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  1. Freeway Industrial 1600 – 2060 Chicago Ave and 1614-1616 Marlboro Ave, Riverside, CA 92507 MIKE TANNER Principal mtanner@psrs.com (310) 440-2304 CA RE# 04170108 ANDREW SUBLETT Associate asublett@psrs.com (310) 440-2307 $30,000,000 Loan Request 11911 San Vicente Boulevard, Suite 390 Los Angeles, California 90049 Phone: (310) 471-1911 Fax: (310) 440-2319 www.psrs.com This offering is subject to prior placement, withdrawal, cancellation, or modification without notice. The information contained herein has been carefully compiled from sources we consider reliable, and while not guaranteed as to completeness or accuracy, we believe it to be correct as of this date. The proforma revenues and expenses set forth in this brochure do not constitute a representation, warranty, or guaranty of any of the numbers set forth herein or of any economic value attributable to the property or income that may be derived therefrom. Independent estimates of proforma revenues and expenses should be developed before any decision is made on whether to invest in the property. -

  2. Salient Facts Property:1600-2060 Chicago Ave and 1614-1616 Marlboro Ave, Riverside, CA Property Type:Industrial Year Built: 1980 Financing Request: The borrower has requested the following loan terms to finance their property: Amount $30,000,000 Type Refinance Rate Best Available Term 10 Amortization 30 Underwriting Ratios: NOI $2,509,057 Cap Rate 6.00% Estimated Value$42,000,000 Debt Coverage Ratio 1.38 Loan to Value 72% Description:Our subject property is 480,964sf of industrial space spread across 17 buildings in a large industrial park setting. The property is off the CA-60 and I-215 interchange in Riverside. All of the buildings are masonry construction (cinder block) with composite roofs. Clear heights are in the 16’ range . Total acreage is approximately 25 acres bound by Marlboro Ave to the north and Chicago Ave to the west. Generally three sides of each building provide parking which means there is ample space for cars and parking. Borrower: John Saunders is an excellent borrower of ours. Through his successes in real estate ownership, he has become one of Orange County’s largest and most successful commercial real estate owners through the application of proactive management. He is currently the owner of over 4 million square feet of commercial real estate, primarily in Orange County, but with additional assets in Nevada and Hawaii. His net worth is approximately $180,000,000. He is partnered with MCA Realty on this deal.

  3. Market Information These statistics are pulled from industrial space within 2.5 miles of our subject. These statistics include all the available industrial space (warehouse, etc) so the rent figures are an average. More accurate information on rents is found in the rent comp section later in this package. It can be seen from this info that there industrial market is both broad and deep with over 20 million square feet of space in the 2.5 mile radius. The average sales price for industrial space was $148/sf in the last year with cap rates down at the 6.0% level. Riverside, as part of the inland empire, took its lumps in the recession between 2009 and 2011. However the market rebounded quite quickly with vacancies dropping back below 10% in the soft economy of 2012 and below 5% in early 2014.

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  7. Underwriting The borrower acquired the property 15 months ago so we have limited operating history from them. Above is their trailing 12 along with our proforma of expected performance. The borrower’s management expense has been high for the past 12 months as they’ve been actively moving tenant rents up to market and been very hands on in maximizing the investment. We expect this figure to normalize out to around 3% (which is consistent in the market.

  8. Lease Comps Based on the above rent comps, we’re seeing rents in the area for similar properties range from $17-27/SF, which still puts our rents below average and gives us confidence that our current rents are fully supportable in this market.

  9. Sale Comps We conservatively underwrote our property with a for sale value of $137.80/SF. Based on the comps we found in the area for similar properties, we estimate that our property value is in the $185-210/SF range.

  10. Location

  11. Location Neighboring Industrial Space

  12. Location

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  29. Pacific Southwest Realty Services www.psrs.com

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