Halcyon New York, New York

THE WEITZMAN GROUP, INC. Real Estate Consultants 355 Lexington Avenue  New York, NY 10017  212 949-4000  FAX# 212 949-0875

MARKETABILITY AND CASH FLOW ANALYSIS OF

HALCYON NEW YORK, NEW YORK

AS OF DECEMBER 31, 2014

Prepared For: POLAR INVESTMENTS GROUP AND ORIGO INVESTMENTS G.P.

MARCH 6, 2015

The Weitzman Group, Inc. 355 Lexington Avenue, New York, NY

Account: 048-15F

March 6, 2015

Mr. Eyal Bigon Mr. Thor Rozenberg Chief Financial Officer Chief Financial Officer Polar Investments Group Origo Investments G.P. 35 Ehad Ha’am St. 35 Ehad Ha’am St. Tel Aviv, Israel Tel Aviv, Israel

Re: Marketability and Cash Flow Analysis Halcyon Condominiums New York, New York

Dear Messrs. Bigon and Rozenberg:

Thank you for the opportunity to provide Polar and Origo with a reasonable independent forecast of cash flow after debt service resulting from the remaining construction, sellout, and closings of the residential condominiums, retail space, and residential parking and storage at the Halcyon Condominiums in the Midtown East area of Manhattan. Our research in support of this study occurred during January and February 2015, with data obtained during this time period used to validate our retrospective assumptions, although the date of our analysis is as of December 31, 2014.

This engagement does not include an appraisal or valuation of the project, and nothing herein should be construed as representing an appraisal. The purpose of the assignment is to present an independent projection of cash flows after construction debt service for use by Polar and Origo in determining prospective cash flows to the various investor positions in the project. We understand that this analysis will be reviewed by your accounting staff, and that our projections will be utilized for reference purposes in financial statements and reporting.

We have enjoyed working with you on this assignment. Please contact us if you have any questions or comments regarding this cash flow analysis or the marketability and financial assumptions from which it is derived.

Very truly yours,

THE WEITZMAN GROUP, INC.

Marilyn K. Weitzman, MAI, CRE, FRICS Peter T. Bazeli, MRICS President Senior Vice President

Ali Raza Associate

NEIGHBORHOOD AND REGIONAL LOCATION MAPS THE HALCYON

TABLE OF CONTENTS

Objectives and Tasks Completed ...... 1

Property Overview ...... 1

Construction Trends ...... 7

Condominium Market Overview ...... 11

Comparable Condominium Communities ...... 17

Retail Market Overview ...... 34

Cash Flow Projections ...... 39

Conclusion ...... 46

Addenda

Exhibit A – Basic Assumptions and Limiting Conditions Exhibit B – Certification of the Consultants Exhibit C - Qualifications of the Consultants

OBJECTIVES AND TASKS COMPLETED

The Weitzman Group was engaged to provide the client identified herein with a reasonable independent cash flow and marketability analysis of the Halcyon. In preparation of this analysis, The Weitzman Group completed the following tasks:

 Reviewed the residential and retail market fundamentals and trends in an effort to determine the overall health of the relevant markets.

 Toured the property’s residential floors and retail space, and met with the salesperson leading the sales effort for the residential component.

 Obtained numerous residential sale and retail lease comparables in relevant locations including Turtle Bay, Sutton Place, and Lenox Hill.

 Analyzed transaction data and recent availability among a group of peer condominium buildings that frame the market for prospective sales of new condominiums at the project.

 Obtained retail condominium sales transaction data, and analyzed retail sale transaction trends and reported investment rates in this asset class.

 Reviewed economic and demographic trends that provide context to the potential sellout of the project.

 Conducted a detailed monthly cash flow analysis within Microsoft Excel.

We were asked by our client to present a limited report summarizing our research findings and documentation of the market support for our conclusions and underwriting assumptions. Thus, while we have reviewed a great deal of market data related to the Halcyon project, not all of our research is summarized in this report. All of our research has been retained in our files.

PROPERTY OVERVIEW

LOCATION

The subject property is located at 305 East 51st Street, in Midtown East within the Turtle Bay neighborhood, between First and Second Avenues. Turtle Bay is located south of Lenox Hill, with Murray Hill at its southern border, Sutton Place and Beekman to its east and the corner of Midtown to its west. The area is characterized by the presence of the United Nations and is home to diplomats and other affluent residents. The neighborhood features a mix of building types, ranging from brownstones to modern residential high-rises.

Midtown East

Bordered by 42nd Street to the south and East 59th Street to the north, between Avenue of the Americas and the East River, the Midtown East neighborhood (which includes Turtle Bay) is characterized by the presence of the largest central business district in the country. Offering the convenience of living close to

work, the neighborhood has become home to several high-end residential towers, and today, comprises a diverse residential stock, from new luxury high-rise buildings to pre-war walkups. The eastern part of the neighborhood, which also includes enclaves such as Sutton Place, Tudor City and Beekman Place, comprises a number of luxury residential towers that offer expansive views of the East River. The area is also home to a number of diplomats and staff that are affiliated with the United Nations, which is located in Turtle Bay along 42nd Street.

Midtown East is home to many of New York City’s finest shopping, restaurants, and entertainment. It has excellent access to transit and will further improve with the addition of the Second Avenue Subway line. The first phase of the Second Avenue Subway line will open in December 2016. When fully completed the Second Avenue Subway line will stretch about 8.5 miles on Manhattan’s East Side from 125th Street in Harlem to Hanover Square in Downtown Manhattan. While the neighborhood is largely served by the 4,5,6 Lexington Avenue Line, the presence of Grand Central at 42nd Street and Park Avenue, provides access to the City’s main regional transportation hub, which connects multiple subway lines and the Metro North commuter railroad. While Fifth Avenue features the most prominent retail corridor in the City the neighborhood also offers small-scale retail, discreet coffee shops and dining establishments along the eastern avenues. A Whole Foods supermarket recently opened on 57th Street, between Third and Second Avenues.

Midtown East is a popular residential location for families with children, offering a relatively affordable alternative to other family-friendly neighborhoods in Manhattan, such as the Upper East and West Sides, or the West Village. The proximity to Central Park and the presence of premier schools such as Beekman School at 220 East 50th Street, are among a number of amenities that appeal to families of the neighborhood.

PROJECT SCOPE

The Halcyon is a 32-story, 123 unit building designed by New York architect S. Russell Groves and is being developed by HFZ Capital Group. The development has a limestone-clad base and a steel and glass tower facade. Units include a broad range of sizes with studios, one to four bedrooms and duplex penthouses.

The interior finishes feature 10’ ceiling heights, 6” wide plank oak floors, double-paned energy efficient windows, and solid core wood interior doors. The kitchen areas are custom designed by Varenna and have laquered cabinetry, Calacatta Gold marble countertops, a Subzero wine cooler in most units, Wolf microwave and a Miele appliance package. The bathrooms have radiant heated flooring, Kohler fixtures, and Statuary marble countertops and walls. The building includes amenities such as a library, courtyard, children’s playroom, a sky lounge, a workout studio, a 52-foot pool, and a fitness center. Furthermore, the building’s owners benefit from a 421-A tax abatement.

There were 92 units in contract at the Halcyon through December 2014. The average contract price among all units was $2.68 million, which equates to $1,755 per square foot based upon average unit size of 1,528 square feet. Among unsold units, monthly taxes are projected to average $0.84 per square foot with the 421-A tax abatement, while monthly maintenance fees average $1.00 per square foot. The following tables summarize this information.

TABLE 1 HALCYON - 305 EAST 51ST STREET SALES SUMMARY Through 12/31/2014

Total Number of Units:123 TotalContracts: 92

Unit Contract Date Type BR Type BA SF Sale Price PSF 15C 7/30/2013 1 BR 1 BA 747 $1,300,000 $1,740 11C 8/21/2013 1 BR 1 BA 747 $1,270,000 $1,700 16C 8/21/2013 1 BR 1 BA 747 $1,335,000 $1,787 10C 9/9/2013 1 BR 1 BA 747 $1,285,000 $1,720 17C 9/20/2013 1 BR 1 BA 747 $1,380,000 $1,847 12C 9/24/2013 1 BR 1 BA 747 $1,345,000 $1,801 5A 10/23/2013 1 BR 1 BA 843 $1,350,000 $1,601 4A 6/4/2014 1 BR 1 BA 843 $1,300,000 $1,542 3B 10/21/2013 1 BR 1 BA 919 $1,400,000 $1,523 14D 7/31/2013 1 BR 1 BA 953 $1,605,000 $1,684 15D 8/8/2013 1 BR 1 BA 953 $1,620,000 $1,700 16D 8/20/2013 1 BR 1 BA 953 $1,660,000 $1,742 17D 10/28/2013 1 BR 1 BA 953 $1,725,000 $1,810 18D 11/18/2013 1 BR 1 BA 953 $1,740,000 $1,826 19D 12/6/2013 1 BR 1 BA 953 $1,790,000 $1,878 11D 1/15/2014 1 BR 1 BA 953 $1,650,000 $1,731 12D 2/5/2014 1 BR 1 BA 953 $1,665,000 $1,747 10D 6/25/2014 1 BR 1 BA 953 $1,650,000 $1,731 20D 12/16/2014 1 BR 1 BA 953 $1,975,000 $2,072 23B 5/27/2014 1 BR 1 BA 986 $1,915,000 $1,942 25B 11/7/2013 1 BR 1 BA 986 $1,795,000 $1,820 24B 11/8/2013 1 BR 1 BA 986 $1,780,000 $1,805 26B 11/22/2013 1 BR 1 BA 986 $1,810,000 $1,836 27B 1/13/2014 1 BR 1 BA 986 $1,855,000 $1,881 29B 5/16/2014 1 BR 1 BA 986 $1,915,000 $1,942 5C 7/30/2013 1 BR 1 BA 1,000 $1,410,000 $1,410

TABLE 1 (Continued) 6C 8/5/2013 1 BR 1 BA 1,000 $1,420,000 $1,420 4C 1/31/2014 1 BR 1 BA 1,000 $1,565,000 $1,565 7F 5/29/2014 2 BR 2 BA 1,596 $2,420,000 $1,516 3C 8/14/2013 2 BR 2 BA 1,285 $1,950,000 $1,518 7C 8/15/2013 2 BR 2 BA 1,399 $2,275,000 $1,626 15F 8/12/2013 2 BR 2 BA 1,443 $2,475,000 $1,715 16F 8/22/2013 2 BR 2 BA 1,443 $2,500,000 $1,733 11F 9/3/2013 2 BR 2 BA 1,443 $2,415,000 $1,674 14F 9/4/2013 2 BR 2 BA 1,443 $2,455,000 $1,701 17F 9/27/2013 2 BR 2 BA 1,443 $2,585,000 $1,791 12F 2/5/2014 2 BR 2 BA 1,443 $2,490,000 $1,726 18F 2/14/2014 2 BR 2 BA 1,443 $2,710,000 $1,878 19F 5/21/2014 2 BR 2 BA 1,443 $2,815,000 $1,951 10F 5/30/2014 2 BR 2 BA 1,443 $2,450,000 $1,698 20F 6/11/2014 2 BR 2 BA 1,443 $2,840,000 $1,968 9F 5/30/2014 2 BR 2 BA 1,461 $2,375,000 $1,626 8C 1/24/2014 2 BR 2 BA 1,454 $3,000,000 $2,063 8F 5/30/2014 2 BR 2 BA 1,490 $2,400,000 $1,611 15B 8/5/2013 2 BR 2 BA 1,518 $2,475,000 $1,630 11B 8/8/2013 2 BR 2 BA 1,518 $2,415,000 $1,591 16B 8/14/2013 2 BR 2 BA 1,518 $2,575,000 $1,696 17B 10/28/2013 2 BR 2 BA 1,518 $2,745,000 $1,808 18B 1/23/2014 2 BR 2 BA 1,518 $2,795,000 $1,841 19B 2/10/2014 2 BR 2 BA 1,518 $2,820,000 $1,858 12B 2/14/2014 2 BR 2 BA 1,518 $2,700,000 $1,779 14B 3/10/2014 2 BR 2 BA 1,518 $2,725,000 $1,795 20B 3/27/2014 2 BR 2 BA 1,518 $2,900,000 $1,910 10B 4/28/2014 2 BR 2 BA 1,518 $2,650,000 $1,746 6H 8/8/2013 1 BR 2.5 BA 1,164 $1,595,000 $1,370 7H 9/9/2013 1 BR 2.5 BA 1,164 $1,750,000 $1,503 3H 9/16/2013 1 BR 2.5 BA 1,164 $1,715,000 $1,473 5H 3/17/2014 1 BR 2.5 BA 1,164 $1,775,000 $1,525 4H 5/9/2014 1 BR 2.5 BA 1,164 $1,750,000 $1,503 4B 12/12/2013 2 BR 2 BA 1,632 $2,450,000 $1,501 5B 2/11/2014 2 BR 2 BA 1,632 $2,480,000 $1,520

TABLE 1 (Continued) 7D 10/29/2013 2 BR 2 BA 1,691 $2,550,000 $1,508 9A 2/7/2014 2 BR 2 BA 1,838 $2,995,000 $1,629 10A 12/20/2013 3 BR 2.5 BA 1,886 $3,310,000 $1,755 17A 12/20/2013 3 BR 2.5 BA 1,886 $3,520,000 $1,866 16A 1/16/2014 3 BR 2.5 BA 1,886 $3,485,000 $1,848 11A 1/17/2014 3 BR 2.5 BA 1,886 $3,345,000 $1,774 15A 1/29/2014 3 BR 2.5 BA 1,886 $3,450,000 $1,829 14A 1/30/2014 3 BR 2.5 BA 1,886 $3,415,000 $1,811 12A 2/5/2014 3 BR 2.5 BA 1,886 $3,380,000 $1,792 6A 3/21/2014 3 BR 2.5 BA 1,973 $3,800,000 $1,926 3D 10/1/2013 3 BR 3.5 BA 2,142 $3,300,000 $1,541 5D 8/13/2013 3 BR 3.5 BA 2,142 $3,300,000 $1,541 4D 3/6/2014 3 BR 3.5 BA 2,142 $3,325,000 $1,552 6G 12/27/2013 2 BR 2.5 BA 2,144 $3,040,000 $1,418 5G 1/28/2014 2 BR 2.5 BA 2,144 $2,995,000 $1,397 4G 4/7/2014 2 BR 2.5 BA 2,144 $2,995,000 $1,397 3G 5/9/2014 2 BR 2.5 BA 2,144 $2,985,000 $1,392 6D 2/18/2014 3 BR 3.5 BA 2,142 $3,385,000 $1,580 7G 8/5/2013 2 BR 2 BA 2,144 $2,995,000 $1,397 7A/8A1/28/2014 3 BR 4 BA 2,276 $5,000,000 $2,197 25A 10/3/2013 3 BR 3.5 BA 2,408 $4,710,000 $1,956 26A 10/24/2013 3 BR 3.5 BA 2,408 $4,760,000 $1,977 24A 11/11/2013 3 BR 3.5 BA 2,408 $4,660,000 $1,935 27A 11/15/2013 3 BR 3.5 BA 2,408 $4,960,000 $2,060 28A 12/29/2014 3 BR 3.5 BA 2,408 $5,295,000 $2,199 8D/9D12/29/2014 3 BR 4 BA 2,488 $4,800,000 $1,929 23C 5/21/2014 3 BR 2.5 BA 2,440 $4,874,250 $1,998 25C 1/21/2014 3 BR 2.5 BA 2,440 $4,610,000 $1,889 27C 10/9/2014 3 BR 2.5 BA 2,440 $4,950,000 $2,029 24C 12/10/2014 3 BR 2.5 BA 2,440 $4,750,000 $1,947 8B/9B9/24/2014 3 BR 4 BA 3,078 $6,775,000 $2,201 Total 140,546 $246,694,250 Wt. Avg 1,528 $2,681,459 $1,755 Source: Compiled by The Weitzman Group, Inc.

TABLE 2

Since opening the sales effort in July 2013, the first nine months of sales effort accounted for 77% of the total 92 units in contract through December 2014. Furthermore, the most active months were August 2013 with 15 units going into contract, September and October 2013 with 8 units going into contract during each month, January 2014 with 12 units going into contract, February 2014 with a total of 9 units going into contract, and May 2014 with 10 units going into contract. The least active months were April 2014 with only 2 units going into contract, July and August 2014 with no units going into contract, September

and October 2014 with only one unit going into contract for each month, and November 2014 with no units going into contract. The following scatter plot shows each sale by chunk price and sale date.

Sales as of 12/31/2014 $8,000,000

$7,000,000

$6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Source: Compiled by The Weitzman Group, Inc.

CONSTRUCTION TRENDS

The residential housing market in Manhattan is comprised of three major segments and it is virtually all mid- to high-rise, multi-family in nature. The largest segment consists of rental apartment buildings, many of which are under a form of rent stabilization and/or rent control. The second category consists of condominium or cooperative apartment buildings where ownership interests are held in individual apartments and most are owner-occupied. The third category consists of government-owned or heavily subsidized rental apartment buildings. Most cooperative buildings were created through the conversion of existing rental apartment buildings, while most condominiums represent new construction or gut renovation. In our market research, we have gathered market information related to the for-sale housing market from several resources. The market for the residential units proposed at the project will be determined largely by the marketability of the units themselves upon completion, according to the market’s perception of the quality of design and construction, as well as the building’s location. However, the health of the overall for-sale condominium housing market will be a major determinant of the ease by which the project is able to attract purchasers at competitive prices.

The following table and chart indicate that the construction of new housing units in Manhattan, as illustrated by the number of housing unit permits granted annually, increased significantly from the mid- 1990s until 2008. During the most recent residential boom from 2005 to 2008, the annual permit activity in Manhattan remained in the range of 8,493 housing unit permits (granted in 2005) to 9,700 housing unit permits (granted in 2008). In 2009, however, as the residential market weakened and construction and mortgage financing became much more difficult to obtain, consistent with overall trends in the City, permit activity in Manhattan sharply declined with only 1,363 housing unit permits granted in that year. This number further decreased in 2010, when only 704 housing unit permits were issued, representing the lowest number of housing permits in Manhattan issued in 15 years. The housing permit activity rebounded in 2011 and 2012, as 2,535 and 2,328 permits were granted, respectively, in Manhattan over

the two years.

Permitting activity more than doubled in 2013, with 4,856 permits issued during the year. In 2014, there were 5,435 permits issued in the Manhattan, surpassing the previous year’s total. While this figure remains well below the recent highs registered during the peak years from 2005 to 2008, the increase in the annual number of permits is expected to continue. In 2013 and 2014, the average residential building permitted in Manhattan comprised about 75 and 70 units, respectively, which was larger than the size of average buildings permitted in 2012, comprising about 55 units.

Annual Housing Units Permitted NYC vs. Manhattan 1990 - 2014 35,000 32,500 30,000 27,500 25,000 22,500 20,000 17,500 15,000

12,500 NumberofPermits 10,000 7,500 5,000 2,500 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Manhattan New York City

Source: U.S. Census Bureau - Building Permits Branch; compiled by The Weitzman Group, Inc.

