MIDTOWN CENTER 1000 W 6TH ST PUEBLO, CO 81003 Exclusively Listed By

Home , Bessemer (Pueblo), Pueblo Zoo, Steelworks Museum

OFFERING MEMORANDUM

MIDTOWN CENTER 1000 W 6TH ST PUEBLO, CO 81003 exclusively listed by:

kyle matthews BROKER OF RECORD

colorado@matthews.com DIR (214) 692-2211 MOB (520) 820-3084 LIC # ER.100070690 CONTENTs 4 Executive summary FINANCIAL SUMMARY INVESTMENT HIGHLIGHTS

6 property overview PROPERTY DESCRIPTION PARCEL MAP SITE PLAN REGIONAL/LOCAL MAP TENANT MAP 10 area overview PUEBLO, COLORADO OVERVIEW COMMUNITY DEVELOPMENT LOCAL ATTRACTIONS COLORADO SPRINGS

14 financial overview RENT ROLL INCOME AND EXPENSES RECENT LEASES

20 tenant overview EXPRESS SCRIPTS US POSTAL 04 Executive summary investment highlights • Offered at an attractive 9.85% return on in-place net income • Attractive financing could achieve a cash on cash return of over 15%. • Low Vacancy – Center is over 97% occupied • ABC Bank and the DMV are separately parceled allowing for the opportunity to sell these Financial summary individually • 4 Acres of Raw Land Included – Restaurant and Storage companies have expressed interest in ground leases or build to suit development Price $9,500,000 Tenants: Property Size (NRA) 208,893 • National Investment Grade Credit Anchor – Express Scripts holds a BBB credit as rated by Year Built/ Renovated 1986 S&P and currently is paying a significantly below market rent of only $3.50/SF Current Occupancy 97.5% • Express Scripts occupies 35% of the GLA and invested in a large Tenant Improvement package of close to $3 Million in exchange for a lower rent from the landlord. Additionally, Major Tenants the City of Pueblo provided an incentives package valued at an estimated $7 Million Express Scripts 75,000 • Express Scripts is one of the largest employers with over 600 employees at this location Pinelles Bowling Alley 34,714 which results in an estimated payroll of $12 Million. – City of Pueblo is heavily invested in Bourbon Room 13,975 retaining this employer Apria Home HealthCare 11,968 • Apria Home Health Care was acquired for $1.6 Billion in 2008 by Blackstone Partners LP Youth and Family Academy 10,000 which is the largest private equity company in the world DMV 8,350 • Long Term Tenants – Over 70% of the tenants have been operating at this location for over Year 1 Operating Data (DCF) 10 Years Effective Gross Income $1,434,833 • Diversified Income Stream from ±30 different tenants including restaurants, a post office, Operating Expenses $499,531 DMV, auto service operator, bank, health care, fitness center, bowling alley, and local strip tenants • Low Rents – A majority of, the tenants are currently paying rents are within or below market rent

Property Information: • Stabilized +200,000 SF Community Center Priced Below Replacement Cost • 6 Buildings on 11 Parcels for a total of +/- 35 Acres of land • Located in the center of town on highly trafficked 4th Street which sees over 30,000 ADT • Almost $2 Million in renovations and tenant improvements in past 10 years including new roofing, new HVAC units, new parking lot lighting, parking lot resurfacing and restriping Midtown center, pueblo, co | 5 PARCEL MAP

property description 1 2

THE OFFERING Property Name ...... Midtown Center Property Address...... 1000 W 6th Street, 4 Pueblo, CO 81003 Assessor’s Parcel Number ��536238001, 536240002, 536203015, 536200033, 3 5 6 7 536200011, 536240001, property overview property 536200010, 536200052, 11 10 9 536205001,536205015, 8 536239001 Zoning ��B4

