SLEEP NUMBER Freddy s Frozen Custard

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1 EPRESENTATICE ACTUAL SITE Freddy s Frozen Custard 5304 STATE ST. MURRAY, Lakewood, UT CO Offering Memorandum

2 AERIAL PHOTO STATE ST - 32,985 CPD 2

3 AERIAL PHOTO Starbucks STATE ST - 32,985 CPD 3

4 AERIAL PHOTO MURRAY HIGH SCHOOL (1,585 STUDENTS) 5300 S - 26,820 CPD N STATE ST - 32,985 CPD 4

5 AERIAL PHOTO Starbucks 5300 S - 26,820 CPD STATE ST - 32,985 CPD N 5

6 EXECUTIVE SUMMARY 5304 State St Murray, UT FINANCIAL SUMMARY Price $3,578,000 Down Payment 100% $3,578,000 Cap Rate 6.15% Building SF +/- 4,000 SF Net Cash Flow 6.15% $220,000 Year Built 2016 Lot Size.648 Acres ANNUALIZED OPERATING DATA LEASE YEARS ANNUAL RENT CAP RATE Current - 6/8/2021 $220, % 6/9/2021-6/8/2026 $242, % OPTIONS ANNUAL RENT CAP RATE Option 1 $266, % Option 2 $292, % LEASE SUMMARY Lease Type Tenant Lease Guarantor Roof & Structure Double-Net (NN) Select Comfort Retail Corporation dba Sleep Number Select Comfort Retail Corporation, a Minnesota Corporation Landlord Responsible Rent Commencement Date Janury 26, 2017 Lease Expiration Date January 31, 2027 Lease Term Remaining Rental Increases Renewal Options 10 Years 10% Increases Every 5 Years 2, 5 Year Options *Landlord shall pay property taxes, landlord insurance and all operating expenses associated with the property. Sleep Number will then reimburse for all operating expenses incurred by landlord for property taxes, insurance, maintenance, repair, replacement, operation and management thereof, to exclude capital expenditures or reserves. The Landlord has the ability to charge an administrative fee not to exceed 10% of all operating expenses. BASE RENT $220,000 Net Operating Income $220,000 Total Return 6.15% $220,000 **Tenant shall pay Landlord s estimate of all of the Operating Expenses in advance, on or before the first of each calendar month during the Term. Following the first full calendar year of the Term, Controllable Operating Expenses shall not increase by more than five percent (5%) over the amount payable by Tenant as Controllable Operating Expenses for the prior calendar year. For purposes hereof, Controllable Operating Expenses shall mean all Operating Expenses except the following (i) utilities (ii) insurance, (iii) snow & ice removal, (iv) Real Property Taxes and personal property taxes icluded in Operating Expenses, (v) security, (vi) those items not within Landlord s reasonable conrol, and (vii) administration fees. 6

7 TENANT AERIAL OVERVIEW PHOTO Starbucks Founded more than 20 years ago and based in Minneapolis, Select Comfort Corporation designs, manufactures, markets and supports a line of adjustable-firmness mattresses featuring air-chamber technology, branded the bed, as well as bases and bedding accessories. products are sold through its approximately 450 company-owned stores located across the United States; select bedding retailers; direct marketing operations; and online at At Sleep Number, they have a mission: to improve lives by individualizing sleep experiences. They start by focusing on the customer. By believing that each customer is unique and deserves sleep solutions that are just right for him or her, Sleep Number provides with products designed to help individuals sleep their very best, only from Sleep Number. Sleep Number has developed a team of Sleep Professionals who believe improving sleep improves lives. The company has created a successful business model by offering customers the option to engage whenever and however they like - online, by phone, or at one of the store locations. Headquarters Plymouth, MN Stock Symbol NASDAQ: SCSS Founded 1987 Locations 450 Website Market CAP 1.01B Website: 7