TABLE 3 MANHATTAN BUILDING PERMITS - NEW RESIDENTIAL CONSTRUCTION 1990 - 2014

One-Family Two-Family Three and Four- Five or More- Year Manhattan Total Houses Houses Family Houses Family Houses % of % of % of % of NYC NYC NYC % of NYC NYC Units Total Units Total Units Total Units Total Units Total

1990 2 0.16% 0 0.00% 0 0.00% 2,396 71.69% 2,398 34.97% 1991 2 0.15% 0 0.00% 0 0.00% 754 56.86% 756 16.09% 1992 2 0.19% 0 0.00% 3 0.50% 368 43.45% 373 9.61% 1993 0 0.00% 0 0.00% 0 0.00% 1,148 68.95% 1,148 22.19% 1994 0 0.00% 2 0.15% 0 0.00% 426 40.19% 428 10.67% 1995 2 0.21% 0 0.00% 0 0.00% 1,127 62.09% 1,129 21.99% 1996 0 0.00% 2 0.09% 3 0.43% 3,364 75.01% 3,369 38.94% 1997 0 0.00% 0 0.00% 7 0.92% 3,755 71.14% 3,762 41.86% 1998 1 0.10% 4 0.17% 0 0.00% 3,818 64.67% 3,823 36.81% 1999 0 0.00% 4 0.13% 8 0.54% 3,779 58.89% 3,791 30.52% 2000 0 0.00% 30 0.86% 143 8.47% 4,937 59.90% 5,110 33.95% 2001 4 0.24% 10 0.27% 241 10.65% 5,854 63.97% 6,109 36.24% 2002 3 0.22% 6 0.16% 54 1.99% 5,344 50.47% 5,407 29.23% 2003 1 0.06% 14 0.30% 7 0.22% 5,210 44.26% 5,232 24.66% 2004 1 0.10% 6 0.12% 51 1.08% 4,497 31.37% 4,555 18.07% 2005 3 0.23% 2 0.05% 24 0.45% 8,464 40.58% 8,493 26.88% 2006 2 0.22% 8 0.21% 21 0.40% 8,759 41.77% 8,790 28.42% 2007 6 0.96% 4 0.13% 25 0.70% 9,485 38.41% 9,520 29.84% 2008 3 0.61% 0 0.00% 0 0.00% 9,697 31.44% 9,700 28.60% 2009 0 0.00% 0 0.00% 16 3.19% 1,347 30.01% 1,363 22.50% 2010 0 0.00% 4 0.39% 3 0.80% 697 13.91% 704 10.47% 2011 1 0.38% 0 0.00% 3 0.80% 2,531 34.52% 2,535 28.37% 2012 4 1.43% 4 0.61% 0 0.00% 2,320 26.18% 2,328 22.53% 2013 1 0.25% 10 1.13% 0 0.00% 4,845 30.04% 4,856 26.99% 2014 1 0.18% 14 1.83% 8 1.37% 5,412 29.11% 5,435 26.53%

Source: U.S. Census Bureau - Construction Statistics Division - Building Permits Branch; Compiled by The Weitzman Group, Inc. Note: Data as of February 28, 2015

Overall, the number of housing unit permits granted in Manhattan has averaged 5,342 permits per year over the period from 2000 to 2014, and 5,372 permits per year over the nine-year period from 2005 to 2014. These averages are higher than the long-term historical average of 4,045 housing unit permits granted per year over the 24-year period from 1990 to 2014, illustrative of the relatively high level of new residential construction in Manhattan during the last ten years. In 2014, the overall number of housing unit permits granted in Manhattan was 5,435, which comprises 26.53% of overall number of housing unit permits granted in New York City.

TABLE 4 NEW RESIDENTIAL HOUSING UNITS AUTHORIZED BY BUILDING PERMIT NEW YORK, NEW YORK ALL HOUSING UNITS, 1990 - 2014

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Manhattan 2,398 756 373 1,148 428 1,129 3,369 3,762 3,823 3,791 Brooklyn 1,634 1,024 646 1,016 911 943 942 1,063 1,787 2,894 Queens 704 602 351 531 560 738 1,301 1,144 1,446 2,169 Bronx 1,182 1,093 1,257 1,293 846 853 885 1,161 1,309 1,153 Staten Island 940 1,224 1,255 1,185 1,265 1,472 2,155 1,857 2,022 2,414 New York City 6,858 4,699 3,882 5,173 4,010 5,135 8,652 8,987 10,387 12,421

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Manhattan 5,110 6,109 5,407 5,232 4,555 8,493 8,790 9,520 9,700 1,363 Brooklyn 2,904 2,973 5,247 6,054 6,825 9,028 9,191 10,930 12,744 1,003 Queens 2,723 3,264 3,464 4,399 6,853 7,269 7,252 7,625 7,730 1,474 Bronx 1,646 2,216 2,626 2,935 4,924 4,937 4,658 3,088 2,482 1,647 Staten Island 2,667 2,294 1,756 2,598 2,051 1,872 1,036 739 1,255 570 New York City 15,050 16,856 18,500 21,218 25,208 31,599 30,927 31,902 33,911 6,057

2010 2011 2012 2013 2014 Manhattan 704 2,535 2,328 4,856 5,435 Brooklyn 2,093 1,522 3,353 6,140 7,551 Queens 2,358 3,182 1,428 3,161 4,900 Bronx 1,064 1,116 2,552 2,638 1,885 Staten Island 508 581 673 1,200 712 New York City 6,727 8,936 10,334 17,995 20,483

1990 - 2014 2000-2014 2005-2014 Avg / Avg / Avg / Total Year Total Year Total Year Manhattan 101,114 4,045 80,137 5,342 53,724 5,372 Brooklyn 100,418 4,017 87,558 5,837 63,555 6,356 Queens 76,628 3,065 67,082 4,472 46,379 4,638 Bronx 51,446 2,058 40,414 2,694 26,067 2,607 Staten Island 36,301 1,452 20,512 1,367 9,146 915 New York City 359,180 14,636 299,377 19,714 198,871 19,887

Source: U.S. Census Bureau - Construction Statistics Division - Building Permits Branch; Compiled by The Weitzman Group, Inc. Note: Data as of February 28, 2015

TABLE 5 PERMITS (UNITS) BY HOUSING TYPE NEW YORK, NEW YORK 1990 - 2014

Three and Four- Five or More- % of One-Family Houses Two-Family Houses Family Houses Family Houses TOTAL NYC Total Manhattan 39 0.0% 124 0.1% 617 0.6% 100,334 99.2% 101,114 100.0% 27.6% Brooklyn 2,639 2.6% 11,900 11.9% 16,712 16.6% 69,167 68.9% 100,418 100.0% 27.4% Queens 3,397 4.4% 19,328 25.2% 12,437 16.2% 41,466 54.1% 76,628 100.0% 20.9% Bronx 1,090 2.1% 10,062 19.6% 10,409 20.2% 29,885 58.1% 51,446 100.0% 14.1% Staten Island 16,986 46.8% 15,910 43.8% 252 0.7% 3,153 8.7% 36,301 100.0% 9.9% New York City 24,151 6.6% 57,324 15.7% 40,427 11.0% 244,005 66.7% 365,907 100.0% 100.0%

Source: U.S. Census Bureau - Construction Statistics Division - Building Permits Branch; Compiled by The Weitzman Group, Inc. Note: Data as of February 28, 2015

CONDOMINIUM MARKET OVERVIEW

THE LUXURY MARKET

Over the long term, the Manhattan condominium market has performed quite well, exhibiting consistent growth in the number of sale transactions as well as growth in sale price. In our analysis of condominium trends, we reviewed quarterly statistics from 2006 through the fourth quarter of 2014. We have started our analysis by reviewing trends in resale condominiums and new developments for Manhattan’s “luxury” market, defined by Corcoran as being comprised of the top ten percent of all condominium sales. The Halcyon does not fall into this category, although in more challenging market environments, this luxury product segment typically exhibits the greatest price sensitivity. The current market conditions in Manhattan are strongly influenced by the luxury market, and the public’s perception of the market health, overall, is largely defined by the activity in the luxury market. Thus, we have chosen to analyze the luxury market in an effort to add context to our understanding of market trends as applied to the Halcyon’s prospective sellout.

A period of strong demand for luxury properties in the mid-2000s led to a declining inventory in 2007, resulting in more units being sold than those that came on the market for the first time in years. Sales were largely concentrated in luxury condominiums, with few high-end co-op units available. The rise in super-luxury developments by renowned architects also added to the shift in condominium sales, with buyers showing a preference for the newest properties when seeking multi-million dollar residences.

In 2008, the onset of the recession slowed sales activity in Manhattan to its lowest level in five years. While new development sales trends indicate strong price levels through 2008, many of the sales during this period were for units whose contracts were signed in 2006 and 2007. With high-end developments such as 15 Central Park West being completed in 2008, the median sales price of luxury new developments peaked at $5.96 million and further at $6.50 million, during the second and fourth quarters of 2008, respectively. The surge in median and average prices was also attributed to the shift in the sale of larger and more expensive residences.

Post-Recession (2009 – 2013)

Prices declined significantly in 2009 and 2010, and were particularly exaggerated due to the closing of units in high-profile buildings in the previous year. By 2011, however, renewed confidence in the economy and favorable market conditions supported a return of buyers to the market. A significant number of new development transactions occurred in the Midtown East submarket, and smaller units accounted for a higher proportion of new development sales versus the previous year. In 2012, a sharp decline in new development inventory, particularly in prime submarkets, forced prospective buyers of new product inventory to enter the resale condo market, increasing the average per square foot price to a new peak of $2,568 in the first quarter of 2012. Median and average prices continued to grow over the next two years, with dramatic price increases in the new development market. The average per square foot price of new development sales grew from $1,960 in the first quarter of 2013 to $3,248 in the fourth quarter of 2013, while the average price per square foot of resale condominiums grew from $2,006 to $2,222, over the same period. A surge in luxury new development sales in the fourth quarter drove median and average prices to new heights, at $9.95 million and $11.01 million, respectively.

2014

Several super-luxury developments, which were initiated post-downturn, were completed in 2014. A majority of these are located on the East Side and Downtown. The median and average sales price of new development sales in the first quarter of 2014, growing to $9.62 million and $13.14 million, respectively. Sales have shifted toward larger units with nearly 31% of new development closings consisting of three- bedroom units. In the first quarter of 2014, the median and average sales prices in luxury new developments was roughly 2.5 times that of resale condominiums, and the average price per square foot for the new development market increased by 85.7% from the same quarter in the prior year to $3,681. In the second quarter of 2014, the median and average sale prices for new developments increased by 29.1% and 27.1%, respectively, from the previous quarter, to $12.41 million and $16.70 million. The prices for resale condominiums also grew significantly, with the median sale price increasing by 13.8% to $4.55 million and the average sale price increasing by 12.7% to $6.19 million. The average per square foot price reached a new high of $4,201 for luxury new development sales in the second quarter of 2014. Prices contracted slightly in the third quarter of 2014 with the median and average sales prices for resale condos declining 14.7% and 7.7%, respectively, from the previous quarter. For new developments, however, the median sales price recorded a slight increase of 0.3% while the average sales price reportedly declined 2.9% to $15.42 million for the quarter. During the fourth quarter of 2014, the median sales price over the prior quarter remained unchanged and the average sales price declined by 2.0%. New Developments noted a significant decline in median sales prices by 29% over the prior quarter, while average sales prices declined by 1.0% to $13.68 million.

The following table outlines quarterly trends in the luxury resale condominium and new development market in Manhattan from 2006 to 2014, as reported by the Corcoran Group.

TABLE 6 THE CORCORAN GROUP MANHATTAN LUXURY CONDOMINIUM MARKET Quarterly Trends 1Q 2006 - 4Q 2014

RESALE CONDOS NEW DEVELOPMENTS Median Average Average Median Average Average Quarter Sales Price % Chg Sales Price % Chg Price/SF % Chg Sales Price % Chg Sales Price % Chg Price/SF % Chg Q1 2006 $3,300,000 10.2% $4,801,000 21.1% $1,720 8.2% ------Q2 2006 $3,381,000 2.5% $4,225,000 -12.0% $1,625 -5.5% ------Q3 2006 $2,932,000 -13.3% $3,734,000 -11.6% $1,640 0.9% ------Q4 2006 $3,113,000 6.2% $4,115,000 10.2% $1,698 3.5% ------Q1 2007 $3,673,000 18.0% $5,234,000 27.2% $1,874 10.4% ------Q2 2007 $3,680,000 0.2% $4,500,000 -14.0% $1,785 -4.7% $3,340,000 - $4,115,000 - $1,948 - Q3 2007 $4,100,000 11.4% $4,971,000 10.5% $1,960 9.8% $4,825,000 44.5% $6,356,000 54.5% $2,460 26.3% Q4 2007 $3,950,000 -3.7% $5,137,000 3.3% $1,959 -0.1% $5,172,000 7.2% $6,469,000 1.8% $2,410 -2.0% Q1 2008 $4,149,000 5.0% $5,964,000 16.1% $2,124 8.4% $4,900,000 -5.3% $7,616,000 17.7% $2,505 3.9% Q2 2008 $4,375,000 5.4% $5,855,000 -1.8% $2,216 4.3% $5,962,000 21.7% $8,187,000 7.5% $3,027 20.8% Q3 2008 $4,100,000 -6.3% $5,570,000 -4.9% $2,435 9.9% $3,200,000 -46.3% $4,495,000 -45.1% $2,008 -33.7% Q4 2008 $3,700,000 -9.8% $4,819,000 -13.5% $1,939 -20.4% $6,500,000 103.1% $8,066,000 79.4% $2,669 32.9% Q1 2009 $4,149,000 12.1% $5,965,000 23.8% $2,124 9.5% $5,100,000 -21.5% $5,906,000 -26.8% $2,056 -23.0% Q2 2009 $3,000,000 -27.7% $3,924,000 -34.2% $1,577 -25.8% $4,607,000 -9.7% $6,034,000 2.2% $2,147 4.4% Q3 2009 $3,600,000 20.0% $4,627,000 17.9% $1,774 12.5% $5,195,000 12.8% $6,635,000 10.0% $2,223 3.5% Q4 2009 $3,100,000 -13.9% $4,710,000 1.8% $1,909 7.6% $5,950,000 14.5% $6,877,000 3.6% $2,239 0.7% Q1 2010 $3,995,000 28.9% $5,476,000 16.3% $1,978 3.6% $5,700,000 -4.2% $6,801,000 -1.1% $2,069 -7.6% Q2 2010 $3,575,000 -10.5% $4,445,000 -18.8% $1,840 -7.0% $5,750,000 0.9% $6,514,000 -4.2% $1,948 -5.8% Q3 2010 $3,800,000 6.3% $4,945,000 11.2% $1,927 4.7% $5,200,000 -9.6% $5,897,000 -9.5% $1,901 -2.4% Q4 2010 $3,950,000 3.9% $6,052,000 22.4% $2,216 15.0% $5,259,000 1.1% $6,310,000 7.0% $2,028 6.7% Q1 2011 $3,923,000 -0.7% $4,971,000 -17.9% $1,967 -11.2% $5,040,000 -4.2% $5,590,000 -11.4% $1,925 -5.1% Q2 2011 $3,850,000 -1.9% $4,738,000 -4.7% $1,869 -5.0% $4,100,000 -18.7% $5,020,000 -10.2% $1,803 -6.3% Q3 2011 $4,023,000 4.5% $5,317,000 12.2% $2,026 8.4% $5,016,000 22.3% $5,439,000 8.3% $1,966 9.0% Q4 2011 $3,263,000 -18.9% $4,499,000 -15.4% $1,904 -6.0% $6,038,000 20.4% $6,775,000 24.6% $2,166 10.2% Q1 2012 $4,600,000 41.0% $7,397,000 64.4% $2,568 34.9% $5,473,000 -9.4% $6,749,000 -0.4% $2,178 0.6% Q2 2012 $3,820,000 -17.0% $5,017,000 -32.2% $2,008 -21.8% $4,450,000 -18.7% $5,902,000 -12.6% $1,895 -13.0% Q3 2012 $3,500,000 -8.4% $4,460,000 -11.1% $1,891 -5.8% $4,598,000 3.3% $5,509,000 -6.7% $2,031 7.2% Q4 2012 $4,350,000 24.3% $5,394,000 20.9% $2,131 12.7% $4,553,000 -1.0% $5,896,000 7.0% $1,958 -3.6% Q1 2013 $3,480,000 -20.0% $4,531,000 -16.0% $2,006 -5.9% $5,170,000 13.6% $5,760,000 -2.3% $1,960 0.1% Q2 2013 $3,463,000 -0.5% $4,304,000 -5.0% $1,977 -1.4% $5,880,000 13.7% $7,934,000 37.7% $2,318 18.3% Q3 2013 $4,000,000 15.5% $4,979,000 15.7% $2,198 11.2% $5,689,000 -3.2% $7,564,000 -4.7% $2,504 8.0% Q4 2013 $4,175,000 4.4% $5,281,000 6.1% $2,222 1.1% $9,950,000 74.9% $11,011,000 45.6% $3,248 29.7% Q1 2014 $4,000,000 -4.2% $5,492,000 4.0% $2,305 3.7% $9,622,000 -3.3% $13,144,000 19.4% $3,681 13.3% Q2 2014 $4,550,000 13.8% $6,148,000 11.9% $2,393 3.8% $13,700,000 42.4% $15,883,000 20.8% $4,201 14.1% Q3 2014 $3,880,000 -14.7% $5,676,000 -7.7% $2,420 1.1% $13,746,000 0.3% $15,417,000 -2.9% $4,034 -4.0% Q4 2014 $4,000,000 0.0% $5,499,000 -2.0% $2,255 -8.0% $9,125,000 -29.0% $13,675,000 1.0% $3,935 4.0%

Source: The Corcoran Report; Compiled by The Weitzman Group Inc.

A comparison of the median sale prices, average sale prices, and average sale prices per square foot between the overall Manhattan luxury resale condominium market and the Manhattan luxury new development market is depicted in the following charts.

Manhattan Luxury Condominium Market: Median Sales Price $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000

$2,000,000

Q4 2012 Q4 2013 Q2 Q2 2007 Q2 2007 Q4 2008 Q2 2008 Q4 2009 Q2 2009 Q4 2010 Q2 2010 Q4 2011 Q2 2011 Q4 2012 Q2 2013 Q4 2014 Q2 2014 Q4

Resale Condominiums New Developments

Manhattan Luxury Condominium Market: Average Sales Price $18,000,000 $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000

$2,000,000

Q2 2010 Q2 2013 Q4 Q2 2007 Q2 2007 Q4 2008 Q2 2008 Q4 2009 Q2 2009 Q4 2010 Q4 2011 Q2 2011 Q4 2012 Q2 2012 Q4 2013 Q2 2014 Q2 2014 Q4

Resale Condominiums New Developments

Manhattan Luxury Condominium Market: Average Price Per Square Foot $4,500 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500

$1,000

Q2 2009 Q2 2013 Q4 Q2 Q2 2007 Q4 2007 Q2 2008 Q4 2008 Q4 2009 Q2 2010 Q4 2010 Q2 2011 Q4 2011 Q2 2012 Q4 2012 Q2 2013 Q2 2014 Q4 2014

Resale Condominiums New Developments

Source: The Corcoran Report; Compiled by The Weitzman Group Inc.

NEW DEVELOPMENT SALES BY NEIGHBORHOOD

More directly applicable to the condominium sale prospects of the Halcyon is the performance of the new development market on the East Side as compared with new development sales in other areas of Manhattan. The MNS Market Report summarizes the median sales price and the median sales price per square foot for new developments in various neighborhoods of Manhattan. While these median price points have fluctuated at times over the past three years, these fluctuations are due in large part to the available new supply that is on the market at any point in time. Within each neighborhood summarized in the following tables, there are new developments that are priced at varying levels on the pricing spectrum.

TABLE 7 MEDIAN SALES PRICE - NEW DEVELOPMENT SALES

Neighborhood 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014

Lower Manhattan Battery Park City $2,250,000 $1,100,000 $1,550,000 $275,000 $650,000 $984,500 $807,300 $895,000 $982,611 - $695,000 - $6,625,000 - $1,523,753 Financial District $800,000 $750,000 $650,000 $280,000 $575,000 $835,000 $796,500 $745,000 $789,143 $963,870 $1,075,000 $1,257,538 $1,072,429 $1,364,545 $1,082,908 Chelsea $1,700,000 $1,500,000 $1,650,000 $1,800,000 $900,000 $963,630 $1,321,179 $1,254,993 $1,374,637 $2,952,925 $3,355,714 $3,575,213 $2,325,000 $778,085 $1,780,664 East Village $1,000,000 $900,000 $450,000 $850,000 $3,600,000 $3,279,656 $850,000 $1,150,000 $977,520 - $4,900,000 - $1,157,713 $1,618,472 $1,780,664 Gramercy Park $4,800,000 $1,490,000 $1,000,000 $275,000 $650,000 $660,750 $2,240,150 $1,195,000 $1,180,000 $7,988,159 $2,087,412 $1,476,462 $1,450,836 $1,502,637 $1,988,632 Greenwich Village $2,400,000 $3,910,000 $7,650,000 $3,300,000 $2,850,000 $1,300,000 $3,425,000 $1,732,331 $1,946,531 $3,050,000 $2,469,256 $3,050,000 $2,775,000 $2,275,000 $2,876,556 SoHo $3,400,000 $1,500,000 $1,600,000 $9,200,000 $2,900,000 $1,321,613 $3,767,525 $3,834,675 $3,827,938 $2,500,000 $1,778,606 $1,574,235 $3,308,763 $4,700,000 $3,920,262 TriBeCa $2,500,000 $2,250,000 $6,000,000 $4,800,000 $2,700,000 $1,407,730 $1,355,000 $1,400,000 $1,601,489 $771,530 $3,054,750 $967,337 $5,100,000 - $3,705,206

West Side Midtown West $1,350,000 $905,000 $1,400,000 $2,000,000 $1,500,000 $1,300,000 $1,108,874 $1,350,000 $1,261,406 $627,615 $1,275,000 $1,415,000 $6,978,513 $2,999,419 $7,942,350 Upper West Side $2,400,000 $2,750,000 $3,300,000 $3,100,000 $2,000,000 $2,064,456 $2,000,000 $2,189,237 $2,007,125 $1,785,000 $2,036,500 $1,527,375 $2,039,045 $2,100,000 $1,405,185

East Side Midtown East $1,050,000 $915,000 $800,000 $400,000 $1,450,000 $1,375,000 $1,055,000 $1,355,125 $945,097 $1,072,765 $1,725,000 $1,527,375 $1,250,000 $1,480,000 - Murray Hill $1,000,000 $915,000 $2,000,000 $450,000 $1,750,000 $1,075,000 $995,000 $1,355,125 $1,299,666 $2,031,408 $1,858,306 $2,112,012 $1,590,513 $1,665,000 $3,215,124 Upper East Side $2,300,000 $2,000,000 $1,500,000 $2,800,000 $1,600,000 $1,555,000 $2,699,666 $1,985,272 $2,020,704 $1,883,762 $3,093,607 $2,775,000 $3,533,327 $3,920,262 $2,800,000

Source: MNS Market Report; compiled by The Weitzman Group Inc.

