NET LEASE INVESTMENT OFFERING SHOPKO 2500 Humes Road (US Highway 14) Janesville, Wisconsin 53545 TABLE OF CONTENTS TABLE OF CONTENTS I. Executive Profile II. Location Overview III. Market & Tenant Overview Executive Summary Photographs Demographic Report Investment Highlights Aerial Market Overview Property Overview Site Plan Tenant Overview Map NET LEASE INVESTMENT OFFERING DISCLAIMER STATEMENT DISCLAIMER The information contained in the following Offering Memorandum is proprietary and strictly confidential. STATEMENT: It is intended to be reviewed only by the party receiving it from The Boulder Group and should not be made available to any other person or entity without the written consent of The Boulder Group. This Offering Memorandum 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. The Boulder Group has not made any investigation, and makes no warranty or representation. The information contained in this Offering Memorandum has been obtained from sources we believe to be reliable; however, The Boulder Group has not verified, and will not verify, any of the information contained herein, nor has The Boulder Group 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. NET LEASE INVESTMENT OFFERING EXECUTIVE SUMMARY EXECUTIVE The Boulder Group is pleased to exclusively market for sale the fee simple interest in a single tenant absolute triple SUMMARY: net leased Shopko property located in Janesville, Wisconsin. The property is strategically located at a signalized intersection in a dominant retail corridor. Shopko is committed to this location as evidenced by their long operating history at this location (since 1980). There is over 17 years remaining on the Shopko lease that features a low rent per square foot ($7.90), annual rental escalations and two 10-year renewal option periods. This is a high performing location with above average sales per square foot. Shopko is a privately owned retailer with more than 360 stores in 24 states. The 98,005 square foot building is well located within the regional trade area. The property is strategically located at the signalized intersection of Humes Road and Lexington Drive which experiences traffic counts of 26,500 vehicles per day. Humes Road is the primary thoroughfare in the area with on/off access to Interstate 90 (60,000 vehicles per day). The property is surrounded by a number of big box retailers including Walmart Supercenter, Target, Sam’s Club, The Home Depot, Menards, Hobby Lobby and Best Buy. Immediately south of the property is Janesville Mall, a 627,000 square foot mall with over 60 stores. Retailers located within the mall include Boston Store, Dick’s Sporting Goods, Kohl’s, Sears, Victoria’s Secret, Chuck E. Cheese’s, Ulta Beaty and Steinhafels to name a few. There are over 71,200 people living within a three mile radius of the property with average annual household incomes in excess of $71,225 per year. There are over 17 years remaining on the lease that expires December 31, 2035. The triple net lease features annual rental escalations and two 10-year renewal option periods. Shopko operates more than 360 stores in 24 states throughout the Central, Western and Pacific Northwest regions. The company was founded in 1962 and is headquartered in Green Bay, Wisconsin. NET LEASE INVESTMENT OFFERING INVESTMENT HIGHLIGHTS INVESTMENT • Long term lease with over 17 years remaining HIGHLIGHTS: • Absolute triple net lease with no landlord responsibilities • Annual rental escalations in primary terms and renewal option periods • Strong location with favorable unit level performance • 38 year operating history at this location • Low rent per square foot ($7.90) • Exceptional visibility and access to 26,500 vehicles per day • Abundant parking with over 400 parking spaces • Less than one-half mile west of Interstate 90 (60,000 VPD) with direct on/off access • Retailers in the immediate area include Walmart Supercenter, Target, Sam’s Club, The Home Depot, Menards, Hobby Lobby and Dick’s Sporting Goods • Tenant is a privately held $3 billion retailer that operates over 360 locations in 24 states NET LEASE INVESTMENT OFFERING PROPERTY OVERVIEW PROPERTY Price: $9,991,500 OVERVIEW: Cap Rate: 7.75% Net Operating Income: $774,338 Rental Escalations: 1.95% Annually* Renewal Options: Two 10-Year Lease Commencement Date: May 31, 2006 Lease Expiration Date: December 31, 2035 