<PAGE>

                                                                    EXHIBIT 10.1







                               ADVISORY AGREEMENT

                                     Between

                     SKB REIT, Inc., a Maryland corporation,

        SKB Operating Partnership, L.P., a Delaware limited partnership,

                                       and

             SKB Advisors LLC, a Delaware limited liability company

                            __________________, 2004

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                                TABLE OF CONTENTS


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ARTICLE 1      DEFINITIONS...................................................................1


ARTICLE 2      APPOINTMENT...................................................................6


ARTICLE 3      DUTIES OF THE ADVISOR.........................................................7

        3.1.   Organization and Offering Services............................................7
        3.2.   Acquisition Services..........................................................7
        3.3.   Asset Management Services.....................................................8
        3.4.   Shareholder Services.........................................................10

ARTICLE 4      AUTHORITY OF ADVISOR.........................................................10

        4.1.   General......................................................................10
        4.2.   Powers of the Advisor........................................................10
        4.3.   Approval by Directors........................................................10

ARTICLE 5      BANK ACCOUNTS................................................................11


ARTICLE 6      RECORDS AND FINANCIAL STATEMENTS.............................................11


ARTICLE 7      LIMITATION ON ACTIVITIES.....................................................12


ARTICLE 8      RELATIONSHIP WITH DIRECTORS AND OFFICERS.....................................12


ARTICLE 9      FEES.........................................................................12

        9.1.   Acquisition Fees.............................................................12
        9.2.   Asset Management Fees........................................................13
        9.3.   Loan Refinancing Fee.........................................................13
        9.4.   Subordinated Real Estate Commission..........................................13
        9.5.   Subordinated Share of Net Sales Proceeds.....................................14
        9.6.   Subordinated Incentive Listing Fee...........................................14
        9.7.   Termination Fee..............................................................14

ARTICLE 10     EXPENSES.....................................................................15

        10.1.  General......................................................................15
        10.2.  Reimbursement to Advisor.....................................................16
        10.3.  Limitations on Reimbursement.................................................16

ARTICLE 11     OTHER SERVICES...............................................................16


ARTICLE 12     RELATIONSHIP OF ADVISOR AND COMPANY; OTHER ACTIVITIES OF THE ADVISOR.........17

        12.1.  Relationship.................................................................17
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        12.2.  Other Activities.............................................................17
        12.3.  Time Commitment..............................................................17
        12.4.  Investment Opportunities and Allocation......................................17

ARTICLE 13     THE SKB NAME.................................................................18


ARTICLE 14     TERM AND TERMINATION OF THE AGREEMENT........................................18

        14.1.  Term   18
        14.2.  Termination..................................................................18
        14.3.  Payments on Termination and Survival of Certain Rights and Obligations.......19
        14.4.  Survival.....................................................................19
        14.5.  Redemption of OP Units.......................................................19

ARTICLE 15     ASSIGNMENT...................................................................20


ARTICLE 16     INDEMNIFICATION AND LIMITATION OF LIABILITY..................................20

        16.1.  Indemnification by the Company...............................................20
        16.2.  Indemnification by the Advisor...............................................20
        16.3.  Advisor's Liability..........................................................20

ARTICLE 17     COMPANY ADMINISTRATION.......................................................21


ARTICLE 18     MISCELLANEOUS................................................................21

        18.1.  Notices......................................................................21
        18.2.  Modification.................................................................22
        18.3.  Severability.................................................................22
        18.4.  Construction.................................................................22
        18.5.  Entire Agreement.............................................................22
        18.6.  Waiver 22
        18.7.  Number and Gender............................................................22
        18.8.  Titles Not to Affect Interpretation..........................................22
        18.9.  Counterparts.................................................................23
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                                       ii
<PAGE>


                               ADVISORY AGREEMENT

        This Advisory Agreement, dated as of ___________, 2004, is between SKB
REIT, Inc., a Maryland corporation (the "General Partner"), SKB Operating
Partnership, L.P., a Delaware limited partnership (the "OP"), and SKB Advisors
LLC, a Delaware limited liability company (the "Agreement").

                                   WITNESSETH

        WHEREAS, the General Partner intends to qualify as a real estate
investment trust (a "REIT") as defined in Section 856 through 860 of the Code
(as defined below), and to make investments of the type permitted to qualified
REITs under the Code and not inconsistent with the Articles of Incorporation or
Bylaws of the General Partner;

        WHEREAS, the General Partner and the OP (collectively, for the purposes
of this Agreement, the "Company") desire to avail themselves of the knowledge,
experience, sources of information, advice, assistance and certain facilities
available to the Advisor (as hereinafter defined) and to have the Advisor
undertake the duties and responsibilities hereinafter set forth herein on the
terms set forth in this Agreement; and

        WHEREAS, the Advisor is willing to undertake to render such services on
the terms and conditions hereinafter set forth.

        NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS

        The following defined terms used in this Advisory Agreement shall have
the meanings specified below:

        "Acquisition Expenses" means any and all expenses incurred by the
General Partner, the OP, the Advisor, or any Affiliate thereof in connection
with the selection, evaluation and acquisition of any property, including,
without limitation, legal fees and expenses, travel and communications expenses,
costs of appraisals and surveys, nonrefundable option payments on property not
acquired, accounting fees and expenses, architectural and engineering reports,
environmental and asbestos audits, title insurance and escrow fees, and
miscellaneous expenses related to selection, evaluation and acquisition of
properties, whether or not acquired.

        "Acquisition Fee" means any and all fees and commissions, exclusive of
Acquisition Expenses, paid by any Person to any other Person (including any fees
or commissions paid by or to any Affiliate of the General Partner, the OP or the
Advisor) in connection with the purchase, development or construction of a
Property, including, without limitation, real estate commissions, acquisition
fees, finder's fees, selection fees, Development Fees and Construction Fees
(except as provided in the following sentence), nonrecurring management fees,
consulting fees, loan fees or points, or any other fees or commissions of a
similar nature, however designated. Excluded shall be any commissions or fees
incurred in connection with the leasing




                                       1
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of property, and Development Fees or Construction Fees paid to any Person or
entity not affiliated with the Advisor in connection with the actual development
and construction of any Property. For the avoidance of doubt, in the event the
Company purchases a Property from an Affiliated Seller where such Property has
been developed, refurbished or re-developed by the Affiliated Seller or an
Affiliate thereof, the terms "Construction Fees" and "Development Fees" shall
not include the excess of the purchase price for such property over the
Affiliated Seller's cost to acquire, develop, refurbish and/or re-develop (as
the case may be) the Property, provided that the transaction is approved by the
Board of Directors in accordance with Sections 10.4(j) and 11.1 of the Articles
of Incorporation.

        "Advisor" means (i) SKB Advisors LLC, a Delaware limited liability
company, or (ii) any successor advisor to the Company.

        "Affiliate" has the meaning set forth in the Articles of Incorporation.
For the purposes of this Agreement, the Advisor shall not be deemed to be an
Affiliate of the Company, and vice versa.

        "Affiliated Seller" means the Sponsor, Advisor, a Director or any
Affiliate of the foregoing.

        "Appraised Value" means value according to an appraisal made by an
Independent Expert (as such term is defined in the Articles of Incorporation)
selected by the Independent Directors.

