Multi-Family/Apartment Feasibility Study Draft - Knox, IN

Scope of Work

The objectives of this study/report is to gain a better understanding of both the potential need of additional apartment units in the community of Knox, IN.

This following study/report was prepared for Starke County by HCA (Housing and Community Advisors). All research was conducted during the months of August, September and October in 2022 and evaluates the current supply of comparable multi-family units in and around the community, demand for units in the same area, and gaps between supply and demand.

Comprehensive research was performed and reviewed regarding the community's economic indicators, competitive multi-family unit supply, and multi-family unit demand generators. Economic indicators were studied to determine the stability and future growth potential of the general market. The research was conducted as a macro and micro market analysis of Knox, IN and the areas immediately surrounding area to determine their viability to support the potential of multi-family development.

General Assumptions - For the purpose of this assessment, we assumed the proposed property will be operated at market rate. It is also assumed the proposed property will utilize a fully-integrated and recognized marketing platform. If this or any of the following are not followed, it could affect the overall feasibility of subject property.

Operational Assumptions - For the purpose of this assessment, we assume the subject property would be managed by a capable, Professional Management Company.

This report provides statistical and highlighted narratives to support the conclusions regarding the market area and it's ability to support potential multi-family housing.

Executive Summary

Community Economic Summary - Employment in the Knox area is concentrated in the healthcare, public administration, food services, retail, manufacturing, and the scientific and technology services industries. The large share of healthcare is notable as this industry is historically extremely stable. Relatively low compared to the overall nation, the Knox area features comparatively more stable employment in healthcare and education industries.

Location Summary - Most necessary services and amenities are located in the community of Knox compared to the surrounding communities. The community of Knox is located in the north eastern section of Indiana on Highway 35.

Community Demographics Summary - The Knox area has demonstrated a population decrease by a small amount from 2010 but in expected to grow in projections. It is the opinion of HCA that a small amount of growth should be expected to increase through 2030 due to efforts in place to grow the economy locally. As population grows, the need for good quality market rate multi-family housing is also expected to increase.

Supply Summary - The vacancy rates among the stabilized market rate competitive set is 2.7% over the trending 12 months. The vacancy rate among the overall market of the closest Submarket Data shows a vacancy rate of .5% 4 and 5 Star properties, 3 Star properties is 1.6% and 1 and 2 Star properties was 1.5%. This averages 1.4% vacancy in the overall Submarket. Overall, the low vacancy rates among all star category market rate properties, suggests that the market is strong with demand for additional units.

Executive Summary

HCA estimates, there is a potential demand for 70 to 90 new, market rate rental units available to the proposed location. Taking into consideration of the information in the report as well as the fact that there has been no new development in the Knox, IN market, the overall Market and Median Rental Rates and the occupancy rate we feel the 78 units in Knox, Indiana will make good business sense.

Using a conservative rent to income ratio of four to one, renter households need a household income of close to $38,832 to qualify for the current, 12 month average rent of $809 (previous 12 month average rent was $740) in the market of Knox. Using a the industry standard rent to income ratio of a three to one, renter households need a household income of close to $29,124 to qualify for the current, 12 month average rent. The average income for households in the market, however, is over $62,745 within five miles of the proposed location in 2022. That means that the average household in the market can afford rents of closer to $1,307 per month conservatively at 25% of total income. In a typical ratio of three to one or 33%, over half the market could afford more than $1,725 per month.

One, two, and three bedroom units should be featured. We advise the one-bedroom floor plans offer between 700 and 850 square feet. We advise two-bedroom floor plans offer between 900 and 1100 square feet. We advise three-bedroom floor plans offer between 1100 and 1300 square feet. Monthly rents should be between $950 and $1,050 for the one-bedroom units, $1,200 and $1,275 for the two-bedroom units, and $1,400 to $1,500 for three-bedroom units per month. If the product is successfully developed at these rents and units sizes, and the site is fully marketed, the proposed 70 to 90 units will lease up in less than 18 months.

This conclusion is based on the current and local supply, demand, operating costs, and development costs. The conclusion is also based on the potential units being financed, developed, and operated/managed in a fiscally responsible manner.

Community Overview

Knox is a city in Center Township, Starke County, in the U.S. state of Indiana. The city is located along the Yellow River and the county seat of Starke County.

Starke County - With a population of around 24,000 people, the count consists of three townships and has a commission form of government. The terrain of Starke County consists of low rolling hills covered in vegetation and brush. The northwestern boundary of Starke County is defined by the Kankakee River; the Yellow River, a tributary of the Kankakee, flows through the central part of the county, past Knox. Communities within Starke County consist of:

Knox is a city in Center Township, Starke County, in the U.S. state of Indiana.

North Judson is a town in Wayne Township, Starke County, in the U.S. state of Indiana.

Hamlet is a town in Davis and Oregon Townships, Starke County, in the U.S. state of Indiana.

Bass Lake is a census-designated place (CDP) in California and North Bend Townships, Starke County, in the U.S. state of Indiana.

Koontz Lake is a census-designated place (CDP) in Marshall and Starke counties, in the U.S. state of Indiana.

San Pierre is a census-designated place (CDP) in Railroad Township, Starke County, in the U.S. state of Indiana.

Starke County also has 13 unincorporated communities. They include; Aldine, Bass Station, Brems, English Lake, Grovertown, Indian Hill, Lena Park, Lomax, Oak Grove, Ober, Ora, Toto, and Winona.

Community Economic/Demographics Overview Factors

For the purposes of this Comprehensive Multi-Family Market Feasibility Study, HCA researched up to date Economic Factors in regard to Lincoln and the surrounding areas. This information includes but is not limited to:

Consumer Spending

Daytime Employment

Demographic Detail

Demographic Market Comparison

Demographic Summary

Demographic Trend

Total Apparel $2,423 $5,070 $11,561

Women's Apparel 899 1,903 4,365

Men's Apparel 461 997 2,317

Girl's Apparel 185 370 829

Boy's Apparel 142 291 647

Infant Apparel 128 257 577

Footwear 608 1,252 2,826

Total Entertainment & Hobbies $7,175 $15,430 $35,553 Entertainment 820 1,931 4,619

Audio & Visual Equipment/Service 1,581 3,355 7,664

Reading Materials 110 242 558

Pets, Toys, & Hobbies 1,299 2,778 6,395

Personal Items 3,366 7,124 16,316

Total Food and Alcohol $12,619

$26,747 $61,251

Food At Home 7,265 15,120 34,399

Food Away From Home 4,546 9,896 22,862

Alcoholic Beverages 808 1,731 3,991

Total Household

$6,597

$14,667 $34,058

House Maintenance & Repair 1,719 3,881 9,067

Household Equip & Furnishings 2,596 5,815 13,577

Household Operations 1,741 3,758 8,603

Housing Costs 542 1,213 2,812

2022 Annual Spending

Total Transportation/Maint. $11,692

$26,512 $63,695

Vehicle Purchases 6,179 14,501 35,837

Gasoline 3,282 7,110 16,448

Vehicle Expenses

1,400 3,272

405 927 Transportation

Automotive Repair & Maintenance 1,419 3,097 7,211

Total Health Care $2,642 $5,648 $12,978

Medical Services 1,500 3,223 7,411 Prescription Drugs

1,868 4,278 Medical

558 1,290

Total Education/Day Care $1,813 $4,090 $9,582 Education 1,075 2,454 5,809 Fees & Admissions

1,636 3,773

Business Employment by

Total

Retail & Wholesale

Hospitality & Food Service

Real Estate, Renting,

Finance & Insurance

& Technology Services

of Companies

Health Care & Social Assistance

Services

Public Administration & Sales

Entertainment, Recreation

& Waste Management

of Businesses

Other

Mining,

Population

2027 Projection 4,494 9,157 20,629 2022 Estimate 4,470 9,068 20,453

2010 Census 4,613 9,163 20,720

Growth 2022 - 2027 0.54% 0.98% 0.86%

Growth 2010 - 2022 -3.10% -1.04% -1.29%

2022 Population by Age 4,470

9,068 20,453

Age 0 - 4 273 6.11% 526 5.80% 1,158 5.66%

Age 5 - 9 290 6.49% 565 6.23% 1,233 6.03%

Age 10 - 14 311 6.96% 609 6.72% 1,328 6.49%

Age 15 - 19 297 6.64% 589 6.50% 1,301 6.36%

Age 20 - 24 265 5.93% 523 5.77% 1,167 5.71%

Age 25 - 29 279 6.24% 543 5.99% 1,212 5.93%

Age 30 - 34 277 6.20% 537 5.92% 1,184 5.79%

Age 35 - 39 274 6.13% 531 5.86% 1,154 5.64%

Age 40 - 44 274 6.13% 541 5.97% 1,178 5.76%

Age 45 - 49 273 6.11% 547 6.03% 1,214 5.94%

Age 50 - 54 269 6.02% 553 6.10% 1,262 6.17%

Age 55 - 59 281 6.29% 588 6.48% 1,369 6.69%

Age 60 - 64 292 6.53% 623 6.87% 1,457 7.12%

Age 65 - 69 276 6.17% 596 6.57% 1,388 6.79%

Age 70 - 74 210 4.70% 468 5.16% 1,096 5.36%

Age 75 - 79 149 3.33% 338 3.73% 799 3.91%

Age 80 - 84 96 2.15% 216 2.38% 518 2.53%

Age 85+ 83 1.86% 175 1.93% 433 2.12%

Age 65+ 814 18.21% 1,793 19.77% 4,234 20.70%

Median

Knox, IN 46534

Radius 2 Mile 5 Mile 10 Mile

2022 Population By Race 4,470 9,068 20,453

White 4,341 97.11% 8,838 97.46% 19,890 97.25%

Am. Indian & Alaskan

Hawaiian & Pacific Island

0.49%

0.43%

19 0.43%

0.00%

1.52%

0.51% 110 0.54%

0.42% 121 0.59%

0.35% 65 0.32%

0.00%

1.26%

Population by Hispanic Origin 4,470 9,068 20,453

0.00%

1.31%

Non-Hispanic Origin 4,299 96.17% 8,707 96.02% 19,546 95.57%

Hispanic Origin

3.83% 361 3.98% 908 4.44%

2022 Median Age, Male 38.10 40.00 41.30

Average Age, Male 38.50 39.70 40.60

2022 Median Age, Female 40.70 42.10 42.90

Average Age, Female 40.50 41.40 41.90

2022 Population by Occupation Classification 3,537 7,251 16,477

Civilian Employed 1,648 46.59% 3,631 50.08% 8,679 52.67%

Civilian Unemployed 167 4.72% 256 3.53% 503 3.05%

Civilian Non-Labor Force 1,722 48.69% 3,361 46.35% 7,289 44.24% Armed Forces 0 0.00% 3 0.04% 6 0.04%

