2012 eoy industrial-office

Commercial Real Estate Services, Worldwide.A division of KLNB, founded in 1968.

2012 IndustrIal & OffIce Market repOrt

Baltimore/Washington, DC CorriDor

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HOWARD

ANNEARUNDEL

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MARYLAND

2012 YEAR END REVIEW

Economic uncErtainty rElatEd to sEquEstration, job growth and national financial dEbatE causing

companiEs to dEfEr rEal EstatE dEcisions

Despite the election outcome, businesses find it extremely difficult to make decisions affecting the short or long-term future of their companies when they have uncertainty about economic conditions. Uncertainty impacts hiring, the purchase of new equipment, inventory and real estate decisions including signing a lease or purchasing a building. Both nationally and throughout the Baltimore-Washington, D.C. Corridor marketplace, the heavy feeling of “uncertainty” remains fueled by the anticipated sequestration, pending outcome of the Fiscal Cliff, the unsettled European markets, the direction of the job market, and a solution to the national debt.

This overwhelming theme is causing companies and organizations to “freeze up”, access the situation and defer real estate situations until more clarity is defined. Other factors related to commercial real estate are contributing to the collective decision to hit the “pause” button, such as the renewed popularity of telecommuting, job sharing, cloud commuting and collaborated office space environments as well as the renewed emphasis on New Urbanism and reliance on modes of public transportation.

Pessimistic conditions are mirrored in the investment sales sector as potential buyers predict depressed or flat rental rates and prolonged leasing periods. Many forecast that improvement is not expected to occur until 2015 or 2016. There remains investor interest among bulk warehouse, institutional-quality office buildings in core markets, grocery-anchored retail and multi-family housing. Apartments are the shining star among all real estate product types.

Conversely, there are also many reasons to be optimistic about 2013, especially within this marketplace which time and again has

IN THIS ISSUE:

2012 YEAR END REVIEW 2

INDUSTRIAL MARKET OVERVIEW 4

OFFICE MARKET OVERVIEW 5

INDUSTRIAL REPORT

HOWARD COUNTY MAP 6 Howard County 7 U.S. Route 1 Corridor 8 Columbia 9

ANNE ARUNDEL COUNTY MAP 10 Anne Arundel County 11 BWI 12 Marley Neck/Glen Burnie 13 Odenton 14 PRINCE GEORGE’S COUNTY MAP 15 Prince George’s County 16 Inner Beltway 17 Outer Beltway 18 Northern Prince George’s County 19

OFFICE REPORT

HOWARD COUNTY MAP 20 Howard County 21 Columbia North 22 Columbia South 23 Columbia Town Center 24 ANNE ARUNDEL COUNTY MAP 25 Anne Arundel County 26 Annapolis 27 BWI Corridor 28

RESIDENTIAL LAND 29

INVESTMENT OVERVIEW 30

PARAGON, SIOR, CCIM &NAI KLNB SERVICES 31

THE NAI KLNB TEAM 32

2012 YEAR END REVIEW

proven to be extremely resilient, with an extended track record of success. Our proximity to the Federal Government, the just-concluded BRAC expansion at Fort Meade, overall industry diversity and the emerging cyber-security initiatives remain powerful economic drivers. These reasons include: Minimization of sequestration: An anticipated 10% spending cut in the federal budget including the Department of Defense would inflict a painful dent in the Maryland economy, including all real estate sectors. There exists behind-the-scenes lobbying efforts to reduce these cuts and its relative impact on our region. Rapid resolution of the Fiscal Cliff: As of this writing, negotiations were also in play to minimize the effect of the so-called Fiscal Cliff related to payroll tax cuts and Bush tax cuts that are projected to remove approximately $700 billion from our country’s economy. A quick resolution would start 2013 off on the right note. Continued growth of cyber-security initiatives: Commercial real estate activities - particularly surrounding Fort Meade in Anne Arundel County - are centered around emerging cyber-security initiatives, with this sector viewed as the knight in shining armor and replacement to BRAC expansion. Numerous local universities have initiated cyber-security curriculum, adding additional optimism about long-term prospects.

Intelligence Community contracts: More than $500 million worth of contracts for Intelligence Community work, much of this emanating from the Annapolis Junction Revenue Support Field Office, is expected to flow into the State’s economy. The commercial real estate industry is expected to be a major beneficiary.

The commercial real estate sector is still keeping its eye on other trends and situations with potential significant impact on our business. This includes the formation or reduction of jobs in the State of Maryland (which is always a primary indicator in the direction of our industry); office space downsizing and the conversion of office space to a “collaborated” environment causing smaller footprints; and the shift to “cloud commuting” which creates less demand for on-site computer server rooms.

The only truly thing certain about the state of commercial real estate and the investment sales marketplace in the State of Maryland is its uncertainty. And, because businesses abhor these conditions, a state of paralysis has set in. Like everything else in life “this too will pass” and we can expect the overall economic might of the Baltimore-Washington Corridor to keep this region on the relative top-end of the national real estate barometer.

3

BALTIMORE-WASHINGTON CORRIDOR

2012 Industrial Market Overview

MARKET # OF BUILDINGS

RBA TOTAL VACANT (SF)

TOTAL VACANCY RATE %

ABSORPTION RENTAL RATEPSF (AVERAGE)

CONSTRUCTION COMPLETIONS (SF)

HOWARD COUNTY

Total Bulk 160 22,869,910 3,448,611 14.9% 219,904 $4.63 0

Total Office/Warehouse 199 9,543,343 1,240,258 12.7% (180,538) $7.11 0

Total Flex 134 5,438,156 720,050 13.2% (39,349) $9.42 0

U.S. Route 1 Corridor

Bulk 136 18,539,682 2,728,493 14.5% 111,557 $5.15 0

Office/Warehouse 157 7,083,390 867,536 11.8% (197,151) $5.72 0

Flex 20 703,971 93,678 13.3% (23,320) $7.33 0

Columbia

Bulk 24 4,330,228 720,118 16.6% 108,347 $4.10 0

Office/Warehouse 42 2,459,953 372,722 15.2% 16,613 $8.50 0

Flex 114 4,734,185 626,372 13.2% (16,029) $11.50 0

ANNE ARUNDEL COUNTY

Total Bulk 110 14,800,000 1,817,000 12.2% 14,000 $4.45 0

Total Office/Warehouse 92 5,393,000 650,000 12.1% 60,500 $4.95 0

Total Flex 231 9,600,000 998,000 10.6% 337,000 $5.75 0

BWI

Bulk 45 6,261,316 1,025,465 16.4% 67,871 $5.98 0


Flex 74 3,093,868 449,707 14.5% 43,291 $9.47 0

Marley Neck/Glen Burnie

Bulk 31 5,585,000 233,000 4.2% (128,000) $4.15 0

Office/Warehouse 26 1,194,000 151,000 12.7% (11,000) $4.25 0

Flex 41 1,398,000 69,000 4.9% 47,000 $5.45 0

Odenton

Bulk 12 1,800,000 620,000 34.4% (216,000) $4.25 0

Office/Warehouse 7 142,000 31,680 22.4% (31,680) $5.95 0

Flex 11 535,000 184,200 34.4% (156,100) $6.95 0

PRINCE GEORGE’S COUNTY

Total Bulk 236 20,514,382 1,979,821 9.7% 996,275 $5.90 69,567

Total Office/Warehouse 346 18,045,423 1,743,555 9.7% 517,941 $6.09 0

Total Flex 589 20,788,975 2,484,725 11.9% 335,999 $6.13 0

P.G. County Inner Beltway

Bulk 153 13,030,937 1,252,322 9.6% 684,431 $5.53 0


Flex 294 7,992,507 673,725 8.4% (117,951) $6.56 0

P.G. County Outer Beltway

Bulk 36 4,128,011 452,350 11.0% 139,101 $6.82 69,567


Flex 134 7,378,572 1,093,195 14.9% 376,779 $5.84 0

Northern P.G. County

Bulk 47 3,355,434 275,160 8.2% 172,743 $6.83 0


Flex 162 5,411,119 763,035 14.1% 20,651 $7.88 0

COUNTIES & SUBMARKETS

3

BALTIMORE-WASHINGTON CORRIDOR

2012 Office Market Overview

MARKET # OF BUILDINGS

RBA TOTAL VACANT (SF)

TOTAL VACANCY RATE %

ABSORPTION RENTAL RATEPSF (AVERAGE)

CONSTRUCTION COMPLETIONS (SF)

HOWARD COUNTY

Total Class A 67 6,851,798 1,110,103 16.2% 108,242 $24.76 110,000

Total Class B 236 8,902,928 951,113 10.6% 168,635 $22.00 161,399

Columbia North

Class A 10 747,483 157,114 21.0% (37,123) $24.42 0

Class B 36 1,288,656 125,611 9.8% 84,717 $23.09 68,779

Columbia South

Class A 40 4,341,322 890,444 20.5% 58,911 $25.14 110,000

Class B 102 4,459,591 582,001 13.0% 21,416 $22.39 42,620

Columbia Town Center

Class A 15 1,692,593 176,131 10.4% 104,115 $24.05 0

Class B 20 855,848 120,774 14.1% 10,903 $22.77 0

ANNE ARUNDEL COUNTY

Total Class A 93 8,532,092 972,518 11.4% 304,838 $27.84 207,830

Total Class B 247 7,675,301 1,046,154 13.7% (13,054) $21.43 0

Annapolis

Class A 32 2,099,024 233,324 11.2% 19,140 $30.00 0

Class B 96 2,801,662 305,746 10.9% 11,943 $24.75 0

BWI Corridor

Class A 48 5,763,490 603,861 10.0% 260,000 $28.00 207,830

Class B 53 2,657,695 500,597 18.8% (24,000) $21.00 0

COUNTIES & SUBMARKETS

Office Building Criteria: Rentable building area equal to or greater than 10,000 gross square feet; multi-story and single story buildings. Vacancy rates are based on existing office space that is currently unoccupied; however, lease documentation may exist for all or a portion of such space.

