Appraisal,_May_23,_2025.pdf

LOWERYPA.COM

APPRAISAL REPORT

RECREATIONAL FACILITY

YMCA COLLIN COUNTY ADVENTURE CAMP

1180 West Houston Street

Collin County, Texas 75409

CLIENT

Collin County

May 23, 2025

Collin County

Bill Bilyeu, County Administrator bbilyeu@co.collin.tx.us

1180 West Houston Street

Collin County, Texas 75409

In accordance with your request and authorization, we have completed an Appraisal Report of the captioned property for the purpose of developing an opinion of market value of the subject property. It is our intent to comply with the

Uniform Standards of Professional Appraisal Practice (USPAP).

It should be noted that the undersigned have experience in appraising properties considered similar to the subject, in the subject market area, and therefore comply with the Competency Rule as outlined in USPAP.

The following report, plus the Addenda, sets forth our findings and conclusions. Maps, plats and photographs that are considered essential to explain the reasoning followed in making the appraisal have been included and the conclusions are expressed therein. Also, no hazardous materials or waste were noted upon inspection of the subject property. Please refer to the Basic Assumptions and Limiting Conditions section of this report.

USPAP Standards Rule 1-2(h) states that an appraiser must identify the scope of work necessary to complete an assignment. The scope of work is acceptable when it is consistent with: (1) the expectations of participants in the market for the same or similar appraisal services; and (2) what the appraiser’s peers’ actions would be in performing the same or similar assignment in compliance with USPAP. In the case of the subject property, both of these USPAP criteria have been met.

NOTEWORTHY POINTS

▪ The subject site is 427.009-acres (18,600,623 SF) of land improved with a variety of improvements associated with operation of the YMCA Collin County Adventure Camp totaling 80,530 SF, along with various ancillary site improvements.

▪ The subject displays a management agreement between Collin County and the Young Men’s Christian

Association of Metropolitan Dallas in which the County allows the YMCA to operate an outdoor youth camp at its own expense. Given that the YMCA does not pay rent and that there is no formal lease agreement, only the fee simple value is analyzed herein.

▪ The subject is not currently under contract nor listed for sale.

▪ The Sales Approach was fully developed herein, analyzing the subject both with and without a deed restriction, as further described herein. The omission of the Cost and Income Approaches is not considered to, in any way, reduce the credibility of the value conclusions herein. The Cost Approach would provide a less credible indication of value given the subjectivity in estimating physical depreciation given the aged improvements constructed 18 years ago (2006) and additionally, the difficulty in accurately quantifying any functional obsolescence that is present due to the purpose-built special-use nature of the subject improvements. The

Income Approach was not utilized given that similar facilities are predominantly owner-occupied or are public use facilities and are not leased.

▪ Reader is referred to the Extraordinary Assumption and Hypothetical Condition in the Scope of Work section herein.

The appraisal, subject to the assumptions and limiting conditions as expressed herein and conducted according to the

Uniform Standards of Professional Appraisal Practice, led us to develop the opinion of market value of:

Status Interest Date Value

As Is - No Deed Restriction Fee Simple May 21, 2025 $11,750,000

As Is - Deed Restriction Fee Simple May 21, 2025 $7,260,000

VALUE CONCLUSION

It is emphasized that the above value indication does not include any FF&E, business value, and/or goodwill.

Support and explanation for our value conclusion is explained in detail in the contents of the attached report. It has been a pleasure to assist you, and if we can be of service to you in the future, please let us know.

Lowery Property Advisors, LLC

MARK LOWERY, MAI, AI-GRS, CCIM, MRICS MICHAEL A. MCLAIN, MAI, R/W-AC

Texas State Certified General Real Estate Appraiser Texas State Certified General Real Estate Appraiser

Certificate No. TX1334103-G Certificate No. TX1380290-G mark@lowerypa.com andy@lowerypa.com

DANIELLE WATKINS, MAI

Texas State Certified General Real Estate Appraiser Certificate No. TX1381091-G danielle@lowerypa.com mailto:mark@lowerypa.com

CONTENTS

SALIENT DATA

SUBJECT PHOTOS

INTRODUCTION

SCOPE OF WORK

REGIONAL

NEIGHBORHOOD

DEMOGRAPHICS

ECONOMIC UPDATE

DESCRIPTION

PROPERTY HISTORY

REAL ESTATE TAXES

HIGHEST & BEST USE

VALUATION – NO DEED RESTRICTION

SALES COMPARISON APPROACH

VALUATION – DEED RESTRICTION

SALES COMPARISON APPROACH

MARKETING / EXPOSURE TIME

ASSUMPTIONS & LIMITING CONDITIONS

CERTIFICATION

ADDENDUM

SALIENT DATA COLLIN COUNTY ▪ TEXAS

LPA 2025.03.377 PAGE 1

SALIENT DATA

GENERAL

Date of Valuation May 21, 2025

Date of Inspection May 21, 2025

Property Rights Fee Simple

SITE

Location The subject is located on the north side of West Houston Street, just west of Farm to Market 3133, and just east of County Road 480. The address associated with the subject is 1180 West Houston Street, Collin County, Texas 75409.

Site Description The subject site is comprised of eight (8) contiguous parcels totaling

427.009-acres (18,600,512 SF) and is irregular in shape with rolling topography. There are three (3) lakes located on the subject site:

Harris Lake, Willow Lake, and Lindberg Lake. Only a small portion of

Harris Lake is located on the subject, the majority of Willow Lake is located on the subject, and the entirety of Lindberg Lake is on the subject site. Floodplain is noted. Reader is referred to the Site

Description section for further details.

