U.S. CORE INDUSTRIAL PORTFOLIO PROPERTY DESCRIPTION …

U . S . CO R E I N D U S T R I A L P O R T F O L I O P R O P E R TY D E S C R I P T I O N

CO N F I D E N T I A L O F F E R I N G M E M O R A N D U M 7

2 01 ELIZABETH STREETBORDENTOWN, NEW JERSEY

Located right off of the New Jersey Turnpike (I-95), 201 Elizabeth Street serves as Bai Brands’ primary U.S. warehouse and distribution center. With headquarters only 10 miles away in

Hamilton, New Jersey, Bai Brands, owned by Keurig Dr Pepper Inc. (Sales $11 Billion, S&P: BBB), produces and distributes an antioxidant beverage and named one of “America’s Most

Promising Companies” by Forbes. BAI has heavily invested capital into their space, customizing the building to suit their functions and capabilities including heavy power, 24’ clear

height, 40’ x 43’ column spacing, 16 loading docks with full dock package, 2 drive-in doors, platform loading for 2 rail car positions (serviced by Conrail/Norfolk Southern), abundant car

and trailer parking, and 140,767 square feet of potential expansion area, adding exponential value to future ownership. The property also offers BAI excellent logistics with a location

2 miles from Exit 7 on the NJ Turnpike with immediate access to Routes 206 and 130, I-195 and I-295. This submarket, which has about 3.3% vacancy across all classes of industrial

space, has attracted large users which has validated the submarket’s appeal as a regional distribution hub that can service both New York City (63 miles to the NE) and Philadelphia

(45 miles to the SW), among other locations. BAI is also on a Triple net lease, mitigating capital exposure, 6 years of term remaining and contractual yearly rental increases, providing

cash flow stability.



295

95

AREA MAP201 ELIZABETH STREET, BORDENTOWN, NEW JERSEY

130

201ELIZABETH STREET



Address: 201 Elizabeth Street, Bordentown, NJ

County: Burlington County

Year Completed: 1985, renovated in 2005

Zoning: CI Commercial Industrial

Parcel Number: Block 1601 Lot 1

Total Acres: 39.16 acres

Building Coverage Ratio: 31.39%

BUILDING FEATURES

Total Square Feet: 275,631 Square Feet

Percent Office: 3.00%

Clear Height: 24'

Column Spacing: 40'w x 43'd

Parking: 80 car spaces and 120 trailer spaces

Dock High Doors: 16 dock doors

Drive-In-Doors: 2 Drive-in doors

Rail Doors: Platform loading for 2 rail car positions (Serviced by CSX/Conrail/ Norfolk Southern)

PROPERTY DE S C R I PTIO N201 ELIZABETH STREET, BORDENTOWN, NEW JERSEY


CO N F I D E N T I A L O F F E R I N G M E M O R A N D U M 1 0

CONSTRUCTION FEATURES

Construction: Precast concrete

Foundation: Reinforced concrete slab

Exterior Walls: Precast concrete

Roof: EPDM roof covered with solar panels.

Fire Protection: Wet sprinkler system

HVAC: Suspended gas heaters in warehouse, forced air in office

INTERIOR FEATURES

Floor Construction: Sealed concrete

Ceilings: Exposed

Lighting: Fluorescent and Incandescent



ELIZABETH ST

LUCAS DR

LANDON D R

201 Elizabeth St

206

Nor

folk

Sou

ther

n/CS

X Ra

il

40’

48’

Concrete

KEY

Drive-In-Doors

Property Line

Interior Dock Doors

SITE PL AN201 ELIZABETH STREET, BORDENTOWN, NEW JERSEY

U . S . CO R E I N D U S T R I A L P O R T F O L I O M A R K E T O V E R V I E W


MARKET OV E R VI E W

OVERVIEW

Greater Philadelphia is an 11-county metropolitan area that offers a well-educated workforce, ease of access, and a cost-efficient environment. Strategically located between New York City, the nation’s financial hub, and Washington DC, the legislative and regulatory center of the US, Philadelphia is at the core of the country’s wealthiest and most densely-populated region.

