Document:

GTJ REIT, INC.,
                            GREEN ACQUISITION, INC.,
                            TRIBORO ACQUISITION, INC,
                           JAMAICA ACQUISITION, INC.,
                            165-25 147TH AVENUE, LLC,
                      49-19 ROCKAWAY BEACH BOULEVARD, LLC,
                           85-01 24TH AVENUE, LLC, AND
                        114-15 GUY BREWER BOULEVARD, LLC

                              SENIOR MORTGAGE NOTE

No. MR-1                                                           July 2, 2007

$200,000.00                                                     PPN:  36238@ AA4

     FOR VALUE RECEIVED,  each of GTJ REIT,  INC., a Maryland  corporation  (the
"Parent"), GREEN ACQUISITION, INC., a New York corporation, TRIBORO ACQUISITION,
INC, a New York corporation,  JAMAICA ACQUISITION, INC., a New York corporation,
165-25 147TH AVENUE, LLC, a New York limited liability company (the "First Green
Operating Subsidiary"),  49-19 ROCKAWAY BEACH BOULEVARD, LLC, a New York limited
liability company (the "Second Green Operating Subsidiary"),  85-01 24TH AVENUE,
LLC, a New York limited liability company (the "Triboro Operating  Subsidiary"),
and 114-15 GUY BREWER BOULEVARD,  LLC, a New York limited liability company (the
"Jamaica Operating Subsidiary")  (collectively,  herein called the "Borrowers"),
jointly  and  severally  hereby  promises  to pay to ING USA  ANNUITY  AND  LIFE
INSURANCE  COMPANY,  or  registered  assigns,  the  principal sum of TWO HUNDRED
THOUSAND  DOLLARS (or so much  thereof as shall remain  outstanding)  on July 1,
2010,  subject  to  extension  at the  option of the  Borrowers  as set forth in
Section 7 below (the "Maturity Date"), with interest (computed on the basis of a
360-day year of twelve 30-day months),  payable monthly on the first day of each
calendar month  commencing on August 1, 2007 and at maturity,  (i) on the unpaid
balance at the rate of 6.59% per annum (the  "Interest  Rate"),  and (ii) to the
extent permitted by law, on any overdue payment of such interest and, during the
continuance of an Event of Default (as defined below),  on such unpaid principal
balance and on any overdue payment of any Make-Whole  Amount (as defined below),
at a rate per annum from time to time equal to the  Default  Rate.  The  Default
Rate shall mean the lesser of (a) the  Interest  Rate plus two percent  (2%) and
(b) the highest rate permitted by applicable law.

     1. Manner of Payment.  Payment of  principal,  interest and any  Make-Whole
Amount with respect to this  Mortgage Note are to be made in lawful money of the
United States of America.

     2. Senior  Mortgage  Notes.  This Mortgage Note is one of a class of senior
notes  (herein  called  the  "Mortgage  Notes")  issued  pursuant  to  the  Loan
Agreement,  dated as of June 30, 2007 (as from time to time amended, restated or
otherwise  modified,  the  "Loan  Agreement"),  among  the  Borrowers,  and  the
respective Lenders named therein, and is entitled to the benefits thereof and of
a certain Mortgage and Security Agreement (the "Mortgage") of even date herewith
made by the  First  Green  Operating  Subsidiary,  the  Second  Green  Operating
Subsidiary,   the  Triboro  Operating   Subsidiary  and  the  Jamaica  Operating
Subsidiary  encumbering  such  parties'  respective  fee simple  interest in the
properties  known as (i)  165-25  147th  Avenue,  Jamaica,  Queens,  (ii)  49-19
Rockaway Beach  Boulevard,  Averne,  Queens,  New York, (iii) 85-01 24th Avenue,
East Elmhurst, New York and (iv) 114-15 Guy Brewer Boulevard,  Jamaica,  Queens,
New York.

<PAGE>

     3.  Registered  Mortgage Note. This Mortgage Note is a registered note and,
as provided in the Loan  Agreement,  upon  surrender of this  Mortgage  Note for
registration of transfer,  duly endorsed, or accompanied by a written instrument
of transfer  duly  executed,  by the  registered  holder hereof or such holder's
attorney duly  authorized in writing,  a new Mortgage Note for a like  principal
amount will be issued to, and registered in the name of, the  transferee.  Prior
to due  presentment for  registration  of transfer,  the Borrowers may treat the
person in whose name this  Mortgage  Note is  registered as the owner hereof for
the purpose of receiving  payment and for all other purposes,  and the Borrowers
will not be affected by any notice to the contrary.

     4.  Optional  Prepayment.   This  Mortgage  Note  is  subject  to  optional
prepayment at the times and on the terms specified below:

     (a) Provided that there are no  Non-Mortgage  Loans (as defined in the Loan
Agreement) outstanding or Commitments (as defined in the Loan Agreement) to make
Non-Mortgage  Loans  available from the Lenders to the Borrowers,  the Borrowers
may, at their  option,  upon notice as provided in  subsection  (b),  prepay the
outstanding  principal of this Mortgage Note, and all other notes evidencing the
Mortgage  Loan (as defined in the Loan  Agreement),  in whole but not in part at
any time on or after the date that is 30 months after the date hereof,  together
with  all  accrued  interest  thereon  and  any  applicable  Make-Whole  Amount.
Notwithstanding  the  above-described  lock-out  period,  if Lenders  permit the
Borrowers  to prepay  the  Non-Mortgage  Loans  prior to the  expiration  of the
lock-out  period,  the  Borrowers  shall also be entitled to prepay the Mortgage
Loan,  together with all accrued interest thereon and any applicable  Make-Whole
Amount.

     (b) The Parent will give each Lender  written  notice of its  intention  to
make the optional  prepayment  hereunder  not less than five  Business  Days (as
defined in the Loan  Agreement)  and in any event not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify (i) such date
(which shall be a Business  Day),  (ii) the  aggregate  principal  amount of the
Mortgage  Loan to be  prepaid on such date,  (iii) the  principal  amount of the
Mortgage  Loan held by each  Lender to be prepaid,  and (iv) the  interest to be
paid on the  prepayment  date  with  respect  to such  principal  amounts  being
prepaid,  accompanied by a certificate of a Senior Financial Officer (as defined
in the Loan Agreement) as to the estimated  Make-Whole  Amount due in connection
with such prepayment  (calculated as if the date of such notice were the date of
the  prepayment),  setting forth the details of such  computation.  Two Business
Days prior to any such prepayment of the Mortgage Loan, the Parent shall deliver
to each  Lender a  certificate  of a Senior  Financial  Officer  specifying  the
calculation of such Make-Whole Amount as of the specified prepayment date.

     (c) The  principal  amount of the Mortgage Loan shall mature and become due
and payable on the date fixed for such  prepayment,  together  with  interest on
such principal amount accrued to such date and the applicable Make-Whole Amount,
if any. From and after such date,  unless the  Borrowers  shall fail to pay such
principal  amount when so due and payable,  on the date so fixed for prepayment,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.

     (d) The Borrowers will not and will not permit any Affiliate (as defined in
the Loan Agreement) to prepay, purchase,  redeem or otherwise acquire,  directly
or  indirectly,  the Mortgage  Loan except upon the payment or prepayment of the
Mortgage  Loan in  accordance  with the terms of this Mortgage Note and the Loan
Documents.

     (e) "Make-Whole Amount" means an amount equal to the excess, if any, of the
Discounted Value of the Called Principal of the Mortgage Loan over the amount of
such Called  Principal;  provided that the Make-Whole  Amount may in no event be

                                      -2-
<PAGE>

less than 1% of the Called  Principal  of the Mortgage  Loan.  In no event shall
delivery to any of the Lenders of any certificate of a Senior Financial  Officer
(or of any other writing by or on behalf of any of the Borrowers) specifying the
calculation  of any  Make-Whole  Amount  affect  the  rights of the  Lenders  to
challenge the accuracy of any such  calculation  or the rights of the Lenders to
be paid the full amount of any Make-Whole  Amount due to them in accordance with
the terms of this  Agreement.  For the purposes of  determining  the  Make-Whole
Amount, the following terms have the following meanings:

     (i) "Called Principal" means the principal of such Mortgage Loan that is to
be prepaid  pursuant to the terms of this Section 4 or has become or is declared
to be immediately due and payable as a result of an Event of Default (as defined
in Section 9 below), as the context requires.

     (ii) "Discounted  Value" means, with respect to the Called Principal of the
Mortgage Loan, the amount obtained by discounting such Called Principal from the
Maturity Date to the Settlement Date with respect to such Called  Principal,  in
accordance with accepted financial practice and at a discount factor (applied on
the same  periodic  basis as that on which  interest  on the  Mortgage  Loans is
payable) equal to the Reinvestment Yield with respect to such Called Principal.

     (iii)  "Reinvestment  Yield" means, with respect to the Called Principal of
the Mortgage Loan, the yield to maturity implied by (i) the yield reported as of
10:00  a.m.  (New York City  time) on the  second  Business  Day  preceding  the
Settlement Date with respect to such Called Principal, on the applicable display
page in the pages  designated  as Pages PX1 through 8 (or such other  display as
may replace such pages on Bloomberg Financial Markets  ("Bloomberg") or, if such
page (or its successor screen on Bloomberg) is unavailable,  the Telerate Access
Service screen that  corresponds  most closely to such page for actively  traded
U.S.  Treasury  securities having a maturity equal to the Remaining Life of such
Called  Principal  as of such  Settlement  Date or  (ii)  if such  yield  is not
reported  as of  such  time  or  the  yield  reported  as of  such  time  is not
ascertainable,  the Treasury Constant  Maturity Series Yields reported,  for the
latest day for which such yield has been so reported  as of the second  Business
Day  preceding the  Settlement  Date with respect to such Called  Principal,  in
Federal  Reserve  Statistical  Release H.15 (519) (or any  comparable  successor
publication) for such U.S. Treasury  security.  The Reinvestment  Yield shall be
rounded to the number of decimal places as appears in the Interest Rate.

     (iv) "Remaining  Life" means,  with respect to such Called  Principal,  the
number of years  (calculated to the nearest  one-twelfth  year) that will elapse
between  the  Settlement  Date with  respect to such  Called  Principal  and the
Maturity Date.

     (v) "Settlement  Date" means the date on which such Called  Principal is to
be  prepaid  pursuant  to this  Section  4 or has  become or is  declared  to be
immediately due and payable as a result of an Event of Default.

     5. Method of Payment; When Payments Deemed Made. The Borrowers will pay all
sums becoming due hereunder by Federal funds transfer of  immediately  available
funds to the  account  of the  Lender as  specified  in  Schedule  A to the Loan
Agreement, or by such other method or at such other address as such Lender shall
have from time to time  specified  to the  Parent in writing  for such  purpose,
without the  presentation or surrender of any Mortgage Note or the making of any
notation  thereon.  Any such payment to be made to the Lender shall be deemed to
have been made on the Business Day such payment  actually  becomes  available to
the Lender at such Lender's bank prior to the 1:00 p.m.  (local time in New York
City).

                                      -3-

<PAGE>

     6. Payments Due on Non-Business Days.

     Anything herein to the contrary  notwithstanding  (but without limiting the
requirements of Section 4 that any date specified for prepayment of the Mortgage
Loan shall be a Business Day), any payment of principal of or Make-Whole  Amount
or interest on the Mortgage Loan that is due on a date other than a Business Day
shall  be made  on the  next  succeeding  Business  Day  without  including  the
additional days elapsed in the computation of the interest  payable on such next
succeeding Business Day; provided that if the Maturity Date is a date other than
a Business Day, the payment  otherwise due on the Maturity Date shall be made on
the next  succeeding  Business Day and shall include the additional days elapsed
in the computation of interest payable on such next succeeding Business Day.

     7. Prepayment in the Event of Casualty or  Condemnation;  Prepayment Upon a
Change in Control.  Proceeds of  casualty  or  condemnation  shall be applied in
accordance with Sections 2.04 and 2.05 of the Mortgage. In the event of a Change
of Control (as defined in the Loan Agreement), Section 4.4 of the Loan Agreement
shall govern.

     8. Extension of Maturity Date.  Provided that no Default (as defined in the
Loan Agreement) or Event of Default shall then be continuing,  the Borrowers may
extend the Maturity Date in strict  accordance  with Section  4.2(b) of the Loan
Agreement.  In no event shall the  Maturity  Date be extended  more than two (2)
years.

     9.  Event of  Default.  An "Event  of  Default"  shall  exist if any of the
following conditions or events shall occur and be continuing:

     (a) the  Borrowers  default in the payment of any  principal or  Make-Whole
Amount  with  respect to this  Mortgage  Note or any other note  evidencing  the
Mortgage Loan when the same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration of otherwise; or

     (b) the Borrowers  default in the payment of interest on this Mortgage Note
or any other note  evidencing  the Mortgage Loan for more than two Business Days
after the same become due and payable; or

     (c) an Event of Default shall occur under the Loan Agreement,  the Mortgage
or any other Loan Document.

     If an Event of Default  occurs and is  continuing,  the  principal  of this
Mortgage Note may be declared or otherwise become due and payable in the manner,
at the price  (including any applicable  Make-Whole  Amount) and with the effect
provided in the Loan Agreement.

     10. Joint and Several.  Subject to Section 3.6 of the Loan Agreement,  each
Borrower shall be jointly and severally  liable with respect to the  obligations
under this Mortgage Note.

     11.  Governing  Law.  This Mortgage Note shall be construed and enforced in
accordance  with, and the rights of the parties shall be governed by, the law of
the  State of New York  excluding  choice-of-law  principles  of the law of such
State that would require the  application  of the laws of a  jurisdiction  other
than such State.

                                      -4-

<PAGE>

Borrower:                          GTJ REIT, INC.

                                   By:__________________________________
                                         Name:
                                         Title:

Borrower:                          GREEN ACQUISITION, INC.

                                   By:__________________________________
                                         Name:
                                         Title:

Borrower:                          TRIBORO ACQUISITION, INC

                                   By:__________________________________
                                         Name:
                                         Title:

Borrower:                          JAMAICA ACQUISITION, INC.

                                   By:__________________________________
                                         Name:
                                         Title:

Borrower:                          165-25 147TH AVENUE, LLC

                                   By:__________________________________
                                         Name:
                                         Title:

Borrower:                          49-19 ROCKAWAY BEACH BOULEVARD, LLC

                                   By:__________________________________
                                         Name:
                                         Title:

Borrower:                          85-01 24TH AVENUE, LLC

                                   By:__________________________________
                                         Name:
                                         Title:

<PAGE>

Borrower:                          114-15 GUY BREWER BOULEVARD, LLC

                                   By:__________________________________
                                         Name:
                                         Title:

                                      -6-
<PAGE>

                                 GTJ REIT, INC.,
                            GREEN ACQUISITION, INC.,
                            TRIBORO ACQUISITION, INC,
                           JAMAICA ACQUISITION, INC.,
                            165-25 147TH AVENUE, LLC,
                      49-19 ROCKAWAY BEACH BOULEVARD, LLC,
                           85-01 24TH AVENUE, LLC, AND
                        114-15 GUY BREWER BOULEVARD, LLC

                              SENIOR MORTGAGE NOTE

No. MR-2                                                 July 2, 2007

$165,517.24                                              PPN:  36238@ AA4

     FOR VALUE RECEIVED,  each of GTJ REIT,  INC., a Maryland  corporation  (the
"Parent"), GREEN ACQUISITION, INC., a New York corporation, TRIBORO ACQUISITION,
INC, a New York corporation,  JAMAICA ACQUISITION, INC., a New York corporation,
165-25 147TH AVENUE, LLC, a New York limited liability company (the "First Green
Operating Subsidiary"),  49-19 ROCKAWAY BEACH BOULEVARD, LLC, a New York limited
liability company (the "Second Green Operating Subsidiary"),  85-01 24TH AVENUE,
LLC, a New York limited liability company (the "Triboro Operating  Subsidiary"),
and 114-15 GUY BREWER BOULEVARD,  LLC, a New York limited liability company (the
"Jamaica Operating Subsidiary")  (collectively,  herein called the "Borrowers"),
jointly  and  severally  hereby  promises  to pay to ING USA  ANNUITY  AND  LIFE
INSURANCE  COMPANY,  or  registered  assigns,  the  principal sum of ONE HUNDRED
SIXTY-FIVE  THOUSAND FIVE HUNDRED SEVENTEEN DOLLARS AND TWENTY-FOUR CENTS (or so
much thereof as shall remain  outstanding) on July 1, 2010, subject to extension
at the option of the  Borrowers  as set forth in Section 7 below (the  "Maturity
Date"),  with interest (computed on the basis of a 360-day year of twelve 30-day
months),  payable monthly on the first day of each calendar month  commencing on
August 1, 2007 and at maturity,  (i) on the unpaid  balance at the rate of 6.59%
per annum (the "Interest Rate"), and (ii) to the extent permitted by law, on any
overdue  payment of such interest  and,  during the  continuance  of an Event of
Default (as defined below),  on such unpaid principal balance and on any overdue
payment of any Make-Whole  Amount (as defined  below),  at a rate per annum from
time to time equal to the Default  Rate.  The Default Rate shall mean the lesser
of (a) the  Interest  Rate  plus  two  percent  (2%)  and (b) the  highest  rate
permitted by applicable law.

     1. Manner of Payment.  Payment of  principal,  interest and any  Make-Whole
Amount with respect to this  Mortgage Note are to be made in lawful money of the
United States of America.

     2. Senior  Mortgage  Notes.  This Mortgage Note is one of a class of senior
notes  (herein  called  the  "Mortgage  Notes")  issued  pursuant  to  the  Loan
Agreement,  dated as of June 30, 2007 (as from time to time amended, restated or
otherwise  modified,  the  "Loan  Agreement"),  among  the  Borrowers,  and  the
respective Lenders named therein, and is entitled to the benefits thereof and of
a certain Mortgage and Security Agreement (the "Mortgage") of even date herewith
made by the  First  Green  Operating  Subsidiary,  the  Second  Green  Operating
Subsidiary,   the  Triboro  Operating   Subsidiary  and  the  Jamaica  Operating
Subsidiary  encumbering  such  parties'  respective  fee simple  interest in the
properties  known as (i)  165-25  147th  Avenue,  Jamaica,  Queens,  (ii)  49-19
Rockaway Beach  Boulevard,  Averne,  Queens,  New York, (iii) 85-01 24th Avenue,
East Elmhurst, New York and (iv) 114-15 Guy Brewer Boulevard,  Jamaica,  Queens,
New York.

<PAGE>

     3.  Registered  Mortgage Note. This Mortgage Note is a registered note and,
as provided in the Loan  Agreement,  upon  surrender of this  Mortgage  Note for
registration of transfer,  duly endorsed, or accompanied by a written instrument
of transfer  duly  executed,  by the  registered  holder hereof or such holder's
attorney duly  authorized in writing,  a new Mortgage Note for a like  principal
amount will be issued to, and registered in the name of, the  transferee.  Prior
to due  presentment for  registration  of transfer,  the Borrowers may treat the
person in whose name this  Mortgage  Note is  registered as the owner hereof for
the purpose of receiving  payment and for all other purposes,  and the Borrowers
will not be affected by any notice to the contrary.

