Investments in Mortgage Revenue Bonds

The mortgage revenue bonds owned by the Company have been issued to provide construction and/or permanent financing for Residential Properties and commercial properties and do not include the mortgage revenue bonds issued with respect to properties owned by Consolidated VIEs at March 31, 2015 and December 31, 2014. Mortgage revenue bonds are either held directly by the Company or are held in trusts created in connection with debt financing transactions (Note 9). The Company had the following investments in mortgage revenue bonds as of dates shown:



	March 31, 2015
Description of Mortgage Revenue Bonds	Cost adjusted for pay-downs		Unrealized Gain		Unrealized Loss		Estimated Fair Value
Arbors at Hickory Ridge ⁽³⁾	$	11,569,614	$	1,239,453	$	—	$	12,809,067
Ashley Square ⁽¹⁾	5,144,000		498,269		—		5,642,269
Avistar at Chase Hill A Bond ⁽³⁾	10,000,000		1,226,837		—		11,226,837
Avistar at the Crest A Bond ⁽³⁾	9,700,000		1,054,230		—		10,754,230
Avistar at the Oaks A Bond ⁽³⁾	7,800,000		802,611		—		8,602,611
Avistar in 09 A Bond ⁽³⁾	6,735,000		787,493		—		7,522,493
Avistar on the Boulevard A Bond ⁽³⁾	16,525,000		1,795,997		—		18,320,997
Avistar on the Hills A Bond ⁽³⁾	5,389,000		554,521		—		5,943,521
Bella Vista ⁽¹⁾	6,490,000		573,067		—		7,063,067
Bridle Ridge ⁽¹⁾	7,625,000		595,665		—		8,220,665
Brookstone ⁽¹⁾	7,469,357		1,652,619		—		9,121,976
Bruton Apartments ⁽²⁾	18,145,000		1,298,819		—		19,443,819
Concord at Gulfgate A Bond ⁽²⁾	17,060,000		1,417,004		—		18,477,004
Concord at Little York A Bond ⁽²⁾	12,480,000		820,061		—		13,300,061
Concord at Williamcrest A Bond ⁽²⁾	18,020,000		1,184,094		—		19,204,094
Copper Gate Apartments ⁽³⁾	5,220,000		390,143		—		5,610,143
Cross Creek ⁽¹⁾	6,082,064		2,465,384		—		8,547,448
Decatur Angle ⁽²⁾	23,000,000		727,260		—		23,727,260
Greens Property A Bond ⁽³⁾	8,348,000		943,736		—		9,291,736
Harden Ranch A Bond ⁽³⁾	6,960,000		623,129		—		7,583,129
Lake Forest ⁽¹⁾	8,856,000		1,037,354		—		9,893,354
Live 929 Apartments ⁽²⁾	40,874,690		4,154,777		—		45,029,467
Pro Nova 2014-1 and 2014-2 ⁽²⁾	20,092,423		889,777		—		20,982,200
Ohio Properties A Bonds ⁽¹⁾	14,383,000		2,328,438		—		16,711,438
Runnymede ⁽¹⁾	10,440,000		1,297,483		—		11,737,483
Southpark ⁽¹⁾	11,861,623		3,599,239		—		15,460,862
The Palms at Premier Park Apartments ⁽³⁾	20,125,232		2,005,005		—		22,130,237
The Suites on Paseo A Bond ⁽²⁾	35,450,000		2,901,583		—		38,351,583
Tyler Park Apartments A Bond ⁽³⁾	6,075,000		383,329		—		6,458,329
Westside Village Market A Bond ⁽³⁾	3,970,000		250,505		—		4,220,505
Woodlynn Village ⁽¹⁾	4,390,000		244,962		—		4,634,962
Mortgage revenue bonds held in trust	$	386,280,003	$	39,742,844	$	—	$	426,022,847

(1) Mortgage revenue bonds owned by ATAX TEBS I, LLC, Note 9

(2) Mortgage revenue bonds held by Deutsche Bank in a secured financing transaction, Note 9

