INVESTMENT OFFERING Retail Center

69 Paia, Maui, Hawaii

KOKUAINVESTMENTS.COM TABLE OF CONTENTS PRESENTED BY The Fursse Team Marketing & Selling Investment Properties Globally

1 Executive Summary Offering Summary Property Data KEONI FURSSE, CCIM Financial & Debt Summary REALTOR® Principal Broker CEO Investment Highlights HI Lic. RB-16700 Tenancy 808.280.6556 Key Demographics [email protected] Aerial Map

2 Property & Area Overview JON MCKEOWN Property Overview FINANCIAL ANALYST Site Plan & Parcel Map 808.877.9000 Area Overview [email protected] Demographics Aerial Map

3 Financial Overview Rent Roll Income And Expenses Tenant Profiles

FURSSETEAM KOKUAINVESTMENTS.COM 1 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. EXECUTIVE SUMMARY

FURSSETEAM KOKUAINVESTMENTS.COM 2 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. OFFERING SUMMARY Kokua Realty, LLC is pleased to offer for sale 69 Hana Highway, a 2,154 square foot multi-tenant retail investment opportunity located in the retail heart of Paia, Maui, Hawaii. This fee simple property features a dynamic tenant mix, and an irreplaceable location in a vibrant, tourist oriented shopping community. Recently renovated in 2005, the property’s tenant mix includes Wings Hawaii Design, a local boutique and an events coordinator. 69 Hana Highway is prominently located in the trade area’s primary retail corridor, and walking distance from popular beaches and restaurants.

PROPERTY DATA Address 69 Hana Highway, Paia, Maui, Hawaii 96779 Parcel # (2) 2-6-002-006-0000 Offering Price $2,800,000 NOI $164,790 Cap Rate 5.9% Occupancy 100% Total GLA 2,154 sq. ft. per County (1,894 SF net rentable area) Total Land SF 2,942 sq. ft. Year Built 1931 / Renovated 2005 Ownership Fee Simple FINANCIAL SUMMARY

PRICING SUMMARY Purchase Price $2,800,000 Cap Rate 5.9% Purchase Price ($/SF) $1,300 OPERATING CASH FLOW

INCOME Rental Income $168,314 Other Income (Parking) $6,000 Expense Reimbursements $9,471 Hawaii General Excise Tax (4.166%) $7,656 Effective Gross Income $191,441

EXPENSES Real Estate Taxes $9,637 Property Insurance $2,391 Landscaping $1,800 Maintenance & Repairs $2,400 Property Management $0 Utilities - Electric $1,900 Utilities - Water $865 Operating Expenses $18,993 Hawaii General Excise Tax (4.0%) $7,658 Total Expenses $26,651 Net Operating Income $164,790

FURSSETEAM KOKUAINVESTMENTS.COM 3 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. INVESTMENT HIGHLIGHTS

STRONG INVESTMENT FUNDAMENTALS • Retail building located at the gateway to Paia’s retail corridor. • Long term leases available for all tenants. • Prime retail rent of $8.91 PSF/Month, NNN for anchor tenant. • Stable “in-place” income with strong rental growth potential. • Recent renovation (2005). • Prime location – Prominently locate in the trade area’s primary thoroughfare and walking distance to other local retailers and restaurants. • Upside potential to convert all leases to Triple Net (NNN) leases to allow full expense pass through and offer favorable rent increases.

PRIME LOCATION IN ESTABLISHED TRADE AREA • Located on Hana Highway in the internationally recognized surf town of Paia, Maui, Hawaii – a busy road into the Northshore of the island on the way to Hana. • Strong demographics – more than 3,405 people living within 3 miles of the site, and an average household income of more than $103,708. • Prominently located on the trade area’s primary thoroughfare and minutes away from and Kahului Harbor.

LOW MANAGEMENT HASSLE • Easy to manage two-tenant property. • Convert all leases to allow full pass through of all property related expense. • Recent 2005 renovation.

