Florida Housing Finance Corporation

EXHIBIT E Page 1 of 42

Florida Housing Finance Corporation

Credit Underwriting Report

Centerra 2015-106B / RFA 2015-110 (2016-104H) Multifamily Mortgage Revenue Bonds, HOME Investment Partnership Loan, and 4% Non-Competitive Housing Credits Program

Section A: Report Summary Section B: Multifamily Mortgage Revenue Bonds Program and HOME Loan Special and General Conditions and Housing Credit Allocation Recommendation and Contingencies

Section C: Supporting Information and Schedules

Prepared by AmeriNational Community Services, LLC d/b/a AmeriNat in KY, GA, and FL

Final Report June 15, 2016

MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

Centerra

TABLE OF CONTENTS

Section A

Report Summary

Recommendation Overview Uses of Funds Operating Pro forma

Section B

MMRB and HOME Loan Special and General Closing Conditions Housing Credit Allocation Recommedation and Contingencies

Section C

Supporting Information and Schedules

Additional Development & Third Party Information Borrower Information Guarantor Information Syndicator Information General Contractor Information Property Management Information

Exhibits

15 Year Pro forma Description of Features and Amenity Characteristics - MMRB Description of Features and Amenity Characteristics - HOME HC Allocation Calculation Completeness and Issues Checklist

EXHIBIT E Page 2 of 42

AMERINAT

Page A1-A9 A10-A14 A15-A19 A20-A22

B1-B6 B7

C1-C5 C6-C9 C10-C12

C13 C14 C15

1 2 1 2 2-4 3 1-2 4 1-2

June 15, 2016

MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

EXHIBIT E Page 3 of 42

AMERINAT

Section A Report Summary

June 15, 2016

MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

Recommendation

EXHIBIT E Page 4 of 42

AMERINAT

AmeriNational Community Services, LLC d/b/a AmeriNat in KY, GA, and FL ("AmeriNat") recommends the issuance of Multifamily Mortgage Revenue Bonds ("MMRB") in the amount of $14,500,000, a HOME Investment Partnership Loan ("HOME") in the amount of $5,304,000 under Request for Applications 2015- 110 for Financing of Affordable Multifamily Housing Developments with HOME funding to be used in Conjunction with Florida Housing-Issued Multifamily Mortgage Revenue Bond Financing and Non- Competitive Housing Credits ("RFA") and an annual 4% Housing Credit ("HC") allocation of $1,004,859 to Centerra Associates, Ltd. ("Applicant") for the construction and permanent phase financing of Centerra (the proposed "Development").

Development Name: Centerra

DEVELOPMENT & SET-ASIDES

Program Numbers:

2015-106B

RFA 2015-110

2016-104H

Address: 18000 SW 107th Avenue

City: Miami

Zip Code: 33157

County: Miami-Dade

County Size: Large

Development Category: New Construction

Development Type:

Townhouses

Presumed to be concrete block construction with wood trusses, standard shingles and stucco Construction Type: exterior. Plan and Cost Review will confirm construction type.

Demographic Commitment:

Elderly:

Farmworker or Commercial Fish Worker:

Homeless:

ELI: 0 Units @

AMI

Family: X Link:

Units

Bed Bath Rooms Rooms Units

2.0 2.0

6

2.0 2.0 43

2.0 2.0

3

3.0 2.0

5

3.0 2.0 44

3.0 2.0 3

104

Square

Gross HC

Feet AMI% Rent

1238 50% $798

1238 60% $958

1238

1422 1422

50% $923 60% $1,107

1422

138320

Low HOME Rents $798

$923

High HOME Rents

$1,083

$1,243

RD/HUD Utility Cont Net HC Applicant Allow Rents Rent Rents

$127

$671 $671

$127

$831 $831

$1,295

$177

$746 $746

$177

$930 $930

$1,420

Appraiser Rents $671 $831 $1,500 $746 $930 $1,750

CU Rents $671 $831 $1,500 $746 $930 $1,750

Annual Rental Income $48,312 $428,796 $54,000 $44,760 $491,040 $63,000

$1,129,908

Buildings: Residential - 15

Parking: Parking Spaces -

273

Non-Residential - 1 Accessible Spaces -

Unknown

Set Asides:

Program MMRB

% of Units 40.0%

# of Units 42

% AMI 60%

Term (Years) 30

HOME Assissted Units

10.0%

11

50%

30

HOME Assissted Units

41.0%

43

60%

30

Housing Credits

94.0%

98

60%

30

CENTERRA

June 15, 2016

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MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

EXHIBIT E Page 5 of 42

AMERINAT

Home Subsidy Limits: 27 Two Bedroom units at $106,453 = 27 Three Bedroom units at $137,716 = 54 Total Units for a maximum subsidy of:

$2,874,231 $3,718,332 $6,592,563

Absorption Rate: 26

units per month for 4

months.

