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200 Park Avenue18

FloorNew York, NY 10166 212 984 7141 Tel212 984 6640 Faxmichele.freeman@cbre.comwww.cbre.com

COMMERCIAL REAL ESTATE SERVICES This letter/proposal is intended solely as a preliminary expression of general intentions and is to be used for discussion purposes only. The partiesintend that neither shall have any contractual obligations to the other with respect to the matters referred herein unless and until a definitiveagreement has been fully executed and delivered by the parties. The parties agree that this letter/proposal is not intended to create anyagreement or obligation by either party to negotiate a definitive lease/purchase and sale agreement and imposes no duty whatsoever on eitherparty 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 fromthose summarized herein, (2) enter into negotiations with other parties and/or (3) unilaterally terminate all negotiations with the other party

Michele Freeman

First Vice PresidentCB Richard Ellis, Inc.Corporate Services

February 26, 2009Paul SlaytonP A Associates250 West 57

Street Ste 1120New York, NY 10107

Re:City of New York – 4650 BroadwayHPD

Dear Paul:I hereby submit, on behalf of the City of New York, the following proposal to lease space in the abovereferenced property upon the following terms and conditions:LANDLORD:Acadia-P/A Sherman Avenue, LLCTENANT:HPD or for such other use as the Commissioner of the Departmentof Citywide Administrative Services (“DCAS”) may determine inaccordance with the use provision (to be negotiated).PREMISES:4650 BroadwayBorough of ManhattanSPACE:Approximately 39,388 rentable square feet of office, and lobby spaceon the cellar, ground, and fourth floor, which has been verified by theDivision of Real Estate Services.Approximately 3,717 rentable square feet of exclusive ramp accessand garage area parking on the cellar floor.TERM:Twenty (20) years from Substantial Completion as defined belowRENT COMMENCEMENT:Three (3) months following Substantial Completion of alterations andimprovements.BASE RENT: Years 1-5: $37.25 prsf per annumYears 6-10: $42.00 prsf per annumYears 11-15: $47.34 prsf per annumYears 16-20: $53.35 prsf per annum

PARKING RENT:Tenant shall also pay $15.00 per square foot with 10% increasesevery five years, for its designated parking area within the building.The standard City lease provides that rent shall be payable at theend 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 thencurrent 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 paythe Landlord the unamortized portion of the Tenant broker’scommission and the unamortized portion of Landlord’s contributiontowards 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. Tenantshall reimburse the Landlord for its proportionate share (TBD) of anyincrease 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 betweenJanuary 1

and June 30

or the first full calendar year followingSubstantial Completion if it occurs between July 1

and December 31

.OPERATING EXPENSES:Tenant shall reimburse the Landlord for its proportionate share (TBD)of increases in direct operating expenses above the base year. Thebase year shall be (i) the calendar year in which SubstantialCompletion occurs between January 1

and April 30

, (ii) the last half of the calendar year in which Substantial Completion occurs and thefirst half of the following calendar year, if Substantial Completionoccurs between May 1

and August 30

, or (iii) the followingcalendar year, if Substantial Completion occurs between September 1

and December 31

.CONSTRUCTION TIMEFRAME: Landlord intends to demolish an existing structure and build a newbuilding in accordance with the attached project constructiontimeline, Exhibit A.ALTERATIONS &IMPROVEMENTS:Landlord shall, prior to the commencement of the lease term,prepare final architectural plans and engineering plans (the “FinalPlans”) and make alterations and improvements in accordance withpreliminary architectural plans and specifications approved by DCASand by the Agency. The Work consists of (i) alterations andimprovements, including architectural and engineering planstherefore, that the Landlord shall perform at its sole cost andexpense described in the Landlord’s Base Building Scope of Work(“BBW”) and (ii) alterations and improvements that the Landlordshall perform initially at its own cost and expense described in theTenant’s Scope of Work (“TW”). See attached BBW dated January30, 2009.

The total TW cost (defined below) shall not exceed ____. Landlordshall contribute $20/sf towards the TW cost and the Tenant shallreimburse Landlord for the balance up to_______ to be disbursed inone lump sum payment upon the completion of alterations andimprovements. 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 thepreparation of the TW final architectural plans and final engineeringplans (the “Final Plans”) at its sole cost and expense.DESIGN/BIDDING/CONSTRUCTIONPROCEDURES:Plans, bidding and C&S and TW construction shall be done inaccordance with the attached timeline. Both parties agree to adhereto the attached timeline, which shall become a part of the lease.Failure on the part of either party to meet the schedule thereinexcept force majeure shall cause liquidated .damages to incur,pursuant to the provision below.DESIGN/BIDDING/CONSTRUCTIONDEFINITIONS: The TW cost shall consist of all costs and expenses (excludingconstruction loan interest and related financing costs) charged to theLandlord for (a) the DCAS approved Architect's fees for changeorders for the services required for the TW; (b) the filing fees for thesubmission of same (change orders only) to the appropriategovernmental authorities for approval; (c) the performance of allitems of the TW; and (d) one general contractor’s general conditionsfee and one contractor's over-head and profit to the extent indicatedin contractor's bid only; the Landlord shall not be entitled to be paidan 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'scompletion of the Work excepting minor details of construction or decoration which do not adversely affect the Tenant's use of theDemised Premises; and (2) receipt by the Landlord and delivery toDCAS of (i) all applicable Building Department and Fire Departmentinspection sign-offs (including but not limited to Building DepartmentPost Permit TR-1, Equipment Use Permits, a new TemporaryCertificate of Occupancy, electrical and plumbing sign-offs, FireDepartment and elevator inspections and sign-offs and removal of allAsbestos), (ii) certified air balancing report approved by theLandlord's engineer as being in conformance with the Final Plans,and (iii) Certification from the Landlord’s engineer that a directelectric meter to the Premises has been correctly installed.DESIGN/BIDDING/CONSTRUCTIONLIQUIDATED DAMAGES:In the event the Landlord fails to meet its applicable time framesabove then the Tenant shall give the Landlord a written Delay Noticeadvising the Landlord of its failure to so commence, complete and/or perform. If the Landlord fails to commence, complete and/or performthe Work or Final Plans within ten (10) business days from the dateof said notice, the Tenant shall give the Landlord a second writtennotice. If the Landlord fails to commence, complete and/or perform