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11 West Mercer Street - Seattle, Washington 98119

Actual Property

24HOURS

New ConstructionOpen 24 Hours

31 Dedicated Parking StallsNew 25-Year Triple-Net (NNN) Lease

2 Blocks From Seattle CenterOn Signalized Intersection

Walk Score Of 96

SEATTLE, WASHINGTONo f f e r i n g m e m o r a n d u m

Developed by:

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. Marcus & Millichap is a trademark of © 2016 Marcus & Millichap. All rights reserved. Activity ID # X0331883


Investment Overv iew

• Newly Constructed 24-Hour CVS Located in the Heart of the Desirable Queen Anne Neighborhood of Seattle, Washington | Less than Two Miles from Downtown Seattle

• Ground Floor of a Brand New, 34-Unit Luxury Apartment Complex | 31 Dedicated Parking Stalls for CVS

• CVS Signed a 25-Year Triple-Net (NNN) Lease Featuring Four, Five-Year Option Periods with 10 Percent Escalations in Rent

• Two Blocks West of the Attraction-Heavy Seattle Center | 10 Cultural Facilities, Six Venues, and Over 24 Acres of Open Space

• Dense Infill Location: 223,000 Residents with an Average Household Income of $100,000 Within the Three-Mile Radius

• Seattle Ranks Number Six in Forbes List of The Best Places for Business and Careers

• The Queen Anne Neighborhood Ranked Number Four in the Country on Redfin’s List of Top 24 Affordable and Balanced Mix Neighborhoods Ranked by Walk Score and GreatSchools Score

• Highly Visible Signalized, Hard-Corner Location| Walk Score of 96 and Nearly 40,000 Vehicles Pass Through Intersection Each Day

• High Barrier to Entry | Major Tenants in the Vicinity Include: Bank of America, Safeway, Starbucks, Taco Bell, Chase Bank, Key Bank, FedEx, UPS, and Many More

Marcus & Millichap is pleased to present this newly constructed 15,971-square foot 24-Hour CVS Pharmacy located in the heart of the desirable Queen Anne neighborhood of Seattle, Washington. Located less than two miles north of Downtown Seattle, this CVS is situated on the ground floor of a brand new, 34-unit luxury apartment complex. CVS agreed to a 25-year, triple-net (NNN) lease with 10 percent escalations in rent in each of the four, five-year option peri-ods. The lease is backed by CVS Caremark Corporation, a publicly traded company (New York Stock Exchange: CVS) that ranks number seven in the Fortune 500.

This highly visible CVS is located just two blocks west of Seattle Center on the signalized, hard-corner intersection of West Mercer Street and Queen Anne Avenue. Nearly 40,000 vehicles pass through the intersection each day. This lo-cation also features excellent public transit and a Walk Score of 96 out of 100, making it a walker’s paradise since daily errands do not require a car.

The subject property sits two blocks west of Seattle Center in the neighborhood of Queen Anne. In early 2016, Queen Anne ranked number four in the country on Redfin’s list of Top 24 Affordable and Balanced Mix Neighborhoods Ranked by Walk Score and GreatSchools Score. This CVS is located in a dense market with a high barrier to entry. The three-mile radius features ideal demographics, with 223,000 residents with an average household income (AHHI) of $100,000.

QUEEN ANNE AVE N

18,400 VPD

W MERCER ST21,100 VPD



PRICE $19,500,000 CAP RATE 4.52%NOI $880,481 PRICE PER SQUARE FOOT $1,220.96 RENT PER SQUARE FOOT $55.13 YEAR BUILT 2016LOT SIZE +/- 0.28 AcresGROSS LEASEABLE AREA 15,971TYPE OF OWNERSHIP PublicLEASE GURANTOR Corporate GuaranteeLEASE TYPE Triple-Net (NNN)ROOF AND STRUCTURE Tenant Responsible

LOAN AMOUNT $11,700,000 LOAN TO VALUE 60%FIXED TERM 10-YearTERM 10-YearAMORTIZATION PERIOD 30-YearINDEX 10-Year SWAPINDEX AS OF 10/03/16 1.44%SPREAD 260 BPSINTEREST RATE AS OF 10/03/16 4.04%RECOURSE Non-RecoursePREPAY 4-3-2-1-0…%RESERVES (PSF) NoneLENDER ORIGINATION FEE Par

Financia l Overv iew

Offer ing Summary

Acqu is i t ion F inanc ing

Actual Property

QUEEN ANNE AVE N

18,400 VPD

W MERCER ST

21.100 VPD



Lease Overv iew

LEASE COMMENCEMENT DATE October 1, 2016LEASE EXPIRATION DATE January 31, 2042LEASE TERM 25TERM REMAINING 25INCREASES 10% in Each Option PeriodOPTIONS TO RENEW Four, Five-Year OptionsOPTIONS TO TERMINATE NoneOPTIONS TO PURCHASE NoneFIRST RIGHT OF REFUSAL None