Households by Marital Status

Married 785 1,799 4,231

Married No Children 494 1,151 2,746

Married w/Children 292 648 1,486

2022 Population by Education 3,167 6,500 14,659

Some High School, No Diploma 553 17.46% 1,000 15.38% 2,221 15.15%

High School Grad (Incl Equivalency) 1,324 41.81% 2,625 40.38% 5,890 40.18%

Some College, No Degree 819 25.86% 1,915 29.46% 4,443 30.31%

Associate Degree 134 4.23% 243 3.74% 393 2.68%

Bachelor Degree 219 6.92% 466 7.17% 1,167 7.96%

Advanced Degree 118 3.73% 251 3.86% 545 3.72%

Knox, IN 46534

Radius 2 Mile 5 Mile 10 Mile

2022 Population by Occupation 3,083 6,793 16,233

Real Estate & Finance

Professional & Management

Public Administration

Education & Health

2.08% 130 1.91% 286 1.76%

14.63% 1,085 15.97% 2,714 16.72%

1.82% 106 1.56% 272 1.68%

15.24% 1,006 14.81% 2,110 13.00%

Services 318 10.31% 593 8.73% 1,334 8.22%

Information 19 0.62% 60 0.88% 96 0.59%

Sales 312 10.12% 678 9.98% 1,622 9.99%

Transportation

0.00%

0.03% 22 0.14%

Retail 152 4.93% 344 5.06% 904 5.57%

Wholesale

0.81%

0.69% 102 0.63%

Manufacturing 485 15.73% 921 13.56% 2,242 13.81%

Production 510 16.54% 1,043 15.35% 2,385 14.69%

Construction 135 4.38% 374 5.51% 1,046 6.44%

Utilities 19 0.62% 133 1.96% 433 2.67%

Agriculture & Mining

Farming, Fishing, Forestry

Other Services

0.19% 49 0.72% 140 0.86%

0.03%

1.95%

0.07% 19 0.12%

3.19% 506 3.12%

2022 Worker Travel Time to Job 1,624 3,539 8,446

<30 Minutes 1,074 66.13% 2,204 62.28% 4,931 58.38%

30-60 Minutes 409 25.18% 876 24.75% 2,345 27.76%

Minutes 141 8.68% 459 12.97% 1,170 13.85%

2010 Households by HH Size 1,793 3,507 7,888

1-Person Households 476 26.55% 830 23.67% 1,825 23.14%

2-Person Households 585 32.63% 1,227 34.99% 2,833 35.92%

3-Person Households 293 16.34% 570 16.25% 1,278 16.20%

4-Person Households 235 13.11% 480 13.69% 1,054 13.36%

5-Person Households 133 7.42% 250 7.13% 541 6.86%

6-Person Households 46 2.57% 96 2.74% 219 2.78%

7 or more Person Households 25 1.39% 54 1.54% 138 1.75%

2022 Average Household Size

Households

2027 Projection 1,747 3,501 7,848

Estimate 1,738 3,468 7,783

2010 Census 1,793 3,505 7,889

Growth 2022 - 2027 0.52% 0.95% 0.84%

Growth 2010 - 2022 -3.07% -1.06% -1.34%

Radius 2 Mile

2022 Households by HH Income

<$25,000

$25,000 - $50,000

$50,000 - $75,000

$75,000 - $100,000

$100,000 - $125,000

$125,000 - $150,000

46534

Mile 10 Mile

1,737 3,469 7,782

28.79%

30.05%

21.01%

9.90%

2.94%

2.36%

21.36% 1,568 20.15%

28.42% 2,100 26.99%

23.06% 1,708 21.95%

12.14% 1,069 13.74%

5.02% 487 6.26%

4.90% 432 5.55%

$150,000 - $200,000

2.71%

2.25%

2.19% 151 1.94%

2.91% 267 3.43% $200,000+

2022 Occupied Housing 1,738 3,468 7,783

Owner Occupied 1,152 66.28% 2,640 76.12% 6,191 79.55%

Renter Occupied 586 33.72% 828 23.88% 1,592 20.45%

2010 Housing Units 1,990 3,986 8,850

1 Unit 1,634 82.11% 3,584 89.91% 8,234 93.04%

- 4 Units

- 19 Units

Units

5.53% 156 3.91% 288 3.25%

7.44% 148 3.71% 200 2.26%

4.92% 98 2.46% 128 1.45%

2022 Housing Value 1,153 2,639 6,190

<$100,000 562 48.74% 986 37.36% 2,198 35.51%

$100,000 - $200,000

4.16% 173 6.56% 627 10.13%

36.60% 1,275 48.31% 2,922 47.21% $200,000 - $300,000

$300,000 - $400,000

0.43% 26 0.99% 87 1.41%

2.43% 77 2.92% 218 3.52% $400,000 - $500,000

$500,000 - $1,000,000

2022 Median Home Value

7.63%

0.00%

0.15% 19 0.31%

3.71% 119 1.92% $1,000,000+

$130,698

2022 Housing Units by Yr Built 2,055 4,236 9,718

Built 2010+

Built 2000 - 2010

Built 1990 - 1999

Built 1980 - 1989

Built 1970 - 1979

Built 1960 - 1969

Built 1950 - 1959

Built <1949

2022 Median Year Built

1.17%

3.75%

10.90%

7.01%

18.69%

12.07%

11.97%

34.45%

2.71% 293 3.02%

6.37% 680 7.00%

14.52% 1,420 14.61%

6.94% 803 8.26%

18.86% 1,692 17.41%

12.54% 1,233 12.69%

11.00% 1,025 10.55%

27.05% 2,572 26.47%

Mile County

Population Growth

Growth 2010 - 2022 -3.97% -1.61%

Growth 2022 - 2027 0.37% -0.10%

91.93% 92.58%Empl 2,175 9,723 8.07% 7.42%Unempl 191 779

2022 Population by Race 5,680 22,989

97.32% 97.59%White 5,528 22,434 0.49% 0.43%Black 28 100 0.39% 0.50%Am. Indian & Alaskan 22 114

0.40% 0.23%Asian 23 54 0.00% 0.00%Hawaiian & Pacific Island 0 0 1.39% 1.25%Other 79 287

Household Growth

Growth 2010 - 2022 -3.95% -1.57%

Growth 2022 - 2027 0.37% -0.09%

29.87% 20.55%Renter Occupied 653 1,828 70.13% 79.45%Owner Occupied 1,533 7,066

2022 Households by Household Income 2,184 8,894

25.37% 20.62%Income <$25K 554 1,834 28.39% 27.73%Income $25K - $50K 620 2,466 22.02% 21.82%Income $50K - $75K 481 1,941 11.63% 13.08%Income $75K - $100K 254 1,163

3.62% 6.55%Income $100K - $125K 79 583

3.85% 6.68%Income $125K - $150K 84 594 2.98% 2.30%Income $150K - $200K 65 205 2.15% 1.21%Income $200K+ 47 108

Radius 2 Mile 5 Mile 10 Mile

Population

2027 Projection 4,494 9,157 20,629 2022 Estimate 4,470 9,068 20,453

2010 Census 4,613 9,163 20,720

Growth 2022 - 2027 0.54% 0.98% 0.86%

Growth 2010 - 2022 -3.10% -1.04% -1.29%

2022 Population by Hispanic Origin 170 361 907

2022 Population 4,470 9,068 20,453

White 4,341 97.11% 8,838 97.46% 19,890 97.25%

Black 22 0.49% 46 0.51% 110 0.54%

Am. Indian & Alaskan 19 0.43% 38 0.42% 121 0.59%

Asian 19 0.43% 32 0.35% 65 0.32%

Hawaiian & Pacific Island 0 0.00% 0 0.00% 0 0.00%

Other 68 1.52% 114 1.26% 268 1.31%

U.S. Armed Forces 0 3 6

Households

2027 Projection 1,747 3,501 7,848

2022 Estimate 1,738 3,468 7,783

2010 Census 1,793 3,505 7,889

Growth 2022 - 2027 0.52% 0.95% 0.84%

Growth 2010 - 2022 -3.07% -1.06% -1.34%

Owner Occupied 1,152 66.28% 2,640 76.12% 6,191 79.55%

Renter Occupied 586 33.72% 828 23.88% 1,592 20.45%

2022 Households by HH Income 1,737 3,469 7,782

Income: <$25,000

Income: $25,000 - $50,000

Income: $50,000 - $75,000

Income: $75,000 - $100,000

$100,000 - $125,000

Income: $125,000 - $150,000

$150,000 - $200,000

$200,000+

Avg Household Income $55,434

Med Household Income

28.79%

30.05%

21.01%

9.90%

2.94%

2.36%

2.71%

2.25%

21.36% 1,568 20.15%

28.42% 2,100 26.99%

23.06% 1,708 21.95%

12.14% 1,069 13.74%

5.02% 487 6.26%

4.90% 432 5.55%

2.91% 267 3.43%

2.19% 151 1.94%

$65,072

$52,801

Description 2010 2022 2027

Population 5,915 5,680 5,701

Age 0 - 4 409 6.91% 340 5.99% 325 5.70%

Age 5 - 9 420 7.10% 363 6.39% 340 5.96%

Age 10 - 14 429 7.25% 391 6.88% 363 6.37%

Age 15 - 19 449 7.59% 375 6.60% 376 6.60%

Age 20 - 24 363 6.14% 334 5.88% 362 6.35%

Age 25 - 29 334 5.65% 350 6.16% 349 6.12%

Age 30 - 34 361 6.10% 347 6.11% 343 6.02%

Age 35 - 39 381 6.44% 343 6.04% 341 5.98%

Age 40 - 44 362 6.12% 345 6.07% 340 5.96%

Age 45 - 49 426 7.20% 346 6.09% 339 5.95%

Age 50 - 54 431 7.29% 344 6.06% 338 5.93%

Age 55 - 59 406 6.86% 361 6.36% 340 5.96%

Age 60 - 64 335 5.66% 378 6.65% 346 6.07%

Age 65 - 69 248 4.19% 358 6.30% 343 6.02%

Age 70 - 74 205 3.47% 276 4.86% 307 5.39%

Age 75 - 79 153 2.59% 197 3.47% 236 4.14%

Age 80 - 84 115 1.94% 126 2.22% 160 2.81% Age 85+ 89 1.50% 106 1.87% 154 2.70%

Age 15+

78.75% 4,586 80.74% 4,674 81.99%

Age 20+ 4,209 71.16% 4,211 74.14% 4,298 75.39%

Age 65+ 810 13.69% 1,063 18.71% 1,200 21.05%

Median Age

Population

Race

Indian & Alaskan

& Pacific Islander

97.32% 5,527 96.95%

0.49% 30 0.53%

0.39%

0.40%

1.41%

0.47%

0.53%

0.00%

1.53%

Household by Household Income

<$25,000

$25,000 - $50,000

- $75,000

$75,000 - $100,000

$100,000 - $125,000

$125,000 - $150,000

- $200,000

$200,000+

29.29%

15.37%

6.98%

3.12%

1.54%

0.31%

0.53%

25.37%

28.39%

22.02%

11.63%

3.62%

3.85%

2.98%

2.15%

24.30%

28.27%

22.48%

11.86%

3.74%

3.92%

3.19%

2.23%

Employment Overview

Maintaining healthy, strong existing businesses is not only important for the economic vitality of Knox, Indiana and Starke County, but it plays a critical component in growing the economic base of the area. What’s more important is that the existing companies here work together to create a thriving community.

