About theInvestment...Walker’s Paradise (Walk Score® of 99) and Excellent Transit (Transit Score® of 82) Within walking distance to 7 Fortune 500 corporate HQ’s, riverfront parks

About the Investment

INVESTMENT SUMMARY

Marcus & Millichap is pleased to present the exclusiveopportunity to purchase the downtown office buildinglocated at 125 E. Court St., Cincinnati, OH 45202. Thebuilding is comprised of ten (10) stories of office spacetotaling approximately 98,036 SF with first (1st) floorretail space, and a 61,500 SF 164-car parking garageattached at the rear of the facility. Tenants in thebuilding enjoy the convenience of a separate parking-garage-elevator providing immediate access to theoffice tower lobby. The exterior perimeter of thebuilding is wrapped with glass, providing excellentnatural light in open floor plans.

125 East Court Street is located within Cincinnati’sCentral Business District as well as Hamilton County’sCourt House District, with the county courthouse andadministrative offices immediately adjacent to thebuilding. Law firms and Government Tenants takeadvantage of the building’s proximity to theseoperations. In addition, the corporate headquarters ofthe Kroger Company within 2 blocks, the nearbyFinancial District and walking distance to 7 Fortune500 Companies gives tenants within the building astrategic location to do business.

125 EAST COURT STREET, CINCINNATI, OH 45202

Marcus & Millichap makes no representations as to the accuracy of the information contained herein. Buyer must verify all information and bears all risk for any inaccuracies.

I N V E S T M E N T S U M M A R Y B U I L D I N G D E S C R I P T I O N L O C A T I O N O V E R V I E W L O C A L A E R I A L D E V E L O P M E N T S F I N A N C I A L S M A R K E T O V E R V I E W P R O P E R T Y R E P O R T D E M O G R A P H I C S

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Investment Highlights

INVESTMENT SUMMARY125 EAST COURT STREET, CINCINNATI, OH 45202



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Downtown multi-tenant office building showing 89.16% occupancy in the fast-growing Cincinnati CBD submarket. Average rent for occupied GLA is 16% belowMarket. Property’s average rent is $16.52/SF and Cincinnati CBD market is $19.60/SFfor similar office properties.

164 space parking garage, 1.66 spaces/1000 SF, among the top 5% of coveredparking ratios across all office buildings in downtown Cincinnati CBD.

Parking upside due to growing demand and increasing rates. In 2019, there were38,946 parking spaces within Downtown, approximately 90% are reserved.

$1.1+ Billion inconsideration for completed, proposed and under constructiondowntown developments. The highlight of which is a $90+ million mixed-use projectthat includes Cincinnati’s first downtown supermarket in nearly 45 Years. It alsofeatures a 550-Space public parking garage and 139 luxury apartments across thestreet from subject property. In total, Nearly $4.5B in projects under constructionwithin the Cincinnati MSA.

Benefits from easy access to several major highway systems — I-75 north and south;I-71 north and south; I-471 south. Less than 20-minutes from NKY/CincinnatiAirport.

The building is within 1 block of the Court House and within proximity to theWashington Park Redevelopment, Over-the-Rhine, Hard Rock Casino, and numerousother amenities including fine dining, fitness centers, entertainment, and night life.

Downtown Cincinnati has some of the highest density of jobs in the country at 67.82per acre. 7.87% higher than Downtown Columbus, 24.46% higher than DowntownCharlotte, 34.81% higher than Downtown Indianapolis, 41.13% higher thanDowntown Louisville, and 55% higher than Downtown Kansas City.

Dense demographics with over 300,000 residents within a 5-mile radius.

Walker’s Paradise (Walk Score® of 99) and Excellent Transit (Transit Score® of 82)

Within walking distance to 7 Fortune 500 corporate HQ’s, riverfront parks andentertainment, the Cincinnati Reds, & Bengals, FC Cincinnati’s new stadium site,and Duke Energy Convention Center.

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PROPERTY DESCRIPTIONProperties: Downtown Multi-Tenant Office BuildingsProperties Address: 125 East Court StreetCity, State, ZIP: Cincinnati, OH 45202Year Built: 1984Years Renovated: 2011 – 2018 Buildings GLA: 98,036-SqftParking Garage Area: 61,500-SqftBuildings Floors: Ten-Story BuildingLot Size: 0.42± AcresOccupancy: 89.16%Type of Construction: Reinforced ConcreteParking Spaces & Ratio: 164- 1.66 Spaces/1,000 SF Walk Score: Walker’s Paradise (99)Roof: Replaced 2011 (Warranty through August 2027)HVAC 60 Water-Source Heat Pumps

4Marcus & Millichap makes no representations as to the accuracy of the information contained herein. Buyer must verify all information and bears all risk for any inaccuracies.


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DOWNTOWN OFFICE & PARKING GARAGE

54Marcus & Millichap makes no representations as to the accuracy of the information contained herein. Buyer must verify all information and bears all risk for any inaccuracies.


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The City's diverse economic base has been and continues to be asource of financial stability for the City. Among its prominentmanufacturing groups are transportation equipment, whichincludes aircraft engines and auto parts; food and kindredproducts; metal working and general industrial machinery;chemicals; fabricated metal products; printing and publishing.Several Fortune 500 corporations are headquartered in the City'sregion, and over 400 Fortune 500 firms have operations in theMetropolitan Area.

According to a report released by the Federal Reserve Bank ofCleveland in August 2018, unemployment rate has decreased to3.7% as of April 2018, compared to 4.1% in May 2017. The reportstates that the “Cincinnati metro area saw stronger employmentgains (in percentage terms) than did Ohio in all majoremployment sectors except construction and professional andbusiness services.” The research shows that two sectorsexperienced notably higher employment growth locally: leisureand hospitality and construction. Professional and businessservices experienced a decline locally.

In 2018, Local home prices increased by 6.1% from the previousyear, compared to 6.6% increase in Ohio and 8.5% increasenationally. The Fed Report notes that the growth rate has slowedcompared to the previous year, but the “recent growth ratesremain well above those seen in the previous economicexpansion.”