(3) Mortgage revenue bonds owned by ATAX TEBS II, LLC, Note 9



	March 31, 2015
Description of Mortgage Revenue Bonds	Cost adjusted for pay-downs		Unrealized Gain		Unrealized Loss			Estimated Fair Value
Avistar at Chase Hill B Bond	$	965,000	$	88,486	$	—		$	1,053,486
Avistar at the Crest B Bond	759,000		69,600		—			828,600
Avistar at the Oaks B Bond	554,000		50,841		—			604,841
Avistar in 09 B Bond	457,000		41,939		—			498,939
Avistar on the Boulevard B Bond	451,000		41,357		—			492,357
Concord at Gulfgate B Bond	2,125,000		592,323		—			2,717,323
Concord at Little York B Bond	960,000		252,586		—			1,212,586
Concord at Williamcrest B Bond	2,800,000		736,708		—			3,536,708
Glenview Apartments	6,723,000		132,286		—			6,855,286
Greens Property B Bond	945,059		249,820		—			1,194,879
Harden Ranch B Bond	2,340,000		—		(2,176		)	2,337,824
Heritage Square	11,705,000		295,073		—			12,000,073
Montclair Apartments	3,458,000		148,478		—			3,606,478
Ohio Properties B Bonds	3,570,720		644,819		—			4,215,539
Renaissance	12,675,000		762,823		—			13,437,823
Santa Fe Apartments	4,736,000		120,631		—			4,856,631
The Suites on Paseo B Bond	5,500,000		—		—			5,500,000
Tyler Park B Bond	2,025,000		—		(8,991		)	2,016,009
Vantage at Harlingen	6,692,000		260,386		—			6,952,386
Vantage at Judson	6,049,000		485,432		—			6,534,432
Westside Village B Bond	1,430,000		—		(6,349		)	1,423,651
Mortgage revenue bonds	$	76,919,779	$	4,973,588	$	(17,516	)	$	81,875,851



	December 31, 2014
Description of Mortgage Revenue Bonds	Cost adjusted for pay-downs		Unrealized Gains		Unrealized Loss		Estimated Fair Value
Arbors at Hickory Ridge ⁽³⁾	$	11,570,933	$	1,792,303	$	—	$	13,363,236
Ashley Square ⁽¹⁾	5,159,000		486,559		—		5,645,559
Avistar at Chase Hill A Bond ⁽³⁾	10,000,000		1,196,800		—		11,196,800
Avistar at the Crest A Bond ⁽³⁾	9,700,000		1,419,692		—		11,119,692
Avistar at the Oaks A Bond⁽³⁾	7,800,000		869,622		—		8,669,622
Avistar in 09 A Bond ⁽³⁾	6,735,000		750,885		—		7,485,885
Avistar on the Boulevard A Bond ⁽³⁾	16,525,000		2,418,599		—		18,943,599
Avistar on the Hills A Bond ⁽³⁾	5,389,000		743,520		—		6,132,520
Bella Vista ⁽¹⁾	6,490,000		625,571		—		7,115,571
Bridle Ridge ⁽¹⁾	7,655,000		659,249		—		8,314,249
Brookstone ⁽¹⁾	7,468,888		1,360,589		—		8,829,477
Bruton Apartments ⁽²⁾	18,145,000		1,455,955		—		19,600,955
Copper Gate Apartments ⁽³⁾	5,220,000		563,656		—		5,783,656
Cross Creek ⁽¹⁾	6,074,817		2,542,262		—		8,617,079
Decatur Angle ⁽²⁾	23,000,000		919,540		—		23,919,540
Greens Property A Bond ⁽³⁾	8,366,000		1,005,119		—		9,371,119
Harden Ranch A Bond ⁽³⁾	6,960,000		511,421		—		7,471,421
Lake Forest ⁽¹⁾	8,886,000		1,003,614		—		9,889,614
Live 929 Apartments ⁽²⁾	40,895,739		3,797,745		—		44,693,484
Pro Nova 2014-1 and 2014-2 ⁽²⁾	20,095,169		1,043,431		—		21,138,600
Ohio Properties A Bonds ⁽¹⁾	14,407,000		2,444,034		—		16,851,034
Runnymede ⁽¹⁾	10,440,000		1,385,910		—		11,825,910
Southpark ⁽¹⁾	11,842,206		3,743,692		—		15,585,898
The Palms at Premier Park Apartments ⁽³⁾	20,152,000		2,680,619		—		22,832,619
The Suites on Paseo ⁽²⁾	35,450,000		3,193,691		—		38,643,691
Tyler Park Apartments A Bond ⁽³⁾	6,075,000		345,060		—		6,420,060
Westside Village Market A Bond ⁽³⁾	3,970,000		225,496		—		4,195,496
Woodlynn Village ⁽¹⁾	4,390,000		376,706		—		4,766,706
Mortgage revenue bonds held in trust	$	338,861,752	$	39,561,340	$	—	$	378,423,092

(1) Mortgage revenue bonds owned by ATAX TEBS I, LLC, Note 9

(2) Mortgage revenue bonds held by Deutsche Bank in a secured financing transaction, Note 9