QUALITY OF LIFE

Philadelphia has one of the lowest costs of living & housing prices among large MSAs including Boston, New York and Washington D.C. Its millennial population is growing at a faster rate than any of the nation’s 30 largest cities and six of its 11 counties are in the top 100 wealthiest counties in the country.

TALENTED WORKFORCE

Philadelphia’s 3 million person labor force provides an abundant supply of skilled workers in virtually all occupations. With over 100 colleges and universities, Greater Philadelphia ranks as one of the nation’s leading centers for higher education. Greater Philadelphia’s schools are growing, planning to spend approximately $2.93 Billion in capital projects over the next five years, generating a total annual increase in regional employment of 7,153 jobs along with $447.7 million in total labor income.

• 730 Trade & Certificate Programs

• Highest award rate for professional degrees

• 2nd Highest award rate for bachelor’s degrees

• 36% of the population 25 years and older have a bachelor’s degree or higher (compared to the US average of 30%)

• 13% have advanced degrees (above the US share of 11%)

ACCOLADES

First in millennial growth rate

First in housing value and opportunity among top metros, according to the Nat’l Association of Home Builders

Third largest metro in the Northeast, with $432 billion in Gross Regional Product

Fourth largest media market

Fifth largest population, with 6.3 million people

Sixth largest workforce, just over 3 Million, including highly skilled talent

#1

#1

#3

#4

#5

#6

46 MILLION

people live withina 200 mile radius

$1.46 TRILLION in combined

income

FORTUNE 500

11 companies headquartered in

the region

PHILADELPHIA, PENNSYLVANIA



INDUSTRIES/LOGISTICS

Greater Philadelphia has an established transportation network (by way of air, highway, & waterways), with hundreds of transportation and logistics companies, and a robust supply of distribution and warehouse facilities. Due to its favorable location, excellent labor pool, and multimodal transportation network, the region offers a major competitive advantage to companies that depend on the efficient movement of raw materials and finished goods.

MANUFACTURING

Greater Philadelphia is home to one of the largest concentrations of manufacturers in the

nation, with over 185,000 employed at 5,500 establishments in the region.

LEADING LOGISTICS COMPANIES IN GREATER PHILADELPHIA

LEADING MANUFACTURING COMPANIES IN GREATER PHILADELPHIA



• Convenient access to major interstate highways connecting the region to major cities across the county: I-95, I-80, I-78, NJ & PA Turnpikes • Located at the core of the Northeast Corridor, it is well connected by interstate highways to points north and south (via I-95, I-295, the New Jersey and

Delaware turnpikes) and east and west (I-76/Pennsylvania Turnpike with proximity to I-78 and I-80)

• Both CSX Transportation and Norfolk Southern Railroad, two Class 1 carriers, offer efficient and competitive intermodal rail service • The Intermodal Container Transfer Facility (ICTF) operated by CSX is adjacent to the Seagirt Marine Terminal, and the Bayview Intermodal Yard operated by

Norfolk Southern is a very short dray trip from Baltimore’s container terminals

• Philadelphia International Airport is ranked in the top 10 North American airports in the number of takeoffs and landings and is the international hub for American Airlines

• The UPS hub located at the airport is its second-busiest facility capable of handling 95,000 packages per hour and providing same-day service to both Western Europe and the Eastern US

• Port of Philadelphia is the only major port on the East Coast served by two Class 1 railroads that provide easy access to the Midwest, Mid-Atlantic, and Northeast markets

• World’s largest fresh water port and one of the nation’s largest seaports for imported goods• Construction of the new 120-acre Southport Marine terminal began in 2013, adding two berths for post-Panama ships and six high-capacity cranes

• Port of Wilmington is the top North American port for fresh fruit, bananas, and fruit concentrates • Contains the largest dock-side cold storage facility

• Port of Camden is the top port for wood products, it receives hundreds of ships moving domestic and international cargo annually

• Kinder Morgan Port of Bucks County is located on the Delaware River, ocean-going vessels can get to the Philadelphia Federal Customs District of Bucks County

• The channel depth to Kinder Morgan is maintained at a depth of 40 feet• Annually, this port imports approximately 2 Million tons of cargo, primarily including steel