CITY OF CINCINNATILOCAL ECONOMY

CINCINNATI MSA LARGEST EMPLOYERS# EMPLOYER # EMPLOYEES1 Kroger Co. 21,2632 Children’s Hospital Medical Center 15,4293 Cincinnati/NKY International Airport 12,6824 TriHealth Inc. 12,0005 UC Health 11,2416 University of Cincinnati 10,5517 General Electric 10,5008 Mercy Health 10,4429 Procter & Gamble 10,00010 St. Elizabeth Healthcare 8,413

Source: Business Courier 2017-18 Book of Lists

CINCINNATI MSA LARGEST COLLEGES# Higher Education Institutions # Enrollment1 University of Cincinnati 44,7832 Miami University 24,2823 Northern Kentucky University 14,5664 Cincinnati State Tech. & Community College 8,8075 Xavier University 6,7986 Gateway Community & Tech. College 4,4507 Thomas More College 2,0658 Mount St. Joseph University 2,0119 Ivy Tech Community College 1,97310 Sinclair Community College 1,114

The region's largest college or university, the University of Cincinnati, has significantresearch and contract activity. During the 2015, 2016, and 2017 fiscal years, theUniversity of Cincinnati and its affiliates received $397 million, $429 million, and $193million respectively, in federal, state, city/county, and non-government agency grants,contracts, and awards. According to the National Science Foundation ranking for federalfunding of major research the University of Cincinnati stands among the top 50research universities in the nation.

Source: Business Courier 2017-18 Winter Book of Business Lists



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228 E 7th St.Uncovered/Open Lot

$175631 Sycamore St.Uncovered/Open Lot

$155

824 Main St.Uncovered/Open Lot

$150

901 Main St.Uncovered/Open Lot

$135

127 E 8th St.Uncovered/Open Lot

$130

712 Walnut St.Uncovered/Open Lot

$180120 E 7th St.

Garage

$160

174 E Central PkwyUncovered/Open Lot

$175

1121 Walnut St.Uncovered/Open Lot

$130*SUBJECT PROPERTY

Garage

$160

406 Main St.Garage

$205353 Sycamore St.

Garage

$210

412 Vine St.Garage

$205

551 Walnut St.Garage

$210

516 Race St.Garage

$210

113 W 6th St.Garage

$180

629 Vine St.Garage

$155

731 Elm St.Garage

$105

710 Elm St.Garage

$120PARKING RATES(Per Month/Space)

*Subject Property currently underwritten at $135/month (164 Spaces), parking garage is marketed at $160/month online (Fully Occupied).Prices sourced on 1/24/20 from https://www.bestparking.com/cincinnati-oh-parking/monthly-parking/White Tabs = covered/garage parkingBlue Tabs= uncovered/open lot parking

https://www.bestparking.com/cincinnati-oh-parking/monthly-parking/

zKroger Headquarters

8th and Main Development8th & Main Project

Kroger Downtown Mixed-UseCompleted: $90+ Million Development

Court Street CondosCondos Project

The ColumbiaColumbia Project

1118 Sycamore1118 Project

Streetcar Route



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Kroger Mixed-Use ProjectDowntown Kroger Spurs Revival

RESEARCH ARTICLES LINKED BELOW DESCRIPTIONS:

https://www.neyer.com/8th-and-main-shaping-the-central-business-district-skyline/

https://www.bizjournals.com/cincinnati/news/2019/10/15/get-a-look-at-3cdc-s-court-street-condos-photos.html

https://www.3cdc.org/project/the-columbia/

https://www.connect.media/acres-funds-mxu-in-cincys-over-the-rhine-district/

https://www.cincinnati.com/story/money/2019/05/13/court-street-downtown-kroger-spurs-revival/3473428002/

https://www.3cdc.org/project/court-walnut/

8th and Main Residential Development$28,300,000 apartment development includes 125 luxury apartments. Estimated Completion in Q2, 2020

Kroger Downtown Mixed-Use$90,600,000 mixed use development including a grocery store, 139 apartment spaces and 560 parking spots. This development received $18.5 million grant from the city for capital improvements. Completed in Q4, 2019

1118 Sycamore$40,000,000 mixed use development estimated to be complete in Q4, 2020. The development will include about 150 apartments and 7,000 sq.ft. of retail space

The ColumbiaRedevelopment of a critical corner in Over the Rhine,

adding $10,800,000 of affordable and market rate housing

Court Street Condos$9,000,000 mixed use redevelopment with 16 residential condos, 6 commercial spaces. Completed in Q3, 2019

Kroger HeadquartersLargest supermarket chain in the US by revenue ($121.16 Billion for 2019 fiscal deal). Kroger has 453,000+ employees nationwide.

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The Columbia

Court Street Condos

zKroger Headquarters

1118 Sycamore

Streetcar Route8th and Main Development

Kroger Downtown Mixed-Use

Second National Bank Apartments

Procter & Gamble

Gwynne Building Conversion

Duttenhofer BuildingThe Exchange

Central Trust Tower Conversion

Macy’s Store The Provident

Kinley Hotel

Central Trust Tower Conversion$102,900,000 development converting the office building into a mixed-use building with 262 apartments

The Provident $38,000,000 conversion of historical office space into 160 market rate apartments. Completion set for Q1, 2020.

The Exchange$22,000,000 redevelopment including first floor retail with a mix of office and residential. Completed in Q3, 2019

Kinley Hotel$19,000,000 project planning to put in 94 guest rooms and suites in the former Jeweler’s building. Completion set for Q1, 2020

Macy’s Downtown Store3CDC plans to covert into mix-use with offices and street level commercial space.

Gwynne Building Conversion$53,500,000 transformation of the historical office building into a 181-room high end boutique hotel. Set for completion in Q2, 2021.

Duttenhoffer Building$27,500,000 redevelopment proposed to convert the existing office space into a 130-room hotel with a restaurant, bar and meeting space.

Second National Bank Building$20,000,000 development converting the existing office building and adjacent parking lot into an apartment building with a parking garage.

Procter and GambleThere are 10,000 P&G employees working in the Greater Cincinnati Area. P&G did $67.7 Billion in net sales in 2019.



