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CASCADE VILLAGE 17160-17152 116TH AVENUE SE | RENTON, WASHINGTON 98058

VALUE ADD MULTI-TENANT RETAIL BUILDINGSVALUE ADD MULTI-TENANT RETAIL BUILDINGS

OFFERING MEMORANDUM

AFFILIATED BUSINESS DISCLOSURE AND CONFIDENTIALITY AGREEMENT

CBRE, Inc. operates within a global family of companies with many subsidiaries and/or related entities (each an “Affiliate”) engaging in a broad range of commercial real estate businesses including, but not limited to, brokerage services, property and facilities management, valuation, investment fund management and development. At times different Affiliates may represent various clients with competing interests in the same transaction. For example, this Memorandum may be received by our Affiliates, including CBRE Investors, Inc. or Trammell Crow Company. Those, or other, Affiliates may express an interest in the property described in this Memorandum (the “Property”) may submit an offer to purchase the Property and may be the successful bidder for the Property. You hereby acknowledge that possibility and agree that neither CBRE, Inc. nor any involved Affiliate will have any obligation to disclose to you the involvement of any Affiliate in the sale or purchase of the Property. In all instances, however, CBRE, Inc. will act in the best interest of the client(s) it represents in the transaction described in this Memorandum and will not act in concert with or otherwise conduct its business in a way that benefits any Affiliate to the detriment of any other offeror or prospective offeror, but rather will conduct its business in a manner consistent with the law and any fiduciary duties owed to the client(s) it represents in the transaction described in this Memorandum.

This is a confidential Memorandum intended solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property.

This Memorandum contains selected information pertaining to the Property and does not purport to be a representation of the state of affairs of the Property or the owner of the Property (the “Owner”), to be all-inclusive or to contain all or part of the information which prospective investors may require to evaluate a purchase of real property. All financial projections and information are provided for general reference purposes only and are based on assumptions relating to the general economy, market conditions, competition and other factors beyond the control of the Owner and CBRE, Inc. Therefore, all projections, assumptions and other information provided and made herein are subject to material variation. All references to acreages, square footages, and other measurements are approximations. Additional information and an opportunity to inspect the Property will be made available to interested and qualified prospective purchasers. In this Memorandum, certain documents, including leases and other materials, are described in summary form. These summaries do not purport to be complete nor necessarily accurate descriptions of the full agreements referenced. Interested parties are expected to review all such summaries and other documents of whatever nature independently and not rely on the contents of this Memorandum in any manner.

Neither the Owner or CBRE, Inc, nor any of their respective directors, officers, Affiliates or representatives make any representation or warranty, expressed or implied, as to the accuracy or completeness of this Memorandum or any of its

contents, and no legal commitment or obligation shall arise by reason of your receipt of this Memorandum or use of its contents; and you are to rely solely on your investigations and inspections of the Property in evaluating a possible purchase of the real property.

The Owner expressly reserved the right, at its sole discretion, to reject any or all expressions of interest or offers to purchase the Property, and/or to terminate discussions with any entity at any time with or without notice which may arise as a result of review of this Memorandum. The Owner shall have no legal commitment or obligation to any entity reviewing this Memorandum or making an offer to purchase the Property unless and until written agreement(s) for the purchase of the Property have been fully executed, delivered and approved by the Owner and any conditions to the Owner’s obligations therein have been satisfied or waived.

By receipt of this Memorandum, you agree that this Memorandum and its contents are of a confidential nature, that you will hold and treat it in the strictest confidence and that you will not disclose this Memorandum or any of its contents to any other entity without the prior written authorization of the Owner or CBRE, Inc. You also agree that you will not use this Memorandum or any of its contents in any manner detrimental to the interest of the Owner or CBRE, Inc.

If after reviewing this Memorandum, you have no further interest in purchasing the Property, kindly return this Memorandum to CBRE, Inc.

© 2016 CBRE, Inc. The information contained in this document has been obtained from sources believed reliable. While CBRE, Inc. does not doubt its accuracy, CBRE, Inc. has not verified it and makes no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. The value of this transaction to you depends on tax and other factors which should be evaluated by your tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs.

CBRE and the CBRE logo are service marks of CBRE, Inc. and/or its affiliated or related companies in the United States and other countries. All other marks displayed on this document are the property of their respective owners.

Photos herein are the property of their respective owners and use of these images without the express written consent of the owner is prohibited. TL 6-22-16

C A S C A D E V I L L A G E O F F E R I N G M E M O R A N D U M

CONTACT US

TABLE OF CONTENTS

CONSTANCE WILDEVice PresidentInvestment Properties | Retail+1 206 292 [email protected]

CBRE, Inc.1420 Fifth AvenueSuite 1700Seattle, Washington 98101

01 INVESTMENT HIGHLIGHTS

02 AREA OVERVIEW

03 PROPERTY OVERVIEW

04 FINANCIAL OVERVIEW

For more information on Cascade Village, please visit:

www.cbre-cascadevil lage.com

http://www.cbre-cascadevillage.com

INVESTMENT OVERVIEW

INVESTMENT OVERVIEW

PROPERTY ADDRESS 17160–17152 116th Avenue SE Renton, Washington 98058

OFFERING PRICE $5.3 Million

NOI (IN PLACE) $381,804

CAP RATE (IN PLACE) 7.2%

NOI (PRO FORMA) $408,917

CAP RATE 7.72%

IRR LEVERAGED (10 YEAR HOLD) 32.11%

CASH ON CASH (10 YEAR HOLD) 13.8%

PRICE PSF $115

CURRENT GLA ±46,055 SF

TOTAL LAND AREA (128,440 SF) 2.95 Acres

CURRENT OCCUPANCY 76.8%

FINANCING Bridge or Conventional (see page 26 )

CASCADE VILLAGE

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INVESTMENT HIGHLIGHTS

VALUE ADD RETAIL BUILDINGS - BELOW REPACEMENT COST

+ Mid-market retail - always in demand Ideally positioned retail catering to a broad segment of retailers from destination to local goods and services

+ Long-term tenancy Many tenants have been in this property for over a decade, thriving even through the down turn.

