Metropolitan Chicago Market Review. Office Market Review Second Quarter 2015

Transcription

1 Metropolitan Chicago Market Review Office Market Review Second Quarter 215

2 To our valued customers, partners and future clients Leaving an Open House last week, I was greeted with the blast-furnace sensation familiar to anyone who has opened their car door on a blistering July day in Chicago. That experience was followed closely thereafter by inadvertently touching my white-hot metal seatbelt, then wishing I had oven mitts to handle the steering wheel. Living in the midwest, you quickly learn that the stated temperature is only loosely related to the actual feeling outside. In the winter, the Chicago wind conspires with the temperature to give us the frigid subzero wind chill we actually feel. During the summer months, the heat index takes into account the sticky humidity to approximate what it really feels like to be outside. I ve heard meteorologists call these factors the TrueTemp or Real Feel. The charts, statistics and analysis on the following pages tell the story of continued improvement in the Chicagoland office and industrial real estate markets. The Real Feel, however, is evident when I look at my calendar and see the number of meetings, industry events, networking parties and groundbreakings filling up the days and nights. Which fuels our reality - the actual temperature (the statistics) or the heat index (the more abstract feel of the business climate)? There is broad consensus that the underlying fundamentals and optimistic outlook in Chicago are in sync right now. The return of optimism over the past few years is fostering boldness and excitement, and that attitude is reflected in the robust sales, leasing and construction activity seen in both in the suburban and downtown markets. In June, NAI Hiffman hosted the NAI Global Market Outlook featuring commentary by Sam Zell and economist Peter Linneman. In preparation for the event, several ownership groups agreed to speak on video about their successes and why they like to do business in Chicago. (You can see the result at our YouTube Channel - It is encouraging to hear these organizations reflect the forward momentum and optimism we ve all been feeling. It s an exciting time, and we look forward to working with you in the coming months to make your real estate strategies a reality. Regards, John R Picchiotti COO, Brokerage

3 Table of Contents NAI Hiffman Metropolitan Chicago Office Market Review Second Quarter Local Economy 7 Office Statistics 8 Suburban Office Summary 1 North Suburban 12 Northwest Suburban 14 O Hare Area 16 East-West Corridor 18 I-55 Corridor 2 Downtown Office Summary 22 West Loop 24 Central Loop 26 East Loop 28 North Michigan Avenue 3 River North 32 Methodology/NAI Global 34 NAI Hiffman

4 Overall Trend Local Economy Unemployment POPULATION (214 CENSUS) 9,537, % POPULATION CHANGE (2-214) +4.8% MEDIAN HOUSEHOLD INCOME (213) $51,25 GROSS METRO PRODUCT (214) $59.4 BILLION Case-Shiller Home Price Index EMPLOYMENT - NONFARM (Q2 215) JOBS GAINED (Q3 213-Q3 214) CHICAGO METRO UNEMPLOYMENT RATE ILLINOIS UNEMPLOYMENT RATE U.S. UNEMPLOYMENT RATE 5,92,2 43,2 5.8% 6.4% 5.3% Q1 215 US GDP Change.2% With a metropolitan population of nearly 1 million, Chicago is the third largest MSA in the U.S. after New York and Los Angeles and is the most influential economic region between the East and West Coasts. Foreign Policy Magazine recently ranked Chicago sixth among world competition, measuring econometrics from the number of Fortune 5 companies to the flow of goods and services through airports, rail, roads and ports. Situated at the geographical heart of the nation, Chicago s locational advantages have fostered its development into an international center for transportation, manufacturing, banking, securities, technology, services, wholesale and retail trade. In addition, Chicago is one of the principal trading centers for commodities, financial futures and derivative products with the Chicago Mercantile Exchange and Board of Trade. O Hare International still ranks as one of the busiest airports in the world with numerous non-stop flights to leading international business centers in Europe, Asia and the Middle East. Quarter in Review Real domestic product (GDP) decreased.2%, according to the third estimate released by the Bureau of Economic Analysis. In comparison, GDP increased 2.2 percent in the fourth quarter of 214. The first quarter decline is seen in declines in exports of goods, business investments and state and local government spending. Helping to offset the decline in GDP, consumer spending on services rose, particularly on healthcare and on housing and utilities. The nation s total GDP, in excess of $17 trillion, remains the world s largest, comprising 28% of the global total. With a population of 32 million, the U.S. is the world s third most populous country behind China and India. The U.S. has emerged as the world s largest energy producer, surpassing Saudi Arabia in oil and Russia in natural gas production, largely due to hydraulic fracturing technology. World oil prices have declined over 5% from $18 a barrel in January 214 to $6 in June 215, providing a $34 billion U.S. Dollar Index US GDP Change by Quarter 1 6% 9 4% 4.6% 5.% 8 2% % 1.5% -.2% 7-2% -2.1% % Q1 214 Q2 214 Q3 214 Q4 214 Q NAI Hiffman U.S. Dollar U.S. Recession Period Source: Federal Reserve Bank of St. Louis 215 IMF Projection GDP Growth (%) Source: Federal Reserve Bank of St. Louis

