401 N. BLUFF ROAD COLLINSVILLE, IL - TradeCor, LLCtradecorllc.com/site_plan/Walgreens PACKAGE-...

UMB BANK

401 N. BLUFF ROAD | COLLINSVILLE, IL

> Strong Corporate Guarantee - Walgreens Co. (NYSE: WAG) Revenues Over $63.35B in 2010

> Ranked #32 Fortune 500 List 2010 - “America’s Largest Companies”

> 75 Year Fee Simple Ground Lease - Coupon Clipper Trophy Asset

> Very Rare 10% Rental Increases Every 10 Years - Including All Options

> America’s #1 Drug Store Chain - Over 7500 Locations Across the U.S. and Growing

> Above Average Demographics - Affluent Suburb of Phoenix - Future Site of Estrella Falls Regional Mall

> Surrounding Retailers Include: Wal-Mart, TJ Maxx, Ross, Target, Petco, Old Navy, Staples,Chase, Party City, Toys R Us, Olive Garden, P.F. Chang’s, Red Robin, Starbucks, Fairfield Inn, Spring Hill Suites

Colliers NNN Group

Eric CarltonLicense No. [email protected]

Jereme SnyderLicense No. [email protected]

WALGREENS

1654 N. PEBBLE CREEK PARKWAY | GOODYEAR, ARIZONA

EXCLUSIVE OFFERING MEMORANDUM

Fee Simple Ground LeaseSINGLE TENANT NNN INVESTMENT

TABLE OF CONTENTS

Confidentiality Agreement 3

Tenant Description 4

Property Description 5

Investment Highlights 6

Property Overview 7

Financial Analysis 8

Rent Schedule 9

Property Photos 10

Aerial View 12

Location Map 13

Site Plan 14

Demographics 15

Area Profile 16

The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.

Colliers International is the 2rd largest commercial real estate firm in the world.

CONFIDENTIALITY AGREEMENT

This Offering Memorandum was prepared by Colliers International (“Broker”) solely for the use of prospective for the purchase of 14,820 square feet on 1.73 acres of land, located at 1654 N. Pebble Creek Parkway (“Property”). Neither the Broker nor the Owner of the Property, make any representation or warranty, expressed or implied, as to the completeness or accuracy of the material con-tained in the Offering Memorandum.

Prospective purchasers of the Property are advised that changes may have occurred in the physical or financial condition of the Property since the time this Offering Memorandum or the financial statements herein were prepared. Prospective purchasers acknowledge that this Offering Memorandum and the financial statements herein were prepared by Broker, and not by Owner, and are based upon assumptions or events beyond the control of both Broker and Owner, and therefore may be subject to variation. Other than current and his-torical revenue and operating expense figures for the Property, Owner has not, and will not, provide Broker or any prospective purchaser with any projections regarding the Property. Prospective purchasers of the Property are advised and encouraged to conduct their own comprehensive review and analysis of the Property.

The Offering Memorandum is a solicitation of interest only and is not an offer to sell the Property. The Owner and Broker expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers to purchase the Property and expressly reserve the right, at their sole discretion, to termi-nate discussions with any entity at any time with or without notice.

The Owner shall have no legal commitments or obligations to any entity review-ing the Offering Memorandum or making an offer to purchase the Property unless and until such offer is approved by Owner pursuant its Governing Au-thorities and the signature of the Owner or Owner’s representative is affixed to a Real Estate Purchase Agreement prepared by Owner.

This Offering Memorandum is confidential. By accepting the Offering Memo-randum, you agree (i) that you will hold and treat the Offering Memorandum and its contents in the strictest confidence, (ii) that you will not photocopy or duplicate any part of the Offering Memorandum, (iii) that you will not disclose the Offering Memorandum or any of its contents to any entity without the prior authorization of the Owner, and (iv) that you will not use the Offering Memoran-dum in any fashion or manner detrimental to the Owner or Broker.

Colliers International obtained the information contained in this Offering Memo-randum from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions, changes of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions, or estimates for example only, and they may not represent current or future performance of the Property. You and your tax and legal advisors should conduct your own investigations of the physical condition of the Property and of the financial performance of its future Ownerships.