TABLE 8 MEDIAN PRICE PER SQUARE FOOT - NEW DEVELOPMENT SALES

Neighborhood 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014

Lower Manhattan Battery Park City $1,088 $923 $1,189 $881 $910 $1,017 $985 $1,019 $1,030 - $934 - $2,173 - $1,376 Financial District $906 $870 $922 $1,274 $954 $937 $995 $964 $1,039 $1,068 $1,083 $1,336 $1,277 $1,204 $1,489 Chelsea $1,163 $1,409 $1,296 $1,250 $1,236 $1,100 $1,226 $1,304 $1,335 $1,995 $2,041 $1,927 $1,642 $1,270 $1,516 East Village $1,159 $1,168 $1,042 $702 $1,886 $1,540 $993 $1,075 $751 - $2,099 - $1,409 $1,661 $1,377 Gramercy Park $2,035 $1,282 $1,232 $1,203 $1,238 $1,021 $1,808 $1,202 $1,318 $2,455 $1,533 $1,260 $1,361 $1,623 $2,003 Greenwich Village $1,548 $2,064 $3,072 $1,803 $1,781 $1,436 $1,973 $1,663 $1,820 $1,888 $2,325 $1,976 $2,425 $2,174 $2,033 SoHo $1,591 $1,914 $1,968 $3,193 $1,605 $1,939 $1,698 $1,570 $1,794 $1,722 $1,614 $1,826 $1,830 $2,010 $2,165 TriBeCa $1,280 $1,414 $1,817 $1,742 $1,384 $1,044 $1,006 $1,127 $1,323 $1,131 $1,724 $1,183 $1,740 - $1,960

West Side Midtown West $1,185 $1,018 $1,461 $1,562 $1,323 $1,436 $1,308 $1,514 $1,443 $1,242 $1,548 $1,810 $3,631 $2,769 $3,930 Upper West Side $1,327 $1,396 $1,680 $1,681 $1,492 $1,347 $1,415 $1,515 $1,380 $1,563 $1,409 $1,506 $1,541 $1,689 $1,512

East Side Midtown East $1,311 $1,165 $1,167 $1,009 $1,171 $1,147 $1,065 $1,270 $1,080 $1,149 $1,634 $1,450 $1,444 $1,625 - Murray Hill $1,103 $1,029 $1,596 $1,267 $1,467 $1,369 $1,138 $1,305 $1,185 $1,011 $1,240 $1,082 $1,128 $1,851 $2,105 Upper East Side $1,355 $1,449 $1,377 $1,427 $1,197 $1,278 $1,624 $1,386 $1,375 $1,172 $1,838 $1,973 $2,192 $2,381 $1,799 Source: MNS Market Report; compiled by The Weitzman Group Inc.

OVERALL SALES TRENDS IN MIDTOWN EAST

A further understanding of the overall sales trends, inclusive of both resales and new development units, is also helpful in understanding the market context to the Halcyon’s sellout prospects. A summary of sales trends for condominium units in the Midtown East submarket of Manhattan from 1995 through 2014 is presented in the following table, as reported by Douglas Elliman. These statistics are strongly impacted by the delivery of new supply. There have been fluctuations in volume and price, due in large part to the recessionary environment from 2008 into 2010, yet the median sales price has experienced steady growth and volume has recently been strong versus historical comparisons. While the number of sales in 2014 decreased by 15.5% from the prior year, the median and average sales price in 2014 grew by 10% and 6.2 %, respectively over the same period. The average price per square foot in 2014 was $1,611 which has been the highest over the past six years since 2008.

TABLE 9 MIDTOWN EAST* CONDOMINIUM MARKET TRENDS 1995 - 2014

Median Sales Average Sales Average Year No. of Sales % Chg. Price % Chg. Price % Chg. Price/SF % Chg. 1995 220 -- $270,000 -- $409,414 -- $341 -- 1996 318 44.5% $280,000 3.7% $474,457 15.9% $386 13.2% 1997 281 -11.6% $290,000 3.6% $491,539 3.6% $386 0.0% 1998 217 -22.8% $430,000 48.3% $729,835 48.5% $504 30.6% 1999 207 -4.6% $418,000 -2.8% $561,680 -23.0% $469 -6.9% 2000 320 54.6% $550,000 31.6% $954,999 70.0% $592 26.2% 2001 294 -8.1% $675,000 22.7% $1,030,001 7.9% $703 18.8% 2002 398 35.4% $815,000 20.7% $1,148,287 11.5% $751 6.8% 2003 349 -12.3% $725,000 -11.0% $986,125 -14.1% $773 2.9% 2004 419 20.1% $842,000 16.1% $1,248,809 26.6% $911 17.9% 2005 449 7.2% $1,235,000 46.7% $1,907,952 52.8% $1,264 38.7% 2006 404 -10.0% $1,395,000 13.0% $1,765,612 -7.5% $1,245 -1.5% 2007 648 60.4% $1,491,736 6.9% $2,430,088 37.6% $1,632 31.1% 2008 600 -7.4% $1,495,000 0.2% $2,475,424 1.9% $1,745 6.9% 2009 320 -46.7% $1,040,000 -30.4% $1,767,551 -28.6% $1,273 -27.0% 2010 422 31.9% $1,200,000 15.4% $2,152,095 21.8% $1,428 12.2% 2011 400 -5.2% $1,100,000 -8.3% $1,940,053 -9.9% $1,406 -1.5% 2012 331 -17.3% $1,300,000 18.2% $2,002,000 3.2% $1,470 4.6% 2013 445 34.4% $1,250,000 -3.8% $1,909,124 -4.6% $1,461 -0.6% 2014 376 -15.5% $1,375,000 10.0% $2,028,080 6.2% $1,611 10.3%

*Midtown East/Turtle Bay is defined as area bounded by 59th St. to the north, 42nd St. to the south, Avenue of the Americas to the west and the East River to the east.

Source: Douglas Elliman Manhattan Market Report & Miller Samuel Inc.; compiled by The Weitzman Group Inc.

Conclusion

Since the 2008 recession, the economic stabilization and growth in the United States and in New York City has created the context for an extremely strong Manhattan condominium market. Global economic volatility has driven purchasers from around the world to acquire New York City condominiums as an investment or for personal use, raising New York’s profile as a global capital city. Approximately 50% of the sales made thus far at the Halcyon have been to foreign purchasers. While the luxury condominium market has recently demonstrated some weakness, this comes after years of robust strength. We expect luxury condominium sales to continue, generally, on an upward price path. Among all condominium sales, the Midtown East submarket is experiencing continued strong growth, with an average price per square foot of $1,611 in 2014, corresponding to an average price of $2,028,080. The existing sales at the Halcyon, as well as the achievable pricing among unsold units, are well-supported by this data.

COMPARABLE CONDOMINIUM COMMUNITIES

The Veneto located at 250 East 53rd Street is a condominium complex developed by Related Companies in 2007 and designed by Davis Brody Bond. Comprising 135 residential units, the 32 story building offers condominiums ranging from one, two, to three bedrooms. Furthermore, the building’s owners benefits from a 421-A tax abatement. The double height lobby futures a cascading chandelier surrounded by a wood interior. Residence interior finishes were designed by Adam D. Tihany.

The interior finishes feature nine-foot ceiling heights, Brazilian cherry wood flooring, and oversized solarium windows. The kitchen areas have marble floors and granite counters paired with glass paneled cabinets alongside a Sub-Zero refrigerator, Bosch dishwasher, Viking gas range and a Miele Washer and Dryer. Bathrooms have custom-designed walnut double vanities, travertine marble flooring and counter tops, Kohler soaking tubs, Toto toilets, Valli and Valli satin chrome door hardware is found throughout. Amenities include a 24-hour doorman and concierge service, private storage area, on-premise parking garage, children’s playroom, and an entertainment lounge. The building is conveniently located in Turtle Bay, close to major subway lines, restaurants, museums, and shopping.

As of February 2015, there are 8 units listed at The Veneto. The average asking price among all units is $2.07 million, which equates to $1,822 per square foot based upon average unit size of 1,170 square feet. Among available units, monthly taxes average $528, or $0.46 per square foot, while monthly maintenance fees average $1,121, or $0.98 per square foot.

During 2014, the average closing price for units averaging 1,224 square feet in size was $2.04 million, which equates to an average per square foot price of $1,673. The following table summarizes this information.

TABLE 10 THE VENETO SALES SUMMARY As of February 2015

Total Number of Units: 135 Developer: The Related Companies

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #2901 2 beds 2.5 baths 1,559 $3,000,000 $1,924 $739 $0.47 $1,537 $0.99 #2101 2 beds 2.5 baths 1,578 $2,995,000 $1,898 $707 $0.45 $1,540 $0.98 #303 2 beds 2.5 baths 1,510 $2,385,000 $1,579 $693 $0.46 $1,442 $0.95 #304 1 bed 1 bath 845 $1,790,000 $2,118 $366 $0.43 $810 $0.96 #3003 1 bed 2 baths 966 $1,780,000 $1,843 $468 $0.48 $975 $1.01 #1903 1 bed 2 baths - $1,695,000 - $465 - $975 - #1403 1 bed 2 baths 970 $1,675,000 $1,727 $429 $0.44 $949 $0.98 #805* 1 bed 1 bath 763 $1,300,000 $1,704 $356 $0.47 $741 $0.97 Total / Wt. Avg 1,170 $2,077,500 $1,822 $528 $0.46 $1,121 $0.98

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

RECORDED SALES

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 11/17/2014 #1202 2 beds 2 baths 1,350 $2,375,000 $1,759 $628 $0.47 $1,307 $0.97 8/7/2014 #2903 1 bed 2 baths 966 $1,795,000 $1,858 $439 $0.45 $973 $1.01 6/19/2014 #1201 2 beds 2.5 baths 1,578 $2,695,000 $1,708 $687 $0.44 $1,523 $0.97 6/17/2014 #1102 2 beds 2 baths 1,331 $2,300,000 $1,728 $588 $0.44 $1,304 $0.98 6/13/2014 #606 1 bed 1.5 baths 890 $1,300,000 $1,461 $387 $0.43 $858 $0.96 6/9/2014 #1602 2 beds 2 baths 1,350 $2,388,000 $1,769 $590 $0.44 $1,314 $0.97 5/12/2014 #2003 1 bed 2 baths 983 $1,675,000 $1,704 $432 $0.44 $960 $0.98 4/30/2014 #705 1 bed 1 bath 763 $1,250,000 $1,638 $332 $0.44 $738 $0.97 4/11/2014 #2502 2 beds 2 baths 1,335 $2,275,000 $1,704 $595 $0.45 $1,454 $1.09 4/3/2014 #703 1 bed 1 bath 890 $1,225,000 $1,376 $360 $0.40 $772 $0.87 3/31/2014 #1704 3 beds 3 baths 1,930 $3,500,000 $1,813 $842 $0.44 $1,868 $0.97 3/6/2014 #407 2 beds 2.5 baths 1,617 $2,399,000 $1,484 $698 $0.43 $1,545 $0.96 2/28/2014 #503 1 bed 1 bath 823 $1,144,000 $1,390 $358 $0.43 $769 $0.93 2/4/2014 #3202 2 beds 2 baths 1,335 $2,350,000 $1,760 $601 $0.45 $1,291 $0.97 2014 Total / Wt. Avg 1,224 $2,047,929 $1,673 $538 $0.44 $1,191 $0.97

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 10/29/2013 #2801 - - - $2,700,000 - - - - - 10/3/2013 #1402 2 beds 2 baths 1,350 $2,125,000 $1,574 $593 $0.44 $1,272 $0.94 9/26/2013 #2802 2 beds 2 baths 1,350 $2,275,000 $1,685 $513 $0.38 $1,254 $0.93 8/19/2013 #1502 2 beds 2 baths 1,350 $2,150,000 $1,593 $305 $0.23 $1,274 $0.94 8/15/2013 #601 1 bed 2 baths 1,043 $1,450,000 $1,390 $197 $0.19 $980 $0.94 7/1/2013 #804 2 beds 2.5 baths 1,438 $2,240,000 $1,558 $327 $0.23 $1,342 $0.93 6/28/2013 #1203 1 bed 2 baths 976 $1,550,000 $1,588 $226 $0.23 $918 $0.94 6/13/2013 #1702 - - - $2,170,000 - - - - - 5/31/2013 #2204 3 beds 3 baths - $2,875,000 - $443 - $1,815 - 5/28/2013 #2103 1 bed 2 baths 970 $1,575,000 $1,624 $225 $0.23 $975 $1.01 4/25/2013 #3303 1 bed 2 baths 966 $1,615,000 $1,672 $237 $0.25 $934 $0.97 4/24/2013 #1601 2 beds 2.5 baths 1,578 $2,250,000 $1,426 $347 $0.22 $1,457 $0.92 2/25/2013 #2403 1 bed 2 baths 980 $1,595,000 $1,628 $227 $0.23 $918 $0.94 2013 Total / Wt. Avg 1,200 $2,043,846 $1,569 $331 $0.30 $1,194 $0.94

TABLE 10 (Continued) Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/21/2012 #803 1 bed 1 bath 823 $1,055,000 $1,282 $181 $0.22 $759 $0.92 11/26/2012 #2803 - - - $1,450,000 - - - - - 10/23/2012 #1902 - - - $1,970,000 - - - - - 9/12/2012 #1002 2 beds 2 baths 1,350 $1,775,000 $1,315 $315 $0.23 $1,240 $0.92 8/29/2012 #2401 2 beds 2.5 baths 1,560 $2,350,000 $1,506 $352 $0.23 $1,464 $0.94 8/17/2012 #2304 3 beds 3 baths 1,922 $3,000,000 $1,561 $427 $0.22 $1,781 $0.93 7/25/2012 #2503 - - - $1,440,000 - - - - - 6/14/2012 #1404 3 beds 3 baths 1,930 $2,735,000 $1,417 $300 $0.16 $1,754 $0.91 5/24/2012 #2404 3 beds 3 baths 1,900 $3,100,000 $1,632 $430 $0.23 $1,800 $0.95 5/15/2012 #702 2 beds 2 baths 1,301 $1,825,000 $1,403 $285 $0.22 $1,190 $0.91 5/4/2012 #1703 2 beds 2.5 baths 1,559 $2,360,000 $1,514 $352 $0.23 $1,462 $0.94 5/4/2012 #2001 - - - $1,310,000 - - - - - 2012 Total / Wt. Avg 1,543 $2,030,833 $1,474 $330 $0.21 $1,431 $0.93

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/16/2011 #3001 2 beds 2.5 baths - $2,325,000 - $348 - $1,464 - 11/22/2011 #2804 2 beds 2.5 baths - $2,350,000 - $240 - $1,465 - 11/7/2011 #2701 3 beds 3 baths 1,916 $2,835,000 $1,480 $90 $0.05 $1,754 $0.92 7/8/2011 #1803 2 beds 2.5 baths 1,559 $2,325,000 $1,491 $238 $0.15 $1,460 $0.94 7/8/2011 #3302 1 bed 2 baths 966 $1,375,000 $1,423 $149 $0.15 $911 $0.94 6/30/2011 #2603 2 beds 2 baths 1,331 $1,975,000 $1,484 $300 $0.23 $1,268 $0.95 4/15/2011 #1701 1 bed 2 baths 966 $1,430,000 $1,480 $150 $0.16 $921 $0.95 2/14/2011 #3204 2 beds 2.5 baths 1,578 $2,250,000 $1,426 $78 $0.05 $1,459 $0.92 2/3/2011 #901 3 beds 3 baths 1,916 $2,900,000 $1,514 $94 $0.05 $1,792 $0.94 1/28/2011 #2002 2 beds 2.5 baths 1,578 $2,025,000 $1,283 $83 $0.05 $1,524 $0.97 1/18/2011 #801 2 beds 2 baths 1,339 $1,990,000 $1,486 $67 $0.05 $1,248 $0.93 2011 Total / Wt. Avg 1,461 $2,161,818 $1,453 $167 $0.09 $1,388 $0.94

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

Three Ten, located at 310 East 53rd Street, is a condominium building developed by Macklowe Properties in 2006 and designed by SLCE Architects. The building is set on a five-story limestone base followed by a glass tower. Comprising 85 residential units, the 28-story building offers condominiums including one, two, and three bedroom homes.

The unit interior finishes feature 17-foot ceilings, gray limestone floors, zebra wood doors, and remote controlled shades. The kitchen areas feature Sub-Zero refrigerators, Gaggenau cooktops, Thermador ovens, and Carrara marble countertops. Bathrooms have white marble interior alongside his and her sinks. Amenities include a fitness center, children’s playroom, lounge area, and 24- hour doorman. The building is located in Turtle Bay, at the southeast corner of Second Avenue.

As of February 2015, there are 10 units listed at Three Ten. The average asking price among all units is $3.24 million, which equates to $1,646 per square foot based upon average unit size of 1,971. Among available units, monthly taxes

average $1,330, or $0.67 per square foot, while monthly maintenance fees average $2,651, or $1.35 per square foot.

During 2014, the average closing price for units averaging 1,739 square feet in size was $2.64 million, which equates to an average per-square-foot price of $1,519. The following table summarizes this information.

TABLE 11 THREE TEN SALES SUMMARY As of February 2015

Total Number of Units: 85 Developer: Macklowe Properties

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #26BC 5 beds 5.5 baths 4,062 $7,195,000 $1,771 $2,145 $0.53 $5,454 $1.34 #24C 3 beds 3.5 baths 2,313 $4,700,000 $2,032 $1,593 $0.69 $3,083 $1.33 #28A 2 beds 2.5 baths 1,603 $3,150,000 $1,965 $1,084 $0.68 $2,124 $1.33 #10A 2 beds 2.5 baths 1,603 $3,000,000 $1,871 $820 $0.51 $2,124 $1.33 #8A 2 beds 2.5 baths 1,603 $2,925,000 $1,825 $827 $0.52 $2,124 $1.33 #4/5F 2 beds 2 baths 1,768 $2,699,000 $1,527 $947 $0.54 $2,320 $1.31 #4/5G 1 bed 2 baths 1,901 $2,395,000 $1,260 $1,260 $0.66 $2,687 $1.41 #4/5D 1 bed 2 baths 1,613 $2,395,000 $1,485 $2,405 $1.49 $2,293 $1.42 #23D 1 bed 2 baths 1,700 $1,999,000 $1,176 $1,134 $0.67 $2,197 $1.29 #4/5C 1 bed 2 baths 1,543 $1,980,000 $1,283 $1,087 $0.70 $2,106 $1.36 Total / Wt. Avg 1,971 $3,243,800 $1,646 $1,330 $0.67 $2,651 $1.35

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

TABLE 11 (Continued) RECORDED SALES

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 8/4/2014 #17B 3 beds 3 baths 1,749 $3,500,000 $2,001 $713 $0.41 $2,368 $1.35 5/7/2014 #19A 2 beds 2.5 baths 1,603 $2,900,000 $1,809 $827 $0.52 $2,123 $1.32 4/1/2014 #4/5B 1 bed 2 baths 1,704 $2,495,000 $1,464 $692 $0.41 $2,337 $1.37 2/7/2014 #4/5G 2 beds 2 baths 1,901 $1,670,000 $878 $945 $0.50 $2,688 $1.41 2014 Total / Wt. Avg 1,739 $2,641,250 $1,519 $794 $0.46 $2,379 $1.37

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/19/2013 #18A 2 beds 2.5 baths 1,603 $2,800,000 $1,747 $640 $0.40 $2,123 $1.32 11/20/2013 #2/3E - - - $1,595,000 - - - - - 6/21/2013 #14B 2 beds 2.5 baths 1,750 $2,682,000 $1,533 $897 $0.51 $2,370 $1.35 6/21/2013 #30A 2 beds 2.5 baths 1,603 $2,850,000 $1,778 $818 $0.51 $2,123 $1.32 6/10/2013 #20C 3 beds 3.5 baths 2,313 $4,100,000 $1,773 $1,190 $0.51 $3,083 $1.33 6/3/2013 #4/5F 1 bed 2 baths 1,768 $1,650,000 $933 $2,300 $1.30 $850 $0.48 5/3/2013 #4/5E 2 beds 2 baths 1,700 $1,530,000 $900 $894 $0.53 $2,275 $1.34 1/16/2013 #14A 2 beds 2.5 baths 1,603 $2,425,000 $1,513 $578 $0.36 $2,124 $1.33 1/4/2013 #16A 3 beds 3 baths 1,749 $2,710,000 $1,549 $932 $0.53 $2,370 $1.36 2013 Total / Wt. Avg 1,761 $2,482,444 $1,473 $1,031 $0.59 $2,165 $1.23

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/28/2012 #4/5D 2 beds 2.5 baths 1,603 $2,600,000 $1,622 $827 $0.52 $2,124 $1.33 12/21/2012 #12B - - - $2,000,000 - - - - - 12/20/2012 #23A 3 beds 2.5 baths 1,749 $2,375,000 $1,358 $585 $0.33 $2,250 $1.29 9/14/2012 #9B 2 beds 2.5 baths 1,603 $2,700,000 $1,684 $547 $0.34 $2,125 $1.33 7/23/2012 #7C 3 beds 2.5 baths 1,749 $2,375,000 $1,358 $609 $0.35 $2,368 $1.35 5/24/2012 #7B 1 bed 1.5 baths 1,156 $1,100,000 $952 $391 $0.34 $1,521 $1.32 4/30/2012 #18B 2 beds 2.5 baths 1,603 $2,100,500 $1,310 $841 $0.52 $1,975 $1.23 4/12/2012 #21C 3 beds 3 baths 1,749 $2,575,000 $1,472 $606 $0.35 $2,272 $1.30 3/15/2012 #19B 3 beds 3.5 baths 2,313 $3,850,000 $1,665 $790 $0.34 $3,083 $1.33 2012 Total / Wt. Avg 1,691 $2,408,389 $1,455 $650 $0.38 $2,215 $1.31

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 11/1/2011 #24C 3 beds 3 baths 2,333 $3,850,000 $1,650 $762 $0.33 $2,964 $1.27

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

The Alexander is a condominium complex located at 250 East 49th Street that was developed by Alexander Gurevich in 2010 and designed by Sydness Architects. The building carries a 421-A tax abatement. The façade features an all-glass curved silhouette and terracotta base. Comprising 75 residential units, the 24-story building includes condominiums with one, two, and three bedrooms.

