christian brothers - knoxville, tn

Knoxville, TN

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The information contained in the following offering memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and it should not be made available to any other person or entity without the written consent of Marcus & Millichap. By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property at this time, please return this offering memorandum to Marcus & Millichap.

This offering memorandum has been prepared to provide summary, unverified financial and physical 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. Marcus & Millichap has not made any investigation, and makes no warranty or representation with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCBs or asbestos, the compliance with local, state and federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this offering memorandum has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap 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. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT THE MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

Confidentiality Agreement

Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows:

The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided.

As the Buyer of a net leased property, it is the Buyer’s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer.

Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors. Buyer and Buyer’s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs.

Like all real estate investments, this investment carries significant risks. Buyer and Buyer’s legal and financial advisors must request and care-fully review all legal and financial documents related to the property and tenant. While the tenant’s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant’s projected sales with little or no record of actual performance, or com-parable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer’s legal ability to make alternate use of the property.

By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property

Net Lease Disclaimer

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Christian Brothers Automotive-Knoxville

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. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2013 Marcus & Millichap ACT ID W0060028

Pricing & Financial Analysis

CBAC - Knoxville10406 Kingston PikeKnoxville, TN 37922

Lease SummaryLease Term 15 YearsLease Commencement At Close of EscrowLease Expiration 15 Yrs From COERemaining Term 15 YearsLease Type NNNRoof & Structure TenantIncreases 1.5% Starting in Yr 6Options 5 x 10 YrOptions to Purchase No

Offering SummaryPrice $2,670,000Cap Rate 6.25%Net Operating Income (NOI) $166,800Year Built 2014Gross Leasable Area (GLA) 4,945 SFLot Size 0.57 AcresFinancing Free & Clear

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Annualized Operating IncomePrimary Term Annual Rent IncreasesYears 1-5: $166,800.00 -Year 6: $169,302.00 1.50%Year 7: $171,841.53 1.50%Year 8: $174,419.15 1.50%Year 9: $177,035.44 1.50%Year 10: $179,690.97 1.50%Year 11: $182,386.34 1.50%Year 12: $185,122.13 1.50%Year 13: $187,898.96 1.50%Year 14: $190,717.45 1.50%Year 15: $193,578.21 1.50%Net Operating Income $166,800.00

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Tenant & Lease Information

Christian Brothers Automotive was founded in 1982 because there was a void in the auto repair industry. Customer service and honest, genuine auto repair service was tough to find. They haven’t changed their focus in thirty years. They still have some of the original employees on board, and they still believe that it’s possible to provide the best auto repair service with the best customer service. In 2008, Christian Brothers announced a growth initiative that would take their brand to approximately 200 stores throughout the southeast, lower midwest and southwest United States by 2017.

Tenant SummaryTenant Christian Brothers AutomotiveOwnership PrivateMarket Cap See Agent For DetailsSales Volume See Agent For DetailsNumber of Locations 125+Years In Business 30+ Years Headquarters Houston, TXWebsite www.cbac.com

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Investment Highlights

Overview• Long-Term Absolute Triple-Net Lease

• Zero Landlord Responsibility

• 15-Year Primary Term with Options up to 50 Years

• One and One-Half Percent Annual Rent Escalations

• Strong Corporate Guarantee

• 5 Mile Population Exceeds 105,000 People - 22% Increase Since 2000

• Average Household Income is 1.25x More Than National Average

• Traffic Counts Exceed 34,000 Vehicles Per Day

Christian Brothers Automotive in Knoxville, Tennessee is a single-tenant, triple-net asset. Built in 2014, the investment contains a 15-year primary term net lease providing zero landlord responsibility. The lease is guaranteed by the corporation and includes one and one-half percent escalations every year beginning in year six, with options up to 65 years. This single-tenant triple-net asset is not only a beautiful design, but each location also serves as an extremely functional automotive repair facility, thus providing an investor with a quality piece of real estate with a strong growing company.

Christian Brothers Automotive Corporation is a national automotive service franchisor headquartered in Houston, Texas. Today, Christian Brothers Automotive has more than 125 locations across 15 states with an annual expansion rate of 15 stores. They are a leading seller of full service automotive repair franchise locations dedicated to providing high quality service and professionalism, while maintaining the highest level of ethical standards. The company targets high growth, upper income markets with significant real estate appreciation potential. In addition, they choose the site foreach franchise location, as well as construct the building and lease the premises to the franchisee.

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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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2013 Marcus & Millichap ACT ID W0060028

Christian Brothers Automotive-KnoxvilleElevation

Note: this is the generic evelation plan for a typical Christian Brothers Automotive location. Actual subject property may vary depending on location.

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Christian Brothers Automotive-KnoxvilleSite Plan

Note: this is the generic site plan for all Christian Brothers Automotive locations. Actual subject property may vary depending on location.

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Christian Brothers Automotive-KnoxvilleAerial Map

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Christian Brothers Automotive-KnoxvilleLocal Map

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Christian Brothers Automotive-KnoxvilleRegional Map

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Christian Brothers Automotive-KnoxvilleMarket Summary

KNOXVILLE, TN

Knoxville had an estimated population of 183,270 in 2013, and a population of 178,874 as of the 2010 census, making it the state’s third largest city. Knoxville is the principal city of the Knoxville Metropolitan Statistical Area, which, in 2013, had an estimated population of 852,715. The KMSA is, in turn, the central component of the Knoxville-Sevierville-La Follette Combined Statistical Area, which, in 2013, had a population of 1,096,961.

