UNIQUE GROCERY ANCHOR INVESTMENT OPPORTUNITY1 5 1 6 E V A L L E Y PA R K W AY, E S C O N D I D O , C A L I F O R N I A 9 2 0 2 7 ( S A N D I E G O M S A )

ACTUAL SITE

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EXCLUSIVELY MARKETED BY

JACK QASHAT | ASSOCIATESRS NATIONAL NET LEASE GROUP

3131 Camino Del Rio N, Suite 310 | San Diego, California 92108DL: 619.489.9002 | M: 619.354.5225

Jack.Qashat@srsre.com | CA License No. 01914468

SAM HANNA | SENIOR VICE PRESIDENTSRS NATIONAL NET LEASE GROUP

3131 Camino Del Rio N, Suite 310 | San Diego, California 92108 DL: 619.489.9003

Sam.Hanna@srsre.com | CA License No. 01242719

ACTUAL SITE

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Responsible Broker: Garrett Colburn, SRS Real Estate Partners CA License No. 01416734

TABLE OF CONTENTS

4INVESTMENT SUMMARY

OFFERING SUMMARY | INVESTMENT HIGHLIGHTS

7PROPERTY OVERVIEW

AERIALS | SITE PLAN | LOCATION MAP

12AREA OVERVIEW

DEMOGRAPHICS

14FINANCIALS

RENT ROLL | BRAND PROFILE

ACTUAL SITE

SRS National Net Lease Group is pleased to offer the opportunity to acquire the leased fee interest (land ownership) in a NN leased, corporate guaranteed, Grocery Outlet, investment property located in Escondido, CA (San Diego MSA). The tenant, Grocery Outlet Inc., has approximately 4 years remaining on its initial 10-year lease term with 4 (5-year) options to extend. The lease features a 10% rental increase at the beginning of the sixth year of the lease term and at the beginning of each option period, steadily growing NOI and hedging against inflation. The lease is corporate guaranteed and is NN with limited landlord responsibilities. This offering also includes a freestanding building behind Grocery Outlet - contact agent for more details.

The subject property is located near the signalized hard corner intersection of E. Valley Parkway and N. Rose St., averaging a combined 39,300 vehicles passing by each day. The site has a large monument sign, providing for excellent visibility and street frontage on E. Valley Parkway. Moreover, it is located a half-mile away from State Highway 78 (20,400 VPD) and about 3 miles away from Interstate 15, the major north/south thoroughfare going through Escondido, averaging 238,000 vehicles passing each day. Grocery Outlet is in the heart of a dense retail corridor, with nearby national/credit tenants including Walmart, Walmart Neighborhood Market, The Home Depot, Dollar Tree, CVS Pharmacy, Bank of America, Joann’s, and more, increasing consumer draw to the trade area and promoting crossover shopping to the site.

Escondido is a bedroom community of San Diego, one of the most populated cities in the state of California, second only to Los Angeles. The subject property is about 15 minutes from the San Diego Zoo Safari Park, which reports over 1.2 million visitors annually. The site is also located about 15 minutes away from California State University of San Marcos, which currently has more than 13,000 undergraduate students enrolled. More locally, the 5-mile trade area is supported by nearly 192,000 residents with an affluent average annual household income of $86,662.

4 | INVESTMENT SUMMARY | SRS NATIONAL NET LEASE GROUP .

INVESTMENT SUMMARY

ACTUAL SITE

5 | OFFERING HIGHLIGHTS | SRS NATIONAL NET LEASE GROUP .

ACTUAL SITE

OFFERING SUMMARY

RENTABLE AREA: 16,033 SF + Additional BuildingContact Agent for Details

LAND AREA: 1.49 Acres

PROPERTY ADDRESS: 1516 E. Valley Parkway, Escondido, CA 92027

YEAR BUILT / REMODELED: 1990

PARCEL NUMBER: 230-141-19-00

OWNERSHIP: Fee Simple (Land and Building)

PROPERTY SPECIFICATIONS

PRICING: $4,450,000

NET OPERATING INCOME: $270,864

CAP RATE: 6.09%

GUARANTY: Corporate

TENANT: Grocery Outlet Inc.

