Document:

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                                                                   Exhibit 10.34

                                                                Loan No. 6518217

              MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY
                                    AGREEMENT

                           Dated as of January 1, 2004

                      INLAND SOUTHEAST NEW BRITAIN, L.L.C.
                                   (Mortgagor)

                                       TO

                       JOHN HANCOCK LIFE INSURANCE COMPANY
                                   (Mortgagee)

                              LOCATION OF PROPERTY:
                               1309 Corbin Street
                            New Britain, Connecticut

                              Record and Return To:

                               Quarles & Brady LLP
                             500 West Madison Street
                                   Suite 3700
                             Chicago, Illinois 60661
                        Attention: Peter A. Sarasek, Esq.

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                                                                Loan No. 6518217

                                TABLE OF CONTENTS

<Table>
<Caption>
                                                                                               Page
                                                                                               ----
<S>  <C>                                                                                         <C>
1.   Payment of Indebtedness and Incorporation of Covenants, Conditions and
       Agreements.................................................................................4
2.   Warranty of Title............................................................................4
3.   Insurance; Casualty..........................................................................5
4.   Payment of Taxes, Etc.......................................................................10
5.   Reserve Fund................................................................................11
6.   Condemnation................................................................................13
7.   Leases and Rents............................................................................14
8.   Maintenance and Use of Mortgaged Property...................................................16
9.   Transfer or Encumbrance of the Mortgaged Property or Interests in the
       Mortgagor; Other Indebtedness.............................................................17
10.  Estoppel Certificates.......................................................................23
11.  No Cooperative or Condominium...............................................................23
12.  Changes in the Laws Regarding Taxation......................................................23
13.  No Credits on Account of the Indebtedness...................................................24
14.  Documentary Stamps..........................................................................24
15.  Right of Entry..............................................................................24
16.  Books and Records...........................................................................24
17.  Performance of Other Agreements.............................................................25
18.  Representations and Covenants Concerning Loan...............................................25
19.  Single Purpose Entity/Separateness..........................................................27
20.  Events of Default; Remedies.................................................................30
21.  Additional Remedies.........................................................................31
22.  Right to Cure Defaults......................................................................34
23.  Late Payment Charge.........................................................................34
24.  Prepayment..................................................................................34
25.  Prepayment After Event of Default...........................................................34
26.  Appointment of Receiver.....................................................................34
27.  Security Agreement..........................................................................35
28.  Authority...................................................................................36
29.  Actions and Proceedings.....................................................................36
30.  Further Acts, Etc...........................................................................36
31.  Recording of Mortgage, Etc..................................................................37
32.  Usury Laws..................................................................................37
33.  Sole Discretion of Mortgagee................................................................37
34.  Recovery of Sums Required To Be Paid........................................................37
35.  Marshalling and Other Matters...............................................................38
36.  Waiver of Notice............................................................................38
37.  Remedies of Mortgagor.......................................................................38
38.  Reporting Requirements......................................................................38
39.  Hazardous Materials.........................................................................38
40.  Asbestos....................................................................................41
41.  Bankruptcy or Insolvency....................................................................41
42.  Compliance with ERISA and State Statutes on Governmental Plans..............................42
43.  Assignments.................................................................................43
44.  Cooperation.................................................................................43
45.  Indemnification for Non-Recourse Carveout Obligations.......................................44
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                                                                Loan No. 6518217

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<S>  <C>                                                                                         <C>
46.  Exculpation.................................................................................44
47.  Notices.....................................................................................45
48.  Non-Waiver..................................................................................46
49.  Joint and Several Liability.................................................................47
50.  Severability................................................................................47
51.  Duplicate Originals.........................................................................47
52.  Indemnity and Mortgagee's Costs.............................................................47
53.  Certain Definitions.........................................................................47
54.  No Oral Change..............................................................................48
55.  No Foreign Person...........................................................................48
56.  Separate Tax Lot............................................................................48
57.  Right to Release Any Portion of the Mortgaged Property......................................48
58.  Subrogation.................................................................................48
59.  Administrative Fees.........................................................................48
60.  Disclosure..................................................................................48
61.  Headings, Etc...............................................................................49
62.  Address of Real Property....................................................................49
63.  Intentionally Deleted.......................................................................49
64.  Publicity...................................................................................49
65.  Relationship................................................................................49
66.  Homestead...................................................................................49
67.  No Third Party Beneficiaries................................................................49
68.  Compliance with Regulation U................................................................49
69.  Entire Agreement............................................................................49
70.  Servicer....................................................................................50
71.  Governing Law; Consent to Jurisdiction......................................................50
72.  Special State Provisions....................................................................50
</Table>

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                                                                Loan No. 6518217

                             INDEX OF DEFINED TERMS

<Table>
<S>                                                                                           <C>
Additional Land...................................................................................1
Architect.........................................................................................7
Assignee.........................................................................................14
Assignment of Leases and Rents...................................................................15
Assignor.........................................................................................14
Bankruptcy Code...................................................................................3
Code.............................................................................................37
Collateral.......................................................................................36
Depository.......................................................................................10
Equipment.........................................................................................2
ERISA............................................................................................43
GAAP.............................................................................................29
Guarantors.......................................................................................28
Guaranty.........................................................................................48
Improvements......................................................................................2
Indebtedness......................................................................................1
Independent Director.............................................................................30
Land..............................................................................................1
Late Charge......................................................................................35
Leases............................................................................................3
Loan..............................................................................................1
Loan Documents...................................................................................48
Management Agreement.............................................................................26
Manager..........................................................................................27
Mortgage..........................................................................................1
Mortgaged Property............................................................................1, 49
Mortgagee.....................................................................................1, 48
Mortgagor.....................................................................................1, 48
Non-Recourse Carveout Obligations................................................................46
Note..........................................................................................1, 48
Other Charges....................................................................................10
Permitted Encumbrances............................................................................5
Person...........................................................................................49
Policies..........................................................................................6
Rating Agencies..................................................................................20
Real Property.....................................................................................2
Rents.........................................................................................3, 15
Repair and Remediation Reserve Fund..............................................................13
Replacement Reserve Agreement....................................................................12
Replacement Reserve Fund.........................................................................12
Reserve Fund.....................................................................................13
Restoration.......................................................................................7
Secondary Market Transactions....................................................................45
Servicer.........................................................................................51
Small Lease......................................................................................15
</Table>

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                                                                Loan No. 6518217

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<S>                                                                                              <C>
SPC Party........................................................................................30
Tax and Insurance Fund...........................................................................11
Taxes............................................................................................10
Tenant Improvement and Leasing Commission Reserve................................................12
Tenant Improvement and Leasing Commission Reserve Fund...........................................13
Termination Amount...............................................................................15
Transferee.......................................................................................19
Uniform Commercial Code...........................................................................2
</Table>

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                                                                Loan No. 6518217

          THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY AGREEMENT
(this "MORTGAGE"), made as of the 1st day of January, 2004, by INLAND SOUTHEAST
NEW BRITAIN, L.L.C., a Delaware limited liability company, having its principal
place of business at 2901 Butterfield Road, Oak Brook, Illinois 60523
("MORTGAGOR"), to and for the benefit of JOHN HANCOCK LIFE INSURANCE COMPANY, a
Massachusetts corporation having its principal place of business at John Hancock
Tower, T-56, 200 Clarendon Street, Boston, Massachusetts 02116 ("MORTGAGEE").

                              W I T N E S S E T H:

          For the consideration of Ten Dollars and other good and valuable
consideration received to its full satisfaction and To secure the payment of an
indebtedness in the principal sum of Eighteen Million One Hundred Fifty Thousand
and No/100 Dollars ($18,150,000.00), lawful money of the United States of
America, to be paid with interest and all other sums and fees payable according
to a certain mortgage note dated the date hereof made by Mortgagor to Mortgagee
(the mortgage note, together with all extensions, renewals or modifications
thereof, being hereinafter collectively called the "NOTE"; and the loan
evidenced by the Note being hereinafter referred to as the "LOAN") and all
indebtedness, obligations, liabilities and expenses due hereunder and under any
other Loan Document (as hereinafter defined) (the indebtedness, interest, other
sums, fees, obligations and all other sums due under the Note and/or hereunder
and/or any other Loan Document being collectively called the "INDEBTEDNESS"),
Mortgagor has mortgaged, given, granted, bargained, sold, alienated, enfeoffed,
conveyed, confirmed, pledged, assigned and hypothecated and by these presents
does mortgage, give, grant, bargain, sell, alien, enfeoff, convey, confirm,
pledge, assign and hypothecate unto Mortgagee and hereby grants unto Mortgagee a
security interest in the following property and rights, whether now owned or
held or hereafter acquired (collectively, the "MORTGAGED PROPERTY"):

                               GRANTING CLAUSE ONE

          All right, title and interest in and to the real property or
properties described on EXHIBIT A hereto (collectively, the "LAND").

                               GRANTING CLAUSE TWO

          All additional lands, estates and development rights hereafter
acquired by Mortgagor for use in connection with the Land and the development of
the Land and all additional lands and estates therein which may, from time to
time, by supplemental mortgage or otherwise, be expressly made subject to the
lien thereof (collectively, the "ADDITIONAL LAND").

                              GRANTING CLAUSE THREE

          Any and all buildings, structures, fixtures, additions, enlargements,
extensions, modifications, repairs, replacements and improvements now or
hereafter located on the Land or any part thereof (collectively, the
"IMPROVEMENTS"; the Land, the Additional Land and the Improvements hereinafter
collectively referred to as the "REAL PROPERTY").

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                                                                Loan No. 6518217

                              GRANTING CLAUSE FOUR

          All easements, rights-of-way, strips and gores of land, streets, ways,
alleys, passages, sewer rights, water, water courses, water rights and powers,
oil, gas and mineral rights, air rights and development rights, zoning rights,
tax credits or benefits and all estates, rights, titles, interests, privileges,
liberties, tenements, hereditaments and appurtenances of any nature whatsoever
in any way now or hereafter belonging, relating or pertaining to the Real
Property or any part thereof and the reversion and reversions, remainder and
remainders and all land lying in the bed of any street, road or avenue, opened
or proposed, in front of or adjoining the Land or any part thereof to the center
line thereof and all the estates, rights, titles, interests, dower and rights of
dower, curtesy and rights of curtesy, property, possession, claim and demand
whatsoever, both in law and in equity, of Mortgagor in, of and to the Real
Property and every part and parcel thereof, with the appurtenances thereto.

                              GRANTING CLAUSE FIVE

          All machinery, equipment, fixtures and other property of every kind
and nature whatsoever owned by Mortgagor or in which Mortgagor has or shall have
an interest (to the extent of such interest) now or hereafter located upon the
Real Property or appurtenant thereto and usable in connection with the present
or future operation and occupancy of the Real Property and all building
equipment, materials and supplies of any nature whatsoever owned by Mortgagor or
in which Mortgagor has or shall have an interest (to the extent of such
interest) now or hereafter located upon the Real Property or appurtenant thereto
or usable in connection with the present or future operation and occupancy of
the Real Property, including but not limited to all heating, ventilating, air
conditioning, plumbing, lighting, communications and elevator machinery,
equipment and fixtures (hereinafter collectively called the "EQUIPMENT") and the
right, title and interest of Mortgagor in and to any of the Equipment which may
be subject to any security agreements (as defined in the Uniform Commercial Code
of the State in which the Mortgaged Property is located (the "UNIFORM COMMERCIAL
CODE")) superior, inferior or PARI PASSU in lien to the lien of this Mortgage.
In connection with Equipment which is leased to Mortgagor or which is subject to
a lien or security interest which is superior to the lien of this Mortgage, this
Mortgage shall also cover all right, title and interest of each Mortgagor in and
to all deposits and the benefit of all payments now or hereafter made with
respect to such Equipment.

                               GRANTING CLAUSE SIX

          All awards or payments, including interest thereon, which may
heretofore and hereafter be made with respect to the Real Property or any part
thereof, whether from the exercise of the right of eminent domain (including but
not limited to any transfer made in lieu of or in anticipation of the exercise
of said right), or for a change of grade or for any other injury to or decrease
in the value of the Real Property.

                              GRANTING CLAUSE SEVEN

          All leases and subleases (including, without limitation, all
guarantees thereof) and other agreements affecting the use, enjoyment and/or
occupancy of the Real Property or any part

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                                                                Loan No. 6518217

thereof, now or hereafter entered into (including any use or occupancy
arrangements created pursuant to Section 365(h) of Title 11 of the United States
Code (the "BANKRUPTCY CODE") or otherwise in connection with the commencement or
continuance of any bankruptcy, reorganization, arrangement, insolvency,
dissolution, receivership or similar proceedings or any assignment for the
benefit of creditors in respect of any tenant or occupant of any portion of the
Real Property), together with any extension or renewal of the same (the
"LEASES") and all income, rents, issues, profits, revenues and proceeds
including, but not limited to, all oil and gas or other mineral royalties and
bonuses from the Real Property (including any payments received pursuant to
Section 502(b) of the Bankruptcy Code or otherwise in connection with the
commencement or continuance of any bankruptcy, reorganization, arrangement,
insolvency, dissolution, receivership or similar proceedings or any assignment
for the benefit of creditors in respect of any tenant or occupant of any portion
of the Real Property and all claims as a creditor in connection with any of the
foregoing) (the "RENTS") and all proceeds from the sale, cancellation, surrender
or other disposition of the Leases and the right to receive and apply the Rents
to the payment of the Indebtedness.

                              GRANTING CLAUSE EIGHT

          All proceeds of and any unearned premiums on any insurance policies
covering the Real Property or any part thereof including, without limitation,
the right to receive and apply the proceeds of any insurance, judgments or
settlements made in lieu thereof, for damage to the Real Property or any part
thereof.

                              GRANTING CLAUSE NINE

          All tax refunds, including interest thereon, tax credits and tax
abatements and the right to receive or benefit from the same, which may be
payable or available with respect to the Real Property.

                               GRANTING CLAUSE TEN

          The right, in the name and on behalf of Mortgagor, to appear in and
defend any action or proceeding brought with respect to the Real Property or any
part thereof and to commence any action or proceeding to protect the interest of
Mortgagee in the Real Property or any part thereof.

                             GRANTING CLAUSE ELEVEN

          All accounts receivable, utility or other deposits, intangibles,
contract rights, interests, estates or other claims, both in law and in equity,
which Mortgagor now has or may hereafter acquire in the Real Property or any
part thereof.

                             GRANTING CLAUSE TWELVE

          All rights which Mortgagor now has or may hereafter acquire to be
indemnified and/or held harmless from any liability, loss, damage, cost or
expense (including, without limitation, attorneys' fees and disbursements)
relating to the Real Property or any part thereof.

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                                                                Loan No. 6518217

                            GRANTING CLAUSE THIRTEEN

          All plans and specifications, maps, surveys, studies, reports,
contracts, subcontracts, service contracts, management contracts, franchise
agreements and other agreements, franchises, trade names (excluding any trade
names to the extent they include therein the name "Inland"), trademarks
(excluding any trademarks to the extent they include therein the name "Inland"),
symbols, service marks, approvals, consents, permits, special permits, licenses
and rights, whether governmental or otherwise, respecting the use, occupation,
development, construction and/or operation of the Real Property or any part
thereof or the activities conducted thereon or therein, or otherwise pertaining
to the Real Property or any part thereof.

                            GRANTING CLAUSE FOURTEEN

          All proceeds, products, offspring, rents and profits from any of the
foregoing, including without limitation, those from sale, exchange, transfer,
collection, loss, damage, disposition, substitution or replacement of any of the
foregoing.

          WITH RESPECT to any portion of the Mortgaged Property which is not
real estate under the laws of the State in which the Mortgaged Property is
located, Mortgagor hereby grants, bargains, sells and conveys the same to
Mortgagee for the purposes set forth hereunder and Mortgagee shall be vested
with all rights, power and authority granted hereunder or by law to Mortgagee
with respect thereto.

          TO HAVE AND TO HOLD the above granted and described Mortgaged Property
unto and to the use and benefit of Mortgagee and the successors and assigns of
Mortgagee forever.

          PROVIDED, HOWEVER, these presents are upon the express condition, if
Mortgagor shall well and truly pay to Mortgagee the Indebtedness at the time and
in the manner provided in the Note and this Mortgage and shall well and truly
abide by and comply with each and every covenant and condition set forth herein,
in the Note and in the other Loan Documents, these presents and the estate
hereby granted shall cease, terminate and be void.

          AND Mortgagor represents and warrants to and covenants and agrees with
Mortgagee as follows:

                           PART I - GENERAL PROVISIONS

          1.   PAYMENT OF INDEBTEDNESS AND INCORPORATION OF COVENANTS,
CONDITIONS AND AGREEMENTS. Mortgagor shall pay the Indebtedness at the time and
in the manner provided in the Note, this Mortgage and the other Loan Documents.
All the covenants, conditions and agreements contained in the Note and the other
Loan Documents are hereby made a part of this Mortgage to the same extent and
with the same force as if fully set forth herein.

          2.   WARRANTY OF TITLE. Mortgagor has good and marketable title to
the Mortgaged Property; Mortgagor has the right to mortgage, give, grant,
bargain, sell, alienate,

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                                                                Loan No. 6518217

enfeoff, convey, confirm, pledge, lease, assign, hypothecate and grant a
security interest in the Mortgaged Property; Mortgagor possesses an indefeasible
fee estate in the Real Property; and Mortgagor owns the Mortgaged Property free
and clear of all liens, encumbrances and charges whatsoever except those
exceptions shown in the title insurance policy insuring the lien of this
Mortgage (this Mortgage and the liens, encumbrances and charges shown as
exceptions in such title policy, hereinafter collectively referred to as the
"PERMITTED ENCUMBRANCES"). Mortgagor shall forever warrant, defend and preserve
such title and the validity and priority of the lien of this Mortgage and shall
forever warrant and defend the same to Mortgagee against the claims of all
persons whomsoever.

          3.   INSURANCE; CASUALTY.

               (a)    Mortgagor, at its sole cost and expense, shall keep the
Mortgaged Property insured during the term of this Mortgage for the mutual
benefit of Mortgagor and Mortgagee against loss or damage by any peril covered
by a standard "special perils" or "all-risk-of-physical-loss" insurance policy
including, without limitation, riot and civil commotion, acts of terrorism,
vandalism, malicious mischief, burglary, theft and mysterious disappearance in
an amount (i) equal to at least one hundred percent (100%) of the then "full
replacement cost" of the Improvements and Equipment, without deduction for
physical depreciation and (ii) such that the insurer would not deem Mortgagor a
coinsurer under such policies. The policies of insurance carried in accordance
with this PARAGRAPH 3 shall be paid annually in advance and shall contain the
"Replacement Cost Endorsement" with a waiver of depreciation, and shall have a
deductible no greater than $10,000 unless so agreed by Mortgagee.

               (b)    Mortgagor, at its sole cost and expense, for the mutual
benefit of Mortgagor and Mortgagee, shall also obtain and maintain during the
term of this Mortgage the following policies of insurance:

               (i)    Flood insurance if any part of the Real Property is
     located in an area identified by the Secretary of Housing and Urban
     Development as an area having special flood hazards and in which flood
     insurance has been made available under the National Flood Insurance Act of
     1968 (and any successor act thereto) in an amount at least equal to the
     outstanding principal amount of the Note or the maximum limit of coverage
     available with respect to the Improvements and Equipment under said Act,
     whichever is less.

               (ii)   Comprehensive public liability insurance, including broad
     form property damage, blanket contractual and personal injuries (including
     death resulting therefrom) coverages.

               (iii)  Rental loss insurance in an amount equal to at least one
     hundred percent (100%) of the aggregate annual amount of all rents and
     additional rents payable by all of the tenants under the Leases (whether or
     not such Leases are terminable in the event of a fire or casualty), such
     rental loss insurance to cover rental losses for a period of at least one
     (1) year after the date of the fire or casualty in question. The amount of
     such rental loss insurance shall be adjusted no less frequently than
     annually during the term of this Mortgage to reflect all increased rent and
     increased additional rent payable by all of

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                                                                Loan No. 6518217

     the tenants under renewal Leases entered into in accordance with the terms
     of this Mortgage and all rent and additional rent payable by all of the
     tenants under new Leases entered into in accordance with the terms of this
     Mortgage.

               (iv)   Insurance against loss or damage from explosion of steam
     boilers, air conditioning equipment, high pressure piping, machinery and
     equipment, pressure vessels or similar apparatus now or hereafter installed
     in the Improvements.

               (v)    Such other insurance (including, without limitation,
     earthquake insurance) as may from time to time be reasonably required by
     Mortgagee in order to protect its interests or, in the event of a Secondary
     Market Transaction, as required by the Rating Agencies (as such terms are
     hereinafter defined).

               (c)    All policies of insurance (the "POLICIES") required
pursuant to this PARAGRAPH 3 (i) shall be issued by an insurer satisfactory to
Mortgagee (and, in the event of a Secondary Market Transaction, to the Rating
Agencies), (ii) shall contain the standard New York mortgagee non-contribution
clause naming Mortgagee as the person to which all payments made by such
insurance company shall be paid, (iii) shall be maintained throughout the term
of this Mortgage without cost to Mortgagee, (iv) shall be delivered to
Mortgagee, (v) shall contain such provisions as Mortgagee deems reasonably
necessary or desirable to protect its interest including, without limitation,
endorsements providing that neither Mortgagor, Mortgagee nor any other party
shall be a co-insurer under such Policies and that Mortgagee shall receive at
least thirty (30) days prior written notice of any modification or cancellation
and (vi) shall be reasonably satisfactory in form and substance to Mortgagee
(and, in the event of a Secondary Market Transaction, to the Rating Agencies)
and shall be approved by Mortgagee (and, in the event of a Secondary Market
Transaction, by the Rating Agencies) as to amounts, form, risk coverage,
deductibles, loss payees and insureds. All amounts recoverable thereunder are
hereby assigned to the Mortgagee. Not later than thirty (30) days prior to the
expiration date of each of the Policies, Mortgagor will deliver to Mortgagee
satisfactory evidence of the renewal of each of the Policies.

               (d)    If the Improvements shall be damaged or destroyed, in
whole or in part, by fire or other casualty, Mortgagor shall give prompt notice
thereof to Mortgagee and prior to the making of any repairs thereto. Following
the occurrence of fire or other casualty, Mortgagor, regardless of whether
insurance proceeds are payable under the Policies or, if paid, are made
available to Mortgagor by Mortgagee, shall promptly proceed with the repair,
alteration, restoration, replacement or rebuilding of the Improvements as near
as possible to their value, utility, condition and character prior to such
damage or destruction. Such repairs, alterations, restoration, replacement and
rebuilding are herein collectively referred to as the "RESTORATION". The
Restoration shall be performed in accordance with the following provisions:

               (i)    Mortgagor shall procure, pay for and furnish to Mortgagee
     true copies of all required governmental permits, certificates and
     approvals with respect to the Restoration.

