Delchamps Plaza (Kroger Shadow Center) 1829 US 45 Columbus, MS Table of Contents

Executive Summary • Legal Disclaimer 2 • Contacts • Offering Summary • Highlights • Location Overview • Aerial • Site Plan • Property Fundamentals

Financials • Rent Roll 12 • Net Operating Income

Tenant Fundamentals • Tenant Overview 16 • Lease Schedule • Tenant Mix Breakdown Market Overview 19 • Market Overview • Demographics

Contacts 23 • Contact Information

1| Delchamps Plaza Legal Conditions

THIS IS A CONFIDENTIAL MEMORANDUM intended solely for the THE SELLER EXPRESSELY RESERVES THE RIGHT AT ITS SOLE DISCRETION limited use in considering whether to pursue negotiations to acquire TO REJECT ANY OR ALL PROPOSALS OR EXPRESSIONS OF INTEREST IN Delchamps Plaza (the “Property”) located Columbus, MS and is not THE PROPERTY AND TO TERMINATE DISCUSSIONS WITH ANY PARTY AT intended to be an offer for the sale of the Property. ANYTIME WITH OR WITHOUT NOTICE.

This confidential memorandum, which contains brief, selected If the Recipient does not wish to pursue negotiations leading to this information pertaining to the business and affairs of the Property, has acquisition, or if in the future the Recipient discontinues such been prepared by The Palomar Group. This confidential memorandum negotiations, Recipient agrees to return this confidential memorandum does not purport to be all-inclusive or to contain all the information to The Palomar Group. which a prospective purchaser may desire. Neither Seller nor The Palomar Group nor any of their officers, employees or agents make any THIS CONFIDENTIAL MEMORANDUM SHALL NOT BE DEEMED A representation of warranty, expressed or implied, as to the accuracy or REPRESENTATION OF THE STATE OF AFFAIRS OF THE PROPERTY OR completeness of this confidential memorandum or any of its contents CONSTITUTE AN INDICATION THAT THERE HAS BEEN NO CHANGE IN and no legal liability is assumed or shall be implied with respect THE BUSINESS OR AFFAIRS OF THE PROPERTY SINCE THE DATE OF thereto. PREPARATION OF THIS MEMORANDUM.

By receipt of this confidential memorandum, it is agreed that the THE PALOMAR GROUP (BROKER) MAKES THE DISCLOSURE THAT ITS memorandum and its contents are confidential, that they will be held ROLE IS EXCLUSIVELY REPRESENTING THE SELLER, NOT THE BUYER AND and treated it in the strictest of confidence, that the Recipient will not, AS SUCH, BROKERS MUST WORK TO OBTAIN FOR SELLER THE BEST directly or in directly, disclose or permit anyone else to disclose this PRICE AND TERMS AVAILABLE. NEITHER SELLING BROKER OR SELLER memorandum or its contents to any other person, firm or entity ARE RESPONSIBLE FOR ANY COMPENSATION TO ANY OTHER PARTY IN without prior written authorization of the Seller, and that the Recipient CONNECTION WITH THE SALE OF THE PROPERTY. will not use or permit to be used this memorandum or its contents in any fashion or manner detrimental to the interest of the Seller. THIS PROPERTY IS BEING SOLD AS AN “AS IS,WHERE IS”SALE. Photocopying or other duplication is strictly prohibited.

2| Delchamps Plaza MS Broker of Record Colin Edwards, Sullivan Wickley Properties MS Lic #22302 Team

Ryan McArdle David Rivers Steve Collins

Partner Partner Partner 706.631.8897 706.840.0055 706.564.8556 [email protected] [email protected] [email protected]

Jefferson Knox Lee Malchow

Associate Associate 706.294.8806 706.231.7249 [email protected] [email protected]

The Palomar Group is a full-service commercial Investment Sales firm. The Investment Sales Team specializes in well positioned anchored or unanchored retail properties throughout the country. Their proven track record on both the acquisition and disposition sides are a direct result of their understanding of the marketplace, appropriate asset valuation based off current market conditions, and the alignment of assets to the most suitable and qualified Buyer/ Seller. The Team has worked on over 7 million square feet of retail, office and multifamily, having a hand in over $700 million in transactions across 12 states.

