Property Managementand Leasing

“As a recognized leader in the commercial leasing and propertyAs a recognized leader in the commercial leasing and property management industry, our mission is to create and implement

management plans that exceed our clients’ goals and expectations.”

Offices in Birmingham and Huntsville Alabama(888) 539-1686 | www.chasecommercial.comAn AMO® Company

ExecutiveSummaryy

NAI Chase CommercialLeading full service real estate companyNAI – International ResourcesExtensive Commercial Management ExperienceAdvanced Information Systems

Marketing and LeasingGlobal Network of AgentsPowerful MarketingTenacity

Liability ProtectionEstablished Emergency ResponseCost-savings from property insurance

Lease AdministrationSingle Source software to ensure all rent-ups & reconciliations occurLease enforcement procedures - rent collection to premises condition

MaintenanceVolume bidding for highest quality at lowest contract pricesVolume bidding for highest quality at lowest contract pricesProperty inspections for quality controlContract administration and enforcementCertificate of Insurance trackingPreventative Maintenance ProceduresRepair request tracking system

Financial AdministrationPowerful software and flexible reportsPowerful software and flexible reportsFull financial package including income, expense and control reportsBudget to actual comparison for monthly and year-to-date income and expensesBank ReconciliationsAudit procedures

Internal AccountabilityAccounts ReceivablesLease RenewalsLease RenewalsBudget ComparisonResponse TimeTenant RelationsTrend AnalysisReport timing and accuracy

Other Available ServicesAsset ManagementAsset ManagementFinanceDevelopmentConsultingReceivership

An AMO® Company

NAI Chase Commercial

Vision StatementEthics, integrity, execution; NAI Chase Commercial strives for excellence inall facets of real estate services in order to provide our clients with premierservices and best practices in the industry. Our team transforms forwardthinking ideas into cutting edge applications, to achieve maximum results forour clients, company and communityour clients, company and community

BackgroundNAI Chase Commercial and its principals have over $320 million and 60years of combined real estate experience and is a leading full-service realestate organization with the ability to handle all facets of real estatetransactions. NAI Chase Commercial grew by solving the real estateproblems of its diverse client base and capitalizing on market conditions andcompetitive weaknesses.p

Today, NAI Chase Commercial manages office, retail, and industrial spacevalued well in excess of 200 million dollars and is recognized as one of theleading commercial property management and brokerage firms in Alabama.The company is organized in mutually supportive areas.

Property ManagementLeasing and BrokerageAcquisition and DispositionFacilities and Building MaintenanceFinanceConstruction/RenovationDevelopment and Build to Suit ServicesAdaptive Reuse and Strategic PlanningLand Acquisition

T b ithi h id ti i ll t fTeam members within each area provide expertise in all aspects ofcommercial real estate and allow resources to be seamlessly integrated toprovide clients with unsurpassed flexibility and responsiveness.

N ti l d I t ti l RNational and International ResourcesNAI Chase Commercial is the NAI affiliate exclusively representing Centraland North Alabama. NAI is the world’s largest affiliation of independentregional companies and represents more management and brokerageassignments than any other affiliation or company. This affiliation allows NAIChase Commercial to represent properties for leading corporations andbuyers throughout the country. NAI gives NAI Chase Commercial the abilityto represent real estate interests on a scale that is not available to any otherreal estate organization in this marketreal estate organization in this market.

An AMO® Company

Information Systems& Integrationg

NAI Chase Commercial offers unmatched information systems for propertymanagement, accounting, leasing and brokerage. We use PC-based systemswith file servers over local and wide area networks as well as web basedapplications. Using internet connections, D-0 lines, desk top computers, laptops,i-Pads, and smart phones we are able to access all of our information from justabout anywhere.y

Chase’s information systems are designed to provide a full “360 degree” view ofthe tenant and property performance. Our team, with the “click of a mouse”, (orin the field, “a touch of a screen”) can readily see such items as: a leasedocument and all of its amendments, outstanding rent, lease options, leaseexpirations, rent increases, payment history, written correspondence, repairtickets, and notes of all pertinent telephone calls and face to face conversations.Along with our philosophy of capturing information at the time of its occurrence,our information systems design provides all of our team with a real time andunparalleled grasp of all information needed to be highly effective in managingeach and every property.

Several software applications are used to achieve our information systemsdesign goals. CenterSoft™ for accounting and lease administration; Angus™ fortenant repair requests, preventative maintenance and repair responsibilitytracking; Dropbox keeps our key information in sync whether at a desktop,l t bil t bl t t h REA™ id t ki f b ildilaptop, mobile tablet, or a smart phone; REA™ provides tracking of buildingcanvassing and CRM for leasing, brokerage and tenants; and Microsoft SQLServer is used for our electronic document and correspondence filing.

An AMO® Company

WhyNAI Chase Commercial?

Professional property management is critical to ensuring the longevity andvitality of your commercial real estate investment. NAI Chase Commercialprovides proactive management and integrated resources to preserve andenhance the value of each of your company’s real estate assets.

