NAI Global Market Report 2010

Investment Office Industrial Retail Land
Commercial
Partners, Inc.
Commercial Real Estate Services, Worldwide.
® 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 2010
Dear Real Estate Executive:
No matter where you look, 2009 was a very challenging year for commercial real estate. As the global recession took hold,
local and regional economies stagnated or declined and market fundamentals eroded. Investors remained on the sidelines,
cut off from the capital needed to finance acquisitions, while those with cash waited patiently for signs the market truly
had bottomed. As the recession wore on, most major corporate tenants adopted a wait-and-see position, deferring major
decisions. As expected, vacancy rates climbed and rental rates fell as a result.
As the year progressed, government-led stimulus programs in the Unites States, Europe and elsewhere began to take hold
and by year’s end we began seeing signs that the recession had finally ended. But not before US unemployment topped 10%.
While we don’t expect much new demand in 2010 as companies recover, we are starting to see corporate tenants act by
taking advantage of the tenants’ market to negotiate more favorable lease terms today in exchange for a longer commitment.
We’ve come to call this practice “extend and blend,” and it’s a trend we expect will continue well into 2010. We also expect
investment sales to increase in 2010 as banks and financial institutions clean up their balance sheets and move more
aggressively to dispose of commercial real estate loans and financially distressed real estate assets.
NAI Global is pleased to present its 2010 Global Market Report. Now in its 24th year, the Global Market Report provides
comprehensive market data and overviews on over 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 2010 Global Market Report puts a wealth of market intelligence 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
information 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 2010 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 325 offices worldwide. www.naiglobal.com
1
Table of Contents
GENERAL INFORMATION Mexico (continued) Montana
NAI Global President's Letter ..........................................................1 Matamoros, Tamaulipas ............................................................65 Bozeman ..............................................................................101
Table of Contents...........................................................................2 Mexicali, Baja California ............................................................65 Missoula...............................................................................102
Note from Dr. Peter Linneman ........................................................3 Monterrey, Nuevo Leon .............................................................66 Nebraska
About Your Global Market Report ....................................................3 Querétaro, Querétaro ................................................................66 Lincoln .................................................................................102
GLOBAL OUTLOOK Reynosa...................................................................................67 Omaha .................................................................................103
Global Outlook ...............................................................................4 Saltillo, Coahuila .......................................................................67 Nevada
San Luis Potosi (SLP)................................................................68 Las Vegas.............................................................................103
REGIONAL HIGHLIGHTS Tijuana, Baja California..............................................................68 Reno ....................................................................................104
Northeast Highlights.....................................................................21 Torreon, Coahulia......................................................................69 New Hampshire
Southeast Highlights ....................................................................22 Caracas, Venezuela ......................................................................69 Manchester...........................................................................104
Midwest Highlights.......................................................................23 UNITED STATES Portsmouth ...........................................................................105
Southwest Highlights....................................................................24 Alabama New Jersey
West Highlights............................................................................25 Birmingham ..............................................................................71 Atlantic County......................................................................105
ASIA PACIFIC Huntsville/Decatur County ..........................................................71 Middlesex/Somerset Counties ................................................106
Melbourne, Australia ....................................................................27 Mobile/Baldwin County ..............................................................72 Northern New Jersey.............................................................106
China Arizona Ocean/Monmouth Counties (“Shore Market”)..........................107
Beijing .....................................................................................27 Phoenix ....................................................................................72 Princeton/Mercer County .......................................................107
Chengdu ..................................................................................28 Arkansas Southern New Jersey ............................................................108
Hong Kong ...............................................................................28 Jonesboro.................................................................................73 New Mexico
Shanghai..................................................................................29 Little Rock.................................................................................73 Albuquerque .........................................................................108
Xiamen ....................................................................................29 California Las Cruces ...........................................................................109
Guam..........................................................................................30 Inland Empire (Riverside/San Bernardino) .................................74 New York
India Los Angeles County.................................................................74 Albany ..................................................................................109
Chennai ...................................................................................30 Marin County ..........................................................................75 New York City........................................................................110
Delhi, Gurgaon .........................................................................31 Monterey County.....................................................................75 Long Island ...........................................................................110
Hyderabad, Pradesh..................................................................31 Oakland..................................................................................76 North Carolina
Kolkata.....................................................................................32 Orange County........................................................................76 Asheville ...............................................................................111
Pune, Maharashtra ...................................................................32 Sacramento ...........................................................................77 Charlotte...............................................................................111
Punjab .....................................................................................33 San Diego...............................................................................77 Greensboro/High Point/Winston-Salem ...................................112
Tokyo, Japan ...............................................................................33 San Francisco County..............................................................78 Raleigh/Durham ....................................................................112
Kuala Lumpur Malaysia ................................................................34 San Mateo County...................................................................78 North Dakota
Singapore....................................................................................34 Santa Clara County (Silicon Valley) ...........................................79 Fargo....................................................................................113
Seoul, South Korea ......................................................................35 Santa Cruz County ..................................................................79 Ohio
Taipei, Taiwan ..............................................................................35 Sonoma County.......................................................................80 Akron ...................................................................................113
Ventura County .......................................................................80 Canton .................................................................................114
CANADA Colorado Cincinnati .............................................................................114
Alberta Colorado Springs.....................................................................81 Cleveland..............................................................................115
Calgary ....................................................................................37 Denver....................................................................................81 Columbus .............................................................................115
Edmonton ................................................................................37 Delaware Dayton..................................................................................116
British Columbia Delaware & Cecil County Maryland...........................................82 Oklahoma
Vancouver................................................................................38 District of Columbia Oklahoma City.......................................................................116
Victoria ....................................................................................38 Washington, D.C. ....................................................................82 Tulsa ....................................................................................117
Nova Scotia Florida Oregon
Halifax .....................................................................................39 Fort Lauderdale.......................................................................83 Portland................................................................................117
Ontario Ft. Myers/Naples/Port Charlotte/Bonita Springs .........................83 Pennsylvania
Ottawa.....................................................................................39 Jacksonville ............................................................................84 Allentown..............................................................................118
Toronto ....................................................................................40 Marin & St. Lucie Counties ......................................................84 Berks County ........................................................................118
Montreal ..................................................................................40 Miami.....................................................................................85 Bucks County........................................................................119
Regina, Saskatchewan...............................................................41 Orlando ..................................................................................85 Harrisburg/York/Lebanon .......................................................119
EUROPE MIDDLE EAST AFRICA Palm Beach County .................................................................86 Lancaster .............................................................................120
Vienna, Austria.............................................................................43 Tampa Bay..............................................................................86 Philadelphia ..........................................................................120
The Baltics (Latvia/Estonia/Lithuania) ............................................43 Georgia Pittsburgh .............................................................................121
Sofia, Bulgaria .............................................................................44 Atlanta....................................................................................87 Schuylkill County ...................................................................121
Prague, Czech Republic................................................................44 Hawaii Wilkes-Barre/Scranton/Hazleton .............................................122
Copenhagen, Denmark.................................................................45 Honolulu .................................................................................87 South Carolina
Finland ........................................................................................45 Idaho Columbia ..............................................................................122
Paris, France ...............................................................................46 Boise......................................................................................88 Greenville/Spatanburg/Anderson Counties ..............................123
Frankfurt am Main, Germany ........................................................46 Southeast (Idaho Falls/Pocatello) ..............................................88 South Dakota
Atehens, Greece ..........................................................................47 Illinois Sioux Falls ............................................................................123
Reykjavik, Iceland.........................................................................47 Chicago .................................................................................89 Tennessee
Tel Aviv, Isreal ..............................................................................48 Springfield ..............................................................................89 Chattanooga .........................................................................124
Almaty, Kazakhstan ......................................................................48 Indiana Clarksville .............................................................................124
Kuwait.........................................................................................49 Fort Wayne .............................................................................90 Knoxville ...............................................................................125
Oslo, Norway ...............................................................................49 Indianapolis ............................................................................90 Memphis ..............................................................................125
Doha, Qatar .................................................................................50 Iowa Nashville...............................................................................126
Bucharest, Romania .....................................................................50 Cedar Rapids, Iowa City...........................................................91 Texas
Moscow, Russian Federation ........................................................51 Davenport/Bettendorf, Iowa & Rock Island/Moline, Illinois ..........91 Austin...................................................................................126
St. Petersburg, Russian Federation................................................51 Des Moines.............................................................................92 Beaumont .............................................................................127
Belgrade, Serbia ..........................................................................52 Sioux City ...............................................................................92 Corpus Christi .......................................................................127
Johannesburg South, Africa..........................................................52 Kansas Dallas ...................................................................................128
Madrid, Spain ..............................................................................53 Wichita ...................................................................................93 El Paso .................................................................................128
Stockholm, Sweden......................................................................53 Kentucky Fort Worth.............................................................................129
Geneva, Switzerland.....................................................................54 Lexington................................................................................93 Houston................................................................................129
Zurich, Switzerland.......................................................................54 Louisville ................................................................................94 Rio Grande Valley (McAllen/Mission/Brownsville/Harlingen) ......130
Istanbul, Turkey............................................................................55 Louisiana San Antonio ..........................................................................130
Kiev (Kyiv), Ukraine.......................................................................55 Baton Rouge ...........................................................................94 Texarkana (Bowie County, Texas/Miller County, Arkansas) ........131
London, England United Kingdom..................................................56 Monroe...................................................................................95 Utah
New Orleans ...........................................................................95 Salt Lake City........................................................................131
LATIN AMERICA AND THE CARIBBEAN
Maine Washington County ...............................................................132
Buenos, Aires Argentina ...............................................................58
Greater Portland/Southern Maine .............................................96 Vermont
Nassau, Bahamas ........................................................................58
Maryland Burlington .............................................................................132
Brazil
Baltimore ................................................................................96 Virginia
Campinas.................................................................................59
Suburban Maryland .................................................................97 Northern Virginia ...................................................................133
Curitiba ....................................................................................59
Massachusetts Washington
Porto Alegre .............................................................................60
Boston....................................................................................97 Seattle/Puget Sound..............................................................133
Rio de Janeiro ..........................................................................60
Western (Greater Springfield) ...................................................98 Spokane ...............................................................................134
Sao Paulo.................................................................................61
Michigan Tri-Cities ...............................................................................134
Santiago, Chile.............................................................................61
Detroit ....................................................................................98 Wisconsin
San Jose, Costa Rica ...................................................................62
Grand Rapids ..........................................................................99 Madison ...............................................................................135
Kingston, Jamaica........................................................................62
Lansing ..................................................................................99 Milwaukee ............................................................................135
Mexico
Minnesota Northeastern Wisconsin (Fox Valley/Green Bay) .......................136
Ciudad Juarez, Chihuahua.........................................................63
Minneapolis/St. Paul..............................................................100 Wyoming
Guadalajara..............................................................................63
Missouri Casper..................................................................................136
Guanajuato, Guanajuato ............................................................64
Kansas City...........................................................................100 Jackson Hole ........................................................................137
Mexico City ..............................................................................64
St. Louis ...............................................................................101
Glossary ....................................................................................138
2010 Global Market Report www.naiglobal.com 2

A Note From About Your

Dr. Peter Linneman Global Market Report
The 2010 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 2010 Global Market conditions that impact a market.
Report. For years, NAI Global has created this annual
report, 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
in 2003, we have provided NAI professionals and clients reporting 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 further information. Most of the data in the Global Market
pertain to real estate markets. Report was collected during the fourth quarter of 2009.
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 are quoted in terms of net rental rates, meaning the tenant
continue to jointly offer customized real estate market pays for most of the operating costs, such as utilities, mainte-
analyses and reports. Enrich your business and investment nance, and repairs and cleaning. On all charts, N/A means the
efforts by utilizing this combination of real estate expertise, information was not applicable or not available at press time.
including the Linneman Associates and NAI market analyses
and real estate decision making tools. For more information, For more information about this report, or to order your own
call 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
Investments: Risks and Opportunities. His teaching and
research focuses on real estate and investment strategies,
mergers and acquisitions and international markets. He
has published over 60 articles during his career. He is
widely recognized as one of the leading strategic thinkers
in the real estate industry.
Dr. Linneman also serves as the Albert Sussman The 2009 Global Market Report is a copyrighted publication
Professor of Real Estate, Finance, Business and Public of NAI Global, published in December 2009, and should not
Policy at the Wharton School of Business, University of be reproduced without full permission. Additional copies are
Pennsylvania. A member of Wharton’s faculty since 1979, available from NAI Global. Demographic data and indices
he served as the founding chairman of Wharton’s Real were provided by SRC, LLC.
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
© 2009 NAI Global. All rights reserved.
3
2010 Global Market Report www.naiglobal.com
Global Outlook
Commercial real estate markets across the United States
experienced the full impact of the global recession in 2009. National Average Rental Rates
The precipitous decline in transaction volume that began in
2008 continued unabated throughout most of 2009 as rising
unemployment and general uncertainty about the near-term
economic outlook weighed on demand.
Rising vacancy rates and declining rental rates were evident in vir-
tually every market and property type, with weak demand and a
growing supply of sublease space further eroding market
fundamentals. Office space in the central business districts
was especially hard hit; the national average vacancy rate for
downtown Class A office space reached 13.9% in 2009, an
increase of 35% over 2008, and the national average rental
rate fell 21.6% to $37.09/SF/YR. Suburban Class A space fared National Average Rental Rates
only slightly better as the national average vacancy rate rose to
16.9% in 2009, up from 13% in 2008, and the national average
rental rate slipped 4.6% to $25.11/SF/YR.
The retail segment was also hit hard as several notable retailers
and chain restaurant operators filed for bankruptcy and countless
others closed stores to cut costs. The national average vacancy
rate in regional malls reached 7.1% in 2009, up from 5.6% in
2008, and the national average rental rate for mall space fell
10.6% to $32.76/SF/YR. The vacancy rate in power centers, a
favorite of the struggling big-box retailers, soared to 9.8% in 2009,
up from 5.9% in 2008, and the average rental rate fell 6.3% to
$19.46/SF/YR.
National Average Vacancy Rates
The impact of weak consumer demand was also evident in the
industrial sector, where new supply compounded market woes.
The national average vacancy rate for bulk warehouse space
topped 11.1% in 2009, the highest level in five years, but the
national average rental rate dipped only 1.3% to $4.57/SF/YR.
Fortunately, these negative movements followed a very healthy
peak, and tight credit has greatly curtailed new construction
starts. While it is clearly a “tenant’s market” in all commercial
sectors, many markets already have begun to stabilize, and
should begin to improve in mid-2010 as space users act to
take advantage of the most favorable market conditions seen in
years. We expect a healthy balance between supply and demand
at that time. National Average Vacancy Rates
The investment market, stagnant throughout 2009, is also expect-
ed to return in 2010. Billion of dollars have been amassed in pri-
vate equity funds ready to pounce on the impending
wave of distressed assets and REO properties expected to
hit the market in the coming year.

US Overview
By Dr. Peter Linneman, Chief Economist, NAI Global
The current recession is the worst downturn in economic activity since the Great
Depression, a downtown that has been hurt more than helped by government intervention
and inconsistent—and often unpredictable—government policy. But barring more govern-
ment “salvation,” we hit bottom in May 2009. Without disastrous government “salvation,”
we probably would have bottomed in January 2009. Contrary to rhetoric, government
interventions both lengthened and massively deepened the current super-recession.
GDP grew at an annualized rate of 2.8% in the third quarter and employment will lag by
about a year. When job declines end, there will be a net loss of about 8.5 million jobs.
This is equivalent to more than four years of normal job growth.
To put the situation in perspective, real GDP was about $14.8 trillion (2008 $) at the start
of September 2008, falling by 3.8% (US$566 billion) year-over-year.
The US trade deficit has plunged, reflecting the horrific loss of global confidence in the
integrity and productivity of US capital markets. The US trade deficit has fallen to -2.8%
of US GDP, and -0.9% of rest-of-world GDP. Always remember that the US trade deficit
is not a reflection of the lack of competitiveness of our goods and services, but rather a
reflection of our capital market superiority.
The fundamental problem remains: It is impossible to predict what will happen next,
as every day brings new seemingly ad hoc rules. A perfect example occurred when
the list of autos eligible for clunker tax rebates was suddenly revised on the eve of the
program without any explanation. And tax, healthcare and regulatory proposals abound,
with little clarity as to the ultimate outcomes or costs.
Early in 2009, monthly job declines were wiping out 500,000-750,000 jobs. In July, that
number had diminished to just over 3,000,000, diminishing even further to 111,000 in
October and 11,000 in November. Year over year through November 2009, the US lost Real GDP Growth Rate
Year-Over-Year Percent Growth
3.5% of all payroll jobs. 10
8
6
On a 12-month moving average basis through September, just 26% of industries are adding
Percent
workers, versus the eight-year average of 46%. Not surprisingly, all sectors by major SIC 2
0
code, except the government (+132,000), experienced significant losses from the beginning -2
-4
of the recession in December 2007 through November 2009. On an absolute basis, the -6
1984 1989 1994 1999 2004 2009
biggest losers were the manufacturing (-2.1 million); trade, transportation, and utilities
(-1.7 million); construction (-1.6 million); and professional and business services (-1.3 million)
sectors. On a percentage basis, construction (-20%) and manufacturing (-15.5%) were the
worst performers. However, job losses continue to slow with a decline of just 11,000 in
November 2009. Professional and business services bottomed in August 2009 and
gained 148,000 (0.9%) over three months through November. This was driven largely by
education and health services, which increased throughout the recession by 858,000
(4.6%) between December 2007 through November 2009.
In November 2009, the unemployment rate stood at 10%, an increase of 510 basis
points since December 2007. Over the same period, the median unemployment dura-
tion has risen by 11.7 weeks, to 20.1 weeks (a nearly 140% rise), with the percent
unemployed more than 27 weeks rising from a low of 17.5% in December 2007 to

38.3% in November 2009. At the same time, short-term (five weeks or less) unemploy-
ment spells are back to the same level (1.8%) as December 2007, after peaking at 2.4%
in January 2009. The truth is that many more people are unemployed, and for longer,
as a result of rule-destroying government interventions, though modest improvements Manufacturing as a % of Total Employment
(with trendline)
are emerging. 40
35
Teen workers accounted for about 19% of the 7.2 million jobs lost between January 30
Percent
25
2008 and November 2009. Thank you, Congress, for the minimum wage increase. Job 20
15
losses continue to be extraordinarily male-centric, with 4.75 million of the 7.2 million total 10
5
lost jobs concentrated among males older than 19, and only 1.69 million among women 0
older than 19. This reflects the high concentration of males in manufacturing, construc- 1940 1950 1960 1970 1980 1990 2000
tion and finance, while women are disproportionately employed in the less adversely
impacted healthcare and education sectors. As a result, females now hold half of all US
jobs for the first time in US history.
The biggest uncertainty is not the capital markets; it is the Capitol markets. Despite the
serial ineffectiveness of government interventions, investors are slowly coming out of their
tortoise shells. The early signs of recovery are fragile because of the surge in oil prices
back to $70 per barrel. At $70 per barrel, it will take much longer to rebuild consumer con-
fidence, a precursor for a recovery. GDP bottomed in the third quarter, and employment
will lag by about a year.
In early December 2009, yields on 10-year Treasuries were around 3.5%. We believe 10-
year Treasury yields are still some 125 basis points too low. If all were normal, 10-year
Treasury yields would be around 4.75-5%, where they hovered before October 2007.
Recently, LIBOR and 30-day Treasuries have raced to zero. A low LIBOR has become
the life blood for many borrowers with floating rate debt, and a rate spike has the poten-
tial to crush many borrowers. Long-term Treasury Inflated-Protected Securities (TIPS)
returns have narrowed remarkably, even as inflationary threats loom. They experienced
a yield increase to 3.09% in November 2008, and stood at 1.87% in November 2009.
Residential mortgage delinquencies have risen among all products since hitting lows in
late 2005. However, these delinquencies are highly concentrated in recession torn
greater-Ohio (Ohio plus 100 miles beyond the Ohio border) and the boom markets of
south/central Florida, Arizona, Nevada and California. Elsewhere in the US, delinquen-
cies remain at cyclical norms.
Commercial mortgage delinquency rates have risen across the board, most visibly at
U.S. National Home Price Indices
banks and thrifts, and CMBS. CMBS issuance in the US remains nearly comatose, with 300
no new issues in eight out of the first 10 months of the year. The only positive glimmer 260
Index Value
was that the CMBS market managed to eke out a handful of deals in June (US$600 220
180
million) and July 2009 (US$300 million). And the recent DDR issuance is decidedly a
140
positive sign. 100
1989 1992 1995 1998 2001 2004 2007
The best news for the US economy continues to be that the US. housing market bot- Case-Shiller NAR FHFA
tomed in February 2009. Single family starts hit (a very low) bottom of roughly 355,000
units in January and February, increasing unsteadily to 511,000 in September and
476,000 in October. The inventory of homes held by builders for sale has plummeted to
239,000, as new home production over the past two years has been insufficient to
replace the more than 350,000 units destroyed each year. MLS home prices (which

exclude sheriff sales) have risen nationally, and in almost every MSA, for the past six S&P 500 Index
1,600
months. Thus, while many foreclosure sales in the weakest markets continue to drag 1,400
1,200
down the Case-Shiller and NAR indices, the preponderance of homes sold by resident 1,000
owners has seen price rebounds. This sector’s rebound over the next three to four years 800
600
will be a powerful growth engine. 400
200
The good news is that broad equity markets have rebounded, reflecting both improved 0
1955 1961 1967 1973 1979 1985 1991 1997 2003 2009
prices and cyclically low earning levels. Since bottoming at 676 in March, the S&P 500
has risen by 62%, and stood at 1,095 in early December, though still 29% below its peak
of October 2007. This rebound in broad equity pricing is good news for commercial real
estate, as it will slowly work its way through to real estate. While real estate pricing will Real Estate (Under) Over Pricing Using:
50 CAPM BBB Yld Benchmark
lag public markets, the rebound should serve to re-equitize many properties crushed by 0
-50
Percent
the collapse in late 2008 and early 2009. After steadily declining since the end of 2006, -100
REIT FFO multiples showed the first sign of changing course in the third quarter of 2009. -150
-200
In December, the overall REIT FFO multiple rose to approximately 14.1, compared to the -250
-300
long-term average of 12.1. 1994 1996 1998 2000 2002 2004 2006 2008
Liquidity premium assumed to be zero.
The Capital Asset Pricing Model (CAPM) indicates that public real estate pricing has
improved dramatically relative to its long-term risk during the past six months. In
particular, the under-pricing of REITs has gone from 230% in March, to 3% in December.
A comparative risk analysis, which assumes that the ownership of the perpetuity lease Vacancy Rates by Property Type
claim should generate approximately the same expected return as the perpetuity BBB 20
debt claim, suggests that real estate has gone from almost 70% under-priced to 9.5% Percent 15
over-priced. Research indicates that public pricing leads private pricing by roughly 18 10
months. This suggests a rebound in private pricing remains about a year away. 5
0
US Property Sectors 1983 1988 1993 1998 2003 2008
Source: NCREIF Office Retail Apartment Industrial
Office. In the third quarter of 2009, the national office vacancy rate rose to 14.3%, a 70-
basis point increase from last quarter, according to NCREIF. This puts US office vacancy
above the “natural rate” of roughly 10%. Severe job losses have resulted in increasing
shadow or sublease space along with tenant inducements. These availabilities are U.S. Commercial Construction
expected to increase through 2010. The first quarter of 2008 marked the first time the 120
100 Office Industrial Retail Hotel Multifamily

national office vacancy rate surpassed 13% since the third quarter of 2006, and it has
$ Billions
80
been rising since. 60
40
Industrial. NCREIF’s US industrial vacancy rate (primarily for institutional quality properties) 20
continued to increase, from 10% in the second quarter of 2009 to 10.8% in the third 0
1993 1995 1997 1999 2001 2003 2005 2007 2009
quarter. The two data series moved in lock step from 1987 to 2004. Since then, the
NCREIF series has trended downward more sharply, but changed course over the last
three quarters. This initial divergence indicates that the institutional-grade properties in
the NCREIF survey enjoyed greater demand than the overall market, but are now being
Multifamily Construction and Vacancy Trends
affected by the wide-reaching economic downturn.
Thousands of Units
Multifamily. The Census Bureau’s quarterly Housing Vacancy Survey indicates that the US 350 11
Vacancy Percent
300 10
250 9
multifamily vacancy rate rose in the third quarter to 11.1%, from 10.6% in the second 200 8
150 7
quarter of 2009. This series has generally been hovering around 10% since late 2003. 100
50
6
5
For NCREIF’s institutional properties, the national vacancy rate declined by 20 basis 0 4
1990199219941996199820002002200420062008
points, from 7.4% in the second quarter to 7.6% in the third quarter of 2009. This Total in Bldgs w/ 5 or More Units (Thousands) Vacancy
discrepancy in vacancy rates is due to the fact that the NCREIF properties are of higher

quality than the Census properties. Thus, better-quality properties are exhibiting better
fundamentals. Over the last 10 quarters, the Census vacancy rate has been relatively
flat, while the NCREIF series had exhibited a sharp increase, as unsold high-end
condos were converted to rental units. The first quarter decline indicated that the condo
market overhang may be subsiding.
Multifamily starts are about a quarter of their historic norm. They have fallen 75% in
about seven months, and will remain low due to the shortage of available construction
capital. This is not such a horrible thing in the near term, because there is a fair amount
of vacancy due to the fact that as the economy shed jobs, people doubled up. Young
graduates stayed with their parents, immigrants stayed with their cousins and brothers,
etc. This will continue until labor markets improve and we start to add jobs to the econ-
omy. The lack of construction means that excess inventory is being absorbed, but it is
tough on the construction business. The multifamily sector will take longer to rebound
and we will not see a recovery until late 2010.
Retail. NCREIF reported that the national retail vacancy rate jumped to 10.7% from
9.8% in the second quarter of 2009, after breaking 6% in the second quarter of last year,
the first time since 1999. The vacancy rate rose 300 basis points from year-end 2008,
and just over 315 basis points from a year earlier. The University of Michigan consumer
confidence index rose to 70.6 in November 2009, compared to its low of 55.3
in November 2008. The index had not seen the low of 2008 since 1980. Real retail sales
peaked in November 2007 at US$337 billion, declined to US$293 billion in April 2009,
and stood at US$296 billion in October through September 2009. On a monthly annu-
alized basis, retail construction has been declining steadily, and as of September 2009
was recorded at US$34.7 billion, down from its October 2007 high of US$62.6 billion.
Canada
Canadian growth, led by export and commodity sectors (base metals, oil and gas)
performed well through early 2008. However, the financial crisis, the declining US
market and general softening of the global economy slowed the Canadian economy in
late 2008 and forced a sharp downturn in 2009. A rebound in commodity demand
enabled the economy to stabilize in late 2009. The Canadian economy is expected to
fall 2% year-over-year in 2009, recovering in 2010 with real GDP rising by 3%.
The country continues to be subjected to multiple elections and the constraints of a
minority-led government. Unemployment remains above 8%, and is expected to ease
slightly in 2010 as the country emerges from recession. The Canadian dollar has mar-
ginally strengthened against the US dollar in 2009: in March the CAD/USD was $1.26
compared to $1.06 in November.
The ownership of commercial real estate in Canada is concentrated in large pension
funds, REITs and large domestic corporate investors. The best assets remain in rela-
tively strong financial hands with conservative leverage. Pools of capital are looking to
the US, Europe and Asia to satisfy the demand for high quality real estate investment
opportunities.
Land prices softened and cap rates increased in 2009. Overall, 2010 is expected to be
a challenging year, with pockets of strength in western Canada. Transaction volume is
slowly beginning to improve despite a slow economy. The fundamentals of commercial

real estate are stabilizing. Prudent lending practices for home buyers, developers and
investors differentiate the Canadian reality from the US experience. As liquidity slowly
normalizes, many sectors of the domestic economy will recover sooner than expected.
The retail sector will suffer the longest as consumer spending and consumer confidence
will remain sluggish through 2010.
There are two distinct operating environments in commercial real estate: eastern
Canada (e.g., Toronto, Ottawa and Montreal) and the western provinces (e.g.,
Vancouver, Victoria). Provincial markets such as Saskatchewan have emerged in the
past few years.
Toronto and Eastern Canada
Because Eastern Canada is the country’s manufacturing base, both the Ontario and
Quebec economies are straining under slow business conditions. In Toronto, a recent
surge in office and condominium construction will continue to overhang well into 2010 as
developers struggle with fewer tenants and a difficult credit environment. Downtown
Toronto and suburban Class A vacancies are about 9%. Retail space in Toronto is hard-
er hit with a 10% vacancy rate.
The greater Montreal area accounts for more than 21% of the entire Canadian office
market, with an office vacancy rate of 8%. The hotel industry in Montreal continues to
expand, although industrial development has slowed with the expectation of a recovery
in 2010. With its reliance on the government sector, Ottawa remains stable while Halifax
retains stability from a solid base of educational, medical and research facilities.
British Columbia (Vancouver and Victoria)
The western regions of the country possess abundant natural resources (oil and gas,
agriculture, potash, uranium, diamonds, gold, etc.), allowing them to weather the reces-
sion. Looking forward, the 2010 Winter Olympics will provide a boost to the regional
economy via tourism inflows. Commercial real estate remains strong in British Columbia.
The Vancouver office market has a vacancy rate of 7%, but with little new product com-
ing online in 2010-2011. This market will improve as the regional economy strengthens.
The Victoria office market, which is dependent on the space demands of the provincial
government, has seen increasing vacancies as government spending is cut.
Industrial real estate in Vancouver continues to outperform other areas with average
vacancy rates at about 4%. In Victoria, the industrial rents are stable due to lack of new
supply and vacancy rates less than 1%.
Retail space continues to be hit as the credit/financing environment remains tight, mut-
ing consumer demand. The retail vacancy rate is 8% in Victoria and is expected to
improve very little through 2010. Similarly the Vancouver retail market is under pressure.
However, the 2010 Winter Olympics coupled with population growth near the CBD will
help this sector recover.
Investment in commercial product in this region has been resilient with cap rates around
6-7% for Victoria and 6.5-8% for Vancouver. The Greater Vancouver investment market
showed signs of recovery in the third quarter of 2009, after five quarters of flat or declining
levels of activity. Investment products in the rest of Canada remain in low supply.

Saskatchewan
Saskatchewan is a smaller, resource-and-farm based economy that has blossomed
in the past four years, attracting small- to mid-sized investors. In 2009, Saskatchewan
has resisted the general economic downturn and proven to be an “oasis” due to its
abundant natural resources. The two largest cities are Regina and Saskatoon; with a
combined population over 500,000 and unemployment rate below 5%, Saskatchewan
has weathered this recession best of all Canadian markets.
Industrial market vacancies are at an all-time low, while rental rates continue to hold up
due to low supply and little new construction. Although the Regina office market has
experienced declining absorption, vacancy rates remain extremely low at 1.75%. Rental
rates will spike up in 2010 as the economy emerges from recession and drives up
demand for office product. Expansion continues in the retail sector in Regina with the
new neighborhood of Harbor Landing.
The Saskatchewan investment market remains strong with interest from local investors.
Cap rates are between 8-9% for well-located, well-tenanted projects.
Demand for agricultural land has risen steadily in the past three years. As pent-up demand
for natural resources and commodities re-emerges, rural land values are expected to
improve.
Europe-Middle East-Africa
While most of Europe remains firmly in the grip of recession, the worst is over and the
recovery is within sight. Within the Euro area, GDP growth is forecast at -3.8% for 2009
(as of mid October 2009), recovering to +1.2% in 2010. Within those figures, France is
expected to show -2.1% in 2009, and +1.3% in 2010. Germany growth rates for 2009
and 2010 are expected to be -4.9% and +1.6%; and for the UK, -4.4% and +1.4%,
respectively. Both Germany and France returned to positive GDP in the third quarter, but
the UK lagged at -0.4%. While the figures in Central and Eastern Europe are bleaker for
2009, they too will see recovery in 2010. Russia for example, will shrink by 7.0% in 2009
and rise 2.5% for 2010. Major Middle Eastern countries are expected to reverse decline
in 2010, with GDP growth for UAE and Saudi Arabia predicted to be 3.3% and 4.1%,
respectively.
Unemployment in the Euro area was 9.6% (as of August 2009) while industrial production
had fallen by 15.4%. Inflation is forecast at 0.4% for 2009. The Euro has strengthened
further against the US dollar (currently 1.50) in the last 12 months, as the European
Repo rate has fallen to 2%, with the UK Base Rate remaining at 0.5%. Consumer
demand across Europe remains weak with zero growth in Central and Eastern Europe.
However, industrial statistics in the 16-country Euro area increased by 0.9% in August,
following 0.2% in July.
Space demand in the EMEA region remains weak in all sectors with office vacancy rates
climbing to their highest levels since 2004. Fortunately, most of the western cities
entered the recession with little office development. But cities like Moscow, Dubai or Kiev,
where construction was booming, are being crushed. Development activity has declined
dramatically, and in all markets, many tenants have put space up for sub-letting.

Office rents have fallen across the region, with prime rents down by about 10% on
average from mid-2008 to mid-2009. Markets in Austria, Germany (excluding Berlin),
Switzerland and Netherlands have proven more resilient than others. Vienna, for example,
has seen a 5% decline in rental values, whereas markets such as Dubai, Dublin, Tel-Aviv,
London, Madrid, Moscow, Oslo and Warsaw have seen far more significant declines.
Rents in Moscow and Kiev are off more than 50% from their peak. In virtually all markets,
property owners are offering increased incentives, such as extended rent-free periods
(several years in some markets), and contributions to fit-out costs.
Retail rents, particularly in Western Europe, have withstood the recession better than
those in the office sector. Rents have held steady in Austria, Belgium, France, Germany,
Israel, Italy, The Netherlands, Portugal, Sweden, Switzerland and London (West End).
However retailers, apart from select discounters and those in the food sector, have
placed expansion plans on hold, and there have been some notable failures in the
sector. As in previous recessions, the gap between prime and secondary space has
widened as retailers upgrade from secondary to prime locations. As in the office sector,
development activity has been sharply curtailed, particularly in the Central and Eastern
European (CEE) markets.
The recession has also hit the warehouse/industrial sector. The most adversely affected
are Hungary, Ireland, Israel, Poland, Portugal, Russia, Spain, Ukraine and Dubai, all of
which experienced rental declines in excess of 20%. Most notably, industrial production
experienced a 15% per annum decline, while retail volume dropped by 2.6% per annum
through August 2009. Food and discount retailers are faring relatively well, but many
occupiers are downsizing, seeking to rationalize their existing space. Industrial develop-
ment activity has virtually stopped across the continent.
Investment volumes have fallen sharply across the region. In the first half of 2009,
approximately €25 billion were invested in European property – a mere 20% of the cor-
responding 2007 volume as institutional investors have adopted a wait-and-see attitude.
Due to concerns about the security of income streams, buyers are exclusively seeking
prime properties with long-term leases with notable transactions completed in France and
the UK. The latter has attracted some international investors, as values are expected to
rebound as economies bottom. German open-ended funds are slowly returning to the
market, but are restricting their search to prime, well-leased properties. Foreign
investors are taking advantage of the weakness of the UK Pound, the availability of long
term leases with upward-only rent reviews and historically high yield levels. A shortage
of prime stock is beginning to nudge yields down.
Prime office yields have increased across the region, with the exception of Switzerland,
though the rate of increase has slowed in the more mature western markets. In the UK,
for example, yields in the City of London are now around 6.5%, an increase of 225 basis
points from the peak. Yields in London’s West End are now 5.25%, an increase of 175
basis points. Current prime yields in Paris are around 5.75%, an increase of 215 basis
points. In Frankfurt they are 5.4%, an increase of 40 basis points. These corrections look
relatively small compared with shifts of 650 and 450 basis points in Kiev and Moscow,
respectively. The focus of investors on prime sector properties has widened the gap
between the prime and secondary yields.

As 2009 draws to a close, there is a mood of cautious optimism for 2010 and 2011.
However, a slow recovery will generate further value declines in many locations, partic-
ularly in the CEE markets.
Latin America and the Caribbean

In the first quarter of 2009, the global economic slowdown clearly affected Latin America
and Caribbean countries. However, the “hit” during the year was not as great as feared,
with Brazil, Peru, Panama and Colombia registering positive growth. However, real
estate development slowed in all countries as many developers decided to either wait
out the storm before breaking ground, or deliberately slow the pace of construction.
Consumer demand remained comparatively healthy in most of the larger countries, with
the notable exceptions of Argentina and Mexico. However decreased flow of investment
capital, corporate credit and the greatly diminished overseas demand for goods and raw
materials has adversely impacted the region.
Projections for the region in 2010 are optimistic, depending upon the country. But
growth will depend to a large degree on the depth and breadth of a global economic
recovery. The increasing level of construction and manufacturing worldwide will positively
impact the region, especially for raw materials and commodities. Many countries in the
region have been growing domestic demand, but most remain dependent upon over-
seas demand. Along with the implementation of measured fiscal policies and the
maintenance of adequate reserves, most Latin American and Caribbean countries are
positioned to prosper in the upcoming recovery.
The Latin America and Caribbean region has been able to weather the economic crisis
because most real estate projects and capital investments are done with equity rather
than debt. This served to insulate the region from the credit/financing crisis with the
exception of Mexico, whose economy is heavily tied to the US and Canada and where
much financing is done in dollar denominated debt. Even with the continued diversion
of credit to the tier one countries during 2010, most real estate markets in the region
will prosper.
The likely scenario is that demand for real estate will rise in 2010; and development
will increase as developers and investors regain their confidence. Positive real estate
supply growth will occur in the larger economies (Brazil, Chile, Peru, Panama and
Colombia), but there will also be a modest revival in the smaller economies and Mexico.
However, growth in resort and hotel development will lag. 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 continue below 2-5% in Santiago, Buenos Aires, Bogota and Sao Paulo.
With the notable exceptions of Venezuela, Ecuador and Bolivia, most Latin American
and Caribbean countries will experience economic growth in 2010. The challenge
remains for governments to provide adequate infrastructure to meet the ever-growing
needs of industry.
Argentina
The economy and growth were very impacted negatively during 2009 due to lower
agricultural commodity prices and weak external demand. Global exports should

increase, as should the agricultural, textile and service sectors. Inflation is expected to
stay high through 2010.
There continues to be a shortage of available Class A product in the office, industrial and
retail sectors. The office vacancy continues to be below 2%; industrial and downtown
retail are below 3%. The construction pipeline is insufficient to meet current and future
demand. Although in previous years the tight supply drove up prices, the slower rate of
absorption in 2009 resulted in the softening of rental rates.
The Bahamas
Both the tourism and banking industry – the two key economic drivers – were negatively
impacted in 2009. US and European tourist travel to the islands slowed as did construc-
tion of new hotel, resort and residential projects. The projected recovery in the US
and Europe in 2010 will provide some relief; but tourism is not projected to increase
significantly until 2011.
Downtown retail and office market absorption continues to slow, but the rate of decline
has decreased. Due to abundant parking and better access, suburban markets continue
to attract new growth and expansion. Demand has kept vacancy rates low and spurred
build-to-suit opportunities, although demand for suburban retail rents dropped some-
what in 2009. Demand is expected to increase during 2010, especially for industrial
space and more modern Class A space. Foreign investment in residential development
and hotels is largely on hold, while cap rates range from 7-11%.
Brazil
Brazil has proved to be one of the world’s most resilient economies, emerging from the
recession in the second quarter of 2009 with 1% quarter-over-quarter growth. The
expectations of a continued economic boom are partially due to oil in the country’s large
offshore oil deposits; Brazil’s hosting of the World Cup in 2014 and of the Olympics in
2016; alternative energy sources (e.g., ethanol); and continued policy and bureaucratic
reforms. In the short term, high business loan rates and bureaucracy will limit the coun-
try’s growth. Risk perception among international investors continues to decrease, and
the Brazilian Real continues to strengthen against the US dollar, from its low of 2.16 in
late 2008 to 1.76 in late 2009.
During 2009, the Brazilian real estate market continued to grow, albeit at a slightly slower
rate than previous years. The country remains an attractive target for Greenfield Class A
office, retail and industrial development and speculative real estate acquisition. Lease
rates for all product types remain stable while cap rates hover between 9-11%.
Colombia
Colombia continues to be the region’s secret success. Over the last 15 years, the
country has steadily grown and improved its democratic credentials. The Peso has
remained relatively stable rate at about 2,000 to the US dollar. The imminent finalization
of the Free Trade Agreement with the US will further benefit the economy.
Real estate development continued to be relatively strong during 2009 with demand
exceeding supply. Prices for office, retail and industrial space increased slightly in the first
half of the year, but flattened in the second half as the global recession began to hit the
country’s economy. International investment funds still have yet to venture strongly into
Colombia, but the domestic capital sources are investing actively in Greenfield projects.
Global investment interest largely disappeared during 2009, but is expected to return in
2011. Given the lack of a transparent investment market for existing product, cap rates
are difficult to identify, but are estimated to be 12% or greater.
Chile
Chile continues to be the benchmark for most countries in the region as the Chilean
economy recorded another respectable year of growth. Inflation dropped while the 7%
unemployment rate is among the lowest in Latin America and well below the US rate. The
drop in the prices for copper and other commodities paired with the decline in global
demand adversely affected the Chilean economy. However, Chile largely avoided any cri-
sis due to capital reserves built up when commodity prices were high in 2007-2008. Its
continued attempts to decrease its dependence on imports of natural gas by developing
hydroelectric projects in the Andes is hindered by ecological groups. Nevertheless, Chile
increased its domestic electricity supply by 7%. Chilean companies, profiting from their
strong macroeconomic climate, continued to cautiously expand operations into other
countries, including Peru, Colombia, Argentina and Brazil.
Demand for quality commercial real estate continues to be strong, albeit slightly dimin-
ished, with vacancies remaining below 3%. Of the developments slated for completion
in 2009, about 35% were completed on time, 50% were delivered a few months late,
with the rest expected in 2010. Rental rates remained stable and cap rates are about
8-10%.
Costa Rica
Although the US-Costa Rica Free Trade Agreement went into effect on January 1, 2009,
strong benefits have yet to be achieved. The opening up of the telephony sector in 2010
with the combined surge of insurance operators (from the 2009 sector opening) should
provide a boost to the economy; however, the pace of reform remains slow.
Real estate activity slowed during 2009 with resort, hotel and second home sectors on
the Pacific Coast hit hard, with activity dropping about 65%. In the municipal area of San
José, activity decreased 15-20% in the office and industrial sectors, but the retail
market declined by even more. Rental rates have softened in the office and industrial
sectors, dropping 10-15% for retail. For 2010, absorption in the commercial sectors is
expected to increase slightly, with a lesser increase in retail. Rental rates are expected
to be stable in 2010, but will firm up in the office and industrial sectors as absorption
increases. Along the Pacific Coast, recovery and renewed investor interest should start
in early 2011. Land prices are weak as owners try to cash out. Cap rates are above 9%
and project IRRs are above 18%.
Mexico
Mexico was the hardest hit of the larger economies given falling auto demand from the
US and the impact of swine flu on tourism. GDP is expected to contract 7.1% in 2009.
Mexico began to explore outsourcing of some of its oil-related activities, such as
joint-ventures with Petrobras. The positive effects of these efforts will only be felt after
2013, but should increase investment flows to upgrade the Pemex infrastructure for
greater exploration.

The exchange rate has hovered at 13.5 pesos to the US dollar throughout 2009. Interest
rates remain stable after having dropped in mid-2008 to their lowest levels (7.3%). The
demand for maquiladora product dropped significantly, but by year-end 2009, interest
has surged due to increasing labor and transport costs from Asian operations.
While real estate activity declined significantly, Mexico City fared better than most markets.
The office and the industrial sectors generally experienced positive absorption, though
about 20% lower than the previous year. Demand is expected to increase slightly during
2010. Lease rates in Mexico City are relatively stable, but softened by about 15% in the
secondary and tertiary submarkets. Sale prices across the country are also stable with
cap rates about 9.5% for quality product, and IRRs in the 15-20% range.
Venezuela
2009 was a difficult year for Venezuela as the global recession, plunging oil prices
and poor economic micro-management policies plagued the country. The next few
years will be particularly difficult with shortages expected in many sectors including
power and water. Except for activity from political bedfellows such as Iran, China,
Libya and Russia, there is virtually no new foreign investment in Venezuela outside of
the petroleum industry. That said, the petroleum industry remains a powerful and
profitable economic engine.
The country’s administration and policy environment hampers recovery. Vacancy rates
are still near zero in office, industrial and retail properties and rental rates are rising due
to high inflation rates. Investors and developers remain very cautious due to the lack
of transparency and political risks.
Asia Pacific
The general feeling across most of Asia is that the worst of the recession is over.
Most Asian countries have experienced a major rebound of stock markets, as well
as some improvement of real estate values, especially on the residential side. The
main indices in Hong Kong, mainland China, South Korea and Singapore have risen
more than 50% since January 1, 2009. The Indian Sensex has climbed 72% and
stands 20% above where it was just before Lehman’s demise. However, there
remains an underlying cautiousness.
Countries like Singapore, Hong Kong and South Korea that have seen quick
turnarounds in their residential property market values since the beginning of 2009 also
see their governments testing new regulations to manage another bubble. Hong Kong
has seen more than a 25% rise in its mid-priced residential sector, and a 40% rise in the
luxury sector since the beginning of the year. Recently, a Hong Kong apartment
was sold for a record price of HK$71,280 per square foot (US$9,197 per square foot),
setting a world record price per square foot. In response, the Hong Kong government
has cut mortgage limits and freed up more government land for residential develop-
ment. Nonetheless, wealthy mainland Chinese buyers continue buying luxury residential
properties all cash, and often on all-expense-paid property viewing tours by Hong Kong
developers.

Commercial rents have been dropping since late 2008. Class A office rents are down
from their peak 2007 levels by as much as 50% in the Singapore CBD and the Central
District of Hong Kong, and as much as 25% in Shanghai. Coinciding with the rental
compression, yields have risen, as sellers have fewer “real” buyers. Credit markets have
lower loan-to-value ratios, more stringent underwriting and higher interest rates.
Since the start of the global recession, institutional investors have changed their focus to
the developed countries with lower risks. The Asian market players learned from the
1990s Asian Financial Crisis and worked together to avoid a fire sale environment by
allowing borrowers to extend on modified terms. Some of the REITS and listed property
developers were also able to raise fresh capital in the public markets to reduce their debt
levels. Many properties that were listed for sale were later pulled off the market as the
bid-ask spreads were too large. In most of the major Asian financial centers (Tokyo,
Hong Kong and Singapore), institutional buyers were not on the playing field. The only
buyers in town were high net worth private buyers, so market activity through most of
2009 tended to involve transactions under US$100 million. In China, foreign investors
who were very active buyers in 2005-2008 became sellers in 2009, with domestic buyers
dominating the investment activity. Capital values have been hit hard, resulting
in a significant amount of transaction activity. In India, 2009 was a wait-and-see period, as
high land prices paid in 2006-2008 could not justify new projects at greatly reduced rents.
In the face of the global recession, wealthy Asians have staged a flight to safety, choos-
ing to invest in home markets instead of the US or Europe. As the wealth of the high net
worth investor class is expected to grow by 8.8% annually through 2015, China and
India should lead the way.
Australia
Australia was one of the few economies that never entered a deep recession. GDP
growth was 0.7% in 2009 and is projected at 2% for 2010. Estimates for consumer
price increases in 2009 and 2010 are 1.6% and 1.5%, respectively.
Office markets have been hit the hardest, with values falling by 15-25%. This has meant
yields for prime quality assets increasing by approximately 100 basis points in most
cities to 7-8%. Sydney had very few large office transactions in 2009 (only four sales
over A$50 million); whereas, Melbourne had more sales and some in excess of A$100
million. Perth and Brisbane have had very few transactions in 2009, with a drop in
demand for office space and massive new supply under construction. Australia’s capital,
Canberra, has had a disproportionate number of large transactions as buyers sought
assets with long-term leases to government bodies.
Retail investment activity has declined as access to debt was limited. The impact of the
government’s A$52 billion stimulus package has enabled households to continue
spending supporting sales and employment in many parts of the country. Industrial
markets are likely to see yields remain high, while demand remains muted.

China
China continued to post large GDP growth. Projections for GDP growth in 2009 and
2010 are 8.5% and 9%, respectively, while consumer price increases in 2009 and
2010 are just -0.1% and 0.6%, respectively. China’s RMB4,000 billion (US$586 billion)
fiscal stimulus package announced in late 2008 continued to work its way into the
economy. By the third quarter of 2009, China began to see a sharp rise in foreign
direct investment in its manufacturing sector.
In Beijing, the overall retail vacancy rate is over 30% due to Olympic construction. In
contrast, Shanghai’s prime retail vacancy rate is closer to 3.3%, but this could increase
with significant retail development for the 2010 World Expo under way.
Investment in the industrial sector is expected to rise as investors see opportunity in the
current pricing while owner-occupiers seek cheap buys. US-based Blackstone Group
L.P. has set up a fund manager in Shanghai to focus on local opportunities. Disneyland
will establish a “Magic Kingdom-style theme park with characteristics tailored to the
Shanghai region.”
Chinese will replace foreign investors as the main buyers of commercial real estate in
the country over the next few years. The domestic share of total property investment
grew to 70% in the first half of 2009, up from 36% in 2008.
Hong Kong
With Hong Kong’s strong dependence on finance and global trade, it felt the full brunt
of the global recession. Projections for GDP growth in 2009 and 2010 are -3.6% and
3.5%, respectively. Estimates for consumer price increases in 2009 and 2010 are -1%
and 0.5%, respectively.
For much of 2009, absorption of office space was negative. Meanwhile, occupiers upgrad-
ed from industrial or Grade B buildings to newer, attractively priced office buildings in
Kowloon. China's super-rich are still purchasing homes and sweeping luxury brand
items off the shelf. Although total retail sales have dropped 4% this year, luxury brands
are doing brisk business thanks to mainland shoppers. Industrial tenants continued to
cut costs by downsizing and relocating to more affordable premises, which has fueled
a high vacancy.
India
India continued to post large GDP growth through the recession. Projections for GDP
growth in 2009 and 2010 are 5.4% and 6.4%, respectively. Estimates for consumer
price increases in 2009 and 2010 are 8.7% and 8.4%, respectively.
The office property market is experiencing an increase in confidence as banks and
financial services companies buy, but the IT and Information Technology Enterprise
Solutions (ITeS) sectors have yet to enter the growth spree. Delhi and Mumbai have
grown the most in new properties available for rent. For example, vacancy levels rose
to 30% in the Bandra-Kurla Complex and Kalina districts of Mumbai while vacancy

levels in Noida (near Delhi) were 40%. The new government and falling interest rates in
the second quarter of 2009 have improved local business sentiment in India. But
despite improved confidence, office rentals slid in major cities as tenants moved to
cheaper locations or upgraded at no cost. Commercial property markets will likely
remain soft in the short- to medium-term. Landlords in secondary office locations will
struggle with the consequences of overbuilding and will increase tenant incentives. The
commercial market will follow the growth spurt of the residential sector, but slowly.
On the industrial front, market players are positioning themselves for leadership in
logistics and manufacturing platforms. Higher-quality buildings and infrastructure
are desperately needed but challenges remain in land acquisition and aggregating
land assemblage.
Indonesia
With a strong domestic economy and less dependence on foreign investment and
capital flows, Indonesia has weathered the storm well. Projections for GDP growth in
2009 and 2010 are 4% and 4.8%, respectively. Estimates for consumer price increases
in 2009 and 2010 are 5% and 6.2%, respectively.
Many multinational companies have put expansion plans on hold. Investment yields in
Indonesia are 7-9%, but there very few transactions closed in the last 12 months. The
office rental rate in Jakarta remained stable, even as the office vacancy rate will increase
to 15% by year-end 2010.
Rental prices fell due to weak economic growth. Supply is predicted to be high for the
next two years (around 290,000 SM during 2009-2010). As retailers consolidate stores,
absorption will be negative.
Japan
Heavy investment in residential and commercial property markets in the last few years has
led to extraordinary buying opportunities due to the current lack of liquidity. Projections for
GDP growth in 2009 and 2010 are -5.4% and 1.7%, respectively. Estimates for consumer
price increases in 2009 and 2010 are -1.1% and -0.8%, respectively.
The property sector has been badly bruised, with developers and managers accounting
for eight of the 10 biggest bankruptcies of listed Japanese companies this year. Many
large investment funds are proposing to start buying Japanese property in the first half
of 2010 when prices are expected to bottom. However, to date there has not been as
much distress in the market as most expected. One reason is that the leniency of
Japanese banks allows borrowers to refinance rather than forcing liquidation.
Commercial land prices in Japan fell 4.7% to a three-year low in 2008, with the decline
increasing to 5.4% in Tokyo, Osaka and Nagoya. Office vacancies in Tokyo's main
business districts increased for the 17th month in a row in June 2009 to 7.25%.
Financially strong office tenants have been upgrading their locations to better buildings
without increasing rents.

Malaysia
With Malaysia’s dependence on exports and FDI, the impact of the global recession
has been severe. Projections for GDP growth in 2009 and 2010 are -3.6% and 2.5%,
respectively. Estimates for consumer price increases in 2009 and 2010 are -2.2% and
2.2%, respectively.
Tourism is one of the country's biggest revenue sources, accounting for 12-13% of
gross domestic product. State investment agency Khazanah Nasional plans to invest
over RM1 billion in the leisure industry over the next two to three years in leisure
projects. Over the next few years, Malaysia will have some RM2.5 billion worth of new
tourism attractions (including Nujasaya, Legoland and Kidzania) which are expected to
attract nearly 2 million visitors combined annually.
New Zealand
The global recession has greatly impacted New Zealand and its commercial property
markets. Projections for GDP growth in 2009 and 2010 are -2.2% and 2.2%, respec-
tively. Estimates for consumer price increases in 2009 and 2010 are 1.5% and 1%,
respectively.
Commercial landlords continue to struggle with declining values, lower rents and
increasing incentive packages. Office and industrial vacancies continue to climb.
While the residential market in New Zealand has come back with significant strength,
the global markets to need to correct further before similar results in the commercial
sector occur.
Singapore
The global recession has been felt strongly in Singapore, as it is highly trade-depend-
ent. Projections for GDP growth in 2009 and 2010 are -3.3% and 4.1%, respectively.
Estimates for consumer price increases in 2009 and 2010 are -0.2% and 1.6%,
respectively.
Defying all expectations, Singapore's residential property market has rebounded in the
thick of the nation’s worst recession. New home sales between January and August of
2009 were already 80% of the total homes sold for the whole of 2007. But going
forward, prices of mass market and mid-tier projects will face resistance. The government
has announced anti-speculation measures to moderate sales volume and prices:
immediate removal of the interest absorption scheme (IAS) and the interest-only
housing loans (IOL) scheme for projects yet to be launched.
In the office market, Singapore recorded positive take-up in the third quarter of 2009
after three quarters of negative take-up. The island-wide vacancy rate for Class A office
space increased from 10.8% in the second quarter of 2009 to 12.2% in the third
quarter, a trend that is expected to continue as supply comes online.
The emphasis for retailers has shifted from store openings to streamlining operations,
prompting a 14.4% fall in rents over the year through June 2009. Rents in the Orchard
Road area will remain under pressure due to the large volume of new supply in the next
12-18 months.

Investment sales have jumped tenfold from S$304 million in the first quarter of 2009
to S$3.1 billion in the third quarter. Nearly half of the transactions are for the residential
sector while the commercial real estate sector makes up the remainder.
South Korea
With South Korea’s strong dependence on exports and weakened currency, the global
recession has been felt strongly. Projections for GDP growth in 2009 and 2010 are -1%
and 3.6%, respectively. Estimates for consumer price increases in 2009 and 2010 are
2.6% and 2.5%, respectively.
Investor demand in commercial property revived in the second quarter of 2009, with
capitalization rates at 5.5-6%. Class A office rents remained stable, while all others
experienced pressure on rents and occupancy. However, as new buildings are delivered
in the Seoul CBD in the fourth quarter of 2009 and through 2010, landlords expect to
face further pressure. The industrial market is also seeing vacancy rates of 15-20%, with
rents down 20% from the previous year. Retail sector rents were also decreased from
the previous year.
Taiwan
With Taiwan’s strong dependence on exports, the global recession has been felt.
Projections for GDP growth in 2009 and 2010 are -3.3% and 4.1%, respectively. Estimates
for consumer price increases in 2009 and 2010 are -0.2% and 1.6%, respectively.
Taiwan’s economy is extremely dependent on export goods factories, many of which
are cutting back in the wake of the global recession. Industrial vacancy rates ranged
from 13-20%.
The Taipei office market is strengthening because of closer economic ties with China
(particularly, the Cross-Straits Summit) enabling investment flows. Taiwan recorded its
highest overseas capital inflow ever in the third quarter of 2009 at nearly $13 billion.
Office vacancy rates are slowly improving. Retail sector vacancy rates ranged from
1-6%, although rents were slashed 40% or more across the board.

US Highlights – Northeast Region
Connecticut New Jersey Leading Price Class A Markets
Delaware New York
Maine Pennsylvania
Maryland Vermont Market Effective Avg. High Rent Vacancy
Downtown Office
Massachusetts Washington, DC New York City-Midtown $60.00 $110.00 14.7%
Class A
New Hampshire Washington, DC $51.00 $70.00 14.0%
New York City-Downtown $48.00 $75.00 10.5%
Boston, Massachusetts $42.50 $52.00 9.5%
Wilmington, Delaware $26.00 $28.00 20.0%
Market Effective Avg. High Rent Vacancy
Office
SuburbanOffice
Office Long Island, New York $31.00 $34.00 11.0%
ClassAA
The downtown Baltimore office market continues to gravitate to the water as Inner Harbor East
Class
Suburban
Suburban, Maryland $28.45 $45.75 15.0%
continues to build out. The new 600,000 SF headquarters for Legg Mason opened in 2009 as the
Northern New Jersey $28.00 $50.50 20.0%
largest office presence to date in that area. What will happen to the former Legg headquarters
Ocean/Monmouth Counties, New Jersey $27.50 $32.00 11.0%
at 100 Light Street remains a question.
With vacancy rates climbing to 9.5% in the Boston CBD and 16.5% in the suburbs, there is no
shortage of supply, allowing tenants with solid financials to take advantage of tenant-favorable Leading Price Retail Markets
conditions.
The Q3 vacancy rate of 11.9 is the highest New York City has seen in four years, but was up
only slightly from the previous quarter. Average asking rates are now $52.05/SF, down from
Office
New York City-Midtown $200.00 $1,200.00 7.6%
Downtown
almost $70/SF in late 2008. However, the rate of decline, as well as the supply of sublease
Downtown
Retail
A
Retail
space weighing on the market, has stabilized. On the investment side, Manhattan sales have
Downtown
Class
Washington, DC $55.00 $80.00 2.5%
been few; however distressed assets are starting to appear in greater number and it is expected
Pittsburgh, Pennsylvania $26.37 $36.00 7.6%
that foreign investors and well capitalized investment groups will seek to take advantage of a
Philadelphia, Pennsylvania $26.00 $100.00 11.0%
new pricing structure, spurring the expected turnaround.
The amount of vacant office space in the Washington market has trended up over the Market Effective Avg. High Rent Vacancy
past four quarters. With over 2 million SF still scheduled to deliver in 2009, and an additional Centers
ClassCenters
Office
Washington, DC $30.00 $45.00 3.0%
3.8 million scheduled for 2010, an easy prediction is an increase in the Washington, DC, office Suburban Maryland (DC Metro) $25.22 $55.00 7.9%
Retail
Retail
A
Suburban
vacancy rate through 2010. However, a potential tightening of supply may occur within the CBD Pittsburgh, Pennsylvania $25.00 $30.00 7.7%
Service
Service
during the first half of 2010. Long Island, New York $24.00 $30.00 10.8%
Baltimore, Maryland $23.00 $50.00 10.8%
Industrial
Centers
With asking rates hovering just shy of $5 NNN, Baltimore developers have sharpened their Market Effective Avg. High Rent Vacancy
Centers
Long Island, New York $30.00 $40.00 20.0%

Retail
pencils after sitting on recently delivered product in a market that was flooded with new
Retail
construction for most of 2008. Southern New Jersey $28.00 $38.00 5.0%
Power
Power
Philadelphia, Pennsylvania $27.00 $38.00 18.0%

Asking rates for Boston industrial space have dropped to an average of $6/SF NNN and vacancy
Western Massachusetts(Greater Springfield) $25.00 $30.00 10.0%
rates hit their highest level since Q1 2005. The lack of liquidity continued to plague the invest-
Suburban Maryland (DC Metro) $24.12 $44.00 2.4%
ment market in 2009. A majority of investment sales have been limited to smaller deals that can
MallsMalls
be locally financed.
RetailRetail
The vacancy factor in Northern New Jersey’s industrial sector is approaching a 10-year high. Long Island, New York $90.00 $120.00 12.0%
Regional
However, there have been transactions, especially in the second half of the year. Asking rates Washington, DC $62.00 $90.00 12.0%
Regional
have decreased approximately 20% and deals are being made off of those numbers. Landlords Wilmington, Delaware $60.00 $75.00 5.0%
are making shorter term deals more frequently than in the past, and tenants have also been Middlesex/Somerset Counties, NJ $50.00 $60.00 7.0%
reluctant to make long term commitments. Northern New Jersey $50.00 $60.00 3.8%
The vacancy rate in Philadelphia increased almost 4% to total 13% in 2009. Large land parcels
are scarce throughout the Delaware Valley, but Philadelphia features large tracts in the
Philadelphia Navy Yard and smaller parcels located in controlled industrial parks. Leading Price Industrial Markets
Warehouse
Retail Market Effective Avg. High Rent Vacancy

Industrial
Warehouse
Boston’s retail market has also felt the impact of the economic turmoil with lower rental rates Washington, DC $9.50 $16.00 16.0%
Industrial
and significantly higher vacancy in the downtown. Northern New Jersey $6.10 $9.50 12.0%
BulkBulk
The Northern New Jersey retail sector has experienced the most difficult market in the past 20 Suburban Maryland (DC Metro) $5.95 $14.00 12.5%
years. Vacancies in major corridors that would normally be leased right away are remaining Boston, Massachusetts $5.75 $7.00 11.0%
vacant for extended periods of time. The sector is suffering from a lack of activity as opposed to Long Island, New York $5.75 $7.00 9.0%
Manufacturing
the other sectors where there are deals to be made at a price.

Industrial

The Philadelphia County retail vacancy rate increased slightly to 11.9% in 2009. Strong con-
Manufacturing

Industrial
vention and tourism business continues to stimulate the economy. New restaurants continue to Suburban Maryland (DC Metro) $6.42 $11.25 8.7%
open and the $550 million dollar Sugar House Casino is under construction along the Delaware Boston, Massachusetts $6.00 $8.00 13.5%
River. There is still strong redevelopment activity of existing retail shops and retail centers within Northern New Jersey $5.75 $6.50 11.0%
the county. Albany, New York $5.55 $7.50 12.0%
Industrial
Flex

High Tech/R&D
Long Island, New York $16.00 $18.00 8.5%

Industrial
Washington, DC $16.00 $18.00 23.0%

Wilmington, Delaware $14.00 $20.00 18.0%
Suburban Maryland (DC Metro) $11.42 $16.00 7.8%

US Highlights – Southeast Region
Alabama North Carolina Leading Price Class A Markets
Florida South Carolina
Georgia Tennessee
Downtown Office
Kentucky Virginia
Mississippi Miami, Florida $38.23 $43.73 14.5%
Class A
Fort Lauderdale, Florida $30.00 $32.00 17.0%
Palm Beach County, Florida $30.00 $37.50 22.7%
Tampa Bay, Florida $28.00 $32.00 15.0%
Office Charlotte, North Carolina $27.25 $32.00 7.5%
The Atlanta office market’s supply has outweighed the demand, pushing the vacancy rate up in
the 19-22% range, creating negative net absorption and declining rental rates. With over 196 Market Effective Avg. High Rent Vacancy
Suburban Office
million SF of inventory, it is anticipated that the office market will experience more negative net Miami, Florida $33.25 $38.03 22.3%
Class A
absorption and remain flat for 2010. Northern Virginia $31.00 $50.00 20.0%
Miami office vacancy rose while rents dropped by more than 10%. Certain submarkets, most
notably the CBD & Brickell, are hardest hit as approximately 2 million SF are scheduled to be
Atlanta, Georgia $23.00 $25.34 12.2%
delivered in 2010 and 2011.
Net absorption in Orlando was negative in four of the last five quarters from Q2 2008-Q3 2009.
Vacancies are highest in Class A properties where average rents have declined by 6% over the
past year. Vacant sublease space has increased in all submarkets.
Leading Price Retail Markets
Many companies have been inclined to shed jobs or consolidate their office requirements in
order to cut expenses, leading to a decrease in Northern Virginia’s overall demand for office
Miami, Florida $31.86 $43.92 4.7%
Downtown
space. At the close of 2009, 13 buildings were under construction in Northern Virginia for a total
Retail
Charlotte, North Carolina $28.93 $34.00 10.5%
of 3.67 million SF, of which 67% was pre-leased.
Orlando, Florida $28.00 $35.00 10.4%
Concerns about the national economy were reflected in the RaleighDurham office market, Palm Beach County, Florida $25.63 $50.00 20.0%
which pointed to a rise in vacancy as tenants downsized and new sublease space brought Atlanta, Georgia $25.00 $40.00 8.0%
additional pressures. Vacancy hovered close to 19% with negative net demand.
Industrial Service Centers Northern Virginia $35.00 $50.00 10.8%
Retail
Absorption slowed in Atlanta’s 560 million SF industrial market. The amount of new construc-
tion has dropped considerably and although vacancy rates have climbed over the past several Miami, Florida $24.48 $45.17 7.0%
quarters and rental rates decreased slightly, leasing activity remains active. Nashville, Tennessee $20.88 $33.00 7.2%
Mobile/Baldwin Counties, Alabama $18.75 $27.50 10.0%
With over 1.6 million SF coming off the market in two large deals, the amount of large ware-
house space available in Memphis has decreased. Several national companies looking for large
blocks of space could edge lease rates upward next year. Market Effective Avg. High Rent Vacancy
Power Centers

Miami’s industrial sector suffered from the recession as transshipping slowed, smaller tenants
Retail

failed and bankruptcies in the automotive and construction industries intensified problems.
Chattanooga, Tennessee $24.00 $30.00 10.0%
Vacancies increased on a weekly basis throughout the year.
Columbia, South Carolina $23.00 $30.00 9.1%
Orlando’s overall industrial vacancy rate stands at 13.2%, up from 8.3% a year ago. Average lease Miami, Florida $21.37 $45.00 6.8%
rates have dropped by more than 10.5% over the past year in response to four consecutive
quarters of negative absorption. Vacancy rates are highest for flex product at 17.6%. New Market Effective Avg. High Rent Vacancy
Regional Malls
construction is non-existent. Fort Lauderdale, Florida $30.00 $40.00 8.0%

Retail
Retail Chattanooga, Tennessee $24.00 $30.00 10.0%

Columbia, South Carolina $23.00 $30.00 9.1%
Atlanta’s retail market, with over 298 million SF of inventory, reported a slight deterioration in
Miami, Florida $21.37 $45.00 6.8%
market conditions. Vacancy rates are hovering in the 10-14% range with negative net absorption
and rental rates are down from the last several quarters.
Boca Raton and Delray have weathered the storm best because of the density of population
and strong demographics. Discount tenants of all types have benefited from the decreased
Leading Price Industrial Markets
rental rates and increased vacancy and have used that as an opportunity to expand. Palm
Beach County has seen retail rents retreat 20-30% from the 2006-2007 peak. Market Effective Avg. High Rent Vacancy
Bulk Warehouse
Northern Virginia $9.00 $18.00 12.0%

Increasing unemployment and a decline in tourism have impacted Orlando’s retail sector. Asking
Industrial
Miami, Florida $7.41 $10.83 10.1%

and effective rents have dropped, while concessions now amount to more than 10% of asking
rents. The retail vacancy rate is 8.3% market-wide, up from 5.7% one year ago. New deliveries
have been dominated by single-tenant super centers.
Orlando, Florida $5.65 $7.001 2.3%
Over 2 million SF of retail space was completed in the RaleighDurham market with an addition-
al 900,000 SF under construction. Despite a rise in vacancy to 7%, overall net absorption was Market Effective Avg. High Rent Vacancy
positive, and rental rates declined. As construction continues on the Outer Loop (I-540) around
Manufacturing

Industrial
Raleigh, new retail opportunities will be opened at major interchanges. Fort Lauderdale, Florida $6.00 $7.00 9.0%
Jacksonville, Florida $4.28 $6.22 12.8%

High Tech/R&D

Industrial
Mobile/Baldwin Counties, Alabama $17.50 $20.00 15.0%

Miami, Florida $13.11 $19.33 9.3%
Northern Virginia $12.00 $23.00 18.0%
Lexington, Kentucky $11.50 $15.00 9.4%

US Highlights – Midwest Region
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 Chicago, Illinois $42.00 $55.00 16.1%
Class A
Missouri Detroit, Michigan $23.09 $30.00 9.8%
Grand Rapids, Michigan $19.00 $24.00 20.0%
St. Louis, Missouri $18.80 $22.00 13.0%
Office Kansas City, Missouri $18.64 $23.50 24.0%
Chicago’s downtown office market experienced four consecutive quarters of negative net
absorption and rising vacancies during 2009. Class A and Class B buildings are suffering from Market Effective Avg. High Rent Vacancy
Suburban Office
the highest vacancies, each above 16%. Suburban vacancy rates have been rising steadily since St. Louis, Missouri $25.00 $30.00 11.6%
Class A
2008, eclipsing 22% in 2009. Leasing activity is expected to pick up during 2010 as asking Chicago, Illinois $23.15 $30.00 23.4%
rents continue to slide and landlords offer aggressive concession packages. This should result Detroit, Michigan $22.50 $45.00 17.1%
in stabilizing vacancy rates. Kansas City, Missouri $20.81 $28.50 19.1%
Downtown Cleveland is positioned to capture momentum from several large public-sector Minneapolis/St. Paul, Minnesota $20.70 $31.00 9.8%
projects either planned or under way. The suburban office market was a more difficult
environment, hampered by widespread financial hardship among tenants.
The Detroit office market has developed a churning trend with many users taking advantage
of small spreads in rates between classes. Though rate gaps have narrowed, landlords are
hesitant to offer tenant improvement incentives as financing and cash remain scarce. New Market Effective Avg. High Rent Vacancy
demand is evident in the form of renewable energy and film production, yet these industries do Chicago, Illinois $30.00 $220.00 8.2%
Downtown
Retail
not have the critical mass to benefit the entire market. Madison, Wisconsin $20.00 $40.00 7.6%
Milwaukee, Wisconsin $20.00 $30.00 11.0%
Rental rates in the Milwaukee office market are down 20-25% and absorption is heavily
Kansas City, Missouri $17.88 $26.00 7.8%
negative with vacancy climbing to 18.5%. Tenants with lease expirations two to three years out
Minneapolis/St. Paul, Minnesota $16.83 $25.00 5.0%
can realize dramatic savings by renegotiating their leases through blend and extend transactions.
Office vacancy market-wide is 12% in Minneapolis with the highest vacancy in Class B space. Market Effective Avg. High Rent Vacancy
Tenants are renewing existing leases rather than absorb relocation costs. Landlords are Service Centers St. Louis, Missouri $16.24 $25.00 13.0%
offering discounted rates to tenants renewing 12-18 months in advance to ensure spaces Indianapolis, Indiana $16.00 $17.50 14.0%
Retail
remain filled. Davenport/Bettendorf, Iowa $15.00 $28.00 7.0%

Milwaukee, Wisconsin $15.00 $22.00 15.0%
Industrial Lincoln, Nebraska $14.75 $22.00 9.3%
The second largest industrial market and the most important transportation hub in the country,
Chicago’s industrial market also was challenged during 2009 due to lack of consumer spend- Market Effective Avg. High Rent Vacancy
Power Centers
ing, difficulty obtaining credit and economic uncertainty. Lack of new deliveries, combined with Indianapolis, Indiana $22.00 $26.00 10.2%
Retail
an increase in transactional activity, will help the market eventually rebound. St. Louis, Missouri $20.12 $28.00 4.9%
Detroit’s industrial vacancy continues to rise above 20%, primarily due to the hard hit automotive Kansas City, Missouri $17.01 $28.25 7.6%
industry. While there is minimal traditional industrial demand, renewable energy firms are Milwaukee, Wisconsin $17.00 $25.00 10.0%
beginning to look at flex space as an attractive option for solar and wind technologies. Grand Rapids, Michigan $16.00 $23.00 4.0%
Investors remain interested in the Indianapolis industrial market as modern bulk facilities are
still being delivered throughout the market. New construction is trending toward smaller
Regional Malls
Chicago, Illinois $50.00 $80.00 7.8%

warehouse/distribution facilities.
Retail
Rental rates and vacancy rates in Milwaukee have remained relatively stable with landlords Northeastern, Wisconsin (Fox Valley/Green Bay) $35.00 $55.00 10.0%
requiring at or near asking rates while giving concessions on tenant improvements or rent Sioux City, Iowa $35.00 $45.00 7.5%
abatement. Larger transactions are stewing, but may not occur until Q1 2010. Wisconsin lost Lincoln, Nebraska $32.00 $85.00 17.5%
large employers like General Motors and other large employers, like Harley Davidson, have dras-
tically reduced their workforce.
The St. Louis industrial market continues to suffer from an excess of speculative space Leading Price Industrial Markets
resulting in elevated vacancy rates and decreased rental rates. Vacancy rates increased to 9%
in 2009, up almost a full point from the end of 2008. Average rental rates dipped slightly
Bulk Warehouse
to $4.21/SF.
Industrial
Fargo, North Dakota $5.50 $6.00 9.9%

Retail Omaha, Nebraska $5.02 $6.67 5.7%
Power centers in Detroit have begun to feel the effects of falling consumer spending Milwaukee, Wisconsin $4.60 $5.00 13.0%
and increasing unemployment with many anchor and smaller tenants vacating. Significant Cedar Rapids, Iowa $4.50 $6.50 7.8%
investments by Meijer and LA Fitness helped mitigate the impact of the closing of Circuit City
locations throughout the Metro Area. Market Effective Avg. High Rent Vacancy
Manufacturing
Cedar Rapids, Iowa $6.50 $10.00 5.0%

New retailers in Milwaukee included Erewhon, Dave & Buster’s and Gold’s Gym. Local and
Industrial
Detroit, Michigan $6.50 $8.00 24.0%

regional grocers such as Pick ‘n Save, Sendiks and Woodman’s will continue to expand in 2010.
Fargo, North Dakota $6.50 $6.90 9.9%
Expect vacancies to increase and effective market rents to drop until the market levels out.
Nordstrom Rack and Von Maur have announced plans to enter the St. Louis retail market, but Des Moines, Iowa $4.60 $6.25 6.9%
the timing remains uncertain. They’ll be joined by CVS Pharmacy, Dunkin Donuts, Five Guys
Burgers & Fries and Chick-fil-A, which are expected to open multiple locations in the next year.
High Tech/R&D
Indianapolis, Indiana $16.50 $17.50 13.4%

Industrial
Canton, Ohio $12.00 $14.00 6.0%

Dayton, Ohio $10.07 $13.33 25.1%
Cedar Rapids, Iowa $9.00 $15.00 10.0%

US Highlights – Southwest Region
Arkansas Oklahoma Leading Price Class A Markets
Kansas Texas
Louisiana
Downtown Office
Austin, Texas $35.96 $26.30 15.1%
Class A
Houston, Texas $34.66 $45.00 7.0%
Office Fort Worth, Texas $26.00 $29.00 6.0%
The Austin market failed to absorb 600,000 SF in the first half of 2009. Luckily almost 300,000 San Antonio, Texas $21.05 $24.00 12.8%
SF of mostly Class A space was absorbed in Q3. Landlords are working hard to keep existing Baton Rouge, Louisiana $20.75 $21.50 9.7%
tenants and make attractive deals through rent concessions.
The Dallas/Ft. Worth market leads the nation in employment gains for 2009 and the posi-
Suburban Office
tive numbers are reflected in what appears to be a healthy office market. Overall vacancy in Houston, Texas $27.47 $40.55 16.0%
Class A
Dallas remains flat from a year ago at 17.2%. Market rents have dramatically increased to Austin, Texas $26.29 $19.50 21.4%
an averaging of $20.05 for all classes of office space. Many companies are choosing to do San Antonio, Texas $24.49 $28.00 14.1%
short-term renewals versus making long term decisions. Dallas, Texas $24.30 $45.00 16.0%
New Orleans, Louisiana $21.50 $23.00 9.4%
Houston’s office vacancy rate across all classes was 14.2% in mid-2009 but a low 8.1% in the
CBD. A total of 15 buildings totaling 1.1 million SF delivered in 2009 with 3.8 million SF still
under construction. The CBD saw its share of large lease transactions, with three deals alone
accounting for over 1.4 million SF.
The New Orleans office market has remained relatively stable in terms of occupancy and rental
rates in the CBD and suburbs. No speculative inventory has been added in either market, and Market Effective Avg. High Rent Vacancy
Houston, Texas $37.71 $50.00 8.0%
Downtown
the adaptive re-use of older Class B and C buildings has actually reduced available supply.
Retail
Austin, Texas $27.50 $41.00 4.0%
The Oklahoma City office market remains strong with overall vacancy at 10%, up from 8.9% a
year ago. Rents are very stable with Class A at $22/SF. No new construction is planned except
San Antonio, Texas $24.33 $34.00 17.3%
for Devon Energy’s 750,000 SF corporate headquarters in the CBD, to be completed in 2012.
Fort Worth, Texas $19.47 $38.00 2.0%
Industrial Market Effective Avg. High Rent Vacancy

Austin added 3.4 million SF of industrial space from year-end 2007 through mid-2009, an Service Centers Little Rock, Arkansas $27.75 $35.00 40.0%
McAllen/Mission, Texas $23.00 $22.00 12.0%
Retail
increase of 10% of gross inventory over an 18-month period. There is no institutional grade
product currently under construction and rents continue to erode. Austin, Texas $21.00 $32.00 16.0%
Corpus Christi, Texas $19.00 $28.00 14.0%
The vacancy rate in the Dallas industrial market stands at about 12%. There is heavy competi-
tion for every tenant, pushing rental rates down while also increasing move-in incentives.
Absorption rates are in the negative territory for the first time in a while.
Houston’s industrial market has remained stable with an overall vacancy rate of 6.9% and
Power Centers

average asking rental rates of $5.70/SF per year.
Retail
Baton Rouge, Louisiana $28.00 $40.00 6.6%

The industrial sector is booming in Jonesboro, Arkansas, with the announcement of Nordex Beaumont, TX $18.50 $22.00 12.0%
USA’s plan to construct a $100 million wind-energy plant in the Jonesboro Industrial Park and Dallas, Texas $17.47 $30.00 13.2%
Alberto Culver expanding to allow for even more jobs and production outside of Jonesboro. Wichita, Kansas $15.00 $22.00 6.0%
More than 1.5 million SF of industrial space absorbed by contractors, utility crews and relief
workers in New Orleans in the months following Hurricane Katrina has been returned to the Market Effective Avg. High Rent Vacancy
Regional Malls
market. That, combined with new inventory, produced a vacancy rate of more than 13%. The McAllen/Mission, Texas $80.00 $100.00 4.0%
first softening in rental rates and pricing is evident. San Antonio, Texas $42.50 $60.00 10.4%
Retail

Baton Rouge, Louisiana $35.00 $80.00 5.3%
Retail
Austin, Texas $33.50 $45.00 5.0%
About 618,940 SF of retail was delivered in Austin in 2009 while only 278,130 SF was
absorbed. This resulted in average rental rates decreasing by $2.81/SF from December of 2008
to June of 2009.
The Dallas/Ft. Worth retail market has a 9.4% vacancy rate and a retail rental rate of
$13.37/SF. Net absorption has been in excess of 1 million SF and the average rental rate has
Bulk Warehouse
increased 0.8%. Some 21 buildings were delivered totaling just over 300,000 SF. Cap rates
have averaged 7.90%.
Industrial
Houston, Texas $5.31 $7.14 7.0%

Houston’s retail market has experienced a decrease in vacancy to 9.2% overall, but the Corpus Christi, Texas $4.80 $6.00 4.0%
average quoted asking rental rate still dropped to $15.15/SF, a 1.9% decrease over the San Antonio, Texas $4.40 $6.00 12.8%
past year. Average sales prices rose year over year to $171/SF, compared with $147 in the Austin, Texas $4.20 $5.40 20.0%
previous period.
Manufacturing

Industrial
Beaumont, TX $6.30 $7.00 6.0%

Oklahoma City, Oklahoma $5.75 $9.25 14.0%
Austin, Texas $5.70 $7.20 20.0%
Houston, Texas $5.17 $7.80 3.0%

