Beaumont City Council
March 18, 2025

Table of Contents
Executive Summary 1
Identification of the Appraisal Problem
Subject Description
Sale History
Pending Transactions
Appraisal Purpose
Value Type Definitions
Property Rights Definitions
Client and Intended User(s)
Intended Use
Applicable Requirements
Report Format
Prior Services
Appraiser Competency
2 2
2 2
3 3
3 4
4 4
4 4
5 Scope of Work 6
Economic Analysis 8
Area Analysis — Riverside County 8
Introduction 8
Population 8
Employment & Economy 9
Household Income 10
Transportation 11
Recreation & Culture 11
Conclusion 12
Surrounding Area Analysis 14
Residential Market Analysis 19
Property Analysis
Land Description and Analysis
Proposed Improvements Description
Real Estate Taxes
Highest and Best Use
27 27
37 45
46 Valuation
Valuation Methodology
Market Valuation — Completed Homes
Land Residual Analysis
Market Value by Ownership
Final Opinion of Value
Exposure Time
Marketing Period
48 48
49 55
68 69
69 69
Certification 71
Assumptions and Limiting Conditions 73
Addenda
A. Appraiser Qualifications
B. Definitions
C. Value by APN
D. Comparable Data
Land Sales
tirr
Altis Beaumont

Executive Summary 1
Executive Summary
Property Name
Address
Property Type
Owner of Record
Tax ID
Altis Beaumont
Discovery Way
Beaumont, Riverside County, California 92223
Residential Subdivision - Single Family
Pardee Homes (TriPointe Homes) and
individual homeowners
See Addenda
Land Area
Land Area (Usable)
Zoning Designation
Highest and Best Use
Exposure Time; Marketing Period
Effective Date of the Appraisal
Date of the Report
Property Interest Appraised
149.39 acres; 6,507,428 SF
149.39 acres; 6,507,428 SF
PA 30, 31, 33, 34, Planning Area (Sundance
Specific Plan) Low, Low -Medium and Medium
Density Residential
Single family residential
12 months; 12 months
January 17, 2025
February 28, 2025
Fee Simple
Value Conclusion
Value Type & Appraisal Premise
No. of Parcels
Value Conclusion
Aggregate Value of Appraised Properties
Aggregate Value of existing Homes based on Assessed Value Total Aggregate Value of Appraised and Assessed Properties in the District 302
402
704
$96,567,000
$180,692,091
$277,259,091
The values reported above are subject to the definitions, assumptions, and limiting conditions set forth in the accompanying report of which this summary is a part. No party other than City of Beaumont may use or rely on the information, opinions, and conclusions contained in the report. It is assumed that the users of the report have read the entire report, including all of the definitions, assumptions, and limiting conditions contained therein.

Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment -specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser's opinions or conclusions.

None
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.

1. The value derived herein is based on the hypothetical condition that certain proceeds to be financed by the CFD No. 2016-3 Revenue Bonds, Series 2025, will be available to reimburse for certain public infrastructure already completed.

The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.

Altis Beaumont

irr

Subject Description 2
Identification of the Appraisal Problem
Subject Description
City of Beaumont CFD No. 2016-3 is comprised of residentially zoned land in the city of Beaumont, and is bounded by Starlight Avenue to the west, N. Highland Springs Avenue to the east, and Cougar Way to the north. Specifically, the territory within CFD No. 2016-3 includes 704 lots being marketed as Altis at Beaumont, a 55+ gated community with a community center ("The VuePoint"), offering several swimming pools, sports courts, billiards lounge, fitness club, as well as studios and outdoor event spaces. There are six product lines within Altis at Beaumont (4 of which have sold out) on lots ranging in size from 3,850 to 5,775 square feet, which feature floor plans ranging in size from 1,419 - 2,559 square feet. Current pricing ranges from $420,000 to $526,000. Of the 704 Assessor's parcels within the boundaries of CFD No. 2016-3, 567 parcels are improved with a completed single-family home, of which 402 have transferred to individual homeowners, or represent model homes, and have a complete assessed value for both land and improvements and are not the subject of this Appraisal.

Property Identification
Property Name
Address
Tax ID
Owner of Record
Altis Beaumont
Discovery Way
Beaumont, California 92223
See Addenda
Pardee Homes (Tri Pointe Homes) and individual homeowners Sale History
The Appraisal Report has been conducted in accordance with appraisal standards and guidelines found in the Uniform Standards of Professional Appraisal Practice (USPAP). The properties comprising the subject of this Appraisal Report have been the subject of previous and recent transactions. Based on the scope of work for this assignment, a detailed sales history was not performed on a parcel -by - parcel basis, as many parcels were, and continue to be, involved in transactions as completed single- family homes from the merchant builder to individual home buyers.

Note the sale history of the completed homes to individuals is not presented, but each sale is believed to be consistent with the market at the time of the respective sale.

Pending Transactions
Based on discussions with the appropriate contacts, the property is not subject to an agreement of sale or an option to buy, nor is it listed for sale, as of the effective appraisal date. However, some individual homes that are under construction are in contract from Tri Pointe Homes to individual homeowners.

Altis Beaumont

irr.

Appraisal Purpose 3
Appraisal Purpose
The purpose of this Appraisal Report is to estimate the market value (fee simple estate), by Assessor's parcel, and the cumulative, or aggregate value of the appraised properties comprising City of Beaumont CFD No. 2016-3 (Altis), subject to the hypothetical condition certain proceeds from the 2025 Special Tax Bonds will be available to reimburse the master developer for various improvements, as of the effective date of the appraisal, January 17, 2025. The date of the report is February 28, 2025.

The appraisal is valid only as of the stated effective date. The home values are based on a "not -less - than" value for (each or smallest floor) plan, without consideration for upgrades and lot premiums.

Further, we have excluded any contributory value of unfinished homes, but consider the value of permits and impact fees paid for lots with either construction underway or not yet begun.

Value Type Definitions
The definitions of the value types applicable to this assignment are summarized below.

Market Value
The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:

1. Buyer and seller are typically motivated;

2. Both parties are well informed or well advised, and acting in what they consider their own best interests;

3. A reasonable time is allowed for exposure in the open market;

4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and

5. The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.' Assessed Value
The value of a property according to the tax rolls in ad valorem taxation; may be higher or lower than market value, or based on an assessment ratio that is a percentage of market value.' Property Rights Definitions
The property rights appraised which are applicable to this assignment are defined as follows.

Code of Federal Regulations, Title 12, Chapter I, Part 34.42[h]; also, Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472 z Appraisal Institute, The Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022) Altis Beaumont

irr.

Client and Intended User(s) 4
Fee Simple Estate
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.' Client and Intended User(s)
The client and intended user is the City of Beaumont. No party or parties beyond the clients and the finance team with this proposed issuance may use or rely on the information, opinions, and conclusions contained in this report; however, this appraisal report may be included in the offering document provided in connection with the issuance and sale of the Bonds.

Intended Use
The intended use of the appraisal is for bond underwriting purposes. The appraisal is not intended for any other use.

Applicable Requirements
This appraisal report conforms to the following requirements and regulations:
• Uniform Standards of Professional Appraisal Practice (USPAP); • Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute; • Applicable state appraisal regulations;
• Interagency Appraisal and Evaluation Guidelines issued December 10, 2010; • Appraisal Standards for Land Secured Financing published by the California Debt and Investment Advisory Commission (CDIAC) (2004).

Report Format
Standards Rule 2-2 (Content of a Real Property Appraisal Report) contained in the Uniform Standards of Professional Appraisal Practice (USPAP) requires each written real property appraisal report to be prepared as either an Appraisal Report or a Restricted Appraisal Report. This report is prepared as an Appraisal Report as defined by USPAP under Standards Rule 2-2(a), and incorporates practical explanation of the data, reasoning, and analysis used to develop the opinion of value.

Prior Services
USPAP requires appraisers to disclose to the client any other services they have provided in connection with the subject property in the prior three years, including valuation, consulting, property management, brokerage, or any other services. We have previously appraised the property that is the subject of this report. We have provided no other services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment.
3 Appraisal Institute, The Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022) Altis Beaumont

irr.

Appraiser Competency 5
Appraiser Competency
No steps were necessary to meet the competency provisions established under USPAP. The assignment participants have appraised several properties similar to the subject in physical, locational, and economic characteristics, and are familiar with market conditions and trends; therefore, appraiser competency provisions are satisfied for this assignment. Appraiser qualifications and state credentials are included in the addenda of this report.

Altis Beaumont

Appraiser Competency 6
Scope of Work
Introduction
The appraisal development and reporting processes require gathering and analyzing information about the assignment elements necessary to properly identify the appraisal problem. The scope of work decision includes the research and analyses necessary to develop credible assignment results, given the intended use of the appraisal. Sufficient information includes disclosure of research and analyses performed and might also include disclosure of research and analyses not performed.

To determine the appropriate scope of work for the assignment, the intended use of the appraisal, the needs of the user, the complexity of the property, and other pertinent factors were considered. The concluded scope of work is described below.

Research and Analysis
The type and extent of the research and analysis conducted are detailed in individual sections of the report. Although effort has been made to confirm the arms -length nature of each sale with a party to the transaction, it is sometimes necessary to rely on secondary verification from sources deemed reliable.

Subject Property Data Sources
The legal and physical features of the subject property, including size of the site, flood plain data, seismic zone designation, property zoning, existing easements and encumbrances, access and exposure, and condition of the improvements (as applicable) were confirmed and analyzed.

Inspection
Details regarding the property inspection conducted as part of this appraisal assignment are summarized as follows:

Property Inspection
Party
Inspection Type Inspection Date
Eric Segal, MAI
Kevin Zi egen meyer, MAI
Kari Tatton
On -site
On -site
None
January 7, 2025
N/A
N/A
Valuation Methodology
Three approaches to value are typically considered when developing a market value opinion for real property. These are the cost approach, the sales comparison approach, and the income capitalization approach. Use of the approaches in this assignment is summarized as follows:

Altis Beaumont

Appraiser Competency 7
Approaches to Value
Approach
Applicability to Subject Use in Assignment
Cost Approach Not Applicable
Sales Comparison Approach Applicable
Income Capitalization Approach Not Applicable
Not Utilized
Utilized
Not Utilized
The valuation began by employing the sales comparison approach to estimate the not -less -than market value for the completed single-family homes, based on the smallest floor plan being marketed within each project with a completed home.

The market value of the residential lots was estimated by utilizing the sales comparison approach and land residual analysis to value of the subject's lots. In valuing the subject lots, we selected a benchmark lot category. In the sales comparison approach, adjustments were applied to the prices of comparable bulk lot transactions, and a market value for the benchmark lot category was concluded.

Finally, we utilized a land residual analysis, which was reconciled with the sales comparison approach conclusion. In the land residual analysis (a variation of the cost approach and income capitalization approaches combined), all direct and indirect costs are deducted from an estimate of the anticipated gross sales price of the improved product; the resultant net sales proceeds are then discounted to present value at an anticipated discount rate over the development and absorption period to indicate the residual value of the lots. After reconciling the two approaches to value, we apply a lot size adjustment factor to account for differing lot sizes from the benchmark lot category.

As a condition of this assignment, the Assessed Values for certain Assessor's Parcels with completed and sold homes with a complete Assessed Value for both Land and Improvements is presented herein for illustration purposes only. As requested, these Assessor's Parcels are not appraised herein with a not -less -than market value; instead, the assigned County of Riverside Assessor's value will be relied upon for underwriting purposes.

This appraisal will utilize the term "improved lot" to denote a residential lot that has all off -sites and on -sites in place, and includes any impact fees due up until building permit. Building permits and fees due at building permit are excluded for finished lot. Terminology for this type of improved lot can vary by market area, and is sometimes referred to as a "loaded lot".

The market value estimates for the various taxable land use components described above were then assigned to the various assessor's parcels comprising the appraised properties in order to derive the cumulative, or aggregate, value of CFD No. 2016-3. Our analysis excluded a typical cost approach since the subject property represents land. However, costs associated with home construction were taken into consideration as part of the land residual analysis and determination of financial feasibility. Given the limited, if any, income producing potential of the land, an income approach was not utilized.

Altis Beaumont

Area Analysis — Riverside County 8
Economic Analysis
Area Analysis — Riverside County
Introduction
Riverside County is part of a region known as the Inland Empire of southern California, southeast of Los Angeles. The county is bordered by San Bernardino County to the north, Orange County to the west, San Diego and Imperial counties to the south, and the state of Arizona to the east. Major cities in the county include Riverside, Moreno Valley, Corona, Murrieta and Temecula. In general, Riverside County is one of California's fastest growing metropolitan areas as new residents locate here from the more expensive metropolitan areas of Los Angeles and San Diego.

Population
The county has a population of 2.44 million and has grown at an average rate of 0.2% per year over the past five years. The following table illustrates recent population trends for Riverside County.

Population Trends
City
Banning
Beaumont
Blythe
Calimesa
Canyon Lake
Cathedral City
Coachella
Corona
Desert Hot Springs
Eastvale
Hemet
Indian Wells
Indio
Jurupa Valley
Lake Elsinore
La Quinta
Menifee
Moreno Valley
Murrieta
Norco
Palm Desert
Palm Springs
Perris
Rancho Mirage
Riverside
San Jacinto
Temecula
Wildomar
Unincorporated
2019 2020 2021 2022 2023 2024 %/Yr(5-year)
31,068 30,595 30,535 30,744 31,046 31,213 0.1%
49,913 53,275 53,920 54,208 56,275 57,416 3.0%
19,530 18,778 17,362 17,418 17,224 17,378 -2.2%
9,015 10,020 10,589 10,930 10,909 10,867 4.1%
11,021 11,060 11,044 10,932 10,846 10,832 -0.3%
53,308 51,319 51,540 51,383 51,045 50,911 -0.9%
47,318 41,866 41,856 41,783 42,179 43,173 -1.8%
166,937 156,670 157,202 156,879 156,268 156,615 -1.2%
30,019 32,389 32,208 32,276 32,380 32,654 1.8%
65,735 69,685 70,401 69,797 69,123 68,884 1.0%
84,354 89,252 89,170 88,856 89,333 89,663 1.3%
5,351 4,755 4,740 4,765 4,733 4,797 -2.1%
90,112 88,722 88,973 89,226 89,978 90,680 0.1%
106,056 104,801 105,120 105,117 104,599 104,721 -0.3%
63,270 70,370 70,951 71,586 71,351 71,452 2.6%
40,663 37,473 37,660 37,523 37,824 38,370 -1.1%
94,710 102,383 104,230 107,120 109,401 111,560 3.6%
207,190 208,069 208,008 207,549 206,903 207,146 0.0%
113,207 110,706 110,916 110,291 109,364 109,177 -0.7%
26,473 26,628 24,640 24,957 24,893 25,068 -1.1%
53,695 50,655 50,590 50,439 50,274 50,889 -1.0%
47,410 44,169 44,235 44,007 43,802 43,791 -1.5%
78,095 78,550 78,724 78,191 78A24 79,311 0.3%
18,397 16,574 16,519 16,787 16,868 16,992 -1.5%
327,076 317,624 313,145 317,821 315,747 316,690 -0.6%
49,655 53,791 54,100 54,108 53,746 53,538 1.6%
112,561 109,731 109,676 109,071 108,173 108,700 -0.7%
36,878 36,691 36,646 36,306 36,093 36,327 -0.3%
380,040 391,584 394,465 397,762 399,779 403,563 1.2%
Total 2,419,057 2,418,185 2,419,165 2,427,832 2,428,580 2,442,378 0.2% Source: California Department of Finance
Altis Beaumont

Area Analysis — Riverside County 9
Riverside is the fourth most populous county in California, following Los Angeles, San Diego and Orange Counties. The majority of residents live within incorporated areas, the largest of which is the City of Riverside, with a population of nearly 317,000.

Employment & Economy
The California Employment Development Department (EDD) has reported the following employment data for Riverside County over the past five years.

Employment Trends
Labor Force
Employment
Annual Employment Change
Unemployment Rate
2018 2019 2020 2021 2022 2023
1,090,100 1,106, 200 1,118,900 1,130,500 1,145,700 1,157,900 1,041,700 1,059,500 1,006,200 1,047,700 1,097,200 1,102, 300 27,500 17,800 -53,300 41,500 49,500 5,100

4.4% 4.2% 10.1% 7.3% 4.2% 4.8%
Source: California Employment Development Department
Riverside County saw declining unemployment rates in 2004-2006, increases from 2007 to 2010, declines between 2011 and 2019, a significant increase in 2020 due to the pandemic followed by improvement in 2021 and 2022. A slowing economy contributed to rising unemployment during 2023.

The California Employment Development Department reported an unemployment rate of 5.4% in Riverside County in November 2024, up from 5.2% a year ago and compared to 5.3% for California and

4.0% for the nation.

As of November 2024, it was reported 27,300 non -farm jobs were gained in the Riverside -San Bernardino -Ontario MSA year -over -year. The greatest growth was in Private Education/Health Services with 20,100 jobs gained, followed by Government with 9,800 jobs gained. The greatest job loss was in Manufacturing and Construction with losses of 3,400 and 3,000 jobs, respectively. The following chart indicates the percentage of total employment for each sector in the metro.

EMPLOYMENT BY SECTOR
Trade/Transport/Utilities
Private Education/Health Services
Government
Leisure & Hospitality
Professional/Business Services
Construction/Mining
Manufacturing
Other Services
Financial Activities
Farm
Information
•
■

0.0% 5.0% 10.0% 15.0% 20.0°x° 25.0% 30.0%
Source: California Employment Development Department
Altis Beaumont

Area Analysis — Riverside County
10 The region's largest employment sector, accounting for roughly 27% of total employment, is Trade/Transportation/Utilities, which includes wholesale and retail trade; followed by Private Education/Health Services (18%) and Government (16%).

The region's largest employers are listed in the following table.

Top Employers - Riverside County
Employer
County of Riverside
Amazon
University of California, Riverside
State of California
Walmart
Moreno Valley Unified School District
Kaiser Permanente Riverside Medical Center
Riverside Unified School District
Mt. San Jacinto College
Stater Bros
Marie Callender Wholesalers, Inc.

Temecula Valley Unified School District
Eisenhower Medical Center
Pechanga Resort & Casino
Hemet Unified School District
Home Depot
Murrieta Valley Unified School District
Starcrest of California
McDonalds
Palm Springs Unified School District
Lake Elsinore Unified School District
Jurupa Unified School District
City of Riverside
Target
Coachella Valley Unified School District
Albertsons
Lowe's Home Improvement
Riverside Community College District
Desert Regional Medical Center
Agua Caliente Band of Cahuilla Indians
Spa Resort & Casino
Beaumont Unified School District
Abbott Vascular, Inc.

Hemet Valley Medical Center
Alvord Unified School District
Riverside County Office of Education
Kroger
Msr Desert Resort LP
Desert Community College District
Medline Professional Hospital Supply
Location
Multiple Locations
Multiple Locations
Riverside
Multiple Locations
Multiple Locations
Moreno Valley
Riverside
Riverside
San Jacinto
Multiple Locations
Corona
Temecula
Rancho Mirage
Temecula
Hemet
Multiple Locations
Murrieta
Perris
Multiple Locations
Palm Springs
Lake Elsinore
Jurupa Valley
Riverside
Multiple Locations
Thermal
Multiple Locations
Multiple Locations
Riverside
Palm Springs
Rancho Mirage
Palm Springs
Beaumont
Temecula
Hemet
Corona
Multiple Locations
Multiple Locations
La Quinta
Palm Desert
Temecula
Description
County Government
E -Commerce
University
State Government
Retail Store
Educational Services
Health Care
Educational Services
Educational Services
Retail Grocery
Food Wholesale
Educational Services
Health Care
Hospitality
Educational Services
Retail Store
Educational Services
E -Commerce
Restaurant
Educational Services
Educational Services
Educational Services
Government
Retail Store
Educational Services
Retail Grocery
Retail Store
Educational Services
Health Care
Tribal Government / Casinos
Hospitality
Educational Services
Medical Device Manufacturing
Hospital
Educational Services
Educational Services
Retail Grocery
Hospitality
Educational Services
Medical Manufacturing
No. of Employees
23,772
14,317
8,593
8,398
6,465
6,020
5,817
5,431
4,638
4,990
4,454
4,022
4,001
4,000
3,960
3,549
3,552
3,450
3,405
3,328
3,267
2,749
2,700
2,609
2,581
2,342
2,276
2,228
2,200
2,200
2,120
2,053
2,011
1,963
1,936
1,712
1,688
1,500
1,200
1,200
Source: Riverside County Economic Development Agency, with source cited as "Data Axle, Econovue, Websites, and Public Records, 2024" Household Income
Median household income represents a broad statistical measure of well-being or standard of living in a community. The median income level divides households into two equal segments with one half of households earning less than the median and the other half earning more. The median income is Altis Beaumont

irr.

Area Analysis — Riverside County 11
considered to be a better indicator than the average household income as it is not dramatically affected by unusually high or low values. According to Claritas Spotlight data reporting service, the median household income estimated for Riverside County in 2025 is $89,604, which is lower than the state of California's median income of $94,758.

Transportation
Access to and through Riverside County is provided by several major routes, including the 10, 15 and 215 Freeways, as well as State Routes 60, 62, 74, 79, 86, 91, 111 and 243. The 10 Freeway is the primary east -west connector while the 15 and 215 Freeways are the primary north -south routes. The 91 Freeway provides travel from the Inland Empire to Los Angeles County and Orange County, via the 55 Freeway.

The 10 Freeway is a major east -west route in Southern California, connecting the Pacific coast (Santa Monica) with the Arizona state line before traveling further east through the southern states and terminating in Jacksonville, Florida. The 10 Freeway links the coast of California, from the City of Santa Monica, Los Angeles and San Bernardino Counties, with Riverside County and the desert cities of the Coachella Valley.

As a primary north -south connector, the 15 Freeway connects the counties of San Bernardino, Riverside and San Diego. The route extends north through Nevada, Arizona, Utah, Idaho and Montana to the Canadian border. The 15 Freeway is a major thoroughfare for traffic between San Diego and the Inland Empire, as well as between Southern California and Las Vegas, Nevada. The 215 Freeway comprises approximately 55 miles of interstate highway in the Inland Empire, generally traveling parallel with the 15 Freeway. The southern terminus of the 215 is at the junction of the 15 Freeway in Murrieta in south Riverside County and travels through Perris before briefly merging with the 60 Freeway in Moreno Valley and continuing north from the 60 Freeway interchange to San Bernardino County and reconnecting with the 15 Freeway at Cajon. This interstate provides an alternative to the 15 Freeway for travel within Riverside and San Bernardino Counties.

Public transportation is provided by various agencies. Riverside Transit Agency serves the western third of Riverside County, SunLine Transit Agency serves Palm Springs and the Coachella Valley area, Palo Verde Valley Transit Agency serves Blythe near the Arizona border, Pass Transit serves the San Gorgonio Pass communities, and Corona Cruiser serves the community of Corona. In addition, Riverside County is also served by Greyhound buses and Amtrak passenger trains.

The county's main airport is the Palm Springs International Airport. This two -runway airport is located about two miles east of downtown Palm Springs and is highly seasonal, with most flights operating during the winter.

Recreation & Culture
Riverside County offers innumerable recreational and cultural opportunities, including many public parks, schools, golf courses, museums and performing arts venues. Popular attractions include the Botanical Gardens at the University of California, Riverside; the historic Mission Inn in downtown Riverside; March Field Air Museum, an aviation museum near Moreno Valley and Riverside, adjacent to the March Air Reserve Base; Temecula Valley, a tourist destination in the southern part of the Altis Beaumont

Area Analysis — Riverside County 12
county with numerous wineries, wine tasting rooms, bed and breakfast inns and wedding venues; and Castle Park, an amusement park. Annual events in the county include the Festival of Lights in Riverside, known for its display of nearly three million Christmas lights; Ghost Walk Riverside; Temecula Valley Balloon and Wine Festival; and Harvest Wine Celebration.

Riverside County is home to multiple higher education institutions including, but not limited to, the University of California Riverside, California Baptist University, California Southern Law School, California State University San Bernardino and Mt. San Jacinto College.

Conclusion
In general, Riverside County is one of the fastest growing areas in the state. New residents have been relocating here from the more expensive metropolitan areas of Los Angeles and San Diego. The region offers diverse employment opportunities, numerous colleges and universities, extensive transportation routes, shopping centers, public services and recreational activities.

Employment conditions declined sharply in 2020 after the onset of the pandemic and though market and economic conditions have since improved, ongoing macroeconomic factors, specifically high inflation and interest rates, have reintroduced uncertainty in the market. Recovery in the market is expected to be gradual and the long-term outlook for the region is good.

Altis Beaumont

irr.

Area Analysis — Riverside County
13 Area Map
,•
•
Sun village
Victorville
CCU
r()-NiIIr Corona
ch. Santa Ana
` L,
Huntington Beach Menifee
• Murrieta
Rancho
Cucamonga Fontana
• • • •San Bernardino
• Rialto--
Ontario —
• Riverside,v
Fullerton Banning
• / Moreno
Valley
Laguna Niguel
Microsoft
,• Bing
•
Hemet
Temecula
kd
Amboy
Twentynine Palms
Marine Corps Base
Johnson
Valley
Homestead Valley
Yucca Valley
Joshua Tree National
Cathedral City Park
Indio
North Shore
Desert Shores
2025 LIcm,55 mama rslian 22024 TamTam
Altis Beaumont

irr

Surrounding Area Analysis 14
Surrounding Area Analysis
This section of the Appraisal Report provides an analysis of the observable data that indicate patterns of growth, structure and/or change that may enhance or detract from property values. For the purpose of this analysis, a neighborhood is defined as "a group of complementary land uses; a congruous grouping of inhabitants, buildings, or business enterprises." Boundaries
The boundaries of a neighborhood identify the physical area that influences the value of the subject property. These boundaries may coincide with observable changes in prevailing land use or occupant characteristics. Physical features such as the type of development, street patterns, terrain, vegetation and parcel size tend to identify neighborhoods. Roadways, waterways and changing elevations can also create neighborhood boundaries.

The subject property is located within the city of Beaumont, which is located in Riverside County, within the Inland Empire region of Southern California. It is bordered on the north by the unincorporated community of Cherry Valley, on the east by the City of Banning, on the south by the City of San Jacinto and on the west by the City of Calimesa. It has a land area of 30.9 square miles and an elevation of 2,500-3,000 feet above sea level. It is situated at the peak of the San Gorgonio Pass between the cities of San Bernardino and Palm Springs.

Access and Linkages
Since the San Gorgonio Pass was discovered in 1853, it has been at the center of transportation in the region, beginning with early trails, then railroads, highways and interstates. Today, Beaumont is still a transportation hub with major routes extending in every direction. Three major interstates/highways intersect at what is known as the Beaumont Avenue interchange: Interstate 10, State Route 60 and State Route 79.

Interstate 10 is the primary transportation corridor through the city, with access to Santa Monica and the Pacific Ocean to the west and eastward to the low desert cities of Palm Springs and Indio, to the Southwest regions in Arizona and New Mexico, terminating in Jacksonville Florida on the east coast.

The 60 Freeway is a major east/west transportation route linking Interstate 5 in downtown Los Angeles with Interstate 10 in Beaumont. The 60 Freeway provides direct access to most of the north/south freeways in the greater Los Angeles area, including the 215, 15, 91, 57, 605, 710 and 5 freeways. State Route 79 provides access to Hemet, Winchester and Temecula to the south. To the north, State Route 79 is Beaumont Avenue and provides access to the neighboring community of Cherry Glen and on to the scenic apple country of Oak Glen.

Public transit is available through the City of Beaumont Transit System, which also operates the Pass Transit System in collaboration with the City of Banning Transit. The system offers eight fixed routes and a commuter link to Calimesa, the San Bernardino Metrolink and the Loma Linda Veteran's Hospital. Additional services include Dial -A -Ride and curb -to -curb service for ADA certified and seniors 65 years and older within Beaumont and parts of Cherry Valley.

Altis Beaumont

Surrounding Area Analysis 15
In terms of air travel, there are several proximate airports available to residents of Beaumont. Palm Springs International Airport is the nearest major airport, located approximately 30 miles to the east and the LA/Ontario International Airport is located approximately 40 miles west in Ontario. Six additional airports offering commercial international and/or domestic flights are located within 100 miles. Local airports include the Banning Municipal Airport located less than 10 miles to the east; the Redlands Municipal Airport approximately 18 miles northwest; the Hemet -Ryan Airport 18 miles to the south; and several others in San Bernardino, Riverside and Colton, all within approximately 30 miles of Beaumont.

Demographics
A demographic profile of the surrounding area, including population, households, and income data, is presented in the following table.

