hanover meadows offering memorandum 2

Hanover Meadows Active Adult Community Development Opportunity New Hanover Township, Montgomery County, PA

Heritage Building Group, Inc.

Charles C. Sturges, IV

Vice President - Land Acquisition & Sales

2500 York Rd.

Jamison, PA 18929

215-491-7771

Table of Contents Confidentiality Statement

I. Executive Summary

II. Project Overview

Hanover Meadows Site Plan

Locator Map

Aerial Map

Approvals

Project Background

Lot Schedule

Master Planned Community Site Plan

Common Site Improvements

III. Hanover Meadows Components Detailed

412-Unit Active Adult Community

204-Unit Senior Apartment Community

254-Unit Continuing Care Retirement Community

IV. Market Analysis

Market Analysis

Active Adult Competitors Analysis

Area Amenities

New Hanover Housing Pipeline

New Hanover Housing Map

V. Appendix

New Hanover Township Order

Conceptual Phasing Plan

Confidentiality StatementConfidentiality Statement

The material contained in this Marketing Book is confidential, furnished solely for the purpose of considering the acquisition of Hanover Meadows (the “Project”) and is not to be used for any other purpose or made available to any other person without the express written consent of Heritage Building Group, Inc (the “Owner”). This material is based upon information supplied by the Owner from sources that are deemed reliable. No warranty or representation, express or implied, is made by the Owner, or any of their affiliates and/or assignees, as to the accuracy or completeness of the information contained herein.

Executive Summary

Executive SummaryHeritage Building Group is proud to present Hanover Meadows; a Master Planned, Mixed-Usedevelopment opportunity, featuring up to 870 units of Age Restricted housing, ideally locatedin New Hanover Township, Montgomery County, PA that is being offered for sale on anapproved basis.

Situated on approximately 215 pristine acres adjacent to Route 663 and Route 73, HanoverMeadows provides an array of highly marketable housing product types to a wide spectrum ofbuyers in a supply-constrained market.

Hanover Meadows promises to be the region’s premiere Age Restricted Community and offersthree distinct development opportunities for: Active Adult home builders, Senior Apartmentbuilders and operators, and Continuing Care Retirement Campus builders and operators, whileminimizing the risk and capital required to develop the project in its entirety. This combinationof uses will allow the end buyers the ability to move seamlessly within one broad campus,between the different components developed by one or multiple builders.

Hanover Meadows consists of three major components that are available to be acquired anddeveloped together or separately from each other:

412 unit Active Adult Retirement Community (“AARC”) with three different types oflots (187 single-family detached lots, 32 twins lots, 197 townhouses lots); this sectionwill be sold with Final Approval and all permits required to begin construction

204 unit multi-family section that can be developed as Senior Apartments or as anActive Adult Condominium Community; this section will be sold with Final Approvaland all permits required to begin construction

254 unit Continuing Care Retirement Community (“CCRC”) consisting of Independentand Assisted Living Facilities; this section will be sold with Conditional Use Approvaland requires the buyer to obtain Final Subdivision and Land Development Approvaland all necessary permits

The Master Planned Community at Hanover Meadows has been designed to maximizeflexibility in the overall development of the site and enables multiple developers theopportunity to acquire different sections, and thereby attracting different segments of themarket, appealing to buyers that are 55-and-better who are searching for lifestyle and value.

Hanover Meadows also boasts the convenience and option for buyers who elect to agegracefully in place in the comfort of one Master Planned Community.

I. Active Adult Retirement Community:Hanover Meadows has been designed to include, or is in close proximity to, the manyamenities that are necessary to complement the lifestyles desired by Age Qualified buyers. Inaddition to designing the project to provide a clubhouse area that will be up to 16,000 squarefeet, and providing areas for a large swimming pool, walking trails, bocce and shuffleboardcourts, three golf courses are located within a short drive of the AARC. Every detail atHanover Meadows Active Adult Community was carefully designed to provide the resort-styleliving that will attract future residents of the community. Hanover Meadows provides adistinct, Active Adult-oriented lifestyle choice, rather than simply a place to live

Hanover Meadows consists of three different housing types that will offer Active Adultresidents a wide selection and range of housing options.

Singles 8,000 64 128 44 73

Twins 5,824 51 109 41 62

Towns 3,720 30 124 30 74

Product TypeTyp. Lot Area

(sq ft)

Typ. Lot Width

(ft)

Typ. Lot

Depth (ft)

Typ. Bldg. Env.

Width (ft)

Typ. Bldg. Env.

Depth (ft)

II. Senior Apartments/Condominiums:Attractively designed apartments marketed solely for seniors are in short supply in the region.Hanover Meadows is very unique in its design and features a 204 unit component that iscomprised entirely of senior apartments that can be leased to this growing segment of themarket. Alternatively, the 204 units can be sold as condominiums. This component can bepurchased separately from the Master Planned community with the possibility of employing ashared amenities package with the developer of the Active Adult Retirement Community.

III. Continuing Care Retirement Campus:Hanover Meadows also features a 254 unit Continuing Care Retirement Campus (CCRC) thatcan be acquired separately from the balance of the site. The CCRC component has ConditionalUse Approval to develop Independent Living and Assisted Living Facilities that are naturallybuffered from the adjacent uses. A brand new YMCA is in operation a short distance from theCCRC component, which will ultimately provide a new layer of convenience and moreopportunities for the residents of Hanover Meadows to engage in activities and to interact withtheir neighbors.

Building Type Lot Size

Sq. Ft.*

Independent Living 190 209 11 Acres

Full Care 64 128 5 Acres

Total: 254 337 16 Acres

*Number of beds is dependent upon the number of parking spaces that will be provided

Number of

Units

Number of

Beds*

Ideally located in New Hanover Township, the three components at Hanover Meadows arecompetitively positioned for success within the Age Restricted market. By the year 2010, NewHanover Township’s population is expected to increase by 25%, the 5th largest percentageincrease within Montgomery County. Even more astounding, New Hanover is expected toundergo a 98% increase in population by 2025, marking the single largest percent increase ofany municipality in Montgomery County. Hanover Meadows is not only located in one of thefastest growing municipalities but is situated within a municipality located in one of the mostrapidly aging geographic areas in the entire state. Twenty percent of the current residents inNew Hanover qualify for age restricted housing and as a result, is potentially in the market fora new home in an Active Adult Community such as Hanover Meadows.

New Hanover Township’s unique location in Montgomery County, equidistant to Berks,Bucks, Chester, Lehigh and Philadelphia Counties ensures that future residents will haveaccess to the desirable destinations and amenities of all six counties, including corporatecampuses, healthcare facilities, recreation areas, vast retail locations, educationalestablishments, museums and other cultural institutions, via a superior network of highwaysand by public transportation for non-driving residents.

To further meet the needs of the residents of Hanover Meadows and the Township, HeritageBuilding Group has also obtained the necessary approvals to develop of a 275,000 square footshopping center (New Hanover Crossing) adjacent to Hanover Meadows. Proposed tenantswill include a grocery store, a pharmacy, a bank and a casual dining restaurant, among otherretail stores.

Hanover Meadows is proudly offered to the development community in three sections withpricing as follows:

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This visionary land plan integrates three different and distinct housing options which willtarget a wider range of potential buyers for Active Adult and Continuing Care housing, andlessees of Senior Apartments. The synergy that can be captured between these three sections isprojected to increase absorption rates, unit prices, and maintain higher occupancy rates whilealso providing the unique opportunity for residents to age gracefully and comfortably in onelocation.

The following material is a synopsis of the information relative to the property and provides detailed informationpertaining to Lot Information, Location Maps, a Market Analysis and Site Plans. A complete plan set is availableupon request. The information has been obtained from sources deemed reliable. However, Heritage BuildingGroup, Inc. makes no representation with respect to the accuracy of this information.

Project Overview

Hanover Meadows

Project BackgroundLocation Map

Driving Directions:

From Route 422: Take the Sanatoga exit of Route 422. Turn left onto E. High Street for .5 miles and turn right ontoN. Sanatoga Rd. Go 1.2 miles and turn right onto N. Pleasant View Rd. N. Pleasant View Rd. becomes Sanatoga Rd.again after .8 miles. Turn left onto Swamp Pike Rd and continue for about 2 miles. Turn Right onto North Charlotte(Route 663). Hanover Meadows will be on your right.

From the Northeast Extension (I-476): Take Exit #44 of the Northeast Extension (I-476) onto PA-663 towardPottstown approximately 12.1 miles. Turn left onto Big Road (PA-73) and travel about 1 mile to arrive at HanoverMeadows.

Hanover Meadows

Aerial Map

Approvals:

Currently a Joint 105 Permit and a Highway Occupancy Permit remain outstanding but bothwill be procured by the Seller prior to Closing. Hanover Meadows will be sold with allapplicable approvals and permits in place for the 412 Active Adult units and the 204 SeniorApartments/Condominiums. It is estimated that these units may begin construction inNovember 2008. Public sanitary sewer treatment is available to the property, pursuant to thecompletion of a plant expansion by the New Hanover Township Sewer Authority. Constructionmay begin on the 254 unit Continuing Care Retirement Community after the Buyer hasreceived all necessary approvals and permits.

Project Background:

In addition to Hanover Meadows, Heritage Building Group is developing two adjacentprojects: Hanover Glen - a 40 lot detached single family home community; and New HanoverCrossing – a 275,000 retail shopping center. The development of these projects will requirethe construction of certain common off-site improvements which include highwayimprovements along Routes 73 and 663, off-site sewer lines, the extension of Miles Road, anda gas line approach.

With respect to the Highway Improvements, each project will have an individual Penn DOTpermit, however, the three individual permits will have an overlapping scope of work.Heritage has developed cost estimates for these common off-site improvements and hasassigned contributions and reimbursements for each respective project to facilitate and insurethe necessary funding for the construction of the off-site improvements. The builder(s) ofHanover Meadows will be responsible for the scope of work required by its respective PennDOT permit, including posting required financial security, and will receive a reimbursementfor the overlap work in the event Hanover Meadows starts before either or both of thecontiguous projects. Likewise, in the event one or both of the contiguous projects starts beforeHanover Meadows then the builder(s) of Hanover Meadows will make a contribution for thecost of common off-site improvements constructed by the other builder(s).

For the Hanover Meadows project, the assigned reimbursements and contributions forcommon off-site improvements are as follows:

If Hanover Meadows Starts First - The builder(s) of Hanover Meadows will receive a totalreimbursement of $535,000 consisting of: $200,000 for the gas line approach from the builderof Hanover Glen and the builder of New Hanover Crossing plus an additional $335,000 for theHighway Improvement overlap with New Hanover Crossing. These reimbursements will besecured by a cash escrow to be posted by the Seller at the closing of the sale of HanoverMeadows. Each component of the reimbursement will be paid in two stages, 50% will befunded when the work is 50% complete and the balance of the reimbursement when the workis substantially complete.

If One or Both of the Other Contiguous Projects Starts Before Hanover Meadows – Thebuilder(s) of Hanover Meadows will be responsible for a total potential contribution of$597,500 for common off-site improvements if both of the other projects start prior to HanoverMeadows. The components of the $597,500 are: $262,500 for the gas line approach if thebuilder of Hanover Glen starts prior to Hanover Meadows and $335,000 for HighwayImprovement overlap with the builder of New Hanover Crossing.

