<PAGE>
                                                                    EXHIBIT 10.3

                                 LEASE AGREEMENT

                   EDUCATION REALTY OPERATING PARTNERSHIP, LP
                         A DELAWARE LIMITED PARTNERSHIP

                                    LANDLORD

                                       AND

                          PLACE PORTFOLIO LESSEE, LLC,
                       A GEORGIA LIMITED LIABILITY COMPANY

                                     TENANT

                              AS OF JANUARY 1, 2006

<PAGE>

                                Table of Contents

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
ARTICLE 1 DEFINITIONS....................................................     1
ARTICLE 2 LEASED PROPERTY AND TERM.......................................     7
   2.1     Leased Property...............................................     7
   2.2     Fixed Term....................................................     7
   2.3     Extension Rights..............................................     8
   2.4     Landlord's Early Termination Rights...........................     9
   2.5     Tenant's Early Termination Right..............................    10
   2.6     No Other Termination..........................................    11
ARTICLE 3 RENT...........................................................    11
   3.1     Rental Payments...............................................    11
   3.2     Base Rent.....................................................    12
   3.3     Adjustments to Base Rent......................................    13
   3.4     Additional Rent...............................................    13
   3.5     Additional Charges............................................    16
   3.6     Monthly Impounds..............................................    17
   3.7     Late Payment of Rent, etc.....................................    18
   3.8     Net Lease.....................................................    18
   3.9     Letter of Credit..............................................    18
ARTICLE 4 CONDITION AND USE OF LEASED PROPERTY...........................    22
   4.1     Condition of the Leased Property..............................    22
   4.2     Permitted Uses................................................    22
   4.3     Compliance with Legal and Insurance Requirements..............    22
   4.4     Lawful Use, Etc...............................................    22
   4.5     Environmental Matters.........................................    23
   4.6     Mold..........................................................    24
ARTICLE 5 MAINTENANCE AND REPAIRS........................................    24
   5.1     Tenant's General Obligations..................................    24
   5.2     Capital Repairs and Replacements..............................    24
   5.3     Conditions to Capital Expenditure Reimbursements..............    26
   5.4     Additional Provisions Relating to Capital Repairs and
              Replacements...............................................    28
ARTICLE 6 INTENTIONALLY OMITTED..........................................    29
ARTICLE 7 LIENS..........................................................    29
ARTICLE 8 PERMITTED CONTESTS.............................................    30
ARTICLE 9 INSURANCE......................................................    30
   9.1     General Insurance Requirements................................    30
   9.2     Additional Insurance..........................................    34
   9.3     Waiver of Subrogation.........................................    34
   9.4     Form of Insurance.............................................    34
   9.5     Increase in Limits............................................    35
   9.6     No Separate Insurance.........................................    35
ARTICLE 10 CASUALTY......................................................    35
   10.1    Insurance Proceeds............................................    35
   10.2    Damage or Destruction.........................................    36
</TABLE>


                                       -i-

<PAGE>

                                Table of Contents

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
   10.3    Disbursement of Proceeds......................................    37
   10.4    No Abatement of Rent..........................................    38
   10.5    Damage Near End of Term.......................................    38
   10.6    Waiver........................................................    38
ARTICLE 11 CONDEMNATION..................................................    38
   11.1    Definitions...................................................    38
   11.2    Total Condemnation, etc.......................................    39
   11.3    Partial Condemnation..........................................    39
   11.4    Abatement of Rent.............................................    40
   11.5    Temporary Condemnation........................................    40
   11.6    Allocation of Award...........................................    41
ARTICLE 12 DEFAULT.......................................................    41
   12.1    Events of Default.............................................    41
   12.2    Remedies......................................................    43
   12.3    Additional Expenses...........................................    45
   12.4    Waiver........................................................    45
   12.5    Application of Funds..........................................    45
   12.6    Notices.......................................................    45
   12.7    Remedies Cumulative...........................................    45
   12.8    Landlord's Default............................................    45
ARTICLE 13 SUBLETTING AND ASSIGNMENT.....................................    46
ARTICLE 14 FINANCIAL STATEMENTS AND OTHER CERTIFICATES...................    50
   14.1    Estoppel Certificates.........................................    50
   14.2    Financial Statements and Officer's Certificates...............    50
   14.3    Maintenance of Accounts and Records...........................    52
   14.4    Right of Inspection...........................................    52
   14.5    Landlord Securities Offering and Filings......................    52
ARTICLE 15 FINANCING OF THE LEASED PROPERTY..............................    52
   15.1    Financing by Landlord.........................................    52
   15.2    Subordination of Lease........................................    52
   15.3    Notice to Mortgagee...........................................    53
   15.4    Existing Mortgage Loan........................................    54
ARTICLE 16 ADDITIONAL AGREEMENTS OF TENANT...............................    56
   16.1    Representations and Warranties................................    56
   16.2    Single Purpose Entity.........................................    57
   16.3    Organizational Documents......................................    57
   16.4    Notice of Litigation, Etc.....................................    58
   16.5    Indebtedness of Tenant........................................    58
   16.6    Financial Condition of Tenant.................................    58
   16.7    Distributions.................................................    58
   16.8    Prohibited Transactions.......................................    58
   16.9    Competitive Developments......................................    58
   16.10   Subleasing....................................................    59
   16.11   Management Agreement..........................................    59
</TABLE>


                                      -ii-

<PAGE>

                                Table of Contents

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
   16.12   Material Agreements...........................................    60
   16.13   Use of Place Trademark........................................    60
ARTICLE 17 INDEMNIFICATION...............................................    60
ARTICLE 18 BROKERAGE.....................................................    61
ARTICLE 19 SURRENDER; HOLDING OVER.......................................    61
   19.1    Surrender.....................................................    61
   19.2    Holding Over..................................................    62
   19.3    Cooperation...................................................    62
ARTICLE 20 TRANSFERS BY LANDLORD.........................................    63
   20.1    Sale Restriction..............................................    63
   20.2    Sales - General...............................................    63
ARTICLE 21 QUIET ENJOYMENT...............................................    64
   21.1    Quiet Enjoyment...............................................    64
ARTICLE 22 NOTICES.......................................................    64
   22.1    Notices.......................................................    64
ARTICLE 23 MISCELLANEOUS.................................................    65
   23.1    General.......................................................    65
   23.2    Agreement of Principals.......................................    65
   23.3    Entire Agreement; Modifications...............................    66
   23.4    Non-Recourse as to Landlord...................................    66
   23.5    Limitation on Liability of Tenant Related Parties.............    66
   23.6    Counterparts..................................................    66
   23.7    No Waiver.....................................................    66
   23.8    Surrender.....................................................    67
   23.9    No Merger of Title............................................    67
   23.10   Applicable Law, etc...........................................    67
   23.11   Covenants Binding.............................................    67
   23.12   Headings......................................................    67
   23.13   Relationship of the Parties...................................    67
   23.14   Attorneys' Fees...............................................    68
   23.15   Time..........................................................    68
   23.16   Survival......................................................    68
ARTICLE 24 MEMORANDUM OF LEASE...........................................    68
   24.1    Memorandum....................................................    68
ARTICLE 25 ARBITRATION...................................................    68
</TABLE>

EXHIBITS

Exhibit A   Property Descriptions
Exhibit B   Allocation of Base Rent
Exhibit C   Form of Letter of Credit
Exhibit D   Intentionally Omitted
Exhibit E   Form of Officer's Certificate
Exhibit F   Agreement of Principals


                                      -iii-

<PAGE>

                                 LEASE AGREEMENT

     THIS LEASE AGREEMENT (this "Lease"), made and entered into this 5th day of
January, 2006, but effective as of 12:01 a.m. on January 1, 2006, is between
EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership
("Landlord"), and PLACE PORTFOLIO LESSEE, LLC, a Georgia limited liability
company ("Tenant").

                                   WITNESSETH:

     WHEREAS, Landlord holds a leasehold interest in the Leased Property (this
and other capitalized terms used and not otherwise defined herein having the
meanings ascribed to such terms in Article 1); and

     WHEREAS, Landlord desires to sublease the Leased Property to Tenant, and
Tenant desires to sublease the Leased Property from Landlord, on the terms and
conditions herein set forth.

     NOW THEREFORE, for and in consideration of the premises, the covenants and
representations herein made and other good and valuable consideration, the
receipt, adequacy and sufficiency of which are hereby acknowledged, Landlord and
Tenant do hereby agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

     For all purposes of this Lease, except as otherwise expressly provided or
unless the context otherwise requires, (a) the terms defined in this Article
have the meanings assigned to them in this Article and include the plural as
well as the singular, (b) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with GAAP as at the time applicable,
(c) all references in this Lease to designated "Articles", "Sections" and other
subdivisions are to the designated Articles, Sections and other subdivisions of
this Lease, and (d) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Lease as a whole and not to any particular
Article, Section or other subdivision:

     Additional Charges: As defined in Section 3.5.

     Additional Rent: As defined in Section 3.4.

     Additional Rent Base: As defined in Section 3.4.

     Additional Rent Year: For purposes of this Lease, the annual twelve month
period from August 1 to July 31.

     Affiliate: When used with respect to any corporation, limited liability
company, or partnership, any person, corporation, limited liability company,
partnership or other legal entity, which, directly or indirectly, controls or is
controlled by or is under common control with such corporation, limited
liability company, or partnership. For the purposes of this definition,
"control" (including the correlative meanings of the terms "controlled by" and
"under common control with"), as used with respect to any person, corporation,
limited liability company,

<PAGE>

partnership or other legal entity, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such person, corporation, limited liability company, partnership or
other legal entity, through the ownership of voting securities, partnership
interests or other equity interests, by contract, or otherwise.

     Agreement: This Lease, as it may be amended from time to time as herein
provided.

     Agreement of Principals: As defined in Section 23.2.

     Award: As defined in Section 11.1.

     Base Rent: As defined in Section 3.2.

     Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which money centers in the City of New York, New York are
authorized, or obligated, by law or executive order, to close.

     Capital Expenditure: Any expenditure treated as capital in nature in
accordance with GAAP.

     Cash Collateral: As defined in Section 3.9(h).

     Code: The Internal Revenue Code of 1986, as amended, and, to the extent
applicable, the Treasury Regulations promulgated thereunder, each as from time
to time amended.

     Commencement Date: January 1, 2006.

     Condemnation: As defined in Section 11.1.

     Condemnor: As defined in Section 11.1.

     Consumer Price Index: The Consumer Price Index, all urban consumers, all
items, U.S. City Average, published by the United States Department of Labor,
Bureau of Labor Statistics, in which 1982-1984 equals one hundred (100). If the
Consumer Price Index is discontinued or revised during the Term, such other
governmental index or computation with which it is replaced shall be used in
order to obtain substantially the same result as would be obtained if the
Consumer Price Index had not been discontinued or revised.

     Date of Taking: As defined in Section 11.1.

     Encumbrance: As defined in Article 15.1.

     Entity: Any corporation, general or limited partnership, limited liability
company or partnership, stock company or association, joint venture, trust,
bank, business trust, Governmental Authority, or any other legal entity.

     Event of Default: As defined in Section 12.1.

     Existing Lender: As defined in Section 15.4.

     Existing Loan Agreement. As defined in Section 15.4.

     Existing Mortgage Loan: As defined in Section 15.4.

     Extension Notice: As defined in Section 2.3.

     Extension Term: As defined in Section 2.3.


                                       -2-

<PAGE>

     Financial Officer's Certificate: A certificate of the chief financial
officer of Tenant, accompanying the financial statements required to be
delivered by Tenant pursuant to Section 3.4 and Section 14.2 (i), (ii) and
(iii), in which such officer shall certify that to such officer's best knowledge
such statements have been prepared in accordance with GAAP, are true, correct
and complete in all material respects, and fairly present the financial
condition of Tenant at and as of the dates thereof and the results of its
operations for the periods covered thereby, subject only to normal year-end
audit adjustments, if applicable.

     Fiscal Year: The fiscal year for this Lease shall be the twelve (12) month
period from January 1 to December 31.

     Fixed Term: As defined in Section 2.2.

     Fixtures: As defined in Section 2.1.

     Full Replacement Cost: As defined in Section 9.1.

     GAAP: Generally accepted accounting principles as consistently applied in
the United States and in effect from time to time.

     Governmental Authority: Any federal, state, county, municipal, or other
governmental authority or quasi-governmental authority, commission, agency,
board, office or instrumentality of any nature whatsoever having jurisdiction
over the Leased Property or any portion thereof or the Leased Improvements
operated thereon.

     Greenwich Properties: As defined in Section 15.4(h).

     Gross Rentals: As defined in Section 3.4.

     Hazardous Materials: Any substance which is toxic, explosive, corrosive,
flammable, infectious, radioactive, carcinogenic, or otherwise hazardous and is
or becomes regulated by any Governmental Authority including without limitation,
asbestos or any substance containing asbestos and deemed hazardous under any
Hazardous Materials Law, the group of organic compounds known as polychlorinated
biphenyls, flammable explosives, radioactive materials, lead and lead based
paint, urea formaldehyde foam insulation, radon gas, infectious wastes,
biomedical and medical wastes, chemicals known to cause cancer or reproductive
toxicity, pollutants, effluents, contaminants, emissions or related materials
and any items included in the definition of hazardous or toxic wastes, materials
or substances under any Hazardous Materials Law.

     Hazardous Materials Laws: All local, state and federal laws or rule of
common law, consent order, judicial order, administrative order or other
governmental directive that applies to Tenant or to the Leased Property and
relates to Hazardous Materials including, without limitation, those relating to
industrial hygiene or the use, analysis, generation, manufacture, storage,
discharge, release, disposal, transportation, treatment, investigation, or
remediation of Hazardous Materials, including, without limitation, the Resource
Conservation and Recovery Act of 1976 ("RCRA"), the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 ("CERCLA"), as amended by the
Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Hazardous
Materials Transportation Act, 49 U.S.C. Section 6901, et seq., the Federal Water
Pollution Control Act, 33 U.S.C. Sections 1251 et seq., the Clean Air Act, 42
U.S.C. Sections 741 et seq., the Clean Water Act, 33 U.S.C. Section 7401, et
seq., the Toxic Substances Control Act, 15 U.S.C. Sections 2601-2629, the Safe
Drinking Water Act, 42 U.S.C.


                                       -3-

<PAGE>

Sections 300f-300j, and all similar federal, state and local environmental
statutes, ordinances and the regulations, orders, or decrees now or hereafter
promulgated thereunder.

     Impositions: Collectively, all real property and personal property taxes,
assessments (including, without limitation, all assessments imposed under
instruments which encumber title to the Leased Property and all assessments for
public improvements or benefits to the Leased Property, whether or not commenced
or completed prior to the date hereof and whether or not to be completed within
the Term), water, sewer or other rents and charges, all excises, tax levies,
fees (including, without limitation, license, permit, inspection, authorization
and similar fees), and all other governmental charges, in each case whether
general or special, ordinary or extraordinary, or foreseen or unforeseen, of
every character in respect of the Leased Property and/or the Rent (including all
interest and penalties thereon due to any failure in payment by Tenant), which
at any time prior to, during or in respect of the Term may be assessed or
imposed on or in respect of or be a lien upon (a) Landlord or Landlord's
interest in the Leased Property, (b) the Leased Property or any part thereof or
any rent therefrom or any estate, right, title or interest therein, or (c) any
occupancy, operation, use or possession of, sales from, or activity conducted
on, or in connection with, the Leased Property or the leasing or use of the
Leased Property or any part thereof; provided, however, nothing contained in
this Lease shall be construed to require Tenant to pay (1) any tax based on net
income (whether denominated as a franchise or capital stock, financial
institutions or other tax) imposed on Landlord, or (2) any net revenue tax of
Landlord, or (3) any transfer fee or tax imposed with respect to the subsequent
sale, exchange or other disposition by Landlord of any portion of the Leased
Property or the proceeds thereof, or (4) any principal or interest on any
Encumbrance on the Leased Property.

     Indebtedness: With respect to Tenant, all obligations, contingent or
otherwise, which in accordance with GAAP should be reflected on Tenant's balance
sheet as liabilities.

     Insurance Requirements: All terms of any insurance policy required by this
Lease.

     Interest Rate: An annual interest rate equal to the annual interest rate
announced by Citibank in New York, New York as its prime rate or base rate
(which rate shall change automatically and simultaneously from time to time with
each change in the announced prime rate) plus two percent (2%).

     Land: As defined in Section 2.1(a).

     Landlord: As defined in the Preamble and any permitted successor or assign
thereof.

     Landlord's Notice Address: As defined in Section 22.1.

     Lease: As defined in the Preamble.

     Lease Extension Operating Test: As defined in Section 2.3.

     Lease Year: A twelve (12) consecutive calendar month period falling within
the Term, with the first Lease Year commencing on the Commencement Date and each
subsequent Lease Year commencing on each anniversary of the Commencement Date.

     Leased Improvements: As defined in Section 2.1.

     Leased Property: As defined in Section 2.1.

     Legal Requirements: All federal, state, county, municipal and other
governmental statutes, laws, rules, orders, regulations, ordinances, judgments,
decrees and injunctions affecting


                                       -4-

<PAGE>

Tenant's operation of its business on the Leased Property, the Leased Property
or the construction, use or alteration of the Leased Improvements (including,
without limitation, the Americans With Disabilities Act and Section 504 of the
Rehabilitation Act of 1973) whether now or hereafter enacted and in force,
including any which may (a) require repairs, modifications, or alterations in or
to the Leased Property, or (b) in any way adversely affect the use and enjoyment
thereof, and all permits, licenses, authorizations and regulations relating
thereto, and all covenants, agreements, restrictions and encumbrances contained
in any instruments, either of record or known to Tenant (other than encumbrances
created by Landlord without the consent of Tenant), at any time in force
affecting the Leased Property.

     Letter of Credit: As defined in Section 3.9.

     Management Agreement: Any contracts and agreements entered into by Tenant
for the management of any or all of the Projects.

     Manager: Any person, firm, corporation or other entity or individual
engaged by Tenant to manage any Project pursuant to a Management Agreement.

     Mold. Any microbial or fungus contamination or infestation in the Leased
Improvements of a type and magnitude which poses a risk to human health or the
environment or would materially, negatively impact the value of the Leased
Property, or any portion thereof.

     Net Operating Income: With respect to any period of calculation, determined
on an accrual basis, the excess of (i) all revenues, receipts, and payments of
every kind arising from ownership and operation of the Leased Property,
including all payments of rents from subtenants of the Projects (but excluding
condemnation and insurance proceeds, except to the extent such proceeds are with
respect to rent or business interruption insurance, and excluding tenant
deposits and prepaid rent not actually applied during such period), over (ii)
Operating Expenses attributable to such period of calculation.

     Notice: A notice given in accordance with Section 22.1.

     Officer's Certificate: A certificate of Tenant signed by the Manager, the
President, any Vice President or the Treasurer of Tenant or another officer or
representative authorized to so sign by the governing body of Tenant, or any
other person whose power and authority to act has been authorized by delegation
in writing by any of the persons holding the foregoing offices.

     Operating Expenses: With respect to any period of calculation, all costs
and expenses accrued in accordance with GAAP relating to the operation,
maintenance, repair, use and management of the Leased Property, including,
without limitation, utilities, repairs and maintenance, insurance, property
taxes and assessments, advertising expenses, payroll and related taxes,
equipment lease payments, and management fees equal to the lesser of (a) actual
management fees, or (b) a management fee equal to 3% of gross rentals for such
period, but excluding (i) payments of Base Rent, Additional Rent, and penalties
and interest payable to Landlord under this Lease; (ii) depreciation,
amortization and other non-cash expenses of Tenant with respect to the Leased
Property; (iii) Capital Expenditures to the extent paid by Landlord; (iv) the
cost of providing any Letter of Credit or Additional Letter of Credit to be
provided by Tenant under this Lease; and (v) any fine, penalty, interest, and
cost required to be paid by Tenant as a result of non-payment or late payment of
any Additional Charges required to be paid by Tenant. Operating Expenses shall
also include the amount of any deductible expense incurred by Tenant in
connection with damage or destruction of any Project during the Term.


                                       -5-

<PAGE>

     Organizational Documents: As defined in Section 16.3.

     Overdue Rate: On any date, the rate per annum which is the lesser of (i)
fifteen percent (15%) or (ii) the highest rate allowed by the laws of the State.

     Permitted Use: As defined in Section 4.2.

     Person: Any individual or Entity, and the heirs, executors, administrators,
legal representatives, successors and assigns of such Person where the context
so admits.

     Project: With respect to each individual Property described in Section 2.1,
the student housing oriented residential apartment complex being operated on
such Property.

     Project Mortgage: Any Encumbrance placed upon Landlord's interest in a
Property.

     Project Mortgagee: The holder of any Project Mortgage.

     Property: As defined in Section 2.1.

     Rent: Collectively, the Base Rent, the Additional Rent, and the Additional
Charges.

     Single Purpose Entity: An entity which (i) exists solely for the purpose of
leasing the Leased Property and operating the Projects, (ii) conducts business
only in its own name, (iii) does not engage in any business other than the
operation of the Projects, (iv) does not hold, directly or indirectly, any
ownership interest (legal or equitable) in any entity or any real or personal
property other than the interest in the Leased Property which it leases from
Landlord hereunder, (v) does not have any assets other than those related to its
interest in the Leased Property pursuant to this Lease and does not have any
debt other than as permitted by this Lease and does not guarantee or otherwise
obligate itself with respect to the debts of any other person or entity, (vi)
has its own separate books, records, accounts and financial statements (with no
commingling of funds or assets), (vii) holds itself out as being a company
separate and apart from any other entity, and (viii) observes limited liability
company/partnership/corporate formalities, as the case may be, independent of
any other entity.

     Taking: A taking or voluntary conveyance during the Term of all or part of
the Leased Property, or any interest therein or right accruing thereto or use
thereof, as the result of, or in settlement of, any Condemnation or other
eminent domain proceeding affecting the Leased Property whether or not the same
shall have actually been commenced.

     Tangible Net Worth: For any Entity, the excess of total assets over total
liabilities, as determined in accordance with GAAP, but excluding from the
determination of total assets goodwill, organizational expenses, and other
similar intangibles.

     Tenant: As defined in the Preamble and any successor and assign herein
permitted.

     Tenant Related Party: Any Affiliate of Tenant and any partner, member,
manager, officer, director, or employee of Tenant or any Affiliate of Tenant.

     Term: The actual duration of this Lease from and after the Commencement
Date, including the Fixed Term and the Extension Terms (if exercised by Tenant)
and taking into account any early termination.

     Termination Fee: As defined in Section 2.4(b).


                                       -6-

<PAGE>

     Unsuitable for its Permitted Use: By reason of damage or destruction, or a
partial Taking by Condemnation, any Project cannot be operated on a commercially
practicable basis for the Permitted Use, taking into account all relevant
factors, and the effect of such damage or destruction or partial Taking.

                                    ARTICLE 2

                            LEASED PROPERTY AND TERM

     2.1 LEASED PROPERTY. Upon and subject to all of the other terms and
conditions set forth in this Lease, Landlord leases to Tenant and Tenant rents
from Landlord the following (each of items (a) through (e) below which, as of
the Commencement Date, relates to any single Project, a "Property" and,
collectively, the "Leased Property"):

          (a) those certain tracts or parcels of land more particularly
     described in Exhibits A-1 through A-13 attached hereto and made a part
     hereof (the "Land");

          (b) all buildings, structures, and other improvements of every kind
     located on the Land, including, but not limited to, the apartment
     buildings, clubhouses, mail buildings, tennis courts, swimming pools,
     recreational facilities, sidewalks, utility pipes, conduits and lines
     (on-site and off-site), parking areas and driveways appurtenant to such
     buildings and structures presently or hereafter situated upon the Land
     (collectively, the "Leased Improvements");

          (c) all easements, rights and appurtenances relating to the Land and
     the Leased Improvements;

          (d) all equipment, machinery, fixtures and other items of real and/or
     personal property, including all components thereof, now and hereafter
     located in, on or used in connection with, and permanently affixed to or
     incorporated into the Leased Improvements, including, without limitation,
     all furnaces, boilers, heaters, electrical equipment, heating, plumbing,
     lighting, ventilating, refrigerating, incineration, waste disposal,
     air-cooling and air-conditioning systems and apparatus, cable or satellite
     television systems, sprinkler systems and fire and theft protection
     equipment, all of which, to the greatest extent permitted by law, are
     hereby deemed by the parties hereto to constitute real estate, together
     with all replacements, modifications, alterations and additions thereto
     (collectively, the "Fixtures"); and

          (e) all equipment, appliances, furniture, furnishings, supplies, and
     other tangible personal property of any kind or description used or useful
     in connection with the operation of the Leased Improvements, and located on
     or in the Leased Improvements, and all modifications, replacements,
     alterations and additions to such personal property, except items, if any,
     included within the category of Fixtures (collectively, the "Leased
     Personal Property").

     2.2 FIXED TERM. The initial Term of this Agreement (the "Fixed Term") shall
commence on the Commencement Date and shall expire on December 31, 2010.


                                       -7-

<PAGE>

     2.3 EXTENSION RIGHTS. So long as no Event of Default has occurred and is
continuing under this Lease, and subject to satisfaction of the Lease Extension
Operating Test for such extension period, Tenant shall have the option (the
"Extension Option") to extend the Fixed Term of this Lease for three (3)
additional successive periods of five (5) years each (each an "Extension Term").
Said Extension Option shall be subject, however, to the following terms and
conditions:

          (a) Tenant shall exercise each such Extension Option by giving written
     notice to Landlord at least six (6) months prior to the expiration of the
     Fixed Term or the then current Extension Term, as applicable (the
     "Extension Notice"). Notwithstanding the foregoing, in the event Tenant
     fails to give notice of its election to extend at least six (6) months
     prior to the expiration of the Fixed Term or then current Extension Term,
     as the case may be, then Landlord shall notify Tenant in writing of such
     failure and thereafter Tenant shall have an additional fifteen (15) days to
     exercise the Extension Option by giving an Extension Notice to Landlord;
     and in the event Tenant fails to exercise the Extension Option within such
     fifteen (15) day period, then Tenant shall be deemed to have waived the
     Extension Option, and the Term shall expire at the end of the Fixed Term or
     then current Extension Term, as applicable.

          (b) No Event of Default shall exist on the date of commencement of any
     Extension Term.

          (c) Tenant shall have delivered to Landlord, on or before the first
     day of the applicable Extension Term, a renewal or extension of the Letter
     of Credit or a substitute letter of credit, upon the same terms and in the
     same amount (as the same may have been adjusted pursuant to Section 3.9(n))
     as the expiring Letter of Credit and otherwise acceptable to Landlord,
     which renewed, extended, or substituted letter of credit shall be
     maintained in effect, by automatic renewal or extension, until the date
     which is thirty (30) days after expiration of the subject Extension Term.
     Any such renewed, extended, or substituted letter of credit shall be deemed
     the "Letter of Credit" under this Lease during the subject Extension Term
     and shall be held and governed pursuant to the terms of Section 3.9 below
     which are applicable to the original Letter of Credit, including without
     limitation the provisions of said Section 3.9 which permit the reduction of
     the Letter of Credit from time to time.

Notwithstanding the foregoing, in the event that Net Operating Income from the
Leased Property, calculated on a trailing 12 month basis (excluding any Net
Operating Income attributable to any Property which has been released from this
Lease), shall have been not less than an amount equal to 1.05 times annual Base
Rent (excluding Base Rent attributable to any Property which has been released
from this Lease) for the eight (8) consecutive calendar quarters ending on
September 30 of the year immediately preceding the calendar year in which an
Extension Term commences, Tenant shall not be required to provide and maintain a
Letter of Credit during such Extension Term.