Surrounding Area Demographics
2024 Estimates
Population 2020
Population 2024
Population 2029
Compound % Change 2020-2024
Compound % Change 2024-2029
Households 2020
Households 2024
Households 2029
Compound % Change 2020-2024
Compound % Change 2024-2029
92223 Riverside County,
1 -Mile Radius 3 -Mile Radius 5 -Mile Radius (Beaumont, CA) CA 10,460 54,385 83,303 59,025 2,418,185
11,549 58,456 88,395 63,336 2,50Q920
12,919 63,765 95,213 69,006 2,623,551

2.5% 1.8% 1.5% 1.8% 0.8%

2.3% 1.8% 1.5% 1.7% 1.0%
3,460 19,194 29,520 19,424 763,283
3,790 2Q673 31,281 20,777 791,632
4,215 22,543 33,636 22,558 832,792

2.3% 1.9% 1.5% 1.7% 0.9%

2.1% 1.7% 1.5% 1.7% 1.0%
Median Household Income 2024 $93,999 $82,088 $79,163 $97,961 $84,882 Average Household Size 3.1 2.8 2.8 3.0 3.1
College Graduate % 22% 23% 22% 25% 24%
Median Age 38 41 42 39 38
Owner Occupied % 82% 75% 75% 78% 67%
Renter Occupied % 18% 25% 25% 22% 33%
Median Owner Occupied Housing Value $464,853 $429,228 $431,852 $465,288 $548,183 Median Year Structure Built 2005 2000 1998 2003 1989
Average Travel Time to Work in Minutes 38 36 35 36 35
Source: Claritas
As shown above, the current population within a 3 -mile radius of the subject is 58,456, and the average household size is 2.8. Population in the area has grown since the 2020 census, and this trend is projected to continue over the next five years. Compared to the subject's 92223 zip code overall, the population within a 3 -mile radius is projected to grow at a similar rate.

Median household income is $82,088, which is lower than the household income for the 92223 zip code. Residents within a 3 -mile radius have a lower level of educational attainment than those of the 92223 zip code, while median owner -occupied home values are also lower.

Altis Beaumont

Surrounding Area Analysis 16
Recreation & Community Facilities
The City of Beaumont offers adequate recreational opportunities and community facilities, with additional services accessible within 20-30 miles (30 -40 -minute driving time) in the larger cities of San Bernardino, Riverside and Moreno Valley. Beaumont hosts a number of family -oriented events throughout the year. The largest event is the Cherry Festival, which celebrated its 100th anniversary in May/June 2018. It is a four -day community festival with food and drinks, games, music, entertainment, rides and booths.

Beaumont offers two championship golf courses: Oak Valley Golf Club and Morongo Golf Club at Tukwet Canyon, which was formerly owned and operated by the PGA. Antique shops along 6th Street have long been a well-known attraction in Beaumont, providing a unique shopping experience. The nearby Cabazon Outlet Mall provides additional shopping, featuring 65,000 square feet of shops, representing 18 specialty retailers. Adjacent to this project, is the Desert Hills Premium Outlet Center, an upscale outdoor shopping center which includes over 900,000 square feet and features 180 retailers; this center represents the largest premium outlet center in California.

The nearest hospital is the San Gorgonio Memorial Hospital located just outside the Beaumont city limits, in Banning. The Beaver Medical Group, with offices throughout the Inland Empire, offers primary care, urgent care and laboratory services at its Beaumont location.

The city is served by seven elementary schools, two middle schools, two high schools and an adult school. Secondary education is accessible within approximately five to 20 miles in nearby communities, including Mt. Jacinto Community College with the San Gorgonio Pass Campus located in Banning and the main campus located in San Jacinto; Crafton Hills College in Yucaipa; Moreno Valley College in Moreno Valley; and University of Redlands in Redlands.

The Beaumont Civic Center houses two memorials. The Veteran's Memorial honors local veterans who served from World War I through present-day operations. The Public Safety Memorial honors police officers and firefighters who died in the line of duty or served in the community during their lifetime.

In addition, the Centennial Memorial Bridge, located off Oak Valley Parkway, honors individuals who made significant contributions to the community within its first 100 years.

Land Uses
Land uses in the immediate area include primarily residential, with supporting commercial services located proximate to Interstate 10.

A neighborhood retail center anchored by Stater Bros. Market is located at the northeast corner of Oak valley Parkway and Beaumont Avenue. A Food 4 Less anchored retail center is located at the southeast corner of North Highland Springs Avenue and East 6th Street. Just south of Interstate 10 at North Highland Springs Avenue is a high concentration of retail development, including Best Buy, Ross Dress for Less, Bed Bath & Beyond, The Home Depot and Wal-Mart, among other retailers. Just east of Best Buy, in the city of Banning, is Sun Lakes Village Shopping Center, which is anchored by Hobby Lobby, Rite Aid and Albertsons.

Altis Beaumont

Surrounding Area Analysis 17
Outlook and Conclusions
In conclusion, the subject's immediate neighborhood is growing in residential uses. The area is considered to be a middle -income neighborhood with adequate support facilities in proximity. The overall condition and quality of the neighborhood is rated as average. The subject property is considered to have average transportation characteristics, including proximity to major neighborhood thoroughfares and freeway access. Overall, the subject is expected to perform reasonably well over the long term.

Altis Beaumont

irr.

Surrounding Area Analysis 18
Surrounding Area Map
UL`1
0 r
U
Beaumont
High
School J O
}
a,
rf
Oak Valley Pkwy
n
2224'o,niam€22251.1crosafl Ga rporaton ,€'0aenStreetMn5 https:.!wmv.openstreetmap.ovicopyrght Altis Beaumont

irr.

Residential Market Analysis 19
Residential Market Analysis
Given prevailing land use patterns and the subject's zoning, a likely use of the property is for residential development. In the following paragraphs, we examine supply and demand indicators for residential development in the subject's area.

Submarket Overview
The subject is located in the city of Beaumont. The subject is adjacent to newer home construction and planned future development and is considered to have good transportation linkages. The neighborhood is characterized as a suburban area that appeals to both local workers and commuters.

Based on existing surrounding homes and new projects under development, the subject characteristics best support a project designed for a combination of move -up home buyers and buyers looking to downsize.

Single -Family Building Permits
Single-family building permits for the city of Beaumont as well as Riverside County totals are shown in the following table. When we compare the trend in permitting, population and price, there can be a relationship. More supply of homes could eventually mean lower prices, whereas conversely a lower number of permits pulled could eventually mean higher prices. Further, the number of permits pulled shows builder confidence in the current market when compared to other years.

Single -Family Building Permits
Year City of Beaumont %Change County of Riverside %Change 2014 454
2015 466
2016 450
2017 741
2018 684
2019 535
2020 271
2021 442
2022 790
2023 91
5,058

2.64% 4,325
- 3.43% 5,136

64.67% 5,827
- 7.69% 7,327
- 21.78% 6,267
- 49.35% 8,344

63.10% 7,428

78.73% 8,211
- 88.48% 8,349
-14.49%

18.75%

13.45%

25.74%
-14.47%

33.14%
-10.98%

10.54%

1.68%
Source: SOCDS Building Permits Monthly Request
Altis Beaumont

Residential Market Analysis 20
Single -Family Building Permits: 2024 Preliminary Data
Month City of Beaumont County of Riverside
January 33
February 41
March 5
April 0
May 13
June 20
July 10
August 50
September 29
October 18
November 0
Total 219
663
667
636
673
762
598
769
645
544
517
466
6,940
Source: SOCDS Building Permits Monthly Request
Active New Home Projects Pricing and Absorption
The city of Beaumont is located within the North Central Riverside submarket of the Inland Empire.

The Ryness Report provides a comparison of sales activity between various regions and markets, including year-to-date totals from the same week of the previous year. Their surveys and reports include sales, buyer traffic, and financing rates on activity in major residential developments throughout California, Arizona, and Nevada. The report for the Inland Empire for the week ending January 12, 2025, is included as follows.

Altis Beaumont

irr.

Residential Market Analysis 21

THE RYNESS REPORT
A New Horne Sales, Marketing & Research Company
Inland Empire
Week 2
Sponsored by
tEObank
Ending: Sunday, January 12, 2025
I es 1 Groups
ProJeete
Traffic
5alea
Canoga
Net
Sales
Avg.

Salsa
Year Co Dabs
Avg. Dtn.

Pray. 13 Ma.

Avg. Dlr.
central -North Central Riverside
52 568
58 7
51 0:98

0.73 35%

0.64 65%
Desert Riverside
16 205
15 13

0.81 0.66
24%

4.43 91%
Murrieta - Temecula
6 160
6 1
5 0.83

1.00 -17%

1.04 -17%
Northwest Riverside
30 411
26 5
23 0.77
D.68
12%

0.49 57%
South Riverside
45 515
38 12
26 0.58

0.58 -1%

0.72 -20%
Central -East San Bernardino
26 189
14 4
14 0.38

0.44 -13%

4.59 -35%
Desert San Bernardino
12 107
3 3
4 0-04

0.17 -100%
0 41
-100%
NW -SW San Bernardino
26 1623
15 2
13 D.50

0.58 -13%

0.68 -27%
Current Week Totals
-mono
Sal..
22:1
213
3876
ITT
36 141

0.66 0.61
B%
0-61
9%
Per Project Average
' E.

D. E.3
G '-
C nn
Year Ago - 01,1412024
Tmrn.

Sala
1t:1
248
4688
278
21 257

1.00 0.64
23%

0.60 7241.
% Change
-14.s
-1,11
-35V

1.1.6 .lsa
-35% -2P1s.
11 1.6
14 12-
06 04
02 52 Weeks Comparison
7 `I A,A0
..

I
1 r-
r."
i.

I
01 Q2
uibank
03 Year to Date Averages Through Week 2
Annual
Graph
Legend
Yam
Gig.

Nraekyy
ProJacle
Avg.

Weakly
"franc
Avg.

Weekly
Sales
Avg-
weaxly
Cascele
evg.
.Project
Sales
Year End
.Avg.ProJ.

Sales
2020
240
31 O.7a

0.1D

47.48 101
•
2021
213
2a

1.23 0.1D

1.12 1.0.5
•
2022
1de
28 1.34

0.11 1.23
074
•
2023
23d
19 0.73

0.15 6.59
0 5Z
•
2024
2243
12 0.93

0.05 0.84
0 P3
•
2025
214
18 0.7P

0.14 3.81
051
ffi C r :hose
-I-ic
-: 3'i
-.2n%
Wa3
-.31
-2£4.

Aeeragee urged l r ;a- a a:I:bn. Charge 4. rab.aled 7n aca.al rambers.

WEEKLY FINANCIAL NEWS
Financing
Market Commentary

RATE APR
CONV

6.63°6 6.91%
Residential construction remains lackluster. On a year-to-date bass, single-family FHA

6.38% 7.271°
housing starts were up 7.2% in November, while muttifamity starts were down 27%.

Heavy supply of new apartments has underpinned the downturn in multifamily construction. Filings for apartment building pen -nits have fallen off as well, signaling weak activity in the coming months- Conditions are brighter in the single-family market_ 10 Yr Yield

4.78°%
The National Association of Home Builders' gauge for future sales rose three points to 66 in December. which is the highest since 2022. While mortgage rates continue to trend up, single-family home builders have used price cuts and other incentives to alleviate affordability challenges_ We look for total housing starts to increase 2.4% in December to a 1.320K -unit annual pace. -Source: Wells Fargo Ban Weekly Economic in and
Financial Commentary'
LENDER
Altis Beaumont
Copyright 2025 The Ryness Company I; A New Horne Sales. Marketing & Research Company B11 San Ramon Valley Boulevard, Danville, California 04526 1025) 820-3432

Residential Market Analysis
22 The absorption within the Inland Empire has increased 1% from a year ago. The number of projects within Inland Empire varies year by year due to the extended entitlement and development timelines.

The Ryness Report has identified 25 active projects in the North Central Riverside submarket, with 11 of those within the city of Beaumont. These projects are summarized as follows:

Developement Marne Developer City Code
Notes Type
Central -North Central Riverside I North Central Riverside Projects Participating: 25
Units
N.

Rao
Rerd
�,p
Trap
Wks
Sales
Wks
Cans
Said
to
Date
Sold
VTD
Av.

Sls
Mleee
Ar.

SK
MD
Ire Park Beazer MV
DTMU
81 0
8 T 0 0 43
0 0.75 0.00
Canlerv.;ry II Crestwood EA
DTMU
58 0
2 27 1 0 11
1 0.32 0.50
Augusta at The Fairways OR HoHon BE
DTMU
400
0 2
13 1 0 371
2 1.93 1.00
Bella Sera DR Horton MV
DTMU
110
3 3
17 1 0 31
2 1.09 1.00
Skylar Pointe CR Horton MV
DTMU
84 D
2 8 0 0 70
2 124 1.00
Stella Pane DR Honor MV
DTMU
159
5 3
24 4 0 47
4 1.65 2.00
Wndsong DR Horton MV
DTMU
-03
3 3
17 3 0 71
5 120 250
Bnsa at Nuevo bleacows KB Hare NU
DTMU
154
0 12
11 D 0 142
1 120 D-50
C elo at Nueva Meaoorrs KE Hone NU
DTMU
153
0 5
11 0 0 112
1 1.00 0.50
Palmetto KB Hone MV
DTMU
104
D
25 15 1 1 31
0 0.77 0.00
Vista Roles KB Home BA
DTMU
143
5 15
BO 4 0 4
4 2.80 2.00
Fairways Azalea Heritage BE
Fairrays Holly Meriage Tr, O BE
DTMU
DTMU
I11
05 D
0 2
TSO
4 1 0 75
4 0 D 52
2 0

0.84 1.00

0.55 0.00
Fairways M nagdia Heritage BE
DTMU
11i
0 2
4 0 0 78
1 0.83 0.50
Seasons at The Fairways Rchmond Amencan FE
DTMU
62 0
1 5 0 0 59
1 047 0.50
Olivewrood Classic Taylor Morrison BE
DTMU
236
0 2
12 1 0 227
1 1.04 0.50
Olivevnod Premier Tayla� Momson BE
DTMU
275
0 1
12 1 0 267
I

1.22 0.50
Olivewood S g+aPne Taylo•Mormon BE
DTMU
171
0 2
12 0 D 104
0 O.BI 0.00
C era at Atwe.1 TRI Poi to BA
DTMU
165
0 B
11 1 t 19
0 0.72 0.00
C -ow.• at Tournament Htls TRI Ponte BE
DTMU
144
0 3
4 1 0 141
1 0.96 0.50
Lma at yves TRI Pointe BE
AASF
103
0 7
3 1 0 60
1 5146 0.50
Linwood at Atwell TRI Pointe BA
DTMU
1T3
D
5 11 0 t 100
0 1.21 0.00
Rosa at Ales TRI Pointe BE
AASF
174
D
7 4 D 0 100
D
075 0-00
Rosetta at Atwe!l TRI Pointe BA
DTMU
282
2 10
12 0 0 119
1 132 aso
Southc-eek at Atwell TF! Po -Me BA
DTMU
295
0 7
12 3 0 220
4 2.13 2.00
TOTALS: No. Repeating: 25 Avg. Sa1ez: 0.84
Traffic to Sales: 13 :
1 138
321
24 3
2[35
35 Net 21
C ry Codes. MV = Moreno Val ey. BA = Banning. BE = Beaumont NU = N aevo Project Types:

MAT =Active Aduh ATT , AASF = Active Adu It SFD . KRAL.' = Attached More -up . ATST = Attached Slaver . ATT = S. ngie Family Attached .

COHT = Condo7Hotel . CONV = Conversion . DTMU = Detached Move -up . DTST = Detached Starter . HIGH = High Rise . LOFT = Loft .

MIDR = Mid -Rise , RW HS = Row Houses , SFD = Single Family Detached Abbreviations: SO = Sold Out, TSO = Temporarily Sold Ort Projects considered most similar to the subject are further detailed in the following table.

Altis Beaumont

Residential Market Analysis 23
Active Projects
Project Name
Augusta at The Fairways
Fairways Azalea
Fairways Holly
Fairways Magnolia
Seasons at The Fairways
Olivewood
Crown at Tournament Hills
Lina atAltis
Rosa atAltis
Avg. Home Average Units Avg. Avg.

Community Developer Average Price Size (SF) Price/SF Planned Units Sold Sales/Week Sales/Month Beaumont DR Horton $541,750 1,990 $272.30 400 371 1.93 7.72 Beaumont Meritage $611,695 2,541 $240.73 111 75 0.84 3.36 Beaumont Meritage $624,000 2,887 $216.14 65 52 0.55 2.20 Beaumont Meritage $592,298 2,665 $222.29 111 78 0.83 3.32 Beaumont Richmond American $689,232 2,525 $272.96 62 59 0.47 1.88 Beaumont Taylor Morrison $632,449 2,494 $253.59 682 658 1.03 4.13 Beaumont TriPointe $578,819 1,795 $322.46 144 141 0.96 3.84 Beaumont TriPointe $504,667 2,036 $247.87 103 66 0.46 1.84 Beaumont TriPointe $448,333 1,582 $283.40 174 108 0.75 3.00 Minimum $448,333 1,582 $216.14
Maximum $689,232 2,887 $322.46
Average $580,360 2,279 $259.08

1.84 7.72

3.48 Source: Ryness Reports and Developer's Websites.

The absorption within projects most similar to the subject ranged from 1.84 to 7.72 sales per month with an average of 3.48 sales per month. Though, it's worth noting, while the subject property (Lina at Altis and Rosa at Altis) is the only active adult community within the survey above, the absorption rates are generally consistent with the balance of the market. According to the Builder, absorption has been slow in recent quarters. This may likely be due to a growing number of competing (active adult) communities targeting buyers throughout competing markets in the Inland Empire.

Resale Pricing
The following table shows historical resale data for more recently built homes (2015 and newer) in the city of Beaumont. We restricted our search to lot sizes with less than 12,000 square feet. The resale market is analyzed as a further gauge of buyer demand for housing. Often home buyers are considering housing purchase options that cover both the new home market, as well as the resale market.

Altis Beaumont

Residential Market Analysis 24
Resales
Living Area Last List Sales Days on Lot Size
Address Sale Date (SF) Sale Price Price Price/SF Sale/List Year Built Market (SF) 1566 Park Haven DR 1/15/2025 2,186 $600,000 $620,000 $274 96.77% 2023 22 6,425 1638 Dodson LN 1/6/2025 2,116 $545,000 $539,999 $258 100.93% 2017 5 8,276 1484 E 8th ST 12/30/2024 1,868 $530,000 $520,000 $284 101.92% 2019 6 9,583 1663 Ocala LN 12/22/2024 2,243 $540,000 $520,000 $241 103.85% 2020 9 7,039 35481 Alexandria Way 12/21/2024 2,720 $667,000 $679,000 $245 98.23% 2022 23 4,948 1360AlpineAve 12/20/2024 1,764 $540,000 $525,000 $306 102.86% 2016 51 5,663 14145 Bosana Ln 12/20/2024 2,401 $570,000 $585,000 $237 97.44% 2019 106 9,583 1559 Turningcrest Ln 12/16/2024 1,419 $435,000 $438,500 $307 99.20% 2023 53 4,491 1676 Milford Way 12/16/2024 1,764 $490,000 $490,000 $278 100.00% 2016 8 5,663 1556 Triton Ln 12/13/2024 1,757 $570,000 $559,000 $324 101.97% 2018 20 10,454 1631 Ocala Ln 12/13/2024 2,438 $578,000 $609,900 $237 94.77% 2016 29 7,841 35345 Smith Ave 12/13/2024 3,669 $630,000 $639,888 $172 98.45% 2016 170 10,019 1542 Big Horn 12/11/2024 2,038 $517,000 $517,500 $254 99.90% 2015 130 6,098 1446 Galaxy Dr 12/10/2024 1,971 $530,000 $519,999 $269 101.92% 2018 34 5,663 11357 Lexi Ln 12/7/2024 1,557 $511,000 $500,000 $328 102.20% 2017 15 4,792 1761 Arcus Ct 12/6/2024 1,757 $555,000 $559,000 $316 99.28% 2020 79 6,913 1671 Milford Way 12/3/2024 1,948 $515,000 $525,000 $264 98.10% 2016 40 5,227 14109 Bosana Ln 12/2/2024 3,013 $655,000 $655,000 $217 100.00% 2018 112 9,583 1551 Williamson 11/30/2024 1,738 $495,000 $525,000 $285 94.29% 2017 78 4,356 1364 Groveland St 11/29/2024 1,757 $533,750 $525,000 $304 101.67% 2019 7 9,514 1309 Moonstone Ave 11/26/2024 1,757 $524,900 $529,900 $299 99.06% 2017 68 5,227 36787 Cordoba Trail 11/26/2024 2,261 $563,000 $569,000 $249 98.95% 2021 62 6,534 14216 Tuscany PI 11/25/2024 2,040 $575,000 $590,000 $282 97.46% 2018 50 9,148 1682 Park Village Dr 11/24/2024 1,534 $434,900 $434,900 $284 100.00% 2022 103 6,473 477 Harvard Peak 11/20/2024 1,561 $462,500 $464,900 $296 99.48% 2016 14 6,534 1570 Park Haven 11/19/2024 1,934 $475,000 $489,900 $246 96.96% 2023 62 6,425 451 Princeton Peak 11/15/2024 1,706 $445,000 $464,900 $261 95.72% 2016 156 7,841 1380 Pumice Ln 11/15/2024 1,544 $535,000 $519,000 $347 103.08% 2018 4 8,712 1635 Ocala Ln 11/15/2024 2,116 $525,000 $539,000 $248 97.40% 2016 56 7,841 Total Sales 29 2,020 $536,105 $552,639 $273 99.69% 2018 50 7,107 (avg.) (avg.) (avg.) (avg.) (avg.) (avg.) (avg.) (avg.) Source: Local Multiple Listing Service (MLS)
Ability to Pay
The subject property contains six different product lines, four of which have sold out. The Developer is currently constructing six floor plans (within two product lines) ranging in size from 1,419 to 2,186 square feet. In this section, we will examine the ability to pay among prospective buyers for a representative price point of $475,000 . First, we will estimate the required annual household income based on typical mortgage parameters in the subject's market area. Specifically, we will employ a loan -to -value ratio of 80% (down payment of 20%), mortgage interest rate of 7.00%, 360 monthly payments, and a 40% ratio for the housing costs as a percent of monthly income (inclusive of principal, interest, all taxes and insurance). Property tax payments are accounted for in the analysis as well as homeowner's insurance and homeowner's association. The following table shows the estimate of the annual household income that would be required to afford homes priced at the representative price point.

Altis Beaumont

irr.

Residential Market Analysis 25
Income Required
Home Price $475,000
Loan % of Price (Loan to Value) 80%
Loan Amount $380,000
Interest Rate 7.00%
Mortgage Payment $2,528
Property Taxes $575 Based on 1.297010% and direct charges of $735 CFD No. 2016-3 $131
Homeowner's Association Fee $305
Property Insurance $99
Total Monthly Obligation $3,638
Mortgage Payment % of I ncome 40%
Monthly Income $9,095
Annual Income $109,137
We have obtained income data from Claritas Spotlight by Environics Analytics, for a 10 -mile radius surrounding the subject property, which is considered representative of typical buyers for the subject property. In the following table we show the income brackets within the noted area, along with estimates of the percentage of households able to afford homes priced at the representative price point within each income bracket.

Household Ability
Percent of Percent Able to Households
Household Income Households Households Pay Households Able to Pay <$15,000 8,412 5.9% 0.0% 0 0.0%
$15,000 - $24,999 6,325 4.5% 0.0% 0 0.0%
$25,000 - $34,999 6,310 4.5% 0.0% 0 0.0%
$35,000 - $49,999 10,762 7.6% 0.0% 0 0.0%
$50,000 - $74,999 19,542 13.8% 0.0% 0 0.0%
$75,000 - $99,999 17,751 12.5% 0.0% 0 0.0%
$100,000 - $124,999 15,755 11.1% 63.5% 9,997 7.1%
$125,000 - $149,999 12,946 9.1% 100.0% 12,946 9.1%
$150,000 - $199,999 17,084 12.1% 100.0% 17,084 12.1%
$200,000 - $249,999 9,994 7.1% 100.0% 9,994 7.1%
$250,000 - $499,999 10,668 7.5% 100.0% 10,668 7.5%
$500,000+ 6,109 4.3% 100.0% 6,109 4.3%
141,658 100.0% 66,798 47.2%
Generally, interest rates have an inverse relationship on the affordability of a home. In short, all else being equal, higher interest rates lower the price point for buyers based on income. Over the past several years, interest rates have remained historically low, often at or below 3.0%. Current mortgage interest rates more closely resemble historic rates and for the most part the home buyer pool appears to recognize that the 3% mortgage rate environment was the anomaly and rates around the 6-7% level are most likely into the foreseeable future.

Conversations with sales agents in multiple new home projects noted there was a slowing in demand for new residential homes in the second half of 2022 and early 2023. The combination of historically LT
Altis Beaumont

Residential Market Analysis 26
high new home prices and rising interest rates priced some buyers out of entry-level (lower -priced) homes. Most homebuilders noted pace of sales slowed from the historic highs, which prompted many homebuilders to begin offering concessions in the form of buying down interest rates and discounted options, instead of decreasing their base prices. In some markets, there was enough downward pressure on the market for homebuilders to offer concessions as well as drop their base prices.

Prior to mid -2022, homebuilders were able to sell homes faster than they were able to construct them, but with the rising interest rates this has since moderated pace of sales to a level more in line with builders' ability to deliver. The recent increases in interest rates impacted the pace of sales as well as pricing in most markets. However, there are signs the residential market is beginning to stabilize. Since Spring 2023, markets have generally been stronger than expected. Homebuyers that previously were waiting on the sidelines either in anticipation of decreasing home prices, or due to interest rate volatility, are beginning to adjust their budgets to the new higher interest rates as home pricing stabilizes. In addition, low inventory and a tight resale market make new construction more attractive. According to market participants in the spring, absorption rates have remained steady or increased slightly with some homebuilders having small increases in base prices since the First Quarter 2023
Conclusions
Demand for homes in the subject's market area remains active as indicated by the overall trend of building permit activity, new home sales prices and activity in recent quarters as well as the absorption rate within new home projects in the subject's area.

Altis Beaumont

Land Description and Analysis 27
Property Analysis
Land Description and Analysis
Land Description
Land Area
Source of Land Area
Primary Street Frontage
Shape
Corner
Topography
Drainage
Environmental Hazards
Ground Stability
149.39 acres; 6,507,428 SF
Public Records
Discovery
Irregular
Yes
Generally level and at street grade
No problems reported or observed
None reported or observed
No problems reported or observed
Flood Area Panel Number
Date
Zone
Description
Insurance Required?
06065C0805G
August 28, 2008
X
Outside of 500 -year floodplain
No
Zoning; Other Regulations
Zoning Jurisdiction
Zoning Designation
Description
Legally Conforming?
Zoning Change Likely?
Permitted Uses
Minimum Lot Area
Maximum Building Height
Density
Parking Requirement
Other Land Use Regulations
City of Beaumont
PA 30, 31, 33, 34
Planning Area (Sundance Specific Plan) Low, Low -Medium and Medium Density Residential
Appears to be legally conforming
No
Detached single-family units with a variety of densities 3,000 - 7,000
35'

4.2 - 7.5 du/acre
2 enclosed
None reported or observed
Utilities
Service
Provider
Water
Sewer
Electricity
Natural Gas
Local Phone
Beaumont -Cherry Val ley Water District
City of Beaumont
Southern California Edison
SoCa I Gas Company
Various proivders
Altis Beaumont

irr.

Land Description and Analysis 28
Zoning
The subject is comprised of four planning areas allowable densities, show as follows:
c)
PA 34
LOW DENSITY -6,000
PA 31

MEDIUM DENSITY
PA 30

LOW-MED DENSITY
PA 28

OPEN SPACE
(EDISON EASEMENT)
_COUGAR WAY
PA 33
LOW DENSITY - 7,000
Very Low Density Residential
Low Density Residential
Low -Medium Density Residential
Medium Density Residential
High Density Residential
Park }Cm.; Additional ParkArea
Open Space with Trails
Open Space, other*
Institutional
Commercial
*Includes enhanced landscape
entries, landscaped detention
basins and well site.

We are not experts in the interpretation of zoning ordinances. An appropriately qualified land use attorney should be engaged if a determination of compliance with zoning is required.

Entitlements
A summary of the current legal (entitlements) and physical status of the appraised properties is shown in the following table.

Entitlement Status
Description
Compl eted Single-FamiIy Homes without Complete Assessed Improvement Value Partially Complete Single FamiIy Homes (Under Construction) Finished Single Family Lots
Total
No. of
Homes/Lots
165
40 97
302
Altis Beaumont
1rr.

Land Description and Analysis 29
The balance of CFD No. 2016-3, 402 single-family residential homes, are reflected on the County of Riverside Assessor's Tax Roll with a complete assessment for both land and improvements and are not a part of this Appraisal Report.

