Office Outlook. Brisk beginning to the year means fewer options and rising rents. New York Q1 2014

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1 Office Outlook New York Q risk beginning to the year means fewer options and rising rents Strong demand from the creative industries throughout Manhattan but especially in Midtown South drove leasing activity higher and absorption into positive territory in the first quarter of The shrinking supply of value and sublease space spurred higher asking rental rates. Midtown Class rents have increased 15 quarters in a row to $76.30 per square foot. High-quality opportunities at comparatively low prices are driving tenants particularly those in the legal services, media, advertising and technology sectors Downtown from elsewhere in Manhattan.

2 Jones Lang LaSalle Office Outlook New York Q New York overview Strong demand from the creative industries throughout Manhattan but especially in Midtown South drove leasing activity higher and absorption into positive territory in the first quarter of Landlords, sometimes negotiating with multiple tenants for the same space, have raised rents and bumped tenants a practice not widely seen since before the recession. sking rents rose and concessions decreased, not only for red-hot Midtown South properties and the Trophy set, but for the broader Manhattan market. Meanwhile, tenants in search of a dwindling number of value options increasingly shifted their attention to Downtown, where high-quality space remains available at comparatively low prices. For the third consecutive year, New York City gained more population than it lost through migration, reversing a trend that stretched back to the mid-20th century. Economists cite the city's expanding economy and job growth. High-tech continued to dominate job creation and boasted the largest yearly sector expansion at 8.3 percent. The fashion, apparel and design industries also remained active, feeding demand for creative space, especially in Midtown South and the Penn Plaza submarket. In contrast, a record stock market has not translated into significant hiring by Wall Street firms. Financial and legal services historically the greatest drivers of the Manhattan Class market have seen only small employment gains, resulting in positive but less robust absorption of large block Class space, particularly Downtown. Overall Midtown South vacancy decreased to 7.0 percent from 7.5 percent over the same period, while rents reached at an all-time high at $58.23 per square foot. Consistent demand combined with newly renovated space at 114 Fifth venue and 90 Fifth venue both of which ask premium rents drove the average higher. While creative companies, including many start-ups, are typically more cost-sensitive, established tenants in media and technology are paying premium rents for high-quality product in desirable locations. eyond Midtown South, the shrinking supply of value and sublease space has put upward pressure on asking rental rates. Midtown Class rents have increased 15 quarters in a row to $76.30 per square foot. t quarter-end, sublease space represented only 20.5 percent of the available Class Midtown supply, down from 35.1 percent in The most visible example of this has been on venue of the mericas at one point a bastion of large blocks of financial services surplus space where Class vacancy rate decreased to 12.1 percent from 16.0 percent at year-end Meanwhile, the top of the Trophy market, typically defined as leases starting above $100 per square foot, is quickly approaching the historical peak years of 2007 and 2008, both in Major leases, those 100,000 square feet or greater, doubled to 14 in the first quarter of 2014 from seven at this time last year. vailable Midtown South large blocks declined by half, from 10 to five, over the same period, due in large part to Credit Suisse s 1.2-million-square-foot renewal at 11 Madison venue, Twitter s 144,000-square-foot lease at 245 and 249 West 17th Street, and IM s 118,425-square-foot lease at 51 stor Place for its Watson Group. s a result, Midtown South Class vacancy dropped to 6.9 percent from 7.7 percent in January.

3 Jones Lang LaSalle Office Outlook New York Q terms of velocity and pricing. Manhattan s top buildings report starting rents of $200 per square foot for the best space. The Downtown market, however, still has room to recover. The overall vacancy rate increased slightly to 13.2 percent, largely the result of Thompson Reuters intent to relocate 450 employees to Hoboken and vacate 447,829 square feet at 195 roadway. High-quality opportunities and comparatively low pricing, however, are driving tenants particularly those in the legal services, media, advertising and technology sectors Downtown from elsewhere in Manhattan. In the first quarter, both Revlon and Macmillan Science and Education Group signed leases to move Downtown. pproximately one-third of all new leases Downtown in the first quarter were relocations from outside the district the highest of any market by far. Several major leases, including those in the less active financial and legal services industries, are scheduled to close by year-end. Competition and pricing for large blocks could increase as options diminish. Without a sudden economic or political shock, rents will likely trend higher through 2014 and accelerate into Longer-term, Manhattan remains fundamentally supply-constrained. ccording to employment forecasts, by 2018 Manhattan office-using employment will surpass the all-time peak of 2000, yet total office inventory has not significantly changed. Most new construction in Midtown is scheduled to be completed beyond New trends are already starting to form as tenants adjust to a more expensive market. Established Midtown tenants will continue to migrate Downtown and to the West Side for more affordable options while start-up tenants are beginning to scout emerging submarkets in rooklyn and Queens. Tristan shby Vice President, Research Director

