INTERSTATE 10 EAST HOUSTON, TEXAS EXECUTIVE SUMMARY

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1 Federal East Plaza INTERSTATE 10 EAST HOUSTON, TEXAS EXECUTIVE SUMMARY

2 Investment Merits PROPERTY Federal East Plaza Interstate 10 East Houston, Harris Count, Texas LOCATION South side of Interstate 10 East - West of Federal Road 9 Miles East of Houston s Central Business District YEAR BUILT Construction completed in 1977, 1991 & 2002 OCCUPANCY 66% PARKING 767 Spaces (7.25 per 1000 SF) TOTAL GLA 105,833 SF PROPERTY HIGHLIGHTS Immediate Value Add Potential Over 35,000 SF of Vacant Space Additional Opportunit to Grow NOI with Below Market Rents Ideall Positioned on the Heavil Traveled Interstate-10 With Exposure to over 312,000 Vehicles Per Da Outstanding Frontage and Site Line Visibilit Along Interstate 10 Densel Populated Trade Area Estimated 178,000 Residents within 5-Mile Radius Houston is listed b AFIRE as the 4th Best Cit in the World of Commercial Real Estate Investment LAND SIZE Acres Nation Leading Population and Emploment Growth over the Past Decade DEBT PRICE IN-PLACE NOI Available for New Market Rate Financing Market Click to Sign a Confidentialit Agreement EXECUTIVE SUMMARY 1

3 Investment Merits VALUE CREATION OPPORTUNITY Federal East Plaza is 66% leased to 9 tenants who have an average in-place net rental rate of $14.10/ SF annuall. Federal East Plaza offers an attractive initial ield with the near term opportunit for investors to significantl increase operating cash flow b implementing an aggressive leasing and tenant retention strateg. Prospective buers have the opportunit to create value and recognize upside potential b leasing the 35,000 square feet of currentl vacant space. TRAFFIC VOLUME AND VISIBILITY Located in Harris Count, one of the fastest growing counties in the United States, Federal East Plaza offers outstanding visibilit and access from Interstate 10 in both directions. This major east-west thoroughfare has current traffic volumes consisting of 312,000 vehicles per da on Interstate 10 and over 70,000 vehicles per da on Federal Road. NICHE ETHNIC MARKET Federal East Plaza is positioned nine miles east of the Central Business District of Houston. The propert is surrounded b densel populated residential areas bisected b Houston s primar east-west interstate. Historicall, the area is driven b a strong Hispanic-oriented submarket of Houston. Within one mile of the center, more than 83% of the population is of Hispanic or Latino decent, with greater than 70% Hispanic or Latino decent within both 3 and five miles of the center. EXTREMELY DENSE POPULATION WITH EXPECTED GROWTH There are currentl more than 178,000 people living within a 5-mile radius of Federal East Plaza. The area s average income of approximatel $50,000 is projected to grow b approximatel 5.5% inside 3 miles of the center and almost 6% within 5 miles b the ear GLOBAL RECOGNIZED METRO ECONOMY The Association of Foreign Investors in Real Estate ( AFIRE ), a global commercial real estate professional association representing over $2 trillion dollars of real estate assets under management, has named Houston, Texas the fourth best cit in the world for commercial real estate investment. TOP GLOBAL CITIES 1 London (#2 last ear) 2 New York (#1 last ear) 3 San Francisco (#3 last ear) 4 Houston (#5 last ear) 5 Los Angeles (#14 last ear) EXECUTIVE SUMMARY 2

4 Location Maps der Construction Grand Pkw U n w Pk x Frw Lake Houston State Park Eas te nd Nor mand St a Gr MONTGOMERY struction on rc ExxonMobil de Corporate Headquarters n U HARRIS Pr M ar ket St R d op George Bush Intercontinental Airport d Hw n East Loop Batow Frw Kat Frw Galleria ark Tollwa Westp hw ut So FORT BEND rw tf es West Loop Westheimer Rd 69 Texas Medical Centerth Sou East Loop Downtown George Bush Park San Jacinto Ba Pasadena Frw Loop 69 Galveston Ba Pk w William P. Hobb Airport lf South Frw Be nd Sam Houston Tollwa Gu w Fr Fort PROPERTY OVERVIEW ont aum Be North Sheldon Reservoir w Fr Pkw 69 Road Frw rth st No we ed Lake Houston Toll Hard Federal R d Holland Ave rth os Gran Sam Houston Pkw No LIBERTY 69 Armand Baou Park Clear Lake Smithers Lake Proposed Grand Pkw BRAZORIA GALVESTON 3

