U.S. OfficeTrends Report1st Quarter 2012
Contents                                        U.S. Office Sector Analysis...................................................
U.S. Office Sector AnalysisOffice Sector Summary                                                                            ...
U.S. Office Sector AnalysisOutlook cont.                                                                                   ...
Investment Sales                                                  U.S. Office Sales Volume                                 ...
Net Absorption                                               2009         2010         2011        2011 1Q      2011 2Q   ...
Net Absorption                                               2009         2010        2011      2011 1Q      2011 2Q     2...
Office Vacancy Rates                                           2009           2010           2011    2011 1Q   2011 2Q   20...
Office Vacancy Rates                                                2009           2010           2011    2011 1Q   2011 2Q...
Asking Rents                                            2009           2010            2011     2011 1Q   2011 2Q   2011 3...
Asking Rents                                           2009           2010            2011     2011 1Q   2011 2Q   2011 3Q...
Inventory                                                                           Inventory Change                      ...
Inventory                                                                                                     Inventory Ch...
Methodology                                                       Methodology                                             ...
A Leader in Commercial Real Estate ServicesKey                                  At Cassidy Turley, we are market leaders, ...
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Ct National Report 1 Q12 Final

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Ct National Report 1 Q12 Final

  1. 1. U.S. OfficeTrends Report1st Quarter 2012
  2. 2. Contents U.S. Office Sector Analysis........................................................................3-4 Investment Sales.........................................................................................5 Net Absorption by Metro............................................................................6-7 Vacancy Rates by Metro.............................................................................8-9 Asking Rents by Metro...........................................................................10-11 Inventory by Metro................................................................................12-13 Methodology..............................................................................................14 Kevin Thorpe Chief Economist 2101 L Street, NW, Ste. 700 Washington, DC 20037 Kevin.Thorpe@cassidyturley.com Jennifer Edwards Project Manager 2101 L Street, NW, Ste. 700 Washington, DC 20037 Jennifer.Edwards@cassidyturley.com2 | Cassidy Turley
  3. 3. U.S. Office Sector AnalysisOffice Sector Summary Market IndicatorsWhile far from robust, office sector fundamentals are improving consistently. The U.S. economy 1st Quarter 2012is generating enough net new jobs to fill empty space and drive overall vacancy rates downwards. 12-month 2012Since September of 2011, employers have added 1.2 million jobs, 400,000 of which are deemed Q1 Forecast“office-using.” As a result, in the first quarter of 2012, U.S. office vacancy rates inched downward10 basis points (bps) to end the quarter at 15.9%. Vacancy has receded by 120 bps from itsrecessionary peak recorded in mid-2010. Since then, nearly 83 million square feet of empty office Net Absorption 8.0Mspace has been leased. Likewise, U.S. office rents have been slowly inching upwards every quartersince 2010Q3. A pattern of improving fundamentals is clearly established. 15.9% VacancyAlthough the top line numbers are encouraging, the office sector is not recovering evenly acrossall markets. While demand for office space is accelerating in markets such as Houston, San Jose, Asking Rents $21.60San Francisco, Seattle, Austin, and Denver – all of which have either a tech story or energy storyunfolding - other markets are struggling to find an economic engine that will drive growth. Of the Under 42.1M80 major metros tracked, 23 are still reporting a decline in demand for space. Rent trends reveal Constructiona similar disparate story. On one end of the spectrum, rents are soaring in San Francisco and NewYork City -- up $9 per square foot (psf) and $5 psf, respectively, in 2012 compared to 2011. On theother end, office rents in Phoenix and Las Vegas are $1.00 lower than a year ago. Other than theseand other outliers, the general trend for most metros is one of some mild improvement in leasing fundamentals, but conditions far from robust.Likewise, the headline job growth figures also don’t tell the whole story. Based on the latest employment trends, the U.S. should have absorbed nearly20 million square feet (msf) of office space in the first quarter of 2012; instead, absorption totaled just 8.0 msf. One reason is that over 50% of the so-called “office-using jobs” created thus far in 2012 are temporary jobs. While temp jobs are a precursor for stronger payroll hiring down the road, theydo not move the needle instantaneously for the office sector. It is also worth noting that law firms -- historically a major driver of office space demandin most metro central business districts (CBDs) – have on the whole not been part of the current jobs recovery. Indeed, the legal services sector shed1,300 jobs in March, and there has been virtually no growth in that sector for the last 15 months.Investment sales have reaccelerated in the early months of 2012. Through the first two months of the year, office sales volume registered at $4.4billion, up 24% compared to the same period one year ago. Sales of CBD properties are driving the gains while suburban properties are experiencinga slight drop in deal activity year to date. With deal activity generally back up, pricing is holding firm. Price per square foot averaged $140 in Januaryand February, up 8% over a year ago. Once again, the mix of sales needs to be considered. According to Real Capital Analytics, more than half of theCBD properties that traded in February were located in New York or San Francisco – high-priced markets that will thus skew the overall average. It isencouraging to note that 10-year AAA swap spreads have come down 150bps since October of 2011 – signaling investor confidence in real estate isindeed growing. There were over $10 billion of significant properties reported under contract in February of this year. Thus, deal activity is accelerating.OutlookThe U.S. economic recovery is firming up. Real GDP is expanding at annualized rate of 2 to 3% in the first quarter of 2012, far stronger than the initialprojections which were closer to 1% to 1.5%. Most recent economic data has turned consistently positive. Most notably, recent consumer spendingdata on auto sales, home sales, and retail sales all indicate consumption will drive greater growth in 2012. In addition, equity markets are up around 8%thus far in 2012, consumer confidence is (finally) out of the gutter, and exports have returned to pre-recession levels. Leading indicators for the officesector – including jobless claims, copper price trends, business inventories -- generally point to an economy that is showing no signs of letting up fromits current pace of expansion.U.S. Absorption vs. Vacancy Net Absorption Select Markets Q1 2012 30 18% 2 20 17% 1.5 10 16% 1 Vacancy(msf) 0 15% (msf) 0.5 -10 14% -20 13% 0 Columbus San Francisco San Jose-Silicon Valley Denver-Aurora Raleigh Suburban MD Dallas N New Jersey San Mateo County Cincinnati Saint Louis Nashville-Davidson Long Island Indianapolis Kansas City San Diego Houston Miami Phoenix Charlotte Milwaukee Westchester Oakland-East Bay Seattle Louisville Atlanta Boston-Cambridge New York Baltimore C New Jersey Washington DC Los Angeles -30 12% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 -0.5 09 09 09 09 10 10 10 10 11 11 11 11 12 Absorption Vacancy Source: Cassidy Turley Research Source: BLS cassidyturley.com | 3
  4. 4. U.S. Office Sector AnalysisOutlook cont. Asking Rents Select Metros, 1st Quarter 2012Still, as we remember from last year, things can very easily go wrong. Spiking gas prices can kill %a recovery’s momentum since they cut directly into consumer spending. U.S. gas prices averaged Rents Change$3.92 a gallon in the week ending April 6, 2012, up almost 80 cents since December. Brent yr/yrCrude oil prices remain elevated at around $120 per barrel as we enter the busier travel seasons of New York, NY $55.58 9.7%spring and summer. Gas prices are almost certain to top $4.00 per gallon over the next few weeks. Washington DC $49.40 0.0%That said, it is also worth noting that oil inventories are now on the rise. Since the first weeks of San Francisco, CA $42.29 25.6%January this year, world-wide oil production has increased by about 30,000 barrels per day. The San Mateo County, CA $39.24 13.5%tensions with Iran (among other factors) are keeping oil prices stubbornly high, but the increased Boston-Cambridge, MA $31.06 0.7%supply will eventually do its job and bring gas prices down. Thus, the most likely scenario is that Suburban VA $31.02 3.5%gas prices will fall after the summer, as they did last year. Suburban MD $26.83 1.7%The euro-crisis poses another significant downside risk. The good news is the situation in Europe San Diego, CA $26.64 -2.6%looks far more stable currently than it did just a few months ago. The European Central Banks’ San Jose-Silicon Valley, CA $26.49 5.4%program to offer cheap short-term loans to individual European banks has been extremely Northern New Jersey $24.65 -3.5%successful at easing tensions. Sovereign debt yields have fallen sharply in most peripheral Minneapolis, MN $24.60 0.2%countries since that program was implemented back in December of 2011. Italy’s 10-year debt Houston, TX $23.76 4.3%was trading at a 5.4% yield as of April 11th, down from 7.1% at the beginning of the year. Even so, Central New Jersey $23.56 0.3%sovereign debt yields have inched up most recently – a reminder that we cannot take our eyes offof Europe when assessing the outlook for the U.S. Baltimore, MD $22.10 -1.9% Phoenix, AZ $20.82 -5.5%There will always be threats, but there are also many new signs that suggest the U.S. economic Denver, CO $20.31 2.5%recovery is maturing. Last year, the recovery was walking on eggshells. There was little margin for Tampa, FL $20.16 2.0%error. If any aspect of the global economy had strayed from the recovery script, confidence would Sacramento, CA $20.04 -4.0%have plunged and consumer spending and business expansion would have halted. This year, Dallas, TX $19.81 1.9%there are new developments that suggest the economy is on much stronger footing. For example,housing is finally showing clear signs of improvement. The months’ supply of existing home sales Oakland-East Bay, CA $19.80 -1.2%is at 6.4 – very close to what is considered a balanced market. Home sales are at an 18-month Nashville, TN $19.61 -2.6%high. For the first time in seven years, housing will contribute positively to GDP growth. It is also Raleigh, NC $19.50 -0.5%encouraging to see that consumers appear to have grown thicker skin. Even with gas prices rising Saint Louis, MO $18.90 -2.4%to uncomfortable levels, consumer confidence did not drop in the latest readings. Last year, a Atlanta, GA $18.79 -0.6%similar rise in gas prices sent confidence plunging. Charlotte, NC $18.53 0.9%In our baseline assumption, real GDP will grow by 2.6% in 2012, enough to generate 2.2 million Cincinnati, OH $18.47 5.4%net new jobs. True, a high percentage of the current jobs being created are temp jobs, but downthe road the labor market will evolve to generate more permanent payroll hiring. This will result Milwaukee, WI $18.26 -0.2%in much stronger office space absorption figures, particularly in the second half of the year. Of Indianapolis, IN $18.09 0.6%course, many things can go wrong, but at the moment, it would appear most things are going to go Kansas City, MO $17.76 -1.9%right for a while. Source: Cassidy Turley ResearchThreats Remain . . . But on track for better growthOil and Gas Prices Total Nonfarm Job Growth, 000’s Gas Prices Brent Crude 2.5 $4.00 $130 $3.90 2 $125 $3.80 $3.70 $120 1.5 $3.60 $115 1 $3.50 000’s $3.40 $110 0.5 $3.30 $105 $3.20 0 $3.10 $100 2010 2011 *2012 9-Mar-12 6-Apr-12 13-Jan-12 27-Jan-12 10-Feb-12 24-Feb-12 16-Dec-11 30-Dec-11 23-Mar-12 -0.5 -1 Unleaded Gas Brent Crude -1.5Source: Cassidy Turley Research, OPIS Source: BLS, *Cassidy Turley Forecast4 | Cassidy Turley
  5. 5. Investment Sales U.S. Office Sales Volume $30Office Sale Volume for Select MetrosJan - Feb 2012 $25 $ Volume Avg $20 (Millions) PPU Billions Manhattan, NY $1,886.9 $477 $15 DC Metro $1,146.5 $464 $10 Chicago, IL $766.4 $144 San Francisco, CA $514.1 $347 $5 NYC Boroughs $487.4 $327 $0 Seattle, WA $344.5 $287 Feb-06 Feb-07 Feb-08 Feb-09 Feb-10 Feb-11 Feb-12 Aug-06 Aug-07 Aug-08 Aug-09 Aug-10 Aug-11 Dallas, TX $320.9 $136 Boston, MA $245.2 $229 Los Angeles, CA $222.8 $191 closed Source: Real Capital Analytics San Diego, CA $201.4 $443 Phoenix, AZ $193.0 $208 San Jose, CA $189.2 $242 U.S. Office Cap Rates Houston, TX $183.3 $89 Minneapolis, MN $142.1 $140 10% Austin, TX $125.0 $170 9% Philadelphia, PA $112.0 $177 East Bay, CA $104.9 $144 8% Portland, OR $97.9 $252 7% Denver, CO $90.1 $95 Raleigh/Durham, NC $73.8 $118 6% Long Island, NY $72.2 $131 5% Tampa, FL $66.8 $201 Nashville, TN $62.8 $127 4% Feb-06 Feb-07 Feb-08 Feb-09 Feb-10 Feb-11 Feb-12 Aug-06 Aug-07 Aug-08 Aug-09 Aug-10 Aug-11 Orange County, CA $60.1 $690 Inland Empire, CA $59.0 $131 Detroit, MI $57.3 $253 CBD Suburban North Bay, CA $47.9 $72 Source: Real Capital Analytics Atlanta, GA $44.3 $56 Broward County, FL $42.4 $165 Baltimore, MD $38.8 $103 U.S. Office Acquisitions by Buyer TypeSource: Real Capital Analytics,Cassidy Turley Research $200 $160 Billions $120 $80 $40 $0 01 02 03 04 05 06 07 08 09 10 11 Cross-Border Instl/Eq Fund Listed/REITs Private User/other Source: Real Capital Analytics cassidyturley.com | 5
  6. 6. Net Absorption 2009 2010 2011 2011 1Q 2011 2Q 2011 3Q 2011 4Qr 2012 1Qp United States -69,564,000 19,895,000 52,217,000 10,654,000 12,017,000 15,510,000 13,394,000 7,951,000 Northeast -21,512,000 7,294,000 7,246,000 -293,000 2,229,000 5,534,000 -224,000 368,000 Midwest -10,048,000 -3,523,000 3,429,000 -211,000 523,000 238,000 2,237,000 679,000 South -13,066,000 12,303,000 20,471,000 5,351,000 2,551,000 6,005,000 6,565,000 2,398,000 West -24,939,000 3,821,000 21,071,000 5,808,000 6,714,000 3,733,000 4,816,000 4,506,000 Albuquerque, NM -396,000 81,000 58,000 177,000 84,000 -240,000 36,000 -5,000 Anaheim-Santa Ana, CA -3,949,000 -410,000 242,000 80,000 36,000 -93,000 219,000 155,000 Atlanta-Sandy Springs-Marietta, GA -3,007,000 -260,000 331,000 -245,000 -51,000 199,000 428,000 200,000 Austin-Round Rock, TX -131,000 891,000 2,155,000 16,000 548,000 931,000 660,000 438,000 Baltimore, MD 62,000 830,000 778,000 115,000 52,000 501,000 110,000 -45,000 Birmingham-Hoover, AL -617,000 -49,000 377,000 116,000 151,000 21,000 90,000 -6,000 Boston-Cambridge, MA -3,935,000 643,000 622,000 -191,000 -110,000 861,000 63,000 252,000 Buffalo-Niagara Falls, NY -130,000 -93,000 322,000 -12,000 293,000 174,000 -133,000 102,000 Charleston-North Charleston, SC -275,000 138,000 285,000 141,000 47,000 7,000 90,000 -13,000 Charlotte-Gastonia-Concord, NC-SC 220,000 1,089,000 1,286,000 648,000 219,000 280,000 139,000 8,000 Chattanooga, TN-GA -33,000 -54,000 96,000 50,000 106,000 -64,000 5,000 59,000 Chicago-Joliet-Naperville, IL-IN-WI -3,223,000 -422,000 -517,000 -418,000 -1,024,000 66,000 859,000 163,000 Cincinnati-Middletown, OH-KY-IN -152,000 -350,000 263,000 -70,000 381,000 -299,000 250,000 165,000 Cleveland-Elyria-Mentor, OH -438,000 -549,000 -175,000 -301,000 -1,000 -44,000 170,000 138,000 Colorado Springs, CO -244,000 685,000 575,000 437,000 173,000 -18,000 -17,000 152,000 Columbia, SC -75,000 -131,000 308,000 29,000 51,000 55,000 172,000 -137,000 Columbus, OH -641,000 -552,000 555,000 -87,000 201,000 347,000 94,000 110,000 Dallas, TX 601,000 894,000 2,738,000 823,000 -8,000 1,139,000 784,000 -100,000 Dayton, OH -817,000 -58,000 83,000 N/A -44,000 N/A 127,000 N/A Denver-Aurora, CO -335,000 2,284,000 1,532,000 445,000 199,000 416,000 473,000 416,000 Detroit-Warren-Livonia, MI -1,534,000 -1,035,000 1,185,000 -140,000 623,000 326,000 376,000 -232,000 Fairfield, CT -2,305,000 -661,000 720,000 381,000 76,000 374,000 -111,000 272,000 Ft. Lauderdale, FL -947,000 31,000 136,000 100,000 0 -91,000 127,000 186,000 Greensboro-Winston-Salem, NC 84,000 22,000 208,000 13,000 155,000 -68,000 108,000 143,000 Greenville, SC -367,000 98,000 199,000 63,000 19,000 96,000 21,000 79,000 Hartford-West Hartford-East Hartford, CT -412,000 -61,000 -147,000 -30,000 -143,000 35,000 -9,000 -243,000 Honolulu, HI 261,000 157,000 107,000 48,000 77,000 -15,000 -3,000 10,000 Houston, TX -508,000 725,000 2,646,000 1,034,000 -591,000 856,000 1,347,000 1,662,000 Indianapolis, IN -652,000 -376,000 -188,000 -98,000 -98,000 -86,000 94,000 40,000 Jacksonville, FL -585,000 22,000 630,000 302,000 280,000 -129,000 176,000 -43,000 Kansas City, MO-KS -353,000 -669,000 547,000 55,000 172,000 155,000 165,000 11,000 Knoxville, TN -204,000 286,000 153,000 -27,000 -64,000 117,000 127,000 154,000 Las Vegas-Paradise, NV -941,000 -721,000 994,000 486,000 276,000 364,000 -130,000 240,000 Lexington-Fayette,KY 15,000 -48,000 27,000 -3,000 -53,000 -12,000 95,000 -146,000 Little Rock-N. Little Rock, AR -142,000 36,000 22,000 19,000 10,000 26,000 -33,000 73,000 Los Angeles-Long Beach-Glendale, CA -4,514,000 -2,585,000 -383,000 3,000 -269,000 -275,000 158,000 638,000 Louisville, KY-IN -364,000 238,000 462,000 321,000 9,000 28,000 104,000 282,000 Madison, WI 44,000 -226,000 -46,000 -105,000 55,000 -33,000 36,000 109,000 Memphis, TN-MS-AR -289,000 -12,000 215,000 38,000 -19,000 102,000 94,000 -11,000 Miami-Dade, FL -796,000 754,000 1,018,000 -179,000 444,000 231,000 521,000 301,000 Milwaukee-Waukesha-West Allis, WI -597,000 -262,000 290,000 40,000 93,000 47,000 111,000 -19,000 Minneapolis-St. Paul-Bloomington, MN-WI -1,799,000 741,000 1,017,000 682,000 257,000 -114,000 192,000 39,000 Nashville-Davidson-Murfreesboro, TN 80,000 925,000 744,000 159,000 40,000 334,000 211,000 102,000 New Haven-Milford, CT -1,488,000 244,000 240,000 26,000 -5,000 22,000 197,000 22,0006 | Cassidy Turley
  7. 7. Net Absorption 2009 2010 2011 2011 1Q 2011 2Q 2011 3Q 2011 4Qr 2012 1QpNew Orleans-Metairie-Kenner, LA 312,000 -558,000 253,000 252,000 -41,000 23,000 18,000 83,000New York, NY -10,871,000 9,564,000 4,217,000 -1,543,000 2,710,000 2,429,000 621,000 165,000Long Island, NY 733,000 87,000 797,000 378,000 -291,000 771,000 -62,000 74,000Northern New Jersey -1,508,000 -971,000 -901,000 91,000 -403,000 -363,000 -226,000 -156,000Central New Jersey -490,000 -117,000 -149,000 -180,000 -98,000 398,000 -269,000 -169,000Oakland-East Bay, CA -2,916,000 34,000 506,000 -353,000 623,000 520,000 -284,000 -32,000Oklahoma City, OK 126,000 1,000 413,000 103,000 32,000 286,000 -8,000 89,000Omaha, NE-IA -154,000 225,000 144,000 239,000 -35,000 -23,000 -37,000 29,000Orlando, FL -1,242,000 311,000 1,232,000 346,000 196,000 356,000 333,000 296,000West Palm Beach-Boca Raton, FL -810,000 137,000 841,000 280,000 390,000 266,000 -95,000 13,000Philadelphia-Camden-Wilmington, PA-NJ -1,160,000 -562,000 1,157,000 523,000 192,000 652,000 -210,000 133,000Phoenix-Mesa-Scottsdale, AZ -610,000 -52,000 653,000 -74,000 260,000 374,000 93,000 91,000Pittsburgh, PA 322,000 221,000 649,000 152,000 229,000 42,000 226,000 224,000Portland-South Portland-Biddeford, ME 8,000 -364,000 -238,000 -43,000 -67,000 -18,000 -110,000 27,000Portland-Vancouver-Beaverton, OR-WA -1,158,000 -173,000 905,000 385,000 5,000 133,000 382,000 89,000Raleigh-Durham, NC -538,000 222,000 113,000 154,000 -60,000 -165,000 183,000 300,000Rochester, NY -87,000 -49,000 392,000 115,000 70,000 309,000 -102,000 -229,000Sacramento-Arden-Arcade-Roseville, CA 205,000 -761,000 24,000 -261,000 64,000 168,000 52,000 -91,000Saint Louis, MO-IL -279,000 16,000 321,000 21,000 -64,000 -80,000 -198,000 137,000Salt Lake City, UT -559,000 781,000 1,122,000 213,000 240,000 402,000 267,000 72,000San Antonio, TX 303,000 199,000 346,000 4,000 43,000 218,000 80,000 281,000San Diego-Carlsbad-San Marcos, CA -476,000 607,000 686,000 -324,000 292,000 292,000 425,000 -26,000San Francisco, CA -1,713,000 1,028,000 2,945,000 778,000 659,000 614,000 895,000 1,056,000San Jose-Silicon Valley, CA -5,627,000 1,434,000 5,774,000 1,935,000 1,900,000 504,000 1,435,000 907,000San Mateo County, CA 342,000 273,000 1,564,000 927,000 498,000 36,000 103,000 245,000Seattle-Tacoma-Bellevue, WA -1,797,000 1,120,000 3,808,000 1,012,000 1,714,000 603,000 480,000 475,000Suburban MD -686,000 107,000 868,000 340,000 223,000 -248,000 553,000 -98,000Suburban VA -1,713,000 1,720,000 -120,000 -254,000 215,000 213,000 -293,000 -1,254,000Syracuse, NY -120,000 22,000 -109,000 41,000 -75,000 -59,000 -15,000 -80,000Tampa-St.Petersburg-Clearwater, FL -1,582,000 -65,000 540,000 -57,000 -52,000 290,000 360,000 -270,000Tucson, AZ -354,000 13,000 175,000 -2,000 -37,000 -18,000 231,000 3,000Tulsa, OK -73,000 -17,000 373,000 246,000 93,000 75,000 -41,000 22,000Ventura County, CA -157,000 26,000 -215,000 -104,000 -79,000 -35,000 3,000 109,000Washington DC 116,000 3,822,000 799,000 404,000 164,000 131,000 99,000 -248,000Wichita, KS 547,000 -4,000 -50,000 -30,000 6,000 -26,000 0 -12,000Westchester, NY -69,000 -608,000 -328,000 -2,000 -146,000 -95,000 -85,000 -26,000Methodology and data sources explained on page 14p = preliminaryr = revision cassidyturley.com | 7
  8. 8. Office Vacancy Rates 2009 2010 2011 2011 1Q 2011 2Q 2011 3Q 2011 4Qr 2012 1Qp (Quarterly Average)United States 16.1% 17.0% 16.4% 16.7% 16.5% 16.3% 16.0% 15.9%Northeast 14.7% 15.5% 15.4% 15.5% 15.5% 15.2% 15.4% 15.5%Midwest 18.1% 19.5% 19.5% 19.6% 19.7% 19.5% 19.2% 19.1%South 15.7% 16.6% 15.7% 16.0% 15.9% 15.6% 15.1% 15.0%West 16.4% 17.1% 16.2% 16.6% 16.3% 16.2% 15.9% 15.6%Albuquerque, NM 13.5% 14.4% 13.5% 13.1% 12.6% 14.4% 14.0% 14.3%Anaheim-Santa Ana, CA 16.9% 18.6% 18.2% 18.2% 18.2% 18.3% 18.1% 17.9%Atlanta-Sandy Springs-Marietta, GA 19.3% 21.3% 21.4% 21.5% 21.5% 21.3% 21.3% 21.0%Austin-Round Rock, TX 18.9% 18.1% 14.9% 17.3% 16.2% 13.9% 12.3% 11.2%Baltimore, MD 18.8% 19.7% 19.3% 19.2% 19.6% 19.4% 19.0% 19.6%Birmingham-Hoover, AL 10.6% 12.4% 11.2% 11.8% 11.0% 11.2% 10.7% 10.8%Boston-Cambridge, MA 12.5% 13.6% 14.4% 14.5% 14.5% 14.1% 14.5% 14.4%Buffalo-Niagara Falls, NY 12.6% 13.5% 12.1% 13.5% 12.0% 11.1% 11.7% 11.2%Charleston-North Charleston, SC 16.0% 14.6% 11.0% 11.3% 11.2% 11.1% 10.6% 10.8%Charlotte-Gastonia-Concord, NC-SC 13.8% 14.5% 13.0% 13.2% 12.6% 13.1% 13.2% 13.0%Chattanooga, TN-GA 15.3% 17.9% 14.9% 16.0% 13.8% 15.0% 14.9% 13.7%Chicago-Joliet-Naperville, IL-IN-WI 17.0% 17.8% 18.4% 18.2% 18.6% 18.6% 18.2% 18.1%Cincinnati-Middletown, OH-KY-IN 19.5% 22.9% 23.9% 23.5% 24.2% 24.3% 23.7% 23.5%Cleveland-Elyria-Mentor, OH 17.7% 19.0% 20.5% 20.4% 20.4% 20.8% 20.3% 20.1%Colorado Springs, CO 18.9% 16.6% 10.7% 11.5% 10.3% 10.5% 10.6% 9.5%Columbia, SC 14.5% 16.3% 14.7% 15.7% 15.3% 14.8% 13.2% 14.4%Columbus, OH 16.1% 18.7% 18.3% 19.7% 18.9% 17.6% 17.1% 16.8%Dallas, TX 21.4% 22.9% 22.1% 22.1% 22.5% 22.1% 21.6% 21.6%Dayton, OH 24.3% 28.0% 28.4% 28.3% 28.7% 28.7% 27.8% 27.8%Denver-Aurora, CO 14.6% 14.3% 13.7% 13.9% 13.9% 13.6% 13.4% 13.2%Detroit-Warren-Livonia, MI 24.1% 25.1% 24.5% 25.5% 24.7% 24.2% 23.7% 23.9%Fairfield, CT 19.1% 21.3% 20.5% 20.9% 20.7% 20.1% 20.3% 19.8%Ft. Lauderdale, FL 16.6% 18.2% 18.1% 18.1% 18.1% 18.4% 17.9% 17.2%Greensboro-Winston-Salem, NC 18.4% 18.8% 18.3% 18.9% 18.0% 18.4% 17.8% 17.0%Greenville, SC 18.2% 19.4% 18.1% 18.7% 18.4% 17.7% 17.4% 16.7%Hartford-West Hartford-East Hartford, CT 19.3% 21.7% 22.9% 22.4% 23.1% 23.0% 23.1% 24.1%Honolulu, HI 7.3% 7.1% 6.8% 7.0% 6.7% 6.7% 6.7% 6.7%Houston, TX 15.3% 15.9% 15.5% 15.5% 15.8% 15.7% 15.1% 14.3%Indianapolis, IN 19.9% 21.0% 20.6% 20.7% 20.7% 20.6% 20.3% 20.2%Jacksonville, FL 19.0% 19.8% 17.3% 18.0% 16.9% 17.4% 16.7% 17.1%Kansas City, MO-KS 19.2% 20.8% 21.8% 22.1% 21.9% 21.8% 21.5% 21.5%Knoxville, TN 15.5% 16.6% 17.1% 17.1% 18.6% 17.2% 15.4% 13.3%Las Vegas-Paradise, NV 21.4% 23.9% 21.8% 22.4% 22.1% 21.1% 21.7% 21.8%Lexington-Fayette,KY 16.5% 16.9% 18.6% 18.2% 19.4% 19.4% 17.2% 20.6%Little Rock-N. Little Rock, AR 11.1% 12.1% 11.5% 11.7% 11.6% 11.1% 11.4% 10.9%Los Angeles-Long Beach-Glendale, CA 12.2% 13.7% 14.2% 14.1% 14.2% 14.4% 14.4% 14.1%Louisville, KY-IN 13.8% 15.0% 15.6% 14.4% 16.4% 16.5% 15.2% 15.8%Madison, WI 8.7% 9.4% 10.2% 10.3% 10.1% 10.2% 10.2% 9.7%Memphis, TN-MS-AR 18.2% 19.0% 18.8% 19.1% 19.2% 18.7% 18.2% 18.2%Miami-Dade, FL 13.4% 14.3% 14.2% 14.5% 14.1% 14.7% 13.5% 12.8%Milwaukee-Waukesha-West Allis, WI 19.4% 20.9% 20.9% 21.4% 21.1% 20.5% 20.5% 20.9%Minneapolis-St. Paul-Bloomington, MN-WI 18.9% 19.3% 17.6% 17.0% 18.1% 17.7% 17.5% 17.2%Nashville-Davidson-Murfreesboro, TN 16.0% 15.7% 13.4% 14.0% 14.0% 13.1% 12.6% 12.3%8 | Cassidy Turley
  9. 9. Office Vacancy Rates 2009 2010 2011 2011 1Q 2011 2Q 2011 3Q 2011 4Qr 2012 1Qp (Quarterly Average)New Haven-Milford, CT 16.3% 16.6% 16.1% 16.0% 16.1% 15.8% 16.3% 16.1%New Orleans-Metairie-Kenner, LA 8.5% 9.1% 10.1% 10.1% 10.2% 10.1% 10.0% 9.8%New York, NY 13.5% 12.0% 11.5% 12.3% 11.6% 11.0% 10.9% 10.6%Long Island, NY 16.4% 16.7% 16.2% 16.2% 16.7% 15.9% 15.9% 15.8%Northern New Jersey 13.2% 14.0% 14.6% 14.3% 14.4% 14.8% 14.9% 15.0%Central New Jersey 16.3% 16.5% 16.5% 16.6% 16.7% 16.2% 16.5% 16.6%Oakland-East Bay, CA 17.3% 18.3% 19.0% 19.7% 19.2% 18.8% 18.1% 17.7%Oklahoma City, OK 15.7% 16.6% 16.2% 16.9% 16.6% 15.6% 15.6% 15.5%Omaha, NE-IA 14.8% 15.6% 14.4% 13.8% 14.5% 14.5% 14.7% 14.4%Orlando, FL 15.3% 16.5% 13.8% 14.9% 14.5% 13.4% 12.4% 11.9%West Palm Beach-Boca Raton, FL 17.6% 18.4% 14.9% 16.4% 15.0% 13.9% 14.3% 14.3%Philadelphia-Camden-Wilmington, PA-NJ 12.9% 13.9% 13.3% 13.5% 13.6% 13.0% 13.2% 13.1%Phoenix-Mesa-Scottsdale, AZ 25.8% 27.7% 28.1% 28.3% 28.0% 28.1% 27.9% 28.2%Pittsburgh, PA 15.4% 15.5% 14.8% 15.2% 14.8% 14.6% 14.6% 14.4%Portland-South Portland-Biddeford, ME 8.1% 9.2% 11.3% 10.8% 11.2% 11.2% 11.8% 11.7%Portland-Vancouver-Beaverton, OR-WA 13.3% 14.3% 12.9% 13.2% 13.2% 13.0% 12.3% 12.1%Raleigh-Durham, NC 18.7% 19.2% 18.7% 19.0% 18.9% 18.5% 18.3% 17.8%Rochester, NY 15.8% 16.1% 14.1% 15.2% 14.7% 12.7% 13.8% 15.3%Sacramento-Arden-Arcade-Roseville, CA 15.7% 16.7% 17.7% 17.6% 17.7% 17.6% 18.0% 18.0%Saint Louis, MO-IL 15.7% 16.5% 16.9% 16.9% 16.9% 16.9% 16.9% 16.8%Salt Lake City, UT 12.8% 14.4% 12.1% 13.3% 12.5% 11.7% 10.8% 11.1%San Antonio, TX 16.6% 17.2% 17.7% 18.1% 18.2% 17.4% 17.3% 16.9%San Diego-Carlsbad-San Marcos, CA 21.1% 19.9% 19.3% 19.8% 19.6% 19.1% 18.6% 18.7%San Francisco, CA 15.5% 15.6% 12.4% 13.6% 12.8% 12.1% 11.0% 10.3%San Jose-Silicon Valley, CA 18.2% 18.7% 15.5% 16.7% 15.6% 15.2% 14.4% 13.8%San Mateo County, CA 18.2% 16.3% 13.2% 14.0% 13.0% 13.0% 12.8% 13.2%Seattle-Tacoma-Bellevue, WA 14.2% 16.9% 15.1% 16.4% 15.2% 14.7% 14.1% 13.5%Suburban MD 14.5% 15.2% 15.4% 15.5% 15.4% 15.6% 15.1% 15.5%Suburban VA 14.0% 14.3% 14.1% 14.1% 14.1% 14.0% 14.2% 15.4%Syracuse, NY 13.0% 13.1% 14.2% 13.3% 13.9% 14.7% 14.8% 15.4%Tampa-St.Petersburg-Clearwater, FL 19.6% 21.0% 20.7% 21.0% 21.1% 20.6% 20.1% 20.3%Tucson, AZ 13.5% 14.2% 14.5% 14.2% 15.0% 15.2% 13.8% 13.7%Tulsa, OK 17.4% 17.6% 16.4% 16.8% 16.4% 16.0% 16.3% 16.2%Ventura County, CA 17.3% 17.5% 20.3% 19.3% 20.3% 20.8% 20.8% 19.5%Washington DC 10.0% 11.1% 10.4% 10.3% 10.3% 10.6% 10.4% 10.4%Wichita, KS 17.5% 17.7% 17.4% 17.4% 17.3% 17.5% 17.5% 17.5%Westchester, NY 16.4% 18.1% 18.9% 18.3% 18.9% 19.1% 19.2% 19.3%Methodology and data sources explained on page 14p = preliminaryr = revisions* Vacancy = Direct + Sublet cassidyturley.com | 9
  10. 10. Asking Rents 2009 2010 2011 2011 1Q 2011 2Q 2011 3Q 2011 4Qr 2012 1Qp (Quarterly Average) United States $21.89 $21.36 $21.40 $21.36 $21.37 $21.41 $21.47 $21.60 Northeast $24.39 $23.30 $23.77 $23.63 $23.66 $23.78 $24.02 $24.33 Midwest $18.43 $18.30 $18.27 $18.20 $18.27 $18.34 $18.26 $18.24 South $20.94 $20.77 $20.56 $20.61 $20.55 $20.54 $20.54 $20.61 West $23.96 $22.96 $23.12 $23.04 $23.08 $23.12 $23.22 $23.44 Albuquerque, NM $16.42 $16.12 $15.58 $15.82 $15.77 $15.45 $15.30 $15.31 Anaheim-Santa Ana, CA $26.32 $23.68 $22.52 $22.79 $22.62 $22.42 $22.23 $21.80 Atlanta-Sandy Springs-Marietta, GA $19.58 $19.10 $18.77 $18.91 $18.76 $18.60 $18.82 $18.79 Austin-Round Rock, TX $25.24 $24.81 $24.36 $24.12 $24.40 $24.49 $24.42 $24.54 Baltimore, MD $22.97 $22.66 $22.19 $22.53 $22.15 $22.13 $21.93 $22.10 Birmingham-Hoover, AL $17.93 $17.67 $17.74 $17.69 $17.62 $17.73 $17.95 $17.92 Boston-Cambridge, MA $35.53 $29.97 $31.01 $30.85 $30.91 $31.17 $31.09 $31.06 Buffalo-Niagara Falls, NY $15.79 $16.38 $16.73 $16.69 $16.57 $16.95 $16.73 $16.75 Charleston-North Charleston, SC $19.10 $19.25 $19.01 $19.10 $18.87 $19.23 $18.83 $18.65 Charlotte-Gastonia-Concord, NC-SC $19.78 $19.02 $18.40 $18.37 $18.49 $18.25 $18.50 $18.53 Chattanooga, TN-GA $14.73 $14.22 $13.92 $13.59 $13.77 $13.78 $14.55 $15.04 Chicago-Joliet-Naperville, IL-IN-WI $25.18 $24.64 $24.43 $24.40 $24.33 $24.49 $24.50 $25.11 Cincinnati-Middletown, OH-KY-IN $18.00 $17.88 $18.15 $17.53 $18.22 $18.37 $18.46 $18.47 Cleveland-Elyria-Mentor, OH $17.80 $18.17 $17.83 $18.04 $17.79 $17.71 $17.78 $18.01 Colorado Springs, CO $16.47 $15.49 $16.04 $15.84 $15.94 $15.95 $16.43 $16.31 Columbia, SC $15.69 $15.88 $15.60 $15.68 $15.74 $15.56 $15.44 $15.51 Columbus, OH $18.70 $17.73 $17.21 $17.31 $17.23 $17.20 $17.09 $17.11 Dallas, TX $21.32 $19.78 $19.53 $19.45 $19.50 $19.65 $19.53 $19.81 Dayton, OH $14.96 $14.75 $14.56 $14.53 $14.63 $14.63 $14.46 $14.46 Denver-Aurora, CO $20.67 $19.92 $20.14 $19.82 $20.20 $20.26 $20.27 $20.31 Detroit-Warren-Livonia, MI $18.92 $18.68 $18.31 $18.46 $18.29 $18.22 $18.28 $18.21 Fairfield, CT $31.58 $29.84 $30.42 $29.93 $30.08 $30.17 $31.48 $34.14 Ft. Lauderdale, FL $25.33 $24.88 $24.49 $24.82 $24.60 $24.32 $24.22 $24.05 Greensboro-Winston-Salem, NC $15.39 $15.31 $15.44 $15.46 $15.40 $15.54 $15.38 $15.35 Greenville, SC $15.97 $16.07 $15.76 $15.97 $15.92 $15.53 $15.64 $15.59 Hartford-West Hartford-East Hartford, CT $19.49 $19.09 $19.39 $19.28 $19.51 $19.48 $19.32 $19.07 Honolulu, HI $23.57 $27.19 $28.56 $28.94 $28.87 $28.25 $28.18 $28.78 Houston, TX $23.92 $23.15 $22.96 $22.79 $22.72 $23.01 $23.33 $23.76 Indianapolis, IN $17.59 $17.55 $18.08 $17.98 $18.11 $18.11 $18.11 $18.09 Jacksonville, FL $18.28 $17.69 $17.05 $17.15 $17.07 $16.99 $16.99 $17.07 Kansas City, MO-KS $18.79 $18.35 $18.10 $18.10 $18.21 $18.10 $17.97 $17.76 Knoxville, TN $15.73 $15.92 $15.85 $15.90 $15.91 $15.70 $15.91 $15.88 Las Vegas-Paradise, NV $24.30 $22.68 $21.59 $22.02 $21.86 $21.46 $21.04 $20.88 Lexington-Fayette,KY $16.37 $16.74 $15.89 $16.14 $16.02 $15.90 $15.51 $15.52 Little Rock-N. Little Rock, AR $14.59 $15.05 $14.98 $15.51 $15.47 $14.46 $14.46 $15.05 Los Angeles-Long Beach-Glendale, CA $31.11 $29.41 $29.26 $29.09 $29.09 $29.27 $29.60 $29.39 Louisville, KY-IN $15.84 $16.90 $17.00 $17.18 $17.00 $16.84 $16.97 $16.97 Madison, WI $16.15 $16.70 $17.36 $17.08 $17.09 $17.52 $17.74 $17.25 Memphis, TN-MS-AR $17.54 $18.95 $18.82 $18.78 $18.73 $18.93 $18.82 $18.86 Miami-Dade, FL $29.56 $28.55 $27.52 $27.70 $27.62 $27.39 $27.37 $27.31 Milwaukee-Waukesha-West Allis, WI $18.07 $18.38 $18.35 $18.29 $18.26 $18.65 $18.21 $18.26 Minneapolis-St. Paul-Bloomington, MN-WI $24.60 $24.60 $24.58 $24.55 $24.55 $24.60 $24.60 $24.64 Nashville-Davidson-Murfreesboro, TN $20.23 $20.17 $19.96 $20.13 $19.91 $20.00 $19.80 $19.6110 | Cassidy Turley
  11. 11. Asking Rents 2009 2010 2011 2011 1Q 2011 2Q 2011 3Q 2011 4Qr 2012 1Qp (Quarterly Average)New Haven-Milford, CT $20.50 $20.38 $20.01 $20.28 $20.03 $19.85 $19.85 $20.11New Orleans-Metairie-Kenner, LA $15.22 $15.39 $14.96 $14.94 $14.87 $15.03 $14.98 $14.97New York, NY $51.10 $47.66 $51.99 $50.66 $51.44 $52.01 $53.84 $55.58Long Island, NY $26.44 $26.26 $25.97 $25.93 $26.14 $25.79 $26.00 $26.11Northern New Jersey $26.39 $25.38 $25.00 $25.55 $24.92 $24.82 $24.72 $24.65Central New Jersey $23.91 $23.23 $23.37 $23.48 $23.43 $23.31 $23.24 $23.56Oakland-East Bay, CA $21.61 $20.71 $20.06 $20.04 $20.16 $20.10 $19.92 $19.80Oklahoma City, OK $13.96 $13.67 $13.41 $13.58 $13.41 $13.47 $13.17 $13.25Omaha, NE-IA $16.74 $17.01 $17.30 $17.26 $17.35 $17.46 $17.10 $16.94Orlando, FL $21.31 $20.20 $19.69 $19.84 $19.71 $19.63 $19.61 $19.71West Palm Beach-Boca Raton, FL $28.28 $27.73 $27.09 $27.30 $27.13 $26.97 $26.96 $26.81Philadelphia-Camden-Wilmington, PA-NJ $23.44 $22.99 $23.05 $22.84 $23.08 $23.14 $23.11 $23.18Phoenix-Mesa-Scottsdale, AZ $23.80 $22.71 $21.72 $22.03 $21.94 $21.63 $21.29 $20.82Pittsburgh, PA $19.34 $19.49 $19.38 $19.44 $19.29 $19.33 $19.49 $19.46Portland-South Portland-Biddeford, ME $14.53 $14.50 $14.36 $14.50 $14.35 $14.24 $14.36 $14.40Portland-Vancouver-Beaverton, OR-WA $20.84 $20.61 $20.60 $20.63 $20.58 $20.65 $20.52 $20.45Raleigh-Durham, NC $19.70 $19.60 $19.53 $19.60 $19.52 $19.50 $19.50 $19.50Rochester, NY $14.81 $14.08 $13.96 $14.05 $14.05 $13.91 $13.83 $13.88Sacramento-Arden-Arcade-Roseville, CA $22.44 $21.48 $20.52 $20.88 $20.76 $20.28 $20.16 $20.04Saint Louis, MO-IL $19.77 $19.44 $19.22 $19.37 $19.35 $19.15 $18.99 $18.90Salt Lake City, UT $18.08 $17.76 $17.55 $17.69 $17.53 $17.43 $17.55 $17.59San Antonio, TX $18.98 $19.05 $19.43 $19.36 $19.63 $19.50 $19.26 $19.53San Diego-Carlsbad-San Marcos, CA $30.09 $27.57 $26.94 $27.36 $27.24 $26.52 $26.64 $26.64San Francisco, CA $35.75 $32.04 $35.75 $33.66 $34.77 $36.39 $38.17 $42.29San Jose-Silicon Valley, CA $27.10 $25.19 $25.60 $25.13 $25.34 $25.65 $26.27 $26.49San Mateo County, CA $33.00 $30.81 $36.42 $34.56 $35.28 $37.92 $37.92 $39.24Seattle-Tacoma-Bellevue, WA $28.54 $27.24 $26.67 $26.91 $26.62 $26.50 $26.65 $26.47Suburban MD $27.46 $26.61 $26.62 $26.38 $26.57 $26.86 $26.68 $26.83Suburban VA $29.74 $29.56 $30.28 $29.98 $29.98 $30.30 $30.86 $31.02Syracuse, NY $14.58 $14.18 $14.89 $14.29 $14.33 $15.45 $15.48 $15.64Tampa-St.Petersburg-Clearwater, FL $20.61 $20.03 $19.85 $19.77 $19.65 $19.68 $20.30 $20.16Tucson, AZ $20.92 $20.17 $19.67 $19.88 $19.71 $19.64 $19.44 $19.15Tulsa, OK $14.63 $15.77 $15.77 $15.80 $15.81 $15.80 $15.66 $15.69Ventura County, CA $24.69 $24.16 $23.67 $23.88 $23.77 $23.52 $23.51 $23.68Washington DC $47.54 $48.70 $49.41 $49.39 $49.12 $49.78 $49.36 $49.40Wichita, KS $12.11 $12.16 $11.86 $11.74 $11.84 $11.94 $11.93 $11.91Westchester, NY $28.36 $26.04 $27.07 $26.71 $26.78 $27.04 $27.74 $27.31Methodology and data sources explained on page 14p = preliminary cassidyturley.com | 11
  12. 12. Inventory Inventory Change Inventory Vacant Stock U/C (as of 2012 Q1) (YTD 2012) National Total 5,352,055,000 853,958,000 5,088,000 42,143,000 Albuquerque, NM 13,432,000 1,924,000 44,000 21,000 Anaheim-Santa Ana, CA 82,523,000 14,745,000 0 0 Atlanta-Sandy Springs-Marietta, GA 186,539,000 39,173,000 16,000 811,000 Austin-Round Rock, TX 40,519,000 4,546,000 0 346,000 Baltimore, MD 73,015,000 14,311,000 475,000 494,000 Birmingham-Hoover, AL 18,380,000 1,980,000 0 38,000 Boston-Cambridge, MA 149,450,000 21,525,000 0 1,229,000 Buffalo-Niagara Falls, NY 20,832,000 2,330,000 0 0 Charleston-North Charleston, SC 7,720,000 833,000 0 0 Charlotte-Gastonia-Concord, NC-SC 97,447,000 12,668,000 0 0 Chattanooga, TN-GA 4,834,000 661,000 0 0 Chicago-Joliet-Naperville, IL-IN-WI 244,093,000 44,301,000 0 0 Cincinnati-Middletown, OH-KY-IN 32,908,000 7,727,000 0 0 Cleveland-Elyria-Mentor, OH 35,226,000 7,081,000 80,000 0 Colorado Springs, CO 14,920,000 1,422,000 0 0 Columbia, SC 10,750,000 1,552,000 0 0 Columbus, OH 26,610,000 4,457,000 0 862,000 Dallas, TX 203,662,000 43,991,000 18,000 866,000 Dayton, OH 13,888,000 3,861,000 0 488,000 Denver-Aurora, CO 169,415,000 22,363,000 446,000 794,000 Detroit-Warren-Livonia, MI 75,755,000 18,139,000 0 80,000 Fairfield, CT 58,071,000 11,498,000 0 75,000 Ft. Lauderdale, FL 27,099,000 4,660,000 0 0 Greensboro-Winston-Salem, NC 17,891,000 3,034,000 0 39,000 Greenville, SC 8,890,000 1,482,000 15,000 254,000 Hartford-West Hartford-East Hartford, CT 24,627,000 5,941,000 22,000 0 Honolulu, HI 25,584,000 1,714,000 0 0 Houston, TX 218,354,000 31,225,000 1,139,000 2,876,000 Indianapolis, IN 317,709,000 64,177,000 0 0 Jacksonville, FL 24,869,000 4,241,000 49,000 0 Kansas City, MO-KS 48,716,000 10,456,000 0 287,000 Knoxville, TN 7,060,000 936,000 0 0 Las Vegas-Paradise, NV 26,574,000 5,797,000 355,000 266,000 Lexington-Fayette,KY 4,364,000 897,000 0 139,000 Little Rock-N. Little Rock, AR 10,445,000 1,143,000 24,000 0 Los Angeles-Long Beach-Glendale, CA 195,803,000 27,664,000 225,000 1,455,000 Louisville, KY-IN 20,868,000 3,297,000 229,000 229,000 Madison, WI 21,954,000 2,127,000 0 78,000 Memphis, TN-MS-AR 19,504,000 3,558,000 0 26,000 Miami-Dade, FL 43,053,000 5,526,000 0 503,000 Milwaukee-Waukesha-West Allis, WI 28,011,000 5,854,000 0 0 Minneapolis-St. Paul-Bloomington, MN-WI 69,112,000 11,887,000 0 0 Nashville-Davidson-Murfreesboro, TN 33,248,000 4,078,000 0 670,000 New Haven-Milford, CT 12,163,000 1,959,000 0 140,000 New Orleans-Metairie-Kenner, LA 36,065,000 3,540,000 0 0 New York, NY 460,969,000 48,863,000 0 10,078,000 Long Island, NY 71,015,000 11,220,000 0 0 Northern New Jersey 148,004,000 22,201,000 0 768,000 Central New Jersey 104,834,000 17,402,000 52,000 506,00012 | Cassidy Turley
  13. 13. Inventory Inventory Change Inventory Vacant Stock U/C (as of 2012 Q1) (YTD 2012)Oakland-East Bay, CA 110,056,000 19,480,000 0 90,000Oklahoma City, OK 17,886,000 2,768,000 73,000 2,152,000Omaha, NE-IA 18,000,000 2,599,000 0 1,031,000Orlando, FL 32,918,000 3,910,000 134,000 280,000West Palm Beach-Boca Raton, FL 24,101,000 3,436,000 0 180,000Philadelphia-Camden-Wilmington, PA-NJ 112,361,000 14,751,000 0 1,469,000Phoenix-Mesa-Scottsdale, AZ 68,247,000 19,246,000 0 0Pittsburgh, PA 49,932,000 7,194,000 130,000 530,000Portland-South Portland-Biddeford, ME 17,886,000 2,092,000 0 0Portland-Vancouver-Beaverton, OR-WA 41,332,000 4,991,000 0 507,000Raleigh-Durham, NC 46,825,000 8,312,000 0 48,000Rochester, NY 15,638,000 2,390,000 0 0Sacramento-Arden-Arcade-Roseville, CA 84,732,000 15,252,000 72,000 0Saint Louis, MO-IL 46,441,000 7,802,000 227,000 111,000Salt Lake City, UT 30,472,000 3,384,000 170,000 1,125,000San Antonio, TX 29,036,000 4,894,000 200,000 1,097,000San Diego-Carlsbad-San Marcos, CA 73,319,000 13,728,000 0 372,000San Francisco, CA 82,779,000 8,485,000 0 71,000San Jose-Silicon Valley, CA 199,568,000 27,600,000 0 1,950,000San Mateo County, CA 50,381,000 6,650,000 0 0Seattle-Tacoma-Bellevue, WA 84,275,000 11,384,000 0 1,007,000Suburban MD 71,714,000 11,116,000 185,000 631,000Suburban VA 152,959,000 23,556,000 655,000 2,644,000Syracuse, NY 12,696,000 1,957,000 0 0Tampa-St.Petersburg-Clearwater, FL 59,501,000 12,079,000 54,000 355,000Tucson, AZ 6,172,000 847,000 0 98,000Tulsa, OK 20,303,000 3,282,000 0 51,000Ventura County, CA 8,370,000 1,629,000 0 117,000Washington DC 122,051,000 12,751,000 0 1,808,000Wichita, KS 13,847,000 2,425,000 0 0Westchester, NY 41,483,000 8,006,000 0 0Methodology and data sources explained on page 14p = preliminaryUnder construction and inventory change figures are derived from Cassidy Turley’s proprietarysample and taken directly from CoStar’s database for certain markets. cassidyturley.com | 13
