8. MORTGAGE NOTES PAYABLE

Mortgage notes payable consisted of the following:

		Principal as of December 31,				Loan	Interest
Mortgage note property	Notes	2015		2014		Type	Rate (1)			Maturity

Waterman Plaza		$	—	$	3,368,146	Fixed		6.50	%	9/1/2015
Havana/Parker Complex			2,500,000		2,500,000	Fixed		6.51	%	7/1/2016
Bismarck Office Building			3,252,016		3,321,198	Fixed		6.12	%	10/1/2016
Sparky's Rialto	(2)		—		2,119,037	Fixed (reset)		4.75	%	5/3/2018
Rangewood Medical Office Building			1,027,085		1,092,778	Fixed		4.95	%	1/1/2019
Regatta Square			1,183,473		1,214,799	Fixed		4.95	%	1/1/2019
Port of San Diego Complex			10,097,726		10,368,228	Fixed		4.75	%	3/5/2020
Garden Gateway Plaza			6,799,229		6,963,381	Fixed		5.00	%	4/5/2020
Sparky's Lancaster			—		1,903,982	Fixed		5.00	%	6/1/2020
West Fargo Industrial			4,500,000		—	Fixed		4.79	%	9/9/2020
Morena Office Center	(3)		2,289,899		2,351,805	Fixed (reset)		4.50	%	1/1/2021
Pacific Oaks Plaza	(3)		1,556,891		1,599,204	Fixed (reset)		4.50	%	6/1/2021
Shoreline Medical Building	(3)		3,727,569		3,846,697	Fixed (reset)		5.10	%	6/1/2022
Highland Court			6,958,147		—	Fixed		3.82	%	9/1/2022
Sparky's Palm, Joshua and Sunrise			—		7,986,522	Fixed		4.70	%	12/6/2022
Sparky's Hesperia East	(4)		—		830,883	Variable		4.75	%	12/18/2022
Dakota Bank Buildings			10,825,201		10,993,386	Fixed		4.74	%	7/6/2024
Union Terrace Building			6,600,000		6,600,000	Fixed		4.50	%	9/5/2024
The Presidio			6,000,000		6,000,000	Fixed		4.54	%	12/1/2024
Centennial Tech Center			10,237,591		10,250,000	Fixed		4.34	%	12/5/2024
Arapahoe Service Center			8,500,000		8,500,000	Fixed		4.34	%	1/5/2025
Union Town Center			8,440,000		8,440,000	Fixed		4.28	%	1/5/2025
Yucca Valley Retail Center			6,000,000		2,982,411	Fixed		5.62	%	4/6/2025
Executive Office Park	(5)		4,307,975		4,379,854	Fixed (reset)		5.80	%	7/1/2025
Genesis Plaza			6,500,000		4,491,588	Fixed		4.65	%	9/6/2025
One Park Centre			6,610,000		—	Fixed		4.77	%	9/5/2025
Shea Center II			17,727,500		—	Fixed		4.92	%	1/5/2026
Sparky’s Thousand Palms	(6)		—		4,092,100	Variable		5.50	%	3/1/2034
Subtotal, NetREIT, Inc. properties			135,640,302		116,195,999
Model Home mortgage notes			9,050,268		7,703,299	Fixed		(7	)	2015-2019
Mortgage Notes Payable, total		$	144,690,570	$	123,899,298

(1)	Interest rates as of December 31, 2015

(2)	Interest subject to reset; thereafter, monthly payments of $11,982, including interest at rate indexed to 5-year Treasury Rate + 3%.

(3)	Interest rate subject to resetting on the 3r ^d and 6 ^th loan anniversary.

(4)	Interest at a variable rate indexed to the 5 year interest rate swap.

(5)	Interest rate is subject to reset on July 1, 2018.

(6)	Interest at variable rate ranging from 5.50%-10.50%.

(7)	Each Model Home has a standalone mortgage note at interest rates ranging from 4.9% to 5.8% (at December 31, 2015).

The Company is in compliance with all conditions and covenants of its mortgage notes payable.

Scheduled principal payments of mortgage notes payable are as follows:

	Principal Payments				Scheduled
Years Ending December 31:	NetREIT, Inc. Notes Payable		Model Homes Notes Payable		Principal Payments
2016		7,245,568		901,272		8,146,840
2017		1,767,577		1,557,176		3,324,753
2018		5,973,359		1,581,239		7,554,598
2019		2,984,389		1,442,319		4,426,708
2020		2,276,109		3,568,262		5,844,371
Thereafter		115,393,300		-		115,393,300
Total	$	135,640,302	$	9,050,268	$	144,690,570

In December 2014, the Company and the lender for the Company’s Havana Parker Complex entered into to a loan modification agreement pursuant to which the lender agreed to reduce the outstanding loan balance from $3,037,000 to $2,500,000, and also agreed to defer a portion of the monthly interest until loan maturity. Under the modified agreement, interest only payments (at 2.5%) are due through July 1, 2016, at which time all principal and deferred interest is due. The Company has the option to defer loan maturity for one additional year in exchange for making a one-time payment of $100,000 (which will be applied to outstanding principal).