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APPRAISAL REPORT RESIDENCE INN BY MARRIOTT SAN DIEGO MISSION VALLEY 1865 Hotel Circle South San Diego, San Diego County, California 92108 CBRE, Inc. File No. 20-251PS-2969-6 Contract No. RED-21-05 Pari Zaker Vice President, Real Estate Development SAN DIEGO HOUSING COMMISSION 1122 Broadway, Suite 300, San Diego, California 92101 C/O Christensen & Spath, LLP www.cbre.com/valuation www.cbrehotels.com 3501 Jamboree Road, Suite 100 Newport Beach, CA 92660 T 949-725-8500 F 949-725-8545 VALUATION & ADVISORY SERVICES www.cbrehotels.com Date of Report: September 17, 2020 Pari Zaker Vice President, Real Estate Development SAN DIEGO HOUSING COMMISSION 1122 Broadway, Suite 300, San Diego, California 92101 C/O Christensen & Spath, LLP RE: Appraisal of Residence Inn by Marriott San Diego Mission Valley 1865 Hotel Circle South San Diego, San Diego County, California 92108 CBRE, Inc. File No. 20-251PS-2969-6 Contract No. RED-21-05 Dear Ms. Zaker: At your request and authorization, CBRE, Inc. has prepared an appraisal of the retrospective fair value of the referenced property. Our analysis is presented in the following appraisal report. The subject is a 192-room extended stay hotel property located at 1865 Hotel Circle South in San Diego, California. The improvements were constructed in 2003, and renovated in 2011 and 2018. In addition, a $500,000 public space remodel occurred in early 2020, which created a new bar/lounge area. The hotel is being operated as the Residence Inn by Marriott San Diego Mission Valley. The 4 and 5 story interior-corridor improvements feature one-bedroom and two- bedroom suites with private bedrooms, living areas, and kitchen. Notable project amenities include an outdoor pool and whirlpool, outdoor children’s pool, breakfast dining area, 900 square feet of meeting space, fitness center, business center, sport-court, market pantry, vending area, guest laundry, and newly renovated bar and lounge area, among others. The subject parcel measures approximately 5.07 acres. The subject entered into a franchise agreement with Marriott International, Inc. as Franchisor and RLJ San Diego-Mission Valley Hotel, LLC, as Franchisee, with the current term expiring in September 2024. The Marriott hotel chain is a recognized lodging destination with accommodations and amenities that cater to specific travelers. The Residence Inn by Marriott is a hotel brand by Marriott that was the first extended-stay hotel brand in the United States. As of July Pari Zaker September 17, 2020 Page 2 2020, there are 852 Residence Inn hotels in the United States, Canada, and Mexico, along with 266 additional hotels in the pipeline. The subject is more fully described, both legally and physically, within the enclosed report. Based on the analysis contained in the following report, the fair value of the subject is concluded as follows: MARKET VALUE CONCLUSION Appraisal Premise Interest Appraised Date of Value Value Conclusion As Is Fee Simple Estate February 25, 2020 $68,100,000 Compiled by CBRE The report, in its entirety, including all assumptions and limiting conditions, is an integral part of, and inseparable from, this letter. The effective date of the retrospective value is February 25, 2020. As of the effective date of appraisal, the hotel market was not yet feeling the effects of the COVID-19 pandemic, which began to be felt in the United States market in March 2020. As of the date of report in August 2020, the nation, region, and market area have been materially impacted by the COVID-19 pandemic, which will have a prolonged effect on macroeconomic conditions and corresponding hotel market conditions. Therefore, we note that the valuation conclusions contained herein represent the market conditions as of the effective date of appraisal, prior to the onset of the COVID-19 pandemic, and forecasts/expectations as of February 25, 2020. The following appraisal sets forth the most pertinent data gathered, the techniques employed, and the reasoning leading to the opinion of value. The analyses, opinions and conclusions were developed based on, and this report has been prepared in conformance with, the guidelines and recommendations set forth in the Uniform Standards of Professional Appraisal Practice (USPAP), and the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. The intended use and user of our report are specifically identified in our report as agreed upon in our contract for services and/or reliance language found in the report. As a condition to being granted the status of an intended user, any intended user who has not entered into a written agreement with CBRE in connection with its use of our report agrees to be bound by the terms and conditions of the agreement between CBRE and the client who ordered the report. No other use or user of the report is permitted by any other party for any other purpose. Dissemination of this report by any party to any non-intended users does not extend reliance to any such party, and CBRE will not be responsible for any unauthorized use of or reliance upon the report, its conclusions or contents (or any portion thereof). Pari Zaker September 17, 2020 Page 3 It has been a pleasure to assist you in this assignment. If you have any questions concerning the analysis, or if CBRE can be of further service, please contact us. Respectfully submitted, CBRE - VALUATION & ADVISORY SERVICES Dan Beverly, MAI Vice President California State Certification No. AG3003262 Expiration Date: August 13, 2021 Phone: (949) 809-4074 Email: [email protected] Certification Certification We certify to the best of our knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are our personal, impartial and unbiased professional analyses, opinions, and conclusions. 3. We have no present or prospective interest in or bias with respect to the property that is the subject of this report and have no personal interest in or bias with respect to the parties involved with this assignment. 4. Our engagement in this assignment was not contingent upon developing or reporting predetermined results. 5. Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 6. This appraisal assignment was not based upon a requested minimum valuation, a specific valuation, or the approval of a loan. 7. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice, as well as the requirements of the State of California. 8. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. 9. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 10. As of the date of this report, Dan Beverly, MAI has completed the continuing education program for Designated Members of the Appraisal Institute. 11. Dan Beverly, MAI has made a personal inspection of the property that is the subject of this report. 12. No one provided significant real property appraisal assistance to the persons signing this report. 13. Valuation & Advisory Services operates as an independent economic entity within CBRE, Inc. Although employees of other CBRE, Inc. divisions may be contacted as a part of our routine market research investigations, absolute client confidentiality and privacy was always maintained with regard to this assignment without conflict of interest. 14. Dan Beverly, MAI has not performed any prior appraisal services for the property that is the subject of this appraisal report within a prior 3-year period. Dan Beverly, MAI California State Certification No. AG3003262 Expiration Date: August 13, 2021 i Subject Photographs Subject Photographs Aerial View (Parcel Lines are Approximate) ii Subject Photographs Subject Entrance Typical Subject Exterior Typical Subject Exterior Typical Subject Exterior Pool and Courtyard Area Pool and Courtyard Area iii Subject Photographs Sports Court Area Courtyard Patio Area Barbecue Area Subject Entrance from Hotel Circle South Subject Frontage – Facing West Subject Frontage – Facing East iv Subject Photographs Guest Reception Area Market Pantry Guest Reception Area Back of House Office Area Gatehouse Dining Area Gatehouse Kitchen v Subject Photographs Bar and Lounge Area Common Area Restroom Back of House Laundry Area Typical Guest Room Corridor Typical Guest Bedroom Typical Guest Room Living Area vi Subject Photographs Typical Guest Room Kitchen Typical Guest Room Bedroom Typical Guest Room Living Area Typical Guest Room Restroom Typical Guest Room Living Area & Kitchen Typical Guest Room Bedroom vii Subject Photographs Typical Guest Room Bedroom Typical Guest Room Interior Typical Guest Room Interior Typical Guest Room Living Area Typical Guest Room Bedroom Roof Area viii Executive Summary Executive Summary Property Name Residence Inn by Marriott San Diego

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