The purchaser(s) of Hanover Meadows will have to secure its/their total potential contributionof $597,500 by providing acceptable financial security. Contribution amounts will be due onlyin the event construction of common off-site improvements are commenced by anotherbuilder(s) prior to the start of construction of Hanover Meadows. The $597,500 contributionmay be reduced depending on the order of each project starting.

In the event Hanover Meadows starts before one or both of the other projects and the buyer(s)of Hanover Meadows undertakes construction of the common off-site improvements then thecontribution/financial security amount will be modified or cancelled.

The contribution for each component of the common off-site improvements will be payable intwo stages, 50% will be funded when the work is 50% complete and the balance of thereimbursement when the work is substantially complete.

The amounts of reimbursements and contributions are fixed amounts. The builder of eachproject will be responsible for estimating the costs for off-site improvements which may berequired to be constructed at the start of each project but the reimbursement and contributionamounts set forth above will be fixed amounts.

HANOVER MEADOWS

1 Single 8,014 60.00 124.00 44.00 60.00

2 Single 9,293 60.00 125.00 40.00 64.00

3 Single 11,067 60.00 141.00 40.00 80.00

4 Single 10,693 58.00 146.00 40.00 62.00

5 Single 9,216 64.00 144.00 44.00 74.00

6 Single 9,216 64.00 144.00 44.00 74.00

7 Single 9,216 64.00 144.00 44.00 74.00

8 Single 9,216 64.00 144.00 44.00 74.00

9 Single 9,216 64.00 144.00 44.00 74.00

10 Single 9,216 64.00 144.00 44.00 74.00

11 Single 9,072 63.00 144.00 43.00 74.00

12 Single 9,072 64.00 144.00 44.00 74.00

13 Single 11,451 70.00 135.00 44.00 84.00

14 Single 13,848 78.38 193.00 44.00 54.00

15 Single 10,620 85.18 124.00 44.00 69.00

16 Single 7,936 64.00 124.00 44.00 74.00

17 Single 7,936 64.00 124.00 44.00 74.00

18 Single 7,936 64.00 124.00 44.00 74.00

19 Single 7,936 64.00 124.00 44.00 74.00

20 Single 10,019 62.00 120.00 42.00 68.00

21 Single 8,615 62.00 120.00 42.00 69.00

22 Single 8,777 65.00 124.00 45.00 69.00

23 Single 9,924 66.00 124.00 40.00 68.00

24 Single 10,329 65.00 124.00 44.00 70.00

25 Single 10,979 62.00 127.00 42.00 70.00

26 Single 10,244 64.00 126.00 44.00 68.00

27 Single 7,924 64.00 124.00 44.00 68.00

28 Single 9,545 77.00 124.00 57.00 68.00

29 Single 7,936 64.00 124.00 44.00 68.00

30 Single 9,734 78.50 124.00 54.00 68.00

31 Single 10,540 85.00 124.00 55.00 68.00

32 Single 7,936 64.00 124.00 44.00 68.00

33 Single 9,896 80.00 124.00 55.00 68.00

34 Single 9,662 78.00 124.00 53.00 69.00

35 Single 7,811 62.99 124.00 43.00 69.00

36 Single 7,396 64.00 124.00 44.00 69.00

37 Single 7,936 64.00 124.00 44.00 69.00

Lot Area (sqft)

Lot No. Product TypeBldg. Env. Depth

(ft)Bldg. Env.Width (ft)

Lot Depth(ft)

