CENTER FLETCHER PKWY, EL CAJON, CA OFFERING MEMORANDUM CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST

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1 OFFERING MEMORANDUM CENTER FLETCHER PKWY, EL CAJON, CA *Image has been edited for representative purposes CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST

2 Investment Advisors NRP-WEST Philip D. Voorhees Lic DEBT & STRUCTURED FINANCE Kirk Brummer Lic Sean Heitzler Lic CBRE-Newport Beach 3501 Jamboree Rd., Ste 100 Newport Beach, CA F SAN DIEGO PARTNER Reg Kobzi Lic reg.kobzi@cbre.com NRP-WEST TEAM Philip D. Voorhees Team Leader John Read Kirk Brummer Matt Burson James Tyrrell Preston Fetrow Jimmy Slusher Megan Wood Sean Heitzler Scott Peterson Lic scott.peterson@cbre.com 2017 CBRE, Inc. All Rights Reserved. For all of our available listings, please visit:

3 Table Of Contents 1 INVESTMENT OVERVIEW 3 AREA OVERVIEW 7 PROPERTY OVERVIEW 9 TENANT SUMMARY 11 FINANCIALS Investment Summary Investment Highlights City Overview County Overview Property Description Parcel Map Site Plan Tenant Profiles Assumptions Cash Flow Rent Roll

4 SAN DIEGO SAN CARLOS GOLF COURSE SAN CARLOS Found out from website pdf Recreate PMS LAKE MURRAY 7,000 CPD) SR-125 FREEWAY (±8 CENTER E LD AV GARFIE FL ET CH ER PK W FLETCHER HILLS TOWN & COUNTRY SHOPPING CENTER STARBUCKS COFFEE NAVAJO SHOPPING CENTER Y (± 29,10 0C PD )

5 MIRAMAR N CARLTON OAKS COUNTRY CLUB GROSSMONT COLLEGE (8,095 STUDENTS) EL CAJON San Diego County Estimated 2017 Demographics POPULATION ON CKT BRO ST HOUSEHOLDS 3,328,647 1,161,476 AVG HOUSEHOLD INCOME AVG HOUSING VALUE $96,336 $581,436 *Source: CBRE Location Analytics & Mapping, 2017

6 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Investment Summary OFFERING PRICE: $8,100,000 NOI (YEAR 1): $483,250 CAP RATE (YEAR 1): 5.97% NOI (YEAR 3): $533,720 CAP RATE (YEAR 3): 6.54% PRICE PSF: $220 CURRENT OCCUPANCY: 98% TOTAL BUILDING AREA: TOTAL LAND AREA: WEBSITE: ±36,750 SF ±124,581 SF (±2.86 Acres) Investment Highlights Discount Retailer, Food and Service Oriented Community Center in Affluent San Diego County Submarket San Diego Community Center The acquisition of Fletcher Hills Center offers an investor an opportunity to purchase a wholly-owned 99 Cents Only-anchored shopping center within the affluent city of El Cajon *Image has been edited for representative purposes Low Tenant Occupancy Costs Low rents at Fletcher Hills Center produce low costs of occupancy, providing stability for tenants, increasing renewal probability and the prospects for long-term tenant occupancy 1

7 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST Investment Highlights (continued) Cash Flow Stability and Growth Improving Returns Due to embedded increases and below market leases rolling to market, the Net Operating Income is projected to increase more than $180,000 (37%) over the expected hold period, providing an inflation hedge High Occupancy Asset Strong historical occupancy with current occupancy of 98% demonstrates recession resistance and high tenant demand Leasing Activity 99 Cent Only just exercised its 5 year option, and Lifelong Yoga, Coldwell Banker and Best Team Consulting are on brand new leases Strong Real Estate Fundamentals Below Market Lease Rates Virtually the entire center is leased at rental rates significantly below the prevailing rates. Property-wide, CBRE estimates current lease rates to be 13% below market Below Replacement Cost Opportunity At the list price, the property will trade well below its land-inclusive replacement cost estimated to be ±$310 PSF Ease of Circulation Convenient, accessible parking field creates a meaningful amenity for customers throughout the day High Identity, High Traffic Location Commuter Route Frontage Property boasts more than 620 feet of frontage along major east/west commuter route, Fletcher Parkway Hard Corner, Signalized Location Fletcher Hills Center is located at the signalized hard corner of Fletcher Parkway and Garfield Avenue, providing exceptional access and visibility Residential and Commercial Proximity Proximity to both residential and commercial density keeps the property busy during throughout the day, all days of the week Internet Resistant Tenancy Synergistic Tenant Roster Desirable, existing tenant mix coupled with a first-tier value-oriented anchor generates high frequency foot traffic Internet Resistant Tenancy Virtually all of the tenants at Fletcher Hills Shopping Center provide extreme value, convenience, food & beverage, services and/or experiences that are not conducive to internet transactions, thereby providing fortification against internet competition Affluent San Diego County Demographics More than 15,400 people in a 1-mile radius with an Average Household Income exceeding $99,100 More than 151,800 people in a 3-mile radius with an Average Household Income exceeding $76,00 More than 367,200 people in a 5-mile radius with an Average Household Income exceeding $81,000 Ideal 1031 Exchange Property No Existing Financing/Debt Free Fletcher Hills Center will be marketed free and clear of existing financing, providing a potential purchaser an opportunity to customize debt to achieve optimal returns Pride of Ownership Asset Meticulously maintained, 36,750 SF shopping center, anchored by 99 Cents Only»» The entire 2nd story office was completely renovated recently, leading immediately to the property s 98% occupancy Strong Inflation Hedge Scheduled rental increases and below market rents rolling to market produce massive NOI growth, enhancing future cash on cash returns and providing a strong hedge against inflation with a tangible, dependable asset High Traffic Location Strong traffic counts of approximately 31,000 cars per day with convenient ingress/egress, complemented by ample parking make the property a customer favorite in the trade area 2