R A I L

A I R

H

I G H W A Y S

P O R T S

LOGISTICS

Infrastructure expertise from the Greater Philadelphia Market is the key: five international airports within a 90-minute drive, two Class I freight railroads, 100+ interstate highway interchanges, and three major shipping ports along the Delaware River. From Philadelphia, approximately 40% of the US population resides within a day’s drive and 60% of the population of the US & Canada is reachable by a 2-hour flight



OVERVIEW

The New Jersey industrial market remains strong as e-commerce strengthens its grip on retail. The vacancy rate dropped to 2.8% when compared to the first quarter of 2019 when it was 3.1%, while market rent has continued its historic rise to $8.96 per square foot net. Historically, real estate trails the economy in a time of recession, but early indications are that e-commerce has bucked the trend and increased its grip on the future of retail, resulting in the strengthening of New Jersey’s already strong industrial market.

The rise of e-commerce has maintained the industrial real estate market, with arguably the most famous e-commerce company leading the way. Amazon completed numerous large deals this quarter including:

Seller Address Total OccupiedSquare Feet

Alfieri 343 Half Acre Road, Canbury 953,595 SF

Centerpoint 1800 Lower Road, Linden 386,296 SF

Prologis 8-B Court South, Edison 289,698 SF

Duke Realty 1 Paddock Street, Avenel 187,017 SF

RTC Properties 5 Logistics Drive, Kearny 181,440 SF

Brookfield 10 Patton Drive, West Caldwell 167,,894 SF

Black Creek 5 Paddock Street, Avenel 156,307 SF

CT Realty Investors 79 Thomas McGovern Drive, Jersey City 95,808 SF

CAPITAL MARKETS AND NEW DEVELOPMENT

Strong job and population growth in recent years have caused the Philadelphia/Southern New Jersey industrial market to continually rise on the radars of both investors and developers. The demand for industrial space is growing as more users look to service last-mile customers in densely populated areas. Developers take down large tracts near major thoroughfares in this region, oftentimes building on speculative bases. The most active players in the Philadelphia/Southern New Jersey industrial market comprise a mix of locally based owner/developers and new-to-market national investors.

Industrial Investments has also increased its holdings in South New Jersey with the purchase of a 21-building portfolio in West Berlin. In addition, Wharton Industrial, an affiliate of Walton Street Capital, recently acquired a 32-building, 1.1 million SF portfolio in Pennsauken. Velocity Venture Partners has also been acquiring net-leased and value-add properties.

FUTURE EXPECTATIONS

There are multiple land sites under contract in Burlington, Gloucester and Salem counties. These are examples of locations that had not previously been considered for distribution operations but have gained interest as sites with more desirable interstate access dwindle. Vacancy will continue to decrease in 2020. There is high investor demand with very little product

These recent leases further demonstrate Amazon’s belief that New Jersey’s central location remains essential as they continue to expand to service its customers in the Northeast.

NEW JERS E Y



OVERVIEW

For bulk warehouse product, most deals are taking place in submarkets where there is new supply, particularly northern Burlington County. Notable deals done are Target and Amazon taking +/- 1,000,000 SF each in the Burlington submarket. Currently this submarket is seeing a significant increase in new construction as Northern NJ rents have pushed into the double digits given the scarcity of larger development sites. The surrounding area also offers a strong pool of available labor and mass transit options such as NJ Transit’s River Line, which connects Trenton to Camden.

Industrial users have found the submarket increasingly attractive in recent years, thanks in part to the recent widening of the Turnpike between exits 6 and 9. The Prologis Burlington 130 complex is at the nexus of the New Jersey and Pennsylvania turnpikes, highlighting one of the strengths of Burlington and adjacent towns.

Burlington County, which has about 3.3% vacancy across all classes of industrial space, has attracted large users such as Grainger, H&M and Destination Maternity. Several of those users have validated the submarket’s appeal as a regional distribution hub that can service both New York City and Philadelphia, among other locations.