SITE DESCRIPTION APN Number of Stories ��One 1 536200052 Year Built/Renovated �� 1959/1986 2 536240001 Rentable Square Feet ��208,893 SF 3 536240002 Lot Size...... ±35 Acres (1,524,600 SF) 4 536200010 Type of Ownership ��Fee Simple 5 536200011 Parking...... ±1,200 SF 6 536200033 Parking Ratio �� 8.70 : 1,000 SF Landscaping...... Professional 7 536203015 Topography...... Generally Level 8 536238001 9 536205001 10 536205015 06 11 536239001 local and regional map

SUBJECT PROPERTY

local regional

Midtown center, pueblo, co | 7 Suite Tenant SF A Uhaul 355 site plan B PPAL 300 C Touch of Class 392 D Touch of Class 590 E Pinelles 34,714 F Vacant 597 G-H Pueblo Hearing 1,152 I Colorado Legal 3,004 J Smoker Friendly K So Co Sewing 1,700 L Peels Salon 3,500 M Angles of Hope 570 N Aileens 1,284 O Top Nails 1,073 P Honey Baked 3,020 Q BlackJack Pizza 2,000 R Elmwood Staffing 1,700 S All Risk Insurance 1,675 T InZone Fitness 4,500 U Us Postal 5,024 V Moreschini 2,165 W Express Scripts 75,000 Vacant Land (1.62 AC) W-1 Vacant 1,600 W-2 Frani's Beads 1,900 X Youth and Family Academy 10,000 Vacant Land (1.14 AC) Y Larsens Automotive 3,000 Z ABC Bank Midtown 3,847 1005 W 6th Apria Home Health Care 11,968 Vacant Land (0.54 AC) 1007 W 6th Bourbon Room 13,975 827 W 4th DMV 8,350 827 W 4th Ste B Vacant 3,000 905 W 4th M&M liquor 1,677 824 W 4th Tory Vujcich 4,125 Occupied Totals 203,768 Vacant Totals 5,125 Totals 208,893 8 | Matthews Retail Advisors tenant map

Matthews Retail Advisors | 9 area overview

Pueblo, Colorado The City of Pueblo has a long and colorful history dating back to 1842, when it was called Fort Pueblo. What brought the city from a small fort in southern Colorado to a major city were the ore mines. This area once housed 4 separate towns, Pueblo, South Pueblo, Central Pueblo, and Bessemer. These 4 towns together now make up the City of Pueblo.

The City of Pueblo is also known as “America’s Home of Heroes,” as was proclaimed by the United States Congress in 1993. Pueblo hosts National Medal of Honor Day and has had as many as 4 living Medal of Honor recipients living in their community.

Economically, Pueblo is booming. It is one of the largest steel-producing cities in the United States and is often referred to as the “Steel City”. 10 Additionally, Pueblo has one of the top 5 lowest costs of living when comparing price levels of housing, utilities, transportation, and groceries. points of interest

colorado state fair lake pueblo pueblo zoo

The Colorado State fair is an annual event Lake Pueblo has been rated a “fishing hot spot” The Pueblo Zoo is an AZA (Association of Zoos located in Pueblo. The fair features a variety as it provides 60 miles of shoreline, 4,600 and Aquariums) accredited facility that covers of events including concerts, rodeos, parades surface acres of water, and 10,000 acres of twenty-five acres in the southwest quadrant of and carnival rides and games. This event takes land. The area offers a full-service marina and a Pueblo City Park. It is home to more than 500 place at the end of August and runs through the variety of campsites so guests can stay awhile. animals representing over 125 different species beginning of September. Along with the top ranked fishing, you can find from around the world. The Zoo is a place where guests sailing, waterskiing and much more. animals are exhibited in natural settings.

whitewater park pueblo mountain park steelworks museum

Located in Downtown Pueblo, the Whitewater Colorado is known for its beautiful scenery The Steelworks Center of the West provides Park is approximately ½ mile long and contains and guests can immerse themselves in nature continuing education to the public through eight drops. While it is called a “park”, this kayak at Pueblo Mountain Park. Several hiking trails the preservation of historic archives, artifacts course is a real river. are found on the 611-acre park whether it be and buildings of the Colorado Fuel and Iron a guided hike or discovering your own path. Company (CF&I), and related activities leading Additionally, Horseshoe Lodge offers a “nature to the industrialization of the entire Western inspired” bed and breakfast so visitors can stay United States. multiple days. Midtown center, pueblo, co | 11 pueblo community development Portland Park Shelters: 1700 Block of East 19 Street – Eastside Neighborhood. Installation of one park shelter and the accompanying ADA accessible route, relocation of irrigation system, electrical service and lighting, installation of new picnic tables.