The units feature 12-foot ceilings, white oak floors, central heating and air conditioning. The kitchens have top-of-the-line appliances such as a Sub-Zero refrigerator, Viking gas cooktop and microwave, and a Miele dishwasher. The bathrooms are designed with limestone and glass tiles along with custom vanities and Runtal heated towel bars. Amenities include a 24-hour doorman, fitness center, a landscaped roof terrace, and a private storage area. Located in Turtle Bay, the development is in walking distance to Grand Central Terminal, and the Metro-North Railroad making it exceptionally convenient.

As of February 2015, there are 2 units listed at The Alexander. The average asking price among both units is $1.52 million, which equates to $1,835 per square foot based upon average unit size of 831 square feet. Among available units, monthly taxes average $416, or $0.50 per square foot, while monthly maintenance fees average $791, or $0.95 per square foot.

During 2014, the average closing price for units averaging 1,285 square feet in size was $2.20 million, which equates to an average per-square-foot price of $1,716. The following table summarizes this information.

TABLE 12 THE ALEXANDER SALES SUMMARY As of February 2015

Total Number of Units: 75 Developer: Alexander Gurevich

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #21D* 2 beds 2 baths 995 $1,750,000 $1,759 $490 $0.49 $1,006 $1.01 #20B 1 beds 1 bath 667 $1,300,000 $1,949 $341 $0.51 $576 $0.86 Total / Wt. Avg 831 $1,525,000 $1,835 $416 $0.50 $791 $0.95

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

TABLE 12 (Continued) RECORDED SALES

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/1/2014 #12C 2 beds 2 baths 1,091 $1,810,000 $1,659 $543 $0.50 $1,103 $1.01 11/24/2014 #23CD 4 beds 3.5 baths 2,086 $3,890,000 $1,865 $514 $0.25 $1,476 $0.71 3/17/2014 #19A 1 bed 1 bath 647 $1,040,000 $1,607 $320 $0.49 $560 $0.87 2/4/2014 #22AB 2 beds 3 baths 1,314 $2,075,000 $1,579 $614 $0.47 $1,135 $0.86 2014 Total / Wt. Avg 1,285 $2,203,750 $1,716 $498 $0.39 $1,069 $0.83

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 9/30/2013 #15CD 3 beds 3.5 baths 2,086 $3,490,000 $1,673 $498 $0.24 $1,476 $0.71 9/4/2013 #15A 1 bed 1 bath 647 $999,999 - $155 - $461 - 7/24/2013 #18A 1 bed 1 bath 670 $1,105,000 $1,649 $156 $0.23 $461 $0.69 6/4/2013 #6CD - - - $3,822,000 - - - - - 2/6/2013 #20CD 3 beds 3.5 baths 2,086 $3,716,612 $1,782 $514 $0.25 $1,476 $0.71 2013 Total / Wt. Avg 1,372 $2,626,722 $1,696 $331 $0.24 $969 $0.71

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/5/2012 #14AB 2 beds 3 baths 1,314 $1,527,375 $1,162 $314 $0.24 $931 $0.71 9/27/2012 #6B - - - $840,056 - - - - - 9/27/2012 #6A - - - $814,600 - - - - - 7/2/2012 #17A 1 bed 1 bath 647 $885,000 $1,368 $159 $0.25 $458 $0.71 6/20/2012 #22CD 3 beds 3.5 baths 2,086 $3,716,612 $1,782 $514 $0.25 $1,476 $0.71 6/11/2012 #16AB 2 beds 3 baths 1,314 $1,547,740 $1,178 $314 $0.24 $931 $0.71 5/25/2012 #7C 2 beds 2 baths 1,091 $1,298,268 $1,190 $261 $0.24 $773 $0.71 4/27/2012 #9C 2 beds 2 baths 1,091 $1,323,725 $1,213 $261 $0.24 $773 $0.71 4/19/2012 #10C 2 beds 2 baths 1,091 $1,333,907 $1,223 $261 $0.24 $773 $0.71 3/2/2012 #4D 2 beds 2 baths 1,447 $1,440,823 $996 $345 $0.24 $1,026 $0.71 1/11/2012 #4A 1 bed 1 bath 802 $809,508 $1,009 $192 $0.24 $571 $0.71 2012 Total / Wt. Avg 1,209 $1,412,510 $1,276 $291 $0.24 $857 $0.71

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 11/15/2011 #18CD 3 beds 3.5 baths 2,086 $3,126,027 $1,499 $498 $0.24 $1,476 $0.71 11/14/2011 #11B 1 bed 1 bath 667 $824,782 $1,237 $167 $0.25 $387 $0.58 10/24/2011 #5B 1 bed 1 bath 1,024 $1,018,248 $994 $244 $0.24 $727 $0.71 10/5/2011 #11A 1 bed 1 bath 647 $743,322 $1,149 $155 $0.24 $458 $0.71 9/27/2011 #17D 2 beds 2 baths 995 $1,349,181 $1,356 $237 $0.24 $705 $0.71 9/15/2011 #16C 2 beds 2 baths 1,091 $1,349,181 $1,237 $270 $0.25 $633 $0.58 9/13/2011 #8C 2 beds 2 baths 1,091 $1,323,725 $1,213 $773 $0.71 $261 $0.24 9/1/2011 #23AB 2 beds 3 baths 1,314 $1,731,025 $1,317 $396 $0.30 $763 $0.58 7/28/2011 #3A 2 beds 3 baths 1,314 $1,710,660 $1,302 $314 $0.24 $931 $0.71 7/8/2011 #21A 1 bed 1 bath 852 $784,052 $920 $192 $0.23 $571 $0.67 7/6/2011 #10D 1 bed 1 bath 647 $814,600 $1,259 $155 $0.24 $458 $0.71 6/24/2011 #15B 2 beds 2 baths 995 $1,221,900 $1,228 $237 $0.24 $705 $0.71 6/22/2011 #19B 1 bed 1 bath 667 $784,052 $1,175 $160 $0.24 $473 $0.71 6/21/2011 #3D 1 bed 1 bath 667 $814,600 $1,221 $160 $0.24 $473 $0.71 6/2/2011 #5A 2 beds 2 baths 1,447 $1,323,725 $915 $308 $0.21 $840 $0.58 6/1/2011 #9B 1 bed 1 bath 802 $829,873 $1,035 $192 $0.24 $571 $0.71 5/27/2011 #9D 1 bed 1 bath 667 $763,687 $1,145 $160 $0.24 $473 $0.71 5/25/2011 #17C 2 beds 2 baths 995 $1,120,075 $1,126 $176 $0.18 $577 $0.58 5/20/2011 #4E 2 beds 2 baths 1,091 $1,425,550 $1,307 $261 $0.24 $773 $0.71 5/6/2011 #17B 2 beds 2 baths 1,296 $1,313,542 $1,014 $282 $0.22 $917 $0.71 5/5/2011 #7D 1 bed 1 bath 667 $804,417 $1,206 $167 $0.25 $387 $0.58 5/3/2011 #4C 1 bed 1 bath 647 $794,235 $1,228 $158 $0.24 $375 $0.58 4/13/2011 #3E 2 beds 2 baths 1,091 $1,349,181 $1,237 $270 $0.25 $633 $0.58 4/6/2011 #21D 2 beds 2 baths 995 $1,170,987 $1,177 $228 $0.23 $705 $0.71 4/6/2011 #5C 1 bed 1 bath 647 $763,687 $1,180 $159 $0.25 $378 $0.58 3/30/2011 #8D 1 bed 1 bath 744 $814,600 $1,095 $164 $0.22 $527 $0.71 3/10/2011 #20A 2 beds 2 baths 1,296 $1,313,542 $1,014 $282 $0.22 $830 $0.64 3/9/2011 #8A 2 beds 2 baths 995 $1,451,006 $1,458 $276 $0.28 $577 $0.58 2/17/2011 #12A 1 bed 1 bath 744 $824,782 $1,109 $164 $0.22 $527 $0.71 2/11/2011 #3B 2 beds 2 baths 995 $1,151,131 $1,157 $228 $0.23 $705 $0.71 2/10/2011 #5E 1 bed 1 bath 647 $778,961 $1,204 $115 $0.18 $377 $0.58 1/28/2011 #9A 1 bed 1 bath 647 $692,410 $1,070 $149 $0.23 $458 $0.71 1/19/2011 #10A 1 bed 1 bath 647 $738,231 $1,141 $159 $0.25 $378 $0.58 2011 Total / Wt. Avg 943 $1,121,787 $1,190 $238 $0.25 $607 $0.64

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

252 East 57th Street is a condominium complex being developed by World Wide Group and Rose Associates, and is expected to be completed in 2016. The building is being designed by SLCE Architects. The building façade will be constructed of curved glass and provide residents panoramic views. Comprising 93 residential units, the 65-story building will offer condominiums ranging from two to five bedrooms.

The building will feature a marble-clad lobby along with a walnut paneled sitting room. Interior finishes designed by Daniel Romualdez, will feature 10- foot ceiling heights, glass walls, and ¾ inch white oak floors. The kitchen areas will have HanStone glass quartz countertops, walnut cabinetry, Miele appliances, Brazilian cherry wood flooring, and oversized solarium windows. Amenities include a Technogym-equipped gym, pilates area, a yoga and spin studios, a screening room, billiard rooms, children’s playroom, and a spa which offer a 75 foot swimming pool.

As of February 2015, there are 13 units listed at 252 East 57th Street. The average asking price among all units is $7.51 million, which equates to $3,023 per square foot based upon average unit size of 2,485 square feet. Among available units, monthly taxes average $2,201, or $0.89 per square foot, while monthly maintenance fees average $4,851, or $1.95 per square foot.

TABLE 13 252 EAST 57TH STREET SALES SUMMARY As of February 2015

Total Number of Units: 93 Developer: World Wide Group and Rose Associates

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #58A 5 beds 5.5 baths 5,242 $21,250,000 $4,054 $4,681 $0.89 $10,319 $1.97 #60B 4 beds 4.5 baths 3,338 $13,150,000 $3,939 $2,979 $0.89 $6,567 $1.97 #51C 3 beds 3.5 baths 3,054 $9,350,000 $3,062 $2,712 $0.89 $5,979 $1.96 #51A 3 beds 3.5 baths 2,626 $8,350,000 $3,180 $2,335 $0.89 $5,146 $1.96 #51B 3 beds 3 baths 2,271 $6,350,000 $2,796 $2,004 $0.88 $4,417 $1.94 #42A 3 beds 3.5 baths 2,198 $5,750,000 $2,616 $1,946 $0.89 $4,289 $1.95 #42C 3 beds 3.5 baths 2,196 $5,750,000 $2,618 $1,944 $0.89 $4,286 $1.95 #37A 3 beds 3 baths 2,016 $4,925,000 $2,443 $1,780 $0.88 $3,924 $1.95 #37C 3 beds 3 baths 2,013 $4,925,000 $2,447 $1,778 $0.88 $3,918 $1.95 #37B 3 beds 3 baths 1,929 $4,735,000 $2,455 $1,690 $0.88 $3,725 $1.93 #37D 3 beds 3 baths 1,931 $4,735,000 $2,452 $1,692 $0.88 $3,729 $1.93 #42B 2 beds 2.5 baths 1,750 $4,195,000 $2,397 $1,537 $0.88 $3,388 $1.94 #42D 2 beds 2.5 baths 1,742 $4,195,000 $2,408 $1,530 $0.88 $3,373 $1.94 Total / Wt. Avg 2,485 $7,512,308 $3,023 $2,201 $0.89 $4,851 $1.95

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

301 East 50th Street is a condominium development built by CBSK Ironstate in 2014. The building was designed by CookFox Architects. The development’s exterior is finished in limestone. Comprising 57 residential units, the 29-story building will offer condominiums ranging from one to four bedrooms.

The interior finishes include five inch tobacco-stained oak floors, lacquered doors with Omnia custom hardware, multi-zone high performance heating and cooling systems, and LED light fixtures. The kitchen features Caesarstone countertops and Gaggenau appliances, while the master bathrooms have full-height Bianco Alanur marble walls with Calacatta Gold bow-tie mosaic flooring and Waterworks fixtures. Building amenities include a fitness center with double-height ceilings, cedar sauna, steam room, tea lounge, a landscaped terrace, and a 24-hour doorman and concierge.

As of February 2015, there are 35 units listed at 301 East 50th Street of which 25 are in contract. The average asking price among all units is $2.95 million, which equates to $1,973 per square foot based upon average unit size of 1,498 square feet. Among available units, monthly maintenance fees average $2,707, or $1.81 per square foot. Furthermore, the building features 421-A tax abatement. Since launching sales in May 2014, the development has 25 units in contract indicating an absorption rate of about 3 units per month.

TABLE 14 301 EAST 50TH STREET SALES SUMMARY As of February 2015

Total Number of Units: 57 Developer: CBSK Ironstate

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #23A 3 beds 2.5 baths 2,195 $4,900,000 $2,232 - - $4,106 $1.87 #19A* 3 beds 2.5 baths 2,195 $4,500,000 $2,050 - - $4,032 $1.84 #17B 3 beds 2.5 baths 2,021 $4,250,000 $2,103 - - $3,677 $1.82 #12B 3 beds 2.5 baths 2,021 $3,950,000 $1,954 - - $3,608 $1.79 #17A* 2 beds 2 baths 1,833 $3,800,000 $2,073 - - $3,335 $1.82 #24B 2 beds 2 baths 1,690 $3,775,000 $2,234 - - $3,175 $1.88 #18A* 2 beds 1.5 baths 1,833 $3,775,000 $2,059 - - $3,319 $1.81 #16A* 2 beds 1.5 baths 1,833 $3,625,000 $1,978 - - $3,147 $1.72 #22B* 2 beds 1.5 baths 1,690 $3,625,000 $2,145 - - $3,147 $1.86 #15A* 2 beds 1.5 baths 1,833 $3,550,000 $1,937 - - $3,304 $1.80 #21B* 2 beds 1.5 baths 1,690 $3,500,000 $2,071 - - $3,132 $1.85 #20B* 2 beds 1.5 baths 1,690 $3,425,000 $2,027 - - $3,118 $1.84 #19B* 2 beds 1.5 baths 1,690 $3,400,000 $2,012 - - $3,103 $1.84 #14A* 2 beds 1.5 baths 1,833 $3,375,000 $1,841 - - $3,288 $1.79 #12A* 2 beds 1.5 baths 1,833 $3,300,000 $1,800 - - $3,273 $1.79 #5A 2 beds 1.5 baths 1,445 $3,250,000 $2,249 - - $3,126 $2.16 #5C* 2 beds 1.5 baths 1,459 $2,950,000 $2,022 - - $3,045 $2.09 #10A 2 beds 1.5 baths 1,447 $2,950,000 $2,039 - - $2,559 $1.77 #9A* 2 beds 1.5 baths 1,447 $2,900,000 $2,004 - - $2,547 $1.76 #9C 2 beds 1.5 baths 1,459 $2,850,000 $1,953 - - $2,568 $1.76 #7A* 2 beds 1.5 baths 1,447 $2,800,000 $1,935 - - $2,522 $1.74 #6C 2 beds 1.5 baths 1,459 $2,700,000 $1,851 - - $2,531 $1.73 #3B* 2 beds 1.5 baths 1,564 $2,650,000 $1,694 - - $2,673 $1.71 #3A* 2 beds 1.5 baths 1,286 $2,350,000 $1,827 - - $2,197 $1.71 #4A* 2 beds 1.5 baths 1,286 $2,350,000 $1,827 - - $2,208 $1.72 #7B* 1 bed 1.5 baths 947 $1,895,000 $2,001 - - $1,650 $1.74 #9B* 1 bed 1.5 baths 947 $1,875,000 $1,980 - - $1,666 $1.76 #4C 1 bed 1.5 baths 1,069 $1,825,000 $1,707 - - $1,836 $1.72 #11B* 1 bed 1.5 baths 947 $1,800,000 $1,901 - - $1,682 $1.78 #8B* 1 bed 1.5 baths 947 $1,775,000 $1,874 - - $1,659 $1.75 #10B* 1 bed 1.5 baths 947 $1,775,000 $1,874 - - $1,674 $1.77 #3C* 1 bed 1.5 baths 1,050 $1,695,000 $1,614 - - $1,794 $1.71 #6B* 1 bed 1.5 baths 947 $1,675,000 $1,769 - - $1,642 $1.73 #5B* 1 bed 1.5 baths 941 $1,650,000 $1,753 - - $1,699 $1.81 Total / Wt. Avg 1,498 $2,954,853 $1,973 - - $2,707 $1.81

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

Place 57, located at 207 East 57th Street, is a condominium project developed by Clarett Group and Prudential Real Estate Investors, and designed by Ismael Leyva Architects. It was constructed in 2005. The building’s façade is comprised of glass and steel. Comprising 67 residential units, the 36-story building includes condominiums with one, two, and three bedrooms. Each floor averages two apartments. Numerous chandeliers, natural stone floors, and crystal cover the building’s lobby which was designed by the interior designer Vicente Wolf.

The interior finishes feature 9’4” ceiling heights, Brazilian walnut floors, a windowed kitchen equipped with Viking and Whirlpool appliances and stone countertops, and bathrooms withy Waterworks fixtures. Amenities include a residents’ lounge, a private garden, fitness center, a children’s playroom, and 24-hour doorman and concierge services.

As of February 2015, there are 2 units listed at Place 57. The average asking price among all units is $3.64 million, which equates to $2,352 per square foot based upon average unit size of 1,551 square feet. Among available units, monthly taxes average $811, or $0.52 per square foot, while monthly maintenance fees average $1,700, or $1.10 per square foot.

During 2014, the average closing price, for units averaging 1,397 square feet in size, was $2.73 million, which equates to an average per-square-foot price of $1,964. The following table summarizes this information.