Starke County's industrial base is varied with heavy emphasis on the steel, related components, plastics, automotive, agricultural, home, and container industries. Even in difficult economic times nationally, employment and job search opportunities in Knox and Starke County have remained strong, and better than much of the U.S.

A distinct advantage to industry provided by the Starke County Economic Development Foundation is the ability for Starke County Industries to work together in producing their respective products. Some examples are: Hoosier Custom Plastics provides the plastic injection onto the fine blanked parts manufactured by MPI; and Dragon Industries does some work for Kruz, Inc. The City of Knox and Starke County are also larger employers in the area. The following are some more notable employers in Starke County:

American Oak Preserving Company manufactures and imports home accent décor items which are sold in small stores and large chain stores throughout the United States. Beginning as a family-owned business in 1916, it first began preserving oak leaves and has since expanded to all types of natural home décor items. The Company recently finished construction of new administrative offices and showroom for their products, as well as a new warehouse facility.

Callisons, Inc. is the market leader in the global supply of premium mint oils, mint flavors, and mint - related ingredients. Callisons has two divisions in Starke County, the first being its Research and Development in the Town of Hamlet and its storage and shipping division in the City of Knox. Callisons is the leading buyer of mint oil in Indiana.

Chester's Ag Systems Division is located in North Judson where they sell and service irrigation systems, and grain handling or storage facilities.

Dragon repairs truck trailers and also are dealers in tarps, fenders, bedliners, and other items for tractor trailers, as well as doing aluminum and steel welding and fabrication.

Employment Overview (continued)

Hoosier Custom Plastics specializes in tight tolerance and plastic insert molding applications with specialties in injection molding, plastic molding, plastic insert molding, and over molding. Additional services include design, mold-flow analysis, assembly, sonic welding, and tooling services for both Asian and domestic sources. Ecogolf produces biodegradable golf tees.

J.W. Hicks provides a full range of quality refractory products and services for the metal industry through specialty refractory products. Equipment required for on-site refractory use or placement is also supplied.

Kemin uses science and research to enhance nutrition and health for humans and animals, manufacturing over 500 specialty ingredients used by the feed and food industries, and the health, nutrition, and beauty markets.

Knox Fertilizer Company blends fertilizers and provides research on fertilizers and their release for the residential, golf course, and athletic field markets. Knox Fertilizer blends for its own lines as well as other wellknown labels. Through its research efforts, Knox Fertilizer holds many patents.

Kruz, Inc. is a high value manufacturer of aluminum trailers, "Ravens by Kruz," and steel "Kruz" trailers used in the heavy construction and scrap fields. Kruz ships throughout the United States, Canada and Iceland.

MPI was a pioneer in the United States Fine blanking industry and is the largest fine blanking organization in North America. As such, it is a global leader and highly specialized supplier of fine blanked components and innovative die design, process engineering, and customer service. Fine blanking is a high-precision, near-net process combining principles of metal stamping and cold-forming.

Norton has operated in Hamlet, Indiana since 1996 supplying containers that hold a variety of products for the paint, janitorial, petrochemical, agricultural, adhesive, and food packaging industries.

Outstanding Tradeshow Exhibit Services is a woman-owned custom designer of tradeshow exhibits, graphic designs, and banners

Employment Overview (continued)

Konrad has been in operation in Starke County since 1957, being an architectural millwork plant manufacturing kitchen cabinets and business office suites out of wood, plastic laminates, and solid surface materials. Their primary customers include schools, libraries, governmental offices, medical facilities, banks, and churches.

Reagent Chemical and Research has constructed three buildings and 6,155 lineal feet to the existing County Lead Track in order to equip new rubber-lined tank cars and maintain and repair its existing fleet of rail cars, and also over the road trailers. Another division of this company, White Flyer, has been operating in Knox for some time.

Selected Furniture is a prime manufacturer of commercial furniture catering to the hospitality industry, including fast food chains, quick service restaurants, and fine dining establishments.

Traffic Control provides traffic signs, striping, parking bumpers and equipment, and also engages in parking area maintenance and marking. They can also produce plastic, aluminum, and wood signs including all traffic control signs in multiple sizes. The company also serves as a subcontractor to several prime highway contractors.

WestRock is one of the world's largest paper and packaging companies with $15 billion in annual revenue and 42,000 employees in 30 countries. The company aspires to be the premier partner and unrivaled provider of paper and packaging solutions in consumer and corrugated markets.

Education Overview

Knox Community School Corporation is a public school district located in KNOX, IN. It has 1,765 students in grades PK, K-12 with a student-teacher ratio of 14 to 1. According to state test scores, 36% of students are at least proficient in math and 42% in reading.

Described below are some of the major educational facilities in the area:

Knox Community High School is a public school located in KNOX, IN. It has 589 students in grades 9-12 with a student-teacher ratio of 12 to 1. According to state test scores, 22% of students are at least proficient in math and 57% in reading.

Education Overview

Knox Community Middle School is a public school located in KNOX, IN. It has 525 students in grades 5-8 with a student-teacher ratio of 14 to 1. According to state test scores, 35% of students are at least proficient in math and 40% in reading.

Knox Community Elementary School is a public school located in KNOX, IN. It has 651 students in grades PK, K-4 with a student-teacher ratio of 17 to 1. According to state test scores, 47% of students are at least proficient in math and 38% in reading.

Although the ranking of Knox is not currently ideal, when comparing smaller districts and the rank growth of the school district from 2019, Knox's Public School's attractiveness is gaining traction. The school grew 28 spots overall to 217 out of 353 from 2019 to 2021.

Additionally, Knox Community Elementary School (PK to 8th Grade) is ranked 476 out of 1016, Knox Community Middle School is ranked 363 out of 483, and Knox Community High School is ranked 197 out of 388.

Source: Niche.com and SchoolDigger.com

Competitive Set Overview

For the purposes of this Comprehensive Multi-Family Market Feasibility Study, the competitive set includes properties that were determined could be competitive with the proposed multi-family development project based on either their location, facilities/amenities offered, rate, size, and/or market orientation. Additionally, HCA must follow specific guidelines in order to access accurate CoStar data. The following section offers information on each competitive hotel. This information includes but is not limited to:

Building Information

Land Information

Supply

Unit Mix

Additional Fees

Policy Information

Local Transportation Information

Additional Building Notes

The Competitive Set Data Summary will follow this section. All data is provided by the CoStar Group and was updated in October of 2022.

Property

Property

BUILDING

BEDROOM SUMMARY

Models Counts

Totals Avg SF Units

Beds

100.0%

100.0%

UNIT MIX

Models Counts

Beds

Avg

SALE

For Sale

Rate

Rent

Per

Rent

Effective Rent Concessions

Unit Per

TRANSPORTATION

of a

min drive to South Bend Regional

BUILDING

BEDROOM

Property

1405 W 18th St - MapleTree Apartments

Models Counts

Totals Avg

UNIT MIX

Models Counts

Available

Asking Rent Avg Effective Rent Concessions

Unit

Beds

FEES

Application Fee $25

Available Avg Asking Rent Avg Effective Rent Concessions

$0.88

$0.93

$0.80

$0.77

PET POLICY

Birds Allowed - 2 Maximum,

Cats Allowed - $0 Deposit, $25/Mo, 2 Maximum, One-Time Fee: $150 Dogs Allowed - $0 Deposit, $25/Mo, 2 Maximum, One-Time Fee: $150

Fishes Allowed -

Reptiles Allowed -

TRANSPORTATION

Airport

min drive to South Bend Regional Airport Walk Score®

(24)

BUILDING NOTES

1405 W 18th Street is a multi-family property

The two-story properties

The bed-bath mix,

square feet in La Porte, IN.

Property

1204

La

Ave - Maple City Square

TRANSPORTATION

Airport 41 min drive to South Bend Regional Airport Walk Score®

Somewhat Walkable (60)

BUILDING

LAND

EXPENSES

BEDROOM

Property

Andrew Ave - Nybe Apartments

La

TRANSPORTATION

-

Airport 42 min drive to South Bend Regional Airport Walk Score® Car-Dependent (39)

UNIT MIX

Property Summary Report

2400 Andrew Ave - La Porte Commons

La Porte, IN 46350 - South Bend/Elkhart Submarket

FEES

Application Fee $20

PET POLICY

Birds Allowed - $0/Mo, Cats AllowedDogs AllowedFishes Allowed - $0/Mo, Reptiles Allowed - $0/Mo,

TRANSPORTATION

Airport 44 min drive to South Bend Regional Airport Walk Score® Car-Dependent (6)

Angela Dr - Lakeview Apartments

BUILDING

LAND

EXPENSES

FEATURES

Property Summary

1014 Angela Dr - Lakeview Apartments

-

BEDROOM SUMMARY

Models Counts Units Available Avg Asking Rent Avg Effective Rent Concessions

Totals Avg SF Units Mix

All 1 Beds 767 27 29.3%

All 2 Beds 924 65 70.7%

Totals 878 92 100.0%

UNIT MIX

Per Unit Per SF Per Unit Per SF %

3.7% $878 $1.14 $875 $1.14 0.2%

0.0% $939 $1.02 $937 $1.01 0.3%

1.1% $921 $1.05 $919 $1.05 0.3%

Models Counts Units Available Avg Asking Rent Avg Effective Rent Concessions

Beds Baths Avg SF Units Mix

1 1 767 27 29.3%

2 1 930 50 54.3%

2 2 906 15 16.3%

FEES

Application Fee $30

Percent Per Unit Per SF Per Unit Per SF %

3.7% $878 $1.14 $875 $1.14 0.2%

0.0% $898 $0.97 $895 $0.96 0.2%

0.0% $1,078 $1.19 $1,075 $1.19 0.3%

PET POLICY

Cats Allowed - $350 Deposit, $30/Mo, 2 Maximum, Dogs Allowed - $350 Deposit, $30/Mo, 2 Maximum, Maximum Weight 30 lb,

TRANSPORTATION

Parking 93 available (Surface);Ratio of 1.79/Unit Airport 34 min drive to South Bend Regional Airport

Walk Score® Car-Dependent (10)

BUILDING

BEDROOM

Property Summary Report

1807 Beech St - Maison Royale

Valparaiso, IN 46383 - Porter County

FEES

Admin Fee $300

Application Fee $50

TRANSPORTATION

Walk Score®

PET POLICY

Cats Allowed - $500 Deposit, 2 Maximum, Dogs Allowed - $500 Deposit, $10/Mo, 2 Maximum, Maximum Weight 20 lb,