8 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON El Cajon, CA As the 5th largest city in San Diego County, El Cajon boasts a culturally diverse and vibrant community. Located in the southwest region of San Diego County, El Cajon is home more than 105,000 residents. The city is located just 20 miles from the bustling San Diego metropolis and has acted as an agricultural heartland and communications center of San Diego County. El Cajon has a dynamic business environment and is home to both global and nationally known corporations such as Taylor Guitars, one of the premier guitar manufacturing companies in the world. Additionally, El Cajon has a wonderful downtown with shops and restaurants that the entire family can enjoy. Gillespie Field, the oldest and largest of the county s eight airports, is located in El Cajon. In addition to the airport itself, Gillespie Field includes two business parks that provide more than 3,000 jobs in the city of El Cajon and a $110 million boost to the local economy in direct, indirect and induced revenues. Future Developments Include:»» Hotel Developments Hampton Inn by Hilton: In late 2018 or early 2019, El Cajon will be home to Hampton Inn by Hilton, located on Fletcher Parkway across from Parkway Plaza. At the same site, the developers are planning Fletcher Marketplace, consisting of three commercial buildings, including an In-N-Out Burger. Courtyard by Marriott Hotel: El Cajon s first major hotel development in decades will open its doors for business this fall. The hotel is located at the corner of Magnolia and Rea Avenue, just north of Main Street in the heart of downtown El Cajon. The development of East San Diego County s first true four-star hotel marks an economic turning point for the city of El Cajon. The new 120-room Courtyard by Marriott will feature a swimming pool, outdoor dining, a business center and meeting rooms. The development also includes two new commercial storefronts along Magnolia Avenue and is expected to draw additional business investment to the area DEMOGRAPHICS 2017 Population - Current Year Estimate 105, Population - Five Year Projection 109, Median Age Households - Current Year Estimate 35, Households - Five Year Projection 37, Average Household Income $68, Average Household Income $76, Owner Occupied Housing Units 14, Average Value of Owner Occ. Housing Units $437,655 *Source: CBRE Location Analytics & Mapping, 2017 TOP EMPLOYERS BY SALES Ajm Packaging Corp $404.4M Mouser Electronic Inc $354.3M Chem-Tronics Inc $171.4M Toyota Of El Cajon $151.4M El Cajon Ford $125M El Cajon Colleges»» Other Development Cornerstone Place is a four-story development at 230 South Sunshine Avenue that will provide both living and office space. This project will include 70 multi-family one and three-bedroom units, outdoor spaces, a community room and numerous resident amenities. Construction of Cornerstone is expected to be completed in January of Source: GROSSMONT COMMUNITY COLLEGE 8,095 STUDENTS SAN DIEGO CHRISTIAN COLLEGE 916 STUDENTS CUYAMACA COLLEGE 8,470 STUDENTS SOUTHERN CALIFORNIA SEMINARY 235 STUDENTS 3

9 15 r CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST Cardiff 5 Solana Beach Del Mar Torrey Pines Tuxedo Rd La Jolla Pacific Beach 8 Ocean Beach University City Mission Bay Navajo Rd Point Loma Park Ridge Blvd Rancho Santa Fe Fairbanks Ranch Mission Gorge Rd Carmel Valley Rowena St 52 San Diego International Airport Coronado Murray Park Dr Golfcrest Dr Colorado Ave 10-MILE 4S Ranch Black Mountain Ranch Carmel Mountain Ranch Rancho Penasquitos Mira Mesa Miramar San Diego Mohawk St El Cajon Blvd Volclay Dr Melotte St San Diego Bay National City Scripps Ranch Imperial Beach Lake Murray Kiowa Dr 52 Jackson Dr 805 Chula Vista Mission Trails Regional Park 94 Lake Shore Dr Kumeyaay Hwy Poway 3-MILE 8 54 Bonita Rancho Del Rey 805 San Ysidro Spring Valley Bostonia El Cajon Mission La Presa Trails Golf Course Otay Ranch 11 Lakeside 94 Blue Lake Dr Distance from Fletcher Hills Center SAN DIEGO: 20 MILES El Paso St Baltimore Dr Fernbrook Wing Span Dr 54 8 Crest Jamul Otay County Open Space Preserve Mission Trails MEXICO BORDER: 32 MILES Regional Park ORANGE COUNTY: 92 MILES Lake Murray LOS ANGELES: 184 MILES REGIONAL MAP 5-MILE Aztec Dr PHOENIX: 340 MILES Lake Andrita Ave N San Carlos Dr Marengo Ave El Cajon Blvd Cowles Mountain Blvd Heidi St Dugan Ave Fletcher Pkwy La Mesa Barker Way Whelan Dr Navajo Rd Boulder Lake Ave Jackson Dr Yorkshire Ave Jackie Dr Highwood Dr 1-MILE Lake Murray Blvd Lake Angela Dr Dallas St Grossmont Center Center Dr 125 La Mesita Park Fletcher Pkwy Fanita Dr Murray Dr Amaya Dr Severin Dr Lemon Ave Valley Lake Dr Windmill View Rd Garfield Ave Falmouth Dr Gregory St Fuerte Dr 8 CENTER Hacienda Dr N Westwind Dr Henderson D Water St Aldwych Rd Primrose Dr Harry Griffen Regional Park Grossmont Murray Dr Swallow Dr Finch St Eastside Rd Pandora Dr Lemon Ave Cuyamaca St S Travelodge Dr Mt Helix Cuyamaca St Pine Dr Fuerte Dr Fesler St 8 N Marshall Ave El Cajon Blvd W Main St S Marshall Ave S Lemon Ave W Bradley Ave N Johnson Ave Pioneer Way W Washington Ave W Renette Ave 8 LOCAL MAP S Sunshine Ave S Orange Ave Magnolia Ave Broadwa Magnolia Ave S Magnolia Ave El Cajon Alzeda Dr N B 4

