Subject Property SWISS FARMS A SUBSIDIARY OF FARM STORES

OFFERING MEMORANDUM 730 South Chester Road - Swarthmore, PA 19081 EXCLUSIVE NET- LEASE OFFERING Confidentiality and Disclaimer

Marcus & Millichap hereby advises all prospective purchasers of in part or in whole due to market, economic, environmental or completeness of the information provided. All potential buyers Net Leased property as follows: other conditions. Regardless of tenant history and lease must take appropriate measures to verify all of the information guarantees, Buyer is responsible for conducting his/her own set forth herein. The information contained in this Marketing Brochure has been investigation of all matters affecting the intrinsic value of the obtained from sources we believe to be reliable. However, property and the value of any long-term lease, including the NON-ENDORSEMENT NOTICE Marcus & Millichap has not and will not verify any of this likelihood of locating a replacement tenant if the current tenant information, nor has Marcus & Millichap conducted any should default or abandon the property, and the lease terms that Marcus & Millichap Real Estate Investment Services, Inc. investigation regarding these matters. Marcus & Millichap makes Buyer may be able to negotiate with a potential replacement (“M&M”) is not affiliated with, sponsored by, or endorsed by any no guarantee, warranty or representation whatsoever about the tenant considering the location of the property, and Buyer’s legal commercial tenant or lessee identified in this marketing package. accuracy or completeness of any information provided. ability to make alternate use of the property. The presence of any corporation’s logo or name is not intended By accepting this Marketing Brochure you agree to release to indicate or imply affiliation with, or sponsorship or As the Buyer of a net leased property, it is the Buyer’s Marcus & Millichap Real Estate Investment Services and hold it endorsement by, said corporation of M&M, its affiliates or responsibility to independently confirm the accuracy and harmless from any kind of claim, cost, expense, or liability arising subsidiaries, or any agent, product, service, or commercial listing completeness of all material information before completing any out of your investigation and/or purchase of this net leased of M&M, and is solely included for the purpose of providing purchase. This Marketing Brochure is not a substitute for your property. tenant lessee information about this listing to prospective thorough due diligence investigation of this investment customers. opportunity. Marcus & Millichap expressly denies any obligation CONFIDENTIALITY AND DISCLAIMER to conduct a due diligence examination of this Property for ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE Buyer. The information contained in the following Marketing Brochure CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE is proprietary and strictly confidential. It is intended to be DETAILS. Any projections, opinions, assumptions or estimates used in this reviewed only by the party receiving it from Marcus & Millichap Marketing Brochure are for example only and do not represent and should not be made available to any other person or entity Special COVID-19 Notice the current or future performance of this property. The value of without the written consent of Marcus & Millichap. This All potential buyers are strongly advised to take advantage of their a net leased property to you depends on factors that should be Marketing Brochure has been prepared to provide summary, opportunities and obligations to conduct thorough due diligence and evaluated by you and your tax, financial and legal advisors. unverified information to prospective purchasers, and to seek expert opinions as they may deem necessary, especially given establish only a preliminary level of interest in the subject the unpredictable changes resulting from the continuing COVID-19 Buyer and Buyer’s tax, financial, legal, and construction advisors property. The information contained herein is not a substitute pandemic. Marcus & Millichap has not been retained to perform, should conduct a careful, independent investigation of any net for a thorough due diligence investigation. Marcus & Millichap and cannot conduct, due diligence on behalf of any prospective leased property to determine to your satisfaction with the has not made any investigation, and makes no warranty or purchaser. Marcus & Millichap’s principal expertise is in marketing investment properties and acting as intermediaries between buyers suitability of the property for your needs. representation, with respect to the income or expenses for the and sellers. Marcus & Millichap and its investment professionals subject property, the future projected financial performance of cannot and will not act as lawyers, accountants, contractors, or Like all real estate investments, this investment carries the property, the size and square footage of the property and engineers. All potential buyers are admonished and advised to significant risks. Buyer and Buyer’s legal and financial advisors improvements, the presence or absence of contaminating engage other professionals on legal issues, tax, regulatory, financial, must request and carefully review all legal and financial substances, PCB’s or asbestos, the compliance with State and and accounting matters, and for questions involving the property’s documents related to the property and tenant. While the Federal regulations, the physical condition of the improvements physical condition or financial outlook. Projections and pro forma tenant’s past performance at this or other locations is an thereon, or the financial condition or business prospects of any financial statements are not guarantees and, given the potential important consideration, it is not a guarantee of future success. tenant, or any tenant’s plans or intentions to continue its volatility created by COVID-19, all potential buyers should be Similarly, the lease rate for some properties, including newly- occupancy of the subject property. The information contained in comfortable with and rely solely on their own projections, analyses, constructed facilities or newly-acquired locations, may be set this Marketing Brochure has been obtained from sources we and decision-making.) based on a tenant’s projected sales with little or no record of believe to be reliable; however, Marcus & Millichap has not actual performance, or comparable rents for the area. Returns verified, and will not verify, any of the information contained Activity ID: ZAB0330851 are not guaranteed; the tenant and any guarantors may fail to herein, nor has Marcus & Millichap conducted any investigation pay the lease rent or property taxes, or may fail to comply with regarding these matters and makes no warranty or other material terms of the lease; cash flow may be interrupted representation whatsoever regarding the accuracy or Representative Photo

