This Quarterly Report on Form 10-Q and other written reports and oral statements made from time to time by the Company may contain so-called "forward-looking statements," all of which are subject to risks and uncertainties. One can identify these forward-looking statements by their use of words such as "expect," "plan," "will," "may," "anticipate," "believe," "estimate," "should," "intend," "forecast," "project" the negative or plural of these words, and other comparable terminology. One can identify them by the fact that they do not relate strictly to historical or current facts. statements are likely to address the Company's growth strategy, financial results and product and development programs. One must carefully consider any such statement and should understand that many factors could cause actual results to differ from the Company's forward-looking statements. These factors include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially. The Company does not assume the obligation to update any forward-looking statement. One should carefully evaluate such statements in light of factors described in the Company's filings with the SEC, especially the Company's Annual Report on Form 10-K and the Company's Quarterly Reports on Form 10-Q. In various filings the Company has identified important factors that could cause actual results to differ from expected or historic results. One should understand that it is not possible to predict or identify all such factors. Consequently, the reader should not consider any such list to be a complete list of all potential risks or uncertainties.





Use of Terms

The following discussion analyzes our financial condition and results of operations for the three months ended March 31, 2022 and 2021. Unless the context indicates or suggests otherwise, reference to "we", "our", "us" and the "Company" in this section refers to the operations of Dream Homes & Development Corporation (DHDC),





                               PLAN OF OPERATION

Building on a history of over 1,700 new homes built and over 400 elevation/renovation/addition projects since 1993, the management of Dream Homes & Development Corporation has positioned the company to emerge as a rapidly growing regional developer of new single-family subdivisions as well as a leader in coastal new home and modular construction, elevation and mitigation. Since Superstorm Sandy flooded 40,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to build new homes or raise their homes to comply with new FEMA requirements. While other involved with coastal construction in Flood Hazard Areas, Dream Homes has excelled. As many of our competitors have failed, Dream Homes has developed a reputation as the region's most trusted builder and has even become known as the "rescue builders have struggled to adapt to the changing market and complex Federal, State and local regulations" builder for homeowners whose projects have been abandoned by others. Due to the damage caused by the storm, as well as the material changes in the FEMA flood maps which now require over 40,000 homeowners along the New Jersey coastline to elevate their homes, Dream Homes is positioned to capitalize on this opportunity for substantial revenue growth.

A new trend in the real estate market which has experienced significant growth in the last year is the emerging Build To Lease trend. This focus and concentration on building both single and multi-family developments with the intention to lease them immediately upon completion is being made in response to several factors. One factor is the extreme shortage of rental properties on the market, not only for first time homemakers, but for retirees, and young professionals who are unclear as to the intentions of settling in one location. The second factor is the overall lender and funding source preference to lend to Build To Lease developments, as opposed to more traditional Build To Sell developments due to the perception of Build To Lease as a safer investment over the long term. Finally, the extraordinary amount of interest from non-traditional sources such as pension and hedge funds, insurance companies and venture capital firms to purchase completed new For Lease developments at attractive metrics based on capitalization rates has spurred a large growth in this market segment.

The Company has made the decision to change focus in their new home developments to better accommodate this growing trend. Currently all new multi-family developments located in Ocean County, which represent a total count of 155 units, will be changed from Build For Sale to Build for Lease. The Company now intends to hold these properties upon completion and lease-up for an indeterminate period of time, and realize the rental income from ownership. This strategy will become a very significant revenue stream for the Company and will become a third division of the Company, behind custom new homes and renovation/elevation projects.

Management recognized that the effects of Super Storm Sandy, which occurred on 10/29/12, would be far reaching and cause an almost unlimited demand for construction services, as well as specific construction information. Due to the damage caused by the storm, as well as the material changes in the FEMA flood maps which now require over 40,000 homeowners along the New Jersey coastline to elevate their homes, management feels that focusing on the construction field will continue to provide a stable revenue stream for the company.

Dream Homes and Development Corporation continues to pursue opportunities in the real estate field, specifically in new home construction, home elevations and renovations. The amount of these projects currently under contract as of December 31, 2021 is $8,504,668.

In addition to the above projects, which are in process, the Company has also estimated an additional $6,500,000 worth of residential construction projects and added over 200 active prospects to its data base. All these prospects are prime candidates for rebuilding and new home projects.





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Properties Currently Owned

Berkeley Terrace - Bayville, NJ - 70 approved townhome units

A contract was signed to acquire 70 approved townhome units in October 2019, after 31 months of discussion, and the property was acquired in late June 2021. Site improvements are scheduled to commence in summer 2023. Sales or rental revenues are scheduled to accrete to 2023 - 2024 income. The Company is actively working with several permanent lenders to finalize an acquisition, development and construction finance facility.

The Company is preparing to begin infrastructure work on the property, and start a prelease program.

Lacey Township, New Jersey, "Dream Homes at the Pines"

Dream Homes is in contract and under development for a parcel which will yield 68 new townhomes in the Ocean County NJ area, of which 54 are market rate and 14 are affordable housing. The acquisition of the contract was made for common stock and occurred in the 4th quarter of 2016. This property is currently in the approval process. This development project is scheduled to begin in late 2022 and will accrete to 2023 sales.

In order to obtain all developmental approvals and be prepared to begin installing infrastructure, various permits and engineering work are required. These permits include but are not limited to township subdivision, county, municipal utility authority, CAFRA (NJ Department of Environmental Protection) and NJ Department of Transportation. To date, design engineering has been completed, a CAFRA application has been prepared and submitted, and the NJ DEP issued a CAFRA permit in October of 2021. Preliminary township approval was granted on April 19th of 2021. Preliminary and Tentative Municipal Utilities Authority approvals have been granted. Ocean County Planning Board approval has been granted. Lacey Township Fire Department approval has been granted.

