Taco Cabana - Humble, TX

HUMBLE, TX

PRICING & FINANCIAL ANALYSIS

TACO CABANA

Annualized Operating Data

20745 Highway 59 Humble, TX 77338

Year(s)

Increase

2/26/2004

$137,313

-

11

3/1/2014

$138,686

1.00%

12

3/1/2015

$140,073

1.00%

13

3/1/2016

$141,474

1.00%

$2,198,000

14

3/1/2017

$142,888

1.00%

6.50%

15

3/1/2018

$144,317

1.00%

$142,888

16

3/1/2019

$145,761

1.00%

2003

17

3/1/2020

$147,218

1.00%

3,583 SF

18

3/1/2021

$148,690

1.00%

1.40 Acres

19

3/1/2022

$150,177

1.00%

20

3/1/2023

$151,679

1.00%

Option: 21

3/1/2022

$153,197

1.00%

Option: 22

3/1/2023

$154,729

1.00%

Option: 23-25

3/1/2022

$156,276

1.00%

Option: 26

3/1/2023

$157,839

1.00%

Option: 27

3/1/2022

$159,417

1.00%

Option: 28-30

3/1/2023

$161,011

1.00%

Option: 31

3/1/2022

$162,621

1.00%

Option: 32

3/1/2023

$164,247

1.00%

Option: 33-35

3/1/2022

$165,889

1.00%

Option: 36

3/1/2023

$167,548

1.00%

Option: 37

3/1/2022

$169,223

1.00%

Option: 38-40

3/1/2023

$170,915

1.00%

1-10

Offering Summary Price Cap Rate Net Operating Income Year Built Gross Leasable Area Lot Size

Lease Summary Lease Term

20 Years

Lease Commencement

2/26/2004

Lease Expiration

2/25/2024

Remaining Term

7 Years

Lease Type Roof & Structure Increases Options Options to Purchase

NNN Tenant 1% Annually Yes ROFR

Net Operating Income

MARKET OVERVIEW

Annual

PROPERTY DESCRIPTION

Commencement

FINANCIAL ANALYSIS

Taco Cabana

$142,888

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. © 2015 Vitorino Group

2

TENANT INFORMATION

TACO CABANA

FINANCIAL ANALYSIS

Tenant or Company Summary Company Ownership Ticker Symbol Exchange Market Cap Sales Volume Number of Locations Years In Business Headquarters Website

Taco Cabana

PROPERTY DESCRIPTION

Taco Cabana is an American fast casual restaurant chain specializing in Mexican cuisine. A wholly owned subsidiary of Fiesta Restaurant Group, Inc, it is headquartered in San Antonio, Texas. As of September 2016 Taco Cabana had 166 locations throughout Texas, Oklahoma and New Mexico. Most Taco Cabana restaurants have a drive-thru and many are open 24 hours a day. For most of the chain’s history all locations were painted in the company’s signature pink. Taco Cabana is known for its interior, semi-enclosed and patio dining areas. Most menu items are handmade daily on site in open display cooking areas including fajitas on an open-flame grill and tortillas made in-house.

Public - Fiesta Restaurant Group, Inc. FRGI NASDAQ $706 Million $719 Million 166+ 38 Years San Antonio, TX www.tacocabana.com

MARKET OVERVIEW

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. © 2015 Vitorino Group

3

INVESTMENT HIGHLIGHTS

TACO CABANA

FINANCIAL ANALYSIS

• Single-Tenant Taco Cabana Located in Northeast Houston • Corporate NNN Responsibility

Lease

-

Zero

Landlord

• 1% Rent Escalations Every Year • Outparcel to Super Target Retail Center that Includes Kohls, Famous Footwear, Mattress One, Verizon and Others

PROPERTY DESCRIPTION

• Next to Houston Metro Townsen Park and Ride Center, a Brand New Costco and Future Retail Development Site • Located in One of the Densest Retail Corridors of North Houston - Located Along the Eastex Freeway (Highway 59 North) • Adjacent to Deerbrook Mall and Surrounded by National Retailers like Costco, PetSmart, Bed Bath & Beyond, Old Navy, Sports Authority, Best Buy, Home Depot, McDonald’s, Walmart, Sam’s Club, Kroger Grocery Store, Academy Sports + Outdoors and Many Others

