Document:

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                                                                    Exhibit 10.1

                          PROPERTY MANAGEMENT AGREEMENT
                                       FOR
                        PRESTON AT WILLOW BEND APARTMENTS
                                  PLANO, TEXAS

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                                TABLE OF CONTENTS

<Table>
<Caption>
                  PAGE
<S>                                                                                     <C>
ARTICLE 1. RETENTION OF MANAGER; GENERAL DEFINITIONS                                     3
        1.1  Retention of Manager.                                                       3
        1.2  General Definitions.                                                        3

ARTICLE 2. MANAGER'S RESPONSIBILITIES                                                    6
        2.1  General Responsibilities.                                                   6
        2.2  Manager's Personnel; Independent Contractor                                 6
        2.3  Executive Personnel; Property Manager.                                      7
        2.4  Schedule of Employees.                                                      7
        2.5  Compliance with Laws, Licenses, Mortgages, Etc.                             8
        2.6  Security.                                                                   9
        2.7  Energy Management.                                                         10
        2.8  Annual Business Plan.                                                      10
        2.9  Service Contracts.                                                         11
        2.10   Collection of Rents and Other Income.                                    12
        2.11   Competitive Bidding.                                                     12
        2.12   Repairs.                                                                 12
        2.13   Leases                                                                   14
        2.14   Notices to Owner.                                                        16
        2.15   Property Tax Appeals.                                                    17
        2.16   No Other Fees.                                                           17
        2.17   REIT Status.                                                             17

ARTICLE 3. INSURANCE AND CLAIMS                                                         17
        3.1  Owner's Insurance and Rights.                                              17
        3.2  Manager's Insurance.                                                       18
        3.3  Indemnification.                                                           19
        3.4  Contractors' and Subcontractors' Insurance.                                20
        3.5  Waiver of Subrogation.                                                     21
        3.6  Service Contracts.                                                         21
        3.7  Claims.                                                                    21

ARTICLE 4. FINANCIAL REPORTING AND RECORD KEEPING                                       21
        4.1  Financial Controls.                                                        21
        4.2  Financial Reports: General Requirements.                                   21
        4.3  Periodic Statements                                                        22
        4.4  Supporting Documentation.                                                  23
        4.5  Annual Financial Reports.                                                  24
        4.6  Transfer of Funds.                                                         24
        4.7  Owner's Property.                                                          24
        4.8  Books and Records.                                                         25
</Table>

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<Table>
<S>                                                                                     <C>
ARTICLE 5. OWNER'S RIGHT TO AUDIT                                                       25
        5.1  Right to Audit.                                                            25

ARTICLE 6. BANK ACCOUNTS                                                                26
        6.1  Operating Account.                                                         26
        6.2  Security Deposit Account.                                                  26
        6.3  Change of Banks.                                                           26
        6.4  Access to Account.                                                         26

ARTICLE 7. PAYMENT OF EXPENSES                                                          27
        7.1  Costs Eligible for Payment from Operating Account.                         27
        7.2  Non-Reimbursable Costs.                                                    28

ARTICLE 8. INSUFFICIENT GROSS INCOME                                                    29
        8.1  Priorities.                                                                29
        8.2  Statement of Unpaid Items.                                                 30
        8.3  Segregation of Accounts.                                                   30
        8.4  Cash Flow Forecasting.                                                     30
        8.5  Manager Not Obligated to Fund.                                             30

ARTICLE 9. SALE OR FINANCING OF PROPERTY                                                30
        9.1  Cooperation with Broker.                                                   30
        9.2  No Sales/Brokerage Commissions.                                            31

ARTICLE 10. COOPERATION                                                                 31
        10.1   Cooperation.                                                             31

ARTICLE 11. COMPENSATION                                                                31
        11.1   Compensation.                                                            31

ARTICLE 12. TERMINATION                                                                 32
        12.1   Termination.                                                             32
        12.2   Termination Without Notice.                                              33
        12.3   Final Accounting.                                                        33
        12.4   Obligation to Vacate: Orderly Transition.                                34

ARTICLE 13. SUBSIDIARIES AND AFFILIATES                                                 34
        13.1   Subsidiaries and Affiliates.                                             34

ARTICLE 14. NOTICES                                                                     34
        14.1   Notices.                                                                 34

ARTICLE 15. CERTAIN REPRESENTATIONS AND COVENANTS                                       35
        15.1   Manager Representations.                                                 35

ARTICLE 16. MISCELLANEOUS                                                               35
        16.1   Word Meanings.                                                           35
        16.2   Assignment.                                                              35
</Table>

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<Table>
<S>                                                                                     <C>
        16.3   Binding Provisions.                                                      35
        16.4   Nondiscrimination.                                                       35
        16.5   Applicable Law.                                                          36
        16.6   Severability of Provisions.                                              36
        16.7   Section Titles.                                                          36
        16.8   Further Assurances.                                                      36
        16.9   Entire Agreement.                                                        36
        16.10  Waiver.                                                                  37
        16.11  Agreement in Counterparts.                                               37
        16.12  Attorneys' Fees.                                                         37
        16.13  Time Periods.                                                            37
        16.14  Modification of Agreement.                                               37
        16.15  Time of the Essence.                                                     37
        16.16  Construction of Agreement.                                               37
        16.17  Consent and Approvals.                                                   37
        16.18  Use of Owner's Name Prohibited.                                          38
        16.19  Exculpation.                                                             38
        16.20  Confidentiality.                                                         38
        16.21  No Joint Venture.                                                        38
</Table>

Exhibits

<Table>
        <S>    <C>
        A      Reporting Package
        B      Executive Personnel and Property Manager
        C      Reimbursable Employee Expense Schedule
        D      Annual Business Plan
        E      List of Service Contracts
        H      Periodic Statements
        I      Capitalization Policy
        J      Chart of Accounts
</Table>

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                          PROPERTY MANAGEMENT AGREEMENT

         This Property Management Agreement is made and entered into as of this
_______ day of September, 2005, by and between BC Broadstone Preston, LP, a
Delaware limited partnership ("OWNER") and Alliance Residential, LLC, an Arizona
limited liability company ("MANAGER").

                                   BACKGROUND

         A.       Owner owns the Property (defined herein).

         B.       Manager is skilled and experienced in the management,
operation, leasing and supervision in properties similar to the Property in the
geographic area where the Property is located.

         C.       Owner desires to engage Manager as an independent contractor
on the terms and conditions set forth below and Manager desires to accept such
engagement.

         NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Owner and Manager agree as
follows:

           THE BALANCE OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

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                               PART I - BASIC DATA

         The following defined terms shall have the meaning set forth below:

         "COMMENCEMENT DATE" - September ____, 2005.

         "EXCESS MANAGEMENT FEE PERCENTAGE" - 0.5%

         "MANAGEMENT FEE PERCENTAGE" - 3.0%

         "MANAGER'S NOTICE ADDRESS" -

                  Alliance Residential, LLC
                  4808 North 22nd Street, Suite 200
                  Phoenix, Arizona 85016
                  Attention: V. Jay Hiemenz

                  With copies to:

                  Locke Liddell & Sapp LLP
                  2200 Ross Avenue, Suite 2200
                  Dallas, Texas 75201
                  Attention: Toni Weinstein, Esq.

         "OWNER'S NOTICE ADDRESS"

                  BC Broadstone Preston, LP
                  c/o Alliance Residential Company
                  4808 North 22nd Street, Suite 200
                  Phoenix, Arizona 85016
                  Attention: V. Jay Hiemenz

                  with copies to:

                  ALLTX, LLC
                  c/o Boston Capital Corporation
                  One Boston Place - Suite 2100
                  Boston, Massachusetts 02108
                  Attn: Mark W. Dunne

                  and

                  Goodwin Procter LLP
                  Exchange Place
                  Boston, Massachusetts 02109-2881

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                  Attn: Andrew C. Sucoff, Esq.

         "PROPERTY" - that certain property consisting of the multi-family
apartment complex known as Preston at Willow Bend Apartments (to be renamed
"Broadstone Preston at Willow Bend Apartments" within a reasonable period of
time following the Property Closing Date) located in the City of Plano, County
of Collin, State of Texas, together with all personal property of Owner attached
thereto, located thereon or used in connection therewith.

           THE BALANCE OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

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                            PART II - STANDARD TERMS

              ARTICLE 1. RETENTION OF MANAGER; GENERAL DEFINITIONS

         1.1      RETENTION OF MANAGER. Owner hereby retains Manager to perform
the services described below in accordance with the terms and conditions of this
Agreement, utilizing trained, experienced personnel and employing professional
real estate management practices and techniques. Manager accepts the appointment
of Manager and covenants to use its best skill and prudent business judgment in
furthering the interests of Owner, and to act in a fiduciary manner for the
benefit of Owner with respect to the collection of rents and the accounting for
the Property. Manager's duties and responsibilities will commence on the
Commencement Date and shall continue until the expiration or earlier termination
of this Agreement in accordance with ARTICLE 12.

         1.2      GENERAL DEFINITIONS. As used in this Agreement, the following
terms shall have the following respective meanings:

         "AFFILIATE OF MANAGER" shall mean any person or entity which (i) is a
director, officer, partner, member or trustee of Manager, or in which Manager or
any Manager Owner is a director, officer, partner, member or trustee, (ii) has
any direct or indirect legal or beneficial interest in Manager, or in which
Manager or any Manager Owner has any direct or indirect legal or beneficial
interest, or (iii) directly or indirectly controls, is controlled by or is under
common control with Manager.

         "AGREEMENT" shall mean this Property Management Agreement, which
consists of Part I and Part II and such other Parts as may be attached hereto
and executed by Owner and Manager, including all Schedules and Exhibits hereto,
all as amended from time to time in accordance with the terms hereof.

         "ALTERATIONS" shall have the meaning set forth in SECTION 2.12.

         "ANNUAL BUSINESS PLAN" shall mean the annual business plan to be
prepared by Manager and approved by Owner in accordance with SECTION 2.8.

         "APPROVED ANNUAL BUSINESS PLAN" shall mean, at any time, the Annual
Business Plan as then approved by Owner in accordance with SECTION 2.8.

         "BOOKS AND RECORDS" shall have the meaning set forth in SECTION 4.8.

         "BUSINESS DAY" shall mean every day that is not a Saturday, Sunday or
day on which banks in Massachusetts or the state in which the Property is
located are required by law or executive action to be closed for the transaction
of normal banking business.

         "CHART OF ACCOUNTS" shall mean the form of chart of accounts approved
by Owner, a copy of which is included in the Reporting Package, as the same may
be modified or replaced as required by Owner from time to time.

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         "CONSTRUCTION MANAGEMENT FEE" shall have the meaning set forth in
SECTION 2.12.

         "DAMAGES" shall mean all claims, actions, suits, proceedings,
judgments, damages, fines, penalties, losses and expenses, including reasonable
attorneys' fees, consultants' and expert witness fees and court costs, including
any such costs incurred in any bankruptcy or other legal or administrative
proceeding.

         "ENVIRONMENTAL LAWS" herein shall mean the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section
9601, et seq., Hazardous Materials Transportation Act, 49 U.S.C. Section 1801,
et seq., Resource Conservation and Recovery Act of 1976, 42 U.S.C. Section 6901
et seq., Clean Air Act, 42 U.S.C. Section 7401 et seq., Clean Water Act, 33
U.S.C. Section 1251, et seq., Safe Drinking Water Act, 14 U.S.C. Section 300f,
et seq., Toxic Substances Control Act, 15 U.S.C. Section 2601, et seq., Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C, Section 136 et seq., Atomic
Energy Act of 1954, 42 U.S.C. Section 2014 et seq., and any similar federal,
state or local Laws, and all regulations, guidelines, directives and other
requirements thereunder, all as may be amended or supplemented from time to
time.

         "ENVIRONMENTAL LIABILITIES" herein shall mean conditions that involve
the presence (whether actual or alleged) of any Hazardous Materials, conditions
that are subject to any Environmental Laws, and all claims relating thereto.

         "EXECUTIVE PERSONNEL" shall have the meaning set forth in SECTION 2.3.

         "EXCESS MANAGEMENT FEE" shall mean the product of (x) the Excess
Management Fee Percentage times (y) all Rents actually collected for each month
during the term of this Agreement. Manager shall not be entitled to receive any
Excess Management Fee for the period following the date Manager acquires actual
knowledge or receives notice of a default by Owner under any first mortgage loan
for the Property, and any Excess Management Fee received by Manager for any
period following the date Manager acquired knowledge or received notice of such
default, shall be held in trust for such first mortgage lender.

         "EXCESS MANAGEMENT FEE PERCENTAGE" shall have the meaning set forth in
Part I.

         "FINAL ACCOUNTING" shall have the meaning set forth in SECTION 12.3.

         "GAAP" shall mean generally accepted accounting principles consistently
applied.

         "HAZARDOUS MATERIALS" shall mean any hazardous, toxic or dangerous
substance, material, or waste as defined for purposes of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended, 42
U.S.C. 9601, ET SEQ., or any other federal, state or local law, ordinance, or
regulation applicable to the Property and establishing standards and/or
requirements for liability, storage, uncontrolled loss, seepage, filtration,
disposal, removal, use or existence of a hazardous, toxic or dangerous
substance, material or waste, including, without limitation, petroleum or
petroleum products, asbestos, radon, polychlorinated biphenyls and all of those
chemicals, substances, materials, controlled substances, objects, conditions,
wastes,

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living organisms or combinations thereof which are now or become in the future
listed, defined or regulated in any manner by any federal, state or local law
based upon its being, directly or indirectly, hazardous to human health or
safety or to the environment due to its radioactivity, ignitability,
corrosivity, reactivity, explosivity, toxicity, carcinogenicity, mutagenicity,
phytoxicity, infectiousness or other harmful or potentially harmful properties
or effects, but excluding such substances or materials in amounts customarily
used by the tenants of, or in connection with the operation, of residential
apartment building.

         "INSURANCE REQUIREMENTS" shall mean all requirements of any insurance
policy covering the Property or the use thereof, all requirements of the issuer
of any such policy, and all requirements, orders, rules or regulations of the
National Board of Fire Underwriters (or similar agencies) applicable to the
Property.

         "INVESTOR" shall have the meaning set forth in that certain Limited
Partnership Agreement of BC Broadstone Preston, LP of even date herewith.

         "LEGAL REQUIREMENTS" shall mean all federal, state and municipal laws,
rules or regulations applicable to the Property or the operation, occupancy,
leasing, maintenance and repair thereof.

         "LICENSES" shall mean all permits, licenses, certificates, approvals,
consents and other entitlements required for the operation, occupancy, leasing,
maintenance and repair of the Property.

         "MANAGER" shall have the meaning set forth in the introductory
paragraph.

         "MANAGEMENT FEE" shall mean the product of (x) the Management Fee
Percentage times (y) all Rents actually collected for each month during the term
of this Agreement.

         "MANAGEMENT FEE PERCENTAGE" shall have the meaning set forth in Part I.

         "MANAGER OWNER" shall mean any person or entity that owns, directly or
indirectly, 25% or more of the legal or beneficial ownership interests in
Manager.

         "MONTHLY STATEMENT" shall have the meaning set forth in SECTION 4.3.

         "OPERATING ACCOUNT" shall have the meaning set forth in SECTION 6.1.

         "OWNER" shall have the meaning set forth in the introductory paragraph.

         "OWNER RELATED ENTITIES" shall mean Owner, its direct and indirect
legal and beneficial owners, and all officers, directors, trustees, employees,
advisors and agents of Owner and all of Owner's direct and indirect legal and
beneficial owners.

         "PROPERTY" shall have the meaning set forth in Part I.

         "PROPERTY BUDGET" shall have the meaning set forth in SECTION 2.8(b).

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         "PROPERTY MANAGER" shall have the meaning set forth in SECTION 2.3.

         "REIMBURSABLE EMPLOYEE EXPENSE SCHEDULE" shall have the meaning set
forth in SECTION 2.4.

         "REIT" shall have the meaning set forth in SECTION 2.17.

         "RENTS" shall have the meaning set forth in SECTION 11.1.

         "REPORTING PACKAGE" shall mean the sample reports prepared by Manager
and attached hereto as EXHIBIT A, as modified or supplemented as required by
Owner from time to time in accordance with ARTICLE 4.

         "SECURITY COMPANY" shall have the meaning set forth in SECTION 2.6.

         "SECURITY SERVICES" shall have the meaning set forth in SECTION 2.6(b).

         "SERVICE CONTRACTS" shall have the meaning set forth in SECTION 2.9.

                      ARTICLE 2. MANAGER'S RESPONSIBILITIES

         2.1      GENERAL RESPONSIBILITIES. Subject to the provisions of this
Agreement, Manager shall manage, operate and maintain the Property in accordance
with the Approved Annual Business Plan. Manager shall perform its duties
hereunder: (a) in all material respects in accordance with the terms of this
Agreement; (b) in compliance with all Legal Requirements; and (c) in accordance
with the standards and practices of prudent and qualified managers that manage
properties similar to the Property on behalf of institutional owners or
investors.

         2.2      MANAGER'S PERSONNEL; INDEPENDENT CONTRACTOR.

                     (a) Manager shall use commercially reasonable efforts to
            have in its employ at all times a sufficient number of employees to
            enable it to manage, operate, maintain and account for the Property
            and otherwise perform its obligations hereunder in accordance with
            the terms of this Agreement and Approved Annual Business Plan.

                     (b) All matters relating to the employment, supervision,
            compensation, promotion and discharge of such employees are the
            responsibility of Manager (with respect to which Manager shall
            exercise reasonable care); Manager is in all respects the employer
            of such employees. Manager shall negotiate with any union lawfully
            entitled to represent such employees and may execute in its own
            name, and not as agent for Owner, collective bargaining agreements
            or labor contracts resulting therefrom. Manager represents that it
            is and will continue to be an equal opportunity employer and that it
            shall advertise as such. This Agreement is not one of agency by
            Manager for Owner, but one with Manager engaged independently in the
            business of

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            managing properties as an independent contractor. All employment
            arrangements are therefore solely Manager's responsibility and Owner
            shall not have any liability with respect thereto. Except as set
            forth in SECTION 2.4 below, nothing contained herein shall be deemed
            to permit Manager to charge Owner, or to use the income of the
            Property to pay, for the services of Manager's employees.

                     (c) Manager shall fully comply with all applicable laws,
            rules, regulations and orders relating to worker's compensation,
            social security, unemployment insurance, wages, hours, working
            conditions and other matters pertaining to Manager's personnel.
            Manager shall indemnify, defend and hold harmless Owner Related
            Entities from and against all Damages arising out of or relating to
            Manager's failure to comply with this SECTION 2.2. Manager's
            indemnification obligations under this SECTION 2.2(c) shall survive
            the termination or expiration of this Agreement.

                     (d) Manager shall be solely responsible for its personnel
            in the event of the termination of this Agreement.

         2.3      EXECUTIVE PERSONNEL; PROPERTY MANAGER. EXHIBIT B sets forth
the name of: (a) the senior executive personnel of Manager who will be
responsible for the performance of Manager's duties under this Agreement (the
"EXECUTIVE PERSONNEL"); and (b) Manager's on-site Property Manager (the
"PROPERTY MANAGER"). Any change in the Property Manager shall be subject to
Owner's prior approval, which approval shall not be unreasonably withheld or
delayed.

         2.4      SCHEDULE OF EMPLOYEES. Attached hereto as EXHIBIT C is a
schedule (the "REIMBURSABLE EMPLOYEE EXPENSE SCHEDULE") that sets forth: (a) a
list of job titles for Manager's employees (including the Property Manager) who
shall be employed on-site in the direct management and operation of the
Property; (b) the respective titles and salary of each such position; (c)
whether each such position is full or part-time (and if part-time, the number of
hours they work per week); (d) the cost of salary, wages, and bonus that may be
charged to the Property for each such position; and (f) whether each such
position is bonded or covered under Manager's comprehensive crime insurance
policy. The Reimbursable Employee Expense Schedule shall also identify the
position of any employees of Manager who are not located at the Property but
whose salaries may be charged to the Property pro rata based upon services
actually rendered by such employees directly to the Property (in which event the
Reimbursable Employee Expense Schedule shall set forth the salaries of such
offsite positions and the maximum percentage thereof that may be charged to the
Property). In no event shall Manager be entitled to charge to the Property any
employee-related expenses: (i) except as specifically set forth on the
Reimbursable Employee Expense Schedule, that relate to general or supervising
management personnel, accountants or auditors; (ii) for which a separate fee is
charged by Manager pursuant to this Agreement or otherwise; or (iii) that are
not specifically set forth on the approved Reimbursable Employee Expense
Schedule. The expenses chargeable to the Property pursuant to the Reimbursable
Employee Expense Schedule may be modified from time to time only as

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part of the Approved Annual Business Plan or as otherwise approved by Owner in
writing, with such approval not to be unreasonably withheld or delayed.

         2.5      COMPLIANCE WITH LAWS, LICENSES, MORTGAGES, ETC.

                     (a) Manager will be responsible (at Owner's expense) for
            compliance with the Legal Requirements and Insurance Requirements.
            Manager, with the prior approval of Owner (and at Owner's expense),
            will promptly remedy any violation of any such requirements,
            provided that in the case of emergency, including imminent threat to
            the health, safety or welfare of tenants or any other person, or if
            so ordered by a governmental authority, Manager shall promptly
            remedy such violation, and notify Owner as soon as practical, and in
            any event no later than the end of the next Business Day. Manager
            shall notify Owner and recommend any repairs or changes to the
            Property or operation thereof which will be required under proposed
            changes in laws, ordinances and regulations. Notwithstanding the
            foregoing, Manager shall obtain Owner's prior written approval
            before engaging any legal counsel or commencing or appearing in any
            legal proceeding on behalf of Owner, other than with respect to
            legal action that may be necessary or desirable to collect rent
            and/or evict tenants delinquent in payment of monthly rental or
            other charges.

                     (b) Manager shall, at Owner's expense, obtain and maintain
            all Licenses. Manager shall provide Owner with copies of all
            completed initial or renewal License applications for Owner's prior
            approval and signature, if necessary, not less than thirty (30) days
            prior to the date such applications are due. All Licenses shall be
            obtained in Owner's name.

                     (c) Except as otherwise specifically directed by Owner,
            Manager shall use commercially reasonable efforts (at Owner's
            expense) to comply with all contracts and agreements relating to the
            Property, including any ground lease, space lease, covenant,
            condition and restriction, reciprocal easement agreement, and
            mortgage, deed of trust or other security instruments affecting the
            Property, provided that Manager has copies of such agreements.

                     (d) Manager shall, at Manager's individual,
            non-reimbursable expense, maintain its legal existence and good
            standing and obtain and maintain in effect all licenses and permits
            necessary or desirable to carry out its duties hereunder.

                     (e) Manager, shall, at Owner's expense, make commercially
            reasonable efforts to ensure that all employees and/or contractors
            who perform work at or for the Property have all required Licenses
            and comply with all Legal Requirements.

                     (f) Manager shall not knowingly permit the storage,
            disposal, transportation, abatement, or removal of Hazardous
            Materials under, at, on, about, to, from or

                                        8
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            affecting the Property except, in each case, in full compliance with
            Environmental Laws. Manager shall ensure that all Hazardous
            Materials, if any, used by Manager or permitted by Manager to be
            used at the Property are only in an amount necessary and customarily
            used by the tenants, or in connection with the operation, of
            residential apartment buildings. To the extent actually known to
            Manager, Manager shall give Owner prompt written notice of (i) any
            presence of Hazardous Materials at the Property other than as
            permitted in this SECTION 2.5(f), (ii) any release of Hazardous
            Materials at the Property, other than as permitted in this SECTION
            2.5(f), or (iii) any required or desirable clean-up or other
            remediation or any other condition respecting the Property and shall
            cooperate with and assist Owner in cleaning-up, remediating or
            otherwise resolving the problem. Manager shall comply with all
            Environmental Laws in managing the Property (and shall recommend to
            Owner any actions necessary on the part of Owner or Manager to
            ensure compliance with all Environmental Laws). Manager shall
            implement any special programs respecting compliance with
            Environmental Laws or respecting Environmental Liabilities
            established by Manager in its performance of its obligations under
            this Agreement and pursuant to reasonable and appropriate protocols
            established by Manager from time to time, as approved in advance by
            Owner, or as may be otherwise established by Owner or Owner's expert
            consultants at Owner's expense in accordance with the Approved
            Annual Business Plan. Owner shall have the right to attend all
            meetings with regulatory agencies concerning Environmental
            Liabilities affecting the Property, and Manager shall be responsible
            for consulting with Owner in making all decisions concerning
            responses to such regulatory agency activities.