NUMBER OF LOCATIONS: 300+

LEASE TYPE: NN

LANDLORD RESPONSIBILITIES: Roof, Structure, HVAC, Parking Lot beg. Year 8

OFFERING

INVESTMENT HIGHLIGHTSUNIQUE INVESTMENT OPPORTUNITY: GROCERY OUTLET AND A FREE STANDING RETAIL BUILDING

• Grocery Outlet corporate guaranteed lease with 4 years remaining and 4 (5-year) option periods

• 10% rental increases every 5 years• Contact agent for details regarding second building

NN LEASE | FEE SIMPLE OWNERSHIP | LIMITED LANDLORD RESPONSIBILITIES• Tenant pays for CAM, taxes, insurance• Landlord responsibilities limited to Roof, Structure, and HVAC• Landlord is responsible for Parking Lot at the start of year 8 of the term• Ideal, low management investment for an out-of-state, passive investor

NEARBY SIGNALIZED, HARD CORNER INTERSECTION | STATE HIGHWAY 78 | INTERSTATE 15

• Situated near the signalized, hard corner intersection of E Valley Parkway and N. Rose St., averaging a combined 39,300 vehicles passing by daily

• Less than a half mile away from State Highway 78 with 20,400 VPD• About 3 miles from Interstate 15, the major north/south thoroughfare going through

Escondido, averaging over 238,000 VPD• Located in a high-traffic trade area with a large monument sign, providing excellent

visibility

DENSE RETAIL CORRIDOR | NEARBY NATIONAL/CREDIT TENANTS• Nearby national/credit tenants including Walmart, Walmart Neighborhood Market,

The Home Depot, Dollar Tree, CVS Pharmacy, Bank of America, Joann’s, and more• Increases consumer draw to the trade area and promotes crossover shopping

CALIFORNIA STATE UNIVERSITY SAN MARCOS | PALOMAR COLLEGE• Site is located about 15 minutes from California State University of San Marcos

(13,000 students)• Site is located a half-mile from a Palomar College satellite campus• Provides a direct consumer base to draw from

BEDROOM COMMUNITY OF SAN DIEGO | SAN DIEGO ZOO SAFARI PARK• Escondido is a bedroom community of San Diego, one of the most populated cities

in California, second only to Los Angeles• Subject property is located 15 minutes away from the San Diego Zoo Safari Park,

which reports over 1.2 million visitors each year

STRONG DEMOGRAPHICS IN 5-MILE TRADE AREA • Nearly 192,000 residents and more than 72,000 employees• Affluent average annual household income of $86,662

6 | INVESTMENT HIGHLIGHTS | SRS NATIONAL NET LEASE GROUP .

ACTUAL SITE

7 | PROPERTY OVERVIEW | SRS NATIONAL NET LEASE GROUP .

PARCEL MAP

PROPERTY OVERVIEW

ACTUAL SITE

ACCESS

TRAFFIC COUNTS

IMPROVEMENTS

PARKING

YEAR BUILT

PARCEL

ZONING

E. Valley Parkway: .............................................................................2 Access Points

E. Valley Parkway: .....................................................................27,400 Cars Per DayN. Ash Street / State Highway 78: .............................................20,400 Cars Per Day

There is approximately 16,033 SF of existing building area.

There are approximately 71 parking spaces on the owned parcel. The parking ratio is approximately 4.43 stalls per 1,000 SF of leasable area.

1990

Parcel Number: 230-141-19-00 Acres: 1.49 Square Feet: 64,904 SF

C-G: General Commercial

E. Valley Pkwy.

27,400CARS PER DAY®

Pioneer Elementary

School

Rose Elementary School

Escondido Charter High School

Palomar College

Orange Glen High School PTSO

Hidden Valley Middle School

Oak Hill Elementary School

20,400CARS PER DAY

11,900CARS PER DAY

27,400CARS PER DAY

E. Valley Pkwy.

N. Rose St.

State Highway 78

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VALLEY PKWY. - 27,400 VPD

MONUMENT SIGN

VALLEY ROSE SELF STORAGE

TORTILLERIA SANTACRUZ

NEIGHBORHOOD HEALTHCARE

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SAN DIEGO

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35 Minutes | 34 Miles To San Diego

ESCONDIDO

2018 ESTIMATED POPULATION1 Mile ......................................................... 41,6693 Mile ........................................................137,2495 Mile ........................................................191,809

2018 AVERAGE HOUSEHOLD INCOME1 Mile ........................................................$60,027 3 Mile ........................................................$74,1145 Mile ........................................................$86,662

2018 ESTIMATED TOTAL EMPLOYEES1 Mile ......................................................... 13,7393 Mile ......................................................... 50,0885 Mile ......................................................... 72,028

12 | AREA OVERVIEW | SRS NATIONAL NET LEASE GROUP .