Lease Summary

Actual Property

QUEEN ANNE AVE N

18,400 VPD W MERCER ST

21,100 VPD

Base Rent Annual Annual/SF Increase

Years 1-25 $880,481 $55.13

Options

Years 26-30 $968,529 $60.64 10%

Years 31-35 $1,065,382 $66.71 10%

Years 36-40 $1,171,921 $73.38 10%

Years 36-41 $1,289,113 $80.72 10%



Tenant Overview - CVS Pharmacy

CVS Health Corporation, together with its subsidiaries, is a pharmacy innovation company helping people on their path to better health. At the forefront of a changing health care landscape, the Company has an unmatched suite of capabilities and the expertise needed to drive innovations that will help shape the future of health.

We are currently the only integrated pharmacy health care company with the ability to impact consumers, payors, and providers with innovative, channel-agnostic solutions to complex challenges managing costs and care. We have a deep understanding of their diverse needs through our unique integrated model, and we are bringing them innovative solutions that help increase access to quality care, deliver better health outcomes and lower overall health care costs.

Through our nearly 10,000 retail pharmacies, more than 1,100 walk-in medical clinics, a leading pharmacy benefits manager with nearly 80 million plan members, a dedicated senior pharmacy care business serving more than 1 million patients per year, and expanding specialty pharmacy services, we enable people, businesses and communities to manage health in more affordable, effective ways. We are delivering break-through products and services, from advising patients on their medications at our CVS Pharmacy locations, to introducing unique programs to help control costs for our clients at CVS Caremark, to innovating how care is delivered to our patients with complex conditions through CVS Specialty, to improving pharmacy care for the senior community through Omnicare, or by expanding access to high-quality, low-cost care at CVS MinuteClinic.

TENANT TRADE NAME CVS HealthOWNERSHIP Public

TENANT Corporate Store

LEASE GUARANTOR Corporate Guarantee

NUMBER OF LOCATIONS 9,900+

HEADQUARTERED Woonsocket, Rhode Island

WEB SITE www.cvs.com

SALES VOLUME $153 Billion (2015)

NET WORTH $37.2 Billion (2015)

STOCK SYMBOL CVS

BOARD New York Stock Exchange (NYSE)

CREDIT RATING BBB+

RATING AGENCY Standard & Poor S&P

RANK #7 in Fortune 500 (June 2016)

TENANT PROFILE



Local Area Overv iew

DOWNTOWN SEATTLE

SPACE NEEDLE

KEY ARENA

CENTURY LINK STADIUMMEDITERRANEAN INN

MARQUEEN HOTEL

INN AT QUEEN ANNE

EXPO APTS

TRIBECA CONDOS

525 FIRST WEST APTS

EMP MUSEUM

Downtown Seattle is the city’s central business district and is the largest employment center in the Pudget Sound region

accounting for half the city’s jobs and 21% of King County jobs.

TOURIST ATTRACTION1,000,000+ Visitors Per Year

0.5 Miles From Subject Property

TOURIST ATTRACTIONMulti-Purpose Arena with 15,000+ Seating Capacity


TOURIST ATTRACTIONSeating Capacity Over 70,000

2.34 Miles From Subject PropertyHotel 180 Rooms

Hotel 56 Rooms

Hotel 68 Rooms

MIXED-USE 6-Story275 Residential Units

MIXED-USE 4-Story51 Condos

MIXED-USE 4-Story41 Condos

TOURIST ATTRACTION500,000+ Visitors Per Year


Home to the following Fortune 500 Companies:

