Mesquite, Texas Wyoming, Michigan 6 Unit Zero Cash Flow Portfolio Offering Memorandum 1 Representative Photo
Exclusively Listed By BILL PEDERSEN National Drug Store Specialist bill.pedersen@matthews.com DIR (949) 432-4501 MOB (831) 246-0646 LIC NO. 01975700 KYLE MATTHEWS Chairman & CEO kyle.matthews@matthews.com LIC NO. 01469842 KYLE MATTHEWS BROKER OF RECORD (TX) License No. 678067 KARL NORWOOD BROKER OF RECORD (NH) License No. 6788 DON MORTENSON BROKER OF RECORD (AZ) License No. LC635678000 GILLIAN GREENFIELD BROKER OF RECORD (WV) License No. WV0026307 KYLE MATTHEWS BROKER OF RECORD (VA) License No. 226027771 KYLE MATTHEWS BROKER OF RECORD (MI) License No. 6505399495 2
Table of Contents 4 Investment Summary 7 5 Financial Highlights The Offerings Mesquite, Texas...8 Gilford, New Hampshire...10 Dunbar, West Virginia...12 Lynchburg, Virginia...14 Surprise, Arizona...16 Wyoming, Michigan...18 6 Tenant Report 3
Investment Summary Investment Overview Bill Pedersen and Kyle Matthews of Matthews Real Estate Investment Services are pleased to offer for sale a portfolio of six zero cash flow. All subject properties are 100% leased to Pharmacy and are operating under absolute NNN leases. The portfolio must be kept together, stores cannot be sold off individually. Investment Highlights Dunbar, West Virginia Wyoming, Michigan Zero Cash Flow Financing: Individual loans on each property; coterminous and assumable zero cash flow debt with a second mortgage in place Original 25 year Leases: ±11.75 years remaining on original term plus 10 renewal options No Phantom Income: Interest payments on second mortgage are greater than principal payments for the remainder of the term High leverage: Only a 12% equity requirement Absolute NNN Leases: Zero landlord responsibilities Strong Locations for Ideal 1031 Exchange Properties Strong Credit Tenant Investment grade credit (S&P Rated BBB+, Moody s Baa1), second largest retail pharmacy in the US with over 9,600 locations, Fortune 500 company - Ranked #7 in 2016, Health is the largest retailer of prescription drugs and the second-largest pharmacy benefits manager in the U.S. 4 6 Unit Portfolio 4
Financial Highlights Surprise, AZ Wyoming, MI Gilford, NH Mesquite, TX Lynchburg, VA Dunbar, WV Store No. 5477 8306 863 5869 4285 4244 Portfolio List Price $3,680,375 $2,980,566 $2,837,165 $3,075,610 $2,988,242 $2,501,574 $18,063,533 % over debt 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% Equity required $394,326 $319,346 $303,982 $329,530 $320,169 $268,026 $1,935,379 Financial Information - 1st Mortgage & Mezz Total Outstanding Principal Balance (as of 10/10/2017) $3,286,049 $2,661,219 $2,533,183 $2,746,080 $2,668,074 $2,233,549 $16,128,155 Maturity Date 1/10/2026 1/10/2026 1/10/2026 1/10/2026 1/10/2026 1/10/2026 Balloon Payment $3,230,325 $2,616,091 $2,490,226 $2,669,511 $2,622,829 $2,195,671 $15,824,654 Balloon Due Date 1/31/2029 1/31/2029 1/31/2029 1/31/2029 1/31/2029 1/31/2029 Rent Holiday Lease Information Three (3) year rent holiday beginning 1/10/26 Three (3) year rent holiday beginning 1/10/26 Three (3) year rent holiday beginning 1/10/26 Three (3) year rent holiday beginning 1/10/26 Three (3) year rent holiday beginning 1/10/26 Three (3) year rent holiday beginning 1/10/26 Base Rent $285,056 $230,853 $219,747 $238,215 $231,448 $193,754 $1,399,073 Rent Commencement 1/10/2004 2/10/2004 2/10/2004 2/10/2004 2/10/2004 2/10/2004 Lease Expiration 1/31/2029 1/31/2029 1/31/2029 1/31/2029 1/31/2029 1/31/2029 Remaining Lease Term (years) Renewal Options 11.75 11.75 11.75 11.75 11.75 11.75 Ten (10) five (5) year extension periods (at FMV) Ten (10) five (5) year extension periods (at FMV) Ten (10) five (5) year extension periods (at FMV) Ten (10) five (5) year extension periods (at FMV) Ten (10) five (5) year extension periods (at FMV) Ten (10) five (5) year extension periods (at FMV) Year Built 2006 TBD 2003 2003 2003 2003 GLA (SF) 13,069 TBD TBD 13,091 12,200 11,500 Land (AC) 2.04 0.95 2.97 1.52 1.13 1.25 5 Offering Memorandum 5