3| Delchamps Plaza % NOI Asking Price Cap Rate Square Footage Year Built $145,485 $1,763,000 8.25% 18,870 SF 1988

Major Tenants Upside Occupancy Debt Price PSF Pizza Hut, Sally Ability to grow 100% Free & Clear $93.42 Beauty, and Kidz-N- future rents Play

4| Delchamps Plaza THE OPPORTUNITY

Address STRONG NEIGHBORHOOD CENTER 1829 US 45 • Connected to corporately owned Kroger in the Golden Triangle Columbus, MS • Limited term and below market rents allows opportunity to push rents as terms expire • Significant increase in the number of national tenants in the surrounding area Parcel Number • Ability to grow future rents as the average rent at Delchamps is $10.49 psf and the average 57W130400400 small shop rent across the market for comparable centers is $11.30 psf.

Gross Leasable Area 18,870 square feet

Land Area 2.7 acres

Year Built 1988

Acquisition Price Point $1,763,000

Leasing 100% Occupancy

Upside PROPERTY FUNADMENTAL Limited term on below market rents allows opportunity to • Ability to grow future rents through renovations of the center including facades, parking $ push rents as term expire. lot, and lighting Ability to grow future rents through renovations of the • New roof – installed in 2012 and still under warranty center including facades, parking lot and lighting • Parking lot striped/repaved/seal coated in 2013

Summary of National Tenants Size Expiration Renewal Option

1,500 3/31/2022 Two 3 Year LOCATION • Next door to the only Walmart within 20 miles 1,200 7/31/2020 None • Columbus Air Force Base located just north of this site provides a steady population base for the market with 1,500 military, 412 DoD Civilian employees, and 1,000 contractors 1,770 12/31/2022 One 3 Year • High traffic volume at over 27,000 VPD • Located at a signalized traffic light providing ease of ingress and egress

5| Delchamps Plaza Location Description:

Delchamps Plaza is ideally located along a major retail corridor in Columbus, MS, immediately surrounded by dense neighborhoods and key national tenants. The center consists of one building totaling 18,870 square feet that is attached to a Kroger. The shopping center is made up of 10 bays, the smallest being 1,200 square feet, and the largest is 6,000 square feet.

There is great signage and visibility at Delchamps Plaza where over 26,000 vehicles pass by daily on Highway 45. The center benefits from five direct points of entry into the property, four of which are full access on Highway 45. The center boasts an impressive roster of diversified tenants creating a dynamic center for retailers, customers, and the surrounding residents.

6| Delchamps Plaza 27,537

19,286

Delchamps Plaza

27,414

27,532

7| Delchamps Plaza Delchamps Plaza

27,537

8| Delchamps Plaza 27,537

Delchamps Plaza

9 SUITE TENANT SQ. FT.

1801 Pizza Hut 1,500 SF 01 03 05 07 09 11 1803 Cell Phone Repair 1,200 SF 13 Geeks 15 17

1805 Crown Wireless 1,200 SF 21 REPUBLICFINANCE 1807 Kidz-N-Play 6,000 SF

1809 Weight Watchers 1,200 SF

1811 Lucky Nails 1,200 SF Lincoln Rd Lincoln 1813 Statewide Federal 1,200 SF Credit Union

1815 Southern Flour 1,200 SF Bakery

1817 Wines, Etc 2,400 SF

1821 Sally Beauty 1,770 SF Supply

TOTAL 18,870 SF

10| Delchamps Plaza Property Fundamentals Trade Area Delchamps Plaza is ideally located along a major retail corridor in Columbus, MS, immediately surrounded by dense neighborhoods and key national tenants. The center consists of one building totaling 18,870 square feet that is attached to a Kroger building. The shopping center is made up of 10 bays, the smallest being 1,200 square feet, and the largest 6,000 square feet. In addition to shadowing Kroger, the Highway 45 retail corridor boasts a large concentration of national retailers and restaurants are located along the corridor. Access The center benefits from five direct points of entry into the property, four of which are full access on Highway 45. Parking 112 Total parking spaces 5.93 spaces per 1,000 sf Traffic Counts Located on Highway 45 with over 27,000 vehicles per day.

