SUBSCRIPTION ESCROW AGREEMENT

THIS SUBSCRIPTION ESCROW AGREEMENT dated as of October 11, 2013 (this
“Agreement”), is entered into among International Assets Advisory, LLC (the
“Dealer Manager”), Preferred Apartment Communities, Inc. (the “Company”) and UMB
Bank, National Association, a national banking association, as escrow agent (the
“Escrow Agent”).

WHEREAS, the Company intends to raise cash funds from Investors (as defined
below) pursuant to a public offering (the “Offering”) of up to 900,000 units,
having a purchase price of $1,000 per unit (for an aggregate offering amount of
$900,000,000), consisting of (i) 900,000 shares of Series A Redeemable Preferred
Stock, par value $0.01 per share, and (ii) warrants to purchase 18,000,000
shares of common stock, par value $0.01 per share, of the Company (collectively,
the “Securities”), pursuant to the registration statement on Form S-3 of the
Company (No. 333- 183355) (as amended, the “Offering Document”).

WHEREAS, the Escrow Agent is willing to accept appointment as escrow agent only
for the express duties set forth herein.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements contained herein, the parties hereto, intending to be legally
bound, hereby agree as follows:

1.     Proceeds to be Escrowed. On or before the date the Offering Document is
declared effective by the Securities and Exchange Commission, the Company shall
establish an escrow account with the Escrow Agent to be invested in accordance
with Section 7 entitled “ESCROW ACCOUNT FOR THE BENEFIT OF INVESTORS OF UNITS OF
PREFERRED APARTMENT COMMUNITIES, INC.” (including such abbreviations as are
required for the Escrow Agent’s systems) (the “Escrow Account”). All checks,
wire transfers and other funds received from subscribers of Securities via
“Direct Registration Settlement” (as described in the Offering
Document)(“Investors”) in payment for the Securities (“Investor Funds”) will be
delivered to the Escrow Agent within one business day following the day upon
which such Investor Funds are received by the Company or its agents, and shall,
upon receipt by the Escrow Agent, be retained in escrow by the Escrow Agent.
During the term of this Agreement, the Company or its agents shall cause all
checks received by and made payable to it for payment for the Securities to be
endorsed in favor of the Escrow Agent and delivered to the Escrow Agent for
deposit in the Escrow Account.

The initial escrow period shall commence upon the effectiveness of this
Agreement and shall continue until the earliest to occur of: (a) the close of
business on October 11, 2015, or October 11, 2016 if the Offering is extended to
such date by the Company; (b) the date all Securities offered pursuant to the
Offering Document are sold, (c) the date the Escrow Agent receives written
notice from the Company that it is abandoning the sale of the Securities; and
(d) the date the Escrow Agent receives notice from the Securities and Exchange
Commission or any other federal or state regulatory authority that a stop or
similar order has been issued with respect to the Offering Document and has
remained in effect for at least 20 days. The Escrow Account shall not be an
interest-bearing account.

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The Escrow Agent shall have no duty to make any disbursement, investment or
other use of Investor Funds until and unless it has good and collected funds. If
any checks deposited in the Escrow Account are returned or prove uncollectible
after the funds represented thereby have been released by the Escrow Agent, then
the Company shall promptly reimburse the Escrow Agent for any and all costs
incurred for such, upon request, and the Escrow Agent shall deliver the returned
checks to the Company. The Escrow Agent shall be under no duty or responsibility
to enforce collection of any check delivered to it hereunder.

2.     Investors. Investors will be instructed by the Dealer Manager or any
soliciting dealers retained by the Dealer Manager (the “Soliciting Dealers”) to
remit the purchase price in the form of checks ( “instruments of payment”)
payable to the order of, or funds wired in favor of, “UMB BANK, N.A., ESCROW
AGENT FOR PREFERRED APARTMENT COMMUNITIES, INC.” Any checks made payable to a
party other than the Escrow Agent shall be returned to the Dealer Manager or
Soliciting Dealer that submitted the check.

If any subscription agreement for the purchase of Securities solicited by a
Soliciting Dealer is rejected by the Company, then the subscription agreement
and check for the purchase of Securities will be returned to the rejected
subscriber within ten business days from the date of rejection.

All Investor Funds deposited in the Escrow Account shall not be subject to any
liens or charges by the Company or the Escrow Agent, or judgments or creditors’
claims against the Company, until and unless released to the Company as
hereinafter provided. The Company understands and agrees that the Company shall
not be entitled to any Investor Funds on deposit in the Escrow Account and no
such funds shall become the property of the Company, or any other entity except
as released to the Company pursuant to Section 3. The Escrow Agent will not use
the information provided to it by the Company for any purpose other than to
fulfill its obligations as Escrow Agent hereunder. The Escrow Agent will treat
all Investor information as confidential.