4 Jones Lang LaSalle Office Outlook New York Q Capital Markets overview The New York City investment sales market witnessed an exceptionally strong start to 2014 with over 100 deals closed and an additional 45 transactions under contract saw the highest number of sales transactions in a year, with 346. The first quarter of 2014 saw a total of $6.1 billion in closed transactions, a 9.0 percent increase from the first quarter of The total value of closed and under contract deals was $16.4 billion, a percent increase from the first quarter of The retail and retail condominium sales market is poised for its most active year ever. With 22 closed transactions totaling $1.5 billion through the first quarter of 2014, the retail sector accounted for 25.0 percent of the total investment sales market. Unprecedented rental growth fueled by record tourism spending, a weak dollar and increased local consumer spending in prime retail corridors is driving the retail investment sales market. Notable retail transactions this quarter included 530 roadway, 90 Prince Street, 114 Prince Street, 170 roadway and 733 Madison venue. Manhattan office sales accounted for more than 42 percent of gross sales activity with $2.6 billion in transactions. Downtown office properties continued as the most sought-after assets in the city, with notable transactions at 55 roadway, 61 roadway, 90 road Street, 110 William Street, 156 William Street and 160 Water Street. The price per square foot metric continued to rise, due in large part to investor demand for the retail component of some Class buildings. Midtown Class office sales set a new price per square foot record at $1,383. Cap rates dropped slightly to 4.2 percent. Uneven economic data continued to cause macroeconomic uncertainty. The U.S. unemployment rate remained stable at 6.7 percent with March payroll data increasing by 192,000, while the U.S. economy grew at 3.0 percent, despite the harsh winter weather throughout most of the nation. The Federal Reserve Chairwoman, Janet Yellen, indicated that short-term interest rates will not be raised until at least While job data continues to show promise, the Fed is concerned about the number of underemployed and job seekers who have removed themselves from the labor market. The 10-year treasury closed the first quarter at 2.8 percent 23 basis points lower than the beginning of the quarter. U.S. CMS volume fell 11.0 percent from 1Q13 and the pipeline of new transactions is anticipated to remain unchanged from last year s second quarter. Despite the slowdown in the CMS market, traditional banks, mortgage REITs, private equity funds and other lenders from across the spectrum have become active in the market. This increased competition, coupled with limited deal volume, has resulted in a compression of spreads from basis points in the senior loan market and basis points in the mezzanine loan market. Scott Latham Vice Chairman Jon Caplan Vice Chairman Yoron Cohen Vice Chairman Richard axter Vice Chairman marked supply/demand imbalance in the residential market is fueling investment in multi-family product and driving pricing for development parcels to record levels. Some prime development sites now command in excess of $1,000 per square foot.

5 Jones Lang LaSalle Office Outlook New York Q New York property clock Midtown South Peaking market Falling market Rising market Stabilizing market Midtown Downtown Clock description This diagram illustrates JLL s estimate of the location of each prime office market within its individual rental cycle at the end of the quarter Markets can move around the clock at different speeds and directions The diagram is a convenient method of comparing the relative position of markets in their rental cycle The position is not necessarily representative of investment or development market prospects The position refers to prime face rental values Q positions Midtown South Strong leasing activity should continue as two high profile tenants, Sony and Google, are expected to close large transactions by year-end. Increasing consumer confidence which fuels demand for fashion and other retail offerings and rising high-tech employment should also bode well for Midtown South over the coming quarters. Midtown Several large leases expected to close in the coming months should reduce Midtown Class supply, thereby pushing rents higher. While growth will most likely come from media, high-tech and fashion, the banking sector could surprise with limited expansion. t the top of the Midtown market, ongoing demand from boutique hedge fund and private equity firms is predicted to further escalate rents in Midtown s most prestigious buildings. While Midtown South no longer provides an escape for costsensitive tenants, some could be lured to Downtown where Class options are priced comparable to Midtown Class product. Downtown The Downtown office market should see vacancy trend downward through internal growth and intra-city relocations as renewed tax incentives and discounted rents continue to make it an attractive alternative to rising rents and reduced opportunities in Midtown and Midtown South.

6 Jones Lang LaSalle Office Outlook New York Q New York market definitions The New York City market is comprised of three major submarkets: Downtown, Midtown and Midtown South Manhattan. These markets are further divided into four, five and five submarkets, respectively. Downtown submarkets: Tribeca/City Hall, World Trade Center, Financial District, Water Street Corridor Midtown submarkets: Columbus Circle, Plaza District, Grand Central, Times Square, Penn Plaza/Garment District Midtown South submarkets: Chelsea, Hudson Square, Gramercy Park, SoHo, Greenwich Village

7 Jones Lang LaSalle Office Outlook New York Q New York space statistics Current inventory (s.f.) Under construction (s.f.) YTD completion (s.f.) Overall net absorption (s.f.) YTD overall net absorption (s.f.) YTD overall net absorption (% of inventory) Overall vacancy Overall asking rent (gross $ p.s.f.) Downtown Financial District 21,472, ,331 82, % 11.0% $39.64 Tribeca/City Hall 19,200, (81,493) (81,493) (0.4%) 4.3% $39.33 Water Street Corridor 23,621, ,688 22, % 14.4% $45.96 World Trade Center 18,505,067 3,038,168 0 (30,383) (30,383) (0.2%) 25.4% $67.11 Downtown market totals 100,657,081 3,038,168 0 (6,857) (6,857) 0.0% 13.2% $53.39 Midtown Columbus Circle 25,227, ,302 (96,302) (0.4%) 7.8% $69.47 Grand Central 70,967, , , % 12.8% $61.00 Penn Plaza / Garment District 44,032,596 2,173, , , % 10.6% $50.22 Plaza District 100,575, ,796 5, % 11.4% $82.21 Times Square 38,920, (843,785) (843,785) (2.2%) 11.1% $72.83 Midtown market totals 279,723,162 2,173,672 0 (436,657) (436,657) (0.2%) 11.2% $68.99 Midtown South Chelsea 21,316, , , , % 6.5% $56.09 Gramercy Park 21,676, , , % 7.6% $60.73 Greenwich Village 5,846, , , % 5.1% $67.17 Hudson Square 9,577, ,386 51, % 8.2% $53.96 SoHo 4,725,666 37,000 0 (75,620) (75,620) (1.6%) 7.1% $58.48 Midtown South market totals 63,143, , , , % 7.0% $58.23 Market totals 443,523,324 5,444, , , % 11.1% $64.26