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                                                                Loan No. 6518217

               (ii)   Mortgagor shall furnish Mortgagee, within thirty (30) days
     of the casualty, evidence reasonably satisfactory to Mortgagee of the cost
     to complete the Restoration.

               (iii)  If the Restoration involves structural work or the
     estimated cost to complete the Restoration exceeds five percent (5%) of the
     original principal amount of the Loan, the Restoration shall be conducted
     under the supervision of an architect (the "ARCHITECT") selected by
     Mortgagor and approved by Mortgagee (which approval shall not be
     unreasonably withheld), and no such Restoration shall be made except in
     accordance with detailed plans and specifications, detailed cost estimates
     and detailed work schedules approved by Mortgagee (which approval shall not
     be unreasonably withheld).

               (iv)   If the estimated cost of the Restoration shall exceed
     twenty-five percent (25%) of the fair market value of the Mortgaged
     Property, at the request of Mortgagee, Mortgagor, before commencing any
     work, shall cause to be furnished to Mortgagee a surety bond or bonds, in
     form and substance reasonably satisfactory to Mortgagee, naming Mortgagor
     and Mortgagee as co-obligees, in an amount that is not less than the
     estimated cost of the Restoration, issued by a surety company or companies
     reasonably satisfactory to Mortgagee.

               (v)    The Restoration shall be prosecuted to completion with all
     due diligence and in an expeditious and first class workmanlike manner and
     in compliance with all laws and other governmental requirements, all
     permits, certificates and approvals, all requirements of fire underwriters
     and all insurance policies then in force with respect to the Real Property.

               (vi)   At all times when any work is in progress, Mortgagor shall
     maintain all insurance then required by law or customary with respect to
     such work, and, prior to the commencement of any work, shall furnish to
     Mortgagee duplicate originals or certificates of the policies therefor.

               (vii)  Upon completion of the Restoration, Mortgagor shall obtain
     (A) any occupancy permit which may be required for the Improvements and (B)
     all other governmental permits, certificates and approvals and all permits,
     certificates and approvals of fire underwriters which are required for or
     with respect to the Restoration, and shall furnish true copies thereof to
     Mortgagee.

               (viii) An Event of Default (as hereinafter defined) shall be
     deemed to have occurred under this Mortgage if Mortgagor, after having
     commenced demolition or construction of any Improvements, shall abandon
     such demolition or the construction work or shall fail to complete such
     demolition and construction within a reasonable time after the commencement
     thereof.

               (e)    If the estimated cost of the Restoration is $50,000.00 or
less, and so long as no Event of Default then exists under any of the Loan
Documents, Mortgagor shall be entitled to adjust and settle the insurance claim
without the consent or participation of Mortgagee

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                                                                Loan No. 6518217

and Mortgagor shall be entitled to receive the payment for such loss. Mortgagor
and Mortgagee shall jointly adjust and settle all insurance claims over
$50,000.00, PROVIDED, HOWEVER, if an Event of Default shall have occurred and be
continuing, Mortgagee shall have the right to adjust and settle such claims
without the prior consent of Mortgagor. In the event of any insured loss, the
payment for such loss shall be made directly to Mortgagee. Any insurance
proceeds payable under any of the Policies in excess of $50,000.00 (and, if an
Event of Default then exists hereunder, any insurance proceeds of $50,000.00 or
less) may, at the option of Mortgagee, be used in one or more of the following
ways: (w) applied to the Indebtedness, whether such Indebtedness then be matured
or unmatured (such application to be without prepayment fee or premium, except
that if an Event of Default, or an event which with notice and/or the passage of
time, or both, would constitute an Event of Default, has occurred and remains
uncured, then such application shall be subject to the applicable premium
computed in accordance with the Note), (x) used to fulfill any of the covenants
contained herein as the Mortgagee may determine, (y) used to replace or restore
the property to a condition satisfactory to the Mortgagee, or (z) released to
the Mortgagor. Notwithstanding the foregoing, provided: (i) not more than forty
percent (40%) of the gross area of the Improvements is directly affected by such
damage, destruction or loss and the amount of the loss does not exceed
twenty-five percent (25%) of the fair market value of the Mortgaged Property,
(ii) no Event of Default or event that with the passage of time or giving of
notice or both would constitute a default has occurred hereunder, under the Note
or under any of the other Loan Documents and remains uncured at the time of such
application, (iii) the insurer does not deny liability to any named insured,
(iv) each major and/or anchor tenant (as determined by Mortgagee) whose Lease
permits termination thereof as a result of such insured loss, agrees in writing
to continue its Lease, (v) rental loss insurance is available and in force and
effect to offset in full any abatement of rent to which any tenant may be
entitled as a result of such damage, destruction or loss, (vi) the remaining
Improvements continue at all times to comply with all applicable building,
zoning and other land use laws and regulations, (vii) in Mortgagee's judgment,
the Restoration is practicable and can be completed within one (1) year after
the damage, destruction or loss and at least one (1) year prior to the Maturity
Date (as such term is defined in the Note), and (viii) rebuilding of the
Improvements to substantially identical size, condition and use as existed prior
to the casualty is permitted by all applicable laws and ordinances, then all of
such proceeds shall be used for Restoration. Notwithstanding the foregoing, such
proceeds shall be used for Restoration to the extent required under the terms of
any existing leases of any portion of the Mortgaged Property. Any application of
insurance proceeds to the Indebtedness shall be to the unpaid installments of
principal due under the Note in the inverse order of their maturity, such that
the regular payments under the Note shall not be reduced or altered in any
manner. In the event the above criteria are satisfied (including that no Event
of Default or event that, with the passage of time or giving of notice or both,
would constitute a default has occurred hereunder, under the Note or other Loan
Documents) or Mortgagee otherwise elects to allow the use of such proceeds for
the Restoration, such proceeds shall be disbursed in accordance with the
following provisions:

               (i)    Each request for an advance of insurance proceeds shall be
     made on seven (7) days' prior notice to Mortgagee and shall be accompanied
     by a certificate of the Architect, if one be required under PARAGRAPH
     3(d)(iii) above, otherwise by an executive officer or managing general
     partner or managing member of Mortgagor, stating (A) that all work
     completed to date has been performed in compliance with the approved plans
     and specifications and in accordance with all provisions of law, (B) the
     sum

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                                                                Loan No. 6518217

     requested is properly required to reimburse Mortgagor for payments by
     Mortgagor to, or is properly due to, the contractor, subcontractors,
     materialmen, laborers, engineers, architects or other persons rendering
     services or materials for the Restoration (giving a brief description of
     such services and materials), and that when added to all sums, if any,
     previously disbursed by Mortgagee, does not exceed the value of the work
     done to the date of such certificate and (C) that the amount of such
     proceeds remaining in the hands of Mortgagee will be sufficient on
     completion of the work to pay the same in full (giving, in such reasonable
     detail as Mortgagee may require, an estimate of the cost of such
     completion).

               (ii)   Each request for an advance of insurance proceeds shall,
     to the extent permitted under applicable law, be accompanied by waivers of
     liens satisfactory to Mortgagee covering that part of the Restoration
     previously paid for, if any, and by a search prepared by a title company or
     by other evidence reasonably satisfactory to Mortgagee including without
     limitation a title endorsement satisfactory to Mortgagee if available in
     the state where the Real Property is located, that there has not been filed
     with respect to the Real Property any mechanic's lien or other lien or
     instrument and that there exist no encumbrances on or affecting the Real
     Property other than the Permitted Encumbrances or otherwise approved by
     Mortgagee. In addition to the foregoing, the request for the final advance
     shall be accompanied by (A) any final occupancy permit which may be
     required for the Improvements, (B) all other governmental permits,
     certificates and approvals and all other permits necessary for the
     occupancy and operation of the Real Property, (C) Tenant estoppels from
     tenants whose space was affected and (D) final lien waivers from all
     contractors, subcontractors and materialmen.

               (iii)  No advance of insurance proceeds shall be made if there
     exists an Event of Default or event which with the passage of time or the
     giving of notice or both would constitute a default on the part of
     Mortgagor under this Mortgage, the Note or any other Loan Document.

               (iv)   If the cost of the Restoration (as reasonably estimated by
     Mortgagee) at any time shall exceed the amount of the insurance proceeds
     available therefor, insurance proceeds shall not be advanced until
     Mortgagor, before commencing the Restoration or continuing the Restoration,
     as the case may be, shall deposit the full amount of the deficiency (or
     other assurances reasonably satisfactory to Mortgagee) with Mortgagee and
     the amount so deposited shall first be applied toward the cost of the
     Restoration before any portion of the insurance proceeds is disbursed for
     such purpose.

          Upon completion of the Restoration and payment in full therefor, or
upon failure on the part of Mortgagor promptly to commence or diligently to
continue the Restoration, or at any time upon request by Mortgagor, Mortgagee
may apply the amount of any such proceeds then or thereafter in the hands of
Mortgagee to the payment of the Indebtedness; PROVIDED, HOWEVER, that nothing
herein contained shall prevent Mortgagee from applying at any time the whole or
any part of such proceeds to the curing of any default that has not been cured
within the applicable cure period under this Mortgage, the Note or any other
Loan Document.

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                                                                Loan No. 6518217

               (f)    Insurance proceeds and any additional funds deposited by
Mortgagor with Mortgagee shall constitute additional security for the
Indebtedness. Mortgagor shall execute, deliver, file and/or record, at its
expense, such documents and instruments as Mortgagee deems necessary or
advisable to grant to Mortgagee a perfected, first priority security interest in
the insurance proceeds and such additional funds. If Mortgagee elects to have
the insurance proceeds applied to Restoration, (i) the insurance proceeds shall
be, at Mortgagee's election, disbursed in installments by Mortgagee or by a
disbursing agent ("DEPOSITORY") selected by Mortgagee and whose fees and
expenses shall be paid by Mortgagor in the manner provided in PARAGRAPH 3(e)
above and (ii) all costs and expenses incurred by Mortgagee in connection with
the Restoration, including, without limitation, reasonable counsel fees and
costs, shall be paid by Mortgagor.

          4.   PAYMENT OF TAXES, ETC.

               (a)    Mortgagor Shall pay or cause to be paid all taxes,
assessments, water rates and sewer rents, now or hereafter levied or assessed or
imposed against the Mortgaged Property or any part thereof (the "TAXES") and all
ground rents, maintenance charges, other governmental impositions, and other
charges, including, without limitation, vault charges and license fees
(collectively, "Other Charges") for the use of vaults, chutes and similar areas
adjoining the Real Property, as same become due and payable. Mortgagor will
deliver to Mortgagee, promptly upon Mortgagee's request, evidence satisfactory
to Mortgagee that the Taxes and Other Charges have been so paid and are not then
delinquent. Mortgagor shall not suffer or permit any lien or charge (including,
without limitation, any mechanic's lien) against all or any part of the
Mortgaged Property and Mortgagor shall promptly cause to be paid and discharged
any lien or charge whatsoever which may be or become a lien or charge against
the Mortgaged Property. Mortgagor shall promptly pay for all utility services
provided to the Mortgaged Property. In addition, Mortgagee may, at its option,
retain the services of a firm to monitor the payment of Taxes, the cost of which
shall be borne by Mortgagor.

               (b)    Notwithstanding the provisions of subsection (a) of this
Paragraph 4, Mortgagor shall have the right to contest in good faith the amount
or validity of any such Taxes, liens or Other Charges (including, without
limitation, tax liens and mechanic's liens) referred to in subsection (a) above
by appropriate legal proceedings and in accordance with all applicable law,
after notice to, but without cost or expense to, Mortgagee, provided that (i) no
Event of Default or event that, with the passage of time or giving of notice or
both, would constitute a default hereunder, under the Note or other Loan
Documents has occurred and is continuing, (ii) Mortgagor pays such Taxes, liens
or Other Charges as same become due and payable, unless Mortgagor delivers
evidence satisfactory to Mortgagee that, as a result of Mortgagor's contest,
Mortgagor's obligation to pay such Taxes, liens or Other Charges has been
deferred by the appropriate governmental authority, in which event, Mortgagor
may defer such payment of such Taxes, liens or Other Charges until the date
specified by such governmental authority, (iii) such contest shall be promptly
and diligently prosecuted by and at the expense of Mortgagor, (iv) Mortgagee
shall not thereby suffer any civil penalty, or be subjected to any criminal
penalties or sanctions, (v) such contest shall be discontinued and such Taxes,
liens or Other Charges promptly paid if at any time all or any part of the
Mortgaged Property shall be in imminent danger of being foreclosed, sold,
forfeited or otherwise lost or if the title, lien and security interest created
by this Mortgage or the priority thereof shall be in imminent danger of

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                                                                Loan No. 6518217

being impaired, (vi) Mortgagor shall have set aside adequate reserves (in
Mortgagee's judgment) for the payment of such Taxes, liens or Other Charges,
together with all interest and penalties thereon and (vii) Mortgagor shall have
furnished such security as may be reasonably required in the proceeding or as
may be requested by Mortgagee, to insure the payment of any such Taxes, liens or
Other Charges, together with all interest and penalties thereon.

          5.   RESERVE FUND.

               (a)    TAX AND INSURANCE FUND. Mortgagor shall pay to Mortgagee
on the first day of each calendar month such amounts as Mortgagee from time to
time estimates to be sufficient to create and maintain a reserve fund from which
(i) to pay the Taxes and Other Charges, at least thirty (30) days prior to the
date they are due without the payment of any penalties or interest, and (ii) to
pay, at least thirty (30) days prior to their due date for the renewal of the
coverage afforded by the Policies upon the expiration thereof, the insurance
premiums for the Policies estimated by Mortgagee to be payable on such due date,
(said amounts in (i) and (ii) above hereafter called the "Tax and Insurance
Fund").

                      (1)    Notwithstanding the foregoing clause (i) of this
subsection (a), provided (X) Inland Southeast New Britain, L.L.C. or a Permitted
Affiliated Transferee, as defined in Paragraph 9(h) below, or a Transferee
approved by Mortgagee pursuant to Paragraph 9(f) below is and remains the owner
of the Mortgaged Property, (Y) no Event of Default has occurred and is
continuing under this Mortgage or any of the Loan Documents beyond any
applicable notice or cure period, (Z) Mortgagor pays such Taxes and Other
Charges prior to the date they are due and prior to the assessment of any
penalties or interest and provides, upon request, evidence of such timely
payment to Mortgagee, then Mortgagee will not require Mortgagor to make the
deposits referred to in clause (i) of this subsection (a). In the event
Mortgagor is hereafter required to make the deposits referred to in clause (i)
of this subsection (a) on account of Mortgagor's failure to satisfy all of the
requirements of the preceding sentence, Mortgagor agrees at Mortgagor's sole
cost and expense, upon request thereafter of Mortgagee, to promptly execute and
deliver to Mortgagee a written agreement for the making of such deposits in the
future.

                      (2)    Notwithstanding the foregoing clause (ii) of this
subsection (a), provided (X) no Event of Default has occurred and is continuing
under this Mortgage or any of the Loan Documents beyond any applicable notice or
cure period, (Y) Inland Southeast New Britain, L.L.C. or a Permitted Affiliated
Transferee, as defined in Paragraph 9(h) below, or a Transferee approved by
Mortgagee pursuant to Paragraph 9(f) below is and remains the owner of the
Mortgaged Property, and (Z) Mortgagor complies in full with all obligations in
the Loan Documents regarding insurance, including without limitation providing
Mortgagee with timely evidence (i) that the required insurance is in place for
the Mortgaged Property and is never delinquent or suspended, and (ii) that all
insurance premiums are paid when due, then Mortgagee will not require Mortgagor
to make the deposits referred to in clause (ii) of this subsection (a). In the
event Mortgagor is hereafter required to make the deposits referred to in clause
(ii) of this subsection (a) on account of Mortgagor's failure to satisfy all of
the requirements of the preceding sentence, Mortgagor agrees at Mortgagor's sole
cost and expense, upon request thereafter of Mortgagee, to promptly execute and
deliver to Mortgagee a written agreement for the making of such deposits in the
future.

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                                                                Loan No. 6518217

               (b)    REPLACEMENT RESERVE FUND. If required by Mortgagee,
Mortgagor shall enter into a Replacement Reserve Agreement which shall require
Mortgagor to pay to Mortgagee on the first day of each calendar month one
twelfth (1/12) of the amount reasonably estimated by Mortgagee to be due for the
replacements and capital repairs required to be made to the Mortgaged Property
during each calendar year (the "REPLACEMENT RESERVE FUND"). Mortgagee shall make
disbursements from the Replacement Reserve Fund for items specified in the
Replacement Reserve Agreement as set forth in such Agreement. Mortgagee may
require an inspection of the Mortgaged Property prior to making a disbursement
in order to verify completion of replacements and repairs. Mortgagee reserves
the right to make any disbursement from the Replacement Reserve Fund directly to
the party furnishing materials and/or services.

               Notwithstanding the foregoing, provided: (W) no Event of Default
has occurred and is continuing under this Mortgage or any of the Loan Documents
beyond any applicable notice or cure period, (X) Inland Southeast New Britain,
L.L.C. or a Permitted Affiliated Transferee, as defined in Paragraph 9(h) below,
or a Transferee approved by Mortgagee pursuant to Paragraph 9(f) below is and
remains the owner of the Mortgaged Property, (Y) Mortgagor has complied in full
with all obligations set forth in this Mortgage and in the other Loan Documents
regarding maintaining the Mortgaged Property, including without limitation
maintaining the Mortgaged Property in good order and repair, and (Z) inspections
of the Mortgaged Property do not uncover the necessity of creating or
reinstating the Replacement Reserve Fund, in Mortgagee's sole discretion, then
Mortgagee will not require Mortgagor to make the deposits referred to in this
subsection (b). In the event Mortgagor is hereafter required to make the
deposits referred to in this subsection (b) on account of Mortgagor's failure to
satisfy all of the requirements of the preceding sentence, Mortgagor agrees at
Mortgagor's sole cost and expense, upon request thereafter of Mortgagee, to
promptly execute and deliver to Mortgagee a written agreement for the making of
such deposits in the future.

               (c)    TENANT IMPROVEMENT AND LEASING COMMISSION RESERVE. If
required by Mortgagee, Mortgagor shall enter into a Tenant Improvement and
Leasing Commission Agreement which shall require Mortgagor to pay to Mortgagee
on the first day of each calendar month deposits for tenant improvements and
leasing commissions in amounts determined by Mortgagee in its sole discretion,
for payment of costs and expenses incurred by Mortgagor in connection with the
performance of work to refit and release space in the Improvements that is
currently vacant or anticipated to be vacated during the term of the Loan, and
for payment of leasing commissions incurred by Mortgagor in Connection with the
releasing of space in the Improvements that is currently vacant or anticipated
to be vacated during the term of the Loan (the "TENANT IMPROVEMENT AND LEASING
COMMISSION RESERVE FUND"), all according to the Tenant Improvement and Leasing
Commission Agreement.

               Notwithstanding the foregoing, provided no Event of Default has
occurred and is continuing under this Mortgage or any of the Loan Documents
beyond any applicable notice or cure period and no condition or event exists
which with notice, the passage or time, or both, would constitute an Event of
Default under this Mortgage or any of the Loan Documents, then Mortgagee will
not require Mortagor to make the deposits referred to in this subsection (c). In
the event Mortgagor is hereafter required to make the deposits referred to in
this subsection (c) on account of Mortgagor's failure to satisfy all of the
requirements of the preceding sentence, Mortgagor agrees at Mortgagor's sole
cost and expense, upon request thereafter of Mortgagee, to

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                                                                Loan No. 6518217

promptly execute and deliver to Mortgagee a written agreement for the making of
such deposits in the future.

               (d)    REPAIR AND REMEDIATION RESERVE FUND. If required by
Mortgagee, Mortgagor shall enter into a Reserve Agreement for Repairs and shall
pay to Mortgagee the estimated cost to complete any required repairs (the
"REPAIR AND REMEDIATION RESERVE FUND") as more fully set forth in said
Agreement. Notwithstanding anything herein to the contrary, Mortgagee agrees
that the Repair and Remediation Reserve Fund shall not be required if the
aggregate cost to repair all items set forth in any applicable Property
Condition Assessment, Environmental Assessment or other report is less than
$150,000.00.

          The amounts in (a),(b),(c) and (d) above shall hereinafter be
collectively called the "RESERVE FUND". Mortgagor hereby pledges to Mortgagee
any and all monies now or hereafter deposited as the Reserve Fund as additional
security for the payment of the Indebtedness. Mortgagee may apply the Reserve
Fund to payments of Taxes, Other Charges, insurance premiums and, as applicable,
payments for replacements and capital repairs, tenant improvements and leasing
commissions and repairs and remediations required to be made by Mortgagor
pursuant to the terms hereof or pursuant to the terms of any other Loan
Documents (even though subsequent owners of the Mortgaged Property may benefit
thereby); PROVIDED, HOWEVER, if there is an Event of Default which is
continuing, then Mortgagee may credit such Reserve Fund against the Indebtedness
in such priority and proportions as Mortgagee in its discretion shall deem
proper. If the Reserve Fund is not sufficient to fully pay for the Taxes, Other
Charges and/or the insurance premiums or, as applicable, amounts for
replacements and capital repairs, tenant improvements and leasing commissions
and repairs and remediation when due, Mortgagor shall promptly pay to Mortgagee,
upon demand, an amount which Mortgagee shall estimate as sufficient to make up
the deficiency. The Reserve Fund shall not constitute a trust fund and may be
commingled with other monies held by Mortgagee. No earnings or interest on the
Reserve Fund shall be payable to Mortgagor.

          6.   CONDEMNATION.  Mortgagor shall promptly give Mortgagee written
notice of the actual or threatened commencement of any condemnation or eminent
domain proceeding and shall deliver to Mortgagee copies of any and all papers
served in connection with such proceedings. Following the occurrence of a
condemnation, Mortgagor, regardless of whether an award is available, shall
promptly proceed to restore, repair, replace or rebuild the Improvements to the
extent practicable to be of at least equal value and of substantially the same
character as prior to such condemnation, all to be effected in accordance with
applicable law. Notwithstanding any taking by any public or quasi-public
authority through eminent domain or otherwise (including but not limited to any
transfer made in lieu of or in anticipation of the exercise of such taking),
Mortgagor shall continue to pay the Indebtedness at the time and in the manner
provided for its payment in the Note, in this Mortgage and the other Loan
Documents and the Indebtedness shall not be reduced until any award or payment
therefor shall have been actually received after expenses of collection and
applied by Mortgagee to the discharge of the Indebtedness. Mortgagor shall cause
the award or payment made in any condemnation or eminent domain proceeding,
which is payable to Mortgagor, to be paid directly to Mortgagee. Mortgagee may,
at Mortgagee's election, use the award in any one or more of the following ways:
(a) apply any such award or payment (for purposes of this PARAGRAPH 6, the award
or payment that may be made in any condemnation or eminent domain proceeding
shall mean the

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                                                                Loan No. 6518217

entire award allocated to Mortgagor in any capacity) to the discharge of the
Indebtedness whether or not then due and payable (such application to be without
prepayment fee or premium, except that if an Event of Default, or an event which
with notice and/or the passage of time, or both, would constitute an Event of
Default, has occurred, then such application shall be subject to the applicable
premium computed in accordance with the Note), (b) use the same or any part
thereof to fulfill any of the covenants contained herein as the Mortgagee may
determine, (c) use the same or any part thereof to replace or restore the
Mortgaged Property to a condition satisfactory to the Mortgagee, or (d) release
the same to the Mortgagor. If the Mortgaged Property is sold, through
foreclosure or otherwise, prior to the receipt by Mortgagee of such award or
payment, Mortgagee shall have the right, whether or not a deficiency judgment on
the Note shall have been sought, recovered or denied, to receive said award or
payment or a portion thereof sufficient to pay the Indebtedness.