                     (g) The Manager shall, at Owner's expense, if requested by
            Owner and to the extent necessary to protect the Property, implement
            and maintain an ongoing environmental auditing program reasonably
            satisfactory to Owner and any lender to Owner pursuant to which it
            shall conduct periodic investigations regarding the compliance of
            activities at the Property with applicable environmental laws, and
            the existence of and potential for contamination. The results of
            such environmental audit shall be provided to Owner. Without
            limiting the foregoing, Manager shall use commercially reasonable
            efforts to maintain and ensure compliance with all operations and
            maintenance manuals, programs and procedures with respect to all
            customary environmental issues, including but not limited to, mold,
            lead paint and asbestos, if any.

                     (h) Manager shall use commercially reasonable efforts to
            develop, document and adhere to an effective system of internal
            controls. Owner shall assist Manager in assessing the documentation
            and effectiveness of Owner's internal controls.

         2.6      SECURITY. Manager shall provide a written report to Owner, on
a monthly basis, documenting incidents which to the Manager's knowledge have
occurred on the Property (including, without limitation, calls to or visits by
local police and fire). Notwithstanding any other provision of this Agreement,
it is understood and agreed that Manager shall not, and does

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not, provide security services to the Property. Should Owner choose to do so,
Owner may direct that Manager, on Owner's behalf, separately contract with a
company (a "SECURITY COMPANY") providing alarm systems, patrol and similar
services ("SECURITY SERVICES"). Manager shall have no duty to supervise or
control performance of Security Services for any Security Company. However,
Manager shall evaluate Security Services on an on-going basis and notify Owner,
on a monthly basis, of the effectiveness of Security Services. Manager shall
promptly notify Owner of any incidents or conditions of which it has knowledge
which reflect on or affect the adequacy of the security provisions for the
Property, and shall make recommendations to Owner with respect to security
matters. Without limiting the provisions of SECTION 3.3(b), Owner shall
indemnify, defend, protect and hold Manager harmless for, from and against any
loss, liability, cost, expense, damage claim or cause of action, including,
without limitation, attorneys' fees, court costs and other litigation expenses
and costs, arising from any personal injury, loss of property or other matter
occurring on or about the Property, relating to the acts or omissions of a
Security Company, any claimed inadequacy of Security Services (except if such
claimed inadequacy is known to Manager and Manager fails to notify Owner of such
claimed inadequacy), the failure to provide Security Services or any other
matter relating to the security of the Property. The indemnification obligations
of Owner in this SECTION 2.6 shall survive the expiration or earlier termination
of this Agreement.

         2.7      ENERGY MANAGEMENT. Subject to the Approved Annual Business
Plan, Manager shall use commercially reasonable efforts to provide appropriate
energy management and shall utilize utility conservation techniques.

         2.8      ANNUAL BUSINESS PLAN.

                     (a) At least sixty (60) days prior to the end of each
            calendar year during the term of this Agreement, Manager shall
            prepare and submit to Owner for Owner's prior approval an annual
            business and leasing plan in accordance with the requirements of
            EXHIBIT D hereto (as such EXHIBIT D may be modified by Owner from
            time to time) (the "ANNUAL BUSINESS PLAN"). From the date of this
            Agreement until an Annual Business Plan is first approved by Owner,
            Manager shall operate under the Marketing Plan attached as Schedule
            4.5B to that certain Limited Partnership Agreement of BC Broadstone
            Preston, LP of even date herewith (the "JOINT VENTURE AGREEMENT").
            Owner shall approve or disapprove each Annual Business Plan within
            sixty (60) days after receipt. In the event that Owner disapproves
            an Annual Business Plan, Owner and Manager, within ninety (90) days
            of a notice of such disapproval to Manager, shall jointly prepare an
            Annual Business Plan, during which time the last Approved Annual
            Business Plan shall remain in effect. The Annual Business Plan shall
            be a comprehensive plan for the management, operation, leasing,
            repair, maintenance and promotion of the Property and for the other
            matters set forth on EXHIBIT D. It will include a 5 year capital
            plan. Manager shall consult Owner concerning the proposed Annual
            Business Plan and shall promptly incorporate therein such changes as
            Owner may direct. The Annual Business Plan, and all budgets
            contained therein, shall be in a

                                       10
<Page>

            form substantially consistent with the Reporting Package.
            Notwithstanding the foregoing, Manager shall use the Chart of
            Accounts.

                     (b) Manager shall: (i) perform its duties hereunder in
            accordance with the Approved Annual Business Plan; and (ii) use
            commercially reasonable efforts to ensure that the actual costs of
            maintaining and operating the Property do not exceed the operating
            budget (the "PROPERTY BUDGET") which is a part of the Approved
            Annual Business Plan either in total or in any one accounting
            category. All actual expenses must be charged to the proper account
            on a basis consistent with the Property Budget classifications and
            Reporting Package. No expense may be reclassified except as needed
            to correct an inadvertent error. Manager will secure Owner's prior
            approval for any expenditure that will result in a variance of the
            greater of $5,000 or 5% of the annual budgeted amount in any one
            accounting line item of the Property Budget except with respect to
            expenses relating to taxes, insurance or utilities or expenditures
            required due to emergencies that threaten life or property or could
            result in civil or criminal liability for Owner or Manager. Manager
            makes no guaranty, warranty or representation whatsoever in
            connection with the accuracy of any Property Budget or the other
            contents of the Annual Business Plan, and Owner acknowledges that
            they are intended as good faith estimates only. Owner shall have the
            right to require changes in the Approved Annual Business Plan from
            time to time; provided, however, that Owner shall provide Manager
            with at least fifteen (15) days' notice of such changes.

         2.9      SERVICE CONTRACTS.

                     (a) To the extent permitted by the Approved Annual Business
            Plan (so that, among other things, the expense thereof does not
            exceed the corresponding amount set forth in the Property Budget
            other than as set forth in Section 2.8(b)), and subject to SECTION
            2.11, Manager (without the prior consent of Owner) shall negotiate
            and enter into bona fide contracts with parties that are not
            Affiliates of Manager for terms no longer than one (1) year for
            electricity, gas, fuel, water, telephone, window cleaning, ash or
            rubbish hauling, vermin extermination, janitorial services,
            landscape maintenance and such other maintenance services for the
            Property as Manager shall reasonably determine to be advisable
            ("SERVICE CONTRACTS"). All Service Contracts: (i) shall be in the
            name of Manager as agent for Owner, (ii) shall be freely assignable,
            at Owner's option, to Owner's nominee, and (iii) shall be terminable
            by Owner, at Owner's election, upon no more than thirty (30) days'
            notice without penalty or premium. Each Service Contract shall
            provide that the service provider thereunder must obtain the
            insurance described in SECTION 3.4 hereof and must provide
            satisfactory evidence of such insurance to Manager except as
            approved by Owner. Unless Owner specifically waives such
            requirement, all Service Contracts shall be subject to bid every
            three (3) years or more frequently if deemed necessary by Owner.
            Notwithstanding the foregoing, Manager shall not, without the prior
            written consent of Owner, enter into any Service Contract unless
            provided for in the Approved Annual Business Plan.

                                       11
<Page>

                     (b) EXHIBIT E lists all Service Contracts in existence as
            of the date of this Agreement and, for each such contract,
            accurately sets forth the contract date, the name of the service
            provider, the nature of the service and the length and economic
            terms of the contract. Manager shall promptly update EXHIBIT E so
            that it at all times contains an accurate and complete description
            of Service Contracts affecting the Property.

         2.10     COLLECTION OF RENTS AND OTHER INCOME. Subject to SECTION
2.13(b), Manager will use commercially reasonable efforts to collect all rents
and other charges which may become due at any time from any tenant or from
others in connection with or for the use of the Property and will use
commercially reasonable efforts to ensure tenants' compliance with their
respective leases. Manager will commercially reasonable efforts to collect and
identify any income from miscellaneous services provided to tenants or the
public from parking income, furniture rental, cleaning services, tenant storage
and coin-operated machines of all types. All rents and other monies collected
will be deposited in the Operating Account. Manager will not write off any
income items in excess of $1,000 in the aggregate on an annual basis without
Owner's prior approval.

         2.11     COMPETITIVE BIDDING. All contracts for repairs, capital
improvements, goods and services will be awarded at no higher than prevailing
market rates and, as to amounts exceeding $5,000, will (unless otherwise
required or permitted by Owner) be awarded on the basis of competitive bidding
conducted in a manner satisfactory to Owner and in accordance with the Approved
Annual Business Plan.

         2.12     REPAIRS. Manager shall, at Owner's expense, make all ordinary
repairs, extraordinary repairs not exceeding $10,000, decorations and
alterations of the Property, subject to the limits of the Approved Annual
Business Plan. Manager shall not make expenditures for capital improvements
unless the same are specifically set forth in the Approved Annual Business Plan
or are otherwise approved by Owner. Manager may not make expenditures for any
repair which exceed $5,000 unless approved by Owner or specifically set forth in
the Approved Annual Business Plan; provided, however, Manager may make
expenditures for repairs without Owner's prior approval if it is necessary to
prevent imminent damage to the Property or the health or safety of any person on
or about the Property or if Owner or Manager is threatened with immediate
criminal or civil liability. Owner must be informed of any such expenditures as
quickly as possible, and in any event not later than the end of the next
Business Day.

         Manager shall provide regular and systematic inspections of the
buildings, building systems, grounds and parking areas in order to comply with
any requirements concerning the management or maintenance of the Property
imposed upon the Property or Owner by law, ordinance, or regulation of
governmental authority and shall promptly notify Owner in writing of any manner
in which the Property is not in compliance. An annual report on the condition of
the property together with a five (5) year capital plan shall be included in the
Annual Business Plan.

         At Owner's request, Manager shall coordinate any improvements,
alterations or building rehabilitation work approved by Owner in accordance with
the Capital Improvement Budget

                                       12
<Page>

attached as Schedule 4.3B to the Joint Venture Agreement (the "ALTERATIONS").
Manager shall oversee, manage and be responsible for all independent
contractors, suppliers and entities engaged, with the approval of Owner, for any
Alterations. All obligations and expenses incurred by Manager pursuant to its
authority as the Alterations coordinator shall be for the benefit of and at the
expense of Owner and Owner shall assume and pay any and all such expenses and
obligations. Owner shall pay a construction management fee (the "CONSTRUCTION
MANAGEMENT FEE") to Manager in an amount equal to 7.5% of the cost of the
Alternations, which shall be payable as a percentage applied against the cost
incurred for the Alterations.

         In regards to the Alterations, and in addition to the obligations set
forth in the preceding paragraph, Manager shall:

                     (a) Keep Owner advised generally as to developments
            affecting the Property and the Alterations prior to the commencement
            of the Alterations, such as local zoning, environmental and other
            governmental activities, and the progress in obtaining all of the
            permits, licenses and approvals required for the Alterations.

                     (b) Supervise the design and construction of the
            Alterations. Such supervision will include review of design
            alternatives, material selections, value engineering and the like.
            Without limiting the generality of the foregoing, Manager shall
            perform the following duties:

                         (i)    To the extent not completed as of the date
                  hereof, including renovation of the "clubhouse" on the
                  Property, develop with the project architect, if any (the
                  "ARCHITECT") and/or the project engineer, if any (the "PROJECT
                  ENGINEER") schematic designs for the Alterations to the end
                  that the preliminary drawings, specifications and cost
                  estimates approved by Owner will substantially conform to the
                  schematic design and cost concepts developed by Owner.

                         (ii)   To the extent not completed as of the date
                  hereof, including renovation of the "clubhouse" on the
                  Property, supervise the Architect and/or Engineer in the
                  development of the working drawings and specifications to the
                  end that these documents reflect in detail the schematic
                  designs and preliminary plans, specifications and cost
                  estimates approved by Owner.

                         (iii)  Review the plans and specifications with the
                  Architect, Engineer and contractors so as to (i) minimize
                  areas of possible conflict and overlapping jurisdictions among
                  the separate subcontractors on the job; and (ii) properly
                  assign and coordinate all phases of work for the Alterations.

                                       13
<Page>

                         (iv)   Review the specifications of the Alterations for
                  adequate provisions for all of the temporary facilities
                  necessary to enable contractors to perform their work and for
                  all of the job site facilities necessary to enable the
                  contractors and Owner to perform their duties in the
                  management, inspection and supervision of construction of the
                  Alterations.

                         (v)    Advise Owner whenever construction costs are
                  tending to exceed the estimated costs.

                         (vi)   Coordinate the overall administration of the
                  Alterations which shall include furnishing management and
                  technical personnel to attend staff conferences with Owner,
                  the architect, the engineer, the contractor or contractors,
                  other consultants and municipal officials. Manager shall
                  designate a project manager who shall provide sufficient time
                  to coordinate with other members of the on-site and office
                  staff.

                         (vii)  Administer all of Owner's contracts with the
                  Architect, Engineer, general contractor and suppliers and
                  materialmen, if any, and direct, together with the general
                  contractor, is any, administration of all the various
                  construction contracts for the Alterations.

                         (viii) Maintain a review function over the Architect
                  and general contractor, if any, with respect to approval and
                  revisions of working drawings, and technical and construction
                  inspections.

                         (ix)   Make final inspections of the Alterations with
                  the Architect and general contractor, if any, and prepare or
                  cause to be prepared and issue an exception report and process
                  all exception report items, warranties, guarantees, bonds and
                  other matters required with respect thereto and procure all
                  necessary operating and occupancy certificates and permits for
                  the use of the Alterations.

                         (x)    When requested by Owner, provide Owner, its
                  members, managers, consultants and representatives access to
                  any records, contracts, projections, schedules or other
                  information relating to Owner or the Alterations, arrange for
                  tours of the Alterations and keep such persons apprised as to
                  the progress of the Alterations and the performance by Manager
                  of its services hereunder as such persons may reasonably
                  request.

         2.13     LEASES.

                                       14
<Page>

                     (a) Manager shall use commercially reasonable efforts to
            cause the Property to be fully leased to desirable tenants in
            accordance with the Approved Annual Business Plan and, in
            connection, therewith, shall:

                          (i)   consult with Owner with respect to the rental
                  rates and renewal rates of space at the Property in
                  preparation of the Approved Annual Business Plan;

                          (ii)  use commercially reasonable efforts to obtain
                  and keep desirable tenants for the Property in accordance with
                  the Approved Annual Business Plan;

                          (iii) ensure the property is staffed during customary
                  business hours by Manager's leasing representatives;

                          (iv)  provide the full range of pro-active tenant
                  services customarily provided to tenants of first class
                  buildings similar to the Property, including: (1) regularly
                  scheduled tenant retention events with tenants using
                  designated tenant representatives as deemed necessary; (2)
                  prompt responses to all tenant complaints, inquiries and
                  requests; (3) periodic inspections of the Property; and (4)
                  maintenance of a tenant log that sets forth tenant complaints
                  and concerns and tracks the manner in which such complaints
                  and concerns are resolved;

                          (v)   subject to SECTION 2.13(b) below, use
                  commercially reasonable efforts to duly and punctually observe
                  and perform on Owner's behalf and, subject to the Approved
                  Annual Business Plan, at Owner's expense, all of Owner's
                  obligations under all leases, and to preserve and keep
                  unimpaired the rights of Owner and the obligations of tenants
                  under such leases; and

                          (vi)  subject to SECTION 2.13(b) below, promptly
                  enforce the obligations of tenants under leases and the
                  obligations of contractors, suppliers and similar third
                  parties providing services or goods to the Property.

                     (b) Without the consent of Owner, Manager: (i) shall not
            receive or collect any rents for more than one month in advance;
            (ii) shall not waive, excuse, condone, discount, set-off, compromise
            or in any manner release or discharge any tenant (or any guarantor
            under any guaranty of any lease) from its obligations under its
            lease (or such guaranty); (iii) shall not cancel, terminate or
            consent to the surrender of any lease; (iv) shall not commence any
            action, suit or proceedings for the collection of rent, for
            ejectment or for the dispossession of any tenant or exercise any
            right of recapture provided in any lease; (v) shall not modify or in
            any way alter the provisions of any lease; (vi) shall not relocate
            any tenant within the Property; (vii) shall not consent to any
            modification of the express purposes for which any tenant's premises
            have been leased; (viii) shall not consent to any subletting of any
            part of the Property, to any

                                       15
<Page>

            assignment of any lease by any tenant thereunder, or to any
            assignment or further subletting of any sublease; (ix) shall not
            permit any person to occupy space at the Property without a lease
            entered into in accordance with the terms of this Agreement; and (x)
            shall not retain any legal counsel or collection agency to act on
            behalf of Owner or Manager in connection with any lease of space at
            the Property. Notwithstanding the foregoing, if the Property
            consists of residential apartments, Manager may, without Owner's
            prior consent, enter into, modify, terminate and enforce residential
            leases, provided that all such actions shall be consistent with the
            Approved Annual Business Plan.

                     (c) Unless otherwise approved by Owner, all leases shall
            be: (i) on a standard form of lease approved by Owner; (ii) not be
            for a term longer than fourteen (14) months, (iii) prepared in
            accordance with leasing guidelines approved by Owner; and (iv)
            executed by Manager, as agent for Owner.

                     (d) Notwithstanding anything to the contrary contained in
            this Agreement, Manager shall not be entitled to any leasing
            commission, fee or other form of compensation, other than the
            Management Fee and Excess Management Fee, by reason of the leasing
            services performed by Manager under this Agreement.

                     (e) Manager shall meet with Owner from time to time as may
            be requested by Owner to advise Owner as to the status of the
            leasing activities for the Building and to apprise Owner of its
            marketing program and any alternative leasing. Manager shall assist
            Owner in connection with all matters and questions pertaining to its
            activities hereunder.

                     (f) In the performance of its obligations under this
            Agreement, Manager will comply with the provisions of any federal,
            state or local law prohibiting discrimination in housing on the
            basis of race, color, creed, handicap or national origin, including
            Title VI of the Civil Rights Act of 1964 (Public Law 88-352, 78
            Stat. 241), all requirements imposed by or pursuant to the
            Regulations of the Secretary (24 CFR, Subtitle A, Part I) issued
            pursuant to said Title VI, regulations issued pursuant to Executive
            Order 1063, and Title VIII of the Civil Rights Act. Manager shall
            not discriminate against any tenant or applicant for tenancy at the
            Property on the basis of race, creed, color, religion, sex, martial
            status, sexual orientation, or national origin.

         2.14     NOTICES TO OWNER. Manager shall promptly notify Owner in
writing if Manager becomes aware of any of the following:

                     (a) any default or alleged default by Owner under any
            lease;

                     (b) any litigation or potential litigation affecting the
            Property or Owner, or any litigation affecting Manager such that
            Manager could not reasonably be expected to fully perform its
            obligations under this Agreement;

                                       16
<Page>

                     (c) any casualty, loss, injury, claim or other event
            relating to the Property that might result in a claim under any
            applicable insurance policies;

                     (d) any actual or threatened condemnation of the Property
            or any portion thereof;

                     (e) any violation or alleged violation of any Legal
            Requirements or Insurance Requirements;

                     (f) any involuntary lien filed against the Property; and

                     (g) any material increases or decreases in costs, expenses
            or income not reflected in the Approved Annual Business Plan.

         2.15     PROPERTY TAX APPEALS. At the direction of, and with the
approval of, Owner, Manager shall engage a tax appeal professional, the cost of
such professional to be at Owner's expense, to annually review the tax
assessment for the Property in order to determine whether to appeal such
assessment and request an abatement.

         2.16     NO OTHER FEES. Notwithstanding anything to the contrary
contained in this Agreement, Manager shall not be entitled to any leasing
commission or other form of compensation, other than the Management Fee, the
Excess Management Fee and the Construction Management Fee, by reason of the
leasing, supervisory or other services performed by Manager under this
Agreement.

         2.17     REIT STATUS. Manager acknowledges that Owner has informed
Manager that an affiliate of Owner intends to qualify as a "real estate
investment trust" within the meaning of Section 856 ET SEQ of the Internal
Revenue Code of 1986, as amended (a "REIT"), and that such entity's ability to
qualify as a REIT will depend principally upon the nature of Owner's operations.
Accordingly, Manager agrees to use commercially reasonable efforts to operate
the Property in compliance with written guidance provided from time to time by
Owner to Manager to enable Owner's affiliate to qualify as a REIT under Section
856 ET SEQ of the Internal Revenue Code of 1986, as amended. In addition,
Manager agrees to provide such information, reports, audits, certificates, and
questionnaires as may be reasonably requested by Owner in connection with
qualification as a REIT and in connection with any and all filings by the REIT
with the Securities and Exchange Commission ("SEC") relating in whole or in part
to the Property.

                         ARTICLE 3. INSURANCE AND CLAIMS

         3.1      OWNER'S INSURANCE AND RIGHTS. Manager, as an operating expense
of the Property payable from the Operating Account, will obtain and keep in
force adequate property and commercial liability insurance covering Owner as
primary insured and, with respect to liability

                                       17
<Page>

insurance, Manager as additional insured, and otherwise in accordance with any
loan documents related to any financing to which Owner or the Property is
subject. Manager shall provide Owner with copies of policies or certificates of
insurance relating to the Property. Such insurance may be blanketed with other
insurance carried by Manager or any Affiliate of Manager, in which case a pro
rata share of the premiums will be chargeable to the Property as an operating
expense. Manager or Manager's insurer will have the exclusive right to conduct
the defense of any claim, demand or suit arising out of the ownership, operation
or management of the Property (chargeable as an operating expense of the
Property to the extent the insurance associated with such claim demand or suit
is chargeable to the Property). Nothing herein will be construed as indemnifying
Manager or its employees, contractors or agents against any act or omission for
which insurance protection is not available or is not required hereunder to be
carried by Owner and procured by Manager; neither is the foregoing intended to
affect the general requirement of this Agreement that the Property will be
managed, operated and maintained in a safe condition and in a proper and careful
manner. Owner will furnish whatever information is reasonably requested by
Manager for the purpose of placement of insurance coverages and will aid and
cooperate in every reasonable way with respect to such insurance and any claim
or loss thereunder. Owner will cooperate with Manager and Manager's insurance
carrier on loss control inspections, responding to recommendations and other
safety issues.

         3.2      Manager's Insurance. Manager will maintain (as an operating
expense of the Property with respect to on-site employees only) Workers'
Compensation and similar insurance as required by law. Manager shall maintain,
at Manager's expense, Commercial General Liability Insurance in favor of Owner,
in an amount not less than $2,000,000 in the general aggregate (per project),
$1,000,000 products and completed operations aggregate, $1,000,000 each
occurrence (combined single limit), $50,000 fire damage, and $5,000 medical
expenses, such insurance to cover hostile fire with no points of exclusion. In
addition, Manager shall maintain the following insurance at its own expense (not
chargeable to the Property):

                     (a) Employer's Liability - $500,000 each accident; $500,000
            disease - policy limit; $500,000 disease - each employee.

                     (b) Automobile Liability - As to any vehicle owned,
            non-owned or hired by Manager, $1,000,000 covering losses due to the
            insurer's liability for bodily injury or property damage.

                     (c) Medical Expenses - $5,000 per person per accident.

                     (d) Uninsured/Underinsured Motorists' Coverage for any
            owned car - $1,000,000.

                     (e) Comprehensive crime (including Employee Dishonesty)
            insurance with limits and terms acceptable to Owner or a fidelity
            bond acceptable to Owner.

                                       18
<Page>

                     (f) Excess Liability Coverage - $1,000,000 combined single
            limited for bodily injury and property damage each
            occurrence/$4,000,000 general aggregate.

         The minimum A.M. Best's rating of each insurer shall be A-VII. Manager
will furnish Owner with certificates of insurance simultaneously with the
execution of this Agreement and whenever coverage is renewed or replaced,
evidencing the aforesaid coverages, which will include provisions to the effect
that Owner will be given at least 30 days' prior written notice of cancellation
or non-renewal of or any material change in any of the aforesaid policies.
Owner, and any lender of Owner, if applicable, will be named as an additional
insured with respect to all insurance policies required under (b) and (d) above
and as loss payee as respects (c) above. All liability policies shall contain
endorsements that (i) delete any employee exclusion on personal injury coverage,
(ii) include employees as additional insureds and (iii) contain cross-liability,
waiver of subrogation and such other provisions as Owner may reasonably require.
Such insurance shall also include broad form contractual liability insurance
covering all of Manager's indemnification obligations under this Agreement.

         3.3      INDEMNIFICATION.

                     (a) Manager shall indemnify, hold harmless, protect and
            defend (with counsel approved by Owner) Owner Related Entities from
            and against all Damages in any manner related to, arising out of or
            resulting from:

                         (i)    any failure of Manager or Manager's agents,
                  servants or employees to perform their obligations under this
                  Agreement;

                         (ii)   any acts of Manager or Manager's agents,
                  servants or employees beyond the scope of its authority under
                  this Agreement; or

                         (iii)  any gross negligence or willful misconduct of
                  Manager or Manager's agents, servants or employees.

