| BALANCE SHEET | |
| ASSETS | |
| Real Estate - 32 West 40th Street New York, New York | |
| Land | 1,982,360 |
| Building | 5,339,490 |
| Building improvements | 4,964,736 |
| 12,286,586 | |
| Less: Accumulated depreciation | 5,900,013 |
| Real estate (at net book value) | 6,386,573 |
| Cash and cash equivalents | 607,821 |
| Investment in certificates of deposit | 100,000 |
| Escrow - Northmarq Capital | 101,053 |
| Accounts receivable - tenants | 140,440 |
| Accounts receivable - commercial tenants | 159,658 |
| Other receivables | -0- |
| Prepaid expenses | 116,006 |
| Deferred leasing costs | 17,925 |
| Security deposits held by agent | 78,365 |
| Mortgage refinance costs (net) | 91,949 |
| TOTAL ASSETS | 7,799,790 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |
| LIABILITIES | |
| First mortgage payable | 5,483,443 |
| Leases payable | 114,166 |
| Accounts payable and accrued expenses | 103,971 |
| Accrued mortgage interest | 26,631 |
| Prepaid maintenance | 23,728 |
| Alteration deposits payable | 57,314 |
| Security deposits payable | 79,514 |
| Due to shareholders - real estate tax abatement | 85,194 |
| TOTAL LIABILITIES | 5,973,961 |
| STOCKHOLDERS' EQUITY | 1,825,829 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 7,799,790 |
| STATEMENT OF INCOME AND EXPENSES | |
| REVENUES | |
| Maintenance and special assessments | |
| Maintenance | 1,291,553 |
| Special assessments | 345,749 |
| 1,637,302 | |
| Less: paid-in capital re: mortgage amortization | (166,819) |
| Total maintenance and special assessments used for operations | 1,470,483 |
| Other operating revenues | |
| Commercial and rental income | 556,745 |
| Laundry and storage income | 60,733 |
| Total other operating revenues | 617,478 |
| Other revenues | |
| Transfer fees | 152,760 |
| Sublet fees | 13,855 |
| Interest income | 10,086 |
| Late fees | 22,635 |
| Insurance reimbursement | -0- |
| Move in/out fees | 20,509 |
| Miscellaneous income | 3,704 |
| Total other revenues | 223,549 |
| TOTAL REVENUES | 2,311,510 |
| COST OF OPERATIONS | |
| Administrative expenses - Schedule 1 | 68,859 |
| Operating expenses - Schedule 2 | 606,478 |
| Repairs and maintenance - Schedule 3 | 83,842 |
| Real estate tax (net of $7,279 refund in 2011) | 806,707 |
| Mortgage interest | 317,137 |
| Interest on capital leases | 28,802 |
| Corporation taxes | 9,551 |
| TOTAL COST OF OPERATIONS | 1,921,376 |
| Income (Loss) from operations before depreciation and amortization | 390,134 |
| Depreciation and amortization | 381,878 |
| NET INCOME (LOSS) | 8,256 |