OFFERING MEMORANDUM. STORAGE DIRECT MARANA 7020 North Camino Martin, Tucson, Arizona SELF STORAGE A DVISORY GROUP

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1 OFFERING MEMORANDUM STORAGE DIRECT MARANA 7020 North Camino Martin, Tucson, Arizona SELF STORAGE A DVISORY GROUP NICK WALKER Vice President of Investments W C Lic Nick.Walker@cbre.com TREVOR ROBERTS Senior Associate W C Lic Trevor.Roberts@cbre.com MORGAN WINDBIEL Associate W C Lic Morgan.Windbiel@cbre.com Capital Markets Investment Properties

2 Affiliated Business Disclosure and Confidentiality Agreement ALL PROPERTY TOURS SHOULD BE SCHEDULED THROUGH THE LISTING AGENT. WE ASK THAT YOU DO NOT DISTURB THE ONSITE PERSONNEL. CBRE, Inc. operates within a global family of companies with many subsidiaries and/or 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 may represent various clients with competing interests in the same transaction. For example, this Memorandum may be received by our Affiliates, including CBRE Investors, Inc. or Trammell Crow Company. Those, or other, Affiliates may express an interest in the property described in this Memorandum (the Property ) may submit an offer to purchase the Property and may be the successful bidder for the Property. You hereby acknowledge that possibility and agree that neither CBRE, Inc. nor any involved Affiliate will have any obligation to disclose to you the involvement of any Affiliate in the sale or purchase of the Property. In all instances, however, CBRE, Inc. will act in the best interest of the client(s) it represents in the transaction described in this Memorandum and will not act in concert with or otherwise conduct its business in a way that benefits any Affiliate to the detriment of any other offeror or prospective offeror, but rather will conduct its business in a manner consistent with the law and any fiduciary duties owed to the client(s) it represents in the transaction described in this Memorandum. This is a confidential Memorandum intended solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property. This Memorandum contains selected information pertaining to the Property and does not purport to be a representation of the state of affairs of the Property or the owner of the Property (the Owner ), to be all-inclusive or to contain all or part of the information which prospective investors may require to evaluate a purchase of real property. All financial projections and information are provided for general reference purposes only and are based on assumptions relating to the general economy, market conditions, competition and other factors beyond the control of the Owner and CBRE, Inc. Therefore, all projections, assumptions and other information provided and made herein are subject to material variation. All references to acreages, square footages, and other measurements are approximations. Additional information and an opportunity to inspect the Property will be made available to interested and qualified prospective purchasers. In this Memorandum, certain documents, including leases and other materials, are described in summary form. These summaries do not purport to be complete nor necessarily accurate descriptions of the full agreements referenced. Interested parties are expected to review all such summaries and other documents of whatever nature independently and not rely on the contents of this Memorandum in any manner. Neither the Owner or CBRE, Inc, nor any of their respective directors, officers, Affiliates or representatives make any representation or warranty, expressed or implied, as to the accuracy or completeness of this Memorandum or any of its contents, and no legal commitment or obligation shall arise by reason of your receipt of this Memorandum or use of its contents; and you are to rely solely on your investigations and inspections of the Property in evaluating a possible purchase of the real property. The Owner expressly reserved 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 with any entity at any time with or without notice which may arise as a result of review of this Memorandum. The Owner shall have no legal commitment or obligation to any entity reviewing this Memorandum or making an offer to purchase the Property unless and until written agreement(s) for the purchase of the Property have been fully executed, delivered and approved by the Owner and any conditions to the Owner s obligations therein have been satisfied or waived. By receipt of this Memorandum, you agree that this Memorandum and its contents are of a confidential nature, that you will hold and treat it in the strictest confidence and that you will not disclose this Memorandum or any of its contents to any other entity without the prior written authorization of the Owner or CBRE, Inc. You also agree that you will not use this Memorandum or any of its contents in any manner detrimental to the interest of the Owner or CBRE, Inc. If after reviewing this Memorandum, you have no further interest in purchasing the Property, kindly return this Memorandum to CBRE, Inc. Table of Contents Property Description 3 Property Description Property Summary... 5 Maps Aerial Property Pictures... 8 Financials 11 Unit Mix. 12 Income & Expenses. 13 Rent Comparables 14 Rent Comparables Map.. 15 Rent Comparables Graphs. 16 Rent Comparables Demographics 21 Traffic Counts 22 Demographics 23