+ Located on a major arterial 116th Avenue SE is a major north-south arterial funneling traffic up and down the Benson Hill. Traffic counts over 14,500 VPD. (Source: City of Renton, 2010)

+ Significant opportunity for rent growth & increased occupancy Current average rents are $12.42 PSF as compared to the submarket average rents of $18.18 PSF. Current occupancy of 76.8% offers an upside of over $300,000 during 10-year hold in NOI. Leveraged IRR of 30.51% end of 10-year hold.

+ Strong Area Demographics The trade area extends as far as 10 minute drive time for those destination retailers and easily draws customers within 7 minutes for those customers seeking neighborhood convenience items and services.

+ Zoning and Community Plan The area is zoned CA – Community Arterial City of Renton.

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AREA OVERVIEW

RENTON

Situated just 11 miles southeast of Seattle along the shores of Lake Washington, Renton is the 8th largest city in Washington State, in terms of population, and the 4th largest in King County. Once an area renowned for salmon fishing, Renton was long an industrial stronghold in the Puget Sound region. Paccar has operated out of the city since the early 1900s, while the Boeing Renton Factory-currently home to 737 production—has been open since World War II.

In terms of economics, Renton has improved over the last 15 years. Average household income is approximately $82,000 as of 2014 data. Additionally, property owners in Renton currently enjoy lower average tax increases than many cities in King County, and the city only recently began implementing a B&O tax. As a result, Renton has been the beneficiary of consistent development. IKEA opened its first shop in the Pacific Northwest in Renton in 1994, and is currently in the midst of a major upgrade to their facilities. Providence Health and Services is one of the city’s major employers, recently expanding their operations with a new 18,000 sq. ft. lease in Renton. Finally, in August 2008, the Seattle Seahawks moved their headquarters and training facility from Kirkland, Washington to the Virginia Mason Athletic Center in north Renton. At 200,000 sq. ft., the facility is the second largest in the NFL.

KING COUNTY AND THE PUGET SOUND REGION

Renton sits in Southeastern King County. With over two million residents, the county is the largest in Washington in terms of population, housing nearly 30% of the total population of the state. Average household income in King County is approximately $73,500, well above the state average of $59,478. The thriving business climate is anchored by some of the biggest and most successful companies in the world, including Nordstrom, Boeing, REI, Expedia and Costco. The overall mixed economy—dominated by tech but featuring manufacturing, trade, university and a start-up culture—ensures that local job creation and per capita GDP consistently outpaces the US trend. The influx of highly skilled, highly paid, often relatively young tech workers continue to bolster a broader local service economy that attracts students and tourists. As a result, the Puget Sound region’s cachet and attractiveness as a destination continues to grow. Additionally the lack of a state income tax, alternative arts and music scene, a boutique culture, and vistas of mountains, lakes and forests all play their part in cementing the reputation of the region.

Renton is 8th largest city in

Washington State

CASCADE VILLAGE

4th largest city in King County

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TRANSPORTATION AND INFRASTRUCTURE

Because of its proximity to Asia and integrated infrastructure, the Puget Sound region receives more shipping containers than almost any other port in the country, and regional rail operations are capable of quickly delivering shipping containers to inland markets nationwide.

The interstate and regional highway system is also vital to the shipping industry. Interstate 90 connects Seattle to major markets in the northern United States, and Interstate 5 is the transportation lifeline of the West Coast. Both Seattle and the State of Washington are heavily investing in upgrading and maintaining the region’s transportation infrastructure. Major projects include the replacement of Seattle’s Viaduct and revitalization of Seattle’s waterfront, replacement and expansion of the 520 Floating Bridge, and the upgrade and expansion of avalanche-prone sections of I-90.

The region’s public transportation systems are key to minimizing congestion and enhancing quality of life. The region is served by a fleet of 2,300 buses operated by King County Metro and Community Transit, one of the largest fleets in the county. The largest vanpool fleet in the nation supplements buses, while the region’s light rail system continues to expand, providing rapid transit along a high traffic corridor between Seattle-Tacoma International Airport and the University of Washington as of March 2016. Commuter rail systems connect Tacoma and Everett and the largest ferry system in the nation transports millions of people and vehicles across the Puget Sound every year.

What cannot be moved by sea or land is moved by air. The Seattle-Tacoma International Airport (Sea-Tac) is the Northwest hub for commercial airline service and air freight. Sea-Tac is the 15th busiest airport in the country, handling more than 37 million passengers in 2014. The award winning airport continues to expand and upgrade; a $500 million dollar project to add gates & retail space and upgrade transportation systems to the Northern Satellite terminal is expected to be completed by 2020. As the area continues to rise as an international destination, the airport is working to expand its international arrivals terminal, boosting capacity by 60% and doubling the number of gates by 2030.

Average Household Income in Renton

$82,000

$59,478

Compared to the National Average of

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RENT COMPS

NAME & ADDRESSRENTS

(PSF/YEAR) NNN

TOTAL AVAILABLE

NRSF YEAR BUILT COMMENTS

Cascade Village17148 116th Avenue SE Renton, WA 98058

$6.73-$20.76 46,139 1986 Prime location on Renton’s Benson Hill, busy 116th Ave provides quick access to nearby jobs and neighborhoods.

