SOUTH ALMADEN DEVELOPMENT

Offering Memorandum SOUTH ALMADEN DEVELOPMENT 771 S Almaden Ave San Jose, CA 95110

N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E Non-Endorsements 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. S. ALMADEN DEVELOPMENT San Jose, CA ACT ID Y0010613

INVESTMENT OVERVIEW 3

EXECUTIVE SUMMARY OFFERING SUMMARY Price $3,100,000 Down Payment 100% / $3,100,000 Loan Amount $0 Loan Type All Cash Lot Size (SF) 27,443 Price/SF $112.96 Lot Size (Acres) 0.63 acre(s) Price/Acre $4,920,599 Price/Unit $281,818 Allowable Buildable SF 16,140 Number of Lots 6 Price/Lot $516,667 Type of Ownership Fee Simple ASSET PERFORMANCE DATA CURRENT CAP Rate 0.0% Net Operating Income $0 Net Cash Flow 0.00% / $0 OFFERING SUMMARY MAJOR EMPLOYERS EMPLOYER # OF EMPLOYEES * Universal Services America LP 5,011 Crows Auto Sales 3,500 Rosendin Electric 3,002 LSI Corporation 2,465 City of San Jose 2,327 Corrections Dept of 2,008 Hadco Santa Clara Inc 2,000 Sunrun 2,000 Bell Integrator Inc 1,996 Coast Personnel Services Inc 1,895 Sanmina Corporation 1,577 Mv Transportation Inc 1,412 DEMOGRAPHICS 1-Miles 3-Miles 5-Miles 2016 Estimate Pop 41,297 272,942 715,864 2016 Census Pop 37,435 249,206 662,606 2016 Estimate HH 13,542 90,565 228,850 2016 Census HH 12,153 82,513 212,562 Median HH Income $50,233 $65,020 $75,256 Per Capita Income $28,861 $33,671 $34,654 Average HH Income $82,986 $99,470 $107,191 * # of Employees based on 5 mile radius 4 #

INVESTMENT OVERVIEW OFFERING SUMMARY Marcus and Millichap, as the exclusive listing agent, is pleased to present the tremendous opportunity to acquire a land development site, fully entitled with complete architectural drawings, for the construction of Ten Townhomes and a duplex project consisting of 3br 2ba units in the thriving city of San Jose, California. With a population of more than a million residents, San Jose combines an ideal climate, world-class cultural attractions and a combination of a suburban atmosphere with the option of big- city living, all while being the global epicenter of technology of the region known as the Silicon Valley. San Jose, often referred to as the Capital of Silicon Valley, is teeming with some of the largest employers in the County including high-tech giants like, Cisco, ebay, Adobe and IBM. A large concentration of major employers, like Adobe, Morgan Stanley and Pricewaterhouse Cooper (PwC) are located in Downtown San Jose, which is less than mile from the subject property in what is referred to, in combination with the Downtown area, Central San Jose. The Downtown boasts an impressive network of public transportation consisting of an abundance of bus stops, light rail stations and also Caltrain, where future residents of this site will be able to take advantage of convenient commutes throughout the immediate area and up the Peninsula to San Francisco. San Jose State University, located about 3/4 mile from the subject property, also a major employer and respected institution of higher learning in the region, and has become a destination for many local and international students looking to get an education in the technology capital of the world. Tremendous employment growth within the South Bay has largely driven housing demand, and Santa Clara County where San Jose is located, is expected to continue to experience impressive growth of approximately 2.9% annually over the next five years. With unemployment rates dropping about 15% from 2014 - Dec 2015 to below 4% in the San Jose area, apartments continue to see demand that outpaces supply. With the cost of homeownership far out of reach for most area residents, renting become the only option. This location in particular will have a competitive advantage over other areas in the South Bay, not only due to its immediate proximity to Downtown, but also due to continued rental appreciation in the Mountain View, Sunnyvale and Santa Clara markets; which, target high income households meaning residents are increasingly being driven to Central San Jose as a discount option that still has all of the amenities that a mature downtown area has to offer dining, nightlife, recreation, cultural attractions, higher education and more. INVESTMENT HIGHLIGHTS 1.5 Miles from Diridon Station Close Proximity to all Major Freeways Redevelopment Opportunity at the entrace of Downtown San Jose Corner Lot Location with Ingress and Egress Possibilities Fully Entitlted Parcels- 10 Townhomes and 1 Duplex Excellent Unit Mix Consisting of 3br 3ba # 5

