offering memorandum Net Leased Walgreens 204 Jonesboro Road

offering memorandum Net Leased Walgreens 204 Jonesboro Road McDonough, GA 30253

Table of Contents 01 EXECUTIVE SUMMARY Investment Summary Location and Demographics Property Aerials Property Overview 03 Market overview McDonough, Georgia Detailed Demographics Competing Properties Sold Comparables 02 Tenant Overview Tenant Summary Rent Roll 04 financial Overview Summary Cash Flow Model contact SEAN W. PATRICK, CCIM Vice President, Investment Sales 770.913.3946 spatrick@ackermanco.net Ackerman & Co. 10 Glenlake Parkway South Tower, Suite 1000 770.913.3900 ackermanco.com

INFORMATION NOT WARRANTED This Offering Memorandum and any subsequent evaluation material you may be provided (collectively known as the Offering Memorandum ) is intended solely for your limited use in considering whether to pursue negotiations to acquire Walgreens (the Property ) located at 204 Jonesboro Road in McDonough, Georgia. The Property is being marketed for sale by Ackerman & Co. ( Broker ). The Offering Memorandum contains brief, selected information pertaining to the business and affairs of the Property and has been prepared by Broker. It does not, however, purport to be all-inclusive or to contain all of the information that a prospective purchaser may desire. Broker makes no representation or warranty, express or implied, as to the accuracy or completeness of the Offering Memorandum or any of its contents, and no legal liability is assumed to be implied with respect thereto. By acknowledgment of your receipt of the Offering Memorandum you agree that the Offering Memorandum and its contents are confidential, that you will hold and treat it in the strictest of confidence, that you will not directly or indirectly disclose, or permit anyone else to disclose, the Offering Memorandum or its contents to any other person, firm, or entity (including, without limitation, any principal for whom you have been engaged), without prior written authorization of Owner or Broker and that you will not use or permit to be used the Offering Memorandum or its contents to be copied or used in any fashion or manner detrimental to the interest of Owner. Photocopy or other duplication is strictly prohibited. THE OFFERING MEMORANDUM SHALL NOT BE DEEMED TO REPRESENT THAT STATE OF AFFAIRS OF THE PROPERTY OR CONSTITUTE AN INDICATION THAT THERE HAS BEEN NO CHANGE IN THE BUSINESS OR AFFAIRS OF THE PROPERTY SINCE THE DATE OF PREPARATION OF THE OFFERING MEMORANDUM. The information provided in the Offering Memorandum has been gathered from sources that are deemed reliable, but the Broker does not warrant or represent that the information is true or correct. Prospective offerors are advised to verify information independently. The Offering Memorandum is not to be construed as an offer or as any part of a contract to sell the property. Furthermore, the inclusion or exclusion in the Offering Memorandum of information relating to asbestos or any other hazardous, toxic or dangerous chemical item, waste or substance (hereinafter collectively referred to as Waste ) relating to the Property shall in no way be construed as creating any warranties or representations, expressed or implied by the Broker as to the existence or nonexistence or nature of Waste in, under or on the Property, it may create significant legal and/or economic obligations upon the Owner, lessee and/or other holders of interest in the Property or a part thereof and you are hereby advised to obtain professional assistance such as from a consultant, engineer and/or attorney prior to taking an interest in the Property or a part thereof.

01 EXECUTIVE SUMMARY Investment Summary Location and Demographics Property Aerials Property Overview Net-Leased Walgreens

