistributed Expenses $4,996,500 25.0% $16,655 $70.20 $5,135,300 25.0% $17,118 $72.15 $6,085,500 25.0% $20,285 $74.10 GROSS OPERATING PROFIT $7,718,900 38.6% $25,730 $108.45 $7,933,400 38.6% $26,445 $111.46 $9,401,300 38.6% $31,338 $114.48 Management Fee $599,600 3.0% $1,999 $8.42 $616,200 3.0% $2,054 $8.66 $730,300 3.0% $2,434 $8.89 INCOME BEFORE NON -OPERATING INCOME AND EXPENSES $7,119,300 35.6% $23,731 $100.03 $7,317,200 35.6% $24,391 $102.81 $8,671,000 35.6% $28,903 $105.58 NON -OPERATING INCOME AND EXPENSES Property Taxes $1,399,000 7.0% $4,663 $19.66 Insurance - 0.0% $0 $0.00 Reserve for Replacement 799,400 4.0% $2,665 $11.23 Total Non -Operating Income and Expenses Ground Rent NET INCOME (EBITDA) $1,232,500 6.0% $4,108 $17.32 $1,460,500 6.0% $4,868 $17.78 0.0% $0 $0.00 - 0.0% $0 $0.00 821,600 4.0% $2,739 $11.54 973,700 4.0% $3,246 $11.86 $2,198,400 11.0% $7,328 $30.89 $2,054,100 10.0% $6,847 $28.86 $2,434,200 10.0% $8,114 $29.64 $199,900 1.0% $666 $2.81 $205,400 1.0% $685 $2.89 $243,400 1.0% $811 $2.96 $4,721,000 23.6% $15,737 $66.33 $5,057,700 24.6% $16,859 $71.06 $5,993,400 24.6% $19,978 $72.98 Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; all others are based on total revenues. Source: Hotel Operating Statements 45 CBRE Income Capitalization Approach INCOME AND EXPENSE COMPARABLES This analysis incorporates revenue estimates based on our survey of comparable and competitive properties, and general market trend information. The revenue and expense comparisons include three resort hotels all located in the region. The comparable hotels' financial information is obtained primarily from confidential information submitted for the 2017 edition (2016 year-end data) of the PKF Consulting USA, LLC publication Trends in the Hotel Industry. For reasons of confidentiality, we have not disclosed the identity of the comparable hotels. The following charts summarize income and expenses taken from regional revenue/expense comparables as well as data from the PKF Trends report. 46 © 2018 CBRE, IrK. CBRE Income Capitalization Approach COMPARABLE INCOME AND EXPENSE DATA - SELECTED HOTELS Property Comparable 1 Comparable 2 Location Miami Miami Hotel Description / Name Full Service Full Service Year 2015 2016 Days Open 365 365 Occupancy 83.8% 84.5% Average Daily Rate $224.87 $196.44 REVENUE Rooms Food & Beverage Other Operated Departments Ratio to Sales PAR POR Ratio to Sales PAR POR 68.6 25.6 5.8 $68,803 $25,717 $5,843 $224.87 $84.05 $19.10 Total Operating Revenue 100.0 DEPARTMENTAL EXPENSES* Rooms Expense Food & Beverage Expense Other Operated Departments Expense 31.4% 76.8 61.4% $100,363 $328.02 $2'1 ,636 $'19, 762 $3,587 $70.71 $64.59 $'1 '1 .72 Total Departmental Expenses 44.8% $44,984 $147.02 DEPARTMENTAL PROFIT 55.2% $55,379 $181.00 55.4% $60,561 $196.44 38.0% $41, 523 $134.69 6.6% $7,266 $23.57 100.0% 27.2 63.2 34.9 $109,350 $354.70 $'16, 477 $26,234 $2,533 $53.45 $85.09 $8.22 41.4% $45,244 $146.76 58.6 $64,105 $207.94 UNDISTRIBUTED OPERATING EXPENSES Administrative and General 9.9% $9,897 $32.35 8.2% $8,980 $29.13 Information and Telecommunications Systems 0.0% $0 $0.00 0.0% $0 $0.00 Marketing 8.9% $8,908 $29.11 6.7% $7,279 $23.61 Franchise Fees 0.0% $0 $0.00 0.0% $0 $0.00 Property Operations and Maintenance 2.2% $2,245 $7.34 4.1% $4,450 $14.43 Utilities 2.8% $2,798 $9.14 3.6% $3,888 $12.61 Total Undistributed Expenses 23.8% $23,847 $77.94 GROSS OPERATING PROFIT 31.4% Management Fee $31,532 $103.06 22.5 $24,597 $79.78 36.1 $39,509 $128.15 0.0% $0 $0.00 2.1% $2,331 $7.56 INCOME BEFORE NON -OPERATING INCOME AND EXPENSES 31.4% $31,531 $103.06 34.0 $37,178 $120.59 NON -OPERATING INCOME AND EXPENSES Property Taxes 2.8% $2,815 $9.20 2.8% $3,081 $9.99 Insurance 1.8 % $1,836 $6.00 1.6 % $1,792 $5.81 Reserve for Replacement 0.0% $0 $0.00 0.0% $0 $0.00 Total Non -Operating Income and Expenses 4.6% $4,651 $15.20 $0 $0.00 Ground Rent 0.0% $0 $0.00 NET INCOME (EBITDA) 26.8% $26,880 $87.86 4.5 0.0 $4,872 $0 $0 $15.80 $0.00 $0.00 29.5 $32,306 $104.79 * Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; all others are based on total revenues. *" Sales and Marketing includes all Franchise Fees Source: Hotel Operating Statements 47 CBRE Income Capitalization Approach TRENDS® -SELECTED CATEGORIES Property Trends® Report - Weighted Average Full -Service Hotels - South Atlantic Full -Service Hotels - $125.00 to $250.00 Full -Service Hotels - 150 to 300 Rooms Full -Service Hotels Year 2016 2016 2016 2016 2016 Avg. No. of Rooms 240 230 270 211 247 Occupancy 75.3% 75.6% 75.6% 74.6% 75.2% Average Daily Rate $175.49 $155.88 $173.03 $189.10 $184.80 Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR REVENUE Rooms 71.0% $48,191 $175.49 69.8% $43,002 $155.88 70.9% $47,722 $173.03 72.8% $51,492 $189.10 70.5% $50,717 $184.80 Food and Beverage 24.7% $16,713 $60.84 25.9% $15,982 $57.93 24.9% $16,764 $60.78 22.6% $15,961 $58.61 25.0% $17,979 $65.51 Other Operated Departments 2.8% $1,904 $6.94 2.5% $1,532 $5.56 2.7% $1,821 $6.60 3.0% $2,142 $7.87 3.0% $2,137 $7.79 Rentals and Other (Net) 1.6% $1,089 $3.96 1.8% $1,090 $3.95 1.5% $1,001 $3.63 1.6% $1,148 $4.22 1.6% $1,132 $4.12 Total Operating Revenue 100.0% $67,896 $247.22 100.0% $61,606 $223.32 100.0% $67,309 $244.04 100.0% $70,742 $259.79 100.0% $71,965 $262.22 DEPARTMENTAL EXPENSES Rooms Expense Food and Beverage Expense Other Operated Departments Expense Total Departmental Expenses DEPARTMENTAL PROFIT 24.5% $11,798 $42.96 23.8% $10,220 $37.05 24.1% $11,483 $41.63 24.5% $12,611 $46.31 25.5% $12,918 $47.07 71.2% $11,906 $43.35 66.7% $10,654 $38.62 68.8% $11,532 $41.81 76.9% $12,278 $45.09 73.2% $13,163 $47.96 55.3% $1,063 $3.87 51.7% $792 $2.87 48.5% $883 $3.20 64.7% $1,386 $5.09 57.9% $1,237 $4.51 36.4% $24,767 $90.19 35.2% $21,666 $78.54 35.5% $23,897 $86.64 37.1% $26,274 $96.49 38.0% $27,317 $99.54 63.6% $43,130 $157.03 64.8% $39,941 $144.79 64.5% $43,411 $157.39 62.9% $44,468 $163.30 62.0% $44,648 $162.68 UNDISTRIBUTED OPERATING EXPENSES Administrative and General 7.9% $5,378 $19.59 7.9% $4,866 $17.64 7.7% $5,205 $18.87 8.2% $5,810 $21.34 7.9% $5,675 $20.68 Information and Telecommunications Systems 1.4% $975 $3.55 1.5% $903 $3.27 1.4% $943 $3.42 1.4% $1,005 $3.69 1.5% $1,053 $3.84 Marketing 9.0% $6,124 $22.30 9.4% $5,763 $20.89 8.9% $6,002 $21.76 9.3% $6,565 $24.11 8.6% $6,217 $22.65 Property Operations and Maintenance 4.1% $2,751 $10.01 4.1% $2,536 $9.19 4.0% $2,668 $9.67 4.1% $2,876 $10.56 4.1% $2,935 $10.69 Utilities 3.1% $2,104 $7.66 3.3% $2,027 $7.35 3.1% $2,067 $7.49 3.1% $2,179 $8.00 3.0% $2,153 $7.85 Total Undistributed Expenses 25.6% $17,333 $63.11 26.1% $16,095 $58.34 25.1% $16,885 $61.22 26.1% $18,434 $67.70 25.1% $18,034 $65.71 GROSS OPERATING PROFIT 38.0% $25,797 $93.92 38.7% $23,846 $86.44 39.4% $26,526 $96.18 36.8% $26,033 $95.61 37.0% $26,614 $96.97 Management Fee 3.7% $2,461 $8.96 3.7% $2,254 $8.17 3.7% $2,469 $8.95 3.6% $2,532 $9.30 3.6% $2,586 $9.42 INCOME BEFORE NON -OPERATING INCOME AND EXPENSES 34.4% $23,336 $84.96 35.0% $21,592 $78.27 35.7% $24,058 $87.23 33.2% $23,502 $86.31 33.4% $24,027 $87.55 NON -OPERATING INCOME AND EXPENSES Property Taxes 3.3% $2,278 $8.30 2.8% $1,747 $6.33 3.3% $2,229 $8.08 3.6% $2,543 $9.34 3.6% $2,601 $9.48 Insurance 0.8% $544 $1.98 0.9% $574 $2.08 0.7% $502 $1.82 0.8% $547 $2.01 0.8% $559 $2.04 Total Non -Operating Income and Expenses 7.3% $4,931 $17.96 7.0% $4,290 $15.55 7.1% $4,793 $17.38 7.8% $5,508 $20.23 7.2% $5,185 $18.89 NET INCOME (EBITDA) 27.2% $18,405 $67.00 28.1% $17,302 $62.72 28.6% $19,265 $69.85 25.4% $17,994 $66.08 26.2% $18,842 $68.65 Source: Trend® in the Hotel Industry USA Edition 2017, for the year 2016, CBRE Research/CBRE Hotels 48 CBRE Income Capitalization Approach DISCOUNTED CASH FLOW ANALYSIS The discounted cash flow analysis relies on a projection of net operating income over a fixed holding period and a future sale of the property at the end of the holding period. This is consistent with current investor trends for analyzing this property type. The discounted cash flow analysis takes into consideration the timing and degree of the projected changes in average daily rate, occupancy, and expenses for the subject. Financial Assumptions SUMMARY OF DISCOUNTED CASH FLOW INPUT General Start Date Mar-18 Terms of Analysis 10 Years Software Excel Growth Rates Stabilized ADR Growth 3.00% Stabilized Income Growth 3.00% Stabilized Expense Growth 3.00% Revenue Assumptions Year One Average Daily Rate $192.47 Stabilized Average Daily Rate $210.18 Occupancy Assumptions Year One Occupancy 62.00% Stabilized Occupancy 77.00% Estimated Stabilization Jan-22 Financial Discount Rate 10.50% Terminal Capitalization Rate 8.75% Other Cost of Sale 2.00% Capital Expenses (Property Improvement Plan Cost) $0 Compiled by CBRE CASH FLOW ASSUMPTIONS The discounted cash flow analysis relies on the income and expense projections presented earlier in this section. Specific assumptions integral to the analysis are summarized as follows: GENERAL ASSUMPTIONS The DCF analysis utilizes a 10-year projection period with fiscal year inflation and discounting. This is consistent with current investor assumptions. The analysis is done with Excel software. 49 0 2018 CBRE, Inc. CBRE Income Capitalization Approach GROWTH RATE ASSUMPTIONS The inflation and growth rates for the DCF analysis have been estimated by analyzing the expectations typically used by buyers and sellers in the local marketplace. Published investor surveys, an analysis of the Consumer Price Index (CPI), as well as CBRE's survey of brokers and investors active in the local market form the foundation for the selection of the appropriate growth rates. SUMMARY OF GROWTH RATES Investment Type U.S. Bureau of Labor Statistics (CPI-U) 10-Year Snapshot Average as of Expense Rent s Inflation Feb-18 1.64% PwC Real Estate Investment Survey: 1st Qtr. 2018 Luxury 3.83% 2.83% Full Service 3.50% 2.70% Limited Service 3.15% 2.95% Select Service 3.40% 2.75% CBRE Estimate 3.30% 3.00% 3.00% Compiled by: CBRE OCCUPANCY ASSUMPTIONS The occupancy rate over the holding period is based on the subject's estimated stabilized occupancy rate and estimated lease -up period to achieve a stabilized occupancy position. The complete discussion and analysis of occupancy is located in the Hotel Market Analysis. HOTEL INVESTOR RATES Provided on the following pages is a discussion of the direct capitalization, discount, and terminal capitalization rates. Direct Capitalization Direct capitalization is a method used to convert a single year's estimated stabilized net operating income into a value indication. The following subsections represent different techniques for deriving an overall capitalization rate for direct capitalization. This figure will be used in a direct capitalization table presented following the discounted cash flow analysis. It also impacts the terminal capitalization rate selection. 50 0 2018 CBRE, Inc. CBRE Income Capitalization Approach COMPARABLE CAPITALIZATION RATES Name Sale Location 1 Aloft Tampa Downtown, 100 West Kennedy Boulevard, Tampa, FL 2 Hilton University of Florida Conference Center, 1714 SW 34th Street, Gainesville, FL 3 Embassy Suites Orlando Downtown, 191 East Pine Street, Orlando, FL 4 Westin Tampa Harbour Island, 725 South Harbour Island Boulevard, Tampa, FL Sale Sale Price Date $/Unit Occupancy OAR Nov-15 $209,562 71% 8.01% Feb-16 $199,597 79% 7.42% Mar-16 $265.569 80% 7.58% Sep-16 S214.047 75% 8.51% Indicated OAR: 77% 7.42% •8.51% Compiled by: CBRE Below are the results of the national PWC Investment Survey for Hotels for the 1st quarter of 2018. We believe a rate slightly above the average for full -service hotels would be appropriate because of the subject's age and its location near downtown Miami as shown in the prior chart. OVERALL CAPITALIZATION RATES Investment Type PwC Real Estate Investment Survey: 1st Qtr. 2018 Luxury Full Service Limited Service Select Service Indicated OAR: 4.75% - 9.00% 6.00% - 10.00% 7.50% - 10.00% 5.00% - 11.00% Average 7.10% 7.71 % 8.95% 8.20% 8.50% Compiled by: CBRE As indicated above, we have selected an OAR within the range indicated by the PwC survey. OVERALL CAPITALIZATION RATES Respondent Paul Weimer Scott Stephens Indicated OAR: Compiled by: CBRE Company CBRE HREC OAR 8.00% - 9 8.00% - 9 Date of Survey .0% Jun-17 .0% Jun-17 8.50% We have utilized an OAR within the range indicated by the market participants. CAPITALIZATION RATE CONCLUSION The following table summarizes the OAR conclusions. 51 0 2018 CBRE, Inc. CBRE Income Capitalization Approach OVERALL CAPITALIZATION RATE - CONCLUSION Source Indicated OAR Comparable Sales 7.42% - 8.51% Published Surveys 8.50% Market Participants 8.50% CBRE Estimate 8.50% Compiled by: CBRE Discount Rate Analysis The results of the most recent PwC Real Estate Investor Survey are summarized in the following table. DISCOUNT RATES Investment Type Rate Range Average PwC Real Estate Investment Survey: 1st Qtr. 2018 Luxury 8.00%-12.00% 9.83% Full Service 8.75%- 13.00% 10.69% Limited Service 8.50%- 12.00% 10.55% Select Service 9.00%- 13.00% 10.90% CBRE Estimate Compiled by: CBRE 10.50% The subject is considered to be a full service property. Overall, a rate slightly below the average of the range indicated on the preceding table is considered appropriate for the following reasons: SUBJECT STRENGTHS • The subject is located on Watson Island within the Jungle Island Park and has excellent views of Biscayne Bay; • The subject is located near the Miami Beach and the Miami CBD; • The subject is located in a hotel market with strong occupancies and ADR; • The subject would be the only existing hotel on Watson Island which also has a marina and a Children's Marina within close proximity; • The subject should benefit from the anticipated improved economic climate that is projected in the next couple of years. SUBJECT WEAKNESSES • The property is located in a very competitive hotel market with most of the major franchises represented in the submarket; • The submarket has planned new hotel construction that is not considered to be competitive to the subject; Terminal Capitalization Rate The PwC Investment Survey results are shown below: 52 © 2018 CBRE, IrK. CBRE Income Capitalization Approach TERMINAL CAPITALIZATION RATES Investment Type Rate Range Average PwC Real Estate Investment Survey: 1st Qtr. 2018 Luxury 5.75% - 10.00% 7.38% Full Service 6.50% - 10.00% 8.31% Limited Service 7.75% - 11.00% 9.63% Select Service 6.00% - 11.00% 8.65% CBRE Estimate Compiled by: CBRE 8.75% Our estimate is comparable within the range of the results of the survey. DISCOUNTED CASH FLOW CONCLUSION The following pages present the following illustrations: • Discounted Cash Flow Schedule(s) • Discounted Cash Flow Value Conclusions 53 © 2018 CBRE, IrK. CBRE Income Capitalization Approach AS COMPLETE DISCOUNTED CASH FLOW SCHEDULE CBRE JUNGLE ISLAND PROPOSED HOTEL AS COMPLETE DISCOUNTED CASH FLOW ANALYSIS BEGINNING 01/20 CBRE HOTELS YEAR 1 2 3 4 5 6 7 8 9 10 Reversion Year Ended: 12/31 /20 12/31 /21 12/31 /22 12/31 /23 12/31 /24 12/31 /25 12/31 /26 12/31 /27 12/31 /28 12/31 /29 12/31 /30 Number of Rooms Annual Available Rooms Occupied Rooms Occupancy Average Rate REVENUE 300 300 300 300 300 300 300 300 300 300 300 109,500 109,800 109,500 109,500 109,500 109,500 109,500 109,500 109,500 109,500 109,500 67,890 79,056 84,315 84,315 84,315 84,315 84,315 84,315 84,315 84,315 84,315 62.0% 72.