FEBRUARY 2020

EXECUTIVE SUMMARY 2

The opportunity exists to acquire a market-leading office asset in a premier, amenity rich location for approximately 50% of replacement cost (est. $400 PSF) The Opportunity

Newmark Knight Frank (NKF), as exclusive advisor, is pleased to present the opportunity to acquire the fee-simple interest in Paradise Village Office Property Highlights Financial Summary Park (the Property), a 268,516-square-foot, newly renovated office building located in the affluent and amenity-rich Paradise Valley/North Phoenix 87.5% 268,516 10%+ 50% CASH-ON-CASH OF REPLACEMENT submarket in Phoenix, . Currently 87.5% leased, Paradise Village LEASED TOTAL SQUARE FEET Office Park is comprised of one, five-level office building and a subterranean (YEAR 1) COST parking structure offering an above-market structured and surface parking ▼ ratio of 5.0/1,000 RSF. The Property’s unique architectural design, extensive 5 11% 7%+ 9%+ on-site amenity options, and flexible floor plans allow for a highly functional STORIES IN-PLACE RENTS CAP RATE CAP RATE and attractive office environment that caters to small and large tenants alike. BELOW MARKET (IN-PLACE) (MARK-TO-MARKET)

The Paradise Valley/North Phoenix submarket offers tenants an abundant selection of nearby amenities and premier access to multiple freeway 5.0/1,000 RSF Mid/High Teens systems and major thoroughfares. The Property is within a five-minute drive PARKING RATIO (SURFACE & STRUCTURE) LEVERED IRR to AZ State Route 51 Freeway, a short drive to AZ State Route 101 Loop Freeway, and is proximate to major arterial streets, all of which combine to provide unrivaled access to a large, diverse labor pool. Additionally, the submarket benefits from a host of surrounding amenities, including , hotels/resorts and a 15-minute drive to Phoenix Sky Harbor Airport. 3 Highly functional and attractive office environment that caters to small and large tenants alike. Investment Highlights Ultra Affluent Paradise Valley Demographics 10%+ Cash-on-Cash Yields + Value-Add Returns • Currently 87.5% leased, Paradise Village Office Park provides investors with a strong, predictable cash flow stream generating immediatedouble digit cash-on-cash $1.5M 74% returns (10%+) MEDIAN HOME VALUE BACHELOR’S DEGREE OR HIGHER (2X THE MSA AVERAGE) • Lease-up of existing vacancy and marking-to-market of in-place rents (11%+ below market) provides additional upside and the opportunity to realize value-add returns $204,000 • Diversified and committed rent roll withno tenant taking up more than 8% of the net MEDIAN HOUSEHOLD INCOME rentable area (330% HIGHER THAN THE PHOENIX MSA) • Committed tenant roster with 19.4% (52,126 SF) having expanded and 34.5% (92,873 SF) that have exercised their renewal options CLOSE TO PARADISE VALLEY COUNTRY CLUB • Opportunity to acquire for 50% discount to replacement cost (est. $400 PSF)

HOME TO CORPORATE EXECUTIVES Institutional-Quality Office with Recently Completed AND DECISION MAKERS: Capital Improvement Plan • Originally constructed as the corporate headquarters location for PETER SPERLING developer , the Property has been institutionally owned and managed since its Chairman, Apollo Group completion in 1986 DOUG DUCEY • Current ownership has invested more than $8 million in capital improvements since Governor of Arizona 2015 to thoroughly modernize the Property: » Premium spec suites BRUCE HALLE New tenant lounge, fitness center & conference facilities Founder/Chairman, Discount Tire » » Restroom and corridor renovations DAN QUAYLE » Atrium remodel with collaboration spaces Former U.S. Vice President » Upgraded mechanical systems • Flexible floorplates providing various options for large, mid size and smaller tenants • Ideal location on Tatum Boulevard, one of the major north-south thoroughfares in the Phoenix MSA • Highly accessible building with above-average secured garage and surface parking, 24/7 security and on-site property management 4

Paradise Valley is the wealthiest municipality in Arizona, best known for its luxury resorts, golf courses, shopping, real estate and restaurant scene.