3 Property Description

4 PROPERTY DESCRIPTION Storage Direct Marana is well constructed self storage facility located in Tucson, Arizona. This 53,175 net rentable square foot facility consists of 457 non-climate and climate controlled drive up units ranging in size from 5 x5 to 30 x30. The facility also offers 53 uncovered RV and Boat parking spaces equating to an additional 18,300 net rentable square feet. As of May 2015 the property is 65.6 percent physically occupied and 61 percent economically occupied. Sitting on 3.8 acres, this attractive self storage facility consists of eight single story buildings of metal construction equipped with metal roofs and roll up doors. Storage Direct Marana offers numerous amenities including a gated entrance with key code access, 24-hour video surveillance cameras, well lit building and aisles, and wide asphalt drive aisles for easy access. The property is conveniently located on North Camino Martin just seconds off of the Interstate 10 Freeway. The property sits in a highly populated area with over 117,682 people living within a five mile radius. Tucson is the 33 rd largest city and the 52 nd largest metropolitan area in the United States. Tucson shows progressive growth with nearly 2,000 new residents each month. With this increase in population, the city of Tucson continues to increase their progress and innovation, providing quality multiple municipal services to promote a healthy community of opportunity. 53,175 Net Rentable Square Feet 510 Total Units 65.6 Percent Physically Occupied Built in 1998 Population Over 117,682 Within a Five Mile Radius 4 Storage Direct Marana

5 PROPERTY SUMMARY STORAGE DIRECT MARANA ADDRESS: 7020 North Camino Martin Tucson, AZ ASSESSORS S PARCEL NUMBER: B BUILDING SIZE: ± 53,175 NRSF TOTAL UNITS: 510 LAND AREA: ± 3.8 Acres OCCUPANCY: 65.6% YEAR BUILT: 1998 NUMBER OF BUILDINGS: Eight Buildings NUMBER OF STORIES: Single Story UNIT SIZES: See Unit Mix For Details FRAMING: Metal PARKING: Yes; See Unit Mix For Details EXTERIOR WALLS: Metal STREET FRONTAGE: North Camino Martin PARKING SURFACE: Asphalt CROSS STREET: West Ina Road ROOF: Metal HIGHWAY ACCESS: Interstate 10 Freeway FENCING: Wrought Iron ENTRY: Gated Entry with Key Code Access SECURITY: Video Surveillance 5 Storage Direct Marana

6 LOCATION MAP 6 Storage Direct Marana

7 AERIAL/MAP 7 Storage Direct Marana

8 PROPERTY PHOTOS 8 Storage Direct Marana

9 PROPERTY PHOTOS 9 Storage Direct Marana

10 PROPERTY PHOTOS 10 Storage Direct Marana

11 Financials

12 FINANCIALS UNIT MIX Drive Up No. of Units Unit Type SF/Unit Rent/Unit Monthly Income Annual Income 2 5X5 25 $30.00 $60.00 $ X10 50 $45.00 $1, $15, X5 65 $50.00 $ $2, X15 75 $70.00 $ $1, X $75.00 $4, $58, X $90.00 $ $3, X $ $ $2, X $ $4, $54, X $ $5, $62, X $ $ $4, Total 27,100 $17, $205, Climate Controlled No. of Units Unit Type SF/Unit Rent/Unit Monthly Income Annual Income 33 5X5 25 $40.00 $1, $15, X7 35 $50.00 $ $6, X10 50 $55.00 $3, $36, X15 75 $80.00 $ $1, X10 80 $80.00 $ $1, X $ $ $2, X $85.00 $7, $87, X $ $7, $91, X $ $1, $12, X $ $ $8, Total 26,075 $22, $265, RV & Vehicle Parking No. of Units Unit Type SF/Unit Rent/Unit Monthly Income Annual Income 2 RV-Boat 1 $45.00 $90.00 $1, RV-Boat 2 $52.00 $52.00 $ RV-Boat 3 $55.00 $2, $33, Total $2, $34, Total 510 Total 53,175 $42, $506, *There is an additional 18,300 net rentable square feet of RV & vehicle parking. 12 Storage Direct Marana