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% $192.47 $202.09 $210.18 $216.48 $222.98 $229.67 $236.56 $243.65 $250.96 $258.49 $266.25 Rooms $13,066,872 $15,976,806 $17,721,208 $18,252,844 $18,800,429 $19,364,442 $19,945,375 $20,543,736 $21,160,049 $21,794,850 $22,448,695 Food & Beverage $5,409,301 $6,270,840 $6,798,185 $7,002,130 $7,212,194 $7,428,560 $7,651,417 $7,880,959 $8,117,388 $8,360,910 $8,611,737 Other Operated Departments $2,184,442 $2,491,486 $2,683,391 $2,763,893 $2,846,810 $2,932,214 $3,020,181 $3,110,786 $3,204,110 $3,300,233 $3,399,240 Total Operating Revenue $20,660,615 $24,739,132 $27,202,783 $28,018,867 $28,859,433 $29,725,216 $30,616,972 $31,535,481 $32,481,546 $33,455,992 $34,459,672 DEPARTMENTAL EXPENSES Rooms Expense $3,622,681 $4,047,759 $4,251,913 $4,379,471 $4,510,855 $4,646,181 $4,785,566 $4,929,133 $5,077,007 $5,229,317 $5,386,197 Food & Beverage Expense 4,066,130 4,481,803 4,758,729 4,901,491 5,048,536 5,199,992 5,355,992 5,516,671 5,682,172 5,852,637 6,028,216 Other Operated Departments Expense 824,914 891,926 939,187 967,363 996,383 1,026,275 1,057,063 1,088,775 1,121,438 1,155,081 1,189,734 Total Departmental Expenses $8,513,725 $9,421,488 $9,949,830 $10,248,325 $10,555,774 $10,872,447 $11,198,621 $11,534,580 $11,880,617 $12,237,035 $12,604,146 DEPARTMENTAL PROFIT $12,146,889 $15,317,644 $17,252,954 $17,770,542 $18,303,659 $18,852,768 $19,418,351 $20,000,902 $20,600,929 $21,218,957 $21,855,526 UNDISTRIBUTED OPERATING EXPENSES - - - - - - - - - - Administrative and General 2,056,916 2,118,623 2,227,791 2,294,624 2,363,463 2,434,367 2,507,398 2,582,620 2,660,098 2,739,901 2,822,098 Information and Telecommunications Systems 290,606 299,324 318,120 327,663 337,493 347,618 358,046 368,788 379,851 391,247 402,984 Marketing 1,700,923 1,751,951 1,925,018 1,982,769 2,042,252 2,103,519 2,166,625 2,231,624 2,298,572 2,367,530 2,438,556 Property Operations and Maintenance 850,611 876,129 962,678 991,558 1,021,305 1,051,944 1,083,502 1,116,007 1,149,488 1,183,972 1,219,491 Utilities 668,609 688,667 724,152 745,877 768,253 791,301 815,040 839,491 864,676 890,616 917,334 Total Undistributed Expenses $5,567,665 $5,734,695 $6,157,758 $6,342,491 $6,532,766 $6,728,749 $6,930,611 $7,138,530 $7,352,686 $7,573,266 $7,800,464 GROSS OPERATING PROFIT $6,579,225 $6,776,601 $11,095,195 $11,428,051 $11,770,893 $12,124,020 $12,487,740 $12,862,372 $13,248,244 $13,645,691 $14,055,062 Management Fee 619,818 638,413 816,084 840,566 865,783 891,756 918,509 946,064 974,446 1,003,680 1,033,790 INCOME BEFORE NON -OPERATING INCOME AND EXPENSES 5,959,406 6,138,188 10,279,112 10,587,485 10,905,110 11,232,263 11,569,231 11,916,308 12,273,797 12,642,011 13,021,271 NON -OPERATING INCOME AND EXPENSES Property Taxes $1,273,933 $1,312,151 $1,351,515 $1,392,061 $1,433,823 $1,476,837 $1,521,142 $1,566,777 $1,613,780 $1,662,193 $1,712,059 Insurance $449,983 $463,482 $477,387 $491,708 $506,460 $521,653 $537,303 $553,422 $570,025 $587,126 $604,739 Reserve for Replacement $826,425 $851,217 $1,088,111 $1,120,755 $1,154,377 $1,189,009 $1,224,679 $1,261,419 $1,299,262 $1,338,240 $1,378,387 Total Non -Operating Income and Expenses $2,550,340 $2,626,850 $2,917,013 $3,004,524 $3,094,660 $3,187,499 $3,283,124 $3,381,618 $3,483,067 $3,587,559 $3,695,185 Ground Rent $256,412 $264,105 $272,028 $280,189 $288,594 $297,252 $306,170 $315,355 $324,815 $334,560 $344,597 NET INCOME (EBITDA) 3,152,654 3,247,233 7,090,071 7,302,773 7,521,856 7,747,512 7,979,937 8,219,335 8,465,915 8,719,893 8,981,489 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $o Total Revenue REVENUE AND NOI TREND Sale / Yield Matrix Total Expenses NOI 1 f 4 1 f 1 1 1 ■ 10 IRR 10.25% 10.75% 10.75% 8.50% Terminal C. Rate 8.75% 9.00% 78,323,824 77,208,756 76,155,636 76,965,003 75,874,907 74,845,372 75,636,114 74,570,377 73,563,847 Reconciled Value Indication: As Complete Value Indication (Rounded): $75,874,907 $75,900,000 $253,000/Room 54 CBRE Income Capitalization Approach PROSPECTIVE AS STABILIZED DISCOUNTED CASH FLOW SCHEDULE CBRE YEAR Year Ended: Number of Rooms Annual Available Rooms Occupied Rooms Occupancy Average Rate REVENUE JUNGLE ISLAND PROPOSED HOTEL DISCOUNTED CASH FLOW ANALYSIS BEGINNING 01/22 CBRE HOTELS 1 2 3 4 5 6 7 8 9 10 Reversion 12/31/22 12/31/23 '12/31/24 12/31/25 12/31/26 12/31/27 12/31/28 12/31/29 12/31/30 12/31/31 12/31/32 300 300 300 300 300 300 300 300 300 300 300 109,500 109,500 109,500 109,500 109,500 109,500 109,500 109,500 109,500 109,500 109,500 84,315 84,315 84,315 84,315 84,315 84,315 84,315 84,315 84,315 84,315 84,315 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% 77.0% $210.18 $216.48 $222.98 $229.67 $236.56 $243.65 $250.96 $258.49 $266.25 $274.24 $282.46 Rooms $17,721,208 $18,252,844 $18,800,429 $19,364,442 $19,945,375 $20,543,736 $21, 160,049 $21,794,850 $22,448,695 $23,122,156 $23,815,821 Food & Beverage 6,798,185 7,002,130 7,212,194 7,428,560 7,651,417 7,880,959 8,1 17,388 8,360,910 8,61 1,737 8,870,089 9,136,192 Other Operated Departments 2,683,391 2,763,893 2,846,810 2,932,214 3,020,181 3,110,786 3,204,110 3,300,233 3,399,240 3,501,217 3,606,253 Total Operating Revenue $27,202,783 $28,018,867 $28,859,433 $29,725,216 $30,616,972 $31,535,481 $32,481,546 $33,455,992 $34,459,672 $35,493,462 $36,558,266 DEPARTMENTAL EXPENSES Rooms Expense $4,251,913 $4,379,471 $4,510,855 $4,646,181 $4,785,566 $4,929,133 $5,077,007 $5,229,317 $5,386,197 $5,547,783 $5,714,216 Food & Beverage Expense 4,758,729 4,901,491 5,048,536 5,199,992 5,355,992 5,516,671 5,682,172 5,852,637 6,028,216 6,209,062 6,395,334 Other Operated Departments Experts 939,187 967,363 996,383 1,026,275 1,057,063 1,088,775 1,121,438 1,155,081 1,189,734 1,225,426 1,262,189 Total Departmental Expenses $9,949,830 $10,248,325 $10,555,774 $10,872,447 $11,198,621 $11,534,580 $11,880,617 $12,237,035 $12,604,146 $12,982,271 $13,371,739 DEPARTMENTAL PROFIT $17,252,954 $17,770,542 $18,303,659 $18,852,768 $19,418,351 $20,000,902 $20,600,929 $21,218,957 $21,855,526 $22,511,191 $23,186,527 UNDISTRIBUTED OPERATING EXPENSES Administrative and General $2,227,791 $2,294,624 $2,363,463 $2,434,367 $2,507,398 $2,582,620 $2,660,098 $2,739,901 $2,822,098 $2,906,761 $2,993,964 Information and Telecommunications Systems 318,120 327,663 337,493 347,618 358,046 368,788 379,851 391,247 402,984 415,074 427,526 Marketing 1,925,018 1,982,769 2,042,252 2,103,519 2,166,625 2,231,624 2,298,572 2,367,530 2,438,556 2,511,712 2,587,064 Property Operations and Maintenance 962,678 991,558 1,021,305 1,051,944 1,083,502 1,116,007 1,149,488 1,183,972 1,219,491 1,256,076 1,293,758 Utilities 724,152 745,877 768,253 791,301 815,040 839,491 864,676 890,616 917,334 944,854 973,200 Total Undistributed Expenses $6,157,758 $6,342,491 $6,532,766 $6,728,749 $6,930,611 $7,138,530 $7,352,686 $7,573,266 $7,800,464 $8,034,478 $8,275,512 GROSS OPERATING PROFIT $11,095,195 $11,428,051 $11,770,893 $12,124,020 $12,487,740 $12,862,372 $13,248,244 $13,645,691 $14,055,062 $14,476,713 $14,911,015 Management Fee $816,084 $840,566 $865,783 $891,756 $918,509 $946,064 $974,446 $1,003,680 $1,033,790 $1,064,804 $1,096,748 INCOME BEFORE NON - OPERATING INCOME AND EXPENSES $10,279,112 $10,587,485 $10,905,110 $11,232,263 $11,569,231 $11,916,308 $12,273,797 $12,642,011 $13,021,271 $13,411,910 $13,814,267 NON -OPERATING INCOME AND EXPENSES Property Taxes $1,351,515 $1,392,061 $1,433,823 $1,476,837 $1,521, 142 $1,566,777 $1,613,780 $1,662,193 $1,712,059 $1,763,421 $1,816,324 Insurance 477,387 491,708 506,460 521,653 537,303 553,422 570,025 587,126 604,739 622,882 641,568 Reserve for Replacement 1,088,111 1,120,755 1,154,377 1,189,009 1,224,679 1,261,419 1,299,262 1,338,240 1,378,387 1,419,738 1,462,331 Total Non -Operating Income and Expenses $2,917,013 $3,004,524 $3,094,660 $3,187,499 $3,283,124 $3,381,618 $3,483,067 $3,587,559 $3,695,185 $3,806,041 $3,920,222 Ground Rent $272,028 $280,189 $288,594 $297,252 $306,170 $315,355 $324,815 $334,560 $344,597 $354,935 $365,583 NET INCOME (EBITDA) 7,090,071 7,302,773 7,52'1,856 7,747,5'12 7,979,937 8,219,335 8,465,915 8,719,893 8,98'1,489 9,250,934 9,528,462 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 Total Revenue REVENUE AND NOI TREND Sale / Yield Matrix Total Expenses NOI III 2 3 4 Vear 6 7 8 9 10 IRR 10.25% '10.75 10.75% 8.50% Terminal Cap Rate 8.75% 9.00% 89,664,760 88,481,784 87,364,529 88,201,155 86,769,438 87,044,673 85,638,797 85,952,439 84,570,970 Reconciled Value Indication: As -Stabilized Value Indication (Rounded): $87,044,673 $87,000,000 $290,000/Room 55 CBRE Income Approach DIRECT CAPITALIZATION SUMMARY A summary of the direct capitalization of the subject is illustrated in the following table. DIRECT CAPITALIZATION SUMMARY Analysis Premise Discounted Cash Flow YR 3 Income Period Ending: 12/31/2022 Number of Rooms: 300 Annual Rooms Available: 109,500 Occupied Rooms: 84,315 Occupancy: 77.0% Average Rate: $210.18 RevPAR: $161.84 Total Ratio to Sales PAR POR REVENUE Rooms $17,721,208 65.1% $59,071 $210.18 Food & Beverage $6,798,185 25.0% 22,661 80.63 Other Operated Departments $2,683,391 9.9% 8,945 31.83 Total Operating Revenue $27,202,783 100.0% $90,676 $322.63 DEPARTMENTAL EXPENSES Rooms Expense $4,251,913 24.0% $14,173 $50.43 Food & Beverage Expense $4,758,729 70.0% 15,862 56.44 Other Operated Departments Expense $939,187 35.0% 3,131 11.14 Total Departmental Expenses $9,949,830 36.6% $33,166 $118.01 DEPARTMENTAL PROFIT $17,252,954 63.4% $57,510 $204.62 UNDISTRIBUTED OPERATING EXPENSES Administrative and General $2,227,791 8.2% $7,426 $26.42 Information and Telecommunications Systems $318,120 1.2% 1,060 3.77 Marketing $1,925,018 7.1% 6,417 22.83 Property Operations and Maintenance $962,678 3.5% 3,209 11.42 Utilities $724,152 2.7% 2,414 8.59 Total Undistributed Expenses $6,157,758 22.6% $20,526 $73.03 GROSS OPERATING PROFIT $11,095,195 40.8% $36,984 $131.59 Management Fee $816,084 3.0% $2,720 $9.68 INCOME BEFORE NON -OPERATING INCOME AND EXPENSES $10,279,112 37.8% $34,264 $121.91 NON -OPERATING INCOME AND EXPENSES Property Taxes $1,351,515 5.0% $4,505 $16.03 Insurance $477,387 1.8% 1,591 5.66 Reserve for Replacement $1,088,111 4.0% 3,627 12.91 Total Non -Operating Income and Expenses $2,917,013 10.7% $9,723 $34.60 NET INCOME (EBITDA) $7,090,071 26.1% $23,634 $84.09 Net Income (EBITDA) $7,090,071 OAR / 8.50% Indicated Prospective Stabilized Value $83,412,596 Rounded $83,400,000 Stabilization Discount (6,100,000) Indicated As Complete Value $77,312,596 Rounded $77,300,000 Value Per Room $257,667 * Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; Compiled by CBRE 56 CBRE Income Approach CONCLUSION OF INCOME CAPITALIZATION APPROACH The conclusions via the valuation methods employed for this approach are as follows: INCOME CAPITALIZATION APPROACH VALUES Prospective As Complete on January 1, 2020 Prospective As Stabilized on January 1, 2022 Direct Capitalization Method Discounted Cash Flow Analysis Reconciled Value Compiled by CBRE $77,300,000 $75,900,000 $76,600,000 $83,400,000 $87,000,000 $85,200,000 Equal emphasis has been placed on both techniques as they are both considered to reflect the actions of buyers and sellers currently active in this market. The subject is not stabilized. A deduction for losses occurring during stabilization is necessary. This is calculated based on the differential in indicated value between the DCF's Prospective As Stabilized (deflated to same year dollars). The following depicts this calculation. The indicated stabilization discount is then utilized with the direct capitalization method, and the sales comparison approach to provide an indication of the As Complete value estimate. STABILIZATION SUMMARY Stabilization Period DCF - As Stabilized value DCF - As Stabilized value (Discounted Back to As Complete Dollars) DCF - As Complete value 24 Months $87,000,000 $82, 005, 844 $75,900,000 Stabilization Discount $6,105,844 Stabilization Discount (Rounded) $6,100,000 Compiled by CBRE It should be noted that we have used a deflated basis for the Prospective As Stabilized value estimate in order to properly compare it to the As Complete value estimate. Therefore, we have deflated the Prospective As Stabilized value estimate two years at the projected rate of inflation of 3.0% per year. 57 0 2018 CBRE, Inc. CBRE Reconciliation of Value Reconciliation of Value The value indications from the approaches to value are summarized as follows: SUMMARY OF VALUE CONCLUSIONS As Is on March 20, 2018 Prospective As Complete on January 1, 2020 Prospective As Stabilized on January 1, 2022 Land Value Cost Approach Sales Comparison Approach Income Capitalization Approach Reconciled Value Compiled by CBRE $14,300,000 $14,300,000 $71,000,000 $76,600,000 $76,600,000 $76,600,000 $77,100,000 $82,700,000 $85,200,000 $85,200,000 In valuing the subject, the Income Approach is considered most reliable and has been given primary emphasis, with secondary emphasis placed on the Sales Comparison Approach which was primarily utilized as a check of reasonableness in this appraisal. Based on the foregoing, the market value of the subject has been concluded as follows: MARKET VALUE CONCLUSION Appraisal Premise Interest Appraised Date of Value Value Conclusion As is - Land Prospective As Complete Prospective As Stabilized Ground Rent Leasehold Interest March 20, 2018 $14,300,000 Leasehold Interest January 1, 2020 $76,600,000 Leasehold Interest January 1, 2022 $85,200,000 Leasehold Interest March 20, 2018 $1,215,500 Compiled by CBRE The opinion(s) of market value includes the land, the improvements thereto, and the contributory value of the furniture, fixtures, and equipment. The appraisers assume that the hotel will be, and shall remain, open and operational. 58 © 2018 CBRE, 8K. CBRE Ground Rent Estimate Real Property Value Allocation PERSONAL PROPERTY Lodging facilities personal property consists of furnishings, fixtures and equipment (FF&E). These assets are difficult to isolate from the value of an operating hotel/motel property. Personal property is an integral part of a lodging facility. Without furniture, fixtures, and equipment, a hotel could not operate its facilities and rent its guest rooms, and thus would not be able to generate any income attributable to real property. Personal property and real property are uniquely combined in a hotel or motel; unlike an office or other commercial building, a hotel would have to close its doors without furniture, fixtures and equipment. The physical separation of personal property from real property in a hotel is a theoretical rather than a practical matter. Lodging facilities are generally sold with their furniture, fixtures, and equipment in place. While a lender may be restricted from financing the purchase of personal property, without personal property, a hotel's real property would have little value. Several methods are used to determine the market value of the furniture, fixtures, and equipment. A recommended approach is to use the depreciated replacement cost. As hotels are typically sold with the FF&E in place, a sale of just the FF&E usually takes place as a salvage or liquidation sale, which results in substantially less value than if in place and contributing to the hotel operation. The estimation of the market value of the tangible personal property is an allocation of the total value and is not likely to be a distinct component of a typical real estate transaction of an ongoing operation. The following depicts a collection of available data and the concluded FF&E cost estimate. FF&E COST ESTIMATE Source Per Guest Roorr CBRE Estimate $17,500 Indicated FF&E Replacement Cost $5,250,000 Compiled by CBRE For our analysis, we have indicated a figure of $17,500 per unit, which corresponds to $5,250,000. 