MARKET OVERVIEW

• High Growth Area - Population Within a 5-Mile Radius is Over 120,000 people a 71% Increase Since 2000 • Strong Demographics the Average Household Income is Above the National Average • Traffic Counts Along the Eastex Freeway (Highway 69/59N) Exceed 136,000 Vehicles Per Day

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. © 2015 Vitorino Group

4

AERIAL MAP

TACO CABANA

FINANCIAL ANALYSIS

Future Developement Metro Townsen Park & Ride BLV

D

EA

Humble Elementary School

STE X

FW

SEN

PROPERTY DESCRIPTION

Y6 9/5 9N

TOW N

MARKET OVERVIEW

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Š 2015 Vitorino Group

6

LOCAL MAP

TACO CABANA

FINANCIAL ANALYSIS PROPERTY DESCRIPTION MARKET OVERVIEW

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Š 2015 Vitorino Group

7

REGIONAL MAP

TACO CABANA

FINANCIAL ANALYSIS PROPERTY DESCRIPTION MARKET OVERVIEW

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Š 2015 Vitorino Group

8

MARKET SUMMARY

TACO CABANA

FINANCIAL ANALYSIS PROPERTY DESCRIPTION

HOUSTON, TX Houston is the most populous city in Texas, and the fifth most populous city in the United States. With a censusestimated 2013 population of 6.49 million people within a land area of 10,062 square miles, Houston is the largest city in the Southern United States, the seat of Harris County, and fifth-most populated metropolitan area in the United States.

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. © 2015 Vitorino Group

MARKET OVERVIEW

Houston was founded in 1836 on land near the banks of Buffalo Bayou (now known as Allen’s Landing) and incorporated as a city on June 5, 1837. The city was named after former General Sam Houston, who was president of the Republic of Texas and had commanded and won at the Battle of San Jacinto 25 miles (40 km) east of where the city was established. The burgeoning port and railroad industry, combined with oil discovery in 1901, has induced continual surges in the city’s population.

In the mid-twentieth century, Houston became the home of the Texas Medical Center— the world’s largest concentration of healthcare and research institutions— and NASA’s Johnson Space Center, where the Mission Control Center is located.

Houston’s economy has a broad industrial base in energy, manufacturing, aeronautics, and transportation. It is also leading in health care sectors and building oilfield equipment; only New York City is home to more Fortune 500 headquarters. The Port of Houston ranks first in the United States in international waterborne tonnage handled and second in total cargo tonnage handled. Nicknamed the Space City, Houston is a global city, with strengths in business, international trade, entertainment, culture, media, fashion, science, sports, technology, education, medicine and research. The city has a population from various ethnic and religious backgrounds and a large and growing international community. Houston is considered to be the most diverse city in Texas and the United States. It is home to many cultural institutions and exhibits, which attract more than 7 million visitors a year to the Museum District.

Houston has an active visual and performing arts scene in the Theater District and offers year-round resident companies in all major performing arts.

9

DEMOGRAPHIC SUMMARY

TACO CABANA

Geography: 5 Miles

FINANCIAL ANALYSIS

Population In the identified area, the 2016 population was 120,043. The rate of change since 2000 was 71.54%. The five-year projection for the population in the area was 134,129 representing a change of 11.73% from 2016 to 2021. The population was 49.6% male and 50.4% female. The median age in this area was 33.7, compared to U.S. median age of 38.0.

Households There were 40,595 households in your selected geography in 2016. The number of households changed by 71.67% since 2000. It is estimated that the number of households in your area will be 45,229 in 2021, which represents a change of 11.42% from 2016. The average household size in your area was 2.88 persons.

PROPERTY DESCRIPTION

Income In 2016, the median household income for your selected geography was $66,294, compared to the Entire US average which was $54,149. It is estimated that the median household income in your area will be $76,163 in 2021, which represents a change of 14.89% in five years.

The per capita income in your area is $29,317, compared to the Entire US average, which was $29,472. The average household income in your area was $83,400, compared to the Entire US average which was $77,008.