High Tech/R&D
Texarkana $14.50 $16.00 0.0%

Industrial

Wichita, Kansas $10.00 $11.00 5.6%
Beaumont, TX $9.00 $10.00 5.0%

US Highlights – West Region
Arizona Nevada Leading Price Class A Markets
California New Mexico
Colorado Oregon Market Effective Avg. High Rent Vacancy
Downtown Office
Hawaii Utah Santa Clara County (Silicon Valley), California $43.44 $85.20 24.1%
Class A
Idaho Washington San Francisco County, California $36.42 $70.00 14.4%
Montana Wyoming Los Angeles County, California $34.19 $52.54 13.7%
Sacramento, California $34.08 $39.60 9.6%
Jackson Hole, Wyoming $32.50 $35.00 10.0%
San Diego, California $31.50 $36.00 18.0%
Office
The entertainment industry, a primary component of the Los Angeles market, has weathered Market Effective Avg. High Rent Vacancy
Suburban Office
the economic crisis well, but demand is off in most other sectors. Tenants are giving back excess Santa Clara County (Silicon Valley), California $35.60 $78.96 23.9%
Class A
space and renegotiating leases to reduce their operating costs. Higher vacancy rates, lower San Mateo County, California $35.04 $162.00 18.7%
lease rates and tight credit have almost eliminated new construction. Los Angeles County, California $32.67 $77.40 14.8%
Marin County, California $30.96 $60.00 27.9%
The office vacancy rate in Phoenix is 25% overall, but vacancy at Class A+ product downtown
Ventura County, California $30.00 $35.00 19.6%
and in suburban submarkets has reached a staggering 60%. Relief won’t come anytime soon
with over 2 million SF currently under construction.
Portland office vacancy increased considerably during 2009, but Class A space in the CBD Leading Price Retail Markets
remained tight at around 6%. No new CBD projects will deliver until summer 2010.
Positive net absorption of almost 300,000 SF of office space in San Diego in Q3 provided some
welcome positive news in an otherwise very difficult year. Investment activity is well off the 2007
San Francisco County, California $76.33 $750.00 6.7%
Downtown
peak in velocity and volume. Excluding buildings under 15,000 SF, sale prices in 2009 averaged
Retail
Santa Clara County (Silicon Valley), California $48.00 $72.00 7.6%
$140/SF, down from $230/SF in 2008.
Seattle, Washington $42.00 $65.00 8.1%
The San Francisco commercial market remained plagued by rising vacancy, declining rents and San Diego, California $33.33 $60.00 6.6%
occupancy loss with the September 2009 preliminary unemployment rate reaching 10.4%. The Los Angeles County, California $32.61 $45.24 4.6%
market-wide vacancy rate rose to 15.3% at the end of Q3 with nearly 1.7 million SF of nega-
tive absorption year to date. Rental rates dropped $3.75 to $33.01/SF full service. Market Effective Avg. High Rent Vacancy
San Mateo office vacancy peaked above 18% in 2009, climbing 680 basis points from 2008. Service Centers San Francisco County, California $45.06 $65.00 3.6%
Retail
The average asking rate decreased a dramatic $10.32 in the past year to $31.92/SF full serv-
ice per year. Since 2007, nearly 5.7 million SF of office space has been absorbed from San San Mateo County, California $33.66 $54.00 3.8%
Mateo County's available marketplace. Ventura County, California $25.70 $39.00 9.1%
Los Angeles County, California $25.31 $41.68 6.8%
Industrial
Denver’s vacancy rate is nearing 9%. The good news is there are several large transactions
Power Centers

in the market, which should fill some voids that have been created due to the downturn in
Retail

the economy.
Las Vegas industrial inventory grew to 103 million SF, pushing the vacancy rate beyond 12%. San Mateo County, California $27.49 $45.00 5.1%
Current vacancies are significantly higher than the 10-year historical average of 8%. Speculative Seattle, Washington $27.00 $38.00 5.0%
development in the sector remains limited while net absorption remained negative throughout
the year. Market Effective Avg. High Rent Vacancy
Regional Malls
Offsetting Los Angeles’ gains in entertainment are losses in international trade. Total shipments Santa Clara County (Silicon Valley), California $85.00 $125.00 12.0%
through September at the Port of Long Beach decreased 24.6 % from the previous year, and San Francisco County, California $71.37 $150.00 1.5%
Retail
contributed to rising vacancy and weakening rents in the L.A. County industrial sector. Phoenix, Arizona $50.00 $80.00 10.0%
Demand for industrial space in Reno was down for the third consecutive year and the vacancy Albuquerque, New Mexico $42.00 $50.00 22.8%
rate reached an all-time high above 15%. Even with virtually no speculative development Seattle, Washington $39.00 $90.00 4.8%
during 2009, occupancy receded by more than 3% (almost 2 million SF) and effective rents
dropped 15% to 25%, with a concomitant decrease in property values.
Retail
In December 2009, MGM Mirage’s $8.5 billion CityCenter mixed-use development debuts with Market Effective Avg. High Rent Vacancy
Bulk Warehouse
18.5 million SF of resort and residential development along the famous Las Vegas Strip. The Ventura County, California $15.00 $10.80 5.9%
Industrial
property is expected to act as a catalyst for increased visitation, which should have rippling Marin County, California $13.80 $15.60 10.0%
effects throughout the local economy. San Mateo County, California $9.48 $18.00 13.5%
San Francisco County, California $9.12 $16.20 5.1%
While economic conditions in Los Angeles County remain weak, one bright spot is discount
retailers such as Big Lots, Dollar Tree, 99 Cents Only and Wal-Mart, continue to expand.
Retail landlords in Phoenix have been aggressive with rental rates and concessions for both Market Effective Avg. High Rent Vacancy
Manufacturing
new and existing tenants. In spite of those efforts, overall vacancy has risen from 10.3% at the Marin County, California $13.80 $15.60 10.0%
Industrial
beginning of 2009 to the current level of 11%. New construction has exacerbated the problem Ventura County, California $12.60 $7.80 6.3%
with 2.8 million SF added over the past year and another 1 million SF is due to delivered by Santa Cruz County, California $10.08 $16.20 5.4%
mid-2010. San Diego, California $9.24 $18.00 10.9%
San Mateo County, California $9.24 $18.00 11.0%

High Tech/R&D
San Mateo County, California $27.96 $45.00 16.1%

Industrial

Santa Cruz County, California $12.24 $18.60 14.7%
Las Vegas, Nevada $12.00 $18.00 18.0%

Asia Pacific
SECTION CONTENTS
Melbourne, Australia Hyderabad, Pradesh, India
Beijing, China Kolkata, India
Chengdu, China Pune, India
Hong Kong, China Punjab, India
Shanghai, China Tokyo, Japan
Xiamen, China Kuala Lumpur, Malaysia
Guam Seoul, South Korea
Chennai, India Taipei, Taiwan
Delhi, Gurgaon, India Singapore

Melbourne, Australia Beijing, China
In mid-2009, investors are again showing interest in Beijing’s economic growth declined slowly in 2009 due to
Australia’s retail property sector. The market has been the global financial crisis. In Q2 2009, Beijing’s GDP
educated by recent transactions in respect to possible re- increased by 7.8% year-over-year. Until August 2009, total
turns, and investors are now actively seeking retail assets fixed asset investment in Beijing increased by 44.3% year-
around the country with the realization that conditions are over-year. Investment in real estate development increased
becoming increasingly favorable. As signs of improving global by 44.2% year-over-year. The consumer price index de-
and local economic conditions emerge, private investors and clined by 1.5%.
owner occupiers are leading activity levels within Melbourne’s As the support industry of china’s economy, the real estate
industrial market. industry is also confronted with severe challenges and
Following a subdued first quarter, sales volumes increased threats. Despite the government’s series of preferential
during the last three months where more than 70% of policies, such as lowering interest rates and cutting taxes,
investment sales transactions occurred. Investor demand most consumers still adopted a wait-and-see attitude,
for quality assets in prime locations with long term leases in which caused a drop in demand for properties and a decline
place is expected to continue during the second half of in prices.
2009. Overall, rents for prime facilities softened by 13% The office market was affected by the global financial crisis
across Melbourne as a result of decreased demand. In an and greatly increased new supplies. The overall vacancy rate
Contact effort to secure tenants, landlords increased incentive Contact
in the Beijing office market maintained an upward tendency
NAI Melbourne levels by an average of 3%, now averaging 16% for prime NAI Imperial Real Estate
in 2009 and rental rates showed a sharp decline, especially
+61 3 9670 1255 buildings and 18% for secondary properties. Rents and +86 10 5870 0399
in the CBD. Even though rental rates dropped by 15%, the
incentive levels are now expected to stabilize across overall vacancy rate is still trending upward.
Melbourne, with the exception of the South East region,
where it is likely landlords will further increase incentives In addition, because of the economic decline, the retail and
and soften rents to secure tenants. industrial markets are still in a negative state. In the invest-
ment sector, declining property prices and a generally
The Australian economy has slowed significantly and 2009 favorable outlook for the Chinese market led to a significant
will be remembered as the year when the global economic volume of transactions registered in 2009. But the main
crisis had its full impact on the local economy. Currently, investors have changed from the original foreign buyers to
access to finance is still a barrier for many domestic buyers.
Country Data investors. However, market conditions have shifted and the Country Data*
risk premiums for investments in commercial property have In the residential market, although sale prices decreased,
Area (KM2) 1334.3 increased notably. Investors in the current market are Area (KM2) 9,596,960 sales volume did not increase substantially. However, since
assessing their property requirements and necessary the government’s relaxation of policies in the resale housing
GDP Growth (%) 0.73% investment returns. Transactions above US $100 million will GDP Growth (%) 7.7% market, the residential market has now become very active.
be limited in the near future. However, the level of Because of the relatively large new supply, rental rates and
GDP 2009 (US$ B) $920.01 activity is expected to increase considerably in late 2009. GDP 2009 (US$ B) $3189.12 overall vacancy rates are not expected to return to the
It is expected that the retail investment sector will see the previous strong level. However, with high expectations and
GDP/Capita (US$) $41,981.70 majority of transactions occur for neighborhood and GDP/Capita (US$) $2,390.11 confidence in Beijing from both home and abroad, the
sub-regional center types in the price bracket of US $10 demand for different types of properties should continue
Inflation Rate (%) 1.63% million - $60 million in the next 12 months. Inflation Rate (%) -1.1% to increase.
Unemployment 6.0% Unemployment 4.3%

Rate (%) Rate (%)
Interest Rate(%) 3.5% Interest Rate(%) 5.4%
Population (Millions) 21.915 Population (Millions) 1334.3

*National Bureau of Statistics of China
in 3Q2009
Melbourne At A Glance Beijing At A Glance

Conversion: 1.30 AUD = 1 US$ RENT/M2/MO US$ RENT/SF/YEAR Conversion: 6.83 RMB = 1 US$ RENT/M2/MO 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 500.00 $ 39.07 $ 43.41 4.0% New Construction (AAA) RMB 2,160.00 RMB 2,520.00 $ 29.38 $ 34.28 60.0%
Class A (Prime) AUD 400.00 AUD 450.00 $ 34.73 $ 39.07 5.0% Class A (Prime) RMB 1,740.00 RMB 4,320.00 $ 23.67 $ 58.76 10.0%
Class B (Secondary) AUD 300.00 AUD 350.00 $ 26.05 $ 30.39 6.0% Class B (Secondary) RMB 794.00 RMB 1,440.00 $ 10.80 $ 19.59 15.0%
SUBURBAN OFFICE SUBURBAN OFFICE
New Construction (AAA) AUD 250.00 AUD 270.00 $ 21.71 $ 23.44 5.0% New Construction (AAA) RMB 2,400.00 RMB 3,300.00 $ 32.65 $ 44.89 40.0%
Class A (Prime) AUD 220.00 AUD 230.00 $ 19.10 $ 19.97 5.0% Class A (Prime) RMB 1,680.00 RMB 3,600.00 $ 22.85 $ 48.97 10.0%
Class B (Secondary) AUD 180.00 AUD 190.00 $ 15.63 $ 16.50 7.0% Class B (Secondary) RMB 840.00 RMB 1,560.00 $ 11.43 $ 21.22 13.0%
INDUSTRIAL INDUSTRIAL
Bulk Warehouse AUD 130.00 AUD 40.00 $ 11.29 $ 12.16 6.0% Bulk Warehouse RMB 216.00 RMB 540.00 $ 2.94 $ 7.35 N/A
Manufacturing AUD 130.00 AUD 140.00 $ 11.29 $ 12.16 9.0% Manufacturing RMB 216.00 RMB 468.00 $ 2.94 $ 6.37 N/A
High Tech/R&D AUD 150.00 AUD 160.00 $ 13.02 $ 13.89 5.0% High Tech/R&D RMB 648.00 RMB 1,008.00 $ 8.81 $ 13.71 N/A
RETAIL RETAIL
Downtown AUD 800.00 AUD 900.00 $ 69.46 $ 78.14 3.0% Downtown RMB 3,000.00 RMB 14,880.00 $ 40.81 $ 202.40 13.0%
Neighborhood Service Centers AUD 450.00 AUD 500.00 $ 39.07 $ 43.41 6.0% Neighborhood Service Centers RMB 420.00 RMB 1,620.00 $ 5.71 $ 22.04 25.0%
Community Power Center N/A N/A N/A N/A N/A Community Power Center RMB 300.00 RMB 1,920.00 $ 4.08 $ 26.12 17.0%
Regional Malls AUD 1,700.00 AUD 2,000.00 $147.60 $173.65 2.0% 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 1,080.00 RMB 7,560.00 $ 14.69 $ 102.83 9.0%
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
Office in CBD N/A N/A N/A N/A Office in CBD RMB 5,990.00 RMB 12,905.00 $ 81.48 $ 175.53
Land in Office Parks AUD 150.00 AUD 160.00 $ 140.19 $ 149.53 Land in Office Parks RMB 3,745.00 RMB 9,975.00 $ 50.94 $ 135.68
Land in Industrial Parks AUD 110.00 AUD 120.00 $ 102.80 $ 112.15 Land in Industrial Parks RMB 395.00 RMB 4,594.00 $ 5.37 $ 62.49
Office/Industrial Land - Non-park AUD 120.00 AUD 130.00 $ 112.15 $ 121.50 Office/Industrial Land - Non-park RMB 8,840.00 RMB 14,840.00 $ 120.24 $ 201.85
Retail/Commercial Land AUD 850.00 AUD 900.00 $ 794.39 $ 841.12 Retail/Commercial Land RMB 4,407.00 RMB 15,270.00 $ 59.94 $ 207.70
Residential AUD 1,400.00 AUD 1,500.00 $1,308.41 $1,401.87 Residential RMB 1,079.00 RMB 14,920.00 $ 14.68 $ 202.94
2010 Global Market Report I www.naiglobal.com 27

Chengdu, China Hong Kong, China
The capital city of the Sichuan province and a key commercial Buffered by low levels of real estate debt and by capital
center in western China, Chengdu maintained the trend of inflows from China, Hong Kong did not see a contraction in
rapid growth in 2009 despite the current economic its real estate markets until October 2008. However,
situation. According to statistics published by the Chengdu the steep decline in Q4 2008 continued into 2009, as
Statistical Bureau, by the end of Q3 2009, the city’s GDP Hong Kong’s GDP growth contracted by 7.8% in Q1. With
amounted to RMB 316.46 billion, up 14.2% compared with the government’s announced stimulus package of HK
the same period in 2008.Invetsment in fixed assets totaled $87.6 billion (approximately 5.2% of GDP), the contraction
RMB 290.58 billion, up 40% compared with the same decreased to -3.8% in Q2 2009 and helped stabilize the
period in 2008. Meanwhile, the consumer price index markets, coupled with a change in global sentiment.
increased 0.1% in Q3, up 0.3% over the previous quarter. Commercial real estate followed a similar pattern. Rents
During the last three quarters, total investment in fixed across all sectors declined 20-30% from their peaks in
assets in Chengdu reached RMB 29.058 billion, up 40%. Q3 2008, and began to stabilize in the second half of 2009.
Investment in commercial and residential development and In the office market, Lehman Brothers’ collapse triggered
real estate sales is strong and continuing to increase. a rapid contraction and relocation of the financial sector,
According to statistics, during the first nine months of 2009, creating a surge in CBD vacancies to 8% and a 30% decline
overall investment in Chengdu totaled RMB 15.705 billion, in rents. However, the historically limited supply of prime
Contact an increase of 73.6%, outpacing the increase of investment Contact offices led some replacement tenants to move into the CBD
NAI New Space Real in fixed assets by 33.6%. Sales of commercial real estate NAI Asia Pacific once liquidity returned in mid-2009 and vacancies fell to 5%.
Estate Co., Ltd. in the city reached 1.8 million SM, up 73.6%; and sales of Properties, Ltd. Industrial demand fell sharply in the first half of 2009 as the
+86 28 6653 6999 residential real estate reach 1.7 million SM, up 40% compared + 852 2281 7800 trade and logistics sectors suffered, though rents fell by only
with the same period in 2008. 20% from already low levels. Exits from the industrial
The Chengdu market has a total inventory of approximately investment sector by several prominent institutions and
continued high vacancies have dampened the rebound in
460,000 SM of Class A space and 891,000 SM of Class B
capital values. The crisis also triggered several retail chain
space. Office vacancy rates continue to decline and currently
consolidations and rents fell by 20% in the first half of the
stand at 23.1%. However, leasing activity has slowed and
year. Supported by the return of Mainland Chinese tourists,
net rental rates for top quality space has come down to
rents and value in core districts have rebounded to pre-crisis
attract and retain tenants. In the short term, we expect the levels during the second half of 2009.
Country Data leasing market will be stable in Grade A office space and Country Data
Area (KM2) 1334.3 vacant space will be absorbed. However, a large number of Area (KM2) 1334.3 From an investment perspective, high yields of 6-7% in Q4
new office developments will add to the existing supply 2008 triggered speculative purchases of over HK $4 billion
GDP Growth (%) 8.5% in Chengdu from 2010 to 2011. Over 740,000 SM are GDP Growth (%) 8.5% of assets in Q2 and Q3 2009, with yields dropping to 3.5%.
expected to be delivered over the next three years. Capital values rebounded 30% despite continued declines
GDP 2009 (US$ B) $4,757.74 GDP 2009 (US$ B) $4,757.74
in rents and yields. Conversely, in early Q4 2009 rents began
The industrial sector is driven by Chengdu’s location and stabilizing while capital values showed signs of weakening.
rising prominence as a hub city for logistics/distribution, and This paradox highlights the volatile nature of Hong Kong’s
GDP/Capita (US$) $3,565.73 the retail market is dominated by department stores and big GDP/Capita (US$) $3,565.73
real estate market, which does not always follow current
box retailers. fundamentals, but rather a mix of long term sentiment and
Inflation Rate (%) -0.06% Inflation Rate (%) -0.06% near term speculation, while heavily influenced by capital
All property sectors in Chengdu should continue to benefit
from a growing headquarters presence of multinational inflows from China.
Rate (%) companies, along with economic development efforts and Rate (%) At the end of 2009 the outlook for 2010 was mixed, with
preferential policies designed to boost investment in the city market pundits promoting a 5-15% recovery in 2010, despite
and the region. economists worldwide predicting a weak global economy and
Population (Millions) 1334.3 Population (Millions) 1334.3 bubble-like symptoms in Hong kong and China. Our view
is that long term investment into China will support HK’s
economy and real estate market and any retraction will be
limited in 2010.
Chengdu At A Glance Hong Kong At A Glance

Conversion: 6.83 RMB = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 7.75 HKD = 1 US$ RENT/SF/MO US$ RENT/SF/YR
New Construction (AAA) RMB 1,380.00 RMB 1,440.00 $ 18.77 $ 19.59 N/A New Construction (AAA) HKD 80.00 HKD 120.00 $ 0.96 $ 1.44 5.0%
Class A (Prime) RMB 1,380.00 RMB 1,440.00 $ 18.77 $ 19.59 N/A Class A (Prime) HKD 45.00 HKD 105.00 $ 0.54 $ 1.26 8.0%
Class B (Secondary) RMB 648.00 RMB 720.00 $ 8.81 $ 9.79 N/A Class B (Secondary) HKD 20.00 HKD 50.00 $ 0.24 $ 0.60 10.0%
New Construction (AAA) RMB 1,080.00 RMB 1,200.00 $ 14.69 $ 16.32 N/A New Construction (AAA) HKD 25.00 HKD 40.00 $ 0.30 $ 0.48 25.0%
Class A (Prime) RMB 1,080.00 RMB 1,200.00 $ 14.69 $ 16.32 N/A Class A (Prime) HKD 20.00 HKD 25.00 $ 0.24 $ 0.30 10.0%
Class B (Secondary) RMB 540.00 RMB 600.00 $ 7.35 $ 8.16 N/A Class B (Secondary) HKD 12.00 HKD 15.00 $ 0.14 $ 0.18 15.0%
Bulk Warehouse RMB 108.00 RMB 120.00 $ 1.47 $ 1.63 N/A Bulk Warehouse HKD 8.00 HKD 15.00 $ 0.10 $ 0.18 15.0%
Manufacturing RMB 108.00 RMB 120.00 $ 1.47 $ 1.63 N/A Manufacturing HKD 10.00 HKD 15.00 $ 0.12 $ 0.18 10.0%
High Tech/R&D RMB 432.00 RMB 480.00 $ 5.88 $ 6.53 N/A High Tech/R&D HKD 15.00 HKD 20.00 $ 0.18 $ 0.24 15.0%
RETAIL RETAIL
Downtown RMB 432.00 RMB 480.00 $ 5.88 $ 6.53 N/A Downtown HKD 250.00 HKD 800.00 $ 3.00 $ 9.59 3.0%
Neighborhood Service Centers RMB 648.00 RMB 720.00 $ 8.81 $ 9.79 N/A Neighborhood Service Centers HKD 50.00 HKD 100.00 $ 0.60 $ 1.20 15.0%
Community Power Center RMB 648.00 RMB 720.00 $ 8.81 $ 9.79 N/A Community Power Center HKD 25.00 HKD 40.00 $ 0.30 $ 0.48 10.0%
Regional Malls RMB 432.00 RMB 480.00 $ 5.88 $ 6.53 N/A Regional Malls HKD 100.00 HKD 300.00 $ 1.20 $ 3.60 5.0%
Solus Food Stores RMB 648.00 RMB 720.00 $ 8.81 $ 9.79 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 N/A N/A N/A N/A 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 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
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 N/A N/A N/A N/A

Shanghai, China Xiamen, China
During the first half of 2009, the overall Chinese economy Xiamen is not only ranked as the center of high-end
in general was dominated by a state of deflation character- consumption in the Golden Delta of South Fujian Province,
ized by a slide in consumer and producer prices. Beijing’s US but is also the bridgehead for dealing across the Taiwan
$586 billion stimulus package, coupled with Shanghai’s own Strait and Southeast Asia.
US $14.5 billion 2010 Expo expenditure, combined to mit- Land prices in Xiamen’s construction areas increased
igate the consequences of the downturn. sharply in 2009, influenced by the financial crisis; however,
A wave of new supply to the office market during the first housing sales and values saw a decrease early in the year
half of 2009 and declining demand fueled a rise in citywide with a rebound for both realized after August. The residential
vacancy rates as rental rates dropped by as much as market is currently operating with prices at higher levels
25% year-over-year. Although demand has improved, than in years past, resulting in fewer transactions. An adjust-
approximately 800,000 SM of office space arrived on the ment in price is predicted, which is expected to bring costs
market in 2009, and is likely to have a negative impact on down in both the housing and land sectors.
occupancy and rental rates in 2010. During a “wait-and- Xiamen has witnessed an increase in development of new
see” stance in the first half of 2009 by most Class A office buildings as well as high-end hotels during the
international organizations, the government adjusted its past few years. Although there continues to be sufficient
policies on allocating land. Vacancy rates increased supply, the leasing transactions of Class A office buildings
Contact with several companies, including Intel, closing offices or Contact
remain at a brisk pace in the CBD, especially in areas like
NAI Asia Pacific relocating outside of the CBD, and rental rates/prices NAI Derun
North Hubin Street and Lianyue Street. Room rates at both
Properties declined, particularly in the suburban areas of the city. The +86 592 5168098
high-end and mid-level hotels continue to rise.
+86 21 6288 7333 market registered increased activity in the second half of
the year, but did not affect the depressed market rates, In 2009, the Xiamen retail market encompassed a total of
which we expect to persist into most of 2010. 3.5 million SM of space with 43,000 retail units/stores, or
about 1.44 SM per capita. The strongest demand is in the
Demand throughout 2009 was steady in the retail market high-end luxury niche segment, where space fills up very
compared to other sectors with minor reductions in quickly even though there are many new projects opening
price/rentals and occupancy rates. Limited new supply of to accommodate the demand. Among the new high-end
prime space in the run-up to Expo 2010 is likely to cause luxury centers are the 12,000 SM Paragon shopping mall,
increases in prices/rentals for most of 2010. Local which opened in December 2008 as part of a 100,000 SM
Country Data investors dominated the market, especially at the start of Country Data
Area (KM2)
mixed-use development, and the 110,000 SM SMII Life
Area (KM2) 6.345 2009 when valuations were attractive. The Exchange in Puxi 1334.3
Style shopping mall, which opened in October 2009. Several
and the Pufa Tower in Pudong were sold to local luxury brands entered the Xiamen retail market for the first
GDP Growth (%) 8.5% investors. It was only during the second half of 2009 that GDP Growth (%) 8.5%
time in 2009, including Gucci, Versace, Prada, Armani,
more conservative foreign financial institutions began to Hermes and Montblanc.
GDP 2009 (US$ B) $4,757.74 show interest again in the real estate market. GDP 2009 (US$ B) $4,757.74
Industrial parks saw an increase in activity, keeping many
The stimulus package, 2010 Expo expenditure and tax tenants from moving from downtown (Xiamen Island) to the
GDP/Capita (US$) $3,565.73 rebates combined to reduce Shanghai’s economic fallout GDP/Capita (US$) $3,565.73
suburban areas like Haicang, Jimei, Xiang’an and Tong’an
from a sharp decline in exports during 2009. However, these districts. The municipal industrial development bureau
Inflation Rate (%) -0.06% packages cannot fully support the export-oriented economy Inflation Rate (%) -0.06%
continued to focus on attracting technology, automotive,
indefinitely and what the post-stimulus future holds for logistics, manufacturing and high-end agriculture to the
Unemployment 4.3% Shanghai's economy and real estate remains to be seen. Unemployment 4.3%
Rate (%) Rate (%) suburban area.
Interest Rate(%) 5.31% Interest Rate(%) 5.31% Office rental rates are staggeringly high, which reflects the
increased demand for Class A and B office buildings. After
Population (Millions) 1334.3 Population (Millions) 1334.3 the increase in the housing market after August 2009,
prices are expected to adjust to a stable level in 2010.
Shanghai At A Glance Xiamen At A Glance

Conversion: RMB 6.82 = 1 US$ RENT/M2YR US$ RENT/SF/YR Conversion: 6.82 RMB = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) RMB 1,640.00 RMB 2,920.00 $ 22.34 $ 39.78 60.0% New Construction (AAA) RMB 14.00 RMB 23.00 $ 15.61 $ 25.64 5.0%
Class A (Prime) RMB 1,460.00 RMB 3,066.00 $ 19.89 $ 41.77 18.0% Class A (Prime) RMB 15.00 RMB 28.50 $ 16.72 $ 31.77 N/A
Class B (Secondary) RMB 1,095.00 RMB 2,190.00 $ 14.92 $ 29.83 10.0% Class B (Secondary) RMB 8.00 RMB 15.00 $ 8.92 $ 16.72 3.0%
New Construction (AAA) RMB 1,022.00 RMB 1,643.00 $ 13.92 $ 22.38 N/A New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) RMB 912.00 RMB 1,570.00 $ 12.42 $ 21.39 N/A Class A (Prime) RMB 7.00 RMB 13.00 $ 7.80 $ 14.49 8.0%
Class B (Secondary) RMB 657.00 RMB 800.00 $ 8.95 $10.90 N/A Class B (Secondary) RMB 5.00 RMB 10.00 $ 5.57 $ 11.15 10.0%
Bulk Warehouse RMB 255.00 RMB 438.00 $ 3.47 $ 5.97 30.0% Bulk Warehouse RMB 1.00 RMB 3.50 $ 1.11 $ 3.90 15.0%
Manufacturing RMB 183.00 RMB 365.00 $ 2.49 $ 4.97 N/A Manufacturing RMB 1.00 RMB 3.00 $ 1.11 $ 3.34 28.0%
High Tech/R&D RMB 365.00 RMB 1,460.00 $ 4.97 $ 19.89 N/A High Tech/R&D RMB 5.20 RMB 13.80 $ 5.80 $ 15.38 10.0%
RETAIL RETAIL
Downtown RMB10,950.00 RMB 16,425.00 $ 149.16 $ 223.74 N/A Downtown RMB 70.00 RMB 180.00 $ 78.04 $ 200.67 2.0%
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers RMB 10.00 RMB 55.00 $ 11.15 $ 61.32 8.0%
Community Power Center N/A N/A N/A N/A N/A Community Power Center (Big Box) RMB 5.00 RMB 25.00 $ .57 $ 27.87 12.0%
Regional Malls $ 109.00 $ 437.00 $ 14.85 $ 59.53 N/A Regional Malls RMB 48.00 RMB 65.00 $ 53.51 $ 72.46 9.0%
Solus Food Stores N/A N/A N/A N/A N/A Solus Food Stores RMB 6.00 RMB 35.00 $ 6.69 $ 39.02 23.0%
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre
Land in Office Parks RMB 1,500.00 RMB 2,000.00 $ 219.94 $ 293.26 Land in Office Parks) N/A N/A N/A N/A
Land in Industrial Parks RMB 450.00 RMB 2,000.00 $ 65.98 $ 293.26 Land in Industrial Parks N/A N/A N/A N/A

Guam Chennai, India
Massive construction is expected to take place to accommo- Commercial real estate transactions, considered a key
date the transfer of approximately 8,000 US Marines and indicator of economic activity in Chennai, began showing the
9,000 military dependents plus support personnel from first signs of stability with over 1.7 million SF of space having
Okinawa to Guam by 2015. Island population is projected been absorbed in Chennai during the first three quarters of
to grow as much as 25% over the five-year period. In 2009. Suburban markets of Manapakkam, Perungudi and
anticipation of the build-up, more than 15,000 foreign Ambattur continue to be most favored by companies because
laborers, primarily from the Philippines and South East of proximity and quality space available.
Asia, are in Guam, representing the first wave of popula- The commercial real estate market in 2009 saw a decline
tion growth. in rentals, lower absorption and increasing vacancy rates.
Meanwhile, Guam continues to remain one of the most Following the financial turmoil, a paradigm shift in the
popular tourist destinations for the Asian markets, primarily perception of risk was witnessed, resulting in a weakening
for the Japanese and Koreans. Industry experts continue to of demand, the slow-down of expansion plans and migration
debate the impact of the construction and military build-up to more cost-effective locations, all of which put pressure on
on the island’s allure as a resort destination. The growth is lease rentals.
expected to result in pent up demand for industrial, residential A pick-up in inquiries for space from the hospitality, health-
and office products, in this order. Hotels and shopping care and educational sectors was witnessed in Q2 and Q3.
Contact centers should also see an immediate benefit from the influx Contact
Residential land transactions saw more activity in Q2 and
NAI ChaneyBrooks of new residents and transient workers. Guam’s office NAI Hemdev's
Q3 in central areas of the city for fairly priced properties by
+1 671 649 8742 market is expected to gradually show steady gains as International Realty
Services end-users.
contractors and government-related offices begin setting up
operations in the island. Due to the lack of quality office +91 44 2822 9595 Most retail micro markets saw a correction in rental
product, the market will be ripe for new office building values in line with the downward rental trends witnessed in
development, especially in the Hagatna and Tamuning India. There has been a slight upward trend in the
regions. Until new inventory is introduced, the demand for number of inquiries for retail space since Q2 with retailers
office property should begin to drive up office rents. taking into account the corrections seen in rentals, and land-
lords being more open to reasonable prices.
Guam’s future looks bright and continues to benefit from a
general sense of optimism from both opportunistic US and One of the highlights in the retail market in Chennai was the
Country Data foreign investors. Over the course of the next three years Country Data opening of The Ampa Skywalk Mall. Mall space supply is set
Area (KM2) 1334.3 Guam’s real estate market should prove to be one of the Area (KM2) 1334.3 to increase in 2010 with the opening of Express
most stable markets in the United States. Avenue and Coromandel Plaza. The market for return on
GDP Growth (%) N/A GDP Growth (%) 5.36% investment properties saw a pick up with buyers scouting for
tenanted office spaces as the prices reached realistic levels.
GDP 2009 (US$ B) $2.70 GDP 2009 (US$ B) $1,242.65 With good quality supply readily available, it will take some
time for the supply-demand gap to be bridged. Therefore,
GDP/Capita (US$) $15,000.00 GDP/Capita (US$) $1,032.71 rates in the commercial real estate market are expected to
remain stagnant or under downward pressure for the
Inflation Rate (%) 2.50% Inflation Rate (%) 8.66% medium term.

Rate (%) Rate (%)
Interest Rate(%) N/A Interest Rate(%) 4.75%
Guam At A Glance Chennai At A Glance

(Rent/SF/YR) Low High Effective Avg. Vacancy Conversion: 46 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 70.00 $ 15.65 $ 18.26 N/A
Class B (Secondary) $ 26.00 $ 42.00 $ 28.20 18.0% Class A (Prime) INR 60.00 INR 75.00 $ 15.65 $ 19.57 N/A
SUBURBAN OFFICE Class B (Secondary) INR 35.00 INR 50.00 $ 9.13 $ 13.04 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 $ 6.52 $ 11.74 N/A
Class B (Secondary) $ 14.00 $ 36.00 $ 19.75 23.0% Class A (Prime) INR 25.00 INR 45.00 $ 6.52 $ 11.74 N/A
INDUSTRIAL Class B (Secondary) INR 20.00 INR 35.00 $ 5.22 $ 9.13 N/A
Bulk Warehouse $ 7.80 $ 18.00 $ 12.35 12.0% INDUSTRIAL
Manufacturing $ 7.80 $ 18.00 $ 12.35 12.0% Bulk Warehouse INR 12.00 INR 20.00 $ 3.13 $ 5.22 N/A
High Tech/R&D N/A N/A N/A N/A Manufacturing INR 17.00 INR 22.00 $ 4.43 $ 5.74 N/A
High Tech/R&D INR 18.00 INR 25.00 $ 4.70 $ 6.52 N/A
RETAIL
Downtown $ 33.00 $ 108.00 $ 72.00 16.0% RETAIL
Downtown INR 100.00 INR 150.00 $ 26.09 $ 39.13 N/A
Neighborhood Service Centers $ 13.00 $ 60.00 $ 31.00 N/A
Neighborhood Service Centers INR 50.00 INR 80.00 $ 13.04 $ 20.87 N/A
Community Power Center $ 9.60 $ 15.00 $ 11.25 N/A
Community Power Center N/A N/A N/A N/A N/A
Regional Malls $ 36.00 $ 72.00 $ 54.00 N/A
Regional Malls INR 35.00 INR 60.00 $ 9.13 $ 15.65 N/A
Solus Food Stores INR 39.00 INR 45.00 $ 10.17 $ 11.74 N/A
DEVELOPMENT LAND Low(Price/Acre) High(Price/Acre)
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD N/A N/A
Office in CBD INR 4,000 INR 6,000 $ 86.96 $ 130.43
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 INR 10,000,000 $ 69,565.22 $ 217,391.30
Office/Industrial Land - Non-park $ 753,000.00 $1,077,000.00
Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land $2,018,000.00 $2,023,000.00
Retail/Commercial Land INR 540,000,000 INR 720,000,000 $ 11,739,130.43 $ 15,652,173.91
Residential $ 108,000.00 $ 680,000.00
Residential INR 270,000,000 INR 600,000,000 $ 5,869,565.22 $13,043,478.26

Delhi, Gurgaon, India Hyderabad, Pradesh, India
The current real estate inventory in India is estimated to be With a projected growth ratio of around 7%, India is making
worth US $15 billion and anticipated to develop at the rate progress towards becoming one of the leading economies
of 25% annually in the coming decade due to the booming in the world over the next several years. Hyderabad, the fifth
economy, favorable demographics and liberalized Foreign largest city in the country, is on the radar for top IT, Pharma-
Direct Investment (FDI) regime. Economic recovery during ceutical and Aviation conglomerates in the world. NAI
2010-2011 is likely to revive the interest of foreign investors Hyderabad expects robust growth in 2010.
in India’s real estate market. Despite the global economic With a stable Government in place, the Hyderabad market is
downturn, India has been able to retain its position as a expected to stabilize and grow quickly over the next few years
preferred investment destination. due to a strong commitment from the Government
The economy is regaining momentum, with India adding up to improve basic infrastructure and connectivity. Major
to 40 million SF of office space by the end of 2009. The infrastructure projects such as the 262 KM Outer Ring Road
huge addition of new supply is expected to result in a (ORR), 13.5 KM elevated expressway, 22 KM eight lane
correction. The CBD witnessed a rise in vacancy levels due expressway connecting Gachibowli to Shamshabad, Metro
to high rental rates, limited and poor quality of buildings, Rail and Shamshabad International Airport have been instru-
relocation of companies to more cost effective options or mental in making Hyderabad one of the leading cities in India.
lease renegotiations. As a result, the CBD witnessed Commercial real estate transactions have seen a substantial
Contact a correction in rental rates back to more realistic levels. Contact
increase post elections and are expected to stabilize with
NAI Collaborators India Outlying areas are becoming more viable and NAI Hyderabad
better occupancy rates in the coming months. The post
+91 11 4668 7000 demand is increasing due to better Metro connectivity. +91 40 233105712
election months have seen a rush in the end user market in
Upcoming areas like Saket & Jasola, witnessed the delivery the segment of 2 BHK and 3 BHK with sales happening in
of a large amount of new office space, thereby escalating the mid-market segment of prices between US $1.5 million
the vacancy level. Even Gurgaon and Noida witnessed an to US $5 million. The retail market in Hyderabad has
upsurge in the vacancy level due to an increase in the supply not seen a material increase or decrease in the past few
and the completion of various projects, along with availability quarters due to limited availability of new retail space and
of sublease options, thus keeping downward pressure on the current market slump. Despite the announcement of
the rental rates. more than 50 malls and retail buildings during the boom
The residential sector witnessed a fall due to the global period, only a few malls in Prasads, City Center, and GVK
Country Data Country Data have been successfully operational. Inorbit (the largest mall
Area (KM2) 1334.3
economic outlook in 2009, but is expected to pick up in Area (KM2) 1334.3
2010 due to a shortfall of over 25 million new homes, mostly in South India) and Night Bazar at Shilparamam are sched-
in the low and middle-income groups, leading to prices uled for launch in the near future.
GDP Growth (%) 5.36% GDP Growth (%) 5.36%
moving higher. Delhi’s retail market was slow in 2009 with The overall market scenario in Hyderabad is expected to be
just 10% of the transactions happening in the last few positive in the Corporate, IT, Pharmaceutical, medium cost
GDP 2009 (US$ B) $1,242.65 months. India’s retail market is expected to see the addition GDP 2009 (US$ B) $1,242.65 residential and Warehousing sectors. Negative trends are
of over 1 million SF with 100 new malls. expected in Land, Investment and Retail segments.
GDP/Capita (US$) $1,032.71 GDP/Capita (US$) $1,032.71
Revival is on its way in the real estate market, spurred by
price corrections, new launches and lowering of interest
Inflation Rate (%) 8.66% Inflation Rate (%) 8.66%
rates. The commercial market has also started showing
Unemployment
signs of revival, driven by a spurt in office space resulting in Unemployment
7.32% 7.32%
Rate (%) more conversions taking place in CBD and PBD areas with Rate (%)
initial rise in demand for less costly premises. Though most
of the deals that happened were of relocation. The office
Population (Millions) 1203.28
market is showing visible signs of renewal in demand. Population (Millions) 1203.28
Delhi At A Glance Hyderabad At A Glance

RENT/SF/YR RENT/SF/YR Conversion 50 Rs = 1 US$ RENT/M2/MONTH US$ NET RENT/SF/YEAR
Low High Low High Vacancy Low High Low/SF High/SF Vacancy
DOWNTOWN OFFICE DOWNTOWN OFFICE Rs 7,750.00 Rs 12,917.00 $ 15.56 $ 25.94 N/A
New Construction (AAA) $ 67.00 $ 73.00 $ 67.00 $ 73.00 25.0% New Construction (AAA) Rs 6,458.00 Rs 11,625.00 $ 12.97 $ 23.34 N/A
Class A (Prime) $ 60.00 $ 80.00 $ 60.00 $ 80.00 10.0% Class A (Prime) Rs 5,167.00 Rs 9,688.00 $ 10.37 $ 19.45 N/A
Class B (Secondary) $ 25.00 $ 53.00 $ 25.00 $ 53.00 15.0% Class B (Secondary)
SUBURBAN OFFICE SUBURBAN OFFICE Rs 6,458.00 Rs 9,042.00 $ 12.97 $ 18.15 N/A
New Construction (AAA) $ 29.00 $ 53.00 $ 29.00 $ 53.00 50.0% New Construction (AAA) Rs 5,813.00 Rs 7,750.00 $ 11.67 $ 15.56 N/A
Class A (Prime) $ 40.00 $ 53.00 $ 40.00 $ 53.00 20.0% Class A (Prime) Rs 3,875.00 Rs 5,813.00 $ 7.78 $ 11.67 N/A
Class B (Secondary) $ 21.00 $ 33.00 $ 21.00 $ 33.00 50.0% Class B (Secondary)
INDUSTRIAL INDUSTRIAL Rs 1,162.00 Rs 2,325.00 $ 2.33 $ 4.67 N/A
$ 3.00 $ 5.00 $ 3.00 $ 5.00 50.0% Bulk Warehouse Rs 1,292.00 Rs 2,583.00 $ 2.59 $ 5.19 N/A
Bulk Warehouse
$ 4.00 $ 12.00 $ 4.00 $ 12.00 40.0% Manufacturing Rs 1,550.00 Rs 3,229.00 $ 3.11 $ 6.48 N/A
Manufacturing
High Tech/R&D $ 4.00 $ 12.00 $ 4.00 $ 12.00 40.0% High Tech/R&D
RETAIL RETAIL Rs 12,917.00 Rs 32,292.00 $ 25.94 $ 64.84 N/A
Downtown $ 40.00 $ 160.00 $ 40.00 $ 160.00 20.0% Downtown Rs 9,688.00 Rs 16,146.00 $ 19.45 $ 32.42 N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers Rs 7,750.00 Rs 9,688.00 $ 15.56 $ 19.45 N/A
Community Power Center N/A N/A N/A N/A N/A Community Power Center Rs 7,750.00 Rs 11,625.00 $ 15.56 $ 23.34 N/A
Regional Malls $ 13.00 $ 67.00 $13.00 $ 67.00 20.0% 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
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low High Low/SF High/SF
Office in CBD Office in CBD Rs 435,600,000 Rs 580,800,000 $ 9,414,307.33 $12,552,409.77
$ 120.00 $ 180.00 $ 120.00 $180.00
Land in Office Parks $ 7,000,000 $ 14,000,000 $ 7,000,000 $ 14,000,000 Land in Office Parks Rs 290,400,000 Rs 363,000,000 $ 6,276,204.88 $ 7,845,256.11
Land in Industrial Parks $ 2,800,000 $ 8,400,000 $ 2,800,000 $ 8,400,000 Land in Industrial Parks Rs 96,800,000 Rs 145,200,000 $ 2,092,068.29 $ 3,138,102.44
Office/Industrial Land - Non-park $ 1,100,000 $ 1,900,000 $ 1,100,000 $ 1,900,000 Office/Industrial Land - Non-park Rs 72,600,000 Rs 121,000,000 $ 1,569,051.22 $ 2,615,085.37
Retail/Commercial Land $ 18,000,000 $ 19,000,000 $ 18,000,000 $ 19,000,000 Retail/Commercial Land Rs 338,800,000 Rs 435,600,000 $ 7,322,239.03 $ 9,414,307.33
Residential $ 250,000 $ 800,000 $ 250,000 $ 800,000 Residential Rs 193,600,000 Rs 290,400,000 $ 4,184,136.59 $ 6,276,204.88

Kolkata, India Pune, Maharashtra, India
With a population of more than 15 million people, Kolkata is Pune is strategically located 150 kilometers from Mumbai,
the world’s 8th largest and India’s third largest metropolitan the financial capital of India. The key drivers of this city stem
city. It is the capital of the Indian state of West Bengal and from the turbine industries like Alfa-Laval, Thermax, etc.
a main center for commerce and financial services in east- Bharat Forge is the world's second largest forging company.
ern India and northeastern states. The city is home to many Pune also is home to large IT companies like HSBC and
regional and corporate headquarters. Infosys. The auto industry and telecommunications sectors
The total office inventory in Kolkata is in excess of 26 million are on an upward trend, while IT remains reticent.
SF. About 85% of the inventory is in the suburban areas Pune has not escaped the effects of the global slowdown,
such as Topsia, Kasba, Sector-V and Rajarhat, including with rentals decreasing in the range of 10-40% .Vacancy
IT parks and IT SEZ’s. Downtown Class A office property rates reached a new high, the retail market crashed and the
rental rates have fallen from INR 150-160/SF per month in gloom of uncertainty spread fast even through the residential
September 2008 to INR 90-100/SF per month in September sector.
2009. Vacancy in Class A space in the CBD was at 4%, In Q3, Pune began to bounce back after a positive change
while Sector-V experienced 50% vacancy overall with rental in the economy. The markets were definitely abuzz with
rates of INR 40-45/SF per month. A significant portion of hectic shopping heralded by massive sales in gold. Lack of
the current office demand came from the telecom sector confidence in the market was replaced by vibrant buoyancy
Contact due to the telecom boom and recorded over 365,000 SF in Contact
and a spirit of cheer and celebration prevails. Genuine
NAI NK Realtors Pvt. Ltd. transactions since January 2009. NAI Property Terminus
investors are taking advantage of the market correction and
+91 33 24868016/ +91 20 25511900
7017/7519 The retail sector in Kolkata suffered the most over the last builders are threatening to hike rates. Finally, the much
12 months due to plunging sales and high occupancy costs. awaited stability is having an impact.
Rental values started falling in October 2008. Rental rates Some of the larger deals recorded in Pune were Synechron
in downtown mall space declined around 40% and average Technologies Pvt. Ltd in. Embassy for 75,000 SF, SEZ at
rentals in suburban malls fell around 17%. Hinjewadi TietoEnator at EON SEZ in Kharadi at 60,000 SF,
Kolkata’s residential market has experienced a moderate Aegis BPO at Commerzone in Yerwada with 50,000 SF, BNY
recovery since March 2009 due to the growing demand for Mellon at Magarpatta Cybercity in Hadapsar at 125,000 SF,
affordable housing. A number of such housing projects like and Sungard at EON SEZ in Kharadi with 60,000 SF.
Country Data Parvati Garden in Birati, Sugam Sabuj in Narendrapur and Country Data Construction that had been put on hold is now opening up
Area (KM2) 1334.3
Green Field City near Behala Chowrasta are coming up in Area (KM2) 1334.3 with new developments like ZerO 1ne at Ghorpadi; Prabhavee
the Kolkata market. Tech Park, Nano Space, Amar Synergy Connaught Road, and
GDP Growth (%) 5.36% Kolkata had been successful in pulling significant industrial GDP Growth (%) 7.90% Amar Paradigm at Baner; and several more. Pune’s future
investments over the last couple of years. But the exit appears to be bright in all commercial property sectors.
GDP 2009 (US$ B) $1,242.65 of TATA Motors small car project impacted the overall GDP 2009 (US$ B) $1,242.65 Pune is known as the Oxford of the east, boasting some
investment climate. In May 2009, the government’s proactive of the finest educational institutions, namely the highly
GDP/Capita (US$) $1,032.71
measures towards industrialization have brought Bengal GDP/Capita (US$) $1,032.71 regarded Pune University. Pune is the seventh largest metro
back into focus of global investors. city in India and has the highest per capita income in
Inflation Rate (%) 8.66% Inflation Rate (%) 8.66% the country.

Rate (%) Rate (%)
Kolkata At A Glance Pune At A Glance

Conversion: 46 INR = 1 US$ NET RENT/SF/MO US$ RENT/SF/YR Conversion: 45 INR = 1 US$ RENT/SF/MO US$ RENT/SF/YR
DOWNTOWN OFFICE CITY CENTER OFFICE
New Construction (AAA) INR 128.00 INR 156.00 $ 33.39 $ 40.70 25.0% New Construction (AAA) INR 45.00 INR 75.00 $ 12.00 $ 20.00 80.0%
Class A (Prime) INR 100.00 INR 111.00 $ 26.09 $ 28.96 4.0% Class A (Prime) INR 50.00 INR 60.00 $ 13.33 $ 16.00 40.0%
Class B (Secondary) INR 67.00 INR 100.00 $ 17.48 $ 26.09 5.0% Class B (Secondary) INR 35.00 INR 45.00 $ 9.33 $ 12.00 50.0%
New Construction (AAA) INR 50.00 INR 61.00 $ 13.04 $ 15.91 70.0% New Construction (AAA) INR 30.00 INR 50.00 $ 8.00 $ 13.33 55.0%
Class A (Prime) INR 45.00 INR 50.00 $ 11.74 $ 13.04 60.0% Class A (Prime) INR 50.00 INR 60.00 $ 13.33 $ 16.00 60.0%
Class B (Secondary) INR 39.00 INR 45.00 $ 10.17 $ 11.74 40.0% Class B (Secondary) INR 35.00 INR 45.00 $ 9.33 $ 12.00 72.0%
Bulk Warehouse INR 12.00 INR 20.00 $ 3.13 $ 5.22 25.0% Bulk Warehouse INR 12.00 INR 26.00 $ 3.20 $ 6.93 5.0%
Manufacturing N/A N/A N/A N/A N/A Manufacturing INR 18.00 INR 45.00 $ 4.80 $ 12.00 0.5%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D INR 18.00 INR 45.00 $ 4.80 $ 12.00 N/A
RETAIL RETAIL
Downtown INR 91.00 INR 245.00 $ 23.74 $ 63.91 15.0% Downtown INR 70.00 INR 150.00 $ 18.67 $ 40.00 15.0%
Neighborhood Service Centers INR 95.00 INR 145.00 $ 23.74 $ 63.91 14.0% Neighborhood Service Centers INR 70.00 INR 120.00 $ 18.67 $ 32.00 20.0%
Community Power Center INR 95.00 INR 162.00 $ 24.78 $ 42.26 71.0% Community Power Center INR 70.00 INR 120.00 $ 18.67 $ 32.00 25.0%
Regional Malls INR 123.00 INR 251.00 $ 32.09 $ 65.48 2.0% Regional Malls INR 60.00 INR 100.00 $ 16.00 $ 26.67 35.0%
Solus Food Stores INR 33.00 INR 39.00 $ 8.61 $10.17 N/A Solus Food Stores INR 100.00 INR 125.00 $ 26.67 $ 33.33 20.0%
DEVELOPMENT LAND Low/Acre High/Acre Low/SF High/SF
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
INR 420,000,000 INR 600,000,000 $ 209.61 $ 299.44 Office in CBD INR 6,000.00 INR 8,000.00 $ 133.00 $ 177.00
Office in CBD
INR 150,000,000 INR 200,000,000 $ 74.86 $ 99.81 Land in Office Parks INR 700.00 INR 5,000.00 $ 15.00 $ 111.00
Land in Office Parks
Land in Industrial Parks INR 50.00 INR 500.00 $ 1.00 $ 11.00
Land in Industrial Parks INR 15,000,000 INR 20,000,000 $ 7.49 $ 9.98
Office/Industrial Land - Non-park INR 3,000.00 INR 10,000.00 $ 67.00 $ 222.00
Office/Industrial Land - Non-park INR 12,000,000 INR 30,000,000 $ 5.99 $ 14.97
Retail/Commercial Land INR 1,200.00 INR 10,000.00 $ 27.00 $ 222.00
Retail/Commercial Land INR 400,000,000 INR 600,000,000 $ 199.62 $ 299.44
Residential INR 2,500.00 INR 8,500.00 $ 55.00 $ 189.00
Residential INR 12,000,000 INR 600,000,000 $ 5.99 $ 299.44

Punjab, India Tokyo, Japan
The past year in Punjab brought much anxiety as demand With the deepening decline in all sectors in 2009, real estate
in the real estate market fell sharply. The global economic markets in Japan’s key centers of Tokyo and Osaka have
meltdown and slowing demand, coupled with a liquidity remained in a depressed state. The inability for organizations
crisis, resulted in mega projects moving at a snail’s pace. to obtain loans, whether new or extensions on already
The first half of 2009 was even tougher than 2008 existing loans, has resulted in many large and small defaults
as demand across all sectors--commercial, retail and that have continued to only worsen an already stagnant
residential--continued to remain weak. In 2009, almost situation. A record number of developers have gone bank-
every developer had reported a decline in leases and sales rupt as lenders refuse to roll-over loans that had previously
in all markets. been readily available with easy terms.
The office market saw a downward trend with several Despite this, many sellers have remained quite defiant and
companies choosing to shut down operations. Even local the massive drop in sale prices that many had expected has
developers have closed their marketing offices at different not yet been realized. A relatively large amount of product
locations and many deferred their expansion plans, further has made its way to the market, yet much of it remains at
impacting rates and leading to a drop in rentals by 15%. pricing that is not appealing to many potential investors. The
Major industry in Punjab includes a wide range of products investor interest in the Japanese market, particularly in
from ready made garments and hosiery to machine tools Tokyo assets, has risen continually this year with many funds
Contact Contact poised to take advantage of opportunities that offer signifi-
and auto parts. This sector has seen a 45% dip in Q3 2009
NAI Space Alliance NAI Japan cant yields.
compared to last year.
+91 11 55854444 +81 3 5418 8747
The retail sector also felt the pinch of the economic slow- The remainder of 2009 will likely see an increase in trans-
down. High rentals in up-market locations in Punjab forced actions as the gaps between buyer and seller expectations
retailers to slow expansion and to shut down unproductive close. With the prevailing economic conditions there has
stores. Ludhiana, the industrial town of Punjab and the hub been a continuing low demand for rental of office, retail
of retail expansion, also showed signs of a slowdown with (particularly for medium to high-end imported brands),
fewer inquiries from retailers in Q3 2009. residential, industrial and hospitality properties. Rents have
been in a steady decline particularly in the retail and office
The price of residential properties also continued to decline sectors with terms becoming more and more favorable
in 2009. Reduced real estate rates, lower interest rates and for tenants. Class A office rents show evidence of this down-
Country Data better incentives for customers to purchase homes will go Country Data ward trend.
Area (KM2) 1334.3 a long way in rebuilding the entire real estate industry. The Area (KM2) 1334.3
remainder of 2009 saw customers who had deferred home Many major office buildings have relatively high levels of
purchases in 2008 take action and purchase homes given vacancy at 5.5 % for Class A office buildings and 5.8 % for
GDP Growth (%) 5.36% GDP Growth (%) -5.37%
the affordability of product on the market. Class B. As a result, after years of absence, free rent periods,
on top of already reduced rental rates, have returned to
GDP 2009 (US$ B) $1,242.65 Punjab carries good potential for the real estate sector in GDP 2009 (US$ B) $5,048.63 the market.
the long term. The past year was not excellent for this sector
GDP/Capita (US$) $1,032.71 as there was no demand at all. The impact of the economic GDP/Capita (US$) $39,573.49
slowdown is going to stay for another six months.
Inflation Rate (%) 8.66% Inflation Rate (%) -1.13%

Rate (%) Rate (%)
Punjab At A Glance Tokyo At A Glance

Conversion: 45 INR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion:90 JPY = 1 US$ RENT/M2/MO US$ RENT/SF/YR
CITY CENTER OFFICE DOWNTOWN OFFICE
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) JPY 6,667.00 JPY 12,727.00 $ 82.58 $ 157.65 N/A
Class A (Prime) INR 370.00 INR 540.00 $ 9.17 $ 13.38 18.0% Class A (Prime) JPY 5,455.00 JPY 12,120.00 $ 67.57 $ 150.13 5.5%
Class B (Secondary) INR 209.00 INR 301.00 $ 5.18 $ 7.46 16.0% Class B (Secondary) JPY 3,636.00 JPY 11,515.00 $ 45.04 $ 142.64 5.8%
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) JPY 6,969.00 JPY 8,789.00 $ 86.32 $ 108.87 N/A
Class A (Prime) N/A N/A N/A N/A N/A Class A (Prime) JPY 4,849.00 JPY 7,273.00 $ 60.06 $ 90.09 10.1%
Class B (Secondary) N/A N/A N/A N/A N/A Class B (Secondary) JPY 1,818.00 JPY 6,060.00 $ 22.52 $ 75.07 18.3%
Bulk Warehouse INR 126.00 INR 232.00 $ 3.12 $ 5.75 14.0% Bulk Warehouse JPY 1,045.00 JPY 3,203.00 $ 12.94 $ 39.68 N/A
Manufacturing N/A N/A N/A N/A N/A Manufacturing JPY 1,358.00 JPY 2,732.00 $ 16.82 $ 33.84 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 N/A N/A N/A N/A N/A Downtown JPY 5,890.00 JPY 18,023.00 $ 72.96 $ 223.25 N/A
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers JPY 4,385.00 JPY 8,770.00 $ 54.32 $ 108.63 N/A
Community Power Center INR 1,088.00 INR 1,586.00 $ 26.95 $ 39.29 11.0% Community Power Center JPY 3,775.00 JPY 7,260.00 $ 46.76 $ 89.93 N/A
Regional Malls INR 1,060.00 INR 1,836.00 $ 26.26 $ 45.48 15.0% Regional Malls JPY 1,890.00 JPY 3,500.00 $ 23.41 $ 43.35 N/A
Solus Food Stores N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low/SF High/SF Low/SF High/SF
Office in CBD N/A N/A N/A N/A Office in CBD JPY 6,330,000 JPY 67,000,000 $ 70,333.33 $ 744,444.44
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks JPY 330,000 JPY 1,500,000 $ 3,666.67 $ 16,666.67
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park JPY 786,000 JPY 5,790,000 $ 8,733.33 $ 64,333.33
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land JPY 1,700,000 JPY 36,340,000 $ 18,888.89 $ 403,777.78
Residential N/A N/A N/A N/A Residential (per M2) JPY 1,300,000 JPY 6,300,000 $ 14,444.44 $ 70,000.00

Kuala Lumpur, Malaysia Singapore
The dark clouds of late 2008 and early 2009 gave way In a concerted manner similar to other parts of Asia, Singapore
to optimism as the Kuala Lumpur market adjusted to the emerged from the recession that ended with the release of
current regional and global economies. An equities rally Q3 2009 economic data. The manufacturing sector expanded
midway through the year also aided the property market. by 35% quarter-over-quarter and the service producing
The economy continued to be driven by the service and industries expanded by 9%. However, the construction sector
manufacturing sector. The Malaysian Institute of Economic declined by 0.6%.
Research revised its forecast for 2009 GDP upward to a The office market in 2009 saw a sharp decline of almost 40-
contraction of 3.3% from 4.2%. A rise from the earlier 50% in prime office rental rates in the first half of the year
predicted 2.8% to a positive 3.7% is expected for 2010. stemming from the economic downturn. The decline of prime
Rental rates in the market were strong for newly launched office rentals moderated in Q3 2009. We forecast the decline
iconic buildings like UOA Bangsar (suburban) at RM 5.30 of prime office rentals in 2010 will moderate given the
and G Tower (CBD) at RM 6.50. The average occupancy in stronger economic momentum, even with greater office
Kuala Lumpur in the first half of 2009 was 83%. Roughly 12 supply coming on stream with MBFC, Asia Square and other
million SF of new space is expected to enter the market by new developments in 2010. Class A vacancy rose to 4% in
the end of 2010. Q2 2009, up from 3.5% in the previous quarter.
Contact Darul Takaful, Wisma Chase Perdana, Wisma Dijaya, Wisma Contact Large transactions in 2009 included the S $172 million
Glomac 3, Citibank Tower (50%) and Block B GBC transac- purchase of three separate office buildings in a collective
NAI Reapfield NAI Singapore
tions brought confidence to the office market, with the sale; Aviva Building, Ceil House and VTB Building with a total
+60 3 2713 3399 +65 63337738
Citibank Tower partial sale in August valued at RM 828/SF strate area of 185,019 SF at a cost of S$929 SF. Strata titled
and the Darul Takaful sale in March valued at RM 636/SF, floors in Prudential Towers at level 20 to 25 were sold to
indicating positive investor appetite. KREIT who paid S$106.29 million or S$1,579 SF.
The manufacturing sector embraced the challenges of In the retail market, Prime Orchard Road continues to trans-
reduced demand from major markets in Europe and the US. form and three major shopping centers will have opened by
Industrial properties saw a correction of 20-30% for Christmas 2009; ION Orchard, Orchard Central and 313
detached and semi-detached properties in the Klang Valley; Sommerset. There are major additions and renovations at
however, detached buildings in prime locations continued Park Hotel, Meritus Mandarin Hotel and 111 Sommerset
Country Data to attract interest. Country Data Road. Prime Orchard Road rent averaged S$33/SF/month in
Area (KM2)
Q3 2009, a decrease of 3.0% quarter over quarter. However,
Area (KM2) 1334.3 Retail rates experienced a 10-20% decrease. Average 1334.3
prime suburban rents inched up 0.7% quarter over quarter to
occupancy rates stood at 85-90%. An estimated 1 million average $28/SF/month in Q3 2009.
GDP Growth (%) -3.3% SF is expected to enter the already crowded Klang Valley GDP Growth (%) -3.33%
market in 2009 with an additional 2.3 million SF in 2010. The top five investments in 2009 were: SPA-led consortium
GDP 2009 (US$ B) $207.35 GDP 2009 (US$ B) $163.13 puts in a top bid of S$541.9m for a mall being developed in
The conditional sale of a prime 2.62-acre parcel of land clements by Housing & Development Board. UOL’s successful
along Jalan Ampang in the City’s Golden Triangle for RM bid in the government residential land tender for the land
GDP/Capita (US$) $7,468.99 GDP/Capita (US$) $34,346.03
148.2 million made headlines in early 2009. The market parcel at Dakota Crescent for S$329 million (S$509/SF
seems set for a selective play by developers who are plot ratio); Swissotel Merchant Court was sold for S$260
Inflation Rate (%) -0.10% expected to introduce new and modern designed industrial Inflation Rate (%) -0.21%
million to TA Enterprise; Katong Mall is sold for S$247.6
buildings. million bought bu a consortium of investors led by former
Unemployment Unemployment 3.63%
3.60% capital and retail head. ARA purchased Suntec International
Rate (%) Rate (%)
Convention & Exhibition Centre for S$235 million.
Kuala Lumpur At A Glance Singapore At A Glance

Conversion:3.375 RM = 1 US$ RENT/SF/MO US$ RENT/SF/YR Conversion: 1.38 SGD = 1 US$ RENT/SF/YR US$ RENT/SF/YR
DOWNTOWN OFFICE CITY CENTER OFFICE
New Construction (AAA) RM 5.30 RM 6.50 $ 18.84 $ 23.11 N/A New Construction (AAA) SGD 72.00 SGD 120.00 $ 52.17 $ 86.96 20.0%
Class A (Prime) RM 5.50 RM 9.00 $ 19.56 $ 32.00 3.0% Class A (Prime) SGD 72.00 SGD 120.00 $ 52.17 $ 86.96 5.0%
Class B (Secondary) RM 3.50 RM 4.50 $ 12.44 $ 16.00 15.0% Class B (Secondary) SGD 60.00 SGD 90.00 $ 43.48 $ 65.22 10.0%
New Construction (AAA) RM 3.50 RM 4.50 $ 12.44 $ 16.00 N/A New Construction (AAA) SGD 54.00 SGD 72.00 $ 39.13 $ 52.17 20.0%
Class A (Prime) RM 4.00 RM 4.50 $ 14.22 $ 16.00 15.0% Class A (Prime) SGD 54.00 SGD 72.00 $ 39.13 $ 52.17 10.0%
Class B (Secondary) RM 2.50 RM 3.50 $ 8.89 $ 12.44 20.0% Class B (Secondary) SGD 36.00 SGD 54.00 $ 26.09 $ 39.13 15.0%
Bulk Warehouse RM 1.20 RM 1.40 $ 4.27 $ 4.98 N/A Bulk Warehouse N/A N/A N/A N/A N/A
Manufacturing RM 1.50 RM 2.00 $ 5.33 $ 7.11 N/A Manufacturing SGD 14.00 SGD 17.00 $ 10.14 $ 12.32 25.0%
High Tech/R&D RM 2.00 RM 2.50 $ 7.11 $ 8.89 N/A High Tech/R&D SGD 30.00 SGD 33.00 $ 21.74 $ 23.91 15.0%
RETAIL RETAIL
Downtown RM 13.50 RM 14.40 $ 48.00 $ 51.20 10.0% Downtown SGD 264.00 SGD 480.00 $ 191.30 $ 347.83 3.0%
Neighborhood Service Centers RM 7.00 RM 20.00 $ 24.89 $ 71.11 10.0% Neighborhood Service Centers N/A N/A N/A N/A N/A
Community Power Center RM 2.50 RM 12.00 $ 8.89 $ 42.67 15.0% Community Power Center N/A N/A N/A N/A N/A
Regional Malls RM 22.00 RM 28.00 $ 78.22 $ 99.56 5.0% Regional Malls SGD 144.00 SGD 300.00 $ 104.35 $ 217.39 2.0%
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/SF High/SF Low/SF High/SF DEVELOPMENT LAND Low/SF High/SF Low/SF High/SF
Office in CBD RM 1,000.00 RM 1,500.00 $ 296.30 $ 444.44 Office in CBD SGD 800.00 SGD 1,200.00 $ 579.71 $ 869.57
Land in Office Parks RM 200.00 RM 259.00 $ 59.26 $ 76.74 Land in Office Parks SGD 500.00 SGD 800.00 $ 362.32 $ 579.71
Land in Industrial Parks RM 50.00 RM 70.00 $ 14.81 $ 20.74 Land in Industrial Parks SGD 30.00 SGD 100.00 $ 21.74 $ 72.46
Office/Industrial Land - Non-park RM 25.00 RM 35.00 $ 7.41 $ 10.37 Office/Industrial Land - Non-park SGD 20.00 SGD 50.00 $ 14.49 $ 36.23
Retail/Commercial Land RM 300.00 RM 400.00 $ 88.89 $ 118.52 Retail/Commercial Land SGD 1,000.00 SGD 1,500.00 $ 724.64 $1,086.96
Residential (per M2) RM 50.00 RM 70.00 $ 14.81 $ 20.74 Residential SGD 600.00 SGD 2,000.00 $ 434.78 $1,449.28

Seoul, South Korea Taipei, Taiwan
The Korean economy has improved faster than expected. Taipei, the capital of Taiwan, has had the most rapid economic
The global market share of products such as automobile, development in the country and has become a global hub for
semiconductor and cell phones increased and conglomerates the technology industry. Economic growth has reached an
such as Samsung, Hyundai and LG recorded high profits. average of 2.11%. Taipei is the world’s number-one provider
Korea's quarterly GDP growth of 2.3% for the April-to-June of notebook PCs, with 72% of the market share. Taipei is also
period was the highest among members of the OECD. the world’s leading provider of LCD monitors, with 68% of
Overall, Class A office buildings remain stable with low the market share and of chip foundry services, with 70% of
vacancy rates but Class B buildings are experiencing high the market share.
vacancy rates with rents decreased by landlords’ incentives The office inventory in the Taipei metropolitan area totals 7.12
such as longer free rent periods, not seen before in Class B million SM with an average rental rate of NT $599/SM/month,
office buildings. It is expected that the rent of prime buildings and NT $709/SM/month for Class A office space. Vacancy
will decrease in Q4 due to an increase in vacancy rates and rates have risen slightly to 13.92% from 13.80%.
a new supply of office space in the CBD. The dawn is approaching the Taipei office market after the
The investor demand for commercial properties revived from global finance crisis. The success of the Cross-Strait Summit
Q2 was due to the government's drive to prevent a residential has revitalized the real estate market. Several major trans-
Contact real estate bubble from growing larger. The notable transac- Contact actions occurred after Q1 2009, stimulated by the Summit,
tions this year are the ING Tower (KRW 400 billion), DACOM leading to increasing closer economic ties with China. The
NAI Korea NAI Taiwan
(KRW 182 billion), and Pacific Tower (KRW 153 billion). The overall absorption was 28,007 SM in Q3 2009. The demand
+82 2 6205 3500 + 886 2 8770 6699
capitalization rate has seen a slight decrease to 5.5%-6%. in the suburban office market remains steady and the
The industrial market is also suffering from high vacancy absorption rate has continued upward. The overall vacancy
rates of 15%-20% with rent down 20% from the previous rate of Nangang Economy Trading Park Phase III went down
year. Sellers outnumbered buyers in 2009, but transactions 16.34% year over year to 34.81%.
are not active. Ssangyong factory (KRW 95 billion) and The Taipei suburban area saw more major transactions
DAEWOO factory (KRW 100 billion) are among the largest compared to Taipei downtown areas such as Nei-Hu
transactions of the year. Technology Park and Nangang Economy Trading Park. The
In the retail market, the overall rent decreased, except inflow of overseas capital reached to US $12.99 billion
Country Data in Myungdong, the most active retail district in Seoul. Country Data in Q2 2009, the highest ever recorded, according to the
Area (KM2) Myungdong benefited from a new supply of retail space with Area (KM2)
central bank. The increased inflow of foreign capital helped
1334.3 1334.3
Noonsquare (23,869 SM) and from tourists visiting the area. both the local financial and real estate markets in Q3 2009.
GDP Growth (%) -0.99% The opening of Times Square shopping mall (370,000 SM) GDP Growth (%) -4.13% The agreements on Financial MOU and ECFA between
in Youndeungpo, is drawing attention to the district. Taiwan and China encouraged Taiwanese corporations in
GDP 2009 (US$ B) $800.29 A large scale urban redevelopment is under way in the CBD, GDP 2009 (US$ B) $357.34 China to reinvest back in Taiwan and also allowed for certain
and a new supply of large office buildings and a high-rise forms of Chinese investments in companies on the island.
GDP/Capita (US$) $16,449.90 residential complex are expected in two to three years. GDP/Capita (US$) $15,373.34
Inflation Rate (%) 2.6% Inflation Rate (%) -0.5%

Rate (%) Rate (%)
Seoul At A Glance Taipei At A Glance

Conversion: 1179.20 KRW = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion: 32.3 TWD = 1 US$ RENT/M2/MO US$ RENT/SF/YR
CITY CENTER OFFICE CITY CENTER OFFICE
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) TWD 756.00 TWD 1,059.00 $ 26.09 $ 36.55 45.2%
Class A (Prime) KRW 290,400 KRW 435,600 $ 22.88 $ 34.32 3.0% Class A (Prime) TWD 711.00 TWD 998.00 $ 24.54 $ 34.45 14.0%
Class B (Secondary) KRW 200,400 KRW 290,400 $ 15.79 $ 22.88 4.2% Class B (Secondary) TWD 499.00 TWD 635.00 $ 17.22 $ 21.92 13.9%
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) TWD 393.00 TWD 484.00 $ 13.56 $ 16.71 61.0%
Class A (Prime) KRW 144,000 KRW 217,800 $ 11.34 $ 17.16 4.5% Class A (Prime) TWD 303.00 TWD 454.00 $ 10.46 $ 15.67 15.9%
Class B (Secondary) KRW 108,900 KRW 127,200 $ 8.58 $ 10.02 N/A Class B (Secondary) TWD 257.00 TWD 378.00 $ 8.87 $ 13.05 22.5%
Bulk Warehouse KRW 54,480 KRW 72,600 $ 4.29 $ 5.72 15.0% Bulk Warehouse TWD 151.00 TWD 212.00 $ 5.21 $ 7.32 16.8%
Manufacturing N/A N/A N/A N/A N/A Manufacturing TWD 136.00 TWD 197.00 $ 4.69 $ 6.80 13.4%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D TWD 330.00 TWD 378.00 $ 11.39 $ 13.05 19.0%
RETAIL RETAIL
Downtown KRW 4,800,000 KRW 500,000 $ 37.82 $ 39.39 N/A Downtown TWD 3,781.00 TWD 6,723.00 $ 130.50 $ 232.04 1.0%
Neighborhood Service Centers KRW 156,000 KRW 300,000 $ 12.29 $ 23.64 N/A Neighborhood Service Centers TWD 968.00 TWD 1,966.00 $ 33.41 $ 67.86 5.9%
Community Power Center N/A N/A N/A N/A N/A Community Power Center TWD 378.00 TWD 678.00 $ 13.05 $ 23.40 1.9%
Regional Malls N/A N/A N/A N/A N/A Regional Malls TWD 1,573.00 TWD 3,267.00 $ 54.29 $ 112.76 2.4%
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/M2 High/M2 DEVELOPMENT LAND Low/M2 High/M2 Low/Acre High/Acre

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
36
Calgary, Alberta, Canada Edmonton, Alberta, Canada
The global economic downturn continued to have a negative Edmonton and Northern Alberta weathered the economic
impact on the city of Calgary due to the influence the oil and storm longer than most markets throughout Canada. Of
gas industry has on our market. On top of that, the over built a provincial total of $240 billion in major projects proposed,
downtown office boom in Calgary has led to vacancy that currently under construction or recently completed, $189
exceeds anything that we have experienced in the past. billion are slated for Northern Alberta. Oil and gas
Downtown office leasing continues to be the major story in projects make up 52.19% of this total. Throughout 2009, the
real estate in Calgary. There is currently over 1.8 million SF investment market has seen a tightening of available credit
of vacant sublease space and 1.3 million SF of head lease and the creation of a vast disconnect between seller’s
vacancy in the downtown core, with another 3.5 million SF of expectations and buyer’s opinions of value.
new space coming to the market in 2010. Companies are Even while the economy appears to be improving, credit and
continuing to reduce space in order to cut costs. If the current lending parameters remain tight from the effect of the
economic conditions continue, there is a potential for these sub-prime correction. Given these conditions, many owners
vacancy numbers to double by 2012. remain in a holding position and investment volumes are
On the positive side, the industrial and retail markets have down.
remained relatively stable because they were not overbuilt. With a total office inventory of 24,155,355 SF, vacancies
Contact The industrial developers adapted quickly to the recession Contact increased to 6.45% in 2009 up from 4.01% in 2008. Office
and as a result, inventory growth was very low in 2009. There rents from the peak in 2008 have been in decline. The
NAI Commercial Calgary NAI Commercial Edmonton
was continued strength in the sale of freestanding buildings 28-story, 618,000 SF Epcor Tower, still under construction,
+1 403 214 2344 +1 780 436 7410
in 2009 as prices saw a slight decrease and interest rates is now 70% committed. Redevelopment of the former
remained low. Professional Building (240,000 SF) continues and the
The investment market had reduced activity due to a shortage province has also announced a $356 million upgrade of the
of top-quality, wel-priced products being offered for sale, Federal Building which has been vacant since 1989.
which was not related to the weak economic conditions. All Edmonton’s retail inventory is reported at 25,438,598 SF
segments of the investment market are starting to show signs with a vacancy rate of 2.96% in 2009, down from 3.11% in
of new life. It is anticipated that positive recovery of this 2008. Despite challenging economic times, this segment
segment will continue over the next 12 to 18 months. remains strong with the expansion of existing players and
Country Data Although the downtown office leasing market is looking Country Data the introduction of new entrants to the market.
bleak, investors still view Calgary as a relatively strong The total inventory of industrial space grew by 6.7% to
Area 9,200,000 investment market. A prime example is the recent purchase Area 9,200,000 88,289,785 SF in 2009. The overall vacancy in 2009 was
of a new $74 million office development, Stampede Station 1.92% compared to 1.30% in 2008. Despite such a low
GDP Growth (%) -2.48% Phase One, by German Investors. GDP Growth (%) -2.48% vacancy rate, industrial activity has been down with the
largest vacancy increases being seen in the multi-bay
GDP 2008 (US$ B) $1,319.14 GDP 2008 (US$ B) $1,319.14
market. Given the economic news throughout 2009, tenants’
expectations were that rents should be significantly reduced.
GDP/Capita (USD) $39,217.29 GDP/Capita (USD) $39,217.29 Throughout the latter half of 2009, asking rents in varying
areas have moderated by about 10% with landlords offering
Inflation Rate (%) 0.15% Inflation Rate (%) 0.15% leasehold inducements in order to compete for lease deals.

Rate (%) Rate (%)
Interest Rate (%) 0.25% Interest Rate (%) 0.25%
Calgary At A Glance Edmonton At A Glance

Conversion .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR Conversion .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR
New Construction (AAA) CDN 32.00 CDN 42.00 $ 33.33 $ 43.75 7.8% New Construction (AAA) CDN 28.00 CDN 35.00 $ 29.17 $ 36.46 N/A
Class A (Prime) CDN 24.00 CDN 28.00 $ 25.00 $ 29.17 9.2% Class A (Prime) CDN 25.00 CDN 32.00 $ 26.04 $ 33.33 6.5%
Class B (Secondary) CDN 14.00 CDN 24.00 $ 14.58 $ 25.00 13.7% Class B (Secondary) CDN 15.00 CDN 25.00 $ 15.63 $ 26.04 6.5%
New Construction (AAA) CDN 23.00 CDN 28.00 $ 23.96 $ 29.17 6.3% New Construction (AAA) CDN 23.00 CDN 28.00 $ 23.96 $ 29.17 6.5%
Bulk Warehouse CDN 4.75 CDN 7.00 $ 4.95 $ 7.29 5.7% Bulk Warehouse CDN 5.00 CDN 11.50 $ 5.21 $ 11.98 1.9%
Manufacturing CDN 5.00 CDN 8.50 $ 5.21 $ 8.85 4.0% Manufacturing CDN 5.00 CDN 13.00 $ 5.21 $ 13.54 1.9%
High Tech/R&D CDN 7.50 CDN 14.00 $ 7.81 $ 14.58 2.4% High Tech/R&D CDN 5.00 CDN 13.00 $ 5.21 $ 13.54 1.9%
RETAIL RETAIL
Downtown CDN 25.00 CDN 95.00 $ 26.04 $ 98.96 3.1% Downtown CDN 18.00 CDN 37.00 $ 18.75 $ 38.54 4.6%
Neighborhood Service Centers CDN 23.00 CDN 30.00 $ 23.96 $ 31.25 3.5% Neighborhood Service Centers CDN 16.00 CDN 32.00 $ 16.67 $ 33.33 2.8%
Community Power Center CDN 26.00 CDN 35.00 $ 27.08 $ 36.46 2.1% Community Power Center CDN 24.00 CDN 35.00 $ 25.00 $ 36.46 2.6%
Regional Malls CDN 60.00 CDN 150.00 $ 62.50 $ 156.25 3.1% Regional Malls CDN 30.00 CDN 125.00 $ 31.25 $ 130.21 3.4%
DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre
Office in CBD CDN 35.00 CDN 250.00 $ 36.46 $ 260.42 Office in CBD N/A N/A N/A N/A
Land in Office Parks CDN 400,000 CDN 1,000,000 $ 416,666.67 $1,041,666.67 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks CDN 400,000 CDN 600,000 $ 416,666.67 $ 625,000.00 Land in Industrial Parks CDN 200,000 CDN 650,000 $ 208,333.33 $ 677,083.33
Office/Industrial Land - Non-park CDN 350,000 CDN 800,000 $ 364,583.33 $ 833,333.33 Office/Industrial Land - Non-park CDN 300,000 CDN 750,000 $ 312,500.00 $ 781,250.00
Retail/Commercial Land CDN 600,000 CDN 1,600,000 $ 625,000.00 $1,666,666.67 Retail/Commercial Land CDN 350,000 CDN 1,000,000 $ 364,583.33 $1,041,666.67
Residential Residential CDN 85,000 CDN 1,000,000 $ 88,541.67 $1,041,666.67
CDN 50,000 CDN 600,000 $ 52,083.33 $ 625,000.00

Vancouver, British Columbia, Canada Victoria, British Columbia, Canada
Vancouver is the largest city in British Columbia and the third Victoria, British Columbia, is the capital city of the Province
largest in Canada. Metropolitan Vancouver is home to of British Columbia, which employs some 10,000 people in
2.4 million people and is one of the largest ports on North the downtown area. It has five primary economic drivers that
America’s west coast. Vancouver is set to host the 2010 include the provincial government, the University of Victoria,
Winter Olympics and expects 2.5% growth in the regional high technology, tourism and the Department of National
economy for 2010. Defense, which operates Canada’s largest naval base on
Overall the region has fared better than most during 2009. the Pacific Coast.
The office market in the CBD has an overall vacancy rate Since the fall of 2008, the provincial government has seen
of 7.0%, and absorption is expected to be negative until a decline in revenue resulting in spending cuts. Tourism has
mid-2010. In recent years, demand for high-rise residential been damaged by a drop in both US and international
development sites in the urban core has led to reduced visitors. A relatively healthy local economy and low interest
office space inventory with little new office product coming rates have resulted in a robust housing market that has seen
to market in 2010-2011. The office markets in Richmond, increases in sales volumes and strengthening of prices. The
Burnaby and Surrey have rebounded as tenants look to the median single family house price is $500,000.
suburbs for space. The industrial market is challenging for buyers and tenants
Contact The industrial market continues to outperform most other Contact with a very low vacancy rate of less than 1% and limited
Canadian industrial markets due to insufficient supply, with new supply. Rents for industrial space have remained stable.
NAI Commercial NAI Commercial Victoria
average vacancy rates of approximately 4%. Land prices Lack of capacity in existing industrial areas in the Victoria
Vancouver +1 250 381 2265
are expected to be stable in 2010, ranging between area continues to be a problem.
+1 604 691 6643
C $750,000 and C $1.3 million/acre. Overall absorption The office market has seen an increase in vacancy rates. A
remains positive. Rental rates average C $8.00/SF net. The notable impact on the downtown office market has been the
retail market is under increasing pressure due to slowing downsizing of the provincial government as it struggles with
consumer spending. Steady population growth especially in its budget deficit. A new mall under construction anchored
the CBD and near the rapid transit lines will keep this sector by Wal-Mart includes an office component of 200,000 SF of
active in 2010. Market rents will remain fairly stable as well. space. It will be interesting to see how readily the market
The investment market is recovering slowly. After five quarters absorbs this new product in the current economic environment.
Country Data of either flat or declining levels of investment activity, the Country Data The retail market in the downtown core continues to show
Greater Vancouver property market showed signs of recovery weakness due to a diminished tourism sector. The 8%
in Q3 2009. vacancy rate is expected to hold. Regional and community
Area 9,200,000 Area 9,200,000
The multifamily market is particularly active with cap rates retail centers in Victoria have a 2-3% vacancy rate with
GDP Growth (%) -2.48% of approximately 5.0%. Cap rates for most other product GDP Growth (%) -2.48% lease rates stable.
types range between 6.5% and 8.0% in the Vancouver re- Investment sales continue to be limited by a lack of product.
GDP 2008 (US$ B) $1,319.14
gion and between 8.0% and 10% in secondary markets out- GDP 2008 (US$ B) $1,319.14 An abundance of qualified purchasers and the limited number
side the Vancouver area depending on product type and of investment properties have resulted in capitalization rates
location. remaining resilient to the recessionary pressures. Prime com-
GDP/Capita (USD) $39,217.29 GDP/Capita (USD) $39,217.29
mercial property capitalization rates are 6-7%. Residential
Inflation Rate (%) 0.15% Inflation Rate (%) 0.15% apartment capitalization rates are around 5%.