59 0 2018 CBRE, Inc. CBRE Ground Rent Estimate FF&E VALUE ESTIMATE As Is on March 20, 2018 FF&E Effective Age (Weighted) 0 Years MVS Expected Life (Weighted) 8 Years FF&E Physical Depreciation 0% MVS Salvage Value of FF&E 10% FF&E Replacement Cost New $ 5,250,000 Less: Salvage Value $ (525,000) Depreciable Cost $ 4,725,000 Less Depreciation $ - Plus Salvage Value $ 525,000 Depreciated FF&E Cost $ 5,250,000 Rounded $ 5,300,000 Depreciated FF&E Cost Per Guest Room $17,667 Compiled by CBRE BUSINESS VALUE Hotels are undisputedly a combination of business and real estate: the day-to-day operation of a hotel represents a business over and above the real estate value. The estimate of value for the business interest component of the going concern value is considerably more subjective than the personal property value estimate. This is due to the intangible nature of the business interest. Numerous theories have been developed over time in an attempt to isolate the business component of a hotel. When hotels were routinely leased to hotel operators, separating the income and value attributable to each component was a simple matter. However, during the 1970's, the hotel property leases were replaced with the hotel management contract. It is widely accepted today that managing agents are hired by hotel owners to operate a property in return for a management fee. The fee is paid to the operator as an operating expense, and what remains is net income available to pay debt service and generate a return on the owner's equity. Purchasers of hotels as real estate investments are able to passively own the property by employing a managing agent, as is the case at the Subject. The real and personal property components of the Subject have already been valued in this appraisal, in isolation of any business component, through the deduction of market rate management and franchise fees. By making these deductions, we believe that there is no business value included in our conclusion of market value given previously. VALUE ALLOCATION CONCLUSION Based on the foregoing, the value allocation of the subject has been concluded as follows: 60 0 2018 CBRE, Inc. CBRE Ground Rent Estimate PROSPECTIVE AS COMPLETE VALUE ALLOCATION Interest Appraised - Allocation Value Conclusion Leasehold Interest As Complete Value $76,600,000 Personal Property $5,300,000 Business Enterprise Value $0 Real Property Value - As Complete $71,300,000 Compiled by CBRE 61 © 2018 CBRE, 8K. CBRE Ground Rent Estimate Ground Rent Estimate At the request of the client, we have been asked to estimate the market rent for the subject site (ground rent) via the income approach by performing a traditional market rent survey of comparable retail, entertainment and waterfront ground lease transactions, as presented in the following table. SUMMARY OF COMPARABLE GROUND LEASES Year Land Area Building Area Lease Term Base Rent Base Rent No. Property Location Lease Date Type and Use Built Occupancy (SF) (SF) (Years) Land Area Bldg. Area 1 Wal-Mart Neighborhood Market 6991 SW 8th Dec-14 Retail Destination 2014 100% 296,644 786,258 20.0 $1.35 $7.39 Street, Miami, FL 2 CVS Pharmacy 1204 SW 8th Dec-11 Retail 2013 100 % 95,396 271,771 25.0 $7.54 $7.54 Street, Miami, FL. Convenience 3 CVS Pharmacy 700 SW 27nd May-14 Retail 2014 100% 77,850 267,458 45.0 $9.31 $9.31 Avenue, Miami, FL. Convenience 4 Bayside Marketplace Biscayne Blvd., Miami, FL. 401 Aug-14 Festival Market& 1987 t00% 569,634 379,611 99.0 $6.17 $10.71 Touris Attraction 5 Grove BayWaterfront Land Lease 3349-2855 Pan Jun-16 Mixed -Use 1982 t00% 307,708 N/A 50.0 $4.55 N/A American Dr., Miami, FL. Waterfront Subject 1111 Parrot Jungle Trail. Miami, Florida Tourist Attraction -- -- 104,369 425,000* 49.0 Hotel Adjusted sale price for cash equivalency and/or development costs (where applicable) *Subject Building Area Estimated Compiled by CBRE DISCUSSION/ANALYSIS OF RENT COMPARABLES Overall, the comparables produced a rental rate range from approximately $400,000 to $725,000, and an outlier of $3,515,000 as produced by the Bayside Marketplace lease renegotiation / extension, or $1.11 to $9.31 per square foot of net site area, excluding any submerged lands. Based on the subject's location on Biscayne Bay, site size, location and highest & best use As Proposed, the market rent should fall above Rent Comparables 1, 2 & 3, and somewhere near rent comp 4. RENT MULTIPLIER METHOD As a gross check to the preceding market rent comparison technique, we have also employed a rent multiplier method in order to determine market rent. The rent multiplier method is based on the difference or spread between the agreed upon rental rate and the overall capitalization rate used to determine prospective value of what an investor would pay for a leased fee investment to an end buyer and represents the profit expectation that a developer would require in order to secure a prime tract of land, negotiate a long term ground lease with a good quality tenant and perform earthwork & site improvements, if necessary, in order to secure a long term ground lease. An appropriate profit spread for a ground lease transaction of this type would be between 200 and 300 basis points between rent multiplier and overall capitalization rate. In order to determine a reasonable overall capitalization rate we have presented the following national investor survey for triple net lease and land lease investors: 62 0 201 8 CBRE, Inc. CBRE Ground Rent Estimate ReaItRates omINVESTOR SURVEY - 1st Quarter 2017- LAND LEASES Pr pert T,p Capitalization Rates Discount Rates I Min_ Max_ Aug_ Min_ Max_ Aug_ Apartments Golf Health C7@S@NorHouan 2.44% 2.60% 2.60% 11.27 % 16.3 0 % 12.8 4 % 6.5 5 % 5.0 4% 11.7 7 % 9.1 9 7.3 8 % 5.2 O% 5.2 O% 16.8 O % 13.14 % 7.5 5% 10.19 8.3 8% hd kraI Lodging Mobile H om@ARV Park Office 2.60% 11.77 % 15.9 8 % 13.15 % 11.77 % 6.9 9 % 7.6 8 % 5.2 O% 5.2 O% 7.9 8 % 5.2 O% 7.4 9 % 5.2 O% 12.2 7 % 16.4 8 % 13.8 5 % 12.2 7 % Re hJant Retail 2.70% 2.49% 15.4 O % 12.6 4 % 8.7 4 % 6.3 O% 7.13% 5.09% 15.9 O % 13.14 % Self -Storage 2.60% 11.77 % 8.1 2 5.2 0% 12.2 7 % Special R urpose 3.55% 16.3 4 % 8.8 2 % e.3 2% 18.72 % 7.9 9% 8.6 3 ' 8.9 8% 8.4 9 9.7 4% 8.13% g.12k 9.44% All Prop erties 2.44% 16.34 % 7.8 2 % 5.0 4% 16.80 % 8.7 2% '41.th A_ t.r206Data cc.pr#t201 RaltyRa mTH 6 C BR E Ground Rent Estimate neaIt Ra(es_Gom INVESTOR SURVEY - 1st Quarter 2018- LAND LEASES Proper tg Ty ■ Capitalization Rats Discount Rates Min_ Max_ Avg_ Min_ Max_ Avg_ A partm e nti Golf 2.4 7% 10.6 4% 6.5 1% 2.9 7% 18.8 O% 8.90 % 5.0 7 % 11.14% 7.51% 5.57% Ego% 9.90% Health C 2WS@HorHousing IndusbaI Lodging Mobile H o me RV Park Office Re ray Retail Self -Storage Special urpose All Properties 2.9 9 12.01% 7.20 5.5 9 % 12.51 8.20 x 2.5 9 . 2.9 9 2.79% 2.7 7% 10.6 4 % 15.93x 13.15% 10.6 4 % 8.8 7 % 7.47 x 7.8 4 % 7.O 1% 8.15% 2.51% 2.81% 3.2 5% 15.8 9 % 12.01% 10.6 4 % 18.10% 8.35 % 6.98 % 7.99 • 8.75 % 5.1 9 % 11.14% 5.59% 1843% 5.39% 13.65% 5.3 7 % 11.14% 5.75% m$qk 5.11% 12.51% 5.41% 11.14% 6.34% 1872% 2.4 7% 16.8 O % 7.62 % 7.87 % 8.84 % 8.01% 9.85 % 7.98 % 8.99 % 9.45 % 5.07% Ego% E5 % '41.th Qur u 2017 O ti Cop 'right2018 Re�It»R,t�,.�omTII As shown in the chart above, a land lease transaction for a lodging facility typically average around 7.47%. Due to the subject's location on Biscayne Bay and its attachment to Jungle Gland, we have utilized an appropriate overall rate of approximately 6.5° for the subject ground lease. Hence, a 6 5° overall capitalization rate expectation plus 200 basis points spread for profit expectation would produce a rent multiplier of 8.5. MARKET RENT ESTIMATE The following chart shows the reconciled market rent conclusions for the subject properties based on our market rent survey and rent multiplier method: RENT MULTIPLIER METHOD - JUNGLE ISLAND PROPOSED HOTEL Rent Multiplier Land Value 0.085 Indicated Market Rent As Is: Indicated Market RentPSE Compiled by CBRE X $14,300,000 Potential Rent $1,215,500 $1,215,500 etS Itshould be also noted, our market rent conclusions assume a for -profit, full service hotel development with accssto the adjacent Jungle Park elements. 6 CBRE Ground Rent Estimate When we compare the appropriate gross ground rent to the subject projected revenue we can estimate the proper percentage rent that should be utilized in order to achieve the appropriate ground rent this percentage amount can be calculated. Analysis of Necessary Percentage Rent Year of Operation Year 1 Year2 Year3 Year4 Years Year6 Year7 Year8 Year9 Year 10 Gross Revenue $20,660,615 $24,739,132 $27,202,783 $28,018,867 $28,859,433 $29,725,216 $30,616,972 $31,535,481 $32,481,546 $33,455,992 Net Revenue $3,152,654 $3,247,233 $7,090,071 $7,302,773 $7,521,856 $7,747,512 $7,979,937 $8,219,335 $8,465,915 $8,719,893 FIXED PAYMENT Required % Rent of Gross Revenue 5.9% 4.9% 4.5% 4.3% 4.2% 4.1% 4.0% 3.9% 3.7% 3.6% Required % Rent of Net Revenue 38.6% 37.4% 17.1% 16.6% 16.2% 15.7% 15.2% 14.8% 14.4% 13.9% INFLATED PAYMENT Required % Rent of Gross Revenue 5.9% 5.1 % 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% Required % Rent of Net Revenue 38.6% 38.6% 18.2% 18.2% 18.2% 18.2% 18.2% 18.2% 18.2% 18.2% Source. CBRE Based upon our analysis, it would appear that the proper percentage rent would be approximately 5.0% of the Gross Revenue generated at the proposed subject property. 65 © 2018 CBRE, IrK. CBRE Assumptions and Limiting Conditions Assumptions and Limiting Conditions 1. CBRE, Inc. through its appraiser (collectively, "CBRE") has inspected through reasonable observation the subject property. However, it is not possible or reasonably practicable to personally inspect conditions beneath the soil and the entire interior and exterior of the improvements on the subject property. Therefore, no representation is made as to such matters. 2. The report, including its conclusions and any portion of such report (the "Report"), is as of the date set forth in the letter of transmittal and based upon the information, market, economic, and property conditions and projected levels of operation existing as of such date. The dollar amount of any conclusion as to value in the Report is based upon the purchasing power of the U.S. Dollar on such date. The Report is subject to change as a result of fluctuations in any of the foregoing. CBRE has no obligation to revise the Report to reflect any such fluctuations or other events or conditions which occur subsequent to such date. 3. Unless otherwise expressly noted in the Report, CBRE has assumed that: (i) Title to the subject property is clear and marketable and that there are no recorded or unrecorded matters or exceptions to title that would adversely affect marketability or value. CBRE has not examined title records (including without limitation liens, encumbrances, easements, deed restrictions, and other conditions that may affect the title or use of the subject property) and makes no representations regarding title or its limitations on the use of the subject property. Insurance against financial loss that may arise out of defects in title should be sought from a qualified title insurance company. (ii) Existing improvements on the subject property conform to applicable local, state, and federal building codes and ordinances, are structurally sound and seismically safe, and have been built and repaired in a workmanlike manner according to standard practices; all building systems (mechanical/electrical, HVAC, elevator, plumbing, etc.) are in good working order with no major deferred maintenance or repair required; and the roof and exterior are in good condition and free from intrusion by the elements. CBRE has not retained independent structural, mechanical, electrical, or civil engineers in connection with this appraisal and, therefore, makes no representations relative to the condition of improvements. CBRE appraisers are not engineers and are not qualified to judge matters of an engineering nature, and furthermore structural problems or building system problems may not be visible. It is expressly assumed that any purchaser would, as a precondition to closing a sale, obtain a satisfactory engineering report relative to the structural integrity of the property and the integrity of building systems. (iii) Any proposed improvements, on or off -site, as well as any alterations or repairs considered will be completed in a workmanlike manner according to standard practices. (iv) Hazardous materials are not present on the subject property. CBRE is not qualified to detect such substances. The presence of substances such as asbestos, urea formaldehyde foam insulation, contaminated groundwater, mold, or other potentially hazardous materials may affect the value of the property. (v) No mineral deposit or subsurface rights of value exist with respect to the subject property, whether gas, liquid, or solid, and no air or development rights of value may be transferred. CBRE has not considered any rights associated with extraction or exploration of any resources, unless otherwise expressly noted in the Report. (vi) There are no contemplated public initiatives, governmental development controls, rent controls, or changes in the present zoning ordinances or regulations governing use, density, or shape that would significantly affect the value of the subject property. (vii) All required licenses, certificates of occupancy, consents, or other legislative or administrative authority from any local, state, nor national government or private entity or organization have been or can be readily obtained or renewed for any use on which the Report is based. (viii)The subject property is managed and operated in a prudent and competent manner, neither inefficiently or super -efficiently. (ix) The subject property and its use, management, and operation are in full compliance with all applicable federal, state, and local regulations, laws, and restrictions, including without limitation environmental laws, seismic hazards, flight patterns, decibel levels/noise envelopes, fire hazards, hillside ordinances, density, allowable uses, building codes, permits, and licenses. (x) The subject property is in full compliance with the Americans with Disabilities Act (ADA). CBRE is not qualified to assess the subject property's compliance with the ADA, notwithstanding any discussion of possible readily achievable barrier removal construction items in the Report. (xi) All information regarding the areas and dimensions of the subject property furnished to CBRE are correct, and no encroachments exist. CBRE has neither undertaken any survey of the boundaries of the subject property nor reviewed or confirmed the accuracy of any legal description of the subject property. 66 CBRE Assumptions and Limiting Conditions Unless otherwise expressly noted in the Report, no issues regarding the foregoing were brought to CBRE's attention, and CBRE has no knowledge of any such facts affecting the subject property. If any information inconsistent with any of the foregoing assumptions is discovered, such information could have a substantial negative impact on the Report. Accordingly, if any such information is subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. CBRE assumes no responsibility for any conditions regarding the foregoing, or for any expertise or knowledge required to discover them. Any user of the Report is urged to retain an expert in the applicable field(s) for information regarding such conditions. 4. CBRE has assumed that all documents, data and information furnished by or behalf of the client, property owner, or owner's representative are accurate and correct, unless otherwise expressly noted in the Report. Such data and information include, without limitation, numerical street addresses, lot and block numbers, Assessor's Parcel Numbers, land dimensions, square footage area of the land, dimensions of the improvements, gross building areas, net rentable areas, usable areas, unit count, room count, rent schedules, income data, historical operating expenses, budgets, and related data. Any error in any of the above could have a substantial impact on the Report. Accordingly, if any such errors are subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. The client and intended user should carefully review all assumptions, data, relevant calculations, and conclusions of the Report and should immediately notify CBRE of any questions or errors within 30 days after the date of delivery of the Report. 5. CBRE assumes no responsibility (including any obligation to procure the same) for any documents, data or information not provided to CBRE, including without limitation any termite inspection, survey or occupancy permit. 6. All furnishings, equipment and business operations have been disregarded with only real property being considered in the Report, except as otherwise expressly stated and typically considered part of real property. 7. Any cash flows included in the analysis are forecasts of estimated future operating characteristics based upon the information and assumptions contained within the Report. Any projections of income, expenses and economic conditions utilized in the Report, including such cash flows, should be considered as only estimates of the expectations of future income and expenses as of the date of the Report and not predictions of the future. Actual results are affected by a number of factors outside the control of CBRE, including without limitation fluctuating economic, market, and property conditions. Actual results may ultimately differ from these projections, and CBRE does not warrant any such projections. 