TABLE 15 PLACE 57 SALES SUMMARY As of February 2015

Total Number of Units: 67 Developer: Clarett Group and Prudential Real Estate Investors

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #23A 3 beds 3 baths 1,551 $3,695,000 $2,382 $1,071 $0.69 $1,720 $1.11 #18A 3 beds 3 baths 1,551 $3,600,000 $2,321 $550 $0.35 $1,680 $1.08 Total / Wt. Avg 1,551 $3,647,500 $2,352 $811 $0.52 $1,700 $1.10

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

RECORDED SALES

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 11/26/2014 #21B 2 beds 2.5 baths 1,628 $3,000,000 $1,843 $807 $0.50 $1,747 $1.07 10/15/2014 #17A 3 beds 3 baths 1,551 $3,100,000 $1,999 $744 $0.48 $1,586 $1.02 8/14/2014 #9C - - - $1,850,000 - - - - - 7/9/2014 #4A 1 bed 1 bath 615 $969,030 $1,576 $305 $0.50 $652 $1.06 3/17/2014 #26A - - - $3,600,000 - - - - - 1/21/2014 #30A 3 beds 3 baths 1,795 $3,910,000 $2,178 $1,085 $0.60 $2,346 $1.31 2014 Total / Wt. Avg 1,397 $2,738,172 $1,964 $735 $0.53 $1,583 $1.13

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 9/13/2013 #9A10A - - - $1,900,000 - - - - - 9/12/2013 #16A 3 beds 3 baths 1,551 $3,000,000 $1,934 $692 $0.45 $1,540 $0.99 8/15/2013 #11B 2 beds 2.5 baths 1,628 $2,775,000 $1,705 $757 $0.46 $1,694 $1.04 8/5/2013 #3435B 3 beds 3 baths 2,439 $5,950,000 $2,440 $1,603 $0.66 $3,284 $1.35 7/10/2013 #15A 3 beds 3 baths 1,551 $2,390,000 $1,541 $696 $0.45 $1,542 $0.99 6/6/2013 #11A 3 beds 3 baths 1,551 $2,200,000 $1,418 $678 $0.44 $1,474 $0.95 4/11/2013 #8B 2 beds 2.5 baths 1,423 $1,725,000 $1,212 $469 $0.33 $1,295 $0.91 4/9/2013 #12A - - - $2,275,000 - - - - - 2/28/2013 #27B 2 beds 2.5 baths 1,628 $2,895,000 $1,778 $865 $0.53 $1,881 $1.16 2013 Total / Wt. Avg 1,682 $2,790,000 $1,779 $823 $0.49 $1,816 $1.08

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/21/2012 #15B 2 beds 2.5 baths 1,628 $2,455,000 $1,508 $735 $0.45 $1,613 $0.99 12/20/2012 #19A 3 beds 3 baths 1,551 $2,395,000 $1,544 $768 $0.50 $1,631 $1.05 11/19/2012 #23B 2 beds 2.5 baths 1,628 $2,650,000 $1,628 $816 $0.50 $1,792 $1.10 6/5/2012 #36PH - - - $1,791,213 - - - - - 4/5/2012 #30B 3 beds 3.5 baths 2,530 $7,750,000 $3,063 $1,133 $0.45 $3,825 $1.51 3/14/2012 #14A 3 beds 3 baths 1,551 $2,025,000 $1,306 $416 $0.27 $1,474 $0.95 2012 Total / Wt. Avg 1,778 $3,177,702 $1,909 $774 $0.44 $2,067 $1.16

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/22/2011 #24B 2 beds 2 baths 1,386 $2,300,000 $1,659 $197 $0.14 $1,356 $0.98 8/23/2011 #25A 2 beds 2.5 baths 1,628 $2,350,000 $1,443 - - - - 8/16/2011 #3C - - - $2,015,010 - - - - - 8/5/2011 #19B 3 beds 3 baths 1,551 $2,145,000 $1,383 $204 $0.13 $1,340 $0.86 7/19/2011 #5A6A - - - $2,650,000 - - - - - 6/17/2011 #22A 3 beds 3 baths 1,551 $2,388,000 $1,540 $223 $0.14 $1,535 $0.99 2011 Total / Wt. Avg 1,529 $2,308,002 $1,501 $208 $0.10 $1,410 $0.69

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

135 West 52nd Street is a condominium development that was recently completed. The building was developed by the Chetrit Group and Clipper Equity, and designed by CetraRuddy. The building’s façade is comprised of glass, steel, and a 40 story LED lighting fixture designed by the world-renowned lighting designer Thierry Dreyfus. Comprising 109 residential units, the 48 story building offers condominiums ranging from one to four bedrooms. The building also includes two duplexes and one triplex. The building lobby features a sculptural wall, and a curved display of artfully illuminated white onyx marble alongside a nickel frame.

The interior finishes feature five-inch-wide rift sawn white oak floors, and floor-to-ceiling insulated glass windows. The kitchen has all Miele appliances, walnut cabinetry by Dada, and Calacatta Vision polished marble countertops. The bathroom is finished in Siberian White marble on walls and floors with radiant heat and Watermark fittings. Amenities include a 12,000 foot private Residents’ Club Lounge, a pool, gym, children’s playroom, and a 24-hour doorman and concierge. While this location is in Midtown West, its positioning on 52nd Street offers some comparability with The Halcyon.

As of February 2015, there are 64 units listed at 135 West 52nd Street of which 56 are in contract. The average asking price among all units is $2.64 million, which equates to $1,592 per square foot based upon average unit size of 1,275 square feet. Among available units, monthly taxes average $1,592, or $1.25 per square foot, while monthly maintenance fees average $1,148, or $0.90 per square foot. Since launching sales in July 2014, the development has 56 units in contract indicating an absorption rate of about 7 units per month.

TABLE 16 135 WEST 52ND STREET SALES SUMMARY As of February 2015

Total Number of Units: 109 Developer: The Chetrit Group and Clipper Equity

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #37A 3 beds 3.5 baths 3,726 $8,700,000 $2,335 $5,258 $1.41 $3,756 $1.01 #PH4 3 beds 3.5 baths 2,601 $7,150,000 $2,749 $4,321 $1.66 $3,087 $1.19 #27A 4 beds 3.5 baths 2,227 $5,200,000 $2,335 $3,143 $1.41 $2,245 $1.01 #28B 3 beds 3.5 baths 2,232 $5,100,000 $2,285 $3,082 $1.38 $2,201 $0.99 #27B* 3 beds 3.5 baths 2,232 $5,000,000 $2,240 $3,021 $1.35 $2,458 $1.10 #20A 2 beds 3 baths 1,805 $4,075,000 $2,258 $2,463 $1.36 $1,759 $0.97 #18A* 2 beds 3 baths 1,805 $3,975,000 $2,202 $2,402 $1.33 $1,716 $0.95 #21B 2 beds 2.5 baths 1,642 $3,725,000 $2,269 $2,251 $1.37 $1,608 $0.98 #32C* 2 beds 2.5 baths 1,546 $3,600,000 $2,329 $2,176 $1.41 $1,554 $1.01 #32A* 2 beds 2.5 baths 1,540 $3,600,000 $2,338 $2,175 $1.41 $1,554 $1.01 #31A 2 beds 2.5 baths 1,540 $3,575,000 $2,321 $2,160 $1.40 $1,543 $1.00 #31C* 2 beds 2.5 baths 1,546 $3,525,000 $2,280 $2,160 $1.40 $1,543 $1.00 #30C* 2 beds 2.5 baths 1,546 $3,500,000 $2,264 $2,115 $1.37 $1,511 $0.98 #25B* 2 beds 2 baths 1,432 $3,165,000 $2,210 $1,913 $1.34 $1,366 $0.95 #25C* 2 beds 2 baths 1,432 $3,125,000 $2,182 $1,889 $1.32 $1,349 $0.94 #32B* 2 beds 2.5 baths 1,372 $3,100,000 $2,259 - - $1,576 $1.15 #31B 2 beds 2.5 baths 1,372 $3,095,000 $2,256 $1,843 $1.34 $1,317 $0.96 #23C* 2 beds 2 baths 1,432 $3,060,000 $2,137 $1,849 $1.29 $1,321 $0.92 #30B* 2 beds 2.5 baths 1,372 $3,045,000 $2,219 $1,840 $1.34 $1,315 $0.96 #23B* 2 beds 2 baths 1,432 $3,025,000 $2,112 $1,828 $1.28 $1,306 $0.91 #22C* 2 beds 2 baths 1,432 $2,975,000 $2,078 $1,798 $1.26 $1,284 $0.90 #25D* 2 beds 2 baths 1,194 $2,675,000 $2,240 $1,616 $1.35 $1,154 $0.97 #24A* 2 beds 2 baths 1,190 $2,630,000 $2,210 $1,589 $1.34 $1,135 $0.95 #24D* 2 beds 2 baths 1,194 $2,560,000 $2,144 $1,547 $1.30 $1,105 $0.93 #23A* 2 beds 2 baths 1,190 $2,560,000 $2,151 $1,547 $1.30 $1,105 $0.93 #23D* 2 beds 2 baths 1,194 $2,560,000 $2,144 $1,547 $1.30 $1,105 $0.93 #22D* 2 beds 2 baths 1,194 $2,530,000 $2,119 $1,511 $1.27 $1,079 $0.90 #22A* 2 beds 2 baths 1,190 $2,500,000 $2,101 $1,510 $1.27 $1,076 $0.90 #16E* 1 bed 2 baths 1,124 $2,135,000 $1,899 $1,290 $1.15 $922 $0.82 #15E* 1 bed 2 baths 1,124 $2,105,000 $1,873 $1,272 $1.13 $909 $0.81 #15B* 1 bed 2 baths 1,124 $2,085,000 $1,855 $1,281 $1.14 $915 $0.81 #14E* 1 bed 2 baths 1,124 $2,070,000 $1,842 $1,251 $1.11 $893 $0.79 #12B* 1 bed 2 baths 1,124 $2,025,000 $1,802 $1,224 $1.09 $874 $0.78 #11B* 1 bed 2 baths 1,124 $2,020,000 $1,797 $1,220 $1.09 $872 $0.78 #16F* 2 beds 2 baths 1,001 $2,000,000 $1,998 $1,208 $1.21 $863 $0.86 #10B* 1 bed 2 baths 1,124 $2,000,000 $1,779 $1,208 $1.07 $863 $0.77 #9B* 1 bed 2 baths 1,124 $1,995,000 $1,775 $1,197 $1.06 $855 $0.76 #11E* 1 bed 2 baths 1,124 $1,985,000 $1,766 $1,199 $1.07 $857 $0.76 #15F* 2 beds 2 baths 1,001 $1,980,000 $1,978 $1,196 $1.19 $855 $0.85 #10E* 1 bed 2 baths 1,124 $1,965,000 $1,748 $1,187 $1.06 $848 $0.75 #15A* 2 beds 2 baths 995 $1,960,000 $1,970 $1,184 $1.19 $848 $0.85 #14A* 2 beds 2 baths 995 $1,950,000 $1,960 $1,178 $1.18 $842 $0.85 #9E* 1 bed 2 baths 1,124 $1,945,000 $1,730 $1,175 $1.05 $840 $0.75 #14F* 2 beds 2 baths 1,001 $1,930,000 $1,928 $1,178 $1.18 $842 $0.84 #12A* 2 beds 2 baths 995 $1,920,000 $1,930 $1,160 $1.17 $829 $0.83 #11F* 2 beds 2 baths 1,001 $1,900,000 $1,898 $1,009 $1.01 $721 $0.72 #10F* 2 beds 2 baths 1,001 $1,880,000 $1,878 $1,136 $1.13 $811 $0.81 #9F* 2 beds 2 baths 1,001 $1,860,000 $1,858 $1,124 $1.12 $803 $0.80 #9A* 2 beds 2 baths 995 $1,860,000 $1,869 $1,124 $1.13 $803 $0.81 #10A* 2 beds 2 baths 995 $1,860,000 $1,869 $1,124 $1.13 $803 $0.81 #16C* 1 bed 2 baths 904 $1,670,000 $1,847 $1,009 $1.12 $721 $0.80 #16D* 1 bed 2 baths 904 $1,670,000 $1,847 $1,009 $1.12 $721 $0.80 #15D* 1 bed 2 baths 904 $1,650,000 $1,825 $997 $1.10 $712 $0.79 #14D* 1 bed 2 baths 904 $1,630,000 $1,803 $985 $1.09 $703 $0.78 #15C* 1 bed 2 baths 904 $1,630,000 $1,803 $985 $1.09 $704 $0.78 #14C* 1 bed 2 baths 904 $1,630,000 $1,803 $985 $1.09 $704 $0.78 #12C* 1 bed 2 baths 904 $1,610,000 $1,781 $973 $1.08 $695 $0.77 #12D* 1 bed 2 baths 904 $1,610,000 $1,781 $973 $1.08 $695 $0.77 #11C* 1 bed 2 baths 904 $1,590,000 $1,759 $961 $1.06 $686 $0.76 #10D* 1 bed 2 baths 904 $1,575,000 $1,742 $951 $1.05 $679 $0.75 #10C* 1 bed 2 baths 904 $1,575,000 $1,742 $952 $1.05 $680 $0.75 #11D* 1 bed 2 baths 904 $1,570,000 $1,737 $948 $1.05 $678 $0.75 #9D* 1 bed 2 baths 904 $1,560,000 $1,726 $942 $1.04 $673 $0.74 #9C* 1 bed 2 baths 904 $1,520,000 $1,681 $918 $1.02 $656 $0.73 Total / Wt. Avg 1,275 $2,644,531 $2,071 $1,592 $1.25 $1,148 $0.90

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

The Laurel located at 400 East 67th is a condominium complex that was built in 2005. The building was developed by the Alexico Group, and has a classic façade built of glass and limestone designed by the architects Costas Kondylis & Partners. Comprising 128 residential units, the 30-story building offers condominiums ranging from studios to four bedrooms.

The interior finishes feature 9 to 12 foot ceiling heights, solid white oak flooring, and in-swing casement windows. The kitchen has all Sub-Zero and Gaggenau appliances, marble countertops, and high-gloss white lacquer lower cabinets. The bathroom is finished in radiant heated white marble mosaic flooring, floor-to-ceiling white slab marble walls, and Zuma Collection tub along with Vola and Grohe appliances. Amenities include a private residents’ lounge area, a pool, a bi-level fitness and triathlon center, a 24-hour doorman, on-site parking, and concierge services. The Laurel is located in Lenox Hill on the southeast corner of First Avenue overlooking St. Catherine’s Park.

As of February 2015, there are 4 units listed at The Laurel of which one is in contract. The average asking price among all units is $2.91 million, which equates to $2,057 per square foot based upon average unit size of 1,417 square feet. Among available units, monthly taxes average $474, or $0.33 per square foot, while monthly maintenance fees average $1,507, or $1.13 per square foot. Furthermore, the building features 421-a tax abatement.

During 2014, the average closing price for units averaging 1,690 square feet in size was $3.23 million, which equates to an average per-square-foot price of $1,908. The following table summarizes this information.

TABLE 17 THE LAUREL SALES SUMMARY As of February 2015

Total Number of Units: 128 Developer: Alexico Group

ASKING PRICES

Unit Type BR Type BA SF Asking Price Asking PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF #PH31 3 beds 4.5 baths 4,073 $19,750,000 $4,849 $3,261 $0.80 $4,906 $1.20 #24B* 3 beds 3 baths 1,700 $3,600,000 $2,118 $571 $0.34 $1,847 $1.09 #11B 2 beds 2 baths 1,276 $2,595,000 $2,034 $419 $0.33 $1,386 $1.09 #9E 2 beds 2 baths 1,275 $2,550,000 $2,000 $432 $0.34 $1,289 $1.01 Total / Wt. Avg 1,417 $2,915,000 $2,057 $474 $0.33 $1,507 $1.13

*In Contract Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

TABLE 17 RECORDED SALES

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 10/22/2014 #20C 3 beds 3.5 baths - $3,450,000 - $630 - $1,976 - 10/7/2014 #7J 2 beds 2.5 baths 1,352 $2,500,000 $1,849 - - $1,290 $0.95 7/24/2014 #15C 3 beds 3.5 baths 1,773 $3,620,000 $2,042 $630 $0.36 $1,886 $1.06 7/10/2014 #15B - - - $3,050,000 - - - - - 6/30/2014 #12B 2 beds 3 baths 1,700 $3,225,000 $1,897 $574 $0.34 $1,718 $1.01 5/13/2014 #23B 3 beds 3 baths 1,700 $3,150,000 $1,853 $577 $0.34 $1,720 $1.01 5/13/2014 #4C 2 beds 3 baths 1,550 $2,600,000 $1,677 $526 $0.34 $1,567 $1.01 4/22/2014 #26B 3 beds 3.5 baths 1,964 $4,840,000 $2,464 $186 $0.09 $1,821 $0.93 4/10/2014 #4A 2 beds 2 baths 1,348 $1,868,500 $1,386 $468 $0.35 $1,363 $1.01 1/28/2014 #14C 3 beds 3 baths 2,136 $4,000,000 $1,873 $714 $0.33 $2,159 $1.01 2014 Total / Wt. Avg 1,690 $3,230,350 $1,908 $538 $0.27 $1,722 $1.00

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/31/2013 #22D 2 beds 2.5 baths 1,537 $2,800,000 $1,822 $144 $0.09 $1,425 $0.93 12/13/2013 #3G - - - $1,731,025 - - - - - 9/3/2013 #28B 3 beds 3.5 baths 1,964 $3,767,625 $1,918 $667 $0.34 $1,985 $1.01 7/24/2013 #28A 3 beds 3 baths 2,285 $5,400,000 $2,363 $213 $0.09 $2,310 $1.01 7/8/2013 #7F studio 1 bath 635 $745,715 $1,174 $60 $0.09 $642 $1.01 6/12/2013 #8E 2 beds 2 baths 1,275 $2,000,000 $1,569 $120 $0.09 $1,350 $1.06 6/10/2013 #3E studio 1 bath 635 $738,231 $1,163 $60 $0.09 $642 $1.01 5/31/2013 #8C - - - $1,950,000 - - - - - 5/8/2013 #6F studio 1 bath 635 $712,775 $1,122 $60 $0.09 $642 $1.01 5/8/2013 #6E studio 1 bath 646 $738,231 $1,143 $61 $0.09 $653 $1.01 5/3/2013 #3D studio 1 bath 646 $690,000 $1,068 - - $518 $0.80 4/19/2013 #6A studio 1 bath 496 $646,588 $1,304 $47 $0.09 $502 $1.01 3/15/2013 #4D studio 1 bath 646 $697,501 $1,080 $61 $0.09 $653 $1.01 3/11/2013 #5E studio 1 bath 646 $718,599 $1,112 $61 $0.09 $653 $1.01 3/11/2013 #5F studio 1 bath 635 $695,418 $1,095 $60 $0.09 $642 $1.01 2/27/2013 #7A studio 1 bath 500 $682,000 $1,364 $45 $0.09 $451 $0.90 2013 Total / Wt. Avg 942 $1,544,607 $1,596 $128 $0.13 $933 $0.99

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 12/28/2012 #16C 3 beds 3.5 baths 1,773 $2,800,187 $1,579 $168 $0.09 $1,792 $1.01 12/27/2012 #22C 3 beds 3.5 baths 1,773 $2,979,500 $1,680 $168 $0.09 $1,792 $1.01 12/4/2012 #24C 3 beds 3.5 baths 1,773 $3,105,662 $1,752 $168 $0.09 $1,792 $1.01 11/27/2012 #21C 3 beds 3.5 baths 1,773 $2,927,468 $1,651 $168 $0.09 $1,792 $1.01 11/1/2012 #23C 3 beds 3.5 baths 1,773 $3,044,750 $1,717 $168 $0.09 $1,792 $1.01 10/26/2012 #9F 2 beds 2.5 baths 1,418 $2,200,000 $1,551 $145 $0.10 $1,315 $0.93 10/5/2012 #19C 3 beds 3.5 baths 1,773 $2,825,643 $1,594 $168 $0.09 $1,792 $1.01 10/4/2012 #8F 2 beds 2.5 baths 1,418 $2,050,000 $1,446 $133 $0.09 $1,314 $0.93 8/16/2012 #11A 3 beds 3.5 baths 1,773 $2,862,809 $1,615 $166 $0.09 $1,644 $0.93 7/31/2012 #10F 3 beds 3 baths 1,700 $3,034,385 $1,785 $161 $0.09 $1,576 $0.93 7/18/2012 #22B 2 beds 2 baths 1,286 $2,225,000 $1,730 $122 $0.09 $1,155 $0.90 6/28/2012 #21B 3 beds 3.5 baths 1,964 $4,251,193 $2,165 $186 $0.09 $1,821 $0.93 6/20/2012 #3F - - - $1,975,000 - - - - - 6/18/2012 #25C 3 beds 3 baths 1,700 $2,952,925 $1,737 $161 $0.09 $1,576 $0.93 6/15/2012 #27B 3 beds 3 baths 1,700 $2,851,100 $1,677 $161 $0.09 $1,576 $0.93 5/18/2012 #20B 2 beds 3 baths 1,678 $1,934,675 $1,153 $159 $0.09 $1,556 $0.93 4/10/2012 #25B 3 beds 3 baths 2,285 $4,887,600 $2,139 $216 $0.09 $2,119 $0.93 2/29/2012 #11C 4 beds 3.5 baths 2,778 $5,666,375 $2,040 $263 $0.09 $2,576 $0.93 2/29/2012 #9C 3 beds 3.5 baths 1,964 $4,224,025 $2,151 $184 $0.09 $1,821 $0.93 2/29/2012 #5C 2 beds 3 baths 1,700 $2,807,431 $1,651 $161 $0.09 $1,576 $0.93 2/29/2012 #6H 3 beds 3.5 baths 1,964 $4,172,512 $2,124 $186 $0.09 $1,821 $0.93 2/29/2012 #10C 3 beds 3.5 baths 1,964 $4,121,000 $2,098 $186 $0.09 $1,821 $0.93 2/15/2012 #6J - - - $1,557,922 - - - - - 2/15/2012 #3C 1 bed 2 baths 1,153 $1,456,097 $1,263 $108 $0.09 $1,069 $0.93 2012 Total / Wt. Avg 1,777 $3,038,052 $1,775 $168 $0.09 $1,686 $0.95