Sunset Plaza3160-3208 NE Sunset Blvd.Renton, WA 98056

$19.00 36,868 1978Great visibility from NE Sunset Boulevard, the main street in the Highlands. Center includes Saar’s MarketPlace, Goodwill & Toshi’s.

Renton Highlands Marketplace4820 NE 4th StreetRenton, WA 98059

$26.00 13,164 1999 Prime location on Renton’s East Hill area, at the corner of Duvall Ave NE & NE 4th Street.

The Landing1215 N Landing WayRenton, WA 98057

$30.00 - $40.00 $8.50 46,139 2008Premier outdoor shopping destination of south Lake Washington. Anchors include Target, Dick’s, Ross For Less, Regal Cinema and LA Fitness.

Village Square 1222 Bronson Way N Renton, WA 98058

$17.00 624,859 1983 Well-maintained center near the intersection of I-405 and Highway 169, south of The Landing.

532 Rainier Avenue SouthRenton, WA 98055

$22.00 20,538 1973 Strip mall

Renton Village Shopping Center365 S Grady Way Renton, WA 98055

$28.00-$30.00 38,488 1965 Renton Village Shopping center is anchored by Uwajimaya, McDonald’s, Rite Aid, Starbucks, Wells Fargo and Applebee’s.

Curran Plaza20 SW 7th StreetRenton, WA 98056

$19.00 262,756 1985 Strip mall

Benson Plaza17605-17901 108th Avenue SERenton, WA 98055

$19.00-$21.00 75,980 1988 Great location off 108th and Carr Road. Units are connected to the Fred Meyer Building.

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CASCADE VILLAGE

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AVAILABIL ITY SURVEY 5-YEAR AVERAGE

NNN Rent Per Sq.Ft. $18.18 $16.64

Vacancy Rate 3.7% 5.9%

Vacant Sq.Ft. 420,438 672,291

Availability Rate 4.4% 8.3%

Available Sq.Ft. 503,140 946,610

INVENTORY SURVEY 5-YEAR AVERAGE

Existing Buildings 584 580

Existing Sq.Ft. 11,412,749 11,397,175

12 Mo. Construction Starts 23,061 19,153

Under Construction 16,000 13,684

12 Mo. Deliveries 21,259 17,177

DEMAND SURVEY 5-YEAR AVERAGE

12 Month Absorption Sq.Ft. 174,429 83,057

12 Month Leasing Sq.Ft. 238,272 228,303

SALES PAST YEAR 5-YEAR AVERAGE

Sales Price Per Sq.Ft. $212 $187

Asking Price Per Sq.Ft. $212 $189

Sales Volume (Mil.) $129 $55

Cap Rate 6.2% 7.3%

RETAIL SUBMARKET STATS RENTON & TUKWILA

Source: CoStar

$14.50

$15.00

$15.50

$16.00

$16.50

$17.00

$17.50

$18.00

$18.50

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ASKING LEASE RATES, NNN

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VACANCY RATE

3.9% Total Vacancy Rate in the

Renton and Tukwila Retail Submarket*

*Source: CBRE Research, Q4 2015

Source: CoStar1010

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Average Unemployment Rate in Renton

3.2%*

Compared to the National Average of

4.9%*

*Source: U.S. Bureau of Labor Statistics, 201511

DEMOGRAPHICSU

NIT

S O

F S

TRU

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IRE

ONE-MILE RADIUS THREE-MILE RADIUS FIVE-MILE RADIUS

TOTAL POPULATION 17,016 36,490 73,261

POPU

LATI

ON

2015 ESTIMATED POPULATION 17,016 36,490 73,261

2020 PROJECTED POPULATION 18,218 38,799 78,073

2010 CENSUS POPULATION 15,800 34,222 68,527

POPULATION CHANGE 2010-2015 7.70% 6.63% 6.91%

POPULATION CHANGE 2015-2020 7.06% 6.33% 6.57%

2015 ESTIMATED MEDIAN AGE 35.08 36.55 37.42

2015 ESTIMATED AVERAGE AGE 36.23 37.34 38.13

HO

US

EHO

LDS

2015 ESTIMATED HOUSEHOLDS 6,336 13,623 28,120

2020 PROJECTED HOUSEHOLDS 6,775 14,436 29,936

2010 CENSUS HOUSEHOLDS 5,902 12,859 26,392

2000 CENSUS HOUSEHOLDS 7.35% 5.94% 6.55%

GROWTH 2010-2015 6.93% 5.97% 6.46%

GROWTH 2015-2020 2.70 2.66 2.57

2015 EST. AVERAGE HOUSEHOLD SIZE 2.44 2.65 2.64

INC

OM

E

2015 AVERAGE HOUSEHOLD INCOME $76,546 $80,053 $82,168

2020 AVERAGE HOUSEHOLD INCOME $83,048 $86,427 $88,332

2015 MEDIAN HOUSEHOLD INCOME $64,788 $67,211 $67,247

2020 MEDIAN HOUSEHOLD INCOME $69,226 $71,508 $71,486

2015 PER CAPITA INCOME $28,502 $29,886 $31,539

HO

US

ING

2015 ESTIMATED HOUSING UNITS 6,783 14,543 30,113

2015 ESTIMATED OCCUPIED UNITS 6,336 13,623 28,120

2015 ESTIMATED VACANT UNITS 447 920 1,993

2015 EST. OWNER-OCCUPIED UNITS 3,684 8,412 16,476

2015 EST. RENTER-OCCUPIED UNITS 2,652 5,211 11,644

2015 EST. MEDIAN HOUSING VALUE $259,915 $275,809 $289,615

2015 EST. AVERAGE HOUSING VALUE $286,160 $298,999 $312,619

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CASCADE VILLAGE

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The property consists of two buildings that accommodate a wide variety of retail sales and services. The buildings were completed in 1986 and have been well maintained. Building F is tenanted on both sides, allowing for a great deal of flexibility in terms of layout. Along the east side of Building F, Fairwood Martial Arts has grown to 300 students over 15 years they have been in Cascade Village for the last six years. The Bluedog Dance Studio, Christies Catering and Union Salon round out the services that have found great success in this location. The north part of Building G was previously a Bally’s Fitness with a pool. The facility is now a Waterbabies swimming