Legal Description Block 2, Abstract 784, Tract 84, John Rowland Survey

Block 1, Abstract 784, Tract 12, John Rowland Survey

Block 4, Abstract 289, Tracts 23 and 30 G. W. Daniels Survey

Block 3, Abstract 289, Tracts 27,28, 32 and 55, G. W. Daniels Survey

Zoning Not Zoned

SALIENT DATA COLLIN COUNTY ▪ TEXAS

LPA 2025.03.377 PAGE 2

IMPROVEMENTS

General Description The subject site is improved with a variety of improvements associated with operation of the YMCA Collin County Adventure

Camp totaling 80,530 SF, along with various ancillary site improvements. The improvements consist of an administration building, dining hall, education building, health care building, boat storage building, maintenance warehouse, student cabins, teacher cabins, staff residences, restroom buildings, and a pool house. The subject also displays various site improvements consisting of an amphitheater, swimming pool, climbing apparatus, activity pavilions, program shelters, two (2) zip lines, fishing docks, hiking trails, and an archery range. Overall, the subject improvements are of average quality of construction and in average condition. Reader is referred to the Improvements section for further details.

Gross Building Area 80,530 SF

Year of Construction/Renovations 2006 / Various Renovations Since

Quality of Construction Average

Condition of Improvements Average

Land to Building Ratio 230.98:1

HIGHEST & BEST USE

As Vacant – No Deed Restriction Rural residential, agricultural, and/or recreational use

As Improved – No Deed Restriction Rural residential, agricultural, and/or recreational use

As Improved – Deed Restriction Continued use as a recreational facility

SUBJECT PHOTOS COLLIN COUNTY ▪ TEXAS

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SUBJECT PHOTOS

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AERIAL

MAP

INTRODUCTION COLLIN COUNTY ▪ TEXAS

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INTRODUCTION

This is an Appraisal Report, which is intended to comply with the reporting requirements set forth under

Standards Rule 2-2(a) of the Uniform Standards of Professional Appraisal Practice for an Appraisal Report.

Supporting documentation concerning the data, reasoning and analyses is retained in the appraiser's file. The depth of discussion contained in this report is specific to the needs of the client and for the intended use stated below. The appraiser is not responsible for unauthorized use of this report. Furthermore, as agreed upon with the client prior to the preparation of this appraisal, this is an appraisal as set forth by USPAP.

TYPE OF VALUE

The value definition employed in this report is Market Value as defined in 12 CFR - Part 34.42 (FIRREA), Department of the Treasury, Office of the Comptroller of the Currency.

Market value means the most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:

▪ Buyer and seller are typically motivated;

▪ Both parties are well informed or well advised, and acting in what they consider their own best interests;

▪ A reasonable time is allowed for exposure in the open market;

▪ Payment is made in terms of cash in US dollars or in terms of financial arrangements comparable thereto; and

▪ The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.

Intended Use Evaluation of assets.

Intended User Collin County c/o Bill Bilyeu

Client Collin County c/o Bill Bilyeu

Interest Valued Fee Simple

Date of Valuation May 21, 2025

Date of Inspection May 21, 2025

Date of Report May 23, 2025

SCOPE OF WORK COLLIN COUNTY ▪ TEXAS

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SCOPE OF WORK

The scope of the assignment relates to the extent and manner in which research is conducted, data is gathered and analysis is applied. In preparing this appraisal, the appraisers did the following:

▪ Inspected the subject property;

▪ Searched the applicable market area for comparable market data. We utilized multiple sources including but not limited to: Costar, Loopnet, area brokers, local MLS, as well as our proprietary database.

▪ Interviewed landowners and local brokers familiar with the subject area and considered their insight of the current market and transactions;

▪ Obtained information from surrounding counties and area jurisdictions regarding zoning, taxes, property history, flood plain, utilities, etc.

▪ The Sales Approach was fully developed herein, analyzing the subject both with and without a deed restriction, as further described herein. The omission of the Cost and Income Approaches is not considered to, in any way, reduce the credibility of the value conclusions herein. The Cost Approach would have provided a less credible indication of value given the subjectivity in estimating physical depreciation given the aged improvements constructed 18 years ago (2006) and additionally, the difficulty in accurately quantifying any functional obsolescence that is present due to the purpose-built special-use nature of the subject improvements. The Income Approach was not utilized given that similar facilities are predominantly owner-occupied or are public use facilities and are not leased. The inclusion or exclusion of approaches to value was determined by LPA and not our client.

▪ To develop an opinion of value, the appraiser performed an appraisal process, as defined by the

Uniform Standards of Professional Appraisal Practice.

SCOPE OF WORK COLLIN COUNTY ▪ TEXAS

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Extraordinary Assumptions & Hypothetical Conditions

It is emphasized that per USPAP, “the use of extraordinary assumptions and or hypothetical conditions may have affected assignment results.” These terms are defined as follows:

Extraordinary Assumption “an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.”

This report is made with the following extraordinary assumption(s):

▪ It is noted that the appraiser performed an exterior only inspection on the property and that the interior condition is assumed to be similar to that as observed during the last inspection of the property on April

23, 2024.