PROPERTY SUMMARY OFFERING SUMMARY THE OFFERING Property S. Almaden Development Price $3,100,000 Property Address 771 S Almaden Ave,San Jose,CA Assessors Parcel Number 264-34-044 Zoning CN General Plan PD Utilities Yes Ingress/Egress Yes Access S. Almaden Ave SITE DESCRIPTION Lot Size (SF) 27,443 Price/SF $112.96 Lot Size (Acres) 0.6300 Price/Acre $4,920,599 Allowable Buildable SF 16,140 Number of Units 11 Price/Unit $281,818 Number of Lots 5 Price/Lot $516,667 Type of Ownership Fee Simple PROPERTY SUMMARY Wetlands NO Flood Plain Flood Zone Yes Roads Asphalt PUBLIC UTILITIES Sanitary Sewer YES Potable Water San Jose Water Company Gas PG&E 6

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PROPERTY S. ALMADEN NAME DEVELOPMENT PRICING AND LOCATION VALUATION TENANT SUMMARY OVERVIEW MATRIX 771 S Almaden Ave, San Jose, CA 95110 CLOSE PROXIMITY TO: # 9

REGIONAL MAP 10

LOCAL MAP 11

AERIAL PHOTO 12

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FINANCIAL ANALYSIS 14

RENT ROLL SUMMARY FINANCIAL ANALYSIS 15

PROPERTY SUMMARY FINANCIAL ANALYSIS 16

ACQUISITION FINANCING MARCUS & MILLICHAP CAPITAL CORPORATION CAPABILITIES MMCC our fully integrated, dedicated financing arm is committed to providing superior capital market expertise, precisely managed execution, and unparalleled access to capital sources providing the most competitive rates and terms. We leverage our prominent capital market relationships with commercial banks, life insurance companies, CMBS, private and public debt/equity funds, Fannie Mae, Freddie Mac and HUD to provide our clients with the greatest range of financing options. Our dedicated, knowledgeable experts understand the challenges of financing and work tirelessly to resolve all potential issues to the benefit of our clients. Closed 1,651 debt and equity financings in 2016 National platform operating within the firm s brokerage offices $5.1 billion total national volume in 2016 Access to more capital sources than any other firm in the industry WHY MMCC? Optimum financing solutions to enhance value Our ability to enhance buyer pool by expanding finance options Our ability to enhance seller control Through buyer qualification support Our ability to manage buyers finance expectations Ability to monitor and manage buyer/lender progress, insuring timely, predictable closings By relying on a world class set of debt/equity sources and presenting a tightly underwritten credit file 17

MARKET COMPARABLES 18

8 SALES COMPARABLES MAP S. ALMADEN DEVELOPMENT (SUBJECT) 1 2 3 4 1102 Delmas Ave 893 Georgetown Pl 881 Georgetown Pl 555 Mariani Ln SALES COMPARABLES 19

PROPERTY S. ALMADEN NAME DEVELOPMENT SALES COMPARABLES SALES COMPS AVG SALES COMPARABLES Average Cap Rate Average GRM 1.0 1.00 0.0 1102 Delmas Ave Average Price Per Square Foot 893 Georgetown Pl 881 Georgetown Pl Avg. 0.00% 555 Mariani Ln 0.00 Average Price Per Unit 1102 Delmas Ave 893 Georgetown Pl 881 Georgetown Pl Avg..00 555 Mariani Ln $600.00 $540.00 Avg. $556.48 $1,000,000 $900,000 Avg. $892,500 $480.00 $800,000 $420.00 $700,000 $360.00 $600,000 $300.00 $500,000 $240.00 $400,000 $180.00 $300,000 $120.00 $200,000 $60.00 $100,000 $0.00 1102 Delmas Ave 893 Georgetown Pl 881 Georgetown Pl 555 Mariani Ln $0 1102 Delmas Ave 893 Georgetown Pl 881 Georgetown Pl 555 Mariani Ln 20

