O’Reilly Auto Parts - Matthews

TM

OFFERING MEMORANDUM

O'Reilly Auto Parts

709 W RANKIN RD | HOUSTON, TX

*Photos taken 9/9/17

CONTENTS

3 EXECUTIVE SUMMARY 4 F I NA N CIA L A N A LYS IS 6 TENANT OVERVIEW 7 PROPERTY OVERVIEW 9 AREA OVERVIEW

*Photos taken 9/9/17

EXCLUSIVELY LISTED BY

Bruce Eversole

Associate Bruce.Eversole@ DIR (214) 692-2102 MOB (409) 256-3370 LIC # 686482 (TX)

Josh Bishop

VP & Director Josh.Bishop@ DIR (214) 692-2289 MOB (315) 730-6228 LIC # 688810 (TX)

chad kurz

SVP & National Director Chad.Kurz@ DIR (214) 692-2927 MOB (562) 480-2937 LIC # 01911198 (CA)

executive summary

investment highlights

Property Highlights:

? Ideal 1031 exchange property for an investor seeking a steady passive source of income ? Rare 20-year lease with ?18.25 years remaining on the base term with a strong corporate guarantee ? Growing cash flow ? extremely attractive 6% rent increase in years 11 and 16 ? Newer 2015 construction ? property was built to O'Reilly's most recent prototype ? Retail NNN lease ? landlord is responsible for roof and structure only ? Roof Warranty ? subject property comes with a 20-year roof warranty, property acts as absolute NNN

Location Highlights:

? Income Tax-Free State ? Texas is one of the few states with no state income tax ? Strong Traffic Counts ? strategically located on Rankin Road which boasts more than 26,000 vehicles daily ? Strategic Location ? located directly across the street from the US Army Reserve Center and the National Guard ? 5-Mile population exceeds 304,000 residents ? Growing Population ? projected population growth of nearly 12% over the next 5 years! ? Local retail tenants include Family Dollar, Walgreens, Sonic, McDonald's, Shell, Chevron, Jack in the Box, Wells Fargo, McAlister's

Deli, CVS, and many more ? Houston is the most populous city in the state of Texas and the fourth most populous city in the United States ? Houston has been ranked the #1 fastest growing city

Tenant Highlights:

? Most Stable Outlook ? O'Reilly Automotive Stores, Inc. (NYSE: ORLY) has the highest investment grade credit rating of all the auto parts retailers (S&P rated BBB+)

? Strong corporate guarantee from an investment grade credit tenant ? Expansion Mode ? O'Reilly has ?190 new stores slated for 2017 in addition to their ?4,712 current locations ? Strong Market Cap ? O'Reilly Auto has a market cap of ?17.5 Billion ? O'Reilly reported $8.6 Billion of revenue in 2016

Houston, TX | 3

financial analysis

*Photos taken 9/9/17

4 | Matthews

O'Reilly Auto Parts

709 W Rankin Rd Houston, TX 77067 List Price ........................................................................................................$1,603,773 CAP Rate - Current.............................................................................................. 5.30% Gross Leasable Area ................................................................................. ? 6,800 SF Lot Size .....................................................................................? 0.73 Acres (31,992) Year Built...................................................................................................................2015

*Photos taken 9/9/17

Annualized Operating Data

Monthly Rent Annual Rent

Years 1-10

$7,082.24

$84,986.88

Years 11-15

$7,507.17

$90,086.04

Years 16-20

$7,957.16

$95,485.92

Option 1

$8,435.06

$101,220.72

Option 2

$8,941.16

$107,293.92

Option 3

$9,477.63

$113,731.56

Option 4

$10,046.29

$120,555.48

RPSF $12.50 $13.25 $14.04 $14.89 $15.78 $16.73 $17.73

Cap Rate 5.30% 5.62% 5.95% 6.31% 6.69% 7.09% 7.52%

Tenant Summary

Tenant Trade Name Type of Ownership Lease Guarantor Lease Type Roof & Structure Original Lease Term Rent Commencement Date Lease Expiration Date Term Remaining on Lease Increases Options

O'Reilly Auto Parts Fee Simple Corporate NN+

20 Year Warranty 20 Years

December 2015 December 2035

? 18.25 Years 6% in Years 11, 16, and Every Option

Four, 5-Year Options

Houston, TX | 5

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