     4.  Optional  Prepayment.   This  Mortgage  Note  is  subject  to  optional
prepayment at the times and on the terms specified below:

     (a) Provided that there are no  Non-Mortgage  Loans (as defined in the Loan
Agreement) outstanding or Commitments (as defined in the Loan Agreement) to make
Non-Mortgage  Loans  available from the Lenders to the Borrowers,  the Borrowers
may, at their  option,  upon notice as provided in  subsection  (b),  prepay the
outstanding  principal of this Mortgage Note, and all other notes evidencing the
Mortgage  Loan (as defined in the Loan  Agreement),  in whole but not in part at
any time on or after the date that is 30 months after the date hereof,  together
with  all  accrued  interest  thereon  and  any  applicable  Make-Whole  Amount.
Notwithstanding  the  above-described  lock-out  period,  if Lenders  permit the
Borrowers  to prepay  the  Non-Mortgage  Loans  prior to the  expiration  of the
lock-out  period,  the  Borrowers  shall also be entitled to prepay the Mortgage
Loan,  together with all accrued interest thereon and any applicable  Make-Whole
Amount.

     (b) The Parent will give each Lender  written  notice of its  intention  to
make the optional  prepayment  hereunder  not less than five  Business  Days (as
defined in the Loan  Agreement)  and in any event not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify (i) such date
(which shall be a Business  Day),  (ii) the  aggregate  principal  amount of the
Mortgage  Loan to be  prepaid on such date,  (iii) the  principal  amount of the
Mortgage  Loan held by each  Lender to be prepaid,  and (iv) the  interest to be
paid on the  prepayment  date  with  respect  to such  principal  amounts  being
prepaid,  accompanied by a certificate of a Senior Financial Officer (as defined
in the Loan Agreement) as to the estimated  Make-Whole  Amount due in connection
with such prepayment  (calculated as if the date of such notice were the date of
the  prepayment),  setting forth the details of such  computation.  Two Business
Days prior to any such prepayment of the Mortgage Loan, the Parent shall deliver
to each  Lender a  certificate  of a Senior  Financial  Officer  specifying  the
calculation of such Make-Whole Amount as of the specified prepayment date.

     (c) The  principal  amount of the Mortgage Loan shall mature and become due
and payable on the date fixed for such  prepayment,  together  with  interest on
such principal amount accrued to such date and the applicable Make-Whole Amount,
if any. From and after such date,  unless the  Borrowers  shall fail to pay such
principal  amount when so due and payable,  on the date so fixed for prepayment,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.

     (d) The Borrowers will not and will not permit any Affiliate (as defined in
the Loan Agreement) to prepay, purchase,  redeem or otherwise acquire,  directly
or  indirectly,  the Mortgage  Loan except upon the payment or prepayment of the
Mortgage  Loan in  accordance  with the terms of this Mortgage Note and the Loan
Documents.

     (e) "Make-Whole Amount" means an amount equal to the excess, if any, of the
Discounted Value of the Called Principal of the Mortgage Loan over the amount of
such Called  Principal;  provided that the Make-Whole  Amount may in no event be
less than 1% of the Called  Principal  of the Mortgage  Loan.  In no event shall

                                      -2-
<PAGE>

delivery to any of the Lenders of any certificate of a Senior Financial  Officer
(or of any other writing by or on behalf of any of the Borrowers) specifying the
calculation  of any  Make-Whole  Amount  affect  the  rights of the  Lenders  to
challenge the accuracy of any such  calculation  or the rights of the Lenders to
be paid the full amount of any Make-Whole  Amount due to them in accordance with
the terms of this  Agreement.  For the purposes of  determining  the  Make-Whole
Amount, the following terms have the following meanings:

     (i) "Called Principal" means the principal of such Mortgage Loan that is to
be prepaid  pursuant to the terms of this Section 4 or has become or is declared
to be immediately due and payable as a result of an Event of Default (as defined
in Section 9 below), as the context requires.

     (ii) "Discounted  Value" means, with respect to the Called Principal of the
Mortgage Loan, the amount obtained by discounting such Called Principal from the
Maturity Date to the Settlement Date with respect to such Called  Principal,  in
accordance with accepted financial practice and at a discount factor (applied on
the same  periodic  basis as that on which  interest  on the  Mortgage  Loans is
payable) equal to the Reinvestment Yield with respect to such Called Principal.

     (iii)  "Reinvestment  Yield" means, with respect to the Called Principal of
the Mortgage Loan, the yield to maturity implied by (i) the yield reported as of
10:00  a.m.  (New York City  time) on the  second  Business  Day  preceding  the
Settlement Date with respect to such Called Principal, on the applicable display
page in the pages  designated  as Pages PX1 through 8 (or such other  display as
may replace such pages on Bloomberg Financial Markets  ("Bloomberg") or, if such
page (or its successor screen on Bloomberg) is unavailable,  the Telerate Access
Service screen that  corresponds  most closely to such page for actively  traded
U.S.  Treasury  securities having a maturity equal to the Remaining Life of such
Called  Principal  as of such  Settlement  Date or  (ii)  if such  yield  is not
reported  as of  such  time  or  the  yield  reported  as of  such  time  is not
ascertainable,  the Treasury Constant  Maturity Series Yields reported,  for the
latest day for which such yield has been so reported  as of the second  Business
Day  preceding the  Settlement  Date with respect to such Called  Principal,  in
Federal  Reserve  Statistical  Release H.15 (519) (or any  comparable  successor
publication) for such U.S. Treasury  security.  The Reinvestment  Yield shall be
rounded to the number of decimal places as appears in the Interest Rate.

     (iv) "Remaining  Life" means,  with respect to such Called  Principal,  the
number of years  (calculated to the nearest  one-twelfth  year) that will elapse
between  the  Settlement  Date with  respect to such  Called  Principal  and the
Maturity Date.

     (v) "Settlement  Date" means the date on which such Called  Principal is to
be  prepaid  pursuant  to this  Section  4 or has  become or is  declared  to be
immediately due and payable as a result of an Event of Default.

     5. Method of Payment; When Payments Deemed Made. The Borrowers will pay all
sums becoming due hereunder by Federal funds transfer of  immediately  available
funds to the  account  of the  Lender as  specified  in  Schedule  A to the Loan
Agreement, or by such other method or at such other address as such Lender shall
have from time to time  specified  to the  Parent in writing  for such  purpose,
without the  presentation or surrender of any Mortgage Note or the making of any
notation  thereon.  Any such payment to be made to the Lender shall be deemed to
have been made on the Business Day such payment  actually  becomes  available to
the Lender at such Lender's bank prior to the 1:00 p.m.  (local time in New York
City).

                                      -3-
<PAGE>

     6. Payments Due on Non-Business Days.

     Anything herein to the contrary  notwithstanding  (but without limiting the
requirements of Section 4 that any date specified for prepayment of the Mortgage
Loan shall be a Business Day), any payment of principal of or Make-Whole  Amount
or interest on the Mortgage Loan that is due on a date other than a Business Day
shall  be made  on the  next  succeeding  Business  Day  without  including  the
additional days elapsed in the computation of the interest  payable on such next
succeeding Business Day; provided that if the Maturity Date is a date other than
a Business Day, the payment  otherwise due on the Maturity Date shall be made on
the next  succeeding  Business Day and shall include the additional days elapsed
in the computation of interest payable on such next succeeding Business Day.

     7. Prepayment in the Event of Casualty or  Condemnation;  Prepayment Upon a
Change in Control.  Proceeds of  casualty  or  condemnation  shall be applied in
accordance with Sections 2.04 and 2.05 of the Mortgage. In the event of a Change
of Control (as defined in the Loan Agreement), Section 4.4 of the Loan Agreement
shall govern.

     8. Extension of Maturity Date.  Provided that no Default (as defined in the
Loan Agreement) or Event of Default shall then be continuing,  the Borrowers may
extend the Maturity Date in strict  accordance  with Section  4.2(b) of the Loan
Agreement.  In no event shall the  Maturity  Date be extended  more than two (2)
years.

     9.  Event of  Default.  An "Event  of  Default"  shall  exist if any of the
following conditions or events shall occur and be continuing:

     (a) the  Borrowers  default in the payment of any  principal or  Make-Whole
Amount  with  respect to this  Mortgage  Note or any other note  evidencing  the
Mortgage Loan when the same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration of otherwise; or

     (b) the Borrowers  default in the payment of interest on this Mortgage Note
or any other note  evidencing  the Mortgage Loan for more than two Business Days
after the same become due and payable; or

     (c) an Event of Default shall occur under the Loan Agreement,  the Mortgage
or any other Loan Document.

     If an Event of Default  occurs and is  continuing,  the  principal  of this
Mortgage Note may be declared or otherwise become due and payable in the manner,
at the price  (including any applicable  Make-Whole  Amount) and with the effect
provided in the Loan Agreement.

     10. Joint and Several.  Subject to Section 3.6 of the Loan Agreement,  each
Borrower shall be jointly and severally  liable with respect to the  obligations
under this Mortgage Note.

     11.  Governing  Law.  This Mortgage Note shall be construed and enforced in
accordance  with, and the rights of the parties shall be governed by, the law of
the  State of New York  excluding  choice-of-law  principles  of the law of such
State that would require the  application  of the laws of a  jurisdiction  other
than such State.

                                      -4-
<PAGE>

Borrower:                   GTJ REIT, INC.

                            By:____________________________________
                                  Name:
                                  Title:

Borrower:                   GREEN ACQUISITION, INC.

                            By:____________________________________
                                  Name:
                                  Title:

Borrower:                   TRIBORO ACQUISITION, INC

                            By:____________________________________
                                  Name:
                                  Title:

Borrower:                   JAMAICA ACQUISITION, INC.

                            By:____________________________________
                                  Name:
                                  Title:

Borrower:                   165-25 147TH AVENUE, LLC

                            By:____________________________________
                                  Name:
                                  Title:

Borrower:                   49-19 ROCKAWAY BEACH BOULEVARD, LLC

                            By:____________________________________
                                  Name:
                                  Title:

Borrower:                   85-01 24TH AVENUE, LLC

                            By:____________________________________
                                  Name:
                                  Title:

<PAGE>

Borrower:                   114-15 GUY BREWER BOULEVARD, LLC

                            By:____________________________________
                                  Name:
                                  Title:

                                      -6-
<PAGE>

                                 GTJ REIT, INC.,
                            GREEN ACQUISITION, INC.,
                            TRIBORO ACQUISITION, INC,
                           JAMAICA ACQUISITION, INC.,
                            165-25 147TH AVENUE, LLC,
                      49-19 ROCKAWAY BEACH BOULEVARD, LLC,
                           85-01 24TH AVENUE, LLC, AND
                        114-15 GUY BREWER BOULEVARD, LLC

                              SENIOR MORTGAGE NOTE

No. MR-3                                                   July 2, 2007

$96,551.72                                                 PPN:  36238@ AA4

     FOR VALUE RECEIVED,  each of GTJ REIT,  INC., a Maryland  corporation  (the
"Parent"), GREEN ACQUISITION, INC., a New York corporation, TRIBORO ACQUISITION,
INC, a New York corporation,  JAMAICA ACQUISITION, INC., a New York corporation,
165-25 147TH AVENUE, LLC, a New York limited liability company (the "First Green
Operating Subsidiary"),  49-19 ROCKAWAY BEACH BOULEVARD, LLC, a New York limited
liability company (the "Second Green Operating Subsidiary"),  85-01 24TH AVENUE,
LLC, a New York limited liability company (the "Triboro Operating  Subsidiary"),
and 114-15 GUY BREWER BOULEVARD,  LLC, a New York limited liability company (the
"Jamaica Operating Subsidiary")  (collectively,  herein called the "Borrowers"),
jointly  and  severally  hereby  promises  to pay to ING USA  ANNUITY  AND  LIFE
INSURANCE  COMPANY,  or  registered  assigns,  the  principal  sum of NINETY-SIX
THOUSAND  FIVE  HUNDRED  FIFTY-ONE  DOLLARS  AND  SEVENTY-TWO  CENTS (or so much
thereof as shall remain  outstanding)  on July 1, 2010,  subject to extension at
the  option of the  Borrowers  as set forth in  Section 7 below  (the  "Maturity
Date"),  with interest (computed on the basis of a 360-day year of twelve 30-day
months),  payable monthly on the first day of each calendar month  commencing on
August 1, 2007 and at maturity,  (i) on the unpaid  balance at the rate of 6.59%
per annum (the "Interest Rate"), and (ii) to the extent permitted by law, on any
overdue  payment of such interest  and,  during the  continuance  of an Event of
Default (as defined below),  on such unpaid principal balance and on any overdue
payment of any Make-Whole  Amount (as defined  below),  at a rate per annum from
time to time equal to the Default  Rate.  The Default Rate shall mean the lesser
of (a) the  Interest  Rate  plus  two  percent  (2%)  and (b) the  highest  rate
permitted by applicable law.

     1. Manner of Payment.  Payment of  principal,  interest and any  Make-Whole
Amount with respect to this  Mortgage Note are to be made in lawful money of the
United States of America.

     2. Senior  Mortgage  Notes.  This Mortgage Note is one of a class of senior
notes  (herein  called  the  "Mortgage  Notes")  issued  pursuant  to  the  Loan
Agreement,  dated as of June 30, 2007 (as from time to time amended, restated or
otherwise  modified,  the  "Loan  Agreement"),  among  the  Borrowers,  and  the
respective Lenders named therein, and is entitled to the benefits thereof and of
a certain Mortgage and Security Agreement (the "Mortgage") of even date herewith
made by the  First  Green  Operating  Subsidiary,  the  Second  Green  Operating
Subsidiary,   the  Triboro  Operating   Subsidiary  and  the  Jamaica  Operating
Subsidiary  encumbering  such  parties'  respective  fee simple  interest in the
properties  known as (i)  165-25  147th  Avenue,  Jamaica,  Queens,  (ii)  49-19
Rockaway Beach  Boulevard,  Averne,  Queens,  New York, (iii) 85-01 24th Avenue,
East Elmhurst, New York and (iv) 114-15 Guy Brewer Boulevard,  Jamaica,  Queens,
New York.

<PAGE>

     3.  Registered  Mortgage Note. This Mortgage Note is a registered note and,
as provided in the Loan  Agreement,  upon  surrender of this  Mortgage  Note for
registration of transfer,  duly endorsed, or accompanied by a written instrument
of transfer  duly  executed,  by the  registered  holder hereof or such holder's
attorney duly  authorized in writing,  a new Mortgage Note for a like  principal
amount will be issued to, and registered in the name of, the  transferee.  Prior
to due  presentment for  registration  of transfer,  the Borrowers may treat the
person in whose name this  Mortgage  Note is  registered as the owner hereof for
the purpose of receiving  payment and for all other purposes,  and the Borrowers
will not be affected by any notice to the contrary.

     4.  Optional  Prepayment.   This  Mortgage  Note  is  subject  to  optional
prepayment at the times and on the terms specified below:

     (a) Provided that there are no  Non-Mortgage  Loans (as defined in the Loan
Agreement) outstanding or Commitments (as defined in the Loan Agreement) to make
Non-Mortgage  Loans  available from the Lenders to the Borrowers,  the Borrowers
may, at their  option,  upon notice as provided in  subsection  (b),  prepay the
outstanding  principal of this Mortgage Note, and all other notes evidencing the
Mortgage  Loan (as defined in the Loan  Agreement),  in whole but not in part at
any time on or after the date that is 30 months after the date hereof,  together
with  all  accrued  interest  thereon  and  any  applicable  Make-Whole  Amount.
Notwithstanding  the  above-described  lock-out  period,  if Lenders  permit the
Borrowers  to prepay  the  Non-Mortgage  Loans  prior to the  expiration  of the
lock-out  period,  the  Borrowers  shall also be entitled to prepay the Mortgage
Loan,  together with all accrued interest thereon and any applicable  Make-Whole
Amount.

     (b) The Parent will give each Lender  written  notice of its  intention  to
make the optional  prepayment  hereunder  not less than five  Business  Days (as
defined in the Loan  Agreement)  and in any event not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify (i) such date
(which shall be a Business  Day),  (ii) the  aggregate  principal  amount of the
Mortgage  Loan to be  prepaid on such date,  (iii) the  principal  amount of the
Mortgage  Loan held by each  Lender to be prepaid,  and (iv) the  interest to be
paid on the  prepayment  date  with  respect  to such  principal  amounts  being
prepaid,  accompanied by a certificate of a Senior Financial Officer (as defined
in the Loan Agreement) as to the estimated  Make-Whole  Amount due in connection
with such prepayment  (calculated as if the date of such notice were the date of
the  prepayment),  setting forth the details of such  computation.  Two Business
Days prior to any such prepayment of the Mortgage Loan, the Parent shall deliver
to each  Lender a  certificate  of a Senior  Financial  Officer  specifying  the
calculation of such Make-Whole Amount as of the specified prepayment date.

     (c) The  principal  amount of the Mortgage Loan shall mature and become due
and payable on the date fixed for such  prepayment,  together  with  interest on
such principal amount accrued to such date and the applicable Make-Whole Amount,
if any. From and after such date,  unless the  Borrowers  shall fail to pay such
principal  amount when so due and payable,  on the date so fixed for prepayment,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.

     (d) The Borrowers will not and will not permit any Affiliate (as defined in
the Loan Agreement) to prepay, purchase,  redeem or otherwise acquire,  directly
or  indirectly,  the Mortgage  Loan except upon the payment or prepayment of the
Mortgage  Loan in  accordance  with the terms of this Mortgage Note and the Loan
Documents.

     (e) "Make-Whole Amount" means an amount equal to the excess, if any, of the
Discounted Value of the Called Principal of the Mortgage Loan over the amount of
such Called  Principal;  provided that the Make-Whole  Amount may in no event be
less than 1% of the Called  Principal  of the Mortgage  Loan.  In no event shall

                                      -2-
<PAGE>

delivery to any of the Lenders of any certificate of a Senior Financial  Officer
(or of any other writing by or on behalf of any of the Borrowers) specifying the
calculation  of any  Make-Whole  Amount  affect  the  rights of the  Lenders  to
challenge the accuracy of any such  calculation  or the rights of the Lenders to
be paid the full amount of any Make-Whole  Amount due to them in accordance with
the terms of this  Agreement.  For the purposes of  determining  the  Make-Whole
Amount, the following terms have the following meanings:

     (i) "Called Principal" means the principal of such Mortgage Loan that is to
be prepaid  pursuant to the terms of this Section 4 or has become or is declared
to be immediately due and payable as a result of an Event of Default (as defined
in Section 9 below), as the context requires.

     (ii) "Discounted  Value" means, with respect to the Called Principal of the
Mortgage Loan, the amount obtained by discounting such Called Principal from the
Maturity Date to the Settlement Date with respect to such Called  Principal,  in
accordance with accepted financial practice and at a discount factor (applied on
the same  periodic  basis as that on which  interest  on the  Mortgage  Loans is
payable) equal to the Reinvestment Yield with respect to such Called Principal.

     (iii)  "Reinvestment  Yield" means, with respect to the Called Principal of
the Mortgage Loan, the yield to maturity implied by (i) the yield reported as of
10:00  a.m.  (New York City  time) on the  second  Business  Day  preceding  the
Settlement Date with respect to such Called Principal, on the applicable display
page in the pages  designated  as Pages PX1 through 8 (or such other  display as
may replace such pages on Bloomberg Financial Markets  ("Bloomberg") or, if such
page (or its successor screen on Bloomberg) is unavailable,  the Telerate Access
Service screen that  corresponds  most closely to such page for actively  traded
U.S.  Treasury  securities having a maturity equal to the Remaining Life of such
Called  Principal  as of such  Settlement  Date or  (ii)  if such  yield  is not
reported  as of  such  time  or  the  yield  reported  as of  such  time  is not
ascertainable,  the Treasury Constant  Maturity Series Yields reported,  for the
latest day for which such yield has been so reported  as of the second  Business
Day  preceding the  Settlement  Date with respect to such Called  Principal,  in
Federal  Reserve  Statistical  Release H.15 (519) (or any  comparable  successor
publication) for such U.S. Treasury  security.  The Reinvestment  Yield shall be
rounded to the number of decimal places as appears in the Interest Rate.