13 FINANCIALS INCOME & EXPENSES INCOME January - April 2015 Income and Expenses Annualized PER SF Pro Forma PER SF GROSS POTENTIAL RENT $506,628 $9.53 $506,628 $9.53 Late, Letter, & NSF Fees $4,459 $0.08 $4,459 $0.08 Merchandise Sales (NET) $464 $0.01 $464 $0.01 Administration Fees $3,060 $0.06 $3,060 $0.06 Insurance * $13,102 $0.25 $13,102 $0.25 TOTAL OTHER INCOME $21,085 $0.40 $21,085 $0.40 Gross Potential Income $527,713 $9.92 $527,713 $9.92 Economic Vacancy/ Collection Allowance 39.0% $197,550 $ % $101,745 $1.91 EFFECTIVE GROSS INCOME $330,163 $6.21 $425,968 $8.01 EXPENSES Property Taxes (1) $53,798 $1.01 $53,798 $1.01 Insurance (2) $4,765 $0.09 $4,765 $0.09 Utilities & Trash (3) $12,036 $0.23 $12,036 $0.23 Repairs, Maintenance and Reserves (4) $7,958 $0.15 $7,958 $0.15 Advertising & Call Center (5) $10,000 $0.19 $10,000 $0.19 Salaries, Taxes, & Benefits (6) $49,943 $0.94 $49,943 $0.94 Management Fee (7) $16,508 $0.31 $21,298 $0.40 Office Supplies & Postage (8) $4,956 $0.09 $4,956 $0.09 Bank & Credit Card Fees (9) $5,685 $0.11 $5,685 $0.11 Telephone & Internet (10) $5,739 $0.11 $5,739 $0.11 Contract Services (11) $6,127 $0.12 $6,127 $0.12 Computer Expenses (12) $2,991 $0.06 $2,991 $0.06 Truck Expense (13) $2,292 $0.04 $2,292 $0.04 Total Expenses $182,798 $3.44 $187,588 $3.53 % of EGI 55.4% 44.0% NET OPERATING INCOME $147,365 $2.77 $238,380 $4.48 Property Summary $/SF Price Cap Rate $/SF Price Cap Rate 53,175 NRSF $47.48 $2,525, % $47.48 $2,525, % 510 Units Comments: * Insurance is based on 75% of what is actually being collected. (1) Property Taxes are based on 2014 actual taxes. (8) Office Supplies & Postage are based on trailing 12 months expenses. (2) Insurance has been adjusted up by Broker from $1924 to industry standards. (9) Bank & Credit Card Fees are based on trailing 12 months expenses. (3) Utilities & Trash are based on January through April 2015 expenses annualized. (10) Telephone & Internet are based on trailing 12 months expenses. (4) Repairs, Maintenance, and Reserves have been adjusted to $0.15/SF/Year. (11) Contract Service includes landscaping, pest control, fire, and security. (5) Advertising and Call Center has been adjusted by Broker from $120,744 to $10,000. (12) Computer Expenses are based on trailing 12 months expenses. (6) Salaries, Taxes, & Benefits are based on trailing 12 months expenses. (13) Truck Expense is based on trailing 12 months expenses. (7) Management Fee is based on 5% of the Effective Gross Income per industry standards. Storage Direct Marana

