Medical Tower Encino

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A 48,590 SF MEDICAL OFFICE BUILDING WITH SIGNIFICANT RENTAL ENCINO UPSIDE IDEALLY LOCATED IN THE AFFLUENT LOS ANGELES COUNTY SUB-MARKET OF ENCINO, CALIFORNIA 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 ENCINO

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316

INVESTMENT ADVISORS:

BRANDON MICHAELS TEAM MEMBERS Senior Managing Director of Investments Sean Brandt Senior Director, National Retail Group Ben Brownstein Tel: (818) 212-2794 Nicole Cottrell Fax: (818) 212-2710 Dana Liu [email protected] Steven Schechter License: CA #01434685 Austin Sreden www.BrandonMichaelsGroup.com

CONFIDENTIALITY AND DISCLAIMER The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written con- sent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective pur- chasers, 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. Marcus & Millichap 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 or absence of contaminating substances, PCB’s or asbestos, the com- pliance with State and Federal regulations, the physical condition of the improvements thereon, or the 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 Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap 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. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2018 Marcus & Millichap. All rights reserved. TABLE OF CONTENTS NON-ENDORSEMENT NOTICE Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing pack- age. The presence of any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers. ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS. 1 2 3 4 EXECUTIVE SUMMARY FINANCIAL ANALYSIS COMPARABLE ANALYSIS AREA OVERVIEW

16830 Ventura Blvd. Suite 100, Encino, CA 91436 www.marcusmillichap.com EXECUTIVE SUMMARY

4 5 ENCINO

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316

ENCINO• CA A 48,590 SF MEDICAL OFFICE BUILDING WITH SIGNIFICANT RENTAL ENCINO ENCINO UPSIDE IDEALLY LOCATED IN THE AFFLUENT LOS ANGELES

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 COUNTY SUB-MARKET OF ENCINO, CALIFORNIA 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 ON PRESTIGIOUS VENTURA BOULEVARD.

The Brandon Michaels Group of Marcus & Millichap has been selected to market for sale the Encino Medical Tower, a 48,590 square foot medical office building located at 17835 Ventura Boulevard in the high-end, affluent LA County sub-market of Encino, CA.

Encino Medical Tower is ideally located along Ventura Boulevard, on the north side of the Boulevard, just west of White Oak Avenue and just east of Zelzah Avenue. The subject property consists of a three story, class B office building with 100 surface parking spaces ideally situated on 53,008 square feet of land consisting of two separate parcels. The front parcel is 40,144 square feet of land zoned C4-1VL and RA-1. The rear parcel is 12,864 square feet of land zoned RA.

The Encino Medical Tower has undergone a medical conversion in which 82% of the building (40,000 SF) is allowed for medical use. Encino Medical Tower is currently 81% occupied to general office tenants, with an average rent of $2.26 per SF. Medical rents in the immediate designated area average $3.44 per square foot. The average unit size is 1,970 square feet with the largest unit being 4,285 square feet. These are ideal suite sizes to serve the local tenant mix and require minimal tenant improvement costs between tenants. With 53% of the existing leases expiring by 2020 and 93% of the current leases expiring by 2022, this offering presents a unique opportunity to acquire a value-add medical office building well located along Ventura Boulevard in Encino. The flexibility in the current lease structure combined with the current occupancy creates an ideal opportunity for an investor or owner-user Buyer.

The Encino Tower has recently undergone significant upgrades and improvements which create a positive business environment and will attract top tenants. Improvements include completely remodeled common areas, brand new entry door security with access cards, brand new lighting in the common areas, a brand new lobby with back painted glass, and a laundry list of additional improvements.

ENCINO, CALIFORNIA IS AN URBAN PARADISE WELL-KNOWN ENCINO FOR ITS AFFLUENT DEMOGRAPHIC, DENSE POPULATION, AND MULTI-MILLION DOLLAR HOMES 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316

The Encino Tower benefits from an amenity rich Encino, California location offering a plethora of dining and entertainment options along world renowned Ventura Boulevard. Ventura Boulevard is the main commercial thoroughfare through the San Fernando Valley, and the world’s longest avenue of contiguous business.

Encino is a dense San Fernando Valley neighborhood that benefits from strong local business and a wide array of housing options. The dense immediate submarket boasts a population of over 468,000 people within a five-mile radius. The affluent area has an average household income of over $103,000 within a three-mile radius, and over 163,000 households within five miles, 10% with household incomes north of $200,000.

Homes South of Ventura Boulevard range from $2 million to $50 million and offer some of the most expansive residences in Southern California. The city is the home of numerous celebrities, executives, athletes, and entertainers. The local economy provides jobs in health care, social services, and professional services. A host of athletes, celebrities, and professionals call Encino home. The local economy provides jobs primarily in health care, social services, and professional services. There are over 26,000 businesses and over 212,000 employees within a five-mile radius, further encapsulating the strength of the location.

The San Fernando Valley has experienced consistent population growth since 2000, and population growth is projected for the foreseeable future. Valley residents, on average, are more educated than other parts of the City and County with 118,575 people with graduate or professional degrees and another 239,705 with bachelor’s degrees. Since 2000, the Valley has had a 16.6% increase (59,689) in those with bachelor’s or advanced degrees. Valley residents have access to renowned colleges and universities, such as California State University, Northridge, Woodbury University, Pierce College, Valley College, and Mission College.

