TACO BELL & KFC ™ 1621 S MAIN ST | GROVE, OK Property Name

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OFFERING MEMORANDUM TACO BELL & KFC ™ 1621 S MAIN ST | GROVE, OK Property Name

Taco Bell & KFC

List Price

$1,559,000

Cap Rate

6.12%

Square Footage

± 3,113 SF

Year Built

1996

Term Remaining

±6.5 Years

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LISTED BY

TYLER GROTH CALVIN SHORT BROKER OF RECORD Associate — STNL SVP & Senior Director Jessica Dearnley [email protected] [email protected] LIC # 170787 (OK) DIR 310.844.9370 DIR 949.432.4506 MOB 269.326.2493 MOB 310.567.3525 LIC # 6501390929 (MI) LIC # 01927216 (CA) EXECUTIVE OVERVIEW

INVESTMENT HIGHLIGHTS TENANT DETAILS: • Strong Store Performance - Tenant reports store sales well above the national average and continues to increase year-over-year

• Large Operator - KMAC is one of the largest and most respected Taco Bell/KFC operators in the country with more than than 300 Taco Bell/KFC locations and annual revenues exceeding $400M

• Excellent Rent to Sales Ratio - KMAC is performing at a low 5% rent-to-sales ratio providing added security

• E-Commerce Proof Concept - Taco Bell/KFC is resistant to the “Amazon Effect” and continues to experience strong same store sales growth across the brand

PROPERTY DETAILS: • Limited Competition - Property is the only Taco Bell or KFC within a 25mi radius

• Absolute NNN Lease - This absolute NNN lease provides passive income with zero landlord responsibilities

• Inflation Hedge - Annual increases in the base term and option periods creates an excellent hedge against future inflation LOCATION DETAILS: • Strategic Location - Property is located adjacent to the only Walmart within a 10mi radius of the Property

• Growing Market - Population growth within a 5mi radius has increased more than 30% since 2000

• Economic Development - The entrance to the $56 million Integris Grove Hospital, opened in 2010, is less than 500 feet from the Property

3 FINANCIAL OVERVIEW

FINANCIAL HIGHLIGHTS

EXECUTIVE SUMMARY LIST PRICE TERM REMAINING CAP RATE Property Name Taco Bell $1,559,000 6.12% ±6.5 YEARS Property Street 1621 S Main St City, State, Zip Grove, OK 74344 Gross Leasable Area ± 3,113 SF Year Built 1996 ANNUALIZED OPERATING DATA Lot Size ±53,579 SF

Monthly Rent Annual Rent Cap Rate TENANT SUMMARY Current 2018 $7,952.43 $95,429.12 6.12% Tenant Trade Name Taco Bell & KFC Year 15 2019 $8,031.95 $96,383.41 6.18% Type of Ownership Fee Simple Year 16 2020 $8,112.27 $97,347.25 6.24% Lease Type NNN Year 17 2021 $8,193.39 $98,320.72 6.31% Roof & Structure Tenant Responsibility Year 18 2022 $8,275.33 $99,303.93 6.37% Rent Commencement Date 12/28/2004 Year 19 2023 $8,358.08 $100,296.97 6.43% Lease Expiration Date 12/31/2024 Year 20 2024 $8,441.66 $101,299.94 6.50% Increases 1% Annually Option 1 2025 $8,526.08 $102,312.93 6.56% Extensions Four, 5-Year Options Option 2 2030 $8,960.99 $107,531.92 6.90% Option 3 2035 $9,418.09 $113,017.13 7.25% Option 4 2040 $9,898.51 $118,782.14 7.62%