Our NAI network, which currently manages more than 300 million square feet,shares best practices and stays on the absolute cutting edge of the industryshares best practices and stays on the absolute cutting edge of the industry.We stay on top of market trends by actively participating in organizations suchas the Certified Commercial Investment Member (CCIM), Institute of RealEstate Management (IREM), Building Owners and Managers Association(BOMA), National Association of Industrial Office Parks (NAIOP), InternationalCouncil of Shopping Centers (ICSC), and the Society of Industrial and OfficeRealtors (SIOR).

We devise and implement a plan that increases cash flow and return on yourinvestment ultimately creating additional value for you This goal may seeminvestment, ultimately creating additional value for you. This goal may seemobvious, but it is a continuing challenge for investors everywhere. NAI Chase’sProperty Managers begin with the fundamentals of property management thenthink well beyond the obvious to deliver innovative and actionable solutions foryour assets.

When making the final decision about a professional property managementprovider, we believe the decision often becomes one concerning more thanprograms, procedures, technology and reputation. The ultimate decision oftenconcerns the people involved with providing the service.

We are an Accredited Management Organization®

Certified Property Managers® lead property management for all properties.

We have highly experienced and designated brokerage and leasing agents.

Tenant relationships are developed and maintained, an essential part of our marketing campaigns.

We KNOW our markets.

We are global in our thinking, yet local in our approach.

The individuals that are NAI Chase Commercial have a personal desire to do the best. Working as a unified team, NAI Chase Commercial is able to harness the combined creativity and drive to produce superior quality and results. That is why NAI Chase Commercial is known for “Strength of Experience, Power of Vision”

AMO ® firms are recognized for high performance experience, stability

and financial accountability

of Vision .

An AMO® Company

Marketing & LeasingServices

Power of the NAI Global NetworkNAI is one of the world’s top brokerage services companies, with 5,000professionals in 350 member firms located in 55 countries. It is the world’slargest managed network of commercial real estate firms and consummatesover $45 billion in real estate transactions annually. NAI Global is not just anetwork — we’re a managed network structured to provide smart thinking andg p gfast action on behalf of clients operating in corporate, institutional andgovernment sectors around the world. We move with the efficiency andflexibility of a strong, nimble organization leveraging our local expertise andglobal relationships to access the best opportunities, locally, nationally andworldwide.

Advanced and Aggressive MarketingWe evaluate your property's strengths, weaknesses and competitive marketopportunities. We make solid recommendations to improve the marketperception of a property, to make it more attractive to potential users, or toreposition and reintroduce it with broader appeal or greater revenue potential.

NAI Chase Commercial maintains the highest standard for marketing allclasses of properties and types of space. Quality marking materials areincorporated in a multifaceted distribution of information. Highly-visible andvery recognizable signs generate calls. Flyers, direct mail, and direct email are

d t i f ti t th t t d b k itiused to convey information to the tenant, owner and brokerage communities.Internet marketing incorporates a number of sites: CoStar, Loopnet,CCIMREDEX, Google, Lycos, OLX, Oodle, Propbot, Vast, Commercial Source,Property Line, Real Up, and Proxio, as well as the power of the proprietary NAIGlobal internal marketing network.

NAI Chase Commercial also markets the old fashion way, we canvas our localmarkets. By continually canvassing we achieve a comprehensiveunderstanding of competitive buildings strengths and weaknesses as well asunderstanding of competitive buildings strengths and weaknesses as well asupcoming lease expirations, expansions, or contractions. Continually talking tobusinesses throughout our local markets provides us the information to attractnew tenants to our properties by knowing who, what and when opportunitieswill arise.

ReportingWe incorporate Contact Relationship Software in our leasing/brokerageprocess Thus we are able to provide very accurate and up to the minuteprocess. Thus we are able to provide very accurate and up to the minutecontact reporting. Our management team receives a daily contact and activityreport from all leasing associates allowing upper management to both monitorand pro-actively assist all leasing associates.

The standard monthly reporting package includes:Contact reportActivity Pipeline reportLease Expiration reportease p at o epo tVacancy report

An AMO® Company

NAI Chase Commercial SpecialtiesRetailOfficeMedicalCorporateI d t i lIndustrialGovernment facilities (local, state and federal)

Services we provide within our specialties:

Landlord/Owner RepresentationIn-depth market and property analysisProper positioning strategyTenant mix analysisTenant mix analysisLeasing plansAggressive marketingProfessional marketing materialsPre-qualification of potential tenantsSite tours: Attendance of all prospect toursProposal preparation and deliverySkilled negotiations of contract terms and conditionsLease contract preparation and deliveryLease contract preparation and deliverySite SelectionInvestment and Feasibility AnalysisBuy/Sell transaction negotiation

Tenant/Buyer RepresentationCurrent situational analysis and strategic planningMarket analysis and alternative identificationGIS Services analytical and demographic servicesGIS Services, analytical and demographic servicesSite Location SelectionSite tours: Attendance of all prospect toursMunicipal incentives identification and negotiationsComparative property, infrastructure and financial analysisTransaction negotiationServices delivery from first contact to move-inComplete Tenant Relocation ServicesLease Negotiationg

An AMO® Company

Retailers have unique needsNAI ReStore

NAI ReStore is designed to provide leading retailers, franchisors and franchiseeswith access to best-in-class global site selection and market analysis, tenantrepresentation, acquisition/disposition, property management and other retail realestate advisory services. This vital service offering enables chain stores toprudently and profitability manage, optimize and expand their retail real estatenetwork on a local, nationwide and/or global basis.