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COURT AND WALNUT (COMPLETED): The City provided an $8.5 million grant from the UrbanRedevelopment Tax Increment Equivalent Fund for a transformative mixed-use project on theborder of downtown and Over-the-Rhine. Partnering with The Kroger Co., North AmericanProperties, the Cincinnati Center City Development Corp. (3CDC), and Rookwood Properties, theCity is helping develop a $90.6 million project that will include Cincinnati’s first downtownsupermarket in nearly 45 years. It also will feature a 550-space public parking garage on thestreetcar line, and 139 luxury apartments.

50 COURT STREET (COMPLETED): 3CDC plans a major redevelopment of six buildings on thenorth side of Court Street by Kroger's headquarters. The project will create 15 to 20 residential unitsand street-level commercial space. Total cost: $9,000,000.

SECOND NATIONAL BANK BUILDING (PROPOSED): With the purchase of the building and theadjacent parking lot, the developer plans to convert the existing office building into about 60apartments. Then, a six-story parking garage with space for 200 cars would be built on the lot,possibly topped by another 40 to 60 apartments, which would be aimed at Millennial renters. TotalCost: $20,000,000.

15 W. SIXTH STREET (PROPOSED): Anderson Birkla proposes to renovate the roughly 600,000square-foot property at 15 W. Sixth St., formerly known as the Terrace Plaza Hotel. The building islargely vacant, except for some ground-floor retail. The project will yield approximately 224 market-rate apartments, as well as additional ground-floor retail. Also, the project will include 292 parkingspaces.

642 VINE STREET (UNDER CONSTRUCTION): Pearl Capital Management, LLC is renovating thehistoric Provident Bank Building. When completed, the $37.5 million project will convert 140,000square feet of Class C office, with a 10 percent occupancy rate, into 160 residential units rented at acost of 10-15 percent less than the surrounding inventory. Also, it will renovate 13,000 square feetof retail space.

UNION TERMINAL (COMPLETED): Union Terminal is currently undergoing a $219 millionrenovation. Union Terminal is home to the Cincinnati Museum Center. The building isapproximately 500,000 square feet, and construction is expected to be completed in early 2019. Theproject was awarded $5 million in historic tax credits.

719-721 MAIN STREET (UNDER CONSTRUCTION): Originally planned as condos, NorthAmerican Properties and NorthPointe Group are now looking at this project as a potential apartmentdevelopment, using the same plan that was approved for a condo tower but reconfiguring theinterior. Total Cost: $28,300,000.

CINCINNATI CBDMAJOR INITIATIVES & DEVELOPMENTS

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37 WEST SEVENTH STREET (UNDER CONSTRUCTION): Vision Hospitality is building a newboutique hospitality brand will be called Kinley in the former Jeweler's Exchange office building. Itwill have 94 guest rooms and suites. Total Cost: $19,000,000.

106 WEST SEVENTH STREET (UNDER CONSTRUCTION): Conversion of the former McHahn'sbuilding into an 84-room TownePlace Suites by Marriott. Total Cost: $6,000,000.

314 NINTH STREET (PROPOSED): Cincinnati Public Radio plans to build a new headquarters andstudio in downtown Cincinnati. Total Cost: $15,000,000.

602 MAIN STREET (PROPOSED): The new owner of the Gwynne Building plans to transform thehistorical office building into a 181-room high-end boutique hotel. Total Cost: $53,500,000.

299 E. SIXTH STREET (PROPOSED): A conversion of existing vacant office space to a 130-roomhotel with restaurant, bar and meeting space. Total Cost: $27,500,000.

311 PIKE STREET (COMPLETED): An Autograph Collection hotel that will have 106 guest rooms,10,800 square feet of meeting space, a restaurant, bar, private dining room, outdoor dining andpatio overlooking the park and a rooftop terrace. Total Cost: $35,000,000.

105 E. FOURTH STREET (PROPOSED): The three-building complex is planned to become amixed-use property that could include up to three hotels, office space, retail and restaurants.Total Cost: $100,000,000.

6 E. FOURTH STREET (UNDER CONSTRUCTION): SREE Hotels plans to convert the former officebuilding into a 140- to 160-room hotel. Total Cost: $12,000,000.

9 W. FOURTH ST. (PROPOSED): City Club Apartments LLC is looking at converting the officebuilding into a mixed-use building with 262 apartments. Total Cost: $102,900,000.

432 WALNUT STREET (PROPOSED): The region's first Kimpton Hotel & Restaurants hotel willtransform a nearly vacant class B office building into a 153-room boutique hotel.Total Cost: $48,300,000.

118 W. FOURTH STREET (UNDER CONSTRUCTION): A 264-unit apartment tower above a 580-space parking garage with 30,000 square feet of first floor commercial space.Total Cost: $116,000,000.

231 WEST FOURTH STREET (UNDER CONSTRUCTION): The Loring Group has acquired sixproperties along West Fourth Street with plans to invest $20 million into the corridor.Total Cost: $20,000,000.

180 WALNUT STREET (PROPOSED): New plans for this office pad at the Banks call for 11 floors ofoffice space totaling more than 304,000 square feet of space. Total Cost: $90,000,000.

1118 SYCAMORE STREET (UNDER CONSTRUCTION): A planned mixed-use development thatwould include about 150 apartments, parking and 7,000 square feet of retail space.Total Cost: $40,000,000



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OVER $1 BILLION INCONSIDERATION FOR DOWNTOWN DEVELOPMENTS700+ Residential Units | First Downtown Supermarket | 7 Hotel Conversions 900+ Rooms

Market Buildings Inventory SF Avg Est. Rent / SF VacancySubject Property 1 98,036 $16.52 11.00%

Cincinnati CBD Submarket (2-4 Star) 184 20.5M $19.60 7.50%Cincinnati CBD Submarket Overall 204 21.4M $20.04 7.20%

Cincinnati Market (2-4 Star) 4,824 99.3M $18.94 8.70%Cincinnati Overall Market 5,624 103M $18.93 8.40%

TRAILING 12 MONTHS SALES ACTIVITY [299 OFFICE BUILDINGS SOLD IN CINCINNATI]

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Cincinnati CBD is the largest office submarket, with 21.8 million SF of space (about 21% of the overall market) and a total asset value of $2.3 billion. Fundamentals are solid, with vacancy below themarket average and modest rent growth. Demand remains tepid, however, with absorption falling negative in the first half of 2019. A major driver of improving fundamentals is the conversion of vacantoffice buildings into apartments and hotels. Developers continue to show interest in acquiring office space, with sales volume increasing in the second half of the cycle. Fundamentals are likely toremain stable through the forecast, as little development activity is in the pipeline.