ENCINO

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316

EXCELLENT ENCINO, CA LOCATION VALUE-ADD OPPORTUNITY WITH A ▶ Ideally located just west of White Oak Avenue along MULTITUDE OF OPTIONS prestigious Ventura Boulevard ▶ Current office rents average $2.26 per square foot ▶ 130 feet of linear frontage along Ventura Boulevard ▶ Medical rents in the immediate area average $3.44 per ▶ Amenity rich submarket with multiple restaurants, square foot retailers, office, and hotels in the immediate area ▶ 93% of the existing leases expire by 2022 ▶ Close proximity to the 101 Ventura Freeway ▶ 81% current occupancy and flexibility in lease expiration ▶ Centralized San Fernando Valley location with easy access creates a unique opportunity for an investor or Owner-User to Downtown Los Angeles, the Westside of Los Angeles, Buyer Warner Center, and all major airports HIGH-END MEDICAL OFFICE BUILDING AFFLUENT AND DENSE LOS ANGELES

▶ 48,590 square foot medical office building of which 40,000 COUNTY SUB-MARKET square feet (82%) is designated for medical use ▶ Average household income over $103,000 ▶ 53,008 square feet of land ▶ Dense immediate population with over 468,000 people within a ▶ Memorable brick façade with excellent window lines five mile radius ▶ Upgraded lobby and corridors ▶ There are over 163,000 households within five miles, 10% with ▶ Significant improvements and upgrades create a positive household incomes north of $200,000. business environment ▶ There are over 26,000 businesses and over 212,000 employees ▶ Excellent Ingress and egress within a five-mile radius, further encapsulating the strength of the location. ▶ Secured parking with easy access

12 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 13 IMPROVEMENTS AND UPGRADES

REMODELED COMMON AREAS ENTRY DOOR SECURITY NEW LIGHTING PAINTED GLASS DOORS Complete Remodeling of Entry Door Security All New Lighting in Full Remodel of Lobby with all Common Areas with Access Card Common Areas back Painted Glass

IMPROVEMENTS & UPGRADES

• Full remodel of 6 bathrooms • Recoating of roof with elastomeric coating • Complete remodeling of all common areas • Complete re-carpeting throughout the building • New office entry door, handles, and locks • Retiling of common areas • Remodeling of interior elevators • Full remodel of lobby with back painted glass • Brand new landscaping in the front and rear of the property • Entry door security with access card • Securing of rear parking area with gates • All new lighting in the common areas and lobby • New computerized directory system • Installation of timers for all A/C units

14 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 15 MEDICAL EXPANSION IN THE IMMEDIATE AREA PROVIDENCE CEDARS-SINAI TARZANA MEDICAL CENTER

▶ A $540 Million Expansion Project Located 1.1 Miles from Encino Medical Tower ▶ Two of Southern California's Leading Healthcare Organizations Agreed to Create a Joint Venture ▶ Project is Underway and is Expected to be Completed by 2022 ▶ Providence Tarzana Medical Center and Cedars-Sinai Hospital Were Ranked Within the Nation’s top 50 Hospitals by Healthgrades in 2018

PROVIDENCE ST. JOSEPH ANNOUNCES CO-OWNERSHIP DEAL

WITH CEDARS-SINAI AT TARZANA HOSPITAL PROVIDENCE TARZANA MEDICAL CENTER 0.9 Miles From Encino Medical Tower Two of Southern California's leading nonprofit healthcare organizations have agreed to create a joint venture that will own and operate Providence Tarzana Medical Center. ENCINO Providence St. Joseph Health and Cedars-Sinai are coming together to enhance 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 access to highly skilled medical care, specialized services and advanced health programs for the Tarzana community. The medical center's new name will be Providence Cedars-Sinai Tarzana Medical Center. Providence and Cedars-Sinai will jointly continue the build-out and redevelopment of the Tarzana campus, including a new patient-care tower with all private rooms, an expanded Emergen- cy Department, new diagnostic and treatment services, and enhanced outpatient and ambulatory services already under development. When complete in 2022, the new hospital will be a destination medical center for the area.

The joint venture will expand primary and specialty care services on the Provi- dence Tarzana campus as well as enhance other programs, including heart, can- cer and women's services. For particular services, such as those serving trans- plant patients, the partnership will provide a continuum of care that ensures access to high-quality care during every phase of the healing process.

Source: Daily News, cshs.org 16 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM Select Medical Providers PROXIMITY TO HOSPITALS Within Close Proximity 20 DIGNITY HEALTH NORTHRIDGE HOSPITAL 4 Encino Medical Tower is located approximately 0.9 miles from Providence Tarzana Medical Center, 2.5 1 Tarzana Medical Urgent Care -0.2 Miles

