1HOUSTON, TEXAS

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O F F E R I N G M E M O R A N D U M8 5 3 5 C E K i n g Pa r k w a y, H o u s t o n , T X

2 FAMILY DOLLAR STRIP CENTER

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EXCLUSIVE LISTING AGENTS:

BROKER OF RECORD:

JOSH BISHOPVP & Director

josh.bishop@matthews.comDIR 214.692.2289MOB 315.730.6228LIC # 688810 (TX)

KYLE MATTHEWSBROKER OF RECORDLIC # 678067 (TX)

JORDAN POWELLAssociate

jordan.powel l@matthews.comDIR 214.692.2160MOB 916.844.6454LIC # 01982070 (CA)

3HOUSTON, TEXAS

CONTENT

4EXECUTIVE SUMMARY

6AREA OVERVIEW

10PROPERTY DETAILS

12FINANCIAL OVERVIEW

14TENANT OVERVIEWS

4 FAMILY DOLLAR STRIP CENTER

INVESTMENT HIGHLIGHTS• Value Add Strip Center: 1,100 SF vacancy provides an investor

with significant upside

• High Performing Anchor: Family Dollar’s sales volume is nearly 2x the national average; Very healthy Rent-to-Sales ratio of 3.08%

• Percentage Rent Clause: Family Dollar is required to report their sales annually and they’re rapidly approaching the break point for percentage rent

• Proven Location: Family Dollar initially occupied 8,000 SF and was preforming at such fast pace they opted to expand into an additional 1,400 SF, giving them a total of 9,400 SF

• Strong Domino’s Franchisee: BKD Pizza, Inc. operates ± 8 locations in the Houston MSA

• Double-digit cash-on-cash levered return

• Located directly across the street from C.E. King Middle School and High School (enrollment of more than 2,000 students)

• Traffic counts of more than 12,000 vehicles daily on C.E. King Parkway

• Population: 3-mile population of more than 46,000 residents and 5-mile population in excess of 142,000 residents

• Growing Demographics: Population is expected to increaseby more than 10% over the next 5 years

• Strong Houston Market: Houston is the most populous city inthe state of Texas and the fourth-most populous in the UnitedStates

• Solid Household Incomes: Average household income within1-mile radius of the subject property of ± $70,000 annually

• Parking lot recently re-striped in June 2017

• Family Dollar was recently acquired by Dollar Tree, Inc. and isnow considered to be the nation’s largest small box discountretailer

• Family Dollar and Dollar Tree combined have more than13,500 locations nationwide

• Standard & Poor’s credit rating of BB+

EXECUTIVE SUMMARY

HOUSTON, TEXAS 5

FINANCIAL HIGHLIGHTS

Price $1,267,000

Capitalization Rate 7.75%

Gross Leasable Area (GLA) ± 11,900 SF

Year Built 2002

Current Occupancy 90.8%

In Place Income

Effective Gross Income $155,937

Operating Expenses $57,737

Net Operating Income $98,200

6

The city of Houston, Texas is located in southeastern part of the state near the Gulf of Mexico. It is the most populous city in Texas and the fourth most populous city in the United States. Known as the Bayou City for its waterway system, Houston thrives because it is a great place to work and a great place to live. Alive with energy and rich in diversity, Houston is a dynamic mix of imagination, talent and first-class attractions that makes it a world-class city. It exudes a cosmopolitan and down-home vibe while being nicknamed the “Space City”. With more than 2.2 million residents, Houston attracts visitors and transplants with a wonderful mix of world-class arts, booming business, pro sports and award-winning cuisine.

HOUSTON, TEXASFASTEST-GROWING CITY#1

MOST POPULOUS CITY IN THE U.S.4TH

PROPERTY DEMOGRAPHICS

POPULATION 3-Mile 5-Mile 7-Mile

2022 Projection 51,130 154,309 318,216

2017 Estimate 46,868 142,740 294,549

Growth 2017 - 2022 9.09% 8.11% 8.04%

Growth 2010 - 2017 15.34% 12.85% 13.51%

HOUSEHOLDS 3-Mile 5-Mile 7-Mile

2022 Projection 14,525 47,198 97,326

2017 Estimate 13,368 43,826 90,297

Growth 2017 - 2022 8.65% 7.69% 7.78%

Growth 2010 - 2017 14.05% 11.69% 12.94%

INCOME 3-Mile 5-Mile 7-Mile

2017 Est. Average Household Income

$68,676 $62,943 $65,319

AREA OVERVIEW

6

7HOUSTON, TEXAS

Houston is a city of endless possibilities: Its history has been marked with achievements from the first word heard from the moon to the first artificial heart transplant. A distinctly favorable business climate promotes trade, commerce, industry and economic growth in the Houston region. Many businesses recognize the allure of all Houston has to offer; There are twenty-five Fortune 500 companies that call the Energy Capital of the World home. Once dominated by oil-related jobs, Houston’s economy has diversified as new, core industries join energy in the regional employment mix.