5 annual stimulus to the domestic economy. The U.S. Dollar strengthened against most major currencies gaining 19% on average since January 214. The relative strength of the Dollar raises concerns that domestic manufactures will be disadvantaged in global markets and pressured by currency advantaged imports. The increase in the Dollar has partially contributed to the 5% increase in the U.S. trade deficit in goods and services now exceeding $5 billion annually. Interest rates and inflation remain near historic lows at an average of 2.3% and 1.5 %, respectively. The S&P 5 stock index reached an all-time high surpassed the 21 level in March 214 and continues to perform in that range. The NASDAQ Composite reached the 5 level the first time since March 2. The housing market continues to recover albiet slow momentum. The West and Northeast region of the country have generally recovered at a stronger pace. The Midwest and South Region has lagged behind. The Case-Shiller 1 Cities Composite Home Price Index has increased 3% from April 212 lows and the Case-Shiller Index for Chicago has increased 2%. U.S. Housing starts continue to slowly recover but remain 5% below the 3 year annual average of 1.5 million units. Eventually U.S. housing starts will increase to higher levels which will enhance GDP growth. Crude Oil Prices Local Economy $16 $12 $8 $ Dollars per Barrel Source: Federal Reserve Bank of St. Louis S&P 5 Index 2,5 2, Employment continues to expand, with companies adding approximately over 2, per month, with over 28, jobs during the month of May. This represents the longest stretch of job creation the country has seen in 15 years. The unemployment rate declined to 5.3% in June 215 with the level of Americans filing for unemployment reaching the lowest level since 2. While the unemployment rate has significantly declined, so has the overall labor participation rate, indicating that many have dropped out of the labor market altogether. Federal, State and Local budget deficits, while improving, still remain dauntingly large. High corporate taxes continue to be a concern, causing some corporations to consider a move overseas. Governmental debt and tax reform will remain significant topics throughout the next election cycle which begins soon. 1,5 1, S&P/Case-Schiller Home Price Index Source: Federal Reserve Bank of St. Louis Looking Forward Positive indicators have outweighed the negative over the past 12 months with the U.S. economy achieving better results than generally predicted. The IMF is forecasting 3.6% U.S. GDP growth in 215, which if achieved, would be the highest annual increase since 24. Corporate profits have reached new records enabling U.S. businesses to invest in productivity enhancements and market share growth. Barring any significant negative geopolitical events in 215, the U.S. seems poised to continue to benefit from better than average economic performance relative to most other major world economies Chicago Home Price Index 1-City Composite Home Price Index Source: Federal Reserve Bank of St. Louis 5

6 Kenosha Regional Airport Chicago Office Markets Office Market Overviews North Suburban Waukegan Regional Airport Fox Lake Northwest Suburban O Hare Area Gurnee East-West Corridor Waukegan I-55 Corridor Grayslake McHenry West Loop Central Loop East Loop Libertyville North Lake Forest Suburban Crystal Lake North Michigan Avenue Vernon Hills River North Lake Zurich Highland Park Buffalo Grove Northwest Suburban Arlington Heights 9 Elgin Northbrook Chicago Executive Airport 2 Glenview Evanston Schaumburg Niles O Hare Area South Elgin Ohare Int'l Airport CBD (Central Business District) 171 Lombard Ohio 43 St 12 Grove I-55Darien Corridor Bolingbrook 83 Burr Ridge Oak Lawn Chicago Midway 5 Airport North 12 Michigan 2 Avenue Wacker Dr East Loop Randolph St Carpenter St Aurora Naperville River North 2 55 Kinzie St 9 41 Chicago Ave 29 East-West 2 Corridor Downers Westmont West Loop Central Loop Harvey Congress Pky 57 Michigan Ave Carol Stream 88 Chicago Midway Airport Chicago Oak St Michigan Ave Franklin Park State St Addison 29 Wacker Dr Dupage St CharlesAirport North Aurora Skokie Wells St Dundee Deerfield Halsted St Romeoville 55 6 NAI Hiffman Gary/Chicago Airport 8

