South Hills shopping center

South Hills shopping center A neighborhood shopping center 5990 South Land Park Drive, Sacramento, CA 95822 Dave Lucas dlucas@capitalpacific.com [415] 274-7390 CA DRE#: 01389761 Chris Kostanecki ck@capitalpacific.com [415] 274-2701 CA DRE#: 01002010 Zeb Ripple zripple@capitalpacific.com [415] 274-2702 CA DRE#: 01242540 Chris Peters cpeters@capitalpacific.com [415] 274-2703 CA DRE#: 01339983

SEASONED, HIGH-YIELD SACRAMENTO SHOPPING CENTER WITH DEVELOPMENT OPPORTUNITY/UPSIDE Investment Highlights PRICE: $4,325,000 CAP: 7.76% NOI.... $335,545 RENTABLE SF.... 54,206 SF LAND AREA... 5.36 Acres PPSF.... $79.79 BUILT/RENOVATED... 1957 / 2004 OCCUPANCY.... 84.35% INVESTMENT HIGHLIGHTS: DESIRABLE RETAIL MARKET, STRONG INCOMES >Multi-tenant strip retail center in the Land Park Area of Sacramento >Center was constructed in the 1950 s and renovated in 2004 >Seller of the property originally developed the center REPOSITIONING OPPORTUNITIES Anchored by USPS Main Branch in a slightly less than 16,000 square feet space, lease expires in 2015, one remaining five year option, fixed annual bumps. > Remaining tenants are either month to month or expire within eighteen months offering a buyer the option to renegotiate long term leases or reposition the center ATTRACTIVE, WELL MAINTAINED > Professionally managed long-term with well-kept exterior. Bay depths allow either inline smaller tenant suite or could be collapsed to create large junior box size spaces. > Sizeable parking field and multiple access points/curb cuts to maintain efficient ingress/egress. This offering represents the opportunity for an investor to acquire a stable retail strip center with development/leasing upside in a demographically desirable mature Sacramento submarket. SOUTH HILLS SHOPPING CENTER 2

Core Characteristics INVESTMENT HIGHLIGHTS: >Multi-purpose, easily devisable buildings with at or below market rents represents stable income stream or possible future upside potential >Land Park has strong demographics and is immediately east of the very desirable Pocket area of Sacramento >Most tenants have been at the center long term >Shadow anchored by Vic s IGA market, an independent local grocer >Unique, true infill neighborhood shopping center location with limited immediate competition >Parking lot re-stripping to be completed in December 2013; Ample parking field in front and rear of building >No use restrictions at center >Varying access points/curb cuts allow for varying configurations/redevelopment options at vacant building >Vacant 8,400 SF pad building represents immediate leasing or development upside for new owner >Site plan lends to multiple reconfiguration scenarios that could include collapsing suites into junior box type spaces >Multiple month to month leases offer immediate leasing upside; USPS lease has annual bumps SOUTH HILLS SHOPPING CENTER 3

Income & Expense Price: $4,325,000 $4,471,297 PROPOSED LOAN SCENARIO: Capitalization Rate: 7.76% 8.55% Loan Amount $2,811,250 Price Per Square Foot: $79.79 $82.49 Interest Rate 4.75% Down Payment 35% $1,513,750 $1,564,954 Amortization 25 Year Loan Amount 65% $2,811,250 $2,906,343 Term 7 Year Total Leased (SF): 84.35% 45,725 54,206 Debt Service $192,329 Total Vacant (SF): 15.65% 8,481 - Monthly Debt Service $16,027 Total Rentable Area (SF): 54,206 54,206 Pre-Tax Cash Flow $143,216 INCOME Per Square Foot Debt Coverage Ratio 1.74 Scheduled Rent $7.69 $416,724 $416,724 Pre-Tax Leveraged Cash-on-cash 9.46% Projected Rent on Pad ($9/sf) $9.00 $76,329 Principal Paydown (Year 1) $60,092 CAM Recovery $1.49 $80,969 $94,272 Total Return $203,308 Increased Property Tax Recovery $0.25 $13,303 Yield 13.43% EFFECTIVE GROSS INCOME $510,996 $587,325 Market Vacancy Reserve (5%) ($29,366) ADJUSTED GROSS INCOME $510,996 $557,958 EXPENSES Per Square Foot Lease Up Costs Taxes (1.1% of purchase price) -$0.88 ($47,575) ($47,575) Tenant Improvements ($15/sf) $127,215 Insurance (2012) -$0.48 ($25,983) ($25,983) Leasing Commission (25% of Y1) $19,082 Utilities (2012) -$0.69 ($37,423) ($37,423) Administrative (2012) -$0.02 ($829) ($829) Total Lease Up Costs $146,297 Fire/Life Safety (2012) -$0.11 ($5,755) ($5,755) Janitorial (Cleaning) 2012) -$0.31 ($16,744) ($16,744) Landscaping (2012) -$0.12 ($6,300) ($6,300) Repairs & Maintenance ($0.20/Sf) -$0.20 ($10,841) ($10,841) Management (2012) -$0.44 ($24,000) ($24,000) TOTAL OPERATING EXPENSES -$3.24 ($175,450) ($175,450) NET OPERATING INCOME $335,545 $382,508 CONVENTIONAL FINANCING This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies. SOUTH HILLS SHOPPING CENTER 4