TROPHY PROPERTY & IDEAL 1031 REPLACEMENT • Hawaiian architecture and design create a stand out property. • Offered free and clear of existing debt – financing available at historically low rates. • Available for quick close to accommodate 1031 exchange timelines.

FURSSETEAM KOKUAINVESTMENTS.COM 4 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. TENANCY The subject is currently occupied by two tenants. The building is demised into three distinct spaces: a main retail space that is accessed by Hana Highway, a studio/one bedroom dwelling unit with one 69 Hana Highway full bathroom and a full kitchen, and a storage space. The main retail space (Space 1) is leased to Paia, Maui, Hawaii Wings Hawaii Design, a boutique that sells clothing and gifts. Units 2&3, along with the property’s two parking spaces are leased to the owner of the subject property.

KEY DEMOGRAPHIC INFORMATION

POPULATION 1-MILE 3-MILE 5-MILE 2021 Projection 2,492 3,661 10,338 HAWAII 2016 Estimate 2,310 3,405 9,717 2010 Census 2,117 3,136 9,105 Growth 2016-2021 7.88 % 7.52% 6.39% Growth 2010-2016 9.12% 8.58% 6.72%

69 Hana Highway Paia, Maui, Hawaii INCOME 1-MILE 3-MILE 5-MILE 2016 Est. Average $96,348 $103,708 $94,317 Household Income

HOUSEHOLDS 1-MILE 3-MILE 5-MILE 2021 Projection 906 1,292 3,683 2016 Estimate 839 1,202 3,455 2010 Census 769 1,108 3,323 Growth 2016-2021 7.9 9 % 7.49% 6.60% MAUI Growth 2010-2016 9.10 % 8.48% 6.90%

FURSSETEAM KOKUAINVESTMENTS.COM 5 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. 9.3-Acre Mixed-Use Development (Retail, Office & Residential)

69 Hana Highway Paia, Maui, Hawaii

339-Acre Development (Sold December 2016 for $9.99 Million or $29,453 per acre)

FURSSETEAM KOKUAINVESTMENTS.COM 6 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. PROPERTY & AREA OVERVIEW

FURSSETEAM KOKUAINVESTMENTS.COM 7 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. PROPERTY OVERVIEW

69 HANA HIGHWAY Address: 69 Hana Highway, Paia, Maui, Hawaii 96779 Assessor’s Parcel Number: (2) 2-6-002-006-0000 Number of Buildings: 1 Land Size: 0.07 Acres (2,942 SF) Building Size 2,154 SF Occupancy: 100% Year Constructed: 1931 / 2005 Parking: 2 surface parking spaces Traffic Counts: 18,799 VPD

FURSSETEAM KOKUAINVESTMENTS.COM 8 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. FURSSETEAM KOKUAINVESTMENTS.COM 9 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. FURSSETEAM KOKUAINVESTMENTS.COM 10 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. AREA OVERVIEW MAUI COUNTY RETAIL RENTS IN PAIA Maui County is the third most populous of the four counties of Hawaii, with a total resident population of 154,834 (2010 Census); a change of 20.1% from 2000 and 52.2% since 1990. Due to a variety of geographical features, Maui was selected “Best Island in the World” the last twenty out of twenty- two years by readers of Conde Nast Traveler magazine. Resort accommodations on Maui have consistently ranked above other Hawaii resort destinations and include The Wailea Beach Villas, Andaz Maui at Wailea Resort, Four Seasons Resort Maui at Wailea, The Fairmont Kea Lani, Ritz-Carlton, Grand Wailea, Westin Maui, Hyatt Regency and many others. Maui welcomes approximately 2,100,000 visitors per year.