Remaining Site Development Costs
Land development for the project has been completed; however, the master developer, Tri Pointe Homes, is obligated for a proportionate share of City infrastructure improvements encompassing all of the Sundance Specific Plan area, of which the subject property is a part. According to the Developer, there are approximately $5 million dollars in remaining costs benefiting all 4,299 lots/homes within the Sundance Specific Plan. The proportionate share of costs allocable to the Altis at Beaumont project (subject property) is estimated at $819,000 (704 lots/4,299 lots x $5mm). Applied to the 97 finished lots and 40 lots with homes under construction equates to $5,978 per lot ($819,000 / 137 lots), which will be accounted for in the valuation section later in this Appraisal Report.

Permits and Fees
Permits and fees represent all fees payable upon obtaining building permit for the construction of the proposed units and include school fees and impact fees. Based on information provided by the homebuilder, impact fees (DIF) are captured in the site development costs cited above.

Building permits and fees are projected to range from approximately $2,300 per unit to $3,200 per unit. For the purposes of this analysis, we have assumed building permits and fees at $3,000 per unit.

It is important to again note which fees the local market includes in the definition of an improved lot.

Though all of the fees above and on the previous page are due at or near building permit, the local market recognizes water fees, school fees, and impact fees as part of an improved lot value. Building permits are excluded from the improved lot value.

In the upcoming extraction analysis, only building permits (estimated at $3,000 per unit) will be deducted, as the remaining impact fees are included in the definition of an improved lot. These estimates of building permits and fees are consistent with our experience with other new home projects throughout Southern California. Any DIF or impact fees not yet paid will be deducted from the improved lot value conclusion to derive an estimate of market value for the subject lots.

Seismic Hazards
According to the Seismic Safety Commission, the subject site is located within Zone 4, which is considered to be the highest risk zone in California. There are only two zones in California: Zone 4, which is assigned to areas near major faults; and Zone 3, which is assigned to all other areas of more moderate seismic activity. In addition, the subject is located in a Fault -Rupture Hazard Zone (formerly referred to as an Alquist-Priolo Special Study Zone), as defined by Special Publication 42 (revised January 1994) of the California Department of Conservation, Division of Mines and Geology. In general, a number of faults are located in the Southern California and throughout California; thus, the area is subject to severe ground shaking during earthquakes. Competitive sites face similar seismic risk.

Altis Beaumont

Land Description and Analysis 30
Fire Hazard Risk
The City of Beaumont is served by the Riverside County Fire Department, which operates two fire stations in the city. Additionally, a third station (West Side Fire Station) broke ground in September of this year and is expected to improve response times for nearby communities including Olivewood, Tournament Hills and Tukwet. The City of Beaumont is heavily urbanized, subject primarily to urban structural fires. According to the CAL FIRE Fire and Resource Assessment Program, the subject is not located within a state responsibility area. The following map identifies areas of the city of Beaumont that have been classified as Fire Hazard Severity Zones. As shown in the following map, the subject is not located within a Very High Fire Hazard Severity Zone (VHFHSZ); however, many adjacent areas are.

Mir
l nerry valley
Beaumont
79 Subject
low
1 Gorgonm
Pass
Fire w,.[d se.ee:r, Zee
FrISZ in 5. • Effective April 1, 2024
ven 9
nryn
FHSZ In IPA- RadassiAnd hem SRA
HO
McCera.

FXSZ in LRA- Rernnimmderi 200]-2011
Environmental Hazards
An environmental assessment report was not provided for review, and during our inspection, we did not observe any obvious signs of contamination on or near the subject. However, environmental issues are beyond our scope of expertise. It is assumed that the property is not adversely affected by environmental hazards.

Easements, Encroachments and Restrictions
We were not provided a current title report to review. We are not aware of any easements, encroachments, or restrictions that would adversely affect value. Our valuation assumes no adverse impacts from easements, encroachments, or restrictions, and further assumes that the subject has clear and marketable title.

Altis Beaumont
'I irr

Land Description and Analysis 31
Conclusion of Site Analysis
Overall, the physical characteristics of the site and the availability of utilities result in functional utility suitable for a variety of uses including those permitted by zoning. Uses permitted by zoning include detached single-family units with a variety of densities. We are not aware of any other particular restrictions on development.

Altis Beaumont

Land Description and Analysis
32 Site Plan
Altis Beaumont

Land Description and Analysis
33 Altis Beaumont
Minimum Lot Size
50'x77' (152 LOTS)
® 45`x105' (205 LOTS)
50'x105' (183 LOTS)
55'x105' (164 LOTS)
Park
31 Planning Area Number

Land Description and Analysis
34 Parcel Maps
408-9a
Altis Beaumont

irr

Land Description and Analysis
35 408-96
40&95
408-97
fa i
40&98
I
Altis Beaumont

irr

Land Description and Analysis
36 Aerial
Date of photo: January 28, 2025
Altis Beaumont

irr

Proposed Improvements Description 37
Proposed Improvements Description
Overview
The subject property is being developed by TRIPointe and details of the active (and recently sold out) product lines is presented in the following table.

Floor Plan Summary
Living Typical Lot Developer's Base
Project Name Area (SF) Bedroom Bathroom Stories Garage Size (SF) Price Comments Rosa at Altis
Plan 1
Plan 2
Plan 3
Lina at Altis
Plan 1
Plan 2
Plan 3
Vita at Altis
Plan 1
Plan 2
Plan 3
Elan at Altis
Plan 1
Plan 2
Plan 3
Mira at Altis
Plan 1
Plan 2
Plan 3
Avid at Altis
Plan 1
Plan 2
Plan 3
1,419 2 2.0 One 2 -Car 4,725 $420,000
1,563 3 2.0 One 2 -Car 4,725 $450,000
1,763 4 2.5 One 2 -Car 4,725 $475,000
1,934 2 2.0 One 2 -Car 5,250 $485,500
1,989 2 2.0 One 2 -Car 5,250 $502,500
2,186 2 2.0 One 2 -Car 5,250 $526,000
1,473 2 2.0 One 2 -Car 3,850 N/Av Sold Out
1,534 2 2.0 One 2 -Car 3,850 N/Av Sold Out
1,682 2 2.0 One 2 -Car 3,850 N/Av Sold Out
2,278 2 2.5 One 2 -Car 5,775 N/Av Sold Out
2,404 2 2.5 One 2 -Car 5,775 N/Av Sold Out
2,559 2 2.5 One 2 -Car 5,755 N/Av Sold Out
1,970 2 2.0 One 2 -Car 4,725 N/Av Sold Out
2,174 2 2.5 One 2 -Car 4,725 N/Av Sold Out
2,230 2 2.0 One 2 -Car 4,725 N/Av Sold Out
1,661 2 2.0 One 2 -Car 5,250 N/Av Sold Out
1,802 2 2.0 One 2 -Car 5,250 N/Av Sold Out
1,929 2 2.0 One 2 -Car 5,250 N/Av Sold Out
The interior finish profile is considered to be of a typical quality for the area, which is generally average to good overall quality (please refer to the Builder's website for a complete description of interior finishes). The subject's floor plans are shown on the following pages.

Altis Beaumont

Proposed Improvements Description
38 Plan 1
Priced from $420,000

1.419
SO_FOOTAGE
2 2
BATHS

GARAGE
1,563
SO. FOOTAGE
BEDS
2 2
BAT HS

GARAGE

1.763
2 2-2.5
2 GARAGE
PLAN 1
WIC
Altis Beaumont
PLAN 2
PLAN 3

PRIMARY
SUITE

Proposed Improvements Description
39 Plan 1
Priced from $485,500
1,934
5O. FOOTAGE
2-3
BEDS
2-3
BATHS
2 GARAGE
PLAN 1 P R
Plan 2 •
Priced from $502,500

1.989

SO FOOTAGE
2-3
BEDS
2-2.5
BATHS
2 GARAGE

2.186
SO.FOOTAGE
2-3
BEDS
2-2.5
BATHS
2 GARAGE
PLAN 2AR
PLAN 3C
Altis Beaumont

irr.

Proposed Improvements Description
40 Altis Beaumont

irr

Proposed Improvements Description
41 Altis Beaumont

Proposed Improvements Description
42 Altis Beaumont

irr

Proposed Improvements Description
43 w r 4
:

Altis Beaumont

irr

Proposed Improvements Description
44 Altis Beaumont

irr

Real Estate Taxes 45
Real Estate Taxes
The property tax system in California was amended in 1978 by Article XIII to the State Constitution, commonly referred to as Proposition 13. It provides for a limitation on property taxes and for a procedure to establish the current taxable value of real property by reference to a base year value, which is then modified annually to reflect inflation (if any). Annual increases cannot exceed 2% per year.

The base year was set at 1975-76 or any year thereafter in which the property is substantially improved or changes ownership. When either of these two conditions occurs, the property is to be re- appraised at market value, which becomes the new base year assessed value. Proposition 13 also limits the maximum tax rate to 1% of the value of the property, exclusive of bonds and direct charges.

Bonded indebtedness approved prior to 1978, and any bonds subsequently approved by a two-thirds vote of the district in which the property is located, can be added to the 1% tax rate.

Ad Valorem Taxes
The existing ad valorem taxes are of nominal consequence in this appraisal, primarily due to the fact these taxes will be adjusted substantially as the remaining property improvements are completed and in consideration of the definition of market value employed in this appraisal, which assumes a sale of the appraised properties. According to the Riverside County Treasurer -Tax Collector's Office, the subject has a tax rate of 1.297010% for tax year 2024/25, based on assessed value. In addition, the appraised properties are subject to direct charges. Based on a survey of surrounding residential properties, it is estimated the subject would have direct charges of approximately $735 per lot.

Special Assessments
All of the appraised properties are encumbered by a Special Tax Lien associated with the City of Beaumont CFD No. 2016-3 (Altis) that also increases 2% per year. With respect to special taxes, we have relied upon information provided by the special tax consultant, for the annual special tax levy on the appraised properties, which are shown as follows for tax year 2024/25:

Special Tax Table (Fiscal Year 2024-2025)
Land Use Category
Square Footage Category Assigned Special Tax
Residential Property
Residential Property
Residential Property
Residential Property
Residential Property
Residential Property
Residential Property
Residential Property
Residential Property
Less than 1,426 SF
1,426 - 1,575 SF
1,576 - 1,725 SF
1,726 - 1,875 SF
1,876 - 2,025 SF
2,026 - 2,175 SF
2,176 - 2,325 SF
2,326 - 2,475 SF
Greater than 2,475 SF
$1,366 per unit
$1,436 per unit
$1,520 per unit
$1,590 per unit
$1,659 per unit
$1,785 per unit
$1,855 per unit
$1,980 per unit
$2,058 per unit
Source: Rate and Method of Apportionment of Special Taxes Altis Beaumont

Highest and Best Use 46
Highest and Best Use
Process
Before a property can be valued, an opinion of highest and best use must be developed for the subject site, both as if vacant, and as improved or proposed. By definition, the highest and best use must be:
• Legally permissible under the zoning regulations and other restrictions that apply to the site. • Physically possible.
• Financially feasible.
• Maximally productive, i.e., capable of producing the highest value from among the permissible, possible, and financially feasible uses.

Highest and Best Use As If Vacant
Legally Permissible
The site is zoned PA 30, 31, 33, 34, Planning Area (Sundance Specific Plan) Low, Low -Medium and Medium Density Residential. Permitted uses include detached single-family units with a variety of densities. To our knowledge, there are no legal restrictions such as easements or deed restrictions that would effectively limit the use of the property. The subject property has an approved tentative/final map for 704 single-family homes on individual lots and associated improvements. The subject's present entitlements are the result of significant planning and review, and any rezone or land use different than currently approved is unlikely. Given prevailing land use patterns in the area, only single family residential is given further consideration in determining highest and best use of the site, as though vacant.

Physically Possible
The physical characteristics of a site that affect its possible use include, but are not limited to, location, street frontage, visibility, access, size, shape, topography, availability of utilities, offsite improvements, easements and soil and subsoil conditions. The legally permissible test has resulted in single-family residential development; at this point the physical characteristics are examined to see if they are suited for the legally permissible use.

Based on our physical inspection of the subject property, we know of no reason why the property would not support development. All utilities are available to the perimeter of the site. The property is not located within an adverse earthquake, flood, or fire zone. Further, the subject is proximate to new development and development appears possible. Surrounding land uses are compatible and/or similar. Development on adjacent properties provides support that soils are adequate for development. Based on the physical characteristics of the subject property, residential development is considered physically possible and most appropriate
Financially Feasible
Financial feasibility depends on supply and demand influences. With respect to financial feasibility of single-family residential development, in recent months merchant builders have acquired unimproved lots for near term construction, and there are multiple active projects in the area that demonstrate Altis Beaumont

irr.

Highest and Best Use 47
demand for new homes. Finished lots are transferring for prices that exceed the sum of unimproved lots and site development costs, which reflects completion of site development is financially feasible.

Maximally Productive
Legal, physical, and market conditions have been analyzed to evaluate the highest and best use of the appraised properties as vacant. The analysis is presented to evaluate the type of use(s) that will generate the greatest level of future benefits possible to the property. Based on the factors previously discussed, the maximally productive use of the appraised properties, and their highest and best use as vacant, is for near -term single-family residential development.

As Improved (Proposed)
As with the highest and best use as though vacant, the four tests of highest and best use must also be applied to the subject property considering the in -place improvements. Consideration must be given to the continued as -is use of the subject, as well as alternative uses for the subject. The potential alternative uses consist of demolition, expansion, conversion or renovation.

In the case of undeveloped land under development, consideration must be given to whether it makes sense to demolish existing improvements (either on -site or off -site improvements) for replacement with another use. The time and expense to demolish existing improvements, re -grade, reroute utilities or re -map must be weighed against alternative uses. If the existing or proposed improvements are not performing well, then it may produce a higher return to demolish existing improvements, if any, and re -grade the site for development of an alternative use.

Based on the current condition, the improvements completed contribute to the overall property value. The value of the subject property as improved exceeds its value as vacant less demolition. The highest and best use of the subject property as improved is for continuing construction of homes, as dictated by demand.

Most Probable Buyer
In conjunction with the definition of market value, this appraisal assumes a hypothetical sale of the subject properties to a probable buyer/user, as of the date of value. The subject is considered to have good appeal for production homes. The most probable buyer would be a developer/homebuilder for the finished lots and homes under construction. The most probable buyer for the completed homes would be an individual homeowner.

Altis Beaumont

irr.

Valuation Methodology 48
Valuation
Valuation Methodology
Appraisers usually consider three approaches to estimating the market value of real property. These are the cost approach, sales comparison approach and the income capitalization approach.

The cost approach assumes that the informed purchaser would pay no more than the cost of producing a substitute property with the same utility. This approach is particularly applicable when the improvements being appraised are relatively new and represent the highest and best use of the land or when the property has unique or specialized improvements for which there is little or no sales data from comparable properties.

The sales comparison approach assumes that an informed purchaser would pay no more for a property than the cost of acquiring another existing property with the same utility. This approach is especially appropriate when an active market provides sufficient reliable data. The sales comparison approach is less reliable in an inactive market or when estimating the value of properties for which no directly comparable sales data is available. The sales comparison approach is often relied upon for owner -user properties.

The income capitalization approach reflects the market's perception of a relationship between a property's potential income and its market value. This approach converts the anticipated net income from ownership of a property into a value indication through capitalization. The primary methods are direct capitalization and discounted cash flow analysis, with one or both methods applied, as appropriate. This approach is widely used in appraising income -producing properties.

Additional analyses often undertaken in the valuation of subdivisions include extraction, land residual analysis, and the subdivision development method.

Reconciliation of the various indications into a conclusion of value is based on an evaluation of the quantity and quality of available data in each approach and the applicability of each approach to the property type.

The methodology employed in this assignment is summarized as follows:

Approaches to Value
Approach
Applicability to Subject Use in Assignment
Cost Approach Not Applicable
Sales Comparison Approach Applicable
Income Capitalization Approach Not Applicable
Not Utilized
Utilized
Not Utilized
Altis Beaumont

Market Valuation — Completed Homes 49
Market Valuation — Completed Homes
The market value of the subject's smallest floor plan is estimated in this section using the sales comparison approach to value. A summary of the smallest floor plans within the subject's active and recently sold -out product lines is presented in the table below:

Smallest Floor Plan Summary
Living Typical Lot Developer's Base
Floor Plan Area (SF) Bedroom Bathroom Stories Garage Size(SF) Price Comments Rosa 1,419 2 2.0 One 2 -Car 4,725 $420,000
Lina 1,934 2 2.0 One 2 -Car 5,250 $485,500
Vita 1,473 2 2.0 One 2 -Car 3,850 N/Ap
Elan 2,278 2 2.5 One 2 -Car 5,775 N/Ap
Mira 1,970 2 2.0 One 2 -Car 4,725 N/Ap
Avid 1,661 2 2.0 One 2 -Car 5,250 N/Ap
Sold Out
Sold Out
Sold Out
Sold Out
This approach is based on the economic principle of substitution. According to The Appraisal of Real Estate, 15th Edition (Chicago: Appraisal Institute, 2020), "The principle of substitution holds that the value of property tends to be set by the cost of acquiring a substitute or alternative property of similar utility and desirability within a reasonable amount of time." The sales comparison approach is applicable when there are sufficient recent, reliable transactions to indicate value patterns or trends in the market.

The proper application of this approach requires obtaining recent sales data for comparison with the appraised properties. In order to assemble the comparable sales, we searched public records and other data sources for leads, then confirmed the raw data obtained with parties directly related to the transactions (primarily brokers, buyers and sellers). The comparables utilized in the following analysis are from sales within the subject's communities, sales from surrounding communities, and the MLS.

The objective of the analysis is to estimate the base price, net of incentives, upgrades and lot premiums. Incentives can take the form of direct price reductions or non -price incentives such as upgrades, interest rate buydowns, or non -recurring closing costs. Further, for the homes with various options of the number of bedrooms or bathrooms, consistent with the "not -less -than" valuation, we will utilize the lesser of the two options.

Altis Beaumont

irr.

Market Valuation — Completed Homes 50
In order to estimate not -less -than market values for the various floor plans offered within each of the six product lines with completed homes comprising CFD No. 2016-3, a summary of historical home sales, per square foot, for the smallest floor plan within each product line was provided for consideration, and are summarized as following.

Historical Sale Summary
Product Line
Floor Plan Size
(SF)
1,419 $276 $336 $298
1,934 $232 $285 $250
1,473 $201 $329 $258
2,278 $162 $293 $216
1,970 $176 $357 $245
1,661 $203 $318 $230
Min. Price/SF Max. Price/SF Avg. Price/SF
Rosa
Lin a
Vita
Elan
Mira
Avi d
A summary of the most recent sales within the city of Beaumont is included in the following table.

Comparable Home Sale Summary
No. Address
1 1581 Winding Sun Dr
2 1574 Turningcrest Ln
3 35160 Vidalia Ln
4 35327 Garcia St
5 14223 Sicily Ct
6 1570 Park Haven
7 35173 Savory Ln
8 1644 Park Village Dr
9 35244 Guldahl Ct
10 1566 Park Haven Dr
11 14079 Dandolo Ln
Close of Living Area Lot Size
Escrow SalePrice Sale Price/SF (SF) Bedroom Bathroom Garage Year Built (SF) 10/29/2024 $424,571 $299 1,419 2 2.0 2 -Car 2024 5,262
9/3/2024 $438,059 $309 1,419 2 2.0 2 -Car 2024 6,105
8/27/2024 $483,322 $314 1,541 3 2.0 2 -Car 2024 7,030
12/17/2024 $520,595 $320 1,628 3 2.0 2 -Car 2024 5,000
10/19/2024 $514,990 $299 1,722 3 2.5 2 -Car 2024 5,227
11/19/2024 $475,000 $246 1,934 3 2.0 2 -Car 2023 6,425
8/8/2024 $499,686 $255 1,957 3 2.5 2 -Car 2024 4,214
12/2/2024 $539,673 $271 1,989 3 2.0 2 -Car 2024 6,270
12/2/2024 $553,595 $254 2,176 4 2.5 2 -Car 2024 6,970
1/15/2025 $600,000 $274 2,186 3 2.5 2 -Car 2023 6,425
8/7/2024 $564,575 $250 2,261 4 3.0 2 -Car 2024 5,749
Altis Beaumont

irr.

Market Valuation — Completed Homes
51 Discussion of Adjustments
The sales are compared to the subject and adjusted to account for material differences that affect value. Adjustments are considered for the following factors, in the sequence shown below.

Adjustment Factor Accounts For
Comments
Upgrades and
Incentives
The objective of the analysis is to
estimate the base value per floor
plan, net of incentives. Incentives
can take the form of direct price
reductions or non -price incentives
such as upgrades or non -recurring
closing costs.

Real Property Rights Fee simple, leased fee, leasehold, partial interest, etc.

Financing Terms
Conditions of Sale
Market Conditions
(Date of Sale, Phase
Adjustment)
Location
Seller financing, or assumption of
existing financing, at non -market
terms.

Extraordinary motivation of buyer
or seller, assemblage, forced sale.

The market conditions vary over
time, but the date of this appraisal
is for a specific point in time. In a
dynamic economy — one that is
undergoing changes in the value of
the dollar, interest rates and
economic growth or decline — extra
attention needs to be paid to assess
changing market conditions.

Significant monthly changes in price
levels can occur in several areas of a
neighborhood, while prices in other
areas remain relatively stable.

Although the adjustment for market
conditions is often referred to as a
time adjustment, time is not the
cause of the adjustment.

Location is a very important factor
to consider when making
comparisons. The comparables
Incentives and upgrades included in
the sales have been considered in
this analysis.

All of the comparables represent
fee simple estate transactions.

Therefore, consideration for this
factor is not necessary.

No consideration is required for this
factor.

All of the comparable transactions
represent arm's -length, market
transactions.

As demonstrated in the previous
market analysis section, new home
pricing has been fluctuating over
the past twelve months in the
subject's market area, as well as
within the region overall. Home
pricing over the past 6 months has
remained somewhat stable, as
incentives in the form of interest
rate buy downs remains a popular
program for many homebuilders; as
such, no adjustments are
considered for market conditions as
of the date of value.

The comparables are located within
the City of Beaumont and no
Altis Beaumont

Market Valuation — Completed Homes
52 Adjustment Factor Accounts For
Comments
Community Appeal
Lot Size
Lot Premiums/
Discounts
Design and
Appeal/Quality of
Construction
Altis Beaumont
need not be in the same
neighborhood but should be in
neighborhoods that offer the same
advantage and have, in general, the
same overall desirability to the
most probable buyer or user.

Community characteristics that may
influence sale prices include a gated
amenity or the condition of
surrounding development.

The lot size adjustment pertains to
the differences between the
subject's average lot size and
comparables with either larger or
smaller lots. It does not include any
lot premium adjustments, which are
adjusted for separately. The
amount of the adjustment used in
the comparison of the base lot sizes
comes from a survey of premiums
paid for larger lots.

Properties sometimes achieve
premiums for corner or cul-de-sac
positioning, or proximity to open
space or views. Adjustments for lot
position premiums would be in
addition to lot size adjustments
previously considered.

Design and appeal of a floor plan is
consumer specific. One exterior
may appeal to one buyer, while
another appeal to a different buyer.

These types of features for new
homes with similar functional utility
are not typically noted in the base
sales prices.

Construction quality can differ from
slightly to substantially between
projects and is noted in the exterior
and interior materials and design
features of a standard unit.
consideration is warranted for this
category.

The subject and all of the
comparables have similar
community appeal and adjustments
are not considered.

Considering the typical lot sizes of
the subject's projects, an
adjustment factor is considered for
those comparables with appreciably
larger lots.

The comparables are similar to the
subject's projects; no consideration
is necessary
The comparables are similar to the
subject property in regard to design
and appeal.

In terms of quality of construction,
the subject property represents
average -to -good construction
quality. All of the comparable sales
feature similar construction quality
and do not require consideration.

Market Valuation — Completed Homes
53 Adjustment Factor Accounts For
Comments
Age/Condition
Functional Utility
Number of Stories
Parking/Garage
When comparing resale to resale,
the market generally reflects a
difference of 1% per year of
difference in effective age.

Ability to adequately provide for its
intended purpose.

For similar size units, the
differences between the number of
stories is typically a buyer
preference. One buyer might prefer
a single -story versus a two-story
unit.

Number of garage spaces
The sales represent new
construction at the time with a
similar effective age as the subject
property; no consideration for
differences in age/condition is
necessary.

The appraised properties and
comparables represent traditional
detached single-family residential
construction on similar lot size
categories as the subject.

Adjustments for this factor do not
apply.

All the subject floor plans comprise
single -story designs. In current
market conditions, single story floor
plans typically demand a slight
premium. As such, consideration is
given to story differences.

The subject's floor plans and all of
the comparables offer two -car
garages. No adjustments are
considered.

Altis Beaumont

irr.

Market Valuation — Completed Homes 54
Conclusion of Home Values
As shown at the beginning of this section, the recent and historical sales within the subject suggest a market value between $162 and $357 per square foot, all else being equal, with the low end reflective of the largest floor plan offered (and the earliest sales). These figures are supported by the comparable sales at competing projects. Based on the analysis herein, and reported sales from the active single-family subdivisions within the subject property, the following table reflects a not -less - than market value estimate for the representative floor plans/homes within the subject property:

Floor Plan Value Conclusions
Living Typical Lot Market Concluded Base
Floor Plan Area (SF) Bedroom Bathroom Stories Garage Size (SF) Value/SF Retail Value (Rd) Rosa 1,419 2 2.0 One 2 -Car 4,725 $295 $420,000
Lina 1,934 2 2.0 One 2 -Car 5,250 $250 $484,000
Vita 1,473 2 2.0 One 2 -Car 3,850 $300 $442,000
Elan 2,278 2 2.5 One 2 -Car 5,775 $250 $570,000
Mira 1,970 2 2.0 One 2 -Car 4,725 $250 $493,000
Avid 1,661 2 2.0 One 2 -Car 5,250 $299 $497,000
The conclusions above will be incorporated in the market value by ownership section at the end of this Appraisal Report.

Altis Beaumont

Land Residual Analysis 55
Land Residual Analysis
The land residual analysis is employed as an additional indicator of market value for the subject's benchmark lot size. The subject contains four lot size categories ranging in size from 3,825 to 5,775 square feet, with counts ranging from 125 to 205. For the purposes of this analysis, we will utilize a benchmark lot size of 4,725 square feet with a typical market transaction size of 60 lots.

This valuation method is used in estimating land value when subdivision and development are the highest and best use of the land being appraised. All direct and indirect costs are deducted from an estimate of the anticipated gross sales price of the improved product; the resultant net sales proceeds are then discounted to present value at an anticipated rate over the development and absorption period to indicate the value of the land. The land residual analysis is conducted on a quarterly basis. As a discounted cash flow analysis, the land residual analysis consists of four primary components summarized as follows:

Revenue — the gross income is based on the sale of completed homes.

Absorption Analysis — the time frame required for sell off. Of primary importance in this analysis is the allocation of the revenue over the absorption period — including the estimation of an appreciation factor (if any).

Expenses — the expenses associated with the sell-off are calculated in this section — including direct and indirect construction costs, administration, marketing and commission costs, as well as taxes and special taxes.

Discount Rate — an appropriate discount rate is derived employing a variety of data.

Discussions of these four concepts follows below, with the discounted cash flow analysis offered at the end of this section.

Revenue
The projected sales price for the average unit within the project will vary, as the ultimate sales price is affected by unit size, location within the project, site influences, construction costs, anticipated premiums achievable at the point of retail sale, as well as external influences such as adjacent land uses.

The benchmark lot category has 60 lots with a typical lot size of 4,725 square feet. Based on the Residential Market section of this report and considering current asking prices, we estimate a typical average -sized home on the subject would contain approximately 1,800 square feet and would have a corresponding base price of $475,000. These estimates will be utilized in the analysis.

Closing Projections
The typical time required for the construction of units has been approximately three to six months from start to closing. It is assumed that initial closings will occur within three to six months of the date of sale. The premise is that the builder constructs efficiently as homes are sold. These assumptions are reflected in the projected construction schedule shown in the land residual models at the end of this Altis Beaumont

Land Residual Analysis 56
section. Since the land residual analysis is conducted on a quarterly basis, closings are reflected in the following period, as most construction will be substantially completed prior to initiation of sales.

