• Pride-Of-Ownership Luxury Health Club in Affluent San Diego

• Rare Corporate Absolute NNN Lease - Dominant Upscale Brand

• Excellent Demographics and Traffic Counts

• Annual Increases of 2.43%

SAN DIEGO, CA

SAN DIEGO, CA

SINGLE-TENANT LUXURY HEALTH CLUB

FIT Athletic provides large-scale, multi-level facilities in prime, upscale areas with expanded personalized services. With the existing three iconic San Diego locations being expanded to include two new trophy locations this summer in Mission Beach and Little Italy, FIT Athletic is the most luxury health club in the country.

LONG-TERM, CORPORATE ABSOLUTE NNN LEASE

This rare Central San Diego single-tenant luxury club has an absolute NNN lease with no landlord responsibilities. FIT Athletic signed a new 15-year lease in 2014, showing their continued interest in the growing area. The 2.43% annual increases for the remaining 9.5+ years create strong NOI growth year after year and provide a hedge against inflation.

INDOOR/OUTDOOR LOCATION

This 2.5 acre property features an outdoor olympic size swimming pool, three tennis courts, and both indoor and outdoor training sessions. Indoor, FIT offers the most robust group training program in the region for cycling, yoga, aerobics, pilates, cross-training, dance/barre, cardio, strength, and full body exercises.

18.5%POPULATION GROWTHSince 2000

$128,697HH INCOMEWithin 1 Mile

226,800+POPULATION Within 5 Miles

32%+MEMBERSHIP GROWTHOver Last Three Years

2.43%ANNUAL RENT INCREASES

275,300+VEHICLES PER DAYOn Nearby Roads

fitathletic.com

COMMUNITYPARTNERSHIPS

FIT Athletic has entered into several medical-related partnerships, such as the one with Scripps, the leading health care system in the San Diego area. The FIT Functional Wellness Clinic will provide reimbursed health screening and medically-supervised physical therapy, among other services.

OUTSTANDING DEMOGRAPHICS

The regional and local demographics and economic trends of San Diego are strong and highly-conducive to FIT’s continuing success. The iconic locations are destinations for the 3.3 million residents in the San Diego metro area, especially in the key 18- to 44-year-old demographic.

The NNN Fitness group of Marcus & Millichap is pleased to present this rare opportunity to purchase a fee-simple FIT Athletic located in the high growth market Carmel Mountain Ranch of San Diego, CA. The offering is a 20,800-square-foot state-of-the-art luxury facility positioned on 2.37 acres just off the I-15 freeway and Carmel Mountain Road with over 275,300 combined traffic counts. Nestled beneath the breathtaking San Diego mountains, this location offers not only the superior exercise equipment and amenities FIT is known for, but outdoor and family-oriented fitness options as well. Carmel Mountain Ranch members enjoy three pristine outdoor tennis courts with lighting, an outdoor turf zone, an Olympic-sized swimming pool open for lap swimming, aquatics classes, and swim lessons for kids. The regional and local demographics and economic trends of the

3.3 million residents of San Diego are strong and highly conducive to

FIT’s continuing success. The iconic locations are located in densely

populated, wealthy neighborhoods that support family-oriented health

clubs, especially in the key 18- to 44-year-old demographic. The Carmel

Mountain Ranch location is in close proximity to the premier power

center on the I-15 corridor features national and regional tenants such

as Dick’s Sporting Goods, Nordstrom Rack, Saks Fifth Avenue OFF

5TH, Barnes and Noble, Marshalls, Michaels, Ross, Sprouts, Angelika

Film Center, and a host of other restaurants and specialty retailers.

INVESTMENT OVERVIEW

Executive Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA Executive Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA

AFFORDABLELUXURY

FIT Athletic represents the leading independent high-amenity, high-value health club operator and luxury lifestyle brand in Southern California. Their affordable monthly pricing of $79-$129 per month is unique in the San Diego market.

Executive Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA

BASE RENT MONTHLY RENT ANNUAL RENT CAP RATE

01/15/2020 $55,437.58 $665,250.96 6.00%

01/15/2021 $56,784.71 $681,416.52 6.15%

01/15/2022 $58,164.58 $697,974.96 6.30%

01/15/2023 $59,577.98 $714,935.76 6.45%

01/15/2024 $61,025.73 $732,308.76 6.60%

01/15/2025 $62,508.65 $750,103.80 6.77%

01/15/2026 $64,027.61 $768,331.32 6.93%

01/15/2027 $65,583.48 $787,001.76 7.10%

01/15/2028 $67,177.16 $806,125.92 7.27%

A N N U A L I Z E D O P E R A T I N G D A T A

L E A S E S U M M A R Y

Lease Term 9.5+ Years Left

Commencement Date January 15, 2014

Expiration Date January 15, 2029

Lease Type Absolute NNN

Increases 2.43% Annually

Renewal Options Two 5-Year Options

OFFERING SUMMARY

Executive Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA

$11,087,600Offering Price

Outdoor AmenitiesSwimming Pool* and Tennis Courts

6.62%Average Cap Rate

$665,250.96Net Operating Income

2.37 Acres

20,800 SFGross Leasable Area (GLA)