PROPERTY S. ALMADEN NAME DEVELOPMENT SALES MARKETING COMPARABLES TEAM SALES COMPARABLES 1102 DELMAS AVE 1102 Delmas Ave, San Jose, CA, 95125 1 893 GEORGETOWN PL 893 Georgetown Pl, San Jose, CA, 95126 2 881 GEORGETOWN PL 881 Georgetown Pl, San Jose, CA, 95126 3 rentpropertyname1 rentpropertyname1 rentpropertyname1 Units Unit Type Close Of Escrow: 8/11/2017 1 3 Bdr 3 Bath Sales Price: $960,000 Price/Unit: $960,000 Price/SF: $501.31 Total No. of Units: 1 Year Built: 2003 Units Unit Type Close Of Escrow: 4/30/2017 1 3 Bdr 3 Bath Sales Price: $875,000 Price/Unit: $875,000 Price/SF: $552.40 Total No. of Units: 1 Year Built: 2004 Units Unit Type Close Of Escrow: 7/20/2017 1 3 Bdr 3 Bath Sales Price: $875,000 Price/Unit: $875,000 Price/SF: $598.09 Total No. of Units: 1 Year Built: 2002 rentpropertyaddress1 rentpropertyaddress1 rentpropertyaddress1 21

PROPERTY S. ALMADEN NAME DEVELOPMENT SALES MARKETING COMPARABLES TEAM SALES COMPARABLES 555 MARIANI LN 555 Mariani Ln, San Jose, CA, 95112 4 rentpropertyname1 rentpropertyname1 rentpropertyname1 Units Unit Type Close Of Escrow: 7/31/2017 1 3 Bdr 2 Bath Sales Price: $860,000 Price/Unit: $860,000 Price/SF: $574.10 Total No. of Units: 1 Year Built: 2003 rentpropertyaddress1 rentpropertyaddress1 rentpropertyaddress1 22

MARKET OVERVIEW 23

SAN JOSE OVERVIEW MARKET OVERVIEW The San Jose-Sunnyvale-Santa Clara metro is located at the southern end of the San Francisco Bay and encompasses Santa Clara and San Benito Counties. A large portion of the area s 1,315 square miles is unincorporated ranch and farmland. The metro contains more than 2 million inhabitants in 15 cities. More than half of the region s residents reside in the city of San Jose. It is the metro s largest city with more than 1 million residents, followed by Sunnyvale and Santa Clara. Venture capital funds received in the 1990s helped to turn the area into the world s most prominent technology hub, a distinction that remains today. METRO HIGHLIGHTS PREMIER HIGH-TECH CENTER Silicon Valley s dense concentration of high-tech jobs is world renowned, attracting a variety of large employers and startups. HIGH INCOMES Well-paying jobs in the tech sector contribute to a median annual household income level that is almost double the U.S. median. HIGHLY EDUCATED WORKFORCE Nearly half of all residents age 25 and older have obtained at least a bachelor s degree, well above the U.S. average. 24

MARKET OVERVIEW ECONOMY The San Jose employment base contains more than 1 million workers, ranking the metro as one of the 30 largest job markets in the nation. There are various Fortune 500 companies headquartered in San Jose, including Intel, Cisco Systems, Apple Inc., ebay and Google Inc. The area s many colleges and universities, including Stanford, San Jose State and Santa Clara, support these companies by graduating thousands of engineering and computer science students into the local workforce. MAJOR AREA EMPLOYERS Cisco Systems County of Santa Clara Kaiser Permanente Northern California Hewlett-Packard Co. City of San Jose IBM ebay Xilinx San Jose State University Apple * Forecast SHARE OF 2016 TOTAL EMPLOYMENT 15% MANUFACTURING 21% PROFESSIONAL AND BUSINESS SERVICES 9% 9% 3% GOVERNMENT LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES 13% TRADE, TRANSPORTATION AND UTILITIES 4% CONSTRUCTION + 16% EDUCATION AND HEALTH SERVICES 7% INFORMATION 3% OTHER SERVICES 25

