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EFTA01384958

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of $98,104 relating to our acquisitions made in the fourth quarter of 2014 (the second and larger tranche of Kimberly Vineyard and Falcon Farms), and $34,665 relating to our existing Golden Eagle Ranch property. Management and performance fees-related party increased by $865,409 due to higher total assets for purposes of the management fees and increased performance fees due to the higher funds from operations and capital appreciation generated in 2015. Such costs arc not expected to continue following the Internalization. Property operating expenses increased by $106,475 during the six months ended Junc 30, 2015. Of the $106,475 increase in property operating expenses, $150,928 related to our acquisitions made in the fourth quarter of 2014 ($45,735 in management fees, $92.166 in real estate taxes, $9,644 in repairs and maintenance, and $3,382 in insurance) and $34,382 related to increased management fees commensurate with the increased revenues from our same-property portfolio. This was partially offset by property operating oasts incurred in 2014 relating to the Hawk Creek Ranch and Pintail Vineyards properties from which we were entitled to participating revenues related to leases assumed at the time the properties were purchased. As a result, our development properties incurred management fees and real estate taxes associated with this revenue in 2014. which ceased once the leases expired. These expenses are currently being capitalized, as these two properties arc under development. Total Other Expense Total other expense increased $171,463, or 416.89%, from $41,129 for the six months ended June 30, 2014 to $212,592 for the six months ended June 30, 2015. The increase in total other expense arises from interest paid on the original credit facility, which was drawn down in the fourth quarter of 2014, and the increased deferred financing costs incurred in establishing the additional credit facility in the first quarter of 2015. Permanent Crop

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