         If the circumstances or events described in clauses (i) through (iii)
above are covered by Owner's commercial general liability insurance, then
Manager's obligations under this SECTION 3.3 shall apply only to the extent
Owner's Damages are not fully paid by Owner's commercial general liability
insurance. Notwithstanding any other provisions of this Agreement to the
contrary, Manager's obligations under this SECTION 3.3 shall survive the
expiration, termination or cancellation of this Agreement.

                     (b) Subject to SECTION 16.19, Owner shall protect, defend,
            indemnify and hold harmless Manager from and against any and all
            Damages arising out of the performance by Manager of its obligations
            and duties hereunder in accordance with the terms hereof with
            respect to the Property; provided, however, that Owner does not
            hereby agree, and shall not be obligated, to so indemnify Manager
            from any Damages arising out of any act or omission of Manager or
            any of its agents, officers, employees

                                       19
<Page>

            or representatives, which act or omission constitutes gross
            negligence, willful misconduct, is in breach of this Agreement or is
            outside the scope of Manager's authority as provided herein or any
            Damages for which Manager is covered by insurance, or for which
            Manager would be covered by insurance if it maintained the insurance
            required by this Agreement. The indemnification by Owner contained
            in this Section 3.3(b) is in addition to any other indemnification
            obligations of Owner contained in this Agreement and shall survive
            the expiration or termination of this Agreement.

         3.4      CONTRACTORS' AND SUBCONTRACTORS' INSURANCE. Manager will
require that all parties performing work on or with respect to the Property,
including, contractors, subcontractors and service vendors, maintain insurance
coverage at such parties' expense, in the following minimum amounts:

                     (a) Workers' Compensation - Statutory amount.

                     (b) Employer's Liability - $500,000 each accident; $500,000
            disease-policy limit; $500,000 disease - each employee.

                     (c) Automobile Liability - $1,000,000 covering losses due
            to the insurer's liability for bodily injury or property damage.

                     (d) Medical Expenses - $5,000 per person per accident.

                     (e) Uninsured/Underinsured Motorists' Coverage- $1,000,000.

                     (f) Commercial General Liability: general aggregate -
            $2,000,000; products and comp/op aggregate - $1,000,000; each
            occurrence - $1,000,000; and fire damage - $50,000.

                     (g) Excess Liability Coverage - $5,000,000 or such greater
            amount as is needed for the specific job.

                     (h) Transit Coverage - As needed for the specific job.

         The minimum A.M. Best's rating of each insurer shall be A-VII. Manager
must obtain Owner's written permission to waive any of the above requirements.
Higher amounts may be required by Owner if the work to be performed is deemed by
Owner to be hazardous. Manager will obtain and keep on file a certificate of
insurance which shows that each such party is so insured. Owner, and any lender
of Owner, if applicable, will be named as an additional insured with respect to
Contractors' and Subcontractors' Auto Liability, Commercial General Liability
and Excess Liability policies. Manager must obtain indemnification and hold
harmless

                                       20
<Page>

provisions in favor of Owner and Manager from any vendor which provides or is
expected to provide more than $30,000 of services to the Property in the
aggregate on an annual basis.

         3.5      WAIVER OF SUBROGATION. Insofar as, and to the extent that, the
following provision may be effective without invalidating or making it
impossible to obtain insurance, Manager and Owner agree that with respect to any
hazard, liability, casualty or other loss or claim which is covered by insurance
then being carried by either Owner or Manager: (a) the party carrying such
insurance and suffering such loss releases the other party of and from any and
all claims with respect to such loss to the extent of the insurance proceeds
paid with respect thereto and specifically excepting from such release any
deductible required to be paid therewith; and (b) their respective insurance
companies shall have no right of subrogation against the other or their
respective agents, contractors, employees, licensees or invitees on account
thereof.

         3.6      SERVICE CONTRACTS. Manager shall use commercially reasonable
efforts to include in all Service Contracts provisions requiring the service
provider to indemnify, defend (with counsel approved by Owner), protect and hold
harmless Owner Related Entities from all Damages in any manner arising from or
related to the acts or omissions of such service provider or its employees,
agents or contractors.

         3.7      CLAIMS. Manager shall promptly investigate and make a full and
timely report to Owner of any casualty, accident, injury or other similar matter
affecting the Property. Manager shall also file such reports in a timely manner
to the applicable insurance carriers in accordance with the terms and conditions
of the relevant policies. Manager shall cooperate with and assist Owner and the
applicable insurance carrier in connection with the investigation and processing
of insurance claims affecting the Property.

                ARTICLE 4. FINANCIAL REPORTING AND RECORD KEEPING

         4.1      FINANCIAL CONTROLS. Manager shall use commercially reasonable
efforts to ensure such control over accounting and financial transactions as is
reasonably required to protect Owner's assets from theft, negligence or
fraudulent activity on the part of Manager's employees or other agents.
Uninsured losses arising from theft, negligence or fraud of Manager, its
employees or agents shall not be an operating expense of the Property.

         4.2      FINANCIAL REPORTS: GENERAL REQUIREMENTS. All financial reports
provided by Manager shall be subject to the following requirements:

                     (a) All reports shall be on Yardi and use the chart of
            accounts provided by Owner.

                                       21
<Page>

                     (b) All such reports shall comply with the terms of this
            Agreement, the Reporting Package and the Approved Annual Business
            Plan and shall be in such medium (e.g., computer disks or hard copy)
            as Owner may reasonably require;

                     (c) Manager will maintain, on Yardi, current data on rent
            rolls and financial and operating information;

                     (d) Monthly financial statements for the Property shall be
            closed or "cut-off" on the 20th day of each month;

                     (e) Unless Owner otherwise agrees, all reports shall be
            prepared in accordance with GAAP; Manager will ensure that books and
            records are prepared timely and accurately on an accrual basis in
            accordance with GAAP and presented in the format(s) required by
            Owner AS OF THE DATE SUCH REPORTS ARE DUE UNDER THIS AGREEMENT.

                     (f) All such reports shall be certified by Manager's
            property accountant; and

                     (g) Manager will ensure that depreciation and amortization
            have been recorded in accordance with Owner's capitalization policy
            attached hereto as EXHIBIT I.

                     (h) In the event of any conflict between the reporting
            requirements set forth in this Agreement and those required by the
            Reporting Package or the Approved Annual Business Plan, the
            Reporting Package or Approved Annual Business Plan, as applicable,
            shall control, except with respect to reports required by SECTION
            4.3. Owner may, upon not less than sixty (60) days' notice to
            Manager, make changes in or additions to the Reporting Package.
            Owner retains the right to modify such exhibits at any time
            immediately upon reasonable notice to the extent required to enable
            Owner and its affiliates to meet the reporting requirements of all
            regulatory authorities to which Owner and its affiliates may be
            subject.

                     (i) Manager will utilize Owner's Chart of Accounts attached
            hereto as EXHIBIT J.

         4.3      PERIODIC STATEMENTS.

                     (a) Weekly reports - No later than Tuesday of each week,
            Manager shall provide Owner with a weekly leasing report setting
            forth the information required by EXHIBIT H.

                     (b) Monthly reports - On or before the last business day of
            each month, for the current month, Manager shall provide Owner with
            a monthly statement setting forth the information required by
            EXHIBIT H as well as any additional information that

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            may be required by the Reporting Package or the Approved Annual
            Business Plan (the "MONTHLY STATEMENT").

                     (c) Quarterly Statements - No later than the last business
            day of each quarter, for the current quarter, Manager will provide
            to Owner, quarterly financial statements for the previous quarter as
            required by EXHIBIT H in the format requested by Owner.

                     (d) If requested by Owner, Manager shall submit quarterly
            re-projections of the budget no later than 15 days after the end of
            the quarter.

            Unless Owner otherwise agrees, Manager will ensure that books and
            records are prepared timely and accurately on an accrual basis in
            accordance with GAAP.

         4.4      SUPPORTING DOCUMENTATION. As additional support to the Monthly
Statements, Manager will, at Owner's request, provide copies of the following:

                     (a) A current leasing summary and detailed leasing activity
            report;

                     (b) An occupancy/leasing recap, including occupancy by unit
            type, actual versus budget occupancy, and economic occupancy;

                     (c) Detailed cash receipts and disbursements journals;

                     (d) General ledgers;

                     (e) Invoices for capital expenditures and nonrecurring
            items;

                     (f) Journal entries;

                     (g) Paid bills;

                     (h) Detailed trial balance (if available);

                     (i) Supporting documentation for payroll, payroll taxes and
            employee benefits;

                     (j) Supporting schedules for balance sheet accounts;

                     (k) A review and analysis of all recovery income accruals;

                     (l) All bank statements and reconciliations;

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                     (m) An aged accounts receivable listing and detailed
            allowance for doubtful accounts, with an explanation of all
            significant delinquencies and status of collection efforts and
            recommendations for write-off or reserves where appropriate;

                     (n) An accounts payable listing;

                     (o) A rent roll;

                     (p) A summary of any comparable projects within a three (3)
            mile radius of the Property for which Manager or any Affiliate of
            Manager provides leasing or management services or in which Manager
            or any Affiliate of Manager has a direct or indirect legal, economic
            or beneficial interest; and

                     (q) An annual inventory of personal property owned or
            leased in connection with the Property.

         4.5      ANNUAL FINANCIAL REPORTS. Manager shall cooperate with Owner's
accountants in the preparation of financial statements, state and federal tax
returns, and any related management or audit letters or similar reporting or
regulatory requirements applicable to Owner and its affiliates, including,
without limitation, in connection with qualifying as a REIT and as set forth in
EXHIBIT H. Such materials are to be issued no later than December 31st of each
calendar year or on such other schedule as Owner may reasonably require. At
Owner's request, Manager will engage an independent third party firm to audit
the annual records, as well as prepare partnership tax returns at Owner's
expense.

         4.6      TRANSFER OF FUNDS. On or before the fifth (5th) day of every
month, Manager will remit to Owner all cash balances derived from the rents or
otherwise arising from ownership, use or operation of the Property or the
provision of services at the Property, after deducting (a) an amount agreed to
by Owner for the Property's working capital, and (b) known expenditures that
will be paid between that date and the fifteenth (15th) day of the same month,
provided that the same are consistent with the approved Property Budget. The
amount so remitted will be delivered to Owner, independent of required financial
reports, in the most expeditious manner possible as directed by Owner. The
schedule for the transfer of funds and the balance permitted to remain in the
Operating Account may be changed from time to time by written instructions from
Owner. At Owner's option, the final monthly remittance will be net of the
Management Fee and Excess Management Fee.

         4.7      OWNER'S PROPERTY. All books, records, computer disks
containing Property information, invoices and other documents received and/or
maintained by Manager pursuant to this Agreement are and will remain the
property of Owner, and shall be made available to Owner at any time with
reasonable notice. Manager may retain a copy of such information but it shall be
kept confidential.

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<Page>

         4.8      BOOKS AND RECORDS. Manager shall maintain separate and
accurate books, records, files and accounts for the Property (collectively, the
"BOOKS AND RECORDS") in a good and orderly fashion. The Books and Records shall
be the exclusive property of Owner, shall be kept at the Property or at
Manager's Notice Address (or such other location as Owner may approve) and shall
include the following:

                     (a) Tenant files, including executed leases, lease
            abstracts, lease amendments, original insurance certificates,
            correspondence, and current rent rolls;

                     (b) Maintenance and repair files;

                     (c) Accounting books and records and supporting
            documentation;

                     (d) Construction files, competitive bid records, including
            site plans, as-built drawings, tenant space plans, construction
            specifications, and capital improvements schedules and information;

                     (e) Operation files, including HVAC maintenance schedules,
            warranties, and operation manuals;

                     (f) Service contracts, including cleaning, maintenance,
            landscaping, snow removal, trash removal, etc.;

                     (g) Permits and licenses ( including certificates of
            occupancy for all tenant spaces);

                     (h) Copies of insurance policies or certificates; and

                     (i) Such other information relating to the Property as
            Owner requests from time to time.

                        ARTICLE 5. OWNER'S RIGHT TO AUDIT

         5.1      RIGHT TO AUDIT. Owner will at all times during normal business
hours and with 24 hours prior written notice have the right to conduct audits
and examinations of, and to make copies of, the Books and Records, no matter
where such Books and Records are located. Such right may be exercised through
any agent or employee of Owner, or any certified public accountant designated by
Owner. Owner will also have the right to perform any and all additional audit
tests relating to Manager's activities either at the Property or at any office
of the Manager. Should Owner discover either weaknesses in internal control or
errors in record keeping, Manager will correct such discrepancies promptly upon
Owner's request and will

                                       25
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inform Owner, in writing, of the action taken to correct such audit
discrepancies. All audits conducted by Owner will be at the sole expense of
Owner.

                            ARTICLE 6. BANK ACCOUNTS

         6.1      OPERATING ACCOUNT. Manager will deposit all rents and other
funds collected from the operation of the Property in an interest-bearing
account established for the Property (the "OPERATING ACCOUNT") in a financial
institution approved by Owner. Manager shall take commercially reasonable
efforts to ensure that any such rents and other funds received by Manager on or
before 2:00 p.m. on a Business Day shall be deposited on that same day, and any
such rents or other funds received after 2:00 p.m. or on a day that is not a
Business Day shall be deposited on the next Business Day. Such account shall be
in the name of Owner and shall have such withdrawal restrictions as Owner's may
require. Owner will be given written notice of the account number and location
of the Operating Account. In accordance with ARTICLE 7, Manager will pay out of
the Operating Account the operating expenses of the Property and any other
payments relating to the Property required by the terms of this Agreement or set
forth in the Approved Annual Business Plan. If more than one account is required
to operate the Property, each account will have a distinct name.

         6.2      SECURITY DEPOSIT ACCOUNT. If required by Owner or law, tenant
security deposits will be deposited by Manager in a separate interest-bearing
account established in the name of Owner and at a financial institution approved
by Owner. Except to the extent prohibited by law or tenants' leases, all
interest earned on this account will be distributed to Owner on a monthly basis
as specified by SECTION 4.6. Manager agrees to handle all tenant security
deposits in accordance with all applicable laws and regulations and in
compliance with the leases of the Property.

         6.3      CHANGE OF BANKS. Owner may direct Manager to change any
depository bank or depository arrangement. Except with the prior written
approval of Owner, Manager shall not change any depository bank or arrangement
or other banking relationship or procedure.

         6.4      ACCESS TO ACCOUNT. Owner will have access to any and all funds
in the accounts described in SECTIONS 6.1 and 6.2. Upon notice of termination of
this Agreement, Manager's authority to draw against such accounts may be
terminated at any time by Owner without notice to Manager. No borrowing
authority shall be permitted on any accounts established on behalf of Owner. All
funds in such accounts shall be the exclusive property of Owner. Only such
personnel specifically designated by Manager and approved by Owner shall have
access to such accounts. All of Manager's personnel who have access to such
accounts shall be bonded and insured to the benefit of Owner against theft or
fraud. No accounts maintained pursuant to this Agreement shall contain funds
from any source other than the Property, and no such accounts shall be
commingled with the funds of Manager or any other person.

                                       26
<Page>

                         ARTICLE 7. PAYMENT OF EXPENSES

         7.1      COSTS ELIGIBLE FOR PAYMENT FROM OPERATING ACCOUNT. Subject to
the limitations of ARTICLE 2 (including SECTIONS 2.8(b) AND 2.12), SECTION 7.2
and the Approved Annual Business Plan, and except as otherwise directed by
Owner, the following expenses, to the extent incurred in accordance with this
Agreement and the Approved Annual Business Plan, shall be paid by Manager
directly from the Operating Account:

                     (a) Third-party debt service, payments due under any ground
            lease, real estate taxes, personal property taxes, betterment
            assessments and similar governmental charges properly due with
            respect to the Property;

                     (b) Costs of insurance maintained in accordance with
            SECTION 3.1;

                     (c) Costs to correct any violation of any Legal
            Requirements or Insurance Requirements;

                     (d) Actual costs of making all repairs, decorations and
            alterations and performing all maintenance and preventive
            maintenance with respect to the Property;

                     (e) Cost of collection of delinquent rentals collected
            through a collection agency in the ordinary course of business
            without the prior approval of Owner, so long as Manager and/or its
            affiliates are not the collection agency;

                     (f) Reasonable legal fees and expenses of attorneys
            incurred in the ordinary course of business in collecting delinquent
            receivables;

                     (g) Cost of capital expenditures;

                     (h) Leasing commissions and consultant fees payable to
            third parties approved by Owner;

                     (i) Amounts due under Service Contracts and cost of
            utilities (other than costs for which any tenant is directly
            responsible to the utility company);

                     (j) Cost of advertising;

                     (k) Cost of printed forms and supplies required for use at
            the Property;

                     (l) Cost of printed checks for each account required by
            Owner;

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<Page>

                     (m) Cost of salary and wages (including bonus payments,
            incentive compensation or other additional payments unless approved
            by Owner as set forth in the Approved Annual Business Plan), payroll
            taxes, insurance, worker's compensation and other benefits, all only
            as specifically set forth on the approved Reimbursable Employee
            Expense Schedule, but only to the extent that such costs relate to
            the period of such employees' employment in connection with the
            Property;

                     (n) The Management Fee, the Excess Management Fee and the
            Construction Management Fee (to the extent not paid through any
            capital reserve escrow established by the first mortgage lender of
            the Property); and

                     (o) Any other expenses included in the Approved Annual
            Business Plan.

         7.2      NON-REIMBURSABLE COSTS. Notwithstanding anything to the
contrary in this Agreement, the following expenses or costs incurred by or on
behalf of Manager in connection with the Property will, except as included in
the Approved Annual Business Plan, be at the sole cost and expense of Manager
and will not be reimbursed by Owner from the Operating Account or otherwise, and
Manager will indemnify and hold harmless Owner Related Entities from all
liability for the same:

                     (a) Cost of salary and wages, payroll taxes, insurance,
            worker's compensation and other benefits of Manager's management,
            accounting and office personnel not reimbursable under SECTION
            7.1(m);

                     (b) General accounting and reporting services which are
            within the scope of Manager's responsibilities to Owner under this
            Agreement;

                     (c) Cost of forms, papers, ledgers and other supplies,
            equipment, copying and telephone of any kind used in Manager's
            office at any location other than the Property;

                     (d) Cost of electronic data processing equipment, or any
            pro rata charge therefor, whether or not located at the Property, or
            for data processing provided by computer service companies;

                     (e)   Political or charitable contributions;

                     (f) Cost of advances made to employees and cost of travel
            by Manager's employees or agents to and from the Property;

                     (g) Costs attributable to gross negligence, willful
            misconduct or fraud on the part of Manager, Manager's associates or
            Manager's employees or agents, or arising from Manager's breach
            under this Agreement;

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<Page>

                     (h) Cost of comprehensive crime insurance or fidelity bonds
            purchased by Manager for its own account;

                     (i) Training expenses except for on-site employees;

                     (j) Employment and employment agency fees except for
            on-site employees;

                     (k) Advertising expenses of Manager not directly related to
            the Property; and

                     (l) Dues of Manager or any of its employees in professional
            organizations or the cost of any of Manager's employees
            participating in industry conventions, meetings or other functions
            unless attendance at such conventions is requested by Owner.

                      ARTICLE 8. INSUFFICIENT GROSS INCOME

         8.1      PRIORITIES. Manager shall promptly notify Owner if at any time
the gross income from the Property is or is expected to be insufficient to pay
the bills, charges and liabilities which may be incurred with respect to the
Property. In such event, unless Owner otherwise notifies Manager in writing,
expenses will be paid out of the Operating Account in the following order of
priority:

                     (a) FIRST: third-party debt service payments, ground lease
            payments, real estate taxes, personal property taxes, betterment
            assessments and any other charges and liabilities which could become
            a lien against or result in a forfeiture of the Property;

                     (b) SECOND: cost of salary and wages, payroll taxes,
            insurance, worker's compensation and other benefits of Manager's
            management, accounting and office personnel reimbursable under
            SECTION 7.1(m) as specifically set forth on the approved
            Reimbursable Employee Expense Schedule;

                     (c) THIRD: insurance premiums due in connection with
            insurance maintained in accordance with SECTION 3.1;

                     (d) FOURTH: bills and charges for utilities;

                     (e) FIFTH: other bills and charges of third parties, and
            any and all claims and demands of third parties and liabilities to
            third parties relating to the Property or the operation thereof
            which Owner in its discretion determines to pay from the Operating
            Account;

                                       29
<Page>

                     (f) SIXTH: bills and charges, if any, incurred by Manager
            for Manager's services provided to Owner exclusive of the Management
            Fee, the Excess Management Fee and any other fees due to Manager
            hereunder (if any); and

                     (g) SEVENTH: the Management Fee, the Excess Management Fee
            and other fees due Manager hereunder (if any).

         8.2      STATEMENT OF UNPAID ITEMS. Each month, after Manager has paid,
to the extent of available gross income, all bills and charges based upon the
ordered priorities set forth in SECTION 8.1, Manager will submit to Owner an
accounts payable listing that sets forth all remaining unpaid bills and their
due dates.

         8.3      SEGREGATION OF ACCOUNTS. If, pursuant to this Agreement,
Manager will manage more than one property, Manager will segregate the income
and expenses of each property so that, unless Owner directs Manager otherwise in
writing, gross income from each property will be applied only to the bills and
charges from such property.

         8.4      CASH FLOW FORECASTING. Manager will prepare a detailed cash
flow analysis sufficient to provide Owner with a forecast of account deficits.
Such forecasts will be updated monthly, or more frequently as dictated by field
conditions or as directed by Owner.

         8.5      MANAGER NOT OBLIGATED TO FUND. In no event shall Manager have
any obligation to advance any of its own funds in connection with the
performance of its obligations hereunder unless expressly so provided herein.
Unless Owner otherwise agrees in writing, Owner shall not be responsible for any
interest on funds advanced by Manager on Owner's behalf.

                    ARTICLE 9. SALE OR FINANCING OF PROPERTY

         9.1      COOPERATION WITH BROKER. If Owner executes a listing agreement
or other brokerage agreement with a broker (other than Manager) or an agreement
directly with a principal for the sale or financing of the Property, or any
other agreement relating to the transfer of ownership of the Property, Manager
will cooperate with such broker or principal to the end that the respective
activities of Manager and such broker or principal will be carried on without
friction and without interference with tenants and occupants. In connection with
any such sale, financing, or other transfer, Manager will:

                     (a) use commercially reasonable efforts to research and
            confirm the accuracy of any representations and warranties regarding
            the Property that are made by Owner without any representation or
            warranty relating thereto by Manager. Notwithstanding the foregoing,
            Manager shall certify that all rent rolls and/or financial
            statements provided to Owner are accurate and complete in all
            material respects;

                                       30
<Page>

                     (b) execute such consents, assignments, manager estoppels,
            back up certificates, and other documents as Owner may reasonably
            request, provided that such documents are in a form reasonably
            satisfactory to Manager and create no obligation of or liability to
            Manager;

                     (c) provide such other services as Owner may reasonably
            require; and

                     (d) permit the broker to show the Property (and any
            principal to view same) during reasonable business hours.

         9.2      NO SALES/BROKERAGE COMMISSIONS. Manager hereby acknowledges
and agrees that, unless it has been engaged by Owner pursuant to a separate
written agreement signed by Owner, Manager has not been engaged hereunder to
represent Owner in connection with any current or future sale, financing or
other transfer of the Property and has no authority to represent Owner in
connection therewith or right to any fee, commission or other form of
compensation in connection with sales, financings, or other transfers, provided
Manager, as part of its services hereunder, agrees to cooperate with Owner in
consummating such activities as set forth in SECTION 9.1.

                             ARTICLE 10. COOPERATION

         10.1     COOPERATION. Should any claims, demands, suits or other legal
proceedings be made or instituted by any person against or affecting Owner which
arise out of any of the matters relating to this Agreement or otherwise, Manager
shall notify Owner immediately upon becoming aware of same and Manager shall
give Owner all pertinent information possessed by Manager and reasonable
assistance in the defense or other disposition thereof.

                            ARTICLE 11. COMPENSATION

         11.1     COMPENSATION. Owner shall pay Manager, and Manager shall
accept as full compensation for Manager's service in managing the Property in
accordance with this Agreement, the Management Fee and the Excess Management
Fee. Manager will have no right to receive a Management Fee and the Excess
Management Fee after the expiration or earlier termination of this Agreement
except for fees earned through the termination date based on Rents received by
or on behalf of Owner before such expiration or earlier termination. Final
payment to Manager shall be due within three (3) Business Days of the date a
Final Accounting as set forth in SECTION 12.3 is received by Owner in a form
reasonably acceptable to Owner, and Manager's obligations under SECTION 12.4 are
satisfied. The Management Fee and Excess Management Fee for any partial month
shall be prorated based upon the number of days in such month.

