Sample Retail Asset Advisor

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Sample Retail Asset Advisor

  1. 1. 11201 US Highway One North Palm Beach, FL 33408
  2. 2. Contents 3 Reis Observer Metro Analysis Section 1 - Current Metro Rent Details 13 Section 2 - Nonanchor Rent Growth Comparisons 13 Section 3 - Current Metro Rent Details 14 Section 4 - Nonanchor Rent Growth Comparisons 14 Section 5 - Current Metro Vacancy Details 15 Section 6 - Vacancy Rate Comparisons 15 Section 7 - Current Metro Vacancy Details 16 Section 8 - Vacancy Rate Comparisons 16 Section 9 - Nonanchor Rent Growth Comparisons and Forecast 17 Section 10 - Vacancy Rate Comparisons and Forecast 17 Section 11 - Metro Inventory Detail 18 Section 12 - Inventory Growth Comparison 18 Section 13 - Construction/Absorption Change 19 Section 14 - Construction Deliveries 20 Section 15 - Submarket New Construction Project Tally 20 Section 16 - Metro Inventory Detail 21 Section 17 - Construction/Absorption Change 21 Section 18 - Occupancy at Completion 22 Section 19 - Stabilization Data 22 Section 20 - New Construction Listing 23 Section 21 - Submarket Snapshot 25 Section 22 - Economic and Demographic Trends 26 Section 23 - Metro Area - Palm Beach 27 Section 24 - Metro Data 28 Section 25 - Metro Data 29 Section 26 - Metro Data 30 Submarket Analysis Section 27 - Current Submarket Rent Details 32 Section 28 - Nonanchor Rent Growth Comparisons 32 Section 29 - Current Submarket Rent Details 33 Section 30 - Nonanchor Rent Growth Comparisons 33 Section 31 - Current Submarket Vacancy Details 34 Section 32 - Vacancy Rate Comparisons 34 Section 33 - Current Submarket Vacancy Details 35 Section 34 - Vacancy Rate Comparisons 35 Section 35 - Nonanchor Rent Growth Comparisons and Forecast 36 Section 36 - Vacancy Rate Comparisons and Forecast 36 Section 37 - Submarket Inventory Detail 37 Section 38 - Inventory Growth Comparison 37 Section 39 - Construction/Absorption Change 38 Section 40 - Submarket Data 39 Section 41 - Submarket Data 40 Section 42 - Submarket Data 41 Rent Comps Sales Comparables
  3. 3. Because Reis Observers are narrative reports that present a thoughtful analysis of Reis findings in a given metro, our editorial staff can not begin writing them until the Reis quartely data is released. Therefore the Observers are published on a rolling schedule throughout the quarter and may contain data that predates the rest of this Asset Advisor by one quarter. Reis Observer
  4. 4. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 THE ECONOMY Employment: Like other hard-hit areas of South Florida, upscale Palm Beach County BLS reports a seasonally • must patiently bide its time as the housing-lending downturn runs its unadjusted unemployment rate of course. Home sales and building remain down and employment in the 4.8% in August for the West Palm Beach Metropolitan county’s construction sector is down as well—for the first time in several Division, up from 4.1% a year years. According to data provided by the U.S. Department of Labor, earlier. Bureau of Labor Statistics (BLS), this sector lost 1,100 jobs net over the 12-month period concluding with July 2007. According to the U.S. Moody’s Economy.com reports a • Bureau of the Census, residential building authorizations for the first eight second quarter 2007 average months of the year for the greater Miami area are down 55.2% year over household income of $130,751 year. for the Palm Beach County metro area. Average household While these are serious matters, the slowdown in the Palm Beach County incomes of $112,361 and economy, as a whole to-date, has been less than drastic. Over the 12- $103,273 are reported for the month period ending with July, nonagricultural employment grew at the top metros in the nation and South Atlantic region, rate of 2.5% (adding 14,100 jobs net), a substantial growth rate by any respectively. standard. Concerns expressed earlier in the year by some local observers that regional economies would be in recession by summer 2007 now seem grossly exaggerated. As of late June, The Florida Metro Forecast from the Employment Growth Institute for Economic Competitiveness at the University of Central Florida was predicting a “soft landing” for the state as a whole. Job growth in Palm Beach County, meanwhile, has been particularly strong in 30 6% 25 5% the leisure and hospitality sector, which added 5,400 jobs over the