USA LIVING CHULA VISTA, CALIFORNIA ACTUAL PHOTO

USA LIVING CHULA VISTA, CALIFORNIA ACTUAL PHOTO

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FINANCIAL OVERVIEW 476 Broadway Chula Vista, CA 91910 Price $3,580,000 Gross Leasable Area (GLA) 19,200 SF Price / SF $186.46 CAP Rate 7.19% Net Operating Income $257,280.57 Year Built 1972 Lot Size 0.74 +/- Acres Type of Ownership Fee Simple Parcel Number: 567-200-4600 LEASE SUMMARY Lease Type Modified Gross Roof & Structure Landlord Responsible for Roof Membrane and Bearing Wall Lease Term 10-Year Lease Commencement 09/01/2013 Rent Commencement 09/01/2013 Lease Expiration 08/31/2023 Term Remaining 8.5 Years Increases 3% Annually Options Two, 5-Year ANNUALIZED OPERATING DATA TERM ANNUAL RENT MONTHLY RENT 9/1/2015-8/31/2016 $303,105.02 $25,258.75 9/1/2016-8/31/2017 $312,198.17 $26,016.51 9/1/2017-8/31/2018 $321,564.12 $26,797.01 9/1/2018-8/31/2019 $331,211.04 $27,600.92 9/1/2019-8/31/2020 $341,147.37 $28,428.95 9/1/2020-8/31/2021 $351,381.79 $29,281.82 9/1/2021-8/31/2022 $361,923.25 $30,160.27 9/1/2022-8/31/2023 $372,780.94 $31,065.08 Base Rent ($15.79/SF) $303,105.02 Landlord s Expense Responsibility $45,824.45 NET OPERATING INCOME $257,280.57 TOTAL RETURN 7.19% / $257,280.57 CURRENT OPERATING EXPENSES EXPENSE TOTAL Property Taxes $40,844.94 Fixed $35.51 Total Property Tax $40,880.45 Liability Insurance $3,600.00 Reserves $1,344.00 TOTAL $45,824.45 *The cap rate and base rent reflect the scheduled rent increase on 9/1/2015.

FINANCIAL OVERVIEW RENT ROLL TENANT NAME TENANT SIZE PRO RATA SHARE LEASE COMM. LEASE EXP. MONTHLY RENT MONTHLY RENT/SF ANNUAL RENT ANNUAL RENT/SF INCREASE DATE INCREASED MONTHLY RENT TYPE OF INCREASE OPTIONS TYPE OF LEASE USA LIVING 19,200 100.00% 9/1/2013 8/31/2023 $24,523.06 $1.28 $294,276.72 $15.33 9/1/2015 $25,258.75 3.00% 2-Five Year Modified Gross TOTAL RENTABALE AREA 19,200 100% LEASE TERM CASHFLOW TENANT 9/15 9/16 9/17 9/18 9/19 9/20 9/21 9/22 Total RENT $303,105.02 $312,198.17 $321,564.12 $331,211.04 $341,147.37 $351,381.79 $361,923.25 $372,780.94 $2,695,311.70 EXPENSES $45,824.45 $46,740.94 $47,675.76 $48,629.27 $49,601.86 $50,593.90 $51,605.77 $52,637.89 $393,309.84 NOI $257,280.57 $265,457.23 $273,888.36 $282,581.77 $291,545.51 $300,787.90 $310,317.47 $320,143.05 $2,302,001.86 PURCHASE PRICE $3,580,000.00 $3,580,000.00 $3,580,000.00 $3,580,000.00 $3,580,000.00 $3,580,000.00 $3,580,000.00 $3,580,000.00 - CAP RATE 7.19% 7.42% 7.65% 7.89% 8.14% 8.40% 8.67% 8.94% - *Expenses are forecasted to grow two percent annually.