Hypothetical Condition, “a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.” This report is made with the following hypothetical condition(s):

▪ Given the appraisal problem to be solved being to determine the market value of the property as though a deed restriction were in place, the “as is” market value with the deed restriction is predicated on a hypothetical condition. This value scenario analyzes the subject property as though a deed restriction were currently in place as of the effective date of value, although there is not currently a deed restriction in place. Per information provided by the client, the deed restriction would require that the subject be used as an outdoor education camp for the school aged children in Collin County. The deed restriction would also permit the operator to run the facility for summer camps, corporate retreats, and/or reunions.

REGIONAL COLLIN COUNTY ▪ TEXAS

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REGIONAL

The subject is located within the Dallas/Fort Worth Consolidated Metropolitan Statistical Area (CMSA), otherwise more commonly referred to as the Metroplex. The CMSA is made up of twelve contiguous counties in North Central Texas.

DEMOGRAPHICS

Based on estimates from Moody’s Analytics, the current population of the DFW area is 8,276,500, making it the largest metropolitan area in the South. The Dallas–Fort Worth–Arlington MSA is, by population, the largest metropolitan area in Texas, the largest in the South, the fourth largest in the United States, and the tenth largest in the Americas. The NCTCOG considers 16 counites to be part of the DFW Metroplex. Most of the total growth of the area occurred in the four largest counties, including Dallas, Tarrant, Collin, and Denton. The Metroplex is projected to have fourth largest gross metropolitan product (GMP) in the United States with a projected total of $620.6 Billion and is approximately the tenth largest by GMP in the world.

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ECONOMICS

Dallas – Plano – Irving MSA

Revised data indicate that job growth in Dallas-Plano-Irving has come to a standstill recently, falling behind the national average. This is unusual for an area known for its rapid expansion. The primary area of decline has been in essential professional services, with notable decreases also seen in hospitality and transportation services. Financial services have decelerated, though they are still slightly outperforming the national industry.

The unemployment rate has been stable in the range of 3.8%, essentially equal to the national rate. However, labor force growth has slowed, though it is still a bit above the national pace. The housing market is sending mixed signals, with new permits for single-family units rising while permits for multifamily units are falling. House prices are rising faster than the Texas average but more slowly than the national average.

The slowdown in professional services will continue over the coming quarters, consistent with the national deceleration in economic activity. Elevated costs of borrowing and weak global economic activity are taking their toll. However, ultimately the metro division's fundamental strengths will return the industry to growth. Over the past several decades, numerous large employers have either relocated to or expanded in Dallas. These include Toyota, AT&T, Texas Instruments, defense manufacturers, airlines, major banks and others. Drivers have included a lower cost of doing business than in most other comparably large metro areas and the well-developed transportation network. Consequently, there has been a significant influx of young professionals, and the presence of a highly educated workforce has further attracted more business relocations. In particular, high-tech employment is an above-average share of the total, and the absolute number of such workers exceeds that in Austin.

Financial services will advance, albeit slowly, even in the high-interest-rate environment. Employment managed to grow by nearly 2% over the course of 2023, twice the national average, though it has decelerated more recently. Elevated borrowing costs have limited gains in conventional lending for mortgages and car loans. Longer term, the prospects are more promising. The reason is that local banks also engage in investment banking and portfolio management. Over the years, the metro division has grown into a major financial hub, with industry employment now second only to New York City. As a result, large institutions continue to invest. In October 2023, Goldman broke ground on a new 800,000 sq. ft. building in Dallas that will have the capacity to house up to 5,000 employees. In September, Wells Fargo broke ground on its new campus. Both companies project sizable increases in local payrolls.

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Homebuilding will advance at a moderate pace over the coming year, despite still-high mortgage rates in the range of 7%. One reason is that house prices have continued to rise because of the low supply of homes on the market, though since Dallas's housing is more overvalued than the national average, increases will be less than the national average. More fundamentally, demographics remain strong, with population growth of

2% in 2023, far above the national average.

Strengths

▪ More corporate expansions and relocations than expected boost growth.

▪ Population growth boosts personal services more than expected.

Weaknesses

▪ Interest rates curb affordability, slowing the housing market.

▪ Office development lags longer than expected because of potential for remote work.

2019 2020 2021 2022 2023 INDICATORS 2024 2025 2026 2027 2028

389.4 391.5 431.1 449.9 469.9 Gross metro product (C12$ bil) 488.5 501.2 515.2 531.2 548.3

4.2 0.5 10.1 4.4 4.5 % change 4.0 2.6 2.8 3.1 3.2

2,691.7 2,611.5 2,744.1 2,932.5 3,031.7 Total employment (ths) 3,075.6 3,115.5 3,144.7 3,171.7 3,199.6

2.8 -3.0 5.1 6.9 3.4 % change 1.4 1.3 0.9 0.9 0.9

3.3 7.1 5.0 3.5 3.7 Unemployment rate (%) 3.7 3.7 3.6 3.6 3.6

6.7 5.6 11.2 6.7 6.2 Personal income growth (%) 6.1 5.4 5.4 5.4 5.5

73.8 75.9 80.0 85.6 89.8 Median household income ($ ths) 92.5 95.7 98.9 102.2 105.6

5,081.4 5,151.2 5,222.8 5,323.4 5,425.3 Population (ths) 5,512.2 5,589.5 5,663.3 5,737.8 5,813.0

1.6 1.4 1.4 1.9 1.9 % change 1.6 1.4 1.3 1.3 1.3

46.3 41.2 50.6 72.8 68.5 Net migration (ths) 52.6 44.7 41.7 42.9 44.0

25,311 31,769 38,575 31,097 30,442 Single-family permits (#) 28,864 27,835 29,468 29,384 28,879

18,295 11,029 18,846 25,267 19,014 Multifamily permits (#) 18,893 20,401 20,789 21,038 20,716

4.1 3.8 15.0 22.6 3.9 FHFA house price (1995Q1=100) 1.4 -0.9 -0.1 0.6 1.3

Moody's Analyt ics

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Fort Worth – Arlington MSA

Revised data shows that Fort Worth-Arlington job growth has been slower than that of the U.S. in recent months. Just about every private-sector industry is underperforming its national counterpart, especially core manufacturing. The weak April Texas Manufacturing Outlook Survey corroborates this trend. The unemployment rate has been stable in the range of 3.8% for the past year. On the positive side, labor force growth has been modestly higher than that of the nation. Housing market data have been subdued. House price increases have been much slower than the national average and single-family permits have been flat for a year.