latest Jobs Added (000's) 20 4% Rate of Growth 15 3% July-to-July period for a striking 7.9% gain. Substantial increases were 10 2% achieved as well by the professional and business services, education and 5 1% 0 0% health services, and trade sectors. And waiting in the wings is the -5 -1% -10 -2% biotechnology sector with its bright promises for the future of the Palm 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 Beach economy. Anchoring this sector is Scripps Research Institute and Jobs Added Rate of Growth the new development it is expected to generate. Scripps presently is Source: BLS developing a facility in Jupiter. Employment by Sector: After averaging 2.2% over the five-year period concluding with 2004, population growth has slowed significantly, according to Moody’s Manufacturing Constr, Trans, Education & 3% Economy.com, with the slowdown likely a result of rapid home price Util, Nat. Rsrce Health Svc. 10% escalation. Growth rates in 2005 and 2006, accordingly, were 1.3% and 13% Wholesale 4% 1.6%. Improvement, however, is on the way: this source is projecting a gain Information Government of 2.4% for 2007 (31,000 residents net) with larger gains expected 2% 11% Finance thereafter. 7% Leisure & Hospitality Prof. & 12% Business Svc. Retail Trade & 21% Consumer Svc. 17% Source: BLS 1 Copyright 2007 Reis, Inc. Page 4
  5. 5. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 OUTLOOK It may be 2009 before the housing market rights itself. So far, the Palm Beach County economy has done well in weathering the upset. Over the longer term, the county economy’s significant assets—its diversity, its affluent and well-educated work force, its strong population growth profile, and the promise seen in biotechnology—bode well. 2 Copyright 2007 Reis, Inc. Page 5
  6. 6. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 THE REAL ESTATE MARKET Special Real Estate Factors:: Office: “Developers and • financiers, trying to make sense of OFFICE high purchase prices for premier properties, suspect the deals will The present year, and drive up tenant lease rates to possibly next year as unsustainable heights and make it Palm Beach County Office Supply and Demand Trends well, will challenge the even tougher for smaller investors to buy.” So states CB Richard office market with 2,000 30% Ellis in its third quarter 2007 increasing volumes of 1,500 25% Square Feet (000's) report on the local market. new supply at a time of Vacancy Rate 1,000 20% “Regional investors are exploring slower economic 500 15% cheaper markets or taking on growth. The 608,000 0 10% institutional partners to pave the square feet Reis expects -500 5% way to quicker, cheaper funding.” will deliver this year -1,000 0% Meanwhile, the subprime lending 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 would be the largest troubles have raised borrowing Completed Absorbed Vacancy Rate single-year sum since costs “and tightened the supply of Source: Reis, Inc. 2001. Fortunately for money for even the largest the health of the market, total existing inventory should grow by only investors.” about 400,000 square feet, as some existing spaces depart from the Apartment: “Transaction • market. The near lack of deliveries year-to-date (48,000 square feet) has velocity continues to decelerate due allowed the vacancy rate to slip to 10.3% during second quarter, shedding to the absence of conversion buyers 30 basis points. First Glance reporting from Reis indicates a third quarter and tighter mortgage financing,” vacancy rate of 11.1%. Net absorption for the year is forecast at 283,000 states Marcus & Millichap Real square feet. Reis expects 2008 to present the market with 912,000 square Estate Investment Brokerage feet of new space as development remains active. The firm’s latest Company in a third quarter report forecast expects net absorption to remain close at 852,000 square feet. on the local market. Average cap rates and property prices are At 10.5% asking and 11.5% effective, last year’s rent growth was “difficult to discern” at present due extraordinary. High development costs for new space have been a central to the substantial slowdown. For sales closed over the four-quarter element in rent growth in many of the nation’s markets, especially where, span concluding with the second of as in Palm Beach County, hungry condo developers have pushed up the 2007, Reis reports an average price of land. Second quarter asking and effective rents were reported at capitalization rate and selling price $28.38 psf and $24.46 psf, while third quarter First Glance data show an of 7.1% and $326,713 per unit. asking rent of $28.81 psf. In addition, investment sales at high prices mandate higher lease rates as new owners pass their acquisition costs on Retail: A big and quiet deal. • to tenants. Both Blackstone Group and JP Morgan, for example, have In what the Palm Beach Post been recent buyers of Palm Beach County office properties (see Special described in August as “a hush- Real Estate Factors for more information about current investment hush deal,” Menin Development dynamics in the county market). For its part, CB Richard Ellis reports 1.0 has sold nearly all of its stake in million square feet under construction per the close of third quarter, with the Downtown at the Gardens shopping center to Institutional 3 Copyright 2007 Reis, Inc. Page 6
  7. 7. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 most of the space underway in the West Palm Beach and Boca Raton submarkets. Net absorption year-to-date is reckoned by this source at Special Real Estate Factors: negative 198,700 square feet; the net absorption for third quarter was Continued negative 84,000 square feet. The largest for-lease project presently under Mall Investors, a company co- construction is the 296,000-square-foot second phase of CityPlace Tower owned by the California Public in West Palm Beach, for which Reis expects completion in January. The Employees Retirement System 167,000-square-foot Milan at Towncenter is underway in Boca Raton for (CalPERS) and Miller Capital delivery the following month. Advisory Inc. According to local real estate sources, “the center fetched $150 million to $250 CB Richard Ellis reports third quarter vacancy at 11.9%, up from 8.4% four quarters • million, which would make it one earlier. The average asking rent is given as $19.90 psf full-service gross, up 5.1%. of the biggest real estate deals in county history.” For retail properties changing hands over the APARTMENT 12-month span ending at mid- year, Reis reports an average capitalization rate and selling price The condo of 7.5% and $261 psf. Palm Beach County Apartment Supply and Demand Trends conversion trend, 6,000 12% Industrial: “First Industrial • that assisted the 4,000 Realty Trust has snapped up most 10% apartment market 2,000 of the former Palm Beach Park of by supporting its 8% Vacancy Rate No. of Units Commerce in a deal that may 0 occupancy, has 6% jump-start industrial construction -2,000 undergone a 4% in Palm Beach County,” reported -4,000 dramatic reversal South Florida Business Journal in 2% -6,000 due to oversupply June. “The bellwether deal… -8,000 0% in the condo gives the Chicago-based real estate 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 sector. According developer control of 537 acres Completed Absorbed Vacancy Rate Source: Reis, Inc. to Reis, net re- along the Beeline Highway in the northwestern reaches of the conversion during the final quarter of last year returned 1,248 units to the county.” “First Industrial plans rental sector. Accordingly, apartment supply increased by 2,094 units to come out of the ground later this during the last half of last year (new construction of 846 units plus the re- year with speculative distribution converted units). With this, the rapid decrease in vacancy and strong rent warehouses and other light growth established during the preceding period come to an end. Further, industrial facilities for lease a slowdown in rental development and zero net conversions to-date in although the final plan is still 2007 have been of little help. being hammered out,” adds the report. While terms of the sale Second quarter vacancy was 7.0%, up 50 basis points from the end of last were not disclosed, sources report year and on its way to 7.3% by the end of 2007, even as only 110 new that the developer paid about rental units enter the market via new construction (all scheduled for the $162 million, about $7 psf. “With industrial sites further second half). Early reporting from Reis shows a third quarter rate of south trading in the teens, the price 7.3%. After slowing significantly during the last half of last year, rent is a value. The acquisition is part growth fell negative during second quarter 2007, as losses of 0.5% for 4 Copyright 2007 Reis, Inc. Page 7
  8. 8. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 both asking and effective averages dropped these rates to $1,110 and $1,049 per month. Growth rates for the year are forecast at 2.0% for both Special Real Estate Factors: rent categories, well off the respective increases of 5.6% and 5.9% Continued recorded for 2006. First Glance reporting from Reis shows a third quarter asking rent of $1,111 per month. of a $1 billion joint-venture fund with the California State Competition from the heavy condo supply and, to a lesser extent, slower Teachers' Retirement System.” job and population growth, are the chief causes of these trends. Indeed, condo projects continue to dominate Reis’s accounting of multifamily construction recently completed, under construction, planned and proposed. Fortunately, rental construction will remain subdued. With annual volumes increasing year by year, the few units forecast to deliver in 2007 will be followed by an annual average of only 675 units through the remainder of Reis’s five-year forecast period. Among significant projects underway as of mid-year is the 356-unit 500 Ocean Plaza condos in Boynton Beach, for which Reis cites an October completion date. Also in Boynton Beach, the 300-unit Monterey Bay townhomes complex is due on line in November 2008. As recently as August, GlobeSt.com reported the closing of a $137 million construction loan for a 52-unit condo project in Boca Raton. A spring 2009 completion is planned. Prices will range from $2.75 million to more than $15 million. Presales have been “significant,” states the report. Marcus & Millichap reports third quarter 2007 Palm Beach County apartment • vacancy at 7.0%, up a full 170 basis points from a quarter earlier and up 220 over 12 months. The third quarter asking average rent is put at $1,119 per month, up 1.9% from a year earlier. The effective mean grew by 1.2% over the same period to close the quarter at $1,058. 5 Copyright 2007 Reis, Inc. Page 8
  9. 9. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 RETAIL With its high incomes, Palm Beach County Retail Supply and Demand Trends strong population 1000 16% growth and strong 14% 800 economic prospects, Square Feet (000's) 12% Vacancy Rate 600 Palm Beach County 10% 400 8% remains fertile ground 6% for retailers and retail 200 4% real estate. While a 0 2% mild excess of space -200 0% delivered over space 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 absorbed this year will Completed Absorbed Vacancy Rate Source: Reis, Inc. result in a small increase in the vacancy rate for community and neighborhood center space, the level stays low. According to Reis’s forecast, 562,000 square feet will complete construction; 399,000 square feet will be absorbed. Reis puts second quarter vacancy at 5.0%, same as a quarter earlier, up 40 basis points since year end. An additional increase, but only to 5.2%, is projected for year-end 2007; while preliminary data from Reis indicate a rate of 5.7% for the third quarter. The power center market is tighter still. Reis reports 350,000 square feet under construction, all in the West Boca Commons project in Boca Raton due on line in October 2008. Another 475,000 square feet of additional power center space are planned. Power center vacancy at mid-year was 2.8%, up from 1.6% a year earlier. Other significant projects underway include the 400,000-square-foot retail portion of the mixed-use Boynton Town Center in Boynton Beach, due on line next June. “With its exploding population base,” reports CB Richard Ellis, “more retail product is expected to come on line in late 2007 or early 2008 to meet the demand of rapidly expanding communities.” This source reports 1.0 million square feet under construction at the close of second quarter— the largest shares, 411,000 and 389,000 square feet respectively, belonging to the Wellington-Royal Palm Beach and Boynton Beach-Lantana submarkets. Marcus & Millichap expects 1.5 million square feet to complete construction this year, down from more than 2.0 million in 2006. Asking and effective lease rates for community and neighborhood center space increased 7.9% and 7.7% last year, Reis reports. Respective gains of 4.8% and 4.4% are projected for 2007. Second quarter averages were $22.57 and $20.52 psf, each up 0.5% from a quarter earlier. Early 6 Copyright 2007 Reis, Inc. Page 9
  10. 10. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 reporting from Reis shows an asking rent rate of $22.68 psf for third quarter. The second quarter mean rate for power center space was $21.76, up 5.9% year-over-year. CB Richard Ellis reports overall second quarter retail vacancy at 4.01%, up from • 3.11% a year earlier. The average triple-net lease rate is given as $22.78 psf, up from $21.54. INDUSTRIAL High-rent district. Palm Beach County Industrial Supply and Demand Trends With high-tech and biotech industry 1,400 12% 1,200 playing significant 10% Square Feet (000's) 1,000 Vacancy Rate roles in the local 8% 800 economy, the Palm 600 6% 400 Beach County 4% 200 industrial market 2% 0 offers a somewhat -200 0% 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 different profile Completed Absorbed Vacancy Rate than the other Source: Reis, Inc. South Florida markets, with their warehouse/distribution orientations. In addition, its higher land and development costs tend to preclude development of lower-rent properties. Significant increases in construction delivery volumes of multi-tenant, non-manufacturing space in 2006 and 2007 have done, and will do, little to alter that sectors low vacancy profile. The 726,000 square feet that delivered in 2006 were accompanied by demand sufficiently strong enough to chop 60 basis points from the vacancy rate, which closed the year at 5.1%. The delivery of nearly 1 million square feet in 2007, most in a single year since 1986, will be met by strong net absorption at 804,000 square feet. Thus, the vacancy rate will rise, but only as high as 5.5%. A completion total nearly as great next year, moreover, will be surpassed by net absorption, driving the vacancy rate downward once again. By 2011, the final year of Reis’s five-year forecast period, vacancy should be running at 4.5%. Rent growth reflects the market’s tightness and its favorable supply and demand dynamics. Average asking and effective lease rates increased 6.4% and 6.7% last year. Respective increases of 4.3% and 3.9%, producing year-end averages of $6.57 and $6.44 psf, are projected for 2007. 7 Copyright 2007 Reis, Inc. Page 10
  11. 11. Reis Observer Retail - Asset Advisor Reis Observer October 24, 2007 PALM BEACH Metro: Palm Beach Published October 24 2007 According to CB Richard Ellis, the 455,000 square feet that completed construction during third quarter were preleased at 46%. Space remaining underway at quarter’s end is counted at 759,300 square feet, the largest portions of which are found in West Palm Beach and Jupiter, site of the Scripps facility now under development. Construction, notes this source, is underway on land purchased prior to the recent acceleration of land prices that fell upon the entire region. “Demand is intense enough,” notes CB, “that developers are purchasing parcels in Martin and St. Lucie counties “where lower land prices make it feasible to assemble large competitively priced industrial parks.” Meanwhile, First Industrial Realty Trust has purchased a 537-acre site in northwest Palm Beach County with plans for 6.5 million square feet of industrial facilities of all types (see Special Real Estate Factors for more information). Despite the apparent vigor of the market, CB reports year-to-date net absorption at negative 721,300 square feet. With recent increases in operating expenses impacting tenant bottom line, comments this source, “tenants have begun to downsize and consolidate their industrial space requirements.” CB reports third quarter overall vacancy at 6.9%, up more or less steadily through • recent quarters. Rates by property type are given as 6.0% for industrial and 9.1% for flex. Respective average asking rents of $10.92 and $8.45 psf combine to form an average of $9.69. Vacancy Sector 2Q07 2Q06 Chg Office 10.3% 10.1% 20 bps Multifamily 7.0% 4.2% 280 bps Retail 5.0% 4.4% 60 bps Industrial 5.1% 5.7% -60 bps Rents Sector 2Q07 2Q06 Chg Office $28.38 psf $25.77 psf 10.1% Multifamily $1,110 month $1,097 month 1.2% Retail $22.57 psf $21.30 psf 6.0% Industrial $6.30 psf $5.92 psf 6.4% For additional metro and submarket level information on the top 80 markets for the four principal property types, visit www.reis.com or call Reis at: (800) 366-REIS. 8 Unless otherwise indicated, economic and demographic data provided by Moody’s Economy. com Copyright 2007 Reis, Inc. Page 11 Publication Date October 2007 © 2007 Reis, Inc.
  12. 12. Metro Analysis
  13. 13. Retail - Asset Advisor 3rd Quarter 2007 11201 US Highway One North Palm Beach, FL 33408 Metro: Palm Beach Neighborhood Shopping Centers Section 1 - Current Metro Rent Details Nonanchor Asking Rent Nonanchor Asking Rent Distribution Nonanchor Asking Rent Growth Rate Distribution by Age Low 25% Mean Median 75% High Low 25% Mean Median 75% High Year Built Rent Before 1970 $20.49 $12.15 $16.96 $20.98 $20.37 $25.83 $37.52 - 3.3% 0.1% 0.6% 0.3% 2.0% 5.4% 1970-1979 $18.86 42 110 1980-1989 $21.27 38 Number of Properties Number of Properties 37 1990-1999 $25.49 After 1999 $30.75 28 All $20.98 19 As of 09/30/07 41 9 8 7 16 6 6 6 3 0 Under $15.58 $18.83 $22.08 $25.33 $28.58 $31.83 $35.08 Under - 2.6% - 1.3% 0.0% 1.3% 2.6% 3.9% 5.2% $15.57 $18.82 $22.07 $25.32 $28.57 $31.82 $35.07 Over - 2.7% - 1.4% - 0.1% 1.2% 2.5% 3.8% 5.1% Over Negative Growth 22 166 Positive Growth As of 09/30/07 Qtr Ending 09/30/07 Low 25% Mean Median 75% High Anchor Asking Rent Distribution $ 6.69 $10.89 $13.92 $13.57 $16.81 $28.84 As of 09/30/07 Section 2 - Nonanchor Rent Growth Comparisons Asking Rent Growth Quarterly Rent Growth Rate Trends % Quarterly Annualized 2.0 3Q07 2Q07 YTD Avg 1 Year 3 Year 5 Year 1.8 Palm Beach 0.6% 1.1% 1.0% 7.0% 5.3% 4.5% 1.6 1.4 South Atlantic 0.6% 0.6% 0.7% 4.3% 3.8% 3.3% 1.2 United States 0.7% 0.9% 0.8% 4.0% 3.5% 3.2% 1.0 0.8 Average over period ending: 09/30/07 06/30/07 09/30/07 12/31/06 12/31/06 12/31/06 0.6 0.4 Metro Ranks Metro Rank Total 0.2 Compared to: Metros 0.0 3Q07 2Q07 YTD 1 Year 3 Year 5 Year 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 South Atlantic 24 10 4 3 3 3 2 Palm Beach South Atlantic United States 76 35 21 17 7 7 8 US Period ending 09/30/07 Asking Rent Growth Rate Trends % 7.0 6.0 Palm Beach 5.0 4.0 South Atlantic 3.0 US 2.0 1.0 0.0 2002 2003 2004 2005 2006 Period ending 12/31/06 Copyright 2007 Reis, Inc. Page 13
  14. 14. Retail - Asset Advisor 3rd Quarter 2007 11201 US Highway One North Palm Beach, FL 33408 Metro: Palm Beach Community Shopping Centers Section 3 - Current Metro Rent Details Nonanchor Asking Rent Nonanchor Asking Rent Distribution Nonanchor Asking Rent Growth Rate Distribution by Age Low 25% Mean Median 75% High Low 25% Mean Median 75% High Year Built Rent Before 1970 $28.70 $15.01 $20.50 $24.63 $25.73 $31.58 $62.69 - 1.7% 0.2% 0.1% 0.8% 2.1% 14.4% 1970-1979 $23.19 12 30 1980-1989 $26.36 Number of Properties Number of Properties 1990-1999 $30.34 9 After 1999 $39.94 7 16 All $24.63 6 6 6 5 As of 09/30/07 4 5 2 1 1 0 0 Under $15.58 $18.83 $22.08 $25.33 $28.58 $31.83 $35.08 Under - 2.6% - 1.3% 0.0% 1.3% 2.6% 3.9% 5.2% $15.57 $18.82 $22.07 $25.32 $28.57 $31.82 $35.07 Over - 2.7% - 1.4% - 0.1% 1.2% 2.5% 3.8% 5.1% Over Negative Growth 4 51 Positive Growth As of 09/30/07 Qtr Ending 09/30/07 Low 25% Mean Median 75% High Anchor Asking Rent Distribution $ 6.92 $11.88 $16.64 $15.10 $20.62 $26.46 As of 09/30/07 Section 4 - Nonanchor Rent Growth Comparisons Asking Rent Growth Quarterly Rent Growth Rate Trends % Quarterly Annualized 2.2 3Q07 2Q07 YTD Avg 1 Year 3 Year 5 Year 2.0 Palm Beach 0.1% 0.0% 0.6% 8.6% 5.2% 4.9% 1.8 1.6 South Atlantic 0.4% 0.5% 0.6% 4.3% 3.6% 3.1% 1.4 1.2 United States 0.5% 0.7% 0.7% 3.6% 3.2% 2.9% 1.0 Average over period ending: 09/30/07 06/30/07 09/30/07 12/31/06 12/31/06 12/31/06 0.8 0.6 0.4 Metro Ranks Metro Rank Total 0.2 Compared to: Metros 0.0 3Q07 2Q07 YTD 1 Year 3 Year 5 Year 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 South Atlantic 24 17 15 10 1 2 2 Palm Beach South Atlantic United States 76 59 56 32 1 6 4 US Period ending 09/30/07 Asking Rent Growth Rate Trends % 8.0 Palm Beach 6.0 South Atlantic 4.0 US 2.0 0.0 2002 2003 2004 2005 2006 Period ending 12/31/06 Copyright 2007 Reis, Inc. Page 14
  15. 15. Retail - Asset Advisor 3rd Quarter 2007 11201 US Highway One North Palm Beach, FL 33408 Metro: Palm Beach Neighborhood Shopping Centers Section 5 - Current Metro Vacancy Details Vacancy Rate By Age Vacancy Rate Distribution Low 25% Mean Median 75% High Year Built Vac. Rate Before 1970 8.2% 0.0% 0.0% 5.6% 2.4% 7.5% 33.6% 1970-1979 3.9% 107 1980-1989 7.6% Number of Properties 1990-1999 2.3% After 1999 6.4% All 5.6% As of 09/30/07 35 18 9 7 5 4 3 Under 4.0% 7.9% 11.8% 15.7% 19.6% 23.5% 27.4% 3.9% 7.8% 11.7% 15.6% 19.5% 23.4% 27.3% Over As of 09/30/07 Section 6 - Vacancy Rate Comparisons Vacancy Rates Quarterly Vacancy Rates % Quarterly Annualized 3Q07 2Q07 YTD Avg 1 Year 3 Year 5 Year 7.8 7.6 7.4 Palm Beach 5.6% 4.9% 5.1% 5.0% 5.0% 5.4% 7.2 7.0 South Atlantic 7.2% 7.2% 7.2% 6.9% 6.6% 6.8% 6.8 6.6 United States 7.9% 7.8% 7.7% 7.2% 7.0% 7.0% 6.4 6.2 6.0 Average over period ending: 09/30/07 06/30/07 09/30/07 12/31/06 12/31/06 12/31/06 5.8 5.6 5.4 5.2 Metro Ranks Metro Rank Total 5.0 Compared to: Metros 4.8 3Q07 2Q07 YTD 1 Year 3 Year 5 Year 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 South Atlantic 24 5 4 5 5 5 5 Palm Beach South Atlantic United States 76 18 14 17 20 19 20 US Period ending 09/30/07 Vacancy Rate Trends % 7.0 Palm Beach 6.5 South Atlantic 6.0 US 5.5 5.0 2002 2003 2004 2005 2006 Period ending 12/31/06 Copyright 2007 Reis, Inc. Page 15
