NAI Global Market Report - 2011

GLOBAL
MARKET REPORT 2011

Values, trends & opportunities
in 200+ property markets worldwide.
Investment
Office
Industrial
Retail
Land
® tel +1 609 945 4000
fax +1 609 945 4001
www.naiglobal.com
4 Independence Way
Suite 400
Princeton NJ 08540
Jeffrey M. Finn
President &
Chief Executive Officer
January 2011
Dear Real Estate Executive:
Although 2010 was another very challenging year for commercial real estate, we began to see clear signs that the global
economy and commercial real estate markets had stabilized and were beginning to improve. The sentiment at year-end 2010
is much better than it was a year ago. While the level of optimism varies from market to market, as economies in some parts
of the world still face significant challenges, the general belief is that the worst is behind us.
Corporations once again are moving forward on plans, releasing pent-up demand and in most cases taking advantage of a
tenants’ market worldwide to reduce their overall occupancy costs. While the massive wave of foreclosures we originally
expected never materialized as banks, absent pressure to foreclose, opted to extend or re-work troubled loans, we expect a
much more active market for buyers and sellers as conditions start to improve. With interest rates at an all-time low, we
expect institutional investors and private equity players to return to commercial real estate in 2011-2012 in pursuit of returns.
There is already a tremendous amount of capital amassed on the sidelines and a reported shortage of quality assets offered
for sale. We expect more assets to transact as pricing improves.
NAI Global is pleased to present its 2011 Global Market Report. Now in its 25th year, the Global Market Report provides
comprehensive market data and overviews on more than 200 property markets around the world. This year’s edition is our
most comprehensive report ever, with coverage of all primary markets and most secondary and tertiary markets worldwide.
Using both narrative market reports and statistical charts, we provide you with market highlights, trends, demographic and
business profiles, rental rates, vacancy rates and land prices. The 2011 Global Market Report puts a wealth of market intelli-
gence at your fingertips in a succinct and consistent market profile format.
Dr. Peter Linneman, NAI Global’s Chief Economist and Principal of Linneman Associates, the leading real estate economics
consulting firm, worked with us again this year to prepare the Global Outlook. Linneman Associates has added its expert
economic analysis and insights to the detailed local market information from NAI professionals worldwide to deliver the infor-
mation you need on commercial real estate costs and market conditions around the world. We are proud of our relationship
with Dr. Linneman and are pleased to be able to share his insights with you.
All of the market information in the 2011 Global Market Report is available online at www.naiglobal.com and major markets are
updated periodically throughout the year. For the latest in commercial real estate industry news and trends, Global Economic
Outlook briefings, market updates and much more, visit www.naiglobal.com.
Just as NAI Global provides you with in-depth knowledge and insight on markets around the world, our global managed
network can help you achieve your real estate objectives no matter how large or small, anywhere in the world. Our clients
come to us for our deep local knowledge, which leads to results that are tangible, measurable and visible on their bottom line.
We welcome the opportunity to serve you. If we can assist you with a current or future real estate requirement anywhere in the
world, please contact us at + 1 609 945 4000 or call your local NAI professional.
Sincerely,
Jeffrey M. Finn
President & Chief Executive Officer
Build on the power of our network.TM Over 350 offices worldwide. www.naiglobal.com
1
n n n Table of Contents
GENERAL INFORMATION Mexico Nebraska
NAI Global President's Letter ..........................................................1 Ciudad Juarez, Chihuahua.........................................................70 Lincoln .................................................................................108
Table of Contents ...........................................................................2 Guadalajara, Jalisco..................................................................71 Omaha .................................................................................108
Note from Dr. Peter Linneman.........................................................3 Guanajuato,..............................................................................71 Nevada
About The Global Market Report......................................................3 Matamoros, Tamaulipas ............................................................72 Las Vegas .............................................................................109
GLOBAL OUTLOOK Mexicali, Baja California ............................................................72 Reno ....................................................................................109
U.S. Year in Review ........................................................................4 Mexico City, Mexico ..................................................................73 New Hampshire
Monterrey, Nuevo Leon .............................................................73 Manchester...........................................................................110
REGIONAL HIGHLIGHTS Querétaro, Querétaro ................................................................74 Portsmouth ...........................................................................110
Northeast Highlights .....................................................................24 Reynosa, Tampaulipas...............................................................74 New Jersey
Southeast Highlights ....................................................................25 Saltillo, Coahuila .......................................................................75 Atlantic County......................................................................111
Midwest Highlights.......................................................................26 San Luis Potosi (SLP) ................................................................75 Middlesex/Somerset Counties ................................................111
Southwest Highlights....................................................................27 Tijuana, Baja California..............................................................76 Northern New Jersey .............................................................112
West Highlights............................................................................28 Torreon, Coahulia......................................................................76 Ocean/Monmouth Counties (“Shore Market”) ..........................112
ASIA PACIFIC Panama City, Republic of Panama .................................................77 Princeton/Mercer County .......................................................113
Adelaide, Australia .......................................................................30 Caracas, Venezuela ......................................................................77 Southern New Jersey.............................................................113
Brisbane, Australia .......................................................................30 New Mexico
UNITED STATES
Melbourne, Australia ....................................................................31 Alabama
Albuquerque .........................................................................114
Perth, Australia ............................................................................31 Birmingham ..............................................................................79 Las Cruces ...........................................................................114
Sydney, Australia..........................................................................32 New York
Huntsville/Decatur County ..........................................................79
China Mobile/Baldwin County ..............................................................80 Albany ..................................................................................115
Beijing .....................................................................................32 Arizona
Long Island ...........................................................................115
Hong Kong ...............................................................................33 Phoenix ....................................................................................80 New York City........................................................................116
Shanghai..................................................................................33 Arkansas
Westchester..........................................................................116
Guam..........................................................................................34 North Carolina
Jonesboro.................................................................................81
India Little Rock.................................................................................81 Asheville ...............................................................................117
Chennai ...................................................................................34 California
Charlotte...............................................................................117
Delhi, Gurgaon .........................................................................35 Bakersfield..............................................................................82 Greensboro/High Point/Winston-Salem ...................................118
Kolkata.....................................................................................35 Inland Empire (Riverside/San Bernardino)..................................82 Raleigh/Durham ....................................................................118
Pune, Maharashtra ...................................................................36 North Dakota
Los Angeles County .................................................................83
Punjab .....................................................................................36 Orange County ........................................................................83 Fargo....................................................................................119
Tokyo, Japan ...............................................................................37 Ohio
San Diego...............................................................................84
Kuala Lumpur Malaysia ................................................................37 San Francisco .........................................................................84 Akron ...................................................................................119
Auckland, New Zealand ................................................................38 Ventura County .......................................................................85 Canton .................................................................................120
Christchurch, New Zealand...........................................................38 Colorado
Cincinnati .............................................................................120
Wellington, New Zealand ..............................................................39 Colorado Springs.....................................................................85 Cleveland..............................................................................121
Singapore....................................................................................39 Denver....................................................................................86 Columbus .............................................................................121
Seoul, South Korea.......................................................................40 Delaware
Dayton..................................................................................122
Taipei, Taiwan ..............................................................................40 Oklahoma
Delaware & Cecil County Maryland...........................................86
District of Columbia
Oklahoma City.......................................................................122
CANADA Tulsa ....................................................................................123
Alberta Washington, DC ......................................................................87
Oregon
Calgary ....................................................................................42 Florida
Fort Lauderdale.......................................................................87 Portland................................................................................123
Edmonton ................................................................................42 Pennsylvania
British Columbia Ft. Myers/Naples/Port Charlotte/Bonita Springs .........................88
Jacksonville ............................................................................88 Allentown..............................................................................124
Vancouver................................................................................43 Berks County ........................................................................124
Victoria ....................................................................................43 Martin/ St. Lucie Counties........................................................89
Miami.....................................................................................89 Bucks County........................................................................125
Nova Scotia Harrisburg/York/Lebanon .......................................................125
Halifax .....................................................................................44 Orlando ..................................................................................90
Palm Beach County .................................................................90 Lancaster .............................................................................126
Ontario Philadelphia ..........................................................................126
Ottawa.....................................................................................44 Tampa Bay..............................................................................91
Georgia
Pittsburgh .............................................................................127
Toronto ....................................................................................45 Schuylkill County ...................................................................127
Montreal ..................................................................................45 Atlanta....................................................................................91
Savannah ...............................................................................92 Wilkes-Barre/Scranton/Hazleton .............................................128
Regina, Saskatchewan...............................................................46 South Carolina
Hawaii
EUROPE, MIDDLE EAST, AFRICA Honolulu .................................................................................92 Charleston ............................................................................122
Vienna, Austria.............................................................................48 Idaho
Columbia ..............................................................................129
The Baltics (Latvia/Estonia/Lithuania) ............................................48 Boise......................................................................................93 Greenville/Spatanburg/Anderson Counties ..............................129
Brussels, Belgium ........................................................................49 South Dakota
Southeast (Idaho Falls/Pocatello) ..............................................93
Sofia, Bulgaria .............................................................................49 Illinois
Sioux Falls ............................................................................130
Prague, Czech Republic................................................................50 Tennessee
Chicago .................................................................................94
Copenhagen, Denmark.................................................................50 Springfield ..............................................................................94 Chattanooga .........................................................................130
Helsinki, Finland...........................................................................51 Indiana
Clarksville .............................................................................131
Paris, France ...............................................................................51 Fort Wayne .............................................................................95 Knoxville ...............................................................................131
Frankfurt am Main, Germany ........................................................52 Indianapolis ............................................................................95 Memphis ..............................................................................132
Atehens, Greece ..........................................................................52 Texas
Iowa
Reykjavik, Iceland.........................................................................53 Cedar Rapids, Iowa City ...........................................................96 Austin...................................................................................132
Tel Aviv, Isreal ..............................................................................53 Davenport/Bettendorf, Iowa & Rock Island/Moline, Illinois...........96 Beaumont .............................................................................133
Almaty, Kazakhstan ......................................................................54 Des Moines.............................................................................97 Corpus Christi .......................................................................133
Kuwait.........................................................................................54 Sioux City ...............................................................................97 Dallas ...................................................................................134
Luxembourg City, Luxembourg ......................................................55 Kansas
El Paso .................................................................................134
Amsterdam, The Netherlands........................................................55 Wichita ...................................................................................98 Fort Worth.............................................................................135
Oslo, Norway ...............................................................................56 Kentucky
Houston................................................................................135
Warsaw, Poland ...........................................................................56 Lexington................................................................................98 Rio Grande Valley (McAllen/Mission/Brownsville/Harlingen) ......136
Doha, Qatar .................................................................................57 Louisville ................................................................................99 San Antonio ..........................................................................136
Bucharest, Romania .....................................................................57 Louisiana
Texarkana (Bowie County, Texas/Miller County, Arkansas) .........137
Moscow, Russia ...........................................................................58 Utah
Baton Rouge ...........................................................................99
St. Petersburg, Russia ..................................................................58 Monroe.................................................................................100 Salt Lake City........................................................................137
Belgrade, Serbia ..........................................................................59 New Orleans .........................................................................100 Washington County ...............................................................138
Johannesburg South, Africa ..........................................................59 Vermont
Maine
Madrid, Spain ..............................................................................60 Greater Portland/Southern Maine ...........................................101 Burlington .............................................................................138
Stockholm, Sweden......................................................................60 Virginia
Maryland
Geneva, Switzerland .....................................................................61 Baltimore ..............................................................................101 Northern Virginia ...................................................................139
Zurich, Switzerland.......................................................................61 Washington
Suburban Maryland ...............................................................102
Istanbul, Turkey............................................................................62 Massachusetts
Seattle/Puget Sound..............................................................139
Kiev (Kyiv), Ukraine.......................................................................62 Boston..................................................................................102 Spokane ...............................................................................140
London, England United Kingdom..................................................63 Greater Springfield(Western) .................................................103 Tri-Cities ...............................................................................140
Wisconsin
LATIN AMERICA AND THE CARIBBEAN Michigan
Detroit ..................................................................................103 Northeastern Wisconsin (Fox Valley/Green Bay) .......................141
Buenos Aires, Argentina................................................................65 Madison ...............................................................................141
Nassau, Bahamas ........................................................................65 Grand Rapids ........................................................................104
Lansing ................................................................................104 Milwaukee ............................................................................142
Brazil Wyoming
Campinas.................................................................................66 Minnesota
Minneapolis/St. Paul..............................................................105 Casper..................................................................................142
Curitiba ....................................................................................66 Jackson Hole ........................................................................143
Porto Alegre .............................................................................67 Missouri
Rio de Janeiro ..........................................................................67 Kansas City...........................................................................105 Glossary ....................................................................................144
Sao Paulo.................................................................................68 St. Louis ...............................................................................106
Santiago, Chile.............................................................................68 Montana
Bogotá, Colombia.........................................................................69 Billings .................................................................................106
San Jose, Costa Rica....................................................................69 Bozeman ..............................................................................107
Kingston, Jamaica........................................................................70 Missoula...............................................................................107 2011 Global Market Report n www.naiglobal.com 2
nA Note From n About The
n n
Dr. Peter Linneman Global Market Report
The 2011 Global Market Report is a unique tool that reviews
and summarizes the real estate activities of the past year on
more than 200 property markets worldwide. As a reference
Once again, Linneman Associates is pleased to join tool, it reviews values, economies, social factors and other
NAI Global in the production of the 2011 Global Market conditions that impact a market.
Report. For years, NAI Global has created this annual re-
port, the industry’s source for in-depth market-by-market Each analysis was completed by the NAI Global Member
data, at a level of detail unavailable from other resources. representing the given market. These local professionals are
Since our two organizations forged a strategic alliance expert at reviewing their markets, identifying trends and re-
in 2003, we have provided NAI professionals and clients porting market activity. The NAI Global Member making the
with comprehensive market analyses, customized reports analysis for each market is identified and may be contacted
and our perspective on macroeconomic indicators as they for additional information. Most of the data in the Global Mar-
pertain to real estate markets. ket Report was collected during the fourth quarter of 2010.
By combining NAI Global’s local market data with our real Rental rates for Class A and Class B office space, retail and
estate economics expertise and proprietary projections, new construction are expressed in gross costs per unit area,
we jointly provide the reader with unmatched insight into indicating the landlord pays all expenses, except for Europe,
the state of local, regional, national and international real where rental rates are reported as net. Industrial space rents
estate markets. Linneman Associates and NAI Global con- are quoted in terms of net rental rates, meaning the tenant
tinue to jointly offer customized real estate market analyses pays for most of the operating costs, such as utilities, mainte-
and reports. Enrich your business and investment efforts by nance, repairs and cleaning. On all charts, N/A means the in-
utilizing this combination of real estate expertise, including formation was not applicable or not available at press time.
the Linneman Associates and NAI market analyses and real
estate decision making tools. For more information, call For more information about this report, or to order your own
your local NAI office. copy for $695, please call 609 945 4000. Additional research
reports and whitepapers are available at www.naiglobal.com.
Dr. Linneman holds both Masters and Doctorate degrees
in economics from the University of Chicago and is the Visit the NAI Global blog for real time commentary on industry
Principal of Linneman Associates. For over 25 years he news and trends at blogs.naiglobal.com
has provided strategic and financial advice to leading
corporations. Dr. Linneman is the author of the leading real
estate finance textbook, Real Estate Finance and Invest-
ments: Risks and Opportunities. His teaching and research
focuses on real estate and investment strategies, mergers
and acquisitions and international markets. He has pub-
lished over 60 articles during his career. He is widely rec-
ognized as one of the leading strategic thinkers in the real
estate industry.
Dr. Linneman also serves as the Albert Sussman Professor The 2011 Global Market Report is a copyrighted publication
of Real Estate, Finance, Business and Public Policy at the of NAI Global, published in December 2010, and should not
Wharton School of Business, University of Pennsylvania. A be reproduced without full permission. Additional copies are
member of Wharton’s faculty since 1979, he served as the available from NAI Global.
founding chairman of Wharton’s Real Estate Department
and the Director of Wharton’s Zell-Lurie Real Estate Center
for 13 years. He is the founding co-editor of The Wharton
Real Estate Review.
Dr. Peter Linneman, Chief Economist

NAI Global
© 2010 NAI Global. All rights reserved.
3
2011 Global Market Report n www.naiglobal.com
Global Outlook
U.S. Year in Review National Average Rental Rates
After two years of heavy declines, commercial real estate markets 2005 2006 2007 2008 2009 2010
across the United States continued to struggle through the first half O ffice
Downtown-Class A $34.37 $36.02 $41.93 $47.31 $37.11 $32.51
of 2010 as rising unemployment and uncertainty about the strength Suburban-Class A $24.42 $24.49 $25.87 $26.32 $25.48 $25.45
of the economic recovery weighed on demand. But by year’s end

Industrial
there were signs that conditions had stabilized and were beginning Bulk Warehouse $4.22 $4.66 $4.66 $4.63 $4.60 $4.55
to improve. Vacancy rates finally appear to have leveled off in many Manufacturing $5.00 $5.14 $5.57 $5.30 $4.89 $4.42
Hi-Tech/R&D
markets, aided by increased transaction activity and a virtually $8.90 $9.87 $10.03 $11.11 $8.56 $8.43
non-existent pipeline of new supply. Rental rates also have stabilized R etail
in most major markets, although quoted rents today are as much as Downtown Retail $47.67 $47.70 $48.09 $51.28 $39.90 $39.79
Service Centers $20.47 $20.56 $20.53 $18.55 $17.50 $16.48
30% off the mid-2007 peak in some places. Power Centers $22.55 $22.33 $22.54 $20.77 $19.15 $18.53
Regional Malls $43.01 $44.97 $46.26 $36.66 $32.27 $30.15
Class A office space in the central business districts, especially hard
hit during the recession, saw leasing activity increase in 2010 as Source: NAI Global
space users took advantage of a tenants’ market to lock in low rates

or upgrade from lower-quality space. While not yet cause for cele-
bration, it was enough to shave a half-point off of the national average National Average Rental Rates
vacancy rate for downtown Class A office space, which declined from $60.00
13.8% in 2009 to 13.3% in 2010 after rising almost 35% the previous
$50.00
year. The national average rental rate for Class A space in the CBD
slipped 14.1%, from $37.11 in 2009 to $32.51 in 2010, after falling $40.00
more than 24% the previous year.

$30.00
The trends were similar in the suburbs, as the proverbial flight to quality $20.00
lent support to Class A occupancy at the expense of Class B and C

properties. The national vacancy rate for suburban Class A office $10.00
space increased to 17.1% in 2010, up 40 basis points from 2009. $0.00
Meanwhile, the average rental rate for suburban Class A space held 2005 2006 2007
Downtown-Class A
2008 2009
Suburban-Class A
2010
Bulk Warehouse
steady at $25.45, down just pennies from $25.48 a year ago. Manufacturing
Service Centers
Hi-Tech/R&D
Power Centers
Downtown Retail
Regional Malls
Markets continue to be weighed down by sluggish growth and

stubbornly high unemployment rates. However, a positive sign that
demand is increasing are reports that the amount of available sublease National Average Vacancy Rates
space is declining. This is partially due to leases burning off and space 2005 2006 2007 2008 2009 2010
being absorbed, but is also attributable to companies taking sublease O ffice

11.9% 9.9% 9.6% 10.3% 13.8% 13.3%
Downtown-Class A
space off the market in anticipation of their near-term growth needs. Suburban-Class A 11.9% 13.2% 12.9% 13.0% 16.6% 17.1%
After a disastrous 2008-2009, the nation’s retail markets also appear Industrial
Bulk Warehouse 9.5% 10.7% 9.1% 7.4% 10.9% 10.7%
to have stabilized. While some markets still struggle to fill big boxes Manufacturing 9.3% 8.7% 7.6% 7.8% 10.9% 10.9%
vacated by national chains, others have seen new entries and local Hi Tech/R&D 11.1% 11.9% 11.4% 11.2% 12.3% 12.2%
retailers upgrading to better locations. The national average vacancy R etail

rate for downtown/CBD retail space stood at 8.2% in 2010, down Downtown Retail 7.3% 7.4% 6.6% 7.5% 8.9% 8.2%
Service Centers 8.0% 7.8% 7.2% 8.4% 11.7% 12.7%
from 8.9% in 2009, while rents slipped marginally, from $39.90 in 2009 Power Centers 6.7% 6.0% 5.3% 5.9% 9.9% 9.3%
to $39.79 in 2010. The national average vacancy rate for power Regional Malls 5.6% 5.4% 4.8% 5.6% 7.0% 6.5%
centers declined to 9.3% in 2010 after rising more than 30% the Source: NAI Global
previous year. Still, the national average rental rate for power center
space declined 3.3% to $18.53.
The nation’s industrial markets also appear to be on the mend. While National Average Vacancy Rates
demand for warehouse space continues to be weighed down by weak
consumer demand, the market has benefited from a diminishing 18.0%
pipeline of new construction. Vacancy rates for bulk warehouse space 16.0%
stood at 10.7% in 2010, down from 10.9% in 2009. Rentals rates 14.0%
slipped marginally, from $4.60 in 2009 to $4.55 in 2010. 12.0%
10.0%
While the massive wave of foreclosures and REO sales we originally 8.0%
expected never materialized, investment sales transaction volume 6.0%
increased and cap rates compressed in virtually every property sector 4.0%
throughout the year. Real Capital Analytics estimates total sales trans- 2.0%
action volume will surpass $100 billion in 2010, roughly doubling the 0.0%
2005 2006 2007 2008 2009 2010
$54 billion in sales recorded in 2009. The momentum building at Downtown-Class A Suburban-Class A Bulk Warehouse
year’s end points to a hopeful outlook for 2011. Manufacturing

Service Centers
Hi Tech/R&D
Power Centers
Downtown Retail
Regional Malls
2011 Global Market Report n www.naiglobal.com 4

U.S. Overview U.S. Gross Domestic Product
(Real - 2008 $)
With development non-existent, real estate’s near-term future is all about the strength 16
14
and timing of the economic recovery. A modest recovery has occurred since the 12
$ Trillions
10
recession ended around July 2009. And only a weak recovery will continue as long as 8
6
dollars are directed from the private to the public sector, and until the “rules of the 4
2
game” stabilize. 0
1984 1989 1994 1999 2004 2009
Real GDP has risen 3.5% since the second quarter of 2009, and is only 0.8% off of
the fourth-quarter 2007 peak. A robust job recovery to mediocrity is under way, with
613,000 jobs added from the December 2009 low point through September 2010,
according to the Payroll Survey, and nearly 1.6 million jobs added during that period, Real GDP Growth Rate
Year-Over-Year Percent Growth
according to the Household Survey. The Payroll Survey reported that 8.4 million jobs 10
8
were lost during the recession, and employment is still 7 million to 7.4 million jobs below 6
Percent
4
the December 2007 peak. 2
0
-2
Based on the Payroll Survey, total employment peaked in December 2007 at nearly -4
-6
138 million jobs, and bottomed two years later with 8.36 million fewer jobs. Since year-end 1984 1989 1994 1999 2004 2009
2009, we have gained back 613,000 jobs through September. In comparison, the House-
hold Survey, from which unemployment statistics are calculated, indicates that employment
peaked in November 2007 at just under 146.5 million jobs, bottomed in December 2009
Number of Persons Employed
almost 8.7 million lower, and has since grown by over 1.6 million. The “truth” is
160
somewhere in between. 140
Millions 120
The key for the real estate sector is job growth, as a recovery without jobs does not
100
fill much space. According to the June 2010 Job Openings and Labor Turnover 80
Survey, just 48% of industries are adding workers on a 12-month moving average basis, 60
1984 1989 1994 1999 2004 2009
versus the nine-year average of 50%. The good news is that all major industries have Payroll Survey Household Survey
registered employment gains from their respective troughs. Aside from the government
sector (64,000), the largest absolute job increases were in professional and business
services (365,000), leisure and hospitality (133,000), manufacturing (127,000) and trade,
transportation and utilities (104,000). On a percentage basis, the largest gains were U.S. Payroll Employment
Year-Over-Year Percent Change
made in mining and logging (10.8 %), professional and business services (2.2%), 6
4
manufacturing (1.1%) and leisure and hospitality (1%). 2
Percent
0
At 9.6%, the October 2010 unemployment rate reflects a 50 basis point decline -2
compared to the peak of 10.1% in October 2009, but has stayed flat for several months. -4
The median unemployment duration stands at 21.1 weeks, a significant decline from -6
1973 1979 1985 1991 1997 2003 2009
25.5 weeks just four months earlier. The percentage unemployed more than 27 weeks
declined in the last four months, and stood at 42% in October, significantly higher than
the low of 17.5% in December 2007, but below the 46% high in June 2010. At the
same time, short-term (five weeks or less) unemployment spells account for 18% of the
Percent of Industries Adding Workers
unemployed, compared to 36.5% at the beginning of the recession. Both metrics are (12-month moving average)
70
showing early signs of improvement. 60
50
Percent
Seasonally adjusted annual single-family home starts reached an all-time low of 360,000 40
30
homes in January 2009, compared to a 48-year (1960-2008) historical average of nearly 20
1.1 million. This annual rate stood at 452,000 new single-family home starts as of 10
0
September 2010. Similarly, multifamily (5+ units) starts averaged about 375,000 units 2002 2003 2004 2005 2006 2007 2008 2009 2010
per year between 1964 and 2008, hitting a low annualized rate of 62,000 new units in

February 2010 and standing at 150,000 in September. As jobs are created, causing up
to 2 million pent-up households to form, about 1.2 million new single-family homebuyers 12
U.S. Civilian Unemployment Rate
and an estimated 800,000 new renters will emerge. This is on top of the 2.3 million house- 10
holds that will form as the result of population growth of 6 million over the next two years. 8
Percent
6
Meanwhile, we anticipate that only 1.2 million to 1.3 million single-family and 400,000 4
multifamily home starts will occur over the next two years. The net result will be that we will 2
0
burn through the excess inventory. Low single-family inventory levels will create upward 1969 1974 1979 1984 1989 1994 1999 2004 2009
pressure on home values, restoring some lost confidence in homes as an investment.

Housing prices reached bottom over a year ago and have since witnessed a strength-
ening upward movement. For the first time since early 2006, both the Case-Shiller and Percent of U.S. Unemployed
60
the National Association of Realtors home price indices registered positive year-over-year
50
and quarter-over-quarter returns in the second quarter of 2010. The Case Shiller and the 40
Percent
NAR indices grew by 3.5% and 1.5%, respectively, year-over-year. The broader FHFA 30
20
government home price index posted positive quarter-over-quarter growth (0.9%), but 10
negative year-over-year growth (-1.6%), albeit less negative than previous quarters. 0
1995 1997 1999 2001 2003 2005 2007 2009
Consumer confidence has rebounded from its extreme cyclical low of 56.3 (February > 26 Weeks < 5 Weeks
2009), but has been on the decline for most of 2010 after gaining ground in 2009.
It reached a pre-recession peak of 96.9 in January of 2007, before plunging to a low of
56.3 in February 2009, and stood at 68.2 as of September 2010. We expect it to return
U.S. National Home Price Indices
to a normalized level of 90-95 in mid-2011. The improvement in consumer confidence is 280
260
mirrored in the business community, where the S&P 500 rose from a low of 676.5 in 240
Index Value 220
200
March 2009 to a high of 1,217 in late April 2010. It hovered around 1,100 for most of 180
160
2010, but broke the 1,200 mark again in November. 140
120
100
The rebound in corporate profits is the strongest driver of job growth. However, in the 1991 1994 1997 2000 2003 2006 2009
absence of predictable and stable rules of the game (at least until after the new Congress NAR (NSA) FHFA (SA) Case-Shiller (SA)
and Obama administration figure out how they will function together), profits will remain
undistributed and largely economically “inert.”
U.S. National Home Price Indices
The bottoming of private pricing (peaking of cap rates) occurred about 15 months after 280
260
240
REIT pricing bottomed in March 2009. Since peaking in the fourth quarter of 2009,
Index Value
220
200
total REIT implied cap rates have fallen by approximately 290 basis points from 9.2% 180
160
to 6.3%, representing an FFO multiple increase from 10.9x to 15.9x through mid- 140
120
September 2010. In fact, our analysis suggests that as of November 2010, REITs are 100
1991 1994 1997 2000 2003 2006 2009
approximately 18% over-valued relative to BBB bonds, and fairly-priced based on the NAR (NSA) FHFA (SA) Case-Shiller (SA)
Capital Asset Pricing Model.

Real estate prices today are effectively being set by investors who, de facto, believe in
relatively strong economic growth (and hence reduced vacancy and increased rents)
and/or high future inflation. The critical question facing real estate investors today is, “With
University of Michigan Consumer Sentiment
10-year Treasury rates hovering around 2.5% for the past two months, what if the bond 120 1984 = 100
market is right?” Rates have not been this low since 1954. Based upon the historical real 100
expected return of 200 basis points, this suggests an annual expected inflation rate 80
of just 0.5% over the next 10 years. The bond market is saying that it believes the U.S.
60
can sustain huge federal budget deficits and substantial liquidity injections from the
40
Fed without any inflation for the next decade. 1979 1984 1989 1994 1999 2004 2009

Private real estate values have fallen, but not by as much as did REITs. The improved
S&P 500 Index
outlook for new CMBS issuance and the recent improvement in mortgage lending means 1,600
that the upcoming refinance wave will resolve itself. Specifically, huge chunks of land, 1,400
1,200
unfinished developments and broken condos will simply be written off and sold for $0.05- 1,000
$0.25 on the dollar. On the other hand, cash flow assets with good interest coverage will be 800
600
able to roll over maturing debt with a high degree of success, particularly with both long- 400
and short-term interest rates at historic lows. These low interest rates allow owners to 200
0
refinance to greater proceeds than otherwise possible, and also yield additional net of interest 1955 1961 1967 1973 1979 1985 1991 1997 2003 2009
payment cash flow with which to service tenant improvements and capital expenditure.
The Office Sector

Financial Sector Corporate Profits
(Real 2008 $)
In the second quarter of 2010, the national office vacancy rate stood at 14.3%, an 600
500
80-basis point drop from the previous quarter, but 60 basis points above one year earlier. 400
$ Billions
This puts U.S. office vacancy above its “natural rate” of roughly 10%. Severe job losses 300
200
have resulted in increasing shadow or sublease space, along with tenant inducements. 100
With employment growth back on the positive side, the worst is over, but it will be a long 0
-100
recovery back to mediocrity. We do not expect market conditions to be in general 2001 2003 2005 2007 2009
balance until at least 2013.

The good news is that the Linneman Real Estate Index (LREI), which compares the
fundamental demand for space with the supply of real estate capital, finally reversed 4.5
REIT Bond Issuance
course in the third quarter of 2009, after a 12-year run-up. The supply of real estate 4.0
3.5
capital (the numerator) is proxied by the aggregate flow of commercial real estate debt, $ Billions 3.0
2.5
while the demand for space (the denominator) is proxied by nominal GDP. Excluding the 2.0
1.5
net real estate equity flows from the numerator slightly understates an oversupplied 1.0
0.5
market and overstates an undersupplied market. That is, this index tends to understate 0.0
capital oversupply situations. An index of 100 (base year = 1982) indicates that the supply 1999 2001 2003 2005 2007 2009
of real estate capital is roughly justified by the current demand for commercial space.
In the second quarter of 2010, the LREI declined to 155, from its first-quarter level
of 159. This was also a year-over-year decrease from 169 in the second quarter of 2009. Public and Private Market Real Estate Values
(2001 = 100)
The current LREI level indicates that the balance of commercial mortgage debt in the 350
300
market exceeds demand for the space financed by that debt by 55%. 250
200
We have long said that property markets are over-leveraged on a national level. The index 150
100
has been increasing steadily since 1997, when it stood at 91. At that time, the market had 50
0
a capital shortage and vacancies were declining steadily. Previously, we indicated that the 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
LREI would fall in the face of the current credit crisis. In fact, commercial debt outstanding MSCI U.S. REIT Index (Public)
Moody's/REAL Commercial Property Price Index (Private)
has fallen precipitously, but given the weak economy, corresponding GDP has declined at
a faster rate. As a result, the LREI continued to increase through the second quarter of
2009, but then finally reversed as GDP strengthened. We expect the LREI to continue to
decline as the rebound in GDP growth outpaces commercial mortgage lending.
Monthly Historical Global CMBS Issuance
70
60
The Industrial Sector 50
$ Billions
40
The U.S. industrial vacancy rate, according to NCREIF (primarily representing institu- 30
20
tional-quality properties) dropped, from 12.4% in the first quarter of 2009 to 9.9% in 10
the second quarter of 2010. The NCREIF series trended sharply downward during 0
1999 2001 2003 2005 2007 2009
the recession, but changed course over the last three quarters, indicating that the Source: Commercial Mortgage Alert
institutional-grade properties in the NCREIF survey were not immune to the wide-reaching
economic downturn.
The Multifamily Sector
NCREIF U.S. Office Vacancy Rate
18
The Census Bureau’s quarterly Housing Vacancy Survey indicates that the U.S. multi- 16
14
family vacancy rate remained stable in the second quarter of 2010 at 10.6%. This series 12
Percent
10
has generally been hovering around 10% since late 2003. For NCREIF’s more institutional 8
6
properties, the national vacancy rate declined by 106 basis points, from 6.96% in the 4
2
first quarter to 5.9% in the second quarter of 2010. This discrepancy in vacancy rates is 0
1995 1998 2001 2004 2007 2010
due to the fact that the NCREIF properties are generally of higher quality than the Census
properties. Thus, better-quality properties are exhibiting notably stronger fundamentals.
During the recession, the Census vacancy rate has been relatively flat, but it increased
100 basis points in the second and third quarters of 2009. In contrast, the NCREIF series
U.S. Office Construction
exhibited a sharp increase from early 2006, as unsold high-end condos were converted 40
35
to rental units. The second-quarter decline indicated that the condo market overhang 30
25
$ Billions
may be subsiding. 20
15
10
Multifamily starts (5+ units) have declined significantly to 95,000 in the second quarter of 5
0
2010, versus 20- and 40-year averages of 395,000 and 429,000 units, respectively. This 1995 1998 2001 2004 2007 2010
reflects the confluence of weak recessionary demand (due to doubling up of households), Nominal Real 2008 $
an absence of construction financing and a 5.9% vacancy rate. We anticipate that

multifamily starts will remain weak well into 2010, in the face of continuing soft demand
and a dearth of construction debt. 20
Vacancy Rates by Property Type
18
16
The lack of construction is good in the near term (unless you are a developer), because 14
12
there is a fair amount of vacancy due to the fact that when the economy shed jobs, Percent
10
8
people doubled up households. As labor markets improve and we start to add jobs, 6
4
these young people will move into their own space, absorbing the empty units. The lack 2
0
of construction means that excess inventory is being absorbed. 1983 1988 1993 1998 2003 2008
Office Retail Apartment Industrial
Source: NCREIF
To a large degree, the sector’s high vacancy rates reflect the fact that as the economy
plunged, household formation rates also plunged. Simply stated, when jobs are lost,
young people double up either with families or friends, forestalling household formation.
In 2008 and 2009, household formations were 772,000 and 398,000, respectively, versus Linneman Real Estate Index
200 and NCREIF Vacancy Rates 20.0
a norm of 1.1 million to 1.2 million per annum. This pattern has continued through 2010,
Vacancy Rate (%)

Index (4Q82 =100)
150 15.0
resulting in pent-up demand of roughly 2 million households. Of this pent-up demand,
100 10.0
approximately one-third will flow into multifamily, two-thirds into single family housing.
50 5.0
As consumer confidence returns and job formation resumes, these people will form their 0 0.0
own households, leading to a surge in housing demand. As a result, we are bullish on 1980 1984 1988 1992 1996 2000 2004 2008
LREI Industrial Office Multifamily
the long-term investment prospects for multifamily housing. In addition, given the sector’s
short-term leases, the multifamily sector will be able to best combat rising debt costs
should the economy experience a severe inflationary spike.
Through 2011, we expect aggregate demand growth to be about 810,000 units, with
Multifamily and Commercial Mortgages
no net increase in supply. Thus, the current excess vacancy of 1 million units will fall to Outstanding
about 200,000 units, leaving the multifamily vacancy rate at roughly 7.5% by mid-2012. 3,500
3,000
$ Billions
2,500
2,000
1,500
1,000
500
0
1997 1999 2001 2003 2005 2007 2009
Multifamily Commercial

The Retail Sector
NCREIF U.S. Industrial Vacancy Rates
At 10.1%, NCREIF’s second-quarter 2010 retail vacancy rate fell from 10.8% in the first 20
quarter, but was 26 basis points higher than one year earlier. The vacancy rate broke 6% 15
Percent
in the second quarter of 2008 for the first time since 1999. It is important to note that 10
much of this retail vacancy exists in centers built to service residential communities that 5
never materialized in the outer reaches of markets like Las Vegas and Phoenix. They 0
were built in anticipation of a soon-to-be thriving residential community, but as reality set 1990 1994 1998 2002 2006 2010
in and home building ceased these centers are now serving communities 60-90% smaller
than anticipated. This type of vacancy stands in contrast to rising vacancy in established
market areas, which is occurring to a lesser degree.
U.S. Industrial Construction
80
The University of Michigan consumer confidence index dropped to 67.8 in July 2010, 70
compared to its low of 55.3 in November 2008. The index had not seen the low of 2008 60
$ Billions
50
since 1980. Real retail sales peaked in November 2007 at $349 billion, and have since 40
declined to $323 billion through July 2010. Retail construction has been declining steadily 30
20
on a monthly annualized basis, and was recorded at $25 billion as of June 2010, down 1995 1998 2001 2004 2007 2010
from its October 2007 high of $62.6 billion. Nominal Real 2008 $
Multifamily Unit Construction Multifamily Construction and Vacancy Trends U.S. Multifamily Vacancy
80 12
350 11
70
Thousands of Units
10
Vacancy Percent
300 10
60
Thousands
250 9 Percent
8
50
200 8
40 6
150 7
30
100 6 4
20
10 50 5 2
0 0 4
0
2000 2002 2004 2006 2008 2010 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010Q1
1980 1984 1988 1992 1996 2000 2004 2008
Total in Bldgs w/ 5 or More Units (Thousands) Vacancy U.S. Census Bureau NCREIF
Built For Sale Built For Rent
U.S. Retail Vacancy New Condominium Completion & Absorption

U.S. Multifamily Housing Starts & Perm
1,400 12 100
Thousands Completed
1,200 100
Absorption Percent
10 80
1,000 80
Thousands
Percent
800 8 60
60
600 6 40 40
400 20 20
4
200 0 0
0 2
1995 1997 1999 2001 2003 2005 2007 2009
1964 1969 1974 1979 1984 1989 1994 1999 2004 2009 0
90-Day Absorption Rate Completions, Trailing 4 Quarters
Starts Permits 1995 1998 2001 2004 2007 2010
U.S. Multifamily Construction U.S. Retail Construction Percentage of New Units Intended for Sale in
70
70 Multi-Unit Buildings
60 60 60
$ Billions
50 50 50
Percent
$ Billions
40 40 40
30 30 30
20
20 20
10
10 10
0
1995 1998 2001 2004 2007 2010 0
1993 1995 1997 1999 2001 2003 2005 2007 2009
Nominal Real 2008 $ 2000 2002 2004 2006 2008 2010
Nominal Real 2008 $

Canadian Overview
The Canadian economy, led by exports and a strong commodity cycle, performed well
through 2010. Anchored by a stable banking sector, the Canadian economy outper-
formed most other economies in the western world. GDP growth is expected to be 3.0%
for 2010, but the overall economy faces headwinds going forward. In particular, a weak
U.S. dollar has driven the Canadian dollar towards parity, slowing Canada’s trade with
its largest trading partner. And the modest recovery in the U.S. will temper Canadian
growth prospects for 2011, now forecast at 2.3%.
The Canadian economy has gained back all of the jobs lost during 2008 and 2009, but
the unemployment rate remains at 8%. There is modest employment growth forecast for
2011 but also considerable slack in the economy. While the Canadian real estate recovery
has not been dramatic, as we enter 2011, the supply-demand characteristics of this
sector appear balanced in most markets. Liquidity is returning, as evidenced by REITs
and other publicly traded real estate investors that have raised substantial amounts of
equity capital in 2010. While banks and investors remain cautious, there is increased
investment and construction activity taking place.
The ownership of commercial real estate in Canada, especially the best located properties,
is concentrated among pension funds, REITs and large domestic corporate investors.
The best assets remain in relatively strong financial hands with conservative leverage
employed. With the Canadian dollar close to par with the U.S., there is increasing interest
by these investors in U.S. real estate assets. In addition, these pools of capital are looking
to Europe and Asia to satisfy the demand for high quality real estate.
Land prices firmed throughout 2010 in most markets across the country. Generally,
cap rates compressed as interest rates declined slightly. Transaction volumes are no
longer constrained by lack of financing but will remain slow due to the low supply of
good quality product.
Western Region (British Columbia, Alberta, Saskatchewan and Manitoba). The western
region of the country possesses abundant natural resources and is performing well,
driven by resource exports. The Vancouver office market has a vacancy rate of 8%,
but has little new product coming online in 2011-2012. This combined with positive
absorption should yield stable pricing in the next 12-18 months. The Victoria office
market, which is dependent on the space demands of the provincial government, has
seen increasing vacancies as government spending is reduced to contain fiscal deficits.
Industrial real estate in Vancouver is less active but land prices have moved up. The
average vacancy rate is 4.5%. In Victoria, the industrial rents are stable due to the lack
of new supply, and vacancy rates are less than 2%. Investment in commercial real estate
product in British Columbia has been resilient, with cap rates around 6-7% in the major
urban centers. The Greater Vancouver investment market has normalized and is now
characterized by some shortages in supply.
Alberta is home to Canada’s oil and gas industry, with Edmonton and Calgary serving
as the two main business centers. Edmonton, the provincial capital, benefits from its
proximity to the infrastructure related to tar-sands development. Meanwhile, Calgary is
the home of most of Canada’s energy companies. Alberta’s recovery will continue to be
impaired by low gas prices which have endured over the last year and are projected to
continue in the foreseeable future. Despite this, the economy has rebounded.
With the exception of Calgary’s office market, which has 3 million square feet of over-
supply, the overall fundamentals of Alberta’s real estate market are projected to improve
in 2011.
Saskatchewan and Manitoba are smaller, resource-and-farm based economies.
Saskatchewan has resisted the general economic downturn and proven to be an “oasis”
due to its abundant natural resources and strong agri-business. The two largest cities
are Regina and Saskatoon, with a combined population over 500,000. The unemploy-
ment rate is low (below 5%), and as a result, industrial market vacancies remain at
an all-time low, while rental rates continue to hold up due to limited new construction.
Industrial land prices remain steady at $225,000/acre.
The Regina office market is experiencing positive absorption and vacancy rates remain
extremely low at 3.0%. New office supply totaling 240,000 square feet is expected to
come on line by the end of 2012.
Finally, the Saskatchewan investment market remains strong with continued interest from
local investors. Cap rates are between 7.5-8.5% for well-located, well-tenanted projects.
Eastern Canada (Ontario, Quebec and Atlantic provinces). Eastern Canada is the
country’s manufacturing base. Both the Ontario and Quebec economies are experiencing
higher than normal unemployment (at 8.8% and 7.7%, respectively), but have slowly
recovered during 2010. Rental rates in the region have remained steady in most
submarkets but inducements have increased. The industrial markets have been harder
hit in this regard, that the retail, office or multifamily sectors.
Toronto is Canada’s largest city and its financial and manufacturing center. The surrounding
area in southwest Ontario is home to Canada’s auto manufacturing sector. Greater Toronto
is a multi-cultural mega-city with 5.6 million residents and a broad economic base.
Toronto is also Canada’s largest real estate market. The Toronto office market has been
healthy and active. Approximately 3 million square feet of new Class A space was added
in 2010, but strong demand has meant that vacancy rates are stable or declining. Current
vacancy in downtown Toronto is 7.5% but most suburban markets have double-digit
vacancy rates. Another 1.5 million square feet of new office product is expected to come
online in 2011, which should put upward pressure on vacancies.
Toronto’s industrial market has not made a full recovery, and shadow vacancy abounds.
There is little new supply coming to market so we expect rental rates to firm up and
vacancy rates to decline in 2011.
Montreal has a diverse economy and a mature real estate sector. The greater Montreal
area accounts for more than 21% of the entire Canadian office market. This market
remains healthy with an office vacancy rate of 9.3%. With little new construction in the
pipeline, vacancies should decline through 2011. Similarly, the industrial vacancy rate of
7% is also expected to decline during the coming year, as improved business confidence
driven tenant expansions.
Like many centers of government, Ottawa remains a steady market, even in these tough
economic times. The federal government has ongoing space needs and continues to
refurbish and redevelop its properties. The construction of a new convention center is a
welcomed addition to the CBD.

Europe
Europe mounted a modest recovery in 2010, with European GDP growth within the Euro
zone improving from -0.4% in 2009 to 1.7% in 2010. However, growth is uneven across
the region and is projected to be only 1.1% in 2011.
The north-south and east-west divide generally has been reinforced. The “powerhouse”
of the Euro zone through the first three quarters of 2010 was Germany, which contributed
60% of the region’s total growth. There has also been a recovery in the UK and the Nordic
region. The more export-oriented economies such as Poland, Germany, France, The
Netherlands and Sweden are expected to recover ahead of the remainder of Europe.
Meanwhile, the Piigs (Portugal, Italy, Ireland, Greece and Spain) were the primary concern
in early 2010, and appear to be in a prolonged recession. Following an initial €110 billion
rescue plan for Greece, a European Union/International Monetary Fund emergency
funding package of €720 billion was ratified in May to “stabilize” the Euro zone. Through-
out Central and Eastern Europe (CEE) the recovery remains protracted, though in certain
countries there has been a turnaround. The region has received a €52 billion IMF-led
support package. Poland, the only EU state to avoid recession, has performed particularly
well, along with the Czech Republic, Slovakia and Slovenia.
There has been a general shift from the fiscal stimulus seen in 2009 to a much needed
fiscal austerity across the region. In October, the UK Coalition Government announced
its plan to cut public spending by €81 billion by 2014-15 with a loss of 500,000 public
sector jobs (at least on paper, though many are simply the cancellation of planned new
hires). This will improve consumer sentiment and GDP growth in 2011.
European real estate markets will remain challenging in 2011, though continuing low
interest rates may balance out some of the adverse market pressures. The fiscal squeeze
will reduce inflationary pressure, allowing central banks to slowly raise interest rates.
The Office Sector

Office rents across the region have stabilized after significant declines in 2008-2009, with
prime rents in the larger global centers starting to rise, particularly in Paris, Barcelona,
Moscow, and London. In each of these cities, there is a shortage of buildings with available
large floor plates in the heart of the financial district.
Across Europe, but particularly in the major western European capitals, take-up volume
increased for prime Class A accommodations, spurring developers to dust off plans for
major projects that were put aside during the depths of the recession. Within the prime
centers in Central and Eastern Europe, the significant growth in supply prior to the
recession was followed by a drop in take-up of over 30% post-2008. The real estate
recovery remains uneven in this region.
Outside of CBDs, vacancy rates, particularly in the regional cities and for secondary
offices, remain weak across Europe. European vacancy rates generally appear to have
stabilized at around 10% of stock, but remain higher at around 16% in the CEE.
Occupiers are cautious about taking on new space. However, rents have fallen to a level
that makes new accommodation affordable, particularly when rent-free periods, landlord
incentives, capital contributions and shorter leases are taken into account.

The Industrial Sector
The European industrial markets have stabilized as speculative development has virtually
ceased across Europe since 2009. New construction starts in 2010 have been limited
to build-to-suit projects. Demand has strengthened throughout 2010, particularly for
“multi-modal” modern warehouses within key logistics hubs offering access to airports
and major sea ports. However, securing financing for development, even with pre-leasing,
remains a challenge.
Developers such as Prologis successfully focused their attention throughout the year on
securing tenants for their available space. Demand skews towards smaller unit sizes, but
rentals of larger spaces are occurring. The majority of UK projects started have been
build-to-suit space for retailers. In addition, the demand from the food industry and its
distribution players has been fairly consistent through 2009 and 2010.
Across Europe, occupiers have taken advantage of weak leasing market conditions to
move their operations from older warehouses into modern facilities. Overall vacancy rates
across Europe have remained steady at around 15%, with significant regional variations.
Throughout the year, owners have been forced to offer substantial incentives, shorter and
more flexible leases, rental concessions, rent-free periods, and enhanced build specifica-
tions and capital contributions towards tenants’ fit-out costs. Headline prime rents generally
have remained stable throughout the year, though again with substantial regional variations.
The Retail Sector

Retail rents across Europe generally have stabilized, with premier, well-managed retail
centers remaining in high demand. Meanwhile, the gap between primary and secondary
locations is widening.
Throughout 2010, lower interest rates and muted inflation have helped consumer
demand. However, consumers remain cautious about spending. This is likely to result in
limited retailer expansion in 2011.
The Investment Sector

Investment volumes increased in 2009 and through 2010, with downward pressure on
yields for prime property. There is some evidence of softening, as investors remain
selective, focusing almost exclusively on well-let prime assets in core locations in the
top Western European cities.
The most significant increases in trading volume, and yield compression occurred in the
fourth quarter of 2009 and first quarter of 2010. However, occupancy concerns remain
about the strength of the European economies and the prospect of higher inflation and
interest rates in 2011-2012.
The most active investment markets were in the UK, Germany and France, followed
by Poland and Sweden. Investment volumes were markedly down in Greece, Turkey,
Switzerland, Belgium, and Finland. The markets in Austria, The Netherlands, Norway,and
Russia were generally flat.

Data from Real Capital Analytics shows that total investment in European commercial
property was around €22.18 billion in Q1, and €24.9 billion in Q2 2010. These figures
are 45% above 2009, but remain 70% below their 2007 peaks.
Cross-border activity has contributed strongly to increased transaction volumes. Of the
€91 billion of commercial property transactions in Europe over the past 12 months, 35%
were cross border. The UK, Germany and France benefited the most from cross-border
activity, with some 43% of these transactions involving foreign investors. Approximately
75% of this activity was by non-European investors. The sources of non-European
investment were the U.S., South Korea and the Middle East. Within Europe, the most
active cross-border investors were from Germany, the UK, Sweden, The Netherlands
and France. As in previous years, German investors were the most active across Europe,
acquiring €4.7 billion of assets outside of Germany in the last year.
Yields on office acquisitions in London, Paris, and Berlin are typically in the mid-6% range,
but prime yields are approximately 5% in London and Paris. Retail yields remain the
lowest, with high street retail yields remaining below 6%.
While the major markets of London, Paris, and Berlin saw marked increases in transaction
volumes during the first half of 2010, significantly greater increases were recorded in
secondary markets, such as Manchester, Nice, and Cologne. Stockholm also witnessed
volume increases, and five cities in Germany were among the most active markets in
Europe. The increasing activity in the secondary markets in Western Europe, coupled
with gains recorded in Poland and a small number of Eastern European markets,
indicates that investors are slowly venturing beyond the first-tier cities again. However,
the critical factor remains consumer demand over the coming 12-24 months.
Asia Pacific
One year after the deepest recession in 40 years, Asia is leading the global recovery. As
with many developing markets, Asia rebounded swiftly in 2009 and into 2010. In the near
term, the region is expected to continue leading the global recovery. The global crisis
highlights the importance for Asia to ensure that private domestic consumption becomes
a more prominent engine of growth, versus the traditional export model associated with
China and much of Southeast Asia
According to the Asian Development Bank, Asian region real GDP is expected to grow
7.9% in 2010, driven by better than expected exports and strong private demand.
However, despite the economic recovery experienced in 2009-2010, downside risks
remain, which temper the enthusiasm. Areas of concern include the uncertain global
environment, the sustainability of domestic consumption and the challenge of managing
capital inflows and exchange rates. As such, GDP growth in the region for 2011 is
projected to be a low 7.3%.
We expect continued strong growth in the industrialized markets of East Asia, including
Hong Kong, Taiwan and South Korea. Improved investment, healthy consumer spending,
robust exports and industrial production will propel growth. Despite measures to cool
the China property market and slow credit growth, China grew at 11.1% (annualized)
in the first half of 2010 and is expected to grow at 10% for the year.

In Japan, the yen is the strongest that it has been in over 15 years, with a negative effect
on its legendary export sector rippling throughout the economy. GDP growth for 2010
is projected to be flat or slightly negative, with 2011 projected at 2%.
Markets in Southeast Asia, including Singapore, Malaysia, Thailand, Philippines and
Indonesia have also exceeded expectations, fueled by strong exports, robust industrial
production and improved consumer confidence. Singapore is positioned for a solid 2010
at 9% growth after growing 18.1% in the first half of 2010. Singapore’s growth has been
fueled by the financial sector, private banking, healthcare, tourism, and robust demand
for manufactured exports, particularly biomedical and semiconductors.
Malaysia and Thailand also posted double digit growth in the first half of 2010. Malaysian
growth was supported by strong domestic consumption, private investment and a
recovery in exports. In Thailand, despite the major disruptions of the Bangkok protests,
the economy is forecast to grow at 5.5% for 2010, driven by healthy exports and
a recovery in tourism. Indonesia is projected to expand by 6%, supported by strong
domestic demand.
India has also experienced a comeback, with growth projected at 8.8% for 2010 and 8.4%
for 2011. India’s growth has been predominantly anchored by increased domestic
consumption, increased private and corporate investment and a return of foreign and
domestic demand in the IT and ITES sector as well as residential, logistics and retail demand.
In the Pacific region, the Australian central bank displayed its confidence in the country’s
economic recovery by raising interest rates by 25 basis points, placing the official cash
target rate now at 4.5%. Unemployment has dipped down to the low 5% range. GDP
growth is estimated at 3% for 2010 and 3.5% for 2011.
Business confidence has rebounded tentatively in New Zealand with the recent reduction
in unemployment to 6%. GDP growth is projected at 2.9% for 2010, and 3.2% for 2011.
Major Trends in China.

Unprecedented rates of urbanization, infrastructure development, and the integration of
China with the rest of the world have led the way for the rapid development of Chinese
real estate markets. With virtually every major multinational corporation having a presence
in China, combined with a strong and growing domestic business base, China has
become one of the top five most active real estate investment markets in the world, with
international quality commercial properties in its tier 1 cities.
Shanghai and Beijing remain the market leaders in their respective fields. Shanghai for
commercial, finance, and logistics, and Beijing for administrative, political, educational,
technological, and the main HQ location for domestic companies. Against this backdrop,
we are witnessing the greatest urbanization, and arguably the fastest modernization, of
a nation in history. From a real estate perspective, China is generally implementing “best
practices” in city planning, infrastructure and architecture.
Some of the major trends in China are urbanization and migration with 11 mega urban
regions formed in China with goals to urbanize 70% of the country’s population
by 2030. The main drivers of this trend are government stimulus and massive infra-
structure development, together a manufacturing shift and population migration to
the inland regions of China.

Major city centers in China are pushing from the inner zones to the outer zones, shifting
people and economic activity to the suburbs. Meanwhile, massive numbers of migrant
workers have settled in peripheral areas of these major city hubs. The suburbs are
witnessing massive population growth as professionals move from expensive city center
property to more affordable, newly developed housing blocks in the suburbs. New
generations of business park spaces in China will provide an excellent alternative to
occupiers and operators that seek to reduce costs and expand.
Finally, the better second and third cities will be excellent locations for multinational
corporations and domestic companies looking to grow their China footprint. Many of
these cities offer lower cost labor, mission critical transportation links, good infrastructure
and open-minded government with aggressive incentive policies.
The Office Sector

Bolstered by the stronger than expected pace of recovery in most urban centers across
Asia, the region’s office markets displayed positive signs. A large number of multinational
corporations have reactivated their real estate plans. In markets like Hong Kong and
Singapore, large new office commitments were undertaken by the financial sector in
2010, with a simultaneous re-emergence of demand from investment banks, private
banks, private equity and hedge fund players.
As a result, some Asian markets are experiencing a shortage of prime office supply, as
the increased demand and flight-to-quality has absorbed much of the newer stock.
This is driving lower vacancies and higher rents, and pushing capital values upwards in
the best class of buildings, and correspondingly higher vacancies in the older stock of
buildings. A few of the top Asian markets are experiencing rapidly absorbed new prime
office stock, turning these markets into landlord-dominant markets with the availability
of large, contiguous prime spaces becoming limited and expensive. With demand growth
of 10-30% in 2010, we expect to see continued double digit rental growth over the next
12 to 24 months in Singapore, Hong Kong and Shanghai.
Net absorption regained significant momentum in markets like Hong Kong, Singapore,
Ho Chi Minh City, Shanghai and Seoul. Market risks associated with a significant pipeline
of new office projects will remain high in the large commercial centers in India and China.
In markets like Shanghai and Taipei, we have seen the relocation of back offices to
the city fringe into newer, high-quality buildings at considerable cost savings over high-
standard CBD alternatives.
With some supply-demand imbalances, there are still some select opportunities. For
example, there are great leasing opportunities currently in South India, particularly in
markets like Bangalore, Hyderabad and Chennai. In Shanghai, there is a large supply of
office space coming online. However, much of the 30,000 square meters of new supply
in the Pudong District is already pre-committed. Therefore, there are much better
opportunities for new stock in the Puxi District with nearly 500,000 square meters in the
pipeline. In Seoul, there are some new international standard office buildings offering very
attractive packages due to high competition and a record-breaking supply of new
projects now opening.

The Industrial Sector
Despite subdued demand by western firms, it has been impressive to see export growth
in 2010 above 30% in China and 27% in India. As Asia’s export-driven markets have
sold fewer exports to the West, they have sold more to each other and increased their
trade with Latin America, the Middle East and Africa. Export growth and industrial output
have continued their gradual climb, but rising Asian exchange rates and the associated
increase in manufacturing costs have added considerable pressure on South Korean,
Japanese, Taiwanese and Chinese exports.
The industrial property sectors in Tokyo, Shanghai, Beijing and Hong Kong have begun
to attract the interest of both foreign and domestic investors. Similarly, we have seen the
rental rates for industrial buildings beginning to stabilize in markets like Singapore, Hong
Kong, Shanghai and Beijing. Going forward, the pace of rental growth will be modest,
with a trend of 2-4% moving into 2011. The outlook for heavy manufacturing hubs like
Shanghai and Taipei has recently improved, with new orders in Taiwan leading to rising
demand for space and increasing rentals.
The Retail Sector

Consumer demand and retailer sentiment in most Asian retail markets held firm during
2010. As a result, retail rents for the best locations have generally remained solid. The
highest retail demand is in China, Hong Kong, Singapore, Taiwan, South Korea, Indonesia
and India. Retail markets in China are the healthiest in the region, especially in the
second-tier provincial capital cities. Other retail markets that are expected to perform
well include Sydney and Bangalore. The Japanese retail sector has remained weak, as
evidenced by the exit of several luxury retailers from prominent locations such as the
Ginza District of Tokyo.
Across the region, the balance of power has shifted to landlords, particularly as retail
rents have remained stable early in the recession. During 2009, regional retail rents
dropped by less than 2%, whereas regional office rents dropped by over 20% and in-
dustrial rents dropped by 7-10%.
The Investment Sector

Real estate investor sentiment is positive in most markets as fundamentals improve.
Many investors believe that both the property investment and leasing markets are stabi-
lizing and that assets can be attractively purchased. Institutional quality supply is limited
across the major Asian capitals, increasing competition and yield compression. In Tokyo
alone, we have witnessed yield compression of 100-150 basis points in the span of
six months, since early 2010.
Currency appreciation is an issue for cross-border transactions in the region. For example,
foreign investor sentiment has cooled for Japan and Australia as those currencies have
strengthened. Conversely, many Japanese investors are now contemplating overseas
investments due to the strong buying power of the yen, and the attractiveness of certain
distressed markets overseas. At the same time, this urge to invest overseas is restrained
to some degree because of the painful experience of Japanese investments overseas in
the 1980s.

We are seeing the greatest transaction volumes in Japan, China, Australia and Singapore
in 2010. Transaction volumes across the Asia Pacific region are expected to increase
20% over 2009 levels, to nearly US $80 billion. Singapore’s investment activity increased
over five-fold in 2010. China had high levels of investment transactions with predominantly
domestic investors driving the market, and limited foreign investor activity.
The sovereign wealth funds, real estate private equity funds, REITs, and the high net worth
segment have all been active acquirers of assets. Notable among the sovereign wealth
funds, we have seen large scale investment in Australasia (and Europe) by the National
Pension Service of Korea, the Qatar Investment Authority and GIC of Singapore. In addition,
the China Investment Corporation (CIC) and the Chinese insurance companies have
also become active, recently being approved to invest up to 10% of their assets in
property and 5% in private equity. As a result, the Chinese insurance industry should
inject an additional US $50 billion-$100 billion into real assets in the medium term for
institutional quality assets in China.
As Asian yields continue to compress and local currencies strengthen against the
U.S. dollar, we expect to see increased interest in the U.S. markets, particularly for
acquisitions of high quality assets at distressed prices. This will be especially true for of-
fice, hotel and residential properties in the best and biggest cities. As the U.S. banks
start to more aggressively dispose assets, we will see more deals by well-capitalized
Asian investors. The challenge will be to find the right match of distressed price and
well-located, quality product.
The Residential Sector

Housing prices and transaction volumes recovered in the second half of 2009, most
notably in Singapore, Australia, New Zealand, China, Hong Kong and South Korea. In
fact, prices in the broader residential markets generally exceed their 2008 peaks.
However, in certain markets low headline prices in 2008 were driven by relatively few
transactions as most owners were not compelled to sell at that time.
The strong recovery is partially attributed to unprecedented government measures to
mitigate the impact of the global financial crisis. These include historically low mortgage
rates and incentives to revive the long pent-up domestic real estate markets. Also playing
a role in the recovery were capital inflows and lots of liquidity.
While parts of the world continue to struggle with the housing bust, housing prices in
some Asian economies have recovered so quickly that some markets now face new risks
to financial stability. The pendulum has now swung in the other direction, with a number
of Asian countries implementing new, anti-speculative regulations to contain the potential
rise of a new property bubble. Examples of measures taken to cool the real estate
markets include tighter requirements on mortgage lending, increasing land supply and
higher transaction taxes.
In China, where economic growth and rising capital values go hand-in-hand, the
government has introduced new measures to cool the residential property markets,
including a limit to the number of home purchases by individuals, raising the minimum down
payment requirements, and mortgage rates in specific sectors regarded as more speculative,
as well as the exit of state-owned enterprises from the non-core property business.

In Hong Kong, the government raised the minimum down payment for units exceeding
HK $12 million (US $1.55 million) and for non-owner occupied units to 40%. In Singapore,
owners who sell houses and apartments in less than three years must now pay a 3%
stamp duty. In addition, the maximum LTV for non-primary residences has been increased
to 70%.
Despite all these measures, neither volumes nor sales values have been significantly
affected. It remains to be seen whether these cooling measures will be effective in
managing the delicate balance between avoiding a housing bubble and maintaining a
solid economic recovery.
Latin America and the Caribbean

The Latin American region witnessed remarkable growth throughout 2010. Initial growth
estimates of 4-4.5% for the regions were steadily revised upward as the major economies
showed impressive growth–Brazil and Argentina (7.5%), Uruguay (8.5%), Paraguay
(9.0%), Peru (8.3%), Mexico (5.0%) and Colombia (4.7%). The region’s growth has been
driven by strong domestic demand, healthy exports of raw materials to Asia (particularly
China), and increasing demand due to the modest recovery in the U.S. The region also
benefitted from an increase in domestic investment after years of off-shore investment.
The growth rate for the Caribbean region failed to exceed an initial projection of 2.4%,
while growth in the CARICOM countries (15 + 5 associate member countries) was close
to 0%. The lack of growth in this region is due to declines in remittances and tourism,
driven by the financial crisis and continuing economic problems in the U.S. and Europe.
Projections for the region in 2011 are hopeful. Latin America is expected to continue its
strong growth, and the Caribbean is expected to begin its recovery as tourism rebounds
due to improved economic conditions around the globe.
In 2010, South America and Mexico’s real estate sectors witnessed a strong resurgence
in development. Central America saw more moderate development activity, with the
exception of Panama, where growth remains strong throughout the crisis. The Caribbean
had more modest levels of construction, with the exception of the Dominican Republic,
which showed strong growth driven by the residential sector.
Demand for real estate is expected to increase in 2011, and the lack of recent develop-
ment will generally create a landlord’s market. Nevertheless, lease and sale rates for office
and industrial properties are not expected to increase significantly. In Brazil, office rates
spiraled upward by 15% to 25% in major cities, reaching as high as US $100 per square
meter for the finest Class A space. The retail sector may see lease rates increase
markedly within shopping malls and High Street locations in select markets (Brazil, Mexico
and Colombia) due to continued strong consumer demand and retailers’ need to expand.

Growth in real estate supply will increase in the larger economies such as Brazil, Chile,
Peru, Panama, Mexico and Colombia, with a more modest but steady revival in the
smaller economies of Central America such as Costa Rica and El Salvador. Greenfield
development in the industrial and office sectors is expected to continue due to the lack
of true Class A product throughout the region (with the exception of Mexico). Class A
office vacancy rates will remain below 5% in Buenos Aires, Bogota, Rio de Janeiro and
Sao Paulo. The notable exception to the regional vigor is Venezuela, which is expected
to suffer high inflation (above 20%) and negative economic growth. The challenge remains
for governments in the region to provide adequate infrastructure to meet the growing
needs of industry and a prospering population, which drives increasing retail spending,
particuarly in automobiles.
The emergence of domestic capital sources is a key trend. Since the beginning of the
financial crisis, much of the capital that was generated locally was directed to local
investment instead of being expatriated, while a significant amount of capital that had
been invested in foreign markets for many years was repatriated and directed to the local
development opportunities. This is expected to continue in the immediate future; domestic
markets are now seen as profitable places to invest.
Argentina.
The economy showed healthy growth during 2010, which is expected to continue during
2011. Helping this is the weakened Argentine peso, which stands at about 4 ARS to the
U.S. dollar. This has helped the country maintain a stronger export base, particularly in
the agricultural sector. Global exports will continue to increase, primarily in the agricultural,
textile and service sectors. Inflation is expected to remain high during 2011, peaking at
10%. There continues to be a shortage of available Class A product in the office, industrial
and retail sectors. Office vacancy will remain below 4%. Industrial and downtown retail
vacancies are below 3%, and demand will continue to exceed supply. The speculative
construction pipeline of industrial space is insufficient to meet current demand.
The Bahamas.
Both the tourism and banking industries–key economic drivers–remain weak. European
and U.S. tourist travel to the islands only slightly recovered. Construction of new hotel,
resort and residential projects is almost non-existent. The projected recovery in
the U.S. and Europe in 2011 will provide some relief, but tourism is not expected to
increase significantly until late 2011. Downtown retail and office market absorption remains
slow, but the rate of decline has decreased. Due to abundant parking and better access,
suburban markets continue to be the most desirable submarkets for growth and expansion.
Demand has kept vacancy rates low and spurred rare build-to-suit opportunities. Demand
is expected to increase slightly during 2011, particularly for industrial space
and Class A product in the suburban submarket. Interest in residential development and
hotels is expected to revive.

Brazil.
Brazil has proven to be one of the world’s most resilient economies, with an 8% growth
rate in 2010. The expectations of a continued economic boom are partially due to the
country’s large offshore oil deposits, strong and growing domestic consumption, Brazil’s
hosting of the World Cup in 2014, and of the Olympics in 2016 (causing public investment
in infrastructure projects), alternative energy sources (e.g., ethanol) and continued
bureaucratic reforms. In the near term, high business loan rates and bureaucracy
continue to limit the country’s growth. Risk perception among international investors
continues to decrease, with the Brazilian Real strengthening against the U.S. dollar, from
its low of 2.16 in late 2008 to 1.68 in late 2010. During 2010, the Brazilian real estate
market grew at a stronger and faster pace. The country remains an attractive target for
greenfield Class A office, retail and industrial development. Lease rates for all product
types increased, while cap rates hover between 9-11%.
Colombia.
Colombia shed the veil hiding its recent success, with numerous investment advisories
noting the country’s strong growth. Over the last 15 years, the country has steadily grown
and improved its democratic credentials. The Peso has been relatively stable, increasing
only slightly to 1,800 COP to the U.S. dollar. The expected approval of the Free
Trade Agreement with the U.S. will further benefit the economy. Real estate
development was strong during 2010, but demand exceeded supply. Prices for office,
retail, and industrial space increased slightly during the year. International investment
funds have yet to venture strongly into Colombia, but the domestic capital sources are
investing actively in greenfield projects. Given the lack of a transparent investment market
and a shortage of investment sales, cap rates are difficult to identify, but are estimated
to be 12% or greater.
Chile.
Chile continues to be a benchmark for emerging economies in the region, with the
Chilean economy recording another respectable year of growth. Inflation dropped, while
the 7% unemployment rate is among the lowest in Latin America. The recovering prices
for copper and other commodities, paired with an increase in global demand, aided the
Chilean economy. Additionally, its high capital reserves allowed Chile to avoid a financial
crisis, which could have resulted from the earthquake that hit the country in early 2010.
Its continued attempts to decrease its dependence on imports of natural gas—particularly
new hydroelectric projects in the Andes–is being hindered by ecological groups. Chile
is currently building its first Liquefied Natural Gas (LNG) terminal to secure enough of a
supply for its existing and upcoming gas-fired thermal plants. In addition, it has engaged
in the construction of several new hydropower and coal-fired thermal plants. Chilean
companies, profiting from their strong domestic economy, have changed from a mode

of cautious international expansion to a more aggressive stance. Their targets are
primarily Peru, Colombia, Argentina and Brazil, but Costa Rica and Panama, along with
the U.S., have been added to the list. Demand for quality commercial real estate
continues to be strong, with vacancies remaining below 3% across all sectors. Of the
developments slated for completion in 2010, the majority was completed on time and
those delayed only suffered a slow-down due to the earthquake in March. Rental rates
remained stable and cap rates are about 8-10%.
Costa Rica.
Although the U.S.-Costa Rica Free Trade Agreement went into effect on January 1, 2009,
notable benefits have not yet been achieved. The opening up of the telecom sector in
2010 and the surge of insurance operators (from the 2009 sector opening) provided a
boost to the economy. However, the pace of investment remains slower than expected.
Real estate activity picked up during 2010, with resort, hotel and second home sectors
on the Pacific Coast awaiting a rebound. In the central area of San José, leasing and
sale activity saw a marked increase in the office and industrial sectors, while the retail
sector showed a stronger demand recovery. Rental rates stabilized in the office and in-
dustrial sectors, and retail rates started to experience slight upward pressure in the shop-
ping malls and High Street locations. For 2011, absorption in the commercial sectors is
expected to increase, with a stronger uptake in retail. Rental rates are expected to be
stable in 2011 for the office and industrial sectors, but experience a slight increase in
retail. Along the Pacific Coast, recovery and renewed investor interest should start by
mid-year 2011. Land prices are weak, as development activity is very low and some
owners are trying to cash out. Overall, cap rates are above 9%.
Mexico.
Mexico rebounded strongly during 2010, with a 4.5% growth rate. It has regained its sta-
tus as one of the region’s doyennes. All sectors of the economy began a healthy rebound
and the real estate market saw the completion and commencement of new projects in
the major markets. The exchange rate hovered at about 12 pesos to the U.S. dollar
throughout 2010. The demand for maquiladora product continued to increase in
response to increasing labor and transport costs from Asian operations, while some
Asian companies installed manufacturing operations in northern Mexico. Real estate
activity rebounded in major markets with Mexico City faring the best. The office and the
industrial sectors experienced positive and strengthening absorption, despite the negative
news drug trafficking violence. Leasing and sales demand is expected to increase sharply
in almost all asset classes. Lease rates in Mexico City for all product types have been
stable, but there will be slight upward pressure in 2011. Sale prices across the country
should be relatively stable as the recovery solidifies. Cap rates are expected to drop to
about 9% for quality product, with target IRRs in the 15-20% range.

Panama.
Panama saw continued GDP growth (above 5%) in 2010. For 2011, the country’s growth
rate is expected to attain 6.3%. Real estate development continued strongly,
primarily in the residential, office and industrial sectors. Absorption for all product
types remained active, and lease and sale prices for commercial properties were stable.
Going forward, the supply of both office and industrial properties is expected to expand
significantly, with the office market expecting the largest jump in new product. Over the
next 18 months, an additional 357,300 square meters will be added to the market
inventory as projects currently under construction are completed. This amount represents
a doubling of supply. Despite this, we do not expect any significant decrease in
office lease rates in 2011, due to pent-up demand and the timing of product deliveries.
However, 2012 will witness downward pressure on rental rates.
Venezuela.
2010 proved to be yet another difficult year for Venezuela, as the Chavez administration’s
macro and microeconomic policies continued to punish markets. Additionally, declining
oil production and prices reduced government revenues from its most important and
profitable economic engine. We expect 2011 will be another difficult year, with shortages
expected in many sectors due to the administration’s nationalization of numerous
companies and its continued threats to strategic industries, such as food processing and
agriculture. Except for activity with political bedfellows such as Iran, China, Libya and
Russia, there is virtually no new foreign investment in Venezuela outside of the petroleum
industry. Unfortunately, the country’s administration and policy environment will cripple
any chance of a recovery. Vacancy rates are still near zero in the office, industrial,
and retail sectors, while rental rates are rising sharply in local currency terms (due to high
inflation rates and artificially low U.S. Dollar-to-Bolivar exchange rates. Although investors
and developers remain very cautious due to the lack of transparency and political risks,
there is some new development and investment in real estate.

n US Highlights – Northeast Region
n Connecticut New Jersey Leading Price Class A Markets
Delaware New York
Maine Pennsylvania
Maryland Northern Virginia Market Effective Avg. High Rent Vacancy
Downtown Office
Massachusetts Washington, DC New York City-Midtown $ 55.60 $ 74.00 12.5%
Class A
New Hampshire Washington, DC $ 53.50 $ 80.00 12.8%
Boston, Massachusetts $ 42.00 $ 44.00 11.7%
New York City-Downtown $ 41.23 $ 49.00 12.5%
Wilmington, Delaware $ 26.00 $ 29.00 20.0%
Market Effective Avg. High Rent Vacancy
Office
SuburbanOffice
Office Westchester, New York $ 32.34 $ 33.00 14.0%
ClassAA
Northern Virginia $ 55.00 $ 32.00 14.0%
Baltimore’s CBD continues to suffer with a vacancy rate slightly higher than it was in 2009. Among
Class
Suburban
Suburban Maryland/DC Suburbs $ 29.28 $ 50.50 16.0%
the market’s many challenges: nearly $2 billion of commercial properties that have been foreclosed
Northern New Jersey $ 29.00 $ 46.00 13.6%
or are carrying significant maturing debt, up from $1.8 billion in 2009.
Princeton/Mercer County, New Jersey $ 28.50 $ 32.00 13.0%
Downward velocity in the Boston office market appears to be slowing. Vacancy increased to 14.1% Bucks County, Pennsylvania $ 26.00 $ 30.00 16.0%
and Class A rents decreased to $32/SF in 2010, but the changes were less profound than in 2009.
The Manhattan office market was on an upward trend throughout 2010. The recovery to date has Leading Price Retail Markets
been atypical, as law firms, media and marketing industries take advantage of availabilities and
pricing in quality space. Financial institutions, which generally take the bulk of the space, are doing
so on a lesser scale.
Office
New York City-Midtown $ 135.00 $2,000.00 4.1%
Downtown
Downtown
In Northern Virginia, vacancy rates fell across all building types and the market saw its first spec-
Retail
Washington, DC $ 55.00 $ 80.00 2.5%
A
Retail
Downtown
Class
ulative construction project in two years. With less new supply delivering, coupled with continued Westchester, New York $ 49.88 $ 75.00 15.0%
GSA leasing, vacancy rates are expected to drop further. Investment sales transaction volume is up Boston, Massachusetts $ 42.00 $ 54.00 3.6%
throughout the region, with total sales volume increasing more than 46% in 2010 vs. 2009. Philadelphia, Pennsylvania $ 35.00 $ 75.00 10.0%
The nation's capital, Washington, DC, is also its strongest commercial real estate market.
It continues its track to recovery propelled by federal government activity in 2010. Vacancy rates Market Effective Avg. High Rent Vacancy
Centers
ClassCenters
Office
saw a small reduction after a decisive uptick in demand coincided with the continued thinning of Westchester, New York $ 35.63 $ 40.00 15.0%
Washington, DC $ 30.00 $ 45.00 3.0%
Retail
the development pipeline.

Retail
A
Suburban
Berks County, Pennsylvania $ 24.50 $30.00 12.0%

Service
Service

Industrial Baltimore, Maryland $ 23.00 $ 50.00 N/A
The Boston industrial market has been slowed by the recession, but has not seen the dramatic
rise in vacancy experienced in the office market. The average rent remains in the mid to high
Centers

$5/SF range and overall vacancy is around 10.3%.
Centers
Westchester, New York $ 38.00 $ 45.00 10.0%

Retail
The Northern New Jersey industrial market was hit hard by the recession but is recovering and
Retail

Power
has seen new absorption. Vacancies remain at historical highs, 8.5-9%, yet a continued demand
Power
Philadelphia, Pennsylvania $ 27.00 $ 38.00 12.0%

for flex and R&D space keeps the market vibrant. Even with an abundance of space, it is difficult Greater Springfield (Western ), Massachusetts $ 25.00 $ 30.00 10.0%
to find modern, high-ceiling warehouses with large spaces. Southern New Jersey $ 22.00 $ 38.00 8.0%
Philadelphia continues to receive interest on a global basis as heavy manufacturing, high-tech,
MallsMalls
drug and alternative energy companies seek labor, power, rail, port and economic incentives Market Effective Avg. High Rent Vacancy
RetailRetail
offered specifically within The Philadelphia Naval Yard and other industrial sites under the control Long Island, New York $ 90.00 $ 120.00 5.0%
Regional
of the Philadelphia Industrial Development Corporation. Westchester, New York $ 78.38 $ 90.00 10.0%
Regional
The industrial market in Westchester is flat. Prices have dropped, but the amount of vacant space Washington, DC $ 62.00 $ 90.00 4.0%
continues to rise and there do not appear to be many tenants looking. Wilmington, Delaware $ 55.00 $ 75.00 6.0%
Middlesex/Somerset Counties, New Jersey $ 50.00 $ 60.00 16.0%
Retail
The Baltimore retail market did not experience much change in market conditions from 2009 to Leading Price Industrial Markets
2010. A total of 1.2 million SF of retail was under construction at the end of Q3 2010.
Warehouse
The retail sector in Northern New Jersey has been most impacted by the economic crisis. Tenants
Industrial
Warehouse
seek to restructure leases while landlords manage each situation independently. Vacancy rates have
Washington, DC $ 9.00 $ 16.50 12.8%
Industrial
leveled off yet remain high at 8-9%. The larger malls remain leased and are doing well.
BulkBulk
The retail market in Northern Virginia has held its own, but rents generally remain flat to declining. Westchester, New York $ 8.00 $ 14.00 10.7%
One of the largest sale transactions in 2010 was Plaza America in Reston. This 222,692 SF retail Suburban Maryland/DC Suburbs $ 7.11 $ 22.00 13.0%
center sold for $49 million, or $220.03/SF. Northern New Jersey $ 6.25 $ 7.00 10.0%
Philadelphia retail activity was a mixed bag in 2010. The Sugar House Casino opened in
Manufacturing
Industrial
September and retail demand continues at a fair pace for well-located opportunities, but rental Market Effective Avg. High Rent Vacancy
Manufacturing
rates continue to decline throughout the market and tenant concessions remain the catalyst for Westchester, New York $ 8.00 $ 12.00 10.7%
Industrial
getting deals done. Suburban Maryland/DC Suburbs $ 7.76 $ 10.00 7.0%

Boston, Massachusetts $ 6.00 $ 8.50 N/A
The slight overall dip in rental rates experienced nationally was not as dramatic in the Washington,
Northern New Jersey $ 5.25 $ 6.50 12.0%
DC, region. New York-based restaurant operators saw opportunity in the DC market and targeted
Albany, New York $ 5.15 $ 6.50 N/A
high-traffic venues around Verizon Center in Chinatown. Buildings in Dupont Circle never
previously considered for restaurant uses were re-fitted to support venting configurations.
Industrial
Flex
The biggest change in the Westchester retail market has been the increased amount of retail Market Effective Avg. High Rent Vacancy
High Tech/R&D
space available for lease. While there has been substantial absorption, this is due primarily to Princeton/Mercer County, New Jersey $ 24.00 $ 30.00 15.0%
Industrial
several supermarkets (ShopRite, Fairway, Stop & Shop) and Walgreen's taking some of the bigger Washington, DC $ 14.50 $ 16.00 11.6%
spaces. Smaller "mom & pop' shops continue to struggle Wilmington, Delaware $ 14.00 $ 20.00 18.0%
Westchester, New York $ 11.30 $ 27.00 15.0%

n US Highlights – Southeast Region
n Alabama North Carolina Leading Price Class A Markets
Florida South Carolina
Georgia Tennessee
Kentucky Market Effective Avg. High Rent Vacancy
Downtown Office
Mississippi Miami, Florida $ 36.59 $ 44.82 21.8%
Class A
Palm Beach County, Florida $ 28.50 $ 45.00 24.0%
Tampa Bay, Florida $ 28.00 $ 32.00 15.0%
Charlotte, North Carolina $ 26.00 $ 28.00 12.5%
Office Charleston, South Carolina $ 24.50 27.00 9.3%
Atlanta’s office market has begun to gradually rebound from the recession. Leasing activity has
increased, but this activity is dominated by consolidation and downsizing, so the activity does not Market Effective Avg. High Rent Vacancy
Suburban Office
translate to lower vacancy. Vacancy rates are averaging 20.3% and tenants are benefiting from Palm Beach County, Florida $ 32.00 $ 47.00 22.0%
Class A
aggressive concession packages and reduced rental rates. Miami, Florida $ 28.73 $ 44.00 20.2%
The Birmingham office market racked up 490,044 SF of negative absorption in 2010. The overall
Memphis, Tennessee $ 23.44 $ 27.50 11.0%
occupancy fell 3% to 90.5%.
Asheville, North Carolina $ 23.40 $ 26.00 20.0%
Over the last 18 months, four new buildings totaling 2.85 million SF were delivered in the
Charlotte CBD. Despite fear that vacancies would rise with the new deliveries, the overall vacancy
rate of 12.1% is near a historic low.
Leading Price Retail Markets
A number of Jacksonville’s major office tenants relocated to the suburbs in 2010, leaving abundant
space available in the city’s urban core. However, aided by the resurgence in suburban leasing activity,
2010 overall office vacancy rates declined to 15.5%.
Miami, Florida $ 37.30 $ 47.50 5.5%
Downtown
The office sector in Miami is divergent. The CBD, Brickell and other submarkets are witnessing
Retail
Charleston, South Carolina $ 36.00 $ 44.00 11.0%
vacancy rates of 20% or more. Most large tenants have relocated or renegotiated favorable terms Orlando, Florida $ 28.00 $ 32.00 14.4%
in premier buildings. Rental rates in weakened submarkets will continue to fall at a mitigating Charlotte, North Carolina $ 27.25 $ 35.00 16.1%
pace, while healthy submarkets should stabilize. Palm Beach County, Florida $ 25.00 $ 40.00 15.0%
The number of sale transactions in Orlando has increased, but the average price per SF has
declined and cap rates have averaged 8.8%. Market Effective Avg. High Rent Vacancy
Service Centers Miami, Florida $ 21.32 $ 59.95 8.7%
Industrial Palm Beach County, Florida $ 20.00 $ 33.00 13.0%
Retail
Mobile/Baldwin Counties, Alabama $ 18.75 $ 27.50 10.0%

There has been a noticeable increase in total leasing and sales activity in Atlanta and a decrease Chattanooga, Tennessee $ 18.00 $ 20.00 10.0%
in the amount of negative net absorption over the last several years. With over 2.6 million SF of Greensboro/High Point/Winston-Salem, North Carolina $ 18.00 $ 20.00 20.0%
deliveries during the first nine months of 2010, vacancy rates remain elevated at 14% and rental
rates have decreased slightly from this time last year. Market Effective Avg. High Rent Vacancy
Power Centers
Jacksonville is the second-busiest port for automobiles in the nation, and just fewer than 519,000 Miami, Florida $ 24.73 $ 49.18 6.6%
Retail
automobile units went through Jacksonville in 2010, which represented a 24% year-over-year increase. Chattanooga, Tennessee $ 24.00 $ 30.00 10.0%
The Memphis industrial market enjoyed a strong 2010. Large spaces have been filled through Louisville, Kentucky $ 21.35 $ 28.00 10.4%
leasing activity, principally in the Southeast Memphis and DeSoto County submarkets. Palm Beach County, Florida $ 20.50 $ 25.00 14.0%
Miami’s industrial markets are improving with large blocks absorbed, including a 342,000 SF
transaction. As global economies improve, so will local markets. Miami’s largest trading partner, Market Effective Avg. High Rent Vacancy
Regional Malls
Chattanooga, Tennessee $ 37.00 $ 50.00 10.0%

Brazil, is experiencing strong growth, which bodes well for exports.
Charleston, South Carolina $ 36.00 $ 46.00 4.0%
Retail
The overall Orlando industrial vacancy rate stands at 12.8%. Net absorption has been positive Savannah, Georgia $ 35.00 $ 50.00 2.5%
and vacant sublease space continues to decrease as well. However, lease rates have yet to recover Columbia, South Carolina $ 35.00 $ 45.00 17.1%
and are down from 2009. Greenville/Spartanburg/Anderson Counties, $ 35.00 $ 40.00 2.0%
The Tampa industrial market suffers from an abundance of functionally obsolete product with low South Carolina
ceilings and fixed interior components. New flex space in the I-4 corridor is the hot new market
with several large facilities currently under construction.
Leading Price Industrial Markets
Retail Market Effective Avg. High Rent Vacancy

Bulk Warehouse
Miami, Florida $ 6.80 $ 11.39 9.3%

Industrial
The Atlanta retail market will continue to adjust itself with some vacant centers that were ill-
conceived. Vacancy rates are high in many areas (±15%) and rent adjustments downward
continue to press landlords. Tenant choices have never been better.
Orlando, Florida $ 4.50 $ 6.50 13.5%
In Charlotte, several grocery-anchored centers traded at impressive levels as investors sought Jacksonville, Florida $ 4.32 $ 6.05 10.2%
core assets with stable returns. There was a substantial increase in single-tenant deals, banks,
auto and drug stores. Market Effective Avg. High Rent Vacancy
Manufacturing
The retail sector in Knoxville has been depressed with high vacancy rates and tenants seeking Palm Beach County, Florida $ 6.00 $ 7.50 11.3%
Industrial
rent reductions. Prime locations continue to lease but with free rent and increased tenant Tampa Bay, Florida $ 5.50 $ 7.50 25.0%
improvement contributions from the landlord. National credit tenants are being replaced in many Birmingham, Alabama $ 4.50 $ 6.50 15.0%
instances by local tenants as a temporary relief from existing vacancy. Asheville, North Carolina $ 4.50 $ 6.00 15.0%
Retail demand is rebounding in Miami as consumer spending picks up. Despite store closings, Savannah, Georgia $ 4.50 $ 4.50
supply is in balance because of barriers to entry. REITs are purchasing quality retail assets now
priced at higher cap rates. Market Effective Avg. High Rent Vacancy
High Tech/R&D
Retail vacancies are expected to improve in Orlando as the wave of store and restaurant closings Orlando, Florida $ 30.00 $ 30.00 5.2%
Industrial
subsides. New restaurant chains are entering the market and dollar stores continue to thrive and Mobile, Alabama $ 17.50 $ 20.00 10.0%
expand. Quoted lease rates are trending lower in the near-term. Knoxville, Tennessee $ 15.00 $ 21.00 6.0%
Miami, Florida $ 11.61 $ 20.10 8.8%
Birmingham, Alabama $ 10.20 $ 12.50 8.0%

n US Highlights – Midwest Region
n Illinois Nebraska Leading Price Class A Markets
Indiana North Dakota
Iowa Ohio
Michigan South Dakota Market Effective Avg. High Rent Vacancy
Downtown Office
Minnesota Wisconsin Miami, Florida $ 36.59 $ 44.82 21.8%
Class A
Missouri Palm Beach County, Florida $ 28.50 $ 45.00 24.0%
Office Charleston, South Carolina $ 24.50 $ 27.00 9.3%
The downtown Chicago office vacancy rate has been on the rise for the past two years, but finally
leveled off around 17% during the second half of 2010. Downtown construction has ground to a Market Effective Avg. High Rent Vacancy
Suburban Office
halt in 2010, following the delivery of 3.6 million SF in 2009. Suburban vacancy rates, typically Palm Beach County, Florida $ 32.00 $ 47.00 22.0%
Class A
higher and more volatile than that downtown, continued to climb through 2010, and neared 24% Miami, Florida $ 28.73 $ 44.00 20.2%
at year’s end. Tampa Bay, Florida $ 28.00 $ 32.00 15.0%
Total office vacancy in Cleveland was about 20%, with vacancy in Class A space around 11%. Memphis, Tennessee $ 23.44 $ 27.50 11.0%
The next few years will be critical as two highly anticipated public/private developments in the Asheville, North Carolina $ 23.40 $ 26.00 20.0%
CBD move off the drawing board: a medical mart and convention center, expected to be completed
in 2012; and a new casino, expected to be completed in 2013.
The Kansas City office market improved modestly during 2010 with overall vacancy decreasing
1% to 18.8% and Class A vacancy decreasing 3.5% to 17%. Competitive rates and incentive
packages spurred many tenants to seek higher quality projects. Private employment levels need Market Effective Avg. High Rent Vacancy
to increase for sustained improvement. Miami, Florida $ 37.30 $ 47.50 5.5%
Downtown
Retail
The Twin Cities of Minneapolis and St. Paul have one of the most diverse economies in the U.S., Charleston, South Carolina $ 36.00 $ 44.00 11.0%
Orlando, Florida $ 28.00 $ 32.00 14.4%
with more than 90% of all major industries represented and more Fortune 500 headquarters
than any other state. Rental rates held steady in 2010 with vacancy rates stable at 10%.
Palm Beach County, Florida $25.00 $ 40.00 15.0%
The St. Louis office market experienced moderate growth with significant gains reported by year’s
end. Rental rates are on the decline as tenants continue to seek and gain landlord concessions. Market Effective Avg. High Rent Vacancy
Service Centers Miami, Florida $ 21.32 $ 59.95 8.7%
Industrial Palm Beach County, Florida $ 20.00 $ 33.00 13.0%
Retail
The second largest industrial market and the most important transportation hub in the U.S., Mobile/Baldwin Counties, Alabama $ 18.75 $ 27.50 10.0%
Chicago continued to be challenged during 2010 by limited demand and an uncertain economy. Chattanooga, Tennessee $ 18.00 $ 20.00 10.0%
Greensboro/High Point/Winston-Salem, North Carolina $ 18.00 $ 20.00 20.0%
Vacancy rates peaked above 12%, but improved for the first time in two years during the second
half of the year.
Cleveland industrial stabilized with static vacancy, firming rents and a positive leasing velocity. Market Effective Avg. High Rent Vacancy
Power Centers
These factors were well balanced by a lack of new development, due to an overall tentativeness Miami, Florida $ 24.73 $ 49.18 6.6%
Retail
among businesses coupled with a continued lack of liquidity within the lending market. Chattanooga, Tennessee $ 24.00 $ 30.00 10.0%
For the first time since the beginning of 2008, Detroit’s industrial market has shown positive
Louisville, Kentucky $ 21.35 $ 28.00 10.4%
net absorption (1 million SF), furthering the case that stability has returned. Large investments
in alternative energy and “green” engineering have recently shown increased velocity with the
signing of A123 Systems, the largest lithium ion battery plant in the world.
Regional Malls
St. Louis recorded modest gains in net absorption at the end of 2010 after neutral results earlier Chattanooga, Tennessee $ 37.00 $ 50.00 10.0%
in the year. This was aided by historically low deliveries. Several large leases were signed, Charleston, South Carolina $ 36.00 $ 46.00 4.0%
Retail
although the main activity tended to center around lease renewals rather than new tenants. Savannah, Georgia $ 35.00 $ 50.00 2.5%
Columbia, South Carolina $ 35.00 $ 45.00 17.1%
Retail Greenville/Spartanburg/Anderson Counties, $ 35.00 $ 40.00 2.0%
South Carolina
Cleveland’s retail segment remained behind the pace set by the industrial and office segments.
However, the string of retail tenant bankruptcies dramatically slowed as the segment began to
reposition towards a much-anticipated recovery. Leading Price Industrial Markets
Milwaukee has seen an up-tick in retail leasing. Lease rates have dropped since 2009 but have
leveled out as vacancy has decreased over the past 12 months. Retailers have shown optimism Market Effective Avg. High Rent Vacancy
Bulk Warehouse
for 2011-2012 expansion. Miami, Florida $ 6.80 $ 11.39 9.3%

Industrial
Activity and new lease signings have increased across the board in the Twin Cities of Minneapolis/ Palm Beach County, Florida $ 5.25 $ 7.00 10.8%
St. Paul. Today there is less emphasis on cost and more focus on consumer demand. Gordman’s Tampa Bay, Florida $ 5.25 $ 6.50 30.0%
will be making its debut in the Twin Cities market with three locations, while Herberger’s, Aldi, Orlando, Florida $ 4.50 $ 6.50 13.5%
Staples, Wal-Mart, Big Lots, T-Mobile, Little Caesars Pizza, Jersey Mike’s and Baja Sol look to Jacksonville, Florida $ 4.32 $ 6.05 10.2%
add additional locations.
Omaha has seen an increase in retail activity, especially national tenants who specialize in the
Manufacturing

Industrial
discount sector. However, there is very little activity with big box, anchor and junior anchor sites. Tampa Bay, Florida $ 5.50 $ 7.50 25.0%
Landlords are working hard to retain retail tenants at the end of lease terms. Birmingham, Alabama $ 4.50 $ 6.50 15.0%
Asheville, North Carolina $ 4.50 $ 6.00 15.0%
Savannah, Georgia $ 4.50 $ 4.50

High Tech/R&D
Orlando, Florida $ 30.00 $ 30.00 5.2%

Industrial
Mobile, Alabama $ 17.50 $ 20.00 10.0%

Knoxville, Tennessee $ 15.00 $ 21.00 6.0%
Miami, Florida $ 11.61 $ 20.10 8.8%
Birmingham, Alabama $ 10.20 $ 12.50 8.0%

n US Highlights – Southwest Region
n Arkansas Oklahoma Leading Price Class A Markets
Kansas Texas
Louisiana
Downtown Office
Houston, Texas $ 36.25 $ 42.96 8.0%
Class A
Austin, Texas $ 35.50 $ 46.00 17.0%
Office Fort Worth, Texas $ 23.00 $ 27.00 15.0%
For the first time since 2005, citywide occupancies fell below 84% in Baton Rouge in 2010, Baton Rouge, Louisiana $ 22.58 $ 23.00 12.0%
which is 4% lower than the prior year. A glut of sublease space and motivated landlords have San Antonio, Texas $ 22.00 $ 25.00 12.0%
made the office sector very tenant friendly, although a recent increase in medical office and
general office activity may show early signs of private sector growth. Market Effective Avg. High Rent Vacancy
Suburban Office
In Dallas/Ft. Worth, supply exceeds current demand, making it a “tenants’” market as we play Houston, Texas $ 27.64 $ 43.99 18.0%
Class A
“catch up” from flat or negative absorption in recent years. Office vacancy stands at 20%. We Austin, Texas $ 26.75 $ 33.00 29.0%
are seeing a marked increase in absorption and foresee occupancy rates rising significantly in New Orleans, Louisiana $ 22.33 $ 24.00 9.4%
2011 as companies make longer commitments and take advantage of the depressed rental rates. Dallas, Texas $ 22.00 $ 30.00 19.6%
San Antonio, Texas $ 22.00 $ 24.00 15.0%
Houston’s emphasis on international trade is expanding and is a prominent theme in the city’s
continued economic development. Houston’s office vacancy rate across all classes was 14.2%
in 2010 and a low 12.5% in the CBD.
The New Orleans office market remains resilient and stable, with downtown Class A office
occupancy near 89% at rates of $17-$20/SF. Occupancy in the suburban market is at 90.6%,
with rates of $22-24/SF. Market Effective Avg. High Rent Vacancy
Houston, Texas $ 36.20 $ 50.00 30.0%
Downtown
San Antonio office properties approached year-end 2010 with a vacancy rate of 18.6%, down
Retail
Austin, Texas $ 26.50 $ 41.00 5.0%
slightly from 2009. Likewise, rental rates remained relatively stable at $20.54/SF on a full-service
basis, up $0.13 from the same time a year earlier.
Fort Worth, Texas $ 18.75 $ 38.00 1.4%
New Orleans, Louisiana $ 16.86 $ 40.00 20.0%
Industrial
With overall vacancy still over 20%, there is still ample first-generation space available to in Market Effective Avg. High Rent Vacancy
Austin. Rental rates, which have fallen 30-35% from the high reached in late 2007, have begun Service Centers Dallas, Texas $ 32.50 $ 60.00 10.0%
McAllen/Mission, Texas $ 21.00 $ 27.00 2.0%
Retail
to level out but it remains a tenants’ market heading into 2011.

