EXCLUSIVE OFFERING $2,400,000 / 5.00% CAP PANERA BREAD GROUND LEASE

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1 EXCLUSIVE OFFERING $2,400,000 / 5.00% CAP PANERA BREAD GROUND LEASE JOE CAPUTO joe@exp1031.com BOB MOORHEAD bob@exp1031.com RUSSELL SMITH russell@exp1031.com property. Newly constructed Panera Bread Bakery-Cafe. 4,475+ SF building on 0.9+ acre lot. tenant. Rolling Dough, Ltd., Lessee, is a growing franchisee that operates 15 Panera s and 5 Carl s Jr. throughout Greater Houston. The Panera Bread legacy began in 1981 as Au Bon Pain Co and as of September 24, 2013, there are 1,736 bakery-cafes in 45 states and in Ontario Canada. lease structure. Brand new, 20-year, absolute NNN lease commenced in October 2013 with a 10% increase every 5-years through the primary term and in each option period. location. Panera Bread is a Walmart Supercenter pad site located at the corner of Houston Beltway 8 (92,000 Cars / Day) and Wallisville Road (31,193 Cars / Day). The subject property is across Wallisville Road from the New Forest Crossing (342,942 SF) shopping center. This development is anchored by Lowe s Home Improvement and includes big box retailers such as Petsmart, Big Lots, Ross, and Anna s Linens. The site is caddy corner to the Shops at Stone Park (261,427 SF). This complex is anchored by JC Penney, Best Buy, Staples, Marshall s, and Party City. Houston, TX: 4 th largest city in US. Houston-Sugar Land- Baytown MSA Population: 5,946,800.

2 Table of contents Disclaimer PAGE 1: PAGE 2: PAGE 3: PAGE 4: PAGE 5-6: PAGE 7: PAGE 8: PAGE 9-10: PAGE 11: COVER TABLE OF CONTENTS DISCLAIMER INVESTMENT OVERVIEW SITE PLAN PROPERTY PHOTOS AERIAL PHOTO LOCATION OVERVIEW LOCATION MAPS DEMOGRAPHICS Subject Property Disclaimer EXP Realty Advisors, Inc. ( Agent ) has been engaged as an agent for the sale of the property located in the southwest corner of Wallisville Road, Houston, TX by the owner of the Property ( Seller ). The Property is being offered for sale in an as-is, whereis 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: $2,400,000 CAP RATE: 5.00% NET OPERATING INCOME: $120,000 Lease overview Initial Lease Term: 20-year term with 4, 5-year options to extend Rent Commencement: October 2013 Lease Expiration: October 2033 Lease Type: Absolute NNN Ground Lease BUILDING AREA: 4,475+ Square Feet Rent Increases: 10% every 5-years through term and options LAND AREA: 0.9+ Acres YEAR BUILT: 2013 OWNERSHIP: Fee Simple Interest OCCUPANCY: 100% Year 1-5 Annual Rent (Current): $120,000 Year 6-10 Annual Rent: $132,000 Year Annual Rent: $145,200 Year Annual Rent: $159,720 Year Annual Rent (Option 1): $175,692 Year Annual Rent (Option 2): $193,261 Tenant overview ROLLING DOUGH, LTD., dba Panera Bread Year Annual Rent (Option 3): $212,587 Year Annual Rent (Option 4): $233,846 Franchisee: Rolling Dough, LTD (Lessee) Rolling Dough, Ltd. is a franchisee of Panera Bread in Houston, Texas. The company was founded in 2003 and currently operates 15 Panera bakery-cafes located throughout Houston. Rolling Dough recently opened locations in League City and College Station. This franchisee also operates 5 Carl s Jr. locations which operate under a different entity and are not part of the lease guaranty. Panera Bread NASDAQ: PNRA Au Bon Pain Co. purchased the St. Louis Bread Company in In 1999 the company changed its name and sold its other chains, including former namesake company Au Bon Pain, in order to expand Panera Bread into a national company. Today, Panera Bread Company, together with its subsidiaries, owns, operates, and franchises quick-casual retail bakery-cafes in the United States and Canada. As of September 24, 2013, it operated approximately 1,736 bakery-cafes in 45 states under the Panera Bread, Saint Louis Bread Co., and Paradise Bakery & Cafe. The company was founded in 1981 and is based in Sunset Hills, Missouri. Panera Bread ranked 37th on BusinessWeek s list of Hot Growth Companies in 2005, and in 2008 Health magazine judged the company as North America s healthiest fast casual restaurant. Panera Bread scored the highest level of customer loyalty among quick-casual restaurants, according to research conducted by TNS Intersearch. It ranked #2 among Excellent Large Fast-Food Chains (500 or more units) in the Sandelman & Associates 2011 Quick-Track Study. Zagat named it the Top Rated Facility, the Best Salad, and Best Healthy Option amongst chain restaurants with less than 5,000 outlets. Panera Bread was also named to BusinessWeek s 2010 list of top 25 Customer Service Champs, to FORTUNE magazine s 2010 list of 100 Fastest-Growing Companies, and has also won awards and recognition in nearly every market in which it has locations. Recently, Panera Bread was named Casual Dining Brand of the Year in the 2012 Harris Poll EquiTrend. Panera Bread Co. s 2011 fiscal annual revenue was $1.8 billion with an annual profit of $136.0 million. The company s cash flow from operating activities was $237 million. Average annual appreciation is 32.8% since the company s IPO in There is no debt on the Panera Bread Co. balance sheet. Panera Bread Co. s 52-week range trading high is PNRA closed at on 7/10/