AREA OVERVIEWEscondido, CaliforniaEscondido is settled in a long valley in the coastal mountains of Southern California, Escondido provides a thriving urban environment in the midst of gentle rolling hills and avocado and citrus groves. Escondido lies about 18 miles inland, 100 miles south of Los Angeles, and 30 miles northeast of San Diego. The City of Escondido is a vibrant and diverse community with a population of 155,233 as of July 1, 2018.

Escondido’s economy is one of the most diversified in North San Diego County. Industries such as healthcare, specialty food and beverage manufacturing, agriculture, professional services and precision manufacturing all call Escondido home. Retail sales are among the highest in San Diego County due to the presence of the Escondido Auto Park and Westfield North County. Palomar Medical Center, which opened its doors in the Escondido Research and Technology Center in 2012, is the centerpiece of the region’s health care system and is recognized as one of the most technologically advanced hospitals in the world. Escondido is home to dozens of innovative companies and entrepreneurs, with one of the highest numbers of recorded patents per capita in the nation.

Inland North San Diego County, of which Escondido is at the core, is emerging as a regional economic leader in the forefront of job development and new industries. Escondido is a wonderful place to visit, live, work, play, or do business, and provides a business-friendly environment.

According to the City’s 2017 Comprehensive Annual Financial Report, the top employers in the city are Palomar Medical Center, Escondido Union School District, City of Escondido, Escondido Union High School District, Bergelectric, Home Depot, Nordstrom Inc., Toyota of Escondido, Vons Grocery Stores, California Center for the Arts, North County Transit District and SDG&E.

Escondido, California provides easy access to all of the many cultural, arts and entertainment offerings of nearby San Diego. In addition, some of Escondido’s more notable attractions include The California Center for the Arts, The Deer Park Winery and Auto Museum, The Escondido Children’s Museum, The Mingei International Museum, The Patio Playhouse, The San Pasqual Battlefield State Park, Theatrx, The Lawrence Welk Museum and The Welk Resort Theatre.

Escondido is served by the Escondido Union School District, the Escondido Union High School District, and the San Pasqual Union School District. The city has 19 elementary, five middle, and seven high schools.

13 | AREA DEMOGRAPHICS | SRS NATIONAL NET LEASE GROUP .

AREA DEMOGRAPHICSDEMOGRAPHICS 1 MILE 3 MILES 5 MILES

2018 Estimated Population 41,669 137,249 191,8092023 Projected Population 43,330 143,271 200,2332010 Census Population 38,818 127,226 177,342Projected Annual Growth 2018 to 2023 0.78% 0.86% 0.86%Historical Annual Growth 2010 to 2018 0.86% 0.92% 0.96%

2018 Estimated Households 11,361 41,520 61,1892023 Projected Households 11,752 43,184 63,6742010 Census Households 10,782 38,968 57,110Projected Annual Growth 2018 to 2023 0.68% 0.79% 0.80%Historical Annual Growth 2010 to 2018 0.64% 0.77% 0.84%

2018 Estimated White 50.8% 55.4% 60.4%2018 Estimated Black or African American 2.6% 2.5% 2.3%2018 Estimated Asian or Pacific Islander 4.4% 6.2% 6.8%2018 Estimated American Indian or Native Alaskan 1.3% 1.1% 0.9%2018 Estimated Other Races 36.3% 30.0% 24.7%2018 Estimated Hispanic 68.8% 56.7% 47.8%

2018 Estimated Average Household Income $60,027 $74,114 $86,6622018 Estimated Median Household Income $45,755 $52,966 $60,0802018 Estimated Per Capita Income $17,300 $23,083 $28,142

2018 Estimated Total Businesses 818 4,198 6,2152018 Estimated Total Employees 13,739 50,088 72,028

RENT ROLL

14 | RENT ROLL | SRS NATIONAL NET LEASE GROUP .

ACTUAL SITE

For financing options and loan quotes, please contact our SRS Debt & Equity team at debtequity-npb@srsre.com.

