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Second Quarter 2009 ReportVol. 5, No. 2Investment Trends

Quarterly

Spotlighton

Nashville

1Investment TrendsQuarterly

Copyright© 2009 by Real Estate Research Corporation (RERC) and the CCIM Institute.

InThisVolume

Regional and Metro-Level AnalysesComing Soon!

East RegionBaltimore, Boston, Charlotte, Hartford, Norfolk, Northern New Jersey, New York City, Pittsburgh, Philadelphia, Raleigh, Richmond, Washington, D.C.

South RegionAtlanta, Austin, Dallas/Ft. Worth, Houston, Memphis, Miami, Nashville, New Orleans/Baton Rouge, Oklahoma City, Orlando, San Antonio, Tampa

Midwest RegionChicago, Cincinnati, Cleveland, Columbus, Detroit, Indianapolis, Kansas City, Milwaukee, Minneapolis, Omaha, St. Louis, Toledo

West RegionDenver, Honolulu, Las Vegas, Los Angeles, Phoenix, Portland, Sacramento, Salt Lake City, San Diego, San Francisco, Seattle, Tucson

Now Available!National OverviewIn Search of Bottom

Economic Background and Investment Environment

How Is Commercial Real Estate Affected?

A Focus on Real Estate Cap Rate & Yield Rate ExpectationsNational Market Analysis & Property Sector Highlights“Nashville Tunes in New Economic Growth...Beyond the Music”ContributorsScope & Methodology



Foreword

May 2009

Dear Readers,

Although the sense of optimism that we usually have during the spring season is being overshadowed by the reces-sion, there are news flashes here and there that indicate the economic freefall may be slowing. However, first quarter 2009 GDP contraction was nearly as low as that for fourth quarter 2008, and while not as many people in April lost jobs as did people in March, the unemployment rate increased from 8.5 percent in March to 8.9 percent in April. We were reminded that while it appears economic stabilization is underway, there will be many more ups and downs ahead of us before we see anything resembling economic recovery.

As for commercial real estate, a lagging indicator to the economy, we have yet to reach the bottom of this down cycle. For those of you who thought we would never again see anything like the real estate crisis in the early 1990s, it appears that the losses in this recession may be even more severe. In the 1990s, prices declined 30 to 35 percent over 5 years, which was bad enough. However, the crisis we find ourselves in today is happening at an accelerated pace, and real estate prices have fallen 20 to 25 percent on a free and clear basis in just the last 3 quarters!

Beyond price adjustments, reduced returns, and continued lack of credit availability, property fundamentals are de-clining throughout the industry. On a national basis, vacancy rates are up at least a half percentage point for each property type. Prices and rents are declining, absorption is negative, and capitalization rates are increasing. RERC’s analysis of this information, along with the views contributed by many CCIM Institute designees and candidates, is provided in the second quarter 2008 RERC/CCIM Investment Trends Quarterly.

We thank all who responded to and completed RERC’s surveys when encouraged by the CCIM Institute. Your con-tributions to the information available to the commercial real estate industry are needed and appreciated now more than ever.

Sincerely,

Kenneth P. Riggs, Jr., CCIM, CRE, MAIPresident & CEOReal Estate Research Corporation (RERC)

Charles “Mac” McClure, CCIM2009 CCIM Institute PresidentChairman, The McClure Group, Inc.



InSearchofBottom

The recent Chapter 11 bankruptcy of General Growth Properties, Inc. was a particularly sad day for anyone associated with this real estate investment trust (REIT) or with the Bucksbaum family. Like many other real estate owners who have overleveraged, General Growth was caught in the worst credit and capital markets crisis since the 1930s and was not able to work its way through it without reorganizing. While we understand and appreciate the difficulty General Growth is going through, it is important to also take note of how quickly the financial situation of the nation’s second largest mall owner deteriorated, and how the challenges they have and are going through are also occurring in countless other businesses. The speed at which this recession has deepened and the severity of its damage have shocked us all, from the federal government on down.

Still, in the long run, there may be more hope for General Growth to come back from bankruptcy and to preserve the majority of its assets than it will for many other industries. Although we are seeing some progress in the housing industry, there is much unraveling yet to be done at Fannie Mae and Freddie Mac, with more home foreclosures and further price declines, at least in some regions, still ahead. In addition, the stress tests administered to the large investment houses have not reflected well on the banks’ overall health, and despite some first quarter profits, there are still worrisome piles of legacy/toxic assets on the banks’ books that must somehow be disposed of. The auto industry is at a breaking point, and with the bankruptcy of Chrysler, there are fears that the bankruptcy of General Motors cannot be far behind. An average of 45 percent fewer cars and light trucks were sold by the Big Three last year than in the previous year, and it is no wonder that lower sales volume, added to their other high costs of doing business, may mean the end of this industry as we know it. When we consider the ripple effect on auto parts suppliers of steel, rubber, tech items like CD players or GPS systems, besides the leathers and fabrics that are included in the production of a car or truck, one can get an idea of the additional jobs that are likely to be lost before this is over. Other industries, including insurance, retailing, manufacturing, airlines, hotels and lodging, education, state and local governments, and even healthcare continue to see increased unemployment as well.

As always, it is the loss of jobs that will have the longest-lasting impact on commercial real estate. With unemployment expected to increase at least throughout 2009, the damage to real estate fundamentals will increase accordingly, with higher vacancy, negative absorption, declining rents, and decreased values. It will be some time before we see the bottom of the commercial real estate market and know exactly what it is we have to deal with, but the majority of real estate investors remain determined to work through and overcome the new depths associated with this crisis.



It seems that most watchers of the economy have spent the majority of first quarter 2009 downgrading their expectations for the rest of this year. We have seen some indications of improvement during the last month or two, but hopes for an early end to the recession were dashed when the Commerce Department reported first quarter gross domestic product (GDP) growth grew at a seasonally-adjusted annual rate of –6.1 percent for first quarter, not much better than the –6.3 percent rate for fourth quarter 2008. In addition to witnessing the worst 6-month economic performance since the 1950s, this is the first time since the mid-1970s that we have seen the economy contract for 3 consecutive quarters.

With the loss of another 674,000 jobs in March 2009 and 539,000 jobs in April, unemployment increased to 8.9 per-cent. Recent losses were higher than most economists had expected, and came from a broad array of companies like United Technologies, Nortel Networks, Pioneer, Goodyear, Smithfield Foods, Nissan Motor, Panasonic, Estee Lauder, PNC Financial Services, and others. Many economists are now predicting that the unemployment rate will reach double digits by the end of this year.

On a local level, 18 of the 372 metros tracked by the Bureau of Labor Statistics (BLS) have jobless rates of at least 15 per-cent, and 109 metros have jobless rates of at least 10 per-cent, with El Centro, Calif., reporting an unemployment rate of 25.1 percent, the highest unemployment rate among these metros.

The pressure remains on consumers, but consumers have less to spend and they are saving more of what they do have during this recession. It is no wonder they are keeping their pocketbooks closed—they have lost retirement savings, lost value in their homes, and are worried about losing their jobs. This loss is real, and it is immense. According to the Federal Reserve, the drop in household net worth, including home values, mutual funds, life insurance, and college and pension funds, dropped by $11 trillion, a decline of nearly 18 percent, during 2008.

Although consumer spending increased 2.2 percent in first quarter 2009, personal consumption fell at a seasonally-adjusted rate of 0.2 percent during the month of March, the fourth such decline during the last 6 months. In addition, retail

sales inched upward during the first part of the quarter, with a 1.9 percent jump in January and a 0.3 percent increase in February, but March retail sales declined 1.1 percent. Per-sonal income fell 0.3 percent in March, the fifth decrease in the last 6 months, while personal savings increased 4.2 per-cent in March, reports the Commerce Department.

As second quarter 2009 gets underway, however, there have been a few signs that the economy could be starting to stabi-lize. Consumer confidence increased to 39.2 in April, up from 26.9 in March. Although this jump was considerable, the in-dex reading overall was approximately two-thirds lower than it was 2 years ago. Still, it is a sign that consumers may be starting to think about loosening up on the purse strings. Ac-cording to the Conference Board, the Present Situation Index and the Expectations Index also rose in April.

The Commerce Department reported that housing starts in-creased 17.2 percent in February 2009 to 572,000 homes, although starts fell 10.8 percent in March to a seasonally-ad-justed 510,000 homes. With the inventory for homes remain-ing high, this decrease is considered a positive factor for the housing market overall in that it helps to keep overall supply from increasing further. Home prices fell 2.2 percent in Febru-ary, according to the Standard & Poor’s/Case-Shiller Index, but it is important to note that the pace of deterioration has slowed and that a period of leveling off may be underway.

Perhaps the most encouraging flicker of improvement in the economy is the stock market’s brief market rally that we en-joyed this April. Although we have a long way to go before we can even imagine recovering what was lost in last fall’s crash, since the stock market generally serves as a leading indica-tor regarding improvement in the economy, there is legitimate hope that things may slowly start to turn around, barring any new calamities.

With respect to the economic landscape, CCIM members who responded to RERC’s survey rated the U.S. economy’s first quarter 2009 performance at 3.5 on a scale of 1 to 10, with 10 being excellent. While low, this rating is up from last quarter’s rating of 2.6. The East and Midwest regional econo-mies received slightly higher ratings than the West and South regions.

Economic Background andInvestment Environment

Although some parts of the commercial real estate industry have been suffering through the credit crisis from the begin-ning (commercial mortgage-backed securities, for example), the private equity arena has only over the past 2 quarters experienced the kind of damage that other investments have endured. But how quickly this damage has occurred! Declin-ing prices and values have accelerated during this recession much more rapidly than that seen during the 1990s real estate crisis. In the current recession, institutional real estate prices have dropped 20 to 25 percent on a free and clear basis in just a few quarters. Compare this to the price declines in the 1990s, when prices declined 30 to 35 percent over 5 years, and one can see the rapid pace the commercial real estate industry is undergoing today.

CCIM members rated commercial real estate at 6.2 on a scale of 1 to 10, with 10 being high, the highest rating among the various investment alternatives during first quarter 2009, and this is the first time since second quarter 2008 that commer-cial real estate was ranked higher than cash. As shown in Ex-hibit 1, CCIM respondents rated cash second highest at 5.8, followed by stocks and bonds at 4.8 and 4.4, respectively.

RERC’s insti-tutional survey r e s p o n d e n t s still recommend holding com-mercial real estate assets, although inter-estingly, this rating (7.2 on a scale of 1 to 10, with 10 being high) is down

slightly from last quarter. Further, an increasing number of respondents thought it may be a good time to buy, indicat-ing that investors believe prices may be close to the bottom. Exhibit 2 demonstrates that although the recommendation to buy increased, the recommendation for selling properties re-mains quite low.

As shown in Exhibit 3, investment conditions ratings increased during first quarter 2009 for every major property type, ex-cept apartments. However, the apartment sector once again received the highest investment conditions rating—5.5 on a scale of 1 to 10, with 10 being high—and was the only sector



How Is Commercial Real Estate Affected?

Exhibit 1. CCIM RespondentsRate Investments

1Q 2009 4Q 2008

Commercial Real Estate 6.2 5.7

Stocks 4.8 3.9

Bonds 4.4 4.2

Cash 5.8 6.2

*Ratings are based on a scale of 1 to 10, where 1 is poor and 10 is excellent.Source: RERC/CCIM Investment Trends Quarterly Survey, 1Q 2009.

Exhibit 3. Investment Conditions Ratings* - 1Q 20091Q

20094Q

20083Q

20082Q

20081Q

2008

Office 3.7 3.2 4.2 4.6 5.1

Industrial 4.4 4.2 4.6 5.3 5.9

Retail 3.4 3.0 4.2 4.9 5.4

Apartment 5.5 5.7 6.2 6.5 7.0

Hotel 3.7 3.5 4.6 5.4 5.9*Ratings are averages based on responses to surveys from CCIM designees and candidates for first quarter 2009.Ratings are based on a scale of 1 to 10, where 1 is poor and 10 is excellent.

2

4

6

8

10

2

4

6

8

10HoldSell

Buy

1Q 2009

1Q 2008

1Q 2007

1Q 2006

1Q 2005

1Q 2004

1Q 2003

1Q 2002

1Q 2001

1Q 2000

Exhibit 2. RERC Historical Buy, Sell, Hold Recommendations

*Ratings are based on a scale of 1 to 10, where 1 is poor and 10 is excellent.Source: RERC Institutional Investment Survey, 1Q 2009.

Rat

ing



Exhibit 5. What Do the Financial Markets Tell Us?

Compounded Annual Rates of Return as of 3/31/2009

Market Indices YTD 1-Year (2008) 3-Year 5-Year 10-Year 15-Year

Consumer Price Index1 0.58% -0.28% 2.14% 2.60% 2.59% 2.49%

10-Year Treasury Bond2 2.74% 3.44% 4.36% 4.27% 4.65% 5.21%

Dow Jones Industrial Average -12.48% -35.94% -9.52% -3.64% -0.36% 7.34%

NASDAQ Composite3 -3.07% -32.93% -13.23% -5.18% -4.65% 4.92%

NYSE Composite3 -13.52% -43.40% -15.44% -5.48% -2.45% 4.39%

S&P 500 -11.01% -38.09% -13.06% -4.77% -3.00% 5.91%

NCREIF Index -7.33% -14.67% 4.16% 9.43% 9.37% 9.94%

NAREIT Index (Equity REITS) -17.61% -58.16% -25.05% -8.64% 3.89% 5.24%1Based on the published data from the Bureau of Labor Statistics (Seasonally Adjusted).2Based on Average End of Day T-Bond Rates.3Based on Price Index, and does not include the dividend yield.Sources: BLS, Federal Reserve Board, S&P, Dow Jones, NCREIF, NAREIT, compiled by RERC.

to receive a rating higher than 5. The retail sector once again received the lowest investment conditions rating.

As demonstrated in Exhibit 4, CCIM members who responded to RERC’s survey rated the overall return versus risk for com-mercial real estate at 5.3 on a scale of 1 to 10, with 10 being high, during first quarter 2009. This is up slightly from the pre-vious 3 quarters, and is a positive sign indicating that respon-dents feel the return for commercial real estate does outweigh the risk. While the score does not invoke great confidence, it does show that sentiment has improved.

The apartment sector was again the highest ranked performer for the return versus risk rating, with a score of 6.3 on a scale of 1 to 10, with 10 being high, for first quarter 2009. At 5.3, the industrial sector received the next highest rating. With the exception of these two sectors, nothing else had a return that outweighed the amount of risk taken.

CCIM members rated value versus price for the commercial real estate market at 5.1 on a scale of 1 to 10, with 10 being high, during first quarter 2009. This increase from the 4.5 rat-ing in fourth quarter 2008 indicates that respondents are a little more optimistic than last quarter about this asset class, and on average, they feel the value of commercial real estate slightly outweighs the price.

At 5.4 and 5.2, respectively, the industrial and apartment markets were the only sectors that received a value versus price rating higher than 5.0 on a scale of 1 to 10, with 10 being high. Although the value versus price ratings are up for every property type, the price is perceived to be higher than the value of office, retail, and hotel properties.

Commercial real estate investors lost another 7.33 percent during first quarter 2009, according to the National Council of Real Estate Investment Fiduciaries (NCREIF), which was still less than most stock market losses for this time period, as reflected in Exhibit 5. There have been recent improvements to the stock market, but commercial real estate still has a lot of pain in store.

Exhibit 4. Historical Return/Risk and Value/Price Ratings1Q 2009 4Q 2008 3Q 2008 2Q 2008 1Q 2008

Return vs. RiskOverall 5.3 4.6 5.1 5.1 6.2

Office 4.6 3.8 4.5 4.6 4.9

Industrial 5.3 4.6 5.1 5.2 5.9

Retail 4.0 3.3 4.6 4.5 5.5

Apartment 6.3 5.8 6.1 6.3 6.8

Hotel 4.6 4.1 4.5 5.0 5.6

Value vs. PriceOverall 5.1 4.5 4.5 4.8 4.8

Office 4.8 4.3 4.2 4.4 4.6

Industrial 5.4 4.7 4.6 4.9 5.1

Retail 4.5 3.8 4.2 4.3 4.8

Apartment 5.2 4.8 5.0 5.2 5.1

Hotel 4.7 4.1 4.1 4.6 5.3*Ratings are based on a scale of 1 to 10, where 1 is poor and 10 is excellent.Source: RERC/CCIM Investment Trends Quarterly Survey, 1Q 2009.



While the U.S. economy continues to suffer the ill effects of the post-credit market extremes, there is evidence that the decline is slowing and we are starting to see a few signs of entering into a period (potentially protracted) of stabilization. Warning: This is not to suggest a recovery is on the horizon. We have much yet to work through, and there will be many more ups and downs before we can expect anything resembling a re-covery in jobs and the housing market. But first, we need to stabilize from the worst shocks to our economy and financial markets since the Great Depression.

Despite the Federal Reserve’s extremely accommodative monetary policy and the influx of capital targeted at the in-vestment banks, many of the same issues that threatened the capital markets remain unresolved. Lack of credit continues as a drain on the economy, as we saw recently with the second consecutive 6-percent contraction in GDP, which was attrib-uted mostly to the continued reduction in business investment (which fell 38 percent in first quarter 2009). Although we are seeing some stabilization in the housing market overall, there are many areas that will see additional price declines. In ad-dition, the stress tests the banks have undergone have indi-cated that the health of the banks remains somewhat precari-ous, with many of them needing additional funds to continue to operate. With respect to commercial real estate, the difficul-ties associated with overleveraging continue to drag down the market, and there is much more pain in store for investors.

The economic stresses causing commercial real estate funda-mentals to deteriorate, particularly additional job losses, are expected to continue throughout the year. With consumers remaining cautious, concentrating on expanding their sav-

ings and replenishing their retirement accounts, investors also should expect slow consumer spending to continue. These factors will further negatively impact the office, industrial, re-tail, apartment, and hotel property sectors.

Since commercial real estate is a lagging indicator to the economy, RERC estimates stabilization in the economy to oc-cur before year-end 2009 with strong signs of this in the sec-ond quarter, and commercial real estate following suit approxi-mately 12 months after stabilization occurs in the economy. That means stabilization in the commercial real estate industry will not begin until mid-2010. Until then and as the commer-cial real estate market continues to struggle with new depths, watch for:

• Lack of credit availability in the near term.

• Fundamentals to continue to deteriorate throughout 2009.

• Vacancy/availability rates to increase in all property sec-tors.

• Capitalization rate increases to begin leveling off.

• Property sale prices and rents to continue to decrease.

• Concessions and terms favoring buyers to continue.

• Buy opportunities in CMBS or with distressed debt proper-ties.

Summary



NAR Commercial Forecast: February 20092008 2009

2007 2008 2009I II III IV I II III

OFFICE

Vacancy Rate (%) 12.9 13.2 13.4 13.9 14.7 15.7 16.7 12.5 13.4 16.2

Net Absorption (’000 sq. ft.) 3,192 5,206 4,800 -6,893 -15,091 -17,537 -20,336 57,265 12,271 -77,406

Completions (’000 sq. ft.) 15,701 17,637 21,961 12,888 15,733 16,900 19,306 61,102 68,187 71,356

Inventory (millions sq. ft.) 3,427 3,445 3,467 3,480 3,495 3,512 3,532 3,409 3,480 3,551

Rent Growth (%) 1.0 -0.2 -0.6 -0.6 -0.8 -0.9 -1.2 8.0 -0.4 -4.2

INDUSTRIAL

Vacancy Rate (%) 9.8 9.9 10.7 11.1 11.4 11.7 12.2 9.4 10.4 12.0

Net Absorption (’000 sq. ft.) -12,678 -30,441 -8,327 -5,795 -18,540 -32,552 -44,575 120,231 -57,241 -148,062

Completions (’000 sq. ft.) 34,847 42,847 44,639 57,280 12,214 17,249 35,779 126,765 179,613 69,553


Rent Growth (%) 0.2 0.5 -0.7 -0.8 -0.8 -0.9 -1.2 3.6 -0.8 -4.1

RETAIL

Vacancy Rate (%) 9.0 9.3 9.8 10.8 11.8 12.6 13.4 9.2 9.7 13.0

Net Absorption (’000 sq. ft.) -639 622 -2,157 -8,784 -12,397 -12,503 -12,250 11,081 -7,315 -49,754

Completions (’000 sq. ft.) 5,070 6,296 6,246 8,674 3,483 809 625 29,733 26,286 5,858


Rent Growth (%) 0.7 0.7 0.8 -4.2 -2.2 -2.6 -2.2 3.2 -2.0 -9.0

MULTIFAMILY

Vacancy Rate (%) 5.5 5.4 5.8 6.1 6.0 6.0 6.0 5.4 5.7 6.2

Net Absorption (Units) -52,603 37,680 27,303 12,001 60,112 57,808 56,998 234,399 24,390 127,523

Completions (Units) 56,275 54,573 53,999 55,926 53,894 58,157 55,731 230,932 220,773 214,027

Inventory (Units in Millions) 14.1 14.1 14.2 14.2 14.3 14.3 14.4 14.0 14.2 14.4

Rent Growth (%) 0.9 0.9 0.5 0.6 0.4 0.4 0.5 3.1 2.9 1.7

Sources: NAR, CBRE/Torto Wheaton Research.

NAR U.S. Economic Outlook: May 20092008 Quarterly 2009 Quarterly 2010 Quarterly Annual

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2007 2008 2009 2010

Annual Growth Rate

Real GDP -0.5 -6.3 -6.1 -1.7 0.3 0.8 1.4 2.6 2.5 2.8 2.0 1.1 -2.9 1.4

Nonfarm Payroll Employment -1.5 -3.7 -5.9 -3.7 -2.1 -0.8 0.0 1.0 1.1 1.2 1.1 -0.4 -3.4 -0.2

Consumer Prices 6.2 -8.3 -2.4 0.7 1.8 2.0 2.1 2.2 2.3 2.5 2.9 3.8 -0.8 1.7

Real Disposable Income -8.5 2.7 6.2 -2.0 0.9 0.7 1.3 1.4 2.2 2.6 2.8 1.3 1.3 1.1

Consumer Confidence 57 41 32 43 44 43 42 40 43 45 103 58 41 43

Unemployment 6.0 6.9 8.1 9.4 10.0 10.5 10.4 10.3 10.2 10.1 4.6 5.8 9.5 10.2

Interest Rates, Percent

Fed Funds Rate 1.9 0.5 0.2 0.1 0.1 0.1 0.1 0.8 1.5 2.0 5.0 1.9 0.1 1.1

3-Month T-Bill Rate 1.5 0.3 0.2 0.3 0.3 0.3 0.3 0.9 1.6 2.1 4.4 1.4 0.3 1.2

Prime Rate 5.0 4.1 3.3 2.9 3.0 3.0 3.0 3.3 4.0 4.8 8.1 5.1 3.1 4.1

Corporate Aaa Bond Yield 5.7 5.8 5.3 5.5 5.5 5.5 5.3 5.0 5.0 4.9 5.6 5.6 5.4 5.1

10-Year Government Bond 3.9 3.3 2.7 3.0 3.0 3.1 3.1 3.1 3.3 3.4 4.6 3.7 2.9 3.2

30-Year Government Bond 4.4 3.7 3.5 3.5 3.5 3.7 3.7 3.7 3.9 4.0 4.8 4.3 3.5 3.8

Source: Forecast produced using Macroeconomic Advisers quarterly model of the U.S. economy. Quarterly figures are seasonally-adjusted annual rates. Assumptions and simulations by NAR's Dr. Lawrence Yun.



Snapshot of Real Estate Space and Market Performance – 1Q 2009

Vacancy Rates

Performance Indicator Recent Data Impact on Commercial Real Estate

Rental Rates(RERC’s surveyed rent growth expectations)

Office: 0.7% to 0.9%Industrial: 0.8%Retail: 0.5% to 0.9%Apartment: 1.7%Hotel: 0.7%

RERC’s rental rate expectations for first quarter 2009 were relatively stable when compared to last quarter. Perhaps it is a sign that things are leveling out even though they remain very low during the recession. The only significant moves were a reduction in the average for office and a slight increase for apartments.

Real Estate Returns

RERC Required Returns:Office: 9.4% to 10.0%Industrial: 9.6% to 10.4%Retail: 9.7% to 10.3%Apartment: 9.0%Hotel: 12.7%

NCREIF Realized Returns:Office: -18.5% to -15.0%Industrial: -19.5% to -13.9%Retail: -14.1% to -8.2%Apartment: -16.4%Hotel: -18.2%

RERC’s first quarter 2009 required returns were again up for all property sectors because investors want more return if they are to invest in these troubling times. NCREIF’s realized returns slipped further into negative territory for every sector of commercial real estate.