Roof Installed August 2012 – 15 year Warranty

11| Delchamps Plaza Financials

12| Delchamps Plaza Delchamps Plaza Rent roll Lease Term Rental Rates Options/Escalations Occupancy Expiration Monthly Annual Annual Tenant Unit # S.F. % s.f. Date Date $ PSF Rent Rent Rent Start $ PSF Rent Opt/Esc Pizza Hut 1801 1,500 7.95% 4/1/1992 3/31/2022 $ 10.13 $ 1,266 $ 15,196 4/1/2022 $ 10.74 $ 16,107 Opt 4/1/2025 $ 11.38 $ 17,074 Opt Cell Phone Repair Geeks 1803 1,200 6.36% 1/1/2015 12/31/2019 $ 12.00 $ 1,200 $ 14,400 1/1/2020 $ 12.00 $ 14,400 Opt

Crown Wireless 1805 1,200 6.36% 2/1/2016 1/31/2021 $ 12.00 $ 1,200 $ 14,400 2/1/2021 $ 12.60 $ 15,120 Opt 2/1/2026 $ 13.23 $ 15,876 Opt Kidz-N-Play 1807 6,000 31.80% 4/1/2019 3/31/2022 $ 7.00 $ 3,500 $ 42,000

Weight Watchers 1809 1,200 6.36% 8/1/2004 7/31/2020 $ 12.38 $ 1,238 $ 14,856

Lucky Nails 1811 1,200 6.36% 9/1/2013 8/31/2023 $ 12.00 $ 1,200 $ 14,400

Statewide Federal Credit Union 1813 1,200 6.36% 3/1/2019 2/28/2022 $ 12.50 $ 1,250 $ 15,000

Southern Flour Bakery 1815 1,200 6.36% 6/1/2017 5/31/2021 $ 12.25 $ 1,225 $ 14,700

Wines, Etc 1817 2,400 12.72% 11/1/2011 10/31/2021 $ 13.25 $ 2,650 $ 31,800 11/1/2019 $ 13.25 $ 31,800 Esc 11/1/2020 $ 13.50 $ 32,400 Sally Beauty Supply 1821 1,770 9.38% 11/1/1988 10/31/2022 $ 12.00 $ 1,770 $ 21,240 11/1/2022 $ 13.00 $ 23,010 Opt

TOTAL 18,870 100.00% $ 10.49 $ 16,499 $ 197,992

13| Delchamps Plaza BASE RENT 18,870 100.00% $10.49 $16,499 $197,992

CAM REIMBURSEMENT $3,339 TAX REIMBURSEMENT $5,983 INS REIMBURSEMENT $1,716 OTHER REIMBURSEMENT $500

TOTAL REIMBURSEMENT INCOME $11,538

Vacancy Factor 10% ($20,953)

EFFECTIVE GROSS INCOME $188,577

Expense Summary $ p.s.f. Monthly Annually

Taxes $1.26 $1,981 $23,770

TOTAL INSURANCE * $0.37 $583 $6,991

TOTAL MANAGEMENT 3.00% $0.30 $471 $5,657

CAM Common Area $0.10 $151 $1,810 Door/Lock $0.01 $17 $201 Electrical $0.01 $23 $276 HVAC $0.03 $44 $527 Landscaping $0.04 $60 $720 Parking Lot $0.12 $184 $2,205 Pest Control $0.02 $24 $291 Sewer/Rooter $0.02 $28 $332 Misc $0.00 $0 $0 TOTAL CAM EXPENSE $0.34 $530 $6,362