SUMMARY: CINCINNATI CBD SUBMARKET

Unlike many major cities, rents in the Cincinnati CBD are not the highest in the metro, falling about 15% lower than rents in Kenwood, the priciest submarket. Asking rents sit at nearly $20.00/SF, risingjust 8% since 2010. Properties rated 4 & 5 Star achieve a premium, with rents about 25% higher than space rated 3 Star and below. While representing a small sample size, the newest properties achievethe greatest premium, about 20% above the average for 4- & 5-Star space.

Total employment in Cincinnati grew by 1.8% as of November, slightly outperforming the national average of 1.5%. Office-using employment performed even better, with gains of 3%. Demand for officespace, however, is not concentrated in the CBD, but rather in adjacent submarkets like Covington/Newport. Although demand for office space in the CBD is weak, vacancy has trended downward thiscycle and currently sits around 7.2%.

This compression is largely due to the conversion of vacant office space into alternative uses such as apartments and hotels. Recent examples of conversion activity include The Provident at 642 Vine St.,a 162,500-SF office building being converted into 161 apartments.

Eagle Realty Group LLC signed the largest lease in 2019, leasing 126,000 SF in the Columbia Plaza building. Last year’s largest lease was the move of Kroger Digital Headquarters from Blue Ash todowntown. Kroger Digital now occupies 65,620 SF at 221 E Fourth St., moving 600 existing jobs to the CBD with plans to expand to over 1,000 employees.

Development activity in the Cincinnati CBD has been limited this cycle, with the main story being the removal rather than the addition of space. Since 2010, just three properties totaling 1.5 million SFhave delivered in the CBD. One of Cincinnati’s most iconic buildings, the 5 Star, 870,400-SF Great American Tower in Queen City Square, delivered in 2011 and is 98% occupied. The most recentdelivery is The Banks, a 4 Star, 358,800-SF property that delivered in 2016 and is fully occupied by General Electric’s Global Operations Center. The bulk of inventory (11.8 million SF) in the CincinnatiCBD consists of 4 Star properties, with the Great American Tower being the only 5 Star property.

Transaction activity in the CBD last year was modest, totaling $58.7 million - down about 30% from the previous year, but in line with the long-term average. Prices have also fallen in 2019, averagingnearly $90/SF.

The largest sale of 2019 occurred in July when New York-based Group RMC purchased the Huntington Center at 525 Vine Street for $24.5 million. Originally built in 1984, the 4 Star, 386,000-SF assetwas renovated in 2006, with additional renovations and upgrades now underway. In August, City Club Apartments, LLC acquired the Central Trust Tower for $11.5 million. Less than half leased at thetime of sale, the 295,000-SF property plans to be converted into 262 apartments and retail space. The buyer also redeveloped 309 Vine Street into the City Club Apartments in 2018.

VACANCY / AVAILABILITY: CINCINNATI CBD SUBMARKET

RENT: CINCINNATI CBD SUBMARKET

CONSTRUCTION: CINCINNATI CBD SUBMARKET

SALES: CINCINNATI CBD SUBMARKET



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Tenant Name GLA (SF) % Share Lease From Lease To Monthly Rent Annual Rent R/SF Next Rent Increase Lease Type Options

Dunkin’ Donuts 915 0.93% 10/1/2013 11/30/2023 $1,877 $22,521 $24.61 Annual 3% Increases Gross 2, 5-Year options with 3% annual increases

Rubenstein 4,770 4.87% 1/1/2013 12/31/2021 $5,811 $69,729 $14.62 Annual 2% Increases Gross 1, 2 Year option with 2% annual increases

Daymon Worldwide, Inc 20,614 21.06% 8/1/2013 1/31/2022 $28,894 $346,724 $16.82 Annual 2.5% Increases Gross 3, 3-Year Options at Market Rate

Tom & Chee 2,215 2.26% 12/1/2014 11/30/2024 $3,793 $45,518 $20.55 Annual 2% Increases NNN + Management 3, 5-Year Options at Market Rate

E&J Gallo Winery Paying an additional $5,734 annual fee towards TI until 9/30/2021 Included in rent

3,140 3.21% 5/1/2009 9/30/2021 $4,501 $48,278 $15.38 Annual 2.5% Increases Gross 1, 3-year option with 2.5% annual increases

Industrial Commission 24,000 24.52% 7/1/2011 6/30/2021 $27,300 $327,600 $13.65 N/A Gross N/A

Clements, Taylor, Butkovich 5,990 6.12% 2/1/2015 5/31/2021 $6,700 $80,399 $13.42 $82,007 Starting 6/1/2020 Gross 1, Five-Year option at Market Rent

The Hamilton Board of Juvenile Justice Tenant pays $216,951 towards base rent and $114,280 annual TI reimbursements until 10/31/2020 | Option rent starts at $221.232.

15,289 15.62% 11/1/2014 10/31/2021 $27,603 $331,230 $21.66 Annual 2% Increases Gross 5, 1-Year Options

Loeb, Vollman & Frie 3,717 3.80% 9/7/2012 2/28/2022 $4,910 $60,387 $16.25 Annual 2.5% Increases Gross 1, 2 Year option with 2.5% increases

Flourish Psychotherapy, LLC 3,148 3.22% 12/1/2019 11/30/2022 $3,935 $47,220 $15.00 Annual 3% Increases Gross 1, 3 Year Option

Republic National 3,470 3.55% 5/1/2017 8/31/2025 $5,170 $62,040 $17.88 Annual 3% Increases Gross N/A

Vacant (#203) 2,675 2.73% Pro Forma$3,344

Pro Forma$40,125

Pro Forma$15

Annual 2% Increases Pro FormaGross

Vacant (#400) 3,661 3.73% Pro Forma$4,576

Pro Forma$54,915

Pro Forma$15


Vacant (#410) 2,801 2.86% Pro Forma$3,501

Pro Forma$42,015

Pro Forma$15


Vacant (#110) 1,631 1.66% Pro Forma$1,155

Pro Forma$13,863

Pro Forma$8.50


Total GLA: 98,036 100% Total Current Rent: $120,137 $1,441,647 $16.52

Occupied: 89% = 87,268-SF | Vacant: 11% = 10,768-SFPro Forma$12,576

Pro Forma$150,918

Pro Forma$14

Total $132,712 $1,592,565 $16.24

Marcus & Millichap makes no representations as to the accuracy of the information contained herein. Buyer must verify all information and bears all risk for any inaccuracies. 13


