cCARE | Offering Memorandum

S U M M A R Y

HIGHLY SOUGHT-AFTER SUBMARKET WITH LIMITED MEDICAL OFFICE AVAILABILITY cCARE’s San Marcos location is located just 1.5 miles North of the new Palomar Medical Center of Escondido (“PMCE”) and provides easy access for physicians and patients between the two facilities. PMCE has 288 private single-patient rooms, 44 emergency and trauma rooms and 11 operating rooms, and is the only Trauma Center within a 20-mile radius, serving California’s largest public healthcare district at 2,200 square miles. The former 14-acre Palomar Health hospital campus in nearbydowntownEscondido isslatedfor redevelopment into a mixed-use residential and commercial center, continuing to move the medical epicenter to the west. Additionally, much of the competitive set consists of older product in inferior locations, limiting tenant’s options to few quality buildings within close proximity to PMCE. SanDiegoCounty’s inventory of 12,622,755SFofmedical office space finished 2018 with 139,606 SF of positive net absorption. This marked the 16 th straight quarter of positive net absorption, which left every submarket in the county with single-digit vacancy. The subject property falls within the North County submarket, but also competes within the I-15 Corridor, both of which feature some of the highest average asking rates in the County. Recent medical office construction in the area includes the newly completed Palomar Health Outpatient Center (PHOC) located on the campus of Palomar Medical Center Escondido. The first of two phases was delivered in the beginning of 2018 and is 100% leased by Palomar Health. Phase II will be completed late 2019 and will also be 100% leased by Palomar Health. Each building is 75,000 SF (150,000 SF in total). The master lease signed by Palomar featured a starting rate of $2.95/SF NNN with 2.75% annual increases over a 15 year term and included a $70/SF TI allowance.

PALOMAR MEDICAL CENTER ESCONDIDO

SUPERIOR ACCESS & TRANSIT FRIENDLY LOCATION

Offering superior freeway access at Nordahl Road on and off ramps, cCARE’s San Marcos facility sits within close proximity to the crossroads of the I-15 (248,000 AADT) and SR-78 (89,500 AADT) freeways, two major thoroughfares in San Diego County, making the site highly accessible to North San Diego County, the second-most-populous region in the county after the North Central Region. Immediately adjacent to SR-78, the main east-west artery through North San Diego County, and near the merge with 1-15, one of two primary north-south arteries in San Diego. Additionally, It is in close proximity to multiple restaurants, retail services, new bus stop and Sprinter station. STRONG DEMOGRAPHICS cCARE’s San Marcos facility provides investors with the opportunity to acquire an asset located in an area with robust demographic drivers. The population within a 5-mile radius of the property is estimated at 240,300 people, which suggests a population growth rate of over 9% since the 2010 Census. Furthermore, the local population is predicted to grow by 4.5% through 2023, resulting in an estimated population of nearly 251,129 people at that point in time. Average household income within a 5-mile radius is $81,167.

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OFFERING MEMORANDUM