                                       31
<Page>

         "RENTS" for the purpose of the Management Fee and the Excess Management
Fee computation will consist of all amounts actually received in cash for the
benefit of Owner from rental of space in the Property or provision of services
to tenants of the Property, including vending machine collections and other
forms of miscellaneous income relating to the leasing of the Property, except
that Rents shall NOT include:

         (1)      Security deposits (unless such deposits have been applied as
                  rental income upon termination of a lease), utility deposits
                  or other refundable sums;

         (2)      Funds received from tenants as reimbursement for utility
                  expenses paid by Owner;

         (3)      Rents paid in advance (including additional rent payments such
                  as real estate taxes and common area maintenance charges)
                  until the month in which such payments are applied as rental;

         (4)      Any interest or investment income;

         (5)      Any proceeds from a financing, refinancing, sale, exchange or
                  condemnation of all or any portion of the Property or any
                  other real or personal property associated therewith;

         (6)      The proceeds of any insurance, excluding rental loss or
                  business interruption insurance, and any other amounts paid to
                  Owner on account of fire or other casualty;

         (7)      Capital contributions or loans made to Owner; and

         (8)      Any trade discounts and/or rebates received in connection with
                  the operation and maintenance of the Property or purchase of
                  personal property associated therewith.

         Rents shall be adjusted from time to time to reflect any amounts
received as income from tenants which are subsequently reimbursed or credited to
tenants due to adjustments, and the Management Fee and Excess Management Fee
collected on account of such amounts shall be adjusted accordingly. Subject to
SECTION 8.1, Manager will pay the Management Fee and Excess Management Fee
monthly from the Operating Account. The Management Fee and the Excess Management
Fee for each month will be paid on the tenth (10th) day of such month.

                             ARTICLE 12. TERMINATION

         12.1     TERMINATION. The term of this Agreement will be for a period
of one (1) year and will be renewed automatically for successive periods of one
(1) year each, unless written notice of non-renewal is given by Owner to Manager
at least thirty (30) days prior to the end of the

                                       32
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then-existing term, or by Manager to Owner at least sixty (60) days prior to the
end of the then-existing term, provided that in the event of a breach by Owner
under this Agreement written notice may be given by Manager to Owner at least
thirty (30) days prior to the end of the then-existing term. Notwithstanding the
foregoing, and in addition to the provisions of SECTION 12.2, Owner may
terminate this Agreement: (a) for cause, immediately upon notice at any time, or
(b) without cause, by giving Manager at least thirty (30) days' prior notice in
writing, or (c) immediately upon payment by Owner to Manager of a termination
fee equal to one (1) month's Management Fee and Excess Management Fee (such
monthly fee to be determined by calculating the average monthly Management Fee
and Excess Management Fee over the prior 12-month period). Manager may terminate
this Agreement at any time with or without cause by giving Owner at least ninety
(90) days' prior notice in writing, and may terminate this Agreement upon sixty
(60) days' prior notice in writing in the event of a breach by Owner under this
Agreement; provided that if such breach is a failure to pay money, Manager may
terminate this Agreement upon thirty (30) days' prior notice in writing.

         12.2     TERMINATION WITHOUT NOTICE.

                     (a) Without limitation of Owner's rights under SECTION
            12.1, upon the occurrence of any one or more of the following
            events, at the sole election of Owner and without further notice to
            Manager, this Agreement will be deemed terminated: (i) dissolution
            or termination of the legal existence of Manager, whether by merger,
            consolidation or otherwise; (ii) termination or suspension of
            Manager's real estate brokerage license, if such license is required
            as a condition to the performance of Manager's duties hereunder;
            (iii) cessation on Manager's part to do business; (iv) failure of
            Manager to deal properly with and account for Owner's funds; or (v)
            the filing of proceedings by or against Manager or any general
            partner or parent corporation of Manager for bankruptcy, insolvency,
            reorganization or other relief of debtors, or any assignment for the
            benefit of the creditors of Manager.

                     (b) Without limiting Owner's rights under SECTION 12.1 or
            SUBSECTION (a) above, at Owner's sole election and with no less than
            thirty (30) days written notice by Owner to Manager, this Agreement
            shall terminate upon the occurrence of the following events with
            respect to the Property: (i) the sale or conveyance of the Property,
            whether by foreclosure, sale by deed-in-lieu of foreclosure, the
            assignment of Owner's ownership interest to any purchaser, lender or
            its designee, or otherwise; (ii) condemnation of the Property or
            such substantial portion of the Property that Owner determines that
            the remainder cannot be operated in a commercially reasonable
            manner; or (iii) the destruction of all of the improvements
            comprising such Property or such a substantial portion thereof that
            Owner determines that the remainder thereof cannot continue to be
            operated in a commercially reasonable manner, and Owner determines
            in its sole discretion not to rebuild the Property.

         12.3     FINAL ACCOUNTING. Upon termination of this Agreement, Manager
will deliver to Owner the following with respect to the Property ("FINAL
ACCOUNTING"):

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                     (a) A final accounting, reflecting the balance of income
            and expenses of the Property as of the date of termination or
            withdrawal, to be delivered within thirty (30) days after such
            termination;

                     (b) Any balance of any monies of Owner, prepaid rent or
            tenant security deposits, or both, held by Manager with respect to
            the Property, to be delivered immediately upon such termination; and

                     (c) The Books and Records and all other records, contracts,
            leases, tenant correspondence, files, receipts for deposits, unpaid
            bills and other papers, documents or computer disks or information
            which pertain in any way to the Property, to be delivered
            immediately upon such termination.

         12.4     OBLIGATION TO VACATE: ORDERLY TRANSITION. Upon termination of
this Agreement, Manager promptly will vacate any office space provided by Owner
for the location of Manager's personnel. Upon termination of this Agreement,
Manager will reasonably cooperate in order to effect an orderly transition of
the management functions to a new manager. Manager's obligations under SECTION
12.3 and this SECTION 12.4 will survive termination of this Agreement.

                     ARTICLE 13. SUBSIDIARIES AND AFFILIATES

         13.1     SUBSIDIARIES AND AFFILIATES. Any contract or lease of any kind
whatsoever between Manager and any Affiliate of Manager with respect to the
Property will be subject to the prior written approval of Owner, which approval
may be withheld at Owner's sole discretion.

                               ARTICLE 14. NOTICES

         14.1     NOTICES.

                     (a) All notices given hereunder shall be in writing and
            shall be delivered by hand, by nationally recognized overnight
            express delivery service (all charges prepaid) for next day delivery
            or by U.S. registered or certified mail, return receipt requested
            (all postage prepaid), addressed to Owner or Manager at Owner's
            Notice Address or Manager's Notice Address, respectively.

                     (b) Any notice or other communication sent or provided
            above shall be deemed given (i) on the date of delivery, if by hand
            or (ii) on the date mailed, if sent by overnight express delivery
            service or U.S. registered or certified mail. Such notice shall be
            deemed received on the date of receipt by the addressee or the date
            receipt would have been effectuated if delivery were not refused.
            Each party hereto may designate a new Notice Address by written
            notice to the other parties in accordance

                                       34
<Page>

            with this SECTION 14.1. The inability to deliver a notice because
            of a change of address of which proper notice was not given shall be
            deemed a refusal of such notice.

                ARTICLE 15. CERTAIN REPRESENTATIONS AND COVENANTS

         15.1     MANAGER REPRESENTATIONS. Manager hereby represents and
warrants to Owner as follows:

                     (a) Manager has all licenses, permits, authorizations and
            approvals necessary to allow it to enter into this Agreement and
            perform its duties hereunder; and

                     (b) Neither Manager nor, to the best of Manager's
            knowledge, after reasonable inquiry, any of its employees, has been
            convicted of robbery, extortion, embezzlement, fraud, grand larceny,
            burglary, arson, a felony drug offense, murder, rape, kidnapping,
            perjury, assault with intent to kill, a violation of the Employee
            Retirement Income Security Act of 1974 or any other felonies.

                            ARTICLE 16. MISCELLANEOUS

         16.1     WORD MEANINGS. Words such as "herein," "hereinafter," "hereof"
and "hereunder" when used in reference to this Agreement, refer to this
Agreement as a whole and not merely to a subdivision in which such words appear,
unless the context otherwise requires. The singular shall include the plural and
the masculine gender shall include the feminine and neuter, and vice versa,
unless the context otherwise requires. The word "including" shall not be
restrictive and shall be interpreted as if followed by the words "without
limitation."

         16.2     ASSIGNMENT. Without Owner's prior consent, which Owner may
withhold in its absolute discretion, Manager shall not transfer, assign,
subcontract or delegate its duties under this Agreement, and any attempted
transfer, assignment, subcontract or delegation without such consent shall be of
no force or effect. The services of Manager hereunder are personal in nature.

         16.3     BINDING PROVISIONS. Subject to SECTION 16.2, the covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
the heirs, legal representatives, successors and assigns of the respective
parties hereto.

         16.4     NONDISCRIMINATION. Manager will not discriminate against any
employee or applicant for employment by Manager on the basis of race, creed,
color, age, sex, martial status, sexual orientation, or national origin. Manager
will take affirmative action to insure that applicants are employed, and that
employees are treated during employment, without regard to their race, creed,
color, age, sex, martial status, sexual orientation, or national origin. Such
actions shall include, but not be limited to, the following: (i) employment,
upgrading, demotion or transfer; (ii) recruitment or recruitment advertising;
(iii) layoff or termination; (iv) rates of pay

                                       35
<Page>

or forms of compensation; and (v) selection for training, including
apprenticeship. Manager agrees to post in conspicuous places, available to
employees and applicants for employment, notices setting forth the provisions of
this SECTION 16.4.

         16.5     APPLICABLE LAW. The interpretation, construction and
enforceability of this Agreement shall be governed in all respects by the laws
of the state in which the Property is located without regard to any choice of
law principles. Any legal proceedings arising out of any of the transactions or
obligations contemplated by this Agreement may be brought in the state courts of
The Commonwealth of Massachusetts or the United States District Court for the
District of Massachusetts. The parties hereto irrevocably and unconditionally:
(a) submit to the jurisdiction of such courts and agree to take any and all
future action necessary to submit to such jurisdiction; (b) waive any objection
which they may now or hereafter have to the venue of any suit, action or
proceeding brought in such courts; and (c) waive any claim that any such suit,
action or proceeding brought in such court has been brought in an inconvenient
forum.

         16.6     SEVERABILITY OF PROVISIONS. The parties hereto intend and
believe that each provision in this Agreement comports with all applicable
local, state and federal laws and judicial decisions. If any provision in this
Agreement is, however, found by a court of law to be in violation of any
applicable local, state, or federal law, statute, ordinance, administrative or
judicial decision, or public policy, or if in any other respect such a court
declares any such provision to be illegal, invalid, unlawful, void or
unenforceable as written, then it is the intent of all parties hereto that,
consistent with and with a view towards preserving the economic and legal
arrangements among the parties hereto as expressed in this Agreement, such
provision shall be given force and effect to the fullest possible extent, and
that the remainder of this Agreement shall be construed as if such illegal,
invalid, unlawful, void, or unenforceable provision were not contained herein,
and that the rights, obligations, and interests of the parties under the
remainder of this Agreement shall continue in full force and effect. Each
provision of this Agreement shall be considered separable and if for any reason
any provision or provisions herein are determined to be invalid, unenforceable
or illegal under any existing or future law, such invalidity, unenforceability
or illegality shall not impair the operation of or affect those portions of this
Agreement which are valid, enforceable and legal.

         16.7     SECTION TITLES. Section titles are for descriptive purposes
only and shall not control or alter the meaning of this Agreement as set forth
in the text.

         16.8     FURTHER ASSURANCES. Manager and Owner shall execute and
deliver such further instruments and do such further acts and things as may
reasonably be required to carry out the intent and purposes of this Agreement.

         16.9     ENTIRE AGREEMENT. This Agreement and the Schedules and
Exhibits attached hereto constitute the entire agreement between the parties
hereto with respect to the transactions contemplated herein, and supersede all
prior understandings or agreements between the parties. All Exhibits and
Schedules are incorporated herein by reference and constitute a part of this
Agreement.

                                       36
<Page>

         16.10    WAIVER. The failure by any party hereto to insist upon or to
enforce any of its rights shall not constitute a waiver thereof, and nothing
shall constitute a waiver of such party's right to insist upon strict compliance
with the provisions hereof. No delay in exercising any right, power or remedy
created hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, power or remedy by any such party preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. No waiver by any party hereto to any breach of or default in any term or
condition of this Agreement shall constitute a waiver of or assent to any
succeeding breach of or default in the same or any other term or condition
hereof. Each party hereto may waive the benefit of any provision or condition
for its benefit contained in this Agreement, but only if such waiver is
evidenced by a writing signed by such party.

         16.11    AGREEMENT IN COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each of which shall be considered an original and all
shall constitute one and the same Agreement, binding upon all of the parties
hereto, notwithstanding that all of the parties may not be signatories to the
same counterpart.

         16.12    ATTORNEYS' FEES. In the event of a judicial or administrative
proceeding or action by one party against the other party with respect to the
interpretation or enforcement of this Agreement, the prevailing party shall be
entitled to recover reasonable costs and expenses including, without limitation,
reasonable attorneys' fees and expenses, whether at the investigative, pretrial,
trial or appellate level, and whether in any arbitration or bankruptcy
proceeding. The prevailing party shall be determined based upon an assessment of
which party's major arguments or positions prevailed.

         16.13    TIME PERIODS. In the event the time for performance of any
obligation hereunder expires on a day other than a Business Day, the time for
performance shall be extended to the next day which is a Business Day.

         16.14    MODIFICATION OF AGREEMENT. No modification of this Agreement
shall be deemed effective unless in writing and signed by all of the parties
hereto.

         16.15    TIME OF THE ESSENCE. Time is of the essence of this Agreement.

         16.16    CONSTRUCTION OF AGREEMENT. This Agreement shall not be
construed more strictly against one party than against the other merely by
virtue of the fact that it may have been prepared primarily by counsel for one
of the parties. No provision of this Agreement shall run to the benefit of or be
enforceable by any party other than the parties hereto and their permitted
successors or assigns.

         16.17    CONSENT AND APPROVALS. Owner's consents or approvals may be
given only in writing and only by representatives of Owner from time to time
designated in writing by Owner.

                                       37
<Page>

         16.18    USE OF OWNER'S NAME PROHIBITED. Without Owner's prior
approval, which Owner may withhold in its absolute discretion, Manager will not
use the name of Owner or any Owner Related Entity, or any derivation thereof, in
any manner whatsoever.

         16.19    EXCULPATION. Manager, and all persons claiming by, through or
under Manager, shall look solely to Owner's interest in the Property for the
satisfaction of any claim now existing or hereafter arising or accruing against
Owner, and in no event shall (a) Owner be liable for any deficiency or (b) any
other Owner Related Entity ever have any liability hereunder.

         16.20    CONFIDENTIALITY. Manager and its employees and agents agree to
keep all information related to the Property and Owner confidential, except to
the extent necessary to carry out Manager's obligations under this Agreement or
as may be required by law.

         16.21    NO JOINT VENTURE. Nothing in this Agreement or in the
performance of any obligations hereunder shall be deemed to create any
partnership, joint venture or similar relationship between Owner and Manager.

                     [Remainder of page intentionally blank]

                                       38
<Page>

                       PART III - MANAGER AS LEASING AGENT

         Owner and Manager further agree as follows, with the terms of this PART
III being deemed to supersede any inconsistent terms contained in PART II:

         1.       Owner hereby retains Manager as Owner's exclusive leasing
agent in connection with the Property. Manager represents and warrants to Owner
that Manager has all licenses and similar qualifications necessary to the
performance of its leasing services hereunder.

         2.       Manager will promptly provide Owner, upon a change in
personnel following the date of this Agreement, the names of the individuals who
shall have primary responsibility for Manager's leasing services hereunder,
which, when provided, shall be set forth on the schedule hereto entitled
"LEASING AGENT" (the "LEASING AGENTS").

         3.       In addition to its duties under PART II of this Agreement,
Manager shall use its reasonable commercial efforts to lease space at the
Property in accordance with the Approved Annual Business Plan. Manager shall
perform its leasing responsibilities hereunder in accordance with the standards
and practices of prudent and qualified leasing agents that act as leasing agents
for properties similar to the Property on behalf of institutional owners or
investors. Without limiting the generality of the foregoing, Manager's
responsibilities as leasing agent shall include the following: (a) subject to
the provisions of the Approved Annual Business Plan or as otherwise approved by
Owner, Manager shall, at Owner's expense, conduct such advertising, marketing
and promotion of the Property as is necessary for the successful leasing of the
Property as provided for in the Approved Annual Business Plan; (b) Manager shall
participate, at the direction of Owner, in lease negotiations; and (c) Manager
shall investigate the creditworthiness and desirability of all proposed tenants
and shall prepare a lease and tenant credit analysis for each proposed lease.

         4.       Manager shall always give priority to the leasing of space at
the Property that is at least equal to the priority given by Manager to any
property managed by Manager in the market that the Property is located. Manager
shall under no circumstances induce tenants of the Property to move to space at
any property managed by Manager.

         5.       Notwithstanding anything to the contrary in this Agreement,
unless otherwise approved by Owner, all leases of space at the Property shall be
on a standard form of lease approved by Owner.

         6.       Other than the Management Fee and Excess Management Fee,
Manager shall not receive any compensation for its leasing services.

         7.       If Owner is contacted directly by any prospective tenant of
the Property, Owner shall refer such tenant to Manager.

                                       39
<Page>

         Executed as an instrument under seal as of the day and year first
written above.

                         OWNER:

                         BC BROADSTONE PRESTON, LP, a
                         Delaware limited partnership

                              By:   Alliance G.P. IV, Inc., a Texas corporation,
                              its
                                    Managing General Partner

                                    By:
                                        -------------------------------
                                        Name:
                                        Title:

                         MANAGER:

                         Alliance Residential, LLC, an
                         Arizona limited liability company

                         By:
                               -----------------------------------------
                               Name:
                               Title:

                                       40<Page>

                                                                    Exhibit 10.2

                                 LOAN AGREEMENT

     This LOAN AGREEMENT (this "AGREEMENT") is dated as of this 15th day of
September, 2005 between and among WACHOVIA BANK, NATIONAL ASSOCIATION, a
national banking association with an office at One Boston Place, Boston,
Massachusetts (together with its successors and assigns, the "LENDER"), and
ALLTX, LLC, a Delaware limited liability company with an office at One Boston
Place, Boston, Massachusetts 02108, ("BORROWER").

     ARTICLE 1.   RECITALS;

     A.   Deutsche Bank Berkshire Mortgage, Inc. d/b/a DB Berkshire Mortgage,
Inc., as mortgage lender ("MORTGAGE LENDER") is making a loan in the principal
amount of $12,000,000.00 (the "MORTGAGE LOAN") to BC Broadstone Preston LP, a
Delaware limited partnership ("MORTGAGE BORROWER") as evidenced by that certain
Note dated as of the date hereof (together with all modifications, amendments,
supplements, extensions, renewals and consolidations the "MORTGAGE NOTE") made
by Mortgage Borrower to Mortgage Lender and secured by that certain Deed of
Trust, Security Agreement and Fixture Filing dated as of the date hereof (the
"MORTGAGE") by Mortgage Borrower in favor of the Mortgage Lender pursuant to
which Mortgage Borrower has granted Mortgage Lender a first priority mortgage
on, among other things, the real property as more fully described in the
Mortgage (the "PROJECT").

     B.   The Borrower collectively owns a portion of the membership interests
in the Mortgage Borrower and in order to consummate the acquisition of the
Project, the Lender has agreed to loan to the Borrower the amount of up to
$5,556,347.50 (the "LOAN") which shall be evidenced by a promissory note (as
amended, modified or supplemented from time to time, the "NOTE") in the original
principal amount of the Loan.

     C.   BCP Funding, LLC (the "GUARANTOR") shall guaranty repayment of the
Loan pursuant to the terms of that certain guaranty (as amended, modified or
supplemented from time to time, the "GUARANTEE") entered into contemporaneously
herewith.

     D.   ALLTX GP, LLC (the "GP") shall guaranty repayment of the Loan pursuant
to the terms of that certain guaranty (as amended, modified or supplemented from
time to time, the "GP GUARANTEE") entered into contemporaneously herewith

     D.   In addition to the Guarantee, in order to secure the repayment of the
Loan and the performance of all covenants, provisions and conditions of the Loan
Documents, the Borrower shall execute and deliver a Pledge and Security
Agreement (as amended, modified or supplemented from time to time, the "PLEDGE
AGREEMENT") with respect to the Borrower's membership interest in the Mortgage
Borrower.

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter contained, the parties hereto agree, and jointly and severally bind
themselves, as follows:

                                        1
<Page>

     ARTICLE 2.   DEFINED TERMS.

     Terms defined in the Recitals to this Agreement shall be used in this
Agreement as therein defined. The following terms shall be defined as follows:

     "AFFILIATE" shall mean, as to any Person, any other Person that either (i)
owns directly or indirectly twenty-five percent (25%) or more of all equity
interests in such Person, and/or (ii) is in control of, is controlled by or is
under common ownership or control with such Person and/or (iii) is a director or
officer of such Person or of an Affiliate of such Person, and/or (iv) is the
spouse, issue or parent of such Person or of an Affiliate of such Person. As
used in this definition, the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management,
policies or activities of such Person, whether through ownership of voting
securities, by contract or otherwise.

     "APPLICABLE LAW" shall mean as to any Person: (i) All statutes, rules,
regulations, orders, or other requirements having the force of law and (ii) all
court orders and injunctions, arbitrator's decisions, and/or similar rulings, in
each instance ((i) and (ii)) of or by any federal, state, municipal, and other
governmental authority, or court, tribunal, panel, or other body which has
jurisdiction over such Person, or any property of such Person, or of any other
Person for whose conduct such Person would be responsible.

     "AWARD" shall have the meaning provided in Section 7.1.17(c)(vi).

     "BANKRUPTCY CODE" shall mean Title 11 of the United States Code entitled
"BANKRUPTCY", as amended from time to time, and any successor statute or
statutes and all rules and regulations from time to time promulgated thereunder,
and any comparable foreign laws relating to bankruptcy, insolvency or creditors'
rights.

     "BCP LENDER" shall mean Arlington Street Re, Inc.

     "BCP LOAN" shall mean that certain $60,000,000 loan facility provided by
the BCP Lender to the Guarantor pursuant to that certain loan agreement dated
May 31, 2003 and all documents executed in connection therewith.

     "BUSINESS DAY" shall mean any day other than a Saturday, a Sunday or a
legal holiday on which national banks are not open for general business in the
Commonwealth of Massachusetts.

     "CAPITAL EXPENDITURES" for any period shall mean amounts expended for
replacements and alterations to the Project and required to be capitalized
according to GAAP, or other recognized method of accounting acceptable to
Lender.

     "CASUALTY" shall mean the occurrence of any casualty, damage or injury, by
fire or otherwise, to the Project or any part thereof.

     "CLOSING DATE" shall mean the date of funding the Loan.

     "CODE" shall mean the Internal Revenue Code of 1986, as amended, and as it
may be further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.

                                        2
<Page>

     "COLLATERAL" shall mean all collateral securing or intended to secure the
Obligations.

     "CONDEMNATION" shall mean a temporary or permanent taking by any
Governmental Authority as the result or in lieu or in anticipation of the
exercise of the right of condemnation or eminent domain, of all or any part of
the Project, or any interest therein or right accruing thereto, including any
right of access thereto or any change of grade affecting the Project or any part
thereof.

     "CONTROL" shall mean, with respect to any Person, the power to direct the
management and policies of such person, directly or indirectly, whether through
the ownership of voting securities or other beneficial interest, by contract or
otherwise. "Controlling" and "Controlled" shall have meanings correlative
thereto.

     "DEFAULT" shall mean the occurrence of any event hereunder or under any
other Loan Document which, but for the giving of notice or passage of time, or
both, would be an Event of Default.

     "ELIGIBLE ASSIGNEE" shall mean:

     (a)  a commercial bank organized under the laws of the United States, or
any State thereof, and having (i) total assets in excess of $1,000,000,000, and
(ii) a combined capital and surplus of at least $250,000,000;

     (b)  a commercial bank organized under the laws of any other country which
is a member of the Organization of Economic Cooperation and Development
("OECD"), or a political subdivision of any such country, and having (i) total
assets in excess of $1,000,000,000, and (ii) a combined capital and surplus of
at least $250,000,000, provided that such bank is acting through a branch or
agency located in the country in which it is organized or another country which
is also a member of the OECD;

     (c)  a life insurance company organized under the laws of any State of the
United States, or organized under the laws of any country and licensed as a life
insurer by any State within the United States and having (i) admitted assets of
at least $1,000,000,000 and (ii) claims paying ability of A+ as set forth in
Best's Ratings; and

     (d)  a nationally recognized investment banking company, or an Affiliate
thereof (expressly excluding any Person which is directly or indirectly an
Affiliate of Borrower, of Guarantor, of any member of Borrower, or of any
partner or member of Guarantor) organized under the laws of any State of the
United States, and licensed or qualified to conduct such business under the laws
of any such State and having (i) total assets of at least $1,000,000,000, (ii) a
net worth of at least $250,000,000.

