CARL S JR. 420 MERHAR AVE FAIRBANKS, AK

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1 REPRESENTATIVE PHOTO CARL S JR. 420 MERHAR AVE FAIRBANKS, AK OFFERING MEMORANDUM

2 REPRESENTATIVE PHOTO CONTENTS LISTED BY 03 EXECUTIVE SUMMARY ANDREW IVANKOVICH BRADEN CROCKETT Associate Associate VP & Director FINANCIAL OVERVIEW TENANT OVERVIEW DIR (214) MOB (626) LIC # (TX) braden.crockett@matthews.com DIR (214) MOB (714) LIC # (CA) 08 AREA OVERVIEW BROKER OF RECORD PAMELA THROOP BROKER OF RECORD LIC # RECB6332 (AK)

3 EXECUTIVE OVERVIEW INVESTMENT HIGHLIGHTS Absolute NNN Lease - Zero Landlord Responsibilities Guaranteed By CJS Of Fairbanks, LLC - Two Unit Operator Brand New 20 Year Lease to Commence At the Close of Escrow 7.50% Increases Every 5 Years - Providing a Solid Hedge Against Inflation Stellar Performance - Sales 80% Above the National Average Exceptional Retail Synergy - Major Players like Wal-Mart, Home Depot, Lowe s, and Fred Meyer Provide Carl s Jr. With Consistent Traffic Located just off Johansen Expressway (25,000 VPD) - Ideal Visibility Purchase Price Below Replacement Cost - Land and Construction Are Incredibly Expensive in Alaska Excellent Demographics Average Household Income in a 1-Mile, 3-Mile, and 5-Mile Radius all above $75,000 Income Tax-Free State CARL S JR. 3

4 FINANCIAL OVERVIEW FINANCIAL HIGHLIGHTS LIST PRICE CAP RATE TERM REMAINING $2,689, % ± 20 YEARS TENANT SUMMARY Tenant Trade Name Carl s Jr. Type of Ownership Fee Simple Guarantee CJS of Fairbanks, LLC Lease Type Absolute NNN Roof & Structure Tenant Responsibility Original Lease Term 20 Years Rent Commencement Date Close of Escrow Lease Expiration Date Close of Escrow Increases 7.50% Every 5 Years Options Three, 5-Year Options ANNUALIZED OPERATING DATA Year Proposed Rent Rent/SF Increases $2,698, $161, $45.86 $161, $161, $ $161, $ $161, $ $161, $ $174, $ % 7 $174, $ $174, $ $174, $ $174, $ $187, $ % 12 $187, $ $187, $ $187, $ $187, $ $201, $ % 17 $201, $ $201, $ $201, $ $201, $ OFFERING MEMORANDUM

5 TENANT OVERVIEW CARL S JR. Carl s Jr. is an American-based fast food restaurant chain operated by CKE Restaurants Holdings, Inc., with locations primarily in the Western and Southwestern United States. In the spirit of the company s founder, Carl Karcher, CKE believes it can best share in its success by offering support to its neighbors through its scholarship and charitable giving programs, including the Stars for Heroes campaign which raised $1 Million in CKE is also working toward greater sustainability with the help of companywide initiatives, including the corporate Green Team. STRATEGY With over 3,600 total CKE franchised and company-owned restaurants, and more than 1,500 Carl s Jr. specific, CKE Restaurants Holdings, Inc. is dedicated to helping franchisees build growing restaurant operations that are sustainable for the long term. To this end, the strategy and core positioning of the Carl s Jr. banner is oriented to building top-line sales that support franchise profitability via premium product strategy, strong restaurant fundamentals, and cutting-edge advertising. With best-in-class menus, innovative systems, and outstanding brand recognition, the company is poised for sustained growth around the world. GEOGRAPHIC OUTREACH As of March 2016, CKE has a total of 3,664 franchised or companyoperated restaurants in 44 states and 38 foreign countries and U.S. territories. Carl s Jr. has announced plans to expand in Ontario, Canada s Golden Horseshoe, a territory that includes Toronto, Mississauga, Oakville, Burlington, Hamilton, Brantford, and London. PARENT COMPANY TRADE NAME CKE RESTAURANTS HOLDINGS, INC. OWNERSHIP PRIVATE # OF LOCATIONS ± 1,500 # OF EMPLOYEES ± 23,000 HEADQUARTERED CARPINTERIA, CALIFORNIA WEBSITE YEAR FOUNDED 1941 CARL S JR. 5

6 PROPERTY OVERVIEW THE OFFERING THE PARCEL TENANT SUMMARY Property Address 420 Merhar Ave Fairbanks, AK SITE DESCRIPTION Number of Stories One Type of Ownership Fee Simple Year Built 2006 GLA ± 3,530 SF Lot Size ± 0.92 Acres (40,000 SF) Landscaping Professional Topography Generally Level Oceanside Blvd ± 31,792 College Blvd ± 40,116 6 OFFERING MEMORANDUM