miles from Encino Medical Center, 4.3 miles from Dignity Health Northridge Hospital, 4.1 miles from WEST HILLS HOSPITAL Kaiser Permanent Woodland Hills, and 8.6 from West Hills Hospital. There are multiple senior assisted 2 Providence Tarzana Medical Center -0.9 Miles living facilities nearby, including AvantGarde Senior Living in Tarzana, Encino Terrace Senior Living in 8 3 Encino Hospital Medical Center -2.5 Miles Encino, Brookdale South in Tarzana, and Belmont Village Senior Living in Tarzana and Encino. 4 Dignity Health Northridge Hospital - 4.3 Miles 5 Kaiser Permanente-Woodland Hills -4.1 Miles 6 Sherman Oaks Hospital -5.8 Miles Encino Hospital Medical Center is a 150-bed, not-for-profit, acute-care community hospital, and a member 7 Valley Presbyterian Hospital -5.8 Miles ENCINO of the Prime Healthcare Foundation, a 501(c)3 public charity. It is staffed with 330 physicians and 420 8 West Hills Hospital -8.6 Miles 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 professional support staff. Servicing the greater San Fernando Valley, Encino Hospital provides 24/7 KAISER PERMANENTE 7 WOODLAND HILLS PROVIDENCE TARZANA emergency services in addition to a wide range of highly specialized medical, surgical and diagnostic MEDICAL CENTER 9 Rejuvenation Surgicenter -0.9 Miles services. 10 Center For Comprehensive Health -0.4 Miles Providence Tarzana Medical Center has served a rapidly growing San Fernando Valley community since 1973. The 249-bed hospital is known in the area as a leading source for quality care, delivering 11 Encino Urgent Care -0.2 Miles babies, providing Emergency life-saving care and performing the surgeries and other procedures to improve our patients’ health. Providence Tarzana has received numerous awards from leading national 12 California Center For Plastic -2.7 Miles 13 5 healthcare quality rating organizations. ENCINO HOSPITAL 2 10 13 Woodland Hills Urgent Care -5.7 Miles MEDICAL CENTER Northridge Hospital Medical Center is a 409-bed not-for-profit hospital, that has earned the Gold Seal of 14 AIM Healthcare Foundation -4.6 Miles Approval from The Joint Commission. It is ranked as one of America’s 100 Best Hospitals in the United 1 States by Healthgrades—a national healthcare ratings organization. It is now celebrating 60 years of 15 Valley Healthcare -4.8 Miles 9 16 growing with the community, evolving into a 409-bed nonprofit facility serving 2 million residents. 17 16 Kidney Center Inc -4.8 Miles 15 11 6 18 Kaiser Permanente is an American integrated managed care consortium, based in Oakland, California, 3 United States, founded in 1945 by industrialist Henry J. Kaiser and physician Sidney Garfield. KP's 17 Burn Center Recovery -4.8 Miles 12 14 quality of care has been highly rated and attributed to a strong emphasis on preventive care, its doctors 18 being salaried rather than paid on a fee-for-service basis, and an attempt to minimize the time patients AHF Health Care Ctr -4.8 Miles 19 spend in high-cost hospitals by carefully planning their stay. 19 Warner Center Psychiatric Med -4.9 Miles West Hills Hospital & Medical Center offers the full complement of advanced technology, compassion 20 Northridge Urgent Care -5.0 Miles and responsive care for the improvement of human life. Our expert physicians and clinicians, and every employee, strive each day to bring outstanding service to the bedside. Serving the West Valley for more than 50 years, West Hills Hospital brings quality care, close to home.

18 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP PROPERTY HIGHLIGHTS

ENCINO

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316

PROPERTY INFORMATION FINANCIAL INFORMATION

Building SF 48,590 Price $14,500,000

LAND SF 53,590 Price SF (Building) $298

Current Occupancy 81% Price SF (Land) $274

Zoning C4-1VL and RA-1 Current Cap Rate @ 81% Occupancy 4.76% APN Number 2162-012-082 & 2162-012-083 Stabilized Cap Rate @ 95% Occupancy 6.20% Year Built 1972 Type of Ownership Fee Simple Pro Forma Cap Rate - Medical 8.16%

SUMMARY OF TERMS INTEREST OFFERED 100% fee simple interest in 17835 Ventura Boulevard, a 48,590 SF three story, medical office building in Encino, CA. TERMS OF THE SALE Property is being offered on a free and clear basis. PROPERTY TOURS Prospective purchases are encouraged to visit the site and review all due dilligence materials prior to submitting offers. Access to an outline due dilligence is available portal. All property tours must be coordinated through the listing team.

ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 21 PROPERTY DETAILS

ADDRESS 17835 Ventura Boulevard Encino, CA 91316 40,000 SF of Medical SITE Space (82.23%) Along Ventura Boulevard, on the north side of the Boulevard, just west of White Oak Avenue and just east of Zelzah Avenue SQUARE FOOTAGES The subject property consists of a three story, class B office building with 100 surface parking spaces on 53,008 square feet of land consisting of two separate parcels 212,670 CROSS STREETS 212,670 Businesses in a ENCINO The cross streets are Ventura Boulevard and Zelzah Avenue 5-mile Radius

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 TRAFFIC COUNTS The traffic counts at the signalized corner of Ventura Boulevard and White Oak Avenue is 24,070 vehicles per day and 25,649 along White Oak and Magnolia Boulevard. PARKING The property offers 100 total parking spaces, a parking ratio of 2.06 per 1,000 SF 100 100 Surface Spaces YEAR BUILT Ratio of 1.89/1,000 SF The property was built in 1972 ZONING The zoning is C4-1VL, RA-1 APN NUMBER The APN number is 2162-012-082 and 2162-012-083 81% MEDICAL USE 81% of the Office Building is Currently Occupied 40,000 SF (82.32%) of the total square footage is designated for medical use