Race and Ethnicity The 2016 racial makeup of your selected area was as follows: 59.0% White, 22.4% Black, 0.5% Native American and 3.7% Asian/Pacific Islander.

Compare these to Entire US averages which were: 71.60% White, 12.70% Black, 0.18% Native American and 5.02% Asian/Pacific Islander.

People of Hispanic origin are counted independently of race. People of Hispanic origin made up 32.1% of the 2016 population in your selected area. Compare this to the Entire US average of 17.9%.

Housing MARKET OVERVIEW

In 2016, there were 26,069 owner occupied housing units in your area and there were 14,526 renter occupied housing units in your area. Median home value in the area was $139,169, compared to a median home value of $198,891 for the U.S.

Employment In 2016, there were 55,175 employees in your selected area; this is also known as the daytime population. 59.4% of employees were employed in white-collar occupations in this geography, and 22.9%were employed in blue-collar occupations. In 2016, unemployment in this area was 6.6%.

Demographic data Š 2016 esri This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Š 2015 Vitorino Group

10

DEMOGRAPHIC STATISTICS

TACO CABANA

1-Mile

3-Miles

5-Miles

Income

2000 Population

1,504

23,193

69,978

2010 Population

1,593

33,874

2016 Population

1,647

2021 Population

1,728

Households

1-Mile

3-Miles

5-Miles

$ 0 - $14,999

6.7%

9.6%

7.0%

104,577

$ 15,000 - $24,999

4.6%

8.5%

7.3%

38,417

120,043

$ 25,000 - $34,999

7.3%

10.6%

7.7%

42,639

134,129

$ 35,000 - $49,999

10.1%

14.1%

12.8%

$ 50,000 - $74,999

19.7%

22.0%

20.7%

$ 75,000 - $99,999

20.4%

13.9%

16.8%

$100,000 - $149,999

19.2%

13.9%

16.9%

3-Miles

5-Miles

$150,000 - $199,999

8.4%

4.6%

6.0%

2000 Households

544

8,621

23,647

$200,000+

3.5%

2.8%

4.8%

2010 Households

577

12,414

35,763

2016 Median Household Income

$76,364

$56,004

$66,294

2016 Households

593

13,976

40,595

2016 Per Capita Income

$30,740

$25,732

$29,317

2021 Households

619

15,424

45,229

2016 Average Household Income

$86,815

$70,864

$83,400

2016 Daytime Population

543

17,567

55,175

2016 Average Household Size

2.78

2.73

2.88

2010 Owner Occupied Housing Units

78.6%

51.3%

62.2%

2010 Renter Occupied Housing Units

14.1%

39.5%

30.5%

2010 Vacant

7.2%

9.2%

7.3%

2016 Owner Occupied Housing Units

77.5%

50.0%

60.8%

2016 Renter Occupied Housing Units

17.3%

43.6%

33.9%

2016 Vacant

5.3%

6.3%

5.3%

2021 Owner Occupied Housing Units

77.9%

50.5%

61.2%

2021 Renter Occupied Housing Units

17.8%

44.3%

34.2%

2021 Vacant

4.3%

5.2%

4.6%

PROPERTY DESCRIPTION

1-Mile

FINANCIAL ANALYSIS

Population

Traffic Counts

136,517 11,360

MARKET OVERVIEW

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Š 2015 Vitorino Group

11

CONFIDENTIALITY AGREEMENT The information contained in the following offering memorandum is proprietary and strictly confidential.

It is intended to be reviewed only by the party receiving it from Vitorino Group and it should not be made available to any other person or entity without the written consent of Vitorino Group. By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property at this time, please return this offering memorandum to Vitorino Group.

This offering memorandum has been prepared to provide summary, unverified financial and physical information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation.

Vitorino Group has not made any investigation, and makes no warranty or representation with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCBs or asbestos, the compliance with local, state and federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this offering memorandum has been obtained from sources we believe to be reliable; however, Vitorino Group has not verified, and will not verify, any of the information contained herein, nor has Vitorino Group conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT THE VITORINO GROUP AGENT FOR MORE DETAILS.