(3) Mortgage revenue bonds owned by ATAX TEBS II, LLC, Note 9



	December 31, 2014
Description of Mortgage Revenue Bonds	Cost adjusted for pay-downs		Unrealized Gain		Unrealized Loss			Estimated Fair Value
Avistar at Chase Hill B Bond	$	965,000	$	144,769	$	—		$	1,109,769
Avistar at the Crest B Bond	759,000		124,286		—			883,286
Avistar at the Oaks B Bond	554,000		54,325		—			608,325
Avistar in 09 B Bond	457,000		50,608		—			507,608
Avistar on the Boulevard B Bond	451,000		73,851		—			524,851
Greens Property B Bond	945,638		376,203		—			1,321,841
Glenview Apartments	6,723,000		—		—			6,723,000
Harden Ranch B Bond	2,340,000		—		(1,501		)	2,338,499
Heritage Square	11,705,000		1,109,125		—			12,814,125
Montclair Apartments	3,458,000		—		—			3,458,000
Ohio Properties B Bonds	3,573,430		668,542		—			4,241,972
Renaissance	12,675,000		1,055,807		—			13,730,807
Santa Fe Apartments	4,736,000		—		—			4,736,000
Tyler Park Apartments B Bond	2,025,000		—		(17,395		)	2,007,605
Vantage at Harlingen	6,692,000		707,813		—			7,399,813
Vantage at Judson	6,049,000		717,230		—			6,766,230
Westside Village Market B Bond	1,430,000		—		(686		)	1,429,314
Mortgage revenue bonds	$	65,538,068	$	5,082,559	$	(19,582	)	$	70,601,045

In March 2015, the Partnership acquired the approximate $35.6 million B bond related to The Suites on Paseo at a fair market value of $5.5 million.

In January 2015, the Partnership acquired six mortgage revenue bonds. They are as follows:


•	The Partnership purchased approximately $17.1 million par value Series 2015A and approximately $2.1 million par value of Series 2015B mortgage revenue bonds. These mortgage revenue bonds are secured by Concord at Gulfgate Apartments, a 288 unit multifamily residential property located in Houston, Texas.


•	The Partnership purchased approximately $12.5 million par value Series 2015A and approximately $1.0 million par value of Series 2015B mortgage revenue bonds. These mortgage revenue bonds are secured by Concord at Little York Apartments, a 276 unit multifamily residential property located in Houston, Texas.


•	The Partnership purchased approximately $18.0 million par value Series 2015A and approximately $2.8 million par value of Series 2015B mortgage revenue bonds. These mortgage revenue bonds are secured by Concord at Williamcrest Apartments, a 288 unit multifamily residential property located in Houston, Texas.

These three Series A mortgage revenue bonds each carry an annual interest rate of 6.0% and mature on February 1, 2032. The three Series B mortgage revenue bonds each carry an annual interest rate of 12.0% and mature on March 1, 2032. In February 2015, the Partnership borrowed approximately $33.3 million under three Tender Option Bond (“TOB”) Trusts under the existing TOB structure securitizing these mortgage revenue bonds (Note 9).

The properties securing the Company’s mortgage revenue bonds are geographically dispersed throughout the United States with significant concentrations in California and Texas. As of March 31, 2015 and December 31, 2014, the concentration in California, as a percentage of principal outstanding, was approximately 19% and 18%, respectively. As of March 31, 2015 and December 31, 2014, the concentration in Texas, as a percentage of principal outstanding, was approximately 45% and 38%, respectively.

Valuation - As all of the Company’s investments in mortgage revenue bonds are classified as available-for-sale securities, they are carried on the balance sheet at their estimated fair values. As of March 31, 2015, the weighted average base rate of the mortgage revenue bonds reported in the condensed consolidated financial statements was approximately 6.0% per annum. Due to the limited market for the mortgage revenue bonds, these estimates of fair value do not necessarily represent what the Company would actually receive in a sale of the mortgage revenue bonds. There is no active trading market for the mortgage revenue bonds and price quotes for the mortgage revenue bonds are not generally available. As of March 31, 2015, all of the Company’s mortgage revenue bonds were valued using discounted cash flow and yield to maturity analyses performed by management. Management’s valuation encompasses judgment in its application. The key assumption in management’s yield to maturity analysis is the range of effective yields on the individual mortgage revenue bonds. The effective yield analysis for each mortgage revenue bond considers the current market yield on similar mortgage revenue bonds as well as the debt service coverage ratio of each underlying property serving as collateral for the mortgage revenue bond. At March 31, 2015, the range of effective yields on the individual mortgage revenue bonds was 4.8% to 9.6% per annum. At December 31, 2014, the range of effective yields on the individual mortgage revenue bonds was 4.7% to 8.3% per annum. Additionally, the Company calculated the sensitivity of the key assumption used in calculating the fair values of these mortgage revenue bonds. Assuming a 10% adverse change in the key assumption, the effective yields on the individual mortgage revenue bonds would increase to a range of 5.2% to 10.5% per annum and would result in additional unrealized losses on the mortgage revenue bond portfolio of approximately $32.6 million. This sensitivity analysis is hypothetical and is as of a specific point in time. The results of the sensitivity analysis may not be indicative of actual changes in fair value and should be used with caution. If available, the general partner may also consider price quotes on similar mortgage revenue bonds or other information from external sources, such as pricing services. Pricing services, broker quotes and management’s analyses provide indicative pricing only.

Unrealized gains or losses on these mortgage revenue bonds are recorded in accumulated other comprehensive income (loss) to reflect changes in their estimated fair values resulting from market conditions and fluctuations in the present value of the expected cash flows from the underlying properties. As of March 31, 2015, Harden Ranch B, Tyler Park Apartments B, and Westside Village Market B mortgage revenue bond investments have been in unrealized loss positions for greater than twelve months.