With a strong infrastructure and a highly-trained workforce, Houston has the resources to support its growing industries, namely energy, health care, nanotechnology, aerospace, and information technology. The Port of Houston, one of the region’s greatest assets, ranks as the nation’s largest port in international tonnage and second in total tonnage. It is an economic engine that produces jobs and economic prosperity for the local Houston and state economy. Throughout its history, whenever the port has grown, Houston has also grown, showing that it has been instrumental in the city’s development as a center of international trade.

A richly-diverse pool of skilled, multilingual, multicultural workers is one of the city’s key advantages that, making it an attractive city for relocating and expanding businesses. Nearly 25 percent of all adults have completed four years of college, surpassing the national average, while the median age is three years younger than the national average. This diverse workforce possesses a variety of skills and occupations ranging from medical professionals and engineers to production managers and accountants. Aeronautic research is unsurpassed at NASA headquarters and Texas Medical Center remains the largest in the world with 47 highly lauded research and treatment institutions.

BUSINESS CLIMATE

7

MAJOR EMPLOYERS

8 FAMILY DOLLAR STRIP CENTER

THE CITY WITH NO LIMITS

Characterized by unprecedented growth and opportunity and a limitless future, Houston has one of the youngest, most innovative and diverse populations in the world. Implemented by the Greater Houston Partnership, a coalition of over 1,000 companies, and its the City With No Limits campaign has catalyzed an economic resurgence. Meant to enhance Houston’s image and attract talent to the community, the City With No Limits campaign positions Houston as a city with an innovative and growing business community as well as a dynamic cultural and livable city with an high quality of life.

Manufacturing is making a comeback in the local economy, which can largely be attributed to the City With No Limits. From robotics and automated solutions that are revolutionizing the energy industry to NASA-backed technology that is driving life sciences and medical advancements into new frontiers, Houston is the right place for manufacturers to grow and prosper.

People move to Houston from all over the world to take advantage of the abundant opportunities the region provides: Houston is the place where hard work can achieve the American Dream.

Houston maintains a global position as an international trade leader with economic and cultural ties reaching across the globe. As one of only five cities in the world connecting to all six inhabited continents, Houston is a global manufacturing and logistics hub and an international finance center. Indicating the city’s strong presence in the overseas marketplace, more than 3,440 area firms, foreign government offices and nonprofit organizations are involved in international business. Furthermore, an approximate 800 Houston firms report foreign ownership and 430 Houston companies have offices abroad in 144 countries.

From the Port of Houston to the Houston Airport System, the city has an impressive array of logistical and distribution channels capable of meeting the demands of today’s fast-paced market. Added to the region’s central geographic location, Houston has easy access to the global marketplace, making it an ideal place for businesses looking to engage in international business.

Texas is the largest exporter in the United States and Houston has 17 sister-city relationship promoting business opportunities across Africa, Asia, Australia, Europe and the Americas.

HOUSTON AS A GLOBAL CITY

9HOUSTON, TEXAS

DOWNTOWN HOUSTON

Houston’s downtown has been revitalized with numerous clubs, professional sports facilities and musical entertainment that has helped bring nightlife back to downtown. As one of the few U.S. cities with resident companies in theater, ballet, symphony and opera, Houston’s Theater District, located in downtown, offers visitors and residents alike exciting performances all season long. The city also shows its devotion to the arts through a full complement of art museums and critically acclaimed galleries in its Museum District.

Countless cutting-edge chefs have made a home in Houston, where diners eat out more than residents of any other city. There are more than 10,000 restaurants

in the Houston area with culinary choices that represent more than 70 countries and American regions. This stylish dining scene only provides a glimpse of Houston’s epicurean offerings, a fact that the city’s culinary masterminds intent to prove with the Houston Culinary Tours.

Houston’s Downtown Aquarium is a public aquarium and restaurant that was developed from two Houston landmarks: Fire Station No. 1 and the Central Waterworks Building. It houses over 200 species of aquatic animals in 500,000 gallons of aquariums. The complex includes two restaurants, a bar, and banquet facilities.