7 Second Quarter 215 Office Market Statistics Market/ # Bldgs. Total RBA Direct Sublease Total Total Q2 215 Net Total 215 Q2 215 Under Submarket (SF) Vacancy Vacancy Vacancy Available Absorption (SF) Absorption (SF) Constr. (SF) North Suburban Class A Class B Class C Northwest Suburban Class A Class B Class C O Hare Area Class A Class B Class C East-West Corridor Class A Class B Class C I-55 Corridor Class A Class B Class C Suburban Totals Class A Class B Class C , , ,321,585 17,318,27 1,85,362 2,917,953 33,762,617 16,65,4 14,96,648 3,15,25 15,263,39 8,296,341 5,964, 1,2,64 43,32,999 21,192,182 16,844,42 4,996,775 4,19, ,578 2,685, ,73 126,399,495 64,156,315 49,676,12 12,567, % 13.18% 17.46% 13.24% 19.8% 14.92% 23.56% 21.15% 17.14% 13.8% 22.79% 17.21% 17.38% 14.15% 22.28% 14.52% 12.17% 5.1% 15.4% 6.37% 16.97% 13.85% 21.35% 15.62%.73% 1.12%.2%.22% 1.4% 1.68% 1.31%.32%.6%.91%.18%.43% 2.18% 2.21% 2.75%.15%.99%.% 1.48%.% 1.4% 1.59% 1.45%.22% 15.34% 14.3% 17.66% 13.47% 2.48% 16.59% 24.87% 21.47% 17.74% 13.99% 22.97% 17.64% 19.56% 16.36% 25.3% 14.67% 13.16% 5.1% 16.89% 6.37% 18.37% 15.43% 22.8% 15.84% 21.2% 22.98% 18.84% 16.93% 26.23% 25.51% 27.75% 23.7% 22.37% 19.36% 26.98% 2.16% 25.2% 25.61% 27.7% 17.12% 18.33% 15.36% 21.2% 1.22% 23.91% 23.95% 25.25% 18.4% -51,621-29,27-26,227 3,633-2,54-199,427 5,92-6,979 33,187 17,57-47,373-27,7 31,693 57,599-5,648-2,258-42,76-49,345 6,585-23,5-63, ,691-43, , ,82-2,83 1,585-69,146-66,818-3,444 1,116-19,3-31,261-62,653-15,89-14,463-1,776-6,252-6,435-65,965-75,654 9,689 13,7 298,7-168, ,3 753,3 131, , , ,628 West Loop Class A Class B Class C Central Loop Class A Class B Class C East Loop Class A Class B Class C North Michigan Ave. Class A Class B Class C River North Class A Class B Class C Downtown Totals Class A Class B Class C Metro Chicago Totals Class A Class B Class C , , ,377,793 3,193,318 11,212,82 3,971,673 38,559,342 19,661,779 15,5,58 3,396,983 23,45,26 1,864,735 7,349,927 5,19,598 13,141,925 6,22,259 6,131,682 87,984 13,53,272 4,88,938 5,798,248 3,643,86 134,14,592 71,11,29 45,993,239 17,1,324 26,414,87 134,93,344 95,669,359 29,577, % 1.46% 5.78% 5.88% 9.59% 8.4% 9.25% 2.15% 15.4% 15.26% 17.79% 12.29% 14.62% 16.87% 12.59% 12.73% 9.76% 5.23% 13.46% 8.% 1.97% 1.78% 1.99% 11.67% 13.88% 12.24% 16.37% 13.34%.88%.7% 1.54%.41%.81%.%.81%.5%.83% 1.23%.22%.83%.91% 1.38%.54%.8% 1.16%.34% 2.2%.7%.88%.89% 1.1%.51% 1.13% 1.22% 1.24%.39% 1.4% 11.16% 8.33% 6.28% 1.41% 8.99% 1.6% 2.2% 16.22% 16.49% 18.2% 13.12% 15.52% 18.25% 13.12% 12.81% 1.91% 5.56% 15.48% 9.64% 11.85% 11.67% 12.% 12.18% 15.1% 13.46% 17.61% 13.73% 19.71% 2.92% 2.61% 7.96% 18.97% 19.71% 16.67% 25.12% 21.41% 21.91% 24.7% 16.7% 23.17% 25.12% 22.9% 15.49% 15.42% 1.19% 2.48% 13.25% 19.7% 2.49% 2.1% 15.55% 21.74% 22.13% 22.73% 16.76% 44,563-82, ,787-87, ,89 83, ,298 1,264 57,65-29,81 56,518 3,888-54,421-66,582 24,12-11,851-59,58 11,721 7,84-78, ,256-83, , ,55 84, , ,8-181,21-117, , ,855-14, ,4 213,97 213,354 38,76 26,488-13,261 61,767-22,18-44,73-9,869 49,782-3,643-25,56 9, ,16-87, ,577-79, ,598-18,12 58, ,28 432,59-143,276 2,564,446 2,564,446 2,564,446 2,564,446 3,449,74 3,449,74 7