Changes in Market Conditions (Price Increases or Decreases) The subject's market area has experienced rapid market appreciation in home prices for the past few years; however, since early 2022 the Federal Reserve Bank began raising the benchmark federal -funds rate (from near zero in March 2022) in an effort to manage rising inflation. The fed -funds rate is greater than 5%, which has resulted in a substantial rise in mortgage interest rates, which now average 6.5%-7.0% and have moderated from a high of 8.0% in October of 2023. The rise in mortgage interest rates has impacted the affordability of homes for a certain segment of the homebuyer market, which may impact pricing in the near term. Consequently, under current market conditions, forecasting home appreciation during the absorption period is speculative, and several homebuilders surveyed indicate they typically do not trend/forecast home appreciation during the sell-off period.

Therefore, for purposes of this analysis, the home price revenue will be held constant during the sell- off period.

Absorption
Typically multiple product lines would be marketed in a subdivision to create characteristics appealing to as many potential purchasers as possible. Offering home products within a subdivision to different market segments is done with the aim of increasing absorption and reducing the overall development holding period for a project.

Based on the typical marketing and absorption rate data presented in the Residential Market overview, we estimate an absorption rate of approximately 3 units per month or 9 units per quarter.

Home sales begin in Period 1, and the subject lots sell out in Period 7, with Period 8 needed to complete construction and close escrow. Our disposition period for the subject lots is over the course of two years. Market conditions are anticipated to remain stable over this time.

Expense Projections
As part of an ongoing effort to assemble market information, the table below reflects survey responses and developer budget information for numerous single-family residential subdivisions throughout the California region.

Altis Beaumont

Land Residual Analysis 57
Subdivision Budgets
Budget No. of Avg. Home Typical Lot G&A%of Mkt & Sales %of Direct Indirect Indirect %of Site Permits & Cost per Profit%of Developer Classification Date Units
Quality Size (SF) Size Revenue Revenue Costs/SF Costs/SF Direct Costs Costs/Lot Fees/Unit Model Revenue National 2023 85 Average 1,844 3,000 N/Av N/Av $96.00 N/Av N/Av $65,855 $48,588 N/Av N/Av National 2023 202 Average 2,342 7,250 N/Av N/Av $72.06 $11.06 15.35% $76,242 $73,000 N/Av N/Av National 2023 276 Average 2,220 7,200 N/Av N/Av $74.96 $11.09 14.79% $83,185 $32,800 $80,339 N/Av Regional 2023 52 Average 2,607 6,200 N/Av 5.80% $101.86 $6.86 6.73% $164,076 $73,595 N/Av 10.06% National 2023 177 Average 2,112 7,200 N/Av N/Av $77.91 $9.73 12.49% $110,669 561,700 N/Av N/Av National 2023 85 Average 2,118 4,800 2.25% 2.25% $96.79 $9.92 10.24% N/Av $88,700 N/Av N/Av National 2023 573 Average 2,327 5,232 N/Av N/Av $99.86 N/Av 2.50% $126,003 $98,422 N/Av 20.00% National 2022 150 Average 2,092 5,500 N/Av N/Av $92.11 N/Av N/Av $72,875 $51,700 N/Av 20.5% National 2022 96 Average 2,346 7,350 N/Av N/Av $79.46 N/Av N/Av $124,544 $68,647 $164,265 N/Av Local 2022 91 Average 2,160 5,475 5.0% 1.0% $117.00 N/Av N/Av N/Av $52,790 N/Av 10.0% National 2022 862 Average 2,176 5,306 N/Av N/Av $112.00 N/Av N/Av $161,203 $52,801 N/Av N/Av National 2022 387 Average 1,771 5,000 6.0% 3.0% $105.39 N/Av N/Av N/Av $43,000 N/Av 28.0% National 2022 187 Average 2,420 6,698 N/Av N/Av $95.00 N/Av N/Av $255,045 $77,870 N/Av N/Av Local 2022 99 Good 2,614 5,500 5.5% 1.2% $95-$105 N/Av N/Av $100,600 $48,599 $125,000 29.0% Regional 2022 49 Average 2,062 6,600 3.0% 3.9% $104.63 N/Av N/Av $82,916 $56,472 N/Av 20.9% Regional 2021 87 Average 1,978 6,500 N/Av N/Av $98.00 N/Av N/Av $96,759 $63,947 N/Av N/Av Regional 2021 145 Average 2,109 5,775 4.2% 4.25 $79.86 $13.01 16.4% $94,951 $37,659 $54,000 6.8% Regional 2021 128 Average 2,009 2,565 3.0% 3.5% $87.42 $16.63 19.0% N/Av 554,371 N/Av 14.0% Local 2021 36 Good 2,533 3,450 5.5% 6.6% $112.26 $5.53 4.9% N/Av $55,497 N/Av 15.0% National 2021 124 Average 1,753 6,723 N/Av N/Av $102.12 N/Av N/Av $41,505 $51,458 N/Av N/Av Local 2021 21 Average 2,010 6,050 N/Av N/Av $102.50 N/Av N/Av $78,415 $44,500 N/Av N/Av Local 2021 12 Good 1,909 3,450 N/Av 1.4% $189.48 $31.64 16.7% $96,162 $36,270 N/Av 20.0% Regional 2021 147 Average 2,200 3,825 N/Av N/Av $76.00 N/Av 7.0% $43,972 $48,197 N/Av N/Av Regional 2021 72 Good 2,551 3,800 N/Av 7.4% $88.00 N/Av N/Av $112,128 $63,610 N/Av 9.5% Regional 2020 81 Average 1,974 5,775 N/Av 2.5% $80.00 $16.00 20% $83,788 $81,336 N/Av N/Av Local 2020 51 Average 2,106 6,955 3.3% 4.0% $91.50 $10.07 11% $122,885 $66,000 $38,500 20.0% National 2020 14 Average 2,165 3,500 N/Av 3.2% $95.00 $11.02 12% N/Av $68,214 N/Av N/Av National 2020 48 Average 2,102 5,250 2.4% 6.1% $124.00 $20.13 16% $102,134 $53,000 $126,000 16.1% Regional 2020 112 Average 2,060 6,300 4.6% 4.1% $80.23 N/Av 10% $86,830 $63,400 $108,380 13.20% Regional 2020 30 Average 2,672 5,000 9.8% 6.3% $88.79 N/Av 10% $91,600 $62,730 N/Av 12.2% Information from the survey above will contribute to the estimate of development expenses classified as follows.

General and Administrative
These expenses consist of management fees, liability and fire insurance, inspection fees, appraisal fees, legal and accounting fees and copying or publication costs. This expense category typically ranges from 2.5% to 4.0%, depending on length of project and if all of the categories are included in a builder's budget. We have used 3.0% for general and administrative expenses.

Marketing and Sale
These expenses typically consist of advertising and promotion, closing costs, sales operations, and sales commissions. The expenses are expressed as a percentage of the gross sales revenue. The range of marketing and sales expenses typically found in projects within the subject's market area is 5.0% to

6.5%. A figure of 5.0%, or 2.5% for marketing and 2.5% for sales, is estimated in the marketing and sales expense category.

Property Taxes (Ad Valorem and Special Taxes)
The subject is located within an area with an effective tax rate of 1.2970%. This amount is applied to the estimated market values and divided by the total number of units to yield an estimate of ad valorem taxes/unit/year for each phase. The tax amounts are applied to unclosed inventory over the sell-off period. Property taxes are increased by 2% per year.

The subject is within the boundary of the City of Beaumont CFD No. 2016-3 (Altis). Special Taxes associated with the subject's benchmark lot size within the District, for the most recently available tax year amount to $1,590 per unit, which is utilized in the analysis, in addition to $735 of additional Altis Beaumont

irr.

Land Residual Analysis 58
direct charges per unit. The total tax expense is gradually reduced over the absorption period, as the land components are sold off.

HOA
A homeowner's association (HOA) is planned for the subject. According to the developer the estimated HOA fee applicable to the subject property is $305 per home per month, which is similar to other new home projects in the area and will therefore be utilized in the analysis.

Permits and Fees
Based on the information provided, the estimate of net permits and fees for the subject are estimated at $3,000 per lot.

Direct and Indirect Construction Costs
Construction costs are generally classified into direct and indirect costs. Direct costs reflect the cost of labor and materials to build the project. Direct costs generally are lower per square foot for larger floor plans, all else being equal, due to economies of scale. Indirect items are the carrying costs and fees incurred in developing the project and during the construction cycle. Construction quality and market -segment are significant factors that affect direct construction costs. In addition, national/public builders, which are able to achieve lower costs due to the larger scale in which orders are placed, routinely achieve lower direct costs.

Recent conversations with homebuilders confirm construction costs have stabilized over the last 12 months. Based on the cost comparables, and considering the product line under development, a direct cost estimate of $85.00 per square foot is applied the estimated home. This estimate is generally consistent with comparables in the market.

Regarding indirect costs, the following list itemizes some of the typical components that generally comprise indirect costs:
• Architectural and engineering fees for plans, plan checks, surveys and environmental studies • Appraisal, consulting, accounting and legal fees
• The cost of carrying the investment in land and contract payments during construction. If the property is financed, the points, fees or service charges and interest on construction loans are considered
• All-risk insurance
• The cost of carrying the investment in the property after construction is complete, but before sell-out is achieved
• Developer fee earned by the project coordinator
• Interest reserve
Altis Beaumont

Land Residual Analysis 59
Conversations with homebuilders indicate the indirect costs generally range anywhere from 10% to 15% of the direct costs (excluding marketing, sales, general and administrative expenses, taxes, which are accounted for separately). An estimate of 15% is considered reasonable for the subject.

Model Complex
Based on the product line offered, 3 model homes are utilized to market the homes for the subject property, which is considered to be reasonable.

Model upgrade expenses can vary widely depending upon construction quality, targeted market and anticipated length of time on the market. These upgrades, exterior and interior, including furniture, can range from $20,000 per model to over $250,000 per model for executive homes.

Based on the quality of the subject's proposed improvements and the targeted buyer segment, a model upgrade cost of $75,000 per model is considered reasonable for the subject's lots. Of this amount approximately 30% will be recaptured with the sale of the models reflecting a recapture of $22,500 per model. Model costs will be incurred in the first period while the recapture amount will be applied evenly over the disposition period.

Summary
The following chart summarizes the revenue and expenses discussed on the preceding pages.

Altis Beaumont

Land Residual Analysis
60 Revenue & Expense Summary

REVENUE SUMMARY
Floor Plan
No. of
Units
Unit
Size (SF)
Base Retail
$/SF Value Per Unit Extension
Average Unit
Model Recapture
(@ 30% of cost)
60 1,800 $264 $475,000 $28,500,000
60 1,800
(weighted avg.)
Total Revenue Before Appreciation:

Total Revenue After Appreciation:
$67,500
28,567,500
$476,125 /unit
28,567,500
$476,125 /unit

EXPENSES SUMMARY
General and Administrative
Marketing and Sales
Ad Valorem Taxes
Direct Charges
Special Taxes/Assessments
Homeowner's Association Fees
Model Costs
Permits and Fees
Subtotal:

3.0% of total revenue

5.0% of total revenue
$2,419 /unit/year
$735 /unit/year
$1,590 /unit/year
$305 /unit/month
3 models
Total Over Sell -Off Period
$ 857,025
$ 1,428,375
$ 141,034 (from cash flow)
$ 42,826 (from cash flow)
$ 92,704 (from cash flow)
$ 211,365 (from cash flow)
$ 225,000 $75,000 (per model)
$ 180,000 $3,000 (per unit)
$ 3,178,329
Direct Construction Costs (Before Appreciation) SF Units Cost SF Extension Average/Typical Floor Plan 1,800 60 $85.00 $ 9,180,000 $153,000 /unit Indirect Construction Costs 15% of Direct Costs
Su btota l :
$ 1,377,000
$ 10,557,000
Total Expenses Before Appreciation: $ 13,735,329
$22,950 /unit
Internal Rate of Return and Discount Rate
According to industry sources, project yield rates historically have ranged anywhere from 5% to 25%.

A yield rate is based on the perceived risk associated with the development.

Positive attributes of the subject property include steady demand in the market area and limited new construction. There are some "negative" attributes associated with the subject such as rising construction costs, in addition to the potential for deterioration in market conditions in the residential sector that would result from a change in macroeconomic factors (ex. continued high inflation, unemployment rates, interest rates, etc.).

Using a 5.00% present value factor and 10.00% for developer's incentive, results in an implied internal rate of return (IRR) of 21.900%.

Realty Rates provides expected Developer IRR for California developments as follows:

Altis Beaumont

Land Residual Analysis 61
California/Pacific Islands: Subdivisions & PUDs
Site -Built Residential
- 100 Units
100-500 Units
500+ Units
Mixed Use
Manufactured Housing
- 100 Units
100-500 Units
500+ Units
Business Parks
- 100 Acres
100-500 Acres
500+ Acres
Industrial Parks
- 100 Acres
100-500 Acres
500+ Acres
Actual Rates Pro -Forma Rates
Min Max Avg Min Max Avg

17.52% 38.61% 26.04% 16.82% 37.06% 25.00%

17.52% 33.28% 24.89% 16.82% 31.95% 23.90%

17.96% 36.61% 26.19% 17.24% 35.15% 25.15%

18.40% 38.27% 26.64% 17.66% 36.74% 25.57%

18.84% 38.61% 26.42% 18.08% 37.06% 25.37%

18.06% 42.18% 27.94% 17.34% 40.49% 26.82%

18.06% 36.68% 26.82% 17.34% 35.21% 25.75%

18.51% 40.34% 28.25% 17.77% 38.73% 27.12%

18.97% 42.18% 28.74% 18.21% 40.49% 27.59%

18.04% 40.29% 27.08% 17.32% 38.68% 25.99%

18.04% 35.04% 26.01% 17.32% 33.63% 24.97%

18.50% 38.54% 27.38% 17.76% 37.00% 26.28%

18.95% 40.29% 27.84% 18.19% 38.68% 26.73%

18.15% 34.00% 24.28% 17.42% 32.64% 23.31%

18.15% 29.56% 23.38% 17.42% 28.38% 22.44%

18.60% 32.52% 24.54% 17.86% 31.22% 23.56%

19.05% 34.00% 24.93% 18.29% 32.64% 23.94%
*2nd Quarter2024 Data
Realty Rates Developers Survey 2024 Q4
California/Pacific Islands: CA, Guam, HI
California/Pacific Islands: Condominiums & Co-Ops
Primary Residential
Hi-Rise/Urban Townhouse
Garden/Suburban Townhouse
Mixed Use
Resort & Second Home
Hi -Rise
Garden/Townhouse
Commercial/Industrial
Urban Office
Suburban Office
Retail
Industrial
Actual Rates Pro -Forma Rates
Min Max Avg Min Max Avg

13.08% 21.68% 16.73% 12.20% 20.81% 15.97%

13.39% 21.64% 17.16% 12.85% 20.78% 16.48%

13.08% 20.76% 16.24% 12.56% 19.93% 15.59%

13.27% 21.68% 16.77% 12.20% 20.81% 15.85%

14.21% 23.51% 17.56% 13.64% 22.57% 16.86%

14.32% 23.51% 18.54% 13.75% 22.57% 17.79%

14.21% 20.36% 16.59% 13.64% 19.54% 15.93%

11.74% 22.66% 16.19% 11.27% 21.76% 15.54%

12.52% 21.19% 16.52% 12.02% 20.34% 15.86%

11.92% 21.15% 15.88% 11.45% 20.31% 15.24%

12.22% 22.66% 16.74% 11.73% 21.76% 16.07%

11.74% 20.79% 15.61% 11.27% 19.96% 14.99%
*2nd Quarter 2024 Data
Realty Rates Developers Survey 2024 Q4
California/Pacific Islands: CA, Guam, HI
The survey above is primarily focused on raw land development; whereas, the subject property is analyzed herein as if improved (finished lot, or improved site, condition), which carries less risk.

Altis Beaumont

Land Residual Analysis 62
Conclusion
The land residual analysis is presented as follows:

Land Residual Analysis
Quarter: 1 2 3 4 5 6 7 8 Total

ABSORPTION
Sales
Close of Escrow (COE)
Unsold Inventory
Sales Revenue (Before Appreciati on)
Annual Appreciation Factor
Sales Revenue (After Appreciation)
Total Sales Revenue (at Close of Escrow)
9 9 9
0 9 9
9 9
9 9 6 0 60
9 9 9 6 60
60 51 42 33 24 15
6 0
$ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 2,856,750 $ - 0% 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 2,856,750 $ -

EXPENSES AND CASH FLOWS
General and Administrative 3.0%
Marketing and Sales 5.0%
Ad Valorem Taxes ($/unit/yr) $2,419
Direct Charges ($/unit/yr) $735
Special Taxes/Assessments ($/unit/yr) $1,590
Homeowner's Association Fees Ohm it/mo) $305
Model Costs
Permits and Fees
Subtotal:

Direct Constructi on Costs
Annual Appreciation Factor
Direct Constructi on Costs (Appreciated)
Indirect Construction Costs
Subtotal:

Total Expenses
0%
15%
$ 28,567,500
$ - $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 4,285,125 $ 2,856,750 $ 28,567,500 (107,128) $ (107,128) $ (107,128) $ (107,128) $ (107,128) $ (107,128) $ (107,128) $ (214,256) $ (214,256) $ (214,256) $ (214,256) $ (214,256) $ (214,256) (36,284) $ (30,995) $ (25,653) $ (20,257) $ (14,806) $ (9,300) $ (3,739) (11,018) $ (9,412) $ (7,790) $ (6,151) $ (4,496) $ (2,824) $ (1,135) (23,850) $ (20,374) $ (16,862) $ (13,315) $ (9,732) $ (6,113) $ (2,457) (54,900) $ (46,665) $ (38,430) $ (30,195) $ (21,960) $ (13,725) $ (5,490) (225,000) $ - $ - $ - $ - $ - $
(27,000) $ (27,000) $ (27,000) $ (27,000) $ (27,000) $ (27,000) $ (18,000) (485,180) $ (455,831) $ (437,120) $ (418,303) $ (399,379) $ (380,346) $ (352,206) (688,500) $ (1,377,000) $ (1,377,000) $ (1,377,000) $ (1,377,000) $ (1,377,000) $ (1,147,500)

1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000
(688,500) $ (1,377,000) $ (1,377,000) $ (1,377,000) $ (1,377,000) $ (1,377,000) $ (1,147,500) (103,275) $ (206,550) $ (206,550) $ (206,550) $ (206,550) $ (206,550) $ (172,125) (791,775) $ (1583,550) $ (1,583,550) $ (1,583,550) $ (1,583550) $ (1,583,550) $ (1,319,625) (107,128) $ (857,025)
(142,838) $ (1,428,375)
- $ (141,034)
$ (42,826)
$ (92,704)
$ (211,365)
$ (225,000)
$ (180,000)
(249,966) $ (3,178,329)
(459,000)

1.0000
(459,000)
$ (9,180,000)
(68,850) $ (1,377,000)
(527,850) $(10,557,000)
$ (1,276,955) $ (2,039,381) $ (2,020,670) $ (2,001,853) $ (1,982,929) $ (1,963,896) $ (1,671,831) $ (777,816) $(13,735,329)

NET INCOME BEFORE DEVELOPER'S INCENTIVE
$ (1,276,955) $ 2,245,744 $ 2,264,455 $ 2,283,272 $ 2,302,196 $ 2,321,229 $ 2,613,294 $ 2,078,934 $ 14,832,171 Developers Incentive

10.00% $ - $ (428,513) $ (428,513) $ (428,513) $ (428,513) $ (428,513) $ (428,513) $ (285,675) $ (2,856,750)

NET INCOME BEFORE DISCOUNTING
$ (1,276,955) $ 1,817,232 $ 1,835,943 $ 1,854,760 $ 1,873,684 $ 1,892,716 $ 2,184,782 $ 1,793,259 $ 11,975,421 Present Value Factors
Discount Rate
Discounted Cash Flow
Net Present Value (Rounded)

5.00% 0.98765 0.97546 0.96342 0.95152 0.93978 0.92817 0.91672 0.90540 $ (1,261,190) $ 1,772,639 $ 1,768,781 $ 1,764,849 $ 1,760,845 $ 1,756,771 $ 2,002,824 $ 1,623,614 $ 11,189,134 $ 11,190,000
per unit: $187,000
$ 11,276,9551 0 2,245,744 $ 2,264,455 $ 2,283,272 5 2,302,196 $ 2,321,229 0 2,613,294 $ 2,078,934 Implied Internal Rate of Return (IRR)

21.900% 0.94809 0.89888 0.85222 0.80798 0.76604 0.72628 0.68858 0.65284 $ 111,190,000) $ (1,210,6711 $ 2,018,651 $ 1,929,813 $ 1,844,844 5 1,763,578 $ 1,685,857 $ 1,799,457 $ 1,357,202 $ (1,269) Altis Beaumont

irr

Land Residual Analysis 63
As a check of reasonableness, we have arrayed a number of recent bulk lot transactions in the subject's market area.

Summary of Comparable Land Sales
Sale Date; Sale Price; Bond Typical Lot
No. Name/Address Status Consideration/Lot Size Number of Lots $/Lot Lot Finishing Costs $/Finished Lot 1 Alessandro Nov -23 $16,143,500 3,000 225 $71,749 $131,516 $203,000 Alessandro Blvd. Closed $4,000
Moreno Valley
Riverside County
Comments: This is a sale of 225 tentatively mapped lots with a typical lot size of 3,000 square feet. The lots will be developed into clusters; however, it is unclear the exact Iayout. The finished lot price is estimated at $201,265 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot. 2 27550 Brodia ea Avenue Jul -23 $2,800,055 3,600 67 $41,792 $137,877 $180,000 27550 Brodia ea Ave. Closed $4,000
Moreno Valley
Riverside County
Comments: This is a sale of 67 tentatively mapped lots with a typical lot size of 3,600 square feet. The finished lot price is estimated at $177,669 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot. 3 Fairway Canyon PA 22B Dec -22 $7,047,000 6,000 55 $128,127 $66,873 $195,000 Sorenstam Dr. Closed $0
Beaumont
Riverside County
Comments: This is a sale of 55 finished lots with a typical lot size of 6,000 square feet within the city of Beaumont. The reported finished lot value is $192,000 per finished lot; however, this does not equate to the purchase price reported on public records. Therefore, this comparable is given guarded reliance. The project is surrounded by open space and a golf course. The building permit is estimated at $3,000 per lot. It is unclear if the project will utilize bond financing. 4 Stratford Place II Nov -22 $7,218,990 6,000 90 $80,211 $149,789 $230,000 Evans Rd. Closed $6,214
Perris
Riverside County
Comments: This is a sale of 90 unimproved lots with a tentative map in place and a typical lot size of 6,000 square feet. According to the broker, the lots were purchased at a finished lot price of $230,000 per I ot. The buyer is developing the 270 lots adjacent to the north of this project. It is assumed there was a degree of assemblage influencing a part of the sale, but this was not confirmed. Special taxes are estimated $3,107 per lot.
5 Canterberry Sep -22 $1,770,000 10,000 19 $93,158 $81,842 $175,000 Mountain Avenue & Red Bluff Ln. Closed $0
Banning
Riverside County
Comments: This comparable represents the sale 19 finished single family lots with a minimum size of 10,000 square feet, fora finished lot price of $175,000/lot. Crestwood Communities is constructing three floor plan ranging in size from 1,951 to 2,300 SF, priced at $579,990 to $591,900. 6 Windsong Aug -22 $7,500,000 5,000 177 $42,373 $197,345 $240,000 NWQ Alessandro Blvd. and Darwin Dr. Closed $4,000
Moreno Valley
Riverside County
Comments: This sale encompasses two adjacent parcels purchased by D.R. Horton from two different sellers. D.R. Horton closed on thefi rst 18.01 -acre parcel for $3,755,000 on August 1, 2022 and closed on the second 17.63 -acre parcel for $3,745,000 on August 2, 2022. The site will be developed into a 177-I of subdivision called Windsong. Floor plans will range from 1,898 to 2,537 square feet and the typical lot size will be approximately 5,000 square feet. Finishing costs are estimated at approximately $197,345 per lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot. 7 La Ventana Apr -22 $8,000,000 6,000 220 $36,364 $178,636 $215,000 SEC Simpson Rd and La Ventana Rd Closed $4,000
Winchester
Riverside County
Comments: Site consists of 220 residential lots, along with a park site and a school site. The typical lot size is approximately 6,000 SF. The finished lot price was reportedly $215,000/Iot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.

Subject
Altis Beaumont
Beaumont, CA
4,775 60
Altis Beaumont

irr

Land Residual Analysis
64 Comparable Land Sales Map
Riverside
91 aodcrest
Mead Valley
Lake Mathews
Moreno I._
Valley e,
Lakeview
Nuevo
Perris
Good Hope
War41 csc riipgs
B
74 Ho fj
and
Sun City
Menifee
Enemy =yu
.... Valley; Reservation
IL
Beaumo Banning
Cabazon
San Bernardino
National Forest
San Jacinto soboea
I.R. -,
Hemet Valle Vista
G2025 Microsoft Co rPorstron C2024 To mTo
Altis Beaumont

irr

Land Residual Analysis
65 t
Sale 1
Alessandro
a _ "15w \_ '
• 7:

Sale 3
Fairway Canyon PA 22B
Sale 5
Canterberry
Sale 2
27550 Brodiaea Avenue
•+r .ac„w.
r =I J
roit
L
Sale 4
Stratford Place II
Sale 6
Windsong
Altis Beaumont

irr.

Land Residual Analysis 66
• 1r t, T
Sale 7
La Ventana
Altis Beaumont

irr

Land Residual Analysis 67
The comparables reflect a range of sale prices of $175,000 to $242,000 per improved lot. The wide disparity in the unadjusted range is largely attributable to location, as well as differences in permits and fees, remaining site costs and bonds encumbrances. The preceding analysis indicates an improved lot value for the subject's representative lot of $187,000, which is supported by the range of sales above and considered reasonable.

The subject includes neighborhoods with a typical lot sizes ranging from 3,850 to 5,775 square feet. In consideration of paired sales analyses and sales agent interviews regarding premiums achieved for home sales when isolating lot size, a lot size adjustment factor of $8.00 per square foot of difference in lot area is applied to the benchmark lot values. In the following table, adjustments for differences in lot size are made to the above -concluded benchmark typical lot and applied to the subject's additional lot size categories.

Lot Size Adjustment
Total No. Typical Lot Lot Size Adjusted Lot Value
PlanningArea of Lots Size(SF) Benchmark Lot Value Adjustment (Rd) PA30 186 3,850 $187,000
PA31 188 4,725 $187,000
PA33 205 5,250 $187,000
PA34 125 5,775 $187,000
($7,000)
$0
$4,200
$8,400
$180,000
$187,000
$191,000
$195,000
The previous analysis indicated values of $177,000 - $192,000 per lot (after accounting for differences in lot size). These figures will be utilized as our conclusions in bulk (no further discounting is warranted).

The preceding improved lot values will be assigned to each partially completed home and vacant lots within CFD No. 2016-3. A deduction of $46,563 will be applied to the finished lots within the CFD without development impact fees paid; additionally, remaining site development costs will also be deducted from each partially completed home and finished lot. As previously discussed, Tri Pointe Homes, is obligated for a proportionate share of City infrastructure improvements encompassing all of the Sundance Specific Plan area, of which the subject property is a part. According to the Developer, there are approximately $5 million dollars in remaining costs benefiting all 4,299 lots/homes within the Sundance Specific Plan. The proportionate share of costs allocable to the Altis at Beaumont project (subject property) is estimated at $819,000 (704 lots/4,299 lots x $5mm). Applied to the 97 finished lots and 40 lots with homes under construction equates to $5,978 per lot ($819,000 / 137 lots), which will be accounted for herein.

Altis Beaumont

irr.

Market Value by Ownership 68
Market Value by Ownership
Introduction
The appraised properties represent 302 lots/homes comprising CFD No. 2016-3. In this section, the previously concluded market values will be allocated to each ownership group comprising the appraised properties in order to provide a market value of the appraised properties by ownership.

The appraised properties consist of 97 improved and partially improved residential lots, 40 homes under construction, and 165 completed homes. The balance of the taxable properties in the CFD include 402 single family homes with a complete assessed value for both land and improvements, which are not appraised herein.

Market values for the floor plans developed within the District are assigned to the 165 completed homes held by individual homeowners and the merchant builder.

In light of the fact the merchant builder has a number of lot(s) that could sell in bulk to one buyer within 12 months, no additional discounting is necessary beyond the market value, in bulk, of the various single-family residential lot categories previously estimated.

Based on the previous analysis, the estimates of market value, by ownership, subject to the impact of the Lien of the Special Tax securing the CFD No. 2016-3 (Altis) Bonds, as of January 17, 2025, are estimated in the following table.