22 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 23 FINANCIAL ANALYSIS FINANCIAL ANALYSIS FINANCIAL ANALYSIS

RENT ROLL INCOME AND EXPENSE OPERATING EXPENSES LEASE LEASE BASE PRO FORMA PRO FORMA SUITE # TENANT SF % RENT RENT/SF CURRENT STABILIZED START EXPIRATION YEAR RENT RENT/SF PRO FORMA PER YEAR PER SF @ 81% @ 95% MEDICAL 100 App Nexus Inc. 3760 8.28% 7/1/2017 6/30/2022 2017 $8,775.76 $2.33 - - OCCUPANCY OCCUPANCY Taxes (1.25%) $181,250 $3.73 101 Matthew Esserman 435 0.96% 4/1/2009 3/31/2019 2009 $1,087.50 $2.50 - - Scheduled Lease Income $1,005,918 $1,281,592 $1,817,700 Insurance $10,343 $0.21 103 Vacant 900 1.98% - - - $2,385.00 $2.65 Increase in Property Tax Above Base Year $47,598 $47,598 $47,598 Repairs & Maintenance $13,000 $0.27 104 Robins Holdings Inc. 1016 2.24% 3/1/2010 2/29/2019 2016 $2,263.52 $2.23 - - Janitorial Contract $21,785 $0.45 Effective Gross Income $1,053,516 $1,329,190 $1,865,298 105 Servpro 860 1.89% 6/1/2018 2/28/2020 2018 - - Janitorial Supplies $14,558 $0.30 Vacancy - 5% $66,459 5% $94,634 107 Servpro 846 1.86% 5/1/2016 2/28/2020 2018 $15,933.96 $2.52 - - Elevator Contract $3,350 $0.07 Expenses $414,573 $414,573 $414,573 108 Servpro 3397 7.48% 2/1/2016 2/28/2020 2018 - - Landscaping/Gardening $1,950 $0.04 110 Servpro 1220 2.69% 3/1/2016 2/28/2020 2018 - - Additional Income - Sprint $27,376 $27,376 $27,376 Management Fee $35,207 $0.72 111 McKeehan Escrow Co. 1277 2.81% 11/1/1993 11/30/2020 2016 $2,721.05 $2.13 - - Additional Income - United Valet Parking $24,000 $24,000 - Alarm System $3,316 $0.07 200 Century 21 2745 6.05% 1/1/2012 12/31/2021 2012 $5,908.01 $2.15 - - Net Operating Income $690,318 $899,533 $1,365,477 Utilities - Power, Water, Sewer, Fire $119,928 $2.47 201 Steve Warner 1700 3.75% 8/1/2017 7/31/2020 2017 $3,787.41 $2.23 - - Gas $1,367 $0.03 203 Opdahl & Co. 702 1.55% 4/15/2015 6/30/2022 2018 $1,563.98 $2.23 - - Trash $8,518 $0.18 204 Pillemer & Pillemer 2921 6.44% 3/1/2013 3/31/2021 2013 $7,371.41 $2.52 - - Total $414,573 $8.53/ $0.71 207 The Breakthrough Clinic 879 1.94% 1/15/2017 2/28/2021 2017 $2,308.69 $2.63 - - 209/211 Apposite Technologies, LLC 2951 6.50% 2/1/2018 3/31/2023 2018 $6,838.94 $2.32 - - PROPERTY TAX INFORMATION 210A Vacant 2957 6.51% - - - $7,836.05 $2.65 Current Property Taxes $116,172 210B Vacant 910 2.00% - - - $2,411.50 $2.65 Projected Property Taxes $175,000 300 Advanced Sleep Med 4285 9.44% 10/1/2014 11/30/2020 2018 $8,606.55 $2.01 - - Increase $58,828.00/$0.10 SF Monthly 301 Advanced Sleep Med 1700 3.75% 12/1/2016 11/30/2020 2018 $3,589.55 $2.11 - - 303 Vacant 3902 8.60% - - - $10,340.30 $2.65 306 Steven Robert Fox 1892 4.17% 5/1/2005 5/31/2020 2015 $4,258.93 $2.25 - - 307 Christina Cassel & Paul Mitchell 605 1.33% 7/1/2014 6/30/2019 2014 $1,361.87 $2.25 - - 310 Ben Hyatt 3528 7.77% 9/1/2008 11/30/2022 2018 $7,449.37 $2.11 - - TOTAL 45,388 100% $83,826.50 $2.28 $22,972.85 Roof Sprint 0 0.00% 1/30/2001 1/27/2026 N/A $2,281.31 - - Parking United Valet Parking 3/1/2018 3/31/2023 $2,000.00

PRICING LEASE EXPIRATION ANALYSIS PRO FORMA MEDICAL ANALYSIS

YEAR SF EXPIRING % PRO FORMA MEDICAL ANALYSIS Price $14,500,000 2019 2,056 6% Total SF 48,590 Medical Rent - $3.25/SF x 40,000 SF $1,560,000 Price/SF $298 2020 17,177 47% Medical SF (81%) 40,000 Office Rent - $2.25/SF X 8,590 SF $257,700 Price/SF (Land) $274 2021 6,545 18% Office SF (19%) 8,590 Scheduled Lease Income $1,817,700 Building SF 48,590 2022 7,990 22% Sprint Income $27,376 Land SF 53,008 2023 2,951 8% 8,590 Property Tax Overage $47,598 Office SF Year Built 1972 Vacant 8,669 19% Effective Gross Income $1,892,673 Current CAP Rate @ 81% Occupancy 4.76% Total 45,388 100% Current Expenses $414,573 Stabilized Cap Rate @ 95% Occupancy 6.20% Increased Utilities/Medical-15% Increase $17,989 Pro Forma CAP Rate - Medical 8.16% 48,590 Vacancy @ 5% $94,634 Current Occupancy 81% TOTAL BUILDING SF Net Operating Income $1,365,477