The near-term prospects for a strong revival of heavy industry are low. One reason is that exports, a major source of the demand for manufacturing, have been slow over the past year because global growth has been relatively soft. Further, high interest rates resulting from the Federal Reserve's fight against inflation have kept the value of the dollar elevated, making U.S. goods less competitive. Also contributing to the weakness has been the slow pace of energy exploration, even though Fort Worth produces equipment and supplies for drilling.

Additionally, there have been technical problems in the delivery of Lockheed's F-35 joint strike fighter, the largest segment of the metro division's factory output. Specifically, delays in federal certification of Technology

Refresh 3 (TR-3) upgrades have held up shipments of the aircraft. The original expectation had been that more than 150 planes would be delivered in 2024, but that has been scaled back to about 100. The good news is that demand remains high. In addition to the Department of Defense, the Czech Republic and Greece have bought planes in the past half year. Lockheed still estimates that 2,000 planes will ultimately be delivered, with about 1,000 built to date, supporting manufacturing in the metro division in coming years.

Homebuilding will grow slowly over the coming year, as mortgage rates remain elevated for longer than expected. New permits for single-family homes dropped by more than half during 2022, more than the national decline. Subsequently, after a modest recovery in early 2023, they have been flat. New multifamily permits have had a comparable drop. House price increases have also been much slower than the national or Texas averages, in the 2% range. Longer term, once interest rates finally decline, the Fort Worth housing market should grow at an above-average pace, lifted by strong demographics. Population rose 1.8% in 2023, much more than the national rate. Additionally, Fort Worth has better affordability than neighboring Dallas, supporting the ability to live in Fort Worth and commute.

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High interest rates will also take their toll on financial institutions in the near term. Revised data show that following the early-2023 failures of several banks outside of Fort Worth, local institutions shed jobs during the second half of the year. Longer term, the prospects are better. In recent years, a number of community banks headquartered in slow-growing states like Missouri, Arkansas, Oklahoma and Pennsylvania set up new regional operations in Fort Worth to take advantage of the metro division's trend growth.

Strengths

▪ Homebuilding rebounds more than expected because of low supply of existing homes for sale.

▪ Military aircraft deliveries rebound more strongly as technical issues resolve.

Weaknesses

▪ Banking weakens because of elevated interest rates.

▪ Energy-related manufacturing slow to rebound because of decline in oil prices.

2019 2020 2021 2022 2023 INDICATORS 2024 2025 2026 2027 2028

145.0 139.2 149.9 154.9 163.7 Gross metro product (C12$ bil) 171.0 175.7 180.9 186.8 193.0

1.6 -4.0 7.7 3.4 5.7 % change 4.5 2.7 2.9 3.3 3.4

1,096.4 1,056.2 1,097.7 1,159.3 1,196.9 Total employment (ths) 1,217.1 1,233.4 1,245.5 1,256.7 1,268.3

2.8 -3.7 3.9 5.6 3.2 % change 1.7 1.3 1.0 0.9 0.9

3.3 7.3 5.2 3.6 3.7 Unemployment rate (%) 3.7 3.5 3.5 3.5 3.5

2.9 5.3 12.9 4.4 5.8 Personal income growth (%) 6.0 4.9 5.0 5.1 5.2

68.4 70.5 72.7 75.9 79.0 Median household income ($ ths) 81.2 84.0 86.8 89.7 92.7

2,557.8 2,586.2 2,618.7 2,669.3 2,720.6 Population (ths) 2,764.3 2,803.2 2,840.4 2,877.9 2,915.7

1.2 1.1 1.3 1.9 1.9 % change 1.6 1.4 1.3 1.3 1.3

16.4 17.7 25.0 40.8 38.2 Net migration (ths) 30.2 26.2 24.8 25.4 26.1

9,849 12,646 13,649 12,979 11,901 Single-family permits (#) 11,688 11,969 12,720 12,698 12,466

9,500 5,778 7,927 8,982 5,359 Multifamily permits (#) 6,382 5,620 6,297 6,891 6,915

4.9 4.5 15.3 21.7 3.2 FHFA house price (% Change) -0.3 -1.3 -0.1 0.7 1.4

Moody's Analyt ics

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TRANSPORTATION

Dallas / Fort Worth International Airport

The Dallas/Fort Worth International Airport, located between the cities of Dallas and

Fort Worth, is the largest and busiest airport in the state of Texas. DFW is the second largest airport in the country and sixth largest in the world. It is the fourth busiest airport in the world in terms of aircraft movements and the fifteenth busiest airport in the world in terms of passenger traffic. Every major city in the continental U.S. can be reached within four hours. American Airlines, based in Fort Worth, has its headquarters adjacent to DFW Airport. As of January 2020, DFW Airport has service to a total of 260 destinations, including 67 international and 193 domestic destinations with the U.S. In surpassing 200+ total destinations, DFW joined a select group of airports worldwide with that distinction. As of

January 2020, the airport has more non-stop domestic destinations than any other airport in the U.S. In March

2020, DFW earned the title of Best Large Airport by Airports Council International, for the second year in a row.