NON-CAM EXPENSE $0.02 $26 $311

TOTAL EXPENSES $2.28 $43,091

NET OPERATING INCOME $145,485

* Part of umbrella policy

14| Delchamps Plaza 10 Year Cash Flow

10 YEAR CASH FLOW

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 For the Years Ending PSF 10/31/2020 10/31/2021 10/31/2022 10/31/2023 10/31/2024 10/31/2025 10/31/2026 10/31/2027 10/31/2028 10/31/2029 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Potential Gross Revenue Base Rental Revenue $ 10.50 $ 198,041 $ 194,156 $ 195,117 $ 197,457 $ 212,101 $ 214,496 $ 217,376 $ 206,847 $ 221,233 $ 220,226 Expense Reimbursement Revenue $ 0.63 $ 11,826 $ 11,969 $ 12,120 $ 11,444 $ 12,145 $ 12,906 $ 13,275 $ 13,233 $ 13,503 $ 13,624 Total Potential Gross Revenue $ 11.12 $ 209,867 $ 206,126 $ 207,236 $ 208,902 $ 224,246 $ 227,402 $ 230,651 $ 220,080 $ 234,736 $ 233,850 General Vacancy - 10.00% $ (1.11) $ (20,987) $ (20,613) $ (20,724) $ (20,890) $ (22,425) $ (22,740) $ (23,065) $ (22,008) $ (23,474) $ (23,385) Effective Gross Revenue $ 10.01 $ 188,881 $ 185,513 $ 186,513 $ 188,011 $ 201,821 $ 204,662 $ 207,586 $ 198,072 $ 211,263 $ 210,465 Capture 28% 27% 27% 25% 26% 27% 28% 27% 27% 27%

Operating Expenses CAM $ 0.34 $ 6,362 $ 6,489 $ 6,619 $ 6,751 $ 6,886 $ 7,024 $ 7,165 $ 7,308 $ 7,454 $ 7,603 Insurance $ 0.37 $ 6,991 $ 7,131 $ 7,273 $ 7,419 $ 7,567 $ 7,719 $ 7,873 $ 8,030 $ 8,191 $ 8,355 Taxes $ 1.26 $ 23,770 $ 24,245 $ 24,730 $ 25,225 $ 25,729 $ 26,244 $ 26,769 $ 27,304 $ 27,850 $ 28,407 Management Fee - 3.0% $ 0.30 $ 5,657 $ 5,770 $ 5,886 $ 6,003 $ 6,123 $ 6,246 $ 6,371 $ 6,498 $ 6,628 $ 6,761 Total Operating Expenses $ 2.27 $ 42,780 $ 43,636 $ 44,508 $ 45,398 $ 46,306 $ 47,233 $ 48,177 $ 49,141 $ 50,124 $ 51,126 $ 0.30 Net Operating Income $ 7.74 $ 146,101 $ 141,877 $ 142,004 $ 142,613 $ 155,515 $ 157,429 $ 159,408 $ 148,931 $ 161,139 $ 159,339

15| Delchamps Plaza Tenant Fundamentals

16| Delchamps Plaza Pizza Hut Website: www.pizzahut.com Parent: Yum! Brands NYSE: YUM 2018 Revenue: 5.7 Billion

Pizza Hut is an American restaurant chain and international franchise which was founded in 1958 in Wichita, Kansas by Dan and Frank Carney. The company is known for its Italian-American cuisine menu, including pizza and pasta, as well as side dishes and desserts. Pizza Hut has 18,431 restaurants worldwide as of December 31, 2018, making it the world's largest pizza chain in terms of locations. It is a subsidiary of Yum! Brands, Inc., one of the world's largest restaurant companies.

Weight Watchers Website: www.ww.com NYSE: WW 2017 Revenue: $1.3 Billion

WW International, Inc., formerly Weight Watchers International, Inc., is a global company headquartered in the U.S. that offers various products and services to assist in healthy habits, including weight loss and maintenance, fitness, and mindset such as the Weight Watchers comprehensive diet program. Founded in 1963 by Queens, New York City homemaker Jean Nidetch, as of 2018 it delivers its program in three combined ways: online via its mobile app and website, coaching online or by phone, and optional in-person meetings around the world. The core philosophy behind Weight Watchers programs is to use a science-driven approach to help participants lose weight by forming healthy habits, eating smarter, getting more exercise, and receiving support.