The Museum of Fine Arts located within the Houston Museum District, is one of the largest museums in the United States. The permanent collection of the museum spans more than 6,000 years of history with approximately 64,000 works from six continents. Each year, 1.25 million people benefit from the museum’s programs, workshops and resource centers.

MUSEUM OF FINE ARTS

As the largest mall in Texas and ninth largest in the country, the Galleria is an upscale mixed-use urban development centrally located in the Uptown District of Houston. With 35 million annual visitors, The Galleria has been named the most visited attraction in Houston. On top of an ice skating rink, the mall holds over 375 stores and is currently anchored by Neiman Marcus, Nordstrom, Saks Fifth Avenue and Macy’s.

THE GALLERIA

FAMILY DOLLAR STRIP CENTER

Property Name Family Dollar Strip Center

Address 8535 C E King Parkway

Location Houston, TX 77044

Cross Street Crenshaw Blvd

Gross Leasable Area ±11,900

Land Area ± 40,000 SF (± 0.92 Acres)

APN(s) 1227100010001

Year Built 2002

Type of Ownership Fee Simple

Number of Stories 1

Number of Buildings 1

Parking Spaces ± 34

Parking Ratio 3.09 : 1,000 SF

PHYSICAL DESCRIPTION

PROPERTY DETAILS

NAP

C E KING PKWY C E KING PKWY

TRAFFIC COUNTS

C E KING PARKWAY: 12,000 ADT

SITE PLAN

10

1 1HOUSTON, TEXAS

12 FAMILY DOLLAR STRIP CENTER

FINANCIAL OVERVIEW

13HOUSTON, TEXAS

Tenant Lease Start Lease End GLA (SF) % of GLAContract Rental Rate Rent PSF

OptionsYear Month Year Month

Family Dollar Oct-01 Dec-22 9,400 79.0% $81,154 $6,763 $8.63 $0.72 Three (3), Five (5)

Year Options

Vacant - - 1,100 9.2% $16,500 $1,375 $15.00 $1.25 -

Domino's May-15 Apr-20 1,400 11.8% $24,816 $2,068 $17.73 $1.48 Two (2), Five (5)

Year Options

Occupied Totals - In Place 10,800 90.8% $105,970 $8,831 $9.81 $0.82

Vacant Totals 1,100 9.2% $16,500 $1,375 $15.00 $1.25

Totals 11,900 100.0% $122,470 $10,206 $10.29 $0.86

RENT ROLL

YearIn Place (Year 1)

Total $/SF

Income

Rental Income $105,970 $8.91

Expense Reimbursements $49,967 $4.05

Effective Gross Income $155,937 $12.96

Expenses

Real Estate Taxes $32,540 $2.73

Property Insurance $8,234 $0.69

CAM/R&M $12,280 $1.03

Management $4,683 $0.39

EGI (%) 3.00%

Operating Expenses $57,737 $4.85

Net Operating Income $98,200 $8.11

Operating Expense Ratio 37%

INCOME & EXPENSESINCOME DISTRIBUTION

Tenant Name In Place Rent % of Income Expiration Date

Family Dollar $6,763 76.6% Dec-22

Domino's $2,068 23.4% Apr-20

Totals $8,831 100.0%

SUMMARY TENANT PROFILE

14 FAMILY DOLLAR STRIP CENTER

Domino’s Pizza runs the world’s second largest pizza chain with an emphasis on stores principally being delivery locations in lieu of dine-in restaurants. Their menu features several different styles of pizza with a wide array of topping options, as well as additional items such as bread sticks, cheese bread, and chicken wings.

The company leads the pizza delivery segment with nearly 30% of the market share. Domino’s relies heavily on franchising for both its dominant position in the pizza delivery market and the bulk of its revenue. Through the delivery-store format of their locations, Domino’s has been able to expand rapidly as the startup and maintenance costs are low for franchisees. Currently, Domino’s is making a big push to expand its international franchise network. The company itself owns and operates about 385 locations in the US whereas the rest are franchised.