Capitalization Rates

RERC Realized Cap Rates:Office: 7.1%Industrial: 7.5%Retail: 7.2%Apartment: 5.9%Hotel: 7.5%

NCREIF Implied Cap Rates:Office: 4.6% to 5.4%Industrial: 5.4% to 6.2%Retail: 5.5% to 6.4%Apartment: 4.6%Hotel: 5.2%

RERC’s required going in capitalization rates continued their move up-ward for all property types during first quarter 2009, which is expected until the economy picks up. The implied capitalization rates for NCREIF remained steady for the first quarter 2009. There were no major chang-es to mention from the prior quarter.

12.0

12.5

13.0

13.5

14.0

14.5

15.0

15.5

12.0

12.5

13.0

13.5

14.0

14.5

15.0

15.5

1Q 2009

4Q 2008

3Q 2008

2Q 2008

1Q 2008

4Q 2007

3Q 2007

2Q 2007

1Q 2007

4Q 2006

3Q 2006

2Q 2006

1Q 2006

4Q 2005

3Q 2005

2Q 2005

1Q 2005

Perc

ent

7.0

7.5

8.0

8.5

9.0

9.5

10.0

10.5

7.0

7.5

8.0

8.5

9.0

9.5

10.0

10.5

4Q 2008

3Q 2008

2Q 2008

1Q 2008

4Q 2007

3Q 2007

2Q 2007

1Q 2007

4Q 2006

3Q 2006

2Q 2006

1Q 2006

4Q 2005

3Q 2005

2Q 2005

1Q 2005

Perc

ent

9.0

9.5

10.0

10.5

11.0

11.5

12.0

12.5

9.0

9.5

10.0

10.5

11.0

11.5

12.0

12.5

1Q 2009

4Q 2008

3Q 2008

2Q 2008

1Q 2008

4Q 2007

3Q 2007

2Q 2007

1Q 2007

4Q 2006

3Q 2006

2Q 2006

1Q 2006

4Q 2005

3Q 2005

2Q 2005

1Q 2005

Perc

ent

5.0

5.5

6.0

6.5

7.0

7.5

5.0

5.5

6.0

6.5

7.0

7.5

1Q 2009

4Q 2008

3Q 2008

2Q 2008

1Q 2008

4Q 2007

3Q 2007

2Q 2007

1Q 2007

4Q 2006

3Q 2006

2Q 2006

1Q 2006

4Q 2005

3Q 2005

2Q 2005

1Q 2005

Perc

ent

Source: Torto Wheaton Research.



Source: Reis.

Office Vacancy Rate Retail Availability Rate

Industrial Availability Rate Apartment Vacancy Rate



-7

-5

-3

-1

1

3

5

7

9

-7

-5

-3

-1

1

3

5

7

9

1Q 2009

3Q 2008

1Q 2008

3Q 2007

1Q 2007

3Q 2006

1Q 2006

3Q 2005

1Q 2005

3Q 2004

1Q 2004

3Q 2003

1Q 2003

3Q 2002

1Q 2002

3Q 2001

1Q 2001

3Q 2000

1Q 2000

Perc

ent C

hang

e Q

uart

er A

go

Real gross domestic product (GDP) fell by 6.1 percent during first quarter 2009, making it the second straight quarter in which there was a drop of more than 6 percent and the third consecutive quarter in which the index contracted.

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

Mar-09

Feb-09

Jan-0

9

Dec-08

Nov-08

Oct-08

Sep-08

Aug-08

Jul-0

8

Jun-0

8

May-08

Apr-08

Perc

ent C

hang

e M

onth

Ago

The Consumer Price Index (CPI) contracted slightly during March 2009, although overall it gained for the quarter. CPI has been relatively steady, with energy prices remaining relatively stable for the quarter.

Source: Bureau of Labor Statistics.

Perc

ent

3

4

5

6

7

8

9

3

4

5

6

7

8

9

Apr-09

Oct-08

May-08

Dec-07

Jul-0

7

Feb-07

Sep-06

Apr-06

Nov-05

Jun-0

5

Jan-0

5

Aug-04

Mar-04

Oct-03

May-03

Dec-02

Jul-0

2

Feb-02

Sep-01

Apr-01

Nov-00

Jun-0

0

Jan-0

0

The unemployment rate skyrocketed to 8.9 percent in April, and is expected to continue to climb throughout the year. The manufacturing, service, and construction industries have been hit the hardest.

Source: Bureau of Labor Statistics.

Source: Bureau of Economic Analysis.

Perc

ent

0

1

2

3

4

5

6

7

0

1

2

3

4

5

6

7

Discount Rate

Fed Funds Rate

Apr-09

Aug-08

Dec-07

May-07

Sep-06

Jan-0

6

Jun-0

5

Nov-04

Mar-04

Aug-03

Dec-02

May-02

Oct-01

Apr-01

Oct-00

Feb-00

The Federal Open Market Committee (FOMC) left the federal funds rate in the 0.0 to 0.25 percent range and the discount rate at 0.50 percent, and stated that these rates would remain low for the foreseeable future.

-12

-10

-8

-6

-4

-2

0

2

4

6

8

-12

-10

-8

-6

-4

-2

0

2

4

6

8

Mar-09

Feb-09

Jan-0

9

Dec-08

Nov-08

Oct-08

Sep-08

Aug-08

Jul-0

8

Jun-0

8

May-08

Apr-08

Mar-08

Feb-08

Jan-0

8

Dec-07

Nov-07

Oct-07

Sep-07

Aug-07

Jul-0

7

Year

To Y

ear P

erce

nt C

hang

e

Retail sales improved in January and February 2009, marking the first time since mid-2008 that there was a month-to-month improvement in retail sales. However, consumers pulled back in March, and sales dropped from February levels.

Source: Census Bureau.

65

67

69

71

73

75

77

79

81

83

65

67

69

71

73

75

77

79

81

83

Mar-09

Oct-08

May-08

Dec-07

Jul-0

7

Feb-07

Sep-06

Apr-06

Nov-05

Jun-0

5

Jan-0

5

Aug-04

Mar-04

Oct-03

May-03

Dec-02

Jul-0

2

Feb-02

Sep-01

Apr-01

Nov-00

Jun-0

0

Jan-0

0

Perc

ent

Manufacturing utilization has dropped sharply, and remains lower than the levels reached during the 1980s.

Source: Federal Reserve.

Source: Federal Reserve.

Unemployment

GDP

Consumer Price Index

Manufacturing Utilization

FOMC Policy Decisions

Retail Sales



4.0

4.5

5.0

5.5

6.0

6.5

7.0

7.5

8.0

4.0

4.5

5.0

5.5

6.0

6.5

7.0

7.5

8.0

Mar-09

Sep-08

Mar-08

Sep-07

Mar-07

Sep-06

Mar-06

Sep-05

Mar-05

Sep-04

Mar-04

Sep-03

Mar-03

Sep-02

Mar-02

Sep-01

Mar-01

Mill

ions

Existing home sales fell by 3 percent in March after increasing nearly 5 percent in Febru-ary. There is hope that the industry has reached its low point, and that stabilization is starting to occur.

Source: NAR.

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

2.25

2.50

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

2.25

2.50

Mar-09

Sep-08

Mar-08

Sep-07

Mar-07

Sep-06

Mar-06

Sep-05

Mar-05

Sep-04

Mar-04

Sep-03

Mar-03

Sep-02

Mar-02

Sep-01

Mar-01

Mill

ions

New residential construction declined to its second lowest level ever. Industry watchers are hoping that housing crisis has reached bottom, and that a period of leveling off is underway.

Source: Census Bureau.

9.0

9.5

10.0

10.5

11.0

11.5

9.0

9.5

10.0

10.5

11.0

11.5

Dec-08

Nov-08

Oct-08

Sep-08

Aug-08

Jul-0

8

Jun-0

8

May-08

Apr-08

Mar-08

Feb-08

Jan-0

8

Dec-07

Mon

ths

The February housing supply declined to 9.1 months, slightly less than the January supply and lower than its 12-month average of 9.86.

Source: NAR.

20

40

60

80

100

120

20

40

60

80

100

120

Apr-09

Nov-08

Jun-0

8

Jan-0

8

Aug-07

Mar-07

Oct-06

May-06

Dec-05

Jul-0

5

Feb-05

Sep-04

Apr-04

Nov-03

Jun-0

3

Jan-0

3

Aug-02

Mar-02

Oct-01

May-01

Inde

x

Consumer confidence increased more than expected in April, reaching its highest mark in 5 months. Only 2 short months ago, however, the index marked the worst consumer confidence number in the history of the index.

-6.25

-5.25

-4.25

-3.25

-2.25

-1.25

-0.25

0.75

1.75

-6.25

-5.25

-4.25

-3.25

-2.25

-1.25

-0.25

0.75

1.75

4Q 2008

2Q 2008

4Q 2007

2Q 2007

4Q 2006

2Q 2006

4Q 2005

2Q 2005

4Q 2004

2Q 2004

4Q 2003

2Q 2003

4Q 2002

2Q 2002

4Q 2001

2Q 2001

4Q 2000

2Q 2000

Perc

ent C

hang

e Q

uart

er A

go

The preliminary data for the fourth quarter 2008 Commercial Leading Indicator (CLI) shows a drop of 6.0 percent, the largest decline for this index. The National Association of REALTORS® (NAR) points to the lack of credit in the commercial real estate market as the main reason for the poor numbers.

Source: NAR.

700

800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

700

800

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600

Apr-09

Mar-09

Feb-09

Jan-0

9

Dec-08

Nov-08

Oct-08

Sep-08

Aug-08

Jul-0

8

Jun-0

8

May-08

Apr-08

Mar-08

Feb-08

Jan-0

8

Dec-07

Nov-07

Oct-07

Sep-07

Aug-07

Jul-0

7

Jun-0

7

May-07

Apr-07

Mar-07Be

ginn

ing

of M

onth

Adj

uste

d Cl

osin

g Pr

ice

After working its way to an abysmal 735.09 at the end of February, the S&P 500 has increased 18 percent to its current mark of 872.81, indicating that investors may be testing the waters.

Source: S&P.

Source: The Conference Board.

Consumer Confidence New Residential Construction

S&P 500 Existing Home Sales

Commercial Leading Indicator Single Family Home Supply



A sustained lack of credit and the economic slump will depress the commercial real estate market this year, according to a forward-looking index and forecast for the commercial real estate sectors published by the National Association of REALTORS® (NAR).

Lawrence Yun, NAR chief economist, said all components of the index declined. “The credit crunch has especially hammered down some components of NAR’s commercial leading indicator,” he said. “A lack of commercial credit is a serious threat to the overall economy. The Federal Reserve needs to use the Term Asset-Backed Securities Loan Facility (TALF) to provide liquidity and support for commercial mortgage-backed securities.”

The Commercial Leading Indicator (CLI) for Brokerage Activity fell 6.0 percent to an index of 109.2 in the fourth quarter 2008 from a downwardly revised reading of 116.1 in the third quarter, and is 9.1 percent lower than an index of 120.1 in fourth quarter 2007. NAR’s track of the CLI dates back to 1990.

The slowing index means commercial real estate activity, as measured by net absorption and the completion of new commercial buildings, is likely to weaken further over the next 6 to 9 months.

Given the freeze in commercial credit, investment activity in the commercial real estate sectors has essentially halted, while continuing job losses are reducing the demand for space, according to NAR’s latest COMMERCIAL REAL ESTATE OUTLOOK.3

Realtors® Commercial Alliance Committee chair Robert Toothaker said all sectors are down except for multifamily. “The apartment rental market is more stable simply because home sales are depressed,” he said.

“The stimulus package is designed to create jobs, and that would eventually lead to an upturn in the commercial market,” Toothaker said. “However, we need to quickly restore liquidity to commercial real estate lending so transactions can move forward, and debt on existing properties can be rolled over.”

The NAR forecast for four major commercial sectors analyzes quarterly data in the office, industrial, retail, and multifamily markets. Historic data were provided by Torto Wheaton Research. According to NAR’s findings, vacancy rates are increasing in all property sectors, and annual rent is declining in all property types except for the apartment market.

-------------------------------------------------------

The COMMERCIAL REAL ESTATE OUTLOOK is published by the NAR Research Division for the Realtors® Commercial Alliance (RCA). The RCA, formed by NAR in 1999, serves the needs of the commercial market and the commercial constituency within NAR, including commercial members; commercial committees, subcommittees and forums; commercial real estate boards and structures; and NAR affiliate organizations.

Organizations in the RCA include the CCIM Institute, the Institute of Real Estate Management, the Realtors® Land Institute, the Society of Industrial and Office Realtors®, and the Counselors of Real Estate. The RCA also provides commercial products and services.

More than 81,000 NAR members offer commercial services, and 60,000 of those are currently members of the RCA.

NAR’s CLI is a tool to assess market behavior in the major commercial real estate sectors. That index incorporates 13 variables that reflect future commercial real estate activity, weighted appropriately to produce a single indicator of future market performance, and is designed to provide early signals of turning points between expansions and slowdowns in commercial real estate.

The 13 series in the index are industrial production, the NAREIT (National Association of Real Estate Investment

Trust) price index, NCREIF (National Council of Real Estate Investment Fiduciaries) total return, personal income minus transfer payments, jobs in financial activities, jobs in professional business service, jobs in temporary help, jobs in retail trade, jobs in wholesale trade, initial claims for unemployment insurance, manufacturers’ durable goods shipment, wholesale merchant sales, and retail sales and food service.

NAR reviewed a wide variety of indicators, examined the relationships of indicators that demonstrated a historical impact on commercial real estate, and modeled a forward-looking index based on historic trends. Although individual indicators sometimes move in opposite directions, together they offer a better indication of future market activity.

Quarterly data for 13 selected series were reviewed back through the first quarter of 1990. The modeling demonstrated a change in commercial brokerage activity that could be seen two quarters later as measured by net absorption in the industrial and office sectors, and the completion of new commercial buildings as measured by the value of building construction put-in-place of office, warehouse, retail and lodging structures. An index of 100 is defined as the level of commercial real estate market activity during the first quarter of 1990, the first period to be analyzed.

This information is reproduced in part from the Feb. 19, 2009 press release issued by Realtors Commercial Alliance and with their permission.

Commercial Real Estate ActivityContinuing to Decline

100

105

110

115

120

125

100

105

110

115

120

125

20082007

20062005

20042003

Ind

ex

Commercial Leading Indicator

Source: NAR.



NationalMarketAnalysis

National Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $2 MillionVolume (Mil) $1,879 $3,270 $3,665 $1,504 $101

Size Weighted Avg. ($ per sf/unit) $92 $50 $87 $50,400 $24,651

Price Weighted Avg. ($ per sf/unit) $131 $85 $132 $75,563 $33,579

Median ($ per sf/unit) $98 $60 $91 $57,876 $26,652

$2 - $5 MillionVolume (Mil) $2,986 $4,434 $5,190 $3,454 $481




> $5 MillionVolume (Mil) $49,420 $13,274 $15,151 $25,763 $7,863




All TransactionsVolume (Mil) $54,285 $20,978 $24,006 $30,720 $8,445




Capitalization Rates (All Transactions)Range (%) 3.7 - 12.4 4.0 - 11.0 3.2 - 12.0 3.8 - 12.8 5.5 - 13.0

Weighted Avg. (%) 5.9 7.1 7.0 6.2 7.2

Median (%) 7.0 7.2 6.9 6.5 8.6 Suorce: RERC.

Revised July 1, 2009



NationalMarketAnalysis

National Transaction BreakdownCurrent Quarter Rates (01/01/09 - 03/31/09)

Office Industrial Retail Apartment Hotel< $2 MillionVolume (Mil) $282 $458 $514 $215 $20




$2 - $5 MillionVolume (Mil) $405 $625 $639 $517 $72












Capitalization Rates (All Transactions)Range (%) 4.5 - 10.8 6.6 - 9.2 4.9 - 12.0 3.8 - 12.8 –

Weighted Avg. (%) 6.9 7.4 7.4 7.0 –

Median (%) 7.5 7.6 7.4 6.9 –Source: RERC.


OfficePropertySector



w During first quarter 2009, CCIM designees and candidates who responded to RERC’s survey rated the office sector’s investment conditions rating at 3.7 on a scale of 1 to 10, with 10 being high. The office sector’s rating had been declining since fourth quarter 2007, until this quarter’s in-crease reversed trend.

w RERC’s transaction analysis of the 12-month trailing aver-ages showed continuing declines in the office sector dur-ing first quarter 2009. The volume of transactions contin-ued to slow, while the size-weighted average and median price per square foot fell from last quarter. The weighted average capitalization rate remained stable, while the me-dian capitalization rate increased slightly.

w The return versus risk rating in the office sector increased to 4.6 on a scale of 1 to 10, with 10 being high, during first quarter 2009. This rating tied for the second lowest rating with the hotel sector. The value versus price rating increased to 4.8, up from 4.3 during the previous quarter.

w According to Torto Wheaton Research, the overall vacan-cy rate for the office sector increased by 70 basis points to 14.7 percent during first quarter 2009. The office market posted negative net absorption at a level not seen since fourth quarter 2001.

4%

5%

6%

7%

8%

9%

4%

5%

6%

7%

8%

9%NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08

RERC Weighted Average Capitalization Rate(12-Month Trailing Average)

$100

$200

$300

$400

$500

$600

$700

$800

$100

$200

$300

$400

$500

$600

$700

$800

National

WestMidwestSouthEast

1Q094Q083Q082Q081Q08

RERC Price-Weighted Average PPSF(12-Month Trailing Average)

$100

$150

$200

$250

$300

$350

$400

$100

$150

$200

$250

$300

$350

$400NationalWest

MidwestSouth

East

1Q094Q083Q082Q081Q08

RERC Size-Weighted Average PPSF(12-Month Trailing Average)

OfficeOfficeNational

Most respondents suggested avoiding office property investments for the next year due to “overbuilding, downward pressure on rents, increasing vacancy, and general oversupply.” However, several respondents noted that there are some “small and mid-sized office properties available at great prices in some areas, and if financing becomes available, these kinds of office properties will be a good value.”




IndustrialPropertySector

w CCIM survey respondents rated the investment conditions of the industrial sector at 4.4 on a scale of 1 to 10, with 10 being high, during first quarter 2009. The industrial sec-tor received the second highest rating among the property types.

w RERC’s transaction analysis for the industrial sector showed slightly lower average prices for first quarter 2009. The weighted average capitalization rate increased by 40 basis points to 7.1 percent, while the median capitalization rate increased by 20 basis points.

w The industrial sector received a return versus risk rating of 5.3 on a scale of 1 to 10, with 10 being high, during first quarter 2009, tying for the second highest rating among the property types. The value versus price for the industrial sector was rated at 5.4, indicating the value of the proper-ties outweighs the price.

w The overall availability rate for industrial space increased by 80 basis points to 12.2 percent during first quarter 2009. According to Torto Wheaton Research, this is a higher availability rate than that noted during the last two recessions, and is the highest since Torto Wheaton began tracking data for the industrial sector in 1989.

5%

6%

7%

8%

9%

10%

5%

6%

7%

8%

9%

10%NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


$0

$50

$100

$150

$200

$0

$50

$100

$150

$200NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


$40

$60

$80

$100

$120

$140

$40

$60

$80

$100

$120

$140NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


National

Industrial may be a good sector in which to invest due to pent-up demand in some areas, and “more focus from Congress on U.S. manufacturing and less on off-shore manufacturing.” Long-term industrial may offer good opportunities because the sector has the “shortest ramp-up time” and “requires little capital, high going-in cap rates=instant returns, and a more stable tenant base.” However, in some areas, industrial “still seems to be flat-lining.”




RetailPropertySector

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


$100

$150

$200

$250

$300

$350

$400

$100

$150

$200

$250

$300

$350

$400NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


w CCIM designees and candidates who responded to RERC’s investment survey gave the retail sector an in-vestment conditions rating of 3.4 on a scale of 1 to 10, with 10 being high, during first quarter 2009, which was the lowest rating among the property types.

w According to RERC’s transaction analysis, the decline in volume for retail transactions is beginning to slow. The 12-month size- and price-weighted averages and median price per square foot declined from the previous quarter, while the weighted average capitalization rate increased by 60 basis points to 7.2 percent.

w The retail availability rate increased by 50 basis points to 10.4 percent during fourth quarter 2008, according to Torto Wheaton Research. This was the ninth consecutive quar-ter of increased availability in the retail sector. Net absorp-tion was negative for the second quarter in a row.

w The retail sector received a return versus risk rating of 4.0 on a scale of 1 to 10, with 10 being high, during first quar-ter 2009. Even though this rating was the lowest of all the property types, it was an increase from the previous quar-ter’s rating of 3.3. The value versus price rating increased to 4.5, and indicates that investors still believe the value of the properties is lower than the price being asked.

$50

$100

$150

$200

$250

$50

$100

$150

$200

$250NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


National

Most survey respondents remarked that the retail sector should be avoided during the next year because “tenants have not seen the bottom yet for their retail businesses” and “even the big tenants are weak.” However, there are opportunities, particularly in areas with “properties available at 50 to 70 cents on the dollar” or with “owners with cash flow problems who will be forced to sell.”




ApartmentPropertySector

w CCIM survey respondents gave the apartment sector an investment conditions rating of 5.5 on a scale of 1 to 10, with 10 being high, during first quarter 2009. While the apartment sector was the only property type to be rated lower than the previous quarter, it still received the highest rating among the property types during first quarter.

w RERC’s 12-month trailing transaction analysis for first quarter 2009 showed that the volume of transactions de-clined by approximately 25 percent from the previous quar-ter. The size-weighted average and median prices per unit decreased slightly. The weighted average capitalization rate increased by 60 basis points to 6.2 percent, while the median capitalization rate increased 50 basis points to 6.5 percent.

w According to Reis, Inc., the average vacancy rate for the apartment sector increased by 60 basis points to 7.2 per-cent during first quarter 2009. This is the fifth consecutive quarterly increase in apartment vacancy rates. Net absorp-tion was negative for the second consecutive quarter.

w CCIM survey respondents gave the apartment sector a return versus risk rating of 6.3 on a scale of 1 to 10, with 10 being high, which was up from the previous quarter’s rating of 5.8. This rating indicates the respondents believe the return on apartment properties is greater than the risk involved. The value versus price was rated at 5.2, indicat-ing respondents feel the value of apartment properties only slightly outweighs the price paid.

4.5%

5.5%

6.5%

7.5%

8.5%

4.5%

5.5%

6.5%

7.5%

8.5%NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08

RERC Price-Weighted Average PPU(12-Month Trailing Average)

$50,000

$75,000

$100,000

$125,000

$150,000

$50,000

$75,000

$100,000

$125,000


Midwest

South

East

1Q094Q083Q082Q081Q08

RERC Size-Weighted Average PPU(12-Month Trailing Average)

ApartmentApartmentNational

“Apartments will do well because the home foreclosure market will drive rents up” and because of their “overall stability, occupancy, and NOI.” Apartments are expected to “lead the pack if prices come into line with lenders’ requirements.” However, in some areas, like Phoenix, “too much shadow space from single-family homes is affecting occupancy.”




HotelPropertySector

w CCIM designees and candidates gave the hotel sector an investment conditions rating of 3.7 on a scale of 1 to 10, with 10 being high, during first quarter 2009. The hotel sector’s rating was the second lowest, behind retail.

w The hotel occupancy rate was 56.6 percent as of March 28, 2009, down 12.3 percent from year-ago rates, according to Smith Travel Research. The average daily rate (ADR) de-clined 8.8 percent from year-ago rates, while revenue per available room (RevPAR) declined 20.0 percent.

w The hotel sector’s 12-month trailing transaction activity continued to slow, with an approximate 30-percent decline in transaction volume during first quarter 2009. The size-weighted average and the median prices per unit dropped, while the price-weighted average showed an increase. The weighted average capitalization rate increased by 20 basis points to 7.2 percent, while the median capitalization rate decreased by 30 basis points.

w The hotel sector received a return versus risk rating of 4.6 on a scale of 1 to 10, with 10 being high, which was an in-crease from the previous quarter. This rating indicates that respondents feel the return on hotel properties is still lower than the risk involved. The value versus price rating for ho-tels was 4.7, indicating respondents believe the value of ho-tel properties is less than the price paid.