training center for babies and youth. This new tenant complements the other youth oriented activities offered by the other tenants in the project. Rounding out the health and fitness oriented activities is the 4,059 square foot Crossfit gym.

Both buildings are wood frame and masonry construction with ample electrical capacity, gas-fired roof top HVAC units and aluminum store fronts. Parking is provided at a ratio of approximately 4 per 1,000 square feet of space.

PROPERTY OVERVIEW

+ Property Address 17160-17152 116th Avenue SE Renton, Washington 98058

+ Location Benson Hill, Renton. Adjacent to the Renton Post Office to the south and retail to the north.

+ Total Building Size (GLA) Building F: ±26,200 Building G ±19,855 Total: ±46,055

+

+ Total Land Area ±2.95 acres (128,440 RSF)

+ Year Built 1986

+ Parcel Number 282305-9010

+ Utilities Electrical: Puget Sound Energy Water/Sewer: Soos Creek Natural Gas: Puget Sound Energy Garbage Removal: City of Renton Fire Alarm: ProComm

+ Traffic Counts North of SE Petrovitsky and South of SE 168th Street:14,500 VPD*

+ Zoning and Community Plan The area is zoned Community Arterial (CA), City of Renton. The CA zone provides for a wide variety of retail sales, services and other commercial activities along high-volume traffic corridors. The Benson Hill Community Plan envisions 116th Ave. SE as the central spine of Benson Hill. The plan would include tree-lined street with bike lanes and widen sidewalks.

(Source: * City of Renton, 2010)

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LOCATION HIGHLIGHTS

The shopping center is located in the heart of the neighborhood known as Benson Hill, situated between downtown Renton and Highway 167 on the west and the neighborhood of Fairwood to the east. Benson Hill was recently annexed into the City of Renton, increasing the services and amenities available to residents. The City has plans to enhance 116th Avenue SE between SE 168th Street and SE Petrovitsky Road with trees, bike paths and widened sidewalks. The shops in the project to the north are mostly occupied.

Cascade Village is located on 116th Avenue SE, the main north-to-south corridor for Benson Hill that provides easy access to I-405. The neighborhood surrounding Cascade Village is home to over 73,000 people, 51% of whom

work within 15 – 30 minutes of the property. Major employers in the vicinity include the Boeing 737 plant on the south shores of Lake Washington and Valley Medical Center.

The demographic make-up of the population within 10 minutes of Cascade Village is over 63% highly educated white-collar workers, with over 29% holding bachelor degrees and higher. Average household incomes of $82,168 afford these families a great deal of disposable income. Population growth is expected to be 6.7%, providing ample new customers for the retailers at Cascade Village.

East side of Building F

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BUILDING F ±26,200 RSF

BUILDING G ±19,855 RSF

F GNot to scale

CASCADE VILLAGE

SITE PLAN

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AVAILABLE±1,464 SF

Waterbabies

AVAILABLE±1,625 SF

Offices &Classroom

±8,052 SF

AVAILABLE±2,995 SF

Crossfit±4,059 SF

AVAILABLE±1,660 SF

Women’sLockerRoom

Men’sLockerRoom

G6

G5

G4

G4G2

G3

F8 F9

17130Union Salon±1,200 SF

17132/17134Blue Dog

Dance Studio±1,610 SF

F10

17138Fairwood Martial Arts

±6,430 SF

F11

AVAILABLE17148

±1,800 SF

F12

17150Christie’sCatering

±1,200 SF

F13

17152Shop

±1,000 SF

F1

17160Domino’s Pizza

±2,400 SF

F2

17164Cascade

Nails±1,260 SF

F3

AVAILABLE17166

±1,140 SF

F4

17168Golden Wok±1,200 SF

F5

17170Save Smoke±1,200 SF

F6

17174Mi Casa Market

±1,560 SF

F7

17178R Bar & Grill±4,200 SF

FLOOR PLAN | BUILDING F

FLOOR PLAN | BUILDING G

Not to scale

Available SpacesNot to scale

Available Spaces17

VacantSpace

NewWaterbabiesComing Soon

Owner is installingnew store fronts coincidental to

Waterbabies tenantimprovements

West side of Building G

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NewWaterbabiesComing Soon

West side of Building F (Facing 116th Avenue SE)

Building G East side of Building F

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IN-PLACE AND PROJECTED NOI SUMMARY

In-Place NOI

6/2016, Annualized Price Per SF

Pro Forma

6/2016 to 5/2017 Price Per SF

SIZE OF IMPROVEMENTS 46,105 46,105

REVENUES

Gross Potential Rent $574,176 $12.45 $583,519 $12.66

Absorption/Turnover Vacancy (134,328) (2.91) (98,802) (2.14)

Base Rent Abatements 0 0.00 (22,873) (0.50)