8. The Report contains professional opinions and is expressly not intended to serve as any warranty, assurance or guarantee of any particular value of the subject property. Other appraisers may reach different conclusions as to the value of the subject property. Furthermore, market value is highly related to exposure time, promotion effort, terms, motivation, and conclusions surrounding the offering of the subject property. The Report is for the sole purpose of providing the intended user with CBRE's independent professional opinion of the value of the subject property as of the date of the Report. Nothing contained in the Report shall be construed as any direct or indirect recommendation of CBRE to buy, sell, hold, or finance the subject property. 9. No opinion is expressed on matters which may require legal expertise or specialized investigation or knowledge beyond that customarily employed by real estate appraisers. Any user of the Report is advised to retain experts in areas that fall outside the scope of the real estate appraisal profession for such matters. 10. CBRE assumes no responsibility for any costs or consequences arising due to the need, or the lack of need, for flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to determine the actual need for Flood Hazard Insurance. 11. Acceptance or use of the Report constitutes full acceptance of these Assumptions and Limiting Conditions and any special assumptions set forth in the Report. It is the responsibility of the user of the Report to read in full, comprehend and thus become aware of all such assumptions and limiting conditions. CBRE assumes no responsibility for any situation arising out of the user's failure to become familiar with and understand the same. 12. The Report applies to the property as a whole only, and any pro ration or division of the title into fractional interests will invalidate such conclusions, unless the Report expressly assumes such pro ration or division of interests. 13. The allocations of the total value estimate in the Report between land and improvements apply only to the existing use of the subject property. The allocations of values for each of the land and improvements are not intended to be used with any other property or appraisal and are not valid for any such use. 14. The maps, plats, sketches, graphs, photographs, and exhibits included in this Report are for illustration purposes only and shall be utilized only to assist in visualizing matters discussed in the Report. No such items shall be removed, reproduced, or used apart from the Report. 15. The Report shall not be duplicated or provided to any unintended users in whole or in part without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Exempt from this restriction is 67 CBRE Assumptions and Limiting Conditions duplication for the internal use of the intended user and its attorneys, accountants, or advisors for the sole benefit of the intended user. Also exempt from this restriction is transmission of the Report pursuant to any requirement of any court, governmental authority, or regulatory agency having jurisdiction over the intended user, provided that the Report and its contents shall not be published, in whole or in part, in any public document without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Finally, the Report shall not be made available to the public or otherwise used in any offering of the property or any security, as defined by applicable law. Any unintended user who may possess the Report is advised that it shall not rely upon the Report or its conclusions and that it should rely on its own appraisers, advisors and other consultants for any decision in connection with the subject property. CBRE shall have no liability or responsibility to any such unintended user. 68 CBRE Addenda ADDENDA © 2018 CBRE, Inc. Addenda Addendum A IMPROVED AND LAND SALE DATA SHEETS © 2018 CBRE, Inc. Addenda Sale Hotel - Full Service Hotel No. 1 Property Name Address Government Tax Agency Govt./Tax ID Improvements Status Aloft Tampa Downtown 100 West Kennedy Boulevard Tampa, FL 33602 United Slates Hillsborough A-24-29-18-4Z1-000000-00003.0 Existing Land Area 0.497 ac Gross Building Area (GBA) 79,470 sf Floor Count 8 Year Built 2014 Year Renovated N/A Construction Type Good Parking Type N/A Unique Physical Data Class # of Units Standard Room Size Affiliation Lounge Seals Restaurant Seats Upscale 130 Room N/A Stuccoed Hotels & Resorts Weddwide N/A N/A Amen Conference Facility, Convenience Store, Laundry Facility, On -Site Bar 1 Lounge , On -Site Restaurant / Dell, Pool, Public Business Center .Sete Recorded Buyer True Buyer Recorded Seller True Seller Interest Transferred Current Use Proposed Use Listing Broker Selling Broker Doc 11 Pharos CB Downtown Tampa Investors, LLC N/A Liberty Tampa investments, LLC N/A Fee Simple/Freehold Hotel Hotel N/A N/A 23677-1112 Marketing Time Buyer Type Seller Type Primary Verification 2 Month(s) Developer Developer Broker, Press Release Type Dale Sale Price Financing Cash Equivalent Capital Adjustment Adjusted Price Sale 11/13/2015 $27,243,000 Market Rate Financing $27,243,000 $0 327,243,000 Transaction Summary plus Five -Year CBRE View History Transaction Date Transaction Tyne Buyer Seller Price Cash EauivaJent Price/st 11/2015 Sale Pharos CB Downtown Liberty Tampa $27,243,000 $342.81 Tampa Investors, LLC investments, LLC CBRE © 2018 CBRE, Iric. Addenda Sate Hotel - Full Service Hotel No. 1 maiAgeonvv..., Static Analysis Method Trailing ActuaIs Buyer's Primary Analysis Price and Capita I izatbn Analyses Net Initial Yield/Cap. Rate 3.01% Actual DccupancyatSale 71% Adjusted Phoelsf t S342.81 Adjusted Price Room £209,582 Trailing Revenue Type Actu a is Period Ending NIA Source NIA Price $27,243,000 Economic Doc upancy 73% ADR (Avg Daily Rate) $145.00 Room Revenue S5,022,583 Gross Revenue S5747583 Expenses $3,555,800 Net Operating Income $2,181,883 NDI I Room $18,784 NDI Ratio 37.58 GRM (Gross Rev Mult) 4.74 RRM (Room Rev Mull) 5.42 RevPAR $105.25 Net Initial Yield/Cap. Rate 3.01% lilt Malteateet • _'s & 4,,2;;06 �y5 Google, al . r,laSC IC. A loft Tampa Downtown - this s mole -free &story 130-roam Sfa nvood Hotels & Resorts Worldwide branded full -service hotel is located at the southwest comer of West Kennedy Boulevard and North Ashley Drive with frontage on the Hillsborough River, Tampa, Florida. The property improvement was completed in Jury 2014. . The property a menities feature touch & go (reception kiosk), splash (outdoar pooD, in touch (business le center), clean (self -laundry facilities), re: charge (fitness room), backyard (outdoor patio area), re: fuel (grab 'n' go snacks 24/7), re: m a (lobby), bi 11 a rd's table, complimentary loco I s h uttle, w xyz bar and 885 square foot meeting room (tactic). The property was purchased in November 2015 for U7,243,000 or $20B,552 par guest room. CBRE © 2018 CBRE, Iric. Addenda Sale Hotel - Full Service Hotel No. 2 Property Name Address Hilton University of Florida Conference Center 1714 SW 34th Street Gainesville, FL32607 United Slates Government Tax Agency Alchua Govt./TaxID 06688-001-000 Improvements Status Existing Land Area 11.800 ac Gross Building Area (GBA) N/A Floor Count 7 Year Built 2000 Year Renovated 2016 Construction Type Goad Parking Type Open Unique Physical Data Class # of Units Standard Room Size Affiliation Lounge Seals Restaurant Seats Upscale 248 Room 351 sf Hilton 72 215 Amen Conference Facility, On -Site Bar t Lounge , On -Site Restaurant 1 Deli, Pool, Retail Kiosks Sale y7)'i Recorded Buyer True Buyer Recorded Seller True Seller Interest Transferred Current Use Proposed Use Listing Broker Selling Broker Doc# N/A Arden Group N/A Inland Leasehold Hotel Hotel Palencia Group N/A NIA Transaction Date Transaction Twin BUY E 02/2016 Sale N/A Marketing Time Buyer Type Seller Type Primary Verification 24 Month(s) REIT REIT Prior Appraisal / Party To The Transaction Type Dale Sale Price Financing Cash Equivalent Capital Adjustment Adjusted. Price Sale 2/f 1 f2016 830,000;000 Cash to Seller 836,000,000 813,500,900 $49,500,000 senor NIA Price $36,000,000 Cash Equivalent Price/sf N/A CBRE © 2018 CBRE, 8K. Addenda Sale Hotel - Full Service Hotel No. 2 AfiriSitittYltffliigril' Static Analysis Method Buyer's Primary Analysis Net Initial Yield/Cap. Rate Actual Dccu pa ncy at Sale Pro Forma (Stabilized) Static Capitalization Analysis 10.12% 79% Reve n ue Type Period Ending Source Price Economic Dec upancy AMR (Avg Daily Rate) Room Revenue Gross Revenue Expenses Net Operating Income NDI / Room NDI Ratio GRM (Gross Rev Mutt) RRM (Room Rev Mul) RevPAR Net Initial Yield/Cap. Rate MID l Comma "' /116 Pro Forma Stabilized 12I3112018 Buyer $4S,,500,000 80% $189.32 512,292,408 S 17,214,815 $12,207,188 55,007,447 $20,191 29.09 2.88 4.03 $135.79 10.12% Trailing Actua is 1 1 /3012015 Dther(See Comments) S38,000,000 79% $145.80 S10,391,182 S14,423,892 $1 0,8135,770 $3,817,922 $15,395 28.38 2.49 3.48 $114.74 10.81 % Adjusted Price sf NIA Adjusted Price Room $199,597 -411 The Hilton University of Florida Conference Center Gainesville is 24&room full -service hotel, oompleted in 2000, on an 11.8Oacre (514,007 square foot) site. The seven -story property consists ofone building. The portecoch9re leads guests tothe lobby; with the ground floor containing Albert's Restaurant, 2 Bhs Lounge, meeting space, a fitness center, a gift shop, administrative offices and back of the house operations, with rooms on the upperfloors. The hotel has 152 doubles, 93 kings, and 3 suites. Meeting space totals 19,1.11 flexible squa ra feet, with the La II room being 8,880 square feet. Additional spaces include nine meeting rooms, a board room, a prjuate dining a rea a nd pre -function space. There are 373open asphalt parking 1aP dsia 1gC01 7 Gittigle spaces. The subject hotel is located on the southwest comer of SW 34th Street and Hull Road, adjacent to the western boundary of the U n Nersity of Florida ea m pus. It is west ac ross S W 34th Street from the Ha rn M useum of Art, and south across Hull Road from the OF Orthopedics & Sports Med jcine Institute. This hotel is three mikes southwest of Downtown Ga i nesvi Ile. The entire property is subject to a ground lease from the Board of Regents of the State of Florda for and on behalf of The University of Florida th roug h April 1, 2073 at a flat rate. It was purchased fora 513,500,00O renovation and PIP in conjunction with a fra nchise extension with Hilton. Decupancyatthe time ofsake was 78.7% with an ADR of $145.80. CBRE © 2018 CBRE, 8K. Addenda Sale Hotel - Full Service Hotel No. 3 Property Name Address Embassy Su'nes Orlando Downtown 191 East Pine Street Orlando, FL 32801 United States Government Tax Agency Orange Govt./TaxID 25-22-29-8146-00-010 Improvements Status Existing Land Area 0.880 ac Gross Building Area (GBA) 138,384 sf Floor Count 7 Year Built 2000 Year Renovated 2012 Construction Type Goad Parking Type Surface Unique Physical Data Class Upscale # of Units 167 Room Standard Room Size NIA Affiliation Hilton Worldwide Lounge Seals NIA Restaurant Seats N/A Amenities Complimentary Breakfast, Conference Facility, Convenience Store, Indoor Athletic Facility, On -Site Bar! Lounge , On -Site Restaurant! Deli, Pool, Public Business Center, Surface & Structured Parking Bale Summary. Recorded Buyer Paradise America, LLC Marketing Time 6 Month(s) True Buyer Paradise Group Buyer Type Developer Recorded Seller HEI Orlando DT, LLC Seller Type REIT True Seller HEI Hotels & Resorts Primary Verification Broker Interest Transferred Fee Simple+Freehold Type Current Use Hotel Date Proposed Use Hotel Sale Price Listing Broker Michael Wienbeg, HFF Financing Selling Broker N/A Cash Equivalent Doc # 20160111658 Capital Adjustment Adjusted Price Transaction Summary plus Five -Year CBRE View History Transaction Dete Transaction Type 13lfysr Seller 03/2016 Sale Paradise America, LLC HEI Orlando DT, LLC Sale 3/3i2016 $35,350,000 Cash to Seller $35,350,000 $9,000,000 $44,350,000 Prim $35,350,000 Cash Equivalent Pdcelsf $255.45 CBRE © 2018 CBRE, 8K. Addenda Sete Hotel - Full Service Hotel No. 3 Static Analysis Method Trailing ActuaIs Adjusted P oelsf £320.43 Buyer's Primary Analysis Price and Capitalization Analyses Net Initial Yield/Cap. Rate 7.5E% Actual OccupancyatSaIe PA% Adjusted Price Room £285,583 • Revenue Type Period Ending Source Price Economic Doc upanoy ADR (Avg Daily Rate) Room Revenue Gross Revenue Expenses Net Operating Income NDI I Room NDI Ratio GRM (Gross Rev Muff) RRM (Room Rev Mull) RevPAR Net Initial Yiekl/Cap. Rate Md6 & Comments Trailing Actuals 10/31/2015 Dther(See Comments) $35,350,000 80% NIA N/A £8,537,240 £5,858,000 £2,672,240 £18,037 31.37 4.14 N/A NIA 7.5E% Embassy Suites Drlando Downtown is 7-story 187aILsu4es room full -service hotel located on East Pine StraetatSouth Rosalind Avenue, Orlando, Florida. The property improvement was completed in October 2000, and renovated in 200E. The guest rooms were renovated between August and Septem bier 2012. All rooms have a sepa rate bedroom and living room area. The hotel amenities include an outdoor pool, fitness room, business center, complimentary breakfast, Eola Cafa restaurant se ruing breakfast, lunch &dinner, a complimentary manager's evening reception and fifteen meeting rooms with 10,244 sguarefeetof meeting space. This property was purchased by Korean investment firm in March 20113 for £35,350,000which equates to £265,513S per guest room. The hotel was purchased with the buyer planning to spend an estimated £5.Om in renovations. CBRE © 2018 CBRE, Inc. Addenda Sale Hotel - Full Service Hotel No. 4 Property Name Address Government Tax Agency Govt./Tax ID Improvements Status Westin Tampa Harbour Island 725 South Harbour Island Boulevard Tampa, FL 33602 United Slates Hillsborough A-24-29-18-ZZZ-000005-94130.0 Existing Land Area 1.479 ac Gross Building Area (GBA) 245,508 sf Floor Count 12 Year Built 1985 Year Renovated 2008 Construction Type Goad Parking Type Subterranean Structure Unique Physical Data Class # of Units Standard Room Size Affiliation Lounge Seats Restaurant Seats Upscale 299 Room 0si Starwood Hotels & Resorts 0 0 Amenitr Concierge, Conference Facility, On -Site Bar/ Lounge, On -Site Restaurant / Deli, Pool, Public Business Center, Structured Parking Sale Summary Recorded Buyer True Buyer Recorded Seller True Seller Interest Transferred Current Use Proposed Use Listing Broker Selling Broker Doc# Tampa HI Owner VIII, LLC Walton Street Capital; LLC Harbour Island Owner, LLC Blackstone Group, LP Fee Simple/Freehold Hotel Hotel Preston Reid, HFF N/A 24376-616 Marketing Time Buyer Type Seller Type Primary Verification 9 Month(s) Developer REIT Broker Type Date Sale Price Financing Cash Equivalent Capital Adjustment Adjusted Price Sale 9,/712016 $55,000,000 Market Rale Financing $55,000,000 $9,000,000 $64,000,000 Transaction Date Transaction Tvoe Buyet Seller 09/2016 Sale Tampa HI Owner VIII, LLC Harbour Island Owner, LLC Price Cash Eauivalent Pricelst $55,000,000 $224.03 CBRE © 2018 CBRE, 8K. Addenda Sole Hotel - Full Service Hotel No. 4 Static Analysis Method N/A Buyer's Primary Analysis NIA Net Initial Yield/Ca p. Rate NIA Actual DccupancyatSale 75% Revenue Type Period Ending Source Price Economic Occupancy ADR (Avg Daily Rate) Room Revenue Gross Revenue Expenses Net Operating Income NOI J Room NOI Ratio GRIM (Gross Rev MuIt) RRM (Room Rev Mull) RevPAR Net Initial YieldJCap. Rate Mlltr4s ik C.vdreeri Tampa Trailing Actuals N/A N/A $55,000,000 75% $150.00 $13,098,200 $17,048,200 $12,995,000 $4,051,200 $13,549 23.77 3.23 4.20 $120.00 7.37% .