          7.   LEASES AND RENTS.

               (a)    Mortgagor does hereby absolutely and unconditionally
assign to Mortgagee its right, title and interest in all current and future
Leases and Rents and all proceeds from the sale, cancellation, surrender or
other disposition of the Leases, it being intended by Mortgagor that this
assignment constitutes a present, absolute assignment and not an assignment for
additional security only. Such assignment to Mortgagee shall not be construed to
bind Mortgagee to the performance of any of the covenants, conditions or
provisions contained in any such Lease or otherwise to impose any obligation
upon Mortgagee. Mortgagor agrees to execute and deliver to Mortgagee such
additional instruments in form and substance satisfactory to Mortgagee, as may
hereafter be requested by Mortgagee to further evidence and confirm such
assignment. Nevertheless, subject to the terms of this PARAGRAPH 7, Mortgagee
grants to Mortgagor a revocable license to operate and manage the Mortgaged
Property and to collect the Rents. Mortgagor shall hold the Rents, or a portion
thereof sufficient to discharge all current sums due on the Indebtedness, in
trust for the benefit of Mortgagee for use in the payment of such sums. The
grant of the foregoing license is subject to the provisions of PARAGRAPH 1 of
the separate Assignment of Leases and Rents of even date herewith granted by the
Mortgagor as "Assignor" to the Mortgagee as "Assignee" with respect to the
Mortgaged Property ("ASSIGNMENT OF LEASES AND RENTS"). Upon the occurrence of an
Event of Default, the license granted to Mortgagor herein shall be automatically
revoked and Mortgagee shall immediately be entitled to possession of all Rents,
whether or not Mortgagee enters upon or takes control of the Mortgaged Property.
Mortgagee is hereby granted and assigned by Mortgagor the right, at its option,
upon the revocation of the license granted herein to enter upon the Mortgaged
Property in person, by agent or by court-appointed receiver to collect the
Rents. Any Rents collected after the revocation of the license herein granted
may be applied toward payment of the Indebtedness in such priority and
proportion as Mortgagee in its discretion shall deem proper. It is further the
intent of Mortgagor and Mortgagee that the Rents hereby absolutely assigned are
no longer, during the term of this Mortgage, property of Mortgagor or property
of any estimate of Mortgagor as defined in Section 541 of the Bankruptcy Code
and shall not constitute collateral, cash or otherwise, of Mortgagor. The term
"Rents" as used herein shall mean the gross rents without deduction or offsets
of any kind.

               (b)    All Leases executed after the date of this Mortgage shall
provide that they are subordinate to this Mortgage and that the lessee agrees to
attorn to Mortgagee;

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                                                                Loan No. 6518217

PROVIDED, HOWEVER, that nothing herein shall affect Mortgagee's right to
designate from time to time any one or more Leases as being superior to this
Mortgage and Mortgagor shall execute and deliver to Mortgagee and shall cause to
be executed and delivered to Mortgagee from each tenant under such Lease any
instrument or agreement as Mortgagee may deem necessary to make such Lease
superior to this Mortgage. Upon request, Mortgagor shall promptly furnish
Mortgagee with executed copies of all Leases.

               (c)    Mortgagor shall not, without the prior consent of
Mortgagee, (i) lease all or any part of the Mortgaged Property, (ii) alter or
change the terms of any Lease or cancel or terminate, abridge or otherwise
modify the terms of any Lease, (iii) consent to any assignment of or subletting
under any Lease not in accordance with its terms, (iv) cancel, terminate,
abridge or otherwise modify any guaranty of any Lease or the terms thereof, (v)
collect or accept prepayments of installments of Rents for a period of more than
one(1) month in advance or (vi) further assign the whole or any part of the
Leases or the Rents; PROVIDED, HOWEVER, that such action as described in
subsections (i)-(iv) above may be taken without Mortgagee's consent for any
Lease which is for 10,000 square feet of space or less, and has a term
(including the renewal or extension term) of five (5) years or less, and so long
as such Lease provides for an annual rent at least equal to the then competitive
and comparable market rent (a lease satisfying those criteria shall be referred
to as a "SMALL LEASE") so long as the taking of such action is in the ordinary
course of Mortgagor's business and that such action is still subject to
PARAGRAPH 1 of the separate Assignment of Leases and Rents pertaining to
Termination Amounts (as defined therein).

               (d)    With respect to each Lease, Mortgagor shall (i) observe
and perform each and every provision thereof on the lessor's part to be
fulfilled or performed under each Lease and not do or permit to be done anything
to impair the value of the Lease as security for the Loan, including surrender
or voluntary termination of any Lease, (ii) promptly send to Mortgagee copies of
all notices of default which Mortgagor shall send or receive thereunder, (iii)
enforce all of the terms, covenants and conditions contained in such Lease upon
the lessee's part to be performed, short of termination thereof, (iv) execute
and deliver, at the request of Mortgagee, all such further assurances,
confirmations and assignments in connection with the Mortgaged Property as
Mortgagee shall, from time to time, require and (v) upon request, furnish
Mortgagee with executed copies of all Leases; PROVIDED, HOWEVER, the notice to
Mortgagee referenced in subsection (ii) above and the restriction on termination
of a Lease in connection with the enforcement of its terms, covenants and
conditions set forth in (iii) above shall not be required or apply, as the case
may be, for any Small Lease. Upon the occurrence of any Event of Default under
this Mortgage, Mortgagor shall pay monthly in advance to Mortgagee, or any
receiver appointed to collect the Rents, the fair and reasonable rental value
for the use and occupation of the Mortgaged Property or part of the Mortgaged
Property as may be occupied by Mortgagor or any one Mortgagor and upon default
in any such payment Mortgagor shall vacate and surrender possession of the
Mortgaged Property to Mortgagee or to such receiver and, in default thereof,
Mortgagor may be evicted by summary proceedings or otherwise.

               (e)    All security deposits of tenants, whether held in cash or
any other form, shall not be commingled with any other funds of Mortgagor and,
if cash, shall be deposited by Mortgagor at such commercial or savings bank or
banks as may be reasonably satisfactory to Mortgagee. Any bond or other
instrument which Mortgagor is permitted to hold in lieu of cash

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                                                                Loan No. 6518217

security deposits under any applicable legal requirements shall be maintained in
full force and effect in the full amount of such deposits unless replaced by
cash deposits as hereinabove described, shall be issued by an institution
reasonably satisfactory to Mortgagee, shall, if permitted pursuant to any legal
requirements, name Mortgagee as payee or mortgagee thereunder (or at Mortgagee's
option, be fully assignable to Mortgagee) and shall, in all respects, comply
with any applicable legal requirements and otherwise be reasonably satisfactory
to Mortgagee. Mortgagor shall, upon request, provide Mortgagee with evidence
reasonably satisfactory to Mortgagee of Mortgagor's compliance with the
foregoing. Following the occurrence and during the continuance of any Event of
Default, Mortgagor shall, upon Mortgagee's request, if permitted by any
applicable legal requirements, turn over to Mortgagee the security deposits (and
any interest theretofore earned thereon) with respect to all or any portion of
the Mortgaged Property, to be held by Mortgagee subject to the terms of the
Leases.

          8.   MAINTENANCE AND USE OF MORTGAGED PROPERTY. Mortgagor shall or
shall cause tenants to, at its sole cost and expense, keep and maintain the
Mortgaged Property, including, without limitation, parking lots and recreational
and landscaped portions thereof, if any, in good order and condition. The
Improvements and the Equipment shall not be diminished, removed, demolished or
materially altered (except for normal replacement of Equipment) and Mortgagor
shall not erect any new buildings, structures or building additions on the
Mortgaged Property without the prior consent of Mortgagee. So long as no Event
of Default shall have occurred and be continuing, Mortgagor shall have the right
at any time and from time to time after providing Mortgagee with written notice
to make or cause to be made reasonable alterations of and additions to the
Mortgaged Property or any part thereof, PROVIDED that any alteration or addition
(i) shall not change the general character of the Mortgaged Property or reduce
the fair market value thereof below its value immediately before such alteration
or addition, or impair the usefulness of the Mortgaged Property, (ii) is
effected with due diligence, in a good and workmanlike manner and in compliance
with all applicable laws and with all provisions of any insurance policy
covering or applicable to the Mortgaged Property and all requirements of the
issuers thereof, (iii) is promptly and fully paid for, or caused to be paid for,
by Mortgagor, (iv) the estimated cost of such alteration or addition does not
exceed five percent (5%) of the original principal amount of the Loan, (v) is
made under the supervision of a qualified architect or engineer, (vi) shall not
violate the terms of any Leases, and (vii) upon completion, Mortgagor shall
provide Mortgagee with (aa) a satisfactory final improvement survey if the
footprint of the building has been altered, (bb), any final occupancy permit
which may be required for the Improvements, (cc) all other governmental permits,
certificates and approvals and all other permits, certificates and approvals of
fire underwriters which are required with respect to the alterations and
additions and the use and occupancy thereof, and shall furnish true copies
thereof to Mortgagee, and (dd) final lien waivers from all contractors,
subcontractors and materialmen. Mortgagor shall promptly comply with all laws,
orders and ordinances affecting the Mortgaged Property, or the use thereof,
PROVIDED, HOWEVER, that nothing in the foregoing clause shall require Mortgagor
to comply with any such law, order or ordinance so long as Mortgagor shall in
good faith, after notice to, but without cost or expense to, Mortgagee, contest
the validity of such law, order or ordinance by appropriate legal proceedings
and in accordance with all applicable law, which proceedings must operate to
prevent (i) the enforcement thereof, (ii) the payment of any fine, charge or
penalty, (iii) the sale or forfeiture of the Mortgaged Property or any part
thereof, (iv) the lien of this Mortgage and the priority thereof from being
impaired, (v) the imposition of criminal liability on Mortgagee and (vi) the
imposition, unless stayed, of civil liability on

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                                                                Loan No. 6518217

Mortgagee; PROVIDED that during such contest Mortgagor shall, at the option of
Mortgagee, provide cash, bonds or other security satisfactory to Mortgagee,
indemnifying and protecting Mortgagee against any liability, loss or injury by
reason of such non-compliance or contest, and PROVIDED FURTHER, that such
contest shall be promptly and diligently prosecuted by and at the expense of
Mortgagor. Mortgagor shall promptly, at its sole cost and expense, repair,
replace or rebuild any part of the Mortgaged Property which may be destroyed by
any casualty, or become damaged, worn or dilapidated. Mortgagor shall not commit
any waste at the Mortgaged Property. Mortgagor shall not initiate, join in,
acquiesce in or consent to any material adverse change in any private
restrictive covenant, zoning law or other public or private restriction,
limiting or defining the uses which may be made of the Mortgaged Property or any
part thereof. If under applicable zoning provisions the use of all or any
portion of the Mortgaged Property is or shall become a nonconforming use,
Mortgagor will not cause or permit such nonconforming use to be discontinued or
abandoned without the express consent of Mortgagee. Mortgagor covenants and
agrees that it shall operate the Mortgaged Property at all times as a
first-class commercial retail facility.

          9.   TRANSFER OR ENCUMBRANCE OF THE MORTGAGED PROPERTY OR INTERESTS
IN THE MORTGAGOR; OTHER INDEBTEDNESS.

               (a)    Mortgagor acknowledges that Mortgagee has examined and
relied on the creditworthiness and experience of Mortgagor in owning and
operating properties such as the Mortgaged Property in agreeing to make the
Loan, and that Mortgagee will continue to rely on Mortgagor's ownership of the
Mortgaged Property as a means of maintaining the value of the Mortgaged Property
as security for repayment of the Indebtedness. Mortgagor acknowledges that
Mortgagee has a valid interest in maintaining the value of the Mortgaged
Property so as to ensure that, should Mortgagor default in the repayment of the
Indebtedness, Mortgagee can recover the Indebtedness by a sale of the Mortgaged
Property. Mortgagor shall not, without the prior written consent of Mortgagee,
sell, convey, alienate, mortgage, encumber, pledge or otherwise transfer the
Mortgaged Property or any part thereof or interest therein, or permit the
Mortgaged Property or any part thereof to be sold, conveyed, alienated,
mortgaged, encumbered, pledged or otherwise transferred.

               (b)    A sale, conveyance, alienation, mortgage, encumbrance,
pledge or transfer within the meaning of this PARAGRAPH 9 shall be deemed to
include (i) an installment sales agreement wherein Mortgagor agrees to sell the
Mortgaged Property or any part thereof for a price to be paid in installments,
(ii) an agreement by Mortgagor leasing all or a substantial part of the
Mortgaged Property 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, Mortgagor's right, title and interest in and to any Leases or any Rents,
(iii) if Mortgagor, any guarantor of Non-Recourse Carveout Obligations (as
hereinafter defined), any other guarantor, any indemnitor of environmental
liabilities or any general partner or managing member of Mortgagor or of any
such guarantor or indemnitor is a corporation, the voluntary or involuntary
sale, assignment, 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 series of transactions by which an aggregate of more than ten percent (10%)
of such corporation's stock shall be vested in a party or parties who are not
now stockholders or any change in the control of such corporation, (iv) if
Mortgagor, any guarantor,

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                                                                Loan No. 6518217

of Non-Recourse Carveout Obligations, any other guarantor or any indemnitor of
environmental liabilities or any general partner or managing member of Mortgagor
or any such guarantor or indemnitor 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, and (v) if Mortgagor, any guarantor of Non-Recourse Carveout
Obligations or any other guarantor or any indemnitor of environmental
liabilities, is an entity, whether one of the above-mentioned entities or not,
any change in the ownership or control of such entity, any merger, consolidation
or dissolution or syndication affecting such entity, or the transfer, sale,
assignment or pledge of any interest in such entity or in any person, directly
or indirectly, controlling such entity or in any general partner or managing
member thereof, whether at one time or in a series of related transactions.

               (c)    Mortgagee shall not be required to demonstrate any actual
impairment of its security or any increased risk of default hereunder in order
to declare the Indebtedness immediately due and payable upon Mortgagor's sale,
conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Mortgaged Property without Mortgagee's consent. This provision shall apply to
every sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of
the Mortgaged Property regardless of whether voluntary or not, or whether or not
Mortgagee has consented to any previous sale, conveyance, alienation, mortgage,
encumbrance, pledge or transfer of the Mortgaged Property.

               (d)    Mortgagee's consent to a sale, conveyance, alienation,
mortgage, encumbrance, pledge or transfer of the Mortgaged Property or any other
action described in this PARAGRAPH 9 shall not be deemed to be a waiver of
Mortgagee's right to require such consent to any future occurrence of same. Any
sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Mortgaged Property or other action made in contravention of this PARAGRAPH 9
shall be null and void and of no force and effect.

               (e)    Mortgagor agrees to bear and shall pay or reimburse
Mortgagee on demand for all reasonable expenses (including, without limitation,
reasonable attorneys' fees and disbursements, title search costs and title
insurance endorsement premiums) incurred by Mortgagee in connection with the
review, approval and documentation of any such sale, conveyance, alienation,
mortgage, encumbrance, pledge or transfer.

               (f)    Notwithstanding the foregoing, Mortgagee shall permit
two(2) sales or transfers of the Mortgaged Property, PROVIDED that:

               (i)    no Event of Default or event which with the giving of
     notice or passage of time would constitute an Event of Default shall have
     occurred and remain uncured;

               (ii)   the proposed transferee ("TRANSFEREE"), the guarantors of
     Non-Recourse Carveout Obligations, any other guarantor, and the indemnitors
     of environmental liabilities shall be reputable entities or persons of good
     character, creditworthy, with sufficient financial worth considering the
     obligations assumed and

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                                                                Loan No. 6518217

     undertaken, as evidenced by financial statements and other information
     reasonably requested by Mortgagee

               (iii)  the Transferee and its property manager shall have
     sufficient experience in the ownership and management of properties similar
     to the Mortgaged Property, and Mortgagee shall be provided with reasonable
     evidence thereof (and Mortgagee reserves the right to approve the
     Transferee without approving the substitution of the property manager);

               (iv)   that Mortgagee has received a written request for approval
     from the Mortgagor at least thirty (30) days prior to the proposed transfer
     (including a description of the proposed terms of the transfer), together
     with a diagram showing the legal structure of the Transferee, the proposed
     guarantors of Non-Recourse Carveout Obligations, any other proposed
     guarantors, and the proposed indemnitors of environmental liabilities and
     all of the constituent entities of each, after the contemplated transfer,
     and a list of the names, types of interests and ownership percentages of
     all persons to have ownership interests in any of the foregoing or any
     constituent entity thereof, financial statements for all such entities and
     an administrative fee of $5,000, which shall be deemed fully earned on the
     date of receipt and shall be retained by Mortgagee regardless of whether or
     not the transfer occurs and whether or not approval is given;

               (v)    Mortgagee and its counsel have received (aa) certification
     from Mortgagor and the Transferee that the proposed terms of the transfer
     described in subparagraph 9(f)(iv) are the actual terms of the transfer,
     (bb) evidence of casualty insurance and other applicable insurance, (cc)
     all corporate, partnership or other entity documents and (dd) all other
     certificates, legal opinions, title materials and other documents which
     Mortgagee may require, all in form and substance satisfactory to Mortgagee,
     at least thirty (30) days prior to the proposed transfer;

               (vi)   Mortgagee be provided satisfactory evidence concerning the
     effect of any change in the real estate taxes to result from the sale and
     the effect of such change on the ability of the Mortgaged Property to
     generate a cash flow sufficient to pay the debt service on the Loan and to
     maintain a debt service coverage ratio satisfactory to Mortgagee;

               (vii)  If the Loan is part of a Secondary Market Transaction and
     the documents governing such Secondary Market Transaction so require,
     Mortgagee shall have received in writing evidence from the Rating Agencies
     to the effect that such transfer will not result in a re-qualification,
     reduction or withdrawal of any rating initially assigned or to be assigned
     in a Secondary Market Transaction together with such legal opinions as may
     be requested by the Rating Agencies. The term "RATING AGENCIES" as used
     herein shall mean each of Standard & Poor's Ratings Group, Moody's
     Investors Service, Inc., Duff & Phelps Credit Rating Co., Fitch Investors
     Service, Inc. or any other nationally-recognized statistical rating agency
     who shall then be rating the certificates or securities issued in
     connection with the Secondary Market Transaction;

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                                                                Loan No. 6518217

               (viii) the Transferee and its constituent entities shall comply
     with all of the Single Purpose Entity/Separateness requirements set forth
     in Paragraph 19 hereof;

               (ix)   the Transferee shall have executed and delivered to
     Mortgagee an assumption agreement in form and substance acceptable to
     Mortgagee, evidencing such Transferee's agreement to abide and be bound by
     the terms of the Note, this Mortgage and the other Loan Documents, together
     with an executed guaranty of Non-Recourse Carveout Obligations and any
     other guaranty from an approved guarantor and an executed separate
     environmental indemnity agreement from an approved indemnitor, both in form
     and substance acceptable to Mortgagee, other documentation as Mortgagee may
     reasonably require, and such legal opinions and title insurance
     endorsements as may be reasonably requested by Mortgagee;

               (x)    Mortgagee shall have received an assumption fee equal to
     one percent (1%) of the then unpaid principal balance of the Note (against
     which the administrative fee shall be credited) in addition to the payment
     of all reasonable costs and expenses incurred by Mortgagee in connection
     with such assumption (including reasonable attorney's fees and costs); and

               (xi)   the Transferee shall be able to make the representations
     and warranties set forth in Paragraph 18(h) of this Mortgage.

          In the event all of the foregoing conditions are satisfied and
Mortgagee consents to the sale or transfer, Mortgagee agrees to release
Mortgagor, any indemnitors under any environmental indemnity and any guarantors
of the Non-Recourse Carveout Obligations of all liability under the Loan
Documents upon such transfer of the Morgaged Property pursuant to this Paragraph
9(f), (1) except for any event or circumstance with respect to which Mortgagor
and such indemnitors remain obligated to continue to indemnify Mortgagee under
any environmental indemnity agreement; (2) except for any fraud or willful
misrepresentation by or on behalf of Mortgagor, or such indemnitor or guarantor
with respect to the Mortgaged Property or the making or delivery of any of the
Loan Documents or with respect to any materials or information provided by or on
behalf of Mortgagor, indemnitor or guarantor in connection with the Loan, and
(3) provided that Mortgagor's obligations arising prior to completion of such
transfer are no longer subject to disgorgement under any applicable state or
federal creditor rights or bankruptcy laws and Mortgagee receives an assumption
of the obligations of such indemnitor and guarantor by an individual(s) or
entity(ies) acceptable to Mortgagee in its sole discretion.

          Mortgagor and Mortgagee further agree that (1) any environmental
indemnification obligations of Mortgagor or any indemnitor under an
environmental indemnity agreement shall not apply to any future environmental
activity or conditions resulting solely from any act or omission for which
Mortgagor bears no responsibility and which occurs after Mortgagor or any person
or entity in any way related to Mortgagor no longer holds possession or has any
interest in the Mortgaged Property; provided, however, the transferor Mortgagor,
the prior guarantors and the prior indemnitors, respectively, shall have the
burden of establishing that all the conditions in this PARAGRAPH 9 (including,
without limitation, the time as to which matters described herein arose) were
satisfied by clear and convincing evidence and shall indemnify and hold
Mortgagee harmless for all matters set forth in PARAGRAPH 39 and in the Non-

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                                                                Loan No. 6518217

Recourse Carveout Obligations until such transferor Mortgagor, prior guarantors
or prior indemnitors, respectively, have met such burden; Mortgagee agrees that
Mortgagor shall have met such burden with respect to the Mortgaged Property if
Mortgagor at such time delivers to Mortgagee a clean Phase I environmental
assessment report satisfactory in all respects to Mortgagee if prior to delivery
thereof there has not occurred any release of Hazardous Materials at the
Mortgaged Property nor has there been any prior violation of Environmental Laws
at the Mortgaged Property (and if there has been a release of Hazardous
Materials or a violation of Environmental Laws, in such instance in lieu of
delivery of such Phase I environmental assessment Mortgagor shall deliver to
Mortgagee an environmental insurance policy satisfactory in all respects to
Mortgagee in its reasonable discretion); and (2) in the event the individual or
entity(ies) assuming the obligations of such indemnitor and guarantor are
acceptable to Mortgagee in its sole discretion, are willing to accept such
indemnitor's obligation under the environmental indemnity for the time period in
which the original indemnitor guaranteed the obligations of Mortgagor (i.e. the
time period prior to said transfer of the Mortgaged Property) and are willing to
execute an indemnity in form and content acceptable to Mortgagee, then,
notwithstanding the foregoing, such original indemnitor will be completely
relieved of liability under such original indemnitor will be completely relieved
of liability under such environmental indemnity (except for any fraud or willful
misrepresentation by or on behalf of Mortgagor or such environmental indemnitor
or guarantor with respect to the Mortgaged Property, the making or delivery of
any of the Loan Documents or in any materials or information provided by or on
behalf of such indemnitor in connection with the Loan).