10 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON San Diego County San Diego County s nearly perfect year-around weather combined with a dynamic economy make the region one of the most desirable places to live and work in the United States. San Diego s quality of life and burgeoning economy attract residents, businesses and visitors from around the world. Over the last two decades, the San Diego region has developed its own progressive identity as a premier tourist destination as well as a leader in defense development, biotechnology, sustainable energy, wireless and telecommunications technologies, and electronics manufacturing. San Diego County encompasses 4,526 square miles, with approximately 3.2 million people with a projected growth of 3.4 million by San Diego County is the second largest county in the state and the fifth largest county in the country Over the past five years, regional access has increased dramatically with several improvements including the creation of the I-15 Reversible Lane Control System, a system that switches the direction of traffic in several lanes from the morning commute to the afternoon rush hour to accommodate the daily changes in the north/south flow of traffic on I-15 The Port of San Diego is comprised of 3,415 acres of land and 3,402 acres of water located within the cities of San Diego, National City, Chula Vista, Imperial Beach and Coronado. With 63,000 jobs located at the port tidelands, the Port of San Diego created a direct economic impact of $8.3 billion DEMOGRAPHICS 2017 Estimated Population 3,328, Projected Population 3,487, Median Age Estimated Households 1,161, Projected Households 1,214, Est. Average Household Income $96, Est. Average Household Income $109, Est. Average Housing Value $581,436 *Source: CBRE Location Analytics & Mapping, 2017 Top Retail Attractions Fashion Valley Mall Seaport Village Horton Plaza Little Italy Gaslamp Quarter La Jolla Carlsbad Premium Outlts Unlike markets such as Las Vegas and Phoenix, San Diego is land-constrained resulting in a limited availability of developable land. This land shortage raises high entry barriers for new real estate development but also creates a premium for land values. The County s general purpose revenue (GPR) is projected to increase by 4.4%, with budgeted GPR of $1,133.7 million in fiscal year 2017 compared to $1,086.2 million budgeted in fiscal year San Diego s economic output accounts for more than 8% of California s Gross State Product (GSP) and 1% of the national Gross Domestic Product. San Diego remains the nation s 17th largest metro economy, with a higher GDP than most foreign nations. Source: San Diego 2016 Economic Outlook San Diego tourists contributed nearly $16 billion to San Diego County s economy in 2016, a 2.6% increase from the previous year. Over the course of the last 22 years, San Diego County s average annual increase in travel spending, 4.6 %, outranks all other regions in the state. Source: California Travel Impacts by County, May 2017 For more information visit: Top Tourist Attractions Balboa Park SeaWorld San Diego Zoo Old Town State Historic Park Point Loma and Cabrillo National Monument San Diego Museum of Art Midway Aircraft Carrier Museum 5

11 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST CENTER N BROCKTON ST GARFIELD AVE FLETCHER PKWY (±29,100 CPD) 6

12 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Property Overview Location Fletcher Parkway El Cajon, CA Site Fletcher Hills Center is located at the NE corner of Fletcher Pkwy and Garfield Ave in the city of El Cajon, CA. Land Area Fletcher Hills Center consists of 1 parcel (APN: ) totaling approximately ±2.86 acres or ±124,581 of land area. Building Area The subject consists of 3 retail buildings totaling approximately ±36,750 SF of net rentable area. Frontage & Access The site benefits from approximately ±571 linear feet of frontage along Fletcher Pkwy, approximately ±214 linear feet of frontage along Garfield Ave, approximately ±620 linear feet of frontage along Needham Rd, and approximately ±219 liner feet of frontage along Brockton St. Access points into the center include 2 entrances off Fletcher Pkwy and, 2 entrances off Garfield Ave, and 2 entrances off Brockton St. Parking Fletcher Hills Center provides ±192 parking stalls, which equates to ±5.22 spaces per 1,000 SF parking ratio. Traffic Counts Fletcher Pkwy... ±29,100 CPD Garfield Ave...±1,900 CPD Hwy ±87,000 CPD Built Fletcher Hills Center was built in 1959 with a recent remodel completed in Parcel Map Zoning Per the city of El Cajon the subject site is currently zoned as C Shopping Center. 7

13 GARFIELD AVE CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST SITE PLAN DN LOBBY DN Tenant Roster SUITE TENANT SF CONFERENCE RVCV Enterprises Whole Bodied Consulting BVM Design Inc., 409 NEEDHAM RD 125 David Berman Jack Mann and Susan 596 UP UP 145 Deborah Sampley, D.C AVAILABLE (150) Lauri Croce BROCKTON ST 160 Advanced Radar Techn PlayOn! Sports Cent Only Store 15, Fletcher Hills Alterations Dick & Jane Waxing Salon 1,000 FLETCHER PKWY N 2352 Delux Nails & Spa 1, Martial Arts 1, Awards by Navajo 1, Lifelong Yoga 1, Best Team Consulting Group 1, New Tenant Coldwell Banker 3, The Barbecue Pit 3, Baskin Robbins 856 Available SF 592 Total SF 36,750 8

