THE NEWCASTLE DEVELOPMENT

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1 THE ±27,653 SF / LAND FOR SALE WAY,, WA THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL

2 THE THE OPPORTUNITY JLL has been retained as the exclusive agent to sell The Newcastle Development site consisting of one parcel located in Newcastle, six miles south of downtown Bellevue. The Newcastle Development appeals to investors of all product types, as the zoning allows multiple uses including retail, multifamily and office. An exceptional development opportunity, the site benefits from a rapidly growing population, the number one economy, and the fastest rising home prices in the nation. The parcel is currently vacant with the exception of a small parking lot currently utilized by the neighboring Newcastle Library. The Library was built in 2012, consists of 11,000 square feet, various sustainable features, and is central to the heart of Newcastle s evolving civic village. The Newcastle Development is positioned in center of Newcastle s neighborhood retail core, which features numerous grocery, restaurants and services. The city of Newcastle is a peaceful, residential community located between Bellevue and Renton within the Seattle metropolitan area. Residents of Newcastle enjoy a scenic atmosphere, a world class golf club, a short commute to work centers and convenient access to Puget Sound s recreation and urban amenities. Newcastle residents are well educated and 64.6% of the working population is employed in executive, management, and professional occupations. The area has an average household income of $130,000, with 53% of its residents earning $100,000 or more. The median home price is $972,500, with home values rising 19.6% over the past year. This affluent neighborhood ranks in the top 100 best places to live in America, according to Money Magazine, Newcastle is one of only two Washington State cities on the 2017 list. 2

3 EXECUTIVE SUMMARY Downtown Seattle Lake Washington Mercer Island THE Lake Boren NORTH THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 3

4 THE The Newcastle Development 27,653 Square Feet / 0.63 Acres Newcastle Library 4

5 EXECUTIVE SUMMARY PROJECT AND ZONING SUMMARY Address Newcastle Way, Newcastle, WA King County Tax Parcel Total Project Lot Size 27,653 Square Feet / 0.63 Acres Potential Uses Retail, Office, Medical Office Building, Multifamily Current Zoning CBC community business center overlay zone Zoning Summary The CBC overlay zone strives to enhance the commercial core area with a pedestrian-oriented, mixed-use focus for commercial and civic activities, allowing for a mix of commercial and residential uses including multi-story, quality infill development. Density 48du/acre Building Height 45 feet max / 25 feet base FAR 1.00 (2.5:1 max / 1:1 base) 0.25 increase with at least 75% of required parking below ground or in structured parking 0.50 increase with visible landscaping per public requirements increase by achieving LEED Gold or better THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 5

6 THE Downtown Seattle +300,000 jobs Lake Washington Bellevue +150,000 jobs Mercer Island THE 6 NORTH

7 EXECUTIVE SUMMARY INVESTMENT HIGHLIGHTS Exceptional demographics The Newcastle Development represents a rare opportunity to invest in the regions prolific development cycle and to take advantage of nation leading demographics, population and job growth. The average apartment rent in new construction for Newcastle is $1,856 or $2.50 psf. The median household income of $130,000 is double that of the nation. Prime Eastside location Located in the heart of the Eastside, Newcastle is perfectly positioned with easy access to I-405 and I-90 the Eastside s two major interstates. Major employer s headquarters such as Amazon (13.6 miles), Microsoft (9.6 miles) or T-Mobile (3.4 miles) can be reached in less than 30 minutes. Boeing s Renton plant (5.1 miles), Jeff Bezos Blue Origin (12.1 miles) and the Kent Valley (the third largest manufacturing and distribution center in the country) are also accessible in under 30 minutes. High earning technology based rental pool Due to the strong tech job market, relative affordability compared to other major cities, and high quality of living, the Seattle metro area continues to attract workers, at a faster rate than every other major U.S. city. Amazon alone has had a resounding impact on local employment and residential demographics, as it continues to build and lease space in South Lake Union. Microsoft, Facebook, Expedia, Google and other technology companies also continue to aggressively expand their workforces. Targeted development location Suburban neighborhoods like Newcastle are favored locals for many who are looking to live outside of the city, and the area immediately surrounding the site is a targeted location for residential, retail or office development. Newcastle comprehensive plan encourages development in urban areas, and emphasizes the need to convert undeveloped land into higher density developments. The development guidelines and permitting processes are streamlined and efficient compared to other cities in the region. Top metro destination For the first time, Seattle is adding more people on average each year than during the post Gold Rush boom years. Recent U.S. Census Bureau data shows Seattle is gaining about 1,100 residents per week. As a result, the local metro is now listed as the top ranked destination in the country for career-oriented professionals and year-to-date office absorption is higher than the rest of the West Coast combined. THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 7

