OFFERING MEMORANDUM WALGR EENS

1125 RIDGE ROAD WEBSTER, NY 14580

Actual Site NON - ENDORSEMENT AND DISCLAIMER NOTICE

Confidentiality and Disclaimer

The information contained in the follow ing Marketing Brochure is proprietary and strictly confidential. It is intended to be review ed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, 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, w ith 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 compliance w ith 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; how ever, 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 w arranty 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.

Non-Endorsement Notice Marcus & Millichap is not affiliated w ith, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation's logo or name is not intended to indicate or imply affiliation w ith, 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. Webster, NY PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS. ACTIVITY ID: ZAB0370069 Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows:

The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided.

As the Buyer of a net leased property, it is the Buyer’s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer.

Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors.

Buyer and Buyer’s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs.

Like all real estate investments, this investment carries significant risks. Buyer and Buyer’s legal and financial advisors must request and carefully review all legal and financial documents related to the property and tenant. While the tenant’s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant’s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer’s legal ability to make alternate use of the property.

By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property. WALGREENS

INVESTMENT HIGHLIGHTS ► Over Thirteen Years Remaining on Absolute-Net Lease ► Strategically Located Within A Major Retail Trade Area Zero Landlord Responsibilities Located Across from T.J.Maxx, L.A. Fitness, Target, Old Navy, Kohl’s, Hobby Lobby, Chase Bank, Michaels, and Many More ► Investment Grade Credit | S&P Rating: BBB- Largest Drug Retailer in the United States with Over 8,100+ ► Strategically Located Adjacent to NY-104 locations and a Market Cap of $86 Billion NY-104 has a Traffic Count of 48,280 VPD that Runs East/West and the Main Thoroughfare to Neighboring Cities Such as Rochester ► Built-To-Suit Store with Drive-Thru Pharmacy Window Only Walgreens Within a 7-Mile Radius ► Proven Location Despite Recent Acquisition This Location Survived the Store Closures Once Walgreens Acquired Many ► Great Visibility and Exposure from Signalized Intersection of Rite Aid Locations; further proof to their commitment to this location Two Points of Ingress & Egress with a Traffic Count of 39,000 VPD

INVESTMENT OVERVIEW Marcus & Millichap is proud to present a 14,820-square foot Walgreens located in Webster, NY. The property was built in 2008 as a build-to-suit for Walgreens, featuring a drive thru pharmacy window. The property benefits from its ample available parking of 72 parking stalls and signalized intersection location, providing easy access through its two points of ingress and egress. Walgreens is operating under a 75-year absolute-net lease with the option to terminate their lease after the 25th year and every month thereafter through June 30, 2083. There are currently over thirteen years remaining on its initial base term before Walgreens can exercise their first termination right. There are also no rent increase and options available.

The property is located immediately three blocks south of the Irondequoit-Wayne County Expressway ramp at the signalized intersection of Ridge Road and Holt Road, which generates a combined traffic count of 28,090 vehicles per day. The Property sits kitty corner from a major retail trade area with anchoring tenants such as Target, Dick’s Sporting Good, T.J.Maxx, Ulta Beauty, PetSmart, Kohl’s, and L.A. Fitness. Other neighboring retailers include Hobby Lobby, Chase, Panera Bread, Barnes & Noble, and many more. In addition, Walgreens is conveniently located within a one-mile radius to over nine different health clinics, nursing homes, and dentistry’s.

A new investor has the opportunity to acquire a corporate guaranteed (S&P BBB-) net-leased property with zero landlord responsibilities. Given the Subject Property’s strategic location within the community and their long-term tenancy, an investor can feel confident in acquiring a net-lease investment with peace of-mind for years to come. With competitive debt available in today's marketplace, a new investor has the ability to leverage debt and maximize cash flow or structure a long-term loan for estate planning purposes. In addition, an investor can take advantage of this fee simple ownership and benefit from the depreciation of the real estate, further providing significant and favorable after-tax savings. PROPERTY DETAILS

THE OFFERING LEASE SUMMARY

Property Name Walgreens Property Subtype Net Leased Drug Store

1125 Ridge Road Tenant Walgreens Co. Property Address Webster, NY 14580 Rent Increases None Price $5,752,200 Guarantor Corporate Guarantee Capitalization Rate 5.65% Lease Type Absolute-Net Price/SF $388.14 Lease Commencement 05/01/2008 PROPERT Y DESCRIPTION Lease Expiration 06/30/2033 Year Built 2006