Recently completed or currently developing commercial projects include: 141,241 SF New Target store in Kahului 275,000 SF Puunene Shopping Center, Kahului (when completed) 103,249 SF Maui Lani Shopping Center & Safeway, Wailuku 148,000 SF The Outlets of Maui, Lahaina

PAIA TOWN The property is located in the country town of Paia on the north shore of Maui. Maui is comprised of two major landmasses joined by an isthmus. East Maui was created by a volcano known as Haleakala, while West Maui is a group of mountains known collectively as the West Maui Mountains. The upper elevations of Haleakala are known as the “upcountry” region, and its major destinations RETAIL VACANCY IN PAIA and population centers are located directly upslope of Paia.

Historically, Paia served as the site of the plantation camps of workers at the Paia Sugar Mill. The Sugar Mill opened in 1880 and was Maui’s oldest operating plantation until its closure in 2000. The population of Paia at the peak of the sugar industry was more than 10,000 people, comprising over one-fifth of Maui’s entire population. In 1978, the perfect windsurf conditions at Ho’okipa Beach Park just north of paia were discovered. Paia began to develop its reputation for being the “Windsurfing Captial of the World”. In the ‘80’s and ‘90’s Paia saw an influx of windsurf enthusiasts from around the world searching for the windsurf mecca. Today, during the winter months, several professional wind and kite-surfing competitions take place which attract thousands of visitors.

Paia’s old plantation town character is preserved in the architecture of many of its buildings, including the subject, making this a popular tourist destination. The town provides a wide variety of unique retail boutiques and dining establishments, art galleries, a few small independently owned hotels, and other vital commercial and cultural amenities. Residential uses are found along the periphery of the core commercial area. As well as being a destination in itself, Paia is the last major stop along the Road to Hana (Hana Highway) on the far Eastern Coast of the island. Paia is also located along the route to the upcountry destinations of Makawao and Kula, and the summit of Haleakala. The southern portion of the main commercial area (where the subject is located) fronts to a white sandy beach.

FURSSETEAM KOKUAINVESTMENTS.COM 11 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. DEMOGRAPHICS SUMMARY

DEMOGRAPHICS Population growth for Hawaii has historically outpaced that of the national average, except in 2007. Growth will continue to be influenced by the employment opportunities linked to the tourism sector and the limited space available on the Hawaii Islands.

The following highlights the key statistics for population growth in Hawaii:

• Hawaii’s annual population growth averaged 1.0 percent between 2005 and 2015, compared to the 0.8 percent average rate of growth for the nation. • The region’s population is forecasted to grow an average of 0.9 percent annually, slightly higher than the nation’s projected rate of 0.8 percent from 2016 to 2020. • The state is the 13th most densely populated in the U.S.

The population growth for Honolulu County is project to slow even more during the next five years to an average annual rate of 0.6 percent. Of all the counties in Hawaii, Maui County is the only county projected to have a higher annual growth rate in the next five years than the county recorded from 2005 to 2015.

Household formation trends in Hawaii closely followed population growth trends. While household formation trends appear to mirror overall population gains, household growth is expected to rise above population growth levels over the next five-year period. The most recent recession had little to no effect on household formation. Rather, household formation increased from 0.5 percent in 2007 to 1.3 percent in 2008, a 160.0 percent increase.

Further considerations are as follows:

• Annual household growth in Hawaii between 2005 and 2015 averaged 1.1 percent, higher than the nation’s ten-year average growth rate of 0.9 percent. • The projected five-year, from 2016 to 2020, average household growth rate for Hawaii is forecasted at 1.3 percent, slightly above the national average growth rate of 1.2 percent.

FURSSETEAM KOKUAINVESTMENTS.COM 12 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. 9.3-Acre Mixed-Use Development (Retail, Office & Residential)

339-Acre Development (Sold December 2016 for $9.99 Million or $29,453 per acre)

Main Intersection of Hana Highway & Baldwin Avenue

69 Hana Highway Paia, Maui, Hawaii

FURSSETEAM KOKUAINVESTMENTS.COM 13 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. Kaahumanu Shopping Center Maui Mall

