NEW 20 yEaR TaCo BEll GRouNd lEaSE 4850 north 99th avenue Phoenix, aZ 85037 For more inFormation, contact: Chuck Klein Kevin Held Ryan J. Schubert Michael P. Hackett 858.546.5473 858.546.5428 602.224.4472 602.224.4449 email@example.com firstname.lastname@example.org email@example.com firstname.lastname@example.org ca Lic: 01522766 ca Lic: 01240358 4850 north 99th Avenue PhoenIx, AZ 85037 excLusiveLy oFFered By: NET LEASED INVESTMENT GROUP Chuck Klein Kevin Held 858.546.5473 858.546.5428 email@example.com firstname.lastname@example.org Ryan J. Schubert Michael P. Hackett 602.224.4472 602.224.4449 email@example.com firstname.lastname@example.org 4350 La Jolla village drive, suite 500, san diego, ca 92122 858.546.5400 Fax: 858.630.6320 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. s:\4850 n 99th\taco_bell_phoenix.indd 4850 north 99th Avenue PhoenIx, AZ 85037 offering statement/disclaimer cassidy turley Bre commercial (hereinafter “ct”) has been retained as the exclusive advisor and broker regarding the sale of the taco Bell (the “Property”) located at 4850 north 99th avenue, Phoenix, arizona. this offering memorandum has been prepared by ct for use by a limited number of parties and does not purport to provide a necessarily accurate summary of the Property or any of the documents related thereto, nor does it purport to be all-inclusive or to contain all of the information which prospective investors may need or desire. all projections have been developed by ct, the owner, and designated sources and are based upon assumptions relating to the general economy, competition, and other factors beyond the control of the owner and, therefore, are subject to variation. no representation is made by ct or owner as to the accuracy or completeness of the information contained herein, and nothing contained herein is, or shall be relied on as, a promise or representation as to the future performance of the Property. although the information contained herein is believed to be correct, owner and its employees disclaim any responsibility for inaccuracies and expect prospective purchasers to exercise independent due diligence in verifying all such information. Further, ct, owner, and its employees disclaim any and all liability for representations and warranties, expressed and implied, contained in, or for omission from, this offering memorandum or any other written or oral communication transmitted or made available to the recipient. this offering memorandum does not constitute a representation that there has been no change in the business or affairs of the Property or the Owner since the date of preparation of the package. Analysis and verification of the information contained in this package is solely the responsibility of the prospective purchaser. Additional information and an opportunity to inspect the Property will be made available upon written request to interested and qualified prospective investors. owner and ct each expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers regarding the Property and/or terminate discussions with any entity at any time with or without notice. owner shall have no legal commitment or obligation to any entity reviewing this offering memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase of the Property has been fully executed, delivered, and approved by Owner and its legal counsel, and any conditions to Owner’s obligations thereunder have been satisfied or waived. CT is not authorized to make any representations or agreements on behalf of owner. this offering memorandum and the contents, except such information which is a matter of public record or is provided in sources available to the public (such contents as so limited herein are called the “Contents”), are of a confidential nature. By accepting the package, you agree (i) to hold and treat it in the strictest confidence, (ii) not to photocopy or duplicate it, (iii) not to disclose the package or any of the contents to any other entity (except to outside advisors retained by you, if necessary, for your determination of whether or not to make a proposal and from whom you have obtained an agreement of confidentiality) without the prior written authorization of owner or ct, (iv) not use the package or any of the contents in any fashion or manner detrimental to the interest of owner or ct, and (v) to return it to ct immediately upon request of ct or owner. If you have no further interest in the Property, please return this offering Memorandum forthwith. Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 table of contents i. oFFerinG summary executive summary ...............................................................1 investment highlights .............................................................2 area highlights .......................................................................3 cash Flow analysis ................................................................4 ii. ProPerty Location Property description ...............................................................5 Property Photos.................................................................. 