Exhibit 99(a)

| American      Mortgage Acceptance Company and SubsidiariesConsolidated      Financial Statements as of and for the Years EndedDecember      31, 2008, 2007 and 2006 |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                                 |   | Page   |
|----------------------------------------------------------------------------------------------------------------------|--------|--------|
| Financial Statements                                                                                                 |   |   |
|                                                                                                                 |   |   |
| Report      of Independent Registered Public Accounting Firm                                                         |   | 1      |
|                                                                                                                 |   |   |
| Consolidated      Balance Sheets as of December 31, 2008 and 2007                                                    |   | 2      |
|                                                                                                                 |   |   |
| Consolidated      Statements of Operations for the years ended December 31, 2008, 2007 and      2006                 |   | 3      |
|                                                                                                                 |   |   |
| Consolidated      Statements of Shareholders’ Equity for the years ended December 31, 2008,      2007 and 2006 |   | 4      |
|                                                                                                                 |   |   |
| Consolidated      Statements of Cash Flows for the years ended December 31, 2008, 2007 and      2006                 |   | 5      |
|                                                                                                                 |   |   |
| Notes      to Consolidated Financial Statements                                                                      |   | 7      |
|                                                                                                                 |   |   |

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|                                                                                                                                                                               | December      31, |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------|--------|
|                                                                                                                                                                               | 2008              |   | 2007 |   |
|  ASSETS                                                                                                                                                                       |              |   |   |   |   |   |
|  Cash      and cash equivalents                                                                                                                                               |              | $      | 93 |   |   | $ | 15,844 |   |
| Restricted      cash                                                                                                                                                               |              |   | 1,152 |   |   |   | 9,783 |   |
| Investments                                                                                                                                                                        |              |   |   |   |   |   |   |   |
| Mortgage      loans receivable, net (Note 4)                                                                                                                                       |              |   | 371,211 |   |   |   | 529,644 |   |
| Available-for-sale      investments, at fair value (Note 5):                                                                                                                       |              |   |   |   |   |   |   |   |
| CMBS                                                                                                                                                                               |              |   | 5,474 |   |   |   | 69,269 |   |
| Mortgage      revenue bonds                                                                                                                                                        |              |   | -- |   |   |   | 4,879 |   |
| Accounts      receivable (Note 6)                                                                                                                                                  |              |   | 2,082 |   |   |   | 30,066 |   |
| Deferred      charges and other assets, net (Note 7)                                                                                                                               |              |   | 6,126 |   |   |   | 6,914 |   |
|  Total      assets                                                                                                                                                            |              | $      | 386,138 |   |   | $ | 666,399 |   |
|  LIABILITIES      AND SHAREHOLDERS’ (DEFICIT) EQUITY                                                                                                                    |
|  Liabilities:                                                                                                                                                                 |              |   |   |   |   |   |   |   |
| CDO      notes payable (Note 11)                                                                                                                                                   |              | $      | 352,079 |   |   | $ | 362,000 |   |
| Repurchase      facilities (Note 12)                                                                                                                                               |              |   | -- |   |   |   | 136,385 |   |
| Line      of credit – related party (Note 13)                                                                                                                                |              |   | 79,877 |   |   |   | 77,685 |   |
| Preferred      shares of subsidiary (subject to mandatory repurchase) (Note      14)                                                                                               |              |   | 25,000 |   |   |   | 25,000 |   |
| Interest      rate derivatives (Note 15)                                                                                                                                           |              |   | 57,447 |   |   |   | 26,631 |   |
| Accounts      payable and accrued expenses (Note 16)                                                                                                                               |              |   | 1,363 |   |   |   | 16,293 |   |
| Due      to Advisor and affiliates (Note 20)                                                                                                                                       |              |   | 6,653 |   |   |   | 1,471 |   |
| Dividends      payable                                                                                                                                                             |              |   | -- |   |   |   | 308 |   |
|  Total      liabilities                                                                                                                                                       |              |   | 522,419 |   |   |   | 645,773 |   |
|                                                                                                                                                                               |              |   |   |   |   |   |   |   |
| Commitments      and contingencies (Note 22)                                                                                                                                       |              |   |   |   |   |   |   |   |
|                                                                                                                                                                               |              |   |   |   |   |   |   |   |
| Shareholders’      (deficit) equity (Note 17):                                                                                                                               |              |   |   |   |   |   |   |   |
| 7.25%      Series A Cumulative Convertible Preferred Shares, no par value; 680 shares      issued and outstanding in 2007                                                          |              |   | 15,905 |   |   |   | 15,905 |   |
| Shares      of beneficial interest; $0.10 par value; 25,000 shares authorized; 8,917      issued and 8,502 outstanding in 2008 and 8,848 issued and 8,433      outstanding in 2007 |              |   | 892 |   |   |   | 885 |   |
| Treasury      shares of beneficial interest at par; 415 shares in 2008 and      2007                                                                                               |              |   | (42 | ) |   | $ | (42 | ) |
| Additional      paid-in capital                                                                                                                                                    |              |   | 128,125 |   |   |   | 128,087 |   |
| Accumulated      deficit                                                                                                                                                           |              |   | (227,538 | ) |   |   | (104,956 | ) |
| Accumulated      other comprehensive loss                                                                                                                                          |              |   | (53,623 | ) |   |   | (19,253 | ) |
|  Total      shareholders’ (deficit) equity                                                                                                                              |              |   | (136,281 | ) |   |   | 20,626 |   |
|  Total      liabilities and shareholders’ (deficit) equity                                                                                                              |              | $      | 386,138 |   |   | $ | 666,399 |   |

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|                                                                                                                    |   | Years      Ended December 31, |     |
|-------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
|                                                                                                                    |   | 2008                          |     |   | 2007 |   |   | 2006 |   |
|  Revenues:                                                                                                         |   |                          |     |   |   |   |   |   |   |
| Interest      income                                                                                                    |   | $                             | 37,024   |   |   | $ | 58,965 |   |   | $ | 31,408 |   |
| Other      revenues                                                                                                     |   |                          | 38       |   |   |   | 1,144 |   |   |   | 286 |   |
| Total      revenues                                                                                                     |   |                          | 37,062   |   |   |   | 60,109 |   |   |   | 31,694 |   |
|  Expenses:                                                                                                         |   |                          |     |   |   |   |   |   |   |   |   |   |
| Interest      (Note 20)                                                                                                 |   |                          | 32,233   |   |   |   | 42,302 |   |   |   | 19,372 |   |
| Interest      – distributions to preferred shareholders of subsidiary (subject      to mandatory repurchase)      |   |                          | 2,005    |   |   |   | 2,216 |   |   |   | 2,241 |   |
| General      and administrative                                                                                         |   |                          | 1,768    |   |   |   | 4,232 |   |   |   | 3,490 |   |
| Fees      to Advisor (Note 20)                                                                                          |   |                          | 2,535    |   |   |   | 3,796 |   |   |   | 3,546 |   |
| Impairment      of investments (Note 9)                                                                                 |   |                          | 109,198  |   |   |   | 38,295 |   |   |   | 16,443 |   |
| Amortization      and other                                                                                             |   |                          | 1,471    |   |   |   | 981 |   |   |   | 160 |   |
| Total      expenses                                                                                                     |   |                          | 149,210  |   |   |   | 91,822 |   |   |   | 45,252 |   |
|  Other      income (loss):                                                                                         |   |                          |     |   |   |   |   |   |   |   |   |   |
| Change      in fair value and loss on termination of derivative instruments      (Note      15)                         |   |                          | (4,207   | ) |   |   | (11,581 | ) |   |   | (5,299 | ) |
| Equity      in earnings of ARCap (Note 9)                                                                               |   |                          | --       |   |   |   | -- |   |   |   | 3,000 |   |
| (Loss)      gain on sale or repayment of investments (Note 9)                                                           |   |                          | (5,188   | ) |   |   | (18,819 | ) |   |   | 18,289 |   |
|  Total      other (loss) income                                                                                    |   |                          | (9,395   | ) |   |   | (30,400 | ) |   |   | 15,990 |   |
|  (Loss)      income from continuing operations                                                                     |   |                          | (121,543 | ) |   |   | (62,113 | ) |   |   | 2,432 |   |
|  (Loss)      income from discontinued operations, including (loss) gain on sale of real      estate owned (Note 8) |   |                          | (731     | ) |   |   | 3,531 |   |   |   | 255 |   |
|  Net      (loss) income                                                                                            |   |                          | (122,274 | ) |   |   | (58,582 | ) |   |   | 2,687 |   |
|  7.25%      Convertible Preferred dividends                                                                        |   |                          | (308     | ) |   |   | (527 | ) |   |   | -- |   |
| 7.25%      Convertible Preferred dividends in arrears                                                                   |   |                          | (924     | ) |   |   | -- |   |   |   | -- |   |
|  Net      (loss) income available for common shareholders                                                          |   | $                             | (123,506 | ) |   | $ | (59,109 | ) |   | $ | 2,687 |   |
|  Earnings      per share (basic and diluted) (Note 19):                                                            |   |                          |     |   |   |   |   |   |   |   |   |   |
|  (Loss)      income from continuing operations                                                                     |   | $                             | (14.49   | ) |   | $ | (7.45 | ) |   | $ | 0.29 |   |
| (Loss)      income from discontinued operations                                                                         |   | $                             | (0.09    | ) |   | $ | 0.42 |   |   | $ | 0.03 |   |
|  Net      (loss) income                                                                                            |   | $                             | (14.58   | ) |   | $ | (7.03 | ) |   | $ | 0.32 |   |
|  Weighted      average shares outstanding:                                                                         |   |                          |     |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                   |   |                          | 8,471    |   |   |   | 8,404 |   |   |   | 8,323 |   |
| Diluted                                                                                                                 |   |                          | 8,471    |   |   |   | 8,404 |   |   |   | 8,330 |   |