8 Overall Trend Suburban Office Market # OFFICE BUILDINGS 2,32 MARKET SIZE (SF) 126,399, % TOTAL VACANCY 23,219,898 SF (18.37%) DIRECT VACANCY 21,455,97 SF (16.97%) SUBLEASE VACANCY 1,764,81 SF (1.4%) AVAILABLE SPACE 3,225,21 SF (23.91%) Net Absorption -23,5 SF Q2 215 NET ABSORPTION (SF) -23,5 YTD 215 NET ABSORPTION (SF) 13,7 UNDER CONSTRUCTION (SF) 884,628 Asking Rents Q2 215 NEW SUPPLY (SF) Pictured above: 5 Lake Cook Rd, one building of the 4-building Corporate 5 office complex acquired by Cornerstone RE Advisers during the second quarter Comprised of several dispersed pockets of office developments, corporate parks and high-rise office towers, the suburban office market has experienced historically higher vacancy rates, larger swings in absorption, and lower rents than Chicago s downtown office market. The 15 largest suburban office complexes each total at least 1.1 million SF, which is about the average size of an office tower in the Central Business District. Quarter in Review The Chicago suburban office market fundamentals showed improvement year-to-date, despite a flat performance during the second quarter. Year-to-date absorption remains positive at 13, SF despite quarterly negative net absorption of 23, SF. Contributing to the decrease in occupied space was large suburban tenant, Gogo, who vacated the suburbs, moving to the CBD. The Chicago suburban office vacancy rate increased just 18 basis points from the previous quarter to the second quarter rate of 18.37%. Class "A" space in the suburbs remains in strong demand with nearly 3, SF of positive net absorption year-to-date, shrinking the vacancy rate to 15.43% for this product. Sizable lease renewals and new lease commitments secured second quarter should have a positive impact on the suburban office market in future quarters. During the second quarter, increased suburban office sales activity transferred ownership on a number of assets. One of the largest transactions was Columbia Property Trust's disposition of its national 11-building portfolio, which resulted in Lone Star Fund's acquisition of six Chicago suburban assets. Lone Star also acquired two assets from Equity Commonwealth. Suburban Vacancy Absorption Suburban Direct & Overall Vacancy 9, 24% 3, -3, 22% 2% 15.34% 14.61% 2.48% 19.8% 17.74% 17.14% 19.56% 17.38% 13.16% 18.37% 16.97% 12.17% -9, 18% -15, % (%) Net Absorption (SF) North Suburban Northwest Suburban O Hare Area East-West Corridor I-55 Corridor Overall Suburban 8 NAI Hiffman Direct Vacancy Sublease Vacancy