Table of Contents Investment Highlights 4 Financial Analysis 5 Tenant Overview 6 In Recent News 7 Surrounding Area 8 Location Overview 9 Local Map 10 Regional Map 11 Demographics / Market Overview 12-13 Investment Highlights PRICE: $1,713,957 | CAP: 6.00% | RENT: $102,837

Subject Property About the Investment  Long-Term, 20-Year Absolute Triple Net (NNN) Lease Strong Hedge Against Inflation | Attractive Rental Increases of Three Percent (3%) Annually Starting in Year 3  There are Two, Five-Year Tenant Renewal Options, Bringing the Potential Lease Term to 30 Years

About the Location  Strong Demographics| Population Exceeds 271,800 Within a Five-Mile Radius and 994,650 Individuals Within a Ten-Mile Radius  High Visibility and Ease of Access | South Chester Road and Interstate-476| Average Daily Traffic Counts of 10,900 and 86,000 Vehicles, Respectively  Strong Academic Presence | Swarthmore College| Total Enrollment Exceeds 1,600 Students | Located Within a One-Mile Radius  Affluent Population | Household Income Exceeds $95,320 within a Three-Mile Representative Photo Radius  Prime Positioning to Target Markets | Situated 10 Miles Outside , PA | Philadelphia International Airport Serves Over 31.7M Passengers Annually

About the Brand  Farm Stores Acquired Swiss Farms and Intends to Re-Brand All 11 Swiss Farms Locations, Which are Located Throughout  Farm Stores is America’s Largest and Oldest Drive-Thru Convenience Store  A hybrid Grocery Store, Bakery and Restaurant With a Double Drive-Thru, Which Makes Farm Stores Concept One-Of-a-Kind  There Are Currently 70 Farm Stores With Rapid Expansion Plans | Scheduled to Break Ground on 30-40 Units Over the Next 12 Months | Under Development Contract to Open 500 Stores Within the Next 7 Years  Swiss Farms and Farm Stores Have Been Successfully Operating For 50+ Years

Swiss Farms – Swarthmore, PA 4 Financial Analysis PRICE: $1,713,957 | CAP: 6.00% | RENT: $102,837 PROPERTY DESCRIPTION RENT SCHEDULE Lease Year(s) Annual Rent Monthly Rent Rent Escalation (%) Property Swiss Farms Year 1 $102,837 $8,569.78 - Property Address 730 South Chester Road Year 2 $102,837 $8,569.78 3.00% City, State, ZIP Swarthmore, PA 19081 Year 3 $105,923 $8,826.88 3.00% Year 4 $109,100 $9,091.68 3.00% Year Built 1969 Year 5 $112,373 $9,364.44 3.00% Building Size 910 SF Year 6 $115,744 $9,645.37 3.00% Lot Size +/- 0.21 Acres Year 7 $119,217 $9,934.73 3.00% Year 8 $122,793 $10,232.77 3.00% Type of Ownership Fee Simple Year 9 $126,477 $10,539.76 3.00% THE OFFERING Year 10 $130,271 $10,855.95 3.00% Year 11 $134,180 $11,181.63 3.00% Purchase Price $1,713,957 Year 12 $138,205 $11,517.08 3.00% CAP Rate 6.00% Year 13 $142,351 $11,862.59 3.00% Annual Rent $102,837 Year 14 $146,622 $12,218.47 3.00% Year 15 $151,020 $12,585.02 3.00% LEASE SUMMARY Year 16 $155,551 $12,962.57 3.00% Property Type Net Leased Drive-Thru Convenience Store Year 17 $160,217 $13,351.45 3.00% Tenant / Guarantor Farm Stores Franchising, LLC Year 18 $165,024 $13,752.00 3.00% Year 19 $169,975 $14,164.56 3.00% Original Lease Term 20.0 Years Year 20 $175,074 $14,589.49 3.00% Rent Commencement 5/8/2020 INVESTMENT SUMMARY Lease Expiration 5/31/2040 Marcus & Millichap is pleased to present the exclusive listing for a Swiss Farms, a subsidiary of Farm Stores, located at 730 South Chester Road in Swarthmore, PA. The site consists of Lease Term Remaining 20.0 Years roughly 910 rentable square feet of building space on estimated 0.21-acre parcel of land. Lease Type Triple-Net (NNN) The Swiss Farms property is subject to a brand new 20-year triple-net (NNN) lease, which Roof & Structure Tenant Responsible commenced May of 2020. The initial annual rent is $102,837 and will increase by three Rental Increases 3% Annually Starting Year 3 percent annually starting in year three, throughout the term of the lease and in each option period. There are two, five-year tenant renewal options, extending the total possible lease Options to Renew Two, Five Year Options term to 30 years.