For the Years EndingYear 1

Mar-2021Year 2

Mar-2022Year 3

Mar-2023Year 4

Mar-2024Year 5

Mar-2025Year 6

Mar-2026Year 7

Mar-2027Year 8

Mar-2028Year 9

Mar-2029Year 10

Mar-2030

Potential Gross IncomeBase Rental IncomeAbsorption & Turnover Vacancy

$1,579,203-

$1,614,451($104,740)

$1,609,093($4,586)

$1,666,696 ($46,414)

$1,697,921 ($109,878)

$1,741,554 ($17,279)

$1,780,803 ($46,992)

$1,814,203 ($76,584)

$1,850,028 ($54,235)

$1,886,162 ($49,867)

Schedule Base Rental Income 1,579,203 1,509,711 1,604,507 1,620,282 1,588,043 1,724,275 1,733,811 1,737,619 1,795,793 1,836,295

Total Reimbursement Income $18,528 $19,066 $19,574 $22,310 $27,655 $30,219 $31,116 $32,047 $32,949 $33,940Total Parking Income $260,366 $250,618 $275,518 $277,735 $273,857 $299,526 $303,753 $305,786 $321,410 $331,919

Total Potential Income $1,858,097 $1,779,395 $1,899,599 $1,920,327 $1,889,555 $2,054,020 $2,068,680 $2,075,452 $2,150,152 $2,202,154General Vacancy -$130,067 -$27,149 -$128,707 -$91,258 -$30,082 -$127,712 -$101,105 -$74,059 -$100,072 -$107,774

Effective Gross Income 1,728,030 1,752,246 1,770,892 1,829,069 1,859,473 1,926,308 1,967,575 2,001,393 2,050,080 2,094,380

Operating Expenses

Pest Control $1,057 $1,089 $1,121 $1,155 $1,190 $1,225 $1,262 $1,300 $1,339 $1,379Interior Plants $794 $818 $842 $868 $894 $920 $948 $977 $1,006 $1,036Window Washing $2,609 $2,687 $2,768 $2,851 $2,936 $3,025 $3,115 $3,209 $3,305 $3,404Trash Removal $945 $973 $1,003 $1,033 $1,064 $1,096 $1,128 $1,162 $1,197 $1,233Elevator Maintenance $24,535 $25,271 $26,029 $26,810 $27,614 $28,443 $29,296 $30,175 $31,080 $32,013Elevator R&M $2,345 $2,415 $2,488 $2,562 $2,639 $2,718 $2,800 $2,884 $2,971 $3,060

HVAC Repairs $28,431 $29,284 $30,162 $31,067 $31,999 $32,959 $33,948 $34,967 $36,016 $37,096Janitorial $81,068 $83,500 $86,005 $88,585 $91,243 $93,980 $96,799 $99,703 $102,695 $105,775Cleaning Supplies $11,464 $11,808 $12,162 $12,527 $12,903 $13,290 $13,689 $14,099 $14,522 $14,958Trash Removal $8,460 $8,714 $8,975 $9,244 $9,522 $9,807 $10,102 $10,405 $10,717 $11,038R&M $32,137 $33,101 $34,094 $35,117 $36,170 $37,256 $38,373 $39,524 $40,710 $41,931Life Safety $8,654 $8,914 $9,181 $9,456 $9,740 $10,032 $10,333 $10,643 $10,963 $11,292Security $70,843 $72,968 $75,157 $77,412 $79,734 $82,126 $84,590 $87,128 $89,742 $92,434Supplies $2,153 $2,218 $2,284 $2,353 $2,423 $2,496 $2,571 $2,648 $2,727 $2,809Maintenance Service Time $52,465 $54,039 $55,660 $57,330 $59,050 $60,821 $62,646 $64,525 $66,461 $68,455Utilities $124,247 $127,974 $131,814 $135,768 $139,841 $144,036 $148,357 $152,808 $157,392 $162,114General Administrative $4,119 $4,243 $4,370 $4,501 $4,636 $4,775 $4,918 $5,066 $5,218 $5,374Admin Salaries & Benefits $15,000 $15,450 $15,914 $16,391 $16,883 $17,389 $17,911 $18,448 $19,002 $19,572Real Estate Taxes $259,502 $267,287 $275,306 $283,565 $292,072 $300,834 $309,859 $319,155 $328,729 $338,591Insurance $19,587 $20,175 $20,780 $21,403 $22,045 $22,707 $23,388 $24,090 $24,812 $25,557Management $69,121 $70,090 $70,836 $73,163 $74,379 $77,052 $78,703 $80,056 $82,003 $83,775Parking Garage R&M $20,962 $21,591 $22,239 $22,906 $23,593 $24,301 $25,030 $25,781 $26,554 $27,351Parking Garage Labor $22,410 $23,082 $23,775 $24,488 $25,223 $25,979 $26,759 $27,561 $28,388 $29,240

Total Operating Expenses $862,908 $887,691 $912,965 $940,555 $967,793 $997,267 $1,026,525 $1,056,314 $1,087,549 $1,119,487

Net Operating Expenses $865,122 $864,555 $857,927 $888,514 $891,680 $929,041 $941,050 $945,079 $962,531 $974,893

Leasing & Capital CostsTenant Improvements $161,520 $261,661 $21,849 $80,881 $231,279 $107,635 $81,826 $218,779 $135,743 $89,413Leasing Commissions $25,657 $43,687 $4,486 $17,973 $38,899 $22,523 $15,511 $30,559 $27,093 $16,461Capital Reserve $19,607 $19,607 $19,607 $19,607 $19,607 $19,607 $19,607 $19,607 $19,607 $19,607

Total Leasing & Capital Costs $206,784 $324,955 $45,942 $118,461 $289,785 $149,765 $116,944 $268,945 $182,443 $125,481

