BlackRock Realty Advisors Inc

Item 5. Fees and Compensation

Other Fee-Related Matters

BlackRock Realty’s fees are payable in advance or in arrears, depending on the BlackRock Realty Client.
However, no fee will be payable six or more months in advance of the services rendered. BlackRock Realty’s
IMAs with BlackRock Real Estate Separate Accounts generally do not have termination dates. Rather, the
IMAs typically are terminated by BlackRock Realty or the BlackRock Realty Client with advance notice, as set
forth in the relevant IMA. In the event of the termination of a relationship, unearned fees, if any, paid in
advance will be refunded to the BlackRock Realty Client. To the extent fees have been earned but not yet
billed, such fees will be pro-rated and paid by the client upon termination. In certain cases (e.g., separate
accounts with performance-based fees), fees continue to be paid after termination of the relationship in
accordance with the relevant agreement.

While BlackRock Realty charges transaction related fees as discussed in this Item, it does not receive
commissions or markups for the sale of securities or other investments.

Fees Paid to Third Parties

With respect to certain investment management clients of BlackRock (“BlackRock Clients”) a BlackRock
Investment Adviser, its affiliates or any BlackRock director, manager, member, officer, or employee
(“BlackRock Employees”) may at times receive commitment fees, origination fees, structuring fees,
administrative agency fees, break-up fees, financing fees, directors’ fees, consulting fees, transaction fees,
advisory fees, closing fees and other similar fees from a portfolio investment of or counterparty to such
BlackRock Clients, respectively, as well as placement or other similar fees payable to a broker-dealer (“Third-
Party Fees”). The management fee received by a BlackRock Investment Adviser from a BlackRock Client or
one of its affiliates may be reduced by the amount of Third-Party Fees received by such BlackRock
Investment Adviser, its affiliates or any BlackRock Employees. Subject to any applicable law or regulation, the
extent to which a BlackRock Investment Adviser, its affiliate or any BlackRock Employee may retain such
Third-Party Fees, if at all, and further details of any such Third-Party Fees, are set forth in such BlackRock
Client’s OM, IMA and/or other governing documents, respectively.

Various conflicts of interest may exist when Third-Party Fees can be retained by a BlackRock Investment
Adviser, its affiliates or any BlackRock Employee and are not required to be applied to reduce the amount of
the management fee received by a BlackRock Investment Adviser. For a further discussion of the conflicts of
interest arising from the retention of Third-Party Fees by a BlackRock Investment Adviser, its affiliates or any
BlackRock Employee, please refer to Item 11 (“Code of Ethics, Participation or Interest in Client Transactions
and Personal Trading – Conflicts of Interest Presented by the Retention of Third-Party Fees”).

Co-Investments

The BlackRock Investment Advisers from time to time offer certain persons the opportunity to co-invest in
particular investments alongside of a BlackRock Client, subject to certain restrictions. In certain cases where
co-investors participate in an investment, BlackRock Investment Advisers may only allocate expenses
associated with such investment, including broken-deal expenses, to certain Private Funds advised by
BlackRock Investment Advisers (“BlackRock Private Funds”), co-investors and other participants in the
investment.

                               Item 6. Performance-Based Compensation and Side-By-Side Management

Item 6. Performance-Based Compensation and Side-By-Side
Management
As described in Item 5 (“Fees and Compensation”), both:

   (i)     incentive fees and promoted interests after investors receive a specified return; and

   (ii)    investment management fees based on the gross asset value (i.e., the total value of the assets of
           the BlackRock Realty Client inclusive of debt) or net assets (i.e., the total value of the assets of the
           BlackRock Realty Client reduced by the amount of debt of the BlackRock Realty Client),

of a client’s assets depend on the income generated by and/or capital appreciation of the assets of a client.
As such, nearly all BlackRock Realty Clients are subject to fees which are dependent on the performance of
their investments. The extent to which fees of any BlackRock Realty Client are impacted by the performance
of its assets varies from client to client based on the specific fee arrangement. Certain BlackRock Realty
Client fees, such as those based on operating income, do not depend on capital appreciation but are
impacted by the cash flow of the BlackRock Realty Client’s assets. Performance-based fees are generally
payable on a quarterly or annual basis or as investments are realized and/or capital is distributed.

BlackRock Realty Clients should be aware that when BlackRock Realty or an affiliate receives performance-
based fees or BlackRock personnel have any other financial incentive to achieve gains in excess of the
disincentive to suffer losses, BlackRock Realty and/or such personnel have an incentive to choose
investments that are riskier or more speculative than might otherwise be chosen. Similarly, BlackRock Realty
has an incentive to engage in transactions which would result in transaction fees over other transactions.

In addition, BlackRock Realty has established structures to allow promoted interest shares with certain
BlackRock Realty employees to be treated as capital gains to such employees so long as the underlying
income which generated the promoted interest is a capital gain. Accordingly, BlackRock Realty personnel
would have an incentive to pursue investment strategies which are expected to generate capital gains rather
than ordinary income.
...

Item 7. Types of Clients

Special Purpose Entities
In connection with the provision of advisory services to BlackRock Real Estate Separate Accounts and
BlackRock Real Estate Funds, BlackRock Realty also provides services to limited partnerships, group trusts,
REITs, limited liability companies (“LLCs”) and tax-exempt organizations formed pursuant to Section 501(c)
of the Internal Revenue Code owned by BlackRock Real Estate Funds or BlackRock Real Estate Separate
Accounts (“Title Holding Companies”). In most cases, these entities are organized to hold title to real
properties on behalf of BlackRock Realty Clients or to act as borrowers for loans related to such properties.
To the extent permitted by applicable law, BlackRock Realty employees serve as directors, officers and/or
authorized signatories for Title Holding Companies, or in the case of LLCs, BlackRock Realty acts as
manager for Title Holding Companies. BlackRock Realty also provides services to LLCs, Title Holding
Companies and other entities formed for the benefit BlackRock Clients investing in real estate assets which
are not BlackRock Real Estate Separate Accounts or BlackRock Real Estate Funds.