Occupancy Rate at Stabilization:

Physical Occupancy

96%

Economic Occupancy

95%

Occupancy Comments CMA occupancy was 100% per April 2016 market study

DDA?: Yes

QCT?: No

Site Acreage:

11.73

Density: 8.87 units/acre Flood Zone Designation:

X

RU-TH - Residential Townhouse District. Up to 8.5

units/acre. Development is using Severable Use Rights

Zoning: to add additional density and meet zoning code.

Flood Insurance Required?:

N/A

DEVELOPMENT TEAM

Appl i c a nt/Borrower: General Partner 1: Limited Partner 1: Gua ra ntor(s ):

Devel oper: Principal 1 Principal 2 Principal 3

General Contractor 1: Management Company: Syndi c a tor: Bond Issuer: Arc hi tec t: Market Study Provider: Appra i s er:

Centerra Associates, Ltd. Cornerstone Centerra, LLC SunTrust Community Capital, LLC Centerra Associates, Ltd. Cornerstone Centerra, LLC

Jorge and Awilda Lopez, tenants by the entireties

Leon J. Wolfe

Mara S. Mades M3 Acquisitions, LLC M.S. Mades Family Limited Partnership M.S. Mades Associates, LLC Cornerstone Group Partners, LLC Jorge and Awilda Lopez, tenants by the entireties M3 Acquisitions, LLC M.S. Mades Family Limited Partnership Brookstone Construction, LLC Cornerstone Residential Management, LLC SunTrust Community Capital, LLC Florida Housing Finance Corporation Richard Jones Architecture, Inc. Meridian Appraisal Group, Inc. Meridian Appraisal Group, Inc.

% Owners hi p 0.01% 99.99%

CENTERRA

June 15, 2016

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MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

EXHIBIT E Page 6 of 42

AMERINAT

Lien Position

Lender/Grantor

Amount Underwritten Interest Rate All In Interest Rate Loan Term Amorti za ti on Market Rate/Market Financing LTV Restricted Market Financing LTV Loan to Cost

PERMANENT FINANCING INFORMATION

1st Source 2nd Source 3rd Source 4th Source

1

2

3

FHFC / Chase

FHFC HOME

Miami-Dade PHCD

$6,700,000 $5,304,000 $2,250,000

4.99%

0.00%

0.75%

4.99% 15 35

0.00% 20 n/a

0.75% 28 n/a

30.88%

55.32%

65.69%

79.95% 23.71%

143.25% 18.77%

170.10% 7.96%

5th Source

Debt Service Coverage

1.20

1.20

1.15

Opera ti ng/Defi ci t Service Reserve

Period of Operating Expens es /Defi c i t Reserve in Months

$220,000 2.4

Other

Deferred Developer Fee Land Value Market Rent/Market Financing Stabilized Value Rent Restricted Market Financing Stablized Value Rent Restricted Favorable Financing Stablized Value Projected Net Operating Income (NOI) - Year 1 Projected Net Operating Income (NOI) - 15 Year Year 15 Pro Forma Income Escalation Rate Year 15 Pro Forma Expense Escalation Rate Bond Structure Housing Credit Syndication Price Housing Credit Annual Allocation

CONSTRUCTION/PERMANENT SOURCES:

$2,952,126 $2,940,000 $21,700,000 $8,380,000 $12,170,000

$486,642 $538,607

2% 3% Negotiated Private Sale $1.12 $1,004,859

Source

Lender

First Mortgage - MMRB FHFC / Chase

Second Mortgage - HOME FHFC

Third Mortgage -

Redeployed Surtax

Miami-Dade PHCD

HC Equity

SunTrust

Deferred Developer Fee Developer

Deferred GC Fee

General Contractor

TOTAL

Construction $14,500,000 $5,304,000

$2,100,000 $2,976,000 $2,952,126 $429,304 $28,261,430

Permanent $6,700,000 $5,304,000

$2,250,000 $10,626,000 $2,952,126

$429,304 $28,261,430

Perm Loan/Unit $64,423 $51,000

$21,635 $102,173 $28,386 $4,128 $271,745

CENTERRA

June 15, 2016

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MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

EXHIBIT E Page 7 of 42

AMERINAT

Changes from the Application:

COMPARISON CRITERIA

YES NO

Does the level of experience of the current team equal or exceed that of the team described in the Application?

1

Are all funding sources the same as shown in the Application?

X

Are all local government recommendations/contributions still in place at the level described in the Application?

