Exhibit 10.5


SECURED PROMISSORY NOTE


	$45,750,000.00	September 30, 2015







1.FOR VALUE RECEIVED, IRESI Frederick Market Square,
L.L.C., a Delaware limited liability company (“Borrower”), hereby promises to pay, to the order of PARKWAY
BANK AND TRUST COMPANY, an Illinois banking corporation (“Lender”), having a principal place of business and
post office address at 4800 N. Harlem Avenue, Harwood Heights, IL 60706, or at such other place as Lender may designate, the principal
sum of Forty-five mILLION seven hundred fifty Thousand and 00/100 Dollars ($45,750,000.00)
(the “Loan Amount”) or so much thereof as shall from time to time have been advanced, together with interest
on the unpaid balance of said sum from September 30, 2015 (the “Closing Date”), at the fixed rate of three
and 95/100ths percent (3.95%) per annum (the “Interest Rate”). Any amount payable hereunder which is not paid
when due shall, at Lender’s election, bear interest at a rate equal to the Interest Rate plus three percent (3%)
per annum (the “Default Rate”).


2(a)Interest
on this Secured Promissory Note (this “Note”) shall be calculated in arrears on the basis of a 360-day year
and the actual number of days elapsed in any portion of a month in which interest is due. Beginning on October 30, 2015, and continuing
on the last day of each successive month thereafter until the Maturity Date (as defined below), Borrower shall pay to Lender monthly
payments of interest only. All outstanding principal of and accrued and unpaid interest to and including the date of payment and
other Indebtedness shall be due and payable in full on September 30, 2016, or such earlier date resulting from the acceleration
of the Indebtedness by Lender (“Maturity Date”), subject to extension as set forth below. All principal and
interest shall be paid without setoff, counterclaim, or deduction of any kind, in lawful money of the United States of America
by automated clearinghouse transfer through such bank or financial institution as shall be approved in writing by Lender, shall
be made to an account designated by Lender, and shall be initiated by Lender or shall be made in such other manner as Lender may
direct from time to time. Any other monthly deposits or payments Borrower is required to make to Lender under the terms of the
Loan Documents (as defined in the Loan Agreement defined below) shall be made by the same payment method and on the same date
as the installments of interest due under this Note. This Note is the Note referred to in that certain Loan Agreement of even
date herewith (as amended form time to time the “Loan Agreement”), by and between Lender and Borrower. Capitalized
terms used and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement.




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(b)Provided no
Event of Default has occurred and is continuing and subject to the conditions contained herein, Borrower shall have a one-time
option to extend (the “Extension Option”) the Maturity Date for an additional seven (7) year period (i.e., from
September 30, 2016 to September 30, 2023) (the “Extension Period”) upon thirty (30) days’ prior written
notice to Lender. The Interest Rate during the Extension Period shall be the fixed per annum rate of three and 79/100ths percent
(3.79%). Borrower shall make payments of interest only during the first five (5) years of the Extension Period and thereafter shall
make payments of principal based on a 30-year amortization schedule, together with interest accrued at the Interest Rate in effect
during the Extension Period. Borrower’s exercise of the Extension Option shall be subject to (i) an appraisal of the Property
showing a loan-to-value ratio not to exceed 60% and (ii) Lender’s verification of a minimum debt coverage ratio of 2.45.
Borrower will execute and deliver to Lender any documents reasonably required by Lender to memorialize the exercise of such Extension
Option, including, without limitation, such documents re-making any representations and warranties by Borrower. Upon Borrower’s
exercise of the Extension Option, the Guaranty shall be null and void without any further action required by any of the parties.
All of the terms and conditions of the Loan Agreement, this Note, the Deed of Trust and all of the other Loan Documents, but not
including the Guaranty, shall be in full force and effect during the Extension Period.


3.Borrower may
prepay the principal of this Note in whole or part prior to the Maturity Date without premium or penalty in accordance with the
provisions of the Loan Agreement. Time is of the essence with respect to the payment of this Note.


