RU Martin Santa Clara CA, LLC, an affiliate of RW Holdings NNN REIT, Inc. (the “Company”) acquired the Santa Clara Property (the “Property”), a three building portfolio located at 2210-2260 Martin Avenue Santa Clara, California, from San Tomas Income Partners, LLC, an unrelated third-party, on September 30, 2017. The Property consists of a 91,740 square foot, three office/R&D manufacturing project portfolio. Fujifilm Dimatix leases 100% of the Property under three leases. The historical statement of revenue and direct operating expenses (the “historical statement”) reflects only the operations of the Property and not those of the Company.

The accompanying historical statements of revenue and direct operating expenses has been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (the “SEC”), which requires that certain information with respect to real estate operations be included with certain SEC filings. Revenue and direct operating expenses are presented on the accrual basis of accounting. Rental income is recognized on a straight-line basis over the related lease term.

Certain revenue, costs and expenses that are dependent on the ownership, management and carrying value of the Property have been excluded from the accompanying historical statement. The excluded revenue consist primarily of nonoperating revenue related to the Property. The excluded expenses consist primarily of interest, depreciation and amortization of the Property. Property taxes represent the taxes paid or accrued based upon pre-acquisition assessed value. As a result of the acquisition of the Property, the assessed value and related real estate tax expense may change. Consequently, the excess of revenue over direct operating expenses as presented is not intended to be either a complete presentation of the Property’s historical revenue and expenses or comparable to the proposed future operations of the Property.

Management has made a number of estimates and assumptions relating to the reporting and disclosure of revenue and direct operating expenses during the reporting period to prepare the historical statement of revenues and direct operating expenses in conformity with accounting principles generally accepted in the United States of America. Actual results could differ from those estimates.

Interim Financial Information

The accompanying unaudited historical statement of revenue and direct operating expenses have been prepared in accordance GAAP for interim financial information as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“Codification”), and in conjunction with rules and regulations of the SEC, including Article 10 of Regulation S-X. Accordingly, the unaudited historical statement of revenue and direct operating expenses do not include certain information and footnote disclosures required by GAAP for audited financial statements. In the opinion of management, the unaudited historical statement of revenue and direct operating expenses reflect all adjustments which are of a normal and recurring nature, necessary for a fair and consistent presentation of the financial position and the results for the interim period presented. Operating results for the six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the entire year or any subsequent interim period.

An affiliate of the former owner of the Property managed the Property. Monthly fees paid for property management services were 2% of rental income. The Property incurred expenses of $42,000 and $19,905 (unaudited) related to property management fees for the year ended December 31, 2016 and for the six months ended June 30, 2017, respectively.

SANTA CLARA PROPERTY

NOTES TO HISTORICAL STATEMENTS OF REVENUE AND

DIRECT OPERATING EXPENSES

For the Year Ended December 31, 2016 and the Six Months Ended June 30, 2017 (unaudited)

(continued)

The real estate industry is cyclical, being dependent in part on the status of local, regional, and national economies. As such, future revenues and expenses achieved by the Property’s management could materially differ from historical results. If tenants were to default on their leases, future revenues of the Property would be severely impacted.

The leases are accounted for as operating leases. Minimum annual rentals are recognized on a straight-line basis over the term of the related lease.

The Property is 100% leased to Fujifilm Dimatix, a wholly owned subsidiary of Fujifilm Holdings Corporation.

At December 31, 2016, the Property is leased to Fujifilm under three noncancelable operating leases that expire on March 16, 2026. These leases also provide for additional rents based on certain operating expenses of the Property. Approximate future minimum rents to be received from non-cancelable operating leases, excluding tenant reimbursements, for each of the next five years ending December 31 and thereafter, are summarized as follows:

The Property is subject to legal claims in the ordinary course of business. Management believes that the ultimate settlement of any potential claims will not have a material impact on the Property’s results of operations.

In connection with the ownership and operation of the real estate property, the Property may be potentially liable for costs and damages related to environmental matters. The Property has not been notified by any governmental authority of any non-compliance, liability or other claim, and the Company is not aware of any other environmental condition that management believes will have a material adverse effect on the Property’s results of operations.

The Property evaluated subsequent events through December 14, 2017, the date the historical statements were available to be issued.

RW Holdings NNN REIT, Inc

UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 2017 AND THE YEAR ENDED DECEMBER 31, 2016

The following Unaudited Pro Forma Consolidated Statements of Operations for the six months ended June 30, 2017 and the year ended December 31, 2016 are presented as if the Company’s investment in the Santa Clara Property as referenced in the Notes to the audited historical financial information above had occurred as of the beginning of the earliest period presented. These unaudited pro forma consolidated financial statements should be read in conjunction with the Company’s historical consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 and Quarterly Report on Form 10-Q for the quarter ended June 30, 2017. The Pro Forma Consolidated Statements of Operations are unaudited and are not necessarily indicative of what the actual results of operations would have been had the Company’s investment in the Santa Clara Property occurred as of the beginning of the period presented, nor does it purport to present the future results of operations in the Company.

See accompanying footnotes to Unaudited Pro Forma Consolidated Statements of Operations.

RW Holdings NNN REIT, Inc

FOOTNOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 2017

Pro Forma adjustments have been made to the historical results of operations of the Santa Clara Property for the following items.

See accompanying footnotes to Unaudited Pro Forma Consolidated Statements of Operations.

RW Holdings NNN REIT, Inc

FOOTNOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 2016

Pro Forma adjustments have been made to the historical results of operations of the Santa Clara Property for the following items.