TOTAL SCHEDULED BASE RENT 439,848 9.54 461,844 10.02

Expense Reimbursements 194,160 4.21 203,359 4.41

TOTAL GROSS REVENUE 634,0081 13.75 665,203 14.43

General Vacancy Loss 0 0.00 0 0.00

EFFECTIVE GROSS REVENUE 634,008 13.75 665,203 14.43

Operating Expenses

Electricity (11,568) (0.25) (11,715) (0.25)

Fire Alarm (636) (0.01) (644) (0.01)

HVAC (10,476) (0.23) (10,605) (0.23)

Landscaping (15,828) (0.34) (16,022) (0.35)

Parking Lot (11,040) (0.24) (11,173) (0.24)

Pest Control (492) (0.01) (503) (0.01)

Repairs & Maintenance (40,752) (0.88) (41,260) (0.89)

Security (4,524) (0.10) (4,582) (0.10)

Trash (11,160) (0.24) (11,297) (0.25)

Water Sewer (19,632) (0.43) (19,875) (0.43)

Wages (33,624) (0.73) (34,048) (0.74)

Management Fee (25,356) (0.55) (26,682) (0.58)

Insurance (9,888) (0.21) (10,013) (0.22)

Real Estate Taxes (57,228) (1.24) (57,941) (1.26)

TOTAL EXPENSES (252,204)2 (5.47) (256,286) (5.56)

NET OPERATING INCOME $381,804 $8.28 $408,917 $8.87

Cap Rate 7.20% 7.72%

PURCHASE PRICE AS OF JUNE 1, 2016 $5,300,000 $114.95 $5,300,000 $114.95

In-Place Occupancy (At Start of Analysis With No Vacant Lease-Up) 76.83% 76.83%

Average Occupancy (includes Vacant Lease-Up and Rollover) 82.78%

NOTES: [1] In-Place Net Operating Income is calculated using contractual rents and expense reimbursements as of June 2016, Annualized (with no General Vacancy Loss). In-Place NOI does not include vacant lease-up revenue, downtime due to near-term expirations, or future rent increases for existing tenants. [2] Real Estate Taxes are reassessed based on the sales price.2020

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CASH FLOW PROJECTIONSFiscal Year Ending - 5/31/16 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

FY 2017 $/SF/YRREVENUES

Gross Potential Rent $12.66 $583,519 $603,157 $631,399 $650,871 $672,523 $692,224 $711,124 $731,856 $754,009 $776,015 $794,413Absorption/Turnover Vac. (2.14) (98,802) (15,990) (9,920) (1,721) (6,996) (13,929) (7,792) (7,056) (21,060) (8,110) (21,064)

Base Rent Abatements (0.50) (22,873) (15,721) (2,590) (6,225) (5,247) (8,961) (8,584) (5,336) (15,795) (6,083) (14,776)

Total Scheduled Base Rent 10.02 461,844 571,446 618,889 642,925 660,280 669,334 694,748 719,464 717,154 761,822 758,573

Expense Reimbursements 4.41 203,359 253,715 273,740 284,343 289,714 294,138 306,403 315,839 322,089 335,666 333,231

TOTAL GROSS REVENUE 14.43 665,203 825,161 892,629 927,268 949,994 963,472 1,001,151 1,035,303 1,039,243 1,097,488 1,091,804

General Vacancy Loss 0.00 0 (9,245) (17,156) (26,149) (21,714) (15,393) (22,476) (24,215) (10,749) (25,058) (12,322)

EFFECTIVE GROSS REVENUE 14.43 665,203 815,916 875,473 901,119 928,280 948,079 978,675 1,011,088 1,028,494 1,072,430 1,079,482

Operating Expenses

Electricity (0.25) (11,715) (12,066) (12,428) (12,801) (13,185) (13,580) (13,988) (14,408) (14,840) (15,285) (15,743)

Fire Alarm (0.01) (644) (663) (683) (704) (725) (747) (769) (792) (816) (840) (865)

HVAC (0.23) (10,605) (10,923) (11,251) (11,588) (11,936) (12,294) (12,663) (13,043) (13,434) (13,837) (14,252)

Landscaping (0.35) (16,022) (16,502) (16,998) (17,507) (18,033) (18,574) (19,131) (19,705) (20,296) (20,905) (21,532)

Parking Lot (0.24) (11,173) (11,508) (11,853) (12,209) (12,575) (12,952) (13,341) (13,741) (14,154) (14,578) (15,015)

Pest Control (0.01) (503) (518) (534) (550) (566) (583) (601) (619) (637) (657) (676)

Repairs & Maintenance (0.89) (41,260) (42,498) (43,773) (45,086) (46,439) (47,832) (49,267) (50,745) (52,267) (53,835) (55,451)

Security (0.10) (4,582) (4,719) (4,861) (5,006) (5,157) (5,311) (5,471) (5,635) (5,804) (5,978) (6,157)

Trash (0.25) (11,297) (11,636) (11,985) (12,345) (12,715) (13,097) (13,490) (13,894) (14,311) (14,741) (15,183)

Water Sewer (0.43) (19,875) (20,472) (21,086) (21,718) (22,370) (23,041) (23,732) (24,444) (25,178) (25,933) (26,711)

Wages (0.74) (34,048) (35,070) (36,122) (37,206) (38,322) (39,471) (40,656) (41,875) (43,131) (44,425) (45,758)

Management Fee (0.58) (26,608) (32,637) (35,019) (36,045) (37,131) (37,923) (39,147) (40,444) (41,140) (42,897) (43,179)

Insurance (0.22) (10,013) (10,313) (10,622) (10,941) (11,269) (11,607) (11,956) (12,314) (12,684) (13,064) (13,456)

Real Estate Taxes (1.26) (57,941) (59,680) (61,470) (63,314) (65,213) (67,170) (69,185) (71,261) (73,398) (75,600) (77,868)