     In each instance an Eligible Assignee must be subject to supervision or
regulation by the Comptroller of the Currency, any other United States bank or
securities regulatory agency, or the banking or insurance department of the
United States or any political subdivision thereof.

     "ENVIRONMENTAL LAWS" shall mean all Applicable Laws issued, promulgated or
entered into by or with any Governmental Authority, relating in any way to the
environment, preservation

                                        3
<Page>

or reclamation of natural resources, handling, treatment, storage, disposal,
release or threatened release of any Hazardous Material or to health and safety
matters.

     "ENVIRONMENTAL LIABILITY" shall mean any liability, contingent or otherwise
(including, without limitation, any liability for damages, natural resource
damage, costs of environmental remediation, administrative oversight costs,
fines, penalties or indemnities), of any Person directly or indirectly resulting
from or based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the Release or
threatened Release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.

     "FINANCING STATEMENTS" shall mean the UCC Financing Statement or UCC
Financing Statements naming Borrower, as debtor, and Lender, as secured party,
pertaining to the Collateral, and filed in the appropriate filing office or
offices required under applicable state law.

     "FISCAL YEAR" shall mean each twelve month period commencing on January 1
and ending on December 31 during each year of the Term.

     "GAAP" shall mean generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the accounting profession), or in such
other statements by such entity as may be in general use by significant segments
of the U.S. accounting profession.

     "GP" shall have the meaning provided in the Recitals to this Agreement.

     "GP GUARANTEE" shall have the meaning provided in the Recitals to this
Agreement.

     "GOVERNMENTAL AUTHORITY" shall mean any court, board, agency, commission,
office or authority of any nature whatsoever or any governmental unit (federal,
state, county, district, municipal, city or otherwise) whether now or hereafter
in existence.

     "GROSS REVENUES" shall mean all revenue derived from the ownership and
operation of the Project, from whatever source, including Rents.

     "GUARANTEE" shall have the meaning provided in the Recitals to this
Agreement.

     "GUARANTOR" shall have the meaning provided in the Recitals to this
Agreement.

     "HAZARDOUS MATERIALS" shall mean all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes,
mold, fungi or similar bacteria, and all other substances or wastes of any
nature regulated pursuant to any Environmental Law, including any material
listed as a hazardous substance under Section 101(14) of CERCLA.

                                        4
<Page>

     "IMPROVEMENTS" shall mean the buildings, structures, fixtures, additions,
enlargements, extensions, modifications, repairs, replacements and improvements
now or hereafter erected or located on the Project.

     "INDEBTEDNESS" shall mean, for any Person, without duplication: (i) all
indebtedness of such Person for borrowed money, for amounts drawn under a letter
of credit, or for the deferred purchase price of property for which such Person
or its assets is liable, (ii) all unfunded amounts under a loan agreement,
letter of credit, or other credit facility for which such Person would be liable
if such amounts were advanced thereunder, (iii) all amounts required to be paid
by such Person as a guaranteed payment to partners or a preferred or special
dividend, including any mandatory redemption of shares or interests, (iv) all
indebtedness guaranteed by such Person, directly or indirectly, (v) all
obligations under leases that constitute capital leases for which such Person is
liable, and (vi) all obligations of such Person under interest rate swaps, caps,
floors, collars and other interest hedge agreements, in each case whether such
Person is liable contingently or otherwise, as obligor, guarantor or otherwise,
or in respect of which obligations such Person otherwise assures a creditor
against loss.

     "INTERCREDITOR AGREEMENT" shall mean that certain Intercreditor Agreement
dated as of the date hereof between Lender and the Mortgage Lender, as the same
may be amended, modified or supplemented from time to time.

     "LEASE" shall mean any lease, sublease or sub-sublease, letting, license,
concession or other agreement (whether written or oral and whether now or
hereafter in effect) pursuant to which any Person is granted a possessory
interest in, or right to use or occupy all or any portion of any space in the
Project, and every modification, amendment or other agreement relating to such
lease, sublease, sub-sublease, or other agreement entered into in connection
with such lease, sublease, sub-sublease, or other agreement and every guarantee
of the performance and observance of the covenants, conditions and agreements to
be performed and observed by the other party thereto.

     "LEGAL REQUIREMENTS" shall mean all federal, state, county, municipal and
other governmental statutes, laws, rules, orders, regulations, ordinances,
judgments, decrees and injunctions of Governmental Authorities affecting any of
the Loan Parties or the Project or any part thereof or the construction, use,
alteration or operation thereof, or any part thereof, whether now or hereafter
enacted and in force, including the Americans with Disabilities Act of 1990, and
all permits, licenses and authorizations and regulations relating thereto, and
all covenants, agreements, restrictions and encumbrances contained in any
instruments, either of record or known to any of the Loan Parties, at any time
in force affecting the Collateral, the Project or any part thereof, including
any which may (i) require repairs, modifications or alterations in or to the
Project or any part thereof, or (ii) in any way limit the use and enjoyment
thereof.

     "LIEN" shall mean any mortgage, deed of trust, lien (statutory or
otherwise), pledge, hypothecation, easement, restrictive covenant, preference,
assignment, security interest, or any other encumbrance, charge or transfer of,
or any agreement to enter into or create any of the foregoing, on or affecting
(i) all or any portion of the Project or any interest therein, (ii) any direct
or indirect interest in any Loan Party or (iii) all or part of the Collateral,
including any conditional

                                        5
<Page>

sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, the filing of
any financing statement, and mechanic's, materialmen's and other similar liens
and encumbrances.

     "LOAN" shall have the meaning provided in the Recitals to this Agreement.

     "LOAN DOCUMENTS" shall mean, collectively, this Agreement, the Note, the
Guarantee, the GP Guarantee, the Security Documents and any other documents,
agreements and instruments now or hereafter evidencing, securing or delivered to
Lender in connection with the Loan, as the same may be (and each of the
foregoing defined terms shall refer to such documents as they may be) amended,
restated, replaced, supplemented or otherwise modified from time to time.

     "LOAN PARTY" shall mean the Borrower, the Guarantor, the GP and the
Mortgage Borrower.

     "MAJOR CONTRACT" shall mean (i) any management, brokerage or leasing
agreement or (ii) any cleaning, maintenance, service or other contract or
agreement of any kind (other than Leases) of a material nature (materiality for
these purposes to include contracts in excess of $25,000 or which extend beyond
one year (unless cancelable on thirty (30) days or less notice)), in either case
relating to the ownership, leasing, management, use, operation, maintenance,
repair or restoration of the Project or the Collateral, whether written or oral.

     "MATERIAL ADVERSE EFFECT" shall mean any event, fact, circumstance, change
in, or effect on, the operations, business, properties, condition (financial or
otherwise) or prospects of any Loan Party or on the Loan Parties taken as a
whole, which individually, in the aggregate or on a cumulative basis with any
other events, facts, circumstances, changes in, or effects on, such Loan Party
or the Loan Parties, taken as a whole, has had or could reasonably be expected
to have a materially adversely affect on (i) the ability of any Loan Party or
the Loan Parties, taken as a whole, to (A) operate or conduct business in all
material respects in the manner in which such business is operated or conducted
on the Closing Date, or (B) perform or pay any Obligations, (ii) the assets,
properties (including, without limitation, the Collateral and the Project),
business, prospects, profitability, operations, or condition (financial or
otherwise) of any Loan Party or the Loan Parties taken as a whole, (iii) the
validity or enforceability of this Agreement or any of the other Loan Documents
or any of the rights or remedies of the Lender hereunder or thereunder or (iv)
the value, enforceability, or collectibility of all or any material portion of
the Project or the Collateral. In determining whether any individual event would
result in a Material Adverse Effect, notwithstanding that such event in and of
itself does not have such effect, a Material Adverse Effect shall be deemed to
have occurred if the cumulative effect of such event and all other then existing
events would result in a Material Adverse Effect.

     "MATURITY DATE" shall mean the date on which the final payment of principal
of the Note becomes due and payable as therein provided, whether at the Stated
Maturity Date, by declaration of acceleration, or otherwise.

     "MAXIMUM LEGAL RATE" shall mean the maximum non-usurious interest rate, if
any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received on the Obligations and as provided for herein or
the other Loan Documents, under the laws of such

                                        6
<Page>

state or states whose laws are held by any court of competent jurisdiction to
govern the interest rate provisions of the Loan.

     "MONTHLY PAYMENT DATE" shall mean the twentieth (20th) day of every
calendar month occurring during the Term. The first Monthly Payment Date shall
be October 20, 2005.

     "MORTGAGE" shall have the meaning provided in the Recitals to this
Agreement.

     "MORTGAGE BORROWER" shall have the meaning provided in the Recitals to this
Agreement.

     "MORTGAGE LOAN" shall have the meaning provided in the Recitals to this
Agreement.

     "MORTGAGE LOAN DOCUMENTS" shall mean the Mortgage, the Mortgage Note and
all other documents, instruments and agreements executed and delivered in
connection with the Mortgage Loan.

     "MORTGAGE NOTE" shall have the meaning provided in the Recitals to this
Agreement.

     "NET OPERATING INCOME" shall mean for the applicable period, (i) Gross
Revenues minus (ii) Operating Expenses for such period. Net Operating Income
shall be calculated in a manner similar to the calculation pursuant to GAAP
except that the determination of Net Operating Income shall include current
obligations for accounts payable (due and payable during the current period).

     "NOTE" shall have the meaning provided in the Recitals to this Agreement.

     "OBLIGATIONS" shall mean (a) the principal of, and interest (including all
interest that accrues after the commencement of any case or proceeding by or
against any Loan Party under any federal or state bankruptcy, insolvency,
receivership or similar law) on the Loan, as and when due, whether at maturity,
by acceleration, upon one or more dates set for prepayment or otherwise and all
other monetary obligations, including fees, costs, expenses and indemnities,
whether primary, secondary, direct, contingent, fixed or otherwise, of the Loan
Parties to the Lender under this Agreement and the other Loan Documents, and (b)
the due and punctual payment and performance of all the covenants, agreements,
obligations and liabilities of each Loan Party under or pursuant to this
Agreement and the other Loan Documents, in each case now in existence or
hereafter created.

     "OFFICER'S CERTIFICATE" shall mean a certificate delivered to Lender by
Borrower which is signed by an authorized senior officer of Borrower.

     "OPERATING EXPENSES" shall mean, for any period, the aggregate amount of
expenses incurred by the Mortgage Borrower in connection with the Project
pursuant to arm's length transactions for ordinary and necessary expenses
sufficient to provide the amenities and services associated with a multi-family
residential facility as follows: labor costs; general maintenance; legal and
accounting fees relating solely to the operation of the Project (and not
partnership administration, other than audit and other expenses incurred by the
Mortgage Borrower relating solely to the operation of the Project); general and
administrative costs of the Mortgage Borrower directly attributable to the
Project (and not partnership administration) and advertising and marketing
costs; supplies for the Project; non-capital repairs and replacements; leasing
and brokerage commissions; management fees payable up to an amount equal to
three percent (3%) of

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Gross Revenues; costs of licenses, permits and similar fees relating to property
operations; premiums for insurance required pursuant to this Agreement and the
Mortgage Loan Documents; charges for electricity and other utilities; real
estate taxes, water and sewer rents and assessments; payments made into the
reserve funds as required by the Mortgage Loan Documents; and all other expenses
incurred in connection with the ordinary course of property operations and
maintenance. The foregoing expenses and fees paid to Affiliates of any Loan
Party shall be included as Operating Expenses in an amount equal to the actual
fees and expenses paid or payable to such Affiliate, but in no event greater
than amount that customarily would be paid to an unaffiliated third party on an
arm's-length basis for such services. Without limiting the generality of those
items which shall be excluded from the definition of Operating Expenses, the
following shall be specifically excluded from such calculation: depreciation,
amortization and other non-cash items; all gains and losses; all partnership
administrative expenses (including, without limitation, legal, accounting, and
other professional expenses related to partnership matters but not including
such expenses related to the operation of the Project); prepaid expenses which
are not customarily prepaid in the ordinary course of business; any termination
or similar fee in connection with financing for the Project; expenditures funded
by disbursements from any reserves; penalties, late fees and similar charges
arising from or on account of the Mortgage Borrower's failure to pay any
monetary obligations; any costs, expenses or fees, including interest, payable
by the Mortgage Borrower on advances made under the Mortgage Loan Documents.

     "PERMITTED ENCUMBRANCES" shall mean, collectively, (i) the Liens and
security interests created by the Loan Documents, (ii) all Liens and security
interests created by the Mortgage Loan Documents, (iii) Liens, if any, for Taxes
imposed by any Governmental Authority not yet due or delinquent, (iv) any
workers', mechanics' or similar Liens on the Project provided any such Lien is
discharged or bonded within 30 days after any Loan Party receives notice of such
Lien, and (v) such other title and survey exceptions as appear in the Title
Insurance Policy.

     "PERSON" shall mean any individual, corporation, partnership, limited
liability company, joint venture, estate, trust, unincorporated association, any
other entity, any federal, state, county or municipal government or any bureau,
department or agency thereof and any fiduciary acting in such capacity on behalf
of any of the foregoing.

     "PLEDGE AGREEMENT" shall have the meaning provided in the Recitals to this
Agreement.

     "PROJECT shall have the meaning provided in the Recitals to this Agreement.

     "REIT" shall mean Boston Capital Real Estate Investment Trust, Inc., a
Maryland corporation, which owns 100% of the membership interests in the
Borrower.

     "REIT LINE" shall mean the $60,000,000.00 line of credit provided by the
Guarantor to the REIT with a current outstanding principal balance of
$56,596,665.00.

     "RENTS" shall mean all rents, rent equivalents, moneys payable as damages
(including payments by reason of the rejection of a Lease in a Bankruptcy
proceeding) or in lieu of rent or rent equivalents, royalties (including all oil
and gas or other mineral royalties and bonuses), income, fees, receivables,
receipts, revenues, deposits (including security, utility and other deposits),
accounts, cash, issues, profits, charges for services rendered, and other
payment and

                                        8
<Page>

consideration of whatever form or nature received by or paid to or for the
account of or benefit of Mortgage Borrower, Borrower or any of their agents or
employees from any and all sources arising from or attributable to the Project
and the Improvements, including all receivables, customer obligations,
installment payment obligations and other obligations now existing or hereafter
arising or created out of the sale, lease, sublease, license, concession or
other grant of the right of the use and occupancy of the Project or rendering of
services by any Mortgage Borrower, Borrower, or any of their agents or employees
and proceeds, if any, from business interruption or other loss of income
insurance.

     "SECURITY DOCUMENTS" shall have the meaning provided in Article 4.

     "STATED MATURITY DATE" shall mean January 1, 2006.

     "SUBORDINATION AGREEMENT" shall mean that certain subordination agreement
of even date between the Lender, the Guarantor and the BCP Lender, wherein the
BCP Lender subordinated the BCP to the Loan upon the terms and conditions set
forth therein.

     "SURPLUS CASH" shall mean for the applicable period an amount equal to
distributions to Borrower pursuant to the Limited Partnership Agreement of
Mortgage Borrower dated on or about the date hereof.

     "TAXES" shall mean all real estate and personal property taxes,
assessments, water rates or sewer rents, now or hereafter levied or assessed or
imposed against the Project or part thereof, together with all interest and
penalties thereon.

     "TENANT" shall mean any Person obligated by contract or otherwise to pay
monies (including a percentage of gross income, revenue or profits) under any
Lease now or hereafter affecting all or any part of the Project.

     "TERM" shall mean the entire term of this Agreement, which shall expire
upon repayment in full of the Obligations and full performance of each and every
obligation to be performed by Loan Parties pursuant to the Loan Documents.

     "TITLE INSURANCE POLICY" shall mean the lender's title insurance policy
issued to Mortgage Lender in connection with the Mortgage Loan.

     "UCC" or "UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial Code
as in effect in the Commonwealth of Massachusetts.

     "U.S. OBLIGATIONS" shall mean direct full faith and credit obligations of
the United States of America that are not subject to prepayment, call or early
redemption.

     ARTICLE 3.   AGREEMENT TO LEND AND TO BORROW; REPAYMENT.

   3.1.    THE LOAN.

       3.1.1   Subject to the conditions and upon the terms herein provided, on
the date (the "CLOSING DATE") on which all the conditions to closing set forth
in Article 5 shall have been satisfied as determined by the Lender in its sole
discretion, the Lender agrees to lend to the Borrower, and the Borrower agree to
borrow from the Lender, the Loan.

                                        9
<Page>

       3.1.2   The Obligations are absolute and unconditional and shall not be
subject to any defense or any right of setoff, counterclaim or recoupment
arising out of any breach by the Lender of any obligation to any Loan Party,
whether hereunder or otherwise, or out of any indebtedness or liability at any
time owing to any Loan Party by the Lender and, until such time as all of the
Obligations shall have been fully paid in cash, each Loan Party shall perform
and observe all agreements contained in the Loan Documents and no Loan Party
shall terminate this Agreement for any cause, including, without limiting the
generality of the foregoing, the occurrence of any costs or circumstances that
may constitute failure of consideration, eviction or constructive eviction,
destruction of or damage to the Project, the taking by eminent domain of title
to or temporary use of any or all of the Project, commercial frustration of
purpose, any change in the tax or other laws of the United States of America or
of the Commonwealth of Massachusetts or any political subdivision of either
thereof or any failure of the Lender to perform and observe any agreement,
whether express or implied, or any duty, liability or obligation arising out of
or connected with the Loan Documents.

   3.2.    THE NOTE. The Loan shall be evidenced by the Note dated the date
hereof executed and delivered by the Borrower to the Lender in the original
principal amount of the Loan.

   3.3.    USE OF PROCEEDS. The proceeds of the Loan shall be used solely in
connection with the consummation of the acquisition and renovation of the
Project.

   3.4.    INTEREST.

       3.4.1   Interest on the outstanding principal balance of the Loan shall
accrue and be paid in accordance with the terms of the Note and this Agreement.

       3.4.2   This Agreement and the other Loan Documents are subject to the
express condition that at no time shall Borrower be required to pay interest on
the principal balance of the Loan at a rate which could subject Lender to either
civil or criminal liability as a result of being in excess of the Maximum Legal
Rate. If by the terms of this Agreement or the other Loan Documents, Borrower is
at any time required or obligated to pay interest on the principal balance due
hereunder at a rate in excess of the Maximum Legal Rate, the interest rate under
the Note or the default rate under the Note, as the case may be, shall be deemed
to be immediately reduced to the Maximum Legal Rate and all previous payments in
excess of the Maximum Legal Rate shall be deemed to have been payments in
reduction of principal and not on account of the interest due hereunder. All
sums paid or agreed to be paid to Lender for the use, forbearance, or detention
of the sums due under the Loan, shall, to the extent permitted by applicable
law, be amortized, prorated, allocated, and spread throughout the full stated
term of the Loan until payment in full so that the rate or amount of interest on
account of the Loan does not exceed the Maximum Legal Rate from time to time in
effect and applicable to the Loan for so long as the Loan is outstanding.

   3.5.    LOAN PAYMENTS.

       3.5.1   On each Monthly Payment Date, the Borrower shall make a payment
to Lender equal to one hundred percent (100%) of Surplus Cash, which such
payment shall be applied first

                                       10
<Page>

to all accrued and unpaid interest due under the Note and then to the principal
balance thereof; notwithstanding the foregoing, the failure of Borrower to make
a payment of all then accrued and unpaid interest under the Note on any Monthly
Payment Date shall be not an Event of Default in the event there is insufficient
Surplus Cash to make such payment in full. Any interest which is not so paid
hereunder shall accrue and be due and payable in full on the Maturity Date.

       3.5.2   The Loan is subject to a mandatory prepayment as provided in
Section 7.1.17(c)(vi). In addition, the proceeds of any Indebtedness incurred by
Borrower after the Closing Date shall be applied to repayment of the Loan
(PROVIDED, HOWEVER, that this sentence shall not be deemed to permit the
incurrence of any such Indebtedness by Borrower).

       3.5.3   The Borrower shall pay to Lender on the Maturity Date the
outstanding principal balance of the Loan, all accrued and unpaid interest and
all other amounts due hereunder and under the Note and the other Loan Documents.

       3.5.4   Any sums that otherwise would be payable to the Borrower or
distributable to the Borrower in connection with the refinancing or other payoff
of the Mortgage Loan permitted hereunder (including any refund of reserves on
deposit with Mortgage Lender) shall be immediately remitted by the Borrower to
Lender up to the amount necessary to fully repay the Loan including all interest
accrued to the date of prepayment and any other sums then due and payable by the
Loan Parties to Lender.

       3.5.5   Any amount borrowed and repaid hereunder in respect of the
Obligations may not be reborrowed.

     ARTICLE 4.   COLLATERAL.

     As security for the Obligations, the Borrower shall cause the following
documents, agreement and instruments (collectively, the "SECURITY DOCUMENTS") to
be executed and delivered on or before, and each dated as of, the Closing Date:

   4.1.    Guarantee;

   4.2.    Pledge Agreement;

   4.3.    Subordination Agreement;

   4.4.    UCC-1 financing statements and such other documents, instruments, or
agreements to create or perfect a security interest in the Collateral as Lender
may require.

     ARTICLE 5.   CONDITIONS PRECEDENT.

     It shall be a condition precedent of Lender's obligation to close and fund
the Loan that each of the following conditions precedent be satisfied in full
(as determined by Lender in its discretion), unless specifically waived in
writing by Lender at or prior to closing and funding the Loan:

   5.1.    Lender shall have received:

                                       11
<Page>

       5.1.1   from all parties thereto, a signed counterpart of this Agreement
and all other Loan Documents (which may include telecopy transmission of a
signed signature page);

       5.1.2   one or more favorable written opinion(s) (addressed to Lender and
dated the Closing Date) of counsel for the Loan Parties covering such matters
relating to the Loan Parties, the Loan Documents and the transactions
contemplated hereby and thereby as the Lender shall request. The Borrower hereby
request such counsel to deliver such opinion.

       5.1.3   charter documents and such other documents and certificates as
the Lender may reasonably request relating to the organization, existence and
good standing of the Loan Parties, the authorization of the transactions
contemplated by the Loan Documents and any other legal matters relating to the
Loan Parties, the Loan Documents, the Collateral, the Project and the
transactions contemplated thereby, all in form and substance satisfactory to the
Lender;

       5.1.4   evidence that the Security Documents create a valid and perfected
first priority lien on the Collateral and that all documents and instruments,
including Uniform Commercial Code financing statements and stock certificates
and powers executed in blank, required by law or requested by the Lender to be
filed, registered, recorded or delivered to Lender, as the case may be, to
create or perfect the first priority Liens intended to be created under the Loan
Documents, have been so filed, registered, recorded or delivered to the
satisfaction of the Lender;

       5.1.5   results of searches or other evidence reasonably satisfactory to
it (in each case dated as of a recent date satisfactory to the Lender)
indicating the absence of Liens on the assets of the Loan Parties, except for
Permitted Encumbrances and Liens for which termination statements and releases
or subordination agreements satisfactory to the Lender are being tendered
concurrently with such extension of credit;

       5.1.6   payment in full of all fees due at or immediately after the
Closing Date and all costs and expenses incurred by Lender in connection with
the establishment of the Loan (including the fees and expenses of counsel to the
Lender and the Lender's commitment fee of $15,000.00 each to be paid from the
proceeds of the Loan);

       5.1.7   copies of each of the Mortgage Loan Documents, including all
amendments and schedules thereto, each certified as true and correct by an
officer of the Borrower, and evidence that the Mortgage Loan Documents are each
in full force and effect and all consents, filings and approvals required by
Applicable Law in connection therewith shall have been obtained and made;

       5.1.8   such additional instruments and documents as the Lender may
reasonably require or request. Each of the Loan Documents shall be duly executed
and delivered and satisfactory in form, content and manner of execution and
delivery to Lender and its counsel.

   5.2.    All necessary consents and approvals to the transactions contemplated
hereby shall have been obtained and shall be satisfactory to the Lender.

                                       12
<Page>

   5.3.    The Lender shall be satisfied that any financial statements delivered
to it fairly present the business and financial condition of the Loan Parties
and that there has been no material adverse change since the date of the most
recent financial information delivered to the Lender in any Loan Party's
operations, business, properties, condition (financial or otherwise) or
prospects.

   5.4.    There shall not be pending any litigation or other proceeding, the
result of which could reasonably be expected to have a Material Adverse Effect,
and there shall not have occurred any default of any material contract or
agreement of any Loan Party which could reasonably be expected to have a have a
material adverse effect on any Loan Party's operations, business, properties,
condition (financial or otherwise) or prospects.