NAI ReStore can help retailers, franchisors and franchisees with the followingservices:

Global Market Analytics: We use a holistic approach to help chain storesoptimize their store and distribution networks. This includes analysis of detailedgeo-demographic data, customers and competitors, all down to street levelgranularity seamlessly across 65 countries. This produces a cohesive vision tokeep the network the correct size in the right locations targeting the right peoplekeep the network the correct size, in the right locations, targeting the right peopleat the right price points.

Tenant Representation: We first utilize the “SAS” (Site Attribute Survey)developed by our global market analytics group to pinpoint site selection moreaccurately. SAS lays out the metrics and parameters historically shared by all “A”stores and translates them into acceptable ranges and site selection criteria foreach chain within each market. This enables our local Tenant RepresentationSpecialists in over 325 markets working closely together with our national andSpecialists in over 325 markets, working closely together with our national andglobal retail teams, to implement each retailer’s strategic expansion plans withgreater reliability and consistency. We also are able to help retailers cut coststhrough a process that includes market analyses, identification of alternatives,negotiation of incentives, comparative property, infrastructure and financialanalyses and lease negotiation.

New Development and Leasing: Through our locally owned offices, we knowand work closely with local officials, property owners, financial institutions,y , p p y , ,investors, merchants and strategic development partners in each community. Sowe can flexibly procure and develop first choice targeted locations- whetherleased, ground-leased, acquired or a sale-leaseback. We can also help pre-leaseproperties with synergistic co-tenants or develop the excess land separately forthat purpose.

Dispositions, Investment Sales and Sale-Leasebacks: In a retail dispositionindustry filled with middlemen who may take on assignments only to farm outmuch of the heavy lifting to local brokers like ours, we can take on theseassignments directly, and pass on more savings to you. To unlock some or all ofthe value in any your retail properties, our incredible technology and local andglobal infrastructure mean we can bring your dispositions to the attention ofinterested merchants and investors worldwide.

International: We offer the most comprehensive market coverage of any globalreal estate services provider. NAI offices are owned and staffed by local expertswith deep roots and strong ties to the local community people who understandwith deep roots and strong ties to the local community – people who understandthe local market dynamics and know how to get things done. Combine this marketknowledge with our geo-demographic analytic studies of 65 countries and we canhelp franchisors and franchisees successfully penetrate any international marketwith pinpoint accuracy.

An AMO® Company

Emergency ResponseParticipationp

Property managers and maintenance personnel are on call 24 hours a day torespond to tenant emergency situations.

One phone number serves for repair requests, daytime emergencies andnighttime emergencies. Calls are answered during the day by a property managerassistant. Nighttime emergency calls are automatically routed to the cell phonenumber of our on call person. We strive to have all of our calls answered 24 hoursa day by a real live person.

In the case of a building or area emergency, NAI Chase Commercial haspartnered via Angus™ Systems with MIR3™ Intelligent Notifications to provide themost advanced emergency notification system available. This system is the sameused by major universities and key government agencies for notification ofemergency situations. MIR3’s Intelligent Notifications not only get the messagesdelivered but also allows recipients to respond providing real time updates to anddelivered, but also allows recipients to respond, providing real-time updates to andfrom a variety of modalities, including mobile phone, land line, PDA, email, pager,TTY, fax, text messages (SMS) and other devices. Notifications of emergencysituations are sent to key contact individuals of each tenant.

An AMO® Company

Facilities ManagementPreventative Maintenance & Tenant Services RequestsTenant Services Requests

Maintaining the property in excellent condition is paramount to the long termviability of the property. Proper maintenance has profound effects on the ability toattract new tenants, tenant retention and lender satisfaction.

Preventative MaintenanceA determination of preventative maintenance needs is made by our director ofp ymaintenance and reviewed by the property manager. Once these needs aredetermined, a list of preventative maintenance tasks is compiled and assigned afrequency of occurrence. This information is entered into our web basedpreventative maintenance system. PM tickets are generated by the system andemailed to the smart phones of our maintenance personnel or contractors. Eachitem has a specific time frame in which to be completed. Our system flags andreports items that have not been completed and sends an escalation email to boththe maintenance supervisor and property manager.

Tenant Service RequestsTenant Service Requests (TSR) play an important role in tenant retention. Thusan effective and responsive system is required. Tenants call a single number formaintenance requests or repairs. Tenant service requests are entered into ourweb based TSR system. The system emails the service request to the propermaintenance person or contractor’s smart phone. The TSR has a priorityassigned to it which dictates the time frame in which it is to be completed. Items

t l t d ithi th ll tt d ti l t d i il t th di t fnot completed within the allotted time are escalated via email to the director ofmaintenance and the property manager.

