Portland, Oregon

MOHAWKB U I L D I N G

VALUE-ADD MIXED-USE Investment Opportunity in the Portland CBD

Through recent leasing activity, 57% of the property’s office space has been renovated to creative-tech standards, presenting investors with a compelling investment opportunity to capitalize on an existing stabilized income stream that is anchored by Ross Dress for Less (expires 2025 with 20 years of extension options; S&P: A-) and Clinicient (expires 2019), and increase returns by repositioning and re-tenanting existing vacancy.

Newmark Grubb Knight Frank (“NGKF”), as exclusive advisor, is pleased to present the opportunity to acquire the fee simple interest in the Mohawk Building and the Mohawk Galleries Building (“The Mohawk Building”), a 69,624 square-foot, mixed-use asset prominently located in the heart of the Portland CBD. The offering consists of two connected buildings, the Mohawk Building (four stories) and the Mohawk Galleries Building (two stories) that are 77% leased to three tenants, Ross Dress for Less (21,547 SF), Clinicent (27,198 SF) and Commercial Realty Advisors (4,730 SF) and includes a 24,250 SF subterranean parking garage that can accommodate approximately ±70 vehicles.

T H E O F F E R I N G

MOHAWKB U I L D I N G

MAX Light Rail

57% of the office space is occupied by Clinicient, a physical therapy software provider, whose headcount has increased 62% in the past 2 years.

Thriving Anchor Office Tenancy43% of the office space has not yet been modernized, providing investors with the opportunity to implement a repositioning strategy to renovate the balance of the improvements and re-tenant the buildings at increased rental rates.

In the heart of the Portland tech centric CBD, which has seen abundant in-migration of technology tenants including Google, SurveyMonkey, AirB&B, and eBay.

Value-Add Opportunity

Portland’s Tech Migration

405

MAX Light Rail

MAX Light Rail

Parking revenue represents 12% of EGR.

Parking Revenue

100% of the ground floor retail space is occupied by Ross Dress for Less (S&P: A-) through 2025 with 20 years of extension options.

Fully Leased High Street Retail

I N V E S T M E N TH I G H L I G H T S

At the doorstep of 4 MAX Light Rail Lines.

Transit Oriented Destination

9.4% office vacancy rate in a market that has seen vacancy stay below 10% for over 10 years. Strong YTD net absorption of 259,019 SF in the CBD.

Strong Office Market Fundamentals

21,547Retail RSF

48,077Office RSF

69,624Total RSF

77%Occupancy

±70Parking Stalls

Combined Property Summary

Building Mohawk Building Mohawk Galleries Building

Address 708-724 SW 3rd Avenue 733 SW 2nd Avenue

City, State Portland, OR Portland, OR

# of Floors 4 2

Parcel Number R245981 R245979

Year Built 1902 1946

P R O P E R T YS U M M A R Y

Creative Office Repositioning OpportunityCurrent ownership recently repositioned Clinicient’s space (57% of office NRA) to creative office, however the balance of the office space would benefit from a creative office renovation. With Portland CBD creative-tech rents quickly surpassing $30.00 PSF FSG, in-place rents at the Mohawk Building could be increased as much as 30%, if a repositioning program was properly implemented. These image conscious tech tenants are drawn to downtown’s urban lifestyle and have repeatedly demonstrated a willingness to pay a significant premium for the high-end restored creative office space required to attract and retain talent.

Historic Mixed Use Downtown AssetThe Mohawk Building was originally built in 1902 for Portland’s famed Robert’s Bros. Department Store. The Mohawk Galleries Building was added in the 1940s when the company expanded into household furnishings. Today, the iconic brick-clad building is prominently located at the corners of SW 3rd Avenue and of SW Morrison (Mohawk Building) and SW Yamhill and SW 2nd Avenue (Mohawk Galleries Building). The Property’s multi-building layout provides various suite sizes ranging from 2,000 SF to 21,000 SF, which caters to the growing population of creative/progressive tenants seeking open, collaborative workspaces, lofty ceilings heights, and exposed brick surfaces.