DOMINO'S

Property Name Domino's Pizza

Ownership Public

No. of Locations ± 12,500

No. of Employees ± 14,100

Headquartered Ann Arbor, MI

Website www.dominos.com

Year Founded 1960

Property Name Family Dollar

Ownership Public

No. of Locations (All) ± 8,000

No. of Employees (All) ± 60,000

Headquartered Matthews, North Carolina

Website www.familydollar.com

Year Founded 1986

When it comes to getting value for everyday items for the entire family in an easy to shop, neighborhood location, Family Dollar is the best place to go. One of the nation’s fastest growing retailers, Family Dollar offers a compelling assortment of merchandise for the whole family ranging from household cleaners to name brand foods, from health and beauty aids to toys, from apparel for every age to home fashions, all for everyday low prices. While shoppers can find many items at $1 or less, most items in the store are priced below $10, which makes shopping fun without stretching the family budget.

Family Dollar serves families in more than 8,000 neighborhoods in 46 states. Texas is its largest market with 1,027 stores, followed by Florida with 584 stores. The Dollar Tree merger with Family Dollar now creates a combined organization with sales exceeding $19 billion annually with more than 13,600 stores across 48 states and five Canadian Provinces. The merger has allowed Family Dollar to grow offering broader, more compelling merchandise assortments, with greater values, to a wider array of customers.

FAMILY DOLLAR

TENANT OVERVIEWS

15HOUSTON, TEXAS

11-2-2015

Information About Brokerage ServicesTexas law requires all real estate license holders to give the following informaƟon about

brokerage services to prospecƟve buyers, tenants, sellers and landlords.

TYPES OF REAL ESTATE LICENSE HOLDERS: .• A BROKER is responsible for all brokerage acƟviƟes, including acts performed by sales agents sponsored by the broker. • A SALES AGENT must be sponsored by a broker and works with clients on behalf of the broker.

A BROKER’S MINIMUM DUTIES REQUIRED BY LAW (A client is the person or party that the broker represents): • Put the interests of the client above all others, including the broker’s own interests; • Inform the client of any material informaƟon about the property or transacƟon received by the broker; • Answer the client’s quesƟons and present any offer to or counter-offer from the client; and • Treat all parƟes to a real estate transacƟon honestly and fairly.

A LICENSE HOLDER CAN REPRESENT A PARTY IN A REAL ESTATE TRANSACTION:

AS AGENT FOR OWNER (SELLER/LANDLORD): The broker becomes the property owner's agent through an agreement with the owner, usually in a wriƩen lisƟng to sell or property management agreement. An owner's agent must perform the broker’s minimum duƟes above and must inform the owner of any material informaƟon about the property or transacƟon known by the agent, including informaƟon disclosed to the agent or subagent by the buyer or buyer’s agent.

AS AGENT FOR BUYER/TENANT: The broker becomes the buyer/tenant's agent by agreeing to represent the buyer, usually through a wriƩen representaƟon agreement. A buyer's agent must perform the broker’s minimum duƟes above and must inform the buyer of any material informaƟon about the property or transacƟon known by the agent, including informaƟon disclosed to the agent by the seller or seller’s agent.

AS AGENT FOR BOTH - INTERMEDIARY: To act as an intermediary between the parƟes the broker must first obtain the wriƩen agreement of each party to the transacƟon. The wriƩen agreement must state who will pay the broker and, in conspicuous bold or underlined print, set forth the broker's obligaƟons as an intermediary. A broker who acts as an intermediary:

• Must treat all parƟes to the transacƟon imparƟally and fairly; • May, with the parƟes' wriƩen consent, appoint a different license holder associated with the broker to each party (owner and

buyer) to communicate with, provide opinions and advice to, and carry out the instrucƟons of each party to the transacƟon. • Must not, unless specifically authorized in wriƟng to do so by the party, disclose:

ᴑ that the owner will accept a price less than the wriƩen asking price; ᴑ that the buyer/tenant will pay a price greater than the price submiƩed in a wriƩen offer; and ᴑ any confidenƟal informaƟon or any other informaƟon that a party specifically instructs the broker in wriƟng not to

disclose, unless required to do so by law.

AS SUBAGENT: A license holder acts as a subagent when aiding a buyer in a transacƟon without an agreement to represent the buyer. A subagent can assist the buyer but does not represent the buyer and must place the interests of the owner first.

TO AVOID DISPUTES, ALL AGREEMENTS BETWEEN YOU AND A BROKER SHOULD BE IN WRITING AND CLEARLY ESTABLISH: • The broker’s duƟes and responsibiliƟes to you, and your obligaƟons under the representaƟon agreement. • Who will pay the broker for services provided to you, when payment will be made and how the payment will be calculated.