Lot Width (ft)@ BSBL

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


38 Single 10,580 83.50 124.00 44.00 69.00

39 Single 7,937 64.00 124.00 44.00 69.00

40 Single 7,955 64.00 124.00 44.00 69.00

41 Single 7,954 64.00 123.99 44.00 69.00

42 Single 7,935 64.00 123.99 44.00 69.00

43 Single 7,935 64.00 123.99 44.00 69.00

44 Single 10,800 87.11 122.02 54.00 69.00

45 Single 7,936 64.00 124.00 44.00 69.00

46 Single 7,688 62.00 124.00 42.00 69.00

47 Single 9,569 78.00 124.00 52.00 69.00

48 Single 8,336 64.00 127.65 44.00 64.00

49 Single 8,532 65.71 130.50 44.00 75.00

50 Single 8,352 64.00 130.50 44.00 75.00

51 Single 8,221 63.00 130.50 43.00 75.00

52 Single 8,192 64.00 128.00 44.00 73.00

53 Single 11,499 90.00 128.00 54.00 73.00

54 Single 8,196 64.03 128.00 44.00 73.00

55 Single 8,196 64.03 128.00 44.00 73.00

56 Single 8,196 64.03 128.00 44.00 73.00

57 Single 8,196 64.03 128.00 44.00 73.00

58 Single 8,196 64.03 128.00 44.00 73.00

59 Single 13,801 120.00 128.00 45.00 73.00

60 Single 10,989 85.00 128.00 40.00 73.00

61 Single 8,773 60.00 128.00 40.00 73.00

62 Single 10,061 60.00 128.00 40.00 73.00

63 Single 10,494 61.00 134.00 41.00 78.00

64 Single 9,909 66.00 128.00 41.00 73.00

65 Single 8,192 64.00 128.00 44.00 73.00

66 Single 8,704 68.00 128.00 44.00 73.00

67 Single 10,693 84.00 128.00 59.00 73.00

68 Single 9,891 56.00 125.00 36.00 70.00

69 Single 10,005 56.00 128.00 36.00 69.00

70 Single 8,030 64.00 124.00 44.00 69.00

71 Single 7,936 64.00 124.00 44.00 69.00

72 Single 7,936 64.00 124.00 44.00 69.00

73 Single 7,940 64.00 124.00 44.00 69.00

74 Single 8,546 64.00 130.00 44.00 76.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


75 Single 15,951 60.00 170.00 40.00 80.00

76 Single 23,419 60.00 220.00 40.00 80.00

77 Single 14,110 64.00 150.00 44.00 66.00

78 Single 8,908 64.00 139.00 44.00 70.00

79 Single 8,921 64.00 139.00 44.00 70.00

80 Single 8,926 64.00 139.00 44.00 70.00

81 Single 10,066 64.00 139.00 44.00 70.00

82 Single 15,777 66.00 150.00 46.00 72.00

83 Single 19,083 75.00 126.00 54.00 52.00

84 Single 16,180 60.00 156.00 45.00 85.00

85 Single 9,192 100.00 124.00 40.00 54.00

86 Single 7,979 64.00 124.00 44.00 69.00

87 Single 7,962 64.00 124.00 44.00 69.00

88 Single 8,003 64.00 124.00 44.00 69.00

89 Single 10,817 140.00 124.00 40.00 55.00

90 Single 8,014 64.00 123.00 44.00 68.00

91 Single 7,934 64.00 123.97 44.00 69.00

92 Single 7,934 64.00 123.97 44.00 69.00

93 Single 10,613 112.00 110.00 44.00 54.00

94 Single 11,834 91.00 125.00 61.00 68.00

95 Single 10,768 65.00 112.00 44.00 64.00

96 Single 8,211 64.00 110.00 44.00 64.00

97 Single 11,581 66.00 126.00 44.00 65.00

98 Single 10,849 70.00 157.00 44.00 103.00

99 Single 11,967 144.00 120.00 44.00 60.00

100 Single 8,746 64.00 126.84 44.00 71.00

101 Single 11,414 9001.00 126.78 70.00 71.00

102 Single 8,114 64.01 126.74 44.00 71.00

103 Single 8,111 64.01 126.70 44.00 71.00

104 Single 8,109 64.01 126.66 44.00 71.00

105 Single 8,030 64.00 126.00 44.00 71.00

106 Single 11,554 120.00 110.00 44.00 48.00

107 Single 12,076 61.00 150.00 40.00 100.00

108 Single 9,543 65.00 130.00 44.00 72.00

109 Single 7,980 64.00 125.00 44.00 71.00

110 Single 8,000 64.00 125.00 44.00 71.00

111 Single 8,000 64.00 125.00 44.00 71.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


112 Single 8,000 64.00 125.00 44.00 71.00

113 Single 8,000 64.00 125.00 44.00 71.00

114 Single 8,000 64.00 125.00 44.00 71.00

115 Single 8,000 64.00 125.00 44.00 71.00

116 Single 8,000 64.00 125.00 44.00 71.00

117 Single 7,750 62.00 125.00 42.00 71.00

118 Single 10,291 82.50 125.00 57.50 71.00

119 Single 10,041 80.50 125.00 55.50 70.00

120 Single 8,000 64.00 125.00 44.00 70.00

121 Single 8,000 64.00 125.00 44.00 70.00

122 Single 8,000 64.00 125.00 44.00 70.00

123 Single 8,000 64.00 125.00 44.00 70.00

124 Single 8,000 64.00 125.00 44.00 70.00

125 Single 8,000 64.00 125.00 44.00 70.00

126 Single 8,000 64.00 125.00 44.00 70.00

127 Single 8,000 64.00 125.00 44.00 70.00

128 Single 8,000 64.00 125.00 44.00 70.00

129 Single 8,000 64.00 125.00 44.00 70.00

130 Single 8,000 64.00 125.00 44.00 70.00

131 Single 8,000 64.00 125.00 44.00 70.00

132 Single 8,000 64.00 125.00 44.00 70.00

133 Single 8,000 64.00 125.00 44.00 70.00

134 Single 8,000 64.00 125.00 44.00 70.00

135 Single 9,600 64.00 136.00 44.00 66.00

136 Single 8,670 64.00 136.00 44.00 66.00

137 Single 8,704 64.00 136.00 44.00 66.00

138 Single 8,704 64.00 136.00 44.00 66.00

139 Single 8,686 64.00 136.00 44.00 67.00

140 Single 10,850 81.23 135.42 44.00 80.00

141 Single 9,011 64.00 141.00 44.00 71.00

142 Single 9,024 64.00 141.00 44.00 71.00

143 Single 9,024 64.00 141.00 44.00 71.00

144 Single 9,024 64.00 141.00 44.00 71.00

145 Single 9,024 64.00 141.00 44.00 71.00

146 Single 9,024 64.00 141.00 44.00 71.00

147 Single 9,024 64.00 141.00 44.00 71.00

148 Single 9,024 64.00 141.00 44.00 71.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


149 Single 9,024 64.00 141.00 44.00 71.00

150 Single 9,024 64.00 141.00 44.00 71.00

151 Single 9,024 64.00 141.00 44.00 71.00

152 Single 9,024 64.00 141.00 44.00 71.00

153 Single 9,024 64.00 141.00 44.00 71.00

154 Single 9,024 64.00 141.00 44.00 71.00

155 Single 9,024 64.00 141.00 44.00 71.00

156 Single 9,027 64.00 141.00 44.00 71.00

157 Single 8,792 64.00 139.00 44.00 69.00

158 Single 8,508 64.98 130.52 44.98 68.00

159 Single 11,482 90.00 128.00 54.00 73.00

160 Single 8,192 63.99 128.00 44.00 73.00

161 Single 8,192 64.00 128.00 44.00 73.00

162 Single 8,192 64.00 128.00 44.00 73.00

163 Single 8,192 64.00 128.00 44.00 73.00

164 Single 8,192 64.00 128.00 44.00 73.00

165 Single 8,192 64.00 128.00 44.00 73.00

166 Single 8,196 63.00 128.00 44.00 73.00

167 Single 8,192 64.00 128.00 44.00 73.00

168 Single 8,445 64.00 128.00 44.00 73.00

169 Single 8,183 64.00 128.00 44.00 73.00

170 Single 8,832 69.00 128.00 44.00 73.00

171 Single 8,192 64.00 128.00 44.00 73.00

172 Single 8,192 64.00 128.00 44.00 73.00

173 Single 8,192 64.00 128.00 44.00 73.00

174 Single 8,192 64.00 128.00 44.00 73.00

175 Single 8,192 64.00 128.00 44.00 73.00

176 Single 8,192 64.00 128.00 44.00 73.00

177 Single 8,832 69.00 128.00 44.00 73.00

178 Single 10,657 100.00 128.00 44.00 70.00

179 Single 8,806 64.00 128.00 44.00 73.00

180 Single 8,289 64.00 128.00 44.00 73.00

181 Single 8,192 64.00 128.00 44.00 73.00

182 Single 8,192 64.00 128.00 44.00 73.00

183 Single 8,192 64.00 128.00 44.00 73.00

Typ. 8,000 64 128 44 73

Avg. 9,236 116.71 130.46 44.59 70.68

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


184 Twin 8,262 75.00 109.00 45.00 59.00

185 Twin 5,865 54.00 109.00 41.00 59.00

186 Twin 6,519 47.00 109.00 37.00 59.00

187 Twin 6,736 50.00 124.00 40.00 70.00

188 Twin 14,732 45.00 168.00 35.00 100.00

189 Twin 7,624 52.00 137.00 42.00 84.00

190 Twin 7,869 47.00 112.00 37.00 62.00

191 Twin 5,824 52.00 112.00 42.00 62.00

192 Twin 5,824 52.00 112.00 42.00 62.00

193 Twin 5,824 52.00 111.99 42.00 62.00

194 Twin 5,823 52.00 111.99 42.00 61.00

195 Twin 5,857 52.00 111.99 42.00 61.00

196 Twin 7,812 47.00 110.75 37.00 61.00

197 Twin 5,795 50.00 110.75 40.00 61.00

198 Twin 7,374 43.00 117.93 33.00 66.00

199 Twin 7,084 47.00 117.93 37.00 66.00

200 Twin 6,946 54.00 123.53 44.00 62.00

201 Twin 9,298 75.00 120.00 44.00 62.00

202 Twin 9,064 75.00 119.32 44.00 69.00

203 Twin 7,084 58.00 119.32 48.00 69.00

204 Twin 6,878 51.87 132.00 42.00 81.00

205 Twin 6,865 52.99 128.00 42.00 79.00

206 Twin 10,569 74.00 139.60 45.00 75.00

207 Twin 7,313 52.00 139.60 42.00 90.00

208 Twin 6,128 51.00 118.29 41.00 61.00

209 Twin 6,177 51.00 118.00 41.00 62.00

210 Twin 6,350 51.00 120.00 41.00 66.00

211 Twin 6,496 51.00 127.92 41.00 68.00

212 Twin 6,540 51.00 128.51 41.00 71.00

213 Twin 6,574 51.00 129.22 41.00 71.00

214 Twin 6,607 51.00 129.87 41.00 72.00

215 Twin 6,640 51.00 129.87 41.00 73.00

216 Twin 7,904 45.00 170.00 30.00 96.00

Typ. 5,824 51 109 41 62

Avg. 7,220 53.42 123.59 40.70 69.15

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


217 Town 4,706 30.00 150.00 30.00 84.00

218 Town 4,407 30.00 143.00 30.00 74.00

219 Town 4,258 30.00 141.00 30.00 74.00

220 Town 6,337 30.00 140.00 30.00 74.00

221 Town 6,543 30.00 140.00 30.00 74.00

222 Town 4,394 30.00 144.00 30.00 74.00

223 Town 4,498 30.00 148.00 30.00 74.00

224 Town 7,184 30.00 110.00 30.00 74.00

225 Town 8,182 35.00 124.00 35.00 74.00

226 Town 3,720 30.00 124.00 30.00 74.00

227 Town 3,720 30.00 124.00 30.00 74.00

228 Town 3,720 30.00 124.00 30.00 74.00

229 Town 4,684 30.00 124.00 30.00 74.00

230 Town 9,174 34.00 130.00 34.00 80.00

231 Town 5,469 30.00 180.00 30.00 70.00

232 Town 5,189 30.00 170.00 30.00 115.00

233 Town 4,830 30.00 160.00 30.00 100.00

234 Town 9,393 30.00 140.00 30.00 80.00

235 Town 4,956 40.00 124.00 30.00 74.00

236 Town 3,707 30.00 124.00 30.00 74.00

237 Town 3,720 30.00 124.00 30.00 74.00

238 Town 3,720 30.00 124.00 30.00 74.00

239 Town 5,699 45.96 124.00 30.00 74.00

240 Town 5,828 47.00 124.00 30.00 74.00

241 Town 3,720 30.00 124.00 30.00 74.00

242 Town 3,720 30.00 124.00 30.00 74.00

243 Town 3,720 30.00 124.00 30.00 74.00

244 Town 5,580 45.00 124.00 30.00 74.00

245 Town 5,828 47.00 124.00 30.00 74.00

246 Town 3,720 30.00 124.00 30.00 74.00

247 Town 3,720 30.00 124.00 30.00 74.00

248 Town 3,720 30.00 124.00 30.00 74.00

249 Town 5,884 47.00 124.00 30.00 74.00

250 Town 5,735 45.00 126.78 30.00 76.00

251 Town 3,910 30.00 128.54 30.00 78.00

252 Town 4,111 30.00 133.48 30.00 78.00

253 Town 4,621 30.00 146.00 30.00 80.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


254 Town 10,228 49.00 172.00 30.00 82.00

255 Town 6,091 49.00 124.65 30.00 74.00

256 Town 3,740 30.00 124.65 30.00 74.00

257 Town 5,111 41.00 124.65 30.00 74.00

258 Town 5,580 45.00 124.00 30.00 74.00

259 Town 3,709 30.00 124.00 30.00 74.00

260 Town 5,355 37.00 124.00 30.00 74.00

261 Town 9,248 30.00 132.00 30.00 74.00

262 Town 3,899 30.00 124.00 30.00 74.00

263 Town 3,664 30.00 124.00 30.00 74.00

264 Town 8,177 65.00 124.00 35.00 74.00

265 Town 11,634 30.00 130.00 30.00 75.00

266 Town 3,901 30.00 130.00 30.00 80.00

267 Town 3,901 30.00 120.00 30.00 80.00

268 Town 3,901 30.00 130.03 30.00 80.00

269 Town 6,112 47.00 130.03 30.00 80.00

270 Town 5,591 43.00 130.03 30.00 80.00

271 Town 3,901 30.00 130.03 30.00 80.00

272 Town 10,759 30.00 130.03 30.00 74.00

273 Town 7,046 56.00 124.00 42.00 74.00

274 Town 3,720 30.00 124.00 30.00 74.00

275 Town 3,720 30.00 124.00 30.00 74.00

276 Town 3,720 30.00 124.00 30.00 74.00

277 Town 4,960 40.00 124.00 30.00 74.00

278 Town 11,856 80.00 124.00 70.00 74.00

279 Town 3,720 30.00 124.00 30.00 74.00

280 Town 3,720 30.00 124.00 30.00 74.00

281 Town 3,720 30.00 124.00 30.00 74.00

282 Town 8,175 65.00 124.00 35.00 74.00

283 Town 5,126 40.00 128.00 30.00 74.00

284 Town 3,954 30.00 128.00 30.00 74.00

285 Town 4,158 30.00 135.00 30.00 74.00

286 Town 4,565 30.00 148.00 30.00 74.00

287 Town 10,928 30.00 170.00 30.00 74.00

288 Town 4,584 35.00 126.00 30.00 74.00

289 Town 3,780 30.00 126.00 30.00 74.00

290 Town 3,780 30.00 126.00 30.00 74.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


291 Town 3,780 30.00 126.00 30.00 74.00

292 Town 8,055 64.00 126.00 34.00 74.00

293 Town 4,270 35.00 122.00 30.00 74.00

294 Town 3,660 30.00 122.00 30.00 74.00

295 Town 3,660 30.00 122.00 30.00 74.00

296 Town 3,660 30.00 122.00 30.00 74.00

297 Town 7,799 64.00 122.00 34.00 74.00

298 Town 8,164 65.00 124.00 36.00 74.00

299 Town 3,720 30.00 124.00 30.00 74.00

300 Town 3,720 30.00 124.00 30.00 74.00

301 Town 3,720 30.00 124.00 30.00 74.00

302 Town 5,580 45.00 124.00 30.00 74.00

303 Town 5,580 45.00 124.00 30.00 74.00

304 Town 3,663 30.00 124.00 30.00 74.00

305 Town 5,637 40.00 128.00 30.00 74.00

306 Town 8,266 25.00 152.00 30.00 110.00

307 Town 4,731 30.00 159.00 30.00 110.00

308 Town 7,684 45.00 163.00 30.00 110.00

309 Town 8,175 65.00 124.00 34.00 74.00

310 Town 3,720 30.00 124.00 30.00 74.00

311 Town 3,720 30.00 124.00 30.00 74.00

312 Town 3,720 30.00 124.00 30.00 74.00

313 Town 5,307 42.80 124.00 30.00 74.00