01 Executive Summary Net-Leased Walgreens 5 investment profile 204 Jonesboro Road McDonough, GA 30253 Ackerman & Co s Retail Investment Sales group is pleased to exclusively present for sale a double netleased Walgreens property located in McDonough, GA (Atlanta, GA MSA). The Walgreens property, originally constructed in 2001, includes a 15,120 SF building on approximately 1.92 acres. The offering provides stable cash flow, with just over 7 years of initial lease term remaining and eight 5-year options, from an investment-grade tenant; S&P: BBB/Stable rated tenant. This asset is fee simple and is being offered free and clear of debt. Square Footage: 15,120 SF Acreage: 1.92 acres Offering Price: $5,235,000 Price Per Square Foot: $346.00 Debt Structure: Market (offered free & clear) Lease Structure: NN (roof & structure) Cap Rate: 6.60% Lease Expiration: 12/31/2062 Rental Rate: $23.00 psf The Walgreens store is located along Jonesboro Road, a heavily traveled east/west corridor in McDonough, on a hard signalized intersection with Kroger and Goodwill anchored shopping centers. The Walgreens store features a drive-thru pharmacy and healthcare clinic.

01 Executive Summary Net-Leased Walgreens 6 investment highlights Tenant: Walgreens (NYSE: WAG S&P: BBB stable) is an investment grade tenant with more than 8,650 locations. The company had revenues exceeding $75 billion in 2014. Signalized Hard Corner Location w/ Drive Thru: The subject Walgreens property is quality brick construction with a drive-thru on a hard signalized intersection across from Kroger and Goodwill anchored shopping centers. Offered Free and Clear of Debt: With limited single tenant product in the market, this is a benefit for an investor looking for an all-cash deal or market debt with low current interest rates. Low Rental Rate: The rent could be replaced if Walgreens does not exercise their options.

01 Executive Summary Net-Leased Walgreens 7 location and demographics The subject property, a net-leased Walgreens, located on 204 Jonesboro Road in McDonough, GA, was built in 2001 and is in great physical condition. In 2013, total population within 5 miles was 71,767 with an average household income of $64,536. B Downtown Atlanta FULTON 400 78 Decatur DEKALB Conyers DEMOGRAPHIC SUMMARY 1 MILE 3 MILES 5 MILES Hartsfield Jackson Airport 675 C Population 2013 7,165 38,464 71,767 Stockbridge Total Households 2,646 13,674 24,961 Average Household Income $54,077 $56,685 $64,536 204 Jonesboro Road mcdonough, GA 30253 Fayetteville McDonough Traffic counts 33,110 vehicles per day (Combined: Jonesboro rd and mcdonough pkwy) Source: 2013 Georgia Department of Transportation 75 Willow Ln Ke ly Rd Dailey Mill Rd Jonesboro Rd McDonough Crossing Shopping Center McDonough Pkwy Mt Carmel RdBridges Rd 204 Jonesboro Road mcdonough, GA 30253

01 Executive Summary Net-Leased Walgreens 8 property Aerial - close up 24,790 VPD 8,320 VPD McDonough Pkwy Jonesboro Rd

01 Executive Summary Net-Leased Walgreens 9 property Aerial - Surrounding Retail 24,790 VPD 8,320 VPD McDonough Pkwy Jonesboro Rd

01 Executive Summary Net-Leased Walgreens 10 property Aerial - major subdivisions 8,320 VPD Pkwy 24,790 VPD McDonough 75 Pembrooke Park Subdivision Wesley Lakes Subdivision Jonesboro Rd Cross Creek Subdivision

01 Executive Summary Net-Leased Walgreens 11 property overview Address: 204 Jonesboro Road, McDonough, GA 30253 Parcel ID: 091-01-024-021 County: Metro Market: Zoning: Building Size: Land Area: Henry County - City of McDonough, GA Atlanta MSA C3 15,120 SF 1.92 acres Year Built: 2001 Construction: Parking: Concrete block and brick 35 parking spaces Signage: Large dedicated pylon at Jonesboro Road Access: There are (2) two points of ingress/egress via Jonesboro Road and McDonough Highway Store Number: 6208 204 Jonesboro Road McDonough, GA 30253 Drive-Thru: Pharmacy: Photo: Health Clinic: Store Hours : Pharmacy Hours: Yes Yes Yes No 8:00 AM - 10:00 PM M-F, 9:00 AM - 9:00 PM Sat, 9:00 AM - 6:00 PM Sun, 10:00 AM - 6:00 PM