TENANT OVERVIEW Tenant Name Property Address Property Type USA Living 476 Broadway Chula Vista, CA 91910 Single-Tenant Retail Square Feet 19,200 Number of Locations 31 Headquartered Virginia Beach, VA Website www.usaliving.com Tenant Trade Name Ownership Tenant Guarantee USA Living Private Corporate Corporate Lease Commencement 09/01/2013 Rent Commencement 09/01/2013 Lease Expiration 08/31/2023 Term Remaining Lease Type Roof & Structure Lease Term Increases 8.5 Years Modified Gross Landlord Responsible for Roof Memabrane and Bearing Wall/ Tenant Responsible for Maintenance Repair 10-Year 3% Annually USA Living is a group of 24 specialty retail stores spanning 12 states and Washington, DC all dedicated to making it easier to buy brand-name products with the help of flexible credit options. Here you ll find everything you need to live the life you want from stylish furniture, top appliances and big-screen TVs to computers, smartphones, jewelry and more. Options to Renew First Right of Refusal Two, 5-Year Yes

LEASE SUMMARY Tenant Responsibilities Landlord Responsibilities Taxes Insurance Utilities & Service Contracts Assignment & Subletting Estoppel Lessee shall, at Lessee s sole expense, keep the premises, utility installations and alteration in good order, condition and repair including, but not limited to, all equipment or facilities, such as plumbing HVAC equipment, electrical, lighting facilities, boilers, pressure vessels, fire protection, fixtures, walls (interior and exterior), ceilings, floors, windows, doors, plate glass, skylights, landscaping, driveways, parking lots, fences, retaining walls, signs, sidewalks, and parkways. Lessee, in keeping the Premise in good order, condition and repair, shall exercise and perform good maintenance practices, specifically including the procurement and maintenance of the service contracts required. Lessee shall, during the term of the lease, keep the exterior appearance of the building in a first-class condition (including e.g. graffiti removal). Lessor shall be responsible for the surface and structural elements of the roof, foundation and bearing walls. Lessor shall be fully responsible for all real estate taxes and assessments on the property. Lessor shall maintain liability insurance in addition to, and not in lieu of, the insurance required to be maintained by Lessee. Lessee shall not be named as an additional insured therein. Lessee shall pay for all water, gas, heat, light, power, telephone, trash disposal and other utilities and services supplied to the Premises. Lessee shall, at Lessee s sole expense, procure and maintain contracts in the maintenance of the following equipment and improvements: HVAC, boiler and pressure vessels, fire extinguishing systems, landscaping and irrigation system. Lessee shall not assign or sublet any interest without Lessor s consent. Within 10 calendar days upon written notice.

INVESTMENT OVERVIEW Located Catty-Corner to Chula Vista Center, an 875,000-Square Foot Mall Anchored by AMC Theaters, JCPenney, Sears and Macy s Fixed Three Percent Annual Increase Throughout the Lease Term Including Options Approximately $72,000 Increase in Base Rent by 2023: Over $2.6 Million in Rent Collection Remaining in the Original Term Core Location: Positioned Almost Steps from Retail Area Daily Car Count Exceeds 65,000 Cars Per Day: 1/4 Mile from the Interstate 5 Freeway Well Below Market Rent; Current Rent is 27 Percent Below Area Average of $1.80 NNN Marcus & Millichap is pleased to present USA Living in Chula Vista, California. USA Living occupies a 19,200-square foot freestanding building on 0.74 acres, including 32 parking stalls, and has 8.5 years remaining on a 10-year gross lease. There are three percent annual increases, including throughout each of the two, 5-year renewal options. The property is strategically located at the signalized intersection of Broadway and H Street with a combined traffic count of 65,000 cars per day. The population has increased 12 percent since 2000 and is expected to experience continued growth of 16 percent over the next five years. The property is surrounded by several large retail outlets including the newly renovated Chula Vista Center, an 875,000 square-foot enclosed shopping mall with over 100 stores, anchored by AMC, JC Penney, Sears and Macy s. Chula Vista is the second largest city in the San Diego metropolitan area, the seventh largest city in Southern California, the fourteenth largest city in the state of California. Located just 7.5 miles from downtown San Diego and 7.5 miles from the Mexican border in the South Bay region of the metropolitan area, the city is at the center of one of the richest economic and culturally diverse zones in the United States. Chula Vista is also named because of its scenic location between the San Diego Bay and coastal mountain foothills. Founded in the early 19th century, fast population growth has recently been observed in the city. Located in the city is one of America s few year-round United States Olympic Training centers and popular tourist destinations include SleepTrain Amphitheatre, the Chula Vista marina, and the Living Coast Discovery Center, formerly known as the Chula Vista Nature Center.