6-7 Glendale-Phoenix area map ..................................................8 aerial ......................................................................................9 iii ProPerty inFormation site Plan ..............................................................................10 tenant information................................................................11 iv. marKet inFormation area information ...................................................................12 demographics ......................................................................13 iv Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 executive summary Tenant: divine tacos LLc (dba. taco Bell) Guarantor: Personal Guarantee from owners of LLc (david & Karen divine) location: 4850 north 99th avenue Phoenix, aZ 85037 Building Size: 2,880 square feet land Size: .613 acres year Built & opened: 2009 Rent Commencement: august 20, 2009 lease Expiration: august 31, 2029 lease Term: twenty (20) years options Four (4), five (5) year options lease Type: triple net Ground Lease Rent Increases: Rent compounds 2% annually during primary term and options (3% first year of each option period then 2% per annum thereafter) Percentage Rent/ 3% of sales above sales breakpoint of $1.6 Million (breakpoint Inflation Hedge: is fixed for the full lease term and all options). The annual compounding increases combined with this percentage rent provision provides an outstanding and unique ability to protect against inflationary possibilities. Next Increase: september 1, 2010 Net operating Income: $70,000 Price: $1,150,000 Cap: 6.09% 1 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 investment highlights Freeway offramp / Convenient access this investment offers an outstanding and unique location adjacent to the full diamond interchange of the Loop 101 Freeway and camelback rd. dominant location this investment is an outparcel to a class a home depot shopping center and is located in immediate proximity to a Wal-mart shopping center. Strong Sales Projections / % Rent Potential / Rare Inflation Hedge other Fast Food restaurants in the area have very strong sales which provide the opportunity for additional percentage rent if sales are above the breakpoint of $1.6 million. Given that the breakpoint is fixed throughout the entire lease term in addition to the annual compounding rental increases, these rent provisions provide an excellent hedge against inflation, which is extremely rare in triple net leased investments. contact listing broker for details. High Population density estimated over 100,000 people within a three-mile radius. High Population Growth a high growth area that has experienced population increases of 85% from 1990-2000, 55% from 2000-2009 and is projected to experience a 20% increase from 2009-2014. Rent Increases / Compounding Income Stream 46,000 cpd 2% annual rent increases and 3% increases in the first year of each option period provide for a growing income stream. 275,000 cpd High Traffic Counts over 46,000 cars per day at the intersection of 99th ave and camelback rd, an increase of 53% in the last three years. in addition, over 275,000 cars per day on Loop 101, an increase of 39% in the last three years. cpd - cars per day 2 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 area highlights university of Phoenix Stadium Brand New dodgers/White Sox Spring Training Facility the subject property is two miles from the university of Phoenix stadium, the Los angeles dodgers and chicago White sox just built their spring home to the arizona cardinals and the tostitos Fiesta Bowl. it seats over training facility just one-mile west of the subject property. it contains 73,000 and brings over $300 million in economic impact to the area. seating for 13,000 people, has multiple full and partial practice fields for each team and spring training attendance totals approximately 131,000. this facility adds millions of dollars of economic impact to the area. Glendale Corporate Center Westgate City Center Glendale corporate center is approximately a half mile north of the approximately two miles north of the subject property is the Westgate city subject property. It contains 294,000 SF of class A office space. center, a regional destination for shopping, entertainment, commercial office and luxury residential 3 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 cash Flow analysis Total Purchase Price $ 1,150,000 *20 year average Proforma Return 7.39% Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Fiscal Year 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Taco Bell Base Minimum Rent $ 70,000 $ 71,400 $ 72,828 $ 74,285 $ 75,770 $ 77,286 $ 78,831 $ 80,408 $ 82,016 $ 83,656 Net Operating Income* $ 70,000 $ 71,400 $ 72,828 $ 74,285 $ 75,770 $ 77,286 $ 78,831 $ 80,408 $ 82,016 $ 83,656 Cash on Cash Return* 6.09% 6.21% 6.33% 6.46% 6.59% 6.72% 6.85% 6.99% 7.13% 7.27% Year 11 Year 12 Year 13 Year 14 Year 15 Year 16 Year 17 Year 18 Year 19 Year 20 Fiscal Year 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Taco Bell Base Minimum Rent $ 85,330 $ 87,036 $ 88,777 $ 90,552 $ 92,364 $ 94,211 $ 96,095 $ 98,017 $ 99,977 $ 101,977 Net Operating Income $ 85,330 $ 87,036 $ 88,777 $ 90,552 $ 92,364 $ 94,211 $ 96,095 $ 98,017 $ 99,977 $ 101,977 Cash on Cash Return* 7.42% 7.57% 7.72% 7.87% 8.03% 8.19% 8.36% 8.52% 8.69% 8.87% Analysis Assumes all cash purchase *Analysis does not include Percentage Rent Projections. Tenant pays an additional 3% of sales over a breakpoint of $1.6 Million (breakpoint is fixed for the entire lease term and options), which provides an excellent inflationary hedge to the owner ALTHOUGH ALL INFORMATION FURNISHED REGARDING PROPERTY FOR SALE, RENTAL OR FINANCING IS FROM SOURCES DEEMED RELIABLE; SUCH INFORMATION HAS NOT BEEN VERIFIED AND NO EXPRESS REPRESENTATION IS MADE NOR IS ANY TO BE IMPLIED AS TO THE ACCURACY THEREOF, AND IT IS SUBJECT TO ERRORS, OMISSIONS, CHANGE OF PRICE, RENTAL OR OTHER CONDITIONS PRIOR SALE, LEASE OR FINANCING, OR WITHDRAWAL NOTICE. CONSULT A CPA FOR TAX & DEPRECIATION IMPLICATIONS. 4 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 Property description location: 4850 north 99th avenue Phoenix, aZ 85037 Building Size: 2,880 square feet land Size: .613 acres year Built & opened: 2009 5 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 Property Photo 6 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 Property Photo 7 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 Glendale-Phoenix area map 8 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 aerial 9 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 site Plan 101 ST R18-PCD PSC-PCD AVE. CAMELBACK ROAD LOT 2 PAD 6 PAD4 6,500 S.F. PAD 5 3,600 S.F. 5,332 S.F. 4A LOT 1B T LO 4B LOT 1A T B LO PAD 4 VIA DEL CIERZO F. S. 04 2,7 SHOPS C 8,400 S.F. SHOPS B MINI MAJOR C 6,600 S.F. MAJOR 11,400 S.F. 8,200 S.F. AVENUE 99TH LOT MA RIP 3 OS A ST R E ET R1-6 SITE AREA: 467,979 S.F. (10.7 ACRES) RE-43 PARKING FRONT FIELD 414 CUSTOMER ADD. 68 REAR 29 TOTAL: 511 MARIPOSA STREET PAD 1C 3,240 S.F. LOT 5C COLINA COURT AVENUE LOT 5B 100TH 100TH AVENUE R1-6 thIS exhIBIt IS DIAGrAMMAtIC onLY AnD IS IntenDeD onLY to ShoW the GenerAL LoCAtIon oF the PArCeL AnD An APProxIMAte DePICtIon oF the Center AS It IS CurrentLY IS exPeCteD to exISt. thIS exhIBIt DoeS not ContAIn the exACt LIneS oF the PArCeL nor DoeS It DePICt the exACt LoCAtIon oF AnY other tenAntS or oCCuPAntS oF the Center. Further, reFerenCeS to Store nAMeS on thIS exhIBIt ShALL In no MASTER SITE PLAN MAnner ConStItute AnY KInD oF rePreSentAtIon AS to PreSent or Future uSe or oCCuPAnCY oF SPACeS At the Center BY SuCh StoreS. thIS exhIBIt IS not A rePreSentAtIon or WArrAntY thAt the Center SCALE: 1" = 80'-0" WILL reMAIn AS DePICteD, nor AS to AnY Future DeveLoPMent, oCCuPAnCY or uSe oF SPACe At the Center. 20' 80' 0' 40' 160' 10 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 tenant information Franchisee Information Corporate Information david divine has been a successful businessman and taco Bell franchisee taco Bell corp., (“tBc”), based in irvine, ca, is a subsidiary of yum! Brands, in Phoenix for 17 years. He has 11 stores. Their financial statement will be inc., (yum) and is the nation’s leading mexican-style quick service restaurant furnished upon request after execution of a confidentiality agreement. chain. taco Bell has over 5,800 restaurants, including about 240 locations outside the us. more than 20% of the restaurants are company-operated, while the rest are franchised or licensed. With over 175,000 employees, taco Bell serves more than 36.8 million consumers each week and sells over 4.5 million tacos each day. additionally, half of the u.s. population sees a Taco Bell commercial at least once a week, generating significant brand recognition. taco Bell remains to be a key component of yum!’s u.s. performance, contributing about 55% of operating profits domestically. According to YUM!, Taco Bell is the second most profitable fast food concept in the U.S. behind McDonald’s. yum! management strongly believes that taco Bell has the systems in place to continue on its growth path in the future. taco Bell is a leader in the quick service segment offering a unique brand, favorable category positioning, best-in-class menu innovation and much improved operations. With over 40 years in the quick service sector, taco Bell has established a dominant market presence creating an extremely strong domestic brand. it is also the most successful major restaurant chain at driving acceptance of its premium priced menu items. taco Bell has become a model for other concepts, having greatly improved its drive thru times and customer satisfaction scores. taco Bell is one of the best positioned quick service chains to take advantage of the changing restaurant industry trends, including the “better for- you” market and growing fast casual movement. The first Taco Bell opened in 1962 and started franchising in 1964. It was acquired by Pepsico in 1978 when it had 868 units. in 2002, it became part of yum! Brands, inc. with Long John silver’s, a&W, KFc and Pizza hut. 11 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 area information Located in the northeastern reaches of the sonoran stop service to 108 domestic and international destinations with over 1,400 desert, the city of Phoenix is the largest city in arizona daily flights. The Valley’s light rail system offers riders a speedy link between and the fifth largest city in the nation. The Phoenix the cities of Phoenix, tempe, mesa and Glendale and plays an integral part economy is vibrant and strong, attracting many new of a comprehensive valley-wide transit system. the light rail system in the businesses and people, and making Phoenix the Phoenix metropolitan area operates at street level in its own lane separated anchor of a metropolitan area the city has grown from automobile traffic and has priority at traffic signals. 