Most importantly, the landlord should not incur the cost for work that is thetenant’s responsibility to complete. The repair responsibilities dictated by thelease are abstracted for on-screen viewing when the tenant calls with a servicerequest. If the item is not the landlord’s responsibility, we can immediatelydiscuss the repair with the tenant and guide them to the proper solution.

ReportingDaily reports of the Tenant Service Repair requests are emailed to the director ofmaintenance, the property manager and senior management.

Our monthly standard reporting package includes:Requests for Tenant Services and Repairs

Summary of requests for the monthTrend analysis 15 month graph by categoryTrend analysis – 15 month graph by categoryResponse time

Monthly Preventative Maintenance completed/open items report.

An AMO® Company

Tenant Relations &Problem Resolution

Communication is a key element of building and maintaining a collaborativerelationship with tenants. We continually solicit feedback from tenants via oneon one conversations between the property manager and the tenantrepresentative, call confirmation of satisfaction for EVERY tenant repairrequest, surveys for random individual tenant repair requests, and entiretenant population surveys. The information gathered provides a basis ofunderstanding and trust between the property manager and the tenant.Property managers at NAI Chase Commercial understand the key to problemresolution is quick and accurate responses to tenants.

An AMO® Company

Lease Administration &Enforcement

Lease AdministrationLease administration require accurate and organized records to ensure all leaseare properly documented. Lease files are established with the lease and relatingcorrespondence for each site to provide easy access to a full set of information.A complete lease abstract of ALL important dates and rental amounts for theENTIRE term of the lease are entered into CenterSoft™ immediately after theENTIRE term of the lease are entered into CenterSoft immediately after thelease is executed. This ensures, over the term of the lease, notification andoption dates are met, rental increases implemented, pass through andreconciliation billings are accurate and timely, and any and all date sensitiveinformation is handled in a timely manner. As issues arise, our tenant contactmanagement systems and on line lease and correspondence filing provide readyaccess to information to be sure all parties are properly abiding by the leaseagreements.

Lease EnforcementLease administration controls ensure accurate lease abstracting, record keeping,and accounting. The administration process monitors compliance with the termsand conditions of each individual lease. If the lease terms are not being met, thenthe enforcement provisions identified within the lease or by law are enacted inaccordance with client direction. As a general rule, NAI Chase Commercial takesa strict approach to enforcing the terms of a lease and expects to be held toequally high standards in fulfilling the landlord’s responsibilities thereunder.q y g g p

An AMO® Company

ContractAdministrationVendor and Contractor LiaisonBeing a third-party management company, the liaison role is typical for NAIChase Commercial. Coordinating vendors, controlling the bid process andsupervising construction and maintenance companies is the routine for us.Because the scope of work performed by NAI Chase Commercial, new biddersand favorable pricing may be introduced as a result of increased volume. Thep g ylarge portfolio currently managed by NAI Chase Commercial allows the companyto have significant pull with vendors and contractors who are very interested insecuring and maintaining contracts with the company.

ComplianceContract compliance is measured through regular and frequent inspections ofthe products and services provided. The inspections allow a comparisonbetween the agreed term and conditions of the contract, and corrective action istaken as needed for the contractor or vendor to improve service.

Service and Equipment ContractsService and equipment contracts are often technical and must be in compliancewith a manufacturer’s specifications. Working from experience, with vendors orwith specialized consultants, a scope of service is identified and bids aresolicited from qualified contractors. Bid approval is sought based upon thepayback analysis if one has been performed for the equipment, or by identifyingthe relative strengths and weaknesses of particular responses to the bidprocess. Naturally cost is a factor, but the ability to properly perform is evenmore critical. So while the low bid is sought, it is not necessarily the bidrecommended. Notably, all contracts are rebid every two years prior to theannual budget preparation.

Maintenance, Housekeeping and SecurityProperly accessing the quality requirements along with the financial expectationsallows for the establishment of a proper scope of work. Monitoring compliancerequires both formal and unannounced inspections and making modifications toprocedures or performance as required. Periodic coordination meetings are heldon a predetermined frequency; weekly for high requirements, every 2 weeks formedium requirements and monthly for low requirements.

Specialized Service and Property ModificationSpecialized services require a clear understanding of the issues beingaddressed. While the management team experience typically allows evenspecialized services to be contracted without outside assistance, there areoccasions when a specialized consultant will be retained to ensure the workscope and compliance are in order. Examples may include operational issuessuch as evaluating the scope and compliance with elevator maintenancecontracts, or major capital improvements such as roofing a large structure orcleaning historically significant architectural details.

An AMO® Company

Subcontracted ServicesThe specific services required vary depending upon the particular facility andits use. In general terms, NAI Chase Commercial will supervise the followingcategories of work but the work tasks will be subcontracted.