314 Town 10,483 120.00 115.00 30.00 80.00

315 Town 4,189 30.00 135.00 30.00 80.00

316 Town 4,228 30.00 140.93 30.00 80.00

317 Town 4,228 30.00 140.93 30.00 80.00

318 Town 9,099 50.00 140.93 30.00 80.00

319 Town 6,868 63.00 124.00 30.00 74.00

320 Town 3,720 30.00 124.00 30.00 74.00

321 Town 3,720 30.00 124.00 30.00 74.00

322 Town 3,720 30.00 124.00 30.00 74.00

323 Town 8,175 65.00 124.00 35.00 74.00

324 Town 4,960 40.00 124.00 30.00 74.00

325 Town 3,720 30.00 124.00 30.00 74.00

326 Town 3,720 30.00 124.00 30.00 74.00

327 Town 3,720 30.00 124.00 30.00 74.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


328 Town 8,175 65.00 124.00 35.00 74.00

329 Town 11,625 110.00 113.80 30.00 78.00

330 Town 3,414 30.00 113.80 30.00 78.00

331 Town 5,121 45.00 113.80 30.00 78.00

332 Town 5,121 45.00 113.80 30.00 78.00

333 Town 3,414 30.00 113.80 30.00 78.00

334 Town 4,552 37.00 113.80 30.00 78.00

335 Town 8,414 68.00 131.00 38.00 81.00

336 Town 3,930 30.00 131.00 30.00 81.00

337 Town 3,930 30.00 131.00 30.00 81.00

338 Town 8,721 75.00 112.15 30.00 81.00

339 Town 5,676 46.41 124.00 30.00 74.00

340 Town 3,720 30.00 124.00 30.00 74.00

341 Town 3,720 30.00 124.00 30.00 74.00

342 Town 3,720 30.00 124.00 30.00 74.00

343 Town 4,960 40.00 124.00 30.00 44.00

344 Town 7,044 43.60 163.00 30.00 82.00

345 Town 4,859 30.00 160.00 30.00 81.00

346 Town 4,796 30.00 158.00 30.00 76.00

347 Town 4,658 30.00 154.00 30.00 74.00

348 Town 7,084 46.00 154.00 30.00 74.00

349 Town 7,084 46.00 154.00 30.00 74.00

350 Town 4,620 30.00 154.00 30.00 74.00

351 Town 4,620 30.00 154.00 30.00 74.00

352 Town 7,084 46.00 154.00 30.00 74.00

353 Town 7,852 40.00 143.00 30.00 72.00

354 Town 4,800 30.00 143.00 30.00 72.00

355 Town 9,594 35.00 122.00 30.00 72.00

356 Town 4,989 40.00 124.00 30.00 74.00

357 Town 3,714 30.00 124.00 30.00 74.00

358 Town 3,714 30.00 124.00 30.00 74.00

359 Town 8,321 65.00 124.00 35.00 74.00

360 Town 11,553 79.00 130.00 37.00 80.00

361 Town 3,900 30.00 130.00 30.00 80.00

362 Town 3,900 30.00 130.00 30.00 80.00

363 Town 3,900 30.00 130.00 30.00 80.00

364 Town 5,850 45.00 130.00 30.00 80.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


365 Town 5,980 46.00 130.00 30.00 80.00

366 Town 3,900 30.00 130.00 30.00 80.00

367 Town 3,900 30.00 130.00 30.00 80.00

368 Town 3,900 30.00 130.00 30.00 80.00

369 Town 5,980 46.00 130.00 30.00 80.00

370 Town 14,359 62.00 126.00 30.00 70.00

371 Town 3,710 30.00 125.00 30.00 74.00

372 Town 3,716 30.00 125.00 30.00 74.00

373 Town 7,330 35.00 129.00 30.00 79.00

374 Town 7,788 39.00 130.00 30.00 75.00

375 Town 3,917 30.00 130.13 30.00 76.00

376 Town 3,904 30.00 130.13 30.00 76.00

377 Town 3,904 30.00 130.13 30.00 76.00

378 Town 5,986 46.00 130.13 30.00 77.00

379 Town 5,861 45.00 130.13 30.00 77.00

380 Town 3,904 30.00 130.13 30.00 78.00

381 Town 3,847 30.00 130.13 30.00 78.00

382 Town 4,076 30.00 132.00 30.00 81.00

383 Town 9,777 30.00 145.00 30.00 91.00

384 Town 10,373 30.00 160.00 30.00 110.00

385 Town 4,424 30.00 145.00 30.00 91.00

386 Town 8,616 42.00 145.00 30.00 80.00

387 Town 6,111 39.00 154.13 30.00 74.00

388 Town 4,624 30.00 154.13 30.00 74.00

389 Town 4,624 30.00 154.13 30.00 74.00

390 Town 4,624 30.00 154.13 30.00 74.00

391 Town 8,140 43.00 154.13 30.00 74.00

392 Town 8,445 36.00 158.61 30.00 79.00

393 Town 5,594 30.00 178.00 30.00 95.00

394 Town 10,678 37.00 130.00 30.00 110.00

395 Town 7,035 30.00 135.00 30.00 36.00

396 Town 4,480 30.00 143.23 30.00 86.00

397 Town 4,297 30.00 143.23 30.00 93.00

398 Town 6,445 30.00 143.23 30.00 93.00

399 Town 6,445 30.00 143.23 30.00 93.00

400 Town 4,297 30.00 143.23 30.00 93.00

401 Town 4,297 30.00 143.23 30.00 93.00

HANOVER MEADOWS

Lot Area (sqft)



Lot Depth(ft)


402 Town 4,484 30.00 143.23 30.00 87.00

403 Town 6,983 30.00 135.00 30.00 42.00

404 Town 8,590 30.00 143.97 30.00 93.00

405 Town 4,319 30.00 143.97 30.00 93.00

406 Town 4,319 30.00 143.97 30.00 93.00

407 Town 4,319 30.00 143.97 30.00 93.00

408 Town 6,479 30.00 143.97 30.00 93.00

409 Town 6,479 30.00 143.97 30.00 93.00

410 Town 4,319 30.00 143.97 30.00 93.00

411 Town 4,505 30.00 141.00 30.00 88.00

412 Town 7,073 30.00 135.00 30.00 38.00

Typ. 3,720 30 124 30 74

Avg. 7,313 73.73 130.97 37.67 73.80

Hanover Meadows Components Detailed

I. Active Adult Retirement Community

The potential market for Active Adult Communities is diverse and controls substantial wealth.Active Adult Communities appeal to empty nesters and retirees that are living in homes thathave often become too large, too difficult to maintain, too lonely as their neighbors and friendsleave and are replaced by younger, less compatible neighbors.

The 412-unit Active Adult Retirement Community at Hanover Meadows is strategicallypositioned to have a distinct competitive advantage over other AARCs in the region, as a directresult of a clear and concise understanding of the Active Adult consumer. This project,specifically tailored to the “55-and-better” market, capitalizes upon extensive market researchthat effectively guided design decisions and determined exactly what development standardsshould be required and which products and amenities need to be offered to ensure the viabilityand successful build-out of Hanover Meadows Active Adult Retirement Community.

Hanover Meadows Active Adult Retirement Community consists of three different producttypes within the community, offering Active Adult buyers a clear choice in selecting the housetype that best meets their spatial and pricing needs. Single family-detached lots, townhouselots, and twin lot sizes are as specified below.

Building Type

Singles 183 8,000 64 128 44 73

Townhouse 197 3,720 30 124 30 74

Twins 32 5,824 51 109 41 62

Total: 412

Number of

Units

Typ. Lot

Area (sq ft)

Typ. Lot

Width (ft)

Typ. Lot

Depth (ft)

Typ. Bldg. Env.

Width (ft)

Typ. Bldg. Env.

Depth (ft)

The image that is created at the main entrance to an AARC is very important to retirees; theentrance serves as the front door to their new lives, and it should reinforce their sense of whatthe community is like and why they chose to live there. The projected 16,000 square footclubhouse at Hanover Meadows serves not only as the gateway to the community but also asthe physical, social, and symbolic anchor of the community.

Understanding the values and preferences of the Active Adult target market, in an effort toprovide spaces and activities that encourage social interaction and enable residents to pursuetheir various interests, this premier Active Adult community has been specifically designed tofeature a club house up to 16,000 square feet that includes all of the key essentials typicallyfound in an Active Adult community.

The choice and design of community amenities in an Active Adult community is central toestablishing an environment where residents can enjoy the active and sociable lifestyle theyseek. More than any other amenity, the clubhouse is the predominant marketing element in

presenting to sales prospects the potential of the active adult community. The buildingenvelope was intentionally designed to provide the builder with latitude to customize theclubhouse and clubhouse area as desired. Furthermore, the clubhouse area has been oriented toaccommodate a full array of popular outdoor recreational amenities such as designatedshuffleboard and bocce play areas, and a well-appointed swimming pool facility. Additionally,an area located immediately adjacent to the clubhouse has been carefully planned to provide agazebo and walking trail system within a park- like setting, which is strategically linked to avast network of open spaces and walking trails including the unique habitat for a blue heronrookery.

The most popular amenity however, is a relationship with nature. Nature is a key amenity forActive Adults, appealing to their aesthetic sense and contributing to a feeling of both securityand relaxation.

The resort or country-club atmosphere that distinguishes Active Adult communities is createdto a large extent by the quality of the natural or enhanced environmental features such as openspace, trees, water features and landscaping, and the precise way that these features areincorporated into the project design. Hanover Meadows has been carefully designed tocapitalize on the abundant natural resources within the community through a complex systemof walking trails that traverse the grounds, meeting the residents’ desire to exercise and toexperience nature.

The 412 unit Active Adult Retirement Community can be purchased in it’s entirety for a totalof Eleven Million Dollars ($11,000,000). Phasing may be considered.

412 Unit AARC

Alternatively, the sale of this property may contemplate multiple buyers acquiring the differentproduct types and marketing simultaneously. For example, a Buyer may only be interested inacquiring the detached product, while another builder would select the towns and twins. In thisscenario, the approximate values for each product type are as follows:

Product Type Lots Price Per Lot Total Price

Singles 183 33,000$ 6,038,000$

Twins 32 22,700$ 726,500$

Towns 197 21,500$ 4,235,500$

Total 414 - 11,000,000$

Hanover Meadows AARC - Approximate Price Per Lot

Improvement Costs Summary:

Improvement costs for Hanover Meadows have been estimated and categorized as follows:Common On-Site Improvements, On-Site Improvements, and Common Off-SiteImprovements. The follow is a description and the estimates for each of the costs categories asthey relate to the 412-unit Active Adult Retirement Community. The costs for the other twocomponents have also been quantified when applicable and are further detailed in therespective sections of this prospectus.

In the event that the 412 lot Active Adult Retirement Community is acquired by more than oneBuyer, in addition to paying the per lot cost for the approved lots (land cost) and the cost toimprove the various lots (on-site improvements), the Buyers will be responsible for a pro-ratashare of construction costs, including common off-sites improvements shared with the 254 unitCCRC and the 204 unit Senior Apartments/Condominiums, and common on-site improvementssuch as the entrance, basins, clubhouse area, among other costs related to public utilities andmunicipal fees.

Common On-Site Improvements

The cost to construct the on-site improvements has been calculated for the 616 AARC in itsentirety based on a bid from Brubacher Engineering. The costs that are common to the 412 unitActive Adult Retirement Community, 204 unit Senior Apartment/Condominium section, andthe 254 unit CCRC, such as: basins, emergency access, utility extensions, the area surroundingthe clubhouse etc…collectively referred to as the Common On-Site Improvements, wereisolated from the overall cost to construct and re-distributed on a pro-rata basis.

The balance of the costs contained within the Brubacher Bid, referred to simply as the on-sitecosts, represent the improvements that are specific to the various product types that theseimprovements directly benefit. These costs include: clearing and grubbing, erosion andsediment control, earth work, sanitary sewer, storm sewer, curbs, paving, rock, retaining walls,etc… and are further detailed within this prospectus as the Brubacher Bid. The total estimatedcost for common on-site improvements for the 412 unit AARC is approximately$3,696,741.

These common on-site improvement costs have been further separated pro-rata based onoverall value between the singles, towns, and twins (and the senior apartments/condominiumas further outlined in Section II of this prospectus) as detailed herein.

Per Lot Total

Singles $11,089 $2,029,345

Twins $7,628 $244,099

Towns $7,225 $1,423,297

Total - $3,696,741


In the event that multiple buyers acquire the different components of the site, HeritageBuilding Group may install the on-site improvements that are common to all sections of theproject. The cost of these improvements, plus applicable financing, shall be reimbursed toseller by the Buyers. The repayment structure is yet to be determined, however a phasedrepayment may be considered.