Gross Leasable Area 14,820-SF Lease Term 25 Years

Zoning Commercial Remaining Lease Term - As of Jan-2020 13.5 Years

Type of Ownership Fee Simple Option To Terminate Every 6-months after 06/30/2033 Lot Size 2.60 Acres Landlord Responsibility None - Zero Landlord Responsibilities Parking Spots | Parking Ratio 72 Stalls | 4.85/1,000 Tenant Responsibility Maintenance and Replacement of Entire Property Parking Asphalt

Right of First Refusal Tenant has Twenty (20) Days to respond to Bona Fide Offer

LEASE SUMMARY PROPOSED FINANCING

ANNUAL MONTHLY Loan Amount $3,623,886 YEAR RENT/SF CAP RATE RENT RENT Loan Type New Loan Current $325,000 $27,083 $21.93 5.65% Loan-to-Value 63% Options 1 through 50 $325,000 $27,083 $21.93 5.65% Down Payment 37% | $2,128,314

Interest Rate 3.82% Fixed

Loan Term / Amortization 10 Years | 30 Years

Annual Debt Service $203,125

Debt Service Coverage 1.60x

Net Cash Flow After Debt Service / Cash-on-Cash Return $121,875 / 5.73%

* Please contact Marcus & Millichap Capital Corp. for a tailored loan quote. Financing also available for 25-Year amortization, various debt leverages, and 5-Year or 7-Year fixed rates AlternativeAlternative InvestmentsInvestments

BOR: Steven Weinstock BOR: J.D. Parker IL Lic. # 471.011175 CT Lic. # REB.0788985 Walgreens Walgreens Plainfield, IL (Chicago MSA) Torrington, CT $6,059,322 $5,320,116 12+ Years Remaining 13+ Years Remaining

The above properties are also available by Seller. Either properties can be purchased all-together or individually. Please contact listing agent for additional information. 1 TENANT OVERVIEW WALGREENS Originally founded in Chicago in 1901, Walgreens Alliance has grown today to become the nation’s second largest drugstore retailer in term of revenue. The company’s retail locations are engaged in the sale of prescription and non- prescription drugs and carry additional product lines, such as: general merchandise, cosmetics, toiletries, liquor and beverage, and tobacco.

Walgreens Boots Alliance is ranked #19 on the Fortune 500 and is rated “BBB” by Standard and Poor’s, giving investors superior financial stability. During FYE 2017, the company generated over $118,000 billion in revenue and produced net earnings of $4.1 billion. believes in quality over quantity, home- spun growth rather than growth through acquisition, and builds rather than buys stores so that the company can pick only the best store locations. As of FYE 2017, Walgreens Boots Alliance operated 12,822 stores across the globe, including nine different counties.

In April 2010, the company acquired -based drug store chain from affiliates of Oak Hill Capital Partners for a total enterprise value of $1.1 billion in cash. The acquisition included 257 drug stores and two distribution centers providing the company with the leading market share position in New York City. In 2013, the company acquired 76 stores from North Carolina drug store chain Kerr Drug. Kerr Drug annual sales were $380 million.

In 2012, Walgreens launched the Balance Rewards loyalty program with 85 million active members, making Balance Rewards one of the most successful launches of a loyalty program in the history of retail. Also in June 2012, the company merged with , for $6.7 billion to create of the world’s largest drugstore and pharmacy retailers.

In late 2014, Walgreens acquired the remainder of Alliance Boots stocks for $15.3 billion. The company remains headquartered in Deerfield, Illinois. Walgreens recently acquired 1,932 Rite Aid stores for approximately $4.4 billion in cash, adding to their global network of retail pharmacy locations. WALGREENS

PROPERTY PHOTOS WALGREENS LOCAL MAP WALGREENS REGIONAL MAP

Lake Ontario

8 Miles From Rochester WALGREENS LOCATION OVERVIEW

ABOUT WEBSTER, NEW YORK

Webster is a town in the northeast corner of Monroe County, New York, United States. Webster is a great place to live and raise a family. The median income is more than $51,000, and property taxes are reasonable. People are attracted to Webster's suburban and rural setting located just a few miles away from New York’s third largest city. Housing ranges from lakefront and bay estates to affordable starter homes, patio homes, modest to luxury apartments, and specialized communities for senior citizens.

The story of Webster began on July 25, 1937 when orator and stateman named Daniel Webster spoke to a large gathering of Whigs on the Rochester courthouse steps concerning currency regulation and the state of the economy. The Rochester Democrat editorialized that he was "the cleverest fellow in the world for embellishing a story." The Whig farmers from North Penfield, who were part of Daniel Webster's audience that day, were so impressed by his eloquence that, when they petitioned the state legislature for separate town status from Penfield, they chose to name it in his honor and gaining the town's motto, "Where Life Is Worth Living." On February 6, 1840, Governor William Seward announced the birth of Webster, New York. Originally part of North Penfield, land was split off to create the new town. Source: www.ci.webster.ny.us/

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2018 Marcus & Millichap 29 WALGREENS

PRICINGPRICING ANDANDLOCATION VALUATIONVALUATIONTENANTMARKETINGDEMOGRAPHICSDEMOGRAPHICS SUMMARYOVERVIEW MATRIXMATRIX TEAM

Lake Ontario CREATED ON JANUARY 2020

1 Miles 3 Miles 5 Miles POPULATION 2023 Projection 7,468 42,175 76,483 2018 Estimate 7,141 39,400 72,419 2010 Census 6,885 37,282 69,668 2000 Census 6,147 31,832 61,906

INCOME Average $69,046 $95,557 $101,608 Median $52,860 $74,277 $78,119 Per Capita $35,175 $37,999 $40,121

HOUSEHOLDS 2023 Projection 3,855 16,850 30,343 2018 Estimate 3,627 15,636 28,509 1-Mile 2010 Census 3,508 14,826 27,456 2000 Census 3,009 12,297 23,613

HOUSING 2018 $148,440 $179,705 $181,201 3-Miles EMPLOYMENT 2018 Daytime 12,169 37,951 60,595 Population 2018 4.30% 3.80% 3.60% Unemployment 2018 Median Time 23 22 22 Traveled

5-Miles RACE & ETHNICITY White 88.07% 90.83% 91.89% Native American 0.02% 0.03% 0.03% African American 2.60% 2.52% 2.34% Asian/Pacific 6.10% 3.73% 3.21% Islander Source: © 2015 Experian WALGREENSWALGREENS

ROCHESTER OVERVIEW The Rochester MSA is the third largest economy & the second wealthiest region in all of NYS after the MYC MSA. Rochester’s economy benefits from a central location among the population centers of the Northeastern U.S., METRO and the innovative foundations set by such firms as , and HIGHLIGHTS Bausch and Lomb. The metro’s post-secondary schools produce an The University of Rochester is one of the country's top-tier research educated workforce and generate cutting-edge research that drives the universities with more than 28,000 employees and some 10,000 students. city’s innovation and technology sectors. The metro is composed of six DIVERSIFYING ECONOMY counties: Monroe, Orleans, Wayne, Ontario, Livingston and Yates. Growing industries include food-and-beverage manufacturing, biotechnology and green innovation. HEALTH CENTER Located in New York between Buffalo and Syracuse, Rochester Regional Health employs approximately 16,000 workers and includes five hospitals. ECONOMY

. Food Markets is the third largest local employer following Rochester University and Rochester Regional Health. The expanding supermarket chain has 92 stores on the East Coast. . Founded in Rochester, Xerox Corp. houses roughly 3,400 employees in Monroe County. Its office is located on a 600-acre campus in Webster. . Located in Penfield within Monroe County, Paychex, Inc. is a business-process company with thousands of employees within the region. It serves more than half a million small to medium-size businesses nationwide. DEMOGRAPHICS

2018 2018 2018 2018 MEDIAN POPULATION: HOUSEHOLDS: MEDIAN AGE: HOUSEHOLD INCOME: 1.1M 435K 40.0 $56,200 Growth Growth U.S. Median: U.S. Median: 2018-2023*: 2018-2023*: 1.7% 2.7% 38.0 $58,800

* Forecast Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s Analytics; U.S. Census Bureau

1 PR ESENTED BY : BROKER OF RECORD: JOHN KRUEGER LICENSE #: 10311205789 - MANHATTAN

MARCUS & MILLICHAP

260 MADISON AVE, 5TH FLOOR

NEW YORK, NY 10016

PHONE: (212) 430-5100

EMAIL: [email protected]