Building MaintenanceBuilding MaintenanceRepairsPreventative MaintenanceSnow RemovalLandscapingJanitorialParking Lot Sweeping

Mechanical MaintenanceMechanical MaintenanceHVACPlumbingElectricalElevator

Capital Improvement ProjectsTenant ImprovementsSpace PlanningSpace PlanningBuilding improvements

Building SystemsGuard ServiceFire PanelCamera SystemsAccess and Alarm Systems

Reviewing Existing Service ContractsA cursory review of the contracts is necessary to set up our tracking systems,but a more in depth review is needed to understand the merits of the contract.A proper review requires an understanding of the terms and conditions of eachagreement, and evaluation of related work, a discussion with the contractor,and potentially redefining the scope of work and rebidding.

Determine Local and National Qualified Service ProvidersDetermine Local and National Qualified Service ProvidersDue to the large volume of development, construction and propertymanagement work conducted by NAI Chase Commercial, it is easy to locatequalified service providers for most any project. When selecting a serviceprovider, it is important to know the provider’s capabilities in the market.National service providers may enjoy a fine national reputation, but if the localdivision is lacking or under qualified, then the national affiliation is of little value.

NAI Chase Commercial will establish specific criteria for contractorpqualification. Based on the criteria, a list of qualified contractors will beestablished from current vendors and others who provide service to NAI ChaseCommercial.

An AMO® Company

Competitively Bid Service ContractsNAI Chase commercial is actively involved in contracts with Federal and Stategovernments and as such has a requirement to take multiple bids for projects.Our standard operating practice has always been to take multiple bids forprojects, and meet all applicable laws and regulations.

Proposal requests will be prepared in accordance with the standard proceduresfollowed by NAI Chase Commercial. Typically small jobs are not reduced toformal RPF formatting, but the scope of work is sent to interested and qualifiedcontractors. Bids are evaluated on merit when received. More formal RFP’s arecreated for large jobs with a detailed work-scope, and timeline. In the case ofmajor work of a highly technical nature, a specialized consultant may be retainedto review the project and prepare the RPF under the guidance of NAI ChaseCommercialCommercial.

Negotiation of Service ContractsService contracts are negotiated to obtain the most favorable terms. Dependingon the size and type of contract, a RFP may be prepared and distributed toqualified bidders. Once the RPF is received, additional steps are taken to ensurethe contractor understands the expectations and agrees to the conditions of theRFP. Modifications are discussed if necessary to explore methods of obtainingdesired results in a more efficient method The final contract is executed and thedesired results in a more efficient method. The final contract is executed and thework commences.

Vendor Insurance ComplianceIn order for a vendor to commence work, a contract is executed and a certificateof insurance for public liability and workman’s compensation is required withtypical limitations of liability are $1,000,000/$2,000,000 respectively. Compliancewith this procedure is tracked via our web based system including automaticverification of insurance certificate compliance The web based system allowsverification of insurance certificate compliance. The web based system allowsfield personal, via smart phones, to readily identify approved contractors for eachproperty.

An AMO® Company

FinancialAdministrationBudget Preparation and TrackingAn initial budget review will occur in order to become familiar with the currentperformance expectations. Revisions will be recommended as the managementplan develops, but the revisions generally are tracked as variance items and donot recast the budget.

The budget process typically runs on a calendar year, but can easilyaccommodate a fiscal year format if required. Information is accumulatedthroughout the year and in September and October the initial draft of the nextyear’s budget is prepared. The draft incorporates detailed leasing projections,income calculations, operational expenses, a capital improvement plan and adetailed business plan for the budgeted year. The bottom line shows cash flowby month. The budget is reviewed and revised by our management team andthen submitted to ownership for comment, revision or approval by the end ofNovember

The budgeted performance is reviewed monthly and if conditions require, it isreforecast mid-year. The monthly review is reported via the budget comparisonreport which is included in the monthly financial package. This report shows theactual and budgeted income and expenses for the current month and year-to-date periods. Variances are computed for each line item and used as the basisfor the financial report narrative. While the budget is a critical to track anyvariances from the Operating Budget proper rent collection procedures expensevariances from the Operating Budget, proper rent collection procedures, expensecontrol and ongoing budget tracking are ingredients to produce minimal budgetvariances.

Collection of ArrearagesUnless directed otherwise, NAI Chase Commercial takes a very hard line oncollection. The lease term dictates the payment terms and the tenants areexpected to abide by the lease terms, just as the tenant expects NAI ChaseCommercial on behalf of the owner to abide by the lease terms Non payers willCommercial, on behalf of the owner, to abide by the lease terms. Non-payers willreceive a phone call, follow up by a letter stating late fees (if applicable), then awritten notice of delinquency. If payment is not promptly received, a notice ofdefault of the lease is sent followed by eviction proceedings. It is the rare case inwhich a tenant does not pay prior to the commencement of eviction proceedings.

Monitoring of Financial PerformanceThe monthly financial reports indicate actual performance compared to budgetedperformance A careful review of the variances allows NAI Chase Commercial toperformance. A careful review of the variances allows NAI Chase Commercial toprovide explanations and revised forecasts if necessary. Performance factorscan quickly be adjusted if the financial projections are favorable or unfavorable toexpectations.

An AMO® Company

Real Estate Tax AppealEach year NAI Chase Commercial monitors and directs real estate tax appealwork for clients. The appeal process involves analyzing each site to see if thesite market conditions changed to favor a lower taxable value. Large local orregional firms conduct the appeals on a contingency basis.