5

CLARKSVILLEMontgomery

County

Prince George’sCounty

Anne ArundelCounty

BaltimoreCounty

FrederickCounty

Carroll County

HOWARD COUNTY

US ROUTE 1 CORRIDOR

COLUMBIA

SUBMARKETS

70

70

95108

144

32

144

100

3297

29

1

32

29

COLUMBIA

LAUREL

ELKRIDGE

ELLICOTTCITY

JESSUP

HOWARD COUNTYIndustrial Submarket Map

6

MARKET OVERVIEW

Overall, Howard County’s industrial market remained relatively flat for 2012. Industrial vacancy remained at 14.3% with a slight negative absorption of +40,000 square feet. Class A and B space continues to have a respectable tenant velocity with accompanying leases executed. Several of those are indicated on the following page. However, the Class C product will continue to lag the overall vacancy primarily due to lower ceilings and inadequate loading. Owner occupied sales continue to be very strong primarily due to the availability of funds. There were ample lender programs available to those who purchased during 2012 as well as the Small Business Administration 504 loan. Several lenders offered interest rates below 4%. While many developers would like to deliver industrial product in Howard County in 2013, there remains very little industrial property that can be developed based on current market rents. With few “engineered” sites that have become available, rental rates would need to exceed $6.25 per square foot, NNN.

MARKET OUTLOOK

Due to the lack of development, the Class A space vacancy rate will continue to be in the single digits with Class B and C space in the low teens. Class A rates will remain in the $5.00 to $6.00 per square foot, NNN, range. We will see at times a 30% differential between Class A and C industrial space as the Class C space becomes more difficult to lease over time. Our expectation will be that Class C buildings will see redevelopment in the relatively near future as development costs continue to increase.

howardcounty

HOWARD COUNTYIndustrial

HOWARD COUNTY SIGNIFICANT ACTIVITY

SELECTED LEASING TRANSACTIONS Tenant Address SF Class/ Product Average Rental Rate PSF BMG Metals 6945 San Tomas Road 72,240 Class B, Bulk $4.36, NNN Rapid Response 8705 Bollman Place 72,000 Class B, Bulk $4.55, NNN Parts Channel Inc 10650 Riggs Hill Road 58,710 Class B, Bulk $4.67, NNN Valley Relocation 8155 Stayton Drive 53,185 Class B, Bulk $3.95, NNN Ryder Integrated Logistics 8240 Preston Court 46,555 Class B, Bulk $5.75, NNN My Office Products 8750 Larkin Road 42,545 Class B, Bulk $4.56, NNN Prestige Beverage 6735 Business Parkeay 40,500 Class A, Bulk $4.95, NNN Creative Recycling Systems 7090 Troy Hill Drive 41,600 Class A, Bulk $5.15, NNN

7

STATISTICS

Building Product Bulk Office/Warehouse Flex

Number of Buildings 160 199 134

New/Relet Vacant (SF) 3,416,511 1,208,854 522,918

Sublease Vacant (SF) 32,100 31,404 197,132

Total Vacant (SF) 3,448,611 1,240,258 720,050

Total Existing RBA (SF) 22,869,910 9,543,343 5,438,156

Vacancy Rate Direct % 14.9% 12.7% 9.6%

Vacancy Rate Sublease % .01% .03% 3.6%

Net Absorption (SF) 219,904 (180,538) (39,349)

Average Rental Rate (NNN) $4.63 $7.11 $9.42

2012 Completed Construction SF 0 0 0

2013 Planned Construction SF 82,000 115,000 33,337

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Howard County – Industrial 12/26/12

Vacancy Rate

Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-700-600-500-400-300-200-100

0100200300

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory

Bulk 60 Office/Whs 25 Flex 15

Average Asking Rental Rate

$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00

2008 2009 2010 2011 2012

Average Rental Rate PSF, NNN


Vacancy Rate

Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-700-600-500-400-300-200-100

0100200300

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00

2008 2009 2010 2011 2012

Market Inventory (%)

BulkOffice/WhsFlex

60%25%

15%

Howard County - Industrial

US ROUTE 1 CORRIDOR


SELECTED BUILDING SALES - INVESTMENT Address Size Price Price PSF Product Buyer Seller US Central Portfolio 65 Prop. $770,000,000 Varies Industrial Blackstone R.E. Partners VI Dexus Prop. Group 7481 Coca Cola Drive 456,500 SF $40,644,173 $89.03 Whs Industrial Income Trust Lincoln Property Co. 7075-7081 Oakland Mills Rd 444,765 $20,700,000 $46.54 Whs TA Associates Realty Emory Properties 7125 Troy Hill Drive 30,000 SF $6,768,446 $103.04 Whs Terreno Realty Corporation Ryan Commercial SELECTED BUILDING SALES - USER Address Size Price Price PSF Product Buyer Seller 7010 Troy Hill Road 30,000 $4,000,000 $133.33 Whs/Showroom FESCO Emergency Sales Brandy, LLC 6650 Santa Barbara Road 40,700 $2,700,000 $66.34 Flex S&H Flooring Lynott & Lynott 9620 & 9630 Gerwig Lane 61,320 $2,500,000 $40.77 Whs Metropolitan Rolling Door Emory Properties 7410 Coca Cola Drive 3,883 $688,000 $177.18 Whs/Condo Joseph Gagnier Mid Atlantic Beauty

STATISTICS



New/Relet Vacant (SF) 2,696,393 836,132 88,158


Total Vacant (SF) 2,728,493 867,536 93,678

Total Existing RBA (SF) 18,539,682 7,083,390 703,971


Vacancy Rate Sublease % .02% .04% 0.8%

Net Absorption (SF) 111,557 (197,151) (23,320)



2013 Planned Construction SF 82,000 0 33,337

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

US Route 1 – Industrial 12/10/12

Vacancy %

Net Absorption

0%

2%

4%

6%

8%

10%

12%

14%

16%

2008 2009 2010 2011 2012

-500-400-300-200-100

0100200300400500

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory


Average Asking Rental Rate (PSF)

$0.00

$1.00

$2.00

$3.00

$4.00

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$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012



Vacancy %

Net Absorption

0%

2%

4%

6%

8%

10%

12%

14%

16%

2008 2009 2010 2011 2012

-500-400-300-200-100

0100200300400500

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

70%

27%

3%

8

Howard County - Industrial

COLUMBIA


2013 PLANNED CONSTRUCTION Address SF Product Asking Rent PSF Delivery Date Owner/Developer 8235 Patuxent Range Road 250,000 Bulk TBD 2013 4Q Chesapeak R.E. Group Dorsey Run Road 200,000 Bulk TBD 2013 3Q FODay Weiland Snowden River Parkway 115,000 Off/Whs TBD 2013 3Q Sanford Companies 7221 Montevideo Road 33,337 Flex TBD 2013 2Q Gaulin Properties LLC 8810 Corridor Road 32,000 Off/Whs TBD 2013 3Q Corridor Road, LLC 7587 Montevideo Road 25-80,000 Whs $6.75, NNN 2013 1Q Exeter

BUILDINGS DELIVERED IN 2012 - NONE REPORTED

SELECTED LAND SALES - INVESTMENT - NONE REPORTED

STATISTICS



New/Relet Vacant (SF) 720,118 372,722 434,760

Sublease Vacant (SF) 0 0 191,612

Total Vacant (SF) 720,118 372,722 626,372



Vacancy Rate Sublease % 0% 0% 4%

Net Absorption (SF) 108,347 16,613 (16,029)



2013 Planned Construction SF 0 115,000 0

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Columbia – Industrial 12/10/12

Vacancy %

Net Absorption (SF)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

2008 2009 2010 2011 2012

-1,200-1,000

-800-600-400-200

0200400600

2008 2009 2010 2011 2012

thou

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s

Vacancy Rate (%)


Market Inventory



$0.00

$2.00

$4.00

$6.00

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$14.00

2008 2009 2010 2011 2012



Vacancy %

Net Absorption (SF)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

2008 2009 2010 2011 2012

-1,200-1,000

-800-600-400-200

0200400600

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

38%41%

21%

9

BWI AIRPORT

MARLEY NECK/GLEN BURNIE

HowardCounty


To Chesapeake Bay Bridge

Calvert County

Ches

apea

ke B

ay

Baltimore

ANNAPOLIS

PASADENA

CROFTON

BWIAIRPORT

SEVERN

ODENTON

SUBMARKETS

ODENTON PARKSEVERNA

HANOVER

FORTMEADE

GLEN BURNIE

97

97

214

2

50

50

23

32

2

2

100

295

175

ANNE ARUNDEL COUNTYIndustrial Submarket Map

10

annE arundElcounty

MARKET OVERVIEW

Although the mind-set of the general industrial real estate market remained cautious, transactional activity in the Anne Arundel submarket was quite positive. Vacancy rates lowered this year, settling in at just under 11% at the end of 2012, while net absorption went into significant positive territory for the first time in several years, with more than 400,000 square feet in gains. Several firms, including Mohawk, Rommel Engineering, and Advantage Flooring either expanded into or renewed their commitment to Anne Arundel County in 2012.

Anne Arundel County remains one of the strongest commercial real estate markets within the Baltimore Metropolitan Area due its diverse economic base, excellent transportation network and proximity to both Baltimore and Washington. The county has a strong median household income of just over $82,000 and the current unemployment rate is under the national average at 5.6%. The Department of Defense continues to be its single largest employer and BWI Airport, which continues to set records for passenger traffic, is going through a major $100 million expansion including security improvements, passenger amenities and larger commercial space.

MARKET OUTLOOK

Anne Arundel maintains a strong mix of economic drivers, including the federal government, BWI Airport, and the expanding fields of medical, technical and security fields, and these drivers moved the county forward in 2012. We believe these strengths will continue to pay dividends for commercial real estate in 2013, as companies maintain efforts to strengthen their balance sheets and business improves throughout the region. Although there will be some initial caution in the early part of 2013 due to potential expiration of the Bush tax cuts and the impending “fiscal cliff”, the flow of business should pick up once these issues have been resolved. The county made significant strides in 2012 due to the addition of jobs and income through the BRAC initiative, expansion of BWI, and the growth of many of its home grown companies, 27 of which have been named among the fastest growing in the country. There continues to be very little new speculative industrial construction and that will further stabilize rental rates, reduce vacancy and increase annual absorption in 2013.

ANNE ARUNDEL COUNTYIndustrial

11

ANNE ARUNDEL COUNTY SIGNIFICANT ACTIVITY

SELECTED LEASING TRANSACTIONS Tenant Address SF Product Avg Rental Rate PSF Powercon 1731 Midway Road 75,000 Bulk $4.00, NNN NB Handy Company 7495 Race Road 69,564 Bulk $5.75, NNN Terry’s Tire Town 1780 Crossroads Drive 45,000 Bulk $5.00, NNN Grid One Solutions 6711 Baymeadow Drive 42,000 Flex $4.50, NNN Beyond The Label 7600 Energy Parkway 33,748 O/W $4.75, NNN Sotech 12011 Guilford Road 18,184 O/W $5.75, NNN Solara Flooring Group 12011 Guilford Road 10,400 O/W $6.00, NNN Lighthouse Church 100 Langley Road 7,000 Flex $6.50, NNN Eastern Antenna Alignment 7609 Energy Parkway 3,970 Flex $6.25, NNN

STATISTICS




Sublease Vacant (SF) 164,000 0 16,000

Total Vacant (SF) 1,817,000 650,000 998,000



Vacancy Rate Sublease % 1.1% 0% 0.2%

Net Absorption (SF) 14,000 60,500 337,000



2013 Planned Construction SF 250,000 0 0

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Anne Arundel County – Industrial 12/10/12

Vacancy Rate

0%

2%

4%

6%

8%

10%

12%

14%

16%

2008 2009 2010 2011 2012

Absorption

-500

-400

-300

-200

-100

0

100

200

300

400

2008 2009 2010 2011 2012

thou

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s

Vacancy Rate (%)


Market Inventory



$0.00

$2.00

$4.00

$6.00

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$10.00

$12.00

2008 2009 2010 2011 2012



Vacancy Rate

0%

2%

4%

6%

8%

10%

12%

14%

16%

2008 2009 2010 2011 2012

Absorption

-500

-400

-300

-200

-100

0

100

200

300

400

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



BulkOffice/WhsFlex

49%

18%

33%

Anne Arundel County - Industrial

BWI AIRPORT


SELECTED BUILDING SALES - INVESTMENT Address SF Price Price PSF Product Buyer Seller 7462 Candlewood Rd 375,344 $23,695,000 $63 Bulk Teachers Insurance COPT 7621 Energy Parkway 222,636 $15,225,000 $68 Bulk ITT Brandon Wood High St. Equity 7463 New Ridge Road 198,369 $11,650,000 $59 Bulk ITT Brandon BWI Ctr II Bavar Prop Group 7495 Race Road 125,000 $8,250.000 $66 Bulk Exeter Properties Preston Derbry LLCSELECTED BUILDING SALES - USER Address SF Price Price PSF Product Buyer Seller 7240 Standard Drive 30,175 $1,837,500 $61 O/W Advantage Flooring Groco 7135 Standard Drive 10,783 $1,310,000 $121 O/W Tidewater Glazing Trugreen Landcare 701 Pittman Road 10,985 $1,300,000 $118 Bulk Nova Services J. Lomma Inc

STATISTICS




Sublease Vacant (SF) 164,216 0 12,840

Total Vacant (SF) 1,025,465 332,600 449,707



Vacancy Rate Sublease % 2.6% 0% 0.4%




2013 Planned Construction SF 250,000 0 51,120

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

BWI Airport – Industrial 12/17/12

Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-200

-100

0

100

200

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012



Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-200

-100

0

100

200

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

55%

18%

27%


MARLEY NECK/GLEN BURNIE


SELECTED LAND SALES - INVESTMENT Address Size Price Price/Acre Product Buyer Seller 3366 Fort Meade Road 20 AC $2,500,000 $125,000 Comml/Ind Tischer Family Trust 3366 Laurel Fort Meade 400 S. Royal Lane (3 parcels) 31.3 AC $14,840,000 $473,819 Industrial Liberty Property Trust Cabot Properties Brandon Woods * 10 AC $275,000 $27,500 Industrial CD Resource Ct., LLC Coach AM Group Holdings

SELECTED LAND SALES - USER - NONE REPORTED

* Denotes bankruptcy sale.

STATISTICS




Sublease Vacant (SF) 0 0 0

Total Vacant (SF) 233,000 151,000 69,000



Vacancy Rate Sublease % 0% 0% 0%

Net Absorption (SF) (128,000) (11,000) 47,000



2013 Planned Construction SF 0 0 0

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Marley Neck/Glen Burnie – Industrial 12/10/12

Vacancy Rate

0%

2%

4%

6%

8%

10%

12%

14%

2008 2009 2010 2011 2012

Absorption

-150

-100

-50

0

50

100

2008 2009 2010 2011 2012

thou

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s

Vacancy Rate (%)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

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$8.00

2008 2009 2010 2011 2012



Vacancy Rate

0%

2%

4%

6%

8%

10%

12%

14%

2008 2009 2010 2011 2012

Absorption

-150

-100

-50

0

50

100

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

69%

14%

17%

13


BUILDINGS DELIVERED IN 2012 - NONE REPORTED 2013 PLANNED CONSTRUCTION Address SF Product Asking Rent PSF Delivery Date Owner/Developer New Ridge Road 250,000 Bulk TBD 4Q 2013 Liberty Property Trust


ODENTON

14

STATISTICS




Sublease Vacant (SF) 78,000 15,280 0

Total Vacant (SF) 620,000 31,680 184,200

Total Existing RBA (SF) 1,800,000 142,000 535,000


Vacancy Rate Sublease % 4.3% 10.8% 0

Net Absorption (SF) (216,000) (31,680) (156,100)




FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Odenton – Industrial 12/14/12

Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

30%

35%

40%

2008 2009 2010 2011 2012

-400

-300

-200

-100

0

100

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012



Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

30%

35%

40%

2008 2009 2010 2011 2012

-400

-300

-200

-100

0

100

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

73%

6%

21%

Anne ArundelCounty

HowardCounty

MontgomeryCounty

CharlesCounty

CalvertCounty

CLINTON

FORT

HYATTSVILLE

WASHINGTON,DISTRICT

OF COLUMBIA

VIRGIN

IA

INNER BELTWAY

OUTER BELTWAY

NORTHERN P.G. COUNTY

SUBMARKETS

BRANDYWINE

95

95

95

495

495

5

4

4

1

1

50

210

210381

373

301

301202214

214

295197

HYATTSVILLE

UPPER

WASHINGTON

MITCHELLVILLE

BOWIE

MARLBORO

198

CAPITOLHEIGHTS

LANDOVER

BELTSVILLE

LAUREL

GREENBELT

LARGO

LANHAM

PRINCE GEORGE’S COUNTYIndustrial Submarket Map

princE gEorgE’s county

MARKET OVERVIEW

For Prince George’s County, 2012 proved to be a rebound year from the dismal performance of 2011. With the overall vacancy rate decreasing and absorption increasing throughout the county in most product types and submarkets, there is the indication that activities picked up and deals were getting done. However, this positive activity did not create an environment to stimulate new construction for one glaring reason; rental rates were eroding. Even though 2012 was an active year, much of that activity was pent up growth that had stalled during 2011 and the reduction of rental rates is what brought these deals out of their doldrums.

With rent stagnating, not many new projects went forward. There is still plenty of space in new product that has remained vacant as it competes for cheaper second generation relet space. Projects at the Brickyard in Laurel, Melford in Bowie, and Steeplechase in Capitol Heights all offer virgin space for lease. The good news is when they do lease, there are institutional investors waiting to pay low cap rates to acquire these quality properties if they are available. Look at the price paid by Prologis for the purchase of 11730-11750 Baltimore Avenue in Beltsville.

MARKET OUTLOOK

It looks like the new year will hobble along much like last year. With moderate growth predicted, rates will also rise moderately only because there is no growth on the supply side. Investment sales will occur as the remaining vacant product gets leased to good credit tenants which will encourage low cap rates. Institutional owners with less quality in their portfolios will seek to trim this excess. If there is any dramatic new development, it will come from the projects starting as mixed-use or adding mix to the existing commercial offerings. Konterra’s new Town Center will impact Northern Prince George’s with retail, office, residential and flex. Existing projects such as the Brickyard in Laurel and St. John’s Melford project in Bowie may benefit from the addition of residential to their mix which will spur on retail development and hopefully greater tenant interest in their buildings. As these projects evolve and as the economy continues to rebound, it appears that 2013 is shaping up to be a year in transition.

15

PRINCE GEORGE’S COUNTYIndustrial

PRINCE GEORGE’S COUNTY SIGNIFICANT ACTIVITY

SELECTED LEASING TRANSACTIONS Tenant Address SF Class Product Submarket Nash Finch 6304 Sheriff Road 364,562 B Whs Inner Beltway Rio Grande Food Products 8610 Cherry Lane 54,000 C Whs Northern PG The Life Center 5610 Linda Lane 32,843 C Flex Inner Beltway Adnet Systems 7515 Mission Drive 20,000 B Flex Northern PG Aries 5633 Commerce Drive 12,000 B Whs Outer Beltway

16

STATISTICS



New/Relet Vacant (SF) 1,832,432 1,665,276 2,438,555


Total Vacant (SF) 1,979,821 1,743,555 2,484,725



Vacancy Rate Sublease % .7% .4% .2%





FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Prince George’s County – Industrial 12/12/12

Vacancy Rate

Net Absorption

0%2%4%6%8%

10%12%14%16%18%20%

2008 2009 2010 2011 2012

-800-600-400-200

0200400600800

1,0001,200

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory

Bulk 33 Off/Whs 32 Flex 35


$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

2008 2009 2010 2011 2012



Vacancy Rate

Net Absorption

0%2%4%6%8%

10%12%14%16%18%20%

2008 2009 2010 2011 2012

-800-600-400-200

0200400600800

1,0001,200

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory

Bulk 33 Off/Whs 32 Flex 35


$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

32%

35% 33%


SELECTED BUILDING SALES - INVESTMENTS Class/ Address SF Price Price PSF Product Buyer Seller 6340 Columbia Park Rd (3 prop) 285,545 $27,750,000 $97.18 Flex Morgan Stanley American Realty Advisors 7610 Old Landover Road 251,227 $12,100,000 $48.16 B/Whs Exeter Prop. Group NPV / Direct Invest 11730-11750 Baltimore Avenue 221,000 $27,000,000 $122.17 A/Bulk Prologis Beltsville Express LLC 14851 Sweitzer Lane 84,961 $$7,000,000 $82.37 A/Bulk Terreno Realty Corp Kenneth Gilman

Prince George’s County - Industrial

INNER BELTWAY

17

STATISTICS




Sublease Vacant (SF) 62,429 72,944 0

Total Vacant (SF) 1,252,311 961,201 673,725



Vacancy Rate Sublease % .5% .7% 0%

Net Absorption (SF) 684,431 418,108 (117,951)




FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

PG Inner Beltway – Industrial 12/12/12

Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-400-300-200-100

0100200300400500600700800

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

2008 2009 2010 2011 2012



Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-400-300-200-100

0100200300400500600700800

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

40%

35%

25%


OUTER BELTWAY


SELECTED BUILDING SALES - USER Class/ Address SF Price Price PSF Product Buyer Seller 2300 Craftsman Circle 175,000 $4,700,000 $26.86 C/Whs US Electronics NC Ventures VI Craftman LLC 4900 Philadelphia Way 84,000 $6,500,000 $77.38 A/Whs Alsco The Cohen Companies 9001 Hampton Overlook 67,776 $4,728,160 $69.77 B/Whs G&G Outfitters Kahn Paper Co. 3331 75th Avenue 10,100 $825,000 $81.68 C/Whs Dannico, LLC Mitchell/Gardner

BUILDINGS DELIVERED IN 2012 Address SF Delivery Date Asking Rent PSF Type Owner/Developer 8520 Pepco Place 69,567 1Q 2012 Build-to-Suit User A/Bulk Mid Atlantic Construction/ Cornell Associates

STATISTICS



New/Relet Vacant (SF) 452,350 198,917 1,059,195

Sublease Vacant (SF) 0 0 34,000

Total Vacant (SF) 452,350 198,917 1,093,195



Vacancy Rate Sublease % 0% 0% 0.5%



2012 Completed Construction SF 69,567 0 0


FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

PG Outer Beltway – Industrial 12/12/12

Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-200

-100

0

100

200

300

400

500

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012



Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-200

-100

0

100

200

300

400

500

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

30%

16%

54%

18


NORTHERN P.G. COUNTY


2013 PLANNED CONSTRUCTION Address SF Class/Product Asking Rent PSF Delivery Date Owner/Developer 9260 Alaking 93,789 A / Bulk $6.90, NNN 1Q 2013 ATAPCO 1030 Hampton Park Blvd 48,557 A / Bulk $7.00, NNN 1Q 2013 ATAPCO SELECTED LAND SALES - INVESTMENT Address Size Price Price/AC Product Buyer Seller 1811 Cabin Ranch Dr 28 AC $9,700,000 $345,000 Bulk/Whs Carlyle Group Merchant’s Terminal Corp

19

STATISTICS





Total Vacant (SF) 275,160 583,437 763,035



Vacancy Rate Sublease % 2.5% .1% .2%





FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

Northern PG – Industrial 12/12/12

Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-250-200-150-100-50

050

100150200

2008 2009 2010 2011 2012

thou

sand

s

Vacancy Rate (%)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

2008 2009 2010 2011 2012



Vacancy Rate

Net Absorption

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

-250-200-150-100-50

050

100150200

2008 2009 2010 2011 2012

thou

sand

s

Absorption (SF)


Market Inventory



$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

2008 2009 2010 2011 2012


BulkOffice/WhsFlex

35%

40%

25%

70

70

95108

144

32

144

100

3297

29

1

32

29

COLUMBIA

CLARKSVILLE ELKRIDGE

LAUREL

ELLICOTTCITY

MontgomeryCounty


Anne ArundelCounty

BaltimoreCounty

FrederickCounty

Carroll County

HOWARD COUNTY

COLUMBIA NORTH

COLUMBIA SOUTH

COLUMBIA TOWN CENTER

SUBMARKETS

JESSUP

HOWARD COUNTYOffice Submarket Map

20

MARKET OVERVIEW

The overall Howard County market has continued its four year crawl back from the Great Recession of 2008. Howard County continues to be one of the leading commercial real estate markets in the state. We have seen a decrease in vacancy rates and encouraging signs of net absorption in certain submarkets of the county. New office development is being planned at Maple Lawn, a medical office building under construction at Waterloo Road, as well as planned mixed-use development in Columbia Town Center. Howard Hughes Corporation (HHC) continues to be a market mover. The company announced the acquisition of the former Ryland Homes headquarters at 70 Columbia Corporate Center and subsequently announced that Enterprise Foundation will be leasing in excess of 76,000 square feet.