        "Articles of Incorporation" means the Amended and Restated Articles of
Incorporation of the General Partner, as amended from time to time.

        "Asset" or "Assets" means any and all property, real (improved or
unimproved), personal or otherwise, tangible or intangible, including interests
in any Person or in joint ventures, which is owned or held by, or for the
account of, the Company, whether directly or indirectly through another entity.

        "Board of Directors" means the Board of Directors of the General
Partner.

        "Bylaws" means the bylaws of the General Partner, as amended from time
to time.

        "Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor statute thereto. Reference to any provision of the Code
shall mean such provision as in effect from time to time, as the same may be
amended, and any successor provision thereto, as interpreted by any applicable
regulations as in effect from time to time.

        "Competitive Real Estate Commission" means a real estate or brokerage
commission paid for the purchase or sale of a Property which is reasonable,
customary, and competitive in light of the size, type, and location of the
Property.

        "Construction Fee" means a fee or other remuneration for acting as
general contractor and/or construction manager to construct improvements,
supervise and coordinate projects or to provide major repairs or rehabilitation
for a Property.



                                       2
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        "Dealer Manager" means SKB Real Estate Securities, Inc., an Oregon
corporation, or such other entity selected by the Board of Directors to act as
the managing dealer for the Offering. SKB Real Estate Securities, Inc. is a
member of the National Association of Securities Dealers, Inc.

        "Development Fee" means a fee for the packaging of a Property, including
negotiating and approving plans, and undertaking to assist in obtaining zoning
and necessary variances and financing for the specific Property, either
initially or at a later date.

        "Director" means a member of the Board of Directors of the General
Partner.

        "Dividends" means any distributions of money or other property by the
General Partner to owners of Shares, including distributions that may constitute
a return of capital for federal income tax purposes.

        "Gross Proceeds" means the aggregate purchase price of all Shares sold
for the account of the General Partner, without deduction for Selling
Commissions, volume discounts, any marketing support and due diligence expenses,
fees paid to the Dealer Manager or other Organization and Offering Expenses. For
the purposes of computing Gross Proceeds, the purchase price of any Share for
which reduced Selling Commissions are paid to the Dealer Manager or a
participating dealer (where net proceeds to the General Partner are not reduced)
shall be deemed to be the full amount of the offering price per Share.

        "Independent Director" "Independent Director" means a Director who is
not, and within the last two years has not been, directly or indirectly
associated with the Advisor or Sponsor. A Director shall be deemed to be
associated with the Sponsor or Advisor if he or she (i) owns an interest in the
Advisor or Sponsor or any of their Affiliates, (ii) is employed by the Advisor
or Sponsor or any of their Affiliates, (iii) is an officer, trust manager or
director of the Advisor or Sponsor or any of their Affiliates, (iv) performs
services, other than as a Director, for the General Partner, (v) serves as a
director, trust manager or trustee of more than three real estate investment
trusts advised by the Advisor or organized by the Sponsor, or (vi) has any
material business or professional relationship with the Advisor or Sponsor or
any of their Affiliates. An indirect relationship shall include circumstances in
which a Director's spouse, parents, children, siblings, mothers- or
fathers-in-law, sons- or daughters-in-law or brothers- or sisters-in-law is or
has been, within the last two years, associated with the Advisor or Sponsor or
any of their Affiliates or the General Partner. A business or professional
relationship is considered material if the gross revenue derived by the Director
from the Advisor or Sponsor and their Affiliates exceeds five percent of either
the Director's annual gross revenue during either of the last two years or the
Director's net worth on a fair market value basis.

        "Initial Asset Value" means (i) in the case of an Asset other than a
mortgage loan, the gross purchase price of real estate investments acquired
directly by the OP, including any debt attributable to such investments, or the
pro rata share of the gross asset value of real estate investments held by
entities in which the OP invests, and (ii) in the case of a mortgage loan, the
total amount of the funds advanced.



                                       3
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        "Invested Capital" means, with respect to the Shareholders, as of any
relevant date, an amount equal to the excess of (i) the aggregate amount of cash
contributed or deemed contributed by the General Partner to the OP from the
gross proceeds of the issuance by the General Partner of Shares to the
Shareholders over (ii) the cumulative amounts paid to Shareholders to repurchase
Shares under the General Partner's share repurchase plan, as of such date.

        "Listing" means the listing of Shares on a national securities exchange
or national market.

        "Listing Date" means the date on which a Listing occurs.

        "Market Value" is defined in Section 9.5 hereof.

        "Net Sales Proceeds" means, with respect to any Asset (or portion
thereof), the proceeds, if any, with respect to a any sale, exchange, taking by
eminent domain, damage, destruction or other disposition of all or any part of
such Asset, net of (a) any costs and expenses incurred in connection with such
disposition, (b) any of such proceeds which are used to repay indebtedness, (c)
any insurance proceeds applied to restoration, repair or rebuilding, and (d) any
proceeds of business interruption insurance, and after setting aside appropriate
reserves, as determined by the General Partner in its sole and absolute
discretion, provided that the receipt by the General Partner or the OP of
capital contributions shall not constitute Net Sales Proceeds; and provided
further that the proceeds of a Terminating Capital Transaction shall not
constitute Net Sales Proceeds.

        "Offering" means the public offering of Shares pursuant to the
Prospectus.

        "OP Agreement" means that certain Agreement of Limited Partnership of
the OP, dated as of __________________, 2004, as amended from time to time.

        "Operating Expenses" means all costs and expenses paid or incurred by
the General Partner, the Advisor or any of their respective Affiliates, as
determined under generally accepted accounting principles, which in any way are
related to the operation of the General Partner or to General Partner business,
including advisory expenses and fees paid to the Advisor, but excluding (i) the
expenses of raising capital such as Organization and Offering Expenses, legal,
audit, accounting, underwriting, brokerage, listing, registration and other
fees, printing and other such expenses, and taxes incurred in connection with
the issuance, distribution, transfer, registration, and stock exchange listing
of the Shares, (ii) interest payments, (iii) taxes, (iv) non-cash expenditures
such as depreciation, amortization and bad debt reserves, (v) incentive fees
paid in compliance with the Statement of Policy Regarding REITs published by the
North American Securities Administrators Association, (vi) Acquisition Fees and
Acquisition Expenses, (vii) distributions made to the Advisor pursuant to
percentage interests in the OP and (viii) real estate commissions on the resale
of Property and other expenses connected with the acquisition, disposition and
ownership of real estate interests, mortgage loans, or other property (such as
the costs of foreclosure, insurance premiums, legal services, maintenance,
repair, and improvement of property).



                                       4
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        "Organization and Offering Expenses" consists of all expenses incurred
by and to be paid from the assets of the General Partner in connection with and
in preparing the General Partner for registration and subsequently offering and
distributing its Shares to the public, including, but are not limited to: total
underwriting and brokerage discounts and commissions (including fees of the
underwriters' attorneys); legal, accounting, listing, registration and escrow
fees and expenses; expenses for printing, engraving and mailing; salaries of
employees while engaged in sales activity; charges of transfer agents,
registrars, trustees, escrow holders, depositaries and experts; expenses of
qualification of the sale of the securities under Federal and state laws,
including taxes and fees; and all advertising and marketing expenses, including
any payment or reimbursements to the Dealer Manager or other broker-dealers of
expenses associated with the offering of Shares and all other costs related to
investor and broker-dealer sales meetings.