Rate (%) Rate (%)
Vancouver At A Glance Victoria At A Glance

Conversion .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR Conversion .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR
RETAIL RETAIL
Downtown CDN 105.00 CDN 180.00 $109.38 $187.50 4.0% Downtown CDN 38.00 CDN 90.00 $ 39.58 $ 93.75 9.0%
Neighborhood Service Centers CDN 30.00 CDN 60.00 $ 31.25 $ 62.50 4.0% Neighborhood Service Centers CDN 26.00 CDN 32.00 $ 27.08 $ 33.33 5.0%
Community Power Center CDN 30.00 CDN 40.00 $ 31.25 $ 41.67 4.5% Community Power Center CDN 24.00 CDN 28.00 $ 25.00 $ 29.17 2.0%
Regional Malls CDN 25.00 CDN 40.00 $ 26.04 $ 41.67 4.5% Regional Malls CDN 50.00 CDN 70.00 $ 52.08 $ 72.92 3.0%
DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre
Office in CBD CDN 75.00 CDN 135.00 $ 78.13 $ 140.63 Office in CBD CDN 1,500,000 CDN 2,000,000 $1,562,500.00 $ 2,083,333.33
Land in Office Parks CDN 900,000 CDN 1,300,000 $ 937,500.00 $ 1,354,166.67 Land in Office Parks CDN 600,000 CDN 1,000,000 $ 625,000.00 $ 1,041,666.67
Land in Industrial Parks CDN 850,000 CDN 1,300,000 $ 885,416.67 $ 1,354,166.67 Land in Industrial Parks CDN 500,000 CDN 750,000 $ 520,833.33 $ 781,250.00
Office/Industrial Land - Non-park CDN 750,000 CDN 1,200,000 $ 781,250.00 $ 1,250,000.00 Office/Industrial Land - Non-park CDN 600,000 CDN 900,000 $ 625,000.00 $ 937,500.00
Retail/Commercial Land CDN 750,000 CDN 1,500,000 $ 781,250.00 $ 1,562,500.00 Retail/Commercial Land CDN 1,000,000 CDN 1,500,000 $1,041,666.67 $ 1,562,500.00
Residential CDN 750,000 CDN 1,500,000 $ 781,250.00 $ 1,562,500.00 Residential CDN 400,000 CDN 1,000,000 $ 416,666.67 $ 1,041,666.67

Halifax, Nova Scotia, Canada Ottawa, Ontario, Canada
Halifax Regional Municipality (HRM) is the economic hub of The Ottawa Federal Government has been hiring steadily, with
Atlantic Canada and appears to have weathered the current an expectation that hiring will be reevaluated based on the
global financial crisis better than other parts of the country. economic setback of 2009. The high-tech sector continues to
Perhaps this is because HRM has the Canadian Navy’s East strengthen; sector employment numbers are now exceeding
Coast base, is the location of many federal government the exaggerated pre-high tech bust of 2000. Although the
offices and six universities, and as a result is home to a large public sector and high-tech sectors are still growing soundly,
concentration of educational, medical and research facilities. this growth is being offset by downturns in other sectors
affected by the global recession. Employment is expected
The vacancy rate for all classes of office buildings is up this to remain stable.
year to 7.44%, an overall increase of 1.2%. The current
vacancy rate for Class A space is 4.97%, Class B 8.38% Growth in the local economy is expected to decline 0.5%
and Class C 7.17%. Although several projects have been this year before rebounding 3.1% in 2010. The industrial
market performed well with inventory exceeding 22 million
approved for the CBD, rental rates need to be at least
SF. The overall vacancy rate, excluding Kanata, dropped to
$25/SF net to make construction worthwhile. Class A rents
below 3.9%. With limited new construction, 2010 vacancy
currently are at $18/SF. However, office development should decline further and rental rates are expected to
continues in the suburban market where land is cheaper. increase. Larger industrial building space blocks are limited,
Construction has recently commenced on a 15-acre site rental rates have increased and demand is strong for high-
Contact known as The Wright and Burnside Business Campus. It will Contact
quality high-ceiling modern industrial space.
NAI Turner Drake include six office buildings totaling 400,000 SF. NAI Commercial Ottawa
& Partners Ltd. +1 613 230 2100 Office market inventory exceeds 47 million SF, with over 2.5
Warehouse vacancy is up in HRM to 8.14% overall and net million SF of vacant space; over half of this vacancy is in
+1 902 429 1811
rental rates have remained virtually unchanged from last Kanata (western suburban market). Vacancy rates elsewhere
year. Burnside/City of The Lakes is the largest of HRM’s are in decline. Expectations in Kanata indicate a softening of
industrial parks and has a 4.91% vacancy. There are several the market with multiple companies, including Nortel’s
new buildings under construction for owner/occupiers in demise, offering space in the sublet market. In Ottawa core,
this Park. a new 370,000 SF building was constructed by Ottawa
On the retail front, Dartmouth Crossing continues to expand developer Minto Group. The building is over 70% occupied
with the remainder expected to be occupied by the Federal
its retail park. Costco recently opened its second HRM
government. Export Development Corporation will relocate
Country Data location here and Hampton Inn and Suites welcomed its first Country Data with a new high-rise tower of 535,000 SF under construction
guests earlier this year. Bedford Commons, also known as by Broccolini in the core.
NorthGate Power Centre, a retail project, is under construction. Area 9,200,000
Area 9,200,000 The local retail market sustained a vacancy rate of 2.7%
Wal-Mart, Canadian Tire, Future Shop and other national
retailers are due to occupy space in this development. There with an increase of 0.03% in the previous six months.
GDP Growth (%) -2.48%
is a shortage of available investment product and the market GDP Growth (%) -2.48% Effects of the unanticipated Canadian dollar strengthening,
has been slow. and concerns over economic downturn, will not be reflected
GDP 2008 (US$ B) $1,319.14 GDP 2008 (US$ B) $1,319.14 in this sector. Vacancy rental rates continued to escalate
Council passed “HRM By Design” a blueprint for the future with rates averaging $19.75 SF. New retail construction has
of Downtown Halifax. The plan is a balance between heritage GDP/Capita (USD) $39,217.29 adopted a “wait and see” approach. There continues to be
GDP/Capita (USD) $39,217.29
preservation and growth. Plans were unveiled recently for a development of small neighborhood infill projects serving
new Trade and Convention Centre in the Halifax downtown. the rapidly growing suburbs.
Also in the works is a new commercial/residential subdivi- Long-term investors are keeping a large percentage of cap-
sion in Bedford West. ital on the sidelines. Substantial assets offered for sale are
Rate (%) Rate (%) beginning to receive attention. Capitalization rates increased
slightly. Offshore and international investors have expressed
0.25% 0.25%
continued interest in low-risk products. It has yet to be seen
Interest Rate (%) Interest Rate (%)
if the extraordinary difficulty experienced in the capital mar-
kets will alter commercial real estate markets in dramatic,
Population (Millions) 33.637 Population (Millions) 33.637 unforeseen ways.
Halifax At A Glance Ottawa At A Glance

Conversion: .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR Conversion: 94 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR
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) CDN 26.50 CDN 26.50 $ 27.60 $ 27.60 32.0% New Construction (AAA) N/A N/A N/A N/A N/A
RETAIL RETAIL
Downtown CDN 35.00 CDN 65.00 $ 36.46 $ 67.71 N/A Downtown CDN 50.00 CDN 195.00 $ 53.19 $ 207.45 4.9%
Neighborhood Service Centers CDN 22.00 CDN 28.00 $ 22.92 $ 29.17 N/A Neighborhood Service Centers CDN 20.00 CDN 35.00 $ 21.28 $ 37.23 4.3%
Community Power Center CDN 28.00 CDN 31.00 $ 29.17 $ 32.29 N/A Community Power Center CDN 35.00 CDN 65.00 $ 37.23 $ 69.15 1.2%
Regional Malls CDN 65.00 CDN 75.00 $ 67.71 $ 78.13 N/A Regional Malls CDN 30.00 CDN 68.00 $ 37.23 $ 69.15 1.0%
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre
Office in CBD N/A N/A N/A N/A Office in CBD CDN 17,000,000 CDN 17,000,000 $ 18,085,106.38 $ 18,085,106.38
Land in Office Parks CDN 239,580 CDN 326,700 $ 249,562.50 $ 340,312.50 Land in Office Parks CDN 350,000 CDN 400,000 $ 372,340.43 $ 425,531.91
Land in Industrial Parks CDN 163,350 CDN 239,580 $ 170,156.25 $ 249,562.50 Land in Industrial Parks CDN 275,000 CDN 375,000 $ 292,553.19 $ 398,936.17
Office/Industrial Land - Non-park CDN 270,115 CDN 521,413 $ 281,369.79 $ 543,138.54 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land CDN 270,115 CDN 544,500 $ 281,369.79 $ 567,187.50 Retail/Commercial Land CDN 350,000 CDN 2,000,000 $ 372,340.43 $ 2,127,659.57
Residential CDN 206,358 CDN 317,117 $ 214,956.25 $ 330,330.21 Residential CDN 375,000 CDN 3,000,000 $ 372,340.43 $ 2,127,659.57

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. With a population of approximately is a genuine international business center, one that forms a
5.5 million people, Toronto is home to one-sixth of Canada’s bridge between the economy of the European Union and
workforce. As Canada’s center for commerce, Toronto is that of the US. Montreal has not suffered excessively from
the hub of the banking and investment community and the worldwide recession that dominated the market in 2009.
also acts as the gateway for other major industries in Classed among the 20 largest cities in North America, it
Canada including, medical, film, tourism, fashion, food and appears that Montreal is a city that has been able to weather
information technology. the crisis without incurring too much damage.
Toronto’s downtown office market fundamentals continue The city of Montreal is ranked second in North America with
to reflect the current economic condition with the availability respect to jobs related to the design and production of video
rate remaining at approximately 10%, up from 6.9% in games. The city is also a major center for corporations
2008. Of note, the downtown financial core will see a operating in the aerospace, pharmaceutical and biotechnology
dramatic increase in inventory with the addition of just over fields, and a leader in electronic commerce, multimedia
3 million SF expected to come online by the end of 2009. production and information technology. The film industry
These new completions, which include the Bay Adelaide also continues to experience interesting growth in Montreal.
Centre, Maple Leaf Square, RBC Centre and the Telus Tower, The market for office space in the greater Montreal area
Contact will consist primarily of tenants who have relocated from Contact
represents more than 21% of the entire Canadian market.
NAI Ashlar Urban within the downtown core. NAI Commercial
The total inventory in this market is more than 72 million
+1 416 205 9222 Montreal
With the availability of new back-fill space, we expect an SF, 60% of which is in the downtown core. The overall office
+1 514 866 3333
increase in the vacancy rate in the downtown financial core. vacancy rate is 8%. No large projects have been started
Not withstanding the softening of net rents in the financial during this period, but in both Laval and the South Shore,
core, the downtown east and west markets have fared com- situated adjacent to Montreal, several building projects have
paratively well as lower occupancy costs and strong demand been developed.
have helped keep vacancy rates stable. The hotel sector in Montreal continues to develop, with
Toronto has remained very forward thinking in terms of its several new projects under way. There is approximately
environmental standards. All major new developments sched- 326.5 million SF of leasable industrial space in the greater
Country Data uled for the next 24 months have been registered for LEED Country Data Montreal area. The vacancy rate in the industrial sector is
certification, and smaller developments are starting to bring 7%. The majority of unoccupied space is found in older
a new generation of “green buildings” to the market. New Area 9,200,000
buildings with lower headroom, with more recent buildings
Area 9,200,000
energy alternatives such as deep lake water cooling, have offering greater headroom. However, industrial development
been embraced by some of the major new developments has been on the slow side, keeping demand steady with the
GDP Growth (%) -2.48% GDP Growth (%) -2.48%
(Telus Tower and RBC Centre) in Toronto. A chief objective of expectation of an improvement in the world economy in 2010.
the city of Toronto is to have 80% of the downtown area Montreal has made its mark this year by implementing its
GDP 2009 (US$ B) $1,319.14 GDP 2009 (US$ B) $1,319.14
serviced by Enwave by 2050. 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.

Rate (%) Rate (%)
Toronto At A Glance Montreal At A Glance

Conversion: .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR Conversion: .96 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR
New Construction (AAA) CDN 28.00 CDN 40.00 $ 29.17 $ 41.67 9.7% New Construction (AAA) CDN 28.50 CDN 55.00 $ 29.69 $ 57.29 6.8%
New Construction (AAA) CDN 12.00 CDN 16.00 $ 12.50 $ 16.67 9.0% New Construction (AAA) N/A N/A N/A N/A 11.0%
Class A (Prime) N/A N/A N/A N/A N/A Class A (Prime) CDN 25.00 CDN 31.00 $ 26.04 $ 32.29 11.5%
Class B (Secondary) N/A N/A N/A N/A N/A Class B (Secondary) CDN 15.00 CDN 20.00 $ 15.63 $ 20.83 N/A
Manufacturing N/A N/A N/A N/A N/A Manufacturing CDN 4.25 CDN 6.00 $ 4.43 $ 6.25 6.5%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D CDN 5.75 CDN 7.25 $ 5.99 $ 7.55 7.0%
RETAIL RETAIL
Downtown CDN 30.00 CDN 130.00 $ 31.25 $ 135.42 10.0% Downtown CDN 45.00 CDN 200.00 $ 46.88 $ 208.33 5.0%
Neighborhood Service Centers N/A N/A N/A N/A N/A Neighborhood Service Centers CDN 13.00 CDN 25.00 $ 13.54 $ 26.04 6.5%
Community Power Center N/A N/A N/A N/A N/A Community Power Center CDN 22.00 CDN 32.00 $ 22.92 $ 33.33 3.5%
Regional Malls N/A N/A N/A N/A N/A Regional Malls CDN 30.00 CDN 55.00 $ 31.25 $ 57.29 6.0%
Office in CBD N/A N/A N/A N/A Office in CBD CDN 6.50 CDN 15.00 $ 6.77 $ 15.63
Land in Office Parks N/A N/A N/A N/A Land in Office Parks CDN 5.50 CDN 15.00 $ 5.73 $ 15.63
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks CDN 4.50 CDN 14.00 $ 4.69 $ 14.58
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park CDN 4.50 CDN 15.00 $ 4.69 $ 15.63
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land CDN 8.00 CDN 15.00 $ 8.33 $ 15.63
Residential N/A N/A N/A N/A Residential CDN 6.00 CDN 28.00 $ 6.25 $ 29.17

Regina, Saskatchewan, Canada
The Saskatchewan market appears to be an "oasis" amid a
general economic downturn. After years of being a "have not"
province it is apparent that it is Saskatchewan's time in the
sun. Saskatchewan has abundant resources and a strong
economy. Agriculture, oil, gas, potash, uranium, diamonds,
gold, and coal have diversified the economy. Unemployment
is below 5% and is predicted to remain steady. The two
largest cities, Regina and Saskatoon, with a combined
population of 500,000, enjoy a diversified economy.
After 10 years of expansion on the east side of Regina, and
five years’ growth in the northwest, look for the focus in the
retail market to shift to Harbour Landing (800,000 SF)
in the southwest corner of Regina. Rental rates for all other
areas are expected to remain constant in 2010. The
Saskatchewan investment market remains strong. While
investor appetite globally has waned, the local Saskatchewan
Contact market has investor appeal. Capitalization rates range
NAI Commercial between 8% -9% for well-located, well-tenanted projects.
(SASK)
The vacancy factor for industrial space is at an all time low.
+1 306 525 3344
Lack of construction and low supply will invariably continue
to push rental rates up. Industrial rates are in the range of
US $8.00-$9.00 for existing projects and US $13.00-
$15.00 for new construction. Land remains in good supply
at US $225,000-$250,000/acre.
The Regina office market witnessed a reduction of net
absorption to 80,000 SF in early 2009. Vacancy is at an
Country Data overall rate of 1.73%. Lease rates will continue upward as
we emerge from the recession. Pent up demand before the
recession will remain and no new projects are expected for
Area 9,200,000
2010. Interest in agricultural land in Saskatchewan has risen
steadily for the past three years. Rising commodity prices
GDP Growth (%) -2.48% have led to increased demand for rural land. Values are
expected to improve in 2010.
GDP 2008 (US$ B) $1,319.14
To summarize, the Saskatchewan market remains strong
and is predicted to experience continued steady growth into
2010. Look for rates in all sectors to continue upward as
steady demand, low vacancy rates, and a lack of new
Inflation Rate (%) 0.15% product will naturally force rates upward.
Unemployment 8.33%
Rate (%)
Interest Rate (%) 0.25%
Regina At A Glance
Conversion .97 CDN = 1 US$ NET RENT/SF/YR US$ NET RENT/SF/YR
Low High Low High Vacancy
DOWNTOWN OFFICE
New Construction (AAA) CDN $ 35.00 CDN $ 40.00 $ 3.35 $ 3.83 N/A
Class A (Prime) CDN $ 18.00 CDN $ 22.00 $ 1.72 $ 2.11 N/A
Class B (Secondary) CDN $ 12.00 CDN $ 14.00 $ 1.15 $ 1.34 N/A
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 CDN$ 6.00 CDN $ 8.00 $ 0.57 $ 0.77 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 CDN $ 20.00 CDN $ 25.00 $ 1.92 $ 2.39 N/A
Neighborhood Service Centers CDN $ 12.00 CDN $ 15.00 $ 1.15 $ 1.44 N/A
Community Power Center N/A N/A N/A N/A N/A
Regional Malls CDN $ 35.00 CDN $ 50.00 $ 3.35 $ 4.79 N/A
DEVELOPMENT LAND Low//Acre High/Acre Low/Acre High/Acre
Office in CBD CDN $ 50.00 CDN $ 75.00 $ 51.55 $ 77.32
Land in Industrial Parks CDN $ 4.00 CDN $ 6.00 $ 4.12 $ 6.19
Retail/Commercial Land CDN $ 12.00 CDN $ 25.00 $ 12.37 $ 25.77
Residential N/A N/A N/A N/A
41 2010 Global Market Report I www.naiglobal.com 41

EMEA
SECTION CONTENTS
Vienna, Austria
The Baltics (Latvia/Estonia/Lithuania)
Sofia, Bulgaria
Prague, Czech Republic
Copenhagen, Denmark
Finland
Paris - Ile de France (Paris Region), France
Frankfurt am Main, Germany
Athens Greece
Iceland
Tel Aviv, Israel
Almaty, Kazakhstan
Kuwait
Oslo, Norway
Doha City, Qatar
Bucharest, Romania
Moscow, Russian Federation
St. Petersburg, Russian Federation
Belgrade, Serbia
Johannesburg, South Africa
Madrid, Spain
Stockholm, Sweden
Geneva, Switzerland
Zurich, Switzerland
Kiev, Ukraine
Istanbul, Turkey
London, England, United Kingdom
42 42
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 has historically been a focus for commerce growing economies in Europe. However, the unbalanced
between East and the West. Growth in the Austrian economy growth from 2005 through 2008, influenced by rapidly
is estimated at -3.4% for 2009 with inflation at 0.5%. The growing domestic demand and availability of advantageous
unemployment rate was 4.4% in July 2009, compared to credit resources, is the primary cause for the current crisis
9% for the EU 27. in the three Baltic countries. The economic activities
The new supply of office space was approximately 240,000 decreased most significantly in trade, manufacturing and
SM in 2008. For 2009 about 220,000 SM are estimated. construction sectors. With the decline of domestic demand,
Demand in the office space rental market has slackened. the consumer price inflation has been gradually decreasing.
Nevertheless, with approximately 280,000 SM of activity, The office market faces a severe slowdown due to lack of
the leasing performance will level off at a respectable value financing and a decrease in demand. Vacancy rates
due to numerous relocations and location consolidations. continue to rise. Vacancy in Class A offices is about 10% on
Annual leasing activity totaled approximately 340,000 average and 10.5% to 27% in Class B offices. Landlords
SM during the record years of 2005-2008. are offering attractive incentives and discounted rentals.
In recent months, increased space demand has come from Compared to 2008, the average rental decrease was 25%
the trade, financial and leisure sectors. Top rents as well as for Class B and 15% for Class A offices.
Contact Contact
the average rent are stable at €24.00, respectively Over the last few years more than 15 shopping centers
NAI Otto Immobilien NAI Baltics
€12.10/SM/month. The vacancy rate remains at 5.7%. opened or were significantly expanded in the Baltic States.
+43 1 512 77 77 +371 6731 2396
Demand for industrial and warehousing facilities has weak- However, the large scale retail developments have been
ened significantly. Rents have softened to around temporarily postponed. The retail space market has changed
€5.00/SM/month. Owner-occupation is still a dominant from a landlords’ market to a tenants’ market, and many
feature of the market. Retail sales in Austria continued to international companies have chosen to enter the Baltic
be strong during the first six months of 2009. Prime rents States retail market under the new preferential conditions.
for unit shops achieve approximately €2,400/SM/year. One major advantage of the three Baltic countries is strategic
Within the framework of Vienna’s main railway stations a lot location at the crossroads between Eastern and Western
of retail space is going to enter the market during Europe, hence new entrant international companies are
the next few years. Investment market demand, as well as seeing the benefits of setting up manufacturing or logistics
Country Data the requirements concerning property quality and yields, Country Data
activities in the Baltic States. Due to current economic
have risen (as much as 1% beyond the top segment). Pricing conditions, rental rates for industrial/warehouse facilities
Area (KM2) 1334.3 continues to be difficult for both sides. The massive Area (KM2) 175015
have shown instability and a major decrease.
purchase price reductions some expected have not materi-
GDP Growth (%) -3.82% alized due to market participants’ wait and see stance. GDP Growth (%) 15.5% Investment volumes were diminished in 2009, mostly due to
limitations on real estate financing imposed by the Scandi-
In recent months, the commercial properties changing navian banks, which play a leading role in the Baltics, as
GDP 2009 (US$ B) $374.42 GDP 2009 (US$ B) $83.70
ownership have been mostly special-use properties like well as the influence of the sub-prime mortgage crisis on the
garages and supermarkets, rather than typical offices. European markets.
GDP/Capita (US$) $45,090.49 Nowadays a trend to less risky real estate investments is GDP/Capita (US$) $11,900
clearly noticeable on the demand side. Experiencing a current downturn, the Baltic real estate
Inflation Rate (%) 0.47% Inflation Rate (%) 2.5% market provides excellent possibilities to attain high returns
and future prospects of capital appreciation when the
Unemployment 5.27% Unemployment 14.7% market stabilizes. The Baltic States will remain an interesting
Rate (%) Rate (%) arena for investors and professional developers due to its
Interest Rate(%) 1.00% Interest Rate(%) 7.5% excellent strategic location between Eastern and Western
Europe.
Vienna At A Glance The Baltics At A Glance

Conversion: 0.70 € = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion: 0.6664 Euro = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) € 156.00 € 288.00 $ 20.70 $ 38.22 5.7% New Construction (AAA) € 108.00 € 144.00 $ 15.06 $ 20.07 15.0%
Class A (Prime) € 156.00 € 288.00 $ 20.70 $ 38.22 5.7% Class A (Prime) € 120.00 € 180.00 $ 16.73 $ 25.09 10.5%
Class B (Secondary) € 131.00 € 156.00 $ 17.39 $ 20.70 5.7% Class B (Secondary) € 84.00 € 108.00 $ 11.71 $ 15.06 18.0%
New Construction (AAA) € 140.00 € 156.00 $ 18.58 $ 20.70 5.7% New Construction (AAA) € 84.00 € 120.00 $ 11.71 $ 16.73 25.0%
Class A (Prime) € 131.00 € 156.00 $ 17.39 $ 20.70 5.7% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) € 90.00 € 140.00 $ 11.94 $ 18.58 5.7% Class B (Secondary) € 60.00 € 84.00 $ 8.36 $ 11.71 27.0%
Bulk Warehouse € 30.00 € 60.00 $ 3.98 $ 7.96 9.0% Bulk Warehouse € 42.00 € 72.00 $ 5.86 $ 10.04 20.0%
Manufacturing € 50.00 € 70.00 $ 6.64 $ 9.29 9.0% Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D € 60.00 € 78.00 $ 7.96 $ 10.35 8.0% High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center € 872.00 € 2,400.00 $115.73 $ 318.52 7.5% City Center € 216.00 € 540.00 $ 30.11 $ 75.28 3.0%
Neighborhood Service Centers € 260.00 € 430.00 $ 34.51 $ 57.07 7.5% Retail Units in Parks € 96.00 € 144.00 $ 13.38 $ 20.07 8.0%
Community Power Center (Big Box) € 70.00 € 87.00 $ 9.29 $ 11.55 7.5% Community Power Center (Big Box) € 60.00 € 240.00 $ 8.36 $ 33.46 1.0%
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 € 62.00 € 70.00 $ 8.23 $ 9.29 9.0% Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF
Office in CBD € 4,360.00 € 13,081.00 $ 578.65 $ 1,736.08 Office in CBD € 250.00 € 1,000.00 $34.85 $139.41
Land in Office Parks € 2,100.00 € 3,200.00 $ 278.71 $ 424.70 Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks € 2,000.00 € 3,052.00 $ 265.44 $ 405.05 Land in Industrial Parks € 20.00 € 50.00 $ 2.79 $ 6.97
Office/Industrial Land - Non-park € 2,180.00 € 3,488.00 $ 289.32 $ 462.92 Office/Industrial Land - Non-park € 10.00 € 50.00 $ 1.39 $ 6.97
Retail/Commercial Land € 2,000.00 € 3,052.00 $ 265.44 $ 405.05 Retail/Commercial Land € 20.00 € 200.00 $ 2.79 $ 27.88
Residential € 2,620.00 € 8,000.00 $ 347.72 $ 1,061.74 Residential € 10.00 € 170.00 $ 1.39 $ 23.70

Sofia, Bulgaria Prague, Czech Republic
The downturn was first felt in October 2008. Deteriorating With a global economic downturn and GDP in negative
domestic demand has led to a contraction of Bulgaria’s territory, the Czech Republic has witnessed a slowdown in
economy by 5.8-7.1% in Q2 2009. The country's economy development and investment throughout all of 2009. New
deteriorated significantly throughout 2009. Investment volume office, retail and industrial development has significantly
is off 60% compared to 2008. Most commercial development diminished due to a lack of financing and reduced tenant
plans have either been stopped or are on hold. demand. This also applies to shopping centre development,
The market was characterized by weakened domestic which has almost come to a halt.
demand in comparison to the previous year. Rising exports Prague has 2.6 million SM of modern office space composed
will help offset that weakened demand, but expectations are of 50% inner city, 30% outer city and 20% city centre with
for continued negative GDP. Mostly because the adjustment 70% new buildings and 30% refurbished. Vacancy is around
process is still going on and because the currency is fixed, 13%. Prague will see about 130,000 SM of new space in
most of this adjustment takes place at a slower pace. Recent 2009, a year over year drop of 60%. Pankrac Budejovicka’s
data indicates that inflation is heading to a negative territory office hub continued to be the preferred location. Significant
which, in turn, is also hurting the GDP growth. Bulgaria projects include Prague Marina, Factory Futurama and
reported a monthly deflation of non-EU harmonized Prague 8. Only 85,000 SM of modern office space will come
consumer prices for July, for a third month in a row. We are on the Prague market in 2010. This will ease the
Contact seeing a further deterioration in domestic demand, which is Contact demand/supply situation and help to maintain rents.
NAI ProCon the key factor for the deepening erosion of GDP. At the same NAI MIPA
The Czech Republic has 240 SM of shopping centre space
+359 2 943 43 75 time, net exports should be contributing positively but that +420 224 818 677
per 1,000 inhabitants. Of this, 1.9 million is in shopping
will not be enough to offset the slump of the domestic centres and 600,000 SM in retail parks. Openings
demand component. include Forum Liberec (20,000 SM), Liberec Plaza (19,500
Plans to start development of nine industrial parks are on SM), Skodovka Klatovy (16,000 SM), Forum Usti nad labem
hold. Most of the transactions are done by local players. The (26,400 SM), Olympia Brno (25,000 SM), Area Bory Phase
only property transactions that are continuing are the sea- II (15,000 SM), Atrium Hradec Kralove (7,300 SM) and retail
sonal and holiday properties along the Black Sea coast, but Park Kladno (6,000 SM). There are currently two outlet
even those are moving along at a much slower pace. Banks centers. There is a total inventory of 3,277,000 SM of indus-
have gradually started to open up for credit but at much trial space in the region; 1,600,000 SM in Prague and
Country Data higher interest rates than a year ago. Country Data* 1,680,000 SM in the rest of the Czech Republic. Vacancy is
The office market has remained the most developed at 20%. Rent remains low at €3-€4.5/SM/month.
Area (KM2) 1334.3 Area (KM2) 1334.3
commercial property sector in Bulgaria, primarily concen- The commercial real estate investment market is experi-
trated in Sofia. Vacancy rates are in the range of 13.5% with encing a surprisingly low level of activity and of the four
vacancy rates of 19.6% in the suburban areas. Four new significant office investments transacted in 2009, two were
shopping malls opened and reached 220,000 SM. The first agreements made from previous years. The most signifi-
GDP 2009 (US$ B) $44.78 GDP 2009 (US$ B) $189.67
Carrefour hypermarket opened n Burgas. cant transactions have been the purchase of Jungmannova
Plaza Gemini and Prague 4 by Deka. Yields were 7% and
GDP/Capita (US$) $5,916.22 GDP/Capita (US$) $18,193.65 7.5%, respectively.
Financing of new developments remains key. Rates are
down but pre-leasing requirements are up. Since demand
Unemployment
for space is dramatically reduced, this has led to many
Unemployment 8.23% 7.93%
Rate (%) Rate (%) development sites being put on hold.
Sofia At A Glance Prague At A Glance

Conversion: 0.6681 € = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion: .793 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) € 25.00 € 35.00 $ 41.72 $ 58.40 N/A New Construction (AAA) € 220.00 € 240.00 $ 29.62 $ 32.31 13.0%
Class A (Prime) € 10.00 € 16.00 $ 16.69 $ 26.70 N/A Class A (Prime) € 140.00 € 180.00 $ 18.85 $ 24.24 13.5%
Class B (Secondary) € 5.00 € 10.00 $ 8.34 $ 16.69 N/A Class B (Secondary) € 130.00 € 160.00 $ 17.50 $ 21.54 14.0%
New Construction (AAA) € 15.00 € 25.00 $ 25.03 $ 41.72 N/A New Construction (AAA) € 160.00 € 180.00 $ 21.54 $ 24.24 13.0%
Class A (Prime) € 8.00 € 12.00 $ 13.35 $ 20.02 N/A Class A (Prime) € 140.00 € 160.00 $ 18.85 $ 21.54 11.0%
Class B (Secondary) € 5.00 € 7.00 $ 8.34 $ 11.68 N/A Class B (Secondary) € 100.00 € 130.00 $ 13.46 $ 17.50 10.0%
Bulk Warehouse € 3.00 € 5.00 $ 5.01 $ 8.34 N/A Bulk Warehouse € 66.00 € 72.00 $ 8.89 $ 9.69 3.0%
Manufacturing € 2.00 € 4.00 $ 3.34 $ 6.67 N/A Manufacturing € 55.00 € 60.00 $ 7.41 $ 8.08 3.0%
High Tech/R&D € 4.00 € 6.00 $ 6.67 $ 10.01 N/A High Tech/R&D € 40.00 € 50.00 $ 5.39 $ 6.73 3.0%
RETAIL RETAIL
City Center (High Street Shop) € 50.00 € 100.00 $ 83.43 $ 166.87 N/A City Center € 1,320.00 € 1,800.00 $ 177.73 $ 242.35 2.0%
Neighborhood Service Centers € 20.00 € 40.00 $ 33.37 $ 66.75 N/A Neighborhood Service Centers € 420.00 € 480.00 $ 56.55 $ 64.63 5.0%
Community Power Center(Big Box) € 6.00 € 8.00 $ 10.01 $ 13.35 N/A Community Power Center (Big Box) € 100.00 € 140.00 $ 13.46 $ 18.85 3.0%
Regional Shopping Centers/Mall € 15.00 € 25.00 $ 25.03 $ 41.72 N/A Regional Shopping Centers/Malls € 480.00 € 660.00 $ 64.63 $ 88.86 5.0%
Solus Food Stores € 6.00 € 8.00 $ 10.01 $ 13.35 N/A Solus Food Stores € 120.00 € 140.00 $ 16.16 $ 18.85 N/A
Office in CBD N/A N/A N/A N/A Office in CBD € 300.00 € 1,000.00 $ 40.39 $ 134.64
Land in Office Parks N/A N/A N/A N/A Land in Office Parks € 116.00 € 166.00 $ 15.62 $ 22.35
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks € 30.00 € 60.00 $ 4.04 $ 8.08
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park € 16.00 € 33.00 $ 2.15 $ 4.44
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land € 40.00 € 70.00 $ 5.39 $ 9.42
Residential N/A N/A N/A N/A Residential € 30.00 € 90.00 $ 4.04 $ 12.12

Copenhagen, Denmark Finland
Forced sales of properties and asset management have The Finnish economy seems to have reached the bottom
been a dominant part of the 2009 market in Copenhagen. but Finland’s recovery from the recession will take time.
The interest rate had fallen steadily during 2009 to the Finland became a victim of the global crisis mainly due to
current 1.25% but is expected to increase during 2010. The its export-driven economy while its domestic business
unemployment rate has increased to approximately 4% and remained relatively healthy. Since approximately 45% of
is expected to increase in 2010. GDP in 2009 is expected Finnish GDP accounts from foreign trade, Finland’s recovery
to end negative at -4.1% but turn around to 1.5% in 2010. is very much based on the recovery of its trade partners. An
Office vacancy increased in 2009 to the current level of upward turn in the Finnish economy is expected to start late
4.7 % in the CBD. We expect the vacancy rate to increase 2010 into early 2011.
further in 2010. One of the largest new office developments During 2009 the transaction volume in the Finnish property
is the 25,000 SM SEB Bank property. Jeudan has just market has been very low. Reasons for this stem from poor
acquired office properties totaling approximately €400 million. availability, high financing margins and the fact that sellers
Prime industrial locations along the highways and attractive and buyers have a wide gap in their yield expectations. From
facilities are still hard to find in Copenhagen, which has kept its highest volume in 2007, transaction volume has
the rent level stable. We believe that the rent will stay level decreased approximately 80%. At the moment, 65% of
in 2010. The vacancy rate rose from 1.9% in the capital investors are domestic compared to 54% in 2008 and 35%
Contact Contact in 2007. In the Helsinki Metropolitan Area (HMA), over the
area to approximately 2.8%.
NAI Denmark NAI Premises span of the past year the prime office yield level has risen
+45 70 23 00 26 The retail market has been severely affected by the financial +358 46 712 2197 from 5% to 6%. During the past year, more than 400,000
crisis and rent levels have fallen by approximately 20% in SM of new office space has been completed in the HMA
the Copenhagen area. In the primary retail streets, there area. This has increased the vacancy rates almost 40%
is still no real vacancy. The vacancy has primarily hit the compared to last year’s figures. At the same time, rents have
secondary locations. The vacancy rate for the greater decreased, which has affected Net Operating Income at
Copenhagen area is 3%, which is expected to increase the property level and decreased transaction volumes. The
slightly in 2010. current vacancy rate for 2009 in HMA is approximately
The demand for properties in general, is still very low due to 6.8% compared to 4.6% in 2008.
financial uncertainty. Even a very low interest rate has not The past year was not without significant transactions. In
Country Data helped much. Yields in general have increased. Distressed Country Data Q1 Google bought an old paper industry property from Stora
properties have, on many occasions, been bought by the Enso for €40,000,000. In Q2, Etera Mutual Pension Insur-
Area (KM2) 1334.3 banks that have the largest securities. We are expecting the Area (KM2) 338,424 ance Company sold its office properties, Swing Life Science
prices will find a stable level in the beginning of 2010. Center, for €120,000,000 to Fund of Commerz Real AG. In
GDP Growth (%) -2.43% The investment market is slowly starting to loosen up and GDP Growth (%) -7.00% Q3, Finnair Facilities Management made a sale-leaseback
during 2009 there have been a few large transactions. The transaction and sold its properties for €77,000.000 to NV
GDP 2009 (US$ B) $308.32 pension funds are willing to buy at competitive levels, but the GDP 2009 (US$ B) $242.33 Property Fund I.
core properties they are targeting are very scarce. Unemployment has been relatively low during the past several
GDP/Capita (US$) $55,942.17 GDP/Capita (US$) $45,876.38 years due to the strong growth of the Finnish economy.
While the employment rate was near 6.4% in 2008, it is
Inflation Rate (%) 1.68% Inflation Rate (%) 3.00% expected to increase to almost 10% in 2010 based on the
GDP’s 1% growth in 2008 versus the prediction of -7%
Unemployment 3.50% Unemployment 8.74% growth in 2009.
Rate (%) Rate (%)
Copenhagen At A Glance Finland At A Glance

Conversion: 5.4824 DKK = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion: .793 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
CENTER CITY OFFICE CITY CENTER OFFICE
New Construction (AAA) DKK 1,300.00 DKK 1,900.00 $ 22.03 $ 32.20 5.0% New Construction (AAA) € 22.00 € 27.00 $ 30.93 $ 37.96 N/A
Class A (Prime) DKK 1,200.00 DKK 1,700.00 $ 20.33 $ 28.81 4.7% Class A (Prime) € 22.00 € 27.00 $ 30.93 $ 37.96 4.7%
Class B (Secondary) DKK 700.00 DKK 1,000.00 $ 11.86 $ 16.95 7.0% Class B (Secondary) € 17.00 € 21.00 $ 23.90 $ 29.52 6.2%
New Construction (AAA) DKK 900.00 DKK 1,300.00 $ 15.25 $ 22.03 5.0% New Construction (AAA) € 17.00 € 19.00 $ 23.90 $ 26.71 10.5%
Class A (Prime) DKK 850.00 DKK 1,100.00 $ 14.40 $ 18.64 5.0% Class A (Prime) € 15.00 € 18.00 $ 21.09 $ 25.31 11.1%
Class B (Secondary) DKK 500.00 DKK 850.00 $ 8.47 $ 14.40 6.5% Class B (Secondary) € 9.00 € 14.00 $ 12.65 $ 19.68 14.0%
Bulk Warehouse DKK 350.00 DKK 600.00 $ 5.93 $ 10.17 2.5% Bulk Warehouse € 6.00 € 7.50 $ 8.44 $ 10.54 5.3%
Manufacturing DKK 350.00 DKK 600.00 $ 5.93 $ 10.17 3.0% Manufacturing € 5.00 € 7.00 $ 7.03 $ 9.84 5.3%
High Tech/R&D DKK 400.00 DKK 650.00 $ 6.78 $ 11.01 2.5% High Tech/R&D € 6.00 € 8.00 $ 8.44 $ 11.25 5.3%
RETAIL RETAIL
Downtown DKK 3,500.00 DKK 15,000.00 $ 59.31 $ 254.18 1.3% Downtown € 25.00 € 140.00 $ 35.15 $ 196.82 2.3%
Neighborhood Service Centers DKK 900.00 DKK 2,500.00 $ 15.25 $ 42.36 4.5% Neighborhood Service Centers € 11.00 € 40.00 $ 15.46 $ 56.23 2.8%
Community Power Center DKK 1,000.00 DKK 2,200.00 $ 16.95 $ 37.28 3.0% Community Power Center € 11.00 € 40.00 $ 15.46 $ 56.23 2.9%
Regional Malls DKK 100.00 DKK 2,200.00 $ 16.95 $ 37.28 3.0% Regional Malls € 11.00 € 40.00 $ 15.46 $ 56.23 2.9%
Solus Food Stores DKK 900.00 DKK 1 ,500.00 $ 15.25 $ 25.42 1.5% Solus Food Stores € 9.00 € 16.00 $ 15.46 $ 56.23 3.0%
Office in CBD DKK 1,800.00 DKK 4,000.00 $ 30.50 $ 67.78 Office in CBD N/A N/A N/A N/A
Land in Office Parks DKK 1,500.00 DKK 3,500.00 $ 25.42 $ 59.31 Land in Office Parks € 275.00 € 500.00 $ 346.78 $ 630.52
Land in Industrial Parks DKK 1,200.00 DKK 3,000.00 $ 20.33 $ 50.84 Land in Industrial Parks € 175.00 € 300.00 $ 220.68 $ 378.31
Office/Industrial Land - Non-park DKK 1,500.00 DKK 2,750.00 $ 25.42 $ 46.60 Office/Industrial Land - Non-park € 225.00 € 275.00 $ 283.73 $ 346.78
Retail/Commercial Land DKK 1,800.00 DKK 4,000.00 $ 30.50 $ 67.78 Retail/Commercial Land € 250.00 € 400.00 $ 315.26 $ 504.41
Residential DKK 1,000.00 DKK 3,000.00 $ 16.95 $ 50.84 Residential € 250.00 € 600.00 $ 315.26 $ 756.62

Paris lle de France (Paris Region), France Frankfurt am Main, Germany
Despite technical factors such as the impact of companies The German market seems to be overcoming the crisis
restocking their inventories or the ramp-up of government faster than anticipated. GDP for 2010 will increase by
stimulus packages, the French government has maintained 0.75%. Unemployment is at 8.0%, up from 7.4% in 2008
its prediction that the economy in France will not emerge with an increase expected in 2010. The real estate market
from recession until sometime in 2010. The employment shows falling prices and modest levels of activity in most
market suffers of this context, in particular in Greater Paris. sectors.
The real estate market has been hit hard by this challenging For many companies, the weak economy, combined
economic environment. Adding to the difficulties is investment with the ongoing restrictive loan environment, represents a
activity hit by the freeze in the volume of capital committed threat to their very existence. These factors continue to
following the onset of the financial crisis, ongoing tight credit impact demand in all real estate sectors. A clear recovery
conditions, hesitancy among market players and the persistent in the market is unlikely in the next six to nine months. If
gap between appraisal values and market values. improvement in the global economic situation is sustained,
Office property accounted for 53% of total investments com- the real estate market should show a slight improvement in
pared to 80% during the peak in the investment cycle. Q3 2010, and then move laterally for a year or two.
A total of 1.8 million SM is expected to enter Greater Paris The investment market saw weakened demand from
Contact in 2009, which is 36% less than 2008. This level of take-up Contact investors during the first half of 2009, which impacted
should remain stable in 2010. Demand for office space was investment volume in the most important German business
NAI Evolis NAI apollo
stifled by worsening employment conditions and deteriorating centers: Berlin, Düsseldorf, Frankfurt, Hamburg, Munich and
+33 1 81 72 00 00 +49 69 970 50 50
corporate balance sheets. Furthermore, many tenants opted Stuttgart. Transaction volume dropped almost 65% to €715
to renegotiate their leases rather than move to cheaper million, down from €2 billion in 2008. Prime yields were
premises. 5.5%, up from 4.6% in 2008. Prime property prices have
An exception has been the public sector, which was very fallen by 17% reflecting the weakening demand for office
active, led by 22,000 SM of office space leased by SNCF space and the resultant increase in vacancy with rates
(national train company) in the CNIT in La Défense. This was predicted to increase.
the largest transaction of the year. On the supply side, the Leased office space in Frankfurt in the first nine months was
arrival on the market of a significant volume of new office approximately 273,000 SM, a 30% decrease from 395,000
Country Data space launched in 2007 contributed to an increase in the Country Data SM in 2008. Locations with the highest demand included
office stock that is expected to reach 5 million SM at the the financial district/trade fair district with 125,132 SM, the
Area (KM2) 1334.3
end of the year. This would represent a vacancy rate of 8% Area (KM2) 356,854
city center/railway station at 20,330 SM and the City
by the end of 2009. West/Bockenheim area at 18,526 SM. Roughly 340,000
The 2010 French real estate market should look nearly the SM is forecast to be absorbed in the market in 2009.
GDP Growth (%) -2.36% GDP Growth (%) 1.9
same as in 2009, even with expectations that the invest- New development and refurbishments in the first six months
GDP 2009 (US$ B) $2,634.82 ment market will recover thanks to an adjustment between GDP 2008 (US$ B) 3,818.47 of 2009 were at 100,450 SM up from 92,000 SM in 2008.
seller prices and buyer expectations. A decline is expected for 2010 and 2011 due to finance
GDP/Capita (US$) $42,091.33 GDP/Capita (US$) 46,498.65
problems for projects without pre-leasing. Prime rent is at
€34.00/SM/month, down from €42.00/SM/month in 2008.
Average rent is at €16.00/SM/month, down from
Inflation Rate (%) 0.34% Inflation Rate (%) 2.9
€21.50/SM/month in 2008. The vacancy rate is 14.4% with
Unemployment 1,699,000 SM, slightly up from 1,650,000 SM in 2008.
9.54% Unemployment
Rate (%) The industrial market in Frankfurt and surrounding areas
Rate (%) 8.0
Interest Rate(%) 1.00% leased approximately 225,000 SM in the first nine months.
Population (Millions) 82.1 Prime rents were at €6.00/SM/month and the average rent
Population (Millions) 62.598 was €4.50/SM/month, both unchanged from 2008. The
2009 forecast for absorption is approximately 250,000-
300,000 SM.
Paris At A Glance Frankfurt am Main At A Glance
Conversion: 0.6727 € = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion: .793 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/MO
New Construction (AAA) € 550.00 € 700.00 $ 75.96 $ 96.67 6.5% Class A (Prime) € 270.00 € 471.00 $ 35.83 $ 62.51 14.09%
Class A (Prime) € 420.00 € 600.00 $ 58.00 $ 82.86 6.0% Class B (Secondary) € 147.00 € 234.00 $ 19.51 $ 31.06 14.09%
Class B (Secondary) € 250.00 € 450.00 $ 34.53 $ 62.15 6.5% Average City Center € 225.00 € 360.00 $ 29.86 $ 47.78 14.09%
New Construction (AAA) € 180.00 € 320.00 $ 24.86 $ 44.19 8.0% Westend Class A (Prime) € 252.00 € 456.00 $ 33.44 $ 60.52 14.09%
Class A (Prime) € 150.00 € 250.00 $ 20.72 $ 34.53 10.0% Westend Class B (Secondary) € 162.00 € 288.00 $ 21.50 $ 38.22 14.09%
Class B (Secondary) € 120.00 € 200.00 $ 16.57 $ 27.62 11.0% Suburban Class A (Prime) € 150.00 € 192.00 $ 19.91 $ 25.48 14.09%
INDUSTRIAL Suburban Class B (Secondary) € 138.00 € 150.00 $ 18.32 $ 19.91 N/A
Bulk Warehouse € 45.00 € 50.00 $ 6.21 $ 6.91 N/A INDUSTRIAL
Manufacturing € 55.00 € 75.00 $ 6.21 $ 6.91 N/A Bulk Warehouse € 42.00 € 81.00 $ 5.57 $ 10.75 N/A
High Tech/R&D € 50.00 € 130.00 $ 6.91 $ 17.95 N/A Manufacturing € 48.00 € 81.00 $ 6.37 $ 10.75 N/A
RETAIL High Tech/R&D € 54.00 € 180.00 $ 7.17 $ 23.89 N/A
City Center € 7,500.00 € 10,500.00 $1,035.78 $1,450.09 N/A RETAIL
Retail Units in Parks € 170.00 € 190.00 $ 23.48 $ 26.24 N/A Zeil (Prime Shop Units) € 2,400.00 € 3,120.00 $ 318.52 $ 414.08 N/A
Community Power Center (Big Box) N/A N/A N/A N/A N/A Goethe Strasse (Prime Shop Units) € 1,470.00 € 2,640.00 $195.09 $ 350.37 N/A
Regional Shopping Centers/Malls € 150.00 € 180.00 $ 20.72 $ 24.86 N/A Community Power Center (Big Box) € 96.00 € 180.00 $ 12.74 $ 23.89 N/A
Solus Food Stores N/A N/A N/A N/A N/A Regional Centers/Malls € 96.00 € 180.00 $ 12.74 $ 23.89 N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF Solus Food Stores € 144.00 € 92.00 $ 19.11 $ 25.48 N/A
Office in CBD N/A N/A N/A N/A DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF
Land in Office Parks N/A N/A N/A N/A Office in CBD € 3,000.00 € 19,600.00 $ 398.15 $ 2,601.26
Land in Industrial Parks N/A N/A N/A N/A Land in Office Parks € 400.00 € 1,000.00 $ 53.09 $ 132.72
N/A N/A N/A N/A Land in Industrial Parks € 160.00 € 250.00 $ 21.23 $ 33.18
Office/Industrial Land - Non-park
N/A N/A N/A N/A Office/Industrial Land - Non-park € 170.00 € 250.00 $ 22.56 $ 33.18
Retail/Commercial Land
N/A N/A N/A N/A Retail/Commercial Land € 180.00 € 250.00 $ 23.89 $ 33.18
Residential
Residential € 500.00 € 1,000.00 $ 66.36 $ 132.72
Athens, Greece Reykjavik Iceland
Greece weathered the economic crisis fairly well despite a The economic situation in Iceland has been uncertain
15.8% drop in building permits. The market is looking to the throughout 2009 because of the collapse of 80% of the
new government for a way out from Ministry decisions con- banking system in October 2008. The property market has
cerning matters of semi-sheltered spaces. Property taxation been extremely slow. The number of commercial real estate
is another major issue for 2010. The market awaiting gov- sales is only about 10-20% of the volume recorded in 2007.
ernment provided incentives to boost construction through The economy is export driven with fish and aluminum
cheaper loans, radical changes in urban planning laws and the primary exports, and the domestic tourist business is
efforts towards tying up loose ends that deter foreign in- booming because of the low value of the Icelandic krona.
vestors from investing. Further, the market is eagerly await- The property market in Iceland has been slow or almost
ing resolution of major projects Votanikos, Galatsi and frozen throughout 2009. Most deals that occur involve
Mesogeia malls. smaller units where buyers are using the opportunity to
The office market in Athens is estimated at over 2 million SM buy into a good location now at a lower price than in the
with the vast majority being under 500 SM floor plates. Re- last few years. Many of the Icelandic real estate holding
cent Class A buildings tend to be from 800 SM to 1,000 companies have gone or are going bankrupt, so the owner-
SM. Older buildings have limited or no parking. Current ex- ship of a large part of the leased out real estate base is
isting inventory is estimated between 50,000 SM to 75,000 changing hands, mostly to the new government-owned
Contact SM with less than 25,000 SM under construction. Vacancy Contact banks. It is not yet known if or when these properties will be
NAI Ktimatiki rates are estimated at 7-8% for all classes, mainly due to NAI Reykjavik sold in the market.
+30 210 3628559 corporate consolidations. Demand for over 2,000 SM to + 354 5331122
The fundamentals in the Icelandic economy are the export
8,000 SM is high, however, supply is limited. Yields in- of fish and aluminum, which have been enjoying the very
creased from their low of 6% to reach 7-7.5%. weak Icelandic krona. Also the tourism in Iceland has been
Property prices on prime locations in Thessaloniki high- booming, which again has resulted in increasing demand
streets have dropped by an estimated 5-10%, while in other for hotel rooms. Banks have been more willing to lend into
locations prices have dropped by over 15% in some cases. hotel development projects than any other type of projects.
On Tsimiski Street, ground retail spaces are leased for €100- Many office, retail and residential development projects have
€150/SM and sale prices reach €30,000 to €35,000/SM, been delayed or cancelled, and in the immediate future such
while the same numbers for Mitropoleos Street are €50/SM new projects are not likely to be started. The Icelandic
Country Data and €8,000 to €10,000/SM, respectively. Country Data government has applied for Iceland to become a member of
Retail investments in Thessaloniki seem undeterred by the the EU. Some investors may see that as an opportunity to
Area (KM2) 1334.3 Area (KM2) 1334.3 invest in Iceland.
crisis. Louis Vuitton leased a further 100 SM for its store,
while Inditex signed deals for four city center stores, includ- The value of the Icelandic krona is very low now. Prices of
ing an €8.2 million leasing deal for its Pull & Bear brand. properties have come down. Iceland may join the EU within
Eurobank Properties REIC purchased three retail stores to- the next two years and adopting the Euro within five years.
GDP 2009 (US$ B) $338.25 GDP 2009 (US$ B) $11.78
taling 33,000 SM leased to Praktiker Hellas, a subsidiary of
German Praktiker AG. The deal closed at a reported price of
GDP/Capita (US$) $30,304.75 €46 million, which is an estimated 9.5% reduction from a GDP/Capita (US$) $36,873.43
2006 reported value. The yield is at 8.3%.
Tourism income fell 10.7% and shipping income dropped
Unemployment
38.7% in August 2009 compared to the same period in Unemployment
9.50% 8.62%
Rate (%) 2008, while current account balance remained unchanged Rate (%)
at €425 million. Travel expenditure from non-locals dropped
10.7% over August 2008, while locals increased spending
Population (Millions) 11.162 9.7%. Transportation gross receipts (mostly shipping) Population (Millions) 0.319
dropped 38.7%, while income account deficit dropped by
€56 million.
Athens At A Glance Reykjavik At A Glance

Conversion .793 EUR = 1 US$ RENT/M2/MONTH US$ RENT/SF/YEAR Conversion: 122 ISK = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) € 16.00 € 22.00 $ 26.62 $ 36.61 10.0% New Construction (AAA) ISK 1,322.00 ISK 1,983.00 $ 12.08 $ 18.12 N/A
Class A (Prime) € 15.00 € 21.00 $ 24.96 $ 34.94 10.0% Class A (Prime) ISK 1,322.00 ISK 1,983.00 $ 12.08 $ 18.12 N/A
Class B (Secondary) € 9.00 € 12.00 $ 14.98 $ 19.97 15.0% Class B (Secondary) ISK 1,133.00 ISK 1,416.00 $ 10.35 $ 12.94 N/A
New Construction (AAA) € 16.00 € 21.00 $ 26.62 $ 34.94 10.0% New Construction (AAA) ISK 850.00 ISK 1,133.00 $ 7.77 $ 10.35 N/A
Class A (Prime) € 14.00 € 20.00 $ 23.29 $ 33.28 10.0% Class A (Prime) ISK 850.00 ISK 1,133.00 $ 7.77 $ 10.35 N/A
Class B (Secondary) € 10.00 € 13.00 $ 16.64 $ 21.63 15.0% Class B (Secondary) ISK 708.00 ISK 945.00 $ 6.47 $ 8.64 N/A
Bulk Warehouse € 4.50 € 7.50 $ 7.49 $ 12.48 5.0% Bulk Warehouse ISK 708.00 ISK 1,039.00 $ 6.47 $ 9.49 N/A
Manufacturing € 6.00 € 8.00 $ 9.98 $ 13.31 N/A Manufacturing ISK 708.00 ISK 1,039.00 $ 6.47 $ 9.49 N/A
High Tech/R&D € 7.00 € 8.50 $ 11.65 $ 14.14 N/A High Tech/R&D ISK 850.00 ISK 1,322.00 $ 7.77 $ 12.08 N/A
RETAIL RETAIL
Downtown € 35.00 € 290.00 $ 58.24 $ 482.54 15.0% City Center ISK 1,417.00 ISK 2,834.00 $ 12.95 $ 25.90 N/A
Neighborhood Service Centers € 20.00 € 40.00 $ 33.28 $ 66.56 15.0% Neighborhood Service Centers ISK 1,133.00 ISK 1,700.00 $ 10.35 $ 15.53 N/A
Community Power Center (Big Box) € 11.00 € 18.00 $ 18.30 $ 29.95 N/A Community Power Center (Big Box) ISK 1,133.00 ISK 1,606.00 $ 10.35 $ 14.68 N/A
Regional Malls € 20.00 € 150.00 $ 33.28 $ 249.59 N/A Regional Shopping Centers/Malls ISK 1,606.00 ISK 2,361.00 $ 14.68 $ 21.57 N/A
Solus Food Stores € 9.00 € 14.00 $ 14.98 $ 23.29 N/A Solus Food Stores ISK 1,417.00 ISK 1,983.00 $ 12.95 $ 18.12 N/A
Office in CBD € 5,000.00 € 12,000.00 $ 7,462.69 $ 17,910.45 Office in CBD ISK 6,100,000 ISK 9,760,000 $ 4,645.11 $ 7,432.18
Land in Office Parks N/A N/A N/A N/A Land in Office Parks ISK 1,220,000 ISK 3,660,000 $ 929.02 $ 2,787.07
Land in Industrial Parks € 120.00 € 245.00 $ 179.10 $ 365.67 Land in Industrial Parks ISK 1,220,000 ISK 3,660,000 $ 929.02 $ 2,787.07
Office/Industrial Land - Non-park € 150.00 € 300.00 $ 223.88 $ 447.76 Office/Industrial Land - Non-park ISK 1,220,000 ISK 3,660,000 $ 929.02 $ 2,787.07
Retail/Commercial Land € 1,600.00 € 2,700.00 $ 2,388.06 $ 4,029.85 Retail/Commercial Land ISK 1,220,000 ISK 3,660,000 $ 929.02 $ 2,787.07
Residential € 1,000.00 € 3,000.00 $ 1,492.54 $ 4,477.61 Residential ISK 2,440,000 ISK 9,760,000 $ 1,858.05 $ 7,432.18

Tel Aviv, Israel Almaty, Kazakhstan
The condition of the Israeli economy in the last year is rela- Almaty is the largest city in Kazakhstan with a population
tively stable compared to the current global crisis. Israeli of more than 1.5 million. It plays an important role as the
banks did not collapse and most of their losses are a result business hub for all of Central Asia. According to official
of real estate investments abroad that the banks funded for statistics, GDP growth in 2008 was 3.3% and is forecasted
their Israeli clients, mainly in Eastern Europe. to drop to 2% in 2009. The inflation rate was fixed at 9.5%
In 2009, the Israeli real estate market acted contrary to the by the end of 2008. The economy of Kazakhstan is based on
trends. The residential market had a significant increase of oil and gas, mining, metals, grain and the production of other
15% compared with 2008. The activity in the commercial natural resources.
real estate market divided as follows: In the office market, no Office rental rates fell significantly by an average of more
new projects started construction and some of the projects than 40-50% during 2008 and Q1 2009. The market seems
under construction were halted. New sublease properties to have stabilized in Q3 2009 when the rental rates hit
entered the market and caused a price drop of about 17%, bottom. By October 2009, the average net rent office space
causing the demand to decline significantly. fell to US $35/SM/month US $20/SM/month for Class A
Most of the activity in the market focused in yield deals. The space and US $20/SM/month for Class B.
beginning of the year reflected a yield of about 9.5%, while International mass market retailers such as Mango, Promod,
Contact end of the year yields declined to 8% reflecting the growing Contact Celio and Sinequanone all reported a robust increase in their
demand for yield properties. sales volumes in Kazakhstan and noted they are positioned
NAI Yair Levy Strategy NAI Aristan
In the industrial market, the building of new structures or among the top compared with similar stores worldwide. This
+ 972 3 613 66 99 7 727 278 94 08
sites has not begun and the rent prices are in decline since has resulted in many global retailers looking for regional and
the demand for traditional industries has decreased. In local partners for franchise cooperation in Kazakhstan.
the last year, several new commercial centers opened in However, one of the main obstacles for global retailers to
central Israel, which stimulated great interest among clients. expand in Kazakhstan is a limited number of modern profes-
In Israel, four main groups have formed specializing in retail. sional properties both in shopping centers and the street
In our opinion, most of their future development lies in the retail sector.
expansion of neighborhood commercial centers. We anticipate During 2008 and the first half of 2009, the investment
the start of 2010 will be characterized by serious damage to market was not active. There were almost no inquiries and
Country Data the commercial real estate market and we estimate that the Country Data* institutional foreign investors have stopped financing
residential sector will moderate in the near future. real estate projects seemingly everywhere in the world.
Area (KM2) In the coming year, public companies in the field of the real Area (KM2)
Most of the investment transactions were between local
1334.3 1334.3
estate in Israel will find it difficult to return their bonds, which investors and such deals were not as visible. Local
will force them to sell many properties in the country and commercial banks have disposed of a large number of real
GDP Growth (%) -0.09% GDP Growth (%) -2%
abroad. In our opinion, this may result in further declining estate assets that were pledged over the past few years.
GDP 2009 (US$ B) $215.73 prices in the commercial field. GDP 2009 (US$ B) $107.04 Metro C&C opened its first store in 4Q 2009 in Astana with
plans to open up to 14 centers over the next several years.
GDP/Capita (US$) GDP/Capita (US$) $6,875.50
Inditex Group and Al Hokair Group signed lease agreements
$29,671.59
to open the first Zara store in Almaty by the end of 2009
and the second store in February 2010.

Rate (%) Rate (%)
Tel Aviv At A Glance Almaty At A Glance

Conversion 3.75 NIS = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion 151 KZT = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) NIS 90.00 NIS 120.00 $ 26.76 $ 35.67 12.0% New Construction (AAA) KZT 4,228.00 KZT 5,285.00 $ 31.22 $ 39.02 30.0%
Class A (Prime) NIS 85.00 NIS 110.00 $ 25.27 $ 32.70 8.0% Class A (Prime) KZT 4,077.00 KZT 5,285.00 $ 30.10 $ 39.02 15.0%
Class B (Secondary) NIS 60.00 NIS 70.00 $ 17.84 $ 20.81 15.0% Class B (Secondary) KZT 2,114.00 KZT 3,926.00 $ 15.61 $ 28.99 20.0%
New Construction (AAA) NIS 70.00 NIS 75.00 $ 20.81 $ 22.30 25.0% New Construction (AAA) KZT 2,718.00 KZT 3,775.00 $ 20.07 $ 27.87 20.0%
Class A (Prime) NIS 60.00 NIS 65.00 $ 17.84 $ 19.32 14.0% Class A (Prime) KZT 3,020.00 KZT 4,228.00 $ 22.30 $ 31.22 14.0%
Class B (Secondary) NIS 45.00 NIS 50.00 $ 13.38 $ 14.86 15.0% Class B (Secondary) KZT 1,812.00 KZT 2,567.00 $ 13.38 $ 18.95 10.0%
Bulk Warehouse NIS 34.00 NIS 38.00 $ 10.11 $ 11.30 10.0% Bulk Warehouse KZT 755.00 KZT 1,510.00 $ 5.57 $ 11.15 N/A
Manufacturing NIS 26.00 NIS 28.00 $ 7.73 $ 8.32 5.0% Manufacturing KZT 1,057.00 KZT 1,963.00 $ 7.80 $ 14.49 N/A
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D KZT 1,057.00 KZT 1,963.00 $ 7.80 $ 14.49 N/A
RETAIL RETAIL
Downtown NIS 110.00 NIS 140.00 $ 32.70 $ 41.62 5.0% Downtown KZT 7,550.00 KZT 18,120.00 $ 55.74 $ 133.78 N/A
Neighborhood Service Centers NIS 130.00 NIS 150.00 $ 38.65 $ 44.59 N/A Neighborhood Service Centers KZT 4,530.00 KZT 10,570.00 $ 33.44 $ 78.04 N/A
Community Power Center (Big Box) NIS 70.00 NIS 80.00 $ 20.81 $ 23.78 N/A Community Power Center N/A N/A N/A N/A N/A
Regional Malls NIS 80.00 NIS 100.00 $ 23.78 $ 29.73 N/A Regional Shopping Centres/Malls KZT 3,775.00 KZT 9,815.00 $ 27.87 $ 72.46 N/A
Office in CBD NIS 2,000.00 NIS 2,500.00 $ 49.55 $ 61.93 Office in CBD KZT 226,500.00 KZT 679,500.00 $ 0.01 $ 0.04
Land in Office Parks NIS 1,600.00 NIS 1,800.00 $ 39.64 $ 44.59 Land in Office Parks KZT 120,800.00 KZT 377,500.00 $ 0.01 $ 0.02
Land in Industrial Parks NIS 1,000.00 NIS 1,400.00 $ 24.77 $ 34.68 Land in Industrial Parks KZT 90,600.00 KZT 226,500.00 $ 0.01 $ 0.01
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park KZT 105,700.00 KZT 256,700.00 $ 0.01 $ 0.02
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land KZT 151,000.00 KZT 453,000.00 $ 0.01 $ 0.03
Residential N/A N/A N/A N/A Residential KZT 135,900.00 KZT 302,000.00 $ 0.01 $ 0.02

Kuwait Oslo, Norway
Kuwait, like most world economies, slowed down in 2008- Given the international economic environment Norwegian
09 with negative GDP growth, a decline in exports and industries in general performed quite well during and
struggling credit conditions. However, with oil prices pushing subsequent to the crisis in 2008 and 2009. This can be
$70 a barrel, Kuwait could run a budget surplus of KD 6 credited to rising oil prices and confidence returning to the
billion (US $20 billion) in 2009-10 riding on higher than bank systems in the mid-2009. The Norwegian Economy is
expected oil prices. The real estate sector is expected to moving forward positively.
reenergize with the slowly but steadily improving economic The Norwegian commercial property market was very quiet
backdrop and the impact of a recent legal ruling permitting at the beginning of 2009, but towards the summer activity
financial institutions to trade residential property. started to pick up. During the second half of 2009 more and
2009 saw the opening of the 360° Mall by Tamdeen featuring larger transactions occurred and capital was again available.
a great mix of high-end luxury icons like Yves Saint Laurent, Total transaction volume for 2009 will be less than in 2008,
Burberry, Dolce & Gabbana and the Géant Hypermarket. The but the prospects for 2010 are better. The estimated trans-
average asking rent for retail space in the ground Floor in action volume in 2009 is about US $2.3 billion to $2.7
Kuwait stood at KD 27.5/SM. There is demand for retail billion. There has been a significant increase in prime office
space. This sector was least affected during the economic yields, from 5.75% in July 2008 to 6.75% in July 2009.
crisis and did not witness any drop in rentals. As we approach 2010 the prime yield is decreasing slightly
Contact Contact to 6.5%. Yields in other sectors show similar trends but
In the office sector, 2009 saw the completion of a number
NAI Kuwait NAI FirstPartners less marked.
of high rise office towers, including the Arraya Tower, Al
+1 965 2437717 +47 2301 1400
Tijaria tower and many office towers of smaller scale. This In 2009 rentals decreased dramatically from the record high
has resulted in an oversupply of office space in Kuwait City levels before the crisis, but rentals have now started to
but there is demand for office space towards internal areas. flatten out, and it is expected that this will continue in 2010
The average asking rent for office space in Kuwait stood in most sectors. The industrial market is the least volatile
at KD 7.5/SM. The Al Hamra Tower, currently under con- sector but we did experience a slight correction of rents
struction in downtown Kuwait City, will become the tallest during 2009 and this will level out in 2010. As bankruptcies
building in Kuwait at 412 meters on completion in 2010 and and unemployment did not increase to the anticipated level
will include 98,000 SM of commercial and office space. we have not seen the number of sublettings in the leasing
The expatriate workforce in Kuwait registered a decline market, which at last crisis brought down the rental prices to
Country Data Country Data even lower levels. Vacancies are increasing but absorption is
of 0.85% due to the economic crisis, which resulted in low
demand and increased vacancy in the apartment sector. picking up and is expected to limit the impact on rental prices.
Area (KM2) 1334.3 Area (KM2) 1334.3
The average asking rate for single-bedroom units stands Norway had a soft landing compared to our neighboring
at KD 170, two-bedroom at KD 220 and three bedroom countries and the rapid adjustment in 2009 has revealed
GDP Growth (%) -1.51% GDP Growth (%) 0.11%
at KD 380. opportunities. The economic fundamentals are stable in
The Kuwait government has allocated its largest ever budget Norway and the commercial property market is picking up
GDP 2009 (US$ B) $114.88 GDP 2009 (US$ B) $368.96
of KD 1 billion for housing projects for its citizens. Kuwait at its new levels.
GDP/Capita (US$)
has about 124 projects under construction worth about US GDP/Capita (US$)
$32,491.46 $76,692.09
$114 billion, including major infrastructure projects like the
$7 billion Kuwait Metro, island development projects,
enlargement of road networks, developments of ports and
Unemployment
other infrastructure. Unemployment
7.10% 3.30%
Rate (%) Rate (%)
Kuwait At A Glance Oslo At A Glance

Conversion .2781 KD = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion: 5.63 NOK = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) KD 7.00 KD 12.00 $ 28.06 $ 48.10 6.0% New Construction NOK 2,600.00 NOK 3,100.00 $ 42.90 $ 51.15 2.0%
Class A (Prime) KD 9.00 KD 13.00 $ 36.08 $ 52.11 4.0% Class A (Prime) NOK 2,400.00 NOK 3,000.00 $ 39.60 $ 49.50 6.0%
Class B (Secondary) KD 5.00 KD 8.00 $ 20.04 $ 32.07 2.0% Class B (Secondary) NOK 1,600.00 NOK 2,300.00 $ 26.40 $ 37.95 9.0%
New Construction (AAA) KD 7.00 KD 8.00 $ 28.06 $ 32.07 3.0% New Construction (AAA) NOK 1,700.00 NOK 2,100.00 $ 28.05 $ 34.65 5.0%
Class A (Prime) KD 7.00 KD 10.00 $ 28.06 $ 32.07 2.0% Class A (Prime) NOK 1 ,700.00 NOK 2,000.00 $ 28.05 $ 33.00 5.0%
Class B (Secondary) KD 5.00 KD 7.00 $ 20.04 $ 28.06 1.0% Class B (Secondary) NOK 1,200.00 NOK 1,400.00 $ 19.80 $ 23.10 10.0%
Bulk Warehouse KD 2.00 KD 5.00 $ 8.02 $ 20.04 3.0% Bulk Warehouse NOK 550.00 NOK 950.00 $ 9.08 $ 15.68 5.0%
Manufacturing KD 3.00 KD 10.00 $ 12.03 $ 40.09 3.0% Manufacturing NOK 450.00 NOK 700.00 $ 7.43 $ 11.55 6.0%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D NOK 750.00 NOK 1 ,050.00 $ 12.38 $ 17.33 6.0%
RETAIL RETAIL
Downtown KD 15.00 KD 28.00 $ 60.13 $ 112.24 2.0% City Center NOK 2,500.00 NOK11,000.00 $ 41.25 $ 181.51 4.0%
Neighborhood Service Centers KD 8.00 KD 20.00 $ 32.07 $ 80.17 1.0% Neighborhood Service Centers NOK 1,200.00 NOK 1,500.00 $ 41.25 $ 181.51 6.0%
Community Power Center (Big Box) KD 20.00 KD 30.00 $ 80.17 $ 120.26 2.0% Community Power Center(Big Box) NOK 1,300.00 NOK 2,500.00 $ 21.45 $ 41.25 7.0%
Regional Shopping Centres/Malls KD 20.00 KD 35.00 $ 80.17 $ 140.31 2.0% Regional Shopping Centers/Malls NOK 1,800.00 NOK 5,000.00 $ 29.70 $ 82.51 7.0%
Solus Food Stores KD 9.00 KD 20.00 $ 36.08 $ 80.17 1.0% Solus Food Stores NOK 900.00 NOK 1,500.00 $ 14.85 $ 24.75 7.0%
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/M2 High/M2 Low/M2 High/M2
Office in CBD KD 5,000.00 KD 8,500.00 $ 17,979.14 $ 30,564.55 Office in CBD NOK 10,000.00 NOK 20,000.00 $ 1,776.20 $ 3,552.40
Land in Office Parks N/A N/A N/A N/A Land in Office Parks NOK 3,000.00 NOK 6,000.00 $ 532.86 $ 1,065.72
Land in Industrial Parks KD 400.00 KD 1,250.00 $1,438.33 $ 4,494.79 Land in Industrial Parks NOK 1,500.00 NOK 3,000.00 $ 266.43 $ 532.86
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park NOK 1,000.00 NOK 2,500.00 $ 177.62 $ 444.05
Retail/Commercial Land KD 3,000.00 KD 4,500.00 $10,787.49 $ 16,181.23 Retail/Commercial Land NOK 1,500.00 NOK 4,000.00 $ 177.62 $ 444.05
Residential KD 250.00 KD 1,000.00 $ 898.96 $ 3,595.83 Residential NOK 1,000.00 NOK 5,000.00 $ 177.62 $ 888.10

Doha, Qatar Bucharest, Romania
The State of Qatar is a peninsula located on the Western side Romania is currently experiencing a severe economic
of the Arabian Gulf. Doha is the capital of the country. Qatar recession with GDP expected to contract by 8.5% in 2009.
is one of the fastest growing economies in the world and is However, the country is expected to return to economic
one of the richest countries in the world with the second growth in 2010, and the government has set a target date
largest GDP per capita income. Qatar has the third-largest of 2014 for joining the EU. Due to the political crisis,
natural gas reserves in the world and it has shaped the Romania is in jeopardy of losing the second loan installment
country into one of the most competitive Arab economies. from the World Bank.
Qatar’s construction sector is propelled by the country’s The past year marked a major shift in the supply and
powerful economy and thriving real estate sector. The most demand equilibrium. Tenants have retained a position of
positive aspects in the real estate sector stem from devel- power as the result of a record amount of new office space
opers bringing together timely transfers of high quality, being delivered to the market, falling demand for space and
value-added projects, banks’ improvement in managing increased vacancy rates. The total GLA of modern office
the risks associated with over exposure to the real estate stock has now surpassed the 1 million SM mark following
sector and government efforts to overcome the difficulties. 245,000 SM of new space delivered in the first half of
All of these factors are responsible for creating good the year.
fundamentals in the real estate market in Qatar. Reduced consumption has resulted in falling rents, higher
Contact Contact
There is an excellent demand for office spaces in Doha. The vacancy rates and suspended construction of new projects.
NAI Qatar NAI Property Partners
vacancy rate in the CBD is around 7% and 5% in suburban The total modern retail space in Romania currently stands
+974 4316717 +1 40 21 667 7105
areas where the average rate per SM is low compared to the at approximately 1.16 million SM, with Bucharest claiming
CBD, but with similar facilities. The average asking rate for 450,000 SM of that amount. Despite the economic slow-
office space in the CBD is US $65/SM and in suburban down, some retailers are once again showing an appetite for
areas, the average rate is US $51/SM. expansion encouraged by the flexibility and incentives
The retail sector has a very promising future. The average offered by the landlords.
rate of growth in the retail sector is 21.3%. The growth is During the first half of 2009, both the supply and demand
mainly attributed to the decrease in inflation and increase in of industrial properties declined. Bucharest saw only 40,000
consumer spending. There is a good demand for warehouse SM of new product delivered despite earlier predictions of
Country Data space in Qatar with the average rate of growth at 24.5%. Country Data 175,000 SM. Negligible new supply came to the market in
There is a promising growth in the demand for residential the second half of 2009. The total stock of modern industrial
Area (KM2) apartment units/flats. The average rate (leasehold) for a properties is currently 920,000 SM in the greater
11,437 Area (KM2) 238,391
three-bedroom apartment is US $2,910, US $2,300 for Bucharest-Ilfov area. Following record years in 2007 and
a two-bedroom apartment, and US $1,790 for a single- 2008, the lack of available financing has pushed yields to
GDP Growth (%) 40.90% GDP Growth (%) -8.5%
bedroom apartment. The average asking rate for a villa is US between 9-10% for institutional investment stock.
GDP 2009 (US$ B) $100.40 $4,485 with rates ranging from US $3,560 to US GDP 2009 (US$ B) RON 497.4
The most important acquisition of the year was a takeover
$5,770/SM for freehold properties. on the London Stock Exchange of Fabian Romania Property
Fund by Black Sea Global Properties (BSGS). This deal, worth
GDP/Capita (US$) $ 12,200
€50 million, included six office buildings in Bucharest and
five development sites in other Romanian cities. Following
record years of 2007 and 2008, the lack of available finance
Unemployment
has pushed yields out to 9-10% for institutional investment
0.50% Unemployment 9.6%
Rate (%) Rate (%) stock.
Population (Millions) 16.23 Population (Millions) 22,215,000
Doha At A Glance Bucharest At A Glance

Conversion: 3.64 QAR = 1 US$ RENT/M2/Mo US$ RENT/SF/YR Conversion: 0.793 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction QAR 180.00 QAR 300.00 $ 55.13 $ 91.88 7.0% New Construction (AAA) € 15.00 € 20.00 $ 21.09 $ 28.12 5.0%
Class A (Prime) QAR 160.00 QAR 250.00 $ 49.00 $ 76.57 2.0% Class A (Prime) € 18.00 € 22.00 $ 25.31 $ 30.93 5.0%
Class B (Secondary) N/A N/A N/A N/A N/A Class B (Secondary) € 10.00 € 15.00 $ 14.06 $ 21.09 5.0%
New Construction (AAA) QAR 170.00 QAR 230.00 $ 52.07 $ 70.44 5.0% New Construction (AAA) € 10.00 € 14.00 $ 14.06 $ 19.68 N/A
Class A (Prime) QAR 135.00 QAR 195.00 $ 41.35 $ 59.72 3.0% Class A (Prime) N/A N/A N/A N/A 10.0%
Class B (Secondary) QAR 90.00 QAR 120.00 $ 27.56 $ 36.75 4.0% Class B (Secondary) € 7.00 € 9.00 $ 9.84 $ 12.65 10.0%
Bulk Warehouse QAR 65.00 QAR 90.00 $ 19.91 $ 27.56 20.0% Bulk Warehouse € 3.00 € 4.00 $ 4.22 $ 5.62 10.0%
Manufacturing N/A N/A N/A N/A N/A Manufacturing € 1.50 € 4.00 $ 2.11 $ 5.62 10.0%
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
City Center QAR 740.00 QAR 825.00 $ 226.64 $ 252.67 N/A City Center € 25.00 € 70.00 $ 35.15 $ 98.41 5.0%
Neighborhood Service Centers QAR 250.00 QAR 475.00 $ 76.57 $ 145.48 N/A Neighborhood Service Centers € 5.00 € 20.00 $ 7.03 $ 28.12 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 QAR 575.00 QAR 770.00 $ 176.11 $235.83 N/A Regional Shopping Centers/Malls € 6.00 € 25.00 $ 8.44 $ 35.15 15.0%
Solus Food Stores QAR 225.00 QAR 275.00 $ 68.91 $84.22 5.0% Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/M2 High/M2 DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF
Office in CBD QAR 17,500.00 QAR 24,000.00 $ 4,807.69 $ 6,593.41 Office in CBD € 2,000.00 € 4,000.00 $ 2,522.07 $ 5,044.14
Land in Office Parks N/A N/A N/A N/A Land in Office Parks € 450.00 € 800.00 $ 567.47 $ 1,008.83
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks € 20.00 € 60.00 $ 25.22 $ 75.66
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park € 15.00 € 100.00 $ 18.92 $ 126.10
Retail/Commercial Land QAR 7,500.00 QAR 17,250.00 $ 2,060.44 $ 4,739.01 Retail/Commercial Land € 150.00 € 800.00 $ 189.16 $ 1,008.83
Residential QAR 1,200.00 QAR 5,900.00 $ 329.67 $ 1,620.88 Residential € 80.00 € 2,000.00 $ 100.88 $ 2,522.07

Moscow, Russian Federation St. Petersburg, Russian Federation
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 Baltic countries, and
the economy, still very dependent on raw materials and oil historically has benefited from the positive influence of the
prices, started showing some signs of recovery in fall 2009. dynamic economy in this region. Large international and
Moscow, as the capital and largest city of Russia, has been Russian companies generally decide to be headquartered
hit the hardest over the past 12 months, but is also expected in Moscow, so St. Petersburg has been less impacted by
to see the fastest recovery. the global economic crisis than the rival capital city.
The overall vacancy rate is now higher than 15% for every Over 2009, rents decreased relatively slower than in
type of office and retail property, compared with less than Moscow. Prime office and retail rents, which used to be
3% a year ago. In particular, the vacancy rate for Class A and much lower than in Moscow, are now almost equivalent.
Class B office space reached more than 20%, its highest Rental rates reach $800/SM per year for the best office
level in a decade. Prime rents are at a historically low level, buildings in the city, and $2,500/SM for prime retail prop-
down 40% to 60% compared with 2008, and the share of erties. The industrial market is still largely under supplied,
subleases has significantly increased. It is now possible to and rents resisted the impact of the crisis better than other
lease excellent Class A office space for less than $500/SM sectors. Prime warehouse rental rates are now around
per year in Moscow. Prime retail properties in main retail $170/SM per year and for the first time are at a higher level
Contact corridors can be leased for $2,000/SM per year, compared Contact than in Moscow. The hospitality market has been strongly hit
NAI Becar with $5,000 a year ago. NAI Becar in 2009 with occupancy rates dropping below 50%. But
+7 495 787 42 97 +7 812 490 70 01 hospitality remains attractive to many investors due to the
The Russian hospitality market is doing comparatively better:
Average occupancy is around 50%, versus 70% in 2008. strong tourism potential of the region and lack of European
There were several transactions in this sector in 2009 with standard two- and three-stars hotels.
opportunistic investors buying old assets in Moscow at Investment yields are lower than in Moscow but are
extremely low prices to reconvert them into western hotels. expected to increase as office and retail prices go down over
Other major Russian cities are still largely under-supplied in the coming months. At the current 12% office and retail
hotel rooms, and we expect local and foreign investors to capitalization rates, only local Russian investors are now
remain active in this market throughout 2010. ready to purchase real estate assets. International investors
A significant number of distressed office and retail assets considering larger volumes of investment, $40 million and
Country Data Country Data up, believe the risk reward for investing in St. Petersburg
are now available for sale. Yields for Class A office centers
in Moscow and St. Petersburg are now around 12% to 13%, should be higher than in Moscow, and therefore yields of
Area (KM2) 1334.3 Area (KM2) 1334.3 14% to 15% should be achieved.
or 60% to 100% higher than in 2008.
A majority of investors believe that the market reached its The St. Petersburg market seems to be about to reach its
bottom in Q3 2009. Office yields should remain relatively bottom, a few month after Moscow. Paradoxically, many
stable over 2010 as prices are expected to go up while very owners are still trying to lease or sell properties at pre-crisis
GDP 2009 (US$ B) $1,254.64 GDP 2009 (US$ B) $1,254.64
low current rental rates and occupancy levels should prices, which results in a large gap between the offer and
mechanically increase in Moscow’s still structurally under- the demand. This imbalance is expected to progressively
GDP/Capita (US$) $8,873.61 GDP/Capita (US$) $8,873.61 disappear over 2010.
supplied office market.

Rate (%) Rate (%)
Moscow At A Glance St. Petersberg At A Glance

Conversion: 1 USD = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion: 0.793 EUR = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) $ 650.00 $ 800.00 $ 60.39 $ 74.32 N/A New Construction (AAA) $ 500.00 $ 800.00 $ 46.45 $ 74.32 N/A
Class A (Prime) $ 550.00 $ 800.00 $ 51.10 $ 74.32 N/A Class A (Prime) $ 400.00 $ 800.00 $ 37.16 $ 74.32 N/A
Class B (Secondary) $ 200.00 $ 500.00 $ 18.58 $ 46.45 N/A Class B (Secondary) $ 300.00 $ 400.00 $ 27.87 $ 37.16 N/A
New Construction (AAA) N/A N/A N/A N/A N/A New Construction (AAA) $ 300.00 $ 450.00 $ 27.87 $ 41.81 N/A
Class A (Prime) $ 250.00 $ 500.00 $ 23.23 $ 46.45 N/A Class A (Prime) $ 300.00 $ 450.00 $ 27.87 $ 41.81 N/A
Class B (Secondary) $ 150.00 $ 300.00 $ 13.94 $ 27.87 N/A Class B (Secondary) $ 150.00 $ 300.00 $ 13.94 $ 27.87 N/A
Bulk Warehouse $ 100.00 $ 130.00 $ 9.29 $ 12.08 N/A Bulk Warehouse $ 90.00 $ 100.00 $ 8.36 $ 9.29 N/A
Manufacturing $ 100.00 $ 140.00 $ 9.29 $ 13.01 N/A Manufacturing $ 100.00 $ 140.00 $ 9.29 $ 13.01 N/A
High Tech/R&D $ 120.00 $ 140.00 $ 11.15 $ 13.01 N/A High Tech/R&D $ 120.00 $ 170.00 $ 11.15 $ 15.79 N/A
RETAIL RETAIL
Downtown $ 1,200.00 $ 3,000.00 $ 111.48 $ 278.71 N/A City Center $ 1,600.00 $ 2,500.00 $ 148.64 $ 232.26 N/A
Neighborhood Service Centers $ 500.00 $ 1,500.00 $ 46.45 $ 139.35 N/A Neighborhood Service Centers $ 550.00 $ 1,100.00 $ 51.10 $ 102.19 N/A
Community Power Center $ 1,000.00 $ 2,500.00 $ 92.90 $ 232.26 N/A Community Power Center (Big Box) $ 150.00 $ 300.00 $ 13.94 $ 27.87 N/A
Regional Malls $ 1,200.00 $ 2,500.00 $ 111.48 $ 232.26 N/A Regional Shopping Centers/Malls $ 120.00 $ 260.00 $ 11.15 $ 24.15 N/A
Solus Food Stores $ 400.00 $ 1,300.00 $ 37.16 $ 120.77 N/A Solus Food Stores $ 100.00 $ 200.00 $ 9.29 $ 18.58 N/A
DEVELOPMENT LAND Low/ Hectare High/Hectare Low/Acre High/Acre DEVELOPMENT LAND Low/ Hectare High/Hectare Low/Acre High/Acre
Office in CBD 1,000.00 1,500.00 N/A N/A Office in CBD 700.00 1500.00 N/A N/A
Land in Office Parks 300.00 1,000.00 N/A N/A Land in Office Parks 25.00 1000.00 N/A N/A
Land in Industrial Parks 150.00 750.00 N/A N/A Land in Industrial Parks 50.00 150.00 N/A N/A
Office/Industrial Land - Non-park 150.00 500.00 N/A N/A Office/Industrial Land - Non-park 200.00 1000.00 N/A N/A
Retail/Commercial Land 150.00 2,000.00 N/A N/A Retail/Commercial Land 300.00 1500.00 N/A N/A
Residential 200.00 2,000.00 Residential 200.00 2000.00 N/A N/A

Belgrade, Serbia Johannesburg, South Africa
In the first half of 2009, Serbia’s GDP decreased by 4.1%. Our real estate markets have succumbed to negative capital
The main contributors were manufacturing (-20%), trade growth (source: IPD SA), returning a nominal -0.8% for
(-8%) and construction (-16.1%). Positive to mention are January-June 2009. The retail and industrial sectors both
the latest arrangements with China and Russia, providing recorded a 4.1% total return and offices recorded a total
loans for infrastructural investments worth more than 1.2 return of 1.6%. CPI has surprised everyone by falling to
billion Euros. 2010 will bring a slight recovery, but the return 6.1%, close to the Reserve Bank’s targeted 3-6% range.
to the strong growth rates will not be seen before 2011. While World Cup Soccer 2010 is set to positively affect retail
The total stock of Class A office space increased by 22,000 & hospitality sectors alike, there is concern for employment
SM. to 292,000 SM. An additional 30,000 SM will be deliv- once all related infrastructure initiatives have been completed.
ered by year-end 2009 and an estimated 55,000 SM is B-grade office vacancies increased to 17% in the City
expected to deliver in 2010. The trend looks positive, since Centre and 21.8% in suburban markets, while other office
the reduced rent levels are generating more clients. As a vacancies remained relatively consistent. New development
result of increased supply, the short-term vacancy reached continues on a demand basis only.
28%. But the latest occupier requests are stronger than ex- The industrial sector forms the backbone of the South
pected, leading to absorption of vacant space until 2011. African economy, which has been substantially affected by
Prime rents are currently set at €18/SM/month. Besides the global financial crisis. While rental decrease has been
Contact USCE shopping mall, which opened in March 2009 with Contact
minimal and vacancy rates stagnant in 2009, both will be
NAI Atrium 50,000 SM of net leasable area, only single-box retail NAI FINLAY
adversely affected in 2010.
+ 381 11 2205880 concepts such as KIKA furniture, MERKUR DIY, and Mr. + 27 11 807 4724
Bricolage are under development. All major shopping center Consumer spending is still down and retail turnover is under
developments have been put on hold, explained by the lack immense pressure, but with minimal casualties at this stage.
of finance and increased uncertainty of the rental market. We are likely to see smaller businesses struggle to stay
The Austrian EYEMAXX announced two large-scale logistic afloat in 2010. Larger retail chains have performed well in
projects, in Nis and Belgrade. Both projects are planned to 2009 under the circumstances, but 2010 will prove much
be completed with its first phases in early 2011 offering tougher. However, most retailers anticipate a turnaround by
30,000 SM of leasable area. The entire project comprises mid-2010. Steady increases in retrenchments alongside the
more than 200,000 SM. It is expected that more interna- looming drastic electricity tariff hikes will dictate retail
Country Data tional developers will enter the Serbian market in 2011. The Country Data performance in 2010.
investment market is relatively immature with few available Investment yields have stayed relatively constant year over
Area (KM2) 1334.3 “products.” Though there has been no known transaction in Area (KM2) 1334.3 year, and minimal large sales/mergers/acquisitions have
2009, the expected yield for office buildings is estimated occurred this year. Financial institutions have halted funding,
GDP Growth (%) -4%
between 8-12%. GDP Growth (%) -2.17% in turn slowing the development market to a near standstill.
2010 is the year of opportunities. The boom premiums are There are still a few funds and developers who are being
GDP 2009 (US$ B) $42.39 out of the markets and not many players are able to acquire. GDP 2009 (US$ B) $277.38
very aggressive in an advantageous market, and on the
Certainly, some property owners will look to cash out and whole, transactions have occurred in-house. Hospitality is
GDP/Capita (US$) $5,742.04 sell parts of their properties, not necessarily for distressed struggling at present, although construction is currently
conditions but for decent price/value ratios. under way to cater to the World Cup Soccer 2010 tourist
influx.
Anticipated 45% annual increases in electricity tariffs
Unemployment 14.00% Unemployment 23.20% for 2010-12, could lead to thousands of retrenchments,
Rate (%) Rate (%) liquidations, and consumer debt rising dramatically. Gautrain
Interest Rate(%) 10.00% Interest Rate(%) 7.00% (Johannesburg’s rapid-rail link) will be activated in July
2010. Hosting 2010 World Cup Soccer should attract over
Population (Millions) 7.382 Population (Millions) 49.223 450 000 soccer fans to South Africa in May/June 2010.
Belgrade At A Glance Johannesburg At A Glance

Conversion: 0.793 EUR = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion: 9.8104 SAR = 1 US$ NET RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) € 14.50 € 18.00 $ 23.09 $ 28.67 N/A New Construction (AAA) SAR 2,100.00 SAR 2,100.00 $ 25.71 $ 25.71 N/A
Class A (Prime) € 14.50 € 18.00 $ 23.09 $ 28.67 29.0% Class A (Prime) SAR 360.00 SAR 924.00 $ 4.41 $ 11.31 3.9%
Class B (Secondary) € 12.50 € 16.00 $ 19.91 $ 25.48 17.0% Class B (Secondary) SAR 240.00 SAR 660.00 $ 2.94 $ 8.08 21.8%
New Construction (AAA) € 8.00 € 16.00 $ 12.74 $ 25.48 N/A New Construction (AAA) SAR 2,100.00 SAR 2,100.00 $ 25.71 $ 25.71 N/A
Class A (Prime) € 14.50 € 16.00 $ 23.09 $ 25.48 11.0% Class A (Prime) SAR 780.00 SAR 1,440.00 $ 9.55 $ 17.63 3.9%
Class B (Secondary) € 8.00 € 16.00 $ 12.74 $ 25.48 52.0% Class B (Secondary) SAR 588.00 SAR 1,140.00 $ 7.20 $ 13.96 17.0%
Bulk Warehouse € 2.00 € 7.00 $ 3.19 $ 11.15 N/A Bulk Warehouse SAR 216.00 SAR 456.00 $ 2.64 $ 5.58 3.0%
Manufacturing € 4.50 € 7.00 $ 7.17 $ 11.15 N/A Manufacturing SAR 216.00 SAR 420.00 $ 2.64 $ 5.14 3.3%
High Tech/R&D N/A N/A N/A N/A N/A High Tech/R&D SAR 336.00 SAR 600.00 $ 4.11 $ 7.35 3.7%
RETAIL RETAIL
City Center € 80.00 € 150.00 $ 127.41 $ 238.89 N/A City Center SAR 264.00 SAR 3,900.00 $ 3.23 $ 47.74 N/A
Neighborhood Service Centers € 15.00 € 60.00 $ 23.89 $ 95.56 N/A Neighborhood Service Centers SAR 1,020.00 SAR 4,200.00 $ 12.49 $ 51.42 N/A
Community Power Center (Big Box) € 7.00 € 15.00 $ 11.15 $ 23.89 N/A Community Power Center (Big Box) SAR 840.00 SAR 3,360.00 $ 10.28 $ 41.13 N/A
Regional Malls € 15.00 € 60.00 $ 23.89 $ 95.56 N/A Regional Malls SAR 2,040.00 SAR 8,400.00 $ 24.97 $ 102.83 N/A
Solus Food Stores € 10.00 € 18.00 $ 15.93 $ 28.67 N/A Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/Hectare High/Hectare Low/Hectare High/Hectare
Office in CBD € 400.00 € 1,200.00 N/A N/A Office in CBD SAR 15,000,000 SAR 20,000,000 $ 799,889.92 $ 1,066,519.90
Land in Office Parks € 200.00 € 450.00 N/A N/A Land in Office Parks SAR 17,500,000 SAR 22,500,000 $ 933,204.91 $ 1,199,834.88
Land in Industrial Parks € 30.00 € 100.00 N/A N/A Land in Industrial Parks SAR 6,500,000 SAR 9,000,000 $ 346,618.97 $ 479,933.95
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park SAR 9,000,000 SAR 12,000,000 $ 479,933.95 $ 639,911.94
Retail/Commercial Land € 50.00 € 100.00 N/A N/A Retail/Commercial Land SAR 15,000,000 SAR 20,000,000 $ 799,889.92 $ 1,066,519.90
Residential € 200.00 € 500.00 N/A N/A Residential SAR 2,500,000 SAR 6,500,000 $ 133,314.99 $ 346,618.97

Madrid, Spain Stockholm, Sweden
The International Monetary Fund expects Spanish GDP to Despite the past year’s international economic turmoil, Swe-
contract 3.8% in 2009 and 0.7% in 2010. New construction den has been doing relatively well. GDP has been decreas-
permits declined 40.1%. Unemployment could reach 20% ing but the exceptionally low rate has supported the
in 2010. Public deficit rose 5.9% of GDP. Rents have fallen, consumption and kept the prices on a stable level for the
especially in secondary locations with high vacancy. residential market. The Repo rate is now on a historically
New development is currently on hold. Prime yields are and extremely low level of 0.25%. The prime rent in the
increasing with stable demand in prime locations. Tenants Stockholm CBD has declined approximately 10% during
continue to remain very selective. Banks and savings banks the past year.
are divesting after going from €2 billion in December 2007 The vacancies for offices have not increased substantially
to €15.3 billion worth of assets due to foreclosures and debt yet but higher vacancy levels are expected. An increase in
in March 2009. sublets or second-hand lease agreements with lower rents
Only 15 of the predicted 20 to 25 shopping centers opened has been observed. No bigger office construction projects
in the retail sector (600,000 SM) as rents continued to fall. have been started during the year and the decline of rent
Rental rates are down 15% on prime space and 25% on levels is noticeable. Almost no construction of new bigger
secondary properties. Demand for well operated and oppor- retail areas has started during the last year. Slightly higher
tunistic assets is rising. vacancy rates than before have been noticed. However,
Contact Contact turnover-based rents may prevent rising vacancies.
NAI Sol The office market saw a decline of 25% in the number of NAI Svefa
deals completed compared to 2008. The average deal size Some investors fear that the retail market doesn’t need too
+ 34 91 181 1567 +46 8 441 15 50
fell to roughly 620 SM. Companies are relocating and/or much additional expansion during the upcoming years. The
taking advantage of lower rents as a cost savings measure industrial market is relatively stable and has, as the other
and many are reducing space. The prime rents in Madrid markets, experienced a very low transaction volume.
fell to €32 SM/month, about a 28% decrease from the Increasingly companies are doing sale-leasebacks in order
previous year. Landlords are offering rent free periods and to improve their balance sheets. Yields for industrial real-
more flexible lease conditions. estate have been relatively stable throughout the year. Rental
regulation for the residential market has kept rents on a
Although some industrial space is being converted to mixed relatively low level, especially in the city of Stockholm. New
use, manufacturing companies are vacating older industrial agreements between different negotiating parties have
Country Data parks in favor of more modern facilities. Logistic demand Country Data made it clear that bigger consideration of location should
remained steady. be taken into account in the Stockholm area in the future
Area (KM2) 1334.3 Area (KM2) 1334.3 regarding rent levels. Even government level changes of the
Almost 40% of transactions were sale-leasebacks with
tenant covenants being a key factor. Banco Pastor, Caixa law in this area have been taken into consideration and
GDP Growth (%) -3.77% Catalunya and BBVA’s €1.5 billion transaction, by Deutsche GDP Growth (%) -4.83% might be changed to allow more differentiated and higher
Bank are prime examples. The current economic climate top rents.
GDP 2009 (US$ B) $1,438.36 has brought a return of foreign funds and investors to the GDP 2009 (US$ B) $397.70
The transaction market has experienced higher yield levels.
market. Colonial sold its Principe Pío mall in Madrid for €125 The Swedish banks had some problems about a year ago
GDP/Capita (US$) $31,141.50 million to Dutch investor Corio. GDP/Capita (US$) $43,146.74 and the government gave credit guaranties to some of them.
Mostly it was investments in Baltic countries that caused
Inflation Rate (%) -0.29% Inflation Rate (%) 2.25% problems. Since funds are relatively accessible again, the
number of transactions has increased.
Rate (%) Rate (%)
Madrid At A Glance Stockholm At A Glance

Conversion: 0.793 EUR = 1 US$ NET RENT/M2/MO US$ RENT/SF/YR Conversion: 6.8275 SEK = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) € 22.00 € 32.00 $ 30.93 $ 44.99 5.5% New Construction (AAA) SEK 3,500.00 SEK 4,000.00 $ 47.62 $ 54.43 10.0%
Class A (Prime) € 16.00 € 24.00 $ 22.49 $ 33.74 8.0% Class A (Prime) SEK 3,700.00 SEK 4,200.00 $ 50.35 $ 57.15 7.0%
Class B (Secondary) € 14.00 € 18.00 $ 19.68 $ 25.31 15.0% Class B (Secondary) SEK 2,000.00 SEK 3,200.00 $ 27.21 $ 43.54 12.0%
New Construction (AAA) € 20.00 € 30.00 $ 28.12 $ 42.18 30.0% New Construction SEK 1,700.00 SEK 2,400.00 $ 23.13 $ 32.66 6.0%
Class A (Prime) € 8.00 € 19.00 $ 11.25 $ 26.71 15.0% Class A (Prime) SEK 1,700.00 SEK 2,300.00 $ 23.13 $ 31.30 10.0%
Class B (Secondary) € 5.00 € 10.00 $ 7.03 $ 14.06 N/A Class B (Secondary) SEK 1,100.00 SEK 1,500.00 $ 14.97 $ 20.41 15.0%
Bulk Warehouse € 4.00 € 6.00 $ 5.62 $ 8.44 N/A Bulk Warehouse SEK 800.00 SEK 1,100.00 $ 10.89 $ 14.97 6.0%
Manufacturing € 3.50 € 6.00 $ 5.62 $ 8.44 N/A Manufacturing SEK 600.00 SEK 900.00 $ 8.16 $ 12.25 9.0%
High Tech/R&D € 5.00 € 6.00 $ 7.03 $ 8.44 N/A High Tech/R&D SEK 800.00 SEK 1,150.00 $ 10.89 $ 15.65 6.0%
RETAIL RETAIL
City Center € 55.00 € 126.00 $ 77.32 $ 177.14 N/A City Center SEK 10,000.00 SEK 15,000.00 $ 136.07 $ 204.11 N/A
Neighborhood Service Centers € 10.00 € 11.00 $ 14.06 $ 15.46 N/A Neighborhood Service Centers SEK 1,700.00 SEK 2,500.00 $ 23.13 $ 34.02 N/A
Community Power Center (Big Box) € 4.00 € 5.60 $ 5.62 $ 7.87 N/A Community Power Center (Big Box) SEK 1,500.00 SEK 2,500.00 $ 20.41 $ 34.02 N/A
Regional Malls € 6.00 € 7.00 $ 8.44 $ 9.84 N/A Regional Shopping Centers/Malls SEK 1,000.00 SEK 4,000.00 $ 13.61 $ 54.43 N/A
Solus Food Stores € 8.00 € 10.00 $ 14.06 $ 19.68 N/A Solus Food Stores SEK 1,000.00 SEK 1,800.00 $ 13.61 $ 24.49 N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/ M2 High/M2 Low/SF High/SF
Office in CBD € 700.00 € 1,050.00 $ 82.01 $ 123.01 Office in CBD SEK 8,000.00 SEK 13,000.00 $ 1,171.73 $ 1,904.06
Land in Office Parks € 210.00 € 630.00 $ 24.60 $ 73.81 Land in Office Parks SEK 1,500.00 SEK 2,900.00 $ 219.70 $ 424.75
Land in Industrial Parks € 525.00 € 210.00 $ 61.51 $ 24.60 Land in Industrial Parks SEK 650.00 SEK 1,300.00 $ 95.20 $ 190.41
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park SEK 500.00 SEK 950.00 $ 73.23 $ 139.14
Retail/Commercial Land € 175.00 € 630.00 $ 20.50 $ 73.81 Retail/Commercial Land SEK 1,300.00 SEK 2,300.00 $ 190.41 $ 336.87
Residential € 525.00 € 2,275.00 $ 61.51 $ 266.52 Residential SEK 2,500.00 SEK 4,000.00 $ 366.17 $ 585.87

Geneva, Switzerland Zürich, Switzerland
The Geneva area has weathered the economic storm relatively The Greater Zürich Area (GZA) is known for the financial,
well within the traditional sectors of finance and bio-pharma, insurance and industrial sectors together with growing IT,
although a greater impact has been apparent within the pharma and life-science industries. A gradual slowdown was
watch making industry. Inflation has revolved around zero noted in the economy in the first two quarters of 2009, how-
since March 2009 and at the time of publication the average ever since June a positive change has been noted. Projected
inflation rate for 2009 is -0.5%. Unemployment rose during GDP figures for 2009 are estimated at -1.7% year over year.
2009 to 3.9%, which remains low in European terms, Compared with the GDP fall to -4.6% in the Eurozone,
though Geneva has suffered more than other zones in this Switzerland appears fairly stable.
respect. Despite weak demand, office projects have proceeded in the
The office market has seen strong take-up in the CBD and financial, insurance and IT sectors as they benefit from
airport areas. Waterfront premises remain in short supply realignment within the Zürich marketplace. Google, Microsoft
with tenants prepared to drive up rental values. and Red Herring have all announced new expansion plans.
The interest of hedge funds has been sustained throughout Other players include Draper Investment, Meltwater News and
2009. Combined with the effect of the “winners and losers” Diamond Systems. Allianz has announced the re-grouping of
among the private banks and financial sector in general, the its organization to Wallisellen (ZH) and New Reinsurance has
Geneva area will see a rise in occupation by April 2010, as relocated from Geneva to Zürich. ACM has also opened a
Contact Contact new branch along Bahnhofstrasse.
the financial players seek to position themselves.
NAI Commercial CRE NAI Commercial CRE
Prime rents remained buoyant in 2009, with waterfront Zürich prime rents peaked in Q1, having reached a level
+ 41 22 707 44 44 + 41 44 221 04 04
properties renting for around CHF 1,000/SM per year and between CHF 850-900/SM per year. The industrial sector
well above for exceptional properties. The industrial market has been stagnant, with many decisions being postponed
has been more subdued throughout 2009 with many proj- or cancelled. Rents remain stable, though take-up is slow.
ects put on hold or postponed. Despite this, developments Foreign investment interest remains strong, although major
have seen take-up from certain sectors such as bio-pharma, Swiss funds rapidly acquire suitable prime properties, which
micro-technology and life science sectors. Rents remain at are in short supply. Owner-occupation remains stable, with
CHF 120-150/SM per year for production areas and CHF the majority of the activity in the pharmaceutical, biotech,
200-360/SM per year for high tech office space. life science or financial sectors. The volume of sales remains
Country Data The investment market for landmark buildings has remained Country Data low; however, prime yields have barely softened with net
strong with prime properties still commanding net yields yields continuing to perform at sub -4% for prime locations.
Area (KM2) 1334.3 between 3.25-3.85% as demand outstrips supply. The sec- Area (KM2) 1334.3 Bahnhofstrasse added the new Apple store to its world
ondary areas have seen a softening of yields and a reduction brand, however with the exception of a few newcomers the
GDP Growth (%) -1.95% in the volume of sales. GDP Growth (%) -1.95% retail sector has suffered from the sluggish economy. Rents
The retail market has been under pressure since September, are in the order of CHF 3,500-3,800/SM per year, though
GDP 2009 (US$ B) $484.13 suffering from an over-heated market during 2008 coupled GDP 2009 (US$ B) $484.13
some deals have resulted in achieved rents in excess of CHF
with the world economic downturn. Although still relatively 7,500/SM per year.
GDP/Capita (US$) $66,126.80 scarce, marketed units are reverting in line with sustainable GDP/Capita (US$) $66,126.80 Numerous commercial projects on the outskirts of the CBD
market values. may prevent stagnation at a later date. However, quality
Inflation Rate (%) -0.40% In general, prospects appear good for Geneva, which has Inflation Rate (%) -0.40% office accommodations with large floor plans have already
suffered less than many European neighbors, benefiting secured occupants, notably in the WestPark Areal and Ernst
Unemployment 3.48% from its traditional “safe-haven” effect. While prime down- Unemployment 3.48% & Young set to occupy the Platform area of the Prime Tower
Rate (%) Rate (%) development.
town areas will remain stable, a number of developments
Interest Rate(%) 0.25% on the outskirts of Geneva and around the airport may find Interest Rate(%) 0.25%
take-up slow in 2010.
Geneva At A Glance Zürich At A Glance

Conversion: 1.2237 CHF = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion: 1.00746 CHF = 1 US$ RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) CHF 900.00 CHF 1,200.00 $ 82.99 $ 110.66 1.0% New Construction (AAA) CHF 800.00 CHF 1,000.00 $ 73.77 $ 92.21 1.0%
Class A (Prime) CHF 850.00 CHF 1,000.00 $ 78.38 $ 92.21 1.0% Class A (Prime) CHF 750.00 CHF 900.00 $ 69.16 $ 82.99 1.5%
Class B (Secondary) CHF 550.00 CHF 800.00 $ 50.72 $ 73.77 5.0% Class B (Secondary) CHF 450.00 CHF 650.00 $ 41.50 $ 59.94 4.5%
New Construction (AAA) CHF 450.00 CHF 600.00 $ 41.50 $ 55.33 2.5% New Construction (AAA) CHF 450.00 CHF 550.00 $ 41.50 $ 50.72 4.0%
Class A (Prime) CHF 450.00 CHF 550.00 $ 41.50 $ 50.72 3.5% Class A (Prime) CHF 300.00 CHF 450.00 $ 27.66 $ 41.50 4.5%
Class B (Secondary) CHF 300.00 CHF 450.00 $ 27.66 $ 41.50 5.0% Class B (Secondary) CHF 300.00 CHF 450.00 $ 27.66 $ 41.50 6.0%
Bulk Warehouse CHF 70.00 CHF 90.00 $ 6.46 $ 8.30 1.0% Bulk Warehouse CHF 70.00 CHF 90.00 $ 6.46 $ 8.30 1.0%
Manufacturing CHF 90.00 CHF 150.00 $ 8.30 $ 13.83 1.0% Manufacturing CHF 80.00 CHF 150.00 $ 7.38 $ 13.83 1.0%
High Tech/R&D CHF 250.00 CHF 360.00 $ 23.05 $ 33.20 2.0% High Tech/R&D CHF 200.00 CHF 380.00 $ 18.44 $ 35.04 2.5%
RETAIL RETAIL
City Center CHF 3,250.00 CHF 4,500.00 $ 299.70 $ 414.96 1.0% City Center CHF 3,500.00 CHF 5,000.00 $ 322.75 $ 461.07 1.0%
Neighborhood Service Centers CHF 450.00 CHF 500.00 $ 41.50 $ 46.11 4.0% Neighborhood Service Centers CHF 450.00 CHF 500.00 $ 41.50 $ 46.11 4.0%
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 $ 32.28 $ 55.33 1.5% Regional Shopping Centers/Malls CHF 450.00 CHF 800.00 $ 41.50 $ 73.77 2.0%
Office in CBD CHF 30,000 CHF 40,000 $ 2,766.43 $ 3,688.57 Office in CBD CHF 30,000 CHF 40,000 $ 2,766.43 $ 3,688.57
Land in Office Parks CHF 700 CHF 900 $ 64.55 $ 82.99 Land in Office Parks CHF 700 CHF 900 $ 64.55 $ 82.99
Land in Industrial Parks CHF 200 CHF 300 $ 18.44 $ 27.66 Land in Industrial Parks CHF 250 CHF 350 $ 23.05 $ 32.28
Office/Industrial Land - Non-park CHF 250 CHF 400 $ 23.05 $ 36.89 Office/Industrial Land - Non-park CHF 250 CHF 650 $ 23.05 $ 59.94
Retail/Commercial Land CHF 1,000 CHF 1,500 $ 92.21 $ 138.32 Retail/Commercial Land CHF 1,000 CHF 1,600 $ 92.21 $ 147.54

Istanbul, Turkey Kiev, Ukraine
Turkey’s economy shows the impact of the global recession In Q2 of 2009 Ukraine’s real GDP dropped 17.8 %. However
in 2009. The inflation rate reached 5.39% in May, which is the speed of decline has decreased. The construction sector
slightly higher than the lowest level of 5.24% in the past 39 has decreased more than others (-47%). Its part of GDP
years. Turkey’s currency has depreciated 20% compared to structure makes up 2.8%. Agriculture is the only sector that
the first half of 2008. Construction activity declined 7.6%in demonstrated growth (+2.3%). The processing industry,
2009, and the steel industry declined about 15%. Turkey’s which is the basis of country’s GDP, had fallen 33% through
major export manufacturing sectors such as textile and Q2 2009.
automotive have also been impacted negatively. Demand for professional office space has decreased consid-
Occupancy rates in CBD routes like Levent and Zincirlikuyu erably. In Kiev, the vacancy rate is about 15%. The fall in rental
are still high, while Umraniye and Kozyatagi in the Asian Part rates from their 2008 peak is roughly 60%. Prime rents are
of Istanbul kept their popularity to become new districts for now about US $30-35/SM/month. Despite the decline, new
offices. One of the biggest office projects is the 90,000 SM office buildings continue to be commissioned in Kiev. During
Akkom office project, which will be built by Eroglu Holding the first half of 2009 three new centers were commissioned,
in Umraniye. In addition, Emaar Properties has purchased accounting for 20,500 SM growth.
a 74,000 SM land parcel in the Asian Side of Istanbul for From the beginning of 2009, prime rents for modern ware-
approximately $400 million from Toprak Holding. There will house facilities within a 30km zone from Kiev dropped by
Contact be residence blocks as well as a 120,000 SM shopping Contact
30% to US $6.00-$7.00/SM/month excluding operating
NAI Treas center, a five-star hotel and office buildings. NAI Pickard
expenses. Vacancy rates are currently 35%-40%. Most ware-
+90 216 481 47 00 +380 44 278 00 02
The retail market, which registered fast growth in recent housing developments are now on hold and their delivery is
years, showed signs of slowing in the first nine months of rescheduled to 2010-2011. Only 70,000-80,000 SM is likely
2009. By September 2009, retail supply had reached 6.06 to be delivered onto the market by the end of 2009.
million SM in 276 retail centers. Istanbul accounts for 2.2 The occupancy rate for shopping centers in Kiev has
million SM of this total in 88 shopping centers. There decreased but it is still rather high; only about 3.5% of total
are 135 shopping centers under construction and in the retail spaces are vacant. Yet a decrease of consumer de-
planning stage in Turkey, of which 67 are in Istanbul. There mand and devaluation of the Hrivna led to a substantial de-
has been an increase in the number of warehouses due cline in rental rates, dropping 60% since 2008. The average
to increased demand for industrial real estate in Turkey. rental rates today are about US $45-50/SM/month. Growth
Country Data Logiturk B2B Real Estate Solutions Company is planning Country Data
of retail space in shopping centers in the first half of 2009
to complete a 126,000 SM warehouse park in Istanbul. is at 14.3% (66,900 SM).
Area (KM2) 1334.3 Area (KM2) 1334.3
Total international direct investment in 2008 reached Ukraine is still desperately short of hotels especially in the
$17.96 billion in Turkey, where $2.94 billion of this amount genuine three-star category. The authorities are offering to
was invested in real estate. The amount of international fast track approvals but money remains tight.
direct investment in July 2009 totaled $4.938 billion, down
GDP 2009 (US$ B) $593.53 significantly from $9.735 billion in July 2008. GDP 2009 (US$ B) $115.71 FDI is virtually non-existent this year and will probably
remain flat until after the presidential elections slated for
GDP/Capita (US$) $8,427.11 GDP/Capita (US$) $2,537.80 January 2010. However sales on yields of 20% on current
low rental levels are possible. The opportunity for rental
Inflation Rate (%) 6.20% Inflation Rate (%) 16.28% growth and consequent capital growth is still strong.

Rate (%) Rate (%)
Istanbul At A Glance Kiev At A Glance

Conversion: 1.49 = 1 US$ RENT/M2/YR US$ RENT/SF/YR Conversion: 7,64 UAH = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) $ 204.00 $ 360.00 $ 18.95 $ 33.44 N/A New Construction N/A N/A N/A N/A N/A
Class A (Prime) $ 126.00 $ 306.00 $ 11.71 $ 28.43 15.0% Class A (Prime) UAH 360.00 UAH 420.00 $ 52.53 $ 61.29 17.0%
Class B (Secondary) $ 108.00 $ 138.00 $ 10.03 $ 12.82 N/A Class B (Secondary) UAH 216.00 UAH 264.00 $ 31.52 $ 38.52 14.0%
New Construction (AAA) $ 114.00 $ 138.00 $ 10.59 $ 12.82 N/A New Construction N/A N/A N/A N/A N/A
Class A (Prime) $ 78.00 $ 120.00 $ 7.25 $ 11.15 20.0% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) $ 54.00 $ 120.00 $ 5.02 $ 11.15 N/A Class B (Secondary) N/A N/A N/A N/A N/A
Bulk Warehouse $ 48.00 $ 84.00 $ 4.46 $ 7.80 N/A Bulk Warehouse UAH 70.00 UAH 85.00 $ 10.21 $ 12.40 35.0%
Manufacturing $ 48.00 $ 72.00 $ 4.46 $ 6.69 N/A Manufacturing N/A N/A N/A N/A N/A
High Tech/R&D $ 72.00 $ 96.00 $ 6.69 $ 8.92 N/A High Tech/R&D N/A N/A N/A N/A N/A
RETAIL RETAIL
City Center $ 432.00 $ 1,560.00 $ 40.13 $ 144.93 20.0% City Center UAH 490.00 UAH 720.00 $ 71.50 $ 105.06 6.2%
Neighborhood Service Centers $ 264.00 $ 768.00 $ 24.53 $ 71.35 N/A Neighborhood Service Centers UAH 360.00 UAH 600.00 $ 52.53 $ 87.55 N/A
Community Power Center (Big Box) $ 216.00 $ 576.00 $ 20.07 $ 53.51 N/A Community Power Center (Big Box) UAH 480.00 UAH 660.00 $ 70.04 $ 96.31 2.0%
Regional Shopping Centers/Malls $ 216.00 $ 768.00 $ 20.07 $ 71.35 18.0% Regional Shopping Centers/Malls UAH 480.00 UAH 720.00 $ 70.04 $ 96.31 2.0%
Solus Food Stores $ 162.00 $ 240.00 $ 15.05 $ 22.30 N/A Solus Food Stores N/A N/A N/A N/A N/A
Office in CBD $ 850.00 $ 4,015.00 $ 78.97 $ 373.00 Office in CBD N/A N/A N/A N/A
Land in Industrial Parks $ 265.00 $ 825.00 $ 24.62 $ 76.64 Land in Industrial Parks N/A N/A N/A N/A
Office/Industrial Land - Non-park $ 210.00 $ 1,950.00 $ 19.51 $ 181.16 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land $ 425.00 $ 3,010.00 $ 39.48 $ 279.64 Retail/Commercial Land N/A N/A N/A N/A
Residential $ 45.00 $ 3,010.00 $ 4.18 $ 279.64 Residential N/A N/A N/A N/A

London, United Kingdom
The UK economy is currently (Q2) contracting at 5.5%. With
GDP expected to return to growth in the fourth quarter, the
current forecast for 2009 is -4.40%. Economists are fore-
casting GDP growth of 1.40% for 2010. The UK Base rate
is 0.5%, credit remains tight, monetary stimulus has been
extended and Sterling is relatively weak. In line with GDP
forecasts, there is the perception that the real estate
markets are at or close to bottom.
Office rents have fallen 40% to 50% from the peak. Incentives
of two or three years rent free are common on 10-year
leases in the West End and City, respectively. Development
activity is declining. Leasing activity remains low. Unsurpris-
ingly, warehouse rents have been falling (3.2% in the year to
June 2009) and the availability of large buildings in
excess of 10,000 SM increased by about 15%. Development
activity has slowed dramatically.
Contact
Retail sales were up 2.4% year over year through September.
NAI Global
Non-food retail figures were flat at around 1.1% annual
+1 609 945 4000
growth while food store volumes grew at 2.8%. Central
London rental values have fallen 5.9% in the last 12 months
but some key central London streets have bucked the trend,
boosted by tourism and the weak Pound. For example, Bond
Street still commands rents of £750/SF Zone A. Leasing
incentives are increasing. Development activity has virtually
stopped.
Investment activity is improving with £1.98 billion invested
Country Data in the City and West End in the first half of the year. Yields
are hardening. Overseas investors have been attracted by
Area (KM2) 244,100
the weak pound, the length of UK leases (10-15 years),
upward-only rent reviews, historically high yields and
the perception that the prime property market is close to
GDP Growth (%) 1.0
bottom. Some UK funds have recently started to re-enter
the market.
GDP 2008 (US$ B) 2,787.37
While the UK economy remains difficult and the emergence
GDP/Capita (US$) 45,681.00
from recession is slower than economists were forecasting,
the rate of rental decline in the different sectors is slowing
and there are clear signs of a recovery in the investment
Inflation Rate (%) 3.8
market.
Unemployment 5.4
Rate (%)
London At A Glance
Conversion: 0.6162 £ = 1 US$ RENT/M2/YR RENT/SF/YR
Low High Low High Vacancy
OFFICE WEST END 6.7%
Mayfair £ 700.00 £ 800.00 $ 105.54 $ 120.61 N/A
Victoria £ 500.00 £ 565.00 $ 75.38 $ 85.18 N/A
OFFICE CITY 8.5%
Core £ 400.00 £ 450.00 $ 60.31 $ 67.84 N/A
Fringe £ 300.00 £ 350.00 $ 45.23 $ 52.77 N/A
Mid-town £ 400.00 £ 450.00 $ 60.31 $ 67.84 N/A
INDUSTRIAL SPACE
South East (excluding Heathrow) £ 85.00 £ 120.00 $ 12.82 $ 18.09 N/A
Heathrow £ 130.00 £ 140.00 $ 19.60 $ 21.11 N/A
RETAIL SPACE (ZONE A)
Brompton Road N/A £ 5,167.00 N/A $ 779.01 N/A
Canary Wharf N/A £ 3,606.00 N/A $ 543.66 N/A
City N/A £ 2,153.00 N/A $ 324.60 N/A
Convent Garden N/A £ 5,920.00 N/A $ 892.54 N/A
Oxford Street N/A £ 5,813.00 N/A $ 876.41 N/A
New Bond Street N/A £ 8,234.00 N/A $ 1,241.41 N/A
Marylebone High Street N/A £ 2,153.00 N/A $ 324.60 N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF
Office in CBD N/A N/A N/A N/A
Land in Industrial Parks 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

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
San Jose, Costa Rica
Kingston, Jamaica
Ciudad Juarez, Mexico
Guadalajara, Mexico
Guanajuato, Mexico
Matamoros, Tamaulipas, Mexico
Mexicali, Baja California, Mexico
Mexico City, Mexico
Monterrey, Nuevo Leon, Mexico
Querétaro, Mexico
Reynosa, Mexico
Saltillo, Mexico
San Luis Potosí (SLP), Mexico
Tijuana, Baja California, Mexico
Torreon, Mexico
Caracas, Venezuela
Buenos Aires, Argentina Nassau, The Bahamas
The Argentine economy is expected to shrink 2% in 2009 The Bahamas is known worldwide as a great destination for
as the agricultural and commodities sectors suffer from travelers and, with over 5 million tourists per year, the
lower global prices and local draught, as well as lower hospitality sector is growing. The Bahamas Government
investments due to internal political conflicts. In 2010 the along with the Bahamas Financial Services Board is looking
economy is expected to bounce back and grow 2% to at creating a commercial court system to resolve commercial
3% based on the country’s relative competitive advantage matters quickly and efficiently. It is hoped that a well func-
in sectors like agribusiness, back office services and tioning judiciary would create confidence and attract more
specialized manufacturing. international investors.
Lower demand in the office market sector has caused The CBD Class A and B office market is slow as more
lease prices to fall 10%-15% in Class A office space in companies are willing to move out of the core. In suburban
the Buenos Aires CBD, to an average of US $28- areas the demand for office space is quite high but the
$32/SM/month. Vacancy rates jumped from 3% to 9%. The availability of space is restricted due to land availability and
drop in value in Class B space and suburban offices has cost. Offshore banking is still a mainstay of the economy
been approximately 20% in 2009 with transactions ranging and there have been some large mergers in 2009. The
in the US $15-$20/SM range as corporations emphasize demand is still high for land in suburban areas as land and
cost savings. Accenture, for example, took 8,000 SM in a development costs in these areas are still reasonable.
Contact refurbished Class B building paying approximately US Contact
The Airport Industrial Park is growing as businesses move
NAI Castro Cranwell $16/SM. Symantex and PepsiCo moved to suburban office NAI Lowes Realty
there from the more congested and costly areas. This activity
& Weiss S.A. buildings at US $18/SM. Premium industrial parks and +1 242 322 1741
is mostly warehouse and back offices. The retail market is
+54 11 5031 1600 logistics facilities maintained their values and the vacancy still growing; with more residential developments in the
level is still in the low single digits as this segment in western district of New Providence there is a need for more
Argentina continues to be under serviced and as demand retail centers.
continues to increase with the overall economy.
The downtown core has seen a downturn recently due to a
In the other market segments, warehouse space vacancy lack of cleanliness and safety. One of the major problems in
has increased slightly and values have become marginally this area is the lack of parking and this impacts greatly the
softer. Top retail lease values have softened in this market amount of local traffic. Investment sales have slowed in the
during 2009, both in high street space and in shopping second home market but there has been more interest by
Country Data centers. Nevertheless, the retail market continues to be Country Data
investors looking at either hospitality or office complexes as
Area 2,766,890 under serviced as is evidenced by the inauguration of IRSA’s an investment. The Bahamar project on Cable Beach has
DOT Shopping Center with full occupancy of its 140 stores. Area 13,940
drawn the interest of the Chinese and they have started
GDP Growth (%) -2.5% Capitalization rates have increased in 2009 and are generally investing quite heavily in the Bahamas.
in the 12%-14% range although there continues to be a GDP Growth (%) -3.9%
GDP 2008 (US$ B) $301.33 lack of sellers, particularly of premium properties. The outlook for 2010 is a slow start in Q1 but increased
GDP 2008 (US$ B) $7.40
activity in the latter part of the year as the Bahamar devel-
Overall, the real estate market has entered into a down cycle opment on Cable Beach should be progressing and other
GDP/Capita (USD) $7,508.05 in 2009 with lower demand causing vacancies to increase planned projects will be getting off the ground.
5%-10% and prices to soften 10%-25%. GDP/Capita (USD) $21,727.86
Inflation Rate (%) 5.58%
Unemployment 8.8%
Rate (%) Unemployment 14.2%
Rate (%)
Buenos Aires At A Glance Nassau At A Glance

RENT/M2/Mo US$ RENT/SF/YR RENT/SF/YR
Low High Low High Vacancy Low High Vacancy
New Construction (AAA) $ 30.00 $ 35.00 $ 0.73 $ 0.86 0.5% New Construction (AAA) N/A N/A N/A
Class A (Prime) $ 24.00 $ 32.00 $ 0.59 $ 0.78 8.0% Class A (Prime) $ 25.00 $ 33.00 10.2%
Class B (Secondary) $ 12.00 $ 20.00 $ 0.29 $ 0.49 12.0% Class B (Secondary) $ 18.00 $ 25.00 15.7%
New Construction (AAA) $ 18.00 $ 22.00 $ 0.44 $ 0.54 2.0% New Construction (AAA) N/A N/A N/A
Class A (Prime) $ 15.00 $ 20.00 $ 0.37 $ 0.49 2.0% Class A (Prime) $ 25.00 $ 35.00 N/A
Class B (Secondary) $ 10.00 $ 12.00 $ 0.24 $ 0.29 2.0% Class B (Secondary) $ 12.00 $ 18.00 N/A
Bulk Warehouse $ 3.50 $ 6.00 $ 0.09 $ 0.15 N/A Bulk Warehouse $ 10.00 $ 20.00 N/A
Manufacturing $ 3.50 $ 5.50 $ 0.09 $ 0.13 N/A Manufacturing N/A N/A N/A
High Tech/R&D $ 5.00 $ 8.00 $ 0.12 $ 0.20 N/A High Tech/R&D N/A N/A N/A
RETAIL RETAIL
Downtown $ 35.00 $ 70.00 $ 0.86 $ 1.71 5.0% Downtown $ 45.00 $ 95.00 8.0%
Neighborhood Service Centers $ 15.00 $ 20.00 $ 0.37 $ 0.49 15.0% Neighborhood Service Centers 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 N/A
Regional Malls $ 18.00 $ 50.00 $ 0.44 $ 1.22 10.0% Regional Malls $ 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
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/Acres High/Acres Low/SF
Office in CBD $ 400.00 $ 1.00 $ 0.01 $ 0.00 Office in CBD N/A N/A N/A
Land in Office Parks N/A N/A N/A N/A Land in Office Parks N/A N/A N/A
Land in Industrial Parks $ 30.00 $ 60.00 $ 0.00 $ 0.00 Land in Industrial Parks N/A N/A N/A
Office/Industrial Land - Non-park $ 5.00 $ 70.00 $ 0.00 $ 0.00 Office/Industrial Land - Non-park $ 10.00 $ 18.00 0.02
Retail/Commercial Land $ 200.00 $ 1.00 $ 0.01 $ 0.00 Retail/Commercial Land $ 18.00 $ 25.00 0.0
Residential $ 400.00 $ 1,000.00 $ 0.01 $ 0.03 Residential $ 10.00 $ 50.00 0.0

Campinas, Brazil Curitiba, Brazil
Campinas is located in the state of São Paulo, about 90km Curitiba is the capital of Paraná, located in the southern part
from the capital of the same name – São Paulo. Campinas of Brazil. The city occupies 435 square kilometers and has
occupies an area of 796 km² and has a population of a population of almost 1.8 million inhabitants. For many, this
1.064.664 inhabitants. Eleventh richest city of Brazil and city has the best quality of life in the country. It is the seventh
third most populous city of the country, Campinas is part of most populous city of Brazil and the largest of the southern
the Metropolitan Complex Extended of São Paulo. As such, region. The city’s initial and famous diverse town planning
it is an important logistics hub for the area. and legislation that aimed to contain its growth has started
The Campinas market comprises approximately one-third to lose control.
of the industrial output of the state of São Paulo, including Curitiba is the fifth largest city in Brazil and one of the best
high technology and metallurgy. The region is home to more cities for investments in Latin America. It has important
than 10,000 companies, including prominent global names companies in the sectors of commerce, service and financial.
such as: Honda, Toyota, Unilever, 3M of Brazil, Sherwin- It has a 43 million SM industrial park, the second-largest
Williams, Bosch, Pirelli, Dell, IBM, BASF, Dow Chemical, automotive center for the country and the Alfonso Pena
Ericsson, Singer, Goodyear, Valero, International Paper, Nor- International Airport. The rate of companies moving into the
tel, Lucent, Samsung, Motorola, AmBev, Caterpillar, Bom- market has increased so land and property values are
bardier and many others. The petrochemical complex is increasing and the supply rate is falling. The vacancy rate for
Contact centered in Paulínia, about 13 kilometers from Campinas, Contact Class A office space remained low at less than 6%. The
NAI Commercial next to the Petrobrás Refinery of the Plateau (REPLAN). This NAI Commercial average rental rates for office space in the city of Curitiba also
Properties Brazil complex is the largest in Brazil and one of the largest in all Properties Brazil are low compared to other cities, about 15% to 20% lower.
+1 55 11 5506 5655 of Latin America, and hosts companies such DuPont, +55 11 5506 5655
Single-purpose industrial condominiums, built primarily for
Chevron, Shell, Exxon, Rhodia and others. The Campinas certain sectors’ needs, characterize the industrial property
airport claims the largest volume of import/export shipments market in Curitiba. During 2009, the industrial sector stabi-
for the country. lized and is now considered one of the city’s best property
Campinas is also an important and diversified commercial investments. In the retail sector, the most important
center, and home to two of the largest shopping malls in the submarket is Ahú, now that the Ahú Prison has been
country—The Shopping Iguatemi of Campinas and the mall shuttered and its tenants relocated to other areas. The Anita
Park D. Pedro—and the International Airport Viracopos, Garibaldi submarket has undergone one of Brazil’s biggest
Country Data which is involved in the international transport of shipments. Country Data urban changes in recent years; many older structures are
The city of Campinas should attract more investors in 2010 now being redeveloped for commercial uses.
Area 8,511,965 due to fiscal incentives put in place. The town has healthy Area 8,511,965
vacancy and growth potential to more than the double its
GDP Growth (%) -0.66% present market size. GDP Growth (%) -0.66%
The economy showed signs of recovery. Presidential elections

GDP 2008 (US$ B) $1,481.55 in 2010, the World Cup of soccer in 2014 and the selection GDP 2008 (US$ B) $1,481.55
of Brazil to host the 2016 Olympic Games should attract
GDP/Capita (USD) $7,737.32 additional investment that will support overall economic GDP/Capita (USD) 4.85%
stability in the country.

Rate (%) Rate (%)
Campinas At A Glance Curitiba At A Glance

Conversion 1.72 BRL = 1 US$ RENT/M2/MO US$ NET RENT/SF/YR Conversion: 1.72 BRL = 1 US$ RENT/M2/MO US$ RENT/SF/YR
New Construction (AAA) BRL 35.00 BRL 50.00 $ 22.69 $ 32.41 5.5% New Construction (AAA) BRL 15.00 BRL 23.00 $ 9.72 $ 14.91 5.0%
Class A (Prime) BRL 25.00 BRL 30.00 $ 16.20 $ 19.44 6.0% Class A (Prime) BRL 9.00 BRL 15.00 $ 5.83 $ 9.72 5.5%
Class B (Secondary) BRL 15.00 BRL 20.00 $ 9.72 $ 12.96 6.5% Class B (Secondary) BRL 7.00 BRL 10.00 $ 4.54 $ 6.48 6.0%
New Construction (AAA) BRL 9.00 BRL 15.00 $ 5.83 $ 9.72 5.5% New Construction (AAA) BRL 11.00 BRL 18.00 $ 7.13 $ 11.67 5.0%
Class A (Prime) BRL 9.00 BRL 14.00 $ 5.83 $ 9.07 6.5% Class A (Prime) BRL 10.00 BRL 13.00 $ 6.48 $ 8.43 4.5%
Class B (Secondary) BRL 9.00 BRL 16.00 $ 5.83 $ 10.37 6.5% Class B (Secondary) BRL 9.00 BRL 10.00 $ 5.83 $ 6.48 5.0%
Bulk Warehouse BRL 10.00 BRL 16.00 $ 6.48 $ 10.37 4.0% Bulk Warehouse BRL 10.00 BRL 16.00 $ 6.48 $ 10.37 4.5%
Manufacturing BRL 3.00 BRL 10.00 $ 1.94 $ 6.48 5.0% Manufacturing BRL 3.00 BRL 10.00 $ 1.94 $ 6.48 4.5%
High Tech/R&D BRL 6.00 BRL 12.00 $ 3.89 $ 7.78 6.0% High Tech/R&D BRL 6.00 BRL 12.00 $ 3.89 $ 7.78 5.0%
RETAIL RETAIL
Downtown BRL 16.00 BRL 40.00 $ 10.37 $ 25.93 6.0% Downtown BRL 10.00 BRL 18.00 $ 6.48 $ 11.67 4.5%
Neighborhood Service Centers BRL 18.00 BRL 30.00 $ 11.67 $ 19.44 5.1% Neighborhood Service Centers BRL 6.00 BRL 11.00 $ 3.89 $ 7.13 5.0%
Community Power Center BRL 22.00 BRL 32.00 $ 14.26 $ 20.74 5.0% Community Power Center BRL 7.00 BRL 11.00 $ 4.54 $ 7.13 4.5%
Regional Malls BRL 35.00 BRL 50.00 $ 22.69 $ 32.41 5.0% Regional Malls BRL 10.00 BRL 14.00 $ 6.48 $ 9.07 3.0%
Solus Food Stores BRL 22.00 BRL 30.00 $ 14.26 $ 19.44 4.2% BRL 9.00 BRL 11.00 $ 5.83 $ 7.13 3.0%

Porto Alegre, Brazil Rio de Janeiro, Brazil
Porto Alegre occupies 497 square kilometers and is located The second largest economy of Brazil, Rio de Janeiro occu-
in the extreme south of Brazil. Porto Alegre is the capital of pies an area of 1,182 km², has a population of 6,093,472 in-
RIo Grande do Sul state and it is in the Southern Region of habitants and is located in the Southeast part of the country.
the country. With a population of 1.4 million inhabitants, it Its industrial areas are utilized primarily by chemical,
has the highest per capita density and is the fourth most pharmaceuticals, steel, metallurgy, petroleum, processed
populous city in Brazil. foods, printing and publishing industries. Rio’s main eco-
The economy of the city is primarily based on the service nomic source is tourism—40% of the foreigners that visit
sector, followed by industrial and farming. The high output Brazil choose Rio de Janeiro as their destination—followed
of fruits and vegetables makes Porto Alegre the largest rural by the services sector and the oil industry.
zone between the Brazilian capitals. It will be one of the 12 The cautious approach that most companies, builders and
headquarters cities for the soccer World Cup in 2014. It will developers had has now been replaced with optimism. Many
also be a host city for the 2016 Olympic Games; these two companies are now looking to expand, and investors have
factors should bring significant infrastructure investment, returned to inject capital into the economy. In the office
including improvements in the infrastructure such as new market, the high-end product did not suffer from the global
streets and an expansion of the subway. This should provide economic malaise, primarily due to the low vacancies that
an impulse to the local economy and increase the activity in already existed. The class-A building towers completed
Contact the property market. Contact during the last few months are, by all accounts, leasing well.
NAI Commercial NAI Commercial In Barra da Tijuca, the newest and most desirable area, the
Several major commercial developments are also under
Properties Brazil Properties Brazil activity is even higher due to the completion of numerous
way. The developer, Rossi, is going to invest R $500 million
+1 55 11 5506 5655 +1 55 11 5506 5655 buildings and the expected completion of several more.
in the construction of a condominium and commercial com-
plex that will form a neighborhood planned in the eastern Rental rates have remained stable, also as a consequence of
portion of the city. Another major construction project, Center the low vacancy. The rental of retail space in Rio de Janeiro
Home Mall, will have more than 60,000 SM of buildings. is very active due to the strong presence of corporate users
Located in the Av. Sertório and Assis Brazil, this development and the city’s diverse tourist areas that attract foreigners
solidifies the region as a business and commercial hub. and Brazilians. The Southeast area of Brazil is the most
Upon completion it will have 120 shops, a food plaza, important region for industrial operations. The Rio de Janeiro
service operations and parking for 1,200 cars. Beyond the industrial inventory and average pricing remained relatively
Country Data jobs it generates, it also brings significant improvement to Country Data stable during 2009.
the infrastructure in the region. Rio de Janeiro is expected to get a major economic boost
Area 8,511,965 Area 8,511,965
from infrastructure improvements and investments resulting
from its selection as the host city for the 2016 Summer
Olympics.
GDP 2008 (US$ B) $1,481.55 GDP 2008 (US$ B) $1,481.55

Rate (%) Rate (%)
Porto Alegre At A Glance Rio de Janeiro At A Glance

Conversion 1.72 BRL = 1 US$ RENT/M2/MO US$ NET RENT/SF/YR Conversion1.72 BRL = 1 US$ RENT/M2/MO US$ NET RENT/SF/YR
New Construction (AAA) BRL 13.00 BRL 20.00 $ 8.43 $ 12.96 4.5% New Construction (AAA) BRL $ 80.00 BRL $ 150.00 $ 51.85 $ 97.22 1.0%
Class A (Prime) BRL 16.00 BRL 18.00 $ 10.37 $ 11.67 5.0% Class A (Prime) BRL $ 70.00 BRL $ 140.00 $ 45.37 $ 90.74 1.4%
Class B (Secondary) BRL 7.00 BRL 14.00 $ 4.54 $ 9.07 5.0% Class B (Secondary) BRL $ 60.00 BRL $ 100.00 $ 38.89 $ 64.82 1.9%
New Construction (AAA) BRL 12.00 BRL 18.00 $ 7.78 $ 11.67 5.5% New Construction (AAA) BRL $ 80.00 BRL $ 140.00 $ 51.85 $ 90.74 1.0%
Class A (Prime) BRL 10.00 BRL 16.00 $ 6.48 $ 10.37 4.0% Class A (Prime) BRL $ 70.00 BRL $ 140.00 $ 45.37 $ 90.74 5.5%
Class B (Secondary) BRL 7.00 BRL 12.00 $ 4.54 $ 7.78 5.0% Class B (Secondary) BRL $ 60.00 BRL $ 100.00 $ 38.89 $ 64.82 9.7%
Bulk Warehouse BRL 9.00 BRL 15.00 $ 5.83 $ 9.72 3.5% Bulk Warehouse BRL $ 11.00 BRL $ 18.00 $ 7.13 $11.67 6.5%
Manufacturing BRL 9.00 BRL 10.00 $ 5.83 $ 6.48 3.0% Manufacturing BRL $ 11.00 BRL $ 15.00 $ 7.13 $9.72 7.0%
High Tech/R&D BRL 9.00 BRL 12.00 $ 5.83 $ 7.78 3.5% High Tech/R&D BRL $ 12.00 BRL $ 18.00 $ 7.78 $11.67 6.5%
RETAIL RETAIL
Downtown BRL 10.00 BRL 16.00 $ 6.48 $ 10.37 4.0% Downtown BRL $ 80.00 BRL $ 250.00 $ 51.85 $ 162.04 9.0%
Neighborhood Service Centers BRL 11.00 BRL 14.00 $ 7.13 $ 9.07 3.5% Neighborhood Service Centers BRL $ 40.00 BRL $ 100.00 $ 25.93 $ 64.82 7.5%
Community Power Center BRL 11.00 BRL 16.00 $ 7.13 $ 10.37 3.0% Community Power Center BRL $ 80.00 BRL $ 250.00 $ 51.85 $ 162.04 8.5%
Regional Malls BRL 14.00 BRL 16.00 $ 9.07 $ 10.37 3.0% Regional Malls BRL $ 1 50.00 BRL $ 400.00 $ 97.22 $ 259.26 7.0%
Solus Food Stores BRL 11.00 BRL 14.00 $ 7.13 $ 9.07 2.5% Solus Food Stores BRL $ 150.00 BRL $ 350.00 $ 97.22 $ 226.85 7.5%

Sao Paulo, Brazil Santiago, Chile
São Paulo is located in the southeast region of Brazil and Chile has a dynamic market-oriented economy characterized
occupies an area of approximately 1,523 square kilometers. by a high level of foreign trade. Chile’s economy is based on
It is one of the most important mercantile, corporate and the export of minerals, mainly cooper, which accounts for
financial centers of Latin America. São Paulo is the largest about half of the total value of exports. Other fast growing
city in the country and the most globally influential Brazilian sectors are agriculture (fruits and cereals), cellulose, salmon
city. The city of São Paulo has 11 million inhabitants, and if and wine exports. Major developments are expected in the
the entire metropolitan region is considered, the population extraction of gold, since more than three high-grade gold
grows to 22 million inhabitants. deposits were discovered recently.
The high growth rate that occurred during 2008 was not The office market has experienced major growth. In the last
repeated in 2009. However, the market continues to grow at 12 months a total of 14 Class A office buildings entered the
a solid pace. Due to the presidential elections that will occur market, increasing Santiago office stock by 7% and reaching
in 2010, the pace of the construction has been accelerated a total inventory of 1.6 million SM. Vacancy rates have
on the southern stretch of the "Rodoanel Mario Covas," ring shown an upward trend, due to the large amount of projects
road for political reasons. Given this unexpected push, the that entered the market during Q3 2009. Vacancy levels
anticipated delivery date of this logistically important road is reached 5.75% for Class A office buildings. In the next 24
now early 2010. months we expect explosive growth of 456,000 SM of Class
Contact Contact A office space.
The office inventory continues to grow and developers in the
NAI Commercial NAI Sarra
region are beginning to offer Class A office property in modular Lease and sale rates have maintained stable levels. The
Properties Brazil +56 2 347 7000
condominiums and Build to Suits. However, availability of average leasing rate in the Santiago CBD is US $24/SM.
+1 55 11 5506 5655
high quality industrial property still is insufficient to meet the Strip centers have become very popular in the last five years
strong demand, keeping the vacancy rates low and prices with a projected investment of US $500 million in the near
stable and high. The retail market suffered less than other future by the main player in this area. Lease rates in the
sectors, mainly due to the low availability and the continued most popular retail zones in downtown Santiago have
high demand throughout the year. Its outlook is expected reached US $190/SM/month. In these areas there is virtually
to be strong for the near term; especially in the shopping no space available.
centers and supermarkets. Industrial supply has grown, especially the number of
Country Data The office market did feel some effects of the crisis with Country Data industrial parks. Prices have not significantly changed during
decreasing demand starting in early 2009. At present, as 2009. The average sale value for land in industrial parks is
Area 756,950
a result of the government’s ad hoc national economic US $120/SM. Investment returns have stabilized between
Area 756,950
measures, a return to increased activity in the real estate 7-9% for office, 9-11% for retail and 11-12% for industrial.
market is already on the horizon. Companies are back looking Chile is regarded as the first economy in the region likely to
to expand. And both Brazilian and international investors bounce back in 2010 from the current economic downturn,
have returned to inject their capital into the economy. and its economy is already showing signs of recovery after
GDP 2008 (US$ B) $150.36 GDP 2008 (US$ B) $150.36
The economic setting present today in Brazil is unprece- the economic slump. A favorable scenario for the real estate
dented. The general feeling is that as availability of credit market is forecasted in 2010.
improves Brazil will be able to foment an expansion never
seen before. The changes will be visible mainly in four
principal areas: capital, infrastructure, retail and real estate.
Rate (%) Rate (%)
Sao Paulo At A Glance Santiago At A Glance

Conversion 1.72 BRL = 1 US$ RENT/M2/YR US$ NET RENT/SF/YR RENT/M2/YR US$ RENT/SF/YR
New Construction (AAA) BRL 75.00 BRL 110.00 $ 48.61 $ 71.30 4.3% New Construction (AAA) CLP$ 147,851 CLP$ 197,970 $ 25.16 $ 33.68 4.0%
Class A (Prime) BRL 70.00 BRL 100.00 $ 45.37 $ 64.82 5.5% Class A (Prime) CLP$ 122,792 CLP$ 145,345 $ 20.89 $ 24.73 5.8%
Class B (Secondary) BRL 50.00 BRL 90.00 $ 32.41 $ 58.33 6.1% Class B (Secondary) CLP$ 105,250 CLP$ 125,298 $ 17.91 $ 21.32 2.0%
New Construction (AAA) BRL 55.00 BRL 65.00 $ 35.65 $ 42.13 5.0% New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) BRL 52.00 BRL 62.00 $ 33.70 $ 40.19 5.5% Class A (Prime) N/A N/A N/A N/A N/A
Class B (Secondary) BRL 50.00 BRL 60.00 $ 32.41 $ 38.89 10.2% Class B (Secondary) CLP$ 85,202 CLP$ 98,985 $ 14.50 $ 16.84 13.5%
Bulk Warehouse BRL 18.00 BRL 25.00 $ 11.67 $ 16.20 2.0% Bulk Warehouse CLP$ 15,035 CLP$ 25,059 $ 2.56 $ 4.26 6.5%
Manufacturing BRL 16.00 BRL 18.00 $ 10.37 $ 11.67 5.0% Manufacturing CLP$ 17,541 CLP$ 22,553 $ 2.98 $ 3.84 3.5%
High Tech/R&D BRL 16.00 BRL 22.00 $ 10.37 $ 14.26 3.0% High Tech/R&D CLP$ 30,071 CLP$ 39,343 $ 5.12 $ 6.69 5.0%
RETAIL RETAIL
Downtown BRL 20.00 BRL 180.00 $ 12.96 $ 116.67 5.0% Downtown CLP$ 250,596 CLP$ 1,252,980 $ 42.64 $ 213.20 N/A
Neighborhood Service Centers BRL 50.00 BRL 100.00 $ 32.41 $ 64.82 8.0% Neighborhood Service Centers CLP$ 200,476 CLP$ 300,712 $ 34.11 $ 51.17 4.00%
Community Power Center BRL 60.00 BRL 150.00 $ 38.89 $ 97.22 6.0% Community Power Center CLP$ 30,071 CLP$ 37,589 $ 5.12 $ 6.40 4.00%
Regional Malls BRL 150.00 BRL 400.00 $ 97.22 $ 259.26 8.0% Regional Malls N/A N/A N/A N/A N/A
Solus Food Stores BRL 100.00 BRL 200.00 $ 64.82 $ 129.63 6.0% Solus Food Stores CLP$ 37,589 CLP$ 62,649 $ 6.40 $ 10.66 N/A
DEVELOPMENT LAND Low/Acre High/Acre Low/Acre High/Acre DEVELOPMENT LAND Low/M2 High/M2 Low/M2 High/M2
Office in CBD N/A N/A N/A N/A Office in CBD CLP$ 392,600 CLP$ 584,724 $ 66.80 $ 99.49
Land in Office Parks N/A N/A N/A N/A Land in Office Parks CLP$ 208,830 CLP$ 261,037 $ 35.53 $ 44.42
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks CLP$ 52,207 CLP$ 83,532 $ 8.88 $ 14.21
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park CLP$ 20,883 CLP$ 125,298 $ 3.55 $ 21.32
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land CLP$ 208,830 CLP$ 417,660 $ 35.53 $ 71.07
Residential N/A N/A N/A N/A Residential CLP$ 104,415 CLP$ 229,713 $ 17.77 $ 39.09

San Jose, Costa Rica Kingston, Jamaica
Like most markets, Costa Rica felt the impact of the financial The Jamaican property market has suffered less than many
world crisis. Almost immediately affected was the tourism of the developed overseas markets. The banking system
sector which generated our own internal crisis in the pacific remains strong with no significant fallout or failures. Growth
coast due to the considerable reduction in the flow of in the property sector has been restricted mainly by
tourists which had a negative impact on all industries the Government decision to initially raise interest rates in
supported by tourism. The investment in on going projects response to the global crisis. Currently, interest rates are
as well as projects ready to break ground, stagnated due to falling, but benchmark rates are still in the high teens.
a near total credit restriction. Higher mortgage rates, particularly in the residential sector,
The office market is beginning to experience a higher have stifled the market.
absorption rate with almost 50,000 SM, also approximately There remains a shortage of quality office units with
20,000 SM of new projects came into the market increasing adequate parking facilities. Little new space has been built
the inventory and several international companies arrived in recent years as development costs for new buildings have
leasing new spaces. A good sign of recover is the reduction exceeded the developed value. The situation is changing
in the vacancy rate from 12% in Q3 to the current 8%. There and, currently a number of developers are seeking sites
was a 3% increase in inventory from 724,955 SM to to develop. Local planning regulations are insisting on
745,469 SM. According to our projections, the office market adequate parking for staff and clients, which adds a new
Contact could expect a considerable recovery by mid 2010, return- Contact element to development costs. Actual rental rates obtained
NAI Costa Rica ing to its normal behavior, where supply and demand works NAI Jamaica by landlords are somewhat capped due to the high monthly
+ 506 2228 7760 hand in hand with the growth of the economy. +1 876 925 7861 maintenance charges, which can be higher than rentals.
The retail market is still realizing positive demand. Inside Electricity and security costs are the main factor in this cost.
the malls, occupancy and pricing has remained stable. At Office yields have risen from around 9% over a year ago
the strip and neighborhood centers, occupancy is lower, towards 12%, currently. Rental levels remain firm.
with some retailers having closed or changed locations to The only activity in the industrial market has been a small
less expensive sites. However, this market continues to number of large owner-occupier developments, mainly in
grow quickly. the warehousing and distribution sectors. Rental demand
On the industrial side, exportation decreased in the last for units in the more desirable areas (for staff and
quarter. Absorption is lower, but the development of new customers) often dictates rental levels. Such space
Country Data Country Data over10,000 SF is limited.
space is more controlled than in other markets. The FTZ’s
Area 1,972,550
have been receiving interest from and negotiating with, more There has been little new expansion in the retail market.
Area 13,940
companies and are expected to welcome around 20 inter- Fallout, with the reduction in retail activity, has been minimal.
GDP Growth (%) -1.30%
national companies in the next 18 months, creating a good Yields in this market tend to follow the office market. New
opportunity in the marketplace. GDP Growth (%) -3.61% development in the resort market has been virtually non-
GDP 2008 (US$ B) $29.29 existent this year
In 2009 the most significant transactions were: Forum II with GDP 2008 (US$ B) $11.92
8000 SM, Plaza Roble with 6000 SM, Zona Franca de Este The main factors governing desirability of property in
with 11100 SM and Zona Franca America with 4000 SM. Jamaica is the location in relation to the areas perceived as
unsafe for staff and customers. Areas of the main cities are
well defined with distinct value levels.
Unemployment
Rate (%) 4.90% 11.00%
Unemployment
Rate (%)
San Jose At A Glance Kingston At A Glance

Conversion: 550 COL = 1 US$ RENT/M2/MO US$ RENT/SF/YR Conversion: 89 J$ = 1 US$ RENT/M2/MO US$ RENT/SF/YR
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) COL 111,360 COL 125,280 $ 17.84 $ 20.07 24.0% Class A (Prime) J$ 484.00 J $ 807.00 $ 6.06 $ 10.11 N/A
Class B (Secondary) COL 69,600 COL 111,360 $ 11.15 $ 17.84 7.0% Class B (Secondary) J$ 242.00 J $ 484.00 $ 3.03 $ 6.06 N/A
New Construction (AAA) COL 139,200 COL 180,960 $ 22.30 $ 28.99 3.0% New Construction (AAA) J $ 1,130.00 J $ 1,453.00 $ 14.15 $ 18.20 N/A
Class A (Prime) COL 111,360 COL 174,000 $ 17.84 $ 27.87 8.0% Class A (Prime) J $ 1,130.00 J $ 1,453.00 $ 14.15 $ 18.20 N/A
Class B (Secondary) COL 69,600 COL 139,200 $ 11.15 $ 22.30 8.0% Class B (Secondary) J $ 969.00 J $ 1,130.00 $ 12.14 $ 14.15 N/A
Bulk Warehouse COL 27,840 COL 69,600 $ 4.46 $ 11.15 12.0% Bulk Warehouse J$ 404.00 J$ 969.00 $ 5.06 $ 12.14 N/A
Manufacturing COL 31,320 COL 45,240 $ 5.02 $ 7.25 4.0% Manufacturing J$ 404.00 J$ 969.00 $ 5.06 $ 12.14 N/A
High Tech/R&D COL 24,360 COL 34,800 $ 3.90 $ 5.57 1.0% High Tech/R&D N/A J $ 1,130.00 N/A $ 14.15 N/A
RETAIL RETAIL
Downtown COL 55,680 COL 153,120 $ 8.92 $ 24.53 9.7% Downtown (High Street Shops) J$ 807.00 J $ 1,453.00 $ 10.11 $ 18.20 N/A
Neighborhood Service Centers COL 69,600 COL 180,960 $ 11.15 $ 28.99 3.6% Neighborhood Service Centers N/A N/A N/A N/A N/A
Community Power Center COL 76,560 COL 208,800 $ 12.26 $ 33.44 0.8% Community Power Center (Big Box) N/A N/A N/A N/A N/A
Regional Malls COL 160,080 COL 236,640 $ 25.64 $ 37.90 N/A Regional Malls J$ 1,211.00 J$ 1,776.00 $ 15.17 $ 22.25 N/A
Solus Food Stores COL 41,760 COL 76,560. $ 6.69 $ 12.26 1.1% Solus Food Stores N/A N/A N/A N/A N/A
DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF DEVELOPMENT LAND Low/ M2 High/M2 Low/SF High/SF
Office in CBD N/A N/A N/A N/A Office in CBD J$ 12.00 J$ 30.00 $ 0.13 $ 0.34
Land in Office Parks N/A N/A N/A N/A Land in Office Parks J$ 12.00 J$ 20.00 $ 0.13 $ 0.22
Land in Industrial Parks N/A N/A N/A N/A Land in Industrial Parks J$ 5.00 J$ 8.00 $ 0.06 $ 0.09
Office/Industrial Land - Non-park N/A N/A N/A N/A Office/Industrial Land - Non-park J$ 10.00 J$ 13.00 $ 0.11 $ 0.15
Retail/Commercial Land N/A N/A N/A N/A Retail/Commercial Land J$ 10.00 J$ 13.00 $ 0.11 $ 0.15
Residential N/A N/A N/A N/A Residential J$ 6.00 J$ 15.00 $ 0.07 $ 0.17

Ciudad Juarez, Chihuahua, Mexico Guadalajara, Mexico
Juarez is the largest city in Chihuahua, with a population of As Mexico’s second-largest city, Guadalajara has managed
2 million inhabitants. It is located across from El Paso, Texas, to modernize without seriously altering its centuries old city
and has been a destination for foreign manufacturing since plan or endangering the quality of life of its inhabitants.
the 1960s. Manufacturing facilities known as “maquiladoras” Guadalajara is known as the "Silicon Valley of Mexico” with
drive the economy. Of Mexico’s foreign manufacturing the establishment of multinational technology firms such as
plants, 90% are situated along the US-Mexico border and IBM, HP, Foxxcon, Flextronics, SCI-Sanmina and Freescale.
33% are found in Juarez. Most of the new office projects initiated during 2008 and
Approximately 330 registered maquiladora operations are 2009 are expected to reach the market in late 2010 due to
located in Juarez, employing more than 200,000 people. slowed construction by most developers. New projects in
Juarez is home to companies such as Philips, Thomson, GM, 2010 will include Class A+ (AAA) buildings in Puerta de
Electrolux, Yazaki, Foxconn, Lear, Johnson & Johnson, GE Hierro and Americas-Country corridor. The majority of demand
Medical, Johnson Controls, Delphi and Ford. is from Mexican national firms; however, multinational compa-
At the outset of 2010, the market is expected to change nies are also securing space from 1,500 to 10,000 SF. Office
from a landlords’ market to at tenants’ market with this market vacancy in Class B buildings is projected to average
trend continuing into 2011. Early signs of expansion were 20-25%. Nevertheless, finding buildings with 10,000 SF con-
noted by the end of 2009 with another wave of projects on tinuous is challenging.
Contact Contact
the horizon. Guadalajara has become a destination market for major
NAI Mexico NAI Mexico
At the outset of 2010, only one new industrial facility is industrial developers. Aggressive promotion has nearly
+1 619 690 3029 +1 619 690 3029
under construction. The global economic crisis during 2009 doubled the city’s industrial base during the past four
slowed investment by manufacturers and as demand fell so years. Industrial land and facility rental rates are expensive
did lease rates. Juarez vacancy rates rose for the first time in Guadalajara. Sale prices range from $80-$150/SM,
to over 10%. As a result, lease rates fell by about 20-30% ranking Guadalajara among the most expensive areas in
and developer incentives, such as free rent, were noted. Mexico. Lease rates for assembly and manufacturing space
are above Mexico’s national average. During 2009, demand
The office market remains flat. The limited amount of Class has been flat and lease rates did not increase, resulting
A space is occupied by local firms, government agencies in landlords continuing to experience excess inventories
and global service providers with regional operations. Activity during 2010. Guadalajara will remain a “tenants’ market”
Country Data was slower with lease rates falling and vacancies rising Country Data during 2010.
Area 1,972,550 in the range of 10-20% during 2009. Overall rates are Area 1,972,550
predicted to remain stable during 2010. The retail sector in Guadalajara experienced decreased
vacancy in 2009 and it is projected to continue throughout
GDP Growth (%) -7.34% US retailers such as Costco, Wal-Mart, Sam's, Auto Zone GDP Growth (%) -7.34%
2010. Convenience stores such as Oxxo, 7 Eleven and
and Home Depot are following Mexican retailers into the Waldo’s are seeking both in-line and pad sites. Retail space
GDP 2008 (US$ B) $866.34 market and prospects for 2010 are improving. GDP 2008 (US$ B) $866.34 rates and land values remained flat in most commercial
Juarez’s critical mass of industrial firms, proximity to all US submarkets during 2009.
GDP/Capita (USD) $8,040.24 markets and a 50-year history with foreign manufacturers GDP/Capita (USD) $8,040.24
Guadalajara remains a core market in central Mexico with a
ensure the future will be bright. Most believe 2010 will be strong mix of foreign and national firms active in the market.
Inflation Rate (%) 5.43% a rebound year with increased activity by the second half Inflation Rate (%) 5.43%
Projections are positive with sharp increases in demand
and continuing in force through 2012 and beyond. forecast for Q3 and Q4 2010.
Rate (%) Rate (%)
Juarez At A Glance Guadalajara At A Glance

RENT/SF/YR RENT/SF/YR
Low High Effective Avg. Vacancy Low High Effective Avg. Vacancy
New Construction (AAA) $ 12.00 $ 17.00 $ 14.50 N/A New Construction (AAA) N/A N/A N/A N/A
Class A (Prime) $ 9.00 $ 13.00 $ 11.00 8.0% Class A (Prime) $ 10.37 $ 15.55 N/A 20.0%
Class B (Secondary) $ 8.00 $ 10.00 $ 8.75 20.0% Class B (Secondary) $ 8.29 $ 10.37 N/A 25.0%
New Construction (AAA) $ 12.00 $ 17.00 $ 14.50 15.0% New Construction (AAA) $ 23.41 $ 27.87 N/A N/A
Class B (Secondary) $ 8.00 $ 10.00 $ 8.75 20.0% Class B (Secondary) N/A N/A N/A N/A
Bulk Warehouse $ 3.30 $ 4.00 $ 3.60 11.5% Bulk Warehouse $ 4.15 $ 5.18 N/A 9.0%
Manufacturing $ 4.00 $ 6.00 $ 4.80 11.5% Manufacturing $ 5.18 $ 6.82 N/A 8.0%
High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 11.15 $ 16.72 N/A 2.0%
RETAIL RETAIL
Downtown $ 15.00 $ 20.00 $ 13.00 N/A Downtown $ 15.00 $ 20.00 N/A 7.0%
Neighborhood Service Centers $ 10.00 $ 12.00 $ 9.50 27.5% Neighborhood Service Centers $ 15.00 $ 20.00 N/A 8.0%
Community Power Center N/A N/A N/A N/A Community Power Center $ 15.00 $ 20.00 N/A 2.0%
Regional Malls N/A N/A N/A N/A Regional Malls $ 20.00 $ 50.00 N/A 15.0%
DEVELOPMENT LAND Low/SF High/SF DEVELOPMENT LAND Low/M2 High/M2

Office in CBD N/A N/A Office in CBD $ 700.00 $ 1,500.00
Land in Office Parks $ 5.57 $ 180.00 Land in Office Parks $ 250.00 $ 500.00
Land in Industrial Parks $ 3.25 $ 50.00 Land in Industrial Parks $ 80.00 $ 150.00
Office/Industrial Land - Non-park) N/A N/A Office/Industrial Land - Non-park $ 100.00 $ 300.00
Retail/Commercial Land $7.45 $ 24.00 Retail/Commercial Land $ 350.00 $ 800.00
Residential $ 9.00 $ 19.00 Residential $ 250.00 $ 750.00

Guanajuato, Guanajuato, Mexico Mexico City, Mexico
The city of Guanajuato has approximately 5 million inhabi- Mexico City, the capital of Mexico, is located in South-Cen-
tants and is located in the area of Mexico known as “El tral Mexico and has over 23 million inhabitants. Mexico City
Bajio.” Guanajuato is centrally located in Mexico with five is often seen as the first stop for foreign investors interested
neighboring states: Jalisco to the west, San Luis Potosi and in development, industrial, retail and office investments. In
Zacatecas to the south, Queretaro to the east and Michoacan 2008, Mexico joined the group of top 12 economies in the
to the north. world ($1 trillion GDP), maintains an investment grade rating
Guanajuato is at the crossroads of two major industrial and is the eighth largest world exporter.
corridors: Highway 45 (The Pan American Highway) Mexico City is host to major corporate headquarters from a
and Highway 57 (the NAFTA Highway), which links South variety of global sectors. National firms with headquarters in
America, Mexico and North America. Multimodal capabilities Mexico City include Grupo Modelo, Grupo Carso, Telmex,
are available in several locations. Guanajuato also hosts the DESC, GICSA and BIMBO. Automotive firms include GM,
only intersection of the Kansas City and Ferromex railroads Ford, Volkswagen, Nissan, Honda and Chrysler. Most multi-
in Mexico. Major corporations based in Guanajuato include nationals like Coca Cola, Pepsi, Honeywell, Siemens,
GM, American Axle, Colgate Palmolive, Flex-n Gate, Fiberweb, Motorola, USG, IBM, HP, Samsung, Sony, INTEL, LG, P&G
Avon, Faurecia, Hino Motors, Getrag Ford, Flexi and Hella. and Wal-Mart maintain headquarters in Mexico City.
Contact Completed transactions during 2009 included Hino Motors Contact Mexico City and Toluca encompass more than 17 million
(Automotive), Samot (Metal Mecanic) and Teco Westing- SM of industrial land. At the end of 2009, the largest
house (Power Solutions), all of them build-to-suit projects. vacancy among the main industrial submarkets in the
+1 619 690 3029 +1 619 690 3029
Vacancy rates during 2009 decreased from 10.14% to Mexico City metro area was registered in Cuautitlan with
9.8% as a result of the lease of “Pisa Company” and “TLG” 20% of the total industrial inventory. Recent developments
in Castro Del Rio Industrial Park and the delivery of 247,572 include Tlalnepantla, Toluca-Lerma and now Huehuetoca.
SF of build-to-suit projects in Santa Fe Industrial Park. Lease rates and land values have not fallen and are
Guanajuato’s office market is small and most space is expected to remain unchanged during 2010.
composed of low rise, garden office type projects that host The retail sector cooled rapidly during 2009 although
Mexican local firms and global service providers. Lease rates Amway, Wal-Mart, Costco, Home Depot, Best Buy and other
and land values are steady and not projected to rise during big box retailers experienced some growth, even under the
Country Data 2010. Country Data negative economic conditions. However, the rate of expan-
The retail sector consists of large multi-tenant shopping sion for these retailers decreased across the board.
centers located in middle and low income areas such as Area 1,972,550
Investors are now looking for stand-alone sites, strip centers
Area 1,972,550
Plaza El Suez. Lease rates and land value are expected to and anchored retail centers for 2010.
GDP Growth (%) -7.34% remain stable through 2010. GDP Growth (%) -7.34% Office market vacancies were under 10% in 2009 due to
Guanajuato’s unique central location in Mexico and its high demand from the number of companies seeking office
GDP 2008 (US$ B) $866.34 position at the crossroads of the nation’s two largest rail GDP 2008 (US$ B) $866.34 space and limited inventory due to the lack of new buildings
lines and highways position it to become a major trade on the market. New construction projected for late 2009
corridor into North America for many years to come. GDP/Capita (USD) $8,040.24
has been delayed and only those buildings with over 80%
completion are being finalized. Lease rates are running from
$24-$40/SM per month. In general, the Mexico City office
market remains strong and a constant demand for product
promises a robust market for 2010.
Rate (%) Rate (%) Mexico City will continue to be a first stop for foreign in-
vestors. Its critical mass, domestic market demand and po-
Interest Rate (%) 4.5% Interest Rate (%) 4.5% sition as a place for Latin American regional headquarters
ensure continued growth and a positive forecast for 2010
Population (Millions) 107.75 and beyond. Mexico City will remain a global destination for
both corporate users and investors for many years to come.
Guanajuato At A Glance Mexico City At A Glance
RENT/SF/YR RENT/M2/MO US$ RENT/SF/YR
Low High Effective Avg. Vacancy Low High Low High Vacancy
New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 24.00 $ 40.00 $ 26.76 $ 44.59 10.0%
Class A (Prime) $ 9.60 $ 12.86 $ 11.23 12.0% Class A (Prime) $ 18.00 $ 24.00 $ 20.07 $ 26.76 20.0%
Class B (Secondary) $ 4.40 $ 8.76 $ 6.58 12.0% Class B (Secondary) $ 8.00 $ 15.00 $ 8.92 $ 16.72 35.0%
New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 20.00 $ 25.00 $ 22.30 $ 27.87 30.0%
Class A (Prime) $ 7.48 $ 14.57 $ 11.02 4.0% Class A (Prime) $ 15.00 $ 20.00 $ 16.72 $ 22.30 35.0%
Class B (Secondary) $ 4.33 $ 8.68 $ 6.50 4.0% Class B (Secondary) $ 10.00 $ 16.00 $ 11.15 $ 17.84 25.0%
Bulk Warehouse $ 3.48 $ 4.40 $ 3.94 9.8% Bulk Warehouse $ 4.00 $ 6.00 $ 4.46 $ 6.69 16.0%
Manufacturing $ 4.35 $ 4.70 $ 4.52 9.8% Manufacturing $ 4.00 $ 7.00 $ 4.46 $ 7.80 15.0%
High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 5.00 $ 7.00 $ 5.57 $ 7.80 20.0%
RETAIL RETAIL
Downtown $ 13.50 $ 24.25 $ 18.87 N/A Downtown (High Street Shops) $ 12.00 $ 50.00 $ 13.38 $ 55.74 15.0%
Neighborhood Service Centers $ 15.90 $ 27.50 $ 21.70 N/A Neighborhood Service Centers $ 18.00 $ 26.00 $ 20.07 $ 28.99 20.0%
Community Power Center N/A N/A N/A N/A Community Power Center (Big Box) $ 25.00 $ 40.00 $ 27.87 $ 44.59 12.0%
Regional Malls $ 15.50 $ 33.37 $ 24.43 N/A Regional Malls $ 35.00 $ 40.00 $ 39.02 $ 44.59 20.0%
DEVELOPMENT LAND Low/M2 High/M2
DEVELOPMENT LAND Low/ M2 High/M2 Low/SF High/SF
N/A N/A Office in CBD $ 1,280.00 $ 3,000.00 $ 118.91 $ 278.71

Office in CBD
N/A N/A Land in Office Parks $ 408.00 $ 878.00 $ 37.90 $ 81.57
Land in Office Parks
$ 25.00 $ 37.00 Land in Industrial Parks $ 60.00 $ 243.00 $ 5.57 $ 22.58
Land in Industrial Parks
$ 22.00 $ 33.00 Office/Industrial Land - Non-park $ 100.00 $ 325.00 $ 9.29 $ 30.19
Office/Industrial Land - Non-park
$ 100.00 $ 300.00 Retail/Commercial Land $ 215.00 $ 690.00 $ 19.97 $ 64.10
Retail/Commercial Land
Residential $ 265.00 $ 560.00 $ 24.62 $ 52.03
Residential $ 150.00 $ 500.00

Matamoros, Tamaulipas, Mexico Mexicali, Baja California, Mexico
Matamoros is an important maquiladora center with over Mexicali, a thriving metropolitan area with 900,000 residents,
65,000 workers in approximately 140 plants. Major sectors is the capital of Baja California and home to approximately
for industrial export range from heavy steel products to 200 maquiladora operations. Mexicali is an industrial center
metal mechanics, automotive and electronic products. with a high work ethic, which has been a contributing factor
Besides proximity to Brownsville, Texas, it is located on the in the relocation of more than 100 new manufacturing com-
major trade corridor serving the Midwest and Eastern US. panies to Mexicali from 1996 to 2009.
During 2009, industrial lease rates fell 10-20% for Class B Industrial activity was slow during 2009. Crystal automotive
and C facilities. Shell rates averaged $0.36/SF/month. assumed Fleetwood’s 100,000 SF facility, Newell Rubber-
During 2010, tenants should experience a “tenants’ market” maid expanded its operation, Global Logistics relocated to a
and receive additional incentives for free rent and time to larger building with 62,000 SF and Judco Manufacturing
retrofit space. purchased the 40,000 SF. LG Innotek facility. La Moderna
2009 reflected the same fall in demand and consolidation from Central Mexico acquired land in Ejido Pueblo for pasta
in Matamoros as the rest of the Mexican industrial markets. production and Fabrica de Papel San Francisco purchased
Delphi placed three facilities of 700,000 SF on the market land for its distribution center.
at the end of 2009. New projects included Hilti, Inteva, Tyco During 2009, several firms consolidated to other markets,
Contact and Core. More demand will occur in 2010 due to projected Contact including Sony, LG Electronics, Mag Technology, Kwang
expansions from existing operations. Industrial land values Sung, Starion, and Kyomex. During 2009, Silicon Border
remained consistent during 2009 with asking prices ranging Science Park was selected by Q-Cells, the world’s largest
+1 619 690 3029 +1 619 690 3029
from $30-$40/SM. No change is expected for 2010. solar cell manufacturer for its $3.5 billion project.
Matamoros’ office market is primarily composed of small Prices for industrial land have remained flat since the
projects hosting local service industries. Only one small purchase of large development tracts by Thompson
office building was constructed during 2009 in the down- Electronics and Alen Industries. Industrial lease rates will re-
town area. The outlook for the office market in 2010 projects main flat and competitive for 2010.
rates will remain the same and demand will be generated The office market is small with most office projects no larger
from local and regional operations. than three stories and located in one of three commercial
Retail centers in Matamoros host a blend of domestic brands corridors in the city. During 2009, construction began for
Country Data with a mix of US franchisees and big box operations. The Country Data the three-story “Solarium Building.” Most retail centers are
growth in 2008 and 2009 has been limited to the Area 1,972,550 small strip or food and drug anchored neighborhood centers.
Area 1,972,550 expansion of Mexican retailers (Soriana, Coppel, Home Mart, Lease rates are expected to remain flat during 2010 and
SMart) with the exception of HEB and Sam’s Club. 2010 GDP Growth (%) -7.34% Mexicali is expected to remain a destination for national
GDP Growth (%) -7.34% lease rates and land prices are expected to remain the same. retailers and new US firms entering the market.
Matamoros’ unique location on the NAFTA Highway, its GDP 2008 (US$ B) $866.34 Mexicali holds a unique position on the Mexican border with
GDP 2008 (US$ B) $866.34 border location, strong industrial tradition and ability to ship overnight drive times to most Western US markets. Its
overnight to much of the US make it a destination for foreign GDP/Capita (USD) $8,040.24 industrial culture, abundant water and natural gas supply
GDP/Capita (USD) $8,040.24 firms to locate new projects in Mexico. The long term outlook will help to maintain it as a destination for foreign operations
is very favorable through 2010 and beyond. Inflation Rate (%) 5.43% through 2010 and many years to come.
Unemployment 6.06%
Unemployment 6.06% Rate (%)
Rate (%)
Matamoros At A Glance Mexicali At A Glance

(Rent/SF/YR) (Rent/SF/YR)
New Construction (AAA) $ 8.40 $ 18.00 $ 12.00 20.0% New Construction (AAA) N/A N/A N/A N/A
Class A (Prime) $ 6.00 $ 8.40 $ 8.40 30.0% Class A (Prime) $ 12.00 $ 21.60 $ 10.80 14.0%
Class B (Secondary) $ 2.40 $ 6.00 $ 4.80 30.0% Class B (Secondary) $ 3.60 $ 10.00 $ 6.00 10.0%
Class A (Prime) $ 6.00 $ 8.40 $ 8.40 10.0% Class A (Prime) N/A N/A N/A N/A
Bulk Warehouse $ 3.84 $ 4.56 $ 4.56 10.0% Bulk Warehouse $ 3.36 $ 4.32 $ 3.84 6.0%
Manufacturing $ 4.56 $ 6.00 $ 5.76 N/A Manufacturing $ 4.08 $ 5.52 $ 5.28 8.0%
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 15.0% Downtown $ 3.60 $ 6.00 $ 4.80 3.0%
Neighborhood Service Centers $ 8.40 $ 9.60 $ 9.00 30.0% Neighborhood Service Centers $ 6.00 $ 7.20 $ 6.60 10.0%
Community Power Center $ 11.16 $ 12.00 $ 11.64 20.0% Community Power Center N/A N/A N/A N/A
Regional Malls $ 9.60 $ 10.80 $ 10.20 10.0% Regional Malls $ 8.40 $ 16.00 N/A 4.0%
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 $ 200,000 Residential $ 485,830.00 $ 931,174.00

Monterrey, Nuevo Leon, Mexico Querétaro, Querétaro, Mexico
Monterrey, Nuevo Leon is located in North Central México, Queretaro, with an estimated population of 1.34 million, is
140 miles southwest of Laredo, Texas. It is the third largest one of the smallest but most active and productive states for
metropolitan area in Mexico, with a population of approxi- business in Mexico. Located in Central Mexico in the famous
mately 4.5 million. An industrial city with a 100-year “El Bajio” region, Queretaro occupies a strategic location
operating history, it is sometimes referred to as the Chicago adjacent to nine neighboring states. Additionally, Queretaro
of Mexico. is positioned on a critical trade corridor, the NAFTA Highway
Monterrey is well positioned as the major industrial market (57), linking South America, Mexico and North America.
in Northeast Mexico. It is host to many multinational The unique advantage of being located in Central Mexico
corporations such as BASF, Carplastics, Brachs, Caterpillar, and within four hours driving distance of 70% of Mexico’s
Daewoo, Denso, GE, JCI, Navistar, Mattel, Panasonic, Parker, population makes Queretaro a major logistics hub. More
LG, Whirlpool, Sara Lee, Saturn, Elcoteq LG, Rockwell and than 45 million inhabitants live within a 135-mile radius.
many more. Monterrey offers more than 30 industrial parks. Queretaro hosts 19 industrial parks and zones. The automo-
Compared with other markets in Mexico, industrial lease tive sector has four assembly plants, 57 Tier-one suppliers,
rates have only dropped to a small degree, although more 100 Tier-two suppliers and more than 30,000 workers. The
concessions are being offered. Vacancy rates are hovering Aerospace sector is the next emerging market. At the end of
near 11%. Activity in the industrial market was very slow 2009, 2.1 million SF was under construction for Grupo
Contact during the first half of 2009; only five new foreign compa- Contact
Safran and Calamanda Distribution. Construction for 2010
NAI Mexico nies commenced operations in that period. However, there NAI Mexico
will be primarily for build-to-suits.
+1 619 690 3029 are more than 15 companies negotiating new spaces at the +1 619 690 3029
end of 2009 as they take advantage of landlord concessions During 2009, Queretaro promoted large capital investments
and recently discounted labor rates. with Bombardier, Meggitt, Metrocolor and Exco. Industrial
lease rates fell 10-15% in existing industrial space. Strong
The office market experienced slow but positive growth competition among developers to offer creative incentives
during 2009 with vacancy rates ranging from 5-12% in var- and flexible lease contracts ensures that 2010 will be a
ious submarkets. Although vacancy rates are slowly falling, “tenants’ market” through 2011.
rental rates have not begun to rise and range from
$15-$25/SM. At the end of 2009 there are four projects Queretaro’s office sector is composed mainly of low rise,
under construction ranging from 20,000-70,000 SF. garden, office type projects. Lease rates and land values in
Country Data Country Data 2010 for office facilities are projected to remain stable.
Retail is positive even with the global slowdown during 2009 Retail growth was steady during 2009. Retail construction in
Area 1,972,550
as Wal-Mart, Sams, Costco, Sears and other franchisees 2010 will continue with the launch of mixed use projects
Area 1,972,550
searched for sites in Monterrey. The future for 2010 through and strip centers.
GDP Growth (%) -7.34% 2012 is bright. Home Depot and Lowes will continue to
GDP Growth (%) -7.34% Queretaro’s unique location on the NAFTA Highway, its
expand their presence.
GDP 2008 (US$ B) $866.34 Central Mexico proximity to distribute to major population
Monterrey’s growth prospects are excellent. Its long indus- GDP 2008 (US$ B) $866.34 centers and free trade zones, make it a destination for
trial history, proximity to the US and unique technical foreign firms to locate new projects in Mexico. The long term
infrastructure ensure that it will be one of the strongest outlook is extremely favorable through 2010 and beyond.
industrial locations in Mexico during 2010.
Unemployment 6.06%
Rate (%) Unemployment 6.06%
Rate (%)
Monterrey At A Glance Querétaro At A Glance

RENT/SF/YEAR (Rent/SF/YR)
New Construction (AAA) $ 14.91 $ 19.89 $ 17.83 5.0% New Construction (AAA) $ 14.93 $ 20.81 $ 17.87 15.0%
Manufacturing $ 4.32 $ 5.04 $ 4.35 9.0% Manufacturing $ 3.82 $ 4.82 $ 4.32 10.0%
High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 7.80 $ 12.24 $ 10.02 5.0%
RETAIL RETAIL
Downtown $ 27.34 $ 45.98 $ 27.87 6.0%
Downtown $ 13.32 $ 22.32 $ 17.82 N/A
Neighborhood Service Centers $ 19.88 $ 24.86 $ 21.18 12.0%
Neighborhood Service Centers $ 14.76 $ 24.48 $ 19.62 N/A
Community Power Center N/A N/A N/A N/A
Regional Malls $ 25.47 $ 62.45 $ 44.59 4.00%
Regional Malls $ 24.12 $ 44.64 $ 34.38 N/A
DEVELOPMENT LAND Low/SF High/SF

DEVELOPMENT LAND Low/M2 High/M2
Office in CBD N/A N/A Office in CBD N/A N/A
Land in Office Parks $ 4.18 $ 18.58 Land in Office Parks N/A N/A
Office/Industrial Land - Non-park $ 1.39 $ 9.29
Retail/Commercial Land $ 5.57 $ 46.45
Residential $ 13.94 $ 90.00
Residential $ 150.00 $ 570.00

Reynosa, Mexico Saltillo, Coahuila, Mexico
Reynosa is a dynamic city on the northeast border of Mexico, Saltillo, located in Northeast Mexico, is the capital city of
nine miles south of McAllen, Texas, and located along the Coahuila. Saltillo ranks second in the country in international
well established NAFTA Highway. Its third international exports. It is located 180 miles south of the US border from
crossing, Anzalduas Bridge, will generate even more growth Laredo, Texas, and has a population of approximately
in 2010 based on construction of a multi-modal service 700,000 inhabitants. Saltillo is recognized as a key center
center in McAllen, which will provide even lower distribution for servicing the global automotive industry.
costs. There are five main sectors that make up the Saltillo
Reynosa is one of the top five maquiladora markets in Mexico economy; automotive, metal-mechanic, electrical-electronic,
with 13 industrial parks accommodating more than 350 plastic and aerospace. Corporations such as General
manufacturing operations. During the global consolidation Motors, Daimler Chrysler and Freightliner support Saltillo’s
of 2008-2009, Reynosa proved to be a preferred relocation automobile industry while global suppliers such as ITT,
destination for many operations, including Motorola, LG Magna, Quimmco, Johnson Controls, and John Deere are
Electronics, Panasonic and Invensys. also located here.
In 2009, industrial lease rates fell 20-30%. During 2010, 2009 reflected the same fall in demand and consolidation
tenants can look forward to a “tenants’ market” and will in Saltillo as the rest of the Mexican industrial markets.
Contact receive additional incentives for free rent and time to retrofit Contact Recent projects include Whirlpool, Aventec, GSC and Trinity.
space. 2009 resulted in the same fall in demand and More demand will occur in 2010 due to projected expan-
consolidation of product as the rest of the Mexican industrial sions from existing operations. During 2009, industrial lease
+1 619 690 3029 +1 619 690 3029
markets. Escalade and others offered facilities for lease or rates fell 10-20% for Class B and C facilities. During 2010,
sale. More demand will occur in 2010 due to projected tenants will experience a “tenants’ market” and receive
expansions from existing operations. additional incentives for free rent and time to retrofit space.
Reynosa’s office market is composed of small projects Industrial land values remained consistent during 2009 with
hosting local service industries. Most are located near major no change expected for 2010. Two new industrial parks are
arteries or close to the border and industrial housing com- under development: Amistad Airport and Santa Monica.
munities. No changes in lease rates are expected for 2010. During 2009, there were no changes in rates or prices in the
Retail availability in Reynosa is limited and lease rates office sector. Saltillo only offers two high-rise buildings and
Country Data remained stable during 2009. Vacancies remained low due Country Data smaller two- or three-story office buildings. In the retail
to strong demand from Mexican retail tenants. US retailers sector during 2009, two new shopping malls were launched:
will continue to evolve in Reynosa in 2010. New franchises Sendero Saltillo and Liverpoll. The trend for small strip cen-
Area 1,972,550 Area 11,972,550
such as Holiday Inn, Fiesta Inn, City Express, Best Western, ters continued during 2009 with more projected for 2010.
Little Cesar’s, Sirloin Stockade, Chili’s, Subway, Applebee’s, Saltillo’s unique location on the trade corridor to Texas, its
Baskin Robbins, Popeye’s and 7-11 have recently opened strong industrial tradition and its ability to ship overnight to
locations. much of the US, make it a destination for foreign firms to
GDP 2008 (US$ B) $866.34 GDP 2008 (US$ B) $866.34
Reynosa’s unique location on the NAFTA Highway, its border locate new projects in Mexico. The long term outlook is
location, strong industrial tradition and its ability to ship positive for 2010 and beyond.
overnight to much of the US make it a desirable destination
for foreign firms to locate new projects in Mexico. The long
term outlook is very favorable through 2010 and beyond.
Rate (%) Rate (%)
Reynosa At A Glance Saltillo At A Glance

(Rent/SF/YR) RENT/SF/YR
Manufacturing $3.96 $ 4.56 $ 4.32 13.0% Manufacturing $ 4.50 $ 5.04 $ 4.68 6.0%
High Tech/R&D N/A N/A N/A N/A High Tech/R&D $ 5.40 $ 6.24 $ 6.00 N/A
RETAIL RETAIL
Downtown $ 4.00 $ 5.50 $ 5.33 N/A Downtown $ 10.03 $ 15.60 $ 11.14 10.0%
Regional Malls $ 11.14 $ 28.42 $ 15.00 11.0%
Regional Malls $ 4.00 $ 5.50 $ 5.33 6.0%
DEVELOPMENT LAND Low/Acre High/Acre

DEVELOPMENT LAND Low/SF High/SF
Office in CBD $ 100,000.00 $ 145,000.00
Land in Office Parks $ 100,000.00 $ 130,000.00
Land in Industrial Parks $ 2.78 $ 3.71
Land in Industrial Parks $ 75,000.00 $ 110,000.00
Office/Industrial Land - Non-park $ 75,000.00 $ 85,000.00
Retail/Commercial Land $ 95,000.00 $ 140,000.00
Residential $ 11.14 $ 18.58
Residential $ 140,000.00 $ 200,000.00

San Luis Potosi (SLP), Mexico Tijuana, Baja California, Mexico
San Luis Potosi with a population of 1 million is located in Tijuana is located on the northwest tip of Mexico in the state
Central Mexico in the famous “El Bajio” region. San Luis Potosi of Baja California. Tijuana is primarily an industrial city with
occupies a strategic location adjacent to 10 neighboring a limited availability of high-end office space but boasts an
states. Additionally, SLP is positioned on a critical trade emerging retail sector. Tijuana has played host to the largest
corridor along the NAFTA Highway (57), linking South America, concentration of foreign manufacturing firms in Mexico
Mexico and North America. for over 40 years.
The San Luis Potosi market is centrally located within a five- At the outset of 2009, four new industrial developments
hour drive of 70% of Mexico’s population, making it a major were under construction, lease rates were at an all-time
logistics hub. San Luis Potosi now hosts Mexico’s two most high and investors had flocked to the Tijuana market.
important inland ports and free trade zones: Borderless and However, the global economic crisis slowed investment by
Interpuerto. manufacturers and as demand fell so did lease rates.
No new construction for speculative industrial projects was Tijuana’s vacancy rates rose to over 10%, a number
initiated during 2009. Construction for new projects for 2010 unmatched in any year prior. As a result, lease rates fell by
will be for build-to-suits only. San Luis Potosi now hosts large 20-30% and developer incentives such as free rent were
capital investments with General Motors. During 2009, SLP noted for the first time. At the outset of 2010, the market has
also welcomed Becton Dickinson (medical), Cosma Interna- changed from a landlords’ market to a tenants’ market and
Contact Contact this trend will continue into 2011.
tional (automotive), Perennials Fabrics Outdoors (textile) and
Aztek Technologies (steel) to the market. During 2009, Early signs of expansion were noted by the end of 2009,
+1 619 690 3029 +1 619 690 3029
industrial lease rates fell approximately 10-15% for all and it is anticipated that another wave of projects will be
classes of industrial space. Strong competition among scheduled for Tijuana throughout 2010. During 2009, Fisher
developers to offer creative incentives and flexible lease & Pakel from New Zealand was the first major operator to
contracts ensures that San Luis Potosi will be a “tenants’ take advantage of the profitable situation in the market by
market” through 2011. securing a 10-year, 200,000 SF lease.
San Luis Potosi’s office sector is composed mainly of low During 2009, one new retail project was completed on Blvd.
rise, garden, office type projects. Minor speculative office 2000 and one additional development is projected in the El
construction is projected for 2010; therefore lease rates and Florido area for 2010. US retailers such as Auto Zone, Carl’s
Country Data land values for office facilities are projected to remain stable. Country Data Jr. and Wal-Mart continue to expand their business in
During 2009, Soriana & MAZDA anchored the new “Lomas Tijuana. The Zona Rio and Agua Caliente corridors offer a
de Chapultepec.” Office Depot, Office Max, BANREGIO, Area 1,972,550
limited number of Class A office projects. Only one new Class
Area 11,972,550
Chili’s and Starbucks were the most active firms. Retail A office project completed construction in October 2009.
construction in 2010 will continue with the launch of three Tijuana’s critical mass of industrial firms, proximity to western
new mixed-use developments. US markets and 40-year history with foreign manufacturers
GDP 2008 (US$ B) $866.34 San Luis Potosi’s unique location on the NAFTA Highway, its GDP 2008 (US$ B) $866.34 project a bright future for the real estate market. Although
proximity in Central Mexico to distribute to major population 2010 is expected to be a rebound year, increased activity is
centers and several free trade zones make it a destination GDP/Capita (USD) $8,040.24
projected by the second half and anticipated through 2012
for foreign firms to locate new projects in Mexico. The long- and beyond.
term outlook is extremely favorable through 2010 and
beyond.
Rate (%) Rate (%)
San Luis Potosi At A Glance Tijuana At A Glance

RENT/SF/YEAR RENT/SF/YR
Low High Effective Average Vacancy Low High Effective Avg. Vacancy
New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 20.00 $ 30.00 $ 25.00 40.0%
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 N/A N/A N/A N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 12.84 $ 23.88 $ 18.33 10.0% Downtown N/A N/A N/A N/A
Community Power Center N/A N/A N/A 7.0% Community Power Center N/A N/A N/A N/A
Regional Malls $ 15.72 $ 33.60 $ 24.72 5.0% Regional Malls $ 16.00 $ 50.16 $ 33.10 6.0%
DEVELOPMENT LAND Low/M2 High/M2 DEVELOPMENT LAND Low/SF High/SF

Office in CBD $ 300.00 $ 1,000.00 Office in CBD $ 43.00 $ 1,500.00
Land in Office Parks N/A N/A Land in Office Parks N/A N/A
Office/Industrial Land - Non-park $ 216.60 $ 658.84 Office/Industrial Land - Non-park $ 50.00 $ 130.00
Retail/Commercial Land $ 315.88 $ 1,263.53 Retail/Commercial Land $ 30.00 $ 1,500.00
Residential $ 361.01 $ 496.38 Residential $ 80.00 $ 450.00

Torreon, Coahulia, Mexico Caracas, Venezuela
Torreon is situated in a unique region of Mexico known as Venezuela offers excellent opportunities for investment due
La Laguna. This region is located in north central Mexico, to extraordinary oil revenues. Although oil prices went from
between the limits of Coahuila and Durango States. This US $147 to US $78 (Oct. 20, 2009), oil revenues are still an
area called “La Laguna” has a population of approximately important commodity. The level of Venezuela cash reserves
1.3 million people and is host to 20 of the Fortune 500 at the beginning of the economic crisis allowed that macro-
companies from various sectors. This region is sustained in economic imbalances did not translate into a severe
part by the apparel, automotive and educational sectors. contraction in the market. The oil sector and oil related
Automotive firms include John Deere, Takata, Delphi, JCI, industries are the key drivers of the Venezuela economy.
Linar, Alcoa, Sumitomo, Cooper and Metzler. Metal fabricators The office market in Caracas, mostly dependent on foreign
include Lincoln Electric, Caterpillar and Superior Essex, while companies, has become thin. Sale and rental prices
the major textile firms are Parras, RKI, Wrangler, Libra, and increased due to very low inventory, while construction of
Lajat Denim. The seven regional industrial parks in the new projects started but only a few have entered the market
area are Amistad, Ferropuerto Laguna, Jumbo Plaza, in 2009; more projects will be finished in 2010, which will not
Las Americas, Lagunero, Matamoros Industrial Park, San be enough to catch up with demand for Class AAA offices.
Pedro and Oriente Industrial Park. The industrial real estate market has also seen low inventory
Contact 2009 reflected the same fall in demand and consolidation Contact levels in 2009 with rental and sale prices above 2008 levels.
in Torreon as the rest of the Mexican industrial markets. It is expected that this trend will continue in 2010 due to an
NAI Mexico (Baja) NAI Ferca
More demand is anticipated to occur in 2010 due to increase in oil revenue and plans from the Chavez adminis-
+619 690 3029 +58 212 286 8124
projected expansions from existing operations. During 2009, tration to reduce unemployment through development of the
industrial lease rates fell 10-15% for Class B and C facilities. manufacturing, construction and agricultural sectors. Retail
During 2010, tenants will experience a “tenants’ market” has also seen low inventory and increased prices. Vacancy
and should receive additional incentives for free rent and rates at Class AAA shopping centers are extremely low. The
time to retrofit space. Industrial land values remained retail sector has benefited from the government policy of
consistent during 2009 with no change expected for 2010. increasing consumption of the lower income population,
No new Industrial parks are under development. which increased the demand of retail outlets.
During 2009, there were no changes in rates or prices in the Investment in real estate among transnational companies
Country Data office sector. Torreon offers few high-rise buildings with most Country Data has improved as many companies use this type of invest-
offices in the market housed in smaller, two or three-story ment to hedge their Bolívar cash balances against inflation.
Area 1,972,550
projects. In the retail sector, only five small strip centers were Due to the exchange control system in force since 2006,
Area 912,050
launched during 2009. This trend will continue in 2010 with repatriation of dividends at an official exchange rate of US
only a few additional projects expected to be delivered to the $1 = Bs. 2.15 is very difficult leaving many companies to
market. SORIANA, one of the biggest supermarket retailers invest their Bolívar cash surplus in offices/warehouses.
in Mexico, is based out of Torreon. Venezuela has the biggest oil reserves in the world, a
GDP 2008 (US$ B) $866.34 GDP 2008 (US$ B) $353.47
Torreon’s unique location on the trade corridor to Texas, its commodity that will continue to be key to the world
strong industrial tradition and its ability to ship overnight to economy. Due to its foreign exchange reserves, it is
much of the US make it a destination for foreign firms to estimated that Venezuela will be able to cope with any
locate new projects in Mexico. The Torreon market looks to temporary variation of oil prices.
be very encouraging in 2010 and beyond.
Rate (%) Rate (%)
Torreon At A Glance San Jose At A Glance

RENT/SF/YR Conversion: 2.15 Bs. = 1 US$ RENT/M2/MO US$ RENT/SF/YR
Low High Effective Avg. Vacancy Low High Low High Vacancy
New Construction (AAA) $ 10.25 $ 21.57 $ 16.20 10.0% New Construction (AAA) Bs. 240.00 Bs. 350.00 $ 10.37 $ 15.12 1.8%
Class A (Prime) $ 10.25 $ 18.84 $ 13.37 9.0% Class A (Prime) Bs. 163.00 Bs. 220.00 $ 7.04 $ 9.51 0.6%
Class B (Secondary) $ 5.40 $ 12.96 $ 8.64 9.0% Class B (Secondary) Bs. 137.00 Bs. 190.00 $ 7.04 $ 9.51 2.3%
New Construction (AAA) $ 16.72 $ 22.29 $ 16.72 11.0% New Construction (AAA) N/A N/A N/A N/A N/A
Class A (Prime) 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 Class B (Secondary) N/A N/A N/A N/A N/A
Bulk Warehouse $ 1.60 $ 2.81 $ 1.93 8.0% Bulk Warehouse Bs. 21.00 Bs. 44.10 $ 0.91 $ 1.91 N/A
Manufacturing $ 2.80 $ 4.00 $ 3.50 4.0% Manufacturing Bs. 9.80 Bs. 23.09 $ 0.42 $ 1.00 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 N/A
RETAIL RETAIL
Downtown $ 5.40 $ 12.97 $ 8.63 5.0% Downtown Bs. 70.00 Bs. 250.00 $ 3.02 $ 10.80 N/A
Neighborhood Service Centers $ 9.72 $ 16.16 $ 12.96 8.0% Neighborhood Service Centers N/A N/A N/A N/A N/A
Community Power Center N/A N/A N/A N/A Community Power Center N/A N/A $ 2.38 $ 3.54 N/A
Regional Malls $ 29.28 $37.84 $ 32.44 10.0% Regional Malls Bs. 55.00 Bs. 82.00 $ 2.38 $ 3.54 N/A
DEVELOPMENT LAND Low/SF High/SF DEVELOPMENT LAND Low/M2 High/M2 Low/SF High/SF
Office in CBD N/A N/A Office in CBD N/A Bs. 6,000.00 N/A $ 2,790.70
Land in Office Parks N/A N/A Land in Office Parks N/A N/A N/A N/A
Land in Industrial Parks $ 1.75 $ 4.36 Land in Industrial Parks N/A N/A N/A N/A
Office/Industrial Land - Non-park $ 3.20 $ 4.84 Office/Industrial Land - Non-park N/A N/A N/A N/A
Retail/Commercial Land $ 16.00 $ 28.00 Retail/Commercial Land N/A N/A N/A N/A
Residential $ 7.00 $ 30.00 Residential Bs. 210.00 Bs. 2,800.00 $ 97.67 $ 1,302.33

United States
SECTION CONTENTS
Birmingham, AL Boise, ID Manchester, NH Schuylkill County, PA
Huntsville, AL Southeast Idaho (Idaho Falls/Pocatello) Portsmouth, NH Wilkes-Barre, PA
Mobile, AL Chicago, IL Atlantic County, NJ Columbia, SC
Phoenix, AZ Springfield, IL Middlesex/Somerset Counties, NJ Greenville/Spartanburg/
Jonesboro, AR Fort Wayne, IN Northern, NJ Anderson Counties, SC
Little Rock, AR Indianapolis, IN Ocean County, NJ Sioux Falls, SD
Inland Empire, CA Cedar Rapids, Iowa City, IA Princeton, NJ Chattanooga, TN
Los Angeles, CA Davenport, Bettendorf IA Southern, NJ Clarksville, TN
Marin County, CA and Rock Island, Moline, IL Albuquerque, NM Knoxville, TN
Monterey County, CA Des Moines, IA Las Cruces, NM Memphis, TN
Oakland, CA Sioux City IA Albany, NY Nashville, TN
Orange Couny, CA Wichita, KS Long Island, NY Austin, TX
Sacramento, CA Lexington, KY New York, NY Beaumont, TX
San Diego, CA Louisville, KY Asheville, NC Corpus Christi, TX
San Francisco County, CA Batten Rouge, LA Charlotte, NC Dallas, TX
San Mateo County, CA Monroe, LA Greensboro, NC Houston, TX
Santa Clara County, CA New Orleans, LA Raleigh, NC El Paso, TX
Santa Cruz County, CA Greater Portland, ME Fargo, ND Fort Worth, TX
Sonoma County, CA Baltimore, MD Akron, OH Rio Grande Valley, TX
Ventura County, CA Suburban Maryland, MD Canton, OH San Antonio, TX
Colorado Springs, CO Boston, MA Cincinnati, OH Texarkana, TX
Denver, CO Western (Greater Springfield), MA Cleveland, OH Salt Lake City, UT
Delaware & Cecil County, Maryland Detroit, MI Columbus, OH Washington County, UT
Washington D.C. Grand Rapids, MI Dayton, OH Burlington, VT
Fort Lauderdale, FL Lansing, MI Oklahoma City, OK Northern Virginia, VA
Ft. Myers, FL Minneapolis/St. Pau, MN Tulsa, OK Seattle/Puget Sound, WA
Jacksonville, FL Kansas City, MO Portland, OR Spokane, WA
Martin & St. Lucie Counties, FL St. Louis, MO Allentown, PA Tri-Cities WA
Miami, FL Bozeman, MT Berks County, PA Madison, WI
Orlando, FL Missoula, MT Bucks County, PA Milwaukee, WI
Palm Beach, FL Lincoln, NE Harrisburg/York/Lebanaon, PA Northeastern (Fox Valley/Green Bay), WI
Tampa Bay, FL Omaha, NE Lancaster, PA Casper, WY
Atlanta, GA Las Vegas, NV Philadelphia, PA Jackson Hole, WY
Honolulu, HI Reno, NV Pittsburgh, PA
Birmingham, Alabama Huntsville, Decatur County, Alabama
Birmingham is Alabama’s largest metropolitan area and one The Huntsville/Madison County commercial real estate market
of the largest urban regions in the South. This area has a continues to remain stable throughout the first three
diverse workforce of over 900,000 and a thriving economic quarters of 2009. Although the local economy remains in
base, including a mixture of corporate headquarters, biotech- recession, the jobs Huntsville will gain from Base Realign-
related industries, operations centers, distribution facilities ment and Closure (BRAC) consolidation will lift the city out
and automotive manufacturing and related suppliers. of the nationwide recession before the rest of the country.
Most sectors of Birmingham’s commercial market showed The Huntsville/Madison County community once again led
continued signs of contraction in 2009 with rental rates Alabama in both population growth and the new and
and occupancies declining. Negative absorption for the expanding job markets.
multi-tenant markets also continued, though there was The Huntsville/Decatur office market has remained stable in
some absorption in freestanding industrial buildings and the 2009. Absorption of office space has slowed, but continued
service-center sector. There has been little new product defense spending has allowed several companies to build
brought to the market due to the credit freeze, although a new buildings in 2009. The office market should remain
few office developments were under construction based on stable with slower growth for the next two years sustained
previous commitments. by the planned growth due the BRAC realignment. Rental
The Birmingham office market overall, saw a direct rates in the office market have remained consistent at
Contact Contact $17.75-$25/SF for Class A space and $13 -$17/SF
negative absorption of 62,897 SF during Q2 and an
NAI Chase Commercial NAI Chase Commercial for Class B. New construction completed in 2009 has kept
occupancy rate of 91.6%, a slight decrease from 92% at
Realty, Inc. RE Services, Inc. vacancy rates higher at an 11% average. Office vacancy
the end of Q1. The Birmingham office market continues to
+1 888 539 1686 +1 888 539 1686 rates should begin to decrease by year’s end. Much of the
see negative absorption each quarter, however the gap is
narrowing. The CBD showed positive activity in Class A vacant space should be absorbed by the end of 2010.
space adding 10,000 SF to overall occupancy in Q3. The Overall, the 2010 forecast for office remains stable.
midtown market continues to demonstrate strength with an Huntsville’s industrial market is currently seeing vacancy in
overall occupancy of 95%. excess of 9%. The market is reacting by providing additional
Retail has also experienced a slide in occupancy due to the concessions and reduced rent, but vacancy is expected to
economy. Economic conditions have had the most inch higher during the first half of 2010.
Metropolitan Area
effect on the retail sector. Retail development has also Metropolitan Area The retail market has experienced anemic performance due
slowed dramatically. Homewood, Mountain Brook and to the economic downturn. More vacancies are increasing in
Economic Overview Vestavia maintain the highest occupancy for retail with a Economic Overview big block space and niche shopping centers. The Huntsville
2009 year-to-date level of 91%. However, it too has experienced 200 retail market ended 2008 with a 12% vacancy rate. Vacancy
Population 1,105,506 negative absorption of 7,000 SF for the year. Population 402,764 rates have continued to rise in 2009. Construction starts
The Birmingham industrial market experienced a negative came to a near halt during 2009. To combat low absorption
2014 Estimated 2014 Estimated
absorption of 126,262 SF in Q2. The overall occupancy rate Population 441,760 and the decline in retail activity, landlords have begun
Population 1,191,674
was 81.4%, a decrease from 83.2% in Q1. Despite a lowering rental rates and offering more concessions.
Employment Employment
negative absorption of 18,906 SF for the quarter, the 193,101
Huntsville remains the shining star of the state of Alabama
Population 569,945 Population
midtown submarket continues to demonstrate strength with with national recognition and rankings. The Huntsville/Madison
Household the highest occupancy rate in the market of 95.8% and an Household County community has received unprecedented rankings
Average Income $65,470 occupancy rate of 97.1% in Class A space. Average Income $64,222 and recognition for job growth, technology and quality of life.
In 2009, it received its most lofty ranking yet when it was
Median Median
Household Income $48,949 Household Income $55,903
named by Kiplinger as the number one city in the US.
Total Population Total Population

38
Median Age 37.95 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
Class B (Secondary) $ 13.00 $ 17.50 $1 6.48 13.0% Class B (Secondary) $ 14.00 $ 17.00 $ 15.00 12.0%
New Construction (AAA) $ 23.00 $ 28.00 $ 27.00 N/A New Construction (AAA) $ 19.00 $ 25.00 N/A 25.0%
Class B (Secondary) $ 13.50 $1 8.00 $ 15.75 12.5% Class B (Secondary) $ 13.00 $ 17.00 $ 15.00 12.0%
Bulk Warehouse $ 2.80 $4.54 $ 3.58 19.0% Bulk Warehouse $ 2.00 $ 3.50 $ 3.00 9.0%
Manufacturing $ 2.00 $4.00 $ 3.20 16.0% Manufacturing $ 3.00 $ 5.00 $ 3.75 15.0%
High Tech/R&D $ 9.00 $12.00 $ 9.25 12.0% High Tech/R&D $ 8.00 $ 10.00 $ 9.25 12.0%
RETAIL RETAIL
Community Power Center $ 9.00 $ 17.00 $ 11.00 12.0% Community Power Center $ 8.00 $ 10.00 $ 7.00 10.0%
Regional Malls $ 18.00 $ 35.00 $1 9.00 13.0% Regional Malls $ 20.00 $ 60.00 $ 30.00 8.0%
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
While somewhat resistant to the recessionary pressures The Phoenix commercial real estate market is experiencing
in 2008, the Mobile area definitely experienced a major its most difficult challenges since the early 1990s.
slowdown in 2009. Despite the current downward economic Impacted by the continuing increase in unemployment, the
trends in the area, Mobile is noted as a leader for ship demand for space has been stymied by uncertainty and
building,aerospace and medical research within the state of corporate contraction. After ranking second in population
Alabama. Mobile remains a global player with its deepwater growth in the US for 25 years, Arizona has fallen to 49th
port currently ranked in the top 10 with regard to bulk and and is experiencing negative job growth due to the loss of
container handling. thousands of construction related jobs.
The office sector shows a slight decrease in absorption from The office vacancy rate is at 25% overall. Due to the
2008, with very little Class A space available. Rents overbuilding of new office space that is delivered but not yet
remained stable with an overall 10% vacancy. Class B space occupied, vacancy of office space in the downtown and
is experiencing a 20% vacancy with ample sublease oppor- some suburban submarkets has reached a staggering 60%
tunities. There is no new construction at the present time. vacancy rate. Asking rates are just over $26/SF for Class A
The industrial market has realized a substantial increase office space. Effective rates on completed new leases are at
in vacancy during 2009. Vacancy levels are approaching $23/SF. The market is experiencing negative net absorption
approximately 25%. Mobile is fortunate to have the nearly that will be compounded with the delivery of over 2 million
Contact Contact SF currently under construction.
completed Thyssen-Krupp Steel Mill in its northern sector
NAI Heggeman Realty NAI Horizon
scheduled to open in mid 2010 with a capital investment Industrial vacancy stands at nearly 17% with negative net
Company, Inc +1 602 955 4000
of roughly $4.5 billion. Mobile Container Terminal located absorption of just over 6 million SF in 2009. Achieved rental
+1 251 479 8606
on the deepwater port, continues to expand despite rates have declined 15-18% year over year. With the delivery
the economic climate. General cargo and bulk activity of another 2.2 million SF over the next three quarters,
remain below average at the port due to the trends in the vacancy will undoubtedly increase and rental rates will
global market. continue to erode.
The retail sector continues to soften and is very reflective of Retail landlords have been the most aggressive with rental
the trend nationwide. There is virtually no new construction rates and concessions for both new and existing tenants. In
under way in either Mobile or Baldwin County. Retail rents spite of those efforts, overall vacancy has risen from 10.3%
Metropolitan Area are flat with many national tenants renegotiating early Metropolitan Area
at the beginning of 2009 to the current level of 11%. New
renewals at lower rates. The lending environment continues construction has exacerbated the problem with 2.8 million
Economic Overview Economic Overview
to challenge developers for permanent financing to close SF added to the base over the past four quarters. Another
2009 deals. Virtually no “big box” projects are under way at the 2009 1 million SF is currently under construction and due to be
Population 401,171 present time. Surprisingly, the multifamily market in Population 4,456,884 delivered over the next three quarters. As the economy con-
Mobile/Baldwin remains steady with approximately 3,000 tinues to struggle and new product is completed and deliv-
Population 393,638
units under construction. The multifamily market is one of 5,149,033
ered, vacancy rates can be expected to climb another 3-5%.
Population
the few real estate products that remain favorable in the Today’s market offers opportunities with upside potential
Employment capital markets with permanent financing available. Employment for tenants and investors. More opportunities are expected
Population 199,986 Population 1,852,413
Overall expectations for 2010 remain unclear. In the event as foreclosure looms for properties not measuring up to their
Household that Northrop Grumman/Airbus is awarded a major contract Household purchase pro formas. Prosperity will return to the Phoenix
Average Income $48,705 to manufacture aircraft for the US Air Force in Mobile, every Average Income $71,428 market once positive growth is realized through increased
sector of the market would feel a direct surge in activity with consumer confidence, job growth and access to credit
Median Median
Household Income $43,051 major growth returning. Household Income $58,328
markets.

Median Age 36 Median Age 34
Mobile At A Glance Phoenix At A Glance

New Construction (AAA) $ 20.00 $ 25.00 $ 22.15 N/A New Construction (AAA) $ 28.00 $ 37.00 $ 34.00 60.0%
High Tech/R&D $ 15.00 $ 20.00 $ 17.50 10.0% High Tech/R&D $ 4.50 $ 17.00 $ 8.50 19.0%
RETAIL RETAIL

Office in CBD $ 200,000.00 $ 1,200,000.00 Office in CBD $ 800,000.00 $ 7,500,000.00
Land in Office Parks $ 120,000.00 $ 217,800.00 Land in Office Parks $ 108,000.00 $ 500,000.00
Office/Industrial Land - Non-park $ 40,000.00 $ 261,360.00 Office/Industrial Land - Non-park $ 15,000.00 $ 2,000,000.00
Retail/Commercial Land $ 261,360.00 $ 871,200.00 Retail/Commercial Land $ 10,000.00 $ 8,000,000.00
Residential $ 20,000.00 $ 50,000.00 Residential $ 2,000.00 $ 1,500,000.00

Jonesboro, Arkansas Little Rock, Arkansas
Jonesboro experienced growth in many sectors during Little Rock's growth sectors are medical, government and
2009, including education, medical and industrial. Arkansas institutional. Suburban Little Rock is experiencing a
State University enjoyed record enrollment for the second much slower absorption in retail growth and multifamily
year in a row. Key industries in Jonesboro continue to be development. The SMA has been positively impacted with
retail, industrial, office and education. natural gas exploration (Fayetteville Shale) and wind energy
The industrial sector boomed in 2009 between the related manufacturing. The bedroom communities are also
announcement of Nordex USA’s plan to construct a $100 developing their identities as potential corporate office
million wind-energy plant in the Jonesboro Industrial Park locations.
and Alberto Culver, also located in the Jonesboro Industrial Office market activity is occurring in the bedroom
Park, expanding to allow for even more jobs and production communities of Benton, Maumelle and particularly Conway.
outside of Jonesboro. Startek, an in-bound call center Internal growth is absorbing the second generation office
that fields calls for AT&T customers, had a huge hiring space in the CBD and West Little Rock. With Verizon's
upswing at the beginning of 2009, expanding to well over purchase of Alltel's corporate campus (Midtown) the antic-
600 employees. ipation is this campus will become available. Production
The retail sector contracted in 2009 as shown by the closure facilities for natural gas and wind energy are being
of Steinmart, Steve & Barry’s and Circuit City, but made completed. Food grade production facilities are also
Contact Contact coming online.
progress to regain ground with the arrivals of Olive Garden,
NAI Halsey NAI Dan Robinson
Murphy Oil Convenience Store, Sport Clips for Men, Office There is an abundance of first generation retail space in
+1 870 972 9191 & Associates
Depot, a third Burger King location, and a Best Buy. The place or approved in high income areas or along high
+1 501 224 7500
multifamily market showed a slight upturn with the traffic corridors. City-wide limited infill activity will continue.
construction of The Grove student housing, fully furnished The most prominent infill location is just north of I-630 on
apartments located just off campus from Arkansas State University Ave.
University. The largest announcement of 2009 was that NEA The Little Rock investment market is primarily an owner/user
Baptist Memorial Hospital was approved for construction of market. Fast food facilities tend to be the segment most
a $200 million, 250 bed hospital on the Northeastern side prone to investment activity. However, this activity is moving
of Jonesboro. This has called for area growth and many into the bedroom communities. Multifamily activity has
residential zones being quickly re-zoned to commercial, slowed. Projects are on the drawing board seeking sources
Metropolitan Area which is expected to continue well into 2010. Metropolitan Area
of funding.
Economic Overview Jonesboro saw several significant transactions in 2009 Economic Overview
Time, distance and available infrastructure in close proximity
2009 including the sale of a new office building valued at 2009
to major employment centers have caused developers to
Population 121,875 $1.5 million to Merrill Lynch, the new location of E.C. Population 690,000
redirect their site searchs along the I-430 corridor.
Barton's Surplus Warehouse and the purchase of property Arkansas's favorable tourism industry entices the entrepre-
Population 135,082 for Ritter's corporate campus, an internet, TV, and phone Population 746,933 neurial spirit and restaurants and hotel facilities continue to
provider headquartered here. emerge but at a slower pace in the CBD and suburban
53,430 423,829
markets. There is serious competition for market share.
Population Population
The community of Conway recently announced that it will
Household Household house corporate offices for two major companies, Hewlett
Average Income $52,949 Average Income $60,500
Packard and Southwestern Energy Company. Searcy
Median Median announced the facility expansion of Schulze & Burch Biscuit
Household Income $39,936 Household Income $49,636 Co., a specialty baking company out of Chicago, IL.
35 37
Median Age Median Age
Jonesboro At A Glance Little Rock At A Glance

New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 20.00 $ 24.00 N/A N/A
Class A (Prime) $ 14.00 $ 22.00 $ 12.00 N/A Class A (Prime) $ 17.00 $ 19.50 N/A 10.0%
Class B (Secondary) $ 10.00 $ 16.00 $ 15.00 N/A Class B (Secondary) $ 10.00 $ 14.00 N/A 13.0%
New Construction (AAA) $ 18.00 $ 22.00 $ 18.00 10.0% New Construction (AAA) $ 22.00 $ 24.00 N/A 5.0%
Bulk Warehouse $ 3.00 $ 6.00 $ 3.50 10.0% Bulk Warehouse $ 2.50 $ 5.00 N/A 5.0%
Manufacturing N/A N/A N/A N/A Manufacturing $ 1.50 $ 6.90 N/A 8.0%
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 $ 20.00 $ 14.00 N/A Neighborhood Service Centers $ 20.00 $ 35.00 N/A 40.0%
Community Power Center N/A N/A N/A N/A Community Power Center $ 14.00 $ 30.00 N/A 60.0%
Regional Malls $ 18.00 $ 32.00 $ 25.00 10.0% Regional Malls $ 25.00 $ 40.00 N/A N/A

Office in CBD N/A N/A Office in CBD $ 435,600.00 $ 1,306,800.00
Office/Industrial Land - Non-park $ 5,000.00 $ 15,000.00 Office/Industrial Land - Non-park $ 1.50 $ 261,360.00
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

Inland Empire (Riverside/ San Bernardino), California Los Angeles, California
The Inland Empire has suffered during the recession mainly The entertainment industry, a primary component of the
due to a strong development surge over the last 10 years. market in Los Angeles, has weathered the current crisis
Residential foreclosures have subsided as median home quite well. The October 25th year-to-date box office receipts
prices fell. Lease rates for all types of commercial property increased 7.3% from 2008. Offsetting the gains in enter-
declined, which increased absorption in a double-digit tainment are losses in international trade. Total shipments
vacancy factor environment throughout the commercial through September at the Port of Long Beach decreased
spectrum. 24.6 % from the previous year. In general, economic
The good news is that the Inland Empire has returned to its conditions in Los Angeles County remain weak. However,
historical position as the lower cost alternative to the Los there is a bright spot as discount retailers, such as Big Lots,
Angeles basin. Affordable housing, low cost commercial Dollar Tree, 99 Cents Only, and Wal-Mart, continue to expand.
space, and a strong employee base are likely to encourage Concerns regarding future economic growth have kept
economic growth in the Inland Empire. demand for commercial real estate in Los Angeles County
The office market experienced a significant contraction subdued. Companies throughout Los Angeles are looking
during the recession. Vacancy rates rose to unprecedented for ways to reduce lease expenses. For some, this means
levels over the last two years causing highly aggressive base vacating their existing space. This has led to higher vacancy
rental rates and concession packages to attract the Inland Contact rates for office, retail, and industrial space. Other companies
Contact NAI Capital (Encino) are asking for rent reductions. This, combined with higher
Empire office user. With the exception of malls, retail
NAI Capital +1 818 905 2400 vacancy rates, led to lower lease rates in all three markets.
vacancy rates in the Inland Empire exceed 10%. Although
(Riverside) NAI Capital (West Los Angeles)
high, these rates are likely to remain constant or decrease +1 310 440 8500 Tight credit markets and an unwillingness to lend have
+1 951 346 0800
NAI Capital slightly over the next 12 months. Enticed by low lease rates, NAI Capital (South Bay) negatively impacted the number of sales transactions. The
(Ontario/San Bernardino) discount retailers, who have experienced an increase in sales +1 310 532 9080 number and dollar value of sales transactions declined
+1 909 945 2339 during the recession, are inquiring about additional space. NAI Capital (Commerce) significantly compared with 2008 figures. The velocity of
+1 323 201 3600 sales transactions is expected to increase as owners shift to
NAI Capital The industrial market remains weak due to negative
NAI Capital (Pasadena) SBA financing.
(Temecula Valley) absorption and approximately three years of available +1 626 564 4800
+1 951 491 7590 inventory proliferating throughout the Inland market in NAI Capital (Santa Clarita) Higher vacancy rates, lower lease rates and tight credit have
all size spectrums. The optimistic aspect is that the +1 661 705 3550 almost eliminated new construction. Very little construction
Metropolitan Area gap between buyers and sellers and landlords and tenants took place in Los Angeles County during 2009 and is not
has finally narrowed, which is stimulating transactions. Metropolitan Area likely to pick up in the near future. However, several new
Economic Overview Distressed property owners are moving product lateral construction sites are slated for 2011.
Economic Overview
2009 with the late 1980s market. With prices at a 15-year low, We have experienced a significant decline in lease rates and
Population 4,189,781 opportunity has been created for the investor looking to 2009
Population 12,721,592 sales prices with some categories at lower levels than we
purchase at or below replacement cost. have seen for almost 10 years. However, with the current
2014 Estimated
Population 4,458,827 Private Equity Funds are taking to this market due to the 2014 Estimated increase in activity, some improvement in credit lending and
tremendous upside potential of where they can buy now as the existing low prices in the market, we expect to see a
Employment
1,321,430
opposed to where the product topped out during the height Employment significant increase in lease and sale transactions in the next
Population
of the market. Population 5,950,383 12 months.
Household
Average Income $74,095 Household
Average Income $82,944
Median
Household Income $55,131 Median
Household Income $57,887
Total Population
32 Total Population
Median Age 35
Median Age
Inland Empire (Riverside/ San Bernardino) At A Glance Los Angeles At A Glance

Class A (Prime) N/A N/A N/A N/A Class A (Prime) $ 18.00 $ 52.54 $ 34.19 13.7%
Class B (Secondary) N/A N/A N/A N/A Class B (Secondary) $ 9.81 $ 44.35 $ 21.74 12.2%
SUBURBAN OFFICE DOWNTOWN OFFICE
RETAIL RETAIL
Downtown N/A N/A N/A N/A Downtown $ 7.08 $ 45.24 $ 32.61 4.6%
Sub Regional Centers $ 4.80 $ 47.24 $ 26.25 11.4% Community Power Center $ 3.24 $ 37.00 $ 23.85 7.6%
DEVELOPMENT LAND Low High DEVELOPMENT LAND Low/Acre High/Acre

Office in CBD N/A N/A Office in CBD $ 4,375,000.00 $ 10,937,500.00
Land in Office Parks $ 881,928.00 $ 1,033,057.00 Land in Office Parks $ 1,066,666.00 $ 3,849,206.00
Land in Industrial Parks $ 153,932.00 $ 653,400.00 Land in Industrial Parks $ 1,034,031.00 $ 3,120,000.00
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park N/A N/A
Retail/Commercial Land $ 403,846.00 $ 1,520,270.00 Retail/Commercial Land $ 1,306,801.00 $ 3,975,000.00
Residential (per acre) N/A N/A Residential N/A N/A

Marin County, California Monterey, California
Marin County, bordered by the San Francisco Bay, the Pacific Monterey County’s major economic generators are agriculture
Ocean and the vineyards of Sonoma Valley, is considered and tourism. The Monterey Peninsula, home to Pebble
one of the most affluent counties in the nation. Located just Beach, Cannery Row and the Monterey Bay Aquarium, is
north of San Francisco’s Golden Gate Bridge, Marin, home heavily dependent on tourism. The Salinas Valley is one of
to Mt. Tamalpais, has an excellent climate, lavish open space the state’s most significant agricultural regions producing a
and spectacular views. variety of lettuces, strawberries, grapes and other products.
Marin County office vacancy peaked above 16.8% in 2003, Vacancy numbers rose across the board from Q3 2008 to
but has since increased to 21.1% by Q3 2009. Vacancy Q3 2009; Class A office vacancy countywide increased from
increased 570 basis points since Q3 2008. The average 9.3% in Q3 2008 to approximately 13.1% in Q3 2009,
asking rate decreased a substantial $2.52/SF in the past while Class B office vacancy rose from 5.1% to 7.8% during
year to $30.72/SF full service per year. Since 2004, nearly the same period. Average rents for Class A office remained
5 million SF of available office space has been absorbed steady, rising from $27.96/SF to $28.20/SF while Class B
from the county’s marketplace. office saw a decrease from $23.40/SF to $22.80/SF.
A rare occurrence, the City of San Rafael vacancy, at 27.3% Industrial vacancy rose from 4.4% in Q3 2008 to 8.2% in
in Q3 2009 compared to 17.7% a year ago, is higher Q3 2009 and posted an average rent of $5.64/SF.
Contact compared to its northern counterpart, Novato. This vacancy Contact Water use remains a driving force behind the current state
increase is due to the completion of the second phase of of future growth as the Monterey Peninsula looks for an al-
NAI Global NAI Global
the San Rafael Corporate Center bringing 160,000 SF of ternative water source other than the Carmel River. Currently
+1 609 945 4000 +1 609 945 4000
new construction to the market. the PUC is considering three solutions for a desalination
In Southern Marin, the overall average asking rate in Q3 plant in the area: the proposed Cal-Am desalinization plant
2009 decreased $0.52/SF to $3.19/SF full service in Moss Landing, another proposed Cal-Am desalinization
compared to a year ago. This part of the county holds the plant in Marina, and the Regional Water Project, also located
highest average asking rates that shelters many of the in Marina. In the Salinas Valley, efforts to combat saltwater
county’s successful financial firms. intrusion have proceeded well. The Monterey County Water
Resources Agency is in the process of completing a project
Commercial sale activity experienced a stalemate during that includes modifications to the Nacimiento Dam spillway
2009. The largest transaction in the county closed at the and the installation of a rubber dam and diversion facility on
Metropolitan Area beginning of the year as Inland Western Larkspur LLC sold Metropolitan Area the Salinas River near Marina.
Economic Overview its 172,443 SF shopping center to JS Rosenfield & Co. Economic Overview
Other sale activity includes MEPT, a pension fund selling 55, Most new development will continue to be focused on the
2009
75 & 88 Rowland Way in Novato, totaling 168,072 SF, to 2009 former Fort Ord and Salinas Valley. Additional development
Population 246,713
Barker Pacific Group and Rockwood Capital.
Population 402,398 on the Monterey Peninsula will be limited by water availability
and local politics.
2014 Estimated Investment activity remained quiet for 2009. We anticipate 2014 Estimated
Population 243,128 Population 4389,312
continued softening in values as capitalization rates rise to
Employment accommodate perceived risks. The Marin market is relatively Employment
Population 132,909 stable due to the high barriers of entry for new development, Population 184,867
the active small tenant population and relatively lower use
Household of debt. Household
Median Median

Median Age 45 Median Age 32.9
Marin County At A Glance Monterey 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
Class B (Secondary) N/A N/A N/A N/A Class B (Secondary) N/A N/A N/A N/A
Bulk Warehouse $ 12.00 $ 15.60 $ 13.80 N/A Bulk Warehouse N/A N/A N/A N/A
Manufacturing $ 12.00 $ 15.60 $ 13.80 N/A Manufacturing $ 3.00 $ 17.76 $ 5.64 8.2%
High Tech/R&D $ 15.00 $ 20.10 $ 20.10 N/A High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Neighborhood Service Centers $ 15.00 $ 45.00 $ 21.29 8.1% Neighborhood Service Centers N/A N/A N/A N/A
Regional Malls N/A N/A N/A N/A Regional Malls N/A N/A N/A N/A
DEVELOPMENT LAND Low High DEVELOPMENT LAND Low High

Office in CBD (per buildable acre) N/A N/A Office in CBD (per buildable acre) $ 15.00 $ 40.00
Land in Office Parks (per acre) $ 1,306,800.00 $ 1,742,400.00 Land in Office Parks (per acre) $ 261,360.00 $ 609,840.00
Land in Industrial Parks (per acre) $ 871,200.00 $ 1,306,800.00 Land in Industrial Parks (per acre) $ 174,240.00 $ 609,840.00
Office/Industrial Land - Non-park (per acre) $ 871,200.00 $ 1,306,800.00 Office/Industrial Land - Non-park (per acre) $ 261,360.00 $ 1,524,600.00
Retail/Commercial Land (per acre) $ 1,524,600.00 $ 1,960,200.00 Retail/Commercial Land (per acre) $ 435,600.00 $ 1,742,400.00
Residential (per acre) $ 2,395,800.00 $ 2,831,400.00 Residential (per acre) N/A N/A

Oakland, California Orange County, California
The East Bay office market has risen to a 17.7% vacancy, The Orange County office, retail and industrial markets have
a 3.2% increase since Q3 2008. Vacancy had steadily begun to recover from the last two years of economic slow
remained around 14% since Q3 2005 until this year when down. The Orange County market was particularly hard
vacancy climbed each successive quarter to its current level. hit during the recession due to the downfall of the national
The average asking rate decreased $2.28 in the past year sub-prime lenders headquartered in Orange County, the
to $25.92/SF per year for full-service properties. construction of 4 million SF of Class A office projects and
The “core” East Bay office market accounts for a total building unemployment rising from 3.5% to 9.5%.
base of 21 million SF. Vacancy is at 14.3% and the average The good news is that the worst is likely over in Orange
asking rate is $27.12/SF per year for full-service properties. County. Many existing companies are beginning to lock
R&D vacancy continues to hover above 20%, climbing from in long term leases at rates that are the lowest in 10 years.
20.6% in Q3 2008 to 23.1% in Q3 2009. The average Conditions may deteriorate further but not to the extent
asking rate has dropped from $13.28/SF in Q3 2008 to witnessed over the last 24 months. Although leasing activity
$11.22/SF NNN. Year-to-date 2009, the R&D market has has been driven primarily by existing companies renewing
recorded over 3 million SF of gross absorption, an improve- their leases early, the Orange County market has been
ment over 2008, which totaled less than 3.5 million SF. one of the most active in the US, according to real estate
Manufacturing vacancy closed Q3 2009 at 7.6%, up from information provided by CoStar. We are beginning to see a
Contact Contact migration from low rise to Class A high rise space as tenants
5.2% in Q3 2008. The average asking rate fell from $6.83
NAI Global NAI Capital take advantage of lower lease rates.
to $6.00/SF per year NNN during the same time span.
+1 609 945 4000 +1 949 854 6600
Year-to-date 2009, the manufacturing market has amassed Orange County retail markets have fared well. Vacancy rates
over 4.7 million SF in gross absorption, which is already have crept above 5% while lease rates declined only 1%
greater than 2008’s total gross absorption of 4.6 million SF. from last year. These trends may continue as consumers
The retail shopping centers market ended mid-year 2009 continue to cut spending in favor of savings. However, a
with vacancy climbing and asking rates steadily dropping. weak dollar combined with economic growth in Asia, is likely
Vacancy was 7.2% on gross leasable area of 25 million SF to boost tourism in Orange County. Increased tourism will
with the average asking rate $24.83/SF NNN. help to offset weak domestic retail spending.
Metropolitan Area The Orange County industrial market experienced a contraction
Investment activity has been steady through Q3 2009.
Economic Overview HRPT properties secured the largest sale of 2009 with the during the recession. Vacancy rates rose above 10% in two of
Metropolitan Area
2009 purchase of TMG/JER’s Bayside Business Park in Fremont the markets tracked. On average, lease rates declined 4.1%
Economic Overview from Q3 2008 levels. Due to these conditions, construction
Population 4,249,644 with the four-building portfolio measuring 392,488 SF of
R&D space. 2009 activity came to a halt. While this is certainly a negative, it is
2014 Estimated Population 2,985,498 the first step for recovery in the market. At the moment, overall
Population 4,362,644 Many large construction projects have been put on hold capacity is capped at current levels.
due to the poor economic forecast. Earlier this year, Ellis 2014 Estimated
Employment
Partners completed their 110,000 SF office/retail building Population 2,956,048 As economic conditions improve, low lease rates are likely
Population 2,274,988 to entice new entrants into the market. With capacity
in Jack London Square; however, the building is currently Employment
Household 100% vacant. capped, vacancy rates will decline. Lease rates will increase
Average Income $100,489 as the market eventually tightens.
Household
Median Average Income $98,346
Median
Total Population Household Income $75,638
Median Age 40
Total Population
Median Age 36.5
Oakland At A Glance Orange County At A Glance

RETAIL RETAIL
Regional Malls N/A N/A N/A N/A Regional Malls $ 18.61 $ 51.00 $ 26.11 3.6%

Land in Office Parks N/A N/A Land in Office Parks) $ 1,392,857.00 $ 2,333,333.00
Land in Industrial Parks N/A N/A Land in Industrial Parks $ 1,286,434.00 $ 2,000,000.00
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 $ 1,200,000.00 $ 3,076,923.00
Residential N/A N/A Residential N/A N/A

Sacramento, California San Diego, California
Located in the north-central region of California, the Sacramento The San Diego County commercial real estate market has
Valley has benefited from the migration of Bay Area compa- softened significantly during the past year, but with a glim-
nies seeking high quality facilities, affordable rental rates and mer of positive indications towards Q4 2010. Overall, rental
lower employment costs. Additionally, the Sacramento Valley rates, occupancy rates and new construction have trended
market is accessible to major thoroughfares (I-80, US-50, I- downward, as has net absorption in retail and industrial
5 and Highway 99). The Port of Sacramento is an inland port properties. But positive net absorption of almost 300,000
that handles mainly agricultural commodities. SF of office space in Q3 provided some welcome positive
Sacramento Valley office vacancy closed Q3 2009 at 17.2%, news in an otherwise very difficult year.
more than a 300 basis point increase from a year ago. Total At the end of Q3 2009, office vacancy rates were 15.3%,
availability grew 2.8 million SF during this time to 13.7 retail vacancy rates 5.1% and industrial vacancy was 10.9%.
million SF. A substantial amount of new construction has Both retail and industrial properties experienced substantial
played a key role in the vacancy/availability increase. The net negative absorption, approximately 1.5 million SF and
average asking rate was $23.76/SF full service, a sizable 3.75 million SF, respectively, resulting in reduced asking rental
decrease of $3.36/SF, or 12%, from a year ago. The market rates across all product types.
continues to remain favorable for tenants as landlords offer Investment sales and owner user sales have continued to be
rental rate discounts plus other concessions such as free slow compared with sales from two to four years ago, as
Contact rent and higher TI allowance dollars. Lease terms also Contact
the credit environment has remained challenging. Loan to
NAI Global remain shorter, typically ranging between one and two years. NAI San Diego
value ratios have decreased to 50-60% of appraised values,
+1 609 945 4000 +1 619 497 2255
The R&D/manufacturing/warehouse market ended Q3 2009 increasing equity requirements substantially, with the
with a vacancy of 10.4%. Total availability in the industrial exception of SBA financing. Owner users are waiting on the
market was 14.5 million SF, composed predominantly of sidelines for prices to drop further, leading to fewer SBA
direct space accounting for 92% of the total. Sublease financed transactions.
space increased nearly 700,000 SF in Q3 2009 alone, to Among the largest office lease signings this year is the law
more than 1.15 million SF. This surge was mainly attributed firm Procopio, Cory, Hargreaves & Savitch downtown for
to Optisolar’s massive industrial facility hitting the market. 102,000 SF, eBioscience for 49,000 SF in North City and the
The average industrial asking rate was $4.56/SF NNN, down Department of Homeland Security for 45,000 SF. Industrial
$0.84, or 15% from a year ago. leases include 200,000 SF by MOR Furniture and 129,000
Metropolitan Area Metropolitan Area
Office construction continued to trickle on to the market during SF by FedEx Ground, both in Otay Mesa near the Mexico
Economic Overview Q3 as projects that were funded over a year or two ago are Economic Overview Border. The largest sale was the 175,000 SF office building
2009 just now being completed. The development pipeline, how- 2009 purchased by Kaiser Permanente for approximately $52
Population 2,138,182 ever, is quickly tightening as today’s developers wait on the Population 3,040,388 million, just under $300/SF. Excluding small buildings (under
sidelines until market conditions become favorable again. 15,000 SF), six office buildings totaling $61 million sold in
Population 2,255,358 3,202,143
the first half of 2009 for an average of $140/SF, down from
Population
an average price of $230/SF in 2008.
944,031 1,460,337
Sales activity for 2009 has been especially slow due to the
combined forces of the aforementioned credit tightening and
Household Household buyer reluctance. Continued downward pressure from prices
Average Income $75,478 Average Income $81,825 is forecast for 2010 as concessions and capitalization rates
rise, rents decline, CMBS loans mature and refinancing
Median Median
becomes problematic.

Median Age 35 35
Median Age
Sacramento At A Glance San Diego At A Glance

New Construction (AAA) $ 23.40 $ 32.40 $ 27.36 49.1% New Construction (AAA) $ 30.00 $ 33.00 $ 31.50 N/A
Industrial & Warehouse N/A N/A $ 4.56 10.4% Bulk Warehouse $ 4.68 $ 12.00 $ 8.34 9.40%
RETAIL Manufacturing $ 4.80 $ 18.00 $ 9.24 10.90%
Downtown $ 7.20 $ 34.20 $ 20.40 2.8% High Tech/R&D $ 9.00 $ 14.40 $ 9.00 16.20%
Neighborhood Service Centers $ 6.60 $ 37.44 $ 18.36 12.9% RETAIL
Community Power Center $ 15.48 $ 37.56 $ 24.48 7.1% Downtown $ 21.18 $ 60.00 $ 33.33 6.60%
Regional Malls $ 21.00 $ 36.00 $ 27.00 26.8% Neighborhood Service Centers $ 12.00 $ 36.00 $ 23.00 7.10%
Community Power Center $ 20.00 $ 28.00 $ 28.07 5.80%
DEVELOPMENT LAND Low High Regional Malls $ 30.00 $ 44.47 $ 38.50 1.80%
Office in CBD (per buildable acre) N/A N/A
Land in Office Parks (per acre) $ 217,800.00 $ 435,600.00 DEVELOPMENT LAND Low/Acre High/Acre
Land in Industrial Parks (per acre) $ 130,680.00 $ 348,480.00 Office in CBD $ 4,356,000.00 $13,000,000.00
Office/Industrial Land - Non-park (per acre) $ 87,120.00 $ 217,800.00 Land in Office Parks N/A N/A
Retail/Commercial Land (per acre) $ 174,240.00 $ 522,720.00 Land in Industrial Parks $ 436,500.00 $ 1,000,000.00
Residential (per acre) N/A N/A Office/Industrial Land - Non-park $ 436,500.00 $ 1,300,000.00
Retail/Commercial Land $ 871,200.00 $ 2,000,000.00
Residential $ 100,000.00 $ 4,000,000.00

San Francisco County, California San Mateo County, California
The San Francisco commercial market remained plagued by San Mateo County is home to the San Francisco Interna-
rising vacancy, declining rents and occupancy loss with the tional Airport and some of the world’s leading technology
September 2009 preliminary unemployment rate reaching companies. World-class universities, world-class cultural
10.4%. The market-wide vacancy rate rose to 15.3% at the venues, a diverse labor pool and abundant intellectual
end of 3rd quarter 2009. The San Francisco office market resources of working capital make this region one of the
continued to experience deterioration, though at a continu- best locations to conduct business in the United States.
ing lesser pace, despite signs of increased leasing activity
San Mateo office vacancy peaked above 18% in 2009,
as major companies looked to lock in long-term deals and
climbing 680 basis points from 2008. The average asking
take advantage of attractive rents with generous conces-
rate decreased a dramatic $10.32 in the past year to
sions currently offered by Landlords. The market-wide
$31.92/SF per year for full service properties. Since 2007,
vacancy rate rose to 15.3% at the end of 3rd quarter 2009.
nearly 5.7 million SF of office space has been absorbed from
The overall market continued to show occupancy loss
San Mateo County's available marketplace. The city of South
ending Q3 at 247,870 SF of negative net absorption. The
San Francisco’s vacancy rate remained high at 25.7% in
year-to-date total amounted to nearly 1.7 million square feet
Q3 2009 compared to 26.4% a year ago and 13.9% in
of negative absorption, already exceeding 2008’s annual
2007. Belmont/San Carlos also remains among the highest
total of negative 1.3 million square feet. The overall annual
in San Mateo County at 24.9%.
Contact market rental rates dropped $3.75 to $33.01 per square Contact
NAI Global foot full service. NAI Global R&D vacancy continues to increase, closing Q3 2009 at
+1 609 945 4000 +1 609 945 4000
16.11%, an increase of 239 basis points from 2008. The
The amount of sublease space remained flat during the
average asking rate closed Q3 2009 at $27.96/SF NNN per
3rd quarter at about 2.7 million square feet, or 3.2% of
year, down $2.88 from 2008. The County has recorded over
the total building inventory, showing early signs of some
36,000 SF of negative net activity year-to-date in 2009.
companies now shedding less excess space onto the
sublease market and other companies leasing up the Manufacturing vacancy closed Q3 2009 at 4.57% with an
bargain sublease opportunities. average asking rate of $10.68/SF NNN. San Mateo County’s
warehouse vacancy pushed into double-digit territory from
San Francisco’s industrial/warehouse market contains 19.3
5.3% in Q3 2008 to 11.0% in Q3 2009. The average asking
million sf of base and includes users in both distribution and
rate closed Q3 2009 at $9.24/SF NNN. In the past year, the
manufacturing industries. The overall market-wide vacancy
Metropolitan Area Metropolitan Area warehouse market has absorbed 2 million SF of inventory.
rate rose to 5.1% as it lost occupancy at negative 110,500
Economic Overview square feet of net activity. Year-to-date net absorption has Economic Overview Future retail developments include a redevelopment and
already tallied a negative 413,180 square feet, nearly equiv- new construction at 1450 Howard Avenue in Burlingame
2009 2009
Population 4,249,644 alent to its highest amount of annual occupancy loss seen Population 709,558
with a new 44,000 SF Safeway store with an additional
in 2001. Market-wide industrial asking rates dropped lower 13,000 SF of retail space.
2014 Estimated to $0.76 per square foot industrial gross. The market 2014 Estimated
Population 4,362,644 recovery still remains to be seen. The availability rate is Population 715,897
Employment
expected to continue to go up as demand remains slow. Employment
Population 2,274,988 San Francisco’s first quarter 2009 retail vacancy rate was Population 374,088
Household
the lowest in the country at 2 percent, remaining unchanged Household
Average Income $100,489 from year end 2008, and far below the national average of Average Income $116,511
7.2 percent. Average asking rates dropped 4.6 percent to
Median $38.14 per square foot. Of the top metropolitan areas Median
Household Income $77,440 throughout the country, San Francisco’s low vacancy rate is Household Income $89,763
Total Population
reflective of our individual market demand in our supply- Total Population
Median Age 40 constrained urban environment. Median Age 40.8
San Francisco At A Glance San Mateo County At A Glance

Class B (Secondary) $ 18.00 $ 40.00 $2 8.72 13.8% Class B (Secondary) N/A N/A N/A N/A
Manufacturing N/A N/A N/A N/A Manufacturing $ 4.56 $ 18.00 $ 9.24 11.0%
RETAIL RETAIL
Community Power Center N/A N/A N/A N/A Community Power Center $ 15.00 $ 45.00 $ 27.49 5.1%
Regional Malls $ 24.00 $ 150.00 $ 71.37 1.5% Regional Malls N/A N/A N/A N/A
DEVELOPMENT LAND Low High DEVELOPMENT LAND Low High

Office in CBD (per buildableSF) N/A N/A Office in CBD (per buildable acre) $ 111.00 $ 870.00
Land in Office Parks (per acre) N/A N/A Land in Office Parks (per acre) $ 1,500,000.00 $ 2,300,000.00
Land in Industrial Parks (per acre) N/A N/A Land in Industrial Parks (per acre) $ 1,100,000.00 $ 2,645,000.00
Office/Industrial Land - Non-park (per acre) $ 1,700,000.00 $ 6,000,000.00 Office/Industrial Land - Non-park (per acre) $ 1,110,000.00 $ 2,900,000.00
Retail/Commercial Land (per acre) $ 1,800,000.00 $ 10,000,000.00 Retail/Commercial Land (per acre) $ 4,200,000.00 $ 5,500,000.00
Residential (per acre) $ 2,000,000.00 $ 13,000,000.00 Residential (per acre) $ 775,000.00 $ 9,032,000.00

Santa Clara County (Silicon Valley), California Santa Cruz County, California
Santa Clara County has one of the highest median family Santa Cruz County, an area rich in natural beauty, covers
incomes and boasts some of the highest rated educational 439 square miles, making it the second smallest county by
systems nationwide. Many consider this county one of the area in California. With its six state parks, attractive beaches
best places in the country to live and work. This area had been and famous Santa Cruz beach boardwalk, the county
a main target for new office/R&D development in recent years, remains one of the West Coast’s most famous seaside play-
but due to weak demand stemming from economic decline grounds. The economy is still largely dependent on seasonal
and rising unemployment, developers have halted most new tourism and agriculture, but is becoming more diversified
projects altogether or until the economy recovers. with businesses in the high-tech, software and educational
Silicon Valley office vacancy hit 19.1% in Q3 2009 industries.
compared to 13.6% a year ago, while availability was 14.2 In accordance with the slumping economy, Santa Cruz
million SF, compared to 9.8 million SF in 2008. Both are County office/R&D vacancy increased for eight consecutive
record high levels. The average asking rate slid $2.04 the quarters, rising from 9.8% in Q3 2007 to 12.9% in Q3
past year to $32.76/SF per year for full service properties. 2009. Meanwhile, the average asking rate fell by $1.20/SF
R&D vacancy also grew to 19.1% in Q3 2009, a hefty over the past year to $22.32/SF for full service properties.
increase of 5.7 million SF from 15.6% a year ago. The Total availability grew to 954,000 SF countywide in Q3
average asking rate was $12.96/SF NNN, down $2.52 2009. This market has not hit the 1 million SF mark since
Contact from Q3 2008. The velocity in these sectors softened and Contact 2004. Sublease space totaled 134,000 SF, or 14% of the
NAI Global decelerated as Q2 and Q3 consecutively fared much better NAI Global county’s total office availability, compared to 185,000 SF,
+1 609 945 4000 than the horrendous Q1 2009. +1 609 945 4000 or 23%, a year ago. Through the first three quarters of
Manufacturing vacancy was 8.35% with an average asking 2009, reported net absorption totaled a negative 153,200
rate of $8.16/SF NNN in the Q3 2009, while warehouse SF, more than the total negative net activity of 2008 and
vacancy was 8.85% with an average asking rate of $5.16/SF 2007 combined.
NNN. Both vacancies are up and both asking rates are down Manufacturing/warehouse vacancy grew to 5.1% in Q3
from a year ago. Notably, warehousing did note a reduction 2009, up from 3.9% a year ago. The industrial market had
in vacancy and positive net absorption in the Q3 2009. 560,000 SF available in Q3, with roughly 10% composed of
Silicon Valley sales activity has been very anemic, though it sublease space. Sublease space nearly tripled from 2008.
has accounted for a good portion of the total activity in the The average asking rate for industrial product was $8.88/SF
Metropolitan Area Metropolitan Area NNN in Q3 2009, a sharp decline of $1.56/SF from 2008.
Bay area and minor quarterly up-ticks have recently been
Economic Overview realized. Reports indicate Silicon Valley has the least amount Economic Overview Net absorption was negative 170,000 SF through the first
2009 of distressed real estate nationwide. 2009
three quarters of 2009, its most critical level since 2002.
We are still a few quarters from the market's bottom, but
Population 255,778 One positive trend for Santa Cruz County was the fall of
the Silicon Valley has several economic and employment unemployment rates in Q2 and Q3, after reaching a high of
Population 1,922,925 advantages compared to other areas in the country and Population 265,553
13.5% in Q1 2009. However, unemployment did still remain
should be positioned well ahead of the curve for commercial in the upper 10% range at the close of Q3 2009.
956,264
recovery once we experience sustainable economic recovery
Population Population 117,912
and job growth.
Household Household
Median Median

Median Age 37 Median Age 38
Santa Clara County At A Glance Santa Cruz County At A Glance

Class A (Prime) $ 18.00 $ 78.96 $ 35.60 23.9% Class A (Prime) $18.60 $ 28.20 $ 23.28 15.8%
Class B (Secondary) $ 15.48 $ 61.20 $ 26.88 13.7% Class B (Secondary) $12.00 $ 27.00 $ 21.84 10.5%
RETAIL RETAIL
Downtown $ 24.00 $ 72.00 $ 48.00 N/A Downtown $ 18.00 $ 42.00 N/A N/A
Neighborhood Service Centers $ 24.00 $ 48.00 $ 36.00 N/A Neighborhood Service Centers $ 12.00 $ 27.00 N/A N/A
Community Power Center $ 27.00 $ 60.00 $ 43.50 N/A Community Power Center N/A N/A N/A N/A
Regional Malls $ 45.00 $ 125.00 $ 85.00 N/A Regional Malls N/A N/A N/A N/A

Office in CBD $ 1,306,800.00 $ 3,310,560.00 Office in CBD $ 1,300,000.00 $ 3,200,000.00
Land in Office Parks $ 871,200.00 $ 2,178,000.00 Land in Office Parks N/A N/A
Land in Industrial Parks $ 653,400.00 $ 1,306,800.00 Land in Industrial Parks N/A N/A
Office/Industrial Land - Non-park $ 1,306,800.00 $ 1,742,400.00 Office/Industrial Land - Non-park $ 522,000.00 $ 1,500,000.00
Retail/Commercial Land $ 1,089,000.00 $ 1,742,400.00 Retail/Commercial Land N/A N/A
Residential $ 653,400.00 $ 1,960,200.00 Residential N/A N/A

Sonoma County, California Ventura County, California
Sonoma County, “the gateway to the wine country,” is Ventura County has certainly felt the impact of the recession
bordered on the south by Marin County, on the east by Napa with the demise of Countrywide, resulting in a negative
County, on the north by Mendocino County and on the west impact on the office market. Vacancy rates are approaching
by the Pacific Ocean. Sonoma is a highly regarded tourist 20% and net absorption was negative through 2009 Q3.
destination with nearly 7.5 million visitors in 2008. While this amounts to a substantial inventory, there is some
Sonoma office vacancy was at a high of 11.2% in 2004, good news. Very little space is expected to return to the
but has since climbed to 29.2% in Q3 2009. Vacancy market as it appears that Countrywide/Bank of America has
increased 300 basis points since Q3 2008. The average returned the majority of its unused space. This will help
asking rate decreased $1.32 in the past year to $20.80/SF reduce vacancy rates for Class A space, the preferred space
full service per year. Since 2004, nearly 4.8 million SF of of Countywide.
office space has been absorbed from the county’s available Demand for industrial space has slowed. A good deal of
marketplace. the decline is tied to the regional and national manufac-
The City of Santa Rosa remains relatively healthy with turing sector and the Port of Hueneme. The port imports
vacancy at 20.2% in Q3 2009, compared to 15.8% a year a significant number of the BMW automobiles that enter the
ago. Even with the vacancy spike, this submarket is still the West Coast for US distribution. As demand for cars dwindled,
lowest in Sonoma County. Petaluma’s vacancy remains so did the demand for industrial space related to warehousing
Contact Contact and transporting. As it appears that world trade has begun
among the highest in the county at 32.4%.
NAI Global NAI Capital (Ventura County) to increase, it is likely that demand for industrial space
+1 609 945 4000 Industrial vacancy remains on a healthy path, with Q3 2009 +1 805 278 1400 in Ventura County will also increase during the next 12
ending at 13.9%, up 270 basis points since Q3 2008. The NAI Capital (Westlake Village) months.
average asking rate closed Q3 2009 at $8.25/SF gross per +1 805 446 2400
year, down $0.24 SF from a year ago. Year-to-date 2009, NAI Capital (Simi Valley)
The retail market also experienced contraction during the
Sonoma County has recorded about 610,000 SF of leased +1 805 522 7132
recession but seems to be improving. Rents have leveled
space. The industrial market has seen a slowdown in its off and do not appear to be declining. In the Westlake
absorption, although the food industry is taking advantage Village/Thousand Oaks market, many centers have a
of this downturn by picking up large blocks of this space. vacancy factor of less than 4%. The number of delinquent
tenants has also dropped significantly and most retailers
Commercial sale activity has come to a stalemate during are reporting that sales activity is improving. One potential
Metropolitan Area 2009. Tenants and buyers are aggressively looking to take Metropolitan Area problem is a proposal by the City of Ventura to raise the
Economic Overview advantage of today’s soft market conditions, although at a Economic Overview sales taxes. If this ballot initiative passes, retail sales are
level that is sometimes more aggressive than landlords and likely to fall across the board. This could have a negative
2009 2009
sellers are able or willing to consider. impact on the demand for retail space.
We anticipate continued softening in values as capitalization Tight credit conditions, increasing commercial default rates,
2014 Estimated rates rise to accommodate perceived risk. Many are still 2014 Estimated ,787,305
and declining lease rates are negatively impacting the ability
waiting on the sidelines hesitant to commit due to current of buyers to secure financing. As a result, the number
Employment economic conditions. There remains a large gap in perceived Employment 371,999 and dollar value of sales transactions is down considerably.
Population 240,062 values between owners and tenants/buyers. Population However, low prices mean it is a good time to buy for those
Household Household
with adequate financing.
$90,424
Average Income $80,118 Average Income
Median Median $75,440

Household Income $67,472 Household Income
Total Population Total Population 36.1

Sonoma County At A Glance Ventura County 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
Class B (Secondary) N/A N/A N/A N/A Class B (Secondary) N/A N/A N/A N/A
RETAIL RETAIL
Regional Malls N/A $ 35.40 $ 21.83 14.4% Regional Malls $ 17.00 $ 48.00 $ 21.17 2.3%

Land in Office Parks $ 871,200.00 $ 1,306,800.00 Land in Office Parks $ 430,500.00 $ 1,300,000.00
Office/Industrial Land - Non-park $ 653,400.00 $ 1,089,000.00 Office/Industrial Land - Non-park N/A N/A
Retail/Commercial Land $ 871,200.00 $ 1,306,800.00 Retail/Commercial Land $ 525,000.00 $ 1,300,000.00
Residential $ 2,718,000.00 $ 2,613,600.00 Residential N/A N/A

Colorado Springs, Colorado Denver, Colorado
The economy for the Colorado Springs market has deterio- While Denver is healthier than most markets around the
rated somewhat since year-end 2008. Troop increases at United States, it continues to have its share of concerns.
Fort Carson, coupled with Department of Defense spending The good news is, Denver has been attracting companies
at five military installations, plus defense contractors, have from the renewable energy sector, including wind and solar,
been a significant stabilizing force on the economy and and there is hope that Denver will be viewed as a good place
prevented it from slipping further. The 12,000 troop increase to conduct “green” business.
at Fort Carson through 2011 will add 30,000 people to the Office vacancy rates have inched up over the last year with
Colorado Springs population. landlords being challenged by mounting tenant occupancy
Citywide, Class A office vacancies are 18.5%, up from costs. Operating expenses continue to increase as well,
2008's 13.1% and the vacancy rate in the CBD is 9.5%, up making it challenging for owners due to their lower net rents.
from 8.6%. Asking rates are down $0.18-$0.28/SF and the All agree that this should lead to pent-up demand that
strike rates on completed deals are well below asking rates. should see a spike in new leasing activity towards the middle
Year-to-date absorption citywide is 242,234 SF. Sales of 2010.
projected through 2009 are off 75% in sales price and 77% Historically, the industrial market has enjoyed a vacancy rate
in square footage. There were no significant office building between 6% and 7% and now it is nearing 10%. Industrial
starts in 2009. owners have resisted making tenant concessions, but as we
Contact Contact
The industrial vacancy rate is 11.6%, up from 9.3% at the closed out 2009 this began to change slightly. The good
NAI Highland NAI Fuller
end of 2008. Average asking rates are down $0.57/SF. news is there are several large (100,000 – 200,000 SF)
Commercial Group, LLC +1 303 292 3700
Sales projected to year end are off 67% on price and 63% transactions in the market, which should fill some voids that
+1 719 577 0044
on square footage. There were no significant industrial starts have been created due to the downturn in the economy.
in 2009. Denver’s retail sector suffered in 2009. Well located retail is
Retail vacancy is up 1.2% to 9.7%. Asking rates are up still holding its own, with outlying centers suffering the most.
$0.03/SF to $14.33/SF. Sales of retail properties are off The lack of consumer confidence has decreased retail sales
roughly 50% in both square footage and price. A new Costco making it difficult for some tenants to pay their relatively
opened in October 2009, with Lowe's and Kohl's close high rents. It could be several years before the retail market
behind in the University Village Shopping Center, which is stabilizes.
Metropolitan Area an urban renewal project with additional pads and shop Metropolitan Area The investment market in Denver is virtually non-existent.
space. The investment market has been very slow with both The lack of financing coupled with personal recourse and
institutional and 1031 buyers primarily on the sidelines and larger equity requirements by lenders have made investing
2009 the TICs trying to hold their assets. Sales have been primarily 2009
in commercial real estate challenging.
Population 632,079 owner-users utilizing SBA financing. Population 2,570,177
Job growth drives the commercial real estate market and
2014 Estimated The base economy is solid. However, without a significant 2014 Estimated until we see an increase in jobs and the stabilization
Population 688,728 increase in primary jobs, we are looking at a slow recovery Population 2,829,742
of unemployment, 2010 could be more of the same
that is subject to the vagaries of the national economy. for owners. The key will be to pay attention to costs, like
Population 298,947 Population 1,321,562 maintenance and tenant improvements, in order to minimize
risk to the owner.
Household Household
Median Median

35 37
Colorado Springs At A Glance Denver At A Glance

New Construction (AAA) N/A N/A N/A N/A Premium (AAA) $ 30.00 $ 35.00 $ 31.00 7.3%
RETAIL RETAIL

Office in CBD $ 871,200.00 $ 3,800,000.00 Office in CBD $ 20.00 $ 140.00
Residential $ 20,000.00 $ 50,000.00 Residential $ 30,000.00 $ 180,000.00

Delaware & Cecil County, Maryland Washington D.C.
Wilmington’s vacancy rate increased in 2009 while absorp- The Washington, DC, retail market experienced a decline
tion rates decreased. Local developers have acquired in market conditions over 2009. However, the stimulus
existing assets and have completed new construction, much package has had a positive impact on the overall real estate
of which has remained vacant. Suburban office vacancies market in Metropolitan Washington, DC, with several GSA
rose sharply in 2009 while suburban development will leases signed during the year. The Recovery Act group itself
continue with moderate pre-leasing activity. Industrial activity completed a lease for 12,000 SF at 1717 Pennsylvania
in New Castle County has been slow. Avenue and Troubled Asset Relief Program (TARP) signed
Bank of America continues to consolidate into Wilmington’s another lease for 70,000 SF at 1801 L Street.
CBD, bringing 500,000 SF of suburban office online. Class The amount of vacant office space in the Washington market
B is forecasted to lease quickly as it has shown moderate has trended up over the past four quarters. At the end of
activity and net absorption throughout 2009. Suburban 2008, there was 395,912 SF of vacant sublease space.
office availability remains below the national average and Currently, there is 447,301 SF vacant in the market. More
has stabilized for Class A and Class B properties. Class A of the same is expected for the balance of 2009 and
rates dropped while vacancy rose, with a reduction in Class the beginning of 2010, but things could change quickly if
B rates driven by increased sublease space. Development demand shows any signs of recovery. With over 2 million
sites in Middletown and Newark represent an additional SF still scheduled to deliver in 2009, and an additional
Contact 200,000 SF. Absorption and lease rates are expected to Contact 3.8 million scheduled for 2010, an easy prediction is an
NAI Emory Hill remain constant during early 2010. Medical office commands NAI KLNB, LLC increase in the vacancy rate through 2010. However,
+1 302 322 9500 the highest rental rates and land prices remain unchanged +1 202 375 7500 a potential tightening of supply may occur within the CBD
from 2007. during the first half of 2010. Less than 850,000 SF
Since 2002, nearly 2.5million SF of industrial had been expected to be delivered, is located inside the CBD and
absorbed by automakers. In 2008, both Chrysler’s Newark development in the retail sector is still doing well.
plant and Saturn’s New Castle plant closed. The University In the area locally referred to as NoMa (north of Massachu-
of Delaware purchased the Newark plant. Fisker Automotive setts Avenue), the multi-faceted Constitution Square, which
purchased the New Castle plant, where they will assemble consists of approximately 1.6 million SF of space, is under
a hybrid sedan. Industrial land absorption is expected to construction with the retail section anchored by a new urban
remain stagnant through 2010. Harris Teeter grocery store. The first delivery of space is
Metropolitan Area Metropolitan Area expected to occur at the end of 2010. In addition, Forest
Most of Delaware's new retail construction is mixed-use
Economic Overview Economic Overview City is building The Yards adjacent to Nationals Park. More
with some strip centers in Northern Delaware opting for
2009 additions and renovations. New construction is strongest 2009
than 400,000 SF of retail space and 2,800 residential units
Population 365,831 around the Christiana area. Southern Delaware continues Population 5,331,775 are planned.
to see growth. Future development around Route 273 and If employers slow the pace of job loss and the effects of the
Population 431,861 Christiana Mall will bring nearly 2 million SF online in the Population 5,398,312 stimulus package continue, the District could see several of
next few years. its submarkets begin to tighten in 2010.
Population 175,945 Cecil County, Maryland, has experienced increased industrial Population 2,934,389
activity due to aggressive county initiatives. Base Realignment
Household And Closure, which will transfer operations from Fort Household
Average Income $62,172 Monmouth to Aberdeen Proving Ground in 2011, is affecting Average Income $109,029
Cecil County as new residents are relocating to the area.
Median Median
Household Income $48,297 Accordingly, industrial interest remains strong throughout Household Income $81,001
the county.
39 37
Delaware & Cecil County, Maryland At A Glance Washington DC At A Glance

Manufacturing N/A N/A N/A N/A Manufacturing N/A N/A N/A N/A
RETAIL RETAIL
Community Power Center $ 19.50 $ 27.00 $ 21.00 10.0% Community Power Center $ 15.00 $ 40.00 $ 20.00 N/A
Regional Malls $ 55.00 $ 75.00 $ 60.00 5.0% Regional Malls $ 35.00 $ 90.00 $ 62.00 N/A

Office in CBD $ 40.00 $ 75.00 Office in CBD $ 2,600,000.00 $ 96,000,000.00
Land in Office Parks $ 300,000.00 $ 550,000.00 Land in Office Parks N/A N/A
Land in Industrial Parks $ 175,000.00 $ 220,000.00 Land in Industrial Parks N/A N/A
Office/Industrial Land - Non-park $ 150,000.00 $ 450,000.00 Office/Industrial Land - Non-park N/A N/A
Retail/Commercial Land $ 300,000.00 $ 550,000.00 Retail/Commercial Land $ 2,600,000.00 $ 96,000,000.00

Fort Lauderdale, Florida Ft. Myers/Naples/Port Charlotte/Bonita Springs, Florida
Fort Lauderdale is a service market for southeast Florida. Southwest Florida has many positive attributes with a
The major industries are tourism, finance and service related coastal location and excellent quality of life for its residents.
business with a strong segment of international trade. The region stretches from the 10,000 islands north to Port
The area is serviced by three seaports, Port of Miami, Port Charlotte, and from the Gulf of Mexico east to Lehigh Acres.
Everglades and the Port of Palm Beach as well as three The area has a significant amount of prominent, former and
international airports. Few sectors of the economy are current business executives and entrepreneurs who live in
growing. Most major industries are experiencing depressed Southwest Florida for a good part of the year. This wealth of
economic conditions. expertise and experience serve as valuable resources to the
The office market is experiencing declines in occupancy and business community.
rental rates and is expected to continue to weaken through The area is home to many institutions of higher learning;
2010. Values have dropped roughly 30% since 2007. There Edison State College, Hodges University, Ave Maria University
is no new construction in the market. and Florida Gulf Coast University, which is a member of
Industrial vacancies are in the 12% to 15% range. Rents the State University System of Florida. The number of well
are dropping, with many tenants asking for as much as 30% -educated students creates a valuable resource for local
in rent reductions from landlords and landlords are accom- companies to draw from. Southwest Florida continues to be
modating those requests in order to keep tenants in their home to a growing population of young professionals with
Contact Contact opportunities expanding to grow other industries, including
buildings. There is no new construction planned for 2010
NAI Rauch, Weaver, NAI Southwest biotechnology and healthcare.
except for build to suit space.
Norfleet, Kurtz & Co. Florida, INC
The retail market has experienced more vacancies each The John Madden Company is planning to break ground on
+1 954 771 4400 +1 239 437 3330
month. Rents are being reduced in order to keep tenants in the Research Loop at the Southwest Florida International
their space. Many major retailers have closed stores and Airport. This project will introduce new, high paying career
this trend is expected to continue through 2010. opportunities that will further propel the region, making it
more than a retirement destination.
New construction has become increasingly difficult. Investors
are holding off on major purchases unless they can buy at 2009 brought with it a continued increase in vacancy and
40% to 50% of previous values. Capitalization rates are up rental rates and an overall slowdown in development in all
to at least 8.5% to 9.5%. Financing requires 30% to 50% sectors of the marketplace. While many companies like
Metropolitan Area down and coverage ratios of 1.25% to 1.35%. Metropolitan Area McGarvey, JED of Southwest Florida and the East Group gear
up for “green” and sustainable responsible development, the
Economic Overview Multi family has some transactions but most sellers do not Economic Overview
economy dictates they proceed with caution while remaining
2009 want to discount prices. Sellers may not be able to sell their 2009 attentive to the needs and demands of the marketplace.
Population 5,305,182 properties without taking huge losses or getting banks to Population 1,094,938
write down loans. Land sales are all but non existent except Charlotte, Collier, Hendry and Lee counties reported an
2014 Estimated for small build to suit deals. The supply of land has been 2014 Estimated increase in unemployment in 2009. Lee County's unem-
increased due to the failure of so many car dealerships and Population 1,184,949 ployment rate rose to 13.9%, Collier County’s increased to
several proposed buildings. 13.1 % and Charlotte County’s figure grew to 12.7%. The
Population 2,792,167 Population 355,978
unemployment rate is not seasonally adjusted.
The policy of most landlords is to do anything to keep the
current tenants in place as new tenants are few and far The overall opinion is that 2010 will see a regional come-
Household Household
$71,345 between. Lenders are extending loans in a delay and pray $75,551
back as welcomed confidence returns to Southwest Florida.
Average Income Average Income
process. New construction is not on the horizon for 2010.
Median Median

44.2
Median Age 40 Median Age
Fort Lauderdale At A Glance Ft Myers/Naples/Port Charlotte/Bonita Springs, Florida At A Glance

RETAIL RETAIL

Office in CBD $ 500,000.00 $ 1,000,000.00 Office in CBD (per buildable acre) N/A N/A
Land in Office Parks $ 400,000.00 $ 650,000.00 Land in Office Parks (per acre) $ 217,800.00 $ 305,000.00
Land in Industrial Parks $ 250,000.00 $ 500,000.00 Land in Industrial Parks (per acre) $ 130,000.00 $ 215,000.00
Office/Industrial Land - Non-park $ 250,000.00 $ 500,000.00 Office/Industrial Land - Non-park (per acre) $ 90,000.00 $ 125,000.00
Retail/Commercial Land $ 650,000.00 $ 1,200,000.00 Retail/Commercial Land (per acre) $ 450,000.00 $ 1,000,000.00
Residential $ 200,000.00 $ 600,000.00 Residential (per acre) N/A N/A

Jacksonville, Florida Martin & St. Lucie Counties, Florida
Jacksonville's diverse economy makes it an ideal choice for The overall economy for Martin and St. Lucie counties has
relocating and expanding businesses and its healthcare continued to contract as unemployment has reached 11.2%
sector is emerging as a major medical player in the south- in Martin County and 14.7% in St. Lucie County. This has
east. However, in 2009 demand in all markets was, at best, had a negative impact on all sectors of commercial real
sluggish. Unemployment rates soared to 11.3% and estate. The area unemployment has also had a significant
consolidations in the financial services sector produced a impact on multi-family properties. The market for office
glut of sublease availabilities. With more than 40,000 people space remains slow as many companies with headquarters
employed in distribution/warehousing-related occupations, in larger metropolitan areas seek to close satellite offices in
even Jacksonville's robust logistics sector contracted slightly smaller markets.
in 2009. In the office market, the majority of leasing activity has been
Negative net absorption of 1,192,680 SF pushed in the form of tenants making a move from more expensive
Jacksonville's 2009 office vacancy rate to 15.8%. Average space to less expensive space. Rents are in the range of
rental rates declined from 2008 levels to $18.53/SF, but as $10/SF to $15/SF net for Class A and good Class B buildings
Jacksonville’s hospitals grow in national and regional and occupancy has dipped to approximately 85%.
stature, the need for additional medical office space should The industrial market has been the hardest hit. There remains
help reduce vacancies and spur an increase in rental rates approximately 750,000 SF of vacant flex space and rents
Contact in late 2010 and beyond. Contact
have been reduced to the range of $5-$7/SF gross from
NAI Commercial NAI South Coast
Over $14.8 million in federal stimulus funds is earmarked $10-$12/SF in the boom years. Vacancy in the industrial
Jacksonville. +1 772 286 6292
for infrastructure improvements at The Port of Jacksonville sector is at nearly 50% for all property types.
+1 904 358 2717
and additional funds are awaiting approval. Even so, product The retail market remains the most attractive. Small neigh-
delivered to the Port waned in 2009, as did distribution borhood tenant spaces range from $12/SF net to $18/SF
companies' expansion plans. As a result, industrial construc- net with the better positioned end caps and prime spaces
tion that commenced and completed in 2008 and 2009 experiencing a higher rate. Several big box facilities remain
was left temporarily vacant at a rate of 10.3%. vacant. Occupancy in the retail sector is approximately 85%.
Jacksonville's retail market behaved in accordance with The bid/ask in Martin and St. Lucie counties for investment
depressed national market standards in 2009. Eleven retail properties remains wide spread and financing investment
Metropolitan Area sales transactions with a total volume of $22.8 million Metropolitan Area properties remains a challenge.
and an average price of $78.17/SF closed in 2009. Land prices are at 20-50% of their value from the 2004-
In 2008, the market posted 15 transactions with a total 2006 period. Foreclosed, aggressively priced, bank-owned
2009 volume of $59.2 million and a price per SF averaging 2009
land is predominant in the market. In the multifamily market,
Population 1,344,504 $161.83. After 2008's record expansion of the multifamily Population 415,435
finished residential lots have shown stronger appeal in
market and the demise of the condominium conversion 2009. Several transactions have closed in the $25,000-
Population 1,454,531 market, demand for apartments plummeted in 2009. The Population 453,891 $50,000/lot range for lot packages ranging from 15-30 or
fallout from non-existent home sales and decline in Florida more lots.
Employment in-migration forced Jacksonville's 2009 apartment vacancy Employment
Population 663,969 rate to 13.7%, more than double 2008’s rate of 6.3%. Population 135,521 The overall outlook is better than at the beginning of 2009.
Most investors and businesses feel there is genuine oppor-
Household One of Jacksonville's largest 2009 office transactions was Household
tunity but remain cautious in their outlook. It is expected
Average Income $68,792 the lease of 43,008 SF for the new corporate headquarters Average Income $69,787
that in 2010 foreclosures will continue to spread into the
of Xorail, Inc. brokered by NAI Commercial Jacksonville. The commercial markets but there will be opportunities for those
Median Median
company also represented D&H Distributors in the lease of Household Income $49,891 in a position to take advantage of them.
79,652 SF of industrial space to Invacare Corporation.
38 Median Age 42.4
Median Age
Jacksonville At A Glance Martin & St. Lucie Counties At A Glance

Premium (AAA) $ 17.50 $ 19.72 $ 17.83 16.2% New Construction (AAA) $ 12.00 $ 20.00 $ 16.00 15.0%
High Tech/R&D $ 7.70 $ 14.91 $ 9.89 13.3% High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL

Office in CBD $ 250,000.00 $ 600,000.00 Office in CBD $ 450,000.00 $ 650,000.00
Retail/Commercial Land $ 125,000.00 $ 1,000,000.00 Retail/Commercial Land $ 500,000.00 $ 875,000.00

Miami, Florida Orlando, Florida
Experts in the market report that events leading into 2009 The overall Orlando office vacancy rate stands at 15.1%,
caused an unprecedented decline in all facets of commercial up from 12.3% one year ago. Average lease rates are down
and residential real estate. Activity quickly skidded to a halt by 3.3%. Net absorption has been negative in four of the
and stayed at a virtual standstill during the first half of 2009. last five quarters. Vacancies are highest in Class A properties
Foreclosures, short sales and loan restructurings were most where average rents have declined by 6% over the past year.
common. Predictions are that a bottom in the market was Vacant sublease space has increased in all submarkets.
reached and growth will resume in 2010, albeit at an Built-to-suit headquarters have dominated new office
anemic pace. It may be difficult to differentiate the growth construction.
from the stagnation. The overall Orlando industrial vacancy rate stands at 13.2%,
Investment activity is at a standstill due to a lack of financing, up from 8.3% one year ago. Average industrial lease rates
rising vacancy rates, lower rent rates and investors have dropped by more than 10.5% over the past year in
demanding increasing yields. Development activity is nonex- response to four consecutive quarters of negative absorption.
istent as declining rents combine with rising vacancy and Vacancy rates are highest for flex product at 17.6%. Tenants
capitalization rates to make development nonviable for up to in every industry that supports industrial real estate are
three years. Land prices are down by 50%. reluctant to commit to new leases and take advantage of
Office vacancy rates rose while rents dropped by more than aggressive concessions, resulting in stagnant deal volume.
Contact Contact Construction of new industrial space has halted throughout
10%. Certain submarkets, most notably the CBD & Brickell,
NAI Miami NAI Realvest the market.
are hardest hit as approximately 2 million SF are scheduled
+1 305 938 4000 +1 407 875 9989
to be delivered in 2010 and 2011. Increasing unemployment and a decline in tourism have
Miami’s industrial sector suffered from the recession as impacted the retail sector over the past year. Asking and
transshipping slowed and smaller tenants failed. Vacancies effective rents have dropped, while concessions increased
increased weekly. Bankruptcies in the automotive and to more than 10% of asking rents. The market-wide retail
construction industries intensified problems. Rents and vacancy rate is 8.3%, up from 5.7% one year ago. New
resale prices have dropped. Prospects for 2010 are grim as deliveries have been dominated by single-tenant super
stagnation does not foster tenant growth. centers. Investors are waiting on the sidelines for distressed
opportunities, though few have surfaced.
Retail demand has been hard hit. Consumer demand has
Metropolitan Area stopped, resetting to 2004 levels. Retailers are reevaluating Metropolitan Area Orlando is one of only two communities worldwide where a
store spacing and product offerings. Rents dropped and new medical city is being developed. The cluster of life sci-
Economic Overview Economic Overview ence companies emerging here include a new University of
vacancies increased. Exceptions are local, well-capitalized
2009
retailers. After waiting out the exuberance, they are selec- 2009 Central Florida College of Medicine, East Coast headquarters
tively expanding, negotiating favorable leases.
Population 2,124,270 of Burnham Institute for Medical Research, Nemours Chil-
dren’s Hospital, University of Florida Research Center, M.D.
2014 Estimated Residential prices dropped 20-50% because of a lack of 2014 Estimated
Population 5,051,513 Population 2,354,381 Anderson Cancer Research Institute, and Orlando VA Med-
end-user financing. Most multifamily projects are in a loan ical Center.
Employment restructuring, foreclosure, bankruptcy, short sale or some Employment
2,792,167 other workout. Some lenders sold their notes at a 50-80% 1,121,730
The $600 million VA facility, due to open in 2013, will be
discount. Others financed end-users, permitting lower the first VA hospital built in the United States since 1995.
Household prices. It appears the bottom was reached in 2008; stayed Household Within 10 years, the cluster is expected to create 30,000
Average Income $71,345 Average Income $68,690 jobs and generate $7.6 billion in economic impact.
flat in 2009 and will slowly increase in 2010.
Median 2010 will be a major transition year in most market Median
segments as the final problems will be addressed and the
Total Population markets stabilize. If population and job growth resume, the Total Population
40 Miami markets will accelerate at a pace faster than most 37
experts predict.
Miami At A Glance Orlando At A Glance

INDUSTRIAL INDUSTRIAL $ 3.95 $ 7.00 $ 5.65 12.3%
RETAIL RETAIL
Regional Malls $ 14.00 $ 53.72 $ 31.19 2.3% Regional Malls
DEVELOPMENT LAND Low/Acre High/Acre DEVELOPMENT LAND $

Low/Acre 45.00 $High/Acre 90.00
Office in CBD $ 3,250,000.00 $ 5,445,000.00 Office in CBD $ 218,000.00 $ 350,000.00
Land in Office Parks $ 653,400.00 $ 1,089,000.00 Land in Office Parks $ 130,000.00 $ 260,000.00
Office/Industrial Land - Non-park $ 435,600.00 $ 1,089,000.00 Office/Industrial Land - Non-park $ 218,000.00 $ 653,000.00
Residential $ 87,120.00 $ 5,445,000.00 Residential

Palm Beach County, Florida Tampa Bay, Florida
The local economy continues to be impacted by negative Service, retail finance, insurance and real estate are key
employment trends. The single-family residential market has drivers of the Tampa Bay economy. Bio-science and other high
bottomed while the condominium market has further to fall. tech industries are expanding, and the manufacturing base is
The investment sale market in 2009 has been non-existent growing as the regional economy continues to diversify.
and too few transactions have occurred to predict where Having hit bottom in late 2008, the entire Tampa Bay
prices will settle. A significant gap remains between bid and commercial real estate market is rebounding at an acceler-
ask as banks continue to be reluctant to foreclose on delin- ated pace. Transaction volume has resumed to a more
quent loans. normalized pace and activity levels increased during 2009.
The office market throughout the county is weak. Rental The Tampa Bay area investment apartment market
rates are 15-25% below peak rates, with free rent and other bottomed in Q1 2008, however the volume of transactions
concessions prevalent. The industrial vacancy rate for Palm is on the rise. REO bank foreclosures and troubled assets
Beach County has increased consistently from 8.9% in Q3 are dominating the multi-family market with nearly 80% of
2008 to 12.5% in Q3 2009. Year to date net absorption is the last 25 transactions closed having some sort of REO
a negative 1,843,615 SF. The overall average rental rate component.
decreased to $7.44/SF with flex rates at $8.91/SF and Vacancy levels in the office market increased to 15%
warehouse rates at $6.70/SF. regionally. Sublease space continues to shadow the market.
Contact Contact
Retail provides much of the same picture as the other Concessions persist as the standard course of business
NAI Merin Hunter NAI Tampa Bay
markets. Boca Raton and Delray Beach have weathered the and tenants are looking at every space in the market
Codman, Inc. +1 727 585 2070
storm best because of the density of population and strong before committing. The sublease market is estimated at a
+1 561 471 8000
demographics. Discount tenants of all types have benefited three-year supply with the greatest amount of sublease
from the decreased rental rates and increased vacancy and availability concentrated in the suburban markets.
have used that as an opportunity to expand. The county in The local industrial market suffers from an abundance of
general has seen retail rental rents retreat approximately functionally obsolescent product types with low ceilings and
20-30% from the 2006-2007 peak pricing. Along with fixed interior components. New flex space in the I-4 corridor
prices losing ground, vacancy has increased to over 10%. is the hot new market with several large facilities currently
New construction of speculative product in all property types under construction
Metropolitan Area is at a virtual standstill and will remain there for at least the Metropolitan Area The retail market continues to be a challenging environment
next 12-15 months. The Northern Palm Beach office market, based on current economic trends. The market conditions
Economic Overview consistently a strong performer, suffers from the downturn Economic Overview
have stalled several new developments slated for 2009
2009 in both residential real estate and financial services. The 2009
due to the credit crisis and lack of national retailer response.
Population 1,249,392 South County office market has an overall vacancy of Population 2,771,843
The new Cypress Creek Mall is currently slated for a 2011
26.2%. opening.
Population 1,208,909 The vacancy rates have been climbing steadily from 11.2% Population 2,895,484
The Tampa Bay investment market is a hotbed of opportunity
in Q4 2006. Overall absorption in South County, year to date, with values bottoming at nearly 50% of 2006 peak levels.
is negative 527,000 SF. West Palm Beach and its surrounding 1,277,414 Both institutional and local investor confidence and activity
markets, mirror what is happening in the rest of the county. have increased in 2009
Household Household
Median Median

43.2 41
Palm Beach County At A Glance Tampa Bay At A Glance

Premium (AAA) N/A N/A N/A N/A Premium (AAA) $ 25.00 $ 35.00 $ 30.00 30.0%
Class A (Prime) $ 19.00 $37.50 $ 30.00 22.7% Class A (Prime) $ 21.00 $ 32.00 $ 28.00 15.0%
RETAIL RETAIL

Land in Office Parks N/A N/A Land in Office Parks $ 50,000.00 $ 150,000.00

Atlanta, Georgia Honolulu, Hawaii
Metropolitan Atlanta is home to over 5 million residents and Honolulu is the 51st largest economy in the United States
137,000 businesses. Atlanta’s diverse population, deep talent and is a vibrant and resilient metropolitan city. The commer-
pool, strong local communities, global transportation cial real estate market is expected to maintain limited growth
and quality of life contribute to its economic strength and throughout 2010. The dire projections for 2009 were less
ongoing growth. Atlanta ranks fifth in the United States for than expected and visitor arrivals, a major economic
the number of Fortune 500 headquarters. The Atlanta area indicator for Hawaii, were greater than projected for 2009.
remains a haven for both national/international relocations The Honolulu market will benefit from the increase in the
and expansions and is ranked second-least-expensive city in Yen value as Japanese investors seek more value for their
the country in which to operate a corporate headquarters. investments.
Atlanta is also home to the world’s busiest airport with 30 The Honolulu CBD saw 2009 end with vacancy rates above
airlines and an average of 1,500 daily flights to over 250 10.73% and negative absorption. Average asking rents are
worldwide destinations. Additionally, Atlanta is the rail center $2.91/SF gross per month. Landlords are very focused on
of the South and one of the five most important distribution retention and we are seeing a softening in asking rates and
centers in the US, with two major rail carriers each operating more concessions such as free rent and liberal TI
over 100 freight trains daily to and from Atlanta. allowances. Market rates on average are 11% below the
The Atlanta Office market supply has outweighed the de- asking rates at year-end 2008.
Contact Contact
mand, pushing the vacancy rate up in the 19-22% range, Oahu’s industrial market continues to outperform its mainland
NAI Brannen Goddard NAI ChaneyBrooks
creating negative net absorption and declining rental rates. counterparts. The demand for bulk warehouse space has
+1 404 812 4000 +1 808 544 1600
With over 196 million SF of inventory, it is anticipated that the softened with the weakening of tourist arrivals, resulting in
Office market will experience more negative net absorption an island-wide vacancy rate of 5.22%. Average asking rental
and remain flat for 2010. rates for bulk warehouse space ranges from $0.95/SF
At the close of the third quarter, the Industrial market, with to $1.20/SF net for the most desirable locations. Going
over 560 million SF of inventory, reported a slowdown in forward, we expect to see a leveling off in Oahu’s industrial
absorption. The amount of new construction has dropped market due primarily to a softening housing market and
considerably and although vacancy rates have climbed over tourist arrivals; however, we anticipate renewed sales activity
the past several quarters and rental rates decreased slightly, as opportunistic investors acquire available industrial
leasing activity remains active. parcels.
Atlanta’s Retail market, with over 298 million SF of inventory, Honolulu’s retail sector, which benefited from tremendous
Economic Overview Economic Overview growth and an influx of capital for redevelopment projects
is reporting a slight decline in market conditions. Vacancy
2009
rates are hovering in the 10-14% range, negative net absorp- 2009 from 2006 through mid-2008, has changed considerably.
tion is reported and rental rates are down from the last several
Population 895,361 Many retailers who are locked into long term leases at
quarters. previously negotiated rental rates are finding the economic
Population 6,190,636 Population 870,854 challenges too difficult to navigate. Major shifts are projected
One of the larger office projects under construction at the in hotel and resort property ownership as opportunities to
Employment end of Q3 is Phipps Tower, a 486,000 SF building to be Employment buy distressed assets that are irreplaceable become more
Population 2,591,351 completed in Q1 2010. The largest industrial lease-signing Population 431,431 prevalent.
year to date is the 556,800 SF lease signed by Smuckers
Household in South Atlanta. Household Hawaii’s real estate market is firmly in a period of adjustment.
Average Income $76,542 Average Income $80,939 This type of market always creates opportunity for the
entrepreneurial investor and user. We are seeing an
Median Median
onslaught of extend and blend as well as lease assignments.
We anticipate a stabilization of the market in the second half
Total Population Total Population of 2010.
35 38
Atlanta At A Glance Honolulu At A Glance

New Construction (AAA) $ 23.00 $ 32.62 N/A 92.0% New Construction (AAA) $ 33.00 $ 48.24 $ 43.92 6.6%
Class A (Prime) $ 22.91 $ 26.25 N/A 22.1% Class A (Prime) $ 27.00 $ 39.00 $ 34.68 10.3%
Class B (Secondary) $ 16.23 $ 19.83 N/A 19.9% Class B (Secondary) $ 23.40 $ 33.00 $ 26.76 13.9%
New Construction (AAA) $ 20.00 $ 25.88 N/A 75.0% New Construction (AAA) $ 28.20 $ 45.00 $ 46.98 N/A
Class A (Prime) $ 19.79 $ 25.34 N/A 12.2% Class A (Prime) $ 25.20 $ 43.20 $ 31.80 N/A
Class B (Secondary) $ 15.82 $ 19.40 N/A 17.8% Class B (Secondary) $ 15.00 $ 27.00 $ 22.20 N/A
Bulk Warehouse $ 2.40 $ 3.25 N/A 12.1% Bulk Warehouse $ 14.28 $ 20.28 $ 17.28 7.3%
Manufacturing $ 2.50 $ 3.50 N/A 13.1% Manufacturing $ 11.40 $ 19.56 $ 15.48 5.0%
High Tech/R&D $ 3.75 $ 7.00 N/A 15.6% High Tech/R&D $ 19.56 $ 40.20 $ 29.88 3.2%
RETAIL RETAIL
Downtown $ 10.00 $40.00 N/A 8.0% Downtown $ 28.40 $ 210.00 $ 124.20 2.6%
Neighborhood Service Centers $ 11.00 $23.00 N/A 14.5% Neighborhood Service Centers $ 32.76 $ 64.92 $ 48.84 2.5%
Community Power Center $ 10.00 $22.00 N/A 9.5% Community Power Center $ 20.04 $ 42.36 $ 31.20 7.1%
Regional Malls $ 13.64 $50.00 N/A 4.1% Regional Malls $ 48.96 $ 79.80 $ 64.32 2.6%

Office in CBD $ 10.00 $ 25.00 Office in CBD $ 950,000.00 $ 6,700,000.00
Land in Office Parks $ 75,000.00 $ 200,000.00 Land in Office Parks $ 655,000.00 $ 3,700,000.00
Land in Industrial Parks $ 25,000.00 $ 75,000.00 Land in Industrial Parks $ 420,000.00 $ 2,700,000.00
Urban Retail/Commercial Land $ 1,200,000.00 $ 4,000,000.00 Retail/Commercial Land $ 1,420,000.00 $ 12,000,000.00
Retail/Commercial Land $ 150,000.00 $ 400,000.00 Residential N/A N/A
Residential $ 20,000.00 $ 150,000.00

Boise, Idaho Southeast (Idaho Falls/Pocatello), Idaho
Commercial Real Estate in the Boise Metropolitan area Eastern Idaho is uniquely positioned to continue its steady
experienced high vacancy rates and decreasing lease rates. growth and weather the economic storms facing the nation,
Unemployment has risen but is still below the national with an economy fueled by a well-educated workforce,
average. The high-tech sector has stabilized and may energy, medical technologies, agribusiness and tourism. In
increase in 2010. Boise’s health care sector is growing Idaho Falls, the strategically located 400-acre Snake River
along with alternative energy. Retail, office and industrial are Landing development opened its Central Valley, an integral
down. Residential development has stopped. Much needed part of the master-planned community that includes over 30
highway work is providing economic stimulus to the area. acres of green space, walking paths, cascading waterfalls
Boise is still rated one of the best areas in the country to and a 3.65-acre lake.
live, work and start a business (Forbes), as reflected by the Plentiful recreation opportunities abound in the area, along
dramatic increase of company inquiries. With an educated, with easy access to world famous destinations like Jackson
employable workforce, Boise State University and a great Hole, Grand Targhee and Yellowstone. Pocatello is a strate-
quality of life, we see an upswing occurring in all markets in gically located logistics hub that is also home to the state's
2010 except residential development. The industrial sector premier health research university and a variety of new retail
has been hit hard and vacancy rates have reached 11%. developments, including Costco. Rexburg has benefited from
Lease rates are similar to the mid 1990s at around $0.32 the continued expansion of BYU-Idaho, led by the former
Contact to $0.48/SF. Contact Dean of the Harvard Business School.
NAI Pinnacle NAI Commerce One Real
Vacancy in the office sector is continuing to rise with an Eastern Idaho provides an abundance of opportunities for
+1 208 947 0019 Estate, LLC
overall 19.5% vacancy rate. Vacancy rates throughout the energy related companies, including commercialization pro-
+1 208 525 8088
submarkets are ranging from 7.5% vacancy Downtown to grams between the Idaho National Lab and private industry,
over 25% in the Southwest Boise market. New construction and an increasing number of research parks and incubators.
and owner occupied sales are down more than 50% from The INL employs over 7,500 scientists, researchers and
last year. Multifamily vacancies are under 8%, reflecting an support staff, providing economic stability in the region.
increasing market sector. Fully leased investment properties Idaho is one of the top four states in the nation in green job
are still hard to find and when found carry capitalization growth, with eastern Idaho being very attractive due to its
rates equivalent to national norms of mid 7% to high 8%. vibrant business environment, low cost of living, industrious
Metropolitan Area Retail is still location specific. An overall vacancy rate of 14% Metropolitan Area
workforce and favorable local government support. Pocatello
represents an increase over 2008. The big box retailers that was selected as the location for Nordic Windpower’s
Economic Overview closed are replaced by retailers new to the area, which Economic Overview North American manufacturing facility because of its advan-
2009 speaks well for the vibrancy of the Boise Metropolitan Area. 2008 tageous cost of operations, excellent workforce and
Population 631,645 Owners in all sectors will continue to offer aggressive Population 122,265 central location to potential customers and transportation.
concessions such as free rent, lower rates, and increased Also in Pocatello, the Hawaiian company Hoku Scientific, is
Population 740,193 TI allowances. continuing work on its $390 million polysilicon plant
Population 134,838
The Boise Metropolitan Area is once again poised to grow in scheduled to be finished in 2010.
306,935
2010 driven by new jobs from relocated companies. Retail Areva’s $2 billion Eagle Rock uranium enrichment facility,
and industrial sectors will increase first, followed by office located west of Idaho Falls, is slated for completion in 2014.
Household and residential. Quality of life will still be our driving force Household According to a study by the Regional Development Alliance,
Average Income $66,650 for 2010. Average Income $56,740 the project could bring up to $5 billion in economic activity
and create 5,000 direct and indirect jobs during construction.
Median Median

34
Median Age Median Age 32
Boise At A Glance Idaho Falls/Pocatello At A Glance

RETAIL RETAIL

Office in CBD $ 1,004,400.00 $ 1,306,578.00 Office in CBD $ 217,000.00 $ 435,000.00

Chicago, Illinois Springfield, Illinois
Chicago, the third largest metropolitan area in the US Springfield, the capital of Illinois, accounts for approximately
after New York and Los Angeles, 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
Situated at the geographical heart of the nation, Chicago’s sectors are government, medical, public service and small
location advantages have fostered its development into an business. Money for commercial real estate loans is readily
international center for banking, securities, high technology, available. Springfield's current economy has been impacted
air transportation, business services, manufacturing, to a lesser extent than that of the national economy.
wholesale and retail trade. Government is the largest employer in the Springfield area.
The downtown office market experienced four consecutive The two largest private employers in the region are St. Johns
quarters of negative net absorption and rising vacancies Hospital and Memorial Hospital, including the SIU School of
during 2009. Throughout the market, Class A and Class B Medicine. Over the last year, there have been some major
buildings are suffering from the highest vacancies, medical developments including a cancer research center,
each above 16%. While three projects representing over a new hospital and a $40 million expansion of the Spring-
3.6 million SF were delivered during 2009, there is no field Clinic. Current medical developments include another
ongoing construction, as any proposed projects have been 50-bed acute care hospital and an orthopedic medical
put on hold until the financial markets and the economy facility with rehabilitation services. Higher education
Contact begin to recover. Vacancy should level off in 2010 as Contact opportunities include the University of Illinois at Springfield,
NAI Hiffman transaction velocity continues to accelerate. NAI True Southern Illinois University School of Medicine and Lincoln
+630 932 1234 +1 217 787 2800 Land Community College. Robert Morris University and
Chicago’s suburban office market is composed of several
scattered pockets of corporate parks and high-rise office Benedictine University at Springfield make up the private
towers and experiences historically higher vacancy rates, colleges in the area.
larger swings in net absorption, and lower asking rents than Retail growth in Springfield is recovering with the opening of
downtown. Suburban vacancy rates have been rising national chain stores and big-box users like Super Wal-Mart,
steadily since 2008, eclipsing 22% in 2009. Leasing activity Menards and Gander Mountain over the past 18 months.
is expected to pick up during 2010 as asking rents continue Scheels is planned to open soon in the area with a belief
to slide and landlords offer aggressive concession that other national chain stores will continue to locate in
packages. This should result in stabilizing vacancy rates for Springfield. The Abraham Lincoln Museum and Library are
Metropolitan Area the suburban office market. Metropolitan Area two prestigious visitor/tourist attractions in Springfield.
Economic Overview The second largest industrial market and the most important Economic Overview Recreation opportunities in Springfield are plentiful with
2009 transportation hub in the country, Chicago’s industrial over 30 public parks offering tennis courts, ice rinks and
2009
Population 9,540,736 market was challenged during 2009 due to lack of Population 207,549 swimming pools. There are nine public golf courses, two
consumer spending, difficulty obtaining credit and economic country club golf courses, indoor/outdoor theatre venues
2014 Estimated
uncertainty. New construction projects are few as developers 2014 Estimated and a 4,235-acre lake.
have responded to market conditions. Lack of new deliveries, Despite the breadth of history, culture and recreational
Employment combined with an increase in transactional activity, will help Employment opportunities found in Springfield, the cost of living remains
Population 4,981,030 the market eventually rebound. Population 150,563 low. Springfield has consistently been one of the most
Household Chicago’s expansive intermodal developments show affordable communities in Illinois with robust residential
Household
Average Income $79,857 continued success due to their ability to offer tremendous Average Income $60,441 sales in 2009.
transportation savings to importing operations. The nation’s
Median Median
largest inland port, the CenterPoint Intermodal Center, Household Income $55,950
has fueled the regions growth, securing its importance both
Total Population nationally and internationally. Total Population
Median Age 36 39
Median Age
Chicago At A Glance Springfield At A Glance

Manufacturing $ 3.00 $ 6.25 $ 4.40 11.7% Manufacturing N/A N/A N/A N/A
RETAIL RETAIL
Downtown $ 22.00 $ 220.00 N/A 8.2% Downtown $ 8.00 $ 15.00 $ 11.00 12.0%
Neighborhood Service Centers $ 12.00 $ 26.00 N/A 9.6% Neighborhood Service Centers $ 10.00 $ 23.00 $ 17.00 12.0%
Sub Regional Centers $ 10.00 $ 14.00 N/A 9.8% Community Power Center N/A N/A N/A N/A
Regional Malls $ 20.00 $ 80.00 N/A 7.8% Regional Malls N/A N/A N/A N/A

Office in CBD $ 80.00 $ 500.00 Office in CBD $ 450,000.00 $ 945,000.00
Land in Industrial Parks) $ 120,000.00 $ 435,000.00 Land in Industrial Parks $ 35,000.00 $ 100,000.00
Retail/Commercial Land ) $ 700,000.00 $ 1,300,000.00 Retail/Commercial Land $ 130,000.00 $ 480,000.00
Residential $ 50,000.00 $ 1,000,000.00 Residential $ 5,000.00 $ 25,000.00

Fort Wayne, Indiana Indianapolis, Indiana
The economic climate in the greater Fort Wayne market The Indianapolis metropolitan area achieved high positive
declined slightly through 2009 with an unemployment rate net absorption in the office and industrial markets in 2009.
in the six-county SMSA rising to 9.5%. Fort Wayne continues Investment, retail and land sales continued despite a
to revitalize its downtown. A $30 million baseball stadium decrease in overall purchases. The Indianapolis population
and a 900-space parking garage have been completed, a is growing and employment levels in the area fared better
$35 million Courtyard by Marriott Hotel is currently under than the rest of the state and other metropolitan areas.
construction and the $14.5 million residential condo- The industrial market had more medium distribution product
minium/retail complex is expected to break ground in the constructed than any other product type. In the past, con-
near future. struction of modern bulk buildings added the most to overall
The retail market slowed again in 2009. The strongest major inventory. This shift to smaller construction is expected to
retail submarkets are on the Dupont and Lima Road continue into 2010. A total of five buildings totaling 828,000
corridors in the Northern section of the city and along Illinois SF were delivered to the market in Q3, with 420,000 SF still
Road in the Southwest section. Orchard Crossing, which under construction at the end of the quarter. Speculative
opened in 2008, continues to be a draw, with Target and construction will continue, albeit at a slower rate than in
Goodman’s as anchor tenants along with 26 other possible 2007 and 2008. Rental rates ended Q3 at $4.46/SF, a
occupants. The Maplecrest Road extension, connecting the decrease over Q2.
Contact Northeast residential markets with New Haven, will be com- Contact
The office market ended Q3 2009 with a vacancy rate of
NAI Harding Dahm pleted by 2012 and should lead to future retail development. NAI Olympia Partners
11.1%. The vacancy rate was unchanged over the previous
+1 260 423 4311 +1 317 264 9400
The industrial market has seen an abundance of larger quarter, with net absorption totaling positive 50,797 SF in
facilities become vacant while the demand for smaller Q3. Rental rates ended Q3 at $17.32/SF, an increase over
industrial buildings continues to remain stable. The office the previous quarter. Only one building totaling 109,219 SF
warehouse market continued to be soft throughout 2009. delivered to the market in Q3 with 709,591 SF is still under
Vacancy rates in this sector are at 15%. There has been construction.
very little construction in this sector over the past year and The retail sector welcomed new vendors to the market,
very little is planned for 2010. This will remain the case until newly constructed strip centers and shopping centers and
there are improvements in economic conditions and the a variety of specialty restaurants. Several retailers entered
financial markets. the new midfield terminal at the Indianapolis International
The office market is stable; however, vacancy rates are still Airport in Q4. The retail market experienced an increase in
Economic Overview high. There is very little construction in the office industry, Economic Overview activity by discount retailers in 2008.
2000 but the market is experiencing strong growth in medical 92008
The economy continues to improve as the employment and
Population 412,468 office space as Parkview Hospital constructs a new regional Population 1,746,373
population levels both increase. The multi-tenant office
medical center in the I-69/Dupont interchange. Both market continues to expand as inventory grows and the total
Population 418,327 Parkview and Lutheran continue to expand with new medical Population 1,870,651 net absorption of space is positive. Investors remain
office buildings on their respective campuses. interested in the industrial market as modern bulk facilities
246,965
We project this market will continue to remain status quo 1,039,590
are still being delivered throughout the market.
over the next few years with unemployment remaining at
Household current levels within the six-county SMSA. Household
Median Median

37 36
Fort Wayne At A Glance Indianapolis At A Glance

RETAIL RETAIL


Cedar Rapids, Iowa City, Iowa Davenport, Bettendorf, Iowa and Rock Island, Moline, Illinois
Cedar Rapids, Iowa City and Waterloo, the Eastern Iowa The Quad Cities (Davenport and Bettendorf, Iowa, and Rock
Corridor, are still recovering and rebuilding from the historic Island and Moline, Illinois), the four cities bordering the
floods of 2008. With a loss in excess of $6 billion, the Cor- Mississippi River, continue to be a vibrant community in
ridor’s major new industry is recovery and reconstruction. which to do business. The area’s largest employer, the Rock
The floods and recovery will be the major area of economic Island Arsenal, continues to add jobs while other larger
activity for years to come. employers are reducing their labor force by modest amounts.
Post flood, demand for Class A and B suburban office space While there is a slight oversupply of office space, landlords
reached unprecedented highs with 94% occupancy and are holding steady in their asking rates. This has caused
rates on a NNN basis from $13 to $16 for Class A space and landlords and tenants to become savvier in lease negotia-
$10 to $12 for Class B space. Class C space remained tions, resulting in leases that include rent abatement, rental
soft with rates from $6.50 to $9 and an 82% occupancy rates to be stair-stepped over the term of the lease, more
rate. Cedar Rapids CBD space was 100% lost on the first tenant improvements being paid for by property owners and
floors and slowly recovering at this writing with rents below shorter lease terms.
$10. Warehouse and industrial space is tight with an over- Whereas retail has been challenged nationally in 2008-
all vacancy of 7.8% and average rents of about $5.50/SF. 2009, the Quad Cities has not seen the large run of closings
Because of strategic location midway between Chicago that other areas have experienced, mostly because the
Contact and Omaha and St. Louis and St. Paul, warehousing Contact
troubled companies nationally either do not have stores in
NAI Iowa Realty remains quite active and any large vacancies are typically NAI Ruhl & Ruhl
this market or the stores in the market have maintained
Commercial backfilled readily. Commercial Company
sales sufficient to escape closure. The Quad City area, with
+1 319 363 2337 +1 563 355 4000
As elsewhere, retail has been slow with little movement and 375,000 people in the MSA and over 900,000 people in a
prices are steady in the $10 NNN range for second and third 60-mile radius, remains attractive to retailers.
generation space. The major centers have been able to Industrial real estate activity began slowing down in the
maintain high (88%+) occupancy with little rent erosion. Our second half of 2008. The slowdown continued into Q1 2009
major retail center, 2,300,000 SF in Coralville, maintains a as local area manufacturers began laying off employees and
near 100% occupancy. Rebuilding is expected to return over putting expansion plans on hold in response to the nation’s
100,000 SF of Class A and B office/service/retail space to Metropolitan Area
Economic Overview recession. There was brisk activity through 2008 and into
the CBD of Cedar Rapids in the next few years. In addition, 2009 from wind power manufacturers and logistics
Metropolitan Area new City, County and Federal Government buildings are 2009 providers who were focusing on Iowa locations. Numerous
Economic Overview planned in the CBD to replace those destroyed. Population 373,332 prospects from many countries visited the Quad Cities area
2009 A recent sale of a neighborhood mall at $9.5 million and a 2014 Estimated
to view existing manufacturing facilities, greenfield sites for
Population 257,417 mobile home park at $12 million show that players are still Population 366,440 new factories and storage sites.
interested in the Corridor area. As money loosens, there are The Quad Cities has had slower but steady growth over the
2014 Estimated Employment
Population 268,328 a number of investment properties that are and will be years. Employment, housing and commercial development
Population 221,583
coming available. is not as oversupplied as many of the markets that
Employment
172,433
Household experienced more growth before the recession. This has
Population Average Income $58,670
been a very positive influence to the area’s more stable
Household Median
housing and commercial real estate values.
Median
Total Population
Household Income $57,180 38
Median Age
Total Population
38
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
Class A (Prime) $ 10.00 $ 13.00 $ 11.50 N/A Class A (Prime) $ 13.00 $ 18.00 $ 15.25 15.0%
Class B (Secondary) $ 7.00 $ 10.00 $ 8.00 N/A Class B (Secondary) $ 7.00 $ 11.00 $ 9.50 20.0%
High Tech/R&D $ 7.00 $ 15.00 $ 9.00 N/A High Tech/R&D $ 6.50 $ 8.50 $ 7.50 10.0%
RETAIL RETAIL

Office in CBD N/A N/A Office in CBD $ 6.00 $ 8.00
Land in Office Parks $ 160,000.00 $ 280,000.00 Land in Office Parks $ 217,800 $ 392,040
Land in Industrial Parks $ 40,000.00 $ 130,000.00 Land in Industrial Parks $ 43,560 $ 108,900
Office/Industrial Land - Non-park $ 40,000.00 $ 160,000.00 Office/Industrial Land - Non-park $ 43,560 $ 108,900
Retail/Commercial Land $ 165,000.00 $ 522,000.00 Retail/Commercial Land $ 348,480 $ 609,840
Residential $ 16,000.00 $ 45,000.00 Residential $ 43,560 $ 87,120

Des Moines, Iowa Sioux City, Iowa
The Des Moines Metro’s position as the financial and insurance The metropolitan area includes Sioux City, Iowa, South Sioux
hub of the Midwest and the subsequent weakness within that City, Nebraska, and North Sioux City, South Dakota. Site
industry has led to the instability of the market. Downsizing Selection magazine ranked the Sioux City area number one
and widespread layoffs have created an inability to backfill nationally in economic activity among metros under 200,000
space that has been created due to the building of owner people in 2007 and again in 2008. Strong development
occupied facilities. activity in the agricultural business and food processing
Allied/Nationwide Insurance recently completed the third sectors were responsible for the ranking.
phase of their downtown office development for a total of over The industrial market has a total of 15,250,000 SF, with a
1,000,000 SF. Aviva Insurance is currently constructing the favorable 7.5% vacancy rate and steady new construction.
first building of a suburban campus for mid 2010 occupancy Work is under way on a $400 million expansion by Beef
totaling 360,000 SF. Wellmark Blue Cross Blue Shield is Products, Inc. in South Sioux City, which is the largest single
also in the midst of building a 550,000 SF CBD facility investment ever made in Nebraska. The most significant
that is being assisted by Des Moines’ commitment to new industrial news is a $10 billion, 400,000 barrel oil refinery
development surrounding a large redevelopment area planned by Hyperion Resources of Dallas that would be the
known as Gateway West. Although this contributes to an second largest construction project in the history of the
amount of new construction that many larger markets would United States. The company has obtained options on over
Contact envy, the vacancy that is being created when these companies Contact 10,000 acres and a countywide referendum approved a
NAI Ruhl & Ruhl move out of competitive space is currently placing downward NAI LeGrand & Company rezoning petition for the project. Construction is likely to
Commercial Company pressure on lease rates as owners compete to fill properties +1 712 277 1070 begin in 2011.
+1 515 309 4002 that have historically enjoyed very low vacancy rates. Sioux City is the dominant retail center in the region with
The West Suburban Market continues to see the bulk of new 6,098,000 SF of space. Retail sales have steadily increased
development activity in the metro area. Over 400,000 SF of due to a large amount of new space coming on line, but
new, high cube warehouse was brought online in the past it was only a matter of time until overbuilding outpaced
12 months along the Interstate 80/35 corridor. Developers demand. Many properties are experiencing rising vacancy
have been able to lease much of this space prior to the rates and falling rental rates, creating a favorable market
completion of the buildings. In addition, several technology for tenants.
companies, such as Microsoft, have selected the market for The office market consists of 5,572,000 SF, and has main-
Metropolitan Area high tech server farm facilities, which represent a substantial Metropolitan Area
tained a split personality. The professional sector remains
Economic Overview investment in the area. Although these projects have been Economic Overview weak due to the lack of white collar job growth, while the
2009
placed on hold temporarily, sites have been acquired and medical market is robust. Medical space has accounted for
2009
Population 564,915 site plans approved. Population 141,240 nearly half of all office construction since 2000. The Dakota
A new Super Wal-Mart recently broke ground in the Dunes submarket thrives with just a 2.8% vacancy rate, the
Population 608,748 northwest suburb of Grimes and is scheduled to open in the 137,187
highest average rents in the region, and more space under
Population
summer of 2010. This appears to be kicking off the creation construction.
Employment of a new retail node and is attracting interest from retailers Employment The Sioux City area will experience an unprecedented
Population 366,008 that have declared themselves in a slow growth mode. Population 80,169
economic boom if the proposed Hyperion Energy Center
Household Household goes forward. A research study estimates the project would
Average Income $70,130 Average Income $59,654 result in 14,000 new jobs and add $14 billion in annual
economic activity to the market.
Median Median

36 37
Des Moines At A Glance Sioux City At A Glance

Premium (AAA) $ 23.00 $ 26.00 N/A 24.0% New Construction (AAA) N/A N/A N/A N/A
New Construction (AAA) $ 14.00 $ 25.25 N/A N/A New Construction (AAA) $ 16.25 $ 20.88 $ 18.00 N/A
Class B (Secondary) $ 12.25 $ 15.50 N/A 7.5% Class B (Secondary) 7.50 $ 12.00 $ 11.00 13.0%
High Tech/R&D $ 2.20 $ 5.75 N/A 7.8% High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Community Power Center $ 9.00 $ 20.00 N/A 5.7% Community Power Center $ 11.00 $ 24.00 $ 16.00 11.0%
Regional Malls $ 6.50 $ 28.50 N/A 17.7% Regional Malls $ 30.00 $ 45.00 $ 35.00 7.5%

Office in CBD $ 348,480.00 $ 450,000.00 Office in CBD N/A N/A

Wichita, Kansas Lexington, Kentucky
As the Wichita Metro area entered the economic downturn, Lexington’s commercial real estate market continues to
all its major sectors--aircraft manufacturing, energy, experience reduced activity. There has been an increase in
agricultural and healthcare--were in excellent health. The vacancy in all segments of the market. Since Lexington is
local unemployment rate at the beginning of 2009 was not overbuilt, occupancy is expected to rebound in 2010.
6.0%. As the local economy softened, the unemployment 2010 should also yield opportunistic property purchases as
rate rose to 8.9%, largely due to layoffs in the aerospace a vast amount of equity anticipates asset re-pricing and REO
manufacturing industry. sales.
The commercial real estate rental rates and market values The office market has experienced a decline in occupancy
have not decreased appreciably from last year; however, in the suburban market and the CBD. Office construction
the transaction volume as a whole is down approximately has slowed significantly, which will assist the market in
30-40%. Vacancy rates in the industrial sector have recovery and increase occupancy as the economy improves.
increased approximately 3%, while the office and retail rates Rental rates have declined but should stabilize in 2010.
have only increased approximately 1%. Sales of commercial Retail remains slow with little growth planned for 2010.
property due to bank foreclosures are not yet significant. Value-oriented retailers continue to expand on a selected
This is largely due to long term stability in lease rates and basis while rates remain stagnant.
property values. However, sales of development land for new Property owners have been more flexible to lease vacancies.
Contact projects are down significantly. Contact
Recent activity has occurred in small office/warehouses and
NAI John T. Arnold NAI Isaac
Local and national restaurant chains are opening new stores some adaptive reuse of older bulk warehousing. Industrial
Associates, Inc. +1 859 224 2000
in the Wichita market. The Burger King franchise will be will remain stable for 2010 with gradual absorption of
+1 316 263 7242
opening four new stores in 2010, and Spangles, a local vacancy and limited new construction.
chain, will be adding a new location as well. By the end of Investment has been quiet in 2009 with an apparent
2009, construction will be complete on the 15,000 seat, disconnect between buyers and sellers. Buyers are seeking
$185 million downtown Intrust Bank Arena. This facility is adjusted capitalization rates based on the re-valuation of
debt-free and was financed through sales tax revenue. assets. Sellers have not been willing to reduce prices. 2010
Also under construction is the National Center for Aviation should see increased sales with an improving economy.
Training. This 222,000 SF world-class training facility will
provide students the opportunity to receive hands-on, Several student housing projects and new market rate com-
Metropolitan Area real-world training in the areas of general aviation manu- Metropolitan Area plexes were completed in 2009. This has caused an
Economic Overview facturing and aircraft and power plant mechanics. The $54 Economic Overview increase in vacancies, particularly student housing. Due to
million, 1,300-student facility will open in the fall of 2010. the lack of existing zoned multifamily land, very few projects
2009 2009
Population 553,080
will be started in 2010.
Population 604,427 The employment rate has stabilized and is expected to begin
to rise again in 2010, but the economy is predicted to Vacant land is near a historical low. There is a community
2014 Estimated 2014 Estimated effort to utilize techniques to encourage growth through urban
Population 626,523 improve slowly as the aircraft industry rebounds. Financing Population 600,196
for new construction remains challenging. Energy, health- redevelopment. Farm real estate values for the year are $750
Employment care and agricultural sectors are expected to experience Employment higher than the national average.
Population 342,244 stability and modest growth in 2010. Population 268,464
Lexington should weather the recession better than most
Household Household areas due to its broad-based economy, central geographic
Average Income $64,274 Average Income $63,094 location and controlled zoning and development, which
prevents significant overbuilding in the commercial sector.
Median Median

35 36
Wichita At A Glance Lexington At A Glance

RETAIL RETAIL
Downtown $6.00 $ 12.00 $ 10.00 12.6% Downtown $ 10.00 $ 20.00 $ 15.00 25.4%
Neighborhood Service Centers $12.00 $ 16.00 $ 14.00 9.0% Neighborhood Service Centers $ 11.00 $ 21.00 $ 17.00 11.7%
Community Power Center $10.00 $ 22.00 $ 15.00 6.0% Community Power Center $ 15.00 $ 28.00 $ 21.00 9.4%
Regional Malls N/A N/A N/A N/A Regional Malls $ 30.00 $ 75.00 $ 50.00 0%

Office in CBD $ 200,000.00 $ 900,000.00 Office in CBD $ 40.00 $ 60.00

Louisville, Kentucky Baton Rouge, Louisiana
Over the past year, metropolitan Louisville’s commercial real Baton Rouge, the Capital of Louisiana, has withstood the
estate market has weathered the recession relatively well economic slowdown of 2008-2009 relatively well. Weekly
in spite of an unemployment rate that rose four points to wages increased from 2008, the Brooking Institution ranked
10.3% and a limited influx of new businesses to the area. Baton Rouge the sixth-best performing metro area in Q2
In other good news, home sales are up approximately 15% 2009, and Forbes ranked Baton Rouge as the seventh-best
over 2008. mid-sized city for job growth in the country.
The Louisville office market ended Q3 2009 with a vacancy Baton Rouge has remained well insulated due to several
rate of 11.2%, up from 10.7 % in 2008. Class A vacancy economic catalysts. Louisiana State University, with an
stood at 13.3% compared to 13.7% for Class B and 6.9% enrollment of 35,000 calls Baton Rouge home along with
for Class C space, The CBD reported a vacancy rate of 5.9% several other universities and colleges. The inmost port on
for Class A buildings. Net absorption was negative 68,943 the Mississippi River is located in Baton Rouge, generating
SF. The average rental rate in all classes was $15.49/SF, a strong barge and shipping base for industrial growth.
a 0.3% decrease from the end of Q2 2009. Class A sector Numerous plants take advantage of the Mississippi River
rents averaged $19.91/SF, Class B stood at $14.68/SF and access like DOW, Exxon, Shintech, Kaiser and Nucor.
Class C at $12.16/SF. Other economic generators include Baton Rouge as the
Contact The retail market did not experience a significant change Contact state capital as well as having the I-10 and I-12 corridor
over the first three quarters of 2009. The vacancy rate running through the city. This provides a big boost to Baton
NAI Walter Wagner, Jr. NAI Latter & Blum
increased to 8.6%, up slightly from 8.4% in 2008. Net Rouge's hospitality sector. Medical is another large employer
Company Realtors, LLC +1 225 295 0800
absorption wavered between positive and negative territory with five major hospitals in the city.
+1 502 562 9200
throughout the year, with indicators pointing to a relatively Although rental rates and occupancies have been holding
flat or slightly negative result for the year. Vacant sublease strong across the board, Baton Rouge is finally seeing some
space decreased by 3,715 SF. Rental rates also decreased inventory coming on line. Office vacancies for Class A
slightly, ending at $11.97/SF for the year. space slipped to 9% citywide excluding the additional
The industrial market ended Q3 with a vacancy rate of sublease space that could top 100,000 SF or an additional
13.2%, a slight increase over the previous quarter and up 2% vacancy by year’s end. Retail occupancies slipped as
from 12% a year ago. Net absorption totaled positive well in 2009. Overall city vacancies were 12.4%, up 1%
Metropolitan Area 1,299,350 SF. Vacant sublease space decreased, ending Metropolitan Area from a year earlier.
the quarter at 1,251,872 SF. Rental rates were $3.57/SF, an The strongest sector this year has been multifamily with a
Economic Overview increase over the previous quarter. Economic Overview
near 95% occupancy rate citywide. In addition, the highest
2009 2009
Louisville’s downtown arena continues to be a bright spot as price per door was paid for an apartment complex in the
the major construction project in the area. Scheduled to sale of the 300-unit Millennium, which topped $140,000
2014 Estimated open in 2010, the $250 million, multi-purpose arena is 2014 Estimated per door.
Population 1,299,624 expected to generate more than $100 million in downtown Population 787,300
All things considered, Baton Rouge continues to show signs
investment and construction. of a resilient economy with companies like Albemarle
Population 684,103 Population 387,346 establishing its corporate headquarters in the capital city
and outside investors looking at Baton Rouge and the Gulf
Household Household Coast region as a healthy place to invest.
Median Median

39 34
Louisville At A Glance Baton Rouge At A Glance

New Construction (AAA) $ 18.25 $ 25.00 N/A N/A New Construction (AAA) $ 24.00 $ 28.00 $ 27.00 41.0%
New Construction (AAA) $ 18.50 $ 25.00 N/A N/A New Construction (AAA) $ 28.00 $ 28.00 $ 28.00 25.0%
Manufacturing $ 1.50 $ 4.50 N/A 12.4% Manufacturing N/A N/A N/A N/A
High Tech/R&D $ 5.45 $ 8.25 N/A 9.0% High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Community Power Center $ 15.00 $ 20.00 N/A 12.0% Community Power Center $ 23.00 $ 40.00 $ 28.00 6.6%
Regional Malls $ 20.00 $ 40.00 N/A 4.0% Regional Malls $ 12.00 $ 80.00 $ 35.00 N/A

Office in CBD $ 550,000.00 $ 1,900,000.00 Office in CBD $ 900,000.00 $ 1,750,000.00
Retail/Commercial Land) $ 150,000.00 $ 850,000.00 Retail/Commercial Land $ 350,000.00 $ 1,250,000.00

Monroe, Louisiana New Orleans, Louisiana
The commercial real estate market for the Northeast More than four years since Hurricane Katrina and the
Louisiana region has felt the effects of the tough economic ensuing levee failures devastated New Orleans, federal
times but not as deeply as larger metropolitan markets. dollars and rebuilding have helped cushion the local econ-
Although the market has seen a slowdown in activity, the omy against the national recession. The metro area has
area has not experienced a distinct drop in property values lost 0.9% of its jobs since June, compared to 4.1% lost
or lease rates. nationally. The New Orleans area unemployment rose to
Over the last year, Northeast Louisiana has seen several 7.3% compared to 9.5% nationally.
significant business investments awarded to our region. One New Orleans is not immune from the current economic
of these is V-Vehicle Co., a new American car company. crisis. The housing market has stalled with home sales
V-Vehicle selected Monroe as the site for its assembly down 39% and new construction off by 48%. Infrastructure
plant resulting in the addition of 1,400 jobs. V-Vehicle's projects have helped offset the drop in new construction.
capital investment is estimated at $248 million. Two other The office market has remained relatively stable in terms
major announcements were from Gardner Denver Thomas of occupancy and rental rates in the CBD and suburbs. No
consolidating its operations to Monroe with 230 new jobs speculative inventory has been added in either market.
and Foster Farms investing $20 million to renovate and The adaptive re-use of older, Class B and C buildings
reopen a processing plant, thereby saving 1,100 jobs. has actually reduced available supply. The more than
Contact Contact 1.5 million SF of industrial space that was absorbed in the
An analysis by university economists issued a jobs forecast
NAI Faulk & Foster NAI Latter & Blum months following Katrina by contractor’s utility crews and
for 2010 and 2011 for the state of Louisiana and named
+1 318 807 4666 +1 504 569 9300 relief workers has been returned. By the third quarter of
Monroe as the city that will add jobs at the fastest pace.
This is very welcome news after seven years of lost jobs 2009, the inventory of industrial space in the metropolitan
in Monroe. The university economists estimate Monroe will area had climbed to more than 6.9 million SF, producing
lead in the percentage of new jobs, 2.5% or 1,900 jobs in a vacancy rate of more than 13%. The first softening in
2010 and 1,500 jobs or 1.9% in 2011. The growth of the rental rates and pricing is evident.
region through capital investment and job creation will spur The New Orleans economy is heavily dependent on the
an acceleration of economic activity both now as well as tourist and hospitality industries. Not surprisingly, the
into the future. Louisiana and our region will continue to cutback in corporate travel, fewer and smaller meetings
compete for new business investment for the state and and the drop in consumer spending has reduced visitation
Metropolitan Area the region. Metropolitan Area to the City. The loss of service sector population post-
Economic Overview We anticipate an increase in new real estate development Economic Overview Katrina and higher local labor costs have reduced the
2009 and expansion opportunities as a result of these new ad- 2009
profitability of area hotels and restaurants in the face of
Population 171,344 ditions to our region. Population 1,052,131 decreasing revenues. Most industry observers do not
expect recovery in this sector until 2012.
Population 170,501 Population 1,078,373 The lodging sector has produced unprecedented
transaction volume. Since 2006, hospitality investment in
Employment Employment the CBD involved 2,894 CBD-French Quarter hotel rooms,
Population 91,368 Population 628,467 with an aggregate value of $405 million. An additional $74
million has been invested in the acquisition of 1,994
Household Household
Average Income $52,956 Average Income $67,632 storm-damaged rooms resulting in a total post-storm
investment of $479.2 million in the sector.
Median Median

39
Monroe At A Glance New Orleans At A Glance

Bulk Warehouse $ 2.50 $ 4.50 $ 3.50 N/A Bulk Warehouse $ 2.00 $ 3.75 $ 2.90 13.2%
RETAIL RETAIL
Neighborhood Service Centers $ 8.00 $ 15.00 $ 11.50 N/A Neighborhood Service Centers $ 12.00 $1 8.00 $ 15.00 15.0%
Sub Regional Centers $ 12.00 $ 18.00 $ 15.00 N/A Sub Regional Centers $1 5.00 $ 29.00 $ 22.00 10.0%

Residential N/A N/A Residential $ 30,000.00 $ 650,000.00

Greater Portland, Southern Maine Baltimore, Maryland
Office leasing has seen a noticeable slowdown in transac- Baltimore's fundamentals have helped to insulate the city
tions. A lack of activity and demand for space, with from the current financial climate. The downtown office
an approximate 10% vacancy rate, has resulted in a very market continues to gravitate to the water as Inner Harbor
"pro-tenant" atmosphere. Landlords in all sectors of the East continues to build out. The new 600,000 SF headquar-
market are making concessions to either induce new ten- ters for Legg Mason opened in 2009 as the largest office
ants to come to their buildings or to entice existing tenants presence to date in that area. What will happen to the former
to stay at reduced rates. Sale of medical/office buildings has Legg headquarters at 100 Light Street remains a question.
slowed and capitalization rates have risen, particularly in Buoyed by its proximity to Washington, DC, and the presence
suburban sectors. of multiple government installations, Baltimore, the East
The inventory of viable office investment properties is limited Coast’s farthest inland seaport, enjoys a marginal insulation
and the number of capable buyers remains sparse given from the global economic slowdown. The Social Security
the tightened commercial lending situation. Speculative Administration, the Health Care Financing Administration,
construction of office buildings has stalled as ample existing the National Security Agency, Ft. Meade and Aberdeen
space is available at rates below what would be needed to Proving Ground are all federal government operations in the
justify new construction. Lenders continue to shy away from area that employ Marylanders at well above average salaries.
these types of projects. These agencies require significant private contractor support
Contact Contact which, in turn, supplies even better paying jobs.
Big box expansion, which led the previous growth cycle, has
NAI The Dunham Group NAI KLNB, LLC
come to a standstill. Target, Home Depot, Kohl's and However, Baltimore is not immune to the credit crunch.
+1 207 733 7100 +1 410 321 0100
Wal-Mart supersizing have halted expansion in Maine. The market has witnessed some recovery at the end of Q2.
Spaces vacated by Circuit City, Linen's & Things, Tweeter With asking rates hovering just shy of the $5 NNN mark for
and other bankrupt retailers, have been very slow to industrial space, developers have sharpened their pencils
re-lease. This also tends to be the case with vacated after sitting on recently delivered product in a market that
national restaurant sites. Vacancy rates for power centers was flooded with new construction for most of 2008. Asking
and retail strips remain manageable, provided there is not rates were previously based on construction costs and
another large wave of store closings. Walgreens continues projections that were developed during the boom times
to construct new stores in Maine, albeit at a slower pace. of 2006 and 2007. The tenant has become king in the
Rents have declined. Sam's Club has been evaluating industrial, office and retail markets, with multiple opportunities
Metropolitan Area opportunities in Maine and Tractor Supply is building several Metropolitan Area to upgrade space at competitive rates and aggressive terms.
Economic Overview new stores. McDonald's continues its program of upgrading Economic Overview Well-financed users seeking to purchase buildings remain
2009
stores as well as adding new stores in selected markets. 2009
on the sidelines, patiently waiting for the market to hit what
Population 509,558 Tim Horton's has initiated limited expansion in northern and Population 2,686,982 they perceive to be the bottom.
central Maine and there has been additional supermarket Things might get worse before they get better. New
2014 Estimated expansion in secondary markets. Lower-end discount stores 2014 Estimated
construction continues in the downtown market and nearly
Population 500,330 have also been active, including Ocean State, Marden's, Population 2,732,754
1 million SF of space is expected to enter the inventory
Employment
Chapter 11 and Save-A-Lot. These stores were presented Employment over the next year. Owners can fight by keeping an eye
Population 301,558 with opportunities to occupy prime vacancies at low rates. Population 1,323,649 on operating expenses and taking advantage of saving
Household
Maine has not escaped the effects of the national and global Household
wherever possible.
Average Income $70,528 recession. The inventory of industrial space has ballooned Average Income $83,898
since the beginning of the year. However, the increasing
Median vacancy rate has resulted in lower lease rates which are Median
Household Income $54,555 providing tenants with attractive opportunities in the market. Household Income $64,415

42 38
Greater Portland, Southern Maine At A Glance Baltimore At A Glance

RETAIL RETAIL
Downtown $ 16.00 $ 30.00 $ 25.00 5.0% Downtown $ 15.00 $ 50.00 $ 22.00 N/A
Neighborhood Service Centers $ 10.00 $ 18.00 $ 14.00 5.0% Neighborhood Service Centers $ 15.00 $ 50.00 $ 23.00 N/A
Community Power Center $ 10.00 $ 22.00 $ 16.00 5.0% Community Power Center $ 10.00 $ 16.00 $ 15.00 N/A

Land in Office Parks $ 150,000.00 $200,000.00 Land in Office Parks $ 125,000.00 $ 1,500,000.00
Land in Industrial Parks $ 125,000.00 $150,000.00 Land in Industrial Parks $ 100,000.00 $ 1,350,000.00
Office/Industrial Land - Non-park $ 70,000.00 $150,000.00 Office/Industrial Land - Non-park $ 50,000.00 $ 700,000.00
Retail/Commercial Land $ 250,000.00 $750,000.00 Retail/Commercial Land $ 300,000.00 $ 2,000,000.00
Residential (per acre) $ 65,000.00 $300,000.00 Residential N/A N/A

Suburban Maryland Boston, Massachusetts
Suburban Maryland includes two primary counties and three While the Massachusetts economy is still in a downturn, the
secondary counties. Both Prince George’s and Montgomery rate of deterioration has slowed considerably. According to
counties border Washington, DC, and have the largest MassBenchmarks, economic activity in Massachusetts
populations. Calvert, Charles and Frederick Counties further declined at a 1.1% annualized rate in Q3 2009, compared
outside of Washington, DC, and have smaller populations; to 4.2% in February 2009. The state’s education, health
however, these areas are continuing to grow due to jobs services, professional services and information sectors have
markets in both Washington, DC, and Baltimore, Maryland. remained relatively stable despite strong recessionary
In southwestern Prince George’s County, the name of pressures from the financial services sector.
Andrews Air Force Base has been changed to Joint Base Asking rates for office space continued to fall in 2009, but are
Andrews–Naval Air Facility Washington. This change comes leveling off. With vacancy rates climbing to 9.5% in the CBD
as currently the base is having over $1 billion in renovations and 16.5% in the suburbs, there is no shortage of supply,
and construction, and is expected to grow even more in the allowing tenants with solid financials to take advantage of
near future. Andrews is still the second largest employer in tenant-favorable conditions. Significant transactions include
the State of Maryland, next to the University System, which Verizon’s 200,000 SF lease at 185 Franklin Street in Down-
has recently opened its UMUC Campus in Largo. In northern town Boston and 3Com Corporation’s 130,000 SF lease at
Prince George’s, a limited industrial land supply is expected 350 Campus Drive in Marlborough.
Contact to remain robust and keep this market strong. Contact
The industrial market continues to trudge along as asking
NAI Michael NAI Hunneman
The office sector is expected to grow in the near future as rates have dropped to an average of $6/SF NNN. Vacancy
+1 301 459 4400 +1 617 457 3400
the Federal Government takes aim at the county’s undevel- rates have hit their highest level since Q1 2005. One
oped land, which is unmatched in the Washington, DC, significant transaction is Best Buy’s build-to-suit lease of a
metropolitan area for built-to-suit projects. Montgomery new distribution facility at 140 Depot Street in Bellingham,
County has extensive infrastructure in place due to the large totaling 238,370 SF.
amount of science and technology firms located in the area Lack of liquidity continued to plague the investment market
along the I-270 corridor. This area hosts over 200 biotech in 2009. A majority of investment sales have been limited
companies, employs over 100,000 advanced technology to smaller deals that can be locally funded. The
workers and has attracted the highest concentration of PhDs multifamily market remains relatively active; one of the
in the nation. The new Inter County Connector (ICC) will largest deals in 2009 was the sale of a 90 unit multifamily
Metropolitan Area connect I-270 with I-95, allowing a 12-minute travel time Metropolitan Area
portfolio in Arlington for $12 million. Capitalization rates
Economic Overview between these two counties, thereby alleviating traffic on Economic Overview have increased to 7.5% for multifamily sales, 9% for office
2009
I-495 the Capital Beltway and allowing the growth of both 2009 property sales and 9.5% for retail property sales.
Population 5,331,775 the Industrial and Office markets. Population 4,536,261
The retail market has also felt the impact of the economic
This market has several moving parts. It hosts an area turmoil with lower rental rates and significantly higher
Population 5,398,312 developed and steadily thriving in Montgomery, an up-and- Population 4,669,975 vacancy in the downtown. Super H-Mart’s 51,000 SF lease
coming area with major developments in Prince George’s, at 3 Old Concord Road in Burlington is one of the few deals
Employment as well as areas unaffected now but poised for future devel- Employment
that was completed in 2009.
Population 2,934,389 opment in Charles, Calvert and Frederick. Population 2,741,072
Although the Boston market continues to slide, the rate of
Household Household decline is showing significant signs of deceleration. If this
trend of decelerating decline continues, we can anticipate
Median Median the beginnings of a stabilizing market in 2010, with more
Household Income $81,001 Household Income $68,969 sustainable growth trends returning in 2011.
37 39
Suburban Maryland At A Glance Boston At A Glance

New Construction (AAA) N/A N/A N/A N/A Premium (AAA) $ 45.00 $ 55.00 $ 50.00 17.0%
RETAIL RETAIL


Western (Greater Springfield), Massachusetts Detroit, Michigan
Greater Springfield is definitely in a recessionary climate The continual decline of the auto industry weighed heavily
with negative absorption in the office, retail and industrial on real estate markets throughout the Metro Detroit area in
sectors and vacancy rates that have continually increased in 2009. Sweeping layoffs have not only hampered Detroit’s
the Western Massachusetts region. Overall, demand for industrial market, but the commercial and retail markets
commercial space has slowed in the past year as national continue to suffer as well. Medical development drove most
companies have scaled back, or stopped expanding alto- real estate growth but is beginning to show weakness.
gether, due to a drop in consumer spending. The office market has developed a churning trend with many
Few retailers are expanding in the area with the exception users taking advantage of small spreads in rates between
of Lowes, which is constructing a new retail facility in Hadley classes. Though rate gaps have narrowed, landlords are
and is looking to develop a new retail facility in Holyoke in hesitant to offer tenant improvement incentives as financing
the next two years. The Western Massachusetts industrial and cash remain scarce. New demand has entered the
market remains flat, and as a result, there continues to be marketplace in the form of renewable energy and film
an oversupply of industrial space as manufacturers continue production, yet these industries do not have the critical mass
to restructure and downsize. The industrial market vacancy to benefit the entire market.
in the area has increased from approximately 9-12% and Industrial vacancy continues to rise above 20%, primarily
has resulted in the average lease rates decreasing from due to the hard hit automotive industry. With minimal
Contact approximately $4/SF to $3.75/SF. We continue to receive Contact
traditional industrial demand, renewable energy firms are
NAI Samuel D. Plotkin a number of inquires for warehousing and distribution NAI Farbman
beginning to look at flex space as an attractive option for
Associates companies searching for modern, high bay facilities with +1 248 353 0500
solar and wind technologies as these industries are currently
+1 413 781 8000 24’ to 26’ height, which are limited and seem to result in more R&D focused. Ford Motor is in the process of selling
new construction. 4.7 million SF of plant space to an energy coalition aimed at
The weak economy has resulted in declining demand for creating new solar technologies.
office space in both the suburban and downtown markets. Retail power centers have begun to feel the effects of falling
Landlords are trying to combat rising vacancies by lowering consumer spending and increasing unemployment with
rental rates and increasing concessions to retain existing many anchor and smaller tenants vacating. The largest hit
tenants and attract new ones. The Massachusetts Develop- to the retail market came from sweeping closures of Circuit
ment Finance Agency recently completed the purchase of City locations throughout the Metro Area. Many of these
Metropolitan Area the former Federal Building located at 1550 Main Street Metropolitan Area
spaces were replaced with significant investments from
Economic Overview in downtown Springfield. The building will become the home Economic Overview Meijer and LA Fitness, helping to stabilize the sliding
of the Springfield School Department and offices for 2009 demand for retail space. As vacancy continues to lead
2009
Population 675,599 Baystate Health. Population 4,451,621 national averages, retail will show weakness throughout
Constant changes in commercial real estate are hard to 2010, specifically for in-line applications.
658,190
adjust to, but where others might see challenges, we see Population 4,408,696 The overall real estate market in Metro Detroit should
Population
opportunities. We remain hopeful that we will see a drastic continue a decline through 2010 until new industries gain
Employment turnaround in 2010. The current environment is a great Employment
traction and automotive profits return. With aggressive tax
Population 344,760 opportunity for companies in Western Massachusetts to Population 2,226,596
incentive programs in place, Detroit should slowly see
begin new businesses and expand locations. Household demand return in late 2010, most likely in the form of
Household
Average Income $62,737 Average Income $69,120 energy research and development.
Median Median

38 39
Greater Springfield At A Glance Detroit At A Glance

RETAIL RETAIL

Land in Office Parks $ 60,000.00 $ 100,000.00 Land in Office Parks $ 40,000.00 $ 1,041,666.00

Grand Rapids, Michigan Lansing, Michigan
The region is in an era of transition as it evolves away from The Lansing area and tri-area is composed of Ingham, Eaton
its traditional reliance on the furniture and auto related and Clinton Counties. Lansing's population remains steady
industries. While most segments in West Michigan experi- at approximately 450,000. In 2009 the market nearly
enced below-average growth, if any, the emerging life grinded to a halt but turned around with signs of life in the
science industry continued to propel transactions through fourth quarter. As the debt market corrects itself in 2009, we
2009. In general, vacancy was up and rent was down. anticipate the number of transactions to increase into 2010.
The office sector reflected the ups and downs of an overall The economic trend continued with below average growth
tough year. Activity levels improved late in the year as in all segments of the market. Lansing's office market has
tenants were in the market checking available deals and approximately 10 million SF with the largest concentrations
incentives being offered. Tenants are renegotiating rates in the CBD and East Lansing. The market had steadily
and terms rather than dealing with disruption and cost increasing vacancy rates nearing 25% while the US vacancy
of moving. The medical sector continues to grow as the rate averaged 15%. As vacancy rates increased in the market,
Michigan State medical school and the Van Andel Institute, rental rates continued to drop and landlords were forced to
Phase II, will be completed in 2010, and Grand Rapids offer significant incentives to attract tenants. The forecast
becomes a regional medical care provider. is that pricing should remain relatively flat or declining
Demand for industrial property in 2009 has been soft. Many mainly due to the uncertainty of the market.
Contact Contact
companies, unsure of their futures, had difficulty making The industrial market has shown significant declines in
NAI West Michigan NAI Mid-Michigan
long term real estate decisions. In 2010 we expect to see users and user interest. The market’s largest owner users
+1 616 776 0100 Vlahakis Commercial
little new development. Rather, existing buildings will be are General Motors and Meijer. Both companies have a
+1 517 487 9222
redeveloped and used for growing industries in West Michigan direct impact on the industrial market, occupying more than
such as medical, wind and solar energy, component 20% of the total available space. The largest concentration
manufacturing, food processing and related businesses. of industrial space can be found in West Lansing (Eaton
The retail sector has also seen increased vacancy and lower County), which comprises nearly 50% of the gross leasable
average rents over the past year. With weak leasing activity, product in the market. General Motors and suppliers collec-
landlords are being forced to be more flexible in negotiations. tively have brought approximately 2 million SF of Class A
With tightened financial markets, landlords also had difficulty Industrial space to the market. This has shuffled the deck in
obtaining financing for tenant improvements. Neighborhood the industrial market, which consisted of older obsolete
Metropolitan Area Metropolitan Area buildings. Vacancies have increased over the past two years
retail centers experienced declines in rental rates and
Economic Overview tenants are finding a challenging business environment. Economic Overview increasing from 18% in 2008 to near 25% in 2009. The
2009 Although many restaurants have been cautious about 2009
outlook is fair but we expect absorption to be slow.
Population 784,632 expansion, the West Michigan market has seen some activity Population 460,491 The retail market consists of nearly 14 million SF, primarily
in 2009 by national restaurants such as Sonic, Culvers and located in regional malls and strip centers. Factors that
Population 803,240 Golden Corral. Population 469,554 contributed to growth in previous years were related to
Despite the downturn there is some great news in West activity from drugstores and bank branch expansion. We can
Employment
Michigan, which includes the Farmer’s Insurance announce- Employment expect steady economic trends for 2010.
ment of 1,600 added jobs and 275,000 SF of new office
Household construction. Many tenants are renegotiating reduced rents Household
Average Income $64,503 in exchange for extended leases. Average Income $60,427
Median Median

35 35
West Michigan At A Glance Lansing At A Glance

RETAIL RETAIL

Office in CBD $ 1,100,000.00 $ 5,000,000.00 Office in CBD) $ 100,000.00 $ 400,000.00
Land in Industrial Parks $ 50,000.00 $ 125,000.00 Land in Industrial Parks) $ 20,000.00 $ 80,000.00

Minneapolis/St. Paul, Minnesota Kansas City, Missouri
Minneapolis/St. Paul, the “Twin Cities,” are home to 19 Kansas City, a bi-state community of over 2,000,000 people,
Fortune 500 companies in industries driven by commerce, ranks in the top half nationwide for growth during the
finance, healthcare and high-tech companies. The diverse recession. Bioscience, healthcare and bulk distribution have
11-county metro area has an annual population growth been key performers. The industrial sector remains healthy
of 2-3%, a highly educated workforce and low rates of with 7.25% vacancy and a fairly narrow margin between
unemployment, producing a stable environment even during quoted and negotiated lease rates. Coleman’s 1,100,000
unpredictable times. SF distribution center opened at year-end 2009. BNSF/Allen
Vacancy rose steadily throughout 2009 as rental rates Group’s intermodal project in Johnson County, Kansas is
decreased slightly in all property types. Office vacancy proceeding in Edgerton with support from the city, county
market-wide is 14% with the highest vacancy in Class B and state.
space. Industrial vacancy sits at 10% and retail vacancy is The CenterPoint/KC Southern Railway intermodal center at
about 5%. Tenants exercise caution when it comes to the former Richards-Gebaur Airport is advancing. Phase I
leasing or acquiring new space, renewing existing leases opened in spring 2008 with $30 million site grading, streets,
rather than absorbing relocation costs. Landlords are offering sewers and utilities. This intermodal serves as an alternative
discounted rates to tenants renewing 12 to 18 months in to the congested Los Angeles port system by shipping from
advance to ensure spaces remain filled. Mexico’s Port of Lazaro Cardena, an increasingly significant
Contact Contact gateway for imports from Asia.
Leases of 10,000 SF or less are driving the industrial market
NAI Welsh NAI Capital Realty
as retail spaces vacated in late 2008 and early 2009 are Kansas City’s office market vacancy increased throughout
+1 800 897 7701 Kansas City
filled by a host of new eateries. Major leases this year most submarkets in 2009. However, this sector is projected
+1 913 469 4600
included a 929,800 SF Target Corporation office renewal, to begin improving in late 2010. The south Johnson County,
the 300,000 SF Silgan Containers industrial lease and the Kansas submarket, the metro’s most active, should rebound
30,000 SF Home Valu Interiors retail lease. first. Large sublease offerings were a factor in increased
Market activity has grown throughout 2009 and will incentives and depressed rates.
continue in 2010. Movement is due to consolidation and Healthcare, bioscience research and telecommunications
downsizing, as opposed to actual growth. There is a large impact demand. Two of the largest transactions occurred at
amount of “shadow” space in industrial and office segments Sprint’s headquarters with healthcare companies Apria
Metropolitan Area as companies downsized but did not release unused space. Metropolitan Area Healthcare and Care Centrix opening new operations.
That space needs to be filled before new construction de- Telecommunication companies Sprint and CenturyLink
Economic Overview mand will return. Top construction projects under way in Economic Overview (formerly Embarq) offered large blocks of space new to the
2009 2009 were the Excelsior Crossings Office Park – Bldg. C, 2009 market at Sprint’s Headquarters and CenturyTel’s premises
Population 3,263,689 2201 W 94th Ave. in Bloomington and BMW of Minnetonka. Population 2,016,662 at Glenwood Place.
Transaction volumes are down as are pricing and value. The Wizards soccer team is flipping its stadium development
Population 3,398,253 Looking ahead, we'll see more foreclosures, forced sales Population 2,095,104 along with a significant Cerner Corporation office project
and increased transactional activity as lenders liquidate from Missouri to Kansas. Developers are moving forward at
2,035,357
assets. The largest sales in 2009 included the 116,000 SF 1,127,170
Village West/Kansas Speedway in Kansas City, Kansas due
Syngenta Headquarters office building in Hopkins, the to greater economic incentives available in Kansas. Cerner
Household 335,400 SF industrial building located at 13201 N Wilfred Household will create up to 4,000 jobs in this development, the largest
Average Income $82,364 Lane in Rogers, and the 97,535 SF Hastings Marketplace. Average Income $68,837 jobs influx in Kansas City Kansas in years.
Median Median The retail sector slowed dramatically in 2009 and improve-
Household Income $69,755 Household Income $59,541 ment is unlikely until at least 2011. Corbin Park in Overland
Park opened with Von Maur, but has since encountered
37 37 numerous contractors’ liens and minimal leasing. Lee’s
Summit’s Summit Fair, a 395,000 SF lifestyle center
opened, anchored by Macy’s and JC Penney.
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) $ 40.00 $ 75.00
Land in Office Parks N/A N/A Land in Office Parks (per acre) $ 150,000.00 $ 480,000.00
Land in Industrial Parks N/A N/A Land in Industrial Parks (per acre) $ 40,000.00 $ 200,000.00
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park (per acre) $ 35,000.00 $ 175,000.00
Retail/Commercial Land N/A N/A Retail/Commercial Land (per acre) $ 26,000.00 $ 1,050,000.00
Residential N/A N/A Residential (per acre) N/A N/A

St. Louis, Missouri Bozeman, Montana
The Greater St. Louis Metropolitan area consists of 16 counties Bozeman is the primary urban center in Southwestern
in Missouri and Illinois and has a population of 2.8 million, Montana and is the seat of Gallatin County with a popula-
making it the 18th largest metropolitan area in the nation. tion of 90,000. Located just 90 miles north of Yellowstone
The office market has been slowly declining over the last National Park and only 45 miles north of the Big Sky resort
year with slight price erosion and flat demand. Vacancy rates community, Bozeman represents an attractive primary and
increased to 11.8% in 2009 compared to 10.8% at the end secondary home market.
of 2008.The office sector is expected to weaken further in Anchored by an economy rich in agriculture, the greater
2010 when banks increase foreclosures. Bozeman market has emerged as a trade region built on the
With one exception, development projects such as the business spin-offs of research successes of Montana State
Brown Shoe Company headquarters and Ballpark Village University, making Bozeman one of the leading smaller
remain on hold. The Centene Corporation building, a urban centers in the nation. Bozeman's economy continues
485,250 SF high-rise in Clayton, is the only significant to be a primary performer in the state with 3.2% annual
development expected to deliver in 2010. growth. The city enjoys a mature construction industry,
significant airline connections, recreational industries,
The industrial market continues to suffer from an excess of emerging regional medical community and high-tech small
speculative space resulting in elevated vacancy rates and business.
Contact decreased rental rates. Vacancy rates increased to 9.0% in Contact
2009 compared with 8.1% at the end of 2008. Average A substantial growth in residential development over
NAI DESCO NAI Landmark
rental rates dropped in 2009 to $4.21/SF compared with the past 10 years stimulated county-wide development
+1 314 994 4444 +1 406 556 5005
$4.35/SF at the end of 2008. No significant projects are across the Valley. While the Southwest Montana economy
currently under construction. However, agents are reporting is somewhat cushioned from the volatility experienced
an increase in tenant and buyer inquiries, which could signal nationally in recent months, there has been a decline in
an end to the inactivity. demand for office and retail product that will likely slow the
absorption of a small oversupply. Vacancy is capped at 5%
The retail sector has been the hardest hit, seeing little in the office segment and 8% in the retail markets. Market
activity in the last two years. Tenants continue to vacate or rent rates remain stable, in the range of $12 to $14/SF/per
seek rent reductions, causing lease rates to decrease and year for suburban Class A office space. New retail product
vacancies to increase. There were no new developments offers opportunity, principally in the form of a new 60,000
Metropolitan Area delivered in 2009. Metropolitan Area SF development at South 19th Avenue and Oak Street, and
Economic Overview As an exception to this inactivity, several newcomers are ac- Economic Overview an outdoor lifestyle development at College Street and West
2009 tively seeking locations. CVS/Pharmacy, Dunkin Donuts, Five 2009
Main. In the industrial sector, warehouse demand has
Population 2,812,578 Guys Burgers & Fries and ChickfilA are expected to open Population 103,096 weakened slightly with the decline in new housing starts.
multiple locations in the next year.Nordstrom Rack and Von Demand is limited for high-tech flex and R&D space.
2014 Estimated Maur have also announced plans to enter the market, but 2014 Estimated
The historic Downtown Bozeman retail and office markets
the timing remains uncertain. Retail prospecting is expected remain one of the state's finest. New private investment
Employment to increase in 2010 with little urgency to close until 2011. Employment downtown has been stimulated by a $12 million,
Population 1,497,458 Population 40,064 435-car parking garage. A natural gas explosion in March
Household
of 2009 destroyed a quarter of a city block that is now
Household
Average Income $68,844 Average Income $69,488 in redevelopment.
Median Median

Median Age 38 Median Age 33.7
St. Louis At A Glance Bozeman At A Glance

RETAIL RETAIL


Missoula, Montana Lincoln, Nebraska
Missoula, also known as the “Garden City,” is Montana’s Lincoln is the capital of Nebraska and represents its second
second largest city composed of approximately 67,165 largest city. The local economy remains healthier than most
residents. Missoula is western Montana's center of education, US markets due to the presence of state government and
medicine, business, retail shopping, entertainment, culture the University of Nebraska. However, the office, retail and
and recreation. Traditionally timber and mining were the industrial sectors have not been entirely impervious to the
primary industries throughout the state. However, Missoula’s current economic events as new activity has diminished.
economy has diversified with growth in tourism, retail, The city delayed its public financing vote to spring 2010 on
manufacturing, trucking and customer services. a new arena project west of the CBD.
Residential home sales have slowed significantly, with most Lincoln’s office vacancy rates edged higher across the
sales occurring in the starter home sector. In Missoula market. Asking lease rates softened and landlords offered
County, 994 homes sold in 2008 with the median home more concessions to serious tenants. New space was
price averaging $215,000. First Interstate Bank constructed predominantly build-to-suit with minimal speculative space,
a new six-story, 86,844 SF office building that will house its bringing the total office inventory to over 12 million SF.
downtown branch and administrative offices along with The CBD continues to attract investment in adaptive reuse of
other businesses. Another six-story office building with older buildings primarily into residential condominiums and
48,000 SF owned by the Garling, Lon and Robinson law apartments. Lincoln Flats, a $6 million mixed-use project,
Contact firm, is under construction and will be completed in 2010. Contact
created retail, office and 24 residential units downtown.
NAI Crowley Moore The Old Mill Site (former Brownfield) located across the Clark NAI FMA Realty
+1 406 721 1111 Fork River near Missoula's Downtown, is expected to receive +1 402 441 5800 The retail market remained challenging, as vacancies rose
subdivision approval in 2010. The site will be developed with across most submarkets and types. Retailers who predicted
single-family residential, multifamily residential, retail and growth have since put expansion on hold and several new
office space. Office vacancy estimates are 6% and retail developments have stalled due to lack of national retailer
estimates are 8% for 2009. response. However, tenants expanding in the current econ-
omy are finding greater choices and lower rents. Success
Missoula’s Trade Area population has steadied with Tertiary stories in 2009 include Staples, which broke ground on its
Trade Areas in 2009 estimated at over 360,000. Retail first store in Lincoln. Several new restaurants are looking to
expansion on North Reserve Street has stalled, with one big enter the market, and CVS, Jimmy John’s, Verizon and Snap
box location now vacant. Restaurant expansion continues with Fitness continue to expand their presence. The hospitality
Metropolitan Area only the addition of Five Guys Burgers on East Broadway. Metropolitan Area
sector is encouraging with several new hotel projects under
Economic Overview A sewer main extension has been constructed along High- Economic Overview construction or planned.
2009
way 10 to the Wye (airport area), allowing for the relocation 2009
of the Missoula National Guard Armory. The Amory is Lincoln’s industrial market saw an increase in sales and
scheduled to be completed in 2010. leasing activity in 2009 as companies took advantage of
2014 Estimated 2014 Estimated lower rental rates and vacancies, but it was not enough to
Population 128,278 Development in multifamily units has slowed since the peak Population 338,823 stop the upward trend of overall vacancy, which increased
in 2007, with average apartment rental rates at $663 to 13.5%. The most notable industrial project was a 72,000
Employment per month. Occupancy levels are good, averaging better Employment
SF addition to a cold storage facility.
Population 63,510 than 95%. Population 201,481
The 2010 forecast suggests a continuation of a slower
Household Household market, but Lincoln’s economy should fare better than the
national economy. Higher quality of life and a lower cost of
Median Median living index make Lincoln an attractive place to invest and do
Household Income $43,433 Household Income $54,697 business.
35 33
Missoula At A Glance Lincoln At A Glance

RETAIL RETAIL

Office in CBD $ 50.00 $ 70.00 Office in CBD $ 25.00 $ 45.00
Land in Office Parks $ 8.00 $ 12.00 Land in Office Parks $ 130,000.00 $ 1,000,000.00
Land in Industrial Parks $ 5.00 $ 8.00 Land in Industrial Parks $ 75,000.00 $ 200,000.00
Office/Industrial Land - Non-park $ 4.00 $ 10.00 Office/Industrial Land - Non-park $ 45,000.00 $ 350,000.00
Retail/Commercial Land $ 10.00 $ 30.00 Retail/Commercial Land $ 196,000.00 $ 1,200,000.00
Residential $ 2.00 $ 4.00 Residential $ 25,000.00 $ 65,000.00

Omaha, Nebraska Las Vegas, Nevada
Although Omaha has remained somewhat insulated from Southern Nevada has been one of the most robust economies
the economic crisis, the impact is still being felt. Nowhere is of its size in the country. Broader market conditions have
this more evident than commercial real estate. In the past shifted the growth-driven environment in and around Las
year, Omaha has seen increased vacancy rates across Vegas, including its core tourism industry, but the funda-
the board, historic rental rate reductions, longer rental mental structure remains the same. Declines in end-user
abatement periods and increased leasehold improvement and investor demand over the past two years have created
allowances. But it isn't all doom and gloom, and some challenges within the commercial real estate sector while
sectors still hold the promise of stability. providing opportunity for strategic acquisitions and those
Although overall rental rates are up, vacancy rates are down, with a vision for the future.
and there’s a lot to get excited about in Omaha. Several During 2009, the commercial office market posted a
redevelopment construction projects are taking place, vacancy rate in excess of 22%, representing an all-time high
including Aksarban Village, a mixed-use urban lifestyle as annual negative absorption was reported for the first time
setting near the University of Nebraska at Omaha. The in history. With inventory reaching 50 million SF and
development includes approximately 750,000 SF of office over 11 million SF of vacant space, the market experienced
space, 250,000 SF of retail, a 139-room Courtyard by downward pressure on pricing with average asking rents.
Marriott and 500 housing units including multifamily and The number of projects actively moving forward continued
Contact condos. Another exciting development is Midtown Crossing, Contact
to shrink dramatically, while several stalled construction
NAI NP Dodge a $250 million mixed-use urban development. Midtown NAI Las Vegas
projects signal corrections are under way. The retail market
+1 402 255 6060 Crossing will feature a pedestrian-oriented retail and enter- +1 702 796 8888
experienced a similar market shift as a number of anchor
tainment environment composed of seven buildings and tenants vacated spaces. The move-outs were a direct result
approximately 200,000 SF of space. of corporate financial issues for regional and national chains
In the industrial market, rental rates have risen but overall such as Circuit City and Linens N Things. Local fundamen-
vacancy rates are down. In 2007, the average vacancy rate tals also impacted retailers. Total inventory reached 52
was 8.3% compared to the current 6.3%. In 2007, the million SF, while vacancies surged to 10%, a figure that hov-
average rental rate for industrial property was $4.69; this ered around 4% during the past decade.
year it is $4.80. Expansions going forward will be limited to pre-leased,
Metropolitan Area The Omaha office market can best be described as stagnant. Metropolitan Area
anchor spaces by known brands. Niche opportunities have
Rental rates have risen steadily over the past three years, prevailed for Hispanic grocers and discount retailers, a trend
from $13.55/SF in 2007 to $16/SF at the end of the required to fill existing product. Industrial product also expe-
2009 Q3 2009. However, overall vacancies rates are down. The 2009 rienced escalating vacancies that reached beyond 12% as
Population 838,875 suburban market has experienced increased pressure to Population 1,949,304 total inventory exceeded 103 million SF. Vacancies are
lower rates, which has put pressure on every other sector. significantly higher than the 10-year historical average of
Population 858,579
With additional space anticipated to be on the market in Population 2,228,122
8%. Speculative development in the sector remains limited
2010, an increase in vacancy rates is expected. while net absorption remained negative throughout the year.
Omaha has a cost of living that’s 10-13 % below the 1,087,815
In December 2009, MGM Mirage’s $8.5 billion City Center
national average, a consistently low crime rate and the debuts with 18.5 million SF of resort and residential devel-
Household entertainment and cultural amenities of a city twice its size. Household opment along the famous Las Vegas Strip. The property is
Average Income $67,576 In summary, it’s an excellent place to live, work and play. Average Income $73,925 expected to act as a catalyst for increased visitation, which
should have rippling effects throughout the economy.
Median Median

Median Age 35 36
Median Age
Omaha At A Glance Las Vegas At A Glance

RETAIL RETAIL

Office in CBD $ 300,000.00 $ 1,300,000.00 Office in CBD $ 450,000.00 $ 825,000.00
Land in Industrial Parks $ 130,000.00 $ 1,000,000.00 Land in Industrial Parks $ 100,000.00 $ 500,000.00

Reno, Nevada Manchester, New Hampshire
Traditional economic drivers in Reno are tourism and gaming The Manchester, New Hampshire, market is often classified
with warehousing/distribution the leading non-gaming as a suburb of the Boston real estate market, but a distinction
related industry. Gaming revenues declined more than 23%, should be drawn. As one draws concentric highway circles
the visitor count dropped by a similar amount and industrial around Boston, the “128 Belt,” then the “495 Belt,” the
activity was less than 60% of the average for the previous occupancy levels and rental rates for most asset classes
eight years. Construction employment dropped precipitously, have been sinking. However, just outside the last of the
contributing significantly to an unemployment rate of more beltways is the New Hampshire border and indicators seem
than 13.2%. to improve.
The office market experienced a record high vacancy rate The first main indicator is that New Hampshire’s unemploy-
resulting in landlords making deals well below already ment, hovering a shade under 7%, is nearly two points
reduced asking rates, with free rent the concession of better than the national average. New Hampshire’s lack of
choice. Less than 10,000 SF of new construction occurred income and sales taxes keep it a fairly stable force in the
in 2009, with virtually no speculative office buildings region, being one of the few states in the New England area
planned for 2010 as weak demand is expected to continue. to boast positive net migration five out of the last six years.
Demand for industrial space was down for the third consec- However, as the New Hampshire legislature prepares its
utive year and the vacancy rate reached an all-time high of biennium budgets, job losses in the public sector and
Contact Contact increased taxes are sure to be on the docket, which could
more than 15%. There was virtually no speculative develop-
NAI Alliance NAI Norwood Group hurt the 2010 outlook. The public sector will contribute
ment during 2009. Market occupancy receded by more than
+1 775 336 4600 +1 603 668 7000 to real estate growth in the Manchester area, as Federal
3% (almost 2 million SF) and effective rents dropped
15-25%, with a concomitant decrease in property values. Stimulus money has been used for the completion of the
“Airport Access Road.” This links the Everett Turnpike, Route
The retail market saw an overall vacancy rate of 15.6%, with 3 and the Manchester Boston Regional Airport. The road will
a number of local and national tenants vacating their spaces. improve commuting, shipping and open access to land on
Some projects in the pipeline are continuing, most notably the airport side of the Merrimack River to future industrial
the 130,000 SF phase two of the Legends at Sparks Marina. development.
Despite market conditions, Wal-Mart is under construction
with one store and is in the process of acquiring another site. On the Bedford and Merrimack side, projects are in place to
develop additional retail due to the increased traffic. Further
Metropolitan Area Investment sales have been impacted by lower occupancies Metropolitan Area up the river in the downtown area, the Elliot at River’s Edge
Economic Overview and lower rents in all sectors. Most investors have increased Economic Overview will make its debut in 2010. A 200,000 SF medical facility
yield requirements between 9-11% to compensate for these will be unveiled on a site of an old, environmentally dirty in-
2009 risks. At the same time, the complete collapse of traditional 2009
Population 428,342 Population 400,362 dustrial building.
sources of debt resulted in a “perfect storm,” decreasing
values almost 45% since their peak in 2006. Manchester and her surrounding communities are well
473,903 Population 395,281 poised for 2010. Though the word of 2009 may have been
Population The decline in demand for commercial space in the local “apprehension,” the forecast for next year seems to be
Employment market caused by the global recession appears to have mod- Employment much more positive, based on the improvements to
Population 247,075 erated. Location, climate and lifestyle, attractive inducements Population 214,311 infrastructure and stability in population.
to the area that led to inflated values before the recession,
Household will be the engines that power the market back into normalcy Household
as the economy recovers.
Median Median

38 40
Reno At A Glance Manchester At A Glance

New Construction (AAA) $ 27.00 $ 27.00 $ 27.00 100.0% New Construction (AAA) NA NA NA NA
New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) NA NA NA NA
RETAIL RETAIL
Downtown $ 12.00 $ 30.00 $ 22.00 N/A Downtown $ 10.00 $ 20.00 $ 13.00 N/A

Office in CBD $ 20.00 $ 25.00 Office in CBD N/A N/A
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park $ 75,000.00 $ 100,000.00

Portsmouth, New Hampshire Atlantic County, New Jersey
The New Hampshire seacoast is the axis of the Golden Atlantic County’s economy is dominated by both the tourism
Triangle that runs from Portsmouth along the Massachusetts and casino gambling industries. Efforts are under way to
boarder up to Manchester and back to Portsmouth. diversify the county’s economy with the development of an
Seacoast was the ranked the #1 place to start a business in aviation research and technology park; however, the bulk
New Hampshire by Business Week. The area has a of real estate investment remains targeted at hotels, enter-
population of 433,244. The city of Portsmouth was named tainment, housing (to the casino industry) and recreation.
one of the top 10 places to live in the US by Money Maga- In 2009, casino gambling volume declined an average of
zine five out of the last 10 years. 14% for the county’s 11 casinos. The bright spot of the
The seacoast office market has experienced a change in region continues to be the Borgata Casino, which opened
vacancy. The Pease International Tradeport vacancy rate has in 2003. Borgata was the area’s first $1 billion-plus casino.
dropped from 18% to 12%. This is attributed to tenants This past year, gambling at Borgata was down a modest 5%.
relocating from the demolished Parade Mall and the expan- Entering 2008, there were several planned mega-casinos
sion of existing tenancies in the Tradeport. on the drawing board, however, due to the recession only
Statistically, New Hampshire entered Q4 2009 in a better Revel Entertainment broke ground and is currently under
position than the rest of New England. The recently reported construction.
Contact New Hampshire unemployment rate at 6.9% was three Contact Industrial real estate in the region continues to suffer from
points under the national rate of 9.7%. The loss rate in one a lack of deal velocity. Vacancy rates increased to approxi-
NAI Norwood Group NAI Mertz
of the largest sectors of the seacoast area is the hospitality mately 20% from 18% in 2008. Negative absorption was in
+1 603 431 3001 +1 856 234 9600
industry with 1,300 jobs lost and rising. The $610 million excess of 100,000 SF with a product base of approximately
Stimulus Package for 2009 awarded to New Hampshire will 5 million SF. The office market is relatively small for the
provide stability and an increase in jobs. Areas to be affected region, with just under 3 million SF. The office vacancy
include but are not limited to highway/bridge infrastructure, rate is approximately 13%, which represents an increase
weatherization/energy programs, learning institutions and of about 2% from 2008. Leasing activity remains modest,
drinking/waste water infrastructures. mostly renewal activity and again, locally driven and casino
Across the harbor from Portsmouth is the Portsmouth Naval related.
Shipyard. This facility has a payroll of $361.1 million, The retail sector is the most vibrant commercial real estate
Metropolitan Area accounts for $73 million in purchases in the New England Metropolitan Area sector, owing to the casinos and tourism/summer shore
area and contracts for $67 million in facility services. The activity. Retail vacancy is approximately 7%, representing
planned second phase of the PortWalk project in downtown an increase from 5.5% in 2008. The total retail market is
2009 Portsmouth has broken ground for 12,000 SF of retail and 2009 estimated to be in excess of 9 million SF.
Population 20,880 a 120-room extended-stay hotel. Two phases will follow, Population 268,530
Despite the recession and declining casino revenue, develop-
bringing roughly 160,000 SF of office, 40,000 SF of retail ers have not given up on the region. Casino Walks retail
Population 20,587
and 20,000 SF of restaurant space, as well as an under- Population 263,127 center began its third phase of development with completion
ground parking garage. scheduled for summer 2010. The Atlantic City community is
The New Hampshire seacoast, with its diverse economy and Population 191,412 hoping the future mega-casinos will transform their region
Population 12,298
unique resources, will not only endure the current economic to an over-night destination location similar to Las Vegas.
Household setback, but will continue to grow as a community and Household
Average Income $76,211 remain in the forefront of economic stabilization. Average Income $71,988
Median Median

39
Portsmouth At A Glance Atlantic County At A Glance

Bulk Warehouse N/A N/A N/A N/A Bulk Warehouse $ 2.25 $ 5.00 $ 3.50 20.0%
RETAIL RETAIL

Land in Industrial Parks N/A N/A Land in Industrial Parks $ 20,000.00 $ 100,000.00
Retail/Commercial Land N/A N/A Retail/Commercial Land $ 65,000.00 $ 400,000.00

Middlesex/Somerset Counties, New Jersey Northern New Jersey
Middlesex and Somerset Counties are located in the heart The market was stagnant in Q4 of 2008 into the first half of
of the central New Jersey commercial real estate market, 2009. Whether people focused on internal issues or waiting
located 40 minutes from downtown New York City and 60 for the next problem to arise, the end result was that they
minutes from Philadelphia. Direct access to Newark Liberty delayed making decisions. This began to change midway
International Airport, the Ports of Elizabeth and Newark, through the year. There is now more real activity and deal
access to a public mass transit system and an excellent road making taking place. Most of the transactions being
system attract companies wanting to take advantage of its completed are relatively short term and ones where the
geographical location and the abundant supply of a skilled landlords and sellers are very aggressive.
and educated labor force. In the office market, vacancy factors are only slightly up
Office sales and leasing activity is at a near standstill as over a year ago. However, asking rents have decreased and
buyers/tenants and sellers/landlords remain cautious. landlords are very aggressive in offering free rent and
Renewal activity is more prevalent as companies are opting extensive work letters. Subletting is also having a major
to stay in place rather than incur the costs of moving and impact on the market. The suburban markets have suffered
landlords are willing to make concessions to stabilize their more than the submarkets close to New York City.
assets. The office vacancy rate has increased to 20.7% as The vacancy factor in the industrial sector is approaching
more sublease space continues to come onto the market. a 10-year high. However, there have been transactions,
Contact Contact
The industrial market in central New Jersey remains highly especially in the second half of the year. Asking rates
NAI DiLeo-Bram & Co. NAI James E. Hanson
challenged. Central New Jersey’s strength is as a regional have decreased approximately 20% year to date and deals
+1 732 985 3000 +1 201 488 5800
distribution hub for larger big box industrial companies are being made off of those numbers. Landlords are
servicing the retail sector. The downturn in the economy has making shorter term deals more frequently than in the
negatively affected the supply provided by the optimistic past, and tenants have also been reluctant to make long
speculative construction that took place in the past 10 years. term commitments.
The submarket located at exit 8A on the NJ Turnpike has The retail sector has experienced the most difficult market
been especially hit hard as the vacancy rate has hit almost in the past 20 years. Vacancies in major corridors that would
20% and rents have dropped 30-35% to rates not seen in normally be leased right away are remaining vacant for
20 years. extended periods of time. The sector is suffering from a lack
Metropolitan Area The retail market in central New Jersey remains relatively Metropolitan Area of activity as opposed to the other sectors where there are
stable. A handful of national retailers have gone bankrupt deals to be made at a price.
Economic Overview and many retailers continue to struggle. The vacancy rate Economic Overview
Investment sales have been nearly nonexistent. There is
2009 has risen from 3% to 9% in the region. Rents have stabilized 2009
a growing gap in value between what owners feel their
Population 1,114,010 or dropped and new construction is non-existent. The Population 3,956,4481
properties are worth and what buyers are willing to pay.
biggest hurdle will be who will replace the big box retailers Additionally, there are fewer buyers in a position to purchase
that have exited. Population 3,760,849 properties, and many of them are pursuing debt purchases
Tenants will continue to take advantage of the current market versus physical real estate.
conditions as investors wait on the sidelines for opportunities The first half of 2010 should be a continuation of the second
to emerge on mortgages coming due for properties that half of 2009. Leasing activity should steadily improve as
Household were overleveraged at reduced capitalization rates. Once Household companies begin to feel more confident in the economy,
Average Income $103,225 the market stabilizes and space is absorbed the region will Average Income $103,225
with any area of concern remaining in the debt and capital
again be primed for growth. arenas.
Median Median

Median Age 38.6 Median Age 38.6
Middlesex/Somerset Counties At A Glance Northern New Jersey At A Glance

RETAIL RETAIL

Residential $ 25,000.00 $ 150,000.00 Residential $ 200,000.00 $ 1,000,000.00

Ocean/Monmouth Counties (“Shore Market”), New Jersey Princeton/Mercer County, New Jersey
The "Shore" region’s key employment sector growth was The Greater Princeton area joined the recession in 2009 with
driven by healthcare and senior services. New construction a pull back in financial companies such as Blackrock and
continues to falter, and tourism was better than expected, but Merrill Lynch. The pharmaceutical companies experienced
still weak by historical standards. The recent consolidation of growth after several years of languishing and readjusting
the Superbase (Lakehurst Naval, Maguire AFB and Fort Dix their models to become more streamlined. Overall, the retail
Army) has not offset the economic losses anticipated at Fort and industrial sectors have been negatively affected as
Monmouth. The Fort Monmouth exodus began slowly, but consumer demand retracted, causing a lack of demand and
is gaining momentum, driving up vacancies and landlord a lowering of rents.
anxiety. A drop-off in demand from service/legal business lowered
The fundamental problems in greater NJ (government overall demand by 10% in the first half of the year. Notable
spending, high taxes, high cost of living and weak employ- transactions were the Niksun $20/SF rental at Nassau Park
ment growth) have a particular impact on the shore market for 30,000 SF and Stealth Microwave for 20,000 SF in
because of its heavy reliance on tourism. Core real estate Ewing Technology. Johnson & Johnson leased a total of
demand drivers (job and housing growth) were weak in 125,000 SF at 23 Orchard Road. Otsuka Pharmaceuticals
2009 and are projected to remain soft well into 2010. recently leased 67,000 SF at One University Square in
Anemic job growth continues to plague the office sector, Princeton. Technology expansion in Princeton was up in the
Contact Contact first half of the year to 37% compared to 2008 figures.
although leasing activity picked up in the latter part of 2009
NAI Atlantic Coast Realty NAI Fennelly Medical sector growth came back from a slow 2008 with
as tenants scrambled to secure better lease terms. Buy-side
+1 732 736 1300 Associates, Inc. 11% growth so far this year compared to 4% last year. GDP
opportunities remain well below replacement cost so major
+1 609 520 0061 went into negative territory in Q3 2008, dropping further to
new construction is not anticipated in 2010.
negative 6% in Q1 2009 and now remains at negative 1%.
Re-trading historical rents was the 2009 story for industrial
assets as producers and warehousing struggled to contain Industrial rents have plummeted in the areas surrounding
costs. Industrial rents are flat to declining, but overall exits 8A and 7A of the New Jersey Turnpike, representing a
vacancy is increasing, pushing values downward. 30% reduction in rental values. Comparables in the area
include: Schwartz Paper at Exit 7A with 150,000 SF at
Retail landlords won't know the outcome of 2009 until after $3.25/SF starting rents and total rent averaging $4/SF over
the Christmas season, but if the "age of frugality" holds, 15 years; One Crossroads, a 20,000 SF single-story office
Metropolitan Area conventional wisdom is for increasing vacancies into Q1 Metropolitan Area warehouse in Hamilton, at $1.3 million or $68/SF. On the
Economic Overview 2010. All asset classes saw 100 to 150 basis point Economic Overview other side of Hamilton in an older industrial area, recent
increases in capitalization rates as underwriting (LTV, etc.) on foreclosure activity has taken place with a 60,000 SF, 14’
2009 2009
commercial assets has become overly conservative. clear building at 2425 East State Street recently selling for
The land market is stagnant but 2010 should provide strong $21.66/SF.
2014 Estimated buy-side opportunities on land inventory for long-term 2014 Estimated
As the commercial real estate market begins to rebound,
development as the economy struggles back. Owner-user this will create opportunities for companies to position
Employment buyers should be examining build-to-suit options now as Employment themselves in markets that were previously too expensive,
Population 537,330 land prices are historically cheap and construction activity is Population 180,232 such as the opening of the new 25,000 SF Home Furnishings
at an all-time low. store in Nassau Park. Companies, as well as investors, will
Household Household
Average Income $90,007 The long-term prognosis for the Shore Region remains Average Income $99,847 use this time to understand the strategic benefits and reap
strong. The Ocean-Monmouth region has the fastest growing the rewards that will be available in the market.
Median population and income in NJ. Population growth will likely Median
slow in the coming decade as land inventory becomes
Total Population terminal. However, this bodes well for future value spikes Total Population
Median Age 40.9 for those invested at the 2010 bottom. Median Age 37.7
Ocean/Monmouth Counties (“Shore Market”) At A Glance Princeton/Mercer County At A Glance

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Southern New Jersey Albuquerque, New Mexico
Southern New Jersey continues to be an advantageous While the Albuquerque market has not been immune to the
location for many businesses because it is contiguous to the national economic downturn, it appears to have held up fairly
Philadelphia area. It is also at the center of the Northeast well compared to others around the country. The current
Corridor with excellent road networks, rail capabilities and unemployment rate for the Albuquerque MSA is 7.4%, the
port facilities, making it ideal for almost any logistics and highest since 1996 but well below the national average.
supply chain requirement. Albuquerque Economic Development reports a record
The Southern New Jersey industrial market is faring better number of site location visits during 2009. Precise METRO
than the office or retail sectors. Industrial vacancy rates indicates that Albuquerque will emerge as a growth leader
trended up 1.5% from 2008. Rental rates have dropped during the recovery period and will outperform the national
approximately 10%. Sales prices have taken the brunt of economy during the next expansion.
the downturn running at 15-25% below their peak values. The Albuquerque retail market remains soft with a current
Deals of note completed in 2009 included Kimberly Clark’s vacancy rate of 14%. There was positive net absorption of
600,000 SF distribution center in the LogistiCenter and Goya 448,000 SF in Q3 2009 as the Wal-Mart Supercenter
Foods 250,000 SF build-to-suit in Gateway Business Park. opened its 196,000 SF facility. Asking lease rates for neigh-
Office leasing in 2009 was anchored by only a handful of borhood centers and strip centers are down as landlords
Contact medium-size deals including Coner Strong’s lease of 47,121 Contact struggle to keep their centers full.
NAI Mertz SF and the Parente Randolph lease of 29,609 SF. However, NAI The Vaughan The vacancy rate for Albuquerque office space continued its
+1 856 234 9600 more characteristic of the market was leasing activity Company upward trend to 16% with negative net absorption for the
dominated by short term renewals and sublet activity. Office +1 505 797 1100 year. With no new construction, asking lease rates for office
vacancy rates climbed to 12% range and are anticipated to space have remained stable. Two significant projects, the
peak in late 2010 in the 13.5% range. 200,000 SF Hewlett Packard call center in Rio Rancho and
In 2009, the average sales price was down approximately the 93,000 SF Carpenter’s Union along the I-25 Corridor in
19%. Construction starts were virtually non-existent in Albuquerque, are scheduled to be completed in late 2009 or
2009. Activity in the region was internally generated. Growth early 2010.
was seen by service and sales companies in the collection, The Albuquerque industrial market is the healthiest of the
courier/distribution, healthcare and consumer product specialty markets with a current vacancy rate of 8.8%.
Metropolitan Area industries. The vacancy rate in the retail sector increased to Metropolitan Area Asking industrial lease rates are down 15% from last year as
Economic Overview approximately 8% with rental rates dropping approximately Economic Overview tenants take advantage of the opportunity to shop for a lower
10% to attract retailers to small strip centers. lease rate in the market or renegotiate their current
2009 2009
Population 1,304,559 The requirements of New Jersey’s Council of Affordable locations. Employment in construction related industries needs
Population 864,696
Housing (COAH) have been temporarily suspended. COAH to improve before demand for industrial space increases.
2014 Estimated was intended to subsidize affordable housing development 2014 Estimated Leasing has increased in the second half of 2009 while
and cannot be passed on to tenants, complicating the sales continue to lag due to economic uncertainty by owner-
Employment return on investment calculus for developers at a time with Employment users and difficulty in obtaining financing by investors.
Population 634,709 significant challenges. Population 404,526 Albuquerque should continue to grow due to many factors
including its mild climate, quality of life and its productive
Household Household
$61,073
work force.
Average Income $81,769 Average Income
Median Median

Median Age 38.5 36
Median Age
Southern New Jersey At A Glance Albuquerque At A Glance

Class B (Secondary) N/A N/A N/A N/A Class B (Secondary) $ 12.00 $ 15.00 $ 13.50 N/A
RETAIL RETAIL

Office in CBD N/A N/A Office in CBD $ 650,000.00 $ 2,000,000.00

Las Cruces, New Mexico Albany, New York
New Mexico economists like to say, the Las Cruces economy Albany, the capital of New York, continues to outperform the
is insulated from, but not immune to, national economic rest of the state. Recently named the newest international
downturns. Events of 2009 have served to strikingly home for AMD and a $2 billion chip fabrication plant, the
illustrate this truth. While the US entered a recession in capital region is quickly earning its tech valley moniker. Nan-
December 2007, it wasn’t until March 2009, a full 14 otechnology research and numerous opportunities in higher
months later, before Las Cruces saw negative year-over- education are helping to attract and retain workers. The
year employment numbers. insular nature of the state’s government seat has continued
The office market has experienced rising vacancy rates to contribute to the stability of the area.
approaching 10% - a rate far below the national average, The CBD office market continues to struggle with a glut of
but in excess of the 8% five year historical annual average. Class B or lower inventory. Vacancy in that sector is 20%
Absorbing the 100,000 SF of new office space permitted in or higher. Functionally obsolete buildings that require sub-
2008, will provide building owners little latitude in rental rate stantial capital to renovate are abundant in the downtown
negotiations. marketplace. The suburban office parks are performing very
In the retail market, there is nothing like the loss of a job to well with vacancy rates of 10-12% overall.
dampen consumer sentiment, spending and demand for A large state-owned tract of land commonly known as
Contact space. Following 16 consecutive years of consistent growth, Contact the State Campus is being viewed as the next home for a
Total Gross Receipts, including the widely watched Retail mixed-use park. Slated to be unveiled in Q2 2010, the park
NAI 1st Valley NAI Platform
Trade component, registered a small, uncharacteristic will offer high-end office space, research space, retail and
+1 575 521 1535 +1 518 465 1400
decline in 2009 Q2 data. It is likely that unfavorable trend will a mix of residential units.
impact year end totals. Scant new retail sector construction The industrial marketplace has been an active arena. The
should help maintain the supply and demand equilibrium and few tenants that are moving have taken advantage of the
hold vacancy rates through the coming year within the current situation, forcing landlords to reluctantly make lower
10-12% range. priced deals rather than be burdened with a year-long
The Las Cruces multi-family market has exhibited sustained vacancy. Rates are in the 8-12% range overall with spaces
stability and strength. With a 2000-2009 period market of 25,000 to 50,000 SF.
average occupancy of 93.9% and average annual rental Retail activity has slowed considerably with only the smaller
Metropolitan Area increases of 2.4%, this has proven to be among the best Metropolitan Area franchisors and very large, established retailers making
performing commercial real estate sectors in Las Cruces. waves in the pool. Dick’s Sporting Goods expanded to more
Economic Overview Developers have apparently taken note as more permits Economic Overview
than 60,000 SF on two levels. Forever 21 will back fill the
2009 were drawn for multi-family units in the first two months of 2009
former 30,000 SF space.
Population 208,136 this year than in the previous two years combined. Population 857,461
Investment and multifamily offerings were down slightly as
2014 Estimated Las Cruces will see substantial "downtown" renewal with 2014 Estimated lenders continue to tighten their requirements. This practice
Population 229,497 the addition of Pro's Ranch Market and the renovation of Population 867,195
has driven capitalization rates up slightly to an average of
the Brazito Plaza. Also, national retailers are looking to get 8-9% overall.
63,528
ahead of the boomer wave moving to New Mexico when 542,766
Population Population Look for brighter skies and more activity as the year unfolds.
they are able to sell their homes elsewhere in the country.
Household Household As a strong tertiary marketplace, the capital region has
Average Income $49,165 Average Income $70,935 remained a stable and safe environment to live, work and
invest.
Median Median

31 39
Las Cruces At A Glance Albany At A Glance

New Construction (AAA) N/A N/A N/A N/A New Construction (AAA) $ 22.00 $ 26.00 $ 24.00 N/A
RETAIL RETAIL
Neighborhood Service Centers N/A N/A N/A N/A Neighborhood Service Centers $ 12.00 $ 16.00 $ 14.50 N/A
Community Power Center N/A N/A N/A N/A Community Power Center $ 12.00 $ 18.00 $ 15.00 N/A
Regional Malls N/A N/A N/A N/A Regional Malls $ 18.00 $ 35.00 $ 26.50 N/A

Office in CBD $ 250,000.00 $ 400,000.00 Office in CBD $ 150,000.00 $ 750,000.00

New York City, New York Long Island, New York
The Manhattan office market was relatively stable at the end As with most of the country, Long Island is feeling the effects
of 2009. The 11.9% vacancy reached in Q3 2009 was the of the recession. History has shown the local economy to
highest Manhattan has seen in four years, but is still among be stable compared to the rest of the nation, in good times
the lowest in the country. Rents continued to decline in 2009 and bad, as evidenced by the current unemployment rate
with average asking rents falling to $52.05/SF, down from of 7.4%, well below the national average. However, all
almost $70.00/SF in late 2008. However, the rate of decline segments of the real estate market are soft and it is
has stabilized. Sublease space, which had increased each expected to worsen before it improves.
quarter for over a year, has also stabilized. Most of the recent The office market has weakened considerably throughout
leasing activity has been led by those companies waiting for 2009. Overall vacancy rates for Class A and B space have
rents to hit bottom and finally deciding to make a move to increased to 11.1%. However, the total availability rate,
upgrade their existing space at rock bottom prices. which accounts for occupied sublet space, has increased
Midtown Manhattan enjoys a great diversity of tenants, and to 17.5%. Landlords are offering substantial rent reductions
there are several large tenants seeking space in the and concessions to attract and retain tenants.
200,000+ SF range. Tenants with good credit will continue The investment market has changed rapidly in 2009. The
to have the upper hand with landlords offering increased lack of credit has caused investment sales to come to a
concessions. The Midtown South submarket provides sec- virtual standstill with few deals being completed. Many prop-
Contact ondary office buildings for tenants seeking less expensive Contact
erties purchased at top prices in recent years are struggling
NAI Global New York City alternatives. Downtown Manhattan is bracing for an increase NAI Long Island
to meet debt service. Attention has turned to lenders who
+1 212 405 2500 in available space; however, city government is expanding +1 631 270 3000
are holding numerous loans in early stages of default.
incentives for services companies locating to the area.
The industrial sector is also very soft. Vacancy rates have
Manhattan market fundamentals remain weak with current risen to 9% but numerous owner occupants have been
unemployment at 10.3%, the highest in New York City in 16 struggling to sell properties too large for their businesses
years. The financial industry continues to reduce its labor as sales prices have fallen 20-30% in most submarkets.
force, job growth and corporate revenues remain stagnant
and the credit market remains tight. With the fundamentals The retail market has been impacted substantially by the
showing continued weakness, a turnaround in the commercial recession. Many auto dealerships have lost their licenses,
market is not expected until mid to late 2010. putting quality properties on the market. That increased
Metropolitan Area Metropolitan Area inventory has led to a significant reduction of prices for
Investment sales in Manhattan have been few; however potential development sites. Home Depot Expo and Circuit
Economic Overview distressed assets are starting to appear in greater number Economic Overview
City have left the market, leaving several big box vacancies.
2008 and it is expected that foreign investors and well capitalized 2009
Most of these spaces have not been filled but they are
Population 18,962,019 investment groups will seek to take advantage of a new Population 1,267,4441
being considered by retailers looking to take advantage of
pricing structure, spurring the expected turnaround. The the opportunities.
2013 Estimated 2014 Estimated 1,173,752
stabilization of sublet space is another indication that the Population
Population 19,340,176 Unlike the recession of the early 1990s, Long Island is not
market may soon turn around as it indicates firms are holding
Employment onto space for anticipated staffing needs, rather than putting Employment 630,791
overbuilt. Because of this, prevailing sentiment is that the
Population 9,120,649 it on the market at a loss and then having to lease additional Population recovery from this downturn may be faster than the recovery
space at a premium once the market has recovered. in the mid 90s.
Household Household $119,517
Average Income $89,679 There are many positive signs, including a strong workforce, Average Income
New York City’s global leadership and its diverse industries
Median Median $91,445
such as: Professional Services, Bioscience, Emerging Tech- Household Income
nology, Green Industry, Media & Entertainment, Not For
Total Population Profit, Fashion and Tourism. Total Population 42.1
New York City At A Glance Long Island At A Glance

MIDTOWN OFFICE DOWNTOWN OFFICE
DOWNTOWN OFFICE SUBURBAN OFFICE
New Construction (AAA) $ 65.00 $ 75.00 $ 70.00 N/A New Construction (AAA) $ 30.00 $ 36.00 N/A 11.0%
Bulk Warehouse N/A N/A N/A N/A Bulk Warehouse $ 4.50 $ 7.00 N/A 9.0%
Manufacturing N/A N/A N/A N/A Manufacturing N/A N/A N/A 9.0%
RETAIL (Midtown) RETAIL
Central Business District $ 60.00 $1,400.00 $ 300.00 3.5% Downtown N/A N/A N/A N/A
Neighborhood Service Centers N/A N/A N/A N/A Neighborhood Service Centers $ 18.00 $ 30.00 N/A N/A
Community Power Center N/A N/A N/A N/A Community Power Center $ 20.00 $ 40.00 N/A N/A
Regional Malls N/A N/A N/A N/A Regional Malls $ 60.00 $ 120.00 N/A N/A

Land in Office Parks N/A N/A Land in Office Parks $ 500,000.00 $ 1,000,000.00
Land in Industrial Parks N/A N/A Land in Industrial Parks $ 300,000.00 $ 600,000.00
Office/Industrial Land - Non-park N/A N/A Office/Industrial Land - Non-park $ 500,000.00 $ 1,000,000.00

Asheville, North Carolina Charlotte, North Carolina
Asheville is in a great position to do business, sitting at the Over the last two years, various sources have ranked the
crossroads of two major interstates; I-40 which links the Queen City area as the number one place in America in the
east and west coast of the US, and I-26 which helps connect following categories: Best Place to Live, Most Educated
Charleston, South Carolina, to the Ohio River Valley. A Workforce, Top Large Counties for Recruitment & Attraction,
growing mix of healthcare, professional/technical services, America’s Most Livable Communities and Economic Strength
knowledge-based enterprises and tourism fuels the local Ranking. Eight Fortune 500 companies are headquartered
economy. here and 326 Fortune 500 companies have facilities here. A
Industrial vacancy rates were virtually unchanged from vast majority of the region’s employment is directly linked to
2008. New construction in the industrial sector will likely be financial, manufacturing, energy and racing related firms.
limited to build-to-suit projects in the new year. The strategic location, coupled with the low cost of living,
keep people moving to the market.
Supply-side pressures in the office market are expected to
continue into 2010 with over 90,000 SF of new space under The overall vacancy in the Office market is 15.9%, an
construction and over 195,000 SF of office space proposed. increase of 23% over the past year. The vacancy rate in the
Completions during 2009 surpassed the totals reported in Central Business District is 7.6%, up from 2.1% in 2008.
each of the past three years, and supply side pressure on With 2.5 million square feet of new space coming on line,
vacancy will continue to increase as the remaining new space the CBD vacancy rate is expected to climb to 12-13%. The
Contact Contact good news is Charlotte now has sufficient space available to
is delivered.
NAI BH Commercial NAI Southern Real Estate compete for major corporate relocations.
+1 828 210 3940 Approximately 10.5% of the market’s retail inventory was +1 704 375 1000
reported vacant. Several mix-used projects were underway, The Industrial market has been fortunate not to suffer from
1 866 810 5893
including Reynolds Mountain and Biltmore Park among oth- over supply. Only two speculative buildings are in the
ers. Barnes and Noble, with their second location in the construction phase in the entire market. The current vacancy
Asheville market, occupied 28,000 SF of new space at Bilt- rate is 13.5% which holds its own compared to 12.6%
more Park Town Square, one of the largest tenant moves a year ago. Although demand today is weaker than the
during the year. pre-recession period, brokers report an increased demand
in the 20,000 to 50,000 square foot range.
The area unemployment rate was the highest rate reported
since 1991; however, it continues to be lower than the state Retail vacancies are rising, and landlords are offering
Metropolitan Area and national average. In addition, the annual job growth rate Metropolitan Area generous concessions to attract tenants to their centers.
consistently tops the state and nation. Currently, Retail vacancy is at 8.9%, up substantially from
5.7% over the past year. However, it is expected that the
2009 One of the key advantages to building your business in 2009 vacancy rate will continue to rise into mid-2010. Very little
Population 416,498 Asheville is its suitability both as a place to live and a vital Population 1,782,827 development is expected until rates level off.
place to grow your business. Asheville has been ranked by
2014 Estimated several prominent publications. Asheville was ranked num- 2014 Estimated Other than a few apartment properties changing hands, the
Population 446,922
ber six as “Best Metro Places for Business and Careers” by Population 2,108,238 Investment Market has been extremely slow. This may be
Forbes Magazine (March 2009), ranked number two as beginning to change as a 1.1 million square foot Industrial
219,126 “One of the Nations Top Arts Destinations” by American Style Population 856,303 portfolio at Crosspoint Park sold for $34.2 million. There
Population
Magazine, ranked number eight of Top 10 Metro Areas for were multiple bidders for the property that sold at roughly a
Household Quality of Life by Business Facilities Magazine in July 2009 Household 9.5% CAP rate.
and included as a Favorite City of Business Trips in USA Yes, the recession is hitting Charlotte, but we feel the area
Median Today Road Warriors in August 2009. Median is in a great position to come out of the downturn stronger
Household Income $45,198 Household Income $62,093 than ever.
42 36
Asheville At A Glance Charlotte At A Glance

RETAIL RETAIL

Office in CBD $ 300,000.00 $ 800,000.00 Office in CBD $ 650,000.00 $ 1,200,000.00

Greensboro/High Point/WinstonSalem, North Carolina Raleigh/Durham, North Carolina
Infrastructure improvements bode well for the future of the In May 2009, MSNBC named Raleigh-Durham number two
region. Expansion of a third runway and major road improve- in the nation for the top five markets likely to recover
ments have resulted in a $300 million FedEx Mid-Atlantic quickly. This analysis was based on good job growth, grow-
hub opening at the airport and the location of a 400,000 SF ing population, good weather, lots of first-time home buyers,
FedEx Ground sorting facility in Kernersville. HondaJet has little overbuilding, vital downtowns where people can live
opened a headquarters facility at the airport and will deliver without a car, a well educated population, and a large number
the first of its six-passenger light jets in 2011. of foreclosures that happened early. Fortunately, the region
The industrial market suffered its share of setbacks in 2009, is also home to the Research Triangle Park, one of the most
with an unemployment rate over 11% and the closing of the successful R&D centers in the world, featuring microelec-
flagship 790,000 SF Dell manufacturing plant in Union tronics, environmental sciences, pharmaceuticals, and
Cross. Industrial vacancies for modern distribution centers biotechnology companies.
over 200,000 SF exceed 6 million SF, an estimated 10-year The Triangle area continued to attract new businesses as
supply at historic absorption levels. The only bright spot is well as domestic and international expansions despite the
increased demand for warehouse space between 20,000 downturn in the economy. The Triangle Combined MSA
and 40,000 SF with rents leveling out in the $3.00- added an average of 10,254 jobs per year (July to June)
$3.50/SF range for good quality space at the airport. over the 7-year period ending in June 2009 resulting in an
Contact Contact average 1.5% annual growth rate. Companies like EMC
The retail sector has continued to deteriorate with small
NAI Piedmont Triad NAI Carolantic Realty, Inc. Corporation announced plans for a $280 million expansion
shop vacancies reaching 25% and tenants going out of
+1 336 373 0995 +1 919 832 0594 that will add almost 400 jobs over the next five years.
business faster than the landlords can lease the space.
Restaurants and boutique shopping have been particularly Deutsche Bank will open a technology development center
hard hit as consumers continue to cut back on spending. creating over 300 jobs and investing $6.7 million.
Food anchored neighborhood centers are faring better than However, even with the growth, concerns about the national
other product types, with rents for small shops declining by economy were reflected in the local office market which
only 20%. The forecast for 2010 is more of the same, with pointed to a rise in vacancy as tenants downsized and new
little hope of substantial improvement until 2012. sublease space brought additional pressures. Vacancy rose
The office market has followed other market segments, with two percentage points higher from 2008 to 15% with
cutbacks caused by Wachovia’s demise freeing up large minimal net demand. Approximately 1.4 million square
Metropolitan Area Metropolitan Area feet were added to the market during 2009 and rental
blocks of space in downtown Winston-Salem. Vacancy is
Economic Overview over 20% in all markets. There are sporadic signs of activity Economic Overview rates dropped slightly with concessions offered on extended
2008 with a financial services arm of LabCorp bringing 383 jobs 2009
leases. Less than 500,000 square feet were under
Population 722,220 to Greensboro by Q2 2010. Population 1,150,305 construction for 2010.
Public sector investment has been strong, with UNC-G and Somewhat surprising, the multipurpose sector experienced
Population 781,425 NC A&T universities breaking ground on a $60 million center Population 1,404,352 a slight drop in vacancy from 16% in 2008 to 15% in 2009
for Nanotechnology in east Greensboro. Guilford Technical with 3% absorption. Uncertainties in the overall economy
Employment
Community College is also under way with a $150 million Employment and financial markets will test this sector into 2010. Rental
Population 407,900 Population 540,316 rates declined and approximately 300,000 square feet were
Airport Campus that will specialize in the aviation and logistics
Household industries. Household
under construction for 2010.
Average Income $59,036 Average Income $75,927 Over 1.4 million square feet of retail space was completed
in the Raleigh-Durham market in 2009 with an additional
Median Median
900,000 square feet now under construction. Vacancy rose
from 4% in 2008 to 6% in 2009 and absorption remained
Total Population Total Population at 3%. Rental rates declined slightly. As construction
39 36
Median Age Median Age continues on the Outer Loop (I-540) around Raleigh, new
retail opportunities will be opened at major interchanges.
Greensboro, High Point, WinstonSalem At A Glance Raleigh/Durham At A Glance

RETAIL RETAIL


Fargo, North Dakota Akron, Ohio
The 2009 Fargo market can best be described as sporadic Situated near Lake Erie and several major interstates in the
and uneven. Demand for office and retail space is contracting heart of the Midwest, Akron continues to attract entrepre-
while demand for industrial space is fairly stable. The multi- neurs, investors and new businesses through its reputation
family sector remains active but with off-market properties. for innovation, low cost of living and strong institutional
Current inventory of multi-family properties is very low. investment in the community. Akron’s greatest growth
Excessive surplus office and retail inventories exist. in 2009 was in health care, education, technology and serv-
Industrial inventory has a slight surplus. Key Fargo industry ice industries. Manufacturing and distribution continue to
drivers include health care, education, banking, insurance, contract from last year and retail has slowed with consumer
agribusiness, shipping - transportation, and manufacturing. spending.
The office rental market is soft. An overabundance of lease Greater Akron saw an increase in institutional development
space with landlord concessions and competitive rental projects throughout 2009. The construction of the $61.6
rates prevails. Currently, there are approximately 219 lease million Infocision stadium at the University of Akron was
listings on the market. Rental rates vary from $7.00/SF to completed this year and welcomed a capacity crowd on
$8.00/SF for Class B space and up to $9.50/SF to opening day. The requirement for educational office space
$11.25/SF for Class A space located in start-up business has increased as the unemployed seek job and career
parks or along key corridor sites. The surplus of office space training from ITT Technical Institute, Brown Mackie College,
Contact is expected to carry through 2010. Closed office sales Contact Strayer University and the like. These companies seek Class
NAI North Central are off from last year's pace and are expected to finish NAI Cummins A and B office space in markets across the country and have
+1 701 364 0244 behind 2008. Real Estate opened multiple locations throughout Northeast Ohio to
+1 330 535 2661 accommodate growth in enrollment.
The industrial rental market is near equilibrium with a
nominal inventory surplus. Rental rates for Class B heated The requirement for medical office space continues to
space range from $4.50/SF to $6.00/SF. Year to date closed expand as groundbreaking takes place on hospital and
industrial sales are slightly behind 2008. The retail rental medical center projects throughout Summit County. Summa
market is saturated with 142 lease listings on the market. Hospitals began construction on the Crystal Clinic and
New retail projects including Amber Valley, Cityscapes Plaza, acquiring Robinson Memorial Hospital in Ravenna. Akron
Eagle Run, Osgood, and Shoppes at Urban Plains, have General expanded the reach of its emergency medical
added to the surplus. The surplus will carry through 2010. services and wellness centers with new facilities and a 30+
Metropolitan Area Rental rates for Class A space are $14.00/SF to $16.00/SF. Metropolitan Area bed hospital planned for a suburban community.
Economic Overview Class B space runs $9.00/SF to $10.75/SF. However, closed Economic Overview Investors have seen rising capitalization rates for cash-ready
2009
retail sales should finish comparable to 2008. Major 2009 buyers and sale/leaseback opportunities abound. Seller
Population 202,025 I-94 interchange projects are in progress in south Moorhead Population 694,360 financing is now a viable option for many buyers and sellers
and south West Fargo creating renewed interest in and who are highly motivated to close transactions. Manufacturing
2014 Estimated development at those sites. North Dakota State University 2014 Estimated
has taken a hit with the drastic reduction in automotive
Population 225,041 opened a satellite business college & architecture department Population 680,988
assembly. With an ample supply of light industrial space
Employment
in the CBD. Employment available, tenant lease terms are shorter. Sale prices
Population 142,133 Special mention is made of the historic 2009 Red River Population 393,378 and attractive lease rates offer great opportunities for buyers
Household
Flood. Local and regional businesses lost at least one full and tenants.
Household
Average Income $57,820 month of sales and production as a direct result of the flood. Average Income $64,509 Retail development expanded to suburban communities.
Economic impact was felt across all sectors as employers These growing areas have lured regional and national
Median contributed valuable labor and inventory to this effort. Median
tenants, speaking to the demand for mid to upscale services.
Declining malls, strip centers and plazas are being
Total Population Total Population reinvented to include mixed use, light industrial, records
32 39
Median Age Median Age storage, trade schools and call center space.
Fargo At A Glance Akron At A Glance

RETAIL RETAIL
Downtown $ 14.00 $ 16.00 $ 15.00 14.3% Downtown $7.00 $ 17.00 $ 12.00 8.0%
Neighborhood Service Centers $ 10.00 $ 12.50 $ 11.50 8.5% Neighborhood Service Centers $6.00 $ 30.00 $ 13.50 14.0%
Sub Regional Centers $ 8.00 $ 9.50 $ 9.00 8.5% Community Power Center $10.00 $ 17.00 $ 14.00 14.0%
Regional Malls $ 18.00 $ 20.00 $ 19.50 3.0% Regional Malls $20.00 $ 30.00 $ 25.00 4.0%


Canton, Ohio Cincinnati, Ohio
Stark County, including the greater Canton area, is strategi- The Cincinnati, Ohio regional market has recently been
cally located in Northeastern Ohio at the crossroads of the recognized for its inclusion on the top 25 list of total personal
Eastern and Midwestern markets. Its network of interstate income (TPI), (U.S. Bureau of Economic Analysis), for two
highways and one of the fastest growing airports in the of the top 10 hospitals in the nation (Modern Healthcare), and
country, allows companies easy access to several major three of the nation’s top 500 fastest growing businesses (Inc.).
cities. This, coupled with a low cost of living, primarily the Cincinnati has two major areas of growth in an otherwise
result of very reasonable housing prices, makes Stark challenging year. The Banks project in the CBD is a
County a great place for companies and families to locate. 2.8 million SF mixed-use development on the Cincinnati
A bright spot in the Stark County market has been the riverfront located between Paul Brown Stadium and the
growth around the airport. The Akron-Canton Airport (CAK) Great American Ballpark. The second major growth area is
offers the lowest average fare of any airport in Ohio. Indus- the Cincinnati/Dayton Metroplex, specifically the West
trial, office, retail, and hospitality have all developed along Chester-Middletown submarket. Located between Dayton
with the airport. Located in close proximity to the airport, and Cincinnati, this market is activity-driven. The area is
Rolls Royce just announced a multimillion dollar expansion home to three new hospitals: Westchester Medical Center,
of their Fuel Cell Prototyping Center at Stark State College. Children’s Medical Center Liberty Campus, and Atrium
Other areas throughout the county also remain upbeat. On Medical Center; GE Aviation, a 403,000 SF campus in West
Contact Contact Chester; and the Cincinnati Premium Outlets in Monroe, an
the industrial front, Shear's Potato Chip broke ground on
NAI Spring NAI Bergman upscale, 100-store retail mall.
Ohio's fist Gold LEED-Certified Food Manufacturing Plant in
+1 330 966 8800 +1 513 769 1710
NEOCOM Industrial Park in Massillon. Another major project While transactions are conservative and the process
is the new Federal Building in Downtown Canton. This extended, the commercial real estate market continues to be
$14 million dollar facility is expected to be completed in stable. The office market has produced positive absorption.
July 2010. Vacancy and rental rates remain consistent within historic
The office market remained relatively flat with several margins, and certainly better than has been witnessed in
tenants consolidating space. The Schroyer Group, for example, other U.S. office markets in general. At rates approaching
is consolidating their operations and planning to move into 8% for warehouse and flex at 10%, Cincinnati industrial
its new state of the art 57,000 SF office in the former Hoover warehouse vacancy is also faring better than the U.S. norm.
Building. The industrial market continues to struggle with Though fewer transactions overall, sales prices have
Metropolitan Area Metropolitan Area remained steady and rental rates have dropped less than
quite a few large, older manufacturing buildings on the
Economic Overview Economic Overview 20%. Retail rental rates have increased as the retail
market for sale or lease. However, distribution space of
2009 10,000 to 50,000 SF is somewhat limited around the I-77 2009 inventory is being absorbed. Scheduled projects for Q4
Population 401,820 corridor. Downtown Canton remains a hot spot for retail with Population 2,187,233 2010 completion include The Banks Phase I (70,000 SF)
several new restaurants, a bustling arts district and other and Corryville Crossings (100,000 SF).
Population 388,122 shops opening during 2009. Population 2,317,532 Cincinnati’s business-friendly environment, affordable housing,
Traditionally, the Canton area doesn't experience the well-educated workforce, stability, diverse economy, and
Employment
extreme highs or lows found in other markets. This held true
Employment easy access to national and regional markets create a solid
212,030 Population 1,114,241
Population
as the overall region remained relatively stable compared to environment for new business and continued growth.
Household other markets around the country. Household
Median Median

37
Canton At A Glance Cincinnati At A Glance

RETAIL RETAIL

Office in CBD $ 75,000.00 $ 150,000.00 Office in CBD $ 300,000.00 $ 3,000,000.00

Cleveland, Ohio Columbus, Ohio
Battered by continued economic woes, particularly in the Columbus continues to lead the state in job growth, popu-
banking and automotive sectors, the Cleveland market was lation growth and new development, due in large part to
characterized in 2009 by sluggish leasing velocity, slowly being the state seat of government, and home to the Ohio
rising vacancy rates and a dramatic absence of property State University, Battelle Memorial Research Institute, health
sales. The CBD office sector was the most stable market industry leader Cardinal Health, Nationwide Insurance and
segment. Seeking to take advantage of a tenants’ market, the Limited Brand family of stores. Major hospital systems
several major companies made new lease commitments, Ohio Health, University Hospitals and Mount Carmel Health
solidifying the downtown market for the next several years. Systems continue to compete for market share with new
Additionally, downtown Cleveland is positioned to capture office development and the addition of hospital beds.
momentum from several large public-sector projects either Demand for all office product stagnated in 2009 with a loss
planned or under way, including a new convention center of occupied square footage of about 1% of the total. Vacancy
and medical mart, a mixed-use redevelopment of the East increased in all office markets except for suburban Class A,
Bank of the Flats and possibly a new hotel/casino. The which decreased by 0.5%. Rental rates fell in all office
suburban office market was a more difficult environment, markets as a result of landlords aggressively chasing tenant
hampered by widespread financial hardship among tenants. renewals. Many office leases had rates reduced and
A couple of bright spots include the announcement by Eaton terms extended, as tenants took advantage of landlords
Contact Corporation to develop a new world headquarter campus Contact hoping to stabilize assets that would need refinancing in the
NAI Daus at Chagrin Highlands in the Eastern suburbs and the NAI Ohio Equities, LLC next few years.
+1 216 831 3310 continued development of substantial medical facilities by +1 614 224 2400
All segments of the warehouse market continue to stagnate,
the Cleveland Clinic in Twinsburg and University Hospitals with vacancy increasing about 1% in bulk and manufacturing
at Chagrin Highlands. space. Interest from national retailers for new development
It was also a challenging environment in both the industrial has slowed substantially. Fast food is the only segment of
and retail markets. The overall industrial vacancy rate the retail market with new store growth. Retail rates have
increased 100 basis points during the year and absorption fallen across the board, and by as much as 25% or more for
was negative each quarter. Although there was moderate the most expensive space.
leasing activity, it was dominated by tenants seeking lower Residential development of all kinds is virtually non-existent,
rents, less space and shorter terms. The retail market with the exception of a few market apartment buildings
Metropolitan Area shared many of the same characteristics, particularly among Metropolitan Area
being developed. Single family developers continue to pick
Economic Overview tenant activities. However, unlike the industrial market, which Economic Overview up undeveloped blanks from lenders and competitors who
2009
had virtually no new construction, the retail market did have 2009 hope to resume building once the existing inventory starts
Population 2,056,588 a few projects in the pipeline. These included the Plaza at Population 1,811,662 to be absorbed. Capitalization rates for all investment product
Southpark in Strongsville (300,000 SF) and City Center of seems to have stabilized. Properties that had been trading
2014 Estimated Avon (100,000 SF). 2014 Estimated
at 7% capitalization now hover around 9%.
Population 1,958,428 Population 1,948,423
The improvement of broader economic indicators should The central Ohio economy continues to chug along with the
Employment bode well for the region in 2010. However, direct impact in Employment
bulk of activity being generated by local operators not pulled
Population 1,260,439 the real estate segment likely won't be noticeable until the Population 1,064,756
down by economies outside our region.
second half of the year and a dramatic improvement will not Household
Household
Average Income $63,694 happen until the capital markets return to a more normal Average Income $67,218
environment.
Median Median

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
High Tech/R&D NA NA NA NA High Tech/R&D N/A N/A N/A N/A
RETAIL RETAIL
Downtown NA NA NA NA Downtown N/A N/A N/A N/A

Residential $ 10,000.00 $ 120,000.00 Residential $6,000.00 $ 10,000.00

Dayton, Ohio Oklahoma City, Oklahoma
With commercial real estate conditions expected to weaken
Oklahoma City will end 2009 at just above 6% unemployment,
into 2010, many commercial banks that provided loans during
one of the lowest in the country. The strong oil and gas
the commercial real estate buying spree now face capital short-
industry, low vacancy and low cost of living have helped the
falls and will be forced to stop extending loan due dates and
city weather the storm. Oklahoma City is home to Devon
begin cleansing their balance sheets of troubled assets. The
Energy, which just broke ground on a 750,000 SF, 53-story
opportunities to buy at steep discounts during this time period
office building to be completed in 2012 in the CBD.
will be ample for investors with cash-plentiful balance sheets.
The retail market is the weakest with overall vacancy of
The Dayton office sector ended Q3 2009 with a vacancy rate
12%. Class A rates are $21/SF, Class B rates $12/SF and
of 11.7% and negative absorption of 4,295 SF. Rental rates
Class C rates are $8/SF NNN. No new construction was
ended Q3 at $14.64 SF, continuing a downward trend. A
delivered in 2009. The industrial market is one of the
total of 51,780 SF were delivered in Q3 with 78,866 SF under
strongest markets, with vacancy at 9.6% up from 8.2% a
construction. The strongest submarket remains the south
year ago. Bulk warehouse rates average $3.75/SF NNN.
market with access to I-75 & I-675. There is almost no
There is very little available over 24' clear.
speculative development under way in the market; almost
everything currently under construction is build to suit or fully The Oklahoma City office market remains strong with overall
pre-leased. vacancy at 10%, up from 8.9% a year ago. Rents are very
Contact Contact stable with Class A at $22/SF, Class B at $14/SF and Class
Notable office deals in 2009 included DRS Technologies’ lease
C at $10/SF, all quoted as full service. No new construction
NAI Dayton of 47,000 SF in Mission Point in the Northeast submarket and NAI Sullivan Group
is planned except for Devon Energy’s 750,000 SF corporate
+1 937 294 7777 Ohio Institute of Photography & Technology’s lease of 54,072 +1 405 840 0600
headquarters in the CBD to be completed 2012.
SF in the Dayton Walther Building in the South submarket.
The multifamily market continues to be very strong with
The Dayton industrial sector ended Q3 2009 with a vacancy
overall vacancy at 9.5%, which is up from 7.0% a year
rate of 9.6% and negative absorption of 679,202 SF. Rental
earlier. Rental rates for Class A properties average
rates ended Q3 at $3.68 SF, up slightly despite the rising
$.95/SF/month, Class B at $.75/SF/month, and Class C at
vacancy factor. The strongest submarkets remain the I-75
$.49-$.58/SF/month. There is a great deal of construction
corridor to the south and the I-70 corridor to the east.
in the multifamily market with over 2,000 units currently
Notable industrial deals in 2009 included Soin International’s under construction. We expect the market to be very stable
lease of 115,000 SF in the Central submarket, and Phygen’s and improve as single family construction is at a standstill.
lease of 34,000 SF in the Northeast.
Economic Overview Economic Overview Oklahoma City is the third best city in the country according
The Dayton retail sector ended Q3 2009 with a vacancy rate a Forbes Magazine October 2009 report, based on
2009 of 9.4%, and absorption was negative 20,950 SF. Rental rates 2009 low unemployment, increasing home values and strong
ended Q3 at $9.25 SF, declining in step with the rising government leadership.
2014 Estimated vacancy rate. The stronger submarkets remain the south and 2014 Estimated
Population 807,016 northeast markets. Population 1,321,614
Employment Wright Patterson Air Force Base continues to be the region’s Employment
Population 459,851 economic engine, with a dozen new construction projects in Population 658,188
the pipeline valued over $300 million. The 1,000,000 SF of
Household facility space under construction over the next three years Household
will bring an additional 1,200 new jobs to the market.
Median Median

39 35
Dayton At A Glance Oklahoma City At A Glance

Premium (AAA) $ 17.25 $ 18.25 $ 17.55 15.4% New Construction (AAA) $ 21.00 $ 23.00 N/A N/A
RETAIL RETAIL


Tulsa, Oklahoma Portland, Oregon
The Tulsa market, with extensive oil and energy base Portland was named the #1 “Greenest City in America” by
employment, remained cautiously stable during the first Popular Science last year, and sustainable industries like
three quarters of 2009 while now experiencing real impact solar and wind power and green buildings are a significant
and slowdown from the national economic downturn that is and growing presence in the area’s economy. Software and
affecting other markets. However, the increase in commercial activewear companies (Columbia Sportswear and Nike
vacancies for Tulsa is still among the lowest of the country’s are headquartered in Portland) are also important sectors.
largest metro areas. Portland’s employment climate was challenging in 2009,
The office market is holding tight to its 2008 vacancy levels but the city’s green reputation, cultural offerings and outdoor
as demand and relocations have tapered off. The vacancy offerings continue to attract new businesses and residents.
rate for the CBD, at 23.7%, remains the highest in the Office vacancy increased considerably during 2009, but
market. The suburban market continues to remain the Class A space in the CBD remained tight, around 6%. No
strongest sector with majority of higher class buildings new CBD projects will deliver until summer 2010. Shoren-
averaging $14-$18.35/SF. The office market has main- stein’s First & Main and Park Avenue West were put on hold
tained a 76.4% occupancy rate overall with approximately due to a lack of financing. Vacancy in the suburban markets
21,183,758 SF in 148 buildings. The overall vacancy for a rose to around 20%, as Kruse Way and other submarkets
15,912,250 SF retail market has slightly increased about where many financial firms were located suffered higher
Contact 1% to 15.09%, the highest in a decade. Rental rates have Contact vacancy rates.
NAI Commercial actually risen since 2008 with $19.64/SF for Class A and NAI Norris, Beggs
The industrial market softened, with vacancy rising to 15%.
Properties $10.47/SF for Class B properties. However, retail feeling & Simpson
Though construction was down, work continued on FedEx
+1 918 745 1133 the effects of thinning national tenants and larger big +1 503 223 7181
Ground’s facility in Tigard, which should deliver in summer
boxes vacated, will see increased vacancies, reduced rent 2010 and employ about 650. One ofthe largest transactions
pressures and stiffer competition for the remainder of 2009. of the year was SEH America’s $55 million purchase of
In comparison, the industrial market has fared better than Hewlett-Packard’s Vancouver, Washington, campus.
other sectors despite a 3.5% vacancy increase from 2008, Retail vacancy rose to around 8%, and the Portland market
or approximately 8% total, on an inventory of 60,000,000 saw some big-box spaces coming back on the market. The
SF. Lease rates have softened for new leases and renewals, bankruptcy/liquidation of Joe’s Sports, which had 14 Oregon
with current averages of $4.07/SF for bulk warehouse and stores, left considerable vacant space, but Dick’s Sporting
Metropolitan Area $6.65/SF for service center spaces. Investment/land sales Metropolitan Area
Goods leased six metro locations of around 50,000 SF each.
Economic Overview for multi-family, hospitality and retail have virtually stopped Economic Overview
from late 2008 with the notable exception of a $38 million Multifamily vacancy hovered around 5%; fewer tenants were
2009 2009
Hilton hotel/retail development in the CBD across from the active, as some doubled up or moved in with family to save
new BOK Arena. money. Others took advantage of the $8,000 first-time home
2014 Estimated 2014 Estimated buyer tax credit. Nearly 1,000 high-end units delivered in
Population 944,580 Given Tulsa’s energy dependence, the stabilization of oil and Population 2,428,948 the downtown area in the first half of the year, and it will
gas prices along with a dose of consumer confidence will take time for those units to be absorbed.
Employment ensure that Tulsa can successfully navigate its mild storm. Employment
Population 492,642 Population 1,093,050 Though 2009 was a challenging year, Portland has solid
commercial property fundamentals, and the metro area is
Household Household well-positioned for economic recovery in 2010. The Portland
metro area is expected to add more than 76,000 jobs in
Median Median the next four years, and environmental services and the high-
Household Income $48,239 Household Income $59,248 tech industry should continue to be key areas of job growth.
37 37
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
New Construction (AAA) $ 19.00 $ 21.00 $ 19.50 N/A New Construction (AAA) $ 25.00 $ 32.00 $ 28.75 N/A
Bulk Warehouse $ 3.25 $4.75 $ 4.07 29.3% Bulk Warehouse $ 4.97 $ 16.04 $ 6.11 14.3%
Manufacturing $ 2.50 $4.00 $ 3.00 7.0% Manufacturing $ 5.14 $ 16.13 $ 6.69 18.9%
High Tech/R&D $ 3.75 $6.00 $ 5.25 4.6% High Tech/R&D $ 5.84 $ 17.29 $1 0.49 15.7%
RETAIL RETAIL
Regional Malls $ 18.00 $ 26.00 $ 22.00 3.5% Regional Malls $ 14.26 $ 34.00 $1 9.25 3.3%


Allentown, Pennsylvania Berks County, Pennsylvania
The Lehigh Valley, located in eastern Pennsylvania, offers Berks County competes for business in the New Jersey,
all of the amenities of major urban areas. The Lehigh Valley New York and Maryland markets. Food companies, plastics,
is the third largest region in Pennsylvania. It is well situated, specialty metals and battery manufacturing are all well
just 95 miles to New York City and 53 miles north of established industries in the area. Medical and financial
Philadelphia. The Lehigh Valley is an excellent location for services are key drivers in the office sector with technology-
business and industry. The Lehigh Valley has 11 higher based businesses rapidly emerging. Private/Public partner-
learning institutions and healthcare facilities that have been ships are effectively linking the Penn Corridor from Reading
recognized nationally and continue to grow in the region. to Wyomissing.
The area consists of an enterprising and diversified economy The office market has shown mixed results. Class A
that has led to higher-income jobs, a growing and thriving vacancy and rental rates have experienced a slight
population and tremendous commercial and industrial downturn, while Class B vacancy is down 10% and rental
growth in the region. The Lehigh Valley is home to some of rates remain flat. Vacancy in the Class C sector is up
the world’s top corporations in a variety of fields, including: with unoccupied properties accounting for over 1.1 million
Air Products and Chemicals, Inc., B. Braun Medical Inc., SF. This spells opportunity for both tenants and buyers.
Binney & Smith, Olympus and many others. Excellent trans- Approximately 300,000 SF of office space was absorbed in
portation access also exerts an important influence on the 2009 with a total of 450,000 SF of new space proposed
Contact Lehigh Valley. The most important highways in the area are Contact for 2010.
NAI Summit Route 22, Interstate 78, which connects the Lehigh Valley NAI Keystone
Industrial inventory levels have risen sharply with 6.1 million
+1 610 264 0200 with Harrisburg to the west and New Jersey to the east, and Commercial & Industrial
SF currently available. Approx. 826,000 SF of new product
major roadways such as Interstate 81 and 83 to the north. +1 610 779 1400
was added during the past year. The market had negative
Route 22 provides fast, limited access between Allentown, absorption of 1,072,100 SF of product compared with
Bethlehem, and Easton. The Extension of the Pennsylvania 243,000 SF of positive absorption the prior year. Lease rates
Turnpike can also be accessed off Route 22 and Interstate are down slightly with landlord concessions a common
78, which connects Philadelphia with Wilkes-Barre and occurrence. Leasing activity is up as many users are unable
Scranton areas. The area is also served by the Lehigh Valley to obtain financing. Gross sale of industrial product was up
International Airport. $23 million over the prior year for a total of $179 million.
The Lehigh Valley market remains an attractive market to Sale prices were down 12% with a prices ranging from
Metropolitan Area investors, importers, exporters, manufacturers and high-tech Metropolitan Area $51/SF for Class A space to $29/SF for Class C.
Economic Overview companies. Developers, enticed by abundant land, favorable Economic Overview
Residential new construction is down 47% with developers
2009
taxes, the lure of railway access and infrastructure, continue 2009 sitting on over 2,000 approved, but unimproved lots. Notable
Population 810,773 to secure land positions along Route 22 and Interstate 78 Population 403,204 retail projects include the 500,000 SF Exeter Commons and
corridors. Rental rates in all markets have remained a 253,000 SF shopping center in Temple. The $75 million
2014 Estimated relatively stable despite the economy. 2014 Estimated
Wyomissing Square development is complete with 248
The industrial market continues to be one of the regions apartments and a 135-room Marriot Courtyard. A 215-room
Employment largest growth areas. Modern shopping malls, big-box and Employment Doubletree has been proposed with completion scheduled
Population 366,200 lifestyle centers remain popular. Several developments have Population 190,940 for 2010.
Household
recently been completed, including Promenade in Saucon Household Watch for a Technology Park to be developed at the
Average Income $68,490 and Airport Center along Route 22. Average Income $68,129 Reading/Berks Airport and the emergence of Bryne Eyre, a
3,000 Acre PRD at the I-176 and PA Turnpike interchange.
Median Median
Household Income $57,235 Household Income $56,582 The BOSS 2020 program will enhance traffic flow and boost
development of Sinking Spring Borough and its vicinity.
40 38.5
Allentown At A Glance Berks County At A Glance

RETAIL RETAIL


Bucks County, Pennsylvania Harrisburg/York/Lebanon, Pennsylvania
The Bucks County industrial market totals 55.5 million Central Pennsylvania is home to many prominent, high profile
SF and is a premier location for both industrial and office Fortune 500 companies, including Hershey Foods, Rite-Aid,
businesses. Bucks County is strategically located north of HARSCO, Graham Packaging and GIANT Foods. As the Capital
the city of Philadelphia, with immediate access to I- 95 and City of Pennsylvania, Harrisburg has a large public sector
I-276, and is located in the heart of the Boston to Washington, base. The combination of government, manufacturing and
DC, corridor. medical industry has resulted in a stable local economy year
Inventory for lease and sale remains readily available. Sale after year. Central Pennsylvania has encountered some market
prices declined approximately 10% and product remained contraction led by the industrial and investment sectors.
on the market for a considerably longer period of time. The region’s office market has experienced weakening
Lease rates have become more competitive with aggressive demand due to job cuts and business closings. Office rental
landlord concessions. The vacancy rate increased 2% from rates are down approximately 10-15%, while absorption
last year to approximately 13%. rates were generally flat. However, there are some bright
Bucks County features two of the best land tracts available; spots. The Commonwealth of Pennsylvania’s 411,000 SF
1,200 acres within the Keystone Industrial Port Complex master lease at 555 Walnut Street is the largest lease year-
(KIPC) and another 250 acres in Langhorne, Pennsylvania. to-date and probably in the history of the mid-state office
Notable transactions include Abington Metals completing market. Approximately 160,000 SF of new inventory entered
Contact Contact the market in 2009, far lower than what was projected in
their high-tech 50,000 SF build-to-suit and AE Polysilicon
NAI Mertz NAI CIR 2008.
with their $53 million facility still under construction. These
+1 215 221 1100 +1 717 761 5070
two transactions are both located in the KIPC. With economic uncertainty impacting the demand for ware-
The Bucks County office market activity also slowed house space, and recently executed speculative building
dramatically with considerable sublease space available as projects increasing an already sizeable inventory, the
companies continue to downsize and show the effects of region’s industrial real estate market suffers from unprece-
the recession. Vacancy at year end stands in the 20% range, dented vacancy rates. Landlords seeking tenants in the
reflective of the weakened economy. The total net office 100,000 SF to 350,000 SF range have an overwhelming
absorption remains negative and correspondingly, rental rate set of competing buildings, particularly at the Class A level,
growth continues to be negative with concessions increasing, which has forced them to explore innovative incentives to
as landlords try to compete with the inexpensive rental rates remain competitive. Landlords are placing significant down-
Metropolitan Area Metropolitan Area ward pressure on near-term rents to secure tenants.
and flexible terms that most sublease space affords.
Economic Overview Currently, leasing activity is composed of mostly renewals Economic Overview However, beyond the three- to five-year horizon, there
2009 and absorption of sublease space. Average Class A rent 2009
is reluctance by institutional investors to discount that
Population 616,356 remains steady at $25.50/SF, with Class B space averaging Population 535,917 perceived future market rental. Despite rising vacancy
around $20.23/SF and Class C rent averaging $19.18/SF. rates and lower rental rates, retail development in Central
2014 Estimated 2014 Estimated Pennsylvania remained relatively active during 2009
Population 604,078 Keystone Industrial Port Complex was designated a KOIZ, Population 553,096
adding 1,259 acres of heavy industrially zoned land with Cedar Shopping Centers completed two grocery anchored
Employment
port and rail facilities. KOIZ offers companies special tax Employment shopping centers, Blue Mountain Commons in Lower Paxton
Population 320,335 Population 357,066 Township and Northside Commons Shopping Center in
exemptions and abatements on their real estate, state and
Household local taxes, as well as priority for state and local financing Campbelltown. Pacific Development has begun construction
Household
Average Income $87,172 programs. Average Income $66,334 on Newberry Commons, a Wal-Mart anchored shopping
center, located in Newberry Township, York County.
Median Median

41.4 40
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 $ 8.00 $ 18.00 $ 13.00 12.0%


Lancaster, Pennsylvania Philadelphia, Pennsylvania
Lancaster continues to benefit from a diverse economic Philadelphia transitioned from an industrial/manufacturing
base even in the face of today’s turbulent economy. While city into a center of finance, insurance, telecommunications,
property values and lease rates have declined, statistics biopharmaceuticals, aerospace, education and tourism. It is
show much less downturn than other parts of the country. home to cable giant Comcast. The largest private employer
New development exists in many segments of the market in the city is the University of Pennsylvania. Philadelphia
and is expected to continue through 2010. continues to receive interest on a global basis as heavy
The revitalization of downtown Lancaster strengthened manufacturing/high-tech/drug/alternative energy companies
with the long anticipated opening of the Lancaster County seek labor, power, rail, port and economic incentives offered.
Convention Center and 300-room Marriott Hotel. Other 2009 was a difficult year. Activity was consistently slow
notable projects include Urban Place, a redevelopment of throughout the year. Inventory for lease and sale is in strong
the Kerr Glass complex into a mixed use development supply causing sale prices to slide approximately 15% and
of over 300,000 SF. Also under way is the redevelopment of rental rates to be most competitive and creative.
the 65-acre Armstrong World Industries site by a joint The Philadelphia industrial marketplace totals over 100 million
venture of Lancaster General Hospital, Franklin & Marshall SF. The vacancy rate in 2009 increased almost 4% to ap-
College and our local EDC. proximately 13%. Large land parcels are scarce throughout
Contact The economic downturn has impacted Lancaster’s real Contact the Delaware Valley, but Philadelphia features large tracts
estate market in varying degrees. The industrial sector has in the Philadelphia Navy Yard and smaller parcels located in
NAI Commercial NAI Geis Realty
been less impacted overall with stable occupancy levels and controlled industrial parks. Industrial land prices range from
Partners Inc. Group, Inc.
moderately lower lease rates. The office sector continues $100,000 to $150,000 per acre. The Naval Yard was
+1 717 283 0600 +1 215 568 7222
to be soft, especially for Class B and C space, with overall designated a KOIZ adding 1,200 acres of industrially zoned
lease rates declining by 15-20%. Most office transactions NAI Mertz
land with port and rail facilities. The Naval Yard has approx-
have been as a result of specialized medical and financial +1 215 221 1100
imately 200 acres for sale or lease. KOIZs offer companies
services companies occupying newer Class A facilities. special tax exemptions and abatements on their real estate,
The retail occupancy levels have been impacted by a loss of state and local taxes, as well as priority for state and local
tenants such as Circuit City and Linens and Things, yet financing programs to locate within a designated KIOZ
Lancaster continues to be under stored. Recent projects through December 31, 2018.
Metropolitan Area include the development of a new Lowe’s and Best Buy at Metropolitan Area The Philadelphia County retail vacancy rate increased slightly
the former Crowley Foods site, as well as a reported Kohl’s- to approximately 12% in 2009. Strong convention and
Economic Overview anchored center of approximately 250,000 SF. In addition, Economic Overview tourism business continues to stimulate the economy. New
2009 there are several other large retail projects that remain 2009 restaurants continue to open and the $550 million dollar
Population 506,093 in the development pipeline that comprise more than Population 5,826,970 Sugar House Casino is under construction along the
1.5 million SF. Delaware River. There is still strong redevelopment activity
Population 524,597 Looking forward, we anticipate further stabilization of Population 5,821,451 of existing retail shops and retail centers within the county.
market conditions as we enter 2010, including increases Pennsylvania Governor Ed Rendell has staked a large
271,223
in absorption rates and a positive trend in overall property 3,030,142
investment in the state’s future on alternative energy with a
values and rental rates. Lancaster’s wide range of agricul- very ambitious program aimed at attracting developers and
Household tural, manufacturing, retail, medical, service and tourist Household manufacturers of wind, solar and other energy technologies.
Average Income $63,861 related businesses provide the foundation for a revitalized Average Income $78,541 This initiative has already attracted Spanish wind turbine
local marketplace. manufacturer Gamesa Corporación Tecnologica to the
Median Median
Philadelphia region.

