Bluerock Residential Growth REIT, Inc. - FORM 8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 2, 2012

Bluerock Enhanced Multifamily Trust, Inc.
(Exact Name of Registrant as Specified in Its Charter)

Maryland	333-153135	26-3136483
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)


Heron Tower, 70 East 55th Street, 9th Floor New York, NY 10022
(Address of principal executive offices)

(212) 843-1601
(Registrant’s telephone number, including area code)

None
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS

On October 9, 2012, Bluerock Enhanced Multifamily Trust, Inc. (the “Company”) filed, with the Securities Exchange Commission, a Current Report on Form 8-K dated October 2, 2012 (the “Form 8-K”), in conjunction with the acquisition of a material, indirect equity interest of 48.4% in 198 units of a 220-unit multifamily housing community commonly known as “Enders Place” (the “Enders Property”).

This Current Report on Form 8-K/A (the “Form 8-K/A”) amends Item 9.01 of the Form 8-K to present certain financial statements of the Enders Property and to present certain unaudited pro forma financial statements of the Company in connection with the Company’s acquisition of a material, indirect equity interest in the Enders Property, which financial statement and unaudited pro forma financial information are filed as exhibits hereto. This Form 8-K/A should be read in conjunction with the Form 8-K.

ITEM 7.01 REGULATION FD DISCLOSURE

On December 17, 2012, the Company intends to begin using the following information included in Item 7.01 of this Form 8-K/A in connection with discussing the transaction reported in Item 2.01 of the Form 8-K with stockholders and their financial advisors. The information included in Item 7.01 of this Current Report on Form 8-K is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

Summary Pro Forma Financial Information

An unaudited pro forma consolidated balance sheet for the Company as of September 30, 2012, has been prepared to give effect to the purchase of joint venture interests in the Enders Property as described in Item 2.01 of the Form 8-K as if the purchase of interests occurred on September 30, 2012 (the “Pro Forma Balance Sheet”). The Pro-Forma Balance Sheet has been filed as an exhibit to this Form 8-K/A beginning at page F-5, should be reviewed in its entirety and is subject to the assumptions, adjustments and qualifications described therein. As described in the Pro Forma Balance Sheet, the pro forma effect of these transactions on the Company’s consolidated balance sheet as of September 30, 2012 would be to:

(1) increase total assets from approximately $63.5 million to $89.7 million,

(2) increase mortgage payable liabilities from $41.2 million to approximately $58.7 million,

(3) increase line of credit from zero to approximately $4.8 million,

(4) increase total liabilities from approximately $43.5 million to $66.4 million, and

(4) decrease total stockholders’ equity from approximately $9.9 million to $9.0 million.

In addition to our acquisition of our joint venture interest in the Enders Property described in Item 2.01 of the Form 8-K, on December 3, 2009, we completed an investment in a joint venture to acquire a 432-unit garden-style multifamily community known as Springhouse at Newport News (the “Springhouse Property”), located in Newport News, Virginia. On June 27, 2012, we completed the purchase of an additional joint venture equity interest in the Springhouse Property, bringing our indirect equity interest to 38.25%.

On March 31, 2010, we completed an investment in a joint venture to acquire a 192-unit garden-style multifamily community known as The Reserve at Creekside Village (the “Creekside Property”), located in Chattanooga, Tennessee. On June 27, 2012, we purchased an additional joint venture equity interest in the Creekside Property, bringing our indirect equity interest to 24.607%.

The aggregate purchase price for our acquisitions of the additional joint venture interests in the Springhouse Property and the Creekside Property was $202,532, excluding closing costs.

On June 27, 2012, we also sold all of our joint venture interest in BR Meadowmont Managing Member, LLC (the “Meadowmont Managing Member JV Entity”), for an aggregate sale price of $3.1 million, excluding closing costs and a disposition fee paid to an affiliate of our advisor of $136,216. The Meadowmont Managing Member JV Entity held an indirect 50% equity interest in a 258-unit multifamily community known as The Apartments at Meadowmont, located in Chapel Hill, North Carolina.