4 Site plan 4

5 PROPERTY PHOTO 5

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7 Aerial photo Houston Beltway 8 (92,000 Cars / Day) New Forest Crossing Shops at Stone Parke Shops at Wallisville Lance Corporal Anthony Aguirre Jr. High School 7

8 Location overview IMMEDIATE TRADE AREA Panera Bread is a Walmart Supercenter pad site located at the corner of Houston Beltway 8 (92,000 Cars / Day) and Wallisville Road (31,193 Cars / Day). Houston Beltway 8 is an outer ring road that encircles the city of Houston and provides direct access between the city s northern suburbs and the Houston Ship Channel which is just west of the site. Wallisville Road is a primary arterial road that traverses the northeastern part of the Greater Houston area and connects the Houston Ship Channel with the Houston central business district. The traffic volumes, growth, population density, and accessibility of the immediate trade area have attracted numerous nationally known retail brands to the trade area. The subject property benefits significantly from a densely populated surrounding residential area and robust population growth. 15,533 people reside within a 1-mile radius of the site. The population within this radius is projected to grow at a 7.0% rate over the next 5-years. The subject property is across Wallisville Road from the New Forest Crossing (342,942 SF) shopping center. This development is anchored by Lowe s Home Improvement and includes big box retailers such as Petsmart, Big Lots, Ross, and Anna s Linens. CVS, Buffalo Wild Wings, Carino s, and Applebee's are also located in New Forest Crossing. The site is caddy corner to the Shops at Stone Park (261,427 SF). This complex is anchored by JC Penney, Best Buy, Staples, Marshall s, and Party City. Chipotle and Chick-fil-A are also located in this shopping center. Additional nearby retailers include Verizon Wireless, Wingstop, JPMorgan Chase Bank, Taco Bell, Wendy s Discount Tire, and La Quinta. CHANNELVIEW / GALENA PARK, TEXAS The subject property is located in an unincorporated part area of Harris County adjacent to Galena Park (Population: 10,887) to the west and Channelview (Population: 38,289) to the east. The growth of this area has been driven primarily by the Houston Ship Channel. The channel is a 50-mile waterway that is part of the Port of Houston and is the conduit for ocean-going vessels between the Houstonarea shipyards and the Gulf of Mexico. The channel hosts more than 60 ship and 340 barge movements daily and serves as a backbone to shipping petroleum refined at the numerous adjacent facilities. Oil giants which include Exxon, Royal Dutch Shell, Valero, and Lyondell Basell operate refineries in the area. These 5 facilities alone refine over 1.35 million barrels of oil per day. Local growth in the oil and gas industry has led to a boom in engineering, logistics, refining, and pipeline work making the area surrounding the Houston Ship Channel a highly desirable residential location. HOUSTON-SUGAR LAND-BAYTOWN METROPOLITAN AREA The Houston-Sugar Land-Baytown Metropolitan Statistical Area (MSA), colloquially known as Greater Houston, is the 6 th largest in the United States with a population of 5,946,800. From 2000 to 2030, the