OFFERING MEMORANDUM ADVANCE AUTO PARTS JASPER, INDIANA

OFFERING MEMORANDUM ADVANCE AUTO PARTS JASPER, INDIANA

2 INVESTMENT OVERVIEW INVESTMENT OVERVIEW Marcus & Millichap is pleased to present Advance Auto Parts in Jasper, Indiana; which is in southwest Indiana and less than 80 miles from Louisville, Kentucky. Advance has four years remaining on their second, five-year extension option. No extension options remain. The tenant originally signed a 10-year double-net (NN) in 2001, and has been operating at this location for nearly 17 years. The lease is backed by a corporate guaranty from Advance Stores Company, Incorporated (Inc), a $9.6 Billion revenue company and number 292 on the June 2017 Fortune 500 list. Demand for aftermarket auto parts is growing. In 2016, the Federal Highway Administration reported that the total number of vehicle miles traveled on United States (US) highways increased by 3 percent, and the average age for vehicles on the road is more than 11 years old. The subject asset is situated at the confluence of Hoffman Road and West Sixth Street, where the US-231 retail corridor begins. This asset benefits from strong visibility along US-231. More than 18,000 vehicles pass by this asset daily. Additionally, the parcel has three points of ingress/egress: exterior access from North Truman Road and frontal access points from Hoffman Road and US-231. Significant capital is being deployed in Jasper. As of January 2018, there is more than $40 million in active construction permits. The most notable project is the $22-million River Centre Phase II, which is a live-work-play lifestyle center with an office component, 75 residential units, and more than 30,000 square feet of retail space. Construction will commence in June 2018. Additional tenants in the immediate vicinity include: Big Lots, Goodwill, Fifth Third Bank, CVS, McDonald s, Domino s, Rally s, Hardee s, Ford, Lincoln, and many more.

3 INVESTMENT OVERVIEW Advance Auto Parts in Jasper, Indiana Southwest Indiana 80 Miles from Louisville, Kentucky Advance Has Four Years Remaining on a Double-Net (NN) Lease Tenant Demonstrates Commitment Exercised Both Two, Five-Year Options No Options Remaining Corporate Guaranty Advance Stores Company, Incorporated (Inc) New York Stock Exchange (NYSE: AAP) Standard & Poor (S&P): BBB- Number 292 on Fortune 500 (June 2017) Growing Demand for Aftermarket Auto Parts Average Age of Vehicle On the Road is 11.6 Years Old Total Number of Vehicle Miles Traveled on United States (US) Highways Increased by 3 Percent in 2016 Corner Location Along US-231/Hoffman Rd/W 5th Street Thoroughfare Heavily Trafficked Corridor with More Than 18,000 Vehicles Per Day (VPD) US-231 is Densest Trade Area in Jasper National Tenants in Immediate Vicinity Include: McDonald s, Rally s, CVS, Big Lots, and Hardee s Significant Capital Deployments More Than $44 Million in Active Construction Permits in the City of Jasper as of January 2018 Additional Tenants in the Immediate Vicinity Include: Big Lots, Goodwill, Fifth Third Bank, CVS, McDonald s, Domino s, Rally s, Hardee s, Ford, Lincoln, and Many More

4 FINANCIAL OVERVIEW FINANCIAL OVERVIEW PRICE $1,119,626 CAP RATE 7.75% NOI $86,771 PRICE PER SQUARE FOOT $159.95 RENT PER SQUARE FOOT $12.40 YEAR BUILT 2001 APPROXIMATE LOT SIZE 1.101 Acres GROSS LEASEABLE AREA 7,000 TYPE OF OWNERSHIP LEASE GUARANTOR LEASE TYPE Fee Simple Advance Stores Company, Incorporated (Inc) Double-Net (NN) ROOF AND STRUCTURE Landlord Responsible* *Landlord and Tenant shall share equally the expense of replacing the HVAC including labor and parts, and share equally in repairs exceeding $500 per occurrence including labor and parts. Landlord shall also maintain and repair the easements, and the parking lot, the sidewalks and all other areas of the leased premises that are not structurally a part of the building.

5 LEASE SUMMARY LEASE SUMMARY LEASE COMMENCEMENT DATE 1/1/2002 LEASE EXPIRATION DATE 12/31/2021 LEASE TERM 10 Years TERM REMAINING 4 Years INCREASES None OPTIONS TO RENEW None Remaining

6 TENANT OVERVIEW TENANT OVERVIEW - ADVANCE AUTO PARTS Advance Auto Parts was founded in 1929 as Advance Stores Company, Incorporated and operated as a retailer of general merchandise until the 1980s. During the 1980s, they began targeting the sale of automotive parts and accessories to do-it-yourself (DIY) customers. They began their commercial delivery program in 1996 and have steadily increased sales to Commercial customers since 2000. They have grown significantly as a result of comparable store sales growth, new store openings, and strategic acquisitions. Advance Stores Company (ASC), wholesales and retails automotive parts and maintenance items. In the retail segment, ASC s stores offer a selection of brand name and proprietary automotive products for domestic and imported cars, and light trucks. These stores carry between 16,000 and 21,000 stock keeping units. The dealer stores consist of associate, sales center, and franchise dealers. ASC also provides services to the wholesale dealer network through various administrative and support functions, as negotiated by each independent location. The company competes with AutoZone, O Reilly Automotive, The Pep Boys Manny; Moe & Jack; Wal-Mart; Target; and K-Mart. TENANT PROFILE TENANT TRADE NAME OWNERSHIP TENANT LEASE GUARANTOR Advance Auto Parts Public Corporate Store Corporate Guarantee NUMBER OF LOCATIONS 5,200+ HEADQUARTERED Roanoke, Virginia SALES VOLUME $9.6 Billion (2016) NET WORTH $2.9 Billion (2016) STOCK SYMBOL BOARD CREDIT RATING RATING AGENCY AAP NYSE BBB- Standard & Poor (S&P) RANK Number 292 in Fortune 500 (June 2017)