69 Hana Highway Paia, Maui, Hawaii Kahului Airport

Puunene Shopping Center and Target

FURSSETEAM KOKUAINVESTMENTS.COM 14 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. FINANCIAL OVERVIEW

FURSSETEAM KOKUAINVESTMENTS.COM 15 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. RENT ROLL

69 HANA HIGHWAY Unit Tenant Lease Start Lease End SF % of GLA Contract Rental Rate Rent Per Sq. Ft. Rent Increases Lease Type Options

Year Month Year Month 1 Wings Hawaii Design 09/05/13 09/30/18 711 37.5% $76,033.44 $6,336.12 $106.94 $8.91 10/01/17 $78,314.40 NNN None 2 Paia Inn, LLC 11/01/13 11/01/16 585 30.9% $60.000.00 $5,000.00 $102.56 $8.55 None - MTM Gross None 3 Baskin Design, LLC 01/01/16 03/31/21 598 31.6% $30,000.00 $2,500.00 $50.17 $4.18 None Gross None

Occupied Totals - In Place 1,894 100.0% $166,033.44 $13,836.12 $87.66 $7.31

Vacant Totals 0 0.0% $0.00 $0.00 $0.00 $0.00

Total 1,894 100.0% $166,033.44 $13,836.12 $87.66 $7.31

Notes: 1. Units 2 & 3 are operated by Landlord. 2. Unit 3 pays for parking (2 stalls @ $250/month/stall). 3. Units 2 & 3 can be converted to NNN leases if new leases are negotiated. 4. County website says building is 2,154 Gross SF. 5. CAM is estimated to be $.85 psf/month.

FURSSETEAM KOKUAINVESTMENTS.COM 16 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. INCOME AND EXPENSES

69 HANA HIGHWAY Year Year 1 - Actual Year 1 - Proforma Total $/SF Total $/SF INCOME Rental Income $168,314 $88.87 $169,968 $89.74

Other Income (Parking) $6,000 $3.17 $6,000 $3.17

Expense Reimbursements $9,471 $5.00 $35,009 $18.48 Hawaii General Excise Tax (4.166%) $7,656 $4.04 $9,623 $5.08 Effective Gross Income $191,441 $101.08 $220,600 $116.47

EXPENSES Real Estate Taxes $9,637 $5.09 $9,637 $5.09

Property Insurance $2,391 $1.26 $2,391 $1.26

Landscaping $1,800 $0.95 $1,800 $0.95 Maintenance & Repairs $2,400 $1.27 $2,400 $1.27 Property Management $0 $0.00 $10,419 $5.50 Utilities - Electric $1,900 $1.00 $1,900 $1.00 Utilities - Water $865 $0.46 $865 $0.46 Operating Expenses $18,993 $10.03 $29,412 $15.53 Hawaii General Excise Tax (4.0%) $7,658 $4.04 $8,824 $4.66 Total Expenses $26,651 $14.07 $38,236 $20.19 Net Operating Income $164,791 $87.01 $182,364 $96.28

Notes: 1. Proforma Rental Income assumes all leases are converted to NNN leases. 2. 4.166% Hawaii General Excise tax is collected on income and 4.0% GET is paid. 3. Landlord currently self manages the property. 4. Tenants pay for their own electric.

FURSSETEAM KOKUAINVESTMENTS.COM 17 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. TENANT OVERVIEW

WINGS HAWAII DESIGN Wings Hawaii is a local boutique that sells a collection of handmade jewelry and women’s clothing and accessories. In 2006, they opened their first brick and mortar on Maui’s North Shore. Wings Hawaii Design is interested in expanding into Unit 2. They are the primary tenant fronting Hana Highway.

PAIA INN, LLC & BASKIN DESIGN, LLC

Michael Baskin is the managing member of both entities and is an architect, builder, and designer who is widely renowned for his refined sense of coastal style and ability to create harmony between indoor and outdoor space. He has built and designed homes and small hotels in Hawai’i, the Caribbean, California, and Thailand. A builder since 1987, his properties have been purchased by celebrities and featured in publications such as the New York Times, Travel + Leisure, Coastal Living, Men’s Journal, Sunset magazine, and more. The tenant uses the premises for weddings and events held at the adjacent property.