4.If any payment
of principal, interest, or other Indebtedness is not made when due, damages will be incurred by Lender, including additional expense
in handling overdue payments, the amount of which is difficult and impractical to ascertain. Borrower therefore agrees to pay,
upon demand, to the extent permitted by law, the sum of five cents ($.05) for each one dollar ($1.00) of each said payment
that becomes overdue (“Late Charge”) as a reasonable estimate of the amount of said damages, subject, however,
to the limitations contained in Paragraph 5 hereof, and provided that no late charge shall be assessed for any payment due on or
after the Maturity Date.


Further, notwithstanding
the hereinabove or anything in the Loan Documents to the contrary, no Late Charge shall be incurred by or assessed against Borrower
with respect to amounts as to which interest at the Default Rate accrues.




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5.If any Event
of Default has occurred and is continuing under the Loan Documents, the entire principal balance of the Loan, interest then accrued,
and all other Indebtedness whether or not otherwise then due, shall, at Lender’s option, become immediately due and payable
without demand or notice, and whether or not Lender has exercised said option, interest shall accrue on the entire principal balance,
interest then accrued, and any other Indebtedness then due, at a rate equal to the Default Rate until fully paid. Notwithstanding
the foregoing, in the case of any Event of Default specified in Section 4.1(B) of the Loan Agreement with respect to the Borrower
or any guarantor, including the Guarantor, without any notice to Borrower or any other act by Lender, the entire principal balance
of the Loan, interest then accrued, and all other Indebtedness whether or not otherwise then due, shall become immediately and
automatically due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived
by Borrower, and Borrower will pay the same.


6.Borrower agrees
that Lender has all rights of set-off and bankers’ lien provided by applicable law, and, in addition thereto, Borrower agrees
that at any time any Event of Default exists, Lender may apply to the payment of any obligations of Borrower, whether or not then
due, any and all balances, credits, deposits, accounts or moneys of Borrower then or thereafter with Lender.


7.Notwithstanding
anything herein or in any of the other Loan Documents to the contrary, no provision contained herein or therein that purports to
obligate Borrower to pay any amount of interest or any fees, costs or expenses that are in excess of the maximum permitted by applicable
law shall be effective to the extent it calls for the payment of any interest or other amount in excess of such maximum. All agreements
between Borrower and Lender, whether now existing or hereafter arising and whether written or oral, are hereby limited so that
in no contingency, whether by reason of demand for payment or acceleration of the maturity hereof or otherwise, shall the interest
contracted for, charged or received by Lender exceed the maximum amount permissible under applicable law. If, from any circumstance
whatsoever, interest would otherwise be payable to Lender in excess of the maximum lawful amount, the interest payable to Lender
shall be reduced to the maximum amount permitted under applicable law; and if from any circumstance Lender shall ever receive anything
of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall,
at Lender’s option, be refunded to Borrower or be applied to the reduction of the principal hereof, and not to the payment
of interest or, if such excessive interest exceeds the unpaid balance of principal hereof such excess shall be refunded to Borrower.
This paragraph shall control all agreements between Borrower and Lender.




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8.Borrower and
any endorsers or guarantors waive presentment, protest and demand, notice of protest, demand and dishonor and nonpayment, and agree
the Maturity Date of this Note or any installment may be extended without affecting any liability hereunder, and further promise
to pay all reasonable costs and expenses, including but not limited to, reasonable attorney’s and paralegal’s fees
incurred by Lender in connection with any default or in any proceeding (whether incurred in any trial, appellate, bankruptcy, condemnation
or any other proceeding) to interpret and/or enforce any provision of the Loan Documents. No release of Borrower from liability
hereunder shall release any other maker, endorser or guarantor hereof.


