A L B U Q U E R Q U E N E W M E X I C O O F F E R I N G M E M O R A N D U M

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1 OFFERING MEMORANDUM ALBUQUERQUE NEW MEXICO

2 2 INVESTMENT OVERVIEW INVESTMENT OVERVIEW Marcus & Millichap is pleased to present this Pep Boys Supercenter in Albuquerque, New Mexico. Albuquerque is New Mexico s most populous city. The lease is guaranteed by The Pep Boys Manny, Moe & Jack of Pennsylvania, Corporation (Corp), which is a wholly owned subsidiary of Icahn Enterprises, Limited Partnership (LP). Icahn Enterprises ranked number 168 on the June 2017 Fortune 500 List. The tenant is operating under a triple-net (NNN) lease featuring zero landlord responsibilities. There are oneand-half percent rent increases annually. This highly visible Pep Boys is located along San Mateo Boulevard, a major corridor in Albuquerque with daily traffic counts that exceed 40,000 vehicles per day (VPD). Additionally, Pep Boys is less than half of a mile from Interstate-25, and is the first auto parts and service center upon exit of the interstate. More than 160,000 vehicles travel along this interstate daily. Pep Boys benefits from being surrounded by several used car dealers including: C U Auto Sales and Best Deals on Wheels. The subject asset is located within a dense trade area. There is more than 800,000 square feet of retail within one-mile. National credit anchors include: Ross Dress for Less, Albertson s Market, and Cinemark Movies. Pep Boys benefits from strong demographics. There are more than 250,000 residents with an average household income (AHHIC) greater than $65,000 within five-mile radius. Additional tenants in the immediate vicinity include: Dollar Tree, SUBWAY, Taco Bell, Albertsons, Verizon, Chick- Fil-A, Walgreens, Sonic, Golden Corral, and many more.

3 3 INVESTMENT OVERVIEW Pep Boys Supercenter in Albuquerque New Mexico s Most Populous City Triple-Net (NNN) Lease with More Than Five Years Remaining in Base Term Four, Five-Year Options to Extend Hedge Against Inflation Annual Rent Bumps of 1.5 Percent Strong Demand for Aftermarket Auto Parts Average Age of Vehicle on Road is 11.6 Years Total Number of Miles Traveled on United States (US) Highways Increased 3 Percent in 2016 Tremendous Visibility Along Four-Lane Thoroughfare San Mateo Boulevard Sees More Than 40,000 Vehicles Per Day (VPD) First Auto Parts and Service Center Upon Exit of Interstate-25 More Than 160,000 Vehicles Per Day (VPD) Dense Retail Corridor More Than 800,000 Square Feet of Retail Within One-Mile Strong Credit Anchors Include: Albertsons Market, Ross Dress For Less, and Cinemark Movies Easy Access via Public Transportation, Bus Stop Right in Front of Asset ABQ Ride Route 141 More Than 35,000 Riders Per Day (RDP) Dense Auto Corridor Adjacent to Several Used Car Dealerships C U Auto Sales, Alfa Romeo of Albuquerque and Many More Significant Capital Contributions $18.6 Million of Active Construction Permits for Retail Developments New Trampoline Park and Flooring Products Store Strong Demographics More Than 250,000 Residents With an Average Household Income (AHHI) Greater Than $65,000

4 4 FINANCIAL OVERVIEW FINANCIAL OVERVIEW PRICE $3,200,000 CAP RATE 6.89% NOI $220,392 PRICE PER SQUARE FOOT $ RENT PER SQUARE FOOT $12.30 YEAR BUILT 1985 APPROXIMATE LOT SIZE 1.31 Acres GROSS LEASEABLE AREA 17,920 TYPE OF OWNERSHIP LEASE GUARANTOR LEASE TYPE Fee Simple The Pep Boys Manny, Moe & Jack of Pennsylvania Corporation (Corp) Triple-Net (NNN) ROOF AND STRUCTURE Tenant Responsible

5 5 LEASE SUMMARY LEASE SUMMARY LEASE COMMENCEMENT DATE 8/1/2008 LEASE EXPIRATION DATE 7/31/2023 LEASE TERM 15 Years TERM REMAINING 5+ Years ANNUALIZED OPERATING DATA BASE RENT ANNUAL RENT MONTHLY RENT CURRENT 7/31/2018 $220,392 $18,366 INCREASES 8/1/2018 7/31/2019 $223,698 $18, % 8/1/2019 7/31/2020 $227,053 $18, % INCREASES OPTIONS TO RENEW FIRST RIGHT OF REFUSAL 1.5% Annual Bumps 4, 5-Year Yes 8/1/2020 7/31/2021 $230,459 $19, % 8/1/2021 7/31/2022 $233,916 $19, % 8/1/2022 7/31/2023 $237,425 $19, % OPTIONS Annual Rent Monthly Rent 8/1/2023 7/31/2024 $240,986 $20, % 8/1/2024 7/31/2025 $244,601 $20, % 8/1/2025 7/31/2026 $248,270 $20, % 8/1/2026 7/31/2027 $251,994 $21, % 8/1/2027 7/31/2028 $255,774 $21, % 8/1/2028 7/31/2033 FMV FMV/12 TBD 8/1/2033 7/31/2038 FMV FMV/12 TBD