4 Representative Photo TENANT OVERVIEW

TACO BELL PARENT COMPANY TRADE NAME YUM! BRANDS, INC. (NYSE: YUM) Operating as a subsidiary of Yum! Brands, Inc., Taco Bell Corp. owns operates, and franchises a chain of Mexican-inspired CREDIT RATING (S&P) quick service restaurants in the United States. The company’s restaurants offer made to order and customizable tacos, BBB burritos, quesadillas, gorditas, nachos, chalupas, beverages, desserts and sides, and other specialty items. As the leading # OF LOCATIONS Mexican-inspired quick service restaurant brand, Taco Bell and its more than 350 franchise organizations proudly serve ± 6,500 over 42 million customers each week through nearly 7,000 restaurants across the nation, as well as through its mobile, desktop and delivery ordering services. Overseas, Taco # OF EMPLOYEES Bell has over 250 restaurants, with plans to add 2,000 more ± 175,000 restaurants internationally within the next decade. In 2016, Taco Bell was named as one of Fast Company’s Top 10 Most Innovative Companies in the World. Taco Bell plans to have HEADQUARTERED 8,000 restaurants by the year 2023, which is anticipated to add IRVINE, CALIFORNIA an estimated 100,000 jobs nationwide.

WEBSITE WWW.TACOBELL.COM

YEAR FOUNDED 1954

5 KFC

KFC Corporation, based in Louisville, Kentucky, is one of the few brands in America that can boast a rich, decades-long history of success and innovation. It all started with one cook who created a soon-to-be world-famous recipe more than 70 PARENT COMPANY TRADE NAME years ago, a list of secret herbs and spices scratched out on the YUM! BRANDS, INC. (NYSE: YUM) back of the door to his kitchen. That cook was Colonel Harland Sanders, of course, and now KFC is the world’s most popular chicken restaurant chain, specializing in that same Original CREDIT RATING (S&P) Recipe® along with Extra Crispy™ chicken, home-style sides and BBB buttermilk biscuits. There are more than 20,000 KFC outlets in 125 countries and territories around the world. # OF LOCATIONS ± 42,000 YUM! BRANDS YUM! Brands is the largest fast-food operator in the world in terms of number of locations, with more than 41,000 outlets in # OF EMPLOYEES about 125 countries. The company’s flagship chains include #1 ± 505,000 chicken fryer KFC (with more than 19,400 units), top pizza joint Pizza Hut (more than 15,600), and quick-service Mexican leader Taco Bell (more than 6,200). YUM! sold the Long John Silver’s HEADQUARTERED seafood chain, along with several hundred A&W root beer and LOUISVILLE, KY burger stands to two separate buyers in late 2011. In 2015 YUM! Brands announced it would spin off its Chinese operations into a separately traded public company. WEBSITE WWW.KFC.COM

YEAR FOUNDED 1997

6 PARCEL MAP S MAIN STREET ±15,000 ADT S MAIN STREET

7 TENANT MAP

S Main St ±15,000 ADT INTEGRIS Grove Hospital

Grove Civic Center

8 AREA OVERVIEW DEMOGRAPHICS POPULATION 1 Mile 3 Mile 5 Mile GROVE, OK 2022 Projection 2,920 8,552 12,324 2017 Estimate 2,949 8,605 12,328 Sitting on Grand Lake of the Cherokees right outside of Tulsa, Grove is a beautiful destination for vacationers. It is the largest community on the Grand Lake. The city boasts world-class 2010 Census 2,804 8,192 11,782 fishing and water sports of all types. The city is home to a few casinos and many events for Growth 2010-2017 5.16% 5.05% 4.64% residents and visitors to attend. HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 1,338 3,924 5,716 With median home values well above the state average, Grove boasts a healthy economy. With over 1,000 local businesses, Grove has a ratio of 15.5 businesses per 100 residents. 2017 Estimate 1,348 3,931 5,692 Recent job growth in Grove is almost double the national average, with future job growth 2010 Census 1,237 3,606 5,246 expected to be 41.26% over the next 10 years. Growth 2010-2017 8.98% 8.99% 8.50%

Grove is home to 3 universities: Northeastern Oklahoma A&M College, Northeast INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Technology Center-Pryor, and Northeast Technology Center-Afton. These colleges have an $57,390 $66,794 $68,459 enrollment of over 1,000 students each year combined. Household Income

9 TULSA, OK

Tulsa – “Oil Capital of the World,” is located in northeast Oklahoma and is the principal municipality of the Tulsa Metropolitan Area, a region with 981,005 residents in the MSA and 1,151,172 in the CSA. The city serves as the county seat of Tulsa County, the most densely populated county in Oklahoma. Diversification efforts created an economic base in the energy, finance, aviation, telecommunications and technology sectors. Two institutions of higher education within the city have sports teams at the NCAA Division I level, Oral Roberts University and the University of Tulsa.

