THE LEARNING EXPERIENCE

Representative Photo THE LEARNING EXPERIENCE IN LEAGUE CITY, TX Offering Memorandum

NON-ENDORSEMENT & DISCLAIMER NOTICE CONFIDENTIALITY & DISCLAIMER The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB s or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant s plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap. All rights reserved. NON-ENDORSEMENT NOTICE Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers. ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

THE LEARNING EXPERIENCE IN LEAGUE CITY, TX EXCLUSIVELY LISTED BY MITCHELL KIVEN Associate Associate Member - National Retail Group Chicago O Hare Office Tel: 773.867.1587 Fax: 773.867.1510 mitchell.kiven@marcusmillichap.com License IL 475.164486 BRIAN PARMACEK First Vice President Investments Director - National Retail Group Chicago Downtown Office Tel: 312.624.7010 Fax: 312.327.5410 brian.parmacek@marcusmillichap.com License IL 475.132220 TIM SPECK Broker of Record First Vice President/District Manager Dallas Office Tel: 972.755.5200 tim.speck@marcusmillichap.com OFFICES NATIONWIDE AND THROUGHOUT CANADA WWW.MARCUSMILLICHAP.COM Actual Property

THE LEARNING EXPERIENCE 2351 FM 646 RD W, DICKINSON, TX 77539

THE LEARNING EXPERIENCE IN LEAGUE CITY, TX TABLE OF CONTENTS 01 EXECUTIVE SUMMARY SECTION 1 Investment Overview Investment Highlights 16 FINANCIAL ANALYSIS SECTION 3 Pricing Details 07 PROPERTY DESCRIPTION 19 SECTION 2 Property Details Regional Map Property Photos MARKET OVERVIEW SECTION 4 Location Overview Location Highlights Demographics EXCLUSIVELY LISTED BY:

7.15% CAP BRAND NEW CONSTRUCTION 16 YEAR LEASE 10% INCREASES EVERY FIVE YEARS 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap ACT ID Z0000000

EXECUTIVE SUMMARY THE LEARNING EXPERIENCE THE LEARNING EXPERIENCE // EXECUTIVE SUMMARY 1

THE LEARNING EXPERIENCE // EXECUTIVE SUMMARY OFFERING HIGHLIGHTS THE LEARNING EXPERIENCE IN LEAGUE CITY, TX 2351 FM 646, Dickinson, TX 77539 OFFERING PRICE $3,776,000 VITAL DATA CAP RATE 7.15% Price $3,776,000 Cap Rate 7.15% Cash on Cash Return 7.72% Price/SF $377.60 Gross Square Feet MMCC QUOTE 10,000 SF Interest Rate 4.75% Amoritization Fixed Term 25 Years 5 Years LTV 65% Loan quotes are time sensitive and subject to change, please contact Dean Giannakopoulos with Marcus & Millichap Capital Corp for more information. Direct: (312) 327-5423 2

STRONG LOCATION ON A DENSE RETAIL CORRIDOR THE LEARNING EXPERIENCE // EXECUTIVE SUMMARY Representative Photo 3

THE LEARNING EXPERIENCE // EXECUTIVE SUMMARY INVESTMENT OVERVIEW Marcus & Millichap is pleased to present the fee simple interest in The Learning Experience, located in League City, Texas: a new construction childcare center, net leased to the nation s fastest growing childcare & early education company. While the typical Learning Experience lease is 15 years, this investment carries a 16 year lease with 10 percent increases every five years, as well as a five-year limited corporate guarantee. The standards for assigning franchisees to Learning Experience childcare centers are very high, as is the cash investment that the franchisee and franchisor make in the business. Correspondingly, the high success rate enjoyed by franchisees should give confidence to most investors seeking an above market return. Located within the Houston MSA (the 4th largest in the United States), League City and the surrounding suburbs support a growing population and strong economy. Given the high visibility of this site, on a dense retail corridor, The Learning Experience in League City is positioned to generate strong revenues for its operator, as well as serving to increase TLE s brand awareness. From a demographics perspective, the site selection for the League City location far exceeds the standards set by The Learning Experience. The population density within a three mile radius is 50 percent greater than TLE s density requirements, while household incomes within a three mile radius are about 42 percent higher than TLE s already high standard for average household incomes. Sophisticated childcare programs like The Learning Experience have become increasingly essential to families, particularly dual income households working in the modern economy. The childcare business also has inherent resistance both to economic downturns and to e-commerce. Please contact your preferred Marcus & Millichap broker for more information about this opportunity. Representative Photo 4