Sally Beauty Holdings Website: www.sallybeauty.com NYSE: SBH 2017 Revenue: $3.9 Billion

Sally Beauty Holdings, Inc. (NYSE: SBH) is an American international specialty retailer and distributor of professional beauty supplies with revenues of more than $3.9 billion annually. Through the Sally Beauty Supply and Beauty Systems Group businesses, the Company sells and distributes through over 4,000 stores, including approximately 200 franchised units, throughout the United States, the United Kingdom(SALON SERVICES 100SHOPS, www.salon-success.co.uk), Belgium(pro- duo 40SHOPS M&A ), Canada, Chile,Peru, Puerto Rico, Mexico(2000 Amstrong McCall 130 shops M&A), France, Ireland, Spain and Germany.

Cricket Wireless Website: www.cricketwireless.com Parent: AT&T

Cricket Wireless LLC, simply known as Cricket Wireless or Cricket, is a wholly owned subsidiary of AT&T, that provides wireless services to 10 million subscribers in the United States. Cricket Wireless was founded in March 1999 by Leap Wireless International. AT&T acquired Leap Wireless International in March 2014 which merged Cricket Wireless with Aio Wireless. Before AT&T's acquisition, the company had 4.5 million subscribers. In July 2013, AT&T agreed to buy Cricket Wireless' parent for $1.2 billion. The FCC approved the acquisition between AT&T and Leap Wireless in March 2014.

17| Delchamps Plaza Internet-Proof Tenant Mix

7% 40% 31%12% 8% 21%43%

SERVICE Food/Drink Finance Childcare OREINTED (40% OF REVENUE) (31% OF REVENUE) (8% OF REVENUE) (21% OF REVENUE)

National & Regional Tenant Line-Up

30% of the Property’s leased GLA is comprised of national or regional tenants

NATIONAL TENANTS LOCAL TENANTS 30%

70%

National Local

18| Delchamps Plaza Market Overview

19| Delchamps Plaza Golden Triangle (Columbus, Starkville and West Point)

Largest Employers in the Area

Mississippi State Columbus Airforce Base 4,500 Employees 3,000 Employees

K-12 Schools Walmart 1,500 Employees 1,000 Employees

Golden Triangle • The "triangle" is formed by the cities of Columbus, Starkville, and West Point but the region is often more broadly-defined to include all of Clay, Lowndes, and Oktibbeha counties. • The area's economic development potential is anchored by the presence of Mississippi State University, Columbus Air Force Base, and associated spin-off industries in research, high-tech manufacturing, aerospace, transportation, and education. • Voted sixth in USA Today's Best Small-Town Cultural Scene • Population:128,000

20| Delchamps Plaza 3 Mile Population 5 Mile Population 10 Mile Population 17,800 31,600 54,200

31,500 54,000 17,750 31,400 53,800 17,700 31,300 53,600 31,200 17,650 31,100 53,400 17,600 31,000 53,200 2010 2019 2024 2010 2019 2024 2010 2019 2024

Population: 3 Mile 5 Mile 10 Mile Household Income 3 Mile 5 Mile 10 Mile 2024 Projection 17,703 31,551 54,152 2019 Avg Household Income $59,385 $56,069 $60,278 2019 Estimate 17,680 31,386 53,872 2010 Census 17,787 31,246 53,618 2024 Avg Household Income $67,352 $79,415 $68,641 Growth 2019-2024 0.13% 0.53% 0.52% Growth 2010-2019 -0.6% 0.45% 0.47%

2019 Households by Households: 3 Mile 5 Mile 10 Mile 3 Mile 5 mile 10 Mile 2024 Projection 7,264 12,669 21,335 Household Income: <$15,000 1,771 2,820 3,826 2019 Estimate 7,247 12,608 21,232 $15,000 - $25,000 1,014 1,732 2,606 2010 Census 7,301 12,611 21,188 $25,000 - $35,000 648 1,245 2,033 Growth 2019 - 2024 0.23% 0.48% 0.49% $35,000 - $50,000 1,042 1,788 2,981 Growth 2010 - 2019 -0.74% -0.02% 0.21% $50,000 - $75,000 870 1,860 3,774 $75,000 - $150,000 697 1,407 2,741 $100,000 - $200,000 673 1,129 2,196 $150,000+ 530 627 1,075