   5.5.    The representations and warranties made by the Loan Parties in the
Loan Documents and otherwise, and by the Mortgage Borrower and other Loan
Parties in the Mortgage Loan Documents, shall be true and complete and no
Default or Event of Default shall exist and no default or event of default shall
exist under the Mortgage Loan Documents.

   5.6.    The consummation of the transactions contemplated hereby shall not
(i) violate any Applicable Law or any charter document or (ii) conflict with, or
result in a default or event of default under, any Mortgage Loan Document or any
material agreement of any Loan Party. No event shall exist which is, or solely
with the passage of time, the giving of notice or both, would be a default under
any Mortgage Loan Document or any material agreement of any Loan Party.

   5.7.    No material changes in governmental regulations or policies affecting
any Loan Party or Lender shall have occurred prior to the Closing Date.

     ARTICLE 6.   REPRESENTATIONS AND WARRANTIES.

     The Borrower represent and warrant that (as to the Mortgage Borrower and
the Project, to the best of Borrower's knowledge) as of the Closing Date and so
long as any of the Obligations are outstanding:

   6.1.    ORGANIZATION. Each Loan Party which is an entity is duly organized,
validly existing and in good standing with full power and authority to own its
assets and conduct its business, and is duly qualified in all jurisdictions in
which the ownership or lease of its property or the conduct of its business
requires such qualification, except where the failure to be so qualified would
not have a Material Adverse Effect, and each Loan Party has taken all necessary
action to authorize the execution, delivery and performance of this Agreement
and the other Loan Documents by it, and has the power and authority to execute,
deliver and perform under this Agreement, the other Loan Documents and all the
transactions contemplated hereby.

   6.2.    PROCEEDINGS. The Loan Documents have been duly authorized, executed
and delivered by each applicable Loan Party and constitute a legal, valid and
binding obligation of such Loan Party, enforceable against such Loan Party in
accordance with their respective terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally, and by

                                       13
<Page>

general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

   6.3.    NO CONFLICTS. The execution and delivery of the Loan Documents by the
applicable Loan Party and the performance of its obligations hereunder and
thereunder will not conflict with any provision of any law or regulation to
which such Loan Party is subject, or conflict with, result in a breach of, or
constitute a default under, any of the terms, conditions or provisions of any of
such Loan Party's organizational documents or any agreement or instrument to
which such Loan Party is a party or by which it is bound, or any Mortgage Loan
Document, or any order or decree applicable to such Loan Party, or result in the
creation or imposition of any Lien on any of such Loan Party's assets or
property (other than pursuant to the Mortgage Loan Documents or the Loan
Documents).

   6.4.    LITIGATION. There is no action, suit, proceeding or investigation
pending or, to Borrower' knowledge, threatened against, any Loan Party, the
Collateral or the Project in any court or by or before any other Governmental
Authority which, if adversely determined, might have a Material Adverse Effect.

   6.5.    FINANCIAL INFORMATION. All financial data, including the statements
of cash flow and income and operating expense, that have been delivered to
Lender in respect of the Loan Parties and the Project (i) are true, complete and
correct in all material respects, (ii) accurately represent the financial
condition of the Loan Parties and the Project as of the date of such reports,
and (iii) have been prepared in accordance with GAAP throughout the periods
covered, except as disclosed therein. No Loan Party has any contingent
liabilities, liabilities for taxes, unusual forward or long-term commitments or
unrealized or anticipated losses from any unfavorable commitments that are known
to the Borrower and reasonably likely to have a Material Adverse Effect, except
as referred to or reflected in said financial statements. Since the date of the
financial statements, there has been no occurrence with respect to any Loan
Party or the Project which could have a Material Adverse Effect.

   6.6.    ENVIRONMENTAL LAW. No Loan Party (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become subject to
any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental Liability or (iv) knows of any basis for any Environmental
Liability, which, in each case, could reasonably be expected to result in a
Material Adverse Effect.

   6.7.    AGREEMENTS.

       6.7.1   No Loan Party is in default with respect to any order or decree
of any court or any order, regulation or demand of any Governmental Authority,
which default might have a Material Adverse Effect. No Loan Party is in default
in any material respect in the performance, observance or fulfillment of any of
the obligations, covenants or conditions contained in any Permitted Encumbrance.

       6.7.2   The Mortgage Loan Documents have been validly authorized and
executed by the Loan Parties thereunder.

                                       14
<Page>

   6.8.    CONSENTS. No consent, approval, authorization or order of any court
or Governmental Authority is required for the execution, delivery and
performance by any Loan Party of, or compliance by any Loan Party with, the Loan
Documents, Mortgage Loan Documents, or the consummation of the transactions
contemplated hereby, other than those which have been obtained.

   6.9.    NO PLAN ASSETS. As of the date hereof and throughout the Term (i) no
Loan Party is and none will be an "employee benefit plan," as defined in Section
3(3) of ERISA, subject to Title I of ERISA, (ii) none of the assets of any Loan
Party constitutes or will constitute "plan assets" of one or more such plans
within the meaning of 29 C.F.R. Section 2510.3-101, (iii) no Loan Party is or
will be a "governmental plan" within the meaning of Section 3(32) of ERISA, and
(iv) transactions by or with any Loan Party are not and will not be subject to
state statutes regulating investment of, and fiduciary obligations with respect
to, governmental plans.

   6.10.   TAX FILINGS. Each Loan Party has filed (or has obtained effective
extensions for filing) all federal, state and local tax returns required to be
filed and has paid or made adequate provision for the payment of all federal,
state and local taxes, charges and assessments payable by such Loan Party. Each
Borrower believes that the tax returns (if any) of each Loan Party properly
reflect the income and taxes of such Loan Party for the periods covered thereby,
subject only to reasonable adjustments required by the Internal Revenue Service
or other applicable tax authority upon audit.

   6.11.   SOLVENCY. (i) No Loan Party has entered into the transactions
contemplated hereby or any Loan Document with the actual intent to hinder,
delay, or defraud any creditor and (ii) each Loan Party has received reasonably
equivalent value in exchange for its obligations under the Loan Documents.
Giving effect to the Loan, the fair saleable value of each Loan Party's assets
exceeds and will, immediately following the making of the Loan, exceed such Loan
Party's total liabilities, including subordinated, unliquidated, disputed and
contingent liabilities. The fair saleable value of each Loan Party's assets is
and will, immediately following the making of the Loan, be greater than such
Loan Party's probable liabilities, including the maximum amount of its
contingent liabilities on its debts as such debts become absolute and matured.
No Loan Party's assets constitute or, immediately following the making of the
Loan, shall constitute, unreasonably small capital to carry out its business as
conducted or as proposed to be conducted. No Loan Party intends to, and none
believes that it will, incur Indebtedness and liabilities (including contingent
liabilities and other commitments) beyond its ability to pay such Indebtedness
and liabilities as they mature (taking into account the timing and amounts of
cash to be received by such Loan Party and the amounts to be payable on or in
respect of obligations of such Loan Party).

   6.12.   FEDERAL LAWS. No part of the proceeds of the Loan will be used for
the purpose of purchasing or acquiring any "margin stock" within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System or for any
other purpose which would be inconsistent with such Regulation U or any other
Regulations of such Board of Governors, or for any purposes prohibited by Legal
Requirements or by the terms and conditions of this Agreement or the other Loan
Documents. No Loan Party is (i) a "bank holding company" or a direct or indirect
subsidiary of a "bank holding company" as defined in the Bank Holding Company
Act of 1956,

                                       15
<Page>

as amended, and Regulation Y thereunder of the Board of Governors of the Federal
Reserve System, (ii) a "foreign person" within the meaning of Sections 1445 or
7701 of the Code, (iii) a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of either a "holding company" or a
"$", all as defined in the Public Utility Holding Company Act
of 1935, as amended, (iv) an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company Act of
1940, as amended, or (v) subject to any other United States federal or state law
or regulation which purports to restrict or regulate its ability to borrow
money.

   6.13.   FISCAL YEAR. Each fiscal year of Borrower commences on January 1.

   6.14.   NO OTHER FINANCING. Borrower has no Indebtedness other than the
Obligations, the Mortgage Borrower has no Indebtedness other than under the
Mortgage Loan Documents, and the Guarantor has no other Indebtedness other than
under the BCP Loan.

   6.15.   CONTRACTS. Each of the Major Contracts is in full force and effect,
there are no monetary or other material defaults by any Loan Party thereunder
and, to the best knowledge of Borrower, there are no monetary or other material
defaults thereunder by any other party thereto. Neither any of the Loan Parties
nor any other Person acting on any Loan Party's behalf has given or received any
notice of default under any of the Major Contracts that remains uncured or in
dispute.

   6.16.   FULL AND ACCURATE DISCLOSURE. No statement of fact made by any Loan
Party in this Agreement or in any of the other Loan Documents contains any
untrue statement of a material fact or omits to state any material fact
necessary to make statements contained herein or therein not misleading. There
is no material fact presently known to any Loan Party which has not been
disclosed to Lender which adversely affects, nor as far as either Borrower can
foresee, might adversely affect, the Collateral, the Project or the business,
operations or condition (financial or otherwise) of any Loan Party, other than
with regard to market risk inherent in projecting future operations.

   6.17.   MORTGAGE LOAN. Simultaneous with the funding of the Loan, the
Mortgage Loan will have been funded in the amount of $12,000,000.00, with $0
remaining to be advanced thereunder. No default, breach, violation or event of
default has occurred under the Mortgage Loan Documents which remains uncured or
unwaived and no circumstances, event or condition has occurred or exists which,
with the giving of notice and/or the expiration of the applicable period would
constitute an event of default under the Mortgage Loan Documents. Each and every
representation and warranty made to Mortgage Lender by Mortgage Borrower and
each Loan Party contained in any one or more of the Mortgage Loan Documents is
true, correct, complete and accurate in all material respects as of the date
hereof.

   6.18.   ENFORCEABILITY. The Loan Documents are not subject to any right of
rescission, set-off, counterclaim or defense by any Loan Party, including the
defense of usury, nor would the operation of any of the terms of the Loan
Documents, or the exercise of any right thereunder, render the Loan Documents
unenforceable, and no Loan Party has asserted any right of rescission, set-off,
counterclaim or defense with respect thereto.

                                       16
<Page>

   6.19.   INSURANCE. The Mortgage Borrower shall maintain at all times the
insurance required under the Mortgage Loan Documents. No claims have been made
under any of the insurance policies, and no Person has done, by act or omission,
anything which would impair the coverage of any of the insurance policies.

   6.20.   LICENSES. All permits and approvals, including without limitation,
certificates of occupancy required by any Governmental Authority for the use,
occupancy and operation of the Project in the manner in which the Project is
currently being used, occupied and operated have been obtained and are in full
force and effect.

   6.21.   FILING AND RECORDING TAXES. All transfer taxes, deed stamps,
intangible taxes, mortgage, mortgage recording, stamp, intangible or other
similar tax required to be paid under applicable Legal Requirements in
connection with the execution, delivery, recordation, filing, registration,
perfection or enforcement of any of the Loan Documents and the Mortgage Loan
Documents have been paid or are being paid simultaneously herewith. All taxes
and governmental assessments due and owing in respect of the Project have been
paid, or an escrow of funds in an amount sufficient to cover such payments has
been established pursuant to the Mortgage Loan Documents, by this Agreement or
are insured against by the Title Insurance Policy.

   6.22.   THE PROJECT.

       6.22.1  Mortgage Borrower has good, marketable and insurable fee simple
title to the real property comprising part of the Project and good title to the
balance of the Project owned by it, free and clear of all Liens whatsoever
except the Permitted Encumbrances. None of the Permitted Encumbrances,
individually or in the aggregate, materially and adversely affect the value of
the Project, impair the use or operations of the Project or impair any Loan
Party's ability to pay its obligations in a timely manner.

       6.22.2  The Project and the use thereof comply with all applicable Legal
Requirements. No Loan Party has received any notice of any violation of any of
the foregoing. No Loan Party is in default or violation of any order, writ,
injunction, decree or demand of any Governmental Authority, the violation of
which might have a Material Adverse Effect. No Loan Party has committed any act
which may give any Governmental Authority the right to cause such Loan Party to
forfeit the Project, the Collateral or any part thereof or any monies paid in
performance of any Loan Party's obligations under any of the Loan Documents. The
Project is used exclusively for multi-family apartments and other appurtenant
and related uses and all permits, certifications, licenses, and approvals
required for the legal use, occupancy and operation of the Project have been
obtained and are in full force and effect. No legal proceedings are pending or,
to the knowledge of Borrower, threatened with respect to the zoning of the
Project. Neither the zoning nor any other right to construct, use or operate the
Project is in any way dependent upon or related to any property other than the
Project. The use being made of the Project is in conformity with the certificate
of occupancy issued for the Project and all other restrictions, covenants and
conditions affecting the Project.

                                       17
<Page>

       6.22.3  No Condemnation or other proceeding has been commenced or, to
Borrower' knowledge, is contemplated with respect to all or any portion of the
Project or for the relocation of roadways providing access to the Project.

       6.22.4  All easements, cross easements, licenses, air rights and
rights-of-way or other similar property interests (collectively, "EASEMENTS"),
if any, necessary for the full utilization of the Improvements for their
intended purposes have been obtained, are described in the Title Insurance
Policy and are in full force and effect without default thereunder. The Project
has rights of access to public ways and is served by water, sewer, sanitary
sewer and storm drain facilities adequate to service the Project for its
intended uses. All public utilities necessary or convenient to the full use and
enjoyment of the Project are located in the public right-of-way abutting the
Project, and all such utilities are connected so as to serve the Project without
passing over other property absent a valid easement. All roads necessary for the
use of the Project for its current purpose have been completed and dedicated to
public use and accepted by all Governmental Authorities.

       6.22.5  The Project is comprised of one (1) or more parcels which
constitute separate tax lots and do not constitute a portion of any other tax
lot not a part of the Project.

       6.22.6  There are no pending or proposed special or other assessments for
public improvements or otherwise affecting the Project, nor are there any
contemplated improvements to the Project that may result in such special or
other assessments.

       6.22.7  None of the Improvements on the Project is located in an area
identified by the Federal Emergency Management Agency as a special flood hazard
area or flood insurance (adequate in the judgment of Lender) has been obtained
and is in effect.

       6.22.8  The Project, including all buildings, Improvements, parking
facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC
systems, fire protection systems, electrical systems, equipment, elevators,
exterior sidings and doors, landscaping, irrigation systems and all structural
components, are in good condition, order and repair in all material respects;
there exists no structural or other material defects or damages in the Project,
whether latent or otherwise, and no Loan Party has received notice from any
insurance company or bonding company of any defects or inadequacies in the
Project, or any part thereof, which would adversely affect the insurability of
the same or cause the imposition of extraordinary premiums or charges thereon or
of any termination or threatened termination of any policy of insurance or bond.

       6.22.9  All of the Improvements which were included in determining the
appraised value of the Project lie wholly within the boundaries and building
restriction lines of the Project, and no improvements on adjoining properties
encroach upon the Project, and no easements or other encumbrances affecting the
Project encroach upon any of the Improvements, so as to affect the value or
marketability of the Project except those which are insured against by the Title
Insurance Policy.

                                       18
<Page>

       6.22.10 The Borrower has delivered to Lender a true, complete and correct
copy of the current rent roll. There are no oral agreements with respect to any
of the Leases. No Rent (including security deposits) has been paid more than one
(1) month in advance of its due date.

       6.22.11 The Improvements have suffered no material casualty or damage
which has not been fully repaired and the cost thereof fully paid.

   6.23.   SURVIVAL OF REPRESENTATIONS. The representations and warranties set
forth in this Article 6 shall survive until such time as the Obligations shall
be indefeasibly paid in full.

     ARTICLE 7.   COVENANTS.

   7.1.    AFFIRMATIVE COVENANTS. Until the Obligations shall be indefeasibly
paid in full, the Borrower covenant as follows:

       7.1.1   Each Borrower shall, and shall cause each other Loan Party to, do
or cause to be done all things necessary to preserve, renew and keep in full
force and effect its existence, rights, licenses, permits and franchises and
comply with all Legal Requirements applicable to it, the Collateral and the
Project.

       7.1.2   The Borrower shall comply with the special purpose covenants set
forth on EXHIBIT B.

       7.1.3   Each Borrower shall, and shall cause each other Loan Party to,
pay all Taxes and other charges now or hereafter levied, assessed or imposed as
the same become due and payable, and furnish to Lender receipts for the payment
of the Taxes and the other charges prior to the date the same shall become
delinquent (PROVIDED, HOWEVER, that Borrower need not pay directly Taxes nor
furnish such receipts for payment of Taxes to the extent that the funds to pay
for such Taxes have been deposited into the reserves required under the Mortgage
Loan Documents). Borrower shall not, and shall not permit any other Loan Party
to, permit or suffer to exist any lien or charge against the Project other than
Permitted Encumbrances, and shall promptly pay for all utility services provided
to the Project. After prior written notice to Lender, Borrower, at their own
expense, may contest by appropriate legal proceeding, conducted in good faith
and with due diligence, the amount or validity of any Taxes or other charges,
provided that (i) no Default or Event of Default has occurred and remains
uncured; (ii) such proceeding shall be permitted under and be conducted in
accordance with all applicable statutes, laws and ordinances; (iii) neither the
Project nor any part thereof or interest therein will be in danger of being
sold, forfeited, terminated, canceled or lost; (iv) Borrower shall, promptly
upon final determination thereof, pay the amount of any such Taxes or other
charges, together with all costs, interest and penalties which may be payable in
connection therewith; and (v) such proceeding shall suspend the collection of
Taxes or other charges from the Project.

       7.1.4   Borrower shall take, or require to be taken, such acts as from
time to time may be required under Applicable Law in order that the interest on
the Loan continues to be excludable from gross income for purposes of federal
income taxation, and shall refrain from

                                       19
<Page>

taking, and shall cause each other Loan Party to refrain from taking, any action
which would adversely affect the exclusion from gross income of interest from
federal income taxation.

       7.1.5   Borrower shall give prompt written notice to Lender of any
litigation or governmental proceedings pending or threatened against Borrower or
any other Loan Party which might materially adversely affect the condition or
business, financial or otherwise, as applicable, of the Collateral, the Project,
Mortgage Borrower, Borrower or any Loan Party (including, without limitation,
the ability of any other the foregoing to perform their obligations hereunder or
under the other Loan Documents, under the Mortgage Loan Documents).

       7.1.6   Borrower shall permit any authorized representatives designated
by Lender to visit, examine, audit, and inspect, upon reasonable notice and
during normal business hours, the Project including its financial and accounting
records, and to make copies and take extracts therefrom, and to discuss its and
their affairs, finances and business with its and their officers and independent
public accountants, as often as may be reasonably requested. Borrower shall
cause their Affiliates to make all books of account and records available to
Lender at the office where the same are regularly maintained. Lender shall have
the right to copy, duplicate and make abstracts from such books and records as
Lender may require. Borrower shall pay any reasonable costs incurred by Lender
to examine such books, records and accounts. Borrower acknowledges and agrees
that (i) all of such audits, inspections and reports shall be made for the sole
benefit of Lender, and not for the benefit of Borrower or any third party, and
neither Lender nor Lender's auditors or inspectors or any of Lender's
representatives, agents or contractors assumes any responsibility or liability
(except to Lender) by reason of such audits, inspections or reports, (ii)
Borrower will not rely upon any of such audits, inspections or reports for any
purpose whatsoever, and (iii) the performance of such audits, inspections and
reports will not constitute a waiver of any of the provisions of this Agreement
or any other Loan Document or any of the obligations of Borrower or any other
Loan Party hereunder or thereunder. Borrower further acknowledges and agrees
that neither Lender nor Lender's inspector, representatives, agents or
contractors shall be deemed to be in any way responsible for any matters related
to design or construction of the Improvements or any construction work. At any
time during the term of the Loan, Borrower shall cooperate with Lender and use
reasonable efforts to assist Lender in obtaining an appraisal of the Project.
Such cooperation and assistance from Borrower shall include but not be limited
to the obligation to provide Lender or Lender's appraiser, upon request, with
the following to the extent within the possession of the Loan Parties: (i)
reasonable access to the Project, (ii) a current certified rent roll for the
Project in form and substance satisfactory to Lender, including current asking
rents and a history of change in asking rents and historical vacancy for the
past three years, (iii) current and budgeted income and expense statements for
the prior three years, (iv) the then existing site plan and survey of the
Project, (v) the building plans and specifications, including typical elevation
and floor plans, to the extent in either Borrower's possession or available to
Borrower; (vi) the current and prior year real estate tax bills, (vii) a
detailed list of past and scheduled capital improvements and the costs thereof,
(viii) all environmental reports and other applicable information relating to
the Project, and (ix) copies of all recent appraisals/property description
information or brochures, including descriptions of amenities and services
relating to the Project to the extent in either Borrower's possession or

                                       20
<Page>

available to Borrower. The appraiser performing any such appraisal shall be
engaged by Lender, and Borrower shall be responsible for any fees payable to
said appraiser in connection with an appraisal of the Project. Borrower shall
cooperate with Lender with respect to any proceedings before any Governmental
Authority which may in any way affect the rights of Lender hereunder or any
rights obtained by Lender under any of the Loan Documents and, in connection
therewith, not prohibit Lender, at its election, from participating in any such
proceedings.

       7.1.7   Borrower shall, at Borrower' sole cost and expense, (a): execute
and deliver to Lender such documents, instruments, certificates, assignments and
other writings, and do such other acts necessary or desirable, to evidence,
preserve and/or protect the Collateral, as Lender may reasonably require; and
(b) do and execute all and such further lawful and reasonable acts, conveyances
and assurances for the better and more effective carrying out of the intents and
purposes of this Agreement and the other Loan Documents, as Lender shall
reasonably require from time to time.

       7.1.8   Borrower shall:

       (a)     maintain or cause to be kept and maintained proper and accurate
books and records, in accordance with GAAP, reflecting the financial affairs of
Borrower and the other Loan Parties and all items of income and expense and any
services, equipment or furnishings provided in connection with the operation of
the Project, whether such income or expense is realized by Borrower, Mortgage
Borrower, or any Affiliate of any Loan Party. Lender shall have the right from
time to time during normal business hours upon reasonable notice to Borrower to
examine such books and records at the office of Borrower or other Person
maintaining such books and records and to make such copies or extracts thereof
as Lender shall desire. Borrower shall pay any costs incurred by Lender to
examine such books, records and accounts, as Lender shall determine to be
necessary or appropriate in the protection of Lender's interest;

       (b)     furnish to Lender annually, within ninety (90) days following the
end of each Fiscal Year, a complete copy of Borrower' and the Mortgage
Borrower's annual financial statements audited by an accounting firm acceptable
to Lender, prepared in accordance with GAAP, covering the Project, including
statements of income and expense and cash flow for Borrower and the Mortgage
Borrower and the Project and a balance sheet for Borrower and the Mortgage
Borrower. Such statements shall set forth Net Operating Income, Gross Revenues
and Operating Expenses for the Project;

       (c)     furnish to Lender on or before the forty-fifth (45th) day after
the end of each calendar quarter, the following items:

           (i)      quarterly and year-to-date statements of income and expense
     and cash flow prepared for such quarter with respect to the Project, with a
     balance sheet for such quarter for Borrower and Mortgage Borrower;

           (ii)     a current rent roll for the Project;

                                       21
<Page>

       (d)     furnish Lender concurrently with delivery of financial statements
under clauses (b), (c) and (d) above, an Officer's Certificate (i) certifying,
to Borrower's knowledge, as to whether a Default or Event of Default has
occurred and, if a Default or Event of Default has occurred, specifying the
details thereof and any action taken or proposed to be taken with respect
thereto, (ii) certifying, to Borrower's knowledge, that such items are true,
correct, accurate and complete and fairly present the financial condition and
results of the operations of Borrower, Mortgage Borrower and the Project in
accordance with GAAP as applicable, (iii) setting forth reasonably detailed
calculations of, and demonstrating compliance with, any financial covenants set
forth in the Loan Documents, and (iv) stating whether any change in GAAP or in
the application thereof has occurred since the date of the most recent audited
financial statements and, if any such change has occurred, specifying the effect
of such change on the financial statements accompanying such Officer's
Certificate.

       7.1.9   Promptly upon receipt thereof, Borrower shall deliver to Lender
copies of all significant reports submitted to Mortgage Borrower and Borrower by
independent public accountants in connection with each annual, interim or
special audit of the financial statements of any Loan Party made by such
accountants, including the comment letter submitted by such accountants to
management in connection with their annual audit.