6%

7%

8%

9%

10%

6%

7%

8%

9%

10%NationalWest

Midwest

South

East

1Q094Q083Q082Q081Q08


$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000National

West

Midwest

South

East

1Q094Q083Q082Q081Q08

RERC Price-Weighted Average PPU(12-Month Trailing Average)

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000


Midwest

South

East

1Q094Q083Q082Q081Q08

RERC Size-Weighted Average PPU(12-Month Trailing Average)

National

Some respondents suggest avoiding hotels due to less business travel this season. Others suggest buying hotels “cheap, because they will bounce back the quickest in a recovering economy” and because they have seen a “drastic reduction in price in the last 12 months and there is lots of upside.”




The first verse from an old hit song called “Nashville Cats” starts this way: “Well, there’s thirteen hundred and fifty two guitar pickers in Nashville.” Recorded by the Lovin’ Spoonful in 1966, the country-themed tune was a somewhat tongue-in-cheek tribute to the Tennessee capitol city and its tre-mendous output of live and recorded country music.

Home to the legendary Grand Ole Opry, Nashville has been the undis-

puted seat of country and its various musical offshoots for decades. In the years following World War II, music pioneers opened small studios along Sixteenth Avenue South on what would be later dubbed “Music Row.” Major record companies like RCA, Decca, and Columbia followed, as did publishing houses, music licensing firms, and other business that served the music industry. Radio networks and radio stations began broadcasts. Giants like Elvis Presley, Chet Atkins, and the Everly Brothers recorded seminal tracks there. Music City was born, and it still lives.

Today, Nashville remains one of the nation’s three music industry meccas, and the vibrant scene draws thou-sands of music fans and professionals from coast to coast, thus contributing to the local economy and preserving a big part of the city’s character. Beyond

the studios and honky tonks, there’s a lot more going on in this progressive, mid-South metropolis.

The seat of Tennessee government, Nashville benefits economically from steady state jobs as well as travel/tourism dollars. Thanks to a strong central city-county government, effec-tive economic development practices, dynamic economic drivers through healthcare, technology, and educa-

By Edward M. Bury, APR

Nashville Tunes inNew Economic Growth...

Beyond the Music

Right:Tennessee

State Capitol

Above: Nashville Music District



tional institutions (there are seven major colleges and universities), over-all affordability, and a central location, Music City dances to a lot of tunes these days and has evolved into a di-verse business center.

According to national publications, Nashville and the state of Tennessee are great places for business. Forbes ranked Nashville as the 25th best U.S. market for career and business growth, and Site Selection magazine, a leading economic develop-ment journal, ranked Tennes-see as having the second-best business climate in the nation. And, Expansion Management ranked Nashville number one in its “50 Hottest Cities” poll for business expansion—for the second consecutive year.

Solid local government is a key reason for the region’s econom-ic success. The metro area of 1.5 million is under the admin-istration of the Metropolitan Government of Nashville and Davidson County, which is com-prised of an elected mayor and Metropolitan Council. Formed in 1963, the government is a consolidation of the two bod-ies—city and county—into a new form of elected administra-tion. According to an excerpt from an online history pub-lished by the Nashville Public Library, “Nashville became the national pioneer in metropolitan organization. Although other

cities had partial consolidation, Nash-ville was the first city in the country to achieve true consolidation.” This con-solidation helped the burgeoning area manage growth and provide needed services as the population shifted to the suburbs in the 1950s.

The local economic development en-gine, the Nashville Area Chamber of Commerce, also is credited with be-ing a catalyst for sound and smart growth.

“We have a truly outstanding cham-ber of commerce,” said Jim Dunn, CCIM, president of Keystone Realty Services of Madison, Tenn., and a 40-year Nashville commercial real es-tate veteran. “Back in the 1970s, the chamber concentrated on luring the smokestack-type of industries, and we got some of those. But one of the leaders had the foresight to say that those really aren’t the kind of jobs we

need in the future—not that we would turn them down.”

Dunn, president of the Middle Tennes-see CCIM Chapter, said new minds on the Chamber later crafted a 10-year plan to bring a wider range of businesses to energize the economy. Their efforts paid off handsomely over the past decade. Dell Computers built its first manufacturing and distribution facility outside of Texas in Nashville, bringing 3,200 jobs. Caremark Phar-macy Services, the parent of the CVS pharmacy retailer, opened its world headquarters in Nashville. The pub-licly-traded Louisiana Pacific Building Materials Company, one of the na-tion’s largest, relocated its corporate headquarters to the city in 2004 from Portland. And, in 2005, automaker Nissan moved its North American headquarters to Franklin, part of the metro area, along with 1,300 jobs. Ac-cording to Expansion Management,

Nashville Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $211 $27 $155 $272 –

Size Weighted Avg. ($ per sf/unit) $168 $31 $176 $63,153 –

Price Weighted Avg. ($ per sf/unit) $175 $33 $238 $81,432 –

Median ($ per sf/unit) $168 $35 $211 $44,030 –

All TransactionsVolume (Mil) $274 $110 $266 $292 $49




Capitalization Rates (All Transactions)Weighted Average (%) 6.8 – 7.2 6.4 –

Median (%) 6.9 – 7.3 6.3 –Source: RERC.

Above: Grand Old Opry




Nissan’s decision marks the 17th cor-porate headquarters announcement in Tennessee since January 2003.

In May, the Chamber reported that 74 companies relocated to or expanded operations in the metro area since late 2008, creating 5,722 new jobs. And, the group is negotiating with 26 other companies on job relocation or reten-tion.

Healthcare is widely considered a sought-after economic driver, and the city has emerged as a leader in that field. Healthcare companies based in the Nashville area employ an esti-mated 430,000 workers globally and more than 94,000 in middle Tennes-see alone. The Hospital Corporation of America (HCA), the largest private operator of health care facilities in the world, was founded in and remains headquartered there.

A key factor also paramount to Nash-ville’s boom is its geographic location. Just about in the center of Tennessee, the market can boast six Interstate highway routes that link Nashville with major distribution points nation-wide. Dunn pointed out that from a demographic perspective, the market is within a 24-hour drive of 75 percent of the U.S. population; and, from a climatic perspective, Nashville en-joys four seasons but avoids the ex-tremes—the average low in January is 28 degrees, and the average high in August is 88 degrees.

Much of Nashville’s economic success in terms of corporate relocations has taken place outside the city’s down-town core. But there is also lots go-ing on downtown on the banks of the Cumberland River. In April 2009, the Metropolitan Council approved a land acquisition bill to borrow up to $75 million for land to build a new conven-tion center, a project pushed by Mayor Karl Dean. Dunn noted that federal stimulus funds should help with major infrastructure projects, like improve-ments to an existing commuter rail system and “some significant bridge enhancements.”

A 24-hour city is emerging as multifam-ily residential properties are open or being developed along Church Street and in pocket neighborhoods like North Capitol, SoBro, and the Gulch. The Nashville Downtown Partnership reports: “More condos were sold in downtown Nashville during the first 2 quarters of 2008 than in all of 2007.

Over 900 condos—more than in the 5 previous years combined—are ex-pected to close by the end of 2008. Over 400 more condos will close in 2009.”

Nashvillians seeking a downtown ad-dress have a lot of options at prices far below comparable properties in other major metro markets. Home seekers can opt for a home at The Viridian, a new, luxury 31-story condo property with unit prices ranging from $214,000 to $1.4 million, or a renovated unit at the Lofts of Werthann Mills, where a condominium home developed in a century-old factory building starts at $134,500 and jumps to $429,900.

These and other multifamily homes are within walking distance of the growing arts and entertainment options down-town—options beyond country music, of course. But rest assured, in Music City the music rarely stops.

Above: Nashville Skyline



B.K. Allen, CCIMB.K. Allen Real EstatePotomac Falls, Virginia

Todd Clarke, CCIMNew Mexico ApartmentsAlbuquerque, New Mexico

Wayne D’Amico, CCIMProperty PoliticsEssex, Connecticut

Paul Fetscher, CCIMGreat American BrokerageLong Beach, New York

Stephen FurnaryING Clarion PartnersNew York, New York

Breck HansonLaSalle Bank, N.A.Chicago, Illinois

Dennis MartinRREEF/DB Real EstateNew York, New York

Jeff Lyon, CCIMGVA Kidder MathewsSeattle, Washington

Buzz McCoyBuzz McCoy Associates, Inc.Los Angeles, California

Tom Nordstrom, CCIMAEGON USA Realty Advisors, Inc.Cedar Rapids, Iowa

Art PasquerellaBerwind Property Group, Inc.Philadelphia, Pennsylvania

Duncan Patterson, CCIMPatterson-Woods AssociatesGreenville, Delaware

Gary M. Ralston, CCIM, SIOR, SRS, CPM, CREFlorida Retail Development, LLCWinter Park, Florida

Cynthia Shelton, CCIMColliers ArnoldOrlando, Florida

Frank Simpson, CCIMThe Simpson CompanyGainesville, Georgia

Allen SmithPrudential Investment Managment ServicesParsippany, New Jersey

Richard SokolovSimon Property GroupIndianapolis, Indiana

John Stone, CCIMJohn M. Stone CompanyDallas, Texas

Dewey Struble, CCIMSperry Van NessReno, Nevada

Julien StudleyJulien Studley, Inc.New York, New York

Allan SweetAMLI Residential Properties TrustChicago, Illinois

Garry Weiss, CCIMFirst Industrial Realty TrustChicago, Illinois

Sam ZellEquity Group InvestmentsChicago, Illinois

RERC~CCIM Investment Trends Quarterly

RERC Editorial Staff

PublisherKenneth P. Riggs, Jr.CFA®, CRE, FRICS, MAI, CCIM

Editor-in-ChiefBarb Bush

Lead AnalystBrian Velky

Research AnalystsGreg PhilippCliff CarlsonCharles GohrMorgan Westpfahl

Design EditorMichelle Houlgrave

Data ManagementBen NeilDaniel Warner

Production CommitteeTerri Cotter

Research AssistantsJeffrey HarmsDavid KellyHerinomena RakotoariveloAnthony Tholkes

CCIM Institute

PresidentCharles “Mac” McClure, CCIM

President-ElectRichard Juge, CCIM

First Vice PresidentFrank Simpson, CCIM

Chief Executive OfficerJonathan Salk

Director of Public RelationsEdward M. Bury, APR

CCIM Member Services CommitteeBrent Case, CCIM, ChairmanMiriam Campos-Root, CCIM, Vice Chairman

Immediate Past ChairmanCCIM Member Services CommitteeSteve Moriera, CCIM

LiasonCCIM Member Services CommitteeKarl Landreneau, CCIM

Advisory Board Members

Copyright Notice for RERC~CCIM Investment Trends Quarterly

Copyright© 2009 by Real Estate Research Corporation (RERC) and the CCIM Institute. All rights reserved. No part of this publication may be reproduced, duplicated, or copied in any form, includ-ing electronic forwarding or copying, xerography, microfilm, or other methods, or incorporated into any information retrieval system, without the written permission of RERC and the CCIM Institute.



Acknowledgements

REALTORS® Commercial Alliance of the National Association of REALTORS®

NAR PresidentCharles McMillan, CIPS

NAR Executive Vice President/CEODale A. Stinton

RCA Committee RepresentativeRobert Toothaker, CPM

NAR Vice President of Commercial Real EstateJan M. Hope

Real Estate Research CorporationFounded more than 75 years ago, Real Estate Research Corporation (RERC) was the nation’s first independent real estate firm that specialized in both real estate research and analysis. Recognized as a pioneer in the art of real es-tate management and for monitoring key sectors of the economy that influence the real estate industry, RERC has retained its place as one of the industry’s leading real estate investment trends analysts through the publication of such reports as Expectations & Market Realities in Real Estate and the RERC Real Estate Report. Today, RERC is known for its research publications and market studies, commercial property valuations, com-plex consulting assignments, portfolio manage-ment and technology services, and independent fiduciary services.

The CCIM InstituteThe CCIM Institute, headquartered in Chicago, confers the Certified Commer-cial Investment Member designation through an extensive curriculum of 200 classroom hours in addition to professional experience requirements. CCIMs are recognized experts in commercial real estate brokerage, leasing, asset management, valuation, and investment analysis, and form a business net-work encompassing more than 1,000 markets throughout North America, Eu-rope, Asia and the Caribbean. There currently are more than 8,600 CCIM designees, with an additional 8,200 professionals pursuing the designation. CCIM Institute is an affiliate of the National Association of REALTORS®. Visit www.ccim.com.

REALTORS® Commercial Alliance of the National Association of REALTORS®

The REALTORS® Commercial Alliance (RCA) is the commercial division of the National Association of REALTORS® (NAR) that connects commercial real es-tate professionals and exchanges valuable information that contributes to their success. RCA in partnership with NAR’s commercial affiliates—CCIM Institute, the Counselors of Real Estate (CRE), the Institute of Real Estate Management (IREM), the REALTORS® Land Institute (RLI), and the Society of Industrial and Office REALTORS® (SIOR)—is dedicated to collaboration with and building on the strengths of each affiliate entity to benefit the real estate industry. RCA works to serve the needs of members, and to shape and unify the commercial real estate industry through valuable products and services, technology initia-tives, public policy advocacy, education, and research.

The RERC/CCIM Investment Trends Quarterly is produced by Real Estate Research Corporation (RERC) in association with and for members of the CCIM Institute. The RERC/CCIM Invest-ment Trends Quarterly is sponsored by the REALTORS® Com-mercial Alliance of the National Association of REALTORS®.



RealEstateResearchCorporation

Founded in 1931, Real Estate Research Corporation is one of the longest-serv-ing and most recognized national firms devoted to real property research, valu-ation, real estate consulting, indepen-dent fiduciary services, and portfolio services.

“

”

Offices located throughout the U.S., with headquarters in Chicago

LeadershipKenneth P. Riggs, Jr.CFA®, CRE, FRICS, MAI, CCIMPresident & CEO

Jules H. Marling, III, CRE, FRICS, MAIManaging Director

Del H. Kendall, CRE, MAIManaging Director

Donald A. Burns, CRE, FRICS, MAIManaging Director

Gregory P. Kendall, CRE, MAIManaging Director

Kent D. Steele, CRE, FRICS, MAIManaging Director

William L. Corbin, MAIManaging Director

Standard PublicationsRERC Real Estate Report

RERC/CCIM Investment Trends Quarterly

Expectations & Market Realities in Real Estate

Real Estate Research Corporation980 North Michigan Avenue, Suite 1110Chicago, IL 60611-4522Phone: 319.352.1500Fax: 319.352.4050www.RERC.com

Explore our services... ■ Specialized Research■ Independent Fiduciary Services■ Fairness Opinions■ Litigation Support■ Consulting■ Portfolio Services■ Commercial Valuation■ Financial Risk Management■ Market Research & Analysis■ Appraisal Management Services

IndependentTo ensure objectivity and independence, RERC does not engage in any activity that may conflict with the best interests of our cli-ents. As an impartial observer of the markets, RERC is able to collect and synthesize data and commentary unavailable to less independent organizations.

UniqueRERC brings unique and diverse skills to solving complex real estate issues. RERC’s innovative approach to problem solving is fostered by the diverse education and professional backgrounds of our team members.

ExpertiseRERC’s expertise originates from a national presence and per-spective, coupled with local market knowledge gained through the completion of hundreds of engagements annually in every major market. Our clients have found that RERC is relationship-oriented, focusing first and foremost on our clients’ and custom-ers’ needs, and delivering the highest quality products and ser-vices. RERC is an SEC-registered advisor.



Trusted Advice. Proven Performance.

Gold

Bronze

Contributors

Adam Abrams RED Brokerage, LLC Kansas City, MO

Sage Andress Sunmark Realty, Inc. Tampa, FL

Brian Andrus Stonebridge Real Estate Co.

Clearwater, FL

Matthew Arnovitz Arnovitz & Associates Dayton, OH

Ray Ault Ault Commercial Realty, Inc.

Proctor, VT

Bo Barron Sperry Van Ness/The Barron Group

Owensboro, KY

James Barse NAI/Latter & Blum Harvey, LA

Amy Bolan Re/Max Commitment Alliance, OH

Ted Booras United Commercial Partners

Jay Boyle Grubb & Ellis|BRE Commercial

San Diego, CA

Sean Carter First National Bank of Chester County

Lancaster, PA

Michael Cliggitt Cliggitt Realty/Cliggitt Valuation

Lakeland, FL

Terry L. Conley TLC - The Location Connection, Inc

Cassville, GA

Chuck Connely C.C. Connely &Associates, LLC

Kansas City, MO

A. Nicholas Coppola CoppolaProperties, Inc.

Needham, MA

Brion Costa Costa LandCorporation

Monrovia, CA

Alan Davidson Eagle Commercial Realty Services

Phoenix, AZ

Petra Della Valle Loewe-AdlerInternational, Inc.

Dallas, TX

Bob Dikman The DikmanCompany

Tampa, FL

Robert W. Drayton City of Charlotte Charlotte, NC

Skip Duemeland DuemelandsCommerical

Bismarck, ND

Brian Frank Kilby Valuations Gilbert, AZ

Richard Gonzalez R+S Realty Group Tavares, FL

Andrew Gutwein Coldwell Banker Com-mercial

Indianapolis, IN

Scot E. Hall Wolf Realty Inc. Glendale, AZ

Dennis Hearst Cushman &Wakefield

San Diego, CA

Charles Huett John H. Huett &Associates

Dallas, TX

Genny Jackson Action Real Estate & Auction LLC

Port Saint Lucie, FL

Steve Jacquemin S.J. FinancialGroup, Inc.

Ellisville, MO

Michael Jeppesen Innovision Property Group

Salt Lake City, UT

David LeCavalier ForeFrontProperties LLC

Northbrook, IL

Chris Leon Realty World Salinas, CA

Ed Light Prudential CRES Tampa, FL

Gerard Marino REMAX Realty Group Fort Myers, FL

Randolph T. Mason Lee & Associates Commercial Real Estate Services

Irvine, CA

Paul McArthur Trillium RealtyAdvisors LLC

Hopewell, NJ

Nicholas L Miner Eagle Commercial Realty Services, AMO

Phoenix, AZ

Dave Murray RB Murray Company Springfield, MO

Edward Neill Ed Neill RealEstate Inv.

San Diego, CA



Bronze

Contributors

Scott Nicholson Boise ValleyCommerc

Seattle, WA

Nick Nicketakis CBS Realtors Waukegan, IL

Danny Overton NAI Commercial Properties

Tulsa, OK

Blake Parker Parker Real Estate Services

Logan, UT

Charles Parmelli Colliers Houston& Co.

Somerset, NJ

James Pasquarella CBRE Wayne, PA

Susan Pfeil Aviva Investors North America, Inc.

Des Moines, IA

Amy Pierce Delta Trust & Bank Little Rock, AR

Daniel Poulin Sealy & Company Metairie, LA

Victoria Pruitt Premier 1 Realty Ponte Vedra, FL

Gaston Reboredo Commercial Real Estate Partners LLC

Boca Raton, FL

Lenore Reynolds Bruce Strumpf, Inc. Clearwater, FL

Richard J. Rossiter Jones Lang LaSalle Orlando, FL

Chip Sanders Waveland Property Group, Inc.

Oak Brook, IL

Kurt A. Schenck High Associates Ltd.

Chris Schreiber Kiemle & Hagood Coeur d’Alene, ID

Ed Schuttenberg CB Richard Ellis St. Louis, MO

A. G. Seifert Babson Capital Chicago, IL

Brian Sorrentino ROI Commercial Real Estate, Inc

Taber Sweet Sturm Realty Group Denver, CO

Alan Tapie Grandbridge Atlanta, GA

Pratt Thomas Merrill P Thomas Co. Mobile, AL

Herb Tousley CBC Griffin Company Minneapolis, MN

Robert B. White Grubb & Ellis 1st Com-mercial

Fort Myers, FL

Steve Williamson Transwestern Dallas, TX

Rafeal Wright Future Home Realty Brooksville, FL

Thank youto all

who sharedinformation

for thisreport.



Scope&MethodologyThe analysis provided in the RERC/CCIM Investment Trends Quarterly is conducted by Real Estate Research Corporation (RERC). The information is gathered in raw form from surveys sent to CCIM designees and candidates, and from sales transactions collected from various sources, including CCIM members, various key commercial information exchange organizations (CIEs), the media, assessors’ offices, RERC contacts in the marketplace, and other reliable public and private resources. All sales transactions are aggregated, analyzed, and reported on by RERC. Additional data and forecasts are provided courtesy of the REALTORS® Commercial Alliance and Torto Wheaton Research.

Published quarterly, the RERC/CCIM Investment Trends Quarterly report provides timely insight into transaction volume, pricing, and capitalization rates for the core income-producing properties.

RERC DefinitionsCapitalization Rate: The capitalization rate is defined as the first year “stabilized” net operating income (NOI) (NOI is before capital expenditures – tenant improvements, leasing commissions, reserves – and debt service) divided by the present value (or purchase price). Capitalization rates included are transac-tion-based medians and price-weighted averages.

RERC Capitalization Rate and Ranges: Capitalization rates and ranges listed throughout this report are based on RERC’s proprietary realized capitalization rate model, which includes available transaction-based capitalization rates, NCREIF Index Returns, and other market factors, but is heavily weighted toward transaction-based capitalization rates for each property type within each market.

Price-Weighted Average: The price-weighted average is developed through weighting each asset based on the gross sales price. Therefore, larger dollar properties are given more weight than the smaller dollar properties, with the weighted average reflecting more weight towards institutional real estate.

Size-Weighted Average: The size-weighted average is developed through weighting each asset based on its gross square footage – simply an aggregation of all the gross sales prices divided by the aggregation of the gross square footage.

National/Regional Market Analysis: RERC ranks the investment potential of the metros and property types it covers based on various space market and financial market criteria, including pricing, capitalization rates, vacancy rates, and other factors.

Investment Conditions Rating: A rating of 1 through 10 (with 10 being high) reflecting survey respondents’ collective views of the investment environment for a particular property type in comparison with other property types. The rating may take into account supply and demand, economic conditions, pricing, rental rates, or other factors.

NCREIF DefinitionsNCREIF: The National Council of Real Estate Investment Fiduciaries (NCREIF) is an independent organization dedicated to the compilation, validation, and distribution of performance data for the institutional real estate investment community.

Total Return: The total return includes appreciation (or depreciation), realized capital gain (or loss), and income. It is computed by adding the income and capital appreciation return on a quarterly basis.

Implied Cap Rate (Income Return): The implied capitalization rate measures the portion of return attributable to each property’s NOI. It is computed by divid-ing the total NOI by the total quarterly investment.

Capital Appreciation Return: The capital appreciation return measures the change in market value adjusted for any capital improvements/expenditures and partial sales divided by the average quarterly investment.

Annual and Annualized Returns: Annual returns are computed by chain-linking quarterly rates of return to produce time-weighted rates of return for the an-nual and annualized periods under study. For time periods beyond 1 year, the annualized returns are expressed as the annual compounded rate of return.

Allocation: The distribution, expressed as a percentage of the overall investment, in a particular geographic area by property type.

For a detailed description of the proceeding returns, as well as the calculations used by NCREIF to derive these figures, please visit http://www.ncreif.org/indi-ces.

The combined returns are the weighted average of the returns for each property type according to the proportionate market value of properties surveyed relative to the total market values surveyed during a time period.

RERC Defined Regions and MSAsWest: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, Wyoming

Midwest: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin

South: Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, Oklahoma, Tennessee, Texas

East: Connecticut, Delaware, Kentucky, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, Washington D.C., West Virginia

Metropolitan Statistical Area (MSA): A geographic unit comprised of one or more counties around a central city or urbanized area with 50,000 or more popu-lation. Contiguous counties are included if they have close social and economic links with the area’s population nucleus.

With a few exceptions, the MSAs within this report coincide with the U.S. Office of Management and Budget’s December 2005 definitions for each MSA. For example, St. Paul, Minn., and Bloomington, Minn., as well as many other suburbs, are included within the Minneapolis MSA.

Note of Caution: It is imperative to exercise caution when comparing the data contained herein to previous reports published by RERC. The data herein is not “fixed,” and will be updated and changed as additional transaction information is gathered and analyzed.