        "Person" means an individual, corporation, partnership, estate, trust, a
portion of a trust permanently set aside for or to be used exclusively for the
purposes described in Section 642(c) of the Code, association, private
foundation within the meaning of Section 509(a) of the Code, joint stock company
or other entity and also includes a group as that term is used for purposes of
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.

        "Property" or "Properties" means any, or all, respectively, of the real
property or real estate investments which are acquired by the General Partner
either directly or through the OP, joint ventures, partnerships or other
entities.

        "Prospectus" means the General Partner's prospectus, dated as of
_____________, as amended.

        "Sale" means, with respect to any Property, any transactions or series
of transactions whereby:

        (a) the General Partner directly or indirectly (except as described in
subsection (b) of this definition sells, grants, transfers, conveys or
relinquishes its ownership of any Property, including, without limitation, any
event with respect to any Property that gives rise to insurance proceeds or
condemnation awards.

        (b) any joint venture or general partnership in which the General
Partner or the OP is a co-venturer or partner directly or indirectly sells,
grants, transfers, conveys, or relinquishes its ownership of any Property,
including any event with respect to any real property which gives rise to
insurance proceeds or condemnation awards.

        "Securities" means any class or series of units or shares of the OP or
the General Partner, including common shares or preferred units or shares and
any other evidences of equity or beneficial or other interests, voting trust
certificates, bonds, debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as "securities" or any certificates of interest,
shares or participations in, temporary or interim certificates for, receipts
for, guarantees of, or warrants, options or rights to subscribe to, purchase or
acquire, any of the foregoing.



                                       5
<PAGE>

        "Selling Commissions" means any and all commissions payable to
underwriters, dealer managers, or other broker-dealers in connection with the
sale of Shares, including, without limitation, commissions payable to the Dealer
Manager.

        "Shares" means shares of common stock of the General Partner, par value
$ .001 per share.

        "Shareholders" means the registered holders of the outstanding Shares.

        "Sponsor" means any Person directly or indirectly instrumental in
organizing, wholly or in part, the General Partner or any Person who will
control, manage or participate in the management of the General Partner, and any
Affiliate of such Person. Not included is any Person whose only relationship
with the General Partner is that of an independent property manager of General
Partner assets, and whose only compensation is as such. Sponsor does not include
wholly independent third parties such as attorneys, accountants, and
underwriters whose only compensation is for professional services.

        "Subordinated Real Estate Commission" is defined in Section 9.4(a)
hereof.

        "Subordination Condition" is defined in Section 9.3(a) hereof.

        "Termination Date" means the date of termination of this Agreement.

        "Terminating Capital Transaction" means any sale or other disposition
(other than a deemed disposition pursuant to Code Section 708(b)(1)(B) and the
Treasury Regulations thereunder) of all or substantially all of the assets of
the OP or a related series of transactions that, taken together, result in the
sale or other disposition of all or substantially all of the assets of the OP.

        "Total Asset Value" means the fair market value of the Assets of the
Company, as determined in good faith by the Independent Directors, taking into
account the Appraised Value, Initial Asset Value, improvements, book value and
other market and economic factors for any such Assets.

        "2%/25% Guidelines" has the meaning set forth in the Articles of
Incorporation.

        "8% Return" means, with respect to the Shareholders, an amount
calculated like simple interest at the rate of eight percent (8%) per annum
calculated on the varying daily balances of Invested Capital during the period
to which the 8% Return relates, and determined on the basis of a 360-day
year/30-day month, cumulative for the period for which such 8% Return is being
determined.

                                    ARTICLE 2
                                   APPOINTMENT

        The Company hereby appoints the Advisor to serve as its advisor and
asset manager on the terms and conditions set forth in this Agreement, and the
Advisor hereby accepts such appointment.




                                       6
<PAGE>

                                    ARTICLE 3
                              DUTIES OF THE ADVISOR

        The Advisor shall consult with the Company and shall, at the request of
the Board of Directors or the officers of the General Partner, furnish advice
and recommendations with respect to all aspects of the business and affairs of
the Company. In general, the Advisor shall inform the Board of Directors of
factors that come to its attention which could influence the policies of the
Company. Subject to the supervision of the Board of Directors and consistent
with the provisions of the Articles of Incorporation and the Bylaws, the Advisor
shall, either directly or by engaging an Affiliate or third party, use its best
efforts to perform the following duties:

        3.1. Organization and Offering Services. The Advisor shall manage and
supervise:

               (a) Development of the product offering, including the
determination of the specific terms of the Securities to be offered pursuant to
the Offering by the Company;

               (b) Formation and organization of the Company, including
preparation of all offering and related documents, and the obtaining of all
required regulatory approvals of such documents;

               (c) Along with the Managing Dealer, approval of the participating
broker dealers and negotiation of the related selling agreements;

               (d) Coordination of the due diligence process relating to
participating broker dealers and their review of the Prospectus and other
Offering and Company documents;

               (e) Preparation and approval of all marketing materials
contemplated to be used by the Managing Dealer or others in the Offering of the
Company's Securities;

               (f) Along with the Managing Dealer, negotiation and coordination
with the transfer agent for the receipt, collection and processing of
subscription agreements, commissions, and other administrative support
functions;

               (g) Creation and implementation of various technology and
electronic communications related to the Offering of the Company's Securities;
and

               (h) All other services related to organization of the Company,
the Offering or any subsequent public offering of Shares, whether performed and
incurred by the Advisor or its Affiliates.

        3.2. Acquisition Services.

               (a) Serve as the Company's investment and financial advisor and
provide relevant market research and economic and statistical data in connection
with the Company's assets and investment objectives and policies;



                                       7
<PAGE>

               (b) Subject to Section 4 hereof and the investment objectives and
policies of the Company: (a) locate, analyze and select potential investments in
Assets; (b) structure and negotiate the terms and conditions of transactions
pursuant to which investments in Assets will be made; (c) acquire Assets on
behalf of the Company; and (d) arrange for financing and refinancing related to
potential acquisitions of Assets;

               (c) Perform due diligence on prospective investments and create
due diligence reports summarizing the results of such work;

               (d) Prepare reports regarding prospective investments which
include recommendations and supporting documentation necessary for the Directors
to evaluate the proposed investments;

               (e) Obtain reports (which may be prepared by the Advisor or its
Affiliates), where appropriate, concerning the value of contemplated investments
of the OP; and

               (f) Negotiate and execute approved investments and other
transactions.

