NET LEASE INVESTMENT OFFERING Shopko Hometown 406 Gateway Avenue Mauston, Wisconsin 53948 TABLE OF CONTENTS I. Executive Summary II. Location Overview III. Market & Tenant Overview Executive Summary Site Plan Tenant Profile Investment Highlights Aerial Location Overview Property Overview Map Demographics Photos NET LEASE INVESTMENT OFFERING DISCLAIMER STATEMENT DISCLAIMER The information contained in the following Offering Memorandum is proprietary and strictly confidential. It STATEMENT: 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 a single tenant net leased Shopko Hometown SUMMARY: property located in Mauston, Wisconsin. The property is strategically located along a primary thoroughfare immediately off of a signalized intersection. The Shopko Hometown features a pharmacy drive-thru and excellent visibility. There are over 12 years remaining on the Shopko Hometown lease which expires in October 2030. The lease features 3% rental escalations every five years and four 5-year renewal option periods. Shopko is a privately owned retailer with more than 360 stores in 24 states. The 26,395 square foot building was constructed in 2015 and is strategically located off of the signalized intersection of Gateway Avenue and Union Street. The intersection experiences a combined traffic count of 29,100 vehicles per day. The property is also less than one-half mile from Interstate 90 with interchangeable access. Interstate 90 experiences traffic counts in excess of 26,900 vehicles per day. The Shopko Hometown retail format offers a differentiated and successful merchandising strategy. Shopko Hometown offers household goods and dry grocery assortment with a broad and dynamic offering of strong national brands and high-value private label brands of apparel, home goods, toys, consumer electronics, seasonal items, and lawn and garden products. Shopko Hometown serves as the primary shopping destination for residents in the area with limited competition. The subject property is located within close proximity to multiple residential communities, local businesses, and schools. National retailers in the immediate area include Walgreens, Kmart, O’Reilly Auto Parts, McDonald’s, Hardee’s, Culver’s and Denny’s. There are over 12 years remaining on the Shopko Hometown lease that expires October 31, 2030. The lease features 3% rental escalations every five years and four 5-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 • Tenant is a privately held $3 billion retailer that operates over 360 locations in 24 states HIGHLIGHTS: • Rental escalations in primary terms and renewal option periods • 15 year corporate lease with over 12 years remaining • 3% rental escalation in 2020 • Drive-thru pharmacy • Exceptional visibility and access to 29,100 vehicles per day • Less than one-half mile west of Interstate 90 (26,900 VPD) • Limited competition in the area • Retailers in the immediate area include Walgreens, Kmart, O’Reilly Auto Parts, McDonald’s, Hardee’s, Culver’s and Denny’s NET LEASE INVESTMENT OFFERING PROPERTY OVERVIEW PROPERTY Price: $4,403,500 OVERVIEW: Cap Rate: 8.25% Net Operating Income: $363,284 $374,182 11/2020 $385,408 11/2025 $396,970 11/2030 (Option 1) $408,879 11/2035 (Option 2) $421,145 11/2040 (Option 3) $433,780 11/2045 (Option 4) Rental Escalations: 3% Every 5-Years Renewal Options: Four 5-Year Lease Commencement Date: October 4, 2015 Lease Expiration Date: October 31, 2030 Tenant: ShopKo Stores Operating Co., LLC (Corporate) Year Built: 2015 Lease Type: NN* Parking: 98 Spaces Rentable Square Feet 26,395 SF Lot Size: 2.52 Acres Property Address: 406 Gateway Avenue, Mauston, WI 53948 *Tenant is responsible for all maintenance, repairs and replacements of the HVAC system subject to a maximum of $5,000 per calendar year. Landlord is responsible for Roof and Structure. **Replacement of all or any portion of the Parking Lot required during the first 9 years of the lease term is the landlord’s responsibility. Tenant shall annually reimburse Landlord amortized portion of cost. NET LEASE INVESTMENT OFFERING SITE PLAN LINCOLN STREET GATEWAY AVENUE / STATE ROAD 82 (15,300 VPD) ROOSEVELT STREET UNION STREET (13,800 VPD) (13,800 STREET UNION NET LEASE INVESTMENT OFFERING N AERIAL ) D P V 0 0 3 , 5 1 ( 2 8 d a (26,900 VPD) 90 Gateway Avenue / State Ro State / Avenue Gateway Union Street (13,800 VPD) NET LEASE INVESTMENT OFFERING INVESTMENT LEASE NET MAP N NET LEASE INVESTMENT OFFERING EXTERIOR PHOTOS NET LEASE INVESTMENT OFFERING TENANT PROFILE TENANT Shopko Stores Operating Co., LLC operates a chain of general merchandise stores in the United States. Its PROFILE: 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 LOCATION OVERVIEW LOCATION Mauston is a city in and the county seat of Juneau County, Wisconsin with a population of OVERVIEW: over 4,500 people. Incorporated in 1887, the city’s beginning was based on the lumber industry of early Wisconsin. Located on the Lemonweir River and next door to Wisconsin’s second and fourth largest lakes, Petenwell and Castle Rock Lake, Mauston finds you surrounded by natural wonder, wildlife and a rich variety of outdoor activities. Mauston also has a rich rural history with easy access to cranberry bogs, dairy farms, apple orchards, and Amish country. Mauston is located on Interstate 90-94. Mauston’s location gives it the advantage of maintaining a “small town” life style with a short commute to “big city” activities. The Community is within a three- hour drive to both Chicago and Minneapolis. Close enough for a client visit, yet far enough away to get quality rural talent and lower real estate costs. Several unique recreational and cultural experiences surround Mauston. Wisconsin Dells is only 15 minutes east of town. Miles of state bike trails pass through the county, and the nationally acclaimed Necedah Wildlife Refuge lies few miles north. Mauston is a full service municipality providing police and fire protection, public works, water/wastewater utilities, solid waste collection, curbside recycling, a small airport, parks and recreation, planning/zoning and other services. Mauston’s unique name originally was “Maughs Town,” named after its founder Milton Maugh. www.mauston.com NET LEASE INVESTMENT OFFERING DEMOGRAPHICS DEMOGRAPHIC REPORT: Population 1 Mile 3 Mile 5 Mile Total Population 3,247 5,650 7,200 Total Households 1,399 2,287 2,901 Income 1 Mile 3 Mile 5 Mile Median Household Income $45,852 $48,275 $50,684 Average Household Income $54,875 $58,092 $60,691 NET LEASE INVESTMENT OFFERING Randy Blankstein President 847.562.0003 [email protected] Jimmy Goodman Partner 847.562.8500 [email protected] 666 Dundee Road, Suite 1801 Northbrook, IL 60062 www.bouldergroup.com.