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OFFERING MEMORANDUM

WALGREENS15250 MONTANUS DRIVECULPEPER, VIRGINIA 22701

2 WALGREENS CORPORATION CULPEPER, V IRGINIA

OFFERING MEMORANDUM

This Memorandum does not constitute a representation that the business or affairs of the

Property or Seller since the date of preparation of this Memorandum have remained the

same. Analysis and verification of the information contained in this Memorandum are solely

the responsibility of the prospective purchaser.

Additional information and an opportunity to inspect the Property will be made available upon

written request of interested and qualified prospective purchasers. Seller and Agent each

expressly reserve the right, at their sole discretion, to reject any or all expressions of interest

or offers regarding the Property, and/or terminate discussions with any party at any time

with or without notice. Seller reserves the right to change the timing and procedures for the

Offering process at any time in Seller’s sole discretion. Seller shall have no legal commitment

or obligations to any party reviewing this Memorandum, or making an offer to purchase the

Property, unless and until such offer is approved by Seller, and a written agreement for the

purchase of the Property has been fully executed and delivered by Seller and the Purchaser

thereunder.

This Memorandum and the contents, except such information which is a matter of public record

or is provided in sources available to the public, are of a confidential nature. By accepting this

Memorandum, you agree that you will hold and treat it in the strictest confidence, that you will

not forward, photocopy or duplicate it, that you will not disclose this Memorandum or any of

the contents to any other entity (except to outside advisors retained by you, if necessary, for

your determination of whether or not to make a proposal and from whom you have obtained

an agreement of confidentiality) without the prior written authorization of Seller or Agent,

and that you will not use this Memorandum or any of the contents in any fashion or manner

detrimental to the interest of Seller or Agent.

NET LEASE PRACTICE GROUPKEN HEDRICKExecutive Managing Director [email protected]

JERRY HOPKINSSenior Managing Director [email protected]

SUPPORT

D. ANDREW RAGSDALE, Esq.Senior Managing Director [email protected]

JEN BLADENSenior Marketing [email protected]

KEZIA BELFIELDAdministrative [email protected]

GARRETT HUIEFinancial [email protected]

DEBT & EQUITY FINANCEDUSTIN STOLLYVice Chairman, Co-Head New York Debt/Structured [email protected]

JORDAN ROESCHLAUBVice Chairman, Co-Head New York Debt/Structured [email protected]

WALGREENS15250 MONTANUS DRIVE | CULPEPER, VIRGINIA 22701

MAT ADLERManaging Director202.664.5912 [email protected] VA RE Lic. #0225051130

mailto:[email protected]




THE INVESTMENT

5 THE OFFERING

INVESTMENT HIGHLIGHTS

6 LEASE ABSTRACT

RENT SCHEDULE

8 TENANT OVERVIEW

CULPEPER, VIRGINIA

10 LOCATION OVERVIEW

12 DEMOGRAPHICS


THE INVESTMENT


THE OFFERINGNewmark Knight Frank Net Lease Practice Group has been retained to exclusively offer the opportunity to purchase the Walgreens Co. leased retail property located at 15250 MONTANUS DRIVE CULPEPER, VA 22701.

The Subject Property is located in the heart of the Culpeper market, and amongst many other national credit tenant retailers, including Lowes, Wal-Mart, Target, Kohls, Aldi, Chick-fil-A, Starbucks, and Panera. The property is 100% Leased and Guaranteed by Walgreens Co., under a long term Absolute NNN Lease, with zero landlord responsibilities. There are 15+ years remaining of primary lease term, which is accompanied by fifty (50), one (1) year option periods.

INVESTMENT HIGHLIGHTS• Long Term Lease – 15+ Years of Remaining Primary Lease Term.

• 100% Absolute NNN Lease – The Subject Property boasts a true absolute NNN lease, with zero landlord responsibilities.