Disclaimer: This publication is designed to provide accurate information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal or accounting service. The publisher advises that no statement in this issue is to be construed as a recommendation to make any real estate investment or to buy or sell a security or as investment advice. The examples contained in the publication are intended for use as back-ground on the real estate industry as a whole, not as support for any particular real estate investment or security. Although the RERC/CCIM Investment Trends Quarterly uses only sources that it deems reliable and accurate, Real Estate Research Corporation (RERC) does not warrant the accuracy of the information contained herein.

The analysis provided in the information is gathered in raw form from surveys sent to CCIM designees and candidates, and from sales transactions collected from various sources, including CCIM members, various key commercial information exchange organizations (CIEs), the media, assessors’ offices, RERC contacts in the marketplace, and other reliable public and private resources. All sales transactions are aggregated, analyzed, and reported on by RERC. Additional data and forecasts are provided courtesy of the REALTORS® Commercial Alliance and Torto Wheaton Research.

Baltimore • Boston • Charlotte • Hartford • New York City • Norfolk Northern New Jersey • Philadelphia • Pittsburgh • Raleigh • Richmond • Washington, D.C.

East Region



EastRegionTransactionBreakdown

n CCIM candidates and designees who responded to RERC’s survey rated the East region’s economic perfor-mance at 4.4 on a scale of 1 to 10, with 10 being high, during first quarter 2009. This rating was a slight increase from the previous quarter’s rating, and tied the East region with the Midwest for the highest ratings among the four regions.

n Nearly two-thirds of the CCIM respondents expect the East regional economy to perform the same over the coming

year, while one-fourth of respondents expect the economy to perform better during the next year.

n Along with lower volume of property sales, RERC’s trans-action analysis for the East region showed declining pric-es and increasing capitalization rates during first quarter 2009.

East Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $2 MillionVolume (Mil) $496 $809 $1,057 $263 $21




$2 - $5 MillionVolume (Mil) $667 $1,094 $1,226 $909 $139













Weighted Avg. (%) 5.5 7.4 7.5 6.2 7.9

Median (%) 7.0 7.5 7.3 6.5 7.8 Source: RERC.




EastRegionTransactionBreakdown

East Transaction BreakdownCurrent Quarter Rates (01/01/09 - 03/31/09)









> $5 MillionVolume (Mil) $3,244 $366 $884 $663 $410




All TransactionsVolume (Mil) $3,437 $627 $1,187 $833 $450





Weighted Avg. (%) 6.8 7.6 8.0 7.5 –


Boston –“Most savvy investors are in a wait-and-hold position. Leasing activity is slow, and lack of comparables exists to estimate fair market.”

Charlotte –“There is discounting of all property types (primarily during negotiations) to prices below that justified by net income. This is creating value acquisitions for savvy investors with patient money.”

Northern New Jersey –“Invest in the best located property in any sector. It will be the first to recover, and should recover stronger. Buy quality.”





$0

$200

$400

$600

$800

$1000

$0

$200

$400

$600

$800

$1000EastU.S. TotalPrice-Weighted Average PPSF

Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfol

k

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore

RERC Price-Weighted Avg. PPSF - 1Q 2009

East Office Transactions (04/01/08 - 03/31/09)Volume

(millions)Size-weighted Average ($/sf)

Price-weighted Average ($/sf)

Median($/sf)

Average Cap Rate (%)

Baltimore $524 $182 $220 $129 6.5

Boston $2,082 $248 $392 $144 7.5

Charlotte $285 $121 $128 $121 7.7

Hartford $97 $66 $97 $96 –

New York $13,646 $584 $849 $251 4.9

Norfolk $153 $118 $125 $100 8.0

Northern NJ $1,123 $210 $261 $151 6.2

Philadelphia $878 $122 $149 $115 6.4

Pittsburgh $137 $80 $109 $69 –

Raleigh $468 $155 $176 $133 –

Richmond $224 $121 $153 $84 –

Washington, D.C. $4,132 $403 $499 $313 6.5

East Total $28,887 $338 $684 $123 5.5

U.S. Total $54,285 $235 $479 $134 5.9 Source: RERC.

$0

$100

$200

$300

$400

$500

$600

$700

$0

$100

$200

$300

$400

$500

$600

$700EastU.S. Total

Size-Weighted Average PPSF

Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfolk

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore

RERC Size-Weighted Avg. PPSF - 1Q 2009

n The 12-month trailing average volume of transactions de-clined by more than 10 percent for the East office sector during first quarter 2009. The price per square foot of of-fice space declined from the previous quarter.

n The 12-month trailing weighted average capitalization rate and the median capitalization rate for the office sector re-mained stable at 5.5 percent and 7.0 percent, respectively.

East

2%

4%

6%

8%

10%

2%

4%

6%

8%

10%EastU.S. TotalAvg. Capitalization Rate

Washin

gton,

D.C.

Philad

elphia

Northe

rn NJ

Norfolk

New Yo

rk

Charlo

tte

Boston

Baltim

ore

RERC Weighted Avg. Cap Rate - 1Q 2009





$0

$50

$100

$150

$200

$0

$50

$100

$150

$200East

U.S. Total

Price-Weighted Average PPSF

Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfolk

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore


2%

4%

6%

8%

10%

2%

4%

6%

8%

10%EastU.S. Total

Avg. Capitalization Rate

Washin

gton,

D.C.

New Yo

rk

Baltim

ore


East Industrial Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Baltimore $426 $66 $100 $63 7.0

Boston $631 $85 $153 $76 –

Charlotte $292 $58 $92 $57 –

Hartford $83 $49 $83 $42 –

New York $983 $119 $176 $131 5.9

Norfolk $57 $76 $104 $70 –

Northern NJ $459 $81 $92 $81 –

Philadelphia $496 $70 $95 $64 –

Pittsburgh $50 $29 $45 $35 –

Raleigh $119 $57 $73 $63 –

Richmond $42 $30 $58 $36 –

Washington, D.C. $459 $133 $155 $128 7.5

East Total $5,779 $63 $109 $63 7.4


$25

$50

$75

$100

$125

$150

$25

$50

$75

$100

$125

$150East

U.S. Total


Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfolk

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore


n The East industrial sector remained relatively stable as compared to the other property types during first quar-ter 2009. The 12-month trailing sales volume declined by approximately 20 percent from the previous quarter. The price per square foot declined slightly.

n The weighted average and median capitalization rates for the East regional industrial sector increased by 30 basis points.

East





$50

$150

$250

$350

$450

$550

$50

$150

$250

$350

$450

$550East

U.S. Total


Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfol

k

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore


5.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

9.0%

5.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

9.0%EastU.S. Total


Washin

gton,

D.C.

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfolk

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore


East Retail Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Baltimore $220 $169 $206 $146 7.6

Boston $345 $156 $304 $123 6.8

Charlotte $328 $126 $167 $96 7.6

Hartford $139 $99 $144 $82 8.3

New York $1,835 $262 $489 $229 7.5

Norfolk $90 $126 $171 $90 8.5

Northern NJ $414 $172 $200 $154 6.9

Philadelphia $287 $145 $208 $116 7.3

Pittsburgh $58 $146 $271 $86 6.5

Raleigh $238 $142 $203 $125 7.9

Richmond $56 $108 $166 $131 –

Washington, D.C. $359 $220 $324 $214 7.4

East Total $6,724 $147 $280 $122 7.5


$0

$50

$100

$150

$200

$250

$300

$0

$50

$100

$150

$200

$250

$300EastU.S. Total


Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfolk

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore


n The 12-month trailing sales volume in the East regional retail sector declined by more than 10 percent during first quarter 2009.

n The first quarter 2009 average and median prices per square foot of retail property declined from the previous quarter. In addition, the weighted average and median capitalization rates for the retail sector increased by 20 basis points and 30 basis points, respectively.

East





$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000EastU.S. Total

Price-Weighted Average PPU

Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfol

k

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore

RERC Price-Weighted Avg. PPU - 1Q 2009

3.5%

4.5%

5.5%

6.5%

7.5%

8.5%

3.5%

4.5%

5.5%

6.5%

7.5%

8.5%EastU.S. TotalAvg. Capitalization Rate

Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore


East Apartment Transactions (04/01/08 - 03/31/09)Volume

(millions)Size-weighted

Average ($/unit)Price-weighted Average ($/unit)

Median($/sf)


Baltimore $213 $89,110 $108,714 $59,792 6.7

Boston $465 $158,945 $207,506 $133,459 5.1

Charlotte $134 $43,496 $59,072 $35,700 6.1

Hartford $241 $98,773 $107,655 $71,133 6.8

New York $3,686 $196,467 $571,846 $113,636 5.5

Norfolk $110 $91,366 $94,740 $77,778 –

Northern NJ $322 $121,165 $175,742 $95,707 5.9

Philadelphia $536 $87,822 $105,982 $65,000 7.5

Pittsburgh $59 $52,254 $75,290 $31,263 8.1

Raleigh $573 $77,998 $92,483 $70,342 6.1

Richmond $180 $111,441 $128,349 $76,042 7.9

Washington, D.C. $2,019 $167,484 $203,654 $155,072 6.6

East Total $10,198 $118,330 $296,408 $90,689 6.2

U.S. Total $30,720 $86,916 $177,941 $79,049 6.2 Source: RERC.

$0

$50,000

$100,000

$150,000

$200,000

$0

$50,000

$100,000

$150,000

$200,000EastU.S. TotalSize-Weighted Average PPU

Washin

gton,

D.C.

Richmon

d

Raleigh

Pittsbu

rgh

Philad

elphia

Northe

rn NJ

Norfol

k

New Yo

rk

Hartfor

d

Charlo

tte

Boston

Baltim

ore

RERC Size-Weighted Avg. PPU - 1Q 2009

n Transaction activity in the East regional apartment mar-ket slowed greatly in first quarter 2009, with the 12-month trailing average sales volume declining nearly 30 percent as compared to the previous quarter.

n The size-weighted average price and median price per apartment unit decreased. The weighted average and median capitalization rates for apartment properties in the East region increased to 6.2 percent and 6.5 percent, re-spectively.

East




HotelPropertySector

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000East

U.S. TotalPrice-Weighted Average PPU

Washin

gton,

D.C.

Richmon

d

Raleigh

Norfol

k

New Yo

rk

Charlo

tte

Boston


East Hotel Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Baltimore – – – – –

Boston $171 $112,725 $168,000 $69,667 –

Charlotte $34 $63,885 $77,433 $51,339 –

Hartford – – – – –

New York $697 $274,810 $356,812 $198,985 –

Norfolk $153 $132,611 $173,200 $137,379 –

Northern NJ – – – – –

Philadelphia – – – – –

Pittsburgh – – – – –

Raleigh $61 $68,244 $103,085 $85,562 –

Richmond $89 $95,489 $109,317 $66,429 –

Washington, D.C. $103 $195,932 $216,014 $134,000 –

East Total $2,283 $123,165 $240,937 $73,390 7.9


$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000EastU.S. Total


Washin

gton,

D.C.

Richmon

d

Raleigh

Norfol

k

New Yo

rk

Charlo

tte

Boston


n The 12-month trailing average hotel volume in the East region declined by more than 25 percent from year-ago levels during first quarter 2009. This is on the heels of a nearly 40-percent decline in fourth quarter 2008, indicat-ing that the pace of declining volume may be slowing.

n The size-weighted average and median prices per ho-tel unit decreased during first quarter 2009. The price-weighted average price per unit increased over last quar-ter.

East


Copyright© 2009 by Real Estate Research Corporation (RERC) and the CCIM Institute.Investment TrendsQuarterly

EastMarketSnapshot

38

RERC extends its appreciation to CBRE/Torto Wheaton Research, which contributed all of the space market information on this page.

East Region Space MarketOffice - 1Q-2009

Inventory SF (000s) Vacancy Rate (%) Net Absorption SF (000s) Asking Rents ($/SF)

Baltimore 54,850 14.4 -133 $22.08 Gross

Boston 162,369 12.3 -1,760 $24.08 Gross

Charlotte 41,186 15.2 -696 $20.41 Gross

Hartford 26,273 18.1 11 $19.54 Gross

New York 438,989 7.4 -2,862 $41.75 Gross

Newark 44,939 14.1 331 $23.95 Gross

Philadelphia 105,219 13.2 -311 $22.17 Net

Pittsburgh 69,109 12.0 183 $18.43 Gross

Raleigh 43,279 13.8 -32 $20.36 Gross

Washington, D.C. 284,052 12.8 -1,133 $32.64 Gross

Industrial - 1Q-2009Inventory SF (000s) Availability Rate (%) Net Absorption SF (000s) Asking Rents ($/SF)

Baltimore 215,826 15.7 -1,370 $5.72 Net

Boston 420,185 15.5 -2,685 $6.65 Net

Charlotte 194,866 11.1 -1,989 $4.94 Net

Hartford 69,811 12.0 -313 $4.85 Net

New York 310,173 11.2 -2,336 $7.45 Net

Newark 214,493 11.0 -2,758 $6.15 Net

Philadelphia 440,903 12.0 -3,562 $5.58 Net

Pittsburgh 140,214 13.6 -1,217 $5.17 Gross

Raleigh 78,469 12.8 -272 $5.68 Net

Washington, D.C. 198,555 14.1 -1,009 $9.48 Net

Retail - 4Q-2008Inventory SF (000s) Availability Rate (%) Net Absorption SF (000s) TWR Rent Index ($/SF)

Baltimore 34,678 7.5 -139 $18.89

Boston 49,485 8.0 -310 $17.89

Charlotte 16,286 10.4 69 $21.43

New York 34,720 9.3 -210 $31.05

Newark 13,698 7.5 -164 $26.43

Philadelphia 56,983 10.6 -53 $21.60

Washington, D.C. 61,886 7.3 51 $23.60

Space Market Data has been provided courtesy of Torto Wheaton Research. Analysis within this report is solely compiled and produced by the Real Estate Research Corporation, and in no way reflects the interpretations, opinions, or conclusions of Torto Wheaton Research.


CBRE/Torto Wheaton Research is a full-service research and investment advisory firm, specializing in com-mercial real estate markets.

With over 20 years of experience, our industry leading research, mar-ket expertise, and strategic partner-ships provide clients with tactical ad-vice and strategic direction to identify market opportunities that enhance performance and manage risk.

CBRE/TWR is internationally rec-ognized for our solid foundation in economics, accurate forecasts, ana-lytical expertise, and providing clients with unparalleled insight into the dy-namics of the real estate market that impact performance.

William WheatonPh.D., Principal

Jon SouthardPrincipal

James CostelloPrincipal


39

Demographics & Economics

Population Unemployment Rate

Baltimore MSA 2.7 million Baltimore2 7.4%

Baltimore Growth1 0.62% Maryland2 7.0%

National Growth1 1.23% National3 8.6%

Household Income & Value

Per Capita Income $32,279 2008 Households 1.0 million

1-year Job Growth -0.90% Household Growth 0.68%

1-Year Job Additions -12,600 Median Home Price $260,100

Major Employers

Constellation Energy

Johns Hopkins Hospital

Verizon

Lifebridge Health

H&S BakerySources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Baltimore Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.

Noteworthy Transactions

Sale Date Sale Price Sq. Ft./Units PPSF/PPU

Office

7222 Ambassador Road 2-09 $2,620,000 22,753 $115

7138 Windsor Blvd. 2-09 $1,890,000 12,000 $158

Industrial

2300 Eskow Ave. 2-09 $1,900,000 13,173 $144

8149 Norris Lane 2-09 $2,300,000 16,050 $143

Retail

9200 Old Annapolis Road 1-09 $2,980,000 15,415 $193

2623 Washington Blvd. 2-09 $639,900 7,080 $90

Apartment

3601 - 3611 Ford’s Lane 1-09 $5,750,000 186 $30,914Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.

Market Construction/Redevelopment Activity

Property Type

New(N)/Refurbished(R)

Total Sq. Ft./Units

Estimated Delivery

The Hyatt at City Center Mixed Use N 450,000 N/A

414 Light St. Office N 475,000 2012

The Fitzgerald at UB Midtown Mixed Use N

280 units

201014,000 retail

Merchants Terminal Corp. DC Industrial N 155,000 2009Sources: CBRE, RE Business.

Balti

mo

re Metro Trend AnalysisPrevious Quarter

Previous Year

Office

Size-Weighted Average PPSF = =

Weighted Average Cap Rate = =

Industrial


Weighted Average Cap Rate –

Retail

Size-Weighted Average PPSF =

Weighted Average Cap Rate

Apartment

Size-Weighted Average PPU


Metro Cap Rate Comparison* Current Quarter

Office

vs. East Region

vs. Nation

Industrial

vs. East Region

vs. Nation =

Retail

vs. East Region =

vs. Nation

Apartment

vs. East Region

vs. Nation

*Comparison of current quarter weighted average capitalization rates.Source: RERC, 1Q 2009.



40

Baltimore Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $5 MillionVolume (Mil) $30 $95 $62 $5 –








All TransactionsVolume (Mil) $524 $426 $220 $213 –




Capitalization Rates (All Transactions)Weighted Average (%) 6.5 7.0 7.6 6.7 –


Baltimore Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 2% 0% -6% -29% –

% Change Year Ago -11% -8% – -16% –

Volume % Change Quarter Ago -9% 4% 0% -40% –

% Change Year Ago -58% -34% – -74% –Source: RERC.



41



Boston MSA 4.5 million Boston2 7.4%

Boston Growth1 0.28% Massachusetts2 8.2%





1-year Job Additons -19,700 Median Home Price $335,700

Major Employers

Massachusetts General Hospital

Boston University

Fidelity Investments Life Insurance

John Hancock Life Insurance Co. USA

Brigham & Women’s Hospital Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Boston Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

10 Brookline Place W 2-09 $62,000,000 155,896 $398

Hartwell Executive Center 3-09 $19,470,000 54,114 $360

Industrial

750 Everett St. 1-09 $9,200,000 390,000 $24

Corporate Place 1-09 $7,900,000 95,000 $83

Retail

35 Central St. 2-09 $9,400,000 14,774 $636

160 Main St. 1-09 $8,600,000 14,500 $593

Apartment

107 Forest Hills St. 2-09 $17,237,500 108 $159,606

278 Newbury 3-09 $3,750,000 10 $375,000

Hotel

Hyatt Regency 3-09 $110,000,000 498 $220,884

15 Middlesex Canal Park 3-09 $8,500,000 196 $43,367Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Clarendon Multifamily N 281 2009

Allison Landing Industrial N 86,000 2010

Franklin St. Luxury Tower Mixed Use R 1,186,000 2011

44 Burbank St. Multifamily N 45 2011Sources: CBRE, RE Business.

Bost

on Metro Trend Analysis

Previous Quarter

Previous Year

Office



Industrial


Retail



Apartment



Hotel



Office

vs. East Region

vs. Nation

Retail

vs. East Region

vs. Nation

Apartment

vs. East Region

vs. Nation




42

Boston Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)









All TransactionsVolume (Mil) $2,082 $631 $345 $465 $171






Boston Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -7% -8% 1% -11% -44%

% Change Year Ago -7% -8% -19% -1% -44%

Volume % Change Quarter Ago -21% -36% -33% 1% -41%

% Change Year Ago -70% -68% -77% -68% -89%Source: RERC.



43



Charlotte MSA 1.7 million Charlotte2 11.4%

Charlotte Growth1 3.05% North Carolina2 10.9%



Per Capita Income $32,343 2008 Households 656,253



Major Employers

Bank of America

Carolinas Healthcare System

Wachovia Corporation

Adecco

Duke Energy Corp.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Charlotte Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Industrial

6125 HarrisTechnology Blvd. 1-09 $5,310,000 148,694 $36

12700 General Drive 2-09 $7,400,000 142,629 $52

Retail

2500 South Blvd. 1-09 $2,500,000 50,000 $50

7101 Smith Corners Blvd. 3-09 $6,900,000 48,235 $143Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Hillsborough & Dawson St. Mixed Use N N/A 2010

500 W. Trade Multifamily N 400 2009

Elizabeth Avenue Mixed Use N

590,000 retail/office

2010850 units

Duke Energy Center Office N 1,200,000 2010Sources: CBRE, RE Business.

Cha

rlott

e Metro Trend AnalysisPrevious Quarter

Previous Year

Office



Industrial


Retail



Apartment



Hotel



Office

vs. East Region

vs. Nation

Retail

vs. East Region =

vs. Nation

Apartment

vs. East Region =

vs. Nation =*Comparison of current quarter weighted average capitalization rates.Source: RERC, 1Q 2009.



44

Charlotte Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Charlotte Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% 4% -1% -26% 1%

% Change Year Ago -12% 7% -7% -36% -31%

Volume % Change Quarter Ago -13% -43% -18% -48% -34%




45



Hartford MSA 1.2 million Hartford2 7.8%

Hartford Growth1 0.45% Connecticut2 7.8%






Major Employers

Aetna Inc.

Hartford Hospital

Hartford Financial SVC Group

United Technologies Corporation

Uniprise Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Hartford Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

17 Talcott Notch Road 2-09 $2,990,000 35,326 $85

Industrial

185 W. Service Road 2-09 $7,800,000 23,000 $339

Retail

Horizon Commons 1-09 $18,000,000 108,208 $166

Stop & Shop Plaza 3-09 $15,500,000 122,718 $126 Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Yale University Health Center Office N 146,000 2010

William Clark Mixed Use R58 units + 9,000 sf 2010

100 International Drive Industrial N 304,200 N/ASources: CBRE, RE Business.

Ha

rtfo

rd Metro Trend AnalysisPrevious Quarter

Previous Year

Office


Industrial


Retail


Weighted Average Cap Rate = –

Apartment



Retail

vs. East Region

vs. Nation




46

Hartford Transaction Breakdown12-Month Trailing Averages (04/01/08 - 03/31/09)













Capitalization Rates (All Transactions)Weighted Average (%) – – 8.5 6.8 –

Median (%) – – 8.0 6.8 –Source: RERC.

Hartford Transaction Trends12-Month Trailing (04/01/08 - 03/31/09

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -6% -10% -1% 13% –

% Change Year Ago 11% -19% 9% – –

Volume % Change Quarter Ago -38% -41% 3% -2% –

% Change Year Ago -26% -64% -45% – –Source: RERC.



47



New York MSA 19.1 million New York2 8.1%

New York Growth1 0.44% New York2 8.1%






Major Employers

Ernst & Young

Mount Sinai Medical Center

Memorial Sloan Kettering

American Express Co.

Pfizer Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - New York Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

New York Times HQ 3-09 $225,000,000 750,000 $300

415 W. 13th St. 3-09 $18,000,000 68,000 $265

Industrial

5-33 48th Ave. 3-09 $13,500,000 55,992 $241

600 - 604 Union St. 1-09 $3,400,000 10,000 $340

Retail

644-652 E. 14th St. 2-09 $12,300,000 9,566 $1,286

Voice Road Plaza 2-09 $36,200,000 131,850 $275

Apartment

2829 Sedgwick Ave. 3-09 $9,100,000 99 $91,919

150 W. 84th St. 3-09 $5,350,000 20 $267,500Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

625 W. 140th St. Multifamily N 114 2010

Tower of the World Trade Center Office R 1,300,000 2013

Beekman Tower Mixed Use N 121,000/902 2010

34 Berry St. Multifamily N 142 2010

Hyatt Place -Nevins St. Hotel N 174 2011Sources: CBRE, RE Business.

Ne

w Y

ork

City Metro Trend Analysis

Previous Quarter

Previous Year

Office


Weighted Average Cap Rate =

Industrial


Retail



Apartment



Hotel



Office

vs. East Region

vs. Nation

Industrial

vs. East Region

vs. Nation

Retail

vs. East Region =

vs. Nation

Apartment

vs. East Region

vs. Nation




48

New York Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $13,442 $601 $1,232 $3,040 $693




All TransactionsVolume (Mil) $13,646 $983 $1,835 $3,686 $697






New York Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -11% 0% -5% -9% -22%

% Change Year Ago -35% -6% -3% -9% -5%





49



Norfolk MSA 1.7 million Norfolk2 6.9%

Norfolk Growth1 0.90% Virginia2 7.0%




1-year Job Growth 1.00% Household Growth 1.04%

1-Year Job Additions 7,700 Median Home Price $222,000

Major Employers

Northrop Grumman

Sentara Healthcare

Old Dominion University

Norfolk Naval Shipyard

City of NorfolkSources: Bureau of Labor Statistics, NAR, STDB Online. “2008 Local Market Report” - Virginia Beach Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

621 Lynnhaven Parkway 2-09 $7,800,000 82,000 $95

380 Cleveland Place 3-09 $1,300,000 11,780 $110

Industrial

875 Middle Ground Blvd. 3-09 $5,100,000 62,052 $82

1429 Miller Store Road 2-09 $5,600,000 45,926 $122

Retail

Salem Lakes Marketplace 2-09 $2,550,000 42,807 $60Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Wachovia Center Office/Retail N 300,000 2010Sources: CBRE, RE Business.