9 Suburban Office Market Looking Forward Investors are clearly setting their sights on the Chicago suburban office market with increasing investment sales activity. Shortly after the second quarter ended, Blackstone Group closed on the GE Capital national real estate portfolio which totaled 85 properties. Locally, Blackstone acquired assets, including several notable suburban assets: Oakbrook Terrace Tower, the tallest office building in the suburban market as well as Westbrook Corporate Center, a five-building office complex totaling nearly 1.1 million SF. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Innovation Park Lake County 6 N US Highway 45, Libertyville 972,531 Zurich Towers I 14 American Ln, Schaumburg 441,531 1 Zurich Towers II 145 American Ln, Schaumburg 44,538 1 AON Office Building (SL) 1 Milwaukee Ave, Glenview 45,39 Shuman Boulevard Shuman Blvd, Naperville 354, Oakmont Centre 7 Oakmont Ln, Westmont 256, Winfield Rd, Warrenville 249,996 Lucent Technologies 26 Lucent Ln, Naperville 225, (SL) All or partially a sublease listing 1 available late 217 Suburban Office Significant Buildings On the Market 2nd Quarter 215 Market Building Address Size (SF) Target Price Price PSF Seller Status North Suburban Illinois Science & Technology Park, 491 Searle Pkwy, Skokie 75, $7,, $93 Forest City Marketing Northwest Suburban Atrium Corporate Center 38 Golf Rd, Rolling Meadows 483, $77,, $159 Spear Street Marketing O'Hare 625 N River Rd, Rosemont 38,36 $79,, $28 CBRE Global Investors Marketing East-West Corridor Highland Pointe I and II, 333 and 377 E Butterfield Rd, Lombard 367,18 $47,724, $13 LaSalle Investment Marketing Suburban Office Significant Sale Transactions 2nd Quarter 215 Market Building Address Size (SF) Sale Price Price PSF Buyer Seller North Suburban Corporate 5 (4 bldgs), Lake Cook Rd, Deerfield 697,673 $153,8, $22 Cornerstone RE Advisers GE Capital RE East-West Corridor 3333 Finley Rd & 151 Opus Pl, Downers Grove 1 321,852 $38,75,153 $12 1 Lone Star Funds Columbia Property Trust East-West Corridor 31 Highland Pky, Downers Grove 1 275,197 $33,,534 $12 1 Lone Star Funds Columbia Property Trust East-West Corridor 265 Warrenville Rd, Downers Grove 1 222, $26,697,19 $12 1 Lone Star Funds Columbia Property Trust East-West Corridor 215 W Diehl Rd, Naperville 1 161,865 $26,697,19 $12 1 Lone Star Funds Columbia Property Trust North Suburban 544 Lakeview Pky, Vernon Hills 1 145, $26,25,269 $179 1 Lone Star Funds Columbia Property Trust North Suburban 1717 Deerfield Rd, Deerfield 137, $11,91,2 $8 Lone Star Funds Equity Commonwealth North Suburban 2355 Waukegan Rd, Bannockburn 1 16,495 $19,114,214 $179 1 Lone Star Funds Columbia Property Trust Suburban Office Significant Lease Transactions 2nd Quarter 215 Market Property Address Leased (SF) Tenant Lease Type Northwest Suburban 171 W Golf Rd, Rolling Meadows 16, Verizon New lease Northwest Suburban 15 McConnor Pky, Schaumburg 72,513 Comcast Corporation Lease renewal East-West Corridor 814 Commerce Dr, Oak Brook 45,756 Inland Real Estate Corporation New lease East-West Corridor 6-68 Oakmont Ln, Westmont 34,7 Athletico New lease East-West Corridor 1 Parkview Plz, Oakbrook Terrace 3, Kellen Association Management New lease East-West Corridor 325 Highland Pky, Downers Grove 29, Microsoft Lease renewal I-55 Corridor 18 Harvester Dr, Burr Ridge 27,789 Univ of Chicago Physicians Group New lease East-West Corridor 7 E Butterfield Rd, Lombard 26,278 MOL (America), Inc Lease renewal 1 Columbia Property Trust sold 11 suburban office properties totaling 2.9 million SF nationally and a six-buillding portfolio in the Chicago suburban market, acquired by Lone Star Funds; $ PSF figure represents allocation per Real Capital Analytics Entries highlighted in red denote NAI Hiffman transactions 9

10 173 North Suburban Waukegan Regional Airport # OFFICE BUILDINGS 524 Fox Lake 83 Gurnee Waukegan MARKET SIZE (SF) 3,321,585 Grayslake 12 TOTAL VACANCY 4,649,89 SF (15.34%) 21 DIRECT VACANCY 4,429,586 SF (14.61%) SUBLEASE VACANCY 22,34 SF (.73%) AVAILABLE SPACE 6,373,772 SF (21.2%) Vernon Hills Libertyville Lake Forest Q2 215 NET ABSORPTION (SF) -51,621 Lake Zurich TOTAL 215 NET ABSORPTION (SF) 388,584 Buffalo Grove Highland Park UNDER CONSTRUCTION (SF) 21 Deerfield 68 Q2 215 NEW SUPPLY (SF) Chicago Executive Airport Northbrook Net Absorption Asking Rents 9 Schaumburg Arlington Heights 2 Glenview 43 Niles Skokie Evanston 15.34% -51,621 SF Ohare Int'l Airport The North Suburban market is diverse in industry, but best known as a headquarters solution to many of Chicagoland s largest employers. With an unparalleled, qualified workforce, the north suburbs also lay claim to Chicago s popular North Shore communities where many of the area s chief executives and advisors choose to reside. In previous years, the market had fallen victim to large reductions in size from companies such as Allstate and Hewitt Associates, but the market has bounced back in large part due to pharmaceutical-related staples including Walgreens, Baxter, Abbott Laboratories, and related spin-offs, among others. Vacancy Absorption Inventory by City 6, 25% Deerfield (14%) 4, 22% Other Suburbs (27%) 2, 19% Northbrook (12%) 16% Vernon Hills (5%) Skokie (1%) -2, 13% Glenview (5%) -4, 1% (%) Net Absorption (SF) Buffalo Grove (5%) Bannockburn (5%) Evanston (8%) Lincolnshire (9%) 1 NAI Hiffman The net result for year-to-date absorption is 389, SF, the highest year-to-date total of all the suburban office markets.

11 North Suburban Quarter in Review The second quarter was relatively flat in the North Suburban submarket, compared to the record breaking results posted first quarter. The net result for year-to-date absorption was nearly 389, SF, the highest year-to-date absorption total of all the Chicago suburban submarkets. Nominal second quarter absorption of negative 52, SF increased the vacancy rate slightly to 15.34%, up 17 basis points from the previous quarter, yet well below the 16.7% vacancy rate recorded one year ago. Investment sales totaled over 1 million SF during the quarter in this submarket. The largest property sold was Corporate 5, a four-building complex totaling 7, SF, acquired by Cornerstone. Additionally, Lone Star Funds closed on four office buildings, acquiring two properties from Columbia Property Trust and two buildings from Equity Commonwealth, now owning nearly 45, SF in the North Suburban office market. One large lease renewal was announced during the quarter by United Stationers at One Parkway North for 198, SF. The transaction reportedly included ownership's commitment to improving the overall building amenities package to secure the lease renewal. Looking Forward Shortly after the second quarter ended, Blackstone Group closed on the GE Capital national real estate portfolio which totaled 85 properties. This sale added two North Suburban office assets to Blackstone's growing portfolio. With the sustained improving market fundamentals, it's anticipated that more landlords will consider capital improvement projects to enhance building leasability. As available space continues to lease up, landlords will seek ways to improve competitiveness and successfully position themselves to maintain and increase occupancy. One such example of this is Edens Corporate Center in Northbrook. The landlord constructed a new contemporary cafe concept and enhanced with a new operator, as well as modernized the building's conference room and training amenities which helped boost occupancy up to 92%. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Innovation Park Lake County 6 N US Highway 45, Libertyville 972,531 AON Office Building (SL) 1 Milwaukee Ave, Glenview 45,39 Woodland Falls Corporate Center N Riverwoods Blvd, Mettawa 159,821 Landmark of Lake Forest II (SL) 15 S Saunders Rd, Lake Forest 143,161 Bannockburn Corporate Center 3 Lakeside Dr, Bannockburn 111,141 One Overlook Point 1 Overlook Pt, Lincolnshire 17,984 Bannockburn Lake Office Plaza 2355 Waukegan Rd, Bannockburn 16,495 (SL) All or partially a sublease listing Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant North Suburban Sale Transactions 2nd Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller Corporate 5 5, 51, 52, 54 Lake Cook Rd, Deerfield 697,673 $153,8, $22 Cornerstone RE Advisers GE Capital RE 544 Lakeview Pky, Vernon Hills 1 145, $26,25,269 $179 1 Lone Star Funds Columbia Property Trust 1717 Deerfield Rd, Deerfield 137, $11,91,2 $8 Lone Star Funds Equity Commonwealth Bannockburn Lake 2355 Waukegan Rd, Bannockburn 1 16,495 $19,114,214 $179 1 Lone Star Funds Columbia Property Trust 1955 W Field Ct, Lake Forest 59,1 $3,7, $63 Lone Star Funds Equity Commonwealth Significant North Suburban Lease Transactions 2nd Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type One Parkway North 1 Parkway Blvd N, Deerfield 198, United Stationers Lease renewal 11 W Lake Cook Rd, Buffalo Grove 28,673 Ceannate Corporation New lease Deerbrook Corporate Center 57 Lake Cook Rd, Deerfield 15,997 Vail Systems, Inc Lease renewal 1 Columbia Property Trust sold 11 suburban office properties totaling 2.9 million SF nationally and a six-buillding portfolio in the Chicago suburban market, acquired by Lone Star Funds; $ PSF figure represents allocation per Real Capital Analytics Entries highlighted in red denote NAI Hiffman transactions 11

12 173 Northwest Suburban # OFFICE BUILDINGS 585 MARKET SIZE (SF) 33,762,617 McHenry 14 Fox Lake Waukegan Regional Airport Waukegan TOTAL VACANCY 6,916,99 SF (2.48%) 176 Libertyville DIRECT VACANCY 6,442,13 SF (19.8%) SUBLEASE VACANCY 473,969 SF (1.4%) AVAILABLE SPACE 8,854,768 SF (26.23%) Q2 215 NET ABSORPTION (SF) -2,54 TOTAL 215 NET ABSORPTION (SF) -69,146 UNDER CONSTRUCTION (SF) 753,3 Q2 215 NEW SUPPLY (SF) Net Absorption Asking Rents 2.48% -2,54 SF Crystal Lake Dundee Elgin 72 2 South Elgin Dupage Airport St Charles 59 Hoffman Estates 62 Hanover Park Lake Zurich Palatine Schaumburg Bloomingdale Wood Dale 2 29 Addison 355 Chicago Executive Airport Arlington Heights Elk Grove Village Buffalo Grove Lake Fores 2 Highla Northbroo Ohare Rosemont Int'l Airport Franklin Park Lombard The Northwest Suburban market is highly influenced by activity in the Schaumburg Area submarket, which includes the municipalities of Schaumburg, Hoffman Estates, Rolling Meadows, Arlington Heights and Palatine (65% of total market inventory). Recently, big companies such as Houghton Mifflin and Capital One have leased significant space in the submarket. The vacancy rate in the Northwest Suburban market increased dramatically in 29 and 21 to more than 27%, but has since dropped nearly 7% due to more than 1.9 million SF of net absorption over the past three years. Vacancy Absorption Inventory by City 6, 4, 28% 26% Other Suburbs (22%) Schaumburg (29%) 2, 24% 22% Long Grove (4%) Elgin (7%) -2, 2% Arlington Heights (1%) -4, 18% (%) Net Absorption (SF) Hoffman Estates (8%) Rolling Meadows (1%) Itasca (1%) 12 NAI Hiffman The new interchange at Meacham Rd and I-9 enhances the long-term development potential in this area.

13 Northwest Suburban Quarter in Review The Northwest Suburban submarket's second quarter market fundamentals were largely impacted by a sizable tenant leaving the submarket. Gogo, an in-flight wireless service provider, vacated over 1, SF in Itasca and more than doubled its space requirement upon its relocation to the West Loop submarket in the CBD. This departure contributed to second quarter negative absorption of 2, SF, pushing the vacancy rate up 5 basis points from the previous quarter to 2.48%. Despite the quarterly uptick in vacancy, the current vacancy is still well below the peak rate of 27.1% recorded third quarter 21. While no investment sales were recorded in this submarket during the quarter, one user sale was completed. Weber-Stephen Products purchased Schneider Electric's 155,-SF headquarters in Palatine. The grill maker's plans for the building have not yet been announced for this property but the company maintains a significant footprint in the Northwest Suburban submarket: the company owns a 28,-SF industrial building in Palatine, leases a 48,-SF office building in Rolling Meadows and recently completed construction on a 75,-SF distribution center in Huntley, next to its existing manufacturing facility. Two large lease commitments were announced in the second quarter by telecommunications providers. Verizon signed a new lease for 16, SF at Continental Towers in Rolling Meadows, expanding from 127, SF in Elgin. In addition, Comcast renewed its lease for 73, SF at Windy Point I in Schaumburg. Looking Forward The village of Schaumburg announced second quarter that it is considering a land use plan for the 2-acre Motorola campus as the tech company sheds unused land. Motorola previously sold 39 acres to Zurich North America for its 753, SF headquarters, currently under construction. Another 8.2 acres of Motorola's campus was sold to the Illinois Tollway for construction of a new interchange at Meacham Road and I-9. This infrastructure project will provide improved access to the area, thus enhancing the long-term development potential in the area. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Zurich Tower I 14 American Ln, Schaumburg 441,531 1 Zurich Tower II 145 American Ln, Schaumburg 44,538 1 Northwest Crossings 1421 W Shure Dr, Arlington Heights 218,662 Meadows Corporate Center 255 W Golf Rd, Rolling Meadows 216,592 Fischer Corporate Center 177 N Randall Rd, Elgin 22, Algonquin Rd, Schaumburg 195,393 Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks 1 available late 217 Significant Northwest Suburban Sale Transactions 2nd Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller 1415 S Roselle Rd, Palatine 154,76 $11,867,65 $77 Weber-Stephen Products Schneider Electric USA Significant Northwest Suburban Lease Transactions 2nd Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type Continental Towers 171 W Golf Rd, Rolling Meadows 16, Verizon New lease WindyPoint 15 McConnor Pky, Schaumburg 72,513 Comcast Corporation Lease renewal 13

