INVESTMENT OFFERING $1,334,000 / 6.00% CAP Longhorn steakhouse - CORPORATE GROUND LEASE

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1 Valley Crossing Rep Photo INVESTMENT OFFERING $1,334,000 / 6.00% CAP Longhorn steakhouse - CORPORATE GROUND LEASE EXP DALLAS JOE CAPUTO joe@exp1031.com BOB MOORHEAD bob@exp1031.com property. Newly constructed 6,242+ building on acre high visibility site. tenant. RARE Hospitality, Inc. dba LongHorn Steakhouse (Darden Restaurants, Inc. subsidiary). 386 LongHorn Steakhouse locations. Darden Restaurants, Inc Revenue: $7.5 billion. lease structure. Brand new, 10-year corporate ground lease with 10% rental increase every 5-years. location. Along US Highway 83 (86,778 Cars / Day). Outparcel to JC Penney, TJ Maxx, Petco, Academy Sports & Outdoors, and Petco. Adjacent to Olive Garden. Next to Lowe s Home Improvement, Walmart Supercenter, Academy Sports & Outdoors, Mattress Firm, Gamestop, and Subway. Fastest Growing Metro Area in the Nation Fiscal Times, 2012 No. 4 Best Mid-Sized Cities for Jobs Forbes, 2011 Ranked a Top 100 Leading Location for Doing Business Area Development Magazine, 2011 Texas / Mexico Corridor Named a Top Region to Watch for Automotive Manufacturing Revival Forbes, 2012.

2 Table of contents Disclaimer PAGE 1: PAGE 2: PAGE 3: PAGE 4: PAGE 5: PAGE 6: PAGE 7-8: PAGE 9: COVER TABLE OF CONTENTS DISCLAIMER INVESTMENT TENANT LEASE OVERVIEWS SITE PLAN AERIAL PHOTOGRAPH LOCATION OVERVIEW LOCATION MAPS DEMOGRAPHICS REP PHOTO Disclaimer EXP Realty Advisors, Inc. ( Agent ) has been engaged as an agent for the sale of the property located at 725 E. Expressway 83, Weslaco, TX by the owner of the Property ( Seller ). The Property is being offered for sale in an as-is, where-is condition and Seller and Agent make no representations or warranties as to the accuracy of the information contained in this Offering Memorandum. The enclosed materials include highly confidential information and are being furnished solely for the purpose of review by prospective purchasers of the interest described herein. The enclosed materials are being provided solely to facilitate the prospective investor s own due diligence for which it shall be fully and solely responsible. The material contained herein is based on information and sources deemed to be reliable, but no representation or warranty, express or implied, is being made by Agent or Seller or any of their respective representatives, affiliates, officers, employees, shareholders, partners and directors, as to the accuracy or completeness of the information contained herein. Summaries contained herein of any legal or other documents are not intended to be comprehensive statements of the terms of such documents, but rather only outlines of some of the principal provisions contained therein. Neither the Agent nor the Seller shall have any liability whatsoever for the accuracy or completeness of the information contained herein or any other written or oral communication or information transmitted or made available or any action taken or decision made by the recipient with respect to the Property. Interested parties are to make their own investigations, projections and conclusions without reliance upon the material contained herein. Seller reserves the right, at its sole and absolute discretion, to withdraw the Property from being marketed for sale at any time and for any reason. Seller and Agent each expressly reserves the right, at their sole and absolute discretion, to reject any and all expressions of interest or offers regarding the Property and/or to terminate discussions with any entity at any time, with or without notice. This offering is made subject to omissions, correction of errors, change of price or other terms, prior sale or withdrawal from the market without notice. Agent is not authorized to make any representations or agreements on behalf of Seller. Seller shall have no legal commitment or obligation to any interested party reviewing the enclosed materials, performing additional investigation and/or making an offer to purchase the Property unless and until a binding written agreement for the purchase of the Property has been fully executed, delivered, and approved by Seller and any conditions to Seller s obligations hereunder have been satisfied or waived. By taking possession of and reviewing the information contained herein, the recipient agrees that (a) the enclosed materials and their contents are of a highly confidential nature and will be held and treated in the strictest confidence and shall be returned to Agent or Seller promptly upon request; and (b) the recipient shall not contact employees or tenants of the Property directly or indirectly regarding any aspect of the enclosed materials or the Property without the prior written approval of the Seller or Agent; and (c) no portion of the enclosed materials may be copied or otherwise reproduced without the prior written authorization of Seller and Agent.