The Base Rent for each Extension Term shall be adjusted and reallocated among
the Properties as of the first day of such Extension Term as provided in Section
3.3 below, and the Additional


                                       -8-

<PAGE>

Rent Base shall be adjusted as of the first day of such Extension Term as
provided in Section 3.4 below.

Except for such adjustment of Base Rent and the Additional Rent Base, all of the
terms, covenants and conditions of this Lease shall continue in full force and
effect during each Extension Term, as if such Extension Term were part of the
original Term.

For purposes of this Section 2.3, the "Lease Extension Operating Test" for any
Extension Term shall mean that annualized Net Operating Income from the Leased
Property (excluding any Net Operating Income attributable to any Property which
has been released from this Lease) for the three (3) calendar month period
ending on November 30 of the year immediately preceding the calendar year in
which the applicable Extension Term commences shall be not less than 1.05 times
the annual Base Rent payable during such three (3) month calendar month period
(excluding any Base Rent attributable to any Property which has been released
from this Lease).

     2.4 LANDLORD'S EARLY TERMINATION RIGHTS.

          (a) Net Operating Income Shortfall. Notwithstanding anything to the
     contrary provided in this Lease, Landlord shall have the right to terminate
     this Lease upon not less than thirty (30) days advance Notice to Tenant if
     any of the following events occur:

               (i) Net Operating Income from the Leased Property, calculated on
          a trailing 12 month basis (excluding any Net Operating Income
          attributable to any Property which has been released from this Lease
          prior to the end of such 12 month period), shall have been less than
          an amount equal to 1.05 times annual Base Rent (excluding Base Rent
          attributable to any Property which has been released from this Lease)
          for the immediately preceding eight (8) consecutive calendar quarters,
          commencing with the third calendar quarter following the Commencement
          Date; or

               (ii) Net Operating Income from the Leased Property, calculated on
          a trailing 12 month basis (excluding any Net Operating Income
          attributable to any Property which has been released from this Lease
          prior to the end of such 12 month period), shall have been less than
          0.80 times annual Base Rent (excluding Base Rent attributable to any
          Property which has been released from this Lease) for the immediately
          preceding two (2) consecutive calendar quarters, commencing with the
          third calendar quarter following the Commencement Date.

     Any such Notice of termination shall be given within thirty (30) days
     following Landlord's receipt of the financial statements delivered pursuant
     to Section 14.2 which show the results of operations which give rise to the
     right of termination described above, or Landlord shall be deemed to have
     waived its right of termination pursuant to this Section 2.4(a) with
     respect to the period of operations covered by such financial statements.

          (b) Sale of Property. Subject to the transfer restrictions of Section
     20.1, Landlord shall have the right to terminate this Lease as to any
     individual Property upon


                                       -9-

<PAGE>

     not less than sixty (60) days advance Notice to Tenant in connection with
     the sale of such Property to an Entity which is not an Affiliate of
     Landlord; provided, however, that Landlord shall not be entitled to
     exercise its termination right under this subsection 2.4 (b) prior to the
     fourth (4th) Lease Year or, in the case of the Properties which are not
     subject to the Existing Mortgage Loan, prior to the payment and
     satisfaction (or defeasance) of the Existing Mortgage Loan. In the event
     that Landlord elects to terminate this Lease during the Fixed Term or the
     first year of the first Extension Term as to the entire Leased Property in
     connection with a sale of the entire Leased Property to a non-Affiliate in
     a single transaction or a series of related transactions, Landlord shall
     pay to Tenant a termination fee (a "Termination Fee") equal to (i) $1.5
     million, if such termination occurs during the fourth (4th) Lease Year,
     (ii) $1.0 million, if such termination occurs during the fifth (5th) Lease
     Year, and (iii) $0.5 million, if such termination occurs during the sixth
     (6th) Lease Year (if the Lease is extended after the Fixed Term). In the
     event that Landlord elects to terminate this Lease as to any individual
     Property in connection with the sale thereof during Lease Years 4 or 5 or,
     if the Lease is extended after the Fixed Term, Lease Year 6, Landlord shall
     pay to Tenant a termination fee with respect to such Property equal to such
     Property's allocable share of the applicable Termination Fee set forth
     above, which allocable share shall correspond to such Property's allocable
     share of the Base Rent, as established pursuant to Section 3.2 or Section
     3.3, as applicable below. After the sixth (6th) Lease Year no Termination
     Fee shall be payable in connection with a total or partial termination of
     this Lease by Landlord under this subsection 2.4(b).

     2.5 TENANT'S EARLY TERMINATION RIGHT. Tenant shall have the right to
terminate this Lease upon not less than sixty (60) days advance Notice to
Landlord at any time after any of the following events occur:

          (a) the Leased Property, or so much thereof as remains subject to the
     terms of this Lease from time to time, is sold in its entirety to an Entity
     which is not an Affiliate of Landlord or an Entity resulting from a
     consolidation or merger of Landlord; provided, however, this subparagraph
     shall not be applicable in the case of a foreclosure sale under any
     Superior Mortgage, as defined in Section 15.2, or under the Existing
     Mortgage Loan, as defined in Section 15.4, or in the case of a conveyance
     in lieu of a foreclosure under any such Superior Mortgage or under the
     Existing Mortgage Loan if the Superior Mortgagee or Existing Lender, or
     their respective nominee or designee, as applicable, elects or is required
     to continue this Lease following such foreclosure or conveyance in lieu of
     a foreclosure;

          (b) the termination of this Lease with respect to more than seven (7)
     of the individual Properties, whether as a result of Landlord's sale of
     such individual Properties, casualty, or otherwise; provided, however, this
     subparagraph shall not be applicable in the case of the termination of this
     Lease with respect to the Greenwich Properties as a result of a foreclosure
     under the Existing Loan Documents, a conveyance in lieu of foreclosure
     under the Existing Loan Documents, or the Existing Lender's exercise of any
     other rights or remedies under the Existing Loan Documents, if any Event of
     Default exists under this Lease as of the date this Lease is terminated
     with respect to such Greenwich Properties;


                                      -10-

<PAGE>

          (c) the termination of this Lease as to one or more Properties by
     reason of a sale by Landlord of such Properties pursuant to Section 2.4(b)
     (other than pursuant to any Condemnation) if, as a result of such
     termination, the Net Operating Income from the remaining Properties would
     fall below an amount equal to 1.10 times annual Base Rent (excluding the
     Base Rent attributable to the Property sold), based upon the Net Operating
     Income of the remaining Properties for the most recent calendar quarter for
     which financial statements have been provided pursuant to Section 14.2;
     provided, however, this subparagraph shall not be applicable in the case of
     the termination of this Lease with respect to any Property as a result of a
     foreclosure or a conveyance of lieu of foreclosure under the Existing
     Mortgage Loan or any Superior Mortgage, or the exercise of any other right
     of termination by the Existing Lender or Superior Mortgagee, if any Event
     of Default exists under this Lease as of the date this Lease is so
     terminated with respect to any Property.

In the event that Tenant exercises a termination right under this Section 2.5
during the Fixed Term or the first Lease Year of the first Extension Term,
Landlord shall be required to pay to Tenant a Termination Fee calculated in the
manner described in Section 2.4(b).

     2.6 NO OTHER TERMINATION. Except as otherwise specifically provided in this
Agreement, each of Landlord and Tenant, to the maximum extent permitted by law,
shall remain bound by this Lease in accordance with its terms and, without the
consent of the other, shall not take any action without the consent of the other
to modify, surrender or terminate this Lease. Except as otherwise expressly
provided in this Lease, the respective obligations of Landlord and Tenant shall
not be affected by reason of (a) any damage to, or destruction of, Leased
Property or any portion thereof from whatever cause or any Taking of the Leased
Property or any portion thereof, or (b) any bankruptcy, insolvency,
reorganization, composition, readjustment, liquidation, dissolution, winding up
or other proceedings affecting Landlord or any assignee or transferee of
Landlord. Except as otherwise specifically provided in this Agreement or as may
be provided at law or in equity, Tenant hereby specifically waives all rights,
arising from any occurrence whatsoever, which may now or hereafter be conferred
upon it by law to modify, surrender or terminate this Lease or quit or surrender
the Leased Property or any portion thereof. The obligations of Landlord and
Tenant hereunder shall be separate and independent covenants and agreements and
the Rent and all other sums payable by Tenant hereunder shall continue to be
payable in all events unless the obligations to pay the same shall be terminated
pursuant to the express provisions of this Lease.

                                    ARTICLE 3

                                      RENT

     3.1  RENTAL PAYMENTS.

          (a) Beginning on the Commencement Date and continuing thereafter
     throughout the Term, Tenant hereby agrees to pay the Rent due and payable
     under this Lease. As used in this Lease, the term "Rent" shall mean Base
     Rent (as defined in Section 3.2 below), Additional Rent (as defined in
     Section 3.4 below), and the Additional Charges (as defined in Section 3.5
     below). Base Rent shall be payable


                                      -11-

<PAGE>

     without demand on the fifteenth (15th) day of each calendar month during
     the Term. If the Term commences on a day other than the first day of a
     month, or terminates on a day other than the last day of a month, the Base
     Rent for the first and last partial month shall be prorated based upon the
     actual number of days in such a month. Except as specifically set forth in
     this Lease, Rent shall be due and payable in all events, without any setoff
     or deduction whatsoever, unless expressly allowed hereunder. All payments
     of Rent shall be made in legal tender at the address of Landlord set forth
     in Section 22.1 hereof, or at such other place as Landlord shall designate
     from time to time in writing.

          (b) No payment by Tenant or acceptance by Landlord of an amount less
     than the Rent herein stipulated shall be deemed a waiver of any additional
     amount due. No partial payment or endorsement on any check or any letter
     accompanying any payment of Rent shall be deemed an accord and
     satisfaction, but Landlord may accept such payment without prejudice to
     Landlord's right to collect the balance of any Rent due under the terms of
     this Lease.

          (c) Whenever in this Lease a payment is required to be made by one
     party to the other, but a specific date for payment is not set forth or a
     specific number of days within which payment is to be made is not set
     forth, or the words "immediately," "promptly" and/or "on demand," or the
     equivalent, are used to specify when such payment is due, then such payment
     shall be due ten (10) days after the party which is entitled to such
     payment sends written notice to the other party demanding payment.

          (d) To the extent that Tenant is required to deliver all revenues and
     receipts from the Greenwich Properties to the Existing Lender and the
     Existing Lender applies such revenues and receipts to fund obligations of
     Landlord under the Existing Loan Documents, the amounts so applied by the
     Existing Lender shall be credited against Tenant's obligations with respect
     to Base Rent and Additional Rent hereunder, as more particularly described
     in Section 15.4(g) hereof.

     3.2  BASE RENT.

          (a) Subject to adjustment as provided in Section 3.3, Article 10, and
     Article 11, Tenant shall pay Landlord base rent (the "Base Rent") in an
     amount equal to THIRTEEN MILLION SEVEN HUNDRED THIRTY SIX THOUSAND SEVEN
     HUNDRED FIFTY AND NO/100 DOLLARS ($13,736,750.00) per annum. Base Rent
     shall be payable in advance in equal, consecutive monthly installments on
     the fifteenth (15th) day of each calendar month of the Term, commencing
     after Commencement Date (prorated as to any partial month).

          (b) Landlord and Tenant agree that during the Fixed Term the Base Rent
     shall be allocated among the Properties as set forth in Exhibit B attached
     hereto and by this reference made a part hereof. In the event that this
     Lease is extended in accordance with Section 2.3 above, Base Rent shall be
     reallocated among the Properties in accordance with the terms of Section
     3.3(b) below.


                                      -12-

<PAGE>

     3.3  ADJUSTMENTS TO BASE RENT.

          (a) In the event that the Fixed Term of this Lease is extended in
     accordance with Section 2.3 above, Base Rent payable during the subject
     Extension Term shall be increased or decreased over the Base Rent payable
     during the Fixed Term or immediately preceding Extension Term, as
     applicable, by an amount equal to the product of the annual Base Rent
     payable during such immediately preceding period multiplied by the
     percentage increase or decrease in the Consumer Price Index for the period
     between the first month of the Fixed Term or immediately preceding
     Extension Term, as applicable, and September of the calendar year
     immediately preceding the first calendar year of the applicable Extension
     Term.

          (b) In the event that the Fixed Term of this Lease is extended in
     accordance with Section 2.3 above, the Base Rent applicable during such
     Extension Term shall be reallocated among the Properties, or so many of the
     Properties as remain subject to this Lease, as of the first day of the
     applicable Extension Period, so that the Base Rent attributable to each
     Property shall bear the same proportion to total Base Rent as the Gross
     Rentals from such Property for the immediately preceding Additional Rent
     Year bear to total Gross Rentals from all Properties for such immediately
     preceding Additional Rent Year (excluding Gross Rentals attributable to any
     Property which is no longer subject to the Lease). For example, if the
     Gross Rentals generated by a Property during the last full Additional Rent
     Year of the Fixed Term or an Extension Term represent twelve percent (12%)
     of the total Gross Rentals during such Additional Rent Year from all
     Properties which remain subject to this Lease as of the first day of the
     next following Extension Term, then twelve percent (12%) of the Base Rent
     under this Lease during such Extension Term shall be allocated to such
     Property. Within thirty (30) days after the commencement of an Extension
     Term, Landlord and Tenant shall enter into an addendum to this Lease
     acknowledging the reallocation of Base Rent among the Properties in
     accordance with this subparagraph (b), and such revised allocation shall
     supersede Exhibit B hereto for the remainder of such Extension Term.

          (c) In the event that any individual Property is released from the
     terms of this Lease in connection with the sale thereof as described in
     Section 2.4(b), in connection with the termination of this Lease as to such
     Property as a result of casualty or condemnation pursuant to Article 10 or
     11 hereof, or in connection with the termination of this Lease as to such
     Property as a result of a foreclosure or deed in lieu of foreclosure under
     the Existing Mortgage Loan or any Superior Mortgage, or as a result of the
     exercise of any other remedies by the Existing Lender under the Existing
     Loan Documents, as described in Section 15.4(h) and Section 15.4(i) below,
     Base Rent shall be reduced by the affected Property's allocable share of
     Base Rent, as determined by reference to Section 3.2(b) or 3.3(b) above, as
     applicable.

     3.4  ADDITIONAL RENT.

          (a) In addition to Base Rent, Tenant shall pay to Landlord additional
     rent ("Additional Rent") equal to forty one percent (41%) (the "Applicable
     Percentage") of the amount by which the Gross Rentals from the Leased
     Property for each Additional


                                      -13-

<PAGE>

     Rent Year, or fraction thereof falling within the Term of this Lease, shall
     exceed the Additional Rent Base (as hereinafter defined) applicable to such
     Additional Rent Year, or an appropriate fraction thereof if the period in
     question during the Term hereof shall be less than a full Additional Rent
     Year. The Applicable Percentage will remain constant in the event that the
     Fixed Term of this Lease is extended in accordance with Section 2.3.

          (b) As used herein, during the Fixed Term "Additional Rent Base" shall
     mean as follows:

               In the first Lease Year of the Fixed Term: $23,481,624

               In the second Lease Year of the Fixed Term: $23,716,440

               In the third Lease Year of the Fixed Term: $23,953,605

               In the fourth Lease Year of the Fixed Term: $24,193,141

               In the fifth Lease Year of the Fixed Term: $24,435,072

     For purposes of calculating Additional Rent due hereunder, the Additional
     Rent Base for the period from the Commencement Date to July 31, 2006 shall
     equal a pro rata portion of the Additional Rent Base for the first Lease
     Year, i.e., $23,481,624 times .58082 (i.e. 212 divided by 365). The
     Additional Rent Base for subsequent Additional Rent Years shall equal the
     sum of (i) a pro rata portion of the Additional Rent Base for any Lease
     Year ending during such Additional Rent Year, plus (ii) a pro rata portion
     of the Additional Rent Base for any Lease Year beginning during such
     Additional Rent Year, in each case based on the number of months of each
     such Lease Year which fall within the applicable Additional Rent Year. For
     example, for the Additional Lease Year commencing on August 1, 2006, the
     Additional Rent Base shall be the sum of (i) $9,843,927.00, representing
     .41918 times the Additional Rent Base for the first Lease Year, plus (ii)
     $13,774,982.00, representing .58082 times the Additional Rent Base for the
     second Lease Year.

     In the event that the Term of this Lease is extended in accordance with
     Section 2.3, the Additional Rent Base for first Lease Year of the subject
     Extension Term shall be the Additional Rent Base for the first Lease Year
     of the Fixed Term or immediately preceding Extension Term, as applicable,
     multiplied by the percentage increase or decrease in the Consumer Price
     Index for the period between the first month of the Fixed Term or
     immediately preceding Extension Term, as applicable, and the month which is
     four (4) months prior to the first month of the applicable Extension Term,
     with this new Additional Rent Base to increase after the first Lease Year
     of the Extension Term by one percent (1%) per year during the remainder of
     such Extension Term. In the event this Lease shall terminate with respect
     to any individual Property in accordance with the terms of Section 2.4(b),
     Article 10, Article 11, Section 15.2, or Section 15.4, the Additional Rent
     Base for the period after the effective date of such termination shall be
     reduced in an amount proportionate to the reduction in Base Rent resulting
     from the release of the affected Property from this Lease, as determined by
     reference to Section 3.3(c) hereof.


                                      -14-

<PAGE>

          (c) The term "Gross Rentals" as used in this Lease shall include all
     rentals and other sums or consideration received by Tenant from subtenants
     or other persons for or in respect of any use or occupation of the Leased
     Property or any part thereof during the Term of this Lease (whether
     pursuant to lease, concession, license, franchise or otherwise), including
     without limitation apartment rental, clubhouse rental, fees for cable or
     telecom services, income generated through leases for laundry services and
     equipment, non-refundable application fees, and non-refundable security
     deposits or security deposits forfeited as rent from subtenants, as well as
     proceeds of rent or business interruption insurance paid for the relevant
     period of calculation in respect of such subtenant rents, but excluding any
     interest or dividends earned on Tenant's investment of surplus cash.

     So long as Landlord shall desire to qualify for taxation as a real estate
     investment trust, the term "Gross Rentals" shall be deemed to not include
     any amounts referred to above which, if included in the definition of
     "Gross Rentals," would result in any part of the fixed rental and/or
     additional rental payable to Landlord hereunder being held not to
     constitute "rents from real property" as that term is defined in Section
     856(d) of the Internal Revenue Code of 1954 and the regulations issued
     thereunder, as the same may be amended from time to time.

          (d) Additional Rent for each Additional Rent Year or portion thereof
     shall be calculated and paid annually in arrears. Within sixty (60) days
     after the end of each Additional Rent Year during the Term, commencing
     September 30, 2006, and within sixty (60) days after the end of the final
     Lease Year of the Term or the prior termination of this Lease, as the case
     may be, Tenant shall deliver to Landlord (i) a Financial Officer's
     Statement containing (A) a detailed report of the Gross Rentals for the
     Leased Property for the preceding Additional Rent Year (or fraction
     thereof), as audited by the approved accountants, and (B) Tenant's
     computation of Additional Rent payable for such Additional Rent Year, or
     applicable portion thereof, and (ii) Tenant's check in payment of the
     Additional Rent due and payable for such Additional Rent Year. All costs of
     audit of Tenant's reports of Gross Rentals shall be paid by Landlord.

          (e) Tenant shall utilize, or cause to be utilized, an accounting
     system for each Property in accordance with its usual and customary
     practices and in accordance with GAAP, which will accurately record all
     Gross Rentals from each Property and Tenant shall retain, for at least
     three (3) years after the expiration of each Additional Rent Year,
     reasonably adequate records conforming to such accounting system showing
     all Gross Rentals for such Property for such Additional Rent Year.
     Landlord, at its own expense, except as provided hereinbelow, shall have
     the right, exercisable by Notice to Tenant within one (1) year after
     receipt of the statement referred to in subsection (d) above, by its
     accountants or representatives to audit the information set forth in such
     statement and, in connection with such audit, to examine Tenant's and the
     Manager's books and records with respect thereto (including supporting
     data). If any such audit discloses a deficiency in the payment of
     Additional Rent and either Tenant agrees with the result of such audit or
     the matter is otherwise compromised with or resolved in favor of Landlord,
     Tenant shall forthwith pay to Landlord the amount of the deficiency, as
     finally agreed or determined, together with interest at the Interest Rate
     from the date


                                      -15-

<PAGE>
     such payment should have been made to the date of payment thereof. If such
     deficiency, as agreed upon, compromised, or resolved as aforesaid, is more
     than four percent (4%) of the Gross Rentals reported by Tenant for such
     Additional Rent Year and, as a result, Landlord did not receive at least
     ninety five percent (95%) of the Additional Rent payable with respect to
     such Additional Rent Year, Tenant shall pay the reasonable cost of such
     audit and examination. If any such audit discloses that Tenant paid more
     Additional Rent for any Additional Rent Year than was due hereunder, and
     either Landlord agrees with the result of such audit or the matter is
     otherwise determined, Landlord shall grant Tenant a credit equal to the
     amount of such overpayment against Base Rent and Additional Rent next
     coming due in the amount of such difference, as finally agreed or
     determined, together with interest at the Interest Rate, which interest
     shall accrue from the time of Tenant's statement of Gross Rentals until the
     date such credit is applied and paid, as the case may be. If such a credit
     cannot be made because the Term has expired before the credit can be
     applied in full, Landlord shall pay the unapplied balance of such credit to
     Tenant, together with interest at the Interest Rate, which interest shall
     accrue until the date of payment from Landlord.

     3.5 ADDITIONAL CHARGES. In addition to the Base Rent and Additional Rent
payable hereunder, Tenant shall pay to the appropriate parties and discharge as
and when due and payable the following (collectively, the "Additional Charges"):

          (a) Impositions. Subject to the terms of Article 8 relating to
     permitted contests and except to the extent paid by any Project Mortgagee,
     Tenant will pay, or cause to be paid, all Impositions before any fine,
     penalty, interest or cost may be added for non-payment, such payments to be
     made directly to the taxing authorities or other party to whom such
     Imposition is payable where feasible, and Tenant will promptly, upon
     request, furnish to Landlord copies of official receipts or other
     satisfactory proof evidencing such payments. Tenant's obligation to pay the
     Impositions shall be deemed absolutely fixed upon the date the Imposition
     becomes a lien upon the Leased Property or any part thereof. If any
     Imposition may, at the option of the Landlord, lawfully be paid in
     installments (whether or not interest shall accrue on the unpaid balance of
     such Imposition), Tenant may exercise the option to pay the same (and any
     accrued interest on the unpaid balance of such Imposition) in installments
     and, in such event, shall pay such installments during the Term (subject to
     Tenant's right of contest pursuant to the provisions of Article 8) as the
     same respectively become due and before any fine, penalty, premium, further
     interest or cost may be added thereto. Landlord, at its expense, shall
     prepare and file all tax returns and reports as may be required by
     Governmental Authorities in respect of Landlord's net income, gross
     receipts, franchise taxes and taxes on its capital stock, and Tenant, at
     its expense and to the extent permitted by applicable laws and regulations
     shall prepare and file all tax returns and reports in respect of any
     Imposition as may be required by Governmental Authorities. If any refund
     shall be due from any taxing authority in respect of any Imposition paid by
     Tenant, the same shall be paid over to or retained by Tenant. Landlord and
     Tenant shall, upon request of the other, provide such data as is maintained
     by the party to whom the request is made with respect to the Leased
     Property as may be necessary to prepare any required returns and reports.
     In the event Governmental Authorities classify any property covered by this
     Lease as personal property, Tenant shall file all


                                      -16-
<PAGE>

     personal property tax returns in such jurisdictions where filing is
     required and Tenant may legally make such filing. Landlord, to the extent
     it possesses the same, and Tenant, to the extent it possesses the same,
     will provide the other party, upon request, with cost and depreciation
     records necessary for filing returns for any property so classified as
     personal property. Where Landlord is legally required to file personal
     property tax returns, Tenant will be provided with copies of assessment
     notices indicating a value in excess of the reported value in sufficient
     time for Tenant to file a protest. All Impositions assessed against such
     personal property shall be (irrespective of whether Landlord or Tenant
     shall file the relevant return) paid by Tenant not later than the last date
     on which the same may be made without interest or penalty, except to the
     extent such Impositions are to be paid by any Project Mortgagee.

          (b) Adjustment of Impositions. Impositions imposed in respect of the
     tax-fiscal period during which the Term terminates shall be adjusted and
     prorated between Landlord and Tenant, whether or not such Imposition is
     imposed before or after such termination, and Tenant's obligation to pay
     its prorated share thereof shall survive such termination.

          (c) Utility Charges. Tenant will contract for, in its own name or the
     name of the Property, and will pay or cause to be paid all charges for
     electricity, power, gas, oil, water, telephone, cable television, internet
     access, and other utilities used in connection with the operation of the
     Leased Property. Landlord will provide any bonds, guarantees or deposits
     required by any utility service providers.

          (d) Insurance Premiums. Tenant shall pay or cause to be paid all
     premiums for the insurance coverage required to be maintained by Tenant
     pursuant to Article 9.

          (e) Other Charges. Tenant shall pay or cause to be paid all other
     amounts, liabilities and obligations with respect to the operation of the
     Leased Property.

          (f) Reimbursement for Additional Charges. If Tenant pays or causes to
     be paid, or deposits in escrow with any Project Mortgagee any amounts for
     the payment of, property taxes or similar or other Additional Charges
     attributable to periods after the end of the Term, whether upon expiration
     or sooner termination of this Agreement, Tenant may, within a reasonable
     time after the end of the Term, provide Notice to Landlord of its estimate
     of such amounts. Landlord shall promptly reimburse Tenant for all payments
     or deposits of such taxes and other similar Additional Charges that are
     attributable to any period after the Term of this Agreement.

     3.6 MONTHLY IMPOUNDS. Tenant agrees that, if at any time any Project
Mortgagee requires Landlord to deposit funds monthly with such Project Mortgagee
for the payment of Impositions, then in addition to the monthly installments of
Base Rent required pursuant to Section 3.2, Tenant shall deposit monthly with
such Project Mortgagee, on the day of each month required by such Project
Mortgagee, a sum equal to the estimated Impositions required to be deposited by
such Project Mortgagee. If the total monthly payments made by Tenant under this
Section 3.6 shall exceed the amount actually payable by Tenant for any such
Imposition, such excess shall be credited against subsequent monthly payments of
Base Rent or Additional


                                      -17-

<PAGE>

Rent due hereunder, or such excess shall be returned to Tenant. If the total
monthly payments made by Tenant under this Section 3.6 shall be insufficient to
pay such Impositions when due, the Tenant shall upon demand pay to Landlord or,
at Landlord's direction, to the applicable Project Mortgagee the amount
necessary to make up the deficiency. To the extent that Tenant complies with
this Section 3.6 and makes such payments to Landlord or a Project Mortgagee,
Tenant shall be relieved from compliance with the provisions of this Article 3
which require the direct payment of such Impositions by Tenant. In the event of
default in the payment of any monthly or any other installment provided for in
this Section 3.6, Landlord shall have the same remedies as those provided for in
this Lease for default in the payment of Rent. To the extent received by Tenant,
Tenant shall deliver to Landlord any bills received by Tenant for all
Impositions for which deposits are being made, in ample time to enable Landlord
to cause the applicable Project Mortgagee to pay the same before interest or
penalty shall accrue. Landlord shall be furnished with reasonable proof from
Tenant that such deposits are actually being made to a Project Mortgagee.