8 LOCATION AERIAL THE 8 NORTH

9 LOCATION MAP THE NORTH 9

10 THE AMENITY MAP ASA Building Pacific Courts Newcastle Heated Storage Newcastle Fruit & Produce Coal Creek Parkway SE THE Newcastle Library Newcastle Way Podiatry Clinic & Urgent Care 129th Avenue SE 10 THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL

11 EXECUTIVE SUMMARY DEMOGRAPHICS Within the immediate area surrounding The Newcastle development, average median household incomes are $103,876 and median home values are $552,656. For homes sold in January 2018, the median home price was $972,500, with home values rising 19.6% over the past year. While many are trending away from homeownership due to high down payments and expensive monthly mortgages, the strong incomes of area residents allows for continued rent growth and positive demographic statistics. Residential Population The tapestry life mode for Newcastle, as shown by ESRI Business Analyst, is primarily comprised of Enterprising Professionals (38%). Typically residents are well educated and climbing the ladder in STEM (science, technology, engineering, and mathematics) occupations. They change jobs often and therefore choose to live in condos, town homes, or apartments, and many still rent their homes. Residents tend to be located in lower density neighborhoods of large metro areas. Additional large groupings within Newcastle include Professional Pride (21.5%) and Savvy Suburbanites (19%). Professional Pride consumers are well-educated career professionals that have prospered through the Great Recession. To maintain their upscale suburban lifestyles, these goal oriented couples work, often commuting far and working long hours. They are financially savvy, investing wisely and benefit from interest and dividend income. These established families have accumulated an average of 1.5 million dollars in net worth, and their annual household income runs at more than twice the US level. Savvy Suburbanites residents are well educated, well read, and well capitalized. Families include empty nesters and empty nester wannabes, who still have adult children at home. These consumers tend to be located in older neighborhoods outside the urban core. Demographics Population 1 Mile 3 Mile 5 Mile 2017 Total Population: 12,119 85, , Population Estimate: 13,124 91, ,560 Pop Growth : 8.29% 6.90% 7.06% Median Age: Households 2017 Total Households: 4,838 31,326 86,683 Average Household Size: Median Household Income: $103,876 $105,697 $90,822 Avg Household Income: $129,650 $148,008 $129,760 Housing Median Home Value: $552,656 $610,235 $543,438 Average Home Value: $567,144 $664,406 $616,088 1 mile 3 miles 5 miles THE THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 11

12 THE COMPARABLES 12

13 COMPARABLES LAKEHOUSE TOWNHOME SALES COMPARABLES 41 contemporary homes built in 2017 and located in the heart of Newcastle and showcasing thoughtfully designed spacious paired townhomes, ranging in size from 1,539 to 2,418 square feet, with 3 to 5 bedrooms, and 2-car garages. A community inspired by the Northwest region s natural beauty, features include Quartz countertops with full height decorative backsplash, Whirlpool stainless appliances, gas range with convection ovens and undermount sinks. Address Sq. Ft. Type Sold Price Price/ Sq. Ft SE 75th Rd #7 1,959 3 x 2.5 On the Market $849,990 $ SE 75th Lane 2,377 4 x 3.25 Pending $809,990 $ SE 75th Lane 1,992 3 x 2.5 Jun-17 $764,990 $ SE 75th Rd 1,992 3 x 2.5 Feb-18 $770,000 $ SE 75th Rd #11 1,992 3 x 2.5 Jan-18 $778,990 $ SE 75th Lane 1,949 3 x 2.5 Jul-17 $789,990 $ SE 75th Lane 1,959 3 x 2.5 Jul-17 $800,000 $ SE 75th Lane 1,949 3 x 2.5 Sep-17 $810,000 $ SE 75th Rd 1,959 3 x 2.5 Dec-17 $834,990 $ SE 75th Lane 1,959 3 x 2.5 Sep-17 $834,990 $ SE 75th Lane 2,435 3 x 2.5 Sep-17 $850,000 $ SE 75th Rd 1,949 3 x 2.5 Dec-17 $859,990 $ SE 75th Rd 1,949 3 x 2.5 Nov-17 $885,000 $454 THE Lakehouse THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 13