Closed Date Unit Type BR Type BA SF Closed Price Closed PSF Taxes/Mo.Taxes/Mo. PSFMaint./Mo. Maint./Mo. PSF 10/20/2011 #12C 2 beds 2.5 baths 1,537 $2,818,006 $1,833 $144 $0.09 $1,425 $0.93 10/3/2011 #19B 2 beds 2.5 baths 1,282 $1,600,000 $1,248 $365 $0.28 $1,028 $0.80 9/12/2011 #PH31 1 bed 1.5 baths 904 $1,100,000 $1,217 $82 $0.09 $725 $0.80 9/12/2011 #7D 2 beds 2 baths 1,275 $1,629,200 $1,278 $120 $0.09 $1,182 $0.93 9/2/2011 #29B 1 bed 2 baths 1,153 $1,552,831 $1,347 $108 $0.09 $1,069 $0.93 8/30/2011 #4F 2 beds 2.5 baths 1,352 $1,580,000 $1,169 $122 $0.09 $1,084 $0.80 8/10/2011 #18B 2 beds 3 baths 1,550 $2,036,500 $1,314 $145 $0.09 $1,409 $0.91 7/29/2011 #27A 3 beds 3 baths 2,136 $3,258,400 $1,525 $204 $0.10 $1,975 $0.92 7/29/2011 #27C - - - $2,749,275 - - - - - 7/27/2011 #11F 4 beds 4.5 baths 4,073 $11,226,206 $2,756 $455 $0.11 $4,414 $1.08 7/20/2011 #5G - - - $1,822,667 - - - - - 6/17/2011 #16B 3 beds 3.5 baths 1,964 $4,225,737 $2,152 $184 $0.09 $1,786 $0.91 6/14/2011 #10E 3 beds 3 baths 1,678 $1,985,587 $1,183 $157 $0.09 $1,526 $0.91 5/16/2011 #7G 2 beds 2.5 baths 1,418 $1,832,850 $1,293 $133 $0.09 $1,289 $0.91 5/16/2011 #21A 3 beds 3 baths 1,700 $2,698,362 $1,587 $159 $0.09 $1,546 $0.91 5/16/2011 #23D 3 beds 3 baths 2,285 $4,785,775 $2,094 $214 $0.09 $2,077 $0.91 4/29/2011 #17B - - - $5,804,025 - - - - - 4/28/2011 #7C 2 beds 2.5 baths 1,418 $1,924,492 $1,357 $133 $0.09 $1,289 $0.91 4/13/2011 #20D 3 beds 3 baths 2,136 $3,156,575 $1,478 $200 $0.09 $1,942 $0.91 3/25/2011 #9B 3 beds 3 baths 1,677 $2,087,412 $1,245 $157 $0.09 $1,526 $0.91 3/23/2011 #5J 3 beds 3 baths 1,700 $2,596,537 $1,527 $154 $0.09 $1,363 $0.80 3/4/2011 #26C 2 beds 2 baths 1,275 $1,680,112 $1,318 $115 $0.09 $1,023 $0.80 3/1/2011 #28C 2 beds 3 baths 1,550 $2,087,412 $1,347 $145 $0.09 $1,409 $0.91 2011 Total / Wt. Avg 1,703 $2,879,911 $1,640 $175 $0.10 $1,554 $0.91

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

The Sutton located at 959 First Avenue is a condominium complex that will be completed in 2016. The building is being developed by Toll Brothers. Comprising 114 residential units, the 30-story building offers condominiums ranging from studios to four bedrooms with prices ranging from $850,000 to more than $6 million. Sales are expected to open sometime in early 2015.

Summary

The following table summarizes the sales since 2011 and recent availability at the comparable properties discussed in this analysis. Despite the locational and quality differences among the comparables, and versus the subject development, summarizing the transactions and availability this way assists in framing the market pricing for the condominiums at the Halcyon. We have taken these comparables into consideration in forming our conclusions related to the project’s marketability and achievable prices going forward.

TABLE 18

COMPARABLE PROPERTIES SUMMARY Available 2014 Sales 2013 Sales 2012 Sales 2011 Sales Property Listed Size Avg Sales Price Avg Psf Sales Size Avg Sales Price Avg Psf Sales Size Avg Sales Price Avg Psf Sales Size Avg Sales Price Avg Psf Sales Size Avg Sales Price Avg Psf The Veneto 8 1,170 $2,077,500 $1,822 14 1,224 $2,047,929 $1,673 13 1,200 $2,043,846 $1,569 12 1,543 $2,030,833 $1,474 11 1,461 $2,161,818 $1,453 Three Ten 10 1,971 $3,243,800 $1,646 4 1,739 $2,641,250 $1,519 9 1,761 $2,482,444 $1,473 9 1,691 $2,408,389 $1,455 1 2,333 $3,850,000 $1,650 The Alexander 2 831 $1,525,000 $1,835 4 1,285 $2,203,750 $1,716 5 1,372 $2,626,722 $1,696 11 1,209 $1,412,510 $1,276 33 943 $1,121,787 $1,190 252 East 57th Street 13 2,485 $7,512,308 $3,023 ------301 East 50th Street 34 1,498 $2,954,853 $1,973 ------Place 57 2 1,551 $3,647,500 $2,352 6 1,397 $2,738,172 $1,964 9 1,682 $2,790,000 $1,179 6 1,778 $3,177,702 $1,909 6 1,529 $2,308,002 $1,501 135 West 52nd Street 64 1,275 $2,644,531 $2,071 ------The Laurel 4 1,417 $2,915,000 $2,057 10 1,690 $3,230,350 $1,908 16 942 $1,544,607 $1,596 24 1,777 $3,038,052 $1,775 23 1,703 $2,879,911 $1,640

Source: Field Survey, Acris, and StreetEasy.com; Compiled by The Weitzman Group, Inc.

RETAIL MARKET OVERVIEW

Introduction

Since 2009, employment in New York’s retail sector has accelerated, adding more jobs to the City than any other industry, according to the State Department of Labor. Recent reports have shown that tourism and development have contributed significantly to Manhattan’s retail economy, helping drive the local economy out of recession. In 2014, the number of people visiting New York topped 56 million, increasing 10% since 2006. In particular, Turtle Bay is a dense residential neighborhood that does not attract tourists and the retail demand is primarily for service-oriented businesses.

The following discussion presents the highlights of our research related to the market for retail space at 305 East 51st Street.

RETAIL MARKET TRENDS

According to the 2014 Fall Real Estate Board of New York (REBNY) report, the average asking rents in most major retail areas of Manhattan have decreased slightly since the spring of 2014. The average asking rent for retail space in Manhattan fell by 10%, from $189 per square foot in the spring of 2014 to $170 per square foot in the fall of 2014. However, the average asking rent in the broad competitive area 305 East 51th Street, inclusive of Midtown from 35th Street to 59th Street has had strong growth with 4% growth over spring 2014 and a 24% increase over fall 2013. As such, 305 East 51th Street is well situated in Midtown to benefit from the robust growth of retail rents.

TABLE 19 AVERAGE ASKING RENTS IN MAJOR RETAIL NEIGHBORHOODS AS OF FALL 2014 ALL AVAILABLE SPACE (GROUND FLOOR, LOWER LEVEL, UPPER LEVEL, MEZZANINE)

% Change % Change Fall Spring Fall From Spring From Fall MANHATTAN 2014 2014 2013 2014 2013 $149 $139 $130 7% 15%

EASTSIDE $170 $189 $178 -10% -4% 60th St to 96th St, Fifth Ave to the East River

WESTSIDE $144 $145 $126 -1% 14% 60th St to 116th St, West of Morningside Park

MIDTOWN $198 $190 $160 4% 24% 35th St to 59th Street

MIDTOWN SOUTH $152 $136 $128 12% 19% 15th St to 34th Street

DOWNTOWN $135 $130 $123 4% 10% South of 14th Street

UPPER MANHATTAN $70 $65 $64 8% 9% 97th St and higher, Fifth Ave to the East River 116th St and higher, West of Morningside Park Source: REBNY Fall 2014 Report; compiled by The Weitzman Group, Inc.

According to REBNY, the economic forecast of New York City remains positive, with employment projected to continue to increase through 2015, and citing the City’s Office of Management and Budget in noting that the gross personal income is expected to escalate to $456,600 during the same time period.

The Fourth Quarter 2014 Retail Outlook by Jones Lang LaSalle has characterized New York as one of only three rising retail markets in the country, citing good infrastructure, strong leasing performance and promising demographics as factors that make the city a frontrunner for retail real estate growth. With the lowest vacancy rate and highest average rent, the report anticipates that New York will remain one of the tightest retail markets in the country. The market trends recorded by REBNY indicate a consensus on the increasing strength of the overall Manhattan retail market. While the asking rent for ground floor retail space is sensitive to a variety of location and physical factors, it remains relatively high within major retail corridors, indicating a continued demand for retail space at key locations.

LEASE COMPARABLES

Relevant Leasing Activity

The Weitzman Group has obtained numerous comparable lease terms for deals signed during 2013 and 2014 within the area surrounding 305 East 51st Street. In our opinion, the most comparable leases are those for relatively large ground level spaces on corner locations, situated east of Third Avenue. Larger spaces tend to lease for lower rents on a per square foot basis, while smaller spaces tend to rent for a premium. Tenants are generally interested in their total chunk rent on an annual basis relative to achievable sales, and thus, a small corner location with good visibility offers a relatively affordable business destination. Among those completed leases we have researched, the most comparable are as follows:

 985 Second Avenue leased 5,000 square feet to Bareburger, a food user, in the fourth quarter of 2014. Bareburger took an in-line space at the property, which is located at the northwest corner of East 52nd Street. The starting rent is $158 per square foot for the ground floor which measures 2,500 square feet.

 M&T Bank is a financial institution, which leased 2,300 square feet at 1032 Second Avenue between East 54th and East 55th Street, in the fourth quarter of 2014. All 2,300 square feet is located at ground level. The asking ground floor rent per square foot was $175, although the starting rent was negotiated.

 In the third quarter of 2014, Equinox renewed a multi-level lease on a total of 16,600 square feet at 250 East 54th Street between Second and Third Avenues. The aggregate starting rent was $1,300,000, which equates to $78 per square foot blended among all levels.

These leases serve to frame the market for the space availability at the subject property. The full list of select lease comparables is shown in the following table.

TABLE 20 SELECT COMPLETED COMPARABLE RETAIL LEASES

RECENTLY COMPLETED LEASE TRANSACTIONS THE HALCYON (305 EAST 51ST STREET) Aggregate Aggregate Qtr Yr Num Street Intersection Tenant Category Total GF LL Sub LL SF 2nd FL GF Ask PSF GF Est Actual Starting Rent Starting Rent PSF Term Comments 4 2014 985 Second Avenue N/W Corner of E. 52nd Street Bareburger Food / Bar 5,000 2,500 2,500 - - $175 $158 $396,000 $79 15 years - 4 2014 1032 Second Avenue Between E. 54th and E. 55th Street M&T Bank Financial Services 2,300 2,300 - - - $175 - $124,488 $54 - - 3 2014 250 East 54th Street Between Second and Third Avenues Equinox Health Clubs 16,600 6,100 7,166 5,500 - - - $1,300,000 $78 - Renewal

4 2012 885 Second Avenue Between E. 47th and E. 48th Street NEP Super Shooters Communications 13,500 ------$474,250 $35 - Renewal. Portion of the concourse. 1 2012 244 East 51st Street Between Second and Third Avenues Karlzma Lounge Food / Bar 2,400 ------

Tot / Avg. 7,960 Wt. Avg $158 Min $158 $124,488 Source: Compiled by The Wetizan Group, Inc. from multiple sources Max $158 $1,300,000

Source: Compiled by the Weitzman Group, Inc.

Currently Advertised Retail Space

While asking rents do not necessarily equate to taking rents on available retail space, The Weitzman Group has assembled an inventory of available retail space near 305 East 51st Street. It is not an exhaustive inventory, but provides further framing for the achievable rents at the project. More importantly, the availabilities indicate the direction that rents are trending. There are many retail spaces that are presently available, or were recently offered. Some have been leased, although the terms were not yet available to us. Similar to the actual completed lease comparables, the same characteristics among availabilities apply when considering the achievable rents at 305 East 51st Street. The following availabilities are most applicable to the project:

 240 East 54th Street – features 6,400 square feet at grade, and 10,000 square feet on the second level. The listing has 100 feet of frontage on East 54th Street. Annual asking rent is $1,120,000 or $68 per square foot. The property’s current tenant is ICon Parking and is available as net lease.

 891 First Avenue – the retail space features 2,800 square feet at grade, and an additional 500 square feet on the mezzanine level. The listing asks $160 per square foot and has 95 feet of wraparound frontage.

 944 Second Avenue – asking $235 per square foot for 6,259 square feet at grade. There is an additional 1,865 square feet at the lower level. The listing features 150 feet of wraparound frontage.

The most comparable availabilities appear to be seeking rents more aggressively for in-line space than have been achieved with real lease deals. The following table presents the sample of retail space availabilities we considered.

TABLE 21

RETAIL LEASE AVAILABILITIES THE HALCYON (305 EAST 51ST STREET) Annual Asking Rent Ceiling Property Floor SF Rent PSF Lease Type Ht Frontage Possession Current Tenant Comments Entire building is available for net lease, build to suit 240 East 54th Street Ground 6,400 - Direct 14' - - I-Con Parking and sale Second Level 10,000 14' Office, retail, community facility space Total 16,400 $1,120,000 Potential for roof top restaurant Soulcycle leased 3,600 SF Fully built out bar and lounge complete with new 306 East 49th Street Ground 1,875 n/a - Direct - 20' Immediate Vacant fixtures, kitchen equipment & electronics Lower Level 1,250 Bar and lounge uses welcome Cooking can only be accommodated via electric Total 3,125 stove Space is in excellent, move-in condition 883 First Avenue Ground 1,009 n/a - Direct - 20' Immediate Ze to Go - Ground 1,236 Total 2,245

891 First Avenue Mezzanine 500 Direct - 50' Immediate Vacant - Ground Level 2,800 $160 Total 3,300 $448,000

944 Second Avenue Ground 6,259 $235 Direct 18' 150' 1Q 2016 Vacant Reasonable divisions considered Lower Level 1,865 10' Total 8,124 $1,470,865

Source: Compiled by The Weitzman Group, Inc. from multiple sources

INVESTMENT SALES

The Weitzman Group has extensive experience with the investment parameters of retail property in Manhattan. Our prior experience indicates that there is likely to be a robust investor market for the leased (or unleased) retail condominium at the Halcyon project. The PwC Survey of Real Estate Investors, published as of the fourth quarter of 2014, indicates that overall capitalization rates underwritten on retail strip centers averaged 7.05% nationally, within a range of 5.0% to 10.0%. Certainly, the capitalization rates and demand for retail property in Manhattan has been more aggressive than the national average. Based upon our review of recent retail property transactions within a quarter mile from the Halcyon, we note that capitalization rates (where reported) ranged from 4.2% to 4.4%. Specifically, the retail condominium at 866 Third Avenue, comprising 16,630 net rentable square feet of space leased to Duane Reade, Wells Fargo and Chop’t, was refinanced in July 2014 assuming a 4.4% capitalization rate. Also, the retail condominium at 1009 Second Avenue, comprising 6,208 net rentable square feet on two floors, was sold in March 2014 at a 4.2% capitalization rate. Ultimately, we expect that the fully-leased retail condominium at the Halcyon should be underwritten at a similar going in capitalization rate.

CASH FLOW PROJECTIONS

METHODOLOGY

In order to project the Halcyon’s cash flows, one must make a number of assumptions related to the prices and sales pace of remaining condominium units, the other income that can be achieved, the potential sale proceeds from the sale of the retail condominium unit, and the reasonableness and distribution of remaining development costs. The major tasks involved in such an approach to projecting the Halcyon’s cash flows are enumerated as follows:

1. Determination of the condominium sale contracts written prior to December 31, 2014, and consideration of the likelihood that these units will close upon completion.

2. Estimation of the sale prices and pace of sales that will be achieved starting in January 2015 through the remainder of the sellout, as well as revenue from parking and storage sales.

3. Quantification of the development costs incurred prior to December 31, 2014, and the distribution of the remaining development budget, as deemed reasonable to complete the project.

4. Establishment of the reasonable rent level for the retail condominium, and projection of the first stabilized year’s income and expenses.

5. Determining a reasonable projection of net sale proceeds from the sale of the retail unit by applying an appropriate overall capitalization rate to the forecasted net operating income in the first stabilized year.

6. Derivation of the most probable net cash flow stream by subtracting all development costs from the net sale proceeds;

7. Determining the existing construction loan balance as of December 31, 2014 and projecting future construction draws and interest due through the payoff of the construction loan facility.

The result of this analysis provides a projected cash flow from the project, after construction debt service and loan repayment.

IMPORTANT CONSIDERATIONS

· The subject property has an excellent overall location for residential condominiums, and is nearing completion. This is likely to allow for strong sales activity given current market fundamentals, the relative value pricing of the building versus comparable properties in the market, and the ability of buyers and brokers to walk through the homes. There are 31 condominiums remaining available to sell as of December 31, 2014, with an average unit size of 1,672 square feet. Prior sales under contract total 92 units with an average unit size of 1,528 square feet.

- The retail condominium unit features a prominent corner and frontage on Second Avenue, and high ceilings. The lower level storage space, while not suitable for merchandising due to

approximately eight-foot ceiling heights, is a valuable retail storage space that would likely be included in the ground floor tenant’s lease.

- There is very little remaining construction risk as of December 31, 2014, and our review of the development budget remaining to complete the project indicates that the funds available appear adequate.

- As a result of the construction progress, the condominiums can reasonably be projected to be completed in the spring of 2015, and there is very little remaining development timing risk.

- The construction loan facility has an existing balance of approximately $71.3 million. While the interest rate increases (from 600 basis points over the 30-Day LIBOR rate a spread of 700 basis points) on any portion of the loan proceeds exceeding $95.0 million, we are projecting that the maximum loan balance will be approximately $90.3 million before being paid down rapidly by condominium sale proceeds. Thus, there is little capitalization risk remaining in the project as it relates to the construction loan only. We understand that there are other sources of capital, which we have not been asked to analyze as part of this study.

DEVELOPMENT BUDGET

The Weitzman Group obtained the development budget and loan draw request from the Developer of Halcyon, as of November 2014, which was the last construction loan draw completed prior to December 31, 2014. As of this loan draw request, the project had incurred a total of $65.8 million in hard costs, $21.2 million in soft costs, and $11.9 million in financing costs including $3.5 million in construction loan interest. Other financing costs included due diligence, fees, and oversight related to the capitalization of the project with construction and mezzanine debt. The land acquisition cost of $82.0 million had also been incurred prior to December 31, 2014. Based upon the actual 30-Day Libor rate of 0.154% in December 2014, we projected interest on the outstanding loan balance totaling $365,616 during that month. The remaining development budget as of December 31, 2014 was projected at $37.4 million, comprised primarily of hard costs totaling $33.5 million. The vast majority of financing costs not attributed to construction loan interest have been incurred as of December 31, 2014.

The following table summarizes the development expenses incurred through December 31, 2014, projected remaining costs, and the total project costs. While The Weitzman Group, Inc. is not a construction cost expert, and we cannot be relied upon to project costs, we believe that the remaining budget available to complete the project appears reasonable based upon our prior experience with similar projects. We have projected construction loan interest based upon our anticipated closing schedule of the condominiums, paydown of the loan, and an increase in the monthly LIBOR rate, increasing in January 2015 with the rate at 0.175%, and then increasing again in April 2015 at 0.185%. The applicable construction loan interest rate is 600 basis points over the monthly LIBOR rate.

TABLE 22

Source: Projections by The Weitzman Group, Inc.

Based upon our projections, we have assumed that the first mass closing of condominium units will occur in May 2015, and monthly thereafter as sections of the building are completed. All condominiums are projected to be sold and closed by the end of April 2016, with all remaining development costs also ceasing that month. The development costs incurred after the fall of 2015 are anticipated to be final finish and marketing costs, and are not substantial in aggregate. The construction loan is projected to be fully repaid in July of 2015.