Industrial vacancy stands at 12.5% in Dallas, several points above the national average. Tenants
Corpus Christi, Texas $ 19.00 $ 28.00 14.0%
will continue to have the upper hand through the end of 2011, but as quality space continues to
get absorbed we could see speculative industrial starts by the end of 2011.
There was almost 6.4 million SF of warehouse space available in New Orleans at the end of
2010, which is a sign that the demand of the post-Hurricane Katrina 2006 boom has abated.
Power Centers

The Oklahoma City industrial market remains strong with overall vacancy at 8.3% in 2010, up
Retail
Baton Rouge, Louisiana $ 26.00 $ 34.00 5.0%

0.1% for the year. Rates remain stable with flex space at $6.80/SF, up from $6.40 at the beginning San Antonio, Texas $ 24.00 $ 28.00 15.0%
of 2010, and bulk warehouse space averaging $3.67/SF, up from $3.63 at the beginning Houston, Texas $ 22.22 $ 35.50 10.0%
of 2010. Austin, Texas $ 22.00 $ 30.00 10.0%
Retail Market Effective Avg. High Rent Vacancy

Regional Malls

The Austin retail market continues to experience a healthy retail environment, which has helped
Dallas, Texas $ 45.00 $ 60.00 10.0%
Retail
fill large vacancies. The restaurant market also remains active with expanding concepts as well
as new entries like Maggiano's Little Italy, Qdoba, Cafe Express and Los Cucos
Baton Rouge, Louisiana $ 35.00 $ 80.00 N/A
The Fort Worth retail market can expect to see a stabilized vacancy factor by Q1 2011 based on Jonesboro, Arkansas $ 25.00 $ 32.00 10.0%
leasing activity in the last two quarters of 2010. The retail market is showing signs of improvement,
although the viral effects of a national economic downturn hinder a breakout of positive rent
growth.
Leading Price Industrial Markets
Houston’s retail market experienced a decrease in vacancy to 7.6% overall. The average quoted
asking rent dropped 2.9% to $14.55/SF. However, sales prices have risen about $10/SF over the
past 12 months. The Galleria, a landmark Houston retail property, sold in June 2010 for
Bulk Warehouse

$570.65/SF.
Industrial
Austin, Texas $ 5.80 $ 6.60 21.0%

The New Orleans retail market has been caught in the downturn being experienced nationally, Houston, Texas $ 5.31 $ 7.14 5.0%
but there are more than a few national tenants shopping around for space. Dick's Sporting Goods Corpus Christi, Texas $ 4.80 $ 6.00 4.0%
and Kohl's Department Stores recently announced their first area stores Baton Rouge, Louisiana $ 4.00 $ 5.15 14.0%

Manufacturing
Oklahoma City, Oklahoma $ 5.75 $ 9.25 14.0%

Industrial
Austin, Texas $ 5.70 $ 7.20 20.0%

Houston, Texas $ 5.17 $ 7.80 3.0%
Wichita, Kansas $ 4.25 $ 5.00 10.0%

High Tech/R&D

Industrial

Corpus Christi, Texas $ 9.00 $ 12.00 6.0%
Austin, Texas $ 8.90 $ 10.20 22.4%
Fort Worth, Texas $ 8.50 $ 12.00 11.4%

n US Highlights – West Region
n Arizona Nevada Leading Price Class A Markets
California New Mexico
Colorado Oregon Market Effective Avg. High Rent Vacancy
Downtown Office
Hawaii Utah Honolulu, Hawaii $ 35.16 $ 35.52 12.0%
Class A
Idaho Washington Los Angeles County, California $ 32.31 $ 42.00 15.5%
Montana Wyoming Portland, Oregon $ 29.00 $ 35.00 8.2%
San Diego, California $ 29.00 $ 30.60 18.0%
San Francisco, California $ 28.36 $ 55.00 15.0%
Office
Supply and demand is generally in balance in Denver. The vacancy rate decreased slightly from Market Effective Avg. High Rent Vacancy
Suburban Office
14.8% in 2009 to 14.5% in 2010 and with four continuous quarters of positive absorption, more Los Angeles County, California $ 36.89 $ 71.40 17.3%
Class A
than 1.8 million SF was absorbed in the last year. San Francisco, California $ 32.11 $ 141.50 19.4%
Vacancy rates for new office space in Los Angeles remain stubbornly high, above 30% county-
Ventura County, California $ 29.33 $ 38.22 19.6%
wide. Class A vacancy rates are about half that for new space but still high by historical standards.
Orange County, California $ 26.10 $ 54.00 20.5%
Rental rates are still declining as evidenced by the $2.00/SF decline for Class A space. Rental
rates for Class B space have fallen, but not by much.
Portland’s suburban office market struggled in 2010, with decreasing rental rates and increasing Leading Price Retail Markets
vacancy, but Central City remains fairly healthy, especially for Class A space.
Improved activity in the San Diego office market resulted in a decrease in the countywide vacancy
rate to 15.3% in 2010. Average rents declined by 1.7% from 2009 to $25.99/SF.
Honolulu, Hawaii $ 115.98 $ 180.00 6.0%
Downtown
A growing tech sector helped offset losses in San Francisco’s banking, legal and financial sectors,
Retail
and the market was further aided by an empty pipeline of new construction. With tenants sensing Seattle/Puget Sound, Washington $ 40.00 $ 60.00 6.5%
a bottoming, several large lease signings took place in 2010 as major tenants moved to lock in Jackson Hole, Wyoming $ 32.00 $ 50.00 5.0%
rates that are about 30% below the 2007 peak. San Diego, California $ 31.80 $ 66.00 5.0%
Seattle continues to attract high tech, aerospace, international trade, manufacturing and other
companies on the cutting edge of innovation. Amazon is moving into 2.1 million SF of space and Market Effective Avg. High Rent Vacancy
the Gates Foundation is moving into its new 1.3 million SF headquarters. Service Centers Honolulu, Hawaii $ 41.16 $ 46.68 2.7%
Seattle/Puget Sound, Washington $ 26.00 $ 35.00 8.0%
Retail
Jackson Hole, Wyoming $ 25.00 $ 30.00 10.0%

Industrial Los Angeles County, California $ 24.55 $ 165.00 7.2%
The direct vacancy rate in Denver’s industrial market declined to the lowest level reported since San Diego, California $ 24.24 $ 60.00 8.0%
Q4 2007. However, lease rates remain soft and are likely to move very little until employment
growth strengthens leasing activity.
Power Centers
Los Angeles industrial vacancy rates have fallen to approximately 8.6%. The R&D segment has Honolulu, Hawaii $ 49.02 $ 54.36 4.8%
the highest vacancy rates at 9.0%. Rental rates continue to soften across the board. Rental rates
Retail

for industrial space are in the low to mid $6.00/SF range. Colorado Springs, Colorado $ 25.00 $ 33.00 8.0%
Portland’s industrial market is stable with vacancy leveling off. The city’s robust cluster of San Diego, California $ 24.93 $ 42.00 7.0%
renewable energy companies, such as solar panel manufacturers, is attracting more of these Los Angeles County, California $ 23.88 $ 198.00 8.0%
businesses that require industrial space to the area.
Salt Lake City is a key distribution hub with over 109 million SF of industrial space. Total Market Effective Avg. High Rent Vacancy
Regional Malls
availability in the industrial market declined to 7.83% in 2010 after reaching nearly 10% in 2009. Albuquerque, New Mexico $ 42.00 $ 50.00 21.1%
Honolulu, Hawaii $ 41.82 $ 51.48 8.5%
Retail
Industrial has been one of the strongest sectors and the aggregate square footage leased in
2010 will eclipse 2009 levels by more than 11%. San Francisco, California $ 40.00 $ 100.00 5.0%
Seattle/Puget Sound, Washington $ 38.00 $ 70.00 5.6%
Overall industrial vacancy in Seattle is 8.5%, high for the region, but comparatively strong
Phoenix, Arizona $ 32.50 $ 40.00 10.0%
nationally. This rate will drop as port traffic increases and Boeing begins hiring in 2011.
Retail Leading Price Industrial Markets

The retail market in Denver experienced a slight improvement in market conditions in 2010. The
vacancy rate went from 7.0% in 2009 to 6.1% in 2010 and net absorption was 828,591 SF
Bulk Warehouse
in the last year. Much of this positive movement was driven by a 14.8% reduction in quoted
Honolulu, Hawaii $ 11.27 $ 11.65 4.8%
Industrial
rental rates.
Hawaii’s hospitality and retail trade sectors are benefiting from the sharp declines in the value San Diego, California $ 8.04 $ 48.84 9.0%
of the U.S. dollar. New hospitality and retail related venues are being planned by national and Ventura County, California $ 7.12 $ 15.00 8.8%
international retailers such as Forever 21, Sephora, Victoria’s Secret, Tommy Bahama and Ross. Jackson Hole, Wyoming $ 7.00 $ 8.00 10.0%
Local retailers continue to be an important segment of Las Vegas’ recovery with tenants taking
advantage of the historically low rates. Positive net absorption of 47,200 SF through midyear Market Effective Avg. High Rent Vacancy
Manufacturing
2010 has been a positive indicator for retail. Honolulu, Hawaii $ 24.48 $ 12.60 6.5%
Industrial
Phoenix, Arizona $ 9.50 $ 16.00 12.0%

Malls and community centers in Los Angeles experienced a small but positive $.04/SF increase
in rents. Discount retailers and quick-service restaurants are the most active in the market. Outlet
Jackson Hole, Wyoming $ 8.00 $ 10.00 10.0%
malls also experienced strong tenant interest. Vacancy rates in those centers are very low and
Las Vegas, Nevada $ 7.56 $ 11.88 14.3%
rental rates are still very strong.
Although the closure of Saks Fifth Avenue was a blow to downtown Portland, retail vacancy
overall has dipped below 7% and Pioneer Place, H&M, Fifth Avenue Off Fifth and Nordstrom Rack Market Effective Avg. High Rent Vacancy
High Tech/R&D
announced new stores in Portland’s suburbs. San Diego, California $ 56.00 $ 42.00 17.0%
Industrial

The San Diego retail market experienced little change in 2010. The market closed Q3 with a
Honolulu, Hawaii $ 12.78 $ 13.20 3.8%
vacancy rate of 5.4% and average asking rents of $22.39/SF. Cap rates increased from 7.6% in
Phoenix, Arizona $ 11.50 $ 18.00 18.0%
2009 to 8.27% in 2010.
Denver, Colorado $ 10.71 $ 16.00 15.0%

Asia Pacific
SECTION CONTENTS
Adelaide, Australia Kolkata, India
Brisbane, Australia Pune, India
Melbourne, Australia Punjab, India
Perth, Australia Tokyo, Japan
Sydney, Australia Kuala Lumpur, Malaysia
Beijing, China Auckland, New Zealand
Hong Kong, China Christchurch, New Zealand
Shanghai, China Wellington, New Zealand
Guam Singapore
Chennai, India Seoul, South Korea
Delhi, Gurgaon, India Taipei, Taiwan

Adelaide, Australia Brisbane, Australia
Since the Federal Government’s announcement of the Mining The Queensland economy demonstrated uneven growth
Super Tax in June 2010 and the election that followed, there through 2010 with rising interest rates and political events
has been a degree of uncertainty across all markets. The punctuating any potential positive trends, particularly in the
market expects an interest rate increase of up to 1% over the middle of the year. Business sentiment and retail spending
next 12 months. The bank sector, with limited funds to lend, has been mixed. There is a belief within the business sector
is being selective. Adelaide with a solid defense, mining and that economic growth will return in the next 12 months. IT
agriculture based economy continues to grow and we expect and professional services sector employment has been
recovery over the next 12 month. weak. However, the natural resources and government
The current market conditions reflect the fact that the sectors have held up employment levels.
Australian economy appears to be fending off any direct After a record 195,000 SM was added to total office stock
impact from the continuing weakness in the U.S. and Europe. in 2009, a further 38,000 SM has been added in 2010,
There is solid demand for investment properties leased to much of which is pre-committed. In 2011 a further 125,000
proven tenants, and lenders are comfortable with providing SM is to be added with a large amount of this new
funding for properties which offer secure cash flow. stock already pre-committed. Tenants that have made
The CBD office leasing market is in good shape with histori- pre-commitments include Rio Tinto, Bentleys, CUA, Grant
cally low vacancies and no new buildings being developed Thornton and GHD.
Contact Contact
without a substantial pre-commitment. The current vacancy Office vacancy levels in the CBD are at 10.9%, below the
NAI Harcourts NAI Harcourts Brisbane
of approximately 7% is not expected to increase over the 11.3% rate seen at the beginning of the year. With new
Brock Commercial +61 7 3839 3100
short to medium term. Limited new office supply over the supply next year it is anticipated vacancy rates will be close
+61 8 8203 1399
medium term and positive absorption is expected, although to 12% before reducing thereafter. Accordingly, there has
take-up will be low due to limited supply. Incentives been little change to office rents in 2010 and no significant
are expected to remain in the region of 5-10% during the change to rents or incentives in the market is expected
forecast period. Vacancy is expected to remain above 4% in 2011.
until at least 2012. Investment activity in the Brisbane CBD has been cautious
The sublease market has grown but with low vacancies the during 2010 with few large transactions occurring. Two of
quality end of the market has leased up well. Record rental the more significant purchases have come from Asia with
Country Data prices were achieved in the recent sublease of 3,000 SM at Country Data K-REIT Asia picking up a 50% share of 275 George Street
the Ernst & Young Building at 121 King William Street, at an initial yield of 6.91%, and Permodalan Nasional Berhad
Area (Sq Mi) 2,969,907
Adelaide. The recent announcement of the ATO pre-commit- Area (Sq Mi) 2,969,907
from Malaysia acquiring Santos house for A$287 million at
ment for more than 30,000 SM has been the most significant an initial yield of 8.75%. Any recovery will be driven by an
leasing in the Adelaide market for some time. The Frame uptick in current demand levels and will require a significant
GDP Growth 3.0% GDP Growth 3.0%
office market has most of the new office stock available with recovery in economic conditions fuelled by the continued
the most significant being 400 King William Street. This sector spending of the government and the continuation of the
GDP 2010 (US$ B) $1,219.72 is approximately $100-$150/SM per year less than the core GDP 2010 (US$ B) $1,219.72 resources sector expansion, particularly the LNG sector.
CBD and offers a great alternative for the 1,000 to 2,000/SM In the retail sector, 2010 will probably be considered the low
GDP/Capita (US$) $54,868.92 tenant. The fringe office market has low vacancies with GDP/Capita (US$) $54,868.92
point of the cycle with retail spending being less than
limited incentives available to tenants. in 2009 and for forecasts for 2011. Population growth and
Inflation Rate 3.0% Inflation Rate 3.0%
The retail market is currently slow with tenants experiencing the resources boom should both contribute to an increase
Unemployment
the end of the benefits of the incentive packages and the Unemployment
in spending going forward after a patchy year. New devel-
5.2% 5.2%
Rate potential impact of interest rate increases. Owner occupiers Rate opments are on hold in the suburbs until retail spending
are active as some properties that are slow to attract solid increases, and are subject to any significant interest rate
Interest Rate 4.5% Interest Rate 4.5%
tenant enquiries become available for sale. increases in the foreseeable future.
Population (Millions) 22.23 Population (Millions) 22.23
Adelaide At A Glance Brisbane At A Glance

Conversion 1.02 AUD = 1 US$ RENT/M2/YR US$ RENT/SF/YEAR Conversion 1.02 AUD = 1 US$ RENT/M2/YR US$ RENT/SF/YR
Low High Low High Vacancy Low High Low High Vacancy
DOWNTOWN OFFICE DOWNTOWN OFFICE
New Construction (AAA) AUD 450.00 AUD 530.00 $ 40.99 $ 48.27 5.00% New Construction (AAA) AUD 550.00 AUD 700.00 $ 50.09 $ 63.76 N/A
Class A (Prime) AUD 450.00 AUD 520.00 $ 40.99 $ 47.36 5.00% Class A (Prime) AUD 500.00 AUD 700.00 $ 45.54 $ 63.76 9.80%
Class B (Secondary) AUD 250.00 AUD 350.00 $ 22.77 $ 31.88 10.00% Class B (Secondary) AUD 425.00 AUD 500.00 $ 38.71 $ 45.54 9.00%
SUBURBAN OFFICE SUBURBAN OFFICE
New Construction (AAA) AUD 350.00 AUD 420.00 $ 31.88 $ 38.25 N/A New Construction (AAA) AUD 375.00 AUD 525.00 $ 34.16 $ 47.82 N/A
Class A (Prime) AUD 280.00 AUD 350.00 $ 25.50 $ 31.88 N/A Class A (Prime) AUD 400.00 AUD 500.00 $ 36.43 $ 45.54 9.00%
Class B (Secondary) AUD 100.00 AUD 250.00 $ 9.11 $ 22.77 N/A Class B (Secondary) AUD 275.00 AUD 370.00 $ 25.05 $ 33.70 11.00%
INDUSTRIAL INDUSTRIAL
Bulk Warehouse AUD 80.00 AUD 110.00 $ 7.29 $ 10.02 N/A Bulk Warehouse AUD 100.00 AUD 115.00 $ 9.11 $ 10.47 N/A
Manufacturing AUD 60.00 AUD 80.00 $ 5.46 $ 7.29 N/A Manufacturing AUD 100.00 AUD 115.00 $ 9.11 $ 10.47 N/A
High Tech/R&D AUD 80.00 AUD 120.00 $ 7.29 $ 10.93 N/A High Tech/R&D AUD 100.00 AUD 115.00 $ 9.11 $ 10.47 N/A
RETAIL RETAIL
Downtown AUD 700.00 AUD 1,500.00 $ 63.76 $ 136.62 N/A Downtown AUD 1,500.00 AUD 4,000.00 $ 136.62 $ 364.32 5.30%
Neighborhood Service Centers AUD 350.00 AUD 450.00 $ 31.88 $ 40.99 N/A Neighborhood Service Centers AUD 400.00 AUD 800.00 $ 36.43 $ 72.86 N/A
Community Power Center N/A N/A N/A N/A N/A Community Power Center N/A N/A N/A N/A N/A
Regional Malls AUD 400.00 AUD 700.00 $ 36.43 $ 63.76 N/A Regional Malls AUD 1,100.00 AUD 1,700.00 $ 100.19 $ 154.84 N/A
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
Office in CBD AUD 2,500.00 AUD 3,000.00 $ 9,918,781.05 $ 11,902,537.26 Office in CBD N/A N/A N/A N/A
Land in Office Parks AUD 2,000.00 AUD 3,000.00 $ 7,935,024.84 $ 11,902,537.26 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks AUD 300.00 AUD 450.00 $ 1,190,253.73 $ 1,785,380.59 Land in Industrial Parks N/A N/A N/A N/A
Office/Industrial Land - Non-park AUD 300.00 AUD 400.00 $ 1,190,253.73 $ 1,587,004.97 Office/Industrial Land - Non-park AUD 300.00 N/A $ 1,190,253.73 N/A
Retail/Commercial Land AUD 800.00 AUD 1,000.00 $ 3,174,009.94 $ 3,967,512.42 Retail/Commercial Land N/A N/A N/A N/A
Residential AUD 900.00 AUD 1,200.00 $ 3,570,761.18 $ 4,761,014.91 Residential N/A N/A N/A N/A

Melbourne, Australia Perth, Australia
The office vacancy rate in the Melbourne CBD is set to rise Perth has been one of the more fortunate cities of the
but still remains below the levels seen in 2000. Vacancy rates developed world with very little shift in values of assets, from
in the 1st half of 2009 where relatively stable with minimal retail to industrial property. The market has seen strong
supply or demand. The challenging times ahead for Melbourne recovery in all asset classes except for retail, which is still
come with over 250,000 SM in completed space and an struggling in line with consumer spending. Western Australia
additional 180,000 SM the council has already approved. has been a boom and bust state and will continue in that
The market has been down but has had an increase in the vein whilst the key economic drivers remain large mining
second half of 2010. With vacancy rates at 5% for the first companies, controlled by commodity prices.
half of 2010, the market looks like it is moving towards Nearly 69,000 SM of office space were completed in
improving conditions. We expect net effective rents to fall 7% the 2009 calendar year. Another 230,000 SM set to be
in 2010 and believe that higher vacancy will add pressure to completed in the 2010-2012 period, of which a staggering
rents in the second half of 2010. Investment yields in the CBD 75% are pre-committed. Prime and secondary grade rents
are at the 10-year average, although yields eased through stabilized in Q1 2010 with downward pressures on tenant
the first half of 2010. incentives. Downtown vacancy rates peaked mid-2009 at
Industrial manufacturing has been quite volatile through 10.1% and are now easing back to historical levels of
2010, with the forecast for industrial demand to remain fairly around 6-7%.Strong investment into Western Australia
Contact Contact through the resources sector will see a significant growth
weak until late 2010. While the supply is beginning to slow,
NAI Harcourts Melbourne NAI Harcourts phase for the state with large companies aggressively
we believe concerns over vacancy remain high. Surprisingly,
+61 3 9670 1255 Metropolitan Perth securing limited supplies of office space.
in the east and southeast the rentals have declined the most in
+61 8 9388 6600
the first half of 2010 but the supply levels are not as high as Perth's industrial sector slumped in early 2009 with market
other markets. Yields settled in the second half of 2009 with sentiment subdued and institutional appetite low. Despite
expectations of a highly supplied market and with industrial land the imminent recovery, transactional evidence was limited.
supply low and demand keeping pressure on land values 2010 has seen a significant adjustment in both appetite and
throughout 2010. transactions, with keen vendors meeting market values and
Retail sales for the first half of 2010 increased and were a number of off-market transactions taking place. We
stronger than anticipated. Department stores and other are now seeing demand out-strip supply of large heavy
retailers had a good first half of 2010 and realized an overall industry workshops and warehouses with resources-based
Country Data Country Data companies positioning themselves for the coming shift.
improvement in retail sales with clothing and soft goods
remaining in positive growth. With new stock under construc- Perth is still oversupplied with small to medium warehouses
Area (Sq Mi) 2,969,907 Area (Sq Mi) 2,969,907 with mom and pop investors still feeling the effects of
tion, 100,000 SM came online over the second half of
2009, an additional 100,000 SM in 2010 and 140,000 SM vacancies through the end of the down cycle.
expected for 2011 Potential supply remains high, with Retail has been dormant over the past 12 months with
360,000 SM having already received council approval. Retail discretionary spending at a low with caution being taken.
GDP 2010 (US$ B) $1,219.72 sales are forecasted to weaken over the second half of 2010. GDP 2010 (US$ B) $1,219.72 However, 2010 has seen a shift in sentiment and retail
Rental growth is to remain weak over the remainder of 2010 space is being taken up with vacancies now at around 7.5%
GDP/Capita (US$) $54,868.92 and a further decline could be possible into 2011 as supply GDP/Capita (US$) $54,868.92 across the retail sector. Investment sales have been limited
continues to come on the market. Yields have eased in most to private buyers with institutions non-existent. Caution has
Inflation Rate 3.0% city centers in 2010, although they still remain low overall Inflation Rate 3.0% been the fundamental view across the state. A number of over-
when compared to other cities over a 10-year period. seas and institutional investors are now taking a closer look at
Unemployment 5.2% Unemployment 5.2% the opportunities becoming available with the volatility of our
Rate Rate
dollar and the massive expansions being undertaken within
Interest Rate 4.5% Interest Rate 4.5% the resources sector to be a part of the upswing.
Melbourne At A Glance Perth At A Glance

Conversion 1.02 AUD = 1 US$ RENT/M2/YR US$ RENT/SF/YEAR Conversion 1.02 AUD = 1 US$ RENT/M2/YR US$ RENT/SF/YR
Class A (Prime) AUD 400.00 AUD 450.00 $ 36.43 $ 40.99 4.00% Class A (Prime) AUD 550.00 AUD 675.00 $ 50.09 $ 61.48 3.00%
Class B (Secondary) AUD 300.00 AUD 350.00 $ 27.32 $ 31.88 5.00% Class B (Secondary) AUD 450.00 AUD 550.00 $ 40.99 $ 50.09 N/A
Class A (Prime) AUD 250.00 AUD 300.00 $ 22.77 $ 27.32 5.00% Class A (Prime) AUD 375.00 AUD 450.00 $ 34.16 $ 40.99 N/A
Class B (Secondary) AUD 180.00 AUD 190.00 $ 16.39 $ 17.31 7.00% Class B (Secondary) AUD 250.00 AUD 325.00 $ 22.77 $ 29.60 N/A
Bulk Warehouse AUD 150.00 AUD 170.00 $ 13.66 $ 15.48 5.00% Bulk Warehouse AUD 75.00 AUD 120.00 $ 6.83 $ 10.93 N/A
Manufacturing AUD 140.00 AUD 150.00 $ 12.75 $ 13.66 7.00% Manufacturing AUD 65.00 AUD 110.00 $ 5.92 $ 10.02 N/A
High Tech/R&D AUD 150.00 AUD 160.00 $ 13.66 $ 14.57 5.00% High Tech/R&D AUD 90.00 AUD 160.00 $ 8.20 $ 14.57 N/A
RETAIL RETAIL
Downtown AUD 800.00 AUD 900.00 $ 72.86 $ 81.97 3.00% Downtown AUD 1,000.00 AUD 3,500.00 $ 91.08 $ 318.78 N/A
Neighborhood Service Centers AUD 450.00 AUD 500.00 $ 40.99 $ 45.54 6.00% Neighborhood Service Centers AUD 350.00 AUD 600.00 $ 31.88 $ 54.65 N/A
Regional Malls AUD 700.00 AUD 750.00 $ 63.76 $ 68.31 3.00% Regional Malls AUD 250.00 AUD 400.00 $ 22.77 $ 36.43 N/A
Office in CBD N/A N/A N/A N/A Office in CBD N/A N/A N/A N/A
Land in Office Parks AUD 150.00 AUD 160.00 $ 595,126.86 $ 634,801.99 Land in Office Parks AUD 350.00 AUD 500.00 $ 1,388,629.35 $ 1,983,756.21
Land in Industrial Parks AUD 130.00 AUD 150.00 $ 515,776.61 $ 595,126.86 Land in Industrial Parks AUD 160.00 AUD 550.00 $ 634,801.99 $ 2,182,131.83
Office/Industrial Land - Non-park AUD 120.00 AUD 130.00 $ 476,101.49 $ 515,776.61 Office/Industrial Land - Non-park AUD 300.00 AUD 550.00 $ 1,190,253.73 $ 2,182,131.83
Retail/Commercial Land AUD 850.00 AUD 900.00 $ 3,372,385.56 $ 3,570,761.18 Retail/Commercial Land AUD 1,500.00 AUD 3,000.00 $ 5,951,268.63 $11,902,537.26
Residential AUD 1,400.00 AUD 1,500.00 $ 5,554,517.39 $ 5,951,268.63 Residential N/A N/A N/A N/A

Sydney, Australia Beijing, China
New South Wales and Sydney have contributed modestly in The economic situation in Beijing is still maintaining the
GDP growth terms relative to the other states, contributing to growth trend experienced in 2010. According to the Beijing
Australia's strong overall economic performance. Sydney, Statistics Bureau, the city’s GDP as of Q3 2010 equaled
however, is poised to post a solid growth of 2.6% in 2010 and RMB 975.44 billion, up 10.1% year on year. The total fixed
is forecasting acceleration in growth in 2011 of 2.9%. This asset investment in Beijing was up 6.6% to RMB 374.1
is largely driven by the strong performance of the financial billion. The investment infrastructure was RMB 83.49 billion
services sector and the increase in the New South Wales down 19.8% year on year and real estate was RMB 206.52
economy from the resources sector. billion, up 16.4% year on year.
Stronger profits in New South Wales in 2010 led to an The overall vacancy rate in the Beijing office market in 3Q
employment growth that is expected to continue in 2011. 2010 was 16.76%, down 0.59% from the previous quarter.
This has resulted in a rebound of the total amount of office The main reason for the decline in the vacancy rate was that
space leased in the Sydney CBD. The steady increase in no new supply was delivered in Q3, providing a good
vacancy rates is now expected to peak at around 9% in 2011. opportunity to take up the existing vacant space in the
In the metropolitan office market, Sydney's North Shore is market. In addition, with steady economic development,
expected to be the strongest of the markets over the next demand for some companies increased. There was a
several years. Limited supply over that period is expected to notable rise in the transaction volume for foreign-based
Contact create pressure on rents in North Sydney, St. Leonards and Contact companies in Q3 2010 over the previous quarter. Alibaba
NAI Harcourts Sydney Crows Nest. NAI Imperial Real Estate leased 9,000 SM for IT enterprises and Halliburton leased
+ 61 2 9380 8665 +86 10 5870 0399 4,000 SM in the World Financial Center.
The sales market continues to be characterized by low
volumes of activity. 2010 saw an increase in activity in the Based on these leasing trends, it is forecast that the leasing
Sydney CBD and as a result there was a firming in investment transactions for Grade A office space for foreign companies
yields. The North Shore has seen less activity than in 2009. will returned to the previous level. According to NAI
However, metropolitan sales look to have maintained a stable Imperial’s latest statistics, by the end of Q3 2010, the overall
yield profile over the last 12 months and this trend is average asking rental (including Grade A and Grade B
expected to continue. office buildings) leveled in the Beijing office market to
The industrial market has begun to show signs of recovery. RMB180.09/SM per month (including the property manage-
Increased leasing and sales activity has resulted in a slight ment fee), up 0.65% from the previous quarter. The main
Country Data Country Data reason for the rising rental rates is the lack of new supply
softening of incentives and a firming of yields. The improve-
ment in net effective rents and yields points to future growth in this quarter and the gradual increase in market demand.
Area (Sq Mi) 2,969,907 Area (Sq Mi) 3,705,407
in capital values. However, access to capital remains an issue According to data by Beijing Real Estate, the transaction
for most developers. It is expected that general levels of sales management net in the investment sector of the office
and leasing activity will continue to grow underpinned by New market was active with the main transaction area being
South Whales GDP growth. Wangjing, Shangdi and Zhongguancun. Meanwhile, large-
GDP 2010 (US$ B) $1,219.72 GDP 2010 (US$ B) $5,745.13 scale real estate developments and foreign investment
The retail sector continues to be a positive story in 2010
given the Australian economies strong performance through institutions announced they will be entering the Chinese
GDP/Capita (US$) $54,868.92 GDP/Capita (US$) $4,282.89 commercial real estate market. The successful implemen-
the global financial crisis. That said the possibility of a rise in
interest rates during the remainder of 2010 and into 2011, tation of this measure will show investment returns in
Inflation Rate 3.0%
looms as a threat to retail property returns. Quality new supply
Inflation Rate 3.5% commercial real estate that gradually reach investment
has had a positive effect on prime CBD rents and the limited expectations by the foreign investment institutions. It is
Unemployment 5.2% Unemployment 4.1% expected that many large-scale investor will be prepared to
Rate supply of new space in regional centers has also been Rate
positive for rental rates. However, yields have reached a enter to office market.
plateau due to concerns over retail spending and the impact
Population (Millions) 22.23
this will have on retail traders in the coming 12 months. Population (Millions) 1,341.41
Sydney At A Glance Beijing At A Glance

Conversion 1.02 AUD = 1 US$ RENT/M2/YR US$ RENT/SF/YEAR Conversion 6.67 RMB = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) AUD 900.00 AUD 1,200.00 $ 81.97 $ 109.30 5.00% New Construction (AAA) RMB 174.00 RMB 240.00 $ 29.08 $ 40.11 25.00%
Class A (Prime) AUD 590.00 AUD 850.00 $ 53.74 $ 77.42 6.00% Class A (Prime) RMB 180.00 RMB 400.00 $ 30.09 $ 66.86 12.00%
Class B (Secondary) AUD 420.00 AUD 600.00 $ 38.25 $ 54.65 9.00% Class B (Secondary) RMB 75.00 RMB 173.00 $ 12.54 $ 28.92 17.00%
New Construction (AAA) AUD 400.00 AUD 460.00 $ 36.43 $ 41.90 N/A New Construction (AAA) RMB 150.00 RMB 210.00 $ 25.07 $ 35.10 20.00%
Class A (Prime) AUD 370.00 AUD 410.00 $ 33.70 $ 37.34 9.00% Class A (Prime) RMB 150.00 RMB 330.00 $ 25.07 $ 55.16 11.00%
Class B (Secondary) AUD 220.00 AUD 330.00 $ 20.04 $ 30.06 10.00% Class B (Secondary) RMB 69.00 RMB 165.00 $ 11.53 $ 27.58 15.00%
Bulk Warehouse AUD 85.00 AUD 140.00 $ 7.74 $ 12.75 N/A Bulk Warehouse RMB 15.00 RMB 45.00 $ 2.51 $ 7.52 N/A
Manufacturing AUD 78.00 AUD 180.00 $ 7.10 $ 16.39 N/A Manufacturing RMB 15.00 RMB 40.00 $ 2.51 $ 6.69 N/A
High Tech/R&D AUD 180.00 AUD 275.00 $ 16.39 $ 25.05 N/A High Tech/R&D RMB 54.00 RMB 90.00 $ 9.03 $ 15.04 N/A
RETAIL RETAIL
Downtown AUD 6,100.00 AUD 13,000.00 $ 555.59 $ 1,184.05 1.00% Downtown RMB 280.00 RMB 1,500.00 $ 46.80 $ 250.71 12.80%
Neighborhood Service Centers AUD 400.00 AUD 2,000.00 $ 36.43 $ 182.16 N/A Neighborhood Service Centers RMB 37.00 RMB 140.00 $ 6.18 $ 23.40 18.70%
Community Power Center AUD 150.00 AUD 700.00 $ 13.66 $ 63.76 7.00% Community Power Center RMB 23.00 RMB 165.00 $ 3.84 $ 27.58 16.40%
Regional Malls AUD 1,100.00 AUD 3,800.00 $ 100.19 $ 346.11 N/A Regional Malls N/A N/A N/A N/A N/A
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores RMB 80.00 RMB 645.00 $ 13.37 $ 107.81 8.80%
Land in Office Parks N/A N/A N/A N/A Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks RMB 205.09 RMB 6,313.00 $ 124,433.44 $ 3,830,261.47
Office/Industrial Land - Non-park AUD 200.00 AUD 900.00 $ 8,541,117.37 $ 38,435,028.15 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land RMB 1,722.00 RMB 14,606.00 $ 1,044,782.24 $ 8,861,840.50
Residential N/A N/A N/A N/A Residential RMB 8,016.00 RMB 17,949.00 $ 4,863,515.92 $ 10,890,125.65

Hong Kong, China Shanghai, China
The commercial real estate market performed well as the Amid the success of the World Expo, Shanghai has witnessed
economy staged a strong rebound in 2010. Both the export sustained growth in every sector (over 70 million visitors), with
and the retail sectors recorded double-digit growth as the the exception of residential sales that experienced a
overall economy of Hong Kong expanded by 7.2% in the period of decline due to new policies from the government in
first half of 2010; unemployment dropped to 20-month low an attempt to cool the market and prevent overheating. New
of 4.2% in August. Continuous inflow of foreign direct retail and office developments were launched on both sides
investment into Asia coupled with a record low interest rate of the river and supply was matched by demand from firms
is fueling real estate transactions. recovering from the economic crisis and expanding.
Office vacancy fell from about 10.3% at the end of 2009 Despite new supply to the market in both Puxi and Pudong,
to 6.9% in October 2010. Strong expansion of the financial including the highly anticipated Wheelock Square with some
sector and Mainland Chinese companies seeking IPOs and 111,312 SM, demand grew throughout 2010 and is expected
offices in the CBD drove the occupancy rate in prime buildings to continue through 2011. Vacancy rates have been decreas-
to about 98%. Overall, average rents grew approximately 8% ing, particularly in new, prime developments as companies
in 2010 while CBD rents rose by 25% after declining more are looking to expand and upgrade their businesses, forcing
than 30% in 2009. New supply of Grade A office will be rents up by some 20% compared with 2009.
limited, with three new buildings totaling 540,000 SF in
Contact Central planned for completion in 2011. Importantly, the new Contact With the government’s continued restrictions on industrial real
emerging district of Kowloon Bay saw vacancies decline from estate development in the well established, more conveniently
NAI Asia Pacific NAI Asia Pacific
almost 30% to less than 10% in 2010 with over 2 million SF located industrial parks, many companies have been forced
Properties, Ltd. Properties
of net take-up. This improvement is understandable as to look further afield for their expansion or entry. Overall
+ 852 2281 7800 +86 21 6288 7333
rents are a fraction of those in Central at HKD15-20/SF for demand has increased steadily, with new entrants to the
comparable buildings. market (such as Volvo in Jiading North Industrial Zone –
comprising China HQ, R&D Center and manufacturing), an
The retail sector, comprising approximately 26% of the total
increase in export demand (particularly Asian related) and
GDP, was another engine of growth. International retail
growing domestic consumer demand. Consequently rents
chains increased their presence in Hong Kong to take
have progressively increased across the region and such
advantage of the affluent Mainland shoppers. Rents and
prices of retail assets in prime districts including Causeway steady growth is set to continue in 2011.
Country Data Bay and Central are both at record highs while vacancies Country Data Persistent demand in the retail sector, particularly from
Area (Sq Mi) 3,705,407
are below 2%. Average prices climbed by 13% as average luxury clothing retailers, has maintained tight supply in core
Area (Sq Mi) 3,705,407
retail rents grew by approximately 10%. locations. Emerging supply from IFC, Tong Li, Shimao and the
Industrial assets appreciated significantly due to a policy renovation of Hong Kong Plaza and Lippo Plaza have
change by the Government in April, facilitating the conver- contributed to stable rentals. Going forward, vacancy rates
sion of older industrial buildings to commercial or other use. are likely to remain steady in key areas, despite additional
GDP 2010 (US$ B) $5,745.13 GDP 2010 (US$ B) $5,745.13 retail sites like Park Place preparing for launch. In less
Redevelopment activity has been rising; prices climbed by
about 13% as rents grew by 8% as of September 2010. central areas, additional supply including Star Mall and IMAGO
GDP/Capita (US$) $4,282.89 GDP/Capita (US$) $4,282.89 that brought some 100,000 SM to the market this year, will
Investment yields remain near their low 3% levels. While the temper occupancy rates and landlord pricing power.
Inflation Rate 3.5% investment market is heavily influenced by capital inflows Inflation Rate 3.5%
from China, the historical low rental return is raising concern The investment market continued its recovery from
Unemployment that there may be an asset bubble in certain segments of the global credit crunch, with local investors making the vast
4.1% Unemployment 4.1%
Rate the property sector, which may see an adjustment in 2011. Rate majority of acquisitions, such as the Agricultural Bank of
China purchasing a 41 story office building in Lujiazui from
Interest Rate 5.6% Although real estate agencies broadly are predicting unbridled Interest Rate 5.6% CITIC group for RMB 3.77 Billion. International players also
growth in rentals driven by China’s strength, NAI Asia Pacific
increased their volume of acquisitions, such as Ascendas
Population (Millions) 1,341.414 Properties believes that the Hong Kong economy remains Population (Millions) 1,341.414
with Cross Towers, JP Morgan with Pinnacle Century Park
closely connected to the U.S. given the pegged exchange rate.
As such, 2011 may see some consolidation if corporations and CSI with Platinum.
trim global budgets or shift more of their operations to China.
Hong Kong At A Glance Shanghai At A Glance
Conversion 7.75 HKD = 1 US$ RENT/SF/MO US$ RENT/SF/YR Conversion 6.67 RMB = 1 US$ RENT/M2YR US$ RENT/SF/YR
New Construction (AAA) HKD 110.00 HKD 160.00 $ 170.32 $ 247.74 3.00% New Construction (AAA) RMB 2,640.00 RMB 3,660.00 $ 36.77 $ 50.98 30.00%
Class A (Prime) HKD 75.00 HKD 145.00 $ 116.13 $ 224.52 5.00% Class A (Prime) RMB 2,340.00 RMB 3,660.00 $ 32.59 $ 50.98 13.00%
Class B (Secondary) HKD 40.00 HKD 60.00 $ 61.94 $ 92.90 5.00% Class B (Secondary) RMB 1,620.00 RMB 2,520.00 $ 22.56 $ 35.10 15.00%
New Construction (AAA) HKD 40.00 HKD 50.00 $ 61.94 $ 77.42 10.00% New Construction (AAA) RMB 1,080.00 RMB 1,620.00 $ 15.04 $ 22.56 35.00%
Class A (Prime) HKD 30.00 HKD 40.00 $ 46.45 $ 61.94 8.00% Class A (Prime) RMB 960.00 RMB 1,500.00 $ 13.37 $ 20.89 20.00%
Class B (Secondary) HKD 20.00 HKD 25.00 $ 30.97 $ 38.71 8.00% Class B (Secondary) RMB 720.00 RMB 1,080.00 $ 10.03 $ 15.04 30.00%
Bulk Warehouse HKD 10.00 HKD 12.00 $ 15.48 $ 18.58 15.00% Bulk Warehouse RMB 216.00 RMB 468.00 $ 3.01 $ 6.52 10.00%
Manufacturing HKD 12.00 HKD 15.00 $ 18.58 $ 23.23 10.00% Manufacturing RMB 192.00 RMB 432.00 $ 2.67 $ 6.02 15.00%
High Tech/R&D HKD 15.00 HKD 20.00 $ 23.23 $ 30.97 10.00% High Tech/R&D RMB 432.00 RMB 1,500.00 $ 6.02 $ 20.89 20.00%
RETAIL RETAIL
Downtown HKD 300.00 HKD 1,200.00 $ 464.52 $ 1,858.06 3.00% Downtown RMB 3,600.00 RMB 18,240.00 $ 50.14 $254.05 3.00%
Neighborhood Service Centers HKD 50.00 HKD 100.00 $ 77.42 $ 154.84 10.00% Neighborhood Service Centers RMB 1,800.00 RMB 7,200.00 $ 25.07 $100.28 7.00%
Community Power Center HKD 40.00 HKD 60.00 $ 61.94 $ 92.90 10.00% Community Power Center RMB 720.00 RMB 1,800.00 $ 10.03 $ 25.07 10.00%
Regional Malls HKD 100.00 HKD 300.00 $ 154.84 $ 464.52 5.00% Regional Malls RMB 1,800.00 RMB 7,200.00 $ 25.07 $100.28 5.00%
Office in CBD N/A N/A N/A N/A Office in CBD RMB 5,000.00 RMB 203,000.00 $ 3,033,630.19 $ 123,165,385.60
Land in Office Parks N/A N/A N/A N/A Land in Office Parks RMB 1,500.00 RMB 8,000.00 $ 910,089.06 $ 4,853,808.30
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks RMB 400.00 RMB 2,000.00 $ 242,690.41 $ 1,213,452.07
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land N/A N/A N/A N/A
Residential N/A N/A N/A N/A Residential RMB 4,500.00 RMB 35,500.00 $ 2,730,267.17 $ 21,538,774.33

Guam Chennai, India
Guam is an unincorporated territory of the U.S. under the Chennai is well on the way to becoming a leading global city
administration and jurisdiction of the Office of Insular Affairs, with the state taking steps to provide international infrastruc-
U.S. Department of the Interior. Because of its strategic ture facilities in the coming years. Initiatives such as construc-
location as the westernmost U.S. territory, Guam plays a tion of circular high speed corridors, Greenfield airport,
crucial role in U.S. military defense of the Pacific region. implementation of the metro rail project, flyovers and over
Guam's economy is greatly influenced by the health of the bridges, financial city, sports city and media city are all being
Asian economies, primarily Japan, Korea and China. designed as part of the Chennai 2020 plan.
The much anticipated Record of Decision was released in The commercial office sector is looking up in Chennai. Buoyed
September 2010, solidifying the actions that the U.S. military by stronger economic fundamentals, the Chennai office
will carry out on Guam for the arrival of approximately 8,600 market has seen a fair amount of activity in 2010. In a sign of
Marines and their dependents from Okinawa. The island, the improving sentiment, take-up of space has increased and
covering an area of 212 square miles, is now clearly on its rental values have bottomed out in most markets. Net absorp-
way toward unprecedented construction of roads, power tion is nearly 3 million SF in the first three quarters of 2010
plants, sewer and general infrastructure to prepare for the with expectations for 2011 to be better for the overall real
development of several thousand military homes and training estate market in Chennai. The sluggish leasing, uncertainty in
facilities. Japan will fund approximately $1.3 billion in infra- the market and falling rentals witnessed in 2009 have been
Contact structure upgrades while the U.S. Department of Defense Contact replaced by a more stable office market due to the increase
NAI ChaneyBrooks will fund $560 million in 2011. The final sticker price is NAI Hemdev's in market activity. Some of the more notable transactions for
+671 649 8742 estimated to be over $15 billion, which translates to $100 International Realty leased space have been Nokia Siemens Network, Franklin
million per capita. The military buildup is attracting contrac- Services Templeton, TCS Eserve, First Source, Slash Support, Reliance
tors, suppliers and laborers from throughout the U.S. and +91 44 2822 9595 Communications, RBS, WNS, L&T Infotech, CTS, Igate Neptune,
international markets. It is anticipated that the population of Force 10, Hapag Lloyd and Amazon.
Guam may increase by as much as 25% during this period. The demand for return on investment properties, i.e., purchase
Tourism continues to be Guam’s main economic driver. of office/commercial properties with tenants for assured rental
While Japan is the primary source of visitors, Chinese returns, continues to be strong in Chennai given the ROI cou-
tourist arrivals continue to increase and are expected to pled with property appreciation. Demand from the hospitality,
soon surpass Korean visitors to Guam. Statistics show that education and healthcare sectors continues to expand given
Country Data Guam is now the most popular travel destination for Country Data the opportunities being created by a growing economy.
Area (Sq Mi) 212,000 the Chinese due to the island’s proximity, affordability Area (Sq Mi) 1,236,085
After a lull in the market, signs of a recovery are being
and, more importantly, the accessibility of visitor visas. witnessed in Chennai’s retail sector, specifically in the High
GDP Growth N/A The merger of Continental Airlines and United Airlines is GDP Growth 9.7%
Streets where increasing inquiries and conversions are leading
expected to increase the number and frequency of flights to strengthening of retail rentals. The largest mall in Chennai,
GDP 2010 (US$ B) $2.7 to the island. GDP 2010 (US$ B) $1,430.02 Express Avenue, is operational and is expected to be a
Guam is one of the few bright spots in the U.S. economy preferred destination for both retailers and shoppers alike
GDP/Capita (US$) $15,000.00 benefiting from its strategic proximity to the booming Asian GDP/Capita (US$) $1,176.06 given the size and location. Mall culture is catching on in
markets and the implementation of U.S.-Japan defense Chennai given the response to Ampa Mall, Express Avenue
Inflation Rate 2.5% initiatives. The need for warehouses, office, residential and Inflation Rate 13.2% and Chennai Citi Center.
retail properties is generating increased deal flows and The overall outlook is positive with a continuing improvement
Unemployment 9.3% widespread speculative investments. Unemployment 10.7%
Rate Rate in the economy and indications that demand for office space
will increase but the existing vacancy rates will keep prices in
Interest Rate N/A Interest Rate 5.0% check.
Population (Millions) 180,865 Population (Millions) 1,215.939
Guam At A Glance Chennai At A Glance

US$ RENT/SF/YR Low High Effective Avg. Vacancy Conversion 44.25 INR = 1 US$ RENT/SF/MO US$ RENT/SF/YR
DOWNTOWN OFFICE Low High Low High Vacancy
New Construction (AAA) N/A N/A N/A N/A DOWNTOWN OFFICE
Class A (Prime) N/A N/A N/A N/A New Construction (AAA) INR 60.00 INR 75.00 $ 16.27 $ 20.34 N/A
Class B (Secondary) $28.08 $ 45.36 $ 36.72 12.50% Class A (Prime) INR 50.00 INR 65.00 $ 13.56 $ 17.63 N/A
SUBURBAN OFFICE Class B (Secondary) INR 35.00 INR 50.00 $ 9.49 $ 13.56 N/A
New Construction (AAA) N/A N/A N/A N/A SUBURBAN OFFICE
Class A (Prime) N/A N/A N/A N/A New Construction (AAA) INR 25.00 INR 45.00 $ 6.78 $ 12.20 N/A
Class B (Secondary) $ 15.12 $ 38.88 $ 34.56 18.00% Class A (Prime) INR 25.00 INR 45.00 $ 6.78 $ 12.20 N/A
INDUSTRIAL Class B (Secondary) INR 20.00 INR 35.00 $ 5.42 $ 9.49 N/A
Bulk Warehouse $ 8.42 $ 19.44 $ 18.14 9.00% INDUSTRIAL
Manufacturing $ 8.42 $ 19.44 $ 18.14 11.00% Bulk Warehouse INR 14.00 INR 22.00 $ 3.80 $ 5.97 N/A
High Tech/R&D N/A N/A N/A N/A Manufacturing INR 17.00 INR 24.00 $ 4.61 $ 6.51 N/A
RETAIL High Tech/R&D INR 19.00 INR 27.00 $ 5.15 $ 7.32 N/A
Downtown $ 35.64 $ 116.64 $ 93.96 14.00% RETAIL
Neighborhood Service Centers $ 14.04 $ 64.80 $ 46.44 12.00% Downtown INR 100.00 INR 175.00 $ 27.12 $ 47.46 N/A
Community Power Center $ 10.36 $ 16.20 $ 18.46 11.00% Neighborhood Service Centers INR 50.00 INR 90.00 $ 13.56 $ 24.41 N/A
Community Power Center N/A N/A N/A N/A N/A
Regional Malls $ 38.88 $ 77.76 $ 77.76 7.00%
Regional Malls INR 35.00 INR 70.00 $ 9.49 $ 18.98 N/A
Solus Food Stores N/A N/A N/A N/A
DEVELOPMENT LAND Solus Food Stores INR 30.00 INR 50.00 $ 8.14 $ 13.56 N/A
Office in CBD Low/Acre High/Acre
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD INR 4,000.00 INR 7,000.00 $ 90.40 $ 158.19
Land in Office Parks N/A N/A
Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks N/A N/A
Land in Industrial Parks INR 3,200,000.00 INR 11,000,000.00 $ 72,316.38 $ 248,587.57
Office/Industrial Land - Non-park $ 815,000.00 $ 1,163,200.00
Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land $ 815,000.00 $ 1,163,200.00
Retail/Commercial Land INR 540,000,000.00 INR 800,000,000.00 $12,203,389.83 $ 18,079,096.05
Residential $ 1,285,000.00 $ 2,480,000.00 INR 270,000,000.00 INR 7,000,000,000.00 $ 6,101,694.92 $158,192,090.40
Residential
$ 116,640.00 $ 734,400.00

Delhi, Gurgaon, India Kolkata, India
According to the Center for Monitoring Indian Economy, the Kolkata is the capital of the state of West Bengal and a main
GDP is expected to grow by 9.2% from 2010 to 2011 as center for commerce and financial services in eastern India.
compared to the 7.4% growth seen from 2009 to 2010. With a huge talent pool and high quality infrastructure,
According to the latest report of FICCI and E&Y, India is the city has become one of the major private investment
ranked as the fifth most attractive destination for future real destinations in the country. In 2009, the state attracted
estate investments on a list topped by China, followed by over 8,400 core investments in various sectors such as
the U.S., UK and Singapore. iron and steel, petrochemicals, information technology and
The recently concluded XIX Commonwealth Games held in food processing.
New Delhi, added to the infrastructure developments as well Kolkata’s IT sector is one of the important driving forces of
as better connectivity through roads and the Metro in the NCR the state’s economy and employs some 90,000 people. The
region, resulting in a benefit to the overall real estate market. sector registered 8% growth during 2009 and 2010. As
These clear indications of revival of the Indian economy gave market confidence strengthened in tandem with the overall
a boost to the office and residential sectors as well. economic growth, demand for office space has started to
The rentals in CBD & SBD for Grade A office space witnessed pick up. SBD areas such as Sector-V in Salt Lake and New
an increase of 2-3% during the recent months. The absorption Town in Rajarhat have seen most of the office sales and
was mainly driven by the insurance, banking and financial leasing transactions in 2010. Approximately 450,000 to
Contact Contact 500,000 SF of office space was transacted across the
sectors. The vacancy levels dropped only marginally. Leasing
NAI Collaborators India activity remains stagnant in Saket District Center whereas NAI NK Realtors Kolkata market over the first half of 2010. With the height-
+91 11 4668 7000 Jasola District Center witnessed an absorption of more than +91 33 4040 1010 ened demand and low mortgage rate, investors have
25,000 SF of office space in mid 2010. outpaced end users in office space acquisitions during the
first half of 2010. Investors are mainly looking at new prop-
The PBD (Periphery Business District) Gurgaon market
erties under construction with large floor plates at Sector-V
witnessed increased levels of transaction activity with ap-
and New Town.
proximately 200,000 SF leased in IT parks and 250,000 SF
leased in SEZ in Q2 2010. The Noida market also observed As market sentiment improved, retailers were back in
an increased number of inquiries and transactions in SEZ. expansion mode once again in the Kolkata market. Large
The rentals and capital value in PBD remains stable as new domestic retail chains such as Future Group, Aditya Birla
supply of approximately 1.2 million SF was added to Retail, Reliance Retail and Spencer’s are all eyeing the
Country Data Gurgaon and Noida’s existing inventory in the first half of Country Data Kolkata market with renewed interest, which has resulted
Area (Sq Mi) 1,236,085 2010. With a large number of players entering the market, Area (Sq Mi) 1,236,085 in an increased demand for large format retail space. The
the supply is also likely to increase. It is projected that the retail market has witnessed increased leasing and selling
GDP Growth 9.7% real estate sector is likely to face the problem of too much GDP Growth 9.7% activity during the first three quarters of 2010; however,
supply of office space that will outpace demand resulting in much of that activity has been concentrated in smaller High
GDP 2010 (US$ B) $1,430.02 a drop in rental rates. GDP 2010 (US$ B) $1,430.02 Street properties.
Property transactions in Delhi & Gurgaon are set to increase The residential market continued the upward momentum
GDP/Capita (US$) $1,176.06 in cost after the new circle rate revision in October 2010. GDP/Capita (US$) $1,176.06 seen at the end of 2009, giving rise to remarkable sales and
For the sale and purchase of property, the enhanced circle new launches throughout 2010. Affordable housing, which
Inflation Rate 13.2% rate in Delhi will be 100% and Gurgaon will be 5-20% of the Inflation Rate 13.2% constitutes around 95% of the ongoing projects, is currently
existing rates. The circle rate of properties is the system in driving the Kolkata residential market. The most affordable
Unemployment 10.7% which the government fixes the minimum or maximum rate Unemployment 10.7% price in this segment is in the range between INR 1,800 to
Rate Rate
of the land depending on the category of colonies it falls in. INR 2,500/SF. Kolkata’s prime residential market has been
Interest Rate 5.0% With a large number of players entering the market, the supply Interest Rate 5.0% able to maintain a moderate growth across the micro
is also likely to increase even as connectivity through road and markets such as Alipore, Central Kolkata, Ballygunge and
Population (Millions) 1,215.939 Population (Millions) 1,215.939
Metro networks in the NCR shows a vast improvement. It is New Town.
projected that the office market is likely to face the problem of
too much supply of office rental space that will outpace
demand resulting in a further drop in rental rates.
Delhi At A Glance Kolkata At A Glance
Conversion 44.25 INR = 1 US$ RENT/SF/MONTH US$ NET RENT/SF/YEAR Conversion 44.25 INR = 1 US$ NET RENT/SF/MO US$ RENT/SF/YR
New Construction (AAA) INR 350.00 INR 375.00 $ 94.92 $ 101.69 6.00% New Construction (AAA) INR 125.00 INR 150.00 $ 33.90 $ 40.68 40.00%
Class A (Prime) INR 325.00 INR 350.00 $ 88.14 $ 94.92 5.00% Class A (Prime) INR 120.00 INR 140.00 $ 32.54 $ 37.97 3.00%
Class B (Secondary) INR 160.00 INR 185.00 $ 43.39 $ 50.17 9.00% Class B (Secondary) INR 90.00 INR 100.00 $ 24.41 $ 27.12 5.00%
Bulk Warehouse INR 8.00 INR 20.00 $ 2.17 $ 5.42 20.00% Bulk Warehouse INR 9.00 INR 20.00 $ 2.44 $ 5.42 30.00%
Manufacturing INR 15.00 INR 40.00 $ 4.07 $ 10.85 25.00% Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D INR 15.00 INR 45.00 $ 4.07 $ 12.20 25.00% High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown INR 300.00 INR 900.00 $ 81.36 $ 244.07 17.00% Downtown INR 90.00 INR 300.00 $ 24.41 $ 81.36 20.00%
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers INR 70.00 INR 300.00 $ 18.98 $ 81.36 8.00%
Community Power Center N/A N/A N/A N/A N/A Community Power Center INR 55.00 INR 250.00 $ 14.92 $ 67.80 5.00%
Regional Malls INR 150.00 INR 250.00 $ 40.68 $ 67.80 25.00% Regional Malls INR 130.00 INR 300.00 $ 35.25 $ 81.36 5.00%
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores INR 35.00 INR 40.00 $ 9.49 $ 10.85 N/A
DEVELOPMENT LAND Low/Acre High/Acre Low/SF High/SF DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD INR 578.00 INR 889.00 $ 13.06 $ 20.09 Office in CBD INR 605,484,000.00 INR 906,048,000.00 $ 13,683,254.24 $ 20,475,661.02
Land in Office Parks INR 1,333,333.00 INR 2,222,222.00 $ 30,131.82 $ 50,219.71 Land in Office Parks INR 151,371,000.00 INR 200,376,000.00 $ 3,420,813.56 $ 4,528,271.19
Land in Industrial Parks INR 111,111.00 INR 3,333,333.00 $ 2,510.98 $ 75,329.56 Land in Industrial Parks INR 15,246,000.00 INR 18,295,200.00 $ 344,542.37 $ 413,450.85
Office/Industrial Land - Non-park INR 44,444.00 INR 111,111.00 $ 1,004.38 $ 2,510.98 Office/Industrial Land - Non-park INR 6,098,400.00 INR 30,492,000.00 $ 137,816.95 $ 689,084.75
Retail/Commercial Land INR 3,333,333.00 INR 21,111,111.00 $ 75,329.56 $ 477,087.25 Retail/Commercial Land INR 609,840,000.00 INR 958,320,000.00 $ 13,781,694.92 $ 21,656,949.15
Residential INR 22,222,222.00 INR 66,666,667.00 $ 502,197.11 $1,506,591.34 Residential INR 12,196,800.00 INR 871,200,000.00 $ 275,633.90 $ 19,688,135.59

Pune, Maharashtra, India Punjab, India
Pune is strategically located 150 kilometers from Mumbai, The real estate market in India continues to be buzzing with
the financial capital of India. The key drivers of this city stem a lot of activity. End-users drove the market in 2010. The
from the turbine industries like Alfa-Laval, Thermax and economy is growing at a rate of approximately 8.6%, a
others. Bharat Forge is the world's second largest forging good sign for the real estate market, making it highly
company. The auto industry and telecommunications sectors lucrative for investors from all over the country and around
are on an upward trend, while IT remains reticent. the globe. The purchasing power has increased substan-
In addition to the huge number of educational institutions tially, leading to a spurt in residential and commercial
and universities, Pune has statistics to back its claim for the development projects.
#1 destination for IT investments. As per a recent IDC report, Punjab’s real estate market has recovered strongly over
Pune is also home to well known giants of the Indian soft- the last three quarters. The office market in Punjab has
ware industry like Wipro, Infosys, Satyam, Tata Technologies, seen an improvement as inquiries have been converted
TCS, Kanbay, Veritas, Cognizant, PCS and Mahindra British into freshly-signed leases. The vacancy rate in Class A
Telecom. A further feather in the cap is the ‘Indian Institute office has seen a dip without fresh supply, which, in turn,
of Software Engineering’ coming up in association with has pushed the rentals a little higher. The trend in the Class
Carnegie Mellon University. B secondary market is the exact opposite as the vacancy
Pune has not escaped the effects of the global slowdown, rate has gone higher due to supply of additional space that
Contact Contact has brought down the rental rate. This has further affected
with rentals decreasing in the range of 10-25% in 2010.
NAI Property Terminus NAI Space Alliance the net yield as the capital value remains stable.
Vacancy rates reached a new high, the retail market crashed
+91 20 2563 5551 +91 98 1183 4000
and the gloom of uncertainty spread fast even through the However, the trend in the retail sector has changed due to
residential sector. the change in strategies of the retailers. The retailers now
However, the market is beginning to stabilize. Lack of prefer stand-alone buildings (High Street) to the Malls
confidence in the market was replaced by vibrant buoyancy, as the conversion rate is higher in the High Street as
and a spirit of cheer and celebration prevails. Investors are compared to the malls, where there is good foot traffic but
taking advantage of the market correction and builders are the actual sales are low. Due to this change in trend, the
threatening to hike rates. Finally, the much awaited stability rentals in the stand-alone High Street areas have gone up
is having an impact. Some of the larger deals recorded in while the rentals in the malls have further corrected and
Pune were Synechron Technologies Pvt. Ltd in Embassy & the vacancy rate has increased.
Country Data Country Data
Area (Sq Mi) 1,236,085
DLF for 70,000 SF; SEZ at Hinjewadi TietoEnator at EON Area (Sq Mi) 1,236,085
The residential market has seen good demand. Due to
SEZ in Kharadi at 180,000 SF; Vodafone at EON in Yerwada recession and fluctuating property prices, property seekers
with 200,000 SF; Bajaj Allianz at Commerzone in Yerwada were shying away from making a property purchase last
at 50,000 SF; and Religare at Matrix with 100,000 SF. year, but with the improving economy and slightly stable
Construction that had been put on hold is now opening property prices, property seekers are ready to jump into
GDP 2010 (US$ B) $1,430.02 GDP 2010 (US$ B) $1,430.02
up with new developments like ZerO 1ne at Ghorpadi; the market this year both for personal use and investment
Prabhavee Tech Park, Nano Space, Amar Synergy purposes.
GDP/Capita (US$) $1,176.06 GDP/Capita (US$) $1,176.06
Connaught Road, and Amar Paradigm at Baner; and several Buoyed by the current upbeat outlook of the real estate
more. Pune’s future appears to be bright in all commercial sector coupled with favorable government support, the
property sectors. Pune is known as the Oxford of the east, emergence of a stronger real estate capital market in India
Unemployment
boasting some of the finest educational institutions, namely Unemployment
is imminent. The introduction of real estate mutual funds in
10.7% 10.7%
Rate the highly regarded Pune University. Pune is the seventh Rate coming months will substantially improve the transparency
largest metro city in India and has the highest per capita and liquidity in the sector, thus propelling a robust growth
income in the country. for both FY 2010/2011 and FY 2011/2012.
Population (Millions) 1,215.939 Population (Millions) 1,215.939
Pune At A Glance Punjab At A Glance

Conversion 44.25 INR = 1 US$ RENT/SF/MO US$ RENT/SF/YR Conversion 44.25 INR = 1 US$ RENT/SF/MO US$ RENT/SF/YR
CITY CENTER OFFICE CITY CENTER OFFICE
New Construction (AAA) INR 28.00 INR 45.00 $ 7.59 $ 12.20 40.00% New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) INR 30.00 INR 40.00 $ 8.14 $ 10.85 35.00% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) INR 30.00 INR 40.00 $ 8.14 $ 10.85 30.00% Class B (Secondary) N/A N/A N/A N/A N/A
Bulk Warehouse INR 12.00 INR 26.00 $ 3.25 $ 7.05 5.00% Bulk Warehouse INR 129.00 INR 238.00 $ 34.98 $ 64.54 17.00%
Manufacturing INR 18.00 INR 45.00 $ 4.88 $ 12.20 0.50% Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D INR 18.00 INR 45.00 $ 4.88 $ 12.20 0.50% High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown INR 70.00 INR 150.00 $ 18.98 $ 40.68 15.00% Downtown N/A N/A N/A N/A N/A
Neighborhood Service Centers INR 70.00 INR 120.00 $ 18.98 $ 32.54 20.00% Neighborhood Service Centers N/A N/A N/A N/A N/A
Community Power Center INR 70.00 INR 120.00 $ 18.98 $ 32.54 25.00% Community Power Center INR 1,110.00 INR 1,620.00 $ 301.02 $ 439.32 9.00%
Regional Malls INR 60.00 INR 100.00 $ 16.27 $ 27.12 35.00% Regional Malls INR 1,000.00 INR 1,500.00 $ 271.19 $ 406.78 20.00%
Solus Food Stores INR 100.00 INR 125.00 $ 27.12 $ 33.90 20.00% Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD INR 6,000.00 INR 8,000.00 $ 135.26 $ 180.34 Office in CBD N/A N/A N/A N/A
Land in Office Parks INR 700.00 INR 5,000.00 $ 15.78 $ 112.71 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks INR 50.00 INR 500.00 $ 1.13 $ 11.27 Land in Industrial Parks N/A N/A N/A N/A
Office/Industrial Land - Non-park INR 3,000.00 INR 10,000.00 $ 67.63 $ 225.43 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land INR 1,200.00 INR 10,000.00 $ 27.05 $ 225.43 Retail/Commercial Land N/A N/A N/A N/A
Residential INR 2,500.00 INR 8,500.00 $ 56.36 $ 191.61 Residential N/A N/A N/A N/A

Tokyo, Japan Kuala Lumpur, Malaysia
Japan’s reliance on external trade has never been more The Malaysian economy rebounded from a contraction of
obvious than now. The yen is the strongest that it has been negative 1.7% in 2009 to enjoy much better growth, which
in over 15 years and the negative effect(s) on Japan’s export is projected to end above 6% of GDP in 2010. Foreign direct
sector is having a ripple effect throughout the economy. GDP investments, contributed mainly by the manufacturing serv-
growth through the remainder of 2010 is projected to be ices sectors, improved while the real estate sector was
flat or slightly negative. driven mainly by robust domestic investments amidst low
Economic growth is expected to return in FY 2011 as interest rates below the base lending rates of about 6%.
Japan’s global trading partners, mainly the U.S. and China, With office supply expected to increase in 2011, office rents
begin to show signs of improvement on the shoulders of are not expected to show any significant increases. Developers
private-sector demand. The bid/ask spread between buyers saw opportunities to expand value-added office buildings that
and sellers remains wide for many investors. However, are MSC compliant or Green Mark certification to attract higher
increased volume is anticipated and more interesting rents. The average rents for newer Grade A buildings in Kuala
opportunities will emerge in this space as more CMBS paper Lumpur city range from RM 6.50 to RM 7.00/SF. Vacancy rates
matures and banks start taking reserves for losses, which are about 10-15%. Office transactions in 2010 included the
we believe will occur in early 2011. sale of two office buildings by UOA Holdings to UOA REIT;
The transaction market has yet to fully recover in Tokyo; Wisma UOA Damansara 2 with a net lettable area of 297,000
Contact Contact SF was sold for RM 211 million and Menara UOA Bangsar
however, there are positive signs beginning to appear. Cap
NAI Japan NAI Reapfield (Block B) with a net lettable area of 312,000 SF was sold for
rates are stabilizing, vacancy is forecasted to recover and
+81 3 5733 6513 +60 3 2713 3399 RM 289 million.
rents are also expected to hit bottom, led by the rent
stability in the Tokyo major three wards. Considering the The industrial property sector is expected to pick up as supply
market recovery of lending and forecasted GDP growth in had been stagnant for several years. The automotive, oil and
FY 2011 and 2012, land prices are expected to stabilize. gas, electrical and electronic and logistic industries are the
Average land prices fell by 3.7% nationwide and by 3.2% major drivers in this sector for larger facilities. Vacancy rates
in urban regions from the previous year. remain very low while rents have increased by about 10%
Cap rates for prime Tokyo office buildings have risen consid- and range from RM 1.20 SF to RM 1.80/SF. There was a
erably from a low of 3.5% in 2007 to 4.75% in mid-2010. strong domestic demand for smaller, niche detached and
Deal volumes have understandably fallen as the availability of semi-detached factories and prices could easily fetch RM
Country Data Country Data 250/SF and up based on location.
Area (Sq Mi)
financing has receded. The consensus amongst investors is
145,920 Area (Sq Mi) 127,724
that a reliance on cap rate compression is no longer viable, The retail sector was strong in 2010 due to sustained con-
so leasing strategies and entry pricing are key. Investors have sumer spending and improved economic conditions. Overall,
shown an increased desire to purchase new, well-located the retail subsectors grew by an average of 6%. A five-story
assets in central Tokyo, but deal volume is down considerably shopping complex with a lettable space of 300,000 SF in
GDP 2010 (US$ B) $5,390.90 and quality opportunities are few and far between. GDP 2010 (US$ B) $218.95 Kuala Lumpur city was recently refurbished and reopened
NPL acquisition volume in general has been low as financial as Fahrenheit 88 and has attained 95% occupancy.
institutions in Japan show a strong allergy towards A piece of land was recently sold at a record price of RM
collapsing their borrowers. Loans being sold are generally 7,209.80/SF on a site previously owned by Millennium &
collateralized by low-quality properties in “B” and “C” Corpthorne Hotels. The average land prices range from RM
Unemployment
locations. The lack of NPL transactions is frustrating many Unemployment
1,500 to RM 2,500/SF and are expected to exceed RM
5.1% NPL funds as it is forcing greater competition against a 3.5% 3,000/SF with continued strong interest from both local and
Rate Rate
backdrop of low-quality assets. foreign purchasers.
Interest Rate 0% Interest Rate 2.8%
Tokyo At A Glance Kuala Lumpur At A Glance

Conversion: 88.50 JPY = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 3.08 MYR = 1 US$ RENT/SF/MO US$ RENT/SF/YR
New Construction (AAA) JPY 6,020.00 JPY 8,682.00 $ 75.83 $ 109.37 4.50% New Construction (AAA) MYR 5.50 MYR 6.50 $ 21.43 $ 25.32 N/A
Class A (Prime) JPY 4,991.00 JPY 7,835.00 $ 62.87 $ 98.70 4.75% Class A (Prime) MYR 5.00 MYR 8.50 $ 19.48 $ 33.12 90.00%
Class B (Secondary) JPY 4,388.00 JPY 5,357.00 $ 55.28 $ 67.48 5.80% Class B (Secondary) MYR 3.50 MYR 4.50 $ 13.64 $ 17.53 85.00%
New Construction (AAA) JPY 4,764.00 JPY 5,876.00 $ 60.01 $ 74.02 N/A New Construction (AAA) MYR 3.50 MYR 4.50 $ 13.64 $ 17.53 N/A
Class A (Prime) JPY 3,025.00 JPY 4,538.00 $ 38.11 $ 57.16 10.10% Class A (Prime) MYR 4.00 MYR 5.00 $ 15.58 $ 19.48 90.00%
Class B (Secondary) JPY 2,118.00 JPY 3,630.00 $ 26.68 $ 45.73 18.30% Class B (Secondary) MYR 2.50 MYR 3.50 $ 9.74 $ 13.64 85.00%
Bulk Warehouse JPY 1,301.00 JPY 1,876.00 $ 16.39 $ 23.63 14.00% Bulk Warehouse MYR 1.00 MYR 1.60 $ 3.90 $ 6.23 N/A
Manufacturing N/A N/A N/A N/A N/A Manufacturing MYR 1.30 MYR 2.00 $ 5.06 $ 7.79 N/A
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D MYR 1.80 MYR 2.50 $ 7.01 $ 9.74 N/A
RETAIL RETAIL
Downtown JPY 14,006.00 JPY 16,123.00 $ 176.43 $ 203.10 N/A Downtown MYR 14.00 MYR 15.00 $ 54.55 $ 58.44 N/A
Neighborhood Service Centers JPY 3,539.00 JPY 4,099.00 $ 44.58 $ 51.63 N/A Neighborhood Service Centers MYR 7.00 MYR 20.00 $ 27.27 $ 77.92 90.00%
Community Power Center N/A N/A N/A N/A N/A Community Power Center MYR 2.50 MYR 12.00 $ 9.74 $ 46.75 95.00%
Regional Malls N/A N/A N/A N/A N/A Regional Malls MYR 20.00 MYR 30.00 $ 77.92 $ 116.88 99.00%
N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 HighM2 Low/Acre High/Acre DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD JPY 5,989,500.00 JPY 22,687,500.00 $ 273,883,434.58 $1,037,437,252.19 Office in CBD MYR 1,000.00 MYR 2,200.00 $ 324.68 $ 714.29
Land in Office Parks N/A N/A N/A N/A Land in Office Parks MYR 200.00 MYR 300.00 $ 64.94 $ 97.40
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks MYR 50.00 MYR 80.00 $ 16.23 $ 25.97
Office/Industrial Land - Non-park JPY 3,327,500.00 N/A $ 152,157,463.66 N/A Office/Industrial Land - Non-park MYR 25.00 MYR 35.00 $ 8.12 $ 11.36
Retail/Commercial Land JPY 8,902,575.00 JPY 976,725.00 $ 407,090,377.76 $ 44,662,959.79 Retail/Commercial Land MYR 350.00 MYR 500.00 $ 113.64 $ 162.34
Residential JPY 6,319,225.00 JPY 13,252,525.00 $ 288,960,855.98 $ 606,001,680.25 Residential MYR 150.00 MYR 1,500.00 $ 48.70 $ 487.01

Auckland Central, New Zealand Christchurch, New Zealand
2010 was a very interesting year in which the market rallied Christchurch has bucked the trend compared to other major city
from the impact of the global financial crisis, although centers with a greater number and increased value of significant
predictions for 2011 remain difficult to forecast. Gross sales occurring through Q3 2010 than the previous year. A
Domestic Production (GDP) has increased over the last magnitude 7.2 earthquake on Sept. 4, 2010, impacted sales
several quarters, but that growth has yet to be reflected in and leasing activity; however, major damage was mostly to older
sustainable business growth. Class C and D buildings. Longer term forecasts show positive
Activity from overseas investors has been on the rise as they signs in occupier demand as businesses involved in reconstruc-
try to grab a bargain in the New Zealand market, expecting tion projects lease additional space.
a high return on their commercial investment. The New The retail sector felt the impact of the global economic down-
Zealand currency has remained relatively strong, which has turn, with CBD retail space experiencing relatively longer
created a huge amount of inquiries from the Asia Pacific leasing cycles than in prior years. Continued expansion of
region, especially China, Singapore and Korea. Investors are suburban shopping areas resulted in major national retail tenants
looking at properties in the $500,000 to $50 million range. relocating to these shopping destinations. The CBD is well
As has become customary during this period of recession, there supported by inner city apartment developments and local
are increased pressures from institutional owners resulting in government strategic plans to increase the inner city living
a good amount of properties now available at a very attractive population.
Contact price. The good news is that while there has been an increase Contact
in distressed stock, we are seeing an increased interest on The most significant recent CBD development in the office mar-
NAI Harcourts Auckland NAI Harcourts Holmwood
most blue-ship properties throughout town. ket was the HSBC Tower completed in 2009, adding additional
Real Estate Ltd Real Estate
Class A space to the city’s inventory. The five-star, green-rated
+64 9 304 1270 Retails investment has been very popular by overseas + 64 3 378 0020
building was the first multi-level, prime quality office property to
investors during Q4 2010, and inquiries on industrial properties NAI Harcourts Grenadier be constructed in the city in almost 20 years.
are also on the rise. Market activity is definitely up, but Real Estate
banks are still hesitating to lend, resulting in a strain on property + 64 3 371 9126 Lower tenant demand and a lack of suitable land available
pricing. Historically, the leasing market begins to pick up for development over recent years resulted in the number of
around September but that didn’t happen in 2010 until early new industrial development experiencing a decline in 2010.
October. Retail leasing has been extremely active since the However, there is a significant future supply at the current
beginning of October and some good offices spaces are also expansion of Christchurch International Airport. Subdued
Country Data being leased. Confidence in the market is on the rise and was Country Data industrial development in recent years has resulted in a new
Area (Sq Mi) expected to continue. Most of the largest spaces around Area (Sq Mi)
wave of design-build inquiries in the second half of 2010.
104,428 104,428
Central Auckland are still difficult to lease, as most businesses In line with other property markets, the investment market
GDP Growth 3.0% are still recovering from the global financial crisis and are GDP Growth 3.0% softened during 2010 although activity increased late in the
very conservative about moving to a new property. year. Syndication of large commercial and industrial property
GDP 2010 (US$ B) $138.00 In general, retail leasing has been strong and overall vacancy GDP 2010 (US$ B) $138.00
to groups of investors was prevalent in 2009 and early 2010,
rates around Central Auckland are decreasing. Investors are with some substantial properties being successfully sold.
GDP/Capita (US$) $31,588.78 definitely beginning to look for properties with good tenants GDP/Capita (US$) $31,588.78 Christchurch is New Zealand’s second largest hospitality
and solid returns. The market will continue to fluctuate for center with a total of 3,939 rooms. As the international gate-
Inflation Rate 2.6% the next 12 months, but we are very confident the market is Inflation Rate 2.6% way to the South Island, the tourism market is predominantly
finally heading at the right direction. leisure (52%), followed by corporate (17%) and groups/tours
Unemployment 6.2% Unemployment 6.2% (16%). As New Zealand hosts the Rugby World Cup in
Rate Rate September and October 2011, an anticipated 85,000 visitors
Interest Rate 3.0% Interest Rate 3.0% and NZD $55 million in confirmed hotel bookings have
already been made. Christchurch is expected to be one of
Population (Millions) 4.369 Population (Millions) 4.369 the major beneficiaries of RWC 2011. New hotel construction
includes the 193-room 4.5-star Novotel, which opened in
early 2010.
Auckland Central At A Glance Christchurch At A Glance

Conversion 1.30 NZD = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 1.30 NZD = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) NZD 345.00 NZD 385.00 $ 24.65 $ 27.51 3.80%
Class A (Prime) NZD 280.00 NZD 600.00 $ 20.01 $ 42.88 10.00% Class A (Prime) NZD 245.00 NZD 295.00 $ 17.51 $ 21.08 9.90%
Class B (Secondary) NZD 150.00 NZD 350.00 $ 10.72 $ 25.01 13.00% Class B (Secondary) NZD 175.00 NZD 215.00 $ 12.51 $ 15.36 11.00%
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) N/A N/A N/A N/A N/A Class A (Prime) NZD 255.00 NZD 315.00 $ 18.22 $ 22.51 N/A
Class B (Secondary) N/A N/A N/A N/A N/A Class B (Secondary) NZD 115.00 NZD 245.00 $ 8.22 $ 17.51 N/A
Bulk Warehouse N/A N/A N/A N/A N/A Bulk Warehouse NZD 45.00 NZD 160.00 $ 3.22 $ 11.43 6.30%
Manufacturing N/A N/A N/A N/A N/A Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown NZD 1,600.00 NZD 4,000.00 $ 114.34 $ 285.85 3.50% Downtown NZD 300.00 NZD 700.00 $ 21.44 $ 50.02 N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers NZD 250.00 NZD 350.00 $ 17.87 $ 25.01 N/A
Regional Malls N/A N/A N/A N/A N/A Regional Malls NZD 300.00 NZD 1,100.00 $ 21.44 $ 78.61 N/A
Office in CBD N/A N/A N/A N/A Office in CBD NZD 1,000.00 NZD 4,000.00 $ 3,112,971.28 $ 12,451,885.14
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks NZD 140.00 NZD 200.00 $ 435,815.98 $ 622,594.26
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park NZD 150.00 NZD 290.00 $ 466,945.69 $ 902,761.67
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land NZD 380.00 NZD 1,500.00 $ 1,182,929.09 $ 4,669,456.93
Residential N/A N/A N/A N/A Residential NZD 240.00 NZD 1,100.00 $ 747,113.11 $ 3,424,268.41

Wellington, New Zealand Singapore
Wellington, the capital city of New Zealand, is located at the 2010 was an exciting year with several REIT IPOs, residential
lower end of the North Island and has a regional population cooling measures and a buoyant real estate market. Following
of 500,000 people inhabiting an area of some 813,000 2009’s V-shaped recovery, Singapore is experiencing an
hectares (2.01 million acres). The city is significantly unprecedented double-digit economic growth, bolstered by
influenced by and dependant upon the government sector, increased manufacturing orders, swelling financial services
the Crown being both the largest tenant and the largest and the opening of Marina Sands and Resort World.
employer in town. A flurry of activity in the office market began in April 2010
Office vacancy rates have increased through 2010 with a with several corporations seeking expansion. Two trends
consequent softening of rentals. Pressure on the civil service coincided during 2010 to create a “sweet spot” period from
to reduce expenditures under the center right National January to July 2010 where office tenants were able to lease
government elected in November 2008 has increased vacancies space at perhaps the lowest rental rate over the past three
as lease renewals come due. Vacancy rates will be further years. Subsequently, major landlords increased office rental
affected with office stock set to increase by some rates an additional $2/SF per month. Newer office space at
80,000 SM in the near future as new developments, with Marina Bay Financial Center and Ocean Financial Center are
tenants mostly committed pre-recession, approach completion. achieving a healthy take-up whereas older Class B buildings
Consolidation by a number of major tenants, including continue to face difficulties. The office rental market has
Contact Inland Revenue Department (IRD) and Telecom NZ, from Contact bottomed out since July 2010. The market should realize a
NAI Harcourts Team multiple locations into these new, single-site, greener build- NAI Singapore sporadic office space crunch in desired locations like Marina
Wellington Ltd ings will leave a significant amount of older space vacant. +65 6333 7738 Bay and Raffles Place in 2011, resulting in higher rental rates.
+64 4 801 5199 The largest uptake of this space is 6,151 SM vacated by the Highest achievable prime office rental rates could reach
IRD and leased to Alcatel NZ Limited at a rental that remains $13/SF per month by 2011.
confidential. In general, office vacancy rates reported as being
10% in 2009 are predicted to increase to 15% for 2010. Both local and multinational companies have been proactively
Landlords are offering significant incentives to encourage looking for more improved industrial space as inventory begins
tenants to renew existing leases. to increase and as more companies decide to owner-occupy
to capitalize on low capital value. One significant impetus is
While retail spending reportedly is flat as households gener- that JTC, Singapore’s largest industrial property owner, won’t
ally focus on debt reduction rather than the consumerism of allow tenants to sublet more than 50% of their space starting
Country Data recent years, retail vacancies on Wellington’s ‘Golden Mile’ Country Data in 2011. Industrial rental rates have shown a moderate
Area (Sq Mi) 104,428 have decreased in the last 12 months. The same is not Area (Sq Mi) 270 increase between $0.10 to $0.80/SF from 3Q 2010.
true of some secondary retail and hospitality locations where
vacancy rates now reportedly exceed 10%. There are suburban In 2010, three new retail properties: Meritus Mandarin, 111
locations where new retail developments are contemplated; Somerset Road and Park Hotel, called Knights Bridge, were
however, these will not proceed without first securing opened. Straits Trading Company announced the redevelop-
GDP 2010 (US$ B) $138.00 GDP 2010 (US$ B) $217.37
anchor tenants. In general, retail rentals have remained firm. ment of the old Specialist Center next to 313 Somerset and
However, with the recent increase in GST (value added tax) Emerald Orchard interconnected via the sky bridge across
GDP/Capita (US$) $31,588.78 GDP/Capita (US$) $42,652.76 Orchard Road. The draw of the newer malls is now centering
and rumors of retailers not renewing existing leases, we
anticipate this may not continue into 2011. on ION Orchard and 313 Somerset, resulting in the older malls
Inflation Rate 2.6% Inflation Rate 2.8% to face an increase in competition.
There have been a number of recent sales of CBD office
Unemployment buildings, several of them by mortgagees. There appears to Unemployment
The two largest investment transactions to date are the
6.2% 2.1%
Rate be no shortage of investor capital available to take advantage Rate disposal of DBS Tower by Goldman Sachs to OUE, a Lippo-
of sales at the right price however yields have softened. linked company, for $870.5 million, and Frasers’ purchase of
Starhub Center from CapitaCommercial Trust for $380 million.
Population (Millions) 4.369 Population (Millions) 5.096 Two notable IPOs are the former Prologis portfolio in China
and Japan floated by GIC, and Mapletrees’ launch of a new
REIT called Mapletree Industrial Trust.
Wellington At A Glance Singapore At A Glance

Conversion 1.30 NZD = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 1.28 SGD = 1 US$ RENT/SF/MO US$ RENT/SF/YR
New Construction (AAA) NZD 350.00 NZD 550.00 $ 25.01 $ 39.30 N/A New Construction (AAA) SGD 7.50 SGD 11.00 $ 70.31 $ 103.13 10.00%
Class A (Prime) NZD 300.00 NZD 500.00 $ 21.44 $ 35.73 N/A Class A (Prime) SGD 6.00 SGD 10.00 $ 56.25 $ 93.75 3.00%
Class B (Secondary) NZD 180.00 NZD 280.00 $ 12.86 $ 20.01 N/A Class B (Secondary) SGD 5.00 SGD 7.50 $ 46.88 $ 70.31 10.00%
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) SGD 5.00 SGD 7.00 $ 46.88 $ 65.63 15.00%
Class A (Prime) N/A N/A N/A N/A N/A Class A (Prime) SGD 4.50 SGD 6.00 $ 42.19 $ 56.25 10.00%
Class B (Secondary) NZD 150.00 NZD 280.00 $ 10.72 $ 20.01 N/A Class B (Secondary) SGD 3.50 SGD 4.50 $ 32.81 $ 42.19 15.00%
Bulk Warehouse NZD 50.00 NZD 75.00 $ 3.57 $ 5.36 N/A Bulk Warehouse N/A N/A N/A N/A N/A
Manufacturing NZD 60.00 NZD 85.00 $ 4.29 $ 6.07 N/A Manufacturing SGD 1.20 SGD 1.80 $ 11.25 $ 16.88 25.00%
High Tech/R&D NZD 100.00 NZD 120.00 $ 7.15 $ 8.58 N/A High Tech/R&D SGD 3.00 SGD 4.00 $ 28.13 $ 7.50 15.00%
RETAIL RETAIL
Downtown NZD 1,000.00 NZD 2,500.00 $ 71.46 $ 178.66 N/A Downtown SGD 22.00 SGD 50.00 $ 206.25 $ 468.75 3.00%
Neighborhood Service Centers NZD 300.00 NZD 400.00 $ 21.44 $ 28.59 N/A Neighborhood Service Centers N/A N/A N/A N/A N/A
Regional Malls N/A N/A N/A N/A N/A Regional Malls SGD 12.00 SGD 29.00 $ 112.50 $ 271.88 2.00%
DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/SF High/SF Low/Acre High/Acre
Office in CBD NZD 4,000.00 NZD 6,500.00 $ 12,451,885.14 $ 20,234,313.35 Office in CBD SGD 800.00 SGD 1,200.00 $ 27,224,811.60 $ 40,837,217.41
Land in Office Parks N/A N/A N/A N/A Land in Office Parks SGD 500.00 SGD 800.00 $ 17,015,507.25 $ 27,224,811.60
Land in Industrial Parks NZD 300.00 NZD 750.00 $ 933,891.39 $ 2,334,728.46 Land in Industrial Parks SGD 30.00 SGD 170.00 $ 1,020,930.44 $ 5,785,272.47
Office/Industrial Land - Non-park NZD 300.00 NZD 750.00 $ 933,891.39 $ 2,334,728.46 Office/Industrial Land - Non-park SGD 30.00 SGD 80.00 $ 1,020,930.44 $ 2,722,481.16
Retail/Commercial Land NZD 750.00 NZD 1,000.00 $ 2,334,728.46 $ 3,112,971.28 Retail/Commercial Land SGD 800.00 SGD 1,300.00 $ 27,224,811.60 $ 44,240,318.86
Residential NZD 30.00 NZD 1,600.00 $ 93,389.14 $ 4,980,754.06 Residential SGD 400.00 SGD 1,500.00 $ 13,612,405.80 $ 51,046,521.76