On-Site Improvements:

A construction estimate for on-site improvements has been prepared by Brubacher Excavating,Inc. and is included within this prospectus. The prepared bid is based on the construction of the616 unit Active Adult project in its entirety and does not contemplate phasing. Furthermore,the bid does not include the gas approach, community center, the water contribution toSuperior, or the Full Care / Life Care component. Additional on-site improvements including:Survey, Landscape, Sidewalks, Street Lights, contingency factors, permitting, macadamelevator, etc… were not included in the Brubacher Bid. The buyer(s) of the AARC section willbe responsible for the installation of the on-site improvements. It is recommended thatprospective buyers perform their own estimate to verify the improved lot costs, taking intoaccount cost differentials due to construction sequence for phased construction.

Public water to this property is available and is provided by Superior Water Company. Thereare no connection fees, only construction cost contributions. The water main lines in HanoverMeadows are to be installed by Superior Water Company. Full amount of the water lineextension is typically paid by Buyer to Superior Water Company up front at the start ofconstruction. The cost of the water main line is included within the on-site improvement costs.

On-site improvement costs for the 412-unit AARC have been extrapolated from theaforementioned Brubacher Excavating and Superior Water Company bids. In total, the on-siteimprovement costs for the AARC are $16,612,783. The costs have been further calculatedbased on product type (singles, towns, twins) as follows:

Per Lot Total

Singles $54,845 $10,036,636

Twins $20,355 $651,372

Towns $30,075 $5,924,775

Total - $16,612,783

On-Site Improvements

Common Off-Site Improvements –

Within the immediate vicinity of the 616 unit AARC (including the senior apartments) and the254 Unit CCRC components of the project, Heritage Building Group is simultaneouslydeveloping a 40 lot single-family residential project, and a 275,000 square foot commercialproject, that also require certain improvements to areas outside of their respective properties.The scope of work for these projects, particularly the improvements necessary for Route 663and Route 73, may overlap between the projects. As such, Heritage Building Group may installthe off-site improvements to be reimbursed by the Buyers of the various components.

Heritage has estimated the cost of the off-site improvements that are common to the projectand have re-distributed the costs among the various components on a pro-rata basis basedprimarily on road frontage.

Additionally, there are road improvements such as: the widening of Church Road that willprimarily benefit the 412 unit AARC and 204 unit Senior Apartments.

In total, the estimated off-site improvement costs for the 412 unit AARC is approximately$1,354,324.

These costs have been further calculated and redistributed based on product type.

Per Lot Total

Singles $4,063 $743,477

Twins $2,795 $89,425

Towns $2,647 $521,422

Total - $1,354,324

Common Off-Site Improvements

Utilities-

Sanitary Sewer –

Public sanitary sewer will be available to the property and is provided by the New HanoverTownship Sewer Authority (“NHTSA”). Heritage has purchased and/or paid the requisitereservation fees to the NHTSA total public sanitary sewer connection fees for the 616 lots plusthe existing lot and clubhouse at Hanover Meadows. A total of 622 EDUs have been reservedfor the AARC component, at a cost of $4,600 per EDU for a total of $2,861,200. The total costfor the 412 unit section is $Error! Not a valid link.. Buyer(s) shall reimburse Seller for the costof their share of EDUs at closing.

Per Lot Total

Singles $4,600 $841,800

Twins $4,600 $147,200

Towns $4,600 $906,200

Total - $1,895,200

Sanitary Sewer Fee

Water Extension Contribution:

Public water to this property is available and is provided by Superior Water Company. Thereare no connection fees, only construction cost contributions, included within the siteimprovements estimated herein.

Natural Gas:

Natural gas to this property is available and is provided by UGI. The cost of installing a gasline, which shall be reimbursed to Seller, is included within the Common Off-SiteImprovements and is based on an estimated provided by UGI.

Fees and Contributions:

Fees Paid at Recording –

As part of the development agreement between Heritage Building Group and New HanoverTownship, there are several fees or contributions that are to be paid by the Buyers at recording.Included in these fees are: Traffic Impact Fee, Unpaid Application Fee, TownshipCondemnation Reimbursement, and an Impact Contribution Fee. These fees are to be sharedequally between the singles, twins, towns and total $Error! Not a valid link..

Traffic Impact Fee

Traffic impact fee for the 412 lot AARC is to be paid by the Buyer at the time the FinalSubdivision and Land Development Plans are recorded.

Unpaid Application Fee

The unpaid application fee for Hanover Meadows is to be paid by the Buyer at the time412 lot AARC Final Subdivision and Land Development Plans are recorded.

Township Condemnation Reimbursement

New Hanover Township is required to condemn or acquire right-of-way required byHeritage to construct highway improvements. Heritage agreed to pay the Township$100,000 to offset the Township’s cost of acquisition/condemnation. This $100,000 is tobe paid no later than three (3) business days prior to the date on which the Townshipmust pay any compensation for any condemned lands, or no later than three (3) businessdays prior to the date of settlement if the Township acquires the land. The TownshipCondemnation Fee shall be paid to Seller at the time of Settlement.

Fees and Contributions (cont’d)

Impact Contribution Fee

Impact Contribution Fee for impacts associated with the 412 lot AARC are to be paid bythe Buyer to New Hanover Township prior to the issuance of building permits.

Per Lot Total

Singles $738 $135,054

Twins $738 $23,616

Towns $738 $145,386

Total - $304,056

Fees Paid at Re cording

Estimated Improved Lot Costs:

The 412 unit AARC can be purchased in it’s entirety by one party for a total of $11,000,000. Ifthe AARC is acquired by multiple buyers, with sections acquired based on product type, theestimated improved lot cost for the each of the product types (singles, towns, twins) is asfollows:

Singles Twins Towns

Land Price 32,995$ 22,703$ 21,500$

Common On-Site Improvements 11,089$ 7,628$ 7,225$

On-Site Improvements 54,845$ 20,355$ 30,075$

Common Off-Site Improvements 4,063$ 2,795$ 2,647$

Sewer Fees 4,600$ 4,600$ 4,600$

Fees Paid at Recording 738$ 738$ 738$

Total 108,330$ 58,819$ 66,785$

Estimate d Improved Lot Cost - Per Lot By Product Type

II. Senior Apartments/Condominiums

Immediately adjacent to the 412-unit Active Adult Retirement Community, Heritage Building Groupoffers the opportunity to acquire a fully approved Senior Apartment Complex consisting of 204 units.The Age Qualified complex offers another housing option for residents who are seeking the ActiveAdult lifestyle through a multi-unit building. The Buyer of this section will ultimately have the choiceof providing units marketed toward the Active Adult buyer that prefers to own their unit by constructingand selling the units as condominiums, or to attract residents 55-and-better that prefer to rent within aSenior Apartment complex.

The senior apartment/condominium section provides residents with separate access into-and-out of thecommunity with an entrance on Big Road (Route 73), although a shared amenities package mayavailable with the Active Adult Retirement Community. The building footprints, as designed, takeadvantage of large swaths of open space and convenient parking. Additionally, the approvals permitbuildings that are three stories in height, with a habitable third floor, and allowance for pitched roofs.

The fully approved senior apartment/condominium section can be acquired separately from the othersections for Four Million Five Hundred Thousand Dollars ($4,500,000).

204 Unit Sr. Apts/Condos


Improvement costs for Hanover Meadows have been estimated and categorized as follows:Common On-Site Improvements, On-Site Improvements, and Common Off-SiteImprovements. The follow is a description of and the estimates for each of the costs categoriesas they relate to the 412-unit Active Adult Retirement Community. The costs for the other twocomponents have also been quantified when applicable and are further detailed in therespective sections of this prospectus.


In addition to on-site improvements that directly benefit the 204-unit complex, the purchaser ofthe Senior Apartment/Condominium section will also be responsible for a pro-rata share ofcommon site improvements in conjunction with the development of the 414 unit AARC. Thetotal estimated contribution toward the common on-site improvements by theapartment/condominium builder is $ Error! Not a valid link. (Error! Not a valid link./unit). On-site improvements common to both projects include: basins, emergency access, utilityextensions, the area surrounding the clubhouse etc… Heritage Building Group may install theon-site improvements that are common to the AARC and Senior Apartments/Condominiums,and reimbursed by the buyers of the respective sections.

On-Site Improvements:

A construction estimate for on-site improvements has been prepared by Brubacher Excavating,Inc. and is included within this prospectus. The prepared bid is based on the construction of the616 unit Active Adult project in its entirety and does not contemplate phasing. These costsinclude: clearing and grubbing, erosion and sediment control, earth work, sanitary sewer, stormsewer, curbs, paving, rock, retaining walls, etc… and are further detailed within this prospectusas the Brubacher Bid. The On-Site Improvement costs have been further calculated on a pro-rata basis and redistributed among the 412 AARC unit and the 204 SeniorApartment/Condominiums.

The bid does not include the gas approach, community center, the water contribution toSuperior, or the Full Care / Life Care component. Additional on-site improvements including:Survey, Landscape, Sidewalks, Street Lights, contingency factors, permitting, macadamelevator, etc… were not included in the Brubacher Bid. It is recommended that prospectivebuyers perform their own estimate to verify the improved lot costs, taking into account costdifferentials due to construction sequence for phased construction.

Public water to this property is available and is provided by Superior Water Company. Thereare no connection fees, only construction cost contributions. The water main lines in HanoverMeadows are to be installed by Superior Water Company. Full amount of the water lineextension is typically paid by Buyer to Superior Water Company up front at the start ofconstruction. The cost of the water main line is included within the on-site improvement costs

The estimated total for the on-site improvements relative to the SeniorApartments/Condominiums is $Error! Not a valid link. (Error! Not a valid link./unit).

Common Off-Site Improvements:

Within the immediate vicinity of the 616 unit AARC (including the senior apartments) and the254 Unit CCRC components of the project, Heritage Building Group is developing a 40 lotsingle-family residential project, and a 275,000 square foot commercial project, that alsorequire certain improvements to areas outside of their respective properties. The scope of workfor these projects, particularly the improvements necessary for Route 663 and Route 73, mayoverlap between the projects. As such, Heritage Building Group may install the off-siteimprovements to be reimbursed by the Buyers of the various components.

Heritage has estimated the cost of the off-site improvements that are common to the projectand have re-distributed the costs among the various components on a pro-rata basis basedprimarily on road frontage.

Additionally, there are road improvements such as: the widening of Church Road that willbenefit the 204 unit Senior Apartments and the 412 unit AARC. In total, the estimated off-site improvement costs for the 204 unit Senior Apartments/Condominiums isapproximately $Error! Not a valid link. (Error! Not a valid link./unit).

Utilities-

Sanitary Sewer –

Public sanitary sewer will be available to the property and is provided by the New HanoverTownship Sewer Authority (“NHTSA”). Heritage has purchased and/or paid the requisitereservation fees to the NHTSA total public sanitary sewer connection fees for the 616 lots plusthe existing lot and clubhouse at Hanover Meadows. A total of 622 EDUs have been reservedfor the AARC component, at a cost of $4,600 per EDU for a total of $2,861,200. The total costfor the 204 unit section is $ Error! Not a valid link. (Error! Not a valid link./unit). Buyer(s) shallreimburse Seller for the cost of their share of EDUs at closing.

Water Extension Contribution:

Public water to this property is available and is provided by Superior Water Company. Thereare no connection fees, only construction cost contributions, included within the siteimprovements estimated herein.