An unaudited pro forma consolidated statement of operations of the Company for the nine months ended September 30, 2012 has been prepared to give effect to the purchase of the additional joint venture interests in the Springhouse and Creekside properties and joint venture interest in the Enders Property as if the purchase of interests occurred on January 1, 2011, and to give effect to the disposition of the joint venture interest in the Meadowmont property as if the disposition of the interest occurred on January 1, 2011 (the “September 30, 2012 Pro Forma Statement of Operations”). The September 30, 2012 Pro-Forma Statement of Operations has been filed as an exhibit to this Form 8-K/A beginning at page F-7, should be reviewed in its entirety and is subject to the assumptions, adjustment and qualifications described therein. As described in the September 30, 2012 Pro Forma Statement of Operations, the pro forma effect of these transactions on the Company’s consolidated statement of operations for the nine months ended September 30, 2012 would be to:

(1)

increase total revenues from $1.6 million to approximately $7.1 million,

(2)

increase total expenses from approximately $3.4 million to $6.4 million,

(3)

increase equity in earnings of unconsolidated joint ventures from approximately $4 thousand to $12 thousand,

(4)

increase operating income from a loss of approximately $1.7 million to income of $0.7 million, and

(5)

decrease net income attributable to common shareholders from approximately $3.7 million to $89 thousand.

Additionally, an unaudited consolidated pro forma statement of operations of the Company for the year ended December 31, 2011 has been prepared to give effect to the purchase of the additional joint venture interests in the Springhouse and Creekside properties and joint venture interest in the Enders Property as if the purchase of interests occurred on January 1, 2011, and to give effect to the disposition of the joint venture interest in the Meadowmont property as if the disposition of the interest occurred on January 1, 2011 (the “December 31, 2011 Pro Forma Statement of Operations”). The December 31, 2011 Pro-Forma Statement of Operations has been filed as an exhibit to this Form 8-K/A beginning at page F-9, should be reviewed in its entirety and is subject to the assumptions, adjustment and qualifications described therein. As described in the December 31, 2011 Pro Forma Statement of Operations, the pro forma effect of these transactions on the Company’s consolidated statement of operations for the year ended December 31, 2011 would be to:

(1)

increase total revenues from zero to approximately $8.9 million,

(2)

increase total expenses from $3.9 million to approximately $13.0 million,

(3)

increase equity in earnings of unconsolidated joint ventures from approximately a loss of $74 thousand to earnings of $77 thousand, and

(4)

increase net loss attributable to common shareholders from approximately $4.3 million to $5.2 million.

Item 9.01 Financial Statements and Exhibits.

(a)	Financial Statements of Real Estate Acquired.

Enders Place

		Page
Independent Auditors’ Report		F-1
Historical Statements of Revenues and Certain Direct Operating Expenses for the nine months ended September 30, 2012 (unaudited) and for the year ended December 31, 2011 and the nine months ended September 30, 2011 (unaudited)		F-2
Notes to Historical Statements of Revenues and Certain Direct Operating Expenses for the nine months ended September 30, 2012 (unaudited) and for the year ended December 31, 2011 and the nine months ended September 30, 2011 (unaudited)		F-3

(b) Pro Forma Financial Information.

Bluerock Enhanced Multifamily Trust, Inc.

		Page
Summary of Unaudited Pro Forma Consolidated Financial Statements		F-4
Unaudited Pro Forma Consolidated Balance Sheet as of September 30, 2012		F-5
Notes to Unaudited Pro Forma Consolidated Balance Sheet as of September 30, 2012		F-6
Unaudited Pro Forma Consolidated Statement of Operations for the nine months ended September 30, 2012		F-7
Notes to Unaudited Pro Forma Consolidated Statement of Operations for the nine months ended September 30, 2012		F-8
Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2011		F-9
Notes to Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2011		F-10

Statements in this Current Report on Form 8-K, including intentions, beliefs, expectations or projections relating to items such as the long-term performance of the Company’s portfolio are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based on current expectations and assumptions with respect to, among other things, future economic, competitive and market conditions and future business decisions that may prove incorrect or inaccurate. Important factors that could cause actual results to differ materially from those in the forward looking statements include the risks described in the "Risk Factors" section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 and its other filings with the Securities and Exchange Commission.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.