38 39
Lancaster At A Glance Philadelphia At A Glance

RETAIL RETAIL

Retail/Commercial Land $ 150,000.00 $ 500,000.00 Retail/Commercial Land N/A N/A

Pittsburgh, Pennsylvania Schuylkill County, Pennsylvania
Pittsburgh, through imaginative reinvention, has emerged Located in the heart of anthracite coal country, Schuykill
from a post-industrial economy to a shining 21st century County is shaking off its coal roots to emerge as a service,
city. President Obama selected Pittsburgh for the site of the technology and small business-based economy. Schuylkill
2009 G-20 Summit. Home to Carnegie Mellon University, County, with its rural character and a sparse population within
The University of Pittsburgh and the University of Pittsburgh its 779-square-mile area, exemplifies an essential quality of
Medical Center, Pittsburgh continued to see economic small town America: hard-working people doing their utmost
growth in technology, medical science, robotics, financial to improve their quality of life. Now and again small packages
industries and now, due to the discovery of Marcellus Shale produce big results. This is definitely true here.
gas deposits, a leading energy center. Investment continues in the 2,000 acre Highridge Business
The Office Market has a vacancy rate of 10.5% with positive Park. Notable companies include the 1.2 million SF Lowes,
net absorption of 388,613 SF. In a major expansion of its 1.4 million SF Big Lots, Office Max with 600,000 SF and
nuclear power engineering operations, Westinghouse Wal-Mart with 900,000 SF of space. Wal-Mart now employs
Electric Company finalized a lease for a new, three-building, 1,050 people in the area. Sara Lee recently opened a new
772,000 SF build-to-suit project. We forecast significant 182,000 SF frozen food distribution center. New companies
positive net absorption through 2010 with available moving into Schuykill include Electrolux with a modern
office space trending downward. In particular; the Oakland 455,000 SF plant and Gordon Food Service in a 150,000
Contact Submarket has pent-up demand for large blocks of Class A Contact SF plant.
NAI Pittsburgh Commercial space. However, sites in the Oakland Market are difficult to NAI Keystone Commercial
Solar Innovations opened a new $8.1 million, 206,000
+1 412 321 4200 secure and the current lending environment is problematic & Industrial, LLC
SF Leed-Certified facility in the Pine Grove Business Park.
for developers. +1 610 779 1400
Wegman’s is expanding its 570,000 SF distribution center
The Industrial Market has a vacancy rate of 9.5%, which with a $7 million, 350,000 SF temperature-controlled ware-
represents a positive net absorption of 388,064 SF. The Flex house. The project will install alternative fuel cell distribution
market recorded net absorption of negative 121,993 SF. The technology for fueling 150 material handling vehicles.
largest lease signing in 2009 included 20th Century Fox In other Green news, Locust Ridge Wind Farm has now
committing to a 330,000 SF lease. Industrial quoted rates grown from 13 to 51 wind turbines that will generate 128
are steady at $4.99/SF and the average quoted rental rate megawatts of electricity.
for Flex was $9.91/SF. The total industrial inventory in the Pottsville anchors the medical system, professional buildings
Metropolitan Area Pittsburgh Market amounted to 149,794,391 SF comprising Metropolitan Area
and governmental offices and is also home to Yuengling,
Economic Overview 3,920 buildings. Economic Overview America's oldest brewery. The Pottsville/Schuykill Technology
2009 The Retail Market vacancy rate is 7.2%. The largest lease 2009 Incubator serves the area well and is one of many efforts to
Population 2,323,152 signing in 2009 included Lowe’s Home Improvement leasing Population 146,970 retain the younger demographic and promote new business
124,000 SF. Despite the distressed retail in other U.S. starts in the area.
Population 2,242,696 markets, Pittsburgh has continued to see growth in the Population 146,141 Retail construction and leasing cooled off through 2009 with
development of new lifestyle centers and retail projects. sites along the Route 61 Corridor in the highest demand.
1,202,050
Pittsburgh’s investment market continues to see capitaliza- A new, $19 million Intermodal Center that will include a
tion rates in the single digits. Medical office and multi-family three-story office building is slated to open in Pottsville.
Household housing are the strongest sectors, while office and industrial Household The Schuylkill County Economic Development Office spear-
Average Income $62,683 continue to struggle. Average Income $53,395
heads economic development activity and interacts with the
Median Median Schuylkill Economic Development Corp (SEDCO), Tamaqua
Household Income $46,957 Household Income $41,310 Industrial Development Enterprises (TIDE), and Mahanoy
Area Joint Industrial Corp (MAJIC). SEDCO manages 12
43 42.4
industrial parks that represent more than $1.1 billion in
capital investment in the last nine years.
Pittsburgh At A Glance Schuylkill County At A Glance

Manufacturing $ 2.50 $ 13.00 N/A N/A Manufacturing $ 2.75 $ 4.25 $ 3.25 6.5%
High Tech/R&D $ 10.00 $ 16.00 N/A N/A High Tech/R&D $ 4.75 $ 7.50 $ 5.50 8.0%
RETAIL RETAIL
Regional Malls $ 25.00 $40.00 $ 37.50 7.5% Regional Malls $ 17.00 $19.00 $ 18.00 6.5%

Office in CBD $ 1,000,000.00 $ 4,000,000.00 Office in CBD N/A N/A
Residential $ 40,000.00 $ 1,000,000.00 Residential $ 15,000.00 $ 30,000.00

WilkesBarre/Scranton/Hazleton, Pennsylvania Columbia, South Carolina
This area had been traditionally dominated by coal production The Columbia economy is anchored by recession-resistant
and heavy industry. However, the excellent highway system industries. The State of South Carolina is the region’s largest
that runs through Northeastern Pennsylvania--Interstates 81, employer with nearly 25,000 employees. Fort Jackson and
80, 84, 380, 180, and the Northeast Extension of the McIntire Joint National Guard Base employ around 10,000
Pennsylvania Turnpike--has transformed the region into the people. Both gained additional employees as a result of the
epicenter for major companies to locate mega-distribution last round of Base Realignment and Closure process. The
centers to service the Northeast and Mid-Atlantic population region is also home to six universities that collectively
centers, as well as for backroom office operations. employ around 6,000 people. Columbia is also a regional
Throughout 2009, few companies were looking to expand medical center with three major hospital systems.
and most were looking to consolidate operations. It is a Columbia has about 9.7 million SF of office space and
buyer’s market without question. Rents have traditionally has experienced average annual absorption of 85,000 SF.
floated between the low- to mid-$4/SF price for new Occupancy at mid-year was 83.4%. Landlords have held
construction. Over the past year, developers have dropped rents steady over the last year but are providing additional
the starting rates of new buildings below $3/SF and under tenant improvement dollars and free rent as concessions. In
$2/SF on older product. 2010, the completion of a 197,000 SF building in the CBD
Encouragingly, the market in the latter part of 2009 has will create three large spaces in Class A and B buildings,
Contact Contact which tenants will use as leverage for additional concessions
shown slight signs of improvement. There are companies
NAI Mertz of NAI Avant, LLC as their leases renew.
that once again are looking to expand and or relocate to the
Pennsylvania HQ +1 719 577 0044
area, but with plenty of supply in the market, rents have not The retail market has 21.2 million SF. About 575,000 SF
+1 570 820 7700
yet begun to stabilize. Today, speculative development is are absorbed annually on average. Rents in Class A retail
non-existent. Companies prefer existing buildings that are centers range from $16 to $22/SF. Occupancy fell market-
offering deals that represent a deep discount compared to wide by mid-year to 88.7% largely as a result of several “big
ground up development. box” national tenants closing stores.
The availability of tax incentives such as KOZ and LERTA The industrial market has 33.8 million SF of space. Occupancy
that offer significant savings, are helping to keep the area fell at year end to 93%. Rents have remained stable
attractive for relocations. The retail and office sectors are because there are a relatively small number of high quality
Metropolitan Area both experiencing extended lease-up periods. Over the past buildings that meet current market requirements. Recent
Metropolitan Area
several years, intense development of retail projects and developments include a 400,000 SF distribution center for
Economic Overview anemic office demand has been the norm, however office Economic Overview Home Depot in the Lexington County Industrial Park. Miller
2009 leasing and construction continues in the health care sector. 2009 Valentine is building a 176,000 SF multi-tenant warehouse
Population 546,576 Downtown office resurgence, while weak, reflects the green Population 742,896 next door and Kirco recently completed an 186,000 SF
mentality brought on by the economy. building in Northeast Richland.
Population 539,170 Highlights in the market are the opening of a 460,000 SF Population 809,744 The number of significant transactions this year has been
distribution center by Home Depot in Centerpoint, Pittston. limited to lease renewals and purchases by end users
302,837
Tootsie Roll opened a 240,000 SF facility in the Humboldt 382,376
of office, retail, and industrial space. The largest transaction
Industrial Park. Benco Dentals will open a 198,000 SF facility was the purchase of an 80,000 SF office building for
Household in Centerpoint and Common Wealth Medical College opened Household the international headquarters of Pure Fishing in Northeast
Average Income $54,450 in Scranton. Average Income $60,570 Richland.
Median Median

42 37
WilkesBarre/Scranton/Hazleton At A Glance Columbia At A Glance

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


Greenville/Spartanburg/Anderson Counties, South Carolina Sioux Falls, South Dakota
The Upstate area felt the national economic downturn this One of the fastest growing areas of the United States during
year but still retained a top-ranked business climate and the past decade, Sioux Falls’ strong metro territory has
affordable cost of living, making it an attractive place to live brought hundreds of businesses to the region. For the sixth
and work. The Upstate is among the fastest growing regions consecutive year, Forbes voted Sioux Falls first among US
in the nation and is continuously recognized as an appealing cities with populations of 50,000-177,000 as the best place
and well planned area with a bright future. for business. Sioux Falls was also voted number eight
The office market continues the upward trend in vacancy as for 2009-2010 as one of the 60 US Hotspots for Young,
tenants downsize or sublease. Tenants in Class B and C Talented Workers for cities with a population of 100,000-
buildings are relocating to Class A space for below standard 200,000.
rates. On a positive note, the local hospitals continue to The Sioux Falls office market inventory consists of approx-
absorb general office space. imately 9,010,407 SF. Of that, 7,942,245 SF is occupied,
Industrial market rates have decreased resulting from an resulting in a vacancy rate of 11.85%. The office vacancy
increase in vacancy. Sales and leasing volume have slowed rate has increased just over 1% compared to 2008
while capitalization rates have increased. However, activity statistics.
appears as though it may steadily increase as we approach Sioux Falls is said to be the largest retail option between
Contact 2010. Retail vacancies have been up and rental rates are Contact Minneapolis and Denver. The Shoppes at Dawley Village
down, but owners are offering attractive incentives. This is a 70-acre retail development that includes Target. Plans
NAI Earle Furman, LLC NAI Sioux Falls
year, Academy Sports opened, Rooms To Go purchased a for more national retailers are in progress. The CBD
+1 864 232 9040 +1 605 357 7100
site at Magnolia Park and Easley Towne Center is under way is undergoing renovation and continues to add offices,
with leases from Wal-Mart, Bed Bath & Beyond and eight to restaurants and shops.
ten small retailers. The Sioux Falls industrial market felt the strain of the
Supply is still overpriced in the investment market due to national economy in 2009 as decision makers delayed
many owner/developers holding capitalization rates where any major decisions. Build-to-suit activity was off pace,
they were a year ago, but available financing will not generate (yet impressive), with several projects at various stages
required returns for sideline investors. However, many of the of development. We are currently experiencing high demand
astute owner/developers have increased capitalization rates and look for a strong year in 2010. To date, large tract
Metropolitan Area
from as little as 50 basis points to as much as 150 basis Metropolitan Area
development land sales have come to a virtual halt with
points over similar properties from a year ago, and these the change in the economic conditions and sizable level of
Economic Overview properties are trading today. An upscale 346-unit apartment Economic Overview inventory. Prices for raw land appear to be trending downward.
2009 complex on Woodruff Road is set to begin leasing in 2010. 2009 Many different styles of apartments are located throughout
Population 284,347 The Hilton Garden Inn opened and a Courtyard Marriott is Population 253,027
the area; from historic lofts in the CBD to newer complexes
scheduled to open in 2010 in Downtown Greenville. located in the outlying sections. The area's steadily growing
Population 306,303 In 2009, redi-Group announced it will locate its new North Population 316,658 population has helped fuel the demand.
American headquarters in Greenville. The company offers Today, the community is experiencing growth and expansion
Employment a wide range of services to automotive companies both Employment
Population 148,606 Population 146,380 in the technology, healthcare, retail, construction and
domestically and internationally. In addition, Samsung research sectors. Greater Sioux Falls has not experienced
Household announced plans for its North American Customer Care Household the extreme lows of other markets, which has allowed
Average Income $51,519 Center in the Centerpointe Business Park in Mauldin. Average Income $62,615
investors to enjoy consistency and reasonable returns
Median Median benefiting from its stability.

38 35
Greenville/Spartanburg/Anderson Counties At A Glance Sioux Falls At A Glance

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


Chattanooga, Tennessee Clarksville, Tennessee
Even though the national economy is suffering, Chattanooga Clarksville is the fifth largest city in the state of Tennessee and
continues to have good news and is looking forward the 17th fastest growing city in the United States. The city of
to 2010. Long noted as a great place to live, Chattanooga Clarksville, adjacent to Fort Campbell Military Base, enjoys an
now is a great place to work because of the 775,000 SF expanding and diverse industrial base, a vibrant residential
Volkswagen assembly plant. When the cars roll out in 2011, market and is home to Austin Peay State University.
the plant will deliver an immediate demand for 2,000 new Hemlock Semiconductor Corporation, one of the world’s
employees and up to 12,000 jobs created by tier-one and leading suppliers of polycrystalline silicon products, is
tier-two suppliers. currently constructing a 1.5 billion dollar facility which will
This is the first time in recent memory that there is an ample become operational in late 2012. Conwood Corporation,
supply of quality buildings in the 100,000 to 250,000 SF a subsidiary of R. J. Reynolds, recently purchased a one
range. Once the tier-one and tier-two suppliers are an- hundred ninety three acre site and will invest 130 million
nounced, these buildings will be absorbed. Then Chattanooga dollars expanding their existing operation in Clarksville.
will have a shortage of industrial space that will spur Other corporate citizens with manufacturing facilities in
build-to-suit and speculative industrial development. With Clarksville include The Trane Company, Quebecor World,
the current vacancies, property owners and brokers are Jostens, Bridgestone Metalpha, Florim, US Zinc and
holding their breath until the suppliers are announced. the Robert Bosch Corporation. A new 200 million dollar
Contact Contact hospital facility was recently constructed and is operated
The office market in the CBD remains stagnant even though
NAI Charter Real Estate NAI Clarksville by Community Health System.
Blue Cross Blue Shield of Tennessee relocated to its new
Corporation +1 931 648 4700
950,000 SF corporate headquarters on the peripheral of Austin Peay State University is the fastest growing university
+1 423 267 6549
downtown in Q1 of 2009. Blue Cross vacated almost in the Tennessee Board of Regents system with enrollment
400,000 SF in three different office buildings. Office rates exceeding 10,000 students. APSU offers 57 majors allowing
have remained flat and there have not been any major office students to earn a bachelor’s, master’s or education
user relocations. The Suburban market has two Class A specialist’s degree. In addition, the university boasts two
office parks competing for tenants, which makes rates accomplished Centers of Excellence and four Chairs of
very attractive. Of the almost 100,000 SF of vacancy, Excellence.
an estimated 60,000 SF has been absorbed in the last There is a good supply of new land available for retail, office,
12 months. industrial and residential development. Land prices are
Retail development is lethargic with no new projects typically lower than those found in comparable markets.
Economic Overview announced since late 2007. The Hamilton Place Mall area Economic Overview Currently there is a shortage of warehouse space primarily
2009 remains the driver and premier retail location with Northgate 2009 resulting from the entrance of Hemlock Semiconductor and
Population 550,922 Mall in the Hixson submarket as a strong second. Downtown Population 302,924 related suppliers into the market. Construction of retail
activity, especially in the North Shore market, is active. space has slowed due to the national economy. However,
Population 642,126 Chattanooga promotes sustainable growth and with VW Clarksville enjoys a stable retail environment as evidenced
Population 403,655
pumping new life in the industrial sector this combination by increased sales tax collections.
Employment
will create a healthy local economy. Downtown is alive and Employment CNN Money recently ranked Clarksville as the fourth best
one example of this is the recent announcement of the metro area to launch a business. Clarksville has also been
Household Maclellan Building being converted to a boutique hotel by Household ranked as one of the top 100 real estate markets and one
Average Income $60,904 the Indigo Group. Average Income $55,492 of the 20 best performing cities in the country’s 200 largest
metro areas.
Median Median

Median Age 39 32
Median Age
Chattanooga At A Glance Clarksville At A Glance

RETAIL RETAIL

Land in Office Parks $ 125,000.00 $ 250,000.00 Land in Office Parks $ 3.00 $ 8.00
Office/Industrial Land - Non-park $ 100,000.00 $ 300,000.00 Office/Industrial Land - Non-park $ 1.00 $ 4.00
Retail/Commercial Land $ 200,000.00 $ 1,500,000.00 Retail/Commercial Land $ 8.00 $ 15.00
Residential $ 60,000.00 $ 125,000.00 Residential $ 0.60 $ 1.50

Knoxville, Tennessee Memphis, Tennessee
Knoxville’s economy, unanchored by any single industry, has Memphis only delivered two large speculative office prod-
seen a downturn in 2009. A number of major employers ucts this year, preventing a glut of space from being placed
have been impacted by the economy and this is reflected in on a slow market. Industrial real estate development has
commercial real estate. Businesses are reluctant to make slowed as some larger vacancies have hit key submarkets
real estate commitments despite the fact that prices have but leasing activity has been strong. Retail development
been adjusted downward. stopped mid-year and rental rates have declined. Memphis
Office transactions have seen shorter term commitments office vacancy rates rose slightly to 12.6% due to negative
by tenants and lower rates, both for new leases and for year-to-date absorption of 26,174 SF.
renewals. Despite the Brookview Center leasing 30,000 SF The slow down in the market has kept pace with the down-
to the largest law firm in the state and 58,000 SF to a turn in the economy, resulting in only two large, speculative
medical staffing company and The Scripps Network doubling properties, Boyle Investment Co.’s recently completed
the size of its corporate headquarters, vacancies are up and 150,000 SF office building and Highwoods Properties
returns to owners are dropping as rental rates fall. Industrial 150,000 SF Triad Centre III, coming on the market. UT
activity has been very slow. Closings and layoffs have Medical Group, Inc. had the largest lease of the year with
occurred such as the closure of America’s largest magazine 85,651 SF at Mid Memphis Tower.
distributor, which cost 400 jobs. Much of the leasing activity in Memphis has been renewals
Contact Contact
Some expansions have begun including Green Mountain and expansions, with a few companies taking advantage of
NAI Knoxville NAI Saig Company
Coffee’s new packaging plant and a furniture maker opening the depressed market to change properties. Lease rates for
+1 865 777 3030 +1 901 526 3100
in Morristown to supply IKEA. Meleleuca and Exedy America the overall office market remained fairly steady at
Corporation began expansions that will add 540 jobs to the $16.84/SF with the largest submarket, East Memphis, at
marketplace. 1.5 million SF, seeing a Q3 increase to $19.41/SF.
Retail has suffered with vacancies in all geographic areas. With Kuehne+Nagel, Inc. taking its 865,120 SF of sublease
Chain restaurants in particular have been right-sizing space off the market and Conwood Co. LLC purchasing a
by closing units. One significant transaction that took place 787,500 SF building in Southeast Memphis, the amount of
was the lease signing by big box retailers, although active in large warehouse space has decreased. Direct vacancy
market and site analysis, are waiting to see if more bargains overall, remained steady at 13.8%, the same as Q1 2008.
can be had. Two large developments Dumplin Creek in Metropolitan Area Memphis experienced 195,855 SF of positive absorption
Metropolitan Area Sevier County and the Sherrill tract in Knox County have and lease rates dipped slightly to $2.62/SF. Several national
fallen victim to more aggressive negotiating and delays as companies looking for large blocks of space could edge
2009 developers nationwide complete for the tenants. The only 2009 lease rates upward next year.
Population 706,862 multifamily or hospitality development has been the continu- Population 1,286,151
Retail vacancy tightened to 8.9% in Q3 2009 compared to
ation of projects under way in 2008. Vacancies in all 10% in Q3 2008. Several national big box retailers closed
segments are hovering around 10%. Population 1,301,835 Memphis-area stores, but that space was backfilled fairly
Population 770,531
A major auto parts manufacturer closed a new plant in quickly by more robust companies.
Employment
Employment Knoxville as did an international electronics manufacturer, 679,256 Memphis saw a drop in average asking rental rates, down
creating almost 700,000 SF of vacancy. A major office to $10.98/SF. The Memphis office market is not overbuilt,
Household employer that manufactured molded plastic signs, largely Household allowing vacancy to drop as the economy improves and
Average Income $58,049 for the auto industry, closed, as did a lower price point retail Average Income $63,599
companies expand. The market could see speculative
clothing chain headquartered here. industrial development as soon as late 2010, most likely in
Median Median
Household Income $47,048 Household Income $52,090 the DeSoto County submarket.

39 35
Knoxville At A Glance Memphis 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
Bulk Warehouse $ 2.00 $ 4.00 $ 3.25 12.0% Bulk Warehouse $ 1.00 $ 4.05 $ 2.55 N/A
High Tech/R&D $ 4.75 $ 15.00 $ 9.00 6.0% High Tech/R&D $ 1.00 $ 19.80 $ 10.40 N/A
RETAIL RETAIL
Community Power Center $ 12.00 $ 26.00 $ 17.00 8.0% Community Power Center N/A N/A $ 8.00 24.7%
Regional Malls $ 28.00 N/A N/A N/A Regional Malls N/A N/A N/A N/A


Nashville, Tennessee Austin, Texas
The cost of living in the Nashville region is 10% below the Austin, the state capital of Texas, is ranked at the top of several
national average due to the lower costs of housing, transnational metro comparison studies, including Best City for
portation, utilities and many tax benefits, including no state Recession Recovery (Forbes, June 2009), Third Strongest
income tax. As a result of these economic opportunities, Metro Economy in the Nation (Brookings Institution,
Nashville continues to dominate many prominent lists. June 2009), and the Nation’s Best City For A Fresh Start
Business Facilities ranked the Nashville Metro number one (Relocation.com, June 2009).
for Quality of Life, number six for Best Cost of Living, and While news is good for economic development in Austin with
number nine for Economic Growth Potential while POLICOM only 7.2% unemployment, it has become a hindrance to
ranked Nashville number five for Economic Strength. commercial property transactions by widening the bid-ask
Vacancy rates rose during 2009 for the office, industrial and gap. Sellers lock in on good news and try to wait out the
retail markets and should begin to stabilize by mid 2010. recession for a higher price, while buyers hold out for
During the course of the year, 2.7 million SF of product was cheaper deals. The lack of adequate financing remains a
added to the market, which further increased the vacancy major obstacle requiring buyers to pool equity to close all
for all sectors. Another factor in the increased vacancy is cash deals.
that sublease space has risen over the course of the year The office market failed to absorb 600,000 SF in the first
with more than 2 million SF of space on the market. The half of 2009. Luckily almost 300,000 SF of mostly Class A
Contact office market has witnessed some moderate gains during Contact
space was absorbed in Q3. Landlords work hard to keep
NAI Nashville the year while industrial is still trying to recover. NAI Austin
existing tenants and make attractive deals through rent
+1 615 850 2700 +1 512 346 5180
Retail vacancy has risen but has little sublease space concessions. The average rental rate at the end of Q3 was
available. Over the past five years, the Nashville MSA was $25.52/SF per year.
a landlords’ market with minimal concessions given to Austin’s industrial leasing inventory grew from 34.5 million
tenants. To keep occupancies up, landlords have given SF in 2007 to 37.9 million SF by mid-2009. A total of
tenants more concessions such as free rent and additional 3.4 million SF was added in an 18-month period. This
TI allowance to compensate for the increase in available represents an increase of 10% of gross inventory. As a
new space and sublease space they are competing against. result, no institutional grade product is under construction in
This trend will remain in favor of the tenants until new the Austin area and rents continue to erode.
product and sublease space is absorbed and the number of
Metropolitan Area choices for tenants decreases. Metropolitan Area During 2009, 618,940 SF of retail was delivered, while only
Economic Overview Economic Overview 278,130 SF was absorbed. This resulted in average rental
Notable leases in 2009 include: Nissan’s 717,000 SF lease rates decreasing by $2.81/SF from December of 2008 to
2009 at Couchville Pike II; Genco’s 319,375 SF lease at 3815 2009
June of 2009.
Population 1,649,381 Logistics Way; Synnex Corporation’s 307,200 SF lease at I- Population 1,762,915
24 Distribution Center 2 and Simplex Healthcare’s 91,253 Development for the most part has come to a grinding halt
2014 Estimated 2014 Estimated across all product types. There is a wait and see attitude
Population 1,967,166 SF lease at Cool Springs IV. Population 2,180,846
among developers and investors. The lack of adequate
With continued fears of an unstable economy, Nashville’s financing has been a major obstacle, so buyers are pooling
842,148
commercial real estate sectors will remain shallow through 832,927 equity to close all-cash deals.
the first half of 2010. However, Nashville is in a good position
Household to withstand the downturn and rebound more quickly than Household
Average Income $69,054 other markets in the US because it supports a wider array Average Income $76,318
of industries.
Median Median

37 33
Nashville At A Glance Austin At A Glance

RETAIL RETAIL
Sub Regional Centers $24.00 $28.00 $ 26.00 6.0% Sub Regional Centers $ 15.00 $ 30.00 $ 22.00 10.0%
Regional Malls N/A N/A N/A N/A Regional Malls $22.00 $ 45.00 $ 33.50 5.0%


Beaumont, Texas Corpus Christi, Texas
Southeast Texas is in the midst of an industrial expansion The Corpus Christi economy suffered slightly from the
totaling an estimated $15 billion in the petro chemical economic downturn. The petrochemical industry is down,
industry. The industrial and multifamily sectors have benefited resulting in a decline in the local economy. However, the
most from this expansion. Retail space is flat. Office space refineries and related industries are expanding and upgrading
has not benefited as vacancy continues to climb. Land is in anticipation of the pending increase in oil and gas
not moving well due to financing issues. Investment property exploration. The Port of Corpus Christi is doubling in size to
continues to do well but has also slowed. The medical office meet future demand.
market is doing well as SETX's medical community continues The office market continues to lag behind the rest of the
to grow. real estate market. Numerous national and regional
In 2009, there was an increase in new hotels and apartment companies have closed their offices and/or are downsizing.
complexes built to house workers from the expansion of Office rents in Class A buildings have dropped enough to
several industrial plants. However, this has slowed with cause tenants from Class B and C buildings to consider
some projects pulling back toward the close of the year. We moving up. It is anticipated that occupancies in Class A
expect a drastic increase in the number of construction jobs buildings will remain the same while B and C will suffer from
during Q1 2010 as things ramp back up on the almost this migration.
$8 billion Motiva project. The industrial market is down as a result of the decline in the
Contact Contact
The retail markets are flat as sales have dropped, but many petrochemical industry. Exploration and refining have slowed
NAI Fidelis NAI Cravey Real Estate
of the bargain retailers have positioned themselves for significantly over the last year and as a result, many service
+1 409 899 3300 Services, Inc.
expansion in 2010. Port Arthur is still hot for retail growth type buildings with yards came on the market. Large ware-
+1 361 289 5168
while Beaumont and Orange are slow, with Beaumont house buildings are remaining vacant, especially the older
having significant vacant space and others having gone dark dock high buildings.
altogether. Freestanding retail and strip centers are doing well. Large
The industrial market benefited from industrial expansion buildings have been filled with only two, large, vacant
and, unfortunately, from recent hurricanes that destroyed buildings remaining on the market; the former Mervyn’s and
older inventory. This has brought some speculative building the space next to Academy. Steinmart is filling the former
to the market. Cardinal Drive in Beaumont and South are the Circuit City location and Hobby Lobby is expanding in Moore
Metropolitan Area hottest areas for this market. Land deals have dried up as Plaza, the city’s power center. The old Parkdale Plaza is
lenders are requiring upwards of 50% down. Once those rates Metropolitan Area
finally being torn down and replaced with a Super Wal-Mart,
Economic Overview return to more realistic numbers, activity undoubtedly will pick a small shadow center and some pad sites. The redevelop-
2009 up. Despite this situation, prices have remained stable. Economic Overview ment of LaPalmera Mall (formerly Padre Staples Mall) is
Population 370,113
The office market remains flat. Some of this can be attributed 2009 under way at a cost of roughly $50 million. Every part of the
to larger users downsizing and subleasing space available
Population 410,741 mall is being upgraded, including the anchor tenants. The
2014 Estimated
Population 355,016 at lower rates than what landlords are offering. Jobs have only negative in the retail market was the foreclosure of
2014 Estimated
not been created in this area of the market and new job Population 402,092
Sunrise Mall.
Employment
174,485
growth is not predicted in the near future. Some office users The future of Corpus Christi looks bright thanks to expansion
Population Employment
are moving into retail centers, thus having a further negative 189,098
at the port and the anticipation of the $3 billion dollar Las
Population
Household impact on the market. Brisas Power Plant and $1 billion dollar Chinese pipe plant.
Average Income $57,364 Household
Larger deals in 2009 included the HydroTex industrial build
Median to suit as well as several retail lease transactions. Many
Household Income $44,664 large transactions never closed due to lending difficulties. Median
Leasing activity has picked up based on the lending climate Household Income $45,527
Total Population
37 and we suspect it will continue until lenders resume loaning
Median Age Total Population
money again. 35
Median Age
Beaumont At A Glance Corpus Christi At A Glance

Class A (Prime) $ 10.00 $ 12.00 $ 11.00 14.0% Class A (Prime) $ 17.00 $22.00 $ 19.50 17.0%
Class B (Secondary) $ 8.00 $ 11.00 $ 9.50 15.0% Class B (Secondary) $ 9.00 $14.00 $ 11.50 29.0%
RETAIL RETAIL
Sub Regional Centers $ 14.00 $ 22.00 $ 18.50 12.0% Sub Regional Centers $ 9.00 $ 28.00 $ 18.50 12.0%


Dallas, Texas El Paso, Texas
The Dallas area continues to outpace much of the country Bright spots in the El Paso market are highlighted by the
due to its central location and proximity to DFW Airport, one new Texas Tech School of Medicine, the University of Texas
of the busiest transportation hubs in the world. The at El Paso, continued downtown revitalization and explosive
economic conditions of 2009 resulted in companies, both growth at Ft. Bliss. However, the commercial real estate
large and small, choosing short term renewals over making market remains sluggish. Regional manufacturing is down,
long term decisions. warehouse has softened and office and retail are flat.
Dallas has an abundance of land and an extremely compet- Rents and occupancies in the suburban office markets
itive commercial development market. This has helped keep remained flat through 2009 with little change forecast for
real estate lease rates competitive and makes Dallas a 2010. Despite slow leasing, revitalization efforts continue in
favorite spot for corporate headquarter relocations. Even the CBD, where a local REIT and Mills Plaza Properties are
in these trying times, the horizon looks bright as economic re-developing over 700,000 SF of office properties. The
indicators point to an optimistic forecast for 2010 with industrial market, now mostly distribution and logistic space,
employment gains projected to continue to increase. The has softened. There has been no new construction as rents
Dallas/Ft. Worth area currently leads the nation in employ- continue to lag behind the rising construction cost. FoxConn
ment gains for 2009 and the positive numbers are reflected opened its new facility in Mexico at the Santa Teresa crossing,
in what appears to be a healthy office market. occupying an initial 1 million SF in Phase I. Vendors are
Contact Contact being drawn to the area.
There were 91,000 net new jobs added to the North Texas
NAI Robert Lynn NAI El Paso
economy according to the US Bureau of Labor Statistics. The retail market was generally flat in 2009 and no change
+1 214 256 7100 +1 915 859 3017
Office absorption for the same area totaled a negative is expected. The El Paso market experienced slow to no
40,621 SF. Overall vacancy remains flat from a year ago at growth in existing strip centers with shell space, “big box”
17.2%. The largest lease signings of 2009 included the retailers remained non-committal and local and chain
203,239 SF lease signed by AT&T at Lakeside Centre in the restaurant operators encountered tighter financing. However,
Plano/Richardson market and the 201,354 SF deal signed some existing retailers in the marketplace, such as Kohl’s,
by Oncore at the Oncore Building in the Ft. Worth market. Furniture Warehouse and Forever 21, have taken advantage
The Dallas industrial market stands at about 12% vacancy. of the economic environment to strike deals on vacant space
There is heavy competition for every tenant pushing rental for additional stores. Development and pre-leasing activity
rates down while also increasing move-in incentives. continues for the 300,000 SF Phase I of the Fountains, a
Metropolitan Area Metropolitan Area 55-acre power center on I-10. Multifamily has benefited
Absorption rates are in the negative territory for the first time
Economic Overview Economic Overview with the growth of Ft. Bliss. Occupancy exceeds 93% and
in quite some time.
2009 2009
rents are generally between $.72 and $.82/SF per month.
Currently, the retail market in the Dallas/Ft. Worth area has
a 9.4% vacancy rate and a retail rental rate of $13.37/SF.
Population 729,085 Despite the economic downturn, the El Paso business
Net absorption has been in excess of 1 million SF and the climate remains favorable. A positive turn in the global econ-
Population 7,061,395 average rental rate has increased 0.8%. In all, 21 buildings Population 715,271 omy would energize manufacturing in Mexico and stimulate
were delivered totaling just over 300,000 SF. Capitalization warehouse occupancy in El Paso. Ft. Bliss, the new Texas
Employment
rates have averaged 7.9%. Employment Tech school of Medicine, and UTEP, are expected to continue
Population 3,182,487 Population 287,353 to be local growth generators.
Household Household
Median Median

34 31
Dallas At A Glance El Paso At A Glance

RETAIL RETAIL

Retail/Commercial Land N/A N/A Retail/Commercial Land $ 261,360.00 $ 871,200.00

Fort Worth, Texas Houston, Texas
Fort Worth is projected to post positive job growth once Houston’s economy is based on energy, but to a lesser
again despite a three point rise in the unemployment rate extent than in past several years. Its diverse economy
from this time last year. The current rate is 8.3%, still well is composed of research firms, medical and biomedical
below the national average. The Barnett Shale gas play has technology, telecommunications, agriculture and other
slowed by some 60% from last year as prices have dropped distinct businesses. The emphasis on international trade is
and other natural gas deposits have been discovered in expanding and is a prominent theme in the city’s continued
different parts of the US. economic development. Houston’s business appeal is
Fort Worth continues to experience effects of a tight office enhanced by it being one of the least expensive major US
market due to the strong local economy. The Fort Worth CBD cities in which to conduct business.
currently has a 6% vacancy rate in Class A office and a 15% Houston’s office vacancy rate across all classes was
vacancy rate in Class B office. Although healthy, Fort Worth 14.2% in mid-2009 and a low 8.1% in the CBD. A total
is not completely immune to what is happening in the of 15 buildings delivered to the market totaling 1,141,455
market throughout the US. Within the first three quarters of SF, with 3,829,489 SF still under construction. The largest
2009, over 1 million SF of sublease space hit the market in lease signings in 2009 included the 844,763 SF lease
the CBD. signed by Hess at Hess Tower, the 160,000 SF deal signed
Fort Worth’s retail market proved to be somewhat stable. by Locke Lord Bissell & Liddell, LLP at Chase Tower, and
Contact Contact a 232,962 SF lease signed by NRG Texas at Houston
With approximately 4.5 million SF of new construction
NAI Huff Partners NAI Houston Pavilions, each in Houston’s CBD.
delivered in the past 18 months, direct deal velocity definitely
+1 817 877 4433 +1 713 629 0500
came to a staggering halt. Existing tenants and landlords, Houston’s industrial market has remained stable with an
however, have symbiotically created renewal and rework overall vacancy rate of 6.9% and average asking rental rates
structures for tenants to remain in those properties. The Fort of $5.70/SF per year. The largest lease signings in 2009
Worth retail market is seeing about a 91% occupancy level included the 300,000 SF lease signed by Ozburn-Hessey
versus the 94% witnessed in Q4 2008. The average rental Logistics at Bayport North, the 234,000 SF lease signed by
rate of $13.71 is down from the 2008 annual average of Tramontina-USA Inc. at 1641 Gillingham, and the 224,511
$14.50. The theme for 2009 has been tenants want to stay SF lease signed by United DC at Eastport Four.
and landlords need them to stay, resulting in one of the Houston’s retail market has experienced a decrease in
lowest sublet vacancy rates of all time, currently below 1%. vacancy to 9.2% overall. The average quoted asking rental
Metropolitan Area Tenants have taken advantage of reworking their leases, Metropolitan Area
rate is $15.15/SF, which represents a 1.9% decrease over
Economic Overview obtaining lower rates to help offset a decline in their sales Economic Overview
the past year. Average sales prices have risen over the past
2008
revenue in 2009. 2009 several years. Retail properties sold for $171/SF over the
Population 6,409,378 The industrial market shows negative absorption for the Population 5,788,330 past 12 months, compared with $147/SF in the previous
first time in years. The overall vacancy rate for all product period.
Population 7,061,395 types is up four points to 12.31%. No new development at Population 6,183,639 Long recognized as the energy capital of the world, with
this time. Rates have dropped and many incentives are every major energy company represented locally, Houston is
Employment available allowing credit tenants to name their price. The Employment
ranked second among US cities with the most Fortune 500
Population 3,182,487 bid/ask price ratio for sales still remains skewed. Industrial Population 2,746,271
headquarters.
Household
is still out pacing all other product types. Cautious optimism Household
Average Income $75,624 for growth and stabilization of the market place is projected Average Income $76,301
for 2010. Industrial is still outspacing all other product types.
Median Cautious optimism for growth and stabilization of the market Median
Household Income $63,251 place is projected for 2010. Household Income $58,581

34 34
Fort Worth At A Glance Houston At A Glance

Bulk Warehouse $ 2.75 $ 3.30 $ 3.03 10.8% Bulk Warehouse $ 4.08 $7.14 $ 5.31 7.0%
Manufacturing $ 2.50 $ 3.50 $ 3.00 17.0% Manufacturing $ 4.00 $7.80 $ 5.17 3.0%
High Tech/R&D $ 5.00 $ 12.00 $ 8.50 9.1% High Tech/R&D $ 3.00 $33.00 $ 5.38 6.0%
RETAIL RETAIL

Office in CBD 50.00 70.00 Office in CBD $ 185,130.00 $ 217,800.00
Land in Office Parks 220,000.00 675,000.00 Land in Office Parks $ 5,499.00 $ 239,578.00
Land in Industrial Parks 60,000.00 115,000.00 Land in Industrial Parks $ 5,000.00 $ 176,000.00
Office/Industrial Land - Non-park 55,000.00 110,000.00 Office/Industrial Land - Non-park $ 6,875.00 $ 6,098,400.00
Retail/Commercial Land 125,000.00 320,000.00 Retail/Commercial Land $ 2,501.00 $ 6,098,400.00
Residential N/A N/A Residential $ 21,780.00 $ 1,219,680.00
129 2010 Global Market Report www.naiglobal.com 129

(Brownsvile, Harlingen,McAllen, Edinburg, San Antonio, Texas
RIO GRANDE VALLEY, Texas and Mission.)
With a dynamic young labor force, strategic bi-national South Texas has been less affected by the recession than
location, low cost of living and development opportunities, many other areas, but national pressures have moved into
the Rio South Texas region is an ideal location for global San Antonio, the seventh largest city in the US. Still, the Alamo
companies looking to expand or relocate. The convergence City has been identified as one of the top cities (Brookings
of two nations into one region with many choices is the focal Institution) and one of the most recession-resistant (Forbes)
point of a new marketing strategy. in the country.
While commercial real estate activity is down overall in the New construction and investment activity slowed signifi-
Rio Grande Valley as compared to previous years, the market cantly in 2009. The office market added less than 300,000
continues to be one of the strongest in the nation through Q2 SF compared to more than 1.4 million constructed in 2008.
2009 according to the MetroMonitor report by Brookings Only one major warehouse facility with 275,000 SF was
Institution. Despite a slight decline in retail sales, big box completed and retail development was limited to less than
retailers are still entering the market. In 2009 McAllen’s third 1 million SF compared to 3.5 million SF added in 2008.
Best Buy opened and Buffalo Wild Wings is under construction Still, the market maintained some enviable positive momen-
with its second location. CVS entered the Rio Grande Valley tum with the addition of several notable relocations. In the
market in Q1 opening several locations throughout the industrial arena, Toyota Motor Corporation announced that
Valley. Ashley Furniture opened its first McAllen store and production of the Tacoma pick-up truck would be relocated
Contact Contact
Rooms-To-Go and Pappadeaux Seafood Kitchen are both from Freemont, California, to the San Antonio plant starting
NAI Rio Grande Valley under construction in McAllen and Pharr, respectively with NAI REOC Partners, Ltd.
in 2010 creating 850 new jobs. In the satellite community
+1 956 994 8900 Q2 2010 projected openings. Kohl’s, Bed Bath & Beyond, +1 210 524 4000
of Seguin, construction is under way on Caterpillar Inc’s
Forever 21, Shoe Carnival and one additional Walgreens 1 million SF, $170 million engine assembly plant, which is
have entered Brownsville. expected to create more than 1,400 new jobs.
The office market is dominated by healthcare and govern- In the office market, Medtronic, Inc. selected San Antonio
ment agencies with few leases or sales below 5,000 SF. for its new Diabetes Therapy Management and Education
Doctors Hospital at Renaissance has recently opened a Center, which filled the Overlook at the Rim (145,000 SF)
major addition, which includes a new Medical Tower with property. Citing San Antonio’s affordable office costs,
an expanded Emergency Department, a new Pediatric ample workforce and inland location away from the threat of
Intensive Care Unit and Pediatric Oncology Services. 495 damaging hurricanes, Whataburger Restaurants LP relocated
Commerce Center became home to its second GSA building to 300 Concord Plaza (141,000 SF) after petroleum refiner
Economic Overview (four-story, 150,000 SF) which opened in Q1 2009. Economic Overview Tesoro Companies expanded into its new 618,000 SF
2009 With the opening of the newest international bridge in 2009 headquarters facility at Ridgewood Park.
Population 1,196,001 January 2010, the industrial market will regain momentum. Looking ahead, IHS Global Insight predicted that San Antonio
The presence of maquiladoras provides considerable 2014 Estimated will be one of the first cities to lead the way out of the
2014 Estimated
Population 1,237,256 advantages to the economic environment along the border Population 2,325,643 recession and regain the pre-recession job levels in 2010.
by increasing trade, generating employment and acquiring Commercial real estate is expected to trail that recovery path
Employment local resources; all important stimuli to the economy in the Employment
904,793
with improvement anticipated in 2011.
South Texas area.
Household Household
Median Median

34
McAllenMission At A Glance San Antonio At A Glance

New Construction (AAA) $ 12.00 $ 25.00 $ 24.50 70.0% Premium (AAA) $ 22.00 $ 24.00 $ 23.00 15.4%
RETAIL RETAIL
Community Power Center $ 15.00 $ 32.00 $ 31.00 15.0% Sub Regional Centers $ 17.00 $ 40.00 $ 23.97 10.1%
Regional Malls $ 30.00 $ 100.00 $ 80.00 4.0% Regional Malls $ 25.00 $ 60.00 N/A 10.4%


Texarkana (Bowie County, Texas/Miller County, Arkansas), Texas Salt Lake City, Utah
Forbes Magazine predicted Texarkana to be ranked number Salt Lake City is a vibrant, pro-business community with a
two in the US for the fastest growing SMSA in the under highly educated populace and an entrepreneurial spirit that
500,000 category, with a 28.57% increase in gross metro- is consistently rated among the best cities for business.
politan product over the next five years. Transportation, Healthcare, technology and education remain the primary
medical, industrial and residential growth continues with an drivers of the local economy. Unemployment is a relatively
increased vacancy rate in the retail sector. low 6.1% compared to the national average. Salt Lake City
The medical office sector has experienced moderate growth continues to outperform the nation as a whole and remains
as Texarkana continues to be the regional center for the one of the soundest economies in the US.
surrounding 60-mile area. The purchase of Wadley Regional The commercial real estate industry in the Salt Lake City
Hospital by Brim Heathcare insures robust competition and metropolitan market trended downward in 2009 in response
growth in the industry. to the changing economic conditions. The total office market
The industrial base for the market is diverse, with two paper inventory is 31.5 million SF, one-third of which lies in the
mills, Cooper Tire and Red River Army Depot the leading downtown submarket. Direct vacancy in the overall market
employers. The Depot is expected to transfer several thou- increased to 13.6%; vacancy downtown is 5.8% and 17.8%
sand acres with buildings and infrastructure to Red River in the suburban submarkets. Class A full service rental rates
Redevelopment Authority in the near future. Construction have dipped to an average of $25/SF for product downtown
Contact Contact and an average of $22/SF for office space in the suburban
is under way for a new clean burning coal power plant,
NAI American Realty Co. NAI Utah Commercial submarkets. While leasing activity is down compared to
resulting in 1,000 construction jobs, and a new cement
+1 903 793 2666 Real Estate (Salt Lake) 2008, it has improved steadily through the year.
plant is in progress. Alumax Aluminum mill closed, but
+1 801 578 5555
Cooper Tire expanded in Texarkana after closing its Anniston, Salt Lake City is a key distribution hub with over 109 million
Alabama, plant. SF of industrial space. Total availability in the industrial
Texarkana continued to experience reduced growth in the market reached 9% this year after bottoming at 4% in late
retail sector in 2009. However, Lafferty’s Appliance, Osaka 2007. Lease rates have declined 7% since late 2008 and
Japanese Restaurant, and Minton’s Sportsplex all opened, average at $.40/SF NNN per month. While leasing activity
providing a bright spot for this market. Central Mall has has leveled off this year, a 470,000 SF distribution
added several small shops and maintains a high occupancy warehouse was sold midyear. The retail market has just
rate. Recent hotel openings include Holiday Inn Express, under 37 million SF of leasable space. Vacancy in the overall
Metropolitan Area Metropolitan Area market stands at 6%. Rates have dipped to $15/SF NNN in
Best Western, Fairfield and Candlewood Suites with a
Economic Overview Economic Overview the CBD.
Holiday Inn, Country Host, Crown Plaza and Sleep Inn,
2009 scheduled to open soon. A new convention center, hotel and 2009 Salt Lake City’s largest project is the City Creek Center
Population 134,117 restaurant are planned on the Arkansas side of Texarkana Population 1,163,845 mixed-use redevelopment in the CBD. The 20-acre develop-
We anticipate additional retail, hospitality and restaurant ment includes 1.5 million SF of office space, 800,000 SF of
Population 133,365 growth in this area. Texas A&M University has completed Population 1,324,171
retail space, 700 residential units and large swaths of open
construction of a new science and technology building and spaces. The development is scheduled for completion in
Employment
construction has begun on a new 183,000 SF library building Employment 2012.
that is a part of the 375-acre 1.4 million SF University.
Household Household
Median Median

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

Bulk Warehouse $ 2.00 $ 3.50 $ 2.25 15.0% Bulk Warehouse $ 2.88 $ 6.00 $ 4.20 N/A
Manufacturing $ 2.50 $ 4.50 $ 2.75 20.0% Manufacturing $ 3.00 $ 12.96 $ 5.40 N/A
High Tech/R&D $ 13.00 $ 16.00 $ 14.50 0.0% High Tech/R&D $ 2.88 $ 16.08 $ 6.72 N/A
RETAIL RETAIL
Sub Regional Centers $ 7.00 $ 18.00 $ 12.50 10.0% Community Power Center $ 15.77 $ 30.53 $ 23.77 N/A
Regional Malls $ 6.00 N/A $ 18.50 8.0% Regional Malls $ 28.50 $ 37.20 $ 32.85 N/A


Washington County, Utah Burlington, Vermont
Southern Utah has seen its housing market begin the The Greater Burlington commercial real estate market saw
recovery process and prices are expected to increase slightly limited growth in 2009. 2010 looks to be a similar year with
in 2010. Historically, housing has been a very important below average growth anticipated in the retail, office and
sector in the local economy. The increasing stability in the industrial sectors. Each of these market segments should
housing market, along with the local economic development see lease rates weaken. The number of lease transactions
office's efforts to diversify the economy, is a sign that our has also declined over the past five years.
aggressive historical growth trends are not far behind. Retail growth in 2010 is expected to be around 3.6%.
The economy has had the greatest impact on the industrial Vacancy in the suburban markets has risen slightly, while
market. While net absorption has been negative for two vacancy in the CBD remains stable. In the CBD, lease rates
consecutive years, we have seen an increase in the number are $18-$30/SF, with the highest rates seen in the Church
of transactions relative to Q1 and Q2 of 2009. The vast Street Marketplace and Burlington Town Center. Average
majority of new leases are for small space with short-term suburban retail lease rates are between $8 and $13/SF. New
leases and low rates. Although new business leasing was office development in 2010 is anticipated to be about 1.4%.
not sufficient enough to outpace business contraction in There has been a weakening in the suburban office market
2009, we expect to see positive absorption in 2010. while the CBD remains stable. Vacancy rates for office space
Contact Leasing activity and demand in the office market is also Contact in Chittenden County are 12.4%. Suburban vacancy rates
improving. Although it was just a slight increase, we did see are closer to 14.7%. The CBD has the lowest vacancy
NAI Utah Southern NAI J.L. Davis Realty
positive absorption in the office market in Q3 2009. This coming in at 4%. Lease rates for Class A office space in the
Region +1 802 878 9000
improvement was driven by softening lease rates and CBD range from $13-$17/SF and are stable. Class B space
+1 435 628 1609
business growth. We expect office leasing to remain soft in this district rents for $8-$13/SF and is also stable.
into 2010 with tenants asking for aggressive rates and Industrial growth in 2010 is projected at 2.2%. Vacancy
additional concessions. Most of the leasing activity will rates have risen to 9% in 2009. Rents are expected to
continue to come from business relocations, although we weaken for all classes of industrial space. Above average
do expect an increase in the number of new businesses property is leasing for $6-$8/SF, average industrial property
entering the market. rents for $4.50-$6/SF, and below average property leases
Locally, retail continues to be Southern Utah’s most active at $3-$4.50/SF. In general, large industrial properties
Metropolitan Area market, although retailers are still struggling and vacancy Metropolitan Area are leasing for $3.50-$5.00/SF depending on condition
rates are still rising. Most of the interest in the retail market and location.
is in high exposure locations. While actual retail rents have Overall, 2010 should produce many opportunities for busi-
2009 decreased, it has not been to the degree seen in the office 2009
nesses of all sizes. As the economy tries to stabilize,
Population 148,274 and industrial markets. Population 208,401
development moves forward with new leasing opportunities
2014 Estimated NAI Utah Southern Region is the largest commercial real 2014 Estimated for the office, retail, and industrial markets.
Population 184,260 estate brokerage in Southern Utah as measured by agents, Population 210,825
leasing volume and sales volume. We also offer property
management services. 121,812
Household Household
Median Median

30.2 38
Washington County At A Glance Burlington At A Glance

Premium (AAA) N/A N/A $ 1.15 35.0% New Construction (AAA) N/A N/A N/A N/A
New Construction (AAA) N/A N/A N/A 35.0% New Construction (AAA) $ 15.00 $ 22.00 $ 18.50 14.0%
RETAIL RETAIL
Neighborhood Service Centers N/A N/A N/A N/A Neighborhood Service Centers $ 10.00 $ 16.00 $ 13.00 7.8%
Sub Regional Centers N/A N/A N/A N/A Community Power Center $ 18.00 $ 22.00 $ 20.00 7.0%

Office in CBD $ 350,000.00 $ 600,000.00 Office in CBD $ 15.00 $ 28.00

Northern Virginia Seattle/Puget Sound, Washington
The Northern Virginia office market experienced an increase The Seattle/Puget Sound region has suffered major job
in vacancy rates matched by a drop in the average asking losses since the national recession finally hit the local market
rental rate. The amount of available space in Northern during the summer of 2009. Vacancies have almost doubled
Virginia is on the rise as many tenants remain conservative. in office, industrial and retail sectors compared to the low
This trend has resulted in ample opportunities for companies averages the region enjoyed in previous years. Vacancy is
in decent financial position to take advantage of landlords expected to peak around mid-year 2010. Microsoft and
who are offering generous incentives, or to acquire space Boeing have had minimal layoffs as compared to other large
that has already been built-out to a high standard. corporations and both continue to be anchors of stability for
Many companies have been inclined to shed jobs or consol- the region.
idate their office requirements in order to cut expenses, Regional Puget Sound office vacancy rates are at 13% and
leading to a decrease in Northern Virginia’s overall demand are expected to rise to over 20% during 2010. Downtown
for office space. In coordination with diminished demand, Seattle has 3.5 million SF of new product scheduled to hit
vacancy rates in Northern Virginia continued to rise. At the the market in 2010. This fact alone will keep the rates
close of 2009, 13 buildings were under construction in depressed in Seattle, while downtown Bellevue will enjoy
Northern Virginia for a total of 3.67 million SF, of which 67% lower vacancy due to the dominating presence of Microsoft
was pre-leased. and little new spec product expected on the market.
Contact Contact
The Army, in conjunction with Duke Realty, broke ground on The Puget Sound industrial market has suffered due to
NAI KLNB NAI Puget Sound
the Mark Center Office Park, a 1.7 million SF office complex decreased container traffic at the ports of Seattle and
+1 571 382 2100 Properties
in the I-395 submarket. The project is being developed to Tacoma. Home construction and related industries contribute
+1 425 586 5600
house Department of Defense personnel and is scheduled to the total vacancy which averages over 8% in the region.
to be completed by the September 2011 Base Realignment Bright spots in demand have been growth in aerospace
and Closure (BRAC) deadline. The JBG Companies broke production and warehousing of consumer goods. Occupancy
ground on a 144,000 SF office building, located at 900 N is expected to begin to increase early in 2010 starting in the
Glebe Road in the Ballston submarket. The building is 100% huge Kent Valley market.
leased to the Virginia Tech Research Institute, which will The retail sector has been hit by the downturn in the
receive ownership upon completion of the structure. Declining economy. However, the overall vacancy hovers at 7%.
office demand and the frozen credit markets have caused Vacancy is expected to increase slightly during the first half
Metropolitan Area developers to delay new construction projects unless there Metropolitan Area
of 2010 and then stabilize. Most vacancy is attributed to big
Economic Overview is a significant portion of pre-leasing activity. Economic Overview
box stores who have vacated their facilities. Some retailers
2009 Northern Virginia can be broken down into two noticeably 2009 are taking advantage of the favorable leasing conditions and
Population 2,197,406 different scenarios: inside the beltway and outside the Population 3,398,053 expanding market share.
Beltway. Recovery momentum is expected to continue in The investment market has been painfully slow due to the
submarkets inside the Beltway close to Washington, DC, Population 3,617,098 lack of available financing. We expect conditions to gradually
where rental rates have held steady. improve during the year. Investors with cash and the ability
Even with limited new office supply over the past year and Population 1,711,309 to act quickly will be able to pick up assets well below
support from the stimulus package and increased federal replacement costs.
Household budget, the region is struggling, but poised, to recover much Household
Multifamily continues to be the most solid sector of the
Average Income $123,675 more quickly than other parts of the country. Average Income $83,654
market. Capitalization rates are 6-8% and rent rates are
Median Median expected to begin rising by mid year. Signs of recovery are
Household Income $93,243 Household Income $65,472 evident across the region and opportunities exist for tenants
and smart investors.
38
Northern Virginia At A Glance Seattle/Puget Sound At A Glance

Bulk Warehouse $ 6.00 $1 8.00 $ 9.00 12.0% Bulk Warehouse $ 3.70 $ 5.10 $ 3.85 8.0%
RETAIL RETAIL
Neighborhood Service Centers $ 20.00 $ 50.00 $ 35.00 N/A Neighborhood Service Centers $ 14.00 $ 32.00 $ 23.00 9.2%
Community Power Center $ 16.00 $ 20.00 $ 19.00 N/A Sub Regional Centers $ 21.00 $ 38.00 $ 27.00 5.0%

Office in CBD N/A N/A Office in CBD $ 6,000,000.00 $15,000,000.00
Residential N/A N/A Residential $ 210,000.00 $ 1,400,000.00

Spokane, Washington TriCities, Washington
The most significant change in the Spokane market is the The Tri-Cities is located in southeastern Washington and is
dramatic decrease in investment sales. Apartment building composed of Richland, Kennewick, Pasco and numerous sur-
sales totaled $70 million in 2008 but 2009 sales are antic- rounding rural communities. Easily accessible, the area is the
ipated around $10 million. Apartment vacancy rates remain service and occupational hub in the region. The economy is
low at 5.58%, but the lack of available financing has greatly fueled by government contracted projects for environmental
reduced activity in that sector. Additionally, there have clean-up, scientific research and development, agriculture
been few sales of retail, office and industrial properties to and healthcare.
investors. Those properties that have been sold have traded In 2009 the medical industry topped the list of sectors in
at capitalization rates from 9-11%. the Tri-Cities that remained strong. Contributing to the trend
Spokane office leasing has remained steady with many was Kadlec Regional Medical Center, which opened three
major companies taking advantage of attractive rent and 20,000 SF office buildings designed to house hospital-
tenant improvement packages. The Principal Financial Group owned physician practices. Pacific Northwest National Lab
leased 35,000 SF in the Riverview Corporate Center at followed the development trend with continued construction
Sullivan Road, relocating from the Rock Pointe Corporate of 300,000 SF of additional lab and professional space at its
Center. Shell Energy relocated and expanded to the Wells north Richland campus. Manufacturing and warehouse
Fargo Bank Building taking 10,000 SF, and Western States property remained constant as well, although this was driven
Contact Insurance Company upgraded to 9,000 SF in the Riverpoint Contact more by limited inventory rather than a response to a new
NAI Black Office Building. NAI Tri-Cities insurgence of business.
+1 509 623 1000 +1 509 943 5200
The Spokane office market experienced an increase in On the down trend was demand for office and retail space
vacancy from 10.94% in 2008 to 12.68% in 2009. as national chains and local businesses felt the crunch of
Spokane's medical office market is one bright spot in the the economic recession. Given this down trend rental rates
market. 2009 has seen a steady demand for office space for office space fell markedly while vacancy rates increased
by growing medical and dental specialist practices. This to 10% for Class B office space, the bulk of available office
demand has generated new owner occupied medical office space in the region. Retail space also struggled with higher
construction and a reduction in the medical office vacancy than normal vacancies, especially in newer neighborhood
rate from 7.49% to 7.23%. power centers.
Metropolitan Area
National retailers have greatly reduced their plans for new Metropolitan Area Large commercial construction projects this year have been
store openings in the region. There has been some activity single facility projects such as the new headquarters for
in the retail leasing market limited mostly to local retailers. Gesa Credit Union. While interest in further development
2009 The downtown CBD remains a vibrant shopping district with 2009 has been strong growth has been slow as a result of the
Population 474,627 a slight decrease in retail sales. The industrial market has Population 234,721 challenges faced by contractors at loan origination. There-
stabilized and become fairly active in the second half of fore, much of the development this year has focused on
520,228
2009. Spokane's industrial vacancy increased slightly from Population 248,878 tenant improvements and the filling of existing commercial
Population
8.51% to 8.82% with rental rates remaining unchanged. properties.
Employment With the lack of any new construction anticipated in the next Employment
2010 predictions are brighter as Cascade Natural Gas and
Population 233,916 year, vacancy rates should decrease with rents increasing Population 89,082
Kennewick General Hospital anticipate breaking ground on
in 2010. Household their new facilities. Other growth, tied to local lending,
Household
Average Income $61,434 The overall economic climate in Spokane remains relatively Average Income $64,124 appears to be positive for developers. With unemployment
stable. There will continue to be some distressed sellers at 6% and home values currently up 8.9% over the past
Median Median
in the market due to the economy, creating buying opportu- Household Income $59,323 three years, 2010 looks strong.
nities for owner users or investors with cash. Time will
Total Population continue to stabilize and improve the overall commercial real Total Population
37 Median Age 33
Median Age estate market.
Spokane At A Glance TriCities At A Glance

Class B (Secondary) $ 14.00 $ 17.50 $ 15.60 19.2% Class B (Secondary) $ 9.00 $ 12.00 $ 10.50 10.%
RETAIL RETAIL
Community Power Center $ 6.00 $ 26.00 $ 18.00 8.9% Sub Regional Centers $ 15.00 $ 20.00 $ 17.50 10.0%

Office in CBD $ 65.00 $ 100.00 Office in CBD N/A N/A

Madison, Wisconsin Milwaukee, Wisconsin
Historically, the state government and the University of Transaction volume and aggregate value are down in all
Wisconsin-Madison have been the key drivers to the local market sectors, further qualifying the fact that 2009 was
economy and 2009 was no exception. These two economic the year of the smaller deal. As the nation’s economy slowly
drivers are the insulating factors that allow Madison’s starts to rebound, there is no better time to be a tenant,
economy to maintain a relatively stable outlook in spite of assuming your business is relatively stable. Slowly is the key
the national economic downturn. Madison was ranked the word as we enter 2010.
seventh best city in the country by Kiplinger’s Personal Rental rates in the office market are down 20-25% and
Finance in July 2009. absorption is heavily negative with vacancy climbing to
The 2009 industrial vacancy rate was 6.1%, the same as 18.5%. Tenants with lease expirations two to three years out
2008. The total industrial inventory includes 1,071 buildings can realize dramatic savings by systematically renegotiating
that encompass almost 43.5 million SF. The average rental their leases through blend and extend transactions.
rate for industrial space is $4.51/SF NNN. The industrial market has seen an increase in lease activity
Though downtown retail space remains in high demand, yet square footage requirements have decreased. Rental
overall retail vacancy has risen to 8.2%. In an effort to rates and vacancy rates in Milwaukee have remained
improve leasing activity, owners of neighborhood/community relatively stable with landlords requiring at or near asking
Contact centers are turning to non-traditional tenants and increasing Contact rates while giving concessions on tenant improvements or
up-front concessions. Development activity remains isolated, rent abatement. Larger transactions are stewing, but may not
NAI MLG Commercial NAI MLG Commercial
however Target continues to pursue a Hilldale Mall location occur until Q1 2010. Many companies are towing-the-line to
+1 608 663 6000 +1 262 797 9400
on the site of a stalled Whole Foods project. attain minimal profit.
(Brookefield)
Commercial investment capitalization rates have shifted +1 414 347 9400 Wisconsin lost large employers like General Motors and
from 7%-8% to 9%-11%. The multifamily rental market has (Milwaukee) other large employers, like Harley Davidson, have drastically
increased capitalization rates from 6%-7% to 8%-9%. reduced their workforce. Cyclical effects are being felt by all
Developers are holding the line on commercial leasing, while sectors as a result.
others are decreasing asking rents and negatively impacting The retail market saw minimal growth in 2009. The three
NOIs in the marketplace. largest retail developments were the Shoppes on Sunset in
Hotel development continues and a proposed $109 million Waukesha, anchored by Target and Pick 'n Save; a new Pick
Metropolitan Area Edgewater Hotel is the largest redevelopment in years. The Metropolitan Area ‘n Save in Wauwatosa; and Prairie Ridge Shops in Pleasant
Economic Overview average hotel occupancy rate is 51.9% and the average Economic Overview Prairie, anchored by Target, JC Penny and Dick's Sporting
nightly room rate is $85/night. Goods. Tertiary markets saw a slight increase in vacancy as
2009 2009
Madison’s office market has been facing significant retailers pulled back expansion, and slower sales caused
challenges. Overall vacancy rate is roughly 13.8%. Net some doors to close. Market rents dropped slightly as ten-
2014 Estimated absorption for Q3 2009 was a negative 765 SF. Gross 2014 Estimated ants gained power over landlords eager to fill vacant space.
asking lease rates average between $16.60 -$16.80/SF. New retailers in the market included Erewhon, Dave &
Employment Office building sales amounted to only seven transactions at Employment Buster’s and Gold’s Gym. Many local and regional grocers
Population 450,515 the end of Q3 2009. Population 1,097,412 such as Pick ‘n Save, Sendik’s, and Woodman’s (250,000
The office, retail and industrial landlord’s ability to achieve SF) will continue to expand in 2010. Expect vacancies to
Household Household increase and effective market rents to drop until the market
Average Income $74,890 a healthy occupancy level in an already over built market Average Income $67,676
and developers’ ability to secure financing for key projects levels out.
Median will both be significant factors in 2010. Median

36 38
Madison At A Glance Milwaukee At A Glance

RETAIL RETAIL

Office in CBD $ 711,700.00 $ 1,627,058.00 Office in CBD N/A N/A

Northeastern (Fox Valley/Green Bay), Wisconsin Casper, Wyoming
Northeastern Wisconsin felt the effect of the economic Casper has the amenities of a metro area with the conven-
downturn in mid-2008 and through all of 2009, but the ience and accessibility of a smaller community. With 75,000
market can best be characterized as stable going into 2010. people in Natrona County, the Casper area is the largest
The office and retail sectors experienced little change in MSA in Wyoming and supports a vibrant economy. Casper
vacancy rates in 2009. Overall vacancy for industrial is 15- cradles a broad industry base built around natural resources
18% and expanding to manufacturers who desire low overhead
The office, industrial and retail sectors have all experienced with a central western presence.
reduced rental rates on leases as landlords have been Industrial space rents range from $5 to $12/SF gross and
receptive to downward adjustments in rents in return for lock- there is supply of about 4 million SF of rentable area and a
ing in credit-worthy tenants for longer terms. It is widely felt vacancy rate of less than 5%. Office rents are $10 to
that companies appear to be past the large job reductions $20/SF gross with a supply of about 2 million SF and a
and plant closings that began in 2008, and recent economic vacancy rate of around 10%. Retail space is priced from
indicators have renewed hope that the performance of $12-$25/SF gross with a supply of about 2.25 million SF
companies is improving and plans for expansion that had and a vacancy rate of 12% due to a couple of recent big
been placed on hold may soon move forward again. Em- box vacancies (Office Depot and Rex's).
ployers and their lenders are cautiously moving into a period There has been heavy retail and office development on the
Contact of hopeful stability. Contact
east side of Casper, including a 600,000 SF regional mall,
NAI MLG Commercial NAI Luker
With many landlords concerned about their debt maturities a Wal-Mart super center (there is also a newer west side
+1 920 997 9990 +1 307 265 8000
and loan-to-value ratios, the traditional thinking of maintain- Wal-Mart super center), Home Depot, Menards, five national
ing building valuations has been thrown out the window. hotels, car dealers, and 500,000 SF of office/medical
Many building valuations are upside down. As a result, campuses. Continued industrial demand has driven devel-
landlords will not be able to sell their buildings for a profit for opment to the north and west.
quite some time. As a result, landlords are seeking to firm A 700-acre development is currently under way with rail
up their cash flow to service debt and pay returns. spur access through Burlington Northern and in close
Municipalities continue to hold off on expansion of industrial proximity to Natrona County International Airport, which
land holdings, as the current supply of existing sites appears is ideal for manufacturing and distribution. Drilling and oil
Metropolitan Area to be more than adequate to meet demand over the next Metropolitan Area service companies have continued showing strong demand
several years. Hence, vacancy rates are expected to remain in the region.
Economic Overview stable with no speculative development under way or planned. Economic Overview
Casper’s location facilitates access to worldwide markets
2009 Overall, transactions in 2009 were down throughout all 2009 through Wyoming’s only international airport, routes along
market sectors, both on the number of transactions and I-25 and rail routes. Casper is a regional medical, finance
2014 Estimated transaction value. Vacancy rates are expected to remain 2014 Estimated and retail hub with a trade area encompassing central
Population 1,106,993 stable and may even be reduced as we enter 2010. Population 78,171 Wyoming. Companies are opening new facilities, while
established industries expand, creating jobs, infusing capital
310,990 44,612
and solidifying investment.
Household Household
Median Median
Total Population Total Population 35

39
Northeastern (Fox Valley/Green Bay), Wisconsin At A Glance Northeastern (Fox Valley/Green Bay), Wisconsin 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
Contact relaxing, scenic float. The three ski resorts in the county,
Jackson Hole Mountain Resort, Grand Targhee Resort and
NAI Jackson Hole
Snow King Resort, delight visitors 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 US and from Canada to Mexico. US energy
Metropolitan Area independence depends heavily on western Wyoming.
The area is the focus of extensive exploration and oil field
Economic Overview
development and has one of the largest natural gas
2009 reserves in the world.
Population 29,907
The world's largest known supply of oil shale is the Green
2014 Estimated River deposit in Southwestern Wyoming. Wyoming also has
Population 33,945 the nation's largest supply of coal, and is one of the top four
states in green job growth, including wind technology.
Employment
Population 15,094
Household
Median
Total Population
Median Age 37.8
Jackson Hole At A Glance

(Rent/SF/YR) Low High Effective Avg. Vacancy
DOWNTOWN OFFICE
New Construction (AAA) $ 25.00 $ 25.00 $ 25.00 N/A
Class A (Prime) $ 30.00 $ 35.00 $ 32.50 N/A
Class B (Secondary) $ 15.00 $ 19.00 $ 17.00 N/A
SUBURBAN OFFICE
New Construction (AAA) $ 20.00 $ 20.00 $ 20.00 N/A
Class A (Prime) $ 20.00 $ 25.00 $ 22.50 N/A
Class B (Secondary) $ 17.00 $ 22.00 $ 19.75 N/A
INDUSTRIAL
Bulk Warehouse N/A N/A N/A N/A
Manufacturing N/A N/A N/A N/A
High Tech/R&D N/A N/A N/A N/A
RETAIL
Downtown $ 25.00 $ 32.00 $ 28.50 N/A
Neighborhood Service Centers N/A N/A N/A N/A
Regional Malls N/A N/A N/A N/A
DEVELOPMENT LAND Low/Acre High/Acre

Land in Industrial Parks N/A N/A
Office/Industrial Land - Non-park $ 3,000,000.00 $ 6,000,000.00
Retail/Commercial Land $ 3,500,000.00 $ 9,500,000.00
Residential $ 3,000,000.00 $ 3,000,000.00

Glossary

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 Centre) High Tech/R&D (Flex) (Regional Shopping Centres)
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 S.F.; 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 S.M.; 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 Centre) 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 Centre) 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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NAI Global Market Report 2010

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Investment Office Industrial Retail Land

Dear Real Estate Executive:

2010 Global Market Report www.naiglobal.com 2

Dr. Peter Linneman, Chief Economist

© 2009 NAI Global. All rights reserved.

2010 Global Market Report www.naiglobal.com 4

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100 Office Industrial Retail Hotel Multifamily

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Latin America and the Caribbean

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Market Effective Avg. High Rent Vacancy

Long Island, New York $30.00 $40.00 20.0%

Philadelphia, Pennsylvania $27.00 $38.00 18.0%

Retail Market Effective Avg. High Rent Vacancy

the other sectors where there are deals to be made at a price.

Market Effective Avg. High Rent Vacancy

Pittsburgh, Pennsylvania $7.50 $13.00 10.0%

Market Effective Avg. High Rent Vacancy

Long Island, New York $16.00 $18.00 8.5%

Washington, DC $16.00 $18.00 23.0%

2010 Global Market Report www.naiglobal.com 21

Fort Lauderdale, Florida $30.00 $40.00 8.0%

Palm Beach County, Florida $24.63 $35.00 17.5%

construction is non-existent. Fort Lauderdale, Florida $30.00 $40.00 8.0%

Retail Chattanooga, Tennessee $24.00 $30.00 10.0%

Northern Virginia $9.00 $18.00 12.0%

Miami, Florida $7.41 $10.83 10.1%

Palm Beach County, Florida $6.70 $9.50 10.5%

Market Effective Avg. High Rent Vacancy

Orlando, Florida $26.50 $30.00 6.2%

Mobile/Baldwin Counties, Alabama $17.50 $20.00 15.0%

2010 Global Market Report www.naiglobal.com 22

remain filled. Davenport/Bettendorf, Iowa $15.00 $28.00 7.0%

Chicago, Illinois $50.00 $80.00 7.8%

Fargo, North Dakota $5.50 $6.00 9.9%

Cedar Rapids, Iowa $6.50 $10.00 5.0%

Detroit, Michigan $6.50 $8.00 24.0%

Indianapolis, Indiana $16.50 $17.50 13.4%

Canton, Ohio $12.00 $14.00 6.0%

2010 Global Market Report www.naiglobal.com 23

Industrial Market Effective Avg. High Rent Vacancy

McAllen/Mission, Texas $31.00 $32.00 15.0%

Baton Rouge, Louisiana $28.00 $40.00 6.6%

New Orleans, Louisiana $41.25 $62.50 5.0%

Houston, Texas $5.31 $7.14 7.0%

McAllen/Mission, Texas $9.75 $11.00 6.0%

Beaumont, TX $6.30 $7.00 6.0%

Market Effective Avg. High Rent Vacancy

Texarkana $14.50 $16.00 0.0%

New Orleans, Louisiana $12.00 $15.00 10.0%

2010 Global Market Report www.naiglobal.com 24