     (iv) "Remaining  Life" means,  with respect to such Called  Principal,  the
number of years  (calculated to the nearest  one-twelfth  year) that will elapse
between  the  Settlement  Date with  respect to such  Called  Principal  and the
Maturity Date.

     (v) "Settlement  Date" means the date on which such Called  Principal is to
be  prepaid  pursuant  to this  Section  4 or has  become or is  declared  to be
immediately due and payable as a result of an Event of Default.

     5. Method of Payment; When Payments Deemed Made. The Borrowers will pay all
sums becoming due hereunder by Federal funds transfer of  immediately  available
funds to the  account  of the  Lender as  specified  in  Schedule  A to the Loan
Agreement, or by such other method or at such other address as such Lender shall
have from time to time  specified  to the  Parent in writing  for such  purpose,
without the  presentation or surrender of any Mortgage Note or the making of any
notation  thereon.  Any such payment to be made to the Lender shall be deemed to
have been made on the Business Day such payment  actually  becomes  available to
the Lender at such Lender's bank prior to the 1:00 p.m.  (local time in New York
City).

                                      -3-
<PAGE>

     6. Payments Due on Non-Business Days.

     Anything herein to the contrary  notwithstanding  (but without limiting the
requirements of Section 4 that any date specified for prepayment of the Mortgage
Loan shall be a Business Day), any payment of principal of or Make-Whole  Amount
or interest on the Mortgage Loan that is due on a date other than a Business Day
shall  be made  on the  next  succeeding  Business  Day  without  including  the
additional days elapsed in the computation of the interest  payable on such next
succeeding Business Day; provided that if the Maturity Date is a date other than
a Business Day, the payment  otherwise due on the Maturity Date shall be made on
the next  succeeding  Business Day and shall include the additional days elapsed
in the computation of interest payable on such next succeeding Business Day.

     7. Prepayment in the Event of Casualty or  Condemnation;  Prepayment Upon a
Change in Control.  Proceeds of  casualty  or  condemnation  shall be applied in
accordance with Sections 2.04 and 2.05 of the Mortgage. In the event of a Change
of Control (as defined in the Loan Agreement), Section 4.4 of the Loan Agreement
shall govern.

     8. Extension of Maturity Date.  Provided that no Default (as defined in the
Loan Agreement) or Event of Default shall then be continuing,  the Borrowers may
extend the Maturity Date in strict  accordance  with Section  4.2(b) of the Loan
Agreement.  In no event shall the  Maturity  Date be extended  more than two (2)
years.

     9.  Event of  Default.  An "Event  of  Default"  shall  exist if any of the
following conditions or events shall occur and be continuing:

     (a) the  Borrowers  default in the payment of any  principal or  Make-Whole
Amount  with  respect to this  Mortgage  Note or any other note  evidencing  the
Mortgage Loan when the same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration of otherwise; or

     (b) the Borrowers  default in the payment of interest on this Mortgage Note
or any other note  evidencing  the Mortgage Loan for more than two Business Days
after the same become due and payable; or

     (c) an Event of Default shall occur under the Loan Agreement,  the Mortgage
or any other Loan Document.

     If an Event of Default  occurs and is  continuing,  the  principal  of this
Mortgage Note may be declared or otherwise become due and payable in the manner,
at the price  (including any applicable  Make-Whole  Amount) and with the effect
provided in the Loan Agreement.

     10. Joint and Several.  Subject to Section 3.6 of the Loan Agreement,  each
Borrower shall be jointly and severally  liable with respect to the  obligations
under this Mortgage Note.

     11.  Governing  Law.  This Mortgage Note shall be construed and enforced in
accordance  with, and the rights of the parties shall be governed by, the law of
the  State of New York  excluding  choice-of-law  principles  of the law of such
State that would require the  application  of the laws of a  jurisdiction  other
than such State.

                                      -4-
<PAGE>

Borrower:                             GTJ REIT, INC.

                                      By:______________________________
                                            Name:
                                            Title:

Borrower:                             GREEN ACQUISITION, INC.

                                      By:______________________________
                                            Name:
                                            Title:

Borrower:                             TRIBORO ACQUISITION, INC

                                      By:______________________________
                                            Name:
                                            Title:

Borrower:                             JAMAICA ACQUISITION, INC.

                                      By:______________________________
                                            Name:
                                            Title:

Borrower:                             165-25 147TH AVENUE, LLC

                                      By:______________________________
                                            Name:
                                            Title:

Borrower:                             49-19 ROCKAWAY BEACH BOULEVARD, LLC

                                      By:______________________________
                                            Name:
                                            Title:

Borrower:                             85-01 24TH AVENUE, LLC

                                      By:______________________________
                                            Name:
                                            Title:

<PAGE>

Borrower:                             114-15 GUY BREWER BOULEVARD, LLC

                                      By:______________________________
                                            Name:
                                            Title:

-6-
<PAGE>

 GTJ REIT, INC.,
                            GREEN ACQUISITION, INC.,
                            TRIBORO ACQUISITION, INC,
                           JAMAICA ACQUISITION, INC.,
                            165-25 147TH AVENUE, LLC,
                      49-19 ROCKAWAY BEACH BOULEVARD, LLC,
                           85-01 24TH AVENUE, LLC, AND
                        114-15 GUY BREWER BOULEVARD, LLC

                              SENIOR MORTGAGE NOTE

No. MR-4                                             July __, 2007

$344,827.59                                          PPN:  36238@ AA4

     FOR VALUE RECEIVED,  each of GTJ REIT,  INC., a Maryland  corporation  (the
"Parent"), GREEN ACQUISITION, INC., a New York corporation, TRIBORO ACQUISITION,
INC, a New York corporation,  JAMAICA ACQUISITION, INC., a New York corporation,
165-25 147TH AVENUE, LLC, a New York limited liability company (the "First Green
Operating Subsidiary"),  49-19 ROCKAWAY BEACH BOULEVARD, LLC, a New York limited
liability company (the "Second Green Operating Subsidiary"),  85-01 24TH AVENUE,
LLC, a New York limited liability company (the "Triboro Operating  Subsidiary"),
and 114-15 GUY BREWER BOULEVARD,  LLC, a New York limited liability company (the
"Jamaica Operating Subsidiary")  (collectively,  herein called the "Borrowers"),
jointly and severally  hereby  promises to pay to ING LIFE INSURANCE AND ANNUITY
COMPANY,  or registered  assigns,  the principal sum of THREE HUNDRED FORTY-FOUR
THOUSAND EIGHT HUNDRED  TWENTY-SEVEN  DOLLARS AND  FIFTY-NINE  CENTS (or so much
thereof as shall remain  outstanding)  on July 1, 2010,  subject to extension at
the  option of the  Borrowers  as set forth in  Section 7 below  (the  "Maturity
Date"),  with interest (computed on the basis of a 360-day year of twelve 30-day
months),  payable monthly on the first day of each calendar month  commencing on
August 1, 2007 and at maturity,  (i) on the unpaid  balance at the rate of 6.59%
per annum (the "Interest Rate"), and (ii) to the extent permitted by law, on any
overdue  payment of such interest  and,  during the  continuance  of an Event of
Default (as defined below),  on such unpaid principal balance and on any overdue
payment of any Make-Whole  Amount (as defined  below),  at a rate per annum from
time to time equal to the Default  Rate.  The Default Rate shall mean the lesser
of (a) the  Interest  Rate  plus  two  percent  (2%)  and (b) the  highest  rate
permitted by applicable law.

     1. Manner of Payment.  Payment of  principal,  interest and any  Make-Whole
Amount with respect to this  Mortgage Note are to be made in lawful money of the
United States of America.

     2. Senior  Mortgage  Notes.  This Mortgage Note is one of a class of senior
notes  (herein  called  the  "Mortgage  Notes")  issued  pursuant  to  the  Loan
Agreement,  dated as of June 30, 2007 (as from time to time amended, restated or
otherwise  modified,  the  "Loan  Agreement"),  among  the  Borrowers,  and  the
respective Lenders named therein, and is entitled to the benefits thereof and of
a certain Mortgage and Security Agreement (the "Mortgage") of even date herewith
made by the  First  Green  Operating  Subsidiary,  the  Second  Green  Operating
Subsidiary,   the  Triboro  Operating   Subsidiary  and  the  Jamaica  Operating
Subsidiary  encumbering  such  parties'  respective  fee simple  interest in the
properties  known as (i)  165-25  147th  Avenue,  Jamaica,  Queens,  (ii)  49-19
Rockaway Beach  Boulevard,  Averne,  Queens,  New York, (iii) 85-01 24th Avenue,
East Elmhurst, New York and (iv) 114-15 Guy Brewer Boulevard,  Jamaica,  Queens,
New York.

<PAGE>

     3.  Registered  Mortgage Note. This Mortgage Note is a registered note and,
as provided in the Loan  Agreement,  upon  surrender of this  Mortgage  Note for
registration of transfer,  duly endorsed, or accompanied by a written instrument
of transfer  duly  executed,  by the  registered  holder hereof or such holder's
attorney duly  authorized in writing,  a new Mortgage Note for a like  principal
amount will be issued to, and registered in the name of, the  transferee.  Prior
to due  presentment for  registration  of transfer,  the Borrowers may treat the
person in whose name this  Mortgage  Note is  registered as the owner hereof for
the purpose of receiving  payment and for all other purposes,  and the Borrowers
will not be affected by any notice to the contrary.

     4.  Optional  Prepayment.   This  Mortgage  Note  is  subject  to  optional
prepayment at the times and on the terms specified below:

     (a) Provided that there are no  Non-Mortgage  Loans (as defined in the Loan
Agreement) outstanding or Commitments (as defined in the Loan Agreement) to make
Non-Mortgage  Loans  available from the Lenders to the Borrowers,  the Borrowers
may, at their  option,  upon notice as provided in  subsection  (b),  prepay the
outstanding  principal of this Mortgage Note, and all other notes evidencing the
Mortgage  Loan (as defined in the Loan  Agreement),  in whole but not in part at
any time on or after the date that is 30 months after the date hereof,  together
with  all  accrued  interest  thereon  and  any  applicable  Make-Whole  Amount.
Notwithstanding  the  above-described  lock-out  period,  if Lenders  permit the
Borrowers  to prepay  the  Non-Mortgage  Loans  prior to the  expiration  of the
lock-out  period,  the  Borrowers  shall also be entitled to prepay the Mortgage
Loan,  together with all accrued interest thereon and any applicable  Make-Whole
Amount.

     (b) The Parent will give each Lender  written  notice of its  intention  to
make the optional  prepayment  hereunder  not less than five  Business  Days (as
defined in the Loan  Agreement)  and in any event not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify (i) such date
(which shall be a Business  Day),  (ii) the  aggregate  principal  amount of the
Mortgage  Loan to be  prepaid on such date,  (iii) the  principal  amount of the
Mortgage  Loan held by each  Lender to be prepaid,  and (iv) the  interest to be
paid on the  prepayment  date  with  respect  to such  principal  amounts  being
prepaid,  accompanied by a certificate of a Senior Financial Officer (as defined
in the Loan Agreement) as to the estimated  Make-Whole  Amount due in connection
with such prepayment  (calculated as if the date of such notice were the date of
the  prepayment),  setting forth the details of such  computation.  Two Business
Days prior to any such prepayment of the Mortgage Loan, the Parent shall deliver
to each  Lender a  certificate  of a Senior  Financial  Officer  specifying  the
calculation of such Make-Whole Amount as of the specified prepayment date.

     (c) The  principal  amount of the Mortgage Loan shall mature and become due
and payable on the date fixed for such  prepayment,  together  with  interest on
such principal amount accrued to such date and the applicable Make-Whole Amount,
if any. From and after such date,  unless the  Borrowers  shall fail to pay such
principal  amount when so due and payable,  on the date so fixed for prepayment,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.

     (d) The Borrowers will not and will not permit any Affiliate (as defined in
the Loan Agreement) to prepay, purchase,  redeem or otherwise acquire,  directly
or  indirectly,  the Mortgage  Loan except upon the payment or prepayment of the
Mortgage  Loan in  accordance  with the terms of this Mortgage Note and the Loan
Documents.

     (e) "Make-Whole Amount" means an amount equal to the excess, if any, of the
Discounted Value of the Called Principal of the Mortgage Loan over the amount of
such Called  Principal;  provided that the Make-Whole  Amount may in no event be

                                      -2-
<PAGE>

less than 1% of the Called  Principal  of the Mortgage  Loan.  In no event shall
delivery to any of the Lenders of any certificate of a Senior Financial  Officer
(or of any other writing by or on behalf of any of the Borrowers) specifying the
calculation  of any  Make-Whole  Amount  affect  the  rights of the  Lenders  to
challenge the accuracy of any such  calculation  or the rights of the Lenders to
be paid the full amount of any Make-Whole  Amount due to them in accordance with
the terms of this  Agreement.  For the purposes of  determining  the  Make-Whole
Amount, the following terms have the following meanings:

     (i) "Called Principal" means the principal of such Mortgage Loan that is to
be prepaid  pursuant to the terms of this Section 4 or has become or is declared
to be immediately due and payable as a result of an Event of Default (as defined
in Section 9 below), as the context requires.

     (ii) "Discounted  Value" means, with respect to the Called Principal of the
Mortgage Loan, the amount obtained by discounting such Called Principal from the
Maturity Date to the Settlement Date with respect to such Called  Principal,  in
accordance with accepted financial practice and at a discount factor (applied on
the same  periodic  basis as that on which  interest  on the  Mortgage  Loans is
payable) equal to the Reinvestment Yield with respect to such Called Principal.

     (iii)  "Reinvestment  Yield" means, with respect to the Called Principal of
the Mortgage Loan, the yield to maturity implied by (i) the yield reported as of
10:00  a.m.  (New York City  time) on the  second  Business  Day  preceding  the
Settlement Date with respect to such Called Principal, on the applicable display
page in the pages  designated  as Pages PX1 through 8 (or such other  display as
may replace such pages on Bloomberg Financial Markets  ("Bloomberg") or, if such
page (or its successor screen on Bloomberg) is unavailable,  the Telerate Access
Service screen that  corresponds  most closely to such page for actively  traded
U.S.  Treasury  securities having a maturity equal to the Remaining Life of such
Called  Principal  as of such  Settlement  Date or  (ii)  if such  yield  is not
reported  as of  such  time  or  the  yield  reported  as of  such  time  is not
ascertainable,  the Treasury Constant  Maturity Series Yields reported,  for the
latest day for which such yield has been so reported  as of the second  Business
Day  preceding the  Settlement  Date with respect to such Called  Principal,  in
Federal  Reserve  Statistical  Release H.15 (519) (or any  comparable  successor
publication) for such U.S. Treasury  security.  The Reinvestment  Yield shall be
rounded to the number of decimal places as appears in the Interest Rate.

     (iv) "Remaining  Life" means,  with respect to such Called  Principal,  the
number of years  (calculated to the nearest  one-twelfth  year) that will elapse
between  the  Settlement  Date with  respect to such  Called  Principal  and the
Maturity Date.

     (v) "Settlement  Date" means the date on which such Called  Principal is to
be  prepaid  pursuant  to this  Section  4 or has  become or is  declared  to be
immediately due and payable as a result of an Event of Default.

     5. Method of Payment; When Payments Deemed Made. The Borrowers will pay all
sums becoming due hereunder by Federal funds transfer of  immediately  available
funds to the  account  of the  Lender as  specified  in  Schedule  A to the Loan
Agreement, or by such other method or at such other address as such Lender shall
have from time to time  specified  to the  Parent in writing  for such  purpose,
without the  presentation or surrender of any Mortgage Note or the making of any
notation  thereon.  Any such payment to be made to the Lender shall be deemed to
have been made on the Business Day such payment  actually  becomes  available to
the Lender at such Lender's bank prior to the 1:00 p.m.  (local time in New York
City).

                                      -3-

<PAGE>

     6. Payments Due on Non-Business Days.

     Anything herein to the contrary  notwithstanding  (but without limiting the
requirements of Section 4 that any date specified for prepayment of the Mortgage
Loan shall be a Business Day), any payment of principal of or Make-Whole  Amount
or interest on the Mortgage Loan that is due on a date other than a Business Day
shall  be made  on the  next  succeeding  Business  Day  without  including  the
additional days elapsed in the computation of the interest  payable on such next
succeeding Business Day; provided that if the Maturity Date is a date other than
a Business Day, the payment  otherwise due on the Maturity Date shall be made on
the next  succeeding  Business Day and shall include the additional days elapsed
in the computation of interest payable on such next succeeding Business Day.

     7. Prepayment in the Event of Casualty or  Condemnation;  Prepayment Upon a
Change in Control.  Proceeds of  casualty  or  condemnation  shall be applied in
accordance with Sections 2.04 and 2.05 of the Mortgage. In the event of a Change
of Control (as defined in the Loan Agreement), Section 4.4 of the Loan Agreement
shall govern.

     8. Extension of Maturity Date.  Provided that no Default (as defined in the
Loan Agreement) or Event of Default shall then be continuing,  the Borrowers may
extend the Maturity Date in strict  accordance  with Section  4.2(b) of the Loan
Agreement.  In no event shall the  Maturity  Date be extended  more than two (2)
years.

     9.  Event of  Default.  An "Event  of  Default"  shall  exist if any of the
following conditions or events shall occur and be continuing:

     (a) the  Borrowers  default in the payment of any  principal or  Make-Whole
Amount  with  respect to this  Mortgage  Note or any other note  evidencing  the
Mortgage Loan when the same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration of otherwise; or

     (b) the Borrowers  default in the payment of interest on this Mortgage Note
or any other note  evidencing  the Mortgage Loan for more than two Business Days
after the same become due and payable; or

     (c) an Event of Default shall occur under the Loan Agreement,  the Mortgage
or any other Loan Document.

     If an Event of Default  occurs and is  continuing,  the  principal  of this
Mortgage Note may be declared or otherwise become due and payable in the manner,
at the price  (including any applicable  Make-Whole  Amount) and with the effect
provided in the Loan Agreement.

     10. Joint and Several.  Subject to Section 3.6 of the Loan Agreement,  each
Borrower shall be jointly and severally  liable with respect to the  obligations
under this Mortgage Note.

     11.  Governing  Law.  This Mortgage Note shall be construed and enforced in
accordance  with, and the rights of the parties shall be governed by, the law of
the  State of New York  excluding  choice-of-law  principles  of the law of such
State that would require the  application  of the laws of a  jurisdiction  other
than such State.

                                      -4-
<PAGE>

Borrower:                                   GTJ REIT, INC.

                                            By:___________________________
                                                  Name:
                                                  Title:

Borrower:                                   GREEN ACQUISITION, INC.

                                            By:___________________________
                                                  Name:
                                                  Title:

Borrower:                                   TRIBORO ACQUISITION, INC

                                            By:___________________________
                                                  Name:
                                                  Title:

Borrower:                                   JAMAICA ACQUISITION, INC.