1996 / 2015Year Built / Remodeled

NOI $665,250.96

AVG CAP RATE 6.62%

*Pool area not included in the sale - operates on long-term lease with the City by Operator Fit Athletic

SITE PLANProperty Description | FIT Athletic | 12171 World Trade Dr, San Diego, CA Property Description | FIT Athletic | 12171 World Trade Dr, San Diego, CA

CARMEL MOUNTAIN RANCH

SUBJECT PROPERTY

NAP

Property Description | FIT Athletic | 12171 World Trade Dr, San Diego, CA

Female 47.5%

Male 52.5%

13-17 18-24 25-34 35-44 45-54 55-64 65+

6.3% 26.8%

6.2% 26.8%

8.9%

13.6% 4.0%

2.5% 1.0%

0.9%

0.7%

0.9%

65%13%22%18 YRS

Business ProfessionalsService IndustryStudents (Undergrad & Grad)Youngest Member Of FamilyOldest Member Of Family

FIT MEMBER PROFILE

FIT is more than just a gym - it’s a lifestyle brand that encourages healthy

and inspired living. Offering an unparalleled, all-encompassing member

experience, FIT sets the bar when it comes to personal training, group fitness,

workout facilities, social events, and more. With an extraordinary country club-

like atmosphere, a culture that fosters and encourages complete wellness, and

all of the tools and training you need to see incredible results - there’s no wonder

FIT has been voted “Best Gym” by San Diego Downtown News year after year.

FIT Athletic has entered into several medical-related partnerships, such

as the one with Scripps, the leading health care system in the San Diego

area. The FIT Functional Wellness Clinic will provide reimbursed health

screening and medically-supervised physical therapy, among other

services. They have also been working with the Genavix HealthyCARE

Network® and Cigna Optum® to further implement preventive

Healthcare Risk Assessments, deploy dieticians within the FIT Fitness

Centers, implement diabetes prevention programming, and to subsidize

Senior Advantage and Medicare Supplement Fitness Memberships.

Tenant Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA

LEASE SUMMARY

Tenant Trade Name FIT Athletic

Lease Term 15 Years

Lease Type NNN

Roof & Structure Responsibility Tenant Responsible

Rent Commencement Date January 15, 2014

Lease Expiration Date January 15, 2029

Increases 2.43% Annually

Renewal Options Two 5-Year Options

TENANT SUMMARY

Tenant FIT

Ownership Private

Number of Locations 6

Headquarters San Diego, CA

Website fitathletic.com

TENANT SUMMARY

FIT ATHLETIC (“FIT”), FOUNDED IN 2008, REPRESENTS THE LEADING INDEPENDENT

HIGH-AMENITY, HIGH-VALUE HEALTH CLUB OPERATOR AND LUXURY LIFESTYLE BRAND IN

SOUTHERN CALIFORNIA.

72 YRS

Tenant Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA

Fitness and health clubs have grown to be a more than a $30-billion-a-year industry, with more than 36,000 clubs across the U.S. boasting more than 60 million members.

The current environment appears to offer a perfect storm for the fitness center sector as consumers become more health-conscious and the economy continues to improve.

Fitness concepts are also more internet-resistant than traditional retailers - you cannot work out online.

The fact that neighborhood centers provide goods and services that are not purchased online is very attractive to both private and institutional investors.

INTERNET RESISTANT TENANT

The fitness club sector is flexing its muscles.

FITNESS INDUSTRY BYTHE NUMBERS

30Bhealth and fitness

industry in the U.S.

36,000 clubs across

the U.S.

20% of American adults have a fitness club

membership

3 - 4% annual growth for the last ten

years

60Mmembers

ACROSS THE U.S.