     3.7 LATE PAYMENT OF RENT, ETC. If any installment of Base Rent, Additional
Rent or Additional Charges (but only as to those Additional Charges which are
payable directly to Landlord) shall not be paid within five (5) days after its
due date, Tenant shall pay Landlord, on demand, as Additional Charges, a late
charge (to the extent permitted by law) computed at the Overdue Rate on the
amount of such installment, from the due date of such installment to the date of
payment thereof. To the extent that Tenant pays any Additional Charges directly
to Landlord or any Project Mortgagee pursuant to any requirement of this
Agreement, Tenant shall be relieved of its obligation to pay such Additional
Charges to the Entity to which they would otherwise be due. In the event of any
failure by Tenant to pay any Additional Charges when due, Tenant shall promptly
pay and discharge, as Additional Charges, every fine, penalty, interest and cost
which is added by the Entity to which such Additional Charges are due for
non-payment or late payment of such items. Such fines, penalties, interest and
costs shall not constitute Operating Expenses for purposes of this Lease.

     3.8 NET LEASE. Rent shall be paid absolutely net to Landlord, so that this
Lease shall yield to Landlord the full amount of Base Rent and Additional Rent
throughout the Term, but subject to any other provisions of this Lease which
expressly provide for adjustment of Rent or other charges.

     3.9 LETTER OF CREDIT.

          (a) Tenant shall, simultaneously with the delivery of this Lease,
     deliver to Landlord an irrevocable, stand-by letter of credit (a "Letter of
     Credit") in the initial amount of FIVE MILLION AND NO/100 DOLLARS
     ($5,000,000.00) to assure the payment by Tenant of Base Rent and Additional
     Rent. The Letter of Credit shall be maintained in effect, by automatic
     renewal or extension, until the date (the "LC Expiration Date") which is
     thirty (30) days after the expiration of the Fixed Term or earlier as set
     forth in Section 3.9(l) below.

          (b) The Letter of Credit shall be in the form attached hereto as
     Exhibit C or in such other form as may be reasonably approved by Landlord
     and otherwise shall be subject to the provisions of this Section 3.9. The
     Letter of Credit shall be issued by a


                                      -18-

<PAGE>

     national bank approved by Landlord in its sole but reasonable discretion
     (the "Bank") and be "callable" by Landlord and payable through a branch
     office of the Bank located in the City of Memphis, Tennessee. The premium
     or purchase price of, or any other Bank fees associated with, such Letter
     of Credit shall be paid by Tenant (except those payable by Landlord
     pursuant to Section 3.9(e) below) and shall not constitute an Operating
     Expense for purposes of this Lease.

          (c) The Letter of Credit shall (i) be subject to the Uniform Customs
     and Practices for Documentary Credits, International Chamber of Commerce
     Publication No. 500 (1993 Revision), (ii) be fully transferable by Landlord
     only in connection with a transfer of Landlord's interest in this Lease,
     including transfers by foreclosure or deed in lieu of foreclosure, and
     (iii) permit partial draws from time to time.

          (d) In addition to the foregoing, the Letter of Credit shall provide
     that Landlord shall have the right to draw down for amounts of unpaid Base
     Rent and Additional Rent then currently due up to the face amount of the
     Letter of Credit upon the presentation to the Bank of a Sight Draft and a
     Certificate signed by an officer of Landlord meeting the requirements set
     forth in the form of Letter of Credit attached hereto as Exhibit "C".

          (e) In the event of a transfer of Landlord's interest in the Leased
     Property, Landlord shall transfer the Letter of Credit (or cause a
     substitute letter of credit to be delivered, as applicable) to the
     transferee, and it is agreed that the provisions hereof shall apply to
     every transfer of the Letter of Credit to a new Landlord. Landlord shall be
     responsible for all normal and customary charges of the Bank in connection
     with any such transfer.

          (f) Except as described in subparagraph (h) below and in Section
     12.2(d), Landlord agrees not to draw upon the Letter of Credit unless an
     Event of Default by Tenant in paying Base Rent or Additional Rent has
     occurred under this Lease, after giving such notice thereof to Tenant as
     may be required in accordance with the terms of this Lease. If Landlord
     does effect such a "draw" under this subparagraph (f), such "draw" amount
     may only be made for (i) the past due amount of Base Rent or Additional
     Rent, or (ii) the amount of any deficiency in Net Operating Income pursuant
     to Section 12.2(c)(i) hereof. In no event shall Landlord be entitled to
     draw upon the Letter of Credit for accelerated Rent pursuant to Section
     12.2(c)(ii) hereof.

          (g) Any failure or delay of Landlord to "draw" any portion of the
     Letter of Credit shall not act as a waiver of Landlord's right to do so at
     any time thereafter (through and until the LC Expiration Date) or
     constitute a waiver of any Event of Default with respect to this Lease.

          (h) If the Letter of Credit is due to expire earlier than the LC
     Expiration Date, Tenant shall provide a renewal letter of credit (or
     amendment renewing the same) or substitute letter of credit (such renewal
     or amendment or substitute letter of credit to be in effect and delivered
     to Landlord, as applicable, not later than thirty (30) days prior to the
     expiration of the Letter of Credit), upon the same terms as the expiring
     Letter of Credit


                                      -19-

<PAGE>

     (except for permitted reductions in amounts) or such other terms as may be
     acceptable to Landlord in its reasonable discretion. If the Letter of
     Credit is not timely renewed or a substitute letter of credit is not timely
     received, or if Tenant fails to maintain the Letter of Credit in the amount
     and in accordance with the terms set forth in this Section, the Landlord
     shall have the right to draw upon the Letter of Credit in the full face
     amount thereof and hold all proceeds of the Letter of Credit as cash
     collateral ("Cash Collateral") for the payment of Base Rent and Additional
     Rent. Landlord shall hold any Cash Collateral in an interest bearing
     account with a national banking association or other depository or a money
     market fund having a branch office in Memphis, Tennessee requested by
     Tenant and reasonably acceptable to Landlord, with any interest earned on
     such account to be for the sole benefit of Tenant except to the extent used
     to pay Base Rent or Additional Rent due Landlord. Landlord shall not
     co-mingle any Cash Collateral with other funds of Landlord. Landlord shall
     have no liability to Tenant with respect to the amount of interest paid on
     any such account.

          (i) If there shall occur an Event of Default under the Lease with
     respect to payment of Base Rent or Additional Rent, Landlord may, but
     without obligation to do so, in addition to any other rights and remedies
     held by Landlord, draw upon the Letter of Credit and/or utilize the Cash
     Collateral in an amount necessary to collect the unpaid Base Rent or
     Additional Rent. No condition or term of this Lease shall be deemed to
     render the Letter of Credit conditional upon this Lease or to justify the
     issuer of the Letter of Credit in failing to honor a draw upon such Letter
     of Credit in a timely manner. In the event Landlord is determined through
     any dispute resolution procedure agreed upon by the parties or by a court
     of competent jurisdiction to have improperly drawn on the Letter of Credit,
     then Tenant shall be entitled to receive a prompt refund of such improper
     amount from Landlord (together with any bank fees and charges incurred by
     Tenant as a result thereof, interest at the Overdue Rate and all costs and
     fees, including legal fees and expenses incurred by Tenant in obtaining
     such refund).

          (j) In the event Landlord draws upon the Letter of Credit or the Cash
     Collateral pursuant to subparagraph (i) above, Tenant agrees that within
     ten (10) Business Days after Tenant receives notice of such draw (i) in the
     case of any draw upon the Letter of Credit, Tenant will cause the Letter of
     Credit to be amended so that the amount available thereunder is restored to
     the amount available prior to such draw, and (ii) in the case of any draw
     upon the Cash Collateral, Tenant will deposit with Landlord an amount equal
     to the amount so drawn by Landlord, to be held as part of the Cash
     Collateral pursuant to the terms of this Lease. Any failure by Tenant to so
     restore the amount of the Letter of Credit or the Cash Collateral, as the
     case may be, shall constitute an Event of Default by Tenant under this
     Lease.

          (k) Tenant acknowledges and agrees that the Letter of Credit
     constitutes a separate and independent contract between Landlord and the
     issuing bank, that Tenant is not a third party beneficiary of such
     contract, and that Landlord's claim under the Letter of Credit for the full
     amount due and owing thereunder shall not be, in any way, restricted,
     limited, altered or impaired by virtue of any provision of the Bankruptcy
     Code.


                                      -20-

<PAGE>

          (l) If this Lease is terminated prior to the LC Expiration Date and
     such termination is not the result of an Event of Default hereunder, or if
     this Lease is terminated as a result of an Event of Default but Tenant's
     obligation with respect to any deficiency in Base Rent pursuant to Section
     12.2(c)(i) shall have expired, the Letter of Credit or Cash Collateral, as
     applicable, shall be promptly returned by Landlord to Tenant, subject to
     any draws for unpaid Base Rent, Additional Rent, or Base Rent deficiencies
     which have previously been made by Landlord. In any event, the Letter of
     Credit or Cash Collateral shall be promptly returned to Tenant after
     Landlord has no further right to make any draws thereunder.

          (m) Tenant will not assign or encumber Tenant's interest in the Letter
     of Credit or Cash Collateral, as the case may be, or any part thereof, and
     neither Landlord nor Landlord's successors or assigns will be bound by any
     such attempted assignment or encumbrance.

          (n) Notwithstanding anything to the contrary provided in this Section
     3.9, subject to the approval of the Existing Lender so long as the Existing
     Mortgage Loan encumbers the Greenwich Properties, and provided that (i) no
     uncured Event of Default shall exist, (ii) no amount of Base Rent or
     Additional Rent is due and unpaid, and (iii) no restoration of the amount
     of the Letter of Credit is required as of the time of any such reduction,
     then in the event that this Lease shall terminate with respect to any
     individual Property in accordance with the terms of Section 2.4(b), Article
     10, Article 11, or Section 15.4(h) below, Tenant shall be entitled at any
     time thereafter to reduce the amount of the Letter of Credit in an amount
     proportionate to the reduction in Base Rent resulting from the release of
     such Property, as determined by reference to Section 3.3(c) hereof. This
     Section 3.9(n) shall not be applicable in the case of a termination of this
     Lease with respect to Carrollton Place, Southern Place, Berkeley Place and
     Western Place pursuant to Section 15.4(i) below.

          (o) Notwithstanding anything to the contrary hereinabove provided,
     Tenant acknowledges and agrees that the Letter of Credit shall be
     conditionally assigned to the Existing Lender in connection with the
     Existing Loan Documents, as defined in Section 15.4 below, and agrees that
     in the event the Existing Lender or its nominee or designee succeed to the
     interest of the Landlord under this Lease following the foreclosure,
     conveyance in lieu of foreclosure, or exercise of any other remedies of the
     Existing Lender under the Existing Loan Documents, said Existing Lender or
     its nominee or designee shall succeed to the interest of the Landlord with
     respect to the Letter of Credit. Upon the release of any such collateral
     assignment by the Existing Lender, Tenant shall cause the Letter of Credit
     to be amended or re-issued to eliminate any requirement that the Existing
     Lender join with Landlord in connection with any draw on the Letter of
     Credit.


                                      -21-

<PAGE>

                                    ARTICLE 4

                      CONDITION AND USE OF LEASED PROPERTY

     4.1 CONDITION OF THE LEASED PROPERTY. Tenant acknowledges receipt and
delivery of possession of the Leased Property and that Tenant has examined and
otherwise has acquired knowledge of the condition of the Leased Property prior
to the execution and delivery of this Lease and has found the same to be in good
order and satisfactory for its purpose hereunder. Tenant is leasing the Leased
Property "as is" in its present condition, subject to the rights of parties in
possession, the existing state of title (as evidenced by title insurance
policies and endorsements issued to Landlord on the date of execution of this
Lease, copies which have been made available to Tenant), including all
covenants, conditions, restrictions, reservations, easements and other matters
of record or that are visible or apparent on the Leased Property, all applicable
Legal Requirements, the lien of any financing instruments, mortgages, deeds to
secure debt, and deeds of trust existing as of the Commencement Date or
permitted by the terms of this Agreement, and such other matters which would be
disclosed by an inspection of the Leased Property. TENANT REPRESENTS THAT IT HAS
INSPECTED THE LEASED PROPERTY AND ALL OF THE FOREGOING AND HAS FOUND THE
CONDITION THEREOF SATISFACTORY AND IS NOT RELYING ON ANY REPRESENTATION OR
WARRANTY OF LANDLORD OR LANDLORD'S AGENTS OR EMPLOYEES WITH RESPECT THERETO AND
TENANT WAIVES ANY CLAIM OR ACTION AGAINST LANDLORD IN RESPECT OF THE CONDITION
OF THE LEASED PROPERTY. LANDLORD MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR
IMPLIED, IN RESPECT OF THE LEASED PROPERTY OR ANY PART THEREOF, EITHER AS TO ITS
FITNESS FOR USE, SUITABILITY, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR
PURPOSE OR OTHERWISE, AS TO QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN,
LATENT OR PATENT, IT BEING AGREED THAT ALL SUCH RISKS ARE TO BE BORNE BY TENANT.

     4.2 PERMITTED USES. During the Term, Tenant shall use or cause to be used
the Leased Property as residential apartments and for such uses incidental
thereto as may be permitted from time to time by applicable law and which may
enhance the value, rental, or rental value thereof as student housing oriented
residential apartment complexes (the "Permitted Use"). Tenant shall not use the
Leased Property or any portion thereof for any other use without the prior
written consent of Landlord, which Tenant agrees may be withheld in Landlord's
sole discretion.

     4.3 COMPLIANCE WITH LEGAL AND INSURANCE REQUIREMENTS. Subject to Article 8
relating to permitted contests and subject to Landlord's obligation to fund the
cost of capital repairs and replacements pursuant to Section 5.2 hereof, Tenant,
will promptly (a) comply with all Legal Requirements and Insurance Requirements
in respect of the use, operation, maintenance, and repair of the Leased
Property, and (b) procure, maintain and comply with all licenses and other
authorizations obtainable by Tenant required for the Tenant's use and operation
of the Leased Property for the Permitted Use. Upon Landlord's request, Tenant
shall deliver copies of all such licenses and other authorizations.

     4.4 LAWFUL USE, ETC. Tenant covenants and agrees that Tenant shall not
knowingly use, suffer or permit the Leased Property to be used for any unlawful
purpose. Tenant further


                                      -22-

<PAGE>

covenants and agrees that Tenant shall not commit or suffer to be committed any
waste on any Leased Property, nor shall Tenant knowingly cause or permit any
unlawful nuisance thereon or therein.

     4.5 ENVIRONMENTAL MATTERS.

          (a) During the Term, Tenant (i) shall comply, and cause the Leased
     Property to comply, with all Hazardous Materials Laws relating to the
     operation of the Leased Property, (ii) shall prohibit the use of the Leased
     Property for the generation, manufacture, refinement, production, or
     processing of any Hazardous Material or for the storage, handling, transfer
     or transportation of any Hazardous Material (other than in compliance with
     the Hazardous Materials Laws and in commercially reasonable quantities in
     connection with the operation, business and maintenance of the Leased
     Property as a residential apartment complex), (iii) shall not permit to
     remain, install or permit the installation on the Leased Property of any
     underground storage tanks, transformers containing polychlorinated
     biphenyl, or asbestos-containing materials, (iv) shall cause any
     improvements to or alterations of the Leased Property made by Tenant or its
     agents to comply with the Hazardous Materials Laws.

          (b) Tenant agrees to protect, defend, indemnify and hold harmless
     Landlord, its directors, officers, members, partners, shareholders,
     employees and agents, and any successors and assigns of Landlord from and
     against any and all liability, including all foreseeable and unforeseeable
     damages, including but not limited to attorneys' and consultants' fees,
     fines, penalties and civil or criminal damages, the cost of any required or
     necessary repair, response action, remediation, investigation, cleanup or
     detoxification and the preparation of any closure or other required plans,
     directly or indirectly arising out of (i) Tenant's violation of Section
     4.5(a) above or (ii) use, generation, storage, treatment, release,
     discharge, presence or disposal of Hazardous Material from, on, at, to, or
     under the Leased Property by Tenant, any Tenant Related Party, or any agent
     of Tenant or any Tenant Related Party, before or during the Term. This
     agreement to indemnify and hold harmless shall be in addition to any other
     obligations or liabilities Tenant may have to Landlord at common law under
     all statutes and ordinances or otherwise, and shall survive following the
     date of expiration or earlier termination of this Lease. Tenant expressly
     agrees that the representations, warranties and covenants made and the
     indemnities stated in this Lease are not personal to Landlord, and the
     benefits under this Lease may be assigned to subsequent parties in interest
     to the chain of title to the Leased Property, which subsequent parties in
     interest may proceed directly against Tenant to recover pursuant to this
     Lease.

          (c) Tenant shall promptly notify Landlord in writing upon Tenant's
     learning of any:

               (i) notice or claim to the effect that Tenant is or may be liable
          to any Person as a result of the presence upon or release or
          threatened release of any Hazardous Material into the environment from
          the Leased Property;


                                      -23-

<PAGE>

               (ii) notice that any Property is subject to investigation by any
          Governmental Authority evaluating whether any remedial action is
          needed to respond to the release or threatened release of any
          Hazardous Material into the environment from such Property or any
          portion thereof;

               (iii) notice that the Leased Property or any portion thereof is
          subject to any environmental lien; and

               (iv) notice of violation to Tenant under any applicable Hazardous
          Material Law that could have a material adverse effect upon the Leased
          Property or any portion thereof.

     4.6 MOLD. Tenant shall be responsible for taking all reasonable and timely
measures in the ordinary course of business to detect, prevent, and abate the
growth of Mold within the Leased Improvements.

                                    ARTICLE 5

                             MAINTENANCE AND REPAIRS

     5.1 TENANT'S GENERAL OBLIGATIONS. Subject to Landlord's obligations under
Section 5.2 below, Tenant shall keep the Leased Property in good operating
condition and in good order and repair (whether or not the need for such repairs
occurs as a result of Tenant's use, any prior use, the elements, the age of the
Leased Property or any portion thereof) and, subject to Landlord's election to
perform certain work as set forth in Section 5.2(c), shall promptly make all
necessary and appropriate repairs thereto of every kind and nature, whether
interior or exterior, structural or non-structural, ordinary or extraordinary,
foreseen or unforeseen or arising by reason of a condition existing prior to the
commencement of the Term (concealed or otherwise). All repairs, to the extent
reasonably achievable, shall be at least equivalent in quality to the original
work. All repairs shall be made in a good, workmanlike manner, consistent with
industry standards for like properties in like locations, in accordance with all
applicable Legal Requirements. Tenant's obligations under this Section 5.1 shall
be limited in the event of any casualty or Condemnation as set forth in Articles
10 and 11. The cost of all routine maintenance, repairs, and minor alterations
which can be expensed under GAAP shall be paid by Tenant, and shall be treated
as a component of Operating Expenses.

     5.2 CAPITAL REPAIRS AND REPLACEMENTS.

          (a) Landlord agrees to establish and maintain a ledger account (a
     "Capital Expenditure Reserve") to be used for the purpose of funding the
     cost of capital repairs, replacements and renewals to the Leased Property
     necessary to cause the Projects to comply with the standards described in
     Section 5.1, including major repairs, alterations, improvements, renewals
     or replacements to the structure, roof, or exterior facade of the Leased
     Improvements and to the mechanical, electrical, heating, ventilating, air
     conditioning, plumbing, and vertical transportation systems of the Leased
     Improvements (hereinafter referred to as "Major Repairs"), as well as
     routine repairs and replacements of furnishings, fixtures and equipment,
     including routine repairs and replacements to the


                                      -24-

<PAGE>

     mechanical, electrical, heating, ventilating, air conditioning and plumbing
     systems, and routine maintenance to the Leased Improvements, which are
     normally capitalized under GAAP (hereinafter referred to as "Routine
     Repairs"). During the Fixed Term, Landlord agrees to allocate annually to
     the Capital Expenditure Reserve an amount equal to not less than the
     product of $125.00 times the number of beds within the Leased Improvements
     (i.e., initially $736,750.00 per annum, based on 5,894 beds). During any
     Extension Term, the minimum annual amount to be allocated to the Capital
     Expenditure Reserve shall be adjusted by an amount which reflects any
     increase or decrease in the Consumer Price Index during the preceding five
     (5) year period, as calculated in the manner set forth in Section 3.3(a)
     hereof. In addition, in the event of the termination of this Lease with
     respect to any individual Property pursuant to the terms of Section 2.4(b),
     Article 10, Article 11, Section 15.2, or Section 15.4 hereof, the minimum
     annual allocation to the Capital Expenditure Reserve shall be adjusted to
     reflect the applicable reduction in the number of beds within the Leased
     Improvements. Any portion of Capital Expenditure Reserve which is not
     actually disbursed by Landlord during a Fiscal Year for Approved Capital
     Expenditures as described below shall remain available to Tenant for use
     during any subsequent Fiscal Year.

          (b) Each year, on or before November 1, Tenant shall prepare and
     submit to Landlord for its review and approval a budget (the "Capital
     Expenditure Budget") for both Routine Repairs and Major Repairs which
     Tenant believes are necessary or desirable to be made with respect to each
     of the Properties during the ensuing Fiscal Year (presented on both an
     annual and monthly basis) in order to maintain the Projects in the
     condition required by Section 5.1 above. In the event that such Capital
     Expenditure Budget includes any Major Repairs, Tenant shall be entitled to
     include a reasonable construction supervision fee for itself in such
     Capital Expenditure Budget with respect to such Major Repairs. Landlord's
     approval of such proposed Capital Expenditure Budget shall not be
     unreasonably withheld or delayed. In the event Landlord shall fail to
     respond within fifteen (15) days after receipt of a proposed Capital
     Expenditure Budget, then such Capital Expenditure Budget shall be deemed
     approved by Landlord. All Capital Expenditures proposed by Tenant shall be
     (as to both the amount of each such expenditure and the timing thereof)
     both reasonable and necessary, given the objective that each Project will
     be maintained and operated to a standard comparable to competitive
     apartment complexes and in good order and repair. Tenant agrees to
     incorporate all reasonable revisions to any proposed Capital Expenditures
     Budget which are required by Landlord. Upon approval of a proposed Capital
     Expenditure Budget by Landlord, Landlord shall submit such Capital
     Expenditure Budget to any Project Mortgagee (including the Existing Lender)
     which may have the right to review and approve such budget. Landlord shall
     be responsible for obtaining approval of any such Capital Expenditure
     Budget by any such Project Mortgagee.

          (c) Tenant shall, consistent with the Capital Expenditure Budgets
     approved by Landlord and, if applicable, any Project Mortgagee, from time
     to time make Routine Repairs and Major Repairs to the Leased Property,
     except to the extent that in the case of a Major Repair, Landlord elects to
     be responsible for the performance of such work. Tenant shall not
     materially deviate from any Capital Expenditure Budget approved by Landlord
     or any Project Mortgagee (including the Existing Lender) without the prior


                                      -25-

<PAGE>

     approval of Landlord, except in the case of emergency where immediate
     action is necessary to prevent imminent danger to person or property or to
     comply with any applicable Legal Requirements.

          (d) The cost of all Capital Expenditures incurred pursuant to an
     approved Capital Expenditure Budget or otherwise approved or authorized
     pursuant to subsection (c) above ("Approved Capital Expenditures") shall be
     funded by Landlord. In the event the existing amount allocated to the
     Capital Expenditure Reserve plus the minimum amounts to be allocated
     thereto for the Fiscal Year of the approved Capital Expenditure Budget are
     not sufficient to fully fund all such Approved Capital Expenditures for any
     Fiscal Year, Landlord shall increase the amount allocated to the Capital
     Expenditure Reserve for such Fiscal Year in order to fully fund the
     approved Capital Expenditure Budget. Upon Tenant's written request for
     disbursement, Landlord shall disburse funds to or for the account of
     Tenant, to pay for or to reimburse Tenant for such Approved Capital
     Expenditures, upon satisfaction of the conditions set forth in Section 5.3.

          (e) Landlord shall not be obligated to fund the costs of Capital
     Expenditures in excess of amounts included from time to time in the
     approved Capital Expenditure Budget for any Fiscal Year unless such Capital
     Expenditures are expressly approved in advance by Landlord or unless such
     expenditures are incurred by Tenant in an emergency situation where
     immediate action is necessary to prevent imminent danger to person or
     property or to comply with any applicable Legal Requirements. Tenant shall
     not make any capital replacements, repairs or alterations to the Leased
     Property without Landlord's prior written consent unless such replacement,
     repair or alteration is made pursuant to an approved Capital Expenditure
     Budget or is required in order to prevent imminent danger to person or
     property or to comply with any applicable Legal Requirements.

     5.3 CONDITIONS TO CAPITAL EXPENDITURE REIMBURSEMENTS. Upon Tenant's
request, Landlord shall pay for or reimburse Tenant for Approved Capital
Expenditures incurred by Tenant upon satisfaction of each of the conditions set
forth below (provided that nothing herein shall require Tenant to advance any
funds for Major Repairs):

          (a) Except as provided in this Section 5.3, each request for funds
     shall be made only after completion of the capital repairs, replacements or
     alterations (the "Work") for which disbursement is requested.

          (b) If the contractor performing such Work requires periodic payments
     pursuant to the terms of a written contract, a request for funds may be
     made after completion of a portion of the work under such contract,
     provided (v) such contract requires payment upon completion of such portion
     of the work, (w) the materials for which the request is made are on site at
     the applicable individual Project and are properly secured or have been
     installed in the applicable individual Project, (x) all other conditions in
     this Section 5.3 for disbursement have been satisfied and (y) if required
     by Landlord, each contractor or subcontractor receiving payments under such
     contract shall provide a waiver of lien with respect to amounts which have
     been paid to that contractor or subcontractor.


                                      -26-

<PAGE>

     (c) Each disbursement of funds, except for a final disbursement, shall be
in the amount of actual costs incurred for completed Work (as certified by an
approved architect, if applicable), less a retainage equal to ten percent (10%)
of such costs incurred in the case of projects having a cost in excess of
$50,000, until such Work has been completed. The retainage shall in no event be
less than the percentage of such costs that the contract with the relevant
contractor or supplier specifies to be retained and advanced as part of the
final disbursement. No funds will be advanced for materials stored at any
individual Project unless such materials are properly stored and secured at such
individual Project in accordance with sound construction practices as reasonably
determined by Landlord. The retainage shall not be released until the Tenant or,
if applicable, an approved architect certifies to Landlord that the Work has
been completed substantially in accordance with the provisions of this Section
5.3 and that all material approvals necessary at such individual Project have
been obtained from all appropriate Governmental Authorities, and Landlord
receives evidence reasonably satisfactory to Landlord that the costs of the Work
have been paid in full or will be paid in full out of the retainage.

     (d) The amount of all invoices in connection with the Work with respect to
which a disbursement is requested and which has been approved by Landlord shall
be disbursed by Landlord either directly to the Tenant (in which event, such
Tenant covenants and agrees to promptly pay such invoices) or, if an Event of
Default has occurred and is continuing, at Landlord's option and in Landlord's
sole and absolute discretion, directly to the contractor, supplier, materialman,
mechanic or subcontractor indicated on said invoices unless already paid by
Tenant and Landlord has received satisfactory evidence of such payment in which
case Landlord shall reimburse Tenant. In the event that Tenant requests that any
amounts be disbursed directly to Tenant pursuant to the foregoing sentence,
Tenant shall be required to deliver evidence reasonably acceptable to Landlord
of payment of all invoices for which disbursements were previously made to
Tenant as a condition to such requested disbursement.