Colliers NNN Group

P. 4 WALGREENS | 1654 N. PEBBLE CREEK PARKWAY, GOODYEAR, AZ


America’s leading provider of the most convenient access to consumer goods and services, and pharmacy, health and wellness services. Walgreensstores provide patients with all of their prescription needs in one place without sacrificing the safety, service or convenience of their nearby neighborhooddrugstore. The company, founded in 1901, has recorded 34 consecutive years of record sales and earnings.

In order to maintain success through the changing economy, Walgreens has taken significant measures to become a more efficient and customer-focused com-pany. It is currently conducting a company-wide initiative to align costs, culture and capabilities to the realities of the current economic environment. It is tar-geting $1 billion in costs reductions by 2011 through more efficient processes, strategic sourcing and plans to reduce corporate overhead and work in its storesthroughout the country.

The company’s focus in the pharmacy is on filling prescriptions more efficiently. Walgreens is implementing out a new initiative to transform the practice of com-munity pharmacy. With a current focus on stores in Florida, the company is moving tasks such as phone calls, prescription data entry and insurance verificationfrom individual stores to more efficient central processing facilities.These central facilities will also fill approximately one-third of prescriptions for delivery to the store when patients request next-day pickup. This hybrid approachblends the best of community pharmacy practices and central fulfillment. These efforts will not only reduce costs to fill prescriptions, but will give pharmacistsmore time to offer expanded counseling services to improve patient compliance and help people better manage chronic medical conditions.

Walgreens remains one of the fastest growing retailers in the country,despite the organization’s planned slowdown of organic growth from thecurrent rate of 9 percent to between 2.5 and 3 percent by 2011. Slower growth offers two big positives for the company. The first is more time todevelop management skills and focus on improving the customer experi-ence. The second is greater flexibility to invest in opportunities that willstrengthen the company’s core retail base and deliver attractive returns toshareholders.

To complement its drugstores, Walgreens is growing its health clinics andspecialty pharmacy business. After acquiring two worksite health centercompanies last spring, Walgreens has integrated those services into itsnew Health and Wellness division, which currently operates more than 680health and wellness clinics in stores and on employer worksites.

TENANT DESCRIPTION

Walgreens Rankings:Fortune 2009- World's Most Admired Companies - Ranked No. 6»Fortune 2009- 40 Best Stocks to Retire On»2010 Forbes Platinum 400 List »Walgreen's Standard and Poor's Rating A+»Walgreen's Moody's Current Rating is A2»Revenues over 63.3B and Profits Topping 2.0B - 2010»America’s Largest Drugstore Chain - Over 7,100 Locations»Ranked #32 on Fortune 500 List 2010 - “America’s Largest Companies”»Ranked #206 on Forbes 2010 - “The World’s Biggest Public »Companies”



PROPERTY DESCRIPTIONPROPERTY OVERVIEWThe offering includes a single tenant, freestanding Walgreens with drive-thru located in the City of Goodyear, AZ. The property has a 75 year absolute net Ground Lease, commencing in April 2009 with rare 10% rental increases every 10 Years, the Lease is corporate guaranteed by Walgreen Co. (NYSE:WAG) which has a Standard & Poor’s rating A+ and a Moody’s Rating of A2. As the Nation’s largest drug store chain, it also remains one of the fastest growing retailers in the country as well. Now operating over 7500 locations, Walgreens reported net sales over $63.35 Billion and a net worth over $15.11 billion in the period ending May 2010. As of fiscal year August 2010, they also expected to add between 315 to 350 newly constructed stores, keeping it #1 in U.S. sales. Plus, they purchased Duane Reade drugstores in April 2010 increasing their presence in the Northeast. Currently, Walgreens is ranked #6 in Fortune 2009- World’s Most Admired Companies and ranked #32 in the Fortune 500 List for America’s Largest Companies. The Company has been labeled in Fortune 2009- 40 Best Stocks to Retire On and is listed in the Forbes Platinum 400 List.

