By merging a property or a portfolio of properties into Tower in exchange for partnership units, an owner can achieve the following benefits:

1. Cash Distributions: an investor can increase the stability and amount of his monthly cash distributions. Tower’s cash distributions to its investors have grown every year since 1993 when Tower consolidated its properties.
   
   
2. Defer Recognition of Gain: as the transaction occurs through an exchange of partnership units, gains taxes are deferred.
   
   
3. Alignment of Interests of Management with Partners: in contrast with the common practice of ownership relying on a third party to provide management for a fee, Tower has eliminated this inherent conflict by merging the ownership of the properties and the management company into one entity. Furthermore, senior members of the management team are all partners in Tower.
   
   
4. Continued Benefits of Ownership of Real Estate: amongst many others, owning a portfolio of multifamily apartment units offers the following attractive benefits 1) a stable income stream 2) a hedge against inflation and 3) tax advantaged distributions.
   
   
5. Maintain a Leveraged Equity Position: Tower's goal is to maximize the value of partner's equity by utilizing prudent, cost effective levels of debt and thereby continue the maximization of the growth of partner's distributions.
   
   
6. Gain the Benefits of Owning a Diversified Portfolio: Tower currently owns a portfolio of multifamily properties throughout Northern New Jersey and New York State and anticipates acquiring and developing additional properties as opportunities arise.
   
   
7. Secure Access to Lower Cost Financing: Tower’s relationships with capital sources and the economies of scale of owning a diversified portfolio, enable a seller to enjoy lower interest costs for a newly acquired asset.
   
   
8. Eliminate Personal Management Responsibility: Tower manages all of its owned assets through its operating company thereby relieving the seller of the substantial time and capital commitments of everyday ownership.
   
   
9. Improve Estate Planning: ownership of partnership units in Tower increases flexibility in structuring estate planning. Partnership units can be exchanged through our active mechanism for facilitating the resale of partnership units. This flexibility is particularly helpful with estate planning due to the stepping up in tax basis that is achieved upon death and the resulting transfer to an heir.
   
   
10. Partnership Management: If the seller is a partnership, once the asset is exchanged for partnership units, individual partners can make their own decisions on their shares independent of their original partners.
    
    
11. Improved Liquidity: Partners who are interested in selling some or all of their partnership units can market them to other Tower partners through our secondary marketing mechanism.
    
    
12. Valuation: The value of Tower, an operating company of a portfolio of owned assets, will traditionally trade at a higher multiple (lower cap rate on NOI) than a single asset (or even a group of fee- managed assets).

By becoming a partner in Tower, an owner would benefit from the ownership of a diversified portfolio of multifamily properties in two major markets and participate in the anticipated growth in distributions. The projected increase in distributions are expected to be achieved through the fulfillment of Tower’s operating objectives which include:

1. Property Operations: Tower has increased Net Operating Income an average of 4.8% per year over the past five years. Tower continues to push income levels while keeping a close watch on the expense side.
   
   
2. Lower Cost of Capital: Tower can lower interest costs through its access to investment-grade rated debt. Tower’s 65% leverage ratio provides a cushion to withstand interest rate market shocks and the flexibility to insure a competitive, optimal financial structure.
   
   
3. Lower Operating Cost: Tower can manage additional assets at a marginal cost significantly below ordinary management fees and pass the profit through to its partners. Tower's prudent re-investment in the properties insures that the properties will continue to remain competitive in their markets and that revenue growth can be sustained.