RITE AID. Investment Property Offering $1,969, Columbia Street, Adams, MA Offering Highlights

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1 Investment Property Offering $1,969,000 RITE AID 21 Columbia Street, Adams, MA Presented By: Kase Abusharkh 252 Abigail Circle Danville, CA (925) Offering Highlights New 20 Year Absolute Net Lease Zero Landlord Responsibilities Excellent Sales History S&P Rated B Credit 02/05/2009

2 Table of Contents 1 Financial Analysis Executive Summary Investment Information Rent Roll Summary 2 Additional Information

3 1. Financial Analysis

4 RITE AID Executive Summary 21 Columbia Street Adams, MA List Price $1,969,000 Price Per GLA $ Price per S.F. $ CAP 8.00 % GLA 10,504 Building S.F. 10,504 Percent Occupied % Land Acres 1.80 Rite Aid (NYSE: RAD) Cross Street Valley Street Tax Parcel Number ADAM Market Pittsfield, MA MSA Sub Market Berkshire County Year Built 1958 Building Class A Location Class A No. of Buildings 1 HVAC Yes Street Frontage 215 Feet Corner No No. of Parking Spaces 64 Parking Ratio 6/1000 No.Tenants 1 No. Stories 1 Property Descriptions Construction Construction was completed in Parking The asset is adequately parked with approximately 64 on-site parking spaces. Traffic Counts Traffic counts are strong. Major Tenants Rite Aid (NYSE: RAD) is a retail pharmacy chain, operating over 5,000 stores in 31 states and the District of Columbia. Rite Aid is the largest drugstore chain on the East Coast and the third largest drugstore chain in the U.S. The company is publicly traded on the New York Stock Exchange under the ticker RAD. Rite Aid began in 1962 as a single store opened in Scranton, Pennsylvania called Thrifty Discount Center. After several years of growth, Rite Aid adopted its current name and debuted as a public company in Rite Aid is headquartered in Camp Hill, a suburb of Harrisburg, Pennsylvania. Rite Aid reported total sales of USD $16.5 billion in fiscal As of 2005, its market capitalization was about $2.08 billion. Rite Aid is a Fortune 500 company. Rite Aid has a Standard & Poor s Rating B.

5 Area Adams is a town in Berkshire County, Massachusetts. It is part of the Pittsfield, Massachusetts Metropolitan Statistical Area. The population was 8,809 at the 2000 census with growth since then. The town was officially incorporated in 1778 as Adams, named in honor of Samuel Adams, revolutionary leader, signer of the Declaration of Independence and later governor. In 1889, the Berkshire Cotton Manufacturing Company was founded in Adams. Berkshire Cotton later became a major part of Berkshire Hathaway, who once had a large factory in Adams. Pittsfield, the principal city in the metro area is the largest city and the county seat of Berkshire County. The MSA encompasses all of Berkshire County and continues to be one of the population centers of Western Massachusetts. In 2006, Forbes ranked Pittsfield area as #61 in its list of Best Small Places for Business. In 2005, Farmer's Insurance ranked Pittsfield 20th in the United States as Most Secure Place to Live. Property This offering is the rare opportunity for an investor to acquire an absolute net leased Rite Aid asset with a new 20 year lease. The lease term is 20 years with a 10% bump every 10 years. The lease is net and provides for zero landlord responsibilities. The lease provides for eight five year options.

6 Investment Information RITE AID 21 Columbia Street Adams, MA Listing Price $1,969,000 Current CAP 8.00 % Year Ten CAP 8.80 % Price Per S.F. $ Price Per GLA $ GLA 10,504 Building S.F. 10,504 Percent Occupied % Land Acres 1.80 Estimated Annualized Operating Data Current Year Ten Net Operating Income $157,520 $173,272 Highlights New 20 Year Absolute Net Lease Zero Landlord Responsibilities Excellent Sales History S&P Rated B Credit

7 Rent Roll Summary Tenant Name Start Date End Date Occupied S.F. Annual Rent S.F. Occupied Rent % of Total Escalations / Options / Comments Rite Aid 5/13/2008 6/1/ ,504 $15.00 $157, % 10% increases every 10 years. Eight 5 year options to renew. Total 10,504 $157, %