Knoxville is the home of the flagship campus of the University of Tennessee, whose sports teams, called the “Volunteers” or “Vols,” are extremely popular in the surrounding area. Knoxville is also home to the headquarters of the Tennessee Valley Authority, as well as the Tennessee Supreme Court’s courthouse for East Tennessee and corporate headquarters of several national and regional companies. As one of

the largest cities in the Appalachian region, Knoxville has positioned itself in recent years as a repository of Appalachian culture, and is one of the gateways to the Great Smoky Mountains National Park.

In the 2010 ACCRA Cost of Living Index, Knoxville was rated 89.6 (the national average was 100).Kiplinger ranked Knoxville at #5 in its list of Best Value Cities 2011 citing “college sports, the Smoky Mountains and an entrepreneurial spirit.” In April 2008, Forbes Magazine named Knoxville among the Top 10 Metropolitan Hotspots in the United States, and within Forbes’ Top 5 for Business & Careers, just behind cities like New York and Los Angeles. In 2007, there were over 19,000 registered businesses in Knoxville. The city’s businesses are served by the 2,100-member Knoxville Area Chamber Partnership.

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Christian Brothers Automotive-KnoxvilleDemographic Summary

Demographic data © 2010 by Experian/Applied Geographic Solutions.

PopulationIn 2013, the population in your selected geography was 105,022. The population has changed by 21.99% since 2000. It is estimated that the population in your area will be 112,708 five years from now, which represents a change of 7.31% from the current year. The current population is 48.8% male and 51.1% female. The median age of the population in your area is 39.8, compare this to the U.S. average which is 37. The population density in your area is 1,366.46 people per square mile.

Households There are currently 42,894 households in your selected geography. The number of households has changed by 24.43% since 2000. It is estimated that the number of households in your area will be 46,272 five years from now, which represents a change of 7.87% from the current year. The average household size in your area is 2.43 persons.

Income In 2013, the median household income for your selected geography is $70,716, compare this to the U.S. average which is currently $53,535. The median household income for your area has changed by 1.23% since 2000. It is estimated that the median household income in your area will be $79,997 fiveyears from now, which represents a change of 13.12% from the current year. The current year per capita income in your area is $38,888, compare this to the U.S. average, which is $28,888. The current year average household income in your area is $95,104, compare this to the U.S. average which is $75,373.

Race and Ethnicity The current year racial makeup of your selected area is as follows: 88.09% White, 4.00% African American, 0.27% Native American and 4.43% Asian/Pacific Islander. Compare these to U.S. averages which are: 72.20% White, 12.65% African American, 0.96% Native American and 5.01% Asian/Pacific Islander. People of Hispanic origin are counted independently of race. People of Hispanic origin make up 4.03% of the current year population in your selected area. Compare this to the U.S. average of 16.55%.

Housing The median housing value in your area was $161,673 in 2000, compare this to the U.S. average of $110,781 for the same year. In 2000, there were 25,724 owner occupied housing units in your area and there were 8,468 renter occupied housing units in your area. The median rent at the time was $622.

Employment In 2013, there are 58,979 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed that 78.6% of employees are employed in white-collar occupations in this geography, and 21.3% are employed in blue-collar occupations. In 2013, unemployment in this area is 2.93%. In 2000, the median time traveled to work was 22.5 minutes.

Geography: 5 Miles

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Christian Brothers Automotive-KnoxvilleDemographic statistics

Traffic Counts

Income 1 Mile 3 Miles 5 Miles$ 0 - $14,999 6.0% 6.2% 6.9%$ 15,000 - $24,999 8.2% 6.9% 7.3%$ 25,000 - $34,999 7.4% 7.0% 7.9%$ 35,000 - $49,999 13.9% 12.2% 12.4%$ 50,000 - $74,999 16.1% 18.7% 18.6%$ 75,000 - $99,999 14.3% 16.1% 15.9%$100,000 - $124,999 12.7% 13.4% 11.8%$125,000 - $149,999 7.2% 7.0% 6.5%$150,000 - $199,999 7.4% 6.1% 5.9%$200,000 - $249,999 3.0% 2.6% 2.7%$250,000 + 3.9% 3.8% 4.1%2013 Median Household Income $72,557 $73,507 $70,7162013 Per Capita Income $41,461 $38,916 $38,8882013 Average Household Income $97,984 $96,493 $95,104

Population 1 Mile 3 Miles 5 Miles2000 Population 3,601 28,392 86,0862010 Population 4,006 33,125 102,3212013 Population 4,049 34,091 105,0222018 Population 4,193 37,166 112,708

Households 1 Mile 3 Miles 5 Miles2000 Households 1,476 11,175 34,4702010 Households 1,694 13,346 41,7632013 Households 1,713 13,748 42,8942018 Households 1,777 15,112 46,2722013 Average Household Size 2.49 2.52 2.442013 Daytime Population 9,167 37,815 58,9792000 Median Housing Value $110,676 $165,502 $161,6732000 Owner Occupied Housing Units 79.89% 79.41% 70.25%2000 Renter Occupied Housing Units 13.88% 15.01% 23.13%2000 Vacant 4.79% 4.74% 5.81%2013 Owner Occupied Housing Units 81.99% 77.70% 70.70%2013 Renter Occupied Housing Units 18.01% 22.30% 29.30%2013 Vacant 3.20% 4.90% 5.55%2018 Owner Occupied Housing Units 81.80% 77.46% 70.75%2018 Renter Occupied Housing Units 18.20% 22.54% 29.25%2018 Vacant 3.01% 4.93% 5.50%

34,695

68,710

christian brothers - knoxville, tn

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