Rent Roll Tenant Use Unit # Sq. Ft. Percent of GLA Lease Start Lease Expiration Monthly Base Rent Monthly Rent/SF Annual Rent/SF Annual Rent 2011 CAM/SF Total CAM Florez Bar and Grill* Restaurant 5900 3,114 5.74% 11/01/05 12/31/11 $4,000.00 $1.28 $15.41 $48,000 $0.00 $0.00 South Hills Hair Studio Service 5908 790 1.46% 05/01/05 05/31/15 $1,027.00 $1.30 $15.60 $12,324 $3.56 $2,812.40 Mike's Liquor Merchandise 5916 2,108 3.89% 01/01/11 12/31/15 $1,950.00 $0.93 $11.10 $23,400 $3.75 $7,905.00 Giovanni's Pizzeria* Restaurant 5924 7,934 14.64% 4/1/2006 3/31/2011 $4,500.00 $0.57 $6.81 $54,000 $1.13 $8,965.42 US Post Office Service 5930 15,791 29.13% 9/21/2000 9/21/2015 $11,101.00 $0.70 $8.44 $133,212 $0.00 $0.00 9/21/2014 9/21/2015 $11,434.08 $0.72 $8.69 $137,209 9/21/2015 9/21/2016 $11,777.08 $0.75 $8.95 $141,325 9/21/2016 9/21/2017 $12,130.42 $0.77 $9.22 $145,565 Third 5 year Option - Fixed increases 9/21/2017 9/21/2018 $12,494.25 $0.79 $9.49 $149,931 9/21/2018 9/21/2019 $12,869.08 $0.81 $9.78 $154,429 9/21/2019 9/21/2020 $13,255.17 $0.84 $10.07 $159,062 Kombat Soccer* Merchandise 5958 2,500 4.61% 9/1/2002 8/31/2013 $2,700.00 $1.08 $12.96 $32,400 $3.86 $9,650.00 Land Park Business Merchandise 5960 2,500 4.61% 11/1/2001 12/31/2015 $2,250.00 $0.90 $10.80 $27,000 $3.71 $9,275.00 Jazzercise* Service 5962 4,100 7.56% 10/1/2004 12/31/2013 $2,700.00 $0.66 $7.90 $32,400 $3.86 $15,826.00 Beverly's Unique Merchandise 5964 2,900 5.35% 3/1/2011 2/28/2014 $1,000.00 $0.34 $4.14 $12,000 $3.86 $11,194.00 D&P Cards* Merchandise 5968 708 1.31% 6/1/2008 5/31/2011 $500.00 $0.71 $8.47 $6,000 $3.84 $2,718.72 Advance Computer Merchandise 5972 880 1.62% 12/1/2003 12/31/2014 $484.00 $0.55 $6.60 $5,808 $3.85 $3,388.00 Heads Up Salon Service 5974 600 1.11% 8/1/2003 8/31/2014 $720.00 $1.20 $14.40 $8,640 $3.84 $2,304.00 Future Insurance Service 5978, 5982 1,800 3.32% 10/1/2004 8/31/2013 $1,795.00 $1.00 $11.97 $21,540 $3.85 $6,930.00 Vacant 5990 8,481 15.65% Rent Recoverables Current Totals: 54,206 100.00% Montly $34,727 Annual $416,724 Occupied 45,725 84.35% $416,724 Total CAM $80,968.54 Vacant 8,481 15.65% * signifies Month to Month Tenancy This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies. SOUTH HILLS SHOPPING CENTER 5