9.This Note is
secured by the Loan Documents, including, without limitation, the instruments described on Schedule I attached to and made a part
of this Note. In no event shall such documents be construed inconsistently with the terms of this Note, and in the event of any
discrepancy between any such documents and this Note, the terms of this Note shall govern. The proceeds of this Note are to be
used for business, commercial, investment or other similar purposes, and no portion thereof will be used for any personal, family,
or household use. This Note shall be governed by and construed in accordance with the laws of the State of Illinois, without
regard to its conflict of law principles.


10.Except as
permitted pursuant to the Deed of Trust described in Schedule I, and as permitted by the Loan Agreement, any sale, conveyance or
transfer of any right, title or interest in the Premises or any portion thereof, or any other violation of any provisions of the
Loan Agreement or the Deed of Trust with respect to any transfers of the Premises without the prior written consent of Lender,
shall, at the option of Lender, constitute an Event of Default hereunder and upon any such Event of Default Lender may declare
the entire indebtedness evidenced by this Note to be immediately due and payable and foreclose the Deed of Trust securing this
Note immediately or at any time after such Event of Default occurs. The acceptance of any payment due hereunder after any sale,
transfer or assignment shall not be deemed as the consent of Lender to a sale, transfer or assignment.


11.If
this Note is executed by more than one party, all references herein to Borrower shall be deemed to each such party, individually
and collectively, and the obligations and liabilities of each Borrower under this Note shall be joint and several and shall be
binding upon and enforceable against each Borrower and their respective successors and assigns. This Note shall inure to the benefit
of and may be enforced by Lender and its successors and assigns.


12.This Note
may not be changed or terminated orally, but only by an agreement in writing and signed by both the Borrower and the Lender. All
of the rights, privileges, and obligations hereunder shall inure to the benefit of Lender’s successors, and assigns and shall
bind Borrower’s permitted successors and assigns.




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13.TO INDUCE
LENDER TO ACCEPT THIS NOTE, BORROWER IRREVOCABLY AGREES THAT, SUBJECT TO LENDER’S SOLE AND ABSOLUTE ELECTION, ALL ACTIONS
OR PROCEEDINGS IN ANY WAY ARISING OUT OF OR RELATED TO THIS NOTE WILL BE LITIGATED IN COURTS HAVING SITUS IN CHICAGO, ILLINOIS.
BORROWER HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY COURT LOCATED WITHIN CHICAGO, ILLINOIS, WAIVES PERSONAL SERVICE
OF PROCESS UPON BORROWER, AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED TO BORROWER AT THE
ADDRESS STATED IN THE DEED OF TRUST AND SERVICE SO MADE WILL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT.


14.The parties
hereto intend and believe that each provision of this Note comports with all applicable law. However, if any provision in this
Note is found by a court of law to be in violation of any applicable law, and if such court should declare such provision of this
Note to be unlawful, void or unenforceable as written, then it is the intent of all parties hereto that such provision shall be
given full force and effect to the fullest possible extent that it is legal, valid and enforceable, that the remainder of this
Note shall be construed as if such unlawful, void or unenforceable provision were not contained herein, and that the rights, obligations
and interests of Borrower and Lender under the remainder of this Note shall continue in full force and effect.


15.Borrower hereby
waives and renounces for itself, its legal representatives, and its successors and assigns, all rights to the benefits of any appraisement,
exemption and homestead now provided or that may hereafter be provided by the Constitution and laws of the United States of America
and of any state thereof to and in all its property, real and personal, against the enforcement and collection of the obligations
evidenced by this Note.


16.Borrower hereby
transfers, conveys and assigns to Lender a sufficient amount of such homestead or exemption as may be set apart in bankruptcy,
to pay this Note in full, with all costs of collection, and does hereby direct any trustee in bankruptcy having possession of such
homestead or exemption to deliver to Lender a sufficient amount of property or money set apart as exempt to pay the Indebtedness
evidenced hereby, or any renewal thereof, and does hereby appoint Lender the attorney-in-fact for Borrower to claim any and all
such homestead or exemptions allowed by law.