SITE



Local Area Overv iew

NORTH

5

5

18

,40

0 V

PD

216,000

60,2

00 V

PD

64,800 VPD

Que

en A

nne

Ave

N

Inte

rsta

te-5

Alaskan Way Viaduct

El l iott Ave W

21,100 VPDMercer St

CVS

11 W Mercer StSeattle, WA 98119

Seattle Center

Safeco Field

CenturyLink Field



90

90

90

5

5

5

405

405

405

202

202

520520

522

304

304

303

308

305

305

305

509

99

99

5 MILE

RADIUS

3 M

ILE R

ADIUS

1 MIL

E

SITE

KIRKLAND

REDMOND

BELLEVUE

NEWCASTLE

FORT WARD

PORT BLAKELY

VENICE

AGATE POINT

KEYPORT

BROWNSVILLE

TRIKKALA

ILLAHEE

ENETAI

SHERIDAN

BREMERTON

MANCHESTER

PORT ORCHARD

PARKWOOD

MEDINA

CLYDE HILL

YARROW POINT

MERCERISLAND

UNIVERSITY OF WASHINGTON

KING COUNTY INTER-NATIONAL AIRPORT

SEATTLE

BAINBRIDGEISLAND

Area Overview & Demographics

1-Mile 3-Mile 5-Mile

P o p u l a t i o n

2000 Population 25,517 168,896 350,937

2010 Population 32,347 188,751 384,826

2016 Population 40,193 222,877 438,587

2021 Population 44,232 243,388 476,384


H o u s e h o l d s

2000 Households 16,540 90,088 171,920

2010 Households 21,037 103,173 191,358

2016 Households 25,500 121,103 216,063

2021 Households 27,984 132,258 234,569


H o u s e h o l d ( H H ) I n c o m e s

2016 Average HH Income $105,469 $99,707 $102,918

2016 Median HH Income $82,092 $72,419 $75,414

2016 Per Capita Income $66,914 $54,177 $50,701


Market Overv iew - Lower Queen Anne

THE QUEEN ANNE/LOWER QUEEN ANNE NEIGHBORHOOD IS AMONG THE MOST AFFLUENT IN SEATTLE, LOCATED NEAR THE DOWNTOWN AREA AND HAS A POPULATION OF APPROXIMATELY 28,000.Lower Queen Anne is easily accessible from Interstate 5 via the Mercer Street exit and has several main thoroughfares collectively known as Queen Anne Boulevard. Queen Anne is among the closest neighborhoods to downtown Seattle, well within walking distance.

Lower Queen Anne runs up on the Seattle Center, where the Space Needle, Key Arena, and other iconic Seattle landmarks are located. Queen Anne is also home to 29 official Seattle landmarks, making it a top tourist attraction in the city. Seattle Pacific University is also located in Queen Anne, and its students contribute to the area’s vibrant nightlife. The neighborhood has a walkability score of 95, so while tens of thousands of cars pass through every day, it also has plenty of foot traffic.

This highly visible CVS is located just two blocks west of Seattle Center on the signalized, hard-corner intersection of West Mercer Street and Queen Anne Avenue, and includes 31 dedicated parking spots. The stretch of Queen Anne Ave the CVS is located on serves as the backbone of the central business district.

New construction projects are underway across the neighborhood, and several new residential buildings have been put up in recent years. The median income is $64,000, above the average for Seattle, which is itself above the average for Washington State, which is in turn above the average for the United States.

LOWER QUEEN ANNE

SITE


Market Overv iew - Seatt le , Washington

Actual Property

EconomySeattle is one of America’s fastest growing cities. It grew by 2.3 percent in 2015, among the top five fastest growing cities in the United States. A highly skilled and educated workforce, advanced transportation and distribution infrastruc-ture, manufacturing capabilities and access to national and global markets have contributed to its economic diversity. Five Fortune 500 companies have head-quarters within Seattle’s city limits—Amazon, Starbucks, Nordstrom, Expedi-tors, and Alaska Air—and four others, including Costco and Microsoft, call the broader metro area home. They are all major employers in the region, and four out of ten jobs in the entire state are connected to international trade in part be-cause of the Port of Seattle, one of the busiest ports in the United States. Seat-tle has a mix of established companies and exciting up-and-comers. Microsoft operates out of nearby Redmond, while Seattle itself is home to fast-growing industries like e-commerce and biomedical tech. Start-ups in these industries can thrive because of Seattle’s strong entrepreneurial culture, the presence of venture capital, and local assets like the University of Washington, the Fred Hutchinson Cancer Research Center, the Allen Institute for Brain Science, and even Amazon, all located within the city limits of Seattle.

Labor

This year, Washington State ranked first in combined job and wage growth, driven in large part by gains in the Seattle area, which has seen steady job growth during the eco-nomic recovery. Construction-related jobs led in growth, with a 4.6 percent increase in King County (where Seattle is located) in 2015, above the national average. The expanding biomedical field will increase employment in the education and health services sector by nearly 2 percent per year through 2020. Professional/business services also saw above-average gains in King. This sector is expected to grow by an annual average of 3.3 percent, or by a total of 48,400 jobs, during this period.

The Seattle area outpaced national employment growth in the last five years, and is expected to do so through 2020, expanding 1.5 percent annually. Approximately 37.7 percent of the population over the age of 25 hold at least a bachelor’s degree, compared with just under 28.8 percent nationwide.

MAJOR EMPLOYERS

• Boeing

• Microsoft

• University of Washington

• Amazon

• Walmart

• Starbucks

• Wyerhaueser

• Fred Meyer

• King County Government

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. Marcus & Millichap is a trademark of © 2016 Marcus & Millichap. All rights reserved. Activity ID # X0331883 | Broker of Record: Joel Deis Lic: 25469

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