INVESTMENT HIGHLIGHTS Brand New Construction 16 Year Lease 10 Percent Increases Every Five Years $107,141 Ave HH Income 11 Percent Population Growth Within Five Years 600 Feet From Elementary School Located in TX Income Tax Free State Residual Use Building Has No Interior Load Bearing Columns, Making It Easy to Repurpose 1.24 Acres of Land, Includes a 5,000 SF Playground Class A Finishes High End Build-Out CLOSE PROXIMITY TO: SCHOOLS SHOPPING CENTER MAJOR HIGHWAY Representative Photo

LOCATED 30 MILES SOUTHEAST OF DOWNTOWN HOUSTON THE FOURTH LARGEST MSA IN THE UNITED STATES 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap ACT ID Z0000000

PROPERTY DESCRIPTION THE LEARNING EXPERIENCE THE LEARNING EXPERIENCE // PROPERTY DESCRIPTION 7

THE LEARNING EXPERIENCE // PROPERTY DESCRIPTION TENANT DETAILS The Learning Experience is the fastest growing childcare and early education company in the United States. A typical TLE has a 15 year lease; however, this asset carries a 16 year lease, negotiated by the developer, which includes a 5-year limited corporate guarantee. The success rate for franchisees is incredibly high, and the standards for assigning operators to new Learning Experience centers are equally rigorous. THE LEARNING EXPERIENCE Property Address 2351 FM 646, Dickinson, TX, 77539 Tenant Name The Learning Experience Website www.thelearningexperience.com Parent Company The Learning Experience Headquartered Deerfield Beach, FL Rentable Square Feet 10,000 SF Estimated Rent Commencement 6/1/2018 Estimated Lease Expiration 5/31/2034 No. of Locations 200+ Actual Property 10 8

ADVANTAGES OF CHILDCARE AS A NET-LEASED INVESTMENT The childcare industry is forecasted to increase at an average annual rate of 3.4 percent to become a $62.1 Billion industry over the next five years. The industry as a whole is growing every year, as dual income families become the dominant household structure in our economy. In fact, 64.7 percent of households with children under six are dual income families. As demographic trends become manifest millennials start families of their own, etc. this will continue to drive additional growth in the industry. Furthermore, evidence supports the long-lasting benefits to childhood development that sophisticated, early education childcare programs like those developed by The Learning Experience provide. Relative to comparable net-leased retail investments, childcare as an asset type is service oriented and resistant to e-commerce. It is also has inherent advantages to weather the effects of recession and economic downturns, especially compared to conventional brick & mortar retail. THE LEARNING EXPERIENCE // FINANCIAL ANALYSIS Representative Photo Representative Photo 9

THE LEARNING EXPERIENCE // PROPERTY DESCRIPTION MARKET DRIVERS Strong Traffic Counts - Over 20,000 VPD - Positioned on Going-to-Work Side of Traffic Located 1/2 Mile From Inland Owned Power Center, 1/2 Mile From Cloverleaf Entrance to I-45 Located 0.6 Miles From H.E.B. Plus Grocery Store Easy Access - Branded Signage - 160 ft of Frontage on FM 646 Located at the Entrance to Bay Colony Master Planned Community AREA AMENITITES Over 46,000 People Within a Three Mile Radius Home to 110,000 Square Foot University of Texas Specialty Care Center Thirty Miles South of Houston 600 Feet From Bay Colony Elementary School Close Proximity to Major Retail Representative Photo 10

LOCAL ATTRACTIONS RETAIL RESTAURANTS SCHOOLS H.E.B. 0.6 Miles from site Walmart 1.1 Miles from site Kohl s 0.8 Miles from site Home Depot 1.3 Miles from site Best Buy 1.5 Miles from site Target 1.2 Miles from site Starbucks 1.2 Miles from site Chili s 0.9 Miles from site McDonald s 0.9 Miles from site Burger King 1.1 Miles from site Bay Colony Elementary School 0.3 Miles from site THE LEARNING EXPERIENCE // MARKET OVERVIEW Walgreens 0.4 Miles from site TJ Maxx 1.1 Miles from site Hobby Lobby 1.3 Miles from site Chick-Fil-A 1 Mile from site Lowe s 1.2 Miles from site Kroger 1.4 Miles from site 24-Hour Fitness 1 Mile from site 11