14 Rent Comparables

15 RENT COMPARABLES MAP 15 Storage Direct Marana

16 RENT COMPARABLES GRAPHS 16 Storage Direct Marana

17 RENT COMPARABLES GRAPHS 17 Storage Direct Marana

18 RENT COMPARABLES Storage Direct Marana Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 7020 N Camino Martin Tucson, AZ Drive Up DNH DNH $0.75 Total Units: 510 Occupancy: 65.6% Year Built: 1998 Distance: Subject 1st Floor CC $1.06 Property Amenities: Gated Entry with Key Code Access, Video Surveillance, Wide Drive Aisles, Well Lit Buildings and Aisles. 1 Northwest RV & Self Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 7041 N Camino Martin Tucson, AZ Drive Up $0.98 Total Units: 400 Year Built: 1985 Distance: 0.06 Miles 1st Floor CC Does Not Offer Climate Controlled Units Rent Specials: Pay 1st Month Get the 2nd Month Free. Property Amenities: All Drive Up Units, Gated Entry with Key Code Access, Video Surveillance, Resident Manager, Wide Drive Aisles. 2 Ina Road Self Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 6950 N Camino Martin Tucson, AZ Drive Up $0.82 Total Units: 655 Year Built: 1980 Distance: 0.1 Miles 1st Floor CC Does Not Offer Climate Controlled Units Rent Specials: Pay 1st Month Get the 2nd Month Free. Property Amenities: Gated Entry with Key Code Access, Video Surveillance, Resident Manager, Wide Drive Aisles. 3 A Family Discount Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 4320 W Ina Road Tucson, AZ Drive Up $0.88 Total Units: 695 Year Built: 1999 Distance: 0.3 Miles 1st Floor CC DNH $0.92 Property Amenities: Gated Entry with Key Code Access, Video Surveillance, Wide Drive Aisles. 4 U-Haul Moving & Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 4040 W Ina Road Tucson, AZ Drive Up DNH $1.17 Year Built: 1989 Distance: 0.4 Miles 1st Floor CC DNH $1.30 Rent Specials: No Deposit or Administration Fee Property Amenities: Video Surveillance, SafeStor Protection, Move In Trucks, Climate Controlled, Free Loading Carts. 18 Storage Direct Marana

19 RENT COMPARABLES 5 Thornydale Self Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 6955 N Thornydale Road Tucson, AZ Drive Up $0.87 Total Units: 400 Year Built: 1996 Distance: 0.5 Miles 1st Floor CC Does Not Offer Climate Contolled Units Rent Specials: Second Months Rent Free Property Amenities: Gated Entry with Key Code Access, Video Surveillance, Wide Drive Aisles, Rental Truck, Fire Alarm System, Well Lit. 6 Ina Freedom Self Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 4676 W Ina Road Drive Up Does Not Offer Non-Climate Controlled Units Tucson, AZ Total Units: 540 1st Floor CC $1.00 Year Built: 2009 Distance: 0.5 Miles Rent Specials: $1 Second Months Rent Property Amenities: Gated Entry with Key Code Access, Wide Drive Aisles, Rental Truck. *This property is being taken by Eminent Domain for the expansion of the Ina Road onramp. 7 CubeSmart Self Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 3680 W Orange Grove Road Tucson, AZ Drive Up $0.93 Total Units: 480 Year Built: 1982 Distance: 0.97 Miles 1st Floor CC Property Only Offer Climate Controlled in 3'X4' and 3'X8'. Rent Specials: Up to 15% Off and First Months Rent Free. Property Amenities: Gated Entry with Key Code Access, Video Surveillance,Wide Drive Aisles, Vehicle Parking. 8 A Family Discount Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 3905 W Magee Road Tucson, AZ Drive Up $0.89 Total Units: 468 Year Built: 2004 Distance: 1.2 Miles 1st Floor CC $1.01 Property Amenities: Gated Entry with Key Code Access, Video Surveillance, Air Cooled Units Available. 9 U-Haul Moving & Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 7701 N I10 EB Frontage Road Marana, AZ Drive Up $1.05 Total Units: 770 Year Built: 2007 Distance: 1.4 Miles 1st Floor CC $1.22 Rent Specials: First Months Rent Free Property Amenities: Gated Entry with Key Code Access, Video Surveillance, Climate Controlled Units Available. 19 Storage Direct Marana

