OFFERING MEMORANDUM

ABSOLUTE NNN | $4,687,500 6 AND CENTERSTONE INN 16102 THEME PARK WAY DOSWELL, VA Motel 6 and Centerstone Inn

CONTENTS 01 Executive Summary Executive Summary 5 Location Summary 6 02 Property Description Parcel Map 7 Property Images 9

03 Demographics

Demographics 11 Demographic Charts 12

Steven Davis Managing Member 480-429-4580 [email protected] Lic: 101032000 8255 East Raintree Drive Suite 100 Scottsdale, AZ 85260

We obtained the following information above from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions, change of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions or estimates for example only, and they may not represent the current or future performance of the property. You and your tax and legal advisors should conduct your own investigation of the property and transaction. Motel 6 and Centerstone Inn Confidentiality and Disclaimer | 03

CONFIDENTIALITY AND DISCLAIMER:

The information contained in the following offering memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Retail Investment Group and it should not be made available to any other person or entity without the written consent of Retail Investment Group.

By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property, please promptly return this offering memorandum to Retail Investment Group. This offering memorandum has been prepared to provide summary, unverified financial and physical information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Retail Investment Group has not made any investigation, and makes no warranty or representation with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence of absence of contaminating substances, PCBs or asbestos, the compliance with local, state and federal regulations, the physical condition of the improvements thereon, or financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this offering memorandum has been obtained from sources we believe reliable; however, Retail Investment Group has not verified, and will not verify, any of the information contained herein, nor has Retail Investment Group conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property.

PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT RETAIL INVESTMENT GROUP FOR MORE DETAILS. MOTEL 6 AND CENTERSTONE INN CENTERSTONE AND 6 MOTEL

Executive Summary Offering Summary Location Summary ...... 01

Motel 6 and Centerstone Inn | Executive Summary Motel 6 and Centerstone Inn Executive Summary | 05

OFFERING SUMMARY New 20 Year Absolute NNN Lease Commences at COE ADDRESS 16102 Theme Park Way Doswell, VA 7.5% Increases Every 5 Years COUNTY Hanover 4 x 5 Year Options LEASE TYPE Absolute NNN Located Next to King's Dominion, a large theme park CAP RATE 8.00% with 13+ million visitors per year BUILDING SQUARE FEET ±80,000 Located ±2.5 Miles from the State Fair of Virginia LAND SQUARE FEET ±457,380 TOTAL ROOMS 231 High Traffic Location with 107,000+ Vehicles Per Day at I-95 Interchange YEAR BUILT 1975 YEAR RENOVATED 2016 Tenant shall have the right to buy back the real estate after the lease has operated minimum of five years TENANT Very Fine , Inc. by paying $700,000 premium on the original capitalized amount. OWNERSHIP TYPE Fee Simple Retail Investment Group is pleased to present Motel 6 and PARCEL NUMBER 7883-62-1482 Centerstone Inn located in Doswell, Virginia. This property is ZONING TYPE B3 ±80,000 square feet on ±10.50 acres of land. This location was built in 1975 and was renovated in 2016. It has 231 keys total, an outdoor pool, an arcade, a playground, and tennis courts. FINANCIAL SUMMARY About Motel 6: OFFERING PRICE $4,687,500 The promise of the lowest price of any national chain and a clean, PRICE PER KEY $20,292 comfortable room are Motel 6 virtues. Motel 6 is a household PRICE PSF $ .5 name, synonymous with quality and value. It enjoys the highest 58 9 brand recognition factor of any economy lodging brand. OCCUPANCY 100% The brand continues to grow and currently has approximately NOI (CURRENT) $375,000 1,200 locations with more than 105,000 rooms in the United CAP RATE (CURRENT) 8.00% States and Canada. Part of G6 Hospitality, Motel 6 is the largest owned and operated chain in North America.