•::ate eID17 Gouge Adjusted Pnoe/sf $260.88 Adjusted Price J Room $214,047 Westin Tampa Harbour Island - this smoke -free 12-story 299-room fu II service hotel is located on the west side of Harbour Island Boulevard, Tampa, Florida. The property improvement was ccmpirated in June 19&5 and operated as a Wyndham. In April 2008 after u pg ra des and renovations the property was re -flagged to Starwood Hotels & Resorts branded Westin. The property amenities featu re an outdoor pool, fhness room, business center, sundry shop. Ala mo ca r renta l desk and has eleven meeting naom s with 14,900 square feet of meeting space. The property was purchased in September 2018 for$55,000,000 or $1&3,948 per guest room. The property will be under -going a $9,000,000 brand PIP over the next two years. CBRE © 2018 CBRE, IrK. Addenda Sale Land - Hotel/Motel No. 1 Property Name Address County Govt./Tax ID Land Area Net Land Area Gross Site Development Status Utilities Maximum FAR Min Land Bldg Ratio Shape Topography Flood Zone Class Flood Panel No / Date Zoning Entitlement Status Transaction Derails Type Interest Transfered Condition of Sale Recorded Buyer Buyer Type Recorded Seller Marketing Time Listing Broker Doc If Baywood Hotels 250 SW 7th Street Miami, FL 33130 Miami -Dade 01-0205-010-1080 & 1100 1.030 act 44,865 sf 1.030 ac144,865 sf Finished Available to site 7.00 0,14:1 Rectangular Level, Al Street Grade N/A N/A T6-24 0, Urban Core N/A Sale Fee Simple "Arm's length" Marathon Lodging, LLC End User Walgreen Co. N/A N/A 29567f3382 Primary Verification Transaction Date Recording Date Sale Price Financing Cash Equivalent Capital Adjustment Adjusted Price Adjusted Price 1 ac and ! sf Adjusted Price/ FAR Adjusted Pric& Unit Lessner This comparable land sale was assembled by Walgreens in February 2014 for $10,113,750 plus demolition costs for an obsolete car wash and vintage rental apartments. However, Walgreens changed direction on the site and decided to sell -out of it. The buyer is hotel developer & operator based in Rockville Maryland with Homesuites, Holiday Inn, Staybridge, Marriott, Hampton Inn and Fairfield Inn & Suites brands. In addition. the company recently acquired Hotel Urban° located at 2500 Brickell Avenue, and recently announced a partnership with Accor Hotels of France 10 build an Ibis Hotel. The proposed conceptual plan will be a mixed -use tower with 48-stories including 400 hotel rooms, 8-story parking garage, residential units, office space and ground level retail. The property location is catty -corner to Publix, across the street from the the proposed 1,500 unit Riverwalk residential community and the SW 3rd Avenue frontage leads directly to the Interstate 95 north bound on -ramp. This sale transaction was facilitated with a $7,500,000 (50% LT-V) conventional acquisition loan in favor of Floridian Bank, Based on "as -of -right" zoning the development potential is 314,055-SF of gross building area, 200 residential units or 400 hotel rooms. CBRE Bill , Buyer 04,102/2015 N/A $15,500,000 Cash to Seller $15,500,000 $0 $15,500,000 $15,048,6441$345-48 $49.35 $37,621 © 2018 CBRE, 00. Addenda Sale Land - Hotel/Motel No. 2 Property Name Address Site for Proposed Best Western Vib 1265 SW 22nd Street 33145 Miami, FL 33145 County Miami -Dade Gcvt./LaxID N/A Land Area. Net 0.824 aol 35,894 sit Land Area Gross N/A/ N/A Site Development Status Semi -Finished Utilities All Available to Site Maximum FAR N/A Min Land Bldg Ratio N/A Shape irregular Topography Generally Level Flood Zone Class Zone X (Shaded) Flood Panel No./ Date 12086C-02861J Sep 2009 Zoning C-1 Entitlement Status N/A Type Sale InterestTransfered Fes Simple Condition of Sale None Recorded Buyer IVE Group Ore, LC Buyer Type N/A Recorded Seller Delia Hospitality, LLC Marketing Time N/A Listing Broker None Doc # 29720/0392 Primary Verification Buyer and Warranty Deed Transaction Date 07/23/2015 Recording Date 07/23/2015 Sale Price $4,509,009 Financing Cash to Seller Cash Equivalent $4,509,009 Capital Adjustment $0 Adjusted Price $4,509,000 Adjusted Price 1 ac and / sf $5,461,165 / $125.37 Adjusted Price/ FAR NIA Adjusted Price/ Unit $31,250 This sale occurred in July of 2015 and will be developed with a 144-unit Best Western Vib hotel that is scheduled to be complete by 7/1/17. The property is located on Coral Drive and also has frontage along SW 21 st street. CBRE © 2018 CBRE, Iric. Addenda Sale Land - Mixed -Use No. 3 Property Name Address Associated Photo 19 SW 61h Street 42 SW 61h Street Miami, FL 33130 County Miami -Dade Govt./Tax ID 01-0200-010-1040; -1070; 01-0225-030-1040 Land Area. Net 0.364 eel 15,863 sf Land Area Gross NIA/ NIA Site Development Status Finished Utilities All available Maximum FAR 11.00 Min Land Bldg Ratio 0.09:1 Shape Other(See Comments) Topography Level, Al Street Grade Flood Zone Class Zone AE Flood Panel No.! Date 12086C0314LJ Sep 2009 Zoning T6-48b 0, Urban Core Entitlement Status N/A Transaction Details Type Sale InterestTransfered Fee Simple Condition of Sale "Arm's Length" Recorded Buyer 2 Indian Creek Holdings,LLC Buyer Type Developer Recorded Seller Associated Photo and Imaging, Inc. Marketing Time N/A Listing Broker N/A Doc d 29758/1356 Adjusted Price/ FAR Adjusted Price/ Unit Primary Verification Transaction Date Recording Date Sale Price Financing Cash Equivalent Capital Adjustment Adjusted Price Buyer 08/14/2015 N/A $8,820,000 Cash to Seller $8,822,000 $0 $8,820,000 Adjusted Price / ac and 1 sf $24,217,4631$556.01 $50.55 $48,462 This comparable is the sale of two noncontiguous properties in the Brickell submarket situated at 19 and 42 SW 6th Street, Miami, FL. The properties face each other on the north and south sides of SW 6th Street immediately west of South Miami Avenue. They are also on the north side of the mixed - use Brickell City Centre project. Bath lots are improved with obsolete office structures that are still occupied after the safe by the seller, Associated Photo, on an interim basis although specific lease terms, were not disclosed. The north half of the property consists of 2 folios and 10,649-SF of land while the south half is one folio and 5,214-SF of land. The small sizes of the lots and their irregular shapes make development to the maximum density and height allowed per zoning a challenge. The buyer, Mr. Carlos Mottos, is a high net worth speculator0investor who also owns the farmer Tobacco Road site that is also on the north side of Brickell City Centre. CBRE © 2018 CBRE, 8K. Addenda Sale Land - Mixed -Use No. 4 Property Name Address County Govt./Tax ID S&S Diner Site 1753 - 1775 NE 2nd Avenue Miami, FL 33132 Miami -Dade 01-3231-003-1000, 6950, 0360, 0970, 0980, 0990, 1010 & 1020 Land Area Net 1.386 ad 60,375 el Land Area Gross 1.386 ad 60,375 sf Site Development Status Finished Utirities In -place Maximum FAR 2240 Min Land Bldg Ratio 0.04:1 Shape Rectangular Topography Leval, At Street Grade Flood Zone Class N/A Flood Panel No .f Dale N/A Zoning T6-24 0, Urban Core TrersectZone Entitlement Status N/A Type Interest Transfered Condition of Sale Recorded Buyer Buyer Type Recorded Seller Marketing Time Listing Broker Doc # Sale Fee Simple "Arm's Length" ASRR 18, LLC International Buyer 17th & Second Avenue Properties Corp. N/A "Off market" transaction Primary Verification Transaction Date Recording Date N/A Sale Price $33,000,000 Financing All Cash Cash Equivalent $33,003,000 Capital Adjustment $0 Adjusted Price $33.030.000 Jennifer Cohen, Esg„ Public Records & Media 05/31/2017 30560/33 Adjusted Price 1 ac and 1 sf S23,809,5241 S546.58 Adjusted Price/ FAR $24.40 Adjusted Price/ Unit $47,619 Comments This cornpol able land sale comprises a multiple parcel assemblage by the sellers in 2012 & 2015 for a total of $3,805,000, including a deed in lieu of foreclosure. The site was previously concept planned for Urbana Towers dating back to 2005, and cancelled in the wake of the great recession_ The sellers, identified as 17th & Second Avenue Properties Corp, is controlled by Uruguayan investors who won an eviction order against S&S Diner that was located at 1753 Northeast 2nd Avenue since 1938. The buying entity contracted the site in February, 2017, and comprises a partnership between three (3) publicly traded companies, including ASRR Capital, a Tel Aviv Stock Exchange company; G-Resources Group, a Hong Kong Stock Exchange company; and, China National Building Material Co., Hong Kong Stock Exchange company. Each entity will own 33% or the project, while ASRR will also earn a 3% developer fee for managing the project The site was improved with a 6,981-SF commercial building and a I2,698-SF office building both built in 1937 and partially occupied by S&S Diner prior to eviction, an obsolete church and surface parking lots that areall being demolished by the buyerfdeveloper who is proposing a two mixed -use towers including residential apartments. retail office and hotel rooms_ The site zoning permits 24-stories, "as of right" plus a benefit of 24-stories and a 16-0 FLR plus 40% benefit for a total of 22.4 FLR, subject to City of Miami site plan approval and entitlement process. CBRE © 2018 CBRE, Iric. Addenda Addendum B SMITH TRAVEL RESEARCH REPORT 0 2018 CBRE, Inc. Trend # 964713_SADI M !Created March 16, 2018 Trend Report - Miami Beach, FL Area Selected Properties January 2012 to January 2018 Currency USD - US Dollar Table of Contents 1 Data by Measure 2 Percent Change by Measure 3 Percent Change by Year 4 Twelve Month Moving Average 5 Twelve Month Moving Average with Percent Change 6 Day of Week Analysis 7 Raw Data 8 Classic 9 Response Report 10 Terms and Conditions 11 Help 12 735 East Main Street. Hendersonville. TN 37075 T' +1 615 824 8664 trends0str.com www.str.com Blue Fin Building. 110 Southwark Street. London SE1 OTA 1'' +44 (0)20 7922 1930 hoteltrendsi 1etr.com www.str.com The STR Trend Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solelyfor use by paid subscribers. Reproduction or distribution of the STR Trend Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR Trend report, please contact us immediately. Source: 2018 STR, Inc. f STR Global, Ltd. trading as "STR". Tab 2 - Data by Measure Miami Beach, FL Area Selected Properties Job Number: 964713 SAOIM Staff: SS Created: March 16, 2018 Occu rant %• January February March April 2012 84.4 86.9 80.9 87.3 2013 82.8 88.6 91.5 79.9 2014 83.4 88.8 90.1 87.2 2015 84,7 89.8 88.8 89.2 2010 83.9 06.4 09A 68.5 2017 76,2 86.7 87.4 86.9 2018 85,7 Avg 82.9 87.8 89.2 66.5 May June July August September October November December Total Year Jan YTD 83.9 86.2 87.5 83.1 77.2 79.4 79.9 76.2 83.4 64.4 79.1 80.6 81.8 79.8 69.7 72.0 75.0 82.8 80.3 82.8 85.7 02.7 81.2 05.2 71.2 77.7 79.6 86.1 83.2 03.4 66.7 60.5 87.6 80.8 71.6 73 3 78.1 79.4 82.5 84.7 85.0 78.4 65.5 74.2 68.3 64.0 75.3 77.5 77.9 83.9 81.3 82.6 86.2 82.2 42.4 68.3 75.3 77.5 77.9 76.2 85,7 83.6 81.8 81.6 80.9 66.6 72.5 77.3 80.0 80.9 82.9 January February Mardi April May June July August September October November December Total Year Jan YTD 2012 257.45 288.12 280.06 247.20 202.36 176.61 177.79 165.28 162.26 214.95 203.76 271.23 220.74 257.45 2013 291.98 307.29 321.37 244.06 208.44 190.49 185.44 176.86 169.60 202.02 212.67 279.68 235.14 291.98 2014 292.53 318.74 315.61 273.84 222.71 189.17 195.93 190.48 173.13 213.62 224.91 299.05 244.39 292.53 2015 304.49 339.03 319.59 27548 223.53 189.52 194.25 177.91 169.89 212.84 228.32 295.74 246.14 304.49 2016 290.35 311.74 312.76 248.36 221.49 183.45 172.63 147.46 150,03 177.78 195.53 249.46 226.25 290.35 2617 268.75 294.63 283.62 248.19 212.75 186.89 203.88 179.49 187.21 216.48 236.58 334.07 238.63 268.75 2018 304.12 _ 304.12 Avg 237.10 310.26 305.70 256.54 215.47 185.97 189.03 173.40 167.41 206.56 216.57 287.31 235,33 287.10 January February March April May June July August September October November December Total Year Jan YTD 2012 217,37 250.27 248.39 215.71 169.56 152.31 155.49 137.34 125.21 170.52 152.77 206.70 184,04 217.37 2013 241.61 271.87 294.09 195.02 164.79 153.48 151.66 141.06 118.15 145.49 159.57 231.67 188.73 241,81 2014 244.01 282.95 284.49 238.83 190.88 156,35 159.14 162.33 123.23 166.05 179,07 257.57 203.44 244.01 2015 257.76 304.56 283.69 245.68 193.77 152.51 170.13 143.58 121.71 156.08 178.31 234.89 203.07 257.76 2016 243.62 269.37 276.63 219.78 188.17 143.86 113.14 109.39 102.52 113.84 147.33 193.37 176.25 243.62 2017 204.68 255.35 247.91 215.59 172.87 154.43 175.78 14748 79A6 147.95 179.25 258.79 186.00 204.68 2016 260.54 260.54 Avg 238.10 272.52 272.60 221.98 160.17 152.14 154.21 140.20 111.52 149.89 16747 229.65 19032 238,10 January February March April May June July August September October November December Total Year Jan YID 2012 64,790 58520 64,790 62,610 64.697 62,610 64,697 64,697 62,610 64,697 62,610 64635 761,963 64,790 2013 64,635 58,380 64,635 62,550 64,635 62,550 64,635 64,635 62,550 64,635 62,559 64,635 761,025 64.635 2014 67,518 60,984 67,518 65,340 67,518 65,400 67,580 67,332 65,169 07,332 65.163 67,332 794.174 67,518 2015 67332 60.816 67,332 65,160 67,332 65,160 67.332 67332 65,160 67,332 65,160 67,859 793,307 67,332 2016 67,859 61,292 67,659 65,670 87,659 65,670 67,659 67,859 65,670 67,659 65,670 67,859 798,985 67.859 2017 67,559 61,292 67,659 65,670 67,659 65,670 67.359 67.859 65,670 56,823 54.990 56,823 766,233 67,859 2016 56,823 56,823 Avg 65,259 60,214 66,666 64,560 66,650 64,510 66,569 66.619 64,470 64.760 62,699 64,857 779,2131 65,259 January February March April May June July August September October November December Total Year Jan YTD 2012 54.702 50,834 57,578 54,633 54,273 53,994 56,581 53,761 48.313 51.346 50,015 49,256 635.286 54,702 2013 53,529 51,650 59,148 49,981 51,098 50,398 52,361 51,552 43,573 46.548 46,933 53,540 610,811 53,529 2014 56,320 54,137 60,861 56,986 57,667 54,054 54388 67,362 46,377 52,338 51,860 57,997 661,087 56,320 2015 57.000 54,634 59,767 50,112 50,368 52.437 58,971 54.375 46,600 49.377 50,880 53,097 654,506 57,000 2016 56,937 52,962 60,020 58,113 57,650 51,496 44,475 50,342 44,874 43,452 49,481 52,603 622,405 56,937 2017 51,681 53.122 59,314 57,043 55,140 64,265 58.506 55,757 27,872 38,836 41,664 44,019 597,219 51,681 2018 48.680 48,680 Avg 54,121 52,890 59,448 55,811 55,733 52,774 54,380 63,862 42,948 46,983 48,477 51,885 530,219 54,121 January February March April May June July August September October November December Total Year Jan YTD 2012 14,083,260 14,646,084 16,125,375 13,505327 10,966,376 9.536,141 10,059,707 8,885,808 7,839,4,53 11,031,834 10,190,958 13,359,790 140,230,113 14,083,260 2013 15 629,337 15,871,525 19,008,535 12,198.312 10,650 963 9,600,101 9,802.659 9,117,667 7,390,143 9,403,855 9,981,184 54,974186 143,628,467 15,629,337 2014 16,475,314 17,255,691 19,208,257 15,604,902 12,807,829 10,225,336 10.754,471 10.930,174 8,029,413 11,180,273 11,668,196 17,343,011 161,562,867 16,475,314 2015 17,355,703 18,522,384 19,101,133 16,008,639 13,046,979 9,937,603 11,455,197 9,673,940 7,930,468 10,569,355 11.618,699 15,939.230 161,099,330 17,355,703 2010 16,531539 16510,426 18,771,732 14.432923 12,768,867 9,447,050 7,677,760 7,423,278 6,732,563 7,725,110 9675,242 13,122,092 140,818,582 16,531,539 2017 13,889,234 15,651,148 16,822.840 14,157,753 11.730,793 10,141,372 11.928,146 10.007,858 5,217,919 8,407,055 9,856,973 14,705.352 142,516,442 13,889,234 2010 14,804,406 14,804,406 Avg 15,538,399 16409,543 18,172,979 14.317,976 12.1308.635 9,814901 10,279,657 9,339,788- 7,a89:993 9,709,580 10,498,542 14.907217 148,309.303 15.538,399 Tl,e STR Trent Repot -Iv a Wog cal on or STR, Inc ant SIR Gin eSl, lid and le Iraeldeit soleh'Tar dealt.' oaldsuuscrbers Reprzldnctlon drdletlbinlon Mine SFR Trend Renee, In whole groan, *VOA WMen peml,anion Is pruflbl Cell and skla]b0C to leg/elector, ITy01 neve YerelvedM a report and are NOT a subsieO Nlo lne STR Trend ri,porg please contact its Immetl0BlelV- Source; 2g1 N STR, Inc i 5TR Global, Ltdtrading as "STIR'. Tab 3 - Percent Change from Previous Year - Detail by Measure Mlarnl Beach, FL Area Selected Properlies Job Number: 964713 SADIM Staff: S5 Created: March 16. 