• Metro/Amtrak Serviced Market – Culpeper is served by the DC Metro and Amtrak rail service lines, increasing crucial accessibility to the Washington D.C. metropolitan area, as well as the Amtrak Northeast Corridor.

• High Growth Market – the Culpeper market provides for a dense suburban demographic, with an expected population growth of 8% between now and 2020.

• Premier Retail Location – Walgreens benefits from a premier location, within the heart of Culpeper’s primary retail corridor.

• Institutional Quality Construction – the subject property includes a high end masonry construction, with strong exposure in an institutional shopping center setting.

• Performing Unit, with Drive Thru – The Subject Property has strong sales, and provides consumers with convenient drive thru service.

PURCHASE PRICE $7,850,000CAP RATE 6.00%


LEASE ABSTRACTProperty Address 15250 Montanus Drive, Culpeper, VA 22701Tenant Walgreen Corporation (S&P: BBB)Effective Date October 18, 2007Rent Commencement Date April 1, 2008Annual Rent $470,000Expiration Date March 31, 2033Option Periods 50, 1 year optionsLease Type Absolute NNN Lease, with zero LL responsibilitiesRight of First Refusal 10 day response periodEstoppel Yes, 30 day response period Rentable Building Area 14,673 SFAcreage 2.0215 AcresConstruction Type MasonryYear Built 2008

RENT SCHEDULECurrent – March 31, 2018 $470,000April 1, 2018 – March 31, 2019 $470,000April 1, 2019 – March 31, 2020 $470,000April 1, 2020 – March 31, 2021 $470,000April 1, 2021 – March 31, 2022 $470,000April 1, 2022 – March 31, 2023 $470,000April 1, 2023 – March 31, 2024 $470,000April 1, 2024 – March 31, 2025 $470,000April 1, 2025 – March 31, 2026 $470,000April 1, 2026 – March 31, 2027 $470,000April 1, 2027 – March 31, 2028 $470,000April 1, 2028 – March 31, 2029 $470,000April 1, 2029 – March 31, 2030 $470,000April 1, 2030 – March 31, 2031 $470,000April 1, 2031 – March 31, 2032 $470,000April 1, 2032 – March 31, 2033 $470,000Option Periods – 50, 1 year options $470,000

10.00'5.00'

75' B

RL

0.47' CLR

0.62' CLR

SITE SURVEY



TENANTOVERVIEW

Walgreens Boots Alliance, Inc. is an American holding company headquartered in Deerfield, Illinois that owns

Walgreens, Boots and a number of pharmaceutical manufacturing, wholesale and distribution companies. The

company was formed on December 31, 2014 after Walgreens purchased the 55% stake in Switzerland-based

Alliance Boots that it did not already own. Walgreens had previously purchased 45% of the company in 2012 with

an option to purchase the remaining shares within three years. The combined business has operations in over 25

countries. Walgreens had formerly operated solely within the United States and its territories, while Alliance Boots

operated a more international business.

The Walgreen Company (simply Walgreens) is an American company which operates as the second-largest

pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and

wellness products, health information, and photo services. As of August 31, 2016, the company operated 8,175

stores in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. It was founded in

Chicago, Illinois, in 1901. The Walgreens headquarters office is in the Chicago suburb of Deerfield, Illinois.

Trade Name Walgreens

Industry Drug Store/Retail

Founded 1901

Headquarters Deerfield, IL

2017 Revenues $117 Billion

2017 Net Income $4.17 Billion

2017 Net Worth $22.88 Billion

Credit Summary


CULPEPER, VIRGINIA

CULPEPER, VIRGINIA is located in the Central Virginia region and is an hour south of Washington D.C. and 40 minutes north of Charlottesville. Rapid population growth in Culpeper is fueled by the proximity to Washington D.C. and Charlottesville and the beauty of the Blue Ridge Mountains. The County of Culpeper was one of the fastest growing counties in the state experiencing over 36% population growth from 2000 to 2010 and is projected to grow an additional 18% by 2020. Among its many attributes, Culpeper boasts a skilled and educated workforce, exceptional real estate values, abundant and reliable power, robust fiber optics and an outstanding quality of life. These advantages attract innovative corporations and government entities to the Culpeper area.