        3.3. Asset Management Services.


               (a) Real Estate Services:

                      (i) Investigate, select, and, on behalf of the Company,
engage and conduct business with such Persons as the Advisor deems necessary to
the proper performance of its obligations hereunder, including but not limited
to appraisers, consultants, accountants, contractors, lenders, technical
advisors, attorneys, brokers, underwriters, broker-dealers, corporate
fiduciaries, escrow agents, depositaries, custodians, agents for collection,
insurers, insurance agents, developers, construction companies, leasing agents,
property managers and any and all Persons acting in any other capacity deemed by
the Advisor necessary or desirable for the performance of any of the services
set forth in this Article 3, including but not limited to entering into
contracts in the name of the General Partner or the OP with any of the
foregoing;

                      (ii) Negotiate on behalf of the Company with banks or
lenders and service the Company's debt facilities and other financings;

                      (iii) Monitor applicable markets and obtain reports (which
may be prepared by the Advisor or its Affiliates) where appropriate, concerning
the value of investments of the Company;

                      (iv) Monitor and evaluate the performance of investments
of the Company; provide daily management services to the Company and perform and
supervise the various management and operational functions related to the
Company's investments;

                      (v) Oversee the performance by any property managers
retained by the Company of their duties relating to major property transactions
and assist in obtaining all necessary approvals for such transactions;



                                       8
<PAGE>

                      (vi) Coordinate and manage relationships between the
Company and any joint venture partners;

                      (vii) Consult with the officers and Directors of the
General Partner and provide assistance with the evaluation and approval of
potential property dispositions, sales or refinancings;

               (b) Accounting and Other Administrative Services:

                      (i) Oversee and perform the various administrative
functions reasonably necessary for the management of the day-to-day operations
of the Company;

                      (ii) From time-to-time, or at any time reasonably
requested by the Directors, provide reports to the Directors on the Advisor's
performance of services for the Company under this Agreement;

                      (iii) Coordinate with the Company's independent
accountants and auditors to prepare and deliver to the General Partner's audit
committee an annual report covering the Advisor's material compliance with
aspects of this Advisory Agreement;

                      (iv) Provide or arrange for administrative services and
items, legal and other services, office space, office furnishings, personnel and
other overhead items necessary and incidental to the Company's business and
operations;

                      (v) Maintain accounting data and any other information
requested concerning the activities of the Company as shall be required to
prepare and to file all periodic financial reports and returns required to be
filed with the Securities and Exchange Commission and any other regulatory
agency, including annual financial statements;

                      (vi) Maintain and preserve all appropriate books and
records of the General Partner and the OP;

                      (vii) Provide tax and compliance services and coordinate
with appropriate third parties, including independent accountants and other
consultants, on related tax matters;

                      (viii) Supervise the performance of such ministerial and
administrative functions as may be necessary in connection with the daily
operations of the Assets;

                      (ix) Provide the Company with all necessary cash
management services;

                      (x) Manage and coordinate with the transfer agent the
dividend process and payments to shareholders;

                      (xi) Consult with the officers and Directors of the
General Partner and assist the Directors in evaluating and obtaining adequate
insurance coverage based upon risk management determinations;



                                       9
<PAGE>

                      (xii) Provide the officers and Directors of the General
Partner with timely updates related to the overall regulatory environment
affecting the Company, as well as managing compliance with such matters,
including but not limited to compliance with the Sarbanes-Oxley Act of 2002;

                      (xiii) Consult with the officers and Directors of the
General Partner and the Board of Directors relating to the corporate governance
structure and appropriate policies and procedures related thereto; and

                      (xiv) Perform all reporting, record keeping, internal
controls and similar matters in a manner to allow the Company to comply with
applicable law including, without limitation, the Sarbanes-Oxley Act.

        3.4. Shareholder Services.

               (a) Manage communications with Shareholders and holders of
limited partnership interests in the Company, including answering phone calls,
preparing and sending written and electronic reports and other communications;
and

               (b) Establish a technology infrastructure to assist in providing
shareholder support and service.

                                    ARTICLE 4
                              AUTHORITY OF ADVISOR

        4.1. General. Subject to the authority of the Board of Directors over
the management of the Company, all rights and powers to manage and control the
day-to-day business and affairs of the Company shall be vested in the Advisor.
The Advisor shall have the power to delegate all or any part of its rights and
powers to manage and control the business and affairs of the Company to such
officers, employees, Affiliates, agents and representatives of the Advisor or
the Company as it may from time to time deem appropriate. Any authority
delegated by the Advisor to any other Person shall be subject to the limitations
on the rights and powers of the Advisor specifically set forth in this Agreement
and the Articles of Incorporation.

        4.2. Powers of the Advisor. Subject to the express limitations set forth
in this Agreement, the power to direct the management, operation and policies of
the Company shall be vested in the Advisor, which shall have the power by itself
and shall be authorized and empowered on behalf and in the name of the Company
to carry out any and all of the objectives and purposes of the Company and to
perform all acts and enter into and perform all contracts and other undertakings
that it may in its sole discretion deem necessary, advisable or incidental
thereto to perform its obligations under this Agreement. The Advisor shall
present to the Company real estate investment opportunities consistent with the
Company's investment policies and objectives adopted by the Board of Directors
and in effect from time to time.

        4.3. Approval by Directors.

               (a) If this Agreement or the Articles of Incorporation require
that a transaction be approved by the Board of Directors or the Independent
Directors, the Advisor will deliver to



                                       10
<PAGE>

the Board of Directors or the Independent Directors, as applicable, all
documents required by them to properly evaluate the proposed transaction. The
prior approval of a majority of the Independent Directors will be required for
each transaction between the OP and the Advisor or its Affiliates.

               (b) The Advisor may acquire on behalf of the Company any real
property with a purchase price that does not require approval of the Board of
Directors, or finance (including any refinancing) such a property on the
Company's behalf, without the prior approval of the Board of Directors if and to
the extent that:

                      (i) the proposed acquisition or financing would not, if
consummated, violate or conflict with the investment guidelines of the Company
as set forth in the Prospectus;

                      (ii) the proposed acquisition or financing would not, if
consummated, violate the borrowing restrictions set forth in the Articles of
Incorporation; and

                      (iii) the consideration proposed to be paid for such real
property does not exceed the fair market value of such property, as determined
by a qualified independent real estate appraiser selected in good faith by the
Advisor.

               (c) The Board of Directors may, at any time upon the giving of
notice to the Advisor, modify or revoke the authority set forth in this
Section 4.

                                    ARTICLE 5
                                  BANK ACCOUNTS

        The Advisor may establish and maintain one or more bank accounts in the
name of the General Partner and the OP and may collect and deposit into any such
account or accounts, and disburse from any such account or accounts, any money
on behalf of the General Partner or the OP, as applicable, under such terms and
conditions as the Board of Directors may approve. Notwithstanding the foregoing,
no funds shall be commingled with the funds of the Advisor. The Advisor shall
from time to time, as the Company may require, render appropriate accounting of
such collections, deposits and disbursements to the Board of Directors and to
the auditors of the Company.

                                    ARTICLE 6
                        RECORDS AND FINANCIAL STATEMENTS

        The Advisor shall maintain appropriate and separate books and records of
its activities for the Company in accordance with United States generally
accepted accounting principles ("GAAP"), which shall be supported by sufficient
documentation to ascertain that such books and records are properly and
accurately recorded. Such books and records shall be the property of the Company
and shall be available for inspection by the Company and its counsel, auditors
and authorized agents at any time and from time to time during normal business
hours. Such books and records shall include all information necessary to
calculate and audit the fees or reimbursements paid under this Agreement. The
Advisor shall utilize procedures to attempt to ensure such control over
accounting and financial transactions as is reasonably required to protect the
Assets from theft, error or fraudulent activity. All financial statements the
Advisor



                                       11
<PAGE>

delivers to the Company shall be prepared on an accrual basis in accordance with
GAAP, except for special financial reports which by their nature require a
deviation from GAAP. The Advisor shall maintain necessary liaison with the
Company's independent accountants and shall provide such accountants with such
reports and other information as the Company shall reasonably request. The
Advisor shall at all reasonable times have access to the books and records of
the General Partner and the OP.