Market Value by Ownership
Lots/Parcels Remaining Site Permits and Value per
/Homes Lot/Home Value Development Costs Fees Component Market Value (Rd.) Individual Homeowners
Completed Homes
Rosa
Li na
Vita
Avi d
Elan
Mira
Total - Individual Homeowners
49 $420,000
25 $484,000
56 $442,000
13 $570,000
4 $493,000
7 $497,000
$o
$0
$0
$0
$0
$0
$420,000 $20,580,000 (Not -Less -Than)
$484,000 $12,100,000 (Not -Less -Than)
$442,000 $24,752,000 (Not -Less -Than)
$570,000 $7,410,000 (Not -Less -Than)
$493,000 $1,972,000 (Not -Less -Than)
$497,000 $3,479,000 (Not -Less -Than)
154 $70,293,000
TriPointe Homes
Finished Lots
PA 31
PA 33
PA 34
Homes Under Construction
Vita
Rosa (PA 33)
Rosa (PA 34)
Li na
Completed Homes
Rosa
Li na
Vita
Avi d
Total - TriPointe Homes
4 $187,000 ($5,978) ($46563) $134,000 $536,000
12 $191,000 ($5,978) ($46,563) $138,000 $1,656,000
81 $195,000 ($5,978) ($46,563) $142,000 $11,502,000
8 $187,000 ($5,978)
2 $191,000 ($5,978)
23 $195,000 ($5,978)
7 $195,000 ($5,978)
3 $420,000 $0
4 $484,000 $0
3 $442,000 $0
1 $570,000 $0
$181,000 $1,448,000
$185,000 $370,000
$189,000 $4,347,000
$189,000 $1,323,000
$420,000 $1,260,000 (Not -Less -Than)
$484,000 $1,936,000 (Not -Less -Than)
$442,000 $1,326,000 (Not -Less -Than)
$570,000 $570,000 (Not -Less -Than)
148 $26,274,000
Aggregate Market Value, subject to a hypothetical condition 302 $96567,000 Altis Beaumont

Final Opinion of Value 69
Final Opinion of Value
Based on the preceding valuation analysis and subject to the definitions, assumptions, and limiting conditions expressed in the report, our opinion of value is as follows:

Value Conclusions
Value Premise
Aggregate Value of Appraised Properties
Aggregate Value of existing Homes based on Assessed Value Total Aggregate Value of Appraised and Assessed Properties in the District No. of Parcels
302
402
704
Aggregate Value
$96,567,000
$180,692,091
$277,259,091
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment -specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser's opinions or conclusions.

None
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.

1. The value derived herein is based on the hypothetical condition that certain proceeds to be financed by the CFD No. 2016-3 Revenue Bonds, Series 2025, will be available to reimburse for certain public infrastructure already completed.

The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.

Exposure Time
Exposure time is the period a property interest would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal. In attempting to estimate a reasonable exposure time for the subject property, we looked at both the historical exposure times of a number of sales, as well as current and past economic conditions. Based on a survey of market participants, a transfer of residential land properties in the region typically occurs within 12 months of exposure. It is estimated the exposure time for the subject property, if appropriately priced, would have been within 12 months of initial exposure. As it relates to the completed home component of the subject, current market conditions indicate that 30 -to -60 -day exposure period is reasonable.

Marketing Period
Marketing time is an estimate of the time to sell a property interest in real estate at the estimated market value during the period immediately after the effective date of value. A reasonable marketing time is estimated by comparing the recent exposure time of similar properties, and then taking into consideration current and future economic conditions and how they may impact marketing of the subject property.

Altis Beaumont

Final Opinion of Value 70
The marketing time for the subject property is not anticipated to vary significantly from the exposure time. Thus, the marketing time is estimated at 12 months or less.

Altis Beaumont

Certification 71
Certification
We certify that, to the best of our knowledge and belief:

1. The statements of fact contained in this report are true and correct.

2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions.

3. We have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.

4. We have previously appraised the property that is the subject of this report. We have provided no other services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment.

S. We have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.

6. Our engagement in this assignment was not contingent upon developing or reporting predetermined results.

7. Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.

8. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice as well as applicable state appraisal regulations.

9. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.

10. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

11. Eric Segal, MAI, and Kevin Ziegenmeyer, MAI, have made a personal inspection of the property that is the subject of this report. Kari Tatton has not personally inspected the subject.

12. No one provided significant real property appraisal assistance to the person(s) signing this certification.

13. We have experience in appraising properties similar to the subject and are in compliance with the Competency Rule of USPAP.

14. As of the date of this report, Eric Segal, MAI, and Kevin Ziegenmeyer, MAI, have completed the continuing education program for Designated Members of the Appraisal Institute.

Altis Beaumont

irr.

Certification 72
Eric Segal, MAI
Certified General Real Estate Appraiser
California Certificate # AG026558
Kari Tatton
Certified General Real Estate Appraiser
California Certificate # 3002218
Altis Beaumont
Kevin Ziegenmeyer, MAI
Certified General Real Estate Appraiser
California Certificate # AG013567

Assumptions and Limiting Conditions 73
Assumptions and Limiting Conditions
This appraisal and any other work product related to this engagement are limited by the following standard assumptions, except as otherwise noted in the report:

1. The title is marketable and free and clear of all liens, encumbrances, encroachments, easements and restrictions. The property is under responsible ownership and competent management and is available for its highest and best use.

2. There are no existing judgments or pending or threatened litigation that could affect the value of the property.

3. There are no hidden or undisclosed conditions of the land or of the improvements that would render the property more or less valuable. Furthermore, there is no asbestos in the property.

4. The revenue stamps placed on any deed referenced herein to indicate the sale price are in correct relation to the actual dollar amount of the transaction.

5. The property is in compliance with all applicable building, environmental, zoning, and other federal, state and local laws, regulations and codes.

6. The information furnished by others is believed to be reliable, but no warranty is given for its accuracy.

This appraisal and any other work product related to this engagement are subject to the following limiting conditions, except as otherwise noted in the report:

1. An appraisal is inherently subjective and represents our opinion as to the value of the property appraised.

2. The conclusions stated in our appraisal apply only as of the effective date of the appraisal, and no representation is made as to the effect of subsequent events.

3. No changes in any federal, state or local laws, regulations or codes (including, without limitation, the Internal Revenue Code) are anticipated.

4. No environmental impact studies were either requested or made in conjunction with this appraisal, and we reserve the right to revise or rescind any of the value opinions based upon any subsequent environmental impact studies. If any environmental impact statement is required by law, the appraisal assumes that such statement will be favorable and will be approved by the appropriate regulatory bodies.

5. Unless otherwise agreed to in writing, we are not required to give testimony, respond to any subpoena or attend any court, governmental or other hearing with reference to the property without compensation relative to such additional employment.

6. We have made no survey of the property and assume no responsibility in connection with such matters. Any sketch or survey of the property included in this report is for illustrative purposes only and should not be considered to be scaled accurately for size. The appraisal Altis Beaumont

irr.

Assumptions and Limiting Conditions 74
covers the property as described in this report, and the areas and dimensions set forth are assumed to be correct.

7. No opinion is expressed as to the value of subsurface oil, gas or mineral rights, if any, and we have assumed that the property is not subject to surface entry for the exploration or removal of such materials, unless otherwise noted in our appraisal.

8. We accept no responsibility for considerations requiring expertise in other fields. Such considerations include, but are not limited to, legal descriptions and other legal matters such as legal title, geologic considerations such as soils and seismic stability; and civil, mechanical, electrical, structural and other engineering and environmental matters. Such considerations may also include determinations of compliance with zoning and other federal, state, and local laws, regulations and codes.

9. The distribution of the total valuation in the report between land and improvements applies only under the reported highest and best use of the property. The allocations of value for land and improvements must not be used in conjunction with any other appraisal and are invalid if so used. The appraisal report shall be considered only in its entirety. No part of the appraisal report shall be utilized separately or out of context.

10. Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraisers, or any reference to the Appraisal Institute) shall be disseminated through advertising media, public relations media, news media or any other means of communication (including without limitation prospectuses, private offering memoranda and other offering material provided to prospective investors) without the prior written consent of the persons signing the report.

11. Information, estimates and opinions contained in the report and obtained from third -party sources are assumed to be reliable and have not been independently verified.

12. Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results.

13. If the property is subject to one or more leases, any estimate of residual value contained in the appraisal may be particularly affected by significant changes in the condition of the economy, of the real estate industry, or of the appraised property at the time these leases expire or otherwise terminate.

14. Unless otherwise stated in the report, no consideration has been given to personal property located on the premises or to the cost of moving or relocating such personal property; only the real property has been considered.

15. The current purchasing power of the dollar is the basis for the values stated in the appraisal; we have assumed that no extreme fluctuations in economic cycles will occur.

16. The values found herein are subject to these and to any other assumptions or conditions set forth in the body of this report but which may have been omitted from this list of Assumptions and Limiting Conditions.

17. The analyses contained in the report necessarily incorporate numerous estimates and assumptions regarding property performance, general and local business and economic Altis Beaumont

irr.

Assumptions and Limiting Conditions 75
conditions, the absence of material changes in the competitive environment and other matters. Some estimates or assumptions, however, inevitably will not materialize, and unanticipated events and circumstances may occur; therefore, actual results achieved during the period covered by our analysis will vary from our estimates, and the variations may be material.

18. The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific survey or analysis of the property to determine whether the physical aspects of the improvements meet the ADA accessibility guidelines. We claim no expertise in ADA issues, and render no opinion regarding compliance of the subject with ADA regulations.

Inasmuch as compliance matches each owner's financial ability with the cost to cure the non- conforming physical characteristics of a property, a specific study of both the owner's financial ability and the cost to cure any deficiencies would be needed for the Department of Justice to determine compliance.

19. The appraisal report is prepared for the exclusive benefit of the Client, its subsidiaries and/or affiliates. It may not be used or relied upon by any other party. All parties who use or rely upon any information in the report without our written consent do so at their own risk.

20. No studies have been provided to us indicating the presence or absence of hazardous materials on the subject property or in the improvements, and our valuation is predicated upon the assumption that the subject property is free and clear of any environment hazards including, without limitation, hazardous wastes, toxic substances and mold. No representations or warranties are made regarding the environmental condition of the subject property. Integra Realty Resources — Los Angeles, Integra Realty Resources, Inc., Integra Strategic Ventures, Inc. and/or any of their respective officers, owners, managers, directors, agents, subcontractors or employees (the "Integra Parties"), shall not be responsible for any such environmental conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because we are not experts in the field of environmental conditions, the appraisal report cannot be considered as an environmental assessment of the subject property.

21. The persons signing the report may have reviewed available flood maps and may have noted in the appraisal report whether the subject property is located in an identified Special Flood Hazard Area. We are not qualified to detect such areas and therefore do not guarantee such determinations. The presence of flood plain areas and/or wetlands may affect the value of the property, and the value conclusion is predicated on the assumption that wetlands are non- existent or minimal.

22. Integra Realty Resources — Los Angeles is not a building or environmental inspector. Integra Los Angeles does not guarantee that the subject property is free of defects or environmental problems. Mold may be present in the subject property and a professional inspection is recommended.

23. The appraisal report and value conclusions for an appraisal assume the satisfactory completion of construction, repairs or alterations in a workmanlike manner.

24. It is expressly acknowledged that in any action which may be brought against any of the Integra Parties, arising out of, relating to, or in any way pertaining to this engagement, the Altis Beaumont

irr.

Assumptions and Limiting Conditions 76
appraisal reports, and/or any other related work product, the Integra Parties shall not be responsible or liable for any incidental or consequential damages or losses, unless the appraisal was fraudulent or prepared with intentional misconduct. It is further acknowledged that the collective liability of the Integra Parties in any such action shall not exceed the fees paid for the preparation of the appraisal report unless the appraisal was fraudulent or prepared with intentional misconduct. Finally, it is acknowledged that the fees charged herein are in reliance upon the foregoing limitations of liability.

25. Integra Realty Resources — Los Angeles, an independently owned and operated company, has prepared the appraisal for the specific intended use stated elsewhere in the report. The use of the appraisal report by anyone other than the Client is prohibited except as otherwise provided. Accordingly, the appraisal report is addressed to and shall be solely for the Client's use and benefit unless we provide our prior written consent. We expressly reserve the unrestricted right to withhold our consent to your disclosure of the appraisal report or any other work product related to the engagement (or any part thereof including, without limitation, conclusions of value and our identity), to any third parties. Stated again for clarification, unless our prior written consent is obtained, no third party may rely on the appraisal report (even if their reliance was foreseeable).

26. The conclusions of this report are estimates based on known current trends and reasonably foreseeable future occurrences. These estimates are based partly on property information, data obtained in public records, interviews, existing trends, buyer -seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable. The Integra Parties are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this assignment. Furthermore, it is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance. While we are of the opinion that our findings are reasonable based on current market conditions, we do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty. Moreover, we assume competent and effective management and marketing for the duration of the projected holding period of this property.

27. All prospective value opinions presented in this report are estimates and forecasts which are prospective in nature and are subject to considerable risk and uncertainty. In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of our estimates such as, but not limited to changes in the economy, interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc. It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future.

28. The appraisal is also subject to the following:

Altis Beaumont

irr.

Assumptions and Limiting Conditions 77
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment -specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser's opinions or conclusions.

None
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.

1. The value derived herein is based on the hypothetical condition that certain proceeds to be financed by the CFD No. 2016-3 Revenue Bonds, Series 2025, will be available to reimburse for certain public infrastructure already completed.

The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.

Altis Beaumont

Addenda
Addendum A
Appraiser Qualifications
Altis Beaumont

Eric Segal, MAI
Experience
Mr. Segal is a Certified General real estate appraiser and holds the Appraisal Institute's MAI designation. In 1998, Mr. Segal began his career in real estate as a research analyst/appraiser trainee for Richard Seevers and Associates. By 1999, he began writing narrative appraisal reports covering a variety of commercial properties, with an emphasis on residential master planned communities and subdivisions. Today, Mr. Segal is a partner in the firm and is involved in appraisal assignments covering a wide variety of properties including office, retail, industrial, multifamily housing, master planned communities, and specializes in the appraisal of Mello Roos Community Facilities Districts and Assessment Districts for land secured municipal financings, as well as multifamily developments under the U.S. Department of Housing and Urban Development's Multifamily Accelerated Processing (MAP) Guide. He has developed the experience and background necessary to deal with complex assignments covering an array of property types, with a particular focus on urban redevelopment in the cities of San Francisco, Oakland, Monterey, Alameda and San Mateo. He has developed the experience and background necessary to deal with complex assignments covering an array of property types.

Eric is currently Senior Managing Director of the Integra Los Angeles office, and Managing Director of the Integra Orange County, Integra -San Francisco and Integra -Sacramento offices.

Professional Activities & Affiliations
MAI Designation, Appraisal Institute Appraisal Institute, January 2016 Licenses
California, Certified General Real Estate Appraiser, AG026558, Expires February 2027 Nevada, Certified General, A.0207666 -CG, Expires January 2027 Arizona, Certified General, CGA - 1006422, Expires January 2026 Washington, Certified General, 20100611, Expires June 2025 Education
Academic:

Bachelor of Science in Business Administration (Concentrations in Finance and Real Estate & Land Use Affairs), California State University, Sacramento
Appraisal and Real Estate Courses:

Uniform Appraisal Standards for Federal Land Acquisitions (Yellow Book) Uniform Standards of Professional Appraisal Practice
Appraisal Principles
Basic Income Capitalization
Highest & Best Use and Market Analysis
Advanced Income Capitalization
Report Writing and Valuation Analysis
Self Storage Economics and Appraisal Seminar
Appraisal Litigation Practice and Courtroom Management
Hotel Valuations: New Techniques for today's Uncertain Times Computer Enhanced Cash Flow Modeling
Advanced Sales Comparison & Cost Approaches
[email protected] - 916.435.3883 x228
Integra Realty Resources - Los
Angeles (219)
12100 Wilshire Blvd
Suite 800
Los Angeles, CA 90025
T 916.435.3883
F 916.435.4774
irr.com
irr®

Eric Segal, MAI
Education (Cont'd)
Advanced Applications
Subdivision Valuation
Appraisal of Self -Storage Facilities
Appraisal of Fast Food Facilities
Appraisal of Limited Service Hotels
How Tenants Create or Destroy Value: Leasehold Valuation and its Impact on Value Appraisal of Manufactured Homes Featuring Next Generation Manufactured Homes Appraisal and Real Estate Courses (cont'd):

Business Practices and Ethics
IRS Valuation Update
[email protected] - 916.435.3883 x228
Integra Realty Resources - Los
Angeles (219)
12100 Wilshire Blvd
Suite 800
Los Angeles, CA 90025
T 916.435.3883
F 916.435.4774
irr.com
r irr®

Business, Consumer Services & Housing Agency

BUREAU OF REAL ESTATE APPRAISERS

REAL ESTATE APPRAISER LICENSE
i
�J �� ", ° .' d7 dd on ;gs a ''
�h
has successfully met the', ].te ient3 for a I]Cet,se as a residential and commercial real eta `. apprAiser 111 the ,• tile: '`1 r' .- a f
''.State of California � i� b�eifore, tit�c�c� to �
',TI lie;enge= a :bee .:js e. .. iy c d tice it i..the pro ri on;. of the st4tc Appr � s`.Li'consin ".l %,Cert:fi tion v. - a c
BREA A P.PRAl ER. F -r 'l l l; [CATON NUMBER:. AG: i 5 8 Effective Date: February 19, 2025
Date 'Expire : February 18;2027
Angela Jem of Bureau Chief, BRI A
i tFrr4i�\�.

Kevin Ziegenmeyer, MAI
Experience
Mr. Ziegenmeyer is a Certified General real estate appraiser and holds the Appraisal Institute's MAI designation. In 1989, Mr. Ziegenmeyer began his career in real estate as a controller for a commercial and residential real estate development corporation. In 1991 he began appraising and continued to be involved in appraisal assignments covering a wide variety of properties, including office, retail, industrial, residential income and subdivisions throughout the state of California, and Northern Nevada. Mr. Ziegenmeyer handles many of the firm's master -planned property appraisals and over the past two decades has developed expertise in the valuation of Community Facilities Districts and Assessment Districts.ln fact, Mr. Ziegenmeyer was one of five appraisers to collaborate with other professionals in developing the appraisal guidelines for the California Debt and Investment Advisory Commission (Recommended Practices in the Appraisal of Real Estate for Land -Secured Financing - 2004). He has developed the experience and background necessary to deal with complex assignments covering an array of property types, with a particular focus on urban redevelopment in the cities and counties of San Francisco, Dublin, Monterey, Newport Beach, Alameda, Napa and San Mateo. In early 2015, Mr. Ziegenmeyer obtained the Appraisal Institute's MAI designation. Kevin is currently Senior Managing Director of the Integra -San Francisco office and Managing Director of the Integra -Sacramento office.

Licenses
California, California Certified General Real Estate Appraiser, AG013567, Expires June 2025
Education
Academic:

Bachelor of Science in Accounting, Azusa Pacific University, California Appraisal and Real Estate Courses:

Standards of Professional Practice, Parts A, B & C
Basic Valuation Procedures
Real Estate Appraisal Principles
Capitalization Theory and Techniques, Part A
Advanced Income Capitalization
Report Writing and Valuation Analysis
Advanced Applications
IRS Valuation Summit I & II
2008, 2009, 2010 & 2011 Economic Forecast
Business Practices and Ethics
Contemporary Appraisal Issues with Small Business Administration Financing General Demonstration Appraisal Report Writing Seminar
7 -Hour National USPAP Update Course
Valuation of Easements and Other Partial Interests
2009 Summer Conference
Uniform Appraisal Standards for Federal Land Acquisitions (Yellowbook) 2008 Economic Update
Valuation of Conservation Easements
Subdivision Valuation
2005 Annual Fall Conference
[email protected] - 916.435.3883 x224
Integra Realty Resources -
Sacramento
590 Menlo Drive
Suite 1
Rocklin, CA 95765
T 916.435.3883
F 916.435.4774
irr.com
Page334of789

Kevin Ziegenmeyer, MAI
Education (Cont'd)
General Comprehensive Exam Module I, II, Ill & IV
Advanced Income Capitalization
Advanced Sales Comparison & Cost Approaches
2004 Central CA Market Update
Computer -Enhanced Cash Flow Modeling
Forecast 2000, 2001, 2002, 2003 & 2004
Land Valuation Assignments
Land Valuation Adjustment Procedures
Highest & Best Use and Market Analysis
Entitlements, Land Subdivision & Valuation
Real Estate Value Cycles
El Dorado Hills Housing Symposium
Federal Land Exchanges
M & S Computer Cost -Estimating, Nonresidential
[email protected] - 916.435.3883 x224
Integra Realty Resources -
Sacramento
590 Menlo Drive
Suite 1
Rocklin, CA 95765
T 916.435.3883
F 916.435.4774
i rr. com

Business, Consumer Services & Housing Agency

BUREAU OF REAL ESTATE APPRAISERS

REAL ESTATE APPRAISER LICENSE
has successfully met the requirements for a license as a residential and commercial real estate appraiser in the State of California and is, therefore, entitled to use the title:
"Certified General Real Estate Appraiser"
in accordance with the provisions of the Real Estate Appraisers BREA APPRAISER IDENTIFICATION N iMBER:'` AG 013567
Effective Date June 5, 2023
Date Expires: June 4, 2025
Angela Je o , Bureau Chief, BREA
3070756

Kari Tatton
Experience
Ms. Tatton is a Certified General real estate appraiser. After completing her bachelor's degree at California State University, Sacramento, Ms. Tatton began her career in real estate in March 2011, and has been writing narrative appraisal reports for a variety of commercial properties including office, retail, industrial, multifamily housing, land and special-purpose properties including self -storage facilities, religious facilities, schools and auto dealerships. She specializes in the appraisal of residential master planned communities and subdivisions, as well as Mello -Roos and Assessment Districts for land -secured municipal financings.

Licenses
California, California Certified General Real Estate Appraiser, 3002218, Expires June 2026 Education
Academic:

Bachelor of Arts in Interior Design (Concentration in Interior Architecture) California State University, Sacramento
Appraisal and Real Estate Courses:

Basic Appraisal Principles
Basic Appraisal Procedures
Site Valuation & Cost Approach
General Market Analysis & Highest and Best Use
Sales Comparison Approach
Income Capitalization Approach Part I
Income Capitalization Approach Part II
General Appraiser Report Writing and Case Studies
Appraisal of Fast Food Facilities
Appraising Small Apartment Properties
Appraisal of Land Subject to Ground Leases
Appraising Automobile Dealerships
[email protected] - 916.435.3883 x229
Integra Realty
Resources - Sacramento
590 Menlo Drive
Suite 1
Rocklin, CA 95765
T 916.435.3883
F 916.435.4774
irr.com
r irr®

Business, Consumer Services & Housi ng Agency

BU REAU OF REAL ESTATE APPRAISERS

REAL ESTATE APPRAISER LICENSE
Kari M. Tatton
has successfully met the requirement for a license as a reside ntial a nd commercial real estate appraiser in State of California and is, there fo re, entitled to use the title:
"Certified General Real Estate Appraiser"
This licen se has been issu ed in accordan ce with the prov isions of the Real Estate Appraisers' Licensing an Certification Law.

BREA APPRAISER IDEN TIFICATION NUMBER: 3 002218
Effective Date:

D ate Expires:

Angela Jem
3076341
June 2, 2024
June 1, 2026
Bureau Chief, BREA

About IRR
Integra Realty Resources, Inc. (IRR) provides world -class commercial real estate valuation, counseling, and advisory services. Routinely ranked among leading property valuation and consulting firms, we are now the largest independent firm in our industry in the United States, with local offices coast to coast and in the Caribbean.

IRR offices are led by MAI-designated Senior Managing Directors, industry leaders who have over 25 years, on average, of commercial real estate experience in their local markets. This experience, coupled with our understanding of how national trends affect the local markets, empowers our clients with the unique knowledge, access, and historical perspective they need to make the most informed decisions.

Many of the nation's top financial institutions, developers, corporations, law firms, and government agencies rely on our professional real estate opinions to best understand the value, use, and feasibility of real estate in their market.

Local Expertise...Nationally!
irr.com

Addenda
Addendum B
Definitions
Altis Beaumont

Addenda
Definitions
The source of the following definitions is the Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago: Appraisal Institute, 2015), unless otherwise noted.

As Is Market Value
The estimate of the market value of real property in its current physical condition, use, and zoning as of the appraisal date.

Disposition Value
The most probable price that a specified interest in property should bring under the following conditions:

1. Consummation of a sale within a specified time, which is shorter than the typical exposure time for such a property in that market.

2. The property is subjected to market conditions prevailing as of the date of valuation.

3. Both the buyer and seller are acting prudently and knowledgeably.

4. The seller is under compulsion to sell.

5. The buyer is typically motivated.

6. Both parties are acting in what they consider to be their best interests.

7. An adequate marketing effort will be made during the exposure time.

8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements comparable thereto.

9. The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.

This definition can also be modified to provide for valuation with specified financing terms.

Effective Date

1. The date on which the appraisal or review opinion applies.

2. In a lease document, the date upon which the lease goes into effect.

Entitlement
In the context of ownership, use, or development of real estate, governmental approval for annexation, zoning, utility extensions, number of lots, total floor area, construction permits, and occupancy or use permits.

Entrepreneurial Profit

1. A market -derived figure that represents the amount an entrepreneur receives for his or her contribution to a project and risk; the difference between the total cost of a property (cost of Altis Beaumont

irr.

Addenda
development) and its market value (property value after completion), which represents the entrepreneur's compensation for the risk and expertise associated with development. An entrepreneur is motivated by the prospect of future value enhancement (i.e., the entrepreneurial incentive). An entrepreneur who successfully creates value through new development, expansion, renovation, or an innovative change of use is rewarded by entrepreneurial profit. Entrepreneurs may also fail and suffer losses.

2. In economics, the actual return on successful management practices, often identified with coordination, the fourth factor of production following land, labor, and capital; also called entrepreneurial return or entrepreneurial reward.

Exposure Time

1. The time a property remains on the market.

2. The estimated length of time that the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal; a retrospective opinion based on an analysis of past events assuming a competitive and open market.

Fee Simple Estate
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.

Floor Area Ratio (FAR)
The relationship between the above -ground floor area of a building, as described by the zoning or building code, and the area of the plot on which it stands; in planning and zoning, often expressed as a decimal, e.g., a ratio of 2.0 indicates that the permissible floor area of a building is twice the total land area.

Highest and Best Use

1. The reasonably probable use of property that results in the highest value. The four criteria that the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity.

2. The use of an asset that maximizes its potential and that is possible, legally permissible, and financially feasible. The highest and best use may be for continuation of an asset's existing use or for some alternative use. This is determined by the use that a market participant would have in mind for the asset when formulating the price that it would be willing to bid. (ISV)

3. [The] highest and most profitable use for which the property is adaptable and needed or likely to be needed in the reasonably near future. (Uniform Appraisal Standards for Federal Land Acquisitions)
Altis Beaumont

irr.

Addenda
Investment Value

1. The value of a property to a particular investor or class of investors based on the investor's specific requirements. Investment value may be different from market value because it depends on a set of investment criteria that are not necessarily typical of the market.

2. The value of an asset to the owner or a prospective owner for individual investment or operational objectives.

Lease
A contract in which rights to use and occupy land, space, or structures are transferred by the owner to another for a specified period of time in return for a specified rent.

Leased Fee Interest
The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires.

Leasehold Interest
The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease.

Liquidation Value
The most probable price that a specified interest in real property should bring under the following conditions:

1. Consummation of a sale within a short time period.

2. The property is subjected to market conditions prevailing as of the date of valuation.

3. Both the buyer and seller are acting prudently and knowledgeably.

4. The seller is under extreme compulsion to sell.

5. The buyer is typically motivated.

6. Both parties are acting in what they consider to be their best interests.

7. A normal marketing effort is not possible due to the brief exposure time.

8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements comparable thereto.

9. The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.

This definition can also be modified to provide for valuation with specified financing terms.

Marketing Time
An opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of an appraisal.

Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal.

Altis Beaumont

Addenda
Market Value
The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
• buyer and seller are typically motivated;
• both parties are well informed or well advised, and acting in what they consider their own best interests;
• a reasonable time is allowed for exposure in the open market; • payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
• the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. (Source: Code of Federal Regulations, Title 12, Chapter I, Part 34.42[g]; also Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472) Prospective Opinion of Value
A value opinion effective as of a specified future date. The term does not define a type of value.

Instead, it identifies a value opinion as being effective at some specific future date. An opinion of value as of a prospective date is frequently sought in connection with projects that are proposed, under construction, or under conversion to a new use, or those that have not yet achieved sellout or a stabilized level of long-term occupancy.

Altis Beaumont

irr.

Addenda
Addendum C
Value by APN
Altis Beaumont

Addenda
Addendum D
Comparable Data
Altis Beaumont

Addenda
Land Sales
Altis Beaumont

Land Sale Profile
Sale No. 1
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
Alessandro
Residential, Single Family
Development Land
Alessandro Blvd.