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|                                                                                                |   | 7.25%      Series A Cumulative Convertible Preferred Shares |   | Shares      of Beneficial Interest |   | Treasury      Shares of Beneficial Interest |   |   |   |      |   |   |   |                                 |      | Accumulated      Other Comprehensive (Loss) Income |   |                     |   |
|-----------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------|--------|------------------------------------|--------|---------------------------------------------|--------|--------|--------|-----------|--------|--------|--------|--------------------------------------|-----------|----------------------------------------------------|--------|--------------------------|--------|
|                                                                                                |   | Shares                                                      |   | Amount                             |   | Shares                                      |   | Amount |   | Shares    |   | Amount |   | Additional      Paid-in      Capital |      | Share-Based      Compensation                      |   | Accumulated      Deficit |   | Comprehensive      Income (Loss) |   |   | Total |   |
|  Balance      at January 1, 2006                                                               |   | --                                                          |   | $                                  | --     |                                        | 8,719  |   | $      |  871 |   | (415   | )      | $                                    | (42       | )                                                  | $      |  126,357            |   | $ | (20 | ) | $ | (17,766 | ) |   |   |   | $ |  4,783 |   | $ | 114,183 |   |
|  Net      income                                                                               |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   | 2,687 |   | $ | 2,687 |   |   |   |   |   | 2,687 |   |
| Other      comprehensive income (loss):                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      unrealized loss on derivative instruments                                                  |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (3,642 | ) |   |   |   |   |   |   |
| Unrealized      holding loss on investments                                                         |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (6,993 | ) |   |   |   |   |   |   |
| Plus:      reclassification adjustments                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | 2,224 |   |   |   |   |   |   |   |
|  Total      other comprehensive loss                                                           |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (8,411 | ) |   | (8,411 | ) |   | (8,411 | ) |
|  Comprehensive      loss                                                                       |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   | $ |  (5,724 | ) |   |   |   |   |   |   |
| Reclassification      of unamortized share based compensation upon adoption of SFAS No.      123(R) |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   | (20                      | )      |   | 20 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options      exercised and other share based compensation                                           |   |                                                        |   |                               |   |                                        | 96     |   |   | 10        |   |   |   |                                 |      |                                               |   | 1,614                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 1,624 |   |
| Amortization      of share option costs                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   | 20                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 20 |   |
|  Dividends                                                                                     |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   | (25,095 | ) |   |   |   |   |   |   |   | (25,095 | ) |
|  Balance      at December 31, 2006                                                             |   | --                                                          |   |                               | --     |                                        | 8,815  |   |   | 881       |   | (415   | )      |                                 |  (42 | )                                                  |   | 127,971                  |   |   | -- |   |   |  (40,174 | ) |   |   |   |   |  (3,628 | ) |   | 85,008 |   |
|  Net      loss                                                                                 |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   | (58,582 | ) | $ | (58,582 | ) |   |   |   |   | (58,582 | ) |
| Other      comprehensive income (loss):                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      unrealized loss on derivative instruments                                                  |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (26,070 | ) |   |   |   |   |   |   |
| Unrealized      holding loss on investments                                                         |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (41,746 | ) |   |   |   |   |   |   |
| Plus:      reclassification adjustments                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | 52,191 |   |   |   |   |   |   |   |
|  Total      other comprehensive loss                                                           |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (15,625 | ) |   | (15,625 | ) |   | (15,625 | ) |
|  Comprehensive      loss                                                                       |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   | $ | (74,207 | ) |   |   |   |   |   |   |
| Options      exercised and other share based compensation                                           |   |                                                        |   |                               |   |                                        | 33     |   |   | 4         |   |   |   |                                 |      |                                               |   | 116                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 120 |   |
| Issuance      of preferred shares                                                                   |   | 680                                                         |   |                               | 15,905 |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 15,905 |   |
|  Dividends                                                                                     |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   | (6,200 | ) |   |   |   |   |   |   |   | (6,200 | ) |
|  Balance      at December 31, 2007                                                             |   | 680                                                         |   |                               | 15,905 |                                        | 8,848  |   |   | 885       |   | (415   | )      |                                 | (42       | )                                                  |   | 128,087                  |   |   | -- |   |   | (104,956 | ) |   |   |   |   | (19,253 | ) |   | 20,626 |   |
|  Net      loss                                                                                 |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   | (122,274 | ) | $ | (122,274 | ) |   |   |   |   | (122,274 | ) |
| Other      comprehensive income (loss):                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      unrealized loss on derivative instruments                                                  |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (35,726 | ) |   |   |   |   |   |   |
| Unrealized      holding loss on investments                                                         |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (46,730 | ) |   |   |   |   |   |   |
| Plus:      reclassification adjustments                                                             |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | 48,086 |   |   |   |   |   |   |   |
|  Total      other comprehensive loss                                                           |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   |   | (34,370 | ) |   | (34,370 | ) |   | (34,370 | ) |
|  Comprehensive      loss                                                                       |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   |   |   | $ | (156,644 | ) |   |   |   |   |   |   |
| Options      exercised and other share based compensation                                           |   |                                                        |   |                               |   |                                        | 69     |   |   | 7         |   |   |   |                                 |      |                                               |   | 38                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 45 |   |
|  Dividends                                                                                     |   |                                                        |   |                               |   |                                        |   |   |   |      |   |   |   |                                 |      |                                               |   |                     |   |   |   |   |   | (308 | ) |   |   |   |   |   |   |   | (308 | ) |
|  Balance      at December 31, 2008                                                             |   | 680                                                         |   | $                                  | 15,905 |                                        | 8,917  |   | $      | 892       |   | (415   | )      | $                                    | (42       | )                                                  | $      | 128,125                  |   | $ | -- |   | $ | (227,538 | ) |   |   |   | $ | (53,623 | ) | $ | (136,281 | ) |

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|                                                                                                     |   | Years      Ended December 31, |     |
|----------------------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
|                                                                                                     |   | 2008                          |     |   | 2007 |   |   | 2006 |   |
|  Cash      flows from operating activities:                                                         |   |                          |     |   |   |   |   |   |   |
| Net      (loss) income                                                                                   |   | $                             | (122,274 | ) |   | $ | (58,582 | ) |   | $ | 2,687 |   |
|  Adjustments      to reconcile net (loss) income to net cash provided by operating      activities: |   |                          |     |   |   |   |   |   |   |   |   |   |
| Impairment      of investments                                                                           |   |                          | 109,198  |   |   |   | 38,295 |   |   |   | 16,443 |   |
| Change      in fair value and loss on termination of derivative      instruments                         |   |                          | 4,207    |   |   |   | 11,581 |   |   |   | 5,299 |   |
| Amortization      and accretion                                                                          |   |                          | 565      |   |   |   | (58 | ) |   |   | (207 | ) |
| Other      non-cash (income) expense, net                                                                |   |                          | 56       |   |   |   | 930 |   |   |   | 1,142 |   |
| Depreciation      expense                                                                                |   |                          | --       |   |   |   | 336 |   |   |   | 1,671 |   |
| Bad      debt expense                                                                                    |   |                          | --       |   |   |   | (1,329 | ) |   |   | -- |   |
| Loss      (gain) on sale or repayment of investments                                                     |   |                          | 5,188    |   |   |   | 18,819 |   |   |   | (18,289 | ) |
| Equity      in earnings of investees                                                                     |   |                          | --       |   |   |   | -- |   |   |   | (3,000 | ) |
| Distributions      received from equity investments                                                      |   |                          | --       |   |   |   | -- |   |   |   | 4,037 |   |
| Loss      (gain) on sale of real estate owned                                                            |   |                          | 772      |   |   |   | (3,611 | ) |   |   | -- |   |
|                                                                                                     |   |                          |     |   |   |   |   |   |   |   |   |   |
| Changes      in operating assets and liabilities:                                                        |   |                          |     |   |   |   |   |   |   |   |   |   |
| Accounts      receivable                                                                                 |   |                          | 3,700    |   |   |   | 1,891 |   |   |   | (3,957 | ) |
| Other      assets                                                                                        |   |                          | (675     | ) |   |   | 13 |   |   |   | -- |   |
| Due      to Advisor and affiliates                                                                       |   |                          | 4,653    |   |   |   | (198 | ) |   |   | (1,291 | ) |
| Accounts      payable and accrued expenses                                                               |   |                          | (14,728  | ) |   |   | 2,287 |   |   |   | 3,584 |   |
|  Net      cash from operating activities                                                            |   |                          | (9,338   | ) |   |   | 10,374 |   |   |   | 8,119 |   |
|  Cash      flows from investing activities:                                                         |   |                          |     |   |   |   |   |   |   |   |   |   |
| Principal      repayments or sale of mortgage loans                                                      |   |                          | 94,824   |   |   |   | 256,083 |   |   |   | 11,490 |   |
| Funding      and purchase of mortgage loans                                                              |   |                          | (769     | ) |   |   | (253,266 | ) |   |   | (509,191 | ) |
| Investment      in CMBS                                                                                  |   |                          | --       |   |   |   | (123,052 | ) |   |   | -- |   |
| Principal      repayments or sale of CMBS                                                                |   |                          | 14,548   |   |   |   | 15,562 |   |   |   | -- |   |
| Investment      in CDO securities                                                                        |   |                          | --       |   |   |   | (10,061 | ) |   |   | -- |   |
| Principal      repayments or sale of CDO securities                                                      |   |                          | --       |   |   |   | 7,940 |   |   |   | -- |   |
| Principal      repayments or sale of debt securities                                                     |   |                          | --       |   |   |   | 81,182 |   |   |   | 131,813 |   |
| Prepayment      penalty from debt security refinancing                                                   |   |                          | --       |   |   |   | -- |   |   |   | 3,200 |   |
| Return      of capital and proceeds from the sale of ARCap                                               |   |                          | 495      |   |   |   | 337 |   |   |   | 37,181 |   |
| Decrease      (increase) in restricted cash                                                              |   |                          | 7,631    |   |   |   | 5,168 |   |   |   | (14,951 | ) |
| Decrease      (increase) in escrow receivables                                                           |   |                          | 25,284   |   |   |   | (24,287 | ) |   |   | -- |   |
| Proceeds      from sale of real estate owned                                                             |   |                          | 2,249    |   |   |   | 11,987 |   |   |   | 18,122 |   |
| Principal      repayment on real estate owned                                                            |   |                          | --       |   |   |   | 36 |   |   |   | -- |   |
| Principal      repayment of mortgage revenue bonds                                                       |   |                          | 2,224    |   |   |   | 181 |   |   |   | 1,651 |   |
|  Net      cash from investing activities                                                            |   |                          | 146,486  |   |   |   | (32,190 | ) |   |   | (320,685 | ) |
|                                                                                                     |   |                          |     |   |   |   |   |   |   | (continued      ) |   |