X

Is the Development feasible with all amenities/features listed in the Application?

2

Do the site plans/architectural drawings account for all amenities/features listed in the Application?

3

Does the Applicant have site control at or above the level indicated in the Application? X

Does the Applicant have adequate zoning as indicated in the Application?

X

Has the Development been evaluated for feasibility using the total length of set-aside committed to in the Application?

X

Have the Development costs remained equal to or less than those listed in the Application?

4

Is the Development feasible using the set-asides committed to in the Application?

X

If the Development has committed to serve a special target group (e.g. elderly, large

family, etc.), do the development and operating plans contain specific provisions for X

implementation?

HOME ONLY: If points were given for match funds, is the match percentage the same as or greater than that indicated in the Application?

X

HC ONLY: Is the rate of syndication the same as or greater than that shown in the Application?

X

Is the Development in all other material respects the same as presented in the Application?

5

The following are explanations of each item checked "No" in the table above:

1. Since the HOME Application, the Management Agent changed from CSG Management Services, LLC to Cornerstone Residential Management, LLC. Both entities are affiliated with the Developer and have the same level of experience.

2. The Applicant has not provided a complete set of plans and specifications; therefore, AmeriNat is unable to confirm the Development is feasible with all amenities/features listed in the Application at this time.

3. The Applicant has not provided a complete set of plans and specifications; therefore, AmeriNat is unable to confirm the site plans/architectural drawings account for all amenities/features listed in the Application at this time.

4. Total Development Costs have increased from $27,813,142 to $28,261,430 for a difference of $448,288 since the Application due to increases in construction costs and land extension fees.

5. According to the bond application, the Applicant requested an issuance of MMRB in the amount of $14,000,000. Subsequently, the Applicant requested FHFC to increase the bond amount to $14,500,000 in order to satisfy the 50% test. The request was approved by FHFC on June 9, 2016.

CENTERRA

June 15, 2016

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MMRB, HOME AND HC CREDIT UNDERWRITING REPORT

EXHIBIT E Page 8 of 42

AMERINAT

Does the Development Team have any Florida Housing Financed Developments on the Past Due/Non- Compliance Report?

According to the FHFC April 1, 2016 Asset Management Non-Compliance Report, the Development Team has the following non-compliance issues:

Bonita Pointe ? Failure to document tenant eligibility upon initial occupancy. Mission Bay ? 1) Failure to meet Uniform Physical Condition Standards for units 2) Failure to

document eligibility upon initial occupancy.

According to the May 11, 2016 Florida Housing Past Due Report, the Development Team has the following past due items:

Villa Capri Phase III - TCEP - Owes $250 late fee for Failure to submit 2015 Audited Financials and SR-1 form by 5/2/2016. Failure to submit 2015 Audited Financials and SR-1 form. Late fee invoice sent out on 5/10/2016.

This recommendation is subject to satisfactory resolution, as determined by Florida Housing, of any outstanding noncompliance issues or past due items applicable to the Development Team prior to loan closing.

Strengths:

1. A Market Study performed by Meridian Appraisal Group, Inc. ("Meridian") dated April 12, 2016 concludes that the Development should benefit from the rental rate advantage it will have over market rents. Based on the proposed rents, the Development will have a rental rate advantage of between 44.7% and 55.4% for its two-bedroom units and between 42.6% and 53.1% for its three-bedroom units when compared to the achievable market rents for the area.

2. Per the Market Study completed by Meridian dated April 12, 2016, the Development has a capture rate of 0.6% in the Primary Market Area ("PMA"), a ten mile ring centered on the Development with an estimated population of 16,281 potential households that are income qualified with a propensity to rent. The capture rate indicates the Development is correctly sized relative to the amount of income-qualified renter households in the market and strong demand exists for affordable rental units.

3. Meridian identified seven properties with a total of 1,210 units as comparable to the Development that are located in the Comparable Market Area ("CMA"). The comparable properties have a weighted average physical occupancy rate of 100%.

Other Considerations:

1. The market study concludes the Development should not have an appreciable long-term negative impact on the affordable housing located within the PMA of the Development. There is a moderate case for impact on the three existing general population (Captiva Club, Caribbean West and Running Brook) projects located within two miles of the subject as the Development will be new construction; and therefore, equally or more desirable as it will reflect current market tastes. Any impact beyond the subject's lease-up would be considered long-term. Since the Miami-Dade economy and apartment market are expected to perform well over the long-term, there would be a weak case for long-term impact to all of the properties located near the subject. There are no Guarantee Fund projects located within 10 miles of the subject or in the PMA.

CENTERRA

June 15, 2016

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