Somewhat Walkable (50)

Transit Score® Minimal Transit (20)

TENANTS

Maison Royale 3,000 SF

BUILDING

LAND

Amenities

BEDROOM

Property

UNIT MIX

$1.43

$1,244 $1.34

$1,325 $1.31

$1,613 $1.23

FEES

Admin

PET POLICY

Cats Allowed - $500 Deposit, $25/Mo, 2 Maximum, Maximum Weight 50 lb,

Dogs Allowed - $500 Deposit, $25/Mo, 2 Maximum, Maximum Weight 50 lb,

TRANSPORTATION

Parking 110 available (Covered);Ratio of 2.72/Unit Walk Score® Car-Dependent (42) Transit Score® Minimal Transit (20)

TENANTS

L

Combs - Compass Pointe

3,000 SF

BUILDING

BEDROOM

UNIT MIX

FEES

SALE

Sold Price

Type

Financing

Mortgage: Center Bank Bal/Pmt: $919,940/-

PET POLICY

Birds

One-Time

-

Weight 25 lb, One-Time Fee: $200

TRANSPORTATION

Parking

BUILDING NOTES

85 available (Surface);Ratio of 1.31/Unit

Very Walkable (73) Transit Score® Minimal Transit (23)

Walk Score®

BUILDING

BEDROOM

UNIT MIX

FEES

SALE

Sold Price

($67,241/Unit)

2020

Type Investment

Rate

Financing

Mortgage: Royal Savings Bank Bal/Pmt: $4,375,000/-

TRANSPORTATION

Parking

available (Surface);Ratio of 1.12/Unit

Walk Score® Somewhat Walkable (57)

Score® Minimal Transit (22)

BUILDING

EXPENSES

FEATURES

BEDROOM SUMMARY

UNIT MIX

Property

FEES

SALE

Unknown Lender (As-

TRANSPORTATION

BUILDING NOTES

The bed-bath mix, unit counts and

through public record.The actual models and unit mix are still to be

BUILDING

EXPENSES

BEDROOM

UNIT MIX

Property Summary Report

Firestone Ln - Stoney Meadow Apartments

Valparaiso, IN 46383 - Porter County Submarket

FEES

Application Fee $25

SALE

Sold Price Not Disclosed

Date

Aug 2021

Sale Type Investment

Financing

1st Mortgage Bal/Pmt: $1,920,000/-

TRANSPORTATION

Parking 65 available (Surface);Ratio of 1.71/Unit

Walk Score® Very Walkable (72)

Transit Score® Minimal Transit (22)

BUILDING

LAND

EXPENSES

BEDROOM

Property Summary

Valparaiso,

FEES

Application Fee $35

-

County

PET POLICY

Cats Allowed - $500 Deposit, $15/Mo, Dogs Allowed - $300 Deposit, $15/Mo, Others Allowed - $300 Deposit, $15/Mo, 2 Maximum,

TRANSPORTATION

Walk Score®

Transit Score®

Car-Dependent (37)

Minimal Transit

BUILDING

Type

LAND

EXPENSES

BEDROOM SUMMARY

Property Summary Report

1340 Holloway Dr - Mallard and HI-TEC Apartments

Plymouth, IN 46563 - Indiana North Area Submarket

FEES

Application Fee $30

PET POLICY

Cats Allowed - $350 Deposit, $30/Mo, 1 Maximum, Dogs Allowed - $350 Deposit, $30/Mo, 1 Maximum, Maximum Weight 30 lb,

TRANSPORTATION

Parking 18 available (Covered);120 available (Surface);Ratio of 2.76/Unit Airport 56 min drive to South Bend Regional Airport

Walk Score® Car-Dependent (12)

BUILDING

EXPENSES

BEDROOM SUMMARY

UNIT MIX

Property Summary Report

1415 Holloway Dr - Mallard Lake Apartments

Plymouth, IN 46563 - Submarket

FEES

Application Fee $20

PET POLICY

Birds Allowed -

Cats Allowed - $20/Mo, 1 Maximum, One-Time Fee: $300

Dogs Allowed - $20/Mo, 1 Maximum, Maximum Weight 40 lb, One-Time Fee: $300

Fishes Allowed -

Reptiles Allowed -

TRANSPORTATION

Airport 56 min drive to South Bend Regional Airport

Walk Score® Car-Dependent (12)

BEDROOM SUMMARY

Property Summary Report

MIX

Models Counts Units Available Avg Asking Rent Avg Effective Rent Concessions

Beds Baths Avg SF Units Mix % Units Percent Per Unit Per SF Per Unit Per SF %

1 1 775 3 7.5% 0 0.0% $1,285 $1.66 $1,282 $1.65 0.3%

2 2 938 6 15.0% 2 33.3% $1,801 $1.92 $1,797 $1.92 0.2%

2 2 1,006 1 2.5% 1 100.0% $1,672 $1.66 $1,668 $1.66 0.2%

2 2 1,057 2 5.0% 1 50.0% $1,776 $1.68 $1,771 $1.68 0.3%

2 2 1,058 2 5.0% 1 50.0% $1,838 $1.74 $1,834 $1.73 0.2%

2 2 1,102 1 2.5% 1 100.0% $1,801 $1.63 $1,796 $1.63 0.3%

2 2 1,123 7 17.5% 5 71.4% $1,756 $1.56 $1,752 $1.56 0.2%

2 2 1,136 4 10.0% 0 0.0% $1,848 $1.63 $1,843 $1.62 0.3%

2 2 1,174 1 2.5% 1 100.0% $2,110 $1.80 $2,104 $1.79 0.3%

2 2 1,196 2 5.0% 0 0.0% $1,972 $1.65 $1,967 $1.64 0.3%

2 2 1,213 2 5.0% 0 0.0% $1,729 $1.42 $1,725 $1.42 0.2%

2 2 1,214 1 2.5% 1 100.0% $1,955 $1.61 $1,950 $1.61 0.3%

2 2 1,236 3 7.5% 2 66.7% $1,750 $1.42 $1,745 $1.41 0.2%

3 2 1,213 2 5.0% 1 50.0% $2,218 $1.83 $2,213 $1.82 0.2%

3 2 1,314 3 7.5% 2 66.7% $1,776 $1.35 $1,771 $1.35 0.2%

PET POLICY

Cats Allowed - $50 Deposit, $200/Mo, 2 Maximum, Dogs Allowed - $50 Deposit, $200/Mo, 2 Maximum,

TRANSPORTATION

Airport 53 min drive to South Bend Regional Airport Walk Score® Somewhat Walkable (64)

BUILDING

Type

Metering

Star Garden Apartments

Metered

Wood Frame

Type Market

LAND

Land Acres

64-10-17-451-001.000-029

FEATURES

BEDROOM SUMMARY

Amenities

$1.53

$1.53

UNIT MIX

$1.63

$1.60

1715 Lake Michigan Dr -The Lakes ofValparaiso

Models Counts Units Available Avg Asking Rent Avg Effective Rent Concessions

Beds Baths Avg SF Units Mix % Units Percent Per Unit Per SF Per Unit Per SF %

1 1 897 18 4.4% 0 0.0% $1,447 $1.61 $1,442 $1.61 0.3%

1 1 935 9 2.2% 0 0.0% $1,376 $1.47 $1,372 $1.47 0.3%

1 1 936 18 4.4% 0 0.0% $1,509 $1.61 $1,505 $1.61 0.3%

1 1 943 5 1.2% 0 0.0% $1,442 $1.53 $1,437 $1.52 0.3%

1 1 960 17 4.2% 1 5.9% $1,579 $1.64 $1,574 $1.64 0.3%

1 1 1,003 17 4.2% 1 5.9% $1,532 $1.53 $1,527 $1.52 0.3%

1 1 1,032 17 4.2% 0 0.0% $1,555 $1.51 $1,550 $1.50 0.3%

1 1 1,042 17 4.2% 0 0.0% $1,578 $1.51 $1,573 $1.51 0.3%

1 1 1,081 5 1.2% 0 0.0% $1,571 $1.45 $1,566 $1.45 0.3%

2 2 1,028 42 10.3% 0 0.0% $1,682 $1.64 $1,677 $1.63 0.3%

2 2 1,109 5 1.2% 0 0.0% $1,689 $1.52 $1,684 $1.52 0.3%

2 2 1,112 5 1.2% 0 0.0% $1,723 $1.55 $1,717 $1.54 0.3%

2 2 1,221 9 2.2% 0 0.0% $1,855 $1.52 $1,849 $1.51 0.3%

2 2 1,246 5 1.2% 0 0.0% $1,787 $1.43 $1,781 $1.43 0.3%

2 2 1,258 5 1.2% 0 0.0% $1,960 $1.56 $1,954 $1.55 0.3%

2 2 1,286 19 4.7% 2 10.5% $2,046 $1.59 $2,039 $1.59 0.3%

2 2 1,288 5 1.2% 0 0.0% $1,774 $1.38 $1,769 $1.37 0.3%

2 2 1,310 18 4.4% 0 0.0% $1,975 $1.51 $1,969 $1.50 0.3%

2 2 1,349 5 1.2% 0 0.0% $1,974 $1.46 $1,968 $1.46 0.3%

2 2 1,359 5 1.2% 0 0.0% $2,141 $1.58 $2,134 $1.57 0.3%

2 2 1,401 18 4.4% 0 0.0% $2,000 $1.43 $1,994 $1.42 0.3%

3 2 1,298 13 3.2% 0 0.0% $2,056 $1.58 $2,050 $1.58 0.3%

2 1,376 5 1.2% 0 0.0% $2,091 $1.52 $2,085 $1.51 0.3%

2 1,472 5 1.2% 0 0.0% $2,093 $1.42 $2,086 $1.42 0.3%

2 1,487 16 3.9% 0 0.0% $2,274 $1.53 $2,267 $1.52 0.3%

2 1,570 5 1.2% 1 20.0% $2,396 $1.53 $2,388 $1.52 0.3%

FEES

PET POLICY

Cats Allowed - $300 Deposit, $50/Mo, 2 Maximum, One-Time Fee:

Allowed-$300Deposit,$50/Mo,2Maximum,One-TimeFee:

TRANSPORTATION

TENANTS

Property Summary

County

BUILDING NOTES

Construction finished December 2017.

Unit counts per model are estimated currently.

BUILDING

BEDROOM

FEES

PET POLICY

Property Summary Report

226 Legend Dr - East Pointe Apartments

Valparaiso, IN 46383 - Porter County Submarket

TRANSPORTATION

Parking 110 available (Surface);Ratio of 1.72/Unit

BUILDING NOTES

The bed-bath mix, unit counts and sizes are estimated per property management.

