Freddy’s Frozen Custard & SteakburgersMeridian, Idaho

Freddy’s frozen custard

New Construction bOISE msa NNN OpportunityEagle Road & Lanark Street, Meridian, ID 83642

[ www.CapitalPacific.com ]

Meridian, ID

MICHAEL HORWITZmhorwitz@capitalpacific.com | (503) 675-8371 ID BRE# DB39718

SEAN MACKsmack@capitalpacific.com | (503) 675-8378 ID BRE# SP34992

KEVIN ADATTOkadatto@capitalpacific.com | (503) 675-7726 ID BRE# SP39857

PETER DUNNpdunn@capitalpacific.com | (503) 607-0197 ID BRE# SP41756

RENTABLE SF . . . . . . 3,027 SF

SITE AREA . . . . . . . . . 35,696 SF

LEASE TYPE. . . . . . . . NNN

YEAR BUILT . . . . . . . . 2014

PARKING . . . . . . . . . . 38 STALLS

FREDDY’S FROZEN CUSTARD AND STEAKBURGERS IS A SINGLE TENANT ABSOLUTE NET LEASED PROPERTY LOCATED

ON THE MAIN NORTH SOUTH THOROUGHFARE IN MERIDIAN, IDAHO.

Eagle Road & Lanark Street, Meridian, ID 83642

ADDRESS:

This offering presents an opportunity to acquire a Freddy’s Frozen Custard building that is currently under construction with a

scheduled completion date of September 2014. The property offers a new 15-year NNN lease with annual 1.5% rental increases two 10-year

option periods.

The property is located in the city of Meridian, the fastest growing city in the State of Idaho. Meridian, which is located in the Boise area, has more than doubled in population since 2000.

Freddy’s Frozen Custard Meridian is located on North Eagle Road, the main north-south thoroughfare in Meridian. The property is also located less than a mile north of Interstate 84 that runs through the state.

PRICE: $2,682,782CAP: 6.65%

Investment Highlights

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1.5% Annual rental increases

BRAND NEW 15 YEAR

LEASE

PERSONAL GUARANTEELease signed and guaranteed by high net worth entity and personal guarantee

NEW 15-YEAR LEASEFranchisee executed a 15-year lease that commences at completion of building construction with 1.5% annual rental increases in both the primary term and two 10-year option periods. Operators rent as a percentage of sales for existing locations is less than 6%.

GROWING SUBMARKETThe city of Meridian is the fastest growing city in the State of Idaho. Since the year 2000, Meridian’s population has increased by more than 140%

NEW CONSTRUCTION

Construction is expected to be completed in September 2014

NNN LEASE PROVIDES PASSIVE MANAGEMENTTenant is responsible for taxes, insurance, utilities, and repair and maintenance of the roof and all structural elements of the building

NEW DEVELOPMENT CenterCal will complete The Village at Meridian in late 2014. This mixed-use development is less than 1 mile north of the Property and includes over 350,000 square feet of retail and a 400,000 square foot apartment complex

RAPID GROWTH The headquarters for Scentsy is located directly to the north of the site. There are roughly 500 employees in these buildings

Investment Highlights[ REPRESENTATIVE PHOTO ]

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Aerial

W Franklin Road

W Fairview Avenue

E Lanark Street

8430

BOISE 10 MILES

N E

agle

Roa

d55

THE VILLAGE AT MERIDIAN

112,00 DAILY

Ashley FurnitureAxiom FitnessBabies ‘R’ UsBig Al’sBlimpieBuffalo Wild WingsCharming CharlieChico’sDel TacoDiscount TireFrancesca’sGap Factory StoreLesSchwabLOFTMajestic CinemasMcDonald’sNike Factory StoreNorcoOld NavyO’Reilly Auto Parts

Office DepotPayless ShoeSourcePetcoPetsMartPro Image SportsRed RobinRepublic of CoutureRosauersShopKoSleep CountrySmashBurgerSomaSportsmasStarbucksSubwaySur La TableTaco BellToys ‘R’ UsWalgreens

OTHER RETAILERS ALONG RETAIL CORRIDOR

THE VILLAGE AT MERIDIAN

KEY

RETAIL CORRIDOR

SUBJECT PROPERTY

1 MILE FROM THE VILLAGE AT MERIDIAN

CenterCal Properties is developing a large scale mixed-use project just north of Freddy’s Meridian. The Village at Meridian features upscale apparel and specialty retail, fine restaurants and cafes, Village Cinemas, and luxury office space. National brands occupying the center include Gordmans, Marshalls, Nike Factory Store, and Petco. 54

,328

DA

ILY

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Site Plan

Site Plan Not To Scale

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Financial Summary

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. Buyer must verify the information and bears all risk for any inaccuracies.