3.     Disbursement of Funds. The Escrow Agent, upon receipt of Escrow Release
Notices, shall periodically transfer any portion of the Investor Funds to the
Company or such other parties as set forth in the applicable Escrow Release
Notice. The Escrow Agent shall effect such transfer by the close of business on
the date the Escrow Agent receives the applicable Escrow Release Notice;
provided, however, if the Escrow Agent receives the applicable Escrow Release
Notice after 2pm Central Time, then the Escrow Agent shall effect such transfer
by the close of business on the next succeeding business day.

4.    Term of Escrow. The “Termination Date” shall be the earliest of: (a) the
close of business on October 11, 2015, or October 11, 2016 if the Offering is
extended to such date by the Company; (b) (b) the date all the Securities
offered pursuant to the Offering Document are sold, (c) all funds held in the
Escrow Account are distributed to the Company or to Investors pursuant to
Section 3 and the Company has informed the Escrow Agent in writing to close the
Escrow Account; (d) the date the Escrow Agent receives written notice from the
Company that it is abandoning the sale of the Securities; and (e) the date the
Escrow Agent receives notice from the Securities and Exchange Commission or any
other federal or state regulatory authority that a

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stop or similar order has been issued with respect to the Offering Document and
has remained in effect for at least 20 days. After the Termination Date, the
Company and its agents shall not deposit, and the Escrow Agent shall not accept,
any additional amounts representing payments by prospective Investors.

5.     Duty and Liability of the Escrow Agent. The sole duty of the Escrow Agent
shall be to receive Investor Funds and subscription agreements and hold them
subject to release, in accordance herewith, and the Escrow Agent shall be under
no duty to determine whether the Company, the Dealer Manager or any Soliciting
Dealer is complying with requirements of this Agreement, the Offering or
applicable securities or other laws in tendering the Investor Funds to the
Escrow Agent. No other agreement entered into between the parties, or any of
them, shall be considered as adopted or binding, in whole or in part, upon the
Escrow Agent notwithstanding that any such other agreement may be referred to
herein or deposited with the Escrow Agent or the Escrow Agent may have knowledge
thereof, including specifically but without limitation the Offering Document or
any other document related to the Offering (including the subscription agreement
and exhibits thereto), and the Escrow Agent’s rights and responsibilities shall
be governed solely by this Agreement. The Escrow Agent shall not be responsible
for or be required to enforce any of the terms or conditions of the Offering
Document or any other document related to the Offering (including the
subscription agreement and exhibits thereto) or other agreement between the
Company and any other party. The Escrow Agent may conclusively rely upon and
shall be protected in acting upon any statement, certificate, notice, request,
consent, order or other document believed by it to be genuine and to have been
signed or presented by the proper party or parties. The Escrow Agent shall have
no duty or liability to verify any such statement, certificate, notice, request,
consent, order or other document, and its sole responsibility shall be to act
only as expressly set forth in this Agreement. Concurrent with the execution of
this Agreement, the Company and the Dealer Manager shall each deliver to the
Escrow Agent an authorized signers form in the form of Exhibit A or Exhibit A-1
to this Agreement, as applicable. The Escrow Agent shall be under no obligation
to institute or defend any action, suit or proceeding in connection with this
Agreement unless first indemnified to its satisfaction. The Escrow Agent may
consult counsel of its own choice with respect to any question arising under
this Agreement and the Escrow Agent shall not be liable for any action taken or
omitted in good faith upon advice of such counsel. The Escrow Agent shall not be
liable for any action taken or omitted by it in good faith except to the extent
that a court of competent jurisdiction determines that the Escrow Agent’s gross
negligence or willful misconduct was the primary cause of loss. The Escrow Agent
is acting solely as escrow agent hereunder and owes no duties, covenants or
obligations, fiduciary or otherwise, to any other person by reason of this
Agreement, except as otherwise stated herein, and no implied duties, covenants
or obligations, fiduciary or otherwise, shall be read into this Agreement
against the Escrow Agent.  If any disagreement between any of the parties to
this Agreement, or between any of them and any other person, including any
Investor, resulting in adverse claims or demands being made in connection with
the matters covered by this Agreement, or if the Escrow Agent is in doubt as to
what action it should take hereunder, the Escrow Agent may, at its option,
refuse to comply with any claims or demands on it, or refuse to take any other
action hereunder, so long as such disagreement continues or such doubt exists,
and in any such event, the Escrow Agent shall not be or become liable in any way
or to any person for its failure or refusal to act, and the Escrow Agent shall
be entitled to continue so to refrain from acting until (a) the rights of all
interested parties shall have been fully and finally adjudicated by a court of
competent jurisdiction, or (b)

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all differences shall have been adjudged and all doubt resolved by agreement
among all of the interested persons, and the Escrow Agent shall have been
notified thereof in writing signed by all such persons. Notwithstanding the
foregoing, the Escrow Agent may in its discretion obey the order, judgment,
decree or levy of any court, whether with or without jurisdiction and the Escrow
Agent is hereby authorized in its sole discretion to comply with and obey any
such orders, judgments, decrees or levies. If any controversy should arise with
respect to this Agreement the Escrow Agent shall have the right, at its option,
to institute an interpleader action in any court of competent jurisdiction to
determine the rights of the parties. IN NO EVENT SHALL THE ESCROW AGENT BE
LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL
LOSSES OR DAMAGES OF ANY KIND WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST
PROFITS), EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
LOSSES OR DAMAGES AND REGARDLESS OF THE FORM OF ACTION. The parties hereto agree
that the Escrow Agent has no role in the preparation of the Offering Document
(including the subscription agreement and other exhibits thereto) and makes no
representations or warranties with respect to the information contained therein
or omitted therefrom. The Escrow Agent shall have no obligation, duty or
liability with respect to compliance with any federal or state securities,
disclosure or tax laws concerning the Offering Document or any other document
related to the Offering (including the subscription agreement and other exhibits
thereto) or the issuance, offering or sale of the Securities. The Escrow Agent
shall have no duty or obligation to monitor the application and use of the
Investor Funds once transferred to the Company, that being the sole obligation
and responsibility of the Company.

6.     Escrow Agent’s Fee. The Escrow Agent shall be entitled to compensation
for its services as stated in the fee schedule attached hereto as Exhibit B,
which compensation shall be paid by the Company. The fee agreed upon for the
services rendered hereunder is intended as full compensation for the Escrow
Agent’s services as contemplated by this Agreement; provided, however, that if
(a) the conditions for the disbursement of funds under this Agreement are not
fulfilled, (b) the Escrow Agent renders any material service not contemplated in
this Agreement, (c) there is any assignment of interest in the subject matter of
this Agreement, (d) there is any material modification hereof, (e) any material
controversy arises hereunder, or (f) the Escrow Agent is made a party to any
litigation pertaining to this Agreement or the subject matter hereof, then the
Escrow Agent shall be reasonably compensated for such extraordinary services and
reimbursed for all costs and expenses, including reasonable attorney’s fees,
occasioned by any delay, controversy, litigation or event, and the same shall be
recoverable from the Company. The Company’s obligations under this Section 6
shall survive the resignation or removal of the Escrow Agent and the assignment
or termination of this Agreement.

7.    Investment of Investor Funds. Investor Funds shall be deposited in the
Escrow Account in accordance with Section 1 and held uninvested in the Escrow
Account, which shall be non-interest bearing.

8.     Notices. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed to have been duly given
(a) on the date of service if served personally on the party to whom notice is
to be given, (b) on the day of transmission if sent by facsimile/email
transmission bearing an authorized signature to the facsimile number/email
address given below, and written confirmation of receipt is obtained

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promptly after completion of transmission, (c) on the day after delivery to
Federal Express or similar overnight courier or the Express Mail service
maintained by the United States Postal Service, or (d) on the fifth day after
mailing, if mailed to the party to whom notice is to be given, by first class
mail, registered or certified, postage prepaid, and properly addressed, return
receipt requested, to the party as follows:

If to the Company:
 
Preferred Apartment Communities, Inc.
3625 Cumberland Boulevard, Suite 1150
Atlanta, Georgia 30339
Fax: (770) 818-4105
Attention: John A. Williams, Chief Executive Officer
Attention: Jeffrey Sprain, General Counsel and Secretary

with a copy to:

Proskauer Rose LLP
Eleven Times Square
New York, New York 10036
Fax: (212) 969-2900
Attention: Peter M. Fass, Esq.
James P. Gerkis, Esq.

If to the Dealer Manager:

International Assets Advisory, LLC
300 South Orange Ave., Suite 1100
Orlando, Florida 32801
Fax: (407) 254-1500
Attention: Ed Cofrancesco

with a copy to:

Foley & Lardner, LLP
100 North Tampa Street
Suite 2700
Tampa, Florida 33602
Fax: (813) 221-4210
Attention: Martin Traber, Esq.
Steven Vasquez, Esq.