Seoul, South Korea Taipei, Taiwan
While the Korean housing market is in a deep slump due to Taipei is Taiwan's political and economic capital. Taiwan
oversupply and anticipation of a further drop in price, has recorded five straight quarters of positive economic
commercial real estate managed to stabilize in 2010. Even growth since the global financial tsunami. IMF has revised
though a generally depressed economy contributed to a Taiwan 2010 GDP growth from the original forecast of 6.5%,
decline in yields and rising vacancy rates, commercial real upward to 7.7%. In June 2010, Taiwan officially reached the
estate rents continued to experience a steady growth and ECFC (Economic Cooperation Framework Agreement) with
transaction volumes maintained those of 2009. The retail China. The signing of the ECFA boosts Taiwan and China
sector attracted investor attention and was the most active cross-strait investment.
sector in transaction volume in 2010.
Since the end of the global economic depression, the local
In the office market, new supply of prime buildings led to the real estate market has been clawing its way back from the
increase of rental and vacancy rates in the CBD during the market recession. The signing of the ECFA between Taiwan
first half of 2010. But the inflow of large tenants such as LG and mainland China has promoted a rising demand for com-
Telecom and Donkuk steel offset the vacancies. However, the mercial property. In Q3 2010, 13 large commercial property
GBD, the second largest office area in Seoul, is anticipated transactions were recorded for a total NT $23.7 million.
to suffer as a few large tenants move to other areas, resulting Transaction speed continues to accelerate.
in a surge in the vacancy rate. Meanwhile, the exit from CBD
Contact Contact Life insurers were the mainstream investors in the property
and GBD to cheaper suburban office areas continued from
last year. Given that more new construction is scheduled after market in 2010. Top high-tech companies, local developers
NAI Korea NAI Taiwan
Q4, the vacancy rate and rent are likely to increase in 2011. and companies from traditional sectors and the hotel industry
+82 2 6205 3500 + 886 2 8770 6699
have all expressed interest and optimism towards the great
The least affected sector from the depressed economy of value of long term ownership of Taiwan properties. Potential
2010 has been the retail market. Investors, disappointed by buyers have embarked in having a piece of the commercial
a very weak housing market, expressed high interest in retail property pie.
markets resulting in a rise in transaction volume. In addition,
aggressive expansion of buoyant industries such as coffee, The overall net absorption in the Taipei office market in the
cosmetics and fashion lowered vacancies. The vacancy rate CBD registered 32,102 pings (1.14 million SF), lowering the
decreased five consecutive quarters while the rent, especially overall vacancy rate to 15.75%. Net absorption in 2010
in downtown, rose to very high levels. The growing new exceeded the previous year’s levels in both the downtown
Country Data construction of retail facilities shows that the retail market Country Data and suburban office markets. Net absorption in the downtown
Area (Sq Mi) is expected to continue with strong activity into 2011. Area (Sq Mi)
area was 11,519 pings (409,846 SF) and the suburban area
38,544 13,972
was 20,583 pings (732,343). Most of the vacancy rates in
Industrial demand fell sharply in 2010 due to the depressed the Taipei CBD declined in 2010. To improve cost efficiency,
GDP Growth 6.1% real estate market. The rent remained stabilized but sale GDP Growth 9.3%
quite a few companies in the technology sector relocated
prices declined steadily. Even though transaction volume their offices from downtown areas to the suburban area. After
GDP 2010 (US$ B) $986.26 contracted, relocation of manufacturing was very active while GDP 2010 (US$ B) $426.98
the signing of ECFA at the end of June 2010, commercial
high-tech facilities suffered from oversupply and lack of new property is forecast to heat up due to an optimistic look at
GDP/Capita (US$) $20,164.85 business establishments. Continuing demand for leased GDP/Capita (US$) $18,303.60 the amount of new demand and a trend in increased values.
space and shrinking investor demand are expected to
continue in 2011. Institutional investors have carried on with increased
purchase activity in Taipei’s commercial property market. De-
The investment sector remained stable in terms of transaction spite the benchmark interest rate raised by the Central Bank
Unemployment 3.3% volume and size. Prices for office buildings fell in Q1 but saw Unemployment 5.3%
Rate Rate in June, there was sufficient capital flow in the market and
a slight rise in Q2 and the upward trend is expected to con- a limited new supply of properties in the office market. Cross-
Interest Rate 2.3% tinue for the next several months. Private investors and com- Interest Rate 1.3%
strait business activities are increasingly more active today.
panies seeking corporate offices led the investment market It is anticipated to boost the commercial property market,
Population (Millions) 48.91 despite the economic crisis while institutional investors and Population (Millions) 23.328
both in volumes and price.
foreign investors continued to observe from the sidelines. The
large-scale, overseas real estate investment of national
pensions will continue in 2011.
Seoul At A Glance Taipei At A Glance
Conversion 1125.30 KRW = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 30.42 TWD = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) KRW 381,140.00 KRW 453,700.00 $ 31.47 $ 37.46 N/A New Construction (AAA) TWD 756.25 TWD 1,058.75 $ 27.71 $ 38.80 34.50%
Class A (Prime) KRW 315,800.00 KRW 352,100.00 $ 26.07 $ 29.07 4.00% Class A (Prime) TWD 559.63 TWD 1,058.75 $ 20.51 $ 38.80 15.60%
Class B (Secondary) KRW 246,800.00 KRW 308,540.00 $ 20.38 $ 25.47 6.50% Class B (Secondary) TWD 499.13 TWD 635.25 $ 18.29 $ 23.28 14.70%
New Construction (AAA) KRW 137,940.00 KRW 163,360.00 $ 11.39 $ 13.49 N/A New Construction (AAA) TWD 378.13 TWD 408.38 $ 13.86 $ 14.97 42.20%
Class A (Prime) KRW 116,160.00 KRW 137,940.00 $ 9.59 $ 11.39 6.20% Class A (Prime) TWD 347.88 TWD 438.63 $ 12.75 $ 16.07 12.30%
Class B (Secondary) KRW 108,900.00 KRW 116,160.00 $ 8.99 $ 9.59 7.40% Class B (Secondary) TWD 272.25 TWD 363.00 $ 9.98 $ 13.30 19.60%
Bulk Warehouse N/A N/A N/A N/A N/A Bulk Warehouse TWD 181.50 TWD 302.50 $ 6.65 $ 11.09 22.20%
Manufacturing KRW 108,900.00 KRW 181,500.00 $ 8.99 $ 14.98 1.50% Manufacturing TWD 181.50 TWD 302.50 $ 6.65 $ 11.09 17.00%
High Tech/R&D KRW 108,900.00 KRW 181,500.00 $ 8.99 $ 14.98 2.20% High Tech/R&D TWD 272.25 TWD 363.00 $ 9.98 $ 13.30 15.10%
RETAIL RETAIL
Downtown KRW 1,820,000.00 KRW 3,500,000.00 $ 150.26 $ 288.95 2.00% Downtown TWD 1,815.00 TWD 7,562.50 $ 66.52 $ 277.15 2.50%
Neighborhood Service Centers KRW 545,000.00 KRW 1,090,000.00 $ 44.99 $ 89.99 8.00% Neighborhood Service Centers TWD 907.50 TWD 1,512.50 $ 33.26 $ 55.43 7.80%
Community Power Center KRW 464,000.00 KRW 663,000.00 $ 38.31 $ 54.74 10.00% Community Power Center TWD 453.75 TWD 907.50 $ 16.63 $ 33.26 8.30%
Regional Malls KRW 261,000.00 KRW 460,000.00 $ 21.55 $ 37.98 15.00% Regional Malls TWD 756.25 TWD 1,058.75 $ 27.71 $ 38.80 5.30%
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores TWD 453.75 TWD 605.00 $ 16.63 $ 22.17 13.70%
Office in CBD KRW 30,250,000.00 KRW 45,375,000.00 $108,786,630.91 $163,179,946.36 Office in CBD N/A N/A N/A N/A
Land in Office Parks N/A N/A N/A N/A Land in Office Parks TWD 363.00 TWD 605.00 $ 48,290.96 $ 80,484.94
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks TWD 121.00 TWD 181.50 $ 16,096.99 $ 24,145.48
Residential N/A N/A N/A N/A Residential N/A N/A N/A N/A

Canada
SECTION CONTENTS
Calgary, Alberta, Canada
Edmonton, Alberta, Canada
Vancouver, British Columbia, Canada
Victoria, British Columbia, Canada
Halifax, Nova Scotia, Canada
Ottawa, Ontario, Canada
Toronto, Ontario, Canada
Montréal, Quebec, Canada
Regina, Saskatchewan, Canada
41
Calgary, Alberta, Canada Edmonton, Alberta, Canada
Calgary is the largest metropolitan city in the province of Edmonton is positioned as the Gateway to the North, the
Alberta, located in the south central part of the province. largest key metropolitan area to Canada’s oil industry. In 2010
Calgary is known as the gateway to the Rockies (the Rocky businesses and the media emphasized caution while in the
Mountains), which are located approximately one hour west background the interest and capital to be invested here was
of Calgary. The city’s dominant economic drivers are the reason for continued optimism. The Conference Board of
oil and gas/energy sector and related technology sectors. Canada predicts a continued rebound for Edmonton’s GDP
Calgary is home to more corporate headquarters per capita from a contraction of 5.1% in 2009 to growth of 3.8% in
than any other city in Canada. 2010 and projected 4.0% in 2011.
Over the past 10 years, Calgary has experienced a 46.2% It is hard to understand the realities and economic impact of
growth in the number of companies locating their headquarters a provincial total of $228.8 billion in major project investment
here. Approximately 114 Calgary-based companies are in the (recent and announced), where oil and gas make up 77.7%.
Fortune 500, 10 of which are the top 50 in Canada. Calgary is The commercial investment market has seen a flurry of
home to corporate headquarters including Encana, Suncor, activity in terms of large sales with minimal single investment
Petro Canada, Trans Canada Pipeline, Westjet, Forzani’s, sales. Smaller owners have been reluctant to sell their build-
etc. Calgary is also a distribution hub for western Canada ings as they have few alternatives to provide a more favorable
located on intersecting major Canadian Highways, including and secure return.
Contact the Trans Canada Highway. Calgary, the third largest Contact
metropolitan city in Canada, has a population approaching Office vacancies have increased from 6.45% in 2009
NAI Commercial Calgary NAI Commercial Edmonton
1.1 million people. to 7.13% through 2010. The large amount of sublease
+1 403 214 2344 +1 780 436 7410
vacancy, which could add 1.5% to the noted amount, and
Calgary’s office market is relatively large when compared new unimproved space that became available throughout
to the size of the city, boasting over 36 million SF of office 2010 caused the vacancy rates to increase from the steady
space in downtown Calgary and an additional 20 million SF decline in previous years. Rental rates in those areas adjusted
in the suburbs. Currently the vacancy rate for office space accordingly to compete with the sublease availabilities.
over the entire market is 14% with several large office building Edmonton’s retail vacancy continues to maintain its perform-
developments still coming to market over the next 12 to ance with a vacancy rate of 2.66% in 2010, versus 2.96%
18 months. in 2009.
The industrial market has been rapidly growing to try and The industrial market vacancy rate was 2.94% for 2010
Country Data meet demand. There has been no speculative construction, Country Data
versus 1.92% for 2009. However, in 2010 it was reported
although demand for large bulk warehouse has incremen-
there was an additional 1.75% of industrial vacancy by way
Area (Sq Mi) 3,855,100 tally increased in Calgary. The manufacturing sector has re- Area (Sq Mi) 3,855,100
of sublease or occupied space being marketed as available.
mained steady while the smaller, oil and gas related
There has been a significant slowdown in small bay activity
GDP Growth 3.1% technology sector, has increased. Landlords, tenants and GDP Growth 3.1%
with tenants being reluctant to commit in what they consider
investors are optimistic and expect this sector to remain
uncertain times. The number of large vacancies (10,000 SF+)
GDP 2010 (US$ B) $1,563.66 strong into 2011. GDP 2010 (US$ B) $1,563.66 has increased as well as the sublease availability. With
The retail market has not seen as wide ranging variations softening lease rates from previous years, many tenants still
GDP/Capita (USD) $45,887.74 in vacancy, absorption or construction activity and has GDP/Capita (USD) $45,887.74 continue to relocate or take advantage of the lowered activity.
remained much more stable than the aforementioned office Industrial land has also seen a small moderation in price.
Inflation Rate 1.8% market. Retail growth remains steady, and is beginning to Inflation Rate 1.8% A sampling of sales of parcels from 1-5 acres in 2010
gain momentum. New construction is expected to signifi- shows an average price of $512,820/acre versus $677,083
Unemployment 8.0%
cantly increase late in 2011. Unemployment 8.0% in 2009.
Rate The land market is going through a significant change with Rate
The Edmonton region has suffered less through the downturn
much of the leveraged land being foreclosed on and sold than other markets. Optimism is tempered with one eye
Interest Rate 1.0% at significantly discounted values, setting the stage for a Interest Rate 1.0%
focused on the continuing uncertainty worldwide and the
more balanced market going forward. Sales volume recent reminder of the difficulties created from an over-
Population (Millions) 34.076 and transaction counts are expected to remain below Population (Millions) 34.076 stimulated economy.
the historical average in 2010.
Calgary At A Glance Edmonton At A Glance
Conversion 1.01 CAD = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR Conversion 1.01 CAD = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR
New Construction (AAA) CAD 25.00 CAD 40.00 $ 24.75 $ 39.60 14.40% New Construction (AAA) CAD 26.00 CAD 35.00 $ 25.74 $ 34.65 7.10%
Class A (Prime) CAD 20.00 CAD 30.00 $ 19.80 $ 29.70 12.80% Class A (Prime) CAD 22.00 CAD 30.00 $ 21.78 $ 29.70 7.10%
Class B (Secondary) CAD 12.00 CAD 22.00 $ 11.88 $ 21.78 18.20% Class B (Secondary) CAD 13.00 CAD 22.00 $ 12.87 $ 21.78 7.10%
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) CAD 23.00 CAD 26.00 $ 22.77 $ 25.74 7.10%
Bulk Warehouse CAD 4.00 CAD 8.00 $ 3.96 $ 7.92 N/A Bulk Warehouse CAD 5.00 CAD 9.75 $ 4.95 $ 9.65 2.90%
Manufacturing CAD 5.00 CAD 10.00 $ 4.95 $ 9.90 N/A Manufacturing CAD 5.00 CAD 11.00 $ 4.95 $ 10.89 2.90%
High Tech/R&D CAD 6.00 CAD 15.00 $ 5.94 $ 14.85 N/A High Tech/R&D CAD 5.00 CAD 11.00 $ 4.95 $ 10.89 2.90%
RETAIL RETAIL
Downtown CAD 20.00 CAD 100.00 $ 19.80 $ 99.01 N/A Downtown CAD 18.00 CAD 37.00 $ 17.82 $ 36.63 2.70%
Neighborhood Service Centers CAD 12.00 CAD 30.00 $ 11.88 $ 29.70 N/A Neighborhood Service Centers CAD 16.00 CAD 32.00 $ 15.84 $ 31.68 2.70%
Community Power Center CAD 12.00 CAD 25.00 $ 11.88 $ 24.75 N/A Community Power Center CAD 24.00 CAD 35.00 $ 23.76 $ 34.65 2.70%
Regional Malls CAD 25.00 CAD 140.00 $ 24.75 $ 138.61 N/A Regional Malls CAD 30.00 CAD 125.00 $ 29.70 $ 123.76 2.70%
DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre
Office in CBD CAD 4,000,000.00 CAD 13,000,000.00 $ 3,960,396.04 $ 12,871,287.13 Office in CBD N/A N/A N/A N/A
Land in Office Parks CAD 700,000.00 CAD 1,200,000.00 $ 693,069.31 $ 1,188,118.81 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks CAD 250,000.00 CAD 600,000.00 $ 247,524.75 $ 594,059.41 Land in Industrial Parks CAD 200,000.00 CAD 550,000.00 $ 198,019.80 $ 544,554.46
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park CAD 250,000.00 CAD 650,000.00 $ 247,524.75 $ 643,564.36
Retail/Commercial Land CAD 600,000.00 CAD 1,200,000.00 $ 594,059.41 $ 1,188,118.81 Retail/Commercial Land CAD 300,000.00 CAD 1,000,000.00 $ 297,029.70 $ 990,099.01
Residential CAD 100,000.00 CAD 6,000,000.00 $ 99,009.90 $ 5,940,594.06 Residential CAD 65,000.00 CAD 850,000.00 $ 64,356.44 $ 841,584.16

Vancouver, British Columbia, Canada Victoria, British Columbia, Canada
Vancouver is the largest city in British Columbia and the third Victoria, British Columbia, has five primary economic drivers
largest in Canada. Metro Vancouver is home to 2.4 million peo- that include the provincial seat of government, the University
ple. It is one of the largest ports on the west coast and the of Victoria, high technology, tourism and the Department of
gateway to Asia. Strong commodity prices in 2010 have National Defense, which operates Canada’s largest naval
underpinned a V-shape economic recovery in the region. The base on the Pacific coast. Since autumn 2008 when the
commercial property market is experiencing normal conditions financial crisis swept across North America and the rest of
with good supply-demand characteristics. Average cap rates the world, two of the major economic drivers, government
are mostly below 7% regardless of product type. revenue and tourism, have been negatively impacted.
The overall vacancy rate in the office market moved up from The office market has seen a further increase in vacancy
7% to 8% in 2010 despite the recovery through 2010. This rates across all asset classes and areas. A notable impact
was due to new supply, primarily in the suburbs. The outlook on the downtown office market has been the downsizing of
for the office market is positive for 2011, especially in the provincial government offices because of budget restrictions
CBD where little new supply is expected in the near term. and some consolidation of government departments into
Vacancy in the CBD is again below 5%. new Class A space. With limited new supply and stable
The industrial market was stable with modest transaction private sector activity, the overall office vacancy rate is
activity in 2010. The average vacancy rate was approxi- expected to remain under 5% (4.7% for downtown Class A
Contact Contact space) with lease rates under some downward pressure but
mately 4.5% which should remain unchanged through
NAI Commercial 2011. Land prices have firmed although not back to levels NAI Commercial Victoria overall unchanged from 2010.
Vancouver experienced in 2007. Land prices range between $850,000 +1 250 381 2265 The industrial market continues to be a challenge for buyers
+1 604 691 6643 and $1.2 million/acre. Rental rates average $8.00/SF for and tenants with an extremely low vacancy rate (under 2%),
typical industrial product. Increasing levels of confidence in steady absorption and limited new supply. The land values
the economy is starting to drive tenant expansions. Owner- have remained unchanged and there has been some defla-
users have been active buyers of industrial strata product, tion in construction costs which contribute to more stable
taking advantage of the continuing low interest rates. industrial rent. Due to lack of additional capacity in existing
The retail market was active throughout the region, espe- industrial areas, growing businesses continue to look for
cially near rapid-transit lines. Market rents and occupancy expansion options outside Victoria.
have been stable. The investment appetite for retail has The retail market in the Central Business District continues
Country Data been strong. REITs have raised substantial equity capital in Country Data to show compression due to a weakened tourism sector.
2010 and they have been active investors in this sector. However, the 8% vacancy rate is expected to hold steady.
Area (Sq Mi) 3,855,100 Area (Sq Mi) 3,855,100 Regional and community retail centers in Greater Victoria
The investment market has returned to near normal trans-
action volumes. REITs are flush with cash. Institutional have maintained a healthy 2-3% vacancy rate with lease
GDP Growth 3.1%
owners are rebalancing portfolios and high-net worth GDP Growth 3.1% rates remaining stable. Morguard Investments, a Canadian
investors continue to be attracted to this supply constrained Pension Fund, completed Phase I of its ambitious Uptown
GDP 2010 (US$ B) $1,563.66 west coast market. GDP 2010 (US$ B) $1,563.66 development on the site of a pre-existing suburban mall
called Town & Country. The new mall is anchored by a
The multifamily market is particularly strong with cap rates Walmart Superstore with a complementary mix of big and
GDP/Capita (USD) $45,887.74 GDP/Capita (USD) $45,887.74
below 5% in most submarkets in the city and between 5% mid-box retail stores.
and 6% in the suburban areas. Transaction activity for 2010
Inflation Rate 1.8% was steady with improvement expected in 2011 resulting Inflation Rate 1.8% The significant office component of some 200,000 SF of
from continued low interest rates and population growth in Class A space remains largely vacant and a difficult sell in this
Unemployment 8.0% the region. Unemployment 8.0% office market. The investment market in Greater Victoria
Rate Rate continues to be limited due to lack of product. The over-supply
The Vancouver region will continue to be an attractive place of qualified purchasers chasing the limited number of
Interest Rate 1.0%
to locate a business or own commercial property. The Interest Rate 1.0% investment-grade properties that come to market has kept
economic outlook for 2011 is favorable with low inflation, cap rates down. Cap rates on prime commercial properties
employment growth and continued low interest rates in the have stabilized at 6% to 7% with multifamily apartments
forecast. All positive indicators for tenants and landlords alike. unchanged at around 5%, up from 4.25% pre-recession.
Vancouver At A Glance Victoria At A Glance
Bulk Warehouse CAD 6.00 CAD 9.00 $ 5.94 $ 8.91 4.50% Bulk Warehouse CAD 10.00 CAD 12.00 $ 9.90 $ 11.88 1.50%
Manufacturing CAD 6.50 CAD 10.00 $ 6.44 $ 9.90 4.50% Manufacturing CAD 12.00 CAD 14.00 $ 11.88 $ 13.86 1.50%
High Tech/R&D CAD 8.50 CAD 14.00 $ 8.42 $ 13.86 5.00% High Tech/R&D CAD 12.00 CAD 18.00 $ 11.88 $ 17.82 1.50%
RETAIL RETAIL
Downtown CAD 40.00 CAD 100.00 $ 39.60 $ 99.01 5.00% Downtown CAD 38.00 CAD 90.00 $ 37.62 $ 89.11 8.00%
Neighborhood Service Centers CAD 30.00 CAD 60.00 $ 29.70 $ 59.41 5.00% Neighborhood Service Centers CAD 26.00 CAD 32.00 $ 25.74 $ 31.68 5.00%
Community Power Center CAD 30.00 CAD 40.00 $ 29.70 $ 39.60 5.50% Community Power Center CAD 24.00 CAD 28.00 $ 23.76 $ 27.72 2.00%
Regional Malls CAD 25.00 CAD 40.00 $ 24.75 $ 39.60 6.00% Regional Malls CAD 50.00 CAD 70.00 $ 49.50 $ 69.31 3.00%
DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre
Office in CBD CAD 3,267,000.00 CAD 5,880,000.00 $ 3,234,653.47 $ 5,821,782.18 Office in CBD CAD 1,500,000.00 CAD 2,000,000.00 $ 1,485,148.51 $ 1,980,198.02
Land in Office Parks CAD 900,000.00 CAD 1,200,000.00 $ 891,089.11 $ 1,188,118.81 Land in Office Parks CAD 600,000.00 CAD 1,000,000.00 $ 594,059.41 $ 990,099.01
Land in Industrial Parks CAD 850,000.00 CAD 1,200,000.00 $ 841,584.16 $ 1,188,118.81 Land in Industrial Parks CAD 500,000.00 CAD 750,000.00 $ 495,049.50 $ 742,574.26
Office/Industrial Land - Non-park CAD 750,000.00 CAD 1,100,000.00 $ 742,574.26 $ 1,089,108.91 Office/Industrial Land - Non-park CAD 600,000.00 CAD 900,000.00 $ 594,059.41 $ 891,089.11
Retail/Commercial Land CAD 750,000.00 CAD 1,300,000.00 $ 742,574.26 $ 1,287,128.71 Retail/Commercial Land CAD 1,000,000.00 CAD 1,500,000.00 $ 990,099.01 $ 1,485,148.51
Residential CAD 750,000.00 CAD 1,300,000.00 $ 742,574.26 $ 1,287,128.71 Residential CAD 400,000.00 CAD 1,000,000.00 $ 396,039.60 $ 990,099.01

Halifax, Nova Scotia, Canada Ottawa, Ontario, Canada
Founded in 1749, Halifax is one of the oldest cities in Canada. The federal government's steady growth and voracious
It is the capital city of Nova Scotia and the economic center appetite for office space has turned Ottawa into one of the
for Canada’s East Coast. This port city has six universities and strongest office real estate markets in North America. With
many federal government offices, and is home to a large rock bottom vacancy rates, the investment and pension funds
concentration of educational, medical and research facilities. that dominate the office market can't get enough of the city,
Halifax’s office market is maintaining a healthy status quo. sheltered as it is by its biggest employer landlord and tenant,
While the vacancy rate has increased from 7.43% in 2009 the government.
to 7.63% in 2010, overall it remains below 8% for the fifth After a decade of growth, the government is looking for a
straight year. We anticipate that the overall vacancy will massive 4.1 million SF of office space over the next five
increase to 8.73% in the next year, driven by increases in years, and is currently building five new office towers across
supply of rental space. As landlords have a harder time the region. In addition, they have just announced the acqui-
finding tenants, the net absolute rent per SF will fall slightly. sition of the 2.2 million SF Nortel campus in Ottawa’s west
Although several office building projects have been approved end from the receivers of Nortel. While the downtown has
for Halifax’s CBD, construction has not yet commenced. The seen some large vacancies arise, vacancy rates remain within
current net absolute rental rates are $17.01/SF for Class A, reasonable levels. However, the new developments and
$13.06/SF for Class B and $10.87/SF for Class C; or construction will loosen vacancy rates and rein in rents.
Contact $13.28/SF overall. Space available for sublease has risen in Contact
Ottawa’s investors and developers are continuing this trend
NAI Turner Drake the downtown area. NAI Commercial Ottawa
in the multifamily market as well. Vacant land parcels and
& Partners Ltd. +1 613 230 2100
HRM (Halifax Regional Municipality) industrial properties have parking lots are shrinking in the core and nearby Centretown
+1 902 429 1811
the highest overall net rental rates of all the major centers in with new multifamily developments being promoted. The hype
the Maritimes at $7.04/SF. Overall vacancy rate is 6.72% and surrounding the downtown revival is adding to the buzz about
we anticipate this vacancy rate will fall to 5.74%. There will redevelopment at Lansdowne Park, where the city is in the
be a slight corresponding increase in the net absolute rent. process of finalizing the project.
Halifax Logistics Park is located in Burnside, the largest One of the most immediate and measurable signs of life is in
business park north of Boston and east of Montreal with over the redevelopment of Ottawa’s convention center. Construction
1,500 enterprises. Phase 1 of the park has already attracted on the new center is already progressing as the glass exterior
large anchor tenants engaged in transloading, distribution takes form. Reports from the center’s management indicate
Country Data and warehouse activities. Country Data
that bookings have increased and revenue projections are
On the retail front, Halifax Shopping Centre and Mic Mac Mall Area (Sq Mi) 3,855,100
ahead of schedule. The completion and success of a new
Area (Sq Mi) 3,855,100
are the two largest regional malls in Nova Scotia. Both malls convention center may be seen as an initial indicator of
are competing for national retailers expanding into this the new life that is being developed and redeveloped in the
market. Coach and Gymboree have recently opened in Halifax downtown core and surrounding areas.
Shopping Centre and H&M opened in Mic Mac Mall this year. In sales volume, the first six months of 2010 compared
GDP 2010 (US$ B) $1,563.66 BCBG Max Azria will also be open for business in 2010. GDP 2010 (US$ B) $1,563.66
favorably to the active market of 2009. Demand for vacant
Dartmouth Crossing continues to expand its retail park, land remains strong, representing almost one-third of all
GDP/Capita (USD) $45,887.74 although several smaller tenants have found the location GDP/Capita (USD) $45,887.74
sales volume. Industrial sales have been weaker; however,
challenging and have closed. there have been several large packages that are being
Multifamily properties continue to be the choice in the invest- marketed that will affect volume by year end. It will be
ment market. Office and industrial product trades are few and interesting to see how the total year unfolds as there appears
Unemployment 8.0% far between as landlords are holding onto their investments. Unemployment 8.0% to be more liquidity in the market and Ottawa is a preferred
Rate Rate
location to invest.
Halifax At A Glance Ottawa At A Glance

New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) N/A N/A N/A N/A N/A
New Construction (AAA) CAD 22.00 CAD 26.00 $ 21.78 $ 25.74 3.30% New Construction (AAA) N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown CAD 33.00 CAD 60.00 $ 32.67 $ 59.41 N/A Downtown CAD 20.00 CAD 50.00 $ 19.80 $ 49.50 2.10%
Neighborhood Service Centers CAD 26.53 CAD 29.03 $ 26.27 $ 28.74 N/A Neighborhood Service Centers CAD 20.00 CAD 50.00 $ 19.80 $ 49.50 3.50%
Community Power Center CAD 27.50 CAD 31.50 $ 27.23 $ 31.19 N/A Community Power Center CAD 20.00 CAD 50.00 $ 19.80 $ 49.50 3.50%
Regional Malls CAD 68.00 CAD 95.00 $ 67.33 $ 94.06 N/A Regional Malls CAD 20.00 CAD 50.00 $ 19.80 $ 49.50 5.00%
Office in CBD N/A N/A N/A N/A Office in CBD CAD 17,000,000.00 CAD 17,000,000.00 $ 16,831,683.17 $16,831,683.17
Land in Office Parks CAD 326,700.00 CAD 392,040.00 $ 323,465.35 $ 388,158.42 Land in Office Parks CAD 350,000.00 CAD 400,000.00 $ 346,534.65 $ 396,039.60
Office/Industrial Land - Non-park CAD 130,680.00 CAD 196,020.00 $ 129,386.14 $ 194,079.21 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land CAD 1,118,620.00 CAD 4,272,290.00 $1,107,544.55 $ 4,229,990.10 Retail/Commercial Land CAD 350,000.00 CAD 2,000,000.00 $ 346,534.65 $ 1,980,198.02
Residential CAD 1,559.00 CAD 4,779.00 $ 1,543.56 $ 4,731.68 Residential CAD 375,000.00 CAD 3,000,000.00 $ 371,287.13 $ 2,970,297.03

Toronto, Ontario, Canada Montreal, Quebec, Canada
Toronto is North America’s fifth largest city and Canada’s Enjoying a strategic position within North America, Montreal
largest economic center. Canada is the best positioned is a genuine international business center, one that forms a
country in the G7, with the healthiest banking sector. With bridge between the economy of the European Union and
a population of approximately 5.9 million people, Toronto that of the U.S. Montreal has not suffered excessively from
is home to one-sixth of Canada’s workforce. As Canada’s the worldwide recession that dominated the market in 2009.
center for commerce, Toronto is the hub of the banking and Classed among the 20 largest cities in North America, it
investment community and acts as the gateway for other appears that Montreal is a city that has been able to weather
major industries in Canada including, medical, film, tourism, the crisis with very little damage.
fashion, food and information technology. The city of Montreal is ranked second in North America with
Currently there is approximately 170 million SF of office respect to jobs related to the design and production of video
space available in the Greater Toronto Area, 69 million SF games. Electronic Arts, Ubisoft and recently the videogame
of this space located in Downtown Toronto. The current publisher THQ Montreal have offices located in the city in
vacancy rate for Downtown Toronto is 7.5%, the Financial order to benefit from Montreal`s multi-lingual workforce,
Core having a vacancy rate of 6.6%. Toronto’s downtown quality of life and the province's aggressive tax incentives.
office market within the financial core has seen a recent The city is also a major center for corporations operating in
increase of inventory with the addition of over 3 million SF. the aerospace, pharmaceutical and biotechnology fields, and
Contact The following new trophy office buildings have recently Contact a leader in electronic commerce, multimedia production and
NAI Ashlar Urban been completed: Bay Adelaide Centre, Maple Leaf Square, NAI Commercial information technology. The film industry also continues to
+1 416 205 9222 RBC Centre and Telus Tower. These buildings consist +1 514 866 3333 thrive in Montreal.
primarily of tenants who have recently relocated from within The market for office space in the greater Montreal area
the downtown core. Gross rent in Downtown Toronto is represents more than 21% of the entire Canadian market.
currently $35/SF, with the Financial Core experiencing rates The total inventory in this market is more than 72 million
of $42/SF. SF, 60% of which is in the downtown core. Despite the
Canada’s unemployment rate as of October 2010 is 8.0% global recession, the Montreal office market has maintained
which is 0.10% less than September 2010. Monthly GDP a healthy vacancy rate of 9.3%. Although no major devel-
is currently growing at 0.3% as per Statistics Canada for opment projects in the core have begun construction, the
August 2010. Annual inflation is currently trailing at 1.9% suburban markets such as Laval and the South Shore, have
Country Data as of October 2010. A stable, transparent and safe country Country Data had better than expected growth. The hotel sector in
for investment, recently many off shore investment funds Montreal continues to grow with several new projects under
Area (Sq Mi) 3,855,100 have been looking for entry into the Toronto market. Area (Sq Mi) 3,855,100 way in conjunction with the recent redevelopment of the
Additionally, Toronto has been very forward thinking in terms Quartier-des-Spectacles (Concert district).
of its environmental standards. All major new developments There is approximately 326.5 million SF of leasable indus-
in the next 24 months have been registered for LEED trial space in the greater Montreal area. The vacancy rate
GDP 2010 (US$ B) $1,563.66 GDP 2010 (US$ B) $1,563.66
certification and smaller developments are starting to bring in the industrial sector is 7%. The majority of unoccupied
a new generation of “green buildings” to market. New space is found in older buildings with lower clear heights,
GDP/Capita (USD) $45,887.74 energy alternatives such as deep lake water cooling (DLWC) GDP/Capita (USD) $45,887.74 with more recent buildings offering greater clear heights.
have been embraced by some of the major new develop- However, industrial development has been slow, keeping
Inflation Rate 1.8% ments in Toronto (such as the Telus Tower and the RBC Inflation Rate 1.8% demand steady with the expectation of an improvement in
Centre) and it is the city of Toronto’s objective to have 80% the world economy in 2011.
Unemployment 8.0% of the downtown core connected to Enwave Energy Corp.’s Unemployment 8.0%
Montreal has made its mark this year by implementing its
Rate DLWC network by 2050. Rate
BIXI program, a bicycle transportation system offering over
6,000 bicycles at some 400 locations in the downtown core
and adjacent suburbs. This innovative project is now being
exported to other major cities such as London and Boston.
Toronto At A Glance Montreal At A Glance

New Construction (AAA) CAD 12.00 CAD 25.00 $ 11.88 $ 24.75 9.00% New Construction (AAA) CAD 20.00 CAD 22.00 $ 19.80 $ 21.78 N/A
RETAIL RETAIL
Downtown CAD 25.00 CAD 300.00 $ 24.75 $ 297.03 8.00% Downtown CAD 65.00 CAD 200.00 $ 64.36 $ 198.02 9.00%
Neighborhood Service Centers CAD 25.00 CAD 40.00 $ 24.75 $ 39.60 9.00% Neighborhood Service Centers CAD 10.00 CAD 25.00 $ 9.90 $ 24.75 16.00%
Community Power Center CAD 22.00 CAD 45.00 $ 21.78 $ 44.55 6.00% Community Power Center CAD 16.00 CAD 28.00 $ 15.84 $ 27.72 19.00%
Regional Malls CAD 40.00 CAD 120.00 $ 39.60 $ 118.81 5.00% Regional Malls CAD 35.00 CAD 60.00 $ 34.65 $ 59.41 17.00%
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores CAD 20.00 CAD 26.00 $ 19.80 $ 25.74 6.10%
Office in CBD N/A N/A N/A N/A Office in CBD CAD 240,000.00 CAD 480,000.00 $ 237,623.76 $ 475,247.52
Land in Office Parks CAD 450,000.00 CAD 999,000.00 $ 445,544.55 $ 989,108.91 Land in Office Parks CAD 200,000.00 CAD 400,000.00 $ 198,019.80 $ 396,039.60
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park CAD 160,000.00 CAD 480,000.00 $ 158,415.84 $ 475,247.52
Retail/Commercial Land CAD 390,000.00 CAD 1,000,000.00 $ 386,138.61 $ 990,099.01 Retail/Commercial Land CAD 600,000.00 CAD 3,000,000.00 $ 594,059.41 $ 2,970,297.03
Residential N/A N/A N/A N/A Residential CAD 600,000.00 CAD 3,000,000.00 $ 594,059.41 $ 2,970,297.03

Regina, Saskatchewan, Canada
The Saskatchewan market remains very strong and is
expected to experience continued steady growth well into
2011 supported by strong commodity prices. Look for rates
in all sectors to continue steadily upward as demand, low
vacancy rates and a lack of new product will naturally force
rates upward into 2012.
The strong Saskatchewan economy has proven to be a real
positive for the retail market. The Grasslands project in the
southeast corner of the city is an exciting new development

that will shift the retail and will attract new and exciting
retailers to the city. Modest growth in the east and northwest
sectors will continue with all other areas maintaining both
rental and vacancy rates.
The Regina office market has enjoyed a historically low
Contact
vacancy rate, below 3% in most asset categories. The
construction of a new office tower will add 200,000 SF to the
market in 2012. Plans are also under way for an 80,000 SF

NAI Commercial
downtown office building. Rental rates continue to rise as the
(SASK)
difference between new construction and the existing, shrink-
+1 306 525 3344
ing supply becomes more apparent. Look for continued
strength into 2012.
The Regina industrial market is beginning a marked change
as a result of the investment in the intermodal project on
the city's west side. Westfair Foods is well under way with a
1 million SF facility, with over 300 to 400 new jobs being

created with this project alone. Industrial lease rates remain
Country Data strong with rates approaching $10.00/SF for warehouse
space and $12.00/SF for industrial office space.
Area (Sq Mi) 3,855,100 Land prices remain steady in the range of $225,000/acre
with ample supply. The investment market remains very
GDP Growth 3.1% strong with good quality investment properties in short supply.
The performance of the Saskatchewan market in light of the
recession has resulted in a steady demand for this type of

GDP 2010 (US$ B) $1,563.66
product. Cap rates that are sub 8% are not uncommon for
quality properties that are well located and well tenanted.
GDP/Capita (USD) $45,887.74
Rural market interest in agricultural land in Saskatchewan
has risen steadily for the past three years. Increasing
Inflation Rate 1.8% commodity prices have led to increased demand for rural

land. Look for values to increase as investors outside
Unemployment 8.0% Saskatchewan view the potential of this province. Worldwide
Rate
demand for agricultural products will foster continued growth

in 2011.
Interest Rate 1.0%
Regina At A Glance
Conversion 1.01 CAD = 1 US$ NET RENT/SF/YR
Low High
US$ NET RENT/SF/YR
Low High Vacancy

DOWNTOWN OFFICE
New Construction (AAA) CAD 37.00 CAD 40.00 $ 36.63 $ 39.60 N/A
Class A (Prime) CAD 19.00 CAD 22.00 $ 18.81 $ 21.78 1.00%
Class B (Secondary) CAD 14.00 CAD 16.00 $ 13.86 $ 15.84 2.42%
SUBURBAN OFFICE
New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) N/A N/A N/A N/A N/A
INDUSTRIAL
Bulk Warehouse CAD 7.00 CAD 9.00 $ 6.93 $ 8.91 N/A
Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D N/A N/A N/A N/A N/A
RETAIL
Downtown CAD 22.00 CAD 27.00 $ 21.78 $ 26.73 N/A
Neighborhood Service Centers CAD 14.00 CAD 17.00 $ 13.86 $ 16.83 N/A
Regional Malls CAD 37.00 CAD 52.00 $ 36.63 $ 51.49 N/A
Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre
Office in CBD CAD 70.00 CAD 85.00 $ 69.31 $ 84.16
Land in Industrial Parks CAD 5.00 CAD 7.00 $ 4.95 $ 6.93
Retail/Commercial Land CAD 15.00 CAD 35.00 $ 14.85 $ 34.65
Residential N/A N/A N/A N/A

EMEA
SECTION CONTENTS
Vienna, Austria
The Baltics (Latvia/Estonia/Lithuania)
Brussels, Belgium
Sofia, Bulgaria
Prague, Czech Republic
Copenhagen, Denmark
Helsinki, Finland
Paris - Ile de France (Paris Region), France
Frankfurt am Main, Germany
Athens, Greece
Reykjavik, Iceland
Tel Aviv, Israel
Almaty, Kazakhstan
Kuwait
Luxembourg City, Luxembourg
Amsterdam, The Netherlands
Oslo, Norway
Warsaw, Poland
Doha City, Qatar
Bucharest, Romania
Moscow, Russia
St. Petersburg, Russia
Belgrade, Serbia
Johannesburg, South Africa
Madrid, Spain
Stockholm, Sweden
Geneva, Switzerland
Zurich, Switzerland
Istanbul, Turkey
Kiev, Ukraine
London, England, United Kingdom
47 47
Vienna, Austria The Baltics (Latvia/Estonia/Lithuania)
Vienna is the capital of Austria and has a population of 1.7 Until recently, the Baltic States have been among the fastest
million. The city historically has been a center for commerce growing economies in Europe. However, the unbalanced
between the East and the West. Growth in the Austrian growth from 2005 to 2008, coupled with global economic
economy is estimated at 1.2% for 2010 with inflation at 1.8%. uncertainties, has resulted in the depth of the current crisis in
The unemployment rate was 4.9% in 2010, lower than the the Baltic countries. There was a total price decrease in 2010
9.6% average in the EMEA. for Estonia at -55%, Lithuania -41% and Latvia -70%. The
bottom seems to have been realized in these markets with the
An estimated 170,000 SM of new supply came on the office
lowest average prices recognized in August 2009 for Estonia,
market in 2010. A delayed reaction to the global economic
September 2009 for Latvia and March 2010 for Lithuania.
crisis continues, resulting in a continued decline in market
supply and demand. However, property searches by several The office market faced a severe seasonal slowdown with
large tenants who have already decided on their location, or vacancy rates continuing to decrease in September 2010.
Contact
are expected do so in the near future, are considered a Landlords offered discounted rentals to offset the imbalance
NAI Baltics
positive indicator in the rental market. While average rents in the short term. It is usual practice with the current financial
+371 6731 2396 circumstances to review lease terms on a yearly basis.
remained stable at approximately EUR 12.10/SM per month,
top rents have increased slightly in recent months and are Compared to 2009 the average rental rate decreased
Country Data - Estonia approximately 15% for Class B and 10% for Class A offices.
currently at EUR 24.50/SM per month. The vacancy rate Area (Sq Mi) 1,7462
Contact increased slightly and is expected to be about 6.0% by the Over the last few years there has been clear segmentation in
GDP Growth 1.8 %
NAI Austria end of 2010. Due to the limited supply on the market, office existing operational retail developments. The new, large-scale
GDP 2010 (US$ B) $19.22
+43 1 512 77 77 prime yields are currently at approximately 5.5%. Neverthe- retail developments have been temporarily postponed. Several
GDP/Capita (US$) $14,416.52 well-performing retailers moved to better locations or extended
less, top yields continue to remain below the peak values
from before the economic crisis and can also be attributed Inflation Rate 2.54% space. Some international companies have chosen to enter
to the limited group of investors. Unemployment Rate 17.55% the Latvian retail market under the new preferential conditions
Interest Rate although that was balanced with several who chose to leave
Trading and forwarding companies were the main turnover 7.5%
the market. There is an ongoing trend to consolidate car
generators for industrial and warehousing facilities in recent Population (Millions) 1.333
dealerships throughout the Baltic States.
months. Average rents are at about EUR 5.0 to 6.0/SM per
month. Owner-occupier is still a dominant feature in the Latvia New international companies entering the market are seeing
market. Area (Sq Mi) 175,015 the benefits of setting up manufacturing or logistics activities
Country Data GDP Growth 15.5%
in the Baltic States due to their strategic geographical location.
Top sector demand from domestic and German investors Rental rates for industrial/warehouse facilities have shown
Area (Sq Mi)
cannot be met in 2010. The 2010 investment volume to GDP 2010 (US$ B) $83.70
instability and witnessed a major decrease, although stabi-
32,383
date has primarily come from the office real estate market. GDP/Capita (US$) $11,900 lization is expected with Deslee Clama NV, Rahmqvist
Retail and logistics properties continue to play a subordinate Inflation Rate 2.5% AB and others entering the market. Bombardier may be
GDP Growth) 1.6%
role in the investment market. The purchase of the IZD Tower Unemployment Rate entering the market through a joint venture bid with local
14.7%
in Vienna’s 22nd district by SIGNA RECAP, together with train producer RVR to supply new trains for Pasazieru
GDP 2010 (US$ B) $366.26 Interest Rate 7.5%
German insurance company R&V Versicherung, was one of viliciens. Swiss train maker Stadler is also bidding on the deal.
the most significant transactions in the market. Credit Suisse Population (Millions) 7.0
GDP/Capita (US$) $43,723.38 expanded its investment activities in the Austrian market Some residential/multifamily projects are in the pipeline and
with the purchase of the first construction stage of Forum Lithuania scheduled to appear on the market in 2011. However, some
Inflation Rate 1.5% Schönbrunn in Vienna’s 12th district. Bank Austria Real Area (Sq Mi) 25,200 still lack financing for development.
Invest purchased the first component of the BOKU BioTech GDP Growth 1.3% In Q2 and Q3 2010, investment volumes were still diminished,
Unemployment 4.1% Center in the 19th district. GDP 2010 (US$ B) $35.73 mostly due to limitations on real estate financing imposed by
Rate
GDP/Capita (US$) $10,765.34 the Scandinavian banks, which play a leading role in the
Top office space completions in 2010 include: Rivergate
Interest Rate 1.0% Baltics. Only cash buyers are still active in the market. We also
at 1200 Vienna, Handelskai 92 with 40,000 SM; Company Inflation Rate 1.0%
expect to see a gap in buyers’ and sellers’ yield expectations
buildings 03 and 04 at TownTown, 1030 Vienna, Thomas- Unemployment Rate 18.0%
Population (Millions) 8.377 of up to 2-4%.
Klestil-Platz with 29,000 SM; and LX2 at 1100 Vienna, Interest Rate 7.5%
Laxenburger Strasse with 15,500 SM. Population (Millions) 3.319
Vienna At A Glance The Baltics At A Glance

Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) EUR 13.00 EUR 24.50 $ 20.13 $ 37.94 6.00% New Construction (AAA) EUR 8.00 EUR 12.00 $ 12.39 $ 18.58 20.00%
Class A (Prime) EUR 13.00 EUR 24.50 $ 20.13 $ 37.94 6.00% Class A (Prime) EUR 10.00 EUR 14.00 $ 15.48 $ 21.68 20.00%
Class B (Secondary) EUR 10.90 EUR 13.00 $ 16.88 $ 20.13 6.00% Class B (Secondary) EUR 6.00 EUR 8.00 $ 9.29 $ 12.39 30.00%
Class B (Secondary) EUR 7.50 EUR 1 1.70 $ 11.61 $ 18.12 6.00% Class B (Secondary) EUR 3.00 EUR 4.00 $ 4.65 $ 6.19 40.00%
Bulk Warehouse EUR 2.50 EUR 5.00 $ 3.87 $ 7.74 9.00% Bulk Warehouse EUR 2.00 EUR 5.00 $ 3.10 $ 7.74 40.00%
Manufacturing EUR 4.20 EUR 5.80 $ 6.50 $ 8.98 9.00% Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D EUR 5.00 EUR 6.50 $ 7.74 $ 10.06 8.00% High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center EUR 72.70 EUR 240.00 $ 112.57 $ 371.61 7.50% City Center EUR 8.00 EUR 18.00 $ 12.39 $ 27.87 5.00%
Neighborhood Service Centers EUR 21.70 EUR 35.80 $ 33.60 $ 55.43 7.50% Retail Units in Parks EUR 7.00 EUR 13.00 $ 10.84 $ 20.13 20.00%
Community Power Center (Big Box) EUR 5.80 EUR 7.25 $ 8.98 $ 11.23 7.50% Community Power Center (Big Box) EUR 5.00 EUR 8.00 $ 7.74 $ 12.39 20.00%
Regional Malls N/A N/A N/A N/A N/A Regional Shopping Centers/Malls N/A N/A N/A N/A N/A
Solus Food Stores EUR 5.20 EUR 5.80 $ 8.05 $ 8.98 9.00% Solus Food Stores N/A N/A N/A N/A N/A
Office in CBD EUR 4,360.00 EUR 13,081.00 $ 24,506,001.72 $73,523,625.81 Office in CBD EUR 200.00 EUR 600.00 $ 1,124,128.52 $ 3,372,385.56
Land in Office Parks EUR 2,100.00 EUR 3,200.00 $ 11,803,349.45 $17,986,056.31 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks EUR 2,000.00 EUR 3,052.00 $ 11,241,285.19 $17,154,201.21 Land in Industrial Parks EUR 20.00 EUR 40.00 $ 112,412.85 $ 224,825.70
Office/Industrial Land - Non-park EUR 2,180.00 EUR 3,488.00 $ 12,253,000.86 $19,604,801.38 Office/Industrial Land - Non-park EUR 10.00 EUR 50.00 $ 56,206.43 $ 281,032.13
Retail/Commercial Land EUR 2,000.00 EUR 3,052.00 $ 11,241,285.19 $17,154,201.21 Retail/Commercial Land EUR 20.00 EUR 100.00 $ 112,412.85 $ 562,064.26
Residential EUR 2,620.00 EUR 8,000.00 $ 14,726,083.60 $44,965,140.77 Residential EUR 10.00 EUR 80.00 $ 56,206.43 $ 449,651.41

Brussels, Belgium Sofia, Bulgaria
Brussels, the capital of Belgium and Europe, is located in The downturn was first felt in October 2008. Deteriorating
the center of Belgium and has over 1 million inhabitants. In domestic demand has led to a contraction of Bulgaria’s
addition to the European Union, Brussels hosts NATO, the economy by 5.8-7.1% in Q2 2010. The country's economy
BENELUX Secretariat-General, the Customs Cooperation deteriorated significantly throughout 2010. Investment volume
Council and Eurocontrol. The Brussels-Capital Region is not is off 60% compared to 2008. Most commercial development
only a key international political player, but also the country's plans have either been stopped or are on hold.
leading economic hub. Despite being essentially tertiary, The market was characterized by weakened domestic
Brussels is, nevertheless, the second largest industrial demand in comparison to the previous year. Rising exports
center in Belgium after Antwerp. will help offset that weakened demand, but expectations are
Office vacancy rose further in 2010, pushed up by completion for continued negative GDP. Mostly because the adjustment
of new speculative developments. Vacancy in the Brussels process is still going on and because the currency is fixed,
office market is currently estimated at 11.84% or 1.5 million most of this adjustment takes place at a slower pace. Recent
SM. Development completions will continue throughout the data indicates that inflation is heading to a negative territory
second half of 2010. From 2011 onwards, office develop- which, in turn, is also hurting the GDP growth. Bulgaria
ment is expected to slow down as fewer projects are being reported a monthly deflation of non-EU harmonized
launched. Because of favorable real estate opportunities, consumer prices for July, for a third month in a row. We are
Contact more tenants are now actively looking into the possibility of Contact seeing a further deterioration in domestic demand, which is
NAI Belux relocating. NAI atrium the key factor for the deepening erosion of GDP. At the same
+32 2 420 10 10 +359 2 817 3458 time, net exports should be contributing positively but that
The construction of industrial properties came to halt during
the economic downturn. Take-up in 2010 was relatively will not be enough to offset the slump of the domestic
high, which makes it a very good year compared to recent demand component.
history. Market activity was driven by some larger logistics trans- Plans to start development of nine industrial parks are on
actions, whilst small and medium-sized end-user purchase hold. Most of the transactions are done by local players. The
transactions were also significant. Still, demand remains only property transactions that are continuing are the
fragile, so future quarters will have to tell us whether this is seasonal and holiday properties along the Black Sea coast,
the sign of a temporary rebound or of sustained recovery. but even those are moving along at a much slower pace.
The Belgium retail sector has so far kept up relatively well. Banks have gradually started to open up for credit but at
Country Data Country Data much higher interest rates than a year ago.
Over most of 2010 demand from retailers across most
subsectors was healthy. Any increase in rents in the short The office market has remained the most developed
Area (Sq Mi) 11,787 Area (Sq Mi) 42,811
term is not likely. So far the economic slowdown has had commercial property sector in Bulgaria, primarily concen-
very little effect on prime rents across the major cities. Retail trated in Sofia. Vacancy rates are in the range of 13.5% with
warehousing and shopping center rents have also remained vacancy rates of 19.6% in the suburban areas. Four new
largely unchanged. Shopping development in Belgium was shopping malls opened and reached 220,000 SM. The first
GDP 2010 (US$ B) $461.33 relatively high in 2009. GDP 2010 (US$ B) $44.84 Carrefour hypermarket opened n Burgas.
With the effects of a strong rebound in exports fading, the
Belgian economy will become more reliant on domestic
sources of growth. To this end, it is clearly positive that
consumer spending appears to be showing signs of
strength, aided by a potential labor market recovery. How-
Unemployment 8.7% Unemployment 12.0%
Rate ever, fiscal consolidation measures, such as welfare cuts Rate
and tax increases, could also dampen demand and temper
Interest Rate 1.0% recovery. GDP is forecasted to increase by 1.3% in 2010 Interest Rate 1.0%

and 1.8% in 2011. Inflation is expected to increase, partly Population (Millions) 7.531
as a result of higher oil prices and the weak Euro. Latest
forecasts predict prices will increase by 1.8% in 2010.
Brussels At A Glance Sofia At A Glance

Conversion 0.72 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
Bulk Warehouse EUR 40.00 EUR 46.00 $ 5.16 $ 5.94 N/A Bulk Warehouse EUR 3.00 EUR 6.00 $ 4.65 $ 9.29 5.00%
Manufacturing EUR 44.00 EUR 52.00 $ 5.68 $ 6.71 N/A Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D EUR 50.00 EUR 60.00 $ 6.45 $ 7.74 N/A High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center EUR 1,250.00 EUR 1,650.00 $ 161.29 $ 212.90 N/A City Center (High Street Shop) EUR 30.00 EUR 90.00 $ 46.45 $ 139.35 N/A
Neighborhood Service Centers EUR 120.00 EUR 170.00 $ 15.48 $ 21.94 N/A Neighborhood Service Centers EUR 10.00 EUR 30.00 $ 15.48 $ 46.45 N/A
Community Power Center (Big Box) N/A N/A N/A N/A N/A Community Power Center(Big Box) N/A N/A N/A N/A N/A
Regional Shopping Centers/Malls EUR 1,250.00 EUR 1,650.00 $ 161.29 $ 212.90 N/A Regional Shopping Centers/Mall EUR 15.00 EUR 50.00 $ 23.23 $ 77.42 N/A
Office in CBD EUR 1,500.00 EUR 2,500.00 $ 8,430,963.90 $ 14,051,606.49 Office in CBD EUR 500.00 EUR 1,000.00 $ 2,810,321.30 $ 5,620,642.60
Land in Office Parks EUR 500.00 EUR 1,000.00 $ 2,810,321.30 $ 5,620,642.60 Land in Office Parks EUR 250.00 EUR 550.00 $ 1,405,160.65 $ 3,091,353.43
Land in Industrial Parks EUR 100.00 EUR 150.00 $ 562,064.26 $ 843,096.39 Land in Industrial Parks N/A N/A N/A N/A
Office/Industrial Land - Non-park EUR 200.00 EUR 350.00 $ 1,124,128.52 $ 1,967,224.91 Office/Industrial Land - Non-park EUR 40.00 EUR 80.00 $ 224,825.70 $ 449,651.41
Retail/Commercial Land EUR 250.00 EUR 750.00 $ 1,405,160.65 $ 4,215,481.95 Retail/Commercial Land EUR 200.00 EUR 1,000.00 $ 1,124,128.52 $ 5,620,642.60
Residential EUR 500.00 EUR 1,000.00 $ 2,810,321.30 $ 5,620,642.60 Residential EUR 50.00 EUR 500.00 $ 281,032.13 $ 2,810,321.30

Prague, Czech Republic Copenhagen, Denmark
Generally the Czech Republic is seen as a relatively stable The Danish real estate market began a slow recovery
economy and has weathered the 2008-2010 financial storm throughout 2010. The GDP is forecasted to end at 1.7% in
better than most CEE/SEE countries, with perhaps the excep- 2010 and 1.5% in 2011. Private consumption is increasing
tion of Poland. Unemployment is around 8.3% and growth is but at a slow rate, mainly being driven by the low interest
forecast to be around 1.1%, up from year-over-year negative rates and a steady/improving unemployment rate continuing
growth in the previous two years. Industrial exports, especially into 2011. Exportation within the energy, pharmaceutical,
to Germany, are the main drivers of the economy. medical and machinery businesses has been one of the
Modern office stock in Prague amounts to 2.5 million SM, main drivers for the economy. Financing is still restrictive,
of which 70% are Class A properties. The pipeline for 2010 especially with junior loan arrangements.
is estimated at 55,000 SM (65,000 SM for 2011). The Vacancy rates in the office market increased during 2009
vacancy rate is currently 11.8%. Net take-up of space is and 2010, but seem to have stabilized between 9% and
down year over year. Future pipeline is restricted due to the 10% with a slight decrease predicted for 2011. Rent levels
pre-leasing requirements of lending banks whose terms decreased during the first half of 2010 but have stabilized
remain particularly difficult to accept. in the second half. In 2010 approximately 150,000 SM of
Total retail stock in Prague currently stands at 885,000 SM. new Class A office buildings have been developed, but much
New construction is limited with only Galerie Harfa in Prague less is anticipated for 2011.
Contact Contact
being the only significant new openning this year. Future pipeline A low supply of industrial properties consisting of 2,500 SM
NAI MIPA NAI Denmark
is also limited with growth focused on the expansion or or more in the city of Copenhagen has resulted in a stabi-
+420 224 818 677 +45 70 23 00 26
refurbishment of existing centers. Some of the smaller prop- lization of rent levels for the past several years and that trend
erties are showing signs of distress and one former Carrefour is expected to continue through 2011. The vacancy rate has
center has already closed and been converted to a mega XXX increased slightly to around 5.5%. The areas closest to
Lutz furniture. Copenhagen have become the primary location for large
Current industrial stock stands at around 2 million SM. Rents warehouse and logistics centers.
have decreased significantly as severe competition takes its As private consumption has increased, so has the demand
hold and existing vacant stock is taken up. Speculative for retail space, although is still recovering from a low point
development has ceased in favor of build-to-suit. in 2009. It is now possible for retailers to find prime
Country Data There was limited activity in the investment market in 2009 Country Data locations, which historically has been very difficult. Rent
and 2010 with only a handful of transactions completed. levels have been stable during 2010 and are predicted
Area (Sq Mi) 30,450 German funds such as Deka were the active players in Area (Sq Mi) 16,639
to remain stable in 2011. The vacancy rate has stabilized
2008-2009 but recently international investors have shifted to around 3%. There are no large developments scheduled
their attention to well established, traditional markets. This to come on to the market.
gap in the local capital markets has gradually been filled by The investment market is slowly becoming more active after
GDP 2010 (US$ B) $195.23 domestic investors. GDP 2010 (US$ B) $304.56 a stall in the first part of 2010. There is increased demand
The recent increase in market activity has resulted in yields for prime office and residential properties where the net yield
GDP/Capita (US$) $18,721.63 falling with the prime office and retail yields currently standing GDP/Capita (US$) $55,112.71
has settled at 5% to 5.5%. Several investment fundamentals
at 6.75%. Recent office investment deals saw the acquisition have fallen into place although high leverage financing
of City Empiria and 90% of City Forum by the PPF were is still very difficult. The market for prime properties
concluded at around 7.5% and the purchase of Cetelem by should increase in 2011, slowed by the lack of supply in that
Unemployment the HypoRealInvest, which concluded at 8.5%. Industrial Unemployment asset class. There are several capital strong investors in the
8.3% 4.2%
Rate yields stand at around 8%. Rate market looking for prime investment properties or to acquire
distressed properties at a bargain rate. Distressed property
Interest Rate 0.8% It is important that institutional investors return in the Czech Interest Rate 0.8%
opportunities have been limited due to financiers who have
investment market in order to facilitate sustainable growth. been protecting their securities. The market for secondary
Office rents are forecast to rise as office demand increases class properties is still inactive, primarily due to the price
in 2011-2012 and vacancy rates fall with the resultant expectation gap between buyers and sellers.
upward pressure on rents.
Prague At A Glance Copenhagen At A Glance
Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 5.28 DKK = 1 US$ RENT/M2/YR US$ RENT/SF/YR
CITY CENTER OFFICE CENTER CITY OFFICE
New Construction (AAA) EUR 21.00 EUR 22.00 $ 32.52 $ 34.06 N/A New Construction (AAA) DKK 1,300.00 DKK 1,750.00 $ 22.87 $ 30.79 8.00%
Class A (Prime) EUR 15.00 EUR 18.00 $ 23.23 $ 27.87 N/A Class A (Prime) DKK 1,100.00 DKK 1,400.00 $ 19.35 $ 24.63 10.00%
Class B (Secondary) EUR 12.00 EUR 13.00 $ 18.58 $ 20.13 N/A Class B (Secondary) DKK 650.00 DKK 1,000.00 $ 11.44 $ 17.60 12.00%
New Construction (AAA) EUR 14.50 EUR 15.50 $ 22.45 $ 24.00 N/A New Construction (AAA) DKK 900.00 DKK 1,300.00 $ 15.84 $ 22.87 9.00%
Class A (Prime) EUR 14.00 EUR 15.00 $ 21.68 $ 23.23 N/A Class A (Prime) DKK 800.00 DKK 1,000.00 $ 14.08 $ 17.60 9.00%
Class B (Secondary) EUR 10.00 EUR 12.00 $ 15.48 $ 18.58 N/A Class B (Secondary) DKK 500.00 DKK 750.00 $ 8.80 $ 13.20 9.00%
Bulk Warehouse EUR 3.00 EUR 3.75 $ 4.65 $ 5.81 N/A Bulk Warehouse DKK 350.00 DKK 550.00 $ 6.16 $ 9.68 5.50%
Manufacturing EUR 3.00 EUR 3.50 $ 4.65 $ 5.42 N/A Manufacturing DKK 350.00 DKK 550.00 $ 6.16 $ 9.68 5.50%
High Tech/R&D EUR 3.75 EUR 4.50 $ 5.81 $ 6.97 N/A High Tech/R&D DKK 350.00 DKK 550.00 $ 6.16 $ 9.68 5.50%
RETAIL RETAIL
City Center EUR 140.00 EUR 160.00 $ 216.77 $ 247.74 N/A Downtown DKK 3,500.00 DKK 15,000.00 $ 61.58 $ 263.93 5.20%
Neighborhood Service Centers EUR 40.00 EUR 45.00 $ 61.93 $ 69.68 N/A Neighborhood Service Centers DKK 6,500.00 DKK 2,500.00 $ 114.37 $ 43.99 3.30%
Community Power Center (Big Box) EUR 8.00 EUR 10.00 $ 12.39 $ 15.48 N/A Community Power Center DKK 1,000.00 DKK 2,200.00 $ 17.60 $ 38.71 3.30%
Regional Shopping Centers/Malls EUR 43.00 EUR 55.00 $ 66.58 $ 85.16 N/A Regional Malls DKK 1,000.00 DKK 2,200.00 $ 17.60 $ 38.71 3.30%
Solus Food Stores EUR 8.00 EUR 10.50 $ 12.39 $ 16.26 N/A Solus Food Stores DKK 900.00 DKK 1,500.00 $ 15.84 $ 26.39 3.30%
Office in CBD EUR 320.00 EUR 500.00 $ 1,798,605.63 $ 2,810,321.30 Office in CBD DKK 1,800.00 DKK 3,500.00 $ 1,379,612.27 $ 2,682,579.42
Land in Office Parks EUR 120.00 EUR 150.00 $ 674,477.11 $ 843,096.39 Land in Office Parks DKK 1,500.00 DKK 3,500.00 $ 1,149,676.89 $ 2,682,579.42
Land in Industrial Parks EUR 35.00 EUR 50.00 $ 196,722.49 $ 281,032.13 Land in Industrial Parks DKK 1,200.00 DKK 3,000.00 $ 919,741.52 $ 2,299,353.79
Office/Industrial Land - Non-park EUR 20.00 EUR 25.00 $ 112,412.85 $ 140,516.06 Office/Industrial Land - Non-park DKK 1,500.00 DKK 2,750.00 $ 1,149,676.89 $ 2,107,740.97
Retail/Commercial Land EUR 50.00 EUR 75.00 $ 281,032.13 $ 421,548.19 Retail/Commercial Land DKK 1,800.00 DKK 4,000.00 $ 1,379,612.27 $ 3,065,805.05
Residential EUR 50.00 EUR 100.00 $ 281,032.13 $ 562,064.26 Residential DKK 1,000.00 DKK 3,000.00 $ 766,451.26 $ 2,299,353.79

Helsinki, Finland Paris - lle de France (Paris Region), France
Finland is recovering from the recession better than was The economic crisis made its mark on the entire French real
expected at the beginning of 2010. GDP growth is expected estate market with a particularly strong impact on sales
to be 2.6% in 2010 and 3% in 2011. Finland has main- volumes (a fall of 35% on rentals and 38% for investment) and
tained its competitive standing better than most of the on rental values with a 20% fall in 2008/2009. 2010 saw a
European countries and Newsweek announced in August slight improvement in the general economy with historically low
2010 that Finland is "the best country" in the world, due to rates. The solid strength of French banks throughout the crisis
Finland's competitiveness and educational system. gave confidence to the players in the French financial system
Rental rates have stabilized during 2010 in all sectors with the The market took noticeable advantage of this improvement.
exception of old and outdated office space. Today's clients The office market had 1.6 million SM in transactions during
require new and efficient properties instead of traditional ones. Q1-Q2-Q3 2010 with a 25% increase in volume compared
The vacancy rate for older office properties is expected to to 2009. In 2010 2,200,000 SM are expected to be rented,
increase into the future when new construction and "green which is consistent with numbers from 2008. The upturn,
buildings" are likely to be the key words. Traditional, poor which started in properties under 500 SM in the CBD,
condition and not technologically updated properties will find seems to have spread to other markets. Medium and large
their "new life" only after total modernization. With the need size deals have returned to their usual market shares with
for residential properties on the rise, higher prices will be 37% for properties above 5,000 SM and 30% for medium
Contact reflected in the market. We are likely to see many old office Contact size properties on the market. More difficult sectors have
NAI Premises areas turned into residential ones in the coming years. NAI France returned to an acceptable volume in activity. Due to the high
+358 20 7290 710 +33 1 74 90 50 32 vacancy rate of 7%, the increase in the volume of transac-
The retail sector in Finland has suffered the least over the
past several years. Vacancy rates are relatively low and tions has not yet been followed by an increase in rental
rental prices have been stable. New retail parks and other rates.
retail establishments are slated for construction in the near Both the reduction of rental rates and optimism regarding
future and new retail chains will probably enter the Finland the French financial market have had positive effects on the
market in 2011. investment market since January 2010. The volume trans-
The industrial sector will face some difficulties over the next acted increased by 60%. At the end of Q3 2010, €4.5 billion
several years. With domestic production decreasing and an was invested in IDF and €7 billion is expected to be trans-
increase in production capacity being moved to China and acted by the end of 2010. Office and retail properties rep-
Country Data Country Data resent 85% of the commitments. Nevertheless public debt
India, the vacancy rate of manufacturing space is set to
increase dramatically over several years. Those properties & non-performing private debt remain and the first forced
Area (Sq Mi) 130,666 Area (Sq Mi) 24,4310 sales appeared.
are mainly in out of town areas and therefore not easy to
renovate for other uses. New logistic/warehouse areas will Investors remain extremely cautious but willing to commit, and
be constructed in the near future. Due to a decrease in the focus on office core and retail with yields for prime offers
domestic manufacturing industry and longer delivery times under 5%. Foreign investors, particularly the Germans, are
GDP 2010 (US$ B) $231.98 GDP 2010 (US$ B) $2,555.44
from Asian countries, the need for bigger stocks is a reality. confident on the strength and stability of the French market,
Transaction volume remained low in 2010 but it is expected representing 50% of the investment realized in 2010.
GDP/Capita (US$) $4,314.00 to increase in 2011. GDP/Capita (US$) $40,591.44
No significant change in economic policy is expected for 2011
Residential leasing opportunities will be of interest to foreign with growth forecast to be similar to 2010 at 1.2%-1.8%. The
investors in the coming years due to the stability of cash rental market should see both a reduction in vacancy and a
Unemployment
flow and a low investment yield. Unemployment reasonable increase in property values. The optimistic scenario
8.8% 9.8%
Rate The year was not without a number of notable investment Rate for the investment market is a regular flow of good, new assets
sales transactions: In Q1, Keva bought an office building in put on the market by investors in search of liquidity and who
Helsinki, Kamppi from Etera and Paperiliitto for €18 million. are confident with the financial outcome. This requires no
Population (Millions) 5.378 In Q2, YIT sold a Shopping Center in Hyvinkää for €80 million Population (Millions) 62.955 surprises in the financial markets and a sustained confidence
to Varma. In Q3 Skanska sold an office building located in in the strength of the French economy. The preference for
Helsinki to Commerzial Real for €38 million. secured assets is expected to continue.
Helsinki At A Glance Paris At A Glance

Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) EUR 22.00 EUR 27.00 $ 34.06 $ 41.81 N/A New Construction (AAA) EUR 450.00 EUR 750.00 $ 58.06 $ 96.77 N/A
Class A (Prime) EUR 22.00 EUR 28.00 $ 34.06 $ 43.35 5.50% Class A (Prime) EUR 380.00 EUR 620.00 $ 49.03 $ 80.00 N/A
Class B (Secondary) EUR 17.00 EUR 21.00 $ 26.32 $ 32.52 7.60% Class B (Secondary) EUR 240.00 EUR 450.00 $ 30.97 $ 58.06 N/A
New Construction (AAA) EUR 17.00 EUR 19.00 $ 26.32 $ 29.42 9.50% New Construction (AAA) EUR 180.00 EUR 450.00 $ 23.23 $ 58.06 N/A
Class A (Prime) EUR 15.00 EUR 18.00 $ 23.23 $ 27.87 12.00% Class A (Prime) EUR 150.00 EUR 350.00 $ 19.35 $ 45.16 N/A
Class B (Secondary) EUR 8.00 EUR 13.00 $ 12.39 $ 20.13 14.50% Class B (Secondary) EUR 100.00 EUR 200.00 $ 12.90 $ 25.81 N/A
Bulk Warehouse EUR 6.00 EUR 7.70 $ 9.29 $ 11.92 5.20% Bulk Warehouse EUR 45.00 EUR 50.00 $ 5.81 $ 6.45 N/A
Manufacturing EUR 5.00 EUR 7.00 $ 7.74 $ 10.84 5.30% Manufacturing EUR 55.00 EUR 75.00 $ 7.10 $ 9.68 N/A
High Tech/R&D EUR 6.00 EUR 8.00 $ 9.29 $ 12.39 5.30% High Tech/R&D EUR 50.00 EUR 110.00 $ 6.45 $ 14.19 N/A
RETAIL RETAIL
Downtown EUR 25.00 EUR 140.00 $ 38.71 $ 216.77 2.70% City Center EUR 7,500.00 EUR 12,000.00 $ 967.73 $1,548.37 N/A
Neighborhood Service Centers EUR 11.00 EUR 44.00 $ 17.03 $ 68.13 3.00% Retail Units in Parks N/A N/A N/A N/A N/A
Community Power Center EUR 11.00 EUR 40.00 $ 17.03 $ 61.93 3.10% Community Power Center (Big Box) N/A N/A N/A N/A N/A
Regional Malls EUR 11.00 EUR 40.00 $ 17.03 $ 61.93 2.90% Regional Shopping Centers/Malls N/A N/A N/A N/A N/A
Solus Food Stores EUR 9.00 EUR 16.00 $ 13.94 $ 24.77 3.10% Solus Food Stores N/A N/A N/A N/A N/A
Land in Office Parks EUR 275.00 EUR 500.00 $ 1,545,676.71 $ 2,810,321.30 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks EUR 175.00 EUR 300.00 $ 983,612.45 $ 1,686,192.78 Land in Industrial Parks N/A N/A N/A N/A
Office/Industrial Land - Non-park EUR 225.00 EUR 275.00 $ 1,264,644.58 $ 1,545,676.71 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land EUR 250.00 EUR 400.00 $ 1,405,160.65 $ 2,248,257.04 Retail/Commercial Land N/A N/A N/A N/A
Residential EUR 250.00 EUR 600.00 $ 1,405,160.65 $ 3,372,385.56 Residential N/A N/A N/A N/A

Frankfurt am Main, Germany Athens, Greece
The German economy is recovering. In spring 2010 the growth Heading into 2011, Greece will see a number of new govern-
of the gross domestic product was at 2.2%. This growth rate ment measures with hopes to stimulate the market to alleviate
was surprisingly high and broke the average economic debt-burdened merchants from bankruptcies. One measure
increase by far. Primarily responsible for the growth were includes government intervention with formulated rent
Germany’s export and construction investments. Consumption contracts asphyxiating rent-related measures. Although
and equipment investment gave strong impulses for measures have provided a breath of fresh air to problematic
increased economic activity as well. The unemployment rate businesses they have also eroded the commercial market as
has started to fall slowly but constantly at a rate of around an investment vehicle. In the past year the market suffered a
7.6%. Only the inflation rate, which was close to zero in fall 30% decline in value and negative price spiral, which is
2009, increased and is currently at 1%. The future outlook expected to continue into 2011.
is optimistic. Experts expect a stable economic growth of The macroeconomic perspective indicates overall that the
about 2% for 2011. Greek economy shrunk about 2% in 2009 and is expected
The real estate market clearly shows signs of recovery in to shrink a further 2% in 2010. The government austerity
the course of the overall economic revival. Because of the measures that include those imposed by the International
ascending recruitment and investments of the companies, Monetary Fund and the EU require that debt is reduced by at
the markets for office space and industrial sites are likely least 3% of current GDP by 2012.
Contact to react positively as well over the next 8-12 months. Contact
Due to the current economic situation there is a limited
NAI apollo NAI Ktimatiki
The German investment market slightly decreased. Transaction volume of transactions and construction. There is a relocation
+49 69 970 50 50 +30 210 3628559
volume through Q3 2010 was running about €415 million lower and downsizing into smaller office spaces and/or locating in
than in the previous year, a decrease of approximately 10%. secondary areas. Demand fell 11% and lease renegotiations
Total transaction volume was approximately €3.565 billion. increased with rate reductions ranging from 15% up to 30%.
Except for Berlin, where the volume of the investment market Vacancy rates increased over the last quarter and now exceed
doubled from about €770 million to €1,475 million, this trend 10%. Athens and suburban CBD areas are still the main focus
reflects the activity in the major German office markets. of attention for potential occupiers with good transport links,
The currently low interest rates will soon cause an increase especially the metro, remains an important factor for new
in prices for property, especially in the core-property sector. offices. With relatively subdued demand in the leasing market,
Property in the Class B and Class C sector is currently not speculative developments are scarce with developers choosing
Country Data Country Data to have the safety of pre-lease agreements or a built-to-suit
highly sought after, but demand for these kinds of property
will rise again in the long run. requirement before commencing construction.
Through the end of Q3 2010, approximately 1.34 million Similar trends are observed in the retail market, with supply
SM were rented in the top seven German office markets. on High Streets having increased, resulting in decreased
GDP Growth 3.3% GDP Growth -4.0%
Vacancy increasing slightly, from 8.9% in 2009 to almost rents. Athens prime High Street rents fell 15% year-over-year
10% in Q3 2010. Stuttgart has the lowest vacancy rate with from the second half of 2009 to the second half of 2010.
GDP 2010 (US$ B) 3,305.90 GDP 2010 (US$ B) $305.01
6.6%, while Dusseldorf and Frankfurt show vacancies of Overall rental rates declined by 15-30%.
GDP/Capita (US$) 40,511.83
more than 15%. GDP/Capita (US$) $27,264.83
Industrial rents are likely to see a limited recovery, with
NAI apollo expects to see an end to the increasing vacancy continued corrections in the short- to medium-term. There is
rate by the end of 2010. Lettings will increase again with likely to be an expansion of third-party logistics providers,
higher absorption rates in the near future. This should bring however, demand for commercial property will be driven
Unemployment 6.7% higher rent levels and decreasing vacancy in the middle of Unemployment
by such factors as improving infrastructure throughout the
11.76%
Rate 2011. The average prime rent for Germany’s top seven Rate country, and assisted by the strategic position of Greece-
is at €24.48/SM. Prime rents in Frankfurt of €39.00/SM the juncture of Europe, Asia and Africa.
are well above the average. Cologne and Stuttgart have the
Population (Millions) 81.759 lowest prime rents at slightly below €20.00/SM. Population (Millions) 11.187
Frankfurt am Main At A Glance Athens At A Glance

Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
Class A (Prime) EUR 15.00 EUR 37.50 $ 23.23 $ 58.06 15.60% New Construction (AAA) EUR 14.00 EUR 9.00 $ 21.68 $ 29.42 12.00%
Class B (Secondary) EUR 12.50 EUR 24.70 $ 19.35 $ 38.24 15.60% Class A (Prime) EUR 13.00 EUR 17.00 $ 20.13 $ 26.32 12.00%
Average City Center EUR 15.00 EUR 23.30 $ 23.23 $ 36.08 15.60% Class B (Secondary) EUR 8.00 EUR 10.00 $ 12.39 $ 15.48 16.00%
Westend Class A (Prime) EUR 25.00 EUR 35.00 $ 38.71 $ 54.19 15.60% New Construction (AAA) EUR 14.00 EUR 19.00 $ 21.68 $ 29.42 13.00%
Westend Class B (Secondary) EUR 16.00 EUR 28.00 $ 24.77 $ 43.35 15.60% Class A (Prime) EUR 10.00 EUR 16.00 $ 15.48 $ 24.77 13.00%
Suburban Class A (Prime) EUR 12.00 EUR 18.50 $ 18.58 $ 28.64 15.60% Class B (Secondary) EUR 8.00 EUR 13.00 $ 12.39 $ 20.13 16.00%
Suburban Class B (Secondary) EUR 5.00 EUR 13.50 $ 7.74 $ 20.90 15.60% INDUSTRIAL
INDUSTRIAL Bulk Warehouse EUR 4.00 EUR 5.00 $ 6.19 $ 7.74 6.00%
Bulk Warehouse EUR 3.00 EUR 6.70 $ 4.65 $ 10.37 N/A Manufacturing EUR 5.00 EUR 6.00 $ 7.74 $ 9.29 N/A
Manufacturing EUR 3.80 EUR 5.70 $ 5.88 $ 8.83 N/A High Tech/R&D EUR 5.00 EUR 7.50 $ 7.74 $ 11.61 N/A
High Tech/R&D EUR 4.50 EUR 9.50 $ 6.97 $ 14.71 N/A RETAIL
RETAIL Downtown EUR 32.00 EUR 250.00 $ 49.55 $ 387.09 N/A
Zeil (Prime Shop Units) EUR 220.00 EUR 270.00 $ 340.64 $ 418.06 N/A Neighborhood Service Centers EUR 18.00 EUR 28.00 $ 27.87 $ 43.35 N/A
Goethe Strasse (Prime Shop Units) EUR 160.00 EUR 220.00 $ 247.74 $ 340.64 N/A Community Power Center (Big Box) EUR 11.00 EUR 18.00 $ 17.03 $ 27.87 N/A
Community Power Center (Big Box) EUR 8.00 EUR 16.70 $ 12.39 $ 25.86 N/A Regional Malls EUR 22.00 EUR 70.00 $ 34.06 $ 108.39 N/A
Regional Centers/Malls EUR 10.00 EUR 20.80 $ 15.48 $ 32.21 N/A Solus Food Stores EUR 8.00 EUR 12.00 $ 12.39 $ 18.58 N/A
Solus Food Stores EUR 13.30 EUR 17.50 $ 20.59 $ 27.10 N/A DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
Office in CBD EUR 5,000.00 EUR 12,000.00 $ 28,103,212.98 $ 67,447,711.16
Office in CBD EUR 3,500.00 EUR 15,000.00 $ 19,672,249.09 $ 84,309,638.95 Land in Office Parks N/A N/A N/A N/A
Land in Office Parks EUR 200.00 EUR 450.00 $ 1,124,128.52 $ 2,529,289.17 Land in Industrial Parks EUR 80.00 EUR 180.00 $ 449,651.41 $ 1,011,715.67
Land in Industrial Parks EUR 200.00 EUR 250.00 $ 1,124,128.52 $ 1,405,160.65 Office/Industrial Land - Non-park EUR 120.00 EUR 180.00 $ 674,477.11 $ 1,011,715.67
Office/Industrial Land - Non-park EUR 100.00 EUR 200.00 $ 562,064.26 $ 1,124,128.52 Retail/Commercial Land EUR 1,500.00 EUR 2,500.00 $ 8,430,963.90 $ 14,051,606.49
Retail/Commercial Land EUR 200.00 EUR 300.00 $ 1,124,128.52 $ 1,686,192.78 Residential EUR 900.00 EUR 2,700.00 $ 5,058,578.34 $ 15,175,735.01
Residential EUR 600.00 EUR 1,500.00 $ 3,372,385.56 $ 8,430,963.90

Reykjavik, Iceland Tel Aviv, Israel
The economic situation in Iceland has been uncertain Israel has been among the first countries to recover from
throughout 2010. The recovery process for the economy the economic crisis and local banks are again willing to
supported by the IMF is on track, but currency restrictions extend credit. The solidity of the banking sector and the
are keeping foreign investors away from the market. Rents vitality of the high-tech industry are the main factors behind
have declined by 30-50% from 2008. Sales of commercial the ability of the Israeli economy in general, and the real
properties are negligible and sale prices still seem to be in estate market in particular, to weather the global crisis and
a declining phase. rapidly return to positive growth in 2010.
The property market in Iceland has again been slow or In 2010, the price of residential properties has significantly
almost frozen throughout the year, as it was in 2009. The risen about 10% compared to 2009. In the commercial
rental market is active; however, rental prices have declined market, the office market rents are slowly increasing and
by 10-20% from the previous year depending on location. several new projects will be delivered in the next two quarters.
Office space vacancy has increased gradually for the The demand for office space is stable and the vacancy is
last two years and the leasing market for offices is a true diminishing. It is worth noting that many companies made
occupiers’ market at the moment. Most sales deals that the strategic choice of buying their office instead of renting
occur are for smaller units, where buyers are using the it. The industrial market has been stable and the demand is
opportunity to buy into a better location now at a lower price mostly concentrated on logistic centers and warehousing.
Contact than in the last few years. Contact
The retail market has been characterized by an increase in
NAI Reykjavik NAI Yair Levy Strategy
Many of the Icelandic real estate holding companies have turnover. The low vacancy rate and the high demand for
+ 354 5331122 + 972 3 613 66 99
gone bankrupt or have been financially restructured by the retail space have pushed the prices up by a minimum of
debt owners, so the ownership of a large part of the leased 5%. Three main groups control the retail sector and are in
out real estate base has changed hands. The largest mall great demand for land for the development of new malls. A
in Iceland (Smaralind) was offered in the market this year, notable transaction in the sector was the acquisition by
but the highest bid was rejected. Melisron of 71% of British-Israel for NIS 1.7 billion. Leo Noe,
The fundamentals in the Icelandic economy are the export British-Israel owner, bought the company in 2004 for NIS
of fish and aluminium, which have been enjoying the very 400 million. As a result of the deal, Melisron-British
weak Icelandic krona. Also the tourism in Iceland has been Israel will become the leading mall company in Israel.
Country Data booming over the past two years in spite of the eruption of Country Data Israeli companies and financial institutions, realizing their as-
the volcano Eyjafjallajokull in March 2010. sets abroad and reinvesting in Israel, as well as the
Area (Sq Mi) Many office, retail and residential development projects have Area (Sq Mi)
increase of foreign investors attracted by the relative good
40,000 8,522
been delayed or cancelled, and in the immediate future such shape of the Israeli market compared to the rest of the world,
new projects are not likely to be started. Manufacturing and have created an important demand for yield properties. As a
GDP Growth -3.01% GDP Growth 4.2%
industrial property developments for specific use are in result prices have increased and yields have diminished.
process and that kind of developments activity is likely to The market is forecast to show continuing improvement for
GDP 2010 (US$ B) $12.77 GDP 2010 (US$ B) $201.25
increase in 2011 and 2012. The Icelandic government has 2011. Prices in the retail market will continue to increase
applied for Iceland to become a member of the EU, and most next year. Also, financial institutions are still reluctant to
GDP/Capita (US$) $39,562.89 GDP/Capita (US$) $27,085.13 invest abroad after the huge loss they suffered in Eastern
likely there will be national elections next year where it
will be decided whether Iceland joins the EU or not. If that Europe and will keep looking for yield properties in Israel,
Inflation Rate 2.6%
happens, Iceland will most likely adapt the Euro as the legal
Inflation Rate 2.3% causing an increase of price in the investment market.
Unemployment
currency, replacing the Icelandic krona. Unemployment
8.6% 7.4%
Rate Rate
Reykjavik At A Glance Tel Aviv At A Glance

Conversion: 122 ISK = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 3.57 NIS = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) ISK 1,300.00 ISK 2,400.00 $ 12.94 $ 23.89 N/A New Construction (AAA) NIS 100.00 NIS 130.00 $ 31.23 $ 40.60 10.00%
Class A (Prime) ISK 1,300.00 ISK 2,400.00 $ 12.94 $ 23.89 N/A Class A (Prime) NIS 90.00 NIS 120.00 $ 28.10 $ 37.47 8.00%
Class B (Secondary) ISK 800.00 ISK 1,500.00 $ 7.96 $ 14.93 N/A Class B (Secondary) NIS 65.00 NIS 75.00 $ 20.30 $ 23.42 10.00%
New Construction (AAA) ISK 1,200.00 ISK 1,700.00 $ 11.94 $ 16.92 N/A New Construction (AAA) NIS 75.00 NIS 80.00 $ 23.42 $ 24.98 25.00%
Class A (Prime) ISK 1,200.00 ISK 1,700.00 $ 11.94 $ 16.92 N/A Class A (Prime) NIS 65.00 NIS 70.00 $ 20.30 $ 21.86 14.00%
Class B (Secondary) ISK 700.00 ISK 1,200.00 $ 6.97 $ 11.94 N/A Class B (Secondary) NIS 45.00 NIS 50.00 $ 14.05 $ 15.61 15.00%
Bulk Warehouse ISK 350.00 ISK 1,100.00 $ 3.48 $ 10.95 N/A Bulk Warehouse NIS 34.00 NIS 38.00 $ 10.62 $ 11.87 15.00%
Manufacturing ISK 350.00 ISK 1,100.00 $ 3.48 $ 10.95 N/A Manufacturing NIS 28.00 NIS 30.00 $ 8.74 $ 9.37 15.00%
High Tech/R&D ISK 800.00 ISK 1,500.00 $ 7.96 $ 14.93 N/A High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center ISK 1,200.00 ISK 3,000.00 $ 11.94 $ 29.86 N/A Downtown NIS 130.00 NIS 160.00 $ 40.60 $ 49.96 5.00%
Neighborhood Service Centers ISK 800.00 ISK 1,400.00 $ 7.96 $ 13.94 N/A Neighborhood Service Centers NIS 140.00 NIS 170.00 $ 43.72 $ 53.09 N/A
Community Power Center (Big Box) ISK 800.00 ISK 1,400.00 $ 7.96 $ 13.94 N/A Community Power Center (Big Box) NIS 80.00 NIS 90.00 $ 24.98 $ 28.10 N/A
Regional Shopping Centers/Malls ISK 2,000.00 ISK 3,500.00 $ 19.91 $ 34.84 N/A Regional Malls NIS 80.00 NIS 100.00 $ 24.98 $ 31.23 N/A
Solus Food Stores ISK 800.00 ISK 1,400.00 $ 7.96 $ 13.94 N/A Solus Food Stores N/A N/A N/A N/A N/A
Office in CBD ISK 61,000.00 ISK 100,000.00 $ 2,204,094.85 $ 3,613,270.24 Office in CBD NIS 3,000.00 NIS 3,500.00 $ 3,400,724.93 $ 3,967,512.42
Land in Office Parks ISK 10,000.00 ISK 30,000.00 $ 361,327.02 $ 1,083,981.07 Land in Office Parks NIS 2,000.00 NIS 2,400.00 $ 2,267,149.96 $ 2,720,579.95
Land in Industrial Parks ISK 10,000.00 ISK 30,000.00 $ 361,327.02 $ 1,083,981.07 Land in Industrial Parks NIS 1,200.00 NIS 1,600.00 $ 1,360,289.97 $ 1,813,719.96
Office/Industrial Land - Non-park ISK 10,000.00 ISK 30,000.00 $ 361,327.02 $ 1,083,981.07 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land ISK 10,000.00 ISK 30,000.00 $ 361,327.02 $ 1,083,981.07 Retail/Commercial Land N/A N/A N/A N/A
Residential ISK 25,000.00 ISK 100,000.00 $ 903,317.56 $ 3,613,270.24 Residential N/A N/A N/A N/A

Almaty, Kazakhstan Kuwait
The recent measures taken by the State to support the 2010 proved to be a turning point for Kuwait’s economy. The
economy have resulted in a stabilization of the Kazakhstan Parliament approved an ambitious $104 billion, four-year plan
economy and the real estate market as well. But it is still that aims to boost Kuwait’s non-oil income four-fold, and
too early to speak about a complete stabilization of the real implement development plans to achieve Kuwait’s vision of
estate market. The main factors hindering the development becoming the region’s financial and trade center by 2035.
of the real estate sector here are high interest rates and lack Kuwait’s budget surplus reached 6.44 billion dinars ($22.34
of investment (with the exception of public funding) in the billion) in the fiscal year that ended in March 2010 with oil
construction sector. prices pushing $70 a barrel.
2010 was characterized by relatively stable rental rates in The robust growth of real estate activity in 2010 had a
the office market. Three new Class B office buildings entered positive impact on all sectors of the local economy driven
the market in 2010. The total office inventory, including by the gradual recovery of the real estate sector from the
Class A and B, is currently at 950,000 SM. The following global financial turndown. In the past, trading and financing
positive trends are now being observed: a reverse flow in residential projects was restricted by laws, the negative
of tenants from low class to high class office buildings; a impact of which has since faded. The key challenges faced
growing demand in Class B properties; and a reduction in by the real estate market is the substantial volume of supply
the vacancy rate. in the commercial and residential investment sectors and
Contact Contact significant undersupply of private residential housing.
The retail market has been less affected by the economic
NAI Aristan NAI Kuwait In the office sector, supply now outstrips demand. In Kuwait
crisis. An increase in activity has been observed throughout
+ 7 727 278 94 08 +1 965 22437717 City, rentals contracted by 45% from peak rents in 2007
the year. Five shopping centers came on the market in
2010. The total market inventory comprising modern shop- averaging KD 10/SM, and in other areas office rentals fell by
ping center space is 619,500 SM. In 2010 representatives 20-25%. New office towers under construction include Hamra
of some well known retail brands announced their intention Tower, United Tower and Kuwait Business Town by Mazaya.
to enter the Almaty market. The trend of attracting new Presently Kuwait has more than 50 malls with leasable floor
brands and experienced international players will certainly space of approximately 675,000 SM predominately located
help to accelerate the development of this segment of the in the City Center, Hawally, Salmiya and Fahaheel. Interior
commercial real estate market, in particular the emergence areas that are detached from the main urban areas are
of larger retail formats that are required for non-international witnessing new retail developments. The EKME group
Country Data brands. During 2010 we observed a high demand for Country Data opened the second Lulu Hypermarket in Qurain, The
quality retail space, the expansion of network operators, the Avenues mall, undergoing the Phase 3 expansion will
Area (Sq Mi) 1,052,100 emergence of new global brands and the emergence of Area (Sq Mi) 6,880 become the dominant retail destination in Kuwait. The rental
shopping centers towards the city limits. rates of industrial plots remained stable, with an average
GDP Growth 5.4% GDP Growth 2.3% rental KD 11/SM.
According to our estimates, the total area of warehouse space
is currently 800,000 SM. More than 70% of the existing In the residential sector there is a significant shortage of
GDP 2010 (US$ B) $129.76 GDP 2010 (US$ B) $117.32 supply in private housing for the Kuwaiti population, hence
amount is in Soviet time stock. Slow growth of the national
economy of Kazakhstan, coupled with a decrease in business the state aims to complete more than 70,000 housing units
GDP/Capita (US$) $8,326.45 activity, has led to a 30% increase in the vacancy rate. Rental GDP/Capita (US$) $32,530.48 by the end of 2015 to meet the housing needs. The rental
rates range from $30-$140/SM per year. apartment segment, which relies heavily on the expatriate
Inflation Rate 7.6% Inflation Rate 4.1% population for demand, is expected to stabilize with the
Positive trends have not resulted in a stable economy but recovering economy. The average asking rate for single-
Unemployment
recovery is expected over the next two years. However, Unemployment bedroom units stands at KD 170, two-bedroom at KD 220
7.8% 1.6%
Rate poor action by the banks could result in a delay. The total Rate and three-bedroom apartments at KD 380.
stabilization and continued growth in the real estate market
Interest Rate 9.0% is only possible with the cooperation of the banking sector. Interest Rate 6.2% Major development projects planned through private sector
partnerships include the $7 billion metro, a railway and
several power projects including renewable energy properties,
the $3 billion tourist development of Failaka Island and five
projects at Kuwait airport.
Almaty At A Glance Kuwait At A Glance
Conversion 149.65 KZT = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 0.28 KWD = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) KZT 4,300.00 KZT 8,500.00 $ 32.03 $ 63.32 35.00% New Construction (AAA) KWD 7.00 KWD 12.00 $ 27.97 $ 47.95 6.00%
Class A (Prime) KZT 4,410.00 KZT 8,820.00 $ 32.85 $ 65.71 11.00% Class A (Prime) KWD 8.00 KWD 12.00 $ 31.97 $ 47.95 4.00%
Class B (Secondary) KZT 2,499.00 KZT 6,174.00 $ 18.62 $ 45.99 33.00% Class B (Secondary) KWD 5.00 KWD 7.00 $ 19.98 $ 27.97 2.00%
New Construction (AAA) KZT 3,300.00 KZT 5,450.00 $ 24.58 $ 40.60 18.00% New Construction (AAA) KWD 6.00 KWD 8.00 $ 23.97 $ 31.97 3.00%
Class A (Prime) KZT 3,400.00 KZT 5,600.00 $ 25.33 $ 41.72 8.00% Class A (Prime) KWD 6.00 KWD 8.00 $ 23.97 $ 31.97 2.00%
Class B (Secondary) KZT 2,100.00 KZT 3,900.00 $ 15.64 $ 29.05 21.00% Class B (Secondary) KWD 5.00 KWD 6.00 $ 19.98 $ 23.97 1.00%
Bulk Warehouse KZT 370.00 KZT 790.00 $ 2.76 $ 5.89 30.00% Bulk Warehouse KWD 3.00 KWD 4.00 $ 11.99 $ 15.98 3.00%
Manufacturing KZT 1,000.00 KZT 1,680.00 $ 7.45 $ 12.52 30.00% Manufacturing KWD 4.00 KWD 18.00 $ 15.98 $ 71.92 3.00%
High Tech/R&D KZT 1,000.00 KZT 1,680.00 $ 7.45 $ 12.52 30.00% High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown KZT 7,450.00 KZT 17,980.00 $ 55.50 $ 133.94 3.00% Downtown KWD 20.00 KWD 30.00 $ 79.92 $ 119.87 2.00%
Neighborhood Service Centers KZT 4,440.00 KZT 10,670.00 $ 33.08 $ 79.49 5.00% Neighborhood Service Centers KWD 8.00 KWD 20.00 $ 31.97 $ 79.92 1.00%
Community Power Center N/A N/A N/A N/A N/A Community Power Center (Big Box) KWD 18.00 KWD 25.00 $ 71.92 $ 99.89 2.00%
Regional Shopping Centres/Malls KZT 3,770.00 KZT 9,700.00 $ 28.08 $ 72.26 10.00% Regional Shopping Centres/Malls KWD 25.00 KWD 35.00 $ 99.89 $ 139.85 2.00%
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores KWD 8.00 KWD 18.00 $ 31.97 $ 71.92 1.00%
Office in CBD N/A N/A N/A N/A Office in CBD KWD 4,500.00 KWD 7,000.00 $ 65,271,978.54 $ 101,534,188.85
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks KWD 500.00 KWD 1,300.00 $ 7,252,442.06 $ 18,856,349.36
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land KWD 3,000.00 KWD 4,500.00 $ 43,514,652.36 $ 65,271,978.54
Residential N/A N/A N/A N/A Residential KWD 250.00 KWD 1,000.00 $ 3,626,221.03 $ 14,504,884.12

Luxembourg City, Luxembourg Amsterdam, The Netherlands
Luxembourg City, capital of the Grand-Duché de Luxem- The Dutch economy is known for the food, chemistry, refining
bourg, represents a population of approximately 85,000 and electrical equipment manufacturing sectors. The most
inhabitants, of which more than 60% are foreigners. Very important companies are Shell, Unilever, DSM, AkzoNobel,
few European capital cities serve up such an impressive Philips, Aegon, ING Groep, Rabobank Groep, Heineken,
array of contrasts as Luxembourg. After Malta, Luxembourg TNT and Randstad. The Dutch economy showed a slow
is the second smallest member state in the current recovery in the beginning of 2010 with a GDP growth of
European Union. Nevertheless, it was present at the birth of 0.2%. The expectation for 2010 is an unpretentious growth
a united Europe, along with Belgium, Germany, France, Italy of 1.5% with an unemployment figure of around 6.5%.
and The Netherlands. The office market showed a total take-up of approximately
Thanks to the recovery in the global economy and the wide 480,000 SM of office space in the first six months of 2010,
range of properties for re-launching the macro-economy, which indicates a decline of 14% in comparison to the same
economic recovery has also begun in Luxembourg. period in 2009. The outlook for 2010 is a total take-up of
Uncertainty about the duration and severity of the crisis has approximately 1 million SM, which is the lowest since 1995.
forced developers to adapt their developments according to The availability increased with approximately 300,000 SM
the economic situation. The take-up in the first half of the to a total inventory of 6.58 million SM with an increasing
year was reflected in a significant rise in demand in the Q2 gap between prime cities and smaller towns. The prime
Contact 2010 numbers. This recovery is also evident from the enor- Contact rents have remained stable but the average rents are slowly
NAI Belux mous increase in the number of transactions. NAI Netherlands declining. Substantial incentives are being offered to support
+352 22 9999 55 51 +3120 364 0007 rental rates. Among the largest office transactions in 2010
The city of Luxembourg within the Grand Duchy is still the
preferred location for tenants and remained so in the first were RET’s lease of 12,000 SM and Shell Downstream’s
half of 2010, accounting for more than 75% of the total lease of 12,000 SM, both in Rotterdam.
demand absorbed. After an increase in 2009, available Industrial take-up remained stable in the first six months
office space in Luxembourg continued to increase in the first of 2010 with a total of approximately 950,000 SM in
half of 2010. In conjunction with the low economic growth comparison to the same period in 2009. The outlook for
and the rise in unemployment (estimated at 6% for 2010), 2010 is a total take-up of 1.9 million SM. Vacancies have
office vacancies combined with speculative deliveries have increased 7% to 9.6 million SM. The average effective rents
increased the volume of office space available in the market. are slowly declining due to substantial incentives. Among
Country Data The vacancy rate now stands at 7.2% compared to 3.8% Country Data the largest transactions were Graaco’s lease of 65,000 SM
for 2009. Given the large amount of office space available, in Coevorden and Fetim’s lease of 45,000 SM in Amsterdam.
Area (Sq Mi) 998,000 prime rents have decreased and are currently at €36/SM Area (Sq Mi) 144,220
Retail activity has increased in the main streets and prime
per month for quality office space in the CBD, representing shopping centers of the larger cities. In the smaller regional
GDP Growth 3.0% a drop of 10% compared with the end of 2009. There GDP Growth 1.8 %
cities the demand is relatively low. The rent levels in the
has also been a leveling off in this number compared with large cities have remained stable, but in the smaller regional
GDP 2010 (US$ B) $52.43 Q1 2010. GDP 2010 (US$ B) $770.31 cities the rent levels are declining. The total investment
The investment market in Luxembourg, usually supported volume increased substantially in the first six months of
GDP/Capita (US$) $104,390.20 by the German funds, has been very slow. Luxembourg is GDP/Capita (US$) $46,418.33 2010 to nearly €2.6 billion. Prime yields are between 5.75-
also suffering from a lack of product diversity, while at the 8.0%. The outlook for full-year 2010 is a total investment
Inflation Rate 2.3% same time the products available in the market lack appeal. Inflation Rate 1.3% volume of more than €5 billion, which indicates an increase
No major transactions were concluded and the products that of 43% in comparison with 2009. Among the largest
Unemployment 5.8% were sold have a value of less than €10 million. With the Unemployment 4.2% transactions are an ING REIM portfolio sold for €152 million
Rate Rate
weak activity in the investment market predicted to be over, to a consortium of investors, and Building “De Facet”
Interest Rate 1.0% the prime yield is estimated at 6.4%, which is a stable level Interest Rate 1.0% Terwijde Singel 1 Utrecht at 22,200 SM sold for €65 million
compared to the 2009 rate. The Luxembourg GDP showed to Nordcapital.
Population (Millions) 0.502 a positive growth of 1.9 % in 2010 and should continue its Population (Millions) 4.202
recovery with 2.8 % growth in 2011.
Luxembourg At A Glance Amsterdam At A Glance

Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction EUR 24.00 EUR 36.00 $ 37.16 $ 55.74 7.40% New Construction (AAA) N/A N/A N/A N/A N/A
New Construction N/A N/A N/A N/A N/A Class A (Prime) EUR 170.00 EUR 370.00 $ 21.94 $ 47.74 10.00%
Class A (Prime) N/A N/A N/A N/A N/A Class B (Secondary) EUR 100.00 EUR 160.00 $ 12.90 $ 20.64 20.00%
Class B (Secondary) N/A N/A N/A N/A N/A Average City Centre EUR 170.00 EUR 200.00 $ 21.94 $ 25.81 N/A
Bulk Warehouse N/A N/A N/A N/A N/A Bulk Warehouse EUR 25.00 EUR 110.00 $ 3.23 $ 14.19 N/A
Manufacturing N/A N/A N/A N/A N/A Light Industrial N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center EUR 50.00 EUR 100.00 $ 77.42 $ 154.84 N/A City Center EUR 1,700.00 EUR 2,800.00 $ 219.35 $ 361.29 N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers EUR 300.00 EUR 550.00 $ 38.71 $ 70.97 N/A
Community Power Center (Big Box) N/A N/A N/A N/A N/A Community Power Center (Big Box) EUR 125.00 EUR 150.00 $ 16.13 $ 19.35 N/A
Regional Shopping Centers/Malls N/A N/A N/A N/A N/A Regional Shopping Centers/Malls N/A N/A N/A N/A N/A
Office in CBD N/A N/A N/A N/A Office in CBD EUR 1,172.00 EUR 2,091.00 $ 6,587,393.12 $ 11,752,763.67
Land in Office Parks N/A N/A N/A N/A Land in Office Parks EUR 320.00 EUR 811.00 $ 1,798,605.63 $ 4,558,341.15
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks EUR 100.00 EUR 384.00 $ 562,064.26 $ 2,158,326.76
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park EUR 100.00 EUR 384.00 $ 562,064.26 $ 2,158,326.76
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land EUR 150.00 EUR 23,500.00 $ 843,096.39 $ 132,085,101.03
Residential N/A N/A N/A N/A Residential EUR 310.00 EUR 4,100.00 $ 1,742,399.21 $ 23,044,634.65

Oslo, Norway Warsaw, Poland
Given the downturn in the market over the past several years, Warsaw, the capital of Poland, is located in central eastern
the Norwegian economy has performed well throughout 2010. Poland and has nearly 2 million inhabitants. Warsaw is often
Government stimulus packages, funded mainly by a seen as the first stop for foreign investors interested in
decrease in the state pension fund as opposed to borrowing, development, office, retail and industrial investments, mainly
have had a positive impact in stabilizing the economy. The because the Polish market is one of the largest and most
unemployment rate of 3.5% is well below the EU average. liquid in this part of Europe. In 2010 Poland retained its
GDP has increased by 0.6% and is expected to grow top position in the ranking of the most attractive investment
to 1.8% throughout 2011. destinations in the CEE region.
Expectations among both households and investors are The investment market is more active than in 2009 with an
more positive, with rising corporate investment and low increase in transactions, especially in Warsaw. It should be
interest rates helping to stimulate spending. Most of the noted that total investment volume in Poland for the first half
demand for commercial property investments is still low risk, of 2010 has already amounted to €621 million, almost 90%
low yield. A more stable financial market means credit for of the entire volume in 2009. It is expected that the 2010
such investments is easier to secure whereas higher risk Polish investment volumes may well exceed €2 billion.
projects are still hard to finance. The value of commercial
property transactions has almost doubled with the total The total modern office supply in Warsaw increased by
Contact volume expected to be in the region of NOK 30 billion by Contact 62,500 SM and reached over 3.3 million SM at the start of
year’s end. 2010. The supply of new office space should reach a total
NAI FirstPartners NAI Estate Fellows
190,000 SM by the end of 2010. Almost 8% of modern
+47 2301 1400 There were several large transactions in 2010 including Bulk +48 22 379 7300
office supply in Warsaw remains vacant with a 6% vacancy
Eiendom’s recent sale of three logistics properties to Store- in the CBD. The vacancy rate is expected to decrease due
brand Livforsikring for NOK 1,450,000,000. Earlier in to an increased demand for available office space and a
the year Genesta bought both Karl Johan’s Gate 14 and relatively low number of new developments. Currently, rents
Kirkegata 23-25 from Aberdeen for NOK 630 million. remain stable with the average asking rate in the CBD at
However, the most significant transaction in 2010 was the €21.50/SM per month.
sale of Sektor Eiendom’s shopping center portfolio to NIAM
AB for approximately NOK 5 billion. New projects in the retail market currently meet the increasing
retailer demand. Hence, Warsaw looks promising among
The rental market has shown signs of improvement over the high-end brands. New retail space that was delivered to the
Country Data last 12 months, the general consensus being that prices Country Data
market reached 250,000 SM in 2010. Notably low retail
have bottomed out and will continue to gradually increase
Area (Sq Mi)
density per inhabitant in Warsaw provides ample opportu-
125,013 in 2011. As a consequence, yields have shown a decreasing Area (Sq Mi) 120,728
nities for developers and retailers. The demand for Warsaw
tendency while moderately increasing capital values.
shopping centers strengthened but the current rents are
Several prime office transactions have reflected yields as quite stable. The vacancy rate currently fluctuates around
low as 6% while prime logistics, industrial and retail yields 1%. The highest rents in shopping centers vary between
GDP 2010 (US$ B) $400.66 have also declined between 0.3 % and 0.8%. Perhaps the GDP 2010 (US$ B) $438.88 €65 to €85/SM per month. Rents in central High Street
best performing sectors have been finance, law, oil services locations range from €75 to €90/SM per month.
GDP/Capita (US$) $881,634.72 and of course the public sector. As a result office vacancies GDP/Capita (US$) $11,521.64
for the most part have come down in the CBD areas while Warsaw has the biggest warehouse stock in Poland with
secondary locations such as Skøyen and Lysaker have seen over 2.5 million SM. Planned developments are still on hold;
more space coming back to the market. however, take-up remains stable, which means lower
Unemployment Unemployment
vacancy rates are projected for 2011.
3.5% Given the steady pace of Norway’s recovery and the govern- 9.8%
Rate Rate Optimistic economic forecasts are positively influencing the
ment’s cautious approach to fiscal policy, no major fluctua-
Interest Rate 2.0% tions are expected in the near future. However, the economy Interest Rate 3.5% way Poland is perceived among foreign investors. The most
is robust and the outlook for 2011 remains positive. Rents are prominent developments will emerge in the following areas:
Population (Millions) 4.9081 Population (Millions) 38.092 data search and analysis, market and financial research,
expected to continue on a gradual incline and vacancies are
expected to decline. This will continue to push down yields healthcare, engineering and design.
and provide attractive opportunities for investors.
Oslo At A Glance Poland At A Glance
Conversion 5.80 NOK = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction NOK 2,500.00 NOK 3,100.00 $ 40.04 $ 49.65 1.00% New Construction EUR 300.00 EUR 360.00 $ 38.71 $ 46.45 29.00%
Class A (Prime) NOK 2,400.00 NOK 3,000.00 $ 38.44 $ 48.05 6.00% Class A (Prime) EUR 216.00 EUR 312.00 $ 27.87 $ 40.26 7.60%
Class B (Secondary) NOK 1,600.00 NOK 2,100.00 $ 25.63 $ 33.64 7.50% Class B (Secondary) EUR 198.00 EUR 228.00 $ 25.55 $ 29.42 8.00%
New Construction (AAA) NOK 1,500.00 NOK 2,100.00 $ 24.03 $ 33.64 4.00% New Construction EUR 180.00 EUR 198.00 $ 23.23 $ 25.55 30.00%
Class A (Prime) NOK 1,600.00 NOK 2,000.00 $ 25.63 $ 32.04 6.00% Class A (Prime) EUR 180.00 EUR 198.00 $ 23.23 $ 25.55 8.40%
Class B (Secondary) NOK 1,100.00 NOK 1,400.00 $ 17.62 $ 22.42 10.00% Class B (Secondary) EUR 138.00 EUR 168.00 $ 17.81 $ 21.68 15.00%
Bulk Warehouse NOK 550.00 NOK 1,000.00 $ 8.81 $ 16.02 6.00% Bulk Warehouse EUR 57.00 EUR 60.00 $ 7.35 $ 7.74 19.80%
Manufacturing NOK 450.00 NOK 800.00 $ 7.21 $ 12.81 6.00% Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D NOK 750.00 NOK 1,050.00 $ 12.01 $ 16.82 6.00% High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center NOK 2,500.00 NOK 11,000.00 $ 40.04 $ 176.19 5.00% City Center EUR 900.00 EUR 1,080.00 $ 116.13 $ 139.35 1.30%
Neighborhood Service Centers NOK 1,200.00 NOK 1,500.00 $ 19.22 $ 24.03 6.00% Neighborhood Service Centers EUR 72.00 EUR 120.00 $ 9.29 $ 15.48 N/A
Community Power Center(Big Box) NOK 1,300.00 NOK 2,500.00 $ 20.82 $ 40.04 7.00% Community Power Center (Big Box) EUR 360.00 EUR 540.00 $ 46.45 $ 69.68 N/A
Regional Shopping Centers/Malls NOK 1,800.00 NOK 5,000.00 $ 28.83 $ 80.09 7.00% Regional Shopping Centers/Malls EUR 180.00 EUR 300.00 $ 23.23 $ 38.71 N/A
Solus Food Stores NOK 900.00 NOK 1,500.00 $ 14.42 $ 24.03 7.00% Solus Food Stores EUR 132.00 EUR 168.00 $ 17.03 $ 21.68 N/A
Office in CBD NOK 10,000.00 NOK 20,000.00 $ 6,977,349.43 $ 13,954,698.86 Office in CBD EUR 2,000.00 EUR 3,000.00 $ 11,241,285.19 $ 16,861,927.79
Land in Office Parks NOK 3,000.00 NOK 6,000.00 $ 2,093,204.83 $ 4,186,409.66 Land in Office Parks EUR 600.00 EUR 1,500.00 $ 3,372,385.56 $ 8,430,963.90
Land in Industrial Parks NOK 1,500.00 NOK 3,000.00 $ 1,046,602.41 $ 2,093,204.83 Land in Industrial Parks EUR 65.00 EUR 100.00 $ 365,341.77 $ 562,064.26
Office/Industrial Land - Non-park NOK 1,000.00 NOK 2,500.00 $ 697,734.94 $ 1,744,337.36 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land NOK 1,500.00 NOK 4,000.00 $ 1,046,602.41 $ 2,790,939.77 Retail/Commercial Land EUR 1,500.00 EUR 2,500.00 $ 8,430,963.90 $ 14,051,606.49
Residential NOK 1,000.00 NOK 5,000.00 $ 697,734.94 $ 3,488,674.72 Residential EUR 400.00 EUR 1,000.00 $ 2,248,257.04 $ 5,620,642.60

Doha City, Qatar Bucharest, Romania
The State of Qatar is a peninsula located on the western side Following a hopeful beginning to 2010 and despite the
of the Arabian Gulf. Doha is the capital of the country. Qatar IMF loan of €22 billion, the expectation of the economy’s
is one of the fastest growing economies and is the richest performance has now been reduced from 1.5% to 0.5%.
country in the world with the largest GDP per capita income. The latest estimates for 2011 are bleak with no economic
Qatar has the third largest natural gas reserves in the world growth expected. The government has begun austerity
and it shaped the country to be one of the most competitive measures, including a rise in VAT from 19% to 24%.
Arab economies. Office supply increased with more than 200,000 SM of
Qatar’s construction sector is growing swiftly, propelled by the office space delivered to the market during 2010, resulting
country’s powerful economy and the thriving real estate sector. in a vacancy rate of approximately 20% in Q4 2010. Rents
The foreign-investor friendly laws and regulations, including continue in a downward trend with prime rents slipping from
generous financial incentives and tax breaks are the key €24/SM down to €20/SM per month. Prime yields have also
factors for attracting real estate firms to the country. The increased during 2010 and are currently around 9.25%, but
positive aspects in the market are threefold: developers bring this has yet to be confirmed by a major transaction. Prime
together the timely transfer of high quality, value-added proj- retail rents have fallen to a level that has encouraged
ects; banks have improved in managing the risks associated tenants to expand their networks and vacancy has begun
with over-exposure to the real estate sector; and government to decline in both High Street shops and existing shopping
Contact efforts have overcome the economic difficulties, all resulting Contact centers. New development has been limited to big box
NAI Qatar in solid fundamentals in the Qatar real estate market. NAI Property Partners retailers and the expansion of some well-performing prop-
+974 431 6717 +1 40 21 667 7105 erties due to the emergence of several new cross-border
There is promising growth in the demand for residential
apartment units/flats. There is strong demand for both lease- retailers. There were two major retail projects delivered this
hold and freehold properties in Qatar. The average rate year: Sun Plaza in Bucharest at 80,000 SM and Atrium in
(leasehold) for a three-bedroom apartment is $2,656 per Arad with 29,500 SM.
month, $2,152 for a two-bedroom apartment and $1,738 During 2010, the total stock of modern industrial/warehouse
for a one-bedroom apartment. The average asking rate for space surpassed 1million SM in the Bucharest/Ilfov area.
a villa is $4,220 per month. For freehold properties, the rate However, nearly all development has been of a turn-key
is $5,070/SM. basis and the demand for speculative facilities remains
There is excellent demand for office space in Doha with the weak. In Bucharest, prime rents have fallen below €4/SM
Country Data Country Data per month. Regional cities such as Arad, Brasov, Cluj and
vacancy rates remaining very low. The vacancy rate in the
CBD is around 10% and 7% in suburban areas where the Timisoara continue to attract industrial off-shoring leasing
Area (Sq Mi) 4,473 Area (Sq Mi) 92,043 albeit at a far reduced level from recent years. The level of
average rate per SM is lower than in the CBD but with facil-
ities similar to those in the CBD. The average asking rate investment activity has remained very low throughout 2010
GDP Growth 8.7%
for office space is $57/SM in the CBD and $44/SM in the GDP Growth -1.9% with only a handful of significant transactions taking place.
suburban areas. For freehold, units the rate is $4,795/SM. Retail has been the dominant sector for transactions but the
GDP 2010 (US$ B) $357,86 GDP 2010 (US$ B) $158.39 majority of these transactions are between co-developers
The retail sector looks to have a very promising future going
into 2011. The retail market is comprised of traditional High buying each other out. Recent key transactions include: Iris
GDP/Capita (US$) $90,13 GDP/Capita (US$) $ 7,390.70 shopping center Pitesti, a property anchored by Auchan and
Street shops and modern malls. The average rate in the
retail sector is $58/SM. The promising nature of the retails Bricostore that was sold by Avrig 35 to NEPI; 50% of the
Inflation Rate 5.7%
segment is mainly attributed to the fall of inflation and Inflation Rate 5.9% shares in Atrium Center Arad were bought by Arcadom (the
increase in consumer spending. There is a good demand for construction company component of Trigranit Corporation)
Unemployment 0.4% Unemployment 7.2% for €35 million; and Tiago Mall Oradea, which never opened
Rate warehouse space in Qatar with the average rate in this sector Rate
at $21/SM. and was sold at public auction and acquired by Banasea
Interest Rate 5.6% Interest Rate 8.0% Investments.
Doha City At A Glance Bucharest At A Glance

Conversion 3.64 QAR = 1 US$ RENT/M2/Mo US$ RENT/SF/YR Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction QAR 180.00 QAR 250.00 $ 55.13 $ 76.57 10.00% New Construction (AAA) EUR 17.00 EUR 20.00 $ 26.32 $ 30.97 9.00%
Class A (Prime) QAR 160.00 QAR 210.00 $ 49.00 $ 64.32 3.00% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) N/A N/A N/A N/A N/A Class B (Secondary) EUR 8.00 EUR 15.00 $ 12.39 $ 23.23 15.00%
New Construction (AAA) QAR 150.00 QAR 200.00 $ 45.94 $ 61.25 7.00% New Construction (AAA) EUR 10.00 EUR 12.00 $ 15.48 $ 18.58 15.00%
Class A (Prime) QAR 120.00 QAR 160.00 $ 36.75 $ 49.00 5.00% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) QAR 70.00 QAR 105.00 $ 21.44 $ 32.16 5.00% Class B (Secondary) EUR 7.00 EUR 9.00 $ 10.84 $ 13.94 19.00%
Bulk Warehouse QAR 50.00 QAR 70.00 $ 15.31 $ 21.44 15.00% Bulk Warehouse EUR 3.00 EUR 4.00 $ 4.65 $ 6.19 15.00%
Manufacturing QAR 60.00 QAR 110.00 $ 18.38 $ 33.69 N/A Manufacturing EUR 1.50 EUR 4.00 $ 2.32 $ 6.19 15.00%
RETAIL RETAIL
City Center QAR 740.00 QAR 825.00 $ 226.64 $ 252.67 N/A City Center EUR 25.00 EUR 70.00 $ 38.71 $ 108.39 9.00%
Neighborhood Service Centers QAR 200.00 QAR 350.00 $ 61.25 $ 107.19 N/A Neighborhood Service Centers EUR 5.00 EUR 20.00 $ 7.74 $ 30.97 9.00%
Community Power Center(Big Box) N/A N/A N/A N/A N/A Community Power Center (Big Box) N/A N/A N/A N/A N/A
Regional Shopping Centers/Malls QAR 575.00 QAR 770.00 $ 176.11 $ 235.83 N/A Regional Shopping Centers/Malls EUR 6.00 EUR 25.00 $ 9.29 $ 38.71 15.00%
Solus Food Stores QAR 167.00 QAR 235.00 $ 51.15 $ 71.97 5.00% Solus Food Stores N/A N/A N/A N/A N/A
Office in CBD QAR 17,500.00 QAR 24,000.00 $ 4,807.69 $ 6,593.41 Office in CBD EUR 1,500.00 EUR 2,500.00 $ 8,430,963.90 $ 14,051,606.49
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks EUR 20.00 EUR 50.00 $ 112,412.85 $ 281,032.13
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park EUR 35.00 EUR 100.00 $ 196,722.49 $ 562,064.26
Retail/Commercial Land QAR 7,500.00 QAR 17,250.00 $ 2,060.44 $ 4,739.01 Retail/Commercial Land EUR 130.00 EUR 300.00 $ 730,683.54 $ 1,686,192.78
Residential QAR 1,200.00 QAR 5,900.00 $ 329.67 $ 1,620.88 Residential EUR 80.00 EUR 1,800.00 $ 449,651.41 $ 10,117,156.67

Moscow, Russia St. Petersburg, Russia
Among other BRIC emerging markets, Russia has been the The second largest city in Russia, St. Petersburg is located
most impacted by the global economic crisis. Nevertheless, at the crossroads of Finland and the Baltic countries, and
the economy, still very dependent on raw materials and oil historically has benefited from the positive influence of the
prices, has also seen a relatively faster recovery as Russian dynamic economy in this region. Large international and
GDP grew by 4.3% in 2010. Moscow, as the capital and Russian companies generally decide to be headquartered
largest city of the country, has seen the fastest recovery in Moscow, so St. Petersburg has been less impacted by
within Russia. the global economic crisis than the rival capital city.
The overall vacancy rate is now about 20% for office space, a Prime office and retail rents, which used to be much lower
slight improvement in comparison with late 2009. Prime office than in Moscow, are now equivalent. Rental rates reach
rents at about $800/SM per year are stable at their September $800/SM for the best office buildings in the city, and
2009 level but down around 50% compared with 2008. The $2,500/SM for prime retail properties, at the same level as
share of subleases is still increasing. Good news from the in 2009. The total supply of retail space in St Petersburg
employment market combined with a growing economy are amounts to 3.47 million SM, or 760 SM per thousand
reasons to be optimistic for 2011, which should see a strong inhabitants. The overall supply of quality office space is
revival in demand for office space. about 2.5 million SM, well below the 11 million SM of office
As of Q3, the total supply of retail space in Moscow amounts space in Moscow.
Contact Contact
to 6.1 million SM, which represents 270 SM per thousand The industrial market is still largely undersupplied, and rents
NAI Becar NAI Becar
inhabitants. Consecutively to the flight to quality that resisted the impact of the crisis better than other sectors.
+7 495 787 42 97 +7 812 490 70 01
followed the crisis, prime rents are now 5-7% higher than Prime warehouse rental rates were stable at $170/SM per
in January 2010, and prime shopping centers see very low year during 2010 and remain at a higher level than in
vacancy levels. Secondary shopping centers have not Moscow. The hospitality market, which had been strongly
recovered yet from the serious drop in both rentals and hit in 2009 with dropping occupancy rates, has seen a slight
occupancy level. Vacancy is still high at 20-30% for this sub- recovery. The overall occupancy is around 49%, while four-
market. Russian retailers’ turnover improved significantly in and five-star hotels are 60% occupied on average. Hospitality
the first half of 2010. Large retail chains are now expanding remains attractive to many investors due to the strong tourism
again in Moscow. potential of the region and lack of European standard
Financing is becoming more available and affordable. two- and three-star hotels in the city. Prime investment yields,
Country Data Country Data at the current 9-10%, are at the same level as in Moscow
Developers are active on projects that were put on hold one
or two years ago. The Russian hospitality market has been and are expected to remain stable over the next 12 months.
Area (Sq Mi) 6,601,668 Area (Sq Mi) 6,601,668 The domestic demand is interested in office and retail
relatively stable in 2010. Like in 2009, the occupancy level
for four- and five-star international hotels remains higher at properties selling at lower yields of 6% or 8% and volumes
GDP Growth 4.0%
65%. The overall average occupancy level has slightly GDP Growth 4.0% within a range of $5 million to $30 million on average.
increased from 50% in 2009 to 55% in November 2010 International investors considering larger volumes of invest-
GDP 2010 (US$ B) $1,476.91 GDP 2010 (US$ B) $1,476.91
and is expected to improve further in 2011. Prime office and ment, $40 million and up, believe the risk for investing in
retail yields compressed to 10% from 11-12% in December Russia is not properly rewarded at these levels. They are
GDP/Capita (US$) $10,521.79 2009. GDP/Capita (US$) $10,521.79 ready to consider prime yielding office or retail properties
A majority of Russian opportunistic investors believe the from 9% and up. Paradoxically, many owners are still trying
Inflation Rate 6.6%
market reached its bottom in late 2009, and they are now Inflation Rate 6.6% to lease or sell properties at pre-crisis prices, which results
active. Office yields should remain relatively stable over in a large gap between the offer and the demand. This
Unemployment 7.5% Unemployment imbalance is expected to progressively disappear over the
2011. Prices are expected to go up while very low current 7.5%
Rate Rate
rental rates and occupancy levels should mechanically next two years.
increase in Moscow’s still structurally undersupplied office
Population (Millions) 140.367 and retail market. Population (Millions) 140.367
Moscow At A Glance St. Petersburg At A Glance

RENT/M2/YR US$ RENT/SF/YR RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) $ 700.00 $ 850.00 $ 65.03 $ 78.97 20.00% New Construction (AAA) $ 350.00 $ 750.00 $ 32.52 $ 69.68 N/A
Class A (Prime) $ 700.00 $ 850.00 $ 65.03 $ 78.97 20.00% Class A (Prime) $ 360.00 $ 770.00 $ 33.44 $ 71.53 N/A
Class B (Secondary) $ 400.00 $ 600.00 $ 37.16 $ 55.74 20.00% Class B (Secondary) $ 170.00 $ 400.00 $ 15.79 $ 37.16 N/A
New Construction (AAA) $ 400.00 $ 600.00 $ 37.16 $ 55.74 N/A New Construction (AAA) $ 230.00 $ 415.00 $ 21.37 $ 38.55 N/A
Class A (Prime) $ 400.00 $ 600.00 $ 37.16 $ 55.74 N/A Class A (Prime) $ 200.00 $ 415.00 $ 18.58 $ 38.55 N/A
Class B (Secondary) $ 150.00 $ 500.00 $ 13.94 $ 46.45 N/A Class B (Secondary) $ 130.00 $ 330.00 $ 12.08 $ 30.66 N/A
Bulk Warehouse $ 90.00 $ 110.00 $ 8.36 $ 10.22 N/A Bulk Warehouse $ 95.00 $ 115.00 $ 8.83 $ 10.68 N/A
Manufacturing $ 90.00 $ 110.00 $ 8.36 $ 10.22 N/A Manufacturing $ 80.00 $ 105.00 $ 7.43 $ 9.75 N/A
High Tech/R&D $ 120.00 $ 130.00 $ 11.15 $ 12.08 N/A High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 2,500.00 $ 3,500.00 $ 232.26 $ 325.16 N/A City Center $ 800.00 $ 3,200.00 $ 74.32 $ 297.29 N/A
Neighborhood Service Centers $ 800.00 $ 1,500.00 $ 74.32 $ 139.35 N/A Neighborhood Service Centers $ 500.00 $ 900.00 $ 46.45 $ 83.61 N/A
Community Power Center $ 800.00 $ 1,500.00 $ 74.32 $ 139.35 N/A Community Power Center (Big Box) $ 240.00 $ 480.00 $ 22.30 $ 44.59 N/A
Regional Malls $ 2,500.00 $ 3,000.00 $ 232.26 $ 278.71 N/A Regional Shopping Centers/Malls $ 320.00 $ 1,400.00 $ 29.73 $ 130.06 N/A
Solus Food Stores $ 1,000.00 $ 2,000.00 $ 92.90 $ 185.80 N/A Solus Food Stores $ 400.00 $ 1,000.00 $ 37.16 $ 92.90 N/A
Office in CBD $ 1,000.00 $ 1,800.00 $ 4,046,862.67 $ 7,284,352.81 Office in CBD $ 600.00 $ 1,200.00 $ 2,428,117.60 $ 4,856,235.20
Land in Office Parks $ 300.00 $ 1,200.00 $ 1,214,058.80 $ 4,856,235.20 Land in Office Parks $ 50.00 $ 180.00 $ 202,343.13 $ 728,435.28
Land in Industrial Parks $ 150.00 $ 500.00 $ 607,029.40 $ 2,023,431.33 Land in Industrial Parks $ 30.00 $ 100.00 $ 121,405.88 $ 404,686.27
Office/Industrial Land - Non-park $ 150.00 $ 400.00 $ 607,029.40 $ 1,618,745.07 Office/Industrial Land - Non-park $ 50.00 $ 200.00 $ 202,343.13 $ 809,372.53
Retail/Commercial Land $ 150.00 $ 2,200.00 $ 607,029.40 $ 8,903,097.87 Retail/Commercial Land $ 100.00 $ 500.00 $ 404,686.27 $ 2,023,431.33
Residential $ 300.00 $ 2,300.00 $ 1,214,058.80 $ 9,307,784.14 Residential $ 500.00 $ 1,700.00 $ 2,023,431.33 $ 6,879,666.54

Belgrade, Serbia Johannesburg, South Africa
The economy of Serbia is largely driven by several key sectors: FIFA World Cup 2010 dominated South Africa’s focus from
base metals processing, furniture, food, machinery and the January through June. The majority of spending occurred in
chemical industry. Due to the global financial crisis, the total public sector infrastructure projects prior to 2010 and will
industrial output contracted by 12.1% in 2009, which is mainly have a significant impact on the overall economy. South Africa
due to a 15.8% decrease in the manufacturing sector. continues to be seen as the gateway into Africa, with China
The sector of electricity, gas and water supply remained robust leading the acquisition trail.
as it has generated constant growth during the previous The South African property market remains upbeat despite
eight years. the global recession. It was one of the few markets to
In 2010, the office stock in Belgrade rose to around show positive commercial property returns, 4.6% achieved
575,000 SM of net rentable area, which is a 9% increase to June 2010 (IPD), near the top in world rankings. Improve-
compared to 2009. The existing supply of office space ments in transport and infrastructure, GDP growth of 2.6% to
exceeds the demand, creating vacancy rates of around September 2010 and reduced interest rates, bode well for
30%. The rental level has bottomed out at €13 to the commercial property sector going forward. While capital
€15/SM/month for Class A office space and €10 to growth remained stagnant for retail property, returns showed
€12/SM/month for Class B office space. Rental levels will a 4.1% growth year on year.
remain stable in the next two to three years until vacant Growth in retail sales has been steady, boosted significantly
Contact office space is absorbed. Only a handful of new office plans Contact by the World Cup. Real consumer disposable income
NAI Atrium are under way, creating a supply of 50,000 SM that is slated NAI FINLAY increased by 5.1%, and in June Consumer Confidence surged
+ 381 11 2205880 to enter the market in 2011. + 27 11 807 4724 from 6 points to 15. Consumer Confidence is reportedly the
The economic crisis has heavily affected the Belgrade retail single largest contributing factor to positive economic activity
market, postponing construction of previously announced and consumer spending. Vacancies declined slightly to 4.9%,
while retail rentals have increased on average between 8%
shopping centers. Despite being one of the largest capitals
and 9.5% year over year. Trading densities increased year on
in the region, Belgrade has only two major modern shopping
year by 3.2% at regional shopping centers, outperforming all
centers, Usce and Delta, in the city. The stock of leasable
other shopping center categories, indicating a move away
space in modern shopping centers per capita currently
from the super regionals.
amounts to 100, which is a smaller figure than many
comparable cities in the region, indicating a potential for Due to the strong rand and declining business activity, industrial
Country Data expansion. Rents are still above the regional average for Country Data vacancies experienced their sharpest increase since 2002 to
all types of retailers, but a drop of 10-20% was recorded 6.7%. Capital growth declined year on year at -1.1%
Area (Sq Mi) 341,160 compared to 2009 figures. Area (Sq Mi) 471,445 with income return at 4.9% bringing total return to 3.7% year
on year.
During 2010, a small increase in the supply of quality
GDP Growth 1.5% GDP Growth 3.0% The office market continued its recovery with capital growth
warehouse space was recorded. Despite the announcement
of several large logistic projects, such as Nis Logistic Center, at 1.3% and 6.0% net income growth. Current oversupply
GDP 2010 (US$ B) $38.92 no projects are currently under way. The greatest demand GDP 2010 (US$ B) $354.41 and high vacancies will bring rentals under pressure for at
for modern warehouse space still comes from distribution, least another 12 months.
GDP/Capita (US$) $5,286.00 wholesale, freight forwarding, transportation and pharma- GDP/Capita (US$) $7,100.81 The listed property sector has continued to hold its own
ceutical companies. delivering steady returns. Share prices have increased signif-
Inflation Rate 4.7%
Belgrade’s investment market is still very superficial with Inflation Rate 5.6% icantly and in most instances have well exceeded the values
only a few transactions of modern office space completed. reached prior to the global meltdown. The sector continues
Unemployment 18.2% Unemployment 24.8% to be dominated by mergers and acquisitions as the desire to
Rate Unfortunately, the transacted office buildings are either com- Rate increase market cap continues. Several new listings are
pletely vacant or owned by state companies, so the yield
Interest Rate N/A Interest Rate 6.5% anticipated in 2011 by major institutional and independent
cannot be accurately measured. Based on our experience,
investors. Property Unit Trusts (PUTs) and Property Loan
the current prime office yield in Belgrade is estimated to be
Population (Millions) 7.396 Population (Millions) 49.912 Stocks (PLS) indices returned 9.9% and 10.7%, respectively.
at 9.5%.
Belgrade At A Glance Johannesburg At A Glance

Conversion 0.72 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 6.87 ZAR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) EUR 14.00 EUR 15.00 $ 21.68 $ 23.23 40.00% New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) EUR 12.00 EUR 14.00 $ 18.58 $ 21.68 28.00% Class A (Prime) ZAR 55.00 ZAR 85.00 $ 8.93 $ 13.79 6.60%
Class B (Secondary) EUR 10.00 EUR 12.00 $ 15.48 $ 18.58 23.00% Class B (Secondary) ZAR 22.50 ZAR 65.00 $ 3.65 $ 10.55 26.00%
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) ZAR 175.00 ZAR 175.00 $ 28.40 $ 28.40 N/A
Class A (Prime) N/A N/A N/A N/A N/A Class A (Prime) ZAR 105.00 ZAR 175.00 $ 17.04 $ 28.40 6.40%
Class B (Secondary) EUR 8.00 EUR 10.00 $ 12.39 $ 15.48 N/A Class B (Secondary) ZAR 62.00 ZAR 120.00 $ 10.06 $ 19.47 9.50%
Bulk Warehouse EUR 3.00 EUR 5.50 $ 4.65 $ 8.52 N/A Bulk Warehouse ZAR 25.90 ZAR 25.90 $ 4.20 $ 4.20 6.70%
Manufacturing EUR 2.50 EUR 3.00 $ 3.87 $ 4.65 N/A Manufacturing ZAR 16.40 ZAR 16.40 $ 2.66 $ 2.66 6.70%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D ZAR 26.40 ZAR 26.40 $ 4.28 $ 4.28 6.70%
RETAIL RETAIL
City Center EUR 50.00 EUR 120.00 $ 77.42 $ 185.80 N/A City Center ZAR 80.00 ZAR 300.00 $ 12.98 $ 48.68 7.10%
Neighborhood Service Centers EUR 8.00 EUR 60.00 $ 12.39 $ 92.90 2.50% Neighborhood Service Centers ZAR 150.00 ZAR 220.00 $ 24.34 $ 35.70 4.90%
Community Power Center (Big Box) EUR 6.00 EUR 10.00 $ 9.29 $ 15.48 N/A Community Power Center (Big Box) ZAR 100.00 ZAR 200.00 $ 16.23 $ 32.45 4.90%
Regional Malls EUR 10.00 EUR 70.00 $ 15.48 $ 108.39 N/A Regional Malls ZAR 180.00 ZAR 700.00 $ 29.21 $ 113.59 3.50%
Office in CBD EUR 500.00 EUR 700.00 $ 2,810,321.30 $ 3,934,449.82 Office in CBD ZAR 1,500.00 ZAR 2,000.00 $ 883,594.47 $ 1,178,125.96
Land in Office Parks EUR 250.00 EUR 500.00 $ 1,405,160.65 $ 2,810,321.30 Land in Office Parks ZAR 4,200.00 ZAR 8,300.00 $2,474,064.51 $ 4,889,222.73
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks ZAR 600.00 ZAR 1,600.00 $ 353,437.79 $ 942,500.77
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park ZAR 4,200.00 ZAR 8,300.00 $2,474,064.51 $ 4,889,222.73
Retail/Commercial Land EUR 200.00 EUR 700.00 $ 1,124,128.52 $ 3,934,449.82 Retail/Commercial Land ZAR 650.00 ZAR 650.00 $ 382,890.94 $ 382,890.94
Residential EUR 250.00 EUR 500.00 $ 1,405,160.65 $ 2,810,321.30 Residential ZAR 1,000.00 ZAR 1,500.00 $ 589,062.98 $ 883,594.47

Madrid, Spain Stockholm, Sweden
The real estate sector is undergoing an intense adjustment The economic situation in Sweden has improved and
in Spain. Potential problem loans and receivables in the con- the economic downturn has bottomed with the economy
struction and real estate development sector, which include recovering fairly well. Unemployment does not seem to be
sub-standard loans and foreclosed assets as well as doubtful rising as strongly as previously predicted and economic
assets, are covered by specific provisions at somewhat close activity is increasing. However, there is a risk of a setback
to 30%. The IMF projects GDP growth at 0.75% for Spain in depending on how the global economy continues to develop.
2010. Meanwhile, unemployment edged up to 20.1%. Players in the commercial market include AFA, Alecta, AMF
Office lease transactions have increased almost 30% year Pension, Atrium Ljungberg, Diligentia, Fabege, Hufvud-
over year, reaching 150,000 SM, the highest since 2007, staden, SEB and Vasakronan. Activity in the Stockholm
due to more favorable conditions. Tenants are renegotiating market remains low even though the transaction market is
leases at rates 28% cheaper than the peak and moving to recovering and a clear change in mindset since Q3 2010 is
smaller premises. Availability increased, and is now above evident. The buyers are mainly established players with strong
1.4 million SM, representing almost 13.5% of total stock. financial positions. It has become apparent that foreign
The increase is due in part to second-hand product left investors have begun to show interest in the market again.
vacant by companies. New development remains on hold. Office rents in the city center are now considered to have
Prime office rents in Madrid fell to €28 SM/month. About reached their all time low. The Stockholm property market
Contact 78% of the office transactions were deals of less than 1,000 Contact
has resisted the financial turmoil better than expected.
NAI Sol SM and 55% were below 500 SM. About 35% of the trans- NAI Svefa
However, it should be noted that SOUK-galleria, in the best
+ 34 91 181 1560 actions occurred in the Downtown and 28% in the CBD +46 8 441 15 50
commercial location on Drottninggatan, still stands empty.
zones. Rents continued to fall, especially on secondary New space-efficient office buildings are in greater demand
locations maintaining high vacancy. Prime office yields are than older properties and the CBD is showing signs of shifting
increasing, with stable demand in prime locations, to 7.0%. westwards.
Spain is the third most demanded country for international In recent years there have been major changes around the
retailers. However, the retail market stakeholders (owners, Central Station where, among other developments, the
retailers and consumers) have adapted to new market Waterfront building and Jernhusen's Kungsbrohuset were
conditions, which will continue to attract new retailers completed in 2009. The new complexes contain just over
to Spain. Availability increased by almost 300,000 SM at 40,000 SM of offices and space for restaurants, shops,
Country Data shopping centers, corresponding to new projects, and Country Data
conference halls and a hotel with over 400 rooms. NCC
133.000 SM of Retail Parks. More than 60% of new retail has also built offices in Kungsbron 2, which has an area
Area (Sq Mi) 195,365 projects had a GLA below 40,000 SM. Area (Sq Mi) 173,860
of around 17,500 SM, of which about 92% are office
Total investment volume in the Spanish market could reach properties. Three office properties in Stockholm’s CBD are
GDP Growth -0.4% GDP Growth -4.4%
€1,700 million in 2010. Investors are focusing on core and being converted to hotels and are slated to open in 2011.
opportunistic operations, without renouncing to security, In total, around 20,000 SM of office space will be absorbed
GDP 2010 (US$ B) $1,374.78 GDP 2010 (US$ B) $444.59
especially on tenant’s solvency. Spanish Banks and savings from the CBD.
banks already gathered €1,255 in 2010 (€3,000 million in There is little additional buildable land left in the CBD, but
GDP/Capita (US$) $29,875.09 2009) through sale & leaseback transactions. About 90% GDP/Capita (US$) $47,667.02
some new development could soon become a reality by
of savings banks (“Cajas”) are participating in some type of building over the railway tracks. The planning process
Inflation Rate 1.5% integration process. Interesting opportunities have being Inflation Rate 1.8%
for the North Station area was long and drawn out, but
taken by international and national investors such as REITs the allotment of the land is now under way with the first
Unemployment 19.9% & family offices. For example, Sol Meliá sold a Hotel in Unemployment 8.2%
Rate Rate construction project planned for 2011. Around 3,100 homes
Benidorm for €73.75 million; Deka Immobilien acquired 640 and 300,000 SM of commercial space are being planned
Interest Rate 1.0% Diagonal Avenue in Barcelona for €145 million; Reyal Urbis Interest Rate 0.5%
within the Stockholm city limits.
sold an office building in Madrid for €16.6 million; BBVA
Bank sold its Bilbao headquarters for €364 million to RREEF;
Caja Madrid sold its IT building to SEB Inmoportfolio Fund
for €108 million in a sale/leaseback scheme.
Madrid At A Glance Stockholm At A Glance
Conversion 0.72 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 6.61 SEK = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) EUR 22.00 EUR 28.00 $ 2.84 $ 3.61 5.50% New Construction (AAA) SEK 3,900.00 SEK 4,600.00 $ 54.81 $ 64.65 N/A
Class A (Prime) EUR 15.00 EUR 24.00 $ 1.94 $ 3.10 8.00% Class A (Prime) SEK 2,700.00 SEK 4,100.00 $ 37.95 $ 57.62 N/A
Class B (Secondary) EUR 12.00 EUR 16.00 $ 1.55 $ 2.06 15.00% Class B (Secondary) SEK 1,900.00 SEK 3,000.00 $ 26.70 $ 42.16 N/A
New Construction (AAA) EUR 15.00 EUR 20.00 $ 1.94 $ 2.58 20.00% New Construction SEK 1,700.00 SEK 2,500.00 $ 23.89 $ 35.14 N/A
Class A (Prime) EUR 8.00 EUR 16.00 $ 1.03 $ 2.06 15.00% Class A (Prime) SEK 1,500.00 SEK 2,400.00 $ 21.08 $ 33.73 N/A
Class B (Secondary) EUR 5.00 EUR 9.00 $ 0.65 $ 1.16 20.00% Class B (Secondary) SEK 1,200.00 SEK 1,500.00 $ 16.87 $ 21.08 N/A
Bulk Warehouse EUR 3.50 EUR 5.00 $ 0.45 $ 0.65 N/A Bulk Warehouse SEK 900.00 SEK 1,200.00 $ 12.65 $ 16.87 N/A
Manufacturing EUR 2.75 EUR 4.00 $ 0.35 $ 0.52 N/A Manufacturing SEK 600.00 SEK 950.00 $ 8.43 $ 13.35 N/A
High Tech/R&D EUR 4.50 EUR 5.50 $ 0.58 $ 0.71 N/A High Tech/R&D SEK 800.00 SEK 1,300.00 $ 11.24 $ 18.27 N/A
RETAIL RETAIL
City Center EUR 40.00 EUR 180.00 $ 5.16 $ 23.23 N/A City Center SEK 6,500.00 SEK 16,000.00 $ 91.36 $ 224.88 N/A
Neighborhood Service Centers EUR 8.00 EUR 10.00 $ 1.03 $ 1.29 N/A Neighborhood Service Centers SEK 1,800.00 SEK 2,800.00 $ 25.30 $ 39.35 N/A
Community Power Center (Big Box) EUR 4.00 EUR 7.00 $ 0.52 $ 0.90 N/A Community Power Center (Big Box) SEK 1,200.00 SEK 2,500.00 $ 16.87 $ 35.14 N/A
Regional Malls EUR 6.00 EUR 8.00 $ 0.77 $ 1.03 N/A Regional Shopping Centers/Malls SEK 1,000.00 SEK 4,000.00 $ 14.05 $ 56.22 N/A
Solus Food Stores EUR 8.00 EUR 12.00 $ 1.03 $ 1.55 N/A Solus Food Stores SEK 900.00 SEK 1,800.00 $ 12.65 $ 25.30 N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/ M2 High/M2 Low/Acre High/Acre
Office in CBD EUR 700.00 EUR 1,050.00 $ 3,934,449.82 $ 5,901,674.73 Office in CBD SEK 8,000.00 SEK 15,000.00 $ 4,897,867.07 $ 9,183,500.76
Land in Office Parks EUR 210.00 EUR 630.00 $ 1,180,334.95 $ 3,541,004.84 Land in Office Parks SEK 1,500.00 SEK 2,900.00 $ 918,350.08 $ 1,775,476.81
Land in Industrial Parks EUR 160.00 EUR 430.00 $ 899,302.82 $ 2,416,876.32 Land in Industrial Parks SEK 650.00 SEK 1,300.00 $ 397,951.70 $ 795,903.40
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park SEK 600.00 SEK 1,000.00 $ 367,340.03 $ 612,233.38
Retail/Commercial Land EUR 175.00 EUR 630.00 $ 983,612.45 $ 3,541,004.84 Retail/Commercial Land SEK 1,500.00 SEK 2,500.00 $ 918,350.08 $ 1,530,583.46
Residential EUR 525.00 EUR 2,275.00 $ 2,950,837.36 $12,786,961.91 Residential SEK 2,000.00 SEK 8,000.00 $ 1,224,466.77 $ 4,897,867.07

Geneva, Switzerland Zürich, Switzerland
The Geneva commercial property market has continued to The Greater Zürich Area (GZA) is weathering the economic
remain strong through 2010, primarily due the finance sector. storm, remaining relatively stable despite slow growth during
Inflation remains low at 0.3% year on year. The current 2010. Switzerland has maintained 4th position in the World
national unemployment rate is 3.5%, compared with 4.5% at Competitiveness Report and inflation, although low, is positive
the beginning of the year. This downwards trend is expected at 0.3% (end Q3). Compared to other European cities, unem-
to fall below 3% by the end of 2010. GDP figures for Q3 show ployment is low at around 3.5% and is expected to fall below
a relative increase of 3.4% year on year. 3% by year end. Zurich’s large infrastructure investments are
slowly showing rewards as the new development areas come
The prime office market has performed well, with strong take-
on stream.
up in the CBD and airport areas. Waterfront properties are still
achieving premium rents due to pressures imposed by the An increased level of vacancy has been noted in the
financial sector seeking to acquire prime accommodations. prime area of Bahnhofstrasse, which is suffering from weak
The strong market was also attributed to UK and European demand, with prime rents showing a slight decline since 2009.
tax modifications, provoking new financial occupiers such as Demand for light industrial and warehousing is low, causing
Brevan Howard and BlueCrest Capital Management (European stagnation with pressure due to the Swiss Franc, which
hedge funds) to take up space. A number of major banks have has strengthened over the past 24 months compared with
sought to reposition themselves and consolidate. Prime rents other currencies. Despite this, various owner-occupiers in the
Contact have remained buoyant, with waterfront properties renting Contact outer-Zürich area have been active during 2010, profiting from
NAI Commercial CRE for around CHF 1,000-1,200/SF per year and higher if NAI Commercial CRE the economy to seek better real estate solutions.
+ 41 22 707 44 44 exceptional properties. +41 44 221 04 04 Although foreign investment interest remains strong, the
The take-up in the light industrial and warehousing market major Swiss funds and insurance companies have rapidly
has been subdued. Rockspring’s development alone placed absorbed the available properties. The volume of sales still
remains low; however, prime yields have softened slightly
11,000 SM of space on the market. Various owner-occupiers
with net yields transacting at rates between 4-4.75% for
or long-lease holders such as IKEA and Rolex have sought to
prime properties depending on the quality of building and
take advantage of the market.
tenant mix.
The Lake Geneva region high-tech office developments are
To the outskirts of Zürich, Zug has seen a degree of regen-
emerging well with solid uptake, mainly due to tax incentives. eration due to the opening of the long awaited motorway
Country Data Rents remain at CHF 120-150/SM per year for production areas Country Data ring enhancing access to between Zürich and Zug. Zug’s
and CHF 200-360/SM per year for high-tech office space. influence in attracting multinationals and financial compa-
Area (Sq Mi) 15,940 The investment market for landmark buildings has remained Area (Sq Mi) 15,940 nies has strengthened and the new office developments are
stable though the volume of sales has decreased due to a lack seeing strong interest with an important number of pre-lets.
GDP Growth 2.9% of willing vendors. Net yields in the prime areas still remain GDP Growth 2.9% The main retail High Street, Bahnhofstrasse, has not escaped
hard though the euphoria of 2009 has somewhat abated, with the sluggish economy but has seen newcomers like Hugo
GDP 2010 (US$ B) $522.43
prime yields achieving between 3.75-4.0%. GDP 2010 (US$ B) $522.44 Boss, Jimmy Choo, Body Shop and a new outlet of Bernie’s
The retail market has suffered over the past 12 months with come on the market. Rents are in the order of CHF 3,500 to
GDP/Capita (US$) $67,074.31 an increased turnover of units. Primary tenants locating to the GDP/Capita (US$) $67,074.31 3,800/SM per year, though some deals have resulted in trans-
High Street or to improved locations have included more actions substantially in excess of those figures.
Inflation Rate 0.7% movement in the luxury brands, for example, Versace. Inflation Rate 0.7% Numerous office projects in Zürich West and Oerlikon (esti-
The Geneva market is still outpacing Zürich. Although uncom- mated at some 130,000 SM in total) have progressed despite
Unemployment 0.4% mon, this trend is likely to continue as corporations seek to Unemployment 3.5% the predicted downturn and are due to come on line in 2011
Rate Rate and 2012, producing a surplus of accommodation on the
relocate to Geneva. The forward trend for Geneva appears
Interest Rate 0.3% good, similarly for the Lake Geneva Region. Another phenom- Interest Rate 0.3% market. Although some 50% of the new projects have been
enon that has benefited Switzerland, and Geneva in particular, pre-let, it is the properties that are being vacated which will
Population (Millions) 7.789 is the general world economic situation where the economic Population (Millions) 7.789 cause vacancy levels to swell. Over the next 12 months Zürich
stability of Switzerland has always increased its attractiveness is likely to suffer from an over-supply in the market.
in uncertain times.
Geneva At A Glance Zürich At A Glance
Conversion 0.96 CHF = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion 0.96 CHF = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) CHF 900.00 CHF 1,200.00 $ 87.10 $ 116.13 1.00% New Construction (AAA) CHF 800.00 CHF 950.00 $ 77.42 $ 91.93 N/A
Class A (Prime) CHF 850.00 CHF 1,100.00 $ 82.26 $ 106.45 1.50% Class A (Prime) CHF 700.00 CHF 850.00 $ 67.74 $ 82.26 N/A
Class B (Secondary) CHF 600.00 CHF 800.00 $ 58.06 $ 77.42 5.00% Class B (Secondary) CHF 450.00 CHF 600.00 $ 43.55 $ 58.06 N/A
New Construction (AAA) CHF 450.00 CHF 600.00 $ 43.55 $ 58.06 2.50% New Construction (AAA) CHF 400.00 CHF 500.00 $ 38.71 $ 48.39 N/A
Class A (Prime) CHF 450.00 CHF 550.00 $ 43.55 $ 53.23 3.50% Class A (Prime) CHF 300.00 CHF 450.00 $ 29.03 $ 43.55 N/A
Class B (Secondary) CHF 300.00 CHF 450.00 $ 29.03 $ 43.55 5.00% Class B (Secondary) CHF 300.00 CHF 450.00 $ 29.03 $ 43.55 N/A
Bulk Warehouse CHF 70.00 CHF 90.00 $ 6.77 $ 8.71 1.00% Bulk Warehouse CHF 70.00 CHF 90.00 $ 6.77 $ 8.71 N/A
Manufacturing CHF 90.00 CHF 150.00 $ 8.71 $ 14.52 1.00% Manufacturing CHF 80.00 CHF 150.00 $ 7.74 $ 14.52 N/A
High Tech/R&D CHF 250.00 CHF 360.00 $ 24.19 $ 34.84 2.00% High Tech/R&D CHF 200.00 CHF 350.00 $ 19.35 $ 33.87 N/A
RETAIL RETAIL
City Center CHF 3,250.00 CHF 4,500.00 $ 314.51 $ 435.48 1.00% City Center CHF 3,500.00 CHF 5,000.00 $ 338.71 $ 483.87 N/A
Neighborhood Service Centers CHF 450.00 CHF 500.00 $ 43.55 $ 48.39 4.00% Neighborhood Service Centers CHF 450.00 CHF 500.00 $ 43.55 $ 48.39 N/A
Community Power Center (Big Box) N/A N/A N/A N/A N/A Community Power Center (Big Box) N/A N/A N/A N/A N/A
Regional Shopping Centers/Malls CHF 350.00 CHF 600.00 $ 33.87 $ 58.06 1.50% Regional Shopping Centers/Malls CHF 450.00 CHF 800.00 $ 43.55 $ 77.42 N/A
Office in CBD CHF 30,000.00 CHF 40,000.00 $ 126,464,458.43 $ 168,619,277.90 Office in CBD CHF 30,000.00 CHF 40,000.00 $ 126,464,458.43 $ 168,619,277.90
Land in Office Parks CHF 700.00 CHF 1,000.00 $ 2,950,837.36 $ 4,215,481.95 Land in Office Parks CHF 700.00 CHF 900.00 $ 2,950,837.36 $ 3,793,933.75
Land in Industrial Parks CHF 200.00 CHF 300.00 $ 843,096.39 $ 1,264,644.58 Land in Industrial Parks CHF 200.00 CHF 300.00 $ 843,096.39 $ 1,264,644.58
Office/Industrial Land - Non-park CHF 250.00 CHF 400.00 $ 1,053,870.49 $ 1,686,192.78 Office/Industrial Land - Non-park CHF 250.00 CHF 400.00 $ 1,053,870.49 $ 1,686,192.78
Retail/Commercial Land CHF 1,000.00 CHF 1,500.00 $ 4,215,481.95 $ 6,323,222.92 Retail/Commercial Land CHF 1,000.00 CHF 1,500.00 $ 4,215,481.95 $ 6,323,222.92

Istanbul, Turkey Kiev, Ukraine
On the heals of positive economic figures that included GDP 2010 was characterized as a period of stabilization for
growth approaching 6% in Q4 2009, 2010 has continued Ukraine’s economy. By the end of 2010 the ROE is expected
the favorable trend. According to IMF estimates, Turkey will to be the lowest in two years. These trends allowed the
achieve GDP growth of 3.7% in 2010 compared with the National Bank of Ukraine to decrease its BLR from 10.25%
CEE average of 1.8%. The consumer confidence index to 7.75%. Also the Hryvna stabilized against the U.S. dollar.
increased 10% points in 2010 reaching a level of 82% in The construction industry continued its decline but the rate
February 2010. dropped from 54.8% in 2009 to 19.3% in 2010. Industrial
Total modern office stock in Istanbul is 1.67 Million SM. The production improved by 12%.
supply of prime office space in the CBD is limited and the Despite an increase in occupier demand, the Kiev office
vacancy rate is rapidly decreasing. Therefore, rents continue market is a tenant’s market. In October 2010, prime rents
to rise. Umraniye has become the most popular district on were about $28-$35/SM per month excluding operating
the Asian side for office development. The affordable rental expenses, with vacancy at 15 %. Prime rents and vacancy
rates compared to the European side and availability of rates will remain at the same level to year end. In 2010,
suitable properties for construction make Umraniye more 106,000 SM of office space were added to the stock, which
attractive. The largest completions in the office market includes such business centers as RELE (2nd line), Megacity,
included the Eczacibasi office project in Levent, and Doruk Vertical and Premium Center.
Contact Plaza with 13,305 SM of GLA in Umraniye. Both projects Contact
In 3Q 2010, prime rents for modern warehouses within 30
NAI Treas delivered in Q1 2010. NAI Pickard
kilometers of Kiev were $5.50 to $6.50 SM per month
+90 216 481 47 00 +380 44 278 00 02
The retail market indicators have become more positive in excluding operating expenses. Vacancy rates were 25%.
2010. The total inventory of leasable area has reached 2.28 Only 100,000 SM of modern warehouse facilities were
million SM, with 77 shopping centers in Istanbul. The delivered to the market in 2010. Among the major trans-
average rental rates in shopping centers range from $30 to actions in this sector was the sale by ProLogis of a logistic
$65/SM per month, although the rental rates in the main complex and land for a logistic center of 170, 000 SM to
districts are between $47.50 to $150/SM per month. In Q1 Raben Group.
2010, two shopping centers opened in Turkey with a total The occupancy rate for shopping centers has increased with
of 82,000 SM GLA. only 2% of the total retail space remaining vacant. The
Country Data The industrial market was most affected by the global Country Data average rental rates are $45-$50/SM per month. Growth of
economic crisis. The rapid regression during the second and retail space in shopping centers in the first half of 2010 was
the third quarters of 2009 has now stabilized and new Area (Sq Mi)
1.9% (11,700 SM). The largest commercial developer,
Area (Sq Mi) 302,535 233,000
investment was initiated in Q4 2009 with 1.4 million SM of Panorama Group, sold a 50% share in its flagship Kyiv Sky
new construction licenses. Ekol Logistics has built a Mall project to the Oledo Group. Several new shopping center
GDP Growth 3.7 % GDP Growth 4.0 %
100,000 SM warehouse project in Gebze. Major acquisitions projects were initiated, including Ocean Plaza on Gorkogo
include a 50,000 SM logistics investment by DHL. St. Kyiv (to be commissioned in 2012) and Lubava in the
GDP 2010 (US$ B) $616,75 GDP 2010 (US$ B) $140.90
After the recession in the Turkish real estate market, new center of Cherkassy (to be commissioned in August 2011).
investment transactions were realized in 2010 and this trend GDP/Capita (US$) $3,075.00
There was little change in the market throughout 2010. FDI
GDP/Capita (US$) $ 8,578
is likely to continue. The yield trends for the office and the remains almost at zero. Even the promise of no government
retail markets are expected to be stable this into 2011. tax on hotels completed by 2012 has done relatively little
to stimulate the market. It is predicted that the worst is
Unemployment
over and the market has settled into a stable period.
Unemployment 11.4% 8.8 %
Rate Rate However, for those investors with cash to invest, returns can
be quite promising at 25% to 35% or more per year with
the possibility of substantial capital growth.
Population (Millions) 72,561,312 Population (Millions) 45.8
Istanbul At A Glance Kiev At A Glance

RENT/M2/YR US$ RENT/SF/YR Conversion 8.05 UAH = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) $ 240.00 $ 589.00 $ 22.30 $ 54.72 N/A New Construction N/A N/A N/A N/A N/A
Class A (Prime) $ 300.00 $ 432.00 $ 27.87 $ 40.13 9.70% Class A (Prime) UAH 220.00 UAH 280.00 $ 30.47 $ 38.78 15.00%
Class B (Secondary) $ 243.00 $ 262.00 $ 22.58 $ 24.34 9.10% Class B (Secondary) UAH 160.00 UAH 200.00 $ 22.16 $ 27.70 12.00%
New Construction (AAA) $ 189.00 $ 226.00 $ 17.56 $ 21.00 N/A New Construction N/A N/A N/A N/A N/A
Class A (Prime) $ 183.00 $ 169.00 $ 17.00 $ 15.70 N/A Class A (Prime) UAH 96.00 UAH 160.00 $ 13.29 $ 22.16 20.00%
Class B (Secondary) $ 121.00 $ 227.00 $ 11.24 $ 21.09 N/A Class B (Secondary) UAH 40.00 UAH 120.00 $ 5.54 $ 16.62 20.00%
Bulk Warehouse $ 54.00 $ 66.00 $ 5.02 $ 6.13 N/A Bulk Warehouse UAH 43.50 UAH 51.40 $ 6.02 $ 7.12 25.00%
Manufacturing $ 40.00 $ 56.00 $ 3.72 $ 5.20 N/A Manufacturing UAH 40.00 UAH 48.00 $ 5.54 $ 6.65 20.00%
High Tech/R&D $ 64.00 $ 68.00 $ 5.95 $ 6.32 N/A High Tech/R&D UAH 64.00 UAH 80.00 $ 8.86 $ 11.08 30.00%
RETAIL RETAIL
City Center $ 570.00 $ 1,800.00 $ 52.95 $ 167.22 N/A City Center UAH 528.00 UAH 1,128.00 $ 73.12 $ 156.21 1.00%
Neighborhood Service Centers $ 306.00 $ 890.00 $ 28.43 $ 82.68 N/A Neighborhood Service Centers UAH 115.00 UAH 321.00 $ 15.93 $ 44.45 3.00%
Community Power Center (Big Box) $ 250.00 $ 668.00 $ 23.23 $ 62.06 N/A Community Power Center (Big Box) UAH 115.00 UAH 330.00 $ 15.93 $ 45.70 3.00%
Regional Shopping Centers/Malls $ 360.00 $ 780.00 $ 33.44 $ 72.46 N/A Regional Shopping Centers/Malls UAH 336.00 UAH 600.00 $ 46.53 $ 83.09 1.00%
Solus Food Stores $ 188.00 $ 278.00 $ 17.47 $ 25.83 N/A Solus Food Stores UAH 80.00 UAH 120.00 $ 11.08 $ 16.62 N/A
Office in CBD $ 850.00 $ 4,015.00 $ 3,439,833.27 $ 16,248,153.62 Office in CBD UAH 10,000.00 UAH 40,000.00 $ 5,027,158.60 $ 20,108,634.38
Land in Office Parks N/A N/A N/A N/A Land in Office Parks UAH 400.00 UAH 1,200.00 $ 201,086.34 $ 603,259.03
Land in Industrial Parks $ 265.00 $ 650.00 $ 1,072,418.61 $ 2,630,460.74 Land in Industrial Parks UAH 80.00 UAH 240.00 $ 40,217.27 $ 120,651.81
Office/Industrial Land - Non-park $ 375.00 $ 1,600.00 $ 1,517,573.50 $ 6,474,980.27 Office/Industrial Land - Non-park UAH 40.00 UAH 160.00 $ 20,108.63 $ 80,434.54
Retail/Commercial Land $ 560.00 $ 4,200.00 $ 2,266,243.10 $ 16,996,823.21 Retail/Commercial Land UAH 4,000.00 UAH 12,000.00 $ 2,010,863.44 $ 6,032,590.32
Residential $ 70.00 $ 2,000.00 $ 283,280.39 $ 8,093,725.34 Residential UAH 800.00 UAH 3,200.00 $ 402,172.69 $ 1,608,690.75

London, United Kingdom
The UK elected a new government in May 2010, the Con-
servative/Liberal Democrat coalition--the first coalition
government for many years. The new government has
recently announced drastic austerity measures that are
expected to cause 330,000 job losses in the public sector.
VAT is to increase in January 2011 from 17.5% to 20%. Whilst
the measures are necessary to address the budget deficit,
there is some concern that they could push the economy back
into recession.

In the office market, supply remains key as most demand
is from tenants seeking to upgrade from their existing
accommodation and to benefit from current market condi-
tions. This has led to a marked difference between the
markets for Class A and secondary space in the City and

West End. There is a general shortage of Class A space in
floors of over 10,000 SF leading to demand for develop-
Contact ments to be delivered between 2012 and 2014. Constraints

NAI Global on funding for such developments continue to restrict the mar-
+1 609 945 4000 ket leading to higher rental growth forecasts.
Industrial space availability rose throughout 2010. There
was also an increase in speculative development with one
small scheme started in Greater London and further devel-

opments expected to start in 2011. The level of enquiries
for space has increased steadily. Substantial incentives
remain the norm, but as supply becomes more restricted

these incentives will fall away.
Country Data The central London retail market, with significantly lower
vacancy rates, continues to outperform the rest of the country.
Area (KM2) 93,800
London always benefits from the increased demand from
tourists and the weaker pound has boosted this. Record rental

levels, triggered by strong demand from foreign retailers and
GDP Growth 1.7%
low vacancy, are being achieved in the prime locations such
as Regent Street, Oxford Street and New Bond Street. Concern
GDP 2008 (US$ B) 2,258.57

remains related to the increase in VAT in January 2011 and
the planned job cuts in the public sector.
GDP/Capita (US$) 36,298.39
In the investment market there is a divergence between
central London and the rest of the country. UK yields have
Inflation Rate 3.8%
been hardening since late 2009 and, whilst most markets saw

yields stabilizing in Q2, yield compression has continued in the
Unemployment 3.1%
prime West End market reflecting the resumption of rental
Rate
growth. The market remains somewhat fragile, however,

with concerns relating to the government spending cuts and
Interest Rate 0.5%
the unresolved debt/financing issues. London remains one
of the most attractive cities in the world for foreign investors
Population (Millions) 7.876 who have fuelled much of the recent activity.
London At A Glance
Conversion 0.62 GBP = 1 US$ RENT/SF/YR
Low High
RENT/SF/YR
Low High Vacancy

OFFICE WEST END
Mayfair N/A GBP 85.00 N/A $ 137.10 6.50%
Victoria N/A GBP 52.50 N/A $ 84.68 N/A
Midtown N/A GBP 45.00 N/A $ 72.58 6.50%
OFFICE CITY
Core N/A GBP 52.50 N/A $ 84.68 7.50%
Fringe N/A GBP 40.00 N/A $ 64.52 N/A
Docklands N/A GBP 37.50 N/A $ 60.48 8.00%
INDUSTRIAL SPACE
Greater London GBP 7.25 GBP 10.00 $ 11.69 $ 16.13 N/A
West London GBP 11.00 GBP 14.00 $ 17.74 $ 22.58 N/A
RETAIL SPACE (ZONE A)
Oxford Street (Zone A) N/A GBP 720.00 N/A $ 1,161.29 N/A
Bond Street (Zone A) N/A GBP 925.00 N/A $ 1,491.94 N/A
Sloane Street (Zone A) N/A GBP 550.00 N/A $ 887.10 N/A
City (Zone A) N/A GBP 220.00 N/A $ 354.84 N/A
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD N/A N/A N/A N/A
Land in Industrial Parks GBP 275,000.00 GBP 1,250,000.00 $ 443,548.39 $ 2,016,129.03
Retail/Commercial Land N/A N/A N/A N/A
Residential N/A N/A N/A N/A

Latin America
SECTION CONTENTS
Buenos Aires, Argentina
Nassau, Bahamas
Campinas, Brazil
Curitiba, Brazil
Porto Alegre, Brazil
Rio de Janeiro, Brazil
Sao Paulo, Brazil
Santiago, Chile
Bogotá, Colombia
San Jose, Costa Rica
Kingston, Jamaica
Ciudad Juarez, Chihuahua, Mexico
Guadalajara, Jalisco, Mexico
Guanajuato, Mexico
Matamoros, Tamaulipas, Mexico
Mexicali, Baja California, Mexico
Mexico City, Mexico
Monterrey, Nuevo Leon, Mexico
Querétaro, Mexico
Reynosa, Tampaulipas, Mexico
Saltillo, Coahuila, Mexico
San Luis Potosí (SLP), Mexico
Tijuana, Baja California, Mexico
Torreon, Coahuila, Mexico
Panama City, Republic of Panama
Caracas, Venezuela
Buenos Aires, Argentina Nassau, The Bahamas
The Argentine economy is expected to realize a 7% growth The Bahamas is an archipelago just off the coast of Florida;
in 2010 as the agricultural and commodities sectors with its strategic location it has always been a great location
benefit from higher global prices and loose fiscal policies for tourists. With over 700 islands, the Bahamas has a lot
continue to push consumer demand. The economy is of diverse areas to discover. The driving force behind the
expected to continue expanding throughout 2011 at a Bahamian economy has always been tourism and not far
rate of 5% based on Argentina’s competitive advantages behind is offshore banking.
in sectors like agribusiness, back-office services and With tourism being the number one driver of the economy
specialized manufacturing. the government in recent years has really made a push to
Overall, the commercial real estate market was flat in 2010 make the Bahamas a truly world-class destination. In
with lower demand causing vacancies to increase to over the fall of 2009 the Government of the Bahamas started
10% and prices to soften 10-25%. Lower demand in the dredging the main harbor, allowing the new “super-sized
office market caused lease prices to fall 10-15% in Class A cruise ships,” which have tripled the amount of guests that
office space in the Buenos Aires CBD to an average of they can hold, to dock. This project was completed in the
$28-$32/SM/month with vacancy jumping from 5% to 12%. beginning of 2010 and with that done the first ship to arrive
Class B space and suburban offices have seen values remain was Royal Caribbean’s Oasis of the Seas, with about 6,000
flat in 2010 with transactions being completed in the guests on board and about 2,000 staff.
Contact $15-$20/SM/month range as companies emphasized cost Contact
The Baha Mar cable beach redevelopment project has now
NAI Castro Cranwell savings. SAP, for example, took 8,000 SM in a suburban NAI Lowes Realty
partnered with the Chinese Banking and Construction
& Weiss S.A. Class A building paying approximately $17/SM. Philip +1 242 393 6225
Partners in order to develop a multi-hotel golf beachfront
+1 54 11 4320 4320 Morris and Direct TV moved to suburban office buildings community. Baha Mar has partnered with Hyatt Hotels to do
for approximately $18/SM. the Convention and timeshare hotel, Morgan’s Hotel Group
Premium industrial parks and logistics facilities maintained to manage the Lifestyles hotel, and Rosewood Hotels and
their values and the vacancy level is still in the low single Resorts to manage the Luxury Hotel. This will bring the Cable
digits. This segment in Argentina continues to be underser- Beach area back to the forefront and compete with the
viced and demand is continuing to increase with the overall Atlantis resort.
economy. In the other market segments, warehouse space The office sector is still sluggish with not much movement.
vacancy increased slightly and values have become There has been no major construction of office structures
Country Data marginally softer. Country Data
or new groups looking to develop in this area. The retail
Area (Sq Mi) 1,073,500
Top retail lease values remained flat during 2010 both in market in the downtown core is still hurting. With the new
Area (Sq Mi) 5,383
High Street properties and shopping centers. Nevertheless, super-sized cruise ships that are now entering the port,
GDP Growth 7.5%
the retail market continues to be under serviced as is hopefully this will increase the tourist traffic on Bay St. There
evident by the inauguration of new shopping centers and GDP Growth 0.5% is a new large strip mall being constructed on the western
GDP 2010 (US$ B) $351.02 full occupancy in high-end sectors. end of the island in order to serve the growing population in
GDP 2010 (US$ B) $7.54 the area. It will be anchored with a bank and a Solomon’s
Cap rates also remained flat in 2010 and are generally in
the 10-14% range, although there continues to be a lack Wholesale Natural Food Store.
of sellers, particularly of premium properties. Although the The industrial and “out of town” areas are still growing. With
Inflation Rate 10.6%
Argentine economy presents an above average risk profile the need for space and reasonably priced land the Airport
due to its political uncertainties, the internal market has Inflation Rate 1.7% Industrial Park is flourishing. The Lynden Pindling Interna-
Unemployment 8.0% posted significant year-on-year increases. Investors are tional Airport U.S. departure terminal is nearing completion,
Rate Unemployment 15%
finding numerous attractive opportunities in build-to-suit which will be a much anticipated improvement.
Rate
warehouses, hotel and tourism projects (especially in
Interest Rate 9.9% the premium market) and with the conversion of rural and
agricultural property. Class B vacancy has now increased Interest Rate 5.5%
Population (Millions) 40.519 and new low-cost alternatives are more available.
Buenos Aires At A Glance Nassau At A Glance

RENT/M2/Mo US$ RENT/SF/YR RENT/SF/YR US$ RENT/SF/YR
New Construction (AAA) $ 28.00 $ 35.00 $ 31.22 $ 39.02 0.50% New Construction (AAA) N/A N/A N/A N/A N/A
New Construction (AAA) $ 18.00 $ 22.00 $ 20.07 $ 24.53 2.00% New Construction (AAA) N/A N/A N/A N/A N/A
Bulk Warehouse $ 3.50 $ 7.00 $ 3.90 $ 7.80 N/A Bulk Warehouse $ 10.00 $ 20.00 $ 10.00 $ 20.00 N/A
Manufacturing $ 3.50 $ 5.50 $ 3.90 $ 6.13 N/A Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D $ 5.00 $ 8.00 $ 5.57 $ 8.92 N/A High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 35.00 $ 100.00 $ 39.02 $ 111.48 5.00% Downtown $ 45.00 $ 95.00 $ 45.00 $ 95.00 N/A
Neighborhood Service Centers $ 15.00 $ 20.00 $ 16.72 $ 22.30 15.00% Neighborhood Service Centers N/A N/A N/A N/A N/A
Community Power Center N/A N/A N/A N/A N/A Community Power Center $ 35.00 $ 100.00 $ 35.00 $ 100.00 N/A
Regional Malls $ 18.00 $ 70.00 $ 20.07 $ 78.04 10.00% Regional Malls $ 15.00 $ 25.00 $ 15.00 $ 25.00 N/A
Solus Food Storesl N/A N/A N/A N/A N/A Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/Acre High/Acre
Office in CBD $ 500.00 $ 1,200.00 $ 2,023,431.33 $ 4,856,235.20 Office in CBD N/A N/A
Land in Office Parks N/A N/A N/A N/A Land in Office Parks N/A N/A
Land in Industrial Parks $ 30.00 $ 80.00 $ 121,405.88 $ 323,749.01 Land in Industrial Parks $ 10.00 $ 15.00
Office/Industrial Land - Non-park $ 40.00 $ 80.00 $ 161,874.51 $ 323,749.01 Office/Industrial Land - Non-park N/A N/A
Retail/Commercial Land $ 200.00 $ 1,000.00 $ 809,372.53 $ 4,046,862.67 Retail/Commercial Land $ 15.00 $ 18.00
Residential $ 400.00 $ 1,500.00 $ 1,618,745.07 $ 6,070,294.00 Residential $ 10.00 $ 15.00

Campinas, Brazil Curitiba, Brazil
Campinas is located in the state of São Paulo, 90 kilometers Curitiba is the capital of the state of Parana, located in
from the capital. The city occupies an area of 796 square southern Brazil. The city has 435 square kilometers of total
kilometers and has a population of 1,083,642 inhabitants. area and has about 2 million inhabitants. For many, this is
The city is the headquarters of the Metropolitan Region of considered to be the city with the best quality of life in Brazil.
Campinas (MRC), consisting of 19 municipalities. The MRC The city has imposed several urban plans and laws that led
has been conquering and consolidating, an important to it becoming internationally known for its innovations and
economic national position in recent years. care with regard to the urban environment.
The region has a diversified modern industrial park with Curitiba is one of the best cities for investors in all of Latin
international companies such as Honda, Toyota, Unilever, America. It is headquarters for important companies in the
3M, Bosch, Dell, IBM, BASF, Dow Química, Goodyear, Valeo, trade sectors and financial services. Curitiba has attracted
Nortel, Lucent, Samsung, AmBev, Bombardier, DuPont and companies such as Exxon Mobil, Sadia, Kraft Foods,
Shell. MRC's GDP is US $17.5 billion. Siemens, Johnson Controls and HSBC. The city has an
The region has an extensive road system with the main axis important and diversified group of industries including
in Anhanguera and Bandeirantes. Viracopos airport, located the second largest automotive hub in the country and the
in Campinas, is one of the busiest in the country. There is a International Airport Afonso Pena, a major international
project to create an industrial airport in Viracopos that aviation terminal in the southern region.
Contact Contact
is capable of increasing Brazilian exports by importing Due to the good economic times, the real estate market is
NAI Commercial NAI Commercial
components to be manufactured in plants located within the growing in Curitiba. In the residential sector, each region is
Properties Brazil Properties Brazil
airport. As a part of the Brazilian government's strategy experiencing a different pace of growing. Property values in
+1 55 11 5506 5655 +1 55 11 5506 5655
to accelerate economic growth it looks to develop a quality the district Juvevê have increased 65% in the last six years.
rail service for passengers based on the deployment of a Other districts with solid performance are Portão, CIC, Sítio
high-speed railway axis with Rio de Janeiro, São Paulo and Cercado and Pinheirinho. Santa Candida and Barreirinha
Campinas to complement the transport road and air service. also deserve mention.
Rio de Janeiro, São Paulo and Campinas comprise 33% of The Neoville is an area of 1 million SM located in the industrial
the national GDP and 20% of the population of the country. region of Curitiba (CIC) and one of the few available land
In this scenario, the city of Campinas and surrounding parcels for new ventures. The zoning allows for the construc-
region, which is already a superior area, should soon tion of various residential buildings. There is also an industrial
Country Data become a large logistics center. Country Data
area facing the businesses and condominiums, commercial
The industrial production trend in Brazil requires the instal- space, construction of several schools, supermarkets and
Area (Sq Mi) 3,287,612 Area (Sq Mi) 3,287,612
lation of industrial condos and logistics centers that allow shopping malls.
the flow of production and are located in sites close to The city's industrial sector remained stable and is one of
consumer centers that are both economically and logistically the most sought after for investment. The yield is unlikely to
sound. In Campinas, a large number of these condominiums be less than 1% per month. The rising price of land values
GDP 2010 (US$ B) $2,023.53 have already been established with more scheduled to come GDP 2010 (US$ B) $2,023.53
in recent years is a decisive factor for the increase of the
on the market in the coming months. property value. Land has become increasingly scarce in the
GDP/Capita (USD) $10,470.90 GDP/Capita (USD) $10,470.90
Following the housing boom of recent years, the high best districts and has consequently raised the prices of the
standard residential condos with airstrip and 18 hole golf available properties.
course has been much sought after by investors. It is a small Brazil is in the process of a presidential election. However,
but very profitable market. The main projects are located 120 regardless of who wins, it is believed that the unprecedented
Unemployment 7.2% kilometers from São Paulo, mainly in the region of Campinas. Unemployment 7.2%
Rate Rate economic situation remains bright. In addition, the FIFA
The unprecedented economic situation continues to have World Cup in 2014 and the 2016 Olympic Games will take
Interest Rate 10.8%
an effect on the area but is looking up. From Q1 to Q2 2010 Interest Rate 10.8%
place in Brazil and are expected to attract additional invest-
the volume of commercial real estate transactions in the ments that will further support the economic stability of
Brazilian market has almost tripled, jumping from US $577 Population (Millions) 193.253
the country.
million to about US $1.6 billion.
Campinas At A Glance Curitiba At A Glance
Conversion 1.68 BRL = 1 US$ RENT/M2/MO US$ NET RENT/SF/YR Conversion 1.68 BRL = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) BRL 45.00 BRL 50.00 $ 29.86 $ 33.18 5.50% New Construction (AAA) BRL 45.00 BRL 50.00 $ 29.86 $ 33.18 5.00%
Class A (Prime) BRL 35.00 BRL 40.00 $ 23.23 $ 26.54 6.00% Class A (Prime) BRL 35.00 BRL 40.00 $ 23.23 $ 26.54 5.00%
Class B (Secondary) BRL 25.00 BRL 30.00 $ 16.59 $ 19.91 6.00% Class B (Secondary) BRL 25.00 BRL 30.00 $ 16.59 $ 19.91 5.50%
Bulk Warehouse BRL 10.00 BRL 25.00 $ 6.64 $ 16.59 5.00% Bulk Warehouse BRL 10.00 BRL 25.00 $ 6.64 $ 16.59 5.00%
Manufacturing BRL 10.00 BRL 25.00 $ 6.64 $ 16.59 5.00% Manufacturing BRL 10.00 BRL 25.00 $ 6.64 $ 16.59 4.50%
High Tech/R&D BRL 10.00 BRL 25.00 $ 6.64 $ 16.59 5.00% High Tech/R&D BRL 10.00 BRL 25.00 $ 6.64 $ 16.59 4.50%
RETAIL RETAIL
Downtown BRL 50.00 BRL 70.00 $ 33.18 $ 46.45 5.50% Downtown BRL 50.00 BRL 70.00 $ 33.18 $ 46.45 5.00%
Neighborhood Service Centers BRL 40.00 BRL 60.00 $ 26.54 $ 39.82 5.00% Neighborhood Service Centers BRL 40.00 BRL 60.00 $ 26.54 $ 39.82 5.00%
Community Power Center BRL 20.00 BRL 30.00 $ 13.27 $ 19.91 5.00% Community Power Center BRL 20.00 BRL 30.00 $ 13.27 $ 19.91 4.50%
Regional Malls BRL 20.00 BRL 30.00 $ 13.27 $ 19.91 4.60% Regional Malls BRL 20.00 BRL 30.00 $ 13.27 $ 19.91 4.50%
Solus Food Stores BRL 20.00 BRL 30.00 $ 13.27 $ 19.91 4.50% N/A N/A N/A N/A N/A
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks N/A N/A N/A N/A

Porto Alegre, Brazil Rio de Janeiro, Brazil
Porto Alegre is the capital of Rio Grande do Sul. It is located The city of Rio de Janeiro, located in southeastern Brazil, has
in the extreme southern region of Brazil and is comprised an area of 1,182 SM with 6,093,472 inhabitants and
of 497 square kilometers. With a population of almost 1.5 accounts for Brazil's second largest economy. Its industrial
million inhabitants, it has the highest income per capita and park is comprised of metal industries, steel, chemicals, food
is the fourth most populous city in the country. Porto Alegre processing, mechanical, editorial and cellulose. Tourism is
is strategically well located in relation to the other countries the city's main activity with Rio de Janeiro being the choice
of Mercosul (the union between Argentina, Brazil, Paraguay location for 40% of all foreigners who visit Brazil. The tertiary
and Uruguay). sector accounts for essential services and oil production
The city’s economy is based largely on the service industry The city of Rio de Janeiro is home to the headquarters of
followed by the industrial and farm sectors. The production such companies as Shell, ESSO, Ipiranga, El Paso, Repsol
of fruits and vegetables is also a significant market resulting YEP, Chevron Texaco and more. The city has a limited amount
in the city possessing the largest rural zone between the of quality areas for new developments and the demand
Brazilian capitals. remains quite high. The central region is where most of the
The city of Porto Alegre, as is the case with the entire country, offices are located due to the transportation infrastructure
is experiencing solid fundamentals in the real estate market. and high population density. The very low vacancy has
However, according to experts, the market must content with maintained the rental values at very high levels, keeping the
Contact Contact city as one of the worlds most expensive in the sector.
three significant challenges: lack of land, lack of manpower
NAI Commercial NAI Commercial
and the growing cost of raw materials, primarily cement and The Ventura Corporate Towers, the largest and most modern
Properties Brazil Properties Brazil
steel. office development in downtown Rio de Janeiro, had two
+1 55 11 5506 5655 +1 55 11 5506 5655
Due to the warming in the market, residential buildings in towers with 106,000 SM of leasable space delivered to the
the lower socioeconomic classes are fully sold within 24 market over a period of time but the property is already fully
hours after their release. In 2010 alone, the construction leased. The Ventura has inaugurated a new age in Rio de
industry employed about 400,000 workers throughout Janeiro, becoming the first green project (LEED®- certified Gold)
the country. The federal government's "My House My Life" in the city.
program has driven significant investment in the residential The retail market in Rio de Janeiro city is heated, with a
sector for the lower socioeconomic class and facilitated the strong presence of companies in the city and many tourist
Country Data financing for those properties. Country Data spots that attract foreigners and Brazilians from other regions.
Following the trend in the national market, builders such as In addition to the malls, the region of Garcia D'Avila Street is
Area (Sq Mi) 3,287,612 MRV are buying large areas throughout the country, includ- Area (Sq Mi) 3,287,612
the most attractive. With major international brands in the
ing in Porto Alegre, for mixed-use residential, commercial retail market, the rental values reached their highest levels
(including shopping malls) and industrial projects. Porto and availability is rare and highly contested.
Alegre also has a network of hotels totaling 6,000 beds and The hotel sector has been very strong as a result of the city’s
GDP 2010 (US$ B) $2,023.53 is still realizing a demand for expansion in this sector. Given GDP 2010 (US$ B) $2,023.53 appeal to the tourist market. Hotels have allied themselves
the positive economic outlook, Wal-Mart has scheduled to major sporting events that will occur in Brazil - FIFA World
the opening of two stores in town; one in avenue Protásio GDP/Capita (USD) $10,470.90
Cup (2014) and Olympic Games (2016). Hotels have received
Alves and another in avenue Eduardo Prado, in the south of substantial government incentives that have offered long term
Porto Alegre. payments, lower interest rates and a focus on sustainability.
Porto Alegre will be one of 12 cities to act as headquarters These sporting events are attracting and benefiting various
for the FIFA World Cup in 2014. The games are predicted sectors of the economy and encouraging the stability and
Unemployment 7.2% Unemployment 7.2% positive momentum throughout Brazil. A growth of 40% in
Rate to have a positive influence on the economy in many ways, Rate
including increased construction on the roads and the subway the real estate market, which has been credited to those
system. FIFA World Cup of 2014 and the Olympic games of sporting events, was already evidenced during the first half
2016 that will occur in Brazil should attract additional of 2010.
investments that will benefit the economic and create long Population (Millions) 193.253
term stability in the country.
Porto Alegre At A Glance Rio de Janeiro At A Glance
Conversion 1.68 BRL = 1 US$ RENT/M2/MO US$ NET RENT/SF/YR Conversion 1.68 BRL = 1 US$ RENT/M2/MO US$ NET RENT/SF/YR
Bulk Warehouse BRL 9.00 BRL 22.50 $ 5.97 $ 14.93 5.00% Bulk Warehouse BRL 13.50 BRL 22.00 $ 8.96 $ 14.60 6.00%
Manufacturing BRL 9.00 BRL 22.50 $ 5.97 $ 14.93 4.50% Manufacturing BRL 13.50 BRL 20.00 $ 8.96 $ 13.27 6.00%
High Tech/R&D BRL 9.00 BRL 22.50 $ 5.97 $ 14.93 5.00% High Tech/R&D BRL 14.00 BRL 22.00 $ 9.29 $ 14.60 6.50%
RETAIL RETAIL
Downtown BRL 45.00 BRL 63.00 $ 29.86 $ 41.81 4.50% Downtown BRL 80.00 BRL 260.00 $ 53.09 $ 172.53 8.50%
Neighborhood Service Centers BRL 36.00 BRL 54.00 $ 23.89 $ 35.83 5.00% Neighborhood Service Centers BRL 50.00 BRL 110.00 $ 33.18 $ 72.99 8.00%
Community Power Center BRL 18.00 BRL 27.00 $ 11.94 $ 17.92 4.50% Community Power Center BRL 80.00 BRL 250.00 $ 53.09 $ 165.90 8.00%
Regional Malls BRL 18.00 BRL 27.00 $ 11.94 $ 17.92 4.50% Regional Malls BRL 150.00 BRL 400.00 $ 99.54 $ 265.44 6.50%
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores BRL 150.00 BRL 350.00 $ 99.54 $ 232.26 7.00%

Sao Paulo, Brazil Santiago, Chile
São Paulo is located in southeastern Brazil and occupies an Although the earthquake that struck the country in March
area of 1,523 square kilometers. It is the state capital of São 2010 was very strong, it did not result in any serious damage
Paulo and the main financial, commercial and corporate to the industry or the confidence in Chile’s capacity to grow
center of Latin America. It is the largest city in Brazil and the in the market. Santiago, the economic epicenter of Chile, did
entire southern hemisphere. It is the most influential Brazilian not suffer significant damage from the earthquake and
city on the global real estate market and is considered the business and government continued with a determined
14th most global city in the world. approach. Certainly a handful of industries did suffer some
São Paulo city represents 12.26% of all Brazilian GDP and losses, but much of that was loss of inventory as opposed
is responsible for more than a third of the total output of to serious damage to real estate properties.
goods and services. The state of São Paulo, is home to 63% In 2010, the overall Class A office vacancy decreased to
of the multinational corporations established in Brazil. In the 5.24%. The absorption of Class A and Class A+ office space
metropolitan area of São Paulo the population reached reached 130,000 SM, more than five times the absorption
22 million people, making it the 6th largest urban market in reached in the same period in 2009. This is a very good sign
the world. of economic recovery. The most significant office project to
The current real estate market is considered to be solid and come on the market is the Titanium La Portada office building,
experiencing positive momentum. There is a shortage of which is designed to be a “green” building with 60,000 SM
Contact Contact of available space. For the next 24 months an additional
land for new ventures in the major centers and demand
NAI Commercial NAI Sarrà 400,000 SM of office space is projected to hit the office
remains high. In the São Paulo office market Class A+
Properties Brazil +1 56 2 347 7000 market. Given the increase in new inventory, over the next
vacancy rates are at 5%. The rental values have reached
+1 55 11 5506 5655 12 months we estimate that vacancy levels will reach 8%.
very high levels, making the city one of the world's most
expensive in this sector. In the Faria Lima av. region, for However, the vacancy rate should drop again after mid-year
example, there is a wait to find Class A+ office space. Even 2011 with renewed growth and demand due to the recovery
in the residential sector, the new projects have being of the global economy and the continued steady economic
absorbed with amazing speed, especially within the lower growth in Chile. The average lease rates in the main Santiago
socioeconomic classes. The upper class have difficulty business areas rose to $26.60/SM. Sale values for new
searching for high standard condominiums homes with office buildings in El Golf, the most exclusive Santiago
large recreation areas, golf courses and horse riding. business district, reached $3,770/SM.
Country Data Country Data Retail rents quoted in high demand areas can reach up to
Due to the favorable economic situation, it is expected that
the industrial market will follow in the foot steps of the office 20 times the price in secondary retail areas and industry
Area (Sq Mi) 3,287,612 Area (Sq Mi) 291,933 players are willing to pay that cost. Shopping mall space in
and retail markets. There is a great demand for industrial
properties that has yet to be answered by the new industrial the market is expected to grow more than 50%. This repre-
GDP Growth 7.5%
condos. The condos are built near major highways and offer GDP Growth 5.0% sents a total of $1.5 million, as projects that were suspended
the advantage of safety and division of common costs. as a consequence of the economic crisis begin to reactivate.
GDP 2010 (US$ B) $2,023.53
Within a 100 kilometer radius of São Paulo is where the best GDP 2010 (US$ B) $199.183 The average sale value for industrial park land is $120/SM
developments in this sector are located. and sale prices haven’t shown significant variations. This
GDP/Capita (USD) $10,470.90 GDP/Capita (USD) $11,587.09 year the Class A warehouse vacancy rate was 2.8% and the
It is believed that the unprecedented economic situation will stock reached 1.4 million SM.
continue through 2011 and beyond. From Q1 to Q2 2010,
Inflation Rate 5.0%
the volume in commercial real estate in the Brazilian market Inflation Rate 1.75% Investment returns have stabilized in the three major asset
has almost tripled, jumping from US $577 million to about classes to range from 7-9% for office, 9-11% for retail and
Unemployment 7.2%
US $1.6 billion. The sporting events for the FIFA World Cup Unemployment 9.0% 11-12% for industrial, indicating that investors continue to
Rate
(2014) and Olympics Games (2016) that will occur in Brazil Rate see Chile as a viable and desirable investment target.
are also key drivers to boost the real estate market in the
coming years.
Sao Paulo At A Glance Santiago At A Glance

Conversion 1.68 BRL = 1 US$ RENT/M2/YR US$ NET RENT/SF/YR Conversion 489.35 CLP = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) BRL 110.00 BRL 150.00 $ 72.99 $ 99.54 4.00% New Construction (AAA) CLP 149,100.00 CLP 199,000.00 $ 28.31 $ 37.78 4.50%
Class A (Prime) BRL 100.00 BRL 130.00 $ 66.36 $ 86.27 5.50% Class A (Prime) CLP 125,000.00 CLP 153,360.00 $ 23.73 $ 29.12 5.30%
Class B (Secondary) BRL 80.00 BRL 120.00 $ 53.09 $ 79.63 6.00% Class B (Secondary) CLP 106,000.00 CLP 127,000.00 $ 20.12 $ 24.11 6.00%
New Construction (AAA) BRL 60.00 BRL 75.00 $ 39.82 $ 49.77 8.00% New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) BRL 60.00 BRL 70.00 $ 39.82 $ 46.45 9.00% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) BRL 60.00 BRL 70.00 $ 39.82 $ 46.45 9.00% Class B (Secondary) CLP 85,000.00 CLP 99,500.00 $ 16.14 $ 18.89 N/A
Bulk Warehouse BRL 19.00 BRL 26.00 $ 12.61 $ 17.25 9.50% Bulk Warehouse CLP 15,500.00 CLP 26,000.00 $ 2.94 $ 4.94 2.80%
Manufacturing BRL 18.00 BRL 22.00 $ 11.94 $ 14.60 8.00% Manufacturing CLP 18,500.00 CLP 24,400.00 $ 3.51 $ 4.63 N/A
High Tech/R&D BRL 18.00 BRL 24.00 $ 11.94 $ 15.93 8.50% High Tech/R&D CLP 31,000.00 CLP 41,500.00 $ 5.89 $ 7.88 N/A
RETAIL RETAIL
Downtown BRL 40.00 BRL 190.00 $ 26.54 $ 126.08 5.50% Downtown CLP 250,300.00 CLP 1,253,000.00 $ 47.52 $ 237.88 0.50%
Neighborhood Service Centers BRL 60.00 BRL 120.00 $ 39.82 $ 79.63 7.50% Neighborhood Service Centers CLP 200,500.00 CLP 301,500.00 $ 38.06 $ 57.24 12.00%
Community Power Center BRL 60.00 BRL 150.00 $ 39.82 $ 99.54 6.00% Community Power Center CLP 385,200.00 CLP 770,400.00 $ 73.13 $ 146.26 5.80%
Regional Malls BRL 150.00 BRL 400.00 $ 99.54 $ 265.44 7.50% Regional Malls N/A N/A N/A N/A N/A
Solus Food Stores BRL 100.00 BRL 200.00 $ 66.36 $ 132.72 5.50% Solus Food Stores CLP 25,680.00 CLP 77,040.00 $ 4.88 $ 14.63 N/A
Office in CBD N/A N/A N/A N/A Office in CBD CLP 1,498,000.00 CLP 2,782,000.00 $ 12,388,270.72 $ 23,006,788.49
Land in Office Parks N/A N/A N/A N/A Land in Office Parks CLP 240,000.00 CLP 278,200.00 $ 1,984,769.68 $ 2,300,678.85
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks CLP 64,200.00 CLP 85,600.00 $ 530,925.89 $ 707,901.18
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park CLP 64,200.00 CLP 128,400.00 $ 530,925.89 $ 1,061,851.78
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land CLP 428,000.00 CLP 642,000.00 $ 3,539,505.92 $ 5,309,258.88
Residential N/A N/A N/A N/A Residential CLP 107,000.00 CLP 256,800.00 $ 884,876.48 $ 2,123,703.55

Bogotá, Colombia San Jose, Costa Rica
Colombia is recognized around the world as an emerging The latest data released by the Central Bank of Costa Rica
country with excellent social and business activities that are shows a very positive atmosphere in the Costa Rican
contributing to rapid economic growth and attracting foreign market. Exports increased 12% the second half of 2010
direct investment. Colombia has a natural supply of minerals compared to 2009 and nearly all economic sectors show
and energy resources. It has the largest coal reserve in Latin progress. Estimates also point to an expected economic
America, and is fourth to Mexico, Brazil and Venezuela in oil growth for 2010 from 3% to 4%, and a 5% increase in the
production. A better than expected growth and the substantial gross capital formation. Also a 7% to 8% increase is
increase in oil production will make it possible for Columbia expected for prices in general.
to receive an investment grade rating.
The office market shows significant recovery. Supply has
Due to positive current conditions and future plans that have increased by nearly 7% on a year-to-year basis, demand is
been established in Colombia, many companies from the growing and prices have increased in almost all sectors. The
U.S. and other countries have already decided that Colombia actual office inventory is 802,506 SM with vacancy rates
is an attractive place to do business. Colombia is a strategic remaining stable below 10%. The demand showed a net
place to provide, produce and purchase products and/or absorption of 41,628 SM. Class A+ buildings did not show
services and foreign companies are realizing their companies any movement compared to Class A properties, which real-
can grow in Columbia. International companies are achieving ized an increase of inventory but with vacancy rates still the
Contact great opportunities through the creation of strategic Contact highest in the market. Class B+ is the most stable with the
NAI Colombia Correa alliances with local companies to benefit from well-established NAI Costa Rica lowest vacancy rate in the market. New projects are under
+1 571 632 4420 local brands, current distribution systems and loyal customers + 1 506 2228 7760 way, especially in the east sector. There are currently four
in a country that has demonstrated respect for foreigners and office buildings under construction with an additional building
foreign investment. International investment in Colombia of almost 30,000 SM almost completed.
continues to grow, especially in the hotel industry, as the
financial incentives offered by the Colombian government The industrial market has also recovered well. New supply
combined with opportunities created by the economic crisis has entered the market throughout the year and the vacancy
present an ideal time to invest in the Colombian hotel industry. rate stands below 9%. The total industrial inventory is
approximately 1.4 million SM and demonstrates a significant
Office market vacancies were above 15% in 2009, but in increase of almost 10% in one year. The demand shows a
2010, due to greater demand from multinational companies, net absorption of 30,000 SM. Prices increased 2% in the
Country Data the vacancy rate for Class A space was approximately 10% Country Data last six months and currently are stable. Alajuela, Heredia
and rental rates were more stable at approximately $30/SM. Area (Sq Mi) 19,700 and SJ West are the sectors that show the largest inventory
Area (Sq Mi) 440,831 Overall, supply continues to lead demand in Class B and C and the lowest vacancy rates. Build-to-suit complexes have
buildings. Important projects for 2011 include Capital GDP Growth 3.8% a large demand and show the lowest vacancy rate and the
GDP Growth 5.0% Towers, a $100 million project that will comprise 8,000 SM highest inventory.
of office space, 2,500 SM of retail space and two hotels. GDP 2010 (US$ B) $35.02 The retail market is the most stable of all markets. The total
GDP 2010 (US$ B) $283.11 Bogota and its neighboring areas encompass more than inventory stands at almost 600,000 SM and the vacancy rate
4 million SM of industrial land. In 2010, the largest vacancy GDP/Capita (USD) $7,350.24 is below 4%. The west sector presents the largest supply and
GDP/Capita (USD) $9,200 among the main industrial submarkets was registered in the recently had a 90,000 SM entry in the inventory with no
suburban market with 83% of the total industrial inventory. Inflation Rate 5.6% vacancy. The demand is still raising and prices have in-
Inflation Rate 2.6 Recent developments include Zona Franca de Occidente, creased almost 3% in the past year. The only commercial
with more than 200,000 SM of industrial space. retail that is suffering are the strip centers located in mixed-
Unemployment
Unemployment 12.0% In the retail sector, demand remained strong with the overall Rate 6.9% use projects. They show high vacancy rates and have been
Rate vacancy rate in Bogotá less than 5% for Class A product and in this condition for almost six months.
rent prices stable. In 2010, Centro Mayor Mall, the largest Interest Rate N/A
Interest Rate 3.0% in Colombia and third largest in Latin America, was opened
with 170,000 SM. It is forecast that in 2011 Colombia will Population (Millions) 4.764
Population (Millions) 45.512 continue to be an attractive destination for both corporate
users and investors.
Bogotá At A Glance San Jose At A Glance
Conversion 1860.50 COP = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion: 510 COL = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) COP 60,000.00 COP 75,000.00 $ 35.95 $ 44.94 8.00% New Construction (AAA) COL 120,960.00 COL 133,056.00 $ 22.03 $ 24.24 40.00%
Class A (Prime) COP 40,000.00 COP 55,000.00 $ 23.97 $ 32.96 10.00% Class A (Prime) COL 108,324.00 COL 120,960.00 $ 19.73 $ 22.03 19.00%
Class B (Secondary) COP 30,000.00 COP 38,000.00 $ 17.98 $ 22.77 15.00% Class B (Secondary) COL 48,384.00 COL 108,864.00 $ 8.81 $ 19.83 8.00%
New Construction (AAA) COP 18,000.00 COP 25,000.00 $ 10.79 $ 14.98 N/A New Construction (AAA) COL 96,768.00 COL 133,056.00 $ 17.63 $ 24.24 45.00%
Class A (Prime) N/A N/A N/A N/A N/A Class A (Prime) COL 96,768.00 COL 157,248.00 $ 17.63 $ 28.64 10.00%
Class B (Secondary) N/A N/A N/A N/A N/A Class B (Secondary) COL 78,624.00 COL 127,008.00 $ 14.32 $ 23.14 9.00%
Bulk Warehouse COP 10,000.00 COP 18,000.00 $ 5.99 $ 10.79 15.00% Bulk Warehouse COL 12,096.00 COL 48,384.00 $ 2.20 $ 8.81 11.10%
Manufacturing N/A N/A N/A N/A N/A Manufacturing COL 24,192.00 COL 60,480.00 $ 4.41 $ 11.02 20.40%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D COL 18,144.00 COL 30,240.00 $ 3.31 $ 5.51 5.50%
RETAIL RETAIL
Downtown COP 120,000.00 COP 200,000.00 $ 71.91 $ 119.84 5.00% Downtown COL 60,480.00 COL 133,056.00 $ 11.02 $ 24.24 10.00%
Neighborhood Service Centers COP 30,000.00 COP 75,000.00 $ 17.98 $ 44.94 N/A Neighborhood Service Centers COL 60,480.00 COL 169,344.00 $ 11.02 $ 30.85 4.00%
Community Power Center COP 15,000.00 COP 22,000.00 $ 8.99 $ 13.18 N/A Community Power Center COL 66,528.00 COL 181,440.00 $ 12.12 $ 33.05 1.00%
Regional Malls COP 20,000.00 COP 30,000.00 $ 11.98 $ 17.98 N/A Regional Malls COL 139,104.00 COL 241,920.00 $ 25.34 $ 44.07 N/A
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores COL 36,288.00 COL 66,528.00 $ 6.61 $ 12.12 2.00%

Kingston, Jamaica Ciudad Juarez, Chihuahua, Mexico
The Jamaican property market in general has suffered less Juarez is the largest city in Chihuahua, with a population of
than many of the developed overseas markets. The banking 2 million inhabitants, and is situated across from El Paso,
system remains strong with no significant fallout or failures; Texas. It has been a destination for foreign manufacturing
however there is a need for additional competition in the since the 1960s. Manufacturing facilities known as
banking sector. One or two new entrants into the market maquiladoras drive the economy. About 33% of Mexico’s
would be welcomed. Currently, interest rates are falling, foreign manufacturing operations are found in Juarez.
with benchmark rates below 10%. Mortgage and other Approximately 330 registered maquiladora operations in
business loan rates have not followed the reduction in Juarez employ over 200,000 people. Juarez hosts Philips,
wholesale rates. Thomson, GM, Electrolux, Yazaki, Foxconn, Lear, Johnson &
There remains a shortage of quality office units with ade- Johnson, GE Medical, Johnson Controls, Delphi and Ford. A
quate parking facilities. Little new space has been built in mix of regional, and international developers have estab-
recent years as development costs for new buildings have lished in Juarez. Institutional developers from the U.S. include
exceeded the developed value. The situation is changing GE, Prologis and Verde. Mexican firms such as Vesta and
and currently, a number of developers are seeking sites O’Donnell have also invested during the last five years.
to develop. In the CBD actual rental rates obtained by land- From 2009-2010 Juarez industrial vacancy rates increased
lords are somewhat capped due to the high monthly main- from 10% to 13%. Most of the leasing activity has been
Contact tenance charges which can be higher than rentals. Office Contact
offset by increased vacancies from consolidations in the
NAI Jamaica yields are around 8.5-9% with rental levels remaining firm. NAI Mexico
market. By the end of 2010 real estate activity is increasing.
+1 876 925 7861 +1 619 690 3029
The only activity in the industrial market has been a small Earlier in the year, most of the activity was from firms trading
number of large owner-occupied developments, mainly in spaces for newer buildings available at discounted rates.
the warehousing and distribution sectors. Rental demand However, as production is increasing across the city, the
for units in the more desirable areas (for staff and medium-term forecast is positive. From 2009-2010 lease
customers) often dictates rental levels. Such space, over rates fell by over 20% and developer incentives such as free
10,000 SF, is limited for rental or purchase. Industrial yields rent are continuing. During 2010, no new construction
are around 10-11% with rental levels remaining firm. began. With vacancies continuing, most companies will
There has been little new expansion in the retail market. opt for existing buildings and few will require build-to-suits
Fallout, with the reduction in retail activity, has been mini- during 2011.
mal. Yields in this market tend to follow the office market. Area (Sq Mi) 758,449
During 2011 Juarez will continue as a “tenants’ market.”
Many retail units are owner occupied. Retail yields are Aggressive incentive options for free rent, tenant improve-
Area (Sq Mi) 4,244
around 8.5-9.5% and again rental levels remain firm. ments and discounted lease rates will continue. Expansions
GDP Growth 5.0%
After a year of little attention in the resort market, there has will be from existing firms that can benchmark the cost dif-
GDP Growth -0.1% ferential between home markets and migrate more business
been some renewed interest in greenfield sites that can GDP 2010 (US$ B) $1,004.04
accommodate 1,000+ room hotels. The long awaited to Mexico. Activity was slow during 2010 in the office sector.
GDP 2010 (US$ B) $13.74 Local firms, government agencies, and global service
US $2 billion Harmony Cove development project by the GDP/Capita (USD) $9,243.03
Tavistock group is slated for commencement in early 2011. providers are concentrated in a limited amount of Class A
GDP/Capita (USD) $5,055.00 options. Overall rates remained stable during 2010, with
Due to the sluggishness of all sectors in the residential Inflation Rate 4.2% vacancies ranging from 10-20% Retail activity continued during
Inflation Rate 12.7% market, development sites have remained unsold. Some 2010 with expansions from Mexican retailers growing on the
owner occupiers have developed industrial/commercial Unemployment 5.0% border markets. Increased activity is projected during 2011.
Unemployment 12.5%
sites for their own use. There are some large city center Rate
mixed-use developments planned in Kingston. With the Unique selling points: Juarez’s critical mass of industrial
Rate
reduction of interest rates from the high teens to under 10% firms, proximity to all U.S. markets and 50-year history with
Interest Rate 4.5%
property investment is now much more viable and of foreign manufacturers ensure the future is bright.
Interest Rate N/A
increasing interest to local pension funds and investors. Population (Millions) 108.627
Kingston At A Glance Cuidad Juarez At A Glance

Conversion 84.50 JMD = 1 US$ RENT/SF/YR US$ RENT/SF/YR RENT/SF/YR
Low High Low High Vacancy Low High Effective Avg. Vacancy
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) $ 12.00 $ 17.00 $ 14.50 N/A
Class A (Prime) JMD 850.00 JMD 1,200.00 $ 10.06 $ 14.20 20.00% Class A (Prime) $ 9.00 $ 13.00 $ 11.00 8.00%
Class B (Secondary) JMD 680.00 JMD 1,000.00 $ 8.05 $ 11.83 20.00% Class B (Secondary) $ 8.00 $ 10.00 $ 8.75 20.00%
New Construction (AAA) JMD 1,500.00 JMD 1,700.00 $ 17.75 $ 20.12 N/A New Construction (AAA) $ 12.00 $ 17.00 $ 14.50 15.00%
Class A (Prime) JMD 850.00 JMD 1,700.00 $ 10.06 $ 20.12 N/A Class A (Prime) $ 9.00 $ 13.00 $ 11.00 10.00%
Class B (Secondary) JMD 680.00 JMD 1,000.00 $ 8.05 $ 11.83 N/A Class B (Secondary) $ 8.00 $ 10.00 $ 8.75 20.00%
Bulk Warehouse JMD 350.00 JMD 1,000.00 $ 4.14 $ 11.83 20.00% Bulk Warehouse $ 3.30 $ 4.00 $ 3.60 11.50%
Manufacturing JMD 500.00 JMD 850.00 $ 5.92 $ 10.06 30.00% Manufacturing $ 4.00 $ 6.00 $ 4.80 11.50%
High Tech/R&D JMD 1,000.00 JMD 1,200.00 $ 11.83 $ 14.20 N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown (High Street Shops) JMD 900.00 JMD 1,100.00 $ 10.65 $ 13.02 N/A Downtown $ 15.00 $ 20.00 $ 13.00 N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers $ 10.00 $ 12.00 $ 9.50 27.50%
Community Power Center (Big Box) N/A N/A N/A N/A N/A Community Power Center N/A N/A N/A N/A
Regional Malls JMD 850.00 JMD 1,200.00 $ 10.06 $ 14.20 N/A Regional Malls N/A N/A N/A N/A
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores N/A N/A N/A N/A
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low/SF Hig/SF Low/Acre Hig/Acre
Office in CBD JMD 40,000,000.00 JMD 130,000,000.00 $ 473,372.78 $ 1,538,461.54 Office in CBD N/A N/A N/A N/A
Land in Office Parks N/A N/A N/A N/A Land in Office Parks $ 5.57 $ 180.00 $ 242,627.52 $ 7,840,745.74
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks $ 3.25 $ 50.00 $ 141,569.02 $ 2,177,984.93
Retail/Commercial Land JMD 40,000,000.00 JMD 130,000,000.00 $ 473,372.78 $ 1,538,461.54 Retail/Commercial Land $ 7.45 $ 24.00 $ 324,519.75 $ 1,045,432.77
Residential JMD 15,000,000.00 JMD 85,000,000.00 $ 177,514.79 $ 1,005,917.16 Residential $ 9.00 $ 19.00 $ 392,037.29 $ 827,634.27

Guadalajara, Jalisco, Mexico Guanajuato, Mexico
Guadalajara, Mexico’s second-largest city, has managed to Guanajuato covers an area of 30,589 square kilometers with
modernize without seriously altering its centuries-old city approximately 5 million inhabitants. It is located in Central
plan or endangering its reputation in Mexico for quality of Mexico in the area known as El Bajio surrounded by five
life. Guadalajara is known as the "Silicon Valley of Mexico,” neighboring states: Jalisco, San Luis Potosi, Zacatecas,
due to multinational firms such as IBM, HP, Foxxcon, Queretaro and Michoacan. The state of Guanajuato is
Flextronics, SCI-Sanmina, and Freescale Semiconductor. the crossroad for two diverse industrial corridors: the Pan
Guadalajara is a destination for electronics, manufacturing, American Highway, which runs to Highway 45, and the
Mexican national firms, and third-party logistics. NAFTA Highway, which runs towards Highway 57 and links
New sectors include call centers and fulfillment operations. South America, Mexico and North America.
Several regional and international developers have made Multimodal capabilities are available in several locations in
large investments during the last five years. These include Guanajuato. Guanajuato hosts six industrial parks throughout
AMB, Prologis, CPA and German funds. Aggressive promo- the state including Castro del Rios, Fipasi, Las Colinas, Opción,
tion has nearly doubled the city’s industrial base during the Santa Fe and Stiva. The industrial market is comprised of
past four years. During 2010, vacancy rates remained stable approximately 8.1 million SF of construction. Guanajuato’s
at 12% throughout the year. During the last 24 months, land main industries include metal mechanics, chemicals, metallic
sale prices ranged from $80-150/SM. Leasing demand in goods, machinery and appliances, paper, beverages and
Contact 2010 was relatively slow, but is expected to increase during Contact tobacco. Major corporations located in Guanajuato include GM,
NAI Mexico 2011. No new construction was initiated during 2010. NAI Mexico American Axle, Colgate Palmolive, Flex-n Gate, Fiberweb, Avon,
+1 619 690 3029 Guadalajara also is becoming a prime location for the busi- +1 619 690 3029 Faurecia, Hino Motors, Getrag Ford, Flexi, Hella and the brand
ness parks offering “back room office” options. new Volkswagen plant, which was just announced by the
The past two years have presented a tenants’ market in Federal Government.
Guadalajara with developers offering aggressive discounts The new intermodal Guanajuato Inland Port (GTO Inland Port)
in lease rates, free rent and tenant improvements. The is a world class project offering logistics, manufacturing and
difference between asking and closing lease rates has been foreign trade benefits integrated in one location. GTO Inland
as high as 15-20% during 2010. Landlords will continue to Port comprises a Strategic Free Trade Zone, Federal Customs
experience excess inventories and it is expected Guadalajara Facility, a rail facility operated by Ferromex and Lintel’s Sanfa
will remain a “tenants’ market” during 2011. Fe Industrial Park located next to the International Airport
Country Data Country Data “Del Bajio.” In the northern region of Guanajuato is San Jose
The office sector has new Class A projects, which are
Area (Sq Mi) 758,449
located in the Puerta de Hierro and Americas-Country de Iturbide, a traditional destination for industrial corporate
Area (Sq Mi) 758,449 users. “Parque Opcion” is the main park, situated in the
corridors. Multinational companies are also seeking space
GDP Growth 5.0%
from 1,500 to 10,000/SF. While office market vacancy in strategic automotive manufacturing zone between the cities
Class B buildings averages 20-25%, finding contiguous GDP Growth 5.0% of Aguascalientes, San Luis Potosi and Silao. This area has
GDP 2010 (US$ B) $1,004.04 10,000 SF options can be challenging. a plentiful labor force of high quality workers living within an
GDP 2010 (US$ B) $1,004.04 easy travel distance. Average lease rates fell 15% due to an
The retail sector in Guadalajara experienced decreased increase in the vacancy rates.
vacancy in 2010, and it will continue throughout 2011.
GDP/Capita (USD) $9,243.03 Guanajuato’s office market is small and most space is com-
Convenience stores such as Oxxo, 7 Eleven, and Waldo’s are
Inflation Rate 4.2%
seeking both in-line and pad sites. Retail space rates and land prised of low-rise, garden office type projects that host local
values remained flat in most commercial submarkets during Inflation Rate 4.2% Mexican firms and global service providers. Lease rates and
Unemployment 5.0% 2010. Strip center construction will return during 2011. land values are steady and not projected to rise during 2011.
Rate Unemployment 5.0%
Guadalajara remains a core market in Central Mexico with The retail sector is comprised of large mixed shopping
Rate
a strong mix of foreign and national firms active in the centers located in middle and low income areas. Plaza El
Interest Rate 4.5%
market. This unique combination of business and quality of Suez in Celaya is the most important power center in the
Interest Rate 4.5%
life will appeal to global firms for many years to come. area hosting a Wal-Mart and three other anchors, a hotel
Population (Millions) 108.627 and Cinepolis. Retail lease rates and land value are expected
Population (Millions) 108.627 to remain stable through 2010.
Guadalajara At A Glance Guanajuato At A Glance

RENT/SF/YR RENT/SF/YR
Low High Effective Avg. Vacancy Low High Effective Avg. Vacancy
New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 4.96 $ 16.55 $ 10.75 5.00%
Class A (Prime) $ 10.37 $ 15.55 N/A 20.00% Class A (Prime) $ 4.96 $ 16.55 $ 10.75 5.00%
Class B (Secondary) $ 8.29 $ 10.37 N/A 25.00% Class B (Secondary) $ 4.06 $ 11.20 $ 7.63 3.00%
New Construction (AAA) $ 23.50 $ 28.50 N/A N/A New Construction (AAA) $ 3.76 $ 15.35 $ 9.75 5.00%
Class B (Secondary) N/A N/A N/A N/A Class B (Secondary) $ 3.00 $ 10.14 $ 6.50 3.00%
Bulk Warehouse $ 4.15 $ 5.18 N/A 9.00% $ 2.23 $ 3.56 $ 2.90 13.00%
Bulk Warehouse
Manufacturing $ 5.18 $ 6.82 N/A 8.00% $ 3.40 $ 4.90 $ 4.15 11.00%
Manufacturing
High Tech/R&D $ 11.15 $ 16.72 N/A 2.00% $ 4.30 $ 5.80 $ 5.05 1.00%
High Tech/R&D
RETAIL RETAIL
Downtown $ 15.00 $ 20.00 N/A 7.00%
Downtown $ 16.20 $ 29.10 $ 22.65 9.00%
Neighborhood Service Centers $ 15.00 $ 20.00 N/A 8.00%
Neighborhood Service Centers $ 15.90 $ 27.50 $ 21.70 8.00%
Community Power Center $ 15.00 $ 20.00 N/A 2.00%
Community Power Center N/A N/A N/A N/A
Regional Malls $ 25.00 $ 55.00 N/A 15.00%
Regional Malls $ 18.60 $ 39.10 $ 29.20 13.00%
DEVELOPMENT LAND Low/M2 Hig/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
Office in CBD $ 700.00 $ 1,500.00 $ 2,832,803.87 $ 6,070,294.00 N/A N/A N/A N/A
Office in CBD
Land in Office Parks $ 250.00 $ 500.00 $ 1,011,715.67 $ 2,023,431.33 N/A N/A N/A N/A
Land in Office Parks
Land in Industrial Parks $ 80.00 $ 150.00 $ 323,749.01 $ 607,029.40 $ 29.00 $ 43.00 $ 117,359.02 $ 174,015.09
Land in Industrial Parks
Office/Industrial Land - Non-park $ 100.00 $ 300.00 $ 404,686.27 $ 1,214,058.80 $ 25.00 $ 38.00 $ 101,171.57 $ 153,780.78
Office/Industrial Land - Non-park
Retail/Commercial Land $ 350.00 $ 800.00 $ 1,416,401.93 $ 3,237,490.14 $ 115.00 $ 345.00 $ 465,389.21 $ 1,396,167.62
Retail/Commercial Land
Residential $ 250.00 $ 750.00 $ 1,011,715.67 $ 3,035,147.00 $ 173.00 $ 590.00 $ 700,107.24 $ 2,387,648.98
Residential
2011 Global Market Report n www.naiglobal.com

71
Matamoros, Tamaulipas, Mexico Mexicali, Baja California, Mexico
Matamoros is a destination market for foreign operations in Mexicali is a thriving metropolitan area with over 900,000
Mexico with over 65,000 workers in approximately 155 residents. It is the capital of Baja California and home to
plants. “By the border, by the sea” has been the slogan approximately 200 maquiladora operations. Mexicali is an
of this community, which borders Brownsville, Texas. industrial center with a high work ethic, contributing to the
Matamoros is located on the major trade corridor (NAFTA relocation of more than 100 new manufacturing companies
Highway) from Mexico serving all points to the Midwest and to Mexicali from 1996 to 2010.
Eastern U.S. Industrial activity was slow during 2010. Four major transac-
Major sectors for industrial export range from heavy steel tions were recorded through October 2010. Valutech
products to metal fabrication, automotive and electronics. Outsourcing expanded to 200,000 SF by leasing half of the
Matamoros hosts five major industrial parks situated on the previous Sony Campus at Las Californias III Industrial Park; this
east and west sides of the metro area. The vacancy rate company refurbishes cell phones and is one of the largest
was 10% at the end of 2010, reflecting the same fall in employers in the city. Technicolor initiated an expansion project
demand and consolidation in Matamoros as the rest of the by leasing the other half of the previous Sony Campus in an
Mexican industrial markets. New projects included Joerns, existing 110,000 SF building; the site has flexibility to be
CS Winds, CRH and Inteva. More demand will occur in 2011 increased by an additional 100,000 SF. Technicolor has been
due to projected expansions from existing operations and a operating in Mexicali for more than 25 years. Grupo Bimbo,
Contact growing supplier base. Industrial land values remained Contact Mexico’s largest bread producer, purchased a 40,000 SF
NAI Mexico consistent during 2010, with asking prices ranging from NAI Mexico building for its Barcel snacks division. This facility will be pro-
+1 619 690 3029 $30-$40/SM. No change is expected for 2011. During +1 619 690 3029 ducing snacks under several brands for the Northwest region
2010, industrial lease rates fell 10-20% for Class B and C of Mexico and also to export to the California market. SL
facilities. Shell rates averaged $.38/SF/ month. No new Industries will also be relocating and expanding its production
of power electronics in a 82,000 SF facility leased from
construction was completed during 2010. During 2011
Corporate Properties of the Americas. SL Industries will be
tenants will experience a “tenants’ market” and receive
adding production lines to its operations located in Mexicali
additional incentives for free rent and time to retrofit space.
for more than 20 years.
Matamoros’ office market is primarily comprised of small
In 2011 Honeywell will be adding space to its R&D labs and
projects hosting local service industries. Only one small also increasing its production in its North Safety division.
office building was constructed during 2010 in the CBD. The “Kenworth Mexicana will be increasing its production line up
Country Data office outlook for 2011 is that rates will remain the same and Country Data
to 60 trucks per day compared to the less than 30 trucks per
demand will be generated from local and regional operations. Area (Sq Mi) 758,449
day last year. Prices for industrial land have remained flat
Retail centers in Matamoros host a mix of domestic and U.S. since the purchase of large development tracts by Thompson
GDP Growth 5.0% Electronics and Alen Industries. Industrial lease rates will
franchisees and big box operations. Growth in 2010 has
GDP Growth 5.0%
been limited to expansions of Mexican retailers; these are remain flat and competitive for 2010." please add, this is
mainly supermarkets (Soriana, Coppel, Aurrera and Smart) GDP 2010 (US$ B) $1,004.04 important.
GDP 2010 (US$ B) $1,004.04
except for HEB and Sam’s Club. 2011 lease rates and land The office market here is small with most office projects
prices will remain the same. GDP/Capita (USD) $9,243.03
no larger than three stories and located in one of three
Matamoros’ unique location on the NAFTA Highway, rail commercial corridors in the city. During 2010, the 3-story
Inflation Rate 4.2% “Solarium Building” started leasing space successfully with
service, its border location, strong industrial tradition and
Inflation Rate 4.2% its new concept of a green building.
its ability to ship overnight to much of the U.S. make it
a destination for foreign firms to locate new projects in Unemployment 5.0%
Rate
Most retail centers are small strip or food and drug anchored
Unemployment 5.0%
Mexico. The long-term outlook is very favorable through neighborhood centers. Lease rates are expected to remain
Rate
2011 and beyond. flat during 2011 and Mexicali will remain a destination for
Interest Rate 4.5%
4.5%
national and new U.S. firms entering the market. It's industrial
Interest Rate
culture, abundant water and natural gas will help to maintain
Population (Millions) 108.627 it as a destination for foreign operations through 2010 and
Population (Millions) 108.627 many years to come.
Matamoros At A Glance Mexicali At A Glance

New Construction (AAA) $ 8.40 $ 18.00 $ 12.00 20.00% New Construction (AAA) N/A N/A N/A N/A
Class A (Prime) $ 6.00 $ 8.40 $ 8.40 30.00% Class A (Prime) $ 12.00 $ 21.60 $ 10.80 14.00%
Class B (Secondary) $ 2.40 $ 6.00 $ 4.80 30.00% Class B (Secondary) $ 3.60 $ 10.00 $ 6.00 10.00%
Class A (Prime) $ 6.00 $ 8.40 $ 8.40 10.00% Class A (Prime) N/A N/A N/A N/A
Class B (Secondary) $ 2.40 $ 6.00 $ 4.80 10.00% Class B (Secondary) N/A N/A N/A N/A
Bulk Warehouse $ 3.36 $ 4.56 $ 4.56 10.00% Bulk Warehouse $ 3.36 $ 4.08 $ 3.84 6.00%
Manufacturing $ 4.56 $ 6.00 $ 5.76 N/A Manufacturing $ 3.84 $ 5.04 $ 5.28 8.00%
High Tech/R&D $ 6.00 $ 6.60 $ 6.36 N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 11.40 $ 14.40 $ 12.96 15.00% Downtown $ 3.60 $ 6.00 $ 4.80 3.00%
Neighborhood Service Centers $ 8.40 $ 9.60 $ 9.00 30.00% Neighborhood Service Centers $ 6.00 $ 7.20 $ 6.60 10.00%
Community Power Center $ 11.16 $ 12.00 $ 11.64 20.00% Community Power Center N/A N/A N/A N/A
Regional Malls $ 9.60 $ 10.80 $ 10.20 10.00% Regional Malls $ 8.40 $ 16.00 N/A 4.00%
Solus Food Stores N/A N/A N/A N/A Solus Food Stores N/A N/A N/A N/A
DEVELOPMENT LAND Low/Acre High/Acre DEVELOPMENT LAND Low/Acre High/Acre
Office in CBD N/A N/A Office in CBD $ 283,400.00 $ 607,287.00
Land in Office Parks N/A N/A Land in Office Parks N/A N/A
Land in Industrial Parks $ 100,000.00 $ 160,000.00 Land in Industrial Parks $ 101,215.00 $ 202,409.00
Office/Industrial Land - Non-park $ 75,000.00 $ 90,000.00 Office/Industrial Land - Non-park $ 80,972.00 $ 182,186.00
Retail/Commercial Land $ 95,000.00 $ 140,000.00 Retail/Commercial Land $ 202,429.00 $ 607,287.00
Residential $ 140,000.00 $ 200,000.00 Residential $ 485,830.00 $ 931,174.00

Mexico City, Mexico Monterrey, Nuevo Leon, Mexico
Mexico City is the capital of Mexico and is located in South- Monterrey, Nuevo Leon, is located in Northeast México, 140
Central Mexico with over 23 million inhabitants. Mexico City miles from the Laredo, Texas, border crossing. It is the third
is seen as the first stop for foreign investors interested in largest city in Mexico, with a population of 4.5 million.
development of industrial, retail and office investments in It ranks second in Mexico’s industrial production through
Mexico. During 2008, Mexico joined the group with the top well-developed communication systems, a highly educated
12 economies in the world ($1 trillion GDP). work force and proximity to the United States.
Mexican firms with headquarters in Mexico City include As the major industrial market in Northeast Mexico,
Grupo Modelo, Televisa, Grupo Azteca, Aeroméxico, Grupo Monterrey hosts multinational corporations such as BASF,
Carso, Telmex, DESC, GICSA and BIMBO. Automotive firms Caterpillar, Daewoo, GE, JCI, Navistar, Mattel, Panasonic,
include GM, Ford, Volkswagen, Nissan, Honda, Fiat and Parker, LG, Whirlpool,Carrier, Rockwell, Ryder, Lego, Arvin
Chrysler. Most multinational companies like Coca Cola, Meritor, MD Helicopters and Hitachi. As headquarters to many
Pepsi, Honeywell, Siemens, Motorola, USG, Microsoft, IBM, of Mexico’s largest firms, Monterrey offers both domestic and
HP, Samsung, Sony, INTEL, LG, P&G and Wal-Mart maintain foreign operations a diverse supplier infrastructure, and also
headquarters in Mexico City. Mexico City and Toluca host the benefits of Monterrey’s high quality of life and low-cost
over 18 million SM of industrial land. At the end of 2009 the workforce. Developers include both regional and international
largest vacancy could be found in Cuautitlan (20%). firms such as CPA, Prologis, and AMB.
Contact The vacancy rate has decreased slowly but consistently Contact
Monterrey offers more than 33 industrial parks with average
NAI Mexico throughout 2010. New developments include Tlalnepantla, NAI Mexico
vacancy rates near 10% at the end of 2010. The industrial
+1 619 690 3029 Toluca-Lerma and most recently Huehuetoca. Lease rates +1 619 690 3029
market was active during the first half of 2010 with 18 new
and land values experienced little decrease and have firms commencing operations. During the second half,
remained steady throughout 2010. several existing companies initiated new plant investments. As
The retail sector cooled rapidly in 2010. Wal-Mart, Costco, of December 2010, there are 15 companies negotiating new
Home Depot, Best Buy and other big box retailers experi- spaces. Activity is projected to remain consistent through
enced growth, even under the negative economic condi- 2011. Industrial lease rates have not fallen significantly during
tions; however, the rate of expansion decreased. Investors 2010, although developers are aggressively offering more con-
are now looking for stand-alone sites, strip and anchored cessions through free rent and tenant improvements.
centers for openings in late 2010 and spring 2011. Excess inventory during 2010 ensured no significant
The office market vacancies were under 10% in 2009 due construction began. Developers will continue to offer
to high demand and limited inventory. New construction aggressive incentives and 2011 will continue as a tenants
projected for late 2009 was delayed and only those buildings market. Much of the excess inventory will be absorbed. The
with over 80% completion were finished. 2010 saw a GDP Growth 5.0% office market grew during 2010. Although vacancy rates
GDP Growth 5.0%
complete reversal with construction of office buildings on the will fall below 10% in 2011, rental rates have not risen.
upswing. The Reforma office corridor alone has four 50+ story GDP 2010 (US$ B) $1,004.04 Currently projects under construction range from 20,000 to
GDP 2010 (US$ B) $1,004.04
buildings under construction. Lease rates are running from 70,000 SF buildings.
$24 to $40/SM/month. In general, the Mexico City office GDP/Capita (USD) $9,243.03
U.S. retailers such as Wal-Mart, Sam’s Club, Costco, Sears
GDP/Capita (USD) $9,243.03 market is strong with a constant demand and should remain and HEB continue to open stores in Monterrey. Home Depot
so through 2012. Inflation Rate 4.2% and Lowes have established a presence. Prospects are
Inflation Rate 4.2%
Mexico City’s outlook is extremely positive and it will strong for many additional big-box retailers and franchises
continue to hold its place as a first stop for investors. Its critical Unemployment 5.0% to expand in Monterrey during 2011. Monterrey’s critical
Unemployment 5.0% Rate
mass, domestic market demand and position as the place in mass of industrial firms, proximity to U.S. markets, and 100
Rate
Latin America for international corporate headquarters, year manufacturing history ensure the future is promising
ensures that growth will continue. Mexico City is a global Interest Rate 4.5%
4.5%
as one Mexico’s premier destination markets.
Interest Rate
destination for both corporate users and investors now and in
the near future. Population (Millions) 108.627
Mexico City At A Glance Monterrey At A Glance

New Construction (AAA) $ 26.65 $ 44.80 N/A 10.00% New Construction (AAA) $ 14.91 $ 19.89 $ 17.83 5.00%
New Construction (AAA) $ 22.50 $ 27.75 N/A 30.00% New Construction (AAA) $ 18.63 $ 29.83 $ 27.87 10.00%
Bulk Warehouse $ 4.65 $ 6.65 N/A 16.00% Bulk Warehouse $ 3.00 $ 3.96 $ 3.20 10.00%
Manufacturing $ 4.45 $ 7.75 N/A 15.00% Manufacturing $ 4.32 $ 5.04 $ 4.35 9.00%
High Tech/R&D $ 5.55 $ 7.75 N/A 20.00% High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 13.32 $ 50.00 N/A 15.00% Downtown $ 27.34 $ 45.98 $ 27.87 6.00%
Neighborhood Service Centers $ 19.80 $ 26.00 N/A 20.00% Neighborhood Service Centers $ 19.88 $ 24.86 $ 21.18 12.00%
Community Power Center $ 27.75 $ 44.40 N/A 12.00% Community Power Center N/A N/A N/A N/A
Regional Malls $ 38.50 $ 44.40 N/A 20.00% Regional Malls $ 25.47 $ 62.45 $ 44.59 4.00%
DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/SF High/SF Low/Acre High/Acre
Office in CBD $ 1,280.00 $ 3,000.00 $ 5,179,984.22 $ 12,140,588.01 Office in CBD N/A N/A N/A N/A
Land in Office Parks $ 408.00 $ 878.00 $ 1,651,119.97 $ 3,553,145.42 Land in Office Parks $ 4.18 $ 18.58 $ 182,079.54 $ 809,339.20
Land in Industrial Parks $ 60.00 $ 243.00 $ 242,811.76 $ 983,387.63 Land in Industrial Parks $ 3.72 $ 10.00 $ 162,042.08 $ 435,596.99
Office/Industrial Land - Non-park $ 100.00 $ 325.00 $ 404,686.27 $ 1,315,230.37 Office/Industrial Land - Non-park $ 1.39 $ 9.29 $ 60,547.98 $ 404,669.60
Retail/Commercial Land $ 215.00 $ 690.00 $ 870,075.47 $ 2,792,335.24 Retail/Commercial Land $ 5.57 $ 46.45 $ 242,627.52 $ 2,023,348.00
Residential $ 265.00 $ 560.00 $ 1,072,418.61 $ 2,266,243.10 Residential $ 13.94 $ 90.00 $ 607,222.20 $ 3,920,372.87

Querétaro, Mexico Reynosa, Tamaulipas, México
Queretaro, with a population of 1.34 million, is located in Reynosa is a dynamic city located on the Northeast border of
Central Mexico, in the famous “El Bajio” region. Queretaro Mexico, across from McAllen, Texas, on the renowned NAFTA
occupies a strategic location adjacent to nine neighboring Highway. Its third international crossing, Anzalduas Bridge will
states. Additionally, Queretaro is positioned on a critical trade generate more growth in 2011 by connecting to a multi-modal
corridor, the NAFTA Highway (57), linking South America, service center in McAllen, allowing distribution to the Central
Mexico and North America. Due to its central location--only and Eastern U.S.
four hours driving distance of 70% of Mexico’s population- Reynosa is one of the top five maquiladora markets in
-Queretaro is a major logistics hub. Mexico offering 13 industrial parks, and hosting over 350
More than 45 million inhabitants live within a 135-mile manufacturing operations. Main sectors include electronics,
radius. During the 1990s, as Mexico City manufacturers metal fabrication, automotive and medical device. Reynosa
moved north--and out of the federal district--many chose has had excess inventories since 2008. During 2010,
to relocate to Queretaro as it was the first major city north vacancies held steady at 12%. With increased activity during
of the State of Mexico. The colonial style and quality of life 2011, vacancies are expected to drop to 10%.
factors greatly enhance its appeal to global investors. New companies establishing in Reynosa during 2010
Queretaro hosts 19 industrial parks and zones. The included Topline and J Cox. Existing operations initiated
Contact automotive sector has four assembly plants, 57 Tier 1 Contact expansions during the second half. These included Kolder,
suppliers, 100 Tier 2 suppliers and more than 30,000 work- Emerson, Invensys, JMI, LG and Thermo Fisher. While rates
NAI Mexico NAI Mexico
ers. Aerospace is the next emerging sector with the estab- have fallen 20-25% since 2008, there was little change
+1 619 690 3029 +1 619 690 3029
lishment of the Brazilian Embraer plant. Industrial vacancies during 2010. Developers continue to offer aggressive rates
during 2009-2010 were at a historical high at 10% During and free rent, ensuring 2011 will remain a tenant’s market.
2010, expansions and new industrial investments included There is a $.10/SF/month differential between Class A and
aerospace suppliers such as Lear Jet. Samsung continued B space. With excess inventory, the only construction was
several new projects and distribution operations such as the build-to-suit initiated for Thermo Fisher. There will be no
Grupo CID expanded in the market. Industrial lease rates fell speculative construction initiated during 2011.
10% in existing industrial space. Increased activity from existing firms is projected for 2011.
Strong competition among developers to offer creative With pent-up demand and the ability to compare Mexico vs.
Country Data incentives and flexible lease contracts ensures that 2011 will Country Data home markets, many firms are planning expansions or to
continue as a “tenants’ market.” At year-end 2010 130,000 migrate affiliated companies. Reynosa’s office market is
SF was under construction for El Marques Industrial Park. Pent comprised of small projects hosting local service industries.
up demand from 2009-2010 will drive higher industrial leasing Most are located near major arteries or close to the border
during 2011. Lease rates are not likely to rise and new and industrial housing communities. No changes in lease
construction will be primarily for build-to-suits for lease and rates are expected for 2011. Availability in Reynosa is limited
purchase. Industrial land prices are flat. Queretaro’s office and lease rates remained stable during 2010. Vacancies
GDP 2010 (US$ B) $1,004.04 sector is comprised mainly of low rise, garden office type GDP 2010 (US$ B) $1,004.04 remained low due to strong demand from Mexican retail
projects. Lease rates and land values in 2011 for office tenants. U.S. retailers such as Subway, Wal-Mart, and 7-11
GDP/Capita (USD) $9,243.03 facilities are projected to remain stable. Retail growth was GDP/Capita (USD) $9,243.03 will continue to invest in Reynosa in 2011.
steady during 2010. Retail construction in 2011 will continue Reynosa’s unique location on the NAFTA Highway, its border
Inflation Rate 4.2% with the launch of mixed-use projects and strip centers. Inflation Rate 4.2%
location, strong industrial tradition and its ability to ship
Queretaro’s outlook is extremely favorable through 2011 overnight to much of the U.S., make it a premier destination
Unemployment 5.0% and beyond due to its unique location on the NAFTA Highway Unemployment 5.0% for foreign firms to locate projects in Mexico. The long-term
Rate Rate
(Hwy 57), Central Mexico proximity to major population outlook is very favorable through 2011 and beyond.
centers, free trade zones, Colonial image and quality of life
expanding electronics, automotive and aerospace sectors.
Querétaro At A Glance Reynosa At A Glance

New Construction (AAA) $ 14.93 $ 20.81 $ 17.87 15.00% New Construction (AAA) $ 8.40 $ 18.00 $ 12.00 7.00%
Manufacturing $ 3.82 $ 4.82 $ 4.32 10.00% Manufacturing $ 3.96 $ 4.44 $ 4.20 13.00%
High Tech/R&D $ 7.80 $ 12.24 $ 10.02 5.00% High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 13.32 $ 22.32 $ 17.82 N/A Downtown $ 4.00 $ 5.50 $ 5.33 N/A
Neighborhood Service Centers $ 14.76 $ 24.48 $ 19.62 N/A Neighborhood Service Centers $ 3.00 $ 5.00 $ 4.85 2.00%
Community Power Center $ 25.68 $ 34.56 $ 30.12 N/A Community Power Center $ 3.00 $ 5.50 $ 5.33 N/A
Regional Malls $ 24.12 $ 44.64 $ 34.38 N/A Regional Malls $ 4.00 $ 5.50 $ 5.33 6.00%
DEVELOPMENT LAND Low/M2 Hig/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/Acre High/Acre
Office in CBD N/A N/A N/A N/A Office in CBD $ 100,000.00 $ 145,000.00
Land in Office Parks N/A N/A N/A N/A Land in Office Parks $ 100,000.00 $ 130,000.00
Land in Industrial Parks $ 32.00 $ 48.00 $ 129,499.61 $ 194,249.41 Land in Industrial Parks $ 75,000.00 $ 110,000.00
Office/Industrial Land - Non-park $ 25.00 $ 35.00 $ 101,171.57 $ 141,640.19 Office/Industrial Land - Non-park $ 75,000.00 $ 85,000.00
Retail/Commercial Land $ 100.00 $ 300.00 $ 404,686.27 $ 1,214,058.80 Retail/Commercial Land $ 95,000.00 $ 140,000.00
Residential $ 150.00 $ 570.00 $ 607,029.40 $ 2,306,711.72 Residential $ 140,000.00 $ 200,000.00

Saltillo, Coahuila, Mexico San Luis Potosi (SLP), Mexico
Saltillo is the capital of Coahuila, located in northeast Mexico. San Luis Potosi (SLP) is the geographic center of Mexico and
Saltillo ranks second in Mexico for international exports. has approximately 1 million inhabitants. It is located in the
Located 180 miles south of the U.S. border with Laredo, Central Mexico region known as “El Bajio.” SLP neighbors 10
Texas, it has a population of approximately 700,000. With states and is situated on NAFTA Highway 57, linking North
27% of the nation’s automotive production, Saltillo ranks and South America. SLP is a strategic hub for logistics with
first in Mexico, and is recognized as a key platform for the the two most important inland ports in Mexico: Borderless and
global automotive industry. Interpuerto, linked by the KCSM rail.
Saltillo is an industrial destination with the main sectors SLP continues to receive large investments from global firms,
including automotive, metal fabrication, electronics, plastics such as General Motors. Primary sectors include metal-
and aerospace. Automotive OEMs such as GM, Chrysler and mechanic, appliances, plastics, automotive, aerospace and
Freightliner are established in Saltillo, while global suppliers now medical device. Thirteen industrial parks in SLP include
such as ITT Industries, Magna Steyr, Magna Sachs, several with free trade zone and inter-modal services.
Quimmco, Johnson Controls and John Deere are also Operations are located mainly at Logistico-Interpuerto,
located here. Main industrial developers in Saltillo include a Millennium, Tres Naciones, Provincia de Arroyos, Impulso,
mix of regional and local developers; these include Amistad, Mexinox, FINSA San Luis Logistik FTZ and Colinas de San
Davisa, Finsa, CPA and Avante-Alianza in eight industrial Luis. The 2010 industrial inventory remained steady; at year
Contact parks. The current vacancy rate for Class A industrial space Contact end, the vacancy rate stood at 14%. During 2010 SLP
NAI Mexico is 7%. Two new industrial parks are under development-- NAI Mexico welcomed McQuay (A/C), TI Automotive, Replas (Plastics), and
+1 619 690 3029 Amistad Airport and Santa Monica North--and scheduled to +1 619 690 3029 LORVA (Logistics) among others. During 2008-2010 land
be completed at the end of 2010.The industrial sector saw prices decreased inside some industrial parks. Industrial lease
continued activity during 2010 and improved performance rates fell 13-15%. Strong competition among developers
vs. 2009. Companies expanding in the market include offering flexible terms ensures that 2011 will continue as a
Aceros Prime, Johnson Controls, Nova Steel, Coil Plus “tenants’ market.” In December 2010, only 119,166 SF was
Mexicana, Delphi, Mubea, Magna Formex, Magnaestampa- under construction–at Logistik FTZ Industrial Park. Much of the
dos and BIC. 2010 continued as a “tenants’ market” and available inventory should be absorbed during 2011.
industrial lease rates remained flat throughout the year. Key incentives, manufacturing cluster development, Free Trade
Freightliner finished the construction of its facility; three new Zones, and logistics and distribution projects will drive demand.
Country Data industrial buildings were finished by Amistad, Davisa and Country Data SLP’s office sector is comprised of low-rise, garden office type
Avante Derramadero. No changes are expected for 2011. projects. During 2010, most tenants were Mexican firms and
Area (Sq Mi) 758,449 The office sector in Saltillo is relatively small. Saltillo offers Area (Sq Mi) 758,449 global firms operating regional offices. Minor speculative office
two high-rise buildings with 20 floors each; small two- or construction is projected for 2011, with lease rates and land
GDP Growth 5.0% three-floor office buildings are still customary. Lease rates GDP Growth 5.0% values remaining stable. Wal-Mart, Costco, Home Depot,
were flat for 2010 and expected to remain the same for Fabricas de Francia, Soriana, Aurrera and Gigante Chedraui
GDP 2010 (US$ B) $1,004.04 2011. The current Class A vacancy rate is 10%. Two new GDP 2010 (US$ B) $1,004.04 are taking advantage of SLP’s growing consumer incomes
shopping malls commenced operations during 2010: and strategic location. During 2010, Grupo Carso started
GDP/Capita (USD) $9,243.03 Sendero Saltillo and Liverpool. A trend in the market is for GDP/Capita (USD) $9,243.03 its newest commercial project anchored by Sears. Retail
small strip center development offering 30 spaces or less. construction in 2011 will focus on new neighborhood centers
Inflation Rate 4.2%
Four projects were inaugurated during 2010. Inflation Rate 4.2% and lease rates will remain stable.
Saltillo’s unique location on trade corridor to Texas, its strong San Luis Potosi’s outlook is extremely favorable through 2011
Unemployment 5.0% industrial tradition and its ability to ship overnight to much Unemployment 5.0% and beyond due to its unique location on the NAFTA Highway
Rate of the U.S. makes it a destination for foreign firms to locate Rate (Hwy 57), world class infrastructure, strategic free trade zones
new projects in Mexico. and inland ports, colonial image and quality of life, expanding
Interest Rate 4.5% Interest Rate 4.5% automotive, appliances, medical and aerospace sectors.
Saltillo At A Glance San Luis Potosi At A Glance

High Tech/R&D $ 5.40 $ 6.24 $ 6.00 N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 10.03 $ 15.60 $ 11.14 10.00% Downtown $ 12.84 $ 23.88 $ 18.33 N/A
Neighborhood Service Centers $ 7.80 $ 10.03 $ 8.91 12.00% Neighborhood Service Centers $ 14.40 $ 25.80 $ 20.16 N/A
Community Power Center N/A N/A N/A N/A Community Power Center N/A N/A N/A N/A
Regional Malls $ 11.14 $ 28.42 $ 15.00 11.00% Regional Malls $ 15.72 $ 33.60 $ 24.72 N/A
DEVELOPMENT LAND Low/SF High/SF Low/Acre High/Acre DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
Office/Industrial Land - Non-park $ 1.67 $ 3.71 $ 72,744.70 $ 161,606.48 Office/Industrial Land - Non-park $ 216.60 $ 658.84 $ 876,550.45 $ 2,666,235.00
Retail/Commercial Land $ 13.93 $ 27.87 $ 606,786.60 $1,214,008.80 Retail/Commercial Land $ 315.88 $ 1,263.53 $ 1,278,322.98 $ 5,113,332.39
Residential $ 11.14 $ 18.58 $ 485,255.04 $ 809,339.20 Residential $ 361.01 $ 496.38 $ 1,460,957.89 $ 2,008,781.69

Tijuana, Baja California, Mexico Torreon, Coahulia, Mexico
Tijuana is located in Northwest Mexico in the state of Baja Torreon is situated in a unique region of North Central Mexico
California. Tijuana shares its border with San Diego, California, known as La Laguna. Bordering Coahuila and Durango, the
and it is considered to be the busiest border crossing in La Laguna area has a population of 1.3 million. Torreon is
the world. This city has hosted the largest concentration of the primary exporter of fabrics and garments in Mexico with
foreign manufacturing firms in Mexico for over 40 years. annual production exceeding 156 million pieces. Twenty of
Even during the recent 24-month global slowdown, Tijuana the Fortune 500 companies are situated in Torreon in the
maintained its position as a cost savings alternative for apparel, automotive and electronics sectors.
global manufacturers. More than 900 global firms are Automotive firms include John Deere, Takata, Delphi, JCI, Linar,
established in Tijuana’s 45 industrial parks. By the end of Alcoa, Sumitomo, Cooper and Metzler. Metal fabricators
2010, vacancy rates had fallen in Tijuana from 15% to 12%, include Lincoln Electric, Caterpiller and Superior Essex while
despite continued consolidations from some firms. Vacancy major textile firms are Parras, RKI, Wrangler, Libra and Lajat
rates for 2011 are forecasted to fall below 10%. 2010 Denim. There are seven industrial parks in the region: Amistad,
continued as a tenants’ market with lease rates falling to Ferropuerto, Jumbo Plaza, Las Americas, Lagunero, Mata-
their lowest mark in 20 years. The 15-25% discounts have moros, San Pedro and Oriente.
been well received by firms trading older space for lower Industrial vacancies remain at historic highs of 20%. Torreon
rates in newer projects. reflected the same decrease in demand and consolidation
Contact Contact
Tijuana fared better than other Mexican markets during as the rest of the Mexican industrial markets. During 2010
NAI Mexico NAI Mexico (Baja)
2010. New firms included Ossur (Iceland), Prime Wheel tenants experienced a “tenants’ market” and received
+1 619 690 3029 +1 619 690 3029
(Taiwan), TPV (Taiwan), PPH (France) and Fisher and Paykel additional incentives for free rent and time to retrofit space.
(New Zealand) Existing operations also expanded to take Torreon’s market has been slow with developers offering
advantage of the cost differential between Mexico and home more aggressive incentives to generate leasing activity
markets. The expansions are expected to increase during during the last 24 months.
2011. The only new construction during 2010 was for Oxxo, Industrial land values remained unchanged during 2010
Casa Chiapa and the initiation of a build-to-suit for Ryerson with the same expected for 2011. No new industrial parks
at the highly desirable El Florido Industrial Park. Lease rates are under development. During 2010, industrial lease rates
will remain relatively stable throughout 2011, with some fell 10-15% in Class B and C facilities. More demand will
escalations in submarkets lacking sufficient inventory. 2011 occur in 2011 due to projected expansions from existing
Country Data will continue as a tenants’ market. Country Data
operations. Firms in the market are experiencing pent-up
One Class A office tower completed construction during Area (Sq Mi) 758,449
demand and are planning to take advantage of the lower
2010. Via Corporativa is one of a small number of Class A operating costs through 2011-2012.
projects in the market. Office lease rates remained There have been no changes to the lease rates in the office
flat during the year. Most of 2011 activity will be clients sector. Torreon offers few high rise buildings but most offices
relocating to trade for better quality space. During 2010, are smaller two- or three- floor projects. No new projects
GDP 2010 (US$ B) $1,004.04 retail continued expansion with Gallerias Hipodromo GDP 2010 (US$ B) $1,004.04
are scheduled for 2011.
completing construction. 2011 will see a limited amount of
GDP/Capita (USD) $9,243.03 new commercial centers concentrated Southeast and South GDP/Capita (USD) $9,243.03 In the retail sector during 2010, only three small strip
(Blvd 2000). Tijuana’s critical mass of industrial firms, centers were inaugurated The trend for additional develop-
Inflation Rate 4.2% proximity to Western U.S. markets and 40-year history with Inflation Rate 4.2% ment will continue through 2011. SORIANA, one of the
foreign manufacturers ensure the future is promising as one largest Mexican supermarket developers, is based in Torreon
Unemployment 5.0% of the premier destination markets in Mexico. Unemployment 5.0% and is expected to continue national expansion during 2011.
Rate Rate Torreon’s unique location on the trade corridor to Texas, its
strong industrial tradition and its ability to ship overnight to
Interest Rate 4.5% Interest Rate 4.5% much of the U.S., make it a destination for foreign firms to
locate new projects in Mexico. The long term outlook is very
Population (Millions) 108.627 Population (Millions) 108.627 favorable through 2011 and beyond.
Tijuana At A Glance Torreon At A Glance

Class A (Prime) N/A N/A N/A N/A Class A (Prime) N/A N/A N/A N/A
High Tech/R&D N/A N/A N/A N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown N/A N/A N/A N/A Downtown $ 5.40 $ 12.97 $ 8.63 5.00%
Regional Malls $ 16.00 $ 50.16 $ 33.10 6.00% Regional Malls $ 29.28 $ 37.84 $ 32.44 10.00%
DEVELOPMENT LAND Low/M2 Hig/M2 Low/Acre High/Acre DEVELOPMENT LAND Low/SF High/SF Low/Acre High/Acre
Office in CBD $ 43.00 $ 1,500.00 $ 174,015.09 $ 6,070,294.00 Office in CBD N/A N/A N/A N/A
Office/Industrial Land - Non-park $ 50.00 $ 130.00 $ 202,343.13 $ 526,092.15 Office/Industrial Land - Non-park $ 3.20 $ 4.84 $ 139,391.04 $ 210,828.94
Retail/Commercial Land $ 30.00 $ 1,500.00 $ 121,405.88 $ 6,070,294.00 Retail/Commercial Land $ 16.00 $ 28.00 $ 696,955.18 $ 1,219,671.56
Residential $ 80.00 $ 450.00 $ 323,749.01 $ 1,821,088.20 Residential $ 7.00 $ 30.00 $ 304,917.89 $ 1,306,790.96

Panama City, Republic of Panama Caracas, Venezuela
Panama has experienced impressive GDP growth, averaging Venezuela offers excellent opportunities for investment due
8.4% since 2006 and projected at better than 6% this year. to extraordinary oil revenues. The level of Venezuela cash
Several factors contribute to the growth, including a reserves at the beginning of the economic crisis ensured that
US $5.25 billion expansion of the Panama Canal to be macroeconomic imbalances did not translate into a severe
completed in 2014, the growth in the Colon Free Trade Zone contraction in the market. The oil sector and oil related indus-
that currently handles US $16 billion in imports and re-ex- tries are the key drivers of the Venezuela economy. Space
ports each year and the growing movement of multinational demand also increased recently due to new players in the
corporations to Panama including Caterpillar, Procter & Venezuelan economy, e.g. Chinese, Iranians and Russians.
Gamble, 3M and over 35 more. The existing office space in The local currency (Bolivar) exchange rate now has three
Panama City consists of approximately 825,500 SM and is legal values in USD terms: 1) US$1= Bs 2.60; 2) US$1 =
showing a 8.5% vacancy rate. Class A+ office is running at Bs4.30 (both for restricted lists of products and services);
a 13.3% vacancy. Class B+ office space has the lowest and 3) the “permuta bond” exchange rate: US$1=Bs5.30
vacancy rate at 5.2%. Class C office makes up 27% of the (Central Bank controlled). Foreign companies usually use
total existing office space in the city. Costa del Este has the second exchange rate to translate their results to their
strong tenancy, followed by Panama North. Panama West home office.
and Panama South have vacancy rates of over 10%,
Contact Reverted Areas having the most vacancy at 18%. Over Contact The office market in Caracas, mostly dependent on foreign
NAI Panama 470,000 SM of office space is currently under construction companies, has become thin. Sale and rental prices increased
NAI Ferca
+1 507 302 0105 and will be delivered in the next 24-48 months. Average due to very low inventory. While construction of new projects
+1 58 212 286 8124
office rents throughout the city are at $19.73/SM per month started, only a few entered the market in 2010. More projects
with an average maintenance cost of $1.55/SM, bringing are slated to be finished in 2011, which will not be enough to
the effective average occupancy rate to $21.28/SM per catch up with demand for Class AAA office space.
month. Class A prime rents are at $26.50/SM. The industrial real estate market also saw low inventory
There has been an increase in activity in the industrial ware- levels in 2010 with rental and sale prices above 2009 levels.
housing sector in 2010, both in new sales and leases as It is expected that this trend will continue in 2011 due to an
well as with several new projects under construction. Large increase in oil revenue and plans from the Chavez adminis-
scale logistics park projects in Panama City around the Toc- tration to reduce unemployment through development of the
Country Data umen International Airport and Panama Pacifico areas will Country Data manufacturing, construction and agricultural sectors. Retail
increase the inventory and promise to improve the quality has also seen low inventory and increased prices.
Area (Sq Mi) 29,119 of product type. Tocumen currently provides over 40 daily Vacancy rates at Class AAA shopping centers are extremely
nonstop flights to 30 countries around the world and the low. The retail sector has benefited from the government
GDP Growth 6.0% growth of the logistics parks will continue to further the policy of increasing consumption of the lower income
GDP Growth -1.3%
importance of Panama as a major logistics hub. Panama population, which increased the demand for retail outlets.
GDP 2010 (US$ B) $23.09 Pacifico, a large commercial redevelopment of the 1,400 Investment in real estate among transnational companies has
GDP 2010 (US$ B) $285.214
hectare former U.S. Howard Air Force Base next to the improved as many companies use this type of investment to
GDP/Capita (USD) $11,700
Panama Canal continues to progress well. Several multina- hedge their Bolívar cash balances against inflation. Due to the
tional corporations are choosing Panama as a regional hub exchange control system in effect since 2006, repatriation of
and/or logistic headquarters due to Panama’s strategic dividends at an official exchange rate of US $1 = Bs. 4.30 is
geographic location, the sophisticated international banking very difficult leaving many companies to invest their Bolívar
center, the use of the U.S. dollar as the local currency and cash surplus in the office/warehouse markets.
Unemployment 6.6%
the corporate incentives created by Law 41 of 2004 Unemployment 8.6%
Rate Rate Venezuela has the biggest oil reserves in the world, a com-
and Law 41 of 2007. Over 40 multinationals are already
modity that will continue to be key to the world economy.
operating in or committed to operate in Panama.
Interest Rate 6.5% Interest Rate 17.98% Due to its foreign exchange reserves, it is estimated that
Venezuela will be able to cope with any temporary variation
of oil prices.
Panama City At A Glance Caracas At A Glance

RENT/M2/MO US$ RENT/SF/YR
Conversion: 4.30 VEB = 1 US$ RENT/M2/YR US$ RENT/SF/YR
Low High Low High Vacancy
Low High Low High Vacancy
New Construction (AAA) N/A N/A N/A N/A N/A VEB 350.00 VEB 520.00 $ 7.56 $ 11.23 2.80%
New Construction (AAA)
Class A (Prime) $ 19.00 $ 25.00 $ 21.18 $ 27.87 9.10% VEB 280.00 VEB 350.00 $ 6.05 $ 7.56 3.90%
Class A (Prime)
Class B (Secondary) $ 16.00 $ 22.00 $ 17.84 $ 24.53 5.20% VEB 180.00 VEB 280.00 $ 3.89 $ 6.05 3.50%
Class B (Secondary)
Class A (Prime) $ 19.00 $ 22.00 $ 21.18 $ 24.53 2.10%
Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) $ 13.50 $ 18.00 $ 15.05 $ 20.07 12.00%
Class B (Secondary) N/A N/A N/A N/A N/A
Bulk Warehouse N/A N/A N/A N/A N/A
Bulk Warehouse VEB 80.00 VEB 150.00 $ 1.73 $ 3.24 N/A
Manufacturing $ 3.00 $ 7.50 $ 3.34 $ 8.36 N/A
Manufacturing N/A N/A N/A N/A N/A
RETAIL N/A N/A N/A N/A N/A
RETAIL
Downtown $ 10.00 $ 60.00 $ 11.15 $ 66.89 5.50%
Downtown VEB 205.00 VEB 390.00 $ 4.43 $ 8.43 N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A
Regional Malls N/A N/A N/A N/A N/A
Regional Malls N/A N/A N/A N/A N/A
Office in CBD $ 1,000.00 $ 3,500.00 $ 4,046,862.67 $ 14,164,019.34
Office in CBD N/A VEB 7,800.00 N/A $ 7,340,820.66
Land in Industrial Parks $ 80.00 $ 180.00 $ 323,749.01 $ 728,435.28
Land in Industrial Parks N/A N/A N/A N/A
Retail/Commercial Land $ 750.00 $ 3,000.00 $ 3,035,147.00 $ 12,140,588.01
Retail/Commercial Land N/A N/A N/A N/A
Residential $ 6.00 $ 2,000.00 $ 24,281.18 $ 8,093,725.34
Residential VEB 250.00 VEB 3,500.00 $ 235,282.71 $ 3,293,957.99

United States
SECTION CONTENTS
Birmingham, AL Indianapolis, IN Middlesex/Somerset Counties, NJ Schuylkill County, PA
Huntsville, AL Cedar Rapids, Iowa City, IA Northern, NJ Wilkes-Barre, PA
Mobile, AL Davenport/Bettendorf, IA Ocean County, NJ Charleston, SC
Phoenix, AZ and Rock Island/Moline, IL Princeton, NJ Columbia, SC
Jonesboro, AR Des Moines, IA Southern NJ Greenville/Spartanburg/
Little Rock, AR Sioux City, IA Albuquerque, NM Anderson Counties, SC
Bakersfield, CA Wichita, KS Las Cruces, NM Sioux Falls, SD
Inland Empire, CA Lexington, KY Albany, NY Chattanooga, TN
Los Angeles, CA Louisville, KY Long Island, NY Clarksville, TN
Orange Couny, CA Baton Rouge, LA New York, NY Knoxville, TN
San Diego, CA Monroe, LA Westchester, NY Memphis, TN
San Francisco County, CA New Orleans, LA Asheville, NC Austin, TX
Ventura County, CA Greater Portland, ME Charlotte, NC Beaumont, TX
Colorado Springs, CO Baltimore, MD Greensboro/High Point/ Corpus Christi, TX
Denver, CO Suburban Maryland Winston-Salem, NC Dallas, TX
Delaware & Cecil County, MD Boston, MA Raleigh, NC El Paso, TX
Washington, DC Western (Greater Springfield), MA Fargo, ND Fort Worth, TX
Fort Lauderdale, FL Detroit, MI Akron, OH Houston, TX
Ft. Myers, FL Grand Rapids, MI Canton, OH Rio Grande Valley, TX
Jacksonville, FL Lansing, MI Cincinnati, OH San Antonio, TX
Martin & St. Lucie Counties, FL Minneapolis/St. Paul, MN Cleveland, OH Texarkana, TX
Miami, FL Kansas City, MO Columbus, OH Salt Lake City, UT
Orlando, FL St. Louis, MO Dayton, OH Washington County, UT
Palm Beach, FL Billings, MT Oklahoma City, OK Burlington, VT
Tampa Bay, FL Bozeman, MT Tulsa, OK Northern Virginia, VA
Atlanta, GA Missoula, MT Portland, OR Seattle/Puget Sound, WA
Savannah, GA Lincoln, NE Allentown, PA Spokane, WA
Honolulu, HI Omaha, NE Berks County, PA Tri-Cities, WA
Boise, ID Las Vegas, NV Bucks County, PA Madison, WI
Southeast Idaho (Idaho Falls/Pocatello) Reno, NV Harrisburg/York/Lebanaon, PA Milwaukee, WI
Chicago, IL Manchester, NH Lancaster, PA Northeastern (Fox Valley/Green Bay), WI
Springfield, IL Portsmouth, NH Philadelphia, PA Casper, WY
Fort Wayne, IN Atlantic County, NJ Pittsburgh, PA Jackson Hole, WY
Birmingham, Alabama Huntsville/Decatur County, Alabama
Birmingham’s market showed poor signals in 2010. The Huntsville is one of the best metropolitan area economic
office, industrial, and retail sectors all saw vacancy rates stories in America for 2010. Once again, Madison County was
rise across the board. The absorption rates continued to be one of the state's leaders in announced jobs for new and
negative with vast amounts of sublease space emerging into expanding employers. Huntsville/Madison County was second in
the market. As the population continues to push south of Alabama in announced jobs, marking 20 consecutive years that
Birmingham, the submarkets are seeing a steady rise in Madison County has been either first or second. The primary
vacancy as the Downtown market dwindles. However, there driver for growth continues to be the Base Realignment and
have recently been signs of a recovery in the near future. Closure (BRAC) process from 1995 and again in 2005.
The office market saw a negative absorption rate rise up to The Huntsville/Madison County real estate market has
negative 490,044 SF. The overall occupancy fell 3% to continued to remain stable throughout most of 2010 even
90.5%. With the sale of the Social Security Building in the though the local economy remains in recession along with the
Downtown market, the $147 million purchase made it one rest of the country. Defense related jobs continue to trickle
of the largest sale transactions in Birmingham’s history. in as a result from BRAC consolidation of 2005. The
The green-lit project to redevelop the Pizitz Building in the Huntsville/Madison County community continues to lead
Downtown market also shows the city’s drive to bring the Alabama again in both population growth and new jobs. All
population back into the market. Delivered into the market market segments have seen some growth in leasing but
Contact during Q1 2010, the Offices at the Summit post some of Contact absorption has slowed to a large degree.
NAI Chase Commercial the highest rental rates in the city. As the economy toils, the NAI Chase Commercial
Commercial property sales remain negligible on large projects
Realty, Inc. office market took a slight hit, but with new developments RE Services, Inc.
but some smaller projects have received financing and been
+1 888 539 1686 and redevelopments breaking ground, the future is bright. +1 888 539 1686
sold. New construction in office, industrial and retail continues
The Birmingham industrial sector continued on a downward to be stagnant due to financing restraints. However, the overall
trend. It too saw a nearly 3% drop in vacancy to about 80%. market continues to remain resilient, albeit much slower than
With the contraction of the construction industry, the industrial in the past. We anticipate more robust growth in mid-2011
market followed in its decline. With only one new multi- through 2012. The office sector received the biggest news
tenant industrial product added to the market, any upswing with approval of a new mixed-use development, Redstone
in the economy will surely be positively felt in the flailing Gateway, which will create an additional 4.6 million SF of first
industrial market. class commercial space over a 10-year period.
Metropolitan Area Metropolitan Area
Birmingham’s retail market surprisingly felt a positive Retail has been slower; however, several projects are under
Economic Overview Economic Overview
absorption. With an increase of almost 3% from the previous construction for retailers like Kroger, Target and several drug-
2010 year, optimism continues to rise. With new product along 200 stores. Manufacturing companies continue a hiring freeze but
Population 1,133,874 the Highway 280 corridor, Hoover area, and just east of the Population 407,958 we anticipate future growth due to BRAC-related demand
city, the outlook is optimistic. The new “Shops of Grand in 2011. The Huntsville market continues to out-pace the
2015 Estimated 2015 Estimated
Population
River” is a 330,000 SF Outlet Center that was delivered in Population 446,143 commercial markets in Alabama with some new build-to-suit
1,172,302
Q3 2010 and is situated just across from a new Bass Pro development occurring in Research Park and vacancy rates
Employment Shops store. Despite the setback of the recent economy, the Employment remaining relatively low to comparables cities.
Population 446,464 promising numbers predict a overall general improvement Population 188,335
Huntsville remains the shining star of the State of Alabama with
to the retail market. Household national recognition and rankings. The Huntsville/Madison
Household
Average Income $61,083 Average Income $63,119 County community continues to receive unprecedented rankings
and recognition for its job growth, technology creation and
Median Median
Household Income $45,636 Household Income $51,241 quality of life.
Total Population Total Population

38
Median Age 38 Median Age
Birmingham At A Glance Huntsville/Decatur County At A Glance

(Rent/SF/YR) Low High Effective Avg. Vacancy (Rent/SF/YR) Low High Effective Avg. Vacancy
New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) N/A N/A N/A N/A
High Tech/R&D $ 9.00 $ 12.50 $ 10.20 8.00% High Tech/R&D $ 8.00 $ 10.00 $ 9.25 10.00%
RETAIL RETAIL
Downtown $ 12.30 $ 25.00 $ 14.50 11.00% Downtown N/A N/A N/A N/A
Community Power Center $ 8.50 $ 19.00 $ 17.00 10.50% Community Power Center $ 8.00 $ 10.00 $ 7.50 10.00%
DEVELOPMENT LAND Low/Acre High/Acre DEVELOPMENT LAND Low High

Office in CBD $ 305,000.00 $ 850,000.00 Office in CBD (per buildable SF) $ 40,000.00 $ 75,000.00
Land in Office Parks $ 195,000.00 $ 310,000.00 Land in Office Parks (per acre) $ 50,000.00 $ 120,000.00
Land in Industrial Parks $ 50,000.00 $ 125,000.00 Land in Industrial Parks (per acre) $ 25,000.00 $ 50,000.00
Office/Industrial Land - Non-park $ 40,000.00 $ 240,000.00 Office/Industrial Land - Non-park (per acre) $ 50,000.00 $ 150,000.00
Retail/Commercial Land $ 320,000.00 $ 850,000.00 Retail/Commercial Land (per acre) $ 225,000.00 $ 750,000.00
Residential N/A N/A Residential (per acre) $ 15,000.00 $ 125,000.00

Mobile, Alabama Phoenix, Arizona
Most sectors remained flat through the first three quarters Arizona’s real estate market was hit harder than most due to
of 2010 as they looked towards a slow recovery from the the collapse of the housing bubble. This downturn set off a
economic crisis. The BP Oil Spill in the Gulf of Mexico had domino effect across the economic landscape from employ-
a direct impact on the Mobile/Baldwin County areas. An ment, retail, construction, manufacturing and tourism. High
estimated $75 million related to clean-up work and loss unemployment, a lack of investment and overall malaise has
claims were injected into the local economy. Ship building shaken a normally confident and entrepreneurial state.
and offshore oil/gas continues to drive an otherwise sluggish Phoenix commercial real estate, which continues to struggle
local economy. due to overbuilding and the lack of demand, still has a way
The office sector experienced several major transactions in to go before more reasonable conditions take hold. Even
2010. BankTrust Corporation signed a 70,000 SF lease in with these dire conditions, there are bright spots and a
the former FNB Building acquired by the Retirement System growing consensus that the coming quarters could bring
of Alabama in the downtown CBD. A continued shortage of much needed positive activity. Some brave investors have
Class A space exists with vacancy running around 10%. No returned to the market interested in premium properties that
new office construction is currently under way or planned. are priced aggressively. They understand that entering the
Class B space remains ample with vacancies around 20%. market before velocity resumes secures future earnings.
The industrial market remains soft with vacancy around 20%. Their re-entry reflects growing optimism that has been
Contact Contact building over the past few quarters.
Two major shipyards in Mobile changed hands during 2010.
NAI Heggeman Realty NAI Horizon
Assets for Bender Shipbuilding were purchased by Signal VCT The multifamily sector is leading the charge back as REITs
Company, Inc +1 602 955 4000
and Atlantic Marine Shipyard, owned by J.F. Lehman Group, and other investment groups that have been sitting on piles
+1 251 479 8606
was purchased by BAE. The new Thyssenkrupp Steel Mill is of cash are eager to invest in quality assets. Industrial ware-
now running in North Mobile County with finished construction house, high-end retail and landmark office properties are
approaching $5 billion. Estimated employment from that among the few bright spots to report. Construction activity
project is around 3,000 new jobs. Although it was antici- has slowed significantly across all sectors so new deliveries
pated to attract suppliers to the area, very little spin-off will not further strain inventory levels as it has over the past
development has occurred thus far. three years. Landlords are caught between a rock and hard
The retail sector remains quiet throughout the Mobile/Baldwin place when trying to retain quality tenants. They realize they
area. Very little new construction has come on the market. are in a renters’ market and must provide concessions, but
Metropolitan Area Metropolitan Area the days of unheard of terms may be coming to end. Still,
Rents remain flat with most renewals actually declining at
Economic Overview Economic Overview lease rates among all sectors continue to drop.
lower rates. Permanent debt remains a challenge. Multifamily
2010 inventory, which saw a major increase of new construction in 2010 Although indicators are down, the basic fundamentals that
Population 410,234 2009, is experiencing slow absorption due to the volume of Population 4,536,069 bring people, companies and investment to Arizona remain
new units coming on line. unchanged. The low cost of housing, warm weather and
Population 414,395 Overall expectations remain optimistic with the hope of a Population 4,943,816
entrepreneurial spirit continue to make Arizona an attractive
major economic development project occurring in the near place to be. Once the gears start turning across the country,
Employment
future. Both the outcome of the EADS/Airbus Air Force Employment many will again focus on the place they had their sights set
Population 157,957 Population 1,826,295 on in the first place–Arizona.
tanker project and the Austall/LCS Naval Project should be
Household announced in the very near future. The timing of either one Household
Average Income $49,690 of these projects could prove to enhance all sectors of the Average Income $76,810
Median
market in 2011.
Median
Household Income $39,492 Household Income $60,724

Median Age 36 Median Age 35
Mobile At A Glance Phoenix At A Glance

RETAIL RETAIL

Office in CBD $ 200,000.00 $ 1,200,000.00 Office in CBD $ 958,000.00 $ 3,700,000.00
Land in Office Parks $ 120,000.00 $ 217,800.00 Land in Office Parks $ 65,000.00 $ 800,000.00
Office/Industrial Land - Non-park $ 40,000.00 $ 261,360.00 Office/Industrial Land - Non-park $ 15,000.00 $ 5,000,000.00
Retail/Commercial Land $ 261,360.00 $ 871,200.00 Retail/Commercial Land $ 40,000.00 $ 6,600,000.00
Residential $ 20,000.00 $ 50,000.00 Residential $ 10,000.00 $ 3,900,000.00

Jonesboro, Arkansas Little Rock, Arkansas
Jonesboro continues to be one of the brightest spots in the Absorption of high density space in the residential and office
mid-south for growth and investment. As a regional hub, markets and the continued expansion of hospitality markets
Jonesboro boasts a trade area of over 500,000 people, are the driving elements of the CBD's growth in Little Rock.
drawing from nearly two dozen counties in Arkansas, Natural gas production and ancillary facilities continue to
Tennessee and Missouri. The city has grown 40% since influence the economic growth in the MSA. On the drawing
1990, and current census estimates that pace of 2-2.5% board, although in the very formative stage, is the City
growth will continue for the next 10-20 years. of Little Rock authorizing the development of a research
Home to Arkansas State University, one of the south’s technology park.
up and coming premiere research institutions, has given Two major production facility announcements lead the
Jonesboro a new dynamic; as specialized training and economic growth in the industrial market: Welspun's $30
partnership programs between ASU and the international million expansion of its steel pipe fabrication facility will
community has added global manufacturing to the city’s increase its investment to $190 million; and Caterpillars'
arsenal of commercial, retail, agricultural and residential $140 million entry into the market with a motor grader
market segments. Nordex USA has recently completed its manufacturing facility. Both facilities are located along the
$100 million facility and began production in October 2010. I-440 corridor near the Port of Little Rock.
Plant expansions are anticipated at Nestle, Alberto Culver In the office market, Southwest Power Pool is developing a
Contact and other major manufacturers. Contact
new $62 million corporate campus in the Chenal corridor
NAI Halsey NAI Dan Robinson
In the financial sector, Regions bank recently divested (WLR). Verizon has absorbed the Alltel corporate campus in
+1 870 972 9191 & Associates
several branch locations throughout the region, allowing Riverdale (Midtown). Windstream, a spin-off of Alltel, made
+1 501 224 7500
other institutions, including Focus bank and IBERIABANK, the decision to permanently locate its corporate offices, thus
the opportunity to expand. IBERIABANK recently made a retaining 300 jobs and creating 210 new jobs (WLR).
significant investment in a new downtown facility. The continued expansion of medical science and research
NEA Baptist has broken ground on its new $300 million programs play a significant role in medical office develop-
healthcare facility that will include clinical space for over ment. A 300,000 SF, 12-story expansion of the Wihthrop P.
120 physicians as well as a state of the art hospital. Rockefeller Cancer Institute provides an infusion clinic and
St. Bernards Healthcare has announced the building of the ancillary support for patients.
Metropolitan Area “Medical Mile” corridor that will literally connect ASU’s Metropolitan Area The retail market saw a rebound in 2010. Target is now
campus with downtown Jonesboro. Ritter Communications open for business in the Park Avenue Center (University
has broken ground on a new corporate campus and is Avenue). Pleasant Ridge and The Promenade are attracting
2010 leading the market in building a complete fiber infrastructure 2010 national tenants (WLR). Shackleford Crossing is recovering
Population 119,895 throughout the city. Population 694,164 with the Wal-Mart Super Center under construction as well
As home to the world’s largest rice mill, Jonesboro has as several extended stay facilities (I-430).
Population 127,109 always enjoyed a lucrative agricultural association. Prices Population 734,885 The Capitol Hotel, Little Rock's flagship, has completed an
for farmland are at an all-time high and continue to set new extensive renovation program and a new Hampton Inn has
Employment Employment
52688
records annually. Multifamily housing is taking on a new look 315,749
also opened in the CBD. The economic drivers for both are
Population Population
in the market with at least two new major developments the growth in Little Rock’s convention/tourism business and
Household under construction that are going to push the price point for Household the continued expansion of programs being offered at the
Average Income $52,065 leasing to a new level in 2011. Red Lobster and Lonestar Average Income $63,888 Clinton Presidential Library (CDB).
Steak House are the latest national chain restaurants to Multifamily residential activity has been slow. There are
Median Median
Household Income $39,890 announce their arrival in 2011. Household Income $51,146 vacancies in existing product to be absorbed and limited
access to development funding. Speculative development
36 37 in the investment market has also been very limited in
Median Age Median Age
2010. The focus, if any, has been on owner/user internal
expansion.
Jonesboro At A Glance Little Rock At A Glance

Class A (Prime) $ 14.00 $ 22.00 $ 12.00 N/A Class A (Prime) $ 13.00 $ 20.00 N/A 12.60%
Class B (Secondary) $ 10.00 $ 16.00 $ 15.00 N/A Class B (Secondary) $ 8.50 $ 15.00 N/A 10.90%
Class A (Prime) $ 12.00 $ 20.00 $ 18.00 10.00% Class A (Prime) $ 16.00 $ 20.50 N/A 16.70%
Class B (Secondary) $ 8.00 $ 15.00 $ 12.00 10.00% Class B (Secondary) $ 12.00 $ 17.50 N/A 5.10%
Bulk Warehouse $ 3.00 $ 6.00 $ 3.50 10.00% Bulk Warehouse $ 1.10 $ 5.75 N/A 16.60%
Manufacturing N/A N/A N/A N/A Manufacturing N/A N/A N/A 1.00%
High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 5.00 $ 12.50 N/A 27.50%
RETAIL RETAIL
Downtown N/A N/A N/A N/A Downtown N/A N/A N/A N/A
Neighborhood Service Centers $ 10.00 $ 22.00 $ 16.00 N/A Neighborhood Service Centers $ 7.50 $ 20.00 N/A 14.50%
Community Power Center N/A N/A N/A N/A Community Power Center $ 15.00 $ 20.00 N/A 4.70%

Office in CBD N/A N/A Office in CBD $ 348.480.00 $ 1,091.250.00
Retail/Commercial Land N/A N/A Retail/Commercial Land $ 108,900.00 $ 1,306,800.00
Residential $ 8,000.00 $ 20,000.00 Residential N/A N/A

Bakersfield, California Inland Empire (Riverside/San Bernardino), California
Much of the news is not positive for owners and developers The “Great Recession” had a dramatic impact on the Inland
in this challenging market. Demand for real estate in the Empire economy. A construction boom prior to the recession
Central Valley & Kern County areas continued to slow in the left the area with an excess supply of homes and commercial
first half of 2010. A continued contraction in the economy, property resulting in the Inland Empire having the highest
unemployment rates near 18% and resistance by tenants foreclosure and vacancy rates in Southern California. Fore-
and investors to the strong increase in rents and prices that closures and vacancy remain troublesome, but are slowly
have taken place in recent years have had a negative impact receding.
on the market. Vacancy rates climbed for all product types Due to the significant amount of excess supply, it will take
through 2010. even more time for the Inland Empire to return to a stable,
Office was particularly hard-hit with continued give-backs pre-recession market. Demand for commercial space is
and/or defaults of space by the mortgage-finance industry, slowly increasing as the economy makes a recovery. Concerns
real estate companies, escrow/title companies and some about the future pace of the recovery are also limiting de-
engineering firms as well as weakened demand from other mand. In general, demand is increasing but not fast enough
office sectors. Vacancy rates continue to climb to the mid to alleviate the ongoing problems in the market.
teens as related to the total Gross Leasable Area (GLA). The industrial market is beginning to show signs of life. High
Rates are projected to climb by another percentage point or vacancy rates have declined and are now in the 13.5% to
Contact two over the next six to 12 months. Contact
15.5% range. Net absorption has been sharply positive for
NAI Central Cal NAI Capital
Industrial vacancy rates climbed, but conditions nevertheless several quarters. Unfortunately for owners, lower vacancy
+1 661 864 1000 (Riverside)
remained tight due to a lack of new construction. The rates have not translated into higher lease rates. Landlords
+1 951 346 0800
Agricultural and Energy sectors continue to drive the biggest NAI Capital continue to use lease rate incentives to attract tenants and
demand for additional space. Users in both sectors are (Ontario/San Bernardino) this has lowered lease rates to approximately $4/SF per year.
active in the market searching for either newer or less +1 909 945 2339 The office and retail markets still remain weak. Office
expensive space for purchase and lease. Large vacancies NAI Capital vacancy rates have fallen slightly but are still high compared
at the Tejon Industrial Complex in South Kern account for (Temecula Valley) to other markets. Vacancy rates for Class A space are now
nearly 1% of the total GLA vacancy factor. We expect the +1 951 491 7590 30.4% compared to last year’s 32.8% reading. However,
upward trend in vacancy to flatten as rents soften. the fall in vacancy rates has not stopped the decline in lease
Metropolitan Area Retail vacancy rates appear poised to climb over the next Metropolitan Area rates. Class A office space is now renting for about $25/SF
12 months and effective rental rates are expected to drop. per year, nearly $2/SF per year lower than 2009 numbers.
New construction retail projects in the outlying areas of each Retail vacancy rates have increased slightly for some
2010 submarket, the ones chasing residential development, have 2010 product but declined for others. For example, vacancy rates
Population 830,222 the highest vacancy rates. Residential development land Population 4,235,027 in malls have declined to 2.8% while vacancy rates for
continues to be the market’s most difficult asset. Kern neighborhood centers have increased to 13.1%. Retail lease
Population 888,432 County has nearly 3,500 buildable lots recorded and over Population 1,444,828 rates are now below $20/SF per year.
25,000 paper lots in some form of development. Year to
Employment date permits have approximately 500 permits pulled for new Employment
Population 58,229 construction. Annualized numbers for new construction at Population 1,321,430
Household
this rate put 3.5 years worth of buildable lots in inventory Household
Average Income $56,960 and over 25 years worth of paper lots in the pipeline. Average Income $66,603
Median Median

38 33
Bakersfield At A Glance Inland Empire (Riverside/San Bernardino) At A Glance

RETAIL RETAIL
Community Power Center $ 19.80 $ 27.00 $ 23.40 16.00% Sub Regional Centers $ 3.00 $ 108.00 $ 19.41 10.70%

Office in CBD $ 87,120.00 $ 261,260.00 Office in CBD N/A N/A
Land in Office Parks $ 217,800.00 $ 435,600.00 Land in Office Parks $ 206,250.00 $ 1,026,786.00
Office/Industrial Land - Non-park $ 34,444.00 $ 65,667.00 Office/Industrial Land - Non-park N/A N/A
Residential $ 25,000.00 $ 127,500.00 Residential (per acre) N/A N/A
82 2010 Global Market Report n www.naiglobal.com 2010 Global Market Report n www.naiglobal.com 82
Los Angeles, California Orange County, California
Los Angeles County is home to one of the largest, most Orange County was the epicenter of failed mortgage com-
diversified economies in the United States. Sun, beaches, panies, as several national sub-prime lenders were head-
Hollywood and numerous other attractions draw tourists to quartered in the county. The demise of these and other
Los Angeles from around the world. companies, combined with robust construction, created a
The Port of Los Angeles is the nation’s leading container port glut of excess office space. Potential new tenants remained
and the Port of Long Beach is the nation’s second largest port scarce during the recession, and are only slowly becoming
by dollar volume. The entertainment and music industries are more plentiful.
headquartered in the County. Major universities such as USC, Still, Orange County has begun a slow recovery back to good
UCLA and CalTech employ and educate thousands of people health. For the first time since 2007, Orange County has
a year. seen net absorption in office, industrial and retail vacancy.
Despite its diversity and numerous strengths, Los Angeles Office vacancy rates remain stubbornly high. However, they
has felt the pain of the “Great Recession.” Unemployment are receding in all segments. Class A vacancy rates have
increased as wages fell. Median home prices fell as fore- declined 0.7 percentage points to 20.5%. Class B rates are
closures soared. Lease rates declined while vacancy rates approaching 16%. Persistent high unemployment and
increased. Vacancy rates for new office space remain a slow economic recovery will delay a robust recovery for
Contact stubbornly high, above 30% in the County. Class A vacancy office space, but the market is slowing improving.
NAI Capital (Encino) Contact
rates are about half that for new space but still high by Retail centers such as Fashion Island, South Coast Plaza
+1 818 905 2400 NAI Capital (Newport Beach)
historical standards. Rental rates are still declining as and the Irvine Spectrum have helped Orange County’s retail
NAI Capital (West Los Angeles) +1 949 854 6600
+1 310 440 8500 evidenced by the $2.00/SF decline for Class A space. Rental markets avoid the worst of the recession. Vacancy rates for
NAI Capital (South Bay) rates for Class B space have fallen but not by much. In the malls have fallen to 3.1%. Unfortunately, this is not true of
+1 310 532 9080 suburban areas Class B rental rates have fallen a mere other retail space. Neighborhood and community center
NAI Capital (Commerce) $.03/SF per year. vacancy rates have increased. Neighborhood centers have
+1 323 201 3600 fared the worst as lease rates have increased to 8.5% while
NAI Capital (Pasadena)
Industrial vacancy rates have fallen to approximately 8.6%. At
9.0% the R&D segment has the highest vacancy rates. Rental lease rates have fallen to $23.04/SF per year.
+1 626 564 4800
NAI Capital (Santa Clarita) rates continue to soften across the board. Rental rates for Industrial vacancy rates are still rising in most segments.
+1 661 705 3550 industrial space are in the low to mid $6.00/SF range. Vacancy rates for warehouse and manufacturing increased
Unlike the other markets, retail vacancy rates increased. On Metropolitan Area to 10% while rates for R&D space declined to 9.2%. Improv-
Metropolitan Area average, retail vacancy rates increased .04 percentage ing vacancy rates could not stop the fall in lease rates. Rental
Economic Overview
Economic Overview points from last year. On a positive note, rental rates have rates in all segments fell a little more than $1.00/SF.
2010
2010 increased for some retail products. Malls and community Construction activity came to a halt during the recession and
Population 3,090,761
Population 13,331,266 centers experienced a small but positive $.04/SF per year has showed very little signs of life since then. Excess
increase in rents. Retail discounters continue to open new 2015 Estimated capacity, stringent lending standards and lack of credit are
2015 Estimated stores. They along with quick-service restaurants are the Population 3,151,668 preventing construction from rebounding. To date, lenders
most active in the market. Outlet malls have experienced have shown little willingness to loosen lending standards or
Employment
Employment strong tenant interest. Vacancy rates are very low and rental to increase credit. Even if lenders do change their stance,
Population 5,359,491 rates are still very strong. Unfortunately, the same is not true excess capacity mitigates the need for new space.
for rents in downtown market or neighborhood centers Household
Household throughout the County. Average Income $101,916
Average Income $81,158
Median
Median Household Income $79,132
Household Income $59,881
Total Population
Total Population Median Age 35
33
Median Age
Los Angeles At A Glance Orange County At A Glance

DOWNTOWN OFFICE SUBURBAN OFFICE
RETAIL RETAIL
Downtown $ 7.20 $ 120.00 $ 29.52 5.00% Downtown $ 33.0 $ 36.00 N/A N/A
Regional Malls $ 12.00 $ 65.00 $ 22.50 3.60% Regional Malls N/A N/A $ 36.00 3.1%.

Office in CBD $ 6,225,059.86 $ 6,225,059.86 Office in CBD N/A N/A
Land in Office Parks $ 658,617.00 $ 6,397,028.00 Land in Office Parks) $ 2,216,066.00 $ 6,308,544.00
Land in Industrial Parks $ 663,507.00 $ 3,059,238.00 Land in Industrial Parks $ 649,589.00 $ 789,746.00
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park $ 2,230,152.00 $ 3,778,802.00
Retail/Commercial Land $ 456,091.00 $ 4,421,769.00 Retail/Commercial Land N/A N/A
Residential N/A N/A Residential N/A N/A

San Diego, California San Francisco, California
San Diego’s economy showed signs of improvement in San Francisco struggled as much as any major international
2010 compared to 2009. The county’s housing market led market during the prolonged economic slump, but the worst
the U.S. in price increases until August, when home prices now appears to be behind it. A global city with a broad
dropped 0.6% from July, attributable to the end of home- economic base, a growing tech sector helped offset losses
buyer tax credits. San Diego’s housing market has found the in the banking, legal and financial sectors, and the market
bottom. Improvement in prices is not expected soon and is was further aided by an empty pipeline of new construction.
dependent upon job growth. Many homeowners are under- Vacancy rates trended downward during 2010 but the overall
water with existing mortgages, which will lead to continued vacancy rate of 13.5% recorded at the end of Q3 2010 was
defaults and foreclosures. still up slightly from the same time a year earlier. Absorption
Improved activity in the office market resulted in a decrease turned positive after several quarters of negative absorption
in the countywide vacancy rate to 15.3% in Q3 2010 with that put over 1 million SF of space back on the market since
positive net absorption of 740,000 SF. Average rents Q4 2009. Class A rents stabilized early in the year and were
declined by 1.7% from 2009 to $25.99/SF. The largest beginning to rise at year’s end. However, there is still a
office lease signings in 2010 were Nokia with 196,735 SF significant overhang of sublease space weighing on the
and Mitchell International with 141,000 SF. The first six market with over 2.1 million SF available, about 75% of
months of 2010 registered 19 transactions totaling $373 which is Class A space.
Contact million, or $264/SF. Office cap rates fell to 7.97% from Contact
With tenants sensing a bottoming, several large lease signings
NAI San Diego 8.36% in 2009. The largest sale was a medical building in NAI Global
took place in 2010 as major tenants moved to lock in
+1 619 497 2255 Poway for $74 million, or $462/SF at a 7.6% cap rate. +1 609 945 4000
rates that are about 30% below the 2007 peak. Notable
The industrial market saw vacancy increase to 11.2% and transactions include Salesforce.com Inc.’s lease of 260,519
rental rates fell to $9.86/SF with negative absorption of SF at One Market St.; Morrison & Foerster LLP’s lease
291,800 SF as of the end of Q3 2010. The largest lease of 220,000 SF at 425 Market St. and Deloitte’s lease of
signings were BikeBandit.com for 107,000 SF and BAE 166,435 SF at 555 Mission St., all in the downtown core.
Systems with 86,000 SF. Midway through 2010, 31 industrial The investment sales market also came back to life during
buildings had sold for a total volume of $200 million and an the latter half of 2010, with several significant sale transac-
average price of $114/SF. Cap rates increased in 2010 to tions reported, including Market Center (770,000 SF,
8.44% from 7.11% in 2009. The largest industrial sale was $344.15/SF); 333 Market St. (657, 115 SF, $506.76/SF);
Metropolitan Area the 134,000 SF Time Warner building for $32.75 million or Metropolitan Area
303 2nd St. (731,972 SF, $323,78/SF); 255 California Street
Economic Overview $244/SF at a 7.66% cap rate. Economic Overview
(173,747 SF, 241.73/SF) and 351 California St. (136,791
2010 The San Diego retail market experienced little change in 2010 SF, $255.86/SF). Domestic and foreign pension funds, REITs
Population 3,120,279 2010. At the end of three quarters, the vacancy rate was Population 4,394,426 and private equity are among the most active buyers.
5.4% and average asking rents were $22.39/SF. The largest The industrial market struggled throughout 2010 with
lease signed in 2010 was Costco for 111,000 SF. During Population 4,511,295 vacancy on the rise and absorption remaining in negative
the first six months of 2010, 17 retail sales occurred with territory. There are few large blocks of space available but
Employment an aggregate volume of $178.3 million and an average price Employment
total vacancy is in excess of 1 million SF.
Population 1,353,252 of $241/SF. Cap rates increased in 2010 to 8.27% from Population 1,935,251
7.62% in 2009. The San Francisco retail market experienced little change in
Household Household 2010. Average quoted rental rates slipped a bit even though
Average Income $78,340 Average Income $109,182
the overall trends were mostly positive. Absorption was
Median Median slightly positive for the year and overall vacancies remained
Household Income $60,699 Household Income $80,613 low, in the 3-3.5% range. The amount of vacant sublease
space continued to decline.
35 Median Age 38
Median Age
San Diego At A Glance San Francisco At A Glance

New Construction (AAA) $ 34.32 $ 36.00 $ 35.64 N/A New Construction (AAA) N/A N/A N/A N/A
Manufacturing $ 3.48 $ 48.84 $ 8.04 9.00% Manufacturing N/A N/A N/A N/A
RETAIL RETAIL
Neighborhood Service Centers $ 6.72 $ 60.00 $ 24.24 8.00% Neighborhood Service Centers N/A N/A N/A N/A

Office in CBD N/A N/A Office in CBD $ 5,200,000.00 $ 14,900,000.00
Land in Industrial Parks N/A N/A Land in Industrial Parks N/A N/A
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park $ 1,500,000.00 $ 12,600,000.00
Retail/Commercial Land N/A N/A Retail/Commercial Land $ 3,500,000.00 $ 12,000,000.00

Ventura County, California Colorado Springs, Colorado
Ventura County offers its residents a high-quality lifestyle The local economy and the corresponding real estate market
that includes low crime rates, easy access to Los Angeles has been a mirror image of the national economy. Colorado
and some of the largest agricultural and mountain preserves Springs has experienced the worst commercial real estate
in the region. The county is home to companies such as market in 18 years. Our problems are reflective of the
Amgen, Dole Foods and Bank of America’s residential unit. national economy in that we have lost primary employment
Agriculture employs countless workers and contributes jobs in the last two years and capital markets are still
approximately 5% of the county’s GDP. The U.S. Navy stagnant. However, we have weathered the storm better
maintains two Ventura County facilities, generating an esti- than most. Our current unemployment rate is 8.7%, almost
mated 14,000 to 17,000 stable jobs. a full point below the national average.
The demise of lender Countrywide severely impacted The latter part of 2010 has seen an increase in primary job
Ventura County’s office market. Vacancy rates soared while growth as we will end the year with a net gain of over 400
lease rates fell. Although the office market has yet to recover employees. Our local economic development group shows
from this shock, it appears that the market is beginning to increased activity from employers looking to relocate to
stabilize. Net absorption has turned positive and lease rates Colorado Springs. Fort Carson continues to increase its troop
for Class A space remain steady at 19.6%. More impor- levels as the post will grow to 26,000 by 2013. Colorado
tantly, the decline in rental rates has subsided. Rental rates Springs has a strategic central location, wonderful quality
Contact for Class A space declined a meager $.07/SF from last year. Contact of life and a 91.9% cost of living quotient.
NAI Capital (Ventura County) NAI Highland
Improving international trade will benefit the Port of Hueneme The overall real estate market has seemed to benefit somewhat
+1 805 278 1400 Commercial Group, LLC
and the industries that support it. Improvements in the from the above employment gains and military expansion within
NAI Capital (Westlake Village) +1 719 577 0044
industrial segment are expected; however, they will likely be our area. After two consecutive years of negative absorption
+1 805 446 2400
NAI Capital (Simi Valley)
limited. Compared to last year vacancy rates increased it appears 2010 will end the downward spiral. The overall
+1 805 522 7132
approximately 3% across all segments. Surprisingly, rental office market vacancy has decreased from a high this year
rates for warehouse increased to $7.12/SF. We attribute this of 16.1% to 14.3%. The industrial sector has seen a slight
gain to the increase in trade and the warehouse space increase in occupancy as vacancy rates moved from 11.8%
needed to accommodate imported/exported goods. to 11.3% over the year. The aggressive rates offered by SBA
Led by the Thousand Oaks mall, the vacancy rate for malls and compressed sales prices have attracted several tenants
is declining. In fact, mall vacancy rates now stand at 1.7%. into ownership positions.
This gain has come at the expense of neighborhood and As consumer spending and job opportunities decreased over
community centers. Neighborhood centers experienced the the most recent time frame, the retail sectors have not found
2010 825,436 brunt as vacancy rates hover around 10.7%. Interestingly, 2010 firm ground. The vacancy rate has increased from 7.9% to
Population rental rates for all retail segments have declined. We suspect Population 638,782 11.5%. As in all sections of the market, we see building
that mall landlords have decreased vacancy by offering rent owners offering many incentives to attract and retain ten-
2015 Estimated 843,700 2015 Estimated
Population
incentives to new and existing tenants. Population 684,729 ants. The land market continues to languish as the available
vertical product vacancy rate is almost two times the rate
Employment 364,606 Employment needed to spur demand for new product. The projection for
Population Population 290,120 Colorado Springs is for the economy to slowly improve
Household Household
during 2011 and to see real change beginning into the 2012
$95,804
Average Income Average Income $73,236 time period.
Median $77,837 Median

Household Income Household Income $61,662
Total Population 36 Total Population

35
Ventura County At A Glance Colorado Springs At A Glance

Class A (Prime) N/A N/A N/A N/A Class A (Prime) $ 13.50 $ 15.50 $ 14.50 9.70%
New Construction (AAA) N/A N/A $ 43.20 60.70% New Construction (AAA) $ 15.50 $ 17.50 $ 16.50 50.00%
Class B (Secondary) $ 11.40 $ 41.47 $ 23.44 17.20% Class B (Secondary) $8.00 $ 10.00 $ 9.00 14.50%
RETAIL RETAIL

Office in CBD N/A N/A Office in CBD $ 653,000.00 $ 1,524,600.00
Land in Industrial Parks $ 1,135,074.00 $ 1,135,074.00 Land in Industrial Parks $ 130,000.00 $ 218,000.00
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park $ 87,000.00 $ 218,000.00
Residential N/A N/A Residential $ 30,000.00 $ 75,000.00

Denver, Colorado Delaware/Cecil County, Maryland
Located on the western edge of the Great Plains, Denver is Delaware’s unemployment rate slowly decreases, hovering
the largest city in the Rocky Mountain region. Its diverse at 8.4% into Q4 2010. Activity among all product types
industry base and highly educated workforce place Denver remained slow throughout the year and vacancy remained
in an excellent position for business growth and economic high. The lack of construction on the horizon is expected to
development. Recent groundbreakings on mass transit help recovery as activity inches upward. In all sectors,
projects, including a redevelopment of downtown’s Union interest outweighs demand.
Station and expansion of Denver’s light rail system, are Businesses continue to seek to improve their bottom line
sparking other transit-oriented development, and the start but many are unable to make changes. Expiring leases are
of a local recovery. trending toward shorter-term renewals and transactions are
As 2010 concludes, Denver, and the entire Front Range, is slower to close than at the peak. All sectors do show a slow
poised for a strong rebound as the economy and consumer increase in activity. Lease rates continued to drop through
confidence returns. Supply and demand is generally in the first six months of 2010, stabilizing during the summer.
balance, the result of a slowdown in new construction and A gradual increase is expected as office and industrial users
an increase in business efficiency. The Denver Office market increase production and add staff.
vacancy rate has seen small amounts of ebb and flow over The decrease in retail rates was not as severe, with strip
the past year, and sits slightly stronger than in 2009. The retail remaining in demand. Retail vacancy rates dropped in
Contact vacancy rate decreased slightly from 14.8% in 2009 to Contact
the CBD and power centers, as retailers relocated or closed.
NAI Shames Makovsky 14.5% in 2010 and with four continuous quarters of positive NAI Emory Hill
New space at the Christiana Mall was mostly absorbed with
+1 303 534 5005 absorption, more than 1.8 million SF was absorbed by the +1 302 322 9500
minimal remaining vacancy; new stores are coming online in
market in the last year. Even with this positive movement, 2011. Electronics retailers continue their expansion as well.
rental rates have remained low and stayed flat at $19.97/SF.
The largest industrial transactions have been the renewal
Data also shows the direct vacancy rate in Denver’s indus- of DuPont’s lease in Pencader Corporate Center and a lease
trial market declined to the lowest level reported since the to an out-of-state manufacturer that took advantage of State
Q4 2007. However, lease rates remain soft and are likely to and County incentives. The largest office transactions have
move very little until employment growth strengthens leasing been in Newark’s Iron Hill Corporate Center, at the Hercules
activity. Plaza and The Delaware Academy of Public Safety and
Metropolitan Area The retail market in Denver also experienced a slight Metropolitan Area Security’s lease in Newark. The University of Delaware’s
improvement in market conditions in 2010. The vacancy 2009 purchase of Newark’s former Chrysler plant will result
rate went from 7.0% in 2009 to 6.1% in 2010 and net in a new R&D site, under construction. Building will continue
2010 absorption was 828,591 SF in the last year. Much of this 2010 through 2012 with the Thomas Jefferson medical facility
Population 2,601,114 positive movement was driven by a reduction in rental rates; Population 885,000 opening by 2013. Accordingly, the market anticipates interest
quoted rental rates decreased 14.8% from $16.41/SF to from the R&D sector. Fisker’s purchase of Newport’s GM
Population 2,803,132 $13.97/SF. Population 940,449 assembly plant has lessened the impact on the job market
Results of a survey released by PricewaterhouseCoopers and prevented an increase in vacancy. The slow increase in
Employment
suggest commercial property investors are returning to the Employment activity will be maintained through 2011 with industrial
Population 1,281,645 Population 610,289 interest leading. Lease terms will increase in length as well.
market in many areas, including Metro Denver. Investors are
Household generally focused on high performing, Class A assets, with Household
Average Income $86,500 some respondents saying debt financing is again available. Average Income $82,365
Respondents also said Metro Denver remains a buyers' Median
Median
Household Income $68,870 market for office property but is on track for recovery. Household Income $67,809

36 36
Denver At A Glance Delaware/Cecil County, Maryland At A Glance

Premium (AAA) $ 23.00 $ 34.56 $ 28.73 13.00% New Construction (AAA) $ 26.00 $ 33.00 $ 28.00 25.00%
RETAIL RETAIL

Office in CBD $ 9,856,378.48 $ 16,332,752.61 Office in CBD $ 1,742,400.00 $ 2,613,600.00
Land in Office Parks $ 115,384.62 $ 5,881,188.12 Land in Office Parks $ 150,000.00 $ 350,000.00
Office/Industrial Land - Non-park $ 4,284.63 $ 16,332,752.61 Office/Industrial Land - Non-park $ 150,000.00 $ 350,000.00
Retail/Commercial Land $ 5,285.71 $ 14,549,040.00 Retail/Commercial Land $ 150,000.00 $ 400,000.00
Residential $ 2,242.99 $ 8,571,428.57 Residential $ 15,000.00 $ 125,000.00

Washington, District of Columbia Fort Lauderdale, Florida
The nation's capital is also its strongest commercial real Fort Lauderdale is a service market for southeast Florida. The
estate market and it continues its track to recovery propelled major industries are tourism, finance and service related
by federal government activity in 2010. Vacancy rates saw business with a strong segment of international trade. This
a small reduction in Washington, DC, after a decisive uptick area is serviced by three seaports, Port of Miami, Port
in demand coincided with the continued thinning of the Everglades and the Port of Palm Beach, as well as three
development pipeline. international airports. Most sectors of the economy continue
The catalyst for growth was distributed among various to be stagnant. Most major industries are experiencing de-
government agencies, with Internal Revenue Service (IRS), pressed economic conditions.
Securities and Exchange Commission (SEC), Veterans Affairs The office market experienced a decline in occupancy and
and Health and Human Services among the most aggressive rental rates and is expected to weaken through 2011. Rents
tenants in the market. In addition to government activity, the are down substantially, with intense competition for new or
investment sales side picked up. expanding tenants. There is no new office construction in the
Asking rents for office space increased for the first time market. Office vacancies are in the 15-20% range.
since Q2 2008 when rents began falling. Asking rents are Industrial vacancies are in the 15-20% range. Rents are
expected to remain flat throughout the remainder of the year dropping, with industrial rent for large space as low as
Contact in the core DC markets. With more than 1 million SF of Contact $2.50/SF gross. Small tenant space is a large part of the
federal requirements in the market, the government will market with vacancies running as high as 50% and rents as
NAI KLNB, LLC NAI Rauch, Weaver,
continue to drive demand in the District and continue to low as $4.50/SF gross. There is no new industrial construc-
+1 202 375 7500 Norfleet, Kurtz & Co.
lease up buildings in the NoMa, Southwest and Southeast tion planned for 2011 or 2012 except for build-to-suit space.
+1 954 771 4400
submarkets at competitive rates. Private sector leasing Vacancies in the retail market increased each month in 2010
activity and absorption are unlikely to grow in the short term. to reach 20%. Many major retailers have closed stores with
Law firms are leaving large blocks of older Class A product on the trend expected to continue through 2013. As a result,
the market coupled with an abundance of Class B options. small tenants have experienced extreme difficulties resulting
In retail, conditions were worse in the suburbs than the core in more closures every month.
city. Everywhere, it became increasingly more difficult to Investors are delaying major purchases unless they can buy
close deals, as everyone scrutinized them more closely than at 40-50% of previous values. Cap rates are up to at least
Metropolitan Area ever. The slight overall dip in rental rates experienced Metropolitan Area 8.5-10.5% based upon current income without credit for any
nationally was not as dramatic in the DC region. The banking vacant space.
crisis and recession led to a virtual halt in bank leases and
2010 their inflated rents. An influx of fast casual hamburger joints, 2010 The multifamily sector had some transactions but most sellers
Population 5,500,613 yogurt shops and bakeries took over as the opportunities Population 5,513,060 do not want to discount prices. Multifamily occupancy is up
arose. New York-based restaurant operators saw opportunity with most projects above 90% occupancy. Rents on multi-
2015 Estimated 2015 Estimated family projects are trending upward but most owners are
Population 5,737,130 in the DC market and targeted high-traffic venues around Population 5,588,658
Verizon Center in Chinatown. Buildings in Dupont Circle, careful not to raise rates aggressively for fear of losing
Employment which were never previously considered for restaurant uses, Employment tenants. The policy of most landlords is to do anything to keep
Population 2,820,605 were re-fitted to support venting configurations. Population 2,369,262 the current tenants in place as new tenants are few and
far between. Lenders are extending loans in a delay and
Household Household
$102,588 $69,571
pray process. New construction is not on the horizon for
Average Income Average Income
2011-2012.
Median Median

37
Median Age Median Age 40
Washington At A Glance Fort Lauderdale At A Glance

New Construction (AAA) $ 40.00 $ 70.00 $ 63.50 N/A New Construction (AAA) $ 25.00 $ 29.00 $ 27.00 0.20%
Manufacturing N/A N/A N/A N/A Manufacturing $ 3.00 $ 6.00 $ 4.50 0.20%
RETAIL RETAIL
Community Power Center $ 15.00 $ 40.00 $ 20.00 N/A Community Power Center $ 20.00 $ 35.00 $ 22.00 0.10%

Office in CBD $ 2,600,000.00 $ 96,000,000.00 Office in CBD $ 500,000.00 $ 1,000,000.00
Land in Office Parks N/A N/A Land in Office Parks $ 300,000.00 $ 600,000.00
Land in Industrial Parks N/A N/A Land in Industrial Parks $ 220,000.00 $ 500,000.00
Retail/Commercial Land $ 2,600,000.00 $ 96,000,000.00 Retail/Commercial Land $ 400,000.00 $ 700,000.00

Ft. Myers/Naples/Port Charlotte/Bonita Springs, Florida Jacksonville, Florida
2010 began much like 2009 with vacancy rates rising along Jacksonville’s convenient location, skilled labor force,
with unemployment rates. Development has been slowed reasonable cost of living, high quality of life and business-
as lending institutions start to realize the effects that the friendly government make it a popular location for corporate
economy has had on commercial real estate. Companies expansions and relocations. In 2010, Jacksonville continued
like McGarvey and the East Group continue to gear up for to emerge as a leading international logistics/distribution
“green” and sustainable, responsible development, but are center and intermodal hub, with a transportation network
proceeding with caution and remain attentive to prospects embracing port and air cargo facilities and rail and trucking
needs and demands. routes. Millions of tons of raw materials and manufactured
Confidence in the region remains high. The overall opinion is goods move through the city annually.
that 2011 will see a regional comeback with acceptable and A number of Jacksonville’s major office tenants relocated
satisfactory growth. Southwest Florida has many positives when to the suburbs in 2010, leaving abundant space available
you consider it’s a coastal location and the impact of its quality in the city’s urban core. However, aided by the resurgence
of life. Southwest Florida also can boast that many prominent in suburban leasing activity, 2010 overall office vacancy
former and current business executives live in the area at least rates declined to 15.5% from 2009 rates of 15.8%. This
part of the year. This expertise and experience serve as trend bodes well for the gradual absorption of vacant space
valuable resources to the business community. and the potential for new construction in 2011.
Contact Contact
Our area is home to many higher education campuses: In 2010, The Port of Jacksonville’s 1,000-acre Foreign Trade
NAI Southwest NAI Commercial
Edison State College, Hodges University, Ave Maria University Zone #64 was ranked third best of its kind in the world
Florida, Inc. Jacksonville
and Florida Gulf Coast University, which is a member of the by industry experts, and its handling of 20-foot equivalent
+1 239 437 3330 +1 904 358 2717
State University System of Florida. 2011 may see the container units grew to nearly 846,000, surpassing 2009
beginning of the Madden Research Loop in the Fort Myers numbers by 17%. Jacksonville is the second-busiest port
area and the expansion of Jackson Laboratories into for automobiles in the nation, and just fewer than 519,000
Collier County creating high-caliber, high-wage positions. automobile units went through Jacksonville in 2010, which
The region stretches from the 10,000 islands north to Port represented a 24% year-over-year increase.
Charlotte and from the Gulf of Mexico east to Lehigh Acres. Jacksonville experienced a “tenancy challenge” in 2010 as
This area continues to be home to a growing population of retailers closed underperforming locations and cut overhead
young professionals, and opportunities continue to grow costs, and big box growth remained stagnant. Vacancy in
Metropolitan Area other industries, including biotechnology and healthcare. Metropolitan Area
the retail market remained virtually unchanged, with the
The John Madden Company is planning to break ground overall rate going from 8.5% in the fourth quarter of 2009
2010 on its Research Loop at the Southwest Florida International 2010 to 8.6% at the end of 2010. On the upside, the upscale,
Population 191,506 Airport, which will introduce new, high-paying career Population 1,389,042 specialty shopping center, St. John’s Town Center, which
opportunities that will only further propel our region was completed in 2005, continued to expand and post
Population 197,711 forward. Charlotte, Collier, Hendry and Lee Counties Population 1,487,422 record sales.
reported increased unemployment in 2009. Lee County's Jacksonville’s multifamily sector saw 10 properties change
Employment unemployment rate rose to 14.5% in 2010. Collier County’s Employment
hands in 2010, the majority of which were distressed
Population 68,032 unemployment rate increased to 13.9% and Charlotte Population 590,644
properties sold either by the lender or through special
Household
County’s figure grew to 13.7%. The unemployment is not Household servicers. Occupancy rates rose 3.8% to 90.3% from
Average Income $70,701 seasonally adjusted. Average Income $68,438 86.5% at the end of 2009. The market outlook remains
cautiously optimistic as new multifamily construction is not
Median Median
Household Income $48,780 Household Income $54,392 expected for the immediate future.

48 37
Ft Myers/Naples/Port Charlotte/Bonita Springs At A Glance Jacksonville At A Glance

New Construction (AAA) $ 20.00 $ 24.00 $ 21.00 19.00% Premium (AAA) N/A N/A N/A N/A
RETAIL RETAIL
Regional Malls $ 18.00 $4 0.00 $ 25.00 20.00% Regional Malls $ 10.70 $ 25.16 $ 19.44 5.20%
DEVELOPMENT LAND Low High DEVELOPMENT LAND Low/Acre High/Acre

Office in CBD (per buildable acre) N/A N/A Office in CBD $ 225,000.00 $ 575,000.00
Land in Office Parks (per acre) $ 196,020.00 $ 283,000.00 Land in Office Parks $ 115,000.00 $ 405,000.00
Land in Industrial Parks (per acre) $ 109,000.00 $ 87,000.00 Land in Industrial Parks $ 120,000.00 $ 325,000.00
Office/Industrial Land - Non-park (per acre) $ 87,000.00 $ 1,090,000.00 Office/Industrial Land - Non-park $ 75,000.00 $ 515,000.00
Retail/Commercial Land (per acre) $ 350,000.00 $ 750,000.00 Retail/Commercial Land $ 120,000.00 $ 950,000.00
Residential (per acre) N/A N/A Residential $ 8,000.00 $ 445,000.00

Martin/St. Lucie Counties, Florida Miami, Florida
After three years of declining property values and low levels While there are mixed signals in the marketplace, the
of transactions, the Martin and St. Lucie County markets consensus is that Miami has stabilized and will grow slowly
have experienced a slight upturn in activity. Prices appear through 2011. Pricing on both the leasing and sales side
to have declined to a point of attracting users who have have stabilized; residential occupancies are improving and
weathered the economic conditions off of the sidelines and commercial occupancies should improve by mid-year.
into the market as both renters and buyers. Investment activity is showing signs of life with the majority
The office market has shown some level of stability; of the activity in multifamily residential.
however, crunched landlords are not able to provide tenant Multifamily pricing witnessed a 50% decrease in 2009 and
improvements that are often required and this has put many has rebounded by 10% in 2010. With occupancies increasing
buildings at a deeper disadvantage than others. Overall due to foreign buyers and financing for first time homebuyers,
activity is slow and the majority of the space available is pricing should increase by 10% with rental rates following in
small tenant space. Most of the larger big box spaces have the second half.
been absorbed by new market participants at significantly Retail demand is rebounding as consumers are spending
discounted rental rates. Bankruptcies of national companies again. Despite stores closing, supply is in balance because
have also hurt some inline spaces as tenants seek to of barriers to entry. Well-capitalized, experienced retailers
renegotiate leases signed in peak market times. are utilizing rent reductions and availabilities to obtain key
Contact Contact
There has been an increase in industrial activity; however, locations previously considered too expensive. Rental rates
NAI Southcoast NAI Miami
the flex space phenomenon that encompassed the majority should remain stable and vacancy rates should decline
+1 772 286 6292 +1 305 938 4000
of the development between 2004 and 2006 has proven to marginally through year-end. REITs are purchasing quality
be non-functional for typical businesses of greater than retail assets now priced at higher cap rates.
2,000-3,000 SF. The majority of this space was designed The office sector is divergent. While few submarkets’
without dock height space, appropriate large semi-truck vacancies remain in balance, the CBD, Brickell and other
maneuverability and no allowance for yard storage. There submarkets are witnessing vacancy rates of 20% or more.
remains between 750,000 and 1 million SF of industrial Most large tenants have relocated or renegotiated favorable
space available. Approximately 75% of this space is flex terms in premier buildings. Rental rates in weakened
space and has had little activity. submarkets will continue to fall at a mitigating pace, while
Metropolitan Area Land remains the slowest market with land values at levels Metropolitan Area healthy submarkets should stabilize. Unless job creation
not seen since the late 1980s early 1990s. Land listings are begins in earnest, vacancy rates will be stagnant.
approaching 15% to 30% of the previous sale prices or face Investment activity is marginally improving. Cash buyers
2010 values of mortgages. Much of this land still has little interest 2010
seek opportunities, principally in multifamily. Commercial
Population 420,706 and what offers can be generated are significantly lower Population 5,513,060
buyers cautiously sift through availability focused on acqui-
than asking price. sition of promissory notes. Cap rates have risen and are
Population 454,656 Overall, 2010 has shown an improvement in activity; Population 5,588,658 stabilizing at pre-2006 levels. Activity should increase from
however, by no means an end to the downward slide of levels seen in 2009-2010, but nowhere near 2007 levels.
Population 152,441
property values. There has been a lack of sales activity in 2,369,262
Development activity remains moribund and land prices
Population
the investment sectors and sales activity has primarily been should remain at cyclical lows.
Household concentrated to owner/user properties. Household Industrial markets are improving with large blocks absorbed,
including a 342,000+ SF transaction. As global economies
Median Median improve, so will local markets. Miami’s largest trading
Household Income $50,222 Household Income $51,835 partner, Brazil, is experiencing strong growth, which bodes well
for exports. Airport and Port of Miami expansion is continuing,
Median Age 48 40 increasing capacity and ease of access. Rental and occupancy
Median Age
rates are stable and should be throughout 2011.
Martin & St. Lucie Counties At A Glance Miami At A Glance

High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 6.01 $ 20.10 $ 11.61 8.80%
RETAIL RETAIL
Regional Malls N/A N/A N/A N/A Regional Malls $ 14.00 $ 51.26 $ 28.99 3.00%

Office in CBD $ 215,000.00 $ 400,000.00 Office in CBD $ 2,250,000.00 $ 5,000,000.00
Residential $ 15,000.00 $ 30,000.00 Residential $ 50,000.00 $10,890,000.00

Orlando, Florida Palm Beach County, Florida
The Orlando area economy is slowly recovering from the The local economy continues to be stagnant. The rate of
national recession. While the August 2010 unemployment descent in the local markets has slowed, but stubbornly high
rate was 11.9%, the rate of job losses in most industries unemployment–above 12%–continues to hold growth
has slowed. Healthcare services, business services and down. The market is beginning to see positive indicators as
leisure and hospitality are showing job gains. Domestic and population net in-migration to Florida has resumed.
international tourists have bolstered retail sales in the tourist A resolution to the foreclosure volume will begin to further
commercial submarket. Construction and housing-related stabilize the market.
industries will be the last to see a meaningful recovery, The volume of sales of income-producing property is well
impacting the local industrial and office markets. below historical levels. There are few quality properties for
The overall Orlando office vacancy rate stands at 15.4%. sale as banks and special servicers seem more inclined
Average lease rates are down in most submarkets due to to “pretend and extend” rather than liquidate assets. One
vacant sublease space. Vacancy rates are highest in Class sector of the market that is strong is multifamily housing.
A buildings and downtown. The largest lease signing in When quality properties become available they are selling
2010 was Fidelity Information Systems moving into 115,130 quickly and in some cases at cap rates of 6% or lower.
SF in Maitland Center. New office construction remains low The industrial, retail and office markets continue to be
with 158,000 SF under construction at the end of Q3 2010. negatively affected by the unemployment picture and the
Contact About 70% of the space under construction is pre-leased. Contact
demise of the residential market. Housing continues to
NAI Realvest Office building sales activity has increased in number of NAI Merin Hunter
struggle and foreclosures are an ongoing issue. The lack of
+1 407 875 9989 transactions; however, average price per SF has declined Codman, Inc.
new residential construction continues to plague small
and cap rates have averaged 8.8%. +1 561 471 8000
space industrial properties and the lack of job growth
The overall Orlando industrial vacancy rate stands at 12.8%. negatively impacts the office market. Many large office users
Net absorption has been positive for three consecutive have vacant desks that will need to be filled before there is
quarters. Vacant sublease space continues to decrease as an increase in demand for office space. There has been
well. However, lease rates have yet to recover and are down some activity, particularly in Boca Raton, from large office
from 2009. The largest lease singings included 216,500 SF users who are taking advantage of the economic incentives
by McKesson Corporation and 101,000 SF by FedEx Smart that are in the market.
Post at Crossroads Business Park. New industrial construc- General interest has picked up during the year but completed
Metropolitan Area tion is minimal with only one 53,550 SF building currently Metropolitan Area
transactions have been slow to occur in all sectors as
Economic Overview under construction. Sales of industrial properties are up in Economic Overview
expressed uncertainty about future business conditions is a
2010
terms of dollar volume. Average price per SF has fallen to 2010 recurring negative in the market. Vacancy rates in all sectors
Population 2,130,826 about $60 and cap rates have risen to 9.5% for recent Population 1,294,546 have begun to stabilize. We expect to see a continuation of this
transactions. trend in 2011 with most forecasts pointing to an improvement
Population 2,278,942 Retail vacancies are expected to improve as the wave Population 1,318,909
by the end of the year. Trade and South American investment
of store and restaurant closings subsides. New restaurant and in-migration continue to be positive economic factors.
Employment chains are entering the market. Dollar stores continue Employment There is virtually no new speculative development activity.
Population 952,655 to thrive and expand throughout the market. Hobby Population 509,032
Lobby opened its first 53,000 SF store at Colonial Plaza. Household
Household
Average Income $67,452 Quoted lease rates are trending lower in the near-term. New Average Income $79,764
construction remains minimal with 258,000 SF currently
Median under construction. Median

37 45
Orlando At A Glance Palm Beach County At A Glance

New Construction (AAA) $ 26.00 $ 28.00 $ 26.75 30.00% Premium (AAA) N/A N/A N/A N/A
RETAIL RETAIL
Regional Malls $ 14.00 $ 40.00 $ 24.00 4.30% Regional Malls N/A N/A N/A N/A

Land in Office Parks $ 218,000.00 $ 700,000.00 Land in Office Parks N/A N/A
Land in Industrial Parks $ 108,900.00 $ 218,000.00 Land in Industrial Parks N/A N/A
Retail/Commercial Land $ 218,000.00 $ 700,000.00 Retail/Commercial Land N/A N/A

Tampa Bay, Florida Atlanta, Georgia
The Tampa Bay area boosts one of the most densely populated Georgia has been growing since the late 1960s, and the
markets in the state of Florida. The area offer tremendous Atlanta metropolitan area currently boasts a population
quality of life and is home to the Tampa Bay Rays baseball of more than 5.6 million, making it the seventh largest
team and Buccaneers football team and Lighting hockey metropolitan area in the U.S. Atlanta continues to attract a
team. The affordability of the housing market makes the area talented workforce and is home to some of the nation’s
a very desirable place to live. top companies. The area draws companies eager to take
Having bottomed in early 2009 the entire Tampa Bay market advantage of low business and living costs, global connec-
is rebounding at an accelerated pace. Transaction volume tivity through the airport, top research universities and high
overall has resumed and activity levels have increased quality of life.
10-fold in the last 24 months. The bay area apartment market Overall, Atlanta’s office market has begun to gradually
bottomed in the first quarter of 2008. The volume of transac- rebound from the recession as reflected by healthy leasing
tions continues to increase at an accelerated pace. Rental activity. This leasing activity is dominated by consolidation
rates have stabilized and concessions appear to be burning and downsizing by corporations looking for cost savings, so
off at a rapid pace. the increased number of deals does not translate to lower
Vacancy levels in the office market have increased to 14% vacancy. With over 200 million SF of inventory, the Atlanta
regionally. Sublease space continues to shadow the market. office market has recorded negative net absorption with little or
Contact Contact no new construction. Vacancy rates are averaging 20.3% and
Concessions continue to be the normal course of business NAI Brannen Goddard
NAI Tampa Bay tenants are benefiting from aggressive concession packages
and tenants are shopping every space in the market before
+1 727 585 2070 +1 404 812 4000 and reduced rental rates.
committing. The sublease market is estimated at a two-year
supply but mostly concentrated in the suburban markets. The Atlanta’s industrial market, with over 10 million SF of leasing
Westshore core district continues to expend with several new activity through Q3 2010, is starting to show signs of life.
projects breaking ground in late 2010. There has been a noticeable increase in total leasing and
The industrial sector remains tepid with only minor increases sales activity and a decrease in the amount of negative net
in occupancy. The port continues to expand and new industries absorption over the last several years. Currently there is
such as SRI and Draper international continue to offer new over 571 million SF of inventory. With over 2.6 million SF of
resources of tenant base. The local industrial market suffers deliveries YTD, vacancy rates remain elevated at 14% and
from an abundance of functionally obsolete product type with rental rates have decreased slightly from this time last year.
low ceilings and fixed interior components. New Flex space Atlanta’s retail market, with over 321 million SF of inventory,
in the I-4 corridor is the hot new market with several large will continue to adjust itself with some vacant centers that
2010 facilities currently under construction. 2010 were ill conceived. New development will continue to be
Retail continues to be a challenging environment based on
Population 5,611,180 pocketed and occur more in urban areas as housing growth
current economic trends. The market conditions have stalled continues to be weak. Vacancy rates are high in many areas
2,884,757 several new developments slated for 2010 due to credit crisis Population 6,180,206 (±15%) and rent adjustments downward continue to press
Population
and lack of national retailer response. The new Cypress Creek landlords. Tenant choices have never been better.
1,113,646
Mall is expected to be the second largest mall in the state of 2,350,787
Atlanta is building toward a tech hub in the Southeast, with
Florida and is currently on hold until conditions improve. the world’s busiest international airport, a healthy cluster of
Household Household corporate giants and a spike of new entrepreneurial activity.
Average Income $62,236 Average Income $85,998 This has put Atlanta in the top 10 on this year’s Kauffman
Entrepreneurial Index, which tracks new business creation.
Median Median

43 35
Tampa Bay At A Glance Atlanta At A Glance

Premium (AAA) $ 25.00 $ 35.00 $ 30.00 30.00% New Construction (AAA) $ 23.00 $ 32.62 N/A 80.00%
New Construction (AAA) $ 25.00 $ 35.00 $ 30.00 30.00% New Construction (AAA) $ 22.00 $ 26.95 N/A 73.00%
Manufacturing $ 3.50 $ 7.50 $ 5.50 25.00% Manufacturing $ 2.00 $ 4.00 N/A 12.90%
High Tech/R&D $ 4.50 $ 9.50 $ 6.50 20.00% High Tech/R&D $ 3.29 $ 8.47 N/A 17.00%
RETAIL RETAIL
Downtown $ 9.00 $ 14.00 $ 12.00 20.00% Downtown $ 10.00 $ 40.00 N/A 8.00%
Neighborhood Service Centers $ 10.00 $ 20.00 $ 15.00 20.00% Neighborhood Service Centers $ 9.16 $ 19.34 N/A 15.00%
Community Power Center $ 16.00 $ 20.00 $ 18.00 20.00% Community Power Center $ 10.33 $ 28.00 N/A 8.70%

Office in CBD $ 40,000.00 $ 125,000.00 Office in CBD $ 435,600.00 $ 1,089,000.00
Retail/Commercial Land $ 100,000.00 $ 400,000.00 Urban Retail/Commercial Land $ 1,000,000.00 $ 4,000,000.00
Residential $ 25,000.00 $ 150,000.00 Retail/Commercial Land $ 125,000.00 $ 400,000.00
Residential $ 20,000.00 $ 150,000.00

Savannah, Georgia Honolulu, Hawaii
Per regional economic indicators, Savannah's three-county Hawaii's economy ranks as the 39th largest in the United
MSA entered recovery in early 2010. Home of the fourth States. The Honolulu market is showing signs of recovery.
largest U.S. container port, record shipping volume has The hospitality and retail sectors are the first to benefit from
helped the logistics industry. Tourism (11.1 million tourists the weakening U.S. dollar, attracting increased visitors from
annually) has remained stable with strong improvements in international markets. The strong Japanese Yen is driving
hotel occupancies. Employment has stabilized with gains increased investment transactions in the office and retail
in healthcare and private education. The housing market, markets. Office and industrial sectors are still showing signs
and the associated construction industry, continues to of further declines due to cutbacks by both private and
drag on the regional economy. Modest economic growth is government agencies.
forecasted through 2010 into 2011. Hawaii's economy is closely linked to market conditions in the
Demand across all industry sectors in 2010 was down with U.S. and key international markets, particularly Japan, and has
little development barring build-to-suit projects. Coastal remained more resilient than most U.S. mainland markets.
Logistics Group broke ground on a 320,000 SF rail-served Honolulu is making steady progress towards recovery as rising
facility in CenterPoint's new 233-acre intermodal center. visitor volume from Canada, Korea and Japan helped to offset
Port-related speculative development prior to the recession continued declines in American visitors.
has left industrial vacancies around 19%. As the port volume The hospitality and retail trade sectors are especially bene-
Contact continues to improve, there is at least an 18-month supply Contact
fiting from the sharp declines in the value of the U.S. dollar.
NAI Savannah to be absorbed. NAI ChaneyBrooks
New hospitality and retail related venues are being planned
+1 912 358 5600 +1 808 544 1600
Significant other logistics deals were done by Maersk, by national and international retailers such as Forever 21,
Accelatrans and Schilli Distribution. Recent construction of Sephora, Victoria’s Secret, Tommy Bahama and Ross. Dis-
the $325 million Mitsubishi Power Systems plant and hiring ney's first Hawaiian resort is under construction in Ko Olina.
announcements from British tractor manufacturer JCB have The 21-acre, 859-room project is projected to create an
been positive. Savannah-headquartered jet maker, Gulf- additional 4,800 jobs and pump more than $300 million into
stream Aerospace, announced a $500 million, 1,000-job Hawaii's economy.
expansion in addition to its recently constructed service and The commuter rail line stretching from Kapolei to Ala Moana
R&D facilities that total over 900,000 SF. is one of Hawaii's biggest hopes for renewed construction
Metropolitan Area Retail continues to follow national trends but local tourism has Metropolitan Area activity. Approximately $1.5 billion is being pledged by the
buffered the blow. Malls have had slight year-to-year sales Federal Transit Administration. The city of Honolulu has
increases and overall sales tax receipts have improved. When already awarded $480 million to a local engineering firm to
2010 re-tooled, the stalled Savannah River Landing development 2010 complete the entire project by 2019. Speculative investors
Population 346,746 holds great promise for retail, hotel, Class-A office and high- Population 913,740 have already begun to invest in and around planned rail
end residential on the riverfront. The historic district has station sites.
Population 372,936 seen retailers come and go but has increased interest from Population 926,513 The sharpest declines in employment occurred in the profes-
national players. Most new retail development occurred in sional, financial and business services sectors. Resultantly,
Employment the Pooler submarket including two new theaters and Edens Employment
offices were downsized leading to negative absorptions. The
Population 158,124 & Avant's Publix center, which opened 93% pre-leased. Population 405,775
state government continues to cut back and consolidate its
Household Limited office leasing produced some moves but no Household office requirements as it struggles with a $1.2 billion budget
Average Income $61,871 net-new users of any significance. GSA build-to-suits drove Average Income $79,655 deficit and diminishing tax base. 2011 will be a boon for
development, including Savannah's first modern-day, Class Asian-based cash investors who will enjoy an unprecedented
Median Median
A building in the CBD. Slated to open in 2012, 70,000 SF Household Income $64,277 opportunity to compete for investment properties during this
will be constructed in the historic district and house the U.S. period of tight capital markets, stringent lending requirements
Total Population 36 Attorney's office on four of its six floors. The two Savannah- Total Population and market uncertainties.
37
Median Age based regional hospitals opened several area medical office Median Age
facilities.
Savannah At A Glance Honolulu At A Glance

Class C $ 14.00 $ 18.00 $ 15.64 7.90% SUBURBAN OFFICE
SUBURBAN OFFICE New Construction (AAA) N/A N/A N/A N/A
New Construction (AAA) N/A N/A N/A N/A Class A (Prime) $ 17.16 $ 18.80 $ 17.98 9.00%
Class A (Prime) $ 16.00 $ 22.00 $ 17.26 15.00% Class B (Secondary) $ 15.25 $ 17.40 $ 16.22 10.30%
Class B (Secondary) $ 12.00 $ 16.00 $ 13.50 15.00% INDUSTRIAL
Class C $ 12.00 $ 16.00 $ 13.50 15.00% Bulk Warehouse $ 10.89 $ 11.65 $ 11.27 4.80%
INDUSTRIAL Manufacturing $ 11.88 $ 12.60 $ 2.04 6.50%
Bulk Warehouse $ 3.50 $ 4.75 $ 3.75 19.50% High Tech/R&D $ 12.36 $ 13.20 $ 12.78 3.80%
Manufacturing $ 4.50 $ 4.50 $ 4.50 N/A RETAIL
High Tech/R&D $ 5.50 $ 12.00 $ 10.00 N/A Downtown $ 51.96 $ 180.00 $ 115.98 6.00%
RETAIL Neighborhood Service Centers $ 35.64 $ 46.68 $ 41.16 2.70%
Downtown $ 18.00 $ 35.00 $ 16.85 6.40% Community Power Center $ 43.68 $ 54.36 $ 49.02 4.80%
Neighborhood Service Centers $ 12.00 $ 24.00 $ 14.58 8.80% Regional Malls $ 32.16 $ 51.48 $ 41.82 0.90%
Community Power Center $ 10.25 $ 25.00 $ 19.00 2.20%
Regional Malls $ 25.00 $ 50.00 $ 35.00 2.50% DEVELOPMENT LAND Low/Acre High/Acre
DEVELOPMENT LAND Low/Acre High/Acre Office in CBD N/A N/A
Office in CBD $ 1,306,800.00 $ 2,831,400.00 Land in Office Parks $ 1,100,000.00 $ 1,550,000.00
Land in Office Parks $ 200,000.00 $ 450,000.00 Land in Industrial Parks $ 953,000.00 $ 1,065,000.00
Land in Industrial Parks $ 150,000.00 $ 250,000.00 Office/Industrial Land - Non-park $ 785,000.00 $ 1,026,000.00
Office/Industrial Land - Non-park $ 30,000.00 $ 200,000.00 Retail/Commercial Land $ 860,200.00 $ 1,280,000.00
Retail/Commercial Land $ 200,000.00 $ 650,000.00 Residential $ 34,900.00 $ 3,750,000.00
Residential $ 15,000.00 $ 25,000.00

Boise, Idaho Southeast (Idaho Falls/Pocatello), Idaho
The commercial real estate market in the Greater Boise The impact of the nationwide recession on real estate in East-
Metropolitan Area continues to rebound from the largest ern Idaho has been felt most heavily in residential sales, con-
drop seen in values and rates from the peak in 2006. struction and land development. However, the overall economy
The unemployment rate has leveled off and is gradually in the region has been buoyed by several factors. Idaho Gov-
decreasing as new jobs are being added. Large dollar highway ernorButch Otter has accurately stated that Idaho boasts a low
projects are helping and should continue through 2011 and cost of living, reliable and inexpensive power, a high quality
2012. work force, a stable tax base, a progressive business climate,
The market’s high-tech sector continues its growth with tremendous natural beauty and a high quality of life.
projects like very large data center farms. Healthcare Eastern Idaho provides an abundance of opportunities for
increases along with alternative energy are also fueling the energy related companies, including commercialization
comeback. Office and retail rates continue to drop from 2009 programs between the Idaho National Lab and private industry
levels, providing opportunities for cash-heavy investors. Office and an increasing number of research parks and incubators.
rates are down 6% to an average rate of $16.09/SF. Retail The Idaho National Lab employs over 7,500 scientists,
rental rates are down 12% to an average rate of $13.42/SF. researchers and support staff. Additionally, Areva's $2.5 to $5
Industrial has turned into a bright spot with stabilized low billion Eagle Rock uranium enrichment facility west of Idaho
rates that have served to decrease inventories. Each sector Falls promises to bring an estimated 1,100-1,200 construc-
Contact has shown success in site-specific locations. Contact tion jobs and 300-400 full-time jobs once completed.
NAI Pinnacle NAI Commerce One Real
Investment is struggling with values that are too high for Idaho ranks in the top five states in the nation in patents per
+1 208 947 0019 Estate, LLC
the risk/reward return, high capital requirements and a con- capita and in manufacturing investment, and also ranks high
+1 208 525 8088
tinually moving financial "strike zone." The few transactions in green job growth. Ridgeline Energy and BP Wind Energy’s
that did take place were user driven. Nampa/Caldwell have wind farm 10 miles east of Idaho Falls is the state’s largest
seen an increase in leasing activity creating a sense of and is now running at full capacity on 11,000 acres with 83
rebounding. Sorrento Lactalis leased 76,538 SF as they GE generators.
continue to invest in Canyon County. Access to low-cost, quality higher education has resulted
Land prices are providing the best long-term anticipated in a well-educated workforce. Pocatello is home to ISU, the
returns due to the 37% drop in an already low land value state’s premier health research university. Boise State
Metropolitan Area compared to similar communities, as well as a springboard Metropolitan Area
University, ISU and University of Idaho all have a presence
to low development and construction costs. Out of state in Idaho Falls through the Center for Advanced Energy
companies continue to seek out Boise/Nampa-Caldwell as Studies (CAES), a public/private research partnership with
2010 the studies verify it to be their secret cost containment plan 2010 the universities, the INL and private industry. BYU-Idaho, a
Population 625,954 for the future. Population 218,238 private university in Rexburg owned by the Church of Jesus
Idaho's low cost power and overall tax structure, along with Christ of Latter-Day Saints, has grown to be the 10th largest
Population 695,210 a high a number of sun days and family friendly activities Population
employer in the state. Full-time enrollment is projected to
236,175
are providing the reason to choose Boise. Boise/Nampa- increase from 12,500 students in 2010 to 15,000 by 2015,
Employment
Caldwell's overall outlook shows a pathway poised to once Employment and the campus boasts a variety of new buildings including
Population 268,832 Population 98,826 a 15,000 seat auditorium.
again begin its climb to be the region’s most sought
Household after market area to do great business, raise families and Household Tourism is another source of economic diversification in the
Average Income $69,827 experience the great outdoors. Average Income $63,396 region; Eastern Idaho is the gateway to two of America’s most
famous national parks, Yellowstone and Grand Teton, and has
Median Median
great access to destinations like Jackson Hole and Sun Valley
and world-class fishing, hiking and skiing.
34
Median Age Median Age 32
Boise At A Glance Idaho Falls/Pocatello At A Glance

Class A (Prime) $ 16.50 $ 21.50 $ 19.25 10.40% Class A (Prime) $ 14.50 $ 16.00 $ 14.00 N/A
Class B (Secondary) $ 15.10 $ 17.25 $ 16.85 9.80% Class B (Secondary) $ 9.00 $ 12.00 $ 10.00 N/A
SUBURBAN OFFICE SUBURBAN OFFICE N/A N/A N/A N/A
Class B (Secondary) $ 6.25 $ 13.75 $ 9.50 19.80% Class B (Secondary)
INDUSTRIAL INDUSTRIAL $ 2.50 $ 6.00 $ 4.25 N/A
Bulk Warehouse $ 2.40 $ 4.85 $ 3.75 10.80% Bulk Warehouse $ 4.00 $ 6.50 $ 5.75 N/A
Manufacturing $ 3.55 $ 6.00 $ 4.85 13.30% Manufacturing $ 5.50 $ 7.00 $ 6.75 N/A
High Tech/R&D $ 4.80 $ 7.26 $ 5.20 11.90% High Tech/R&D
RETAIL RETAIL $ 9.00 $ 12.00 $ 10.00 N/A
Community Power Center $ 12.00 $ 23.00 $ 17.50 10.80% Community Power Center $22.00 $ 38.00 $ 28.00 N/A
Regional Malls $ 15.00 $ 17.50 $ 16.00 9.80% Regional Malls

Office in CBD $ 924,343.00 $ 1,167,408.00 Office in CBD $ 230,000.00 $ 360,000.00

Chicago, Illinois Springfield, Illinois
The third largest metropolitan area in the U.S. after New Springfield, the capitol of Illinois, accounts for approximately
York and Los Angeles, Chicago is the most influential half of the population in the metropolitan areas of Sangamon
economic region between the East and West Coasts. and Menard Counties. Springfield’s major employment
Foreign Policy Magazine recently ranked Chicago sixth sectors are government, medical, public service and small
among world competition when factoring in multiple business. Springfield’s current economy has been impacted
econometrics. Situated at the geographical heart of the similar to that of the national economy; however, funds for
nation, Chicago’s location advantages have fostered its commercial real estate loans are readily available.
development into an international center for banking, Government is the largest employer in the Springfield area.
securities, high technology, air transportation, business The two largest private employers in the region are St. Johns
services, retail trade and manufacturing. Hospital and Memorial Hospital, including SIU School of
The downtown office vacancy rate has been on the rise Medicine. Completed medical developments in 2010 include
for the past two years, but finally leveled off around 17% a 50-bed acute care hospital and an orthopedic medical
during the second half of 2010. Downtown construction facility with rehabilitation services. During 2010 there have
has ground to a halt in 2010, following the delivery of 3.6 been four new satellite medical clinic construction projects
million SF in 2009. New construction and redevelopment either started or completed and a YMCA building incorpo-
projects will remain sidelined until some of the more than rating some medical services within the facility.
Contact 22 million SF of vacant space begins to be steadily Contact
Higher education opportunities include the University of
NAI Hiffman absorbed and demand returns. NAI True
Illinois at Springfield, Southern Illinois University School
+630 932 1234 +1 217 787 2800
The Chicago suburban office market is composed of of Medicine and Lincoln Land Community College. Robert
several scattered pockets of corporate parks and high-rise Morris University and Benedictine University at Springfield
office towers. Suburban vacancy rates, typically higher and are the private colleges in the area.
more volatile than downtown, continued to climb through Retail growth in Springfield is recovering slowly with the
2010, nearing 24% by the end of the year. Sales and leas- anticipated opening of Scheels sporting goods chain sched-
ing activity continues to increase market wide, a sign that uled for June 2011. National chain stores and big-box users
improvement can’t be far off. Landlords continue to offer like Super Wal-Mart, Menards and Gander Mountain have
competitive rental rates and significant concession pack- opened within the past 24 months. Other national chain
ages to attract tenants. stores are continuing to locate in Springfield. Springfield
The second largest industrial market and the most important continues to attract small banks seeking commercial lending
Economic Overview transportation hub in the country, Chicago’s industrial Economic Overview opportunities. Farm land sale prices per acre are at a record
2010 market continued to be challenged during 2010 by limited 2010 high, approaching $8,500 per acre.
Population 9,739,919 demand and an uncertain economy. Vacancy rates peaked Population 207,610
Abraham Lincoln Museum and Library are two prestigious
above 12%, but improved for the first time in two years visitor/tourist attractions in Springfield. Despite the breadth
Population 9,920,929 during the second half of the year. New construction has Population 209,607 of history, culture and recreational opportunities found in
been limited to build-to-suit projects, with little additional Springfield, the cost of living remains low. Springfield has
Employment construction expected until at least 2012. Industrial Employment consistently been one of the most affordable communities
Population 4,238,548 production and trucking and rail volumes continue to show Population 107,449
in Illinois with robust residential sales in 2010. Recreation
positive growth, a sign that demand will increase as more Household opportunities in Springfield are plentiful with over 30 public
Household
Average Income $82,593 product is flowing through the system. The nation’s largest Average Income $65,955 parks offering tennis courts, ice rings and swimming pools.
inland port, the CenterPoint Intermodal Center, announced There are nine public golf courses, two country club golf
Median the much anticipated opening of a new intermodal facility Median
courses, indoor/outdoor theatre venues and a 4,235-acre lake.
Household Income $65,796 that began operations in 2010, now providing intermodal Household Income $54,980
Total Population
service with both the BNSF and Union Pacific Railroads. Total Population
35 40
Chicago At A Glance Springfield At A Glance

RETAIL RETAIL
Downtown $ 22.00 $ 185.00 $ 8.80 N/A Downtown $ 8.00 $ 15.00 $ 11.00 15.00%
Sub Regional Centers $ 10.00 $ 14.00 $ 10.00 N/A Community Power Center N/A N/A N/A N/A
Regional Malls $ 20.00 $ 80.00 $ 8.00 N/A Regional Malls N/A N/A N/A N/A

Office in CBD $ 3,484.800.00 $21,780,000.00 Office in CBD $ 450,000.00 $ 870,000.00
Land in Industrial Parks) $ 120,000.00 $ 520,000.00 Land in Industrial Parks $ 35,000.00 $ 100,000.00
Retail/Commercial Land ) $ 400,000.00 $ 1,000,000.00 Retail/Commercial Land $ 130,000.00 $ 480,000.00

Fort Wayne, Indiana Indianapolis, Indiana
The economic climate in the greater Fort Wayne market has The Indianapolis office market saw positive absorption of
remained constant through 2010 with an unemployment 350,000 SF in Q3 2010 aided, by large government leases
rate in the six-county MSA rising slightly to 10.1%. Fort with The Department of Defense and Internal Revenue Serv-
Wayne continues to revitalize its downtown. A $30 million ice. The office vacancy rates, including medical office product,
baseball stadium, a 900-space parking garage and a $35 decreased to 13.5%. Aggregate average rental rates ended
million Courtyard by Marriott Hotel have been completed, Q3 at $17.51/SF, a slight increase from the previous quarter.
and a $14.5 million residential condominium/retail complex There were no buildings delivered to the market in 2010 with
is expected to break ground in the near future. the development market being limited to build-to-suit projects.
The retail market showed very little improvement in 2010. The bulk warehouse market in Indianapolis continues
The strongest major retail submarkets are on the Dupont to sustain through the downturn in the nation’s economy
and Lima Road corridors in the Northern section of the city markets with a vacancy rate of 12.5%, which is down from
and along Illinois Road in the Southwest section. Orchard 15% last year. The manufacturing market is currently
Crossing, which opened in 2008, continues to be a draw, realizing a 5% vacancy rate, which increased from 3.4%.
with Target and Goodman’s as anchor tenants, along The vacancy rate for mid-sized warehouse space stands at
with 26 other possible occupants. The Maplecrest Road 10.7% and office/flex shows a vacancy rate of 18.7%.
extension, connecting the Northeast residential markets with For the second year in a row, new retail development
Contact New Haven, is expected to be completed by 2012 and Contact
continues to be extremely slow in the Greater Indianapolis
NAI Harding Dahm should lead to future retail development. NAI Global
Area. Two retail buildings totaling 14,225 SF were
+1 260 423 4311 +1 609 945 4000
The industrial market has seen an abundance of larger completed in Q3 2010. This trend continues to put
facilities become vacant while the demand for smaller downward pressure on undeveloped retail ground, which
industrial buildings continues to remain stable. The office has seen a 20-30% decrease in value over the past year.
warehouse market continued to be soft throughout 2010. The one benefit in the lack of new development has been
Vacancy rates in this sector are at 15%. There has been stabilization in existing shopping center rental rates as well
very little construction in this sector over the past year and as a decrease in vacancy rates. National retailers (The
very little is planned for 2011. This will remain the case until Container Store and Nordstrom Rack) have announced their
there are improvements in economic conditions and the first stores in the market and discounters (Shoppers World)
financial markets. have back filled large anchor vacancies.
The office market is stable; however, vacancy rates are still Due to the continued uncertainty of the current economy
high. There is very little construction in the office industry, and lack of financing options for development, there
2010 but the market is experiencing strong growth in medical 2010 is downward pressure on land values. Banks and financial
Population 418,618 office space as Parkview Hospital continues its construction Population 1,755,797 institutions have begun to sell parcels at lower than tradi-
of a new regional medical center in the I-69/Dupont tional market values, thus increasing the uncertainty of
Population 430,641 interchange. Both Parkview and Lutheran Hospitals continue Population 1,854,844 values and the ability to finance projects. We are seeing
to expand with new medical office buildings on their respective improved properties sell at prices lower than replacement
Employment campuses. We project this market will continue to remain Employment cost. Until rents and value approach replacement, we do not
Population 187,997 status quo over the next few years with unemployment Population 808,217 forecast any new velocity in land sales over the next year.
Household
remaining at current levels within the six-county MSA. Household
Median Median

36 36
Fort Wayne At A Glance Indianapolis At A Glance

RETAIL RETAIL

Residential $1 0,000.00 $ 40,000.00 Residential $ 17,500.00 $ 80,000.00

Cedar Rapids/Iowa City, Iowa Davenport/Bettendorf,Iowa and Rock Island/Moline, Illinois
The Eastern Iowa Corridor (Iowa City to Cedar Rapids to The Quad Cities--Davenport, Bettendorf, Moline and Rock
Waterloo/Cedar Falls) continues to rebuild after the devas- Island--the four cities bordering the Mississippi River,
tating floods of 2008. Numerous projects are under way or continue to be a vibrant community in which to do business.
starting to replace Federal, State, County and Municipal The area’s largest employer, the Rock Island Arsenal,
buildings that were destroyed. The projects, which will total continues to add jobs while other larger employers are
over $1 billion in value, will be ongoing over the next 10 to reducing their labor force by modest amounts.
15 years, giving a measure of stability to the area. While there is a slight oversupply of office space, landlords are
Class A office rental and vacancy rates have been a bright holding steady in their asking rates. This has caused landlords
spot in 2010. Vacancy rates are under 6% and lease rates and tenants to become savvier in lease negotiations, resulting
have edged up to $13.00 to $16.00/SF. Some of this is due in leases that include rental abatement, rental rates to be
to municipal offices occupying space after the floods, but it increased over time, more tenant improvements paid for by
has also been helped by a lack of new projects coming on property owners and shorter lease terms.
the market over the past two years. Class B space in the Although retail has been challenged nationally, the Quad
$10.00 to $11.00/SF range is experiencing more vacancy, Cities has not seen the large run of closings that other areas
sliding into the 18-20% range, along with Class C space, have experienced. The Quad City area, with over 375,000
which is showing about the same vacancy and rental rates people, has remained attractive to retailers. Industrial real
Contact of $6.50 to $8.50/SF. Contact
estate activity began slowing down in the second half of
NAI Iowa Realty NAI Ruhl & Ruhl
The Retail market has begun to pick up in the Corridor area. 2008. The slowdown continued into Q1 2009 as local area
Commercial Commercial Company
Three new big box stores, one in Iowa City/Coralville, one in manufacturers began laying off employees and putting
+1 319 363 2337 +1 563 355 4000
Cedar Rapids and one in Waterloo have added over 350,000 expansion plans on hold. There was brisk activity through
SF of new retail space to the area. Smaller space strip 2008 and into 2009 from wind power manufacturers and
centers remain at a higher vacancy (15% plus) with eroding logistics providers. Numerous prospects from many countries
rents $10.50/SF, but major retail developments have visited the Quad Cities area to view existing manufacturing
remained strong. facilities, greenfield sites for new factories and storage sites.
The Industrial/Warehouse market has a number of oppor- Metropolitan Area The first three quarters of 2010 have shown modest
tunities to refit existing facilities for heavy manufacturing, Economic Overview improvement. Office and retail activity have improved. Industrial
Metropolitan Area cross dock warehousing and general high bay warehousing. is showing signs of life. The land segment has been very
Average vacancy is about 8% in the Cedar Rapids area with 2010 quiet with the exception of opportunistic deals. We are seeing
Economic Overview Population 380,829
rates averaging $5.28/SF. Larger spaces are offering some more contract sales, lease options, SBA financing and very
2010 very attractive rates in the low to mid $2.00/SF range. 2015 Estimated
few conventional financed deals. The Quad Cities has had
Population 414,261
The investment market has held up very well, with a general Population 384,010 slower but steady growth over the years. Employment, hous-
lack of good properties available. The steady economy of ing and commercial development is not as oversupplied as
2015 Estimated Employment
Population 440,200 the area and state in general have made investment very many of the markets that experienced more growth before the
Population 186,916
attractive and new properties coming to market of invest- recession. This has been a very positive influence to the area’s
Employment
ment grade are few. Steady growth and opportunities are Household more stable housing and commercial real estate values.
Population 220,316 $61,058
the strength of the Eastern Iowa Real Estate Market in 2010 Average Income
Household and into 2011 and beyond. Median
Median
Total Population
Household Income $55,578 39
Median Age
Total Population
35
Median Age
Cedar Rapids At A Glance Davenport/Bettendorf, Iowa and Rock Island/Moline, Illinois At A Glance
Premium (AAA) N/A N/A N/A N/A New Construction (AAA) N/A N/A N/A N/A
RETAIL RETAIL
Sub Regional Centers $ 10.00 $ 22.00 $ 14.00 15.00% Community Power Center $ 4.00 $ 12.00 $ 6.00 10.00%

Office/Industrial Land - Non-park $ 40,000.00 $ 160,000.00 Office/Industrial Land - Non-park $ 43,560.00 $108,900.00

Des Moines, Iowa Sioux City, Iowa
Des Moines’ growth for the past 20 years has been closely Site Selection magazine ranked the tri-state Sioux City area
tied to the insurance and finance industries. Therefore, the #1 nationally in economic activity among metro areas under
recent softness in those same industries has had a more pro- 200,000 people in 2007 and 2008, and #2 in 2009. Strong
nounced effect on our market. While our unemployment rate development activity in the agricultural and food processing
(6.7%) remains well below the national average, the quality of sectors are responsible for the high ranking. The metropolitan
the jobs that have been trimmed has had a larger impact on area includes Sioux City, Iowa; South Sioux City, Nebraska;
our local consumer base than the loss of entry level positions. and North Sioux City, South Dakota.
In addition, the aggressive nature of the local lenders over the The industrial market totals 15.3 million SF with a favorable
past three years has caused an upsurge in receiverships and 7.5% vacancy rate and modest new construction. Work is
foreclosure activity, consistent with the national market. The under way on a $400 million expansion by Beef Products,
downtown area continues to struggle due to corporate relocation Inc. in South Sioux City, which is the largest single investment
into owned facilities and some migration of tenants to suburban ever made in Nebraska. The most significant industrial news
locations. Iowa companies moving into their new headquarters is a proposed $10 billion, 400,000 barrel oil refinery planned
through 2010 will vacate approximately 1.2 million square feet. by Hyperion Resources of Dallas that would be the second
Downtown office vacancies vary dramatically from property to largest construction project in the history of the United
property. Some of the vacancies are in some of the nicer office States. The company has renewed options on over 4,700
Contact buildings and have opened up larger blocks of Class A space. Contact acres; a county referendum approved zoning for the project
NAI Ruhl & Ruhl We expect to see rental concessions and renegotiations of NAI LeGrand & Company and construction could begin by the end of 2011.
Commercial Company current leases into 2011 while some tenants take advantage +1 712 277 1070
Sioux City is the dominant retail center in the region with 6.1
+1 515 309 4002 of the opportunity to upgrade their space. million SF of space. Retail sales have steadily increased due
Overall industrial occupancy remained stable with limited new to a large amount of new space coming online that effectively
construction in the sector. Some buildings that had been increased the trade area, but it was only a matter of time
converted to open floor plate; cheap office space may come until overbuilding outpaced demand. Many properties have
back to the original industrial use. The flex market continues experienced rising vacancy rates and falling rents, creating
to see some softness. a favorable market for tenants.
We’re starting to see some renewed activity in the retail sector. The office market consists of 5.6 million SF, and has main-
Metropolitan Area As economic conditions improve landlord’s focus has shifted Metropolitan Area
tained a split personality. The professional sector remains
from retaining existing tenants to attracting new ones. National weak due to the lack of white collar job growth, while the
retailers are back in the mode of talking about the future medical market is robust. Medical space has accounted for
2010 expansion. Retail activity in the western suburbs continues to 2010 half of all office construction since 2000. The Dakota Dunes
Population 574,520 be focused around General Growth’s Jordan Creek Town Population 144,026 submarket thrives with just a 2.8% vacancy rate, the highest
Center highlighted by the recent opening of the first Trader rents in the region and more space under construction.
Population 626,263 Joe’s in the state. A new 174-acre open air lifestyle center lo- Population 143,956 The Sioux City area will experience an unprecedented
cated east of Des Moines in Altoona, The Shoppes at Prairie economic boom if the Hyperion Energy Center goes forward.
Employment Crossing will consist of up to 1.4 million SF of retail space Employment A research study estimates the project would result in
Population 293,011 when complete, anchored by Bass Pro Shops. Other retailers Population 71,194
14,000 new jobs and add $14 billion in annual economic
Household
expanding in the Des Moines market include Olive Garden and activity to the local market.
Household
Average Income $71,806 Buffalo Wild Wings. Average Income $60,760
Median Median

36 36
Des Moines At A Glance Sioux City At A Glance

New Construction (AAA) $ 12.75 $ 16.50 N/A N/A New Construction (AAA) $ 15.00 $ 20.00 $ 16.50 15.00%
Bulk Warehouse $ 2.50 $ 5.00 N/A 6.60% Bulk Warehouse $ 1.50 $ 5.25 $ 3.75 10.00%
Manufacturing $ 1.50 $ 7.00 N/A 8.20% Manufacturing $ 1.50 $ 3.50 $ 3.00 4.00%
High Tech/R&D $ 3.00 $ 10.80 N/A 6.50% High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 3.00 $ 20.00 N/A 12.7.0% Downtown $ 5.00 $ 12.00 $ 10.00 32.00%
Neighborhood Service Centers $ 5.00 $ 15.00 N/A 14.00% Neighborhood Service Centers $ 8.00 $ 18.50 $ 13.00 10.00%
Community Power Center $ 6.00 $ 20.00 N/A 16.00% Community Power Center $ 10.00 $ 22.00 $ 16.00 11.00%
Regional Malls $ 13.00 $ 23.00 N/A 10.40% Regional Malls $ 20.00 $ 40.00 $ 30.00 7.50%
%

Wichita, Kansas Lexington, Kentucky
The national economic downturn has affected the Wichita Lexington and Central Kentucky’s commercial real estate
area, increasing the area unemployment to 8.2%. Although markets have experienced increased activity in several
depressed, the aerospace manufacturing industry is still the market segments. Retail vacancy has declined below 9%
major contributor to the local economy. The $5.2 billion salary and rates have stabilized. Single tenant, owner occupied
of this workforce represents 25% of the Kansas economy. property sales have rebounded significantly in 2010. The
The second largest industry sector is education and health suburban and central business district office markets
services. Despite the economy, this sector is healthy and continue to deal with slow absorption and tenant caution,
continues to grow, adding over 500 jobs in 2010. but lack of new construction should help boost the office
The office market remains relatively steady with minimal market occupancy in 2011.
new construction as demand for new space is soft. The The suburban and CBD office markets have been the slowest
warehouse and manufacturing market has softened, largely to recover but absorption increased. Added to a reduction
due to condition of the aircraft industry. Since nominal in new construction and an improving economy, both office
taxable retail sales decreased 5.5% in 2009, the market for markets will continue to improve over the next several
retail space has been affected. This trend is expected to months and return to previous occupancy levels.
stabilize in 2011, causing retail vacancy rates to improve. Retail rates stabilized and overall vacancy decreased due to
The investment market remains quiet and construction of little new construction and the market not being overbuilt.
Contact speculative space is on hold. The hospitality sector is stable, Contact
As the right opportunities become available regional and
NAI John T. Arnold particularly in the downtown area where Drury Inns is NAI Isaac
national retailers are opening a limited number of stores and
Associates, Inc. investing $28 million in the new Drury Plaza Broadview Hotel, +1 859 224 2000
local start-up retailers are becoming more active.
+1 316 263 7242 and where Marriott Fairfield Inn & Suites is constructing 130
new rooms in the WaterWalk development. Lexington’s industrial market has been stable, but leasing
and sales activity slowed. Most current activity is in the repo-
Sales of commercial property due to bank foreclosures are sitioning of existing operations and the leasing of smaller
not yet significant. This is largely due to long-term stability facilities, flex and R&D space. The industrial market will
in lease rates and property values. However, sales of devel- remain stable in 2011 with absorption gradually increasing.
opment land for new projects are down significantly and
values are down by 5-10%. The investment market has been more active. Nationwide
demand for single-tenant, net leased investments has
Metropolitan Area The State of Kansas and particularly the Wichita area are Metropolitan Area encouraged investors from outside the area to enter the
poised to diversify the economy through wind energy-related market. Local investors have increased their activity level
manufacturing. In 2010, Siemens Energy built a 300,000 for single-tenant investments as well. Multifamily projects
2010 SF turbine nacelle production facility and a 90,000 SF facility 2010
were quiet in 2010 after many new complexes came on the
Population 611,470 for repair operations. Tindall Corporation has purchased Population 466,177
market in 2009. The only new construction has been in
property to develop a facility for the construction of concrete completing the final phases of projects started last year.
Population 633,210 tower bases. Due to the natural wind resource and central Population 495,422 Vacancy rates decreased, and 2011 should see an increase
location, other related manufacturers are expected to follow. in new development.
Employment In general, the Wichita market is expected is remain stable Employment
Population 277,450 overall through 2011, and experience growth again in 2012. Population 247,455 Commercially zoned land is in short supply and re-zoning
from residential to commercial use is difficult in Lexington.
Household Household
$63,540 $66,624
Adaptive re-use of existing sites is encouraged throughout
the city. Lexington’s unique position as a retail, service,
Median Median education, entertainment, employment and medical hub for
Household Income $54,702 Household Income $53,901 central, southern and eastern Kentucky continues to propel
Lexington as an attractive location for all types of businesses
36 Median Age
36 and developments.
Median Age
Wichita At A Glance Lexington At A Glance

Manufacturing $ 3.50 $ 5.00 $ 4.25 10.00% Manufacturing $ 3.75 $ 5.00 N/A 19.40%
High Tech/R&D $ 5.00 $ 8.00 $ 6.50 5.60% High Tech/R&D $ 7.00 $ 15.00 N/A 5.60%
RETAIL RETAIL
Downtown $ 6.00 $ 12.00 $ 10.00 12.60% Downtown $ 10.00 $ 19.00 N/A 24.30%
Neighborhood Service Centers $ 8.00 $ 12.00 $ 10.00 9.00% Neighborhood Service Centers $ 10.00 $ 20.00 N/A 11.80%
Community Power Center $ 12.00 $ 22.00 $ 15.00 6.00% Community Power Center $ 15.00 $ 26.00 N/A 8.30%
Regional Malls N/A N/A N/A N/A Regional Malls $ 30.00 $ 65.00 N/A N/A


Louisville, Kentucky Baton Rouge, Louisiana
Air delivery and freight services and healthcare lead the The Capital Area has performed a notch ahead of the
Louisville economy with three Fortune 500 companies making national averages through the recession, although South
major commitments in Louisville. United Parcel Service, with Louisiana began to feel the effects nearly one to two quarters
its international air hub in Louisville, announced a $1 billion later than the rest of the country. Slower growth from 2003-
expansion of WorldPort, its sorting facility located at Louisville 2007, a strong medical presence combined with the LSU
International Airport. Humana, a healthcare company, system and local governmental activity kept Baton Rouge
announced a 1,100-job expansion and expanded its down- from becoming a major casualty of the recession.
town headquarters. Kindred spun off a new pharmaceutical The office sector may have taken the hardest hit in 2010.
company, merging with PharMerica LongTerm Care to create For the first time since 2005 citywide occupancies fell below
PharMerica Corp. 84%, which is 4% lower than the prior year. A glut of
The office market ended Q3 2010 with a vacancy rate of sublease space and motivated landlords have made the
12.1%, a net total absorption of negative 102,028 SF and office sector very tenant friendly, although a recent increase
an average rental rate of $15.96/SF. Only 22,240 square in medical office and general office activity may show early
feet were delivered to the market in two new buildings signs of private sector growth.
with 3,838 under construction at quarter's end. Norton The Capital Area retail sector is made up of roughly 8 million
Healthcare leased 41,496 SF in Watterson Tower making it SF of inventory. Overall vacancies in 2010 slipped to 12.5%
Contact the largest deal. Contact
up, from 11.5% in 2009. Virtually no new big box develop-
NAI Walter Wagner, Jr. NAI Latter & Blum
The retail market remained steady with a vacancy rate of ments broke ground with one redevelopment taking place
Company Realtors, LLC +1 225 295 0800
9% at Q3 2010 on negative net absorption of 59,122 SF. near LSU. High-end retailers suffered the most while bargain
+1 502 562 9200
Rental rates averaged $11.16/SF. One building with 21,234 concepts expanded fairly aggressively.
SF of retail space was delivered to the market with 155,228 Industrial vacancies remained relatively flat in 2010 with
SF of retail space under construction at the end of the some additional inventory coming online that reversed what
quarter. Funke People leased 22,891 SF in Jefferson Mall would have been a positive absorption year. Overall inventory
for the largest deal. for the Capital Region is roughly 25 million SF.
The industrial market ended Q3 with a vacancy rate of 12.9% Apartment occupancies remained fairly strong in 2010 with
on negative net absorption of 558,273 square feet and an a slight dip in Class A buildings during Q2 and Q3 2010.
Metropolitan Area average rental rate of $3.52/SF. Only 15,000 SF were deliv- Metropolitan Area Citywide vacancies held at 7% with no noticeable rental
ered to the market with no new buildings under construction. increases in 2010 compared to 1-2% the previous five
Dana Drive Shaft leased 83,350 SF in Westport Distribution years. Baton Rouge, along with the Gulf South overall, seems
2010 for the largest deal. 2010 to have weathered the recession fairly well thus far when
Population 1,273,611 Population 789,682
A new downtown multi-purpose arena costing $252 million compared to the national averages. A large factor going
2015 Estimated opened in October 2010, and the $465 million Museum 2015 Estimated forward will be whether the region will sustain the same
Population 1,323,841 Plaza, which will be the tallest building in Louisville, with a Population 827,575 historic population growth fueling development and services
contemporary arts center, condominiums, lofts, a hotel, and in the region. All in all, Baton Rouge is well positioned for
561,567
office space is back on track for construction. Louisville is 345,716
the future.
expanding its extensive park system, adding 4,000 acres of
Household new parks and a 100-mile hiking and biking trail encircling Household
Average Income $66,505 the city. It's one of the largest urban parks expansion Average Income $54,544
projects in the nation.
Median Median

39 34
Louisville At A Glance Baton Rouge At A Glance

RETAIL RETAIL

Office in CBD $ 500,000.00 $ 1,000,000.00 Office in CBD $ 900,000.00 $ 1,750,000.00
Retail/Commercial Land) $ 150,000.00 $ 1,000,000.00 Retail/Commercial Land $ 350,000.00 $ 1,250,000.00

Monroe, Louisiana New Orleans, Louisiana
The commercial real estate market for the Northeast 2010 has been an exciting year in New Orleans as the city
Louisiana Region has continued to hold steady through continues it resurgence after the catastrophic levee
the tough economic times being experienced throughout failures of 2005. A combination of new developments, a
the country. Overall commercial transaction numbers as unique local culture and a reviving tourism market have
well as transaction volume has increased over 2009 without kept the city somewhat insulated from the economic prob-
experiencing a notable drop in property values or in lease lems that have surfaced nationally.
rates. The State and the VA have begun the process of building
The economic development efforts of 2009 and early their conjoined hospitals in the BioSciences District near the
2010 have started to show the results of the momentous Central Business District, where a $2 billion-plus investment
business development projects for key industry sectors will also provide a wet lab and research facilities. On the
and are beginning to pay dividends in the economy of Westbank, the consolidated military command at Federal
Northeast Louisiana. When these projects begin operation City represents another $1 billion in investment and con-
they will create job opportunities, both direct and indirect struction activity that will revitalize a neighborhood and
jobs, for the region that will enable the economy to change the standard for smaller military bases around the
continue to prosper and grow. country. The much publicized post-hurricane Katrina charter
The most recent annual Louisiana Economic Outlook school system has reconfigured our public education for
Contact Contact the better.
report produced by Louisiana State University College of
NAI Faulk & Foster NAI Latter & Blum
Business indicated that Monroe is poised for job growth The office market remains resilient and stable, with down-
+1 318 807 4666 +1 504 569 9300
in both 2011 as well as in 2012. This is a direct result of town Class A office offices roughly 89% leased at rates of
the economic development successes of 2009 and early $17-20/SF. The suburban market is at 90.6% occupancy,
2010. This is very welcome news for the region as from with rates of $22-24/SF. On the industrial side, there are
2004 to 2008 the area lost three major employers, which currently almost 6.4 million SF available, which is to say that
resulted in significant loss of jobs in the region. The report the demand of the post-Katrina 2006 boom has abated.
forecasts that Monroe will be the fifth fastest growing Retail has been caught in the downturn being experienced
metro area in the state in 2011-2012. nationally, but there are more than a few national tenants
The area could be among the fastest growing in the state shopping around for space. Dick's Sporting Goods and
Metropolitan Area if Next Autoworks (formerly V-Vehicle) is successful in Metropolitan Area Kohl's Department Stores recently announced their first
securing a loan from the U.S. Department of Energy. If Next New Orleans-area stores. The area's multifamily market
Autoworks is successful in securing the loan it will start the has strengthened somewhat over the past year and now
2010 construction of the proposed new Next Autoworks Plant, 2010 stands at 90% occupancy.
Population 174,353 which upon completion, would add 1,400 additional jobs to Population 1,187,772
According to Smith Travel's numbers for the month of
the region. Continued growth in the Northeast Louisiana August 2010 compared to the month of August 2009, New
Population 176,320 Region through economic development efforts, creation of Population 1,291,994 Orleans posted a RevPar (revenue per available room)
jobs and capital investment will continue to drive new real increase of 23%, the largest in the country. Year-to-date
Employment estate expansion and development opportunities. Employment
results for 2010 compared to 2009 indicate that New
Population 74,153 Population 483,901
Orleans ranked second in the nation. New Orleans ranked
Household Household first for growth among the top 25 U.S. destinations in hotel
Average Income $48,091 Average Income $55,788 performance for January-May 2010. The housing market
is improving as interest rates are at a 51 year low.
Median Median

37
Monroe At A Glance New Orleans At A Glance

Class B (Secondary) $ 12.00 $ 15.00 $ 13.50 N/A Class B (Secondary) $ 13.75 $ 16.50 $ 15.25 18.30%
Class A (Prime) $ 17.00 $ 22.00 $ 19.50 N/A Class A (Prime) $ 22.00 $ 24.00 $ 22.33 9.40%
Bulk Warehouse $ 2.50 $ 4.50 $ 3.50 N/A Bulk Warehouse $ 2.00 $ 3.75 $ 2.90 13.20%
RETAIL RETAIL
Sub Regional Centers $ 12.00 $ 18.00 $ 15.00 N/A Sub Regional Centers $ 15.00 $ 30.00 $ 22.00 10.00%


Greater Portland (Southern), Maine Baltimore, Maryland
Southern Maine's hub is the City of Portland. It is the largest Greater Baltimore’s commercial real estate market may have
city in the State and is considered to be its social and moved beyond its “bottom,” but remains fundamentally chal-
economic capital because the city contains Maine's largest lenged. Among the challenges is nearly $2 billion worth
port and represents the largest population. Most national of commercial properties that have been foreclosed or are
financial service organizations such as Bank of America, Key carrying significant maturing debt, up from $1.8 billion in
Bank, Fidelity Investments, Anthem Blue Cross & Blue 2009. There have been some encouraging signs of growth.
Shield, TD Bank and Unum base their Maine operations in The U.S. Defense Department’s BRAC plan is assisting some
Portland. suburban markets and downtown Baltimore has seen three
Over the past several months we have seen a slight increase major deals go through in the past year.
in activity in the Greater Portland office market. The current Baltimore’s CBD continues to suffer with a vacancy rate
vacancy rate has leveled off at about 10%. Most of the slightly higher than it was in 2009. Big office deals down-
current increase in leasing activity is attributed to tenants town included Transamerica Life Insurance Co. with a
taking advantage of renewal concessions being offered by 10-year, 145,000 SF lease deal at 100 Light St. The law
their current landlords or tenants looking for better deals firm Ober Kaler also acquired more than 94,000 SF at that
than their landlord will offer. building and accounting firm McGladrey signed a 10-year,
Retail activity currently stands at one of its lowest levels 38,500 SF lease at the new Legg Mason Tower at Harbor
Contact Contact East.
in decades. However, the retail market may be starting
NAI The Dunham Group NAI KLNB, LLC
to unthaw. The stock market run-up, combined with stronger Across the suburbs, the vacancy rates were a bit better,
+1 207 733 7100 +1 410 321 0100
retail sales numbers in March, may be a sign that consumers though still far from strong; 13.6% in Anne Arundel County,
are beginning to spend more. National retailersare generally 11.6% in Baltimore County and 14.9% in Howard County.
taking a “wait and see” approach before committing to new With vacancy rates so high, tenants continue to have the
stores. Companies like Marden’s, Chapter 11 and Goodwill upper hand, using that power to trade up for better space
have taken advantage of boxes vacated by large national and taking advantage of some desperate landlords.
chains. The spaces they’re leaving behind are not being backfilled.
In January 2010, the industrial market began to improve as Asking rates have not increased, meaning the abundance
we received more inquiries on listings and questions about of available space is keeping leasing rates low. The market
the state of the market. Our sense is that we were near the seems to be bouncing along the bottom despite the fact that
Metropolitan Area Metropolitan Area the Baltimore region has been offered a major boost by the
bottom of an extended industrial real estate trough, and
Economic Overview Economic Overview Defense Department’s BRAC plan, which has pumped
users realized they had deferred long enough. Properties
2010 are being leased at historically low market rates. As the 2010
billions of dollars in government money and thousands of
Population 524,531 public becomes more optimistic that we are crawling out of Population 2,699,667 jobs into the Baltimore-Washington corridor.
this deep recession, industrial inventory will slowly be ab- The Baltimore retail market did not experience much change
Population 530,867 sorbed creating a tightening supply that should push lease Population 2,735,043 in market conditions from 2009 to 2010. A total of 1.2
and sale prices upward. million SF of retail was under construction at the end of Q3
Employment
In summary, activity is picking up, decision-makers are eval- Employment 2010. The largest lease signings occurring in 2010
Population 278,428 Population 1,250,673 included: the 197,345 SF lease signed by Forever 21 at
uating new space options and the industrial inventory is
Household slowly being absorbed. This should create upward pressure Household
Former Boscov’s, the 85,100 SF deal signed by ShopRite
Average Income $67,916 on lease rates and sale prices. It’s a great time for tenants Average Income $78,476 at Chesapeake Square Shopping Center and the 63,062 SF
and buyers to look at the market and make a move. lease signed by Toys ‘R’ Us at 6100 Dobbin Rd.
Median Median

41 39
Greater Portland At A Glance Baltimore At A Glance

New Construction (AAA) $ 16.00 $ 21.00 $ 20.25 5.00% New Construction (AAA) $ 28.00 $ 38.00 $ 30.00 N/A
RETAIL RETAIL
Community Power Center $ 8.00 $ 20.00 $ 16.00 5.00% Community Power Center $ 10.00 $ 16.00 $ 15.00 N/A

Land in Industrial Parks $ 100,000.00 $ 150,000.00 Land in Industrial Parks $ 100,000.00 $ 1,350,000.00
101 2011 Global Market Report n www.naiglobal.com 101

Suburban Maryland Boston, Massachusetts
Suburban Maryland is comprised of two primary counties and Boston is faring better than many large cities in the U.S. The
three secondary counties: Prince George’s and Montgomery market continues to attract start-ups and industry leading
counties have the largest populations and surround Washington, companies looking to tap into the wealth of highly educated
D.C.; Calvert, Charles and St. Mary's counties are south of individuals within the technology, finance and healthcare
Prince George’s. Overall the markets for office, industrial, retail industries. The question of when the market will see real
and land sales for these areas have remained relatively job growth (locally and nationally) remains elusive. The econ-
consistent, which directly correlates to the resilience of the omy, while in recovery, does not appear to be on the threshold
Federal Government during slow economic times. of dramatic employment growth or increases in consumer and
Office rental rates in Prince George's County have decreased business spending.
in new construction and Class A space; however, the rates for The downward velocity in the office market appears to be
Class B buildings have remained steady. Expectations are high slowing. Vacancy increased and rents decreased throughout
as the Air Force Headquarters building finishes construction 2010, but the changes were less profound than in 2009.
at Joint Base Andrews in the hopes that contractors will An office market survey measured approximately 200
begin to lease office off base. In addition, there are several million SF in metro Boston. The vacancy rate was 14.1%
proposed office sites surrounding mass transit that are slated and the average Class A rent was $32/SF. A significant
for construction in 2011 and 2012. transaction was Bain Capital's move into the John Hancock
Contact Contact Tower. The private investment firm signed a 15-year lease
The Industrial Market in the North County has seen growth in
NAI Michael NAI Hunneman for 210,000 SF. In the suburbs, the largest transaction saw
product and some landlords are now offering rental rates for
+1 301 459 4400 +1 617 457 3400 Dassault Systèmes take 320,000 SF at 175 and 185
bulk warehouses far below traditional market rates to entice
firms to enter from out of the county and state. Retail has Wyman St. in Waltham.
remained slow throughout 2010; however, there is new The metropolitan Boston industrial market includes 180 million
construction of several million SF expected to be completed SF. The overall vacancy rate is 10.3%. The average rent
in 2011 and 2012 immediately surrounding the Capital remains in the mid to high $5/SF range. The market has
Beltway. Retail has remained at low vacancy rates due to the been slowed by the recession, but has not seen the dramatic
highly dense communities; however, new leases are being rise in vacancy experienced in the office market. HD Supply,
offered at lower rental rates. Residential development in the a wholesale distribution company, recently leased 152,290
county softened during 2010 with only a slight increase seen SF at Boston Business Park in Dedham.
Metropolitan Area in Q1 2010. Metropolitan Area
Investment sales continue to be slow in 2010. Sales volume,
Montgomery County has remained stable in office rental rates average sales price and price per SF have been trending
2010 and vacancy throughout the year and had a limited supply of 2010 downward. Inversely, cap rates have risen and are anywhere
Population 2,265,491 office buildings for sale. The industrial sections of the county, Population 4,568,927 from 100 to 300 basis points higher than their peak values
which are mostly in Silver Spring and Gaithersburg, have sim- in early 2007. Cap rates will range depending on location,
Population 2,309,012 ilarly retained both rental rates and vacancy rates due to the Population 4,637,752 credit quality, length of the leases and product type. Long-
low amount of inventory. Gaithersburg especially has stayed term, single-tenant NNN leases to credit tenants are still
Employment solid in industrial and office through 2010 due to the antici- Employment achieving the lowest cap rates. A significant investment sale
Population 1,119,376 pated opening of segments of the Inter County Connector at Population 2,233,659 was the $96.8 million price paid by AEW Capital for One
Household
I-270 located only a few miles from its major industrial park. Household
Brigham Circle in Boston. The trophy property was 98%
Average Income $97,350 Average Income $97,315 leased with credit tenants and sold for a reported 6.4%
cap rate.
Median Median

37 38
Suburban Maryland At A Glance Boston At A Glance

New Construction (AAA) N/A N/A N/A N/A Premium (AAA) $ 46.00 $ 63.00 $ 50.00 8.00%
Class B (Secondary) $ 7.20 $43.83 $ 22.35 13.00% Class B (Secondary) $ 16.00 $ 23.00 $ 20.00 14.60%
Bulk Warehouse $ 3.50 $ 22.00 $ 7.11 13.00% Bulk Warehouse $ 4.65 $ 7.97 $ 5.73 11.00
Manufacturing $ 5.95 $ 10.00 $ 7.76 7.00% Manufacturing $ 5.15 $ 8.50 $ 6.00 11.90
High Tech/R&D $ 8.50 $ 12.00 $ 11.13 15.00% High Tech/R&D $ 6.40 $ 15.99 $ 9.23 14.40
RETAIL RETAIL

Office in CBD N/A N/A Office in CBD N/A N/A

Greater Springfield (Western), Massachusetts Detroit, Michigan
The Greater Springfield area continued to remain in a slump The Detroit market continues to suffer due to the slow
in 2010 with little or no absorption in the office and retail recovery of automotive and manufacturing sectors which
market. There is an increasing amount of industrial space make up the base of local employment. Positive signs stem-
available as a result of businesses that are still reluctant ming from automotive research, housing affordability and
to make any plans for expansion due to the current and an influx of startup industries are having a positive impact
unexpected future economic conditions. on the market. Vacancy rates appear to have stabilized and
Most of the activity in the office sector remains tenants “trading are showing signs of strength. The retail sector is showing
up” to better space. Retail activity was concentrated in Class signs of life with many value stores positioned to expand
B locations. In today’s market, typical office and industrial deals or relocate.
are taking longer to put together because tenants who control In the office market, the lack of leasing activity is driving
the deals appear to be taking their time during negotiation, further rate reductions and forcing additional concessions
attempting to get every possible concession. These deals to attract tenants, a benefit to tenants who are in the
apply to tenants that are acquiring new space, expanding position to expand their business or hope to upgrade their
to larger properties or renegotiating existing lease renewals. space. There are a variety of bright spots in the market com-
Concessions to these tenants include extended periods of ing from the Detroit CBD. The relocation of Rock Financial
free rent, increase in tenant build-out allowance, parking and Blue Cross Blue Shield were significant announcements
Contact allowances and moving expenses. As a result of these Contact which arrived in the Q3 of 2010. In addition there is wide-
NAI Samuel D. Plotkin concessions, the vacancy rate in Class A office buildings in NAI Farbman spread talk that Mike Ilitch may be developing a joint Pistons
Associates the downtown area is decreasing. +1 248 353 0500 and Red Wings stadium downtown if his attempt to acquire
+1 413 781 8000 the Detroit Pistons franchise is successful.
The Massachusetts Development Finance Agency completed
the purchase of the former Federal Building located at 1550 For the first time since the beginning of 2008 the industrial
Main Street in downtown Springfield. It is now home of the market has shown positive net absorption (1 million SF),
Springfield School Department and will soon house a program furthering the case that stability has returned. Wayne and
for Baystate Health Systems. Oakland counties have aggressively leveraged Michigan’s
The Western Massachusetts industrial market remains flat, infrastructure and industrial labor force which has helped
and as a result there continues to be an oversupply of retain industrial tenancy. Large investments in alternative
industrial space as manufacturers continue to restructure energy and “green” engineering have recently shown
Metropolitan Area Metropolitan Area increased velocity with the signing of A123 Systems, the
and downsize. The industrial market vacancy in the area has
Economic Overview Economic Overview largest lithium ion battery plant in the world.
increased from approximately 12% to 16% and has resulted
2010 in the average lease rates decreasing from approximately 2010 In the investment market, REO properties and distressed
Population 691,379 $3.75/SF to $3.50/SF. With the focus on high-technology Population 4,473,111 notes are attracting investors as they seek opportunistic
and research, the City of Holyoke will be the site of a planned investment opportunities. It will continue to be a buyers’
690,468
$168 million Massachusetts Green High-Performance Population 4,418,392 market through 2012, as more maturity defaults occur and
Population
Computing Center. The center is collaboration between the landlords continue to falter under stressed economic
Employment Commonwealth of Massachusetts, the state’s top research Employment conditions. Detroit multi-family assets are finding renewed
Population 306,362 universities and Cisco Systems. Holyoke was chosen as the Population 1,734,347 demand from local investors and national investors as the
site for the computing center primarily because of its low Household
market for these assets begins to attract value buyers look-
Household
Average Income $64,674 energy costs and cooling powers. Average Income $76,734 ing for a nationally competitive cost basis. Detroit and
the outlying suburbs offer a unique opportunity to acquire
Median Median performing multifamily assets at a deep discount.

38 38
Greater Springfield At A Glance Detroit At A Glance

New Construction (AAA) $ 18.50 $ 22.50 $ 20.50 10.00% New Construction (AAA) $1 5.65 $ 33.89 $ 27.55 61.00%
RETAIL RETAIL

Retail/Commercial Land $ 100,000.00 $ 1,000,000.00 Retail/Commercial Land $ 19,598.00 $ 6,300,000.00

Grand Rapids, Michigan Lansing, Michigan
While Michigan’s economy continues to make negative The greater Lansing area is comprised of Ingham, Eaton and
national news, the West Michigan economy has performed Clinton counties and has a population of approximately
at a higher level. In general, vacancy rates are stable and 450,000 people. While market conditions show signs of
rents are down. Sale and lease prices are being driven recovery with increased leasing activity, we continue to see
downward by the market absorbing the influx of bank- the investment and development markets dry up, mostly due
owned real estate. The region continues its aggressive push to the lack of available credit and the overabundance of
to be a regional provider of medical care and education in inventory in all market segments. Unemployment went from
the health services industry. a low of 5.4% in 2007 to a high of 9.9% in 2010.
Michigan State University’s newly constructed medical The Lansing office market consists of more than 15 million
school opened in 2010. The 206-bed, $250 million Helen SF of Class A, B and C office space. The majority of
DeVos Children’s Hospital is scheduled for completion in this space is located between the central Lansing and east
2011. Additionally, the VanAndel Institute, a world renowned Lansing submarkets. The office market has been hit the
medical research facility, is constructing a 240,000 SF, hardest as we continue to see market rental rates fall by as
$178 million addition to its current facility. The addition much as 50% and vacancy rates are near 25%.
creates a capacity for 500 new medical research jobs. The The west submarket Eaton county represents the majority
recovery of the office furniture industry is also creating some of industrial buildings in the marketplace with nearly 50%
Contact new energy in the market place. Contact
of the available inventory. Lansing's industrial market has
NAI West Michigan NAI Mid-Michigan
The office sector is particularly rugged. Per SF sale prices seen negative net absorption specifically in the central and
+1 616 776 0100 Vlahakis Commercial
have dropped an average of 30-40% in the last two years. east Lansing submarkets. With General Motors owning or
+1 517 487 9222
Great purchase opportunities exist for owner occupants. leasing over 30% of the total industrial space within the
Lease activity levels are improving, but many tenants are tri-county region, time will tell what the market has in store
simply testing the market for deals and incentives. Tenants for Lansing's industrial sector as the car manufacturing
are renegotiating rates and terms rather than dealing with industry continues to struggle. For now, vacancy rates have
disruption and the cost of moving. reached there highest levels at close to 20% with low rates
Demand for industrial property in 2010 has improved to of absorption.
some degree. Very little new development came on the Lansing's retail markets consist mostly of regional malls,
Metropolitan Area market in 2010. Bank-owned properties still need to be Metropolitan Area power centers and strip centers totaling over 10 million SF
absorbed and existing buildings need to be redeveloped and of space spread evenly across the market. The retail market
used for growing industries in West Michigan, including seems to have rebounded with positive absorption but with
2010 medical, wind and solar energy, component manufacturing, 2010 the downside being reduced rental rates.
Population 790,673 food processing and related businesses. Population 457,943
The cost of prime land continues to drop as no new devel-
2015 Estimated The retail sector is stagnant, but occupancy rates have 2015 Estimated opment has entered the market. There has been a dramatic
Population 804,107 stabilized. Lease rates are increasingly competitive. Neighbor- Population 456,640 decline in interest from drugstores, regional banks and the
hood retail centers in particular are experiencing declines in medical industry which had previously been driving new de-
336,494
rental rates and tenants are finding a challenging business 207,431
velopment.
environment. Retail has stayed strong despite dismal consumer confi-
Household Despite the downturn, there is good news in West Michigan. Household dence and the highest unemployment rate in over a decade.
There are exceptional lease and purchase values to be Overall the majority of the market activity and growth has
Median found. There are signs of increasing employment and a Median come from the retail and industrial sectors. Michigan
Household Income $55,362 slight loosening of credit requirements. Downtown redevel- Household Income $53,908 continues to exhaust all efforts to attract and retain new and
opment is good. Grand Valley State University continues to existing businesses to the area.
35 construct its downtown campus and the health service 35
industry growth is robust.
Grand Rapids At A Glance Lansing At A Glance

RETAIL RETAIL

Office in CBD $ 1,100,000.00 $ 5,000,000.00 Office in CBD) N/A N/A
Land in Industrial Parks $ 20,000.00 $ 100,000.00 Land in Industrial Parks) $ 10,000.00 $ 50,000.00

Minneapolis/St. Paul, Minnesota Kansas City, Missouri
The Twin Cities of Minneapolis and St. Paul have one of the The bi-state Kansas City Metro benefits from a diverse economic
most diverse economies in the nation, with more than 90% base. Key growth drivers during the downturn include
of all major industries represented and more Fortune 500 manufacturing, transportation, financial services, bioscience
headquarters than any other state. With such a strong busi- and healthcare with intermodal developments capturing
ness climate, the Twin Cities has weathered the recession headlines. Regional economic growth is predicted to outpace
well. As of November 2010 Minnesota’s seasonally adjusted the national rate in 2011. A full recovery is not likely until
unemployment rate was 7.0 percent which is well below the late 2012 when the area Chamber of Commerce predicts
national average of 9.8 percent employment reaching pre-recession levels.
Vacancy and rental rates remained relatively unchanged in The industrial market continues its trend toward larger bulk
2010. The office and industrial sectors recorded an average distribution facilities. BNSF begins construction on its $750
of 10% vacancy, while retail recorded 7% and the multifamily million Logistics Park in Edgerton, Kansas, in 2011. Projected
sector recorded vacancy under 5%. Activity and new lease to open in 2013, the 1,000-acre development will contain a
signings have increased across the board, predominately 440-acre BNSF intermodal facility and 560-acre warehouse
in the retail sector, while development remains virtually project. In Kansas City, Missouri, sites are ready at Center-
non-existent. In addition to the consignment and low rent Point’s Intermodal Center-Kansas City adjacent to the Kansas
occupiers who began to move in 2009, we’re now seeing City Southern Intermodal Facility and future 1.5 million SF
Contact regional and locally owned retailers looking to expand. Last Contact campus for the National Nuclear Security Administration.
NAI Welsh year retail leases were primarily completed to capitalize on NAI Capital Realty
The office market improved modestly during 2010 with overall
+1 800 897 7701 low rents, whereas today there is less emphasis on cost and Kansas City
vacancy decreasing 1% to 18.8% and Class A vacancy
more focus on consumer demand. +1 913 469 4600
decreasing 3.5% to 17%. Competitive rates and incentive
Gordman’s will be making its debut in the Twin Cities market packages spurred many tenants to seek higher quality
with three locations, while Herberger’s, Aldi, Staples, projects. South Johnson County, Kansas, and the Central
Wal-Mart, Big Lots, T-Mobile, Little Caesars Pizza, Jersey Business District were most active with the CBD seeing a
Mike’s and Baja Sol look to add additional locations. The few large users. Kansas City bested 360 cities to land 1,300
bid-ask gap between buyers and sellers is still a reality jobs for a new US Bank operation. We expect a slowly
causing properties to sit on the market for longer periods of improving office market led by South Johnson County with
time. Class B and C properties will continue to fetch low pressure on lease rates and concessions continuing a flight
Metropolitan Area sales prices and be tough to unload, but Class A buildings Metropolitan Area to quality product. The political climate and budget pressure
Economic Overview in top-notch locations with solid tenants should begin to Economic Overview will likely slow the trend of increased governmental/quasi-
2010
move easily at more reasonable prices. 2010
governmental users. Private employment levels need to
Population 3,328,053 A few notable sales completed this year include the Grand Population 2,051,186 increase for sustained improvement.
Hotel Minneapolis, Hilton Minneapolis, The Hotel Minneapolis, Retail remained stagnant with vacancy rates flat or down
Population 3,449,566 Meridian Crossings, 330 South Second Ave., Woodbury Population 2,144,154 slightly and lease rates declining, depending on product type.
Lakes, Block E and the TCF Tower and Bank Building. With New construction is essentially non-existent with the
Employment many loans coming due in the next several years, we expect Employment bankruptcy of the 1.1 million SF Corbin Park and stalled
Population 1,670,747 to see an increase in receiverships and foreclosures and an Population 903,683 redevelopment plans for three area malls. Western Wyan-
increase in activity. The multifamily and retail sectors are Household
dotte County remains an area bright spot with an 18,500
Household
Average Income $88,051 already seeing gains, and industrial and office are expected Average Income $74,045 seat MLS stadium and casino/hotel project under way in the
to follow. Village West development. Other retail and entertainment
Median Median attractions in the area near the Kansas Speedway continue
Household Income $72,379 Household Income $60,442 to exceed expectations.
36 37
Minneapolis/St. Paul At A Glance Kansas City At A Glance

New Construction (AAA) N/A N/A N/A N/A Premium (AAA) N/A N/A N/A N/A
RETAIL RETAIL

Office in CBD N/A N/A Office in CBD (per square foot) $ 1,960,200.00 $ 3,702,600.00
Land in Office Parks N/A N/A Land in Office Parks (per acre) $ 170,000.00 $ 525,000.00
Land in Industrial Parks N/A N/A Land in Industrial Parks (per acre) $ 45,000.00 $ 200,000.00
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park (per acre) $ 35,000.00 $ 225,000.00
Retail/Commercial Land N/A N/A Retail/Commercial Land (per acre) $ 45,000.00 $ 1,075,000.00
Residential N/A N/A Residential (per acre) N/A N/A

St. Louis, Missouri Billings, Montana
St. Louis’ strengths lay in five sectors: bioscience, advanced Billings is the largest city in Montana with a population of
manufacturing, information technology, transportation/distrib- about 100,000 and a 400,000-person trade area. Billings
ution and financial services. This diversity is expected to aid is located along the banks of the Yellowstone river between
St. Louis’ recovery in accordance with national recovery Yellowstone National Park (approximately 180 miles away)
trends–slow but steady. The Federal Reserve’s October 2010 and Little Bighorn Battlefield National Monument. Amuse-
Burgundy Book reported a modest increase in economic ment parks, water slides, the region’s largest mall, western
activity throughout the St. Louis district. shopping and wonderful art and historical museums all lend
The industrial market reflected this growth with sedate gains to the economy of the area.
in net absorption at the end of 2010 after neutral results earlier Billings, the “Big City in Big Sky Country” is also often
in the year. This was aided by historically low deliveries with referred to as Montana’s city. Billings is a special place –
less than 200,000 SF delivered in 2010. Large leases were somewhere between “open space” and “western place.” The
signed by Proctor and Gamble (502,500 SF), Keefe Packaging history and western flair of the region are enhanced by
(288,000 SF) and LuxCo (213,558 SF), although the main Billings’ reputation as a travel hub for metropolitan amenities
activity in the industrial market tended to center around lease such as transportation, retail, medical, accommodations
renewals rather than new tenants. (4,029 guest rooms), fine dining, entertainment, events and
The office market also experienced moderate growth overall a variety of cultural assets. Many events contribute to the city’s
Contact Contact economic success, including the Yellowstone Highland Games,
with significant gains reported by year’s end. Much of this
NAI DESCO NAI Business Properties Magic City Blues Fest, Big Sky State Games, Strawberry
growth was attributable to the Q3 delivery of the Centene
+1 314 994 4444 +1 406 256 5000 Festival, Summerfair, Burn the Point, Holiday Parade,
building in the Clayton submarket. This 485,250 SF building
was 75% leased at the time of delivery. Throughout the market, Farmer’s Market, MontanaFair and NILE.
rental rates are on the decline as tenants continue to seek The area enjoys a stable and diversified economy that
and gain landlord concessions. Free rent and high tenant includes agriculture, tourism, medical services, retail and
improvement allotments will remain the standard until 2012 wholesale and the strong and growing oil exploration and
when employment rates, and corresponding office demand, refinery operations (Exxon, Conoco and Cenex). Unemploy-
are expected to rise. ment in Billings was 5.5% in August 2010, well below the
The retail market remained dormant in 2010 with slightly national average.
Metropolitan Area improved vacancy due to lowered asking rates. Activity Metropolitan Area The downturn in the national economy in recent years has
centered on a revolving door of small retailers and restaurants had a limited effect on the local economy. Vacancy rates
with new owners and franchisees filling vacancies left by their have increased about 10% across the board on office, retail
2010 competitors. Among box users, Wal-Mart showed the most 2010 and industrial properties. While not positive, this increase
Population 2,851,619 activity with ongoing expansion of its current locations into Population 154,903 has not been as devastating as elsewhere. As a result, bank
Supercenters; Von Maur opened its first location in the state foreclosure activity is virtually nonexistent and spaces are
Population 2,907,082 with a 130,000 SF store in the St. Charles submarket; Population 163,037 renting regularly. However, commercial sales in 2009 and
Nordstrom Rack opened its first Missouri location with a new 2010 have dropped significantly– over 80% from 2008
Employment store in the Central St. Louis submarket; and discount retailers Employment levels–due to uncertainty and reduced need. Happily,
Population 1,229,038 such as Big Lots and Weekends Only absorbed vacancies Population 81,813 the second half of 2010 has shown a nice increase in sales
Household
left by Linens N Things and Circuit City. With the exception of Household
interest and activity. Space is available to those in need.
Average Income $70,446 Nordstrom’s expansion at the Galleria, no new developments Average Income $56,354 A 2010 summary showed 672,213 SF of industrial space,
are currently scheduled for 2011. 523,027 SF of retail space and 454,572 SF of office space
Median Median vacant in Billings.

Median Age 38 39
Median Age
St. Louis At A Glance Billings At A Glance

High Tech/R&D $ 7.00 $ 12.00 $ 9.91 12.00% High Tech/R&D $ 16.00 $ 18.00 $ 18.00 N/A
RETAIL RETAIL


Bozeman, Montana Missoula, Montana
Bozeman is the primary urban center in southwestern The name "Missoula" is a Salish tribal name meaning “river
Montana and is the seat of Gallatin County with a population of ambush/surprise." Another translation is a place of "freez-
of 90,000. Located just 90 miles north of Yellowstone ing/cold water." Missoula is now known as the “Garden
National Park and only 45 miles north of the Big Sky resort City.” It is Montana’s second largest city, with a population
community, Bozeman represents an attractive primary and of over 68,202 residents in 2009. Missoula is Western
secondary home market. Gallatin County continues to be Montana's center of education, medicine, business, media,
the fastest growing county in the state. retail shopping, entertainment, culture and recreation.
Anchored by an economy rich in agriculture, the greater Missoula is the principal city of the Missoula Metropolitan
Bozeman market has emerged as a trade region built on the area. Missoula is home to the University of Montana. Over
business spin-offs of research successes of Montana State the last decade, Missoula’s economy has diversified from
University, making Bozeman one of the leading smaller urban timber and mining with major growth in tourism, retail,
centers in the nation. Bozeman’s economy continues to be medicine, manufacturing, trucking and customer service
a primary performer in the state with3.2% annual growth. centers. Missoula is located on Interstate 90 approximately
Major employers are Montana State University, RightNow 198 miles east of Spokane, Washington.
Technologies and Ligocyte Pharmaceuticals. First Interstate Bank has recently completed construction of
Contact While the southwest Montana economy is somewhat Contact a six-story financial center. The project adds approximately
cushioned from the volatility experienced nationally, there 60,000 SF of office space in the downtown area. The GLR
NAI Landmark NAI Crowley Moore
has been a softening in demand for office and retail Building is currently under construction and will add approx-
+1 406 556 5005 +1 406 721 1111
product that will likely slow the absorption of a small imately 30,000 SF to the downtown market. The Old
oversupply. Vacancy is estimated at 8% in the office Sawmill District (formerly Brownfield) located across the
segment and 7% in the retail markets. Market rents remain Clark Fork River near Missoula's Downtown is expected to
off from the 2006 highs, in the range of $10 to $12/SF receive subdivision approval in 2011.
per year for Class A space, and $8 to $10/SF per year for The motel sector is still expanding with one project under
Class B space. Recent retail tenants to ink deals are REI construction. The Smurfit-Stone Paper Mill closed in 2009
for 30,000 SF and Kohl’s announcement of a new store. and is now for sale. The Stimson Lumber mill in Bonner has
In the industrial sector, warehouse demand has weakened closed and is for sale. Missoula’s Trade Area population
Metropolitan Area slightly with the decline in new housing starts. Demand is Metropolitan Area continues to grow with the 2009 tertiary trade area esti-
limited for high-tech flex and R&D space. In 2011, the local mated at over 365,000.
Economic Overview commercial markets can anticipate a more aggressive Economic Overview
Retail expansion slowed on North Reserve Street with Harbor
2010 entry of bank-owned property with the potential for a 2010
Freight being the only new store. Restaurant expansion
Population 92,941 further softening of property values through the bank Population 109,336
slowed as well with just one addition, Five Guys Burgers.
sell-off period. One new Family Entertainment project is under construction
Population 106,595 The historic downtown Bozeman retail and office markets Population 117,182 at the Missoula County Development Park.
remain one of the state’s finest. New private investment The National Guard Armory construction is now complete.
downtown has been stimulated by a $12 million, 435-car 56,415 Residential home sales have slowed considerably with the
Population 47,651 Population
parking garage. A natural gas explosion in March of median home price of $208,775 in 2009. Development in
Household 2009 destroyed a quarter of a city block that is now in Household multifamily units has slowed with average rental rates at $725
Average Income $58,481 redevelopment. Approximately $30 million in new private Average Income $52,944
per month in 2009. Occupancy levels are approximately 97%.
development was initiated or completed in 2010.
Median Median

Bozeman At A Glance Missoula At A Glance

RETAIL RETAIL

Office in CBD $ 850,000.00 $ 1,200,000.00 Office in CBD $ 1,306,800.00 $ 2,395,800.00

Lincoln, Nebraska Omaha, Nebraska
A vibrant, pro-business community, Lincoln is consistently Omaha isn’t just growing; it’s growing quickly. In fact, Forbes
ranked among the best cities in business and livability studies. Magazine recently named it one of the nine “Fastest-Growing
State government, education, insurance and healthcare Cities in the U.S." And it’s no wonder, since Omaha is home
remain the primary drivers of the local economy. Lincoln to the headquarters of nine Fortune 500 and Fortune 1000
recently endorsed a large investment in the city’s future by Companies. Omaha consistently ranks high for quality of life
approving a bond issue to support a $344 million downtown and exceptional private and public education, yet the cost of
project. The project includes a new arena, ice center and a living stays below the national average.
$100 million hotel, office and condo development. The activity in all classes of office has increased over the
Lincoln’s office vacancy inched upward throughout most past 12 months. Part of this increase is due to landlord
submarkets in 2010. The CBD took a hit in early 2010 after aggressiveness in both rent concessions–whether that’s
70,000 SF of Class B office space returned to the market lowering initial base rents or months of free rent–as well as
creating the first large vacancy in several years. Downward other concessions. Office occupancy rates have also increased
pressure on lease rates created a competitive market slightly, concurrent with the economy’s growth. Most new office
allowing tenants with solid financials to take advantage of projects have slowed, with the exception of growing companies
significant incentives. The VA’s new 65,000 SF build-to-suit such as TD Ameritrade, which recently broke ground on its
regional office and KVC’s 38,766 SF lease were two of the 12-story, 475,000-SF corporate headquarters.
Contact largest completed office deals. Contact
Existing mixed-use developments such as Midtown Crossing,
NAI FMA Realty NAI NP Dodge
The retail market had a surge of activity midyear. Local, a $325 million project that spans 15 acres, continue to do
+1 402 441 5800 +1 402 255 6060
well-capitalized retailers benefitted from market conditions well despite vacancies. In fact, Midtown Crossing was
allowing for expansion and favorable lease terms. Several big recently lauded as one of the top 10 projects around the
boxes remain vacant, including Gordman’s, which downsized world according to the Urban Land Institute. Aksarben Village,
to a 55,000 SF new prototype. Quick-service operators Qdoba, a 70-acre site situated in the heart of Omaha, also continues
Jimmy John’s and Scooter’s continue to expand, while to flourish with both office and retail tenants.
new-to-the-market eateries Five Guys Burgers & Fries and Overall, Omaha has seen an increase in retail activity, especially
Pickleman’s find Lincoln an enticing opportunity for growth. national tenants who specialize in the discount sector. Several
A notable new market entry was Trader Joe’s at SouthPointe retailers are interested in the sites surrounding the new Sarpy
Pavilions. County Ballpark, a $26 million project in southwest Omaha
Industrial vacancy rates continued to increase for most product that’s scheduled for completion in April 2011. Additionally,
types. However, with little new construction, the market several hotels are looking for sites near the new TD Ameritrade
2010 experienced infill as overall demand and activity increased. 2010 Park, a $128 million downtown stadium that will serve as
Population 301,907 Asking rates remain aggressive as landlords compete for Population 858,393 home to the NCAA Men's College World Series for the next 25
few tenants in the market. Two significant deals were years. However, there is very little activity with big box,
Population 320,888 FedEx’s 67,000 SF build-to-suit distribution facility and Population 896,436
anchor and junior anchor sites. Landlords are working hard
Telesis, Inc.’s acquisition of a former dairy operation down- to retain retail tenants at the end of lease terms. Renewals
Employment town. This multi-building property will be redeveloped into Employment include holding rent the same or, in some cases, a slight
Population 155,317 a $15 million mixed-use project. Population 413,311 reduction in rent.
Household Lincoln continues to outperform many markets nationwide Household
Average Income $65,546 and remains a stable economy. However, leasing and Average Income $70,128
vacancy rates still have room to improve to return to normal
Median Median
Household Income $55,293 market conditions. With the arena opening in 2013, the next Household Income $59,323
three years will be an exciting ride and position Lincoln well
Total Population for the future. Total Population
34 36
Lincoln At A Glance Omaha At A Glance

RETAIL RETAIL


Las Vegas, Nevada Reno, Nevada
Southern Nevada has received more than its fair share of Traditional economic drivers in Reno are tourism and gaming
media during 2010 reporting about the distress and trouble with warehousing/distribution leading the non-gaming
in the commercial real estate market. Tourism and visitor industry. Gaming revenues and visitor counts remain down
spending, the leading economic drivers, have been reported and industrial activity is soft due to the national economic
down year over year for the first three quarters of 2010. slowdown. Unemployment rose in 2010 from 13.2% to
However, new reports declare Las Vegas real estate, both 13.6%. Although down, activity is starting to show signs of
residential and commercial, as a value buy and say market life as companies are accepting the new normal and
is poised for recovery. expanding if justified. We are anticipating positive absorption
The wave of commercial real estate foreclosures began in numbers and lower vacancy rates in 2011.
2009. Land led, followed by industrial and office develop- Ending 2009 with a record high overall vacancy rate of more
ments that were slated for delivery in 2007 and 2008 but not than 20%, the office market is beginning to see positive
completed. Some of these assets have re-entered the market activity with a current overall vacancy of 18.5% in 2010.
at reduced prices that bridged the bid-ask delta, which Most of the activity has been internally driven, with upgrades
hindered activity in 2009. The end of 2010 shows increased in space classification being optimized as prices continue
activity with owner-user purchases of office and industrial to trade at 10- year lows. The Downtown submarket has
product type. recently seen a good deal of activity as more businesses are
Contact Contact attracted to the revitalization of Downtown Reno and the
During 2010 the office market vacancy rate increased to
NAI Las Vegas NAI Alliance amenities offered. Overall pricing continues to be stagnant,
24%. Total inventory is approximately 50 million SF with 12
+1 702 796 8888 +1 775 336 4600 but this should improve as vacancy declines due to no new
million SF of vacant space exerting downward pressure on
rates and pricing. Industrial vacancy increased to 16%. construction in place or planned.
Of the 106 million SF of industrial inventory, approximately Demand for industrial space remained low with companies
13 million SF are vacant. hesitant to move forward during uncertain economic times.
Retail experienced similar conditions with total inventory Net absorption was negative, causing the vacancy rate to
of 52 million SF and vacancy at 10.5%. The market is rise slightly throughout the year from 15.3% to 15.7%. With
still trying to absorb the anchor spaces that vacated fewer move-outs and more prospects looking, 2011 should
with Linens N Things, Circuit City and various supermarkets begin the long awaited drop in vacancy. Construction
closing. Early in 2010, several spaces were acquired by remained stagnant with companies preferring to take
Metropolitan Area Metropolitan Area advantage of inexpensive existing building options. With
national and regional retailers, such as Kohl’s and Hispanic
Economic Overview grocers. Indicators are that local retailers continue to be an Economic Overview record high vacancy, effective lease rates remained low as
2010 important segment of the market recovery with tenants taking companies shopped for the best deal among many options.
2010
Population 1,976,256 advantage of the historically low rates. Positive net absorption Population 437595 The retail market has an overall vacancy rate of 17%, up
of 47,200 SF through midyear 2010 has been a positive slightly from 16.85% in 2009. After several years of
indicator for retail. Population 471,323
contracting, the retail vacancies seem to be leveling off and
In 2009 everyone expected the delivery of MGM Mirage’s new retailers are opening. Wal-Mart recently opened a
Employment
$8.5 billion City Center to be a catalyst for economic growth. Employment superstore that was a relocation of a smaller store and in
Population 812,360 Population 193,438 2011 will construct and open another superstore in north
For the first time in the history of Las Vegas the delivery of
a new strip property did little to increase tourism. The expec- Reno. Other new retailers to the area include Pier 1, Total
Household Household
Average Income $71,748 tation at the end of 2010 is that lower costs for housing and Average Income $75,341 Wine and More, Einstein’s Bagel, Great Basin Brewery,
a friendly business climate will attract businesses and Popeye’s Chicken, Olive Garden and BJ’s Brewery.
Median Median
retirees, which will result in job growth. Household Income $60,697

37 37
Las Vegas At A Glance Reno At A Glance

RETAIL RETAIL
Downtown N/A N/A N/A N/A Downtown $ 10.80 $ 27.00 $ 18.00 N/A
Regional Malls N/A N/A N/A N/A Regional Malls N/A N/A N/A N/A


Manchester, New Hampshire Portsmouth, New Hampshire
Manchester is the largest city in the state of New Hampshire The New Hampshire Seacoast area is on the upswing of the
and the global economy has found a hub here. Once a down economy. New construction projects have been com-
single-industry town dependent on the textile industry, pleted and are under construction in the greater Portsmouth
Manchester has diversified its economy. It now includes more area. Pease Tradeport Office Park and Downtown
than 200 manufacturing firms, wholesale and retail, Portsmouth remain the desired locations. With construction
information processing and the service industry. Our high under way it won’t be long before more locations are ready
tech companies, manufacturing firms and corporations for occupancy.
thrive, as do the people who keep them running. The Portwalk Project that was put on hold in 2009 is now
The unemployment rate remains below 6%. This stable job under way with a revised plan. In the summer of 2010, the
base has had a positive effect on the real estate market. The Marriott Residence Inn was completed and is operational.
Elliot Hospital, one of the state's largest employers, is nearing The next phase of the project will include market rate
completion of Elliot Care By Rivers Edge. This 236,000 SF residential units and is expected to begin winter 2010/2011.
ambulatory care facility will create 200-250 new jobs and is Also in Downtown Portsmouth is the 56,000 SF building on
scheduled to open in April 2011. In Merrimack, planning is Bow Street that was previously delayed, but now is well
concluding on the 380,000 SF Merrimack Outlet Center, which under construction. This mixed-use building includes retail,
will create 800+ jobs and generate $140 million annually in restaurant and office space. With its convenient location to
Contact retail sales. Scheduled to come on the market is 120,000 SF Contact Market Square this will be a draw for many businesses. At
NAI Norwood Group of office space in the Manchester Technology Building on NAI Norwood Group 233 Vaughan Street in Portsmouth, an elaborate 47,655 SF
+1 603 668 7000 Commercial Street in the Queen City. This will be a gateway +1 603 431 3001 mixed-use building is set to break ground in November
and will also mark the completion of the new Granite Street, 2010. This dynamic creation is set to include retail,
one of the main entrances to downtown Manchester. high-end office space and stylish residential quarters while
New Hampshire has slower development lead time, which providing stunning views. A Gold-LEED Certification is the
insulates the market from over-construction. The market’s goal. It will be the first in the downtown Portsmouth area.
inventory contains vacancies, and the office sector remains Pease Tradeport had a slight increase in vacancy rates, from
the weakest. Due to layoffs, downsizings and a lack of 12% to 15%, but it didn’t stop them from moving forward
growth, office users have found ways to make do with less. and completing projects in 2010. Highlights include a new
Existing tenants have empty offices or cube farms that will corporate headquarters, upgrades to the airport terminal,
Metropolitan Area need to be filled before any expansion. Metropolitan Area construction of a new Pease Golf Course clubhouse,
Economic Overview Economic Overview construction of the 24,000 SF Great Bay Child Care Center
Industrial space has fared better and seen new construction
2010 through this recession. High bay/flex spaces are most in 2010
and renovation and relocation of Great Bay Community
Population 404,021 demand, as is access to the highway system to get to major Population 20,773 College. Jobs held steady at roughly 7,000 employees at
areas like the Manchester-Boston Regional Airport or to Boston. 245 companies. The diversity of the companies represented
2015 Estimated 2015 Estimated at Pease is vast.
Population 406,292 Retail is lagging because most national brands have ceased Population 20,499
opening stores, so local and regional tenants are occupying The New Hampshire Seacoast, with its diverse economy and
Employment
Class A space. Occupancy rates will improve with consumer Employment unique resources, has endured the economic setbacks. With
Population 209,515 Population 11,279 the highest median income in the U.S., combined with
confidence. Landlords giving rental concessions is a very
Household popular trend. Household
Portsmouth’s low 4.6% unemployment rate it is starting to
Average Income $83,577 Average Income $76,599 become “business as usual” mentality.
Median Median

39 44.1
Manchester At A Glance Portsmouth At A Glance

New Construction (AAA) NA NA NA NA New Construction (AAA) N/A N/A N/A N/A
Bulk Warehouse $ 3.75 $ 5.50 $ 4.75 5.00% Bulk Warehouse N/A N/A N/A N/A
RETAIL RETAIL
Regional Malls N/A N/A N/A N/A Regional Malls N/A N/A N/A N/A

Retail/Commercial Land $ 125,000.00 $ 200,000.00 Retail/Commercial Land N/A N/A

Atlantic County, New Jersey Middlesex/Somerset Counties, New Jersey
The gaming industry and tourism are key economic driver In 2010, the commercial market in central New Jersey
in Coastal New Jersey. The casino industry in Atlantic City experienced a slightly higher level of leasing velocity and
was hard hit in 2010 by the continued effects of the reces- sales volume off the lows of 2009 across the industrial,
sion and the opening of 10 of the 14 licensed casinos in office and retail sectors. However, vacancy levels have
Pennsylvania, which now permit table games in addition to continued to increase, mainly due to large blocks of space
slot machines. Current forecasts project another decline in that have continued to come on the market while the increased
total gaming revenue for the industry for the coming year. transactional activity that has occurred on smaller spaces has
Competition from gaming in nearby states has especially not been enough to result in positive absorption.
hurt the hospitality industry, which relies on day trips "Blend and extend" remains the common theme in the leas-
and mid-week visitors for revenues. This, in turn, has ing market as tenants continue to take advantage of the
precipitated an increase in defaults and foreclosures of attractive rents and landlord concessions. Rental rates for
hotel, motel and related properties–adding impetus to industrial properties have stopped falling, especially in
declining value trends in this sector. Atlantic City is trying blocks of space below 300,000 SF. Until such time as
to combat gaming competition from Pennsylvania and other companies begin to increase their inventories, this sector
nearby states by enhancing the entertainment venues, will continue to struggle.
as well as funding a $30 million marketing blitz by the main The office market remains a tenants’ market. This sector
Contact casino companies. Governor Christie announced his intention Contact
saw a slight increase in rents for Class A space. This was
NAI Mertz to remove control of the gaming district to a state adminis- NAI DiLeo-Bram & Co.
partially due to tenants in Class B space taking advantage
+1 856 234 9600 tered authority with the intent to bolster a strong sport and +1 732 985 3000
of market conditions by upgrading to Class A space at rental
entertainment industry. rates not previously in their budgets.
The Atlantic County office market held its vacancy rate at The retail sector in central New Jersey remains the strongest
approximately 15% throughout the year. Leasing activity sector. Although vacancy rates have increased, the majority
has been fairly constant, but overall rental rates have of the vacancies are in sub- AAA locations. Tenant spaces
declined by almost 10% and free rent concessions continue that have gone dark in AAA locations have been backfilled
to be the norm. quickly. There are two notable public projects planned for
The Atlantic County industrial vacancy percentage is similar 2011 that will have an immediate positive impact in the
Metropolitan Area to the office market at approximately 15%. Atlantic County’s Metropolitan Area market: First is the expansion of the Rutgers University
retail market is slow, which is no surprise given the decline Piscataway Campus, a 648,000 SF mixed-use project that
in gaming activity and recession-related decline in the includes housing, retail space and a hotel conference center.
2010 tourism industry. However, the Atlantic City Walk, a Cordish 2010 In addition, the city of New Brunswick is expected to start
Population 276,846 retail outlet development, has announced its expansion of Population 1,127,680 construction of a 625,000 SF Wellness Center and Transit
an additional 45,000 SF consisting of 15-20 stores. Village next to the Robert Wood Johnson Hospital in down-
Population 280,365 One of the largest non-casino/non-tourism related employers Population 1,156,056
town New Brunswick.
in the region is the William J. Hughes Technical Center, The forecast for central New Jersey in 2011 is for the
Population 118,620 which is the nation’s premier aviation research and devel- market to continue to inch along toward a sustained
Population 538,179
opment, test and evaluation center and serves as the FAA’s recovery. Activity appears to have stopped declining. As
Household national scientific test base. Household companies continue to take advantage of the attractive
Average Income $68,021 Average Income $110,819 rental rates with no new product entering the market,
Median
vacancies should continue to decline and rents will increase.
Median

39 38
Atlantic County At A Glance Middlesex/Somerset Counties At A Glance

RETAIL RETAIL


Northern New Jersey Ocean/Monmouth Counties (“Shore Market”), New Jersey
The Northern New Jersey commercial real estate market- The Coastal New Jersey counties experienced continued
place closely follows the national economy. Employment volatility into late 2010, and the economy still faces significant
growth is a crucial component necessary for any sustained employment headwinds. The area was buoyed by a strong
recovery. The region boasts one of the largest and most diverse tourist season and outstanding summer weather that strongly
commercial real estate markets in the country. Insurance, supported tourism activity. Commercial resort owners took to
financial, pharmaceutical, telecom, manufacturing,retail some good buying opportunities and will likely reinvest into
and international companies are the backbone of our 2011. The State of New Jersey mandatory furloughs for state
marketplace. We remain a very desirous and competitive workers and the national exposure of the MTV hit “Jersey
market for commerce and industry. Shore” continued to drive tourist activity.
Office vacancies remained steady for the past few quarters The region also posted some significant property trades
at 18-20%. Vacancies have decreased with what we hope among major commercial corridors in the auto dealership
is the beginning of positive absorption activity. Renegotia- sector as the fallout from 2008-2009 left an overhang
tions, consolidations and short-term lease renewals have of vacant dealerships. Leasing activity, particularly in the
been the norm. Our market provides opportunities for healthcare and medical office sectors, picked up in early
companies seeking to consolidate or upgrade space needs. 2010 and remained steady for most of the year. Sales activity
The industrial market was hit hard by the recession but is and pricing remained weak and the land market continues to
Contact Contact suffer from a complete lack of buyer demand.
recovering and has seen new absorption. Vacancies remain
NAI James E. Hanson NAI Atlantic Coast Realty
at historical highs (8.5-9%) yet a continued demand for flex During the past year we noted an uptick in interest from
+1 201 488 5800 +1 732 736 1300
and R&D space keeps the market vibrant. Additionally, the multifamily developers and small scale residential builders
Port of New York/New Jersey remains busy with growth in on tracts under 20 units. Multifamily cap rates re-compressed
the international import/export business. Even with an a in 2010 after spiking in 2009. Continued strong rental rates,
bundance of space, it is difficult to find modern, high ceiling, low vacancies and high buyer demand elevated multifamily
big space warehouses. Competitive rental rates encourage pricing once again, particularly on B+ product with some
opportunities for companies seeking upgraded space and upside.
others are relocating from surrounding marketplaces. Retail market conditions remain mixed, with value retailers in
The retail sector in Northern New Jersey has been most a very strong position and expanding. But with an absence
Metropolitan Area impacted by the economic crisis. Retailers have stopped Metropolitan Area of strong in-line retailers, in-line rents are down and vacan-
opening new stores while others have vacated. Tenants cies are increasing. Pad-site land deals, previously over
restructure leases while landlords manage each situation $1 million have retreated below $750,000.
2010 independently. Vacancy rates have leveled off as of Q2 2010, 2010
The Coastal New Jersey market is heavily dependent upon
Population 4,095,458 yet remain high at 8-9%. Certain markets fare better than Population 1,228,157
the construction trades, and office and industrial demand has
others; the larger malls remain leased and are doing well. held its own considering the lack of activity from construction
Population 4,098,849 The investment market remains brisk. There is an abundance Population 1,263,877 related users who typically drive the market. Some of the
of investors looking for opportunities that fit their portfolios. activity is merely expansions, but Q3 to Q4 of 2010 seemed
Core properties are quickly acquired. The multifamily market- to mark a turning point in leasing activity for office/industrial
Population 1,825,514 Population 526,981
place also remains active. Class A office and industrial users with activity up significantly. With new construction
Household properties are aggressively pursued. Cap rates have Household almost non-existent and land pricing depressed, 2011
Average Income $95,793 compressed with 6.5-8% the norm. Overall, the Northern New Average Income $93,467 is expected to be a building year as the economy crawls
Jersey commercial real estate market remains flat. New from the brink. The Coastal New Jersey market is a unique
Median Median
Household Income $71,915 tenants are moving in and some moving out. However, Household Income $72,703 market with assets generally sub-$5 million, so the return of
there are new deals in the process of being negotiated regional and local investors will stabilize pricing just in time
Total Population and/or completed. Total Population for new demand.
Northern New Jersey At A Glance Ocean/Monmouth Counties (“Shore Market”) At A Glance

RETAIL RETAIL


Princeton/Mercer County, New Jersey Southern New Jersey
The Greater Princeton area is recovering from a worldwide The Southern New Jersey market is located at the center of
economic downturn. This can be attributed to Princeton’s the Northeast Corridor (Washington, DC, to Boston) and is
diverse employment opportunities, which include biotechnol- serviced via excellent road networks, rail capabilities and
ogy, financial, medical, education and government presence. port facilities. Companies looking to service the Greater
Princeton’s geographic location and affordable housing has Philadelphia market as well as a solution for almost any
made it a preferred location for consolidation. Companies such logistic or supply chain requirement looking to service
as Otsuka Pharmaceuticals (130,000 SF) and Axis Insurance the Northeast Corridor, find that the Southern New Jersey
(35,000 SF) have relocated here this year. marketplace has a lower occupancy cost (real estate and
This demand for office space has staged the turning point employment costs) than most markets.
for the office market to reach a lower vacancy as we The Southern New Jersey industrial vacancy rate in 2010
approach 2011. The vacancy overall has stayed consistent saw an increase of approximately 1% to 11% as a result of
at 21% for the last 10 quarters and has lowered to 20%. the continued downsizing of the larger tenants in the market.
The combination of migration, medical office growth (due to Although leasing activity started the year at a slow pace,
two new hospitals being completed), a recovering financial there has been a noticeable uptick in activity since the
sector and federal government, which is growing, has added beginning of the 2010 summer. Lease rates and sale prices
to this turn of events. have been stabilized, but heavy landlord concessions are
Contact Contact still the norm and are necessary in order to close lease
The industrial sector has experienced the same increase
NAI Fennelly NAI Mertz transactions. The largest industrial deals to close in 2010
due to mergers and acquisitions and strong logistic location
Associates, Inc. +1 856 234 9600 include New Breed Transportation for 325,000 SF (relocated
to the Seaports. Ritchie & Page's build to suit for 180,000
+1 609 520 0061 and downsized) and New Century Transportation for
SF at Exit 7A of the New Jersey Turnpike is one of the first
of several new build-to-suits. Industrial companies are using 172,000 SF, which was an expansion and relocation into a
this downturn as a way to buy new buildings for discount, 108-door truck terminal.
such as Princeton Optronics purchasing a 47,000 SF Leasing activity in the Southern New Jersey office market
manufacturing building for $32/SF. started to pick up at the end of Q2 2010, which helped
The retail sector was affected the most in this recession and stabilize the overall vacancy rate at just under 12% and
has seen rents drop by 30%. The reduction combined with maintained a blended rental rate of approximately $17/SF
a small rise in consumer confidence has caused some for full-service properties. Free rent concessions continue
Metropolitan Area Metropolitan Area to be the catalyst in closing office deals with the standard
retailers to expand to take advantage of low entry costs.
Economic Overview Economic Overview offer of approximately one month free rent per year being
Franchise operations are growing as displaced workers take
2010 their savings and become entrepreneurs for the first time. 2010
the norm. The largest deals completed in 2010 include
Population 371,697 Retro Fitness recently opened two locations, one in Kingston Population 1,333,543 Pinnacle Foods in Cherry Hill (57,000 SF) and Ballard Spahr
and one in Lawrence, for 15,000 SF each. Law Firm (20,000 SF), also in Cherry Hill. Also of note is
2015 Estimated 2015 Estimated the scheduled delivery in Q4 2010 of New Jersey Manufac-
Population 378,512 The investment market returned in 2010. The most notable Population 1,356,090 turers build-to-suit development of 146,000 SF.
transaction is the purchase of 300 Alexander Park for
Employment
$155/SF by a user. The building was sold for $176/SF five Employment The retail sector appears to have bottomed out. Retail
Population 182,165 Population 614,303 redevelopments have shown some pockets of success, notably
years earlier. Investors purchased 104 Windsor Center, a
Household 68,000 SF office building only 12% occupied, for $50/SF. Household
Cooper Towne & Gateway Center and Somerdale’s redevelop-
Average Income $95,345 The sale numbers are showing great disparity based upon Average Income $83,220 ment project with a new 190,000 SF Super Wal-Mart.
the risk of vacancy. Median
Median

Princeton/Mercer County At A Glance Southern New Jersey At A Glance

RETAIL RETAIL

Office in CBD $ 400,000.00 $ 1,000,000.00 Office in CBD N/A N/A

Albuquerque, New Mexico Las Cruces, New Mexico
The Albuquerque MSA is ranked the 57th largest metropol- The story of the Las Cruces Metropolitan Statistical Area
itan area and one of the fastest growing cities in the nation, remains one of predictable, documented stability. The same
according to the U.S. Census. Approximately half the New economic fundamentals that have insulated the area from
Mexico population resides in the Albuquerque area. The innumerable business cycle downturns in the past have also
apartment and medical sectors are the performance leaders lessened the impact, in both depth and duration, of the
as other market segments recover. The retail market appears current global economic crisis. This underlying strength, sta-
to be following close behind with respectable absorption and bility and resilience is evidenced across all sectors of the
lower vacancy. The industrial and office sectors appear to be Las Cruces commercial real estate market.
more stagnant but with some absorption. The local office market has maintained operating indicators
Presbyterian Healthcare commenced construction of the first at or near historical averages, with 2010 seeing a 90 basis-
phase of the 66-acre Regional Medical Center, which point rise in vacancy and just over a half-point decline in
comprised a $165 million, 292,000 SF construction project. average lease rates. Vacancy rates in this employment
Along with the opening of the 218,000 SF Hewlett Packard sensitive sector have remained in single digits throughout
facilities in Rio Rancho’s City Center, the northwest corridor this period of corporate contraction and consolidation.
of Albuquerque (Rio Rancho) captured the majority of the Flat year-over-year Gross Receipts from Retail Trade
new activity. Premier Theaters also broke ground on its revenues—a variance from trend not seen in the Las Cruces
Contact 55,000 SF, state-of-the-art movie theater in Rio Rancho. Contact
Metro Area since 1990—appears to have had little effect
NAI Maestas & Ward Additional retail, restaurants and medical developments are NAI 1st Valley
on the overall retail market. Surveyed properties actually
+1 505 878 0001 planned and will break ground in 2011, following the new +1 575 521 1535
registered a 0.4% drop in average vacancy, remaining
hospital and movie theater. in single-digits and several percentage points below the
Retail activity has been surprisingly strong, with single-digit 2000-2010 average of 12.6%. However, retaining those
vacancy and some anchor activity. Retail construction will existing tenants came at a price. Specifically, a $0.55/SF,
start to occur in late 2011 and into 2012. The majority or 3.3%, drop in average asking lease rates. 2010 witnessed
of this activity will take place in the far northeast and far national retailers continuing their entry and/or expansion into
southwest quadrants of the MSA. the area, albeit at a pace slower than that seen during the
Apartment occupancies continue to outperform each of peak.
Metropolitan Area the other segments with 95% occupancy citywide. Upward Metropolitan Area Despite a spike in permitted multi-family construction and
pressure on rental rates will continue for the immediate the emergence of ‘shadow-market’ rental units, the Las
future because there are no new projects scheduled for Cruces multifamily market continues to post impressive
2010 development and Albuquerque continues to grow. The Class 2010 performance figures. With a 2000-2010 period market
Population 886,814 A, 198-unit ABQ Uptown Village sold in fall 2010, signifying Population 215,179 average occupancy of 93.7% and average annual rental
the largest multifamily transaction for the year. increases of 2.4%, this has proven to be a perennial favorite
Population 975,641 The Journal Center corridor continues to be an active Population 234,400 among local and regional real estate investors. Several
submarket for office with the largest transaction in the city recently released national polls place Las Cruces on the Top
Employment
being the 98,000 SF build-to-suit for the U.S. Forest Service. Employment 10 List of Small Metro Areas for job generation. This ranking,
Population 367,488 Population 82,284 coupled with increasingly stringent home mortgage
More medium- to larger-scale single-user office develop-
Household ments are expected to occur in the Journal Center and North Household
loan requirements, bodes well for the demand side of the
Average Income $64,694 I-25 trade area. Average Income $48,576 multifamily equation.
Median Median

36 31
Albuquerque At A Glance Las Cruces At A Glance

RETAIL RETAIL
Neighborhood Service Centers $ 9.00 $ 28.00 $ 15.00 9.70% Neighborhood Service Centers
N/A N/A N/A N/A
Office in CBD $ 1,089,000.00 $ 2,178,000.00 Office in CBD $ 245,000.00 $ 400,000.00

Albany, New York Long Island, New York
The Capital Region of New York State is feeling the early The Long Island economy has improved in some areas
ripples of growth due to the construction of the $2 billion throughout 2010 but still needs time to see significant
chip fabrication plant under way in Malta, NY. Slated improvement. The unemployment rate of 6.9% is slightly
to employ 1,300 tech-related workers, the more attractive better than one year ago and significantly below the national
positive will be the 5,000+ support jobs coming into the average, as usual. Activity has increased in most segments
area. Real estate around the park is beginning to benefit in 2010, but tenants, owners and investors remain cautious.
from the increased demand for close, convenient space to Probably the most significant news for Long Island in 2010
house these support services. was the groundbreaking of Canon’s new 700,000 SF North
The downtown/CBD office market continues to struggle with and South American headquarters in Melville. Public officials
a glut of Class B or lower inventory, and a vacancy rate at were able to craft a large incentive package for the $650
or above 20% in some recent polls. Much of the vacant million project with an expected completion in mid-2012.
inventory is in functionally obsolete buildings with floor It will undoubtedly provide a major boost for the local economy.
plates that require substantial capital to renovate, leaving The investment market has not been what most predicted
only the Class A spaces to vie for the few office tenants that as lenders have been slow to react to defaulted loans,
need to be situated within a stone’s throw of the government instead opting to enter into lengthy negotiations with current
process. Residential re-development is slow to come with a borrowers. Negotiations have lasted many months in most
Contact lack of ability to secure acquisition and construction cost Contact
cases causing fewer foreclosures than anticipated. Some
NAI Platform loans. The suburban office parks are performing well and NAI Long Island
well capitalized investors hoping to find more distressed
+1 518 465 1400 are experiencing lower vacancy rates between 10-12% +1 631 270 3000
assets have turned their attention elsewhere.
overall. Large office tenants have benefitted with attractive
rates for build-to-suits. Activity has increased in the office sector as tenants are
taking advantage of lowers rents and landlord incentives to
The industrial marketplace has been the leading segment upgrade to higher quality space. Vacancy rates for Class A and
in the Albany marketplace, with brisk activity and stable B space stand at 11.2 % and 10.5%, respectively, representing
rates. Vacancy rates are in the 8-12% range overall in slight improvements over last year. Landlords continue to offer
spaces of 25,000 to 50,000 SF, and the numbers are significant rent concessions to attract tenants.
slightly better for new construction and flex spaces that offer
a quality office component. The industrial market has shown signs of improvement as
Metropolitan Area Metropolitan Area vacancy rates have dropped to 7.0% from 9.0% a year ago.
Retail activity has slowed considerably. The slower economy Many users have opted to lease instead of purchase due to
and inability to control costs have driven out several local rent reductions as well as the lack of capital available.
2010 restaurants. Concept chains are still viewing the area as 2010
Population 860,803 a possibility, as evidenced and bolstered by Cheesecake Population 2,700,000 Retail activity has increased as most big box space vacated
Factory and P.F. Chang’s decision to locate in Albany. Texas by Home Depot Expo and Circuit City has been filled. Large
2015 Estimated 2015 Estimated tenants such as Shop-Rite, Lowes, Wal-Mart and BJ’s
Population 870,276 Roadhouse has just inked a deal along a highly sought Population 1,344,043
after corridor. Warehouse are actively looking for sites and smaller tenants
Employment Employment such as TD Bank, 7-eleven and Five Guys Burgers remain
423,339
Investment and multifamily offerings were down slightly, as active in adding locations.
Population Population 643,199
lenders continue to tighten their requirements. The positive
Household is that this practice has driven cap rates up slightly, to Household
Average Income $70,117 an average of 8-9% overall. As a strong tertiary market- Average Income $123,227
place, the Capital Region has remained a stable and safe
Median Median
Household Income $58,203 environment to live, work and invest in. Household Income $101,176

40 41
Albany At A Glance Long Island At A Glance

Manufacturing $ 3.75 $ 6.50 $ 5.15 N/A Manufacturing N/A N/A N/A N/A
High Tech/R&D $ 7.50 $ 10.50 $ 9.00 N/A High Tech/R&D $ 14.00 $ 18.00 $ 16.00 9.00%
RETAIL RETAIL
Downtown $ 10.00 $ 18.00 $ 13.00 N/A Downtown N/A N/A N/A N/A


New York City, New York Westchester, New York
The Manhattan office market was on an upward trend Westchester County has not been hit as hard as many areas
throughout 2010. Positive absorption of 1.5 million SF in Q3 throughout the country, but it remains the highest taxed
nearly doubled already encouraging Q2 figures. Overall county in the nation. Businesses are leaving here for better
vacancies have fallen to under 12.6%. Midtown and Mid- economic opportunities in the South, and if they need to be
town South continued to drive a recovery, with falling va- close to New York City, New Jersey continues to be a very
cancies and rising absorption. Asking rents ticked up to good alternative. There has been a substantial increase in
$49.40/SF, driven by the leasing of Class A space. available retail and office space, and the industrial market
The removal and absorption of what was an abundant is flat.
supply of sublease space is encouraging to landlords The biggest change in the real estate market over the past
and will drive asking rents higher during 2011. Downtown year has been the increased amount of retail space available
again lagged the market, with rising vacancies, falling rents for lease. While it is true there has been substantial absorp-
and negative absorption, but less so than during previous tion, this is due primarily to several supermarkets (ShopRite,
periods. Trophy/Class A buildings saw strengthening Fairway, Stop & Shop) and Walgreen's taking some of
fundamentals throughout all submarkets and are viewed as the bigger spaces. Smaller "mom & pop' shops continue to
leading indicators for the broader market. The recovery to struggle and many are closing. Real estate taxes are
date has been atypical, as law firms, media and marketing extremely high and owners have not adjusted their asking
Contact industries take advantage of availabilities and pricing in Contact rents to prices that are attractive to small businesses.
NAI Global New York City quality space. Financial institutions, which generally take the NAI Friedland National retailers have left the market, 99-cent stores are
+1 212 405 2500 bulk of the space, are doing so on a lesser scale. +1 914 968 8500 taking spaces previously occupied by high-end retailers and
There are still empty desks in many spaces, but more firms we do not see change coming in the near future.
are choosing to hold these assets in anticipation of improving The office market has seen price reductions as owners are
economic conditions. Confident tenants are becoming less trying to fill up empty space. Most of the deals being done
hesitant to explore options and tenants with good credit will are renewals, and landlords are giving incentives to their
continue to have the upper hand with landlords offering tenants to renew early. Many owners in Westchester had
increased concessions. The stabilization of sublet space is hoped to benefit from the very high prices in New York City,
another indication that the market may soon turn around. but when vacancies rose at a rapid rate in Manhattan, those
Firms are holding onto space for anticipated staffing needs, businesses that might have relocated were given incentives
Metropolitan Area rather than disposing of it at a loss only to lease space at a Metropolitan Area to stay put.
Economic Overview premium once the market has recovered. Economic Overview The industrial market in Westchester is flat. Prices have
2010 Private employment, passenger traffic to the NYC airports and 2010 dropped, but the amount of vacant space continues to rise
Population 19,113,505 the Manhattan hotel occupancy rate all rose in the second half Population 19,113,505 and there do not appear to be many tenants looking.
of 2010. Investment sales in Manhattan have attracted a Businesses are having trouble getting the necessary capital
Population
greater number of foreign investors and well capitalized Population
to grow, as credit is still very hard to get. As a result, busi-
19,404,040 19,404,040
investment groups will seek to take advantage of a new nesses are staying where they are, occasionally looking
Employment pricing structure, spurring the expected turnaround. As we Employment around to see what's out there, but ultimately making a deal
Population 8,380,201 look to 2011, most predictions point to slow growth in Population 8,380,201 with their current landlord in order to avoid the cost of
employment and GDP. However, debt concerns are daunting moving or closing shop.
Household Household
Average Income $90643
as the commercial real estate sector approaches nearly Average Income $90,643
$1.4 trillion in debt coming due by 2015. Even still, capital
Median markets are loosening in Manhattan, and allowing for Median
Household Income $66469 significant acceleration in building sales and transaction Household Income $66,469
value. While we are not yet in the clear, industry leaders are
Median Age 38 optimistic and we seem to be exceeding 2009 recovery Median Age 38
expectations across the board.
New York City At A Glance Westchester At A Glance

MIDTOWN OFFICE MIDTOWN OFFICE
Bulk Warehouse N/A N/A N/A N/A Bulk Warehouse $ 9.00 $ 14.00 $ 8.00 10.70%
RETAIL (Midtown) RETAIL (Midtown)
Midtown $ 75.00 $ 2,000.00 $ 135.00 4.10% Central Business District $ 30.00 $ 75.00 $ 49.88 15.00%
Neighborhood Service Centers N/A N/A N/A N/A Neighborhood Service Centers $ 35.00 $ 40.00 $ 35.63 15.00%
Community Power Center N/A N/A N/A N/A Community Power Center $ 35.00 $ 45.00 $ 38.00 10.00%

Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park N/A N/A
Retail/Commercial Land N/A N/A Retail/Commercial Land N/A N/A

Asheville, North Carolina Charlotte, North Carolina
With its diverse economy, solid infrastructure and skilled After years of being closely identified with the banking
workforce, Asheville is a great place to do business. An industry, Charlotte has successfully attracted new employers
inclusive healthcare industry and a strong tourism sector con- in the energy, healthcare, defense and film sectors. These
tinue to fuel the local economy. A growing mix of newcomers have put Charlotte on the path of recovery from
professional/technical services, knowledge-based enterprises the loss of high paying banking jobs in the aftermath of the
and arts/crafts industry enhances the business landscape. recent financial crisis.
The office market vacancy rate has decreased slightly over Over the last 18 months, four new buildings totaling 2.85 million
the past 12 months with rental rates remaining stable. SF were delivered in the CBD. The market was pleasantly
The largest lease transactions have been predominantly surprised when Bank of America and Duke Energy committed
in the healthcare industry. There is continued job growth in to more space than originally expected, reducing the fear that
western north Carolina. The area unemployment rate has the vacancy rate would jump to 16% or more. The end result
dropped by 0.9% over the past 12 months and continues has been an overall vacancy rate of 12.1%, which is near
to be lower than the state and national average. historical averages. The Bissell Company continues to buck the
Approximately 7.1% of the market’s retail inventory was trend by building new speculative office buildings each year
reported vacant, a slight decrease over the past 12 months. in the internationally acclaimed Ballantyne Corporate Center.
Several mixed use projects were completed. Last year Bissell delivered two 150,000 SF buildings to the
Contact Contact market.
NAI BH Commercial Industrial vacancy rates are at 14.2% with rental rates NAI Southern Real Estate
between $2 and $8 SF. There were no properties under Only one industrial building was delivered in 2010: Silver-
+1 828 210 3940 +1 704 375 1000
construction in Q4 of 2010. Landing, a 125,000 SF distribution center. SilverLanding was
leased in its entirety by Replico. Overall vacancy increased
The Asheville regional airport recently adopted a 20-year by 3% in the face of flagging demand. Most deals were lat-
master plan to handle the increased traffic that is expected eral moves made by existing tenants in the market, versus
as growth continues in the region. The plan calls for expansions or in-migration.
improvement and expansions to current facilities, including
a $20 million investment over the next five years. Home to Two new Wal-Mart anchored centers, 236,000 SF and
nine breweries, Asheville is a front runner in the recent surge 176,000 SF, respectively, accounted for the bulk of the new
in craft beers and microbreweries in the US. Asheville retail space delivered in 2010. The region’s average vacancy
Metropolitan Area was recently named 2010 Beer City USA in an online poll, Metropolitan Area rate increased from 1.1% to 9.5% and the average rental
beating out Portland, Oregon, for top billing. rate fell $0.16 to $18.66/SF.
One of the key advantages for businesses in Asheville is its The investment market picked up some momentum in 2010
2010 2010
suitability both as a place to live and a vital place to grow a after a dismal 2009. Several grocery-anchored centers
Population 420,918 Population 1,793,478
business. Asheville has been ranked by several prominent traded at impressive levels as investors sought core assets
2015 Estimated publications: # 6 among all US cities as a place to do 2015 Estimated with stable returns. There was a substantial increase in
Population 444,059
business by Forbes Magazine (July 2010), # 1 of Top 25 Population 2,058,636 single-tenant deals, banks, auto and drug stores. Several
Small Cities by American Style Magazine (May 2010), # 21 industrial buildings sold between a 9.0-9.5% cap rate,
191,176 in the 200 Best Places for Business and Careers by Forbes Population 760,218 including a 491,000 SF building on Nations Ford Road.
Population
Magazine (April 2010), one of the 10 Best Places for a
Household Household
$55,978
Second Home by Barron’s (March 2010) and # 1 of the 100 $76,595
Best Places to Retire by TopRetirement.com and Market-
Median Watch (February 2010). Median

43 36
Asheville At A Glance Charlotte At A Glance

Manufacturing $ 3.50 $ 6.00 $ 4.50 15.00% Manufacturing $ 3.00 $ 5.25 $ 4.00 N/A
RETAIL RETAIL


Greensboro/High Point/Winston-Salem, North Carolina Raleigh/Durham, North Carolina
The Piedmont Triad market suffered its share of setbacks in The Milken Institute ranked the Raleigh-Cary and Durham
2010, with an unemployment rate in excess of 11% and the metropolitan statistical areas among the 15 best performing
closing of the flagship 790,000 SF Dell manufacturing plant metros in the country. Raleigh-Cary came in at #7, up from
in Kernersville. Industrial vacancies for modern distribution #10 a year ago. The rankings are based on jobs,
centers over 200,000 SF exceed 6 million SF, an estimated wage/salary and technology growth. Helping our region to
10-year supply at historic absorption levels. The only bright receive those high marks is The Research Triangle Park,
spot is increased demand for warehouse space between one of the most successful R&D centers in the world
20,000 and 40,000 SF with rents in the $3.00-$3.50/SF featuring microelectronics, environmental sciences, phar-
range. maceuticals and biotechnology companies.
The main bright spot for the region is a $426 million The local office market experienced a slight rise in office
Caterpillar manufacturing facility in eastern Forsyth County. vacancy at the end of Q3 2010 with a rate of 17% for
Caterpillar will employ 510 and will open the 850,000 suburban Class A and 25% for suburban Class B. Net
facility in early 2012. In addition, TIMCO Aerosystems will absorption totaled approximately 392,000 SF over the past
open an aircraft seat manufacturing plant employing 500 in 12 months. Rental rates showed a slight decline over the
northern Davidson County in early 2011. previous quarter. Approximately 287,000 SF of office space
The retail sector has continued to deteriorate with small was under construction at the end of Q3 2010. There were
Contact Contact 11 office sales transactions with a total volume of approx-
shop vacancies reaching 25% and tenants going out of
NAI Piedmont Triad NAI Carolantic Realty, Inc. imately $65,000,000. Cap rates were unchanged in 2010,
business faster than the landlords can lease the space. The
+1 336 373 0995 +1 919 832 0594 averaging 8.08% compared to the same period in 2009.
forecast for 2011 is more of the same, with little hope of
substantial improvement until 2013. The industrial market vacancy rose slightly from the previous
The office market has followed other market segments, with quarter with a vacancy rate of 19%. Net absorption was down
cutbacks caused by Wachovia’s demise freeing up large in the flex category, but the warehouse market had approxi-
blocks of space in downtown Winston-Salem. Vacancy mately 109,000 SF absorbed over a 12 month period. Rental
is over 18%. There are sporadic signs of activity, with a rates also decreased slightly to an average of $5.25/SF. Very
financial services arm of LabCorp bringing 383 jobs to little construction is underway with only 30,100 SF on the
Greensboro in Fall 2010. Expansion of a third runway and market. There were 12 industrial sales transactions with a
major road improvements have resulted in a $300 million total volume of $21,140,000. Cap rates have been lower in
Metropolitan Area Metropolitan Area 2010, averaging 8%, compared to last year’s 8.22%.
FedEx Mid-Atlantic hub opening at the airport and the
location of a 400,000 SF FedEx Ground sorting facility in The retail market has improved slightly to 8% vacancy
2010 Kernersville. Honda jet opened a headquarters facility at the 2010 with positive absorption over 12 months of 357,000 SF.
Population 1,202,334 Airport and will deliver light jets in 2012. Population 1,667,221 Sublease space increased by 34,000 SF. Approximately
340,000 SF is currently under construction. Over the past
Population 1,270,536 Population 1,937,071 four quarters, a total of 560,559 SF of retail space has been
built in Raleigh/Durham. Rental rates ended in Q3 2010 at
Employment Employment $15.11/SF, down from $15.50/SF the year prior. Retail
Population 54,4268 Population 764,183 sales rose with three transactions totaling $16,960,000.
Household Household
There were nine retail sales transactions with a total volume
Average Income $64,431 Average Income $79,488 of $34 million. The price per square foot averaged $133.93.
Cap rates have been lower in 2010, averaging 8.60%
Median Median compared to 8.72% during the same period in 2009.

39 35
Greensboro, High Point, Winston-Salem At A Glance Raleigh/Durham At A Glance

New Construction (AAA) $ 22.00 $ 28.00 $ 25.00 N/A New Construction (AAA) $ 25.00 $ 28.95 $ 26.98 N/A
RETAIL RETAIL


Fargo, North Dakota Akron, Ohio
Fargo-Moorhead is a metropolitan area with a vibrant popu- The Akron market is strategically located 35 miles south of
lation of nearly 200,000 and more than 26,000 college Lake Erie and is a central hub offering great interstate
students. The Fargo-Moorhead community is known for access for most type of companies whether corporate office,
steady growth, a highly trained workforce, business-friendly industrial or warehouse use. Akron also serves as the county
environment, outstanding quality of life and a reasonable cost seat for Summit County government, as well as related State
of living. The Fargo-Moorhead population epitomizes the and Federal agencies. The overall 2010 market saw a little
Midwestern values of hard work, honesty, integrity and some- positive swaying in the marketplace with leasing activity
thing we call “Minnesota-North Dakota Nice.” increasing and rates trending to stabilize.
Fargo-Moorhead’s business environment is evolving rapidly, Greater Akron showed new-construction improvement in
adding new expertise, facilities and capacity every day. Busi- 2010 over 2009. Summa Hospitals is expanding with a $10
nesses here are benefiting from world-class education and million project in Wadsworth/Rittman and construction of a
research, unique advanced facilities, strong industry-university $25 million rehab/therapy hospital in Akron, and a planned
partnerships, sophisticated business infrastructure and hard- 25-acre suburban outpatient facility. Akron General is also
working, skilled and productive employees. Our companies expanding in Green with a 140,000 SF, $32 million wellness
are growing, competing globally and profiting in a community center. All these projects are scheduled for construction and
that is fully engaged in deliberate, cooperative and business- completion in 2011-2012.
Contact focused planning and execution. Contact
Bridgestone-Firestone broke ground in spring for its new
NAI North Central NAI Cummins
National Rankings of the Fargo-Moorhead Business Climate $100 million technical center. Goodyear Tire & Rubber
+1 701 364 0244 Real Estate
include #9 in Forbes Best Places for Business and Careers, continues working on financing for its new headquarters.
+1 330 535 2661
April 2010. This is the seventh consecutive year that Fargo Another bright spot in the area is the Akron-Canton Airport
has made the top 10 for small metropolitan areas. The index which has been thriving due to ongoing expansions and
ranks cities according to cost of doing business, educational provides an estimated $400 million in annual revenue to
attainment of the population, income growth, projected job the area. The adjacent ground is being positioned for
growth and net migration. Additional accolades include: #1 expansion of the Airport Industrial Park with several job-
Best Places for Jobs, CNNMoney.com, December 2009; #5 ready sites created.
in Forbes ranking of the Top College Towns for Jobs in May With the exception of the new $60 million retail center
2009; #7 in Forbes Best Places for Business and Careers in Portage Crossing, a City of Cuyahoga Falls/Stark Develop-
Metropolitan Area March 2009; #1 city in North Dakota for entrepreneurial start Metropolitan Area
ment collaboration, there has been no retail development.
Economic Overview ups, according to Business Week; #8 in MSN and Career- Economic Overview We are seeing absorption of vacant space, but retail
2010
Builder.com's October 2008 list of the 25 Best Markets to 2010 vacancies remain at higher-than-normal rates. The office
Population 202,746 Find a Job; #24 out of the Top 100 Best Places to Live and Population 704,084 market continues to experience higher-than-normal vacancy
Launch a Business, according to Fortune Small Business in rates with little positive absorption and existing tenants
2015 Estimated April 2008 and #9 in "America's Top 50 Business Opportunity 2015 Estimated
primarily downsizing or negotiating for longer-term current
Population 218,223 Metros for 2007" by Expansion Management Magazine. Population 701,641
rates. The industrial market is less active with little net
Employment Special mention should be made of the merger between Employment absorption and the majority of vacancies tied to larger,
Population 116,780 Meritcare and Sanford as well as the large projects completed Population 336,323 100,000 SF to 150,000 SF spaces. Lease rates are down
Household
by NDSU downtown and the Davies High School project from overall, but trending upward as properties are absorbed.
Household
Average Income $61,107 the Government sector in 2010. Average Income $67,431 Regarding rates and sales in the marketplace, sales
continue to be off primarily due to the current banking
Median Median
situation. Lease rates in the area have tended to stay at the
2009 rate, but we have seen some positive signs which
Total Population Total Population should show them stabilizing and starting to creep upward.
32 39
Fargo At A Glance Akron At A Glance

RETAIL RETAIL

Office in CBD $ 391,040.00 $ 696,960.00 Office in CBD $ 350,000.00 $ 525,000.00
Residential $ 20,500.00 $ 54,450.00 Residential $ 15,000.00 N/A

Canton, Ohio Cincinnati, Ohio
The commercial real estate market in Canton has remained The Greater Cincinnati/Northern Kentucky commercial real
relatively stable in 2010. Located just 60 miles south of estate economy includes the counties of Butler, Hamilton,
Cleveland, Canton offers businesses an educated labor force Warren, Clermont, Brown, Campbell, Kenton, Boone, Bracken,
and low cost of living. Canton’s growth during 2010 Gallatin, Grant, and Pendleton. Diversified with a well-edu-
centered on further expansion of the Akron Canton Regional cated labor pool and easy access to international markets,
Airport, education, medical and distribution. The retail greater Cincinnati is an active market for aerospace, automo-
market also started to pick up in Q3 from previous quarters. tive, biotechnology, creative services, chemistry, finance, IT
The office markets in both the downtown and suburban and consumer goods. Cincinnati is known for its largely
areas continued contracting. traditional core values, world-class arts, culture, education,
Much of the industrial and distribution continues to be healthcare, recreation and sports.
centered on the Akron Canton Airport area. However, in Within 600 miles of over half the nation’s population, Cincin-
2010 there was also growth on the south side of Canton at nati is a thoroughfare of goods to market. The 2011 industrial
the newly opened Mill’s Industrial Park. Medline Industries market should see an increase in activity not observed since
purchased 18.9 acres of ground and completed construc- 2007. Further credit loosening will accelerate pent-up
tion of a new 300,000 SF distribution center. Old Dominion demand. Employment reports are respectable for industrial
Freight also purchased 15 acres for construction of a new job growth in the market. New construction should be limited
Contact distribution facility. Contact to preleased build-to-suit projects for very specific users.
NAI Spring NAI Bergman Predictably, sales volumes have increased as pricing has
Office continues to be the market with the most opportuni-
+1 330 966 8800 +1 513 769 1700 become more favorable. Rental rates in many counties have
ties for purchasers. With an abundance of office space avail-
able in both the downtown and suburban markets, buyers bottomed out and are beginning to firm up.
are purchasing properties well below the cost to build. There The office market vacancy rates stabilized during 2010,
was very little new construction in the office segment during providing optimism for 2011. The CBD opening of the Queen
2010 because of the amount of existing space currently on City Tower and move-in of anchor tenant Great American
the market. Insurance will initiate a vacancy ripple effect. Rates should
Technology and education are thriving in the Canton area. decrease to accommodate the new additional space and
Stark State College announced an investment of $20 million activity will increase as tenants reshuffle space.
Metropolitan Area with the expansion of two academic buildings. The fuel Metropolitan Area In the suburban market, Tri-County market vacancy is still high
cell program at Stark State College also continues to drive Economic Overview
while other submarkets withstood the downturn reasonably
Economic Overview companies into the area from all over the world. Walsh, well. Vacancy rates continue in the single digits in Kenwood
2010 Malone and Mount Union Universities are all on the rise and 2010 and Union Center. The once vibrant Blue Ash market is active
Population 410,813 undergoing expansion projects. Retail vacancies were down Population 2,180,823 although not at previously high levels. The office employment
in 2010 with many existing, older retail spaces being highly 2015 Estimated
market is predicted to slightly lag the overall U.S. which may
2015 Estimated
Population 411,630 sought after for non-traditional retail uses such as adult day Population 2,267,477 impede absorption. Construction is limited to very specific
care, office and telemarketing centers. projects minimizing the impact of new delivery.
178,304
2011 looks to be a great year for buyers and tenants of Population 1,010,787 The lone notable 2011 retail project is The Banks in the CBD
Population
office space. Airline consolidation will have a big effect on on the Ohio River. The mixed-use, 3 million SF project of
Household the future of industrial and technology parks around the Household residential, specialty retail, office and hotel is scheduled to
Average Income $60,586 Akron Canton Airport. Limits on new construction over the Average Income $72,641 open in spring 2011. Top 2010 Cincinnati leases included
next year should keep the market relatively stable with slight Median
Morris Home Furnishings (87,235 SF) and Star Lanes on the
Median
absorption of vacant space across all sectors. Household Income $58,606 Levee (24,000 SF). Top 2010 sales included Governor’s Pointe
($27.5 million) and 600 Cincinnati Mills Dr. ($10.5 million).
37
Canton At A Glance Cincinnati At A Glance

RETAIL RETAIL


Cleveland, Ohio Columbus, Ohio
After a couple of tough years, the Cleveland real estate Columbus leads the state in job growth, population growth
market began to stabilize in 2010. Although the manufac- and new development, due in large part to being the state
turing and banking/finance segments are still sorting capital, and home to the Ohio State University, Battelle
through the dramatic economic shift that has occurred since Memorial Research Institute, health industry leader Cardinal
2007, job losses have stemmed and activity levels have Health, Nationwide Insurance and the Limited Brand family
showed signs of increasing. This has translated into a small of stores. Major hospital systems Ohio Health, University
but growing volume of tenant activity across much of the Hospitals and Mount Carmel Health Systems continue to
office and industrial sectors. compete for market share with new office development and
The CBD remained healthy. Total vacancy was about 20%, the addition of hospital beds.
with vacancy in the Class A market around 11%. The next Light office demand has resulted in mixed office absorption
couple years will be critical to the office market, both results. Downtown Class A product showed positive net
downtown and across the region. Two much-anticipated absorption at the expense of the Class B product, whose
public/private CBD developments will move off the drawing occupancy level fell. In the suburbs, the opposite story
board: a medical mart and convention center, expected to played out, with Class B product outperforming Class A
be completed in 2012; and a new casino, expected to be office buildings. Rental rates fell in all office markets as a
completed in 2013. Aside from these projects, private result of landlords aggressively chasing tenant renewals.
Contact development remained scarce. This void was filled by robust Contact Many office leases had rates reduced and terms extended,
NAI Daus medical and educational sectors, which collectively had NAI Ohio Equities, LLC as tenants took advantage of landlords hoping to stabilize
+1 216 831 3310 $1 billion in developments. These included multiple projects +1 614 224 2400 assets that would need refinancing in the next few years.
by the Cleveland Clinic, University Hospitals and Cleveland Landlords offering gross leases continue to see the most
State University, among others. leasing activity.
The industrial segment stabilized with static vacancy, firming All segments of the warehouse market continue to stagnate,
rents and a positive leasing velocity. These factors were well with vacancy increasing about 6% in bulk warehouse and
balanced by a lack of new development, due to an overall manufacturing space. Interest from national retailers for new
tentativeness among businesses coupled with a continued development has slowed substantially. Fast food is the only
lack of liquidity within the lending market. The retail segment segment of the retail market with new store growth. Retail
remained behind the pace set by the industrial and office rates have fallen across the board, and by as much as 25%
Metropolitan Area segments. However, the string of retail tenant bankruptcies Metropolitan Area or more for the most expensive space.
Economic Overview dramatically slowed as the segment began to reposition Economic Overview
Residential development of all kinds is virtually non-existent,
2010
towards a much-anticipated recovery. Investment sales 2010 with the exception of a few market apartment buildings
Population 2,110,340 remained scarce, but the much-ballyhooed crash in the Population 1,812,382 being developed. Single-family developers continue to pick
commercial sector failed to materialize. up undeveloped blanks from lenders and competitors who
Population 2,082,983 Looking forward, we expect acceleration in activity. This will Population 1,897,988 hope to resume building once the existing inventory starts
most likely be led by industrial. The office sector will benefit, to be absorbed.
Employment as the financial markets should be sorted out, allowing Employment
Cap rates for all types of investment product seems to have
Population 957,266 improvements within this segment as well as much-needed Population 874,538
stabilized. Properties that had been trading at 7% capital-
Household
liquidity across all sectors. The retail sector will likely be the Household ization now hover around 9%. The central Ohio economy
Average Income $67,395 last to recover, as its recovery will be hinged to an increase Average Income $72,348 continues to chug along with the bulk of activity being
in job creation and consumer spending, both of which are generated by local operators not pulled down by economies
Median not expected to occur in earnest until mid-2011. Median
outside our region.