                                    ARTICLE 7
                            LIMITATION ON ACTIVITIES

        Notwithstanding any provision in this Agreement to the contrary, the
Advisor shall refrain from taking any action which, in its sole judgment made in
good faith, would (i) adversely affect the ability of the General Partner to
qualify or continue to qualify to be taxed as a REIT, (ii) subject the OP or the
General Partner to regulation under the Investment Company Act of 1940, as
amended, (iii) violate any law, rule or regulation of any governmental body or
agency having jurisdiction over the OP, the General Partner or the Securities of
the OP or General Partner, or (iv) violate the Articles of Incorporation, the
Bylaws or the OP Agreement except if such action shall be ordered by the Board
of Directors, in which case the Advisor shall notify the Board of Directors of
the Advisor's judgment of the potential impact of such action and shall refrain
from taking such action until it receives further clarification or instructions
from the Board of Directors. In such event the Advisor shall have no liability
for acting in accordance with the specific instructions of the Board of
Directors so given. Notwithstanding the foregoing, none of the Advisor, its
Affiliates and none of their respective directors, officers, members, managers,
employees and equityholders, shall be liable to the OP, the General Partner, the
Board of Directors or the Shareholders for any act or omission by such Persons
or individuals, except as provided in Article 16 of this Agreement.

                                    ARTICLE 8
                    RELATIONSHIP WITH DIRECTORS AND OFFICERS

        Directors, officers and employees of the Advisor or any direct or
indirect Affiliate of the Advisor may serve as a Director and/or officer of the
General Partner, except that no director, officer or employee of the Advisor or
any of its Affiliates who also is a Director or officer of the General Partner
shall receive any compensation from the OP or the General Partner for serving as
a Director or officer of the General Partner other than reasonable reimbursement
for travel and related expenses incurred in attending meetings of the Board of
Directors.

                                    ARTICLE 9
                                      FEES

        9.1. Acquisition Fees. The Company will pay the Advisor in cash as
compensation for services described in Section 3.2 an acquisition fee of 2.25%
of the Initial Asset Value of each Property acquired by the Advisor. The amount
of such acquisition fees shall be subject to any limitations contained in the
Articles of Incorporation. The Advisor shall submit an invoice to the Company
following the closing or closings of each acquisition, accompanied by a
computation of the fee. The fee shall be payable within 20 business days after
receipt of the invoice by the Company.



                                       12
<PAGE>

        9.2. Asset Management Fees. The Company will pay the Advisor in cash as
compensation for services described in Section 3.3 an asset management fee of
one-twelfth of 0.5% of the Total Asset Value of the Assets held by the Company
calculated on an annual basis. Subject to any limitations contained in the
Articles of Incorporation, this asset management fee shall be earned monthly.
The Advisor shall submit a monthly invoice to the Company, accompanied by a
computation of the asset management fee for the applicable period. The asset
management fee shall be payable within 20 business days after receipt of the
invoice by the Company.

        9.3. Loan Refinancing Fee. The Company will pay to the Advisor for all
qualifying loan refinancings of Properties a "Loan Refinancing Fee" in the
amount up to 0.5% of the principal amount of any refinancing loan secured by a
Property for which the Advisor renders services. A refinancing will qualify for
a Loan Refinancing Fee only if: (A) the new loan is approved by a majority of
the Board of Directors and found to be in the best interest of the Company, and
(B) the terms of the new loan represent an improvement over the terms of the
refinanced loan, the new loan materially increases the total debt secured by a
particular Property, or the maturity date of the refinanced loan (which must
have a term of five years or more) is less than one year from the date of the
refinancing. Any Loan Refinancing Fee shall be due and payable upon the funding
of the related mortgage loan or as soon thereafter as is reasonably practicable.

        9.4. Subordinated Real Estate Commission.

               (a) In connection with the Sale of one or more Properties, the
Company shall pay to the Advisor or such Affiliate a "Subordinated Real Estate
Commission" equal to the lesser of (A) one-half of a Competitive Real Estate
Commission, and (B) 2.0% of the proceeds of the Sale of such Property. The
Subordinated Real Estate Commission will be payable only if the following
condition (the "Subordination Condition") has been satisfied as of the date of
payment (or, for purposes of Sections 9.3(iii) and (iv), the Termination Date or
the Listing Date, respectively): the Shareholders must have received Dividends
in an amount equal to 100% of the Invested Capital plus their 8.0% Return. To
the extent that Subordinated Real Estate Commissions are not payable by the
Company at the time of the Sale of a Property because the Subordination
Condition has not been satisfied, any unpaid fees will be paid at such time as
the Subordination Condition has been satisfied. The Subordinated Real Estate
Commission may be paid in addition to real estate commissions paid to
non-Affiliates in connection with any Sale of a Property; provided that neither
the total real estate commissions received by the Advisor or its Affiliate nor
paid to all Persons by the Company shall exceed an amount equal to the lesser of
(X) the Competitive Real Estate Commission with respect to the Sale of such
Property, and (Y) 6.0% of the proceeds of the Sale of such Property.

               (b) Upon the termination of this Agreement, if any Subordinated
Real Estate Commissions have accrued but not been paid to the Advisor or any of
its Affiliates because the Subordination Condition has not been satisfied prior
to the Termination Date, an appraisal of the Assets then held by the Fund shall
be made. For purposes of determining whether the Shareholders have received
aggregate Dividends as of the Termination Date in an amount equal to 100% of the
Invested Capital plus their 8.0% Return, the Shareholders will be deemed to have
received, in addition to any Dividends paid to the Shareholders prior to the
Termination Date,



                                       13
<PAGE>

Dividends as of the Termination Date in an amount equal to (A) the Appraised
Value of the Assets then owned by the Company, less (B) the amount of any
indebtedness owed by the Company. If, based on the calculation set forth in this
Section 9.3(iii), the Subordination Condition has been satisfied as of the
Termination Date, then the Company shall pay promptly to the Advisor any accrued
but unpaid Subordinated Real Estate Commissions.

               (c) On the Listing Date, if any Subordinated Real Estate
Commissions have accrued but not been paid to the Advisor or any of its
Affiliates because the Subordination Condition has not been satisfied prior to
the Listing Date, then for purposes of determining whether the Shareholders have
received aggregate Dividends in an amount equal to 100% of the Invested Capital
plus their 8.0% Return, the Shareholders will be deemed to have received, in
addition to any Dividends paid to the Shareholders prior to the Listing Date,
Dividends as of the Listing Date in an amount equal to the product of (A) the
total number of Shares outstanding as of the date of the Listing and (B) the
average closing price of the Shares over a period of 30 days during which the
stock is traded, with such period beginning 180 days after Listing. If, based on
the calculation set forth in this Section 9.3(iv), the Subordination Condition
has been satisfied as of the Listing Date, then the Company, promptly following
the 30-day period described in this Section 9.3(iv), shall pay to the Advisor
any accrued but unpaid Subordinated Real Estate Commissions.