20 RENT COMPARABLES 10 A Family Discount Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 3535 W Magee Road Tucson, AZ Drive Up $0.94 Total Units: 725 Year Built: 2006 Distance: 1.5 Miles 1st Floor CC Rent Specials: $1 First Months Rent Property Amenities: Gated Entry with Key Code Access, Video Surveillance. $ A Family Discount Storage Unit Type 5x5 5x10 10x10 10x15 10x20 Avg. Rent/SF 3131 W Orange Grove Road Tucson, AZ Drive Up $0.82 Total Units: 660 Year Built: 2001 Distance: 1.5 Miles 1st Floor CC Rent Specials: $1 First Months Rent Property Amenities: Gated Entry with Key Code Access, Video Surveillance. $ Storage Direct Marana

21 Demographics

22 TRAFFIC COUNTS 22 Storage Direct Marana

23 HOUSING INCOME HOUSEHOLDS POPULATION DEMOGRAPHIC REPORT ONE-MILE RADIUS THREE-MILE RADIUS FIVE-MILE RADIUS 2014 Estimated Population 4,509 51, , Projected Population 4,485 53, , Census Population 4,630 51, , Census Population 4,936 49, ,193 Growth % 0.79% 1.81% Growth % 2.39% 3.19% 2014 Estimated Median Age Estimated Average Age Estimated Households 1,607 20,652 47, Projected Households 1,623 21,320 48, Census Households 1,608 20,221 46, Census Households 1,656 18,320 39,514 Growth % 2.13% 2.38% Growth % 3.23% 3.57% 2014 Est. Average Household Size Est. Median Household Income $58,174 $55,390 $56, Prj. Median Household Income $58,392 $56,172 $57, Cen. Median Household Income $48,058 $48,624 $48, Est. Average Household Income $64,578 $67,914 $70, Estimated Per Capita Income $23,023 $26,981 $28, Estimated Housing Units 1,707 22,264 51, Estimated Occupied Units 1,607 20,652 47, Estimated Vacant Units 100 1,612 4, Est. Owner Occupied Units 1,318 14,290 33, Est. Renter Occupied Units 289 6,362 13, Est. Median Housing Value $162,607 $178,635 $191, Est. Average Housing Value $182,223 $218,393 $238, Storage Direct Marana

24 Capital Markets Investment Properties Specializing in Self Storage Brokerage Throughout the United States Self Storage Advisory Group Nick Walker Vice President of Investments W C Lic Nick.Walker@cbre.com Trevor Roberts Senior Associate W C Lic Trevor.Roberts@cbre.com Morgan Windbiel Associate W C Lic Morgan.Windbiel@cbre.com CBRE THE WORLDS LARGEST COMMERCIAL REAL ESTATE FIRM CBRE 2014 All Rights Reserved. All information included in this proposal pertaining to CBRE including but not limited to its operations, employees, technology and clients are proprietary and confidential, and are supplied with the understanding that they will be held in confidence and not disclosed to third parties without the prior written consent of CBRE. This letter/proposal is intended solely as a preliminary expression of general intentions and is to be used for discussion purposes only. The parties intend that neither shall have any contractual obligations to the other with respect to the matters referred herein unless and until a definitive agreement has been fully executed and delivered by the parties. The parties agree that this letter/proposal is not intended to create any agreement or obligation by either party to negotiate a definitive lease/purchase and sale agreement and imposes no duty whatsoever on either party to continue negotiations, including without limitation any obligation to negotiate in good faith or in any way other than at arm s length. Prior to delivery of a definitive executed agreement, and without any liability to the other party, either party may (1) propose different terms from those summarized herein, (2) enter into negotiations with other parties and/or (3) unilaterally terminate all negotiations with the other party hereto. This information has been obtained from sources believed reliable. We have not verified it and make no guarantee, warranty or representation about it. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs.