Energy Industry Portfolio Transaction Overview

Date of Investment	December 2000
Transaction Size	$15 Million
Insurance Costs	$0.4 Million
Type of Assets	Portfolio
Gross Rentable Area	78,000 square feet
Raw-acreage	43-acres
Location	11 western and mid-western states

Transaction Background

An acquisition of a portfolio of 68 active and inactive gas station pad sites in December 2000. The properties are located in 11 mid-western and western states with 78,000 square feet of improvements (typically service bays with small retail areas) on 43-acres. They were acquired from Equilon Enterprises, LLC ("Equilon"), a former joint venture of Shell and Texaco.

Environmental

Equilon provided an environmental indemnity on all the sites and is actively remediating 45 of the 68 sites. The remaining sites have received NFA letters, or have no known contamination. Under the terms of the indemnity, any remediation costs incurred will be reimbursed by Equilon. Although Equilon is responsible for the remediation of the sites, to enhance the marketability of the sites to potential buyers, our client obtained property transfer liability environmental insurance for all the sites.

Transaction Highlights

• The sites are suitable for future retail and commercial development, and are largely in desirable locations.
  
  
• In contrast to typical acquisitions where an indemnity is provided to the seller, the seller in this transaction, Equilon, provided a full indemnity to our client.