Cash Flow Before Debt Service & Taxes $658,338 $539,600 $811,985 $770,053 $601,895 $779,276 $824,106 $676,134 $780,088 $849,412



Hamilton Co. in suite 801 will stop paying TI reimbursements starting 11/1/2020 ($114,280 Annually)

DOWNTOWN OFFICE & PARKING GARAGE INCOME STATEMENT

Year 1 $P/SF Year 3 $P/SFScheduled Base Rental Income $1,579,203 $16.11 $1,609,093 $16.41 Absorption & Turnover Vacancy ($4,586) ($0.05)

Total Reimbursements $18,525 $0.19 $19,574 $0.20

Parking Income (164 Spaces) $260,366 $2.66 $275,518 $2.81 Potential Gross Income $1,858,097 $18.95 $1,899,599 $19.38

General Vacancy ($130,067) ($1.33) ($128,707) ($1.31)

Effective Gross Income $1,728,030 $17.63 $1,770,892 $18.06

Less: Operating Expenses $0.00

CAM ($471,326) ($4.81) ($500,029) ($5.10)

Parking Garage ($43,372) ($0.44) ($46,014) ($0.47)

Insurance ($19,587) ($0.20) ($20,780) ($0.21)

Real Estate Taxes ($259,502) ($2.65) ($275,306) ($2.81)

Management (4% EGI) ($69,121) ($0.71) ($70,837) ($0.72)

Total Operating Expenses$862,908 $8.80 $912,965 $9.31

Net Operating Income $865,122 $8.82 $857,927 $8.75

Tenant Improvements $161,520 $1.65 ($21,849) ($0.22)

Leasing Commissions $25,657 $0.26 ($4,486) ($0.05)

Capital Reserve $19,607 $0.20 ($19,607) ($0.20)

Total Leasing & Capital Costs ($206,784) ($2.11) ($45,942) ($0.47)

Cash Flow Before Debt Service & Taxes $658,338 $6.72 $811,985 $8.28

PROPERTY DESCRIPTIONProperties: Downtown Multi-Tenant Office BuildingsProperties Address: 125 East Court StreetCity, State, ZIP: Cincinnati, OH 45202Years Built: 1984Years Renovated: 2011 – 2018 Buildings GLA: 98,036-SqftParking Garage Area: 61,500-SqftBuildings Floors: Ten-Story BuildingLot Size: 0.42± AcresOccupancy: 89%Type of Construction: Reinforced ConcreteParking Spaces & Ratio: 164- 1.66 Spaces/1,000 SF Walk Score: Walker’s Paradise (99)

THE OFFERING

MARKET BID



CINCINNATIOVERVIEW

The Cincinnati metro is a 15-county region located within portions ofOhio, Kentucky and Indiana that maintains a population of nearly 2.2million. The Ohio counties are Hamilton, Brown, Warren, Butler andClermont. The counties in Indiana are Dearborn, Ohio and Franklin,and the Kentucky counties are Campbell, Grant, Boone, Gallatin,Pendleton, Bracken and Kenton. Nine Fortune 500 companies arelocated in the metro and provide thousands of jobs: Kroger, Cintas,Cincinnati Financial, Proctor & Gamble, Macy’s, Fifth Third Bancorp,AK Steel Holding, American Financial Group and Western & SouthernFinancial Group. Revitalization and the addition of bars, restaurantsand services in downtown and the Over-the-Rhine neighborhood aredrawing millennials into the urban core.

METRO HIGHLIGHTS

DIVERSIFYING ECONOMYGrowth in service-oriented industries has lessened the metro’s dependence on the manufacturing and transportation sectors.

ATTRACTIVE BUSINESS ENVIRONMENTCompanies are drawn to the region’s low cost of doing business, while employees enjoy a relatively affordable place to live.

CENTRAL DISTRUBTION POINTHalf of the U.S. population and 30 major markets are within a one-day drive.



16

ECONOMY An excellent transportation system; lower property, corporate and state taxes; and state tax

credit initiatives are major incentives that draw companies. The area’s traditional employment bases in aerospace, automotive, chemistry and financial

services will continue to contribute to the metro’s economic landscape. New employment sectors also position the metro for growth, including consumer products

and creative services, information technology, and life sciences. Local research is being conducted in biomass, fuel cell, solar, and wind energy.

SHARE OF 2018 TOTAL EMPLOYMENT

MAJOR AREA EMPLOYERS

Kroger Co.

University of Cincinnati

Proctor & Gamble

Cincinnati Children’s Hospital Medical Ctr.

UC Health

TriHealth Inc.

Walmart

Mercy Health

Fifth Third Bank

GE Aviation* Forecast

MANUFACTURING11%

GOVERNMENT

HEALTH SERVICESEDUCATION AND

+OTHER SERVICES

4%

LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES

20%AND UTILITIES

TRADE, TRANSPORTATION CONSTRUCTION

PROFESSIONAL ANDBUSINESS SERVICES

1%INFORMATION

15%

4%

12% 11% 7%

15%



DEMOGRAPHICS The metro is expected to add nearly 80,000 people and approximately 37,200

households through 2023. Household incomes near the national median allow 66 percent of households to

afford to own their homes. Roughly 31 percent of residents age 25 and older have earned a bachelor’s degree;

of these residents, 11 percent also hold a graduate or professional degree.

Cincinnati offers a wide range of cultural and entertainment activities. The CincinnatiSymphony Orchestra is one of the country’s finest orchestras. Riverbend concert arena onthe banks of the Ohio River provides summer entertainment, while more than 100 museumsand galleries are located in the metro. The region has several entertainment corridorsincluding Mount Adams and the expanding Main Street district. Cincinnati offers professionalbaseball, football, hockey, soccer, tennis, volleyball, car racing and horse racing. A numberof universities have main campuses in the area, the University of Cincinnati, XavierUniversity and Northern Kentucky University. Miami University is located in nearby Oxford.