8 New York Downtown Jones Lang LaSalle Office Outlook New York Q

9 Jones Lang LaSalle Office Outlook New York Q New York Downtown boundaries Tribeca/City Hall South of Canal Street, west of the East River and Pearl Street, north of nn Street and east of West Street. Financial District South of nn Street, west of Pearl Street, east of the Hudson River, south of lbany Street and east of Trinity Street. World Trade Center South of Vesey Street, but inclusive of 7 World Trade Center, west of Trinity Place, north of lbany Street and east of the Hudson River. Water Street Corridor South of the rooklyn ridge, west of the East River and east of Pearl Street.

10 Jones Lang LaSalle Office Outlook New York Q Downtown Quarter in review Downtown closed the first quarter with strong velocity and higher rents as high-quality availabilities at competitive prices continued to attract interest from tenants throughout Manhattan. Leasing velocity picked up late in the quarter possibly a positive sign of forthcoming trends as six of the seven largest leases were signed in late February and March. This late activity helped to produce positive absorption in two of the four Downtown submarkets Financial District and Water Street Corridor but was not enough to outweigh the new spaces that came on the market, resulting in negative absorption overall for the market. pproximately one-third of all new leases Downtown have been relocations. The legal services sector accounted for the greatest number of relocations, followed by high-tech and nonprofit tenants. Submarket boundaries map Class vacancy rose 80 basis points from year-end 2013 as a result of several large blocks that came on the market. Thomson Reuters made 447,829 square feet available at 195 roadway, while 125,839 square feet at 55 Water Street and 114,054 square feet at 1 New York Plaza also became available. The addition of these blocks had a significant impact on the Water Street Corridor, bringing the submarket s Class vacancy up from 11.6 percent one year ago to 16.4 percent at the end of the first quarter of this year. Class vacancy also rose albeit at a comparatively muted pace, only increasing 30 basis points from 9.7 percent to 10.0 percent over the same period. Relocations continued in the first quarter as 17 tenants signed new leases totaling approximately 597,000 square feet, or 33.0 percent of all new Downtown commitments. Tenants previously located in Midtown accounted for 58.8 percent of these relocations. Two of the largest relocations Downtown took place at 1 New York Plaza, a Class property: Macmillan Science and Education Group signed the largest relocation as well as the largest lease for the quarter by taking 176,121 square feet, followed by Revlon, which committed to 90,194 square feet. nother significant lease was signed by llied World lliance, which renewed and expanded at 199 Water Street for 143,297 square feet. Overall average asking rental rates Downtown rose to $53.39 per square foot this quarter, an increase of 6.4 percent from $50.19 per square foot at year-end Lower Manhattan s Class rents grew to $57.10 per square foot, an increase of 4.3 percent from $54.77 per square foot from the previous quarter. Downtown Class rents remain at a 25.0 percent discount to Midtown and Midtown South. One World Trade Center is nearing completion and expected to be ready for occupancy in the fourth quarter of this year. In late 2013, the advertising firm GroupM signed a 516,000-square-foot lease to become the anchor tenant at the future 2.8-million-square-foot 3 World Trade Center. Work on the retail base of 3 World Trade Center has already commenced, with construction on the tower to begin upon the achievement of its construction loan. Key market indicators Stock Overall net absorption 100,657,081 s.f. (6,857) s.f. Overall vacancy rate 13.4% verage asking rent Under construction $53.29 p.s.f. 3,020,630 s.f. Market outlook The Downtown office market should see vacancy trend downward through internal growth and intra-city relocations as renewed tax incentives and discounted rents continue to make it an attractive alternative to rising rents and reduced opportunities in Midtown and Midtown South. However, this overall decline in vacancy may be intermittently skewed by the pending deliveries of large blocks of Trophy space in the World Trade Center submarket. Nevertheless, the market s improving optics the completion of two World Trade Center towers and the transportation hub, major new and renewal commitments, higher-value retail and housing, and burgeoning demographics in nearby rooklyn and New Jersey bode well for greater office demand and higher net effective rent growth over the long-term.

11 Jones Lang LaSalle Office Outlook New York Q Downtown verage rental rates (Class vs. Class ) Overall new deliveries / overall net absorption / overall vacancy rates $ psf $60 $55 $50 $45 $40 $35 $30 Class rental rate Class rental rate s.f. in millions New deliveries YTD Vacancy Class YTD Net absorption YTD Vacancy Class YTD 18% 16% 14% 12% 10% 8% 6% $ Q Q % Significant lease transactions Macmillan Science and Education Group 1 New York Plaza llied World Insurance 199 Water Street Revlon 1 New York Plaza Trinity Church 120 roadway 176,121 s.f. 143,297 s.f. 90,194 s.f. 68,350 s.f. Large availabilities 1 World Trade Center Class 1,182,383 s.f. 4 World Trade Center Class 1,034,969 s.f. 180 Maiden Lane Class 713,903 s.f. 225 Liberty Street Class 704,967 s.f. Recent sales transactions 35 East roadway 24,157 s.f. 90 road Street 420,000 s.f. 156 William Street 218,000 s.f. Class C $836 / p.s.f. Class $306 / p.s.f. Class $285 / p.s.f.