                                            By:___________________________
                                                  Name:
                                                  Title:

Borrower:                                   165-25 147TH AVENUE, LLC

                                            By:___________________________
                                                  Name:
                                                  Title:

Borrower:                                   49-19 ROCKAWAY BEACH BOULEVARD, LLC

                                            By:___________________________
                                                  Name:
                                                  Title:

Borrower:                                   85-01 24TH AVENUE, LLC

                                            By:
                                                  Name:
                                                  Title:

<PAGE>

Borrower:                                   114-15 GUY BREWER BOULEVARD, LLC

                                            By:___________________________
                                                  Name:
                                                  Title:

                                      -6-

                     GTJ REIT, INC.,
                            GREEN ACQUISITION, INC.,
                            TRIBORO ACQUISITION, INC,
                           JAMAICA ACQUISITION, INC.,
                            165-25 147TH AVENUE, LLC,
                      49-19 ROCKAWAY BEACH BOULEVARD, LLC,
                           85-01 24TH AVENUE, LLC, AND
                        114-15 GUY BREWER BOULEVARD, LLC

                              SENIOR MORTGAGE NOTE

No. MR-5                                             July 2, 2007

$96,551.72                                           PPN:  36238@ AA4

     FOR VALUE RECEIVED,  each of GTJ REIT,  INC., a Maryland  corporation  (the
"Parent"), GREEN ACQUISITION, INC., a New York corporation, TRIBORO ACQUISITION,
INC, a New York corporation,  JAMAICA ACQUISITION, INC., a New York corporation,
165-25 147TH AVENUE, LLC, a New York limited liability company (the "First Green
Operating Subsidiary"),  49-19 ROCKAWAY BEACH BOULEVARD, LLC, a New York limited
liability company (the "Second Green Operating Subsidiary"),  85-01 24TH AVENUE,
LLC, a New York limited liability company (the "Triboro Operating  Subsidiary"),
and 114-15 GUY BREWER BOULEVARD,  LLC, a New York limited liability company (the
"Jamaica Operating Subsidiary")  (collectively,  herein called the "Borrowers"),
jointly  and  severally  hereby  promises  to pay to  RELIASTAR  LIFE  INSURANCE
COMPANY,  or registered  assigns,  the principal sum of NINETY SIX THOUSAND FIVE
HUNDRED  FIFTY-ONE  DOLLARS AND  SEVENTY-TWO  CENTS (or so much thereof as shall
remain  outstanding) on July 1, 2010,  subject to extension at the option of the
Borrowers as set forth in Section 7 below (the "Maturity  Date"),  with interest
(computed  on the basis of a  360-day  year of twelve  30-day  months),  payable
monthly on the first day of each calendar month commencing on August 1, 2007 and
at  maturity,  (i) on the  unpaid  balance  at the rate of 6.59% per annum  (the
"Interest  Rate"),  and (ii) to the  extent  permitted  by law,  on any  overdue
payment of such interest and,  during the continuance of an Event of Default (as
defined below),  on such unpaid principal  balance and on any overdue payment of
any Make-Whole  Amount (as defined below), at a rate per annum from time to time
equal to the Default  Rate.  The  Default  Rate shall mean the lesser of (a) the
Interest  Rate plus two  percent  (2%) and (b) the  highest  rate  permitted  by
applicable law.

     1. Manner of Payment.  Payment of  principal,  interest and any  Make-Whole
Amount with respect to this  Mortgage Note are to be made in lawful money of the
United States of America.

     2. Senior  Mortgage  Notes.  This Mortgage Note is one of a class of senior
notes  (herein  called  the  "Mortgage  Notes")  issued  pursuant  to  the  Loan
Agreement,  dated as of June 30, 2007 (as from time to time amended, restated or
otherwise  modified,  the  "Loan  Agreement"),  among  the  Borrowers,  and  the
respective Lenders named therein, and is entitled to the benefits thereof and of
a certain Mortgage and Security Agreement (the "Mortgage") of even date herewith
made by the  First  Green  Operating  Subsidiary,  the  Second  Green  Operating
Subsidiary,   the  Triboro  Operating   Subsidiary  and  the  Jamaica  Operating
Subsidiary  encumbering  such  parties'  respective  fee simple  interest in the
properties  known as (i)  165-25  147th  Avenue,  Jamaica,  Queens,  (ii)  49-19
Rockaway Beach  Boulevard,  Averne,  Queens,  New York, (iii) 85-01 24th Avenue,
East Elmhurst, New York and (iv) 114-15 Guy Brewer Boulevard,  Jamaica,  Queens,
New York.

<PAGE>

     3.  Registered  Mortgage Note. This Mortgage Note is a registered note and,
as provided in the Loan  Agreement,  upon  surrender of this  Mortgage  Note for
registration of transfer,  duly endorsed, or accompanied by a written instrument
of transfer  duly  executed,  by the  registered  holder hereof or such holder's
attorney duly  authorized in writing,  a new Mortgage Note for a like  principal
amount will be issued to, and registered in the name of, the  transferee.  Prior
to due  presentment for  registration  of transfer,  the Borrowers may treat the
person in whose name this  Mortgage  Note is  registered as the owner hereof for
the purpose of receiving  payment and for all other purposes,  and the Borrowers
will not be affected by any notice to the contrary.

     4.  Optional  Prepayment.   This  Mortgage  Note  is  subject  to  optional
prepayment at the times and on the terms specified below:

     (a) Provided that there are no  Non-Mortgage  Loans (as defined in the Loan
Agreement) outstanding or Commitments (as defined in the Loan Agreement) to make
Non-Mortgage  Loans  available from the Lenders to the Borrowers,  the Borrowers
may, at their  option,  upon notice as provided in  subsection  (b),  prepay the
outstanding  principal of this Mortgage Note, and all other notes evidencing the
Mortgage  Loan (as defined in the Loan  Agreement),  in whole but not in part at
any time on or after the date that is 30 months after the date hereof,  together
with  all  accrued  interest  thereon  and  any  applicable  Make-Whole  Amount.
Notwithstanding  the  above-described  lock-out  period,  if Lenders  permit the
Borrowers  to prepay  the  Non-Mortgage  Loans  prior to the  expiration  of the
lock-out  period,  the  Borrowers  shall also be entitled to prepay the Mortgage
Loan,  together with all accrued interest thereon and any applicable  Make-Whole
Amount.

     (b) The Parent will give each Lender  written  notice of its  intention  to
make the optional  prepayment  hereunder  not less than five  Business  Days (as
defined in the Loan  Agreement)  and in any event not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify (i) such date
(which shall be a Business  Day),  (ii) the  aggregate  principal  amount of the
Mortgage  Loan to be  prepaid on such date,  (iii) the  principal  amount of the
Mortgage  Loan held by each  Lender to be prepaid,  and (iv) the  interest to be
paid on the  prepayment  date  with  respect  to such  principal  amounts  being
prepaid,  accompanied by a certificate of a Senior Financial Officer (as defined
in the Loan Agreement) as to the estimated  Make-Whole  Amount due in connection
with such prepayment  (calculated as if the date of such notice were the date of
the  prepayment),  setting forth the details of such  computation.  Two Business
Days prior to any such prepayment of the Mortgage Loan, the Parent shall deliver
to each  Lender a  certificate  of a Senior  Financial  Officer  specifying  the
calculation of such Make-Whole Amount as of the specified prepayment date.

     (c) The  principal  amount of the Mortgage Loan shall mature and become due
and payable on the date fixed for such  prepayment,  together  with  interest on
such principal amount accrued to such date and the applicable Make-Whole Amount,
if any. From and after such date,  unless the  Borrowers  shall fail to pay such
principal  amount when so due and payable,  on the date so fixed for prepayment,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.

     (d) The Borrowers will not and will not permit any Affiliate (as defined in
the Loan Agreement) to prepay, purchase,  redeem or otherwise acquire,  directly
or  indirectly,  the Mortgage  Loan except upon the payment or prepayment of the
Mortgage  Loan in  accordance  with the terms of this Mortgage Note and the Loan
Documents.

     (e) "Make-Whole Amount" means an amount equal to the excess, if any, of the
Discounted Value of the Called Principal of the Mortgage Loan over the amount of
such Called  Principal;  provided that the Make-Whole  Amount may in no event be
less than 1% of the Called  Principal  of the Mortgage  Loan.  In no event shall

                                      -2-
<PAGE>

delivery to any of the Lenders of any certificate of a Senior Financial  Officer
(or of any other writing by or on behalf of any of the Borrowers) specifying the
calculation  of any  Make-Whole  Amount  affect  the  rights of the  Lenders  to
challenge the accuracy of any such  calculation  or the rights of the Lenders to
be paid the full amount of any Make-Whole  Amount due to them in accordance with
the terms of this  Agreement.  For the purposes of  determining  the  Make-Whole
Amount, the following terms have the following meanings:

     (i) "Called Principal" means the principal of such Mortgage Loan that is to
be prepaid  pursuant to the terms of this Section 4 or has become or is declared
to be immediately due and payable as a result of an Event of Default (as defined
in Section 9 below), as the context requires.

     (ii) "Discounted  Value" means, with respect to the Called Principal of the
Mortgage Loan, the amount obtained by discounting such Called Principal from the
Maturity Date to the Settlement Date with respect to such Called  Principal,  in
accordance with accepted financial practice and at a discount factor (applied on
the same  periodic  basis as that on which  interest  on the  Mortgage  Loans is
payable) equal to the Reinvestment Yield with respect to such Called Principal.

     (iii)  "Reinvestment  Yield" means, with respect to the Called Principal of
the Mortgage Loan, the yield to maturity implied by (i) the yield reported as of
10:00  a.m.  (New York City  time) on the  second  Business  Day  preceding  the
Settlement Date with respect to such Called Principal, on the applicable display
page in the pages  designated  as Pages PX1 through 8 (or such other  display as
may replace such pages on Bloomberg Financial Markets  ("Bloomberg") or, if such
page (or its successor screen on Bloomberg) is unavailable,  the Telerate Access
Service screen that  corresponds  most closely to such page for actively  traded
U.S.  Treasury  securities having a maturity equal to the Remaining Life of such
Called  Principal  as of such  Settlement  Date or  (ii)  if such  yield  is not
reported  as of  such  time  or  the  yield  reported  as of  such  time  is not
ascertainable,  the Treasury Constant  Maturity Series Yields reported,  for the
latest day for which such yield has been so reported  as of the second  Business
Day  preceding the  Settlement  Date with respect to such Called  Principal,  in
Federal  Reserve  Statistical  Release H.15 (519) (or any  comparable  successor
publication) for such U.S. Treasury  security.  The Reinvestment  Yield shall be
rounded to the number of decimal places as appears in the Interest Rate.

     (iv) "Remaining  Life" means,  with respect to such Called  Principal,  the
number of years  (calculated to the nearest  one-twelfth  year) that will elapse
between  the  Settlement  Date with  respect to such  Called  Principal  and the
Maturity Date.

     (v) "Settlement  Date" means the date on which such Called  Principal is to
be  prepaid  pursuant  to this  Section  4 or has  become or is  declared  to be
immediately due and payable as a result of an Event of Default.

     5. Method of Payment; When Payments Deemed Made. The Borrowers will pay all
sums becoming due hereunder by Federal funds transfer of  immediately  available
funds to the  account  of the  Lender as  specified  in  Schedule  A to the Loan
Agreement, or by such other method or at such other address as such Lender shall
have from time to time  specified  to the  Parent in writing  for such  purpose,
without the  presentation or surrender of any Mortgage Note or the making of any
notation  thereon.  Any such payment to be made to the Lender shall be deemed to
have been made on the Business Day such payment  actually  becomes  available to
the Lender at such Lender's bank prior to the 1:00 p.m.  (local time in New York
City).

                                      -3-

<PAGE>

     6. Payments Due on Non-Business Days.

     Anything herein to the contrary  notwithstanding  (but without limiting the
requirements of Section 4 that any date specified for prepayment of the Mortgage
Loan shall be a Business Day), any payment of principal of or Make-Whole  Amount
or interest on the Mortgage Loan that is due on a date other than a Business Day
shall  be made  on the  next  succeeding  Business  Day  without  including  the
additional days elapsed in the computation of the interest  payable on such next
succeeding Business Day; provided that if the Maturity Date is a date other than
a Business Day, the payment  otherwise due on the Maturity Date shall be made on
the next  succeeding  Business Day and shall include the additional days elapsed
in the computation of interest payable on such next succeeding Business Day.

     7. Prepayment in the Event of Casualty or  Condemnation;  Prepayment Upon a
Change in Control.  Proceeds of  casualty  or  condemnation  shall be applied in
accordance with Sections 2.04 and 2.05 of the Mortgage. In the event of a Change
of Control (as defined in the Loan Agreement), Section 4.4 of the Loan Agreement
shall govern.

     8. Extension of Maturity Date.  Provided that no Default (as defined in the
Loan Agreement) or Event of Default shall then be continuing,  the Borrowers may
extend the Maturity Date in strict  accordance  with Section  4.2(b) of the Loan
Agreement.  In no event shall the  Maturity  Date be extended  more than two (2)
years.

     9.  Event of  Default.  An "Event  of  Default"  shall  exist if any of the
following conditions or events shall occur and be continuing:

     (a) the  Borrowers  default in the payment of any  principal or  Make-Whole
Amount  with  respect to this  Mortgage  Note or any other note  evidencing  the
Mortgage Loan when the same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration of otherwise; or

     (b) the Borrowers  default in the payment of interest on this Mortgage Note
or any other note  evidencing  the Mortgage Loan for more than two Business Days
after the same become due and payable; or

     (c) an Event of Default shall occur under the Loan Agreement,  the Mortgage
or any other Loan Document.

     If an Event of Default  occurs and is  continuing,  the  principal  of this
Mortgage Note may be declared or otherwise become due and payable in the manner,
at the price  (including any applicable  Make-Whole  Amount) and with the effect
provided in the Loan Agreement.

     10. Joint and Several.  Subject to Section 3.6 of the Loan Agreement,  each
Borrower shall be jointly and severally  liable with respect to the  obligations
under this Mortgage Note.

     11.  Governing  Law.  This Mortgage Note shall be construed and enforced in
accordance  with, and the rights of the parties shall be governed by, the law of
the  State of New York  excluding  choice-of-law  principles  of the law of such
State that would require the  application  of the laws of a  jurisdiction  other
than such State.

                                      -4-

<PAGE>

Borrower:                           GTJ REIT, INC.

                                    By:___________________________
                                          Name:
                                          Title:

Borrower:                           GREEN ACQUISITION, INC.

                                    By:___________________________
                                          Name:
                                          Title:

Borrower:                           TRIBORO ACQUISITION, INC

                                    By:___________________________
                                          Name:
                                          Title:

Borrower:                           JAMAICA ACQUISITION, INC.

                                    By:___________________________
                                          Name:
                                          Title:

Borrower:                           165-25 147TH AVENUE, LLC

                                    By:___________________________
                                          Name:
                                          Title:

Borrower:                           49-19 ROCKAWAY BEACH BOULEVARD, LLC

                                    By:___________________________
                                          Name:
                                          Title:

Borrower:                           85-01 24TH AVENUE, LLC

                                    By:___________________________
                                          Name:
                                          Title:

<PAGE>

Borrower:                           114-15 GUY BREWER BOULEVARD, LLC

                                    By:___________________________
                                          Name:
                                          Title:

                                      -6-

<PAGE>

 GTJ REIT, INC.,
                            GREEN ACQUISITION, INC.,
                            TRIBORO ACQUISITION, INC,
                           JAMAICA ACQUISITION, INC.,
                            165-25 147TH AVENUE, LLC,
                      49-19 ROCKAWAY BEACH BOULEVARD, LLC,
                           85-01 24TH AVENUE, LLC, AND
                        114-15 GUY BREWER BOULEVARD, LLC

                              SENIOR MORTGAGE NOTE

No. MR-6                                              July 2, 2007

$96,551.72                                            PPN:  36238@ AA4

     FOR VALUE RECEIVED,  each of GTJ REIT,  INC., a Maryland  corporation  (the
"Parent"), GREEN ACQUISITION, INC., a New York corporation, TRIBORO ACQUISITION,
INC, a New York corporation,  JAMAICA ACQUISITION, INC., a New York corporation,
165-25 147TH AVENUE, LLC, a New York limited liability company (the "First Green
Operating Subsidiary"),  49-19 ROCKAWAY BEACH BOULEVARD, LLC, a New York limited
liability company (the "Second Green Operating Subsidiary"),  85-01 24TH AVENUE,
LLC, a New York limited liability company (the "Triboro Operating  Subsidiary"),
and 114-15 GUY BREWER BOULEVARD,  LLC, a New York limited liability company (the
"Jamaica Operating Subsidiary")  (collectively,  herein called the "Borrowers"),
jointly  and  severally  hereby  promises  to pay to  SECURITY  LIFE  OF  DENVER
INSURANCE  COMPANY,  or  registered  assigns,  the  principal  sum of NINETY-SIX
THOUSAND  FIVE  HUNDRED  FIFTY-ONE  DOLLARS  AND  SEVENTY-TWO  CENTS (or so much
thereof as shall remain  outstanding)  on July 1, 2010,  subject to extension at
the  option of the  Borrowers  as set forth in  Section 7 below  (the  "Maturity
Date"),  with interest (computed on the basis of a 360-day year of twelve 30-day
months),  payable monthly on the first day of each calendar month  commencing on
August 1, 2007 and at maturity,  (i) on the unpaid  balance at the rate of 6.59%
per annum (the "Interest Rate"), and (ii) to the extent permitted by law, on any
overdue  payment of such interest  and,  during the  continuance  of an Event of
Default (as defined below),  on such unpaid principal balance and on any overdue
payment of any Make-Whole  Amount (as defined  below),  at a rate per annum from
time to time equal to the Default  Rate.  The Default Rate shall mean the lesser
of (a) the  Interest  Rate  plus  two  percent  (2%)  and (b) the  highest  rate
permitted by applicable law.

     1. Manner of Payment.  Payment of  principal,  interest and any  Make-Whole
Amount with respect to this Mortgage Note are to be made in lawful money of the
United States of America.

     2. Senior  Mortgage  Notes.  This Mortgage Note is one of a class of senior
notes  (herein  called  the  "Mortgage  Notes")  issued  pursuant  to  the  Loan
Agreement,  dated as of June 30, 2007 (as from time to time amended, restated or
otherwise  modified,  the  "Loan  Agreement"),  among  the  Borrowers,  and  the
respective Lenders named therein, and is entitled to the benefits thereof and of
a certain Mortgage and Security Agreement (the "Mortgage") of even date herewith
made by the  First  Green  Operating  Subsidiary,  the  Second  Green  Operating
Subsidiary,   the  Triboro  Operating   Subsidiary  and  the  Jamaica  Operating
Subsidiary  encumbering  such  parties'  respective  fee simple  interest in the
properties  known as (i)  165-25  147th  Avenue,  Jamaica,  Queens,  (ii)  49-19
Rockaway Beach  Boulevard,  Averne,  Queens,  New York, (iii) 85-01 24th Avenue,
East Elmhurst, New York and (iv) 114-15 Guy Brewer Boulevard,  Jamaica,  Queens,
New York.

<PAGE>

     3.  Registered  Mortgage Note. This Mortgage Note is a registered note and,
as provided in the Loan  Agreement,  upon  surrender of this  Mortgage  Note for
registration of transfer,  duly endorsed, or accompanied by a written instrument
of transfer  duly  executed,  by the  registered  holder hereof or such holder's
attorney duly  authorized in writing,  a new Mortgage Note for a like  principal
amount will be issued to, and registered in the name of, the  transferee.  Prior
to due  presentment for  registration  of transfer,  the Borrowers may treat the
person in whose name this  Mortgage  Note is  registered as the owner hereof for
the purpose of receiving  payment and for all other purposes,  and the Borrowers
will not be affected by any notice to the contrary.