DATE: December 17, 2012	/s/ Jordan Ruddy
	Jordan Ruddy
	President

Independent Auditors’ Report

Board of Directors and Stockholders

Bluerock Enhanced Multifamily Trust, Inc.

We have audited the accompanying Historical Statement of Revenues and Certain Direct Operating Expenses for the year ended December 31, 2011 of Enders Place at Baldwin Park (the “Property”) acquired pursuant to the purchase agreement between Enders Holdings, LLC and Waypoint Enders Owner, LLC. This financial statement is the responsibility of the Property’s management. Our responsibility is to express an opinion on the financial statement based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Property’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statement. We believe that our audit provides a reasonable basis for our opinion.

The accompanying financial statement was prepared for the purpose of complying with the rules and regulations of the United States Securities and Exchange Commission as described in Note 2 and is not intended to be a complete presentation of the Property’s revenues and expenses.

In our opinion, the Historical Statement of Revenues and Certain Direct Operating Expenses referred to above present fairly, in all material respects, the revenues and certain direct operating expenses described in Note 2 of the financial statement for the year ended December 31, 2011, in conformity with accounting principles generally accepted in the United States of America.

/s/ BDO USA, LLP

Nashville, TN

December 17, 2012

F-1

ENDERS PLACE AT BALDWIN PARK
HISTORICAL STATEMENTS OF REVENUES AND CERTAIN DIRECT OPERATING EXPENSES
(Dollars in thousands)

	For the Year Ended December 31, 2011		Nine Months Ended September 30, 2012		Nine Months Ended September 30, 2011
			(Unaudited)		(Unaudited)
Revenues
Rental income	$	2,825	$	2,272	$	2,095
Other revenue		116		119		85
Total revenues		2,941		2,391		2,180

Certain direct operating expenses
Property operating expenses		339		239		248
Property taxes		505		369		379
Homeowners’ association dues		544		364		408
Management fees		81		66		60
Total certain direct operating expenses		1,469		1,038		1,095

Revenues in excess of certain direct operating expenses	$	1,472	$	1,353	$	1,085

See accompanying notes to historical financial statements.

F-2

ENDERS PLACE AT BALDWIN PARK

NOTES TO HISTORICAL STATEMENTS OF REVENUES AND CERTAIN DIRECT OPERATING EXPENSES

Note 1 – Business

The Enders Place at Baldwin Park (the “Property”) acquisition from Enders Holdings, LLC consists of 198 units of a 220 unit multifamily housing community located in Orlando, Florida.

Note 2 – Basis of Presentation

The accompanying Historical Statements of Revenues and Certain Direct Operating Expenses have been prepared for the purpose of complying with Rule 3-14 of the United States Securities and Exchange Commission Regulation S-X and are not intended to be a complete presentation of the Property’ revenues and expenses. The financial statements have been prepared on the accrual basis of accounting and require management of the Property to make estimates and assumptions that affect the reported amounts of the revenues and expenses during the reporting period. Actual results may differ from those estimates.

In preparation of the accompanying Historical Statements, subsequent events were evaluated for recognition or disclosure through December 17, 2012, which is the date the financial statements were issued.

Note 3 – Unaudited Interim Information

In the opinion of the Property’s management, all adjustments, consisting only of normal and recurring adjustments, necessary for a fair presentation (in accordance with Basis of Presentation as described in Note 2) have been made to the accompanying unaudited amounts for the nine months ended September 30, 2012 and 2011.

Note 4 – Revenues

The Property contains multifamily housing units occupied under various lease agreements with tenants. All leases are accounted for as operating leases. Rental income is recognized as earned over the life of the lease agreements on a straight-line basis. Some of the leases include provisions under which the Property is reimbursed for certain operating costs. Revenue related to these reimbursed costs is recognized in the period the applicable costs are incurred and billed to tenants pursuant to the lease agreements. Other income consists of charges billed to tenants for utilities, carport and garage rental, pets, administrative, application and other fees and is recognized when earned.

