STARBUCKSOFFERING MEMORANDUM | 1010 NORTH GAREY AVENUE | POMONA, CA

A C T U A L S I T E

2 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

STARBUCKS1010 NORTH GAREY AVENUE | POMONA, CA

THE TEAM

OFFERING MEMORANDUM

This Memorandum does not constitute a representation that the business or affairs of the

Property or Seller since the date of preparation of this Memorandum have remained the

same. Analysis and verification of the information contained in this Memorandum are solely

the responsibility of the prospective purchaser.

Additional information and an opportunity to inspect the Property will be made available

upon written request of interested and qualified prospective purchasers. Seller and Agent

each expressly reserve the right, at their sole discretion, to reject any or all expressions of

interest or offers regarding the Property, and/or terminate discussions with any party at any

time with or without notice. Seller reserves the right to change the timing and procedures

for the Offering process at any time in Seller’s sole discretion. Seller shall have no legal

commitment or obligations to any party reviewing this Memorandum, or making an offer

to purchase the Property, unless and until such offer is approved by Seller, and a written

agreement for the purchase of the Property has been fully executed and delivered by Seller

and the Purchaser thereunder.

This Memorandum and the contents, except such information which is a matter of public

record or is provided in sources available to the public, are of a confidential nature. By

accepting this Memorandum, you agree that you will hold and treat it in the strictest

confidence, that you will not forward, photocopy or duplicate it, that you will not disclose

this Memorandum 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 Seller or Agent, and that you will not use this Memorandum or any of the

contents in any fashion or manner detrimental to the interest of Seller or Agent.

NET LEASE PRACTICE GROUPKEN HEDRICKExecutive Managing Director Net Lease Practice Groupken.hedrick@ngkf.com918.878.9540

JERRY HOPKINSSenior Managing Director Net Lease Practice Groupjerry.hopkins@ngkf.com918.878.9536

SUPPORT

D. ANDREW RAGSDALE, Esq.Senior Managing Director Net Lease Practice Groupandrew.ragsdale@ngkf.com918.878.9535

JEN BLADENSenior Marketing CoordinatorNet Lease Practice Groupjen.bladen@ngkf.com918.878.9534

BRANDON ROGOFFManaging DirectorNKF Retail Capital Markets415.445.5163Brandon.Rogoff@ngkf.comCA RE Lic #01949914

DEBT & EQUITY FINANCE

DUSTIN STOLLYVice Chairman, Co-Head New York Debt/Structured Financedustin.stolly@ngkf.com212.372.2019

JORDAN ROESCHLAUBVice Chairman, Co-Head New York Debt/Structured FinanceJRoeschlaub@ngkf.com212.372.0755

KEZIA BELFIELDAdministrative Assistantkezia.belfield@ngkf.com918.878.9542

GARRETT HUIEFinancial Analystgarrett.huie@ngkf.com918.878.9534

3 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

THE INVESTMENT

5 THE OFFERING

INVESTMENT HIGHLIGHTS

THE TENANT

7 TENANT/CREDIT OVERVIEW

8 LEASE ABSTRACT

RENT SCHEDULE

POMONA, CALIFORNIA

10 LOCATION OVERVIEW

12 DEMOGRAPHICS

A C T U A L S I T E

4 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

THE INVESTMENT

5 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

THE OFFERINGNewmark Knight Frank Capital Markets Net Lease Practice Group (the “Agent”) has been engaged as the exclusive sales representative for the sale of 1010 North Garey Avenue in Pomona, California (the ”Property”).

The Property is 100% leased to Starbucks (Nasdaq: SBUX) and is located within the heart of the Pomona market. The property boasts strong market exposure and benefits from nearby Metrolink rail stops.

INVESTMENT HIGHLIGHTSDENSE URBAN INFILL LOCATION The Property is well located just blocks from both the Pomona-Downtown (Red Line) and the Pomona-North (Purple Line) stops on the Metrolink Los Angeles-Riverside commuter rail system. The Property is just south of I-10 (San Bernardino Freeway) within the heart of the Pomona market, and benefits from high exposure and market presence.

7 YEARS REMAINING OF PRIMARY LEASE TERM The Property boasts a new 10 year primary lease with seven years remaining, which is accompanied by four, five year renewal options.

STARBUCKS CORPORATE GUARANTEED The Lease is 100% Guaranteed by Starbucks, which is rated A- by Standard and Poor’s credit rating.

10% SCHEDULED RENT INCREASES The Lease provides for scheduled 10% rent increases every 5 years throughout the primary term and option periods.

HIGHLY PASSIVE NN LEASE STRUCTURE The Property provides investors with the opportunity to acquire a highly passive net lease, with minimal landlord responsibilities.