     (e) No more than one disbursement per Property will be made by Landlord in
any calendar month.

     (f) Except to the extent such item is already contained in an approved
Capital Expenditure Budget, Landlord reserves the right, at its option and as a
condition to the funding of any Capital Expenditures, to approve (1) all
drawings and plans and specifications, if any, for any Work which requires
aggregate payments in amounts exceeding $50,000, and (2) all contracts and work
orders with materialmen, mechanics, suppliers, subcontractors, contractors and
other parties providing labor or materials in connection with any Work which
requires aggregate payments in amounts exceeding $50,000. Any such approval
shall not be unreasonably withheld, conditioned or delayed and shall be deemed
given if Landlord fails to respond within fifteen (15) Business Days after
Landlord receives all information reasonably required to adequately review such
drawings, plans and specifications, contracts or work orders.

     (g) For any Work which requires aggregate payments in amounts exceeding
$50,000 or is structural in nature or relates to the life safety systems at any
individual


                                      -27-

<PAGE>
     Project, Landlord may require an inspection of such individual Project
     prior to making a monthly disbursement in order to verify completion of the
     Work for which disbursement is sought. Landlord may require that such
     inspection be conducted by an appropriate independent qualified architect
     or engineer selected by Landlord and/or may require a copy of a certificate
     of completion by an independent qualified architect or engineer licensed in
     the state where the applicable individual Project is located and otherwise
     acceptable to Landlord prior to funding the cost of such Work.

     5.4 ADDITIONAL PROVISIONS RELATING TO CAPITAL REPAIRS AND REPLACEMENTS.

          (a) In the event Landlord determines in its reasonable discretion that
     any Work being performed by or under the supervision of Tenant is not being
     performed in a workmanlike or timely manner or that any such Work has not
     been completed in a workmanlike manner, Landlord shall have the option to
     withhold disbursement for such unsatisfactory Work and so notify Tenant
     with reasonable detail regarding the basis for Landlord's dissatisfaction
     and, after the expiration of thirty (30) days from the giving of such
     Notice by Landlord to Tenant of such unsatisfactory Work without the cure
     thereof (or, if such unsatisfactory Work is susceptible of a cure but
     cannot reasonably be cured within said thirty (30) day period and provided
     that Tenant shall have commenced to cure such unsatisfactory Work within
     said thirty (30) day period and thereafter diligently and expeditiously
     proceeds to cure the same, after the expiration of such longer period as is
     reasonably necessary for Tenant in the exercise of due diligence to cure
     such unsatisfactory Work, up to a maximum of an additional sixty (60) days,
     without the cure thereof), Landlord may proceed under existing contracts or
     contract with third parties to complete such Work, as the case may be, and
     apply a portion of the Capital Expenditure Reserve toward the labor and
     materials necessary to complete the same, without providing any additional
     prior Notice to Tenant, and exercise any and all other remedies available
     to Landlord upon and during the continuance of an Event of Default
     hereunder. Any dispute between Landlord and Tenant under this Section
     5.4(a) shall be subject to arbitration in accordance with Article 25 below
     at the request of either party.

          (b) Tenant shall permit Landlord, any Project Mortgagee, and their
     respective agents and representatives (including, without limitation,
     Landlord or said Project Mortgagee's engineer, architect or inspector) or
     third parties performing any Work on behalf of Landlord pursuant to this
     Section 5.4 or otherwise to enter onto any individual Property during
     normal business hours upon reasonable prior notice (subject to the rights
     of subtenants under their leases) to inspect the progress of any Work and
     all materials being used in connection therewith, to examine all plans and
     shop drawings relating thereto which are or may be kept at the Property,
     and to complete any Work as permitted under this Section 5.4. Tenant shall
     cause all of its contractors and subcontractors to cooperate with Landlord
     or Landlord's representatives or such other persons described above in
     connection with inspections described in this Section 5.4(b) or the
     completion of the Work pursuant to Section 5.4(a). In the event Landlord
     elects to perform or be responsible for the performance of any Major
     Repairs to any Property, Landlord (i) shall perform such work in a good and
     workmanlike manner, consistent with industry standards for like properties
     in like locations, in accordance with all


                                      -28-
<PAGE>

applicable Legal Requirements, (ii) shall coordinate the scheduling of such Work
with Tenant, (iii) shall use its best efforts to minimize any interference with
Tenant's operations at such Property in the performance of such Work, and (iv)
shall indemnify Tenant from any and all actions, claims, costs, and expenses,
including personal injury and property damage, resulting from the negligent
actions of Landlord, its agents, contractors, or employees, as well as from
Landlord's failure to perform such Work in accordance with the requirements of
(i) and (iii) above.

     (c) All Work and all materials, equipment, fixtures and any other items
comprising a part thereof shall be constructed, installed or completed by
Landlord or Tenant, as applicable, free and clear of all mechanic's,
materialman's or other liens (subject, in the case of any such Work performed by
Tenant, to Landlord's obligation to fund the cost of such Work in accordance
with Sections 5.2 and 5.3.

                                    ARTICLE 6

                              INTENTIONALLY OMITTED

                                    ARTICLE 7

                                      LIENS

     Subject to the provisions of Article 8 relating to permitted contests,
Tenant will not directly or indirectly create and will promptly discharge any
lien, encumbrance, attachment, title retention agreement or claim upon the
Leased Property, or any part thereof or upon Tenant's leasehold estate
hereunder, that arises from the use or occupancy of the Leased Property by
Tenant or, subject to Landlord's funding of Approved Capital Expenditures
pursuant to Section 5.2, by reason of any labor, service or material furnished
or claimed to have been furnished to or for the benefit of Tenant or by reason
of any construction or repairs by or at the direction of Tenant of all or any
part of the Leased Improvements. Nothing herein shall obligate Tenant to
discharge (a) restrictions, liens and other encumbrances which are consented to
in writing by Landlord, (b) liens for those taxes of Landlord which Tenant is
not required to pay hereunder, (c) liens for Impositions or for sums resulting
from noncompliance with Legal Requirements so long as (1) the same are not yet
payable or are payable without the addition of any fine or penalty or (2) such
liens are in the process of being contested as permitted by Article 8, (d) liens
of mechanics, laborers, materialmen, suppliers or vendors engaged by Tenant for
sums either disputed or not yet due, provided that (1) the payment of such sums
shall not be postponed for more than sixty (60) days after the completion of the
action giving rise to such lien and such reserve or other appropriate provisions
as shall be required by law or GAAP shall have been made therefor or (2) any
such liens are in the process of being contested as permitted by Article 8, (e)
liens of mechanics, laborers, materialmen, suppliers or vendors engaged by
Landlord, and (f) any liens which are the responsibility of Landlord pursuant to
the provisions of Article 15 of this Lease. Unless otherwise expressly provided
herein, Tenant shall not mortgage or grant any interest in, or otherwise assign,
any part of the Tenant's rights and interests in this Lease, the Leased Property
or any permits, licenses, or any other approvals required to operate the Leased


                                      -29-

<PAGE>

Property during the Term without the prior written consent of the Landlord,
which may be withheld at Landlord's sole discretion.

                                    ARTICLE 8

                               PERMITTED CONTESTS

     Tenant shall have the right to contest the amount or validity of any
Imposition, Legal Requirement, Insurance Requirement, lien, attachment, levy,
encumbrance, charge or claim (collectively, "Claims") as to the Leased Property,
by appropriate legal proceedings conducted in good faith and with due diligence,
provided that (a) Tenant shall give Landlord prior written notice of each such
contest, (b) the foregoing shall in no way be construed as relieving, modifying
or extending Tenant's obligation to pay any Claims which are Tenant's
obligations as finally determined, (c) such contest shall be permitted under any
Project Mortgage encumbering the affected Property, and any conditions or
requirements of any applicable Project Mortgagee shall be satisfied, (d) no part
of the Leased Property nor any Rent therefrom shall be in any immediate danger
of sale, forfeiture, attachment or loss, and (e) Tenant shall indemnify and hold
harmless Landlord from and against any cost, claim, damage, penalty or
reasonable expense, including reasonable attorneys' fees, incurred by Landlord
in connection therewith or as a result of Tenant's exercise of its rights under
this Article 8. Any compromise or settlement of any such contest shall be
subject to the prior written approval of Landlord, which approval shall not be
unreasonably withheld, delayed or conditioned. Landlord agrees to join in any
such proceedings if required legally to prosecute such contest, provided that
Landlord shall not thereby be subjected to any liability therefor (including,
without limitation, for the payment of any costs or expenses in connection
therewith) unless Tenant agrees, by agreement in form and substance reasonably
satisfactory to Landlord, to assume and indemnify Landlord with respect to the
same. Tenant shall be entitled to any refund of any Claims and such charges and
penalties or interest thereon which have been paid by Tenant or paid by Landlord
to the extent that Landlord has been fully reimbursed by Tenant. If Tenant shall
fail (x) to pay or cause to be paid any Claims which are Tenant's obligation
when finally determined, (y) to provide reasonable security therefor, or (z) to
prosecute or cause to be prosecuted any such contest diligently and in good
faith, Landlord may, upon reasonable notice to Tenant (which notice shall not be
required if Landlord shall reasonably determine that the same is not
practicable), pay such charges, together with interest and penalties due with
respect thereto, and Tenant shall reimburse Landlord therefore, upon demand, as
Additional Charges.

                                    ARTICLE 9

                                    INSURANCE

     9.1 GENERAL INSURANCE REQUIREMENTS. During the Term, Tenant shall at all
times keep the Leased Property insured against loss or damage from such causes
as are customarily insured against by prudent owners of similar facilities,
including the insurance described below. All insurance shall be written by
insurance companies (i) that have a claims paying ability rating by Standard &
Poor's Rating Services of not less than "BBB," by Moody's Investors Services,
Inc. of not less than "BA3," and by Fitch, Inc. of not less than "AA," an A.M.
Best Company, Inc. rating of not less than A- and a financial size category of
not less than X, or such higher ratings


                                      -30-

<PAGE>

as may be required by any Project Mortgagee, including Existing Lender with
respect to the Properties which are subject to the Existing Mortgage Loan, and
(ii) authorized, licensed and qualified to do insurance business in the state in
which the insured Property is located. All liability policies must name Landlord
and its directors, officers, members, partners, employees, agents (and any other
entities as Landlord may deem necessary) as an additional insured and losses
under any property insurance policy shall be payable to Landlord and/or Tenant
as provided in Article 10. Each insurance policy required hereunder must (i)
provide primary insurance without right of contribution from any other insurance
carried by Landlord, (ii) contain an express waiver by the insurer of any right
of subrogation, setoff or counterclaim against any insured party thereunder
including Landlord, (iii) permit Landlord to pay premiums at Landlord's
discretion, and (iv) as respects any third party liability claim brought against
Landlord, obligate the insurer to defend Landlord as an additional insured
thereunder. In addition, the policies of property insurance shall name any
Project Mortgagee as a mortgagee and loss payee, as its interest may appear, and
shall contain a standard "non-contributory mortgagee" endorsement or its
equivalent. Evidence of insurance shall be provided to Landlord and, if
requested, to any Project Mortgagee(s). If any provision of any Project Mortgage
which constitutes a first lien on the Leased Property requires deposits of
insurance premiums to be made with such Project Mortgagee, Tenant shall either
pay to Landlord monthly the amounts required and Landlord shall transfer such
amounts to such Project Mortgagee or, pursuant to written direction by Landlord,
Tenant shall make such deposits directly with such Project Mortgagee, as
described in Section 3.6 hereof. The policies on the Leased Property shall
insure against the following risks:

          (a) All Risk or Special Form Property insurance against loss or damage
     to buildings and improvements, including but not limited to, perils of
     fire, lightning, water, wind, theft, vandalism and malicious mischief,
     plate glass breakage, and perils typically provided under an Extended
     Coverage Endorsement and other forms of broadened risk perils, and insured
     on a "replacement cost" value basis to the extent of the full replacement
     value of the Leased Improvements located on each Leased Property. The
     policy shall include coverage for subsidence (not including "man-made
     subsidence), building ordinance and law (including demolition costs and
     increased cost of construction coverage), and "acts of terrorism" as
     defined in the Terrorism Risk Insurance Act of 2002. Such policy shall be
     in an amount not less than necessary to comply with any coinsurance
     percentage stipulated in the policy, but not less than 100% of the Full
     Replacement Cost of all Leased Improvements within the Leased Property
     (without any deduction for depreciation) unless otherwise approved by
     Landlord (such approval not to be unreasonably withheld) and any applicable
     Project Mortgagee. The deductible amount under such policy shall be borne
     by the Tenant as an Operating Expense in the event of a loss and the
     deductible must not exceed Twenty Five Thousand and 00/100 Dollars
     ($25,000.00) per occurrence. Further, in the event of a loss, Tenant shall
     abide by all provisions of the insurance contract, including proper and
     timely notice of the loss to the insurer, and Tenant further agrees that it
     will notify Landlord of any loss in the amount of Fifty Thousand and 00/100
     Dollars ($50,000.00) or greater and that no claim at or in excess of Two
     Hundred Thousand and 00/100 Dollars ($200,000.00) thereunder shall be
     settled without the prior written consent of Landlord, which consent shall
     not be unreasonably withheld or delayed by Landlord.


                                      -31-

<PAGE>

          (b) Broad form boiler and machinery insurance in an amount equal to
     the full replacement cost of the Leased Improvements at each individual
     Property (without any deduction for depreciation) in which the boiler or
     similar vessel is located, and including coverage against loss or damage
     from (1) leakage or sprinkler systems and (2) damage, breakdown or
     explosion of steam boilers, electrical machinery and equipment, air
     conditioning, refrigeration, pressure vessels or similar apparatus and
     mechanical objects now or hereafter installed at the Properties.

          (c) If an individual Property is located in an area prone to
     geological phenomena, including, but not limited to, sinkholes, mine
     subsidence, tidal waves or earthquakes, insurance for such individual
     Property covering such risks in an amount not less than 100% of the Full
     Replacement Cost of the Leased Improvements at such individual Property
     without any deduction for depreciation, or such other amount as is approved
     by Landlord (such approval not to be unreasonably withheld) and any
     applicable Project Mortgagee, with a maximum permissible deductible of
     $25,000, or such other amount as is approved by Landlord from time to time.

          (d) Flood insurance for any individual Property which is located, in
     whole or in part, in an area now or hereafter designated as "flood prone"
     or a "special flood hazard area" (as defined under the National Flood
     Insurance Act of 1968, the Flood Disaster Protection Act of 1973 or the
     National Flood Insurance Reform Act of 1994 (as each may be amended, or any
     successor law, collectively, the "Flood Insurance Acts")). Such policy
     shall be in an amount equal to 100% of the Full Replacement Cost of the
     Leased Improvements at such individual Property, or such other amount as is
     approved by Landlord (such approval not to be unreasonably withheld) and
     any applicable Project Mortgagee from time to time, and shall have a
     maximum permissible deductible equal to an amount customarily required by
     institutional lenders for similar properties in the general vicinity of
     such individual Property, but in no event in excess of $5,000, or such
     other amount as is approved by Landlord (such approval not to be
     unreasonably withheld) and any applicable Project Mortgagee from time to
     time.

          (e) Business interruption or rent loss insurance in an amount equal to
     the gross income or rentals from the Leased Property for an indemnity
     period of eighteen (18) months, such amount being adjusted annually.

          (f) During any period of reconstruction, renovation or alteration of
     any of the Properties, a complete value, "All Risks" Builders Risk form or
     "Course of Construction" insurance policy in non-reporting form and in an
     amount reasonably satisfactory to Landlord.

          (g) Worker's compensation insurance covering all persons employed by
     Tenant at the Leased Property with statutory limits and otherwise with
     limits of and provisions in accordance with the requirements of applicable
     local, state and federal law, and employer's liability insurance with
     maximum limits of One Million and 00/100 Dollars ($1,000,000.00) per
     accident or disease.


                                      -32-

<PAGE>

          (h) Automobile and vehicle liability insurance coverage for all owned,
     non-owned, leased or hired automobiles and vehicles in a primary limit of
     One Million and 00/100 Dollars ($1,000,000.00) per occurrence for bodily
     injury and an annual aggregate policy limit of One Million and 00/100
     Dollars ($1,000,000.00) per Project.

          (i) Commercial General Liability in a primary amount of at least One
     Million and 00/100 Dollars ($1,000,000.00) per occurrence, bodily injury
     and property damage combined, and Two Million and 00/100 Dollars
     ($2,000,000.00) general aggregate per Project, with a deductible or
     self-insurance retention no greater than Twenty Five Thousand and 00/100
     Dollars ($25,000.00). This coverage shall also include blanket contractual
     liability, including Tenant's indemnification as set forth in this Lease,
     and products/completed operations liability coverage for a period of at
     least two (2) years after termination of this Lease.

          (j) Umbrella liability insurance in the minimum amount of Twenty Five
     Million and 00/100 Dollars ($25,000,000.00) for each occurrence and
     aggregate combined single limit for all liability.

          (k) Such other insurance and endorsements, if any, with respect to the
     Leased Property and the operation thereof as Landlord may reasonably
     require from time to time, provided same are customarily required by
     institutional owners of similar properties in the general vicinity of the
     Properties, or which are otherwise required by any applicable Project
     Mortgagee.

The term "Full Replacement Cost" as used herein, shall mean the actual
replacement cost of the subject Property, including an increased cost of
construction endorsement, less exclusions provided in the standard form of
special form insurance policy. In the event either Landlord or Tenant believes
that the Full Replacement Cost for any Project has increased or decreased at any
time during the Term, it shall have the right to have such Full Replacement Cost
re-determined by an independent accredited appraiser approved by the other
party, which approval shall not be unreasonably withheld or delayed, hereinafter
referred to as the "impartial appraiser." The party desiring to have the Full
Replacement Cost so re-determined shall forthwith, on receipt of such
determination by such impartial appraiser, give written notice thereof to the
other party hereto. The determination of such impartial appraiser shall be final
and binding on the parties hereto, and Tenant shall forthwith increase, or may
decrease, the amount of the insurance carried pursuant to this Article 9, as the
case may be, to the amount so determined by the impartial appraiser. Tenant
shall pay the fee, if any, of the impartial appraiser.

Notwithstanding anything to the contrary hereinabove provided, except as
otherwise required by any applicable Project Mortgagee(s), Tenant's obligation
to maintain the coverages, limits, and deductibles described in this Section 9.1
and in Section 9.4 below shall be subject to the availability of such coverages,
limits, and deductibles for similar kinds of properties in the general vicinity
of the Properties at commercially reasonable premiums. Subject to the consent of
any applicable Project Mortgagee(s), to the extent that the coverages, limits
and deductibles specified hereinabove and in Section 9.4 are not available at
commercially reasonable premiums for similar types of properties in the
locations of the Properties, Landlord and Tenant shall endeavor to agree upon
the proper and reasonable coverages, limits, and deductibles to be


                                      -33-

<PAGE>

maintained, based upon the insurance programs typically required by
institutional investors and permanent lenders for similar types of properties in
the vicinity of the Properties. If the parties shall be unable to agree thereon,
the proper and reasonable coverages, limits and deductibles shall be determined
by reference to such standard by arbitration pursuant to the provisions of
Article 24 below.

     9.2 ADDITIONAL INSURANCE. In addition to the insurance described above,
Tenant shall maintain such additional insurance as may be required from time to
time by any Project Mortgagee.

     9.3 WAIVER OF SUBROGATION. Anything in this Lease to the contrary
notwithstanding, Tenant hereby releases and waives unto Landlord (including all
partners, members, managers, stockholders, officers, directors, employees and
agents thereof), its successors, and assigns, and Landlord hereby releases and
waives unto Tenant (including all partners, members, managers, stockholders,
officers, directors, employees and agents thereof), its successors and assigns,
all rights to claim damages for any injury, loss, cost or damage to persons or
to the Leased Property or any other casualty, as long as the amount of such
injury, loss, cost or damage has been paid either to Landlord, Tenant, or any
other person, firm or corporation, under the terms of any property, commercial
general liability, or other policy of insurance, to the extent such releases or
waivers are permitted under applicable law. As respects all policies of
insurance carried or maintained pursuant to this Lease and to the extent
permitted under such policies, Landlord and Tenant each waive the insurance
carriers' rights of subrogation.

     9.4 FORM OF INSURANCE. All of the policies of insurance referred to in this
Article 9 shall be written in form satisfactory to Landlord and by insurance
companies satisfactory to Landlord. Tenant shall pay all of the premiums
therefor, and shall deliver such original policies, or a certified copy thereof
(which is certified in writing by a duly authorized agent for the insurance
company as a "true and certified" copy of the policy) to Landlord effective with
the Commencement Date and furnished annually thereafter (and, with respect to
any renewal policy, evidence of such renewal prior to the expiration of the
existing policy) and in the event of the failure of Tenant either to obtain such
insurance in the names herein called for or to pay the premiums therefor, or to
deliver such policies or certified copies of such policies to Landlord at the
times required, Landlord shall be entitled, but shall have no obligation, to
obtain such insurance and pay the premiums therefor, which premiums shall be
repayable to Landlord upon written demand therefor, as Additional Charges,
together with a late charge at the Overdue Rate from the date such payment is
made until the date repaid. All insurance policies and renewals thereof (i)
shall provide for a term of not less than one year, (ii) shall provide for
claims to be made on an occurrence basis, and (iii) shall contain a statement of
values to be updated annually (if the amount of coverage under such policy is
based upon the replacement cost of any applicable individual Property). All
property damage insurance policies (except for flood and earthquake policies)
must automatically reinstate after each loss. Each insurer mentioned in this
Article 9 shall agree, by endorsement on the policy or policies issued by it, or
by independent instrument furnished to Landlord, that it will give to Landlord
thirty (30) days' prior written notice at Landlord's Notice Address before the
policy or policies in question shall be altered, allowed to expire or canceled.
The parties hereto agree that all insurance policies, endorsements and
certificates which provide that the insurer will "endeavor to" give notice
before same may be altered, allowed to expire or canceled will not be acceptable
to Landlord. Notwithstanding


                                      -34-

<PAGE>

anything contained herein to the contrary, all policies of insurance required to
be obtained by Tenant hereunder shall provide (i) that such policies will not
lapse, terminate, be canceled, or be amended or modified to reduce limits or
coverage terms unless and until Landlord has received not less than thirty (30)
days' prior written notice at Landlord's Notice Address, and (ii) that in the
event of cancellation due to non-payment of premium, the insurer will provide
not less than ten (10) days' prior written notice to Landlord at Landlord's
Notice Address.

     9.5 INCREASE IN LIMITS. In the event that Landlord shall at any time deem
the limits of the personal injury, property damage or general public liability
insurance then carried to be insufficient, the parties shall endeavor to agree
on the proper and reasonable limits for such insurance to be carried, based upon
limits typically required by institutional investors and permanent lenders for
similar properties in the general vicinity of the Properties, and such insurance
shall thereafter be carried by Tenant with the limits thus agreed on until
further change pursuant to the provisions of this Article 9. If the parties
shall be unable to agree thereon, the proper and reasonable limits for such
insurance to be carried shall be determined by an impartial third party selected
by the parties, and any limits of coverage in excess of such amounts shall be at
the sole cost and expense of Landlord. Notwithstanding anything to the contrary
hereinabove provided, Tenant shall at all times maintain such limits of coverage
as may be required by any applicable Project Mortgages, the costs of which shall
be treated as an Operating Expense.

     9.6 NO SEPARATE INSURANCE. Tenant shall not, on Tenant's own initiative or
pursuant to the request or requirement of any third party, take out separate
insurance concurrent in form or contributing in the event of loss with that
required in this Article 9 to be furnished by, or which may reasonably be
required to be furnished by, Tenant, or increase the amounts of any then
existing insurance by securing an additional policy or additional policies,
unless all parties having an insurable interest in the subject matter of the
insurance, including in all cases Landlord and all Project Mortgagees, are
included therein as additional insureds and the loss is payable under said
insurance in the same manner as losses are required to be payable under this
Lease. Tenant shall immediately notify Landlord of the taking out of any such
separate insurance or of the increasing of any of the amounts of the then
existing insurance by securing an additional policy or additional policies.

                                   ARTICLE 10

                                    CASUALTY

     10.1 INSURANCE PROCEEDS. All proceeds payable by reason of any loss or
damage to the Leased Property or any portion thereof and insured under any
policy of insurance required by Article 9 (other than the proceeds of any
business interruption or rent loss insurance, which shall be payable to Tenant)
shall be paid directly to Landlord (subject to the provisions of Section 10.2)
and all loss adjustments with respect to losses under such policies shall
require the prior written consent of Landlord; provided, however, that so long
as no Event of Default shall have occurred and be continuing, all such proceeds
less than or equal to Two Hundred Thousand and 00/100 Dollars ($200,000),
calculated on a Project-by-Project basis, shall be paid directly to Tenant and
such losses may be adjusted without Landlord's consent. If Tenant is required to
reconstruct or repair such Property as provided herein, such proceeds shall be
paid out by Landlord from time to time for the reasonable costs of such
reconstruction or repair, subject to


                                      -35-

<PAGE>

and in accordance with the provisions of Section 10.3. Any excess proceeds of
insurance remaining after the completion of the restoration or reconstruction of
the Leased Property shall be gross rentals under this Lease. All salvage
resulting from any risk covered by insurance also shall be treated as gross
rentals under this Lease, provided any rights to same have been waived by the
insurer.

     10.2 DAMAGE OR DESTRUCTION.

          10.2.1 Damage or Destruction of Leased Property. If, during the Term,
any Project shall be totally or partially destroyed and (i) is thereby rendered
Unsuitable for its Permitted Use, and (ii) in Tenant's reasonable estimate,
based on the evaluation of an independent architect engaged by Landlord to
evaluate such damage, cannot reasonably be expected to be restored to
substantially the same condition as existed immediately before such damage or
destruction within twelve (12) months following such damage or destruction, then
in such event Tenant may, by the giving of Notice thereof to the Landlord,
terminate this Agreement with respect to such Property, in which event this
Agreement shall terminate with respect to the affected Property, Landlord shall
be entitled to retain the insurance proceeds payable on account of such damage,
and Tenant shall pay to Landlord on demand as an Operating Expense the amount of
any deductible in connection therewith; and Tenant shall thereafter have no
obligation to pay the Base Rent allocable to such Property, as determined in
accordance with Section 3.3(c) hereof, for periods arising after the effective
date of such termination, and the Additional Rent Base shall be adjusted in
accordance with Section 3.4(b).

          10.2.2 Partial Damage or Destruction. If, during the Term, any Project
shall be totally or partially destroyed but such Project is not rendered
Unsuitable for its Permitted Use, or, if rendered Unsuitable for its Intended
Use, nevertheless in the opinion of the independent architect engaged by
Landlord to evaluate such damage reasonably can be expected to be restored to
the same condition as existed immediately before such damage or destruction
within twelve (12) months following such damage or destruction, Tenant or, if
Landlord so elects, Landlord shall promptly restore such Property as provided in
Section 10.3 unless this Agreement is terminated as to such Property as provided
in Section 10.2.3. Landlord shall be responsible for obtaining approval of any
such restoration from any Project Mortgagee and for coordinating the
disbursement of funds therefore from such Project Mortgagee.