Natural Gas:

Natural gas to this property is available and is provided by UGI. The cost of installing a gasline, which shall be reimbursed to Seller, is included within the Common Off-SiteImprovements and is based on an estimated provided by UGI.


Fees Paid at Recording –

In accordance with the settlement agreement with New Hanover Township through whichFinal Approval for the project was obtained, certain fees and contributions are required ofbuilder to be paid at final plan recording. The buyer of the 204 unit SeniorApartment/Condominium Component is responsible for a pro-rata share of the fees andcontributions totaling $Error! Not a valid link. (Error! Not a valid link.unit).

Traffic Impact Fee

Traffic impact fees for the 204 unit Senior Apartment/Condominiums are to be paid bythe Buyer at the time the Final Subdivision and Land Development Plans are recorded.

Unpaid Application Fee

The unpaid application fee for Hanover Meadows is to be paid by the Buyer at the timethe 204 unit Senior Apartment/Condominiums Final Subdivision and Land DevelopmentPlans are recorded.

Township Condemnation Reimbursement

New Hanover Township is required to condemn or acquire right-of-way required byHeritage to construct highway improvements. Heritage agreed to pay the Township$100,000 to offset the Township's cost of acquisition/condemnation. This $100,000 is tobe paid no later than three (3) business days prior to the date on which the Townshipmust pay any compensation for any condemned lands, or no later than three (3) businessdays prior to the date of settlement if the Township acquires the land. The TownshipCondemnation Fee shall be paid to Seller at the time of Settlement.

Impact Contribution Fee

Impact Contribution Fee for impacts associated with the 204 unit SeniorApartment/Condominiums are to be paid by the Buyer to New Hanover Township priorto the issuance of building permits

Estimated Improved Lot Costs:

The 204 unit Senior Apartments/Condominiums section can be purchased in it’s entirety fortotal of $4,500,000. The estimated improved lot cost for this section, based on the costs definedherein is as follows:

204 Per Unit Total

Land Price 22,059$ 4,500,000$

Common On-Site Improvements 7,393$ 1,508,147$

On-Site Improvements 22,142$ 4,516,905$

Common Off-Site Improvements 2,708$ 552,507$

Sewer Fees 4,600$ 938,400$

Fees Paid at Recording 738$ 150,552$

Total 59,640$ 12,166,511$

Estimated Improved Lot Cost - Senior Apartments/Condominiums

III. Continuing Care Retirement Community

Hanover Meadows is a truly unique Age Qualified housing opportunity, providingunparalleled flexibility in design and development, enabling builders and operators the abilityto construct utilizing several methods or models.

The smallest portion of the Master Planned Community, consisting of approximately 16 acres,is a self-contained Continuing Care Retirement Campus (“CCRC”) with private access from N.Charlotte St. (Route 663) and Miles Rd. The two uses are buffered substantially by the naturalwoods and wetlands on the property, ensuring that if desired, the residents of one communitywill not be adversely impacted by the other. As a result, prospective buyers can analyze theproperty from the perspective of building Independent Living and Assisted Living (Full Care)on one campus, adjacent to but separate from, an Active Adult Retirement Community.

Heritage Building Group has obtained Conditional Use Approval to permit the design anddevelopment of a Continuing Care Retirement Campus consisting of Independent Living andAssisted Living Facilities. At the time of Approval, Heritage made assumptions regardingacreage allocation and unit densities, based on the opportunities and constraints of the site andthe layout of similar facilities. Because only the “use” has been approved for the CCRCcomponent, and only conceptual plans have been submitted, the ultimate builder of this project

254-Unit CCRC

is not constrained by those assumptions and has the ability to re-design the plans, building tosuit the specific demands of the intended residents, subject to the underlying zoning (asmodified by the Court approved Settlement Agreement), the approvals of New HanoverTownship, and all requisite permits from outside agencies.

As part of negotiations with the Township, Heritage obtained the available use and establishedthe site capacity calculations, while working to preserve maximum design flexibility for theCCRC component. The CCRC consists of two components: Life Care (Independent Living)and Full Care (Skilled Nursing, Assisted Living).

Life Care (Independent Living):The Life Care component is a residential use designed for individuals of retirement age withcertain support requirements, but not necessarily in need of skilled nursing.

The layout of the Life Care Facility, given the current acreage allocation, cannot exceed 190Units. However, the number of beds/bedrooms is limited only by the amount of availableparking and impervious surface that must be provided. In essence, any combination of one andtwo bedroom units, up to 190 units, can be achieved as long as the parking and imperviousrequirements are met. Ultimately, the developer of this property will have maximum flexibilityin designing the units to accommodate the preferred ratio of one and two bedroom units,provided that it is consistent with the bulk area standards for parking, open space andmaximum impervious coverage. The maximum building height has been modified from theunderlying zoning to permit buildings that are 40’ in height and 3 living stories. This provisionwas specifically included to enable builders greater flexibility in their architectural choices andpermit façades and elevations that incorporate pitched roofs.

Full Care (Assisted Living/Skilled Nursing):

The Full Care facility is designed and operated exclusively for individuals of retirement agethat require skilled full-time care. The maximum number of beds permitted, given the currentacreage allocation, in the Full Care component is 128 beds within 64 units. Architecturally, themaximum building height is also 40ft; in order to accommodate 3 living stories. The ultimatedesign and layout of the Full Care facility is subject to the bulk area standards for parking,open space and maximum impervious coverage.

The Continuing Care Retirement Community is being offered for sale, with conditionaluse approval, for Four Million Five Hundred Thousand Dollars ($4,500,000).

Product Type Units Price Per Lot Total Price

Independent Care 190 20,000$ 3,800,000$

Assisted Living 64 11,000$ 700,000$

Total 254 - 4,500,000$

Hanover Meadows CCRC - Approximate Price Per Unit


Improvement costs for Hanover Meadows have been estimated and categorized as follows:Common On-Site Improvements, On-Site Improvements, and Common Off-SiteImprovements. The follow is a description and the estimates for each of the costs categories asthey relate to the 254-unit Continuing Care Retirement Community. The costs for the other twocomponents have also been quantified when applicable and are further detailed in therespective sections of this prospectus.


Public water to this property is available and is provided by Superior Water Company. Thereare no connection fees, only construction cost contributions. The water main lines in HanoverMeadows are to be installed by Superior Water Company. Full amount of the water lineextension is typically paid by Buyer to Superior Water Company up front at the start ofconstruction.

A pro-rated share of these items, responsible by the CCRC builder, is included in the commonon-site improvements estimate. The total estimated cost of the common on-siteimprovements for the CCRC component is $Error! Not a valid link..

On-Site Improvements

A construction estimate for on-site improvements has not yet been prepared for the conceptualplan. It is understood that the Buyer will ultimately reconfigure the building layout using thebuilding footprints and specifications that are preferred. As a result, the scope and cost of theon-site improvements will ultimately be determined by the Buyer.

Off-Site Improvements:

Natural gas to this property is available and is provided by UGI. Buyer shall reimburse Sellerfor the installation of a gas line to the site based on an estimate provided by UGI.

The CCRC is also responsible for the sewer line installation and improvements to Miles Rd.

The estimated share of the common off-site improvements for the CCRC component is$Error! Not a valid link..

Sanitary Sewer –

Public sanitary sewer will be available to the property and is provided by the New HanoverTownship Sewer Authority (“NHTSA”). Heritage has purchased and/or paid the requisitereservation fees to the NHTSA total public sanitary sewer connection fees for the 254 unitCCRC. The total cost of public sewer for the Continuing Care Retirement Community is$Error! Not a valid link.. Buyer agrees to reimburse Heritage at closing for the payments made todate ($710,028), plus will make the final two payments of $284,000 and $453,264 to NHTSAon July 16, 2009 and December 31, 2009 or at plan recording, respectively.


There are no fees or contributions due at this time; however it is understood that Buyer may besubject to Municipal fees or contributions negotiated with the Township as part of obtainingPreliminary or Final Approval.

Estimated Partially Improved Lot Cost

The 254 unit CCRC is being sold with Conditional Use Approval, however reimbursements forcommon on-site and off-site improvements will be required of the buyer. The estimated cost ofthese improvements, plus the cost of the land, and the public sanitary sewer are as follows:

254 Per Unit Total

Land Price 17,717$ 4,500,000$

Common On-Site Improvements 5,954$ 1,512,219$

Common Off-Site Improvements 2,181$ 553,999$

Sewer Fees 5,698$ 1,447,292$

Total 31,549$ 8,013,510$

Estimated Partially Improved Lot Cost - Continuing Care Retirement Community

Market Analysis

Market AnalysisAge Qualified Demographics

In 1900, less than 5% of the national population was comprised of people over the age of 65.From 1990 to 2000, the U.S. population aged 60 years and greater increased by about 3.5million. However, during the next ten years, the total increase in persons aged 60 years andover will exceed 10 million, almost three times that of the past decade. Looking further ahead,the increases in the mature population will be even more dramatic. Now numbering over 35million, this cohort accounts for over 12% of the nation’s population and by the year 2030 thispopulation will double to more than 70 million or 20% of the US Population.

The National Association of Home Builders (NAHB) recently declared that the 50+demographic is the “fastest-growing segment of the current housing market.” Representativesfurther stated that the 55-to-64 national age group is expected to grow by a “whopping 75%between now and 2020, while the 65+ age group will increase by 54%.” In fact, between 1990and 2000, the 55-to-59 age group increased in every single state of the nation, proving that theUnited States is an aging nation in need of adequate housing for this demographic. Insummary, the Active Adult housing market is ready to explode, assuring the success of futurehomebuilders who enter this burgeoning marketplace.

Amazingly, Pennsylvania provides an environment with exponentially greater potential thaneven the glowing national demand creates. Below is a Thematic Map illustrating the medianage of all 50 states, clearly marking Pennsylvania as one of four states with the oldest medianage.

This elevated median age provides an initial indicator of future success in the age-qualifiedmarket. Below is a snapshot of several other national ranking statistics for Pennsylvania, oneof the largest and most prosperous markets for senior housing available to home builders.

Pennsylvania

In 1990, the average age of an Active Adult homebuyer was 67 but by 2000, that average agedropped to 61 year old. This is encouraging news for homebuilders, because not only isAmerica aging, but the average age of those purchasing Active Adult and/or age qualifiedhousing is decreasing, exponentially increasing the current demand for such housing.Additionally, from 1969 – 1996, the median household income for married couples 65+increased by 57%; proof that not only are American’s working longer but they have the meansby which to afford housing suitable to their age-specific needs.

Pennsylvania Age Qualified Statistics (TABLE)

Qualifier Rank National Rank

Population 12,281,054 #6

Median Age 38 #4

Percentage of Population 60+ 19.8% #3

Percentage of Population 65+ 15.6% #2

Number of People between 55-74 2,100,897 #5

55-74 bracket as share of the State's total Population 17.1% #4

By the year 2000, Pennsylvania accounted for nearly 5% of the national home owners ages 55and above. By 2020, a shocking 25% of Pennsylvania’s population, 3 million residents, isexpected to fall into the 60+ age category, a sizeable portion of the population that will be inthe market for the type of quality age qualified housing Hanover Meadows will provide.