       7.1.10  Borrower shall furnish to Lender, within five (5) Business Days
after request (or as soon thereafter as may be reasonably possible), such
further detailed information with respect to the operation of the Project and
the financial affairs of Loan Parties as may be reasonably requested by Lender.

       7.1.11  Borrower will deliver to Lender promptly upon receipt thereof (i)
all financial statements, reports, certificates and related items delivered or
required to be delivered by Mortgage Borrower to Mortgage Lender under the
Mortgage Loan Documents as and when due thereunder and (ii) all notices,
amendments, modification, waivers and other documents and instruments at any
time executed and/or delivered by any Person in connection with Mortgage Loan
Documents.

       7.1.12  Borrower will warrant and defend the validity and priority of the
Liens of the Loan Documents on the Collateral against the claims of all Persons
whomsoever, subject only to Permitted Encumbrances.

       7.1.13  Borrower shall within five (5) Business Days of request therefor
furnish Lender with a statement, duly acknowledged and certified, stating (i)
the unpaid principal amount of the obligations under the Mortgage Loan
Documents, (ii) the interest rate applicable to the obligations under the
Mortgage Loan Documents, (iii) the date installments of interest and/or
principal were last paid under the Mortgage Loan Documents, (iv) offsets or
defenses to the payment and performance of the obligations under the Mortgage
Loan Documents, if any, and (v) that the Mortgage Loan Documents have not been
modified or, if modified, giving particulars of such modification.

                                       22
<Page>

       7.1.14  Upon request, Borrower shall furnish Lender with executed copies
of all Leases. No material changes may be made to the Lender-approved standard
lease without the prior written consent of Lender. All renewals of existing
Leases and all proposed new leases shall be arms length transactions. Borrower
shall cause the Mortgage Borrower to (i) observe and perform the obligations
imposed upon the lessor under the Leases in a commercially reasonable manner;
(ii) enforce the terms, covenants and conditions contained in the Leases on the
part of the lessee thereunder to be observed or performed in a commercially
reasonable manner; (iii) not collect any of the Rents more than one (1) month in
advance (other than security deposits); and (iv) not execute any assignment of
lessor's interest in the Leases or the Rents (except as contemplated by the
Mortgage Loan Documents).

       7.1.15  No security deposits of Tenants, whether held in cash or any
other form, shall be commingled with any other funds of any Loan Party and, if
cash, shall be deposited by the Mortgage Borrower at a separately designated
account under the Mortgage Borrower's control and held in accordance with the
terms of the Mortgage Loan Documents and applicable Legal Requirements. Borrower
shall, upon request, provide Lender with evidence satisfactory to Lender of
compliance with the foregoing.

       7.1.16  Lender's prior written approval shall be required in connection
with any alterations to the Project that may have a material adverse effect on
any Loan Party's financial condition, the value of the Project or the ongoing
revenues and expenses of the Project. The Lender hereby approves the renovation
work outlined on Schedule 7.17.

       7.1.17  With respect to insurance:

       (a)     Borrower shall obtain or cause to be obtained in respect of the
Collateral and the Project the insurance as may be required by the Mortgage Loan
Documents (collectively, the "INSURANCE"), to the extent applicable in Lender's
discretion, issued by insurance companies and containing terms satisfactory to
Lender in its discretion;

       (b)     Borrower shall give Lender prompt notice of any loss or damage to
the Project; and,

       (c)     subject to the rights of the Mortgage Lender under the Mortgage
Loan Documents:

           (i)      In the case of any loss or damage in excess of $100,000.00
     covered by any Insurance, Lender is hereby authorized (i) if an Event of
     Default shall have occurred or, if no Event of Default shall have occurred
     but Borrower and/or the Mortgage Borrower fail to settle and adjust or to
     provide reasonable evidence that it is proceeding in good faith to settle
     and adjust any claim within ninety (90) Business Days after such casualty
     has occurred, to settle and adjust any claim under such Insurance without
     the consent of Borrower; or (ii) if no Event of Default has occurred, to
     allow Borrower within two hundred and seventy (270) Business Days after
     such casualty to settle and adjust such claim provided that, if any
     settlement may reasonably be anticipated to result in proceeds in excess of
     $1,000,000.00, the prior consent of Lender shall be required, which consent

                                       23
<Page>

     shall not to be unreasonably withheld; PROVIDED, FURTHER, that in either
     case Lender shall, and is hereby authorized to, collect and receive any
     such insurance proceeds, but only to the extent of the then outstanding
     principal and interest on the Loan. The out-of pocket expenses incurred by
     Lender in the adjustment and collection of such proceeds of Insurance shall
     become a part of the Obligations, and shall be reimbursed to Lender upon
     demand or, at Lender's option, in the event and to the extent sufficient
     proceeds are available, deducted by Lender from such proceeds of Insurance
     prior to any other application thereof;

           (ii)     Lender shall, in its sole discretion, apply the proceeds of
     Insurance consequent upon any casualty either (i) to reduce the
     Obligations; or (ii) at Lender's election, to reimburse Borrower for or to
     pay the costs of restoring, repairing, replacing or rebuilding
     (collectively, a "RESTORATION") the loss or damage caused by such casualty,
     in accordance with and subject to the conditions contained in the
     provisions of Section 7.1.17(c)(v). Notwithstanding the foregoing, Lender
     agrees to permit the proceeds of Insurance to be applied toward the cost of
     Restoration if (a) the Mortgage Lender is permitting such proceeds to be so
     applied toward Restoration in accordance with the Mortgage Loan Documents;
     and (b) the requirements of Section 7.1.17(c)(v) are otherwise satisfied.

           (iii)    If and to the extent that proceeds of Insurance are made
     available to Borrower or are sufficient for such purposes, Borrower hereby
     covenants promptly after such casualty, to commence and thereafter
     diligently proceed to restore the Improvements, to be of at least equal
     value and of substantially the same character as prior to such loss or
     damage, if allowed by law, in accordance with all Legal Requirements and
     plans, specifications and procedures to be first submitted to and approved
     by Lender.

           (iv)     Any portion of the proceeds of Insurance remaining after
     payment in full of the Obligations shall be paid to Borrower or as ordered
     by a court of competent jurisdiction.

           (v)      Provided that no Event of Default has occurred and is then
     continuing, proceeds of Insurance that Lender elects to apply to
     Restoration of the Project in accordance with Section 7.1.17(c)(ii) shall
     be disbursed from time to time (but not more often than monthly) upon
     Lender being furnished with (i) evidence reasonably satisfactory to Lender
     from an independent architect or other Person, in any case approved by
     Lender of the estimated cost of completion of the Restoration; (ii) a
     certification from an independent architect or general contractor
     satisfactory to Lender stating that the Restoration is reasonably likely to
     be substantially completed on or before the date which is one (1) year
     prior to the Maturity Date; (iii) cash sufficient in addition to the
     proceeds of Insurance, to complete and fully pay for the completion of the
     Restoration, based on the cost estimate referenced in clause (i) above;
     (iv) a request from Borrower, dated not more than twenty (20) Business Days
     prior to the proposed application of such payment, requesting such payment
     or reimbursement and setting forth the Restoration work which is

                                       24
<Page>

     in the subject of such request, the parties which performed such work, and
     the actual cost thereof, and certifying that such work and materials are
     free and clear of Liens; and (v) such architect's certificates, waivers of
     lien, contractor's sworn statements, title insurance endorsements, plats of
     survey and such other evidences of cost, payment and performance as Lender
     may reasonably require and approve. Lender may, in all events, require that
     all plans and specifications for any such Restoration be submitted to and
     approved by Lender and that all required permits be obtained prior to
     commencement of Restoration. Except as provided below, any cash provided in
     accordance with clause (iii) above shall be applied as if such cash were
     proceeds of Insurance. No payment made prior to the final completion of the
     Restoration shall exceed ninety five percent (95%) of the value of the
     Restoration performed or materials delivered, as applicable, from time to
     time, as such value shall be determined by Lender in its reasonable
     judgment. Funds other than proceeds of Insurance shall be disbursed prior
     to disbursement of such proceeds, except as may otherwise be provided
     herein; and at all times the undisbursed balance of such proceeds, together
     with cash furnished to Lender in accordance with clause (iii) above to pay
     the cost of completion of the Restoration, shall be at least sufficient in
     the reasonable judgment of Lender to pay the entire unpaid cost of the
     completion of the Restoration, free and clear of all Liens or claims for
     Lien. In addition to all other conditions contained in this Section
     7.1.17(c)(v), final payment of all proceeds of Insurance remaining with
     Lender shall be made upon receipt by Lender of a certification by an
     independent architect or contractor approved by Lender as to the completion
     of the Restoration substantially in accordance with the submitted plans and
     specifications, and the filing of a notice of completion (if such filing is
     required by applicable Legal Requirements). Any surplus which may remain
     out of proceeds of Insurance (or cash provided pursuant to clause (iii)
     above) held by Lender after payment of such costs of Restoration shall,
     provided no Event of Default has occurred and is continuing, be disbursed
     to Borrower. If there shall have occurred an Event of Default while Lender
     is holding funds for Restoration, Lender may at its sole option apply such
     funds against the Obligations in such order or manner as Lender may elect.
     Borrower shall pay, from time to time, within five (5) Business Days after
     demand therefor, the fees and expenses of any consultant hired by Lender to
     review the progress of the Restoration and inspect the work of Restoration,
     which consultant's approval shall be required for any disbursement to be
     made. Lender shall not be obligated to see to the proper application of
     funds disbursed to Borrower pursuant hereto, whether pursuant to the above
     conditions or upon waiver thereof.

           (vi)     Any and all awards (the "AWARDS") heretofore or hereafter
     made or to be made by any Governmental Authority for the taking by
     Condemnation or eminent domain, of all or any part of the Project
     (including any award from the United States government at any time after
     the allowance of a claim thereof), or the proceeds from a transfer in lieu
     of such condemnation or eminent domain, to the extent the Borrower is
     entitled thereto, are hereby assigned by Borrower to Lender, and Lender is
     hereby authorized to collect and receive such Awards from the condemnation
     authorities. Lender is hereby authorized to give appropriate receipts
     therefor and Borrower hereby irrevocably appoints Lender as Borrower'
     attorney in fact, coupled with an interest, to collect such

                                       25
<Page>

     Awards. Borrower shall give Lender prompt notice of the actual or
     threatened commencement of any Condemnation or eminent domain proceedings
     affecting all or any part of the Project and shall deliver to Lender copies
     of any and all papers served in connection with any such proceedings.
     Borrower further agrees to make, execute and deliver to Lender, at any time
     upon request, any and all further assignments and other instruments deemed
     reasonably necessary by Lender for the purpose of validly and sufficiently
     assigning all Awards and other compensation heretofore and hereafter made
     to Borrower upon any taking, either permanent or temporary, under any such
     proceeding and all proceeds paid from a sale in lieu of such taking, and to
     facilitate Lender's collection and receipt of the same. If, notwithstanding
     the foregoing provisions, any Award or other compensation described above
     is nonetheless paid to Borrower, Borrower shall hold such monies in trust
     for the benefit of Lender, and Borrower shall immediately pay the same to
     Lender. The expenses incurred by Lender in the collection and
     administration of any Award, including reasonable attorneys' fees and
     disbursements, shall become a part of the Obligations, and shall be
     reimbursed to Lender upon demand or, at Lender's option, in the event and
     to the extent sufficient proceeds are available, shall be deducted by
     Lender from said proceeds prior to any other application hereof. Borrower
     may not settle or compromise any claim for or right to receive any Award or
     rights under any proceeding with respect thereto without the prior written
     consent of Lender. Notwithstanding any taking, Borrower shall continue to
     make all payments required pursuant to the Loan Documents to Lender at the
     time and in the manner provided in the Loan Documents and the Obligations
     shall not be reduced by reason of such taking (or transfer in lieu thereof)
     unless and until any Award shall have been actually received and applied by
     Lender to such Obligations and then only to such extent. Lender shall not
     be limited to the interest paid on the Award by the condemning authority,
     if any, but shall be entitled to receive out of the Award interest at the
     interest rate under the Note. Lender shall, in its sole discretion, apply
     the proceeds of the Award consequent upon any taking either (i) to reduce
     the Obligations; or (ii) in the event of a partial taking, at Lender's
     election, to reimburse Borrower for or to pay the costs a Restoration, the
     loss or damage caused by such taking, in accordance with and subject to the
     conditions contained in the provisions of Section 7.1.17(c)(v).
     Notwithstanding the foregoing, Lender agrees to permit the proceeds of any
     Award to be applied toward the cost of Restoration if (a) the Mortgage
     Lender is permitting such proceeds to be so applied toward Restoration in
     accordance with the Mortgage Loan Documents; and (b) the requirements of
     Section 7.1.17(c)(v) are otherwise satisfied.

       7.1.18  Borrower will use its good faith and commercially reasonable
efforts to comply with the Patriot Act (as defined below) and all applicable
requirements of governmental authorities having jurisdiction over Borrower,
Mortgage Borrower and the Project, including those relating to money laundering
and terrorism. Lender shall have the right to audit compliance with the Patriot
Act and all applicable requirements of governmental authorities having
jurisdiction over Borrower, Mortgage Borrower and the Project. In the event that
Borrower or Mortgage Borrower fail to comply with the Patriot Act or any such
requirements of governmental authorities, then the Lender may, at its option,
cause Borrower to comply therewith and/or cause

                                       26
<Page>

Borrower to require that Mortgage Borrower comply therewith, and any and all
costs and expenses incurred by the Lender in connection therewith shall be
secured by the Collateral and the Loan Documents and shall be immediately due
and payable. For purposes hereof, the term "Patriot Act" means the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as the same may be amended
from time to time, and corresponding provisions of future laws.

     7.1.19    Each of the covenants of the Mortgage Borrower set forth in the
Mortgage Loan Documents are hereby incorporated in this Agreement by this
reference as if fully set forth herein. The Borrower shall cause the Mortgage
Borrower to comply with all terms and conditions of each Mortgage Loan Document
to which it is a party or by which it is bound within any and all applicable
notice and cure provisions set forth therein.

     7.1.20    The Borrower shall establish and maintain through the term of the
Loan an operating deposit account at the Lender.

     7.1.21    The Guarantor has provided the REIT Line to the REIT, which REIT
Line is secured by a pledge by the REIT to the Guarantor of the REIT's ownership
interests in a portfolio of 10 properties located in Jacksonville, Florida,
Portland, Oregon, Salt Lake City, Utah, and Seattle, Washington. Pursuant to the
documents evidencing the REIT Line, the Guarantor is to be repaid from proceeds
raised from the REIT's pending equity offering and will release its lien on the
REIT's interest in a subject community as the indebtedness allocated to the
respective community is repaid by the REIT from such equity proceeds. In
connection therewith, at such time as the balances outstanding under the REIT
Line constitute solely the debt allocated to the Seattle, Washington
communities, the Guarantor shall, and the Borrower shall cause the Guarantor and
REIT to, apply any further proceeds received from the REIT's ongoing security
sale to the repayment of all accrued interest and then to the principal
outstanding under the Loan until it is repaid in full.

   7.2.    NEGATIVE COVENANTS. Until the Obligations shall be indefeasibly paid
in full, the Borrower covenants as follows:

     7.2.1     Borrower shall not, and shall not permit Mortgage Borrower or any
other Loan Party to, sell, convey, mortgage, grant, bargain, encumber, pledge,
assign or transfer (each, a "PROHIBITED TRANSFER"), whether voluntarily or
involuntarily, (i) the Project or any part thereof, (ii) the Collateral or any
part thereof or (iii) any interest, direct or indirect, in the Borrower, or the
Mortgage Borrower, other than transfers by Broadstone Preston Alliance LLC or
Alliance G.P. IV, Inc. of its interests in the Mortgage Borrower. A Prohibited
Transfer shall be deemed to include (i) an installment sales agreement wherein
any Loan Party agrees to sell the Project or any part thereof for a price to be
paid in installments; (ii) an agreement by any Loan Party leasing all or a
substantial part of the Project for other than actual occupancy by a space
tenant thereunder or a sale, assignment or other transfer of, or the grant of a
security interest in, any Loan Party's right, title and interest in and to any
Leases or any Rents; (iii) if the Borrower or the Mortgage Borrower is a
corporation, the voluntary or involuntary sale, conveyance or transfer of such
corporation's stock (or the stock of any corporation directly or indirectly
controlling such corporation by operation of law or otherwise) or the creation
or issuance of new stock in one or a

                                       27
<Page>

series of transactions; (iv) if Borrower or the Mortgage Borrower is a limited
or general partnership, joint venture or limited liability company, the change,
removal, resignation or addition of a general partner, managing partner, limited
partner, joint venturer or member or the transfer of the partnership interest of
any general partner, managing partner or limited partner or the transfer of the
interest of any joint venturer or member, with the exception of ALLTX GP, LLC
becoming the managing general partner of the Mortgage Borrower; and (v) any
pledge, hypothecation, assignment, transfer or other encumbrance of any direct
or indirect ownership interest in Borrower or the Mortgage Borrower.

     7.2.2     Without in any way limiting the provisions of this Article 7,
Borrower shall not, and shall not permit any other Loan Party to, take or permit
any action that would result in any of the foregoing not being in compliance
with the representations, warranties and covenants set forth in EXHIBIT B.

     7.2.3     Borrower shall not, and shall not permit the Borrower or the
Mortgage Borrower to:

     (a)       create, incur, assume or suffer to exist any Lien on any direct
or indirect interest in the Borrower or the Mortgage Borrower or any portion of
the Project or the Collateral except for Permitted Encumbrances; provided,
however, that notwithstanding anything to the contrary in any Loan Document,
Mortgage Borrower shall be permitted to refinance the Mortgage Loan with Freddie
Mac on terms and conditions substantially equivalent to the Mortgage Loan
Documents if simultaneously with such refinancing Freddie Mac executes and
delivers an intercreditor agreement with Lender in the form approved by Lender
and attached hereto as Schedule 7.2.3;

     (b)       incur any Indebtedness, except that Borrower may incur the
Obligations and Mortgage Borrower may incur Indebtedness under the Mortgage Loan
Documents;

     (c)       (i) engage in any dissolution, liquidation or consolidation or
merger with or into any other business entity, (ii) engage in any business
activity not related to the ownership and operation of the Project or (iii)
transfer, lease or sell, in one transaction or any combination of transactions,
any of their property or assets or any property or assets of the Borrower or the
Mortgage Borrower;

     (d)       enter into any line of business other than directly connected
with the ownership of the Collateral and the Project;

     (e)       change the current use of the Project in any material respect;

     (f)       cancel or otherwise forgive or release any claim or debt (other
than termination of Leases in accordance herewith) owed to Borrower or any other
Loan Party by any Person, except for adequate consideration and in the ordinary
course of business;

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<Page>

     (g)       with the exception of the management contract with Alliance
Residential, LLC, enter into, or be a party to, any transaction with an
Affiliate of any Loan Party except in the ordinary course of business and on
terms which are fully disclosed to Lender in advance and are no less favorable
to such Loan Party or such Affiliate than would be obtained in a comparable
arm's length transaction with an unrelated third party;

     (h)       initiate or consent to any zoning reclassification of any portion
of the Project or seek any variance under any existing zoning ordinance or use
or permit the use of any portion of the Project in any manner that could result
in such use becoming a non-conforming use under any zoning ordinance or any
other applicable land use law, rule or regulation;

     (i)       purchase or own any property other than the Project and
Collateral and any property necessary or incidental to the ownership of the
Collateral or Project;

     (j)       suffer, permit or initiate the joint assessment of the Project
(i) with any other real property constituting a tax lot separate from the
Project, and (ii) with any portion of the Project which may be deemed to
constitute personal property, or any other procedure whereby the lien of any
taxes which may be levied against such personal property shall be assessed or
levied or charged to the Project;

     (k)       change its principal place of business from the address set forth
on the first page of this Agreement without first giving Lender thirty (30) days
prior notice;

     (1)       change its name, identity (including its trade name or names) or,
if not an individual, its corporate, partnership or other structure, without
notifying Lender of such change in writing at least thirty (30) days prior to
the effective date of such change and, in the case of a change in structure,
without obtaining the prior written consent of Lender. Borrower shall cause the
applicable Loan Party to execute and deliver to Lender, prior to or
contemporaneously with the effective date of any such change, any financing
statement or financing statement change required by Lender to establish or
maintain the validity, perfection and priority of the security interest granted
under the Loan Documents. At the request of Lender, Borrower shall execute a
certificate in form satisfactory to Lender listing the trade names under which
Mortgage Borrower intends to operate the Project, and representing and
warranting that Mortgage Borrower does business under no other trade name with
respect to the Project;

     (m)       engage in any transaction which would cause any obligation, or
action taken or to be taken, under any Loan Document (or the exercise by Lender
of any of its rights under any Loan Document) or under the Mortgage Loan
Documents (or the exercise by Mortgage Lender of any of its rights under the
Mortgage Loan Documents) to be a non-exempt (under a statutory or administrative
class exemption) prohibited transaction under the Employee Retirement Income
Security Act of 1974, as amended ("ERISA");

     (n)       modify, waive in any material respect or release any Easements,
restrictive covenants or other Permitted Encumbrances, or suffer, consent to or
permit the foregoing;

                                       29
<Page>

     (o)       take or permit any action that would result in Mortgage Borrower
not being in compliance with the representations, warranties and covenants set
forth in the Mortgage;

     (p)       (i) amend or modify any Mortgage Loan Documents, (ii) prepay,
refinance or defease the obligations under the Mortgage Loan Documents unless
the Loan (including all interest and all other Obligations) is simultaneously
paid in full, or (iii) take any action in violation of the terms of the Mortgage
Loan Documents. Borrower shall provide Lender with a copy of any amendment or
modification to the Mortgage Loan Documents within two (2) Business Days after
the execution thereof.

     ARTICLE 8.   PROJECT MANAGEMENT

   8.1.    MANAGER. Subject to the rights of Mortgage Lender under the Mortgage
Loan Documents, Lender shall have the right to require Borrower, to the extent
permitted under the Borrower's partnership agreement, to cause Mortgage Borrower
to hire a manager for the Project with a Person chosen by Borrower or Mortgage
Borrower and approved by Lender, or selected by Lender, upon the occurrence of
any one or more of the following events: (i) from and after the Stated Maturity
Date, or (ii) at any time following the occurrence of an Event of Default.

     ARTICLE 9.   EVENTS OF DEFAULT; REMEDIES.

   9.1.    EVENTS OF DEFAULT. If an Event of Default (as defined below) shall
occur and shall be continuing, the Lender may, at its option, declare the
outstanding principal amount of the Note, and accrued interest on the Note and
all other Obligations, immediately due and payable, and upon such declaration
the maturity of the Obligations shall be accelerated and shall become
immediately due and payable without presentment, demand, protest or notice of
any kind, all of which are expressly waived. An "EVENT OF DEFAULT" shall be
deemed to have occurred if:

       9.1.1   any installment of principal and/or interest due under the Note
are not paid within five (5) days of when due or the Obligations are not paid in
full on the Maturity Date;

       9.1.2   any other portion of the Obligations (other than as set forth in
the foregoing Section 9.1.1) is not paid when due and such non-payment continues
for five (5) days after the date that the same is due and payable;

       9.1.3   any Taxes or other charges are not paid when due (provided that
it shall not be an Event of Default if there are sufficient funds in any tax
reserve account established pursuant to the terms of the Mortgage Loan Documents
to pay such amounts when due and Mortgage Lender fails to make such payment in
violation of the Mortgage Loan Documents);

       9.1.4   there shall be a breach of any of the provisions of any of
Section 7.1.2, 7.1.3, 7.1.4, or 7.1.8, or 7.2 continuing uncured for thirty (30)
days after written notice to the Borrower;

       9.1.5   the Borrower breaches any representation, warranty or covenant
set forth on EXHIBIT C hereof;

                                       30
<Page>

       9.1.6   any representation or warranty made by any Loan Party herein or
in any other Loan Document, or in any report, certificate, financial statement
or other instrument, agreement or document furnished to Lender, shall have been
false or misleading in any material respect as of the date the representation or
warranty was made, which warranty continues uncured for thirty (30) days after
written notice to the Borrower;

       9.1.7   any Loan Party shall admit in writing that it is unable to pay
its debts generally as they become due or such Loan Party shall make an
assignment for the benefit of creditors;

       9.1.8   a receiver, liquidator or trustee shall be appointed for any Loan
Party or if any Loan Party shall be adjudicated a bankrupt or insolvent, or if
any petition for bankruptcy, reorganization or arrangement pursuant to federal
bankruptcy law, or any similar federal or state law, shall be filed by or
against, consented to, or acquiesced in by, any Loan Party, or if any proceeding
for the dissolution or liquidation of any Loan Party shall be instituted;
PROVIDED, HOWEVER, if such appointment, adjudication, petition or proceeding was
involuntary and not consented to by any Loan Party, upon the same not being
discharged, stayed or dismissed within sixty (60) days;

       9.1.9   any Loan Party attempts to assign its rights under this Agreement
or any of the other Loan Documents or any interest herein or therein in
contravention of the Loan Documents;

       9.1.10  any event of default as defined or described in the Mortgage Loan
Documents occurs beyond any applicable notice and cure periods set forth
therein; or any other event shall occur or condition shall exist, if the effect
of such event or condition is to accelerate or permit Mortgage Lender to
accelerate the maturity of any portion of the Indebtedness under the Mortgage
Loan Documents;

       9.1.11  there shall be a default under any of the other Loan Documents
beyond any applicable cure periods contained in such Loan Documents, or if any
other such event shall occur or condition shall exist, if the effect of such
event or condition is to accelerate the maturity of any portion of the
Obligations or to permit Lender to accelerate the maturity of all or any portion
of the Obligations;

       9.1.12  there shall be any judgment against any Loan Party or any
attachment or execution against any of its assets for any amount in excess of
$100,000.00 remains unpaid, unstayed or not dismissed for a period of more than
thirty (30) days, provided if the Borrower is diligently contesting any such
attachment in good faith such cure period shall be extended for an additional
sixty (60) days;

       9.1.13  there shall be any challenge by or on behalf of any Loan Party or
any other Person to the validity of any Loan Document or the applicability or
enforceability of any Loan Document strictly in accordance with the subject Loan
Document's terms or which seeks to void, avoid, limit, or otherwise adversely
affect any security interest created by or in any Loan Document or any payment
made pursuant thereto;

                                       31
<Page>

       9.1.14  there shall be any default or event of default under the BCP Loan
beyond any applicable notice and cure periods set forth therein;

       9.1.15  any Lien purported to be created under any Security Document
shall cease to be, or shall be asserted by any Loan Party not to be, a valid and
perfected lien on any Collateral, with the priority required by the applicable
Security Document; or

       9.1.16  there shall occur any uninsured loss to any material portion of
the Collateral.

