Real Estate Assets

MF Properties

To facilitate its investment strategy of acquiring additional tax-exempt mortgage revenue bonds secured by MF Properties, the Company has acquired through its various subsidiaries 99% limited partner positions in three limited partnerships and 100% member positions in four limited liability companies that own the MF Properties. The financial statements of these properties are consolidated with those of the Company. The general partners of these partnerships are unaffiliated parties and their 1% ownership interest in these limited partnerships is reflected in the Company’s consolidated financial statements as noncontrolling interests. The Company expects each of these MF Properties to eventually be sold either to a not-for-profit entity or in connection with a syndication of LIHTCs. The Company expects to purchase tax-exempt mortgage revenue bonds issued by the new property owners as part of the restructuring.

Recent Transactions

In August 2012, the Company closed on the purchase of the Maples on 97^th property, a 258 unit facility located in Omaha, Nebraska, for a purchase price of approximately $5.5 million through the execution of a Qualified Exchange Accommodation Agreement that assigned the right to acquire and own the Maples on 97^th property to a wholly-owned subsidiary of a Title Company, (EAT (Maples on 97th)), for a period not to exceed six months. The Company lent the EAT (Maples on 97th) the necessary funds to purchase the replacement property; there was no other capital within that entity. The EAT (Maples on 97th) then executed a Master Lease Agreement and Construction Management Agreement with the Company. These two agreements gave the Company the rights and obligations to manage the replacement property as well as the rehabilitation during the six month hold period. During this six month holding period, the Partnership completed the majority of the rehabilitation of the property. At December 31, 2012 the EAT (Maples on 97th) was reported as a VIE. In February 2013, title to the Maples on 97th property transferred to the Partnership from the EAT (Maples on 97th) and the property is reported as an MF Property as of March 31, 2013.

In March 2013, a wholly-owned subsidiary of the Company executed a 35-year ground lease with the University of Nebraska - Lincoln (“Lessor”) with an annual lease payment of $100. The leased property will have a mixed-use development consisting of a 1,605 stall parking garage and 475 bed student housing complex constructed on it. The Lessor will own the parking garage for which it will contribute approximately $16.7 million to its construction. The Company will own the student housing and currently estimates that construction will cost approximately $34.0 million. The Company has executed a guaranteed maximum price contract with the general contractor for the construction on the mixed-use development. The Company expects to restructure its ownership of the student housing development into a tax-exempt mortgage bond holding after the construction is completed (which is estimated as August 1, 2014 and the project has a sufficient history of operating results. The Company has secured approximately $29.8 million in financing facilities to cover the majority of the construction costs (Note 16).

The Company had the following investments in MF Properties as of March 31, 2013 and December 31, 2012:



MF Properties
Property Name	Location	Number of Units	Land		Buildings and Improvements		Carrying Value at March 31, 2013
Arboretum	Omaha, NE	145	$	1,720,740	$	19,025,725	$	20,746,465
Eagle Village	Evansville, IN	511	564,726		12,283,270		12,847,996
Glynn Place	Brunswick, GA	128	743,996		4,770,776		5,514,772
Maples on 97th	Omaha, NE	258	905,000		7,258,372		8,163,372
Meadowview	Highland Heights, KY	118	688,539		5,221,301		5,909,840
Residences of DeCordova	Granbury, TX	110	680,852		8,391,701		9,072,553
Residences of Weatherford	Weatherford, TX	76	533,000		7,078,220		7,611,220
Construction work in process	Lincoln, NE	N/A	—		2,119,944		2,119,945
							71,986,163
Less accumulated depreciation (depreciation expense of approximately $849,000 in 2013)							(6,450,506		)
Balance at March 31, 2013							$	65,535,657



MF Properties
Property Name	Location	Number of Units	Land		Buildings and Improvements		Carrying Value at December 31, 2012
Arboretum	Omaha, NE	145	$	1,720,740	$	18,997,550	$	20,718,290
Eagle Village	Evansville, IN	511	564,726		12,277,210		12,841,936
Glynn Place	Brunswick, GA	128	743,996		4,750,267		5,494,263
Meadowview	Highland Heights, KY	118	688,539		5,214,306		5,902,845
Residences of DeCordova	Granbury, TX	110	680,852		8,389,721		9,070,573
Residences of Weatherford	Weatherford, TX	76	533,000		7,077,420		7,610,420
Construction work in process	Lincoln, NE	N/A	—		936,833		936,833
							62,575,160
Less accumulated depreciation (depreciation expense of approximately $2.5 million in 2012)							(5,458,961		)
Balance at December 31, 2012							$	57,116,199

Acquisition

The Maples on 97th property acquisition is disclosed pursuant to the accounting guidance on business combinations. A condensed balance sheet at the date of acquisition is included below.



	Maples on 97th 8/29/2012 (Date of Acquisition)
Other current assets	$	44,534
In-place lease assets	428,865
Real estate assets	5,071,135
Total Assets	$	5,544,534
Accounts payable, accrued expenses and other	$	69,120
Net assets	5,475,414
Total liabilities and net assets	$	5,544,534

The table below shows the pro forma condensed consolidated results of operations of the Company as if Maples on 97th had been acquired at the beginning of the periods presented:



	For Three Months Ended March 31, 2013		For Three Months Ended March 31, 2012

Revenues	$	13,394,714	$	5,785,809
Net income	8,355,688		650,547
Net income allocated to unitholders	8,084,553		881,502
Unitholders' interest in net income per unit (basic and diluted)	$	0.19	$	0.03

Consolidated VIE Properties

In addition to the MF Properties, the Company consolidates the assets, liabilities and results of operations of the Consolidated VIEs in accordance with the accounting guidance on consolidations. Although the assets of these VIEs are consolidated, the Company has no ownership interest in the VIEs other than to the extent they serve as collateral for the tax-exempt mortgage revenue bonds owned by the Partnership. The results of operations of those properties are recorded by the Company in consolidation but any net income or loss from these properties does not accrue to the unitholders or the general partner, but is instead included in "Unallocated deficit of Consolidated VIEs.”

The Company consolidated the following properties owned by Consolidated VIEs in continuing operations as of March 31, 2013 and December 31, 2012:



Consolidated VIEs
Property Name	Location	Number of Units	Land		Buildings and Improvements		Carrying Value at March 31, 2013
Bent Tree Apartments	Columbia, SC	232	$	986,000	$	11,903,493	$	12,889,493
Fairmont Oaks Apartments	Gainsville, FL	178	850,400		8,731,346		9,581,746
Lake Forest Apartments	Daytona Beach, FL	240	1,396,800		11,371,823		12,768,623
							35,239,862
Less accumulated depreciation (depreciation expense of approximately $345,000 in 2013)							(14,068,730		)
Balance at March 31, 2013							$	21,171,132
Consolidated VIEs
Property Name	Location	Number of Units	Land		Buildings and Improvements		Carrying Value at December 31, 2012
Bent Tree Apartments	Columbia, SC	232	$	986,000	$	11,877,333	$	12,863,333
Fairmont Oaks Apartments	Gainsville, FL	178	850,400		8,713,038		9,563,438
Lake Forest Apartments	Daytona Beach, FL	240	1,396,800		11,352,854		12,749,654
Maples on 97th	Omaha, NE	258	905,000		6,161,770		7,066,770
							42,243,195
Less accumulated depreciation (depreciation expense of approximately $1.5 million in 2012)							(13,871,102		)
Balance at December 31, 2012							$	28,372,093