        9.5. Subordinated Share of Net Sales Proceeds(a). Upon the occurrence of
a Terminating Capital Transaction, if Listing has not occurred, the Advisor
shall be entitled to a Subordinated Share of Net Sales Proceeds in an amount
equal to 13.0% of Net Sales Proceeds remaining after the Shareholders have
received Distributions equal to the sum of the Shareholders' 8% Return and 100%
of Invested Capital. Following Listing, no Subordinated Share of Net Sales
Proceeds will be paid to the Advisor.

        9.6. Subordinated Incentive Listing Fee(a) . Upon Listing, the Advisor
shall be entitled to the Subordinated Incentive Listing Fee in an amount equal
to 13.0% of the amount by which (i) the market value of the outstanding Shares
of the Company, measured by taking the average closing price or average of bid
and asked price, as the case may be, over a period of 30 days during which the
Shares are traded, with such period beginning 180 days after Listing (the
"Market Value"), plus the total of all Dividends paid to Shareholders from the
Company's inception until the date that Market Value is determined, exceeds (ii)
the sum of (A) 100% of the Invested Capital and (B) the total Dividends required
to be paid to the Shareholders in order to pay their 8% Return from inception
through the date Market Value is determined. The Company shall have the option
to pay such fee in the form of cash, Shares, a promissory note or any
combination of the foregoing. The Subordinated Incentive Listing Fee will be
reduced by the amount of any prior payment to the Advisor of a Subordinated
Share of Net Sales Proceeds. In the event the Subordinated Incentive Listing Fee
is paid to the Advisor following Listing, no other performance or termination
fee will be paid to the Advisor.

        9.7. Termination Fee. Upon any termination or non-renewal of the
Advisory Agreement, if Listing has not occurred, the Advisor shall be entitled
to the Termination Fee in an amount equal to 13.0% of the amount by which (a)
the Appraised Value of all Assets less any indebtedness secured by such Assets
exceeds (b) the sum of 100% of Invested Capital and the total Dividends required
to be paid to the Shareholders in order to pay the Shareholders' 8%



                                       14
<PAGE>

Return. The Termination Fee will not be payable to the Advisor in the event the
Subordinated Incentive Listing Fee is paid. The Termination Fee will be reduced
by the amount of any prior payment to the Advisor of a Subordinated Share of Net
Sales Proceeds.

                                   ARTICLE 10
                                    EXPENSES

        10.1. General. Subject to Section 10.3 and in addition to the
compensation paid to the Advisor pursuant to Article 9 hereof, the Company shall
pay directly or reimburse the Advisor and its Affiliates for all of the expenses
paid or incurred by the Advisor or its Affiliates (to the extent not
reimbursable by another party, such as the dealer manager) in connection with
the services provided to the Company pursuant to this Agreement, including, but
not limited to:

               (a) all Organization and Offering Expenses; provided, however,
that the Company shall have no obligation to reimburse such expenses until the
"minimum offering" (as such term is described in the Prospectus) has been
reached and provided further that the Company shall at no time reimburse the
Advisor for any Organization and Offering Expenses reimbursements pursuant to
this Section 10 to the extent that such reimbursement would exceed 3.0% of Gross
Proceeds. The Advisor shall be responsible for the payment of all such
Organization and Offering Expenses in excess of 3.0% of Gross Proceeds and shall
reimburse the Company for any such excess within 60 days after the end of the
month in which the Offering terminates;

               (b) Acquisition Expenses incurred in connection with the
selection, evaluation and acquisition of Assets including such expenses incurred
related to assets pursued or considered but not ultimately acquired by the
Company;

               (c) the actual cost of goods and services used by the Company and
obtained from entities not affiliated with the Advisor, other than Acquisition
Expenses, including, but not limited to, brokerage fees paid in connection with
the purchase and sale of Securities;

               (d) taxes and assessments on income or Assets and taxes as an
expense of doing business and any other taxes otherwise imposed on the Company
and its business or income;

               (e) costs associated with insurance required in connection with
the business of the Company or by the Board of Directors;

               (f) all expenses in connection with payments to the Board of
Directors and meetings of the Board of Directors and Shareholders;

               (g) personnel and related employment direct costs and overhead of
the Advisor or Affiliates in performing the services described in Sections 3.1
and 3.4;

               (h) expenses of maintaining communications with Shareholders,
including the cost of preparation, printing, and mailing annual reports and
other Shareholder reports, proxy statements and other reports required by
governmental entities;



                                       15
<PAGE>

               (i) audit, accounting and legal fees, and other fees for
professional services relating to the operations of the Company and all such
fees incurred at the request, or on behalf of, the Independent Directors or any
committee of the Board of Directors;

               (j) costs for the Company to comply with all applicable laws,
regulation and ordinances; and

               (k) all other costs necessary for the operation of the Company
and its Assets incurred by the Advisor in performing its duties hereunder.

Except as specifically provided for above in (a) and (g) related to Organization
and Offering Expenses and shareholder services expenses, the expenses and
payments subject to reimbursement by the Company in this Section 10.1 do not
include personnel and related direct employment or overhead costs of the Advisor
or Affiliates. The Company shall also reimburse the Advisor or Affiliates of the
Advisor for all expenses incurred on behalf of the Company prior to the
execution of this Agreement.

        10.2. Reimbursement to Advisor. Expenses incurred by the Advisor on
behalf of the Company and payable pursuant to this Section 10 shall be
reimbursed no less than quarterly to the Advisor within 20 business days after
the Advisor provides the Company with an invoice and supporting documentation
relating to such reimbursement.

        10.3. Limitations on Reimbursement. The Company shall not reimburse the
Advisor during any fiscal quarter for Operating Expenses that, in the four
consecutive fiscal quarters then ended (the "Expense Year"), exceed the 2%/25%
Guidelines for such year (the "Excess Amount"), unless the Independent Directors
determine that such excess was justified, based on unusual and non-recurring
factors which they deem sufficient, in which case the Excess Amount may be
reimbursed. Any Excess Amount paid to the Advisor during a fiscal quarter
without the Independent Directors determining that such expenses were justified
shall be repaid to the Company within 20 business days after the end of such
fiscal quarter. Within 60 days after the end of any fiscal quarter of the
Company for which total Operating Expenses for the Expense Year exceed the
2%/25% Guidelines, there shall be sent to the Shareholders a written disclosure
of such fact, together with an explanation of the factors the Independent
Directors considered in determining that such excess expenses were justified, if
applicable. Any such determination and the reasons supporting such determination
shall be reflected in the minutes of the meetings of the Board of Directors. The
Company will not reimburse the Advisor or its Affiliates for services for which
the Advisor or its Affiliates are entitled to compensation in the form of a
separate fee.

                                   ARTICLE 11
                                 OTHER SERVICES

        Should the Company request that the Advisor or any director, officer or
employee thereof render services for the Company other than as set forth in
Article 3 of this Agreement or should there be changes to the regulatory
environment that would increase significantly the level of services performed
such that the personnel and related employment direct costs and overhead
expenses borne by the Advisor for which the Advisor is not entitled to separate
reimbursement under Article 10 of this Agreement would increase significantly,
such services shall be separately



                                       16
<PAGE>

compensated at such rates and in such amounts as are agreed by the Advisor and
the Independent Directors, subject to the limitations contained in the Articles
of Incorporation, and shall not be deemed to be services pursuant to the terms
of this Agreement.