8 2. Additional Information

9 Actual Site Photo

10 Aerial Photo

11 Location Map

12 Tenant Overview Rite Aid (NYSE: RAD) is a United States retailer and pharmacy chain, operating over 5,000 stores in 31 states and the District of Columbia. Rite Aid is the largest drugstore chain on the East Coast and the third largest drugstore chain in the U.S. The company is publicly traded on the New York Stock Exchange under the ticker RAD. Rite Aid began in 1962 as a single store opened in Scranton, Pennsylvania called Thrif D Discount Center. After several years of growth, Rite Aid adopted its current name and debuted as a public company in Rite Aid is headquartered in Camp Hill, a suburb of Harrisburg, Pennsylvania. Rite Aid reported total sales of USD $16.5 billion in fiscal As of 2005, its market capitalization was about $2 billion. Rite Aid is a Fortune 500 company. The first store opened in September Through acquisitions and new stores, Rite Aid quickly expanded into 5 northeast states by The chain was officially named Rite Aid Corporation in 1968 and made its debut on the American Stock Exchange. It moved to the New York Stock Exchange in Just ten years after its first store opened, Rite Aid operated 267 locations in 10 states. It was named the third largest drugstore in the United States by 1981; shortly thereafter, 1983 marked a sales milestone of $1 billion. A 420-store acquisition along the east coast expanded Rite Aid's holdings beyond 2,000 locations. Among the companies acquired was Baltimore, Maryland's Read's Drug Store. Rite Aid acquired twenty-four Hooks Drug stores from Revco in 1994, selling nine of those stores to Perry Drug Stores, a Michigan-based pharmacy chain. One year later, the 224-store Perry chain itself was acquired by Rite Aid. The 1,000-store West Coast chain Thrifty PayLess was later acquired in The acquisition of Thrifty PayLess included the Northwest-based Bi-Mart membership discount stores, which was sold off in Acquisitions of Harco, Inc. and K & B Inc. brought Rite Aid into the Gulf Coast area. General Nutrition Companies (GNC) and Rite Aid formed a partnership in January 1999, bringing GNC mini-stores within the Rite Aid pharmacies. A partnership with drugstore.com in June 1999 allowed customers of Rite Aid to place medical prescription orders online for same-day, in-store pickup. Beginning in March 2005, Rite Aid introduced Living More, a seniors' loyalty program; offering 10% off of prescription drugs purchased with cash, generic products, as well as other items. Additional benefits also include discounts on certain days of the week, as well as unadvertised sales on merchandise. This program is very similar to the former Revco program which was called "Senior Shoppers"; Rite Aid attempted to purchase Revco in This might be attributed to the fact that Revco's former Vice President of Marketing, James Mastrian, now holds the same position at Rite Aid.

13 Early in 2005, the UAW announced that its members' prescriptions would be filled through mail order. This decision by the union disproportionately affected Rite Aid as it has predominant market strength where the UAW has its highest union density nationally. In July 2005, Rite Aid completed its acquisition of Shelley's Pharmacy, a chain pharmacy in Philadelphia. On August 23, 2006, the Wall Street Journal announced that Rite Aid would be buying the Eckerd Pharmacy and Brooks Pharmacy chains (Brooks Eckerd Pharmacy) from the Quebec-based Jean Coutu Group for US$3.4 billion, and merging the two chains into one dominant pharmacy system. The company's shareholders overwhelmingly approved the merger on January 18, 2007.[2] After some store closures and the conversion of the two chains to Rite Aid is complete, the deal will make Rite Aid the dominating drug store retailer in the Eastern U.S., and secures its place as the third largest drug retailer nationwide. Similar to what CVS has gone through in Chicagoland after its purchase of Albertson's drug store chains, the deal has left Rite Aid with some locations in close proximity to each other. (Only 23 store locations nationally were sold off to Walgreens, The Medicine Shoppe, or independent owners in order to meet federal regulations.) In many situations, especially Pennsylvania where both chains were dominant and had roots in those states (Rite Aid originated in Scranton, while Eckerd has roots in Western Pennsylvania via Erie for itself and Pittsburgh for converted Thrift Drug locations), there are now two Rite Aids as close as right next door to each other. Rite Aid had sold some locations to J.C. Penney's Thrift Drug chain in the mid-1990s shortly before J.C. Penney's acquisition of Eckerd, and had also sold all of their Massachusetts stores to Brooks in 1995, bringing some existing Eckerds and Brooks that were once Rite Aids full circle. Because Eckerd was previously owned by J.C. Penney, Eckerd stores accepted J.C. Penney charge cards. Since the merger, all Rite Aids accept J.C. Penney charge cards revenues were reported at $27 Billion For more information about Rite Aid, please visit their website at