Note 5 – Certain Direct Operating Expenses

Certain direct operating expenses include only those costs expected to be comparable to the proposed future operations of the Property. Property operating costs includes property staff salaries, utilities, landscaping, insurance, repairs and maintenance, and other general costs associated with operating the property. Costs such as depreciation, amortization, interest, and professional fees are excluded from the financial statements.

F-3

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

SUMMARY OF UNAUDITED PRO FORMA FINANCIAL STATEMENTS

The following pro forma information should be read in conjunction with the consolidated balance sheet of Bluerock Enhanced Multifamily Trust, Inc (“the Company”) as of September 30, 2012, which has been filed with the SEC in the Company’s quarterly report on Form 10-Q for the quarterly period ended September 30, 2012. In addition, this pro forma information should be read in conjunction with the Historical Statement of Revenues and Certain Direct Operating Expenses of Enders Place at Baldwin Park, which are included herein.

The aggregate purchase price for the Enders Property was $25.1 million, plus closing costs. The acquisition was funded with $9.2 million of gross equity from the Enders JV Entity, and a $17.5 million senior mortgage loan. The terms of the senior mortgage loan are described in Item 2.03 on the Form 8-K. The purchase price for the transaction was determined through negotiations between the Seller and Waypoint Residential, LLC, and its affiliates. Neither we nor our advisor is affiliated with the Seller and there is no material relationship between the Seller and us or our affiliates, or any of our directors, officers or their respective associates, other than in respect of this transaction. In evaluating the Enders Property as a potential investment and determining whether the amount of consideration to be paid was appropriate, a variety of factors were considered, including overall valuation of net rental income, expected capital expenditures, the community features and amenities, location, environmental issues, demographics, price per unit and occupancy.

On December 3, 2009, we completed an investment in a joint venture to acquire a 432-unit garden-style multifamily community known as Springhouse at Newport News (the “Springhouse Property”), located in Newport News, Virginia. On June 27, 2012, we completed the purchase of an additional joint venture equity interest in the Springhouse Property, bringing our indirect equity interest to 38.25%.

The aggregate purchase price for our acquisitions of the additional joint venture interests in the Springhouse Property and the Creekside Property was $202,532, excluding closing costs.

The following unaudited pro forma consolidated balance sheet as of September 30, 2012, has been prepared to give effect to the acquisition of indirect equity interest in Enders Place at Baldwin Park on that date. The following unaudited pro forma statements of operations for the nine months ended September 30, 2012 and for the year ended December 31, 2011 have been prepared to give effect to the acquisition of indirect equity interest in Enders Place at Baldwin Park and the acquisition of additional indirect equity interest in the Springhouse and Creekside properties as if the purchase of interests occurred on January 1, 2011 and to give effect to the disposition of the joint venture interest in the Meadowmont property as if the disposition of the interest occurred on January 1, 2011, with respect to the statement of operations for the nine months ended September 30, 2012 and for the year ended December 31, 2011.

These unaudited pro forma financial statements are prepared for informational purposes only and are not necessarily indicative of future results or of actual results that would have been achieved had the purchases and disposition of joint venture interests been consummated as of the dates indicated. In addition, the pro forma balance sheet includes pro forma preliminary estimates of the fair value of the assets and liabilities acquired in connection with the purchase of interests. These allocations may be adjusted in the future upon finalization of these preliminary estimates.

F-4

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET

As of September 30, 2012


	Bluerock Enhanced Multifamily Trust, Inc. Historical			Pro Forma Adjustments for Enders Place at Baldwin Park			Pro Forma
	(a)			(b)			Total
ASSETS
Real Estate
Land	$	8,420,000		$	4,750,000	(c)	$	13,170,000
Building and improvements		45,434,747			19,156,045	(c)		64,590,792
Furniture, fixtures and equipment		1,447,590			523,710	(c)		1,971,300
Total Gross Real Estate Investments		55,302,337			24,429,755			79,732,092
Accumulated depreciation		(470,972	)		-			(470,972	)
Total Net Real Estate Investments		54,831,365			24,429,755			79,261,120
Investments in unconsolidated real estate joint ventures		2,470,256			-			2,470,256
In-place lease value, net		607,421			670,245	(c)		1,277,666
Cash and cash equivalents		3,846,980			107,415	(c)		3,954,395
Restricted cash		842,371			646,610	(c)		1,488,981
Due from affiliates		622,453			-			622,453
Accounts receivables, prepaids and other assets		241,388			390,438	(c)		631,826
Total Assets	$	63,462,234		$	26,244,463		$	89,706,697

LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Mortgage payable	$	41,239,778		$	17,500,000	(d)	$	58,739,778
Line of credit		-			4,800,000	(e)		4,800,000
Accounts payable		87,104			-			87,104
Other accrued liabilities		986,818			516,207	(c)		1,503,025
Due to affiliates		1,022,406			153,491	(c)		1,175,897
Distributions payable		114,367			-			114,367
Total Liabilities		43,450,473			22,969,698			66,420,171

Commitments and contingencies
Redeemable common stock		230,277			-			230,277

Stockholders' Equity
Preferred stock, $0.01 par value, 250,000,000 shares authorized; none
issued and outstanding		-			-			-
Common stock, $0.01 par value, 749,999,000 shares authorized;
2,028,034 and 1,113,968 shares issued and outstanding as of
September 30, 2012 and December 31, 2011, respectively		20,280			-			20,280
Nonvoting convertible stock, $0.01 par value per share; 1,000 shares
authorized, issued and outstanding		10			-			10
Additional paid-in-capital, net of costs		14,831,676			-			14,831,676
Cumulative distributions and net losses		(4,951,656	)		(923,884	)(f)		(5,875,540	)
Total Stockholders' Equity		9,900,310			(923,884	)		8,976,426
Noncontrolling interest		9,881,174			4,198,649	(g)		14,079,823
Total Equity		19,781,484			3,274,765			23,056,249
TOTAL LIABILITIES AND EQUITY	$	63,462,234		$	26,244,463		$	89,706,697

See Notes to Unaudited Pro Forma Consolidated Balance Sheet

F-5

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET

As of September 30, 2012

(a)

Historical consolidated financial information derived from the Company’s quarterly report on Form 10-Q as of September 30, 2012.

(b)

Represents the purchase of Enders Place at Baldwin Park, which the Company expects to consolidate on its balance sheet. The aggregate purchase price of the Enders property was approximately $25.1 million, plus closing costs. The acquisition was funded with $9.2 million of gross equity of which the Company funded $4.7 million through a joint venture for its 48.4% indirect equity interest, and $17.5 million senior mortgage loan. The cash paid by the Company was funded by cash drawn on its working capital line of credit provided by Bluerock Special Opportunity + Income Fund II, LLC and Bluerock Special Opportunity + Income Fund III, LLC. Amounts presented are at fair value.

(c)

Represents the preliminary purchase price allocations incurred related to the purchase of Enders Place. The Company recorded tangible assets and identifiable intangibles (consisting of in-place leases) based on their estimated fair values.

(d)

Represents mortgage payable assumed at fair value at the date of acquisition.

(e)

Represents draw on working capital line of credit at the date of acquisition.

(f)

Represents the Company’s interest in the fair value of the consolidated property’s net assets acquired at the date of acquisition, excluding deferred financing fees, and any acquisition related expenses on the date of acquisition.

(g)

Represents the noncontrolling interest in the fair value of the consolidated property’s net assets acquired at the date of acquisition, excluding deferred financing fees, and any share of the acquisition related expenses on the date of acquisition.