12 New York Midtown Jones Lang LaSalle Office Outlook New York Q

13 Jones Lang LaSalle Office Outlook New York Q New York Midtown boundaries Columbus Circle South of West 66 th Street, west of Central Park West and venue of the mericas, north of West 50 th Street, east of the Hudson River. Plaza District South of East 65 th Street, west of the East River, north of 47 th Street, east of Sixth venue. Grand Central South of East 47 th Street, north of East 30 th Street, east of Fifth venue. Times Square South of West 50 th Street, west of Sixth venue, north of West 40 th Street, east of the Hudson River. Penn Plaza / Garment South of 40 th Street, west of Fifth venue, north of 30 th Street, east of the Hudson River.

14 Jones Lang LaSalle Office Outlook New York Q Midtown Quarter in review Despite the addition of a few new large blocks of available space, the Midtown market continued to show strength in the first quarter of 2013 with robust leasing activity and increasing rents. Ongoing demand for high-quality and value space drove activity. The Class vacancy rate declined year-over-year to 12.1 percent from 12.9 percent last March, while asking rents increased 4.7 percent to $76.30 per square foot. Submarket boundaries map Though Class vacancy was down year-over-year, it rose 40 basis points since year-end as a result of the addition of 817,252 square feet at 4 Times Square. Condé Nast will vacate the space later this year when it relocates Downtown to One World Trade Center. The addition of this space had a greater impact on the Times Square submarket, boosting the Class vacancy rate to 12.0 percent from 8.6 percent at year-end. With strong demand coming from creative industries priced out of Midtown South, the supply of Midtown value space in Class assets tightened, declining to 9.7 percent from 10.7 at this time last year. s a result of this demand, the growth in Midtown Class asking rents outperformed Class rents, rising 6.7 percent year-over-year to $52.07 per square foot. Strong leasing activity produced positive absorption in three of the five Midtown submarkets Grand Central, Penn Plaza/Garment District and Plaza District but was not enough to outweigh new space added to the market in Columbus Circle and Times Square. Large renewals dominated leasing activity in the first quarter, accounting for half of recorded leases over 50,000 square feet. However, the two largest transactions of the quarter were both new leases: Mount Sinai Medical Center s lease of 448,819 square feet at 150 East 42nd Street and New York & Company s 178,342 square feet at 330 West 34th Street. dvertising and public relations firm Publicis also signed a sublease for 113,945 square feet from Direct rands at 1 Penn Plaza. fter struggling with an abundance of short-term sublease space over the past two years, venue of the mericas experienced a fifth straight quarter of declining Class vacancy in the first three months of vailable space amounted to 12.1 percent of the venue s inventory as of the end of March following a high of 16.0 percent in the fourth quarter of decline in Class sublease vacancy to 2.9 percent from 5.6 percent at year-end 2012 contributed to much of the decrease. The removal of this sublease space also impacted rents over the same time period: Class asking rents for the venue rose 8.0 percent to $77.34 per square foot. Key market indicators Stock Overall net absorption 279,723,162 s.f. -436,657 s.f. Overall vacancy rate 11.2% verage asking rent Under construction $68.99 p.s.f. 2,173,672 s.f. Market outlook Several large leases expected to close in the coming months should reduce Midtown Class supply, pushing rents higher. ctivity particularly in the financial and legal sectors will be driven largely by renewals and relocations. While growth will most likely come from media, high-tech and fashion, the banking sector could surprise with limited expansion. t the top of the Midtown market, ongoing demand from boutique hedge fund and private equity firms is predicted to further escalate rents in Midtown s most prestigious buildings. While Midtown South no longer provides an escape for cost-sensitive tenants, some could be lured to Downtown where Class options are priced comparable to Midtown Class product.

15 Jones Lang LaSalle Office Outlook New York Q Midtown verage rental rates (Class vs. Class ) Overall new deliveries / overall net absorption / overall vacancy rates $ psf $100 $90 $80 $70 $60 $50 $40 $30 $20 $10 $0 Class rental rate Class rental rate Q s.f. in millions New deliveries YTD Net absorption YTD Vacancy Class YTD Vacancy Class YTD Q % 12% 8% 4% 0% Significant lease transactions Mount Sinai Medical Center 150 E 42 nd Street New York & Company 330 W 34 th Street Publicis 1 Penn Plaza IM 590 Madison venue aron Capital 767 Fifth venue 448,819 s.f. 178,342 s.f. 113,945 s.f. 112,500 s.f. 107,000 s.f. Large availabilities 4 Times Square Class 817,252 s.f. 285 Madison venue Class 456,535 s.f roadway Class 415,467 s.f. 7 West 34 th Street Class 398,204 s.f. Recent sales transactions 10 Columbus Circle 1,100,000 s.f. 22 West 32 nd Street 113,000 s.f. 240 West 40 th Street 159,744 s.f. Class $1,182 / p.s.f. Class C $487 / p.s.f. Class $394 / p.s.f.

16 New York Midtown South Jones Lang LaSalle Office Outlook New York Q

17 Jones Lang LaSalle Office Outlook New York Q New York Midtown South boundaries Chelsea South of 29 th Street, west of Fifth venue, north of 14 th Street and east of the Hudson River. Hudson Square South of 14 th Street, west of venue of the mericas, north of Canal Street and east of the Hudson River. Gramercy Park South of 29 th Street, west of the East River, north of 14 th Street and east Fifth venue. SoHo South of Houston Street, west of the East River, north of Canal Street, and east of venue of the mericas. Greenwich Village North of Houston Street, south of 14 th Street, west of the East River and east of Sixth venue.