QUALITY OF LIFE

* Forecast Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s Analytics; U.S. Census Bureau

SPORTS

EDUCATION

ARTS & ENTERTAINMENT

37.82018

MEDIAN AGE:

U.S. Median:38.0

$62,3002018 MEDIAN

HOUSEHOLD INCOME:

U.S. Median:$58,800

2.2M2018

POPULATION:

Growth2018-2023*:3.6%

851K2018

HOUSEHOLDS:

4.4%Growth

2018-2023*:

2018 Population by Age

0-4 YEARS

6%5-19 YEARS

20%20-24 YEARS

7%25-44 YEARS

26%45-64 YEARS

27%65+ YEARS

14%



Office space demand advances across Ohio. Continued growth in the state issupporting heightened leasing activity and positive net absorption in all three majormarkets. Despite having the highest vacancy, Columbus office users are anticipated tooccupy more than 1 million square feet of space during 2019, the largest annual gain.The diverse local metro, which includes the state capital and Ohio State University,benefits from government departments and support firms that occupy competitiveoffice buildings. Additionally, stable employment growth is an indication that Columbusfirms will need larger footprints in the future. Cincinnati, meanwhile, nearly mirrors thestate capital in terms of economic and employment growth, which will support adecline in vacancy this year. The metro also benefits from limited construction thatfunnels nearly all new demand into existing properties.

Cleveland has mixed office fundamentals this year. Ohio’s largest metro is gainingmomentum, though gains are misaligned with the office market. Job growth will surgeto the highest rate during the current economic expansion, a welcome sign for the localeconomy. Much of the demand is outside traditional office-using sectors, which willresult in a modest increase in office vacancy. Medical office space, however, isbenefiting from a strong healthcare sector anchored by the Cleveland Clinic.Nonetheless, a revitalized downtown is attracting educated workers to the area, whichshould encourage employers to turn to the market as a low-cost alternative.

Major Ohio Metros Boast Improving Economies, Supporting Office Price Appreciation

OHIO METRO AREAS

* Cap rates trailing 12 months through 1Q19Includes sales $1 million and greater for Cincinnati, Cleveland and Columbus.Sources: CoStar Group, Inc.; Real Capital Analytics

Investment TrendsCincinnati• Northern Kentucky and core locations within Cincinnati account for about half

of all transactions in the metro. Investors, particularly owner-users, may findopportunities in suburbs, where competition for available properties is limited.

• The metro’s bright long-term outlook has tightened average cap rates to thelowest among the major Ohio markets. First-year returns averaged in the mid-7 percent range during the most recent 12-month period.

Cleveland• Investors remain optimistic about the local office market, though creative

strategies will help move assets. Buyers with a tenant in tow or the ability toreposition a local office asset can achieve outsized returns in the market.

• At approximately 8 percent, average cap rates are the highest in the state.Nonetheless, average first-year returns are only 70 basis points higher thanthe pre-recession trough.

Columbus• Columbus remains the most consistent office sales market in Ohio as

investors are attracted to the diverse local economy. Another healthy year ofinvestment activity is anticipated this year.

• Buyers acquired office assets in the market at average cap rates in the high-7percent range during the last year..

Office 2019 Outlook

VacancyY-O-Y

BasisPointChange

Metro AskingRent

Y-O-YChange

Cincinnati 11.4% -50 $16.60 2.3%

Cleveland 11.4% 10 $18.40 2.8%

Columbus 11.7% -40 $19.05 2.2%



19

• Employers generated 21,100 positions during the 12-month period ending in the first quarter, including 13,300 jobs over the past six months, as local firms accelerated the pace of hiring.

• The largest gains occurred in the professional and business services sector, which added 5,900 spots. Overall, office-using employers added 8,400 jobs, representing an increase of 3.2 percent in the last 12 months.

EMPLOYMENT

• Less than 300,000 square feet of office space came online during the past year, including approximately 85,000 square feet in the last six months. Over the last five years, inventory growth has averaged approximately 1 percent annually.

• The largest project underway is a 250,000-square-foot build-to-suit project for Medpace scheduled for completion in 2020. Approximately 900,000 square feet is under construction.

CONSTRUCTION

• Softening construction supported lower vacancy over the past 12 months. In the first quarter, the rate was 11.7 percent. Vacancy declined 30 basis points during the previous yearlong period.

• At 15.9 percent, top-tier vacancy remains significantly higher than the marketwide average despite a 70-basis-point decline over the last 12 months. Class B/C vacancy dipped 30 basis points to 9.2 percent in the first quarter.

VACANCY

• In the last 12 months, the average rent dipped to $16.46 per square foot in Cincinnati. The average rent contracted 0.1 percent in the preceding yearlong period.

• Class A rent dragged the metrowide average rent lower during the last 12 months. In the first quarter, top-tier rent was $17.80 per square foot, down 7.1 percent. In the Class B/C office buildings, average rent advanced 4.0 percent to $15.67 per square foot.

RENTS

OHIO METRO AREAS: CINCINNATI

decrease in the average asking rent Y-O-Y

0.8%basis point decrease in vacancy Y-O-Y

40square feet completedY-O-Y

280,000increase in total employment Y-O-Y

1.9%

* Forecast

1Q19 – 12-Month Trend



Northern Kentucky/Core Cincinnati Attract Most Buyers;Suburban Opportunities Overlooked

Outlook: Core locations within Cincinnatiand Northern Kentucky representapproximately 50 percent of sales in eachproperty class, while Class C dealdistribution is the most widely distributed.

VacancyRate

Y-O-YBasisPoint

ChangeSubmarket Asking

RentY-O-Y%Change

Cincinnati (City) 9.5% -70 $16.66 -1.2%

Outlying Warren County 9.6% 130 $18.43 -5.4%

Northern Kentucky 10.8% -230 $17.69 2.2%

Eastern Cincinnati Area 11.0% -140 $17.38 0.3%

Butler County 11.40% -80 $16.49 12.70%

Northern Cincinnati Area 15.2% 90 $15.43 -8.2%

Western Cincinnati Area 17.2% 200 $14.98 -1.8%

Overall Metro 11.7% -40 $16.46 -0.8%

Submarket Trends

Lowest Vacancy Rates 1Q19

Sales Trends

OHIO METRO AREAS: CINCINNATI

• Office sales velocity inched lower during the most recent 12-month period as areduction in Class B deals dragged on the overall market. Class C closings remainedstable during the period.

• The average price per square foot was $115 during the last year, up 6 percent from theprior year. The increase in valuations supported a 20-basis-point decline in the averagecap rate to the mid-7 percent area.