Whole Foods will break ground in March 2013 for a 45,000 square foot store opening in the fall of 2014 in the former Rouse Company’s headquarters. Other Columbia Town Center activity includes First Potomac Realty Trust investing $7.5 million in renovations in the Merrill Lynch building and GGP pumping more than $2 million into 10 and 20 Columbia Corporate Center. The former WCI Communities’ site, across from The Mall in Columbia, is in the hands of developer David Costello, who will be building a multi-use project on the site.

MARKET OUTLOOK

We believe 2013 will be similar to its predecessor year as several companies will take a “wait and see” approach relating to the fiscal cliff and sequestration issues before Congress. However, the silver lining in the marketplace will occur in investment sales which remain very strong. User sales/owner occupied real estate seems to be on a slight uptick. Interest rates remain very low for occupiers who can achieve sub 4% financing in today’s market.

Certain demand drivers, such as government healthcare contractors doing work for Center for Medcaid Medicare Services (CMMS), located in Woodlawn, Maryland, have to be within a 10 mile radius of CMMS. Howard County has benefitted from these subcontractors being able to stay within the 10 mile radius, and having access to a highly educated workforce and an abundance of amenities for their employees. We forecast that the absorption and rental rates should continue to rise although the abundance of this activity may occur mid-year 2013.

howardcounty

HOWARD COUNTYOffice Market


SELECTED LEASING TRANSACTIONS Tenant Address SF Class US Government 9055 Sterling Drive 153,500 A US Government 7205 Riverwood Drive 115,000 B Enterprise Foundation 11000 Brokenland Parkway 76,300 A XL Health 6514 Meadowridge Road 68,779 A Tenable 7021 Columbia Gateway Drive 65,975 A New Day Financial 8135 Maple Lawn Boulevard 51,825 A

21

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS

Building Type Class A Class B

Number of Buildings 67 236

New/Relet Vacant (SF) 1,028,743 938,829

Sublease Vacant (SF) 82,360 12,284

Total Vacant (SF) 1,110,103 951,113

Total Existing RBA (SF) 6,851,798 8,902,928

Vacancy Rate Direct % 15% 10.5%

Vacancy Rate Sublease % 1.2% .1%

Net Absorption YTD (SF) 108,242 168,635

Average Rental Rate (Full Service) $24.76 $22.00

2012 Completed Construction SF 110,000 161,399

2013 Planned Construction SF 306,400 0


Howard County – Office 12/12/12

Net Absorption

Market Inventory

Class A 43 Class B 57

-500

50100150200250300350400450

2008 2009 2010 2011 2012

thou

sand

s

Class A43%Class B

57%

Class A Vacancy Rate (%)


Vacancy – Class A

Vacancy – Class B

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

0%

5%

10%

15%

20%

2008 2009 2010 2011 2012

Relet Sublet


Vacancy – Class A

Vacancy – Class B

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

0%

5%

10%

15%

20%

2008 2009 2010 2011 2012

Class B Vacancy Rate (%)

Relet Sublet

Absorption (SF)


Net Absorption

Market Inventory


-500

50100150200250300350400450

2008 2009 2010 2011 2012

thou

sand

s

Class A Class B



$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

2008 2009 2010 2011 2012

Average Rental Rate (%) PSF, FS

Class A Class B

Howard County - Office

COLUMBIA NORTH

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS



New/Relet Vacant (SF) 136,028 115,671


Total Vacant (SF) 157,114 125,611

Total Existing RBA (SF) 747,483 1,288,656

Vacancy Rate Direct % 18.2% 9.0%

Vacancy Rate Sublease % 2.8% .8%

Net Absorption YTD (SF) (37,123) 84,717


2012 Completed Construction SF 0 68,779



Columbia North – Office 12/10/12

Net Absorption

Market Inventory


-60

-40

-20

0

20

40

60

80

100

120

2008 2009 2010 2011 2012

thou

sand

s

Class A38%

Class B62%



Class A Vacancy

Class B Vacancy

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

Relet Sublet


Class A Vacancy

Class B Vacancy

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012


Relet Sublet

Absorption (SF)


Net Absorption

Market Inventory


-60

-40

-20

0

20

40

60

80

100

120

2008 2009 2010 2011 2012

thou

sand

s

Class A Class B



$20.50

$21.00

$21.50

$22.00

$22.50

$23.00

$23.50

$24.00

$24.50

$25.00

$25.50

$26.00

2008 2009 2010 2011 2012


Class A Class B


SELECTED LAND SALES Address Size Purchase Price Price Per AC Buyer Seller 5904 & 5910 Waterloo Rd 5.69 & 3 AC $1,435,200 $252,232 Kinsley Construction* Peter Voelkel Columbia Overlook 18.7 AC $5,300,000 $283,422 Chesapeake Partners GGP, Inc. 3330 Rogers Avenue 24.59 AC $5,000,000 $203,334 Waverly R. E. Group Howard Co. Gov.

22 * Denotes a joint venture with Seller.


COLUMBIA SOUTH

23

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS





Total Vacant (SF) 890,444 582,001



Vacancy Rate Sublease % 2.7% 1.8%



2012 Completed Construction SF 110,000 42,620



Columbia South – Office 12/12/12

Net Absorption

Market Inventory


-100-50

050

100150200250300350400

2008 2009 2010 2011 2012

thou

sand

s

Class A49%Class B

51%


Columbia South – Office 12/14/12 (revised)

Vacancy – Class A

Vacancy – Class B

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

0%

2%

4%

6%

8%

10%

12%

14%

2008 2009 2010 2011 2012

Relet Sublet

Columbia South – Office 12/14/12 (revised)

Vacancy – Class A

Vacancy – Class B

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

0%

2%

4%

6%

8%

10%

12%

14%

2008 2009 2010 2011 2012


Relet Sublet

Absorption (SF)


Net Absorption

Market Inventory


-100-50

050

100150200250300350400

2008 2009 2010 2011 2012

thou

sand

s

Class A Class B



$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

2008 2009 2010 2011 2012


Class A Class B

2013 PLANNED CONSTRUCTION Address RBA SF Delivery Date Class Asking Rent PSF Owner/Developer 8810 Corridor Road 32,000 12/13 B TBD Bruce Jaffe 8135 Maple Lawn Boulevard 141,000 12/13 A $32.50, FS St. John Properties 5900 Waterloo Road 52,000 12/13 A $25.00, NNN Kinsley Construction 6831 Benjamin Franklin Drive 56,700 6/13 A $28.00 + elec. Abrams Development 6821 Benjamin Franklin Drive 56,700 12/13 A 100% Leased Abrams Development


BUILDINGS DELIVERED IN 2012 Address RBA SF Delivery Date Class Asking Rent PSF Owner/Developer 8160 Maple Lawn Blvd 110,000 6/12 A $30.00 FS St. John Properties 11840 W. Market Place 42,620 11/12 B $11.50 NNN St. John Properties 6514 Meadowridge Road 68,779 3/12 B 100% Leased Merritt Properties 8210 Wellness Way 40,000 3/12 B 100% Leased Waverly Real Estate 13334 Clarksville Pike 10,000 3/12 B $16.00 NNN 2515 Liberty LLC


COLUMBIA TOWN CENTER


SELECTED BUILDING SALES - INVESTMENT Address SF Price Price PSF Class Buyer Seller 20 Properties 587,000 $80,750,000 $137.49 Office/Flex-Varies Greenfield Properties Prologis 4 Properties (Lakeview) 215,662 $20,200,000 $140.00 Office-Varies Archon Group Goldstar Group 70 Columbia Corp. Center 168,647 $16,000,000 $95.00 A Howard Hughes Corp. GGP, Inc. 2850 N. Ridge Road 42,333 $6,500,000 $153.54 B PRFPR North Ridge Rd 2850 N Ridge Assoc 9171 Baltimore Nat’l Pike 22,000 $4,200,000 $191.00 B Yong Yun Long & Foster

SELECTED BUILDING SALES - USER Address SF Price Price PSF Class Buyer Seller 7030 Hi Tech Road 48,000 $3,910,100 $81.42 B Tecore Wireless Wachovia/Wells Fargo 7050 Hi Tech Road 40,000 $3,488,830 $87.12 B OPS Consulting Wachovia/Wells Fargo

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS




Sublease Vacant (SF) 3,812 0

Total Vacant (SF) 176,131 120,774

Total Existing RBA (SF) 1,692,593 855,848





2012 Completed Construction SF 0 0

2013 Planned Construction SF 0 0


Columbia Town Center – Office 12/12/12

Net Absorption

Market Inventory


-80-60-40-20

020406080

100120

2008 2009 2010 2011 2012

thou

sand

s

Class A66%

Class B34%



Vacancy – Class A

Vacancy – Class B

0%

5%

10%

15%

20%

25%

30%

2008 2009 2010 2011 2012

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

Relet Sublet


Vacancy – Class A

Vacancy – Class B

0%

5%

10%

15%

20%

25%

30%

2008 2009 2010 2011 2012

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012


Relet Sublet

Absorption (SF)


Net Absorption

Market Inventory


-80-60-40-20

020406080

100120

2008 2009 2010 2011 2012

thou

sand

s

Class A Class B



$18.00

$19.00

$20.00

$21.00

$22.00

$23.00

$24.00

$25.00

$26.00

2008 2009 2010 2011 2012


Class A Class B

BWI CORRIDOR

ANNAPOLIS

SUBMARKETS

HowardCounty


To Chesapeake Bay Bridge

Calvert County

Ches

apea

ke B

ay

Baltimore

ANNAPOLIS

PASADENA

CROFTON

BWIAIRPORT

SEVERN

ODENTON

HANOVER

PARKSEVERNA

GLEN BURNIE

FORTMEADE

97

97

214

2

50

50

23

32

2

2

100

295

175

ANNE ARUNDEL COUNTYOffice Submarket Map

25

MARKET OVERVIEW

The Anne Arundel County office market continues to make steady improvement within the marketplace. Both the Class A and Class B office markets experienced a decrease in vacancy rate. Compared to 2011, vacancy rates have lowered from a total (new/relet and sublease space) of 12.5% to 11.4% for Class “A” space and dropped from 14% to 13.7% for Class “B” product. Net absorption took a downturn with approximately 305,000 square feet of Class “A” space absorbed in 2012, compared to approximately 505,000 square feet last year. Class “B” changed from a positive net absorption of approximately 10,000 square feet in 2011 to a negative 13,000 square feet in 2012. Average full service, office rents for both building classes remained flat staying within the $27.84 per square foot range for Class “A” and in the $21.43 per square foot range for Class “B”. The amount of construction remained firm with nearly 208,000 square feet of Class A space completed in 2012 compared to 230,000 square feet in 2011.

MARKET OUTLOOK

Demand for office space in Anne Arundel County will continue to grow steadily as local developers, such as Greenberg Gibbons Commercial, Chesapeake Real Estate Group and Corporate Office Properties Trust, are adding new opportunities to satisfy rising demand. Still, the overall business climate remains cautious. Even though the national election took place in November, a new economic concern has emerged called the “fiscal cliff.” There are several laws that are set to change at midnight on December 31, 2012. The effect of these laws could result in higher taxes and increased spending cuts, resulting in higher unemployment and a possible economic recession. A lack of a resolution by Congress is likely to cause businesses to begin changing their spending in anticipation of these impending changes. In addition, the Unites States is also poised to hit the “debt ceiling” again within the 1st quarter of 2013. Due to these possible changes in the economy, tenants are going to protect themselves and look for short term deals or termi-nation options.

On a positive note, Anne Arundel County will continue to be an ideal location to conduct business due to its prox-imity to Baltimore and Washington, DC, along with the presence of BWI Thurgood Marshall Airport, the National Security Agency, and Fort Meade. Continued low interest rates, the demand by defense contractors wanting to be near Fort Meade due to the implementation of C4ISR and Cyber Command will continue to draw businesses to the county. According to the Maryland Department of Labor, Anne Arundel County’s unemployment rate has remained the same from last year at 5.6% (Nov. 2012). This is still lower than the state unemployment rate of 6.4% and the national unemployment rate of 7.7%. Compared to the rest of the state, Anne Arundel County’s office market will continue to fare well in 2013.

annE arundElcounty

ANNE ARUNDEL COUNTYOffice Market


SELECTED LEASING TRANSACTIONS Tenant Address SF Class Avg Rental Rate PSF SAIC 8193 Dorsey Run Road 60,000 A $30.00-$35.00, FS US Government 410 National Business Park 52,600 A $37.00, FS Keyin 7740 Milestone Parkway 30,000 A $30.00, FS Ventura Solutions 2721 Technology Drive 16,500 A $30.00-$35.00, FS Nationwide Insurance 2594 Riva Road 9,791 B $16.00, NNN Habitat America 180 Admiral Cochrane Drive 7,200 A $29.50, FS

SELECTED BUILDING SALES - INVESTMENT Address SF Price Price PSF Product Buyer Seller 839 Elkridge Landing Rd 51,000 $2,350,000 $46 Office Zumot R.E. Mgmt LNR Property Corp 7300 & 7310 Gov. Ritchie Hwy 141,000 $2,850,000 $20 Office Daljit Sawhney C-III Realty Services

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS



New/Relet Vacant (SF) 920,909 1,026,917


Total Vacant (SF) 972,518 1,046,154




Net Absorption YTD (SF) 304,838 (13,054)


2012 Completed Construction SF 207,830 0

2013 Planned Construction SF 311,300 20,000


Anne Arundel County – Office 12/10/12

Absorption

-100

0

100

200

300

400

500

600

2008 2009 2010 2011 2012

thou

sand

sMarket Inventory


Class A53%Class B

47%



Vacancy – Class A

0%2%4%6%8%

10%12%14%16%18%20%

2008 2009 2010 2011 2012

Vacancy – Class B

0%2%4%6%8%

10%12%14%16%

2008 2009 2010 2011 2012

Relet Sublet


Vacancy – Class A

0%2%4%6%8%

10%12%14%16%18%20%

2008 2009 2010 2011 2012

Vacancy – Class B

0%2%4%6%8%

10%12%14%16%

2008 2009 2010 2011 2012


Relet Sublet

Absorption (SF)


Absorption

-100

0

100

200

300

400

500

600

2008 2009 2010 2011 2012

thou

sand

s

Market Inventory


Class A Class B


Average Rental Rate PSF (Full Service)

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

2008 2009 2010 2011 2012


Class A Class B

Anne Arundel County - Office

ANNAPOLIS


SELECTED BUILDING SALES - USER Address Size Price Price/PSF Product Buyer Seller 8531 Veterans Highway 19,500 $3,412,500 $175.00 Office Condo The Coordinating Ctr. SP Gateway Corp SELECTED LAND SALES - INVESTMENT Address Size Price Price/Acre Product Buyer Seller 1351 Blair Drive 2.05 AC $4,025,000 $1,963,415 Bank Branch Keith Sherman H&H Rock Corp 1296-1308 Crain Hwy 81 AC $3,300,000 $183,000 Mixed Hogan Cos. 1691 LP 810 Crain Highway 4.34 AC $1,200,000 $277,000 Zoned C4 Unknown Thomas Taro 3366 Fort Meade Road 19.96 AC $2,500,000 $125,250 Dealership Tischer Family Private Partnership

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS





Total Vacant (SF) 233,324 305,746






2012 Completed Construction SF 0 0

2013 Planned Construction SF 0 0



Annapolis – Office 12/14/12 (revised)

Vacancy – Class A

Vacancy – Class B

0%

3%

6%

9%

12%

15%

18%

21%

2008 2009 2010 2011 2012

0%

2%

4%

6%

8%

10%

12%

2008 2009 2010 2011 2012

Relet Sublet

Annapolis – Office 12/14/12 (revised)

Vacancy – Class A

Vacancy – Class B

0%

3%

6%

9%

12%

15%

18%

21%

2008 2009 2010 2011 2012

0%

2%

4%

6%

8%

10%

12%

2008 2009 2010 2011 2012


Relet Sublet

Absorption (SF)

Annapolis – Office 12/11/12

Net Absorption


-40-20

020406080

100120140160

2008 2009 2010 2011 2012

thou

sand

s

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

2008 2009 2010 2011 2012

Class A Class B


Rental Rate

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

2008 2009 2010 2011 2012


Class A Class B


Market Inventory


Class A43%

Class B57%

27

Anne Arundel County - Office

BWI CORRIDOR

ANNE ARUNDEL COUNTY SIGNIFICANT ACTIVITY BUILDINGS COMpLETED IN 2012 Address RBA SF Delivery Date Asking Rent PSF Class Owner/Dev. 8193 Dorsey Run Road 120,000 2/12 $30-$35, FS A Konterra Realty, LLC 7031 Ridge Road 87,830 11/12 $27.50 + Util. A Archon Group

2013 PLANNED CONSTRUCTION Address RBA SF Delivery Date Asking Rent PSF Class Owner/Dev. 7799 Arundel Mills Boulevard 171,300 12/13 $28.50 + Util. A Chesapeake R.E. Group 18 Magothy Beach Road 20,000 12/13 $29.00, NNN B RBP Property Acquisitions 420 National Business Parkway 140,000 12/13 $38.00, FS A COPT

FORECAST

Vacancy Rate

Absorption

Construction

Asking Rents

STATISTICS





Total Vacant (SF) 603,861 500,597


Vacancy Rate Direct % 10% 18.2%

Vacancy Rate Sublease % 0% .6%

Net Absorption YTD (SF) 260,000 (24,000)


2012 Completed Construction SF 207,830 0

2013 Planned Construction SF 311,300 43,000


BWI Corridor – Office 12/10/12

Absorption

-100

0

100

200

300

400

500

2008 2009 2010 2011 2012

thou

sand

sMarket Inventory


Class A68%

Class B32%



Vacancy Rate – Class A

0%2%4%6%8%

10%12%14%16%18%20%

2008 2009 2010 2011 2012

Vacancy Rate – Class B

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012

Relet Sublet


Vacancy Rate – Class A

0%2%4%6%8%

10%12%14%16%18%20%

2008 2009 2010 2011 2012

Vacancy Rate – Class B

0%

5%

10%

15%

20%

25%

2008 2009 2010 2011 2012


Relet Sublet

Absorption (SF)


Absorption

-100

0

100

200

300

400

500

2008 2009 2010 2011 2012

thou

sand

s

Market Inventory


Class A Class B



$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

2008 2009 2010 2011 2012


Class A Class B

28

RESIDENTIAL LAND

29

The report from the trenches is that the home building market in Maryland is in recovery mode. The extent of that recovery depends entirely on the county in question. Sales in Montgomery, Howard, and parts of Anne Arundel are doing well enough to whet the appetites of builders and developers alike for new land opportunities. The same cannot be said for those few builders working in tertiary markets such as Cecil, Washington, or Dorchester Counties, where sales for single-family homes in the very low $200s are still difficult to come by. In the mid-level markets of Baltimore, Prince George’s, Charles, and Frederick Counties, builders are selling moderately priced single-family homes – typically priced below $450K – with all the bells and whistles; but sales are hard pressed to maintain a consistent pace of two or three homes per month.

As one builder explained to me, “I’ll sell two houses a month in a given community. Then sales will drop off the cliff, only to begin again three months later at two sales a month for another couple of months before they stop again.” In the mid-level markets, builders are forced to coax buyers into making the commitment to buy by sweetening the deal with free upgrades, incentives, and help with closing costs.

The real news in residential land this year was not which builders sold the most homes in Maryland (for the umpteenth time, Ryan Homes), or which builders went out of business (none that comes to mind, after the extreme herd-culling of 2007 and 2008). No, the real news this year is how the state of Maryland has continued to make the already difficult and expensive process of land development into something akin to winning an Olympic gold medal: very challenging, very expensive, and given the odds, not very likely without a lot of help.

It used to be that if a small investor wanted to make a lot of money for retirement, they simply went twenty miles out of town and bought a large parcel of ground off the main road and waited for development to reach their property. Unfortunately, that method of retirement planning no longer works. Constantly-changing regulations and restrictions on development and the ever-present threat of community opposition all combine to result in down-zoning for the subject property. In today’s climate, holding land with an eye toward future development has become a highly-risky investment.

Historically, the regulations governing land development have come under the jurisdiction of local government – either on a county or incorporated town level – with only limited input from the state. Under the O’Malley administration, copious regulations and state bureaucracy have been heaped on anyone attempting to develop or build nearly anything in Maryland. O’Malley claims that the regulations are his attempt to help save the Chesapeake Bay; however, I have to wonder if regulating the land development and construction industry to near death is the best way to save our bay.

Long known as a difficult and expensive state in which to do business, Maryland has raised the bar to the point that it will soon be impossible to construct a moderately-priced home, inexpensive office building, or value-oriented shopping center and still comply with the myriad of new land use regulations. In fact, between the fees and regulations governing storm water management, various development impact fees imposed by counties to cover police and fire protection, new schools and expensive offsite improvement fees, we are seeing, for the first time, developers turning down otherwise good developable land because they simply cannot make their numbers work.

rural tier mapping

In April of 2012, the Maryland House of Representatives approved a land preservation bill, which will preserve rural land but limit how farmers/land owners may handle disposition of their land. The bill passed with a vote of 93 to 45.

The bill requires county governments to establish a four-tier system for septic use, aimed at protecting agricultural lands and forests. Under the new regulations, local jurisdictions were instructed to draw their own tier maps, along the following guidelines:

• Tier-one areas are served by local water and sewer systems, where growth is essentially maxed out.

• Tier-two areas are planned growth areas where water and sewer will be extended from existing municipal water systems.

• Tier-three is a mix of areas that allow septic use and also prohibit major subdivisions on septic in designated areas.

• Tier-four is designated as protected forest lands under the bill.

The bill limits the size of major developments requiring septic systems, and it discourages rural development needing septic systems in favor of urban development, which can take advantage of public sewer systems.

Farmers are rightfully concerned with the development restrictions of the new regulations, since the regulations reduce the value of land and, therefore, reduce the equity they can borrow against to buy supplies and equipment.

The new bill remains unpopular with farmers, rural landowners, and developers alike.

allocations for growth

Just when developers thought that Maryland could not possibly implement additional rules and regulations for development, the Maryland Department of the Environment is set to launch Allocations for Growth (AfG), an offset/trading policy designed to ensure the quantification and mitigation of nutrient pollution. The program, expected to begin on January 1, 2014, requires developers, builders, and others to offset 100% of the post-development load from every land development project. The policy not only requires complete and full offset of all nutrient pollutant loads from new projects, but existing developments where a building is altered (encompassing both the construction of an addition as well as the development of additional units or square footage of otherwise undeveloped land). The Maryland Department of the Environment (MDE) will be creating regulations that define how these pollutant loads will be calculated, as well as setting regulations governing how many offset credits developers will be required to purchase in order to fully offset the loads generated for each project.

Though MDE will be setting the regulations as to how many offset credits will be required, they will not be selling offset credits; rather they will allow developers to find willing landowners within the same county or watershed to sell offset credits for nitrogen and phosphorus. The program as proposed will require the buyer to find a willing seller who is agreeable to “offset land” under the regulations to be imposed by the MDE. The word from the trenches is that – beginning in 2014 – this requirement could add as much as $40,000 to the cost of a single family home. The regulations, which are currently still a work-in-progress, will allow for one credit to equal one pound of nitrogen or phosphorus.

With all the changes, 2013 will be a year that has most of us watching intently. On the one hand, we have an industry that is finally, precariously, inching its way to recovery; and on the other hand, we have new bureaucratic regulations undermining the pace of the recovery, particularly in our primary markets. With the ball and chain of government regulations holding back an otherwise regenerating land development industry, the only clear winner in 2013 may be the Chesapeake Bay.

INVESTMENT OVERVIEW

The investment sales market in 2012 carried forward the themes of 2011. The volume of institutional investment sales this year continues to increase and has exceeded the level seen in the last market peak of 2007. Capitalization rates have continued to fall and are approaching 2007 levels again.

As an example, institutional buyers of industrial product have driven the price of high quality bulk warehouse buildings to record high levels, with a few instances of buildings trading north of $100 per square foot to investors having occurred.

Low interest rates remain the main driver of values. Institutional investors in particular are willing to tolerate very low returns on the highest quality real estate, and even tolerate the risk of falling rental rates and rising vacancy rates, because often the “worst case” scenario is for them better than the alternative (i.e. leaving their cash “in the bank”). Private investors depend on leverage and are more reticent about taking those risks.

Along with those institutional buyers, owner-occupants are proving to be excellent purchasers, being drawn into the market by very attractive bank financing with rates often down into the sub-5% range. Unfortunately, the inventory of high quality buildings suitable for owner-occupancy is limited in our market.

In contrast with the institutional and owner-occupant markets, smaller investment opportunities that are stable and well-leased are not trading as frequently as in 2006-2007 and earlier. The bulk of these “private market” investment sales (defined here as sub-$10 million sales) have been to users or have involved some sort of distress.

Conduit financing fueled a high volume of private market sales before the market turndown in late 2008. The lack of that attractive non-recourse financing today is dampening the volume of sales of stable mid-market assets that normally sell to private buyers, though we are projecting an incremental increase in the volume of sales of these types of assets in 2013.

That said, mid-market assets with an element of distress to them (e.g. bank owned property, note sales, short sales) are generating tremendous and sometimes irrational interest from buyers. For better or for worse (depending on where you stand), there are few troubled assets transacting in our market. There is a bottleneck of sorts from lenders. Banks are slow to write assets down to market to accept losses. The third party special services that manage and dispose of troubled securitized (CMBS) loans are overwhelmed and are in some cases taking years to take back and eventually sell distressed assets. Across the board, investor buyers have become more pessimistic about leasing prospects in 2013. Buyers are projecting rental rates to remain flat or decline for several years, and are expecting vacant space to take longer to lease. Generally, investors are projecting rental rate growth and an increase in leasing velocity, only they are expecting that trend to begin two to three years from now.

The most sought after product types include bulk warehouse, institutional quality office in core markets such as the District of Columbia and affluent inside-the-Beltway suburbs, along with grocery-anchored retail and multifamily.

Most out of favor today is suburban office and flex product. Investors see more downside risk in terms of rental rates and vacancy here with a likely contraction in the government coming. We see an interesting contrarian play here in buying these assets in locations that have at least some constraints to new development, are near executive housing, and where they can be bought at a dramatic discount to replacement cost. Markets to avoid are those that have seen very little historic rental rate growth over the past several decades.

The volume of new properties coming to market has dropped in the second half of the year. We speculate this has something to do with the ongoing negotiations over the so-called “fiscal cliff.” Unfortunately, a package of tax increases and government spending cuts will not serve the economy in the Washington- Baltimore area well. Sellers recognize this risk and are waiting to see at least a short term resolution to the matter before taking assets to the market.

30

Investment Overview 1/4/13

020406080

100120140160180200

2007 2008 2009 2010 2011 2012ytd

num

ber o

f com

mer

cial

r.E

. sal

es

commercial real Estate sales - baltimore metropolitan area

Under $10 Million(Private Market)

Over $10 Million(Institutional)

Investment Overview 12/10/12

020406080

100120140160180200

2007 2008 2009 2010 2011 2012ytd

num

ber o

f com

mer

cial

r.E

. sal

es

Under $10 Million(Private Market)

Over $10 Million(Institutional)

0%1%2%3%4%5%6%7%8%9%

10%

2007 2008 2009 2010 2011 2012 ytd

perc

enta

ge

average capitalization rate

Build on the power of our network. TM

31

Paragon Commercial Property Management, a subsidiary of KLNB, LLC, is a full-service provider of commercial real estate property and asset management services.

Paragon takes a strong “hands on” philosophy to managing its properties. Engineers inspect each building regularly and meet constantly with its tenants and vendors. Paragon is building an organization based on a reputation for superior service and invites you to contact any of the tenants or building owners that it serves.

Paragon employs six roving maintenance engineers who perform a multitude of services including all basic mechanical, electrical, plumbing and janitorial work. As a result, in many circumstances we are able to provide owners faster and less-expensive service than if a contractor had been called.

Paragon can deliver the following variety of services: • Property and asset management for commercial office, retail, industrial and corporate facilities projects. • Assume complete day-to-day management of your facilities. • Provide on-site management and technical personnel. • Provide 24-hour on-call service. • Maintain a comprehensive database for service calls. • Maintain comprehensive budget information. • Produce accurate and timely monthly reports. • Maintain monthly operating expense summaries and variance reports. • Set-up a program whereby all invoices related to a project are segregated. • Develop a comprehensive summary of all equipment and systems located at your property. • Produce a comprehensive operational manual. • Design a complete preventive maintenance program summarized in an annual operational calendar. • Provide a comprehensive lease administration program.

For additional information please go to: www.paragoncpm.com

The CCIM movement began more than 40 years ago with commercial real estate practitioners who wanted to elevate their business practices through focused education and networking opportunities. Still today, education and networking remain the cornerstones of the CCIM designation and the reason for its success. The CCIM Institute confers the CCIM designation and is an affiliate of the National Association of REALTORS® (NAR). With more than 19,000 members in 33 countries and 61 chapters worldwide, the CCIM Institute has emerged as a truly global organization.

Brokerage Services• Tenant/Landlord Representation• Buyer/Seller Representation• Sales/Leasing/Subleasing• Portfolio Marketing• Market Reports & Opinions of Value• Site Selection Analysis• Market Research/Mapping/Demos

Financial & Investment Services• Investment Acquisitions & Sales• Mortgage Brokerage• Structured Lease Finance• 1031 Exchange Services

On-Line Services• REALTrac™ Online • Transaction Management• NAIDirect.com • Surplus Property Hosting/Marketing • Market Research & News • Demographic/Mapping Services• LoopNet • CoStar Property • Builder Info Tools™

®®

OUR SERVICESOUR SERVICESOUR SERVICESLease Consulting Services• Lease Auditing/Compliance• Lease Abstracting• Lease Databases & Administration• Lease Consulting

Management Services• Property & Asset Management

The SOCIETY OF INDUSTRIAL AND OFFICE REALTORS® is one of the leading professional commercial and industrial real estate associations. With more than 3,000 members in more than 580 cities in 26 countries, SIOR represents today’s most knowledgeable, experienced, and successful commercial real estate brokerage specialists. SIOR is dedicated to the practice and maintenance of the highest professional and ethical standards. SIOR maintains a commitment to business and industry by providing outstanding professional services, publications, and educational programs.

Commercial Real Estate Services, Worldwide.A division of KLNB, founded in 1968.

investment offering

MEADOWS BUSINESS PARKA RETAIL, OFFICE AND INDUSTRIAL PORTFOLIOBALTIMORE, MARYLAND

The NAI KLNB Team

Columbia, mD

* denotes principal of firm

www.klnb.com

In 2012, NAI KLNB reported volume of over $1.27 billion on 989 separate real estate transactions in the leasing and selling of industrial, office, land and retail product. The full-service brokerage firm operates Maryland offices in Towson and Columbia, as well as Vienna and Brambleton, Virginia, and Washington, D.C. KLNB is the mid-Atlantic representative of NAI, a network of real estate service providers serving more than 200 markets worldwide. KLNB represents NAI with a full range of brokerage, financial and investment services. In the Baltimore-Washington Corridor and BWI Thurgood Marshall Airport office market, the NAI KLNB team includes:

B/W CORRIDOR OFFICE6011 University Boulevard

Suite 350

Ellicott City, Maryland 21043

Tel: (410) 290.1110 / (301) 621.5114

Fax: (410) 290.0723

VIRGINIA OFFICE I8027 Leesburg Pike

Suite 300

Vienna, Virginia 22182

Tel: (703) 288.4000

Fax: (703) 288.2999

BALTIMORE/TOWSON OFFICE100 West Road

Suite 505

Baltimore, Maryland 21204

Tel: (410) 321.0100

Fax: (410) 321.0129

VIRGINIA OFFICE II42395 Ryan Road

Suite 200

Brambleton, Virginia 20148

Tel: (703) 722.2700

Fax: (703) 722.2730

WASHINGTON, DC OFFICE 5225 Wisconsin Ave., N.W.

Suite 600

Washington, DC 20015

Tel: (202) 375.7500

Fax: (202) 237.9850

While we have no reason to doubt the accuracy of any of the information supplied, we cannot, and do not, guarantee its accuracy. All information should be independently verified prior to a purchase or lease of the property. We are not responsible for errors, omissions, misuse, or misinterpretation of information contained herein & make no warranty of any kind, express or implied, with respect to the property or any other matters.

pARAGON COMMERCIAL pROpERTY MANAGEMENT60 West Street

Suite 204

Annapolis, Maryland 21401

Tel: (410) 280.1450

Fax: (410) 280.1451

1916 Wilson Boulevard

Suite 306

Arlington, VA 22201

Tel: (703) 812.0334

Fax: (703) 812.9002

Global Solutions. Serving the Mid-Atlantic Region Since 1968

Local Expertise.

Robert Z. Smith*Industrial

[email protected]

J. Allan Riorda, SIOR*Industrial

[email protected]

Craig P. Morrell, SIOR*Office/Industrial

[email protected]

James V. Caronna, SIOR*Industrial

[email protected]

David J. Fritz, CCIM, SIOR*Office

[email protected]

Established in 1968, KLNB, Inc. is a full-service commercial real estate firm offering sales, leasing, development, property management and real estate investment services. The company employs more than 80 real estate professionals, including 35 principals.

Michael P. MoranOffice/Industrial

[email protected]

Bill MartienIndustrial

[email protected]

Kate M. MirabileMarketing Coordinator

[email protected]

Jonathan M. GreenOffice/Industrial

[email protected]

Alan M. Coppola, SIOROffice/Industrial

[email protected]

Charles A. BreitenotherOffice

[email protected]

M. Carol MoxExecutive Brokerage Assistant

[email protected]

Josh HalbedelLand Sales

[email protected]

Stephen J. Ferrandi*Land Sales

[email protected]

Kelly L. ShinnickGraphic Designer

[email protected]

Kate E. JordanOffice/Industrial

[email protected]

Michele D. Kornbluth, SIORMedical/Office443.574.1403

[email protected]

Christopher B. Kubler, CCIMInvestment Sales

[email protected]

Robert S. ClementsIndustrial

[email protected]

2012 eoy industrial-office

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