F-6

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

For the Nine Months Ended September 30, 2012

				Pro-Forma Adjustments
	Bluerock Enhanced Multifamily Trust, Inc. Historical			Springhouse at Newport News			The Reserve at Creekside Village			The Apartments at Meadowmont			Enders Place at Baldwin Park			Pro Forma
	(a)			(b)			(c)			(d)			(e)			Total
Revenue
Net rental income	$	1,563,483		$	1,862,019	(f)	$	1,014,936	(f)	$	-		$	2,271,823	(f)	$	6,712,261
Other		62,282			86,569	(f)		68,557	(f)		-			127,400	(f)		344,808
Total revenues		1,625,765			1,948,588			1,083,493			-			2,399,223			7,057,069
Expenses
Property operating expenses		537,256			487,180	(g)		235,418	(g)		-			174,633	(g)		1,434,487
Management fees		66,092			80,464	(g)		43,589	(g)		-			65,740	(g)		255,885
Depreciation and amortization		1,134,898			101,114	(h)		80,239	(h)		-			546,983	(h)		1,863,234
General and administrative expenses		1,162,263			35,360	(g)		30,177	(g)		(136,525	)		64,340	(g)		1,155,615
Asset management and oversight fees to affiliates		239,866			-			-			(18,359	)		-			221,507
Real estate taxes and insurance		212,085			213,047	(g)		195,549	(g)		-			818,015	(g)		1,438,696
Total expenses		3,352,460			917,165			584,972			(154,884	)		1,669,711			6,369,424

Other operating activities
Equity in earnings (loss) of unconsolidated joint ventures		4,049			13,507	(i)		(8,680	)(i)		3,013			-			11,889
Operating (loss) income		(1,722,646	)		1,044,930			489,841			157,897			729,512			699,534
Other income (expense)
Gain on revaluation of equity on business combination		3,450,460			(2,247,447	)(j)		(1,203,013	)(j)		-			-			-
Gain on sale of joint venture interests		2,014,533			-			-			(2,014,533	)(k)		-			-
Interest expense, net		(452,751	)		84,692	(l)		(261,419	)(m)		-			(791,377	)(n)		(1,420,855	)
Total other (expense) income		5,012,242			(2,162,755	)		(1,464,432	)		(2,014,533	)		(791,377	)		(1,420,855	)

Net (loss) income		3,289,596			(1,117,825	)		(974,591	)		(1,856,636	)		(61,865	)		(721,321	)

Net (loss) income attributable to Noncontrolling Interest		(447,470	)		(110,213	)(o)		(70,162	)(o)		-			(31,923	)(o)		(659,768	)
Net (loss) income attributable to common shareholders	$	3,737,066		$	(1,007,612	)(p)	$	(904,429	)(p)	$	(1,856,636	)	$	(29,942	)(p)	$	(61,553	)

Basic Income (Loss) Per Common Share	$	2.43														$	(0.04	)
Diluted Income (Loss) Per Common Share	$	2.40														$	(0.04	)

Weighted Average Basic Common Shares Outstanding		1,537,554															1,537,554
Weighted Average Diluted Common Shares Outstanding		1,583,873															1,583,873

F-7

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

For the Nine Months Ended September 30, 2012

(a)

Historical consolidated financial information derived from the Company’s quarterly report on Form 10-Q for the nine months ended September 30, 2012.

(b)

Represents adjustments to historical operations of the Company to give effect to the purchase of additional joint venture interest in the Springhouse Property as if these assets had been acquired on January 1, 2011, which would result in consolidation of the operations of the Springhouse Property on the Company’s consolidated statement of operations, including pro forma adjustments, for the entire period. Pro forma adjustments for the period prior to acquisition were derived directly from the property’s actual results of operations for that period. For the period subsequent to acquisition, June 28, 2012 through September 30, 2012, actual results are included in the historical consolidated financial information presented for the nine months ended September 30, 2012.

(c)

Represents adjustments to historical operations of the Company to give effect to the purchase of additional joint venture interest in the Creekside Property as if these assets had been acquired on January 1, 2011, which would result in consolidation of the operations of the Creekside Property on the Company’s consolidated statement of operations, including pro forma adjustments, for the entire period. Pro forma adjustments for the period prior to acquisition were derived directly from the property’s actual results of operations for that period. For the period subsequent to acquisition, June 28, 2012 through September 30, 2012, actual results are included in the historical consolidated financial information presented for the nine months ended September 30, 2012.