Specifically, the Pennsylvania Department of Aging recently stated that “during the comingdecade, the highest increases in the age 60-to-74 year old population are projected inthe…southeast sections of the Commonwealth.” Currently, 19% of Montgomery County’spopulation is comprised of residents 60 and older. By the year 2010, the population ages 60+is expected to increase by 11%, thus constituting 22% of the county’s total population.Montgomery County therefore finds itself firmly embedded in an area that will require largescale development of new Active Adult housing to meet the aging population’s demand.

Growth within Montgomery County has been particularly felt in New Hanover Township.Between 1990 and 2000, Montgomery County gained the distinct recognition asPennsylvania’s 5th fastest growing urban county, with an impressive 14.2% increase expectedby 2025. This fantastic growth was based, in large part, on an epidemic of rapidly increasingpopulation densities, costs of living, and crime rates indicative of neighboring Philadelphia andDelaware Counties. These characteristics forced many people and jobs into neighboring Bucks,Chester, and Montgomery Counties. The Thematic Map below, showing the population of eachmunicipality within Montgomery County (2000), provides stark visual evidence of this steadyprogression out of Philadelphia County, north and west into Montgomery County. NewHanover Township, located in western

Montgomery County along the bustling Route 422 corridor, finds itself within the direct pathof this expansion.

From 1990 – 2004, New Hanover Township experienced a robust 43% increase in population.Though impressive, it is future population projections that provide stronger evidence ofHanover Meadows’s imminent success. By the year 2010, New Hanover Township’spopulation is expected to increase by 25%, the 5th largest percent increase withinMontgomery County. Even more astounding, New Hanover is expected to undergo a 98%increase in population by 2025, marking the single largest percent increase of any municipalityin Montgomery County.

Furthermore, in New Hanover Township more than one-fifth of the total population is abovethe age of 55, and thus in the market for quality age restricted/age qualified housing. HanoverMeadows is not only located in one of the oldest and fastest aging states of the nation, but issituated within a municipality located in one of the most rapidly aging geographic areas in theentire state where 20% of current residents qualify for age restricted housing.

Housing Market

The flourishing housing market of New Hanover Township and Northwestern MontgomeryCounty is driven by rapid population growth and a limited supply of new housing along theRoute 422 Corridor.

Thus, the major growth areas for new housing are currently located in NorthwesternMontgomery County, Northeastern Chester County, and Southeastern Berks County. Due toconvenient access to major roads, these areas have become bedroom communities to the majoremployment centers located along Route 422 and Route 100.

This trend has led to the proposal of many new single-family communities within NewHanover and nearby townships as homebuilders continue to build in areas that proximate thepath of growth along Route 422. Yet, despite the amazing growth and the proposal of

PhiladelphiaCounty

MontgomeryCounty

New HanoverTownship

approximately 5,000 non age-qualified homes, Hanover Meadows is the only Active Adultdevelopment opportunity available in the area!

The current and future population growth statistics within Montgomery County and NewHanover Township prove that a robust market for new housing clearly exists alongtransportation corridors in northwestern Montgomery County. However, given the limitedsupply and expected demand it is the age-qualified market that presents the greatest futuresuccess for new home builders

Income and Employment Trends

The notion that Age-Qualified communities are occupied solely by retirees is no longeraccurate. Communities that target residents 55 years and older are often very desirable toresidents who intend to continue working, whether full-time in their chosen careers or part-time at local stores and offices. Often, the choice to continue working stems from a desire forsocial interaction and less for economic need.

The tremendous population growth experienced by Montgomery County could not have beensustained without an equally robust employment infrastructure providing high quality jobs tothe area’s residents. Additionally, it is not merely the socio-economic status of theimmediately surrounding area that entices new home buyers, but also that of destinations thatcan be reached via manageable commutes along the areas roadways. Herein lies the ultimatesuccess story of both Montgomery County and New Hanover Township.

Future residents of Hanover Meadows will find an abundant network of major roadwaysquickly and easily connecting Montgomery County to all parts of the region. Thesethoroughfares, including the Pennsylvania Turnpike, Routes 100, 73, 309, and 202, and theflourishing Route 422 Corridor, have brought with them a plethora of quality employers,including some of the nations largest financial giants and pharmaceutical companies. Thearrivals of Merck & Company, Johnson & Johnson, GlaxoSmithKline, Quest Diagnostics, andWyeth Pharmaceuticals have introduced an astounding 25,000 new high paying jobs to thearea. Residents of Hanover Meadows will also be able to utilize these same roadways toaccess employment centers in nearby Reading, King of Prussia, the Lehigh Valley,Philadelphia, West Chester, Norristown, and Lancaster. Below is a comprehensive listing ofMontgomery and nearby Chester County’s largest employers. The ability to find qualityemployment both locally or within commuting distance has allowed Montgomery Countyresidents to enjoy robust levels of income. For the fiscal year ending 2005, MontgomeryCounty’s median household income of $68,829 was a full 64.7% higher than the state’saverage income of $44,537.

Equally vigorous were the economic indicators for New Hanover Township. Between 1990and 2000, employment within New Hanover Township increased by 22%, a figure expected toincrease an additional 26% by 2020. These employment figures translated into above averagelevels of income for residents of booming New Hanover Township. At $67,097, this robustmunicipality’s median household income was 10% higher than the Montgomery Countyaverage, 67% above the state’s median, and 60% above the national median household income.Additionally, the median family income of $70,789 again topped median income levels forboth the state and the nation. More important to future homebuilders is the fact that thisprosperity and growth in job creation is not occurring in isolation. The chart below showsprojected percent increases in new jobs for New Hanover Township and its neighboringmunicipalities by the year 2015.

Percent Increase in Job Creation by 2015Municipality % Increase in Job Creation

New Hanover Township 19%

Upper Pottsgrove Township 40%

Limerick Township 39%

Upper Hanover Township 37%

Lower Pottsgrove Township 19%

Douglass Township 19%

Upper Frederick Township 8%

Such ample employment opportunities and increased levels of income inherently translatedinto residents’ ability to afford a more expensive, higher quality level of housing.

Employer Industry Employees Employer Industry Employees

Merck Pharmaceuticals 10,000 Vanguard Group Financial 8,250

Prudential Financial Services 6,565 Medtronic, Inc. Health Care 4,300

Jefferson Health System Health Care 4,671 QVC Network, Inc. Retail 2,475

Abington Memorial Hospital Health Care 4,586 Genesis Rehabilitation Services Health Care 2,100

Aetna/US Healthcare Insurance 3,524 Siemens Medical Solutions Health Care 2,000

Lockheed Martin Technology 3,000 Chester County Hospital Health Care 1,700

Genuardi Supermarkets Retail 2,696 Lasko Metal Products Manufacturing 1,500

Quest Diagnostics Health Care 2,321 Unisys Corporation Technology 1,500

Holy Redeemer Hospital Health Care 2,244 VA Medical Center Health Care 1,400

McNeil Pharmaceuticals 2,000 Brandywine Hospital Health Care 1,000

Source: Montgomery County, Harris Infosource

Largest Employers: Montgomery and Chester Counties

Montgomery Chester

These employment figures prove important when evaluating the viability of a 55+ age qualifiedhousing community because a recent survey of baby boomers revealed that over 70% expect tocontinue to work, at least part time, after the typical age of retirement. Since 1950, the share ofUnited States’ population ages 65+ increased from 8% to 12% of the population. Furthermore,the Committee for Economic Development “strongly believes that additional years ofwork…will be increasingly desirable for a growing number of older Americans and for oursociety,” further stating that “…it is doubtful that ever-longer retirement will continue to bebeneficial and affordable for individuals in the nation.”

Competitor Analysis

The incredible increase in population originating from the influx of elite employers into thearea has created an obvious need for new development to house this growing population.Between 2000 and 2005, Montgomery County experienced a 16.3% increase in new housing,adding 17,538 units to the marketplace. In fact, of all the thriving southeastern counties thatsurround Montgomery County, only Chester County experienced a higher percentage increasein new housing units (17.7%).

More specifically, recent population trends have created an undeniable need for new housingunits in Western Montgomery County’s municipalities. In fact, some of the largest percentincreases in new housing units with all of Montgomery County occurred in these westernmunicipalities. Below is a comparison of this remarkable growth.

2000-2005 New Housing Units by MunicipalityMunicipality 2000-2005 Absolute Change

Upper Providence 1,408

Limerick 1,340

Skippack 1,104

New Hanover Township 516Douglass Township 465

Lower Pottsgrove 428

Upper Pottsgrove 365

Upper Frederick 217

Trappe 97

Lower Frederick 64

The growth in new housing within New Hanover Township played an important role inMontgomery County’s overall expansion. Between 1990 and 2000, New Hanover Townshipwitnessed a 20% increase in new housing units, reaching a level of 3,131 total units by 2005.However, of even greater significance to future homebuilders of Hanover Meadows may bethe fact that between 1990 and 2005, Hanover Meadows was the only plan sent to theMontgomery County Planning Commission for the development of age qualified, age

restricted, or Active Adult communities within New Hanover Township. In essence, although20% of residents of New Hanover Township are 55 or older and thus prime candidates forActive Adult communities, the municipality in which they reside is void of any such housing.These residents are forced to live in developments that do not properly cater to their specificneeds, or move to a surrounding municipality or county that offers such housing. NewHanover Township represents an area prime for the introduction of an entire array of agequalified housing selections, meeting not only the demand created by this aging demographic,but also their individual preference in housing type and affordability.

Competitor Analysis

Hanover Meadows offers the unique opportunity to develop an Active Adult RetirementCommunity that combines different product types. Communities that offer a mix of housingtypes can target specific market segments and appeal to wider range of Active Adulthomebuyers, increasing sales pace and price points. Heritage Creek, a sold-out Active AdultCommunity by Mignatti Company, is a prime example of this philosophy. Heritage Creek soldout by June 2003 largely by incorporating both condominiums and single-family detachedhouses into the vast 402 unit Golf Club Community. Mignatti Company was able to reach salesrates exceeding ten per month, with settlements for condominiums and single-family detachedhomes reaching as high as $400,000.

Alternatively, the community can be acquired by multiple builders and enables them to focustheir marketing efforts on one specific product type. Fortunately for home builders, agerestricted single-family detached and attached homes continue to be in demand in MontgomeryCounty.

Limerick Township

The Villas at Linfield National (McGrath Homes) - This exclusive Active Adult Communityconsists of 200 quadraplex townhomes that range in size from 1,800 to 2,350 square feet. Salesat The Villas at Linfield National began in July 2004. Base prices range from $269,900 to$279,990. Sales in this community began July 20004 and has maintained a sales pace of 4.2sales per month.

Model Square Fe et Minimum Price Price/ Sq. Ft.

Mulberry 1,800 $269,900 $150

Rosewell 2,100 $274,990 $131

Thornhill 2,250 $279,990 $124

Willow 2,350 $279,990 $119

Average: 2,125 $276,218 $131

Upper Hanover Township

Northgate (TH Properties) – A small section of the very popular master planned community,Northgate, TH Properties offers 60 single-family attached homes for age qualified buyers. Thissection of the community opened in March 2008 and despite the lack of clubhouse or modelhas had two sales. Active Adult homes in Northgate start from $199,990.

Model Square Fe et Minimum Price Price/ Sq. Ft.