Tenant Report TENANT OVERVIEW Health Corporation, together with its subsidiaries, provides integrated pharmacy health care services. It operates through Pharmacy Services and Retail/LTC segments. The Pharmacy Services segment offers pharmacy benefit management solutions, such as plan design and administration, formulary management, Medicare Part D services, mail order and specialty pharmacy services, retail pharmacy network management services, prescription management systems, clinical services, disease management programs, and medical pharmacy management services. The Retail/LTC segment sells prescription drugs, over-the-counter drugs, beauty products and cosmetics, personal care products, convenience foods, seasonal merchandise, and greeting cards, as well as provides photo finishing services. The company was formerly known as Caremark Corporation and changed its name to Health Corporation in September 2014. Hook-SupeRx, LLC operates as a subsidiary of Health Corporation and retails drugs in the United States. It is based in Indianapolis, Indiana and does business as Pharmacy. GEOGRAPHIC REACH drugstores span across 49 U.S. states, the District of Columbia, Brazil and Puerto Rico. The company also operates Longs Drugs banner in California, Hawaii, Nevada and Arizona. Around 1,000 store locations throughout 31 states and in Washington D.C. also have Minute Clinics. STRATEGY continues to evolve from being a general pharmacy store, expanding into more specialty fields of the fast-growing healthcare market. The company s Retail Pharmacy Store Development plan, which focuses on entering new markets, adding stores in existing markets, and relocating stores to more convenient sites, has been essential for business growth and in keeping up with Walgreens. has been successful in its ventures for its store count has increased from 7,388 stores at the end of 2011 to nearly 9,700 stores today. In addition to opening new stores, has made efforts to increase sales at existing ones. Prescription drugs account for more than two-thirds of its sales, and the retailer is attempting to grow revenues from over-the-counter medications and general merchandise through its growing private-label product offering. Property Name Property Type Net Leased Drug Store Company Trade Name Health Corporation (NYSE: ) Ownership Public Credit Rating (S&P) BBB+ No. of Locations ± 9,700 No. of Employees ± 243,000 Headquartered Woonsocket, Rhode Island Website www.cvs.com Year Founded 1963 6 6 Unit Portfolio 6
The Offerings 7 Offering Memorandum 7 Wyoming, Michigan
1413 Oates Drive Mesquite, TX 75150 Actual Site POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 14,262 147,735 330,109 2017 Estimate 13,378 138,993 310,252 2010 Census 12,369 129,187 287,638 2000 Census 11,307 123,491 274,912 8 6 Unit Portfolio HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 5,730 51,376 116,776 2017 Estimate 5,392 48,478 110,051 INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $63,286 $65,135 $64,930 8
Physical Description PROPERTY ADDRESS 1413 Oates Drive LOCATION Mesquite, Texas BUILDING AREA (GLA) ± 13,091 SF LAND AREA ± 1.52 Acres YEAR BUILT 2003 Tenant Summary NUMBER OF STORIES 1 APN 38-14290-005-01R-00-00 ZONING TBD PARKING 66 Spaces PARKING RATIO 5.04/1,000 SF Actual Site TENANT TRADE NAME TYPE OF OWNERSHIP Fee Simple LEASE TYPE Absolute NNN ROOF AND STRUCTURE Tenant Responsible TERM REMAINING ± 11.75 Years INCREASES Fair Market Value (In Options) LEASE GUARANTOR Corporate Store Information ORIGINAL LEASE TERM 25 Years Options Ten (10), Five (5) Year Options STORE NUMBER 5869 24 HOUR STORE No MINUTE CLINIC Yes DRIVE-THRU Yes 9 Offering Memorandum 9