Dallas Love Field Airport

Love Field Airport (IATA airport code: DAL) is a city-owned public airport six (6) miles northwest of downtown Dallas, Texas. It was Dallas' main airport until 1974 when Dallas/Fort Worth

International Airport (DFW) opened. All Southwest Airlines’ flights to and from Dallas go through

Love Field, with the airline’s corporate headquarters being located close by the airport. Southwest Airlines is the largest carrier in the world in terms of passengers carried. Seven full service fixed base operators (FBOs) provide general aviation service: fuel, maintenance, hangar rentals, and charters. Some also provide meeting rooms, car rentals, limousine service and restaurants. The Love Field Modernization Program (LFMP), a $519 million modernization project, began in early 2009 to construct a new building that would house 20 gates at

DAL, as well as a remodeled lobby, an expanded baggage claim area and a new ticketing wing. The newly renovated Love Field Airport re-opened in the Fall of 2014. A new seven story parking garage connected to the existing terminal opened in November 2018. Its capacity is 5,300 cars and cost $208 million to construct.

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Texas Department of Transportation

The Dallas-Fort Worth area has thousands of lane-miles of freeways and interstates. The

Metroplex has the second largest number of freeway-miles per capita in the nation, behind only the Kansas City Metropolitan Area. Like most major metropolitan areas in Texas, most interstates and freeways have frontage roads where most of the city’s businesses are located.

these access roads have slip ramps that merge onto the freeways and interstates. North-south Interstates include I-35, which stretches all the way to Minnesota and I-45, which provides easy access to Houston. East-west routes include I-30, which connects DFW to Little Rock, Arkansas, and I-20, which stretches all the way to

South Carolina. I-35 splits into I-35E and I-35W from Denton to Hillsboro: I-35W goes through Fort Worth while I-

35E goes through Dallas. HOV lanes currently exist along I-35E, I-30, I-635, US 67, and US 75. I-20 bypasses both

Dallas and Fort Worth to the south while its loop, I-820, loops around Fort Worth. I-635 splits to the north of I-20 and loops around east and north Dallas, ending at SH 121 north of DFW Airport. I-35E, Loop 12, and Spur 408 ultimately connect to I-20 southwest of Dallas, completing the west bypass loop around Dallas.

Dallas Area Rapid Transit

Dallas Area Rapid Transit, which includes light rail and bus service, features the nation’s longest light-rail network and enables easy access to key job centers in Dallas and its suburbs. DART also provides convenient light-rail access to Dallas Fort Worth International Airport and interfaces with the Texas Railway Express (TRE). The TRE is an intercity commuter train that transports passengers between downtown Dallas and Fort Worth, with stops at several “mid-cities” suburbs in between. Fort Worth residents are served by the T, which also connects to the TRE. The Denton County Transportation Authority (DCTA) operates its A-Train, which connects DART riders in Carrollton to five stations ending in Denton. Additional public transportation options in the area include the TEXRail commuter rail line extending from downtown Fort

Worth into Terminal B at the Dallas Fort Worth International Airport, which opened in January 2019, and an on-demand ridesharing provided by a partnership between Arlington and Via that launched in December 2017.

Via is an on-demand transit system that services the city of Arlington which takes multiple passengers heading in the same direction and books them into a shared vehicle.

CONCLUSION

Dallas-Plano-Irving will advance no faster than the nation over the coming year, as elevated interest rates limit gains in professional and financial services. Longer term, above-average population growth and the concentration of corporate headquarters, technology businesses and financial services will contribute to an above-average performance. Fort Worth-Arlington will grow more slowly than the nation over the coming year, as manufacturing lags. Longer term, above-average population growth, a diversified manufacturing base, and lower business costs and costs of living relative to Dallas will support above-average gains.

ins.

NEIGHBORHOOD COLLIN COUNTY ▪ TEXAS

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NEIGHBORHOOD

A neighborhood is typically a segment of a community, city or town which is a homogeneous grouping of individuals, buildings or business enterprises within the larger community. A neighborhood has three stages of life and possibly a fourth. They are (1) integration (the development stage), (2) equilibrium (the static stage),

(3) disintegration (the declining or decaying stage), and possibly (4) a redevelopment or rejuvenation state or period and continuance of the neighborhood life cycle.

SUBJECT

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ACCESS

The subject is located in the Anna ETJ, Collin County, Texas. Access to the subject neighborhood is considered excellent due to the presence of the Dallas/Fort Worth freeway system. Central Expressway (75) is located west of the subject and provides excellent north-south transportation in the eastern portion of the Dallas/Fort

Worth Metroplex.

There are a two major roadway projects that are currently underway within the city limits of Anna. The expansion of US Highway 75 from Melissa Road to just north of Farm to Market Road 455 includes a redesign of the interchange and bridge over the highway. This $79 million dollar project was executed on March 16, 2016 and was projected to take 884 days (~29 months) to complete. The City has approximately 2.25 miles of water lines that are being relocated as part of the project and the Anna City Council recently approved an

Inter-local Agreement (ILA) with Collin County related to funding for the Utility Relocation Project. Furthermore, the subject’s fronting roadway, Farm to Market Road 455 (White Street), is in the final process of being ehanced. The project includes expansion of the aforementioned roadway from US Highway 75 to State

Highway 5 from a 2-lane roadway to a 4-lane divided roadway with a grass center median. The project cost of $12,399,737 is being funded by Regional Toll Revenue .