18 Jones Lang LaSalle Office Outlook New York Q Midtown South Quarter in review Midtown South s office market strengthened further in the first quarter of 2014 as large commitments primarily by creative companies boosted velocity, drove vacancy lower and spurred owners to raise rents to an all-time high. The number of large blocks of available office space those exceeding 100,000 square feet fell by half over the past year, from 10 to five. Six leases were signed in excess of 100,000 square feet compared to two in all of Overall average asking rents in Midtown South reached $58.23 per square foot, a record high and an increase of less than 1.0 percent from $57.88 per square foot at year-end Submarket boundaries map Credit Suisse Group G, one of the few financial services tenants in Midtown South, renewed 1.2 million square feet at 11 Madison venue for the largest lease of the quarter. New leases, however, continued to drive activity, accounting for 75.0 percent of the total volume from January to March. Renewals accounted for just 8.9 percent of activity. Creative industries represented the largest portion of leasing activity at 57.1 percent of all transactions completed, including impressive commitments such as Twitter s 144,000-square-foot relocation to 245 and 249 West 17th Street and IM s 118,425 square feet at the newly developed 51 stor Place, where it will keep its supercomputer Watson. Midtown South s overall vacancy rate fell to 7.0 percent this quarter, a decrease of 140 basis points from 8.4 percent at year-end bsorption in Midtown South was positive in the first quarter at 698,132 square feet as four of the five submarkets produced positive absorption. Despite this positive absorption, the Class vacancy rate rose 80 basis points from the fourth quarter last year to 6.9 percent, but is down 90 basis points from the first quarter of The rise in vacancy can be attributed to the addition of newly renovated space at 90 Fifth venue and 114 Fifth venue to the available supply. For the last three years, landlords have upgraded buildings to Class and then returned them to the market, causing the Class vacancy rate to occasionally move higher. While Midtown South s overall average asking rent reached an all-time, the relatively small Class market saw rents remain flat quarter-overquarter, as more expensive space at 51 stor Place was leased. With high rents and little available space, Midtown South tenants continued to migrate Downtown where Class rents are at a 20.0 percent discount. During the first quarter there were seven relocations from Midtown South to Downtown. Key market indicators Stock Overall net absorption 63,143,081 s.f. 698,132 s.f. Overall vacancy rate 7.0 % verage asking rent Under construction $58.23 p.s.f. 232,220 s.f. Market outlook Strong leasing activity should continue as two high profile tenants, Sony and Google, are expected to close large transactions by year end. Increasing consumer confidence which fuels demand for fashion and other retail offerings and rising high-tech employment should also bode well for Midtown South over the coming quarters. While available space is currently limited, a number of under construction and renovated properties are expected to come to the market over the next two years in Chelsea and the Meatpacking District. This will increase tenant options but will come at a cost: the newer space is expected to be priced near the top of the market. s typical for Midtown South, most of these projects are small in size.

19 Jones Lang LaSalle Office Outlook New York Q Midtown South verage rental rates (Class vs. Class ) Overall new deliveries / overall net absorption / overall vacancy rates $ psf $80 $70 $60 $50 Class rental rate Class rental rate s.f. in millions New deliveries YTD Vacancy Class YTD Net absorption YTD Vacancy Class YTD 12% 10% 8% 6% $ % $ % $ Q Q % Significant lease transactions Credit Suisse 11 Madison venue Twitter 245 and 249 West 17 th Street IM 51 stor Place WeWork 115 West 18 th Street 1,200,000 s.f. 144,000 s.f. 118,425 s.f. 115,400 s.f. Large availabilities 225 Park venue South Class 472,602 s.f. 11 Madison venue Class 213,285 s.f. 395 Hudson Street Class 160,000 s.f. 114 Fifth venue Class 135,282 s.f. Recent sales transactions 154 East 23 rd Street 16,000 s.f. 555 West 25 th Street 40,926 s.f. 229 West 28 th Street 153,913 s.f. Class $750 / p.s.f. Class $660 / p.s.f. Class $530 / p.s.f.

20 Jones Lang LaSalle Office Outlook New York Q ppendix New York appendix Statistics Contiguous space New construction and map Glossary

21 JLL New York Office Outlook Q ppendix New York Statistics YTD completion (sf) Inventory (sf) Direct net absorption (sf) YTD direct net absorption (sf) Total net absorption (sf) YTD total net absorption (sf) YTD total net absorption (% of stock) Direct vacancy (sf) Direct vacancy (%) Total vacancy (sf) Total vacancy (%) verage asking rent ($ psf) Under construction / renovation (sf) Downtown Class 0 66,006, , , , , % 9,058, % 9,789, % $ ,038,168 Class 0 34,650, , ,632 95,157 95, % 2,784, % 3,473, % $ Totals 0 100,657, , ,610-6,857-6, % 11,843, % 13,263, % $ ,038,168 Midtown Class 0 179,752, , , , , % 17,211, % 21,681, % $ ,173,672 Class 0 99,971, , , , , % 8,159, % 9,723, % $ Totals 0 279,723, , , , , % 25,370, % 31,405, % $ ,173,672 Midtown South Class 0 16,394, , , , , % 995, % 1,125, % $ ,220 Class 0 46,748, , , , , % 2,447, % 3,325, % $ Totals 0 63,143, , , , , % 3,443, % 4,451, % $ ,220 Market Totals Class 0 262,153, , , , , % 27,265, % 32,597, % $ ,444,060 Class 0 181,370, , , , , % 13,391, % 16,522, % $ Totals 0 443,523,324-96,398-96, , , % 40,657, % 49,120, % $ ,444,060