7 SURROUNDING TENANTS CARL S JR. 7

8 AREA OVERVIEW FAIRBANKS, AK Alaska s second-largest city Hub of the Interior, Gateway to the Bush, the Golden Heart City Fairbanks is as diverse and distinct as any place in Alaska. Fairbanks is a home rule city and the borough seat of the Fairbanks North Star Borough in the U.S. state of Alaska. The city features a university, an Army Base, and an Air Force Base and is known for dog mushing, and northern lights. Fairbanks is home to the University of Alaska Fairbanks, the oldest of Alaska s current universities. Fairbanks is the largest city in the Interior region of Alaska estimates put the population of the city proper at 32,469, and 2016 estimates put the population of the Fairbanks North Star Borough at 100,605, making it the second most populous metropolitan area in Alaska (after Anchorage). 5-MILE DEMOGRAPHICS 49,287 POPULATION $86,443 INCOME 18,316 HOUSEHOLDS 8 OFFERING MEMORANDUM

9 ECONOMY Fairbanks is an economic hub for Interior Alaska. Through its transportation system and developed infrastructure and services, Fairbanks impacts nearby communities. Nearby Fort Wainwright and Eielson Air Force Base are both substantial influences in the region, employing more than one-third of the workforce in the area. Tourism, healthcare, oil, and mining are also prominent areas for Fairbanks s economy. QUALITY OF LIFE Not only is Fairbanks a beautiful and intriguing place to live, it also offers a competitive quality of life advantage many states can t even touch. This is a city where you can grow a business and raise a family; a place where people don t come to find themselves, but rather to create themselves. Over 20 hours of summer sunlight allows plenty of play time. Exploring the vast wilderness at our doorstep, cross-country skiing, snowmobiling and other activities, all make for world-class winter enjoyment. All this in a town where 95 percent of the people have less than a twenty-minute commute to work. CARL S JR. 9

10 ALASKA S $43 BILLION NATURAL GAS PIPELINE MEGAPROJECT Alaska Gasline Development Corp., the state of Alaska, Sinopec, China Investment Corp. and the Bank of China have signed an agreement to advance a $43 billion natural gas pipeline in Alaska. This pipeline has been a dream for Alaskans for years, seen as a way to provide economic certainty as oil production from the North Slope declines. The natural-gas pipeline is intended to tap into the rich naturalgas reserves on the North Slope. Similar in length to the oil pipeline, it would transport the gas 800 miles to the coast on the Kenai Peninsula, where it would be liquefied and shipped to Asia. Estimates have put proven gas reserves on the North Slope overall at 35 trillion cubic feet. The pipeline construction has the potential to create as many as 12,000 U.S. jobs and could possibly create a trade deficit between the United States and Asia by $10 billion each year. The pipeline would also provide China with cleaner energy. With an estimated revenue between $8 million and $10 billion each year, about 75 percent of the LNG would go to China, with Alaska retaining 25 percent (roughly $250 million) for other regional markets in Asia, including Japan, South Korea, and Vietnam. 10 OFFERING MEMORANDUM

11 EIELSON AIR FORCE BASE Eielson Air Force Base occupies 63,195 acres southeast of Fairbanks, Alaska. The runway is oriented north to south and is 14,507 feet long. It was extended to its present length in the 1950s to accommodate B-36 aircraft, and is the second longest runway in North America. POPULATION About 2,500 military people work at Eielson, which includes more than 340 Air Force Reserve and Air National Guard servicemembers. The base has approximately 930 houses and 387 dormitory rooms for the more than 2,000 military and family members who live on base. An additional 1,100 active duty, Reserve and Guard servicemembers and their families live off-base. More than 500 retirees from all branches of the military reside in the area. Rounding out the total military-related population are about 480 civilian employees. ECONOMIC IMPACT The total payroll for active duty military employees is about $132 million. The base spent more than $79 million for constuction, services and procurement of materials, equipment and supplies in fiscal year More than 1,800 jobs were created valued at approximately $41 million. CARL S JR. 11

12 CONFIDENTIALITY & DISCLAIMER STATEMENT This Offering Memorandum contains select information pertaining to the business and affairs of Carl s Jr. located at 420 Merhar Ave, Fairbanks, AK ( Property ). It has been prepared by Matthews Real Estate Investment Services. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews Real Estate Investment Services. The material is based in part upon information supplied by the Seller and in part upon financial information obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty, express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence. By acknowledging your receipt of this Offering Memorandum for the Property, you agree: 1. The Offering Memorandum and its contents are confidential; 2. You will hold it and treat it in the strictest of confidence; and 3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Seller. Owner and Matthews Real Estate Investment Services expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered. If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum. A prospective purchaser s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or Matthews Real Estate Investment Services or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property. This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum.

13 EXCLUSIVELY LISTED BY ANDREW IVANKOVICH ASSOCIATE DIR (214) MOB (626) LIC # (TX) BRADEN CROCKETT ASSOCIATE VP & DIRECTOR braden.crockett@matthews.com DIR (214) MOB (714) LIC # (CA) BROKER OF RECORD PAMELA THROOP BROKER OF RECORD LIC # RECB6332 (AK) CARL S JR. 420 MERHAR AVE FAIRBANKS, AK