3 INVESTMENT OVERVIEW PRICE: $1,334,000 CAP RATE: 6.00% NET OPERATING INCOME: $80,000 BUILDING AREA: 6,242+ Square Feet LAND AREA: Acres Lease overview Leasable Area: Approximately 6,242 Square Feet Initial Lease Term: 10-Years Options to Renew: 4, 5-Year Options to Renew Projected Rent Commencement: August 2013 Projected Lease Expiration (Primary Term): August 2023 Lease Type: Corporate Ground Lease YEAR BUILT: 2013 (Under Construction) Rent Increases: 10% Increase After Every 5 th Year OWNERSHIP: OCCUPANCY: 100% Fee Simple Interest Year 1-5 Annual Rent (Current): $80,000 Year 6-10 Annual Rent: $88,000 Year Annual Rent (Option 1): $96,800 Year Annual Rent (Option 2): $106,480 Tenant overview RARE, Hospitality, Inc., a Georgia corporation dba LongHorn Steakhouse Year Annual Rent (Option 3): $117,128 Year Annual Rent (Option 4): $128,840 LongHorn Steakhouse LongHorn Steakhouse is an American casual dining restaurant chain that is owned and operated by Darden Restaurants, Inc. LongHorn Steakhouse was founded in 1981 by George McKerrow, Jr. The first location, originally called LongHorn Steaks Restaurant & Saloon, opened on Peachtree Street in Atlanta, Georgia. By 1990, the franchise expanded further south. It primarily has locations throughout the Eastern United States. It also has a few locations in the Midwest, Southwest, and Puerto Rico. The restaurant is best known for serving various kinds of steak, including its "Flo's Filet. RARE Hospitality, Inc. (Guarantor) In August 2007, LongHorn Steakhouse, formerly owned and operated by RARE Hospitality International Inc., was purchased by Darden Restaurants, Inc. At the end of fiscal 2012, there were 386 LongHorn Steakhouse and 46 The Capital Grille restaurants. The number of restaurants open had increased by 32 and 2, respectively over the past year. Over the course of fiscal LongHorn Steakhouse restaurants and 3 Capital Grille restaurants are expected to be opened. SUBJECT PROPERTY Darden Restaurants NYSE: DRI PRIOR TO PANDA EXPRESS EXPANSION Darden Restaurants, Inc. is a multi-brand restaurant operator headquartered in an unincorporated area in Orange County, Florida, near Orlando. The firm owns several casual dining restaurant chains, most notably Olive Garden, LongHorn Steakhouse, and Red Lobster. Darden owns and operates 1,936 restaurant locations throughout North America and has more than 180,000 employees. The company operates restaurants in all 50 states, including 674 Red Lobster, 786 Olive Garden, 30 Bahama Breeze, 23 Seasons 52, 11 Eddie V's restaurants, and 2 specialty restaurants: Hemenway's Seafood Grille & Oyster Bar and The Old Grist Mill Tavern in addition to the 2 RARE Hospitality concepts. Darden does not franchise its restaurants in the United States. In 2011 the company had total sales of $7.5 billion and a net income of $476.3 million. 3

4 SITE PLAN 4

5 Aerial photograph Texas Boulevard (28,742 Cars / Day) Bridge Avenue (13,885 Cars / Day) Mid Valley Airport US Highway 83 (86,778 Cars / Day) South Texas College 5