Net Lease Disclaimer Vitorino Group hereby advises all prospective purchasers of Net Leased property as follows: The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, the Vitorino Group has not and will not verify any of this information, nor has the Vitorino Group conducted any investigation regarding these matters.

The Vitorino Group makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided.

As the Buyer of a net leased property, it is the Buyer’s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. The Vitorino Group expressly denies any obligation to conduct a due diligence examination of this Property for Buyer.

Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors. Buyer and Buyer’s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs.

Like all real estate investments, this investment carries significant risks. Buyer and Buyer’s legal and financial advisors must request and carefully review all legal and financial documents related to the property and tenant. While the tenant’s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant’s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer’s legal ability to make alternate use of the property.

By accepting this Marketing Brochure you agree to release The Vitorino Group and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property.

Approved by the Texas Real Estate Commission for Voluntary Use Texas law requires all real estate licensees to give the following information about brokerage services to prospective buyers, tenants, sellers and landlords.

B

Information About Brokerage Services

efore working with a real estate broker, you should know that the duties of a broker depend on whom the broker represents. If you are a prospective seller or landlord (owner) or a prospective buyer or tenant (buyer), you should know that the broker who lists the property for sale or lease is the owner’s agent. A broker who acts as a subagent represents the owner in cooperation with the listing broker. A broker who acts as a buyer’s agent represents the buyer. A broker may act as an intermediary between the parties if the parties consent in writing. A broker can assist you in locating a property, preparing a contract or lease, or obtaining financing without representing you. A broker is obligated by law to treat you honestly.

IF THE BROKER REPRESENTS THE OWNER: The broker becomes the owner’s agent by entering into an agreement with the owner, usually through a written - listing agreement, or by agreeing to act as a subagent by accepting an offer of subagency from the listing broker. A subagent may work in a different real estate office. A listing broker or subagent can assist the buyer but does not represent the buyer and must place the interests of the owner first. The buyer should not tell the owner’s agent anything the buyer would not want the owner to know because an owner’s agent must disclose to the owner any material information known to the agent.

IF THE BROKER REPRESENTS THE BUYER: The broker becomes the buyer’s agent by entering into an agreement to represent the buyer, usually through a written buyer representation agreement. A buyer’s agent can assist the owner but does not represent the owner and must place the interests of the buyer first. The owner should not tell a buyer’s agent anything the owner would not want the buyer to know because a buyer’s agent must disclose to the buyer any material information known to the agent.

IF THE BROKER ACTS AS AN INTERMEDIARY: A broker may act as an intermediary between the parties if the broker complies with The Texas Real Estate License Act. The broker must obtain the written consent of each party to the transaction to act as an

intermediary. The written consent must state who will pay the broker and, in conspicuous bold or underlined print, set forth the broker’s obligations as an intermediary. The broker is required to treat each party honestly and fairly and to comply with The Texas Real Estate License Act. A broker who acts as an intermediary in a transaction: (1) shall treat all parties honestly; (2) may not disclose that the owner will accept a price less than the asking price unless authorized in writing to do so by the owner; (3) may not disclose that the buyer will pay a price greater than the price submitted in a written offer unless authorized in writing to do so by the buyer; and (4) may not disclose any confidential information or any information that a party specifically instructs the broker in writing not to disclose unless authorized in writing to disclose the information or required to do so by The Texas Real Estate License Act or a court order or if the information materially relates to the condition of the property.

With the parties’ consent, a broker acting as an intermediary between the parties may appoint a person who is licensed under The Texas Real Estate License Act and associated with the broker to communicate with and carry out instructions of one party and another person who is licensed under that Act and associated with the broker to communicate with and carry out instructions of the other party.

If you choose to have a broker represent you, you should enter into a written agreement with the broker that clearly establishes the broker’s obligations and your obligations. The agreement should state how and by whom the broker will be paid. You have the right to choose the type of representation, if any, you wish to receive. Your payment of a fee to a broker does not necessarily establish that the broker represents you. If you have any questions regarding the duties and responsibilities of the broker, you should resolve those questions before proceeding.

Real estate licensee asks that you acknowledge receipt of this information about brokerage services for the licensee’s records.

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