50 99 99 5 Sacramento Charter High School ou nb rso Christian Brothers High School oad ville R r Je Sutte rd WILLIAM LAND GOLF COURSE River City High School leva Bou lev ar d California Middle School kton ffe 50 Stoc CK McClatchy High School Oak Ridge 84 99 Sam Brannan Middle School Leonardo Da Vinci K-8 School John Cabrillo John F. Kennedy High School STOCKRIDGE PLAZA West Campus High School Hollywood Park Fruitridge Road DAIL Y S La nd P ark D r Alice Birney Maple Elementary School Ethel I. Baker leva SACRAMENTO EXECUTIVE AIRPORT Bou FLORIN TOWNE CENTER port 5 43 Avenrd ue rd 8,345 Camillia Waldorf School SOUTHGATE PLAZA Free Pony Express St. Hope Public School ive SOUTH HILLS SHOPPING CENTER Mark Twain BING MALONEY GOLF COURSE LAKE CREST VILLAGE John Morse-Oak Ridge Waldorf Florin Road Florin Road RIVER OAKS SHOPPING CENTER 99 SOUTH HILLS SHOPPING CENTER 6

Site Plan VACANT FUTURE INSURANCE FUTURE INSURANCE HEADS UP SALON ADVANCE COMPUTER D&P CARDS BEVERLY S UNIQUE JAZZERCISE KOMBAT SOCCER LAND PARK BUSINESS GIOVANNI S PIZZERIA MIKE S LIQUOR SOUTH HILLS FLOREZ BAR AND GRILL South Land Park Drive FLEXIBLE SITE PLAN AND LARGE PARCEL WITH AMPLE PARKING SOUTH HILLS SHOPPING CENTER 7

Close Aerial SOUTH HILLS SHOPPING CENTER 8

Site Plan SOUTH HILLS SHOPPING CENTER 9

Photos PROFESSIONALLY MANAGED AND MAINTAINED SOUTH HILLS SHOPPING CENTER 10

Regional Map Aspen SOUTH HILLS SHOPPING CENTER SOUTH HILLS SHOPPING CENTER 11

Sacramento, CA Sacramento, the state capital of California, is located along the Sacramento River and just south of the American River s confluence in California s expansive Central Valley. With a 20102 estimated population of 475,516, it is the sixth-largest city in California. Sacramento is the core cultural and economic center of the Sacramento Metropolitan Area which includes El Dorado, Placer, Sacramento, and Yolo counties and has a combined population of approximately 2,927,123. California State University, Sacramento, more commonly known as Sacramento State or Sac State, is the major local university. It is one of the twenty-three campuses of the California State University system. In addition, the University of California, Davis is located in nearby Davis, 15 miles west of the capital. The UC Davis Medical Center, a world-renowned research hospital, is located in the city of Sacramento. The city s major employers are widely dominated by the local and state government and local health systems. The major employers include the State of California, Sacramento County, UC Davis Health System, Kaiser Permanente, Sutter Health Sacramento City Unified School District, Elk Grove Unified School District, Intel, Mercy/Catholic Healthcare West and San Juan Unified School district. Demographics Population 1 Mile 3 Miles 5 Miles 2010 Population 14,124 126,657 299,984 2012 Population 14,368 128,614 305,560 2017 Population (Projection) 14,990 133,844 318,651 2012 Income 2012 Average Household Income $72,273 $76,379 $64,229 2012 Median Household Income $52,102 $55,298 $45,315 Top Employers in Sacramento Employer # of Employee (Approx.) State of California 69,763 Sacramento County 11,450 UC Davis Health System 7,725 Dignity Health/Catholic Healthcare West 7,069 Intel 6,633 SOUTH HILLS SHOPPING CENTER 12

A unique HUMAN RESULTS-DRIVEN client experience THE CAPITAL PACIFIC EXPERIENCE - OUR DAILY COMMITMENT TO OUR CLIENTS [ www.capitalpacific.com ] Copyright 2013 [Capital Pacific Real Estate Brokerage Company] DAVE LUCAS dlucas@capitalpacific.com (415) 274-7390 CA DRE#: 01389761 CHRIS KOSTANECKI ck@capitalpacific.com (415) 274-2701 CA DRE#: 01002010 ZEB RIPPLE zripple@capitalpacific.com (415) 274-2702 CA DRE#: 01242540 CHRIS PETERS cpeters@capitalpacific.com (415) 274-2703 CA DRE#: 01339983 Copyright 2013 [Capital Pacific Real Estate Brokerage Company]