          10.2.3 Insufficient Insurance Proceeds. If this Lease is not otherwise
terminated pursuant to this Article 10 and the cost of the repair or restoration
of any Property exceeds the amount of insurance proceeds received by Landlord
and Tenant from the insurance required under Article 9 plus the amount of any
deductible in connection therewith, Tenant shall give Landlord Notice thereof
which notice shall set forth in reasonable detail the nature of such deficiency
and whether Tenant shall pay and assume the amount of such deficiency (Tenant
having no obligation to do so). In the event Tenant shall elect not to pay and
assume the amount of such deficiency, Landlord shall have the right (but not the
obligation), exercisable at Landlord's sole election by Notice to Tenant, given
within sixty (60) days after Tenant's notice of the deficiency, to elect to make
available for application to the cost of repair or restoration the amount of
such deficiency. In the event that neither Landlord nor Tenant shall elect to
make such deficiency available for restoration, either Landlord or Tenant may
terminate this Agreement with respect to the affected Property by Notice to the
other, whereupon this


                                      -36-

<PAGE>

Agreement shall terminate with respect to the affected Property as provided in
Section 10.2.1, the Base Rent shall be reduced in accordance with Section 3.3(c)
hereof as of the effective date of such termination by the affected Property's
allocable share of such Base Rent, and the Additional Rent Base shall be
adjusted in accordance with Section 3.4(b).

     10.3 DISBURSEMENT OF PROCEEDS. In the event Tenant is required to restore
any Project pursuant to Section 10.2, Tenant shall commence promptly and
continue diligently to perform the repair and restoration of such Project
(hereinafter called the "Work") in a good and workmanlike manner, so as to
restore such Project in compliance with all Legal Requirements and so that such
Project shall be, to the extent practicable, substantially equivalent in value
and general utility to its general utility and value immediately prior to such
damage or destruction. Subject to the terms hereof, Landlord shall advance the
insurance proceeds and any additional amounts payable by Landlord pursuant to
Section 10.2.3 to Tenant regularly during the repair and restoration period so
as to permit payment for the cost of any such restoration and repair. Any such
advances shall be made not more than monthly within ten (10) Business Days after
Tenant submits to Landlord a written requisition and substantiation therefore on
AIA Forms G702 and G703 (or on such other form or forms as may be reasonably
acceptable to Landlord). Landlord may, at its option, condition advancement of
said insurance proceeds and other amounts on (i) the absence of any Event of
Default, (ii) its approval of plans and specifications of an architect
satisfactory to Landlord (which approval shall not be unreasonably withheld,
delayed or conditioned), (iii) general contractors' estimates, (iv) architect's
certificates, (v) unconditional lien waivers of general contractors, if
available, (vi) evidence of approval by all Governmental Authorities and other
regulatory bodies whose approval is required, and (vii) such other certificates
as Landlord may, from time to time, reasonably require, and (viii) such other
terms and conditions as the Project Mortgagee of such Project may require. In
the event Landlord elects to require Tenant to restore any Project pursuant to
Section 10.2 rather than perform such restoration itself, Tenant shall be
entitled to receive a reasonable construction supervision fee for Tenant's
services in connection with such restoration. In the event Landlord elects to
perform or be responsible for the performance of any such restoration, Landlord
(i) shall perform such Work in a good and workmanlike manner, in accordance with
all applicable Legal Requirements, (ii) shall coordinate the scheduling of such
Work with Tenant, (iii) shall use its best efforts to minimize any interference
with Tenant's operations at such Property in the performance of such work, and
(iv) shall indemnify Tenant from any and all actions, claims, costs, and
expenses, including personal injury and property damage, resulting from the
negligent actions of Landlord, its agents, contractors, or employees, as well as
Landlord's failure to perform such Work in accordance with the requirements of
(i) and (iii) above.

          Landlord's obligation to disburse insurance proceeds under this
Article 10 shall be subject to the release of such proceeds to Landlord by any
Project Mortgagee. If any Project Mortgagee shall be unwilling to disburse
insurance proceeds in accordance with the terms of this Agreement, Tenant shall
have the right, by the giving of Notice thereof to Landlord within ten (10)
Business Days after Tenant learns of such unwillingness, to treat such Project
as rendered Unsuitable for its Permitted Use for purposes of Section 10.2.1.
Tenant's obligation to restore the applicable Property pursuant to this Article
10 shall be subject to the release of available insurance proceeds by the
applicable Project Mortgagee to Landlord or directly to Tenant, and, in the
event such proceeds are insufficient, Landlord electing to make such deficiency
available therefor (and disbursement of such deficiency).


                                      -37-

<PAGE>

     10.4 NO ABATEMENT OF RENT. Unless terminated by either party pursuant to
this Article 10 (and then only with respect to the affected Property), this
Agreement shall remain in full force and effect and Tenant's obligation to make
all payments of Rent and to pay all other charges as and when required under
this Agreement shall remain unabated during the Term notwithstanding any damage
involving any Property, provided that (i) Landlord shall credit against such
payments any amounts paid to Landlord as a consequence of such damage under any
business interruption insurance obtained by Tenant hereunder, and (ii) in the
event that the Net Operating Income of the affected Property is insufficient to
pay the full Base Rent allocable to such Property because of such damage, the
period for payment of the Base Rent allocated to such Property, or an equitable
portion thereof, shall be extended until such time as the proceeds of Tenant's
business interruption or rent loss insurance are disbursed to Tenant or
Landlord. The provisions of this Article 10 shall be considered an express
agreement governing any cause of damage or destruction to any Property and, to
the maximum extent permitted by law, no local or state statute, laws, rules,
regulation or ordinance in effect during the Term which provide for such a
contingency shall have any application in such case.

     10.5 DAMAGE NEAR END OF TERM. Notwithstanding any provisions of Sections
10.2 or 10.3 to the contrary, if damage to or destruction of any Project occurs
during the last twelve (12) months of the Term (including any exercised
Extension Terms), and if such damage or destruction cannot reasonably be
expected to be fully repaired and restored prior to the date that is six (6)
months prior to the end of such Term, either party shall have the right to
terminate this Lease with respect to the affected Property by giving Notice to
the other within thirty (30) days after the date of damage or destruction, in
which event Landlord shall be entitled to retain the insurance proceeds and
Tenant shall pay to Landlord on demand as an Operating Expense the amount of any
deductible in connection therewith, and Tenant thereafter shall have no
obligation to pay the Base Rent allocable to such Property, as determined in
accordance with Section 3.3(c) hereof, for the period after the effective date
of such termination; provided, however, that if Tenant subsequently exercises an
available option to extend the Term of this Lease, any prior termination
election by either Landlord or Tenant shall be superseded, the affected Property
shall be reinstated as a part of the Leased Property as of the date of exercise
of Tenant's Extension Option (with Rent allocable to such Property to recommence
as of such date), and the affected Property shall be restored in accordance with
Section 10.2.2.

     10.6 WAIVER. Tenant hereby waives any statutory or common law rights of
termination which may arise by reason of any damage or destruction of any
Property or any portion thereof.

                                   ARTICLE 11

                                  CONDEMNATION

     11.1 DEFINITIONS.

          (a) "Condemnation" means (i) the exercise of any governmental power of
     eminent domain, whether by legal proceedings or otherwise, by a Condemnor
     or (ii) a voluntary sale or transfer by Landlord to any Condemnor, either
     under threat of Condemnation or while legal proceedings for Condemnation
     are pending.


                                      -38-

<PAGE>

          (b) "Date of Taking" means the date the Condemnor has the right to
     possession of the property being condemned.

          (c) "Award" means all compensation, sums or anything of value awarded,
     paid or received on a total or partial Condemnation of the Leased Property
     (after deduction of all reasonable legal fees and other costs and expenses,
     including, without limitation, expert witness fees, incurred by Landlord in
     connection with obtaining any such award).

          (d) "Condemnor" means any public or quasi-public authority, or private
     corporation or individual, having the power of Condemnation.

     11.2 TOTAL CONDEMNATION, ETC. If either (i) the whole of any Property shall
be taken by Condemnation or (ii) a Condemnation of less than the whole of any
Property renders such Property Unsuitable for its Permitted Use, this Agreement
shall terminate with respect to such Property, Tenant and Landlord shall seek
the Award for their interests in the applicable Property as provided in Section
11.6 and, as of the effective date that the Property is Unsuitable for its
Permitted Use or the Date of Taking, whichever is first to occur, Base Rent
payable hereunder shall be reduced by such Property's allocable share thereof in
accordance with Section 3.3(c) hereof, and the Additional Rent Base shall be
adjusted in accordance with Section 3.4(b).

     11.3 PARTIAL CONDEMNATION. In the event of a Condemnation of less than the
whole of any Property such that such Property is still suitable for its
Permitted Use, Tenant or, if Landlord so elects, Landlord shall, to the extent
of the Award actually received by Landlord and/or Tenant and any additional
amounts disbursed by Landlord as hereinafter provided, commence promptly and
continue diligently to restore the untaken portion of the Leased Improvements so
that such Leased Improvements shall constitute a complete architectural unit of
the same general character and condition (as nearly as may be possible under the
circumstances) as the Leased Improvements existing immediately prior to such
Condemnation, in full compliance with all Legal Requirements, subject to the
provisions of this Section 11.3. If Tenant is responsible for restoring the
Leased Improvements and the cost of the repair or restoration of such Property
exceeds the amount of the Award, Tenant shall give Landlord Notice thereof which
notice shall set forth in reasonable detail the nature of such deficiency and
whether Tenant shall pay and assume the amount of such deficiency (Tenant having
no obligation to do so, except that if Tenant shall elect to make such funds
available, the same shall become an irrevocable obligation of Tenant pursuant to
this Agreement). In the event Tenant shall elect not to pay and assume the
amount of such deficiency, Landlord shall have the right (but not the
obligation), exercisable at Landlord's sole election by Notice to Tenant given
within sixty (60) days after Tenant's Notice of the deficiency, to elect to make
available for application to the cost of repair or restoration the amount of
such deficiency. In the event that neither Landlord nor Tenant shall elect to
make such deficiency available for restoration, either Landlord or Tenant may
terminate this Agreement with respect to the affected Property, whereupon Tenant
and Landlord shall be entitled to seek the Award for their interests in the
applicable Property as provided in Section 11.6 and Tenant shall have no
obligation to pay Base Rent allocable to such Property, as determined with
Sections 3.3(c) hereof, and the Additional Rent Base shall be adjusted in
accordance with Section 3.4(b) hereof, for periods arising after the earlier of
the Date of Taking or the date that the Property is Unsuitable for its Permitted
Use.


                                      -39-

<PAGE>

     Subject to the terms hereof, Landlord shall contribute to the cost of
restoration that part of the Award necessary to complete such repair or
restoration, together with severance and other damages awarded for the taken
Leased Improvements and any deficiency Landlord has agreed to disburse, to
Tenant regularly during the restoration period so as to permit payment for the
cost of such repair or restoration. Landlord may, at its option, condition
advancement of such Award and other amounts on (i) the absence of any Event of
Default, (ii) its approval of plans and specifications of an architect
satisfactory to Landlord (which approval shall not be unreasonably withheld or
delayed), (iii) general contractors' estimates, (iv) architect's certificates,
(v) unconditional lien waivers of general contractors, if available, (vi)
evidence of approval by all Governmental Authorities and other regulatory bodies
whose approval is required, (vii) such other certificates as Landlord may, from
time to time, reasonably require, and (viii) such other terms and conditions as
the Project Mortgagee may require. In the event Landlord elects to require
Tenant to restore any Project pursuant to this Section 11.3 rather than perform
such restoration itself, Tenant shall be entitled to receive a reasonable
construction supervision fee in connection with Tenant's services. In the event
Landlord elects to perform or be responsible for the performance of any such
restoration, Landlord (i) shall perform such Work in a good and workmanlike
manner, in accordance with all applicable Legal Requirements, (ii) shall
coordinate the scheduling of such work with Tenant, (iii) shall use its best
efforts to minimize any interference with Tenant's operations at such Property
in the performance of such work, and (iv) shall indemnify Tenant from any and
all actions, claims, costs, and expenses, including personal injury and property
damage, resulting from the negligent actions of Landlord, its agents,
contractors, or employees, as well as from Landlord's failure to perform such
Work in accordance with the requirements of (i) and (iii) above. Landlord's
obligation under this Section 11.3 to disburse the Award and such other amounts
shall be subject to (x) the collection thereof by Landlord and (y) the release
of such Award by the applicable Project Mortgagee. If any Project Mortgagee
shall be unwilling to disburse Award proceeds in accordance with the terms of
this Agreement, Tenant shall have the right, by the giving of Notice thereof to
Landlord within ten (10) Business Days after Tenant learns of such
unwillingness, to treat such Property as rendered Unsuitable for its Permitted
Use for purposes of Section 11.2. Tenant's obligation to restore the Leased
Property shall be subject to the release of the Award by the applicable Project
Mortgagee to Landlord or directly to Tenant.

     11.4 ABATEMENT OF RENT. Unless terminated by either party pursuant to this
Article (and then only with respect to the affected Property), this Agreement
shall remain in full force and effect, provided that from and after the earlier
of the Date of Taking or the date that the Property is rendered Unsuitable for
its Permitted Use, Base Rent allocable to the affected Property and the
Additional Rent Base shall be equitably reduced taking into account all of the
relevant factors and circumstances.

     11.5 TEMPORARY CONDEMNATION. In the event of any temporary Condemnation of
any Property or Tenant's interest therein, this Agreement shall continue in full
force and effect and Tenant shall continue to pay, in the manner and on the
terms herein specified, the full amount of Rent, and the entire amount of any
Award made for such temporary Condemnation allocable to the Term shall be paid
to Tenant. Tenant or, if Landlord so elects, Landlord shall, promptly upon the
termination of any such period of temporary Condemnation, restore such Property
to the condition that existed immediately prior to such Condemnation, in full
compliance with all Legal Requirements, unless such period of temporary
Condemnation shall extend beyond the


                                      -40-

<PAGE>

expiration of the Term, in which event Tenant shall not be required to make such
restoration. If Tenant is required to so restore the Property, Tenant shall be
entitled to receive a reasonable construction supervision fee in connection with
Tenant's services. In the event Landlord elects to perform or be responsible for
the performance of any such restoration, Landlord (i) shall perform such work in
a good and workmanlike manner, in accordance with all applicable Legal
Requirements, (ii) shall coordinate the scheduling of such work with Tenant,
(iii) shall use its best efforts to minimize any interference with Tenant's
operations at such Property in the performance of such work, and (iv) shall
indemnify Tenant from any and all actions, claims, costs, and expenses,
including personal injury and property damage, resulting from the negligent
actions of Landlord, its agents, contractors, or employees, as well as from
Landlord's failure to perform such work in accordance with the requirements of
(i) and (iii) above. For purposes of this Section 11.5, a Condemnation shall be
deemed to be temporary if the period of such Condemnation is not expected to,
and does not, exceed twelve (12) months.

     11.6 ALLOCATION OF AWARD. Except as provided in Section 11.5 and the second
sentence of this Section 11.6, the total Award shall be solely the property of
and payable to Landlord. Any portion of the Award made for the taking of
Tenant's leasehold interest in any Property or loss of business during the
remainder of the Term shall be the sole property of and payable to Tenant
(subject to the provisions of Section 11.3). In any Condemnation proceedings,
Landlord and Tenant shall each seek its own Award in conformity herewith, at its
own expense. Landlord shall be responsible for obtaining approval of any
restoration work from any Project Mortgagee and for coordinating the
disbursement of funds therefor from such Project Mortgagee.

                                   ARTICLE 12

                                     DEFAULT

     12.1 EVENTS OF DEFAULT. The occurrence of any one or more of the following
events (individually, an "Event of Default") shall constitute Events of Default
hereunder:

          (a) if Tenant shall fail to make a payment of Rent or any other
     monetary payment due and payable by Tenant under this Lease when the same
     becomes due and payable and such failure shall continue without cure for a
     period of five (5) days after receipt of Notice of non-payment from
     Landlord; provided, however, Landlord shall not be required to give Notice
     of such failure more than twice in any calendar year; or

          (b) if Tenant shall fail to maintain the insurance coverages required
     under Article 9 and such failure shall continue for ten (10) Business Days
     after written Notice thereof (provided Tenant shall reimburse Landlord, at
     its own expense and not as an Operating Expense, for the cost of any
     insurance obtained by Landlord during such period in excess of the cost of
     the insurance obtained by Tenant); or

          (c) if Tenant shall fail to observe or perform any other term,
     covenant or condition of this Lease and such failure is not cured by Tenant
     within a period of thirty (30) days after receipt by Tenant of written
     Notice thereof from Landlord, unless such failure cannot with due diligence
     be cured within a period of thirty (30) days, in which case such failure
     shall not be deemed to continue if Tenant proceeds promptly and with


                                      -41-

<PAGE>

     due diligence to cure the failure and diligently completes the curing
     thereof within ninety (90) days after receipt by Tenant of Landlord's
     written Notice of default, or

          (d) if Tenant shall:

               (i) admit in writing its inability to pay its debts generally as
          they become due,

               (ii) file a petition in bankruptcy or a petition to take
          advantage of any insolvency act,

               (iii) make an assignment for the benefit of its creditors,

               (iv) consent to the appointment of a receiver of itself or of the
          whole or any substantial part of its property, or

               (v) file a petition or answer seeking reorganization or
          arrangement under the Federal bankruptcy laws or any other applicable
          law or statute of the United States of America or any state thereof,
          or

               (vi) be declared insolvent according to any law; or assignment of
          Tenant's property is made for the benefit of creditors; or

          (e) if a receiver or trustee is appointed for Tenant or its property;
     or the interest of Tenant under this Lease in any Property or any part
     thereof is levied on or attached under execution or other legal process; or
     any petition is filed by or against Tenant to declare Tenant bankrupt or
     insolvent, or seeking liquidation, reorganization, arrangement, adjustment,
     or composition of Tenant's debts under any laws relating to bankruptcy,
     insolvency, or reorganization or relief of debtors, or seeking the entry of
     an order for relief or the appointment of a receiver, trustee, custodian,
     or other similar official for Tenant or for any substantial part of the
     property of Tenant (provided that no such levy, execution, legal process or
     petition filed against Tenant shall constitute an Event of Default if
     Tenant shall contest the same by appropriate proceedings and shall remove
     or vacate the same within a reasonable time from the date of its creation,
     service or filing); or

          (f) if Tenant shall be liquidated or dissolved, or shall begin
     proceedings toward such liquidation or dissolution; or

          (g) if any of the representations or warranties made by Tenant under
     or in connection with this Lease or in any document or certificate
     delivered in connection herewith prove to have been false or misleading in
     any material respect on the date made or deemed made to the material
     adverse detriment of Landlord, and such adverse effect, to the extent same
     is capable of being cured or corrected, is not so cured or corrected within
     thirty (30) days after Notice from Landlord; or


                                      -42-

<PAGE>

          (h) the assignment, mortgage, pledge, hypothecation, or other transfer
     of this Lease or any interest of Tenant in the Leased Property in violation
     of the terms of Article 13 of this Lease; or

          (i) the failure of Tenant to provide the financial reports due under
     Section 14.3 hereof and such failure shall continue for ten (10) Business
     Days after written Notice thereof from Landlord; or

          (j) the failure of Tenant to restore any amount drawn by Landlord on
     the Letter of Credit or the Cash Collateral within ten (10) Business Days
     after Tenant's receipt of notice of a draw thereon by Landlord pursuant to
     Section 3.9(i) hereof.

     12.2 REMEDIES. If an Event of Default shall have occurred, Landlord shall
have the right at its election, then or at any time thereafter until such Event
of Default is cured or waived, to pursue any one or more of the following
remedies, in addition to any remedies which may be permitted by law, in equity
or by other provisions of this Lease, without further Notice or demand:

          (a) Landlord, with or without terminating this Lease and without
     waiving or releasing any obligation or Event of Default, may (but shall be
     under no obligation to) at any time thereafter make any payment or perform
     any act required to be made or performed under this Lease by Tenant for the
     account and at the expense of Tenant, and, to the extent permitted by law,
     may enter upon the Leased Property for such purpose and take all such
     action thereon as, in Landlord's opinion, may be necessary or appropriate
     therefor. No such entry shall be deemed an eviction of Tenant. All sums so
     paid by Landlord and all costs and expenses (including, without limitation,
     reasonable attorneys' fees and expenses, in each case, to the extent
     permitted by law) so incurred, together with a late charge thereon (to the
     extent permitted by law) at the Overdue Rate from the date on which such
     sums or expenses are paid or incurred by Landlord, shall be paid by Tenant
     to Landlord on demand.

          (b) Landlord shall be entitled to bring suit against Tenant for the
     performance of any non-monetary covenant or obligation of Tenant or to seek
     injunctive or other equitable relief with respect to any such default. In
     addition, Landlord shall be entitled to sue for and recover any actual
     damages incurred by Landlord as a result of any non-monetary default, and
     pursuit of any of the other remedies provided for in this Section 12.2
     shall not preclude pursuit of any such claim for actual damages.

          (c) Landlord may immediately or at any time thereafter terminate this
     Lease by written Notice to Tenant, in which event Tenant shall immediately
     surrender the Leased Property to Landlord, and if Tenant fails to do so,
     Landlord may, without prejudice to any other remedy which Landlord may have
     for possession or arrearages in Rent (including any late charges which may
     have accrued pursuant to Section 3.7), enter upon and take possession of
     the Leased Property and expel or remove Tenant and any other person who may
     be occupying the Leased Property or any part thereof, by force, if
     necessary, without being liable for prosecution or any claim for damages


                                      -43-

<PAGE>

     therefor. Tenant hereby waives any statutory requirement of prior written
     notice for filing eviction or damage suits for nonpayment of rent. In
     addition, Tenant agrees to pay to Landlord on demand the amount of all loss
     and damage which Landlord may suffer by reason of any termination effected
     pursuant to this subsection (c), said loss and damage to be determined, at
     Landlord's option, by either of the following alternative measures of
     damages:

               (i) Until Landlord is able, although Landlord shall be under no
          obligation to attempt, to relet the Leased Property, Tenant shall pay
          to Landlord, on or before the fifteenth (15th) day of each calendar
          month, until the scheduled expiration of the Term of the Lease which
          was in effect as of the date of Tenant's Event of Default, the amount
          by which the sum of the Operating Expenses of the Leased Property for
          the preceding calendar month plus the Base Rent provided in this Lease
          for such preceding calendar month exceed the Gross Rentals collected
          by Landlord from the operation of the Leased Property during such
          calendar month. If it is necessary for Landlord to bring suit in order
          to collect any such deficiency, Landlord shall have a right to allow
          such deficiencies to accumulate and to bring an action on several or
          all of the accrued deficiencies at one time. Any such suit shall not
          prejudice in any way the right of Landlord to bring a similar action
          for any subsequent deficiency or deficiencies. Tenant shall have no
          right to any Net Operating Income collected by Landlord in any
          calendar month in excess of the monthly Base Rent provided in this
          Lease for such calendar month; provided that any such excess Net
          Operating Income shall be credited against any other amounts owed by
          Tenant to Landlord hereunder, including any subsequently occurring
          deficiency in monthly Net Operating Income.

               (ii) When Landlord desires, Landlord may demand a final
          settlement. Upon demand for a final settlement, Landlord shall have a
          right to, and Tenant hereby agrees to pay, the difference between the
          total of all net monthly rentals and other charges provided in this
          Lease for the remainder of the Term of the Lease which was in effect
          as of the date of Tenant's Event of Default and the reasonable net
          rental value of the Leased Property for such period, such difference
          to be discounted to present value at a rate equal to the lowest rate
          of capitalization (highest present worth) reasonably applicable at the
          time of such determination and allowed by applicable law. If Landlord
          elects to compute damages in the manner prescribed by subsection
          (c)(i) above, this election shall in no way prejudice Landlord's right
          at any time thereafter to demand a final settlement in accordance with
          this subsection (c)(ii). Pursuit of any of the above remedies shall
          not preclude pursuit of any other remedies prescribed in other
          sections of this Lease and any other remedies provided by law or
          equity. Forbearance by Landlord to enforce one or more of the remedies
          herein provided upon an Event of Default shall not be deemed or
          construed to constitute a waiver of such default.

          (d) Landlord shall be entitled to draw upon the Letter of Credit in
     the amount of any unpaid Base Rent or Additional Rent owed to Landlord
     under this Lease. In addition, in the event this Lease is terminated
     following an Event of Default pursuant


                                      -44-

<PAGE>

     to paragraph (c) above, Landlord shall be entitled to draw upon the Letter
     of Credit in the amount of any deficiency pursuant to Section 12.2(c)(i)
     above.

          (e) In addition to other rights and remedies Landlord may have
     hereunder and at law and in equity, in the event Landlord terminates this
     Lease due to an Event of Default, (i) Landlord shall have the right, but
     not the obligation or responsibility, to hire all or some of the employees
     of Tenant, and Tenant hereby acknowledges that no non-compete or
     non-solicitation agreement is either implied or expressed hereunder
     relating to such employees; and (ii) Tenant shall be deemed to have
     assigned to Landlord, at Landlord's sole option, all tenant subleases and
     occupancy agreements and all service agreements, licenses and permits
     relating to the Leased Property.

     12.3 ADDITIONAL EXPENSES. If an Event of Default shall have occurred,
Tenant shall reimburse Landlord for (i) all reasonable expenses incurred by
Landlord in recovering possession of the Leased Property, (ii) all reasonable
expenses incurred by Landlord in reletting (including among other expenses,
repairs, remodeling, replacements, advertisements and brokerage fees), and (iii)
Landlord's reasonable attorneys' fees actually incurred and reasonable expenses
incurred in enforcing any of the covenants and agreements of this Lease.

     12.4 WAIVER. If this Lease is terminated pursuant to Section 12.2, Tenant
waives, to the extent permitted by applicable law, (a) any right of redemption,
re-entry or repossession, and (b) the benefit of any laws now or hereafter in
force exempting property from liability for rent or for debt.

     12.5 APPLICATION OF FUNDS. Any payments otherwise payable to Tenant which
are received by Landlord under any of the provisions of this Lease during the
existence or continuance of any Event of Default shall be applied to Tenant's
obligations in the order which Landlord may reasonably determine or as may be
prescribed by the laws of the states in which the Leased Property is located.

     12.6 NOTICES. The provisions of this Article 12 concerning Notices shall be
liberally construed insofar as the contents of such Notices are concerned, and
any such Notice shall be sufficient if reasonably designed to apprise the other
party of the nature and approximate extent of any default.

     12.7 REMEDIES CUMULATIVE. To the extent permitted by law, each legal,
equitable or contractual right, power and remedy of Landlord or Tenant now or
hereafter provided either in this Lease or by statute or otherwise shall be
cumulative and concurrent and shall be in addition to every other right, power
and remedy and the exercise or beginning of the exercise by Landlord or Tenant
of any one or more of such rights, powers and remedies shall not preclude the
simultaneous or subsequent exercise by Landlord or Tenant of any or all of such
other rights, powers and remedies.

     12.8 LANDLORD'S DEFAULT. In the event that Landlord shall at any time be in
default in the observance or performance of any of the covenants and agreements
required to be performed and observed by Landlord under this Lease and any such
default shall continue for a period of thirty (30) days after written Notice to
Landlord (or if such default cannot reasonably be cured


                                      -45-

<PAGE>

within thirty (30) days, then if Landlord has not commenced to cure such default
within said thirty (30) day period or, having commenced thereafter does not
diligently prosecute such cure to completion within ninety (90) days after
Landlord's receipt of Tenant's written Notice of default), then Tenant shall be
entitled, at its election, in addition to any other rights it may have in law or
in equity, to bring suit for the collection of any amounts for which Landlord
may be in default, together with interest thereon at the Overdue Rate, or for
the performance of any other covenant or agreement devolving upon Landlord. In
addition, Tenant shall be entitled to recover from Landlord Tenant's reasonable
attorneys' fees actually incurred and reasonable expenses incurred in enforcing
any of the covenants and agreements of Landlord under this Lease. In the event
Tenant obtains a judgment against Landlord arising out of Landlord's default
under the Lease, Tenant may, to the extent the judgment is not paid by Landlord,
elect to set off the amount of the judgment, plus interest at the Overdue Rate,
against the next due installments of Base Rent and Additional Rent. Election by
Tenant to set off against Rent shall not constitute an election of remedies and
Tenant may pursue all remedies available at law and equity to enforce the
judgment against Landlord.