LEASE TERM RENTAL RATES

TENANT NAME SQUARE FEET LEASE START LEASE END BEGIN INCREASE MONTHLY PSF ANNUALLY PSF RECOVERY TYPE OPTIONSGrocery Outlet 16,033 7/5/2013 7/31/2023 Current - $23,889 $1.49 $286,668 $17.88 NN 4 (5-year)

(Corporate Guaranty) 12% incr. at beg.

of each option

FINANCIAL INFORMATION PROPERTY SPECIFICATIONS

Price: ..................................................................................................................................$4,450,000Net Operating Income: ..........................................................................................................$270,864Cap Rate: ....................................................................................................................................6.09%Lease Type:..................................................................................................................................... NN

Year Built: .....................................................................................................................................1999Rentable Area: ........................................... 16,033 SF + Additional Building (Contact Agent for Details)Land Area: ........................................................................................................................... 1.49 AcresAddress: ........................................................................ 1516 E. Valley Parkway, Escondido, CA 92027

PRICING SUMMARY

15 | RENT ROLL | SRS NATIONAL NET LEASE GROUP .

ACTUAL SITE

OPERATING CASH FLOW IN-PLACERental Revenue: $286,668

Reimbursement Revenue: 1 , 5 $69,767

Gross Potential Revenue: $356,435

Less Expenses: ($85,571)

Net Operating Income: $270,864

OPERATING EXPENSES IN PLACETaxes: 2 $51,327

Special Assessments: 2 $66

Insurance: 3 $7,804

CAM: 1 , 4 $26,374

Total: $85,571

NOTES1) Grocery Outlet had a CAM cap of $1.25/SF for the first 5 years of the term, which cannot increase by more than 8% each year moving forward from Oct. 2018.

2) Taxes and Special Assessments are adjusted for increase upon sale.

3) Insurance expenses are per the seller.

4) CAM expenses are per the seller.

5) Reimbursements are per the seller.

6) Contact agent for details regarding second building.

16 | BRAND PROFILE | SRS NATIONAL NET LEASE GROUP .

BRAND PROFILE

ACTUAL SITE

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GROCERY OUTLETGrocery Outlet is a third-generation family run business, recognized as the nation’s largest grocery extreme-value retailer. Founded in the 1940s, Grocery Outlet currently operates over 300+ independently operated stores in California, Idaho, Nevada, Oregon, Pennsylvania, and Washington. Grocery Outlet offers products ranging from groceries, frozen foods, deli selections, refrigerated goods, produce, fresh meat (selected stores), seasonal products, housewares, toys, health & beauty, gifts and a wide variety of beer and wine.

Company Type: ............................................................................... Private Locations: .......................................................................................... 300+Website: ................................................................www.groceryoutlet.com

1000+PROPERTIES CURRENTLY

REPRESENTED

$2.6B*TRANSACTION VALUE

600+CLIENTS REPRESENTED

IN 2016

250+BROKERS,

PROFESSIONALS,AND STAFF

#1LARGEST REAL ESTATE FIRM

EXCLUSIVELY DEDICATED TO RETAIL SERVICES IN NORTH AMERICA

20+OFFICES

*STATISTICS ARE FOR 2017.

SRS GLOBAL STATS

This Offering Memorandum has been prepared by SRS National Net Lease Group (SRS) and has been approved for distribution by the owner. Although effort has been made to provide accurate information, neither the owner nor SRS can warrant or represent accuracy or completeness of the materials presented herein or in any other written or oral communications transmitted or made available to the purchaser. Many documents have been referred to in summary form and these summaries do not purport to represent or constitute a legal analysis of the contents of the applicable documents. Neither owner nor SRS represents that this offering summary is all inclusive or contains all of the information a purchaser may require. All of the financial projections and/or conclusions presented herein are provided strictly for reference purposes and have been developed based upon assumptions and conditions in effect at the time the evaluations were undertaken. They do not purport to reflect changes in the economic performance of the property or the business activities of the owner since the date of preparation of this Offering Memorandum. The projected economic performance of the property, competitive submarket conditions, and selected economic and demographic statistics may have changed subsequent to the preparation of the package. Qualified purchasers are urged to inspect the property and undertake their own independent evaluation of the property, the market and the surrounding competitive environment.

ACTUAL SITE