St Anne’s Park Ball Field Rehabilitation: 2700 E. 12 Street -Eastside Neighborhood The project will undertake the rehabilitation of the ballfield to include the removal of substandard structures to provide improved playing conditions to area residents and youth baseball teams. Improvements to be undertaken are construction of the backstop, removal and replacement of broken chain-link fencing, construction of a new announcer’s booth and new infield mix.

Installation of Streetlights: 2500 & 2600 Blk. E. 9 St & 2600 Blk. E. 10 St Installation of three cobra head streetlights on the above listed streets. At present there are no streetlights on these blocks. Improvements will provide for safer pedestrian and vehicular transit.

City outline colorado springs COLORADO SPRINGS BY THE NUMBERS Only 40 minutes from Pueblo is the second most populous city in Colorado, Colorado Springs. This city is a prime tourist location as it’s at the base of Pikes Peak and the Rocky Mountains and has an average 445,830 of 243 sunny days per year. 5 million visitors come to the area annually contributing $1.35 billion in POPULATION revenue. Colorado Springs has more than 55 attractions and activities in the area including the U.S. Olympic Training Center. $72,579 The city’s economy is still based heavily on tourism, although in more recent years, Colorado Springs has AVERAGE HOUSEHOLD INCOME gained a strong foothold in the electronics, high-technology, and manufacturing industries while having a growing commercial economy led by varying components of the high-tech industry. Additionally, the area has seen a dramatic population growth over the last 30 years with the unemployment rate being 34.4 below the US average. MEDIAN AGE

Olympic training center

colorado springs top employers

Memorial Health Services

Penrose – St. Francis Health Services

Lockheed Martin Corporation

Atmel Corporation

Hewlett Packard

Broadmoor Hotel Colorado Springs is home to the United States Olympic Training Center and the headquarters of the United States Olympic Committee. Additionally, 24 of Progressive Insurance Company the United States’ national federations for individual Olympic sports have their Verizon Business headquarters in Colorado Springs including the United States bobsled, fencing and figure skating. Figuring skating has had a particularly long associate with the city having hosted the U.S. Figure Skating Championships six times and the World Figure Skating Championships five times. Midtown center, pueblo, co | 13 14 financial overview Income & Expenses In Place Year Total $/SF Income Rental Income $1,144,199 $5.48 Expense Reimbursements $290,635 $1.39 Effective Gross Income $1,434,833 $6.87 Expenses Real Estate Taxes $90,616 $0.43 Property Insurance $48,756 $0.23 CAM/R&M $306,936 $1.47 Management/Admin $43,045 $0.21 EGI (3%) Misc Expenses $10,000 $0.05 Operating Expenses $499,353 $2.39 Net Operating Income $935,480 $4.48 Operating Expense Ratio 34.80% SF 208,893

Recent Leases

Contract Rental Rate Lease Expense Free T.I.s T.I.s Tenant Name Unit # Terms Start Date Size (SF) $/SF/Yr. $/SF/Mo. Term Reimb. Rent $/SF Total $ Touch Of Class C&D Relo Jan-17 982 $12.22 $1.02 3 Years NNN None $2.26 $2,220 Bourbon Room 1007 W 4th St New Aug-16 13,975 $4.29 $0.50 5 Years NNN N/A $1.72 $24,000 Elmwood Staffing R New Aug-15 1,700 $9.83 $0.82 5 Years NNN N/A $2.17 $3,684 So Co Sewing K New Jun-15 1,700 $9.06 $0.76 2 Years NNN N/A $1.81 $3,084 Uhaul A New Jun-15 355 $14.54 $1.21 2 Years NNN N/A $2.37 $840 PPAL B New Sep-15 300 $10.00 $0.83 2 Years Gross N/A Total 19,012 Midtown center, pueblo, co | 15 Rent Roll