21| Delchamps Plaza CAFB reports $315M in economic CPR Expands Services with the impact in FY 2018 Opening of a New Store in Columbus June 21, 2019 October 1, 2019 CPR Cell Phone Repair, the largest and fastest growing retail mobile device repair franchise network in North The Columbus Air Force Base generated an economic impact of $315 million in Columbus and the Golden America, is pleased to announce the opening of a new store in Columbus, MS. The franchise congratulates Triangle area in Fiscal Year 2018, according to a report released by the base. Ben Mitchell on the opening of his CPR franchise store. Col. Samantha Weeks, 14th Flying Training Wing commander, presented the report Thursday at a luncheon "On behalf of CPR Corporate, I would like to welcome Ben to our network. With his experience in the hosted by the Base Community Council. technology industry, we know that Ben and his team will be a great asset to the community of Columbus," said Chris Jourdan, Director of Franchise Operations. Fiscal Year 2018's economic impact of $315 million represents an increase of 16 percent --around $44 million -- up from $271 million in FY 2017, according to the report. Between fiscal years 2014 and 2017, year-to-year Located in East Mississippi, Columbus was voted sixth in USA Today's Best Small Town Cultural Scene. growth has ranged from about $9 million to $11 million. Tourists travel to Columbus to tour the Tennessee Williams Home and Welcome Center, explore the African- American Heritage Tour, and visit several historic Civil War sites. Alongside the rich history, Columbus Base payroll comprised $158 million of the local economic impact and increased by $12 million in the past year, residents enjoy golf courses, fishing, and boating on the Tennessee-Tombigbee Waterway, camping, and according to the report. On base, there are 3,302 total assigned personnel, a year-to-year increase of 495, with numerous parks. The economy is mainly centered around providing materials for military aircraft at Columbus additional military, civil service and contract hires. Construction contracts were up by $25 million. Air Force Base. Among the top employers are Steel Dynamics, Inc., Paccar, American Eurocopter, and Stark Aerospace. CPR Columbus is conveniently located in the Kroger plaza on Highway 45. Read More Read More

The Role of Mississippi State University Aldermaen OK retail center TIF to bring in helping to Grow the State’s Economy in ALDI, TJ Maxx August 21, 2019 The role of Mississippi State University in helping to grow and strengthen the state’s economy STARKVILLE -- Starkville is one step closer to bringing in an ALDI grocery store and a TJ Maxx can be identified and measured in several ways. Ultimately, a major goal of the university is to department store thanks to a tax-increment financing plan the Starkville Board of Aldermen help retain, recruit, and create high-tech and high-wage jobs. The purpose of this report is to approved Tuesday with a 5-2 vote. illustrate the university’s contributions to local and regional economic development in the state. The report includes information regarding several components; a pilot Economic Development Castle Properties requested the TIF to develop a retail shopping center at the intersection of Assistance Network (EDAN) initiative, economic impact of university research funding, analysis Highway 12 and Industrial Park Road, the current 10-acre site of the Garan Manufacturing plant. of university-industry collaborations, innovation-based job creation data, industry recruitment Garan is planning to relocate to the North Star Industrial Park at Highways 82 and 389. assistance, and an overview of the Thad Cochran Research Technology and Economic Development Park. The industrial plant being the first North Star tenant and a new development replacing the old site is "kind of a two-fold win" for the city, Ward 1 Alderman Ben Carver said. Read More Read More

22| Delchamps Plaza Contact Us

Ryan McArdle Partner 706-631-8897 [email protected]

David Rivers Partner 706-840-0055 [email protected]

Steve Collins Partner 706-564-8556 [email protected]

Lee Malchow Associate 706.231.7249 [email protected]

Jefferson Knox Associate 706.294.8806 [email protected]

thepalomargroup.com

706-407-4443

MS Broker of Record Colin Edwards, Sullivan Wickley Properties 206 Pitcarin Way Suite A MS Lic #22302 Augusta, GA 30909

23| Delchamps Plaza