14 THE MULTIFAMILY RENT COMPARABLES #1 Tria Newcastle Way Newcastle, WA Units Built 2017 Average Rent: $1,856 Average Rent PSF: $2.58 #5 Park nd Ave NE Bellevue, WA Units Built 2016 Average Rent: $2,473 Average Rent PSF: $3.36 #2 MileHouse th Avenue NE Redmond, WA Units Built 2015 Average Rent: $1,877 Average Rent PSF: $2.73 #6 Hadley th Avenue SE Mercer Island, WA Units Built 2016 Average Rent: $2,186 Average Rent PSF: $3.30 #3 Main Street Flats Main Street Bellevue, WA Units Built 2015 Average Rent: $2,016 Average Rent PSF: $2.91 #7 Venn at Main NE 1st Street Bellevue, WA Units Built 2016 Average Rent: $1,925 Average Rent PSF: $2.64 #4 Atlas Issaquah th Avenue NW Issaquah, WA Units Built 2016 Average Rent: $1,985 Average Rent PSF: $2.59 #8 The Meyden Main Street Bellevue, WA Units Built 2016 Average Rent: $2,130 Average Rent PSF: $

15 COMPARABLES MULTIFAMILY RENT COMPARABLES MAP MileHouse Venn at Main Park 88 Main Street Flats The Meyden Hadley THE Tria Atlas THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 15

16 THE MULTIFAMILY SALES COMPARABLES #1 #2 #3 #4 #5 Tria Newcastle Way Hadley th Avenue Venn at Main NE 1st Street MileHouse th Avenue NE LIV Bel-Red 2170 NE Bel-Red Road Newcastle, WA Mercer Island, WA Bellevue, WA Redmond, WA Bellevue, WA Units: 76 Units: 209 Units: 350 Units: 177 Units: 451 Built: 2017 Built: 2016 Built: 2016 Built: 2015 Built: 2015 Sold: Dec 2017 Sold: Oct 2017 Sold: Sept 2017 Sold: Nov 2016 Sold: Sept 2016 Avg Unit Size: 822 Avg Unit Size: 733 Avg Unit Size: 758 Avg Unit Size: 822 Avg Unit Size: 800 Total Price: $23,950,000 Total Price: $95,750,000 Total Price: $176,500,000 Total Price: $69,300,000 Total Price: $172,000,000 Retail Price: $0 Retail Price: $5,330,510 Retail Price: $21,800,000 Retail Price: $1,012,383 Retail Price: $0 Price/Unit: $315,132 Price/Unit: $432,629 Price/Unit: $442,000 Price/Unit: $385,806 Price/Unit: $381,375 Price/SF: $415 Price/SF: $590 Price/SF: $583 Price/SF: $469 Price/SF: $477 16

17 COMPARABLES MULTIFAMILY SALES COMPARABLES MileHouse LIV Bel-Red Venn at Main Hadley THE Tria THE OFFERING MEMORANDUM LISTED EXCLUSIVELY BY JLL 17

18 THE TRANSACTION GUIDELINES

19 INVESTMENT CONTACTS TRANSACTION GUIDELINES The offering of The Newcastle Development is being conducted exclusively by JLL. All questions and inquiries should be addressed to the JLL representatives listed herein. The JLL team will be available to assist prospective investors with their review of the offering. This includes on-site inspections of the property and tours of the market area. Investors will receive advanced notification of the bid deadline via . Offers should include, at a minimum, the following: The purchase price and closing date The source of capital, both equity and debt, for the transaction The amount of earnest money deposit A detailed schedule of the due diligence and requisite approval process A description of assumptions utilized for the offer MATT KEMPER Phone: matt.kemper@am.jll.com DON FLANIGAN Phone: don.flanigan@am.jll.com MARK THYGESEN Phone: mark.thygesen@am.jll.com DAVID YOUNG Phone: david.young@am.jll.com COREY MARX Phone: corey.marx@am.jll.com FINANCING CONTACTS RAY ALLEN Phone: ray.allen@am.jll.com Disclaimer: Copyright Jones Lang LaSalle IP, Inc This publication is the sole property of Jones Lang LaSalle and must not be copied, reproduced or transmitted in any form or by any means, either in whole or in part, without the prior written consent of Jones Lang LaSalle. The information contained in this publication has been obtained from sources generally regarded to be reliable. However, no representation is made, or warranty given, in respect of the accuracy of this information. Jones Lang LaSalle does not accept any liability in negligence or otherwise for any loss or damage suffered by any party resulting from reliance on this publication. SETH HEIKKILA Phone: seth.heikkila@am.jll.com Jones Lang LaSalle Americas, Inc. License #