Positive Submarket Fundamentals and Highly Affluent 3,500 Businesses and Location in Phoenix MSA 28,000+ employees • The North Phoenix/Paradise Valley submarket is well-positioned, compared to competitive submarkets, as net absorption has outpaced a nominal amount within a 3-mile radius of construction throughout the last few years, keeping vacancy below the historical average • Within a three-mile radius of Paradise Village Office Park, there are more than 84,000 residents with average household incomes exceeding $109,000 • North Phoenix/Paradise Valley is home to major employers such as Mayo Clinic (4,700 employees), American Express (2,700 employees), Charles Schwab (2,100 employees), Sprouts (400 Employees) and Marriott (1,250 employees) • The Property is being offered at pricing equal to 50% of both replacement cost and peak asset valuation (approximately $400 PSF) Positive Office Market Fundamentals Poised for Additional Growth • In the last 60 months, officerents in the North Phoenix/Paradise Valley submarket have increased 24.2% from $25.33 to $31.45 PSF • Paradise Village Office Park is well positioned within the competitive set, offering tenants more on-site amenities, a Main and Main location, a true Class A environment and attractive rents In the last 24 Months, asking rent at Paradise • The North Phoenix/Paradise Valley submarket has averaged 94,088 SF of Village Office Park has increased21% annual net absorption from 2010 to 2019 (from $23.50 PSF to current $28.50 PSF) • Officevacancy has decreased 24.0% from the 2009 peak of 38.0% to 10.2% in 2019, while still having historical runway for additional tightening to the 2006 low of 8.7% 5

Abundant Walkable Amenities • Adjacent to the Paradise Valley Mall, one of the Valley’s largest regional malls at 1.2 MSF and home to more than 130 stores offering a variety of shopping, dining and entertainment options • Within three miles of Paradise Village Office Park areover 4 MSF of retail, including 29 sit-down and fast casual restaurants as well as numerous retail amenities such as , Target, , LA Fitness, Starbucks, Sprouts, CVS and many others • Several of the Valley’s top resort hotels are within a short drive of the Property, including the Omni Scottsdale, Fairmont Scottsdale Princess Resort, The Gainey Ranch Hyatt Regency, Westin Kierland, JW Marriott at Desert Ridge and the JW Marriott Scottsdale Camelback Inn EXPANSION SUMMARY (2018–2019 YTD) Tenant Expansion SF Total SF

374 1,374

731 4,526

2,527 7,301

3,103 3,619

3,749 8,518

343 1,829

2,043 10,872

882 1,906

2,365 3,619

1,254 3,633

15,006 44,832 6

Situated in the heart of the Paradise Village shopping district, the Property sits adjacent to 2.3 MSF of walkable retail and dining amenities.

Cactus Rd

Tatum Blvd

Paradise Village Pkwy 7

Best-in-State Demographics WITHIN THREE-MILE RADIUS 84,582 POPULATION

$109,000+ AVERAGE HOUSEHOLD INCOME

$453,408 AVERAGE HOME VALUE

4,847 MULTIFAMILY UNITS

3,465 NUMBER OF BUSINESSES

28,428 NUMBER OF EMPLOYEES INVESTMENT CONTACTS LEASING ADVISOR

CJ OSBRINK KEVIN SHANNON RICK STUMM SEAN SPELLMAN Executive Managing Director Co-Head, U.S. Capital Markets Senior Managing Director Senior Vice President 602.952.3841 310.491.2005 310.491.2013 602.735.5555 [email protected] [email protected] [email protected] [email protected] AZ RE Lic. #BR672532000 CA RE Lic. #00836549 CA RE Lic. #01844822 AZ RE Lic. #SA624855000

BRUNSON HOWARD KEN WHITE PAUL JONES Executive Managing Director Executive Managing Director Executive Managing Director 858.875.3610 310.491.2006 949.608.2083 [email protected] [email protected] [email protected] CA RE Lic. #01793925 CA RE Lic. #01788506 CA RE Lic. #01380218

FINANCING CONTACTS

DAVID MILESTONE BRETT GREEN Vice Chairman Senior Managing Director 310.491.2015 310.491.2009 [email protected] [email protected] CA RE Lic. #01515842 CA RE Lic. #01892016

CORPORATE LICENSE #01355491 FEBRUARY 2020

The information contained herein has been obtained from sources deemed reliable but has not been verified and no guarantee, warranty or representation, either express or implied, is made with respect to such information. Terms of sale or lease and availability are subject to change or withdrawal without notice.