1371 Lakeshore Drive Gilford, NH 03249 Representative Photo POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 1,198 16,978 24,908 2017 Estimate 1,185 16,805 24,710 2010 Census 1,180 16,687 24,643 2000 Census 1,236 16,818 24,518 10 6 Unit Portfolio HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 552 7,518 10,807 2017 Estimate 540 7,376 10,644 INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $84,745 $80,031 $80,911 10
Physical Description PROPERTY ADDRESS 1371 Lakeshore Drive LOCATION Gilford, New Hampshire BUILDING AREA (GLA) TBD LAND AREA ± 2.97 Acres YEAR BUILT 2003 Tenant Summary TENANT TRADE NAME TYPE OF OWNERSHIP Fee Simple NUMBER OF STORIES 1 APN GIFL M:201 B:033 L:00 ZONING TBD PARKING 76 Spaces PARKING RATIO TBD LEASE TYPE NNN ROOF AND STRUCTURE Tenant Responsible Representative Photo TERM REMAINING ± 11.75 Years INCREASES Fair Market Value (In Options) LEASE GUARANTOR Corporate Store Information ORIGINAL LEASE TERM 25 Years Options Ten (10), Five (5) Year Options STORE NUMBER 863 24 HOUR STORE No MINUTE CLINIC No DRIVE-THRU Yes 11 Offering Memorandum 11
121 10th Street Dunbar, West Virginia 25064 Actual Site POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 9,273 26,814 61,831 2017 Estimate 9,555 27,269 63,113 2010 Census 10,124 28,093 65,461 2000 Census 10,743 28,795 67,525 12 6 Unit Portfolio HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 4,386 12,141 27,391 2017 Estimate 4,519 12,319 27,890 INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $53,296 $57,897 $62,659 12
Physical Description PROPERTY ADDRESS 121 10th Street LOCATION Dunbar, West Virginia BUILDING AREA (GLA) ± 11,500 SF LAND AREA ± 1.25 Acres YEAR BUILT 2003 Tenant Summary NUMBER OF STORIES 1 APN 20-26- 12-0335.0000 ZONING TBD PARKING 50 Spaces PARKING RATIO 4.35/1,000 SF Actual Site TENANT TRADE NAME TYPE OF OWNERSHIP Fee Simple LEASE TYPE NNN ROOF AND STRUCTURE Tenant Responsible TERM REMAINING ± 11.75 Years INCREASES Fair Market Value (In Options) LEASE GUARANTOR Corporate Store Information ORIGINAL LEASE TERM 25 Years Options Ten (10), Five (5) Year Options STORE NUMBER 4244 24 HOUR STORE No MINUTE CLINIC No DRIVE-THRU Yes 13 Offering Memorandum 13
21550 Timberlake Road Lynchburg, VA 24502 Representative Photo POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 5,933 34,221 70,708 2017 Estimate 5,731 32,383 66,582 2010 Census 5,542 29,891 60,823 2000 Census 4,843 24,064 45,778 14 6 Unit Portfolio HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 2,548 14,480 26,357 2017 Estimate 2,456 13,705 24,834 INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $58,747 $68,135 $69,875 14
Physical Description PROPERTY ADDRESS 21550 Timberlake Road LOCATION Lynchburg, Virginia BUILDING AREA (GLA) ± 12,200 SF LAND AREA ± 1.1 Acres YEAR BUILT 2003 Tenant Summary TENANT TRADE NAME TYPE OF OWNERSHIP Fee Simple NUMBER OF STORIES 1 APN 21A 1 5 ZONING B-GC, C PARKING 54 Spaces PARKING RATIO 4.43/1,100 SF LEASE TYPE NNN ROOF AND STRUCTURE Tenant Responsible Representative Photo TERM REMAINING ± 11.75 Years INCREASES Fair Market Value (In Options) LEASE GUARANTOR Corporate Store Information ORIGINAL LEASE TERM 25 Years Options Ten (10), Five (5) Year Options STORE NUMBER 4285 24 HOUR STORE Yes MINUTE CLINIC No DRIVE-THRU Yes 15 Offering Memorandum 15
13870 West Greenway Road Surprise, AZ 85374 Representative Photo POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 19,631 132,643 252,948 2017 Estimate 17,615 120,194 230,678 2010 Census 14,494 100,624 195,334 2000 Census 1,507 37,330 85,632 16 6 Unit Portfolio HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 6,002 45,512 100,442 2017 Estimate 5,466 41,689 92,712 INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $73,183 $65,801 $64,166 16