It is situated on the Arkansas River at the foothills of the Ozark Mountains in northeast Oklahoma, a region of the state known as “Green Country”. Considered the cultural and arts center of Oklahoma. Tulsa houses two world-renowned art museums, full-time professional opera and ballet companies, and one of the nation’s largest concentrations of art deco architecture. The city has been called one of America’s most livable large cities by Partners for Livable Communities, Forbes, and Relocate America. 10 ECONOMY

Tulsa remains one of the global leaders in oil and natural gas exploration/production. As the second largest metropolitan area in Oklahoma and a hub for the growing Many energy companies find themselves in Tulsa because of the success of the oil Northeastern Oklahoma-Northwest Arkansas-Southwestern Missouri corridor, the and gas sector workforce in the area. More than 20,000 workers in E&P work for city is also home to a number of the region’s most sophisticated law, accounting, and hundreds of companies large and small in the Tulsa area. Not only does Tulsa have a medical practices. Its location in the center of the nation also makes it a hub for logistics large industry in oil, energy and natural gas, but it is also a vastly diverse region when businesses; the Tulsa International Airport (TUL) and the Tulsa Port of Catoosa, connect it comes to the different segments of the industry. Companies in Tulsa vary from E&P the region with international trade and transportation. to utility, pipeline, energy services, energy supply, and alternative energy. This diverse environment makes Tulsa home to traditional and renewable energy and increases the Though the oil industry has historically dominated Tulsa’s economy, efforts in economic development of the industry in the region. diversification have created a base in the sectors of aerospace, finance, technology, telecommunications, high tech, and manufacturing. A number of substantial financial Tulsa’s aerospace industry is substantial and growing. An American Airlines corporations are headquartered in Tulsa, the largest being the BOK Financial maintenance base at Tulsa International Airport is the city’s largest employer and the Corporation. Among these financial services, firms are energy trading operations, asset largest maintenance facility in the world, serving as the airline’s global maintenance and management firms, investment funds, and a range of commercial banks. The national engineering headquarters, while the Tulsa Port of Catoosa and the Tulsa International convenience store chain QuikTrip, fast-casual restaurant chain Camille’s Sidewalk Cafe, Airport house extensive transit-focused industrial parks. Tulsa is also home to a division and pizza chain Mazzio’s are all headquartered in Tulsa, as is Southern regional BBQ of Lufthansa, the headquarters of Omni Air International, and the Spartan School of restaurant Rib Crib. Tulsa is also home to the Marshall Brewing Company. Aeronautics.

11 CONFIDENTIALITY & DISCLAIMER STATEMENT This Offering Memorandum contains select information pertaining to the business and affairs of Taco Bell located at 1621 s Main St Grove, OK 74344(“Property”). It has been prepared by Matthews Real Estate Investment Services. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews Real Estate Investment Services. The material is based in part upon information supplied by the Seller and in part upon financial information obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty, express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence.

By acknowledging your receipt of this Offering Memorandum for the Property, you agree:

1. The Offering Memorandum and its contents are confidential;

2. You will hold it and treat it in the strictest of confidence; and

3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Seller.

Owner and Matthews Real Estate Investment Services expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered.

If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum.

A prospective purchaser’s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or Matthews Real Estate Investment Services or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property.

This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum. TACO BELL & KFC ™ 1621 S MAIN ST | GROVE, OK EXCLUSIVELY LISTED BY

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