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STARBUCKS

OFFERING MEMORANDUM | 1010 NORTH GAREY AVENUE | POMONA, CA

STARBUCKS

1010 NORTH GAREY AVENUE | POMONA, CA

AFFILIATED BUSINESS DISCLOSURE & CONFIDENTIALITY AGREEMENT

This Offering Memorandum has been prepared by NKF Capital Markets for use by a limited number of parties and has been obtained from sources believed reliable. While we do not doubt its accuracy, we have not verified it, and make no guarantee, warranty or representation about it. It is your responsibility to confirm, independently, its accuracy and completeness. All projections have been developed by NKF, Owner and designated sources, are based upon assumptions relating to the general economy, competition, and other factors beyond the control of Owner, and therefore are subject to variation. No representation is made by NKF or Owner as to the accuracy or completeness of the information contained herein, and nothing contained herein is or shall be relied on as a promise or representation as to the future performance of the property. Although the information contained herein is believed to be correct, Owner and its employees disclaim any responsibility for inaccuracies and expect prospective purchasers to exercise independent due diligence in verifying all such information. Further, NKF, Owner and their employees disclaim any and all liability for representations and warranties, expressed and implied, contained in, or for omissions from, the Offering Memorandum or any other written or oral communication transmitted or made available to the recipient.

The Offering Memorandum does not constitute a representation that there has been no change in the business or affairs of the property or Owner since the date of preparation of the Offering Memorandum. Analysis and verification of the information contained in the Offering Memorandum is solely the responsibility of the prospective purchaser. Additional information and an opportunity to inspect the property will be made available upon written request to interested and qualified prospective investors.

Owner and NKF 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 entity at any time with or without notice. Owner shall have no legal commitment or obligations to any entity reviewing this Offering Memorandum or making an offer to purchase the property unless and until such offer is approved by Owner, a written agreement for the purchase of the property has been fully executed, delivered and approved by Owner and its legal counsel, and any obligations set by Owner thereunder have been satisfied or waived.

This Offering 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 Offering Memorandum, you agree that you will hold and treat it in the strictest confidence, that you will not photocopy or duplicate it, that you will not disclose this Offering 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 Owner or NKF and that you will use the information in this Offering Memorandum for the sole purpose of evaluating your interest in the property and you will not use the Offering Memorandum or any of the contents in any fashion or manner detrimental to the interest of Owner or NKF. If you have no interest in the property, please return the Offering Memorandum forthwith.

NET LEASE PRACTICE GROUP

KEN HEDRICK

Executive Managing Director Net Lease Practice Group ken.hedrick@ 918.878.9540

D. ANDREW RAGSDALE, Esq.

Senior Managing Director Net Lease Practice Group andrew.ragsdale@ 918.878.9535

DEBT & EQUITY FINANCE

DUSTIN STOLLY

Vice Chairman, Co-Head New York Debt/Structured Finance dustin.stolly@ 212.372.2019

SUPPORT

JEN BLADEN

Brokerage Services Net Lease Practice Group jen.bladen@ 918.878.9534

JERRY HOPKINS

Senior Managing Director Net Lease Practice Group jerry.hopkins@ 918.878.9536

BRANDON ROGOFF Managing Director NKF Retail Capital Markets 415.445.5163 Brandon.Rogoff@ RE License #01949914

JORDAN ROESCHLAUB

Vice Chairman, Co-Head New York Debt/Structured Finance JRoeschlaub@ 212.372.0755

THE TEAM

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ACTUAL SITE

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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

THE INVESTMENT

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PURCHASE PRICE $2,100,000

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

THE OFFERING

Newmark 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 HIGHLIGHTS

DENSE 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.

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THE TENANT

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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 4pm.

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.

ACTUAL SITE

7 STARBUCKS: POMONA, CALIFORNIA NET LEASE PRACTICE GROUP

LEASE ABSTRACT

Starbucks 1010 North Garey Avenue | Pomona, California

Property 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 Maintenance - LL Responsibilities Insurance

Taxes

Utilities

NN

Roof, Structure, Parking, Landscaping

Landlord - Carries liability for property insurance (reimbursed by Tenant) Landlord to pay directly. Tenant to reimburse landlord. Tenant to pay directly

Rentable Building Area

900 square feet

Estoppel

Yes, 30 day response

RENT SCHEDULE

Years

1-5 6-10 Extension Terms 11-25 16-20 21-25 26-30

Monthly Installment

$6,030 $6,633

$7,296.30 $8,025.93 $8,828.52 $9,711.38

Annual Rent

$72,360 $79,596

$87,555.60 $96,311.16 $105,942.28 $116,536.51

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ACTUAL SITE

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