5 Aerial Photograph Downtown Houston Wilke Park SELLERS BROS. Jacinto Cit Police Dept Elbert L. Furr Highschool Jacinto Cit Elementar School Smith Park Market Street Road East Freewa 3 1 2, V P D PROPERTY OVERVIEW FITNESS 4

6 Site Plan Bello Amanecer 4,000 SF Available 3,010 SF Available SF Available 5,190 SF Available - 1,200 SF South Texas Dental 3,200 SF FITNESS 33,589 SF Available 13,249 SF Peking Bo 4,500 SF Available 12,416 SF TMD Temps 992 SF H&R Block 1,408 SF 4,510 SF 11,030 SF Craz Alan s Swamp Shack 6,689 SF PROPERTY OVERVIEW Plon Plon Plon Sign Plon Sign Plon Plon Frontage Road Interstate Highwa I ,000 VPD 5

7 Tenant Profile FITNESS CONNECTION Tenant: Fitness Connection Parent Compan: Titans Fitness Texas, LLC Square Feet: 33,589 Public/Private: Private Ticker Smbol: 2013 Revenue: S&P Rating: Website: FITNESS Titan Fitness owns and operates health clubs under the Fitness Connection brand located in the greater Raleigh, North Carolina area; Greenville, North Carolina; Reno, Nevada and Houston, Texas. With 26 locations across the countr, Fitness Connection is one of the newest and fastest growing fitness chains in the United States. Other than operating as just a gm, the compan believes in promoting a health lifestle, creating a broad offering that inspires and supports people in their quest for good health. PAPPAS RESTAURANTS AVENUE Tenant: Avenue Stores, LLC Square Feet: 4,510 Public/Private: Private Ticker Smbol: 2013 Revenue: S&P Rating: Website: Avenue Stores caters to the plus-size customer. The retailer sells moderatel priced plus-size (sizes 14 to 32) clothing and accessories to fashion-conscious women ages 25 to 55 through about 300 Avenue stores in some 35 states. The stores offer casual and career wear under the compan's Avenue private label. It also carries lingerie and shape wear under the Avenue Bod name. Besides brick-and-mortar outlets, the chain markets merchandise through its e-commerce site. The compan is owned b the Philadelphia-based private equit firm Versa Capital Management, which bought it out of bankruptc. TENANCY Tenant: Pappas Seafood House Parent Compan: Pappas Restaurants, Inc. Square Feet: 11,030 Public/Private: Private Ticker Smbol: 2013 Revenue: S&P Rating: Website: The Pappas Brothers opened their first restaurant in 1976 and set out to serve onl the highest qualit food. Since then, the compan has opened more than 100 restaurants and has become a leader in the hospitalit industr. Pappas continues to be a famil owned and operated compan in Houston, Texas. Pappas Restaurants are constantl focused on innovation, attention to detail and qualit in everthing the do. Currentl the companies list of restaurants includes Pappadeaux, Pappas Burger, Pappas Seafood House, Pappas Bar-B-Q, Pappas Bros. Steakhouse, Dot, Pappasito s Cantina and Yia Yia Mar s Pappas Greek Kitchen. 6