Moreno Valley, CA 92555
Riverside
Suburban
3246636
Sale Price:

Effective Sale Price:

Sale Date:

Recording Date:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Assets Sold:

Property Rights:
of Interest Conveyed:

Financing:

Conditions of Sale:

Document Type:

Recording No.:

Sale Analysis
$16,143,500
$16,143,500
11/30/2023
12/04/2023
Closed
$873,566
$20.05
$5,381.17
$71,749 /Unit
Gpalessandro LLC
Taylor Morrison Of California
Real estate only
Fee Simple
100.00
Cash to seller
Arm's -length
Deed
2023.359986
Expenditures After Purchase: $131,516
Expenditures Description:

Other Adjustment:

Alessandro
Site development and
building permit
$2,000
Estimated bond
encumbrance
Adjustment Comments:

Improvement and Site Data
Legal/Tax/Parcel ID:

Acres(Gross):

Land-SF(Gross):

Potential Building SF:

No. of Units (Potential):

Zoning Code:

Zoning Desc.:

Source of Land Info.:

Comments
487-470-022

18.48 804,989
3,000
225
DC
Downtown Center
Public Records
This is a sale of 225 tentatively mapped lots with a typical lot size of 3,000 square feet. The lots will be developed into clusters; however, it is unclear the exact layout. The finished lot price is estimated at $201,265 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding
projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot.

Land Sale Profile
Sale No. 2
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
27550 Brodiaea Avenue
Residential, Single Family
Development Land
27550 Brodiaea Ave.

Moreno Valley, CA 92555
Riverside
Suburban
3246647
Sale Price:

Effective Sale Price:

Sale Date:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Assets Sold:

Property Rights:
of Interest Conveyed:

Financing:

Conditions of Sale:

Document Type:

Sale Analysis
$2,800,055
$2,800,055
07/01/2023
Closed
$319,277
$7.33
$777.79
$41,792 /Unit
Discovery Christian Church
Moreno Valley
DR Horton Los Angeles
Holding
Real estate only
Fee Simple
100.00
Cash to seller
Arm's -length
Deed
Estimated bond
encumbrance
Adjustment Comments:

Improvement and Site Data
Legal/Tax/Parcel ID:

Acres(Gross):

Land-SF(Gross):

Potential Building SF:

No. of Units (Potential):

Zoning Code:

Of Zoning Desc.:

Source of Land Info.:

Expenditures After Purchase: $137,877
Expenditures Description:

Other Adjustment:
27550 Brodiaea Avenue
Site development and
building permit
$2,000
Comments
486-240-010

8.77 382,021
3,600
67 R5
Suburban Residential
Public Records
This is a sale of 67 tentatively mapped lots with a typical lot size of 3,600 square feet. The finished lot price is estimated at $177,669 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing.

However, given the surrounding projects also utilize bond financing, it is estimated the property would have an
estimated special tax of $2,000 per lot.

L.7.1

Land Sale Profile
Sale No. 3
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
Fairway Canyon PA 22B
Residential, Single Family
Development Land
Sorenstam Dr.

Beaumont, CA 92223
Riverside
Suburban
2998964
Sale Price:

Effective Sale Price:

Sale Date:

Recording Date:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Assets Sold:

Property Rights:
of Interest Conveyed:

Financing:

Conditions of Sale:

Document Type:

Recording No.:

Sale Analysis
$7,047,000
$7,047,000
12/21/2022
12/28/2022
Closed
$64,439
$1.48
$1,174.50
$128,127 /Unit
Meritage Homes Of California
Inc
DR Horton Los Angeles
Holding Company Inc
Real estate only
Fee Simple
100.00
Cash to seller
Arm's -length
Deed
2022.514695
Fairway Canyon PA 22B
• n
Expenditures After Purchase: $66,873
Expenditures Description:

Site development and
permits and fees
Improvement and Site Data
Legal/Tax/Parcel ID:

Acres(Gross):

Land-SF(Gross):

Potential Building SF:

No. of Units (Potential):

Zoning Code:

Zoning Desc.:

Source of Land Info.:

Comments
413-790-057
109.36
4,763,722
6,000
55 SP
Specific Plan
Public Records
This is a sale of 55 finished lots with a typical lot size of 6,000 square feet within the city of Beaumont. The reported finished lot value is $192,000 per finished lot; however, this does not equate to the purchase price reported on public records.

Therefore, this comparable is given guarded reliance. The project is surrounded by open space and a golf course. The building permit is estimated at $3,000 per lot. It is unclear if the project will utilize bond financing.

Land Sale Profile Sale No. 4
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
Stratford Place II
Residential, Single Family
Development Land
Evans Rd.

Perris, CA 92571
Riverside
Suburban
3014316
Sale Price:

Effective Sale Price:

Sale Date:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Assets Sold:

Property Rights:
of Interest Conveyed:

Financing:

Conditions of Sale:

Document Type:

Recording No.:

Sale Analysis
$7,218,990
$7,218,990
11/01/2022
Closed
$306,149
$7.03
$1,203.16
$80,211 /Unit
Stratford Ranch Investors LLC
Pulte Home Company LLC
Real estate only
Fee Simple
100.00
Cash to seller
Arm's -length
Deed
2022.451354
Expenditures After Purchase: $149,789
Stratford Place II
ill
i
•
�-�••y-r...�«ter+ i
.
•
•
Expenditures Description:

Other Adjustment:

Adjustment Comments:

Site Improvements and
permits and fees
$3,107
Bond Encumbrance
Improvement and Site Data
Legal/Tax/Parcel ID:

Acres(Gross):

Land-SF(Gross):

Potential Building SF:

No. of Units (Potential):

Zoning Code:

Source of Land Info.:

Comments
302-150-049

23.58 1,027,145
6,000
90 R-6,000
Public Records
This is a sale of 90 unimproved lots with a tentative map in place and a typical lot size of 6,000 square feet. According to the broker, the lots were purchased at a finished lot price of $230,000 per lot. The buyer is developing the 270 lots
adjacent to the north of this project. It is assumed there was a degree of assemblage influencing a part of the sale, but this was not confirmed. Special taxes are estimated $3,107 per lot.

Land Sale Profile
Sale No. 5
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
Canterberry
Residential, Finished SFR Lots
Mountain Avenue & Red Bluff
Ln.

Banning, CA 92220
Riverside
Suburban
3052090
Sale Price:

Effective Sale Price:

Sale Date:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Assets Sold:

Property Rights:
of Interest Conveyed:

Financing:

Conditions of Sale:

Document Type:

Sale Analysis
$1,770,000
$1,770,000
09/30/2022
Closed
$405,963
$9.32
$177.00
$93,158 /Approved Lot
George A Nordquist And Dora
J Nordquist Revocable Trust
Canterbury At Banning LLC
Real estate only
Fee Simple
100.00
Cash to seller
Arm's -length
Deed
Expenditures After Purchase: $81,842
Canterberry
Expenditures Description:

Sale Price Includes FF&E?
Lot finishing costs
No
Improvement and Site Data
Legal/Tax/Parcel ID:

Acres(Gross):

Land-SF(Gross):

Potential Building SF:

No. of Units (Potential):

Source of Land Info.:

Comments
535-423-001 thru -009;
535-422-005 thru -014

4.36 189,922
10,000
19 Public Records
This comparable represents the sale 19 finished single family lots with a minimum size of 10,000 square feet, for a finished lot price of $175,000/lot. Crestwood Communities is
constructing three floor plan ranging in size from 1,951 to 2,300 SF, priced at $579,990 to $591,900.

Land Sale Profile
Sale No. 6
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
Windsong
Residential, Single Family
Development Land
NWQAlessandro Blvd. and
Darwin Dr.

Moreno Valley, CA 92555
Riverside
Suburban
3022274
Sale Price:

Effective Sale Price:

Sale Date:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Acre(Usable):
$/Land SF(Usable):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Property Rights:
of Interest Conveyed:

Financing:

Document Type:

Recording No.:

Sale Analysis
$7,500,000
$7,500,000
08/01/2022
Closed
$210,438
$4.83
$210,438
$4.83
$1,500.00
$42,373 /Approved Lot
Winco Holdings, Inc &
Equitable Moreno Valley II
Partnership
D.R. Horton
Fee Simple
100.00
Cash to seller
Deed
2022.0341934 &
2022.0340965
Windsong
Expenditures After Purchase: $197,345
Expenditures Description:

Other Adjustment:

Adjustment Comments:

Lot finishing costs
$2,000
Estimated bond
encumbrance
Improvement and Site Data
Legal/Tax/Parcel ID:

Acres(Usable/Gross):

Land-SF(Usable/Gross):

Usable/Gross Ratio:

Potential Building SF:

No. of Units (Potential):

Corner Lot:

Utilities:

Source of Land Info.:

Comments
487,470-025 (ptn),
487-470-028, 487-574-001 &
002

35.64/35.64
1,552,478/1,552,478

1.00 5,000
177
Yes
Electricity, Water Public,
Sewer, Gas, Telephone
Public Records
This sale encompasses two adjacent parcels purchased by D.R.

Horton from two different sellers. D.R. Horton closed on the first 18.01 -acre parcel for $3,755,000 on August 1, 2022 and closed on the second 17.63 -acre parcel for $3,745,000 on August 2, 2022. The site will be developed into a 177 -lot subdivision called Windsong. Floor plans will

Land Sale Profile Sale No. 6
Comments (Cont'd)
range from 1,898 to 2,537 square feet and the typical lot size will be approximately 5,000 square feet. Finishing costs are estimated at approximately $197,345 per lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.

Windsong

Land Sale Profile
Sale No. 7
Location & Property Identification
Property Name:

Sub -Property Type:

Address:

City/State/Zip:

County:

Market Orientation:

IRR Event ID:

Sale Information
La Ventana
Residential, Single Family
Development Land
SEC Simpson Rd and La
Ventana Rd
Winchester, CA 92584
Riverside
Suburban
3027571
Sale Price:

Effective Sale Price:

Sale Date:

Recording Date:

Listing Price:

Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):

Grantor/Seller:

Grantee/Buyer:

Assets Sold:

Property Rights:
of Interest Conveyed:

Exposure Time:

Financing:

Conditions of Sale:

Document Type:

Recording No.:

Sale Analysis
$8,000,000
$8,000,000
04/15/2022
04/15/2022
$8,000,000
Closed
$103,896
$2.39
$1,333.33
$36,364 /Approved Lot
La Ventana 242, LLC
Forestar / DR Horton
Real estate only
Fee Simple
100.00
39 (months)
Cash to seller
Arm's -length
Deed
0180333
La Ventana
I 1
. .
€. •
•r.0.• •a•
Il

11. 1'.
l} M
i lir, 5
•
Expenditures After Purchase:

Expenditures Description:

Other Adjustment:

Adjustment Comments:
$178,636
Lot finishing costs
$2,000
Estimated bond
encumbrance
Improvement and Site Data
MSA:

Legal/Tax/Parcel ID:

Acres(Gross):

Land-SF(Gross):

Potential Building SF:

No. of Units (Potential):

Zoning Code:

Zoning Desc.:

Riverside -San
Bernardino -Ontario, CA
Metropolitan Statistical Area
APNs: 461-450-001
through -013, -451-001
through -048, -452-001
through -019, -460-001
through -020, -461-001
though -021, -470-001
through -027, -470-001
through -064, -472-001
through -010, -480-001
through -005, -481-001
through -003, -482-001

77.00 3,354,120
6,000
220
SP
Specific Plan

Land Sale Profile Sale No. 7
Improvement and Site Data (Cont'd)
Flood Plain:

Source of Land Info.:

Comments
No
Broker
Site consists of 220 residential lots, along with a park site and a school site. The typical lot size is approximately 6,000 SF.

The finished lot price was reportedly $215,000/lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.

La Ventana

RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

BEAUMONT, AUTHORIZING THE EXECUTION AND

DELIVERY OF A FIRST AMENDMENT TO ACQUISITION

AGREEMENT RELATING TO CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE)

AND TAKING CERTAIN OTHER ACTIONS IN CONNECTION

THEREWITH
WHEREAS, the City Council (the "City Council") of the City of Beaumont, California (the "City"), located in Riverside County, California, has heretofore undertaken proceedings and declared the necessity to issue bonds by the City of Beaumont Community Facilities District 2016-3 (Sundance) (the "District") pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the "Act"); and WHEREAS, pursuant to resolutions adopted by the City Council on February 7, 2017 and the Act, the City formed the District; and
WHEREAS, certain facilities (the "Facilities") are eligible to be financed from a special tax for facilities levied within the District; and
WHEREAS, the City previously entered into an Acquisition Agreement (the "Original Agreement") with the District and Tri Pointe Homes IE-SD, Inc. for the purpose of financing certain of the Facilities; and
WHEREAS, the City now desires to approve the form of a First Amendment to Acquisition Agreement (the "First Amendment to Acquisition Agreement"), by and among the City, the District and Tri Pointe Homes IE-SD, Inc., for the purpose of financing additional Facilities beyond those contemplated in the Original Agreement; and NOW, THEREFORE, the City Council of the City of Beaumont does hereby resolve as follows:

SECTION 1. Each of the above recitals is true and correct, as is each of the findings and determinations set forth therein, and each of said recitals, findings and determinations is adopted by the City Council.

SECTION 2. The form of the First Amendment to Acquisition Agreement presented at this meeting is hereby approved; and any one of the Mayor, the City Manager or the Finance Director of the City or the written designee of one of the foregoing (collectively, the "Authorized Officers") is hereby authorized and directed to execute the First Amendment to Acquisition Agreement in the form hereby approved, with such additions therein and changes thereto as the Authorized Officer or Authorized Officers executing the same deem necessary to cure any defect or ambiguity therein if such change does not materially alter the substance or content thereof, with such approval to be conclusively evidenced by the execution and delivery of such First Amendment to Acquisition Agreement.
1 4907-1243-5747v3/022599-0037

SECTION 3. Each of the Authorized Officers and the other officers and staff of the City of Beaumont responsible for the fiscal affairs of the City are hereby authorized and directed to take any actions and to execute and deliver any and all documents as are necessary to accomplish the execution and delivery of the First Amendment to Acquisition Agreement and the issuance, sale and delivery of the "City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds" in accordance with the provisions of this Resolution and the fulfillment of the purposes of the Bonds as described in the Bond Indenture, as supplemented, relating to such bonds. Any document authorized herein to be signed by the City Clerk may be signed by a duly -appointed deputy city clerk or assistant city clerk.

PASSED AND ADOPTED by the City Council of the City of Beaumont, California, this day of , 2025, by the following vote:

AYES:

NAYS:

ABSENT:

ABSTAIN:

MAYOR OF THE CITY OF BEAUMONT
ATTEST:

CITY CLERK
2 4907-1243-5747v3/022599-0037

RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

BEAUMONT, ACTING AS THE LEGISLATIVE BODY OF THE

CITY OF BEAUMONT COMMUNITY FACILITIES DISTRICT
NO. 2016-3 (SUNDANCE) AUTHORIZING THE ISSUANCE OF
ITS 2025 SPECIAL TAX BONDS IN A PRINCIPAL AMOUNT

NOT TO EXCEED SEVEN MILLION FIVE HUNDRED
THOUSAND DOLLARS ($7,500,000), AND APPROVING

CERTAIN DOCUMENTS AND TAKING CERTAIN OTHER

ACTIONS IN CONNECTION THEREWITH
WHEREAS, the City Council (the "City Council") of the City of Beaumont (the "City"), has heretofore undertaken proceedings to establish the City of Beaumont Community Facilities District No. 2016-3 (Sundance) (the "District") and declared the necessity to issue bonds on behalf of the District pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the "Act"); and
WHEREAS, pursuant to 2017-05, 2017-06 and 2017-07 adopted by the City Council on February 7, 2017, certain bond propositions were submitted to the qualified electors within the District, and were approved by more than two-thirds of the votes cast at the election held on February 7, 2017; and WHEREAS, the District has previously issued its $8,800,000 2023 Special Tax Bonds, (the "2023 Bonds") to finance certain public facilities which the District was authorized to finance (the "Facilities"); and
WHEREAS, the 2023 Bonds were issued pursuant to a Bond Indenture dated as of May 1, 2023 (the "2023 Indenture"), by and between the District and Zions Bancorporation, National Association, as successor trustee (the "Trustee"); and
WHEREAS, the legislative body of the District now desires to finance certain additional Facilities through the issuance of bonds in an aggregate principal amount not to exceed $7,500,000 designated as the "City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds" (the "2025 Bonds"); and
WHEREAS, in order to effect the issuance of the 2025 Bonds, the District desires to enter into various agreements and approve certain documents in substantially the forms presented herein; and WHEREAS, based on the appraisal of real property prepared by Integra Realty Resources (the "Appraisal") of property within the District, the value of the real property in the District subject to the special tax to pay debt service on the 2025 Bonds is more than three times the sum of the principal amount of the 2025 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within the District (including the 2023 Bonds), all as calculated in the manner set forth in Section 53345.8(a) of the Act; and WHEREAS, the City Council has determined in accordance with Section 53360.4 of the Act that a negotiated sale of the 2025 Bonds to Stifel, Nicolaus & Company, Incorporated (the "Underwriter") in accordance with the terms of the Bond Purchase Agreement for the 2025 Bonds to be entered into by the 4913-1818-5239v3/022599-0037

District and the Underwriter (the "Bond Purchase Agreement") approved as to form by this City Council herein will result in a lower overall cost to the District than a public sale; and WHEREAS, the City and the District previously entered into an Acquisition Agreement (the "Original Acquisition Agreement"), dated as of May 1, 2023, with Tri Pointe Homes IE-SD, Inc., for the purpose of, among other things, setting forth the specific facilities to be financed with bond proceeds of the District; and
WHEREAS, the City and the District desire to amend the Original Acquisition Agreement pursuant to an Amendment No. 1 to Acquisition Agreement (the "Amendment No. 1 to Acquisition Agreement") with Tri Pointe Homes IE-SD, Inc., to allow for the financing of additional facilities beyond those identified in the Original Acquisition Agreement; NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Beaumont, California, acting as the legislative body of the City of Beaumont Community Facilities District No. 2016-3 (Sundance):

SECTION 1. Each of the above recitals is true and correct.

SECTION 2. The issuance of the 2025 Bonds is hereby authorized in an aggregate principal amount not to exceed $7,500,000, with the exact principal amount to be determined by the official signing the Bond Purchase Agreement in accordance with Section 5 below. The City Council hereby determines that it is prudent in the management of the District's fiscal affairs to issue the 2025 Bonds. The 2025 Bonds shall mature on the dates and pay interest at the rates set forth in the Bond Purchase Agreement to be executed on behalf of the District in accordance with Section 5 hereof. All other provisions of the 2025 Bonds shall be governed by the terms and conditions of the 2023 Indenture, as supplemented and amended by the First Supplement to Bond Indenture (the "First Supplement" and together with the 2023 Indenture, the "Indenture"), which First Supplement is hereby approved in substantially the form on file with the City Clerk, with such additions thereto and changes therein (including, but not limited to, changes in the amount to be maintained in the Reserve Account (as defined in the Indenture)) as the officer or officers executing the same deem necessary to enhance the security for the 2025 Bonds, to cure any ambiguity or defect therein, to insert the offering price(s), interest rate(s), selling compensation, principal amount per maturity, redemption dates and prices and such other related terms and provisions as limited by Section 5 hereof or to conform any provisions therein to the Bond Purchase Agreement or the Official Statement delivered to the Underwriter of the 2025 Bonds. Approval of such changes shall be conclusively evidenced by the execution and delivery of the Indenture by one of the following: the Mayor, the City Manager, the Finance Director or their written designees (each, an "Authorized Officer" and collectively, the "Authorized Officers"), each of whom is authorized to execute the Indenture.

Capitalized terms used in this Resolution which are not defined herein have the meanings ascribed to them in the Indenture.

SECTION 3. The 2025 Bonds shall be executed on behalf of the District by the manual or facsimile signature of the Mayor of the City or his or her written designee and be attested by the manual or facsimile signature of the City Clerk. Zions Bancorporation, National Association is hereby appointed to act as trustee, registrar and transfer agent for the 2025 Bonds.

SECTION 4. The covenants set forth in the Indenture are hereby approved, shall be deemed to be covenants of the City Council and shall be complied with by the District and its officers. The Indenture shall constitute a contract between the District and the Owners of the 2025 Bonds. 4913-1818-5239v3/022599-0037

SECTION 5. The form of the Bond Purchase Agreement presented at this meeting is hereby approved and each of the Authorized Officers is hereby authorized to execute the Bond Purchase Agreement, with such additions thereto and changes therein relating to dates and numbers as are necessary to conform the Bond Purchase Agreement to the dates, amounts and interest rates applicable to the 2025 Bonds as of the sale date. Approval of such additions and changes shall be conclusively evidenced by the execution and delivery of the Bond Purchase Agreement by one or more of such Authorized Officers; provided, however, that the Bond Purchase Agreement shall be signed only if the Underwriter's discount does not exceed 1.475% of the principal amount of the 2025 Bonds and only if the true interest cost on the 2025 Bonds does not exceed 5.75%. Each of the Authorized Officers is authorized to determine the day on which the 2025 Bonds are to be priced in order to attempt to produce the lowest borrowing cost for the District and may reject any terms presented by the Underwriter if determined not to be in the best interest of the District.

SECTION 6. The form of the Continuing Disclosure Certificate presented at this meeting is hereby approved and each of the Authorized Officers is hereby authorized and directed to execute the Continuing Disclosure Certificate in the form hereby approved, with such additions therein and changes thereto as the officer or officers executing the same deem necessary to cure any defect or ambiguity therein, with such approval to be conclusively evidenced by the execution and delivery of such certificate.

SECTION 7. The form of the Preliminary Official Statement presented at this meeting is hereby approved and the Underwriter is hereby authorized to distribute the Preliminary Official Statement to prospective purchasers of the 2025 Bonds in the form hereby approved, together with such additions thereto and changes therein as are determined necessary by the Authorized Officers to make such Preliminary Official Statement final as of its date for purposes of Rule 15c2-12 of the Securities and Exchange Commission. Each of the Authorized Officers is hereby authorized to execute a final Official Statement in the form of the Preliminary Official Statement, together with such changes as are determined necessary by the Authorized Officers, to make such Official Statement complete and accurate as of its date. The Underwriter is further authorized to distribute the final Official Statement for the 2025 Bonds and any supplement thereto to the purchasers of the 2025 Bonds upon the execution of the final Official Statement as described above.

SECTION 8. In accordance with the requirements of Section 53345.8 of the Act, based on the Appraisal, the legislative body of the District hereby determines that the value of the real property in the District subject to the special tax to pay debt service on the 2025 Bonds is more than three times the principal amount of the 2025 Bonds and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within the District (including the 2023 Bonds), all as calculated in the manner provided in Section 53345.8(a) of the Act.

SECTION 9. Each Authorized Officer is authorized to provide for all services necessary to effect the issuance of the 2025 Bonds. Such services shall include, but not be limited to, printing the 2025 Bonds, obtaining legal services, trustee and paying agent services, and any other services deemed appropriate as set forth in a certificate of such Authorized Officer. Each Authorized Officer is authorized to pay for the cost of such services, together with other costs of issuance, from 2025 Bond proceeds deposited pursuant to the First Supplement.

SECTION 10. The Authorized Officers, the City Clerk and the other officers and staff of the City and the District responsible for the fiscal affairs of the District are hereby authorized and directed to take any actions and execute and deliver any and all documents as are necessary to accomplish the issuance, sale and delivery of the 2025 Bonds in accordance with the provisions of this Resolution and the fulfillment of the purposes of the 2025 Bonds as described in the Indenture, including, in the discretion of 4913-1818-5239v3/022599-0037

any of the Authorized Officers, providing certificates to the Underwriter as to the accuracy of any information relating to the District which is included within the Official Statement. Any document authorized herein to be signed by the City Clerk may be signed by a duly appointed deputy clerk.

SECTION 11. The City Council acknowledges that the good faith estimates required by Section 5852.1 of the California Government Code are disclosed in the staff report and are available to the public at the meeting at which this Resolution is approved.

SECTION 12. The form of the Amendment No. 1 to Acquisition Agreement presented at this meeting is hereby approved; and any one of the Authorized Officers is hereby authorized and directed to execute the Amendment No. 1 to Acquisition Agreement in the form hereby approved, with such additions therein and changes thereto as the Authorized Officer or Authorized Officers executing the same may deem necessary to cure any defect or ambiguity therein if such change does not materially alter the substance or content thereof, with such approval to be conclusively evidenced by the execution and delivery of such Amendment No. 1 to Acquisition Agreement.

SECTION 13. This Resolution shall be effective upon its adoption.

PASSED AND ADOPTED by the City Council of the City of Beaumont, California, this day of , 2025, by the following vote:

AYES:

NAYS:

ABSENT:

ABSTAIN:

MAYOR OF THE CITY OF BEAUMONT
ATTEST:

CITY CLERK
4913-1818-5239v3/022599-0037

FIRST SUPPLEMENT TO BOND INDENTURE
Between

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE)
and

ZIONS BANCORPORATION, NATIONAL ASSOCIATION,
as Trustee
Relating to
$

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE)
2025 SPECIAL TAX BONDS
Dated as of 1, 2025
4920-8008-9111/022599-0037

FIRST SUPPLEMENT TO BOND INDENTURE
THIS FIRST SUPPLEMENT TO BOND INDENTURE dated as of 1, 2025 (the "First Supplement"), governs the terms of the City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds, which are being issued as Parity Bonds in accordance with the Bond Indenture (the "Original Bond Indenture") dated as of May 1, 2023, by and between City of Beaumont Community Facilities District No. 2016-3 (Sundance) (the "District") and Zions Bancorporation, National Association (the "Trustee"), as successor trustee. The Original Bond Indenture and this First Supplement are hereinafter collectively referred to as the "Indenture." RECITALS :

A. The City Council of the City of Beaumont, located in the County of Riverside, California (the "City Council"), has undertaken proceedings and declared the necessity to issue bonds on behalf of the District pursuant to the terms and provisions of the Mello -Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the State of California (the "Act").

B. Based upon Resolution Nos. 2017-05, 2017-06 and 2017-07 adopted by the City Council on February 7, 2017 and Resolution No. 2023-12 adopted by the City Council on May 2, 2023, and an election held on February 7, 2017, authorizing the levy of a special tax and the issuance of bonds, the District is authorized to issue bonds in one or more series pursuant to the Act, in an aggregate principal amount not to exceed $22,000,000.

C. The District previously issued its Special Tax Bonds, Series 2023A in the aggregate principal amount of $8,800,000 to finance certain Project Costs (as defined in the Original Bond Indenture) pursuant to the Original Bond Indenture; and D. The legislative body of the District intends to finance additional Project Costs through the issuance of bonds in an aggregate principal amount of $ designated as the "City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds" (the "2025 Bonds"); and
E. Pursuant to Section 6.1(b), (c) and (f) of the Original Bond Indenture, the District desires to amend the Original Bond Indenture as set forth herein in connection with the issuance of the 2025 Bonds and the District has determined that such amendments are not materially adverse to the Owners; and
F. The District has determined all requirements of the Act for the issuance of the 2025 Bonds as Parity Bonds under the terms of the Original Bond Indenture have been satisfied; NOW, THEREFORE, in order to establish the terms and conditions upon and subject to which the 2025 Bonds are to be issued, and in consideration of the premises and of the mutual covenants contained herein and of the purchase and acceptance of the 2025 Bonds by the Owners thereof, and for other valuable consideration, the receipt of which is hereby acknowledged, the District does hereby covenant and agree, for the benefit of the Owners of the 2025 Bonds, as follows:
4920-8008-9111/022599-0037
Page364of789

ARTICLE I

DEFINITIONS
Section 1.1. Definitions. All capitalized terms not otherwise defined herein shall have the meaning set forth in the Original Bond Indenture provided that the following definitions are added and, where applicable, shall supersede any different definition of the same capitalized term provided in the Original Bond Indenture:

Interest Payment Date. The term "Interest Payment Date" means, with respect to the 2025 Bonds, September 1, 2025 and each March 1 and September 1 thereafter; provided, however, that, if any such day is not a Business Day, interest up to the Interest Payment Date will be paid on the Business Day next succeeding such date.

Term Bonds. The term "Term Bonds" means, with respect to the 2025 Bonds, the 2025 Bonds maturing on September 1, 20 , September 1, 20 , September 1, 20 , and September 1, 20 2025 Bonds. The term "2025 Bonds" means the District's 2025 Special Tax Bonds, issued on , 2025 in the aggregate principal amount of $
2025 Bonds Reserve Requirement. The term "2025 Bonds Reserve Requirement" means that amount as of any date of calculation equal to the lesser of: (i) 10% of the initial principal amount of the 2025 Bonds; (ii) Maximum Annual Debt Service on the then Outstanding 2025 Bonds; (iii) 125% of average Annual Debt Service on the then Outstanding 2025 Bonds; provided, however, that the 2025 Bonds Reserve Requirement shall not exceed $ .
2025 Bonds Reserve Subaccount. The term "2025 Bonds Reserve Subaccount" means the Subaccount by that name created and established in the Reserve Account pursuant to Section 3.2 hereof.