               (g)    The provisions of Paragraphs 9(a), 9(b) and 9(f) shall not
operate to prohibit the transfer, sale or conveyance of shares in Inland Retail
Real Estate Trust, Inc. (the "Trust") or any limited partnership interests in
Inland Retail Real Estate Limited Partnership (the "Partnership") as long as all
of the following conditions are satisfied:

                      (i)    the Partnership continues to be the sole member and
     owner of Mortgagor and continues to control the day-to-day operations of
     Mortgagor and the Mortgaged Property;

                      (ii)   the Trust remains the general partner of the
     Partnership and continues to control the Partnership and the day-to-day
     operations of Mortgagor and the Mortgaged Property;

                      (iii)  the Trust maintains its status as a real estate
     investment trust; and

                      (iv)   no such transfer results in any party owning more
     than twenty percent (20%) (or such lesser amount as constitutes a
     controlling interest) in the shares or ownership units or interests of the
     Trust or the Partnership.

               The term CONTROL or CONTROLLING shall mean the possession,
     directly or indirectly, of the power to direct or cause the direction of
     management, policies or activities of a person or entity, whether through
     ownership of voting securities or other interests, by contract or
     otherwise.

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                                                                Loan No. 6518217

               (h)    Notwithstanding anything in this Paragraph 9 to the
contrary, Mortgagor shall have a one time right, provided no Event of Default or
event which with the giving of notice or passage of time would constitute an
Event of Default under the Loan Documents shall have occurred and remain
uncured, to assign, sell or transfer (the "Permitted Affiliated Transfer") all
of the Mortgaged Property to an affiliate of Inland Retail Real Estate Limited
Partnership or to an affiliate of Inland Retail Real Estate Trust, Inc.
("Permitted Affiliated Transferee"), PROVIDED that:

                      (i)    Mortgagor shall pay to Mortgagee a $5,000.00
     transfer fee;

                      (ii)   Mortgagee shall have received from Mortgagor
     reimbursement of all of Mortgagee's expenses, including legal fees,
     incurred in connection with the Permitted Affiliated Transfer;

                      (iii)  the Permitted Affiliated Transferee shall assume,
     in form and substance satisfactory to Mortgagee, all obligations of
     Mortgagor under the Loan Documents, including, without limitation, the
     environmental Indemnity Agreement and Guaranty of non-recourse carveout
     obligations, with the same degree of recourse liability as Mortgagor and
     subject to the same exculpatory provisions;

                      (iv)   Mortgagee shall have received a title policy
     satisfactory to Mortgagee updated to the date of the Permitted Affiliated
     Transfer, evidencing that such Permitted Affiliated Transfer will not
     adversely affect Mortgagee's first and prior lien on the Mortgaged Property
     or any other rights or interests granted to Mortgagee under the Loan
     Documents;

                      (v)    Mortgagee shall have received legal opinions of
     Mortgagor's independent or in-house counsel, as the case may be, in form
     and substance satisfactory to Mortgagee, that all previous opinions
     pertaining to Mortgagor are true with respect to the Permitted Affiliated
     Transferee and the Permitted Affiliated Transferee has duly assumed the
     Loan Documents, and the same are valid and enforceable against the
     Permitted Affiliated Transferee and the Mortgaged Property and that
     Mortgagor has the requisite power and authority to properly transfer the
     Mortgaged Property;

                      (vi)   no Event of Default shall have occurred and remain
     uncured under the Loan Documents;

                      (vii)  no such transfer of interest shall result in a
     change of control of Mortgagor or the day-to-day operations of the
     Mortgaged Property;

                      (viii) without limiting the foregoing, no such transfer,
     either singly or in the aggregate with other transfers, will result in a
     violation of the special purpose entity provisions of the Loan Documents or
     Mortgagor's organizational documents and Mortgagor will provide new or
     updated non-consolidation opinions and other opinions to the extent
     required at the initial funding of the Loan with respect to the Permitted
     Affiliated Transfer; and

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                                                                Loan No. 6518217

                      (ix)   Mortgagee has received at least thirty (30) days'
     prior written notice of such transfer, together with a diagram showing the
     structure of the Mortgagor and all constituent entities after the
     contemplated transfer and a list of the names, types of interests and
     percentages of ownership of all owners of interests in Mortgagor and any
     constituent entities (except the shareholders of Inland Retail Real Estate
     Trust, Inc.) after the contemplated transfer.

                      (i)    Mortgagor has not incurred and will not incur any
indebtedness, secured or unsecured, other than the Loan and debt (i) incurred in
the ordinary course of business to vendors and suppliers of services to the
Mortgaged Property, (ii) not secured by the Mortgaged Property, or any portion
thereof, or by interests in the Mortgagor or any constituent entity thereof, and
(iii) not accompanied by any rights to control or to obtain control of the
Mortgagor or any constituent entity thereof. No indebtedness other than the Loan
may be secured (subordinate or PARI PASSU) by the Mortgaged Property, or any
portion thereof, or by interests in the Mortgagor or any constituent entity
thereof.

               10.    ESTOPPEL CERTIFICATES.

                      (a)    Mortgagor, within ten (10) business days after
request by Mortgagee, shall furnish Mortgagee from time to time with a
statement, duly acknowledged and certified, setting forth (i) the amount of the
original principal amount of the Note, (ii) the unpaid principal amount of the
Note, (iii) the rate of interest in the Note, (iv) the date through which all
installments of interest, commitment fees and/or principal have been paid, (v)
any offsets or defenses to the payment of the Indebtedness, if any, (vi) that
the Note and this Mortgage have not been modified or if modified, giving
particulars of such modification and (vii) such other information as shall be
requested by Mortgagee.

                      (b)    Mortgagor, after request by Mortgagee, will use
commercially reasonable efforts to obtain and furnish (within the time periods,
if any, provided in the applicable Leases or if no time period is so specified,
within ten (10) business days after request) Mortgagee from time to time with
estoppel certificates from any tenants under then existing Leases, which
certificates shall be in form and substance as required by such Leases, or if
not required, then in form and substance reasonably satisfactory to Mortgagee.

               11.    NO COOPERATIVE OR CONDOMINIUM. Mortgagor represents and
warrants that the Mortgaged Property has not been subjected to a cooperative or
condominium form of ownership. Mortgagor hereby covenants and agrees that it
will not file a declaration of condominium, map or any other document having the
effect of subjecting the Mortgaged Property, to a condominium or cooperative
form of ownership.

               12.    CHANGES IN THE LAWS REGARDING TAXATION. If any law is
enacted or adopted or amended after the date of this Mortgage which deducts the
Indebtedness or any portion thereof from the value of the Mortgaged Property for
the purpose of taxation or which imposes a tax, either directly or indirectly,
on the principal amount of the Note or Mortgagee's interest in the Mortgaged
Property, Mortgagor will pay such tax, with interest and penalties thereon, if
any. In the event Mortgagee is advised by counsel chosen by it that the payment
of such tax or interest and penalties by Mortgagor would be unlawful or taxable
to Mortgagee or

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                                                                Loan No. 6518217

unenforceable or provide the basis for a defense of usury, then in any such
event, Mortgagee shall have the option, by notice of not less than sixty (60)
days, to declare the Indebtedness immediately due and payable without prepayment
fee or premium, except that if an Event of Default, or an event which with
notice and/or the passage of time, or both, would constitute an Event of
Default, has occurred, the applicable premium computed in accordance with the
Note shall apply.

               13.    NO CREDITS ON ACCOUNT OF THE INDEBTEDNESS. Mortgagor will
not claim or demand or be entitled to any credit or credits on account of the
Indebtedness for any part of the Taxes assessed against the Mortgaged Property
or any part thereof and no deduction shall otherwise be made or claimed from the
taxable value of the Mortgaged Property, or any part thereof, by reason of this
Mortgage or the Indebtedness. In the event such claim, credit or deduction shall
be required by law, Mortgagee shall have the option, by notice of not less than
sixty (60) days, to declare the Indebtedness immediately due and payable without
prepayment fee or premium, except that if an Event of Default, or an event which
with notice and/or the passage of time, or both, would constitute an Event of
Default, has occurred, the applicable premium computed in accordance with the
Note shall apply.

               14.    DOCUMENTARY STAMPS. If at any time the United States of
America, any State thereof or any subdivision of any such State shall require
revenue or other stamps to be affixed to the Note or this Mortgage, or impose
any other tax or charge on the same, Mortgagor will pay for the same, with
interest and penalties thereon, if any.

               15.    RIGHT OF ENTRY. Mortgagee and its agents shall have the
right to enter and inspect the Mortgaged Property at any time during reasonable
business hours upon twenty-four (24) hour notice to Mortgagor, except in the
case of an emergency, in which event Mortgagee and its agents may enter and
inspect the Mortgaged Property at any time.

               16.    BOOKS AND RECORDS.

                      (a)    Mortgagor will maintain full, accurate and complete
books of accounts and other records reflecting the results of the operations of
the Mortgaged Property as well as its other operations and will furnish, or
cause to be furnished, to Mortgagee the following:

                      (i)    within ninety (90) days after the end of each
     fiscal year, the Mortgagor will furnish to Mortgagee, a statement of
     Mortgagor's financial condition, including a balance sheet with respect to
     Mortgagor, and a statement of annual income and expenses satisfactory in
     form and substance to Mortgagee in connection with the operation of the
     Mortgaged Property, in detail satisfactory to Mortgagee, prepared by,
     audited and certified by a certified public accountant who is a member of
     the American Institute of Certified Public Accountants, provided however
     that so long as there in then no Event of Default hereunder, such statement
     may be prepared and certified by Mortgagor, Mortgagor's accountant or a
     financial officer of Mortgagor if such certified statement by a certified
     public accountant is not available, and, in addition, within forty-five
     (45) days after the end of each fiscal quarter of Mortgagor, Mortgagor
     shall provide

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                                                                Loan No. 6518217

     the above information except that it may be prepared and certified by the
     financial officer of Mortgagor who is responsible for the preparation of
     such annual financial statements.

                      (ii)   accompanying the submission of the certified
     statements of annual and quarterly income and expenses, when the Mortgaged
     Property is office, retail or multi-tenant industrial property, shall be a
     certified current rent roll in a form previously approved by Mortgagee,
     which shall include, among other things, tenant names, lease commencement
     and expiration dates, square footage and annual rent.

                      (b)    Mortgagee shall have the right, upon five (5) days'
prior notice to Mortgagor, to inspect and make copies of Mortgagor's books and
records and income tax returns and notices.

                      (c)    In the event of a Secondary Market Transaction,
Mortgagor shall furnish from time to time such information relating to Mortgagor
and the Mortgaged Property as shall be reasonably requested by the Rating
Agencies at no cost to Mortgagor.

               17.    PERFORMANCE OF OTHER AGREEMENTS. Mortgagor shall observe
and perform each and every term to be observed or performed by such Mortgagor
pursuant to the terms of any agreement or recorded instrument affecting or
pertaining to the Mortgaged Property.

               18.    REPRESENTATIONS AND COVENANTS CONCERNING LOAN. Mortgagor
represents, warrants and covenants as follows:

                      (a)    The Note, this Mortgage and the other Loan
Documents are not subject to any right of rescission, set-off, counterclaim or
defense, including the defense of usury, nor would the operation of any of the
terms of the Note, this Mortgage and the other Loan Documents, or the exercise
of any right thereunder, render this Mortgage unenforceable, in whole or in
part, or subject to any right of rescission, set-off, counterclaim or defense,
including the defense of usury.

                      (b)    To Mortgagor's best knowledge, all certifications,
permits, licenses and approvals, including, without limitation, certificates of
completion and occupancy permits required for the legal use, occupancy of the
Mortgaged Property, have been obtained and are in full force and effect. The
Mortgaged Property is free of material damage and is in good repair, and there
is no proceeding pending for the total or partial condemnation of, or affecting,
the Mortgaged Property.

                      (c)    To Mortgagor's best knowledge, all of the
Improvements which were included in determining the appraised value of the
Mortgaged Property lie wholly within the boundaries and building restriction
lines of the Mortgaged Property, and no improvements on adjoining properties
encroach upon the Mortgaged Property, and no easements or other encumbrances
upon the Land encroach upon any of the Improvements, so as to affect the value
or marketability of the Mortgaged Property except those which are insured
against by title insurance. All of the Improvements comply with all requirements
of applicable zoning and subdivision laws and ordinances in all material
respects.

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                                                                Loan No. 6518217

                      (d)    The Mortgaged Property is not subject to any Leases
other than the Leases described in the rent roll delivered to Mortgagee in
connection with this Mortgage. No person has any possessory interest in the
Mortgaged Property or right to occupy the same except under and pursuant to the
provisions of the Leases. Except as otherwise disclosed in writing to Mortgagee,
to Mortgagor's best knowledge the current Leases are in full force and effect
and there are no defaults thereunder by either party and there are no conditions
that, with the passage of time or the giving of notice, or both, would
constitute defaults thereunder. Except as otherwise disclosed in writing to
Mortgagee, all presently existing Leases are subordinate to this Mortgage.

                      (e)    To Mortgagor's best knowledge, the Mortgaged
Property and the Leases are in compliance with all statutes, ordinances,
regulations and other governmental or quasi-governmental requirements and
private covenants now or hereafter relating to the ownership, construction, use
or operation of the Mortgaged Property.

                      (f)    To Mortgagor's best knowledge there has not been
and shall never be committed by Mortgagor any act or omission affording the
federal government or any state or local government the right of forfeiture as
against the Mortgaged Property or any part thereof or any monies paid in
performance of Mortgagor's obligations under any of the Loan Documents.
Mortgagor hereby covenants and agrees not to commit, permit or suffer to exist
any act or omission affording such right of forfeiture.

                      (g)    The Management Agreement (the "MANAGEMENT
AGREEMENT") between Mortgagor and Inland Mid-Atlantic Management Corp.
("MANAGER") pursuant to which Manager operates the Mortgaged Property (a true,
correct and complete copy of which has been delivered to Mortgagee) is in full
force and effect and there is no default or violation by any party thereunder.
The fee due under the Management Agreement, and the terms and provisions of the
Management Agreement, are subordinate to this Mortgage and the Manager shall
attorn to Mortgagee. Mortgagor shall not terminate, cancel, modify, renew or
extend the Management Agreement, or enter into any agreement relating to the
management or operation of the Mortgaged Property with Manager or any other
party without the express written consents of Mortgagee, which consent shall not
be unreasonably withheld. If at any time Mortgagee consents to the appointment
of a new manager, such new manager and Mortgagor shall, as a condition of
Mortgagee's consent, execute a Manager's Consent and Subordination of Management
Agreement in the form then used by Mortgagee.

                      (h)    IMPROPER FINANCIAL TRANSACTIONS.

                      (i)    Mortgagor is, and shall remain at all times, in
     full compliance with all applicable laws and regulations of the United
     States of America that prohibit, regulate or restrict financial
     transactions, and any amendments or successors thereto and any applicable
     regulations promulgated thereunder (collectively, the "FINANCIAL CONTROL
     LAWS"), including but not limited to those related to money laundering
     offenses and related compliance and reporting requirements (including any
     money laundering offenses prohibited under the Money Laundering Control
     Act, 18 U.S.C. Sections 1956, 1957 and

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                                                                Loan No. 6518217

     the Bank Secrecy Act, 31 U.S.C. Sections 5311 ET SEQ.) and the Foreign
     Assets Control Regulations, 31 C.F.R. Section 500 ET SEQ.

                      (ii)   Mortgagor represents and warrants that: (i)
     Mortgagor is not a Barred Person (hereinafter defined); (ii) Mortgagor is
     not owned or controlled, directly or indirectly, by any Barred Person; and
     (iii) Mortgagor is not acting, directly or indirectly, for or on behalf of
     any Barred Person.

                      (iii)  Mortgagor represents and warrants that it
     understands and has been advised by legal counsel on the requirements of
     the Financial Control Laws.

                      (iv)   Under any provision of this Mortgage or any of the
     other Loan Documents where the Mortgagee shall have the right to approve or
     consent to any particular action, including without limitation any (i)
     sale, transfer, assignment of the Mortgaged Property or of any direct or
     indirect ownership interest in Mortgagor, (ii) leasing of the Mortgaged
     Property, or any portion thereof, or (iii) incurring of additional
     financing secured by Mortgaged Property, or any portion thereof or by any
     direct of indirect ownership interest in the Mortgagor, Mortgagee shall
     have the right to withhold such approval or consent, in its sole
     discretion, if the granting of such approval or consent could be construed
     as a violation of any of the Financial Control Laws.

                      (v)    Mortgagor covenants and agrees that it will upon
     request provide Mortgagee with (or cooperate with Mortgagee in obtaining)
     information required by Mortgagee for purposes of complying with any
     Financial Control Laws.

                      As used in this Mortgage, the term "BARRED PERSON" shall
mean (i) any person, group or entity named as a "Specially Designated National
and Blocked Person" or as a person who commits, threatens to commit, supports,
or is associated with terrorism as designated by the United States Department of
the Treasury's Office of Foreign Assets Control ("OFAC"), (ii) any person, group
or entity named in the lists maintained by the United Stated Department of
Commerce (Denied Persons and Entities), (iii) any government or citizen of any
country that is subject to a United States Embargo identified in regulations
promulgated by OFAC and (iv) any person, group or entity named as a denied or
blocked person or terrorist in any other list maintained by any agency of the
United States government.

                      19.    SINGLE PURPOSE ENTITY/SEPARATENESS. Mortgagor
represents, warrants and covenants as follows:

                      (a)    The purpose for which the Mortgagor is organized
shall be limited solely to (A) owning, holding, selling, leasing, transferring,
exchanging, operating and managing the Mortgaged Property, (B) entering into the
Loan with the Mortgagee, (C) refinancing the Mortgaged Property in connection
with a permitted repayment of the Loan, and (D) transacting any and all lawful
business for which a Mortgagor may be organized under its constitutive law that
is incident, necessary and appropriate to accomplish the foregoing.

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                                                                Loan No. 6518217

                      (b)    Mortgagor does not own and will not own any asset
or property other than (i) the Mortgaged Property, and (ii) incidental personal
property necessary for and used in connection with the ownership or operation of
the Mortgaged Property.

                      (c)    Mortgagor will not engage in any business other
than the ownership, management and operation of the Mortgaged Property.

                      (d)    Mortgagor will not enter into any contract or
agreement with any affiliate of Mortgagor, any constituent party of Mortgagor,
any owner of the Mortgagor, the Guarantors (as hereinafter defined) or any
affiliate of any constituent party or Guarantor, except upon terms and
conditions that are intrinsically fair, commercially reasonable and
substantially similar to those that would be available on an arms-length basis
with third parties not affiliated with the Mortgagor or any constituent party of
Mortgagor or any owner of Mortgagor.

                      (e)    Mortgagor has not incurred and will not incur any
indebtedness, secured or unsecured, other than the Loan and debt (i) incurred in
the ordinary course of business to vendors and suppliers of services to the
Mortgaged Property, (ii) not secured by the Mortgaged Property, or any portion
thereof, or by interests in the Mortgagor or any constituent entity thereof, and
(iii) not accompanied by any rights to control or to obtain control of the
Mortgagor or any constituent entity thereof. No indebtedness other than the Loan
may be secured (subordinate or PARI PASSU) by the Mortgaged Property, or any
portion thereof, or by interests in the Mortgagor or any constituent entity
thereof.

                      (f)    Mortgagor has not made and will not make any loans
or advances to any entity or person (including any affiliate or any constituent
party of Mortgagor or any owner of Mortgagor, any Guarantor or any affiliate of
any constituent party or Guarantor), and shall not acquire obligations or
securities of its affiliates or any constituent party.

                      (g)    Mortgagor is and will remain solvent and Mortgagor
will pay its debts and liabilities (including, as applicable, shared personnel
and overhead expenses) from its assets as the same shall become due.

                      (h)    Mortgagor has done or caused to be done and will do
all things necessary to observe organizational formalities and preserve its
existence, and Mortgagor will not, nor will Mortgagor permit any constituent
party of Mortgagor or any owner of Mortgagor or any Guarantor to amend, modify
or otherwise change the partnership certificate, partnership agreement, articles
of incorporation and bylaws, operating agreement, trust or other organizational
documents of Mortgagor or such constituent party or Guarantor without the
written consent of Mortgagee.

                      (i)    Mortgagor will maintain all of its books, records
and financial statements separate from those of its affiliates and any
constituent party. Mortgagor's assets will not be listed as assets on the
financial statement of any other entity except the ownership interests in
Mortgagor may be listed as assets on the financial statements of the Trust or
Partnership. Mortgagor shall have its own separate financial statement,
provided, however, that Mortgagor's assets may be included in a consolidated
financial statement of its parent companies if inclusion on such a consolidated
statement is required to comply with the requirements of

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                                                                Loan No. 6518217

generally accepted accounting principles ("GAAP"), provided that such
consolidated financial statement shall contain a footnote to the effect that
Mortgagor's assets are owned by Mortgagor and that they are being included on
the financial statement of its parent solely to comply with the requirements of
GAAP, and further provided that such assets shall be listed on Mortgagor's own
separate balance sheet. Mortgagor will file its own tax returns if required by
law and will not file a consolidated federal income tax return with any other
corporation except the Trust or Partnership in which case Mortgagor will be
shown on a separate schedule of such return as a separate member of the
consolidated group with its delineated financial information. Mortgagor shall
maintain its books, records, resolutions and agreements as official records.

                      (j)    Mortgagor will be, and at all times will hold
itself out to the public as, a legal entity separate and distinct from any other
entity (including any affiliate of Mortgagor, any constituent party of
Mortgagor, any Guarantor or any affiliate of any constituent party or
Guarantor), shall correct any known misunderstanding regarding its status as a
separate entity, shall conduct business in its own name, shall not identify
itself or any of its affiliates as a division or part of the other except the
Trust and Partnership and shall maintain and utilize separate telephone numbers,
stationery, invoices and checks.

