An in-depth look at the Cleveland office market. Analysis includes leasing, sales, construction and employment.

1. JLL Research
Cleveland | Q1 2018
Office Outlook
An in-depth look at the Cleveland office
market. Analysis includes leasing, sales,
construction and employment.

2. Q1 2018
Insight
Cleveland Office Outlook
More than 300,000 square feet of speculative office space is set to deliver in
the second quarter of 2018. This is an extraordinary amount of new product
for the Cleveland market, which hasn’t seen any speculative office
development since 2013 when the Ernst & Young Tower opened in the Flats.
The new office space is split between four developments, two in Midtown and
two in the East submarket. The two buildings in Midtown, Link 59 and the
Phoenix building, are being developed by Hemingway. While in the East
submarket, the Van Aken and Pinecrest projects are being developed by RMS
and Fairmount, respectively. These developments are roughly 50.0 percent
preleased and we expect commitment levels to rise in the near future as these
developments open for business and tenants are able to tour the buildings.
While tenants are being presented with new options in the suburbs, options
downtown are dwindling, and vacancy in the city center is set to get even
tighter this spring. Forest City is preparing to relocate its headquarters into
148,000 square feet at Key Tower. The move will represent an upgrade for
Forest City and the space it leaves behind will be converted to residential use.
In addition, downtown is preparing to welcome two new tenants from the
suburbs. NRP leased 41,000 square feet at the Halle building and Electronic
Merchant Systems will move into 45,000 square feet at 250 W Huron.
Outlook
Employment growth and office demand will continue in positive territory in
2018. However, with 300,000 square feet of speculative office space set to hit
the market, we see vacancy ending the year relatively unchanged around 19.0
percent. Demand will remain weighted towards Class A assets, as tenants are
increasingly willing to pay a premium for brand visibility, amenities, and
operational efficiencies. Rents will continue to appreciate gradually in the 1.0
to 3.0 percent range as the market tightens and owners reposition assets.
Lastly, look for investment activity to remain elevated across the metro with
more than 5.0 million square feet of product on the market.
Fundamentals Forecast
YTD net absorption 133,236 s.f. ▲
Under construction 306,000 s.f. ▼
Total vacancy 19.3% ▶
Average asking rent (gross) $19.35 p.s.f. ▲
Concessions Stable ▼
-350,000
-175,000
0
175,000
350,000
2015 2016 2017 Q1 2018
Supply and demand (s.f.) Net absorption
Deliveries
Speculative construction will test the market this spring
21.4%
20.7%
19.8%
19.3%
2015 2016 2017 Q1 2018
Total vacancy
$15.00
$18.00
$21.00
$24.00
2015 2016 2017 Q1 2018
Average asking rents ($/s.f.) Class A
Class B
Top trends
• More than 300,000 square feet of speculative office space will hit the
market this spring. Preleasing currently stands around 50.0 percent.
• Planned moves by Forest City, NRP, Electronic Merchant Systems and
others will tighten vacancy downtown, giving landlords more leverage.
• Supply and demand will be balanced in 2018. Vacancy will end the year
around 19.0 percent with rent gains between 1.0 and 3.0 percent.
© 2018 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.

3. Statistics
The Midtown submarket was added to the published statistics this quarter. Additional updates to the property set were made based on market dynamics.
© 2018 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Cleveland Office Outlook
Q1 2018
Class
Inventory
(s.f.)
Total net
absorption
(s.f.)
YTD total net
absorption
(s.f.)
YTD total net
absorption
(% of stock)
Direct
vacancy (%)
Total
vacancy (%)
Average
direct asking
rent ($p.s.f.)
YTD
completions
(s.f.)
Under
construction
(s.f.)
CBD Totals 15,461,891 19,252 19,252 0.1% 20.0% 21.0% $19.70 0 0
Midtown Totals 935,478 109,519 109,519 11.7% 10.4% 11.4% $18.80 0 90,000
Urban Totals 16,397,369 128,771 128,771 0.8% 19.5% 20.4% $19.67 0 90,000
Northeast Totals 546,792 7,592 7,592 1.4% 23.5% 23.5% $15.81 0 0
East Totals 3,912,123 15,977 15,977 0.4% 13.0% 13.4% $21.68 0 216,000
Southeast Totals 992,906 -497 -497 -0.1% 12.8% 21.8% $18.64 0 0
South Totals 4,858,334 -10,039 -10,039 -0.2% 17.0% 18.9% $18.77 0 0
Southwest Totals 1,096,322 8,984 8,984 0.8% 29.7% 29.7% $18.35 0 0
West Totals 1,687,238 -17,552 -17,552 -1.0% 14.0% 14.0% $17.17 0 0
Suburban Totals 13,093,715 4,465 4,465 0.0% 16.4% 18.0% $18.99 0 216,000
Cleveland Totals 29,491,084 133,236 133,236 0.5% 18.1% 19.3% $19.35 0 306,000
CBD A 5,854,816 -15,094 -15,094 -0.3% 13.1% 13.8% $23.77 0 0
Midtown A 201,356 7,873 7,873 3.9% 5.5% 9.8% $23.00 0 60,000
Urban A 6,056,172 -7,221 -7,221 -0.1% 12.8% 13.7% $23.75 0 60,000
East A 1,888,209 6,112 6,112 0.3% 10.0% 10.5% $24.83 0 216,000
Southeast A 241,105 0 0 0.0% 0.1% 35.9% $23.00 0 0
South A 1,839,945 8,428 8,428 0.5% 17.4% 20.5% $21.66 0 0
Southwest A 88,000 0 0 0.0% 16.1% 16.1% $0.00 0 0
West A 594,777 19,322 19,322 3.2% 5.7% 5.7% $18.00 0 0
Suburban A 4,652,036 33,862 33,862 0.7% 12.0% 15.3% $22.49 0 216,000
Cleveland A 10,708,208 26,641 26,641 0.2% 12.5% 14.4% $23.15 0 276,000
CBD B 9,607,075 34,346 34,346 0.4% 24.2% 25.3% $18.56 0 0
Midtown B 734,122 101,646 101,646 13.8% 11.8% 11.8% $18.27 0 30,000
Urban B 10,341,197 135,992 135,992 1.3% 23.4% 24.3% $18.55 0 30,000
Northeast B 546,792 7,592 7,592 1.4% 23.5% 23.5% $15.81 0 0
East B 2,023,914 9,865 9,865 0.5% 15.7% 16.1% $19.79 0 0
Southeast B 751,801 -497 -497 -0.1% 16.9% 17.3% $18.62 0 0
South B 3,018,389 -18,467 -18,467 -0.6% 16.7% 18.0% $17.74 0 0
Southwest B 1,008,322 8,984 8,984 0.9% 30.9% 30.9% $18.20 0 0
West B 1,092,461 -36,874 -36,874 -3.4% 18.5% 18.5% $17.03 0 0
Suburban B 8,441,679 -29,397 -29,397 -0.3% 18.8% 19.4% $18.00 0 0
Cleveland B 18,782,876 106,595 106,595 0.6% 21.3% 22.1% $18.29 0 30,000

4. Q1 2018
Construction
Cleveland Office Outlook
1
Development: Link 59
Square feet: 60,000
Tenant(s): MCPc, et al.
Owner: Hemingway
Construction type: Spec
Completion: Q2 2018
1
2
Development: Phoenix Building
Square feet: 30,000
Tenant(s): Infinite Arthroscopy, et al.
Owner: Hemingway
Construction type: Spec
Est. completion: Q2 2018
3
4 5
3
Development: Pinecrest
Square feet: 150,000
Tenant(s): Alliance Prime, et al.
Owner: Fairmount
Construction type: Spec
Est. completion: Q2 2018
4
Development: Van Aken
Square feet: 66,000
Tenant(s): ABA, RMS, et al.
Owner: RMS
Construction type: Spec
Est. completion: Q2 2018
This map highlights a partial list of construction projects either planned, under construction, or recently completed.
© 2018 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
5
Development: Highlands Center
Square feet: 47,000
Tenant(s): Glenmede, et al.
Owner: Palmieri
Construction type: Spec
Completion: Q4 2017
2
1
Development: Link 59
Square feet: 60,000
Tenant(s): MCPc, et al.
Owner: Hemingway
Construction type: Spec
Completion: Q2 2018
4
Development: Van Aken
Square feet: 66,000
Tenant(s): ABA, RMS, et al.
Owner: RMS
Construction type: Spec
Est. completion: Q2 2018

5. Q1 2018
Leasing
Cleveland Office Outlook
This dashboard analyzes leasing activity ≥ 5,000 square feet over a 12 month period, ending March 31, 2018.
© 2018 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
95
670,323
644,616
153,998
993,413
475,524
Growing Shrinking Stable
717,171
751,766
Notable leasing transactions
Submarket Size
Benesch 200 Public Sq CBD
The Revenue Group 3711 Chester Ave Midtown
Cleveland-Cliffs 200 Public Sq CBD
Western Reserve 1701 E 12th St CBD New lease Stable
Walter Haverfield 1301 E 9th St CBD Renewal Growing
Electronic Merchant Systems 250 W Huron Rd CBD New lease Growing
HIMSS 1 Saint Claire Ave CBD Renewal Stable
Bank of America 1375 E 9th St CBD Renewal Growing
Cleveland Cavaliers 250 W Huron Rd CBD New lease Stable
Victory Capital Management 4900 Tiedeman Rd Southwest Renewal Shrinking
Type
Leasing activity by transaction type
New lease
Renewal
Tenant Address Footprint
Tenant footprint Leasing activity by industry
22 7 66
Class B leasing (s.f.)
Class C leasing (s.f.)
Number of transactions
Class A leasing (s.f.)
Suburban leasing (s.f.)
Downtown leasing (s.f.)
120,088
69,223
63,886
57,000
53,711
45,000
43,000
32,817
29,946
28,481
Stable
Growing
ShrinkingRenewal
New lease
Renewal
26%
22%
17%
14%
12%
6% Financial services
Legal services
Professional and business services
Public andprivateinstitutions
Scientific and technical
Real estate
Other
75 13 4 2 1
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
5,000-19,999 20,000-39,999 40,000-59,999 60,000-79,999 80,000+
Leasing activityby submarket (s.f.)
60%
11%
8%
8%
7%
CBD
South
East
Midtown
West
Southwest
Northeast
Southeast
Leasing activityby industry (s.f.)

6. 19%
18%
14%13%
12%
9%
7%
Educational & Health Services
Trade, Transportation & Utilities
Professional & Business Services
Government
Manufacturing
Leisure & Hospitality
Financial Activities
Other Services
Mining, Logging & Construction
Information
Q1 2018
Employment
Cleveland Office Outlook
4.1%U.S. unemployment
1.7%U.S. 12-month job growth
5.6%Cleveland unemployment
0.1%Cleveland 12-month job growth
4.7%Ohio unemployment
0.4%Ohio 12-month job growth
-0.5%
0.2%
0.9%
1.6%
2.3%
3.0%
2013 2014 2015 2016 2017 2018
Cleveland U.S.
3,800
1,800
400
200
100
-100
-200
-800
-1,600
-2,600
-4,800-3,800-2,800-1,800 -800 200 1,200 2,200 3,200 4,200
Manufacturing
Trade, Transportation & Utilities
Financial Activities
Educational & Health Services
Government
Information
Other Services
Mining, Logging & Construction
Professional & Business Services
Leisure & Hospitality
-5.0
0.0
5.0
10.0
2013 2014 2015 2016 2017 2018
Professional & Business Services Information
Government Financial Activities
0%
4%
8%
12%
900,000
1,000,000
1,100,000
2013 2014 2015 2016 2017 2018
Employment Unemployment
Employment vs. unemployment rate
Employment by industry Office employment trends (12-month change, 000s)
Job growth by sector (12-month change)
Job growth (12-month change)
Job growth by sector (12-month change)
These charts display the latest economic data available from the Bureau of Labor Statistics as of March 2018
© 2018 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.

7. About JLL
JLL (NYSE: JLL) is a leading professional services firm that
specializes in real estate and investment management. A
Fortune 500 company, JLL helps real estate owners,
occupiers and investors achieve their business ambitions. In
2017, JLL had revenue of $7.9 billion and fee revenue of $6.7
billion; managed 4.6 billion square feet; and completed
investment sales, acquisitions and finance transactions of
approximately $170 billion. At the end of 2017, JLL had
nearly 300 corporate offices, operations in over 80 countries
and a global workforce of 82,000. As of December 31, 2017,
LaSalle had $58.1 billion of real estate assets under
management. JLL is the brand name, and a registered
trademark, of Jones Lang LaSalle Incorporated. For further
information, visit www.jll.com.
About JLL Research
JLL’s research team delivers intelligence, analysis and
insight through market-leading reports and services that
illuminate today’s commercial real estate dynamics and
identify tomorrow’s challenges and opportunities. Our more
than 400 global research professionals track and analyze
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conditions in over 60 countries, producing unrivalled local
and global perspectives. Our research and expertise, fueled
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world, creates a competitive advantage for our clients and
drives successful strategies and optimal real estate
decisions.
Contact
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Executive Vice President
+ 1 216 937 4394
brian.conroy@am.jll.com
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Managing Director
+ 1 216 937 4384
scott.pick@am.jll.com
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+1 216 937 4379
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+1 216 937 4374
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© 2018 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.