   9.2.    REMEDIES.

       9.2.1   Upon the occurrence of an Event of Default, all or any one or
more of the rights, powers, privileges and other remedies available to Lender
against any Loan Party under this Agreement or any of the other Loan Documents
or at law or in equity may be exercised by Lender at any time and from time to
time, whether or not all or any of the Obligations shall be declared due and
payable, and whether or not Lender shall have commenced any foreclosure
proceeding or other action for the enforcement of its rights and remedies under
any of the Loan Documents with respect to the Collateral. Any such actions taken
by Lender shall be cumulative and concurrent and may be pursued independently,
singly, successively, together or otherwise, at such time and in such order as
Lender may determine in its sole discretion, to the fullest extent permitted by
law, without impairing or otherwise affecting the other rights and remedies of
Lender permitted by law, equity or contract or as set forth herein or in the
other Loan Documents. Without limiting the generality of the foregoing, if an
Event of Default is continuing (i) Lender is not subject to any "one action" or
"election of remedies" law or rule, and (ii) all Liens and other rights,
remedies or privileges provided to Lender shall remain in full force and effect
until the Obligations have been indefeasibly paid in full.

       9.2.2   Any amounts recovered from the Collateral or any other collateral
for the Obligations may be applied by Lender toward the payment of any interest
and/or principal of the Loan and/or any other Obligations in such order,
priority and proportions as Lender in its sole discretion shall determine.

       9.2.3   If any Loan Party fails to perform any covenant or obligation
contained herein or in any other Loan Document and such failure shall continue
for a period of five (5) Business Days after Borrower' receipt of written notice
thereof from Lender, without in any way limiting Lender's right to exercise any
of its rights, powers or remedies as provided hereunder, or under any of the
other Loan Documents, Lender may, but shall have no obligation to, perform, or
cause performance of, such covenant or obligation, and all costs, expenses,
liabilities, penalties and fines of Lender incurred or paid in connection
therewith shall be payable by Borrower to Lender upon demand and if not paid
shall be added to the Obligations (and to the extent permitted under applicable
laws, secured by the Collateral) and shall bear interest thereafter at the
Default Rate. Notwithstanding the foregoing, Lender shall have no obligation to
send notice to Borrower of any such failure.

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<Page>

       9.2.4   The rights, powers and remedies of Lender under the Loan
Documents shall be cumulative and not exclusive of any other right, power or
remedy which Lender may have against any Loan Party pursuant to this Agreement
or the other Loan Documents, or existing at law or in equity or otherwise.
Lender's rights, powers and remedies may be pursued singly, concurrently or
otherwise, at such time and in such order as Lender may determine in Lender's
sole discretion. No delay or omission to exercise any remedy, right or power
accruing upon an Event of Default shall impair any such remedy, right or power
or shall be construed as a waiver thereof, but any such remedy, right or power
may be exercised from time to time and as often as may be deemed expedient. A
waiver of one Default or Event of Default with respect to any Loan Party shall
not be construed to be a waiver of any subsequent Default or Event of Default by
any Loan Party or to impair any remedy, right or power consequent thereon.

   9.3.    Borrower grants to Lender a direct and continuing lien and security
interest, as security for all of Borrower's Obligations, in and upon all
deposits, balances and other sums credited by or due from Lender, or from any
affiliate of Lender, to Borrower including, but not limited to, any cash
collateral pledged to Lender pursuant to any provision of the Loan Documents.

   9.4.    If any payment is not made when due under any of the Loan Documents,
after giving regard to applicable grace periods, if any, or if any Event of
Default or other event which would entitle Lender to accelerate the Loan occurs,
and at all other times if any lien, charge, attachment or judgment is sought to
be imposed against the deposits, balances or other sums credited to Borrower,
whether or not any Default or Event of Default exists, any such deposits,
balances or other sums credited by or due from Lender, or from any such
affiliate of Lender, to the fullest extent not prohibited by applicable law at
any time or from time to time, without regard to the existence, sufficiency or
adequacy of any other collateral, and without notice or compliance with any
other condition precedent now or hereafter imposed by statute, rule of law or
otherwise, all of which are hereby waived, be set off, appropriated and applied
by Lender against any or all of Borrower's Obligations irrespective of whether
demand shall have been made and although such Obligations may be unmatured, in
such manner as Lender in its sole and absolute discretion may determine. Within
five (5) Business Days of making any such set off, appropriation or application,
Lender agrees to notify Borrower thereof, provided the failure to give such
notice shall not affect the validity of such set off or appropriation or
application. All rights of setoff and security interests related to tenant
security deposits shall be subject to the rights of tenant therein and subject
to provisions of applicable law.

   9.5.    The rights of Lender and each affiliate of Lender under this
Article 9 are in addition to, and not in limitation of, other rights and
remedies, including other rights of set off, which Lender may have.

     ARTICLE 10.   ASSIGNMENT AND PARTICIPATION.

   10.1.   CONDITIONS TO ASSIGNMENT BY LENDER. Except as provided herein, the
Lender may assign to one or more Eligible Assignee all or a portion of its
interests, rights and obligations under this Agreement. Unless an Event of
Default shall be existing, the consent of the Borrower,

                                       33
<Page>

which consent will not be unreasonably withheld, will be required for any such
assignment. From and after the effective date of any such assignment, (i) the
assignee thereunder shall be deemed to be a party hereto and, to the extent
agreed to by the Lender, have the rights and obligations of a Lender hereunder,
and (ii) the Lender shall, to the extent of its interest assigned as provided
herein, be released from its obligations under this Agreement.

   10.2.   NEW NOTES, AGREEMENT. Upon any such assignment by the Lender, the
Borrower shall execute and deliver to the Lender, (a) in exchange for the Note,
a new Note to the order of such assignee in an amount equal to the amount
assumed by such assignee and, if the Lender has retained some portion of its
obligations hereunder, a new Note to the order of the Lender in an amount equal
to the amount retained by it hereunder and (b) an amendment to this Agreement
and any other Loan Documents, as may be reasonably requested by the Lender, to
evidence the assignment, provide for the rights and interest of the assignee,
and establish the rights, responsibilities and obligations of the Lender as
agent for itself and any such assignee, provided no such document shall alter
any material terms or provision hereof. Such new Notes shall provide that they
are replacements for the surrendered Notes, shall be in an aggregate principal
amount equal to the aggregate principal amount of the surrendered Notes, shall
be dated the effective date of such assignment and shall otherwise be in
identical form of the assigned Notes. The surrendered Notes shall be cancelled
and returned to the Borrower.

   10.3.   PARTICIPATIONS. The Lender may sell participations to one or more
Eligible Assignees in all or a portion of the Lender's rights and obligations
under this Agreement and the other Loan Documents; provided that (a) any such
sale of participations shall not affect the rights and duties of the Lender
hereunder to the Borrower, (b) the Borrower is given written notice of such
participation, and (c) the only rights granted to the participant pursuant to
such participation arrangements with respect to waivers, amendments or
modifications of the Loan Documents shall be the right to approve waivers,
amendments or modifications that would reduce the principal of or the interest
rate on the Loan, extend the term or increase the amount of the Loan or extend
any regularly scheduled payment date for principal or interest.

   10.4.   PLEDGE BY THE LENDER. The Lender may at any time pledge all or any
portion of its interest and rights under this Agreement (including all or any
portion of the Note) to any of the twelve Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
the enforcement thereof shall release the Lender from its obligations hereunder
or under any of the other Loan Documents.

   10.5.   NO ASSIGNMENT BY THE BORROWER. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior approval of the Lender.

     ARTICLE 11.   MISCELLANEOUS

       11.1.1  All covenants, promises and agreements in this Agreement, by or
on behalf of Borrower, shall inure to the benefit of the legal representatives,
successors and assigns of Lender.

                                       34
<Page>

       11.1.2  THIS AGREEMENT WAS NEGOTIATED IN THE COMMONWEALTH OF
MASSACHUSETTS, AND MADE BY BORROWER AND ACCEPTED BY LENDER IN THE STATE
COMMONWEALTH OF MASSACHUSETTS, AND THE PROCEEDS OF THE NOTE DELIVERED PURSUANT
HERETO WERE DISBURSED FROM THE COMMONWEALTH OF MASSACHUSETTS, WHICH COMMONWEALTH
THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE
UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT
REGARD TO PRINCIPLES OF CONFLICT LAWS) AND ANY APPLICABLE LAW OF THE UNITED
STATES OF AMERICA. TO THE FULLEST EXTENT PERMITTED BY LAW, BORROWER HEREBY
UNCONDITIONALLY AND IRREVOCABLY WAIVE ANY CLAIM TO ASSERT THAT THE LAW OF ANY
OTHER JURISDICTION GOVERNS THIS AGREEMENT AND THE NOTE, AND THIS AGREEMENT AND
THE NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS.

       11.1.3  ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER
ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY AT LENDER'S OPTION BE
INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF BOSTON, COUNTY OF
SUFFOLK, AND BORROWER WAIVES ANY OBJECTIONS WHICH THEY MAY NOW OR HEREAFTER HAVE
BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR
PROCEEDING, AND BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY
SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. BORROWER FURTHER CONSENTS AND
AGREES TO SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH
SUIT, ACTION OR PROCEEDING BY REGISTERED OR CERTIFIED U.S. MAIL, POSTAGE
PREPAID, TO BORROWER AT THE ADDRESS FOR NOTICES DESCRIBED IN SECTION 11.1.6, AND
CONSENTS AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE IN EVERY RESPECT VALID
AND EFFECTIVE SERVICE (BUT NOTHING HEREIN SHALL AFFECT THE VALIDITY OR
EFFECTIVENESS OF PROCESS SERVED IN ANY OTHER MANNER PERMITTED BY LAW).

       11.1.4  No modification, amendment, extension, discharge, termination or
waiver of any provision of this Agreement or of any other Loan Document, nor
consent to any departure by Loan Parties therefrom, shall in any event be
effective unless the same shall be in a writing signed by the party against whom
enforcement is sought, and then such waiver or consent shall be effective only
in the specific instance, and for the purpose, for which given. Except as
otherwise expressly provided herein, no notice to, or demand on Borrower, shall
entitle Borrower to any other or future notice or demand in the same, similar or
other circumstances.

                                       35
<Page>

       11.1.5  Neither any failure nor any delay on the part of Lender in
insisting upon strict performance of any term, condition, covenant or agreement,
or exercising any right, power, remedy or privilege hereunder, or under any
other Loan Document, shall operate as or constitute a waiver thereof, nor shall
a single or partial exercise thereof preclude any other future exercise, or the
exercise of any other right, power, remedy or privilege. In particular, and not
by way of limitation, by accepting payment after the due date of any amount
payable under this Agreement or any other Loan Document, Lender shall not be
deemed to have waived any right either to require prompt payment when due of all
other amounts due under this Agreement or the other Loan Documents, or to
declare a default for failure to effect prompt payment of any such other amount.

       11.1.6  All notices, demands, requests, consents, approvals or other
communications (any of the foregoing, a "NOTICE") required, permitted, or
desired to be given hereunder shall be in writing sent by telefax (with answer
back acknowledged) or by registered or certified mail, postage prepaid, return
receipt requested, or delivered by hand or reputable overnight courier addressed
to the party to be so notified at its address hereinafter set forth, or to such
other address as such party may hereafter specify in accordance with the
provisions of this Section 11.1.6. Any Notice shall be deemed to have been
received: (a) three (3) days after the date such Notice is mailed, (b) on the
date of sending by telefax if sent during business hours on a Business Day
(otherwise on the next Business Day), (c) on the date of delivery by hand if
delivered during business hours on a Business Day (otherwise on the next
Business Day), and (d) on the next Business Day if sent by an overnight
commercial courier, in each case addressed to the parties as follows:

          If to Lender:       Wachovia Bank, National Association
                              One Boston Place
                              27th Floor, WS5200
                              Boston, MA 02108
                              Attention: Joshua R. Howes, Vice President
                              Facsimile No. (617) 603-4220

          with a copy to:     Riemer & Braunstein LLP
                              Three Center Plaza
                              Boston, MA 02108
                              Attention: Kevin J. Lyons, Esquire
                              Facsimile No. (617) 880-3456

          If to Borrower:     ALLTX, LLC
                              c/o Boston Capital
                              One Boston Place
                              Boston, MA 02108
                              Attn:   Mark W. Dunne
                              Facsimile No. (617) 624-8999

                                       36
<Page>

          with a copy to:     Goodwin Procter LLP
                              Exchange Place
                              53 State Street
                              Boston, MA 02109
                              Attention: Andrew C. Sucoff, Esquire
                              Facsimile No. (617) 227-8591

       11.1.7  BORROWER AND LENDER EACH HEREBY AGREE NOT TO ELECT A TRIAL BY
JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVE ANY RIGHT TO TRIAL BY JURY
FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD
TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN
CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY
AND VOLUNTARILY BY BORROWER AND LENDER, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE. EACH PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF
THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

       11.1.8  The Article and/or Section headings and the Table of Contents in
this Agreement are included herein for convenience of reference only and shall
not constitute a part of this Agreement for any other purpose.

       11.1.9  Wherever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement.

       11.1.10 Lender shall have the continuing and exclusive right to apply or
reverse and reapply any and all payments by Loan Parties to any portion of the
Obligations. To the extent any Loan Party makes a payment or payments to Lender,
which payment or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, receiver or any other party under any bankruptcy law, state or
federal law, common law or equitable cause, then, to the extent of such payment
or proceeds received, the obligations hereunder or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by Lender.

       11.1.11 No Loan Party shall be entitled to any notices of any nature
whatsoever from Lender except with respect to matters for which this Agreement
or the other Loan Documents specifically and expressly provide for the giving of
notice by Lender and except with respect to matters for which Loan Parties are
not, pursuant to applicable Legal Requirements, permitted to waive the giving of
notice. Borrower hereby expressly waives the right to receive any notice

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from Lender with respect to any matter for which this Agreement or the other
Loan Documents do not specifically and expressly provide for the giving of
notice by Lender to any Loan Party.

       11.1.12 In the event that a claim or adjudication is made that Lender or
its agents have acted unreasonably or unreasonably delayed acting in any case
where, by law or under this Agreement or the other Loan Documents, Lender or
such agent, as the case may be, has an obligation to act reasonably or promptly,
neither Lender nor its agents shall be liable for any monetary damages, and
Borrower's sole remedy shall be limited to commencing an action seeking
injunctive relief or declaratory judgment. Any action or proceeding to determine
whether Lender has acted reasonably shall be determined by an action seeking
declaratory judgment.

       11.1.13 Borrower shall pay or, if Borrower fails to pay, reimburse Lender
upon receipt of notice from Lender for, all costs and expenses (including
reasonable attorneys' fees and disbursements) incurred by Lender in connection
with (i) Loan Parties' ongoing performance of and compliance with their
agreements and covenants contained in this Agreement and the other Loan
Documents on their part to be performed or complied with, including confirming
compliance with environmental and insurance requirements; (ii) Lender's ongoing
performance of and compliance with all agreements and covenants contained in
this Agreement and the other Loan Documents on its part to be performed or
complied with; (iii) the negotiation, preparation, execution, delivery and
administration of any consents, amendments, waivers or other modifications to
this Agreement and the other Loan Documents and any other documents or matters
requested by any Loan Party; (iv) the filing and recording fees and expenses,
title insurance and reasonable fees and expenses of counsel for providing to
Lender all required legal opinions, and other similar expenses incurred, in
creating and perfecting the Liens in favor of Lender pursuant to this Agreement
and the other Loan Documents; (v) enforcing or preserving any rights, in
response to third party claims or the prosecuting or defending of any action or
proceeding or other litigation, in each case against, under or affecting any
Loan Party, this Agreement, the other Loan Documents, the Collateral, or any
other security given for the Obligations; and (vi) enforcing any obligations of
or collecting any payments due from any Loan Party under this Agreement, the
other Loan Documents or with respect to the Collateral or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "WORK-OUT" or of any insolvency or bankruptcy
proceedings.

       11.1.14 Borrower shall indemnify, defend and hold harmless Lender from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any kind
or nature whatsoever (including the reasonable fees and disbursements of counsel
for Lender in connection with any investigative, administrative or judicial
proceeding commenced or threatened, whether or not Lender shall be designated a
party thereto), that may be imposed on, incurred by, or asserted against Lender
in any manner relating to or arising out of (i) any breach by any Loan Party of
its obligations under, or any material misrepresentation by any Loan Party
contained in, this Agreement or the other Loan Documents, (ii) the use or
intended use of the proceeds of the Loan, (iii) any information provided by or
on behalf of any Loan Party, or contained in any documentation approved by any
Loan Party; (iv) ownership of the Collateral or any interest therein, or receipt
of any Gross

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Revenues (including, without limitation, Rents); (v) any accident, injury to or
death of persons or loss of or damage to property occurring in, on or about the
Project or on the adjoining sidewalks, curbs, adjacent property or adjacent
parking areas, streets or ways; (vi) any use, nonuse or condition in, on or
about the Project or on adjoining sidewalks, curbs, adjacent property or
adjacent parking areas, streets or ways; (vii) performance of any labor or
services or the furnishing of any materials or other property in respect of the
Project; (viii) any failure of the Project to comply with any Legal Requirement;
(ix) any claim by brokers, finders or similar persons claiming to be entitled to
a commission in connection with any Lease or other transaction involving the
Project or any part thereof, or any liability asserted against Lender with
respect thereto; and (x) the claims of any lessee of any portion of the Project
or any Person acting through or under any lessee or otherwise arising under or
as a consequence of any Lease; (collectively, the "INDEMNIFIED LIABILITIES"). To
the extent that the undertaking to indemnify, defend and hold harmless set forth
in the preceding sentence may be unenforceable because it violates any law or
public policy, Borrower shall pay the maximum portion that they are permitted to
pay and satisfy under applicable law to the payment and satisfaction of all
Indemnified Liabilities incurred by Lender. The foregoing indemnification shall
not apply to any matter where the lender has been found liable by a court of
competent jurisdiction of acting in gross negligence or willful misconduct, with
all appeals having been exhausted or waived.

       11.1.15 The Schedules and Exhibits annexed hereto are hereby incorporated
herein as a part of this Agreement with the same effect as if set forth in the
body hereof.

       11.1.16 Any assignee of Lender's interest in and to this Agreement and
the other Loan Documents shall take the same free and clear of all offsets,
counterclaims or defenses which are unrelated to such documents which any Loan
Party may otherwise have against any assignor of such documents, and no such
unrelated counterclaim or defense shall be interposed or asserted by any Loan
Party in any action or proceeding brought by any such assignee upon such
documents and any such right to interpose or assert any such unrelated offset,
counterclaim or defense in any such action or proceeding is hereby expressly
waived by Borrower.

       11.1.17 Borrower and Lender intend that the relationships created
hereunder and under the other Loan Documents be solely that of borrower and
lender. Nothing herein or therein is intended to create a joint venture,
partnership, tenancy-in-common, or joint tenancy relationship between Borrower
and Lender nor to grant Lender any interest in the Collateral other than that of
pledgee, beneficiary or lender.

       11.1.18 This Agreement and the other Loan Documents are solely for the
benefit of Lender and nothing contained in this Agreement or the other Loan
Documents shall be deemed to confer upon anyone other than Lender any right to
insist upon or to enforce the performance or observance of any of the
obligations contained herein or therein. All conditions to the obligations of
Lender to make the Loan hereunder are imposed solely and exclusively for the
benefit of Lender and no other Person shall have standing to require
satisfaction of such conditions in accordance with their terms or be entitled to
assume that Lender will refuse to make the Loan in the absence of strict
compliance with any or all thereof and no other Person shall under any

                                       39
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circumstances be deemed to be a beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by Lender if, in Lender's sole
discretion, Lender deems it advisable or desirable to do so.

       11.1.19 To the fullest extent permitted by law, Borrower, for itself and
its successors and assigns, waives all rights to a marshalling of the assets of
any Loan Party, and shall not assert any right under any laws pertaining to the
marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the administration of estates of decedents, or any other matters
whatsoever to defeat, reduce or affect the right of Lender under the Loan
Documents to a sale of the Collateral for the collection of the Obligations
without any prior or different resort for collection or of the right of Lender
to the payment of the Obligations out of the net proceeds of the Collateral in
preference to every other claimant whatsoever.

       11.1.20 The Borrower hereby waives the right to assert a counterclaim,
other than a compulsory counterclaim, in any action or proceeding brought
against it by Lender or its agents or otherwise to offset any obligations to
make the payments required by the Loan Documents. No failure by Lender to
perform any of its obligations hereunder shall be a valid defense to, or result
in any offset against, any payments which Borrower is obligated to make under
any of the Loan Documents.

       11.1.21 In the event of any conflict between the provisions of this
Agreement and any of the other Loan Documents, the provisions of this Agreement
shall control. The parties hereto acknowledge that they were represented by
competent counsel in connection with the negotiation, drafting and execution of
the Loan Documents and that such Loan Documents shall not be subject to the
principle of construing their meaning against the party which drafted same. The
Borrower acknowledges that, with respect to the Loan, the Borrower shall rely
solely on its own judgment and advisors in entering into the Loan without
relying in any manner on any statements, representations or recommendations of
Lender or any parent, subsidiary or Affiliate of Lender. Lender shall not be
subject to any limitation whatsoever in the exercise of any rights or remedies
available to it under any of the Loan Documents or any other agreements or
instruments which govern the Loan by virtue of the ownership by it or any
parent, subsidiary or Affiliate of Lender of any equity interest any of them may
acquire in any Loan Party, and the Borrower hereby irrevocably waives the right
to raise any defense or take any action on the basis of the foregoing with
respect to Lender's exercise of any such rights or remedies. The Borrower
acknowledges that Lender engages in the business of real estate financings and
other real estate transactions and investments which may be viewed as adverse to
or competitive with the business of Loan Parties.

       11.1.22 The Borrower hereby represents that, other than as disclosed in
writing to Lender, it has dealt with no financial advisors, brokers,
underwriters, placement agents, agents or finders in connection with the
transactions contemplated by this Agreement. The Borrower shall indemnify,
defend and hold Lender harmless from and against any and all claims,
liabilities, costs and expenses of any kind (including Lender's attorneys' fees
and expenses) in any way relating to or arising from a claim by any Person that
such Person acted on behalf of any Loan Party or Borrower in connection with the
transactions contemplated herein. The Lender hereby represents

                                       40
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that, other than as disclosed in writing to Borrower, it has dealt with no
financial advisors, brokers, underwriters, placement agents, agents or finders
in connection with the transactions contemplated by this Agreement. The Lender
shall indemnify, defend and hold Borrower harmless from and against any and all
claims, liabilities, costs and expenses of any kind (including Borrower's
attorneys' fees and expenses) in any way relating to or arising from a claim by
any Person that such Person acted on behalf of Lender in connection with the
transactions contemplated herein. The provisions of this Section 11.1.22 shall
survive the expiration and termination of this Agreement and the payment of the
Obligations.

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