Exit 6 has emerged as a viable alternative to those seeking space in traditional submarkets such as 8A. Developers, brokers and tenants have adjusted and now consider locales such as Burlington to be part of the central New Jersey industrial market.

For bulk warehouse product, most deals are taking place in submarkets where there is new supply, particularly northern Burlington County. As the number of raw land sites has diminished, particularly in Burlington County, developers such as Matrix, DCT (now ProLogis) and NFI have been buying properties with existing buildings to be redeveloped.

BURLINGTO N INDUSTRIAL SU BMARKET

QUICK STATS

2.8%OVERALL VACANCY RATE

$8.96MARKET RENT (NNN)

6.1M12 MONTH ABSORPTION (SF)

U . S . CO R E I N D U S T R I A L P O R T F O L I O F I N A N C I A L A N A LY S I S


Tenant: BAI Brands, LLC Parent: Keurig Dr Pepper Inc.

Total Occupancy SF: 275,631 SF Parent Revenue: $11 Billion

Buildings (% of Total Building SF): 201 Elizabeth Street, Bordentown, NJ (100%) Parent Ticker: KDP

% of Portfolio SF: 25.39% Parent S&P Rating: BBB

Revenue: $50 Million Website: www.drinkbai.com

Headquarters: Trenton, NJ

Bai Brands is a beverage company founded in 2009 in Princeton, New Jersey, by entrepreneur Ben Weiss. Weiss started Bai after he learned about the coffeefruit – the fruit that surrounds the outside of the coffee bean — and decided to use it to create a new brand of beverages. The company offers a line of low-calorie soft drinks (including sodas, bottled water, iced tea, and non-carbonated fruit-flavored drinks) sweetened with erythritol and rebaudioside A (stevia leaf extract), ascorbic acid, and extract from coffea fruit harvested in Indonesia; its flavors typically are identified by the name of an exotic locale along with the natural fruit flavor used. Its flagship product is Bai Antioxidant Infusions. In 2015, it launched a brand of bottled water called Bai Antiwater.

By 2015, Bai was named one of “America’s Most Promising Companies” by Forbes. In 2016, entertainer Justin Timberlake invested in Bai and became the brand’s “chief flavor officer.” On November 22, 2016, it was announced that Dr Pepper Snapple Bottling Group had made a cash purchase of Bai Brands for $1.7 billion. Keurig Dr Pepper Inc., formerly Dr Pepper Snapple Group, is one of North America’s largest beverage companies with more than 125 owned, licensed, and partner brands. It owns the top single-serve coffee system in the US (Keurig) and one of the US’s leading soft drinks (Dr Pepper), as well as Green Mountain coffee, Canada Dry ginger ale, A&W root beer, Snapple tea and juice, and Mott’s fruit juice, among many other products. KDP operates facilities across North America. Dr Pepper Snapple Group was acquired by Keurig Green Mountain in 2018 and renamed Keurig Dr Pepper.

201 ELIZABETH STREET, BORDENTOWN, NJTENANT OVERVIEW



CASH FLOWYr 1 PSF Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10

For the Years Ending 275,631 SF Dec-2021 Dec-2022 Dec-2023 Dec-2024 Dec-2025 Dec-2026 Dec2027 Dec-2028 Dec-2029 Dec-2030

GROSS INCOME Potential Base Rent $4.84 $1,334,054 $1,389,180 $1,444,306 $1,499,433 $1,554,559 $1,953,551 $2,171,355 $2,236,496 $2,303,590 $2,372,698 Absorption & Turnover Vacancy $0.00 0 0 0 0 0 (356,544) 0 0 0 0 Free Rent $0.00 0 0 0 0 0 (178,272) 0 0 0 0 Total Expense Recoveries $3.00 827,439 852,891 879,038 905,901 933,501 789,437 1,012,106 1,042,469 1,073,743 1,105,955

Effective Gross Revenue $7.84 $2,161,493 $2,242,071 $2,323,345 $2,405,334 $2,488,059 $2,208,172 $3,183,461 $3,278,965 $3,377,334 $3,478,654