22 Downtown JLL New York Office Outlook Q ppendix YTD completion (sf) Inventory (sf) Direct net absorption (sf) YTD direct net absorption (sf) Total net absorption (sf) YTD total net absorption (sf) YTD total net absorption (% of stock) Direct vacancy (sf) Direct vacancy (%) Total vacancy (sf) Total vacancy (%) verage asking rent ($ psf) Under construction / renovation (sf) Financial District Class 0 21,472, , , , , % 1,473, % 1,824, % $ Class 0 17,856, , , , , % 2,159, % 2,510, % $ Totals 0 39,329,281-79,156-79,156 82,331 82, % 3,632, % 4,335, % $ Tribeca/City Hall Class 0 5,262,135 12,899 12,899 12,899 12, % 27, % 27, % $ Class 0 13,938,639 3,973 3,973-94,392-94, % 561, % 798, % $ Totals 0 19,200,774 16,872 16,872-81,493-81, % 588, % 826, % $ Water Street Corridor Class 0 20,767,054-40,650-40,650 27,545 27, % 2,851, % 3,230, % $ Class 0 2,854, ,857-4, % 63, % 163, % $ Totals 0 23,621,959-40,807-40,807 22,688 22, % 2,915, % 3,394, % $ World Trade Center Class 0 18,505,067-38,519-38,519-30,383-30, % 4,706, % 4,707, % $ ,038,168 Class % 0 0.0% 0 0.0% $ Totals 0 18,505,067-38,519-38,519-30,383-30, % 4,706, % 4,707, % $ ,038,168 Market Totals Class 0 66,006, , , , , % 9,058, % 9,789, % $ ,038,168 Class 0 34,650, , ,632 95,157 95, % 2,784, % 3,473, % $ Totals 0 100,657, , ,610-6,857-6, % 11,843, % 13,263, % $ ,038,168

23 Midtown JLL New York Office Outlook Q ppendix YTD completion (sf) Inventory (sf) Direct net absorption (sf) YTD direct net absorption (sf) Total net absorption (sf) YTD total net absorption (sf) YTD total net absorption (% of stock) Direct vacancy (sf) Direct vacancy (%) Total vacancy (sf) Total vacancy (%) verage asking rent ($ psf) Under construction / renovation (sf) Columbus Circle Class 0 16,926, , ,679-81,708-81, % 1,213, % 1,502, % $ Class 0 8,300,398-9,739-9,739-14,594-14, % 385, % 452, % $ Totals 0 25,227, , ,418-96,302-96, % 1,598, % 1,955, % $ Grand Central Class 0 36,546, , , , , % 4,687, % 5,530, % $ Class 0 34,420,521 20,155 20,155 28,078 28, % 2,914, % 3,537, % $ Totals 0 70,967, , , , , % 7,601, % 9,067, % $ Penn Plaza/Garment Class 0 12,204, , , , , % 507, % 865, % $ ,173,672 Class 0 31,827,761-6,564-6,564-36,710-36, % 3,247, % 3,799, % $ Totals 0 44,032, , , , , % 3,755, % 4,665, % $ ,173,672 Plaza District Class 0 83,271,198-87,020-87, , , % 7,852, % 10,101, % $ Class 0 17,304, , , , , % 1,139, % 1,315, % $ Totals 0 100,575,674 31,829 31,829 5,796 5, % 8,992, % 11,416, % $ Times Square Class 0 30,802, , , , , % 2,950, % 3,682, % $ Class 0 8,117,935 15,542 15, , , % 471, % 618, % $ Totals 0 38,920, , , , , % 3,422, % 4,301, % $ Market Totals Class 0 179,752, , , , , % 17,211, % 21,681, % $ ,173,672 Class 0 99,971, , , , , % 8,159, % 9,723, % $ Totals 0 279,723, , , , , % 25,370, % 31,405, % $ ,173,672

24 Midtown South JLL New York Office Outlook Q ppendix YTD completion (sf) Inventory (sf) Direct net absorption (sf) YTD direct net absorption (sf) Total net absorption (sf) YTD total net absorption (sf) YTD total net absorption (% of stock) Direct vacancy (sf) Direct vacancy (%) Total vacancy (sf) Total vacancy (%) verage asking rent ($ psf) Under construction / renovation (sf) Chelsea Class 0 5,455, , , , , % 379, % 425, % $ ,220 Class 0 15,860,557 84,269 84, , , % 694, % 962, % $ Totals 0 21,316, , , , , % 1,074, % 1,388, % $ ,220 Gramercy Park Class 0 6,689, ,325 6, % 332, % 401, % $ Class 0 14,987, , , , , % 998, % 1,246, % $ Totals 0 21,676, , , , , % 1,331, % 1,648, % $ Greenwich Village Class 0 1,652, , , , , % 116, % 126, % $ Class 0 4,193,806 63,483 63,483 78,353 78, % 139, % 170, % $ Totals 0 5,846, , , , , % 255, % 297, % $ Hudson Square Class 0 2,452,550 13,116 13,116 23,116 23, % 166, % 172, % $ Class 0 7,125,298 7,071 7,071 28,270 28, % 365, % 611, % $ Totals 0 9,577,848 20,187 20,187 51,386 51, % 532, % 783, % $ SoHo Class 0 144, % 0 0.0% 0 0.0% $ ,000 Class 0 4,581,666-70,781-70,781-75,620-75, % 249, % 333, % $ Totals 0 4,725,666-70,781-70,781-75,620-75, % 249, % 333, % $ ,000 Market Totals Class 0 16,394, , , , , % 995, % 1,125, % $ ,220 Class 0 46,748, , , , , % 2,447, % 3,325, % $ Totals 0 63,143, , , , , % 3,443, % 4,451, % $ ,220