40 36
Cleveland At A Glance Columbus At A Glance

New Construction (AAA) NA NA NA NA New Construction (AAA) N/A N/A N/A N/A
RETAIL RETAIL
Downtown N/A N/A N/A N/A Downtown N/A N/A N/A N/A


Dayton, Ohio Oklahoma City, Oklahoma
The capital markets have been selectively loosening tight
Oklahoma City concluded 2010 with unemployment at 7%,
credit, but fears of future market instability and non-performing
one of the lowest rates in the country and about level with the
loans persist.
surrounding areas this year. Oklahoma City experienced
Core assets and distressed assets have accounted for the slowed growth in 2010, but has witnessed a strong oil and
majority of sales in 2010 with the assets in the middle gas industry and growth at Tinker Air Force Base. Oklahoma
garnering little attention. The recession has increased vacancy City expects growth in 2011 with the average income at 17%
rates in the industrial and office sector, while the retail sector above average expenses.
vacancy has held its own.
The retail market gained strength in 2010 with net absorption
The Dayton office market ended Q3 2010 with a vacancy rate for the year at 250,004 SF. Average vacancy is 7.1% and
of 12.8%, which was a reduction from the previous quarter, but average rental rates are $10.42/SF. The Class A rates range
an increase over 2009’s rate of 11.7%. There was positive from $21-$25/SF, Class B ranges from $10-$13/SF and Class
absorption of 107,970 SF. Rental rates ended Q3 2010 at C ranges from $8-$10/SF. New construction added 210,000
$14.42/SF, a decrease over the previous quarter and 2009’s SF in 2010. Big news for 2011 is the construction of a
rate of $14.64 SF. There were no properties under construction 310,000 SF outlet mall on the west side of Oklahoma City
in Q3 2010. The largest lease signing was for 15,952 SF by under development by Horizon Group Properties. The project
Strayer University at Wright Executive Center. is expected to be completed by December 2011.
Contact Contact
The Dayton industrial sector ended Q3 2010 with a vacancy Oklahoma City’s office market remains strong with overall
NAI Dayton rate of 14.1%, which was a reduction from the previous quarter, NAI Sullivan Group
vacancy at 9.4%, showing positive absorption of 194,026 SF
+1 937 294 7777 but a significant increase over 2009’s rate of 9.6%. There was +1 405 840 0600
from Q2 2010. Class A rates average $18.50, Class B $14.37
positive absorption of 348,703 SF in Q3 2010. Rental rates and Class C $11.75. All rates are quoted as full service rates.
ended Q3 2010 at $3.48/SF, a decrease over the previous Rates and vacancies have remained level during 2010 and
quarter and 2009’s rate of $3.68 SF. Zero SF were delivered we expect rates will firm up and increase a modest 2-3% in
in Q3 2010 with 1,557,239 SF currently under construction. 2011. There has been negligible new construction during
The largest lease signing was for 65,385 SF signed by IMI 2010 with the big news being the construction of the Devon
Norgen, Inc. at 325 Carr Drive. Energy corporate headquarters building in the CBD. The
The Dayton retail sector ended Q3 2010 with a vacancy rate 53-story tower will add 1.5 million SF to Oklahoma City’s
of 9.2%, which was a reduction from the previous quarter and downtown skyline. Devon will use the entire building and
Metropolitan Area Metropolitan Area vacate 700,000 SF in the CBD.
2009’s rate of 9.4%. There was positive absorption of 237,986
Economic Overview SF in Q3 2010. Rental rates ended Q3 2010 at $9.34/SF, an Economic Overview The industrial market remains strong with overall vacancy at
2010 increase over the previous quarter and an increase over 2009’s 2010 the end of 2010 at 8.3%, up 0.1% for the year. Rates for flex
Population 840,896 rate of $9.25/SF. Very little new space was delivered in Q3 Population 1,242,888 space remain stable at $6.80/SF, up from $6.40 at the
2010 with 113,568 SF currently under construction. beginning of 2010 and bulk warehouse space averaging
Population 835,829 Population 1,324,545 $3.67/SF, up from $3.63 at the beginning of 2010. No notable
construction of bulk or flex warehouse space was delivered
Employment Employment to the market in 2010. There currently is only 30,000 SF
Population 368,404 Population 526,499 of new speculative construction anticipated for 2011.
Household Household
Median Median

39 36
Dayton At A Glance Oklahoma City At A Glance

Premium (AAA) $ 16.25 $ 18.94 $ 17.55 23.50% New Construction (AAA) $ 21.00 $ 23.00 $ 22.00 15.30%
RETAIL RETAIL


Tulsa, Oklahoma Portland, Oregon
Tulsa's market continues to find stabilization from the Slow job growth plagued the Portland metropolitan area in
prolonged weak economic conditions. With a late entry in 2010, with unemployment above 10% for the majority of the
2009 to the ongoing national economic downturn, in 2010 year. So it is very encouraging that Intel, Oregon’s largest
Tulsa saw rising unemployment, tightened credit and overall employer, announced it will spend billions of dollars upgrading
uncertainty. On a positive note, Tulsa's market seems poised two Portland-area factories and building a new one, set to
for rebound in 2011 with energy and manufacturing open in 2013. Intel’s continued investment in the region is
employment leading the way. good news for the high-tech, manufacturing and construc-
The office market is faring well during this prolonged down- tion sectors, as well as the overall job market. Portland also
turn. The vacancy rates for the CBD remain highest at continues to attract athletic apparel and shoe companies,
24.9% while the suburban market remains the strongest such as the British shoe company Hi Tec, which will relocate
sector with higher class buildings achieving $15-$20/SF its U.S. headquarters to Portland.
rents. The overall office market is maintaining a 76.4% Portland’s suburban office market struggled in 2010, with
occupancy rate in a 21.2 million SF market. decreasing rental rates and increasing vacancy, but Central
The retail market saw its toughest period in 2009 and has City remains fairly healthy, especially for Class A space.
actually seen a decrease in vacancy to 12.9%. Rental rates Shorenstein’s First & Main, a 350,000 SF LEED-Platinum
have decreased yet occupancies in newer power centers office building that delivered in Q1 2010, was entirely leased
Contact Contact up by the General Services Administration and PECI.
built in 2007-2008 have been bolstered by national tenants
NAI Commercial NAI Norris, Beggs The historic 133,260 SF Meier & Frank Building was leased
stabilizing nationwide, limited new construction and growing
Properties & Simpson by Vestas, the Dutch wind turbine company, for its North
tenant confidence. Weighted average rents for Tulsa retail
+1 918 745 1133 +1 503 223 7181 American headquarters. It will remain challenging to find
centers are at $11.92/SF.
large Class A floor plates in the CBD.
The industrial market in comparison has softened more than
other sectors with a 10.4% vacancy for a 60 million SF market The industrial market is stable, with vacancy leveling off.
(8% in 2009). Rental rates have decreased to $3.94/SF Portland’s robust cluster of renewable energy companies,
in bulk warehouse and $6.48/SF in service center spaces. such as solar panel manufacturers, is attracting more of
Industrial building vacancy inventory should see stabilization these businesses that require industrial space to the area.
in 2011 if larger bulk warehouse spaces at 26% vacancy The 415,000 SF FedEx Ground facility at Troutdale Reynolds
can be refilled. Industrial Park delivered, leaving few industrial projects
Metropolitan Area Metropolitan Area under construction.
Economic Overview Investment/land sales have dropped in half from pre-recession Economic Overview
years in Tulsa. While hospitality and multifamily development Retail vacancy has declined to below 7%. Though the closure
2010 remains flat, various big box retailers such as Target (South 2010 of Saks Fifth Avenue was a blow to downtown’s Pioneer
Population 941,253
Town) and Sam's Club (Tulsa Hills) have helped fuel retail
Population 2,255,276 Place, H&M leased a portion of the space. H&M, Saks Fifth
land sales to their respective markets. Downtown Tulsa’s Avenue Off Fifth and Nordstrom Rack also announced new
Population 981,729 recent success with the new BOK Center and OneOk Population 2,412,000 stores in Portland’s suburbs. Retail construction picked up,
Baseball Field has paved the way for two major mixed-used including work on the long-awaited Progress Ridge Town
Employment
development announcements totaling 500,000 SF, the One Employment Square in the Beaverton-Tigard area.
Place and Civic Center developments. Tulsa's fundamentals The multifamily rental market improved during the second
Household remain strong and with stabilizing occupancies and growing Household half of 2010, with vacancy rates dropping to below 4% for
Average Income $61,891 consumer confidence, the market should find itself putting Average Income $74,960 the first time in two years. The apartment investment market
the recession in the rear view mirror in 2011. also picked up, as a number of properties originally devel-
Median Median
Household Income $49,283 Household Income $61,823 oped as condominiums came on the market and were sold.
Although challenges remain for the Portland metro area
Total Population Total Population economy, the long-term prospects for commercial real estate
37 36
Median Age Median Age are good, and significant recovery should occur in 2011.
Tulsa At A Glance Portland At A Glance

New Construction (AAA) NA NA NA NA New Construction (AAA) $ 29.00 $ 39.00 $ 32.75 N/A
RETAIL RETAIL
Downtown $ 6.00 $ 18.00 N/A N/A Downtown $ 12.00 $ 85.00 $ 26.00 9.30%
Regional Malls $ 20.00 $ 40.00 N/A N/A Regional Malls $ 14.00 $ 40.00 $ 22.00 6.80%


Allentown/Bethlehem/Easton, Pennsylvania Berks County, Pennsylvania
The Lehigh Valley, located in eastern Pennsylvania, offers all Growth sectors include Food Processing, Plastics, Specialty
of the amenities of major urban areas. The Lehigh Valley is the Metals and Battery Manufacturing. Medical and institutional
third largest region in Pennsylvania. It is well situated, 95 miles services are key drivers in the office sector with technology-
to New York City and 53 miles north of Philadelphia. The based businesses quickly emerging. Private/public partner-
Lehigh Valley is an excellent location for business and ships are effectively linking the Penn Corridor from Reading to
industry. The Lehigh Valley has 11 higher learning institu- Wyomissing. Watch for a Technology Park to be developed at
tions and nationally recognized healthcare facilities. the Reading/Berks Airport and the emergence of Bryne Eyre,
The area consists of an enterprising and diversified economy a 3,000-acre PRD at the I-176 and PA Turnpike interchange.
that has led to higher-income jobs, a growing and thriving Medical and institutional users are key office drivers with
population and tremendous commercial and industrial less than 0.5% growth coming from new construction.
growth in the region. The Lehigh Valley is home to some of This is the third year of overall negative absorption, -2%
the world’s top corporations in a variety of fields, including in 2010. The downtown market accounts for most of this
Air Products and Chemicals Inc., B. Braun Medical Inc., with Wyomissing/Spring Ridge outperforming all other areas.
Binney & Smith, Olympus and many others. Overall rates have slid a modest $0.75/SF and quality down-
Excellent transportation access also exerts an important town space can be found at $10/SF gross, which should bring
influence on the Lehigh Valley. The most important highways deals in from the suburbs. Developers have 600,000 SF of
Contact Contact office space planned and approved just waiting for demand.
are Route 22, Interstate 78, which connects the Lehigh
NAI Summit NAI Keystone
Valley with Harrisburg to the west and New Jersey to the Industrial vacancies have risen for the third year with
+1 610 264 0200 Commercial & Industrial
east, and major roadways such as Interstate 81 and 83 to 6.8 million SF currently available. Only 86,000 SF of new
+1 610 779 1400
the north. Route 22 provides fast, limited access between product was added and the market had negative absorption
Allentown, Bethlehem, and Easton. The Extension of the of 789,000 SF comparing with a negative absorption in
Pennsylvania Turnpike and Route 309 can also be access excess of 1 million SF in the prior year. Lease rates are down
off Route 22 and Interstate 78, which connects Philadelphia slightly with landlord concessions routine. Gross sale of in-
with Wilkes-Barre and Scranton areas. The area is also dustrial product was down $8 million over the prior year to
served by the Lehigh Valley International Airport. $15 million total. Sale prices were down only slightly with a
The Lehigh Valley remains an attractive market to investors, range of $49/SF for Class A product to $22/SF for Class C.
Metropolitan Area importers, exports, manufacturers and high-tech compa- Metropolitan Area The number of residential units sold is up 9% but average
nies. Developers, enticed by abundant land, favorable taxes, sale prices are down 6% from the prior year. Developers
the lure of railway access and infrastructure, continue to continue to sit on projects with over 2,000 approved but
2010 secure land positions along the Route 22 and Interstate 78 2010 unimproved lots ready.
Population 822,160 corridors. Rental rates in all markets are competitive and Population 629,627
Notable retail projects include the 61,000 SF Spring Market
have remained relatively stable. The industrial and health- Center (82% leased) and the 400,000 SF, $75 million
Population 855,128 care markets continue to be one of the nation’s largest Population 633,660 Super Wal-Mart anchored Tilden Center (65% leased).
growth areas. Modern shopping malls, big-box and lifestyle Planning has slowed for large centers but continues for
Employment centers remain popular. Several developments have recently Employment
pharmacies and convenience stores. Bank branch growth
Population 378,522 been completed, including Plaza on 8th in Bethlehem and Population 78,790
has been flat. The BOSS 2020 program is projected
Household
Crossroads in Nazareth along Route 22. Household to enhance the traffic flow and boost retail/commercial
Average Income $70,433 Average Income $97,711 development in Sinking Spring.
Median Median

41 41
Allentown/Bethlehem/Easton At A Glance Berks County At A Glance

New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 15.00 $ 18.00 $ 17.00 N/A
RETAIL RETAIL


Bucks County, Pennsylvania Harrisburg/York/Lebanon, Pennsylvania
The Bucks County industrial and office marketplace is well With large influences from manufacturing and medical
diversified and with any luck has seen the worst of this sectors, Central Pennsylvania’s keystone area has stabilized
economic crisis. Bucks County is well situated for any and is showing signs of improvement. Harrisburg-York-
company to service and distribute along the Interstate 95 Lebanon is home to many high profile companies, including
Corridor from Florida to Maine. The manufacturing climate is Hershey Foods, Rite-Aid, HARSCO, Graham Packaging
ideal, featuring unparalleled economic incentive packages and and Giant Foods. These large players, coupled with a
a skilled workforce. Quality of life is excellent with its close strong governmental sector, are showing signs of slow but
proximity to Philadelphia, New York City and Atlantic City. continued positive economic movement.
The Bucks County industrial market outperformed its Limited new construction has allowed the office market
neighbors this year with a positive net absorption. Inven- sector to stabilize and vacancy rates have decreased by
tory for lease remains readily available while properties for small amounts. Downtown and suburban office space data
sale were in greater supply than the previous year. Sale shows tenants are taking advantage of lower rental rates
prices declined another 10% and lease rates became and are continuing to move out of oversized lower quality
more competitive with aggressive landlord concessions. space and into right-sized Class A space. Companies
Bucks County continues to receive interest on a global including BNY Mellon are moving up in the Downtown office
basis as heavy manufacturing/high-tech/alternative energy market while Comcast and Oven Industries have upgraded
Contact companies seek economic incentives for power, rail and Contact in the suburban market.
NAI Mertz port, offered within The Keystone Industrial Port Complex NAI CIR
There remains some concern regarding the pace of the
+1 215 221 1100 (KIPC) in Morrisville. The Bucks County industrial market- +1 717 761 5070
economic turnaround and its effect on absorption and rate
place totals approximately 50 million SF. The vacancy rate increases. Accordingly, speculative and new construction
increased another 2% from last year to total 11% taking starts will remain modest at best. The Downtown retail
into account all sublease opportunities. market remains steady with neighborhood retail properties
NAI Mertz is working with NAI Global as exclusive agent showing slightly decreasing rental rates to align with static
for the KIPC. It was designated a Keystone Opportunity demand. High profile commercial users, including Sheetz,
Improvement Zone adding 1,259 acres of heavy industrially CVS, Rite Aid and numerous financial institutions continue
zoned land with port/rail facilities to the 44,000 acres of to pursue select in-fill development and renovation oppor-
developable land designated within Pennsylvania’s a tunities on high-traffic corridors. Value players continue to
Metropolitan Area Keystone Opportunity Zones throughout the state. KOZs, Metropolitan Area look for opportunistic leasing of large second-generation
Economic Overview KOEZs and KOIZs are areas offering companies special tax Economic Overview centers. Wolfs Furniture recently completed a deal to
2010
exemptions and abatements on real estate, state and local 2010
move into 50,000 SF in Mechanicsburg’s Gateway Square.
Population 410,288 taxes as well as priority for state and local financing Population 1,105,352 Newly developed large scale suburban retail is limited to
programs to locate within a designated KOZ. Koch Development’s opening of the Wal-Mart anchored
2015 Estimated
Notable transactions and newcomers to our market include 2015 Estimated shopping center in Newberry Township, York County.
Population 423,025 Population 1,146,408 Regional malls continue to lower rental rates as induce-
the lease of 161,000 SF of industrial space by CSC Sugar
Employment and 77,000 SF by GMA Garnet, both within the KIPC; Employment
ments to extended terms.
Population 183,832 and 148,000 SF leased to Interstock Premium Cabinetry in Population 535,965 Large bulk warehousing continues to show slightly decreas-
Household
Bristol. Matrix Development sold 100 acres in Langhorne Household
ing rents to entice movement and secure long term tenants.
Average Income $66,223 previously slated for an office/flex campus to Toll Brothers Average Income $65,898 Overall vacancy has remained constant but is showing
for a 335-unit senior housing development. positive absorption in the 100,000 SF to 350,000 SF range.
Median
The office market is still experiencing negative absorption
Median National tenants, including Lennox Industries, Clark Group,
Household Income $58,095 Household Income $56,879 Syncreon and Nestle Purina have established regional
and slow leasing activity. However, we anticipate there will
Total Population be a turnaround in the office market in 2011. Total Population
centers in this range within the past year.
40 41
Bucks County At A Glance Harrisburg/York/Lebanon At A Glance

RETAIL RETAIL
Neighborhood Service Centers N/A N/A N/A N/A Neighborhood Service Centers $ 6.00 $ 20.00 $ 13.00 12.00%
Community Power Center N/A N/A N/A N/A Community Power Center $ 12.00 $ 25.00 $ 18.00 12.00%

Retail/Commercial Land N/A N/A Retail/Commercial Land $ 250,000.00 $ 1,750,000.00

Lancaster, Pennsylvania Philadelphia, Pennsylvania
Lancaster’s real estate market continues to expand as a Philadelphia County continues to receive interest on a global
direct result of its strategic location, diverse economy, basis as heavy manufacturing, high-tech, drug and alternative
competitive workforce and its desirability as a place to live energy companies seek labor, power, rail, port and economic
and work. Overall, property values and lease rates have incentives offered specifically within The Philadelphia Naval
remained consistent over the last 12 months and are antic- Yard and other industrial sites under the control of the
ipated to remain stable throughout 2011. Philadelphia Industrial Development Corporation. With the
The downtown CBD continues to benefit from the recent quality of life and excellent location, Philadelphia is within
opening of the Lancaster Convention Center and Marriott one day’s drive of 40% of the U.S. population.
Hotel. Other notable projects include the redevelopment of The PIDC coordinates marketing efforts to stimulate job
the former Armstrong World Industries and Norfolk Southern growth within the city limits. The Naval Yard was designated
sites by Franklin & Marshall College and Lancaster General a KOIZ adding 1,200 acres of industrially zoned land with
Hospital into an 80-acre campus for medical, research and port and rail facilities. The Naval Yard has approximately 150
development, educational and recreational uses. As well, acres remaining for sale or lease targeting research and
the redevelopment of the former Lancaster Stockyards into development companies. KOZs, KOEZs and KOIZs are areas
a 20-acre business park has been finalized and construction that offer companies special tax exemptions and abate-
completed for its first two tenants, CoreSource and Cargas ments on their real estate, state and local taxes as well as
Contact Systems. The office market continues to see modest absorp- Contact priority for state and local financing programs.
NAI Commercial tion with the largest vacancy rates in Class B and C properties. NAI Geis Realty
Notable transactions this year within Philadelphia include
Partners Inc. Group, Inc.
Industrial occupancy levels are generally constant and lease the sale of 30.9 acres to DP Partners for a 250,000 SF
+1 717 283 0600 +1 215 568 7222
rates have stabilized at a slight discount from peak market build-to-suit for Penn Jersey Paper. The USPS sold its
rates. Land values for prime commercial and office sites NAI Mertz
206,000 SF building to Philadelphia International Airport to
continue to command premium pricing but limited demand for +1 215 221 1100
accommodate the Airport’s proposed expansion plans.
industrial sites has kept land values flat in that segment of the Philadelphia County retail activity was a mixed bag in 2010.
market. Retail occupancy levels dropped from previous report The Suger House Casino opened in September and retail
levels, primarily in smaller tenant space. Recent projects demand continues at a fair pace for well-located opportunities,
include the opening of Mill Creek Square with Kohl's, but rental rates continue to decline throughout the market and
Bed Bath & Beyond, Ross and Christmas Tree Shops. A high tenant concessions remain the catalyst for getting deals done.
Metropolitan Area profile site of 70 acres adjacent to Red Rose Commons, the Metropolitan Area
Economic Overview only retail power center in Lancaster, is under agreement Economic Overview The Philadelphia office market is believed to be at the bottom
for future mixed-use including retail. Target is planning a of the economic cycle with projections to remain there for a
2010 2010
construction start in 2011 in Lititz, the retailer's second period of time. Unemployment is basically unchanged, and the
location in the county. industries that drive office space absorption, professional and
2015 Estimated 2015 Estimated business services, are just not hiring.
Population 525,934 Looking ahead, we anticipate the local market will continue Population 5,931,875
to benefit from the overall economic recovery. As property Investment activity is weak as values and uncertainty
Employment values and lease rates are positively influenced by this Employment continue to challenge the market. One recent significant
Population 250,042 continued growth, we expect a steady demand for new proj- Population 2,653,674 transaction illustrates the market. Brandywine Realty Trust
ect development in Lancaster County. recently purchased 1717 Arch Street for $129 million from
Household Household Blackstone, who paid $222 million for the same building
in 2003.
Median Median

38 39
Lancaster At A Glance Philadelphia At A Glance

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Pittsburgh, Pennsylvania Schuylkill County, Pennsylvania
The Pittsburgh region continues to experience strong growth Located in the heart of anthracite coal country, Schuylkill is
and is garnering national applause from all over the country. shaking off its coal roots to emerge as a service, technology
With unemployment two points below the national average, and small business based economy. Pottsville is the market’s
Forbes.com ranks Pittsburgh second nationally in terms of largest city and anchors the medical system, professional and
prosperity and cost of living. Moody’s ranks the Pittsburgh governmental offices and is also home to Yuengling, America's
commercial real estate market fifth nationally and states Oldest Brewery.
that the multifamily market enjoys a 2.4% vacancy rate, the The office market is dominated by healthcare and govern-
lowest in the country. mental agencies with few leases or sales above 5,000 SF in
In terms of job creation, Pittsburgh ranks 10th according to size. New home construction is almost nil with sales tracking
the U.S. Bureau of Labor Statistics. Finally, CNBC states that steady from 2009.
the cost of living in Pittsburgh is 12.2% below the national Industrial activity favors the HighRidge Business Park along
average. The main sectors driving Pittsburgh’s 21st century I-81. New companies include Fed Ex opening a 32,000 SF
resurgence are businesses involved in drilling for gas from DC in Auburn. Locust Ridge Wind Farm picked up an ARRA
the Marcellus Shale formation and the continued growth $59 million financing grant to build a new 102 megawatt
of Westinghouse Nuclear. These factors, along with the project. ARRA also funded $20 million in water/sewer and
technology sector, which has benefited from Google’s $27.5 million in Highway infrastructure upgrades. Future
Contact commitment to Pittsburgh’s East End, have worked hand in Contact
growth includes the Pro Logis proposed 850,000 SF building
NAI Pittsburgh Commercial hand with growth from the City’s colleges and universities. NAI Keystone Commercial
with permits complete and ready for construction.
+1 412 321 4200 Institutions such as the University of Pittsburgh, Carnegie & Industrial, LLC
Mellon, Robert Morris, Point Park, Duquesne and Chatham +1 610 779 1400 Retail construction and leasing was cool through 2010 with
Universities have made invaluable contributions to the city. several prime locations vacant and those along the Route 61
Corridor continuing to be highest in demand. Positive
Home to seven Fortune 500 companies, such as Federated economic impact is being experienced from the Marcellus
Investors, Alcoa, USX, Bayer, Rand and Google, these com- Shale business primarily on the north side of the County. The
panies provide an infusion of capital and employment crucial new $17 million Intermodel Center in Pottsville is slated to open
to the city’s continuing development. The financial sector in 2011. This will include a three story office building which will
also remains strong and has experienced growth, with the be home to the Visitors Bureau and will also support retail and
additional strong presence of First Niagara and Huntington office space.
Metropolitan Area National Bank to the Pittsburgh market, along with PNC Metropolitan Area
Economic Overview Corporation and BYN Mellon, who remain economic stalwarts. Economic Overview Industrial Development has been spearheaded by The
Schuylkill County Economic Development Office which
2010 Pittsburgh’s three major rivers, along with some of the 2010
manages 12 industrial parks located across the county
Population 2,368,989 largest inland ports in the nation, allow for the easy and cost Population 148,853
representing more than $1.1 billion in capital investment over
effective transportation of basic commodities such as steel, the next nine years.
Population 2,333,063 iron, natural gas, oil and coal. Pittsburgh International Airport Population 147,178
is ranked as one of the world’s best with direct flights to Schuylkill County, with its rural character and sparse
Employment many cities. This along with renowned sports teams such Employment population within its 779 square mile area, exemplifies
Population 1,124,913 as the Steelers, Penguins and Pirates, world class cultural Population 67,029 an essential quality of small town America; hard-working
venues and great outdoor recreational opportunities, allows people doing their utmost to improve their quality of life.
Household Household Now and again small packages produce big results. This is
Average Income $61,949 Pittsburgh to be annually ranked as one of the nation’s most Average Income $51,737
livable cities. definitely true here.
Median Median

43 44
Pittsburgh At A Glance Schuylkill County At A Glance

RETAIL RETAIL


Wilkes-Barre/Scranton/Hazleton, Pennsylvania Charleston, South Carolina
This area traditionally had been dominated by coal production Charleston is a three county region with a population of
and heavy industry. However, the excellent highway system 660,000 people. It is the 10th largest port in the nation by
that runs through Northeastern Pennsylvania–Interstates 81, container volume. It has two military bases-- Charleston Naval
80, 84, 380, 180 and the Northeast Extension of the Penn- Weapons Station and the Charleston Air Force Base--which
sylvania Turnpike–has transformed the region into the employ 20,000 people and anchor a cluster of military
epicenter for major companies to locate mega-distribution contractors. The region includes the state’s largest medical
centers to service the Northeast and Mid-Atlantic population school and three private hospitals. Charleston also is one of
centers, as well as for backroom office operations. the nation’s most significant tourist destinations providing
Over the past year, Northeastern Pennsylvania has seen a rise employment to thousands of people.
in activity due to a natural gas pocket located in a shale forma- Charleston has about 8.6 million SF of office space. Occu-
tion known as the Marcellus Shale. A number of companies pancy at mid year was 81.5%. Asking rents have fallen 10%
have been leasing subsurface rights from numerous landowners over the last year and landlords are providing concessions in
throughout the shale formation. Gas service companies have the form of free rent and tenant improvement allowances. One
been leasing land with rail and industrial properties to store pipe, 20,000 SF building is under construction in Mt. Pleasant and
sand, water, chemical and other materials used in developing a 63,000 SF building is planned for delivery on the Peninsula
the gas wells and supporting infrastructure. NAI Mertz has in 2011.
Contact formed an Energy Services team to work directly with natural Contact
The retail market has 20 million SF of inventory. Rents in
NAI Mertz of gas drilling companies and the companies that support their NAI Avant Charleston, LLC
Class A retail centers range from $15 to $23/SF. Rents in the
Pennsylvania HQ operation. The hospitality industry is benefiting from the needs +1 843 720 4944
Peninsula market range from $28 to $44/SF. Occupancy fell
+1 570 820 7700 of gas extraction employees coming to the area to work at market-wide by mid-year 2010 to 90%, largely as a result of
Marcellus Shale construction projects. several “big box” national tenants closing their stores. New
In 2010, consolidations have continued, although they have Harris Teeter grocery stores recently opened in Mt. Pleasant
slowed in comparison to 2009. Some companies are looking and West Ashley. Several other grocery anchored centers are
for additional space to accommodate recent growth in busi- ready to begin construction throughout the region.
ness. One example is a 60,000 SF expansion project for The industrial market currently has 24.5 million SF of space.
Boden, located in the Centerpointe Trade Park in Pittston, PA. Occupancy fell at year’s end to 93%. Rents have remained
The market is beginning to show signs of improvement with stable throughout 2010. New speculative product is under
Metropolitan Area absorptions decreasing area vacancy rates. Metropolitan Area
construction in anticipation of increased demand from port
Highlights in the market are Diapers.com leased space in the related industries when the Panama Canal deepening is
2010 Covington Industrial Park and the Boden expansion project. 2010 completed in 2013. Additionally, Boeing will begin production
Population 551,999 2010 also saw the opening of a 460,000 SF Home Depot Population 671,833 in July 2011 at its new facility adjacent to the airport employing
Distribution Center and the 396,000 SF Corning Life 3,800 people regionally.
Population 547,633 Sciences, both in the Centerpointe Trade Park. Prominent, Population 740,909 The hospitality industry has stabilized and occupancy is
national fast food chains invested in new locations (Sonic) and currently at 66.7% with an inventory of 17,600 rooms. New
Employment new prototypes (Arby’s), but restaurants as a group were one Employment developments that were delayed are beginning to move
Population 256,631 of the hardest hit segments of retail. Big box discount relocated Population 296,672
through the approval process with openings planned in early
Household
to newly available and superior locations. Speculation office 2012. Cruise ship dockings increased again in 2010 with up
Household
Average Income $55,590 construction has either received governmental incentives or is Average Income $62,916 to 104 per year expected in 2011.
on hold for signs of improved market conditions.
Median Median

44 36
Wilkes-Barre/Scranton/Hazleton At A Glance Charleston At A Glance

(Rent/SF/YR) Low High Effective Avg. Vacancy (Rent/SF/PY) Low High Effective Avg. Vacancy
High Tech/R&D N/A N/A N/A N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL


Columbia, South Carolina Greenville/Spartanburg/Anderson Counties, South Carolina
Columbia is a six-county region with a population of 740,000 Upstate market conditions improved in 2010 as the economy
people. It is the state capitol of South Carolina and the center continues to be driven by international corporations such
of the state government with nearly 25,000 employees. It has as BMW, Michelin and Fluor. A diverse range of companies
two military bases, Fort Jackson and McIntire Joint National announced plans to locate in the Upstate due to the
Guard Base, which collectively employ 10,000 people. The top-ranked business climate, low tax rates and world-class
region includes six universities that employ around 6,000 research facilities. Greenville has been recognized among the
people and is a regional medical center with three major “Best Places for Business and Careers” and the “Best Place
hospital systems, a VA hospital and medical school. to Live in the Country.”
Columbia has about 9.5 million SF of office space and has Office vacancy decreased to an average of 12% across all
experienced an average annual absorption of 70,000 SF. submarkets. This trend became evident as tenants began
Occupancy at midyear was 78.7% excluding the Palmetto to make decisions after several quarters of delay. Within the
Center, a 456,218 SF building that is largely vacant because CBD, tenant activity picked up with the additions of Clemson
of its condition and design. Landlords have dropped base University’s MBA Program, Greenville Hospital System and
rents 10% on average over 2009 figures and are providing the expansions of Brown Mackie College and the U.S.
additional tenant improvement dollars and free rent as Attorneys office. The new 65,000 SF Main at Broad office
concessions. Activity in 2010 has been steady with several building attracted several upgrading office tenants.
Contact leases between 20,000 and 50,000 SF executed, most in Contact
The industrial vacancy rate was static with a decline in lease
NAI Avant, LLC the CBD. NAI Earle Furman, LLC
rates for the first half of 2010. However, there are positive
+1 803 254 0100 +1 864 232 9040
The retail market has 22 million SF of inventory. On average, indications as we move into 2011. Despite a slight decline
about 370,000 SF are absorbed annually. Rents in Class A in rates, vacancy has decreased with a net absorption of
retail centers range from $16 to $24/SF. Occupancy rose just under 350,000 SF. The industrial sector continues to
by midyear to 87.9% as several of the “big box” spaces be widely automotive based. Proterra selected Greenville as
were filled with new tenants, many new to the market. the location to assemble and manufacture electric buses.
The industrial market has 28.8 million SF of warehouse Construction of the 240,000 SF facility located at CU-ICAR
space. Occupancy remained steady at 81.9%. Rents have is set to begin soon. Also, BMW completed a $750 million
remained stable due to the relatively small number of high expansion at its Greer plant.
Metropolitan Area
quality buildings that meet current market requirements. Metropolitan Area
Retail vacancy rates stabilized, while leasing activity is up
Recent developments include a 400,000 SF distribution and rental rates are about 5% lower than last year as land-
Economic Overview center for Home Depot, a 200,000 SF Republic National Economic Overview lords are motivated to make deals. Notable new retailers
2010 Distribution Center and a 176,000 SF multitenant warehouse 2010 include BuyBuy Baby and Trader Joe’s. The 500,000 SF
Population 758,492 in the Lexington County Industrial Park. Population 1,122,322 Easley Town Center project is under way with Wal-Mart
Activity in 2010 has increased dramatically from 2009 scheduled to open in spring 2011.
Population 820,439 particularly for office leasing and sales of office buildings to Population 1,205,725 Investment deals are being done today that were not possible
end users. Retail leasing continues to be slow although retail last year. With fewer quality assets on the market and so
Employment sales have been on the rise, albeit slowly. Industrial leasing Employment much pent-up equity on the sidelines, cap rates have
and sales continue to be slow with a large inventory of ware- remained steady or declined slightly. Transaction volume for
Household house space available, particularly in lower quality buildings. Household single tenant NNN properties has improved dramatically over
Average Income $64,371 Average Income $59,899 last year. As the economy and lending environment improve,
larger investors will re-enter second tier markets.
Median Median

36 38
Columbia At A Glance Greenville/Spartanburg/Anderson Counties At A Glance

(Rent/SF/YR) Low High Effective Avg. Vacancy (Rent/SF/PY) Low High Effective Avg. Vacancy
RETAIL RETAIL

Office in CBD $ 260,000.00 $ 1,300,000.00 Office in CBD N/A N/A

Sioux Falls, South Dakota Chattanooga, Tennessee
One of the fastest growing areas of the United States during Chattanooga continues to receive good economic news and a
the past decade, Sioux Falls’ strong metro territory has better market is forecast for 2011. Long noted as a great place
brought hundreds of businesses to the region. For the sixth to live, Chattanooga is now a great place to work mainly due
consecutive year, Forbes voted Sioux Falls first among U.S. to the 775,000 SF Volkswagen assembly plant under con-
cities with populations of 50,000-177,000 as the best place struction. When the cars roll out in 2011, the plant will deliver
for business. Sioux Falls was also voted #8 for 2009-2010 an immediate demand for 2,000 new employees and up to
as one of the 60 U.S. Hotspots for Young, Talented Workers 12,000 jobs created by tier-one and tier-two suppliers.
for cities with a population of 100,000-200,000. This is the first time in recent memory that there is an ample
The Sioux Falls office market inventory consists of approx- supply of quality industrial buildings in the 100,000 SF to
imately 9.5 million SF. Of that, 8.4 million SF is occupied, 250,000 SF range. Volkswagen recently built a 450,000 SF
resulting in a vacancy rate of 11.58% in 2010. The office supplier park onsite where most of the tier-one suppliers
vacancy rate has remained basically unchanged compared are locating. So it may be 2012 before the industrial market
to 2008 statistics. Industrial vacancies are at 4.03% and feels the VW affect and absorbs the available buildings.
retail vacancies are at 5.78%. The office market in the CBD still remains stagnant. Blue
Sioux Falls is said to be the largest retail option between Cross Blue Shield of Tennessee relocated to its new
Contact Minneapolis and Denver. The Shoppes at Dawley Village is Contact 950,000 SF corporate headquarters on the peripheral of
a 70-acre retail development that includes Target. Plans for downtown in 2009. Blue Cross vacated over 450,000 SF in
NAI Sioux Falls NAI Charter Real Estate
more national retailers are in progress. The CBD is under- three different buildings, almost doubling the vacancy. In fall
+1 605 357 7100 Corporation
going renovation and continues to add offices, restaurants 2010 Chestnut Tower, an 180,000 SF office building, was
+1 423 267 6549
and shops. The Sioux Falls industrial market felt the strain purchased and is undergoing a $20 million renovation. A
of the national economy in 2010 as decision makers local law firm has been secured as the anchor tenant. The
delayed any major decisions. The market is currently suburban market has two Class A office parks competing
experiencing a recovery of demand and anticipates a strong for tenants, which makes rates very attractive. Of the almost
year in 2011. To date, large tract development land sales 100,000 SF of vacancy, an estimated 40,000 SF has been
have come to a virtual halt with the change in the economic absorbed in the last 12 months.
conditions and sizable level of inventory. Prices for raw land Retail development is lethargic with no new projects
are definitely trending downward. announced since late 2007. The Hamilton Place Mall area
Many different styles of apartments are located throughout remains the driver and premier retail location with Northgate
the area; from historic lofts in the CBD to newer complexes Mall in the Hixson submarket a strong second. Downtown
2010 located in the outlying sections. The area's steadily growing 2010 activity is non-existent; however, the North Shore market is
Population 240,804 population has helped fuel demand. Population 527,743 active due to its public parks along the Tennessee River.
2015 Estimated Today, the community is experiencing growth and expansion 2015 Estimated Chattanooga promotes sustainable growth and with VW
Population 272,903 in the technology, healthcare, retail, construction and Population 550,725 pumping new life in the industrial sector, this combination
research sectors. Greater Sioux Falls has not experienced will create a healthy local economy. Downtown is alive and
119,822
the extreme lows of other markets, which has allowed one example of this is the recent announcement of the
Population Population 235,791
investors to enjoy consistency and reasonable returns MacClellan Building being converted to a boutique hotel by
Household benefiting from its stability. Household the Indigo Group.
Median Median

35 Median Age 40
Median Age
Sioux Falls At A Glance Chattanooga At A Glance

RETAIL RETAIL

Office in CBD $ 1,000,000.00 $ 1,500,000.00 Office in CBD $ 650,000.00 $ 1,200,000.00

Clarksville, Tennessee Knoxville, Tennessee
Clarksville is the fifth largest city in the State of Tennessee Knoxville’s economy has seen gradual improvement in
and the 17th fastest growing city in the United States. The city 2010. The fear and uncertainty that paralyzed the commer-
of Clarksville, adjacent to Fort Campbell Military Base, enjoys an cial real estate market in 2009 has eased significantly. Busi-
expanding and diverse industrial base, a vibrant residential nesses, developers and investors willing to make long-term
market and is home to Austin Peay State University. commitments, are still sparse. Activity for most improved
Hemlock Semiconductor Corporation, one of the world’s lead- property types has increased, although raw land continues
ing suppliers of polycrystalline silicon products, is currently to trade at wholesale prices. Asking prices and rental rates
constructing a $1.5 billion facility which will become opera- continued their slow decline across all sectors. We have yet
tional in late 2012. Conwood Corporation, a subsidiary of R. to notice an increase in rates in Knoxville.
J. Reynolds, recently purchased a one hundred ninety three The office sector continues to see shorter tenant commit-
acre site and will invest 130 million dollars expanding their ments. Landlords continue to lower rents, offer greater
existing operation in Clarksville. Other corporate citizens with tenant improvement allowances and increase free rent.
manufacturing facilities in Clarksville include The Trane Com- Tenant interest is up from last year but still well below
pany, Jostens, Bridgestone Metalpha, Florim, US Zinc and the interests levels in other property types. A major transaction
Robert Bosch Corporation. A new $200 million hospital facility for the area was a 24,804 SF medical office building that
was recently constructed and is operated by Community traded for $161/SF in June of 2010.
Contact Health System. Contact
The industrial sector has seen a major uptick in activity from
NAI Clarksville NAI Knoxville
Austin Peay State University is the fastest growing university in 2009. However, like the office sector, the majority of tenants
+1 931 648 4700 +1 865 777 3030
the Tennessee Board of Regents system with enrollment prefer to make short-term commitments even though
exceeding 10,000 students. APSU offers 57 majors allowing some submarkets offer historically low rental rates. The
students to earn a bachelor’s, master’s or education specialist’s industrial sector remains the most active in the Knoxville
degree. In addition, the university boasts two accomplished market with a 72,600 SF industrial building trading for
Centers of Excellence and four Chairs of Excellence. $36/SF in February of 2010.
There is a good supply of new land available for retail, office, The retail sector in the Knoxville MSA has been depressed
industrial and residential development. Land prices are typi- with high vacancy rates and tenants seeking rent reductions
cally lower than those found in comparable markets. Currently in 2010. Prime locations continue to lease but with free rent
there is a shortage of warehouse space primarily resulting and increased tenant improvement contributions from the
Metropolitan Area from the entrance of Hemlock Semiconductor and related sup- Metropolitan Area landlord. National credit tenants are being replaced in many
Economic Overview pliers into the market. Construction of retail space has slowed Economic Overview instances by local tenants as a temporary relief from existing
2010 due to the national economy. However, Clarksville enjoys 2010 vacancy. In the retail market, an 18,470 SF strip center
Population 269,388 a stable retail environment as evidenced by increased sales Population 702,744 traded for approximately $139/SF. There is currently an
tax collections. 8.4% cap rate on next year’s income.
Population 285,539 CNN Money recently ranked Clarksville as the fourth best Population 747,883 The multifamily investment market is severely bifurcated in
metro area to launch a business. Clarksville has been recog- relation to size and perceived asset quality. Well-located
Employment nized as one of the 20 best performing cities in the country’s Employment multifamily properties of 150+ units are attracting interest
200 largest metro areas. In 2010, Business Facilities Maga- from national buyers and cap rates for those higher
Household zine ranked Clarksville as the number four city nationwide for Household quality properties have decreased substantially. Multifamily
Average Income $56,015 Alternative Energy Industry leaders. Average Income $61,797 properties of 80 to 150 units have seen a slight increase
in activity from last year but still remain sluggish. Multifamily
Median Median assets with less than 80 units have seen no increase.
In this market, a 95-unit building traded for approximately
Total Population Total Population $3.4 million or $36,000/unit in July of 2010.
32 40
Clarksville At A Glance Knoxville At A Glance

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Memphis, Tennessee Austin, Texas
The Memphis office market has been in a holding pattern The Austin-Round Rock-San Marcos MSA has been identified
as speculative construction has stopped and tenants already as one of the top performers in the nation and offers a high
in the market are shopping for space, as opposed to new- quality of life. Known as one of the Greenest metros, Austin also
to-market tenants looking at the city. Memphis’ distribution enjoys a reputation as a technology incubator and was recently
strength, as well as its low cost, means the industrial named as the country's most progressive and proactive entre-
segment has seen strong leasing activity. Retail development preneurial center (Entrepreneur.com). Area housing is one
has seen a trickle of activity in the third quarter, while leasing of the best for investors based on anticipated recovery and
activity has picked up from 2009. potential price appreciation.
Much of Memphis’ office leasing has been tenants moving The Austin area has been spared the worst of the recent
within the market, usually to its main submarkets of East economic recession that has crippled many markets around
Memphis and Downtown. Pinnacle Airlines Corp. announced the country. Austin’s rate of exports increased 16% per year
its decision to relocate to 155,000 SF in downtown’s between 2003 and 2008, ranking it the 10th fastest-growing
One Commerce Square, a move from the airport area. exporter in the U.S. and 26th overall. Industrial market
No additional office development is expected until the absorption increased in the second half of 2010, led by US
existing vacancy fills up. Courier (78,600 SF) and Ultra Electronics (76,800 SF). With
Memphis’ industrial market has enjoyed a strong 2010, as overall vacancy still over 20%, there is still ample first-gener-
Contact Contact ation space ready to accommodate new tenants. Rental rates,
large spaces have been filled through leasing activity,
NAI Saig Company NAI REOC-Austin which have fallen approximately 30-35% since the bench-
principally in the Southeast Memphis and DeSoto County
+1 901 526 3100 +1 512 346 5180 mark high reached in late 2007, have begun to level out but
submarkets. Technicolor SA expanded its local footprint with
1.36 million SF while Solae signed a 630,000 SF lease. it remains a tenant’s market heading into 2011.
Similarly, Ozburn-Hessey Logistics LLC inked a 238,000 SF New and expanding companies such as Facebook, Inc.,
lease, GE Capital Aviation signed a 225,000 SF lease, and Hanger Orthopedic Group Inc., and LegalZoom.com Inc. are
Munich, Germany-based Siemens AG signed a 619,000 SF generating new jobs and helping the Austin office market
lease, all in the Southeast Memphis submarket. move along the road to recovery. Although office market
DeSoto County was strong, inking Imperial Toy to a 312,000 occupancy has seen some improvement, quoted rental rates
SF lease and GreenTech Automotive to a 367,000 SF lease. have softened and generous concessions are available. Mean-
Hamilton Beach Brands moved Memphis operations to DeSoto while, speculative development remains at a standstill.
County with a 10-year, 1.17 million SF lease. DeSoto County Population, job growth and personal income are the main
seems the next logical place for spec industrial building, as drivers in the Austin retail market supporting a steady rise
2010 IDI, Hillwood, Panattoni and ProLogis all have land ready for 2010 in total retail sales. The Austin retail market, totaling roughly
Population 1,325,833 development and there are six spaces larger than 400,000 Population 1,765,393 41 million SF, continues to experience a healthy retail
SF for lease. Earl M. Jorgenson Company is currently environment that has helped fill large vacancies, including
Population 1,382,629 constructing a 75,000 SF distribution center in Eastridge Population 2,086,147 Austin Community College backfilling the former Dillard's
Business Park. (194,000 SF) at Highland Mall. The restaurant market also
Employment
The Memphis retail market started slowly, but picked up as Employment remains active with expanding concepts as well as new
Population 552,287 Population 804,334 entries like Maggiano's Little Italy, Qdoba, Cafe Express
the year progressed. Babies “R” Us has been the largest
Household lease with a 47,000 SF lease in East Memphis. There has Household
and Los Cucos. Speculative development has dropped
Average Income $64,941 been a trickle of retail development as Weingarten Realty Average Income $82,863 dramatically but some existing projects are proceeding with
Investors built a pair of 11,250 SF buildings at an East expansion phases.
Median Median
Household Income $57,618 Memphis property to house Panera Bread, Genghis Grill and Household Income $64,649
Logan’s Roadhouse.
35 33
Memphis At A Glance Austin At A Glance

New Construction (AAA)/ N/A N/A N/A N/A New Construction (AAA) N/A N/A N/A N/A
RETAIL RETAIL
Regional Malls N/A N/A N/A 2.20% Regional Malls N/A N/A N/A 5.00%


Beaumont, Texas Corpus Christi, Texas
The real estate market in Southeast Texas slowed in 2010 The Corpus Christi economy is stable with a bright future, having
as several of the large petro-chemical plant expansions and the cleanest air of any industrial city in the United States and
one new plant were put on hold or canceled altogether based one of the deepest ports on the East Coast. The industrial
on economic conditions. Sales and leasing activity slowed to sector is driving the growth of the city. The market is strong
a crawl during the summer months with activity picking up as many heavy industrial users are considering locating to
in early September. Corpus Christi.
Land sales have been sluggish as loans have become difficult Downtown Class A office space is in high demand. Financial
to obtain with high loan to value ratios. Office activity has services and engineering firms are the most active. There has
increased in recent months as relocations have been in the been some movement of tenants from Class B buildings to
limelight. Class A. Older Class C buildings have the lowest occupancy
Retail is still very slow as sales tax revenue indicates a weak with rates that barely cover expenses. The south side office
consumer market. The retail market has shown recent signs market is firming up with stabilized rental rates.
of short-term improvement as seasonal retailers begin to gear The industrial sector continues to be the bright spot. Port
up for the Christmas shopping season. Port Arthur remains a related industries, including the petrochemical industry, are
very hot retail market. upgrading or expanding. Oilfield service companies are either
Contact The industrial sector has leveled off as the majority of con- Contact entering the market or expanding because of the Eagle Ford
struction jobs have peaked. We have witnessed a significant Shale formation, which is considered to be the next major oil
NAI Wheeler NAI Cravey Real Estate
amount of space become available over the last few months and gas play in the United States. Vacancy continues at a
+1 409 899 3300 Services, Inc.
of 2010. Much of this space was leased short term in support record low of 2% with industrial service-type warehousing
+1 361 289 5168
of plant expansion projects. being leased at abnormally high rates. A Chinese owned firm,
TIPCO, has purchased land for $1 billion dollar pipe manu-
Investment property continues to do quite well as local facturing plant. A $3 billion power plant, known as Las Brisas
investors compete with national investors for properties. Many Energy Center, is planned along the port.
national investors are looking in all areas of Texas based on
the attention the state has received with opportunities faring Anchored retail centers are doing well. Smaller unanchored
better than those in other parts of the country. We are seeing centers have the highest vacancy and a few have been taken
investment deals close to or near asking prices if priced back by lenders. Wal-Mart has purchased two sites for super
Metropolitan Area correctly. However it takes much longer to close a deal in the stores, one at the site of the former Parkdale Plaza on Staples
current economic environment and many deals simply never Metropolitan Area Street and the other on Saratoga Boulevard between Staples
Economic Overview
close. Buyers are required to put more money at risk to put and Airline. The proposed 700,000 SF outlet mall planned at
2010
Economic Overview the Nueces County Fairgrounds in Robstown is still moving
a property under contract as sellers have been burned too
Population 383,880
many times. Very few large deals closed in 2010. Currently 2010 forward. The remodeling to La Palmera Mall is almost
there are several large deals in the works and at this time
Population 424,579 complete. Occupancy has risen to 87%. However, Sunrise Mall
2015 Estimated
Population 381,909 2011 appears to be shaping up well. We feel that many is losing tenants at a rapid rate. The mall was taken back by
2015 Estimated
buyers remain on the fence waiting to see how the political Population 432,420
the lender last year and no buyer has been found.
Employment
156,942
environment plays out.
Population Employment
Population 186,691
Household
Average Income $53,787 Household
Median
Household Income $44,432 Median
Total Population
37
Median Age Total Population
35
Median Age
Beaumont At A Glance Corpus Christi At A Glance

RETAIL RETAIL
Sub Regional Centers $ 14.00 $ 22.00 $ 18.50 12.00% Sub Regional Centers $ 9.00 $ 28.00 $ 18.50 12.00%


Dallas, Texas El Paso, Texas
The Dallas/Ft. Worth market has shrugged off many of the The El Paso Texas commercial real estate market has
woes affecting the rest of the country, and is steaming remained rather steady while many other markets around
ahead with multiple billion-dollar infrastructure projects the country have suffered during the severe economic
geared toward serving an ever growing population and downturn. With billions of Federal Dollars being spent at Fort
economy. The commercial real estate market seems to have Bliss and as the economy recovers, El Paso’s economy is
turned the corner, and is currently experiencing positive well positioned for gains in 2011.
absorption in all product classes. Bright spots in the El Paso Texas economy continue to
DFW’s central location, business friendly attitude and include the new Texas Tech School of Medicine, the University
commitment to infrastructure upgrades continue to spur job of Texas at El Paso (UTEP) and explosive growth at Fort Bliss,
growth in the North Texas region. Current projects include where $4.5 billion dollars in approved government projects
major highway redevelopment around the airport and across were completed or are under way. Fort Bliss is home to the
the North Dallas area, continued expansion of the light rail US Army Air Defense Artillery School and four combat ADA
system, and the just announced $1.2 billion upgrades to the brigades. This is sparking new retail growth in major
original four terminals at DFW airport. The region will receive corridors leading to and from the base. El Paso Texas cur-
great exposure to the rest of the country and world when it rently ranks 23rd among 100 metro areas, as reported by
hosts Super Bowl XLV in February 2011. A key theme will the El Paso Times.
Contact be that we are a united economic region with multiple cities Contact
Commercial rents and occupancies remained mostly
NAI Robert Lynn and counties offering a variety of lifestyles and amenities. NAI El Paso
unchanged for 2010. Some gains in office leasing have
+1 214 256 7100 +1 915 859 3017
So where does the commercial real estate market stand? occurred in the CBD, where a local REIT and Mills Plaza
Supply exceeds current demand, making it a “tenants” Properties are redeveloping over 700,000 SF. Suburban
market in all disciplines as we play “catch up” from flat or office space has held steady.
negative absorption the past 2½ years. Industrial vacancy The industrial market, mostly consisting of distribution
stands at 12.5%, office is at 20%, and retail is at 10%. space, has experienced mixed results with rates remaining
We are seeing a marked increase in absorption and foresee stable or falling slightly. No new construction in this category
occupancy rates rising significantly in 2011 as companies is taking place as rents remain low relative to construction
make longer commitments and take advantage of the costs.
depressed rental rates.
Metropolitan Area Metropolitan Area Multifamily has experienced the most noticeable gains as a
Rental rates are currently $30/SF for Class A office space, result of the growth of Fort Bliss. Consequently, an inventory
$22/SF for Class B and $15/SF for Class C spaces. Indus- shortfall is expected. Occupancy exceeds 95% and rents
2010 trial rental rates range from $3.00-$5.25/SF for shallow 2010
are increasing, generally exceeding $.80/SF per month.
Population 6,540,927 bay distribution, and $2.00-$3.30/SF for Class A bulk Population 765,357
Single-family residential in the starter segment has been
warehouse. Tenants will continue to have the upper hand good but sales are slower in other segments.
Population 7,200,416 through the end of 2011, but as quality space continues to Population 796,117
get absorbed we could see speculative industrial starts by El Paso Texas stands on the Rio Grande River across the
Employment the end of 2011, and office projects by late 2012. Employment border from Ciudad Juarez, Mexico. The two cities form a
Population 2,820,687 Population 265,924 combined international metropolitan area with a combined
population of two million. In 2010 El Paso was awared an All
Household Household American City award, prestigious and the oldest community
recognition program in the nation.
Median Median

34 31
Dallas At A Glance El Paso At A Glance

RETAIL RETAIL
Sub Regional Centers $ 10.00 $ 25.00 $ 17.50 15.00% Community Power Center $ 4.50 $ 20.00 $ 11.00 N/A

Retail/Commercial Land N/A N/A Retail/Commercial Land $ 260,000.00 $ 871,000.00

Fort Worth, Texas Houston, Texas
Fort Worth is the fifth-largest city in Texas, the 18th largest Houston’s economy is based on energy, but to a lesser
city in the U.S. and was voted one of America’s Most Livable extent than in the past several years. Its diverse economy
Communities. Fort Worth continues to post positive job is composed of research firms, medical and biomedical
growth due to its diversified economic base. The local technology, telecommunications, agriculture and other
unemployment rate at 7.7% outpaces the U.S. average by distinct businesses. The emphasis on international trade is
almost two points. expanding and is a prominent theme in the city’s continued
Office rental rates in the CBD have remained steady and economic development. Long recognized as the energy
generally unaffected by the broader economy for multiple capital of the world, with every major energy company
reasons, primarily low vacancy rates. The direct vacancy rate represented locally, Houston is ranked second among US
for Class A office space, which excludes sublease space, cities with the most Fortune 500 headquarters.
dropped to 6.8%, relatively low compared to neighboring Houston’s office vacancy rate across all classes was 14.2%
Dallas and the national average. With such modest vacant in 2010 and a low 12.5% in the CBD. A total of 23 buildings
space available there is little pressure on landlords to reduce have been delivered to the market totaling 965,236 SF, with
rates. However, there are bargains to be found for tenants 2,167,880 SF still under construction. The largest lease
in the otherwise steady Fort Worth office market if you know signings in 2010 included the 695,800 SF lease signed by
where to look. The most immediate impact of the general KBR at KBR Tower (600 Jefferson), the 335,027 SF deal
Contact economy can be seen in the amount of available sublease Contact signed by Weatherford International at 2000 St. James Pl.,
NAI Huff Partners space, which over the past 36 months has ranged from NAI Houston and a 316,763 SF lease signed by Shell Trading at RRI
+1 817 877 4433 18,815 SF to 1 million SF. +1 713 629 0500 Energy Plaza (1000 Main).
The industrial market showed negative absorption for Houston’s industrial market has remained stable with an
the second straight year. The overall vacancy rate for overall vacancy rate of 6.3% and average asking rental rates
all products rose 0.09% to 12.4%. New development is of $5.20/SF per year. The largest lease signings in 2010
limited to owner users and not speculative. Rates continue included the 914,195 SF lease signed by Igloo Products
to drop as landlords incentivize tenants not to move. Few Corp. at 700 Igloo Rd., the 303,000 SF lease signed by
buildings are available for sale at discounted prices as Ashley Furniture at 14810 North Freeway and the 251,600
the money sits on the sidelines. Slow cautious growth is SF lease signed by Trans-Hold, Inc. at 8905 Spikewood Dr.
projected for 2011. Houston’s retail market has experienced a decrease in
The retail market can expect to see a stabilized vacancy vacancy to 7.6% overall. The average quoted asking rental
factor by Q1 2011 based on leasing activity in the last two rate is $14.55/SF, which represents a 2.9% decrease over
2010 quarters of 2010. The retail marketplace is showing signs 2010 the past year. Average sales prices have risen over the past
Population 6,540,927 of improvement, although the viral effects of a national eco- Population 6,017,013 several years. Retail properties sold for $181/SF over the
nomic downturn hinders a breakout of positive rent growth. past 12 months, compared with $171/SF in the previous
Population 7,200,416 Economists who focus on both national and regional stages Population 6,646,344 period. One of the largest transactions occurring within
will repeatedly report that Dallas-Fort Worth SMSA remains the past year is the sale of The Galleria for $570.65/SF
Employment the most reliable and diverse commercial retail market Employment in June 2010.
Population 2,820,687 in Texas, while Texas is viewed as a bright spot in the U.S. Population 2,524,496
Household
real estate scene. Household
Median Median

34 33
Fort Worth At A Glance Houston At A Glance

RETAIL RETAIL

Office in CBD $ 2,178,000.00 $ 3,267,000.00 Office in CBD $ 435,600.00 $10,052,271.00
Residential $ 20,000.00 $ 196,000.00 Residential $ 22,000.00 $ 1,219,680.00

(Brownsvile, Harlingen, McAllen, Edinburg, San Antonio, Texas
Rio Grande Valley, Texas and Mission.)
With a dynamic, young labor force, strategic bi-national The San Antonio market continues to move along the road to
location, low cost of living and development opportunities, recovery and is poised for a quicker upturn than many other
the Rio South Texas region is an ideal location for global major metro areas. The unemployment rate for the region
companies looking to expand or relocate. Two nations, one is among the lowest in the country and recent company
region, many choices is the focal point of the Rio Grande relocations and expansions will add more jobs to the area
Valley located in South Texas. over the next several months.
While commercial real estate activity continues to be down Citywide, office properties closed the third quarter with a
overall in the Rio Grande Valley, the market remains one of vacancy rate of 18.6% compared to the 18.7% recorded in
the strongest in the nation. According to the Milken Institute, Q3 2009. Likewise, quoted rental rates remained relatively
the McAllen-Edinburg-Mission, Texas regions ranked 4th in stable. The citywide average quoted full-service rental rate
the Best Performing Cities 2010: Where America’s Jobs Are increased to $20.54/SF on a full-service basis, up $0.08
Created and Sustained. The Metropolitan Policy Program from the previous quarter and $0.13 compared to the same
(MPP) at the Brookings Institution regularly lists the quarter last year for a modest annual increase of 0.6%.
20 strongest major metro areas in the U.S. It looks at In all, gross leasing activity retail properties generated
fundamental economic issues: economic activity, housing 103,212 SF of positive net absorption in Q3, which raised
and employment and the McAllen-Edinburg-Mission areas the year-to-date total net gain to 130,300 SF. That figures is
Contact Contact
earned a ranking in the top 20 Strongest Metro Areas list. comparatively small to historical amounts for this market but
NAI Rio Grande Valley NAI REOC Partners, Ltd.
Our local colleges and universities are also feeling the is positive nonetheless. Citywide vacancy decreased to
+1 956 994 8900 +1 210 524 4000
growth. More than 29,000 students enrolled in South Texas 13.4%, down 0.5% compared to the same quarter last year.
Colleges this year, a record high for the institutions and a At the same time, the average quoted NNN rental rate
7% gain from last year. increased by $.01 per square foot to $17.92/SF, but disci-
plined tenants with good financials continue to drive deals
Despite a slight decline in retail sales, leases to big box and have been able to demand significant concessions on
retailers are still entering the market. There are positive renewals and new leases.
signs that 2011 will begin to see big box users returning to
the market. Bass Pro Shop announced it was coming to In all, local industrial properties experienced a total of
Harlingen and should open in 2011. Rooms-To-Go and Pap- 230,548 SF of negative net absorption in the third quarter.
padeaux Seafood Kitchen both entered the market in 2010. Metropolitan Area As a result, the year-to-date total net gain was flattened to
Metropolitan Area 5,159 SF but remained in the black. The citywide vacancy
Economic Overview The office market is still dominated by healthcare and Economic Overview
rate increased to 13.9% compared to 13.1% last quarter but,
government agencies. 495 Commerce Center, a 110-acre 2010 despite American Standard’s move, vacancy is relatively
2010
master-planned business park, became home to its third Population 2,111,400 stable compared to 13.8% recorded last year at this time.
GSA building (25,000+ SF) which opened in Q3 2010. The citywide average quoted triple net rental rate remained
With the opening of the newest international bridge in Population 2,309,596 flat at $5.57/SF and tenants are expected to remain in the
January 2010, the industrial market continues to gain driver’s seat heading into 2011. Investment activity remains
Employment momentum. The presence of maquiladoras provides con- Employment mostly limited to user sales.
Population 383,537 siderable advantages to the economic environment along Population 860,723
the border by increasing trade, generating employment and Household
Household acquiring local resources.
Median Median

34
Rio Grande Valley At A Glance San Antonio At A Glance

New Construction (AAA) N/A N/A N/A N/A Premium (AAA) N/A N/A N/A N/A
RETAIL RETAIL


Texarkana (Bowie County, Texas/Miller County, Arkansas), Texas Salt Lake City, Utah
Texarkana's economy continues to remain healthy as Salt Lake City is a vibrant, pro-business community with a
evidenced by the accolades in national publications highly educated populace. Healthcare, technology and
acknowledging the sound economic growth of the area. education remain the primary drivers of the local economy.
Following the 2008 Forbes.com ranking of Texarkana as Unemployment is a relatively low 7.5% compared to the
#2 of all small metro areas with the fastest growing "gross national average. Salt Lake City continues to outperform the
metropolitan product," Texarkana was recognized by addi- nation as a whole and remains one of the soundest
tional publications during 2009. Milken's Institute's "Best economies in the U.S. Utah was recently ranked #1 by Forbes'
Performing Cities 2009 where America's jobs are created 5th annual "The Best States for Business and Careers."
and sustained" ranked Texarkana #17 in small metro areas The commercial real estate industry in the Salt Lake City met-
compared to #81 in 2008. ropolitan market remained close to levels experienced in 2009
Texarkana was ranked #22 by Moody's economy.com with slight improvements across most submarkets. Class A
in America's 25 Next Reviving Job Markets. The report iden- experienced the most improvement with overall vacancy drop-
tified metro areas that were anticipated to outgrow ping nearly 2%, resulting in an 11.36% overall vacancy factor.
the national average. Rankings were based on job growth The total office market inventory is 32.3 million SF, one-third
during the first projected quarter of 2010. A 2009 article by of which lies in the downtown submarket. Direct vacancy in
Kiplinger.com ranked Texarkana second among the 10 the overall market decreased slightly to 13.9%; vacancy
Contact metro areas that enjoyed the greatest home-price increases Contact downtown is 9.11% and 16.49% in the suburban submar-
NAI American Realty Co. over the past year. This article recognizes that Texarkana NAI Utah Commercial kets. Class A full-service rental rates have dipped to an
+1 903 793 2666 avoided the declining housing market and actually saw an Real Estate (Salt Lake) average of $22/SF for product downtown and an average
appreciation in housing values during the last year. +1 801 578 5555 of $20/SF for office space in the suburban submarkets.
The industrial base for the market area is diverse and Leasing activity is up considerably compared to 2009. Office
includes two paper mills, Cooper Tire & Rubber Company, leasing during the first nine months of 2010 has already
Christus St. Michael Health System and Red River Army surpassed 2009 levels by nearly 200,000 SF.
Depot. The Depot has just recently transferred several thou- Salt Lake City is a key distribution hub with over 109 million
sand acres with buildings and infrastructure to the Red River SF of industrial space. Total availability in the industrial
Redevelopment Authority. Construction continues on a new market declined to 7.83% this year after nearly reaching
clean burning coal power plant as well as additional 10% in 2009. Lease rates have declined almost 12% since
Metropolitan Area construction at Texas A&M University's 375-acre site. Texas Metropolitan Area late 2008 and average $.35/SF NNN per month. Industrial
Economic Overview A&M to date has completed several buildings at its new site. Economic Overview has been one of the strongest sectors with regard to leasing
2010 Two convention centers are breaking ground; one in Texas with 2010
activity and the aggregate square footage leased in 2010
Population 138,561 a Hilton Garden Inn and one in Arkansas with Holiday Inn. Also Population 1,153,603 has already eclipsed 2009 levels by over 11%.
under construction is a nursing home on the Texas side of The retail market has a total inventory of just over 38 million
Population 142,697 town. A new Academy Sports, Longhorn Steak House and a Population 1,258,207
SF. Vacancy in the overall market stands at 8%. Rates are at
Verizon store recently opened for business. $16.58/SF NNN in the CBD. Salt Lake City’s largest project is
Employment
Texarkana is located along the I-49 corridor. With the Employment the City Creek Center mixed-use redevelopment in the CBD.
Population 58,229 Population 579,255 The 20-acre development includes 1.5 million SF of office
completion of current construction along Interstate 30 and
Household US Highway 59, Texarkana has great potential for future Household
space, 800,000 SF of retail space, 700 residential units and
Average Income $50,883 development. We anticipate continued growth in the retail, Average Income $78,339 large swaths of open spaces. The development is scheduled
hospitality, restaurant and educational areas into 2011. for completion in 2012.
Median Median

38 Median Age 31
Median Age
Texarkana At A Glance Salt Lake City At A Glance

High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 4.15 $ 12.00 $ 6.50 N/A
RETAIL RETAIL
Sub Regional Centers $ 7.00 $ 18.00 $ 12.50 10.00% Community Power Center $ 10.50 $ 32.27 $ 21.77 N/A
Regional Malls $ 6.00 N/A $ 18.50 15.00% Regional Malls $ 26.00 $35.00 $ 30.40 N/A


Washington County, Utah Burlington, Vermont
The southern Utah commercial market has witnessed a Greater Burlington's commercial real estate market saw
significant correction due to the global recession, although stagnant growth in 2010, while 2011 looks to be somewhat
there are indications the market is beginning to heal. The more promising. Slight growth in the retail sector is expected
state economist is reporting that local employment statistics while the office and industrial markets absorb existing
should begin to improve in 2011. Recent activity in the inventories in 2011. Retail and industrial rents have stabi-
industrial market verifies this assessment as new announce- lized while office rents continue to decline.
ments will help bolster job numbers in the community. Retail rents declined throughout 2010 while major vacancies
The industrial market has seen vacancy rates hold steady were absorbed. The market's current vacancy rate stands
throughout 2010. With new tenants entering the market, at less than 7% while rents have stabilized. New retail
adsorption is expected to return to stable levels in 2011. More development for smaller retailers and restaurants in a few
large tenants than in any time over the previous three years prime locations are expected in 2011.
have emerged on the scene proving that investment buyers The region's office market remains very soft with many large
are interested in our market again. Lease rates have fallen vacancies amid weak demand. We expect very little new
by 50% over the past several years but with new interest in development while existing inventories are slowly absorbed.
the market, that figure is expected to decline. Burlington's CBD remains relatively strong compared to
Contact The office market is still showing signs of stress as vacancy Contact its suburban counterpart.
rates slowly drift higher. Construction remains down although Industrial vacancies in 2010 reached their historic high at
NAI Utah Southern NAI J.L. Davis Realty
several new leases have been signed. Condo sales and just over 10%. We see activity increasing and expect
Region +1 802 878 9000
investment sales continue to be slow. More business is the vacancy rate to decline throughout 2011 toward
+1 435 628 1609
moving toward the CBD or into very inexpensive space. its 20-year average of 7.5%. The biggest problem for
Retail has been slowly improving as vacancy rates have Vermont's industrial market is the very limited supply of well
stabilized and the lower lease rates have helped take located, fully serviced industrial lots.
pressure off of struggling retailers. Retail sales were up in Overall, the retail market is recovering nicely, while the office
2009 over 2008 and we expect a slight improvement again sector remains somewhat stagnant. Vermont's economy
in the market for 2010. Most of the activity is from local and over the past two years, while challenging, has not produced
regional tenants. National tenants have not expanded in our as much stress on the commercial real estate market as
Metropolitan Area market for about eighteen months. Metropolitan Area other parts of the country. Thus Vermont typically does not
Economic Overview Land prices remain depressed. Prices have fallen by more Economic Overview experience a great boom and bust cycle. This is mainly due
than 75% in the case of residential development land and to Vermont's complex and costly permitting process on both
2010 2010
improved or partially improved building lots are a fraction of the state and local level. Given these barriers to entry, most
the 2008 prices. Commercial land has fared little better, well-located commercial properties retain their value even
2015 Estimated but prices there are still off by 50% in many cases. Land 2015 Estimated in a down economy. Additionally, investors find the market
Population 170,441 investment will be a great opportunity for those who believe Population 214,317 extremely tight for quality investment-grade real estate.
in the long term demographics of the market and have the Given the circumstances, Vermont's commercial real estate
cash to buy. Population 110,326
market can be quite profitable for those developers and
Population 55,173
investors with the patience and resources to navigate the
Household Household development process.
Median Median

33 37
Washington County At A Glance Burlington At A Glance

RETAIL RETAIL
Sub Regional Centers N/A N/A N/A N/A Community Power Center $ 15.00 $ 18.00 $ 16.50 4.00%

Residential $ 10,000.00 $ 40,000.00 Residential $6 0,000.00 $ 150,000.00

Northern Virginia Seattle/Puget Sound, Washington
In Northern Virginia, vacancy rates fell across all office and The Puget Sound area is slowly pushing its way out of the
industrial building types and the market saw its first spec- recession and there are encouraging signs of recovery
ulative construction project in two years. With less new sup- across many sectors. Although the downturn didn’t hit metro
ply delivering, coupled with continued GSA leasing, vacancy Seattle until late in 2008, the economic thaw has begun.
rates are expected to drop further in the next few quarters. Stable employment at Microsoft, Amazon and Boeing has
As supply becomes constrained, landlords will be less helped keep higher unemployment at bay. Multifamily and
inclined to offer such generous concession packages. Ten- retail have been the brightest sectors. Industrial remains
ants are more often seizing the moment. relatively stable. Office has hit bottom and should recover.
Monday Properties is set to build what might be the tallest 2010 was a difficult year for most sectors of local commercial
office building in the Washington area, but the most striking real estate. However, the greater Seattle area is still a world
aspect of the plan is Monday has no tenants signed for the class business location that attracts high tech, aerospace,
580,000 SF building at 1812 North Moore St. in Rosslyn. international trade, manufacturing and other companies on
Rental rates in Fairfax and Loudoun Counties were generally the cutting edge of innovation. Amazon is moving into 2.1
flat, and are expected to continue along that path until million SF of space and the Gates Foundation is moving into
consistent levels of positive net absorption can reduce its new 1.3 million SF headquarters. Unemployment has
vacancies to below 12-13%. Class A rates in Arlington peaked and 2011 will be a year where the office, industrial,
Contact County increased 5% in the second quarter. This trend is Contact retail and multifamily sectors will all show positive absorption.
NAI KLNB expected to continue given Arlington's 7.2% direct vacancy NAI Puget Sound
The investment market is waiting for owners to sell at
+1 571 382 2100 rate and continued levels of strong demand. Properties
reasonable prices. Institutional buyers have started picking
+1 425 586 5600
Given the limited development cycle, existing supply con- off high quality properties at relatively low cap rates consid-
straints inside the beltway, a continued reduction in sublet ering the higher than historical vacancy rates. Low interest
inventory and consistent federal demand, the overall market rates and competition have kept values high for blue chip
is well positioned to experience further improvements. This is apartment, industrial and office properties. Leasing rates in
the reasoning behind the beginning of spec building. the office and industrial market dived in 2010 and users
On the investment sale side, transaction volume is up can still find excellent opportunities to decrease costs and
throughout the region with total sales volume increasing plan for business growth. Both Seattle at 16% and Bellevue
over 46% thus far in 2010 as compared to 2009. Sixteen at 14% have healthy office vacancy rates that are expected
Metropolitan Area Metropolitan Area to decrease in 2011. No new construction across the entire
assets sold for a volume of $1.03 billion in Northern Virginia,
Economic Overview Economic Overview region will decrease vacancies coupled with expected hiring
though prices per SF are down.
2010
in 2011.
2010 The retail market in Northern Virginia has held its own, but
Population 2,300,023 Population 3,461,985 Overall industrial vacancy is 8.5%, high for the region, but
rents generally remain flat to declining. One of the largest
recent retail deals in Northern Virginia was a 55,696 SF comparatively strong nationally. This rate will drop as port
Population lease signed by Bed, Bath & Beyond at 2051 Chain Bridge Population 3,672,452 traffic increases and Boeing begins hiring in 2011.
2,453,755
Road. One of the largest sale transactions that occurred Retail and multifamily are both strong investment segments.
Employment within the last year in the Washington market is the sale of Employment Apartment rents are expected to rise slowly in 2011 as
Population 1,253,788 Population 1,694,210 owners reap the benefits of a comparatively stable regional
Plaza America in Reston. This 222,692 SF retail center sold
for $49 million, or $220.03/SF. Household
economy and former homeowners now forced to rent. Retail
Household
Average Income $119,264 Average Income $84,448 occupancy and rental rates have bottomed and rents will
slowly rise this next year.
Median Median

37
Northern Virginia At A Glance Seattle/Puget Sound At A Glance

RETAIL RETAIL
Community Power Center N/A N/A N/A N/A Sub Regional Centers $ 19.00 $ 36.00 $ 32.00 4.20%

Land in Office Parks $ 300,000.00 $ 5,000,000.00 Land in Office Parks $ 5,662,800.00 $ 15,246,000.00

Spokane, Washington Tri-Cities, Washington
Spokane is fortunate to have an economy that is somewhat The Tri-Cities is located in southeastern Washington and is
insulated from the recessionary factors affecting many comprised of Richland, Kennewick, Pasco and numerous
major metropolitan areas of the United States. The business surrounding rural communities. Three rivers, nine golf
community remains stable due to the market’s large trade courses, and 300 days of sunshine offer a wide variety of
area of Eastern Washington and Northern Idaho. As 2010 recreational options in our community. Easily accessible, the
has progressed, the region is starting to see recovery and area is known as the service and occupational hub in the
new activity in the commercial real estate market. region. The economy is fueled by government contracted
The retail sector was hit the hardest with national retailers projects for environmental clean-up, scientific research and
closing underperforming stores. Vacancy rates increased to development, agriculture and healthcare.
12.26%. Currently, retailers are taking advantage of hungry In 2010 the office, retail and industrial sectors experienced
landlords offering attractive rents. Five Guys Burgers, Jimmy increased activity due to the $1.96 billion provided in the
John's and a number of local restaurants opened stores in Economic Recovery Act over and above the annual budget to
Spokane in 2010. Chase Bank, Trader Joes, Pizza Hut and assist and expedite the cleanup at the DOE Hanford site. The
Mattress Land also searched for new locations here. Tri-Cities has been fortunate to experience one of the
The office market has seen increased vacancy from 13.23% strongest housing markets in the nation with an 8.9%
to 13.95%. Blend and extend is the prevailing trend; office increase in the average sales price over the past three years.
Contact Contact The local unemployment rate, at 6%, is highly favorable
tenants are negotiating reduced rents in exchange for
NAI Black NAI Tri-Cities compared to the national trend.
renewals or lease extensions. Most major tenants over
+1 509 623 1000 +1 509 943 5200
5,000 SF are relocating or renewing at very attractive rental With the strong local economy and job growth we have seen
rates. Class A rental rates in the downtown CBD declined a number of new projects this year. Cascade Natural Gas
about 10% over the last year. It appears that there will be relocated its corporate headquarters from Seattle to a new
no net absorption of office space in the Spokane market for 20,000 SF building. Gold’s Gym renovated a former Hastings
the next six months to a year. location of approximately 40,000 SF. Hobby Lobby is currently
Industrial rental rates have remained flat in Spokane for renovating the former Joe’s 60,000 SF building and under
almost five years. With a lack of significant new construction, construction is an 18,000 SF building to be occupied by
rates have finally started to trend upward. Vacancy rates Fred’s Appliance. Demand for unimproved or shell office and
increased slightly over the last year from 10.19% to retail space has taken a downward turn as national chains
Metropolitan Area Metropolitan Area and local businesses absorbed the existing inventory. The
10.85%. This increase is due to some new vacancy in large
Economic Overview Economic Overview average rental rates for office and retail space have remained
industrial buildings over 20,000 SF. The market for space
10,000 SF and under has been stable. 2010
relatively steady. Class B and C locations have had to reduce
2010
Population 474,320 Population 249,078 rents and offer other generous T.I.`s/rent abatement.
Like the majority of the United States, investment property
sales in Spokane have been almost nonexistent. A few small Predictions for 2011 are positive as the Hanford budget
Population 507,803 investors purchased properties in the $500,000 to $2 million Population 278,204 was increased by over $50 million for the ongoing clean-up
range either paying cash or obtaining financing from local project, and a late spring ground breaking is anticipated for
Employment credit unions. 2011 will be a year of stabilization for most Employment Kennewick General Hospital’s $100+ Million facility in
Population 203,105 Population 117,931 the Southridge Master Plan. We expect expansion at Pacific
of Spokane's commercial real estate market. As the national
economy begins its slow recovery, Spokane will follow. Household
Northwest National Laboratories due to federal grants
Household
Average Income $57,341 Average Income $65,735 along with funding for local alternative energy companies
such as Infinia.
Median Median

37 Median Age 34
Median Age
Spokane At A Glance Tri-Cities At A Glance

RETAIL RETAIL

Land in Office Parks $ 2,831,400.00 $ 4,356,000.00 Land in Office Parks $ 185,000.00 $ 400,000.00

Northeastern (Fox Valley/Green Bay), Wisconsin Madison, Wisconsin
Northeastern Wisconsin saw a rebound in 2010 from the If there is a market that can withstand the downward
weak economies of previous years. While the market has economic spiral, it’s Madison. While Madison still has its
yet to stabilize, the area is experiencing a renewed interest economic challenges, unemployment is only at 5.6 %
for retail, office and multifamily property. In moving forward (versus 6.1% at this time last year), demonstrating the
towards 2011, this trend towards stabilization should con- impact and stability state government and University of
tinue. Vacancy rates are expected to decline as additional Wisconsin have on this market. New construction is basically
demand is created. Reduced rents and values continue to at a standstill except for the University, which is completing
hinder traditional investment transactions. The number of a $200 million research institute known as the Wisconsin
completed transactions is expected to increase. Institutes for Discovery.
Rental rates have seen a significant decrease in office, retail The current office market is soft. Many companies are mak-
and industrial areas as well as a rise in demand from current ing shorter commitments with many concessions. Overall
tenants for the reduction of per SF rates and allowances for office vacancy is 15.1%, up from 13.8% in 2009. HP did a
tenant improvement concessions. Because Northeastern 70,000 SF deal on the east side of town and Physicians
Wisconsin is viewed as a "renters market," a significant Plus is constructing a new west side building. There are
amount of the increase in traffic is due to current many proposed projects, but banks will not offer financing
businesses/operators looking for a deal on more space for less until these projects have signed commitments, therefore
Contact money or looking to get a landlord to give a low dollar proposal Contact making it a struggle to get new projects off the ground.
NAI MLG Commercial for the tenant to use to renegotiate their current rental rate. NAI MLG Commercial
The industrial vacancy rate sits at 7.2% in late 2010, as
+1 920 997 9990 +1 608 663 6000
Even with these dynamics of the market evident, landlords compared to 8.1% at this time last year, but with a positive
have been able to recoup some of these losses by getting yearly absorption of 49,000 SF. Sale transactions were down
the tenant to extend their terms. The reduced rates are also significantly with only 17 properties trading during 2010, as
acting as an added stimulus to the aspiring entrepreneur compared to 40 to 60 in better economic times. The
and the businesses looking to expand. This, along with the 160,000 SF GE/Lunar building is still vacant 12 months after
reasonable construction costs and the availability of owner- its recent sale.
occupant financing, is attracting new business, resulting in Credit-worthy retail tenants have spent 2010 deal hunting
expansion in the region. in Madison. Vacancy rates remain unchanged at 8.2%,
Metropolitan Area Like the rest of Wisconsin, values in the region are still down. Metropolitan Area though deals include significant landlord concessions.
The reduction in rental rates or other concessions have Target’s Hilldale Mall location is under construction. Major
reduced cash flow and thus investor returns. Owners lease transactions include Willy Street Coop on University
2010 who do have decent occupancy are looking at cap rates of 2010 Avenue, Ashley Furniture at Greenway Station, and Pawn
Population 1,128,608 10% or better (for non-credit tenants) to be able to sell. Population 945,499 America and The Tile Shop on East Springs Drive. While
Landlords who do fill the vacant footage will have to make up Downtown lease rates have remained the same as 2009,
Population 1,150,315 for the disparity by extending the term and yearly increases. Population 1,011,357 retail space remains in high demand in this area of the city.
Municipalities in the region are generally less willing to The investment market is unstable. Cap rates vary with
Employment allocate tax incremental financing or community development Employment
multifamily retaining the lowest rates and retail/industrial
Population 558,677 dollars but, in some cases, have become more willing Population 490,093
the highest. The large range varies between 6-12%.
Household
to allow for special use permits and variances within Household Investment properties are worth what credit tenants sign for.
Average Income $63,262 their boundaries. Average Income $67,964 Buildings without credit tenants on short-term leases have
been resulting in uncertainty in the financing market.
Median Median

38.7 37.1
Northeastern (Fox Valley/Green Bay), Wisconsin At A Glance Madison At A Glance

Manufacturing $ 3.00 $ 5.50 $ 3.50 N/A Manufacturing $ 3.20 $ 6.70 $ 5.25 1.10%
High Tech/R&D $ 3.50 $ 8.00 $ 6.50 N/A High Tech/R&D $ 3.35 $ 12.00 $ 8.00 11.00%
RETAIL RETAIL


Milwaukee, Wisconsin Casper, Wyoming
There is guarded optimism in Milwaukee that we are in an Casper has the amenities of a metro area with the conven-
economic recovery. Uncertainty still exists due to the lingering ience and accessibility of a smaller community. With 75,000
effects of the economic crisis and the inability of politicians people in Natrona County, the Casper area is the largest
to set a clear path on numerous local and national issues. MSA in Wyoming and supports a vibrant economy. Casper
Nevertheless, the majority of businesses reported sales cradles a broad industry base built around natural resources
gains over the preceding year and the job situation in the and expanding to manufacturers who desire low overhead
Milwaukee area, while still not great, has improved consid- with a central western presence.
erably over the course of 2010. (Source: MMAC) Industrial space rents range from $5-$12/SF gross and
Milwaukee’s office market has started to experience a level there is supply of about 4 million SF of rentable area and a
of stabilization. Overall vacancy rates remain at 21%, but vacancy rate of less than 5%. Office rents are $10-$20/SF
positive absorption during the second quarter of 2010 gross with a supply of about 2 million SF and a vacancy rate
resulted from activity in western submarkets. Milwaukee’s of around 10%. Retail space is priced from $12-$25/SF
CBD is located in the Downtown East submarket where gross with a supply of about 2.25 million SF and a vacancy
vacancy rates are approximately 16% but Class A office rate of 12% due to a couple of recent big-box vacancies
space remains at a low rate of 10%. This has prompted (Office Depot and Rex's).
discussion of new Class A office development, with at least There has been heavy retail and office development on the
Contact three new projects being floated to potential anchor tenants. Contact
east side of Casper, including a 600,000 SF regional mall,
NAI MLG Commercial NAI Luker
The industrial market has seen an increase in activity and a Wal-Mart super center (there is also a newer west side
+1 262 797 9400 +1 307 265 8000
absorption. Most activity is coming from the office/ware- Wal-Mart super center), Home Depot, Menards, five national
(Brookfield)
house segment where buildings with 20,000-40,000 SF are hotels, car dealers, and 500,000 SF of office/medical
+1 414 347 9400
(Milwaukee)
becoming difficult to locate. Rental rates have dropped campuses. A Kohl's Department Store is currently under
slightly, but most landlords are requiring at or near asking construction and is due to open summer 2011.
rates. Base rental concessions are being provided with larger Continued industrial demand has driven development to the
tenant improvement packages. Companies are starting to north and west. A 700-acre development is currently under
spend their cash but are still cautious and tracking every way with rail spur access through Burlington Northern and
dollar. in close proximity to Natrona County International Airport,
Metropolitan Area The retail market has seen an up-tick in leasing. Lease rates Metropolitan Area which is ideal for manufacturing and distribution. Drilling
have dropped since 2009 but have leveled out as vacancy and oil service companies have continued showing strong
has decreased over the past 12 months. Retailers have demand in the region.
2010 shown optimism for 2011-2012 expansion and have iden- 2010 Casper’s location facilitates access to worldwide markets
Population 2,318,368 tified new sites. New retailers to the market were Ultimate Population 74,581
through Wyoming’s only international airport, routes along
Electronics, Golfsmith, and Buy Buy Baby, all taking existing I-25 and rail routes. Casper is a regional medical, finance
Population 2,358,243 mid-box spaces. Grocers continued to expand: In Population 79,837 and retail hub with a trade area encompassing central
Menomonee Falls, Woodman’s opened a new 235,000 SF Wyoming. Companies are opening new facilities, while
Employment store and Pick‘n Save opened a new 106,000 SF store. Employment
established industries expand, creating jobs, infusing capital
Population 1,040,327 Sendik’s is opening in New Berlin and Piggly Wiggly opened Population 35,493
and solidifying investment.
Household
two stores in Milwaukee. Wal-Mart has also opened two new Household
Average Income $71,124 Super Centers, one in Muskego and the other in Waukesha, Average Income $58,790
as they continue to expand throughout Wisconsin.
Median Median
Total Population Total Population 38

37.5
Milwaukee At A Glance Casper At A Glance

RETAIL RETAIL


Jackson Hole, Wyoming
Jackson, Wyoming, sits at 6,200 feet above sea level in
Teton County. The unique natural beauty of this area has
made it a world famous tourist destination and resort area
with thriving retail shops, art galleries and a vibrant night
life to complement the numerous outdoor activities. Jackson
is ranked amongst the top resort towns in the nation.
Jackson is the county seat of Teton County and the only
incorporated municipality in the region. Of the 2.7 million
acres in Teton County, 97% are federally or state owned and

managed. The remaining 3% consist of already developed
land and permanently deeded conservation easements,
leaving available land scarce. The headwaters of the Snake
River are located in Teton County. In addition to world class
fly fishing, the river offers stretches for adventurous white

water rafting as well as a relaxing, scenic float. The three
ski resorts in the county, Jackson Hole Mountain Resort,
Contact Grand Targhee Resort and Snow King Resort, delight visitors

NAI Jackson Hole and residents alike.
+1 307 734 8700
Wyoming public schools are well-funded and residents enjoy
excellent amenities. Wyoming’s tax structure is one of the
most business-friendly in the nation, with no personal
income tax, no corporate income tax, no gross receipts tax,

no chain store tax, no excise taxes and low property taxes.
Wyoming is a freeport state which allows for a relatively
uninhibited flow of goods through the state to destinations

across the U.S. and from Canada to Mexico. U.S. energy
Metropolitan Area independence relies heavily on western Wyoming. The area is
the focus of extensive exploration and oil field development
Economic Overview
and has one of the largest natural gas reserves in the world.
2010 The world's largest known supply of oil shale is the Green River

Population 31,229 deposit in Southwestern Wyoming. Wyoming also has the
nation's largest supply of coal, and is one of the top four states
2015 Estimated
Population 35,113 in green job growth, including wind technology.

Employment
Population 20,994
Household
Median

Total Population
Median Age 36
Jackson Hole At A Glance

(Rent/SF/YR)
DOWNTOWN OFFICE
Low High Effective Avg. Vacancy

New Construction (AAA) N/A N/A N/A N/A
Class A (Prime) $ 25.00 $ 30.00 $ 28.00 N/A
Class B (Secondary) $ 12.00 $ 15.00 $ 14.00 20.00%
SUBURBAN OFFICE
New Construction (AAA) $ 18.00 $ 20.00 $ 20.00 N/A
Class A (Prime) $ 18.00 $ 22.00 $ 20.00 N/A
Class B (Secondary) $ 14.00 $ 18.00 $ 16.00 20.00%
INDUSTRIAL
Bulk Warehouse $ 6.00 $ 8.00 $ 7.00 10.00%
Manufacturing $ 7.00 $ 10.00 $ 8.00 10.00%
High Tech/R&D $ 8.00 $ 12.00 $ 10.00 5.00%
RETAIL
Downtown $ 30.00 $ 50.00 $ 32.00 5.00%
Neighborhood Service Centers $ 20.00 $ 30.00 $ 25.00 10.00%
Community Power Center N/A N/A N/A N/A
Regional Malls N/A N/A N/A N/A
DEVELOPMENT LAND Low/Acre High/Acre

Office in CBD N/A N/A
Land in Office Parks N/A N/A
Land in Industrial Parks N/A N/A
Office/Industrial Land - Non-park $ 2,000,000.00 $ 4,000,000.00
Retail/Commercial Land $ 3,000,000.00 $ 6,000,000.00
Residential $ 2,000,000.00 $ 3,000,000.00

n Glossary
n
Acre Health Services Index Population Growth Index
Area of land equal to 43,560 SF (4,047 M2). The Health Services Index was calculated The Population Growth Index was calculated by
by dividing an estimate of total health dividing the projected five year population
Bulk Warehouse (Warehouse) services employment by total non-agricultural growth rate for the Market by the same
All modern distribution facilities 25,000 SF (2,500 employment for a Market. This quotient was projected value for the United States. Data pro-
M2) or greater. Quoted annual rate, then divided by the same data for the United vided by SRC, LLC.
net basis. States. Data provided by SRC, LLC.
Regional Mall
CBD (City Center) High Tech/R&D (Flex) (Regional Shopping Center)
The central business district is a market’s Modern buildings with space dedicated to Suburban or downtown properties over
primary concentration of business activity, much research/product development, or buildings 600,000 SF (60,000 M2) with at least two major
like a traditional downtown. in industrial settings with high percentage of of- department store anchor tenants.
Class “A” Office (Prime) fice/showroom style finish.
Retail Rents
Excellent location (5,000 SF or 500 M2), high- GLA This report quotes the annual rate on a
quality tenants, high-quality finish, excellently Gross leasable area. full-service basis. Europe quoted as annual
maintained; usually new, or old buildings that are rates, net basis.
competitive with new construction. GSA
General Services Administration, the US Retail Services Index
Class “B” Office (Secondary) Government’s property procurement agency. The Retail Services Index was calculated
Good location (5,000 SF or 500 M2), fairly high- by dividing an estimate of total retail
quality construction and tenants. Buildings with Hectare
services employment by total non-agricultural
only minimal deterioration or obsolescence. Area of land equal to 2.47 acres. employment for a Market. This quotient was
Community Power Centers (Big Box) Highway/Commercial Land then divided by the same data for the United
Retail centers over 250,000 SF – 600,000 SF Refers to any commercially zoned land that has States. Data provided by SRC, LLC.
(25,000 M2 - 56,000 M2), which include one or frontage along, and access to, a major state or SF; s.f.
more “category killers”, life-style centers and out- interstate highway. Square foot or square feet, depending on the
let centers. reference. 1 square foot = 0.093 M2.
Income Index
Development Land Prices The Income Index was calculated by dividing SM; sm; M2
Based on land sales recorded between October per capita income in a Market by the average Square meter. 1 S.M. = 10.764 square feet.
2006 and October 2007. The guide quotes the national per capita income. Data provided by
rate paid for land with available utilities and SRC, LLC. Solus Food Stores
zoning in place for the use noted. Stand-alone large supermarkets or
Industrial Rents
hypermarkets from 50,000 SF (5,000 M2)
Downtown Office (City Center) This report quotes the annual rate on a and up. Quoted as annual rates, net basis.
Sites in the market’s central business district. net basis.
Suburban Office
Downtown Retail (City Center) Manufacturing Space
Stand-alone buildings and business parks not
Any prime ground floor retail space in the mar- All facilities of 25,000 SF (2,500 M2) or greater used within the metro city limits.
ket’s central business district, excluding space in the production or development of goods.
in enclosed malls. United Kingdom and Ireland Vacancy Rate
presented on Zone A Basis. Neighborhood Service Centers
The percentage of market space being
(Retail Units on Parks) directly offered by the landlord or properties for
Education Index Retail centers ranging in size from 75,000 to lease and the amount of sublease space being
The Education Index was calculated by 250,000 SF (7,500 M2 to 25,000 M2), anchored offered by tenants. In cases where the space is
dividing the number of people with a college de- by foot and/or drug stores providing general under lease but not occupied, count it as part
gree and some college education by the total services to the local market—including pad of the vacancy.
population in that Market and by then dividing sites. United Kingdom and Ireland presented on
that quotient by the same figure for the United Zone A Basis. Wholesale Index
States. Data provided by SRC, LLC. The Wholesale Index was calculated by
Net Basis dividing an estimate of wholesale employment
Effective Average Rent Indicates the tenant pays for most of the by total non-agricultural employment for a Mar-
Net present value rate taking concessions, such operating costs such as utilities, maintenance, ket. This quotient was then divided by the same
as free rent and escalations into account. repairs and cleaning. data for the United States. Data
Full Service Basis Office Index provided by SRC, LLC.
Indicates that the landlord pays all expenses. The Office Index was calculated by dividing Zone A
an estimate of office employment by total The area at the front of the shop at pedestrian
Government Index
non-agricultural employment for a Market. level. It is usually 6.1 meters deep, this
The Government Index was calculated This quotient was then divided by the same
by dividing an estimate of total measurement equating 20 feet. In a very
data for the United States. Data provided by limited number of locations, Zone A can be
government services employment by total non- SRC, LLC.
agricultural employment for a Market. This quo- 30 feet deep (9.1 meters).
tient was then divided by the same data for the Office Rents
United States. Data provided This report quotes the annual rate as
by SRC, LLC. full-service basis. Europe quoted as annual
rates, net basis.

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GLOBAL

MARKET REPORT 2011

Dear Real Estate Executive:

Dr. Peter Linneman, Chief Economist

of the economic recovery weighed on demand. But by year’s end

space users took advantage of a tenants’ market to lock in low rates

more than 24% the previous year.

lent support to Class A occupancy at the expense of Class B and C

space increased to 17.1% in 2010, up 40 basis points from 2009. $0.00

Markets continue to be weighed down by sluggish growth and

being absorbed, but is also attributable to companies taking sublease O ffice

retailers upgrading to better locations. The national average vacancy R etail

slipped marginally, from $4.60 in 2009 to $4.55 in 2010. 12.0%

expected never materialized, investment sales transaction volume 6.0%

year’s end points to a hopeful outlook for 2011. Manufacturing

2011 Global Market Report n www.naiglobal.com 4

2011 Global Market Report n www.naiglobal.com 5

pressure on home values, restoring some lost confidence in homes as an investment.

Capital Asset Pricing Model.

2011 Global Market Report n www.naiglobal.com 6

The Office Sector

balance until at least 2013.

an absence of construction financing and a 5.9% vacancy rate. We anticipate that

Vacancy Rate (%)

2011 Global Market Report n www.naiglobal.com 8

U.S. Retail Vacancy New Condominium Completion & Absorption

2011 Global Market Report n www.naiglobal.com 9

2011 Global Market Report n www.naiglobal.com 11

The Office Sector

2011 Global Market Report n www.naiglobal.com 12

The Retail Sector

The Investment Sector

2011 Global Market Report n www.naiglobal.com 13

2011 Global Market Report n www.naiglobal.com 14

Major Trends in China.

2011 Global Market Report n www.naiglobal.com 15

The Office Sector

2011 Global Market Report n www.naiglobal.com 16

The Retail Sector

The Investment Sector

2011 Global Market Report n www.naiglobal.com 17

The Residential Sector

2011 Global Market Report n www.naiglobal.com 18

Latin America and the Caribbean

2011 Global Market Report n www.naiglobal.com 19

2011 Global Market Report n www.naiglobal.com 20

2011 Global Market Report n www.naiglobal.com 21

2011 Global Market Report n www.naiglobal.com 22

2011 Global Market Report n www.naiglobal.com 23

Market Effective Avg. High Rent Vacancy

the development pipeline.

Berks County, Pennsylvania $ 24.50 $30.00 12.0%

Suburban Maryland/DC Suburbs $ 23.59 $ 69.00 9.0%

Market Effective Avg. High Rent Vacancy

Westchester, New York $ 38.00 $ 45.00 10.0%

Suburban Maryland/DC Suburbs $ 27.69 $ 45.00 2.0%

Philadelphia, Pennsylvania $ 27.00 $ 38.00 12.0%

getting deals done. Suburban Maryland/DC Suburbs $ 7.76 $ 10.00 7.0%

2011 Global Market Report n www.naiglobal.com 24

Mobile/Baldwin Counties, Alabama $ 18.75 $ 27.50 10.0%

Chattanooga, Tennessee $ 37.00 $ 50.00 10.0%

Retail Market Effective Avg. High Rent Vacancy