14 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Tenant Profiles 99 Cents Only Founded in 1982, 99 Cents Only Stores LLC is the leading operator of extreme value stores in California and the Southwestern United States. The Company currently operates 390 stores located in California, Texas, Arizona and Nevada. 99 Cents Only Stores LLC offers a broad assortment of name brand and other attractively priced merchandise and compelling seasonal product offerings. OWNERSHIP Private LOCATIONS 394 EMPLOYEES 11,500 HEADQUARTERS Commerce, CA Baskin Robbins Baskin-Robbins, the world s largest chain of ice cream specialty shops, is named the top ice cream and frozen dessert franchise in the United States by Entrepreneur magazine s 36th annual Franchise 500 ranking in OWNERSHIP Nasdaq: DNKN REVENUE $811 million MARKET CAPITALIZATION $4 billion LOCATIONS 7,600+ HEADQUARTERS Canton, MA Coldwell Banker Since 1906, the Coldwell Banker organization has been a premier provider of full-service residential and commercial real estate brokerage services. Coldwell Banker Real Estate is the oldest national real estate brand and franchisor in the United States, and today has a global network of 3,000 independently owned and operated franchised broker offices in 49 countries and territories with more than 88,000 affiliated sales professionals. OWNERSHIP Private LOCATIONS 3,000 EMPLOYEES 88,000 HEADQUARTERS Madison, NJ 9

15 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST 10

16 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Assumptions GLOBAL AVAILABLE SPACE LEASING MARKET LOAN Analysis Period Occupancy and Absorption Loan Funding (as of Feb-18) $4,860,000 Commencement Date February 1, 2018 Projected Available at 2/1/ SF Loan-To-Price 60.00% End Date January 31, 2028 Currently Available as of 11/1/ SF Funding Date Feb-18 Term 10 Years Percentage Available at 11/1/ % Maturity Date Jan-28 Absorption Period 12 Month(s) Loan Term 10.0 Years Area Measures Absorption Period Start Date February 1, 2018 Amortization Period 30 Years Building Square Feet (SF) 36,750 SF First Absorption Occurs On February 1, 2019 Initial Interest Only Period (If Any) 24 Months Last Absorption Occurs On February 1, 2019 Interest Rate 4.50% Growth Rates Origination Fee on Initial Loan Funding 1.00% Consumer Price Index (CPI) 3.00% Financial Terms Office Other Income Growth Rate 3.00% 2018 Monthly Market Rent $1.95 PSF FINANCING Operating Expenses 3.00% Rent Adjustment Flat Real Estate Taxes 2.00% Lease Term 3 Years Market Rent Growth Expense Reimbursement Type GROSS [3] CY % Rent Abatements 0 Month(s) CY % Tenant Improvements ($/SF) $20.00 PSF CY % Commissions 6.00% CY % **Available Space Tenant Improvements include an additional $10 PSF CY % COSTS TO STABILIZE CY % EXPENSES Misc CapEx 50,000 CY % Operating Expense Source 2017 Budget [4] Tenant Improvements 11,840 CY % Management Fee (% of EGR) 3.00% Leasing Commissions 2,568 CY % Real Estate Taxes Reassessed Yes [5] Total Costs to Stabilize $64,408 CY % Millage Rate % General Vacancy Loss 5.00% [1] MISCELLANEOUS REVENUE Special Assessments $101 Capital Reserves (CY 2018 Value) $0.25 PSF [2] Signage Income $1,549 /yr [6] Percentage Rent $13,646 /yr [7] You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. For customized Debt Quotations, please contact: Scott Peterson Lic scott.peterson@cbre.com CBRE Debt & Equity Finance (DEF) is a division of CBRE Inc. In the US, DEF represents approximately 300 lenders including: banks, life insurance companies, pension funds, CMBS lenders and a variety of other lending sources. DEF also acts as a correspondent for over 200 life insurance companies. The Quote above is an approximation of available terms. All market rent rates are stated on calendar-year basis. [1] General Vacancy Loss factor includes losses attributable to projected lease-up, rollover downtime, and fixturing downtime. The following tenants are excluded from this loss factor for current and option terms only: 99 Cent Only Store and Baskin Robbins. [2] Capital Reserves do not inflate during the term of the analysis. [3] Future retail tenants are assumed to reimburse their pro rata share of all expenses, including Management Fee. [4] Operating Expenses are based on the 2017 Budget inflated 3% for the initial year of the analysis, less any owner-specific expenses. [5] Real Estate Taxes have been reassessed at the estimated purchase price based on a millage rate of % plus special assessments of $101. [6] Signage income is assumed to remain in-place, growing with general inflation, for the duration of the analysis. [7] Percentage rent is paid by Baskin Robbins. Analysis assumes Baskin Robbins renews for 3 years with percentage rent continuing under current terms. See Argus file for details. 11