Arlee 1,672 $199,990 $120

Bateman 2,100 $204,990 $98

Cartier 1,815 $214,990 $118

Average: 1,862 $206,657 $112

Skippack Township

The Meadows at Skippack (Erb Mascio) – Only two of the original 135 active adult homesremain at The Meadows at Skippack. Opening in June 2003, this community achieved a salespace of 2.3 homes per month over the life of the project. The Meadows features amenities suchas a walking/jogging trail along beautifully landscaped, preserved open space. With itsfantastic clubhouse, this community is surely the natural choice for your active lifestyle.

Base prices in this community range from $272,900 to $292,900.

Model Square Fe et Minimum Price Price/Sq. Ft.

Ardsley 2,318 $272,900 $118

Brighton 2,356 $282,900 $120

Canterbury 3,432 $292,900 $85

Average: 2,702 $282,900 $108

A sample of the settlements in 2007 for this community are as follows:

Settlement Date Bldg. Sq. Ft.

11/15/2007 2,664

7/31/2007 2,207

9/10/2007 2,337

6/26/2007 2,024

Average 2,308

Price Price /.Sq. Ft.

$403,000 $151

$440,590 $193

$420,558 $191

$491,000 $210

$447,802 $221

Meadow Glen (Erb Mascio) – Continuing the success that Erb Mascio experienced at TheMeadows at Skippack, this builder opened a second community within the same township inMarch 2007. Currently selling the first of two phases, Meadow Glen features 70 single-familydetached lots of which 29 have been sold. To date, the community has experienced a sales paceof 2.1 homes per month.

Residents will enjoy a 7,000 square foot clubhouse (not yet built), picturesque trails and morethan 40 acres of open space.

Model Square Feet Minimum Price Price/Sq. Ft.

Ashland 1,680 $329,900 $196

Elmwood 1,800 $375,975 $209

Bayberry 2,030 $379,900 $187

Deerfield 1,960 $379,900 $194

Fairview 2,050 $389,900 $190

Cedarbrooke 2,100 $399,900 $190

Average: 1,937 $375,913 $194

Upper Providence Township

Regency at Providence (Toll Brothers, Inc.) - This 227 single-family detached Active AdultCommunity features single-family detached homes that range from 1,720 to 2,590 square feetwith a typical lot size of 5,445 square feet. Sales at the Regency at Providence began inSeptember 2004 with a sales pace of 4.5 sales per month. Base prices range from $373,975 to$413,975.

Model Square Feet Minimum Price Price/Sq. Ft.

Stamford 1,720 $373,975 $217

Norwich 1,800 $375,975 $209

Lehigh 1,850 $378,975 $205

Narberth 2,326 $398,975 $172

Walden 2,358 $403,975 $171

Stockton 2,590 $410,975 $159

Linwood 2,367 $413,975 $175

Average: 2,144 $393,832 $187

Upper Gwynned Township

Reserve at Gwynned (Pulte) – In addition to the 145 carriage homes in this Active AdultCommunity, the community also features 175 condominiums and 91 manor homes for a totalof 411 homes. The carriage homes range from 2,300 to 3,000 square feet, the manor homesrange in size from 2,900 to 3,000 square feet and the condominiums range from 1,600 to 1,900square feet. Reserve at Gwynned offers residents a range of amenities including: a 16,000square foot clubhouse, a fitness center, an indoor/outdoor pool, and rooms for billiards, cardsand crafts.

Sales in this community began in July 2005. There have been 46 town homes sold, 45 manorhomes sold and all of the condominiums are sold out for a sales pace exceeding 10 homes permonth. Base prices for the townhouses range from $429,990 to $503,990, with base prices forthe manor homes ranging from $551,990 to $622,990.

Carriage Homes Square Feet M inimum Price Price/Sq. Ft.

Woodford 2,382 $429,990 $181

Fulton 2,788 $462,990 $166

Hillcrest 2,937 $503,990 $172

Average: 2,702 $465,657 $173

Manor Homes Square Feet M inimum Price Price/Sq. Ft.

Harrington 2,904 $551,990 $190

Wharton 2,904 $557,990 $192Richland 3,184 $622,990 $196

Average: 2,997 $577,657 $193

Area AmenitiesTraditionally, the perception of retirement communities has been that upon reaching retirementage, America’s elderly would move to warm, sunny locations such as Florida and Arizona toenjoy the relaxing lifestyle found in large retirement communities. While this patterncontinues, it is quickly becoming obsolete in today’s market. At present, Age-QualifiedCommunities are more focused on creating desirable lifestyles.

Proximity to Family - An ever increasing percentage of America’s retirees choose to staycloser to their home towns, and more importantly, closer to their families, regardless of theweather. More “four season” retirement communities are being developed in the temperateclimates of Pennsylvania, New Jersey, and Maryland in favor of those commonly found in theSunbelt states.

In the past five years, more than 6,000 new homes have been built or proposed within NewHanover Township and the surrounding area. New Hanover Township has proven to be a veryattractive location for the move-up buyers with larger families who often care for or prefer toliving close to their parents and grandparents.

Recreation - The idea that retirees are passively spending their days is quickly beingdebunked. Age-Qualified Communities today are designed to meet the needs of a retiree’sactive lifestyle, with a greater emphasis on recreation including: golf, tennis, swimming,jogging and bike riding. Active lifestyles often include visiting local museums, libraries andfine dining.

In addition to having many outdoor amenities within the community, Hanover Meadows islocated in close proximity to a wide variety of outdoor activities. In most Active AdultRetirement Communities, approximately 30 percent of the residents enjoy playing golf andconsider it a popular amenity. Hanover Meadows is within a short distance of ten different golfcourses including the Gilbertsville Golf Course and Hickory Valley Golf Course; both ofwhich are adjacent to the community.

New Hanover Township has a total of six public parks. Swamp Creek Park, just minutes fromHanover Meadows, consists of 27 acres and includes a paved one-mile long walking/joggingtrail. New Hanover Community Park, also within minutes of Hanover Meadows, is 12 acresand features a paved half-mile long walking/jogging trail, basketball court, softball field, andtot lot.

Green Lane Park, located just outside of Green Lane Borough, is within a ten-minute drive ofHanover Meadows. This park consists of 3,400 acres and three bodies of water that total 870acres: Green Lane Reservoir, Deep Creek Lake, and Knight Lake. Activities in the summer atGreen Lane Park include boating, hiking, and biking. Additionally there are three tennis courtsand two playgrounds. Winter activities include cross-county skiing, ice skating, and sledding.

Upper Perkiomen Valley Park, which consists of 567 acres, adjoins Green Lane Park andoffers similar activities.Other large parks in the area include French Creek State Park,Evansburg State Park, and the Valley Forge National Historical Park.

Shopping - Typically, Active Adult residents prefer to live with access to local orneighborhood shopping. This includes the local grocery store as well as larger retail venuesincluding malls and outlets. In addition to providing a source to purchase daily necessities,local shopping also presents another outlet for socialization and recreation.

Residents of Hanover Meadows will have convenient access to shopping opportunities in theregion. All essential needs can be served by an approved 275,000 square foot neighborhoodshopping center, New Hanover Crossing, which is being developed on Charlotte Road, iswithin walking distance to Hanover Meadows.

Regionally, residents are within a short drive of several larger retail centers. The King ofPrussia Mall, which is one of the nation’s largest malls with nearly three million square feet ofretail space, is located within a 40-minute drive of Hanover Meadows. Additionally, the brandnew Philadelphia Outlet Shopping Center in Limerick Township is anticipated to open inDecember 2007, providing residents of Hanover Meadows a great shopping destination withina twenty minute drive.

The Coventry Mall is within fifteen minutes of the community. Major tenants includeBoscov’s, Kohl’s, Sears, and Dick’s Sporting Goods. Coventry Mall is currently undergoing amulti-million dollar renovation. In addition, the unique shopping experience offered bySkippack Village is within a 25-minute drive. Here, shoppers will find quaint stores andrestaurants located in renovated 18th and 19th century buildings.

Educational Institutions - Continuing education among Active Adults serves as a greatopportunity to learn, but more importantly provides a unique setting to socialize. Localcolleges and universities often encourage retirees to take classes because of the uniqueperspective that is brought through life experiences.

The Greater Philadelphia region is home to one of the largest concentrations of highereducation institutions in the country, with more than 80 colleges and universities and 56academic medical centers. The West Campus of Montgomery County Community College islocated within minutes of Hanover Meadows in Pottstown and offers continuing educationclasses as well as full programs in areas such as business and computer science. UrsinusCollege, located in Collegeville, is also within a short drive of Hanover Meadows.

Transportation - Active Adults today are characterized by two prominent components:economic independence and a thirst for life. There is very little grass growing under today’sretirees. Living near train stations, major highways and within close distance to airportsprovides the freedom to travel to visit friends, family and exotic destinations.

Hanover Meadows is located along Route 663, a linking road between Pottstown andQuakertown. Additionally, Route 422, Route 100, Route 73, Route 29, and The NortheastExtension of The Pennsylvania Turnpike are all easily accessible.

Residents of Hanover Meadows will be connected with the greater Pottstown area andnorthern Chester County via the Pottstown Urban Transit System.

Passenger rail service is provided by Southeastern Pennsylvania Transportation Authority(SEPTA) and can easily be accessed in nearby Pottstown borough. This enables non-driverswith convenient access to an unlimited number of destinations including Philadelphia, NewYork City, Washington D.C., Atlantic City and the New Jersey Shore.

Hanover Meadows is within a short distance of the Philadelphia International Airport and theLehigh Valley International Airport for all of their traveling needs.

Healthcare - There are many excellent health care centers that are easily accessible fromHanover Meadows, covering the full spectrum of medical services from routine check-ups tospecialized fields.

Pottstown Memorial Medical Center – 299 bed facility serving nearly 250,000 residents ofBerks, Chester, and Montgomery Counties is minutes from Hanover Meadows. The hospitalemploys over 250 physicians practicing more than 30 medical specialties with affiliations tothe nationally renowned Fox Chase Cancer Center. Pottstown Memorial Medical Center isalso part of the Pottstown Regional Healthcare Network which includes Pottstown Scanningand Treatment Center and three Family Care Centers.

Phoenixville Hospital – 106 bed facility serving over 8,000 inpatients and 20,000 emergencypatients annually. Phoenixville Hospital is a member of the University of Pennsylvania HealthSystem, a system recently rated one of the best hospital systems in the nation by US News andWorld Report. Phoenixville will spend $75 million to $80 million in the next two years to adda four-story, 100,000-square-foot tower with all private rooms and a helipad; a three-story,45,000-square-foot medical office building; and a 553-space, three-story parking garage. Phasetwo of the project, will include expansion and renovation of operating and labor/deliveryrooms and cosmetic refurbishment of older areas of the hospital.

Reading Area Hospital and Medical Center – Berks County’s largest employer, providescomprehensive acute care, post-acute rehabilitation, behavioral, and occupational health services tothe people of Berks and adjoining counties. The 566 bed West Reading Facility consists of a 20building complex located on a 36 acre suburban campus with a medical staff that exceeds 550physicians in 51 clinical specialties. The Reading Hospital admits 31,000 patients annually,performing 29,000 surgeries while also handling 2.7 million outpatient services a year.

Appendix

hanover meadows offering memorandum 2

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