ASSUMPTIONS UTILIZED IN DISCOUNTED CASH FLOW PROJECTIONS

The important underlying assumptions for the cash flow projections and valuation are summarized below:

1. Time Frame – Projecting project revenues and expenses forward from December 31, 2015, we have estimated a sixteen-month schedule for project completion and sellout, with the final residential unit sold in April 2016.

2. Residential Condominium Pricing – As of December 31, 2014, there were 92 residential condominiums under contract to be sold at an average price of $2,681,459, or $1,755 per square foot. We have assumed that all of these homes will ultimately close, due to the favorable contract prices and continuing strength of the condominium market. The remaining 31 residential condominiums include two penthouses, as well as a number of studio homes and rear-facing two- bedroom units that have proven challenging to sell. We note that while we are aware of the fact that several of these homes have been placed under contract after December 31, 2014, our analysis is retrospective to that date and we have considered the recent sales and pricing history only in the context of validating our projected pricing and absorption pace. We have priced each home individually based upon its floor plan and exposure, and supported by our market research. The following table summarizes the projected sale prices of remaining unsold residential condominiums as of December 31, 2014. The prices average $3,525,871 inclusive of both penthouses. This equates to an average of $2,109 per square foot.

TABLE 23

3. Residential Closing Schedule and Absorption – As previously noted, we believe that all units under contract will close. We have assumed that the first mass closing of units will occur in May 2015, with 20 closings, with the next month (June 2015) experiencing 10 closings, and alternating between 10 and 20 closings per month through November 2015. Beginning in December 2015, according to our projections, the pace of closings will be limited by the number of sales made that month. Based upon the prior sales history at Halcyon, the market appeal of the current availability, our projected prices for the remaining available units, and the fact that the project will be completed shortly, we have projected absorption of the remaining condominiums to occur at a typical pace of two units per month for fifteen months, with the final unit sold in month 16.

4. Parking Sales – There are up to 28 parking spaces allowable at the project, but physical limitations prevent more than 20 cars from being accommodated, according to the Developer. This assumptions utilizes stackers, which are included in the development budget. The Developer has not begun marketing any parking assets, although we believe the most viable use of the garage condominium unit is for its sale to 20 parking license holders of stackable parking spaces. Based upon our prior experience analyzing parking sales within condominium buildings, and our understanding of the Halcyon project, we have assumed that parking licenses will be sold at a price of $200,000 per license over a three-month period from November 2015 to January 2016. It is likely that the licenses will be sold to purchasers in the building. Total revenue from parking sales is projected at $4,000,000, and because these spaces are offered after condominium sales under contract, we have assumed that they are not subject to commissions or other closing costs.

5. Storage Cage Sales – There are 50 resident storage cages. We have assumed that all 50 cages will be sold to residents at an average price of $30,000. All cages are projected to be sold over a period of nine months, resulting in total revenue of $1,500,000.

5. Retail Condominium Sale – The retail condominium unit features 6,677 square feet of net leasable space on the ground floor, and 1,676 square feet of below grade storage space. Based upon our market research, we have assumed that the ground floor space will lease to a tenant at a starting rate of $175 per square foot, inclusive of use of the storage space. The storage area cannot be merchandised due to its ceiling heights of approximately eight feet. We have assumed that the base rent will increase by 3.0% annually throughout a ten-year term, and that there will be a $50 per square foot leasing incentive, comprising a combination of free rent and tenant improvements beyond the Developer’s white-box delivery. We have also assumed the stipulated condominium maintenance fees of $63,673 and real estate taxes of $70,331 in the first stabilized year, pursuant to the offering plan. Additional operating expenses of $10,000 have also been assumed. Based upon our projections, the net operating income is $1,024,271 in the first stabilized year. The following table summarizes this projection.

TABLE 24

We have assumed a 4.5% capitalization rate on the sale of the retail condominium. This is based upon our research into the retail investment sales market in Manhattan, and our prior experience working on similar assets. Based upon this capitalization rate, a reasonable sale price is projected at $22,766,020. We have projected that leasing commissions will be calculated at 5.0% of the annual rent for the first two years 4.0% of the rent for years 3 and 4, 3.0% of the annual rent for years 5 and 6, and 2.5% thereafter. In total, the leasing commissions are projected to be $445,277. Sales commissions are projected at 2.0% of the sale price, and equate to $455,320. After all costs, the net revenue from retail sales is projected at $21,521,572.

6. Development Cost – As previously discussed, we project that remaining development costs will total $37,440,687 with an additional $2,535,169 in financing costs (primarily construction loan interest).

Based upon our projections, the net cash flow after construction debt service and loan paydown is $144.2 million. The following table summarizes this projection, while the subsequent tables detail the monthly forecast of revenue and costs for the project.

TABLE 25

TABLE 26

CONCLUSION

It is the opinion of The Weitzman Group, Inc. that the Halcyon is a marketable development that ought to be completed and sold out in a timely fashion. We have neither a reason to believe that construction costs or timing is likely to exceed projections, nor do we have any concern related to the marketability of the condominium units or retail component at the prices and rents we have projected in our underwriting. There are just 31 residential units remaining to be sold as of December 31, 2014, and we have priced these in a way that will facilitate a reasonable, orderly sellout. The accessory parking and storage uses ought to be readily marketable. The retail condominium has excellent exposure on Second Avenue, and a corner location, and we expect that it will be leased and sold within a reasonable timeframe. There remains very little construction or timing risk related to the construction effort necessary to complete the project so that residential unit sales closings can occur. Overall, we have projected that there will be over $144 million in net cash flow available from the project after repayment of the construction loan.

Please contact us if you have any questions related to our analysis.

ADDENDA

THE WEITZMAN GROUP, INC. Real Estate Consultants

EXHIBIT A

BASIC ASSUMPTIONS AND LIMITING CONDITIONS

This report has been solely prepared for the client identified in the letter of transmittal and throughout the report. It is to be expressly utilized by the client for the purposes so stated, and no reliance is to be placed on this report for any other purposes. This report may not be utilized in conjunction with any securitized transaction without the express permission of The Weitzman Group, Inc. The rights to any information contained in this report, unless furnished by outside sources, are exclusively those of The Weitzman Group, Inc. This report must be read in its entirety and neither all nor portions of this report may be reproduced, published or shown to other parties without the express written authorization of The Weitzman Group, Inc.

The date to which the opinions expressed in this report apply is set forth in the letter of transmittal. The signatories assume no responsibility for economic or physical factors occurring at some later date, which may affect the opinions herein stated. Any aberrations and/or dramatic changes of prevailing economic conditions as of the date of analysis may impact our conclusions. While our opinions are as of December 31, 2014, we have included data in this study from a time period between January and February 2015. This is included only for reference purposes in order to validate our opinions as of December 2014.

No opinion is intended to be expressed for legal matters or those that would require specialized investigation or knowledge beyond that ordinarily employed by the real estate profession, although such matters may be discussed in the report. It is beyond The Weitzman Group’s area of expertise to estimate construction costs, and while we have reviewed the development budget provided by the Developer and believe it is reasonable, our opinion related to the appropriateness of the specific costs cannot be relied upon. A construction cost expert should be engaged to provide any critique or detailed review and opinions related to the development budget.

Data relative to the size of the units were taken from sources considered reliable. Maps, plats, graphics and exhibits if included herein, are for illustration purposes only, as an aid in visualizing matters discussed within the report. They should not be considered as surveys or relied upon for any other purpose.

The signatories of this report represent that they have no current or contemplated interest in any properties within the market study area covered by this report.

The rendering of this report does not presume the right of expert testimony or attendance in court or at any other hearing, unless financial, scheduling and other arrangements are made therefore a reasonable time in advance by mutual written agreement. Such arrangements have been made. All fees and costs (at the customary rates charged by The Weitzman Group, Inc. for litigation and non-litigation services) for any such attendance or other participation as an expert or in court, at any hearing or in connection with any discovery related to this report or the services provided by The Weitzman Group, Inc. hereunder shall be paid by the client herein identified if and to the extent same shall not be fully paid by any other person or entity.

Disclosure of the contents of this market study report and/or its use is governed by the Bylaws and Regulations of the Appraisal Institute. Neither all nor any part of the contents of this report especially any conclusions, the identity of the consultants or firm with which they are connected, or any reference to the Appraisal Institute or the MAI designation shall be disseminated to the public through advertising media, public relations media, sales media, news media, or any other public means of communication without the prior written consent and approval of the consultants. As previously mentioned, this document may not be utilized for any reporting in conjunction with a securitization transaction without the express written permission of The Weitzman Group, Inc.

This report constitutes a complete report, transmitted in summary report format and complies with The Uniform Standards of Professional Practice of The Appraisal Foundation for a complete report. This study has been prepared in conformity with and subject to the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute. As a summary report, this report does not include full discussions of the data, reasoning, and analyses that were used in the study’s process to develop the consultant’s opinions. Full documentation has been retained in our files.

The analysis was conducted by Marilyn K. Weitzman, Peter T. Bazeli, and Ali Raza. Our research in support of the study was completed in February 2015. We have relied on information relative to the project as supplied by the Developer, and have assumed such information to be correct.

EXHIBIT B

CERTIFICATION OF CONSULTANTS

We hereby certify that The Weitzman Group, Inc. was engaged to undertake a retail and residential marketability study and cash flow projection for the Halcyon condominiums at 305 East 51st Street in Manhattan.

Neither The Weitzman Group, Inc. nor we have any present or contemplated future interest in the real estate in any of the markets that have been analyzed in this report.

We have no personal interest or bias with respect to the subject matter of the report or the parties involved.

To the best of our knowledge and belief the statements of fact contained in this marketability study, upon which the analyses, opinions and conclusions expressed herein are based, are true and correct.

This marketability study report sets forth all of the limiting conditions (imposed by the terms of our assignment or by the undersigned) affecting the analysis, opinions and conclusions contained in this report.

The marketability analysis was conducted by Marilyn K. Weitzman, Peter T. Bazeli, and Ali Raza. Our research in support of the marketability study was completed in February 2015.

Our fee for this marketability analysis is not contingent upon the conclusions reported or upon anything else other than the delivery of this report.

This marketability analysis and its addenda has been made in conformity with and is subject to the requirements of The Uniform Standards of Professional Practice of The Appraisal Foundation. It is also subject to the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute.

The Appraisal Institute conducts a program of continuing education for its designated members. Members who meet the minimum standards of this program are awarded periodic educational certification. As of the date of this report, Marilyn Kramer Weitzman has completed the requirements under the continuing educational program of the Appraisal Institute.

THE WEITZMAN GROUP, INC.

Marilyn K. Weitzman, MAI, CRE, FRICS Peter T. Bazeli, MRICS President Senior Vice President

Ali Raza Associate

- EXHIBIT D -

QUALIFICATIONS OF THE CONSULTANTS

PROFESSIONAL QUALIFICATIONS

MARILYN KRAMER WEITZMAN, MAI, CRE, FRICS

EDUCATION: B.A., University of Pennsylvania

M.A., University of Pennsylvania Graduate School of Arts and Sciences

M.B.A., New York University Graduate School of Business Administration Beta Gamma Kappa Honor Society Specialization in Finance

New York University Real Estate Institute Courses in Advanced Real Estate Finance and Case Studies in Investment Analysis

EMPLOYMENT: THE WEITZMAN GROUP, INC., New York, NY 1981 Real Estate Consultants to Present

President Real estate specialists, providing advice and counsel to those engaged in evaluation, buying, selling, leasing, financing, or developing real estate. The services provided by the firm include acquisition and disposition counseling, regional economic analysis, market research, due diligence, development planning, appraisals and expert testimony.

KORPACZ & WEITZMAN, INC., New York, NY Real Estate Consultants and Appraisers

Principal Real estate consultants and appraisers providing market analyses, investment analyses, and property valuation services.

LANDAUER ASSOCIATES, INC., New York, NY

Assistant Vice President of Investment Services Division General real estate consulting including investment analysis, appraisals, feasibility studies and cash flow studies.

AMERICAN CITY CORPORATION, Hartford, CT Subsidiary of The Rouse Company

Regional Economist Responsible for aspects of regional planning and market analysis relating to the acquisition of new community sites. Page One

PROFESSIONAL QUALIFICATIONS

MARILYN KRAMER WEITZMAN, MAI, CRE, FRICS

LEON H. KEYSERLING, Washington, DC Consulting Economist and Attorney

Junior Economist Responsible for the collection and analysis of data from government sources and private clients.

MEMBER: Appraisal Institute – MAI (past Vice-Chairman, Education Committee) Counselors of Real Estate (past National Vice-President) Urban Land Institute (ULI) The Real Estate Board of New York, Inc. Commercial Real Estate Women (CREW) Association of Real Estate Women (AREW Past President) Licensed Real Estate Salesperson – New York State

LECTURER: Ingredients and Functions of a Market Study, a seminar sponsored by the New York Chapter of the American Institute of Real Estate Appraisers.

Real Estate Marketability and Investment Feasibility Analysis, a seminar presented for the Real Estate Department of Manufacturers Hanover Trust Company.

Apartment Project Marketability and Investment Feasibility Studies, a seminar presented for the Long Island Chapter of The Society of Real Estate Appraisers.

Residential Development – Marketability and Investment Feasibility Studies, a seminar sponsored by the University of Massachusetts at Sturbridge, Massachusetts.

Feasibility Analysis before the International S.R.E.A. conference in Atlanta.

Guest Lecturer at the Real Estate Institute of New York University on economic base studies, market analysis and appraisal.

ADJUNCT PROFESSOR: The Real Estate Institute of New York University. Courses include Real Estate Research: Market Analysis and Feasibility Studies; Advanced Applications in Appraisal.

Page Two

PROFESSIONAL QUALIFICATIONS

PETER T. BAZELI, MRICS

EDUCATION: Bradley University 1998 Foster College of Business Administration Peoria, Illinois Bachelor of Science degree Concentration in Marketing

EMPLOYMENT:

THE WEITZMAN GROUP, INC. New York, New York Real Estate specialists providing advice and counsel to those engaged in evaluating, buying, selling, leasing, financing, or developing real estate.

Senior Vice President October 2004 - Present

DRAPER AND KRAMER, INCORPORATED Chicago, Illinois Privately-held real estate firm engaged in the acquisition, financing, development, and management of commercial and residential property nationwide.

Assistant Vice President 2000-2004 Responsibilities within the Development Group aiding in the acquisition, financing, development, and marketing of large-scale residential properties in Chicago, Miami and Boston.

Retail Leasing Broker 2000 Provided retail leasing and brokerage services on a portfolio totaling more than 1 million square feet.

Senior Research Analyst 1998-2000 Performed market feasibility, underwriting, and general real estate analysis services for the firm and its clients.

MEMBERSHIP: Urban Land Institute Member, Royal Institute of Chartered Surveyors (MRICS Designation) Guest Lecturer – NYU Schack Institute of Real Estate, Northwestern University, Taubman College of Architecture and Urban Planning at the University of Michigan, Furman University Executive Lecture Series, Bradley University.

PROFESSIONAL QUALIFICATIONS

ALI RAZA

EDUCATION:

B.A. Finance 2013 Fordham University New York, NY

EMPLOYMENT:

THE WEITZMAN GROUP, INC., New York, NY Associate Jan. 2015-Present Real Estate specialists providing advice and counsel to those engaged in evaluating, buying, selling, leasing, financing, or developing real estate.

OPPENHEIMER & CO. INC, New York, NY Analyst Nov. 2013- Jan 2015 Public Finance division, which offers various municipal debt services to public and private clients.

RBC CAPITAL MARKETS Analyst Jun. 2012-Aug. 2013 Mortgage backed securities proprietary trading group, which invests RBC’s private capital.

COMMUNITY ACTIVITIES:

BOXING COMMUNITY OUTREACH PROGRAM Founder 2009-Present Teach inner-city high school students boxing and more importantly its principals of discipline and willpower.

ניתוח החזר השקעה צפוי בקשר עם פרויקט East 51st 303, מנהטן, ניו יורק

מרץ 2015 פרייסווטרהאוסקופרס ייעוץ בע"מ מגדל הסחר, המרד 25 תל אביב 68125 ת.ד. 452 תל אביב 61003 טלפון 03-7954588 פקס 03-7954789

תל אביב, 29 במרץ, 2015 לכבוד מר אייל ביגון פולאר השקעות בע"מ

א.ג.נ, הנדון: ניתוח החזר השקעה צפוי בקשר עם פרויקט East 51st 303, מנהטן, ניו יורק .PwC Israel”) PwC Advisory Ltd“) נתבקשה על ידיכם, פולאר השקעות בע"מ ("פולאר" או "החברה") לבצע ניתוח החזר השקעה צפוי ("הניתוח הפיננסי") בקשר עם פרויקט נדל"ן אשר ממוקם בכתובת East 51st 303, מנהטן, ניו יורק ("פרויקט 51" או "הפרויקט") ליום 31 בדצמבר 2014 ("מועד הניתוח"). עבודה זו נערכה בהתאם לתנאים המפורטים במכתב ההתקשרות בינינו מיום 12 במרץ, 2015. כל ייעוץ שיינתן או מסמך סופי מאתנו מועברים לשימושכם אך ורק בקשר למטרת העבודה שסופקה. פרט לדרישה על פי דין, לא תעבירו את העבודה לשום צד שלישי, או תאזכרו את עבודתנו, ללא הסכמתנו מראש ובכתב, אשר נעניק או נימנע מלהעניק או נתנה בתנאים, בהתאם לשיקול דעתנו, והכול תוך מתן סיבה, זאת למעט לרואי החשבון המבקרים של פולאר ובדיווחים הציבוריים של פולאר. בשום מקרה, בין אם ניתנה הסכמה או לא, לא נהיה אחראים כלפי צד שלישי אליו הועברה חוות דעתנו.

הניתוח הפיננסי מבוסס על נתונים ומקורות מידע, שכללו את תוצאות הפרויקט העתידיות (הכנסות, הוצאות, רווח, תזרים מזומנים) שהוכנו על ידי יועץ חיצוני, פירוט ההשקעות בפרויקט ומועדי ההשקעה, ההסכם המקורי אשר נחתם בחודש ינואר 2012 והתיקון לחוזה המקורי אשר נחתם בחודש דצמבר 2012 (כמוגדר להלן), הנחות שנתקבלו מהנהלת פולאר, פגישות ושיחות עם הנהלת פולאר, והסברים בע"פ שנתקבלו מהנהלת פולאר (הכול ביחד "המידע"). תוצאות הפרויקט העתידיות כפי שהוכנו על ידי יועץ חיצוני לא נבדקו על ידינו ואין אנו מחווים דעה עליהן. כמו כן, פירוט ההשקעות בפרויקט ומועדי ההשקעה בפרויקט והנחות הנהלת פולאר לא נבדקו על ידינו ואין אנו מחווים דעה עליהן. שינוי בתוצאות הפרויקט העתידיות ו/או בסכומי ההשקעה בפרויקט ו/או מועדי ההשקעה בפרויקט ו/או הנחות הנהלת פולאר יביא לשינוי שיכול להיות מהותי בסכום תזרימי המזומנים הצפויים מהפרויקט ו/או בחלוקת תזרימי המזומנים בין השותפים בפרויקט. ניתוח החזר ההשקעה הצפוי מבוסס על תנאי ההסכם המקורי והתיקון לחוזה המקורי. ניתוח החזר ההשקעה הצפוי אינו מהווה בדיקת נאותות משפטית של ההסכם המקורי והתיקון להסכם המקורי ואינו מהווה פרשנות משפטית של תנאי ההסכם המקורי והתיקון לחוזה המקורי. יודגש כי אין כל וודאות כי ניתוח החזר ההשקעה הצפוי כפי שמופיע במסמך זה יתקבל על ידי השותפים האחרים בפרויקט וכי הפרשנות של השותפים האחרים בפרויקט לתנאי החוזה המקורי והתיקון לחוזה המקורי לא תהא אחרת מהניתוח המוצג במסמך זה, כך שחלוקת תזרימי המזומנים מהפרויקט תהיה שונה באופן מהותי מהמוצג במסמך זה. המידע שנתקבל מהחברה לא אומת על ידינו באופן בלתי תלוי, ואין אנו מביעים חוות דעת או כל המלצה אחרת בדבר הנכונות או הנאותות של המידע האמור. עבודתנו לא תחשב ולא תהווה אישור, לשלמותם, נכונותם או דיוקם של הנתונים, המידע, התחזיות, ההסברים והמצגים שסופקו לנו. למרות שבמהלך עבודתנו ניתחנו מידע פיננסי וחשבונאי, עבודתנו לא כללה ביקורת של פולאר על פי כללי ביקורת מקובלים. לפיכך, אין אנו נוטלים אחריות או מחווים דעה בנוגע לאמינות, לדיוק ולרלוונטיות של המידע שסופק לנו על-ידי פולאר או מי מטעמה. בשום מקרה לא נהיה אחראים לכל הפסד, נזק, עלות או הוצאה אשר ייגרמו בכל אופן ודרך ממעשי הונאה, מצג שווא, הטעיה, מסירת מידע שאינו נכון ואינו מלא או מניעת מידע מצידן של פולאר ו/או מי מטעמה, או מכל התבססות אחרת על מידע כאמור. ככלל, תחזיות מתייחסות למאורעות עתידיים ומתבססות על הנחות סבירות ליום התחזית. הנחות אלו עשויות להשתנות במשך תקופת התחזית, ועל כן תחזיות אשר נערכו ליום ההערכה עשויות להיבדל מהתוצאות הפיננסיות בפועל ו/או מהערכות שתעשנה במועד מאוחר יותר. לפיכך, לא ניתן להתייחס לתחזיות שנערכו ברמת הביטחון המיוחסת לנתוני דוחות כספיים מבוקרים, ולפיכך אין אנו מחווים דעה באשר להתאמת התחזיות שנערכו על ידי היועץ החיצוני לתוצאות הפיננסיות של הפרויקט שתתקבלנה בפועל.