17 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST Assumptions (continued) SECOND GENERATION LEASING Anchor Shops Office Retention Ratio 75% 75% 75% Financial Terms 2018 Monthly Market Rent $1.10 PSF See Rent Roll See Rent Roll Rent Adjustment 10% Every 5 Years 3.00% Annually Flat Lease Term 10 Years 5 Years 3 Years Expense Reimbursement Type NNN NNN GROSS [3] Tenanting Costs Rent Abatements [8] New 3 Month(s) 3 Month(s) 0 Month(s) Renewal 0 Month(s) 0 Month(s) 0 Month(s) Weighted Average 0.75 Month(s) 0.75 Month(s) 0.00 Month(s) Tenant Improvements ($/SF) New $20.00 PSF $15.00 PSF $10.00 PSF Renewal $4.00 PSF $3.00 PSF $0.00 PSF Weighted Average $8.00 PSF $6.00 PSF $2.50 PSF Commissions [9] New 6.00% 6.00% 6.00% Renewal 3.00% 3.00% 3.00% Weighted Average 3.75% 3.75% 3.75% Downtime New 9 Month(s) 6 Month(s) 6 Month(s) Weighted Average 2 Month(s) 2 Month(s) 2 Month(s) [8] Rent Abatement includes NNN charges as well as base rent. [9] Leasing Commissions are calculated by applying 100% of the rates shown above for lease years 1-5, and 50% of the above rates for lease years 6 and beyond. You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 12

18 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Cash Flow FISCAL YEAR 2/18-1/19 2/19-1/20 2/20-1/21 2/21-1/22 2/22-1/23 2/23-1/24 2/24-1/25 2/25-1/26 2/26-1/27 2/27-1/28 2/28-1/29 Physical Occupancy 98.04% 96.01% 98.56% 99.17% 98.01% 98.74% 95.26% 97.29% 99.17% 99.36% 97.39% [1] Overall Economic Occupancy 96.92% 95.00% 96.42% 96.44% 96.28% 96.21% 94.12% 96.12% 96.26% 96.26% 96.21% Total Operating Expenses PSF Per Year $6.74 $6.93 $7.12 $7.30 $7.48 $7.70 $7.86 $8.08 $8.29 $8.51 $8.85 [2] FY 2019 REVENUES $/SF/MO Scheduled Base Rent Gross Potential Rent $1.34 $591,345 $642,336 $667,658 $685,471 $706,509 $750,147 $752,512 $768,814 $785,969 $800,131 $853,178 Absorption & Turnover Vacancy (0.04) (16,929) (32,051) (12,964) (8,899) (19,119) (12,333) (38,452) (28,420) (10,234) (7,039) (29,960) Base Rent Abatements (7,818) (3,024) (1,754) (1,604) (2,974) (13,374) (3,558) (2,094) (1,859) (3,447) Total Scheduled Base Rent , , , , , , , , , , ,771 Expense Reimbursements , , , , , , , , , , ,460 Retail Sales Percent Revenue ,646 14,697 15,839 9, Signage Income ,549 1,595 1,643 1,692 1,743 1,796 1,849 1,905 1,962 2,021 2,082 TOTAL GROSS REVENUE , , , , , , , , , , ,313 General Vacancy Loss (0.01) (6,277) 0 (13,444) (19,275) (11,077) (18,814) 0 (3,883) (23,244) (27,299) (5,375) EFFECTIVE GROSS REVENUE , , , , , , , , , , ,938 OPERATING EXPENSES Janitorial (0.06) (27,494) (28,321) (29,170) (30,045) (30,946) (31,875) (32,832) (33,816) (34,830) (35,876) (36,952) Utilities (0.11) (47,541) (48,968) (50,437) (51,949) (53,508) (55,114) (56,767) (58,470) (60,224) (62,031) (63,892) Repairs & Maintenance (0.06) (26,382) (27,171) (27,984) (28,824) (29,688) (30,578) (31,499) (32,444) (33,415) (34,416) (35,452) Security (0.02) (7,423) (7,645) (7,875) (8,111) (8,354) (8,605) (8,863) (9,129) (9,403) (9,685) (9,975) Landscaping (0.02) (6,645) (6,844) (7,050) (7,260) (7,479) (7,703) (7,934) (8,172) (8,417) (8,670) (8,930) Parking Lot (0.01) (5,749) (5,922) (6,099) (6,282) (6,471) (6,665) (6,865) (7,071) (7,283) (7,502) (7,727) Management Fee (0.05) (21,934) (22,964) (23,861) (24,360) (24,739) (26,062) (25,303) (26,788) (27,492) (28,018) (29,668) Insurance (0.02) (8,532) (8,788) (9,052) (9,323) (9,603) (9,891) (10,188) (10,494) (10,808) (11,133) (11,467) Real Estate Taxes (0.21) (93,173) (95,035) (96,934) (98,870) (100,846) (102,860) (104,916) (107,012) (109,150) (111,331) (117,224) Repairs & Maintenance (NR) (0.01) (2,994) (3,084) (3,177) (3,272) (3,370) (3,471) (3,576) (3,683) (3,793) (3,907) (4,024) TOTAL OPERATING EXPENSES (0.56) (247,867) (254,742) (261,639) (268,296) (275,004) (282,824) (288,743) (297,079) (304,815) (312,569) (325,311) NET OPERATING INCOME , , , , , , , , , , ,627 You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 13