BUILDING

LAND

EXPENSES

BEDROOM SUMMARY

UNIT MIX

Property

FEES

Application Fee

SALE

Sold Price

Date

Sale Type

Financing

TENANTS

Hangman

PET POLICY

Birds Allowed

Cats Allowed -

Allowed

Reptiles Allowed

TRANSPORTATION

Walk

Car-Dependent

BUILDING

EXPENSES

BEDROOM

UNIT

TRANSPORTATION

BUILDING

Property

FEES

PET POLICY

Cats Allowed -

Allowed -

Maximum, MaximumWeight

lb, One-Time Fee:

Maximum, Maximum Weight 25 lb, One-Time

TRANSPORTATION

Parking

available (Surface);Ratio of 0.15/Unit Airport

South Bend Regional Airport Walk Score®

TENANTS

NMI - Rumely Historic Apartments

Masonic Temple & Club Rooms

Sales

BUILDING

LAND

FEES

Application

PET POLICY

Cats Allowed - $0 Deposit, $30/Mo, 2 Maximum, One-Time Fee:

Allowed - $0 Deposit, $30/Mo, 2 Maximum, One-Time Fee:

TRANSPORTATION

Parking

available (Surface);64 available (Covered);Ratio of 1.66/Unit

min

to South Bend Regional Airport

Score® Car-Dependent (24)

BUILDING

EXPENSES

BEDROOM

Property

FEES

Application

SALE

Sold Price $5,614,178 ($87,722/Unit)

Date Dec

Type

Financing

TENANTS

Mortgage: US Bank

$5,800,000/-

PET POLICY

Cats Allowed - $299 Deposit, $29/Mo, 2 Maximum,

Allowed - $299 Deposit, $29/Mo, 2 Maximum, Maximum Weight 80 lb,

TRANSPORTATION

Goodwill 13,000 SF

BUILDING

BEDROOM SUMMARY

$1.26

$1.03

$0.85

UNIT MIX

$0.76

$0.93

FEES

PET POLICY

lb,

Property Summary Report

310 Skylane Dr - Northpointe and Lakepointe

Plymouth, IN 46563 - Indiana North Area Submarket

SALE

Sold Price $130,213 - Part of Portfolio

Date Jun 2018

Sale Type Investment

Cap Rate 7.26%

Properties 14

TRANSPORTATION Airport

36 min drive to South Bend Regional Airport Walk Score®

Somewhat Walkable (50)

BUILDING

LAND

EXPENSES

BEDROOM

UNIT MIX

Property

$1.38

$1.40

$927 $1.37 0.2%

$929 $1.08 0.2%

$1.07 0.2%

FEES

SALE

Sold Price $4,700,000 ($30,128/Unit)

Date Aug 2020

PET POLICY

Cats Allowed - $0 Deposit, $29/Mo, 2 Maximum, One-Time Fee: $299

Dogs Allowed - $0 Deposit, $29/Mo, 2 Maximum, MaximumWeight 80 lb, One-Time Fee: $299

TRANSPORTATION

Parking 630 available (Surface);Ratio of 4.04/Unit Walk Score® Somewhat Walkable (57) Transit Score® Minimal Transit (22)

BUILDING

EXPENSES

BEDROOM SUMMARY

Property

Village Apartments

UNIT MIX

Models

Beds

FEES

Admin

Application

Asking

Avg Effective Rent

$1,029 $1.58

$1,197 $1.41

$1,413 $1.32

PET POLICY

Cats Allowed - $500 Deposit, $50/Mo, 2 Maximum, Maximum Weight 50 lb,

Dogs Allowed - $500 Deposit, $50/Mo, 2 Maximum, Maximum Weight 50 lb, Others Allowed -

TRANSPORTATION

Walk

Transit

TENANTS

L

Combs

BEDROOM SUMMARY

UNIT MIX

Beds

Asking Rent Avg Effective Rent Concessions

$1.63

$1,125 $1.63

$1,170 $1.67

$1,125 $1.54 0.0%

$1,125 $1.51

$1,385 $1.36

$1,450 $1.38

Property

402 Truesdell Ave -The Banks

Porte,

46350 - South Bend/Elkhart

Models Counts

Beds Baths Avg

1,113

2 1,127

1,159

2 1,275

FEES

Admin Fee $150

Application Fee $50

Storage Fee $50

TRANSPORTATION

Airport

16.0%

1.5%

1.5%

1.5%

Asking Rent Avg Effective Rent Concessions

Unit

SF Per Unit Per SF %

3.2% $1,485 $1.33 $1,485 $1.33 0.0%

$1,595 $1.42 $1,595 $1.42 0.0%

$1,670 $1.44 $1,670 $1.44 0.0%

$1,715 $1.35 $1,715 $1.35 0.0%

PET POLICY

Cats Allowed - $25/Mo, 2 Maximum, One-Time Fee: $300

Dogs Allowed - $25/Mo, 2 Maximum, One-Time Fee: $300

40 min drive to South Bend Regional Airport

Walk Score® Car-Dependent (49)

BUILDING

LAND

EXPENSES

BEDROOM

Property

PET POLICY

SALE

TRANSPORTATION

BUILDING NOTES

BUILDING

FEATURES

BEDROOM SUMMARY

UNIT MIX

Property

FEES

PET POLICY

Cats

- $29/Mo,

Maximum, One-Time Fee: $299

Maximum, Maximum Weight 80 lb,

TRANSPORTATION

BUILDING NOTES

BUILDING

BEDROOM

UNIT MIX

Property

FEES

Application

TRANSPORTATION

Airport

PET POLICY

Cats Allowed -

1 Maximum, MaximumWeight

Dogs Allowed - $0 Deposit, $30/Mo, 1 Maximum, MaximumWeight

South

Regional

BUILDING

BEDROOM

Property

TRANSPORTATION

BUILDING

BEDROOM

Property

FEES

PET POLICY

TRANSPORTATION

Property

Country Acres Apartments

TRANSPORTATION

Airport

Walk

BUILDING NOTES

Section-8

South

Car-Dependent

Regional

BUILDING

BEDROOM SUMMARY

Totals

UNIT MIX

TRANSPORTATION

BUILDING

LAND

BEDROOM

UNIT MIX

TRANSPORTATION

BUILDING

BEDROOM

UNIT MIX

Property Summary Report

IN 46350 - South Bend/Elkhart

TRANSPORTATION

of LaPorte

Parking 100 available (Surface);Ratio of 0.75/Unit Airport 41 min drive to South Bend Regional Airport

BUILDING NOTES

The unit counts by bed-bath mix are estimated per property management.

BEDROOM

TRANSPORTATION

BUILDING

Type

Metering

Metered

LAND

46-06-35-442-012.000-043

EXPENSES

Site Amenities

PET POLICY

SALE

TRANSPORTATION

($13,478/Unit)

BEDROOM SUMMARY

SALE

TRANSPORTATION

BEDROOM SUMMARY

UNIT MIX

TRANSPORTATION

TENANTS

Competitive Set Data Summary

For the purposes of this Comprehensive Multi-Family Market Feasibility Study, the competitive set includes properties that were determined could be competitive with the proposed multi-family development project based on either their location, facilities/amenities offered, rate, size, and/or market orientation. Additionally, HCA must follow specific guidelines in order to access accurate CoStar data. The following section offers information on each competitive hotel. This information includes but is not limited to:

Key Data Metrics

Availability

Sales Past Year

Inventory

Demand

Key Performance Metrics

Market Asking Rent Per Unit

Market Rent Growth

Market Rent Per Unit & Rent Growth

Market Asking Rent Per Unit by Bedroom

Market Asking Rent Per Square Foot

Market Effective Rent Per Unit

Market Asking Rent Per Square Foot by Bedroom

Concession Rate

Market Effective Rent per Unit by Bedroom

Daily Asking Rent Per Square Foot Vacancy & Market Asking Rent Per Unit Vacancy Rate

Overall & Stabilized Vacancy Stabilized Vacancy Rate

Daily Vacancy Rate

Occupancy Rate

Absorption, Net Deliveries & Vacancy

Occupancy & Market Rent Per Unit

Occupancy At Delivery

Total Units by Bedroom Absorption Units

Construction Starts

All data is provided by the CoStar Group and was updated in October of 2022.

Competitive Set Data Summary (continued…)

Key Performance Metrics (continued…)

Under Construction

Deliveries

Deliveries & Demolitions

Demolitions

Sale Volume & Market Sales Price Per Unit

Sale Volume By Transaction Type

Sale Volume

Sale Price Per Unit

Sale Price Per Unity by Transaction Type

Sales to Asking Price Differential

Sale Price Per Unity by Location Type

Cap Rate

Cap Rate by Transaction Type

Market Cap Rate

Cap Rate by Location Type

Market Cap Rate & Transaction Cap Rate

Market Cap Rate Distribution

Market Cap Rate By Star Rating

Market Cap Rate by Location Type

Market Sale Price Per Unit

Market Sale Price & Transaction Sale Price Per Unit

Market Sale Price Per Unit By Location Type

Market Sale Price Per Unit Distribution

Market Sale Price Per Unit by Star Rating

Top Buyers

Top Sellers

Top Buyer Brokers

Top Seller Brokers

Asset Value By Owners Type

Sales By Sellers Type

Sales by Buyers Type

Sales Volume By Buyers Type

Sales Volume by Seller Type

Asset Value By Owner Origin

Net Buying & Selling By Owner Type

Sales Volume By buyer Origin

All data is provided by the CoStar Group and was updated in October of 2022.

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Market and Submarket Overview

For the purposes of this Comprehensive Multi-Family Market Feasibility Study, the competitive set included properties that were determined could be competitive with the proposed multi-family development project based on either their location, facilities/amenities offered, rate, size, and/or market orientation. Additionally, HCA researched the overall market. The Market Overview and Submarket Overview, review the following information in regard to the parameters in each market:

Market Key Statistics

Vacancy Rent

Construction

Under Construction Properties Sales Sales Past 12 Months

Economy Market Submarkets

Supply & Demand Trends

Vacancy & Rents

Sales Trends

Deliveries & Under Construction

All data is provided by the CoStar Group and was updated in October of 2022.

0 58 1.4% 4.7%

Apartment rents in the Plymouth Market were rising at a 4.7% annual rate during the fourth quarter of 2022, and have posted an average annual gain of 3.4% over the past three years. While 130 units have delivered over the

KEY INDICATORS

past three years (a cumulative inventory expansion of 15.9%), nothing is currently underway. Vacancies in the metro were well below the 10-year average as of 2022Q4, and trended down over the past four quarters.

Change (YOY)

-5.9%

Q4 0.9% 2022 Q2

Absorption Units 154 2022 Q1 (4) 2004 Q1

Delivered Units 134 2022 Q2 0 2022 Q3

Demolished Units 0 2022 Q3 0 2022 Q3

Rent Growth (YOY)

Rent Growth (YOY)

Volume

1.4%

1.5%

2022 Q2 -2.4% 2009 Q4

2022 Q4 -2.4% 2009 Q4

2019 Q1 $0 2022 Q3

VACANCY BY BEDROOM

MARKET RENT PER UNIT & RENT GROWTH

Under

Properties

Sales

Plymouth is firmly cemented as one of the country's smallest multifamily markets, and investment activity matched that position with one sale in the past year. That was par for the course in Plymouth, as it largely matched typical activity here over the past five years.