Year End ReconciliationA year-end reconciliation of operating expenses is performed for all properties inorder to recapture the cost of all allowable items as determined by eachindividual tenant lease. In order to enhance the accuracy and timeliness of thereconciliation billings, our use of CenterSoft™ accounting software fullyautomates this process by incorporating information gathered as part of thelease abstract with actual expenses incurred over the reconciliation period.Additionally as part of the reconciliation billing process all expenses areAdditionally, as part of the reconciliation billing process, all expenses arebenchmarked against comparable managed properties as well as publishedcomparable numbers via organizations such as IREM, BOMA and ICSC.

Utilities ManagementTo effectively manage and control utility costs, we track each and every utilityinvoice in our utility database. Through a relational database we associate themeter number, suite number and account number to the key billing elements ofthe particular utility meter readings and costs We print a 15 month history ofthe particular utility, meter readings and costs. We print a 15 month history ofcost and usage for each utility invoice received so the property manager canreadily determine trends or causes of concern when approving the invoice forpayment. This database also ensures that owner’s do not pay for utilities that arethe responsibility of the tenant.

Property Management Accounting SoftwareCenterSoft™ property management software handles all our our LeaseAdministration Accounts Payable Accounts Receivable and General LedgerAdministration, Accounts Payable, Accounts Receivable and General Ledger.This application incorporates a unique data structure which puts the leasedocument as the heart of the software, adapting easily to unique lease clausesand calculations. On a monthly basis, all parties receive a full accountingpackage containing our standard reports to document all financial activity of theproperty. Standard reports can be modified or supplemented to meet any specificreporting needs. Additionally, we are able to export and upload data fromCenterSoft™ to ownerships' corporate accounting software.

An AMO® Company

Sample Reporting PackageSample reports are included in the Appendix to this proposal to illustrate thestandard formats offered by the CenterSoft™ accounting system. Variancereports are designed to meet the needs of the asset manager. While theaccounting system offers a myriad of customizable reports, the following are theessential elements of our standard reporting package:essential elements of our standard reporting package:

Income and Expense ReportsRent Roll Lists each tenant or vacant suite, square feet, expiration, optionperiods, base rent, additional rents, and security deposit liability

Unit Encumbrances A list of all units itemizing encumbrances for eachspace, such as: first right of refusals and exclusives.

Tenant Ledger Shows the beginning balance, charges by type (rent, CAM,tax, insurance, late charge, reconciliation, etc) collections, check number,amount of check, application of payments against charges and endingbalance for each tenant.

Aged Receivables Report Shows the aging of any balance due listed bytenant.

Operating Income Statement and Budget Comparison Report By chartaccount, shows the actual and budgeted income and expenses for thecurrent month and year-to-date periods. Variances are computed for eachline item and used as the basis for the financial report narrative statement ofactual expense, budget and variance

Control ReportsBank Statement A copy of the bank statement for each accountBank Statement A copy of the bank statement for each account

Bank Account Reconciliation Performed to ensure the accounts are inbalance, and a copy of which is provided

Management Fee Reconciliation Provided to show management feesbilled and paid tie to the management agreement

General Ledger Detail Detailed income and expense itemization by chartaccount showing:

Income listing each line item with the type, date and amount of billings and receiptsExpenses listing each invoice paid, invoice number, vendor, description, check number and amountGL adjustments listing each with a description of the entry

An AMO® Company

Controls &Bankingg

Banking RelationshipsNAI Chase Commercial has relationships with a number of major bankinginstitutions and is able to work with specific client needs to determine the bestsolution to use for a given project

Trust AccountsTrust AccountsAll funds are held in trust accounts for the entity under contract, and no fundsare commingled. Expenses are paid from a disbursement account that isfunded by the property trust account. Debt services or any other approvedexpenses would be paid in the same manner. Surplus funds available at monthend are remitted to ownership, based on the management plan which allowsfor working balancing remaining in the property trust account.

Rent CollectionNAI Chase Commercial will aggressively market the building for lease inattempt to stabilize the asset and it value. Rent collection is a paramountconcern and a major focus of management and accounting activity. By abidingby the landlord lease responsibilities, providing proper tenant service andbuilding maintenance, NAI Chase Commercial is able to strictly enforce thetenant lease obligations.

To ensure all rents and other charges are assessed properly leases arethoroughly and carefully abstracted by the property accountant into theaccounting system and reviewed by the property manager and controller. Theaccounting abstract covers all items and events over the entire term of thelease and includes items such as: rent, rent escalations, rent abatements, passthrough expense calculation methods, percentage rent, any other type of billingcharge, sales reporting requirements, notice dates, option dates, expirationdates, first rights of refusal, and any other possible date sensitive item that maybe encountered in the lease. The accounting system has control mechanismst if h d it i bill d dd d t ti ll b thto verify each and every item is billed or addressed automatically by thesystem and at the correct time.

