C O M M E R C I A L R E A L E S TAT E S E R V I C E S

Michele Freeman 200 Park Avenue

First Vice President 18 t h Floor
New York, NY 10166
CB Richard Ellis, Inc.
Corporate Services 212 984 7141 Tel
212 984 6640 Fax

michele.freeman@cbre.com
www.cbre.com

February 26, 2009

Paul Slayton
P A Associates
250 West 57th Street Ste 1120
New York, NY 10107

Re: City of New York – 4650 Broadway

HPD

Dear Paul:

I hereby submit, on behalf of the City of New York, the following proposal to lease space in the above
referenced property upon the following terms and conditions:

LANDLORD: Acadia-P/A Sherman Avenue, LLC

TENANT: HPD or for such other use as the Commissioner of the Department
of Citywide Administrative Services (“DCAS”) may determine in
accordance with the use provision (to be negotiated).

PREMISES: 4650 Broadway

Borough of Manhattan

SPACE: Approximately 39,388 rentable square feet of office, and lobby space
on the cellar, ground, and fourth floor, which has been verified by the
Division of Real Estate Services.

Approximately 3,717 rentable square feet of exclusive ramp access

and garage area parking on the cellar floor.
TERM:
Twenty (20) years from Substantial Completion as defined below

RENT COMMENCEMENT: Three (3) months following Substantial Completion of alterations and
improvements.

BASE RENT: Years 1-5: $37.25 prsf per annum

Years 6-10: $42.00 prsf per annum
Years 11-15: $47.34 prsf per annum
Years 16-20: $53.35 prsf per annum

This letter/proposal is intended solely as a preliminary expression of general intentions and is to be used for discussion purposes only. The parties
intend that neither shall have any contractual obligations to the other with respect to the matters referred herein unless and until a definitive
agreement has been fully executed and delivered by the parties. The parties agree that this letter/proposal is not intended to create any
agreement or obligation by either party to negotiate a definitive lease/purchase and sale agreement and imposes no duty whatsoever on either
party to continue negotiations, including without limitation any obligation to negotiate in good faith or in any way other than at arm's length.
Prior to delivery of a definitive executed agreement, and without any liability to the other party, either party may (1) propose different terms from
those summarized herein, (2) enter into negotiations with other parties and/or (3) unilaterally terminate all negotiations with the other party
hereto.
PARKING RENT: Tenant shall also pay $15.00 per square foot with 10% increases
every five years, for its designated parking area within the building.
The standard City lease provides that rent shall be payable at the
end of the month.

OPTION TO RENEW: Tenant shall have the option to renew the lease for a period of
five (5) years at 90% of the Fair Market Value Rental or the then
current rent, on six (6) months prior written notice.

TERMINATION: Tenant shall have the right to terminate the lease on a floor by floor
basis, at any time after the fifteenth (15th) year on one year’s prior
written notice. In the event of said termination, the Tenant shall pay
the Landlord the unamortized portion of the Tenant broker’s
commission and the unamortized portion of Landlord’s contribution
towards Tenant’s work (TW).

REAL ESTATE TAXES:
Landlord to be responsible for payment of all real estate taxes,
assessments, water rates and sewer rents for the space. Tenant
shall reimburse the Landlord for its proportionate share (TBD) of any
increase in real estate taxes, assessments, water rates, and sewer
rents above the base year. The base year shall be (i) the fiscal year
following the date of Substantial Completion if it occurs between
January 1st and June 30thor the first full calendar year following
Substantial Completion if it occurs between July 1st and December
31st.

OPERATING EXPENSES:
Tenant shall reimburse the Landlord for its proportionate share (TBD)
of increases in direct operating expenses above the base year. The
base year shall be (i) the calendar year in which Substantial
Completion occurs between January 1st and April 30th, (ii) the last half
of the calendar year in which Substantial Completion occurs and the
first half of the following calendar year, if Substantial Completion
occurs between May 1st and August 30th, or (iii) the following
calendar year, if Substantial Completion occurs between September
1st and December 31st.

CONSTRUCTION TIMEFRAME: Landlord intends to demolish an existing structure and build a new
building in accordance with the attached project construction
timeline, Exhibit A.

ALTERATIONS &
IMPROVEMENTS: Landlord shall, prior to the commencement of the lease term,
prepare final architectural plans and engineering plans (the “Final
Plans”) and make alterations and improvements in accordance with
preliminary architectural plans and specifications approved by DCAS
and by the Agency. The Work consists of (i) alterations and
improvements, including architectural and engineering plans
therefore, that the Landlord shall perform at its sole cost and
expense described in the Landlord’s Base Building Scope of Work
(“BBW”) and (ii) alterations and improvements that the Landlord
shall perform initially at its own cost and expense described in the
Tenant’s Scope of Work (“TW”). See attached BBW dated January
30, 2009.