                                   ARTICLE 13

                            SUBLETTING AND ASSIGNMENT

     13.1 Except as provided in this Article 13, Tenant shall not, without
Landlord's prior written consent, assign, mortgage, pledge, hypothecate,
encumber or otherwise transfer this Agreement or sublease all or any part of the
Leased Property or suffer or permit this Agreement or the leasehold estate
created hereby or any other rights arising under this Agreement to be assigned,
transferred, mortgaged, pledged, hypothecated or encumbered, in whole or in
part, whether voluntarily, involuntarily or by operation of law.

     13.2 Notwithstanding anything to the contrary provided in Section 13.1, the
approval rights of Landlord with respect to subleasing shall not be deemed to
apply to the leasing of individual beds, bedroom units or apartments in the
Leased Improvements for residential purposes, provided that:

          (a) each such sublease shall be subject and subordinate to this Lease
     and the rights of the Landlord hereunder;

          (b) each sublease shall contain terms and conditions not materially
     different from the form lease approved by Landlord for use in connection
     with the Leased Property;

          (c) the term of any such sublease shall not exceed twelve (12) months;
     and

          (d) each sublease shall provide for rental rates which in Tenant's
     reasonable business judgment are consistent with then-existing local market
     rates for similar type properties, and which in any event meet the
     requirements of Existing Lender with respect to the Projects which are
     subject to the Existing Loan.

     13.3 Landlord agrees that, provided there is no Event of Default
outstanding under this Lease, Landlord will not unreasonably withhold its
consent to an assignment or subletting of this


                                      -46-

<PAGE>

Lease by Tenant; provided, however, in exercising such right of consent,
Landlord shall be entitled to take into account any factor or factors reasonably
relevant to such decision, including but not necessarily limited to (i) the
financial strength of any proposed assignee or subtenant and its Affiliates (it
being acknowledged that Landlord may require that any assignee or subtenant be a
Single Purpose Entity), and the adequacy of the proposed assignee's,
subtenant's, and/or Affiliate's working capital, (ii) the business reputation
and character of the proposed assignee or subtenant and/or its Affiliates, and
(iii) whether such proposed assignee or subtenant is a Competitor of Landlord
(as hereinbelow defined) or an Affiliate of such a Competitor. Moreover, Tenant
acknowledges and agrees that Landlord is entering into this Lease in order to
achieve professional and experienced operation and management of the Leased
Property. Accordingly, Landlord shall never be deemed to be unreasonable in
withholding consent to any assignment or other transfer of Tenant's leasehold
estate to any assignee, purchaser, transferee, subtenant, or other party (x) not
having a high degree of professionalism and experience in the operation and
management of student housing properties, or (y) which has not submitted to
Landlord plans reasonably satisfactory to Landlord by which such party
demonstrates that such party or a third party to be engaged by such party can
manage the Leased Property with a degree of professionalism and experience not
less than that of Tenant. Tenant shall have no right to assign this Lease at any
time an Event of Default is outstanding. Further, notwithstanding anything to
the contrary provided in this Section 13.3, Landlord shall be entitled to
withhold its consent to any proposed assignment or subletting in Landlord's sole
and absolute discretion in the event that annualized Net Operating Income from
the Leased Property shall have been less than 1.05 times annual Base Rent during
the immediately preceding calendar quarter, or in the event that any Project
Mortgagee does not consent to such proposed assignment or subletting, to the
extent consent of such Project Mortgagee is required under the terms of a
Project Mortgage. For purposes of this Section 13.3 a "Competitor" shall mean
any Entity which owns a portfolio of more than five (5) student housing
properties.

     13.4 Should Tenant desire to assign this Lease or enter into any sublease
other than as described in Section 13.2 above, Tenant shall give Landlord
written notice of such proposed assignment or sublease (an "Assignment Notice"),
which notice shall contain (i) the name and address of the proposed assignee or
subtenant and its form of organization, (ii) the material terms and conditions
of the proposed assignment or sublease (including, without limitation, the
financial terms of such proposed assignment or sublease and the date of the
proposed assignment or sublease), (iii) financial statements for the three (3)
most recently completed fiscal years of the proposed assignee, subtenant, and/or
its Affiliates and such other financial information as Landlord shall reasonably
request, and (iv) such other information as Landlord shall reasonably request in
order to evaluate the factors described in Section 13.3 above. Landlord shall
have a period of ten (10) Business Days following receipt of such Assignment
Notice within which to notify Tenant in writing that Landlord elects either (a)
to permit Tenant to assign this Lease or sublease the Leased Property, (b) to
withhold consent to such assignment or subleasing, or (c) in the event the
proposed assignment or sublease is limited solely to Tenant's assignment or
sublease of this Lease and does not relate to or affect any Affiliate of Tenant,
to acquire Tenant's interest in this Lease or sublease the Leased Property on
the terms and conditions set forth in the Assignment Notice. The failure of
Landlord to notify Tenant in writing of such election within such ten (10)
Business Day period shall be deemed an election to withhold consent to such
proposed assignment or subleasing.


                                      -47-

<PAGE>

     13.5 If Landlord exercises its option to acquire Tenant's interest in this
Lease pursuant to Section 13.4 above, the closing of Landlord's acquisition of
Tenant's interest shall be held on the date set for in the Tenant's Assignment
Notice, provided that such date shall not be sooner than sixty (60) days after
the date of Landlord's election to acquire Tenant's interest, unless otherwise
agreed by Landlord and Tenant. If Landlord shall not exercise such option and
shall consent to Tenant's proposed assignment or subletting, Tenant shall be
entitled to assign or sublet its interest in this Lease to the party identified
in Tenant's Notice strictly in accordance with the terms set forth in Tenant's
Notice.

     13.6 In the event that Landlord declines to consent to an assignment or
subletting proposed by Tenant and does not exercise its option to acquire
Tenant's interest in this Lease pursuant to Section 13.4 above, and provided
that (i) there is no Event of Default outstanding under this Lease, (ii) the
Fixed Term has expired and the Lease is in an Extension Term, and (iii)
annualized Net Operating Income from the Leased Property, calculated on a
trailing twelve (12) month basis (excluding any Net Operating Income
attributable to any Property which has been released from this Lease) shall have
been not less than an amount equal to 1.05 times annual Base Rent (excluding
Base Rent attributable to any Property which has been released from this Lease)
for eight (8) consecutive calendar quarters immediately preceding the date of
Tenant's Assignment Notice, then and in such event Tenant shall have the right,
at its option, within thirty (30) days after Landlord's refusal to approve such
assignment or subletting, to notify Landlord in writing that Tenant elects to
terminate this Lease. If Tenant elects to terminate this Lease, this Lease shall
terminate on the last day of the second full month following Tenant's delivery
of such notice of termination to Landlord.

     13.7 For purposes of this Article 13, an assignment shall be deemed to
include a change in control of Tenant resulting from any sale, transfer, or
assignment of limited liability company membership interests or management
rights, partnership interests, shares of stock, or other ownership interests in
Tenant, whether occurring by operation of law or otherwise, except in the case
of the death or legal incompetency of a Person owning, directly or indirectly, a
controlling interest in Tenant. For purposes hereof, "control" means the ability
to direct or cause the direction of the operations and affairs of Tenant.
Notwithstanding the foregoing or anything to the contrary provided in this
Article 13, the consent of the Landlord need not be obtained to an assignment if
the assignment (i) is to an Affiliate of Tenant, provided that any such
Affiliate is a Single Purpose Entity and is solvent as of and immediately
following any such assignment, or (ii) is the result of a change in control
caused by the death or legal incompetency of a Person owning, directly or
indirectly, a controlling interest in Tenant. Tenant shall give Landlord written
notice of any assignment to an Affiliate as described above, including the
effective date of such assignment.

     13.8 If this Lease is assigned, whether or not in violation of the
provisions of this Lease, the Landlord may and is hereby empowered to collect
rent from the assignee. In such event, the Landlord may apply the net amount
received by it to the Base Rent, Additional Rent and other payments herein
reserved or provided for, and no such collection shall be deemed a waiver of the
covenant herein against assignment, mortgage, encumbrance, pledge or subletting,
or an acceptance of the assignee as a tenant under this Lease, or a release of
the Tenant from the further performance of the covenants herein contained on the
part of the Tenant.


                                      -48-

<PAGE>

     13.9 The making of any assignment, mortgage, pledge, encumbrance or
subletting, in whole or in part, whether or not with the consent of the
Landlord, shall not operate to relieve the Tenant from its obligations under
this Lease and, notwithstanding any such assignment, mortgage, pledge,
encumbrance or subletting, the Tenant shall remain liable for the payment of all
Rent and for the due performance of all the covenants, agreements, terms and
provisions of this Lease to the full end of the term of this Lease.

     13.10 Each and every assignee, whether or not approved by the Landlord and
whether as assignee or as successor in interest of any assignee of the Tenant,
shall immediately be and become and remain liable for the payment of the Rent
and other charges payable under this Lease, and for the due performance of all
the covenants, agreements, terms and provisions of this Lease on the Tenant's
part to be performed to the full end of the Term of this Lease and each and
every provision of this Lease applicable to the Tenant shall also apply to and
bind every such assignee during all periods that such assignee is the tenant
hereunder with the same force and effect as though such assignee were the Tenant
named in this Lease. No transfer to such assignee shall be binding upon the
Landlord unless such assignee shall deliver to the Landlord a recordable
instrument which contains a covenant of assumption by said assignee to such
effect, but the failure or refusal of such assignee to deliver such instrument
shall not release or discharge such assignee from its obligations and liability
as above set forth. In the event that any such assignee is a Single Purpose
Entity or otherwise does not have substantial assets other than the Leased
Property, Landlord shall have the right to require, as a condition to its
approval of such assignment, that an Affiliate of such assignee with financial
strength reasonably acceptable to Landlord provide an Agreement of Principals in
a form similar to Exhibit F hereto, as modified to reflect the contemplated
transaction, with respect to potential liabilities, losses, and damages incurred
by Landlord as a result of certain actions by the assignee with respect to the
Leased Property. Provided Landlord shall have received such an Agreement of
Principals from an Affiliate of the assignee reasonably acceptable to Landlord,
Landlord shall release the parties to the original Agreement of Principals from
any liability accruing from and after the completion of such assignment, but not
from any liabilities for acts and occurrences taking place prior to such
assignment.

     13.11 Any consent by the Landlord herein contained or hereafter given to
any act of assignment, mortgage, pledge or encumbrance shall be held to apply
only to the specific transaction hereby or thereby approved. Such consent shall
not be construed as a waiver of the duty of the Tenant, or its successors or
assigns, to obtain from the Landlord a consent to any other or subsequent
assignment, mortgage or encumbrance or as a modification or limitation of the
right of the Landlord with respect to the foregoing covenant by the Tenant.

     13.12 Any assignment or subleasing of Tenant's interest under this Lease
not made in compliance with the provisions of this Article 13 shall be void and
of no force or effect and shall be an Event of Default.


                                      -49-

<PAGE>

                                   ARTICLE 14

                   FINANCIAL STATEMENTS AND OTHER CERTIFICATES

     14.1 ESTOPPEL CERTIFICATES. From time to time, each party hereto, on or
before the date specified in a request therefor made by the other party, which
date shall not be earlier than ten (10) days from the making of such request,
but not more than two (2) times per calendar year, shall execute, acknowledge
and deliver to the other party a certificate evidencing whether or not (i) this
Lease is in full force and effect; (ii) this Lease has been amended in any way;
(iii) there are any existing defaults on the part of either party hereunder, to
the knowledge of such other party, and specifying the nature of such defaults,
if any; (iv) stating the date to which rent and other amounts due hereunder have
been paid; and (v) such other matters as may reasonably be requested by such
party. Each certificate delivered pursuant to this Section 14.1 may be relied on
by any prospective transferee of Landlord's or Tenant's interest hereunder and
any lender of Landlord.

     14.2 FINANCIAL STATEMENTS AND OFFICER'S CERTIFICATES.

          (a) During the Term, Tenant will furnish the following statements to
     Landlord on such forms and in such detail as Landlord, from time to time,
     may reasonably request or approve:

               (i) within sixty (60) days after the end of each Fiscal Year,
          audited annual financial statements for the Leased Property, on an
          aggregate basis, including a statement of revenues and expenses, a
          statement of changes in financial position for such Fiscal Year, and a
          related balance sheet as of the end of such Fiscal Year, all in
          reasonable detail and setting forth in comparative form the
          corresponding figures for the preceding Fiscal Year, and prepared in
          accordance with GAAP, as well as corresponding unaudited financial
          statements on a Property-by-Property basis. The aggregated financial
          statements shall be certified by a nationally recognized accounting
          firm or an independent certified public accounting firm acceptable to
          Landlord and accompanied by a Financial Officer's Certificate. All
          costs of providing for audits of such financial statements shall be
          paid by Landlord. Landlord acknowledges that Windham & Brannen, which
          is Tenant's current auditor, is an acceptable accounting firm for
          purposes hereunder so long as such firm maintains the same financial
          condition and rating which exists as of the date hereof;

               (ii) within forty-five (45) days after the end of each calendar
          quarter, unaudited financial statements of the Leased Property for the
          quarter then ended and year to date, prepared on a basis consistent
          with the annual statements, including a balance sheet as of the end of
          such calendar quarter and a statement of revenues and expenses, and
          including a calculation of the Net Operating Income of the Leased
          Property, on both a combined and a Property-by-Property basis, for the
          calendar quarter covered by such financial statements, all accompanied
          by a Financial Officer's Certificate;


                                      -50-

<PAGE>

               (iii) within twenty (20) days after the end of each calendar
          month, current unaudited month and year to date operating statements
          of the Leased Property, prepared on a Property-by-Property basis,
          including, but not limited to statements of cash flow and operating
          statistics, accompanied by a Financial Officer's Certificate;

               (iv) Within twenty (20) days after the end of each calendar
          month, current rent rolls and occupancy reports, including a schedule
          of prepaid rents and security deposits, prepared on a
          Property-by-Property basis;

               (v) Not less than forty-five (45) days prior to the commencement
          of each Fiscal Year during the Term, commencing on November 15, 2005,
          proposed annual operating budgets, setting forth projected income and
          ordinary expenses projected to be incurred by Tenant in managing,
          maintaining and operating the Leased Property, on both a combined and
          a Project-by-Project basis, during the next succeeding Fiscal Year
          (Landlord acknowledging prior receipt of the annual operating budget
          for calendar year 2005); and

               (vi) with reasonable promptness, such other information
          respecting the financial condition and affairs of the Leased Property
          as Landlord may reasonably request from time to time.

     Landlord may at any time, and from time to time, provide any Project
     Mortgagee with copies of the foregoing statements.

          (b) If any required annual, quarterly, or monthly financial statement
     or report is not received by Landlord by the due date thereof, Landlord
     may, at its option, impose upon Tenant a late fee of One Thousand and
     No/100 Dollars ($1,000.00) for each Property for which such statement or
     report is delinquent, such late fee to be due and payable at the time of
     payment of the next succeeding monthly installment of Base Rent following
     notification of assessment by Landlord. In addition, Tenant shall promptly
     reimburse Landlord for any late fees or penalties imposed upon Landlord by
     the Existing Lender as a result of Tenant's failure to provide any such
     financial statement to Landlord and/or the Existing Lender within the time
     periods provided for herein. The parties recognize that in connection with
     any delinquent submission of required annual, quarterly, or monthly
     financial statements or reports Landlord will incur administrative costs
     and that the amount of such administrative costs will be difficult to
     compute in any specific case, and consequently the parties have agreed on
     the above stated late fee as a fair and reasonable charge to compensate
     Landlord for such administrative costs.

          (c) Tenant shall also deliver to Landlord with each annual and
     quarterly financial statement delivered to Landlord pursuant to this
     Section 14.2 (a) above, an Officer's Certificate in the form attached
     hereto as Exhibit E stating (i) whether the representations and warranties
     of Tenant contained in this Agreement are true and correct on the date of
     such certificate and if not, stating in what way they are incorrect
     (excluding changes permitted by this Agreement), and (ii) whether or not
     Tenant is in


                                      -51-

<PAGE>

     default in the performance of any of its covenants set forth in this
     Agreement, and if Tenant is so in default, identifying each such default.

     14.3 MAINTENANCE OF ACCOUNTS AND RECORDS. Tenant shall keep true records
and books of account in which full, true and correct entries will be made of
dealings and transactions in relation to the business and affairs of the Leased
Property in accordance with GAAP, where applicable. Tenant shall apply
accounting principles in the preparation of the financial statements of Tenant
which, in the judgment of and the opinion of its independent public accountants,
are in accordance with GAAP, where applicable, except for changes approved by
such independent public accountants. Tenant shall provide to Landlord either in
a footnote to the financial statements delivered under Section 14.2 (a)(i) and
Section 14.2(a)(ii) which relate to the period in which such change occurs, or
in separate schedules to such financial statements, information sufficient to
show the effect of any such changes on such financial statements.

     14.4 RIGHT OF INSPECTION. Landlord and its authorized representatives, as
well as any Project Mortgagee or its authorized representatives designated by
Landlord, shall have the right, from time to time at Landlord's sole cost and
expense, upon reasonable Notice, during Tenant's customary business hours, to
examine and make copies of Tenant's books and records with respect to the Leased
Property at the place where such books and records are customarily kept and to
discuss the affairs, finances, and accounts of Tenant with the principal
representatives of Tenant and its accountants, and to visit and inspect the
Projects and to discuss the operations thereof with Tenant's employees or
Manager.

     14.5 LANDLORD SECURITIES OFFERING AND FILINGS. Notwithstanding anything
contained herein to the contrary, Tenant agrees to cooperate with Landlord and
its Affiliates in connection with any securities offerings and filings and in
connection therewith, Tenant shall at Landlord's sole cost furnish Landlord with
such financial and other information as Landlord shall reasonably request and
Landlord and its Affiliates shall have the right of access, at reasonable
business hours and upon advance notice, to the Leased Property and all
documentation and information relating to the Leased Property and have the right
to disclose any information regarding this Lease, the Tenant, the Leased
Property, and such other additional information or documents concerning this
Lease, the Tenant or the Leased Property which Landlord and/or its Affiliates
may reasonably deem necessary.

                                   ARTICLE 15

                        FINANCING OF THE LEASED PROPERTY

     15.1 FINANCING BY LANDLORD. Without the consent of Tenant, Landlord may,
from time to time, directly or indirectly, create or otherwise cause to exist
any lien, encumbrance or security interest ("Encumbrance") upon the Leased
Property, or so much thereof as remains subject to this Lease from time to time,
to secure any financing or refinancing of Landlord's interest in said Leased
Property, or such portion thereof.

     15.2 SUBORDINATION OF LEASE. Subject to this Section 15.2, this Agreement,
any and all rights of Tenant hereunder, are and shall be subject and subordinate
to all mortgages, deeds to secure debt, and deeds of trust which may now or
hereafter affect the Leased Property or any


                                      -52-

<PAGE>

improvements thereon, to each and every advance made or hereafter to be made
under such mortgages, deeds to secure debt, and deeds of trust, and to all
renewals, modifications, replacements and extensions of such mortgages, deeds to
secure debt, and deeds of trust and all consolidations of such mortgages, deeds
to secure debt, and deeds of trust. This section shall be self-operative and no
further instrument of subordination shall be required provided that Tenant has
received a nondisturbance and attornment agreement from each Project Mortgagee
consistent with the provisions of this Section 15.2 and otherwise in form and
substance reasonably satisfactory to Tenant. In confirmation of such
subordination, Tenant shall promptly execute, acknowledge and deliver any
instrument that Landlord, the holder of any such mortgage or deed to secure
debt, the trustee or beneficiary of any deed of trust, or any of their
respective successors in interest may reasonably request to evidence such
subordination. Any mortgage, deed to secure debt, or deed of trust to which this
Agreement is, at the time referred to, subject and subordinate, is herein called
"Superior Mortgage" and the holder, trustee or beneficiary of a Superior
Mortgage is herein called a "Superior Mortgagee."

     If any Superior Mortgagee or the nominee or designee of any Superior
Mortgagee shall succeed to the rights of Landlord under this Agreement (any such
person, "Successor Landlord"), whether through possession or foreclosure action
or delivery of a new lease or deed, or otherwise, such Successor Landlord shall
recognize Tenant's rights under this Agreement as herein provided and Tenant
shall attorn to and recognize the Successor Landlord as Tenant's landlord under
this Agreement and Tenant shall promptly execute and deliver any instrument that
such Successor Landlord may reasonably request to evidence such attornment
(provided that such instrument does not alter the terms of this Agreement),
whereupon this Agreement shall continue in full force and effect as a direct
lease between the Successor Landlord and Tenant upon all of the terms,
conditions and covenants as are set forth in this Agreement, except that the
Successor Landlord (unless formerly Landlord under this Agreement or its nominee
or designee) shall not be (a) liable in any way to Tenant for any act or
omission, neglect or default on the part of any prior Landlord under this
Agreement (provided that such Successor Landlord shall be obligated to cure any
defaults of the prior Landlord which are of a continuing nature), (b) subject to
any offsets or counterclaims which theretofore accrued to Tenant against any
prior Landlord, except for any offsets which relate to a failure by any prior
Landlord to fund any Capital Expenditures required to be funded pursuant to the
terms of this Lease and which remain unfunded by such Successor Landlord, (c)
bound by any modification of this Agreement subsequent to such Superior
Mortgage, or by any previous prepayment of Base Rent or Additional Rent for more
than one (1) month in advance of the date due hereunder, which was not approved
in writing by the Superior Mortgagee, or (d) liable to Tenant beyond the
Successor Landlord's interest in the Leased Property and the rents, income,
receipts, revenues, issues and profits issuing from the Leased Property. Tenant
agrees at any time and from time to time to execute a suitable instrument in
confirmation of Tenant's agreement to attorn as aforesaid, and Landlord agrees
to provide Tenant with an instrument of nondisturbance and attornment from each
such Superior Mortgagee in form and substance reasonably satisfactory to Tenant.
Nothing contained in this Section 15.2 shall relieve Landlord from any liability
to Tenant under this Agreement following the exercise of remedies by a Superior
Mortgagee.

     15.3 NOTICE TO MORTGAGEE. Subsequent to the receipt by Tenant of Notice
from Landlord as to the identity of any Project Mortgagee, no Notice from Tenant
to Landlord as to the Leased Property shall be effective unless and until a copy
of the same is given to such Project


                                      -53-

<PAGE>

Mortgagee at the address set forth in the above described Notice, and the curing
of any of Landlord's defaults by such Project Mortgagee shall be treated as
performance by Landlord.

     15.4 EXISTING MORTGAGE LOAN. It is expressly understood and agreed between
Landlord and Tenant that this Lease is and shall be subject and subordinate to
the terms of that certain loan in the original principal amount of
$98,660,000.00 (the "Existing Mortgage Loan") originally made by Greenwich
Capital Financial Products, Inc. (hereinafter, together with any successor in
interest under the Existing Mortgage Loan being hereinafter referred to as the
"Existing Lender") to certain Affiliates of Tenant, as prior owners of certain
of the Leased Properties (the "Greenwich Properties"), as the terms of such
Existing Mortgage Loan are set forth in that certain Loan Agreement between said
Affiliates of Tenant and Existing Lender dated December 3, 2004 (the "Existing
Loan Agreement") and in the other documents and instruments which evidence,
secure, and relate to such Loan, as amended by that certain Consent,
Ratification, Assumption and Release Agreement dated of even date herewith (the
"Existing Loan Documents"). Tenant and Landlord each hereby acknowledge receipt
of copies of the Existing Loan Agreement and the other Existing Loan Documents,
and represent that they are familiar with the terms, covenants, and conditions
thereof. Tenant further hereby covenants and agrees as follows:

          (a) No right, power, or privilege granted to Tenant under this Lease
     may be exercised or enjoyed by Tenant if and to the extent that such
     exercise, enjoyment, or operation would violate or be in conflict with any
     term, covenant, or condition of the Existing Loan Documents applicable to
     Landlord. Tenant covenants and agrees that it will not, to the extent
     within the control of Tenant, violate or breach or take any action which
     would cause a violation or breach of any of the terms, covenants, or
     conditions of the Existing Mortgage Loan.

          (b) During the term of this Lease, Tenant shall, to the extent within
     the control of Tenant, comply and cause the Greenwich Properties to comply
     with the terms and requirements of Sections 5.5(A), 5.11, 5.12, and 5.13 of
     the Existing Loan Agreement and, to the extent not provided in the
     financial reports described in Section 14.2 hereof, shall provide to
     Landlord the financial statements and other information required by Section
     5.1(A)(iv), (v), (vi), and (vii) of the Existing Loan Agreement with
     respect to the operation of the Greenwich Properties.

          (c) Tenant shall notify Landlord and Existing Lender promptly upon the
     occurrence of any events of the type described in Section 5.1(D)(ii) or (F)
     of the Existing Loan Agreement.

          (d) Tenant shall maintain or cause to be maintained insurance in
     accordance with the requirements of Section 5.4 of the Existing Loan
     Agreement.

          (e) Tenant shall permit Existing Lender or any representative, agent,
     or designee of Existing Lender, during normal business hours and upon
     reasonable prior Notice to Tenant, to examine and make copies of the
     financial records of Tenant with respect to the Greenwich Properties, and
     to discuss the affairs, finances, and accounts of such Properties with the
     principal representatives of Tenant and its accountants and


                                      -54-

<PAGE>

     auditors and to visit and inspect such Properties and to discuss the
     operations thereof with Tenant's employees, all at such reasonable times
     and as often as Existing Lender may reasonably request.

          (f) Tenant shall provide to Landlord and Existing Lender a proposed
     annual operating budget and operate the Greenwich Properties in accordance
     with the terms thereof upon approval thereof by the Existing Lender, all as
     more particularly described in Section 7.3(F) of the Existing Loan
     Agreement, without material deviation therefrom except with the approval of
     Landlord and Existing Lender.

          (g) Tenant shall deposit (or cause to be deposited) all revenues,
     receipts, and other payments of every kind arising from the operation of
     the Greenwich Properties into collection accounts established for the
     benefit of and controlled by the Existing Lender, as described in Section
     5.15 of the Existing Loan Agreement. To the extent that the Existing Lender
     applies such revenues and receipts to the funding of (i) the Debt Service
     Sub-Account, or (ii) the Replacement Reserve Sub-Account, as described in
     Section 7.3(A) of the Existing Loan Agreement, the amounts so applied by
     Existing Lender shall be credited against subsequent monthly payments of
     Base Rent and Additional Rent due under this Lease. So long as no Event of
     Default exists under this Lease, Landlord shall direct Existing Lender to
     disburse all funds from the Operating Expenses Sub-Account and all Net
     Available Cash remaining after funding of the sub-accounts described in
     Section 7.3(A) of the Existing Loan Agreement directly to Tenant. In
     addition, provided no Event of Default exists under this Lease, Landlord
     shall direct Existing Lender to disburse any funds released by Existing
     Lender from the Imposition and Insurance Reserve Sub-Account provided for
     in the Existing Loan Agreement directly to Tenant. Further, so long as no
     Event of Default has occurred and is continuing, Tenant is authorized on
     behalf of Landlord (and Landlord shall so advise Existing Lender and its
     agents including any depository banks holding funds under the Existing
     Mortgage Loan) to deal directly with Existing Lender (and such depository
     banks) on any matters relating to Sections 7.1 and 7.2 of the Existing
     Loan.