GENERAL INFO

Anna is located on State Highway 5, Farm Road 455, and U.S. Highway 75 eleven miles northeast of McKinney in north central Collin County. Although Collin McKinney settled within a few miles of the future townsite in

1846, John L. Greer, who arrived in 1867, is credited with building the first home and store in the new community. The Houston and Texas Central Railway, at that time built between Dallas and Denison, passed through the area in 1873. By the time Anna was platted in 1883, it had a population of twenty, two stores, a steam gristmill, and a Baptist church. A post office also opened in that year. By 1890 the town had a population of 100 to 200. Anna was incorporated in 1913, with John L. Greer as first may.

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ANNA TOWN CENTER & US 75 EXPANSION PROJECT

Located on the northeast corner of Highway 75 and Farm to Market

Road 755 is the 115-acre Walmart anchored Anna Town Center.

Future development from

Starbucks, Chick-fil-A, Firestone, Holiday Inn, and more retail have already been confirmed. The development is presented by

Edge Realty Partners. U.S. Highway

75 will be expanded from Melissa

Road to just north of Farm to

Market 455. The project was signed in March of 2016. The total project cost is reportedly estimated at $79 million.

ANNA TOWN SQUARE

Located on the northeast corner of Farm to Market Road 422 and

South Powell Parkway (Highway 5) is the 600-acre master-planned community called Anna Town Square. The area will be developed with retail, medical, office, multi-family, and single-family developments. Currently Windsor Homes, Megatel, and DR

Horton are development subdivisions within the master-planned community.

CRYSTAL PARK

Located on west side of North U.S. Highway, just north of County

Road 284, Crystal Park is a proposed 390-acre mixed-use community. The area will be developed with multifamily apartments, commercial and retail, 969 residential homes with various community amenities, as well as a professional campus.

Currently Bloomfield Homes & Longtime North Texas will develop the mixed-use community.

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UTILITIES

The subject neighborhood is adequately served by all the typical utilities, including water, sewer, electric service, natural gas, private well and septic and public telephone. No shortages of utility service in the developed portions of the neighborhood were reported and lack of utilities has not been detrimental in the development of the area. Major utility companies servicing the neighborhood include the city of Anna, TXU

Gas Company, and TXU Electric Company.

NUISANCES & HAZARDS

Nuisances and hazards are limited in the subject neighborhood. Vibration, smoke, smog, odors and intense noise are basically related to vehicular traffic along the major thoroughfares. As in any area, traffic density poses problems ranging from congestion to noise. These problems are not severe and are a natural part of most communities.

LIFE CYCLE

Each neighborhood has a unique and dynamic quality all its own, given man's unique imagination, design and development of an area. This quality is described as a "life cycle," which is identified in The Appraisal of

Real Estate as evolving through the following four stages.

Growth Neighborhood gains public favor and acceptance

Stability Equilibrium without marked gains or losses

Decline Diminishing demand

Revitalization Renewal, modernization and increasing demand

The subject neighborhood appears to be in the growth period of its life cycle. The immediate area is rural in nature within Collin County and is considered to be approximately 30% developed. Properties appear to range in age from new to over 50 years.

CONCLUSION

The subject neighborhood is located in Anna ETJ, Collin County, Texas. Demand for virtually all types of real estate in this area has been mostly stable in recent years. The future growth of the neighborhood relies heavily upon the overall strength of the real estate market within the entire Dallas/Fort Worth area. The subject property displays good locational attributes in the defined neighborhood and should benefit from any positive economic conditions experienced by the immediate area.

DEMOGRAPHICS COLLIN COUNTY ▪ TEXAS

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DEMOGRAPHICS

The following pages summarize data generated by the STDB.

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ECONOMIC UPDATE COLLIN COUNTY ▪ TEXAS

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ECONOMIC UPDATE

LPA is committed to monitoring the current economic environment. The following section analyzes several current economic factors such as the lingering effects of COVID-19, inflation, gas prices, supply chain issues, unemployment, etc. and the effects on commercial real estate.

COVID-19

As COVID-19 began in 2020, unemployment reached a high of 14.7%. GDP declined 34% in Q2 2020, The

CARES Act, enacted shortly after the beginning of COVID, was a shot in the arm of the U.S. economy.

Throughout 2020 and as we entered 2021, the economy began to ease slightly. In 2021 the U.S. began offering four vaccines: Johnson & Johnson, Pfizer, Moderna, and Novavax. The U.S. government enacted various monetary and fiscal policies to assist the economy, such as $377 billion in emergency grants and loans for small businesses and decreasing the federal fund rate. Outlined below is a timeline of important events in the history of the pandemic.

Jan 2020 The first instance of the coronavirus is seen in the U.S.

Mar 2020 The World Health Organization declares COVID-19 a worldwide pandemic.

Mar 2020 President Trump signs a $2 Trillion economic stimulus bill.

Feb 2021 Pfizer, Moderna, and Johnson & Johnson vaccine all approved for emergency use.

Mar 2021 Congress passes the American Rescue Plan, the largest stimulus bill to date.

Mar 2022 The Federal Reserve raised interest rates for the first time since 2018 in order to combat rapid inflation.

May 2023 COVID-19 Public Health Emergency officially ended May 11th in the U.S.

Mar 2024 FDA working towards annual COVID 19 shot, similar to annual Flu shot.