ARTICLE II

GENERAL AUTHORIZATION AND BOND TERMS
Section 2.1. Amount, Issuance, Purpose and Nature of 2025 Bonds. Under and pursuant to the Act and the Original Bond Indenture, as supplemented by this First Supplement, the 2025 Bonds in the aggregate principal amount of $ shall be issued as Parity Bonds governed by the terms of the Original Bond Indenture, as supplemented by this First Supplement, for the purpose of financing additional Project Costs benefitting the District, funding a deposit to the Reserve Account and paying Costs of Issuance of the 2025 Bonds.

Section 2.2. Description of Bonds; Interest Rates. The 2025 Bonds shall be designated "City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds." The 2025 Bonds shall be dated as of their Delivery Date and shall mature and be payable on September 1 in the years and in the aggregate principal amounts and shall be subject to and shall bear interest at the rates set forth in the table below payable on September 1, 2025 and each Interest Payment Date thereafter:
2 4920-8008-9111/022599-0037

Maturity Date
(September 1)
Principal Amount
Interest Rate
Section 2.3. Form of 2025 Bonds. The definitive 2025 Bonds may be printed from steel engraved or lithographic plates or may be typewritten. The 2025 Bonds and the certificate of authentication shall be substantially in the form attached hereto as Exhibit A, which form is hereby approved and adopted as the form of such 2025 Bonds and of the certificate of authentication.

Only the 2025 Bonds as shall bear thereon such certificate of authentication in the form set forth in Exhibit A attached hereto shall be entitled to any right or benefit under the Indenture, and no 2024 Bond shall be valid or obligatory for any purpose until such certificate of authentication shall have been duly executed by the Trustee.

Section 2.4. Book -Entry System. The 2025 Bonds shall be initially delivered in the form of a separate single fully registered 2024 Bond (which may be typewritten) for each maturity of the 2025 Bonds. Upon initial delivery, the ownership of each such 2024 Bond shall be registered in the registration books kept by the Trustee in the name of the Nominee as nominee of the Depository.

Except as provided in Section 2.14 of the Original Bond Indenture, all of the Outstanding 2025 Bonds shall be registered in the registration books kept by the Trustee in the name of the Nominee.

Section 2.5. Conditions to Issuance of 2025 Bonds. The 2025 Bonds shall not be issued unless and until the conditions for the issuance of the 2025 Bonds as Parity Bonds pursuant to 9.2 of the Original Bond Indenture shall have been satisfied or will be satisfied upon the issuance of the 2025 Bonds.

ARTICLE III
APPLICATION OF PROCEEDS OF 2025 BONDS
Section 3.1. Application of Proceeds.
(a) The proceeds of the sale of the 2025 Bonds shall be received by the Trustee on behalf of the District and deposited and transferred as follows:
(1) $ shall be transferred to the Costs of Issuance Account of the 4920-8008-9111/022599-0037
3

Acquisition and Construction Fund to pay the Costs of Issuance of the 2025 Bonds; (2) $ shall be transferred to the 2025 Bonds Reserve Subaccount of the Reserve Account of the Special Tax Fund to increase the amount therein to the 2025 Bonds Reserve Requirement as of the Delivery Date of the 2025 Bonds;
(3) $ shall be transferred to the Acquisition and Construction Fund of which $ shall be deposited in the City Facilities Account, $ shall be deposited in the Water Facilities Account and $ shall be deposited in the School Facilities Account.

The Trustee may, in its discretion, establish temporary funds or accounts in its books and records to facilitate such transfers.

Section 3.2. There is hereby created a subaccount of the Reserve Account of the Special Tax Fund referred to as the "2025 Bonds Reserve Subaccount," which shall be treated as a Subaccount of the Reserve Account for a series of Parity Bonds, as set forth in Section 3.6 of the Original Bond Indenture. Amounts in the 2025 Bonds Reserve Subaccount shall be utilized in accordance with Section 3.6 of the Original Bond Indenture.

ARTICLE IV
REDEMPTION OF 2025 BONDS
Section 4.1. Redemption of 2025 Bonds.
(a) Optional Redemption. The 2025 Bonds may be redeemed at the option of the District from any source of funds on any Interest Payment Date on or after September 1, , in whole or in part, from such maturities as are selected by the District and by lot within a maturity, at the following redemption prices, expressed as a percentage of the principal amount to be redeemed, together with accrued interest to the date of redemption:

Redemption Date Redemption Price
September 1, 20_ and March 1, 20_
September 1, 20_ and March 1, 20_
September 1, 20_ and March 1, 20_
September 1, 20 and any Interest Payment Date thereafter 103%
102
101
100
In the event that the District elects to redeem 2025 Bonds as provided above, the District shall give written notice to the Trustee of its election to so redeem, the redemption date and the principal amount of the 2025 Bonds of each maturity to be redeemed. The notice to the Trustee shall be given at least 30 but no more than 60 days prior to the redemption date, or by such later date as is acceptable to the Trustee.
(b) Mandatory Sinking Fund Redemption. The 2025 Bonds maturing on September 1, 20 (the " Term Bonds") shall be called before maturity and redeemed, from the Sinking Fund Payments that have been deposited into the Redemption Account established under the Original Bond Indenture, on September 1, 20_, and on each September 1 thereafter prior to maturity, in accordance with the schedule of Sinking Fund Payments set forth below. The Term Bonds so called for redemption shall be selected by the Trustee by lot and shall be redeemed at 4 4920-8008-9111/022599-0037

a redemption price for each redeemed Term Bond equal to the principal amount thereof, plus accrued interest to the redemption date, without premium, as follows Term Bonds Maturing September 1, 20__
Redemption Dates
(September 1)
* Maturity.

Redemption
Amount
S
If the District purchases Term Bonds during the Fiscal Year immediately preceding one of the sinking fund redemption dates specified above, the District shall notify the Trustee at least 45 days prior to the redemption date as to the principal amount purchased, and the amount purchased shall be credited at the time of purchase to the next Sinking Fund Payment for the Term Bond so purchased, to the extent of the full principal amount of the purchase. All 2025 Bonds purchased pursuant to this subsection shall be cancelled pursuant to Section 10.1 of the Original Bond Indenture.

In the event of a partial optional redemption or special mandatory redemption of the Term Bonds, each of the remaining Sinking Fund Payments for such Term Bonds shall be reduced, as nearly as practicable, on a pro rata basis.
(c) Special Mandatory Redemption. The 2025 Bonds are subject to special mandatory redemption as a whole or in part on a pro rata basis among maturities and by lot within a maturity, on any Interest Payment Date on or after September 1, 2025 and shall be redeemed by the Trustee, from Prepayments deposited to the Redemption Account pursuant to Section 3.2 of the Original Bond Indenture, plus amounts transferred from the Reserve Account pursuant to Section 3.6(c) of the Original Bond Indenture, at the following redemption prices, expressed as a percentage of the principal amount to be redeemed, together with accrued interest to the redemption date:

Redemption Date Redemption Price
Any Interest Payment Date from September 1, 2025 through March 1, 20 103% September 1, 20_ and March 1, 20_ 102
September 1, 20 and March 1, 20_ 101
September 1, 20_ and any Interest Payment Date thereafter 100

ARTICLE V

AMENDMENTS
Section 5.1. Amendment to Section 9.2 of the Original Bond Indenture. The first paragraph of Section 9.2 of the Original Bond Indenture is hereby amended and restated to state as 4920-8008-9111/022599-0037
5

follows:
"The District may at any time after the issuance and delivery of the Bonds hereunder issue Parity Bonds payable from the Net Taxes and other amounts deposited in the Special Tax Fund (other than in the Administrative Expense Account therein) and secured by a lien and charge upon such amounts equal to the lien and charge securing the Outstanding Bonds and any other Parity Bonds theretofore issued hereunder or under any Supplemental Indenture; provided, however, Parity Bonds may only be issued for the purpose of refunding all or a portion of the Bonds or any Parity Bonds then Outstanding. Parity Bonds may be issued subject to the following additional specific conditions, which are hereby made conditions precedent to the issuance of any such Parity Bonds:" Subparagraph (6) of Section 9.2(c) of the Original Bond Indenture is hereby deleted in its entirety and Subparagraph (7) of Section 9.2(c) of the Original Bond Indenture is hereby renumbered as Subparagraph (6).

ARTICLE VI

MISCELLANEOUS
Section 6.1. Provisions of Original Bond Indenture in Effect. Except as expressly modified herein, all of the provisions of the Original Bond Indenture shall remain in full force and effect.

Section 6.2. Partial Invalidity. If any section, paragraph, sentence, clause or phrase of this First Supplement shall for any reason be held illegal, invalid or unenforceable, such holding shall not affect the validity of the remaining portions of this First Supplement. The District hereby declares that it would have entered into this First Supplement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issuance of the 2025 Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this First Supplement may be held illegal, invalid or unenforceable.

Section 6.3.
several counterparts,
the same instrument.

Section 6.4.
accordance with the
such state.

Execution in Counterparts. This First Supplement may be executed in each of which shall be an original and all of which shall constitute but one and Governing Law. This First Supplement shall be construed and governed in laws of the State of California applicable to contracts made and performed in 4920-8008-9111/022599-0037
6

IN WITNESS WHEREOF, THE CITY OF BEAUMONT COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE) has caused this First Supplement to Bond Indenture to be signed by an Authorized Representative of the District and Zions Bancorporation, National Association in token of its acceptance of the trust created hereunder, has caused this First Supplement to Bond Indenture to be signed in its corporate name by its officers identified below, all as of the day and year first above written.

THE CITY OF BEAUMONT COMMUNITY
FACILITIES DISTRICT NO. 2016-3 (SUNDANCE)
By:

Mayor of the City of Beaumont, acting as the
legislative body of the City of Beaumont
Community Facilities District No. 2016-3
(Sundance)
ATTEST:

Acting City Clerk of the City of
Beaumont, acting as the legislative body
of the City of Beaumont Community
Facilities District No. 2016-3 (Sundance)

ZIONS BANCORPORATION, NATIONAL
ASSOCIATION, as Trustee
By:

Authorized Signatory
S-1
4920-8008-9111/022599-0037

EXHIBIT A

FORM OF SPECIAL TAX BOND

UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DISTRICT OR TRUSTEE FOR

REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY BOND ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO

SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY

TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

R- $

UNITED STATES OF AMERICA

STATE OF CALIFORNIA

COUNTY OF RIVERSIDE

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE)
2025 SPECIAL TAX BOND
INTEREST RATE: MATURITY DATE:

September 1, 20_
REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT:

DATED DATE:
, 2025

DOLLARS
CUSIP:

CITY OF BEAUMONT COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE) (the "District") which was formed by the City of Beaumont (the "City") and is situated in the County of Riverside, State of California, FOR VALUE RECEIVED, hereby promises to pay, solely from certain amounts held under the Indenture (as hereinafter defined), to the Owner named above, or registered assigns, on the Maturity Date set forth above, unless redeemed prior thereto as hereinafter provided, the Principal Amount set forth above, and to pay interest on such Principal Amount from the Interest Payment Date (as hereinafter defined) next preceding the date of authentication hereof, unless: (i) the date of authentication is an Interest Payment Date, in which event interest shall be payable from such date of authentication; (ii) the date of authentication is after a Record Date (as hereinafter defined) but prior to the immediately succeeding Interest Payment Date, in which event interest shall be payable from the Interest Payment Date immediately succeeding the date of authentication; or (iii) the date of authentication is prior to the close of business on the first Record Date, in which event interest shall be payable from the Dated Date set 4920-8008-9111/022599-0037
A-1

forth above. Notwithstanding the foregoing, if at the time of authentication of this Bond interest is in default, interest on this Bond shall be payable from the last Interest Payment Date to which the interest has been paid or made available for payment or, if no interest has been paid or made available for payment, interest on this Bond shall be payable from the Dated Date set forth above.

Interest will be paid semiannually on September 1, 2025 and each March 1 and September 1 thereafter (each an "Interest Payment Date"), at the Interest Rate set forth above, until the Principal Amount hereof is paid or made available for payment.

The principal of and premium, if any, on this Bond are payable to the Owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the Principal Office of the Trustee (as such term is defined in the Indenture), initially Zions Bancorporation, National Association, (the "Trustee"). Interest on this Bond shall be paid by check of the Trustee mailed, by first class mail, postage prepaid, or in certain circumstances described in the Indenture by wire transfer to an account within the United States of America, to the Owner hereof as of the close of business on the fifteenth day of the month preceding the month in which the Interest Payment Date occurs (the "Record Date") at such Owner's address as it appears on the registration books maintained by the Trustee.

This Bond is one of a duly authorized issue of "City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds" (the "Bonds") issued in the aggregate principal amount of $ pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, being Section 53311 et seq. of the California Government Code (the "Act") for the purpose of financing public improvements, funding a deposit to the reserve account and paying certain costs related to the issuance of the Bonds. The issuance of the Bonds and the terms and conditions thereof are provided for by a resolution adopted by the City Council of the City, acting in its capacity as the legislative body of the District (the "Legislative Body"), on , 2025, and a Bond Indenture dated as of May 1, 2023 (the "Original Bond Indenture"), as supplemented and amended by the First Supplement to Bond Indenture, dated as of 1, 2025 (the "First Supplement" and together with the Original Bond Indenture, the "Indenture"), each by and between the District and the Trustee, and this reference incorporates the Indenture herein, and by acceptance hereof the Owner of this Bond assents to said terms and conditions. The Indenture is adopted under and this Bond is issued under, and both are to be construed in accordance with, the laws of the State of California.

Pursuant to the Act and the Indenture, the principal of, premium, if any, and interest on this Bond are payable on a parity with the District's 2023 Special Tax Bonds, solely from the portion of the annual special taxes authorized under the Act to be levied and collected within the District (the "Special Taxes") and certain other amounts pledged to the repayment of the Bonds as set forth in the Indenture. Any amounts for the payment hereof shall be limited to the Net Taxes pledged and collected or foreclosure proceeds received following a default in payment of the Special Taxes and other amounts deposited to the Special Tax Fund (other than the Administrative Expense Account therein) established under the Indenture, except to the extent that other provision for payment has been made by the Legislative Body, as may be permitted by law. The District has covenanted for the benefit of the owners of the Bonds that under certain circumstances described in the Indenture it will commence and diligently pursue to completion appropriate foreclosure proceedings in the event of delinquencies of Special Tax installments levied for payment of principal and interest on the Bonds.

The Bonds may be redeemed at the option of the District from any source of funds on any Interest Payment Date on or after September 1, 20 , in whole or in part, from such maturities as are selected by the District and by lot within a maturity, at the following redemption prices, expressed as A-2
4920-8008-9111/022599-0037

a percentage of the principal amount to be redeemed, together with accrued interest to the date of redemption:

Redemption Date Redemption Price
September 1, 20__ and March 1, 20_
September 1, 20 and March 1, 20
September 1, 20 and March 1, 20
September 1, 20 and any Interest Payment Date thereafter 103%
102
101
100
The Bonds maturing on September 1, 20 (the " Term Bonds") shall be called before maturity and redeemed, from the Sinking Fund Payments that have been deposited into the Redemption Account established under the Original Bond Indenture, on September 1, 20 , and on each September 1 thereafter prior to maturity, in accordance with the schedule of Sinking Fund Payments set forth below. The Term Bonds so called for redemption shall be selected by the Trustee by lot and shall be redeemed at a redemption price for each redeemed Term Bond equal to the principal amount thereof, plus accrued interest to the redemption date, without premium, as follows:

Term Bonds Maturing September 1, 20_
Redemption Dates
(September 1)
*
* Maturity.

Redemption
Amount
$
The Bonds are subject to special mandatory redemption as a whole or in part on a pro rata basis among maturities and by lot within a maturity, on any Interest Payment Date on or after September 1, 2025 and shall be redeemed by the Trustee, from Prepayments deposited to the Redemption Account pursuant to the Indenture, plus amounts transferred from the Reserve Account pursuant to the Indenture, at the following redemption prices, expressed as a percentage of the principal amount to be redeemed, together with accrued interest to the redemption date:

Redemption Date Redemption Price
Any Interest Payment Date from September 1, 2025 through March 1, 20_ 103% September 1, 20_ and March 1, 20_ 102
September 1, 20_ and March 1, 20_ 101
September 1, 20 and any Interest Payment Date thereafter 100 Notice of redemption with respect to the Bonds to be redeemed shall be mailed to the registered owners thereof not less than 30 nor more than 45 days prior to the redemption date by first class mail, postage prepaid, to the addresses set forth in the registration books; provided, however, so long as the Bonds are registered in the name of the Nominee, such notice shall be given in such manner as complies with the requirements of the Depository. Neither a failure of the Owner hereof 4920-8008-9111/022599-0037
A-3

to receive such notice nor any defect therein will affect the validity of the proceedings for redemption. All Bonds or portions thereof so called for redemption will cease to accrue interest on the specified redemption date, provided that funds for the redemption are on deposit with the Trustee on the redemption date. Thereafter, the registered owners of such Bonds shall have no rights except to receive payment of the redemption price upon the surrender of the Bonds.

This Bond shall be registered in the name of the Owner hereof, as to both principal and interest, and the District and the Trustee may treat the Owner hereof as the absolute owner for all purposes and shall not be affected by any notice to the contrary.

The Bonds are issuable only in fully registered form in the denomination of $5,000 or any integral multiple thereof and may be exchanged for a like aggregate principal amount of Bonds of other authorized denominations of the same issue and maturity, all as more fully set forth in the Indenture. This Bond is transferable by the Owner hereof, in person or by his attorney duly authorized in writing, at the Principal Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Indenture, upon surrender and cancellation of this Bond. Upon such transfer, a new registered Bond of authorized denomination or denominations for the same aggregate principal amount of the same issue and maturity will be issued to the transferee in exchange therefor.

The Trustee shall not be required to register transfers or make exchanges of: (i) any Bonds for a period of 15 days next preceding any selection of the Bonds to be redeemed; or (ii) any Bonds chosen for redemption.

The rights and obligations of the District and of the registered owners of the Bonds may be amended at any time, and in certain cases without notice to or the consent of the registered owners, to the extent and upon the terms provided in the Indenture.

THE BONDS DO NOT CONSTITUTE GENERAL OBLIGATIONS OF THE CITY OR OF THE DISTRICT. NEITHER THE CITY NOR THE DISTRICT IS OBLIGATED TO LEVY OR

PLEDGE, OR HAS LEVIED OR PLEDGED, GENERAL OR SPECIAL TAXES, OTHER THAN THE SPECIAL TAXES REFERENCED HEREIN. THE BONDS ARE LIMITED OBLIGATIONS

OF THE DISTRICT PAYABLE FROM THE PORTION OF THE SPECIAL TAXES AND OTHER

AMOUNTS PLEDGED UNDER THE INDENTURE BUT ARE NOT A DEBT OF THE CITY,

THE STATE OF CALIFORNIA OR ANY OF ITS POLITICAL SUBDIVISIONS WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY LIMITATION OR RESTRICTION.

This Bond shall not become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been dated and signed by the Trustee.

IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by law, and that the amount of this Bond, together with all other indebtedness of the District, does not exceed any debt limit prescribed by the laws or Constitution of the State of California.

A-4
4920-8008-9111/022599-0037
Page374of789

IN WITNESS WHEREOF, the District has caused this Bond to be dated the Dated Date, to be signed on behalf of the District by the Mayor of the City by his facsimile signature and attested by the facsimile signature of the Acting City Clerk of the City.

Mayor of the City of Beaumont, acting as the
legislative body of the City of Beaumont Community
Facilities District No. 2016-3 (Sundance)
ATTEST:

Acting City Clerk of the City of Beaumont,
acting as the legislative body of the City of
Beaumont Community Facilities District
No. 2016-3 (Sundance)
[FORM OF TRUSTEE'S CERTIFICATE
OF AUTHENTICATION AND REGISTRATION]
This is one of the Bonds described in the within -defined Indenture.

Dated:
, 2025 ZIONS BANCORPORATION, NATIONAL
ASSOCIATION, as Trustee
By:

Authorized Signatory
[FORM OF LEGAL OPINION]
The following is a true copy of the opinion rendered by Stradling Yocca Carlson & Rauth LLP, in connection with the issuance of, and dated as of the date of the original delivery of, the Bonds. A signed copy is on file in my office.

Acting City Clerk of the City
4920-8008-9111/022599-0037
A-5

[FORM OF ASSIGNMENT]
For value received the undersigned do(es) hereby sell, assign and transfer unto whose tax identification number is
the within -mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s) attorney to transfer the same on the books of the Trustee with full power of substitution in the premises.

Dated:

Signature guaranteed:

NOTE: Signature(s) must be guaranteed by an NOTE: The signatures(s) on this Assignment eligible guarantor institution. must correspond with the name(s) as written on the face of the within Bond in every particular
without alteration or enlargement or any change
whatsoever.

A-6
4920-8008-9111/022599-0037

CITY OF BEAUMONT
COMMUNITY FACILITIES DISTRICT NO. 2016-3 (SUNDANCE)
2025 SPECIAL TAX BONDS

BOND PURCHASE AGREEMENT
, 2025
City of Beaumont
Community Facilities District No. 2016-3 (Sundance)
550 East 6th Street
Beaumont, California 92223
Ladies and Gentlemen:

Stifel, Nicolaus & Company, Incorporated, as underwriter (the "Underwriter"), acting not as a fiduciary or agent for you, but on behalf of itself, offers to enter into this Bond Purchase Agreement (this "Purchase Agreement") with the City of Beaumont Community Facilities District No. 2016-3 (Sundance) (the "Community Facilities District"), which upon acceptance will be binding upon the Underwriter and the Community Facilities District. The agreement of the Underwriter to purchase the Bonds (as hereinafter defined) is contingent upon the Community Facilities District satisfying all of the obligations imposed upon them under this Purchase Agreement. This offer is made subject to the Community Facilities District's acceptance by the execution of this Purchase Agreement and its delivery to the Underwriter at or before 11:59 P.M., local time, on the date hereof, and, if not so accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the Community Facilities District at any time prior to the acceptance hereof by the Community Facilities District. All capitalized terms used herein, which are not otherwise defined, shall have the meaning provided for such terms in the Bond Indenture, dated as of May 1, 2023, as supplemented by that certain First Supplement to Bond Indenture, dated as of 1, 2025, (together, the "Indenture") each by and between the District and Zions Bancorporation, National Association, as successor trustee (the "Trustee").

1. Purchase, Sale and Delivery of the Bonds.

Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein: the Underwriter hereby agrees to purchase from the Community Facilities District and the Community Facilities District hereby agrees to sell to the Underwriter all (but not less than all) of the $ aggregate principal amount of the City of Beaumont Community Facilities District No. 2016-3 (Sundance) 2025 Special Tax Bonds (the "Bonds"), dated the Closing Date (as hereinafter defined), bearing interest at the rates and maturing on the dates and in the principal amounts set forth in Exhibit A hereto. The purchase price for the Bonds shall be $ (being 100% of the aggregate principal amount thereof, plus an original issue premium of $ and less an Underwriter's discount of $ ).

The Underwriter agrees to make a bona fide public offering of all of the Bonds initially at the public offering prices (or yields) set forth in Exhibit A attached hereto and incorporated herein by

reference. Subsequent to the initial public offering, the Underwriter reserves the right to change the public offering prices (or yields) as it deems necessary in connection with the marketing of the Bonds, provided that the Underwriter shall not change the interest rates set forth in Exhibit A. The Bonds may be offered and sold to certain dealers at prices lower than such initial offering prices.

The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable from Net Taxes as provided in the Indenture, the Preliminary Official Statement (as hereinafter defined), and the Mello -Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the Government Code of the State of California) (the "Community Facilities District Act"). The issuance of the Bonds has been duly authorized by the City Council of the City of Beaumont (the "City"), as the legislative body for the Community Facilities District pursuant to a resolution (the "Community Facilities District Resolution of Issuance") adopted on , 2025.

The proceeds of the Bonds will be used to: (i) finance certain public improvements owned by the City and needed with respect to the development of property located within the Community Facilities District; (ii) fund a deposit to the 2025 Bonds Reserve Subaccount of the Reserve Account; and (iii) pay costs of issuance for the Bonds.

The Bonds shall be payable on a parity with the Community Facilities District's 2023 Special Tax Bonds, which are currently outstanding in the aggregate principal amount of $8,665,000 (the "2023 Bonds").

A. The Community Facilities District hereby acknowledges that the Underwriter is entering into this Purchase Agreement in reliance on the representations, warranties and agreements made by the Community Facilities District herein, and the Community Facilities District shall take all action necessary to enforce its rights hereunder for the benefit of the Underwriter and shall immediately notify the Underwriter if it becomes aware that any representation, warranty or agreement made by the Community Facilities District herein is incorrect in any material respect.

The Community Facilities District acknowledges and agrees that (i) the purchase and sale of the Bonds pursuant to this Purchase Agreement is an arm's -length commercial transaction between the Community Facilities District and the Underwriter, (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as principal and not as the agent or fiduciary of the Community Facilities District, (iii) the Underwriter has not assumed an advisory or fiduciary responsibility in favor of the Community Facilities District with respect to (a) the offering of the Bonds or the process leading thereto (whether or not the Underwriter, or any affiliate of the Underwriter, has advised or is currently advising the Community Facilities District on other matters) or (b) any other obligations to the Community Facilities District with respect to the offering contemplated hereby, except the obligations expressly set forth in this Purchase Agreement or otherwise imposed by law, (iv) the Underwriter has financial interests that differ from those of the Community Facilities District and (v) the Community Facilities District has consulted their own legal, financial and other advisors to the extent they have deemed appropriate in connection with this transaction. The Community Facilities District acknowledges that it has previously provided the Underwriter with an acknowledgement of receipt of the required Underwriter disclosure under Rule G-17 of the Municipal Securities Rulemaking Board ("MSRB"). The Community Facilities District acknowledges and represents that it has engaged Urban Futures, Inc. (the "Municipal Advisor") as its 2

municipal advisor (as defined in Securities and Exchange Commission Rule 15Ba1) and will rely solely on the financial advice of the Municipal Advisor with respect to the Bonds.

B. Pursuant to the authorization of the Community Facilities District, the Underwriter has distributed copies of the Preliminary Official Statement dated [POS Date], relating to the Bonds, which, together with the cover page, inside cover page and appendices thereto is herein called the "Preliminary Official Statement." By its acceptance of this Purchase Agreement, the Community Facilities District hereby ratifies the use by the Underwriter of the Preliminary Official Statement, and the Community Facilities District agrees to execute a final official statement relating to the Bonds (the "Official Statement") which will consist of the Preliminary Official Statement with such changes as may be made thereto, with the approval of Stradling Yocca Carlson & Rauth LLP, Bond Counsel ("Bond Counsel"), Stradling Yocca Carlson & Rauth LLP, Disclosure Counsel ("Disclosure Counsel"), and the Underwriter, and to provide copies thereof to the Underwriter as set forth herein. The Community Facilities District hereby authorizes and requires the Underwriter to use and promptly distribute, in connection with the offer and sale of the Bonds, the Preliminary Official Statement, the Official Statement and any supplement or amendment thereto. The Community Facilities District further authorizes the Underwriter to use and distribute, in connection with the offer and sale of the Bonds, the Indenture, the Continuing Disclosure Certificate executed by the Community Facilities District in connection with the Bonds (the "Continuing Disclosure Certificate"), this Purchase Agreement and all information contained herein, and all other documents, certificates and statements furnished by or on behalf of the Community Facilities District to the Underwriter in connection with the transactions contemplated by this Purchase Agreement.

C. To assist the Underwriter in complying with Securities and Exchange Commission Rule 15c2 -12(b)(5) (the "Rule"), the Community Facilities District will undertake pursuant to the Continuing Disclosure Certificate, in the form attached to the Official Statement as an appendix, to provide annual reports and notices of certain enumerated events. A description of this undertaking is set forth in the Preliminary Official Statement and will also be set forth in the Official Statement.

D. Except as the Underwriter and the Community Facilities District may otherwise agree, the Community Facilities District will deliver to the Underwriter, at the offices of Bond Counsel in Newport Beach, California, or at such other location as may be mutually agreed upon by the Underwriter and the Community Facilities District, the documents hereinafter mentioned; and the Community Facilities District will deliver to the Underwriter through the facilities of The Depository Trust Company ("DTC"), the Bonds, in definitive form (all Bonds bearing CUSIP numbers), duly executed by the Community Facilities District and authenticated by the Trustee in the manner provided for in the Indenture and the Community Facilities District Act at 8:00 a.m. California time, on [Closing Date] (the "Closing Date"), and the Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in paragraph (A) of this Section by wire transfer, payable in federal or other immediately available funds (such delivery and payment being herein referred to as the "Closing"). The Bonds shall be in fully registered book -entry form (which may be typewritten) and shall be registered in the name of Cede & Co., as nominee of DTC.