DEMOGRAPHICS 1 MILE 3 MILE 5 MILE About Centerstone Inn: 2017 Population 98 1,046 4,658 Centerstone Inn is a nationally franchised hotel company offering both Centerstone Inns, , and Plaza Hotels as well as Key 2017 Median HH Income $58,641 $69,550 $66,844 West Inns, Hotels, and Resorts. Each hotel is individually owned 2017 Average HH Income $72,424 $81,215 $83,611 and operated under a franchise agreement with the company Vimana Franchise Systems, LLC. Each property has on-site ownership and management to ensure your stay us the very best it can be. Motel 6 and Centerstone Inn Location Summary | 06 Regional Map

Doswell, Virginia is located in Eastern Virginia. It is ±85 miles South of , DC and ±24 miles from Richmond, Virginia. Located in Hanover County Virginia, Doswell is home to a vast history and thriving businesses. Hanover County works hard to aid both new and existing businesses in their success. The county has created an economic development plan to increase the county's tax base and enable the creation of new jobs. This property is located directly across from King's Dominion. King's Dominion is a 400-acre theme park that has been open for nearly 43 years. The theme park sees an average of 13 million people per year. The location provides ideal accommodations for those visiting the park by being within walking distance of the King's Dominion's entrance. Supporting retailers include Subway, Chick-fil-a, Panda Express, Starbucks, 7 Eleven, Burger King, Cinnabon, and Auntie Annes. Surrounding hotels include Day's Inn, La Quinta Inn and Suites, and Locator Map Country Inn and Suites. This property is located only ±30 miles from Richmond International Airport. The property is also located ±2.5 miles from State Fair of Virginia which is held every year in October- September with 250,000+ people in attendance in 2017. The fairgrounds also host numerous events throughout the year bringing in thousands of attendees. Motel 6 and Centerstone Inn are located at the interchange of Route 30, with 11,000+ vehicles per day, and I-95, with 96,000+ vehicles per day. Motel 6 and Centerstone Inn Parcel Map | 07 Motel 6 and Centerstone Inn Property Images | 08 Motel 6 and Centerstone Inn Property Images | 09 Motel 6 and Centerstone Inn Property Images | 10 MOTEL 6 AND CENTERSTONE INN CENTERSTONE AND 6 MOTEL

Demographics Demographic Details Demographic Charts ...... 03

Motel 6 and Centerstone Inn | Demographics Motel 6 and Centerstone Inn Demographics | 11

POPULATION 1 MILE 3 MILE 5 MILE HOUSEHOLDS 1 MILE 3 MILE 5 MILE 2000 Population 99 957 3,703 2000 Total Housing 47 386 1,433 2010 Population 96 1,022 4,375 2010 Total Households 43 396 1,653 2017 Population 98 1,046 4,658 2017 Total Households 44 406 1,763 2022 Population 100 1,084 4,966 2022 Total Households 45 422 1,881 2017 African American 19 216 1,301 2017 Average Household Size 2.23 2.57 2.61 2017 American Indian 1 7 24 2000 Owner Occupied Housing 30 279 1,089 2017 Asian 0 4 36 2000 Renter Occupied Housing 13 84 251 2017 Hispanic 4 31 120 2017 Owner Occupied Housing 28 301 1,383 2017 White 73 781 3,154 2017 Renter Occupied Housing 16 106 380 2017 Other Race 2 17 47 2017 Vacant Housing 5 38 183 2017 Multiracial 2 21 95 2017 Total Housing 49 444 1,946 2017-2022: Population: Growth Rate 2.00 % 3.60 % 6.45 % 2022 Owner Occupied Housing 29 312 1,473 2022 Renter Occupied Housing 16 110 408 2017 HOUSEHOLD INCOME 1 MILE 3 MILE 5 MILE 2022 Vacant Housing 6 39 195 less than $15,000 4 28 142 2022 Total Housing 51 461 2,076 $15,000-$24,999 4 28 128 2017-2022: Households: Growth Rate 2.25 % 3.90 % 6.50 % $25,000-$34,999 4 37 183 $35,000-$49,999 6 48 197 $50,000-$74,999 9 74 310 $75,000-$99,999 7 66 287 $100,000-$149,999 7 88 330 $150,000-$199,999 2 20 80 $200,000 or greater 1 17 107 Median HH Income $58,641 $69,550 $66,844 Average HH Income $72,424 $81,215 $83,611

Source: esri Motel 6 and Centerstone Inn Demographic Charts | 12

2017 Household Income

1 Mile Radius 3 Mile Radius 5 Mile Radius

2017 Population by Race

1 Mile Radius 3 Mile Radius 5 Mile Radius RETAIL INVESTMENT GROUP LLC Net Leased Investment Brokerage 8255 East Raintree Drive #100 480-429-4580 Scottsdale AZ 85260 fax 480-452-1820

