Dear Shareholders:

The board is pleased to announce that on September 4th, we closed on a new mortgage with

Valley National Bank. The new $3.2 million, 10-year mortgage takes advantage of historically

low interest rates, and promises to keep our building on a solid financial footing for many years

to come.

The new mortgage provides our building with $1 million in additional funds that will enable

us to pay for our parapet reconstruction project without charging an assessment. The additional

money will also help us strengthen our reserve fund. Once our construction project and new

boiler are paid for, we expect our reserve fund to have between $800,000 and $1 million.

The interest rate on our new interest-only mortgage is 4%, which is about one-third lower than

the 5.68% rate on our previous mortgage. With the lower rate and interest-only structure, we will

save $4521 per month in mortgage payments. That savings will add up. Over the next 10 years,

the $542,509 we will save can be added to reserves, spent on projects that improve our quality of

life, or be used to keep maintenance as low as possible.

Although our new $3.2 million mortgage is nominally larger than our $2.6 million mortgage

from 2002, it is actually smaller when inflation since 2002 is taken into account. More

importantly, because our building has grown in value, we now have a much smaller “loan-to-

value-ratio” than we did in 2002. With the building recently appraised at $25 million, our new

loan to value ratio is an extremely low 13%, which will put us in an extremely good position

when we ultimately refinance again in 2022.

The new mortgage also gives us access to a supplementary $400,000 line of credit. Although

we don’t expect to tap this emergency credit line, having it provides the building with additional

financial security.

In sum, our new mortgage will help us pay for our long-delayed parapet project, it will help

strengthen our reserve fund, and it will help us save money every month for the next 10 years.

All of this promises to preserve our quality of life and enhance our building’s growing value.

The Board of Directors