MARKET OVERVIEW DEMOGRAPHICS The metro is expected to add nearly 60,000 people through 2021 and during this time nearly 20,000 households will be formed. High home prices contribute to a homeownership rate of 56 percent, which is below the national rate of 64 percent. Nearly 50 percent of residents age 25 and older hold a bachelor s degree, including 20 percent who have also obtained a graduate or professional degree. SPORTS 2016 Population by Age 6% 0-4 YEARS 19% 5-19 YEARS 6% 20-24 YEARS 30% 25-44 YEARS 26% 45-64 YEARS 12% 65+ YEARS EDUCATION 2016 POPULATION: 2M Growth 2016-2021*: 2.8% 2016 HOUSEHOLDS: 673K Growth 2016-2021*: 3.1% 2016 MEDIAN AGE: 36.9 U.S. Median: 37.7 2016 MEDIAN HOUSEHOLD INCOME: $99,100 U.S. Median: $54,500 QUALITY OF LIFE The San Jose metro has an enviable combination of major universities that produce a highly educated workforce, cutting-edge firms and exceptional affluence. Residents can visit a plethora of museums including the San Jose Museum of Art and the Tech Museum of Innovation. Santa Clara County is home to performing arts companies and hosts the San Jose Jazz Festival. The San Francisco 49ers play their home games at Levi s Stadium and the San Jose Sharks hockey team plays at the SAP Center. Other sports venues include the San Jose Municipal Stadium and Buck Shaw Stadium. The metro is minutes away from San Francisco and some of the world s finest wine-producing regions, notably the Napa, Sonoma and Alexander valleys. ARTS & ENTERTAINMENT * Forecast Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody s Analytics; U.S. Census Bureau 26

PROPERTY S. ALMADEN NAME DEVELOPMENT MARKETING DEMOGRAPHICS TEAM Population In 2016, the population in your selected geography is 41,297. The population has changed by 16.33% since 2000. It is estimated that the population in your area will be 43,029.00 five years from now, which represents a change of 4.19% from the current year. The current population is 53.61% male and 46.39% female. The median age of the population in your area is 29.15, compare this to the US average which is 37.68. The population density in your area is 13,133.83 people per square mile. Race and Ethnicity The current year racial makeup of your selected area is as follows: 44.65% White, 5.00% Black, 0.37% Native American and 16.47% Asian/Pacific Islander. Compare these to US averages which are: 70.77% White, 12.80% Black, 0.19% Native American and 5.36% Asian/Pacific Islander. People of Hispanic origin are counted independently of race. People of Hispanic origin make up 53.40% of the current year population in your selected area. Compare this to the US average of 17.65%. Households There are currently 13,542 households in your selected geography. The number of households has changed by 31.69% since 2000. It is estimated that the number of households in your area will be 14,439 five years from now, which represents a change of 6.62% from the current year. The average household size in your area is 2.70 persons. Housing The median housing value in your area was $529,227 in 2016, compare this to the US average of $187,181. In 2000, there were 3,228 owner occupied housing units in your area and there were 7,055 renter occupied housing units in your area. The median rent at the time was $819. Income In 2016, the median household income for your selected geography is $50,233, compare this to the US average which is currently $54,505. The median household income for your area has changed by 16.05% since 2000. It is estimated that the median household income in your area will be $63,172 five years from now, which represents a change of 25.76% from the current year. Employment In 2016, there are 26,086 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed that 51.22% of employees are employed in white-collar occupations in this geography, and 48.50% are employed in blue-collar occupations. In 2016, unemployment in this area is 8.39%. In 2000, the average time traveled to work was 26.00 minutes. The current year per capita income in your area is $28,861, compare this to the US average, which is $29,962. The current year average household income in your area is $82,986, compare this to the US average which is $78,425. Source: 2016 Experian 27

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PROPERTY S. ALMADEN NAME DEVELOPMENT TRAFFIC COUNT PRICING AND LOCATION VALUATION TENANT MARKETING OVERVIEW SUMMARY MATRIX PLAN YEAR COUNT 2007 10,960 2007 8,200 2007 6,720 Source: 2016 Experian 29 #