                      (k)    Mortgagor will maintain adequate capital for the
normal obligations reasonably foreseeable in a business of its size and
character and in light of its contemplated business operations.

                      (l)    Neither Mortgagor nor any constituent party will
seek the dissolution, winding up, liquidation, consolidation or merger, in whole
or in part, or the sale of material assets of Mortgagor.

                      (m)    Mortgagor will not commingle the funds and other
assets of Mortgagor with those of any affiliate or any constituent party of
Mortgagor or any owner of Mortgagor, any Guarantor, or any affiliate of any
constituent party or Guarantor, or any other person, except for the Manager, and
will not participate in a cash management system with any such party.

                      (n)    Mortgagor will not commingle its assets with those
of any other person or entity except the Manager and will hold all of its assets
in its own name or in its agent's name.

                      (o)    Mortgagor will not guarantee or become obligated
for the debts of any other entity or person and does not and will not hold
itself out as being responsible for the debts or obligations of any other
person.

                      (p)    Mortgagor shall allocate fairly and reasonably any
overhead expenses that are shared with an affiliate, including paying for office
space and services performed by any employee of an affiliate.

                      (q)    The stationery, invoices and checks utilized by
Mortgagor or utilized to collect its funds or pay its expenses shall bear its
own name and shall not bear the name of any other entity unless such entity is
clearly designated as being Mortgagor's agent.

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                                                                Loan No. 6518217

                      (r)    Mortgagor shall not pledge its assets for the
benefit of any other person or entity, and other than with respect to the Loan.

                      (s)    Mortgagor shall correct any known misunderstanding
regarding its separate identity.

                      (t)    Mortgagor shall not identify itself as a division
of any other person or entity except for the Trust or Partnership.

               20.    EVENTS OF DEFAULT: REMEDIES. Each of the following events
after any applicable grace or cure periods shall constitute an "EVENT OF
DEFAULT" hereunder:

                      (a)    if (i) any installment of interest is not paid
within five (5) days after the same is due, (ii) the entire Indebtedness is not
paid on or before the Maturity Date (or if the Maturity Date has been
accelerated, upon such acceleration), or (iii) any other payment or charge due
under the Note, this Mortgage or any other Loan Documents is not paid when due;

                      (b)    if any Taxes payable directly to the billing
authority by Mortgagor are not paid before interest becomes payable on the
amount due or a penalty is assessed (provided that the foregoing provisions of
this clause (b) shall be subject to the right to contest Taxes granted to
Mortgagor in PARAGRAPH 4(b) of this Mortgage, but only for so long as the
conditions in PARAGRAPH 4(b) of this Mortgage remain satisfied);

                      (c)    if the Policies are not kept in full force and
effect and are not delivered to Mortgagee when required hereunder, or if the
Policies are not delivered to Mortgagee within ten (10) days after written
request by Mortgagee;

                      (d)    if any of the provisions of PARAGRAPHS 7, 9, 19 or
39 herein are violated or not complied with;

                      (e)    if any of the events described in PARAGRAPH 41
shall occur;

                      (f)    if at any time any representation or warranty of
Mortgagor or any Guarantor made herein or in any guaranty, agreement,
certificate, report, affidavit, owner's affidavit, financial statement or other
instrument furnished to Mortgagee shall be materially false or misleading in any
respect;

                      (g)    if any mortgagee under a mortgage on the Mortgaged
Property, whether superior or subordinate to this Mortgage (i) demands payment
in full or otherwise accelerates any indebtedness of Mortgagor or (ii) otherwise
commences the exercise of any remedy available to such party under any Loan
Document;

                      (h)    if Mortgagor fails to cure promptly any violation
of any law or ordinance affecting the Mortgaged Property (provided that the
foregoing provisions of this clause (h) shall be subject to any right to contest
such violation specifically granted to Mortgagor in PARAGRAPH 8 of this
Mortgage);

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                                                                Loan No. 6518217

                      (i)    if any Guaranty (as hereinafter defined) is
terminated or any event or condition occurs which, in the sole judgment of
Mortgagee, may impair the ability of any Guarantor to perform its obligations
under any Guaranty or any Guarantor attempts to withdraw, cancel or disclaim any
Guaranty;

                      (j)    if a default by Mortgagor under any of the other
terms, covenants or conditions of the Note, this Mortgage or any other Loan
Document shall occur and such default shall not have been cured within thirty
(30) days after notice from Mortgagee, provided that if such default is not
susceptible of being cured within such thirty (30) day period and Mortgagor
shall have commenced the cure of such default within such thirty (30) day period
and thereafter diligently pursues such cure to completion, then such thirty (30)
day period shall be extended for a period of ninety (90) days from the
occurrence of the default, provided, further, that the notice and grace period
set forth in this subparagraph (j) shall not apply to any other Event of Default
expressly set forth in this PARAGRAPH 20 or to any other Event of Default
defined as such in any other Loan Document or to any other covenant or condition
with respect to which a grace period is expressly provided elsewhere; or

                      (k)    if any of the provisions of PARAGRAPHS 42(d) and/or
PARAGRAPH 42(f) are violated or not complied with, and/or if any representation
or warranty in PARAGRAPH 42(b) and/or 42(c) shall prove false or misleading in
any respect and/or if any of the events described in PARAGRAPH 42(e) shall
occur.

               Upon the occurrence of any Event of Default, the Indebtedness
shall immediately become due at the option of Mortgagee.

               Upon the occurrence of any Event of Default, Mortgagor shall pay
interest on the entire unpaid principal balance of the Note, as defined in and
provided for in the Note.

               Upon the occurrence of any Event of Default, Mortgagee may, to
the extent permitted under applicable law, elect to treat the fixtures included
in the Mortgaged Property either as real property or as personal property, or
both, and proceed to exercise such rights as apply thereto. With respect to any
sale of real property included in the Mortgaged Property made under the powers
of sale herein granted and conferred, Mortgagee may, to the extent permitted by
applicable law, include in such sale any fixtures included in the Mortgaged
Property and relating to such real property.

               21.    ADDITIONAL REMEDIES.

                      (a)    Upon the occurrence of any Event of Default,
Mortgagee may take such action, without notice or demand, as it shall deem
advisable to protect and enforce its rights against Mortgagor and in and to the
Mortgaged Property or any part thereof or interest therein, including, but not
limited to, the following actions, each of which may be pursued concurrently or
otherwise, at such time and in such order as Mortgagee may determine, in its
sole discretion, without impairing or otherwise affecting the other rights and
remedies of Mortgagee (i) enter into or upon the Real Property, either
personally or by its agents, nominees or attorneys and dispossess Mortgagor and
its agents and servants therefrom, and thereupon Mortgagee may (A) use, operate,
manage, control, insure, maintain, repair, restore and otherwise deal with all
and

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                                                                Loan No. 6518217

every part of the Mortgaged Property and conduct the business thereat, (B)
complete any construction on the Mortgaged Property in such manner and form as
Mortgagee deems advisable, (C) make alterations, additions, renewals,
replacements and improvements to or on the Mortgaged Property, (D) exercise all
rights and powers of Mortgagor with respect to the Mortgaged Property, whether
in the name of Mortgagor or otherwise, including, without limitation, the right
to make, cancel, enforce or modify leases, obtain and evict tenants and demand,
sue for, collect and receive all earnings, revenues, rents, issues, profits and
other income of the Mortgaged Property and every part thereof and (E) apply the
receipts from the Mortgaged Property to the payment of the Indebtedness, after
deducting therefrom all expenses (including reasonable attorneys' fees and
expenses) incurred in connection with the aforesaid operations and all amounts
necessary to pay the taxes, assessments, insurance and other charges in
connection with the Mortgaged Property, as well as just and reasonable
compensation for the services of counsel and other third parties providing
services to Mortgagee, or (ii) institute proceedings for the complete
foreclosure of this Mortgage in which case the Mortgaged Property may be sold
for cash or upon credit in one or more parcels, or (iii) with or without entry,
to the extent permitted and pursuant to the procedures provided by applicable
law, institute proceedings for the partial foreclosure of this Mortgage for the
portion of the Indebtedness then due and payable, subject to the continuing lien
of this Mortgage for the balance of the Indebtedness not then due, or (iv) sell
for cash or upon credit the Mortgaged Property or any part thereof and all or
any part of any estate, claim, demand, right, title and interest of Mortgagor
therein and rights of redemption thereof, pursuant to power of sale or
otherwise, at one or more sales, as an entirety or in parcels, at such time and
place, upon such terms and after such notice thereof as may be required or
permitted by law, and in the event of a sale, by foreclosure or otherwise, of
less than all of the Mortgaged Property, this Mortgage shall continue as a lien
on the remaining portion of or estate in the Mortgaged Property, or (v)
institute an action, suit or proceeding in equity for the specific performance
of any covenant, condition or agreement contained herein or in the Note or any
other Loan Document, or (vi) recover judgment on the Note or any Guaranty either
before, during or after any proceedings for the enforcement of this Mortgage, or
(vii) pursue such other remedies as Mortgagee may have under applicable law.

                      (b)    The purchase money proceeds or avails of any sale
made under or by virtue of this PARAGRAPH 21, together with any other sums which
then may be held by Mortgagee under this Mortgage, whether under the provisions
of this PARAGRAPH 21 or otherwise, shall be applied as follows:

               FIRST:     To the payment of the costs and expenses of any such
sale, including reasonable compensation to Mortgagee, its agents and counsel,
and of any judicial proceedings wherein the same may be made, and of all
expenses, liabilities and advances made or incurred by Mortgagee under this
Mortgage, together with interest as provided herein on all advances made by
Mortgagee and all taxes or assessments, except any taxes, assessments or other
charges subject to which the Mortgaged Property shall have been sold.

               SECOND:    To the payment of the whole amount then due, owing or
unpaid upon the Note for principal, together with any and all applicable
interest, fees and late charges.

               THIRD:     To the payment of any other sums required to be paid
by Mortgagor pursuant to any provision of this Mortgage or of the Note or of the
Guaranty.

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                                                                Loan No. 6518217

               FOURTH:    To the payment of the surplus, if any, to whomsoever
may be lawfully entitled to receive the same.

               Mortgagee and any receiver of the Mortgaged Property, or any part
thereof, shall be liable to account for only those rents, issues and profits
actually received by it.

                      (c)    Mortgagee may adjourn from time to time any sale by
Mortgagee to be made under or by virtue of this Mortgage by announcement at the
time and place appointed for such sale or for such adjourned sale or sales; and,
except as otherwise provided by any applicable provision of law, Mortgagee,
without further notice or publication, may make such sale at the time and place
to which the same shall be so adjourned.

                      (d)    Upon the completion of any sale or sales made by
Mortgagee under or by virtue of this PARAGRAPH 21, Mortgagee, or an officer of
any court empowered to do so, shall execute and deliver to the accepted
purchaser or purchasers a good and sufficient instrument, or good and sufficient
instruments, conveying, assigning and transferring all estate, right, title and
interest in and to the property and rights sold. Mortgagee is hereby irrevocably
appointed the true and lawful attorney of Mortgagor, in its name and stead, to
make all necessary conveyances, assignments, transfers and deliveries of the
Mortgaged Property and rights so sold and for that purpose Mortgagee may execute
all necessary instruments of conveyance, assignment and transfer, and may
substitute one or more persons with like power, Mortgagor hereby ratifying and
confirming all that its said attorney or such substitute or substitutes shall
lawfully do by virtue hereof. Any such sale or sales made under or by virtue of
this PARAGRAPH 21, whether made under the power of sale herein granted or under
or by virtue of judicial proceedings or of a judgment or decree of foreclosure
and sale, shall operate to divest all the estate, right, title, interest, claim
and demand whatsoever, whether at law or in equity, of Mortgagor in and to the
properties and rights so sold, and shall be a perpetual bar both at law and in
equity against Mortgagor and against any and all persons claiming or who may
claim the same, or any part thereof from, through or under Mortgagor.

                      (e)    In the event of any sale made under or by virtue of
this PARAGRAPH 21 (whether made under the power of sale herein granted or under
or by virtue of judicial proceedings or of a judgment or decree of foreclosure
and sale) the entire Indebtedness, if not previously due and payable,
immediately thereupon shall, anything in the Note, this Mortgage, any Guaranty
or any other Loan Document to the contrary notwithstanding, become due and
payable.

                      (f)    Upon any sale made under or by virtue of this
PARAGRAPH 21 (whether made under the power of sale herein granted or under or by
virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale), Mortgagee may bid for and acquire the Mortgaged Property or any part
thereof and in lieu of paying cash therefor may make settlement for the purchase
price by crediting upon the Indebtedness the net sales price after deducting
therefrom the expenses of the sale and the costs of the action and any other
sums which Mortgagee is authorized to deduct under this Mortgage.

                      (g)    No recovery of any judgment by Mortgagee and no
levy of an execution under any judgment upon the Mortgaged Property or upon any
other property of

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                                                                Loan No. 6518217

Mortgagor shall affect in any manner or to any extent, the lien of this Mortgage
upon the Mortgaged Property or any part thereof, or any liens, rights, powers or
remedies of Mortgagee hereunder, but such liens, rights, powers and remedies of
Mortgagee shall continue unimpaired as before.

               22.    RIGHT TO CURE DEFAULTS. Upon the occurrence of any Event
of Default or if Mortgagor fails to make any payment or to do any act as herein
provided, Mortgagee may, but without any obligation to do so and without notice
to or demand on Mortgagor and without releasing Mortgagor from any obligation
hereunder, make or do the same in such manner and to such extent as Mortgagee
may deem necessary to protect the security hereof. Without limiting the
foregoing, Mortgagee may enter upon the Mortgaged Property for such purposes or
appear in, defend, or bring any action or proceeding to protect its interest in
the Mortgaged Property, and the cost and expense thereof (including, without
limitation, reasonable attorneys' fees and disbursements to the extent permitted
by law), with interest as provided in this PARAGRAPH 22, shall be immediately
due and payable to Mortgagee upon demand by Mortgagee therefor. All such costs
and expenses incurred by Mortgagee in remedying such Event of Default or in
appearing in, defending, or bringing any such action or proceeding shall bear
interest at the Default Rate (as such term is defined in the Note), for the
period from the date that such cost or expense was incurred to the date of
payment to Mortgagee. All such costs and expenses, together with interest
thereon at the Default Rate, shall be added to the Indebtedness and shall be
secured by this Mortgage. If the principal sum of the Note or any other amount
required to be paid on the Maturity Date under the Note shall not be paid on the
Maturity Date, interest shall thereafter be computed and paid at the Default
Rate.

               23.    LATE PAYMENT CHARGE. If any monthly principal and interest
payment is not paid in accordance with the Note, a late charge (the "LATE
CHARGE") shall be due as provided for in the Note.

               24.    PREPAYMENT. The Indebtedness may be prepaid only in
accordance with the terms of the Note.

               25.    PREPAYMENT AFTER EVENT OF DEFAULT. A tender of the amount
necessary to satisfy the entire indebtedness, paid at any time following an
Event of Default or acceleration (which acceleration shall be at Mortgagee's
sole option), including at a foreclosure sale or during any subsequent
redemption period, if any, shall be deemed a voluntary prepayment, which payment
shall include a premium, the calculation of which shall be in accordance with
the terms of the Note and shall depend upon whether the Event of Default or
acceleration first occurred (i) prior to the time, if any, the prepayment of the
principal balance is permitted pursuant to the terms of the Note and prior to
the date on which the full amount of the balance of principal and interest then
remaining unpaid shall be due or (ii) on or after the date on which prepayment
of the principal balance is permitted pursuant to the terms of the Note.

               26.    APPOINTMENT OF RECEIVER. Mortgagee, upon the occurrence of
an Event of Default or in any action to foreclose this Mortgage or upon the
actual or threatened waste to any part of the Mortgaged Property, shall be
entitled to the appointment of a receiver without notice and without regard to
the value or condition of the Mortgaged Property as security for the

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                                                                Loan No. 6518217

Indebtedness or the solvency or insolvency of any person liable for the payment
of the Indebtedness.

               27.    SECURITY AGREEMENT.

                      (a)    This Mortgage is both a real property Mortgage and
a "security agreement" within the meaning of the Uniform Commercial Code. The
Mortgaged Property includes both real and personal property and all other rights
and interests, whether tangible or intangible in nature, of Mortgagor in the
Mortgaged Property. Mortgagor, by executing and delivering this Mortgage grants
to Mortgagee, as security for the Indebtedness, a security interest in the
Mortgaged Property to the full extent that the Mortgaged Property may be subject
to the Uniform Commercial Code (such portion of the Mortgaged Property so
subject to the Uniform Commercial Code being called in this PARAGRAPH 27 the
"COLLATERAL"). Mortgagor hereby authorizes Mortgagee to file financing
statements in order to create, perfect, preserve and continue the security
interest(s) herein granted. This Mortgage shall also constitute a "fixture
filing" for the purposes of the Uniform Commercial Code and shall cover all
items of the Collateral that are or are to become fixtures. Information
concerning the security interest(s) herein granted may be obtained from
Mortgagee upon request.

                      If an Event of Default shall occur, Mortgagee, in addition
to any other rights and remedies which it may have, shall have and may exercise
immediately and without demand, any and all rights and remedies granted to a
secured party upon default under the Uniform Commercial Code, including, without
limiting the generality of the foregoing, the right to take possession of the
Collateral or any part thereof, and to take such other measures as Mortgagee may
deem necessary for the care, protection and preservation of the Collateral. Upon
request or demand of Mortgagee, Mortgagor shall at its expense assemble the
Collateral and make it available to Mortgagee at a convenient place reasonably
acceptable to Mortgagee. Mortgagor shall pay to Mortgagee on demand any and all
expenses, including legal expenses and attorneys' fees and disbursements,
incurred or paid by Mortgagee in protecting its interest in the Collateral and
in enforcing its rights hereunder with respect to the Collateral. Any notice of
sale, disposition or other intended action by Mortgagee with respect to the
Collateral sent to Mortgagor in accordance with the provisions hereof at least
five (5) days prior to such sale, disposition or action shall constitute
reasonable notice to Mortgagor. The proceeds of any disposition of the
Collateral, or any part thereof, may be applied by Mortgagee to the payment of
the Indebtedness in such priority and proportions as Mortgagee in its discretion
shall deem proper.

                      Mortgagor shall notify Mortgagee of any change in name,
identity or structure of Mortgagor and shall promptly execute, file and record,
at its sole cost and expense, such Uniform Commercial Code forms as are
necessary to maintain the priority of the lien of Mortgagee upon and security
interest in the Collateral. In addition, Mortgagor shall promptly execute, file
and record such additional Uniform Commercial Code forms or continuation
statements as Mortgagee shall deem necessary and shall pay all expenses and fees
in connection with the filing and recording thereof, provided that no such
additional documents shall increase the obligations of Mortgagor under the Note,
this Mortgage or the other Loan Documents. Mortgagor hereby grants to Mortgagee
an irrevocable power of attorney, coupled with an interest, to file with the
appropriate public office on its behalf any financing or other statements

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                                                                Loan No. 6518217

signed only by Mortgagee, as secured party, in connection with the Collateral
covered by this Mortgage.

                      (b)    That portion of the Mortgaged Property consisting
of personal property and equipment, shall be owned by Mortgagor and shall not be
the subject matter of any lease or other transaction whereby the ownership or
any beneficial interest in any of such property is held by any person or entity
other than Mortgagor nor shall Mortgagor create or suffer to be created any
security interest covering any such property as it may from time to time be
replaced, other than the security interest created herein.

               28.    AUTHORITY.

                      (a)    Mortgagor has full power, authority and legal right
to execute this Mortgage, and to mortgage, give, grant, bargain, sell, alien,
enfeoff, convey, confirm, pledge, hypothecate and assign and grant a security
interest in the Mortgaged Property pursuant to the terms hereof and to keep and
observe all of the terms of this Mortgage on Mortgagor's part to be performed.

                      (b)    Mortgagor represents and warrants to Mortgagee that
Mortgagor is not a "foreign person" and covenants with Mortgagee that Mortgagor
will not, throughout the term of the Note, become a "foreign person" within the
meaning of Section 1445 and Section 7701 of the Internal Revenue Code of 1986,
(26 USC Sections 1445, 7701) and the related Treasury Department regulations,
including, without limitation, temporary regulations (hereinafter collectively
the "CODE"); that is, such Mortgagor is not a non-resident alien, foreign
corporation, foreign partnership, foreign trust or foreign estate as those terms
are defined in the Code.

                      (c)    Mortgagor represents and warrants to Mortgagee that
Mortgagor is a limited liability company organized and existing under the laws
of the State of Delaware.

               29.    ACTIONS AND PROCEEDINGS. Mortgagee shall have the right to
appear in and defend any action or proceeding brought with respect to the
Mortgaged Property and to bring any action or proceeding, in the name and on
behalf of Mortgagor, which Mortgagee, in its discretion, shall decide should be
brought to protect its interest(s) in the Mortgaged Property.

               30.    FURTHER ACTS, ETC. Mortgagor will, at the sole cost of
Mortgagor, and without expense to Mortgagee, do, execute, acknowledge and
deliver all and every such further acts, deeds, conveyances, mortgages,
assignments, notices of assignments, transfers and assurances as Mortgagee
shall, from time to time, require, for the better assuring, conveying,
assigning, transferring and confirming unto Mortgagee the property and rights
hereby mortgaged, given, granted, bargained, sold, aliened, enfeoffed, conveyed,
confirmed, pledged, assigned and hypothecated or intended now or hereafter so
to be, or which Mortgagor may be or may hereafter become bound to convey or
assign to Mortgagee, or for carrying out the intention or facilitating the
performance of the terms of this Mortgage or for filing, registering or
recording this Mortgage and, on demand, will execute and deliver within five (5)
business days after request of Mortgagee, and if Mortgagor fails to so deliver,
hereby authorizes Mortgagee thereafter to execute in the name of Mortgagor
without the signature of Mortgagor to the extent Mortgagee may lawfully do so,
one or more financing statements, chattel mortgages or

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                                                                Loan No. 6518217

comparable security instruments, to evidence more effectively the lien hereof
upon the Mortgaged Property. Mortgagor grants to Mortgagee an irrevocable power
of attorney coupled with an interest for the purpose of exercising and
perfecting any and all rights and remedies available to Mortgagee at law and in
equity, including without limitation such rights and remedies available to
Mortgagee pursuant to this PARAGRAPH 30.