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7 7 TENANT OVERVIEW TENANT OVERVIEW - PEP BOYS Pep Boys was founded in 1921, opening its first location in Philadelphia. Originally named Pep Auto Supply Company, they opened their first store with the famous Pep Boys name in Los Angeles in Pep Boys went public in 1945 in order to meet increasing demand unleashed at the end of WWII. Pep Boys experienced their greatest expansion in 1982, with the birth of the automotive supercenter idea. Today, Pep Boys operates more than 9,000 service bays in more than 900 locations across 35 states and Puerto Rico. Pep Boy s stores are organized into a hub and spoke network consisting of Supercenters and Service and Tire Centers. Supercenters average approximately 20,000 square feet (the new Supercenter format is approximately 14,000 square feet) and combine Do-It-For-Me (DIFM) service labor, installed merchandise and tire offerings with Do-It-Yourself (DIY) parts and accessories. Most of their Supercenters also have a commercial sales program that provides prompt delivery of parts, tires and equipment to automotive repair shops and dealers. Service and Tire Centers, which average approximately 6,000 square feet, provide DIFM services in neighborhood locations that are conveniently located where our customers live or work. Service and Tire Centers are designed to capture market share and leverage Pep Boy s existing Supercenters and support infrastructure. The company competes with AutoZone, O Reilly Automotive, Wal-Mart; Target; and K-Mart. Icahn Enterprises Limited Partnership (L.P) ( Icahn Enterprises ) (NASDAQ:IEP) announced in February 2016 that it closed its acquisition of The Pep Boys Manny, Moe & Jack ( Pep Boys ) (NYSE:PBY) in an all-cash transaction for $18.50 per share, or approximately $1.03 billion in aggregate equity value. In 2017 Pep Boys Manny, Moe & Jack acquired Just Brakes Limited Liability Company (L.L.C.), an automotive repair and maintenance chain with 134 stores throughout the United States southern tier, boosting the number of Pep Boys locations to more than 900. TENANT PROFILE TENANT TRADE NAME Pep Boys OWNERSHIP Wholly Owned Subsidiary of Icahn Enterprises TENANT Pep Boys LEASE GUARANTOR The Pep Boys Manny, Moe & Jack of Pennsylvania Corporation (Corp) NUMBER OF LOCATIONS 900+ HEADQUARTERED Philadelphia, Pennsylvania WEB SITE STOCK SYMBOL IEP BOARD NASDAQ NET WORTH $1.2 Billion (2016) CREDIT RATING S&P: BB+ (NASDAQ: IEP)

8 8 DEMOGRAPHICS DEMOGRAPHICS 1-Mile 3-Mile 5-Mile POPULATION 2000 Population 11,866 89, , Population 12,565 95, , Population 15, , , Population 16, , ,347 1-Mile 3-Mile 5-Mile HOUSEHOLDS 2000 Households 5,740 39, , Households 6,087 42, , Households 7,594 45, , Households 7,919 46, ,452 1-Mile 3-Mile 5-Mile HOUSEHOLD (HH) INCOMES 2017 Average HH Income $49,704 $62,322 $66, Median HH Income $36,052 $45,700 $47, Per Capita Income $24,429 $28,209 $29,577

9 9 ALBUQUERQUE, NEW MEXICO ABOUT ALBUQUERQUE Albuquerque is the most populous city in New Mexico. The high-elevation city serves as the county seat of Bernalillo County, and it is situated in the north central part of the state, straddling the Rio Grande. The city population was 559,277 as of the July 1, 2016 population estimate from the United States Census Bureau. Sandia Mountains run along the eastern side of Albuquerque, and the Rio Grande flows through the city, north to south. Albuquerque is also the home of the International Balloon Fiesta, the world s largest such gathering of hot-air balloons from around the globe. The event takes place during the first week of October. Albuquerque is home to the University of New Mexico ($393-milllion endowment), the largest public flagship university in the state. It is New Mexico s largest post-secondary institution in the state with more than 27,300 students and one of the state s largest employers. The university includes a School of Medicine, which was ranked in the top 50 primary care-oriented medical schools in the country. Albuquerque lies at the center of the New Mexico Technology Corridor, a concentration of high-tech private companies and government institutions along the Rio Grande. Larger institutions whose employees contribute to the population are numerous and include Sandia National Laboratories, Kirtland Air Force Base, and the attendant contracting companies which bring highly educated workers. Intel operates a large semiconductor factory or fab in suburban Rio Rancho, in neighboring Sandoval County, with its attendant large capital investment. Northrop Grumman is located along Interstate-25 in northeast Albuquerque. In January 2007, Tempur-Pedic opened an 800,000-square-foot mattress factory in northwest Albuquerque.

10 MARCUS & MILLICHAP 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, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap 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. Marcus & Millichap 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 Marcus & Millichap Real Estate Investment Services 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.

11 ALBUQUERQUE NEW MEXICO 5651 SAN MATEO BOULEVARD ALBUQUERQUE, NEW MEXICO BROKER OF RECORD: MATTHEW REEVES MARCUS & MILLICHAP LICENSE: 19583