FURSSETEAM KOKUAINVESTMENTS.COM 18 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. CONFIDENTIAL OFFERING MEMORANDUM

Kokua Realty, LLC (“Kokua Realty”) and the seller (“Seller”) of the property referenced herein (“Property”) present this Confidential Offering Memorandum (“Memorandum”) to assist the recipient(s) (“You” or “Your”) in evaluating the Property and it is intended for Your use only. The information in this Memorandum contains brief, selected information pertaining to the Property and should not be considered all-inclusive or permanent. The information in this Memorandum has been obtained from sources believed to be reliable, but has not been verified and is not guaranteed. You should independently verify each item of and have the same reviewed by Your tax advisor and/or legal counsel. Assumptions, projections, estimates and/or opinions are provided as examples only and all information is subject to change, error, omissions and/or withdrawal without notice. Kokua Realty and Seller assume no responsibility for and make no warranty as to the accuracy or completeness of any information in this Memorandum. Kokua Realty and Seller expressly disclaim any implied or expressed warranties of merchantability, fitness for any particular purpose or non-infringement of intellectual property relating to this Memorandum. In no event shall Kokua Realty or Seller be liable for any damages resulting from the reliance on or use of any information in this Memorandum, including but not limited to direct, special, indirect, consequential or incidental damages. By accepting receipt of this Memorandum, You agree to the following (a) This Memorandum is of a highly confidential nature, will be held in the strictest confidence and shall be returned to Kokua Realty upon request; (b) You shall not contact any property manager, employee or tenant of the Property regarding the Property or this Memorandum, without prior approval of Kokua Realty or Seller; and (c) You understand and agree that Kokua Realty represents the Seller and not You. Neither Kokua Realty nor Seller shall have any obligation to pay any commission, finder’s fee, or any other compensation to any broker or other person. You may provide information to person retained to evaluate the Property only after first obtaining a signed confidentiality agreement from such persons and providing a copy of such agreement to Kokua Realty. By accepting receipt of this Memorandum, You agree to defend, indemnify and hold harmless Kokua Realty and Seller (including all of their agents, employees, subsidiaries, affiliated entities, successors and assign(s) from and against any and all claims, disputes, litigation, damages, liabilities, losses, judgments, expenses, fines, contributions, charges, injuries and/or costs and expenses, including reasonable attorneys’ fees arising or resulting from acts by You.

FURSSETEAM KOKUAINVESTMENTS.COM 19 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. The Fursse Team Marketing & Selling Investment Properties Globally

SOLD SOLD SOLD SOLD

Seattle Development Site Maui Retail Center Maui Office Building The Shoppes at Coronado Place I Seattle, WA Front Street, Lahaina, HI Wailuku, HI Blue Springs, MO $23,390,000 $6,100,000 $5,575,000 $3,760,000

FURSSETEAM KOKUAINVESTMENTS.COM 20 The information herein has been obtained from sources we believe to be reliable, however we accept no responsibility for its correctness. Exclusively Presented By The Fursse Team Marketing & Selling Investment Properties Globally

Kokua Realty, LLC is one of Hawaii’s largest commercial real KEONI FURSSE, CCIM, R (PB) Kokua Realty, LLC estate firms as ranked each year by Pacific Business News. Keoni Capital Markets Group CEO & Principal Broker Fursse, CCIM is the CEO & Principal Broker of Kokua Realty, LLC [email protected] and leads the Capital Markets Group known as The Fursse 296 Alamaha Street, Suite A Team specializing in the marketing and selling of investment 808.280.6556 Kahului, Hawaii 96732 properties nationwide and globally. When partnering with The 808.877.9000 Fursse Team, you receive superior client service from a team of experts who are dedicated to your success. Hawaii Real Estate Broker License RB-16700. KOKUAINVESTMENTS.COM Copyright ©2017 Kokua Realty, LLC. All rights reserved.