               31.    RECORDING OF MORTGAGE, ETC. Mortgagor forthwith upon the
execution and delivery of this Mortgage, will cause this Mortgage, and any
security instrument creating a lien or security interest or evidencing the lien
hereof upon the Mortgaged Property, to be filed, registered or recorded and,
thereafter, from time to time, each such other instrument of further assurance
to be filed, registered or recorded, all in such manner and in such places as
may be required by any present or future law in order to publish notice of and
fully to protect the lien or security interest hereof upon, and the interest(s)
of Mortgagee in, the Mortgaged Property. Mortgagor will pay all filing,
registration or recording fees, and all expenses incident to the preparation,
execution and acknowledgment of this Mortgage, any Mortgage supplemental hereto,
any security instrument with respect to the Mortgaged Property and any
instrument of further assurance, and all federal, state, county and municipal,
taxes, duties, imposts, assessments and charges arising out of or in connection
with the making, execution, delivery and/or recording of this Mortgage, any
Mortgage supplemental hereto, any security instrument with respect to the
Mortgaged Property or any instrument of further assurance, except where
prohibited by law so to do. Mortgagor shall hold harmless and indemnify
Mortgagee, its successors and assigns, against any liability incurred by reason
of the imposition of any tax on the making, execution, delivery and/or recording
of this Mortgage, any Mortgage supplemental hereto, any security instrument with
respect to the Mortgaged Property or any instrument of further assurance.

               32.    USURY LAWS. This Mortgage and the Note are subject to the
express condition that at no time shall Mortgagor be obligated or required to
pay interest on the principal balance due under the Note at a rate which could
subject the holder of the Note to either civil or criminal liability as a result
of being in excess of the maximum interest rate which Mortgagor is permitted by
law to contract or agree to pay. If by the terms of this Mortgage or the Note,
Mortgagor is at any time required or obligated to pay interest on the principal
balance due under the Note at a rate in excess of such maximum rate, the rate of
interest under the Note shall be deemed to be immediately reduced to such
maximum rate and the interest payable shall be computed at such maximum rate and
all prior interest payments in excess of such maximum rate shall be applied and
shall be deemed to have been payments in reduction of the principal balance of
the Note and the principal balance of the Note shall be reduced by such amount
in the inverse order of maturity.

               33.    SOLE DISCRETION OF MORTGAGEE. Wherever pursuant to this
Mortgage, Mortgagee exercises any right given to it to approve or disapprove, or
any arrangement or term is to be satisfactory to Mortgagee, the decision of
Mortgagee to approve or disapprove or to decide that arrangements or terms are
satisfactory or not satisfactory shall be in the sole discretion of Mortgagee
and shall be final and conclusive, except as may be otherwise specifically
provided herein.

               34.    RECOVERY OF SUMS REQUIRED TO BE PAID. Mortgagee shall have
the right from time to time to take action to recover any sum or sums which
constitute a part of the

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                                                                Loan No. 6518217

Indebtedness as the same become due, without regard to whether or not the
balance of the Indebtedness shall be due, and without prejudice to the right of
Mortgagee thereafter to bring an action of foreclosure, or any other action, for
a default or defaults by Mortgagor existing at the time such earlier action was
commenced.

               35.    MARSHALLING AND OTHER MATTERS. Mortgagor waives, to the
extent permitted by law, the benefit of all appraisement, valuation, stay,
extension, reinstatement and redemption laws now or hereafter in force and all
rights of marshalling in the event of any sale hereunder of the Mortgaged
Property or any part thereof or any interest therein. Further, Mortgagor
expressly waives any and all rights of redemption from sale under any order or
decree of foreclosure of this Mortgage on behalf of Mortgagor, and on behalf of
each and every person acquiring any interest in or title to the Mortgaged
Property subsequent to the date of this Mortgage and on behalf of all persons to
the extent permitted by applicable law.

               36.    WAIVER OF NOTICE. Mortgagor shall not be entitled to any
notices of any nature whatsoever from Mortgagee except with respect to matters
for which this Mortgage specifically and expressly provides for the giving of
notice by Mortgagee to Mortgagor and except with respect to matters for which
Mortgagee is required by applicable law to give notice, and Mortgagor hereby
expressly waives the right to receive any notice from Mortgagee with respect to
any matter for which this Mortgage does not specifically and expressly provide
for the giving of notice by Mortgagee to Mortgagor.

               37.    REMEDIES OF MORTGAGOR. In the event that a claim or
adjudication is made that Mortgagee has acted unreasonably or unreasonably
delayed acting in any case where by law or under the Note, this Mortgage or the
other Loan Documents, it has an obligation to act reasonably or promptly,
Mortgagee shall not be liable for any monetary damages, and Mortgagor's remedies
shall be limited to injunctive relief or declaratory judgment.

               38.    REPORTING REQUIREMENTS. At the request of Mortgagee,
Mortgagor shall supply or cause to be supplied to Mortgagee either (a) a copy of
a completed Form 1099-B, Statement for Recipients of Proceeds from Real Estate,
Broker and Barter Exchange Proceeds prepared by Mortgagor's attorney or other
person responsible for the preparation of such form, together with a certificate
from the person who prepared such form to the effect that such form has, to the
best of such person's knowledge, been accurately prepared and that such person
will timely file such form or (b) a certification from Mortgagor that the Loan
is a refinancing of the Mortgaged Property or is otherwise not required to be
reported to the Internal Revenue Service pursuant to Section 6045(e) of the
Code. Mortgagor hereby indemnifies, defends and holds Mortgagee harmless from
and against all loss, cost, damage and expense (including without limitation,
attorneys' fees and disbursements and costs incurred in the investigation,
defense and settlement of claims) that Mortgagee may incur, directly or
indirectly, as a result of or in connection with the assertion against Mortgagee
of any claim relating to the failure of Mortgagee to comply with this PARAGRAPH
38.

               39.    HAZARDOUS MATERIALS.

                      (a)    Mortgagor represents and warrants that based on the
Phase I environmental report prepared by EBI Consultants dated September 5, 2003
(the "Report")

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                                                                Loan No. 6518217

(i) the Mortgaged Property is now and at all times during Mortgagor's ownership
thereof has been free of contamination from any petroleum product and all
hazardous or toxic substances, wastes or substances, any substances which
because of their quantitative concentration, chemical, radioactive, flammable,
explosive, infectious or other characteristics, constitute or may reasonably be
expected to constitute or contribute to a danger or hazard to public health,
safety or welfare or to the environment, including, without limitation, any
asbestos (whether or not friable) and any asbestos-containing materials, Mold
(defined as the presence of any form of (i) multicellular fungi that live on
plant or animal matter and an indoor environment (including without limitation
Cladosporium, Penicillium, Alternaria, Aspergillus, Fusarium, Trichoderma,
Memnoniella, Mucor, and Stachybotrys chartarum (SC) often found in water damaged
building materials), (ii) spores, scents or byproducts produced or released by
fungi, including mycotoxins and (iii) microbial matter which reproduces through
mold, mildew and viruses, whether or not such microbial matter is living
(collectively "MOLD")), waste oils, solvents and chlorinated oils,
polychlorinated biphenyls (PCBs), toxic metals, etchants, pickling and plating
wastes, explosives, reactive metals and compounds, pesticides, herbicides, radon
gas, urea formaldehyde foam insulation and chemical, biological and radioactive
wastes, or any other similar materials or any hazardous or toxic wastes or
substances which are included under or regulated by any federal, state or local
law, rule or regulation (whether now existing or hereafter enacted or
promulgated, as they may be amended from time to time) pertaining to
environmental regulations, contamination, clean-up or disclosures, and any
judicial or administrative interpretation thereof, including any judicial or
administrative orders or judgments ("HAZARDOUS MATERIALS"), including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, 42 U.S.C. section 9601 ET SEQ. ("CERCLA"); The Federal Resource
Conservation and Recovery Act, 42 U.S.C. section 6901 ET SEQ. ("RCRA");
Superfund Amendments and Reauthorization Act of 1986, Public Law No. 99-499
("SARA"); Toxic Substances Control Act, 15 U.S.C. section 2601 ET SEQ. ("TSCA");
the Hazardous Materials Transportation Act, 49 U.S.C. section 1801 ET SEQ.; and
any other state superlien or environmental clean-up or disclosure statutes (all
such laws, rules and regulations being referred to collectively as
"ENVIRONMENTAL LAWS"), (ii) Mortgagor has not caused or suffered to occur any
discharge, spill, uncontrolled loss or seepage of any Hazardous Materials onto
any property adjoining the Mortgaged Property, (iii) Mortgagor has not received
any complaint, notice, letter, or other communication from occupants, tenants,
guests, employees, licensees or any other person regarding odors, poor indoor
quality, Mold, or any activity, condition, event or omission that causes or
facilitates the growth of Mold and Mortgagor further represents to the best of
its knowledge that no Mold or any activity, condition, event or omission that
causes or facilitates the growth of Mold exists at the property, and (iv)
neither the Mortgagor nor to Mortgagor's best knowledge any tenant or occupant
of all or part of the Mortgaged Property is now or has been involved in
operations at the Mortgaged Property which could lead to liability for Mortgagor
or any other owner of the Mortgaged Property or the imposition of a lien on the
Mortgaged Property under any Environmental Law.

                      (b)    At its sole cost and expense, Mortgagor shall
comply with and shall cause all tenants and other occupants of the Mortgaged
Property to comply with all Environmental Laws now in effect or hereafter
enacted with respect to the discharge, generation, removal, transportation,
storage and handling of Hazardous Materials. Mortgagor shall promptly notify
Mortgagee if Mortgagor shall become aware of any Hazardous Materials on or near
the Mortgaged Property (except materials which (i) are ordinarily and
customarily used in the

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                                                                Loan No. 6518217

regular operation of the Mortgaged Property as a commercial retail facility by
the Mortgagor or any current tenant or any future tenant, which tenant and its
Lease have been approved by the Mortgagee, and (ii) are used, stored, disposed
of and handled in compliance with and in quantities permitted by all applicable
Environmental Laws) and/or if Mortgagor shall become aware that the Mortgaged
Property is in direct or indirect violation of any Environmental Laws and/or if
Mortgagor shall become aware of any condition on or near the Mortgaged Property
which shall pose a threat to the health, safety or welfare of humans. Mortgagor
shall promptly remove all Hazardous Materials from the Mortgaged Property, such
removal to be performed in accordance with all applicable federal, state and
local laws, statutes, rules and regulations. Mortgagor shall pay immediately
when due the cost of removal of any Hazardous Materials and shall keep the
Mortgaged Property free of any lien imposed pursuant to any Environmental Laws
now in effect or hereinafter enacted.

                      (c)    Mortgagor grants Mortgagee and its employees and
agents an irrevocable and non-exclusive license, subject to the rights of
tenants, to enter the Mortgaged Property in the event that Mortgagee has a
reasonable belief that a violation of Environmental Laws or release or
threatened release of Hazardous Materials has occurred on or onto the Mortgaged
Property, or at any time after an uncured Event of Default under the Loan
Documents, to conduct testing and to remove any Hazardous Materials, and the
costs of such testing and removal shall immediately become due to Mortgagee and
shall be secured by this Mortgage. Mortgagor, promptly upon the request of
Mortgagee, and only if Mortgagee has a reasonable belief that there is a change
in the environmental condition of the Mortgaged Property, shall provide
Mortgagee with an environmental site assessment or environmental audit report,
or an update of such an assessment or report, all in scope, form and content
satisfactory to Mortgagee. Mortgagor shall maintain the integrity of all storage
tanks and drums on or under the Mortgaged Property during the term of the Loan
in compliance with all Environmental Laws now in effect or hereinafter enacted.
Mortgagor shall follow an operation and maintenance program with respect to all
storage tanks and drums on or under the Mortgaged Property, which program has
been approved in writing by Mortgagee.

                      (d)    Mortgagor shall indemnify Mortgagee and hold
Mortgagee harmless from and against all liability, loss, cost, damage and
expense (including, without limitation, reasonable attorneys' fees and costs
incurred in the investigation, defense and settlement of claims) that Mortgagee
may incur as a result of or in connection with the assertion against Mortgagee
(whether as past or present holder of this Mortgage, as mortgagee in possession
or as past or present owner of the Mortgaged Property by virtue of a foreclosure
or acceptance of a deed in lieu of foreclosure) of any claim relating to the
presence and/or release, threatened release, storage, disposal, generating or
removal of any Hazardous Materials or compliance with any Environmental Laws now
in effect or hereinafter enacted except for the gross negligence or willful
misconduct of Mortgagee. Subject to the provisions of Paragraph 9(f) above, the
obligations and liabilities of Mortgagor under this PARAGRAPH 39 shall survive
full payment of the Loan, entry of a judgment of foreclosure or acceptance of a
deed in lieu of foreclosure or any subsequent transfer to a third party. It is
understood that the presence and/or release of substances referred to in this
section hereof does not pertain to a presence and/or release which first occurs
solely after (A) repayment of the Loan in full in accordance with the Loan
Documents or (B) possession of the Property by Mortgagee upon a foreclosure or
acceptance of a deed in lieu of foreclosure and surrender of possession and
occupancy of the

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                                                                Loan No. 6518217

Property by Mortgagor, its agents, affiliates, employees and independent
contractors. Mortgagor shall have the burden of establishing that the conditions
in subsection (d) were satisfied by clear and convincing evidence and shall
indemnify and hold Mortgagee harmless for all matters set forth in this
Paragraph 39, until Mortgagor has met such burden; Mortgagee agrees that
Mortgagor shall have met such burden with respect to the Mortgaged Property if
Mortgagor at such time delivers to Mortgagee a clean Phase I environmental
assessment report satisfactory in all respects to Mortgagee if prior to delivery
thereof there has not occurred any release of Hazardous Materials at the
Mortgaged Property nor has there been any prior violation of environmental laws
at the Mortgaged Property (and if there has been a release of Hazardous
Materials or a violation of Environmental Laws, in such instance in lieu of
delivery of such Phase I environmental assessment Mortgagor shall deliver to
Mortgagee an environmental insurance policy satisfactory in all respects to
Mortgagee in its reasonable discretion).

                      (e)    Nothing contained herein shall constitute or be
construed as a waiver of any statutory or judicial federal, state or local law
which may provide rights or remedies to Mortgagee against Mortgagor or others in
connection with any claim relating to the Mortgaged Property and pertaining to
the presence and/or release, threatened release, storage, disposal, generating
or removal of any Hazardous Materials or to the failure to comply with any
Environmental Laws now or hereafter enacted.

               40.    ASBESTOS. Mortgagor shall not install or permit to be
installed in the Mortgaged Property, friable asbestos or any substance
containing asbestos. With respect to any such material currently present in the
Mortgaged Property, Mortgagor, at Mortgagor's expense, shall promptly comply
with and shall cause all occupants of the Mortgaged Property to comply with all
present and future applicable federal, state or local laws, rules, regulations
or orders relating to asbestos, friable asbestos and asbestos containing
materials. In the event any asbestos, friable asbestos or asbestos containing
material is discovered at the Mortgaged Property, Mortgagor shall obtain a
comprehensive asbestos report prepared by a licensed engineer or asbestos
consultant acceptable to Mortgagee describing the form, extent, location and
condition of such asbestos and recommending methods of removal or abatement.
Mortgagor shall promptly comply at its sole cost and expense with the
recommendations contained in such report, such compliance to be performed in
accordance with all applicable federal, state and local laws, statutes, rules
and regulations. Mortgagor shall indemnify Mortgagee and hold Mortgagee harmless
from and against all loss, cost, damage and expense (including, without
limitation, attorneys' fees and costs incurred in the investigation, defense and
settlement of claims) that Mortgagee may incur as a result of or in connection
with the assertion against Mortgagee (whether as past or present holder of the
Mortgage, as mortgagee in possession, or as past or present owner of the
Mortgaged Property by virtue of a foreclosure or acceptance of a deed in lieu of
foreclosure) of any claim relating to the presence or removal of any asbestos
substance referred to in this PARAGRAPH 40, or compliance with any federal,
state or local laws, rules, regulations or orders relating thereto. The
obligations and liabilities of Mortgagor under this PARAGRAPH 40 shall survive
full payment of the Loan, a foreclosure or the acceptance of a deed in lieu of
foreclosure.

               41.    BANKRUPTCY OR INSOLVENCY. In the event that Mortgagor or
any Guarantor or, if Mortgagor or any Guarantor is a general or limited
partnership, any general partner of any such entity (a) admits in writing its
inability to pay its debts generally as they become due, or

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                                                                Loan No. 6518217

does not pay its debts generally as they become due, (b) commences as debtor any
case or proceeding under any bankruptcy, insolvency, reorganization,
liquidation, dissolution or similar law, or seeks or consents to the appointment
of a receiver, conservator, trustee, custodian, manager, liquidator or similar
official for it or the whole or any substantial part of its property, (c) has a
receiver, conservator, trustee, custodian, manager, liquidator, or similar
official appointed for it or the whole or any substantial part of its property,
by any governmental authority with jurisdiction to do so, (d) makes a proposal
or any assignment for the benefit of its creditors, or enters into an
arrangement or composition or similar plan or scheme with or for the benefit of
creditors generally occurring in circumstances in which such entity is unable to
meet its obligations as they become due or (e) has filed against it any case or
proceeding under any bankruptcy, insolvency, reorganization, liquidation,
dissolution or similar law which (i) is consented to or not timely contested by
such entity, (ii) results in the entry of an order for relief, appointment of a
receiver, conservator, trustee, custodian, manager, liquidator or similar
official for such entity or the whole or any substantial part of its property or
(iii) is not dismissed within sixty (60) days, an Event of Default shall have
occurred and as a result, the entire principal balance of the Note and all
obligations under any Guaranty shall become immediately due and payable at the
option of Mortgagee without notice to Mortgagor or any Guarantor and Mortgagee
may exercise any remedies available to it hereunder, under any other Loan
Document, at law or in equity.

               42.    COMPLIANCE WITH ERISA AND STATE STATUTES ON GOVERNMENTAL
PLANS.

                      (a)    Mortgagee represents and warrants to Mortgagor
that, as of the date of this Mortgage and throughout the term of this Mortgage,
the source of funds from which Mortgagee extends this Mortgage is its general
account, which is subject to the claims of its general creditors under state
law.

                      (b)    Mortgagor represents and warrants that, as of the
date of this Mortgage and throughout the term of this Mortgage, (i) Mortgagor is
not an "employee benefit plan" as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), which is subject
to Title I of ERISA and (ii) the assets of such Mortgagor do not constitute
"plan assets" of one or more such plans within the meaning of 29 C.F.R. Section
2510.3-101.

                      (c)    Mortgagor represents and warrants to Mortgagee
that, as of the date of this Mortgage and throughout the term of this Mortgage
(i) Mortgagor is not a "governmental plan" within the meaning of Section 3(32)
of ERISA and (ii) transactions by or with Mortgagor or any Mortgagor are not
subject to state statues regulating investments of and fiduciary obligations
with respect to governmental plans.

                      (d)    Mortgagor covenants and agrees to deliver to
Mortgagee such certifications or other evidence from time to time throughout the
term of this Mortgage, as reasonably requested by Mortgagee in its sole
discretion, that (i) Mortgagor is not an "employee benefit plan" or a
"governmental plan", (ii) Mortgagor is not subject to state statutes regulating
investments and fiduciary obligations with respect to governmental plans, and
(iii) one or more of the following circumstances is true:

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                                                                Loan No. 6518217

                      (A)    Equity interests in Mortgagor are publicly offered
                             securities, within the meaning of 29 C.F.R. Section
                             2510.3-101(b)(2);

                      (B)    Less than 25 percent of all equity interests in
                             such Mortgagor are held by "benefit plan investors"
                             within the meaning of 29 C.F.R. Section
                             2510.3-101(f)(2); or

                      (C)    Mortgagor qualifies as an "operating company" or a
                             "real estate operating company" within the meaning
                             of 29 C.F.R. Section 2510.3.-101(c) or (e).

                      (e)    Any of the following shall constitute an Event of
Default under this Mortgage, entitling Mortgagee to exercise any and all
remedies to which it may be entitled under this Mortgage, and any other Loan
Documents (i) the failure of any representation or warranty made by any
Mortgagor under this PARAGRAPH 42 to be true and correct in all respects, (ii)
the failure of any Mortgagor to provide Mortgagee with the written
certifications and evidence referred to in this PARAGRAPH 42 within five (5)
days after written notice or (iii) the consummation by Mortgagor or any one
Mortgagor of a transaction which would cause this Mortgage or any exercise of
Mortgagee's rights under this Mortgage, or the other Loan Documents to
constitute a non-exempt prohibited transaction under ERISA or a violation of a
state statute regulating governmental plans, or otherwise subjecting Mortgagee
to liability for violation of ERISA or such state statute.

                      (f)    Mortgagor shall indemnify Mortgagee and defend and
hold Mortgagee harmless from and against all civil penalties, excise taxes, or
other loss, cost, damage and expense (including, without limitation, reasonable
attorneys' fees and disbursements and costs incurred in the investigation,
defense and settlement of claims and losses incurred in correcting any
prohibited transaction or in the sale of a prohibited loan, and in obtaining any
individual prohibited transaction exemption under ERISA that may be required, in
Mortgagee's sole discretion) that Mortgagee may incur, directly or indirectly,
as a result of a default under this PARAGRAPH 42. This indemnity shall survive
any termination, satisfaction or foreclosure of this Mortgage.

               43.    ASSIGNMENTS. Mortgagee shall have the right to assign or
transfer its rights under this Mortgage without limitation at no cost to
Mortgagor. Any assignee or transferee shall be entitled to all the benefits
afforded Mortgagee under this Mortgage.

               44.    COOPERATION. Mortgagor acknowledges that Mortgagee and its
successors and assigns may (a) sell this Mortgage, the Note and other Loan
Documents to one or more investors as a whole loan, (b) participate the Loan to
one or more investors, (c) deposit this Mortgage, the Note and other Loan
Documents with a trust, which trust may sell certificates to investors
evidencing an ownership interest in the trust assets or (d) otherwise sell the
Loan or interest therein to investors (the transactions referred to in clauses
(a) through (d) are hereinafter referred to as "SECONDARY MARKET TRANSACTIONS").
Mortgagor shall cooperate in good faith with Mortgagee (aa) in effecting any
such Secondary Market Transaction and (bb) to implement all requirements imposed
by the Rating Agency involved in any Secondary Market Transaction including,
without limitation, all structural or other changes to the Loan, modifications
to any

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                                                                Loan No. 6518217

documents evidencing or securing the Loan, delivery of opinions of counsel
acceptable to the Rating Agency and addressing such matters as the Rating Agency
may require; PROVIDED, HOWEVER, that Mortgagor shall not be required to modify
any documents evidencing or securing the Loan which would modify (i) the
interest rate payable under the Note, (ii) the stated maturity of the Note,
(iii) the amortization of principal of the Note or (iv) any other material
economic term of the Loan. Mortgagor shall provide such information and
documents relating to Mortgagor, Guarantor, if any, the Mortgaged Property, the
Leases and the tenants thereunder as Mortgagee may reasonably request in
connection with a Secondary Market Transaction. Mortgagee shall have the right
to provide to prospective investors any information in its possession,
including, without limitation, financial statements relating to Mortgagor, the
Guarantor, if any, the Mortgaged Property and the tenants under the Leases.
Mortgagor acknowledges that certain information regarding the Loan and the
parties thereto and the Mortgaged Property may be included in a private
placement memorandum, prospectus or other disclosure documents.