     4.  Optional  Prepayment.   This  Mortgage  Note  is  subject  to  optional
prepayment at the times and on the terms specified below:

     (a) Provided that there are no  Non-Mortgage  Loans (as defined in the Loan
Agreement) outstanding or Commitments (as defined in the Loan Agreement) to make
Non-Mortgage  Loans  available from the Lenders to the Borrowers,  the Borrowers
may, at their  option,  upon notice as provided in  subsection  (b),  prepay the
outstanding  principal of this Mortgage Note, and all other notes evidencing the
Mortgage  Loan (as defined in the Loan  Agreement),  in whole but not in part at
any time on or after the date that is 30 months after the date hereof,  together
with  all  accrued  interest  thereon  and  any  applicable  Make-Whole  Amount.
Notwithstanding  the  above-described  lock-out  period,  if Lenders  permit the
Borrowers  to prepay  the  Non-Mortgage  Loans  prior to the  expiration  of the
lock-out  period,  the  Borrowers  shall also be entitled to prepay the Mortgage
Loan,  together with all accrued interest thereon and any applicable  Make-Whole
Amount.

     (b) The Parent will give each Lender  written  notice of its  intention  to
make the optional  prepayment  hereunder  not less than five  Business  Days (as
defined in the Loan  Agreement)  and in any event not more than 60 days prior to
the date fixed for such prepayment. Each such notice shall specify (i) such date
(which shall be a Business  Day),  (ii) the  aggregate  principal  amount of the
Mortgage  Loan to be  prepaid on such date,  (iii) the  principal  amount of the
Mortgage  Loan held by each  Lender to be prepaid,  and (iv) the  interest to be
paid on the  prepayment  date  with  respect  to such  principal  amounts  being
prepaid,  accompanied by a certificate of a Senior Financial Officer (as defined
in the Loan Agreement) as to the estimated  Make-Whole  Amount due in connection
with such prepayment  (calculated as if the date of such notice were the date of
the  prepayment),  setting forth the details of such  computation.  Two Business
Days prior to any such prepayment of the Mortgage Loan, the Parent shall deliver
to each  Lender a  certificate  of a Senior  Financial  Officer  specifying  the
calculation of such Make-Whole Amount as of the specified prepayment date.

     (c) The  principal  amount of the Mortgage Loan shall mature and become due
and payable on the date fixed for such  prepayment,  together  with  interest on
such principal amount accrued to such date and the applicable Make-Whole Amount,
if any. From and after such date,  unless the  Borrowers  shall fail to pay such
principal  amount when so due and payable,  on the date so fixed for prepayment,
together with the interest and Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.

     (d) The Borrowers will not and will not permit any Affiliate (as defined in
the Loan Agreement) to prepay, purchase,  redeem or otherwise acquire,  directly
or  indirectly,  the Mortgage  Loan except upon the payment or prepayment of the
Mortgage  Loan in  accordance  with the terms of this Mortgage Note and the Loan
Documents.

     (e) "Make-Whole Amount" means an amount equal to the excess, if any, of the
Discounted Value of the Called Principal of the Mortgage Loan over the amount of
such Called  Principal;  provided that the Make-Whole  Amount may in no event be
less than 1% of the Called  Principal  of the Mortgage  Loan.  In no event shall

                                      -2-
<PAGE>

delivery to any of the Lenders of any certificate of a Senior Financial  Officer
(or of any other writing by or on behalf of any of the Borrowers) specifying the
calculation  of any  Make-Whole  Amount  affect  the  rights of the  Lenders  to
challenge the accuracy of any such  calculation  or the rights of the Lenders to
be paid the full amount of any Make-Whole  Amount due to them in accordance with
the terms of this  Agreement.  For the purposes of  determining  the  Make-Whole
Amount, the following terms have the following meanings:

     (i) "Called Principal" means the principal of such Mortgage Loan that is to
be prepaid  pursuant to the terms of this Section 4 or has become or is declared
to be immediately due and payable as a result of an Event of Default (as defined
in Section 9 below), as the context requires.

     (ii) "Discounted  Value" means, with respect to the Called Principal of the
Mortgage Loan, the amount obtained by discounting such Called Principal from the
Maturity Date to the Settlement Date with respect to such Called  Principal,  in
accordance with accepted financial practice and at a discount factor (applied on
the same  periodic  basis as that on which  interest  on the  Mortgage  Loans is
payable) equal to the Reinvestment Yield with respect to such Called Principal.

     (iii)  "Reinvestment  Yield" means, with respect to the Called Principal of
the Mortgage Loan, the yield to maturity implied by (i) the yield reported as of
10:00  a.m.  (New York City  time) on the  second  Business  Day  preceding  the
Settlement Date with respect to such Called Principal, on the applicable display
page in the pages  designated  as Pages PX1 through 8 (or such other  display as
may replace such pages on Bloomberg Financial Markets  ("Bloomberg") or, if such
page (or its successor screen on Bloomberg) is unavailable,  the Telerate Access
Service screen that  corresponds  most closely to such page for actively  traded
U.S.  Treasury  securities having a maturity equal to the Remaining Life of such
Called  Principal  as of such  Settlement  Date or  (ii)  if such  yield  is not
reported  as of  such  time  or  the  yield  reported  as of  such  time  is not
ascertainable,  the Treasury Constant  Maturity Series Yields reported,  for the
latest day for which such yield has been so reported  as of the second  Business
Day  preceding the  Settlement  Date with respect to such Called  Principal,  in
Federal  Reserve  Statistical  Release H.15 (519) (or any  comparable  successor
publication) for such U.S. Treasury  security.  The Reinvestment  Yield shall be
rounded to the number of decimal places as appears in the Interest Rate.

     (iv) "Remaining  Life" means,  with respect to such Called  Principal,  the
number of years  (calculated to the nearest  one-twelfth  year) that will elapse
between  the  Settlement  Date with  respect to such  Called  Principal  and the
Maturity Date.

     (v) "Settlement  Date" means the date on which such Called  Principal is to
be  prepaid  pursuant  to this  Section  4 or has  become or is  declared  to be
immediately due and payable as a result of an Event of Default.

     5. Method of Payment; When Payments Deemed Made. The Borrowers will pay all
sums becoming due hereunder by Federal funds transfer of  immediately  available
funds to the  account  of the  Lender as  specified  in  Schedule  A to the Loan
Agreement, or by such other method or at such other address as such Lender shall
have from time to time  specified  to the  Parent in writing  for such  purpose,
without the  presentation or surrender of any Mortgage Note or the making of any
notation  thereon.  Any such payment to be made to the Lender shall be deemed to
have been made on the Business Day such payment  actually  becomes  available to
the Lender at such Lender's bank prior to the 1:00 p.m.  (local time in New York
City).

                                      -3-

<PAGE>

     6. Payments Due on Non-Business Days.

     Anything herein to the contrary  notwithstanding  (but without limiting the
requirements of Section 4 that any date specified for prepayment of the Mortgage
Loan shall be a Business Day), any payment of principal of or Make-Whole  Amount
or interest on the Mortgage Loan that is due on a date other than a Business Day
shall  be made  on the  next  succeeding  Business  Day  without  including  the
additional days elapsed in the computation of the interest  payable on such next
succeeding Business Day; provided that if the Maturity Date is a date other than
a Business Day, the payment  otherwise due on the Maturity Date shall be made on
the next  succeeding  Business Day and shall include the additional days elapsed
in the computation of interest payable on such next succeeding Business Day.

     7. Prepayment in the Event of Casualty or  Condemnation;  Prepayment Upon a
Change in Control.  Proceeds of  casualty  or  condemnation  shall be applied in
accordance with Sections 2.04 and 2.05 of the Mortgage. In the event of a Change
of Control (as defined in the Loan Agreement), Section 4.4 of the Loan Agreement
shall govern.

     8. Extension of Maturity Date.  Provided that no Default (as defined in the
Loan Agreement) or Event of Default shall then be continuing,  the Borrowers may
extend the Maturity Date in strict  accordance  with Section  4.2(b) of the Loan
Agreement.  In no event shall the  Maturity  Date be extended  more than two (2)
years.

     9.  Event of  Default.  An "Event  of  Default"  shall  exist if any of the
following conditions or events shall occur and be continuing:

     (a) the  Borrowers  default in the payment of any  principal or  Make-Whole
Amount  with  respect to this  Mortgage  Note or any other note  evidencing  the
Mortgage Loan when the same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration of otherwise; or

     (b) the Borrowers  default in the payment of interest on this Mortgage Note
or any other note  evidencing  the Mortgage Loan for more than two Business Days
after the same become due and payable; or

     (c) an Event of Default shall occur under the Loan Agreement,  the Mortgage
or any other Loan Document.

     If an Event of Default  occurs and is  continuing,  the  principal  of this
Mortgage Note may be declared or otherwise become due and payable in the manner,
at the price  (including any applicable  Make-Whole  Amount) and with the effect
provided in the Loan Agreement.

     10. Joint and Several.  Subject to Section 3.6 of the Loan Agreement,  each
Borrower shall be jointly and severally liable with respect to the
obligations under this Mortgage Note.

     11.  Governing  Law.  This Mortgage Note shall be construed and enforced in
accordance  with, and the rights of the parties shall be governed by, the law of
the  State of New York  excluding  choice-of-law  principles  of the law of such
State that would require the  application  of the laws of a  jurisdiction  other
than such State.

                                      -4-

<PAGE>

Borrower:                     GTJ REIT, INC.

                              By:_______________________________
                                    Name:
                                    Title:

Borrower:                     GREEN ACQUISITION, INC.

                              By:_______________________________
                                    Name:
                                    Title:

Borrower:                     TRIBORO ACQUISITION, INC

                              By:_______________________________
                                    Name:
                                    Title:

Borrower:                     JAMAICA ACQUISITION, INC.

                              By:_______________________________
                                    Name:
                                    Title:

Borrower:                     165-25 147TH AVENUE, LLC

                              By:_______________________________
                                    Name:
                                    Title:

Borrower:                     49-19 ROCKAWAY BEACH BOULEVARD, LLC

                              By:_______________________________
                                    Name:
                                    Title:

Borrower:                     85-01 24TH AVENUE, LLC

                              By:_______________________________
                                    Name:
                                    Title:

<PAGE>

Borrower:                     114-15 GUY BREWER BOULEVARD, LLC

                              By:_______________________________
                                    Name:
                                    Title:

                                      -6-MORTGAGE AND SECURITY AGREEMENT

Date:                  June ______, 2007
                                        ------

Mortgagor:             165-25 147th Avenue, LLC, 49-19 Rockaway Beach Boulevard,
                       LLC, 85-01 24th Avenue, LLC, and 114-15 Guy Brewer
                       Boulevard, LLC

Mortgagor's            444 Merrick Road
                                       -
Notice Address:        Suite 370
                       Lynbrook, New York 11563

Mortgagee:             ING USA ANNUITY AND LIFE INSURANCE
                       COMPANY, ING LIFE INSURANCE AND ANNUITY
                       COMPANY, RELIASTAR LIFE INSURANCE
                       COMPANY AND SECURITY LIFE OF DENVER
                       INSURANCE COMPANY
                       (Hereinafter sometimes "Lender")

Mortgagee's            5780 Powers Ferry Road, NW
Notice Address:        Suite 300
                       Atlanta, Georgia 30327-4349
                       Attn.: Private Placements

Aggregate Amount of
Notes:                 $1,000,000.00

Premises:

<TABLE>
<CAPTION>

<C> <C>                                                           <C>              <C>              <C>
Address                                                           County            Block(s)         Lot(s)
----------------------------------------------------------------  ----------------- ---------------- ------------------------------
165-25 147th Avenue, Jamaica, New York                            Queens            13296            7, 14 & 101
                                                                                    13298            11
                                                                                    13302            171
----------------------------------------------------------------  ----------------- ---------------- ------------------------------
49-19 Rockaway Beach Boulevard, Averne, New York                  Queens            15855            1
                                                                                    15841            5, 7, 8, 10, 14 & 70
----------------------------------------------------------------  ----------------- ---------------- ------------------------------
85-01 24th Avenue, East Elmhurst, New York                        Queens            1081             1
----------------------------------------------------------------  ----------------- ---------------- ------------------------------
114-15 Guy Brewer Boulevard, Jamaica, New York                    Queens            12327            1, 8 & 30
----------------------------------------------------------------  ----------------- ---------------- ------------------------------

</TABLE>

After recording, please return to:
Day Pitney LLP
242 Trumbull Street
Hartford, CT 06103-1212

                                       1

Attention: Thomas Wildman, Esq.

                         MORTGAGE AND SECURITY AGREEMENT

     THIS MORTGAGE AND SECURITY  AGREEMENT (this  "Mortgage") is made as of June
_____,  2007,  by and  between  165-25  147TH  AVENUE,  LLC, a New York  limited
liability company having an office at 444 Merrick Road, Suite 370, Lynbrook, New
York 11563 ("147th  Avenue"),  49-19 ROCKAWAY BEACH  BOULEVARD,  LLC, a New York
limited  liability  company  having an office at 444  Merrick  Road,  Suite 370,
Lynbrook,  New York 11563 ("Rockaway Beach"), 85-01 24TH AVENUE, LLC, a New York
limited  liability  company  having an office at 444  Merrick  Road,  Suite 370,
Lynbrook, New York 11563 ("24th Avenue"), and 114-15 GUY BREWER BOULEVARD,  LLC,
a New York limited liability company having an office at 444 Merrick Road, Suite
370, Lynbrook,  New York 11563 ("Guy Brewer" and collectively with 147th Avenue,
Rockaway  Beach,  and 24th  Avenue,  "Mortgagor"),  and ING USA ANNUITY AND LIFE
INSURANCE  COMPANY,  ING LIFE  INSURANCE  AND ANNUITY  COMPANY,  RELIASTAR  LIFE
INSURANCE COMPANY AND SECURITY LIFE OF DENVER INSURANCE COMPANY,  each having an
office at 5780 Powers Ferry Road,  NW, Suite 300,  Atlanta,  Georgia  30327-4349
(individually and collectively, "Lender", which term shall include other persons
that may from time to time become a Lender under the Loan  Agreement (as defined
below)).  As of even date herewith,  Lender,  Mortgagor and the other  borrowers
identified therein (collectively,  the "Borrowers") have executed a certain Loan
Agreement  (the  "Loan  Agreement")  pursuant  to  which  Lender  will  make the
following  loans to Borrower:  (i) a  $1,000,000  mortgage  loan (the  "Mortgage
Loan") in the principal amount of $1,000,000,  which Mortgage Loan is secured by
this Mortgage;  and (ii) non-mortgage  loans (the  "Non-Mortgage  Loans") in the
maximum  principal  amount  of  $71,500,000,  which  Non-Mortgage  Loans are not
secured by this Mortgage.

                                GRANTING CLAUSES

     For good  and  valuable  consideration  and to  secure  the  payment  of an
indebtedness   in  the  principal   sum  of  ONE  MILLION  and  00/100   Dollars
($1,000,000.00) lawful money of the United States, to be paid according to those
certain  Mortgage  Notes of even date herewith from  Borrowers to Lender in said
principal sum and by this reference made a part hereof (said Mortgage  Notes, as
the same may  hereafter be amended,  modified,  consolidated  or  extended,  the
"Mortgage Notes"), together with all other obligations and liabilities due or to
become due to Lender,  all  amounts,  sums and  expenses  paid  hereunder  by or
payable  to Lender  according  to the  terms  hereof,  and all other  covenants,
obligations and liabilities of Borrower under the Mortgage Notes,  this Mortgage
and the  Assignment  (hereinafter  defined) (all of the  foregoing  instruments,
collectively,  the "Loan  Documents"),  and  together  with all interest on said
indebtedness,  obligations, liabilities, amounts, sums, Advances (as hereinafter
defined) and expenses (all of the foregoing,  collectively, the "Indebtedness"),
Mortgagor has created a security interest in and mortgaged,  warranted, granted,

                                       2
<PAGE>

bargained, sold, conveyed, assigned, pledged, transferred and set over, and does
by these presents create a security  interest in and MORTGAGE,  WARRANT,  GRANT,
BARGAIN, SELL, CONVEY,  ASSIGN,  PLEDGE,  TRANSFER AND SET OVER unto Lender, its
successors and assigns forever, WITH MORTGAGE COVENANTS the following property:

The parcel or parcels of land  described in  Schedules  A-1 through A-4 attached
hereto and by this reference made a part hereof (the "Land");

TOGETHER with the buildings, foundations, structures and improvements (including
fixtures)  now  or  hereafter  located  on or in  the  Land  (collectively,  the
"Improvements");

TOGETHER with all right, title and interest,  if any, of Mortgagor in and to the
streets and roads,  opened or proposed,  abutting the Land, all strips and gores
within or adjoining the Land, the air space and right to use the air space above
the Land,  all rights of ingress and egress to and from the Land, all easements,
rights of way,  reversions,  remainders,  estates,  rights,  titles,  interests,
privileges,  servitudes,  tenements,  hereditaments,  and  appurtenances  now or
hereafter  affecting the Land or the Improvements,  all royalties and rights and
privileges   appertaining   to  the  use  and  enjoyment  of  the  Land  or  the
Improvements,  including all air, lateral support,  streets,  alleys,  passages,
vaults,  drainage,  water, oil, gas and mineral rights,  development rights, all
options to purchase or lease, and all other interests, estates or claims, in law
or in  equity,  which  Mortgagor  now has or  hereafter  may  acquire in or with
respect to the Land or the Improvements (collectively, the "Appurtenances");

The Land, the  Improvements  and the  Appurtenances  are  hereinafter  sometimes
collectively referred to as the "Premises";

TOGETHER  with all  equipment,  fittings,  furniture,  furnishings,  appliances,
apparatus, and machinery in which Mortgagor now or hereafter has a possessory or
title  interest and now or  hereafter  installed in or located upon the Premises
and all building materials, supplies and equipment now or hereafter delivered to
the  Premises  and  intended to be  installed  therein or located  thereon;  all
fixtures,  other goods and  personal  property  of whatever  kind and nature now
contained on or in or  hereafter  placed on or in the Premises and used or to be
used in connection with the letting or operation thereof, in which Mortgagor now
has or hereafter  may acquire a possessory or title  interest (but  specifically
excluding  inventory) and all renewals or  replacements  of any of the foregoing
property or articles in substitution thereof (collectively, the "Equipment");

TOGETHER  with all  right,  title and  interest  of  Mortgagor  in and under all
present or future accounts, escrows, documents,  instruments, chattel paper, and
general intangibles, as the foregoing terms are defined in the Code (hereinafter
defined),  and all contract  rights,  including,  without  limitation,  casualty
insurance  policies and liability  insurance  policies  (irrespective of whether
such  policies are required to be obtained or  maintained  in force  pursuant to
this Mortgage or other Loan Documents),  trade names, trademarks,  servicemarks,
logos, copyrights,  goodwill, franchises, books, records, plans, specifications,
permits,  licenses,  approvals,  actions  and  causes  of  action  which  now or
hereafter  relate  to,  are  derived  from or are  used in  connection  with the
Premises or the use, operation,  maintenance,  occupancy or enjoyment thereof or
the  conduct  of  any  business  or  activities   thereon   (collectively,   the
"Intangibles");

                                       3
<PAGE>

TOGETHER  with all  right,  title and  interest  of  Mortgagor  in and under all
leases, lettings, tenancies and licenses of the Premises or any part thereof now
or  hereafter  entered  into  and  all  amendments,   extensions,  renewals  and
guaranties  thereof,  all security therefor,  and all moneys payable thereunder,
including without limitation,  the leases described on Schedules B-1 through B-4
attached  hereto and by this  reference  made a part hereof  (collectively,  the
"Leases");

TOGETHER  with  all  rents,  income,  accounts,  receivables,  issues,  profits,
security  deposits and other benefits to which Mortgagor may now or hereafter be
entitled from the  Premises,  the  Equipment or the  Intangibles  or under or in
connection with the Leases (collectively, the "Property Income"); and

TOGETHER with all proceeds,  judgments, claims, compensation,  awards of damages
and settlements  pertaining to or resulting from or in lieu of any  condemnation
or taking of the Mortgaged  Property by eminent domain (including any additional
amounts  received by Mortgagor  under the Leases in the event of a taking by the
City  of  New  York  or  any  of  its  agencies  or  instrumentalities,  or  the
Metropolitan  Transportation Authority, or by the State of New York on behalf of
the Metropolitan Transportation Authority) or any casualty loss or damage to the
Mortgaged  Property,  the Leases or the Property Income, and including also, the
right to assert,  prosecute  and settle  claims  arising out of or pertaining to
such  condemnation or taking or such casualty loss under insurance  policies (or
any self-insurance  maintained in lieu of such insurance  policies) and to apply
for and receive  payments of proceeds  under such  insurance  policies  (and any
payments in respect of any  self-insurance  maintained in lieu of such insurance
policies) and in any condemnation or taking,  the right to apply for and receive
all refunds with respect to the payment of property  taxes and  assessments  and
all  other  proceeds  from the  conversion,  voluntary  or  involuntary,  of the
Mortgaged Property, the Leases or the Property Income, or any part thereof, into
cash or  liquidated  claims.  Collectively,  all of the  foregoing,  are  herein
referred  to as the  "Proceeds,"  and  are  subject  to the  provisions  of this
Mortgage including without limitation Sections 2.04 and 2.05

The Equipment, the Intangibles, the Leases, the Property Income and the Proceeds
are hereinafter  sometimes  collectively  referred to as the  "Collateral."  The
Premises and the Collateral are hereinafter  sometimes  collectively referred to
as the "Mortgaged Property."