Feb 2025 COVID-19 winter rates decrease as we slowly move toward spring.

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UNEMPLOYMENT

The COVID-19 pandemic accelerated already emerging trends in slow labor force growth and higher demand for skilled labor. The number of jobless claims skyrocketed in March 2020, when the pandemic officially began, with official unemployment numbers reaching 23.1 million or 14.7%. Unemployment had steadily declined over the following months, with the unemployment rate reaching as low as 3.5% in 2023 -returning to pre-pandemic levels. In 2022, US employers added a total of 4.5 million new jobs, which is the second strongest year in the past 40 years after 2021. The majority of the new jobs were led by the leisure and hospitality industry as well as professional and business services. Despite the low unemployment rate and job creations, industries are still having problems being understaffed as people used COVID-19 to change jobs and careers, leaving holes in the industries they’ve left behind. Career changes and the need to work remotely have led to a worker shortage, especially in the food service and hospitality industries. The chart below shows the monthly unemployment rate since May 2022.

UNEMPLOYMENT RATE

Federal Reserve Bank of St . Louis

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-2

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M a y-

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INFLATION

Inflation has hit the United States hard since the beginning of 2021. Inflation is the rate of increase in prices over a given period of time. The most common form of measurement is the Consumer Price Index (CPI). This measures the percentage change in price over a “basket” of goods and services in households. According to the U.S Bureau of Labor Statistics, the annual inflation rate in the U.S. has slowed more than expected to

3.2% in July 2023 from an over 40-year high of 9.1% in June 2022. The below chart using data from the U.S.

Bureau of Statistics shows the inflation rate over the last 40 years and the increase of inflation in the U.S. since

April 2020, and the start of the COVID-19 pandemic.

INFLATION SINCE 1982

U.S. Bureau of Statistics

-4.00%

-2.00%

0.00%

2.00%

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6.00%

8.00%

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14.00%

M a y -8

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M a y -9

M a y -9

M a y -9

M a y -9

M a y -0

M a y -0

M a y -0

M a y -0

M a y -0

M a y -1

M a y -1

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M a y -2

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GAS PRICES

Since early 2022, the national average gas price has generally remained above pre-pandemic levels, though there have been periods of decline. In mid-2022, prices dropped by 32 cents in July and 79 cents in August, followed by a 98-day streak of falling gas prices—the second longest on record behind the 115-day streak in

2014–2015. More recently, prices have fluctuated due to global supply chain shifts, geopolitical tensions, and changes in oil production. Currently, the national average remains volatile but has shown signs of stabilizing.

The chart below illustrates the national average gas price per gallon over the past seven years.

GAS PRICES SINCE 2019

U.S. Energy Information Administration

3.17

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2019 2020 2021 2022 2023 2024 2025

The sharp increase can be contributed to the Russia/Ukraine war as Russia is the 2nd largest exporter of oil in the world. Since beginning in February 2022, the Russia/Ukraine conflict has caused Russia to become heavily sanctioned, playing an important factor in the increase of gas prices. Although the U.S. is the world’s leading gasoline producer, production has decreased since late 2019. Additionally, refineries closing at the beginning of COVID-19 have led to a decrease in operating oil refineries leading to higher demand than supply.

Refineries increase their rates when demand is higher than supply due to the need of the product and the increased willingness of people to pay for that product.

Some reasons for the sharp decrease in gas prices involve panic over inflation driving down prices, people driving less due to the high gas prices, and the Biden administration’s release of emergency oil from the national stockpile.

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INTEREST RATES

Prime Rate is individually determined by banks and often used as a reference rate (also known as the base rate) for several types of loans. Examples of the types of loans using this rate include credit card loans and small business loans. The prime rate is used by banks to lend to consumers and are fixed and typically do not change over extended periods of time.

Secured Overnight Financing Rate is a benchmark interest rate that institutions utilize for business and consumer loans. The Secured Overnight Financing Rate (SOFR) is the dominant benchmark rate after the US

LIBOR panels ended on June 30, 2023. Unlike its predecessor, SOFR incorporates actual lending transaction data amongst institutions making it a more reliable source.

Federal Funds Rate is set by the Federal Open Market Committee (FOMC). This rate is the target at which excess reserves are lent and borrowed amongst commercial banks overnight. This rate influences short-term rates on credit cards and consumer loans as well as piquing investors’ interest by impacting the stock market.

FedPrimeRate

INTEREST RATES

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SOFR Fed Fund PRIME

To combat higher than average inflation, rates began increasing in early 2022. However, in September 2024, federal interest rates were cut by 50 basis points for the first time in four years. A second cut of 25 basis points followed in November 2024, and a third cut of 25 basis points was implemented in December 2024, reflecting a strategic shift in monetary policy aimed at easing financial pressures. Interest rates and capitalization rates typically move in tandem. The increased cost of capital often exerts upward pressure on capitalization rates, which can, but does not always, lead to market softening. LPA remains committed to monitoring and analyzing the ongoing impact of these rate adjustments on commercial real estate markets.

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BANKING

Silicon Valley Bank became the 2nd largest bank collapse in U.S. history at the time (until First Republic

Bank’s collapse a month later) on March 10th, 2023. After the largest bank run in U.S. history, SVB was seized by the Federal Deposit Insurance Corporation (FDIC), and then sold to First Citizens Bancshares.

Signature Bank became the 3rd largest bank collapse in U.S. history at the time, following SVB’s collapse days prior. Unable to bounce back from the combination of the crypto exchange FTX’s collapse and SVB’s collapse, Signature experiences a bank run and ultimately collapses.

