1. “Stability & Strength”

2. Tight lines and a fairly strong header for a closet

3. The Economic Indicators The Economic Indicators  2014 U.S. GDP estimated to end at 5% (A Huge Recovery)  2015 Projections for U.S. GDP range from 3.0% to 3.3%  2015 Projections for Global GDP Growth at 2.9%  U.S. GDP Growth Averaged 3.24% (1947 to 2013)  U.S. Unemployment decreased from 7.0% (end 2013) to 5.8% (end 2014), which was a 17% decrease  Washoe County Unemployment decreased from 8.2% (end 2013) to 6.4% (end 2014), which was a decrease of 22%  Remember when…Washoe County ended 2010 at 13.2% unemployment and the current unemployment rate is 6.4%, a 52% decrease in four short years Sources: U.S. Bureau of Labor Statistics, St. Louis Fed. The World Bank The Economist

4. Source: U.S. Dept. of Labor-Bureau of Labor Statistics 4.7%

5.  Washoe County home prices increased 9% from Nov. 2013 to Nov. 2014  Home prices are expected to rise in 2015  No major apartment projects came on line  The factors above bolster improvements and strength in the apartment market (i.e. rising rents and continued declining vacancy rates) Source: Reno-Sparks Association of Realtors*

7. Apparently the Incas had a slight soil compaction problem in this one area

8. Apartment Sales 2014 Project NameCitySale PriceUnitsPrice/UnitCap Rate Closing Date Mountain View Apartments Reno$950,00025$38,000-5/8/2014 Banbridge Sparks$5,300,000128$41,4066.37%11/20/2014 Moran Apartments Reno$1,402,50028$50,089-7/29/2014 Green Leaf Pines Reno$5,925,000116$51,0786.60%1/28/2014 Carlin Apartments Reno$1,125,00022$51,1367.25%8/15/2014 Woodside Village Reno$14,900,000250$59,6006.82%1/23/2014 Talus Point Condominiums Reno$9,000,000125$72,0005.75%7/2/2014 310 Maine Street Reno$1,029,00013$79,154-5/7/2014 Eastland Hills Sparks$27,500,000296$92,9056.01%8/19/2014 The Alexander @ S. Virginia Reno$55,300,000350$158,0005.65%4/23/2014

9. Continued Improving Employment Rates Continued Improving Consumer Confidence Leveling, but Stable Increases in U.S. GDP Modest increases in Apartment Supply (should be easily absorbed, no negative effect on vacancy rates or average rents) Housing Prices Rise (8%-12%) Similar to 2014 Mortgage Rates Remain Low (3.25% to 4%) Regional Population & Job Growth = New Housing Formation = Demand for Apartments and SFR

10.  #1 San Francisco, #3 San Jose, #4 Oakland, #6 San Diego, #8 Los Angeles (5 of the top 10 strongest apartment markets in the U.S. are in California = Nevada apartments benefit)  National vacancy rates dipped as low as 4.2% in 2014 and ended the year at 4.7%  Homeownership dropped to a 19-year low of 64.4% nationally (more renters by choice)  238,000 apartment units were completed in the U.S. in 2014 and all absorbed easily  210,000 units estimated for completion in 2015

11.  Nationally, 2014 apartment values were 13% above 2007 peak values (caused by cheap capital and soaring investor sentiment)  Existing Class A assets often priced at a premium to replacement cost (opportunity for new development or renovation of old assets)  Apartments are the most favored asset class due to the direct and immediate benefit that job growth and new housing formation provide

12. Probably not OSHA approved ladder & scaffolding

13. Multi Family 2015 Forecast  Vacancy Rate Ends 3Q 2015 at 3.2%  Slight uptick, but at the low end of our long term healthy range of 3% to 5%  Average Rents Rise By 2.0% to End 3Q 2015 at $900  $900 Average Rent will be a first for the Reno-Sparks area, a new benchmark