25 Jones Lang LaSalle Office Outlook New York Q ppendix Midtown buildings with large contiguous blocks of space 48 locks 9,583,841 s.f. 4 Times Square 817,252 s.f. 285 Madison venue 456,535 s.f. 7 West 34 th Street 398,204 s.f. 685 Third venue 328,489 s.f venue of the mericas 303,112 s.f. 55 West 46 th Street 290,863 s.f venue of the mericas 285,872 s.f. 280 Park venue 248,872 s.f. 9 West 57 th Street 247,500 s.f venue of the mericas 241,440 s.f. 112 West 34 th Street 235,594 s.f. 237 Park venue 229,832 s.f. 450 West 33 rd Street 222,037 s.f. 250 West 55 th Street 216,555 s.f. 299 Park venue 206,493 s.f. 330 West 34 th Street 199,550 s.f. 622 Third venue 196,487 s.f. 280 Park venue 191,126 s.f. 335 Madison venue 190,824 s.f. 330 West 34 th Street 190,637 s.f. 475 Fifth venue 187,462 s.f. 11 Times Square 183,072 s.f venue of the mericas 180,689 s.f. 300 Park venue 174,384 s.f. 114 West 47 th Street 173,223 s.f venue of the mericas 169,753 s.f. 101 Park venue 169,750 s.f roadway 163,133 s.f. 350 Park venue 161,954 s.f venue of the mericas 155,894 s.f. 919 Third venue 152,935 s.f. 335 Madison venue 141,855 s.f. 450 West 33 rd Street 138,905 s.f. 885 Second venue 138,582 s.f roadway 135,753 s.f venue of the mericas 125,700 s.f. 9 West 57 th Street 122,700 s.f. 237 Park venue 121,812 s.f venue of the mericas 117,112 s.f. 31 West 52 nd Street 115,230 s.f. 10 East 53 rd Street 114,844 s.f. 10 East 53 rd Street 109,296 s.f. 666 Fifth venue 108,229 s.f venue of the mericas 106,500 s.f. 31 West 34 th Street 106,464 s.f. 350 Fifth venue 104,647 s.f. One Park venue 104,351 s.f. 825 Eighth venue 102,648 s.f. Contiguous blocks greater than 100,000 square feet

26 Jones Lang LaSalle Office Outlook New York Q ppendix Midtown South buildings with large contiguous blocks of space 5 locks: 1,094,587 s.f. 225 Park venue South 472,602 s.f. 11 Madison venue 213,285 s.f. 395 Hudson Street 160,000 s.f. 114 Fifth venue 135,282 s.f. 90 Fifth venue 113,418 s.f. Contiguous blocks greater than 100,000 square feet

27 Jones Lang LaSalle Office Outlook New York Q ppendix Downtown buildings with large contiguous blocks of space 17 locks: 6,674,117 s.f. Four World Trade Center 1,034,969 s.f. One World Trade Center 776,512 s.f. 180 Maiden Lane 713,903 s.f. 225 Liberty Street 704,967 s.f. 225 Liberty Street 603,290 s.f. 195 roadway 488,966 s.f. 85 road Street 481,616 s.f. 1 New York Plaza 273,300 s.f. One World Trade Center 258,135 s.f. 1 Liberty Plaza 242,356 s.f. 250 Vesey Street 196,219 s.f. 123 William Street 179,523 s.f. 40 Rector Street 172,605 s.f. 250 Vesey 147,736 s.f. One World Trade Center - 140,316 s.f. 86 Trinity Place-130,240 s.f. 26 roadway 129,464 s.f. Contiguous blocks greater than 100,000 square feet

28 Jones Lang LaSalle Office Outlook New York Q ppendix Market CD under construction Market/building Class Developer/owner R Pre-leased Major tenants signed Net rent Delivery date CD Downtown One World Trade Center Port uthority of NY & NJ/ Durst 3,038,168 s.f. 55.9% Condé Nast, China Center, GS N/ 2014 Midtown 10 Hudson Yards Related Companies 1,700,000 s.f. 77.3% Coach, L Oreal, SP N/ ryant Park Hines/Pacolet Miliken 473,672 s.f. 0.0% N/ N/ 2015 Midtown South 837 Washington Taconic Investment Partners/Thor Equities 27,000 s.f. 0.0% N/ N/ West 22 nd Street lbanese Organization 168,220 s.f. 0.0% N/ N/ roadway 37,000 s.f. 0.0% N/ N/ 2014 CD totals 5,440,060 s.f. 55.3%

29 Jones Lang LaSalle Office Outlook New York Q ppendix Manhattan CD select sales Midtown 10 Columbus Circle Midtown South 555 roadway Class Class R 1,100,000 s.f. R 216,000 s.f. uyer Related Companies uyer Scholastic Seller Time Warner Seller ISE merica Price per s.f. $1,182 Price per s.f. $1,182 PSF Date sold January 2014 Date sold March 2014 Midtown 17 East 47 th Street Midtown South 555 West 25 th Street Class Class R 18,200 s.f. R 40,926 s.f. uyer Suns cres uyer Mark Sonnino Seller Center for Fiction Seller Flat Rate Moving Company Price per s.f. $989 Date sold February 2014 Price per s.f. $668 Date sold March 2014