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 The total TW cost (defined below) shall not exceed ____. Landlord
shall contribute $20/sf towards the TW cost and the Tenant shall
reimburse Landlord for the balance up to_______ to be disbursed in
one lump sum payment upon the completion of alterations and
improvements. The total TW shall not exceed _________.
Landlord shall not be responsible to pay any overage in excess of
the not to exceed estimate. Landlord shall incur all costs for the
preparation of the TW final architectural plans and final engineering
plans (the “Final Plans”) at its sole cost and expense.

DESIGN/BIDDING/
CONSTRUCTION
PROCEDURES: Plans, bidding and C&S and TW construction shall be done in
accordance with the attached timeline. Both parties agree to adhere
to the attached timeline, which shall become a part of the lease.
Failure on the part of either party to meet the schedule therein
except force majeure shall cause liquidated .damages to incur,
pursuant to the provision below.

DESIGN/BIDDING/
CONSTRUCTION
DEFINITIONS: The TW cost shall consist of all costs and expenses (excluding
construction loan interest and related financing costs) charged to the
Landlord for (a) the DCAS approved Architect's fees for change
orders for the services required for the TW; (b) the filing fees for the
submission of same (change orders only) to the appropriate
governmental authorities for approval; (c) the performance of all
items of the TW; and (d) one general contractor’s general conditions
fee and one contractor's over-head and profit to the extent indicated
in contractor's bid only; the Landlord shall not be entitled to be paid
an administrative or management fee for the performance of the TW.

The Premises shall be deemed "Substantially Complete" upon (1)

reasonable review and certification by DCAS of the Landlord's
completion of the Work excepting minor details of construction or
decoration which do not adversely affect the Tenant's use of the
Demised Premises; and (2) receipt by the Landlord and delivery to
DCAS of (i) all applicable Building Department and Fire Department
inspection sign-offs (including but not limited to Building Department
Post Permit TR-1, Equipment Use Permits, a new Temporary
Certificate of Occupancy, electrical and plumbing sign-offs, Fire
Department and elevator inspections and sign-offs and removal of all
Asbestos), (ii) certified air balancing report approved by the
Landlord's engineer as being in conformance with the Final Plans,
and (iii) Certification from the Landlord’s engineer that a direct
electric meter to the Premises has been correctly installed.

DESIGN/BIDDING/
CONSTRUCTION
LIQUIDATED DAMAGES: In the event the Landlord fails to meet its applicable time frames
above then the Tenant shall give the Landlord a written Delay Notice
advising the Landlord of its failure to so commence, complete and/or
perform. If the Landlord fails to commence, complete and/or perform
the Work or Final Plans within ten (10) business days from the date
of said notice, the Tenant shall give the Landlord a second written
notice. If the Landlord fails to commence, complete and/or perform

3
 the Work or Final Plans within ten (10) business days from the date
of the second notice, the Tenant, in addition to any other remedy it
may have, at it's option may: (i) as agent of the Landlord perform any
of the work and/or plans and deduct the cost thereof from the rent for
Work costs, or (ii) terminate this lease on ten (10) business days
written notice to the Landlord. Tenant cannot terminate if the
landlord is diligently curing its default. Tenant, however, shall not be
required to exercise either of the foregoing rights. If the Tenant
elects not to terminate the lease, and regardless of whether or not
the Tenant provides written Delay Notice to the Landlord, or elects to
perform the Work and/or Final Plans as the Landlord's agent, it shall
receive a rent credit equivalent to one (1) day of free rent for each
day the commencement or Substantial Completion of Work was
delayed or time frames were not met.

LANDLORD SERVICES: Landlord shall provide, pursuant to the Operating Expense Clause in
the lease, heat, air conditioning, hot and cold water and elevator
services, and access twenty-four (24) hours per day, seven (7) days
per week. Landlord shall paint the entire premises, at its sole cost
and expense, once in the tenth (10th) year of the lease term.

REPAIRS: At its sole cost and expense, the Landlord shall be responsible for all
interior latent defects pertaining to Landlord’s Work, exterior and
structural repairs, including, but not limited to, repairs and
replacement of the roof, sidewalks, windows, elevators, electrical,
plumbing, heating, ventilation, and air conditioning systems;
excluding repairs caused by Tenant’s negligence. Landlord shall
provide maintenance/ service contracts for the HVAC equipment.
Tenant shall reimburse Landlord for the cost of the contracts through
the operating cost escalation payments.