8 Phsical Description IMPROVEMENT DATA Roof: The roof sstem of the strip retail buildings consists of a Address: Interstate 10 East gravel surface built-up asphalt roof on a galvanized metal Site Area: acres deck with a light weight insulation fill, a sloped asphalt shingle roof at the parapet walls, with drainage water collected b Parking Spaces: 767 Total Spaces; ratio of 7.25 spaces per 1,000 square feet. Year Built: Construction Completed in 1977, 1991 & 2002 continuous gutters and downspouts. The roof sstem at Pappas consists of a combination of mineral surface cap sheet and pitched standing seam metal roofs with continuous ASSESSMENT AND TAX DATA gutters and downspouts. Tax Rate % Ceiling Sstem: Tpicall suspended acoustical panels. Account Number Fire Protection: Full coverage wet-pipe sprinkler sstem with fire department SITE AND IMPROVEMENT DESCRIPTION hose valves and connections on the exterior of building. Parking: Construction: Interior Finish: Asphalt surface parking is spread across the site, situated directl between the store-fronts and Interstate 10. Parking also surrounds both restaurant pad sites, allowing consumers to park near their destination while still maintaining visibilit of the entire center. New asphalt improvements of nearl $300,000 in October The buildings have structural steel or wood frames, brick veneer walls, and EIFS, tinted, or clear, single pane and double pane glass Interior finishes var b tenant, but walls tpicall consist of painted drwall, painted concrete block, stained wood Electrical: Zoning: Flood Plain: Electrical power provided to the merchants is separatel metered. The Cit of Houston currentl does not have a zoning ordinance. Sites are tpicall developed to their highest and best economic use and an use restrictions would be accomplished via deed restrictions or use clauses in a deed Located in Zone X, which is determined to be outside the 100-ear floodplain. The current ownership is not aware of an existing flooding problems from Hunting Baou, which runs directl behind the center. PROPERTY OVERVIEW panels, or brick veneer on partitioning metal studs, and floors are covered with carpet, ceramic tile, or vinl flooring HVAC Sstem: Heating and cooling is provided to the tenant areas b electric rooftop package units that are single package, constant volume with R-22 refrigerant, with refrigeration tonnage ranging from 2 to 20-tons. 7

9 Location Overview LOCATION SUMMARY Located near the intersection of Interstate 10 and Federal Road in Houston, Texas, Federal East Plaza is well-positioned to benefit from the predominatel Hispanic and Latino population base along Interstate 10, one of Houston s most traveled thoroughfares. Federal East Plaza is located in Harris Count, which is among the most expansive counties in Texas and has been among the fastest growing counties in the countr over the last decade. With its outstanding location just off the frontage road of Interstate 10, the center has numerous ingress/ egress points and excellent site line visibilit from both the freewa and the feeder, making Federal East Plaza easil accessible to trade area residents. In addition, the center is immediatel surrounded b a population of more than 188,000 in densel populated residential areas and is in close proximit to a variet of residential housing options. DEMOGRAPHICS DESCRIPTION 1 MILE RADIUS 3 MILE RADIUS 5 MILE RADIUS Population 2019 Projection 17,562 81, , Estimate 16,519 76, , Census 15,808 74, , Census 16,589 73, ,450 Growth % 5.5% 5.7% Growth % 3.5% 3.7% Growth % 1.3% 3.3% Households 2019 Projection 4,912 24,600 56, Estimate 4,627 23,294 53, Census 4,441 22,501 51, Census 4,770 22,764 50,251 Growth % 5.6% 5.8% Growth % 3.5% 3.8% Growth % -1.2% 1.7% Income 2014 Est. Average Household Income $42,822 $47,007 $49, Est. Median Household Income $35,326 $37,678 $39,581 Housing Value 2014 Est. Median Housing Value $81,570 $84,404 $87,942 ECONOMIC OVERVIEW 8

10 OFFERED EXCLUSIVELY BY INVESTMENT SALES RUSTY TAMLYN, CCIM, SIOR Senior Managing Director Phone (713) RYAN WEST Managing Director Phone (713) MATT BERRY Associate Director Phone (713) ROBBIE KILCREASE Analst Phone (713) FOR FINANCING INQUIRIES CORBY CHAFFIN Associate Director Phone (713) Greenwa Plaza Suite 700 Houston Texas Phone (713) Fax (713) Hollida Fenoglio Fowler, L.P. acting b and through Hollida GP Corp a Texas licensed real estate broker ( ) and S ( Securities L.P.) are owned b, Inc. (NYSE: HF). operates out of 23 offices nationwide and is a leading provider of commercial real estate and capital markets services to the U.S. commercial real estate industr. together with its affiliate S offer clients a full integrated national capital markets platform including debt placement, investment sales, equit placement, advisor services, loan sales and commercial loan servicing. For more information please visit hfflp.com or follow on has been engaged b the owner of the propert [properties] to market it [them] for sale. Information concerning the propert [properties] described herein has been obtained from sources other than and we make no representations or warranties, express or implied, as to the accurac or completeness of such information. An and all references to age, square footage, income, expenses and an other propert specific information are approximate. An opinions, assumptions, or estimates contained herein are projections onl and used for illustrative purposes and ma be based on assumptions or due diligence criteria different from that used b a buer. Buers should conduct their own independent investigation and rel on those results. The information contained herein is subject to change. 10/14