Stable In-Place Tenancy with Upside Potential The Mohawk Building is currently 77% leased, offering stable near term cash flow anchored by Ross (expires 1/25) and Clinicient (expires 12/19). A strategic capital improvement plan will provide investors the opportunity to significantly enhance future cash flows and capitalize on Portland’s rental rate appreciation, which totaled 8.4% in 2015 and is forecasted to increase 15% by 2019*. Nearly 40% of the Property’s rent roll expires by 2019, providing an investor the opportunity to increase cash flow both through the lease-up of existing vacant space and by rolling leases to premium market rates as they expire. *Property Portfolio Research 2Q 2016, Portland CBD.

37% since 2010in the Portland CBD.

Office rents have risen

Stable Anchor Office Tenancy57% of the Property’s office space is occupied by Clinicient, a Portland based billing management system provider for physical therapists. With nearly $1 billion in payments under management, Clinicient supports thousands of therapists across the US. The company has experienced incredible growth – more than doubling in size over the past two years.

Investment Grade Retail TenancyThe Mohawk Building benefits from excellent credit tenancy with Ross Dress for Less (NASDAQ: ROST; S&P: A-), who occupies the ground floor retail space that spans both the Mohawk and the Mohawk Galleries Buildings. With nine years of remaining term and 20 years of below market options to extend, Ross provides the Property with the benefit of a long term credit income stream that compliments the income derived from office rents in the floors above.

Premier Retail Destination 31% of the Mohawk Building’s NRA is retail, and the Property benefits from an irreplaceable location at the core of Portland’s CBD shopping district. With visibility of GGP’s upscale Pioneer Place Mall (including Louis Vuitton, H&M, Kate Spade, J.Crew, Michael Koors, and Tory Burch), just two blocks from the Apple Store, and within walking distance of Nordstrom’s Portland flagship store, the Mohawk Building’s retail tenancy has consequently thrived, given the concentration of pedestrian shopping that this location affords.

Thriving, Technology Driven EconomyInspired by a growing technology concentration and attractive quality of life, the Portland market has seen an influx of new jobs, dropping the city’s unemployment rate to a 15 year low of 4.4%. Since 2010, office vacancy has remained in the single digits and office rents have risen 37% to $29.82 FSG, largely a result of the growth of TECH TENANTS in this market.

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True Transit-Oriented Location The Mohawk Building is a true transit-oriented property with a WalkScore® of 97, a TransitScore® of 92 and a BikeScore® of 98. The Property sits directly adjacent to Trimet’s transit mall, in between the westbound and eastbound MAX light-rail lines, and is just two blocks west of Portland’s Morrison bridgehead, which provides direct bike access to Portland’s southeast residential neighborhoods and vehicle access to Interstate 5 and Highway 99E. Also in close proximity to the property are access points for Interstate 405, Highway 43, and Highway 26.

98BikeScore

92TransitScore

97WalkScore

MOHAWKB U I L D I N G

Kevin ShannonPresident, West Coast Capital MarketsT +1 310 491 2005kevin.shannon@ngkf.comCA RE License #00836549

Ken WhiteExecutive Managing DirectorT +1 310 491 2006ken.white@ngkf.comCA RE License #01788506

Laura StummManaging DirectorT +1 310 491 2020laura.stumm@ngkf.comCA RE License #01914207

Institutional Investment Contacts

David HillSenior Managing DirectorT +1 503 972 5510dhill@ngkf.comOR RE License #871000083

Wendy HillAssociateT +1 503 972 5509wendy.hill@ngkf.comOR RE License #200511173

Local Investment Contacts

David SquireSenior Managing DirectorT +1 503 972 5505dsquire@ngkf.comOR RE License #900100192

Local Leasing Contact

David MilestoneExecutive Managing DirectorT +1 310 491 2015david.milestone@ngkf.comCA RE License #01515842

Brett GreenManaging DirectorT +1 310 491 2009brett.green@ngkf.comCA RE License #01892016

Financing Contacts

NGKF Corporation License #0135549. The broker for a purchaser of the property shall be entitled to receive a real estate commission only in the event that broker and the property’s owner execute a written commission agreement, containing the manner of calculation of that commission and all conditions to its payment, and the satisfaction of those conditions. Absent a written agreement to the contrary between that broker and NGKF, that broker shall not look to NGKF for payment of such a commission or any other compensation. Although all information furnished regarding property for sale, lease, or financing has been obtained from sources deemed to be reliable, that information has not been verified by NGKF and no express representation is made nor is any to be implied as to the accuracy thereof. That information is subject to errors, omissions, change of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice and to any special conditions imposed by NGKF’s client.