----

----

|                                                                                                                        |   | Years      Ended December 31, |     |
|-----------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
|                                                                                                                        |   | 2008                          |     |   | 2007 |   |   | 2006 |   |
|  Cash      flows from financing activities:                                                                            |   |                          |     |   |   |   |   |   |   |
| Proceeds      from repurchase facilities                                                                                    |   |                          | 695,441  |   |   |   | 1,044,314 |   |   |   | 432,881 |   |
| Repayments      of repurchase facilities and CDO notes payable                                                              |   |                          | (841,746 | ) |   |   | (1,071,505 | ) |   |   | (478,406 | ) |
| Proceeds      from line of credit – related party                                                                     |   |                          | 3,442    |   |   |   | 260,850 |   |   |   | 206,242 |   |
| Repayments      of line of credit – related party                                                                     |   |                          | (1,250   | ) |   |   | (198,165 | ) |   |   | (191,242 | ) |
| Proceeds      from CDO notes payable                                                                                        |   |                          | --       |   |   |   | -- |   |   |   | 362,000 |   |
| Interest      rate derivative termination costs                                                                             |   |                          | (8,170   | ) |   |   | -- |   |   |   | -- |   |
| Repayments      of warehouse facility                                                                                       |   |                          | --       |   |   |   | -- |   |   |   | (4,070 | ) |
| Deferred      financing costs                                                                                               |   |                          | --       |   |   |   | (280 | ) |   |   | (6,760 | ) |
| Dividends      paid to shareholders                                                                                         |   |                          | (616     | ) |   |   | (21,012 | ) |   |   | (13,297 | ) |
| Stock      options exercised                                                                                                |   |                          | --       |   |   |   | -- |   |   |   | 1,557 |   |
| Issuance      of preferred shares                                                                                           |   |                          | --       |   |   |   | 17,000 |   |   |   | -- |   |
| Equity      offering costs                                                                                                  |   |                          | --       |   |   |   | (1,095 | ) |   |   | -- |   |
|  Net      cash from financing activities                                                                               |   |                          | (152,899 | ) |   |   | 30,107 |   |   |   | 308,905 |   |
|  Net      (decrease) increase in cash and cash equivalents                                                             |   |                          | (15,751  | ) |   |   | 8,291 |   |   |   | (3,661 | ) |
|  Cash      and cash equivalents at the beginning of the year                                                           |   |                          | 15,844   |   |   |   | 7,553 |   |   |   | 11,214 |   |
|  Cash      and cash equivalents at the end of the year                                                                 |   | $                             | 93       |   |   | $ | 15,844 |   |   | $ | 7,553 |   |
|  Supplemental      information:                                                                                        |   |                          |     |   |   |   |   |   |   |   |   |   |
| Interest      paid (including distributions to preferred shareholders of subsidiary      (subject to mandatory repurchase)) |   | $                             | 42,993   |   |   | $ | 34,441 |   |   | $ | 19,399 |   |
| Non-cash      investing and financing activities:                                                                           |   |                          |     |   |   |   |   |   |   |   |   |   |
| Capitalized      interest income                                                                                            |   | $                             | 532      |   |   | $ | 520 |   |   | $ | 169 |   |

----

----

| ·   | Interest Income from Mortgage      Loans – We recognize interest on mortgage loans on the accrual      basis as it becomes due.  We amortize deferred loan origination      costs and fees on the interest method over the life of the applicable loan      as an adjustment to interest income.  Certain mortgage loans      contain provisions that allow us to participate in a percentage of the      underlying property’s excess cash flows from operations and excess      proceeds from a sale or refinancing.  We evaluate these loans in      accordance with EITF 86-21, Application of the AICPA      Notice to Practitioners regarding Acquisition, Development, and      Construction Arrangements to Acquisition of an Operating Property      to determine the classification of the investment as a loan.  This      income is recognized on the accrual basis as it becomes due.  We      place these assets on non-accrual status when collectability is not      assured.  If we consider a mortgage loan held for investment to      be impaired, we do not recognize any interest income after that      determination.  We apply any cash receipts of interest for      impaired mortgage loans held for investment to reduce the principal      balance of the loan. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interest Income on      Available-for-Sale Securities – We recognize interest on      available-for-sale securities on the accrual basis as it becomes      due.  Interest income also includes the amortization or      accretion of premiums and discounts arising at the purchase date, using      the effective yield method.  We place these assets on      non-accrual status when collectability is not  assured. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interest Income on Temporary      Investments – Interest income from temporary investments, such as      cash in banks and short-term instruments, is recognized on the accrual      basis as it becomes due. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Other      Revenues |
|--------------------|---------------------|

| ·   | Standby Loan Commitment      Fees – We receive fees for issuing standby loan      commitments.  If we do not expect to fund the commitment, we      recognize the fee ratably over the commitment period.  If we      determine that it is probable that a commitment will be exercised, we      defer the fee and, if the commitment is exercised, amortize it over the      life of the loan as an adjustment to interest income; if the commitment      expires unexercised, we recognize it upon  expiration. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Stabilization Guarantee and      Loan Administration Fees – We receive fees from borrowers for      guaranteeing construction loans made by third-party lenders for the period      between construction completion and funding of the permanent      loan.  We receive these fees in advance and amortize them over      the guarantee periods.  We also receive loan administration fees      on these guaranteed loans, on a monthly basis during the guarantee      period.  We recognize these fees when  due. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| ·   | Federal National Mortgage      Association (“FNMA”) Loan Guarantee Fees – We receive monthly loss      sharing/guarantee fees related to the FNMA loan program (see Note 22) and      recognize them when due. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Prepayment Fees – We may      receive fees from borrowers that repay loans earlier than their maturity      dates.  We recognize these fees as earned, unless a loan is      refinanced, in which case the prepayment fees may be deferred and      amortized over the life of the refinancedloan. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1. | Commercial      Mortgage Backed Securities (“CMBS”) |
|--------|----|-----------------------------------------------------------------|

|   | 2. | Revenue      Bonds |
|--------|----|--------------------|

|   | 3 | Debt      Securities |
|--------|---|----------------------|

|   | 4. | Impairment |
|--------|----|------------|

|   | 5. | Gain      or Loss on Sale |
|--------|----|---------------------------|

----

----

|   | (i) | the      present value of expected future cash flows discounted at the loans’      effective interest rate; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------|

|   | (ii) | the      loan’s observable market price; or |
|--------|------|---------------------------------------------------|

|   | (iii) | the      fair value of the collateral if the loan is      collateral-dependent. |
|--------|-------|---------------------------------------------------------------------------------|

----

----

----

----

| A. | Market      Conditions |
|----|------------------------|

----

----

| B. | Credit      Facilities |
|----|------------------------|

| C. | Asset      Sales/Repayments and Impairments |
|----|---------------------------------------------|

| D. | Dividend      Deferral |
|----|------------------------|

----

----

| E. | Financial      Statement Presentation – LiquidationBasis |
|----|----------------------------------------------------------------|

|                                                                  |   | As      ReportedDecember      31,2008 |    | Net      RealizableValueAdjustments |        | As      AdjustedDecember      31,2008 |        |
|-----------------------------------------------------------------------|--------|---------------------------------------|---------|-------------------------------------|-------------|---------------------------------------|-------------|
|                                                                  |   |                                  |    |                                | (Unaudited) |                                  | (Unaudited) |   |
| ASSETS                                                                |   |                                  |    |                                |        |                                  |        |   |   |   |
| Cash      and cash equivalents                                        |   | $                                     | 93      |                                | $           | --                                    |        | $ | 93 |   |
| Restricted      cash                                                  |   |                                  | 1,152   |                                |        | (259                                  | )(a)        |   | 893 |   |
| Investments:                                                          |   |                                  |    |                                |        |                                  |        |   |   |   |
| Mortgage      loans receivable, net                                   |   |                                  | 371,211 |                                |        | (365,993                              | )(a)        |   | 3,433 |   |
|                                                                  |   |                                  |    |                                |        | (1,785                                | )(b)        |   |   |   |
| Available-for-sale      investments, at fair value:                   |   |                                  |    |                                |        |                                  |        |   |   |   |
| CMBS                                                                  |   |                                  | 5,474   |                                |        | (3,025                                | )(c)        |   | 2,449 |   |
| Accounts      receivable                                              |   |                                  | 2,082   |                                |        | --                                    |        |   | 2,082 |   |
| Deferred      charges and other assets, net                           |   |                                  | 6,126   |                                |        | (6,019                                | )(d)        |   | 107 |   |
| Total      Assets                                                     |   | $                                     | 386,138 |                                | $           | (377,080                              | )           | $ | 9,058 |   |
| LIABILITIES                                                           |   |                                  |    |                                |        |                                  |        |   |   |   |
| Liabilities:                                                          |   |                                  |    |                                |        |                                  |        |   |   |   |
| CDO      notes payable                                                |   | $                                     | 352,079 |                                | $           | (352,079                              | )(a)        | $ | -- |   |
| Line      of credit-related party                                     |   |                                  | 79,877  |                                |        | --                                    |        |   | 79,877 |   |
| Preferred      shares of subsidiary (subject to mandatory repurchase) |   |                                  | 25,000  |                                |        | --                                    |        |   | 25,000 |   |
| Interest      rate derivatives                                        |   |                                  | 57,447  |                                |        | (57,447                               | )(a)        |   | -- |   |
| Accounts      payable and accrued expenses                            |   |                                  | 1,363   |                                |        | --                                    |        |   | 1,363 |   |
| Due      to Advisor and affiliates                                    |   |                                  | 6,653   |                                |        | --                                    |        |   | 6,653 |   |
| Total      Liabilities                                                |   | $                                     | 522,419 |                                | $           | (409,526                              | )           |   | 112,893 |   |
| Net      Liabilities in Liquidation                                   |   |                                  |    |                                |        |                                  |        | $ | 103,835 |   |

| (a) | To      reflect assets and liabilities of CDO subsidiary at the zero liquidation      value of the Company’s equity in that subsidiary due to impairments within      the CDO causing hyper-amortization of certain classes of the Series I CRE      notes. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | To      record additional valuation allowance reflecting current liquidation      values, based on management currentestimates. |
|-----|---------------------------------------------------------------------------------------------------------------------------------|

| (c) | To      record additional impairment reflecting current liquidation values, based      on management current estimates. |
|-----|-------------------------------------------------------------------------------------------------------------------------|

| (d) | To      write off unamortized deferred financing costs associated with the      CDO. |
|-----|--------------------------------------------------------------------------------------|