PRICE $2,682,782 Loan Amount

Price Per Square Foot: $886.28 Interest Rate

Building Size (SF): 3,027 Amortization

Site Area (SF): 35,696 Term*

Capitalization Rate: 6.65% Net Operating Income

Year Built: 2014 Debt Service

STABILIZED INCOME Per Square Foot Pre-Tax Cash Flow

Rent $58.94 $178,405 Debt Coverage Ratio

LESS Per Square Foot

Taxes NNN $0.00 Pre-Tax Leveraged Cash-on-cash Return

Insurance NNN $0.00 Principal Paydown (Year 1 of Ownership)

Total Operating Expenses $0.00 Total Return

EQUALS NET OPERATING INCOME $178,405 Yield

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*Interest rate is fixed for 5 years

7/31/2014 Capital Pacific Real Estate Brokerage Co.FREDDY’S | 6

Rent Roll

BETHEL JUNCTION | 7This 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. Buyer must verify the information and bears all risk for any inaccuracies.

TENANT INFO

Tenant Name Sq. Ft. Current Rent Monthly Rent Cap RateMonthly Rent/FT

Yearly Rent/FT

Freddy's 3,027 $178,405 $14,867 6.65% $4.91 $58.94

$181,081 $15,090 6.75% $4.99 $59.82

$183,798 $15,317 6.85% $5.06 $60.72

$186,555 $15,546 6.95% $5.14 $61.63

$189,353 $15,779 7.06% $5.21 $62.55

$192,193 $16,016 7.16% $5.29 $63.49

$195,076 $16,256 7.27% $5.37 $64.45

$198,002 $16,500 7.38% $5.45 $65.41

$200,972 $16,748 7.49% $5.53 $66.39

$203,987 $16,999 7.60% $5.62 $67.39

$207,047 $17,254 7.72% $5.70 $68.40

$210,152 $17,513 7.83% $5.79 $69.43

$213,305 $17,775 7.95% $5.87 $70.47

$216,504 $18,042 8.07% $5.96 $71.52

$219,752 $18,313 8.19% $6.05 $72.60

Option 1 16 25

Option 2 26 35

Current Totals: 3,027 $178,405 $14,867 6.65% $4.91 $58.94

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RENT SUMMARYLEASE TERMS

Term

1.5% Annual increases

1.5% Annual increases

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PREMISES/TERMTENANT Freddy’s Frozen CustardSQUARE FEET 3,027 SFDATE OF LEASE 3/10/2014EXPECTED RENT COMMENCEMENT October 2014EXPIRATION September 2029 OPTIONS Two 10-year with1.5% annual rental increases

Lease Abstract

REIMBURSEMENTSThis is a standard NNN lease, Tenant shall pay directly for taxes, insurance and Common Area Maintenance.

TENANT REPAIRSTenant is responsible for maintaining, repairing and replacing all structural elements of the Building, including the exterior of the Property.

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[ REPRESENTATIVE PHOTO ]

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ABOUT FREDDY’S FROZEN CUSTARD

Freddy’s Frozen Custard & Steakburgers is a quick-service restaurant chain based in Wichita, Kansas. The company opened its doors in 2002, franchised in 2004, and now there are currently 113 Freddy’s restaurants across 18 states. From sandwiches to sundaes, Freddy’s makes food fresh to order.

Freddy’s Frozen Custard has again been recognized by Franchise Times® Magazine, this time on its inaugural Fast and Serious list in the March issue. The list uses a 10-point formula to identify fast-growing franchise systems that also have staying power. It is based on three years of impressive unit and sales growth, and includes brands in other industries, not just restaurants.

For 2013, Freddy’s was again named among Entrepreneur Magazine’s “Franchise 500®”, repeated its recognition by QSR® magazine as one of four “Rising Stars” in the Best Franchise Deals issue, Franchise Times® Magazine’s “Next 300 Franchise Chains” and was included among Inc. Magazine’s 500/5000 list of “Fastest Growing Private Companies”. In 2012, besides those recognitions repeated in 2013, Freddy’s was named one of Business Insider’s “8 Better Burger Chains Poised to Conquer America.”

LEASE SIGNED & GUARANTEED

BY VERY STRONG FRANCHISEE

Freddy’s

ABOUT FRANCHISEE

The franchisee is an investor group of very strong guarantors (ask Agent for more details) whom have a 40-unit franchise agreement with Freddy’s Custard’s in Arizona, Utah, and Idaho. They have been operating on behalf of this franchise for over 3 years and currently have two locations in Tucson, Arizona, one in St. George, Utah, and another in Surprise, Arizona. The Meridian store brings them to a total of 5 locations with leases signed to have 10 total stores within a year. They intend to open a total of 20 stores within 3 years. There are two separate personal guaranty’s on the lease.

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BOISE METROPOLITAN AREA OVERVIEW

Boise is the capital and most populous city of the state of Idaho, as well as the county seat of Ada County. Located on the Boise River, it anchors the Boise City-Nampa metropolitan area and is the largest city between Salt Lake City, Utah and Portland, Oregon.

As of the 2010 Census, the population of Boise was 205,671. It is also the 99th largest U.S. city by population. The 2012 U.S. Census Population Estimates that 212,303 people reside within the city. The Boise metropolitan area is home to about 616,500 people and is the most populous metropolitan area in Idaho, containing the state’s three largest cities; Boise, Nampa, and Meridian.

3 Mileradius

Meridian

Boise

84

5 Mileradius

Meridian

Boise

1-MIles 3-Miles 5-MilesMedian $58,074 $57,949 $57,030 Average $73,482 $81,755 $81,539

2013 HOUSEHOLD INCOMES

Market Intel & Demos

3-Miles 5-Miles2010 79,414 188,3172013 82,432 196,7582018 89,165 213,478

SURROUNDING POPULATION

BOISE METROPOLITAN AREA OVERVIEW

Boise is the capital and most populous city of the state of Idaho, as well as the county seat of Ada County. Located on the Boise River, it anchors the Boise City-Nampa metropolitan area and is the largest city between Salt Lake City, Utah and Portland, Oregon.

As of the 2010 Census, the population of Boise was 205,671. It is also the 99th largest U.S. city by population. The 2012 U.S. Census Population Estimates that 212,303 people reside within the city. The Boise metropolitan area is home to approximately 616,500 people and is the most populous metropolitan area in Idaho, containing the state’s three largest cities; Boise, Nampa, and Meridian.

ECONOMYLARGEST EMPLOYERS:

Boise is the headquarters for several major companies, such as Boise Cascade LLC, Albertsons, J.R. Simplot Company, Idaho Pacific Lumber Company, Idaho Timber, WinCo Foods, Bodybuilding.com, and Clearwater Analytics. Other major industries are headquartered in Boise or have large manufacturing facilities present. The state government is also one of the city’s largest employers.

The area’s largest private, locally based, publicly traded employer is Micron Technology. Others include IDACORP, Inc., the parent company of Idaho Power, Idaho Bancorp, Boise, Inc., American Ecology Corp., PCS Edventures.com Inc. and Syringa Bancorp.

NAMPA

caldwell

ONtario

emmett

eagle

BOISE 10 MILES

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Construction Details

60mm Thermoplastic Membrane Roofing with 20-year warranty

ROOF

EXTERIOR WALLSFOUNDATION

Concrete footings with 4” on grade concrete slab

Metal stud with insulation, exterior skin is a combination of EIFS and brick veneer

PARKING

38 parking stalls with a cross access agreement for parking lot with Mattress Firm

HVAC

Three HVAC units- Two 7.5 tons and one 12.5 tons

Main water service is a 1.5” line

PLUMBING

Property is ADA compliant.

AMERICANS WITH DISABILITIES

208/120 volt service

ELECTRICAL

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A unique HUMANRESULTS-DRIVEN client experience

THE CAPITAL PACIFIC EXPERIENCE - OUR DAILY COMMITMENT TO OUR CLIENTS

[ www.CapitalPacific.com ]

[ REPRESENTATIVE PHOTO ]

KEVIN ADATTOkadatto@capitalpacific.com | (503) 675-7726 ID BRE# SP39857

SEAN MACKsmack@capitalpacific.com | (503) 675-8378 ID BRE# SP34992

MICHAEL HORWITZmhorwitz@capitalpacific.com | (503) 675-8371 ID BRE# DB39718

PETER DUNNpdunn@capitalpacific.com | (503) 607-0197 ID BRE# SP41756