LOCATION OVERVIEW

The subject property is located on Pebble Creek Pkwy at the corner of McDowell Rd in the growing city of Goodyear, AZ, an affluent suburb of Phoenix, just off Interstate 10 connecting all of greater Phoenix and Southern California. This area represents one of the main commercial and retail corridors for the entire region, highly traveled by commuters with over 125,000 cars per day along the 10 Freeway. Walgreens is shadow-anchored by The Estrella Falls Power Center and the future site of Estrella Falls Regional Mall (Westcor: Southwest Valley’s first super regional shopping center. The project will span more than 300 acres, and will consist of 2M SF of shopping, dining, and entertainment upon build out), comprising over 3M SF of all the national retailers including; Wal-Mart, TJ Maxx, Ross, Target, Petco, Old Navy, Staples, Chase, Party City, Toys R Us, Olive Garden, P.F. Chang’s, Red Robin, Starbucks, Fairfield Inn, Spring Hill Suites and Firestone Tire…creating the premiere destination location for the city. This fast-growing residential community boasts above average demographics, over $83,891 HHI, within one of the fastest growing parts of the entire country. This high traffic location strategically sits right on a busy signalized corner of McDowell Rd (over 25,000 cpd) and enjoys freeway visibility along the Interstate 10 freeway centrally located within the main retail trade area for most of Goodyear. Most population surveys point to this area of AZ as a vibrant and growing region in the future, providing excellent demand for many years to come and only adding to an already vibrant retail experience. This offering offers a rare opportunity to own a trophy asset with a pride of ownership with the leading Retailer of its category.

POPULATION 1-MILE 3-MILE 5-MILEEstimated Population (2010) 4,407 45,744 117,716

Projected Population (2015) 5,094 52,976 136,915

Projected Annual Growth 15.59% 15.81% 16.31%

Average Household Income (2010) $74,658 $83,981 $78,517



INVESTMENT HIGHLIGHTSSTRONG CORPORATE GUARANTY> Corporate Guaranteed Lease by Walgreen Co. (NYSE: WAG) – Ground Lease

> America’s Largest Drugstore Retail Chain - Over 7,500 Locations and Growing

> S & P Rated of A+, Moody’s Rated A2 - Strong Investment Grade Tenant

> Ranked #32 Fortune 500 List 2010 - “America’s Largest Companies”

> Ranked #6 Fortune 2009 – “World’s Most Admired Companies”

> Ranked #206 Forbes 2010 - “The World’s Biggest Public Companies”

> Pride of Ownership - America’s #1 Retail Drugstore Chain

STABLE INCOME- EASE OF MANAGEMENT> 75 Year Absolute NNN, Fee Simple Ground Lease – Stable Coupon Clipper Asset

> Zero Management Responsibilities- Tenant Responsible for all Expenses

> Newer Construction - Built in 2010- Portion of CobbleStone Creek Village Center

> Free Standing Drive-Thru Building - Street Monument Signage

EXCELLENT RETAIL DESTINATION LOCATION> Shadow Anchored – Estrella Falls Regional Power Center

> Excellent High Traffic Location – Freeway Visibility from Interstate 10- Signalized Corner

Along McDowell Rd

> Above Average Demographics - Over $84,000 Household Income within 3 Miles

> Premier Retail Location Along Interstate 10 Freeway- Main Corridor Thru Phoenix

Surround National Retailers Include: Wal-Mart, TJ Maxx, Target, Petco, Old Navy, Staples,

Chase, Party City, Toys R Us, Olive Garden, P.F. Chang’s, Red Robin, Starbucks, Fairfield

Inn, Spring Hill Suites and many more…

PERFECT 1031 EXCHANGE PROPERTY> Rare Opportunity to Purchase One of the Top Retailers- Ground Lease

> National Credit Tenant - Sector Leader with National Brand Recognition

> In Place Assumable Loan - Perfect 1031 Exchange Asset - Must be Assumed by Year’s End

> Unique 75 Year Absolute NNN Ground Lease Investment - Rental Increases with Walgreens