No

rfo

lk Metro Trend AnalysisPrevious Quarter

Previous Year

Office


Industrial


Retail



Apartment


Hotel



Office

vs. East Region

vs. Nation

Retail

vs. East Region

vs. Nation




50

Norfolk Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $5 MillionVolume (Mil) $21 $32 $31 – –

Size Weighted Avg. ($ per sf/unit) $100 $67 $96 – –

Price Weighted Avg. ($ per sf/unit) $110 $114 $196 – –

Median ($ per sf/unit) $99 $66 $80 – –

> $5 MillionVolume (Mil) $132 – – $101 $150

Size Weighted Avg. ($ per sf/unit) $121 – – $94,082 $147,668

Price Weighted Avg. ($ per sf/unit) $128 – – $96,924 $176,161

Median ($ per sf/unit) $104 – – $99,023 $138,889





Capitalization Rates (All Transactions)Weighted Average (%) 8.0 – 8.5 – –

Median (%) 8.2 – 8.6 – –Source: RERC.

Norfolk Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 1% 10% -13% 0% –

% Change Year Ago -28% 10% -33% -5% –

Volume % Change Quarter Ago -4% -44% -67% -19% –

% Change Year Ago -36% -68% -65% -59% –Source: RERC.



51



Newark (City) 281,000 Newark2 –

Newark Growth1 0.40% New Jersey2 8.7%



Per Capita Income N/A 2006 Households N/A

1-year Job Growth - Newark -0.60%

2006 Household Growth N/A

1-Year Job Additions - Newark -6,400 Median Home Price $373,600

Major Employers

Continental Airlines

University of Medicine/Dentistry

Prudential Financial Inc.

MT Carmel Guild-Mental Health Service

Newark Beth Israel Medical CenterSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Newark Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

275 Old Brunswick Road 3-09 $6,950,000 55,625 $125

355 Madison Ave. 2-09 $6,000,000 20,000 $300

Industrial

140 Docks Corner Road 1-09 $42,500,000 583,376 $73

4007 - 4015 Park Ave. 2-09 $3,100,000 17,500 $177

Retail

901 Mountain Ave. 1-09 $10,100,000 66,000 $153

Apartment

Northwood Estates 1-09 $27,500,000 253 $108,696

Hotel

Wellesley Inn 2-09 $1,400,000 108 $12,963Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Rickard Stockton College of New Jersey Office N 153,000 2011

Aurora Over the Hudson Multifamily N 131 2010

Richardson Building Lofts Multifamily R 67 2009

The Richwood Village Mixed Use N1 million sf & 1,200 units 2010

Liberty Plaza Office N 430,000 N/ASources: CBRE, RE Business.

No

rthe

rn N

ew

Je

rse

y Metro Trend AnalysisPrevious Quarter

Previous Year

Office



Industrial


Retail



Apartment


Size-Weighted Average PPU –


Office

vs. East Region

vs. Nation

Retail

vs. East Region

vs. Nation =

Apartment

vs. East Region

vs. Nation




52

Northern NJ Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $1,082 $362 $322 $274 –




All TransactionsVolume (Mil) $1,123 $459 $414 $322 –






Northern NJ Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 3% -4% -13% -2% –

% Change Year Ago 5% -13% -15% -16% –





53



Philadelphia MSA 5.9 million Philadelphia2 8.1%

Philadelphia Growth1 0.44% Pennsylvania2 8.2%






Major Employers

General Services Admin. GSA

Philadelphia International Airport

Temple University Physicians

U.S. Post Office

Ace InternationalSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Philadelphia Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

777 Township Line Road 1-09 $21,000,000 110,000 $191

1000 N. Cedar Hollow Road 2-09 $19,500,000 357,658 $55

Industrial

200 Sears Blvd. 2-09 $8,420,000 251,912 $33

117 Crown Point Road 1-09 $12,200,000 183,570 $66

Retail

282 - 304 N. Sycamore St. 3-09 $14,870,000 35,653 $417

Tractor Supply Co. 1-09 $6,040,000 22,670 $266

Apartment

1324 Phoenixville Pike 2-09 $26,500,000 212 $125,000

2610 Philadelphia Pike 2-09 $12,600,000 206 $61,165Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Cira Centre South Mixed Use N 733,000 2010

Waldorf-Astoria Hotel and Residences

Hotel/Multifamily N 311 2012

2.0 University Place Office N 94,350 N/A

Horizon Corporate Center II Office N 200,000 2012

American Commerce Center Office/Hotel N 2,200,000 2012Sources: CBRE, RE Business.

Phila

de

lphi

a Metro Trend AnalysisPrevious Quarter

Previous Year

Office



Industrial


Retail



Apartment




Office

vs. East Region

vs. Nation

Retail

vs. East Region

vs. Nation

Apartment

vs. East Region

vs. Nation




54

Philadelphia Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Philadelphia Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -4% 2% 11% -11% –

% Change Year Ago -13% 11% 2% -24% –





55



Pittsburgh MSA 2.4 million Pittsburgh2 7.6%

Pittsburgh Growth1 -0.26% Pennsylvania2 8.2%




1-year Job Growth -0.60% Household Growth -0.13%


Major Employers

University of Pittsburgh Medical Center Health System

Commonwealth of Pennsylvania

University of Pittsburgh

Mellon Financial Corp.

The PNC Financial Service Group Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Pittsburgh Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

1195 Washington Pike 3-09 $3,750,000 44,886 $84

300 Industry Drive 1-09 $28,000,000 189,000 $148

Industrial

517 Woodward Drive 2-09 $1,500,000 62,000 $24

791 Commonwealth Drive 3-09 $1,344,000 42,000 $32

Retail

2055 Washington Pike 2-09 $6,000,000 14,550 $412

7628 Penn Ave. 2-09 $5,750,000 14,820 $388Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

WestinghouseElectric Corporation Office N 775,000 2010

Courtyard by Marriott Hotel N 124 2010

Cambridge Venture Partners Office N 45,000 N/A

WestmorelandTechnology Park Industrial N 60,000 N/ASources: CBRE, RE Business.

Pitt

sbur

gh Metro Trend Analysis

Previous Quarter

Previous Year

Office


Industrial


Retail



Apartment



Retail

vs. East Region

vs. Nation

Apartment

vs. East Region

vs. Nation




56

Pittsburgh Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $103 – $35 $54 –

Size Weighted Avg. ($ per sf/unit) $87 – $188 $56,332 –

Price Weighted Avg. ($ per sf/unit) $121 – $313 $79,651 –

Median ($ per sf/unit) $148 – $388 $41,166 –







Pittsburgh Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago – -31% -6% 10% –

% Change Year Ago 11% -20% -24% -18% –

Volume % Change Quarter Ago – -33% 21% 58% –




57



Raleigh MSA 1.1 million Raleigh2 8.6%

Raleigh Growth1 3.59% North Carolina2 10.9%





1-Year Job Additions 200 Median Home Price $230,900

Major Employers

North Carolina State University

Wake Medical North Healthplex

Rex Hospital

Progress Energy

Wake County Public SchoolsSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Raleigh Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of December 2008. 3Rates are non-seasonally adjusted as of February 2009.



Office

5560 Munford Road 2-09 $2,320,000 18,300 $127

4100 Wake Forest Road 3-09 $1,650,000 6,232 $265

Industrial

3211 S. Miami Blvd. 1-09 $6,440,000 140,009 $46

5200 Atlantic Ave. 3-09 $1,900,000 19,742 $96

Retail

Pinecrest Pointe Shopping Center 3-09 $7,000,000 89,224 $78

Apartment

2916 & 2918 Chapel Hill Road 1-09 $1,170,000 12 $97,500Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Hyatt at City Center Mixed Use N 450,000 N/A

414 Light St. Office N 475,000 2012

The Fitzgerald at UB Midtown Mixed Use N

280 units

201014,000 retail

Merchants Terminal Corp DC Industrial N 155,000 2009Sources: CBRE, RE Business.

Rale

igh Metro Trend Analysis

Previous Quarter

Previous Year

Office


Industrial


Retail



Apartment

Size-Weighted Average PPU = =


Hotel



Retail

vs. East Region

vs. Nation

Apartment

vs. East Region =




58

Raleigh Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $387 $40 $179 $550 $53










Raleigh Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% -4% -20% 3% –

% Change Year Ago -1% -4% -21% 2% –

Volume % Change Quarter Ago 2% 8% 3% -53% –




59



Richmond MSA 1.2 million Richmond2 7.8%

Richmond Growth1 1.42% Virginia2 7.0%






Major Employers

Virginia Commonwealth University

Museum of Fine Arts

Philip Morris USA

Richmond City Offices

State PoliceSources: Bureau of Labor Statistics, NAR, STDB Online.1Projected annual growth over 5 years (2007-2012). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

9920 Independence Park Drive 2-09 $3,416,000 15,050 $227

8080 Villa Park Drive 2-09 $1,900,000 27,078 $70

Industrial

S & K Famous Brands HQ 3-09 $5,875,000 209,000 $28

8191 Staples Mill Road 1-09 $1,000,000 9,600 $104

Retail

7301 Staples Mill Road 2-09 $1,030,000 16,118 $64

8101 W. Broad St. 2-09 $2,410,000 15,981 $151Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

MeadWestvacoHeadquarters Office N 310,000 2009

1812 Monroe St. Office N 580,000 2011

The Corner atShort Pump Mixed Use N 238,000 2010

Parham Forest Industrial N 36,000 N/ASources: CBRE, RE Business.

Ric

hmo

ndMetro Trend Analysis

Previous Quarter

Previous Year

Office


Industrial


Retail


Apartment


Hotel



Apartment

vs. East Region

vs. Nation




60

Richmond Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $201 – – $177 $84

Size Weighted Avg. ($ per sf/unit) $129 – – $113,262 $97,851

Price Weighted Avg. ($ per sf/unit) $159 – – $129,482 $111,684

Median ($ per sf/unit) $121 – – $139,925 $73,374





Capitalization Rates (All Transactions)Weighted Average (%) – – – 7.9 –

Median (%) – – – 7.9 –Source: RERC.

Richmond Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -15% -6% 7% 15% -1%

% Change Year Ago -26% -13% – – -21%

Volume % Change Quarter Ago -17% 6% -24% 6% -34%

% Change Year Ago -40% -71% – – -58%Source: RERC.



61



Washington, D.C. MSA 5.5 million Washington, D.C.2 5.9%

Washington, D.C. Growth1 1.64% District of Columbia2 9.5%





1-Year Job Additions 11,800 Median Home Price $295,100

Major Employers

George Washington University

WMATA

Federal Bureau of Investigation

Multilateral Investment Grant

Smithsonian InstitutionSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Washington D.C. Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

1300 Connecticut Ave. 3-09 $63,600,000 117,594 $541

1225 19th St. NW 1-09 $26,200,000 72,756 $360

Industrial

2270 Beaver Road 3-09 $7,100,000 78,800 $90

Retail

4312 Markham St. 2-09 $5,900,000 25,383 $232

4600 - 4614 Wisconsin Ave. 2-09 $5,000,000 21,582 $232

Apartment

Inverness Knolls 2-09 $8,200,000 44 $186,364

Hotel

Embassy Inn 2-09 $5,092,000 38 $134,000Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

401 M St. SE Office/Retail N 330,000 2010

1050 31st St. Office R 50,000 N/A

Watkins Mill Town Center Office N 487,000 2009

Waterfront Station Mixed Use N 2,500,000 2010

700 2nd St. NE Office N 515,000 2009Sources: CBRE, RE Business.

Wa

shin

gto

n, D

.C.

Metro Trend AnalysisPrevious Quarter

Previous Year

Office



Industrial



Retail



Apartment



Hotel



Office

vs. East Region

vs. Nation

Industrial

vs. East Region =

vs. Nation

Retail

vs. East Region =

vs. Nation

Apartment

vs. East Region

vs. Nation




62

Washington, D.C. Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $4,073 $376 $298 $2,002 $103




All TransactionsVolume (Mil) $4,132 $459 $359 $2,019 $103






Washington, D.C. Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 3% -2% 7% – -40%

% Change Year Ago 0% 11% 1% – 14%

Volume % Change Quarter Ago -15% -5% -6% – -60%

% Change Year Ago -71% -30% -68% – -95%Source: RERC.


Atlanta • Austin • Dallas/Ft. Worth • Houston • Memphis • Miami • Nashville New Orleans/Baton Rouge • Oklahoma City • Orlando • San Antonio • Tampa

South Region



SouthRegionTransactionBreakdown

South Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $2 MillionVolume (Mil) $545 $800 $1,154 $255 $33




$2 - $5 MillionVolume (Mil) $671 $847 $1,399 $525 $114













Weighted Avg. (%) 7.2 7.2 7.2 6.8 8.5


n CCIM members who responded to RERC’s survey rated the South region’s first quarter 2009 economic perfor-mance at 4.1 on a scale of 1 to 10, with 10 being high. While this rating was a slight increase from the previous quarter’s rating of 4.0, it was the lowest rating received among the four regions during the current quarter.

n Nearly half of the South region’s survey respondents ex-pect the region’s economy to perform the same over the

coming year, while slightly more than one-fourth of re-spondents expect the economy to perform worse.

n Transaction volume continued to decline for all property types in the South region during first quarter 2009, while prices remained relatively stable.




SouthRegionTransactionBreakdown

South Transaction BreakdownCurrent Quarter Rates (01/01/09 - 03/31/09)

















Capitalization Rates (All Transactions)Range (%) 7.0 - 10.6 – 7.0 - 9.3 4.0 - 12.8 –

Weighted Avg. (%) 8.1 – 8.1 7.7 –

Median (5) 7.5 – 8.1 8.5 –Source: RERC.

Miami –“I see more foreign buyers than ever—Brazil, Venezuela, Germany. Many start looking at residential first, but the trend is REOs. They are waiting on commercial. There is no doubt they will buy.”

Oklahoma City –“There are lots of renewing leases, and lots of property owners holding their property and putting equity into it.”

Tampa –“Lease rates and asking prices are down some 30 percent.”





$0

$100

$200

$300

$400

$500

$0

$100

$200

$300

$400

$500

South

U.S. TotalPrice-Weighted Average PPSF

Tampa

San Anto

nio

Orland

o

Oklaho

ma City

New O

rlean

s/

Baton R

ouge

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


4%

5%

6%

7%

8%

9%

10%

4%

5%

6%

7%

8%

9%

10%SouthU.S. Total


Orland

o

Oklaho

ma City

Nashv

ille

Miami

Housto

nDall

as/

Ft. W

orth

Austi

n

Atlan

ta


South Office Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Atlanta $1,534 $170 $200 $125 7.9

Austin $319 $219 $245 $155 6.5

Dallas/Ft. Worth $1,698 $180 $203 $104 7.8

Houston $842 $172 $183 $126 7.1

Memphis $64 $95 $119 $98 –

Miami $1,507 $259 $327 $162 5.9

Nashville $274 $148 $167 $117 6.8

New Orleans/Baton Rouge $139 $75 $89 $55 –

Oklahoma City $128 $87 $125 $75 7.1

Orlando $195 $168 $204 $177 8.0

San Antonio $83 $127 $144 $104 –

Tampa $258 $126 $135 $121 –

South Total $9,033 $161 $210 $120 7.2


$0

$50

$100

$150

$200

$250

$300

$0

$50

$100

$150

$200

$250

$300SouthU.S. TotalSize-Weighted Average PPSF

Tampa

San Anto

nio

Orland

o

Oklaho

ma City

New O

rlean

s/

Baton R

ouge

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


n The 12-month trailing office sales volume declined approxi-mately 15 percent during first quarter 2009 as compared to the previous quarter. Both the size- and price-weighted aver-age prices per square foot of office space increased, while the median price per square foot decreased.

n The weighted average capitalization rate for the South re-gion’s office market remained stable,while the median capi-talization rate decreased by 10 basis points, during first quar-ter 2009.

South





$0

$50

$100

$150

$200

$250

$300

$0

$50

$100

$150

$200

$250

$300South

U.S. Total


Tampa

San Anto

nio

Orland

o

Oklaho

ma City

Nashv

ille

Miami

Memph

is

Housto

n

Dallas

/Ft. W

orth

Austin

Atlanta


South Industrial Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Atlanta $632 $50 $72 $63 7.3

Austin $53 $215 $264 $79 –

Dallas/Ft. Worth $311 $48 $69 $46 7.3

Houston $85 $41 $54 $49 –

Memphis $71 $25 $28 $32 –

Miami $452 $82 $102 $90 –

Nashville $110 $38 $50 $43 –

New Orleans/Baton Rouge – – – – –

Oklahoma City $118 $22 $41 $49 –

Orlando $188 $78 $109 $83 –

San Antonio $16 $41 $46 $45 –

Tampa $211 $61 $78 $67 –

South Total $3,532 $49 $77 $56 7.2


$0

$50

$100

$150

$200

$250

$0

$50

$100

$150

$200


Tampa

San Anto

nio

Orland

o

Oklaho

ma City

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


n The 12-month trailing transaction volume for industrial properties in the South region decreased by nearly 15 per-cent during first quarter 2009 as compared to the previous quarter, while pricing remained mostly stable.

n The weighted average and the median capitalization rates for the industrial sector decreased during first quarter 2009 to 7.2 percent and 7.4 percent, respectively.

South


5%

6%

7%

8%

9%

10%

5%

6%

7%

8%

9%

10%SouthU.S. TotalAvg. Capitalization Rate

Dallas

/

Ft. W

orth

Atlanta





$0

$50

$100

$150

$200

$250

$300

$350

$0

$50

$100

$150

$200

$250

$300

$350SouthU.S. Total


Tampa

San Anto

nio

Orland

o

Oklaho

ma City

New O

rlean

s/

Baton R

ouge

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


2%

4%

6%

8%

10%

2%

4%

6%

8%

10%SouthU.S. Total


Tampa

Orland

o

Nashv

ille

Miami

Housto

n

Dallas

Atlanta


South Retail Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Atlanta $882 $157 $199 $155 7.1

Austin $65 $189 $229 $189 –

Dallas/Ft. Worth $463 $105 $161 $94 7.3

Houston $314 $129 $180 $97 7.7

Memphis $164 $128 $177 $105 –

Miami $747 $157 $234 $175 7.0

Nashville $266 $153 $215 $119 7.2

New Orleans/Baton Rouge $32 $45 $77 $56 –

Oklahoma City $140 $81 $118 $76 –

Orlando $411 $194 $220 $167 7.3

San Antonio $212 $139 $215 $95 –

Tampa $270 $110 $173 $107 8.0

South Total $6,654 $127 $194 $108 7.2


$0

$50

$100

$150

$200

$0

$50

$100

$150


Tampa

San Anto

nio

Orland

o

Oklaho

ma City

New O

rlean

s/

Baton R

ouge

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


n The transaction volume in the South regional retail market during first quarter 2009 declined by about 10 percent from the previous quarter. Prices remained relatively stable.

n Both the weighted average and median capitalization rates for retail properties increased to 7.2 percent.

South





$0

$50,000

$100,000

$150,000

$200,000

$0

$50,000

$100,000

$150,000

$200,000

South

U.S. Total


Tampa

San A

ntonio

Orland

o

Oklaho

ma City

New O

rlean

s/

Baton

Rou

ge

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austi

n

Atlan

ta


South Apartment Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Atlanta $1,533 $72,122 $89,156 $55,556 6.1

Austin $458 $83,171 $87,028 $73,147 –

Dallas/Ft. Worth $853 $49,188 $67,148 $38,258 7.5

Houston $448 $34,559 $57,487 $28,125 7.7

Memphis $124 $40,242 $61,841 $24,089 6.5

Miami $487 $85,286 $118,234 $73,000 7.0

Nashville $292 $61,371 $79,296 $43,403 6.4

New Orleans/Baton Rouge $7 $6,200 $20,860 $34,444 –

Oklahoma City $206 $57,243 $72,404 $35,859 7.4

Orlando $340 $81,871 $93,355 $60,577 –

San Antonio $118 $51,055 $73,777 $42,994 –

Tampa $450 $68,899 $89,375 $59,507 7.5

South Total $7,325 $58,591 $80,164 $46,021 6.8


$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000SouthU.S. Total


Tampa

San Anto

nio

Orland

o

Oklaho

ma City

New O

rlean

s/

Baton R

ouge

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


n The 12-month trailing transaction volume of the South re-gional apartment market declined about 25 percent during first quarter 2009 as compared to the previous quarter.

n Pricing in the South regional apartment market continued to decline. Both the weighted average and median capital-ization rates increased 20 basis points from the previous quarter.

South

0%

2%

4%

6%

8%

10%

0%

2%

4%

6%

8%

10%SouthU.S. TotalAvg. Capitalization Rate

Tampa

Oklaho

ma City

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Atlanta





HotelPropertySector

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000South


Tampa

Orland

o

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


South Hotel Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Atlanta $52 $37,779 $43,444 $38,372 –

Austin $51 $133,333 $146,354 $134,409 –

Dallas/Ft. Worth $259 $110,506 $131,188 $122,346 –

Houston $124 $136,817 $178,286 $101,556 –

Memphis $22 $58,826 $61,773 $54,287 –

Miami $984 $385,860 $701,705 $122,540 –

Nashville $49 $48,418 $55,281 $47,414 –

New Orleans/Baton Rouge – – – – –

Oklahoma City – – – – –

Orlando $145 $51,080 $71,511 $47,976 –

San Antonio – – – – –

Tampa $72 $58,255 $72,315 $43,498 –

South Total $2,118 $112,659 $383,283 $60,377 8.5


$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

SouthU.S. TotalSize-Weighted Average PPU

Tampa

Orland

o

Nashv

ille

Miami

Memph

is

Housto

nDall

as/

Ft. W

orth

Austin

Atlanta


n The transaction volume of hotels in the South region con-tinued to decline. The size-weighted average price and median price per unit decreased from the previous quar-ter.

n The weighted average capitalization rate increased from the previous quarter, while the median capitalization rate decreased.

South


Copyright® 2009 by Real Estate Research Corporation (RERC) and the CCIM Institute.Investment TrendsQuarterly

SouthMarketSnapshot

71

South Region Space MarketOffice - 1Q-2009


Atlanta 136,193 17.8 -562 $19.76 Gross

Austin 38,221 18.6 -55 $18.26 Net

Dallas 151,828 20.1 811 $19.29 Net

Houston 147,312 13.8 -1,077 $19.20 Net

Memphis 24,743 16.0 77 $16.83 Gross

Miami 42,046 15.9 -454 $29.59 Gross

Nashville 30,222 13.0 -106 $18.90 Gross

Orlando 34,630 16.9 -276 $20.69 Gross

San Antonio 23,847 15.8 -367 $19.73 Gross

Tampa 37,367 20.1 -464 $21.87 Gross


Atlanta 590,163 15.8 -5,729 $3.89 Net

Austin 77,057 14.0 -165 $7.88 Net

Dallas 478,685 14.4 -529 $4.58 Net

Houston 460,706 8.6 -1,159 $5.74 Net

Miami 236,211 11.6 -2,137 $8.78 Gross

Nashville 160,927 11.1 -654 $4.01 Net

Orlando 158,893 12.5 -1,265 $6.67 Net

Tampa 169,051 11.6 -2,750 $6.13 Net


Atlanta 84,027 13.7 -587 $23.15

Austin 18,760 10.3 61 $23.39

Dallas 58,943 15.8 -362 $15.98

Houston 62,144 13.4 -45 $21.14

Miami 23,331 5.7 82 $18.12

Nashville 20,837 6.8 79 $18.83

Oklahoma City 18,875 11.7 65 $9.76

Orlando 30,636 8.9 290 $17.76

Tampa 30,772 8.6 -80 $15.37



RERC extends its appreciation to CBRE/Torto Wheaton Research, which contributed all of the space market information on this page.








72



Atlanta MSA 5.5 million Atlanta2 9.1%

Atlanta Growth1 3.21% Georgia2 9.2%





1-year Job Additions -82,000 Median Home Price $129,200

Major Employers

Delta Airlines

Emory University

Bellsouth Corp.

Georgia Pacific Corp.