02 tenant Overview Tenant Summary Rent Roll Net-Leased Walgreens

02 Tenant Overview Net-Leased Walgreens 13 Tenant summary Walgreens SIZE One-Story Building SQUARE FOOTAGE 15,120 LEASE EXPIRATION 2062 Founded in 1901, Walgreens is the largest drug retailing chain in the United States currently operates 8,678 drugstore chains across the United States and Puerto Rico. In addition, Walgreens completed their purchase in 3,000+ store European retail pharmacy giant Alliance Boots to expand their presence internationally. Walgreens is a national leader in providing prescription and non-prescription drugs and household consumer products. With an S&P credit rating of BBB, Walgreens is consistently regarded as one of the most financially sound organizations in the United States. Innovations such as store layout remodeling and in-store health centers have allowed Walgreens to consistently outperform its competitors with regard to earnings per share, revenue growth, net income growth, and cash flow from operations. In 2013, Walgreens posted its unprecedented 39th straight year of record sales and earnings. Walgreen Company (NYSE: WAG) S&P Rating: BBB/stable Headquarters: Deerfield, IL USA Store Locations: 8,678 as of January 31, 2014 Year Founded: 1901 Employees: 244,000 Market Capitalization: $59.31B (8/20/2014) Net Sales: $72.217B (Fiscal 2013) www.walgreens.com

02 Tenant Overview Net-Leased Walgreens 14 RENT ROLL as of August 2014 Suite Tenant Start Date Expiration Date RSF Annual rent Monthly rent PSF rent Renewal increase Notes 1 Walgreens 1/1/2002 12/31/2021 15,120 $347,760 $28,980 $23.00 None Tenant retains Eight (8) x Five (5) year options after the initial Twenty (20) year lease term. 60 year lease.

03 market Overview McDonough, Georgia Demographics Competing Properties Sold Comparables Net-Leased Walgreens

03 Market Overview Net-Leased Walgreens 16 McDonough, Georgia The City of McDonough is located just 20 minutes south of downtown Atlanta. The county seat of Henry County and part of the Atlanta MSA, the City of McDonough has blossomed as a bedroom community to Atlanta and hub for industrial and logistics on the south side of the MSA. The community has grown by more than 87 % over the last 10 years. The strong school system has attracted residential developers and in turn has been followed by national retailers wanting to locate in this market. The market has three interchanges along the I-75 interstate; Jonesboro Road is one of them. McDonough Courthouse Top Ten corporate Employers: metro atlanta Company Employment Delta Airlines 22,257 AT&T 21,915 Emory University and Emory Healthcare 21,000 Cox Enterprises 13,583 United Parcel Service (UPS) 10,745 WellStar Health System 10,112 SunTrust Banks 7,700 Lockheed Martin Aeronautics 7,531 IBM Corporation 7,500 Georgia Institute of Technology 7,342 Top Ten Employers: City of McDonough & Henry County Company Employment Location Henry Medical Center 1,561 Henry County Federal Aviation Administration 612 Henry County Briggs & Stratton Corporation 567 City of McDonough Georgia Power Customer Care 563 Henry County Southern States, LLC 350 City of McDonough Luxottica Retail Group 302 City of McDonough Toys R Us 300 City of McDonough Georgia Crown Distributing Co. 280 City of McDonough Carter s Inc 216 City of McDonough Home Depot Distribution Center 200 City of McDonough

03 Market Overview Net-Leased Walgreens 17 McDonough, ga demographics DEtailed demographics 1 MILE 3 MILES 5 MILES 2013 Population 7,165 38,464 71,767 2018 Projected Population 7,606 41,170 77,263 2010 Census Population 6,934 36,761 68,360 2000 Census Population 4,307 21,430 36,452 Growth 2000-2013 64.32% 76.06% 92.51% Growth 2013-2018 6.15% 7.15% 7.66% 2013 Median Age 31.4 33.7 35.3 2013 Households 2,646 13,674 24,961 2018 Projected Households 2,792 14,680 26,814 2010 Census Households 2,568 13,028 23,788 2000 Census Households 1,561 7,513 12,683 Growth 2000-2010 64.53% 73.40% 87.56% Growth 2010-2013 3.03% 4.96% 4.93% Growth 2013-2018 5.55% 7.36% 7.43% 2013 Average Household Size 2.71 2.75 2.84 2013 Housing Units 2,646 13,674 24,961 2013 Owner Occupied Units 48.49% 62.43% 71.02% 2013 Renter Occupied Units 51.47% 37.57% 28.97% Sources: Claritas, Market + Main, Inc., U.S. Census Bureau

03 Market Overview Net-Leased Walgreens 18 competing properties within 3 miles Target Pharmacy 1850 Jonesboro Rd mcdonough, ga 30235 3.5 miles 75 204 Jonsboro Road MCDonough, GA 30253 Kroger Pharmacy 301 Jonesboro Rd mcdonough, ga 30253 0.4 miles moye s pharmacy 62 keys ferry st mcdonough, ga 30253 1.7 miles 23 155 C onyers Rd cvs pharmacy 2 N Zack Hinton Pkwy McDonough, GA 30253 20 Jonesboro 2.1 miles Sam s Club Pharmacy 1765 Jonesboro rd mcdonough, ga 30253 Walmart pharmacy 135 Willow Ln mcdonough, ga 30253 2.9 miles Rd walgreens 896 Hwy 81 e mcdonough, ga 30252 3.2 miles 3.5 miles Rite Aid 961 Georgia 20 mcdonough, GA 30253 2.6 miles publix pharmacy 920 Hwy 81 E mcdonough, ga 30252 3.3 miles 81 75 23 3.5-mile radius 20 155

03 Market Overview Net-Leased Walgreens 19 sold comparables 1 2 3 1762 Mars Hill Rd Acworth, GA 1556 Lawrenceville Hwy Lawrenceville, GA 5811 Prosperity Church Rd Charlotte, NC Total SF 15,120 Total SF 15,387 Total SF 13,824 Sales Price $5,020,000 ($332 PSF) Sales Price $4,700,000 ($305.45 PSF) Sales Price $3,988,500 ($288.52 PSF) Built 2002 Built 2001 Built 2004 Sold 1.28.13 Sold 6.28.13 Sold 1.10.14 Parking 70 Surface Spaces Land 2.34 Acres Parking 60 Surface Spaces Land 1.74 Acres Parking 54 Surface Spaces Land 1.45 Acres 3 1 2

04 financial Overview Summary Cash Flow Model Net-Leased Walgreens

04 Financial Overview Net-Leased Walgreens 21 financial overview Sales Price $5,235,000 Square Feet 15,120 Price Per SF $346 Cap Rate 6.60% Financing building information Address Propety Type Property is offered free and clear of existing debt 204 Jonesboro Road, McDonough, GA Single-Tenant Retail Year Built 2001 Parcel Size Type of Ownership 1.92 Acres Fee Simple lease details Commencement Date 1/1/2002 End Date 12/31/2062 Initial Lease Term 20 Years Annual Rent $347,760 Rent Escalations (Current Term) None Rent Per Month $28,980 Lease Type NN Options Eight (8) x Five (5) Year Option Rental Increases None Landlord Responsibilities Roof & Structure

04 Financial Overview Net-Leased Walgreens 22 cash flow model Year beginning 1.1.2015 Cash flow projections Year 1 year 2 year 3 year 4 year 5 year 6 year 7 Gross Rental Income $347,760 $347,760 $347,760 $347,760 $347,760 $347,760 $347,760 Expenses ($0.15/sf) $2,268 $2,268 $2,268 $2,268 $2,268 $2,268 $2,268 Net Operating Income $345,492 $345,492 $345,492 $345,492 $345,492 $345,492 $345,492 Offering Price (6.60% cap) $5,235,000