TO HAVE AND TO HOLD the Mortgaged  Property,  whether now or hereafter existing,
together  with  all  the  rights,  privileges  and  appurtenances  to  the  same
belonging,  and with the possession and right of possession thereof, unto Lender
and  its  successors  and  assigns  forever,  upon  the  terms,  provisions  and
conditions hereinafter set forth, and each Mortgagor does hereby bind itself and
its  successors,  legal  assigns,  representatives,  and to warrant  and forever
defend all and singular the Mortgaged  Property  unto Lender and its  successors
and assigns,  against every person whomsoever  lawfully claiming or to claim the
same or any part thereof.

For purposes of the MORTGAGE,  WARRANT,  GRANT, BARGAIN,  SELL, CONVEY,  ASSIGN,
PLEDGE,  TRANSFER AND SET OVER made to Lender herein,  147th Avenue is the owner
and  mortgagor  of the  Mortgaged  Property  located  on the Land  described  in
Schedule A-1 attached  hereto,  Rockaway Beach is the owner and mortgagor of the
Mortgaged  Property  located on the Land  described  in  Schedule  A-2  attached
hereto, 24th Avenue is the owner and mortgagor of the Mortgaged Property located

                                       4
<PAGE>

on the Land  described in Schedule A-3  attached  hereto,  and Guy Brewer is the
owner and mortgagor of the Mortgaged  Property  located on the Land described in
Schedule A-4 attached hereto.

                                    ARTICLE I
                               Definition of Terms

     As used in this  Mortgage,  the  terms  set  forth  below  shall  have  the
following meanings:

     "Advances" - All sums,  amounts or expenses  advanced or paid and all costs
incurred by Lender,  as provided in this Mortgage or in any other Loan Document,
upon failure of Mortgagor to pay or perform any obligation or covenant contained
herein or in such other Loan Document.

     "Assignment"  - The Assignment of Leases and Rents from Mortgagor to Lender
of even date herewith.

     "Bankruptcy Proceeding" - Any proceeding,  action, petition or filing under
the Federal Bankruptcy Code or any similar state or federal law now or hereafter
in  effect  relating  to  bankruptcy,   reorganization  or  insolvency,  or  the
arrangement or adjustment of debts.

     "Business  Day" - Any day  other  than a  Saturday,  Sunday or other day on
which national banks in the State are not open for business.

     "Code" - The Uniform Commercial Code of the State.

     "Default Rate" - The per annum interest rate equal to the lesser of (i) the
highest rate  permitted by  applicable  law, or (ii) the sum of two percent (2%)
plus the Interest Rate (as defined in the Mortgage Notes).

     "Environmental  Law" - Any and  all  federal,  state,  local,  and  foreign
statutes,  laws, regulations,  ordinances,  rules,  judgments,  orders, decrees,
permits, concessions,  grants, franchises,  licenses, agreements or governmental
restrictions  relating to pollution and the protection of the environment or the
release  of any  materials  into the  environment,  including  those  related to
Hazardous Materials.

     "Event of  Default"  - Any one or more of the events  described  in Section
4.01.

     "Hazardous Material" - Any and all pollutants, toxic or hazardous wastes or
other  substances that might pose a hazard to health and safety,  the removal of
which  is  required  or  the  generation,   manufacture,  refining,  production,
processing,  treatment,  storage,  handling,   transportation,   transfer,  use,
disposal,  release,  discharge,  spillage,  seepage or filtration of which is or
shall be  restricted,  prohibited or penalized by any  applicable  law including
asbestos,   urea  formaldehyde  foam  insulation,   polychlorinated   biphenyls,
petroleum and petroleum products.

                                       5
<PAGE>

     "Lender" - ING USA Annuity and Life Insurance  Company,  ING Life Insurance
and Annuity  Company,  Reliastar  Life  Insurance  Company and Security  Life of
Denver Insurance Company,  the mortgagees  identified as such on the Cover Sheet
and in  the  preamble  of  this  Mortgage,  and  their  successors  and  assigns
(including any other holders from time to time of the Note).

     "Losses" - Claims, suits, liabilities (including without limitation, strict
liabilities), actions, proceedings,  obligations, debts, damages, losses, costs,
fines, penalties,  charges, fees, expenses,  judgments,  awards, amounts paid in
settlement,   punitive  damages,  foreseeable  and  unforeseeable  consequential
damages of whatever  kind or nature  (including  but not  limited to  reasonable
attorneys' fees and other costs of defense).

     "Permitted  Encumbrances" - The liens and security interest created by this
Mortgage and the other Loan Documents and those exceptions to title set forth in
Schedule C-1 through C-4 to this Mortgage.

     "State" - The State of New York.

                                   ARTICLE II
                             Covenants of Mortgagor

     Mortgagor covenants,  warrants, represents and agrees with and to Lender as
follows:

     Section 2.01.  Payment of the Indebtedness.  Mortgagor shall punctually pay
the  Indebtedness  at the times and in the manner  provided in the Mortgage Note
and the other  Loan  Documents,  all in  lawful  money of the  United  States of
America.

     Section 2.02. Title to the Mortgaged Property.

(a)  Mortgagor  has good and  indefeasible  title  to the  applicable  Mortgaged
     Property,  free and  clear  of  liens  and  encumbrances  except  Permitted
     Encumbrances.

(b)  Mortgagor  has full power and lawful  authority to encumber the  applicable
     Mortgaged Property in the manner and form herein set forth.

(c)  This  Mortgage  is and will  remain  a valid  and  enforceable  lien on and
     security interest in the Mortgaged Property.

(d)  Mortgagor will preserve such title and will forever  warrant and defend the
     same and the validity and priority of the lien hereof to Lender against all
     claims whatsoever.

     Section 2.03.  Maintenance of the Mortgaged Property.  Mortgagor shall (or,
to the  extent  that any Lease  requires  the  tenant  to assume  responsibility
therefor,  Mortgagor  shall use good faith efforts to enforce the  provisions of
such Lease that require the tenant to) maintain or cause the Mortgaged  Property
to be  maintained  in good and safe  condition,  working  order and repair,  and

                                       6
<PAGE>

comply with all existing and future federal,  state and local laws,  ordinances,
rules and regulations  and court orders  affecting or that may be interpreted as
affecting the  Property,  including the  Americans  with  Disabilities  Act, all
Environmental  Laws  and  all  zoning,  subdivision,  land  use,  environmental,
traffic, fire, building, and occupational safety and health rules,  regulations,
codes,  acts and statutes to which it is subject.  Mortgagor shall not,  without
the prior consent of Lender: (i) change the use of the Mortgaged Property;  (ii)
cause or permit the use or occupancy of any part of the Mortgaged Property to be
discontinued  if such  discontinuance  would  violate  any  zoning or other law,
ordinance  or  regulation;   (iii)  consent  to  any  zoning   reclassification,
modification or restriction  materially  affecting the Mortgaged Property;  (iv)
threaten,  commit  or permit  any  waste,  structural  or  material  alteration,
demolition or removal of the Mortgaged Property or any portion thereof (provided
that the  Equipment  may be removed if replaced  with similar  items of equal or
greater  value);or  (v) take any  steps  whatsoever  to  convert  the  Mortgaged
Property,  or any portion  thereof,  to a  condominium  or  cooperative  form of
ownership, if any such action shall result in: (A) a reduction of the fixed rent
which the  tenant is  obligated  to pay under  the  applicable  Lease,  or (B) a
termination  of the  applicable  Lease.  Lender  acknowledges  that a tire  shop
structure  located at 85-01 24th Avenue,  East Elmhurst has been damaged and may
be  demolished  and not  replaced  by the  tenant or  subtenant  under the Lease
applicable to such Mortgaged Property.

     Section  2.04.  Insurance;  Casualty.  (a)  Mortgagor  shall use good faith
efforts  cause all tenants and  subtenants  to maintain all  insurance  required
pursuant to the terms of the Leases and shall provide  Lender with copies of all
insurance certificates and other evidence of insurance received from tenants and
subtenants. Lender acknowledges that the tenants and subtenants under the Leases
listed in Schedules B-1 through B-4 are permitted to provide  self-insurance and
are  so  doing.  Mortgagor  shall  maintain  commercially  reasonable  insurance
determined by Mortgagor.  The insurance identified on Schedule D is satisfactory
to Lender.  Lender may notify any and all insurers  under casualty and liability
insurance policies relating to the Mortgaged Property that Lender has a security
interest  pursuant to the  provisions of this Mortgage in and to such  insurance
policies and any proceeds  thereof,  and that any payments under those insurance
policies are to be made directly to Lender.

     (b)  Mortgagor  shall  promptly  notify Lender in the event of any casualty
affecting  the Mortgaged  Property.  Mortgagor  shall not adjust,  compromise or
settle any claim for  casualty  Proceeds  without  the prior  consent of Lender,
which shall not be  unreasonably  withheld,  conditioned or delayed.  So long as
such casualty does not result in the reduction of the fixed rent that the tenant
is obligated to pay under the applicable  Lease, (i) Mortgagor shall be entitled
to collect, receive and retain any casualty proceeds and (ii) no portion thereof
shall be applied to any of the  Indebtedness.  If, as a result of any  casualty,
any  tenant  reduces  the fixed rent that it is paying  under any Lease,  Lender
shall  have the  option,  in its sole  discretion,  to apply  and/or to  require
Mortgagor to apply any Proceeds that Mortgagor is not required to make available
to the  tenants  under  the  terms of the  Leases  (less  any cost to  Lender of
recovering and paying out such Proceeds,  including reasonable  attorneys' fees,
costs and expenses) (the  "Available  Casualty  Proceeds") to the payment of the
Indebtedness or to allow all or a portion of such Available Casualty Proceeds to
be used for the repair, restoration and rebuilding of the Mortgaged Property. In
the event that any Available Casualty Proceeds are required by Lender to be used
toward  payment of the  Indebtedness,  no  Make-Whole  Amount (as defined in the
Notes)  shall be due or  payable  on such  payment.  In the event  that any such

                                       7
<PAGE>

Available  Casualty  Proceeds are made  available  to  Mortgagor  for repair and
restoration of the Mortgaged Property,  the parties shall establish a reasonable
mechanism  for  Lender  to  provide  oversight  as to the  distribution  of such
Available Casualty  Proceeds.  In the event that Lender does not require 100% of
such  Available  Casualty  Proceeds  be  applied  either  toward  payment of the
Indebtedness  and/or toward repair,  restoration and rebuilding of the Mortgaged
Property, the provisions of Section 4.3 of the Loan Agreement shall govern.

     Section 2.05.  Condemnation.  Mortgagor shall notify Lender promptly of the
actual or threatened  commencement of any  proceedings  for the  condemnation or
taking of the Mortgaged  Property or any portion  thereof,  and shall deliver to
Lender  copies of any and all material  papers  served in  connection  with such
proceedings.  Mortgagor shall not adjust,  compromise,  settle or enter into any
agreement with respect to such proceedings  without the prior consent of Lender,
which shall not be  unreasonably  withheld,  conditioned or delayed.  So long as
such condemnation, or purchase in lieu thereof, of the Mortgaged Property or any
portion  thereof,  does not result in the  reduction  of the fixed rent that the
tenant is obligated to pay under the applicable  Lease,  (i) Mortgagor  shall be
entitled to collect,  receive and retain up to  $5,000,000  of any Proceeds from
such condemnation,  or purchase in lieu thereof, that are not otherwise required
by the Lease to be made available to the tenant under the Lease or to be applied
to the repair or restoration of the Mortgaged Property ("Available  Condemnation
Proceeds"),  and (ii)  Lender may, in Lender's  sole  discretion,  apply  and/or
require Mortgagor to apply any such Available Condemnation Proceeds in excess of
$5,000,000  toward  the  payment  of  the  Indebtedness  or  to  the  repair  or
restoration of the Mortgaged Property.  If, as a result of any condemnation,  or
purchase in lieu thereof,  of the Mortgaged Property,  or any part thereof,  any
tenant reduces, or is entitled to reduce, the fixed rent that it is paying under
any Lease, (x) Lender shall be entitled to collect and receive the Proceeds from
such  condemnation or purchase,  give proper receipts and acquittances  therefor
and, in Lender's sole discretion, apply and/or to require Mortgagor to apply the
Allocable Portion of any Available  Condemnation  Proceeds toward the payment of
the  Indebtedness or to the repair or restoration of the Mortgaged  Property and
(y)  Mortgagor  shall be  entitled  to  receive  the  balance  of any  Available
Condemnation  Proceeds  in excess of such  Allocable  Portion  (less any cost to
Lender  of  recovering  and  paying  out  such  Proceeds,  including  reasonable
attorneys'  fees,  costs  and  expenses  allocable  to  inspecting  any  repair,
restoration or rebuilding work and the plans and  specifications  therefor).  In
the event that any Available  Condemnation Proceeds are required by Lender to be
used toward payment of the  Indebtedness,  no Make-Whole Amount shall be due and
payable on such payment. In the event that any Available  Condemnation  Proceeds
are made  available to Mortgagor  for repair and  restoration  of the  Mortgaged
Property,  the parties  shall  establish a  reasonable  mechanism  for Lender to
provide  oversight  as  to  the  distribution  of  such  Available  Condemnation
Proceeds.  In the event  that  Lender  does not  require  100% of any  Available
Condemnation  Proceeds  be applied  either  toward  payment of the  Indebtedness
and/or toward repair,  restoration and rebuilding of the Mortgaged Property, the
provisions of Section 4.3 of the Loan Agreement shall govern.

     The "Allocable Portion" of any Available Condemnation Proceeds shall be the
portion  of such  Proceeds  that is  equal  to the  amount,  if  any,  by  which
Consolidated  Debt (as  defined in the Loan  Agreement)  would be required to be
reduced  (assuming  that  prior  to such  reduction,  the  aggregate  amount  of
Non-Mortgage  Loans  outstanding  was equal to the full  Aggregate  Non-Mortgage

                                       8
<PAGE>

Commitment  Amount (as such terms are  defined in the Loan  Agreement))  so that
after giving  effect to such  reduction  and to any reduction in the fixed rents
payable  under any Lease as a result of any  condemnation,  or purchase in lieu,
the Debt Service  Coverage Ratio (as defined in the Loan Agreement) for the most
recently completed period of four consecutive  Fiscal Quarters  (calculated on a
pro forma basis,  assuming both such reduction in such assumed Consolidated Debt
and such reduction in fixed rents under any Lease  throughout such period) would
be the same as the Debt  Service  Coverage  Ratio for such  period  before  such
reductions  (but  assuming  that the  Aggregate  Amount  of  Non-Mortgage  Loans
outstanding  throughout  such  period  had  been  equal  to the  full  Aggregate
Non-Mortgage Commitment Amount).

     Section  2.06.  Impositions.  Mortgagor  shall (or,  to the extent that any
Lease requires the tenant to assume responsibility therefor, Mortgagor shall use
good faith  efforts to enforce  the  provisions  of such Lease that  require the
tenant to) pay or cause to be paid  before any fine,  penalty,  interest or cost
may be added  thereto,  and  shall  not  enter  into  any  agreement  which  may
materially  and  negatively  impact the  interests  of the Lender to defer,  any
taxes,  or  payments in lieu of taxes of every kind and  nature,  sewer,  rents,
charges for water,  for setting or repairing  meters and for all other utilities
serving the Mortgaged Property, and assessments,  levies, inspection and license
fees and all other charges imposed or assessed against the Mortgaged Property or
any portion  thereof.  Mortgagor shall not suffer or permit the joint assessment
of the  Mortgaged  Property  with any other real or personal  property  owned by
Mortgagor. Mortgagor shall (or, to the extent that any Lease requires the tenant
to assume  responsibility  therefor,  Mortgagor  shall use good faith efforts to
enforce the  provisions  of such Lease that  require the tenant to) pay when due
all claims and demands of mechanics,  materialmen,  laborers and others that, if
unpaid, might result in a lien on the Mortgaged Property; however, Mortgagor may
contest the validity of such claims and demands  under  commercially  reasonable
standards.

     Section 2.07. Payment of Liens. Mortgagor shall (or, to the extent that any
Lease requires the tenant to assume responsibility therefor, Mortgagor shall use
good faith  efforts to enforce  the  provisions  of such Lease that  require the
tenant to) pay or cause to be paid when due all  payments  and charges due under
or in connection with any liens and  encumbrances  on and security  interests in
the Mortgaged  Property or any portion thereof,  all rents and charges under any
ground  leases and other leases  forming a part of the Mortgaged  Property,  and
(subject  to Section  2.06) all claims and  demands of  mechanics,  materialmen,
laborers and others that, if unpaid, might result in or permit the creation of a
lien on the  Mortgaged  Property  or any  portion  thereof,  and shall cause the
prompt  (but in no  event  later  than  30  days  after  imposition),  full  and
unconditional  discharge  of all  liens  imposed  on or  against  the  Mortgaged
Property or any portion thereof.  If Mortgagor fails to make or cause to be made
any such payment or if a lien attaches to the Mortgaged  Property or any portion
thereof,  Lender  may (but  shall  not be  obligated  to) make such  payment  or
discharge such lien and Mortgagor shall reimburse  Lender on demand for all such
Advances.

     Section 2.08. Costs of Defending and Upholding the Lien.  Lender may, after
notice to  Mortgagor  and  failure  to appear  or  defend  by  Mortgagor  for an
unreasonable  period of time, (a) appear in and defend any action or proceeding,
in the name and on behalf of either  Lender  or  Mortgagor,  in which  Lender is
named or which Lender in its sole discretion determines may adversely affect the
Mortgaged Property,  this Mortgage,  the lien hereof or any other Loan Document;

                                       9
<PAGE>

and (b) institute any action or proceeding  which Lender in its sole  discretion
determines  should be  instituted  to  protect  its  interest  in the  Mortgaged
Property or its rights under this Mortgage or any other Loan Document including,
without limitation,  foreclosure proceedings. Mortgagor agrees to bear and shall
pay or  reimburse  Lender on demand for all  Advances  and  expenses  (including
reasonable attorneys' fees) relating to or incurred by Lender in connection with
any such action or proceeding.