Total Operating Expenses (5.56) (256,286) (269,205) (278,685 (287,020) (295,636) (304,182 (313,397) (322,920) (332,090) (342,575) (351,846)

Net Operating Income 8.87 408,917 546,711 596,788 614,099 632,644 643,897 665,278 668,168 696,404 729,855 727,636

Capital Costs

Tenant Improvements (2.01) (92,530) (48,959) (38,853) (59,089) (45,231) (71,881) (72,475) (50,202) (76,481) (52,436) (202,816)

Leasing Commissions (0.69) (31,996) (15,054) (3,272) (4,739) (6,607) (11,283) (10,820) (6,719) (10,779) (7,659) (15,890)

Capital Reserves (0.20) (9,336) (9,616) (9,905) (10,202) (10,508) (10,823) (11,148) (11,482) (11,827) (12,182) (12,547)

TOTAL CAPITAL COSTS (2.90) (133,862) (173,629) (52,030) (74,030) (62,346) (93,987) (94,443) (68,403) (99,087) (72,277) (231,253)

OPERATING CASH FLOW $5.97 $275,055 $473,082 $544,758 $540,069 $570,298 $549,910 $570,835 $619,765 $597,317 $657,578 $496,383

Acquisition & Residual Sale

Acquisition Cost ($5,300,000) 0 0 0 0 0 0 0 0 0 0 All CashIRR

13.87%Net Residual Value (4) 0 0 0 0 0 0 0 0 0 0 9,667,164

CASH FLOW BEFORE DEBT ($5,300,000) $275,055 $473,082 $544,758 $540,069 $570,298 $549,910 $570,835 $619,765 $597,317 $10,324,742

Bridge Loan (5)

Loan Funding / Payoff 3,710,000 0 0 1,992,348 0 0 0 0 0 0 (4,686,433)

Loan Fees (74,200) 0 0 (114,047) 0 0 0 0 0 0 0 LeveragedIRR

32.11%Annual Debt Service 0 (222,600) (222,600) (222,600) (380,346) (380,346) (380,346) (380,346) (380,346) (380,346) (380,346)

CASH FLOW AFTER DEBT ($1,664,200) $52,455 $250,483 $2,200,459 $159,723 $189,952 $169,564 $190,489 $239,419 $216,971 $5,257,963

NOTES: [1] This figure takes into account vacancy/credit loss, absorption vacancy, turnover vacancy, and base rent abatements. [2] This figure does not include any amount related to expense reimbursements. Only Scheduled Base Rent and Fixed/CPI Increases are included in this calculation, which is based on the weighted-average physical occupancy during each fiscal year. [3] Based on 46,105 square feet. [4] Net Residual Value is calculated by dividing Year 11 NOI by the Residual Cap Rate of 7.00% and applying a 7.00% Cost of Sale. [5] Market Debt based on 70% Loan-to-Value, 6.00% Interest Rate, Interest Only, and 2.00% Loan Fee.

21

RENT ROLL (as of 6/15/2016)

Suite Tenant Name SF% of

Property

Lease Term

Begin End Begin Monthly PSF Annually PSFRecovery

Type

MarketAssumption /Market Rent

F1 Domino’s Pizza 2,400 5.21% Nov-2012 Oct-2022 Current $3,497 $1.46 $41,961 $17.48 NNN Market @90%

Nov-2016 $3,602 $1.50 $43,224 $18.01 $17.50 NNN (Suite F1)

Nov-2017 $3,710 $1.55 $44,520 $18.55

Nov-2018 $3,820 $1.59 $45,840 $19.10

Nov-2019 $3,936 $1.64 $47,232 $19.68

Nov-2020 $4,054 $1.69 $48,648 $20.27

Nov-2021 $4,176 $1.74 $50,112 $20.88

Notes: Tenant has two 5-year options

F2 Cascade Nails 1,260 2.73% Jul-2014 Jun-2019 Current $1,377 $1.09 $16,521 $13.11 NNN Market

Jul-2016 $1,419 $1.13 $17,023 $13.51 $15.00 NNN (Suite F2)

Jul-2017 $1,461 $1.16 $17,527 $13.91

Jul-2018 $1,505 $1.19 $18,056 $14.33

F3 VACANT 1,140 2.47% Oct-2016 Sep-2021 Oct-2016 $1,425 $1.25 $17,100 $15.00 NNN Market

Oct-2017 $1,468 $1.29 $17,613 $15.45 $15.00 NNN (Suite F3)

Oct-2018 $1,511 $1.33 $18,137 $15.91

Oct-2019 $1,557 $1.37 $18,685 $16.39

Oct-2020 $1,604 $1.41 $19,243 $16.88

F4 Golden Wok 1,200 2.60% Jan-2002 Dec-2016 Current $1,225 $1.02 $14,700 $12.25 NNN+10% Admin

Market $16.00 NNN (Suite F4)

F5 Save Smoke 1,200 2.60% Nov-2003 Oct-2018 Current $2,076 $1.73 $24,914 $20.76 NNN Market

Nov-2016 $2,138 $1.78 $25,656 $21.38 $16.00 NNN (Suite F5)

Nov-2017 $2,203 $1.84 $26,436 $22.03

F6 Mi Casa Market 1,560 3.38% Mar-2010 Feb-2018 Current $1,171 $0.75 $14,046 $9.00 NNN Market

May-2017 $1,205 $0.77 $14,461 $9.27 $16.00 NNN (Suite F6)

F7 R Bar & Grill 4,200 9.11% May-2007 Apr-2019 Current $7,160 $1.70 $85,923 $20.46 NNN (no managment)

+15% Admin

Market @90% $21.50 NNN (Suite F7)May-2017 $7,448 $1.77 $89,376 $21.28

May-2018 $7,819 $1.86 $93,828 $22.34

Notes: Tenant has one - 5-year option.