First Republic Bank is currently the 2nd largest bank failure in U.S. history, despite the banking industry’s best efforts to save it. The almost $100 Billion dollars pumped into First Republic wasn’t enough to prevent them from selling assets, ultimately being seized and sold.

Mar 8 2023 Silicon Valley Bank creates panic after announcing it sold $21 billion in securities at a loss.

Mar 9 2023 Silicon Valley Bank clients withdraw $42 billion, creating the largest bank run in U.S. history.

Mar 10 2023 As Silicon Valley Bank officially collapses, Signature Bank experiences a multi-billion dollar bank run.

Mar 11 2023 The 11 largest U.S. banks give First Republic Bank $30 billion while JPMorgan Chase gives $70 billion.

Mar 12 2023 Signature Bank is seized by the FDIC and assets sent to Signature Bridge Bank during the bidding process.

Mar 19 2023 Signature Bridge Bank is bought by New York Community Bank and put under the Flagstar Bank subsidiary.

Apr 28 2023 FDIC seizes control of First Republic Bank after it begins selling assets at a loss, causing stock to drop.

May 1 2023 First Republic Bank is officially closed and sold to JPMorgan Chase .

Aug 2 2023 Heartland Tri-State Bank officially becomes Dream State Bank after closing Friday, July 28th.

Jan 31 2024 New York Community Bancorp (NYCB) is now experiencing trouble as stocks fell 46% and lost $252 million.

May 1 2024 Fulton Bank assumes control of Republic First Bank after failed talks with investors over funding.

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EMERGING TECHNOLOGY

Technological advancements in proptech are transforming commercial real estate operations and influencing property valuations. Smart buildings, equipped with Internet of Things (IoT) and automation, enhance energy efficiency, security, and occupant comfort, increasing their market value. These attributes are highly valued, leading to higher valuations. Proptech solutions create operational efficiencies, reducing costs and errors, and streamlining property management. These efficiencies improve financial performance, making properties more attractive to investors. By automating tasks, these technologies reduce costs and errors, leading to better financial performance and, consequently, higher property valuations.

The U.S. smart building market is poised for substantial growth, driven by technological advancements and strategic investments. Key details include:

• 2023 Market Size: Reached USD 21.69 billion.

• 2033 Projection: Expected to grow to USD 64.21 billion.

• Growth Rate: Anticipated CAGR of 11.39% from 2024 to 2033.

• Regional Share: North America captured a 34.11% revenue share in 2023.

U.S. SMART BUILDING MARKET SIZE

Precedence Research

$25

$10

$20

$30

$40

$50

$60

$70

2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033

M a rk e t S iz e

(B il li o n s)

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RELOCATION TRENDS

Relocation trends between states in the US significantly impact the commercial real estate sector. Population influxes in states like Texas and Florida boost demand for office spaces, retail outlets, and residential developments, leading to higher property values and rental rates. Consequently, developers and investors capitalize on these opportunities by initiating new construction projects or refurbishing existing properties to meet rising demand. States with population outflows, like New York and California, face challenges in the commercial real estate market as dynamics in office, retail, and industrial real estate rapidly evolve.

Office Sector As companies relocate or downsize, vacancies rise, reducing rental rates and property values.

Landlords must innovate leasing strategies or reposition assets to attract and retain tenants.

Retail Sector Retail real estate growth is slow due to declining population and consumer spending. Property owners need creative approaches to maintain occupancy and attract tenants.

Industrial Sector Demand for logistics facilities is growing as e-commerce and population increase. Areas with significant population growth are seeing more investment in industrial real estate to support logistics infrastructure.

CONCLUSION

The current economic environment is ever changing. LPA is working diligently to capture and analyze current market data to reliably quantify impacts on real property values, national and regional. As the situation evolves, LPA is committed to monitoring current events and how they impact the commercial real estate market.

U.S. RELOCATION TRENDS 2024

U-Haul Growth Index

DESCRIPTION COLLIN COUNTY ▪ TEXAS

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DESCRIPTION

PHYSICAL

Location

The subject is located on the north side of West Houston Street, just west of Farm to Market 3133, and just east of County Road 480. The address associated with the subject is 1180 West Houston Street, Collin County, Texas

75409.

Legal Description

Block 2, Abstract 784, Tract 84, John Rowland Survey

Block 1, Abstract 784, Tract 12, John Rowland Survey

Block 4, Abstract 289, Tracts 23 and 30 G. W. Daniels Survey

Block 3, Abstract 289, Tracts 27,28, 32 and 55, G. W. Daniels Survey

Size / Configuration / Flood Zone

The subject site is comprised of eight (8) contiguous parcels totaling 427.009-acres (18,600,512 SF) and is irregular in shape with rolling topography. There are three (3) lakes located on the subject site: Harris Lake, Willow Lake, and Lindberg Lake. Only a small portion of Harris Lake is located on the subject, the majority of

Willow Lake is located on the subject, and the entirety of Lindberg Lake is on the subject site. Approximately

15% or 64-acres of the eastern portion of the subject site is located within the 100-year floodplain; however, this is common for the nearby area, and it appears the floodplain has minimal impact on development.

Frontage / Accessibility

Adequate frontage to support the subject improvements. It is noted that the subject displays frontage and access along West Houston Street and Farm to Market 3133. The subject site is considered to possess ample access to the subject’s traffic carriers which are secondary traffic carriers in good overall condition.

Utilities

The subject site has well water and…