44.7 percent in the last fifteen years. Its population is projected to grow at more than twice the national rate for the next couple of decades. From the Fiesta Bowl to cactus League spring training to nascar the city of Phoenix is served by interstate 10 which leads into Phoenix from to the PGA Tour, the nation’s fifth- Los angeles on the west, and continues southeast through the city and on largest city plays host to some of to tucson and el Paso and interstate 17 which provides a north south route the biggest sporting events in the through the city and is a key industrial corridor. Phoenix is also developing world. Phoenix also fields franchises an extensive urban freeway network that includes approximately 155 miles in all four major professional sports of roadway and will greatly enhance accessibility within the urban area. the leagues, so there’s always a game major components of the system include the Loop 101 that encircles the happening. city of Phoenix, and the Loop 202 providing a route from downtown around the perimeter of the southeast part of the metro area. in 2009, Phoenix was awarded the prestigious all-america City award for the fifth time. The All-America City award is Phoenix has a diverse and large economy. the oldest community recognition program in the nation and transportation, wholesale trade, high- recognizes communities whose citizens work together to technology manufacturing, back-office identify and tackle community-wide challenges to achieve insurance and financial operations, and uncommon results. tourism are all drivers of the economy. employment has increased over 100 percent in the Greater Phoenix area over the past 20 years, resulting in a large and diverse labor pool. Phoenix is also projected to be the 2nd largest “job engine” in the u.s. through 2025, according to newsweek magazine. increases in employment are largely due to the area’s exceptional quality of life, which attracts people and companies from around the world. Phoenix is the headquarters for us airways airlines and a major hub for southwest airlines. Phoenix sky harbor international airport provides non- 12 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. 4850 north 99th Avenue PhoenIx, AZ 85037 demographics 1.0 mi 3.0 mi 5.0 mi 1.0 mi 3.0 mi 5.0 mi Population 2014 Projection 13,080 117,051 321,405 2009 Tenure of Occupied Housing Units 3,447 29,348 84,780 2009 Estimate 10,927 101,611 279,033 Owner Occupied 2,811 24,668 61,404 2000 Census 7,063 74,600 204,969 Renter Occupied 635 4,681 23,376 1990 Census 3,832 39,164 129,652 2009 Average Household Size 3.17 3.46 3.28 Growth 2009 2014 19.70% 15.20% 15.19% Growth 2000 2009 54.71% 36.21% 36.13% 2009 Est. Average Number of Vehicles* 1.99 1.99 1.78 Growth 1990 2000 84.32% 90.48% 58.09% 2009 Est. Pop by Employment Status 7,765 71,832 196,434 Households In Armed Forces 86 1,262 3,292 2014 Projection 4,042 33,360 96,723 Civilian Employed 5,589 46,828 123,010 2009 Estimate 3,447 29,348 84,780 Civilian Unemployed 188 2,920 7,312 2000 Census 2,338 21,888 63,059 Not in Labor Force 1,902 20,821 62,820 1990 Census 1,352 12,168 43,447 2009 Est. Households by Household Income 3,447 29,348 84,780 Growth 2009 2014 17.26% 13.67% 14.09% Income Less than $15,000 158 1,271 7,009 Growth 2000 2009 47.43% 34.08% 34.45% Income $15,000 $24,999 192 1,622 7,957 Growth 1990 2000 72.93% 79.88% 45.14% Income $25,000 $34,999 269 2,722 9,834 Income $35,000 $49,999 596 4,986 14,809 2009 Est. Median Age 30.45 29.86 29.81 Income $50,000 $74,999 1,056 9,183 21,217 2009 Est. Average Age 31.26 30.91 31.41 Income $75,000 $99,999 584 4,683 11,791 Income $100,000 $149,999 500 3,917 9,504 2009 Est. Population by Single Classification Race 10,927 101,611 279,033 Income $150,000 $249,999 79 793 2,022 White Alone 6,909 53,957 156,762 Income $250,000 $499,999 12 125 458 Black or African American Alone 807 8,834 21,676 Income $500,000 and over 1 47 180 American Indian and Alaska Native Alone 95 1,409 4,503 Asian Alone 242 2,915 6,581 2009 Est. Average Household Income $68,201 $68,533 $62,224 Native Hawaiian and Other Pacific Islander Alone 13 159 451 2009 Est. Median Household Income $62,039 $61,090 $53,278 Some Other Race Alone 2,327 29,110 75,876 2009 Est. Per Capita Income $21,512 $19,826 $18,965 Two or More Races 534 5,227 13,186 13 Information contained herein has been obtained from sources that we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it.