*Estimates per IHRSA & club industry

Tenant Summary | FIT Athletic | 12171 World Trade Dr, San Diego, CA

MARKET OVERVIEW SAN DIEGO

Market Overview | FIT Athletic | 12171 World Trade Dr, San Diego, CA

San Diego County is

California’s second largest city

and the United States’ eighth largest,

San Diego boasts a citywide population

of nearly 1.3 million residents and more

than 3 million residents countywide. Within

its borders of 4,200 sq. miles, San Diego

County encompasses 18 incorporated cities and

numerous other charming neighborhoods and

communities, including downtown’s historic Gaslamp

Quarter, Little Italy, Coronado, La Jolla, Del Mar, Carlsbad,

Escondido, La Mesa, Hillcrest, Barrio Logan and Chula Vista

just to name a few.

San Diego is renowned for its idyllic climate, 70 miles of pristine

beaches and a dazzling array of world-class family attractions. Popular

attractions include the world-famous San Diego Zoo and San Diego Zoo

Safari Park, SeaWorld San Diego and LEGOLAND California. San Diego offers

an expansive variety of things to see and do, appealing to guests of all ages

from around the world.

San Diego’s arts and culture and culinary arts are booming. The hottest, new

culinary arts talents prepare award-winning meals throughout the region’s

6,400 eating establishments. Balboa Park, the largest urban cultural park

in the U.S., is home to 15 museums, numerous art galleries, beautiful

gardens, and the Tony Award-winning The Globe Theatres.

In San Diego’s East County, the terrain varies from gentle

foothills to mile-high mountains and the historic mining

town, Julian, down to the 600,000-acre Anza-Borrego

Desert State Park, offering nature-conscious visitors

endless opportunities to hike, camp, fish, observe

wildlife and much more. In San Diego’s North County, the

agricultural community produces quantities of flowers

and magnificent produce. Wine growers are also making

a mark by growing and harvesting quality grapes that

become excellent wines, which are served at some of

the most elegant restaurants and resorts in the region.

Along the west, 70 miles of Pacific Ocean coastline not

only supports year-round outdoor recreation, such

as surfing, boating, sailing and swimming, but also

important scientific research at the Scripps Institution

of Oceanography. To the south, it’s a whole different

country, Mexico, featuring its own cultural offerings in

various towns along the border and coastline, including

Tijuana, Rosarito and Ensenada.

San Diego County also features almost 100 different

golf courses and a variety of exciting participatory and

spectator sports, beachfront resorts and luxury spas,

gaming, a dynamic downtown district, annual special

events and unique holiday offerings, multicultural

festivals and celebrations, colorful neighborhoods and

communities, a rich military history and much more.

Market Overview| FIT Athletic | 12171 World Trade Dr, San Diego, CA

DEMOGRAPHICS SAN DIEGO

G E N D E R

49.7%

50.3%

$128,697Average Household Income

Within 1-Mile Radius

$497,003Median Housing Value

(118% Increase From 2000)

226,794To t a l P o p u l a t i o n

W i t h i n 5 - M i l e R a d i u s

80,807Total Households

Within 5-Mile Radius

Market Overview | FIT Athletic | 12171 World Trade Dr, San Diego, CA

POPULATION 1 Mile 3 Miles 5 Miles2024 Projection 18,185 99,938 234,760

2019 Estimate 17,212 96,111 226,794

2010 Census 13,760 85,768 208,292

Growth 2019-2024 5.65% 3.98% 3.51%

Growth 2010-2019 25.09% 12.06% 8.88%

HOUSEHOLDS 1 Mile 3 Miles 5 Miles2024 Projection 6,886 38,455 83,682

2019 Estimate 6,506 36,908 80,807

2010 Census 5,131 32,465 73,943

Growth 2019 - 2024 5.84% 4.19% 3.56%

Growth 2010 - 2019 26.80% 13.69% 9.28%

Owner Occupied 3,597 22,784 56,249

Renter Occupied 2,909 14,124 24,558

HOUSEHOLDS BY INCOME 1 Mile 3 Miles 5 Miles2019 Estimate

<$25,000 289 3,326 6,096

$25,000 - $50,000 575 4,673 8,704

$50,000 - $75,000 964 5,059 9,530

$75,000 - $100,000 954 5,008 10,036

$100,000 - $125,000 1,121 5,745 11,374

$125,000 - $150,000 559 3,280 7,133

$150,000 - $200,000 1,259 5,052 12,008

$200,000+ 787 4,764 15,928

2019 Avg Household Income $128,697 $120,343 $138,641

2019 Med Household Income $110,526 $101,686 $113,272

Market Overview| FIT Athletic | 12171 World Trade Dr, San Diego, CA

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by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written

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with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size

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SAN DIEGO, CA

MARK THIELSENIOR MANAGING DIRECTOR INVESTMENTS

SAN DIEGOTel: (858) 373-3206

Mark.Thiel@marcusmillichap.comLicense: CA 01469342

EXCLUSIVELY LISTED BY