BROKER OPINION OF VALUE FOR

Dear Mr. Mack,

Thank you for allowing us to review and evaluate Longfellow Place & Prospect Manor. We are pleased to provide you with an in-depth overview of the current transactional market and the market for affordable projects, as well as our thoughts on its strategy and value.

We have devised a proposed marketing campaign and timeline that we believe will help achieve the best results for the sale of Longfellow Place & Prospect Manor. Our valuation is based on a comprehensive analysis of the documents you provided, our research and market analysis, and our extensive transactional experience. Given the unique location of Longfellow Place & Prospect Manor, we are confident that The Affordable Housing Group can capitalize on this opportunity and achieve premium results in both price and terms.

We have meticulously scrutinized all facets of the project and identified any potential obstacles to selling Longfellow Place & Prospect Manor. As a result, we have outlined a customized marketing strategy that will enable us to successfully complete the sale at the maximum value. Our comprehensive approach ensures that no detail is overlooked, instilling confidence in our ability to deliver the best results.

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VALUE

Longfellow Place & Prospect Manor present an exceptional opportunity for an incoming buyer to maintain the project’s status as affordable communities. This unique opportunity, combined with our estimated project value of approximately $23,000,000 to $25,000,000, creates an exciting prospect for potential buyers. The ability to utilize Low-Income Housing Tax Credits (LIHTC) further enhances this opportunity, with Maine providing an application submission period that generally concludes in September for credit allocations in the subsequent year.

Optimistically, aiming for a sale by the first quarter of 2026, typically a 45-day marketing process, with an additional 30-45 days required for due diligence (assuming timely third-party reports and a favorable environmental assessment), would be advisable. However, it is important to note that the projected value is subject to change due to legislative reforms and shifts in interest rates.

Value Declaration

Upon a Tax Credit execution, an incoming buyer would invest approximately $75,000 per unit—the minimum required by Maine Housing for an acquisition/rehabilitation project—in property renovations. This renovation along with the execution of a new 20-year HAP contract would allow for expense reductions in Repairs and Maintenance and an increase in subsidized rents of $546 per unit per month, highlighting the potential financial benefits of this investment. The property is currently subsidized by two twenty-year HAP contracts which expire in 2037 and 2038 for Longfellow Place and Prospect Manor respectively. It is anticipated that the project will be eligible to execute new 20-year HAP contracts and achieve a mark-up-to-market in rents, which we estimate may be considerable due to the embedded value of the current rents being significantly below market. The property provides an ideal LIHTC purchase that would utilize Freddie Mac Tax Exempt financing that would provide competitive loan terms while achieving a high speed of closing, thereby reducing risk.

Overall, we believe Longfellow Place & Prospect Manor present excellent investment opportunities and great candidates for a LIHTC syndication that would ultimately uncover the highest price while preserving the project’s affordability for generations to come.

The Affordable Housing Group Marketing Platform

For the past 25+ years, our team has developed a highly effective and greatly enhanced state-of-the-art Artificial Intelligence marketing platform that instantly matches up the highest probability pool of buyers. This platform has proven to maximize seller proceeds, tighten timelines, and increase the probability of successful closing. Our general process is outlined below.

We have determined that the most optimistic time to move forward with a sale would be upon being awarded the exclusive assignment, which would include a six-month term with a commission that is either a fixed percentage or a performance-based fee structure. In our experience, a fixed percentage fee for this type of service is between two and a half to three percent. If a performance-based fee is preferred, we will set a bottom fee of two percent with escalators once a milestone is achieved, typically with each five hundred-thousand-dollar increment resulting in a 25 bps increase in compensation.

After being exclusively hired to facilitate the sale of Longfellow Place & Prospect Manor, we will engage a professional photographer to take high-quality aerial and property photos, showcasing its best features. Our marketing team will then spend a week creating and finalizing marketing materials and a property website, which will be launched with an email campaign to our nationwide pool of qualified buyers.

All prospective buyers who express interest in the property will be required to sign a Confidentiality Agreement prior to being granted access to financial information. Our team will then contact each group by phone to discuss the opportunity, regulatory issues, and ways to maximize their offer. Our firm will aggressively market the deal through various channels, including site tours for qualified buyers vetted by our team for 60 days.

Our senior team members will lead site tours scheduled for efficiency and minimal disruption for your staff and tenants. During tours, prospective buyers will have the chance to see the property, ask questions, and address any concerns. After the tours, we will announce a Call for Offers deadline and analyze the offers to present you with Letters of Intent and a summary of each offer.

To encourage competition and maximize value, we typically hold a Best & Final round of offers among the top bidders. We offer you the option to meet with your top potential buyers for a brief interview, which can increase trust and ensure that the buyer’s goals align with yours. Once we have selected a buyer, we will assist in facilitating PSA negotiations while keeping your best interests as our priority.

Finally, once under contract, our team will facilitate the distribution of all due diligence items, coordinate third-party site visits, communicate between buyer and seller, and manage the escrow process to ensure a smooth transaction and timely closing. Our team will provide regular updates and progress reports throughout the marketing and transaction process. If you prefer a limited marketing campaign, our team can reach a target pool of the most qualified and experienced buyers. We will always advise you of the transaction’s progress during the escrow process.

The Affordable Housing Group is a devoted team committed to expanding and protecting affordable housing opportunities for low-income families and individuals across the United States. Our group of seasoned industry experts possesses a deep understanding of the complexities and nuances of the affordable housing market, and we have the experience and skill to navigate this industry. We are well-connected with qualified investors and buyers throughout the country, and our national reach ensures that our listings gain exposure to the most qualified and capable buyers. By marketing Longfellow Place & Prospect Manor, we are confident that our extensive network will attract the ideal buyer to develop and enhance this affordable housing community. Our finger is on the pulse of the affordable housing industry, and we closely track all the latest trends, including active buyers, sellers, and investors. We can provide our clients with the most up-to-date and relevant market knowledge, which is crucial in this ever-changing market. Our team is excited about the prospect of listing and marketing the sale of Longfellow Place & Prospect Manor, and we are eager to begin our 60-day marketing campaign to generate multiple highly qualified offers.

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