PROPERTY OVERVIEWPROPERTY INFORMATION

Subject Property: Walgreens Pharmacy

Property Address: 1654 N. Pebble Creek Parkway

Goodyear, Arizona

Price: $5,500,000

CAP Rate: 5.00%

Current NOI: $275,000

Building Size: 14,820

Land Size: 75,358 SF (1.73 Acres)

Construction Year: 2010

Parcel Number: 508-14-968

Traffic Count: Over 125,000 AADT at I-10 & Pebble Creek Pkwy

Over 25,000 AADT at McDowell Rd & Pebble Creek Pkwy

LEASE SUMMARY

Tenant: Walgreens

Corporate Guarantor: Walgreen Co. (NYSE: WAG)

Lease Term: 75 Years

Term Remaining on Lease: 73 Years

Lease Type: Fee Simple Ground Lease

Date of Lease: 09/01/2008

Lease Commencement: 04/30/2009

Rent Commencement: 04/30/2009

Lease Expiration: 04/30/2034

Annual Rent Terms: Years 1-10: $275,000Years 11-20: $302,500 Years 21-25: $332,750

(Right to Terminate - Years 26-30: $332,750 After year 25 and every Years 31-35: $366,025 5th year thereafter) Years 36-40: $366,025

Years 41-45: $402,627.50 Years 46-50: $402,627.50 Years 51-55: $442,890.25 Years 56-60: $442,890.25 Years 61-65: $487,179.27 Years 66-70: $487,179.27 Years 71-75: $535,897.19Colliers NNN Group



FINANCIAL ANALYSIS

TENANTBLDG SQUARE

FOOTAGELEASE START

LEASE

EXPIRATION

RENT/

SQ. FT.

ANNUAL

RENTINCREASES LEASE TERM

Walgreens 14,820 4/30/2009 4/30/2034 $18.56 $275,000

10% Increases Every 10 years

05/01/2019 $302,500

05/01/2029 $332,750

10% Increases Every 10 Years

05/01/2039 $366,025.00

05/01/2049 $402,627.50

05/01/2059 $442,890.25

05/01/2069 $487,179.27

05/01/2079 $535,897.19

Total : 14,820 $275,000

RENT ROLL

Walgreens - Absolute Single Tenant NNN Ground Lease

1654 N. Pebble Creek Parkway - Goodyear, AZ 85395

Net Operating Income $275,000 Price $5,500,000

Price / Sq. Ft. $371.12

Down Payment $2,200,000

Down Payment % 40.0%

Loan Amount $3,300,000

Cap Rate 5.00%

Net Operating Income $275,000

Interest Rate 5.25% Loan Payment $218,673

Amortization 30 Cash Flow $56,327

LTV 60% Cash-on-Cash 2.56%

T 10 Y DSCR 1 26%

PRICING GUIDANCE

PROPOSED FINANCING TERMS

INCOME & EXPENSE

Term 10 Years DSCR 1.26%



PROPERTY PHOTOS



AERIAL VIEW



LOCATION MAP - GOODYEAR, AZ



SITE PLAN - WALGREENS



DEMOGRAPHICS

POPULATION 1-MILE 3-MILE 5-MILE DAYTIME DEMOS 1-MILE 3-MILE 5-MILEEstimated Population (2010) 4,407 45,744 117,716 Total # of Businesses (2010) 147 1,176 2,334Census Population (2000) 41 16,844 46,971 Total # of Employees (2010) 2,130 16,187 27,971Projected Population (2015) 5,094 52,976 136,915 Employee Pop. per Business 14.49 13.76 11.98HISTORICAL ANNUAL GROWTH Residential Pop. per Business 29.98 38.90 50.441990-2000 105.00% 129.58% 87.92%2000-2010 10648.78% 171.57% 150.61%PROJECTED ANNUAL GROWTH2010-2015 15.59% 15.81% 16.31%