----

----

| ·   | Level      1 inputs utilize quoted prices (unadjusted) in active markets for      identical assets or liabilities that we have the ability to      access. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      2 inputs utilize other-than-quoted prices that are observable for the      asset or liability, either directly or  indirectly. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      3 inputs are unobservable and are typically based on our own assumptions,      including situations where there is little, if any, market      activity. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (dollars      in thousands)                                                                                                                                                                                    |   | Level      1 |   |   | Level      2 |   |   | Level      3 |   |   | Balanceas      ofDecember      31,2008 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------|--------|--------------|--------|--------|--------------|--------|--------|----------------------------------------|--------|
|  Measured on a recurring    basis                                                                                                                                                                         |   |         |   |   |         |   |   |         |   |   |                                   |   |
|  Assets                                                                                                                                                                                                   |   |         |   |   |         |   |   |         |   |   |                                   |   |
| Available-for-sale      investments:                                                                                                                                                                           |   |         |   |   |         |   |   |         |   |   |                                   |   |
| CMBS                                                                                                                                                                                                           |   | $            | --     |   |         | $      | --     |         |   | $      | 5,474                                  |   |   | $ | 5,474 |   |
| Total      assets                                                                                                                                                                                              |   | $            | --     |   |         | $      | --     |         |   | $      | 5,474                                  |   |   | $ | 5,474 |   |
|                                                                                                                                                                                                           |   |         |   |   |         |   |   |         |   |   |                                   |   |   |   |   |   |
| Liabilities                                                                                                                                                                                                    |   |         |   |   |         |   |   |         |   |   |                                   |   |   |   |   |   |
| Interest      rate derivatives                                                                                                                                                                                 |   | $            | --     |   |         | $      | 57,447 |         |   | $      | --                                     |   |   | $ | 57,447 |   |
| Total      liabilities                                                                                                                                                                                         |   | $            | --     |   |         | $      | 57,447 |         |   | $      | --                                     |   |   | $ | 57,447 |   |
|  Measured on a non-recurring      basis                                                                                                                                                                   |   |         |   |   |         |   |   |         |   |   |                                   |   |   |   |   |   |
|  Assets                                                                                                                                                                                                   |   |         |   |   |         |   |   |         |   |   |                                   |   |   |   |   |   |
| Mortgage      loans receivable – held-for-investment-impaired(1)                                                                                                                                         |   | $            | --     |   |         | $      | 2,822  |         |   | $      | --                                     |   |   | $ | 2,822 |   |
| Total      assets                                                                                                                                                                                              |   | $            | --     |   |         | $      | 2,822  |         |   | $      | --                                     |   |   | $ | 2,822 |   |
|  (1)        We recorded $55.3 million of impairment charges for six loans in      this group during 2008, as described in Note 9. No other loans had      further impairments during 2008. |   |

----

----

|                                                                                                                                                                                                                                         |   | Fair      Value Measurements Using Significant Unobservable      Inputs (Level 3) |    |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------|---------|
| (dollars      in thousands)                                                                                                                                                                                                                  |   | CMBS                                                                              |    | MortgageRevenueBonds |   | Total |   |
|                                                                                                                                                                                                                                         |   |                                                                              |    |   |   |   |   |   |   |   |
| Balance      at January 1, 2008                                                                                                                                                                                                              |   | $                                                                                 | 69,269  |   | $ | 4,879 |   | $ | 74,148 |   |
| Total      gains or losses (realized/unrealized):                                                                                                                                                                                            |   |                                                                              |    |   |   |   |   |   |   |   |
| Included      in earnings                                                                                                                                                                                                                    |   |                                                                              | (49,730 | )(1) |   | (2,433 | )(2) |   | (52,163 | ) |
| Included      in other comprehensive income                                                                                                                                                                                                  |   |                                                                              | --      |   |   | 211 |   |   | 211 |   |
| Amortization      of costs and fees                                                                                                                                                                                                          |   |                                                                              | 484     |   |   | (184 | ) |   | 300 |   |
| Purchases,      issuances, settlements and sales                                                                                                                                                                                             |   |                                                                              | (14,549 | ) |   | (2,473 | ) |   | (17,022 | ) |
| Transfers      in and/out of Level 3                                                                                                                                                                                                         |   |                                                                              | --      |   |   | -- |   |   | -- |   |
|  Balance      at December 31, 2008                                                                                                                                                                                                      |   |                                                                              | 5,474   |   |   | -- |   |   | 5,474 |   |
|  The      amount of total losses for the period included in earnings attributable to      the change in unrealized losses relating to assets still held at the      reporting      date                                                 |   | $                                                                                 | (9,894  | )(2) | $ | -- |   | $ | (9,894 | ) |
|  (1)  Includes      $44.1 million recorded in “Impairment of investments” in the consolidated      statement of operations and $5.6 million recorded in “(Gain) loss on      repayment or sale of assets”. |   |
| (2)  Included      in “Impairment of investments” in the consolidated statement of      operations.                                                                                                                         |   |

|                                          |   | 2008   |    |   | 2007   |   |
|-----------------------------------------------|--------|--------|---------|--------|--------|--------|
|  Mortgage      loans held for investment |   | $      | 371,211 |   |   | $      | 467,734 |   |
| Mortgage      loans held for sale             |   |   | --      |   |   |   | 61,910 |   |
| Total                                         |   | $      | 371,211 |   |   | $      | 529,644 |   |

----

----

| Property                                                              |   | Description    |   | FinalMaturityDate |   | Call      Date (A) |   | Interest      Rate |   | PeriodicPayment      Terms |   | Prior      Liens |   | OutstandingFace      Amount of Mortgages (B) |   | Valuation      Allowance |   | UnamortizedCosts      and Fees |   | Carrying      Amount      of Mortgages      (C) |   | Interest      Income in 2008 |   |
|-----------------------------------------------------------------------|--------|----------------|--------|-------------------|--------|--------------------|--------|--------------------|--------|----------------------------|--------|------------------|--------|----------------------------------------------|--------|--------------------------|--------|--------------------------------|--------|-------------------------------------------------|--------|------------------------------|--------|
|  Mortgage Loans Receivable, Net – Held for      Investment |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |
|  First      Mortgage Loans:                                      |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| The      Victor (D)(E)                                                |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Camden,      NJ                                                       |   | Mixed      Use |   | 12                | /14    |               | 12     | /14                |   | 6.17                       | %      |             | (H)    |                                         | $      | --                       |   | $                              | 30,942 |                                            | $      | --                           |   | $ |  (552 | ) | $ | 30,390 |   | $ | 1,944 |   |
| Washington      Heights (D)(E)                                        |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Worcester,      MA                                                    |   | Multifamily    |   | 5                 | /16    |               | 12     | /15                |   | 6.85                       | %      |             | (H)    |                                         |   | --                       |   |                           | 26,860 |                                            |   | --                           |   |   | -- |   |   | 26,860 |   |   | 1,879 |   |
| Robert      Plan (D)                                                  |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Bethpage,      NY                                                     |   | Office         |   | 4                 | /16    |               | 04     | /16                |   | 6.77                       | %      |             | (G)    |                                         |   | --                       |   |                           | 20,000 |                                            |   | --                           |   |   | -- |   |   | 20,000 |   |   | 1,377 |   |
| Sage      at Cupertino (D)(E)                                         |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Cupertino,      CA                                                    |   | Multifamily    |   | 5                 | /16    |               | 05     | /16                |   | 5.99                       | %      |             | (G)    |                                         |   | --                       |   |                           | 22,000 |                                            |   | --                           |   |   | -- |   |   | 22,000 |   |   | 1,341 |   |
| The      Pines (D)                                                    |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Las      Vegas, NV                                                    |   | Multifamily    |   | 5                 | /16    |               | 11     | /15                |   | 5.84                       | %      |             | (F)    |                                         |   | --                       |   |                           | 13,000 |                                            |   | --                           |   |   | -- |   |   | 13,000 |   |   | 772 |   |
| Forest      Pointe (D)                                                |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Lake      Bluff, IL                                                   |   | Multifamily    |   | 6                 | /11    |               | 12     | /07                |   | 5.92                       | %      |             | (F)    |                                         |   | --                       |   |                           | 11,000 |                                            |   | --                           |   |   | -- |   |   | 11,000 |   |   | 662 |   |
| Harbour      Pointe (D)                                               |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Mukilteo,      WA                                                     |   | Retail         |   | 6                 | /11    |               | 12     | /07                |   | 5.92                       | %      |             | (F)    |                                         |   | --                       |   |                           | 11,000 |                                            |   | --                           |   |   | -- |   |   | 11,000 |   |   | 662 |   |
| 1800      Walt Whitman (D)                                            |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Melville,      NY                                                     |   | Office         |   | 6                 | /16    |               | 06     | /16                |   | 6.24                       | %      |             | (G)    |                                         |   | --                       |   |                           | 7,000  |                                            |   | --                           |   |   | -- |   |   | 7,000 |   |   | 444 |   |
| Ellington      Plaza (D)                                              |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Washington,      DC                                                   |   | Multifamily    |   | 9                 | /16    |               | 09     | /09                |   | 5.82                       | %      |             | (G)    |                                         |   | --                       |   |                           | 13,500 |                                            |   | --                           |   |   | (1,036 | ) |   | 12,464 |   |   | 783 |   |
| Stone      Cliff Heights (D)                                          |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Aurora,      CO                                                       |   | Multifamily    |   | 8                 | /16    |               | 02     | /16                |   | 6.08                       | %      |             | (F)    |                                         |   | --                       |   |                           | 26,500 |                                            |   | --                           |   |   | -- |   |   | 26,500 |   |   | 1,605 |   |
| Citrus      Grove (D)                                                 |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Elk      Grove, CA                                                    |   | Multifamily    |   | 9                 | /16    |               | 03     | /16                |   | 6.01                       | %      |             | (G)    |                                         |   | --                       |   |                           | 21,000 |                                            |   | --                           |   |   | -- |   |   | 21,000 |   |   | 1,258 |   |
| Courtyard      Apartments (D)                                         |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Albuquerque,      NM                                                  |   | Multifamily    |   | 8                 | /11    |               | 08     | /09                |   | 5.93                       | %      |             | (H)    |                                         |   | --                       |   |                           | 8,476  |                                            |   | --                           |   |   | -- |   |   | 8,476 |   |   | 512 |   |
| The      Crossroads at Chapel Hills (D)                               |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Colorado      Springs, CO                                             |   | Multifamily    |   | 9                 | /16    |               | 03     | /16                |   | 6.05                       | %      |             | (F)    |                                         |   | --                       |   |                           | 8,050  |                                            |   | --                           |   |   | -- |   |   | 8,050 |   |   | 495 |   |
| Arbors      Apartments (D)                                            |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Albuquerque,      NM                                                  |   | Multifamily    |   | 8                 | /11    |               | 10     | /09                |   | 5.93                       | %      |             | (H)    |                                         |   | --                       |   |                           | 7,478  |                                            |   | --                           |   |   | -- |   |   | 7,478 |   |   | 452 |   |
| Westpointe      Apartments (D)                                        |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Stockton,      CA                                                     |   | Multifamily    |   | 9                 | /13    |               | 02     | /16                |   | 6.28                       | %      |             | (F)    |                                         |   | --                       |   |                           | 6,500  |                                            |   | --                           |   |   | -- |   |   | 6,500 |   |   | 415 |   |
| Islip      Terrace (D)                                                |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Islip      Terrace, NY                                                |   | Retail         |   | 8                 | /11    |               | 07     | /09                |   | 6.12                       | %      |             | (H)    |                                         |   | --                       |   |                           | 5,839  |                                            |   | --                           |   |   | -- |   |   | 5,839 |   |   | 365 |   |
| 236      W. 16th Street (D)                                           |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| New      York, NY                                                     |   | Multifamily    |   | 9                 | /16    |               | 09     | /09                |   | 6.13                       | %      |             | (G)    |                                         |   | --                       |   |                           | 5,348  |                                            |   | --                           |   |   | -- |   |   | 5,348 |   |   | 333 |   |
| 253      Elizabeth Street (D)                                         |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| New      York, NY                                                     |   | Multifamily    |   | 9                 | /16    |               | 09     | /09                |   | 6.13                       | %      |             | (G)    |                                         |   | --                       |   |                           | 5,236  |                                            |   | --                           |   |   | -- |   |   | 5,236 |   |   | 326 |   |
| 515      E. 5th Street (D)                                            |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| New      York, NY                                                     |   | Multifamily    |   | 9                 | /16    |               | 09     | /09                |   | 6.13                       | %      |             | (G)    |                                         |   | --                       |   |                           | 3,416  |                                            |   | --                           |   |   | -- |   |   | 3,416 |   |   | 213 |   |
| Valley      Village  (D)                                    |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                         |   |                     |   |                           |   |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Bakersfield,      CA                                                  |   | Retail         |   | 9                 | /16    |               | 03     | /16                |   | 5.78                       | %      |             | (H)    |                                         |   | --                       |   |                           | 2,910  |                                            |   | --                           |   |   | -- |   |   | 2,910 |   |   | 169 |   |

----

----

| Property                           |   | Description    |   | FinalMaturityDate |   | Call      Date (A) |   | Interest      Rate |   | PeriodicPayment      Terms |       | Prior      Liens |   | OutstandingFace      Amount of Mortgages (B) |   | Valuation      Allowance |   | UnamortizedCosts      and Fees |    | Carrying      Amount      of Mortgages      (C) |   | Interest      Income in 2008 |   |
|------------------------------------|--------|----------------|--------|-------------------|--------|--------------------|--------|--------------------|--------|----------------------------|------------|------------------|--------|----------------------------------------------|--------|--------------------------|--------|--------------------------------|---------|-------------------------------------------------|--------|------------------------------|--------|
|  Rite      Aid (D)            |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Arroyo      Grande, CA             |   | Retail         |   | 10                | /16    |               | 04     | /16                |   | 5.57                       | %          |             | (H)    |                                         |   | --                       |   |                           | 2,426   |                                            |   | --                           |   |   | -- |   |   | 2,426 |   |   | 135 |   |
| Garden      Lakes (D)              |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Phoenix,      AZ                   |   | Office         |   | 10                | /16    |               | 07     | /16                |   | 6.06                       | %          |             | (F)    |                                         |   | --                       |   |                           | 2,300   |                                            |   | --                           |   |   | -- |   |   | 2,300 |   |   | 142 |   |
| Highland      Square II (D)        |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Greenville,      SC                |   | Multifamily    |   | 10                | /16    |               | 10     | /09                |   | 6.04                       | %          |             | (F)    |                                         |   | --                       |   |                           | 4,700   |                                            |   | --                           |   |   | -- |   |   | 4,700 |   |   | 288 |   |
| Wasilla      Portfolio (D)         |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Wasilla,      AK                   |   | Multifamily    |   | 7                 | /16    |               | 12     | /15                |   | 6.05                       | %          |             | (H)    |                                         |   | --                       |   |                           | 8,941   |                                            |   | --                           |   |   | -- |   |   | 8,941 |   |   | 554 |   |
| Manhattan      Beach (D)           |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Manhattan      Beach, CA           |   | Other          |   | 11                | /16    |               | 05     | /16                |   | 6.22                       | %          |             | (H)    |                                         |   | --                       |   |                           | 1,533   |                                            |   | --                           |   |   | -- |   |   | 1,533 |   |   | 98 |   |
| Alvin      Center (D)              |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| San      Jose, CA                  |   | Office         |   | 11                | /16    |               | 05     | /16                |   | 5.79                       | %          |             | (H)    |                                         |   | --                       |   |                           | 2,774   |                                            |   | --                           |   |   | -- |   |   | 2,774 |   |   | 165 |   |
| Davidson      Building (D)         |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Fife,      WA                      |   | Office         |   | 11                | /16    |               | 05     | /16                |   | 6.26                       | %          |             | (F)    |                                         |   | --                       |   |                           | 6,500   |                                            |   | --                           |   |   | -- |   |   | 6,500 |   |   | 413 |   |
| Equinox  (D)(E)          |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Great      Neck, NY                |   | Retail         |   | 11                | /16    |               | 05     | /16                |   | 5.68                       | %          |             | (F)    |                                         |   | --                       |   |                           | 12,680  |                                            |   | --                           |   |   | -- |   |   | 12,680 |   |   | 718 |   |
| Tiburon      at Buckhead (D)       |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Atlanta,      GA                   |   | Multifamily    |   | 11                | /16    |               | 11     | /08                |   | 5.90                       | %          |             | (G)    |                                         |   | --                       |   |                           | 21,500  |                                            |   | --                           |   |   | -- |   |   | 21,500 |   |   | 1,290 |   |
| Talega      Corporate Center (D)   |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| San      Clemente, CA              |   | Office         |   | 12                | /11    |               | 12     | /10                |   | 5.94                       | %          |             | (F)    |                                         |   | --                       |   |                           | 8,700   |                                            |   | --                           |   |   | -- |   |   | 8,700 |   |   | 525 |   |
| Tennyson      Retail Center (D)    |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Hayward,      CA                   |   | Retail         |   | 1                 | /17    |               | 07     | /16                |   | 5.80                       | %          |             | (H)    |                                         |   | --                       |   |                           | 2,246   |                                            |   | --                           |   |   | -- |   |   | 2,246 |   |   | 133 |   |
| Subtotal      First Mortgage Loans |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           | 330,355 |                                            |   | --                           |   |   | (1,588 | ) |   | 328,767 |   |   | 20,468 |   |
|                               |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
|                               |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Mezzanine      Loans:              |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Club      at Brazos (I) (J) (K)    |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Rosenberg,      TX                 |   | Multifamily    |   | 5                 | /43    |               | 06     | /08                |   | 10.00                      | %      (O) |             | (F)    |                                         |   | 13,963                   |   |                           | 1,962   |                                            |   | --                           |   |   | (66 | ) |   | 1,896 |   |   | 194 |   |
| Oaks      of Baytown (M)           |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Baytown,      TX                   |   | Multifamily    |   | 7                 | /08    |               | N      | /A                 |   | LIBOR      + 4.50          | %          |             | --     |                                         |   | --                       |   |                           | 3,840   |                                            |   | (2,307                       | )      |   | -- |   |   | 1,533 |   |   | -- |   |
| Quay      Point (M)                |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Houston,      TX                   |   | Multifamily    |   | 7                 | /08    |               | N      | /A                 |   | LIBOR      + 3.60          | %          |             | --     |                                         |   | --                       |   |                           | 1,439   |                                            |   | (872                         | )      |   | -- |   |   | 567 |   |   | -- |   |
| Sawmill      Plaza (D)(K)          |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Columbus,      OH                  |   | Retail         |   | 10                | /14    |               | 09     | /14                |   | 13.50                      | %          |             | (H)    |                                         |   | 15,404                   |   |                           | 1,972   |                                            |   | --                           |   |   | -- |   |   | 1,972 |   |   | 271 |   |
| Champaign      Offices (D)(K)      |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Champaign,      IL                 |   | Office         |   | 10                | /11    |               | 05     | /11                |   | 10.67                      | %          |             | (H)    |                                         |   | 26,000                   |   |                           | 1,849   |                                            |   | --                           |   |   | (16 | ) |   | 1,833 |   |   | 202 |   |
| South      Burnswick (K)           |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| South      Brunswick, NJ           |   | Retail         |   | 6                 | /15    |               | 06     | /15                |   | 10.25                      | %          |             | (F)    |                                         |   | 36,020                   |   |                           | 3,244   |                                            |   | --                           |   |   | -- |   |   | 3,244 |   |   | 339 |   |
| Marbella      (K)(M)               |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Clearwater,      FL                |   | Multifamily    |   | 9                 | /06    |               | N      | /A                 |   | LIBOR      + 12.50         | %          |             | (F)    |                                         |   | --                       |   |                           | 5,800   |                                            |   | (5,800                       | )      |   | -- |   |   | -- |   |   | -- |   |
| Pasadena      (K)(M)               |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Pasadena,      FL                  |   | Multifamily    |   | 12                | /07    |               | N      | /A                 |   | LIBOR      + 12.75         | %          |             | (F)    |                                         |   | --                       |   |                           | 8,350   |                                            |   | (8,350                       | )      |   | -- |   |   | -- |   |   | -- |   |
| Bayfront      Villas (K)(M)        |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Gulfport,      FL                  |   | Multifamily    |   | 8                 | /07    |               | N      | /A                 |   | LIBOR      + 12.75         | %          |             | (F)    |                                         |   | --                       |   |                           | 2,800   |                                            |   | (2,800                       | )      |   | -- |   |   | -- |   |   | -- |   |
| Snowmass      Village (E)(N)(K)    |   |           |   |              |   |               |   |               |   |                       |       |             |   |                                         |   |                     |   |                           |    |                                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Snowmass      Village, CO          |   | Mixed      Use |   | 4                 | /11    |               | N      | /A                 |   | LIBOR      + 5.25          | %          |             | (F)    |                                         |   | 520,394                  |   |                           | 32,500  |                                            |   | (32,500                      | )      |   | -- |   |   | -- |   |   | 2,038 |   |

----

----

| Property                                                            |   | Description    |   | FinalMaturityDate |   | Call      Date (A) |   | Interest      Rate |   | PeriodicPayment      Terms |   | Prior      Liens |   | OutstandingFace      Amount of Mortgages      (B) |    | Valuation      Allowance |   | UnamortizedCosts      and Fees |    | Carrying      Amount      of Mortgages      (C) |    | Interest      Income      in 2008 |
|---------------------------------------------------------------------|--------|----------------|--------|-------------------|--------|--------------------|--------|--------------------|--------|----------------------------|--------|------------------|--------|---------------------------------------------------|---------|--------------------------|--------|--------------------------------|---------|-------------------------------------------------|---------|-----------------------------------|
|  City      North (E)(N)(K)                                     |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Phoenix,      AZ                                                    |   | Mixed      Use |   | 5                 | /10    |               | N      | /A                 |   | LIBOR      + 5.5           | %      |             | (F)    |                                              | 217,750 |                     |   | 18,154                         |    |                                            | (18,154 | )                                 |   | -- |   |   | -- |   |   | 1,154 |
| Subtotal      Mezzanine Loans                                       |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   | 81,910                         |    |                                            | (70,783 | )                                 |   | (82 | ) |   | 11,045 |   |   | 4,198 |
|                                                                |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Subordinated      Notes                                             |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Pierre      Laclede Center (D)(K)                                   |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Clayton,      MO                                                    |   | Office         |   | 9                 | /11    |               | 04     | /08                |   | 7.44                       | %      |             | (F)    |                                              | 56,250  |                     |   | 3,375                          |    |                                            | --      |                              |   | -- |   |   | 3,375 |   |   | 250 |
| Intech      (D)(K)                                                  |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Indianapolis,      IN                                               |   | Office         |   | 10                | /15    |               | 07     | /15                |   | 9.05                       | %      |             | (G)    |                                              | 44,500  |                     |   | 5,500                          |    |                                            | --      |                              |   | (153 | ) |   | 5,347 |   |   | 506 |
| Ellington      (D)(L)                                               |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Washington,      DC                                                 |   | Multifamily    |   | 9                 | /16    |               | 09     | /09                |   | 10.00                      | %      |             | (F)    |                                              | 27,300  |                     |   | 17,458                         |    |                                            | --      |                              |   | (1,003 | ) |   | 16,455 |   |   | 1,747 |
| Sage      at Cupertino – B Note (L)                           |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Cupertino,      CA                                                  |   | Multifamily    |   | 5                 | /16    |               | 2      | /16                |   | 6.19                       | %      |             | (G)    |                                              | 22,000  |                     |   | 5,000                          |    |                                            | --      |                              |   | -- |   |   | 5,000 |   |   | 315 |
| Bridgeport      Portfolio (I)                                       |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Bridgeport,      CT                                                 |   | Multifamily    |   | 8                 | /17    |               | 7      | /10                |   | 9.74                       | %      |             | (G)    |                                              | 8,136   |                     |   | 1,110                          |    |                                            | (388    | )                                 |   | -- |   |   | 722 |   |   | 110 |
| Connecticut      Village Apartments (K)                             |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Gaffney,      SC                                                    |   | Multifamily    |   | 12                | /16    |               | 12     | /09                |   | 6.08                       | %      |             | (G)    |                                              | 2,582   |                     |   | 136                            |    |                                            | --      |                              |   | -- |   |   | 136 |   |   | 13 |
| Oakland      Apartments (K)                                         |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Abbeville,      SC                                                  |   | Multifamily    |   | 12                | /16    |               | 12     | /09                |   | 6.08                       | %      |             | (G)    |                                              | 343     |                     |   | 18                             |    |                                            | --      |                              |   | -- |   |   | 18 |   |   | 2 |
| Westwood      Apartments (K)                                        |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Manning,      SC                                                    |   | Multifamily    |   | 12                | /16    |               | 12     | /09                |   | 6.08                       | %      |             | (G)    |                                              | 754     |                     |   | 40                             |    |                                            | --      |                              |   | -- |   |   | 40 |   |   | 4 |
| Lincoln      Apartments (K)                                         |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Walterboro,      SC                                                 |   | Multifamily    |   | 12                | /16    |               | 12     | /09                |   | 6.08                       | %      |             | (G)    |                                              | 22,788  |                     |   | 72                             |    |                                            | --      |                              |   | -- |   |   | 72 |   |   | 7 |
| Raymonis      Apartments (K)                                        |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Vidalia,      GA                                                    |   | Multifamily    |   | 12                | /16    |               | 12     | /09                |   | 6.08                       | %      |             | (G)    |                                              | 1,372   |                     |   | 72                             |    |                                            | --      |                              |   | -- |   |   | 72 |   |   | 7 |
| Westlake      Apartments (K)                                        |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   |                           |    |                                            |    |                              |   |   |   |   |   |   |   |   |
| Savannah,      GA                                                   |   | Multifamily    |   | 12                | /16    |               | 12     | /09                |   | 6.08                       | %      |             | (G)    |                                              | 3,070   |                     |   | 162                            |    |                                            | --      |                              |   | -- |   |   | 162 |   |   | 15 |
| Subtotal      Subordinated Notes                                    |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    |                     |   | 32,943                         |    |                                            | (388    | )                                 |   | (1,156 | ) |   | 31,399 |   |   | 2,976 |
| Total      interest income from loans sold or repaid during 2008    |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              |    | --                       |   |                           | --      |                                            |    | --                                |   |   | -- |   |   | 2,267 |
| 2008      Total Mortgage Loans, Net – Held for Investment     |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              | $       | 445,208                  |   | $                              | (71,171 | )                                               | $       | (2,826                            | ) | $ | 371,211 |   | $ | 29,909 |
| 2007      Total Mortgage Loans, Net – Held for Investment (P) |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              | $       | 490,981                  |   | $                              | (19,709 | )                                               | $       | (3,538                            | ) | $ | 467,734 |   | $ | 44,076 |
| 2007      total mortgage loans, Net – Held for Sale           |   |           |   |              |   |               |   |               |   |                       |   |             |   |                                              | $       | 65,478                   |   | $                              | (3,490  | )                                               | $       | (78                               | ) | $ | 61,910 |   | $ | 3,894 |

----

----

| (A) | Call      date means the date the loan can either be called by us or paid off by      borrower, which may result in prepayment  penalties. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------|

| (B) | As      of December 31, 2008, all interest payments on the mortgage loans are      current, except as noted. |
|-----|--------------------------------------------------------------------------------------------------------------|

| (C) | Carrying      amounts of the loans are net of unamortized origination costs and fees and      loan discounts. |
|-----|---------------------------------------------------------------------------------------------------------------|

| (D) | Loans      are pledged as collateral on $362.0 million of Series I CRE notes issued      during 2006 (see Note 11). |
|-----|---------------------------------------------------------------------------------------------------------------------|

| (E) | Borrower      is a related party (see Note 20). |
|-----|-------------------------------------------------|

| (F) | Interest      only payments due monthly, with loan balance due at    maturity. |
|-----|--------------------------------------------------------------------------------|

| (G) | Currently      interest only payments due monthly, followed by principal and interest      payments due at various futuredates. |
|-----|---------------------------------------------------------------------------------------------------------------------------------|

| (H) | Principal      and interest payments due monthly. |
|-----|---------------------------------------------------|

| (I) | The      Club at Brazos loan is a participating mezzanine loan with a maximum      annual return of 14%.  We can share 50% of excess operating cash      flows, as well as 25% of excess sale or refinancing proceeds on this      loan. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (J) | The      principal balance of the mezzanine loan is secured by the partnership      interests of the entity that owns the underlying property and a third      mortgage deed of trust.  Interest payments on the mezzanine loan      are secured by a second mortgage deed of trust and are guaranteed for the      first 36 months after construction completion by an entity related to the      general partner of the entity that owns the underlying      property. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (K) | We      do not have an interest in the first lien position relating to this      loan. |
|-----|----------------------------------------------------------------------------------------|

| (L) | At      December 31, 2008, we had an interest in the first lien position relating      to this loan. |
|-----|------------------------------------------------------------------------------------------------------|

| (M) | During      2006 and 2007, these mezzanine loans did not make required interest      payments, causing them to be in default.  We recognized      impairment charges of $15.8 million for these loans due to construction      and sales issues relating to the underlying  properties. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (N) | During      2008, these loans did not make required interest payments, causing them to      be in default.  We recorded impairment charges of $50.7 million      on these mezzanine loans due to underlying property      performance. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (O) | Interest      on the mezzanine loan is based on a fixed percentage of the unpaid      principal balance of the related first mortgage loan.  The      amount shown is the approximate effective rate earned on the balance of      the mezzanine loan.  The mezzanine loan also provides for      payments of additional interest based on a percentage of cash flow      remaining after debt service and participation in sale or refinancing      proceeds and certain provisions that cap our total yield, including      additional interest and participations, over the term of the      loan. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (P) | The      weighted average interest rate on the portfolio at December 31, 2007, was      7.62%. |
|-----|------------------------------------------------------------------------------------------------|

----

----

| (in      thousands)                                          |   | Net      FundedAmount(1) |    |   | ValuationAllowance |   |    | CarryingValue |   |
|--------------------------------------------------------------|--------|--------------------------|---------|--------|--------------------|--------|---------|---------------|--------|
|                                                         |   |                     |    |   |               |   |    |          |   |
| December 31, 2008                                            |   |                     |    |   |               |   |    |          |   |
|                                                         |   |                     |    |   |               |   |    |          |   |
| Impaired      loans                                          |   | $                        | 73,993  |   |               | $      | (71,171 | )             |   | $ | 2,822 |   |
| Loans      not impaired                                      |   |                     | 368,389 |   |               |   | --      |          |   |   | 368,389 |   |
|  Total                                                  |   | $                        | 442,382 |   |               | $      | (71,171 | )             |   | $ | 371,211 |   |
|                                                         |   |                     |    |   |               |   |    |          |   |   |   |   |
| December 31, 2007                                            |   |                     |    |   |               |   |    |          |   |   |   |   |
|                                                         |   |                     |    |   |               |   |    |          |   |   |   |   |
| Impaired      loans                                          |   | $                        | 97,293  |   |               | $      | (23,199 | )             |   | $ | 74,094 |   |
| Loans      not impaired                                      |   |                     | 455,550 |   |               |   | --      |          |   |   | 455,550 |   |
|  Total                                                  |   | $                        | 552,843 |   |               | $      | (23,199 | )             |   | $ | 529,644 |   |
|  (1)        Net of unamortized cost and fees. |   |

|                                                                                                                                                                                                                                                      |   | (in      thousands) |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------|---------|
|                                                                                                                                                                                                                                                      |   |                |    |   |
| Balance      at January 1, 2006                                                                                                                                                                                                                           |   | $                   | --      |   |
| Additions      charged to statement of operations                                                                                                                                                                                                         |   |                | 14,219  |   |
| Direct      charge offs net of recoveries                                                                                                                                                                                                                 |   |                | --      |   |
|  Balance      at December 31, 2006                                                                                                                                                                                                                   |   |                | 14,219  |   |
| Additions      charged to statement of operations                                                                                                                                                                                                         |   |                | 10,120  |   |
| Direct      charge offs net of recoveries                                                                                                                                                                                                                 |   |                | (1,140  | ) |
|  Balance      at December 31, 2007                                                                                                                                                                                                                   |   |                | 23,199  |   |
| Additions      charged to statement of operations(1)                                                                                                                                                                                                      |   |                | 62,679  |   |
| Direct      charge offs net of recoveries                                                                                                                                                                                                                 |   |                | (14,707 | ) |
|  Balance      at December 31, 2008                                                                                                                                                                                                                   |   | $                   | 71,171  |   |
|  (1)        Included in “impairment of investments” in the consolidated      statement of operations (see Note 9). A portion of this amount      pertained to properties developed by a related party (see Note      20). |   |