14 Criteria Location Roadway Visibility/Signage Access Physical Condition (Interior) Physical Condition (Exterior and parking lot) Local RE Environment Position in Market / Contiguous Properties Subtenants Alternate Uses Comment The property is located on the east side of Columbia Street. This is a free-standing property facing west. It is north of the intersection of Columbia Street and Hoosac Street. Columbia Street is a two-lane road leading south to downtown Adams. There are residential and commercial properties on this road, including office space, an apartment building, a middle school and two churches. The property is set right on the road and is visible from all directions. There is signage on the east and south sides of the building. There are two points on ingress/egress to the subject property. The first is directly south of the building off of Columbia Street into the parking lot shared with the Berkshire Mill office building. The second point of ingress/egress is further south, into the same parking lot. The interior of the property is clean and in good shape. There is adequate space in the parking lot, located south of the building. The lot is shared with the Berkshire Mill office complex, located south of the subject property. The property is located in a mature real estate market with mixed-use properties along Columbia Street. Businesses in the immediate area include: Napa Auto Parts, Adams Middle School, apartment buildings and Berkshire Mill. The property is located north of downtown Adams. North: Napa Auto Center; East: Retention Basin and residential homes; South: Berkshire Mill; West: Apartment building and Adams Mills School. Berkshire Mills Associates leases the entire parking lot from Rite Aid except 70 spaces reserved for Rite Aid. The lease expires on 10/31/2012 and there are two, 5-year extension options. Current annual rent is $16,200. Restaurant, retail, bank.

15 Sales Comparables Comparable Transaction Analysis Sale Date Tenant Address City State CAP Sale Price NOI SF $/SF NOI/SF Rite Aid Comparables 26-Dec-08 Rite Aid 1080 Bald Hill Road Warwick RI 7.35% 2,780, ,330 10,800 $ $ Dec-08 Rite Aid 14 Cider Hill Road York ME 7.63% 6,050, ,615 14,680 $ $ Oct-08 Rite Aid Nutt Road and Kimberton Road Phoenixville PA 7.92% 5,550, ,560 11,180 $ $ Oct-08 Rite Aid 305 Highway 64 West Lexington NC 7.65% 2,840, ,260 14,335 $ $ Sep-08 Rite Aid 4001 Battleground Avenue Greensboro NC 7.44% 4,270, ,688 13,824 $ $ Jul-08 Rite Aid 685 N. Main Street Greensburg PA 7.60% 5,400, ,400 14,564 $ $ Jun-08 Rite Aid 302 W Main St. Hartford MI 7.87% 1,570, ,559 10,167 $ $ Jun-08 Rite Aid 8 Gayle Drive Berkeley Springs WV 7.75% 1,570, ,675 11,348 $ $ Mar-08 Rite Aid 325 S. Main Street Burgettstown PA 7.85% 1,652, ,682 11,005 $ $ Feb-08 Rite Aid 335 Main Street Greenville PA 7.23% 4,400, ,120 11,157 $ $ Jan-08 Rite Aid 1470 Tittabawassee Road Kochville Township MI 7.16% 3,850, ,660 14,564 $ $ Jan-08 Rite Aid 5 East Main Street Nanticoke PA 7.64% 3,225, ,390 11,060 $ $22.28 Mean 7.59% $3,596,417 $272,162 12,390 $ $21.70 High 7.92% 6,050, ,615 14,680 $ $39.32 Low 7.16% 1,570, ,675 10,167 $ $10.72 The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness

16 21 Columbia Street Adams, MA Demographics Report 1.00 Mile Ring 3.00 Mile Ring 5.00 Mile Ring POPULATION 1990 Population 6,815 9,902 17, Population 6,248 9,237 16,062 % Population Change % % % 2007 Total Population 6,020 8,917 15, Total Population 5,902 8,768 15,121 % Population Change % % % % Population Change % % % 2007 Total Households 3,021 4,269 6, Total Households 3,034 4,288 7,024 % Households Change % 2.35 % 1.07 % % Households Change % 0.45 % 0.83 % 2007 White Population 5,847 8,645 14, Black Population American Indian/Alaska Native Asian/Hawaiian/Pacific Islander Other Population (Incl 2+ Races) Hispanic Population Non-Hispanic Population 5,935 8,816 15, Per Capita Income $23,493 $23,191 $21, Median Household Income $30,745 $34,162 $33, Average Household Income $46,815 $48,440 $47, Household Income < $10, Household Income $10,000-$14, Household Income $15,000-$19, Household Income $20,000-$24, Household Income $25,000-$29, Household Income $30,000-$34, Household Income $35,000-$39, Household Income $40,000-$44, Household Income $45,000-$49, Household Income $50,000-$59, Household Income $60,000-$74, Household Income $75,000-$99, Household Income $100,000-$124, Household Income $125,000-$149,

17 2007 Household Income $150,000-$199, Household Income $200,000-$249, Household Income $250,000-$499, Household Income $500, Average Household Size Total Owner Occupied Housing Units 1,735 2,728 4, Total Renter Occupied Housing Units 1,265 1,545 2, Total Daytime Population 5,496 8,153 13, Total Daytime Work Population 2,260 3,449 6, Total Establishments HOUSEHOLDS 1990 Households 3,051 4,255 7, Households 2,946 4,171 6,892 % Households Change % % %