19 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST Cash Flow (continued) FISCAL YEAR 2/18-1/19 2/19-1/20 2/20-1/21 2/21-1/22 2/22-1/23 2/23-1/24 2/24-1/25 2/25-1/26 2/26-1/27 2/27-1/28 2/28-1/29 CAPITAL COSTS Tenant Improvements (0.00) (1,950) (56,102) (15,313) (7,770) (17,421) (15,344) (71,789) (27,813) (9,786) (9,163) (27,117) Leasing Commissions (0.00) (2,053) (34,740) (12,238) (7,794) (16,282) (12,332) (43,382) (24,712) (9,840) (7,258) (24,123) Capital Reserves (0.02) (9,188) (9,188) (9,188) (9,188) (9,188) (9,188) (9,188) (9,188) (9,188) (9,188) (9,188) Misc CapEx (0.11) (50,000) TOTAL CAPITAL COSTS (0.14) (63,191) (100,030) (36,739) (24,752) (42,891) (36,864) (124,359) (61,713) (28,814) (25,609) (60,428) OPERATING CASH FLOW $0.95 $420,059 $410,692 $496,981 $518,938 $506,730 $549,037 $430,341 $534,134 $582,771 $595,757 $603,199 ACQUISITION & RESIDUAL SALE Purchase Price ($8,100,000) Tenant Improvements (11,840) 0 11, Leasing Commissions (2,568) 0 2, Misc CapEx (50,000) 50, All Cash Net Residual Value [3] ,801,260 IRR CASH FLOW BEFORE DEBT ($8,164,408) $470,059 $425,100 $496,981 $518,938 $506,730 $549,037 $430,341 $534,134 $582,771 $10,397, % [4] MARKET LOAN Loan Funding / Payoff 4,860, (4,122,108) Loan Fees (48,600) Leveraged Annual Debt Service 0 (218,700) (218,700) (295,499) (295,499) (295,499) (295,499) (295,499) (295,499) (295,499) (295,499) IRR CASH FLOW AFTER DEBT ($3,353,008) $251,359 $206,400 $201,482 $223,439 $211,231 $253,538 $134,842 $238,635 $287,272 $5,979, % NOI Return 5.92% 6.26% 6.54% 6.66% 6.73% 7.18% 6.79% 7.30% 7.49% 7.61% UNLEVERAGED Cash Return 5.76% 5.21% 6.09% 6.36% 6.21% 6.72% 5.27% 6.54% 7.14% 7.30% LEVERAGED Cash Return [5] 7.89% 8.71% 7.10% 7.40% 7.58% 8.66% 7.73% 8.96% 9.43% 9.72% Rolling - All Cash IRR N/M 3.79% 5.16% 5.70% 6.94% 6.07% 6.83% 7.02% 7.11% 7.58% Rolling - Leveraged IRR N/M 1.95% 5.60% 7.04% 9.92% 7.98% 9.64% 9.99% 10.11% 10.93% [1] This figure takes into account vacancy/credit loss, absorption vacancy, turnover vacancy, and base rent abatements. [2] Based on 36,750 square feet. [3] Net Residual Value is calculated by dividing Year 11 NOI by the Residual Cap Rate of 6.50% and applying a 4.00% Cost of Sale. [4] Market Debt based on 60% Loan-to-Value, 4.50% Interest Rate, 30-Year Amortization, 24 Months Interest Only and 1.00% Loan Fee. [5] Leveraged Cash Return is based on NOI less debt service divided by equity including costs to stabilize. You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 14

20 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Rent Roll SUITE TENANT NAME SQUARE FEET % OF PROPERTY LEASE TERM RENTAL RATES BEGIN END BEGIN MONTHLY PSF ANNUALLY PSF RECOVERY TYPE MARKET ASSUMPTION / MARKET RENT 110 RVCV Enterprises % Feb-2015 Jan-2020 Current $1,311 $1.35 $15,732 $16.15 GROSS Market Lease expired 1/17. Assumes tenant renews as analysis start for two (2) years at the modeled terms. Feb-2019 $1,356 $1.39 $16,276 $16.71 $1.95 GROSS (Office) 115 Whole Bodied % Jul-2017 Jun-2019 Current $799 $1.95 $9,588 $23.39 GROSS Market Consulting Jul-2018 $823 $2.01 $9,877 $24.09 $1.95 GROSS (Office) Tenant has one (1) - one (1) year option at FMV. 120 BVM Design Inc., % Jan-2016 Dec-2020 Current $725 $1.77 $8,700 $21.27 GROSS Market Jan-2019 $750 $1.83 $8,998 $22.00 $1.95 GROSS (Office) Jan-2020 $775 $1.90 $9,301 $22.74 Lease expires 12/17. Assumes tenant renews as of lease expiration for three (3) years at the modeled terms. 125 David Berman % Mar-2016 Jan-2019 Current $650 $1.62 $7,800 $19.40 GROSS Market MTM $1.95 GROSS (Office) Lease expires 2/18. Assumes tenant remains in-place throughout first year of analysis at same terms. 130 Jack Mann and % Apr-2015 Mar-2019 Current $825 $1.38 $9,900 $16.61 GROSS Market Susan Apr-2018 $850 $1.43 $10,198 $17.11 $1.95 GROSS (Office) 145 Deborah Sampley, % Sep-2015 Aug-2018 Current $705 $1.91 $8,460 $22.86 GROSS Market D.C $1.95 GROSS (Office) Tenant has one (1) - one (1) year option at FMV. You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 15