----

----

| Year      of Maturity                 |   | Number      ofLoansMaturing |   | CurrentCarryingValue(in      thousands) |    |
|---------------------------------------|--------|-----------------------------|--------|-----------------------------------------|---------|
|  Prior      to December 31, 2008 |   | 2                           |   | $                                       | 2,100   |   |
| 2009                                  |   | --                          |   |                                    | --      |   |
| 2010                                  |   | 1                           |   |                                    | --      |   |
| 2011                                  |   | 10                          |   |                                    | 57,700  |   |
| 2012                                  |   | --                          |   |                                    | --      |   |
| 2013                                  |   | 1                           |   |                                    | 6,500   |   |
| Thereafter                            |   | 37                          |   |                                    | 304,911 |   |
| Total                                 |   | 51                          |   | $                                       | 371,211 |   |

| (in      thousands)December 31, 2008 |   | CMBS   |   |   | Mortgage      revenue      bonds |   |   | Total  |   |
|--------------------------------------|--------|--------|--------|--------|----------------------------------|--------|--------|--------|--------|
|                                 |   |   |   |   |                             |   |   |   |   |
| Amortized      cost                  |   | $      | 5,474  |   |                             | $      | --     |   |   | $ | 5,474 |   |
|  Unrealized      gains          |   |   | --     |   |                             |   | --     |   |   |   | -- |   |
|  Fair      value                |   | $      | 5,474  |   |                             | $      | --     |   |   | $ | 5,474 |   |

| (in      thousands)December 31, 2007 |   | CMBS   |   |   | Mortgage      revenue      bonds |   |   | Total  |   |
|--------------------------------------|--------|--------|--------|--------|----------------------------------|--------|--------|--------|--------|
|                                 |   |   |   |   |                             |   |   |   |   |
| Amortized      cost                  |   | $      | 69,269 |   |                             | $      | 4,668  |   |   | $ | 73,937 |   |
|  Unrealized      gains          |   |   | --     |   |                             |   | 211    |   |   |   | 211 |   |
|  Fair      value                |   | $      | 69,269 |   |                             | $      | 4,879  |   |   | $ | 74,148 |   |

| a) | CMBS |
|----|------|

----

----

| (dollars      in thousands)                                                  |   | Faceamount |   |   | Purchase      price |   |   | Accreted      cost(1) |   |   | Fair      value |   |   | Percentage      offair      value |   |
|------------------------------------------------------------------------------|--------|------------|--------|--------|---------------------|--------|--------|-----------------------|--------|--------|-----------------|--------|--------|-----------------------------------|--------|
|  Security      rating:                                                  |   |       |   |   |                |   |   |                  |   |   |            |   |   |                              |   |
| BBB+                                                                         |   | $          | 4,750  |   |                | $      | 4,773  |                  |   | $      | 665             |   |   | $                                 | 665    |   |   |   | 12.1 | % |
| BBB                                                                          |   |       | 2,079  |   |                |   | 2,074  |                  |   |   | 462             |   |   |                              | 462    |   |   |   | 8.5 |   |
| BBB-                                                                         |   |       | 1,781  |   |                |   | 1,749  |                  |   |   | 350             |   |   |                              | 350    |   |   |   | 6.4 |   |
| BB                                                                           |   |       | 9,997  |   |                |   | 9,997  |                  |   |   | 3,997           |   |   |                              | 3,997  |   |   |   | 73.0 |   |
|                                                                         |   | $          | 18,607 |   |                | $      | 18,593 |                  |   | $      | 5,474           |   |   | $                                 | 5,474  |   |   |   | 100.0 | % |
|  (1)        Accreted cost is shown net of impairment charges. |   |

| b) | Mortgage      Revenue Bonds |
|----|-----------------------------|

|                                                                                                                                                                                                           | Year      ended December 31, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|--------|
| (in      thousands)                                                                                                                                                                                            | 2008                         |   | 2007 |   |
|                                                                                                                                                                                                           |                         |   |   |   |   |   |
| Escrow      receivable(1)                                                                                                                                                                                      |                         | $      | -- |   |   | $ | 24,287 |   |
| Interest      receivable                                                                                                                                                                                       |                         |   | 2,077 |   |   |   | 5,737 |   |
| Other                                                                                                                                                                                                          |                         |   | 5 |   |   |   | 42 |   |
|                                                                                                                                                                                                           |                         | $      | 2,082 |   |   | $ | 30,066 |   |
|  (1)        Escrow balances were held with Citigroup as collateral for a      repurchase facility and were used to repay a portion of the principal      balance of the facility (see Note 12). |                         |

----

----

|                                                                                                       |   | Year      ended December 31, |   |
|------------------------------------------------------------------------------------------------------------|--------|------------------------------|--------|
| (in      thousands)                                                                                        |   | 2008                         |   |   | 2007 |   |
|                                                                                                       |   |                         |   |   |   |   |
| Deferred      financing charges, net of accumulated amortization of $2,340 in 2008 and      $1,030 in 2007 |   | $                            | 6,019  |   |   | $ | 6,867 |   |
| Other      assets                                                                                          |   |                         | 107    |   |   |   | 47 |   |
|  Total                                                                                                |   | $                            | 6,126  |   |   | $ | 6,914 |   |

|                                          |   | Year      ended December 31, |   |
|-----------------------------------------------|--------|------------------------------|--------|
|                                          |   | 2008                         |   |   | 2007 |   |   | 2006 |   |
|  Revenues                                |   | $                            | 41     |   |   | $ | 1,815 |   |   | $ | 7,597 |   |
| (Loss)      gain on sale of real estate owned |   | $                            | (772   | ) |   | $ | 3,611 |   |   | $ | -- |   |
| Net      income                               |   | $                            | (731   | ) |   | $ | 3,531 |   |   | $ | 255 |   |

----

----

----

----

| (in      thousands)                                             |   | 2008   |   |   | 2007   |   |    | 2006   |   |
|-----------------------------------------------------------------|--------|--------|--------|--------|--------|--------|---------|--------|--------|
|                                                            |   |   |   |   |   |   |    |   |   |
| Mortgage      loans receivable (Note 4)                         |   | $      | (39    | )      |   | $      | (4,448  | )      |   | $ | -- |   |
| CMBS      (Note 5)                                              |   |   | (5,644 | )      |   |   | (10,373 | )      |   |   | -- |   |
| CDO      equity (Note 5)                                        |   |   | --     |   |   |   | (2,123  | )      |   |   | -- |   |
| Debt      securities (Note 5)                                   |   |   | --     |   |   |   | (2,212  | )      |   |   | (934 | ) |
| Investment      in ARCap                                        |   |   | 495    |   |   |   | 337     |   |   |   | 19,223 |   |
| Subtotal      – continuing operations                     |   |   | (5,188 | )      |   |   | (18,819 | )      |   |   | 18,289 |   |
| Discontinued      operations – Real estate owned (Note 8) |   |   | (772   | )      |   |   | 3,611   |   |   |   | -- |   |
| Total                                                           |   | $      | (5,960 | )      |   | $      | (15,208 | )      |   | $ | 18,289 |   |

| (in      thousands)                     |   | 2008   |     |   | 2007   |   |    | 2006   |   |
|-----------------------------------------|--------|--------|----------|--------|--------|--------|---------|--------|--------|
|                                    |   |   |     |   |   |   |    |   |   |
| Mortgage      loans receivable (Note 4) |   | $      | (62,679  | )      |   | $      | (10,120 | )      |   | $ | (14,219 | ) |
| CMBS      (Note 5)                      |   |   | (44,086  | )      |   |   | (28,175 | )      |   |   | -- |   |
| Mortgage      revenue bonds (Note 5)    |   |   | (2,433   | )      |   |   | --      |   |   |   | -- |   |
| Debt      securities (Note 5)           |   |   | --       |   |   |   | --      |   |   |   | (2,224 | ) |
| Total                                   |   | $      | (109,198 | )      |   | $      | (38,295 | )      |   | $ | (16,443 | ) |

----

----

|                |   | Year      Ended December 31, |   |
|---------------------|--------|------------------------------|--------|
| (in      thousands) |   | 2008                         |   |   | 2007 |   |
|                |   |                         |   |   |   |   |
| Citigroup           |   | $                            | --     |   |   | $ | 81,345 |   |
| Bear      Stearns   |   |                         | --     |   |   |   | 55,040 |   |
|  Total         |   | $                            | --     |   |   | $ | 136,385 |   |

----

----

| ·   | minimum      adjusted net worth; |
|--------------------|----------------------------------|

| ·   | liquidity; |
|--------------------|------------|

| ·   | debt      service coverage; |
|--------------------|-----------------------------|

| ·   | recourse      debt to adjusted net worth; and |
|--------------------|-----------------------------------------------|

| ·   | minimum      adjusted AFFO. |
|--------------------|-----------------------------|

----

----

|                                                                                                                                                                                                                                               |   | Year      Ended December 31, |    |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|---------|
| (in      thousands)                                                                                                                                                                                                                                |   | 2008                         |    |   | 2007 |   |   | 2006 |   |
|  Included      in interest expense:                                                                                                                                                                                                           |   |                         |    |   |   |   |   |   |   |
| Interest      receipts                                                                                                                                                                                                                             |   | $                            | 3       |   |   | $ | 1,510 |   |   | $ | 588 |   |
| Interest      payments                                                                                                                                                                                                                             |   |                         | (8,679  | ) |   |   | (891 | ) |   |   | (132 | ) |
| Ineffectiveness(1)                                                                                                                                                                                                                                 |   |                         | (131    | ) |   |   | 159 |   |   |   | (148 | ) |
| Subtotal                                                                                                                                                                                                                                           |   |                         | (8,807  | ) |   |   | 778 |   |   |   | 308 |   |
|  Included      in other income (losses):                                                                                                                                                                                                      |   |                         |    |   |   |   |   |   |   |   |   |   |
| Loss      on termination                                                                                                                                                                                                                           |   |                         | (4,207  | ) |   |   | (10,208 | ) |   |   | -- |   |
| Change      in fair value                                                                                                                                                                                                                          |   |                         | --      |   |   |   | (1,373 | ) |   |   | (5,299 | ) |
| Subtotal                                                                                                                                                                                                                                           |   |                         | (4,207  | ) |   |   | (11,581 | ) |   |   | (5,299 | ) |
|  Net      impact                                                                                                                                                                                                                              |   | $                            | (13,014 | ) |   | $ | (10,803 | ) |   | $ | (4,991 | ) |
|  (1)        Relates to one swap, which includes an embedded financing component      that has caused and may continue to cause some ineffectiveness within the      limits allowed by SFAS No. 133 to maintain hedge    accounting. |   |