          (h) Tenant acknowledges and agrees that, in the event Landlord's
     interest in the Greenwich Properties is terminated as a result of a
     foreclosure under the Existing Loan Documents, a conveyance in lieu of
     foreclosure, or the Existing Lender's exercise of any other remedies under
     the Existing Loan Documents, or in the event the Existing Lender or a
     nominee or designee of the Existing Lender shall succeed to the rights of
     Landlord under this Lease, whether through possession or through a
     foreclosure action or conveyance in lieu of foreclosure, then unless the
     Existing Lender shall elect to continue this Lease as provided in
     subparagraph (i) below, this Lease shall terminate and be cancelled with
     respect to the Greenwich Properties. Notwithstanding anything to the
     contrary provided in Section 2.4(b) above, in the case of such a
     termination, Landlord shall have no liability for any Termination Fee in
     the event that any Event of Default exists under this Lease as of the date
     this Lease is terminated with respect to such Greenwich Properties pursuant
     to the terms of this Section 15.4(h).

          (i) Notwithstanding the terms of subparagraph (h) above, in the event
     that the Existing Lender or its nominee or designee elects to continue this
     Lease following a


                                      -55-

<PAGE>

     foreclosure under the Existing Loan Documents, a conveyance in lieu of
     foreclosure, or the Existing Lender's exercise of any other remedies under
     the Existing Loan Documents, Tenant agrees to attorn to and recognize such
     Successor Landlord as Tenant's Landlord under this Lease, provided that in
     such event:

               (1) this Lease shall automatically terminate and be cancelled
          with respect to the Properties other than the Greenwich Properties
          without requirement of further action on the part of Landlord and
          Tenant, as if such Properties had been sold to an Entity which is not
          an Affiliate of Landlord, but without requirement for payment of any
          Termination Fee in connection with such termination;

               (2) this Lease shall continue in full force and effect as a
          direct lease between the Successor Landlord and Tenant with respect to
          the Greenwich Properties upon all of the terms, conditions, and
          covenants as are set forth in this Lease, except that Tenant shall not
          be entitled to a reduction in the Letter of Credit with respect to the
          release of the non-Greenwich Properties from the terms of this Lease;
          and

               (3) Provided that (i) no Event of Default exists under this Lease
          as of the date of such foreclosure or conveyance in lieu of
          foreclosure, and (ii) Net Operating Income from the non-Greenwich
          Properties equals at least 1.05 times the annual Base Rent
          attributable thereto, based upon the Net Operating Income of such
          Properties for the most recent calendar quarter for which financial
          statements have been provided pursuant to Section 14.2 hereof,
          Landlord and Tenant shall enter into a new lease of the non-Greenwich
          Properties for the remainder of the term of this Lease, effective as
          of the date of such foreclosure or conveyance in lieu of foreclosure,
          at the allocable Rent and upon the other terms, options, provisions,
          covenants, and agreements as are contained herein, except that Tenant
          shall not be required to provide a Letter of Credit under the terms of
          such new lease.

                                   ARTICLE 16

                         ADDITIONAL AGREEMENTS OF TENANT

     16.1 REPRESENTATIONS AND WARRANTIES. Tenant hereby represents and warrants
to the Landlord as follows:

          (a) Tenant is a limited liability company duly organized and validly
     existing under the laws of the State of Georgia.

          (b) Tenant is duly authorized to enter into, deliver and perform this
     Lease and the Lease constitutes the valid and binding obligation of Tenant,
     enforceable in accordance with its terms, subject to (i) applicable
     bankruptcy, insolvency, reorganization, moratorium and other laws affecting
     the rights of creditors generally,


                                      -56-

<PAGE>

     (ii) the exercise of judicial discretion in accordance with general
     principles of equity, and (iii) the unenforceability of certain rights,
     remedies and waivers contained herein.

          (c) Subject to Landlord's repayment or defeasance of all mortgage
     loans encumbering the Leased Property as of the date of execution of this
     Lease other than the Existing Mortgage Loan, neither the entering into of
     this Lease nor the performance by Tenant of its obligations hereunder will
     violate any provision of law or any agreement, indenture, note or other
     instrument binding upon Tenant.

          (d) No authority from or approval by any Governmental Authority or
     consent of any third party other than Existing Lender is required in
     connection with the making or validity of and the execution, delivery and
     performance of this Lease.

          (e) There are no actions, suits or proceedings pending against or, to
     the knowledge of Tenant, its members, directors, officers, employees and
     agents, threatened against or affecting Tenant or any Affiliate, in any
     court or before or by any governmental department, agency or
     instrumentality, an adverse decision in which could materially and
     adversely affect the financial condition, business or operations of Tenant
     or the ability of Tenant to perform its obligations under this Lease or the
     other documents referred to herein.

          (f) Tenant is in compliance with all applicable laws, ordinances,
     rules, regulations and requirements of Governmental Authorities.

     16.2 SINGLE PURPOSE ENTITY. Tenant hereby represents and warrants that it
is, at the time of the execution of this Lease, and shall remain at all times
during the Term, a Single Purpose Entity created and to remain in good standing
for the sole purpose of leasing the Leased Property and operating the Projects
in accordance with the terms of this Lease. Simultaneously with the execution of
this Lease, and as requested by Landlord at other times during the Term, Tenant
shall provide Landlord reasonable evidence that Tenant is a Single Purpose
Entity and is in good standing in the state of its organization and in the
states in which the Projects are located.

     16.3 ORGANIZATIONAL DOCUMENTS. Tenant shall not permit or suffer, without
the prior written consent of Landlord (i) an amendment or modification of its
Organizational Documents which would violate Section 16.2, (ii) any dissolution
or termination of its existence, or (iii) change in its state of formation or
its name. Tenant, prior to or simultaneously with the execution of this Lease,
has delivered to Landlord a true and complete copy of the articles of
organization/certificate of formation and limited liability company operating
agreement creating Tenant, and all other documents creating and governing Tenant
(collectively, the "Organizational Documents"). Tenant warrants and represents
that the Organizational Documents (i) were duly executed and delivered, (ii) are
in full force and effect, and binding upon and enforceable in accordance with
their terms, (iii) constitute the entire understanding among the members of
Tenant, and (iv) no breach exists under the Organizational Documents and no act
has occurred and no condition exists which, with the giving of notice or the
passage of time, or both, would constitute a breach under the Organizational
Documents.


                                      -57-

<PAGE>

     16.4 NOTICE OF LITIGATION, ETC. Tenant shall give prompt Notice to Landlord
of any litigation or any administrative proceeding to which it may hereafter
become a party of which Tenant has notice or actual knowledge (excluding routine
tenant/landlord disputes or dispossessory proceedings or matters involving a
potential uninsured liability of not more than $50,000) and of any material
development in any such litigation or administrative proceeding which, in
Tenant's reasonable opinion, may otherwise result in any material adverse change
in the business, operations, property, prospects, results of operation or
condition, financial or other, of Tenant.

     16.5 INDEBTEDNESS OF TENANT. Tenant shall not create, incur, assume or
guarantee, or permit to exist, or become or remain liable directly or indirectly
upon, any Indebtedness except the following:

          (a) Indebtedness of Tenant to Landlord;

          (b) Indebtedness of Tenant for Impositions, to the extent that payment
     thereof shall not at the time be required to be made in accordance with the
     provisions of Section 3.5;

          (c) Indebtedness of Tenant in respect of judgments or awards (i) which
     have been in force for less than the applicable appeal period and in
     respect of which execution thereof shall have been stayed pending such
     appeal or review, or (ii) which are fully covered by insurance payable to
     Tenant, or (iii) which are for an amount not in excess of $100,000 in the
     aggregate at any one time outstanding and (x) which have been in force for
     not longer than the applicable appeal period, so long as execution is not
     levied thereunder or (y) in respect of which an appeal or proceedings for
     review shall at the time be prosecuted in good faith in accordance with the
     provisions of Article 8, and in respect of which execution thereof shall
     have been stayed pending such appeal or review; and

          (d) Operating liabilities incurred in the ordinary course of Tenant's
     business.

     16.6 FINANCIAL CONDITION OF TENANT. Tenant hereby represents and warrants
that as of the date of this Lease, Tenant has a Tangible Net Worth of not less
than $1,000,000.00.

     16.7 DISTRIBUTIONS. Tenant shall not declare, order, pay or make, directly
or indirectly, any distribution or payment to any Tenant Related Party if, at
the time of such proposed distribution or payment, or immediately after giving
effect thereto, (i) an Event of Default shall exist, or (ii) the Tangible Net
Worth of Tenant shall be less than $1,000,000.00.

     16.8 PROHIBITED TRANSACTIONS. Tenant shall not permit to exist or enter
into any agreement or arrangement whereby it engages in a transaction of any
kind with any Tenant Related Party, except on terms and conditions which are
commercially reasonable.

     16.9 COMPETITIVE DEVELOPMENTS. During the term of this Lease, neither
Tenant nor any Affiliate of Tenant shall develop or build any other student
oriented apartment complexes or other student housing in the specific market
areas in which the Projects are located without the prior written consent of
Landlord, which consent may be granted or withheld in the sole and


                                      -58-

<PAGE>

absolute discretion of Landlord; provided that the foregoing restriction shall
not be applicable to the development or construction of student housing located
on the campus of any college or university, or off campus on land owned or
controlled by a college or university or a college or university sponsored
affiliate, the development or construction of which is the subject of a formal
and competitive "request for approval" process, pursuant to which an Affiliate
of Tenant shall have been awarded the applicable rights of development.

     16.10 SUBLEASING.

          (a) Tenant shall enforce, in the ordinary course of Tenant's operation
     of the Leased Property, all of the material terms, covenants and conditions
     contained in the subleases of the beds or bedroom units located within the
     Projects upon the part of the subtenants thereunder to be observed or
     performed and shall effect a termination or diminution of the obligations
     of the subtenants under such subleases, only in a manner that a prudent
     owner of a similar property to the applicable Project would enforce such
     terms covenants and conditions or effect such termination or diminution in
     the ordinary course of business.

          (b) Tenant shall not collect any rents from any subtenant more than
     twelve (12) months in advance, and the total amount of prepaid rents under
     the subleases at any Property shall not in any event exceed 10% of the
     annual rents for such Property.

          (c) Tenant shall make available to Landlord at the respective Projects
     executed copies of all subleases now or hereafter made by Tenant.

     16.11 MANAGEMENT AGREEMENT.

          (a) Tenant shall not enter into any Management Agreement unless (i)
     the Manager thereunder has been approved in writing by Landlord, (ii) such
     agreement specifies that the Manager's right to collect or enforce payment
     of amounts due under such agreement on any date shall be subordinate to the
     obligations of Tenant regarding the payment of Rent under this Lease and is
     otherwise approved by Landlord, and (iii) such agreement shall provide
     Landlord the right to terminate same upon termination of the Lease without
     liability for any amounts owing under such agreement as of such date of
     termination, for any termination fee, or otherwise. Landlord hereby
     approves Tenant's entering into a Management Agreement with Place
     Management Group, LLC.

          (b) Tenant shall cause any Manager to manage the Leased Property or
     applicable portion thereof in accordance with the applicable Management
     Agreement. Tenant shall (i) diligently perform and observe all of the
     material terms, covenants and conditions of any Management Agreement on the
     part of Tenant to be performed and observed and (ii) promptly notify
     Landlord of any notice to Tenant of any material default under the
     Management Agreement of which it is aware.

          (c) Tenant shall not terminate, materially modify, or enter into any
     Management Agreement (except that Tenant may continue to renew the existing
     Management Agreement with Place Management Group, LLC unless the Manager
     thereunder is replaced pursuant to subparagraph (d) below) without the
     express consent


                                      -59-

<PAGE>

     of Landlord, which consent may be conditioned upon the approval of the
     Existing Lender or any applicable Project Mortgagee.

          (d) Landlord shall have the right to require Tenant to replace the
     Manager for any Project with a Person approved by Landlord and the
     applicable Project Mortgagee, following any one or more of the following
     events: (i) thirty (30) days after Notice from Landlord to Tenant that such
     Manager has engaged in fraud, gross negligence or willful misconduct
     arising from or in connection with its performance under the applicable
     Management Agreement, or such Manager's default under the Management
     Agreement which is not cured within any applicable cure period provided
     under the Management Agreement; (ii) a change in control of such Manager,
     other than a change of control resulting from the death or legal disability
     of the controlling owner(s) of Manager; or (iii) so long as the Existing
     Mortgage Loan remains in place, if the Existing Lender shall require
     replacement of the Manager pursuant to the terms of Section 5.13(C) of the
     Existing Loan Agreement. Notwithstanding the foregoing, Landlord shall not
     unreasonably withhold its approval of a change of control in Manager as
     long as (A) the then current executive management team of Manager continues
     to furnish professional and experienced operation and management of the
     Projects, (B) Net Operating Income from the Leased Property continues to
     equal not less than 1.05 times Base Rent, and (C) as a result of such
     change of control Manager does not become an Affiliate of a Competitor of
     Landlord.

     16.12 MATERIAL AGREEMENTS. Except for subleases complying with the terms of
this Lease and any Management Agreement complying with the foregoing, without
the prior written approval of Landlord, Tenant shall not enter into, renew,
allow to be automatically renewed, or become obligated under any service,
vendor, or other agreement pertaining to any of the Leased Property (excluding
agreements having a contract value of less than $50,000 with parties not
affiliated with Tenant or Manager for the provision of ordinary and necessary
day-to-day services necessary to operate the Leased Property), including without
limitation brokerage agreements, unless the same may be terminated without cause
and without payment of a penalty or premium, on not more than thirty (30) days'
prior written notice. Notwithstanding the foregoing, Landlord hereby expressly
acknowledges and consents to those certain web services agreements between
Tenant and WebRoomz, a Tenant Related Party.

     16.13 USE OF PLACE TRADEMARK. Unless otherwise agreed by Landlord, Tenant
shall continue to utilize the "Place" tradename during the Term in connection
with the identification, operation, marketing, and advertising of the Projects.

                                   ARTICLE 17

                                 INDEMNIFICATION

     Notwithstanding the existence of any insurance provided for in Article 9
but subject to Section 9.3, and without regard to the policy limits of any such
insurance, Tenant will protect, indemnify, save harmless and defend Landlord and
its directors, officers, members, partners, employees, and agents from and
against all liabilities, obligations, claims, damages, penalties, causes of
action, costs and expenses (including, without limitation, reasonable attorneys'
fees


                                      -60-

<PAGE>

and expenses), to the extent permitted by law, imposed upon or incurred by or
asserted against Landlord by reason of: (a) any accident, injury to or death of
persons or loss of personal property occurring on or about the Leased Property,
(b) any Impositions which are the obligations of Tenant to pay pursuant to
applicable provisions of this Lease, and (c) any failure on the part of Tenant
to perform or comply with any of the terms of this Lease. Any amounts which
become payable by Tenant under this section shall be paid within thirty (30)
days after liability therefor on the part of Tenant is determined by litigation
or otherwise and, if not timely paid, shall bear a late charge (to the extent
permitted by law) at the Overdue Rate from the date of such determination to the
date of payment. Tenant, at its expense, shall contest, resist and defend any
such claim, action or proceeding asserted or instituted against Landlord or may
compromise or otherwise dispose of the same, with Landlord's prior written
consent (which consent may not be unreasonably withheld or delayed). Nothing
herein shall be construed as indemnifying Landlord against its own negligence or
omissions or willful misconduct. Tenant's liability for a breach of the
provisions of this Article shall survive any termination and the expiration of
this Lease.

     In the event of any claim pursuant to this Article 17 which is covered by
any insurance maintained by Tenant pursuant to Article 9 hereof, Landlord shall
exhaust any rights of recovery against any such insurance prior to pursuing any
recourse against Tenant.

                                   ARTICLE 18

                                    BROKERAGE

     Landlord and Tenant represent and warrant that no broker, commission agent,
real estate agent or salesman has participated in the negotiation or execution
of this Lease other than Blue Vista Capital ("Broker"), which has acted as
Tenant's broker with regard to this Lease. Broker's fee, if any, shall be paid
by Tenant pursuant to a separate agreement between Tenant and Broker. No other
person, firm, corporation, or other entity is or shall be entitled to the
payment of any fee, commission, compensation, or other form of remuneration in
connection herewith in any manner. Landlord shall and does hereby indemnify and
agree to hold Tenant harmless from and against any claims, demands, actions and
judgments of any and all brokers, agents and other intermediaries alleging a
commission, fee or other payment to be owing by reason of Landlord's dealings,
negotiations or communications in connection with this Lease or the demise of
the Leased Property. Likewise, Tenant shall and does hereby indemnify and agree
to hold Landlord harmless from and against any claims, demands, actions and
judgments of any and all brokers, agents and other intermediaries (including
Broker) alleging a commission, fee or other payment to be owing by reason of
Tenant's dealings, negotiations or communications in connection with this Lease
or the demise of the Leased Property.

                                   ARTICLE 19

                             SURRENDER; HOLDING OVER

     19.1 SURRENDER. Upon the expiration or prior termination of this Lease,
Tenant, will vacate and surrender the Leased Property to Landlord in the
condition in which the Leased Property was originally received from Landlord,
except as improved, constructed, repaired,


                                      -61-

<PAGE>

rebuilt, restored, altered or added to as permitted or required by the
provisions of this Lease and except for ordinary wear and tear (subject to the
obligation of Tenant to maintain the Leased Property in good order and repair
during the Term), damage caused by the gross negligence or willful acts of
Landlord and damage or destruction described in Article 10 or resulting from a
Taking which Tenant is not required by the terms of this Lease to repair or
restore.

     19.2 HOLDING OVER. If Tenant shall for any reason remain in possession of
the Leased Property after the expiration of the Term or any earlier termination
of the Term, such possession shall be as a tenancy at will during which time
Tenant shall pay as rental each month, one hundred and ten percent (110%) of the
aggregate of (a) one-twelfth of the aggregate Base Rent and Additional Rent
payable with respect to the last complete Lease Year prior to the expiration of
the Term; (b) all Additional Charges accruing during the month and (c) all other
sums, if any, payable by Tenant pursuant to the provisions of this Lease with
respect to the Leased Property. During such period of tenancy, Tenant shall be
obligated to perform and observe all of the terms, covenants and conditions of
this Lease. Nothing contained herein shall constitute the consent, express or
implied, of Landlord to the holding over of Tenant after the expiration or
earlier termination of this Lease.

     19.3 COOPERATION. Upon termination of this Lease and for reasonable periods
of time immediately before and after such termination, Tenant shall use its best
efforts to facilitate an orderly transfer of the operation of the Leased
Property to Landlord or any new tenant or operator selected by Landlord, it
being understood and agreed that such cooperation shall include, without
limitation, Tenant's assignment, if and to the extent allowed by law, to
Landlord or Landlord's new tenant or operator of any and all tenant subleases,
service contracts, licenses, and permits, delivery to Landlord all originals or
executed copies of leases and all related tenant files, delivery to Landlord of
all tenant security deposits, prepaid rents, or other monies held for any
subtenant, and delivery of all keys to the Leased Property. In connection with
such termination, all income and Operating Expenses of the Leased Property shall
be prorated between Landlord and Tenant as of the date of such termination, with
subsequent adjustments to the extent accurate information is not available as of
the date of Lease termination. Further, Landlord shall pay to Tenant on a dollar
for dollar basis an amount equal to any rents, reserves, escrows, or similar
funds held by any Project Mortgagees as of the date of Lease termination which
were funded by Tenant from Gross Rentals and not previously credited against
Base Rent or Additional Rent owed by Tenant under this Lease. For purposes of
effecting the assignments and transfers herein described, Tenant hereby
irrevocably designates and appoints Landlord its true and lawful agent and
attorney-in-fact, either in the name of Landlord or in the name of Tenant to do
all acts and things and execute all documents which Landlord may deem necessary
or advisable to effect the transfers and assignments described herein,
including, without limitation preparing, signing and filing any and all
agreements, documents, and applications necessary to effect such transfers or
assignments. Any recording fees or out-of-pocket expenses relating to the
foregoing (not including any attorneys' fees incurred by Tenant) shall be at
Landlord's sole cost and expense. After termination of this Lease, Landlord
shall discontinue use of the "Place" tradename in connection with the Leased
Property in accordance with the terms of the license agreement between Landlord
and Tenant regarding such name.


                                      -62-

<PAGE>

                                   ARTICLE 20

                              TRANSFERS BY LANDLORD

     20.1 SALE RESTRICTION. Landlord shall not, without Tenant's prior written
consent, have the right to sell any individual Property prior to the expiration
of the third (3rd) Lease Year if such sale would result in the termination of
this Lease with respect to such Property. In addition, without Tenant's prior
written consent, Landlord shall not have the right to sell Carrollton Place,
Southern Place, Berkeley Place, or Western Place during the term of the Existing
Mortgage Loan if such sale would result in the termination of this Lease with
respect to any such Property. Further, after the third (3rd) Lease Year,
Landlord shall not have the right to sell any individual Property without
Tenant's prior written consent if (i) such sale would result in the termination
of this Lease with respect to such Property, and (ii) as a result of the release
of such Property from this Lease, the Net Operating Income from the remaining
Properties would fall below an amount equal to 1.05 times annual Base Rent
(excluding the Base Rent attributable to the released Property), based upon the
Net Operating Income of the remaining Properties for the most recent calendar
quarter for which financial statements have been provided pursuant to Section
14.2 hereof. Notwithstanding the foregoing, this Section 20.1 shall not apply to
(x) any foreclosure sale under the Existing Mortgage Loan or any Superior
Mortgage, as defined in Section 15.2 hereof, (y) any conveyance in lieu of a
foreclosure under the Existing Mortgage Loan or any such Superior Mortgage, or
(z) any Condemnation.

     20.2 SALES - GENERAL. Except as provided in Section 20.1 above, Landlord
may sell all or any portion of its interest in the Leased Property without
requirement of Tenant's consent, but subject to the terms of Section 2.4(b)
above, to the extent applicable. Landlord shall have the right to terminate this
Lease with respect to any individual Property in connection with the sale
thereof, as provided in Section 2.4(b). Subject to Section 2.5, Tenant agrees
that any purchaser of Landlord's entire interest in the Leased Property shall be
a successor in interest to Landlord under this Lease and may exercise any and
all rights of Landlord, as fully as if such purchaser were the original landlord
hereunder provided. Landlord may divulge to the purchaser of any Property all
information, reports, financial statements, certificates and documents obtained
by it from Tenant with respect to such Property. If Landlord or any successor
owner of Landlord's interest in the entire Leased Property shall convey such
interest in the Leased Property, other than as security for a debt, the
purchaser of such interest in the Leased Property shall expressly assume all
obligations of Landlord hereunder arising or accruing from and after the date of
such conveyance or transfer. Landlord shall transfer any Letter of Credit, any
Cash Collateral, and the Capital Improvement Reserve to such successor owner,
Landlord or such successor owner, as the case may be, shall thereupon be
released from all future liabilities and obligations of the Landlord under this
Lease arising or accruing from and after the date of such conveyance or other
transfer as to Landlord's interest in the Leased Property and all such future
liabilities and obligations shall thereupon be binding upon the new owner. At
the time of any transfer, Tenant shall be provided full and complete information
as to the identity of any purchaser of the Leased Property and copies of the
documentation effecting the transfer and assumption of Landlord's rights and
obligations under this Lease.


                                      -63-

<PAGE>

                                   ARTICLE 21

                                 QUIET ENJOYMENT

     21.1 QUIET ENJOYMENT. So long as Tenant shall pay all Rent as the same
becomes due and shall fully comply with all of the terms of this Lease and fully
perform its obligations hereunder, Tenant shall peaceably and quietly have, hold
and enjoy the Leased Property for the Term, free of any claim or other action by
Landlord or anyone claiming by, through or under Landlord, but subject to all
liens and encumbrances of record as of the date hereof or hereafter consented to
by Tenant. Tenant shall have the right by separate and independent action to
pursue any claim it may have against Landlord as a result of a breach by
Landlord of the covenant of quiet enjoyment contained in this Article 21.

                                   ARTICLE 22

                                     NOTICES

     22.1 NOTICES. All notices, demands, consents, approvals, requests and other
communications required or permitted to be given under this Lease shall be in
writing and shall be (a) delivered in person, (b) sent by Federal Express,
Express Mail or other comparable courier addressed to the appropriate party at
the address set out below, or (c) transmitted by facsimile transmission to the
facsimile number for each party set forth below (provided a copy is sent by the
method described in (b) for Next Business Day delivery):

     (a) if to Tenant: c/o Place Properties, L.P.
                       Two Live Oak, Suite 1400
                       3445 Peachtree Road, NE
                       Atlanta, Georgia 30326
                       Attention: Robert E. Clark
                       Phone: (404) 495-7554
                       Fax: (404) 495-7555

     with copies to:   c/o Place Properties, L.P.
                       Two Live Oak, Suite 1400
                       3445 Peachtree Road, NE
                       Atlanta, Georgia 30326
                       Attention: Cecil M. Phillips
                       Phone: (404) 495-7521
                       Fax: (404) 495-7523

          and:         Smith Gambrell & Russell, LLP
                       Suite 3100, Promenade II
                       1230 Peachtree Street, NE
                       Atlanta, Georgia 30309-3592
                       Attention: Malcolm D. Young, Jr., Esq.
                       Phone: (404) 815-3774
                       Fax: (404) 685-7074


                                      -64-

<PAGE>

     (b) if to Landlord:  c/o Education Realty Trust, Inc.
                          530 Oak Court Drive, Suite 300
                          Memphis, Tennessee 38117
                          Attention: Paul Bower
                          Phone: (901) 259-2500
                          Fax: (901) 259-2594

          with a copy to: Morris, Manning & Martin, LLP
                          1600 Atlanta Financial Center
                          3343 Peachtree Road, N.E.
                          Atlanta, Georgia  30326-1044
                          Attention: Andrew C. Williams, Esq.
                          Phone: (404) 233-7000
                          Fax: (404) 365-9532

     Each notice, demand, consent, approval, request and other communication
shall be effective upon receipt and shall be deemed to be duly received if
delivered in person or by a national courier service, when left at the address
of the recipient and if sent by facsimile, upon receipt by the sender of an
acknowledgment or transmission report generated by the machine from which the
facsimile was sent indicating that the facsimile was sent in its entirety to the
recipient's facsimile number; provided that if a notice, demand, consent,
approval, request or other communication is served by hand or is received by
facsimile on a day which is not a Business Day, or after 5:00 p.m. on any
Business Day at the addressee's location, such notice or communication shall be
deemed to be duly received by the recipient at 9:00 a.m. on the first Business
Day thereafter. Rejection or other refusal by the addressee to accept, or the
inability to deliver because of a changed address or changed facsimile number of
which no notice was given, shall be deemed to be receipt of the notice, demand,
consent, approval, request or communication sent. Any party shall have the
right, from time to time, to change the address or facsimile number to which
notice to it shall be sent by giving to the other party or parties at least ten
(10) days prior notice of the changed address or changed facsimile number.