2016 January February March 2013 -1.9 1.8 3.0 2014 0.7 0.3 -1.5 2015 1.5 1.2 -1.6 2016 -0.9 -3.8 -0.4 2017 -9.2 0.3 -1.2 2018 12.5 Avg 0.4 -0.0 -0.3. April May June July August September October November December Total Year Jan YTD -8A -5.8 -6.6 -6.5 -4.0 -9.7 -9.3 -6.1 3.7 -3.7 -1.9 9.1 8,4 2,6 -0.7 6,9 2.2 7,9 6,1 4.0 3.7 0.7 2.3 1.1 -2.6- 7.8 -6,2 0,7 -67 -1,9 -7.8 -0.9 1.6 -0.8 -2.0 -2,6 -26.2 -8.1 -4.6 -12.7 -3,6 -2.4 -5.6 -0.9 -1.8 -4.4 5.4 31.5 10,8 -37,9 6.7 0,6 -0.1 0.1 -9.2 12.5 0.1 -0.5 -0.8 1.4 0.0 -9.9 -2.6 -1.0 0.5 -1.3 0.4 January February March April May June July August September October November December Total Year Jan YTD 2613 13.4 6.7 14.8 -1.3 3.2 7.9 4.3 7.0 4.5 -6.0 4 4 3.1 6.5 13,4 2014 0.2 3.7 -1.8 12.2 6.8 -0,7 5.7 7.7 2.1 5.7 5,8 6.9 3.9 0.2 2015 4.1 6.4 1.3 0.6 0.4 0.2 -0.9 -6.6 -1.9 -0.4 1.6 -1.1 0.7 4.1 2016 -4.6 -8.0 -2.1 -9.8 -0.9 -3,2 -11.1 -17.1 -11.7 -16.5 -14 4 -15.6 -8.1 -4.6 2017 -7A -5.5 -9.1 -0.1 -3.9 1,9 18.1 21.7 24.8 21,8 21,0 33.9 5.5 -7.4 2018 13.2 13.2 Avg 3.1 0.6 0.6 0.3 1.1 1,2 3.2 2.5 3.6 0.9 37 5.4 1.7 3.1 January February March April May June July August September October November December Total Year Jan YTD 2613 11.2 8.6 18.2 -9.6 -2.8 0,8 -2.5 2.7 -5.6 -14.7 -2,0 12.1 2.5 11.2 2014 0.9 4.1 -3,3 22.5 15,8 1,9 4.9 15.1 4.3 14.1 12.2 11.2 7.6 0.9 2615 5,6 7.6 -03 2.9 15 -2,5 6.9 -11,5 -12 -6.0 -04 -68 -0,2 56 2016 -5.5 -11.6 -2,5 -10.5 -2.9 -5,7 -33.5 -23,9 -15.8 -27.1 -17.4 -17.7 -13.2 -5.5 2017 -16.0 -5.2 -10.4 -1.9 -8.1 7.3 55.4 34.8 -22.5 30,0 21.7 33.8 5.5 -16.0 2018 27.3 27 3 Avg 3.9 0.7 0.3 0.7 0.7 0A 6.2 3.4 -8.2 -0.7 2.8 6.1 0.5 3.9 EPTTlx January February 2013 -0.2 -0.2 2014 4.5 4.5 2015 -0.3 -0.3 2016 0.0 0.6 2017 0.0 0.0 2018 -16.3 Avg -1.9 0.9 March 45 -0.3 0,8 0.0 0.9 April May June July August September October November December Total Year Jan YTD -0.1 -0.1 -0.1 -0.1 -0,1 -0.1 -0.1 -0.1 0.0 -0.1 -0.2 4.5 4,5 4.6 4.6 4.2 4,2 4.2 4,2 4.2 4.4 4.5 -0.3 -0.3 -0.4 -0.4 0.0 0.0 0.0 0.0 0.8 -0.1 -0.3 0.0 0.8 0,0 0.0 0.8 0.8 0.8 0.8 0.0 0.7 0.0 0.0 0,0 0.0 0,0 0.0 0.0 -16.3 -16.3 -16.3 -4.1 0.0 -16.3 1.0 1.0 1,0 1.0 1,0 1.0 -2.3 -2.3 -2.3 0.1 -1.9 Demand 2013 2014 2015 2616 2017 2018 Avg January -2.1 5.2 1.2 -0.1 -9.2 -5.8 -1.8 February 1.6 4.8 0.9 -3.1 0.3 March 2.7 2,9 -1.8 0.4 -1.2 0.9 0.6 April -8.5 14.0 2.0 0.0 -1.8 May -5.9 13.2 0.9 -1.2 1.1 0.5 June -6.7 7.3 -3.0 -1.8 6.4 July -6.6 3.8 7.4 -24.6 31.5 August 4.1 11.3 -7.4 10.6 September -9.8 6.4 0.7 -3.9 -37.9 0,2 2.3 1.1 -8.9 October -9.3 12.4 -6.7 -12.0 -10.6 November -6,2 10.5 -1.9 -2.8 -15.8 -5.0 -3.2 December 8.7 6.3 -7.1 -2.4 -16.3 Total Year -3.9 8.2 -1.0 -4.9 -4.0 -1.8 -1.1 Jan YTD -2.1 5.2 1.2 -0.1 -9.2 -5.8 -1.8 January February March April May June July August September October November December Total Year Jan YTD 2013 11.0 8.4 17.9 -9.7 -2.9 0,7 -2.6 2,6 -5.7 -14.8 -2.1 12.1 2A 11.0 2014 5.4 6.7 1.1 27.9 21,0 6.5 9.7 19,9 8.7 18,9 16.9 15.6 12.6 5.4 2015 5.3 7.3 -0.6 2.6 1.2 -2,8 6.5 -11,5 -1.2 -6.0 -0A -6.1 -0.3 5.3 2016 -4.7 -10.9 -1.7 -9.8 -2.1 -4,9 -33.0 -23,3 -15.1 -26,5 -16.7 -17.7 -12.6 -4.7 2617 -16.0 -5.2 -10.4 -1.9 -6.1 7,3 55.4 34.8 -22.5 6.8 1.9 12.1 1.2 -16.0 2618 6.6 66 Avg 1.3 1.7 1.3 1.8 1.8 1,4 7.2 4,5 -7.2 -3.9 -0,1 2.8 0.6 1.3 Tab 4 - Percent Change from Previous Year - Detail by Year Miami Beach, FL Area Selected Properties Soh Number 964713_510IM Staff SS Created_ March 16, 2018 Jan 13 Feb13 Mar 13 A•r13 Ma 13 Jun13 Ju113 Au.13 Se. 13 Oct13 Nov13 Dec13 Occ ADR RevPAR Supply Demand Revenue -1 9 13.4 11.2 - 0.2 -2.1 11.0 1.8 6.7 8.6 -0.2 16 8.4 3.0 14.8 18.2 -0.2 2,7 17.9 - 8.4 -1.3 -9.6 -0.1 - 6 5 -9.7 - 5.8 3.2 -2.8 - 0.1 -5 9 -2.9 - 6 6 7.9 0.8 - 0.1 - fi 7 0.7 -6 5 4.3 -2.5 -0.1 -6 A -2.6 -4.0 7.0 2.7 -0.1 -4,1 2.6 -9 7 4.5 -5.6 - 0.1 -9 9 -5.7 -9.3 -6.0 -14.7 -0.1 -9.3 -14.8 -6 1 4.4 -2.0 - 0.1 -6 2 -2.1 8.7 3.1 12.1 0.0 8,7 12.1 Jan 14 Feb14 Mar14 A•r14 Ma 14 Jun14 Jul 14 Au. 14 Se. 14 Oct 14 NOv14 Dec14 Occ ADR RevPAR Supply Demand Revenue 0.7 0.2 0.9 4.5 5.2 54 0.3 3.7 4.1 4.5 4.6 87 -1.5 -1.8 -3.3 4.5 2.9 1.1 9.1 12.2 22.5 4.5 14.0 27 9 8.4 6.8 15.8 4.5 13.2 21.0 2.6 - 0.7 1.9 4.6 7.3 65 -0.7 5.7 4.9 4.6 3.8 97 6.9 7,7 15.1 4,2 11.3 199 2.2 2.1 4.3 4.2 6.4 8.7 7.9 5.7 14.1 4.2 12.4 18.9 6.1 5.8 12.2 4.2 10.5 169 4.0 6.9 11.2 4.2 8.3 159 Jan 15 Feb 15 Mar15 A.r 15 Ma 15 Jun 15 Jul 15 Au. 15 Se 15 Oct 15 Nov 15 Dec 15 Occ ADR RevPAR Supply Demand Revenue 1.5 4.1 5.6 -0.3 1.2 5.3 1.2 6.4 7.6 -0 3 0.9 7.3 -1.5 1.3 -0.3 -0.3 -0.6 2.3 0.6 2.9 - 0.3 2.0 2.6 1.1 OA 1.5 -0.3 0.9 1.2 -2.6 0.2 - 2,5 -0 4 -3.0 -2.8 7.8 -0.9 69 -0 4 7A 6.5 -5.2 -6.6 -11.5 0.0 -5.2 -11.5 0.7 -1.9 - 1.2 0.0 0.7 -1.2 -5.7 -0.4 -6.0 09 -5.7 -6.0 -1.9 5 - 0.4 00 -1.9 -0.4 -7.8 -1.1 -8.8 0.8 -7.1 -8.1 Jan16 Feb16 Mar16 A•r16 Ma 16 Jun16 Ju116 Au. 16 Se. 16 Oct16 Nov16 Dec16 Occ ADR RevPAR Supply Demand Revenue - 0.9 -4.6 -5.5 0.8 - 0.1 -4.7 -3.8 -8 0 -11.6 0.8 -3.1 -10.9 -0.4 -2.1 -2.5 0.6 0.4 -1.7 - 0.8 -9.8 -10.5 0.8 0.0 -9.0 - 2.0 -0.9 -2.9 0.8 - 1.2 -2.1 - 2.6 -3.2 -5.7 0.8 -1.8 -4.9 -25.2 -11,1 -33.5 0.8 -24-6 -33.0 - 8.1 -171 -23.9 0.8 - 7.4 -23.3 - 4.6 -11 7 -15.8 0.8 - 3.9 -15.1 -12.7 -16.5 -27.1 0.8 -12.0 -26.5 - 3.5 -14 4 -17.4 0.8 - 2.8 -16.7 - 2.4 -15.6 -17.7 0.0 - 2.4 -17.7 IIMEZEZIO -3.7 -19 6.5 13.4 2.5 11.2 - 0.1 -0.2 -3.9 -2.1 2.4 11.0 MEEREIMO 3.7 0.7 3.9 0.2 7.0 4.4 8.2 12.5 0.9 4.5 5.2 54 -0.9 1.5 0.7 4.1 -0.2 -01 -1.0 -0.3 5.6 -0.3 1.2 5.3 - 5.6 -0.9 -8.1 -4.6 -13.2 -5.5 0.7 0.8 - 4.9 -0.1 -12.6 -4.7 Jan 47 Feb 17 Mar 17 A. r 17 Ma 17 Jun 17 Jul 17 Au. 17 Se. 17 Oct 17 Nov 17 Dec 17 Occ AMR RevPAR Supply Demand Revenue -9.2 -7.4 -16.0 0.0 -9.2 -16.0 0.3 0.0 0.3 -5.2 -1.2 -9.3 -10A 0.0 -1.2 -10.4 -1.8 -0.1 -1.9 0.0 -1.8 - 1.9 -.4 -3.9 -8.1 0.0 -.4 - 8.1 5.4 19 73 0.0 6.4 7.3 31.5 18,1 55.4 0.0 31.5 55.4 10.8 21.7 34.8 0,0 10.8 34.8 -37.9 24.8 -22.5 0.6 -37.9 -22.5 6.7 21.8 30.9 -16.3 -10.6 8.8 0.6 21.0 217 -16.3 -15.8 1.9 -0.1 33.9 33.6 -16.3 -16.3 12.1 MEEMEEEENna 0.1 -9.2 5.5 -7.4 5.5 -4.1 -4.0 1.2 -160 0.0 -9.2 -16.0 Jan 18 Feb 18 Mar 18 A . r 18 Ma 18 dun 18 Jul 16 Au, 18 Se. 18 Oc1 18 Nov 18 Dec 18 Oct ADR RevpAR Supply Demand Revenue 12.5 13.2 27.3 -16.3 -5.8 6.6 12.5 13.2 27-3 -16.3 -5.8 6.6 The STR Trend Report, a puhl eaeon of STR Inc. and. STR Global, Lttl. , and Is intended sdley tilt ,lee by paid sbbstntt;S. ReprudUcboh br distnbuoan of the STR Trend Report, id d!hole Dr part , tithoUt omen pehnisSibh Id prnhihiled and 5abjldt It legal act ah. Ifyou have received this report and are MOT a sUbsoliber be the STR Tana report, please contact us immediately Source2010 STR, ]nc. l STR C; lade!, Lta. haalr4 2e'STR- Tab 5 -Twelve Month Moving Average MIen11 Beech, FL Area Selected Properties Job Number. 964713 SADIM Staf.. SS Created: March 16, 2018 s January February March April 2013 63.2 83.4 83.6 83.0 2014 603 804 603 809 2015 83.3 83.4 83.3 83.5 2016 82.4 82.2 82.2 82,1 2017 77.2 77.3 77.2 77.0 2018 78.7 May 82.6 815 83.6 82.0 76.7I June 82.1 817 83.4 131.8 77.1 Jury 81.6 81.6 83.9) 79.9 78.8 August September October November December 81.3 80.7 80.1 79.7 80.3 82-1 822 826 830 832 83.5 83.6 83.2 83.1 82.5 794 79.1 78.3 73.1 77.9 79.5 77.4 77.9 77.9 77.9 January February March April 2013 223,58 225.22 229,20 228.62 2014 235 45 236.75 236 42 239 22 2015 245.47 247.20 247.44 247.63 2016 244.90 242.45 241.35 239.44 2017 223.89 222.44 219,54 219.47 2018 24138 May 229.47 24020 247.59 239.27 218,88 1 June 230.139 239.60 247.86 I 238.37 216.62 July August September October November December 231.86 233.06 234.13 233.30 234,14 235.14 24053 241.17 24111 241.69 242.44 244,39 247.39 246.62 246.35 246.44 246.74 246.14 238.37 236.33 235,11 232.89 230,30 226.25 220.70 222.88 226.56 229.38 232.64 238.53 January February March April 2013 166,10 1137.75 191,57 169.137 2014 189..13 190.29 189.84 193.56 2015 204.59 206.23 206.14 206,70 2016 201.90 199,25 198,70 196.59 2017 172,94 171,86 169,43 169.06 2016 189.93 May 189.47 195.73 206,95 196.11 167.78 I June 169.57 195.81 206,65 195.37 163.65 July 169,25 196.29 207,501 190.50 173,97 August September 169.57 189,99 197.93 198.09 206.01 205.99 187,55 185,93 177,21 175,31 October November December 1136.67 186.61 163.73 199.66 201.14 203.44 205.04 204 98 203,07 182.32 179.77 176.25 176.63 1131.32 186.00 2013 2014 2015 2016 2017 20181 January February March April May June 761,808 761,668 761,513 761,453 751,391 761,331 763,906 766612 769,395 772165 775,068 777,916 793,988 793820 793,634 793,454 793.268 793,028 793.834 794.310 794,337 795,347 795,374 796,334 798,985 798,985 798,985 798,985 798,965 798,965 755,197 1 Jury 761.269 760,363 792,780 796,911 798,985 August 761,207 783,560 792,78a 797,438 798,985 September 761,147 786,170 792,780 797.948 798,985 October 761,085 733367 792,780 798,475 787,949 November 761,025 791,477 792,780 796.9351 777,264 December 761,025 794J74 793,307 798,935 766,233 January February March April May June 2013 634,113 634,929 636,499 6311347 628,672 625,376 2014 613,602 616.069 617.602 624.607 637.57fi 835,232 3015 561,767 662,364 661,170 662,296 662,797 661,180 2016 654,443 652,771 653.024 653,025 652,307 651,366 2017 617,149 617,309 616,603 615,533 613,023 615,792 20181 594,2t81 July 621,356 637,259 665,2631 636,870 629,823 August September October November December 619,147 614407 609,609 606,527 610.811 643,889 345393 651.663 856,630 661067 662,256 662,559 659,596 658,696 654,506 632.837 631,031 625.106 623,699 622405 635,236 618,236 613,620 605,803 597,219 LEMEW January February March April 2013 141,776,1913 143,301,631 145,004,791 144,577,776 2014 144474,444 145,658,610 146, 058, 332 149,464, 922. 2015 162.443256 163,709,949 163.602.625 164,006,562 2016 160,275 ,166 158,263,208 157.933, 307 156, 358, 091 2017 133,176,277 137,316,999 135,363,107 135.092,937 2018 143,431,614 May 144.262,363 151,701,788 164.165.712 156,079,979 134,054,803 I June 144,326,323 152,327,1323 163,877.979 155,539,426 134,749,185 July 144,069,275 153,278,835 164,576.7051 151.811,989 133.999,570 August September October November December 144,301,134 143, 351, 024 142, 223, 045 1421314,071 143,628, 467 155,091,342 155,730,612 157,507,030 159,194,642 161,652,867 163.322,471 16'3,223,526 162,552,606 162.503,111 161,099, 330 149,561 327 148,363,422 145,579,177 143.635,720 140,818,582 141,504150 140, 069, 506 140, 751,451 140,933,132 142, 516,442 High value Is boxed. Low value Is bared and itallcize4, rneSTR .epn-t,s a p.nca on of STR Inc. Ina STP G•. bal. rto and is',tended solely inr vse by paid subsc en, s.Reprrduc Pun o detdbpdan of the STR 'Freon IRE part. In whole -or panw.thocd written permnssIon n pmhibltea and subject to legal aouan If you have rereved this report and areolOT a sybscnter to the STP. Tlericl.epar, incase crnAa_t us Immediately. 3ourL e. 2018 STF. irl,., 3TF Glooal, LLd. tracing'STR' Tab 10 - Response Report Miami Beach, FL Area Selected Properties Jot NoMber. 98g71i SADIM `tdt 55 Creaed. March 18. 2010 SIR Cade Name si Estattlishmenk City Skate 28012 DoubleTroe Grand Hotel Bisca4+la Bay 1Miarn1, FL 6796 Marriott B0ecame Bay Hotel a Manna Miami, FL 37:A6 use'r,s Miami Beech Hotel Miami Beach, FL 39847 Marne& S'311a100011 I;eadl Miami Beet, FI_ 29395 Caelllac 1lotel &Beach Club Miami Beady, FL Open Chg in ' Zf Cotle Class 1 AR Cate Cake Ramm ns Rs J F M A M J J A 5 O N N J_ F M A M J J A S C N [1 J F M A M J J A 5 0 N N r391$3. 1Up'scele Class Aug1494 Jun1963 219 Y 33182 'Upper Upscale Class Dec 1001 Dec 1983 600 83133 LI0000Class Dec 1998 0e01998 790 33.139 !Uppe, Upscale Gms Sep anon Sea 2000 224 Y 33140 Upp80 Upscale Class May 2018 Jun 1946 0 Y Trt9 Properties 5 tam n - Monrh10 defy ceceved W SIP • - M0011, y kind daily cat+ rer,.n1 l by STR E.lanlc - No data received by STR Y - (Chu in Rms.) aopert0 has erperiencee a r0em addoen ce crap during the time period a1 the report • Tye 6TR Trend Regan Ise pu0llaall¢n 81 SrR, Irc gnu 611, Ol:e,i LA1 ene is rt[ene,e ro1¢1,0rele D; pale a4borlbors, nea.opu+nn r0 Rsalbu+on ntia¢ STR Tra l Reaotl, In wn¢le.cr pall mlrout l' yen penrasoenle nrObltad A101 sublecl to legal acll¢p. ttYau Agee r.hel lhlrnp¢n ar0 alb NOT a auosena¢rto the STR Trend repot, plea. contact us rnrrecnt.rr 6rurce .p18. 3TR, Inc.! 94M r+lobai, Lia Itatlngsa"671, Addenda Addendum C LEGAL DESCRIPTION © 2018 CBRE, Inc. Addenda Legal Description LEf.AL PE-t'GRIPTIaN 11c urm a ¢5131. A rawi4s F.wm Ir lmei prda. vF .A136. 61.6 I.1q aW 6.rr r.. 9.Y6... r ma m 1'. 6 Y7 .will. nu.a 43 cal; airs ter aaaadaly dollm m firmer Ma al a din Yam. m P.M Swam. 19430 p to aridd nip a41®la a.M rayA a d=slim" einiL degratml pier slat Fowl A-u. ti Om. tmre4 nrin u. Isvl.l le tier ire. 56.r Nap 71 et.. Huk kcal. at.Ad. [meets.. aria. ill Falk ea" . °del d +rgrrr w Mel mMir. err I1..r.a P riam* on +a Tr1l *amps r¢ Allem C,oYm ails hatlr.arlwrr mom the P.rrdaitirlr err. d plan Ned and M11614 ..i 111A5 P Iaatt. alai enlrd r111 r1Y lee al Vann .ear1111dw 6 ND V o �i41F R71 Ne1G IV KIK lfch 9F BEG1.1.0 ti care raJd 04 M lerell 4 SIP Mx a Nee mtr 634T 9F �rera ¢ Wet Erma Mari eh. o 7.'e ere h A Fee rercy M it lid Ire a.. 1 ad P, 73 .. ....Jr IYt ES7 3.17 Y - ' 3e"3l43e4. kr 293.34 ia. re 1r err.. a it pair rod 166 4071 *a66Yr.h6lr.f IM ere. eentMdr FMjrt -km" Its of aN Apr +1'!rr [rrht-or 3,w 47ai".. r b u11 rl0im. it nano, rat is a PNrI r'. i�r-�F (A} itv rdeep e Extra. 1e the mouthaml trek.; a rails. Et err tar ° °edm .1 i .11., tar m J3emcr r+ Jtr2A5 +rrt 1Fwea .6 1.10'+.r fil 9A91 iwr 61 frlr 061 del. 1M rrrll„IY l6j.. 41363 # .4 lid Y°c W Iv 1. 34 mi a &We 61M' .1nr,11.4 k lea `drillrorr, rid ,I. .eon i#171.52`i4 tar M wen p} 1.ao daq doe ara Yoh? Iv 11r *reran arc... or now. i... o anrd ari..l 4 130 1 er m rr claim= 6 :21.22 MM too 30 d 1 160 31d err otr1f r{'y 9rir4we rep 1 repri t 4Jrm1rtr.'1 li She r6Ytt.yrl MAIrt M 4.66 a lertr 4 E 1r1BGv¢¢la r I4125 arl, a 83tral .0. a m.e... form cc draw. d a14r5 tit h1r.ea *161 tl.al a}¢..i`Ws hw131. e1 Blesairm. Bar Hrr15. ca4ler deli ■r W rit. ere Fels. .pmTr raw I+} 51r1n'76"E ra 4]* Mae I6} morn 91F9a34 4 Ir 8647 helm 367 reel® 5623YI1t 4. 131.22 1..7 4) thrice. 371.IIi31 r M Ian Irk {31 thee. 919Fd1rTE 3. 1frL16 ,m1c (6} fi.r.. 3e75. Pry dr St32 +rid 373 mu*. 0rgm'2C'E lr 4447 *Al ON 1Mn'a n073341. rd ra2J Mod 10 Ile Mxrclg.:.fi, the .arnet.ly il.. a1 and loom. Erma 1; Item.. =metre aril moll I3r. tor 2a12 rr1 tie Its aid al b.6*r11a aid Ter err.rti.p: Sold h.l 1Mr v1e bit m'..l11Wri. Skein Gm.. fll , owl osti.liy MULTI/5 Kure poor {:. mr�L' rF,.e or la LEg WO Dan Red vrllw, rt A.M. EAR I.% mid ikp.d h1 9.relar. 31 reed °.@. Tlnh.rlp 33 S.M. 36,,. 42 Ere Woe ern wrwl rl, 6YYrl6rd err hkri w d a.151Ira. or PiL AMIN .r d...r11dd erm. eA Iaa17k. and *9Y er ° Fardt aF darker Lia yap i1 *EAT 4eod A-1-A h Lai. Gw.rke FNRet B tl, err emeled h nel 3F err Pry rr Mr %WE Rreatl. err Gale Brook. Fled. rid riot brim Cr P4.SI 04 1a'9r` ,r1 H. ar'6.li4 lF 3, rr* herirchrriro 41 errwd DrioldeYd<+I+.JI Ldtrrct�cc I JI1#'4y 9.,Vdteride Fla 6n .r.IdtirYiWr r911V 71 5 .h Iddrd Jed 1141e l 141J. tf .4JS:ei hear led d .n1N met r1 a'rlT47 lumps W?715`L leg 1r...y+Iw+tMr prd,ver id ltr rift i.e rk i j. r e r nr.116er-0 herr. r61 A *Form..© hrs.Yf ire -4 . perk to 1M rrlrl , :I i-r -Key= Ina de W row 1.11mr 04 racadod 1r 9d11P. 3,3644 for ' 14. °I map 1171 aril 9IIIW I lyryde P]dr Ilex pm" pro 1741 al lir apse Ib.ad a Cede SILO Aa1ir ar..s recliner, dr.R d! .Im.r-sr-.o iM I511-3 Mob la a p.bt W ampere M. a carer rams is is oll1wr4 T..r rrdr,Wrly dap T. ma sr .d1 ar4e Irekrr a adse of rfi1J>6 4. am a 04 6 arm. 21Il1k. _ 1 &Woe M 456 ' $11 1er31. rd3 41`i4 9.31 low r9 .l kern[ ip�rrly Tarr .111*MM d40F4 . 4.31 1M45 Me N a 1'i14 V Assess # ° Row ..doer la r.. m1Anr.rl. l I nsr ,t 612 r dreg 14 cr. it �a redo king e Rd'. a 14.5C2e Melt a-rr.bel r.* err . d lav °r MAIM loot: drum . 111 61 E, illy 16 iH1 end err ddliebed Nh4L a IY1ke6. a1 -. yrr re a Hen r d r.-wet c.F1. r.W7.i Ter 71 . Mee6R ranee Nat-Wi3 a car err rF .21 -aP a rpm al !*airs Mri am a ameba! a..ltr err pr47 d rlamm W fr416 4LR 1 ri rr�W >tY tart End demo beim ¢°irdtlerl itlr te. asps 1 nra3Wr�Iry rijdbFar lie err di Mar Misr Lb�em . 1 r. h uteri Rrr.d, err 6 0 it err I1TI ri ri4714 crew err etre W reap 113d Ed Ye 10 41 Crowd her Gad. 4a.anrb 10 111 53�.+F+e`M. 1699 d.w ra . pMr # err rl a rgflair.k aelrr gm114 M 4Rr.6 1. roc.' IM io re per bare k!r611 4 . k ■r.0 *7 6,77 rlfL drp ter ma H di are; damp a raelm er eµ1,23 and d mewl a.µ... arv:tT. l 1Wwrie ai 35r.x7 yin w l NIA 0 trrpilyd rie+JGr9 eM r arrt 6134 71 a ra the 0Nm•Na6 myrbe i rirecely lily 9M Err lot Mil.6 array •er19 r ml\rr n !aura brr am a r.1tra1 a,�. err IpVrir a d e... e! 12E 1 lrh ltry nerft reerr, 933i irl ti II. acid 19Qitd6 rm nIC RUA".G LAW& mica. as 11W Pe11...r rutgenr 9:4511.9r artl bnw h geak.. it e.i M 1Y.ri0 33 am" %Tim o3 cart eir rem.. aA3a+aM dohmi m ipr.ex Itotnm.6i al M,n F:..L S 4 - ffipt.:t 1 n. di�� sF P.wtin as v.e.r' d ° 7.410.1W M1t l3 k 314. re °A Hr. 43. 1 rr Wan1-G>� earth, axe. Fhaal bode F.rtPr.drl Y. 41.t 6. d 34 Ira' F1 ilt•Thy. %Ida meld amid bin. dr rile el ia'relrr ti♦ Co Dario. d Ir. care nr'l . wos . card. .1 dn.W Dew reds 1a iEr..aa rrlmka .welrnblr 4 m . Yr awn .F imam Wmd rid .ram .F 1ia23i I..l ed a s.Yd ✓ ye or 43e9V5 Cesar rerir(3 L pry err retrench. 