  14. 14. Methodology Methodology Cassidy Turley’s quarterly estimates are derived from a variety of data sources, including its own proprietary sample of market activity, historical inventory data from Reis LLC, Bureau Disclaimer of Labor Statistics Employment data, CoStar and other third party data sources. The market statistics are calculated from a base building inventory made up of office properties deemed This report and other research materials may to be competitive in the local office markets. Generally, owner-occupied and federally-owned be found on our website at www.cassidyturley. buildings are not included. Single-tenant buildings and privately-owned buildings in which com. This is a research document of Cassidy the federal government leases space are included. Older buildings unfit for occupancy or Turley in Washington, DC. Questions related ones that require substantial renovation before tenancy are generally not included in the to information herein should be directed competitive inventory. The inventory is subject to revisions due to resampling. Vacant space to the Research Department at 202-463- is defined as space that is available immediately or three months (90 days) after the end of 2100. Information contained herein has the quarter. Sublet space still occupied by the tenant is not counted as available space. been obtained from sources deemed reliable and no representation is made as to the The figures provided for the current quarter are preliminary, and all information contained in accuracy thereof. Cassidy Turley is a leading the report is subject to correction of errors and revisions based on additional data received. commercial real estate services provider, with 455 million square feet managed on behalf of institutional, private and corporate clients Explanation of Terms and $22 billion in completed transactions Total Inventory: The total amount of office space (in buildings greater than 10,000 square for 2011. feet) that can be rented by a third party. Total Space Available: The sums of new, relet, and sublet space that is unoccupied and being actively marketed. Vacancy Rate: The amount of unoccupied space (new, relet, and sublet) expressed as a percentage of total inventory. (Total Unoccupied Space divided by Total Inventory.) Absorption: The net change in occupied space between two points in time. (Total occupied space in the previous quarter minus total occupied space in the present quarter, quoted on a net, not gross, basis.) Asking Rents: Gross average asking rents.Regional Map West Midwest South Northeast14 | Cassidy Turley
  15. 15. A Leader in Commercial Real Estate ServicesKey At Cassidy Turley, we are market leaders, industry leaders and community leaders.Statistics Nationwide, clients recognize us for the creative sophistication of our real estate advice as well as for the discipline and accuracy of our service delivery. We are a trusted partner and advocate, supporting our clients’ overall business performance. In markets across the country, we are respected as a leading provider of commercial real estate services as well• More than 60 U.S. offices as for our community engagement. Our thorough understanding of local business practices• 65 international offices* and market dynamics, combined with our customer focus and service commitment, give our• More than 3,500 professionals clients a distinct edge in commercial real estate across the globe.• More than 900 brokers Local Market Leaders, Nationwide• 2011 transactions • Our professionals have deep ties to our communities and our industry, and a thorough – Gross transaction volume understanding of local business leaders and practices, giving Cassidy Turley and our $22 billion clients an edge. – Gross capital markets • Our in-depth, local market knowledge provides a comprehensive understanding of volume $10.3 billion market dynamics and enables us to effectively forecast market trends – providing• 455 million sf managed insight to clients and helping them make informed real estate decisions. portfolio • Our leadership position is recognized in the communities we serve. We are often rated• More than 28,000 client in local business journals as a “Best Place to Work,” and are honored for our many locations served local philanthropic efforts.*Through GVA Partnership Industry Leadership • Named to Leaders List of 2012 Global Outsourcing 100 • Over 80% of real estate executives familiar with our brand ranked it Very Good or Excellent – Wall Street Journal survey • Ranked in the Top Five in Best Practices Index – Commercial Property Executive • Platinum ranking in Greenest Companies Index – Commercial Property Executive • Top 5 in Office Sales over $25 Million Nationwide – Real Estate Alert World-Class Expertise • Many of our associates have honed their skills in their respective markets for years – even decades – gaining an understanding of industry best practices and serving as thought leaders. • Cassidy Turley has served clients’ needs outside of the United States since 1985. In order to better serve our clients in Europe and Asia-Pacific, Cassidy Turley is proud to partner with GVA, the founder and majority shareholder of GVA Worldwide, which serves key markets in over 25 countries cassidyturley.com

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