6 LOCATION OVERVIEW IMMEDIATE TRADE AREA Longhorn Steakhouse is strategically located in the Valley Crossing Shopping Center (176,618 SF) along US Highway 83 (86,778 Cars / Day) near the intersection with Texas Boulevard (28,742 Cars / Day) in Weslaco, Texas. The subject property is an outparcel to JC Penney, TJ Maxx, Petco, and Academy Sports and Outdoors. The site is also adjacent to Lowe s Home Improvement, and Olive Garden. The property is across from a Walmart Supercenter and is next to Anna s Linens, and Mattress Firm. Pizza Hut, Church s Chicken, McDonalds, GameStop, Pep Boy s Auto, and Jack in the Box are also located in immediate proximity to the subject property. An HEB anchored shopping center is located along US Highway 83 to the west of the site. This shopping center includes Whataburger and Taco Bell outparcel tenants. Other retailers in the trade area include Home Depot, Buffalo Wild Wings, Chili s, and Quizno s. Additionally, the Mid Valley Campus of South Texas College (30,000 students) is 1.7-miles to the southwest of the site. Aggregate annual consumer spending within a 3-mile radius of the subject property totals to $328 million. Total annual entertainment spending within the same radius is $28 million. WESLACO, TX Weslaco is a city in southeast Texas approximately halfway between the cities of McAllen and Harlingen. Weslaco derives its name from the W. E. Stewart Land Company, and grew famous during the Second World War as The Sandbagging Capital of the World due to the city s prolific sandbag output as part of the greater war effort in the United States. The city is part of the McAllen-Edinburg-Mission Metropolitan Statistical Area. The population at the 2010 United States Census was 35,670. Hidalgo County, Texas is one of the fastest-growing counties in the United States, and is the seventh most-populous county in Texas. Its population in 2010 was 774,769, a 35% increase from the 2000 census. During the past two decades, the area has made bold advances, with unprecedented growth in both population and industrial attraction. McAllen is the county s largest city: it ranks 15th among Texas cities, 12th in overall retail sales, and 3rd in the state in total retail sales per household and per capita. MCALLEN EDINBURG MISSION (MSA) The McAllen Edinburg Mission Metropolitan Statistical Area (MSA), as defined by the United States Census Bureau, is an area consisting of one county, Hidalgo, in the Rio Grande Valley region of South Texas. The MSA is anchored by the cities of McAllen, Edinburg, Pharr and Mission. As of the 2000 census, the MSA had a population of 569,463. According to the 2010 census, the population had reached 774,769. This population increase of 36.05% places it as the 11th fastest growing metropolitan statistic area from 2000 to 2010 in the United States. The McAllen-Edinburg-Mission MSA is also part of the transnational metropolitan area (TMA) of Reynosa McAllen, known unofficially as RioPlex or BorderPlex. The transnational statistical area is represented by 40 of America s top 100 retailers. More than 80 of Fortune 500 s global manufacturers have operations in the MSA. Included among them are: AT&T, Bissell, Black & Decker, BMW, Delco, Drexel, Meyer, Eaton, Emerson, GE, Johnson Controls, Nokia, R.R. Donnelley & Sons, Panasonic, Siemens, Sony, Symbol, TRW, West Bend and Whirlpool. The TMA is the retail center of South Texas and Northern Mexico, drawing from a consumer base of over 8.2 million people. The Rio Grande Valley and the rest of South Texas are among the most dynamic regions of Texas. In a recent economic report by the State Comptroller the economic outlook of the region was rated as excellent with a job creation expected to outpace that of the rest of the state through This sector has become the driving force in the local economy, which has grown 138% over the last decade to over $3.58 billion and employing 27% of the local workforce. MSA / TMA ACCOLADES: Fastest Growing Metro Area in the Nation Fiscal Times, No. 1 Best Housing Market in the Nation Wall Street Journal, Texas/Mexico Corridor a Region to Watch for Auto Manufacturing Forbes, 2012 No. 4 Best Mid-Sized Cities for Jobs Forbes, Top 100 Location for Doing Business Area Development Magazine, 2011 One of the Top Ten Best Areas for Recession Recovery -Forbes, One of the Best Places to Launch a Small Business CNN Money, MSA Ranked 1st in High Technology Sector Growth in MSA has the 3rd Lowest Cost of Living in the US. McAllen 16th in Mid-Size Cities and 23rd overall for Small Business Growth. Mexican Nationals Account for 20% to 35% of Border Exported Retail Sales. 6

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9 DEMOGRAPHICS Demographic snapshot Radius 1 Mile 3 Mile 5 Mile Population: 2016 Projection 12,588 58, , Estimate 11,910 53,233 98, Census 12,058 52,752 97,401 Growth % 10.80% 11.30% Growth % 0.90% 1.60% 2011 Households: 2016 Projection 4,169 17,811 31, Estimate 3,920 15,950 27, Census 3,967 15,779 27,522 Growth % 11.70% 12.00% Growth % 1.10% 1.60% Owner Occupied 2,353 10,719 19,132 Renter Occupied 1,567 5,231 8, Avg Household Income $37,381 $37,115 $34, Med Household Income $23,896 $25,963 $24, Per Capita Income $12,787 $11,559 $10, Households by Household Inc: Income Less than $15,000 1,348 4,569 8,464 Income $15,000 - $24, ,108 5,707 Income $25,000 - $34, ,308 3,979 Income $35,000 - $49, ,519 4,270 Income $50,000 - $74, ,813 3,104 Income $75,000 - $99, ,260 Income $100,000 - $149, Income $150,000 - $199, Income $200, McAllen-Reynosa International Bridge McAllen, Texas 9

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