Rental Rates

2222

23




Property

Lease Term Rental Rates


Type

MarketAssumption/Market Rent

F8 Ciao A Complete Salon 1,200 2.60% Oct-2013 Dec-2018 Current $1,156 $0.96 $13,877 $11.56 NNN Market @90%

Oct-2016 $1,191 $0.99 $14,292 $11.91 $12.25 NNN (Suite F8)

Oct-2017 $1,227 $1.02 $14,724 $12.27

Oct-2018 $1,264 $1.05 $15,168 $12.64

F9 Blue Dog Dance 1,610 3.49% Sep-2011 Aug-2016 Current $903 $0.56 $10,841 $6.73 NNN Market @90%

Notes: Tenant has one - 5-year option. $8.00 NNN (Suite F9)

F10 Fairwood Martial Arts 6,430 13.95% Sep-2010 Aug-2020 Current $6,211 $0.97 $74,526 $11.59 NNN Market

Sep-2016 $6,398 $1.00 $76,774 $11.94 $11.60 NNN (Suite F10)

Sep-2017 $6,591 $1.03 $79,089 $12.30

Sep-2018 $6,789 $1.06 $81,468 $12.67

Sep-2019 $6,987 $1.09 $83,847 $13.04

Notes: Tenant has one (1) - five (5) year option at $7,197.54 /mo with 3% annual increases.

F11 VACANT 1,800 3.90% Nov-2016 Oct-2021 Nov-2016 $2,025 $1.13 $24,300 $13.50 NNN Market

Nov-2017 $2,087 $1.16 $25,038 $13.91 $13.50 NNN (Suite F11)

Nov-2018 $2,148 $1.19 $25,776 $14.32

Nov-2019 $2,213 $1.23 $26,550 $14.75

Nov-2020 $2,279 $1.27 $27,342 $15.19

F12 Christies Catering 1,200 2.60% May-2008 Apr-2017 Current $1,409 $1.17 $16,903 $14.09 NNN Market

$12.50 NNN (Suite F12)

F13 Hyde Plumbing 1,050 2.28% Jun-2016 May-2021 Current $1,000 $0.95 $12,000 $11.43 NNN Market

Jun-2017 $1,030 $0.98 $12,359 $11.77 $12.00 NNN (Suite F13)

Jun-2018 $1,061 $1.01 $12,726 $12.12

Jun-2019 $1,093 $1.04 $13,115 $12.49

Jun-2020 $1,125 $1.07 $13,503 $12.86

Notes: Analysis assumes seller to credit any outstanding leasing costs and free rent. Tenant has one (1) - five (5) year option.

G1 Crossfit - D-Box 4,059 8.80% Oct-2013 Sep-2018 Current $2,871 $0.71 $34,450 $8.49 NNN Market @90%

Oct-2016 $2,956 $0.73 $35,476 $8.74 $8.50 NNN (Suite G1)

Oct-2017 $3,044 $0.75 $36,531 $9.00

Notes: Tenant has one (1) - three (3) year option.

G2 VACANT 2,995 6.50% Feb-2017 Jan-2022 Feb-2017 $3,085 $1.03 $37,018 $12.36 NNN Market

Feb-2018 $3,177 $1.06 $38,126 $12.73 $12.00 NNN (Suite G2)

Feb-2019 $3,272 $1.09 $39,264 $13.11

Feb-2020 $3,372 $1.13 $40,462 $13.51

Feb-2021 $3,472 $1.16 $41,660 $13.91

23


Property

Lease Term


Type


G3 VACANT 1,660 3.6% May-2017 Apr-2022 May-2017 $1,710 $1.03 $20,518 $12.36 NNN Market

May-2018 $1,761 $1.06 $21,132 $12.73 $12.00 NNN (Suite G3)

May-2019 $1,814 $1.09 $21,763 $13.11

May-2020 $1,869 $1.13 $22,427 $13.51

May-2021 $1,924 $1.16 $23,091 $13.91

G4 Waterbabies 8,052 17.46% Apr-2016 Aug-2026 Current $5,368 $0.67 $64,416 $8.00 NNN Market @90%

Sep-2018 $6,039 $0.75 $72,468 $9.00 $8.00 NNN (Suite G4)

Sep-2020 $6,710 $0.83 $80,520 $10.00

Sep-2022 $6,911 $0.86 $82,936 $10.30

Sep-2023 $7,113 $0.88 $85,351 $10.60

Sep-2024 $7,327 $0.91 $87,928 $10.92

Sep-2025 $7,549 $0.94 $90,585 $11.25

G5 VACANT 1,625 3.52% Jul-2017 Jun-2022 Jul-2017 $1,674 $1.03 $20,085 $12.36 NNN Market

Jul-2018 $1,724 $1.06 $20,686 $12.73 $12.00 NNN (Suite G5)

Jul-2019 $1,775 $1.09 $21,304 $13.11

Jul-2020 $1,829 $1.13 $21,954 $13.51

Jul-2021 $1,884 $1.16 $22,604 $13.91


Feb-2019 $1,599 $1.09 $19,193 $13.11 $12.00 NNN (Suite G6)

Feb-2020 $1,648 $1.13 $19,779 $13.51

Feb-2021 $1,697 $1.16 $20,364 $13.91

Feb-2022 $1,748 $1.19 $20,979 $14.33


Rental Rates

Notes: Analysis assumes seller to credit outstanding leasing costs and free rent. Tenant has two (2) - five (5) year options.