Swiss Farms – Swarthmore, PA 5 Tenant Overview

About Farm Stores General Information Farm Stores is the country's largest and fastest growing chain of drive thru grocery stores. Founded 1957 Catering to consumers with busy lifestyles and families always on the go, Farm Stores prides Website http://www.farmstores.com itself on being the Convenience last stop store on the way home. A hybrid grocery store, bakery and restaurant with a double drive-thru makes Farm Stores concept one-of-a-kind. In Number of Locations 70+ 1957, the company created its drive-thru stores to deliver fresh dairy products directly to the consumer. By the late 1960s, Farm Stores had become recognized as the premier convenience store for quality dairy products and groceries in Florida. Today, it is the oldest and largest drive-thru convenience store in the United States.

Farm Stores is rapidly expanding throughout the country. In addition to its locations in Florida, the company is scheduled to break ground on approximately 30-40 stores. Additionally, Farm Stores is under a development contract to open 500 stores over the next seven years.

Farm Stores developed a prefabrication building process, repurposing shipping containers for its stores, which is not only a greener construction method but also increases efficiency and reduces development time dramatically. Farm Stores purchases the land, builds the store and ships the building to the site and then sells the franchise. “We sell brand new, fully equipped stores from $50,000 to $150,000 all in,” Bared says. “Franchisees get a brand new location that’s turnkey delivered to them and it’s done at a low rent rate because of our buying power so they don’t have to focus on development and can focus on the operation of the business.”

The secret to Farm Stores’ success is catering to the neighborhoods in which they are located. “Each neighborhood dictates how the store is merchandised,” Bared says. “Eighty percent of the merchandise is common items like milk, bread and other fresh products that we know will sell in every store and state. The remaining 20 percent is localized items. Farm Stores equips its franchise locations with a cloud-based POS system. The company is also rolling out its app so customers can order from the drive-thru or at home and speed up the process. The app also allows customers to take a deeper look inside the store’s menu of products, something not so easily done from the car.

Swiss Farms – Swarthmore, PA 6 https://www.delcotimes.com/news/coronavirus/swiss-farms-delcos-drive-thru-store-sees-big-upsurge-in-customers/article_8c938c06-75cd-11ea-952b-73f2caa01a3c.html *Farm Stores Has Recently Acquired Swiss Farms In Recent News: Swiss Farms, Delco’s Drive-Thru Store, Sees Big Upsurge in Customers Swiss Farms drive-thru markets, which have been in Delaware County for more than 50 years, has seen a 45 percent rise in sales since Gov. Tom Wolf’s stay-at-home orders hit Delaware County, according to CEO and President Chris Gray.

MARPLE — For residents practicing coronavirus stay-at- “Certain items - toilet paper, eggs, basic items, paper of. home protocols, shopping for food is the time they are products - we’re sourcing from venders to try to keep in most exposed. One longtime Delaware County business stock of these high-movement items,” Gray said. “Kind of To handle the thorough cleaning and stocking of the may have been ahead of its time with a solution - drive- the trick now is when you get the stuff in, you’ve got to stores, they have adjusted hours to a 7 a.m. opening and 9 thru shopping. get there or it’s gone.” p.m. closing.