(d)

Reflects sale of the Company’s 32.5% equity interest in BR Meadowmont Managing Member, LLC (the “Meadowmont Managing Member JV Entity”) to Bluerock Special Opportunity Fund II, LLC, for an aggregate purchase price of $3.1 million, excluding closing costs and a disposition fee paid to an affiliate of the Advisor of $136,216.

(e)

Represents adjustments to historical operations of the Company to give effect to the purchase of Enders Place as if these assets had been acquired on January 1, 2011. Adjustments were derived directly from the property’s actual results of operations, including pro forma adjustments, for the nine months ended September 30, 2012.

(f)

Represents base rental income, operating cost reimbursements and other income from tenants (not reflected in the historical statement of operations of Bluerock Enhanced Multifamily Trust, Inc.) for the nine months ended September 30, 2012. For the Springhouse and Creekside properties, pro forma adjustments for the period prior to acquisition were derived directly from the property’s actual results of operations for that period. For the period subsequent to acquisition, June 28, 2012 through September 30, 2012, actual results are included in the historical consolidated financial information presented for the nine months ended September 30, 2012.

(g)

Represents rent-related expenses and expenses related to other operating activities based on historical operating results of each property. For the Springhouse and Creekside properties, pro forma adjustments for the period prior to acquisition were derived directly from the property’s actual results of operations for that period. For the period subsequent to acquisition, June 28, 2012 through September 30, 2012, actual results are included in the historical consolidated financial information presented for the nine months ended September 30, 2012.

(h)

Represents depreciation and amortization expense for the nine months ended September 30, 2012 based on the preliminary allocation of the purchase. Depreciation expense is calculated using the straight-line method over the estimated useful life of 30 – 35 years for the building, 15 years for building and land improvements and five years for furniture, fixtures and equipment. Amortization expense on identifiable intangible assets is recognized using the straight-line method over the life of the lease, which is generally less than one year. For the Springhouse and Creekside properties, pro forma adjustments for the period prior to acquisition were derived for that period based on the determined fair value of the assets at the date of acquisition. For the period subsequent to acquisition, June 28, 2012 through September 30, 2012, actual results are included in the historical consolidated financial information presented for the nine months ended September 30, 2012.

F-8

(i)

Represents the write-off of the Company’s equity interest in each property, upon consolidation of each property’s historical financial information.

(j)

Represents gain recognized upon acquisition, less associated acquisition costs, reflected in the historical statement of operations of Bluerock Enhanced Multifamily Trust, Inc., but that would have been recognized in a previous period as assets are assumed to have been acquired on January 1, 2011.

(k)

Represents gain recognized upon sale, less associated disposition costs, reflected in the historical statement of operations of Bluerock Enhanced Multifamily Trust, Inc., but that would have been recognized in a previous period as assets are assumed to have been sold on January 1, 2011.

(l)

Represents decrease in interest expense associated with a $23.4 million mortgage loan which bears a fixed interest rate of 5.66% and matures on January 1, 2020, net of the amortization of the fair value of debt at acquisition date adjustment, calculated as if the loan were acquired on January 1, 2011.

(m)

Represents additional interest expense associated with a $13.0 million mortgage loan which bears a fixed interest rate of 4.60% and matures on November 11, 2050, net of the amortization of the fair value of debt adjustment, as if the loan was acquired on January 1, 2011.

(n)

Represents interest expense incurred on a $17.5 million mortgage loan which bears a fixed interest rate of 3.97% that matures on November 1, 2022 and interest expense incurred on a $4.8 million draw from a working capital line of credit which bears an interest rate of 7.50%.

(o)

Represents the noncontrolling interest in the consolidated property’s net income (loss).

(p)

Represents the Company’s interest in the consolidated property’s net income (loss).