PROJECTED LEASING EXPENSES - MEDICAL

Vacant 40,000 Tenant Improvements - $50 $2,000,000 Medical SF Leasing Commission - 5% $234,000

2019 Total $2,234,000

2020 TOTAL COSTS - PURCHASE PRICE + MEDICAL IMPROVEMENTS Price $16,734,000 2021 Price/SF $344 Cap Rate After Costs 8.16% 2022

2023

0% 5% 10% 15% 20% 25% 30% 35% 40%

SALES COMPARABLES | PRICE / SF ENCINO MEDICAL TOWER 1 Park Hill Medical Plaza & West Hills Medical Campus $800.00 $740.20 2 Northridge III 3 $700.00 3 Facey Medical Center $607.43 4 Oaks Professional $600.00

$445.32 5 4529 Sherman Oaks Ave $500.00 $438.64 $410.46 6 15450 Ventura Blvd $378.54 $344.04 $400.00 7 $297.73 Encino Office Plaza $285.38 2 $300.00 ENCINO 8 Tarzana Professional Bldg

17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 1 $200.00

$100.00

$0.00 8 Park Hill Medical Plaza & Northridge III Facey Medical Center Oaks Professional 4529 Sherman Oaks Ave 15450 Ventura Blvd Encino Office Plaza Tarzana Professional Bldg Average 4 West Hills Medical Campus 7 6 5 $439.64 $309.06 AVG PRICE AVG PRICE PER SF BUILDING PER SF LAND

PRICE/SF LAND PRICE/SF CAP CLOSE OF 1 Park Hill Medical Plaza & West Hills Medical Campus - 7325 Medical Center Dr, West Hills, CA 91307 # ADDRESS SALE PRICE BLDG SF (BUILDING) SF (LAND) RATE ZONING ESCROW Park Hill Medical Plaza & Sales Price $16,300,000 West Hills Medical Campus 1 $16,300,000 43,060 $378.54 41,382 $393.89 6.03% CR 07/31/2017 BLDG SF 43,060 7325 Medical Center Dr West Hills, CA 91307 Price/SF (BLDG) $378.54 Northridge III Land SF 41,382 2 18460 Roscoe Blvd $11,300,000 25,375 $445.32 38,085 $296.71 - C2 05/12/2017 Price SF/Land $393.89 Northridge, CA 91325 Cap Rate 6.03% Facey Medical Center Zoning CR 3 11155-11165 Sepulveda Blvd $13,725,000 33,438 $410.46 133,346 $102.93 6.10% LAP 02/23/2018 Mission Hills, CA 91345 Close of Escrow 07/31/2017

Oaks Professional 2 Northridge III - 18460 Roscoe Blvd, Northridge, CA 91325 4 4940 Van Nuys Blvd $11,065,000 32,162 $344.04 46,609 $237.40 4.30% C1.5-R3 09/19/2017 Sales Price $11,300,000 Sherman Oaks, CA 91403 BLDG SF 25,375 4529 Sherman Oaks Ave Price/SF (BLDG) $445.32 5 $2,550,000 4,198 $607.43 4,792 $541.03 - C1-1 01/05/2017 Sherman Oaks, CA 91403 Land SF 38,085 Price SF/Land $296.71 15450 Ventura Blvd Cap Rate - 6 $3,775,000 5,100 $740.20 9,583 $393.92 1.25% LAC4 11/07/2017 Sherman Oaks, CA 91403 Zoning C2 Close of Escrow 05/12/2017 Encino Office Plaza C41VL/ 7 17555 Ventura Blvd $9,800,000 32,916 $297.73 47,480 $206.40 5.80% 03/19/2018 3 Facey Medical Center - 11155-11165 Sepulveda Blvd, Mission Hills, CA 91345 R1VL Encino, CA 91316 Sales Price $13,725,000 BLDG SF 33,438 Tarzana Professional Bldg Price/SF (BLDG) $410.46 8 19634 Ventura Blvd $6,800,000 23,828 $285.38 22,651 $300.20 - C2 05/03/2017 Tarzana, CA 91356 Land SF 133,346 Price SF/Land $102.93 Average $9,414,375 25,010 $438.64 42,991 $309.06 4.70% Cap Rate 6.10% Zoning LAP Close of Escrow 02/23/2018 34 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 35 SALES COMPARABLES SALES COMPARABLES

4 Oaks Professional - 4940 Van Nuys Blvd, Sherman Oaks, CA 91403 7 Encino Office Plaza - 17555 Ventura Blvd, Encino, CA 91316 Sales Price $11,065,000 Sales Price $9,800,000 BLDG SF 32,162 BLDG SF 32,916 Price/SF (BLDG) $344.04 Price/SF (BLDG) $297.73 Land SF 46,609 Land SF 47,480 Price SF/Land $237.40 Price SF/Land $206.40 Cap Rate 4.30% Cap Rate 5.80% Zoning C15-R3 Zoning C4VL/R1VL Close of Escrow 09/19/2017 Close of Escrow 03/19/2018