21 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST Rent Roll (continued) SUITE TENANT NAME SQUARE FEET % OF PROPERTY LEASE TERM RENTAL RATES BEGIN END BEGIN MONTHLY PSF ANNUALLY PSF RECOVERY TYPE MARKET ASSUMPTION / MARKET RENT 150 AVAILABLE (150) % Feb-2019 Jan-2022 Feb-2019 $1,189 $2.01 $14,268 $24.10 GROSS Market $1.95 GROSS (Office) 155 Lauri Croce % Oct-2015 Sep-2018 Current $705 $1.72 $8,460 $20.63 GROSS Market $1.95 GROSS (Office) 160 Advanced Radar % Feb-2016 Jan-2019 Current $680 $1.66 $8,160 $19.90 GROSS Market Techn MTM $1.95 GROSS (Office) Lease expires 1/18. Assumes tenant remains in-place throughout first year of analysis at same terms. 165 PlayOn! Sports % Oct-2015 Jan-2019 Current $1,250 $1.29 $15,000 $15.45 GROSS Market $1.95 GROSS (Office) Lease expired 9/16. Assumes tenant renews as of analysis start for one (1) year at the modeled terms Cent Only Store 15, % Jul-2008 Jan-2023 Current $17,283 $1.10 $207,397 $13.21 NNN (No Mgmt)+5% Option Admin(Cap)P13 $1.10 NNN (Anchor) Tenant has a 3% cap on prior year s CAM (modeled). Tenant has two (2) - five (5) year options remaining at $14.80 & $17.02 /sf/yr, respectively (modeled below). Tenant has prop 13 protection on more than one (1) sale every ten (10) years (modeled). Feb-2023 Jan-2033 FUTURE $19,363 $1.23 $232,360 $14.80 NNN (No Mgmt)+5% Market OPTION Feb-2028 $22,268 $1.42 $267,214 $17.02 Admin(Cap)P13 $1.10 NNN (Anchor) Assumes tenant exercises two (2) - five (5) year options with no leasing costs. You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 16

22 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Rent Roll (continued) SUITE TENANT NAME SQUARE FEET % OF PROPERTY LEASE TERM RENTAL RATES BEGIN END BEGIN MONTHLY PSF ANNUALLY PSF RECOVERY TYPE MARKET ASSUMPTION / MARKET RENT 2344 Fletcher Hills % Dec-2008 Jan-2019 Current $960 $1.20 $11,520 $14.40 NNN Market Alterations MTM $1.90 NNN (Shops) Lease is currently MTM. Assumes tenant remains in-place throughout first year of analysis at same terms Dick & Jane Waxing 1, % Sep-2015 Aug-2020 Current $1,538 $1.54 $18,460 $18.46 NNN Market Salon Sep-2018 $1,584 $1.58 $19,010 $19.01 $1.90 NNN (Shops) Sep-2019 $1,632 $1.63 $19,580 $19.58 Tenant has one (1) - five (5) year option at FMV Delux Nails & Spa 1, % Jan-2006 Jan-2019 Current $1,200 $1.20 $14,400 $14.40 NNN Market MTM $1.90 NNN (Shops) Lease is currently MTM. Assumes tenant remains in-place throughout first year of analysis at same terms Martial Arts 1, % Jun-2015 May-2020 Current $1,326 $1.33 $15,914 $15.91 NNN Market Jun-2018 $1,366 $1.37 $16,390 $16.39 $1.90 NNN (Shops) Jun-2019 $1,407 $1.41 $16,880 $16.88 Tenant has one (1) - five (5) year option at the greater of FMV or 103% of prior rent Awards by Navajo 1, % Jan-2004 Jan-2019 Current $1,200 $1.20 $14,400 $14.40 GROSS Market MTM $1.90 NNN (Shops) Lease is currently MTM. Assumes tenant remains in-place throughout first year of analysis at same terms. You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 17

23 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST Rent Roll (continued) SUITE TENANT NAME SQUARE FEET % OF PROPERTY LEASE TERM RENTAL RATES BEGIN END BEGIN MONTHLY PSF ANNUALLY PSF RECOVERY TYPE MARKET ASSUMPTION / MARKET RENT 2364 Lifelong Yoga 1, % Feb-2018 Jan-2023 Current $1,900 $1.90 $22,800 $22.80 NNN Market Feb-2020 $1,957 $1.96 $23,480 $23.48 $1.90 NNN (Shops) Feb-2021 $2,016 $2.02 $24,190 $24.19 Assumes tenant is in-place as of analysis start. Seller to credit any downtime, leasing costs and free rent. Tenant has one (1) - five (5) year option at FMV, not less than 103% of prior, with 3% annual increases thereafter Best Team 1, % Jun-2017 Jul-2022 Current $1,900 $1.90 $22,800 $22.80 NNN Market Consulting Group Jun-2019 $1,957 $1.96 $23,480 $23.48 $1.90 NNN (Shops) Jun-2020 $2,016 $2.02 $24,190 $24.19 Jun-2021 $2,076 $2.08 $24,910 $24.91 Tenant has one (1) - five (5) year option at the greater of FMV or 103% of prior rent AVAILABLE (2372) % Feb-2018 Jan-2023 Current $1,520 $1.90 $18,240 $22.80 NNN Market ASSUMED $1.90 NNN (Shops) 2382 Coldwell Banker 3, % Mar-2017 Feb-2024 Current $3,812 $0.99 $45,738 $11.88 NNN Market Mar-2018 $4,813 $1.25 $57,750 $15.00 $1.25 NNN (Shops) Mar-2019 $5,198 $1.35 $62,370 $16.20 Mar-2020 $5,583 $1.45 $66,990 $17.40 Mar-2021 $5,862 $1.52 $70,340 $18.27 Mar-2022 $6,154 $1.60 $73,843 $19.18 Mar-2023 $6,462 $1.68 $77,539 $20.14 Tenant has one (1) - seven (7) year option at FMV. You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 18