Hewlett-PackardSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Atlanta Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

780 Canton Road 1-09 $15,300,000 81,102 $189

Cosmopolitan N. Building Park 1-09 $8,320,000 63,132 $132

Industrial

2595 S. Chandler Road 1-09 $5,204,000 46,882 $111

493 Westridge Parkway 2-09 $22,000,000 676,000 $33

Retail

Shenandoah Plaza 2-09 $6,500,000 146,141 $44

105 Long Drive 2-09 $16,050,000 115,396 $139Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Beltline Apartments Multifamily N 325 2010

Peachtree Center Mixed Use R 2,500,000 2012

Trump Tower Multifamily N 563 2010

The Streets of Buckhead Mixed Use N 800,000 2009

Mandarin Oriental Atlanta Hotel N 198 2011Sources: CBRE, RE Business.

Atla

nta Metro Trend Analysis

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73

Atlanta Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)









All TransactionsVolume (Mil) $1,534 $632 $882 $1,533 $52






Atlanta Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% 4% -3% -4% -14%

% Change Year Ago 3% 11% -2% -22% –





74



Austin MSA 1.6 million Austin2 6.2%

Austin Growth1 3.30% Texas2 6.7%





1-year Job Additions 9,600 Median Home Price $184,800

Major Employers

Freescale Semiconductor Incorporated

Dell

Advanced Micro Devices Incorporated

U.S. Internal Revenue Service

FlextronicsSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Austin Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

12885 Research Blvd. 1-09 $5,600,000 50,836 $110

901 MoPac Expressway 2-09 $41,800,000 238,594 $175

Retail

101 W. Koenig Lane 2-09 $2,000,000 14,763 $135

9711 Manchaca Road 3-09 $1,170,000 7,534 $155Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Andaz Hotel N 210 2010

Courtyard by Marriott Hotel N 145 2009

The Offices at East Avenue Office N 215,000 N/A

Northpointe Trade Center Industrial N 500,000 2009Sources: CBRE, RE Business.

Aus

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75

Austin Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $307 – – $442 –

Size Weighted Avg. ($ per sf/unit) $232 – – $86,482 –

Price Weighted Avg. ($ per sf/unit) $251 – – $88,466 –

Median ($ per sf/unit) $213 – – $90,452 –





Capitalization Rates (All Transactions)Weighted Average (%) 6.5 – – – –

Median (%) 6.3 – – – –Source: RERC.

Austin Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% 2% 8% 2% 9%

% Change Year Ago – -3% – 12% 0%

Volume % Change Quarter Ago – 76% -18% -19% -5%

% Change Year Ago -79% -54% – -33% -79%Source: RERC.



76



Dallas/Ft. Worth MSA 6.3 million Dallas/Ft. Worth2 7.0%

Dallas/Ft. Worth Growth1 2.56% Texas2 6.7%




1-year Job Growth Rate 1.40% Household Growth 2.49%


Major Employers

AMR Corp.

Lockheed Martin Corporation

Brinker International Inc.

Texas Instruments Inc.

UT Southwestern Medical CenterSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Dallas Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

The Tower 3-09 $20,000,000 182,000 $110

345 N. Highway 67 3-09 $2,925,000 5,575 $525

Industrial

368 -370 Long Creek Road 2-09 $10,000,000 117,240 $85

12005 Forestgate Drive 1-09 $5,600,000 161,729 $35

Retail

14110 -14370 Marsh Lane 1-09 $13,500,000 173,720 $78

The Shops at Camp Wisdom 2-09 $3,670,000 13,762 $267

Apartment

Prairie Creek 1-09 $46,000,000 464 $99,138

5585 Caruth Haven Lane 2-09 $20,500,000 91 $225,275Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Shamburger Lofts Multifamily N 400 2010

Terraces at Las Colinas Mixed Use N 1,000,000 2011

10740 North Central Expressway Office N 92,000 2009

The Slayton at Museum Way Multifamily N 188 N/ASources: CBRE, RE Business.

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77

Dallas Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)













Capitalization Rates (All Transactions)Weighted Average ($ per sf/unit) 7.8 7.3 7.3 7.5 –

Median ($ per sf/unit) 6.5 7.5 7.3 7.7 –Source: RERC.

Dallas Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -13% -11% -18% -11% 8%





78



Houston MSA 5.8 million Houston2 6.5%

Houston Growth1 2.85% Texas2 6.7%






Major Employers

University of Texas MD Anderson Center

MD Anderson Cancer Center

Schlumberger

Continental Airlines Inc.

Houston City Engineering Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Houston Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

17323 Red Oak Drive 1-09 $3,583,734 15,514 $231

17202 Red Oak Drive 2-09 $6,900,000 85,903 $80

Industrial

6925 & 6955 Portwest Drive 1-09 $5,900,000 70,490 $84

2339 Commerce 1-09 $3,400,000 68,500 $50

Retail

2640 E. League City Parkway 3-09 $8,160,000 27,939 $292

6060 Long Drive 1-09 $1,400,000 13,602 $103

Apartment

Brazos Ranch 1-09 $27,700,000 308 $89,935

2020 Business Center Drive 1-09 $29,300,000 308 $95,130

Hotel

Hampton Inn & Suites 3-09 $7,500,000 74 $101,351Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Corinthian Village Senior Living Multifamily N 124 2010

Discovery Tower Office N 844,763 2010

Washington Centre Retail/Office N 50,000 2009

MainPlace Office N 1,000,000 2010

LKW Best Automotive Warehouse Industrial N 98,850 N/ASources: CBRE, RE Business.

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n Metro Trend AnalysisPrevious Quarter

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79

Houston Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Houston Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -2% -4% -10% -17% –

% Change Year Ago 12% -3% -14% -29% 9%





80



Memphis MSA 1.3 million Memphis2 9.1%

Memphis Growth1 1.23% Tennessee2 9.9%






Major Employers

FedEx

International Paper Co.

Regions Bank

Baptist Memorial Hospital

University of Tennessee at MemphisSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Memphis Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

5904 Ridgeway Center Parkway 1-09 $1,300,000 10,400 $125

Industrial

4747 Getwell Road 3-09 $1,270,000 53,000 $24

Retail

Parkway Plaza Shopping Center 1-09 $6,000,000 28,000 $214

6201 Poplar Ave. 1-09 $1,920,000 6,298 $305

Apartment

Hickory Point Apartments 1-09 $5,780,000 240 $24,083

4030 Summer Ave 3-09 $1,100,000 32 $34,375Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Ridgeway Trace Center Retail N 335,000 2009Sources: CBRE, RE Business.

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81

Memphis Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) – $36 $126 $101 –

Size Weighted Avg. ($ per sf/unit) – $25 $141 $47,190 –

Price Weighted Avg. ($ per sf/unit) – $25 $184 $67,803 –

Median ($ per sf/unit) – $25 $174 $28,138 –







Memphis Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -11% 0% – -15% 0%

% Change Year Ago 14% 5% – -13% -24%

Volume % Change Quarter Ago -3% -47% – -28% 0%




82



Miami MSA 5.6 million Miami2 8.5%

Miami Growth1 1.31% Florida2 9.5%






Major Employers

Jackson Memorial Hospital

Miami Studio Rentals

Baptist Hospital of Miami

University of Miami School of Medicine

Miami-Dade Community CollegeSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Miami Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

2009 Hollywood Blvd. 1-09 $6,482,000 40,640 $159

2495 E. Commercial Blvd. 1-09 $1,200,000 5,700 $211

Industrial

2025 Mckinley St. 1-09 $15,400,000 255,575 $60

5000 N. State Road 7 1-09 $5,400,000 26,425 $204

Retail

250 W. State Road 84 2-09 $1,375,000 7,460 $184

Apartment

157 W. 11th St. 2-09 $1,100,000 12 $91,667

13590 NW 5th Court 1-09 $37,400,000 303 $123,432

Hotel

Holiday Inn Express 2-09 $7,620,000 78 $97,692Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Soho Beach House Hotel N 120 N/A

Sonesta Mikado Hotel N 252 2011

Leon MedicalCenters-Flagler Office N 84,670 2009

Brickell Financial Centre Mixed Use N 586,000 2010Sources: CBRE, RE Business.

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83

Miami Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Miami Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -9% -2% 0% -17% 7%





84



Nashville MSA 1.5 million Nashville2 8.8%

Nashville Growth1 2.06% Tennessee2 9.9%




1-year Job Growth – Household Growth 2.12%

1-year Job Additions – Median Home Price –

Major Employers

Vanderbilt University Medical Center

Saint Thomas Hospital

Gaylord Opryland

Baptist Hospital

Saturn CorporationSources: Bureau of Labor Statistics, NAR, STDB Online.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

2404 Crestmoor Road 3-09 $1,930,000 7,996 $241

Industrial

3258 Ezell Pike 2-09 $3,780,000 151,000 $25

2926 Kraft Drive 2-09 $2,100,000 67,132 $31

Hotel

100 Barzandi Drive 3-09 $5,950,000 65 $91,538

1414 Princeton Place 1-09 $2,651,000 65 $40,785Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Pinnacle at Symphony Place Office N 520,000 2010

Nordstrom Retail N 149,000 2010

Gaylord Opryland Resort Mixed Use R 1,000,000 2010

Beckwith Farms Industrial Industrial N 827,500 N/ASources: CBRE, RE Business.

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85

Nashville Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Nashville Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -7% 0% 1% -2% 0%

% Change Year Ago 4% -21% - -21% -52%

Volume % Change Quarter Ago 8% 8% 0% -34% 21%




86



NO/BR MSA 784,441/1.2 mil NO/BR2 5.3%

NO/BR Growth1 1.37/1.61% Louisiana2 5.7%




1-year Job Growth 1.1% - 1.3% Household Growth 1.51/1.67%

1-year Job Additions 4,000 - 6,600 Median Home Price $154,900

Major Employers

Louisiana State University Medical Center

Charity Hospital of Louisiana

Harrah’s New Orleans Casino

Tulane University

JCC Holding Co. II LLCSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - New Orleans-Baton Rouge Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

2650 Canal St. 2-09 $1,325,000 22,800 $58

Industrial

4920 Tchoupitoulas 3-09 $745,000 7,262 $103Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Louisiana Cancer Research Center Office N 250,000 2011

C.J. Peete Housing Property Redevelopment Mixed Use R 550,000 2011Sources: CBRE, RE Business.

New

Orle

ans

/Ba

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e Metro Trend AnalysisPrevious Quarter

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Office


Retail


Source: RERC, 1Q 2009.



87

New Orleans Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $5 MillionVolume (Mil) $11 – $6 $7 –




> $5 MillionVolume (Mil) – – – – –

Size Weighted Avg. ($ per sf/unit) – – – – –

Price Weighted Avg. ($ per sf/unit) – – – – –

Median ($ per sf/unit) – – – – –

All TransactionsVolume (Mil) $139 – $32 $7 –




Capitalization Rates (All Transactions)Weighted Average (%) – – – – –

Median (%) – – – – –Source: RERC.

New Orleans Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -25% – 0% – –

% Change Year Ago -35% – -51% – –

Volume % Change Quarter Ago -14% – 0% – –

% Change Year Ago -17% – -65% – –Source: RERC.



88



Oklahoma City MSA 1.2 million Oklahoma City2 5.6%

Oklahoma City Growth1 1.34% Oklahoma2 6.1%






Major Employers

Baptist Medical Center

Tinker Air Force Base

UPS

Express Travel Service Inc.

FAA Aeronautical CenterSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Oklahoma City Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2008. 3Rates are non-seasonally adjusted as of April 2009.



Office

5700 N. Portland Ave. 2-09 $2,370,000 36,179 $66

2149 SW 59th St. 1-09 $1,950,000 25,435 $77

Industrial

6800 N. BroadwayExtension Highway 1-09 $995,000 11,400 $87

Retail

610 S. Kelly Ave. 1-09 $3,350,000 43,769 $77

Apartment

The Sycamore Farms 1-09 $20,700,000 398 $52,010

Lakewood Park 3-09 $5,300,000 209 $25,359Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Devon Energy Corp. Office N 1,900,000 2012

AAA Operations Center Office N 147000 2009Sources: CBRE, RE Business.

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89

Oklahoma City Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $101 – – $180 –

Size Weighted Avg. ($ per sf/unit) $125 – – $66,898 –

Price Weighted Avg. ($ per sf/unit) $138 – – $78,413 –

Median ($ per sf/unit) $137 – – $64,912 –





Capitalization Rates (All Transactions)Weighted Average (%) 7.1 – – 7.4 –

Median (%) 6.3 – – 7.5 –Source: RERC.

Oklahoma City Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 7% 0% 6% -2% –

% Change Year Ago 9% 8% – 12% –

Volume % Change Quarter Ago 7% -27% -25% -31% –




90



Orlando MSA 2.1 million Orlando2 9.9%

Orlando Growth1 3.12% Florida2 9.5%






Major Employers

Universal Orlando

Central Florida Investments

Orlando Regional Healthcare

Lockheed Martin Corporation

SunTrust Banks Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Orlando Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

Realnet Headquarters 1-09 $5,600,000 24,700 $227

Central FloridaEye 1, 2, & 3 1-09 $12,700,000 46,323 $274

Industrial

CrownPointe 5 & 6 2-09 $17,195,000 250,499 $69

350 Anchor Road 1-09 $3,600,000 110,240 $33

Retail

Regency Village 1-09 $13,800,000 83,167 $166

Metrowest Shoppes 1-09 $12,000,000 32,908 $365

Hotel

4694 Highway 192 1-09 $1,908,000 131 $14,565Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Staghorn Villas Multifamily N 58 2011

Commerce Center Phase I Industrial N 57,000 N/A

Montage Multifamily N 183 2010

777 N. Orange Ave. Office N 160,000 2011

Nemours Children’s Hospital Office N 620,000 2012Sources: CBRE, RE Business.

Orla

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Orlando Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $5 MillionVolume (Mil) $55 $81 $85 – –












Capitalization Rates (All Transactions)Weighted Average (%) 8.0 – 7.3 – –

Median (%) 8.0 – 7.0 – –Source: RERC.

Orlando Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 5% -6% 0% -7% -32%

% Change Year Ago -2% 4% – -16% -44%

Volume % Change Quarter Ago -38% -13% 17% -28% -17%




92



San Antonio MSA 2.1 million San Antonio2 5.9%

San Antonio Growth1 2.33% Texas2 6.7%






Major Employers

USAA

University of Texas Health Science

West Telemarketing

University Health System

University of Texas at San AntonioSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Corpus Christi Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

5706 Northwest Loop 410 2-09 $2,000,000 5,666 $353

8626 Tesoro Drive 1-09 $22,000,000 234,288 $94

Retail

852 W. Rhapsody Drive 1-09 $1,688,000 8,700 $194

13722 Embassy Row 2-09 $2,125,000 25,260 $84

Apartment

Stratford 1-09 $12,256,000 160 $76,600

Countryside 1-09 $7,613,000 220 $34,605Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Rialto Village Mixed Use N

185,000 retail

200941,000 office

Tesoro Corp. Office Office N 618,000 N/ASources: CBRE, RE Business.

San

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oni

o Metro Trend AnalysisPrevious Quarter

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93

San Antonio Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) – – $112 $111 –

Size Weighted Avg. ($ per sf/unit) – – $222 $52,307 –

Price Weighted Avg. ($ per sf/unit) – – $270 $75,996 –

Median ($ per sf/unit) – – $252 $42,994 –







San Antonio Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 10% -3% -4% – –

% Change Year Ago -7% 8% -16% 28% –

Volume % Change Quarter Ago 9% -13% -21% – –




94



Tampa MSA 2.8 million Tampa2 10.4%

Tampa Growth1 2.04% Florida2 9.5%



Per Capita Income $27,959 2008 Households 1,170,535



Major Employers

Verizon Communications

Tampa International Airport

Tampa General Hospital

University of South Florida

Hillsborough County GovernmentSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Tampa Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

500 N. Westshore Blvd. 2-09 $21,100,000 127,872 $165

Harbourside 2-09 $13,600,000 153,000 $89

Industrial

4705 W. Cayuga St. 1-09 $5,700,000 83,929 $68

Retail

Belleair Bazaar 3-09 $6,500,000 38,569 $169

Apartment

9615 Gulf Blvd. 2-09 $1,210,000 24 $50,417

500 Belcher Road S. 1-09 $11,800,000 143 $82,517

Hotel

451 34th St. N. 1-09 $1,330,000 50 $26,600Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Premier Beverage Company of Florida Industrial N 580,000 N/A

Met West Building 1 Office N 250,000 N/A

Hotel Indigo Hotel N 168 2010

Park Centre Office N 88,000 N/ASources: CBRE, RE Business.

Tam

pa Metro Trend Analysis

Previous Quarter

Previous Year

Office



Industrial



Retail



Apartment



Hotel



Office

vs. South Region

vs. Nation

Industrial

vs. South Region

vs. Nation

Retail

vs. South Region

vs. Nation

Apartment

vs. South Region

vs. Nation

Hotel

vs. South Region

vs. Nation




95

Tampa Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Tampa Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -11% -4% -25% -8% -41%

Volume % Change Quarter Ago -10% -19% 12% -21% 15%



Chicago • Cincinnati • Cleveland • Columbus • Detroit • Indianapolis Kansas City • Milwaukee • Minneapolis • Omaha • St. Louis • Toledo

Midwest Region



MidwestRegionTransactionBreakdown

Midwest Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)









> $5 MillionVolume (Mil) $4,841 $2,068 $1,989 $2,524 $521




All TransactionsVolume (Mil) $5,510 $3,341 $3,459 $3,125 $617





Weighted Avg. (%) 8.1 8.1 7.8 7.1 –


n CCIM members rated the Midwest region’s economic con-ditions at 4.4 on a scale of 1 to 10, with 10 being high, during first quarter 2009. This rating was up from last quar-ter’s rating of 3.1, and was tied this quarter with the East region for the highest among the four regions.

n Most of the survey respondents were fairly evenly split as to whether the Midwest region’s economy will remain the

same over the coming year or get better. About 25 percent of respondents believe the economy will perform worse during the coming year.

n The Midwest region continued to see declining transaction volume during first quarter 2009, while price averages also declined.




MidwestRegionTransactionBreakdown

Midwest Transaction BreakdownCurrent Quarter Rates (01/01/09 - 03/31/09)

















Capitalization Rates (All Transactions)Range (%) 4.6 - 8.5 – 6.6 - 11.8 5.6 - 8.8 –

Weighted Avg. (%) 7.8 – 8.3 7.4 –


Cleveland –“Due to the credit crunch, leasing has picked up considerably vs. purchasing.”

St. Louis –“Most owners are holding unless they have no choice, and the purchasers in our marketplace are being very cautious about what they acquire.”

Chicago –“We’re seeing buyers looking for fully-leased or substantially-leased retail, and/or industrial in the collar counties.”





$0

$100

$200

$300

$400

$500

$0

$100

$200

$300

$400

$500

Midwest

U.S. TotalPrice-Weighted Average PPSF

Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


2%

4%

6%

8%

10%

2%

4%

6%

8%

10%MidwestU.S. TotalAvg. Capitalization Rate

Detroit

Columbu

s

Chicag

o


Midwest Office Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Chicago $1,642 $165 $200 $125 8.0

Cincinnati $107 $104 $124 $80 –

Cleveland $519 $110 $129 $85 –

Columbus $137 $89 $108 $102 7.2

Detroit $697 $111 $116 $115 8.7

Indianapolis $134 $123 $152 $117 –

Kansas City $242 $107 $146 $83 –

Milwaukee $174 $124 $140 $83 –

Minneapolis $269 $93 $151 $93 –

Omaha $17 $80 $109 $65 –

St. Louis $302 $132 $157 $102 –

Toledo $26 $108 $137 $114 –

Midwest Total $5,510 $130 $176 $94 8.1


$0

$50

$100

$150

$200

$250

$0

$50

$100

$150

$200

$250

Midwest

U.S. TotalSize-Weighted Average PPSF

Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


n Office transaction volume in the Midwest region continued to decrease during first quarter 2009, posting a decline of approximately 20 percent on a 12-month trailing basis. The price per square foot decreased from the previous quarter.

n The 12-month trailing weighted average and median capi-talization rates increased to 8.1 percent and 7.9 percent, respectively.

Midwest





$0

$20

$40

$60

$80

$100

$120

$0

$20

$40

$60

$80

$100

$120

MidwestU.S. TotalPrice-Weighted Average PPSF

Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


Midwest Industrial Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Chicago $1,153 $48 $66 $62 7.8

Cincinnati $52 $37 $42 $42 –

Cleveland $164 $39 $49 $39 –

Columbus $207 $40 $47 $43 –

Detroit $115 $37 $66 $43 10.8

Indianapolis $243 $45 $46 $46 –

Kansas City $119 $40 $50 $45 –

Milwaukee $111 $54 $67 $54 –

Minneapolis $313 $59 $99 $56 –

Omaha $61 $41 $51 $43 –

St. Louis $215 $48 $81 $47 –

Toledo $25 $45 $63 $30 –

Midwest Total $3,341 $42 $65 $44 8.1


$0

$25

$50

$75

$100

$0

$25

$50

$75

$100MidwestU.S. TotalSize-Weighted Average PPSF

Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


n Transaction volume in the Midwest industrial market de-clined 25 percent during first quarter 2009.

n Price per square foot of industrial space in the Midwest region decreased from the previous quarter. However, the weighted average capitalization rate and the median capitalization rate declined to 8.1 percent and 8.0 percent, respectively.

Midwest

2%

4%

6%

8%

10%

12%

2%

4%

6%

8%

10%


Detroit

Chicag

o






$0

$50

$100

$150

$200

$250

$300

$0

$50

$100

$150

$200

$250

$300MidwestU.S. TotalPrice-Weighted Average PPSF

Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


2%

4%

6%

8%

10%

12%

2%

4%

6%

8%

10%


Minnea

polis

Milwau

kee

Kansa

s City

Detroit

Columbu

s

Clevela

nd

Chicag

o


Midwest Retail Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Chicago $918 $176 $263 $165 7.3

Cincinnati $200 $76 $166 $81 –

Cleveland $137 $67 $89 $72 8.1

Columbus $127 $144 $216 $127 7.4

Detroit $120 $76 $138 $107 9.2

Indianapolis $71 $101 $148 $188 –

Kansas City $296 $73 $197 $65 7.4

Milwaukee $91 $111 $184 $73 7.5

Minneapolis $256 $116 $159 $109 7.3

Omaha $104 $89 $136 $75 –

St. Louis $136 $121 $211 $98 –

Toledo $30 $101 $198 $66 –

Midwest Total $3,459 $100 $198 $88 7.8


$0

$50

$100

$150

$200

$0

$50

$100

$150

$200MidwestU.S. TotalSize-Weighted Average PPSF

Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


n During first quarter 2009, the transaction volume of retail properties in the Midwest region further declined. The av-erage and median prices of retail properties decreased.

n The weighted average and median capitalization rates for the Midwest regional retail sector increased to 7.8 percent and 7.5 percent, respectively.

Midwest





$0

$50,000

$100,000

$150,000

$200,000

$0

$50,000

$100,000

$150,000

$200,000

MidwestU.S. Total


Toled

o

St. Lou

is

Omaha

Minnea

polis

Milwau

kee

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


2%

4%

6%

8%

10%

2%

4%

6%

8%


Toled

o

St. Lou

is

Omaha

Minnea

polis

Kansa

s City

Indian

apoli

s

Detroit

Columbu

s

Clevela

nd

Chicag

o


Midwest Apartment Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Chicago $668 $100,584 $170,348 $72,619 6.6

Cincinnati $102 $50,566 $60,372 $35,339 –

Cleveland $134 $44,702 $56,382 $43,056 7.6

Columbus $156 $46,602 $55,011 $33,712 6.8

Detroit $137 $50,002 $66,062 $38,099 8.0

Indianapolis $200 $42,628 $47,189 $42,840 8.0

Kansas City $154 $64,217 $82,506 $34,083 7.2

Milwaukee $84 $80,543 $134,135 $52,340 –

Minneapolis $386 $71,374 $88,018 $62,228 6.5

Omaha $113 $58,958 $71,569 $40,741 7.1

St. Louis $182 $49,614 $61,278 $48,765 7.6

Toledo $63 $54,285 $72,185 $67,875 7.6

Midwest Total $3,125 $59,002 $95,455 $43,432 7.1


$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000Midwest

U.S. Total


Toled

o

St. Lou

is

Omaha

Minnea

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Milwau

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Kansa

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Indian

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s

Detroit

Columbu

s

Clevela

nd

Cincinn

ati

Chicag

o


n On a 12-month trailing average basis, sales volume for Midwest regional apartment properties declined by more than one-third during first quarter 2009.

n The capitalization rates for the Midwest apartment mar-ket increased during first quarter 2009 as compared to the previous quarter. The average and median price per apart-ment unit decreased.

Midwest




HotelPropertySector

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

Midwest


St. Lo

uis

Minnea

polis

Kans

as Ci

ty

Chica

go


Midwest Hotel Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Chicago $160 $112,461 $245,067 $68,966 –

Cincinnati – – – – –

Cleveland – – – – –

Columbus – – – – –

Detroit – – – – –

Indianapolis – – – – –

Kansas City $123 $107,610 $138,547 $88,436 –

Milwaukee – – – – –

Minneapolis $30 $45,625 $48,802 $51,577 –

Omaha – – – – –

St. Louis $123 $62,320 $78,057 $28,521 –

Toledo – – – – –

Midwest Total $617 $65,773 $128,963 $41,961 –


$0

$30,000

$60,000

$90,000

$120,000

$150,000

$0

$30,000

$60,000

$90,000

$120,000

$150,000

MidwestU.S. TotalSize-Weighted Average PPU

St. Lou

is

Minnea

polis

Kansa

s City

Chicag

o


n Transaction activity in the Midwest hotel market has slowed so much that it has almost come to a standstill. First quar-ter 2009 transaction volume declined by almost 55 percent as compared to the previous quarter, on a 12-month trail-ing basis.

n The first quarter price per hotel unit decreased from the previous quarter.

Midwest



MidwestMarketSnapshot

104

Midwest Region Space MarketOffice - 1Q-2009


Chicago 222,825 16.4 -1,379 $18.36 Net

Cincinnati 35,766 16.7 245 $15.38 Gross

Cleveland 37,386 15.6 -290 $16.66 Gross

Columbus 28,492 15.3 147 $11.09 Net

Detroit 71,712 22.8 -376 $19.01 Gross

Indianapolis 31,414 16.6 -268 $17.25 Gross

Kansas City 48,520 14.4 45 $17.95 Gross

Minneapolis 63,278 16.2 -472 $13.73 Net

St. Louis 43,227 14.3 -51 $18.78 Gross

Toledo 13,277 18.3 -129 $15.03 Gross


Chicago 1,080,049 13.6 -8,136 $5.12 Net

Cincinnati 291,195 10.7 -448 $3.93 Net

Cleveland 312,812 10.2 -1,226 $4.33 Net

Columbus 247,572 16.0 -305 $3.33 Net

Detroit 495,091 19.3 -5,367 $4.95 Net

Indianapolis 270,360 10.6 856 $4.69 Gross

Kansas City 238,331 8.9 -2,123 $4.21 Gross

Minneapolis 321,508 10.0 -2,943 $6.31 Net

St. Louis 273,814 11.9 -573 $4.24 Net


Chicago 95,694 12.7 -29 $21.85

Cincinnati 21,493 13.4 43 $12.48

Cleveland 14,687 14.4 -74 $20.31

Columbus 18,406 16.9 312 $13.96

Detroit 31,891 17.6 159 $20.49

Indianapolis 20,852 15.0 -53 $20.11

Kansas City 27,733 13.7 23 $19.50

Minneapolis 27,361 8.1 -180 $20.99

St. Louis 33,681 12.8 -68 $24.07



RERC extends its appreciation to CBRE/Torto Wheaton Research, whichcontributed all of the space market information on this page.








105



Chicago MSA 9.8 million Chicago2 9.4%

Chicago Growth1 0.98% Illinois2 9.4%






Major Employers

Johnston R. Bowman Health Center

U.S. Post Office

University of Chicago

Deloitte

CNA Financial Corp.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Chicago Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

2 Lincoln Center 1-09 $60,200,000 252,594 $238

FBI Regional HQ 1-09 $170,000,000 429,728 $396

Industrial

7351 S. 78th Ave. 1-09 $14,000,000 137,700 $102

948 Meridian Lake Drive 1-09 $23,400,000 595,000 $39

Retail

1925 N. Lincoln Park W 2-09 $1,600,000 13,500 $119

606 Randall Road 1-09 $20,100,000 138,212 $145

Apartment

Squire Village Apartments 2-09 $16,100,000 181 $88,950

Farcroft 1-09 $8,100,000 86 $94,186Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

215 W. Washington St. Multifamily N 389 2010

208 S. LaSalle Hotel R 610 2010

Preferred Freezer Services Warehouse Industrial N 175,000 2010

Park Huron Apartment Tower Multifamily N 221 2010

The Metropolis Retail N 123,000 2010Sources: CBRE, RE Business.

Chi

ca

go Metro Trend Analysis

Previous Quarter

Previous Year

Office



Industrial



Retail



Apartment



Hotel



Office

vs. Midwest Region =

vs. Nation

Industrial

vs. Midwest Region

vs. Nation

Retail

vs. Midwest Region

vs. Nation

Apartment

vs. Midwest Region

vs. Nation




106

Chicago Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)









All TransactionsVolume (Mil) $1,642 $1,153 $918 $668 $160






Chicago Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -6% -3% -6% -5% -24%

% Change Year Ago -17% -1% 1% 2% -36%





107



Cincinnati MSA 2.1 million Cincinnati2 9.0%

Cincinnati Growth1 0.87% Ohio2 10.1%






Major Employers

Procter & Gamble Co.

University of Cincinnati

Fifth Third Bancorp

Kroger Co.

Cincinnati Children’s Hospital Medical CenterSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Cincinnati Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

10560 Ashview Place 3-09 $16,750,000 120,853 $139

Industrial

200 Olympic Drive 3-09 $1,370,000 32,000 $43

2950 Robertson Ave. 3-09 $4,300,000 66,520 $65

Retail

7788 Montgomery Road 2-09 $5,150,000 22,709 $227

Apartment

2 Chateau Place 1-09 $3,425,000 96 $35,677Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Uptown Commons Phase 1 Mixed Use N

50,000 retail 150

mult. 2010

Kenwood Towne Place Office N 270,000 2009

Queen City Square Tower Office N 825,000 2011

The Banks Mixed Use N 1,400,000 2010Sources: CBRE, RE Business.

Cin

cin

nati Metro Trend Analysis

Previous Quarter

Previous Year

Office


Industrial


Retail


Apartment





108

Cincinnati Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Cincinnati Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -8% 0% – -3% –

% Change Year Ago -6% -6% -23% – –

Volume % Change Quarter Ago 4% -50% – -50% –

% Change Year Ago -12% -87% -12% – –Source: RERC.



109



Cleveland MSA 2.1 million Cleveland2 8.7%

Cleveland Growth1 -0.08% Ohio2 10.1%






Major Employers

Cleveland Clinic Foundation

University Hospital of Cleveland

National City Corp.

Key Corp.

Parker Hannifin Corp.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Cleveland Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Industrial

4437 E. 49th St. 3-09 $6,600,000 231,505 $29

1260 Ethan Ave. 2-09 $1,200,000 23,600 $51

Retail

Snowville Plaza 3-09 $2,100,000 63,120 $33

152-176 Cherry St. 1-09 $1,950,000 128,028 $15

Apartment

18675 Van Aken Blvd. 1-09 $1,350,000 37 $36,486

262 Mulberry St. 3-09 $2,850,000 180 $15,833Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Hotel Indigo Hotel N N/A 2010

The Flats Mixed Use N N/A 2010Sources: CBRE, RE Business.

Cle

vela

ndMetro Trend Analysis

Previous Quarter

Previous Year

Office


Industrial


Retail

Size-Weighted Average PPSF –


Apartment




Retail

vs. Midwest Region

vs. Nation

Apartment

vs. Midwest Region

vs. Nation




110

Cleveland Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Cleveland Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago 1% -6% -11% 12% –





111



Columbus MSA 1.8 million Columbus2 8.1%

Columbus Growth1 1.16% Ohio2 10.1%






Major Employers

Ohio State University

State of Ohio Department of Corrections

Nationwide Mutual Insurance Co.

Mount Carmel Health System

American Electric Power Co, Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Columbus Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

2 Metro Place 1-09 $16,000,000 118,000 $136

1111 Schrock Road 2-09 $6,000,000 97,714 $61

Industrial

6460 E. Broad St. 1-09 $7,382,000 66,500 $111

4735 Evanswood Drive 1-09 $5,600,000 50,060 $112

Retail

6748 E. Main St. 2-09 $1,455,600 11,501 $127

4108-4120 Buckeye Parkway 3-09 $3,500,000 10,325 $339

Apartment

Lake Eden Apartments 2-09 $8,000,000 387 $20,672

1800 N. Star Road 2-09 $3,419,000 36 $94,972Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Kellogg Distribution Facility Industrial N 1,100,000 2008

Embassy Suites Hotel N 185 2009

Franklin County Courthouse Office N 325,000 2010Sources: CBRE, RE Business.

Co

lum

bus Metro Trend Analysis

Previous Quarter

Previous Year

Office



Industrial


Retail


Weighted Average Cap Rate = –

Apartment


Weighted Average Cap Rate – =


Office

vs. Midwest Region

vs. Nation

Retail

vs. Midwest Region

vs. Nation

Apartment

vs. Midwest Region

vs. Nation




112

Columbus Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Columbus Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -3% -2% 3% -47% –

% Change Year Ago -8% 5% – -18% –





113



Detroit MSA 4.6 million Detroit2 14.0%

Detroit Growth1 0.24% Michigan2 13.4%




1-year Job Growth – Household Growth 0.33%

1-year Job Additions – Median Home Price –

Major Employers

Rehabilitation Institute of Michigan

Blue Cross Blue Shield of Michigan

Henry Ford Health System

City of Detroit

DTE EnergySources: Bureau of Labor Statistics, NAR, STDB Online.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Industrial

22475 Venture Drive 3-09 $2,069,000 64,674 $32

34300 W. Nine Mile Road 1-09 $3,000,000 110,000 $27

Retail

59020 Gratiot Ave. 3-09 $3,810,000 14,564 $262

29500 23 Mile Road 2-09 $1,690,000 13,446 $126

Apartment

12830 Lahser 2-09 $440,000 44 $10,000Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Etkin Equities Office Bldg. Office N 60,000 2009Sources: CBRE, RE Business.

De

tro

it Metro Trend AnalysisPrevious Quarter

Previous Year

Office



Industrial



Retail



Apartment




Office

vs. Midwest Region

vs. Nation

Industrial

vs. Midwest Region

vs. Nation

Retail

vs. Midwest Region

vs. Nation

Apartment

vs. Midwest Region

vs. Nation




114

Detroit Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Detroit Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% -12% – -17% –

% Change Year Ago 9% -16% -4% -11% –

Volume % Change Quarter Ago -4% -12% – -53% –

% Change Year Ago 13% -78% -65% -70% –Source: RERC.



115



Indianapolis MSA 1.7 million Indianapolis2 8.7%

Indianapolis Growth1 1.67% Indiana2 10.6%






Major Employers

Eli Lilly & Co.

Peyton Manning’s Childrens Hospital

Roche Diagnostics Corporation

Allison Transmission Inc.

Rolls-Royce Corp.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Indianapolis Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Retail

Noblesville Square 3-09 $8,500,000 135,000 $63

102 Lee Blvd. 3-09 $1,500,000 5,514 $272

Apartment

Creekwood Apartments 3-09 $15,000,000 518 $28,958

1504 Renton Ave. 3-09 $5,300,000 170 $31,176Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

JW MarriottIndianapolis Hotel N 1,005 2011

Concourse at Crosspoint Office N 116,000 N/A

INTECH Four Office N 150,000 2009

Franklin Tech Park BTS Industrial N 809,000 2009Sources: CBRE, RE Business.

Ind

iana

po

lis Metro Trend AnalysisPrevious Quarter

Previous Year

Office


Industrial


Retail


Apartment




Apartment

vs. Midwest Region

vs. Nation




116

Indianapolis Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Indianapolis Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 4% 0% -7% 0% –

% Change Year Ago – – – -40% –

Volume % Change Quarter Ago -2% -8% -12% 6% –

% Change Year Ago – – – -35% –Source: RERC.



117



Kansas City MSA 2 million Kansas City2 8.2%

Kansas City Growth1 1.26% Missouri2 9.1%






Major Employers

Hallmark Cards Inc.

Kansas City City Hall

U.S. Health & Human Services Department

University of Missouri-Kansas (UMKC)

DST TechnologiesSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Kansas City Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

5949 Nieman Road 1-09 $585,000 7,506 $78

1732 Oak St. 2-09 $1,510,000 25,525 $59

Industrial

10605 W. 84th Terrace 2-09 $2,050,000 33,360 $61

6101 NE Parretta Drive 3-09 $3,200,000 100,000 $32

Retail

Great Mall of the Great Plains 1-09 $20,500,000 844,511 $24

Apartment

Chatham Apartments 2-09 $1,190,000 88 $13,523

1409 W. Maple 3-09 $1,090,000 40 $27,250Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Corporate Centre I Office N 205,934 N/A

Intermodal Business Center Mixed Use N 1,800,000 2009

Two Hallbrook Place Office N 115,252 N/ASources: CBRE, RE Business.

Kans

as


Previous Quarter

Previous Year

Office


Industrial


Retail


Apartment



Hotel



Retail

vs. Midwest Region

vs. Nation

Apartment


vs. Nation




118

Kansas City Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Kansas City Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -28% -1% -14% 0% -4%

% Change Year Ago -31% -15% -32% -10% 4%





119



Milwaukee MSA 1.5 million Milwaukee2 9.0%

Milwaukee Growth1 0.22% Wisconsin2 9.4%






Major Employers

Wheaton Franciscan Healthcare

University of Wisconsin

Marshall & Ilsley

Northern Chocolate Co.

Northwestern Mutual InvestmentSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Milwaukee Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

7878 N. 76th St. 2-09 $7,100,000 41,483 $171

250 Bishops Way 1-09 $6,500,000 33,162 $196

Industrial

12121 W. Feerick St. 3-09 $2,400,000 65,240 $37

2030 S. 116th St. 1-09 $3,450,000 47,719 $72

Retail

2700 N. Grandview Blvd. 2-09 $5,500,000 14,650 $375

3350 S. 108th St. 2-09 $1,500,000 51,977 $29

Apartment

3800-3840 S. 84th St. 2-09 $2,150,000 40 $53,750Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Pabst Farms Town Centre Retail N 1,000,000 2010

Aloft Hotel Hotel N 160 2009

Wal-Mart Supercenter Retail N 156,000 2010Sources: CBRE, RE Business.

Milw

auk

ee Metro Trend Analysis

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Previous Year

Office


Industrial


Retail



Apartment



Retail

vs. Midwest Region

vs. Nation




120

Milwaukee Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $139 $48 $47 – –








Capitalization Rates (All Transactions)Weighted Average (%) – – 7.5 – –

Median (%) – – 7.3 – –Source: RERC.

Milwaukee Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -5% 15% -12% 0% –

Volume % Change Quarter Ago 4% -7% -13% 18% –




121



Minneapolis MSA 3.3 million Minneapolis2 8.4%

Minneapolis Growth1 1.34% Minnesota2 8.9%






Major Employers

University of Minnesota

Fairview University Medical Center

Target Corp.

Ameriprise Financial

Prudential Insurance Co.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Minneapolis Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

9300 Excelsior Blvd. 1-09 $52,250,000 268,000 $195

12301 Whitewater Drive 1-09 $9,620,000 66,000 $146

Industrial

Excelsior Crossing Phase 2 3-09 $64,500,000 268,000 $241

101 W. 82nd St. 2-09 $8,550,000 230,000 $37

Retail

8100 Old Carriage Court 1-09 $7,700,000 30,000 $257

2828 University Ave. SE 1-09 $1,725,000 32,409 $53

Apartment

East Campus Apartments 1-09 $3,420,000 60 $57,000Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Manning Ave. Project Mixed Use N 25,264,486 2030

Crest RidgeCorporate Center Office N 110,000 2009

Excelsior Crossings in Hopkins Office N 450,000 2013

West EndDevelopment inSt. Louis Park Retail N 350,000 2009Sources: CBRE, RE Business.

Min

nea

po

lis Metro Trend AnalysisPrevious Quarter

Previous Year

Office


Industrial


Retail



Apartment



Hotel



Retail

vs. Midwest Region

vs. Nation

Apartment

vs. Midwest Region

vs. Nation




122

Minneapolis Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Minneapolis Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -26% 0% 2% 0% -1%

% Change Year Ago -27% -4% – -5% -18%


% Change Year Ago -87% -42% – 7% -85%Source: RERC.



123



Omaha MSA 851,300 Omaha2 5.1%

Omaha Growth1 1.28% Nebraska2 4.9%





1-year Job Additions 600 Median Home Price $129,700

Major Employers

University of Nebraska Medical Center (UNMC)

1st National of Nebraska

Mutual of Omaha Insurance Co.

Con Agra Foods Inc.

Union Pacific Railroad Co.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Omaha Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

11704 West Center Road 2-09 $5,005,000 25,914 $193

Industrial

2720 N. 84th St. 1-09 $2,210,000 87,138 $25

2920 N. 118th St. 3-09 $2,100,000 19,342 $109

Retail

3025 Farnam St. 2-09 $1,300,000 9,118 $143

13750 Millard Ave. 2-09 $1,400,000 17,298 $81Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Midtown Crossing at Turner Park Mixed Use N 1,000,000 2009

Mutual of Omaha - Southport Office N 33,000 N/A

California Plaza Office N 60,000 2009Sources: CBRE, RE Business.

Om

aha


Previous Year

Office


Industrial


Retail


Apartment



Apartment


vs. Nation




124

Omaha Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) – $35 – $107 –

Size Weighted Avg. ($ per sf/unit) – $51 – $61,627 –

Price Weighted Avg. ($ per sf/unit) – $58 – $73,526 –

Median ($ per sf/unit) – $70 – $45,382 –







Omaha Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -23% -12% -33% -11% –

Volume % Change Quarter Ago -41% 16% -17% 10% –

% Change Year Ago -91% -4% 60% -43% –Source: RERC.



125



St. Louis MSA 2.9 million St. Louis2 9.4%

St. Louis Growth1 0.74% Missouri2 9.1%






Major Employers

BJC HealthCare

Washington University (St. Louis)

Anheuser-Busch Co. Inc.

ABM Industries

A G Edwards & Sons Inc.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - St. Louis Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

689 Craig Road 2-09 $1,920,000 19,810 $97

1 Country Club View 1-09 $1,500,000 11,250 $133

Industrial

720 W. McAllister St. 1-09 $3,607,000 74,524 $48

9727 Green ParkIndustrial Drive 2-09 $4,000,000 47,736 $84

Retail

1190 CollinsvilleCrossing Blvd. 2-09 $4,600,000 14,820 $310

1153-1191 Bryan Road 1-09 $1,700,000 12,000 $142

Apartment

5386 - 5390 Pershing Ave. 2-09 $2,165,000 40 $54,125

7000 Brandon Ave. 3-09 $325,000 26 $12,500

Hotel

800 Washington Ave. 1-09 $98,000,000 1,083 $90,489Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Lemp Brewery Complex Mixed Use R

75,000 sf & 400 units 2012

Air Product’s Phase 1 Industrial N 98,047 N/A

Pointe Fenton II Industrial N 60,000 N/A

BRDG Park Office N 118,000 N/ASources: CBRE, RE Business.

St. L

oui

sMetro Trend Analysis

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Previous Year

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Industrial


Retail


Apartment


Hotel



Apartment

vs. Midwest Region

vs. Nation




126

St. Louis Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















St. Louis Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -20% -6% -9% 0% 9%

% Change Year Ago -17% -13% -12% – -60%

Volume % Change Quarter Ago -34% -21% -32% -9% 34%

% Change Year Ago -79% -56% -86% – -59%Source: RERC.



127



Toledo MSA 666,135 Toledo2 12.1%

Toledo Growth1 0.08% Ohio2 10.1%






Major Employers

ProMedica Health System

Bowling Green University

St. Vincent Mercy Medical

Manor Care, Inc.

University of ToledoSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Toledo Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Industrial

6700 Wales Road 3-09 $2,400,000 87,317 $27Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.

Tole

do Metro Trend Analysis

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Previous Year

Office


Industrial


Retail


Apartment



Apartment

vs. Midwest Region

vs. Nation




128

Toledo Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)


Size Weighted Avg. $108 $31 $101 $20,876 –

Price Weighted Avg. $137 $33 $187 $83,049 –

Median $114 $30 $64 $30,333 –

> $5 MillionVolume (Mil) – – – $59 –

Size Weighted Avg. – – – $59,954 –

Price Weighted Avg. – – – $71,543 –

Median – – – $69,188 –




Median $114 $30 $66 $67,875 –

Capitalization Rates (All Transactions)Weighted Average – – – 7.6 –

Median – – – 7.4 –Source: RERC.

Toledo Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago – -8% 11% 4% –

% Change Year Ago – -5% -19% – –

Volume % Change Quarter Ago – 9% 32% -46% –

% Change Year Ago – 91% 28% – –Source: RERC.


Denver • Honolulu • Las Vegas • Los Angeles • Phoenix • Portland • SacramentoSalt Lake City • San Diego • San Francisco • Seattle • Tucson

West Region



WestRegionTransactionBreakdown

West Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment Hotel< $2 MillionVolume (Mil) $556 $1,091 $849 $773 $25




$2 - $5 MillionVolume (Mil) $1,260 $1,790 $1,700 $1,631 $153













Weighted Avg. (%) 6.3 6.9 6.3 5.7 6.8


n CCIM members who responded to RERC’s survey rated the West region’s economy at 4.3 on a scale of 1 to 10, with 10 being high, during first quarter 2009. This rating was an increase from the previous quarter’s rating of 3.9. About 40 percent of survey respondents expect the West region’s economic performance to stay the same over the coming year, while a nearly equal number of responders expect the economy to perform worse.

n Commercial property sales volume declined in the West region during first quarter 2009, and the 12-month trailing property price averages generally declined.

n The 12-month trailing capitalization rates were mixed dur-ing first quarter 2009.




WestRegionTransactionBreakdown

West Transaction BreakdownCurrent Quarter Rates (01/01/09 - 03/31/09)


















Weighted Avg. (%) 7.4 7.6 6.4 6.3 –


San Diego –“Investors prefer cash flow over anything else. They want no rollover and no capital costs.”

Phoenix –“Vacancy rates in all product types are increasing. Landlord incentives are increasing to obtain new tenants. Cap rates are increasing, which in turn is having a negative impact on value.”

Los Angeles –“Things are slow, at best. ‘Sale or Lease’ and ‘Sub-Lease’ listings are posted daily. Fortunately, the demographics keep things moving. However, it seems that this year is lost to only a few decent commercial transactions.”





$100

$200

$300

$400

$500

$100

$200

$300

$400

$500WestU.S. TotalPrice-Weighted Average PPSF

Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


2%

4%

6%

8%

10%

2%

4%

6%

8%

10%West

U.S. TotalAvg. Capitalization Rate

Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Denve

r


West Office Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Denver $881 $170 $216 $125 7.3

Honolulu $39 $285 $342 $390 –

Las Vegas $223 $247 $272 $249 6.8

Los Angeles $3,619 $271 $327 $239 6.1

Phoenix $654 $162 $203 $164 8.0

Portland $273 $155 $178 $150 8.1

Sacramento $176 $176 $187 $179 6.9

Salt Lake City $112 $141 $182 $115 –

San Diego $1,082 $319 $375 $249 6.5

San Francisco $2,229 $293 $407 $224 6.0

Seattle $643 $224 $258 $215 6.2

Tucson $56 $192 $211 $192 6.5

West Total $10,854 $233 $312 $187 6.3


$50

$100

$150

$200

$250

$300

$350

$50

$100

$150

$200

$250

$300

$350WestU.S. Total


Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


n Office transaction volume in the West region declined by 35 percent on a 12-month trailing average basis during first quarter 2009, as compared to fourth quarter 2008 vol-ume.

n The 12-month trailing average and median prices per square foot of office space declined in first quarter 2009. The weighted average and median capitalization rates in-creased by 60 and 40 basis points, respectively.

West





$0

$50

$100

$150

$200

$250

$0

$50

$100

$150

$200


Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


2%

4%

6%

8%

10%

2%

4%

6%

8%

10%WestU.S. Total


Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Denve

r


West Industrial Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Denver $594 $79 $99 $84 7.2

Honolulu $118 $180 $242 $164 –

Las Vegas $221 $106 $151 $165 6.5

Los Angeles $2,720 $120 $147 $133 6.6

Phoenix $670 $87 $111 $100 7.1

Portland $227 $88 $109 $88 6.5

Sacramento $112 $118 $181 $95 7.1

Salt Lake City $130 $74 $92 $69 7.7

San Diego $524 $154 $181 $164 6.6

San Francisco $1,233 $133 $157 $142 6.7

Seattle $669 $110 $140 $120 7.0

Tucson $91 $87 $108 $87 8.3

West Total $8,327 $104 $138 $110 6.9


$0

$50

$100

$150

$200

$0

$50

$100

$150

$200WestU.S. Total


Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


n First quarter 2009 transaction volume for the West re-gional industrial market fell by about 20 percent from the previous quarter on a 12-month trailing average basis. The size-weighted and price-weighted average price per square foot increased slightly, while the median price de-creased from the previous quarter.

n The first quarter 2009 West regional 12-month trailing weighted average and median capitalization rates for the industrial sector increased by 80 basis points and 20 basis points, respectively.