If to Escrow Agent:

UMB Bank, National Association

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1010 Grand Blvd. 4th Floor
Mail Stop: 1020409
Kansas City, Missouri 64106
Attention: Lara Stevens, Corporate Trust
Telephone: (816) 860-3017
Fax: (816) 860-3029
Email: lara.stevens@umb.com

Any party may change its address for purposes of this Section by giving the
other party written notice of the new address in the manner set forth above.

9.     Indemnification of Escrow Agent. The Company and the Dealer Manager
hereby agree to, jointly and severally, indemnify, defend and hold harmless the
Escrow Agent from and against, any and all losses, liabilities, costs, damages
and expenses, including, without limitation, reasonable counsel fees and
expenses, which the Escrow Agent may suffer or incur by reason of any action,
claim or proceeding brought against the Escrow Agent arising out of or relating
in any way to this Agreement or any transaction to which this Agreement relates
unless such loss, liability, cost, damage or expense is finally determined by a
court of competent jurisdiction to have been primarily caused by the gross
negligence or willful misconduct of the Escrow Agent. The terms of this Section
shall survive the termination of this Agreement and the resignation or removal
of the Escrow Agent.

10.     Successors and Assigns. Except as otherwise provided in this Agreement,
no party hereto shall assign this Agreement or any rights or obligations
hereunder without the prior written consent of the other parties hereto and any
such attempted assignment without such prior written consent shall be void and
of no force and effect. This Agreement shall inure to the benefit of and shall
be binding upon the successors and permitted assigns of the parties hereto. Any
corporation or association into which the Escrow Agent may be converted or
merged, or with which it may be consolidated, or to which it may sell or
transfer all or substantially all of its corporate trust business and assets as
a whole or substantially as a whole, or any corporation or association resulting
from any such conversion, sale, merger, consolidation or transfer to which the
Escrow Agent is a party, shall be and become the successor Escrow Agent under
this Agreement and shall have and succeed to the rights, powers, duties,
immunities and privileges as its predecessor, without the execution or filing of
any instrument or paper or the performance of any further act.

11.     Governing Law; Jurisdiction. This Agreement shall be construed,
performed, and enforced in accordance with, and governed by, the internal laws
of the State of New York, without giving effect to the principles of conflicts
of laws thereof.

12.     Severability. If any provision of this Agreement is declared by any
court or other judicial or administrative body to be null, void, or
unenforceable, said provision shall survive to the extent it is not so declared,
and all of the other provisions of this Agreement shall remain in full force and
effect.

13.     Amendments; Waivers. This Agreement may be amended or modified, and any
of the terms, covenants, representations, warranties, or conditions hereof may
be waived, only by a

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written instrument executed by the parties hereto, or in the case of a waiver,
by the party waiving compliance. Any waiver by any party of any condition, or of
the breach of any provision, term, covenant, representation, or warranty
contained in this Agreement, in any one or more instances, shall not be deemed
to be nor construed as further or continuing waiver of any such condition, or of
the breach of any other provision, term, covenant, representation, or warranty
of this Agreement. The Company and the Dealer Manager agree that any requested
waiver, modification or amendment of this Agreement shall be consistent with the
terms of the Offering.

14.     Entire Agreement. This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the escrow contemplated
hereby and supersedes and replaces all prior and contemporaneous agreements and
understandings, oral or written, with regard to such escrow.

15.     Section Headings. The section headings in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.

16.     Counterparts. This Agreement may be executed (including by facsimile
transmission) with counterpart signature pages or in counterparts, each of which
shall be deemed an original, but all of which shall constitute the same
instrument.

17.     Resignation. The Escrow Agent may resign upon 30 days’ advance written
notice to the parties hereto. If a successor escrow agent is not appointed by
the Company within the 30-day period following such notice, the Escrow Agent may
petition any court of competent jurisdiction to name a successor escrow agent,
or may interplead the Investor Funds with such court, whereupon the Escrow
Agent’s duties hereunder shall terminate.

18.    References to Escrow Agent. Other than the Offering Document, any of the
other documents related to the Offering (including the subscription agreement
and exhibits thereto) and any amendments thereof or supplements thereto, no
printed or other matter in any language (including, without limitation, notices,
reports and promotional material) which mentions the Escrow Agent’s name or the
rights, powers, or duties of the Escrow Agent shall be issued by the Company or
the Dealer Manager, or on the Company’s or the Dealer Manager’s behalf, unless
the Escrow Agent shall first have given its specific written consent thereto.
Notwithstanding the foregoing, any amendment or supplement to the Offering
Document or any other document related to the Offering (including the
subscription agreement and exhibits thereto) that revises, alters, modifies,
changes or adds to the description of the Escrow Agent or its rights, powers or
duties hereunder shall not be issued by the Company or the Dealer Manager, or on
the Company’s or the Dealer Manager’s behalf, unless the Escrow Agent has first
given specific written consent thereto.