HOUSEHOLDS 1-MILE 3-MILE 5-MILE INCOME 1-MILE 3-MILE 5-MILEEstimated Households (2010) 1,432 16,517 38,298 Avg. Household Income (2010) $74,658 $83,981 $78,517Census Households (2000) 14 6,210 14,798 Median Household Income (2010) $56,358 $67,278 $64,137Projected Households (2015) 1,659 19,177 44,493 Per Capita Income (2010) $24,257 $30,358 $25,627HISTORICAL ANNUAL GROWTH1990-2000 133.33% 152.13% 101.83%2000-2010 10128.57% 165.97% 155.70%PROJECTED ANNUAL GROWTH2010-2015 15.85% 16.10% 16.18%

Colliers NNN Group



AREA PROFILE - GOODYEAR, AZ

GOODYEAR, ARIZONA IS . . .a city with a rich, rewarding quality of life and tremendous community spirit, ex-emplified by its winning two prestigious national awards in 2008 - the All-AmericaCity and City Livability awards. Ours is a city with relaxed sophistication -- whereyou will feel at home right away.

Nestled in the shadows of the Estrella Mountains, Goodyear is one of the fast-est growing cities in the Valley. VV A mere 20 minutes west of downtown Phoenix,Goodyear offers all the advantages of a small community, with all the cultural andentertainment resources the metro Phoenix area offers.

Scenic mountain views, desert vistas, wide open spaces, golf courses, lakes,parks and palm-lined streets have already attracted over 64,600 residents whoare among the most affluent and best educated in the state. Averaging 16 percentAAgrowth per year from 2000 to 2006, Goodyear has been one of the fastest grow-ing cities in the country.

GOODYEAR WINS MOST LIVABLE CITY AWARDRight on the heals of being named an All-America City, Goodyear has also beennamed one of the five “Most Livable Cities” in America with populations fewerthan 100,000 people. For the past 29 years, cities have competed for this veryprestigious award, which recognizes mayoral leadership for developing and imple-menting programs that improve the quality of life in America’s cities. Mayor JimCavanaugh accepted this honor at the U.S. Conference of Mayors’ annual meetingon June 21st for his vision and successful and innovative recruitment efforts tobring universities to Goodyear.

ABOUT GOODYEARGoodyear’s desert vistas, majestic mountains, master planned communities with lakes,country clubs and golf courses, and an active outdoor lifestyle have already attracted over65,000 people which represents just eleven percent of the build-out population. With amere 2,747 residents in 1980 and 6,258 in 1990, Goodyear’s population has exploded toa population of 65,275 according to the 2010 Census. Goodyear grew 245% betweenthe 2000 and 2010 Census and it is expected to surge to well over 100,000 residents by2015. The median income of our residents is estimated at $76,523 - one of the highest inthe state, the highest in the West Valley, the third highest in the Phoenix metro area, andVVhigher than the State’s largest cities including Phoenix, Tucson, Mesa, Chandler, Glendale,and Scottsdale (2007-2009 ACS*).

Development in the Phoenix area is moving west! Since 1998, more than 50% of theValley’s building permits have been in the WestVV Valley with theVV Southwest Valley leadingVVthe development boom. Goodyear is setting the pace among West Valley cities.VV Goodyearwas the fourth fastest growing suburban city in the country (under 100,000 population)between 2000 and 2006, averaging 16% growth per year during that period, accordingto Forbes Magazine.

According to the most recent Citizen Satisfaction Survey, Goodyear has a diverse popula-tion with more than 85 percent of heads of households being college-educated and 56percent having college degrees.

Goodyear is a young community with 31 percent of the population between the ages of35 and 49. As a growing community, 81 percent of residents have lived in Goodyear lessthan ten years. It is also family-oriented as 46 percent of household have children. Ad-ditionally, 47 percent have a household income over $75,000.The survey reports that 85-90 percent of residents feel Goodyear is a great place tolive and offers excellent quality of life. Most residents, 90 percent, also feel safe day andnight. Even in this economic downturn, 92 percent of residents are satisfied with the levelof service the city provides.

Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. This publication is the copyrighted property of Colliers International and /or its licensor(s). 2010. All rights reserved. Colliers NNN Group

Jereme SnyderLicense No. [email protected]

Eric CarltonLicense No. [email protected]

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