Ownership Changes During the Compliance Period: A Seller’s Perspective

1. structuring general partner transfers and secondary market sales Ownership Changes During the Compliance Period: A Seller’s Perspective Tom MangumVice PresidentNational Tax Credit Advisory GroupT: 614.430.5042tom.mangum@cbre.com

2. A Seller’s Perspective • About CB Richard Ellis & The National Tax Credit Advisory Group • CB Richard Ellis • Nation’s Largest Real Estate Services Company • $52.7 Billion in Investment Property Sales in 2006 • $22.5 Billion in Multi-Housing Sales in 2006 • 150 ± Offices in 37 States • National Tax Credit Advisory Group • Specializes in the Sale of LIHTC Properties Throughout the Country • Sold over 60 LIHTC Properties (About Half GP Interest Sales) • Current Listings Include 2,348 Units.

3. A Seller’s Perspective Types of Ownership Transfers Fee Simple (Asset Sale) GP Interest LP Interest GP & LP Interests

4. A Seller’s Perspective GP Motivations • Realize Upside • Recycle Capital • Underperforming Property • Manage / Diversify Risk • Change of Business Plan • Administrative • Because You Can Whatever your motivation it must be aligned with your partners’

5. A Seller’s Perspective Determining the Appropriate Type of Ownership Transfer • Restrictive Covenants, Partnership & Other Agreements • Bonds • LIHTC • HUD • Right of First Refusal / Puts / Calls • Property Performance • Ongoing Liability / Guarantees • Risk • Upside

6. A Seller’s Perspective Determining the Appropriate Type of Ownership Transfer • LP (What’s In It For Me?) • Value of Remaining Tax Benefits and Cash Flow and Likelihood of Receiving Them VS. • Value Realized from Fee Simple Sale or LP Sale (Net of Costs Such As Recapture Bonds, Legal Fees, Etc...) • Quality of New / Replacement GP • Re-Syndication Value • At What Point in Initial 15 Year Compliance Period continued from previous page

7. A Seller’s Perspective Generally Speaking Performing Properties Underperforming Properties Could Be Candidates For All Options Depending on Circumstances

8. A Seller’s Perspective Specific Considerations for GP Interest Sales • Preparation • Communicate With Your Constituents/Partners • Know Your Position • What Benefits Are You Entitled To? • What Can and Can’t You Do? • Documentation • Financial Statements / Audits / Tax Returns • Compliance • Loan Documents • Partnership & Related Documents • Restrictive Covenants / LURAs • Schedule of LIHTCs By Year • Key Dates Know Your Position_____

9. A Seller’s Perspective Specific Considerations for GP Interest Sales • Preparation (Continued) • Packaging (Individual VS. Portfolio) • Good With the Bad • Geography • Syndicators, Lenders, Partners • Closings • Pool of Buyers • Complexity • Valuation • Marketing Know Your Position_____

10. A Seller’s Perspective Specific Considerations for GP Interest Sales • Buyer Evaluation • Financial Strength & Experience of New GP • Existing Relationships • Lender(s) • State Agency • Syndicator / Tax Credit Investors • Ability to Close on Time and as Agreed • Consents, Consents, Consents • LP / Tax Credit Investor(s) • State Housing Agency • Non-profit Partner • Lender(s) / Servicer(s) • HUD • Process / Documentation • LOI Contract to Acquire or Amend? • Existing or New LP Agreement? continued from previous page Ability to Close_______ Likelihood & Speed of Approvals

11. A Seller’s Perspective Specific Considerations for GP Interest Sales • Deal Terms & Structure • Fees & Costs • Guarantees • Indemnifications (Pre/Post Closing) • Assignment of GP Assets / LiabilitiesOutstanding Equity from LP • Capital Improvements • Loan Conversions • Underperforming Properties • Operating Reserves • Administrative Sale or True Sale (GAAP) • Timing • Process Can Be Long and Slow (Consents) • Transition / Closing continued from previous page

12. Questions Tom MangumVice PresidentCB Richard Ellis National Tax Credit Advisory GroupT: 614.430.5042tom.mangum@cbre.com