30 Glossary Jones Lang LaSalle Office Outlook New York Q ppendix

31 Jones Lang LaSalle Office Outlook New York Q ppendix Common real estate terms ctive requirements: Tenants actively seeking space in the market verage asking rent: Quoted at a gross price exclusive of tenant electricity based on a weighted average of available space vailable space: Existing space that is being actively marketed for immediate or future occupancy, including both direct and sublease space uild-out: The cost of configuring and finishing new space in accordance with a tenant s specifications uild to suit: method of leasing property whereby the landlord builds a new building in accordance with a tenant s specifications Capital improvement: ny major physical development or redevelopment to a property that extends the life of the property. Examples include upgrading the elevators, replacement of the roof and renovations of the lobby Class: uilding classification system broken down by Trophy, Class, and C buildings. Location, building amenities, mechanical / HVC systems, age of building and tenant roster are some of the components that determine an office building's class Concessions: Cash expended by the landlord in the form of rent abatement, build-out allowance or other payments to induce the tenant to sign a lease. The level of concessions fluctuates with supply and demand conditions in the market and is up for negotiation in a similar fashion to rental rates Contiguous space: djoining office space Delivered buildings: uildings that have completed construction and are ready for tenant build-out. May or may not yet have a Certificate of Occupancy Direct rent: Rents quoted directly from the landlord on vacant space Effective rent: The rental rate actually achieved by the landlord or tenant after deducting the value of concessions from the base rental rate paid; usually expressed as an average rate over the term of the lease Face rental rate: The asking or nominal rental rate published by the landlord Gross leases: The quoted rents include tax and operating costs (property taxes, insurance and maintenance expenses) Hard cost: The cost of actually constructing property improvements Indirect (soft) costs: Development costs other than material and labor costs, which are directly related to the construction of improvements, including administrative and office expenses, commissions, architectural, engineering and financing costs Lease: legally binding agreement whereby the owner of real property (i.e., landlord) gives the right of possession to another (i.e., tenant) for a specified period of time (i.e., term) and for a specified consideration (i.e., rent) Leased space: Existing space under contract, regardless of if it is occupied; also includes subleased space NNN leases: The quoted rents do not include tax and operating costs (property taxes, insurance and maintenance expenses) Net absorption: Net change in occupied space between two dates measured as square footage. (i.e. a measure of the total square feet leased over a period of time taking into consideration office space vacated in the same area during the same period) Occupied space: Total supply minus available space Operating expense: The actual costs associated with operating a property, including maintenance, repairs, management, utilities, taxes and insurance Preleased space: Space that has been leased prior to construction completion date or Certificate of Occupancy date

32 Jones Lang LaSalle Office Outlook New York Q ppendix Proposed construction: uildings are proposed when permits are in place, site is being actively marketed but significant base building has not yet commenced. Proposed asking rents are not included in market calculations Shell space: The interior condition of the tenant's usable square footage when it is without improvements or finishes. Shell construction typically denotes the floor, windows, walls and roof of an enclosed premises and may include some HVC, electrical or plumbing improvements but not demising walls or interior space partitioning Sublease space: Leased space that is being actively marketed by the tenant under contract to another party Tenant at will: One who holds possession of premises by permission of the owner or landlord, but without agreement for a fixed term Tenant improvement allowance (TI): Improvements to land or buildings to meet the needs of tenants. May be new improvements or remodeling, and may be paid for by the landlord, the tenant, or shared Total supply: The entire area of an office building comprised of both usable space and an allocated portion of the common area Turn key project: project in which the developer is responsible for the total completion of a building (including interior design and construction) or demised premises to the customized requirements of a future owner or tenant Under construction: uildings are under construction when significant work is underway from ground up development (i.e. steel is going up) Under renovation / rehab: uildings are under renovation / rehab when significant base building renovation is underway Vacant space: Direct existing space being actively marketed for immediate occupancy as of the survey date, not including sublease space

33 bout JLL JLL (NYSE:JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $4 billion, JLL operates in 75 countries worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3 billion square feet and completed $99 billion in sales, acquisitions and finance transactions in Its investment management business, LaSalle Investment Management, has $47.6 billion of real estate assets under management. For further information, visit bout JLL Research JLL s research team delivers intelligence, analysis, and insight through market-leading reports and services that illuminate today s commercial real estate dynamics and identify tomorrow s challenges and opportunities. Our 300 professional researchers track and analyze economic and property trends and forecast future conditions in over 70 countries, producing unrivalled local and global perspectives. Our research and expertise, fueled by realtime information and innovative thinking around the world, creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions. New York Headquarters Corporate Office 330 Madison venue New York, NY tel fax Downtown Office 140 roadway 26 th Floor New York, NY tel Jones Lang LaSalle IP, Inc. ll rights reserved. No part of this publication may be reproduced by any means, whether graphically, electronically, mechanically or otherwise howsoever, including without limitation photocopying and recording on magnetic tape, or included in any information store and/or retrieval system without prior written permission of Jones Lang LaSalle. The information contained in this document has been compiled from sources believed to be reliable. Jones Lang LaSalle or any of their affiliates accept no liability or responsibility for the accuracy or completeness of the information contained herein and no reliance should be placed on the information contained in this document.