Tenant: ShopKo Stores Operating Co., LLC Year Built: 1980 Lease Type: Absolute Triple-Net (NNN) Parking: 400+ Spaces Rentable Square Feet 98,005 SF Lot Size: 8.64 Acres Property Address: 2500 Humes Road, Janesville, Wisconsin 53545 * The Base Rent increases by the lesser of: (i) 1.25 multiplied by the product of (A) the Base Rent in effect and (B) the CPI Increase or (ii) 1.95% of the Base Rent. NET LEASE INVESTMENT OFFERING PHOTOGRAPHS NET LEASE INVESTMENT OFFERING AERIAL NET LEASE INVESTMENT OFFERING SITE PLAN NET LEASE INVESTMENT OFFERING MAP ASSEMBLY PLANT NET LEASE INVESTMENT OFFERING MAP NET LEASE INVESTMENT OFFERING DEMOGRAPHIC REPORT DEMOGRAPHIC Population 3-Mile 5-Mile 7-Mile REPORT: Total Population 40,656 66,453 78,549 Total Households 16,865 27,189 31,926 Income 3-Mile 5-Mile 7-Mile Median Household Income $56,232 $53,579 $54,460 Average Household Income $71,224 $68,330 $68,923 NET LEASE INVESTMENT OFFERING MARKET OVERVIEW MARKET Janesville, Wisconsin OVERVIEW: Janesville is a city with a population of 63,575 people located on the Rock River in the rolling hills, rich fields and verdant woodlands of scenic south central Wisconsin. Janesville was founded in 1836 and has experienced steady growth and development ever since. Janesville’s long history of strong industry and economic success has helped turn the city into a major commercial and industrial center for the State-Line area. Businesses headquartered in Janesville include Blain’s Farm and Fleet, a three-state retail chain; Woodman’s Food Market, a regional supermarket chain that built its first store in Janesville; Swing’n’Slide, a maker of wood-and-plastic playground equipment; Hufcor (formerly Hough Shade Company), a manufacturer of room dividers that markets internationally; and Gray’s Brewing, maker of boutique beers and soft drinks. Perhaps what Janesville is best known for is its abundance of beautiful parks and recreational areas. Handy boat launches, numerous ball fields, playgrounds, two public golf courses, tennis courts, over 2,300 acres of parkland and 25+ miles of paved bike trail are just some of the amenities enjoyed by Janesville residents. www.ci.janesville.wi.us | www.janesvillecvb.com NET LEASE INVESTMENT OFFERING TENANT OVERVIEW TENANT Shopko OVERVIEW: Shopko Stores Operating Co., LLC operates a chain of general merchandise stores in the United States. Its stores comprise jewelry and watches, home, kitchen and dining, furniture, electronics, toys, sports and team shop, health and beauty, and patio and seasonal departments; clothing and accessories for men, women, kids, and babies, as well as nursery furniture. The company’s stores also include in-store pharmacies and optical centers. It also serves customers online. Shopko Stores Operating Co., LLC was formerly known as ShopKo Stores, Inc. The company was founded in 1962 and is headquartered in Green Bay, Wisconsin. It has distribution centers in DePere, Wisconsin; Boise, Idaho; Omaha, Nebraska; and Lebanon, Indiana. Shopko operates more than 360 stores in 24 states throughout the Central, Western and Pacific Northwest regions. Retail formats include more than 130 Shopko stores, providing quality name-brand merchandise, great values, pharmacy and optical services in small to mid-sized cities; 5 Shopko Express Rx stores, a convenient neighborhood drugstore concept; 5 Shopko Pharmacy locations; and more than 220 Shopko Hometown stores, a smaller concept store developed to meet the needs of smaller communities. Shopko Stores Operating Co., LLC is an affiliate of Sun Capital Partners, Inc., a leading private investment firm focused on leverage buyouts, equity, debt, and other investments in market-leading companies that can benefit from its in-house operating professionals and experience. Sun Capital affiliates have invested in and managed more than 340 companies worldwide. Sun Capital has offices in Boca Raton, Los Angeles, and New York, and affiliates with offices in London, Tokyo, and Shenzhen, China. Website: www.shopko.com Founded: 1962 Number of Locations: 360+ Number of Employees: 16,900+ Headquarters: Green Bay, Wisconsin Parent Company: Sun Capital Partners, Inc. NET LEASE INVESTMENT OFFERING Randy Blankstein President 847.562.0003 [email protected] Jimmy Goodman Partner 847.562.8500 [email protected] 3520 Lake Avenue, Suite 203 Wilmette, IL 60091 www.bouldergroup.com.