FAILURE TO PROVIDE
SERVICES/REPAIRS: Tenant shall have the right of self-help, i.e. if the Landlord should fail
to provide agreed upon services or repairs, as specified in the lease,
the Tenant (i) may, as agent for the Landlord, do any of said services
or repairs and deduct the cost thereof from base any rent due or that
may become due and payable under the lease; not to exceed 30% of
each month’s base rent due by Tenant. or (ii) may withhold all rent
due and owing to the Landlord until the Landlord performs such
services or repairs or (iii) may terminate the lease after due notice to
the Landlord and after applicable cure periods. Details shall be
negotiated in the lease .

CLEANING: Landlord shall provide cleaning and rubbish removal services at its
sole cost and expense in accordance with the cleaning schedule
attached hereto. The base year cleaning cost will be based upon the
cleaning specifications attached to the lease.
PROCURING
COMMISSION: Landlord recognizes that the Tenant has been represented by CB
Richard Ellis, Inc. in these lease negotiations as its Consultant
Tenant Representative and that the Landlord shall pay a full
brokerage commission pursuant to a separate agreement between
the Landlord and CB Richard Ellis, Inc.

ASSIGNMENT/SUBLEASE: The Tenant shall have the right to assign the Premises to any other
City agency of similar type of use, without the approval of the

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 Landlord. Tenant shall have the right to sublease all or a portion of
the Premises to third parties with the Landlord’s prior written consent
which consent will not be unreasonably delayed, conditioned or
withheld.

SECURITY DEPOSIT: None

COMPLIANCE WITH
LAWS/ADA: Tenant shall require that the premises comply with all present and
future federal, state and municipal laws, ordinances, regulations, and
requirements, including, but not limited to, ADA and OSHA. Should
any modifications to the premises be required to achieve such
compliance, the Landlord shall perform the required work at its sole
cost and expense.

ELECTRICITY: Tenant shall pay for its electricity direct to the public utility. Landlord
shall, at its sole cost and expense, provide the meter and any
necessary wiring, as per the attached BBW.

AFTER HOURS
SERVICES: Tenant can request additional after hours services that Landlord
will provide at Tenant’s cost.

HVAC: Tenant shall pay for cost of fuel and/or electricity to power the
independent, tenant controlled HVAC units.

NON-DISTURBANCE: Landlord shall provide the Tenant with a fully executed Non-
Disturbance Agreement for any land and building mortgages and
guarantee non-disturbance agreements from future mortgages to
which the Tenant is required to subordinate its interest.

LANDLORD DISCLOSURE: DCAS is reviewing your recent landlord disclosure submission.

ASBESTOS: Landlord shall remove all asbestos containing materials prior to the
commencement of the lease. Landlord shall provide an asbestos
survey conducted by a licensed asbestos inspector prior to the
execution of the lease. If the survey concludes that there is asbestos
containing material within the premises that, if maintained in its
present condition, does not pose a threat to the health and safety of
the occupants of the site, then the Landlord shall regularly perform
hazard assessments during the term of the lease and shall abate any
deteriorated asbestos which develops in the future. During the term
of the lease, if asbestos abatement is necessary, then the rent shall
be abated for that portion of the space that becomes un-tenantable
during the abatement.

This letter/proposal is intended solely as a preliminary expression of general intentions and is to be

used for discussion purposes only. The parties intend that neither shall have any contractual obligations
to the other with respect to the matters referred herein unless and until a definitive agreement has been
fully executed and delivered by the parties. The parties agree that this letter/proposal is not intended to
create any agreement or obligation by either party to negotiate a definitive lease and imposes no duty
whatsoever on either party to continue negotiations, including without limitation any obligation to
negotiate in good faith or in any way other than at arm's length. Prior to delivery of a definitive executed
agreement, and without any liability to the other party, either party may (1) propose different terms from

5
those summarized herein, (2) enter into negotiations with other parties and/or (3) unilaterally terminate
all negotiations with the other party hereto.

Please call me at 212-984-7141 if you have any questions or if you require clarification of any of these
proposed terms.

Very truly yours,

Michele Freeman

cc: Michael Garaufis, DCAS

Anne Zieha, DCAS
Glenn Pymento, DCAS
Alex Santana, DCAS
John Morrill, CBRE
Keith Thompson, CBRE

AGREED and ACCEPTED BY:

______________________

AGREED and ACCEPTED BY:

Michael Garaufis
DCAS