               45.    INDEMNIFICATION FOR NON-RECOURSE CARVEOUT OBLIGATIONS.
Mortgagor hereby covenants and agrees unconditionally and absolutely to
indemnify and save harmless Mortgagee, its officers, directors, shareholders,
employees, agents and attorneys against all damages, losses, liabilities,
obligation, claims, litigation, demands or defenses, judgments, suits,
proceedings, fines, penalties, costs, disbursements and expenses of any kind or
nature whatsoever (including without limitation attorneys' fees reasonably
incurred), which may at any time be imposed upon, incurred by or asserted or
awarded against Mortgagee and arising from the Non-Recourse Carveout Obligations
except to the extent arising from the gross negligence or willful misconduct of
Mortgagee.

               This indemnity shall survive any foreclosure of this Mortgage,
the taking of a deed in lieu thereof, or any other discharge of the obligations
of the Mortgagor hereunder or a transfer of the Mortgaged Property, even if the
indebtedness secured hereby is satisfied in full. Mortgagor agrees that the
indemnification granted herein may be enforced by Mortgagee without resorting to
or exhausting any other security or collateral or without first having recourse
to the Note or the Mortgaged Property covered by this Mortgage through
foreclosure proceedings or otherwise; provided, however, that, subject to
PARAGRAPH 46 of this Mortgage, nothing herein contained shall prevent Mortgagee
from suing on the Note or foreclosing this Mortgage or from exercising any other
rights under the Loan Documents.

               46.    EXCULPATION. Notwithstanding anything to the contrary
contained herein, but subject to PARAGRAPH 45 hereof, any claim based on or in
respect of any liability of Mortgagor under the Note or under this Mortgage or
any other Loan Document shall be enforced only against the Mortgaged Property
and any other collateral now or hereafter given to secure the Loan and not
against any other assets, properties or funds of Mortgagor; PROVIDED, HOWEVER,
that the liability of Mortgagor for loss, costs or damage arising out of the
matters described below (collectively, "Non-Recourse Carveout Obligations")
shall not be limited solely to the Mortgaged Property and other collateral now
or hereafter given to secure the Loan but shall include all of the assets,
properties and funds of Mortgagor: (i) fraud, misrepresentation and waste, (ii)
any rents, issues or profits collected more than one (1) month in advance of
their due dates to the extent such sums remain collected more than one month in
advance of their due dates following an Event of Default, (iii) any
misapplication of rents, issues or profits, security deposits and any

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                                                                Loan No. 6518217

other payments from tenants or occupants (including, without limitation, lease
termination fees) insurance proceeds, condemnation awards, or other sums of a
similar nature to the extent such misapplication continues following an Event of
Default, (iv) liability under environmental covenants, conditions and
indemnities contained in this Mortgage and in any separate environmental
indemnity agreements, (v) personalty or fixtures removed or allowed to be
removed by or on behalf of Mortgagor and not replaced by items of equal or
greater value or functionality than the personalty or fixtures so removed, (vi)
failure to pay taxes, assessments or ground rents prior to delinquency, or to
pay charges for labor, materials or other charges which can create liens on any
portion of the Mortgaged Property and any sums expended by Mortgagee in the
performance of or compliance with the obligations of Mortgagor under the Loan
Documents, including, without limitation, sums expended to pay taxes or
assessments or hazard insurance premiums or bills for utilities or other
services or products for the benefit of the Mortgaged Property, (vii) the
unauthorized sale, conveyance or transfer of title to the Mortgaged Property or
encumbrance of the Mortgaged Property, (viii) the failure of Mortgagor to
maintain its status as a single purpose, bankruptcy-remote entity pursuant to
its organizational documents and the Loan Documents, and (ix) reasonable
attorney's fees, court costs and other expenses incurred by Mortgagee in
connection with enforcement of Mortgagor's personal liability as set forth
herein. Nothing herein shall be deemed (w) to be a waiver of any right which
Mortgagee may have under any bankruptcy law of the United States or the state
where the Mortgaged Property is located including, but not limited to, Section
506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code, to
file a claim for the full amount of the indebtedness secured by this Mortgage or
to require that all of the collateral securing the indebtedness secured hereby
shall continue to secure all of the indebtedness owing to Mortgagee under the
Note, this Mortgage and the other Loan Documents; (x) to impair the validity of
the indebtedness secured by this Mortgage; (y) to impair the right of Mortgagee
as Mortgagee or secured party to commence an action to foreclose any lien or
security interest; or (z) to modify, diminish or discharge the liability of any
Guarantor under any Guaranty.

               47.    NOTICES. Any notice, demand, statement, request or consent
made hereunder shall be effective and valid only if in writing, referring to
this Mortgage, signed by the party giving such notice, and delivered either
personally to such other party, or sent by nationally recognized overnight
courier delivery service or by certified mail of the United States Postal
Service, postage prepaid, return receipt requested, addressed to the other party
as follows (or to such other address or person as either party or person
entitled to notice may by notice to the other party specify):

               TO MORTGAGEE:

               John Hancock Life Insurance Company
               Real Estate Investment Group
               John Hancock Tower, T-56
               200 Clarendon Street
               Boston, Massachusetts 02116
               Re: Loan No. 6518217

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                                                                Loan No. 6518217

               with a copy concurrently to:

               John Hancock Life Insurance Company
               John Hancock Tower, T-30
               200 Clarendon Street
               Boston, MA 02116
               Attention: Nathaniel I. Margolis, Esq.

               TO MORTGAGOR:

               Inland Southeast New Britain, L.L.C.
               2901 Butterfield Road
               Oak Brook, Illinois 60523
               Attention: Roberta Matlin, Vice President

               with a copy concurrently to:

               The Inland Real Estate Group, Inc.
               2901 Butterfield Road
               Oak Brook, Illinois 60523
               Attention: Robert H. Baum, Esq., General Counsel

               Unless otherwise specified, notices shall be deemed given as
follows: (i) if delivered personally, when delivered, (ii) if delivered by
nationally recognized overnight courier delivery service, on the day following
the day such material is sent, or (iii) if delivered by certified mail, on the
third day after the same is deposited with the United States Postal Service as
provided above.

               48.    NON-WAIVER. The failure of Mortgagee to insist upon strict
performance of any term hereof shall not be deemed to be a waiver of any term of
this Mortgage. Mortgagor shall not be relieved of Mortgagor's obligations
hereunder by reason of (a) failure of Mortgagee to comply with any request of
Mortgagor or any Guarantor to take any action to foreclose this Mortgage or
otherwise enforce any of the provisions hereof or of the Note, any Guaranty or
the other Loan Documents, (b) the release, regardless of consideration, of the
whole or any part of the Mortgaged Property, or of any person liable for the
Indebtedness or portion thereof or (c) any agreement or stipulation by Mortgagee
extending the time of payment or otherwise modifying or supplementing the terms
of the Note, any Guaranty, this Mortgage or the other Loan Documents. Mortgagee
may resort for the payment of the Indebtedness to any other security held by
Mortgagee in such order and manner as Mortgagee, in its discretion, may elect.
Mortgagee may take action to recover the Indebtedness, or any portion thereof,
or to enforce any covenant hereof without prejudice to the right of Mortgagee
thereafter to foreclose this Mortgage. The rights of Mortgagee under this
Mortgage shall be separate, distinct and cumulative and none shall be given
effect to the exclusion of the others. No act of Mortgagee shall be construed as
an election to proceed under any one provision herein to the exclusion of any
other provision. Mortgagee shall not be limited exclusively to the rights and
remedies herein stated but shall be entitled to every right and remedy now or
hereafter afforded by law.

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                                                                Loan No. 6518217

               49.    JOINT AND SEVERAL LIABILITY. If there is more than one
party comprising Mortgagor, then the obligations and liabilities of each party
under this Mortgage shall be joint and several.

               50.    SEVERABILITY. If any term, covenant or condition of the
Note, any Guaranty or this Mortgage is held to be invalid, illegal or
unenforceable in any respect, the Note, any Guaranty and this Mortgage shall be
construed without such provision.

               51.    DUPLICATE ORIGINALS. This Mortgage may be executed in any
number of duplicate originals and each such duplicate original shall be deemed
to constitute but one and the same instrument.

               52.    INDEMNITY AND MORTGAGEE'S COSTS. Mortgagor agrees to pay
all costs, including, without limitation, reasonable attorneys' fees and
expenses, incurred by Mortgagee in enforcing the terms hereof and/or the terms
of any of the other Loan Documents or the Note or any Guaranty, whether or not
suit is filed and waives to the full extent permitted by law all right to plead
any statute of limitations as a defense to any action hereunder. Mortgagor
agrees to indemnify and hold Mortgagee harmless from any and all liability,
loss, damage or expense (including, without limitation, attorneys' fees and
disbursements) that Mortgagee incurs hereunder or in connection with the
enforcement of any of its rights or remedies hereunder, any action taken by
Mortgagee hereunder, or by reason or in defense of any and all claims and
demands whatsoever that are asserted against Mortgagee arising out of the
Mortgaged Property; and should Mortgagee incur any such liability, loss, damage
or expense, the amount thereof with interest thereon at the Default Rate shall
be payable by Mortgagor immediately without demand, shall be secured by this
Mortgage, and shall be a part of the Indebtedness.

               53.    CERTAIN DEFINITIONS. Unless the context clearly indicates
a contrary intent or unless otherwise specifically provided herein, words used
in this Mortgage shall be used interchangeably in singular or plural form. The
word "MORTGAGOR" shall mean Mortgagor and/or any subsequent owner or owners of
the Mortgaged Property or any part thereof or interest therein. The word
"MORTGAGEE" shall mean Mortgagee or any subsequent holder of the Note. The word
"GUARANTY" shall mean any Guaranty of Payment, Guaranty of Completion, Guaranty
of Collection, Environmental Indemnity or any other Guaranty or Indemnity given
at any time to or for the benefit of Mortgagee in connection with the Loan. The
word "GUARANTOR" shall mean any person giving or making any Guaranty. The word
"NOTE" shall mean the Note or any other evidence of indebtedness secured by this
Mortgage. The words "LOAN DOCUMENTS" shall mean the Note, this Mortgage, the
loan agreement, if any, between Mortgagor and Mortgagee, the security agreement,
if any, between Mortgagor and Mortgagee, the assignment of leases and rents, if
any, made by Mortgagor to Mortgagee, any reserve agreements between Mortgagor
and Mortgagee, any escrow agreements between Mortgagor and Mortgagee, the
assignment of contracts, if any, made by Mortgagor to Mortgagee, all Guaranties,
if any, made to Mortgagee, any other Mortgage or deed of trust securing the Note
and any other agreement, instrument, affidavit or document executed by
Mortgagor, any Guarantor or any indemnitor and delivered to Mortgagee in
connection with the Loan. The word "PERSON" shall include an individual,
corporation, partnership, trust, unincorporated association, government,
governmental authority or other entity. The words "MORTGAGED PROPERTY" shall
include any portion of the Mortgaged Property or interest therein. Whenever the
context may require, any pronouns used herein shall

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                                                                Loan No. 6518217

include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural and vice versa.

               54.    NO ORAL CHANGE. This Mortgage, and any provisions hereof,
may not be modified, amended, waived, extended, changed, discharged or
terminated orally or by any act or failure to act on the part of Mortgagor or
any one Mortgagor or Mortgagee, but only by an agreement in writing signed by
the party against whom enforcement of any modification, amendment, waiver,
extension, change, discharge or termination is sought.

               55.    NO FOREIGN PERSON. Mortgagor is not a "foreign person"
within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986,
as amended and the related Treasury Department Regulations, including temporary
regulations.

               56.    SEPARATE TAX LOT. The Mortgaged Property is assessed for
real estate tax purposes as one or more wholly independent tax lot or lots,
separate from any adjoining land or improvements not constituting a part of such
lot or lots, and no other land or improvements is assessed and taxed together
with the Mortgaged Property or any portion thereof.

               57.    RIGHT TO RELEASE ANY PORTION OF THE MORTGAGED PROPERTY.
Mortgagee may release any portion of the Mortgaged Property for such
consideration as Mortgagee may require without, as to the remainder of the
Mortgaged Property, in any way impairing or affecting the lien or priority of
this Mortgage, or improving the position of any subordinate lienholder with
respect thereto, except to the extent that the obligations hereunder shall have
been reduced by the actual monetary consideration, if any, received by Mortgagee
for such release, and may accept by assignment, pledge or otherwise any other
property in place thereof as Mortgagee may require without being accountable for
so doing to any other lienholder. This Mortgage shall continue as a lien and
security interest in the remaining portion of the Mortgaged Property.

               58.    SUBROGATION. The Mortgagee shall be subrogated for further
security to the lien, although released of record, of any and all encumbrances
paid out of the proceeds of the Loan secured by this Mortgage.

               59.    ADMINISTRATIVE FEES. Mortgagee may charge reasonable
administrative fees and be reimbursed for all costs and expenses, including
reasonable attorneys' fees and disbursements, associated with reviewing and
processing post-closing requests of Mortgagor.

               60.    DISCLOSURE. Mortgagor represents and warrants that (a) it
has fully disclosed to Mortgagee all facts material to the Mortgaged Property
and the operation and tenants thereof, the Mortgagor, the Mortgagor's business
operations, any guarantor of Non-Recourse Carveout Obligations, any indemnitor
of environmental liabilities, and any other Guarantor and any principal of any
of them and the background, creditworthiness, financial condition and business
operations of each, (b) to Mortgagor's best knowledge, all material information
submitted in connection with this Loan is true, correct and complete, (c) to
Mortgagor's best knowledge, the financial and operating statements and other
accounting information submitted in connection with the Loan are true, correct,
complete, and fairly present the financial condition of the Mortgagor,
Guarantors and Indemnitors and their respective principals and have been
prepared

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                                                                Loan No. 6518217

consistent with proper accounting standards, and (d) there is no litigation,
action, claim, or other proceeding, pending or threatened which might, in any
way, materially and/or adversely affect the Applicant, Mortgagor, any Guarantor,
any Indemnitor or the principals of any of them, or the Mortgaged Property,
Mortgagee's lien thereon, or the financial condition of the Mortgaged Property
or any of the aforementioned persons; and a misrepresentation or breach of any
representation, warranty or covenant shall be an Event of Default under the Loan
Documents.

               61.    HEADINGS, ETC.. The headings and captions of various
paragraphs of this Mortgage are for convenience of reference only and are not to
be construed as defining or limiting, in any way, the scope or intent of the
provisions hereof.

               62.    ADDRESS OF REAL PROPERTY. The street address of the Real
Property is as follows: 1309 Corbin Street, New Britain, Connecticut.

               63.    INTENTIONALLY DELETED.

               64.    PUBLICITY. Mortgagor agrees that Mortgagee, at its
expense, may publicize the financing of the Mortgaged Property in trade and
similar publications.

               65.    RELATIONSHIP. The relationship of Mortgagee to Mortgagor
under this Mortgage is strictly and solely that of lender and borrower and
nothing contained in this Mortgage or any other Loan Document is intended to
create, or shall in any event or under any circumstance be construed to create,
a partnership, joint venture, tenancy-in-common, joint tenancy or other
relationship of any nature whatsoever between Mortgagee and Mortgagor other than
that of lender and borrower.

               66.    HOMESTEAD. Mortgagor hereby waives and renounces all
homestead and exemption rights provided by the constitution and the laws of the
United States and of any state, in and to the Land as against the collection of
the Indebtedness, or any part hereof.

               67.    NO THIRD PARTY BENEFICIARIES. Nothing contained herein is
intended or shall be deemed to create or confer any rights upon any third person
not a party hereto, whether as a third-party beneficiary or otherwise, except as
expressly provided herein.

               68.    COMPLIANCE WITH REGULATION U. Mortgagor represents,
warrants and covenants that no part of the proceeds of the Loan will be used for
the purpose (whether immediate, incidental or ultimate) of buying or carrying
any margin stock within the meaning of Regulation U (12 CFR part 221) of the
Board of Governors of the Federal Reserve System of the United States or for the
purpose of reducing or retiring any indebtedness which was originally incurred
for any such purpose, or for any other purpose which might constitute this Loan
a "purpose credit" within the meaning of such Regulation U.

               69.    ENTIRE AGREEMENT. This Mortgage, the Note and the other
Loan Documents constitute the entire agreement among Mortgagor and Mortgagee
with respect to the subject matter hereof and all understandings, oral
representations and agreements heretofore or simultaneously had among the
parties are merged in, and are contained in, such documents and instruments.

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                                                                Loan No. 6518217

               70.    SERVICER. Mortgagee may from time to time appoint a
servicer (the "SERVICER") to administer the Loan, which Servicer shall have the
power and authority to exercise all of the rights and remedies of Mortgagee and
to act as agent of Mortgagee hereunder.

               71.    GOVERNING LAW; CONSENT TO JURISDICTION. THIS MORTGAGE
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE IN
WHICH THE MORTGAGED PROPERTY IS LOCATED WITHOUT REGARD TO CONFLICT OF LAW
PROVISIONS THEREOF. EACH MORTGAGOR, ENDORSER AND GUARANTOR HEREBY SUBMITS TO
PERSONAL JURISDICTION IN SAID STATE AND THE FEDERAL COURTS OF THE UNITED STATES
OF AMERICA LOCATED IN SAID STATE (AND ANY APPELLATE COURTS TAKING APPEALS
THEREFROM) FOR THE ENFORCEMENT OF SUCH MORTGAGOR'S, ENDORSER'S OR GUARANTOR'S
OBLIGATIONS HEREUNDER, UNDER THE NOTE, THE GUARANTY AND THE OTHER LOAN
DOCUMENTS, AND WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAW OF ANY OTHER
STATE TO OBJECT TO JURISDICTION WITHIN SUCH STATE FOR THE PURPOSES OF SUCH
ACTION, SUIT, PROCEEDING OR LITIGATION TO ENFORCE SUCH OBLIGATIONS OF SUCH
MORTGAGOR, ENDORSER OR GUARANTOR. EACH MORTGAGOR, ENDORSER AND GUARANTOR HEREBY
WAIVES AND AGREES NOT TO ASSERT, AS A DEFENSE IN ANY ACTION, SUIT OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS MORTGAGE, THE NOTE, ANY GUARANTY OR ANY OTHER
LOAN DOCUMENT, (A) THAT IT IS NOT SUBJECT TO SUCH JURISDICTION OR THAT SUCH
ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN THOSE
COURTS OR THAT THIS MORTGAGE, THE NOTE, THE GUARANTY AND/OR ANY OF THE OTHER
LOAN DOCUMENTS MAY NOT BE ENFORCED IN OR BY THOSE COURTS OR THAT IT IS EXEMPT OR
IMMUNE FROM EXECUTION, (B) THAT THE ACTION, SUIT OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM OR (C) THAT THE VENUE OF THE ACTION, SUIT OR PROCEEDING IS
IMPROPER. IN THE EVENT ANY SUCH ACTION, SUIT, PROCEEDING OR LITIGATION IS
COMMENCED, MORTGAGOR, ENDORSER AND GUARANTOR AGREE THAT SERVICE OF PROCESS MAY
BE MADE, AND PERSONAL JURISDICTION OVER SUCH MORTGAGOR, ENDORSER OR GUARANTOR
OBTAINED, BY SERVICE OF A COPY OF THE SUMMONS, COMPLAINT AND OTHER PLEADINGS
REQUIRED TO COMMENCE SUCH LITIGATION UPON SUCH MORTGAGOR, ENDORSER OR GUARANTOR
AT 2901 BUTTERFIELD ROAD, OAK BROOK, ILLINOIS 60523.

               72.    SPECIAL STATE PROVISIONS.

               (a)    In the event of any inconsistencies between the other
paragraphs of this Mortgage and this Paragraph 72, the terms and conditions of
this Paragraph 72 shall control and be binding.

               (b)    The term "Environmental Law" shall be deemed to include,
without limitation, the following statutes: any laws of the State of Connecticut
or ordinances of the City of Shelton pertaining to protection of the environment
or to any Polluting Substance, including, but not limited to Connecticut General
Statutes Title 22a.

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                                                                Loan No. 6518217

               (c)    Mortgagor shall not cause or permit the Mortgaged Property
to be or become an "establishment" under Connecticut General Statutes Section
22a-134 et seq.

               (d)    MORTGAGOR ACKNOWLEDGES, REPRESENTS AND WARRANTS THAT THE
LOAN EVIDENCED BY THE NOTE IS FOR COMMERCIAL PURPOSES. MORTGAGOR FURTHER
ACKNOWLEDGES, REPRESENTS AND WARRANTS THAT IT IS ENGAGED EXCLUSIVELY IN
COMMERCIAL PURSUITS AND THAT THE PROCEEDS OF THE NOTE ARE TO BE UTILIZED IN THE
BUSINESS ACTIVITIES OF MORTGAGOR AND WILL NOT BE UTILIZED FOR CONSUMER PURPOSES.

               (e)    IN CONNECTION WITH ANY ACTION OR PROCEEDING RELATING TO
THE NOTE, THIS MORTGAGE, OR THE OTHER DOCUMENTS OR TRANSACTIONS EVIDENCED HEREBY
OR THEREBY, (i) MORTGAGOR WAIVES ANY RIGHT TO NOTICE AND HEARING UNDER CHAPTER
903(a) OF THE CONNECTICUT GENERAL STATUTES, AS NOW OR HEREAFTER AMENDED, OR ANY
SUCCESSOR ACT THERETO, AND AUTHORIZES THE ATTORNEY OF MORTGAGEE TO ISSUE A WRIT
FOR THE PREJUDGMENT REMEDY WITHOUT COURT ORDER, AND (ii) MORTGAGOR WAIVES TRIAL
BY JURY IN ANY SUCH ACTION OR PROCEEDING AND AGREES THAT NO SUCH ACTION WITH
RESPECT TO WHICH A JURY TRIAL HAS BEEN WAIVED SHALL BE SOUGHT TO BE CONSOLIDATED
WITH ANY OTHER ACTION WITH RESPECT TO WHICH A JURY TRIAL CANNOT OR HAS NOT BEEN
WAIVED.

               (f)    In addition to any remedies set forth in Section 21 above,
Mortgagee shall have all rights at law or in equity under applicable law to
foreclose the Mortgage, including, without limitation, by strict foreclosure.
Further, Mortgagee shall have the power to sell the Mortgaged Property at public
or private sale as may hereafter be allowed under any applicable law. In the
event that any such law enacted after the date hereof requires that a mortgage
contain specific language in order for the holder thereof to have such power of
sale, this Mortgage shall be deemed modified to include such language.