8 AERIAL PROPERTY PHOTO DESCRIPTION INVESTMENT HIGHLIGHTS New 10 Year Corporate Lease Ten Percent Rental Increases Every Five Years 2016 Build - 20 Year Roof Warranty #1 Volume Location in Utah and Companywide Corporate Guarantee from Select Comfort Retail Corporation (NASDAQ: SCSS) Excellent Signalized Hard Corner - Visible to 59,800 Cars per Day Across from Costco and Intermountain Medical Center (454 Beds) and Medical Campus 381,800+ Residents in Trade Area 162,000 Daytime Employees in a 3-Mile Radius Easily Accesible from Interstate-15 (213,700+ Cars per Day) - The Primary Connector Between Murray and Salt Lake City Two Miles from Fashion Place Mall (915,600 SF/133 Retailers), Anchored by Macy s, Nordstrom and Dillard s DEMOGRAPHICS Population 1-Mile 3-Miles 5-Miles 2020 Projection 11, , , Estimate 10, , ,882 Growth % 1.66% 1.77% LOCATION OVERVIEW The Salt Lake City metro has nearly 1.2 million people in three counties: Salt Lake, Tooele and Summit. Salt Lake City is the largest city, with 197,200 residents. The highest percentage of population growth continues to occur in the suburban areas such as South and West Jordan while the entire metro is expected to grow 1.3 percent annually over the next five years. Salt Lake City s economy will grow by 7.4 percent this year as a highly skilled and bilingual workforce and a low cost of doing business draw employers. A stable base of government entities are located in the metro, while growing companies in the private sector include technology leaders ebay and Oracle Corp. These companies, along with Twitter Inc., Goldman Sachs and the National Security Agency, have located data and service centers in the Salt Lake City metro. Tourism will remain a top employment generator over the coming years, as several world-class ski resorts, including Brighton, Park City, Alta and Snowbird, are less than an hour drive from the airport. Vail Resorts has recently taken over the operation of Park City and nearby Canyons resorts. A lift connecting the two resorts has been completed and now contains the most ski-able acres in the U.S. Also, Salt Lake City is equipped to host numerous conventions and trade shows at meeting facilities, such as the 365,000-square foot Salt Palace Convention Center and the Energy Solutions Arena. Salt Lake City s low cost of living, scenic views and wide variety of recreational and cultural activities make it a great place to live. The Wasatch Range provides a multitude of year-round recreational opportunities. The many ski resorts dotting the range offer residents world-class skiing minutes from their doorsteps. Additionally, more than a dozen national parks and monuments are all within a one-day drive of the city. Households 1-Mile 3-Miles 5-Miles 2019 Projections 4,706 57, , Estimate 4,612 56, ,268 Growth % 2.36% 2.50% Income 1-Mile 3-Miles 5-Miles 2015 Est. Average Household Income $66,913 $69,192 $75, Est. Median Household Income $51,893 $52,362 $57, Est. Per Capita Income $28,337 $28,467 $28,438 8

9 INTERIOR PHOTOS REGIONAL AERIAL PHOTO MAP Starbucks 9

10 AERIAL SITE PLAN PHOTO 5300 S 4,000 SF STATE ST N 10

11 REGIONAL AERIAL PHOTO MAP MAP Starbucks Williams-Sonoma 11

12 LOCAL AERIAL MAP PHOTO 12

13 Net Leased Disclaimer Confidentiality Agreement Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows: By accepting this Marketing Brochure, you agree to treat the information contained herein regarding the lease terms as confidential and proprietary and to only use such information to evaluate a potential purchase of this net leased property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided. As the Buyer of a net leased property, it is the Buyer s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer. Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors. Buyer and Buyer s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs. Like all real estate investments, this investment carries significant risks. Buyer and Buyer s legal and financial advisors must request and carefully review all legal and financial documents related to the property and tenant. While the tenant s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer s legal ability to make alternate use of the property. The information contained in the following offering memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and it should not be made available to any other person or entity without the written consent of Marcus & Millichap. By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property at this time, please return this offering memorandum to Marcus & Millichap. This offering memorandum has been prepared to provide summary, unverified financial and physical information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCBs or asbestos, the compliance with local, state and federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant s plans or intentions to continue its occupancy of the subject property. The information contained in this offering memorandum has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property. ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT THE MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

14 Exclusively listed by: GARY MANGUM Broker of Record SALT LAKE CITY OFFICE Tel: (801) Fax: (801) License: AB00 OFFICES NATIONWIDE