----

----

|                                                                                                                                                                  | Year      Ended December 31, |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|
| (in      thousands)                                                                                                                                                   | 2008                         |   | 2007 |
|  Refundable      deposits (1)                                                                                                                                    | $                            | 133 |   | $ | 161 |
| Accrued      interest payable                                                                                                                                         |                         | 972 |   |   | 14,446 |
| Other                                                                                                                                                                 |                         | 258 |   |   | 1,686 |
|                                                                                                                                                                  | $                            | 1,363 |   | $ | 16,293 |
|  (1)        Includes refundable deposits collected during the due diligence      period of a loan transaction which are payable to other      parties. |

| (dollars      in thousands) |   | Number      of Shares |   | Expense |   |
|-----------------------------|--------|-----------------------|--------|---------|--------|
|  2008                  |   | 69,232                |   | $       | 45     |   |
| 2007                        |   | 33,539                |   | $       | 120    |   |
| 2006                        |   | 2,040                 |   | $       | 30     |   |

----

----

| (in      thousands)                     |   | Net      unrealized gain      (loss) on investments |    |   | Net      unrealized gain      (loss) oninterest      rate derivatives |   |    | Total  |   |
|-----------------------------------------|--------|-----------------------------------------------------|---------|--------|-----------------------------------------------------------------------|--------|---------|--------|--------|
|  Balance      at January 1, 2006   |   | $                                                   | 3,975   |   |                                                                  | $      | 808     |   |   | $ | 4,783 |   |
| Period      change                      |   |                                                | (6,993  | )      |                                                                  |   | (3,642  | )      |   |   | (10,635 | ) |
| Reclassification      adjustments       |   |                                                | 2,224   |   |                                                                  |   | --      |   |   |   | 2,224 |   |
|  Balance      at December 31, 2006 |   |                                                | (794    | )      |                                                                  |   | (2,834  | )      |   |   | (3,628 | ) |
| Period      change                      |   |                                                | (41,746 | )      |                                                                  |   | (26,070 | )      |   |   | (67,816 | ) |
| Reclassification      adjustments       |   |                                                | 42,751  |   |                                                                  |   | 9,440   |   |   |   | 52,191 |   |
|  Balance      at December 31, 2007 |   |                                                | 211     |   |                                                                  |   | (19,464 | )      |   |   | (19,253 | ) |
| Period      change                      |   |                                                | (46,730 | )      |                                                                  |   | (35,726 | )      |   |   | (82,456 | ) |
| Reclassification      adjustments       |   |                                                | 46,519  |   |                                                                  |   | 1,567   |   |   |   | 48,086 |   |
|  Balance      at December 31, 2008 |   | $                                                   | --      |   |                                                                  | $      | (53,623 | )      |   | $ | (53,623 | ) |

|                                                               |   | 2008    |   | 2007                                       |   | 2006    |   |
|--------------------------------------------------------------------|--------|---------|--------|--------------------------------------------|--------|---------|--------|
|                                                               |   | Options |   |  Weighted      Average Exercise Price |   | Options |   | Weighted      Average Exercise Price |   | Options |   | Weighted      Average Exercise Price |   |
|                                                               |   |    |   |                                       |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding      at Beginning of Year                              |   |    | 93,000 |                                       | $      | 15.03   |   |   | 93,000 |   | $ | 15.03 |   |   | 187,052 |   | $ | 15.78 |   |
| Granted                                                            |   |    | --     |                                       |   | --      |   |   | -- |   |   | -- |   |   | -- |   |   | -- |   |
| Forfeited                                                          |   |    | --     |                                       |   | --      |   |   | -- |   |   | -- |   |   | -- |   |   | -- |   |
| Exercised                                                          |   |    | --     |                                       |   | --      |   |   | -- |   |   | -- |   |   |  (94,052 | ) |   | 16.53 |   |
| Outstanding      at End of Year                                    |   |    | 93,000 |                                       |   | 15.03   |   |   | 93,000 |   | $ | 15.03 |   |   |  93,000 |   | $ | 15.03 |   |
| Fair      Value of options granted during the year (at grant date) |   | $       | --     |                                       | $      | --      |   | $ | -- |   | $ | -- |   | $ | -- |   | $ | -- |   |
| Compensation      cost recognized                                  |   | $       | --     |                                       |   |    |   | $ | -- |   |   |   |   | $ | 59,000 |   |   |   |   |

----

----

|                                                    | As      of December 31, 2008 |   |
|---------------------------------------------------------|------------------------------|--------|
|                                                    | Options                      |   | Weighted      AverageExercisePrice |   |  Weighted      AverageRemaining      Contractual      Term(in      years) |   | Aggregate      Intrinsic      Value(in      thousands) |   |
|  Vested      and expected to vest at end of period | 93,000                       |   | $ | 15.03 |   | 4.3 |   | $ | -- |   |
| Exercisable      at end of year                         | 93,000                       |   | $ | 15.03 |   | 4.3 |   | $ | -- |   |

| (in      thousands, except per share amounts)                                                                                                                                                                             |   | 2008   |     | 2007   |   | 2006    |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|----------|--------|--------|---------|--------|
|                                                                                                                                                                                                                      |   |   |     |   |   |    |   |   |   |   |
| Numerator:                                                                                                                                                                                                                |   |   |     |   |   |    |   |   |   |   |
| (Loss)      income from continuing operations                                                                                                                                                                             |   | $      | (121,543 | )      | $      | (62,113 | )      | $ | 2,432 |   |
| Preferred      dividends (including dividends in arrears)                                                                                                                                                                 |   |   | (1,232   | )      |   | (527    | )      |   | -- |   |
| Net      (loss) income for EPS calculations                                                                                                                                                                               |   | $      | (122,775 | )      | $      | (62,640 | )      | $ | 2,432 |   |
|  Denominator:                                                                                                                                                                                                        |   |   |     |   |   |    |   |   |   |   |
| Weighted      average shares outstanding (basic)                                                                                                                                                                          |   |   | 8,471    |   |   | 8,404   |   |   | 8,323 |   |
| Effect      of dilutive shares                                                                                                                                                                                            |   |   | --       |   |   | --      |   |   | 7 |   |
| Weighted      average shares outstanding (diluted)                                                                                                                                                                        |   |   | 8,471    |   |   | 8,404   |   |   | 8,330 |   |
|  Calculation      of EPS from continuing operations:                                                                                                                                                                 |   |   |     |   |   |    |   |   |   |   |
| (Loss)      income as computed above                                                                                                                                                                                      |   | $      | (122,775 | )      | $      | (62,640 | )      | $ | 2,432 |   |
| Weighted      average shares outstanding                                                                                                                                                                                  |   |   | 8,471    |   |   | 8,404   |   |   | 8,330 | (1) |
| (Loss)      income per share                                                                                                                                                                                              |   | $      | (14.49   | )      | $      | (7.45   | )      | $ | 0.29 |   |
|   (1)        As the difference between basic and diluted shares is insignificant      with no impact on earnings per share, a separate calculation of basic      earnings per share is not presented. |   |

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| (in      thousands)                                |   | Year      Ended December 31, |   |
|----------------------------------------------------|--------|------------------------------|--------|
|                                               |   | 2008                         |   |   | 2007 |   |   | 2006 |   |
|  Fees      to Advisor and affiliates:         |   |                         |   |   |   |   |   |   |   |
| Shared      services expenses                      |   | $                            | 1,361  |   |   | $ | 1,660 |   |   | $ | 1,672 |   |
| Asset      management fees                         |   |                         | 813    |   |   |   | 1,570 |   |   |   | 1,810 |   |
| Servicing      fees                                |   |                         | 361    |   |   |   | 566 |   |   |   | 64 |   |
|  Total      fees to Advisor and affiliates    |   | $                            | 2,535  |   |   | $ | 3,796 |   |   | $ | 3,546 |   |
|  Other      costs:                            |   |                         |   |   |   |   |   |   |   |   |   |   |
| Interest      paid on related party line of credit |   | $                            | 7,870  |   |   | $ | 2,970 |   |   | $ | 1,461 |   |

| ·   | For      the purposes of calculating the asset management fee, the definition of      Company Equity was modified to exclude unrealized losses recognized in      earnings that result from changes in market values of securities      classified as available-for-sale;and |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Expense      reimbursements are to be payable to the Advisor in the form of a quarterly      flat-fee of $0.4 million based on the projected costs of the Advisor for      providing services to us.  Prior to the amendment, these fees      were paid based on a complex allocation provided by the      Advisor. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                           |   | 2008      Quarter Ended(Unaudited)       |    |
|------------------------------------------------------------------------------------------------|--------|------------------------------------------|---------|
| (in      thousands except per share amounts)                                                   |   | March      31(1)                         |    |   | June      30 |   |   | September      30(1) |   |   | December      31 (1) |   |
|  Total      revenues                                                                      |   | $                                        | 10,685  |   |   | $ | 9,811 |   |   | $ | 9,560 |   |   | $ | 7,006 |   |
|  Net      income (loss)                                                                   |   | $                                        | (28,974 | ) |   | $ | (4,856 | ) |   | $ | (69,348 | ) |   | $ | (18,365 | ) |
|  Net      income (loss) from continuing operations per share (basic and      diluted)     |   | $                                        | (3.47   | ) |   | $ | (0.61 | ) |   | $ | (8.22 | ) |   | $ | (2.19 | ) |
|  Net      income from discontinued operations per share (basic      and diluted)          |   | $                                        | --      |   |   | $ | -- |   |   | $ | (0.09 | ) |   | $ | -- |   |
|  Net      income (loss) per share (basic and diluted)                                     |   | $                                        | (3.47   | ) |   | $ | (0.61 | ) |   | $ | (8.31 | ) |   | $ | (2.19 | ) |
|                                                                                           |   |  2007      Quarter Ended(Unaudited) |    |
| (in      thousands except per share amounts)                                                   |   | March      31                            |    |   | June      30 |   |   | September      30 |   |   | December      31(1) |   |
|  Total      revenues                                                                      |   | $                                        | 12,501  |   |   | $ | 15,312 |   |   | $ | 16,948 |   |   | $ | 15,348 |   |
|  Net      income (loss)                                                                   |   | $                                        | 5,164   |   |   | $ | 3,477 |   |   | $ | (187 | ) |   | $ | (67,036 | ) |
|  Net      income (loss) from continuing operations per share (basic and      diluted)     |   | $                                        | 0.19    |   |   | $ | 0.41 |   |   | $ | (0.05 | ) |   | $ | (8.00 | ) |
|  Net      income from discontinued operations per share (basic      and diluted)          |   | $                                        | 0.42    |   |   | $ | -- |   |   | $ | -- |   |   | $ | -- |   |
|  Net      income (loss) per share (basic and diluted)                                     |   | $                                        | 0.61    |   |   | $ | 0.41 |   |   | $ | (0.05 | ) |   | $ | (8.00 | ) |
|  (1)Includes      impairment losses and losses on sales of investments (see Note      9). |   |

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