metropolitan area is projected by Woods & Poole Economics to rank fifth in the nation in population growth adding 2.66 million people. In 2006, Greater Houston ranked 1 st in Texas and 3 rd in the U.S. within the category of "Best Places for Business and Careers" by Forbes. The Greater Houston Gross Metropolitan Product (GMP) in 2005 was $308.7 billion, up 5.4 percent from 2004 in constant dollars. By 2010, the GMP rose to $384 billion, 5 th in the nation. Only 28 nations other than the United States have a GDP exceeding the Greater Houston GMP. Mining, which in Houston is almost entirely oil and gas exploration and production, accounts for 11% of Greater Houston's GMP. Houston is 2 nd to New York City in Fortune 500 headquarters. Galveston Bay and the Buffalo Bayou together form one of the most important shipping hubs in the world, and the Port of Houston, the Port of Texas City, and the Port of Galveston are all major seaports located in Greater Houston. The area is one of the leading centers of the energy industry, particularly petroleum processing, and many companies have large operations in this region. The MSA comprises the largest petrochemical manufacturing area in the world, including for synthetic rubber, insecticides, and fertilizers. Much of metro area's success as a petrochemical complex is enabled by the Houston Ship Channel. The area is also the world's leading center for building oilfield equipment, and is a major center of biomedical research, aeronautics, and high-technology. Because of these economic trades, many residents have moved to the Houston area from other U.S. states, as well as hundreds of countries worldwide. Houston is home to the Texas Medical Center the largest medical center in the world several universities (including Rice University, Texas Southern University, and The University of Houston), and two of the largest systems of higher learning in the United States (The Houston and Lone Star Community College systems). The University of Houston s annual impact on the Houston-area's economy alone equates to that of a major corporation: $1.1 billion in new funds attracted annually to the Houston area, $3.13 billion in total economic benefit, and 24,000 local jobs generated. CNN/Money and Money Magazine have recognized 5 cities in the Greater Houston area the past 3-years as part of its 100 Best Places to Live in the United States. 8

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11 Demographics DEMOGRAPHIC SNAPSHOT Radius 1 Mile 3 Mile 5 Mile Population: 2018 Projection 17, , , Estimate 15, , , Census 14,350 93, ,367 Growth % 9.25% 9.22% Growth % 8.89% 8.77% Households: 2018 Projection 5,221 33,787 52, Estimate 4,761 30,861 47, Census 4,321 28,157 43,723 Growth % 9.48% 9.43% Growth % 7.29% 6.87% Owner Occupied 3,923 19,615 29,466 Renter Occupied ,246 18, Avg Household Income $75,341 $60,095 $57, Med Household Income $68,752 $50,993 $46, Households by Household Inc: <$25, ,556 11,934 $25,000 - $50,000 1,120 8,551 13,727 $50,000 - $75, ,904 9,689 $75,000 - $100,000 1,069 4,621 6,419 $100,000 - $125, ,189 3,176 $125,000 - $150, ,326 $150,000 - $200, ,035 $200, Downtown Houston, Texas Houston Ship Channel 11

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