                                   ARTICLE 23

                                  MISCELLANEOUS

     23.1 GENERAL. Anything contained in this Lease to the contrary
notwithstanding, all claims against, and liabilities of, Tenant or Landlord
arising prior to any date of expiration or termination of this Lease shall
survive such expiration or termination. If any term or provision of this Lease
or any application thereof shall be invalid or unenforceable, the remainder of
this Lease and any other application of such term or provision shall not be
affected thereby and a like but valid and enforceable provision shall replace
the invalid or unenforceable provision. If any interest provided for in any
provision of this Lease are based upon a rate in excess of the maximum rate
permitted by applicable law, the parties agree that such charges shall be fixed
at the maximum permissible rate.

     23.2 AGREEMENT OF PRINCIPALS. Contemporaneously herewith, Cecil M. Phillips
and Place Properties, L.P. are delivering to Landlord an Agreement of Principals
in the form attached


                                      -65-

<PAGE>

hereto as Exhibit F pursuant to which said parties are agreeing to be personally
liable for liabilities, losses, and damages incurred by Landlord as a result of
certain actions on the part of Tenant with respect to the Leased Property.

     23.3 ENTIRE AGREEMENT; MODIFICATIONS. This Lease embodies and constitutes
the entire understanding between the parties with respect to the transactions
contemplated herein, and all prior to contemporaneous agreements,
understandings, representations and statements (oral or written) are merged into
this Lease. Neither this Lease nor any provision hereof may be modified or
amended except by an instrument in writing signed by Landlord and Tenant.

     23.4 NON-RECOURSE AS TO LANDLORD. Anything contained herein to the contrary
notwithstanding, any claim based on or in respect of any liability of Landlord
under this Lease shall be enforced only against Landlord's interest in the
Leased Property and not against any other assets, properties or funds of (i)
Landlord, (ii) any director, officer, general partner, member, shareholder,
limited partner, beneficiary, employee or agent of Landlord or any general
partner or manager of Landlord or any of its general partners or members (or any
legal representative, heir, estate, successor or assign of any thereof), (iii)
any predecessor or successor partnership or corporation (or other entity) of
Landlord or any of its general partners, members, shareholders, officers,
directors, employees or agents, either directly or through Landlord or its
general partners, members, shareholders, officers, directors, employees or
agents or any predecessor or successor partnership or corporation (or other
entity), or (iv) any person affiliated with any of the foregoing, or any
director, officer, employee or agent of any thereof.

     23.5 LIMITATION ON LIABILITY OF TENANT RELATED PARTIES. Except as otherwise
provided in that certain Agreement of Principals referenced in Section 23.2
above, any claim based on or in respect of any liability of Tenant under this
Lease shall be enforced only against the assets, properties and funds of Tenant
and not against (i) any director, officer, general partner, member, manager,
shareholder, limited partner, beneficiary, employee or agent of Tenant or any of
its general partners or members (or any legal representative, heir, estate,
successor or assign of any thereof), (ii) any predecessor or successor limited
liability company, partnership or corporation (or other entity) of Tenant or any
of its general partners, members, shareholders, officers, directors, employees
or agents, either directly or through Tenant or its general partners, members,
shareholders, officers, directors, employees or agents or any predecessor or
successor limited liability company partnership or corporation (or other
entity), or (iii) any Person affiliated with any of the foregoing, or any
director, officer, employee or agent of any thereof.

     23.6 COUNTERPARTS. This Lease may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same instrument.

     23.7 NO WAIVER. No failure by Landlord or Tenant to insist upon the strict
performance of any term hereof or to exercise any right, power or remedy
consequent upon a breach thereof, and no acceptance of full or partial payment
of Rent during the continuance of any such breach, shall constitute a waiver of
any such breach or any such term. To the extent permitted by law, no waiver of
any breach shall affect or alter this Lease, which shall continue in full force
and effect with respect to any other then existing or subsequent breach.


                                      -66-

<PAGE>

     23.8 SURRENDER. No surrender to Landlord of this Lease or of the Leased
Property or any part of any thereof, or of any interest therein, shall be valid
or effective unless agreed to and accepted in writing by Landlord and no act by
Landlord or any representative or agent of Landlord, other than such a written
acceptance by Landlord, shall constitute an acceptance of any such surrender.

     23.9 NO MERGER OF TITLE. There shall be no merger of this Lease or of the
leasehold estate created hereby by reason of the fact that the same person,
firm, corporation or other entity may acquire, own or hold, directly or
indirectly, (a) this Lease or the leasehold estate created hereby or any
interest in this Lease or such leasehold estate and (b) the fee estate in the
Leased Property.

     23.10 APPLICABLE LAW, ETC. Except to the extent that Landlord's remedies
hereunder with respect to a particular Property may be controlled by the laws of
the state in which such Property is located, it is the intention of the parties
that, to the maximum extent permitted by the laws of the states in which the
Properties are located, this Lease shall be interpreted, construed, applied and
enforced in accordance with the laws of the State of Georgia applicable to
contracts and non-residential leases which are made and to be performed entirely
within such state, regardless of (i) where this Agreement is executed or
delivered; or (ii) where any payment or other performance required by this
Agreement is made or required to be made; or (iii) where any breach of any
provision of this Agreement occurs, or any cause of action otherwise accrues; or
(iv) where any action or other proceeding is instituted or pending; or (v) the
principal place of business or jurisdiction of organization or domestication of
any party; or (vi) whether the laws of the forum jurisdiction otherwise would
apply the laws of a jurisdiction other than the State of Georgia; or (vii) any
combination of the foregoing. To the maximum extent permitted by applicable law,
any action to enforce, arising out of, or relating in any way to, any of the
provisions of this Agreement may be brought and prosecuted in such court or
courts located in the State of Georgia as is provided by law; and the parties
consent to the jurisdiction of said court or courts located in the State of
Georgia and to service of process by registered mail, return receipt requested,
or by any other manner provided by law.

     23.11 COVENANTS BINDING. The covenants, agreements, terms, provisions and
conditions of this Lease shall be binding upon and inure to the benefit of the
successors and assigns of the Landlord and, except as otherwise prohibited
herein, the successors and assigns of the Tenant.

     23.12 HEADINGS. The headings to the various Articles and Sections of this
Lease have been inserted for purposes of reference only and shall not limit or
define or otherwise affect the express terms and provisions of this Lease.

     23.13 RELATIONSHIP OF THE PARTIES. Nothing contained herein shall be deemed
or construed by the parties hereto, or any third party, as creating the
relationship of principal and agent or a partnership or joint venture between
the parties hereto, it being understood and agreed that neither the method of
computation of Rent nor any other provision contained herein, nor any acts of
the parties hereto, shall be deemed to create any relationship between the
parties hereto other than the relationship of landlord and tenant.


                                      -67-

<PAGE>

     23.14 ATTORNEYS' FEES. In the event of any dispute arising out of the
subject matter of this Lease, the prevailing party shall be entitled to recover,
in addition to any other damages assessed, its reasonable attorneys' fees and
other costs and expenses incurred in litigating or otherwise settling or
resolving such dispute.

     23.15 TIME. Time is of the essence of this Lease and in all of the
conditions, obligations, agreements, provisions, terms and covenants hereof.

     23.16 SURVIVAL. This Lease shall survive the expiration of the Term to the
extent necessary that any term, covenant or condition of this Lease which
requires the performance of obligations or forbearance of an act by either party
hereto after the termination of this Lease. Such survival shall be to the extent
reasonably necessary to fulfill the intent thereof, or if specified, to the
extent of such specification, as same is reasonably necessary to perform the
obligations and/or forbearance of an act set forth in such term, covenant or
condition. In the event of the termination of this Lease by expiration of the
stated Term or for any other cause or reason whatsoever prior to the final
determination of Rent or other amounts due hereunder, each party's agreement to
pay any such sums shall survive termination of this Lease, and each party shall
pay any such amounts due to the other within thirty (30) days after being billed
therefor. Notwithstanding the foregoing, in the event a specific term, covenant
or condition is expressly provided for in such a clear fashion as to indicate
that such performance of an obligation or forbearance of an act is no longer
required, then the specific shall govern over the general provisions of the
Lease.

                                   ARTICLE 24

                               MEMORANDUM OF LEASE

     24.1 MEMORANDUM. Landlord and Tenant, promptly upon the request of either,
shall enter into a short form memorandum of this Lease, in form suitable for
recording under the laws of each state in which each Leased Property is located,
in which reference to this Lease shall be made. The parties shall share equally
all costs and expenses of recording such memorandum.

                                   ARTICLE 25

                                   ARBITRATION

     25.1 All disputes arising under this Lease concerning the interpretation,
application, or enforcement of any of the terms of this Lease shall be finally
resolved pursuant to an arbitration before a panel of three (3) arbitrators who
will conduct the arbitration proceeding in accordance with the provisions of
this Agreement and the rules of the American Arbitration Association ("AAA").
Unless otherwise mutually agreed by Landlord and Tenant, the arbitration
proceedings will be conducted in Atlanta, Georgia. All arbitrators appointed by
or on behalf of either party shall be independent persons with recognized
expertise in the operation of apartment projects of similar size and class as
the Projects with not less than five (5) years' experience in the apartment
industry. The party desiring arbitration will give written notice to that effect
to the other party, specifying in such notice the name, address and professional
qualifications of the person designated as arbitrator on its behalf. Within
fifteen (15) days after service of such notice, the other party will


                                      -68-

<PAGE>

give written notice to the party desiring such arbitration specifying the name,
address and professional qualifications of the person designated to act as
arbitrator on its behalf. The two arbitrators will, within fifteen (15) days
thereafter, select a third, neutral arbitrator. As soon as possible after the
selection of the third arbitrator, and no later than fifteen (15) days
thereafter, the parties will submit their positions on each disputed item in
writing to the three arbitrators. The arbitrators are instructed and directed to
assume case management, initiative, and control of the arbitration process and
to initiate early scheduling to assure resolution of the disputes as
expeditiously as reasonably possible. To assist the arbitrators in this
determination, and after consultation with the parties, the arbitrators may
appoint one or more technical experts who are neutral, impartial and independent
of the parties and others having any known interest in the outcome of the
arbitration who may advise and provide information to the arbitrators; provided,
however, that if and to the extent the arbitrators use or rely on such technical
experts, any substantive advice given by such experts to the arbitrators shall
also be provided to both parties in the form of a brief written summary, and the
parties shall be afforded a fair opportunity to comment or respond. The decision
of the arbitrators so chosen shall be given within a period of twenty (20) days
after the appointment of such third arbitrator. In rendering their decision the
arbitrators shall not add to, subtract from, or otherwise modify the provision
of this Lease. A decision in which any two (2) arbitrators so appointed and
acting hereunder concur in writing with respect to each disputed item shall in
all cases be binding and conclusive upon Landlord and Tenant and a copy of said
decision shall be forwarded to the parties. Judgment may be entered in any court
of competent jurisdiction on the decision and award of the arbitrators so
rendered.

     25.2 The parties request that the arbitrators assess the costs and expenses
of the Arbitration and their fees against the parties based on a finding as to
which parties substantive positions were not upheld. Otherwise the fees and
expenses of the arbitration will be treated as an Operating Expense unless
otherwise determined by the arbitrators.

     25.3 If the party receiving a request for Arbitration fails to appoint its
arbitrator within the time above specified, or if the two arbitrators so
selected cannot agree on the selection of the third arbitrator within the time
above specified, then either party, on behalf of both parties, may request such
appointment of such second or third arbitrator, as the case may be, by
application to the Atlanta, Georgia office of the AAA upon ten (10) days' prior
written notice to the other party of such intent.

     25.4 Without limiting the generality of Section 25.1 above, if there shall
be a dispute with respect to whether a party has unreasonably withheld,
conditioned or delayed its consent with respect to a matter for which such party
has agreed herein not to unreasonably withhold its consent, such dispute shall
be resolved by Arbitration.

     25.5 Notwithstanding any provision in this section to the contrary, either
party has the right to obtain temporary restraining orders and temporary or
preliminary injunctive relief or such similar judicial or administrative ruling,
order or decree from a court of competent jurisdiction for the purpose of
protecting any rights or privileges granted hereunder.

                     [Signatures appear on following pages]


                                      -69-

<PAGE>

     IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be
executed by their incumbent and duly authorized representatives as of the date
set forth below.

                                        LANDLORD:

                                        EDUCATION REALTY OPERATING PARTNERSHIP,
                                        LP, a Delaware limited partnership

                                        By: Education Realty OP GP, Inc., its
                                            General Partner


                                        By: /s/ Paul O. Bower
                                            ------------------------------------
                                            Paul O. Bower, President


                                        TENANT:

                                        PLACE PORTFOLIO LESSEE, LLC, a Georgia
                                        limited liability company


                                        By: /s/ Cecil M. Phillips
                                            ------------------------------------
                                            Cecil M. Phillips, Manager

<PAGE>

                                    EXHIBIT A

                              PROPERTY DESCRIPTIONS


                               Exhibit A - Page 1

<PAGE>

                                    EXHIBIT B

                             ALLOCATION OF BASE RENT

<TABLE>
<CAPTION>
                              INITIAL
      PROPERTY         BASE RENT ALLOCATION
      --------         --------------------
<S>                    <C>
Berkeley Place              $ 1,330,725
Cape Place                      766,800
Carrollton Place                832,000
Clayton Place I & II          2,357,300
Clemson Place                   757,300
Jacksonville Place            1,151,500
Macon Place                     743,000
Martin Place                    796,025
Murray Place                    713,000
River Place                   1,083,600
Statesboro Place              1,362,300
Troy Place                      945,600
Western Place                   897,600
                            -----------
   Total Base Rent          $13,736,750
                            ===========
</TABLE>


                               Exhibit B - Page 1

<PAGE>

                                    EXHIBIT C

                            FORM OF LETTER OF CREDIT

DATE: _______________________

                    IRREVOCABLE STANDBY LETTER OF CREDIT NO.

TO: ________________________________________

WE HEREBY ESTABLISH OUR IRREVOCABLE LETTER OF CREDIT NO. ______ IN YOUR FAVOR AT
THE REQUEST AND FOR THE ACCOUNT OF _________________, FOR THE SUM OF FIVE
MILLION AND NO/100 DOLLARS (US $5,000,000.00) AVAILABLE BY YOUR SIGHT DRAFT ON
US, ACCOMPANIED BY A STATEMENT SWORN BEFORE A NOTARY PUBLIC AND PURPORTEDLY
SIGNED BY AN AUTHORIZED REPRESENTATIVE OF BENEFICIARY STATING THE FOLLOWING:

          "The undersigned, an authorized representative of Beneficiary, hereby
          certifies under oath that either (i) an Event of Default by Tenant in
          paying Base Rent or Additional Rent has occurred under the terms of
          that certain Lease Agreement dated __________, between Beneficiary and
          [name of Tenant] (the "Lease"), (ii) a deficiency in Net Operating
          Income exists under Section 12.2(c)(i) of the Lease, or (iii) Tenant
          has failed to renew or replace the Letter of Credit as required under
          Section 3.9(h) of the Lease and, therefore, Beneficiary is entitled to
          draw [insert amount of draw] under [Bank] Letter of Credit No.
          ______________."

PARTIAL DRAWINGS ARE PERMITTED.

ALL DRAFTS SO DRAWN MUST BE MARKED "DRAWN UNDER ____________________________
STANDBY LETTER OF CREDIT NO. ______________, DATED ______________.

THIS CREDIT EXPIRES AT OUR COUNTERS ON __________________. IT SHALL NOT BE
NECESSARY FOR THE ORIGINAL OF THIS LETTER OF CREDIT TO ACCOMPANY ANY DRAWINGS
EXCEPT IN THE CASE OF ANY DRAW OF THE ENTIRE AMOUNT REMAINING UNDER THE LETTER
OF CREDIT.

WE HEREBY ENGAGE WITH YOU THAT ALL DRAFTS DRAWN UNDER AND IN COMPLIANCE WITH THE
TERMS OF THIS LETTER OF CREDIT WILL BE DULY HONORED BY US UPON PRESENTATION.

THIS STANDBY LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR
DOCUMENTARY CREDITS, INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 500 (1993
REVISION).

[NAME OF BANK]


                               Exhibit C - Page 1

<PAGE>

                                    EXHIBIT D

                              INTENTIONALLY OMITTED


                               Exhibit D - Page 1

<PAGE>

                                    EXHIBIT E

                          FORM OF OFFICER'S CERTIFICATE

Education Realty Operating Partnership, LP
530 Oak Court Drive, Suite 300
Memphis, Tennessee 38117
Attn: Randall H. Brown

Ladies and Gentlemen:

     Reference is made to the Lease Agreement dated as of January 1, 2006 (the
"Lease Agreement") by and among Education Realty Operating Partnership, L.P.
(the "Landlord") and Place Portfolio Lessee, LLC (the "Tenant"). Terms defined
in the Lease Agreement and not otherwise defined herein are used herein as
defined in the Lease Agreement.

     Pursuant to the Lease Agreement, the undersigned officer hereby certifies
     as follows:

          (i) To the best knowledge of the undersigned officer (but without
     affirmative investigation), the representations and warranties of Tenant
     contained in Sections 16.1 and 16.2 of the Lease Agreement are true and
     correct as of the date hereof [Note: If there has been a change in the
     representations and warranties, this certificate should be revised to
     describe such changes]; and

          (ii) The undersigned officer has no knowledge (without affirmative
     investigation) of the existence of any Event of Default under the terms of
     the Lease Agreement [Note: If the signer does have knowledge of any Event
     of Default, the form of certificate should be revised to specify the Event
     of Default, the nature thereof and the actions taken, being taken or
     proposed to be taken by the Tenant with respect thereto].

     This certificate is submitted in compliance with requirements of Section
14.2(a) of the Lease Agreement. The undersigned officer is the _____________ of
the Tenant.

     IN WITNESS WHEREOF, I have hereunto set my hand this ____ day of
_____________, 200__.


                               Exhibit E - Page 1

<PAGE>

                                    EXHIBIT F

                         FORM OF AGREEMENT OF PRINCIPALS

     THIS AGREEMENT OF PRINCIPALS (this "Agreement") is made as of the ___ day
of ____________, 2006, by CECIL M. PHILLIPS, an individual resident of the State
of Georgia, and PLACE PROPERTIES, L.P., a Tennessee limited partnership
("Place") (each such party being hereinafter sometimes individually referred to
as a "Principal," and collectively as the "Principals"), in favor and for the
benefit of EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited
partnership (hereinafter referred to as "Landlord");

                                    RECITALS

     A. On or prior to the date hereof, Landlord or affiliates of Landlord have
acquired ownership of the entities those certain student housing properties
listed on Exhibit "A" attached hereto (said properties and all improvements
located thereon are hereinafter collectively called the "Leased Property") from
affiliates of the Principals.

     B. Concurrently herewith, Landlord is leasing the Leased Property to Place
Portfolio Lessee, LLC ("Tenant") pursuant to the terms and conditions set forth
in that certain Lease Agreement between Landlord and Tenant dated of even date
herewith (the "Lease").

     C. The Tenant is an affiliate of the Principals.

     D. To induce Landlord to acquire the Leased Property and enter into the
Lease, each Principal has agreed to enter into this Agreement, each Principal
acknowledging that without this Agreement Landlord would be unwilling to acquire
ownership of the entities owning the Leased Property or enter into the Lease.

                                   AGREEMENTS

     NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Principals hereby agree and covenant as follows:

     1. Definitions. All capitalized terms not otherwise defined herein shall
have the meanings assigned to such terms in the Lease. In addition, for purposes
of this Agreement the term "Retained Liabilities" shall collectively refer to
the Retained Greenwich Liabilities, as defined in Section 2 below, and the
Retained Lease Liabilities, as defined in Section 3 below.

     2. Retained Greenwich Liabilities. The Principals shall, jointly and
severally with Tenant, be personally liable for all losses, damages, costs,
liabilities, and expenses, including attorneys' fees, suffered or incurred by
Landlord under the terms of the Existing Mortgage Loan as a result of the
following (collectively called the "Retained Greenwich Liabilities"):


                               Exhibit F - Page 1

<PAGE>

          (a) fraud or intentional misrepresentation by Tenant or any Affiliate
     of Tenant in connection with the Existing Mortgage Loan;

          (b) any removal or disposal of any personal property located on any
     individual Property by Tenant, its Affiliates, officers, employees or
     agents, including Manager, to the extent such personal property is not
     replaced by Tenant with like property of equivalent value;

          (c) subject to Landlord's fulfillment of its obligations under the
     Lease with respect to capital repairs and replacements, Tenant's waste of
     any portion of the Leased Property;

          (d) Tenant's failure to apply any insurance proceeds or condemnation
     awards received by Tenant relating to the Leased Property in accordance
     with the provisions of the Lease;

          (e) Tenant's failure during the term of the Existing Mortgage Loan to
     deliver to Existing Lender any rents and revenues (including, without
     limitation, prepaid rents and security deposits) received or collected by
     Tenant from the Properties which are subject to the Existing Mortgage Loan,
     as required pursuant to the terms of Section 15.4(g) of the Lease;

          (f) Tenant's failure to utilize funds disbursed by Existing Lender to
     Tenant for the payment of Operating Expenses in accordance with an annual
     operating budget which has been approved by Existing Lender; and

          (g) the failure of Tenant or any Affiliate of Tenant to comply with
     the covenants, obligations, liabilities, warranties, and representations
     contained in Sections 4.16, 5.7, 5.8, 5.24, 5.25 and 5.26 of the Existing
     Loan Agreement prior to the date of the Lease.

     3. Retained Lease Liabilities. In addition to the Retained Greenwich
Liabilities, Place shall, jointly and severally with Tenant, be personally
liable for all losses, damages, costs, liabilities, and expenses, including
attorneys' fees, suffered or incurred by Landlord as a result of the following
(collectively called the "Retained Lease Liabilities"):

          (a) fraud or intentional misrepresentation by Tenant in connection
     with the Lease;

          (b) Tenant's failure to apply any insurance proceeds or condemnation
     awards relating to the Leased Property in accordance with the provisions of
     the Lease;

          (c) Tenant's failure to utilize Gross Rentals received or collected by
     Tenant from the Leased Property for payment of current Operating Expenses
     and Rent prior to distribution or payment to any Tenant Related Party
     (except to the extent any such payment is in respect of an Operating
     Expense);

          (d) Tenant's failure to utilize any funds disbursed by Landlord to
     Tenant for the payment of Capital Expenditures for such purpose;


                               Exhibit F - Page 2

<PAGE>

          (e) Tenant's failure or refusal to deliver any prepaid rents and
     security deposits to Landlord upon the termination of the Lease;

          (f) Any distributions or payments made by Tenant to any Tenant Related
     Party in violation of Section 16.7 of the Lease; and

          (g) Tenant's failure to comply with Tenant's covenants and obligations
     pursuant to Section 4.5(a) and (b) of the Lease.

     4. Primary Liability. The liability of each Principal under this Agreement
shall be direct and immediate as a primary and not a secondary obligation or
liability, and is not conditional or contingent upon the pursuit of any remedies
against Tenant, any other Principal, or any other person, or against any
security for Tenant's obligations under the Lease held by Landlord. Each
Principal waives any rights which it may have to require that (a) Landlord first
proceed against Tenant, any other Principal, or any other person or entity with
respect to the Retained Liabilities, (b) Landlord first proceed against any
collateral held by Landlord with respect to the Lease, or (c) any other party be
joined in any proceeding to enforce the Retained Liabilities.

     5. Waiver of Subrogation Rights. Each Principal waives any rights to
enforce any remedy which Landlord may have against Tenant, and any rights of
indemnity, reimbursement, contribution or subrogation which any Principal may
have against Tenant or against any other Principal, with respect to the Retained
Liabilities.

     6. Amendments/Release. Each Principal hereby consents and agrees that
Landlord may at any time, and from time to time, without notice to or further
consent from such Principal and either with or without consideration, do any one
or more of the following, all without affecting the agreements contained herein
or the liability of such Principal for the Retained Liabilities: (a) release any
other Principal hereunder; (b) surrender without substitution any collateral of
any kind or nature whatsoever held by Landlord, or by any person, firm or
corporation on Landlord's behalf or for Landlord's account, securing the
Retained Liabilities; (c) modify the terms of the Lease; (d) grant releases,
compromises, and indulgences with respect to the Lease or the Retained
Liabilities to any persons or entities now or hereafter liable thereon; or (e)
take or fail to take any action of any type whatsoever with respect to the Lease
or the Retained Liabilities.

     7. Waiver of Defenses. To the extent permitted by law, each Principal
hereby waives and agrees not to assert or take advantage of any defense based
upon:

          (a) the incapacity, lack of authority, death or disability of Tenant,
     any other Principal, or any other person or entity;

          (b) the failure of Landlord to commence an action against Tenant or
     any other Principal or any other person or entity or to proceed against or
     exhaust any security held by Landlord at any time or to pursue any other
     remedy whatsoever at any time;

          (c) any duty on the part of Landlord to disclose to any Principal any
     facts it may now or hereafter know regarding Tenant, regardless of whether
     Landlord has reason to believe that any such facts materially increase the
     risk beyond that which any Principal


                               Exhibit F - Page 3

<PAGE>

     intends to assume or has reason to believe that such facts are unknown to
     any Principal, each Principal acknowledging that it is fully responsible
     for being and keeping informed of the financial condition and affairs of
     Tenant;

          (d) lack of notice of default or demand for performance to Tenant, any
     other Principal, or any other party with respect to the Lease or the
     Retained Liabilities;

          (e) the consideration for this Agreement;

          (f) an election of remedies by Landlord, including any election to
     proceed against any collateral of any kind or nature held by Landlord, and
     whether or not any such election of remedies destroys or otherwise impairs
     the subrogation rights of the Principals or the rights of the Principals to
     proceed against Tenant or any other Principal for reimbursement, or both;

          (g) any statute or rule of law which provides that the obligation of a
     surety must be neither larger in amount nor in any other aspects more
     burdensome than that of a principal;

          (h) Landlord's election, in any proceeding instituted under the
     Federal Bankruptcy Code, of the application of Section 1111(b)(2) of the
     Federal Bankruptcy Code or any successor statute.

     8. Enforcement. Landlord shall have the right to enforce this Agreement in
separate actions against one or more of the Principals, or by an action against
some or all of the Principals, or any combination of the foregoing.

     9. Expenses of Collection. Each Principal shall pay to the Landlord on
demand any and all expenses paid or incurred by the Landlord, including
reasonable attorneys' fees and disbursements actually incurred, in connection
with the collection and enforcement of the Retained Liabilities owed by such
Principal. Until paid to the Landlord, such sums will bear interest at the
Overdue Rate set forth in the Lease.

     10. Entire Agreement. This Agreement contains the entire understanding of
the Principals and Landlord with respect to the subject matter hereof, and may
not be amended except in a writing signed by the Principals and Landlord. Should
any one or more provisions of this Agreement be determined to be illegal or
unenforceable, all other provisions hereof shall remain in full force and
effect.

     11. Binding Effect. The Principals further agree that the provisions of
this Agreement shall bind each Principal and its heirs, personal
representatives, successors, and assigns, and shall inure to the benefit of
Landlord and its successors and assigns.

     12. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Georgia.


                               Exhibit F - Page 4

<PAGE>

     13. Submission to Jurisdiction. Each Principal hereby consents and submits
to, and waives any objection to, the jurisdiction of any local, state or federal
court located within the State of Georgia for the resolution of disputes under
this Agreement.

     IN WITNESS WHEREOF, the Principals have executed this Agreement or have
caused the same to be executed by their duly authorized representatives as of
the day and year first set forth above.


                               Exhibit F - Page 5