Physical Description PROPERTY ADDRESS 13870 West Greenway Road LOCATION Surprise, Arizona BUILDING AREA (GLA) ± 13,069 SF LAND AREA ± 2.04 Acres YEAR BUILT 2006 Tenant Summary TENANT TRADE NAME TYPE OF OWNERSHIP Fee Simple NUMBER OF STORIES 1 APN 501-16-987 ZONING TBD PARKING 58 Spaces PARKING RATIO 4.44/1,000 SF LEASE TYPE NNN ROOF AND STRUCTURE Tenant Responsible Representative Photo TERM REMAINING ± 11.75 Years INCREASES Fair Market Value (In Options) LEASE GUARANTOR Corporate Store Information ORIGINAL LEASE TERM 25 Years Options Ten (10), Five (5) Year Options STORE NUMBER 5477 24 HOUR STORE No MINUTE CLINIC No DRIVE-THRU Yes 17 Offering Memorandum 17
2375 28th Street SW Wyoming, MI 49519 Actual Site POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 12,486 87,522 251,952 2017 Estimate 11,732 82,973 238,530 2010 Census 10,762 77,594 220,125 2000 Census 9,743 73,430 200,082 18 6 Unit Portfolio HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 5,480 35,984 100,892 2017 Estimate 5,154 34,178 95,755 INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $65,738 $77,299 $82,526 18
Physical Description PROPERTY ADDRESS 2375 28th Street SW LOCATION Wyoming, Michigan BUILDING AREA (GLA) TBD LAND AREA ± 0.95 Acres YEAR BUILT 2003 Tenant Summary TENANT TRADE NAME TYPE OF OWNERSHIP Fee Simple NUMBER OF STORIES 1 APN 41-17-10-359-017 ZONING TBD PARKING 40 Spaces PARKING RATIO TBD LEASE TYPE NNN ROOF AND STRUCTURE Tenant Responsible Actual Site TERM REMAINING ± 11.75 Years INCREASES Fair Market Value (In Options) LEASE GUARANTOR Corporate Store Information ORIGINAL LEASE TERM 25 Years Options Ten (10), Five (5) Year Options STORE NUMBER 8306 24 HOUR STORE No MINUTE CLINIC No DRIVE-THRU Yes 19 Offering Memorandum 19
CONFIDENTIALITY & DISCLAIMER STATEMENT This Offering Memorandum contains select information pertaining to the business and affairs of the Properties in this portfolio. It has been prepared by Matthews Real Estate Investment Services. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews Real Estate Investment Services. The material is based in part upon information supplied by the Seller and in part upon financial information obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty, express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence. By acknowledging your receipt of this Offering Memorandum for the Property, you agree: 1. The Offering Memorandum and its contents are confidential; 2. You will hold it and treat it in the strictest of confidence; and 3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Seller. Owner and Matthews Real Estate Investment Services expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered. If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum. A prospective purchaser s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or Matthews Real Estate Investment Services or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property. This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum. 20 6 Unit Portfolio 20
BILL PEDERSEN National Drug Store Specialist bill.pedersen@matthews.com DIR (949) 432-4501 MOB (831) 246-0646 LIC NO. 01975700 KYLE MATTHEWS BROKER OF RECORD (TX) License No. 678067 GILLIAN GREENFIELD BROKER OF RECORD (WV) License No. WV0026307 KARL NORWOOD BROKER OF RECORD (NH) License No. 6788 KYLE MATTHEWS BROKER OF RECORD (VA) License No. 226027771 KYLE MATTHEWS Chairman & CEO kyle.matthews@matthews.com LIC NO. 01469842 DON MORTENSON BROKER OF RECORD (AZ) License No. LC635678000 KYLE MATTHEWS BROKER OF RECORD (MI) License No. 6505399495 21 Offering Memorandum 21