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17.AFTER CONSULTING
WITH COUNSEL AND CAREFUL CONSIDERATION, BORROWER AND LENDER (BY ITS ACCEPTANCE HEREOF) KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY
WAIVE THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION ARISING OUT OF THIS NOTE OR ANY OTHER
INSTRUMENT OR AGREEMENT BY WHICH THIS NOTE IS, OR MAY HEREAFTER BE, SECURED, OR OUT OF ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (ORAL OR WRITTEN), OR ACTIONS OF BORROWER OR LENDER. THIS WAIVER IS A MATERIAL INDUCEMENT TO LENDER'S ACCEPTANCE OF
THIS NOTE.


18.Lender may
at any time assign its rights in this Note and the Loan Documents, or any part thereof and transfer its rights in any or all of
the Collateral, and Lender thereafter shall be relieved from all liability with respect to such Collateral. In addition, Lender
may at any time sell one or more participations in the Note. Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Note to secure obligations of Lender, including any pledge or assignment to secure obligations
to a Federal Reserve Bank; provided that no such pledge or assignment of a security interest shall release Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for Lender as a party hereto. Except as otherwise permitted in
the Loan Documents, Borrower may not assign its interest in this Note, or any other agreement with Lender or any portion thereof,
either voluntarily or by operation of law, without the prior written consent of Lender.


19.The Loan is
a business loan which comes within the purview of Section 205/4, paragraph (1)(c) of Chapter 815 of the Illinois Compiled Statutes,
as amended. Borrower agrees that the Loan evidenced by this Note is an exempted transaction under the Truth In Lending Act, 15
U.S.C., §1601, et seq.


20.Lender hereby
notifies Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56, signed into law October
26, 2001) (the “Act”), and Lender’s policies and practices, Lender is required to obtain, verify and record
certain information and documentation that identifies Borrower, which information includes the name and address of Borrower and
such other information that will allow Lender to identify Borrower in accordance with the Act. In addition, Borrower shall (a)
ensure that no person who owns a controlling interest in or otherwise controls Borrower or any subsidiary of Borrower is or shall
be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the Office of Foreign
Assets Control (“OFAC”), the Department of the Treasury or included in any Executive Orders, (b) not use or
permit the use of the proceeds of the Loan to violate any of the foreign asset control regulations of OFAC or any enabling statute
or Executive Order relating thereto, and (c) comply, and cause any of its subsidiaries to comply, with all applicable Bank Secrecy
Act (“BSA”) laws and regulations, as amended.


[Remainder
of page intentionally blank; signatures follow]




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IN WITNESS WHEREOF,
Borrower has caused this Secured Promissory Note to be duly executed and delivered to Lender as of the date first set forth above.


 


	 	IRESI Frederick Market Square, L.L.C., 

a Delaware limited liability company
	 	 	 	 
	 	By:	
        Inland Residential Operating
        Partnership, L.P.,

        a Delaware limited partnership,
        its sole member

	 	 	 	 
	 	 	By:	
        Inland Residential Properties
        Trust,

        Inc., a Maryland corporation,
        

        its general partner

	 	 	 	 
	 	 	By:	/s/ David Z. Lichterman
	 	 	Name:	David Z. Lichterman
	 	 	Its:	Vice President, Treasurer & CAO


 




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SCHEDULE I


A.DEED OF TRUST:


Deed of Trust, Security Agreement,
Fixture Financing Statement and Assignment of Rents executed by IRESI Frederick Market Square, L.L.C.encumbering certain
real estate located at 300 Cormorant Place, Frederick, Maryland.


 


		B.	ASSIGNMENTS OF LEASES AND RENTS:



Assignment of Leases and Rents executed
by IRESI Frederick Market Square, L.L.C. encumbering certain real estate located at 300 Cormorant Place, Frederick, Maryland.


 


C.SECURITY AGREEMENT:


 


Security Agreement executed by IRESI
Frederick Market Square, L.L.C..


 


D.GUARANTY:


 


Guaranty executed by Inland Real Estate
Investment Corporation.