5 4529 Sherman Oaks Ave, Sherman Oaks, CA 91403 8 Tarzana Professional Bldg - 19634 Ventura Blvd, Tarzana, CA 91356 Sales Price $2,550,000 Sales Price $6,800,000 BLDG SF 4,198 BLDG SF 23,828 Price/SF (BLDG) $607.43 Price/SF (BLDG) $285.38 Land SF 4,792 Land SF 22,615 Price SF/Land $541.03 Price SF/Land $300.20 Cap Rate - Cap Rate - Zoning C1-1 Zoning C2 Close of Escrow 01/05/2017 Close of Escrow 05/03/2017

6 15450 Ventura Blvd, Sherman Oaks, CA 91403 Sales Price $3,775,000 BLDG SF 5,100 Price/SF (BLDG) $740.20 Land SF 9,583 Price SF/Land $393.92 Cap Rate 1.25% Zoning LAC4 Close of Escrow 11/07/2017

ENCINO MEDICAL TOWER RENT COMPARABLES | PRICE / SF / MONTH 1 R. J Plaza $2.95 2 17337 Ventura Blvd $2.85 ENCINO $3.00 3 17609 Ventura Blvd 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 $2.55 $2.50 4 Encino Medical Tower $2.37 $2.35 $2.35 $2.35 $2.25 5 Woodcourt Bld 1 $2.50 $2.25 $2.25 6 $2.15 6 Topanga Financial Center $2.00 $2.00 11 5 7 18075 Ventura Blvd $2.00 7 4 9 10 8 17525 Ventura Blvd 3 13 12 8 2 9 17815 Ventura Blvd 10 17801 Ventura Blvd $1.50 1 11 Tarzana Executive 12 17404 Ventura Blvd $1.00 13 Encino Office Plaza

$0.50

$0.00 R. J Plaza 17337 17609 Radius Court Woodcourt Topanga 18075 17525 17815 17801 Tarzana 17404 Encino Office Average Ventura Blvd Ventura Blvd Bld 1 Financial Ventura Blvd Ventura Blvd Ventura Blvd Ventura Blvd Executive Ventura Blvd Plaza Center

ADDRESS RENTABLE SF SF LEASED RENT/SF/YEAR RENT/SF/MONTH LEASE TYPE YEAR BUILT # ADDRESS RENTABLE SF SF LEASED RENT/SF/YEAR RENT/SF/MONTH LEASE TYPE YEAR BUILT # R. J Plaza 17801 Ventura Blvd 10 9,700 7,000 $27.00 $2.25 Modified Gross 1977 1 14144 Ventura Blvd 48,251 1,953 $35.40 $2.95 Full Services 1983 Encino, CA 91316 Sherman Oaks, CA 91423 Tarzana Executive 17337 Ventura Blvd 11 2 48,000 5,115 $27.00 $2.25 Full Services 1976 18425 Burbank Blvd 94,571 3,870 $25.80 $2.15 Full Service 1982 Encino, CA 91316 Tarzana, CA 91356

17404 Ventura Blvd 17609 Ventura Blvd 12 3 43,000 4,700 $28.20 $2.35 Full Services 1980 14,767 3,580 $34.20 $2.85 Full Service 1985 Encino, CA 91316 Encino, CA 91316

Encino Medical Tower Encino Office Plaza 13 4 17835 Ventura Blvd 45,308 860 $30.60 $2.55 Full Services 1972 17555 Ventura Blvd 32,916 1,618 $24.00 $2.00 Full Service 1999 Encino, CA 91316 Encino, CA 91316 Woodcourt Bld 1 Average 39,175 2,935 $28.43 $2.37 5 20301 Ventura Blvd 42,082 860 $28.20 $2.35 Full Services 1980 Woodland Hills, CA 91364 Topanga Financial Center 6 5855 Topanga Canyon Blvd 50,000 3,855 $27.00 $2.25 Full Services 1980 Woodland Hills, CA 91367

18075 Ventura Blvd 7 10,857 300 $30.00 $2.50 Full Services 1965 Encino, CA 91316

17525 Ventura Blvd 8 38,632 1,350 $28.20 $2.35 Full Services 1980 Encino, CA 91316 $28.43 $2.37 17815 Ventura Blvd 9 31,192 3,100 $24.00 $2.00 Modified Gross 1980 Encino, CA 91316 AVG RENT SF AVG RENT SF YEAR MONTH

ENCINO MEDICAL TOWER RENT COMPARABLES | PRICE / SF / MONTH $4.95 1 Encino Woods $5.00 2 The Ventana $4.50 $4.00 3 Tarzana Executive $3.95 4 Tarzana Medical Center $4.00 $3.50 ENCINO $3.50 $3.44 5 Encino Medical Tower 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 $3.25 $3.25 $3.25 $3.50 $3.15 $3.15 $3.20 $3.00 6 Rimal Medical Building $3.00 $3.00

10 3 7 15840 Ventura Blvd $3.00 6 4 14 13 8 Encino Professional Building $2.50 2 9 The Almar Bldg 1 10 Wilbur Medical Plaza $2.00 12 11 Encino Arches 8 $1.50 5 9 7 11 12 West Valley Medical Center 13 Tarzana Medical Atrium $1.00 14 Tarzana Medical Plaza $0.50