2424

25



Property

Lease Term


Type


G3 VACANT 1,660 3.6% May-2017 Apr-2022 May-2017 $1,710 $1.03 $20,518 $12.36 NNN Market

May-2018 $1,761 $1.06 $21,132 $12.73 $12.00 NNN (Suite G3)

May-2019 $1,814 $1.09 $21,763 $13.11

May-2020 $1,869 $1.13 $22,427 $13.51

May-2021 $1,924 $1.16 $23,091 $13.91

G4 Waterbabies 8,052 17.46% Apr-2016 Aug-2026 Current $5,368 $0.67 $64,416 $8.00 NNN Market @90%

Sep-2018 $6,039 $0.75 $72,468 $9.00 $8.00 NNN (Suite G4)

Sep-2020 $6,710 $0.83 $80,520 $10.00

Sep-2022 $6,911 $0.86 $82,936 $10.30

Sep-2023 $7,113 $0.88 $85,351 $10.60

Sep-2024 $7,327 $0.91 $87,928 $10.92

Sep-2025 $7,549 $0.94 $90,585 $11.25

G5 VACANT 1,625 3.52% Jul-2017 Jun-2022 Jul-2017 $1,674 $1.03 $20,085 $12.36 NNN Market

Jul-2018 $1,724 $1.06 $20,686 $12.73 $12.00 NNN (Suite G5)

Jul-2019 $1,775 $1.09 $21,304 $13.11

Jul-2020 $1,829 $1.13 $21,954 $13.51

Jul-2021 $1,884 $1.16 $22,604 $13.91


Feb-2019 $1,599 $1.09 $19,193 $13.11 $12.00 NNN (Suite G6)

Feb-2020 $1,648 $1.13 $19,779 $13.51

Feb-2021 $1,697 $1.16 $20,364 $13.91

Feb-2022 $1,748 $1.19 $20,979 $14.33

OCCUPIED SF 35,422 76.8%

VACANT SF 10,684 23.2%

TOTAL SF 46,106 100.0%

Weighted Average Lease Term Remaining 4.72 Years

Weighted Average Lease Term Lapsed 4.55 Years

Weighted Average Lease Term Inceptio 9.26 Years



Property

Lease Term


Type


ROOF Sprint 1 0% Jun-2009 May-2108 Current $1,230 $1,229.86 $14,758 $14,758.32 GROSS Market GROSS

ASSUMED Jun-2017 $1,267 $1,266.76 $15,201 $15,201.07 $14,760/Yr (ROOF)

Jun-2018 $1,305 $1,304.76 $15,657 $15,657.10

Jun-2019 $1,344 $1,343.90 $16,127 $16,126.81

Jun-2020 $1,384 $1,384.22 $16,611 $16,610.62

Jun-2021 $1,426 $1,425.75 $17,109 $17,108.94

Jun-2022 $1,469 $1,468.52 $17,622 $17,622.21

Jun-2023 $1,513 $1,512.57 $18,151 $18,150.87

Jun-2024 $1,558 $1,557.95 $18,695 $18,695.40

Jun-2025 $1,605 $1,604.69 $19,256 $19,256.26

Jun-2026 $1,653 $1,652.83 $19,834 $19,833.95

Jun-2027 $1,702 $1,702.41 $20,429 $20,428.97

Jun-2028 $1,753 $1,753.49 $21,042 $21,041.84

Jun-2029 $1,806 $1,806.09 $21,673 $21,673.09

Jun-2030 $1,860 $1,860.27 $22,323 $22,323.28

Jun-2031 $1,916 $1,916.08 $22,993 $22,992.98

Notes: Lease expires 5/19. Analysis assumes tenant remains in-place throughout the analysis with 3% annual increases.

TOTAL/AVERAGES $36,653 $1.03 $439,836 $12.42 46,105

Rental Rates

25

FINANCING ASSUMPTIONS

BRIDGE LOAN

INITIAL LOAN FUNDING (AS OF 6/1/2016) $3,710,000

LOAN-TO-PRICE 70%

FUNDING DATE June 2016

MATURITY DATE May 2019

LOAN TERM 3 Years

PAYMENT Interest Only

INTEREST RATE 6%

ORIGINATION FEE ON INITIAL LOAN FUNDING 2%

[1] Leveraged analysis is based on financing that a particular investor may or may not be able to obtain.[2] CBRE Debt & Equity Finance (DEF) is a division of CBRE Inc. In the U.S., DEF represents approximately 300 lenders including: banks, life insurance companies, pension funds, CMBS lenders and a variety of other lending sources. DEF also acts as a correspondent for over 200 life insurance companies. The Quote above is an approximation of available terms. For a debt quote customized to meet your specific requirements, please call David Stinebaugh at +1 206 830 6492 or email him at [email protected].

David Stinebaugh with CBRE Debt and Structured Finance has toured the property and we recommend that any prospective purchaser contact him for further information on the available options for this property.

David Stinebaugh Senior Vice President | Debt & Structured Finance+1 206 830 6492 [email protected]

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OCCUPIED SF 35,422 76.8%

VACANT SF 10,684 23.2%

TOTAL SF 46,106 100.0%

Weighted Average Lease Term Remaining 4.58 Years

Weighted Average Lease Term Lapsed 4.59 Years

Weighted Average Lease Term Inceptio 9.17 Years

CONSTANCE WILDEVice PresidentInvestment Properties | Retail+1 206 292 [email protected]

CBRE, Inc.1420 Fifth AvenueSuite 1700Seattle, Washington 98101

CONTACT US

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