The market price, which is based on the price movement of every market-rate community in the metro, is close to $62,000/door during the fourth quarter of 2022. That

SALES VOLUME & MARKET SALE PRICE PER UNIT

Plymouth Multi-Family

figure is up over this time last year, and the price is a large discount relative to the average apartment price in the United States. In fact, the Plymouth average market price is only a fraction of the U.S. average. The market cap rate has dropped since last year. It is the lowest cap rate that has been seen in Plymouth during the past five years, and the cap rate is structurally higher here than those across the country.

DEMOGRAPHIC TRENDS

Demographic Category

Current Level Metro USMetro US

12 Month Change

10 Year Change Metro US Metro US

5 Year Forecast

Population 332,589,813 0.2% 0.6% 0.5%

Households 124,151,406 0.1% 0.7% 0.5%

Median Household Income $74,739 9.0% 3.9% 3.1%

Labor Force 165,095,391 2.2% 0.6% 0.4%

Unemployment 3.6% -1.5% -0.5%

POPULATION GROWTH

Source: Oxford Economics

LABOR FORCE GROWTH INCOME GROWTH

Source: Oxford Economics

OVERALL SUPPLY & DEMAND

AbsorptionInventory

Units % of Inv Construction RatioUnits Growth % GrowthYear

2026 31 3.0%1,050 26 2.5% 1.2

27 2.7%1,019 20 2.0% 1.4

15 1.5%992 9 0.9% 1.7

0 0%977

0%

(2) -0.2%977 10 1.0%

YTD 0 0%979 11 1.1% 0

134 15.9%979 151 15.4% 0.9

0 0%845 49 5.8% 0

24 2.9%845 4 0.5% 6.0

0 0%821 0 0%

0 0%821

0 0%821

0 0%821

0.2% 0

0.1% 0

0.1% 0

0 0%821 0 0%

0 0%821 0 0%

0 0%821 2 0.2% 0

0 0%821 4 0.5% 0

0 0%821 0 0%

4 & 5 STAR SUPPLY & DEMAND

AbsorptionInventory

Units % of Inv Construction RatioUnits Growth % GrowthYear

2026 31 37.8%113 28 24.8% 1.1

27 49.1%82 21 25.6% 1.3

15 37.5%55 9 16.4% 1.7

0 0%40 0 0%

0 0%40 2 5.0% 0

0 0%40 2 5.0% 0

0 0%40 9 22.5% 0

0 0%40 0 0%

0%40 0 0%

0%40 0 0%

0%40 0 0%

0%40 0 0%

0%40 0 0%

0%

0%

0%

0%

0%

0%

0 0%

0%

0%

3 STAR SUPPLY & DEMAND

AbsorptionInventory

Units % of Inv Construction RatioUnits Growth % GrowthYear

2026 0 0%644 (2) -0.3% 0

0 0%644 (1) -0.2% 0

0 0%644 0 0%

0 0%644 0 0%

0 0%644 7 1.1% 0

YTD 0 0%644 8 1.2% 0

134 26.3%644 127 19.7% 1.1

0 0%510 27 5.3% 0

0 0%510 5 1.0% 0

0 0%510 0 0%

0 0%510 2 0.4% 0

0 0%510 1 0.2% 0

0 0%510 1 0.2% 0

0 0%510 0 0%

0 0%510 0 0%

0 0%510 2 0.4% 0

0 0%510 4 0.8% 0

0 0%510 0 0%

1 & 2 STAR SUPPLY & DEMAND

AbsorptionInventory

Units % of Inv Construction RatioUnits Growth % GrowthYear

2026 0 0%293 0 0%

0 0%293 0 0%

0 0%293 0 0%

0 0%293 0 0%

(2) -0.7%293 1 0.3%

YTD 0 0%295 1 0.3% 0

0 0%295 15 5.1% 0

0 0%295 22 7.5% 0

24 8.9%295 (1) -0.3%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

0 0%271 0 0%

OVERALL VACANCY & RENT

Market RentVacancy

Per Unit Per SF % GrowthUnits Percent Ppts ChgYear

Effective Rents

Units Per SFPpts Chg

(0.6)

2023 1.6% 0.116 $883 $1.09 4.3% $882 $1.08

2026 3.4% 0.436 $944 $1.16 1.6% $944 $1.16 (0.8)2025 3.0% 0.631 $929 $1.14 2.2% $929 $1.14 (1.3)2024 2.4% 0.824 $909 $1.12 3.0% $909 $1.12 (1.4)

2.22022 1.6% (0.9)15 $846 $1.04 5.7% $846 $1.04

1.1YTD 1.4% (1.0)14 $838 $1.03 4.7% $834 $1.03

2.72021 2.4% (2.3)24 $800 $0.98 3.6% $784 $0.96 (2.4)2020 4.7% (5.9)40 $773 $0.95 0.9% $770 $0.95

2.42019 10.7% 2.290 $766 $0.94 3.3% $762 $0.94 (2.7)2018 8.4% 069 $741 $0.91 0.9% $736 $0.90

2.02017 8.4% (0.4)69 $734 $0.90 3.7% $729 $0.90 (0.1)2016 8.8% (0.2)72 $708 $0.87 1.6% $703 $0.86

0.52015 9.0% (0.2)74 $697 $0.86 1.7% $690 $0.85

02014 9.2% 076 $685 $0.84 1.2% $680 $0.84 (0.1)2013 9.3% (0.2)76 $677 $0.83 1.1% $672 $0.83

0.62012 9.5% (0.5)78 $670 $0.82 1.2% $665 $0.82

0.52011 10.0% (0.7)82 $662 $0.81 0.6% $657 $0.81

2010 10.7% 088 $658 $0.81 0% $653 $0.80

4 & 5 STAR VACANCY & RENT

Year

Market RentVacancy

Per Unit Per SF % GrowthUnits Percent Ppts Chg

Effective Rents

Units Per SFPpts Chg

(0.3)

13.2% 13.07 $1,921 $1.75 1.9% $1,921 $1.75

2026 13.7% (2.0)15 $1,945 $1.77 0.5% $1,945 $1.77 (1.1)2025 15.6% 2.413 $1,935 $1.76 0.7% $1,935 $1.76 (2.4)

2.32023 0.2% 0.10 $1,886 $1.72 4.3% $1,886 $1.72

1.22022 0.1% (4.0)0 $1,809 $1.65 2.0% $1,809 $1.65

YTD 0% (4.2)0 $1,788 $1.63 1.2% $1,784 $1.62

0.3

0.32021 4.2% (21.0)2 $1,773 $1.61 0.8% $1,763 $1.60 (0.9)2020 25.2% (0.8)10 $1,758 $1.60 0.5% $1,741 $1.58

0.42019 26.0% 010 $1,749 $1.59 1.4% $1,732 $1.57

26.0% (0.2)10 $1,725 $1.57 1.0%

0.3

$1,707 $1.55

0.1

26.8% (0.5)11 $1,695 $1.54 0.7% $1,677 $1.53

26.2% (0.6)10 $1,707 $1.55 0.7% $1,690 $1.54 (1.7)

1.9

27.4% 011 $1,644 $1.49 0.5% $1,627 $1.48

27.3% (0.2)11 $1,683 $1.53 2.4% $1,666 $1.52 (1.2)

27.4% (0.3)11 $1,635 $1.49 1.7% $1,618 $1.47

0.1

0.6

27.7% (1.2)11 $1,607 $1.46 1.7% $1,591 $1.45

28.9% (1.0)12 $1,581 $1.44 1.0% $1,565 $1.42

1.0

30.0% 0.212 $1,565 $1.42 0% $1,549 $1.41

Market RentVacancy

Per Unit Per SF % GrowthUnits Percent Ppts ChgYear

Effective Rents

Units Per SFPpts Chg

(0.6)

2026 2.7% 0.317 $886 $1.12 2.0% $885 $1.12 (0.8)2025 2.4% 0.115 $868 $1.10 2.6% $867 $1.10 (1.2)2024 2.3% 0.115 $846 $1.07 3.4% $845 $1.07 (2.4)2023 2.2% 0.114 $818 $1.04 4.6% $817 $1.04

4.12022 2.1% (1.1)14 $782 $0.99 7.0% $782 $0.99

2.9YTD 1.9% (1.3)12 $773 $0.98 5.8% $770 $0.98

0.22021 3.2% 0.820 $731 $0.93 2.9% $710 $0.90 (0.8)2020 2.4% (5.3)12 $710 $0.90 2.8% $708 $0.90

2.82019 7.8% (0.9)40 $691 $0.88 3.6% $688 $0.87 (3.4)2018 8.6% 0.344 $667 $0.85 0.8% $662 $0.84

2.82017 8.4% (0.3)43 $662 $0.84 4.2% $657 $0.83 (0.4)2016 8.7% (0.2)44 $636 $0.81 1.3% $631 $0.80

0.32015 8.9% (0.4)45 $627 $0.80 1.7% $620 $0.79

0.32014 9.2% (0.1)47 $617 $0.78 1.4% $612 $0.78 02013 9.3% (0.2)47 $608 $0.77 1.1% $604 $0.77

0.72012 9.5% (0.5)49 $601 $0.76 1.2% $597 $0.76

0.42011 10.0% (0.7)51 $595 $0.75 0.5% $590 $0.75

2010 10.7% 055 $592 $0.75 0% $587 $0.74

1 & 2 STAR VACANCY & RENT

Year

Market RentVacancy

Per

Effective Rents (0.6)

Units Per

2026 1.1% 0.33 $909 $1.09 0.9% $909 $1.09 (0.7)2025 0.9% 0.13 $901 $1.08 1.5% $901 $1.08 (1.2)2024 0.7% 0.12 $887 $1.06 2.2% $887 $1.06 (0.1)

2023 0.6% 0.12 $868 $1.04 3.4% $868 $1.04 (3.9)

2022 0.5% 02 $840 $1 3.5% $840 $1 (4.5)

YTD 0.4% (0.1)1 $834 $1 2.9% $832 $1

12.42021 0.5% (5.4)1 $811 $0.97 7.4% $809 $0.97 (8.7)

5.9% (7.7)17 $755 $0.90 -5.0% $754 $0.90

2.32019 13.6% 8.140 $795 $0.95 3.7% $790 $0.95 (2.3)

5.5% (0.4)15 $767 $0.92 1.4% $762 $0.91

5.9% (0.5)16 $756 $0.90 3.7% $752 $0.90

0.4

6.4% (0.3)17 $729 $0.87 3.3% $724 $0.87

6.7% 0.118 $705 $0.84 1.2% $701 $0.84

0.5

6.6% 018 $697 $0.83 0.7% $692 $0.83

6.6% (0.2)18 $692 $0.83 0.9% $687 $0.82

6.8% (0.5)18 $686 $0.82 1.1% $681 $0.82

7.3% (0.6)20 $678 $0.81 0.5% $674 $0.81

7.9% (0.1)21 $675 $0.81 0% $670 $0.80

OVERALL SALES

Completed Transactions (1)

Market Pricing Trends (2)

Turnover

Avg Price

Avg Price/UnitDeals VolumeYear

Avg Cap Rate Price/Unit Cap Rate

Price Index

2026 277$68,972 6.9%

2025 274$68,192 6.9%

2024 270$67,070 6.9%

2023 262$65,160 6.8%

2022 253$62,874 6.8%

YTD $01 1.1% 250$62,216 6.8%

2021 233$57,978 6.9%

2020 $390K2 8.2% $43,333$390,000 211$52,433 7.0%

2019 $750K1 2.8% $31,250$750,000 193$47,982 7.5%

2018 $2.1M9 36.2% $7,176$236,798 18213.0% $45,236 7.7%

2017 $01 0.9% 170$42,226 7.9%

2016 162$40,306 8.0%

2015 $02 1.7% 153$37,975 8.1%

2014 145$36,133 8.2%

2013 135$33,670 8.5%

2012 135$33,653 8.4%

2011 $589.4K1 2.9% $24,559$589,406 13111.0% $32,641 8.4%

(1) Completed transaction data is based on actual arms-length sales transactions and levels are dependent on the mix of what happened to sell in the period.