LICENSE HOLDER CONTACT INFORMATION: This noƟce is being provided for informaƟon purposes. It does not create an obligaƟon for you to use the broker’s services. Please acknowledge receipt of this noƟce below and retain a copy for your records.

Licensed Broker /Broker Firm Name or Primary Assumed Business Name

License No. Email Phone

Designated Broker of Firm License No. Email Phone

Licensed Supervisor of Sales Agent/Associate

License No. Email Phone

Sales Agent/Associate’s Name License No. Email Phone

Regulated by the Texas Real Estate Commission

Buyer/Tenant/Seller/Landlord Initials

InformaƟon available at www.trec.texas.gov IABS 1-0

Date

Kyle Matthews/Matthews Retail Group Inc. 678067 kyle.matthews@matthews.com (310) 919-5757

Kyle Matthews 678067 kyle.matthews@matthews.com (310) 919-5757

17HOUSTON, TEXAS

This Offer ing Memorandum contains select informat ion pertaining to the business and af fa i rs of the Family Dollar Strip Center located at 8535 C E King Parkway, Houston, TX 77044 (“Property”) . I t has been prepared by Matthews Real Estate Investment Services. This Offer ing Memorandum may not be al l - inclusive or contain a l l of the informat ion a prospect ive purchaser may desire. The informat ion contained in th is Offer ing Memorandum is conf ident ia l and furnished solely for the purpose of a review by a prospect ive purchaser of the Property. I t is not to be used for any other purpose or made avai lable to any other person without the wri t ten consent of Sel ler or Matthews Real Estate Investment Services. The mater ia l is based in part upon informat ion suppl ied by the Sel ler and in part upon f inancial informat ion obtained from sources i t deems rel iable. Owner, nor their of f icers , employees, or agents makes any representat ion or warranty, express or impl ied, as to the accuracy or completeness of th is Offer ing Memorandum or any of i ts contents and no legal l iabi l i ty is assumed or shal l be impl ied with respect thereto. Prospect ive purchasers should make their own project ions and form their own conclusions without rel iance upon the mater ia l contained herein and conduct their own due di l igence.

By acknowledging your receipt of th is Offer ing Memorandum for the Property, you agree:

1 . The Offer ing Memorandum and i ts contents are conf ident ia l ;

2 . You wi l l hold i t and treat i t in the str ictest of conf idence; and

3. You wi l l not , d i rect ly or indirect ly, d isclose or permit anyone else to disclose this Offer ing Memorandum or i ts contents in any fashion or manner detr imental to the interest of the Sel ler.

Owner and Matthews Real Estate Investment Services expressly reserve the r ight , at their sole discret ion, to reject any and al l expressions of interest or of fers to purchase the Property and to terminate discussions with any person or ent i ty reviewing this Offer ing Memorandum or making an of fer to purchase the Property unless and unt i l a wr i t ten agreement for the purchase and sale of the Property has been ful ly executed and del ivered.

I f you wish not to pursue negot iat ions leading to the acquis i t ion of the Property or in the future you discont inue such negot iat ions, then you agree to purge al l mater ia ls relat ing to th is Property including this Offer ing Memorandum.

A prospect ive purchaser ’s sole and exclusive r ights with respect to th is prospect ive t ransact ion, the Property, or informat ion provided herein or in connect ion with the sale of the Property shal l be l imited to those expressly provided in an executed Purchase Agreement and shal l be subject to the terms thereof. In no event shal l a prospect ive purchaser have any other c la ims against Sel ler or Matthews Real Estate Investment Services or any of their af f i l iates or any of their respect ive of f icers , Directors , shareholders, owners, employees, or agents for any damages, l iabi l i ty, or causes of act ion relat ing to th is sol ic i tat ion process or the market ing or sale of the Property.

This Offer ing Memorandum shal l not be deemed to represent the state of af fa i rs of the Property or const i tute an indicat ion that there has been no change in the state of af fa i rs of the Property s ince the date this Offer ing Memorandum.

C O N F I D E N T I A L I T Y & D I S C L A I M E R S TAT E M E N T

™

EXCLUSIVE LISTING AGENTS:

JOSH BISHOPVP & Director

josh.bishop@matthews.comDIR 214.692.2289MOB 315.730.6228LIC # 688810 (TX)

KYLE MATTHEWSBROKER OF RECORDLIC # 678067 (TX)

JORDAN POWELLAssociate

jordan.powel l@matthews.comDIR 214.692.2160MOB 916.844.6454LIC # 01982070 (CA)

BROKER OF RECORD: