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CBRE State of the Market:

Second Quarter Washington, DC Regional

Office Market Statistics

June 30, 2011

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Agenda

Introduction

Overview of Washin ton DC Re ion

In-depth Analysis of Quarter

Northern Vir inia Washington, DC

Suburban Maryland

National Overview and Outlook Questions

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Introduction

Speakers

Liz Wainger, Moderator

John Germano, Executive Managing Director ar anne wear ngen, esearc anager

Jon Southard, Principal and Director of Forecasting,

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Washington Metropolitan

Second Quarter 2011

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Historical DeliveriesNorthern Virginia

2009200820072006

2010

6.1M SF . 5.5M SF . 313K SF

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DevelopmentNorthern Virginia

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Historical Vacancy RatesNorthern Virginia

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Northern Virginia Historical Trends

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, ,

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DevelopmentWashington, DC

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Historical Vacancy RatesWashington, DC

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Suburban Maryland Historical Deliveries

200920082007

2010

. . .

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DevelopmentSuburban Maryland

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Suburban Maryland Historical Vacancy Rates

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Hi i l T d

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Suburban Maryland Historical Trends

10-Year Average Net Absorption: 256,364 SF

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The Economy And the National

DC Advantage Starts with Employment

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DC Advantage Starts with Employment

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Office Market Healing Nationally

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Office Market Healing Nationally

24150Completions, Net Absorption, msf Vacancy, %

Forecast

20100

120

8-50

0

4

-150

-100

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Completions (L) Net Absorption (L) Vacancy (R)

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Source: CBRE EA Office Outlook, Summer 2011.

Pricing Power Will Begin to Shift But Slowly

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Pricing Power Will Begin to Shift, But Slowly

2115Rent Inflation, % Vacancy, %

Forecast

1810

12

15

0

5

9-5

6-10

3-15

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Rent Inflation Vacancy (R)

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Source: CBRE EA Office Outlook, Summer 2011.

Industrial Availability Keeps Dropping

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Industrial Availability Keeps Dropping

18150

Net Absorption, Completions (msf) Availability Rate (%)

Forecast

12

15100

9

0

3-50

0-100

200

0.

1

200

1.

2

200

2.

3

200

3.

4

200

5.

1

200

6.

2

200

7.

3

200

8.

4

201

0.

1

201

1.

2

201

2.

3

201

3.

4

Completions (L) Net Absorption (L) Availability Rate (R)

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Source: CBRE EA Industrial Outlook, Summer 2011.

Lower Availability Will Start to Drive Rent Growth

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Lower Availability Will Start to Drive Rent Growth

1812

Annual % in TW Warehouse

Rent Index Availability Rate (%)

158

orecast

90

3

6

-8

-4

0-12

990

991

992

993

994

995

996

997

998

999

000

001

002

003

004

005

006

007

008

009

010

011

012

013

014

015

016

1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

Rent Growth (L) Availability Rate (R ) LT Availability Average

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Source: CBRE EA Industrial Outlook, Summer 2011.

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Questions?

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