Contract Rental Rate Rent Per Sq. Ft. Unit Tenant Lease Start Lease End SF % of GLA Rent PSF Rent Increases Annual Recovery Recovery Per Area Year Month Year Month Apr-16 $96,000 A Uhaul 6/1/2015 5/31/2017 355 0.17% $16.90 $5,160 $430 $14.54 $1.21 $840 $2.37 Apr-17 CPI

B PPAL 9/1/2015 8/31/2017 300 0.14% $10.00 $3,000 $250 $10.00 $0.83 Jul-15 Base + % $0 $0.00

C Touch of Class 1/1/2017 12/31/2019 392 0.19% $10.71 $4,200 $350 $10.71 $0.89 None $884 $2.25

D Touch of Class 1/1/2017 12/31/2019 590 0.28% $13.22 $7,800 $650 $13.22 $1.10 None $1,331 $2.26

Apr-16 $96,000 E Pinelles 6/1/1995 4/30/2019 34,714 16.62% $1.79 $62,000 $5,167 $1.79 $0.15 $13,600 $0.39 Apr-17 CPI Apr-16 $96,000 F Vacant 597 0.29% $0 $0.00 $0.00 $0 $0.00 Apr-17 CPI Apr-16 $96,000 G-H Pueblo Hearing 6/1/1989 8/31/2021 1,152 0.55% $9.98 $11,500 $958 $9.98 $0.83 $2,600 $2.26 Apr-17 CPI

I Colorado Legal 9/1/2002 9/21/2020 3,004 1.44% $10.39 $31,200 $2,600 $10.39 $0.87 None $0 $0.00

J Smoker Friendly 10/1/2012 9/30/2018 1,136 0.54% $14,400 $1,200 $12.68 $1.06 None $2,512 $2.21

K So Co Sewing 6/1/2015 5/31/2017 1,700 0.81% $8.01 $15,410 $1,284 $9.06 $0.76 Annual CPI $3,082 $1.81

L Peels Salon 3/1/2006 1/31/2021 3,500 1.68% $12.00 $42,000 $3,500 $12.00 $1.00 None $7,000 $2.00

Mar-17 $110,000 M Angles of Hope 1/1/2007 1/8/2020 570 0.27% $12.65 $7,212 $601 $12.65 $1.05 Mar-18 $120,000 $1,193 $2.09 Mar-19 $130,000

N Aileens 5/1/1984 1/5/2020 1,284 0.61% $5.58 $7,162 $597 $5.58 $0.46 None $2,720 $2.12

O Top Nails 7/15/2003 8/31/2018 1,073 0.51% $11.62 $9,883 $824 $9.21 $0.77 Annual 3% min/5% max $2,590 $2.41

P Honey Baked 4/1/2004 10/31/2019 3,020 1.45% $5.69 $24,000 $2,000 $7.95 $0.66 Every 5 Years 10% $6,814 $2.26

Q BlackJack Pizza 3/1/1997 4/30/2017 2,000 0.96% $10.78 $21,560 $1,797 $10.78 $0.90 Annual 3% $4,844 $2.42

Sep-20 $274,265 R Elmwood Staffing 8/1/2015 7/31/2020 1,700 0.81% $9.83 $16,711 $1,393 $9.83 $0.82 $3,689 $2.17 Sep-25 $301,722

S All Risk Insurance 5/1/1990 10/31/2017 1,675 0.80% $9.25 $15,492 $1,291 $9.25 $0.77 $3,780 $2.26

16 | Matthews Retail Advisors Contract Rental Rate Rent Per Sq. Ft. Unit Tenant Lease Start Lease End SF % of GLA Rent PSF Rent Increases Annual Recovery Recovery Per Area Year Month Year Month Apr-16 $96,000 A Uhaul 6/1/2015 5/31/2017 355 0.17% $16.90 $5,160 $430 $14.54 $1.21 $840 $2.37 Apr-17 CPI