OPERATING EXPENSES Real Estate Taxes $1.42 391,782 403,535 415,641 428,111 440,954 454,183 467,808 481,842 496,298 511,187 Insurance $0.19 51,102 52,635 54,214 55,841 57,516 59,241 61,018 62,849 64,734 66,677 Management Fee $0.31 86,460 89,683 92,934 96,213 99,522 88,327 127,338 131,159 135,093 139,146 Utilities $0.79 218,603 225,161 231,916 238,873 246,040 253,421 261,023 268,854 276,920 285,227 Landscaping $0.13 36,907 38,014 39,155 40,329 41,539 42,785 44,069 45,391 46,753 48,155 Security $0.03 8,517 8,773 9,036 9,307 9,586 9,874 10,170 10,475 10,789 11,113 Repair & Maintenance $0.12 34,068 35,090 36,143 37,227 38,344 39,494 40,679 41,899 43,156 44,451

Total Operating Expenses $3.00 $827,439 $852,891 $879,038 $905,901 $933,501 $947,324 $1,012,106 $1,042,469 $1,073,743 $1,105,955 Net Operating Income $4.84 $1,334,054 $1,389,180 $1,444,306 $1,499,433 $1,554,559 $1,260,847 $2,171,355 $2,236,496 $2,303,590 $2,372,698

LEASING & CAPITAL COSTS Tenant Improvements $0.00 0 0 0 0 0 205,699 0 0 0 0 Leasing Commissions $0.00 0 0 0 0 0 533,721 0 0 0 0 Capital Reserve $0.10 28,390 29,242 30,119 31,023 31,953 32,912 33,899 34,916 35,964 37,043

Total Leasing & Capital Costs $0.10 $28,390 $29,242 $30,119 $31,023 $31,953 $772,331 $33,899 $34,916 $35,964 $37,043 Net Cash Flow Before Debt Service $4.74 $1,305,664 $1,359,939 $1,414,187 $1,468,410 $1,522,606 $488,516 $2,137,456 $2,201,579 $2,267,627 $2,335,656

GENERAL ASSUMPTIONS

Reporting/Value Start Date 1/1/2021

Projected Occupancy (1/1/21) 100%

Capital Reserve ($/SF) $0.10

Market Rent (PSF/Yr) Rent Abatements (Mos) Tenant Improvements Leasing Commissions Downtime

MLA RenewalProbability

Term(Mos)

NewTenant

RenewalTenant

WeightedAvg.

AnnualRental

Escalations

ReimbursementMethod

NewTenant

RenewalTenant

WeightedAvg.

NewTenant

RenewalTenant

WeightedAvg.

NewTenant

RenewalTenant

WeightedAvg.

Vacancy Period(Mos)

Weighted Avg.

(Mos)

$6.50 NNN 75% 61 $6.50 $6.50 $6.50 3.00% NNN 1 1 1 $1.00 $0.50 $0.63 7.50% 3.75% 4.69% 9 2

MARKET LEASING ASSUMPTIONS

201 ELIZABETH STREET, BORDENTOWN, NEW JERSEY



RENT ROLL

Tenant NameSuite NumberLease DatesLease Term

Square Feet% Bldg Share

AmountPer Year

RatePSF

ChangesOn

ChangesTo

MonthsTo

Abate

OperatingExpense

Reimbursements

TIRate

Amount

CommissionsRate

Amount

MarketLeasing

AssumptionComments:

BAI Brands, LLC 275,631 $1,306,491 $4.74 Jul-2021 $4.94 - NNN - - $6.50 NNN RENEWAL OPTION: 1, 5-yr option to renew with 120 days notice. Lease rate shall continue to increase annually at same rate as the original term’s annual increases. EXPANSION OPTION: Landlord is able to expand building by +/- 140,000 square feet.”

Suite: 100 100.00% Jul-2022 $5.14 7/1/2015 - 4/30/2026 Jul-2023 $5.34 10 Years 10 Months Jul-2024 $5.54

Jul-2025 $5.74

Total Occupied Square Feet 254,460

Total Available Square Feet 0

201 ELIZABETH STREET, BORDENTOWN, NEW JERSEY

U.S. CORE INDUSTRIAL PORTFOLIO PROPERTY DESCRIPTION …

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