               (g)    The condition of this Mortgage Deed is such that whereas
Mortgagor is indebted to Mortgagee in the sum of $18,150,000.00, as evidenced by
the Note of even date herewith in the face amount of said sum executed by
Mortgagor and delivered to Mortgagee, a copy of which Note is attached hereto as
EXHIBIT B and made a part hereof, and this Mortgage is made to secure the
payment of the principal and interest due under the Note and performance and
discharge of Mortgagor's obligations, covenants, and agreements under the Note
and the Loan Documents;

               Now, Therefore, if said Note shall be well and truly paid
according to its tenor and if all the terms, covenants, conditions and
agreements of Mortgagor herein contained shall be fully and faithfully
performed, observed and complied with, then this Mortgage shall be void, but
otherwise shall remain in full force and effect.

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                                                                Loan No. 6518217

          IN WITNESS WHEREOF, Mortgagor has duly executed and delivered this
Mortgage as of the day and year first above written.

WITNESSED BY:                 MORTGAGOR:

  /s/ JoAnne Schoeller        INLAND SOUTHEAST NEW BRITAIN, L.L.C.,
------------------------      a Delaware limited liability company
Name:  JoAnne Schoeller
      ------------------

                              By: Inland Western Retail Real Estate Trust, Inc.,
                                  a Maryland corporation, its sole member

                                  By:    /s/ Valerie Medina
                                      ------------------------------------------
                                  Its:     Asst. Secretary
                                      ------------------------------------------

    [SIGNATURE PAGE TO MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY
                                   AGREEMENT]

                                     - 52 -
<Page>

                                                                Loan No. 6518217

STATE OF___________________     )
                                ) SS.  _______________      January __, 2004
COUNTY OF___________________    )

     Personally appeared _____________________________, ______________________
of Inland Western Retail Real Estate Trust, Inc., a Maryland corporation, the
Sole Member of Inland Southeast New Britain, L.L.C., a Delaware limited
liability company, signer and sealer of the foregoing instrument, and
acknowledged the same to be his/her free act and deed as such ______________ and
the free act and deed of said ______________ and _____________________________,
before me.

                                      -------------------------------------
                                      Name:
                                      Commissioner of the Superior Court
                                      Notary Public
                                      My commission expires:
                                                            ---------------

                                     [SEAL]

 [ACKNOWLEDGEMENT PAGE TO MORTGAGE, ASSIGNMENT OF LEASES AND RENTS AND SECURITY
                                   AGREEMENT]

                                     - 53 -
<Page>

                                                                Loan No. 6518217

                                    EXHIBIT A

                               DESCRIPTION OF LAND

FIRST PIECE (665 West Main Street):

A certain piece or parcel of land, together with all buildings and improvements
thereon, located on Corbin Avenue and West Main Street, in the City of New
Britain, County of Hartford and State of Connecticut, and shown as "MONTOWESE
INDUSTRIAL PARK, INC. AREA = 576,895.08 S.F. OR AREA = 13.244 AC" on a survey
entitled "Property Boundary & Easement Plan Prepared for Montowese Industrial
Park, Inc. Laura-Howard Realty Co., Inc. Corbin Ave. & West Main St. New
Britain, CT Scale 1" = 50' December 27, 1999 Sheet: Plan 3 KJA Map #47-26",
revised to December 11, 2002, made by Kratzert, Jones & Assoc. Inc., Civil
Engineers-Land Surveyors-Site Planners-Building Engineers, 1755
Meriden-Waterbury Turnpike, Milldale, CT, which survey is filed in the Office of
the Town Clerk of the said Town of New Britain in Map Volume 26 at Page 68. Said
premises are more particularly bounded and described as follows:

Starting at the point of commencement, said point near the northeast corner of
the parcel herein described, and along the western boundary of land now or
formerly of The Stanley Works, and 213.71 feet north of land now or formerly of
Acme Steel; thence S 10 DEG. 59' 20" W, 213.71 feet to a point; thence N 79 DEG.
02' 47" W, 61.50 feet to a point; thence S 10 DEG. 48' 39" W, 288.17 feet to a
point; thence S 78 DEG. 46' 35" E, 71.50 feet to a point; thence S 09 DEG. 11'
13" W, 439.95 feet to a point; thence N 73 DEG. 51' 20" W, 142.13 feet to a
point; thence S 08 DEG. 28' 13" W, 230.00 feet to a point; thence N 73 DEG. 42'
17" W, 109.20 feet to a point; thence N 11 DEG. 01' 15" E, 238.20 feet to a
point; thence N 79 DEG. 11' 21" W, 94.01 feet to a point; thence N 10 DEG. 48'
38" E, 216.63 feet to a point; thence N 80 DEG. 50' 46" W, 382.34 feet to a
point; thence N 08 DEG. 30' 21" E, 193.71 feet to a point; thence along a curve
to the right having the following dimensions: a delta of 24 DEG. 45' 16", a
radius length of 470.00 feet and an arc length of 203.06 feet; thence N 33 DEG.
15' 34" E, 334.04 feet to a point; thence S 84 DEG. 48' 06" E, 186.63 feet to a
point; thence N 05 DEG. 11' 54" E, 50.08 feet to a point; thence N 33 DEG. 28'
27" E, 56.72 feet to a point; thence S 84 DEG. 37' 52" E, 262.33 feet to a
point; thence S 05 DEG. 11' 54" W, 148.79 feet to a point; thence S 85 DEG. 17'
26" E, 61.30 feet to a point, said point at the point and place of commencement.

Together with rights as set forth in a Reciprocal Easement Agreement by and
between Laura-Howard Realty Company, Inc. and Montowese Industrial Park, Inc.
dated February 28, 2000 and recorded in Volume 1342 at Page 645 of the New
Britain Land Records.

Together with rights as set forth in a Declaration of Easements, Covenants and
Agreements by and between Acme Packaging Corporation and N.B. Realty Corp., Inc.
dated February 5, 1999 and recorded in Volume 1297 at Page 44 of the New Britain
Land Records.

SECOND PIECE (687 West Main Street):

                                   Exhibit A-l
<Page>

                                                                Loan No. 6518217

A certain piece or parcel of land, together with all buildings and improvements
thereon, located on Corbin Avenue and West Main Street, in the City of New
Britain, County of Hartford and State of Connecticut, and shown as "LAURA-HOWARD
REALTY CO., INC. AREA = 179,954.82 S.F. OR AREA = 4.131 AC." on a survey
entitled "Property Boundary & Easement Plan Prepared for Montowese Industrial
Park, Inc., Laura-Howard Realty Co., Inc. Corbin Ave. & West Main St. New
Britain, CT Scale 1" = 50' December 27, 1999 Sheet: Plan 3", revised to December
11, 2002, made by Kratzert, Jones & Assoc. Inc., Civil Engineers-Land
Surveyors-Site Planners-Building Engineers, 1755 Meriden-Waterbury Turnpike,
Milldale, CT, which survey is filed as Map No. 15639 in the Office of the Town
Clerk of the said Town of New Britain. Said premises are more particularly
bounded and described as follows:

Starting at the point of commencement, said point being the southwest corner of
the parcel herein described along the northerly street line of West Main Street;
thence N 08 DEG. 30' 21" E, a distance of 400.00 feet to a point; thence S 80
DEG. 50' 46" E, a distance of 382.34 feet to a point; thence S 10 DEG. 48' 39"
W, a distance of 216.63 feet to a point; thence S 79 DEG. 11' 21" E, a distance
of 94.01 feet to a point; thence S 11 DEG. 01' 15" W, a distance of 238.20 feet
to a point; thence N 73 DEG. 42' 17" W, a distance of 161.35 feet to a point;
thence N 73 DEG. 42' 17" W, a distance of 300 feet to the point or place of
beginning.

Together with rights as set forth in a Reciprocal Easement Agreement by and
between Laura-Howard Realty Company, Inc. and Montowese Industrial Park, Inc.
dated February 28, 2000 and recorded in Volume 1342 at Page 645 of the New
Britain Land Records.

                                   Exhibit A-2
<Page>

                                                                Loan No. 6518217

                                    EXHIBIT B

                                  MORTGAGE NOTE

                                   Exhibit B-1<Page>

                                                                   Exhibit 10.35

                                                                Loan No. 6518217

                               GUARANTY AGREEMENT

     THIS GUARANTY AGREEMENT ("GUARANTY"), is entered into effective as of
January 1, 2004, by INLAND SOUTHEAST NEW BRITAIN, L.L.C., a Delaware limited
liability company, having a mailing address at 2901 Butterfield Road, Oak Brook,
Illinois 60523 ("GUARANTOR"), in favor of JOHN HANCOCK LIFE INSURANCE COMPANY, a
Massachusetts corporation ("LENDER"), and the subsequent owners and holders of
the herein below defined Note.

                                    RECITALS:

     A.   Inland Southeast New Britain, L.L.C., a Delaware limited liability
company ("BORROWER") has requested a loan (the "LOAN") from Lender in the amount
of $18,150,000.00 to be evidenced by the Mortgage Note of even date herewith
executed by Borrower, payable to Lender in the original principal sum of
$18,150,000.00 (the "NOTE"), and secured by, INTER ALIA, the Mortgage,
Assignment of Leases and Rents and Security Agreement of even date herewith
executed by Borrower in favor of Lender covering certain property in the City of
New Britain, County of Hartford, State of Connecticut (the "MORTGAGE");

     B.   Section 19 of the Note sets forth certain amounts, obligations and
other liabilities for which Borrower is fully liable to Lender (the
"NON-RECOURSE CARVEOUT OBLIGATIONS"), notwithstanding limitations on Borrower's
liability pursuant to said Section 19 of the Note; and

     C.   As a condition to making the Loan, Lender has required that Borrower
as Guarantor expressly and explicitly and separately guarantee the payment of
the Non-Recourse Carveout Obligations and performance of the obligations set
forth in Section 1 below (the "GUARANTEED OBLIGATIONS").

                                   AGREEMENT:

     NOW, THEREFORE, as a material inducement to Lender to agree to make the
Loan to Borrower, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor hereby does irrevocably
and unconditionally warrant and represent unto and covenant with Lender as
follows:

     1.   GUARANTY. Guarantor hereby (a) guarantees unto Lender the full and
timely payment of the amounts due, or to become due, to Lender under the
Non-Recourse Carveout Obligations and (b) agrees with Lender to pay to Lender
(i) the amounts due under the Non-Recourse Carveout Obligations within five (5)
days from the date Lender notifies Guarantor of Borrower's failure to pay the
same, if and when the same becomes due, and at the place specified in the Note
for payment and (ii) Lender's reasonable attorneys' fees and all court costs
incurred by Lender in enforcing or protecting any of Lender's rights, remedies
or recourses hereunder.

<Page>

                                                                Loan No. 6518217

Guarantor is not hereby guaranteeing payment of any portion of the indebtedness
or performance of any portion of the obligations under the documents evidencing,
securing, guaranteeing or executed in connection with the Loan (the "LOAN
DOCUMENTS"), other than the Non-Recourse Carveout Obligations.

     2.   GUARANTOR'S REPRESENTATIONS AND WARRANTIES. Guarantor hereby warrants
and represents unto Lender as follows:

          (a)  that this Guaranty constitutes the legal, valid and binding
obligation of Guarantor and is fully enforceable against Guarantor in accordance
with its terms;

          (b)  Guarantor is solvent and the execution of this Guaranty does not
render Guarantor insolvent. Any and all financial statements, balance sheets,
net worth statements and other financial data which have heretofore been
furnished to Lender with respect to Guarantor fairly and accurately present the
financial condition of Guarantor as of the date they were furnished to Lender
and, since that date, there has been no material adverse change in the financial
condition of Guarantor;

          (c)  that there are no legal proceedings or material claims or demands
pending against or, to the best of Guarantor's knowledge threatened against,
Guarantor or any of its assets;

          (d)  that the execution and delivery of this Guaranty and the
assumption of liability hereunder have been in all respects authorized and
approved by Guarantor; Guarantor has full authority and power to execute this
Guaranty and to perform its obligations hereunder; and

          (e)  that neither the execution nor the delivery of this Guaranty nor
the fulfillment and compliance with the provisions hereof will conflict with,
result in a breach of, constitute a default under or result in the creation of
any lien, charge, or encumbrance upon any property or assets of Guarantor under
any agreement or instrument to which Guarantor is now a party or by which it may
be bound.

     3.   WAIVER. Guarantor hereby waives (a) for itself as Guarantor but not
for itself in its capacity as Borrower all notices of acceptance hereof,
protest, demand and dishonor, presentment, notice of nonpayment, notice of
intention to accelerate maturity, notice of acceleration of maturity and all
notices and demands of any kind now or hereafter provided for by any statute or
rule of law other than the five (5) day notice referred to in Paragraph 1 above,
(b) any and all requirements that Lender institute any action or proceeding, or
exhaust or attempt to enforce any or all of Lender's right, remedies or
recourses against Borrower or anyone else or in respect of any mortgaged
property or collateral covered by any Loan Documents, or join Borrower or any
other persons liable on the Non-Recourse Carveout Obligations in any action to
enforce this Guaranty as a condition precedent to bringing an action against
Guarantor upon this Guaranty, it being expressly agreed that the liability of
Guarantor hereunder shall be primary and not secondary, (c) any defense arising
by reason of any disability, insolvency, lack of authority

                                      - 2 -
<Page>

                                                                Loan No. 6518217

or power, death, insanity, minority, dissolution or any other defense of
Borrower, or any other surety, co-maker, endorser or guarantor of the
Non-Recourse Carveout Obligations (even though rendering same void,
unenforceable or otherwise uncollectible), it being agreed that Guarantor shall
remain liable hereon regardless of whether Borrower or any other such person be
found not liable thereon for any reason, (d) all suretyship defenses of every
kind and nature and (e) any claim Guarantor might otherwise have against Lender
by virtue of Lender's invocation of any right, remedy or recourse permitted it
hereunder or under the Loan Documents. This is a guaranty of payment and not a
guaranty of collection.

     4.   SUBSEQUENT ACTS. Guarantor hereby agrees with Lender that (a) the
payments called for and provisions contained in the Loan Documents, including
specifically (but without limitation) the Note, may be renewed, extended,
rearranged, modified, released or canceled, (b) all or any part of any mortgaged
property and collateral for the indebtedness may be released from, and any new
or additional security may be added to, the lien and security interest of the
Loan Documents, (c) any additional parties who may become personally liable for
repayment of the Note may hereafter be released from their liability hereunder
and thereon and (d) Lender may take, or delay in taking or refuse to take, any
and all action with reference to the Note and the other Loan Documents
(regardless of whether same might vary the risk or alter the rights, remedies or
recourses of Guarantor), including specifically (but without limitation) the
settlement or compromise of any amount allegedly due thereunder, all without
notice or consideration to or the consent of Guarantor, and no such acts shall
in any way release, diminish or affect the absolute nature of Guarantor's
obligations and liabilities hereunder. It is the intent of Guarantor and Lender
that such obligations and liabilities hereunder are primary, absolute and
unconditional under any and all circumstances and that, until the Non-Recourse
Carveout Obligations are fully and finally satisfied, such obligations and
liabilities shall not be discharged or released, in whole or in part, by any act
or occurrence which, but for this Paragraph 4, might be deemed a legal or
equitable discharge or release of Guarantor.

     5.   REMEDIES CUMULATIVE. Guarantor hereby agrees with Lender that all
rights, remedies and recourses afforded to Lender by reason of this Guaranty or
otherwise are (a) separate and cumulative and may be pursued separately,
successively or concurrently, as occasion therefor shall arise, and (b)
non-exclusive and shall in no way limit or prejudice any other legal or
equitable right, remedy or recourse which Lender may have.

     6.   SUBORDINATION AND NO SUBROGATION. If, for any reason whatsoever,
Borrower now is or hereafter becomes indebted to Guarantor, such indebtedness
and all interest thereon, shall, at all times, be subordinate in all respects to
the Loan Documents, and Guarantor shall not be entitled to enforce or receive
payment thereof until the Non-Recourse Carveout Obligations have been fully
satisfied. Notwithstanding anything to the contrary contained in this Guaranty
or any payments made by Guarantor hereunder, Guarantor shall not have any right
of subrogation in or under the Loan Documents or to participate in any way
therein or in any right, title or interest in and to any mortgaged property or
any collateral for the Loan, all such rights of subrogation and participation,
together with any other contractual, statutory or common law right which
Guarantor may have to be reimbursed for any payments Guarantor may make to
Lender

                                      - 3 -
<Page>

                                                                Loan No. 6518217

pursuant to this Guaranty, being hereby expressly waived and released until the
Loan is paid in full.

     7.   LAW GOVERNING AND SEVERABILITY. This Guaranty shall be governed by and
construed in accordance with the laws of the State of Connecticut and is
intended to be performed in accordance with, and only to the extent permitted
by, such laws. If any provision of this Guaranty or the application thereof to
any person or circumstance, for any reason and to any extent, shall be invalid
or unenforceable, neither the remainder of this Guaranty nor the application of
such provision to any other persons or circumstances shall be affected thereby,
but rather the same shall be enforced to the greatest extent permitted by law.

     8.   SUCCESSORS AND ASSIGNS. This Guaranty and all the terms, provisions
and conditions hereof shall be binding upon Guarantor and the Guarantor's heirs,
legal representatives, successors and assigns and shall inure to the benefit of
Lender, its successors and assigns and all subsequent holders of the Note.

     9.   PARAGRAPH HEADINGS. The paragraph headings inserted in this Guaranty
have been included for convenience only and are not intended, and shall not be
construed, to limit or define in any way the substance of any paragraph
contained herein.

     10.  EFFECT OF BANKRUPTCY. This Guaranty shall continue to be effective or
reinstated, as the case may be, if at any time payment to Lender of all or any
part of the Non-Recourse Carveout Obligations is rescinded or must otherwise be
restored or refunded by Lender pursuant to any insolvency, bankruptcy,
reorganization, receivership or other debtor relief proceeding involving
Borrower. In the event that Lender must rescind or restore any payment received
by Lender in satisfaction of the Non-Recourse Carveout Obligations, as set forth
herein, any prior release or discharge of the terms of this Guaranty given to
Guarantor by Lender shall be without effect and this Guaranty shall remain in
full force and effect.

     11.  NOTICES. All notices hereunder shall be given at the following
address:

     If to Guarantor: Inland Southeast New Britain, L.L.C., 2901 Butterfield
Road, Oak Brook, Illinois 60523;

     If to Lender: John Hancock Life Insurance Company, John Hancock Tower, 200
Clarendon Street, T-56, Boston, Massachusetts 02117, Re: Loan No. 6518217.

     All notices given hereunder shall be in writing and shall be considered
properly given if delivered either personally to such other party, or sent by
nationally recognized overnight courier delivery service or by certified mail of
the United States Postal Service, postage prepaid return receipt requested,
addressed to the other party as set forth above (or to such other address or
person as either party entitled to notice may by notice to the other party
specify). Unless otherwise specified, notices shall be deemed given as follows:
(i) if delivered personally, when delivered, (ii) if delivered by nationally
recognized overnight courier delivery service, on the day

                                      - 4 -
<Page>

                                                                Loan No. 6518217

following the day such material is sent or (iii) if delivered by certified mail,
on the third day after the same is deposited in the United States Postal Service
as provided above.

     12.  BENEFIT. Guarantor warrants and represents that Guarantor has
received, or will receive, direct or indirect benefit from the execution and
delivery of this Guaranty.

     13.  NO REPRESENTATIONS BY LENDER. Neither Lender nor anyone acting on
behalf of Lender has made any representation, warranty or statement to Guarantor
to induce Guarantor to execute and deliver this Guaranty.

     14.  APPLICATION OF FORECLOSURE PROCEEDS. In the event of any foreclosure
sales of the mortgaged property and collateral covered by the Loan Documents,
the proceeds of such sales shall be applied first to the discharge of that
portion of the indebtedness then remaining unpaid as to which Guarantor is not
fully personally liable pursuant to this Guaranty, it being the express
intention of the parties that the application of the proceeds of such
foreclosure sales shall be in such a manner as not to extinguish or reduce
Guarantor's personal liability hereunder until all of the indebtedness as to
which Guarantor is not personally liable hereunder has been paid in full.
Nothing contained in this Paragraph 14 shall be construed to require that Lender
foreclose the liens and security interests created in the Loan Documents as a
condition precedent to bringing an action against Guarantor upon this Guaranty,
or as an agreement that Guarantor's liability is limited to any deficiency
remaining after such a foreclosure.

     15.  JOINT AND SEVERAL LIABILITY. If more than one person is included in
the definition of Guarantor, the liability of all such persons hereunder shall
be joint and several.

     16.  SPECIAL STATE PROVISIONS. IN CONNECTION WITH ANY ACTION OR PROCEEDING
RELATING TO THIS GUARANTY, (i) GUARANTOR WAIVES ANY RIGHT TO NOTICE AND HEARING
UNDER CHAPTER 903(a) OF THE CONNECTICUT GENERAL STATUTES, AS NOW OR HEREAFTER
AMENDED, OR ANY SUCCESSOR ACT THERETO, AND AUTHORIZES THE ATTORNEY OF LENDER TO
ISSUE A WRIT FOR THE PREJUDGMENT REMEDY WITHOUT COURT ORDER, AND (ii) GUARANTOR
WAIVES TRIAL BY JURY IN ANY SUCH ACTION OR PROCEEDING AND AGREES THAT NO SUCH
ACTION WITH RESPECT TO WHICH A JURY TRIAL HAS BEEN WAIVED SHALL BE SOUGHT TO BE
CONSOLIDATED WITH ANY OTHER ACTION WITH RESPECT TO WHICH A JURY TRIAL CANNOT OR
HAS NOT BEEN WAIVED.

                                      - 5 -
<Page>

                                                                Loan No. 6518217

     EXECUTED effective as of the date first above written.

WITNESSED BY:                 MAKER:

--------------------------    INLAND SOUTHEAST NEW BRITAIN, L.L.C.,
Name:                         a Delaware limited liability company
      --------------------

                              By: Inland Western Retail Real Estate Trust, Inc.,
                                  a Maryland corporation its sole member

                                  By:     /s/ Valerie Medina
                                      ------------------------------------------
                                  Its:    Asst. Secretary
                                      ------------------------------------------

                          [SIGNATURE PAGE TO GUARANTY]

                                      - 6 -
<Page>

                                                                Loan No. 6518217

STATE OF___________________      )
                                 ) SS.   _______________     January _, 2004
COUNTY OF____________________    )

     Personally appeared_____________________________, ______________________ of
Inland Western Retail Real Estate Trust, Inc., a Maryland corporation, the Sole
Member of Inland Southeast New Britain, L.L.C., a Delaware limited liability
company, signer and sealer of the foregoing instrument, and acknowledged the
same to be his/her free act and deed as such __________ and the free act and
deed of said ______________ and _____________________________, before me.

                                      --------------------------------------
                                      Name:
                                      Commissioner of the Superior Court
                                      Notary Public
                                      My commission expires:
                                                            ----------------

                                     [SEAL]

                       [ACKNOWLEDGEMENT PAGE TO GUARANTY]

                                      - 7 -

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