F-9

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

For the Year Ended December 31, 2011

				Pro-Forma Adjustments
	Bluerock Enhanced Multifamily Trust, Inc. Historical			Springhouse at Newport News			The Reserve at Creekside Village			The Apartments at Meadowmont			Enders Place at Baldwin Park			Pro Forma
	(a)			(b)			(c)			(d)			(e)			Total
Revenue
Net rental income	$	-		$	3,721,795	(f)	$	1,954,615	(f)	$	-		$	2,824,675	(f)	$	8,501,085
Other		-			190,911	(f)		125,518	(f)		-			124,181	(f)		440,610
Total revenues		-			3,912,706			2,080,133			-			2,948,856			8,941,695
Expenses
Property operating expenses		-			946,380	(g)		475,381	(g)		-			229,902	(g)		1,651,663
Management fees		-			165,424	(g)		85,937	(g)		-			80,939	(g)		332,300
Depreciation and amortization		-			1,870,632	(h)		1,145,637	(h)		(2,316	)		1,399,556	(h)		4,413,509
General and administrative expenses		3,564,948			99,961	(g)		120,356	(g)		(165,937	)		775,325	(g)		4,394,653
Asset management and oversight fees to affiliates		330,156			-			-			(46,140	)		-			284,016
Real estate taxes and insurance		-			417,807	(g)		361,099	(g)		-			1,118,444	(g)		1,897,350
Total expenses		3,895,104			3,500,204			2,188,410			(214,393	)		3,604,166			12,973,491

Other operating activities
Equity in loss (earnings) of unconsolidated joint ventures		73,665			(84,326	)(i)		(46,768	)(i)		(19,850	)		-			(77,279	)
Operating (loss) income		(3,968,769	)		496,828			(61,509	)		234,243			(655,310	)		(3,954,517	)
Other income (expense)
Interest expense, net		(346,562	)		(987,118	)(j)		(537,919	)(k)		8,803			(1,054,415	)(l)		(2,917,211	)
Total other (expense) income		(346,562	)		(987,118	)		(537,919	)		8,803			(1,054,415	)		(2,917,211	)

Net (loss) income		(4,315,331	)		(490,290	)		(599,428	)		243,046			(1,709,725	)		(6,871,728	)

Net (loss) income attributable to Noncontrolling Interest		-			(302,754	)(m)		(451,331	)(m)		-			(882,218	)(m)		(1,636,303	)
Net (loss) income attributable to common shareholders	$	(4,315,331	)	$	(187,536	)(n)	$	(148,097	)(n)	$	243,046		$	(827,507	)(n)	$	(5,235,425	)

Basic and Diluted Loss Per Common Share	$	(5.34	)													$	(6.47	)

Weighted Average Common Shares Outstanding		809,304															809,304

See Notes to Unaudited Pro Forma Consolidated Statement of Operations

F-10

BLUEROCK ENHANCED MULTIFAMILY TRUST, INC.

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

For the Year Ended December 31, 2011

(a)

Historical consolidated financial information derived from the Company’s annual report on Form 10-K for the year ended December 31, 2011.

(b)

(c)

(d)

(e)

(f)

(g)

Represents rent-related expenses and expenses related to other operating activities based on historical operating results of each property.

(h)

Represents depreciation and amortization expense for the year ended December 31, 2011 based on the preliminary allocation of the purchase price. Depreciation expense is calculated using the straight-line method over the estimated useful life of 30 – 35 years for the building, 15 years for building and land improvements and five years for furniture, fixtures and equipment. Amortization expense on identifiable intangible assets is recognized using the straight-line method over the life of the lease, which is generally less than one year.

(i)

Represents the write-off of the Company’s equity interest in each property, upon consolidation of each property’s historical financial information.

(j)

Represents interest expense incurred on a $23.4 million mortgage loan which bears a fixed interest rate of 5.66% and matures on January 1, 2020, net of the amortization of the fair value of debt adjustment.

(k)

Represents interest expense incurred on a $13.0 million mortgage loan which bears a fixed interest rate of 4.60% and matures on November 11, 2050, net of the amortization of the fair value of debt adjustment.

(l)

(m)

Represents the noncontrolling interest in the consolidated property’s net income (loss).

(n)

Represents the Company’s interest in the consolidated property’s net income (loss).

F-11

Bluerock Residential Growth REIT, Inc. - FORM 8-K/A - December 17, 2012

Bluerock Residential Growth REIT, Inc. Reports