  16. 16. Retail - Asset Advisor 3rd Quarter 2007 11201 US Highway One North Palm Beach, FL 33408 Metro: Palm Beach Community Shopping Centers Section 7 - Current Metro Vacancy Details Vacancy Rate By Age Vacancy Rate Distribution Low 25% Mean Median 75% High Year Built Vac. Rate Before 1970 12.9% 0.0% 0.9% 5.7% 5.8% 11.2% 31.5% 1970-1979 9.2% 29 1980-1989 8.0% Number of Properties 1990-1999 1.3% After 1999 9.6% All 5.7% 12 As of 09/30/07 5 5 2 1 1 0 Under 4.0% 7.9% 11.8% 15.7% 19.6% 23.5% 27.4% 3.9% 7.8% 11.7% 15.6% 19.5% 23.4% 27.3% Over As of 09/30/07 Section 8 - Vacancy Rate Comparisons Vacancy Rates Quarterly Vacancy Rates % Quarterly Annualized 3Q07 2Q07 YTD Avg 1 Year 3 Year 5 Year 6.8 6.6 6.4 Palm Beach 5.7% 5.2% 5.4% 4.5% 4.5% 5.4% 6.2 6.0 South Atlantic 6.3% 6.3% 6.3% 6.4% 7.1% 7.3% 5.8 5.6 United States 6.9% 6.8% 6.8% 6.7% 7.1% 7.2% 5.4 5.2 Average over period ending: 09/30/07 06/30/07 09/30/07 12/31/06 12/31/06 12/31/06 5.0 4.8 4.6 4.4 Metro Ranks Metro Rank Total 4.2 Compared to: Metros 4.0 3Q07 2Q07 YTD 1 Year 3 Year 5 Year 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 South Atlantic 24 11 9 9 3 2 5 Palm Beach South Atlantic United States 76 30 27 27 16 16 22 US Period ending 09/30/07 Vacancy Rate Trends % 8.0 Palm Beach 7.0 South Atlantic 6.0 US 5.0 4.0 2002 2003 2004 2005 2006 Period ending 12/31/06 Copyright 2007 Reis, Inc. Page 16
  17. 17. Retail - Asset Advisor 3rd Quarter 2007 11201 US Highway One North Palm Beach, FL 33408 Metro: Palm Beach Neighborhood and Community Shopping Centers Section 9 - Nonanchor Rent Growth Comparisons and Forecast Asking Rent Growth Quarterly Annualized 3Q07 2Q07 YTD Avg 1 Year 3 Year 5 Year 5 Yr Forecast Palm Beach 0.5% 0.5% 0.8% 7.9% 5.3% 4.7% 4.2% South Atlantic 0.5% 0.6% 0.7% 4.3% 3.7% 3.2% 3.3% United States 0.6% 0.8% 0.8% 3.8% 3.3% 3.0% 3.4% Average over period ending: 09/30/07 06/30/07 09/30/07 12/31/06 12/31/06 12/31/06 12/31/11 Metro Ranks Metro Rank Total Compared to: Metros 3Q07 2Q07 YTD 1 Year 3 Year 5 Year 5 Yr Forecast South Atlantic 24 12 9 5 1 3 2 1 United States 76 38 34 20 2 5 6 6 Asking Rent Growth Rate Trends and Forecast % 7.0 6.0 Palm Beach 5.0 South Atlantic 4.0 3.0 US 2.0 1.0 0.0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Period ending 12/31/11 Section 10 - Vacancy Rate Comparisons and Forecast Vacancy Rates Quarterly Annualized 3Q07 2Q07 YTD Avg 1 Year 3 Year 5 Year 5 Yr Forecast Palm Beach 5.7% 5.0% 5.2% 4.8% 4.8% 5.4% 5.3% South Atlantic 6.8% 6.8% 6.7% 6.7% 6.9% 7.1% 7.0% United States 7.4% 7.3% 7.3% 7.0% 7.0% 7.1% 7.3% Average over period ending: 09/30/07 06/30/07 09/30/07 12/31/06 12/31/06 12/31/06 12/31/11 Metro Ranks Metro Rank Total Compared to: Metros 3Q07 2Q07 YTD 1 Year 3 Year 5 Year 5 Yr Forecast South Atlantic 24 5 4 5 5 5 5 5 United States 76 21 19 20 20 18 20 19 Vacancy Rate Trends and Forecast % 7.5 7.0 Palm Beach 6.5 South Atlantic 6.0 5.5 US 5.0 4.5 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Period ending 12/31/11 Copyright 2007 Reis, Inc. Page 17

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