3Nared n rt 1lr reel imp .r 11. drew r.41PoM1 are Per a dNta W awes. art' er.a scememee 205,3E irk r Bd Poet et kdni.l err. refl. orszs9g. 4duet he rr:.memo. +1197Vk0'E. 7a m rib item ra6R4i1olfr ra3t ere lends reird"53''4 1e6.34 are rr.q .ns.n.de71 r14,9 rrk itru 611J a11em, m.7 ▪ 1 K q70 +Jed k. d. Fii,t d Write THE SUBJECT IS PART OF A MUCH LARGER SITE AND HAS NO SEPARATE LEGAL DESCRIPTION. ABOVE IS THE LEGAL DESCRIPTION FOR THE LARGER SITE TAKEN FROM SURVEY © 2018 CBRE, hie. Addenda Addendum D ENGAGEMENT LETTER © 2018 CBRE, Inc. Addenda VALIDATION & ADVISORY SERVICES Proposal and Contract for Services CBRE CBRE, Inc. 5100 Town Center Circle Tower II, Suite 600 Boca Raton, Florida 33486 www.cbre.us/valuation March 12, 2018 Scott L. Webb, MAI Vice President -Hospitality Specialist Mark Burns Lease Manager, Dept of Real Estate & Asset Managment CITY OF MIAMI Phone: 305.416.1471 Email: mburns@miamigov.com RE: Assignment Agreement Proposed Jungle Island Hotel, 1111 Parrot Jungle Trail Miami, Florida 33132 Dear Mr. Burns: We are pleased to submit this proposal and our Terms and Conditions for this assignment. PROPOSAL SPECIFICATIONS Purpose: To estimate the Market Value of the referenced real estate and estimate the appropriate percentage rent for the ground lease. Premise: Rights Appraised: Intended Use: Intended User: Reliance: As Is, As Complete, and As Stabilized Fee Simple Internal Decision Making purposes The intended user is CITY OF MIAMI, and such other parties and entities (if any) expressly recognized by CBRE as "Intended Users" (as further defined herein). Reliance on any reports produced by CBRE under this Agreement is extended solely to parties and entities expressly acknowledged in a signed writing by CBRE as Intended Users of the respective reports, provided that any conditions to such acknowledgement required by CBRE or hereunder have been satisfied. Parties or entities other than Intended Users who obtain a copy of the report or any portion thereof (including Client if it is not named as an Intended User), whether as a result of its direct dissemination or by any other means, may not rely upon any opinions or conclusions contained in the report or such portions © 2018 CBRE, 8K. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 2 of 10 March 12, 2018 Inspection: Valuation Approaches: Report Types: Appraisal Standards: Appraisal Fee: Expenses: Retainer: Payment Terms: Delivery instructions: Delivery Schedule: Preliminary Value: Draft Report: Final Report: Start Date: Acceptance Date: thereof, and CBRE will not be responsible for any unpermitted use of the report, its conclusions or contents or have any liability in connection therewith. CBRE will rely on our prior inspection of the subject property on July 14,2017.. All three traditional approaches to value will be considered and utilized as applicable. Restricted Appraisal Report. Client Guidelines/USPAP $3,500 Fee includes all associated expenses A retainer is not required for this assignment. The fee is considered earned upon delivery of the draft report. CBRE encourages our clients to join in our environmental sustainability efforts by accepting an electronic copy of the report. An Adobe PDF file via email will be delivered to mburns@miamigov.com. The Client has requested No (0) bound final copy (ies). Not Required Not Required 15 business days after the Start Date The appraisal process will start upon receipt of your signed agreement and the property specific data. These specifications are subject to modification if this proposal is not accepted within 10 business days from the date of this letter. When executed and delivered by all parties, this letter, together with the Terms and Conditions and the Specific Property Data Request attached hereto and incorporated herein, will serve as the Agreement for appraisal services by and between CBRE and Client. Each person signing below represents that it is authorized to enter into this Agreement and to bind the respective parties hereto, aww.cbre.us/valuation CBRE © 2018 CBRE, IrK. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 3 of 10 March 12, 2018 We appreciate this opportunity to be of service to you on this assignment. If you have additional questions, please contact us. Sincerely, CBRE, Inc. Valuation & Advisory Services Scott L. Webb, MAI Vice President -Hospitality Specialist As Agent for CBRE, Inc. Cert. Gen. RZ2002 - Fiorida T 561-393-1609 Scott.Webb@cbre.com PROPERTY LIST Property Name Properly Location Report Type Appraisal Fee Proposed Jungle Island Hotel Miami, Florida 04-Restricted Report $3, 500 Assignment Total: www.cbre.us/valuation $3,500 CBRE © 2018 CBRE, IrK. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 4 of 10 March 12, 2018 AGREED AND ACCEPTED FOR CITY OF MIAMI: Signature Name Phone Number ADDITIONAL OPTIONAL SERVICES D317/./ir Title il•e tivye5 Gb l E-Mail Address J Assessment & Consulting Services: CBRE's Assessment & Consulting Services group has the capability of providing a wide array of solution -oriented due diligence services in the form of property condition and environmental site assessment reports and other necessary due diligence services (seismic risk analysis, zoning compliance services, construction risk management, annual inspections, etc.). CBRE provides our clients the full complement of due diligence services with over 260 employees in the U.S. that are local subject matter experts. Initial below if you desire CBRE to contact you to discuss a proposal for any part or the full complement of consulting services, or you may reach out to us at WhitePlainsProposals2J)cbre.com. We will route your request to the appropriate manager. For more information, please visit www.cbre.com/ass+ssment. www.cbre.us/valuation Initial Here CBRE 0 2018 CBRE, Inc. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 5 of 10 March 12, 2018 TERMS AND CONDITIONS 1. The Terms and Conditions herein are part of an agreement for appraisal services (the "Agreement" ) between CBRE, Inc. (the "Appraiser') and the client signing this Agreement, and for whom the appraisal services will be performed (the "Client"), and shall be deemed a part of such Agreement as though set forth in full therein. The Agreement shall be governed by the laws of the state where the appraisal office is located for the Appraiser executing this Agreement. 2. Client shall be responsible for the payment of all fees stipulated in the Agreement. Payment of the appraisal fee and preparation of an appraisal report (the "Appraisal Report, or the "report") are not contingent upon any predetermined value or on an action or event resulting from the analyses, opinions, conclusions, or use of the Appraisal Report. Final payment is due as provided in the Proposal Specifications Section of this Agreement If a draft report is requested, the fee is considered earned upon delivery of the draft report. It is understood that the Client may cancel this assignment in writing at any time prior to delivery of the completed report. In such event, the Client is obligated only for the prorated share of the fee based upon the work completed and expenses incurred (including travel expenses to and from the job site), with a minimum charge of $500, Additional copies of the Appraisal Reports are available at a cost of $250 per original color copy and $100 per photocopy (black and white), plus shipping fees of $30 per report. 3. If Appraiser is subpoenaed or ordered to give testimony, produce documents or information, or otherwise required or requested by Client or a third party to participate in meetings, phone calls, conferences, litigation or other legal proceedings (including preparation for such proceedings) because of, connected with or in any way pertaining to this engagement, the Appraisal Report, the Appraiser's expertise, or the Property, Client shall pay Appraiser's additional costs and expenses, including but not limited to Appraiser's attorneys' fees, and additional time Incurred by Appraiser based on Appraiser's then -prevailing hourly rates and related fees. Such charges include and pertain to, but are not limited to, time spent in preparing for and providing court room testimony, depositions, travel time, mileage and related travel expenses, waiting time, document review and production, and preparation time (excluding preparation of the Appraisal Report), meeting participation, and Appraiser's other related commitment of time and expertise. Hourly charges and other fees for such participation will be provided upon request. In the event Client requests additional appraisal services beyond the scope and purpose stated In the Agreement, Client agrees to pay additional fees for such services and to reimburse related expenses, whether or not the completed report has been delivered to Client at the time of such request. 4. Appraiser shall have the right to terminate this Agreement at any time for cause effective immediately upon written notice to Client on the occurrence of fraud or the willful misconduct of Client, its employees or agents, or without cause upon 30 days written notice. 5. In the event Client fails to make payments when due then, from the date due until paid, the amount due and payable shall bear interest at the maximum rate permitted in the state where the office is located for the Appraiser executing the Agreement. In the event either party institutes legal action against the other to enforce its rights under this Agreement, the prevailing party shall be entitled to recover its reasonable attorney's fees and expenses. Each party waives the right to a trial by jury in any action arising under this Agreement. 6. Appraiser assumes there are no major or significant items or issues affecting the Property that would require the expertise of a professional building contractor, engineer, or environmental consultant for Appraiser to prepare a valid report. Client acknowledges that such additional expertise is riot covered in the Appraisal fee and agrees that, if such additional expertise is required, it shall be provided by others at the discretion and direction of the Client, and solely at Clients additional cost and expense. 7, In the event of any dispute between Client and Appraiser relating to this Agreement, or Appraiser's or Client's performance hereunder, Appraiser and Client agree that such dispute shall be resolved by means of binding arbitration in accordance with the commercial arbitration rules of the American Arbitration Association, and judgment upon the award rendered by an arbitrator may be entered in any court of competent jurisdiction. Depositions may be taken and other discovery obtained during such arbitration proceedings to the same extent © 2018 CBRE, I,K. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 6of10 March 12, 2018 as authorized in civil judicial proceedings in the state where the office of the Appraiser executing this Agreement is located. The arbitrator shall be limited to awarding compensatory damages and shall have no authority to award punitive, exemplary or similar damages. The prevailing party in the arbitration proceeding shall be entitled to recover its expenses from the losing party, including casts of the arbitration proceeding, and reasonable attorney's fees, Client acknowledges that Appraiser is being retained hereunder as an independent contractor to perform the services described herein and nothing in this Agreement shall be deemed to create any other relationship between Client and Appraiser, This engagement shall be deemed concluded and the services hereunder completed upon delivery to Client of the Appraisal Report discussed herein. 8, All statements of fact in the report which are used as the basis of the Appraiser's analyses, opinions, and conclusions will be true and correct to Appraiser's actual knowledge and belief. Appraiser does not make any representation or warranty, express or implied, as to the accuracy or completeness of the information or the condition of the Property furnished to Appraiser by Client or others, TO THE FULLEST EXTENT PERMITTED BY LAW, APPRAISER DISCLAIMS ANY GUARANTEE OR WARRANTY AS TO THE OPINIONS AND CONCLUSIONS PRESENTED ORALLY OR IN ANY APPRAISAL REPORT, INCLUDING WITHOUT LIMITATION ANY WARRANTY OF FITNESS FOR ANY PARTICULAR PURPOSE EVEN IF KNOWN TO APPRAISER. Furthermore, the conclusions and any permitted reliance on and use of the Appraisal Report shall be subject to the assumptions, limitations, and qualifying statements contained in the report. 9. Appraiser shall have no responsibility for legal matters, including zoning, or questions of survey or title, soil or subsoil conditions, engineering, or other similar technical matters. The report will not constitute a survey of the Property analyzed. 10. Client shall provide Appraiser with such materials with respect to the assignment as are requested by Appraiser and in the possession or under the control of Client. Client shall provide Appraiser with sufficient access to the Property to be analyzed, and hereby grants permission for entry unless discussed in advance to the contrary. 11. The data gathered in the course of the assignment (except data furnished by Client) and the report prepared pursuant to the Agreement are, and will remain, the property of Appraiser. With respect to data provided by Client, Appraiser shall not violate the confidential nature of the Appraiser -Client relationship by improperly disclosing any proprietary information furnished to Appraiser. Notwithstanding the foregoing, Appraiser is authorized by Client to disclose all or any portion of the report and related data as may be required by statute, government regulation, legal process, or judicial decree, including to appropriate representatives of the Appraisal Institute if such disclosure is required to enable Appraiser to comply with the Bylaws and Regulations of such Institute as now or hereafter in effect. 12. Unless specifically noted, in preparing the Appraisal Report the Appraiser will not be considering the possible existence of asbestos, PCB transformers, or other toxic, hazardous, or contaminated substances and/or underground storage tanks (collectively, "Hazardous Material) on or affecting the Property, or the cost of encapsulation or removal thereof, Further, Client represents that there is no major or significant deferred maintenance of the Property that would require the expertise of a professional cost estimator or contractor, If such repairs are needed, the estimates are to be prepared by others, at Client's discretion and direction, and are not covered as part of the Appraisal fee. 13. In the event Client intends to use the Appraisal Report in connection with a tax matter, Client acknowledges that Appraiser provides no warranty, representation or prediction as to the outcome of such tax matter. Client understands and acknowledges that any relevant taxing authority (whether the Internal Revenue Service or any other federal, state or local taxing authority) may disagree with or reject the Appraisal Report or otherwise disagree with Client's tax position, and further understands and acknowledges that the taxing authority may seek to collect additional taxes, interest, penalties or fees from Client beyond what may be suggested by the Appraisal Report. Client agrees that Appraiser shall have no responsibility or liability to Client or any other party for any such taxes, interest, penalties or fees and that Client will not seek damages or other compensation from Appraiser relating to any such taxes, interest, penalties or fees imposed an Client, or for any attorneys' fees, costs or other expenses relating to Client's tax matters. © 2018 CBRE, Inc. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 7 of 10 March 12, 2018 14. Appraiser shall have ne liability with respect to any loss, damage, claim or expense incurred by or asserted against Client arising out of, based upon or resulting from Clients failure to provide accurate or complete information or documentation pertaining to an assignment ordered under or in connection with this Agreement, including Client's failure, or the failure of any of Client's agents, to provide a complete copy of the Appraisal Report to any third party. 