24 FLETCHER HILLS CENTER FLETCHER PKWY, EL CAJON Rent Roll (continued) SUITE TENANT NAME SQUARE FEET % OF PROPERTY LEASE TERM RENTAL RATES BEGIN END BEGIN MONTHLY PSF ANNUALLY PSF RECOVERY TYPE MARKET ASSUMPTION / MARKET RENT 2388 The Barbecue Pit 3, % Jan-1988 Feb-2019 Current $4,736 $1.48 $56,832 $17.76 NNN Market Mar-2018 $4,864 $1.52 $58,368 $18.24 $1.50 NNN (Shops) 2396 Baskin Robbins % Mar-2000 Aug-2018 Current $1,889 $2.21 $22,663 $26.48 NNN Option Mar-2018 $1,945 $2.27 $23,343 $27.27 $2.50 NNN (Shops) Tenant pays percentage rent of 6% over a natural breakpoint (modeled). Sales have been modeled per the 2016 actuals, grown by 3% annually. Sep-2018 Aug-2021 FUTURE $1,945 $2.27 $23,343 $27.27 NNN Market OPTION $2.50 NNN (Shops) Assumes tenant renews for 3 years at the same rent with no leasing costs. TOTALS / AVERAGES 36,750 $46,914 $1.30 $562,963 $15.57 OCCUPIED SF 36, % AVAILABLE SF % TOTAL SF 36, % You are solely responsible for independently verifying the information in this Memorandum. ANY RELIANCE ON IT IS SOLELY AT YOUR OWN RISK. 19

25 CAPITAL MARKETS NATIONAL RETAIL PARTNERS - WEST AFFILIATED BUSINESS DISCLOSURE CBRE, Inc. operates within a global family of companies with many subsidiaries and related entities (each an Affiliate ) engaging in a broad range of commercial real estate businesses including, but not limited to, brokerage services, property and facilities management, valuation, investment fund management and development. At times different Affiliates, including CBRE Global Investors, Inc. or Trammell Crow Company, may have or represent clients who have competing interests in the same transaction. For example, Affiliates or their clients may have or express an interest in the property described in this Memorandum (the Property ), and may be the successful bidder for the Property. Your receipt of this Memorandum constitutes your acknowledgement of that possibility and your agreement that neither CBRE, Inc. nor any Affiliate has an obligation to disclose to you such Affiliates interest or involvement in the sale or purchase of the Property. In all instances, however, CBRE, Inc. and its Affiliates will act in the best interest of their respective client(s), at arms length, not in concert, or in a manner detrimental to any third party. CBRE, Inc. and its Affiliates will conduct their respective businesses in a manner consistent with the law and all fiduciary duties owed to their respective client(s). CONFIDENTIALITY AGREEMENT Your receipt of this Memorandum constitutes your acknowledgement that (i) it is a confidential Memorandum solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property, (ii) you will hold it in the strictest confidence, (iii) you will not disclose it or its contents to any third party without the prior written authorization of the owner of the Property ( Owner ) or CBRE, Inc., and (iv) you will not use any part of this Memorandum in any manner detrimental to the Owner or CBRE, Inc. If after reviewing this Memorandum, you have no further interest in purchasing the Property, kindly return it to CBRE, Inc. DISCLAIMER This Memorandum contains select information pertaining to the Property and the Owner, and does not purport to be all-inclusive or contain all or part of the information which prospective investors may require to evaluate a purchase of the Property. The information contained in this Memorandum has been obtained from sources believed to be reliable, but has not been verified for accuracy, completeness, or fitness for any particular purpose. All information is presented as is without representation or warranty of any kind. Such information includes estimates based on forward-looking assumptions relating to the general economy, market conditions, competition and other factors which are subject to uncertainty and may not represent the current or future performance of the Property. All references to acreages, square footages, and other measurements are approximations. This Memorandum describes certain documents, including leases and other materials, in summary form. These summaries may not be complete nor accurate descriptions of the full agreements referenced. Additional information and an opportunity to inspect the Property may be made available to qualified prospective purchasers. You are advised to independently verify the accuracy and completeness of all summaries and information contained herein, to consult with independent legal and financial advisors, and carefully investigate the economics of this transaction and Property s suitability for your needs. ANY RELIANCE ON THE CONTENT OF THIS MEMORANDUM IS SOLELY AT YOUR OWN RISK. The Owner expressly reserves the right, at its sole discretion, to reject any or all expressions of interest or offers to purchase the Property, and/or to terminate discussions at any time with or without notice to you. All offers, counteroffers, and negotiations shall be non-binding and neither CBRE, Inc. nor the Owner shall have any legal commitment or obligation except as set forth in a fully executed, definitive purchase and sale agreement delivered by the Owner. Pricing in this Offering Memorandum may not be accurate at any given point in time as market conditions including capitalization rates and other value indicators change frequently. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. Photos herein are the property of their respective owners and use of these images without the express written consent of the owner is prohibited. CBRE and the CBRE logo are service marks of CBRE, Inc. and/or its affiliated or related companies in the United States and other countries. All other marks displayed on this document are the Property of their respective owners. 20

26 Investment Advisors NRP-WEST SAN DIEGO PARTNER DEBT & STRUCTURED FINANCE Philip D. Voorhees Lic Kirk Brummer Lic Sean Heitzler Lic CBRE-Newport Beach 3501 Jamboree Rd., Ste 100 Newport Beach, CA F Reg Kobzi Lic reg.kobzi@cbre.com Scott Peterson Lic scott.peterson@cbre.com NRP-WEST TEAM Philip D. Voorhees Team Leader John Read Kirk Brummer Matt Burson James Tyrrell Preston Fetrow Jimmy Slusher Megan Wood Sean Heitzler For all of our available listings, please visit: *Image has been edited for representative purposes