ברצוננו לציין, כי אין לנו עניין אישי בניירות הערך של פולאר. הננו בלתי תלויים בחברה כמשמעותו של מונח זה בחוק רואי חשבון תשט"ו1955- ובתקנות שהותקנו על פיו, לרבות תקנות רואי חשבון (ניגוד עניינים ופגיעה באי תלות כתוצאה מעיסוק אחר) (הוראת שעה), התשס"ג 2003, בתקני ביקורת ובכללי ההתנהגות המקצועית של לשכת רואי חשבון בישראל ובהתאם להחלטת רשות לניירות ערך (בנושא אי תלות) לפי סעיף 9ב' לחוק ניירות ערך, התשכ"ח 1968. נציין כי שכר טרחתנו אינו תלוי בתוצאות הניתוח. הניתוח הפיננסי מיועד לצורך המתואר במכתב ההתקשרות בינינו מיום 12 במרץ 2015, ואין לעשות בו כל שימוש אחר, או לצטטה, בשלמותה או בחלקה, בלא קבלת רשות מפורשת, בראש ובכתב, מ- PwC Israel. מוסכם בין PwC Israel ופולאר כי פרט למקרה בו ייקבע ע"י בית משפט כי PwC Israel פעלה ברשלנות רבתי ו/או בזדון, לא תישא PwC Israel בכל אחריות כלפי פולאר, מכל מקור שהוא ועל פי כל עילה שהיא, לרבות בנזיקין, בכל הקשור לביצוע שירותים על פי הצעה זו, ולא תהיה לחברה או למי מטעמה כל טענה ו/או תביעה כלפי PwC Israel, לרבות בדרך של הודעת צד שלישי, בכל הקשור לשירותים הניתנים בהתקשרות ובשירותים המוענקים על ידי PwC Israel לפולאר. אם ניתבע בהליך משפטי או בהליך אחר לשלם סכום כלשהו לצד שלישי בקשר עם ביצוע השירותים המפורטים במסמך זה, מתחייבת פולאר לשאת בכל ההוצאות הסבירות שנוציא או שנידרש לשלם עבור ייעוץ וייצוג משפטי, חוות דעת מומחים, התגוננות מפני הליכים משפטיים, משא ומתן וכיו"ב בקשר לכל תביעה, דרישה או הליכים אחרים בשל השירותים על פי מכתב זה, מיד עם דרישתנו הראשונה.

בנוסף ומבלי לפגוע בכלליות האמור לעיל, באם נחויב לשלם סכום כלשהו לצד שלישי בקשר עם ביצוע השירותים המפורטים במכתב זה, בהליך משפטי או בהליך מחייב אחר, מתחייבת פולאר לשפותנו בגין כל סכום כאמור שישולם על ידינו, במקרה בו לא פעלנו ברשלנות רבתי ו/או בזדון מייד עם דרישתנו הראשונה.

להלן נתונים נוספים הקשורים לניתוח הפיננסי שבוצע פרטי ההתקשרות מזמיני העבודה הינה חברת פולאר השקעות בע"מ. מועד ההתקשרות בין PwC Israel לפולאר הינו 12 במרץ, 2015. פרטי המעריך וניסיונו המקצועי העבודה בוצעה על-ידי צוות בראשותו של שלום סופר, רו"ח, שותף בקסלמן וקסלמן PricewaterhouseCoopers, ומומחה במימון והערכות שווי. מר סופר הינו בעל תואר ראשון בחשבונאות וכלכלה בהצטיינות ותואר שני בכלכלה בהצטיינות, שניהם מאוניברסיטת ת"א.

בכל שאלה ועניין, ניתן לפנות לשלום סופר, רו"ח, בטלפון 03-7954946.

תוכן עניינים

פרק עמוד

1 מבוא 1

2 ניתוח פיננסי 3

נספחים

1 הגבלת אחריות 9 פרק 1 מבוא

פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 1 פרק 1 – מבוא מבוא

• בחודש ינואר 2012, נחתם הסכם ("ההסכם המקורי") בין East 51st Street • ליום 31 בדצמבר 2014 הוכנו על ידי יועץ חיצוני תחזיות פיננסיות של תוצאות Associates LP 303 ("השותפות") ובין CIM, קרן נדל"ן אמריקאית, להשקעה פרויקט 51 (הכנסות, הוצאות, רווח צפוי ותזרימי מזומנים צפויים מהפרויקט). בפרויקט 51 (ביחד "השותפים"). • על בסיס תוצאות הפרויקט החזויות שהוכנו על ידי יועץ חיצוני, פירוט סכומי • בהסכם המקורי, CIM התחייבה להשקיע סכום של עד 85.2 מיליוני דולרים ההשקעה בפרויקט ומועדי ההשקעה על ידי השותפים השונים בפרויקט, הנחות לשם השלמת פרויקט 51 ("ההשקעה הראשונית של CIM"). השותפות לא פולאר בנוגע למועדי החלוקה הצפויים והנחות נוספות כפי שנתקבלו מהנהלת מחויבת תחת ההסכם המקורי להשקיע סכום נוסף כלשהו בהקשר לפרויקט 51 פולאר, תנאי ההסכם המקורי ותנאי התיקון להסכם, חושבה על ידינו חלוקת מעבר להשקעה הראשונית בפרויקט בסך של 18 מיליוני דולרים. תזרימי המזומנים הצפויים בין השותפים לפרויקט ליום 31 בדצמבר 2014. • בחודש מרץ 2012, נסגרו סופית תנאי ההסכם המקורי ואושרו על ידי הצדדים. • בחודש דצמבר 2012, נוסף להסכם המקורי בין השותפות לבין CIM תיקון ("התיקון להסכם"). בתיקון להסכם, CIM הסכימה להשקיע 5.9 מיליוני דולרים נוספים ("ההשקעה הנוספת של CIM") (סך הכל 91.1 מיליוני דולרים כולל ההשקעה הראשונית של CIM). וחלוקת תזרימי המזומנים בין השותפים שונתה כך שההשקעה הנוספת של CIM תניב תשואה מצטברת של 18%.

פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 2 פרק 2 ניתוח פיננסי

פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 3 פרק 2 – ניתוח פיננסי ניתוח פיננסי תזרימי המזומנים של פרויקט 51 כפי שנתקבלו מהיועץ החיצוני*

דולרים הכנסות תמורה ממכירת דירות, ברוטו 355,996,250 פחות - עלויות סגירה ועמלות (17,916,418) הכנסות ממכירת חניות 4,000,000 הכנסות ממכירת שטחי אחסון 1,500,000 הכנסות ממכירת שטחי מסחר 22,766,020 פחות - עלויות סגירה ועמלות (1,244,447) מכירות נטו 365,101,404

עלויות פיתוח רכישת קרקע 82,000,000 עלויות ישירות 99,292,693 עלויות עקיפות 25,146,033 סך הכל עלויות פיתוח 206,438,726

תזרים מזומנים לפני שירות החוב 158,662,679

הוצאות מימון, ללא הלוואת בנייה 8,453,651 הלוואת בנייה 6,015,272 סך הכל הוצאות מימון 14,468,923

תזרים מזומנים כולל שירות החוב 144,193,756

* תחזיות אלו לא נבדקו על ידינו ואין אנו מחווים את דעתנו עליהן. פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 4 פרק 2 – ניתוח פיננסי ניתוח פיננסי תמצית ההסכם והתיקון להסכם – תנאי החלוקה

• לפי תנאי התיקון להסכם המקורי, חלוקת הרווחים מתבצע לפי שכבות, אשר את ה-CIM Tier 2 Amount, ו-(2) אם סעיף (1) לסעיף זה תקף ולאחר נקבעות בהתאם לסעיפים 5.1.1, 5.1.2, 5.1.3, 5.1.4, 5.1.5, 5.1.6 ו5.1.7-: מכן השותפות מקבלת את ה-IRR אשר מתואר ב-(ב) מבלי ש-CIM תקבל את ה-Tier2 Amount CIM, הרווחים ימשיכו להיות מחולקים ל-CIM עד - סעיף A) – 5.1.1) ישולם לשותפות עבור Superpriority Additional שהסכום המצטבר של החלוקות הללו יהיו שוות ל-CIM Tier2 Amount. Capital Contributions ו/או Required Capital Shortfall Contributions עד שהשותפות קיבלה IRR 25% על השקעה זו. (B) - סעיף 5.1.4 – (א) 75% לשותפות ו-(ב) 25% ל-CIM, עד שגם: (1) אם ישולם ל-CIM אם ביצעה Discretionary Capital Contributions וגם/או השותפות ביצעה Discretionary Capital Contributions וגם/או Discretionary Capital Shortfall Distributions, עד ש-CIM קיבלה Discretionary Capital Shortfall Distributions, השותפות קיבלה את ההפרש החיובי, אם יש, בין IRR 25% וה-EERA*. רווחים השווים לסכום המצטבר של ההשקעה הנ"ל, ללא כולל Superpriority Additional Capital Contributions (2) השותפות - סעיף 5.1.2 – 100% ל-CIM, עד ש-CIM קיבלה IRR 18% בקשר עם תקבל IRR 18% בהקשר להשקעה הראשונית של השותפות. .CIM Priority Required Additional Capital Contributions - סעיף 5.1.5 – עד לסכום מצטבר של: (1) 24 מיליוני דולרים, (2) מס - סעיף 5.1.3 – ל-MEMBERS, פרו רטה, בהתאם ליתרת הסכום לחלוקה, העברה של ניו יורק אשר שולם בקשר עם הנכס**, (א) 50% ישולם ל- עד ש-(א) CIM קיבלה IRR 18% על ההשקעה הראשונית שלה וגם ה- השותפות ו-(ב) 50% ישולם ל-CIM. CIM Required Additional Capital וגם (ב) השותפות קיבלה 18% IRR על ההשקעה הראשונית שלה; למרות זאת, אם במידה ו-CIM תקבל - סעיף 5.1.6 – (א) 75% ל-MEMBERS פרו רטה בהתאם לשיעורי הריבית תחת סעיף זה סכום מצטבר שהינה פחות מ- (IRR 25% (X על ה- ו-(ב) 25% לשותפות , עד ש-CIM קיבלה גם: (1) חלוקה מצטברת לפי Discretionary Capital Contributions ועל ה- Discretionary Capital סעיף 5.1, אשר תפיק לא פחות מIRR 20%- בהקשר להשקעה הראשונית Shortfall Contributions אשר הושקעו על ידי CIM וגם (Y) ה-EERA, של CIM סכום השווה ל-Applicable Percentage של הסכום לחלוקה לשותפות עד - סעיף 5.1.7 – (א) 50% ישולם ל-CIM ו-(ב) 50% ישולם לשותפות. לסעיף זה אך לא כולל סעיף זה, יחולק ל-CIM; והינתן במידה ש- (1) אם CIM קיבלה את ה-IRR אשר תואר בסעיף (א) לסעיף זה אך השותפות לא קיבלה את ה-IRR אשר תואר בסעיף (ב) לסעיף זה, הרווחים ימשיכו להיות מחולקים תחת סעיף (ב) עד ש-CIM תקבל

* כ12- מיליוני דולרים פולאר השקעות בע"מ • ** סכום זה, אשר הוערך בכ1.8- מיליוני דולרים, נתקבל מהנהלת פולאר ולא נבדק על ידינו ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 5 פרק 2 – ניתוח פיננסי ניתוח פיננסי חישוב הרווח לחלוקה – השותפות ו- CIM – הנחות עיקריות

השקעה השקעה דולרים CIM השותפות תאריך התחלתית נוספת • במסגרת חישוב הרווח לחלוקה לשותפות ול-CIM הונח, בהתאם להנחות 37,655,174 01/03/2012 18,000,000 37,655,174 Investment at acquisition אשר קיבלנו מהנהלת פולאר אשר לא נבדקו על ידינו ואין אנו מחווים דעה 28,650,000 30/08/2013 - 28,650,000 Conversion of debt to equity עליהן, כי: Capital call #1 1,201,923 - 01/04/2012 1,201,923 - תתבצע חלוקה ראשונה בתאריך 30 בספטמבר 2015 בסך של כCapital call #2 111- 275,966 - 01/05/2012 275,966 1,174,028 01/06/2012 - 1,174,028 Capital call #3 מיליוני דולרים (תזרימי המזומנים המצטברים למועד זה); 1,230,186 01/07/2012 - 1,230,186 Capital call #4 - תתבצע חלוקה שניה בתאריך 30 באפריל 2016 על יתרת הסכום Capital call #5 1,208,329 - 01/08/2012 1,208,329 לחלוקה; Capital call #6 1,022,239 - 01/09/2012 1,022,239 795,533 01/10/2012 - 795,533 Capital call #7 - השותפות ו-CIM השקיעו לאורך הזמן, במועדים מסוימים, סכומים Capital call #8 1,440,538 - 01/11/2012 1,440,538 בפרויקט 51, כפי שמוצג בטבלה משמאל. מועדי ההשקעה וסכומי Capital call #9 3,318,258 - 01/12/2012 3,318,258 ההשקעה לא נבדקו על ידינו ואין אנו מחווים דעה עליהם; Capital call #11 916,317 - 01/02/2013 916,317 3,363,464 01/03/2013 - 3,363,464 Capital call #12 - סכומי הריבית על הלוואתה של CIM לפרויקט אשר הומרו להון מניות Capital call #13 2,418,421 - 01/04/2013 2,418,421 ייחשבו כחלק מההשקעה ההתחלתית בפרויקט. Capital call #14 3,042,538 - 01/05/2013 529,618 2,512,920 2,382,606 - 01/06/2013 - 2,382,606 Capital call #15 463,703 - 01/07/2013 - 463,703 Capital call #16 540,771 - 01/08/2013 - 540,771 Capital call #17&18 - 444,075 10/02/2013 - 444,075 Coversion of interest to equity - 401,100 10/03/2013 - 401,100 Coversion of interest to equity - 444,075 10/04/2013 - 444,075 Coversion of interest to equity - 429,750 10/05/2013 - 429,750 Coversion of interest to equity - 444,075 10/06/2013 - 444,075 Coversion of interest to equity - 429,750 10/07/2013 - 429,750 Coversion of interest to equity - 444,075 10/08/2013 - 444,075 Coversion of interest to equity - 440,750 30/08/2013 - 440,750 Coversion of interest to equity 5,900,000 88,677,644 18,000,000 94,577,644 פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 6 פרק 2 – ניתוח פיננסי ניתוח פיננסי חישוב הרווח לחלוקה – השותפות ו- CIM

• הטבלה הבאה מציגה את תוצאות הפרויקט ואת חישוב הרווח לחלוקה ל-CIM ולשותפות בכפוף לתחזיות היועץ החיצוני, הנחות הנהלת פולאר, תנאי ההסכם המקורי והתיקון להסכם :

חישוב הרווח )בדולרים( עלויות רכישה 82,000,000 עלויות קבועות 99,292,693 עלויות משתנות 25,146,033 הוצאות מימון 14,468,923 סך עלויות 220,907,649

הכנסות, נטו 365,101,404- רווח 144,193,756- חוב * 90,467,830 הון - השותפות 18,000,000 הון - CIM 88,677,644 הון נוסף - השותפות - הון נוסף - CIM 5,900,000 מימון עלויות באמצעות רווחים 21,339,819 220,907,649- השותפות 64,392,869 188,900,881 CIM

*בהתאם להנחה אשר קיבלנו מהנהלת פולאר אשר לא נבדקה על ידינו, החוב יגדל בפער בין ההון העצמי שהושקע להון העצמי הנדרש על פי תוצאות הפרויקט החזויות כפי שנמסר מהיועץ החיצוני (בסך של 172 אלפי דולרים)

פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 7 פרק 2 – ניתוח פיננסי ניתוח פיננסי חישוב הרווח לחלוקה – השותפות ו-CIM

• הטבלה הבאה מציגה את חישוב הרווח לחלוקה ל-CIM ולשותפות, לפי סעיפי התיקון להסכם (5.1.1 עד 5.1.7):

מועד חלוקה 1 מועד חלוקה 2 דולרים 30/09/2015 30/04/2016 סה"כ יתרה לחלוקה 253,293,750 141,449,344 השותפות - - סעיף - - CIM 5.1.1 - - - השותפות - - סעיף - 8,699,926 CIM 5.1.2 8,699,926 - 8,699,926 יתרת ביניים 244,593,824 141,449,344 השותפות 19,071,340 14,871,504 סעיף 64,758,043 84,073,140 CIM 5.1.3 182,774,027 79,629,547 103,144,480 יתרת ביניים 141,449,344 61,819,797 השותפות - - סעיף - - CIM 5.1.4 - - - יתרת ביניים 141,449,344 61,819,797 השותפות - 12,900,000 סעיף 12,900,000 - CIM 5.1.5 25,800,000 25,800,000 - יתרת ביניים 141,449,344 36,019,797 השותפות - 1,402,710 סעיף 2,322,457 - CIM 5.1.6 3,725,167 3,725,167 - יתרת ביניים 141,449,344 32,294,630 השותפות - 16,147,315 סעיף 16,147,315 - CIM 5.1.7 32,294,630 32,294,630 - יתרת ביניים 141,449,344 - השותפות 19,071,340 45,321,528 64,392,869 CIM 92,773,066 96,127,815 188,900,881 פולאר השקעות בע"מ • 253,293,750 ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 8 נספח 1 הגבלת אחריות

פולאר השקעות בע"מ • ניתוח פיננסי בקשר עם פרויקט מרץ 2015 מנהטן, ניו יורק , 303East 51st PwC 9 הגבלת אחריות

כל ייעוץ שינתן או מסמך סופי מאתנו מועברים לשימושכם אך ורק בקשר למטרת העבודה שסופקה. פרט לדרישה על פי דין, לא תעבירו את

העבודה לשום צד שלישי, או תאזכרו את עבודתנו, ללא הסכמתנו מראש ובכתב, אשר נעניק או נימנע מלהעניק או נתנה בתנאים, בהתאם לשיקול דעתנו, והכול תוך מתן סיבה, זאת למעט לרואי החשבון המבקרים של פולאר ובדיווחים הציבוריים של פולאר. בשום מקרה, בין אם ניתנה הסכמה או לא, לא נהיה אחראים כלפי צד שלישי אליו הועברה חוות דעתנו. במהלך עבודתנו קיבלנו מידע, נתונים, תחזיות ומצגים ("המידע") מפולאר ו/או מי מטעמן. האחריות למידע הנ"ל הינה על ספקי מידע זה. מסגרת עבודתנו אינה כוללת בדיקה ו/או אימות של המידע כאמור. בכל מקרה, עבודתנו לא תחשב ולא תהווה אישור לנכונותו, שלמותו או דיוקו של המידע, שהועבר אלינו. בשום מקרה לא נהיה אחראים לכל הפסד, נזק, עלות או הוצאה אשר יגרמו בכל אופן ודרך ממעשי הונאה, מצג שווא, הטעיה, מסירת מידע שאינו נכון ו/או שאינו מלא או מניעת מידע מצידן של פולאר ו/או מי מטעמן, או כל התבססות אחרת על מידע כאמור, בכפוף לאמור לעיל. למרות שבמהלך עבודתנו ניתחנו מידע פיננסי וחשבונאי, עבודתנו לא כללה ביקורת של ספרי פולאר על פי כללי ביקורת מקובלים. לפיכך, אין אנו נוטלים אחריות או מביעים דעה בנוגע לאמינות, לדיוק ולרלוונטיות של המידע שסופק לנו על-ידי פולאר ו/או מי מטעמן. עבודתנו אינה מהוה בדיקת נאותות ואין להסתמך עליה כבדיקת נאותות. בנוסף, עבודתנו לא תשמש כתחליף לכל פרוצדורה שעל פולאר לנקוט בקשר עם פרויקט 51.