2. Representations, Warranties and Covenants of the Community Facilities District.

The Community Facilities District represents, warrants and covenants to the Underwriter on behalf of itself and the City that:
3

A. The City is duly organized and validly existing as a general law city under the Constitution and laws of the State of California (the "State") and has duly authorized the formation of the Community Facilities District pursuant to resolutions duly adopted by the City Council (the "Community Facilities District Formation Resolution" and, together with the Community Facilities District Resolution of Issuance, the "Community Facilities District Resolutions") and the Community Facilities District Act. The City Council, as the legislative body of the City and the Community Facilities District, has duly adopted the Community Facilities District Formation Resolution, and has caused to be recorded in the real property records of the County of Riverside, a notice of special tax lien (the "Notice of Special Tax Lien") (the Community Facilities District Formation Resolution and Notice of Special Tax Lien being collectively referred to herein as the "Formation Documents"), and has duly adopted a Community Facilities District Resolution of Issuance. Each of the Formation Documents remains in full force and effect as of the date hereof and has not been amended. The Community Facilities District is duly organized and validly existing as a Community Facilities District under the laws of the State. The Community Facilities District has, and at the Closing Date will have, as the case may be, full legal right, power and authority: (i) to execute, deliver and perform its obligations under this Purchase Agreement, the Continuing Disclosure Certificate and the Indenture, and to carry out all transactions contemplated by each of such agreements; (ii) to issue, sell and deliver the Bonds as provided herein; and (iii) to carry out, give effect to and consummate the transactions contemplated by the Formation Documents, the Community Facilities District Resolution of Issuance, the Indenture, the Bonds, the Continuing Disclosure Certificate, this Purchase Agreement and the Official Statement.

This Purchase Agreement, the Indenture, the Bonds and the Continuing Disclosure Certificate are collectively referred to herein as the "Community Facilities District Documents." B. The Community Facilities District and the City, as applicable, have each complied, and will at the Closing Date be in compliance in all material respects, with the Formation Documents, the Community Facilities District Resolution of Issuance and the Community Facilities District Documents, and any immaterial noncompliance by the Community Facilities District and the City, if any, will not impair the ability of the Community Facilities District and the City, as applicable, to carry out, give effect to or consummate the transactions contemplated by the foregoing.

From and after the date of issuance of the Bonds, the Community Facilities District will continue to comply with the covenants of the Community Facilities District contained in the Community Facilities District Documents.

C. The information in the Preliminary Official Statement and in the Official Statement relating to the Community Facilities District and the Bonds (other than statements pertaining to the book entry system, as to which no view is expressed), is true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and, upon delivery and up to and including 25 days after the End of the Underwriting Period (as defined in paragraph (D) below), the Official Statement will be amended and supplemented so as to contain no misstatement of any material fact or omission of any statement necessary to make the statements contained therein, in the light of the circumstances in which such statements were made, not misleading.

D. Up to and including 25 days after the End of the Underwriting Period (as defined below), the Community Facilities District will advise the Underwriter promptly of any proposal to amend or supplement the Official Statement and will not effect or consent to any such 4

amendment or supplement without the consent of the Underwriter, which consent will not be unreasonably withheld. The Community Facilities District will advise the Underwriter promptly of the institution of any proceedings known to it by any governmental agency prohibiting or otherwise materially affecting the use of the Official Statement in connection with the offering, sale or distribution of the Bonds. As used herein, the term "End of the Underwriting Period" means the later of such time as: (i) the Bonds are delivered to the Underwriter; or (ii) the Underwriter does not retain, directly or as a member of an underwriting syndicate, an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary, the End of the Underwriting Period shall be deemed to be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the Community Facilities District at or prior to the Closing Date and shall specify a date (other than the Closing Date) to be deemed the "End of the Underwriting Period." E. Except as described in the Preliminary Official Statement, the Community Facilities District is not, in any respect material to the transactions referred to herein or contemplated hereby, in breach of or in default under, any law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, and the performance of its obligations under the Community Facilities District Documents and compliance with the provisions of each thereof, or the performance of the conditions precedent to be performed by the Community Facilities District pursuant to this Purchase Agreement, will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, in any manner which would materially and adversely affect the performance by the Community Facilities District of its obligations under the Community Facilities District Documents or the performance of the conditions precedent to be performed by the Community Facilities District pursuant to this Purchase Agreement.

F. Except as may be required under the "blue sky" or other securities laws of any jurisdiction, all approvals, consents, authorizations, elections and orders of, or filings or registrations with, any governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would materially adversely affect, the performance by the Community Facilities District of its obligations under the Community Facilities District Documents, and the performance of the conditions precedent to be performed by the Community Facilities District pursuant to this Purchase Agreement, have been or will be obtained at the Closing Date and are or will be in full force and effect at the Closing Date.

G. The Community Facilities District Documents conform as to form and tenor to the descriptions thereof contained in the Official Statement.

H. The Bonds are payable from the Special Tax of the Community Facilities District to be levied within the Community Facilities District, as set forth in the Indenture, which levy has been duly and validly authorized pursuant to the Community Facilities District Act and the Special Taxes to be levied within the Community Facilities District will be fixed and levied in an amount which, together with other available funds, is required for the payment of the principal of, 5

and interest on, the Bonds when due and payable, all as provided in the Indenture. The Community Facilities District has covenanted to cause the Special Taxes to be levied as set forth in the Indenture.

I. The Indenture creates a valid pledge of, first lien upon and security interest in, the Net Taxes, and in the moneys in the Special Tax Fund (other than the Administrative Expense Fund) established pursuant to the Indenture, on the terms and conditions set forth in the Indenture.

J. Except as disclosed in the Preliminary Official Statement and Official Statement, there are, to the best of the Community Facilities District's knowledge, no entities with outstanding assessment liens against any of the properties within the Community Facilities District or which are senior to or on a parity with the pledge of the Special Taxes of the Community Facilities District referred to in paragraph (H) hereof.

K. The Official Statement as of the date hereof, does not, and as of the Closing Date, will not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (excluding statements therein pertaining to the DTC and its book -entry system and any information provided by the Special Tax Consultant (as such term is defined below) and the Underwriter, as to which no view is expressed).

L. The Preliminary Official Statement was deemed final by a duly authorized officer of the Community Facilities District prior to its delivery to the Underwriter, except for the omission of such information as is permitted to be omitted in accordance with paragraph (b)(1) of the Rule. The Community Facilities District hereby covenants and agrees that, within seven (7) business days from the date hereof, or upon reasonable written notice from the Underwriter within sufficient time to accompany any confirmation requesting payment from any customers of the Underwriter, the Community Facilities District shall cause a final printed form of the Official Statement to be delivered to the Underwriter in sufficient quantity to comply with paragraph (b)(4) of the Rule and Rules G-12, G-15, G-32 and G-36 of the Municipal Securities Rulemaking Board.

M. At the time of acceptance hereof there is and as of the Closing there will be no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body (collectively and individually, an "Action") pending (notice of which has been served on the Community Facilities District) or to the best knowledge of the Community Facilities District or the City threatened, in which any such Action: (i) in any way questions the existence of the Community Facilities District or the titles of the officers of the Community Facilities District to their respective offices; (ii) affects, contests or seeks to prohibit, restrain or enjoin the issuance or delivery of the Bonds or the payment or collection of Special Taxes or any amounts pledged or to be pledged to pay the principal of and interest on the Bonds, or in any way contests or affects the validity of the Community Facilities District Documents or the consummation of the transactions on the part of the Community Facilities District contemplated thereby; (iii) contests the exemption of interest on the Bonds from federal or State income taxation or contests the powers of the Community Facilities District which may result in any material adverse change relating to the financial condition of the Community Facilities District; or (iv) contests the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto or asserts that the Preliminary Official Statement or the Official Statement contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and as of the time of acceptance hereof 6

there is and, as of the Closing Date, there will be no basis for any action, suit, proceeding, inquiry or investigation of the nature described in clauses (i) through (iv) of this sentence.

N. Any certificate signed on behalf of the Community Facilities District by any officer or employee of the Community Facilities District authorized to do so shall be deemed a representation and warranty by the Community Facilities District to the Underwriter on behalf of itself and the Community Facilities District as to the statements made therein.

O. At or prior to the Closing, the Community Facilities District will have duly authorized, executed and delivered the Continuing Disclosure Certificate in substantially the form attached as an appendix to the Official Statement. Based upon a review of its previous undertakings, and except as disclosed in the Preliminary Official Statement and the Official Statement, the Community Facilities District has not failed to comply in all respects with any previous undertakings with regard to the Rule to provide annual reports or notices of enumerated events in the last five years.

P. The Community Facilities District will apply the proceeds of the Bonds in accordance with the Indenture and as described in the Preliminary Official Statement and Official Statement.

Q. Until such time as moneys have been set aside in an amount sufficient to pay all then outstanding Bonds at maturity or to the date of redemption if redeemed prior to maturity, plus unpaid interest thereon and premium, if any, to maturity or to the date of redemption if redeemed prior to maturity, the Community Facilities District will faithfully perform and abide by all of the covenants, undertakings and provisions contained in the Indenture.

R. Between the date of this Purchase Agreement and the date of Closing, the Community Facilities District will not offer or issue any bonds, notes or other obligations for borrowed money not previously disclosed to the Underwriter.

The Community Facilities District hereby approves the preparation and distribution of the Official Statement, consisting of the Preliminary Official Statement with such changes as are noted thereon and as may be made thereto, with the approval of Bond Counsel, Disclosure Counsel and the Underwriter, from time to time prior to the Closing Date.

The Community Facilities District hereby ratifies any prior use of and authorizes the future use by the Underwriter, in connection with the offering and sale of the Bonds, of the Preliminary Official Statement, the Official Statement, this Purchase Agreement and all information contained herein, and all other documents, certificates and written statements furnished by the Community Facilities District to the Underwriter in connection with the transactions contemplated by this Purchase Agreement.

The execution and delivery of this Purchase Agreement by the Community Facilities District shall constitute a representation by the Community Facilities District to the Underwriter that the representations and warranties contained in this Section 2 with respect to the Community Facilities District are true as of the date hereof.

3. Conditions to the Obligations of the Underwriter. The obligation of the Underwriter to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the 7

Underwriter, to the accuracy in all material respects of the representations and warranties on the part of the Community Facilities District contained herein, to the accuracy in all material respects of the statements of the officers and other officials of the Community Facilities District made in any certificates or other documents furnished pursuant to the provisions hereof, to the performance by the Community Facilities District of their obligations to be performed hereunder at or prior to the Closing Date and to the following additional conditions:

A. At the Closing Date, the Community Facilities District Resolutions and the Community Facilities District Documents shall be in full force and effect, and shall not have been amended, modified or supplemented, except as may have been agreed to in writing by the Underwriter, and there shall have been taken in connection therewith, with the issuance of the Bonds, and with the transactions contemplated thereby, all such actions as, in the opinion of Bond Counsel, shall be necessary and appropriate.

B. At the Closing Date, except as described in the Preliminary Official Statement, the City shall not be, in any respect material to the transactions referred to herein or contemplated hereby, in breach of or in default under, any law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the City is a party or is otherwise subject or bound, and the performance of the conditions precedent to be performed hereunder will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the City is a party or is otherwise subject or bound, in any manner which would materially and adversely affect the performance of the conditions precedent to be performed by the City hereunder.

C. At the Closing Date, except as described in the Preliminary Official Statement, the Community Facilities District shall not be, in any respect material to the transactions referred to herein or contemplated hereby, in breach of or in default under, any law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, and the performance by the Community Facilities District of its obligations under the Bonds, the Community Facilities District Resolutions, the Indenture, and any other instruments contemplated by any of such documents, and compliance with the provisions of each thereof, or the performance of the conditions precedent to be performed hereunder, will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, in any manner which would materially and adversely affect the performance by the Community Facilities District of its obligations under the Indenture, the Bonds or the performance of the conditions precedent to be performed by the Community Facilities District hereunder. 8 Page384of789

D. The information contained in the Official Statement is, as of the Closing Date and as of the date of any supplement or amendment thereto pursuant hereto, true and correct in all material respects and does not, as of the Closing Date or as of the date of any supplement or amendment thereto, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

E. Between the date hereof and the Closing Date, the market price or marketability, at the initial offering prices set forth on the cover page of the Official Statement, of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds, shall not have been materially adversely affected, in the judgment of the Underwriter (evidenced by a written notice to the Community Facilities District terminating the obligation of the Underwriter to accept delivery of and pay for the Bonds), by reason of any of the following:

1. Legislation introduced in or enacted (or resolution passed) by the Congress of the United States of America or recommended to the Congress by the President of the United States, the Department of the Treasury, the Internal Revenue Service, or any member of Congress, or favorably reported for passage to either House of Congress by any committee of such House to which such legislation had been referred for consideration, or a decision rendered by a court established under Article III of the Constitution of the United States of America or by the Tax Court of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Treasury Department of the United States of America or the Internal Revenue Service, with the purpose or effect, directly or indirectly, of imposing federal income taxation upon such interest as would be received by any owners of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof; or

2. Legislation introduced in or enacted (or resolution passed) by the Congress or an order, decree or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission (the "SEC"), or any other governmental agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, including any or all underlying arrangements, are not exempt from registration under or other requirements of the Securities Act of 1933, as amended (the "Securities Act"), or that the Indenture is not exempt from qualification under or other requirements of the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), or that the issuance, offering or sale of obligations of the general character of the Bonds, including any or all underlying arrangements, as contemplated hereby or by the Official Statement or otherwise is or would be in violation of the federal securities laws as amended and then in effect; or

3. A general suspension of trading on the New York Stock Exchange or other major exchange shall be in force, or minimum or maximum prices for trading shall have been fixed and be in force, or maximum ranges for prices for securities shall have been required and be in force on any such exchange, whether by virtue of determination by that exchange or by order of the SEC or any other governmental authority having jurisdiction; or

4. The introduction, proposal or enactment of any amendment to the federal or State Constitution or any action by any federal or State court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the Community Facilities 9

District, its property, income, securities (or interest thereon), the validity or enforceability of Special Taxes, or the ability of the Community Facilities District to issue the Bonds as contemplated by the Indenture and the Official Statement; or

5. Any event occurring, or information becoming known which, in the judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Preliminary Official Statement or in the Official Statement, or has the effect that the Preliminary Official Statement or the Official Statement contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; or

6. Any national securities exchange, the Comptroller of the Currency, or any other governmental authority, shall impose as to the Bonds, or obligations of the general character of the Bonds, any material restrictions not now in force, or increase materially those now in force, with respect to the extension of credit by, or the charge to the net capital requirements of, the Underwriter; or

7. There shall have occurred (1) an outbreak or escalation of hostilities or the declaration by the United States of a national emergency or war or (2) any other calamity or crisis in the financial markets of the United States or elsewhere or the escalation of such calamity or crisis; or

8. Except as disclosed in or contemplated by the Official Statement, any material adverse change in the affairs of the City or Community Facilities District shall have occurred; or

9. Any event or circumstance shall exist that either makes untrue or incorrect in any material respect any statement or information in the Official Statement (other than any statement provided by the Underwriter) or is not reflected in the Official Statement but should be reflected therein in order to make the statements therein, in the light of the circumstances under which they were made, not misleading and, in either such event, the Community Facilities District refuses to permit the Official Statement to be supplemented to supply such statement or information, or the effect of the Official Statement as so supplemented is to materially adversely affect the market price or marketability of the Bonds or the ability of the Underwriters to enforce contracts for the sale of the Bonds; or

10. A general banking moratorium shall have been declared by federal or State authorities having jurisdiction and be in force; or

11. A material disruption in securities settlement, payment or clearance services affecting the Bonds shall have occurred; or

12. Any new restriction on transactions in securities materially affecting the market for securities (including the imposition of any limitation on interest rates) or the extension of credit by, or a charge to the net capital requirements of, underwriters shall have been established by the New York Stock Exchange, the SEC, any other federal or State agency or the Congress of the United States, or by Executive Order; or
10

13. A decision by a court of the United States shall be rendered, or a stop order, release, regulation or no -action letter by or on behalf of the SEC or any other governmental agency having jurisdiction of the subject matter shall have been issued or made, to the effect that the issuance, offering or sale of the Bonds, including the underlying obligations as contemplated by this Purchase Agreement or by the Official Statement, or any document relating to the issuance, offering or sale of the Bonds, is or would be in violation of any provision of the federal securities laws at the Closing Date, including the Securities Act, the Securities Exchange Act of 1934, as amended and the Trust Indenture Act; or

14. Any proceeding shall have been commenced or be threatened in writing by the SEC against the City or the Community Facilities District; or

15. The commencement of any Action as described in items (i) through (iv) of Section 2(M) hereof.

F. At or prior to the Closing Date, the Underwriter shall have received a counterpart original or certified copy of the following documents, in each case satisfactory in form and substance to the Underwriter:

1. The Official Statement, executed on behalf of the Community Facilities District by an authorized officer;

2. The Indenture, duly executed and delivered by the Community Facilities District and the Trustee;

3. The Community Facilities District Resolutions and the Community Facilities District Documents and the Formation Documents, together with a certificate dated as of the Closing Date of the City Clerk to the effect that the Community Facilities District Resolutions are true, correct and complete copies of the ones duly adopted by the City Council;

4. The Continuing Disclosure Certificate executed and delivered by the Community Facilities District;

5. An unqualified approving opinion of Bond Counsel for the Bonds, dated the Closing Date and addressed to the Community Facilities District, to the effect that the Bonds are the valid, legal and binding obligations of the Community Facilities District and that the interest thereon is excluded from gross income for federal income tax purposes and exempt from personal income taxes of the State, in substantially the form included as an appendix to the Official Statement, together with a letter of Bond Counsel, dated the Closing Date and addressed to the Underwriter, to the effect that such opinion addressed to the Community Facilities District may be relied upon by the Underwriter to the same extent as if such opinion was addressed to it;

6. A supplemental opinion or opinions of Bond Counsel, dated the Closing Date and addressed to the Underwriter, to the effect that:
(i) this Purchase Agreement and the Continuing Disclosure Certificate have been duly authorized, executed and delivered by the Community Facilities District and, assuming due authorization, execution and delivery by the other parties thereto, as applicable, constitute the legal, valid and binding agreement of the Community Facilities District and are 11

enforceable in accordance with their terms, except to the extent that enforceability may be limited by moratorium, bankruptcy, reorganization, insolvency or other similar laws affecting creditors' rights generally or by the exercise of judicial discretion in accordance with general principles of equity or otherwise in appropriate cases and by limitations on legal remedies against public agencies in the State;
(ii) the Bonds are not subject to the registration requirements of the Securities Act, and the Indenture is exempt from qualification under the Trust Indenture Act; (iii) the information contained in the Official Statement on the cover and under the captions "THE 2025 BONDS" (other than the caption "Debt Service Schedule"), "SOURCES OF PAYMENT FOR THE BONDS," "TAX MATTERS" and in Appendices C and E to the Official Statement, are accurate insofar as such statements purport to summarize certain provisions of the Bonds, the Indenture and Bond Counsel's final approving opinion.

7. The letter of Disclosure Counsel, dated the Closing Date and addressed to the Community Facilities District and to the Underwriter, to the effect that, without having undertaken to determine independently the accuracy or completeness of the statements contained in the Official Statement, but on the basis of their participation in conferences with representatives of the Community Facilities District, the Special Tax Consultant and others, and their examination of certain documents, nothing has come to their attention which has led them to believe that the Preliminary Official Statement as of its date and the Official Statement as of its date and as of the Closing Date contained or contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (except that no opinion or belief need be expressed as to any financial statements or other financial, statistical or engineering data or forecasts, numbers, charts, estimates, projections, assumptions, or expressions of opinion, any information about valuation, appraisals, absorption, archeological or environmental matters, or any information with respect to the City, or about DTC or the book -entry -only system);

8. A certificate dated the Closing Date and signed by an authorized representative of the Community Facilities District or an authorized designee, on behalf of the Community Facilities District to the effect that: (i) the representations and warranties made by the Community Facilities District contained herein are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date; (ii) to the best knowledge of such officer, no event has occurred since the date of the Official Statement which should be disclosed in the Official Statement for the purpose for which it is to be used or which it is necessary to disclose therein in order to make the statements and information therein not misleading in any material respect; and (iii) the Community Facilities District has complied with all the agreements and satisfied all the conditions on its part to be satisfied under this Purchase Agreement, the Community Facilities District Resolutions, the Community Facilities District Documents and the Official Statement at or prior to the Closing Date;

9. An opinion of the City Attorney of the City, dated the date of Closing and addressed to the Underwriter and the City, to the effect that:
(i) The City is a municipal corporation and general law city, duly organized and existing under the Constitution and laws of the State of California; 12

(ii) The Community Facilities District Resolutions have been duly adopted at meetings of the City Council, which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting throughout, and the Community Facilities District Resolutions are in full force and effect and have not been modified, amended, rescinded or repealed since the respective dates of their adoption; (iii) The Community Facilities District Documents and the Official Statement have been duly authorized, executed and delivered by the City and the Community Facilities District Documents constitute the legal, valid and binding obligations of the Community Facilities District enforceable against the Community Facilities District in accordance with their terms, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights, to the application of equitable principles where equitable remedies are sought and to the exercise of judicial discretion in appropriate cases; (iv) Except as may be stated in the Official Statement, there is no action, suit, proceeding or investigation before or by any court, public board or body pending (notice of which has been served on the City or the Community Facilities District) or, to such counsel's knowledge, threatened wherein an unfavorable decision, ruling or finding would: (a) affect the creation, organization, existence or powers of the City, or the titles of its members and officers to their respective offices; or (b) affect the validity of the Community Facilities District Documents or restrain or enjoin the repayment of the Bonds or in any way contest or affect the validity of the Community Facilities District Documents or contest the authority of the Community Facilities District or the City to enter into or perform its obligations under any of the Community Facilities District Documents, questions the right of the Community Facilities District to use Special Taxes levied within the Community Facilities District for the repayment of the Bonds or affects in any manner the right or ability of the Community Facilities District to collect or pledge the Special Taxes levied within the Community Facilities District for the repayment of the Bonds;

10. A certificate dated the Closing Date from Spicer Consulting Group, LLC (the "Special Tax Consultant") addressed to the Community Facilities District and the Underwriter to the effect that: (i) the Special Tax if collected in the maximum amounts permitted pursuant to the Rate and Method of Apportionment of Special Taxes of the Community Facilities District as of the Closing Date would generate at least 110% of the annual debt service payable with respect to the Bonds and 2023 Bonds plus budgeted administrative expenses in each year, based on such assumptions and qualifications as shall be acceptable to the Underwriter; and (ii) the statements in the Official Statement provided by the Special Tax Consultant concerning Special Taxes in the Community Facilities District and all information supplied by it for use in the Official Statement were as of the date of the Official Statement and are as of the Closing Date true and correct, and do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading;

11. Certified copies of the general resolution of the Trustee authorizing the execution and delivery of certain documents by certain officers of the Trustee, which resolution authorizes the execution of the Indenture and the authentication of the Bonds;

12. A certificate of the Trustee, addressed to the Underwriter, and the Community Facilities District dated the Closing Date, to the effect that: (i) the Trustee is authorized to carry out corporate trust powers, and have full power and authority to perform its duties under the 13

Indenture; (ii) the Trustee is duly authorized to execute and deliver the Indenture, to accept the obligations created by the Indenture and to authenticate the Bonds pursuant to the terms of the Indenture; (iii) no consent, approval, authorization or other action by any governmental or regulatory authority having jurisdiction over the Trustee that has not been obtained is or will be required for the authentication of the Bonds or the consummation by the Trustee of the other transactions contemplated to be performed by the Trustee in connection with the authentication of the Bonds and the acceptance and performance of the obligations created by the Indenture; and (iv) to the best of its knowledge, compliance with the terms of the Indenture will not conflict with, or result in a violation or breach of, or constitute a default under, any loan agreement, indenture, bond, note, resolution or any other agreement or instrument to which the Trustee is a party or by which it is bound, or any law or any rule, regulation, order or decree of any court or governmental agency or body having jurisdiction over the Trustee or any of its activities or properties;

13. An opinion of counsel to the Trustee dated the Closing Date, addressed to the Underwriter, and the Community Facilities District to the effect that the Trustee is a national banking association duly organized and validly existing under the laws of the United States having full power and being qualified to enter into, accept and agree to the provisions of the Indenture, and that such documents have been duly authorized, executed and delivered by the Trustee, and, assuming due execution and delivery by the other parties thereto, constitutes the legal, valid and binding obligation of the Trustee, enforceable in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by the application of equitable principles if equitable remedies are sought;

14. A certificate of the Community Facilities District dated the Closing Date, in a form acceptable to Bond Counsel and the Underwriter, that the Bonds are not arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended;

15. A Letter of Representations of Tri Pointe Homes IE-SD, Inc. (the "Developer") in connection with the printing of the Preliminary Official Statement dated the date of the Preliminary Official Statement, substantially in the form attached as part of Exhibit D hereto or as such Letter of Representations may be modified with the approval of the Underwriter and Bond Counsel, and a Closing Certificate of the Developer dated the Closing Date, substantially in the form attached as part of Exhibit D hereto;

16. An opinion or opinions of counsel to the Developer, dated the date of the Closing addressed to the Community Facilities and the Underwriter, in form and substance acceptable to the Underwriter and Bond Counsel.

17. An opinion of Kutak Rock LLP, counsel to the Underwriter ("Underwriter's Counsel"), dated the date of Closing and addressed to the Underwriter in form and substance acceptable to the Underwriter; and

18. A certificate in form and substance as set forth in Exhibit C hereto of Integra Realty Resources, Rocklin, California, the appraiser of the property within the Community Facilities District, dated as of the Closing Date.

19. A parity certificate executed by the Community Facilities District relating to the issuance of the Bonds as additional parity bonds as required by the Indenture. 14

20. Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Closing Date, of the material representations and warranties of the Community Facilities District contained herein, and of the statements and information contained in the Official Statement and the due performance or satisfaction by the Community Facilities District at or prior to the Closing of all agreements then to be performed and all conditions then to be satisfied by the Community Facilities District in connection with the transactions contemplated hereby and by the Indenture and the Official Statement.

If the Community Facilities District shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds contained in this Purchase Agreement, or if the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement shall terminate and neither the Community Facilities District nor the Underwriter shall be under any further obligation hereunder, except that the respective obligations of the Underwriter and the Community Facilities District set forth in Section 5 hereof shall continue in full force and effect.

4. Establishment of Issue Price.

A. The Underwriter agrees to assist the Community Facilities District in establishing the issue price of the Bonds and shall execute and deliver to the Community Facilities District at Closing an "issue price" or similar certificate, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit B, with such modifications as may be appropriate or necessary, in the reasonable judgment of the Underwriter, the Community Facilities District and Bond Counsel, to accurately reflect, as applicable, the sales price or prices or the initial offering price or prices to the public of the Bonds.

B. Except as otherwise set forth in Exhibit A attached hereto, the Community Facilities District will treat the first price at which 10% of each maturity of the Bonds (the "10% test") is sold to the public as the issue price of that maturity (if different interest rates apply within a maturity, each separate CUSIP number within that maturity will be subject to the 10% test). At or promptly after the execution of this Purchase Agreement, the Underwriter shall report to the Community Facilities District the price or prices at which it has sold to the public each maturity of Bonds. If at that time the 10% test has not been satisfied as to any maturity of the Bonds, the Underwriter agrees to promptly report to the Community Facilities District the prices at which it sells the unsold Bonds of that maturity to the public. That reporting obligation shall continue, whether or not the Closing Date has occurred, until the 10% test has been satisfied as to the Bonds of that maturity or until all Bonds of that maturity have been sold to the public.

C. The Underwriter confirms that it has offered the Bonds to the public on or before the date of this Purchase Agreement at the offering price or prices (the "initial offering price"), or at the corresponding yield or yields, set forth in Exhibit A attached hereto, except as otherwise set forth therein. Exhibit A also sets forth, as of the date of this Purchase Agreement, the maturities, if any, of the Bonds for which the Underwriter represents that (i) the 10% test has been satisfied (assuming orders are confirmed by the close of the business day immediately following the date of this Purchase Agreement) and (ii) the 10% test has not been satisfied and for which the Community Facilities District and the Underwriter agree that the restrictions set forth in the next sentence shall apply, which will allow the Community Facilities District to treat the initial offering price to the public of each such maturity as of the sale date as the issue price of that maturity (the 15