INVESTMENT-GRADE TENANT

NASDAQ: SBUX (S&P: A- STABLE)

CORPORATE GUARANTEE

7 YEARS REMAINING ON A

10 YEAR LEASE

10% RENT INCREASES

EVERY FIVE YEARS

24,392 VPD AT E. COLUMBIA & N. GAREY

PURCHASE PRICE $1,809,000

6 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

THE TENANT

7 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

TENANT/CREDIT OVERVIEW

Starbucks Corporation (NASDAQ: SBUX) is an American global coffee company and coffeehouse

chain based in Seattle, Washington. Starbucks was founded in 1985 as a local coffee bean

roaster and retailer and has grown into the largest coffeehouse company in the world. There are

23,768 Starbucks stores in 72 countries, including 13,107 in the United States.

Starbucks locations serve hot and cold beverages, whole-bean coffee, micro-ground instant

coffee, full-leaf teas, pastries and snacks. Most stores also sell packaged food items, hot and

cold sandwiches, and items such as mugs and tumblers. Starbucks Evenings locations also offer

a variety of beers, wines, and small bites after 4 p.m.

Many of the company’s products are seasonal or specific to the locality of the store, while

Starbucks brand ice cream and coffee are also offered at grocery stores. Through Starbucks

Entertainment division and Hear Music brand, the company also markets books, music, and films.

Starbucks has a strong presence both in the US and in the global marketplace due in part to

its rapid growth over the last few decades. In the 1990s, Starbucks was opening a new store

every workday, a pace that continued into the 2000s. The first store outside the United States

or Canada opened in the mid-1990s, and overseas stores now constitute almost one third of

Starbucks’ stores.

As of October, 2016, Starbucks Corp had annual revenues of $21.32 billion, a net income of $2.82

billion, and a net worth of $5.88 billion. The company currently has an S&P rating of A/Stable.A C T U A L S I T E

8 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

LEASE ABSTRACTStarbucks1010 North Garey Avenue | Pomona, CaliforniaProperty Address 1010 Garey Avenue, Pomona, CA

Effective date Sept. 19, 2014

Tenant Starbucks Corporation

Rent Commencement Date April 2015

Primary Term 10 Years

Option Periods Four (4), five (5) year options

Lease Type NN

Maintenance - LL Responsibilities Roof, Structure, Parking, Landscaping

Insurance Landlord - Carries liability for property insurance (reimbursed by Tenant)

Taxes Landlord to pay directly. Tenant to reimburse landlord.

Utilities Tenant to pay directly

Rentable Building Area 900 square feet

Estoppel Yes, 30 day response

RENT SCHEDULEYears Monthly Installment Annual Rent

1-5 $6,030 $72,360

6-10 $6,633 $79,596

Extension Terms

11-25 $7,296 $87,555

16-20 $8,025 $96,311

21-25 $8,828 $105,942

26-30 $9,711 $116,536

A C T U A L S I T E

9 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

POMONA, CALIFORNIA

10 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

LOCATION MAP

263,340 VPD on I-10

24,392 VPD at E. Colum

bia & N. Garey

24,392 VPD at E. Columbia & N. Garey

11 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

REGIONAL TRANSIT MAP

12 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

DEMOGRAPHICS ANALYTICS

Retail Starbucks

Eastern San Gabriel Valley

2-4 StarEastern San

Gabriel Valley Los Angeles

Buildings 1 3,157 3,430 45,129

Existing SF 850 41,259,131 42,838,057 439,173,699

Average Building SF 850 13,069 12,489 9,731

Leasing

NNN Rent Per SF - $19.26 $19.16 $30.59

Vacancy Rate 0.00% 4.00% 3.90% 3.70%

Available Spaces 0 187 181 6,947

Available SF 0 2,298,133 2,343,886 24,963,454

12 Mo. Absorption SF 0 298,769 326,711 2,776,546

Population 1 Mile 3 Mile 5 Mile

2017 Total Population: 26,237 193,706 400,326

2022 Population: 27,026 199,267 412,975

Pop Growth 2017-2022: 3.01% 2.87% 3.16%

Average Age: 34.3 34.6 36.2

Households

2017 Total Households: 7,593 52,422 117,056

HH Growth 2017-2022: 3.24% 2.98% 3.28%

Median Household Inc: $42,019 $53,655 $63,186

Housing

Median Home Value: $351,407 $358,288 $422,614

Median Year Built: 1956 1964 1972

POMONA is...

GROWING3%

POPULATION GROWTH

YOUNG34

AVERAGE AGE

BUSTLING238,000

VEHICLES PER DAY ON I-10

OCCUPIED3.7%

RETAIL VACANCY

SOCIAL$957,495,000

SPENT ON DINING OUT & ALCOHOL

13 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

NET LEASE PRACTICE GROUP

D. ANDREW RAGSDALE, Esq.Senior Managing Director918.878.9535 Andrew.Ragsdale@ngkf.com

JERRY HOPKINSSenior Managing Director918.878.9536 Jerry.Hopkins@ngkf.com

KEN HEDRICKExecutive Managing Director918.878.9540 Ken.Hedrick@ngkf.com

BRANDON ROGOFFManaging DirectorNKF Retail Capital Markets415.445.5163Brandon.Rogoff@ngkf.comCA RE Lic #01949914

STARBUCKS1010 NORTH GAREY AVENUE | POMONA, CA