     Section 2.09. Costs of Enforcement.  Mortgagor agrees to bear and shall pay
or  reimburse  Lender  on  demand  for  all  Advances  and  expenses  (including
reasonable  attorneys' and appraisers' fees and the expenses and reasonable fees
of any receiver or similar  official) of or incidental to the  collection of the
Indebtedness,  any foreclosure of this Mortgage or any other Loan Document,  any
enforcement,  compromise or settlement of this Mortgage, any other Loan Document
or the  Indebtedness,  or any  defense or  assertion  of the rights or claims of
Lender in respect of any thereof, by litigation or otherwise.

     Section 2.10.  Interest on Advances and Expenses.  All Advances made at any
time by Lender  pursuant to the  provisions  of this  Mortgage or the other Loan
Documents or under  applicable  law shall be secured by this Mortgage as part of
the  Indebtedness,  with equal rank and priority.  All such Advances  shall bear
interest at the Default Rate from the date that each such Advance is made to the
date of repayment  and all Advances  with  interest  thereon shall be payable to
Lender on demand.

     Section  2.11.  Indemnification.  Except  arising  from  acts or  omissions
attributable to Lender,  Mortgagor shall indemnify and hold Lender harmless from
and  against  and  reimburse  Lender for all Losses  which may be imposed  upon,
asserted against,  or incurred or paid by Lender (a) by reason of, on account of
or in connection with any act or occurrence  relating to the Mortgaged  Property
or any bodily injury,  death, other personal injury or property damage occurring
in or upon  the  Premises  from any  cause  whatsoever,  (b) as a result  of the
failure of  Borrower  to perform  any of its  obligations  under any of the Loan
Documents  beyond  applicable  cure and grace periods,  or (c) on account of any
transaction  otherwise arising out of or in any way connected with the Mortgaged
Property, this Mortgage or the Indebtedness.

     Section 2.12. Prohibition Against Conveyances and Encumbrances.  Except for
the  Leases  or as  expressly  permitted  by the Loan  Agreement  or other  Loan
Documents, Mortgagor shall not, without the prior written consent of Lender, (i)
directly or indirectly sell, transfer,  convey,  mortgage,  pledge or assign any
interest  in  the  Mortgaged   Property  or  any  part  thereof  (including  any
membership, partnership or any other ownership interest in Assignor, any general
partner of  Mortgagor  or any  general  partner of any such  general  partner of
Mortgagor);  (ii) other than this  Mortgage,  the  Assignment  and the Permitted
Encumbrances,  encumber,  alienate,  grant a lien or grant any other interest in
the  Mortgaged   Property  or  any  part  thereof   (including  any  membership,
partnership or other  ownership  interest in Assignor),  whether  voluntarily or
involuntarily;  or (iii)  enter into any  easement or other  agreement  granting
rights in or restricting the use or development of the Mortgaged Property.

     Section 2.13. Estoppel  Certificates.  Within 10 Business Days of a request
by  Lender,  Borrower  shall  furnish  to  Lender  a duly  acknowledged  written
statement  confirming the amount of the  outstanding  Indebtedness  and maturity

                                       10
<PAGE>

date of the  Mortgage  Notes,  the date to which  interest  has been  paid,  and
whether to  Borrower's  knowledge  and belief,  any  offsets or  defenses  exist
against the Indebtedness.  If any such offsets or defenses are alleged to exist,
the nature  thereof shall be set forth in detail.  Borrower  shall also use good
faith efforts to furnish to Lender within 30 days of its request therefor tenant
estoppel  letters from such  tenants of the Premises as Lender may require,  but
such requests shall not be made more often than once in a calendar year period.

     Section    2.14.    Assignment    of   Leases    and    Property    Income.

(a)  Assignment.  Mortgagor  acknowledges  and confirms that it has executed and
     delivered  to  Lender  the  ----------  Assignment,   intending  that  such
     instrument  create a present,  absolute  assignment to Lender of the Leases
     and the Property  Income.  Without  limiting  the intended  benefits or the
     remedies  provided  under the  Assignment  ,  Mortgagor  hereby  assigns to
     Lender,  as  further  security  for the  Indebtedness,  the  Leases and the
     Property Income.  Upon the occurrence of an Event of Default,  Lender shall
     be  entitled  to  exercise  any  or all of  the  remedies  provided  in the
     Assignment  and in Section 4.02  hereof,  including,  ------------  without
     limitation,  the right to have a receiver  appointed.  If any  conflict  or
     inconsistency  exists between the assignment of the Property Income and the
     Leases in this Mortgage and the absolute  assignment of the Property Income
     and the  Leases  in the  Assignment,  the  terms  of the  Assignment  shall
     control.

(b)  No  Merger  of  Estates.  So long as any part of the  Indebtedness  secured
     hereby remain unpaid and undischarged, the fee and leasehold estates to the
     Mortgaged Property shall not merge, but shall remain separate and distinct,
     notwithstanding the union of such estates either in Mortgagor,  Lender, any
     lessee or any third party by purchase or otherwise.

     Section 2.15. Environmental Matters.

(a)  Mortgagor  shall  not,  and shall use good  faith  efforts to not allow any
     tenant to, install, use, generate,  manufacture,  refine, transport, store,
     handle,  dispose,  transfer,  produce  or  process  on,  under or about the
     Premises,  any Hazardous  Materials,  except in compliance  with applicable
     Environmental Laws.

(b)  Mortgagor  shall keep and  maintain,  and shall use good  faith  efforts to
     cause all tenants to keep and maintain,  the Premises in  compliance  with,
     and  shall  not  cause  or  permit  the  Premises  to be in  violation  of,
     applicable Environmental Laws.

(c)  Mortgagor  shall  promptly  provide  notice to Lender of, and copies of all
     relevant materials related to :

     (i)  any proceeding, investigation or inquiry commenced by any governmental
          authority  with respect to the presence of any Hazardous  Material on,
          under or about the Premises or the migration of any Hazardous Material
          to or from adjoining property;

                                       11
<PAGE>

     (ii) all  claims  made  or  threatened  by any  person  or  entity  against
          Mortgagor,  any other  party  occupying  the  Premises  or any portion
          thereof,  or the  Premises,  relating to any loss or injury  allegedly
          resulting from any Hazardous Material; and

     (iii) the  discovery of any  occurrence  or condition on the Premises or on
          any real  property  adjoining or in the vicinity of the  Premises,  of
          which Mortgagor  becomes aware,  which might cause the Premises or any
          portion thereof to be in violation of any Environmental Law or subject
          to any  restriction on ownership,  occupancy,  transferability  or use
          under  any   Environmental   Law   (collectively,   an  "Environmental
          Violation").

(d)  Remedial Work. If any investigation, site monitoring, containment, cleanup,
     removal,   restoration   or  other   remediation  of  any  kind  or  nature
     (collectively,  the  "Remedial  Work") is  required  under  any  applicable
     Environmental   Law,  Mortgagor  shall  promptly  commence  and  diligently
     prosecute to  completion  all such  Remedial  Work,  provided  that, to the
     extent that any tenant under any of the Leases is responsible  for any such
     matters,  Mortgagor shall be deemed to be in compliance with this provision
     so long as Mortgagor is using good faith efforts to enforce the  applicable
     provisions of the Leases .

                                   ARTICLE III
                               Security Agreement

     Section 3.01.  Security  Interest.  This  Mortgage  constitutes a "Security
Agreement"  on  personal  property  within  the  meaning  of the Code and  other
applicable law. To this end,  Mortgagor,  as further security for the payment of
the  Indebtedness  and in  addition  to all the  rights and  remedies  otherwise
available to Lender under this Mortgage and the other Loan Documents,  grants to
Lender a security interest, under the Code, in and to the Mortgaged Property and
all proceeds thereof.  Upon the occurrence of an Event of Default,  Lender shall
have,  in addition to all the other  rights and remedies  allowed by  applicable
law, the rights and  remedies of a secured  party under the Code as in effect at
that time.  Mortgagor  further agrees that the security  interest created hereby
also secures all  expenses of Lender  (including  reasonable  expenses for legal
services of every kind, and cost of any insurance, and payment of taxes or other
charges) incurred in or incidental to, the custody, care, sale or collection of,
or realization  upon, any of the property  secured hereby or in any way relating
to the  enforcement  or  protection  of the  rights  of  Lender  hereunder.  The
Mortgagor's  organization  numbers are  ___________,  __________,  _______,  and
___________.

     Section 3.02. Financing Statements.  Mortgagor shall execute and/or deliver
to Lender such financing  statements and further  assurances as Lender may, from
time to time,  consider  reasonably  necessary  to create,  perfect and preserve
Lender's  security  interest  hereunder,  and Lender may prepare  any  financing
statements and cause such financing statements to be recorded and filed, at such
times and places as may be required or  permitted  by law to so create,  perfect
and preserve such security interest.  Each Mortgagor is organized under the laws
of the  State  and  Mortgagor's  chief  executive  office is in the State at the
address set forth in the first paragraph of this Mortgage.

                                       12
<PAGE>

     Section  3.03.  Fixture  Filing.  This  Mortgage  shall also  constitute  a
"fixture  filing"  for the  purposes of the Code  against  all of the  Mortgaged
Property which is or is to become fixtures.

                                   ARTICLE IV
                              Default and Remedies

     Section 4.01. Events of Default.  Each of the following shall constitute an
Event of Default hereunder:

(a)  an Event of Default should occur under any of the Mortgage Notes;

(b)  default in the due  observance  or  performance  of any term,  covenant  or
     condition contained in Section 2.12 of this Mortgage;

(c)  default in the due observance or perfomance of any other term,  covenant or
     condition  contained  in this  Mortgage  and such  default is not  remedied
     within  30 days  after  the  earlier  of  Mortgagor  (x)  obtaining  actual
     knowledge of such default and (y) receiving  written notice of such default
     from Lender; or

(c)  an Event of Default should occur under the Loan Agreement.

     Section 4.02. Remedies.  Upon the occurrence of an Event of Default, Lender
may, at Lender's election, exercise any or all of the following rights, remedies
and recourses:

(a)  Acceleration.  Declare the  Indebtedness to be immediately due and payable,
     without  further  notice,   presentment,   protest,  notice  of  intent  to
     accelerate,  notice  of  acceleration,  demand  or  action  of  any  nature
     whatsoever  (each  of which  hereby  is  expressly  waived  by  Mortgagor),
     whereupon the same shall become immediately due and payable.

(b)  Entry  on  Mortgaged  Property.  Enter  the  Mortgaged  Property  and  take
     exclusive  possession  thereof  and  of all  books,  records  and  accounts
     relating thereto, subject to any rights of tenants. If Mortgagor remains in
     possession of the Mortgaged  Property  after the  occurrence of an Event of
     Default and prior to the acceptance by Lender of a cure thereof and without
     Lender's  prior written  consent,  Lender may invoke any legal  remedies to
     dispossess Mortgagor.

(c)  Operation of Mortgaged  Property.  Subject to any rights of tenants,  hold,
     lease,  develop,  manage,  operate or otherwise use the Mortgaged  Property
     upon  such  terms  and  conditions  as  Lender  may in its sole  discretion
     determine (including without limitation,  making such repairs, alterations,
     additions and improvements and taking other actions,  from time to time, as
     Lender deems  necessary or  desirable),  and apply all Property  Income and
     other amounts  collected by Lender in  connection  therewith in such manner
     and at such  times as  Lender  shall  determine  in its  discretion  to the
     payment of the  Indebtedness and the interest thereon and/or to the payment

                                       13
<PAGE>

     of any other sums  required to be paid by Mortgagor  hereunder or under any
     other Loan Document.

     (d)   Foreclosure  and  Sale.   Institute   proceedings  for  the  complete
     foreclosure of this Mortgage,  in which case the Mortgaged  Property may be
     sold for cash or credit in one or more parcels. With respect to any notices
     required  or  permitted  under the  Code,  Mortgagor  agrees  that ten (10)
     Business   Days'  prior  written   notice  shall  be  deemed   commercially
     reasonable.  At any such sale by virtue of any judicial  proceedings or any
     other legal right, remedy or recourse, the title to and right of possession
     of any  such  property  shall  pass to the  purchaser  thereof,  and to the
     fullest  extent  permitted  by  law,  Mortgagor  shall  be  completely  and
     irrevocably divested of all of its right, title, interest, claim and demand
     whatsoever,  either at law or in equity,  in and to the  property  sold and
     such  sale  shall  be a  perpetual  bar both at law and in  equity  against
     Mortgagor,  and against all other persons claiming or to claim the property
     sold or any part thereof,  by, through or under Mortgagor.  Lender may be a
     purchaser at such sale and if Lender is the highest bidder,  may credit the
     portion of the purchase  price that would be  distributed to Lender against
     the Indebtedness in lieu of paying cash.

     (e) Receiver.  Make application to a court of competent  jurisdiction  for,
     and obtain from such court as a matter of strict  right and without  notice
     to Mortgagor or regard to the  adequacy of the  Mortgaged  Property for the
     repayment  of  the  Indebtedness,  the  appointment  of a  receiver  of the
     Mortgaged Property, and Mortgagor irrevocably consents to such appointment.
     Any such  receiver  shall have all the usual powers and duties of receivers
     in similar cases,  including the full power to rent, maintain and otherwise
     operate the  Mortgaged  Property  upon such terms as may be approved by the
     court,  and shall  apply such  Property  Income in such  manner and at such
     times as Lender  shall  determine in its  discretion  to the payment of the
     Indebtedness  and the interest  thereon  and/or to the payment of any other
     sums  required to be paid by  Mortgagor  hereunder  or under any other Loan
     Document.

     (f) Code.  Exercise  any and all rights and  remedies  granted to a secured
     party  upon  default  under  the  Code,  including,  without  limiting  the
     generality  of the  foregoing:  (i) the  right  to take  possession  of any
     personalty or any part thereof,  and to take such other  measures as Lender
     may deem  necessary  for the  care,  protection  and  preservation  of such
     personalty,  and  (ii)  request  Lender  at its  expense  to  assemble  the
     personalty and make it available to Lender at a convenient place acceptable
     to Lender.  Any notice of sale,  disposition  or other  intended  action by
     Lender with respect to the personalty  sent to Mortgagor in accordance with
     the provisions hereof at least ten (10) Business Days prior to such action,
     shall constitute commercially reasonable notice to Mortgagor;

     (g) Other. Exercise all other rights,  remedies and recourses granted under
     the Loan Documents or otherwise available at law or in equity (including an
     action for  specific  performance  of any  covenant  contained  in the Loan
     Documents,  or a judgment on the Notes either  before,  during or after any
     proceeding to enforce this Mortgage).

                                       14
<PAGE>

     Section 4.03.  Separate Sales. The Mortgaged Property may be sold in one or
more parcels and in such manner and order as Lender in its sole discretion,  may
elect;  the  right of sale  arising  out of any  Event of  Default  shall not be
exhausted by any one or more sales.

     Section 4.04.  Remedies  Cumulative,  Concurrent and  Nonexclusive.  Lender
shall have all rights,  remedies and recourses granted in the Loan Documents and
available  at law or equity  (including  the  Code),  which  rights (a) shall be
cumulative  and  concurrent,  (b) may be  pursued  separately,  successively  or
concurrently against Mortgagor or others obligated under the Notes and the other
Loan Documents, or against the Mortgaged Property, or against any one or more of
them,  at the  sole  discretion  of  Lender,  (c) may be  exercised  as often as
occasion  therefore shall arise,  and the exercise or failure to exercise any of
them  shall not be  construed  as a waiver or  release  thereof  or of any other
right,  remedy  or  recourse,  and  (d)  are  intended  to  be,  and  shall  be,
nonexclusive.  No action by Lender in the enforcement of any rights, remedies or
recourses under the Loan Documents or otherwise at law or equity shall be deemed
to cure any Event of Default.

     Section  4.05.  Release of and Resort to  Collateral.  Lender may  release,
regardless  of  consideration  and  without the  necessity  for any notice to or
consent by the holder of any  subordinate  lien on the Mortgaged  Property,  any
part  of the  Mortgaged  Property  without,  as to  the  remainder,  in any  way
impairing, affecting,  subordinating or releasing the lien or security interests
created in or  evidenced by the Loan  Documents or their  stature as a first and
prior lien and security interest in and to the Mortgaged  Property.  For payment
of the  Indebtedness,  Lender may resort to any other security in such order and
manner as Lender may elect.

     Section 4.06.  Waiver of Redemption,  Notice and Marshalling of Assets.  To
the  fullest  extent  permitted  by  law,   Mortgagor  hereby   irrevocably  and
unconditionally  waives  and  releases  (a) all  benefit  that  might  accrue to
Mortgagor by virtue of any present or future  statute of  limitations  or law or
judicial decision exempting the Mortgaged Property from attachment, levy or sale
on execution or providing for any  appraisement,  valuation,  stay of execution,
exemption from civil process,  redemption or extension of time for payment,  (b)
except as otherwise expressly provided in the Loan Documents, all notices of any
Event of Default or of Lender's  election to exercise or its actual  exercise of
any right, remedy or recourse provided for under the Loan Documents, and (c) any
right to a marshalling of assets or a sale in inverse order of alienation.

     Section 4.07. Discontinuance of Proceedings. If Lender shall have proceeded
to invoke any right,  remedy or recourse  permitted under the Loan Documents and
shall thereafter elect to discontinue or abandon it for any reason, Lender shall
have the  unqualified  right to do so and, in such an event,  Mortgagor  and the
Lender  shall  be  restored  to  their  former  positions  with  respect  to the
Indebtedness,  the Obligations,  the Loan Documents,  the Mortgaged Property and
otherwise,  and the  rights,  remedies,  recourses  and  powers of Lender  shall
continue as if the right, remedy or recourse had never been invoked, but no such
discontinuance  or  abandonment  shall waive any Event of Default which may then
exist or the  right of  Lender  thereafter  to  exercise  any  right,  remedy or
recourse under the Loan Documents for such Event of Default.

     Section 4.08. Occupancy After Foreclosure. The purchaser at any foreclosure
sale  pursuant to Section  4.02 shall  become the legal  owner of the  Mortgaged
Property.

15
<PAGE>

     Section 4.09. Additional Advances and Disbursements; Costs of Enforcement.

(a)  If any Event of Default  exists,  Lender shall have the right,  but not the
     obligation,  to cure  such  Event of  Default  in the name and on behalf of
     Mortgagor.  All sums  advanced and expenses  incurred at any time by Lender
     under this Section 4.09 and/or such other  provisions of the Loan Documents
     which  provide  that  Lender is  entitled  to be  reimbursed  therefore  by
     Mortgagor  shall bear  interest  from the date that such sum is advanced or
     expense incurred,  to and including the date of reimbursement,  computed at
     the Default Rate and all such sums,  together with interest thereon,  shall
     be secured by this Mortgage.

(b)  Mortgagor shall pay all expenses (including  reasonable attorneys' fees and
     expenses)  of or  incidental  to the  perfection  and  enforcement  of this
     Mortgage and the other Loan Documents,  or the  enforcement,  compromise or
     settlement  of the  Indebtedness  or any claim under this  Mortgage and the
     other Loan  Documents,  and for the curing  thereof,  or for  defending  or
     asserting the rights and claims of Lender in respect thereof, by litigation
     or otherwise.

     Section 4.10. No Mortgagee in Possession. Neither the enforcement of any of
the remedies  under this Article 4, the  assignment  of the Property  Income and
Leases under Article 2.15, the security interests under Article 3, nor any other
remedies afforded to Lender under the Loan Documents,  at law or in equity shall
cause Lender to be deemed or construed  to be a mortgagee in  possession  of the
Mortgaged  Property,  to  obligate  Lender to lease the  Mortgaged  Property  or
attempt  to do so, or to take any  action,  incur any  expense,  or  perform  or
discharge any obligation,  duty or liability  whatsoever under any of the Leases
or otherwise.

     Section  4.11.  Actions and  Proceedings.  Upon prior  notice to  Borrower,
Lender  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  Lender,  in its
reasonable  discretion,  decide should be brought to protect its interest in the
Mortgaged Property.

                                    ARTICLE V
                                  Miscellaneous

     Section 5.01. Notices.

(a)  All notices and  communications  provided for hereunder shall be in writing
     and sent by (i)  telecopy if the sender on the same day sends a  confirming
     copy of such  notice by  recognized  overnight  delivery  service  (charges
     prepaid),  (ii) certified or registered mail with return receipt  requested
     (postage  prepaid),  or (ii) recognized  overnight  delivery  service (with
     charges prepaid), addressed in all cases to any party hereto at its address
     as stated on the Cover Sheet of this Mortgage, or at such other address and
     person as shall be designated from time to time by Lender or Mortgagor,  as
     the case may be, in a  written  notice  to the  other  party in the  manner
     provided for in this Section 5.01.

(b)  Mortgagor  shall notify  Lender  promptly of the  occurrence  of any of the
     following:  (i) receipt of material notice from any governmental  authority
     relating  to the  Mortgaged  Property;  (ii)  any  material  change  in the

                                       16
<PAGE>

     occupancy of the Mortgaged  Property;  (iii) receipt of any notice from the
     holder of any other lien or security interest in the Mortgaged Property; or
     (iv) commencement of any material  judicial or  administrative  proceedings
     by,  against  or  otherwise  affecting  Mortgagor  or  any  guarantor,  the
     Mortgaged  Property,  or any  entity  controlling,  controlled  by or under
     common control with Mortgagor or any guarantor,  or any other action by any
     creditor thereof as a result of any default under the terms of any loan.

     Section 5.02. Binding  Obligations;  Joint and Several.  The provisions and
covenants  of this  Mortgage  shall run with the  land,  shall be  binding  upon
Mortgagor, its successors and assigns, and shall inure to the benefit of Lender,
its  successors  and  assigns.  If there is more than one  Mortgagor,  all their
obligations and undertakings hereunder are and shall be joint and several.

     Section 5.03.  Captions.  The captions of the sections and  subsections  of
this Mortgage are for convenience only and are not intended to be a part of this
Mortgage and shall not be deemed to modify, explain,  enlarge or restrict any of
the provisions hereof.

     Section 5.04. Further Assurances.  Mortgagor shall do, execute, acknowledge
and deliver,  at its sole cost and expense,  such further acts,  instruments  or
documentation, including additional title insurance policies or endorsements, as
Lender may reasonably  require from time to time to better assure,  transfer and
confirm unto Lender the rights now or hereafter intended to be granted to Lender
under this Mortgage or any other Loan Document.

     Section 5.05. Severability.  If any one or more of the provisions contained
in this  Mortgage  shall  for any  reason  be held  to be  invalid,  illegal  or
unenforceable in any respect,  such invalidity,  illegality or  unenforceability
shall not affect any other  provision of this Mortgage,  but this Mortgage shall
be construed as if such invalid,  illegal or  unenforceable  provision had never
been contained herein.

     Section  5.06.  Mortgagor's  Obligations  Absolute.  All  sums  payable  by
Mortgagor hereunder shall be paid without notice, demand, counterclaim,  setoff,
deduction or defense and without abatement, suspension, deferment, diminution or
reduction,  and the obligations and liabilities of Mortgagor  hereunder shall in
no way be  released,  discharged,  or  otherwise  affected  (except as expressly
provided  herein)  by reason  of:  (a)  except  as  otherwise  provided  in this
Mortgage,  any damage to or destruction of or any condemnation or similar taking
of the  Mortgaged  Property  or any  portion  thereof;  (b) any  restriction  or
prevention  of or  interference  with any use of the  Mortgaged  Property or any
portion  thereof;  (c) any title defect or  encumbrance or any eviction from the
Premises  or any  portion  thereof  by title  paramount  or  otherwise;  (d) any
Bankruptcy  Proceeding relating to Mortgagor,  any general partner of Mortgagor,
or any  guarantor  or  indemnitor,  or any  action  taken  with  respect to this
Mortgage or any other Loan  Document by any trustee or receiver of  Mortgagor or
any such general partner,  guarantor or indemnitor, or by any court, in any such
proceeding;  (e) any claim which Mortgagor has or might have against Lender; (f)
any  default or  failure on the part of Lender to perform or comply  with any of
the terms  hereof or of any other  agreement  with  Mortgagor;  or (g) any other
occurrence whatsoever,  whether similar or dissimilar to the foregoing,  whether
or not Mortgagor shall have notice or knowledge of any of the foregoing.  Except
as  expressly  provided  herein,  Mortgagor  waives all rights now or  hereafter
conferred  by statute or  otherwise  to any  abatement,  suspension,  deferment,

                                       17
<PAGE>

diminution or reduction of any sum secured hereby and payable by Mortgagor.

     Section  5.07.  Amendments.  This  Mortgage  cannot  be  altered,  amended,
modified or discharged  orally and no executory  agreement shall be effective to
modify or discharge it in whole or in part,  unless in writing and signed by the
party against which enforcement is sought.

     Section 5.08.  Other Loan Documents and Schedules.  All of the  agreements,
conditions,  covenants,  provisions and stipulations  contained in the Notes and
the other Loan Documents,  and each of them,  which are to be kept and performed
by Mortgagor are hereby made a part of this Mortgage to the same extent and with
the same force and effect as if they were fully set forth in this Mortgage,  and
Mortgagor  shall  keep  and  perform  the  same,  or  cause  them to be kept and
performed,  strictly in accordance with their respective  terms. The Cover Sheet
and each schedule and rider attached to this Mortgage are integral parts of this
Mortgage  and are  incorporated  herein by this  reference.  In the event of any
conflict  between the provisions of any such schedule or rider and the remainder
of this Mortgage, the provisions of such schedule or rider shall prevail.

     Section 5.09. Legal Construction.

(a)  The  enforcement  of this Mortgage  shall be governed by, and construed and
     interpreted in accordance with, the laws of the State.

(b)  All terms contained herein shall be construed, whenever the context of this
     Mortgage so requires, so that the singular number shall include the plural,
     and the plural the  singular,  and the use of any gender shall  include all
     genders.

   (c) The terms "include" and "including" as used in this Mortgage shall be
     construed as if followed by the phrase "without limitation".

(d)      Any provision of this Mortgage permitting the recovery of attorneys'
fees and costs shall be deemed to include such reasonable fees and
         costs incurred in all appellate proceedings.

     Section 5.10.  Merger. So long as any Indebtedness shall remain unpaid, fee
title to and any other estate in the  Mortgaged  Property  shall not merge,  but
shall be kept separate and distinct,  notwithstanding  the union of such estates
in any person or entity.

     Section  5.11.  Time of the  Essence.  Time shall be of the  essence in the
performance of all obligations of Mortgagor under this Mortgage.

     Section  5.12.   Transfer  of  Loan.  Lender,  in  the  management  of  its
investments or for any other reason,  may, at any time, sell, transfer or assign
the Mortgage Notes,  the Mortgage and the other Loan Documents and the servicing
rights with respect  thereto or grant  participations  therein or issue mortgage
pass-through  certificates or other securities  evidencing a beneficial interest
in the Note, Mortgage and other Loan Documents (collectively,  a "Transfer"). As
part of a Transfer, Lender may forward to each transferee,  assignee,  servicer,
participant  or investor all documents and  information  which Lender now has or
may hereafter acquire relating to the  Indebtedness,  the Loan Documents and the

                                       18
<PAGE>

Mortgaged Property. Mortgagor agrees to cooperate with Lender in connection with
a  Transfer  including,   without  limitation,  the  delivery  of  any  estoppel
certificates required hereunder and such other documents as may be reasonably be
requested by Lender.

     Section 5.13.  Defeasance.  If all of the  Indebtedness  is paid in full in
accordance with the Notes and the other Loan Documents and all of the covenants,
warranties,  conditions,  undertakings  and agreements made in this Mortgage and
the other Loan Documents are fully kept and  performed,  then in that event only
all rights of Lender  under this  Mortgage  and the other Loan  Documents  shall
terminate  and the  Mortgaged  Property  shall become wholly clear of the liens,
grants,  security  interests,  conveyances and assignments  evidenced hereby and
thereby,  and Lender shall release or cause to be released  such liens,  grants,
assignments,  conveyances and security  interests in due form at Borrower's cost
(to the extent  permitted by the law of the State),  and this Mortgage  shall be
void;  provided,  however,  that no provision of this Mortgage or any other Loan
Document  which,  by its  own  terms,  is  intended  to  survive  such  payment,
performance,  and release  (nor the rights of Lender  under any such  provision)
shall be  affected  in any manner  thereby and such  provision  shall,  in fact,
survive.  To the extent  permitted by law, such an  instrument  may describe the
grantee or releasee  as "the person or persons  legally  entitled  thereto"  and
Lender shall not have any duty to determine the rights of persons claiming to be
rightful  grantees or  releasees  of any of the  Mortgaged  Property.  When this
Mortgage  has been  fully  released  or  discharged  by Lender,  the  release or
discharge  hereof shall operate as a release and discharge of the Assignment and
as a reassignment  of all future Leases and Property  Income with respect to the
Mortgaged  Property to the person or persons legally  entitled  thereto,  unless
such release expressly provides to the contrary. At Mortgagor's request,  Lender
will  assign  this  Mortgage  to  Mortgagor's   designee  upon  payment  of  the
Indebtedness.

     Section 5.14. Commercial Property.  Mortgagor represents that this Mortgage
does not encumber real property principally improved or to be improved by one or
more  structures  containing  in the  aggregate  not more  than six  residential
dwelling units, each having its own separate cooking facilities.

     Section 5.15.  Maximum  Principal  Indebtedness.  Notwithstanding  anything
contained herein to the contrary,  the maximum amount of indebtedness secured by
this  Mortgage at execution or which under any  contingency  may become  secured
hereby at any time  hereafter is (a) the principal sum of ONE MILLION AND 00/100
DOLLARS  ($1,000,000.00) plus interest thereon (at such rates as provided for in
the Note or herein,  as  applicable),  plus (b)  amounts  expended  by Lender in
accordance with the terms of this Mortgage after a default, to maintain the lien
of this Mortgage or to protect the property secured by this Mortgage, including,
without limitation, amounts in respect of insurance premiums, real estate taxes,
litigation expenses to prosecute or defend the rights, remedies and lien of this
Mortgage or title to the  property  secured  hereby,  and any costs,  charges or
amounts  to  which  Lender  becomes  subrogated  upon  payment,   whether  under
recognized  principles  of law or equity or under express  statutory  authority,
together with  interest on all the  foregoing  amounts at such rates as provided
for in the Notes or herein, as applicable.

     Section  5.16.   Insurance   Proceeds.   In  the  event  of  any  conflict,
inconsistency  or  ambiguity  between the  provisions  of this  Mortgage and the
provisions  of  subsection 4 of Section 254 of the Real Property Law of New York
covering the insurance of buildings against loss by fire, the provisions of this
Mortgage shall control.

                                       19
<PAGE>

     Section  5.17.  Trust  Fund.  Pursuant to Section 13 of the lien law of New
York,  Mortgagor  shall receive the advances  secured  hereby and shall hold the
right to receive  such  advances  as a trust  fund to be  applied  first for the
purpose  of paying the cost of any  improvement  and shall  apply such  advances
first to the payment of the cost of any such  improvement on the Property before
using any part of the total of the same for any other purpose.

     Section 5.18. Section 291-f Agreement. This Mortgage is intended to be, and
shall operate as, the agreement  described in Section 291-f of the Real Property
Law of the  State of New York and shall be  entitled  to the  benefits  afforded
thereby.

     Section 5.19 Section 254 of the Real  Property  Law. All  covenants  hereof
shall be construed as affording  Lender rights  additional to, and not exclusive
of,  the  rights  conferred  under the  provisions  of  Section  254 of the Real
Property law of the State.

                  [Remainder of page intentionally left blank]

                                       20

<PAGE>

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

WITNESSES                                 MORTGAGOR

__________________________________        165-25 147TH AVENUE, LLC

__________________________________        By:_______________________________
                                             Name
                                             Title

__________________________________        49-19 ROCKAWAY BEACH BOULEVARD, LLC

__________________________________        By:_______________________________
                                             Name
                                             Title

__________________________________        85-01 24TH AVENUE, LLC

__________________________________        By:_______________________________
                                             Name
                                             Title

__________________________________        114-15 GUY BREWER BOULEVARD, LLC

__________________________________        By:_______________________________
                                             Name
                                             Title

                                       21

<PAGE>

State of New York :
                  : ss:
County of         :

On the ___ day of June in the year 2007 , before me, the undersigned, personally
appeared

     ,  personally  known to me or  proved  to me on the  basis of  satisfactory
evidence to be the individual(s) whose name(s) is (are) subscribed to the within
instrument  and  acknowledged  to me  that  he/she/they  executed  the  same  in
his/her/their  capacity(ies),  and  that by  his/her/their  signature(s)  on the
instrument,  the  individual(s),   or  the  person  upon  behalf  of  which  the
individual(s) acted, executed the instrument.

                        ________________________________________________________
                        Signature and office of individual taking acknowledgment

State of New York :
                  : ss:
County of         :

On the ___ day of June in the year 2007 , before me, the undersigned, personally
appeared

     ,  personally  known to me or  proved  to me on the  basis of  satisfactory
evidence to be the individual(s) whose name(s) is (are) subscribed to the within
instrument  and  acknowledged  to me  that  he/she/they  executed  the  same  in
his/her/their  capacity(ies),  and  that by  his/her/their  signature(s)  on the
instrument,  the  individual(s),   or  the  person  upon  behalf  of  which  the
individual(s) acted, executed the instrument.

                        ________________________________________________________
                        Signature and office of individual taking acknowledgment

                                       1
<PAGE>

State of New York :
                  : ss:
County of         :

On the ___ day of June in the year 2007 , before me, the undersigned, personally
appeared

     ,  personally  known to me or  proved  to me on the  basis of  satisfactory
evidence to be the individual(s) whose name(s) is (are) subscribed to the within
instrument  and  acknowledged  to me  that  he/she/they  executed  the  same  in
his/her/their  capacity(ies),  and  that by  his/her/their  signature(s)  on the
instrument,  the  individual(s),   or  the  person  upon  behalf  of  which  the
individual(s) acted, executed the instrument.

                        ________________________________________________________
                        Signature and office of individual taking acknowledgment

State of New York :
                  : ss:
County of         :

On the ___ day of June in the year 2007 , before me, the undersigned, personally
appeared

     ,  personally  known to me or  proved  to me on the  basis of  satisfactory
evidence to be the individual(s) whose name(s) is (are) subscribed to the within
instrument  and  acknowledged  to me  that  he/she/they  executed  the  same  in
his/her/their  capacity(ies),  and  that by  his/her/their  signature(s)  on the
instrument,  the  individual(s),   or  the  person  upon  behalf  of  which  the
individual(s) acted, executed the instrument.

            Signature and office of individual taking acknowledgment

                                       1
<PAGE>

                                  SCHEDULE A-1

                               DESCRIPTION OF LAND

<PAGE>

                                  SCHEDULE A-2

                               DESCRIPTION OF LAND

<PAGE>

                                  SCHEDULE A-3

                               DESCRIPTION OF LAND

<PAGE>

                                  SCHEDULE A-4

                               DESCRIPTION OF LAND

<PAGE>

                                  SCHEDULE B-1

                              DESCRIPTION OF LEASE

<PAGE>

                                  SCHEDULE B-2

                              DESCRIPTION OF LEASE

<PAGE>

                                  SCHEDULE B-3

                              DESCRIPTION OF LEASE

<PAGE>

                                  SCHEDULE B-4

                              DESCRIPTION OF LEASE

<PAGE>

                                  SCHEDULE C-1

                             PERMITTED ENCUMBRANCES

<PAGE>

                                  SCHEDULE C-2

                             PERMITTED ENCUMBRANCES

<PAGE>

                                  SCHEDULE C-3

                             PERMITTED ENCUMBRANCES

<PAGE>

                                  SCHEDULE C-4

                             PERMITTED ENCUMBRANCES

<PAGE>
<TABLE>
<CAPTION>

                                   SCHEDULE D

                                   INSURANCE

<C>                          <C>                   <C>                <C>                        <C>                <C>

        COVERAGE               AMOUNTS OR LIMITS         COMPANY         POLICY NUMBER            EFFECTIVE MO.         EXPIRES
                                                                                                  DAY YR                DAY YR.

--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
1. PACKAGE                                             Travelers        Y6601533C949TIL06          12/31/2006        12/31/2007
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------

--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
GENERAL
LIABILITY
SECTION
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Each Occurrence                  $1,000,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
General Aggregate
Per Location                     $2,000,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Products/Comp.
Ops Aggregate                    $1,000,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Premises Damage
Liability                        $100,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Medical Payments                 $10,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------

--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
EMPLOYEE BENEFITS
LIABILITY SECTION
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Aggregate Limit
of Liability                     $1,000,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Each Claim                       $1,000,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Deductible -
Each Claim                       None
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------

--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
CRIME SECTION
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Employee
Dishonesty                       $100,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Computer Fraud                   $100,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Theft D&D Premises               $20,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Theft, D&D
Messenger-Outside                $10,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Deductible - Per
Occurrence                       $5,000
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------

--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
INLAND MARINE
SECTION
--------------------------- ---------------------- ------------------ -------------------------- ------------------ ----------------
Data Processing
Equipment                        $21,000
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Deductible                       $1,000
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------

-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
2. EXCESS LIABILITY
INSURANCE                                            Travelers           YFSEX3718C988TIL06            12/31/2006       12/31/2007
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Per Occurrence                   $25,000,000
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Aggregate                        $25,000,000
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------

-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
3. STORAGE TANK
POLLUTION LIABILITY                                  American            ST1955273                      7/26/2006      7/26/2007
                                                     International
                                                     Specialty Lines
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Form - Claims Made
Coverage
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Sudden & Gradual
Pollution
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Limits of
Liability
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Each Incident                    $1,000,000
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Aggregate                        $4,000,000
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Deductible                       $25,000 ea.
                                  Accident
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Certified Acts
of Terrorism
Coverage
-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------

-------------------------- ---------------------- ------------------ -------------------------- ------------------ -----------------
Location Schedule
(Applies to the
three policies
listed above)
-------------------------- ---------------------- ------------------ -------------------------- ------------------------- ----------
1. 165-25 147th Avenue,
   Jamaica, NY
-------------------------- ---------------------- ------------------ -------------------------- ------------------------- ----------
2. 49-19 Rockaway Beach
   Blvd., Avenue, NY
-------------------------- ---------------------- ------------------ -------------------------- ------------------------- ----------
3. 85-01 24th Avenue,
   East Elmhurst, NY
-------------------------- ---------------------- ------------------ -------------------------- ------------------------- ----------
4. 114-15 Guy Brewer
   Blvd., Queens, NY
-------------------------- ---------------------- ------------------ -------------------------- ------------------------- ----------

</TABLE>

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