                                   ARTICLE 12
                      RELATIONSHIP OF ADVISOR AND COMPANY;
                         OTHER ACTIVITIES OF THE ADVISOR

        12.1. Relationship. The Company and the Advisor are not partners or
joint venturers with each other, and nothing in this Agreement shall be
construed to make them such partners or joint venturers or impose any liability
as such on either of them.

        12.2. Other Activities. Nothing herein contained shall prevent the
Advisor or its Affiliates from engaging in other activities, including, without
limitation, the rendering of advice to other Persons (including other REITs) and
the management of other programs advised, sponsored or organized by the Advisor
or its Affiliates. Nor shall this Agreement limit or restrict the right of any
director, officer, manager, member, employee, or equityholder of the Advisor or
its Affiliates to engage in any other business or to render services of any kind
to any other Person. The Advisor may, with respect to any investment in which
the Company is a participant, also render advice and service to each and every
other participant therein. The Advisor shall promptly disclose to the Board of
Directors the existence of any condition or circumstance, existing or
anticipated, of which it has knowledge, which creates or could create a conflict
of interest between the Advisor's obligations to the Company and its obligations
to or its interest in any other Person.

        12.3. Time Commitment. The Advisor shall, and shall cause its Affiliates
and their respective employees, officers and agents to, devote to the Company
sufficient resources as shall be reasonably necessary to conduct the business
and affairs of the Company in a manner consistent with the terms of this
Agreement.

        12.4. Investment Opportunities and Allocation. The Advisor shall be
required to use commercially reasonable efforts to present a continuing and
suitable investment program to the Company which is consistent with the
investment policies and objectives of the Company, but neither the Advisor nor
any Affiliate of the Advisor shall be obligated generally to present any
particular investment opportunity to the Company even if the opportunity is of
such nature that, if presented to the Company, it could be taken by the Company.
Nothing in this Agreement shall prevent the Advisor and its Affiliates from
engaging in other activities, including, without limitation, the rendering of
advice to other Persons (including other REITs) and the management of other
programs advised, sponsored or organized by the Advisor or its Affiliates. This
Agreement shall not limit or restrict the right of any director, officer,
manager, member or employee of the Advisor or its Affiliates to engage in any
other business or to render services of any kind to any other Person. The
Advisor may, with respect to any investment in which the Company is a
participant, also render advice and service to each and every other participant
therein.


                                       17
<PAGE>

                                   ARTICLE 13
                                  THE SKB NAME

        SKB Advisors LLC and its Affiliates have a proprietary interest in the
name "SKB" and in the name "ScanlanKemperBard" (collectively, the "SKB Names").
SKB Advisors LLC hereby grants to the Company a non-transferable,
non-assignable, non-exclusive royalty-free right and license to use the SKB
Names during the term of this Agreement. Accordingly, and in recognition of this
right, if at any time the Company ceases to retain SKB Advisors LLC or an
Affiliate thereof to perform the services of Advisor, the Company will, promptly
after receipt of written request from SKB Advisors LLC, cease to conduct
business under or use the SKB Names or any derivative thereof and each of the
General Partner and the OP shall change their respective names to names that do
not contain the SKB Names or any other word or words that might, in the
reasonable discretion of SKB Advisors LLC, be susceptible of indication of some
form of relationship between the General Partner or the OP and SKB Advisors LLC
or any Affiliate thereof. At such time, the Company will also make any changes
to any trademarks, servicemarks or other marks necessary to remove any
references to the SKB Names. Consistent with the foregoing, it is specifically
recognized that SKB Advisors LLC or one or more of its Affiliates has in the
past and may in the future organize, sponsor or otherwise permit to exist other
investment vehicles (including vehicles for investment in real estate) and
financial and service organizations having the SKB Names as a part of their
name, all without the need for any consent (and without the right to object
thereto) by the General Partner or the OP.

                                   ARTICLE 14
                      TERM AND TERMINATION OF THE AGREEMENT

        14.1. Term. Unless earlier terminated in accordance with Section 14.2,
this Agreement shall have an initial term of one year from the date of the
Agreement. This Agreement may be renewed for an unlimited number of successive
one-year terms upon mutual consent of the parties. Any such renewal must be
approved by a majority of the Independent Directors. The General Partner
(through the Independent Directors) will evaluate the performance of the Advisor
annually before renewing the Agreement, and each such renewal shall be for a
term of no more than one year.

        14.2. Termination. This Agreement will automatically terminate upon
Listing or a Terminating Capital Transaction.

               (a) This Agreement may be terminated upon 60 days' written notice
without cause or penalty by any of the undersigned parties.

               (b) This Agreement may be terminated immediately by the General
Partner or the OP upon (a) any fraudulent conduct, criminal conduct, willful
misconduct or the negligent or willful breach of fiduciary duty of or by the
Advisor, (b) a material breach of this Agreement by the Advisor not cured within
10 business days after the Advisor receives written notice of such breach or (c)
the bankruptcy of the Advisor or commencement of any bankruptcy or similar
insolvency proceedings against the Advisor.



                                       18
<PAGE>

               (c) This Agreement may be terminated immediately by the Advisor
in the event of (a) any material breach of this Agreement by the Company not
cured by the Company within 10 business days after written notice thereof, or
(b) the bankruptcy of the OP or its General Partner or commencement of any
bankruptcy or similar insolvency proceedings of the OP or its General Partner.

        14.3. Payments on Termination and Survival of Certain Rights and
Obligations. Payments to the Advisor pursuant to this Section 14.5 shall be
subject to the 2%/25% Guidelines to the extent applicable.

               (a) The Advisor shall be entitled to receive from the Company
within 30 days after the Termination Date, reimbursements of all unpaid expenses
incurred and all earned but unpaid fees payable to the Advisor as of the
Termination Date including, without limitation, any fee under Section 9.6. After
the Termination Date, the Advisor shall not be entitled to compensation for
further services hereunder.

               (b) The Advisor shall promptly upon termination:

                      (i) pay over to the Company all money collected and held
for the account of the Company pursuant to this Agreement, if any, after
deducting any accrued compensation and reimbursement for its expenses to which
it is then entitled;

                      (ii) deliver to the Directors a full accounting, including
a statement showing all payments collected by it and a statement of all money
held by it, covering the period following the date of the last accounting
furnished to the Directors;

                      (iii) deliver to the Company all assets and documents of
the Company then in the custody of the Advisor, including, without limitation,
any electronic files or other intangible property, and thereafter promptly
destroy any copies or other reproductions of the same; and

                      (iv) cooperate with the Company to provide an orderly
transition of advisory functions.

        14.4. Survival. Upon the expiration or termination of this Agreement,
neither party shall have any further rights or obligations under this Agreement,
except that Articles 13, 16 and 18 shall survive the termination or expiration
of this Agreement.