Swiss Farms drive-thru markets, which have been in Gray said customers have been really great and the The company has a Level Up phone app that allows Delaware County for more than 50 years, has seen a 45 feedback the firm gets has been getting is overwhelmingly customers to pay by holding up their phone which the percent rise in sales since Gov. Tom Wolf’s stay-at-home positive, with many crediting specific employees. sales associate scans. They also offer fresh food, heat-and- orders hit Delaware County, according to CEO and eat items, which can be delivered through Uber Eats or President Chris Gray. He said to protect employees, the company has issued GrubHub, depending on location. gloves and has looked into masks, but like many others, “Our business is going extremely well. We’re trying to be have found the availability limited. Staff is welcome to Gray is hoping to maintain some of the new business he out there for customers,” said Gray in a phone interview wear their own if they wish. has seen and believes that after the pandemic is over, Friday. “People appreciate the drive through. They don’t social distancing will continue to be a part of the culture. have to get out of the car. It’s been really good for our “Safety is paramount,” Gray said. “We have a coronavirus business. I hate to say it; it’s at a high cost.” committee meeting three times a week on how to deal While bemoaning the way it happened, Gray said the sales with customer and employee safety.” growth has helped his business. “We’re a small company. There are 11 Swiss Farmss stores, all in Delaware County, This is really a shot in the arm to assure we will be around which have dual drive-in lanes with the store clerk in the Gray said the stores have proper cash-handling the next 50 years,” he said. middle allowing for a high volume of cars to enter. They procedures, product-handling procedures, and are have between 180-190 in-store employees and carry following up every day. Some customers take the items In the past, the company has only had a small numbers of more than 1000 grocery items. through the car window; others have them placed in their stores outside Delaware County, with one in Goshen and trunks. Workers practice cleaning and sanitizing of the another in North Carolina. The residential density has Gray said there have been challenges from the stores throughout the day and employees who are not been a better guide to their business than traffic counts coronavirus pandemic affecting the supply chain, which, feeling well are told to stay home. Gray said full-time past the stores, but they have some aggressive expansion like at other stores, have led to short-term shortages of employees have sick time built into their paid time off plans in the works for later this year. items like eggs and toilet paper. That's forced the policy; part-time employees are being handled on a case- company to get creative in finding some products. by-case basis, so if someone is truly being affected by the “It’s been crazy, but we’re ready to keep doing this for as virus or worries about being sick, they will be taken care long as we have to during this pandemic,” Gray said.

Farm Stores – Lafayette, LA 7 Surrounding Area Property Address: 730 South Chester Road - Swarthmore, PA 19081

1,600 Students Enrolled

THE SPRINGHAVEN CLUB

PHILADELPHIA INTERNATIONAL AIRPORT 31.7M PASSENGERS ANNUALLY

8 Miles

Swiss Farms – Swarthmore, PA 8 Location Overview Property Address: 730 South Chester Road - Swarthmore, PA 19081

The Swiss Farms investment property is strategically situated at 730 South Chester Road in Swarthmore, Pennsylvania. South Chester Road experiences an average daily traffic count exceeding 10,900 vehicles, respectively. Intersecting with South Chester Road is Interstate-476, which brings an additional 86,000 vehicles into the immediate area on average daily. There are more than 271,800 individuals residing within a five-mile radius of the property and more than 994,650 individuals within a ten-mile radius. This Swiss Farms property is situated in an affluent suburban community with an average ADTC: 10,900 household income of over $95,230 within a three-mile radius.

The Swiss Farms property is strategically situated in a dense residential and retail corridor. Major tenants in the immediate area include: Walmart, The Home Depot, Dollar Tree, CVS Pharmacy, Wendy’s, Dunkin Donuts, TD Bank, as well as many others. The subject property benefits from its close proximity to several academic institutions. The most notable is Swarthmore College, a private liberal arts college, which has a total enrollment exceeding 1,600+ students and is located within a one-mile radius. Philadelphia International Airport (PHL), the 20th busiest airport in the United States, serves over 31,700,000 passengers annually and is located eight miles from the subject property.

Swarthmore, PA is a borough in Delaware County, PA, which is situated ADTC: 86,000 approximately 10 miles outside the bustling city of Philadelphia. Home to the storied Swarthmore College, founded in 1864, the borough offers the tranquility of tree-lined streets surrounding a town center filled with upscale shops and restaurants. Swarthmore, PA is a welcome destination for families who seek serene neighborhoods, coupled with a superior public school system. Additionally, Philadelphia, the fifth largest city in the United States, is the economic epicenter of activity for Pennsylvania and beyond, the most prominent sectors of work consisting of financial services, health care, biotechnology, information technology, trade and transportation, manufacturing, oil refining, food processing, and tourism.