THE LEARNING EXPERIENCE // PROPERTY DESCRIPTION THE LEARNING EXPERIENCE THE LEARNING EXPERIENCE 12

THE LEARNING EXPERIENCE // PROPERTY DESCRIPTION Representative Photo 13

THE LEARNING EXPERIENCE // PROPERTY DESCRIPTION LOCATED 0.6 MILES FROM H.E.B. PLUS GROCERY STORE 14

FINANCIAL ANALYSIS 7.72% CASH ON CASH RETURN AT LIST PRICE PROPERTY NAME HERE 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap ACT ID Z0000000

THE LEARNING EXPERIENCE // FINANCIAL ANALYSIS FINANCIAL ANALYSIS THE LEARNING EXPERIENCE 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap ACT ID Z0000000

PROPERTY SUMMARY YEAR OF NEXT RENT INCREASE 2023 THE OFFERING Property The Learning Experience Property Address 2351 FM 646 Dickinson, TX 77539 Price $3,776,000 Capitalization Rate 7.15% Price/SF $377.60 PROPERTY DESCRIPTION Year Built / Renovated 2018 Gross Leasable Area 10,000 SF Zoning Commercial Type of Ownership Fee Simple Lot Size 1.24 Acres ANNUALIZED OPERATING INFORMATION INCOME $270,000 Net Operating Income $270,000 LEASE SUMMARY LEASE SUMMARY Property Subtype Net Leased Child Care Tenant The Learning Experience Rent Increases 10% Every 5 Years Guarantor Limited Corporate Guarantee Lease Type Triple Net (Excludes Roof and Structure) Estimated Rent Commencement June 1st, 2018 Estimated Lease Expiration May 31st,2034 Lease Term 16 Term Remaining on Lease (Years) 16 Renewal Options Two 5-Year Options Tenant Responsibility All Expenses Excluding Roof and Structure Right of First Refusal/Offer Yes YEAR ANNUAL RENT MONTHLY RENT RENT/SF CAP RATE Current* $270,000 $22,500 $27.00 7.15% Years 2-5 $270,000 $22,500 $27.00 7.15% Years 6-10 $297,000 $24,750 $29.70 7.87% Years 11-16 $326,700 $27,225 $32.67 8.65% THE LEARNING EXPERIENCE // FINANCIAL ANALYSIS Option 1 (Years 16-21) $359,370 $29,948 $35.94 9.52% Option 2 (Years 21-26) $395,307 $32,942 $39.53 10.47% *Like all Learning Experience leases, this lease features a graduated rental stream that increases over the course of the first 12 months to a $22,500 monthly rent. The purpose of this is to allow the tenant time to ramp up their enrollment; however, unlike most TLE leases which are 15 years, this lease provides an extra year of income to an investor. 17

107,289 TOTAL POPULATION WITHIN 5-MILE RADIUS 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap ACT ID Z0000000

MARKET OVERVIEW THE LEARNING EXPERIENCE 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. 2017 Marcus & Millichap ACT ID Z0000000 THE LEARNING EXPERIENCE // MARKET OVERVIEW

THE LEARNING EXPERIENCE // MARKET OVERVIEW LOCATION OVERVIEW League City is a rapidly growing city located between Houston and Galveston, TX. With a population of 102,010 and an annual expansion rate of just over five percent since 2000, League City continues to attract top-level residential and commercial developers. In 2016 there were over 10,000 new residential construction starts due to the attractive job market and excellent accessibility, as League City is centrally located on Interstate 45 and within 20 miles of two airports. Compared to other major metropolitan areas, League City offers affordable housing and a relatively low cost of living, along with robust parks and activities network (27 miles of hiking and bike trails, over 600 acres of parks). The average household income in the community is $108,428, and this combined with one of the region s lowest unemployment rates (4.3%) sets the table for continued growth and appreciation of assets. The city prides itself on a business-friendly climate with an economic base that includes the aerospace, energy, medical, and tourism industries. League City is located within the Houston MSA, the nation s fourth most populous MSA, housing 2.3 million residents in the city proper and 6.8 million in the Houston Metro Area. The strong labor force has contributed to a high-growth environment for businesses in the area, evidenced by one of the lowest unemployment figures for a metro area in the country. With expanding economic activity in the area (GDP expected to more than double between 2015 and 2040), the world s largest medical complex at the Texas Medical Center, and the largest concentration of engineers and architects in the country, as well as world-class entertainment (Texans, Astros, Rockets) and retail districts, Houston serves as a premier profit center for businesses and investors alike. 20

DEMOGRAPHICS HIGHLIGHTS 46,521 TOTAL POPULATION IN A THREE MILE RADIUS $101,577 37,338 AVERAGE HOUSEHOLD INCOME IN A THREE MILE RADIUS TOTAL HOUSEHOLDS IN A FIVE MILE RADIUS THE LEARNING EXPERIENCE // MARKET OVERVIEW 21

THE LEARNING EXPERIENCE // MARKET OVERVIEW 22 UNIT TYPE 1 MILE 3 MILES 5 MILES 2022 Projection Total Population 2017 Estimate Total Population 2010 Census Total Population 2000 Census Total Population 9,301 49,366 114,207 8,577 46,521 107,289 7,129 39,775 92,080 1,409 22,772 53,764 HOUSEHOLDS 1 MILE 3 MILES 5 MILES 2022 Projection Total Households 2017 Estimate Total Households 2010 Census Total Households 2000 Census Total Households 3,344 17,419 40,443 3,037 16,110 37,338 2,535 13,844 32,125 527 8,070 18,889 HOUSING UNITS 1 MILE 3 MILES 5 MILES Occupied Units 2022 Projection 99.0% 96.3% 96.1% 2017 Estimate 98.6% 96.2% 96.0% Owner Occupied 78.9% 76.1% 73.7% Renter Occupied 21.1% 23.9% 26.2% Vacant 1.4% 3.9% 4.0% Units In Structure 2017 Estimate Total Occupied Units 98.6% 96.2% 96.0% 1 Person Units 82.7% 79.1% 77.1% 2 Person Units 0.2% 0.2% 0.5% 3-4 Person Units 0.1% 2.1% 1.9% 5-9 Person Units 1.5% 2.3% 2.7% 10-19 Person Units 8.3% 4.8% 4.8% 20-49 Person Units 2.3% 1.2% 1.5% 50 or more Person Units 4.1% 3.5% 2.2% HOUSEHOLDS BY INCOME 1 MILE 3 MILES 5 MILES 2017 Estimate $150,000 or More 12.8% 16.2% 15.6% $125,000 - $149,999 12.8% 9.4% 9.4% $100,000 - $124,999 11.3% 10.5% 11.1% $75,000 - $99,999 18.6% 14.4% 14.4% $60,000 - $74,999 11.3% 10.9% 10.7% $50,000 - $59,999 6.7% 7.0% 7.2% $40,000 - $49,999 4.8% 5.1% 6.2% $30,000 - $39,999 5.8% 7.8% 7.3% $20,000 - $29,999 4.8% 6.7% 6.5% $19,999 or Below 4.1% 5.2% 4.3% Average Household Income $98,960 $101,577 $99,253 Median Household Income $82,028 $75,782 $75,676 Per Capita Income $35,040 $35,238 $34,618 HOUSEHOLDS BY INCOME 1 MILE 3 MILES 5 MILES Population By Age 2017 Estimate Total Population 8,577 46,521 107,289 Under 20 34.3% 31.2% 31.0% 20-34 Years 23.1% 20.1% 20.3% 35-44 Years 16.3% 15.0% 15.4% 45-54 Years 9.8% 12.5% 12.8% 55-64 Years 9.3% 11.1% 10.9% Age 65+ 7.2% 10.1% 9.8% Median Age 31.7 34.2 34.3 Population 25+ by Education Level 2017 Estimate Population Age 25+ 5,212 29,386 67,889 Elementary (0-8) 2.2% 4.2% 4.0% Some High School (9-11) 3.2% 5.0% 4.5% High School Graduate (12) 18.9% 22.9% 22.9% Some College (13-15) 22.4% 22.0% 23.0% Associate Degree Only 14.6% 9.9% 9.9% Bachelors Degree Only 29.1% 23.9% 23.5% Graduate Degree 9.4% 10.5% 10.7% Population by Gender 2017 Estimate Total Population 8,577 46,521 107,289 Male Population 48.5% 48.7% 49.2% Female Population 51.5% 51.3% 50.8%

THE LEARNING EXPERIENCE EXCLUSIVELY LISTED BY MITCHELL KIVEN Associate Associate Member - National Retail Group Chicago O Hare Office Tel: 773.867.1587 Fax: 773.867.1510 mitchell.kiven@marcusmillichap.com License IL 475.164486 BRIAN PARMACEK First Vice President Investments Director - National Retail Group Chicago Downtown Office Tel: 312.624.7010 Fax: 312.327.5410 brian.parmacek@marcusmillichap.com License IL 475.132220 TIM SPECK Broker of Record First Vice President/District Manager Dallas Office Tel: 972.755.5200 tim.speck@marcusmillichap.com Representative Photo