        14.5. Redemption of OP Units. In the event this Agreement expires
without the consent of the Advisor, or is terminated for any reason other than
by the Advisor pursuant to Section 14.2, the Company shall, at the election of
the Advisor or its Affiliates (as applicable) and at any time after the
effective date of such expiration or termination, purchase all or a portion of
the Units (as such term is defined in the OP Agreement) held by the Advisor and
its Affiliates. The Company shall purchase such Units for cash, which shall be
payable within 120 days after the Advisor or its Affiliates (as applicable)
gives the Company written notice of its desire to sell all or a portion of the
Units held by such Person to the Company. The purchase price of each Unit shall
be the portion of the then-existing "Net Asset Value" (as such term is defined
in the OP Agreement) attributable to such Unit.



                                       19
<PAGE>

                                   ARTICLE 15
                                   ASSIGNMENT

        This Agreement may be assigned by the Advisor to an Affiliate with the
consent of the Company by approval of a majority of the Independent Directors.
The Advisor may assign any rights to receive fees or other payments under this
Agreement without obtaining the approval of the Company. This Agreement shall
not be assigned by the Company without the consent of the Advisor.

                                   ARTICLE 16
                   INDEMNIFICATION AND LIMITATION OF LIABILITY

        16.1. Indemnification by the Company. The Company shall indemnify and
hold harmless the Advisor and its Affiliates, including their respective
officers, directors, partners, members, managers, employees and equity holders,
from all liability, claims, damages or losses arising in the performance of
their duties hereunder, and related expenses, including reasonable attorneys'
fees, to the extent such liability, claims, damages or losses and related
expenses are not fully reimbursed by insurance, subject to any limitations
imposed by the laws of the State of Maryland, the Articles of Incorporation or
the OP Agreement, provided that: (i) the Advisor and its Affiliates have
determined that the course of conduct which caused the loss or liability was in
the best interests of the Company, (ii) the Advisor and its Affiliates were
acting on behalf of or performing services for the Company, and (iii) the
indemnified claim was not the result of bad faith, fraud, misconduct or
negligence of the indemnified person or resulted from a breach of the agreement
by the Advisor. Any indemnification of the Advisor may be made only out of the
net assets of the Company and not from the Shareholders.

        16.2. Indemnification by the Advisor. The Advisor shall indemnify and
hold harmless the Company and its officers, directors, partners, members,
managers, employees and equity holders from contract or other liability, claims,
damages, taxes or losses and related expenses, including attorneys' fees, to the
extent that such liability, claims, damages, taxes or losses and related
expenses are not fully reimbursed by insurance and are incurred by reason of the
Advisor's bad faith, fraud, willful misconduct, gross negligence or reckless
disregard of its duties, but the Advisor shall not be held responsible for any
action of the Board of Directors in following or declining to follow any of the
Advisor's advice or recommendations.

        16.3. Advisor's Liability.

               (a) Notwithstanding any other provisions of this Agreement, in no
event shall the OP or the General Partner make any claim against the Advisor, or
its Affiliates, on account of any good faith interpretation by the Advisor of
the provisions of this Agreement (even if such interpretation is later
determined to be a breach of this Agreement) or any alleged errors in judgment
made in good faith and in accordance with this Agreement in connection with the
operation of the Company hereunder by the Advisor or the performance of any
advisory or technical services provided by or arranged by the Advisor. The
provisions of this Section 16.3(i) shall not be deemed to release Advisor from
liability for its gross negligence.



                                       20
<PAGE>

               (b) The Company shall not object to any expenditures made by the
Advisor in good faith in the course of its performance of its obligations under
this Agreement or in settlement of any claim arising out of the operation of the
Company unless such expenditure is specifically prohibited by this Agreement.
The provisions of this Section 16.3(ii) shall not be deemed to release Advisor
from liability for its gross negligence.

               (c) IN NO EVENT WILL ANY PARTY TO THIS AGREEMENT BE LIABLE FOR
DAMAGES BASED ON THE LOSS OF INCOME, PROFIT OR SAVINGS OR INDIRECT, INCIDENTAL,
CONSEQUENTIAL, EXEMPLARY, PUNITIVE OR SPECIAL DAMAGES OF ANY OTHER PARTIES OR
PERSONS, INCLUDING THIRD PARTIES, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES IN ADVANCE, AND ALL SUCH DAMAGES ARE EXPRESSLY
DISCLAIMED. IN NO EVENT WILL ADVISOR'S AGGREGATE LIABILITY UNDER THIS AGREEMENT
EVER EXCEED THE TOTAL AMOUNT OF FEES IT ACTUALLY RECEIVES FROM THE COMPANY
PURSUANT TO ARTICLE 9.

                                   ARTICLE 17
                             COMPANY ADMINISTRATION

        The Advisor shall keep or cause to be kept complete and appropriate
records and books of account for the Company. Except as otherwise expressly
provided herein, such books and records shall be maintained on a basis which
allows the proper preparation of the Company's financial statements and tax
returns. The books and records shall be maintained at the principal office of
the Company.

                                   ARTICLE 18
                                  MISCELLANEOUS

        18.1. Notices. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is required by the Articles of
Incorporation, the Bylaws, or accepted by the party to whom it is given, and
shall be given by being delivered by hand or by overnight mail or other
overnight delivery service to the addresses set forth herein:

        To the General Partner, the OP or the Directors:

               c/o SKB REIT, Inc.
               1211 SW Fifth Avenue
               Suite 2250
               Portland, Oregon  97204



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<PAGE>

        To the Advisor:

               SKB Advisors LLC
               1211 SW Fifth Avenue
               Suite 2250
               Portland, Oregon 97204

        Either party may at any time give notice in writing to the other party
of a change in its address for the purposes of this Section 18.1.

        18.2. Modification. This Agreement shall not be changed, modified,
terminated, or discharged, in whole or in part, except by an instrument in
writing signed by both parties hereto, or their respective successors or
assignees.

        18.3. Severability. The provisions of this Agreement are independent of
and severable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.

        18.4. Construction. The provisions of this Agreement shall be construed
and interpreted in accordance with the laws of the State of Delaware without
regard to the principles of conflicts of law thereof.

        18.5. Entire Agreement. This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.

        18.6. Waiver. Neither the failure nor any delay on the part of a party
to exercise any right, remedy, power or privilege under this Agreement shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, remedy, power or privilege preclude any other or further exercise of the
same or of any other right, remedy, power or privilege, nor shall any waiver of
any right, remedy, power or privilege with respect to any occurrence be
construed as a waiver of such right, remedy, power or privilege with respect to
any other occurrence. No waiver shall be effective unless it is in writing and
is signed by the party asserted to have granted such waiver.

        18.7. Number and Gender. Words used herein regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.

        18.8. Titles Not to Affect Interpretation. The titles of Articles and
Sections contained in this Agreement are for convenience only, and they neither
form a part of this Agreement nor are they to be used in the construction or
interpretation hereof.



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<PAGE>

        18.9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument.











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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.



                                       SKB REIT, INC.


                                       By: _____________________________________
                                           Name:
                                           Title:


                                       SKB REIT OPERATING PARTNERSHIP, L.P.

                                       By:  SKB REIT, INC.
                                       Its: General Partner


                                       By: _____________________________________
                                           Name:
                                           Title:


                                       SKB ADVISORS, LLC


                                       By: _____________________________________
                                           Name:
                                           Title:



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