$0.00 Encino Woods The Ventana Tarzana Tarzana Encino Medical Rimal Medical 15840 Ventura Encino The Almar Bldg Wilbur Medical Encino Arches West Valley Tarzana Tarzana Average Executive Medical Center Tower Building Blvd Professional Plaza Medical Center Medical Medical Plaza Building Atrium

# ADDRESS RENTABLE SF SF LEASED RENT/SF/YEAR RENT/SF/MONTH LEASE TYPE YEAR BUILT # ADDRESS RENTABLE SF SF LEASED RENT/SF/YEAR RENT/SF/MONTH LEASE TYPE YEAR BUILT Encino Woods Wilbur Medical Plaza 1 17525 Ventura Blvd 38,632 1,939 $39.00 $3.25 Full Service 1980 10 5620 Wilbur Ave 52,889 4,800 $37.80 $3.15 Full Service 1986 Encino, CA 91316 Tarzana, CA 91356 The Ventana Encino Arches 2 18131 Ventura Blvd 117,978 30,694 $47.40 $3.95 Modified Gross 2017 11 15503 Ventura Blvd 76,652 15,505 $38.40 $3.20 Full Service 1990 Tarzana, CA 91356 Encino, CA 91436 Tarzana Executive West Valley Medical Center 3 18425 Burbank Blvd 94,571 1,353 $36.00 $3.00 Full Service 1982 12 5353-5363 Balboa Blvd 103,008 1,065 $36.00 $3.00 Full Service 1986 Tarzana, CA 91356 Encino, CA 91316 Tarzana Medical Center Tarzana Medical Atrium 4 18740 Ventura Blvd 27,190 1,258 $36.00 $3.00 Full Service 1962 13 5411 Etiwanda Ave 89,158 12,569 $59.40 $4.95 Modified Gross 2019 Tarzana, CA 91356 Tarzana, CA 91356 Encino Medical Tower Tarzana Medical Plaza 5 16260 Ventura Blvd 60,529 5,948 $39.00 $3.25 Full Service 1977 14 5525 Etiwanda Ave 67,933 1,975 $48.00 $4.00 Full Service 1986 Encino, CA 91436 Tarzana, CA 91356 Rimal Medical Building Average 68,959 6,159 $41.27 $3.44 6 18840-18850 Ventura Blvd 24,959 1,525 $42.00 $3.50 Full Service 1974 Tarzana, CA 91356

15840 Ventura Blvd 7 33,000 832 $42.00 $3.50 Full Service 1966 Encino, CA 91436

Encino Professional Building 8 16500 Ventura Blvd 28,545 1,408 $39.00 $3.25 Full Service 1985 Encino, CA 91436 The Almar Bldg 9 16030 Ventura Blvd 150,386 5,350 $37.80 $3.15 Full Service 1983 $41.27 $3.44 Encino, CA 91436 AVG RENT SF AVG RENT SF YEAR MONTH

44 ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP ENCINO MEDICAL TOWER | OFFERING MEMORANDUM | THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 45 AREA OVERVIEW SAN FERNANDO VALLEY SAN FERNANDO VALLEY HIGHLIGHTS ▶ 2.5 million residents in the San Fernando Valley

▶ Population growth projected – 45,000 new residents by 2019 Almost 2.5 million people reside in the San Fernando Valley, which ▶ Strong ties to the entertainment industry – Home of Walt Disney Company, includes the sub-markets of Northridge-Northwest San Fernando Universal Studios, Warner Brothers, DreamWorks and Paramount Ranch Valley; Van Nuys-Northeast San Fernando Valley; Woodland Hills; Burbank-Glendale-Pasadena; as well as Sherman Oaks-North ▶ Local motion picture and entertainment companies employ roughly 25,000 Hollywood-Encino. The area’s population is expected to increase by people 1.9 percent through 2019, or by nearly 45,000 new residents. ▶ Aerospace (Boeing & Northrop Grumman) Insurance (21st Century Insurance) and Healthcare (Kaiser Permanente and Providence Health & Services) Known for its entertainment industry, the Valley boasts more than 100 industries also generate numerous well-paying jobs soundstages. Entertainment giants calling the Valley home include ▶ Substantial income growth since 2000 Walt Disney Co., Universal Studios, Warner Brothers, DreamWorks and Paramount Ranch. The entertainment industry continues to set ▶ Home ownership rate near 50% and large rental base the area’s economic pulse. Local motion-picture and entertainment companies employ roughly 25,000 people. SAN FERNANDO VALLEY MAJOR EMPLOYERS While the Valley has grown into the world’s center for entertainment, aerospace giants Boeing and Northrop Grumman, and 21st Century Insurance also generate numerous well-paying jobs.

Healthcare is a also a major source of employment with providers that include Kaiser Permanente, and Providence Health & Services. As a result of its large concentration of high-salaries and successful companies, the area’s median household income of $59,300 per year has risen dramatically since 2000.

THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 49 ENCINO, CALIFORNIA RECREATION Encino offers multiple amenities to its residents and those in the surrounding area. The city is Balboa Golf Course Encino, California is one of the strongest and most affluent submarkets in all of home to three 18 hole Municipal golf courses, Woodley Lakes Golf Course, Encino Golf Course Los Angeles County. Encino boasts strong high -end demographics with a large and Balboa Golf Course. number of households showing incomes north of $125,000. Homes south of Ventura Boulevard in Encino are considered to be among the most expensive in Los The Sepulveda Basin Wildlife Reserve is a haven for wildlife and humans alike, a welcome oasis Angeles County. They range from 2-50 million dollars and are home to numerous within an urban setting of Van Nuys and Encino. The U.S. Army Corps of Engineers channelized celebrities, executives, athletes, and entertainers. The local economy provides jobs the Los Angeles River and built the Sepulveda Dam to capture and hold floodwaters for later primarily in health care, social services, and professional services. Encino is the gradual release down the river. Except for infrequent flood episodes, this otherwise dry-land home to 3,800 businesses employing about 27,000 people at an annual payroll of flood control basin leased to the City of Los Angeles Department of Recreation & Parks plays $1.4 billion. host to diverse uses including athletic fields, agriculture, golf courses, a fishing lake, park lands, a sewage treatment facility and a growing wildlife reserve. Encino is situated in the central portion of the southern San Fernando Valley and on the north slope of the Santa Monica Mountains. It is flanked on the north by Reseda The Balboa Sports Complex run by the Department of Recreation & Parks has a gym capacity of and the Sepulveda Basin, on the east by Sherman Oaks, on the southeast by Bel- 400, lighted baseball diamond, basketball courts, football field, handball courts, tennis courts, Air, on the south by Brentwood and on the west by Tarzana. Ventura Boulevard, the volleyball courts, children’s play area, unlighted soccer field, indoor gym and community room. primary east-west thoroughfare through the San Fernando Valley, runs directly through Encino. It is the world’s longest avenue of contiguous businesses at 18 miles long. Previously, Ventura Boulevard was the most concentrated location of PUBLIC TRANSITView of Encino mom-and-pop shops in the Valley. Nowadays, it has housing, mini-shopping centers, restaurants, coffee shops, nightlife, office buildings, hospitals, supermarkets, and more. THE EPICENTER OF SAN FERNANDO VALLEY ▶ Affluent neighborhood – High percentage of households with incomes above $92,318 ▶ Ideally situated in the central portion of the southern San Fernando Valley and on the north slope of the Santa Monica Mountains METRO ORANGE LINE ▶ Significant population growth over the last six years ▶ Encino is one of the most desirable and affluent areas in Los Angeles and is a favored Encino Office Center is situated near the Balboa Orange Line Bus Stop. The Orange Line is a bus rapid transit line in the Metro Liner residential location for business and community leaders, entertainment celebrities network. It operates between Chatsworth or Warner Center (trips and high net worth families alternate between the two western terminals) and the North Hollywood Metro Station in the San Fernando Valley, where it ▶ 46.8% of Encino residents 25 and older have earned a four-year degree connects with the Metro Red Line for Downtown Los Angeles. ▶ Central West SFV location offers close proximity to major freeways, airports, DTLA, The 18-mile Orange Line uses a dedicated, exclusive right-of-way Tri-Cities, Westside and the Warner Center with stations located at one-mile intervals. The Metro Orange Line bicycle path runs alongside part of the route.

THE BRANDON MICHAELS GROUP | MARCUS & MILLICHAP 51 DEMOGRAPHICS POPULATION 1 MILE 3 MILES 5 MILES

2019 Total Estimated Population 28,628 145,563 458,447

28,628 12,575 53,844 163,428 Total Population of Encino, CA 2019 Total Estimated Households Avg Household Size 2.20 2.60 2.70 $103,712 163,428 49% 51% 2019 Average Household Income $95,074 $103,712 $92,318 Average HH income within 3-m radiusHouseholds within a 5-m radius EDUCATION MALE FEMALE HOUSE HOLDS

2018 Owner Occupied Housing Units 6,268 29,818 75,175

2018 Renter Occupied Housing Units 6,306 24,026 88,253

2018 HOUSEHOLDS BY HOUSEHOLD INCOME <$25,000 2,386 9,833 33,084 458,447 75,175 45.2% 27% 21.9% 6.6% $25,000 - $50,000 1,769 8,617 31,836 Population within 5-m radius Owner Occupied Households High School Graduate Associates Graduate Bachelor’s Graduate Graduate Degree within 5-m radius $50,000 - $75,000 2,879 9,050 26,530

$75,000 - $100,000 1,144 5,701 18,588

$100,000 - $125,000 1,388 5,850 15,506

POINTS OF INTEREST $125,000 - $150,000 666 3,359 9,929 • ◆ Woodley Lakes Golf Course • ◆ The Museum of San Fernando Valley • ◆ The Oaks Overlook $150,000 - $200,000 1,173 4,485 12,009 • ◆ Encino Golf Course • ◆ Valley Relics Museum • ◆ SwingIt Trapeze • ◆ Balboa Sports Complex • ◆ William S Hart Museum • ◆ Nethercutt Collection $68,622 88,253 $200,000+ 1,169 6,948 15,945 • ◆ The Sepulveda Basin Wild Reserve • ◆ Colonia Gymnasium Median HH income within Renter Occupied Households 5-m radius within 5-m radius BRANDON MICHAELS TEAM MEMBERS Senior Managing Director of Investments Sean Brandt Ben Brownstein Senior Director, National Retail Group Nicole Cottrell ENCINO Tel: (818) 212-2794 Dana Liu [email protected] Lauren Sackler 17835MEDICAL VENTURA BOULEVARD TOWERENCINO, CA 91316 License: CA #01434685 Steven Schechter Austin Sreden