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CHULA VISTA BAYFRONT DEVELOPMENT The vision shared by the Port of San Diego and the City of Chula Vista to redevelop Chula Vista s bayfront has won a prestigious award from the North American Strategic Infrastructure Leadership Forum. The award recognizes the plan s projected impact on job creation and business growth. The Chula Vista Bayfront Master Plan tied with an Indiana public-works project for first place as Job/Opportunity Creation Project of the Year the 2012 Strategic Infrastructure Projects of the Year for North America. The award was announced Tuesday, October 16 at the 4th Annual Strategic Infrastructure Leadership Forum in Denver, Colorado. The master plan for the more than 550 acres on the Chula Vista bayfront was developed in equal partnership with the Port of San Diego and City of Chula Vista. The plan received unanimous California Coastal Commission approval in August 2012 and officials are conducting outreach to potential developers and investors. Our vision for the Chula Vista bayfront was developed with extensive community input, and has broad support because it balances economic development with public access and environmental stewardship, said Ann Moore, Vice Chair of the Board of Port Commissioners and the City of Chula Vista s representative on the board. We look forward to the many benefits including thousands of new jobs that the project will bring to the San Diego region. The Chula Vista plan envisions a world-class destination - hotels, homes, shops, restaurants and 234 acres of parks and nature preserve. The project is projected to create thousands of jobs (7,000 construction; 2,200 permanent), transform the bayfront, and generate revenue for public services like police, fire protection and parks. This award validates some of our top priorities for the Chula Vista bayfront creating good jobs and fostering economic development, said Chula Vista Mayor Cheryl Cox. Experts from across North America have recognized the economic benefits this project will bring to the San Diego region. The Leadership Forum is the premier strategic infrastructure projects event in North America, featuring the Top 100 infrastructure projects with a total value of over $440 billion. Project of the Year awards are given in five categories including job/opportunity creation, green planning, technical engineering, innovative finance model and strategic planning. Nominees are all projects that are planned for the very near future, and demonstrate the imagination and technical skills of their developers, inspiring people from around the region with new ideas and paradigms for infrastructure project development.

DEMOGRAPHIC REPORT POPULATION 1-MILE 3-MILES 5-MILES 2000 Population 27,738 131,224 385,067 2010 Population 28,762 137,886 407,101 2013 Population 29,753 142,522 420,954 2018 Population 29,879 143,821 429,518 HOUSEHOLDS 1-MILE 3-MILES 5-MILES 2000 Households 10,446 45,575 114,280 2010 Households 10,178 45,232 118,131 2013 Households 10,609 47,042 122,843 2018 Households 10.621 47,440 125,564 2012 Average Household Size 2.76 3.01 3.28 2013 Daytime Population 14,990 49,917 99,059 2000 Owner Occupied Housing Units 28.12% 42.45% 48.98% 2000 Renter Occupied Housing Units 69.02% 54.52% 48.03% 2000 Vacant 2.86% 3.03% 2.99% 2013 Owner Occupied Housing Units 25.94% 39.81% 46.69% 2013 Renter Occupied Housing Units 74.06% 60.19% 53.31% 2013 Vacant 1.93% 2.49% 2.27% 2018 Owner Occupied Housing Units 25.80% 39.63% 45.56% 2018 Renter Occupied Housing Units 74.20% 60.37% 53.44% 2018 Vacant 1.96% 2.60% 2.37% INCOME 1-MILE 3-MILES 5-MILES $ 0 - $14,999 20.30% 15.60% 12.70% $ 15,000 - $24,999 17.30% 14.60% 12.50% $ 25,000 - $34,999 14.30% 13.00% 11.90% $ 35,000 - $49,999 17.20% 15.70% 15.10% $ 50,000 - $74,999 14.70% 16.30% 18.10% $ 75,000 - $99,999 8.40% 10.40% 12.50% $100,000 - $124,999 3.60% 5.80% 7.20% $125,000 - $149,999 1.80% 3.60% 3.50% $150,000 - $199,999 1.30% 2.70% 3.50% $200,000 - $249,999 0.40% 0.90% 1.10% $250,000 + 0.70% 1.30% 1.60% 2013 Median Household Income $33,624 $41,133 $47,705 2013 Per Capita Income $16,633 $20,307 $19,861 2013 Average Household Income $45,661 $59,029 $65,612

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