7 DEMOGRAPHICS DEMOGRAPHICS 3-Mile 5-Mile 10-Mile POPULATION 2000 Population 14,922 17,753 32,606 2010 Population 16,210 19,341 34,722 2017 Population 16,599 19,783 35,396 2022 Population 16,832 20,056 35,842 3-Mile 5-Mile 10-Mile HOUSEHOLDS 2000 Households 5,811 6,837 12,339 2010 Households 6,443 7,621 13,476 2017 Households 6,599 7,798 13,740 2022 Households 6,694 7,909 13,917 3-Mile 5-Mile 10-Mile HOUSEHOLD (HH) INCOMES 2017 Average HH Income $72,009 $72,997 $70,346 2017 Median HH Income $57,439 $58,600 $58,491 2017 Per Capita Income $28,627 $28,774 $27,307

8 JASPER, INDIANA ABOUT JASPER Jasper in Dubois County is located in southwest Indiana along the Patoka River. It s been said if something needs to be accomplished give it to someone from Jasper and it will get done and done well. Public-private partnerships have invested several million dollars over the last ten years to build upon this unique characteristic along the Riverfront of the Patoka River. Anchored by a two-mile meandering Riverwalk, the redevelopment also includes the Jasper City Mill, a Train Depot and the amazing Spirit of Jasper Luxury Excursion Train - with specially-designed passenger cars featuring the talent of the local craftsmen. This renewal led to three Downtown Jasper projects currently underway: River Centre a mixed use residential, retail and hotel development right along the Patoka River, The Jasper Cultural Center a joint venture bringing the Jasper Arts and the Jasper Public Library under one roof, The Astra Theatre renovation and reopening of a historic theater on the Downtown Square by The Next Act, Incorporated (Inc). Jasper has the only municipally-funded arts department in the State of Indiana and is the only community twice honored with the coveted Governor s Arts Award. The 700- seat Jasper Arts Center serves thousands of patrons annually with four different series of performances. Area schools benefit from on-campus arts demonstrations and the annual Chalk Walk draws hundreds of homegrown artists who bring color to Jasper s downtown sidewalks with displays, demonstrations, hands-on activities, music and an Arts Market. Numerous festivals and events occur annually including the Strassenfest, a street festival honoring the City s German heritage, which draws thousands of people each August. The Indiana Baseball Hall of Fame, which honors players and others associated with the national pastime who were born or lived in Indiana, is located in Jasper. The city s largest park The Parklands of Jasper will open in 2018! Situated on 75 acres in the center of Jasper, The Parklands of Jasper includes the former Jasper Country Club Golf Course and adjacent wooded acreage purchased through contributions by citizens and the Indiana Bicentennial Nature Trust. Jasper is a community of recreation with nearly 20 neighborhood parks, trails and sports complexes for softball, baseball and soccer, tennis and aquatics. The city provides activities for all lifestyles, from a park for special needs children to a nine-acre campus for seniors at the Arnold F. Habig Community & Older American Center to competition horseshoes to Pickleball. JASPER TOP EMPLOYERS No. Business Name 1 Kimball International El Paso Independent School District 2 MasterBrand Cabinets 3 Jasper Engines & Transmissions 4 Memorial Hospital 5 Jasper Rubber Products 6 JasperGroup

9 JASPER, INDIANA There are over one thousand businesses in Jasper. An abundance of opportunities can be attained with several national and international companies who employ hundreds or even thousands along with many small businesses that operate with only a few employees and offer a rewarding career. During a normal workday, the population of Jasper is said to double. Employees travel from surrounding towns and the eight surrounding counties to work in Jasper, the hub of Dubois County. In fact, Dubois County continues to have among the lowest rates of unemployment in Indiana. Today, Jasper is still known as the Wood Office Furniture Capital of the World, with its companies manufacturing office, home and lodging furniture, seating, desks, and kitchen cabinets. Several local furniture manufacturers, including Kimball International, Indiana Furniture, Jasper Group, Jasper Chair, OFS/Styline, MasterBrand and Ditto Sales/Versteel, ship their fine lines of furniture all over the world.

MARCUS & MILLICHAP HEREBY ADVISES ALL PROSPECTIVE PURCHASERS OF NET LEASED PROPERTY AS FOLLOWS: The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided. As the Buyer of a net leased property, it is the Buyer s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer. Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors. Buyer and Buyer s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs. Like all real estate investments, this investment carries significant risks. Buyer and Buyer s legal and financial advisors must request and carefully review all legal and financial documents related to the property and tenant. While the tenant s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer s legal ability to make alternate use of the property. By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property.

ADVANCE AUTO PARTS JASPER, INDIANA 485 US-231 JASPER, INDIANA 47546 BROKER OF RECORD: JOSH CARUANA MARCUS & MILLICHAP LICENSE: PB20803582