19.    Patriot Act Compliance. The Company shall provide to the Escrow Agent
upon the execution of this Agreement any documentation requested and any
information reasonably requested by the Escrow Agent to comply with the USA
Patriot Act of 2001, as amended from time to time.

[Signature page follows.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
the date and year first set forth above.

PREFERRED APARTMENT COMMUNITIES, INC.

By:
/s/ John A. Williams
 
 
Name:
John A. Williams
 
 
Title:
Chief Executive Officer
 

INTERNATIONAL ASSETS ADVISORY, LLC

By:
/s/ Ed Cofrancesco
 
 
Name:
Ed Confrancesco
 
 
Title:
President
 

UMB BANK, NATIONAL
ASSOCIATION, as Escrow Agent

By:
/s/ Lara L. Stevens
 
 
Name:
 Lara L. Stevens
 
 
Title:
 Vice President
 

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Exhibit A

CERTIFICATE AS TO AUTHORIZED SIGNATURES

Account Name:    

Account Number:    
The specimen signatures shown below are the specimen signatures of the
individuals who have been designated as Authorized Representatives of Preferred
Apartment Communities, Inc. and are authorized to initiate and approve
transactions of all types for the above-mentioned account on behalf of Preferred
Apartment Communities, Inc.

Name/Title
 
 
Specimen Signature
John A. Williams
Chief Executive Officer
_______________________________
Signature
 
 
Leonard A. Silverstein
President and Chief Operating Officer
_______________________________
Signature
 
 
Michael J. Cronin
Executive Vice President, Chief Accounting Officer and Treasurer

_______________________________
Signature
 
 
William F. Leseman
Executive Vice President – Property Management
_______________________________
Signature
 
 
Jeffrey R. Sprain
General Counsel and Secretary
_______________________________
Signature

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Exhibit A-1

CERTIFICATE AS TO AUTHORIZED SIGNATURES

Account Name:    

Account Number:    
The specimen signatures shown below are the specimen signatures of the
individuals who have been designated as Authorized Representatives of
International Assets Advisory, LLC and are authorized to initiate and approve
transactions of all types for the above-mentioned account on behalf of
International Assets Advisory, LLC.

Name/Title
 
 
Specimen Signature
Ed Cofrancesco
President
_______________________________
Signature
 
 
Sheri Cuff
Chief Operating Officer
_______________________________
Signature
 
 
Ann A. Moore
Chief Compliance Officer
_______________________________
Signature

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Exhibit B

ESCROW FEES AND EXPENSES

Annual Fee
Annual Escrow Agent                        $3,000

Transactional Fees, if applicable
Outgoing Wire Transfer                    $15 each
Daily Recon File to Transfer Agent                $2.50 per Business Day
Web Exchange Access                    $60 per month
Overnight Delivery/Mailings                    $16.50 each
IRS Tax Reporting                        $10 per 1099
Annual Fee will be payable upon the effectiveness of this agreement.
Transactional fees, if any, will be billed quarterly in arrears. Other fees and
expenses will be billed as incurred.
Fees specified are for the regular, routine services contemplated by this
Agreement, and any additional or extraordinary services, including, but not
limited to disbursements involving a dispute or arbitration, or administration
while a dispute, controversy or adverse claim is in existence, will be charged
based upon time required at the then standard hourly rate.

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Exhibit C

FORM OF ESCROW RELEASE NOTICE

Date:                 

UMB Bank, National Association
1010 Grand Blvd. 4th Floor
Mail Stop: 1020409
Kansas City, Missouri 64106

Ladies and Gentlemen:

In accordance with the terms of Section 3 of the Subscription Escrow Agreement
dated as of October 11, 2013 (as the same may be amended from time to time,
the “Escrow Agreement”), among Preferred Apartment Communities, Inc. (the
“Company”), International Assets Advisory, LLC (the “Dealer Manager”) and UMB
Bank, National Association (the “Escrow Agent”), the Company and the Dealer
Manager hereby notify the Escrow Agent that the ________ closing will be held on
___________ for gross proceeds of $_________.

PLEASE DISTRIBUTE FUNDS BY WIRE TRANSFER (or as indicated) AS FOLLOWS
(wire instructions attached):

$
$

Very truly yours,

PREFERRED APARTMENT COMMUNITIES, INC.,
as the Company

By:                            
    Name:                        
    Title:                        

INTERNATIONAL ASSETS ADVISORY, LLC,
as the Dealer Manager

By:                            
    Name:                        

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Title:                        

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