This business is owned under Very Fine Motels, Inc, owned Mrs. Jayshree K Shah and Mr. Kirtikumar J Shah (KJ) where wife owns 51% and husband owns 49%. The Shahs were married in 1984 in New York and purchased their first 15 room Mom & Pop Motel off I-95 at exit 118 (Thornburg, Virginia), in 1986 where they lived with their newly born son. This motel provided basis for many motel and retail ventures that the Shah family did until 2005 when the same was sold. In 1991 the Shahs got into a 30-room property in Emporia Virginia, in 1989 a gas station where a convenience store was put in place of a car repair shop, the family could not fix cars, but could help travelers with their snacking needs besides selling them gas, motor oil and such. This venture helped the Shah family settle another brother in a country store and send a sister through the Med Tech course in MCV Richmond. In 1994, a 99-room ex-Howard Johnson business under a 46 years lease was purchased. This business was operated until 1998. During this period a C-store was purchased in Chattanooga, TN was renovated and sold as the family moved back to Virginia. In 2005, the first motel that the Shah family had since 1986 was sold at a tidy profit. To reinvest the cash, they found a deal with 64 rooms, a restaurant and bar (leased), huge meeting hall with best location between Walmart and the City Hospital in North Platte Nebraska. This purchase was financed by the sellers with a wraparound mortgage from their bank. The deal closed on 7/21/2008. On 8/05/2008, another 79-room motel property in same town was taken over under a purchase contract. It needed boost from a brand, so it was converted into . A month later the Great Recession hit the country and it was very difficult for most people to pay mortgages regularly, but the Shah family did manage to do so. In 2010 they were requested to help someone who had property come out of litigation but had no time for it. This property was in Denver, Colorado. They helped the owners for about 16 months and its cash flow helped them have everything paid on time. In 2011, the Shahs were offered cash for the property purchased on 7/21/2008 which they accepted. These buyers came into almost a million dollar of cash and happily loaned the Shahs money for their next venture which was in Phoenix, Arizona. This property had 126 rooms on I-10 exit in the city. This property was purchased by a group but needed to flip it because they found it was too much work to turn around. This

www.retail1031.com husband and wife team purchased it for $1,500,000 and flagged it as spending about $700,000 in its complete renovation. When wife and son-- now a Computer Engineer -- could not move to Phoenix Az, they sold the newly renovated property for $2,600,000 dollars. The husband moved back to Virginia and purchased the 248-room property which carried flag for total contract cost of $4,050,000 on 4/24/2014 with SBA financing of $2,800,000 dollars. It had a lot of deferred maintenance and they have so far spent over $1,500,000 for renovation, holding costs, conversion etc. It was found that with changed market conditions, no single brand could make the motel profitable, as such, on 11/01/2016 Best Western Flag was replaced by Motel 6 for two buildings with 104 licensed rooms facing an exit ramp. The building facing the Amusement Park was converted to Centerstone Inn. This step brought down our royalty’s payment to about $100,000 from $250,000 a year. We could exit from payments for uneconomic brand mandates, about $300,000 a year, besides contractual payments to the park next door for so called priority listing of the property in their web site etc., saving almost another $100,000 dollars. In short, the name change made us profitable despite a small fall in the gross room revenue. Presently we have license for 127 rooms under Centerstone Inn and 104 rooms under Motel 6. Building Size about 80,000 square feet on 10.5 acres. This property was constructed in 1975-76 and the original builder-owners owned it till 2014 when it was sold to us. The property has very good bones and is in a lucky spot being it has exit 98 ramps on one side and Kings Dominion Amusement Park entrance doors on the other side. Customers are able to walk to the park and come to their motel room during their visit to the park, a very useful feature for families with young children. Please note that once this deal happens it will remove the constraints on our operations caused by excessive outgoings on debt service. We were constrained to resort to Hard Money Short term loans because we anticipated a sale of this property and we needed to tide over the slow winter business months. With new funds, we plan to get our restaurant re-themed and open with another tenant with participating lease income which will be a win-win situation. Also, we may go for a Taller High Sign that will overcome visibility problems caused by trees that are on Federal Interstate next to us. We may be able to expedite completion of new brand's PIP that is presently spread over longer period till 2019. This will boost our income.

www.retail1031.com Steven Davis Managing Member 480-429-4580 [email protected] Lic: 101032000 8255 East Raintree Drive Suite 100 Scottsdale, AZ 85260