(2) Market price trends data is based on the estimated price movement of all properties in the market, informed by actual transactions that have occurred.

4 & 5 STAR SALES

Avg Price/UnitDeals VolumeYear

Completed Transactions (1) Turnover

Market Pricing Trends (2) Avg Price Price IndexAvg Cap Rate Price/Unit Cap Rate

2026 281$160,008 6.4%

2025 281$159,970 6.4%

2024 280$159,626 6.4%

2023 275$156,746 6.3%

2022 265$151,305 6.3%

YTD 263$149,801 6.3%

2021 252$143,374 6.3%

2020 232$131,975 6.3%

2019 217$123,767 6.6%

2018 205$116,655 6.8%

2017 188$107,417 7.1%

2016 181$102,930 7.1%

2015 168$95,976 7.3%

2014 158$90,303 7.5%

2013 147$83,689 7.8%

2012 145$82,686 7.7%

2011 139$79,284 7.7%

(1) Completed transaction data is based on actual arms-length sales transactions and levels are dependent on the mix of what happened to sell in the period.

(2) Market price trends data is based on the estimated price movement of all properties in the market, informed by actual transactions that have occurred.

3 STAR SALES

Completed Transactions (1)

Turnover

Avg Price/UnitDeals VolumeYear

Market Pricing Trends (2) Avg Price Price Index

Avg Cap Rate Price/Unit Cap Rate

2026 278$64,886 6.8%

2025 274$63,934 6.8%

2024 269$62,646 6.7%

2023 260$60,650 6.7%

2022 250$58,386 6.7%

YTD 248$57,749 6.6%

2021 231$53,841 6.7%

2020 $01 11.8% 209$48,758 6.9%

2019 192$44,670 7.3%

2018 $1.2M7 48.2% $4,696$165,037 180$42,058 7.5%

2017 169$39,441 7.7%

2016 162$37,673 7.8%

2015 152$35,468 7.9%

2014 145$33,766 8.1%

2013 135$31,463 8.3%

2012 135$31,557 8.2%

2011 131$30,538 8.2%

(1) Completed transaction data is based on actual arms-length sales transactions and levels are dependent on the mix of what happened to sell in the period.

(2) Market price trends data is based on the estimated price movement of all properties in the market, informed by actual transactions that have occurred.

1 & 2 STAR SALES

Completed Transactions (1)

Turnover

Avg Price/UnitDeals VolumeYear

Market Pricing Trends (2) Avg Price Price IndexAvg Cap Rate Price/Unit Cap Rate

2026 274$65,548 7.3%

2025 272$65,044 7.2%

2024 268$64,178 7.2%

2023 262$62,589 7.2%

2022 254$60,682 7.1%

YTD $01 3.7% 251$60,093 7.1%

2021 232$55,431 7.3%

2020 $390K1 3.1% $43,333$390,000 208$49,671 7.4%

2019 $750K1 8.1% $31,250$750,000 188$44,937 8.0%

2018 $975.9K2 18.8% $19,136$487,961 17813.0% $42,490 8.2%

2017 $01 2.6% 165$39,469 8.4%

2016 157$37,560 8.5%

2015 $02 5.2% 149$35,584 8.7%

2014 142$33,956 8.8%

2013 133$31,704 9.1%

2012 132$31,579 9.0%

2011 $589.4K1 8.9% $24,559$589,406 12911.0% $30,906 8.9%

(1) Completed transaction data is based on actual arms-length sales transactions and levels are dependent on the mix of what happened to sell in the period.

(2) Market price trends data is based on the estimated price movement of all properties in the market, informed by actual transactions that have occurred.

DELIVERIES & UNDER CONSTRUCTION

Net Deliveries

1,051 3.4%

1,020 3.0%

993 2.4%

978 1.6%

978 1.6%

979 1.4%

979 2.4%

845 4.7%

845 10.7%26

821 8.4%25

821 8.4%25

821 8.8%25

821 9.0%25

821 9.2%25

821 9.3%25

821 9.5%25

821 10.0%25

821 10.7%25

24

0

Construction

0

0 0

1 134

1 134

1 24

1 24

0 0

0 0

0 0

0 0

0 0

0 0

0 0

Recommendations

HCA estimates, there is a potential demand for 70 to 90 new, market rate rental units available to the proposed location. Taking into consideration of the information in the report as well as the fact that there has been no new development in the Knox, IN market, the overall Market and Median Rental Rates and the occupancy rate we feel the 78 units in Knox, Indiana will make good business sense.

Using a conservative rent to income ratio of four to one, renter households need a household income of close to $38,832 to qualify for the current, 12 month average rent of $809 (previous 12 month average rent was $740) in the market of Knox. Using a the industry standard rent to income ratio of a three to one, renter households need a household income of close to $29,124 to qualify for the current, 12 month average rent. The average income for households in the market, however, is over $62,745 within five miles of the proposed location in 2022. That means that the average household in the market can afford rents of closer to $1,307 per month conservatively at 25% of total income. In a typical ratio of three to one or 33%, over half the market could afford more than $1,725 per month.

One, two, and three bedroom units should be featured. We advise the one-bedroom floor plans offer between 700 and 850 square feet. We advise two-bedroom floor plans offer between 900 and 1100 square feet. We advise three-bedroom floor plans offer between 1100 and 1300 square feet. Monthly rents should be between $950 and $1,050 for the one-bedroom units, $1,200 and $1,275 for the two-bedroom units, and $1,400 to $1,500 for three-bedroom units per month. If the product is successfully developed at these rents and units sizes, and the site is fully marketed, the proposed 70 to 90 units will lease up in less than 18 months.

Source: Opinion of HCA

Subject Property Analysis of Potential New Build

The objectives of this study/report is to gain a better understanding of both the potential need of additional apartment units in the community of Knox, IN and profitability of a "proposed property" highlighted in this study.

A multi-family or apartment complex in the vicinity of Highway 35 (Subject) would be a proposed new construction, apartment complex with 78 market-rate units. The community of Knox is located in the center area of Starke County and the northern area of Indiana. Overall, access and traffic flow to the site and/or vicinity of potential location/s are considered good.

Source: Indiana Department of Transportation 2021

Subject Property Analysis

Construction/Development Costs

Construction/Development

including

The Subject will

is

cost)

estimated based on costs of recent

unit building will costs $6,825,000

can

Unit Mix/Availability/Pricing*

two-bedroom units,

Number of

Bedroom/1 Bath per

Bedroom/2 Bath per

Competitive Set Average

Monthly Price

Bedroom/2 Bath per Month

three-

Price Per Square Foot

943.00

1,089.00

1,400.00

When considering the lack of new product, current condition of competitive properties and overall area properties, markets vacancy rate of 2.7% in the last 12 months as of September in 2022 (previous average of 2.2%) and the projected marginal population increase, it is the opinion of HCA that the proposed property has the opportunity to maintain the following occupancy percentage over the next five years:

Proposed Property Projected Occupancy

One

Two

Three

95.0%

96.0%

Year Four 97.0%

Year Five 97.5%

Proposed Property Projected Revenue (w/o rent increases)

1,032,192.00

1,042,944.00

1,048,320.00

When considering the lack of product, current condition of competitive properties, and overall area properties, markets five-year average rental rate growth and the projected marginal population increase, it is the opinion of HCA that the proposed property has the opportunity to grow rental rates over the next five years and obtain revenue as follows:

Property Projected Revenue (with rent

Proposed Property Projected Occupancy

One

to

noted the proposed property

weather patterns

have

1.0% 16,269.93

Rental Loss Due to

Management Company Fee

Contract Services

Accounting Services

Repairs & Maintenance

Equipment and Supplies

Utilities

Advertising/Marketing

10,214.40

1.0% 10,631.58

1.0% 10,738.83

1.50% 16,353.79$ 1.50%

1.0% 10,846.62$ 1.0% 10,902.53$ 1.0%

30,643.20$ 3.0% 31,894.73$ 3.0% 32,216.49$ 3.0% 32,539.85$ 3.0% 32,707.58$ 3.0%

10,214.40$ 1.0% 10,631.58$ 1.0% 10,738.83$ 1.0% 10,846.62$ 1.0% 10,902.53$ 1.0%

5,107.20$ 0.5% 5,315.79$ 0.5% 5,369.41$ 0.5% 5,423.31$ 0.5% 5,451.26$ 0.5%

2,553.60$ 0.25% 5,315.79$ 0.5% 5,369.41$ 0.50% 8,134.96$ 0.75% 10,902.53$ 1.00%

2,553.60$ 0.25% 2,657.89$ 0.25% 5,369.41$ 0.5% 5,423.31$ 0.5% 5,451.26$ 0.5%

45,964.80$ 4.5% 47,842.10$ 4.5% 51,009.44$ 4.75% 54,233.09$ 5.0% 54,512.64$ 5.0%

5,107.20$ 0.5% 5,315.79$ 0.5% 5,369.41$ 0.5% 8,134.96$ 0.75% 10,902.53$ 1.0%

163,430.40

16.0% 175,421.03

16.5% 185,244.80

17.3%

Economic Impact

As stated previously, Economic Impact is an important aspect when reviewing a potential development. Although there is additional impact, some cannot me quantified. For the purpose of this study, HCA reviewed local Transportation, Health Care, Food, Child Care, and Tax Costs associated with living in the Market. Knox is a city in Starke County, Indiana, with a population of 3,609. The total cost of housing, food, child care, transportation, health care, taxes, and other necessities for a single adult in Knox is $33,836 a year, about the same as the annual cost of living for Indiana of $32,867 yet less than the national figure of $38,433. These costs are broken down as follows:

Transportation Costs in Knox, Indiana - Transportation can also be a significant component of cost of living. In Knox, 97.90% of commuters drive to work, compared to 85.5% of commuters nationwide. An estimated 49.00% of workers commute to jobs outside of Knox, a larger share than the 43.7% share of commuters nationwide who live and work in different cities. The average commute in Knox is 22.9 minutes long, compared to the 26.6minute average commute nationwide. Taking into account the cost of gas, as well as public transit and car maintenance, the EPI estimates that a single person in Knox spends $11,463 a year on transportation, more than the national average of $9,760.