* Trailing 12 months through 1Q19 over previous time periodSources: CoStar Group, Inc.; Real Capital Analytics

*1Q19 **2018



OHIO METROS

• Ongoing trade concerns weigh on growth outlook; Fed plots next steps. Amid

rising trade tensions between the U.S. and China and slowing global growth, the

outlook has turned more cautious. Market volatility, along with a flight to safety trade,

has flattened the yield curve dramatically, with the 10-Year Treasury trading below 2.2

percent. This has pushed the broader yield curve into inversion, a closely watched

precursor to a potential recession. Meanwhile, many measures of the domestic

economy remain buoyant, including continued job and wage growth, historically low

unemployment and muted inflationary pressure. These conditions have prompted a

dichotomy, with Federal Reserve officials signaling more accommodative policies. The

impending end of quantitative tightening in September, coupled with potential cuts to

the Fed funds rate in the second half of the year, highlight the shift in Fed policy. As a

result, long-term interest rates are likely to remain subdued, with Fed policy leaning

toward accommodation.

• Conservative underwriting balances abundant marketplace liquidity. While debt

availability for office assets remains widely available from a wide range of sources

including local, regional and national banks and insurance companies, sentiment

surrounding the health of the economy has fallen somewhat in recent months. Lenders

remain broadly cautious in underwriting, with loan-to-value (LTV) ratios typically in the

55 to 70 percent range, depending on the borrower, asset and location. The

conservative approach has filtered into a focus on proven property results, with much

less willingness to lend against pro forma rents. This has prompted investors to turn

toward short-term mezzanine debt and bridge loans to cover capital improvements,

while seeking long-term solutions once returns have been solidified. Construction

origination remains muted, with lenders focusing on core locations with proven

demand.

* Trailing 12 months through 1Q19 Include sales $2.5 million and greaterSources: CoStar Group, Inc.; Real Capital Analytics

Capital Markets



Source: © 2018 Experian

POPULATION 1 Miles 3 Miles 5 Miles 2023 Projection

Total Population 20,982 138,401 302,165 2018 Estimate

Total Population 21,202 142,334 309,531 2010 Census

Total Population 20,036 139,179 304,544 2000 Census

Total Population 20,904 154,572 336,637 Current Daytime Population

2018 Estimate 98,045 302,645 453,283HOUSEHOLDS 1 Miles 3 Miles 5 Miles 2023 Projection

Total Households 10,087 61,338 131,003 2018 Estimate

Total Households 10,055 62,273 132,596Average (Mean) Household Size 1.74 2.09 2.20

2010 CensusTotal Households 9,533 61,284 131,065

2000 CensusTotal Households 10,046 68,286 144,579

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles 2018 Estimate

$200,000 or More 5.54% 3.30% 4.00%$150,000 - $199,999 4.16% 2.81% 3.72%$100,000 - $149,000 8.41% 7.55% 8.89%$75,000 - $99,999 7.93% 7.82% 9.20%$50,000 - $74,999 14.59% 14.16% 15.58%$35,000 - $49,999 9.54% 12.44% 12.66%$25,000 - $34,999 7.19% 11.18% 10.97%$15,000 - $24,999 10.69% 13.53% 12.77%Under $15,000 27.71% 23.75% 19.82%

Average Household Income $67,118 $56,407 $64,264Median Household Income $35,273 $33,191 $39,275Per Capita Income $33,944 $25,783 $28,205

POPULATION PROFILE 1 Miles 3 Miles 5 Miles Population By Age

2018 Estimate Total Population 21,202 142,334 309,531Under 20 18.95% 23.96% 25.65%20 to 34 Years 34.23% 31.79% 27.92%35 to 39 Years 7.41% 6.51% 6.52%40 to 49 Years 12.87% 10.70% 10.95%50 to 64 Years 18.40% 17.08% 17.74%Age 65+ 8.12% 9.98% 11.22%Median Age 33.42 31.51 32.71

Population 25+ by Education Level2018 Estimate Population Age 25+ 15,442 91,252 201,411Elementary (0-8) 1.21% 3.34% 2.94%Some High School (9-11) 12.18% 11.70% 10.60%High School Graduate (12) 24.07% 28.42% 27.59%Some College (13-15) 15.46% 18.31% 19.34%Associate Degree Only 5.34% 5.84% 6.47%Bachelors Degree Only 23.08% 18.23% 19.21%Graduate Degree 17.72% 12.81% 12.62%

POPULATION BY TRANSPORTATION TO WORK 1 Miles 3 Miles 5 Miles

2018 Estimate Total PopulationBicycle 0.46% 0.47% 0.33%Bus or Trolley Bus 16.23% 9.24% 7.31%Carpooled 5.18% 9.20% 9.41%Drove Alone 50.68% 65.46% 71.76%Walked 21.75% 10.78% 6.34%Worked at Home 4.17% 3.91% 4.01%

POPULATION BY TRAVEL TIME TO WORK 1 Miles 3 Miles 5 Miles

2018 Estimate Total PopulationUnder 15 Minutes 36.02% 33.42% 30.32%15 - 29 Minutes 39.82% 41.92% 42.87%30 - 59 Minutes 15.38% 15.60% 17.55%60 - 89 Minutes 3.91% 2.38% 2.50%90 or More Minutes 0.36% 1.40% 1.45%Worked at Home 4.17% 3.91% 4.01%Average Travel Time in Minutes 21 22 23



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E X C L U S I V E L Y L I S T E D B Y :

Michael GlassBroker of Record

THE PATEL GROUP

Sal RamundoPartner | The Patel Group

National Office & Industrial GroupCincinnati Office

Tel: (513) 878-7736Fax: (513) 878-7710

[email protected]: KY 239856

DOWNTOWN OFFICE125 EAST COURT STREET

Darpan PatelFirst Vice President, Investments

Net Leased Properties GroupCincinnati Office

Tel: (513) 878-7723Fax: (513) 878-7710

[email protected]: OH SAL 2012000748

Documents

About theInvestment...Walker’s Paradise (Walk Score® of 99) and Excellent Transit (Transit Score® of 82) Within walking distance to 7 Fortune 500 corporate HQ’s, riverfront parks