It is anticipated that complete development approvals will cost approximately $20,000 more to complete. In addition to these approval costs and acquisition costs, infrastructure costs are anticipated to cost approximately $1,000,000. The total amount of funding required to make this property ready for home construction is approximately $1,900,000.

The Company is in active discussions with various lenders to complete the infrastructure and vertical financing portions of this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans.

The closing to acquire this property occurred on June 29, 2021 and the Company is currently in title.

Dream Homes Apartments - Fairview

On May 3, 2018, the Company submitted a signed letter of intent to purchase 5.5 acres of property in Gloucester County, which is currently being approved for a 112-unit apartment complex, with approximately 7600 square feet of retail space. The Company has a signed contract and has been proceeding with development approvals. The property is designated as a redevelopment property, and a redevelopment agreement is currently being negotiated with the township. Progress has been delayed due to township closures due to the Covid-19 pandemic.

On February 26, 2021, the Company took title to the property via an assemblage of 3 parcels.

The Company successfully obtained Redevelopment Approval from the Borough in July 2021 and Preliminary and Final Site Plan approval in December of 2021.

All outside agency approvals have been submitted for and are in process.





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Louis Avenue - Bayville, NJ - In title

In October of 2018, the company entered into a contract to acquire and develop property for 17 townhouse units in Bayville NJ. Engineering and approvals are currently in process. Application was made to the Planning Board on March 20, 2020. The project was deemed complete by the township engineer. Municipal scheduling was delayed due to the Covid-19 virus, but the Company was heard before the Berkeley Township Planning Board on October 3, 2020 and the Company was awarded preliminary approvals for 17 townhome units.

Application is currently being made for final approvals, and the Company is scheduled to be heard at the May 2022 planning board meeting. Subsequent event: The Company received Final approval on May 19, 2022.

The Company acquired this property on August 4, 2021.

The Company intends to develop, lease and retain this property in it's portfolio for the foreseeable future.

The Company acquired this property on August 4, 2021.

Properties Under Contract to Purchase and in the Approval Stage

Autumn Run - Gloucester County

On December 7, 2018, the Company signed a contract to purchase a property in Gloucester County, NJ, which will be approved for +/- 63 units of age-restricted manufactured housing. The property is currently in the approval stage. An application was made to the DEP for a wetlands letter of interpretation, which was approved as proposed. Further action before the planning board is pending due to delays caused by township closures due to Covid-19. The Company had a virtual workshop meeting on September 15, 2020 and an additional virtual meeting was conducted on November 17, 2020.

The application for a use variance was heard on May 24, 2021 and the variance was approved.

The Company is in the process of applying for preliminary and final site plan approval and should be heard at the October 2021 meeting.

Contracts signed and in Due Diligence

The Company has signed a contract to purchase 44 +/- acres in Gloucester county, which is suitable for age-restricted single family development. The projected yield for the property varies between 100 - 160 units, and is subject to environmental, utility and township constraints.





Summary

These four new developments that have recently been acquired as well as the one that is in development represent over $70 million in new home construction projects on the books in the next few years. This work will occur over the next 3-4 years and is in addition to the custom spot lot & elevation/renovation division of the business. Management is very positive about these new developments, as well as the cutting-edge construction technologies being employed to create healthier, safer, more energy efficient homes.

Dream Homes has experienced solid growth in both the new home and elevation divisions, as well as strong additions to our personnel infrastructure, which are just now beginning to bear fruit. Our new Office and Showroom in Brielle has led to an increase in traffic and sales, as well as facilitated and increased client selections throughout our entire northern region.





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The Company was awarded the Ocean County Best of the Best Awards for 2017, 2018, 2019 & 2020 in two categories (Best Custom Modular Builder and Best Home Improvement Contractor), which has caused significant new awareness and interest from the public. This has led to more showroom traffic, completed estimates and signed contracts. Referrals about Dream Homes are also being generated from many industry professionals, such as architects, engineers and attorneys, who've either had clients with abandoned projects or simply want to retain Dream due to superior performance and reliability.

The phrase 'The Region's Most Trusted Builder' accurately describes the company and is becoming increasingly well known to homeowners in need of new homes, elevation & renovation work. The management team has never failed to complete a project in over 28 years in the industry.

The Company's business model over the last year has been focused on increasing the new home and new development portion of our business, until it represents 50% - 70% of our entire revenue stream, from the current level of 20%. New home development has a much greater scalability and growth potential than elevation/renovation work. Though the Company has enjoyed steady growth in the renovation/elevation portion of the company the new homes division continues to represent a greater percentage of total revenue.

Management hopes for steady growth in all segments of the company, since the rebuilding process will occur over the next 15-20 years. The combined total number of homes affected by Storm Sandy that will need to be raised or demolished and rebuilt is in excess of 30,000 homes, of which less than 10,000 have been rebuilt. This remaining combined market for new construction and elevation projects in the Company's market area is estimated to be in the range of $3.4 billion dollars. The company anticipates being able to efficiently address 5% - 10% of this market. Dream Homes' potential operations include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

Due to the opportunities afforded by the market conditions, Dream Homes and Development Corporation will continue to pursue opportunities in the construction and real estate field, specifically in new home construction, home elevations and renovations.





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RESULTS OF OPERATIONS - DREAM HOMES & DEVELOPMENT CORPORATION

The summary below should be referenced in connection with a review of the following discussion of our results of operations for the three months ended March 31, 2022 and 2021.

Results of Operations - Comparison for the three months ended March 31, 2022 and 2021.

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