WASHINGTON, D.C., formally the District of Columbia and commonly referred to as “Washington”, “the District”, or simply “D.C.”, is the capital of the United States. Washington had an estimated population of 681,170 as of July 2016. Commuters from the surrounding Maryland and Virginia suburbs raise the city’s population to more than one million during the workweek. The Washington metropolitan area, of which the District is the principal city, has a population of over 6 million, the sixth-largest metropolitan statistical area in the country. Washington has a growing, diversified economy with an increasing percentage of professional and business service jobs.[The gross product of the Washington Metropolitan Area was $435 billion in 2014, making it the sixth-largest metropolitan economy in the United States.

The Packard Campus of the National Audio-Visual Conservation Center is located on 45-acres near Culpeper, Virginia, and 75 miles southwest of Washington, DC near the foothills of the Blue Ridge Mountains. The campus is built into the side of Mount Pony, the highest slope in Culpeper County, and features an adaptive reuse and expansion of a previously existing underground Federal Reserve Bank facility. It was created through a unique partnership between the Packard Humanities Institute, the United States Congress, the Library of Congress and the Architect of the Capitol.



LOCATION AERIAL

N

MONTANNUS DR

MONTANNUS DR

JAMES MADISON HWY (ROUTE 15/29)

IRA HOFFMAN LN

ROCKY KNOLL

BRADFORD RD


1 Mile Ring 5 Mile Ring 10 Mile Ring

POPULATION 2000 Total Population 2,135 16,884 30,9702010 Total Population 3,640 25,434 42,047

2016 Total Population 3,972 27,331 44,8252021 Total Population 4,288 28,933 47,179

HOUSEHOLDS2000 Total Households 755 6,531 11,0622010 Total Households 1,158 9,133 14,6522016 Total Households 1,215 9,407 15,1272021 Total Households 1,324 10,049 16,088

POPULATION2000 to 2010 Population Change 70.5% 50.6% 35.8%2000 to 2016 Population Change 86.0% 61.9% 44.7%2010 to 2021 Population Change 17.8% 13.8% 12.2%2016 to 2021 Population Change 8.0% 5.9% 5.3%

HOUSEHOLD2000 to 2010 Household Change 53.4% 39.8% 32.5%2000 to 2016 Household Change 60.9% 44.0% 36.7%2010 to 2021 Household Change 14.3% 10.0% 9.8%2016 to 2021 Household Change 9.0% 6.8% 6.4%

2016 RACEWhite alone 54.3% 67.2% 72.4%Black or African American alone 22.5% 18.4% 16.4%American Indian and Alaska Native alone 1.3% .5% .5%Asian alone 3.3% 1.9% 1.4%Native Hawaiian and OPI alone .0% .1% .1%Some Other Race alone 13.2% 7.5% 5.5%Two or More Races 5.4% 4.3% 3.7%

2016 INCOMEPer Capita Income $24,010 $25,764 $27,299Household Income: Median $63,220 $59,216 $63,894Household Income: Average $77,049 $74,210 $78,623

AVERAGE HOUSEHOLD SIZE 3.2 2.9 2.9

DEMOGRAPHICS

Old Executive Eisenhower Office Building – The White House


WALGREENS15250 MONTANUS DRIVE | CULPEPER, VIRGINIA 22701

NET LEASE PRACTICE GROUPD. ANDREW RAGSDALE, Esq. Senior Managing Director918.878.9535 [email protected]

JERRY HOPKINSSenior Managing Director918.878.9536 [email protected]

KEN HEDRICKExecutive Managing Director918.878.9540 [email protected]

MAT ADLERManaging Director202.664.5912 [email protected] VA RE Lic. #0225051130


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