The accounting system generates monthly billings within the system, however,we do not send invoices to tenants unless there has been a change in thebilling amount. This process adheres to the lease, saves time, effort andpaper. The accounting system notifies the property accountant of any changesin billing amount so an invoice can be sent for that month.

CAM, tax, insurance and operating expense billings are estimated and chargedmonthly. The accounting software reconciles the monthly estimate billings tothe actual expenses on a annual basis, or shorter period if allowed by thelease. Balances due from tenants are invoiced, and both credit and debitbalances are reflected on the tenant invoice and tenant ledger.

An AMO® Company

As a general rule, rents are due on the first day of the month, late on the tenthday of the month. The collection effort begins immediately on the fifth day ofthe month with a friendly reminder phone call made by the propertybookkeeper; followed by assessment of a late fee (per the terms of the lease)with written notice thereof; followed by written notice of default and a personalvisit by the property manager and if necessary evolving into an evictionvisit by the property manager and, if necessary, evolving into an evictionproceeding. Typically, even the most marginal tenant pays after the notice ofdefault has been sent and court action is avoided. Clients are informed of allcollection issues and notified before legal action is pursued. Once a collectioneffort begins an open item is created in our tracking system. This systemgenerates a daily report enabling the property manager and senior executivesto be aware of daily collection activity.

Rents are entered into the accounting system and deposited on the dayRents are entered into the accounting system and deposited on the dayreceived. As an additional control measure, the tenant checks are scannedfor deposit and the checking account number is used by the accountingsoftware to bring the proper tenant account on screen for application ofpayment. This method increases accuracy, is fast and provides a preventivemeasure against an undisclosed assignment of a lease.

By recording and depositing rental payments daily, cash flow is maximizedand records are always up to date for accurate and efficient follow up.

Expense ControlExpense control is a key ingredient for the success of both NAI ChaseCommercial and our portfolio of managed properties. A major advantageoffered by NAI Chase Commercial is our ability to negotiate price discountsdue to our volume purchasing power

By lowering pass-through expenses, the sites become more competitive andcan demand higher rents. In addition, tenants are more prone to renew leaseson properties with lower operating expenses.

Expense control begins with realistically budgeting for the property based onownership objectives. All anticipated expenses are competitively bid on aregular basis so as to be certain we are paying the lowest prices possible forthe quality standards required.

An AMO® Company

Accounts PayablePurchase vouchers are used to ensure suppliers are qualified and hold true toquoted pricing. At the time of purchase, the assistant to the property managercreates the purchase voucher and codes the proper property and expense GLaccount. It is then approved by the property manager . Once goods are

i d th h h i d t th i i t if i i ireceived, the purchase voucher is compared to the invoice to verify pricing iscorrect, if so, it is immediately placed in the queue for payment processing.

The ownership approved operating budget governs the daily expenses of theproperty. The Maintenance Director and the Property Manager work together tokeep expenses in budget. The Property Manager executes contracts andcontrols vendor invoices in accordance with our policies and procedures.

Management ControlsManagement ControlsKey elements of management are performed by one person and closelychecked by another. Such as:

Lease abstracting: Input of lease information into the accounting system andthe tenant service requests systems are vital to the ongoing day to daymanagement of the property. Thus, the property accountant enters theaccounting information into the accounting system, which is then verified by theproperty manager The repair obligations abstract is performed by the assistantproperty manager. The repair obligations abstract is performed by the assistantto the proper manager, then checked by the property manager.

Invoice Processing: It is imperative to correctly code expenses to the correctproperty and GL account. This is done by either the assistant to the propertymanager or the property manager. This coding is verified by the propertyaccountant.

Managers Daily Report: Property managers and senior executives receive,g y p p y g ,via email, a daily report of all operational activity including notes ofconversations and emails with tenants including items such as: move in/out,repairs and accounting issues. This report gives our management team anunmatched grasp of the day to day activities for all properties.

An AMO® Company

Construction Management, Construction, & Renovation

Regional Builders, Inc. – We build relationships, by "ExceedingExpectations".

Regional Builders is a service-oriented Construction Manager/GeneralContractor providing construction and construction management supportservices. We visualize ourselves as a construction department within the NAIsystem. Working with owners and tenants to maximize design efficiency andminimize costs, we build and facilitate all aspects of construction and design,from concept to certificate of occupancy.

Regional Builders is a close and trusted affiliate of NAI Chase Commercial’s.Since 1997 we have specialized in first class renovation projects, commercialtenant improvements, and general retrofit construction for office buildings andshopping centers in North and Central Alabama With our experience and focusshopping centers in North and Central Alabama. With our experience and focus,no job is too small or too large.

Regional Builders has seen steady growth throughout the years. With animpeccable safety record, solid and trusted leadership, a thoroughunderstanding of construction, and with a reputation for being consistently ontime and on budget, Regional Builders is able to focus on not being one of thebiggest...but rather on being one of the best specialty construction firms you canhire Our goal is to be an innovative and value-driven firm constructionhire. Our goal is to be an innovative and value-driven firm constructioncompany. We pride ourselves on the ability to provide quality and timelyconstruction services for realistic costs in a safe work environment.