Swiss Farms – Swarthmore, PA 9 Local Map Property Address: 730 South Chester Road - Swarthmore, PA 19081

Fetters Construction Airport (PA70)

Philadelphia International Airport (PHL)

New Garden Airport (N57)

Swiss Farms – Swarthmore, PA 10 Regional Map Property Address: 730 South Chester Road - Swarthmore, PA 19081

PENNSYLVANIA

Swiss Farms – Swarthmore, PA 11 Demographics Property Address: 730 South Chester Road - Swarthmore, PA 19081

3 Miles 5 Miles 10 Miles POPULATION 2025 Projection 127,307 272,309 1,002,502 2020 Estimate 127,169 271,808 994,651 2010 Census 127,298 271,010 967,491 Growth 2020 – 2025 0.11% 0.18% 0.79% 2020 Population Hispanic 10 Miles 5,582 11,044 41,484 Origin Population by Race (2020): 5 Miles White 94,864 193,081 528,870 Black 24143 61,124 375,687 American Indian & Alaskan 289 626 2,938 3 Miles Asian 4,871 10,694 63,299 Hawaiian & Pacific Island 52 127 489 Other 2,950 6,156 23,368 Household Trends: 2025 Projection 48,797 105,192 380,144 2020 Estimate 48,757 105,022 377,255 2010 Census 48,856 104,773 367,452 Growth 2020 - 2025 0.08% 0.16% 0.77% Owner Occupied 33,876 72,214 241,511 Renter Occupied 14,882 32,808 135,744 Average Household Income (2020): $95,237 $89,708 $86,609 Households by Household Income (2020): <$25,000 7,398 17,035 83,093 $25,000 - $50,000 9,296 21,975 77,877 $50,000 - $75,000 8,518 18,955 63,055 $75,000 - $100,000 6,362 13,317 42,644 $100,000 - $125,000 4,933 10,477 31,049 $125,000 - $150,000 3,886 7,419 20,651 $150,000 - $200,000 4,227 8,075 26,045 Median Household Income (2020): $72,445 $67,751 $60,032

Swiss Farms – Swarthmore, PA 12 Market Overview

Philadelphia, PA Philadelphia is the largest city in the Commonwealth of Pennsylvania and the sixth-most populous city in the United States. The city is home to more than 1.6 million residents who are part of a much bigger population system attributable to the Philadelphia-metro. Philadelphia is the economic and cultural anchor of the greater , located along the lower Delaware and Schuylkill Rivers, home to just over 7.2 million residents ranking it as the eighth-largest combined MSA in the United States.

Philadelphia is the economic epicenter of activity for Pennsylvania and beyond, the most prominent sectors of work consisting of financial services, health care, biotechnology, information technology, trade and transportation, manufacturing, oil refining, food processing, and tourism. Financial services account for the largest economic driver of the metropolitan area, also providing one of the largest health education and research centers to the United States’ health sector. The City is home to the Philadelphia Stock Exchange and headquarters of the cable television and internet provider, . Other large corporations such as companies Cigna, Colonial Penn, Independence Blue Cross are among a few of the conglomerate insurance companies home to Philadelphia. Other notable employers based out of Philadelphia is the pharmaceutical company GlaxoSmithKline, apparel retailer , automotive parts retailer , and food services company .

Philadelphia is home to five major publicly traded companies, headquartered out of Philadelphia, generating an aggregate total of over $117.5 in annual revenue. With a gross domestic product of $388 billion, the city of Philadelphia alone ranks ninth among world cities and fourth in the nation. The city is also the nation's fourth-largest consumer media market, as ranked by the Nielsen Media Research. The city is also home to the Philadelphia Stock Exchange. Philadelphia has shifted to an information technology and service-based economy. Financial activities account for the largest sector of the metro economy, and it is one of the largest health education and research centers in the United States. Philadelphia's history attracts many tourists, with the Liberty Bell receiving over 2 million visitors.

Swiss Farms – Swarthmore, PA 13 EXCLUSIVE NET LEASE OFFERING

Sean Beuche Marcus & Millichap 2005 Market St Ste 1510 Philadelphia, PA 19103 Tel: 215-531-7050 Fax: 215-531-7010 License: RM424190 Marcus & Millichap Real Estate Investment Services of Seattle, Inc. 215-531-7000 License #: RB062197C