1. The Mitchell-Lama Program and Village East Towers: How the Mitchell-Lama Program Benefits Our Shareholders Prepared for the VET Annual Meeting January 26,2008

2. The Mitchell-Lama Deal Low operating costs. Monthly charges well below market. Apartment re-sales to middle income people. Basic economics are easily predictable.

3. Monthly Charge Comparisons New York City Housing Authority Stuyvesant Town 1-bedroom$442 to $505 $3055 and up 2-bedroom$520 to $594 $3875 and up 3-bedroom$650 to $743 $5215 and up

4. Monthly Charge Comparisons New York City Housing Authority Village East Towers Stuyvesant Town 1-bedroom$442 to $505 $517 to $555 $3055 and up 2-bedroom$520 to $594 $615 to $661 $3875 and up 3-bedroom$650 to $743 $785 to $832 $5215 and up

5. The Mitchell-Lama Economic Advantage With low monthly maintenance, a resident of 2- bedroom apartment “saves” over $3000 a month in comparison to market rents (at Stuyvesant Town, for example). In a Mitchell-Lama co-op, you benefit every month, as long as you stay. What makes this possible?

6. Village East Towers Has Favorably- Fiananced Debt Senior mortgage payable to HDC –Amount: $4,219,371 –Term: 30 years –Interest Rate: 6.5% Amalgamated Bank loan –Amount: $3,500,000 –Term: 10 years –Interest Rate: 7.0%

7. We Also Have Low Cost and Forgivable Debt Junior mortgage payable to HDC –Amount: $7,882,245 –Term: 30 years –Interest Rate: 0% 8A Loan and Grant –Amount: $4,036,246 –Term: 30 years –Interest Rate: 0.8% HDC Grants –Amount: $922,238

8. What Is Our Total Debt? All of our financing (including grants and forgivable loans) totals: $20,559,981 Of that total $3,343,886 came as grants.

9. What Is Our Total Debt? All of our financing (including grants and forgivable loans) totals: $20,559,981 Of that total $3,343,886 came as grants. This comes to $47,373 per apartment.

10. Village Park East Debt Service The blended interest rate from these loans is: 2.7% Annual Debt Service for the Building: $875,724 Annual Debt Service Per Apartment: $2,018 Monthly Debt Service Per Apartment: $168

11. Current Interest Rates For “Jumbo” Mortgages Are: 7.0% Annual Debt Service for the Building would be: $1,641,433 Annual Debt Service Per Apartment: $3,782 Monthly Debt Service Per Apartment: $315 What Would Our Debt Service Be On the Private Market?

12. 7.0% $1,641,433 $3,782 $315 Debt Service Comparison Interest rate: Annual Debt Service: Per Apt. Debt Service: Monthly Per Apt: 2.7% $875,724 $2,018 $168 Private MarketIn Mitchell-Lama

13. Village East Towers Has Low Taxes Annual Real Estate Taxes for the Building: $260,000 Annual Taxes Per Apartment: $602 Monthly Taxes Per Apartment: $50

14. What Would Our Taxes Be As A Private Co-op? Projected Annual Real Estate Taxes Using Comparables: $2,552,033 Annual Taxes Per Apartment: $5,880 Monthly Taxes Per Apartment: $490

15. $2,552,033 $5,880 $490 Tax Comparison Real Estate Taxes: Per Apt. Tax Debt: Monthly Per Apt: $260,000 $602 $50 Private MarketIn Mitchell-Lama

16. $490 $315 $805 So How Much Do Shareholders Save In Mitchell-Lama? Monthly Per Apt Taxes: Monthly Per Apt Debt: Total: $50 $168 $218 Private MarketIn Mitchell-Lama

17. $490 $315 $805 So How Much Do Shareholders Save In Mitchell-Lama? Monthly Per Apt Taxes: Monthly Per Apt Debt: Total: $50 $168 $218 Private MarketIn Mitchell-Lama $587 Per Month

18. How Does Mitchell-Lama Compare With Rent Stabilization? In 1975 the average maintenance charge for a two bedroom apartment in Village East Towers was $238.35 Today, the average maintenance charge for the same apartment is $626. That’s an average yearly increase of about 2.9%. If the same apartment had been receiving RGB increases during that time, the rent would now be $954. That’s an average yearly increase of about 4.17%.

19. The Mitchell-Lama Deal You save money, every single month: With low purchase prices, most of us have no mortgage payments. It’s a fair deal because we cover our costs and share them equally. But it’s only possible because this is true not-for- profit, co- operative housing.

20. THANK YOU Questions?