An AMO® Company

Build on the power of our network.™

United States Brokerage Offices

120

140

160

180

200 188

146

107

40

60

80

100

120

46

93

5648

10797

70

42

59

23

0

20

NAI CASSIDY TURLEY

CBRE COLLIERS CORFAC CRESA C&W G&E JLL NEWMARK KNIGHT FRANK

ONCOR STUDLEY

23

References

BankingMs. Penny BillingsPresidentBancorp SouthHuntsville, Alabama (256) 564-8446

TenantMr. Stephen BurridgeReal Estate FacilitiesArrow ElectronicsMelville, NY (631) 847-2000

Mr. Jay OglesbySenior Vice PresidentWells Fargo and CompanyBirmingham, Alabama (205) 414-9601

Business and InvestmentMr. Gerald C. FinnChief Executive Officer

Mr. Greg HaddenFacilities Asset ManagementTennessee Valley AuthorityKnoxville, TN (423)751-8305

OwnerMr. Gary F. FelsherPresident

NAI Global, Inc.Princeton, NJ (609) 945 4000

Mr. Randy WolfeVice PresidentNorthMarq Capital Inc.Atlanta, GA (404) 237-2456

L l d A i

es de tFGH Investments, Inc.New York, NY (212) 759-0400

Ms. Anne O’SheaManaging MemberSan Francisco Residence ClubBerkeley, CA (510) 848-0272

Legal and AccountingMr. William Sylvester, EsquirePartnerBaker Donelson Bearman Caldwell & BerkowitzBirmingham, Alabama (205) 250-8372

Mr. Gary C. HuttoP id t

State GovernmentMr. Billy BarnesReal Estate ManagerAlabama Department of RevenueMontgomery, AL (334) 353-9615

PresidentGary Hutto Management Consulting, LLCBirmingham, Alabama (205) 807-5233

An AMO® Company

ClientsPartial List

Arrow Electronics3D Research CorporationAEPCO Engineering, Inc.Aerotek, Inc. Agilent Technologies American Shingle, Inc.

General Services Admin.Gold’s Gym Hawk Enterprises, LLC H&R BlockHolliday’s Fashion IKON Business Systems

Regis Hair Salon Rite Aid Drug Stores Rolls Royce Corporation Royal Beauty Supply Schaeffer Eye Care Center Science Application

Assurance Technology Corporation Avnet Corporation Avocent Corporation Bentley Systems, Inc. Batteries Plus BF Goodrich Bedz Express Boecore Incorporated

Internal Revenue Service ITT Educational Services Jacobs Sverdrup Corporation Jason’s Deli Johns Hopkins University Johnson Controls Kelly Services, Inc. K Force Inc

International Corporation SELEX Sensors and Airborne Systems, US Sherwin Williams Sikorsky Helicopter Star Pharmacy Discount DrugsState of Alabama Department of RevenueBoecore, Incorporated

Bonefish Grill Booz Allen Hamilton Brockwell TechnologiesC.H Robinson Company CACI International CAS ITT Weapons Systems Casa Blanca Mexican

K-Force, Inc. Kentucky Fried Chicken L3 CommunicationsLanier Services Worldwide Lenscrafter’sLittle Caesar’s Pizza Lockheed Martin Mail Boxes EtcMcAlister’s Deli

Department of Revenue Stephen Gould Corporation Subway Real Estate Corp.SunGard Trust SystemsService Engineering Co.Synapse Wireless, Inc. Taco Bell TDK Corp. of America Tech USA IncCasa Blanca Mexican

Restaurant Chrysler Corporation CIBER, Inc. Chili’s Restaurant Church’s Chicken Cici’s Pizza Cingular Wireless City of Huntsville, Alabama

McAlister s Deli Mesa AssociatesMillennium Enterprises, Inc. Moog, Inc. Motorola, Inc. Movie Gallery, IncMutual of New YorkMutual of Omaha National Semiconductor

Tech USA, Inc. Tecolote Research Corp.Telcordia Technologies Teledyne Brown Engineering Tennessee Valley Authority The Aerospace Corporation The Athlete’s Foot The Boeing Company y ,

Comcast Cable CVS Drug Store Cybex Computer Corp.Defense Investigative Service DESE Research CorporationDominoes Pizza

Newk’s Deli Nothing but Noodles Operon Bio TechnologiesPalm Beach Tanning Panera Bread Factory Pratt & Whitney Military Engines Progressive Insurance

g p yThe Protective Group The Fresh MarketTitan Corporation Tuesday Morning UAW Legal Services United Space Alliance US Army Space and Missile Defense Command

Dynamics Research Corporation EADS of North America Eagle Support Services Eclipse Business ServicesEdward Jones Investments Eckerd Drug Stores Future Electronics Corp.

Publix Supermarkets Q-Tec Engineering Quantitech, Inc. Radio Shack RBC Bank Red Hat, Inc.Redstone Federal Credit Union

Wells Fargo Home MortgageVector Aerospace Verizon Wireless Wavelink, Inc. Wyle Laboratories

Alabama Photos by B.J. Ray

An AMO® Company