15. LIMITATION OF LIABILITY. EXCEPT TO THE EXTENT ARISING FROM SECTION 16 BELOW, OR SECTION 17 IF APPLICABLE, IN NO EVENT SHALL EITHER PARTY OR ANY OF ITS AFFILIATE, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR CONTRACTORS BE LIABLE TO THE OTHER, WHETHER BASED IN CONTRACT, WARRANTY, INDEMNITY, NEGLIGENCE, STRICT LIABILITY OR OTHER TORT OR OTHERWISE, FOR ANY SPECIAL, CONSEQUENTIAL, PUNITIVE, INCIDENTAL OR INDIRECT DAMAGES, AND AGGREGATE DAMAGES IN CONNECTION WITH. THIS AGREEMENT FOR EITHER PARTY (EXCLUDING THE OBLIGATION TO PAY THE FEES REQUIRED HEREUNDER) SHALL NOT EXCEED THE GREATER OF THE TOTAL FEES PAYABLE TO APPRAISER UNDER THIS AGREEMENT OR TEN THOUSAND DOLLARS ($10,000). THIS LIABILITY LIMITATION SHALL NOT APPLY IN THE EVENT OF A FINAL FINDING BY AN ARBITRATOR DR A COURT OF COMPETENT JURISDICTION THAT SUCH LIABILITY I5 THE RESULT OF A PARTY'S FRAUD OR WILLFUL MISCONDUCT. 16. Client shall not disseminate, distribute, make available or otherwise provide any Appraisal Report prepared hereunder to any third party (including without limitation, incorporating or referencing the Appraisal Report , in whole or in part, in any offering or other material intended for review by other parties) except to (i) any third party expressly acknowledged in a signed writing by Appraiser as an "Intended User" of the Appraisal Report provided that either Appraiser has received an acceptable release from such third party with respect to such Appraisal Report or Client provides acceptable indemnity protections to Appraiser against any claims resulting from the distribution of the Appraisal Report to such third party, (ii) any third party service provider (including rating agencies and auditors) using the Appraisal Report in the course of providing services for the sole benefit of an Intended User, or (iii) as required by statute, government regulation, legal process, or judicial decree, In the event Appraiser consents, in writing, to Client incorporating or referencing the Appraisal Report in any offering or other materials intended for review by other parties, Client shall not distribute, file, or otherwise make such materials available to any such parties unless and until Client has provided Appraiser with complete copies of such materials and Appraiser has approved all such materials in writing. Client shall not modify any such materials once approved by Appraiser. In the absence of satisfying the conditions of this paragraph with respect to a party who is not designated as an Intended User, in no event shall the receipt of an Appraisal Report by such party extend any right to the party to use and rely on such report, and Appraiser shall have no liability for such unauthorized use and reliance on any Appraisal Report. In the event Client breaches the provisions of this paragraph, Client shall indemnify, defend and hold Appraiser, and its affiliates and their officers, directors, employees, contractors, agents and other representatives (Appraiser and each of the foregoing an 'Indemnified Party" and collectively the "Indemnified Parties"), fully harmless from and against all losses, liabilities, damages and expenses (collectively, "Damages") claimed against, sustained or incurred by any Indemnified Party arising out of or in connection with such breach, regardless of any negligence on the part of any Indemnified Party in preparing the Appraisal Report. 17, In the event an intended User incorporates or references the Appraisal Report, in whole or in part, in any offering or other material intended for review by other parties, Client shall indemnify, defend and hold each of the Indemnified Parties harmless from and against any Damages in connection with (i) any transaction contemplated by this Agreement or in connection with the appraisal or the engagement of or performance of services by any Indemnified Party hereunder, (ii) any actual or alleged untrue statement of a material fact, or the actual or alleged failure to state a material fact necessary to make a statement not misleading in light of the circumstances under which it was made with respect to all information furnished to any Indemnified Party or made available to a prospective party to a transaction, or (iii) an actual or alleged violation of applicable law by an Intended User (including, without limitation, securities laws) or the negligent or intentional acts or omissions of an Intended User (including the failure to perform any duty imposed by law); and will reimburse each Indemnified Party for all reasonable fees and expenses (including fees and expenses of counsel) (collectively, "Expenses") as incurred in connection with investigating, preparing, pursuing or defending any threatened or pending claim, action, © 2018 CBRE, I,K. Addenda VALUATION & ADVISORY SERVICES Mark Burns Assignment Agreement Page 8 of 10 March 12, 2018 proceeding or investigation (collectively, "Proceedings") arising therefrom, and regardless of whether such Indemnified Party is a formal party to such Proceeding. Client agrees not to enter into any waiver, release or settlement of any Proceeding (whether or not any Indemnified Party is a formal party to such Proceeding) without the prior written consent of Appraiser (which consent will not be unreasonably withheld or delayed) unless such waiver, release or settlement includes an unconditional release of each Indemnified Party from all liability arising out of such Proceeding. 18. Time Period for Legal Action. Unless the time period is shorter under applicable law, except in connection with paragraphs 16 and 17 above, Appraiser and Client agree that any legal action or lawsuit by one party against the other party or its affiliates, officers, directors, employees, contractors, agents, or other representatives, whether based in contract, warranty, indemnity, negligence, strict liability or other tort or otherwise, relating to (a) this Agreement or the Appraisal Report, (b) any services or appraisals under this Agreement or (c) any acts or conduct relating to such services or appraisals, shall be filed within two (2) years from the date of delivery to Client of the Appraisal Report to which the claims or causes of action in the legal action or lawsuit relate. The time period stated in this section shall not be extended by any incapacity of a party or any delay in the discovery or accrual of the underlying claims, causes of action or damages. © 2018 CBRE, 8K. Addenda VALUATION & ADVISORY SERVICES Proposal and Contract for Services SPECIFIC PROPERTY DATA REQUEST In order to complete this assignment under the terms outlined, CBRE, Inc., Valuation & Advisory Services, will require the following specific information for the property: 1. PLEASE NOTIFY US IMMEDIATELY IF ANY OTHER CBRE SERVICE LINE (INCLUDING CAPSTONE) IS INVOLVED IN THE BROKERAGE, FINANCING, INVESTMENT OR MANAGEMENT OF THIS ASSET. 2. Current title report or title holder name 3. Legal description 4. Survey and/or plat map 5. Site plan for proposed or entitled development 6. Lot -by -lot summary of gross building net building areas 7. Individual unit plans, elevations and square faotages 8. Building plans and specifications, including square footage, for any community facilities 9. Current county property tax assessment or tax bill and information an the projected effective tax rate (including all potential special assessments) 10. Details on any sale, contract, or listing of the property within the past three years 11. Details regarding any proposed sales concessions to be offered 12. Details regarding any proposed premiums 13. Development pro forma (including product pricing/sales summary, hard costs, soft costs and absorption estimate) 14. Any marketing reports and/or local competitive studies 15. Any previous marketldemand studies or appraisals 16. Name and telephone number of property contact for physical inspection and additional information needed during the appraisal process 17. Any other information that might be helpful in valuing this property If any of the requested data and information is not available, CBRE, Inc., reserves the right to extend the delivery date by the amount of time it takes to receive the requested information or make other arrangements. Please have the requested information delivered to the following: www,cbre.us/valua Scott L. Webb, MAI Vice President -Hospitality Specialist scott.webb@cbre.com CBRE, Inc. Valuation & Advisory Services 5100 Town Center Circle, Tower II, Suite 600 Boca Raton, Florida 33486 CBRE © 2018 CBRE, Inc. Addenda Addendum E QUALIFICATIONS © 2018 CBRE, Inc. Addenda Scott L. Webb, MAI [`ice President -Hospitality Specialist, Florida -Caribbean Region CBRE T + 1561-393-1609 Scott.webb@cbre.com www.cbre.com/Scott. Webb 5100 Town Center Ci rche Tower II, Suite 600 Boca Raton, FL 33486 Clients Represented • Bank of America Merrill Lynch • SunTrust Bank • PNC Bank • Mercantil • Credit Suisse • Goldman Sachs • Regions Bank • Bank United • BB&T Bank • CitiBank • Deutsche Bank • Ocean Bank • Centennial Bank • Bank of the Ozark • First Bank Florida • Sun Trust Bank Experience Scott Webb joined CBRE Valuation & Advisory Services department in the Boca Raton office in 2001. Mr. Webb has over thirty years of real estate appraisal and consulting experience throughout the United States, Florida and the Caribbean. Mr, Webb has a Bachelor of Science in Economics from Florida State University. He is a designated Member of the Appraisal Institute (MAI) and holds the General Accredited Appraiser (GAA) designation from the National Association of Realtors and is licensed as a Certified General Real Estate Appraiser in the State of Florida As a Vice President, Mr. Webb performs valuation and consulting assignments on various property types in Miami -Dade, Broward, Palm Beach, Monroe, Collier and Martin Counties. Additionally, Mr. Webb has performed numerous appraisals and market studies throughout the Caribbean since the early 1990's. Mr. Webb has specialized experience in the completion of appraisals and market studies for hospitality -related properties He is a member of the Valuation & Advisory Services' Hospitality & Gaming Group. Prior to joining CBRE Mr. Webb was at PKF Consulting in Miami, Florida. Professional Affiliations / Accreditations • Appraisal Institute — Designated Member (MAI), Certificate No, Pending • National Association of Realtors, General Accredited Appraiser (GAA), No. 4627 • Certified General Real Estate Appraiser, State of Florida, RZ2002 Education • Florida State University, Tallahassee, FL _ Bachelors of Science in Economics - 1986 ©2018 CBRE, Inc. Addenda STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION FLORIDA REAL ESTATE APPRAISAL BD 2601 BLAIR STONE ROAD TALLAHASSEE FL 32399-0783 WEBB, SCOTT L 5335 NW 49TH CT COCONUT CREEK FL 33073 Congratulations! With this license you become one of the nearly one millton Floridians licensed by the Department of Business and Professional Regulation. Our professionals and businesses range from architects to yacht brokers, from boxers to barbeque restaurants, and they keep Florida's economy strong Every day we work to improve the way we do business in order to serve you better. For information about our services, please log onto www.myfloridalicense.com. There you can find more information about our divisions and the regulations that impact you, subscribe to department newsletters and learn more about the Department's initiatives. Our mission at the Department is: License Efficiently, Regulate Fairly. We constantly strive to serve you better so that you can serve your customers. Thank you for doing business in Florida, and congratulations on your new license! RICK SCOTT, GOVERNOR 850-487-1395 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION RZ2002 ISSUED: 11/29/2016 CERTIFIED GENERALAPPRAISER WEBB, SCOTT L IS CERTIFIED under the provisions of Ch.475 FS EKpration tlate NOV 34 2a1B L7611290002474 DETACH HERE KEN LAWSON, SECRETARY STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION FLORIDA REAL ESTATE APPRAISAL BD LICENSE NUMBER R22002 The CERTIFIED GENERAL APPRAISER Named below IS CERTIFIED Under the provisions of Chapter 475 FS. Expiration date: NOV 30, 2018 WEBB, SCOTT L 5100 TOWN CENTER CIRCLE TOWNER II SUITE 600 BOCA RATON FL 33486 ISSUED: 11/29/2016 DISPLAY AS REQUIRED BY LAW SEC # L1611290002474 ©2018 CBRE, Inc. Addenda James E. Agner, IIAI, AI= RS Senior Managing Director, Florida -Caribbean Region CBRE T + 1 305 381 6480 james,agner(cbre.com www.cbre.com/James.Agner 777 Brickell Ave., Suite 1100 Miami, FL 33131 Clients Represented • LNR Partners • Bank of America Merrill Lynch • SunTrust Bank • PNC Bank • Mercantil • Popular Community Bank • 5/3 Bank • Iberia Bank • Santander Bank • Regions Bank • TD Bank • Bank United • BB&T Bank • CitiBank • Deutsche Bank • Ocean Bank • Centennial Bank • Bank of the Ozark • First Bank Florida Experience James Agner is the Senior Managing Director of the Valuation & Advisory Services for the Florida - Caribbean Region. Located in the CBRE Miami office since 1995, Mr. Agner has over thirty years of real estate appraisal and consulting experience throughout the State of Florida, with primary experience in South Florida and in the Caribbean. Mr. Agner is a designated member of the Appraisal Institute (MAI) and General Review Specialist (AI-GRS), member of the Society of Golf Appraisers (SGA), and Royal Institution of Chartered Surveyors (MRICS) and is licensed as a Certified General Real Estate Appraiser in the State of Florida and Georgia. He also has provided expert witness testimony in the Circuit Courts —State of Florida and United States Bankruptcy Courts. As Senior Managing Director, Mr. Agner leads a valuation and advisory staff in Miami and Palm Beach Counties that provides exceptional quality appraisal work and client service in South Florida, Treasure Coast and the Florida Keys. He also coordinates all activities for Florida and in the Caribbean, including overseeing new business development, client relations and appraisal quality control production. Mr. Agner is also the National Director of the Golf Valuation Group and the Net Lease Valuation Group for CBRE. Professional Affiliations / Accreditations • Appraisal Institute — Designated Member (MA!), Certificate No. 7791 • Appraisal Institute —General Review Specialist (Al-GRS), Certificate No. 69150 • Society of Golf Appraisers (SGA), Certificate No. 25 • Royal Institution of Chartered Surveyors —Member (MRICS), Certificate No. 7505662 • Certified General Real Estate Appraiser, State of Florida, #RZ382 • Certified General Real Estate Appraiser, State of Georgia, #345321 • Licensed Real Estate Broker, State of Florida, BK402088 Education • Florida State University, Tallahassee, FL _ Bachelors of Science in Business Administration, Marketing - 1981 © 2018 CBRE, IrK. Addenda STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION FLORIDA REAL ESTATE APPRAISAL BD 2601 BLAIR STONE ROAD TALLAHASSEE FL 32399-0783 AGNER, JAMES E 777 BRICKELLAVENUE MIAMI FL 33131 Congratulations! With this license you become one of the nearly one million Floridians licensed by the Department of Business and Professional Regulation Our professionals and businesses range from architects to yacht brokers, from boxers to barbeque restaurants, and they keep Florida's economy strong Every day we work to improve the way we do business in order to serve you better. For information about our services, please log onto www.myflorldalicense.com. There you can find more information about our divisions and the regulations that impact you, subscribe to department newsletters and learn more about the Department's initiatives. Our mission at the Department is: License Efficiently, Regulate Fairly We constantly strive to serve you better so that you can serve your customers. Thank you for doing business in Florida, and congratulations on your new license! RICK SCOTT. GOVERNOR LICENSE NUMBER 850-487-1395 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION ISSUED: 09/2512016 CERTIFIED GENERALAPPRAISER AGNER, JAMES E IS CERTIFIED under the provisions of Ch 475 FS Ezpir l n date NOV 30 2019 L1E09250003799' DETACH HERE KEN LAWSON, SECRETARY STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION FLORIDA REAL ESTATE APPRAISAL BD The CERTIFIED GENERAL APPRAISER Named below 15 CERTIFIED Under the provisions of Chapter 475 FS. Expiration date NOV 30. 2018 AGNER, JAMES E 777 BRICKELLAVE SUITE 910 MIAMI FL 33131, ISSUED: 09I2aL U b UISYLAY 14, r ULJItttU YJY LHVV SEi] A L1bLI Z000U3F 9 0 2018 CBRE, Inc.