Healthcare Costs in Knox, Indiana - Out-of-pocket health care costs and insurance premiums, assuming at least a basic level of health insurance coverage are slightly lower than they are on average nationwide in Knox but in line with what they are across Indiana as a whole. For a single adult living in the area, average health care costs come out to $3,848 per year, compared to an average of $3,836 across Indiana and $4,266 nationwide.

Food Costs in Knox, Indiana - Food is another every day expense that has a significant impact on overall cost of living. Data from the U.S. Department of Agriculture shows that the cost of food varies from city to city and town to town. In Knox, a single adult spends an average of $3,038 on food annually, and a family of four spends $8,773 on average. For context, average annual food expenditure across Indiana and the U.S., respectively, are $2,872 and $3,240 for a single adult, and $8,295 and $9,354 for a family of four. These estimates are calculated for a nutritionally adequate diet of food purchased at a grocery store for at-home preparation.

Economic Impact (continued)

Income Taxes in Knox, Indiana - Few expenses vary as much from city to city and town to town as taxes. Accounting for state and federal income taxes, as well as Social Security contributions and Medicare payroll taxes, the average adult working in Knox, Indiana pays $5,572 annually — closely in line with the statewide average of $5,366. It is important to note that these calculations do not include other common taxes such as property, sales, and excise taxes. Accounting for these taxes, while excluding taxes levied at the federal level, Knox residents live in a state with a low average tax burden. Per capita state tax collections in Indiana total $2,899 per year, compared to the $3,151 average across all states.

When considering the highlighted Economic Impact categories, based on an average of 2 people living in each unit, the estimated amounts per single person, and the amount of new units, the following growth due to this development can be estimated:

Transportation Economic Impact

Health Care Economic Impact

Food Economic Impact*

Income Taxes Economic Impact

$ 1,788,228.00

$ 600,288.00

$ 3,038.00

$ 869,232.00

Additionally, Child Care Costs could be considered when reviewing the impact of this development. Child Care Costs in Knox, Indiana for families with children, child care adds thousands of dollars to overall annual spending. In Knox, the average annual cost of child care for two children one 4 year old and one 8 year old is $12,432, about $4,500 less than the comparable average of $16,924 across all of Indiana. Meanwhile, across the U.S. as a whole, childcare expenses for two children averages $15,853 per year. If there were an average of one child per unit, this would come out to an estimated impact of:

Child Care Economic Impact

$ 484,848.00

When considering all five of the above categories, the total estimated Economic Impact of the proposed project is:

Total Estimated Annual Economic Impact of 78 New Build Units in Knox $ 3,745,634.00

*Based on two single people at $3,027. Source - 247WallST

Glossary of Terms

Administrative - Total monies spent on general and administrative items such as answering service, donations, mileage reimbursement, bank charges, legal/eviction charges, postage, telephone/fax/Internet charges, office supplies, uniforms, credit reports, permits, membership dues, subscriptions, data processing, etc. Does not include any payroll-related expenses.

Capital Expenditures/Reserve for Replacement - Capital Expenditures are separated by the categories listed (renovations, replacements and “other”). All “other” Capex expenses would include the sum of any items not specifically listed above. A zero on the line meant there were no capital expenditures.

Contract Services - Contract Services are separated by the categories listed (landscaping, pest control, security and “other”). All “other” contract services expenses would include the sum of any items not specifically listed above (ex. Snow removal, and other services provided on a contract basis). Trash removal is not included here.

Insurance - Includes property hazard and liability and real property insurance and does not include health/payroll insurance.

Maintenance/Repairs - Total monies spent on general maintenance, maintenance supplies and uniforms, minor painting/carpeting repairs, plumbing supplies and repairs, security gate repairs, keys/locks, minor roof/window repairs, HVAC repairs, cleaning supplies, etc. Does not include any payroll related expenses or non-recurring capital expenses. Contract services are reported separately.

Management Fees - Total fees paid to the management agent/company by the owner.

Marketing - Marketing expenses are separated by the categories listed (internet, print, resident relations and “other”). All “other” marketing expenses would include the sum of any items not specifically listed above. (i.e.,. locator fees, signage, model expense, etc.).

Other Revenue - Monies received are separated by the categories listed (amenity fees, laundry, parking, pet fees, storage and “other”). All “other” would include the sum of any items not specifically listed above. (i.e., vending, deposit forfeitures, furniture, late fees, termination fees, application fees, etc.).

Glossary of Terms (continued)

Payroll Costs - Gross salaries and wages paid to employees assigned to the property in all departments. Includes payroll taxes, group health/life/disability insurance, 401(k), bonuses, leasing commissions, value of employee apartment allowance, workers’ compensation, retirement contributions, overtime and other cash benefits.

Revenue Losses to Collections - Amount of residential rents not received due to collection losses.

Revenue Losses to Concessions - Amounts of gross potential residential rents not received due to concessions.

Taxes - Total real estate and personal property taxes only. Does not include payroll or rendering fees related to property taxes or income taxes.

Utilities - Total cost of all standard utilities and each listed type, net of any income reimbursements for or from residents (i.e., submeter, RUBS, flat fee or similar system).

Assumptions and Limiting Conditions

1. In the event that the client provided a legal description, building plans, title policy and/or survey, etc., the consultant has relied extensively upon such data in the formulation of all analyses.

2. The legal description as supplied by the client is assumed to be correct and the author assumes no responsibility for legal matters, and renders no opinion of property title, which is assumed to be good and merchantable.

3. All encumbrances, including mortgages, liens, leases, and servitudes, were disregarded in this valuation unless specified in the report. It was recognized, however, that the typical purchaser would likely take advantage of the best available financing, and the effects of such financing on property value were considered.

4. All information contained in the report, which was furnished by others, was assumed to be true, correct, and reliable. A reasonable effort was made to verify such information, but the author assumes no responsibility for its accuracy.

5. The report was made assuming responsible ownership and capable management of the property.

6. The sketches, photographs, and other exhibits in this report are solely for the purpose of assisting the reader in visualizing the property. The author made no property survey, and assumes no liability in connection with such matters. It was also assumed there is no property encroachment or trespass unless noted in the report.

7. The author of this report assumes no responsibility for hidden or unapparent conditions of the property, subsoil, or structures, or the correction of any defects now existing or that may develop in the future. Equipment components were assumed in good working condition unless otherwise stated in this report.

8. It is assumed that there are no hidden or unapparent conditions for the property, subsoil, or structures, which would render it more or less valuable. No responsibility is assumed for such conditions or for engineering, which may be required to discover such factors.

9. The investigation made it reasonable to assume, for report purposes, that no insulation or other product banned by the Consumer Product Safety Commission has been introduced into the Subject premises. Visual inspection by the consultant did not indicate the presence of any hazardous waste. It is suggested the client obtain a professional environmental hazard survey to further define the condition of the Subject soil if they deem necessary.

Assumptions and Limiting Conditions

10. Any distribution of total property value between land and improvements applies only under the existing or specified program of property utilization. Separate valuations for land and buildings must not be used in conjunction with any other study or appraisal and are invalid if so used.

11. A valuation estimate for a property is made as of a certain day. Due to the principles of change and anticipation, the value estimate is only valid as of the date of valuation. The real estate market is nonstate and change and market anticipation is analyzed as of a specific date in time and is only valid as of the specified date.

12. Possession of the report, or a copy thereof, does not carry with it the right of publication, nor may it be reproduced in whole or in part, in any manner, by any person, without the prior written consent of the author particularly as to value conclusions, the identity of the author or the firm with which he or she is connected. Neither all nor any part of the report, or copy thereof shall be disseminated to the general public by the use of advertising, public relations, news, sales, or other media for public communication without the prior written consent and approval of the consultant. Nor shall the consultant, firm, or professional organizations of which the consultant is a member be identified without written consent of the consultant.

13. The author of this report is not required to give testimony or attendance in legal or other proceedings relative to this report or to the Subject unless satisfactory additional arrangements are made prior to the need for such services.

14. The opinions contained in this report are those of the author and no responsibility is accepted by the author for the results of actions taken by others based on information contained herein.

15. Opinions of value contained herein are estimates. There is no guarantee, written or implied, that the Subject will sell or lease for the indicated amounts.

16. The party for whom this report is prepared has reported to the consultant there are no original existing condition or development plans that would subject this property to the regulations of the Securities and Exchange Commission or similar agencies on the state or local level.

17. Acceptance of and/or use of this report constitute acceptance of all assumptions and the above conditions. Estimates presented in this report are not valid for syndication purposes.

Disclaimer

We hereby certify that we have no undisclosed interest in the property and our employment and compensation are not contingent upon our findings. This study is subject to the comments made throughout this report and to all assumptions and limiting conditions set forth herein.

The conclusions presented in this report are based upon the information available and received at the time the report was filed. HCA has taken every possible precaution to evaluate this information for its complete accuracy and reliability. Parts of this report were prepared or arranged by third-party contributors, as indicated throughout the document. While third-party contributions have been reviewed by HCA for reasonableness and consistency for including in this report, third-party information has not been fully audited or sought to be verified by HCA. HCA does not provide financial advice.

It should be understood that economic and marketplace conditions are in constant change. The results presented in this report are the professional opinion of HCA and are based on information available at the time of the report preparation. These opinions infer that market conditions do not change the information received upon which those opinions have been based. HCA assumes no responsibility for changes in the marketplace. HCA assumes no responsibility for information that becomes outdated once this report is written; nor are we responsible for keeping this information current after the date of the final document presentation.

HCA makes no express or implied representation or warranty that the contents of this report are verified, accurate, suitably qualified, reasonable or free from errors, omissions or other defects of any kind or nature. Those who rely on this report do so at their own risk and HCA disclaims all liability, damages or loss with respect to such reliance.

It is presumed that those reading this report understand the contents and recommendations. If this reader is unclear of understanding the contents, clarification can be received directly from a representative of HCA. While the terms of HCA’s engagement do not require that revisions be made to this report to reflect events or conditions which occur subsequent to the date of completion of fieldwork, we are available to discuss the necessity for revisions in view of changes in the economic climate or market factors affecting the proposed multi-family project. Please do not hesitate to call should you have any comments or questions.

Jessica Junker, Owner