West





$0

$50

$100

$150

$200

$250

$300

$350

$400

$0

$50

$100

$150

$200

$250

$300

$350


Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


2%

4%

6%

8%

10%

2%

4%

6%

8%

10%WestU.S. TotalAvg. Capitalization Rate

Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Denve

r


West Retail Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Denver $670 $143 $210 $132 7.0

Honolulu $15 $166 $206 $142 –

Las Vegas $239 $243 $307 $228 6.9

Los Angeles $2,171 $260 $377 $241 6.0

Phoenix $769 $207 $287 $162 6.5

Portland $117 $191 $320 $165 6.7

Sacramento $111 $189 $256 $240 6.4

Salt Lake City $55 $120 $156 $140 7.9

San Diego $304 $228 $311 $231 5.5

San Francisco $595 $271 $342 $253 6.2

Seattle $441 $202 $257 $200 7.3

Tucson $136 $148 $225 $142 7.5

West Total $7,169 $188 $296 $170 6.3


$0

$50

$100

$150

$200

$250

$300

$0

$50

$100

$150

$200

$250

$300WestU.S. TotalSize-Weighted Average PPSF

Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

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Honolu

lu

Denve

r


n Although the West region’s retail property transaction vol-ume continued to decline during first quarter 2009, this sector had the smallest decline among the major property types in the region.

n Average and median prices per square foot of retail space decreased during first quarter 2009 as compared to the previous quarter. The 12-month trailing weighted average capitalization rate remained unchanged, while the median capitalization rate decreased 20 basis points.

West





$0

$50,000

$100,000

$150,000

$200,000

$250,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000WestU.S. TotalPrice-Weighted Average PPU

Tucs

on

Seatt

le

San F

rancis

co

San D

iego

Salt L

ake C

ity

Sacra

mento

Portla

nd

Phoe

nix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


3%

4%

5%

6%

7%

8%

3%

4%

5%

6%

7%

8%WestU.S. TotalAvg. Capitalization Rate

Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Denve

r


West Apartment Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Denver $783 $88,348 $123,680 $57,806 6.0

Honolulu $13 $134,595 $146,119 $118,929 –

Las Vegas $261 $78,715 $95,707 $73,585 6.1

Los Angeles $2,309 $144,049 $180,750 $125,000 5.8

Phoenix $474 $84,710 $100,119 $56,775 5.7

Portland $366 $84,858 $91,615 $75,188 6.7

Sacramento $466 $108,490 $116,883 $92,619 6.1

Salt Lake City $120 $81,848 $83,630 $67,929 6.2

San Diego $961 $126,850 $145,446 $118,342 5.6

San Francisco $1,477 $168,570 $196,828 $150,000 5.3

Seattle $1,318 $134,480 $182,270 $121,153 5.3

Tucson $199 $64,580 $96,958 $47,370 6.4

West Total $10,073 $112,814 $154,700 $105,882 5.7


$0

$50,000

$100,000

$150,000

$200,000

$0

$50,000

$100,000

$150,000

$200,000West

U.S. Total


Tucs

on

Seattle

San Fr

ancis

co

San D

iego

Salt La

ke City

Sacram

ento

Portlan

d

Phoen

ix

Los A

ngele

s

Las V

egas

Honolu

lu

Denve

r


n The 12-month trailing average transaction volume of apartment properties in the West region declined by more than 20 percent during first quarter 2009 as compared to the previous quarter. Price per unit decreased from the previous quarter.

n Both the 12-month trailing weighted average and median capitalization rates for the West regional apartment sector increased by 30 basis points.

West




HotelPropertySector

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000WestU.S. TotalPrice-Weighted Average PPU

Seattle

San Fr

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d

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ngele

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r


West Hotel Transactions (04/01/08 - 03/31/09)Volume



Median($/sf)


Denver $123 $82,227 $190,895 $55,631 –

Honolulu $526 $263,713 $298,883 $203,102 –

Las Vegas $822 $239,187 $259,075 $97,339 –

Los Angeles $1,030 $221,143 $314,026 $141,474 6.0

Phoenix – – – – –

Portland $54 $122,792 $160,476 $50,786 –

Sacramento $34 $75,889 $84,011 $64,926 –

Salt Lake City – – – – –

San Diego $111 $130,493 $179,848 $92,574 –

San Francisco $99 $95,386 $112,823 $77,260 –

Seattle $90 $160,081 $192,346 $136,054 –

Tucson – – – – –

West Total $3,427 $161,187 $249,192 $78,431 6.8


$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000West

U.S. Total


Seattle

San Fr

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co

San D

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r


n Transaction volume in the West regional hotel sector de-clined more than 30 percent during first quarter 2009. The size-weighted average and median price per unit de-creased from fourth quarter 2008, while the price-weight-ed average increased.

n The 12-month trailing weighted average and median capitalization rates for the West region’s hotel sector de-creased to 6.8 percent and 8.6 percent, respectively.

West



WestMarketSnapshot

137

West Region Space MarketOffice - 1Q-2009


Denver 91,177 17.4 -623 $20.02 Gross

Honolulu 11,072 9.3 18 $20.62 Net

Las Vegas 30,735 19.1 -416 $27.24 Gross

Los Angeles 177,888 13.9 -1,651 $31.24 Gross

Phoenix 74,621 23.0 204 $24.39 Gross

Portland 41,761 12.9 -161 $21.83 Gross

Sacramento 44,036 18.5 -133 $23.65 Gross

Salt Lake City 28,797 14.3 -281 $19.56 Gross

San Diego 56,227 18.8 -246 $29.01 Gross

San Francisco 87,245 12.0 -1,118 $32.60 Gross

Seattle 82,452 12.7 -166 $26.76 Gross

Tucson 7,832 15.3 -9 $20.97 Gross


Denver 235,823 11.7 -1,437 $6.30 Net

Las Vegas 89,467 9.4 -201 $7.98 Net

Los Angeles 923,891 6.5 -8,835 $7.32 Net

Phoenix 275,329 17.1 -2,589 $7.12 Net

Portland 191,014 8.9 -1,679 $5.85 Net

Sacramento 163,581 14.5 -1,576 $6.06 Net

Salt Lake City 130,610 9.0 -857 $5.28 Net

San Diego 195,922 12.6 -1,591 $11.56 Net

San Francisco 100,354 8.3 -740 $15.38 Net

Seattle 285,448 9.0 -1,933 $7.46 Net

Tucson 35,430 7.3 -4 $7.87 Gross


Denver 41,825 12.0 1 $20.33

Honolulu 11,284 4.2 62 $28.45

Las Vegas 27,081 6.1 260 $26.03

Los Angeles 67,646 6.0 -19 $28.62

Phoenix 65,453 11.5 1 $24.93

Portland 22,935 8.9 92 $22.09

Sacramento 24,949 12.0 110 $29.59

Salt Lake City 10,553 7.2 53 $12.94

San Diego 40,619 7.8 -95 $26.75

San Francisco 10,394 3.4 -52 $18.95

Seattle 27,520 9.1 -160 $23.39

Tucson 12,978 12.3 26 $18.11







RERC extends its appreciation to CBRE/Torto Wheaton Research,

which contributed all of the space market information on this page.




138



Denver MSA 2.5 million Denver2 8.2%

Denver Growth1 1.78% Colorado2 7.9%






Major Employers

Denver International Airport

CU School of Medicine

Transportation Safety Office

Molson Coors Brewing Company

Printers PersonnelSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Denver Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

2901 W. 19th St. 2-09 $1,170,000 11,434 $102

Industrial

5125 Race Court 1-09 $6,000,000 135,322 $44

4990 Iris St. 2-09 $4,200,000 67,437 $62

Retail

2281 E. Arapahoe Road 1-09 $7,660,000 14,820 $517

200 Columbine St. 1-09 $6,300,000 12,739 $495

Apartment

2850-2890 Kalmia Ave. 2-09 $20,900,000 161 $129,814

Turnberry at Heather Ridge 2-09 $15,100,000 268 $56,343

Hotel

8000 E. Peakview Ave. 3-09 $6,950,000 86 $80,814Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Hilton Garden Inn Hotel N 225 2010

The Seasons of Cherry Creek Multifamily N 439 2010

1800 Larimer Office N 500,000 2010

Embassy Suites Hotel N 250 2010Sources: CBRE, RE Business.

De

nve

rMetro Trend Analysis

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139

Denver Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Denver Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -3% 1% -12% -4% -5%

% Change Year Ago 0% 7% -6% -11% -49%

Volume % Change Quarter Ago -32% -18% 3% -24% -62%




140



Honolulu MSA 917,673 Honolulu2 5.8%

Honolulu Growth1 0.60% Hawaii2 7.0%






Major Employers

Bank of Hawaii

Queen’s Medical Center

Aloha Airlines

Honolulu Police Department

Oahu Transit Service Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Honolulu Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

1100 Alakea St. 2-09 $2,139,000 5,797 $369

Industrial

3215 Oihana St. 3-09 $1,415,000 9,600 $147

73-5564 Olowalu St. 2-09 $2,800,000 17,022 $164Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.

Ho

nolu

lu Metro Trend AnalysisPrevious Quarter

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Industrial


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Hotel





141

Honolulu Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) – $81 – – $526

Size Weighted Avg. ($ per sf/unit) – $197 – – $263,713

Price Weighted Avg. ($ per sf/unit) – $273 – – $298,883

Median ($ per sf/unit) – $248 – – $203,102







Honolulu Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 6% -17% – 0% 4%

% Change Year Ago – -13% – -20% -18%

Volume % Change Quarter Ago -23% -2% – -22% 2%

% Change Year Ago – -7% – -94% -78%Source: RERC.



142



Las Vegas MSA 2.0 million Las Vegas2 10.4%

Las Vegas Growth1 4.08% Nevada2 10.5%






Major Employers

Bellagio Hotel

Wynn Las Vegas

MGM Grand Las Vegas

Mirage

Venetian Resort Hotel & CasinoSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Las Vegas Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

7130 Smoke Ranch Road 2-09 $12,648,000 95,092 $133

823 S. Sixth St. 2-09 $3,000,000 10,134 $296

Industrial

6340 Sunset Corporate Drive 1-09 $3,000,000 19,924 $151

4111 W. Oquendo Road 3-09 $1,650,000 10,528 $157

Retail

3720 W. Tropicana Ave. 1-09 $7,500,000 20,642 $363

Horizon Village Square 1-09 $3,330,000 8,400 $396

Apartment

Woodcreek Villas 2-09 $7,500,000 75 $100,000Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq.Ft./Units

Estimated Delivery

St. Regis Residences at Venetian Plazzo Multifamily N 398 2010

8845 W. Flamingo Road Office N 17,450 2009

Crowne Plaza Hotel N 386 2010

Par 3 Landscape and Maintenance

Industrial/Office N

28,603/12,000 2009

Sources: CBRE, RE Business.

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143

Las Vegas Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Las Vegas Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% -3% -9% 0% -29%

% Change Year Ago 0% 5% -14% -10% -46%





144



Los Angeles MSA 13.4 million Los Angeles2 10.6%

Los Angeles Growth1 0.83% California2 11.5%






Major Employers

UCLA

University of Southern California

Los Angeles Police Department

Women & Children’s Hospital

Kaiser Foundation HospitalSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Los Angeles Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

5051 Verdugo Way 1-09 $15,400,000 51,354 $300

1017 N. Las Palmas Ave. 1-09 $25,689,000 83,950 $306

Industrial

710 Epperson Drive 1-09 $7,900,000 52,049 $152

Monterey Park 1-09 $8,100,000 54,103 $150

Retail

Hacienda Retail Center 1-09 $15,500,000 66,605 $233

The Pavilion at La Quinta 3-09 $41,200,000 166,100 $248

Apartment

Glo 3-09 $76,500,000 201 $380,597

12401 Studebaker Road 1-09 $22,900,000 153 $149,673Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

LA Live Mixed Use N 4,000,000 2010

Grand Avenue Project Mixed Use N 3,800,000 2010

Dr. Pepper Snapple Industrial N 850,000 2010

2025 Avenue of the Stars (Century Plaza) Mixed Use N 1,400,000 N/ASources: CBRE, RE Business.

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145

Los Angeles Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)













Capitalization Rates (All Transactions)Weighted Average (%) 6.1 6.6 6.0 5.8 6.0


Los Angeles Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -5% -1% -3% -4% –

% Change Year Ago -11% -5% -1% -1% –





146



Phoenix MSA 4.4 million Phoenix2 7.2%

Phoenix Growth1 3.68% Arizona2 7.7%






Major Employers

Phoenix Sky Harbor International Airport

Intermodal Transportaion Division

Barrow Neurological Institute

Deer Valley Unified School District

Honeywell InternationalSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Phoenix Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

9023 E. Desert Cove Ave. 1-09 $1,575,000 7,166 $220

2045 S. Vineyard 1-09 $2,800,000 15,630 $179

Industrial

450 E. Elliot Road 1-09 $8,500,000 22,172 $383

PODs Distribution Center 1-09 $7,100,000 85,000 $84

Retail

1320 W. Broadway Road 2-09 $1,800,000 27,000 $67

6730 W. Camelback Road 3-09 $19,800,000 96,767 $205

Apartment

10255 E. Via Linda 3-09 $32,000,000 350 $91,429

650 S. Country Club Drive 3-09 $8,500,000 151 $56,291Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Opus West Retail N 170,000 2009

Mesa Riverview Mixed Use N 10,889,865 2015

Tanger FactoryOutlet Center Retail N 330,000 2010

CityScape Center Mixed Use N 2,500,000 2009 - 2011Sources: CBRE, RE Business.

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eni

x Metro Trend AnalysisPrevious Quarter

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147

Phoenix Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Phoenix Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -1% 1% -5% -14% –

% Change Year Ago -1% -6% -10% -21% –





148



Portland MSA 2.2 million Portland2 11.8%

Portland Growth1 1.78% Oregan2 12.9%






Major Employers

University Hospital Clinics

Portland Community College

Portland International Airport-PDX

U.S. Post Office

TrimetSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Portland Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

Spalding Building 3-09 $12,500,000 98,769 $127

1245 SW 158th Ave. 1-09 $1,500,000 10,000 $150

Industrial

111 SE Belmont St. 3-09 $2,850,000 80,000 $36

838 SE Stark St. 2-09 $1,000,000 6,400 $156

Retail

1110 NE WoodVillage Blvd. 3-09 $2,800,000 7,551 $371

Apartment

Hadley House 2-09 $7,300,000 55 $132,727

Powell Court 1-09 $6,200,000 72 $86,111Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Shops onBrooklyn Yard Retail N 52,000 2009

Broadstone Enso Mixed Use N 152 2010

Trammell Crow Industrial at Tualatin Industrial N 278,920 2010Sources: CBRE, RE Business.

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149

Portland Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Portland Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -6% 1% 10% 0% -44%

Volume % Change Quarter Ago -22% -25% -28% -57% 7%




150



Sacramento MSA 2.2 million Sacramento2 11.3%

Sacramento Growth1 2.23% California2 11.5%






Major Employers

Sacramento County Water Quality

Social Services Department

UC Davis

Intel Corporation

Hewlett-Packard Co.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Sacramento Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

6601 Elvas Ave. 3-09 $2,190,000 30,600 $72

Broadstone Business Center 3-09 $6,300,000 60,568 $104

Industrial

FedEx Freight West 3-09 $40,300,000 127,436 $316

600 Industrial Drive 2-09 $1,510,000 25,200 $60

Retail

395 N. Sunrise Ave. 1-09 $1,228,000 7,710 $159

1600 Howe Ave. 2-09 $11,200,000 59,082 $190

Apartment

Marbella Apartments 2-09 $1,280,000 16 $80,000Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

The Railyards Mixed Use N 1,300,000 2012

500 Capitol Mall Office N 430,000 2009

E. NatomasEducation Center Office N 293,450 2010Sources: CBRE, RE Business.

Sac

ram

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151

Sacramento Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Sacramento Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -1% – 2% 2% -35%

% Change Year Ago -38% 12% 3% 13% -33%

Volume % Change Quarter Ago -43% – -33% -15% -6%




152



Salt Lake City MSA 1.1 million Salt Lake City2 5.2%

Salt Lake City Growth1 1.75% Utah2 5.4%






Major Employers

University Hospital

Huish Detergents Inc.

OC Tanner Co.

University of Utah

Staker & Parson Co.Sources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Salt Lake City Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

490 E. 500 South 2-09 $1,100,000 6,140 $179

4065 Commerce Drive 1-09 $1,250,000 15,918 $79

Industrial

2280 Alexander St. 3-09 $1,688,000 30,094 $56

170 W. 1700 South 2-09 $3,000,000 7,590 $395

Retail

308 W. 7200 South 1-09 $1,494,000 13,465 $111

Apartment

3500 Mark IV 2-09 $2,350,000 38 $61,842Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Cottonwood Mall Retail R 730,000 2010

City Creek Center Mixed Use N N/A 2011

222 South Main Office N 420,000 2009Sources: CBRE, RE Business.

Salt

Lake


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153

Salt Lake City Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)




Median $115 $66 $140 $55,714 –

> $5 MillionVolume (Mil) – $79 – $112 –

Size Weighted Avg. – $76 – $84,958 –

Price Weighted Avg. – $87 – $85,445 –

Median – $69 – $82,996 –




Median $115 $69 $140 $67,929 –

Capitalization Rates (All Transactions)Weighted Average – 7.7 7.9 6.2 –

Median – 7.7 7.8 6.0 –Source: RERC.

Salt Lake City Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -6% -8% 7% -8% –

% Change Year Ago 4% 7% 8% -15% –





154



San Diego MSA 3.1 million San Diego2 9.3%

San Diego Growth1 0.73% California2 11.5%






Major Employers

Sempra Energy

Sharp Memorial Hospital

University of California at San Diego

County of San Diego

Scripps HealthSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - San Diego Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

6310 Greenwich Drive 1-09 $13,000,000 75,518 $172

11050, 111065, 11075 Roselle St. 2-09 $14,450,000 64,000 $226

Industrial

12400 Stowe Drive 1-09 $15,000,000 133,125 $113

692 - 694 Rancheros Drive 3-09 $3,500,000 21,203 $165

Retail

Loma Vista Center 2-09 $4,840,000 25,635 $189

Sweetwater Village 1-09 $6,200,000 43,400 $143

Apartment

3265 - 3285 5th Ave. 1-09 $10,250,000 25 $410,000

Buena Vista Apartments 1-09 $9,000,000 89 $101,124Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

San Elijo Hills Towne Center Retail N 130,000 N/A

Bay View Village Retail N 11,160 N/ASources: CBRE, RE Business.

San

Die

go Metro Trend Analysis

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155

San Diego Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















San Diego Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -3% 3% 9% 0% -19%





156



San Francisco MSA 4.3 million San Francisco2 9.5%

San Francisco Growth1 0.54% California2 11.5%






Major Employers

Pacific Telesis Group

UPS Supply Chain Solutions

California State Automobile

San Francisco State University

UCSF Medical CenterSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - San Francisco Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

Golden Bear Center 3-09 $53,000,000 171,000 $310

560-564 Gateway Drive 3-09 $5,250,000 31,840 $165

Industrial

2040-2050 Martin Ave. 1-09 $13,000,000 83,055 $157

1800-1810 Dobbin Drive 1-09 $6,300,000 81,475 $77

Retail

180 University Ave. 2-09 $16,200,000 36,920 $439

1 Bolivar Drive 1-09 $2,200,000 8,846 $249

Apartment

3390 El Camino Real 3-09 $3,300,000 34 $97,059

565 Saratoga Ave. 3-09 $2,600,000 16 $162,500

Hotel

The University Hotel in Berkeley 3-09 $2,550,000 50 $51,000Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

Turnberry Tower Multifamily N 305 N/A

NVIDIA Corp.Headquarters Office R 1,900,000 N/A

SFO Logistics Center Industrial R 572,000 2009

Presidio Project Multifamily N 161 2010Sources: CBRE, RE Business.

San

Fra

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co Metro Trend Analysis

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157

San Francisco Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)









All TransactionsVolume (Mil) $2,229 $1,233 $595 $1,477 $99






San Francisco Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago -9% 0% -1% 0% 2%

% Change Year Ago -19% 4% 6% -3% -31%





158



Seattle MSA 3.4 million Seattle2 8.9%

Seattle Growth1 1.40% Washington2 9.7%





1-year Job Additions 200 Median Home Price $325,900

Major Employers

University of Washington

Swedish Medical Center

Regence Blue Shield-Washington

Virginia Mason Nutrition Specialist

VariliteSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Seattle Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

4900 25th Ave. NE 2-09 $8,000,000 25,735 $311

1951 152nd Ave. NE 2-09 $9,750,000 31,568 $309

Industrial

600 S. 96th St. 3-09 $16,600,000 46,450 $357

2000 Taylor Way 3-09 $11,750,000 99,750 $118

Retail

H Mart 2-09 $14,900,000 77,028 $193

Orilla Station Shopping Center 2-09 $11,100,000 53,911 $206

Apartment

Bronson Place 1-09 $7,400,000 70 $105,714

Colina Square 1-09 $6,800,000 36 $188,889Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.


Property Type


Total Sq. Ft./Units

Estimated Delivery

South Lake Union Office N 75,000 2011

Escala Multifamily N 270 N/A

Bill & Melinda Gates Foundation HQ Office N 900,000 2010

Amazon Headquarters Office N 1,600,000 2010Sources: CBRE, RE Business.

Sea

ttle Metro Trend Analysis

Previous Quarter

Previous Year

Office



Industrial



Retail



Apartment



Hotel



Office

vs. West Region =

vs. Nation

Industrial

vs. West Region =

vs. Nation =

Retail

vs. West Region

vs. Nation

Apartment

vs. West Region

vs. Nation




159

Seattle Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)





> $5 MillionVolume (Mil) $474 $439 $259 $1,106 $79




All TransactionsVolume (Mil) $643 $669 $441 $1,318 $90






Seattle Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)


% Change Year Ago -12% 0% 0% 9% –





160



Tucson MSA 1.0 million Tucson2 7.0%

Tucson Growth1 2.38% Arizona2 7.7%






Major Employers

University of Arizona

University Medical Center

Southwest Emergency Association

Tuscon Medical Center

Raytheon Missle SystemSources: Bureau of Labor Statistics, NAR, STDB Online.“2008 Local Market Report” - Tucson Region ©2008 NATIONAL ASSOCIATION OF REALTORS®. Used with permission. Reproduction, reprinting, or retransmission of this document in any form (electronic media included) is prohibited without written permission.1Projected annual growth over 5 years (2008-2013). 2Rates are non-seasonally adjusted as of March 2009. 3Rates are non-seasonally adjusted as of April 2009.



Office

540 West Prince Road 2-09 $600,000 7,490 $80

Industrial

5850 N. Seanifer Drive 2-09 $1,450,000 9,377 $155

40 W. Plata St. 3-09 $675,000 10,775 $63

Retail

1944 E. Allen Road 1-09 $3,250,000 11,614 $280

5100 E. Broadway Blvd. 1-09 $2,150,000 7,042 $305

Apartment

Pantano Villas 1-09 $5,300,000 127 $41,732

Casa Blanca Apartments 1-09 $2,000,000 41 $48,780Compiled by RERC for the RERC/CCIM Investment Trends Quarterly report.

Tuc

son Metro Trend Analysis

Previous Quarter

Previous Year

Office



Industrial



Retail



Apartment




Office

vs. West Region

vs. Nation

Industrial

vs. West Region

vs. Nation

Retail

vs. West Region

vs. Nation

Apartment

vs. West Region

vs. Nation




161

Tucson Transaction Breakdown12-Month Trailing (04/01/08 - 03/31/09)















Tucson Transaction Trends12-Month Trailing (04/01/08 - 03/31/09)

Office Industrial Retail Apartment HotelMedian Price% Change Quarter Ago 0% 2% 2% -3% –

% Change Year Ago – 14% 5% 2% –


% Change Year Ago – -61% 41% -41% –Source: RERC.


second quarter 2009 report investment trends vol. … · second quarter 2009 report investment...

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