14 9% 4% 4% 29% 34% Northbrook O Hare Area # OFFICE BUILDINGS 17 Chicago Executive Airport Arlington Heights 2 MARKET SIZE (SF) 15,263, TOTAL VACANCY 2,77,825 SF (17.74%) DIRECT VACANCY 2,616,737 SF (17.14%) SUBLEASE VACANCY 91,88 SF (.6%) AVAILABLE SPACE 3,417,545 SF (22.37%) Elk Grove Village 72 Des Plaines Ohare Int'l Airport Park Ridge Rosemont Skokie Q2 215 NET ABSORPTION (SF) 33, TOTAL 215 NET ABSORPTION (SF) -19,3 UNDER CONSTRUCTION (SF) Q2 215 NEW SUPPLY (SF) Addison 29 Franklin Park 355 Net Absorption Asking Rents Lombard % 33,187 SF At approximately 15.3 million SF, the O Hare submarket is one of the smallest suburban markets. Due to its central location, proximity to O Hare International Airport and access to amenities and public transportation, the O Hare submarket led the suburban office recovery starting in 21. Many companies have identified the O Hare submarket as an ideal location for a new office or a consolidation of multiple locations. Geographically, O Hare sits in the center of the major suburban submarkets providing the middle ground for employees coming from surrounding locations, not to mention immediate access to the airport for multi-market companies. Additionally, O Hare is the only submarket providing access to the CTA s elevated train lines from the city and the Metra North Central line, allowing convenient public transportation for city-dwelling staff members. Vacancy Absorption Inventory by City 24, 16, 26% 24% Schiller Park, Franklin Park, Norridge, Harwood Heights (4%) Bensenville (4%) 8, 22% Park Ridge (9%) Rosemont (34%) 2% -8, 18% -16, % Des Plaines (21%) (%) Net Absorption (SF) Chicago (O Hare Area) (29%) 14 NAI Hiffman With tight class "A" supply, it's anticipated rents will soon push the $2 net PSF level.

15 O Hare Area Quarter in Review Second quarter activity in the O'Hare submarket was relatively quiet, marked by smaller sized transactions compared to large lease commitments. As a result, market fundamentals posted modest improvements. Quarterly absorption totaled 33, SF, decreasing the vacancy rate to 17.74%, down 27 basis points from the previous quarter. Class "A" space in the O'Hare submarket is the tightest in all the suburban office markets at 13.99%. During the quarter, Sysco abandoned plans to acquire US Foods, thus eliminating the potential downsize of 4, SF coming back on the market. One notable sale transaction occurred during the second quarter: Phoenix International Publications purchased a 166, SF office building at 851 W Higgins Rd. One O'Hare Centre, a 38, SF class "A" office building in Rosemont, is currently on the market for sale, featuring an occupancy level in excess of 95% with a targeted price PSF north of $2. Smaller sized lease transactions, both new and renewals, were recorded during the quarter. The largest of such transactions included: First Midwest Bank renewed 18, SF at 851 W Higgins Rd, Reyes Holdings expanded into 14, SF at One O'Hare Centre and Sterling Infosystems, provider of employment screening and background checks, subleased 12, SF at US Cellular Plaza. Looking Forward Shortly after the second quarter ended, Blackstone Group closed on the GE Capital national real estate portfolio which totaled 85 properties. This sale added one O'Hare Area office asset, Pointe O'Hare, a 27, SF class "A" asset, to Blackstone's growing portfolio. This submarket's central location, expanded retail amenities and multiple transportation access points will continue to draw new office users and retain the existing tenant base. As institutional investors look for opportunities in the suburban office market, this submarket will capture their attention as a highly desirable suburban office location with strong market performance. With limited class "A" availabilities, its anticipated rents will push the $2 net PSF level. Largest Blocks of Available Space Building Name Building Address Block Size (SF) O'Hare Gateway Office Center 96 W Bryn Mawr Ave, Rosemont 156,832 Cumberland Centre 545 N Cumberland Ave, Chicago 143, Touhy Plaza 135 E Touhy Ave, Des Plaines 123,176 US Cellular Plaza 842 W Bryn Mawr Ave, Chicago 119,228 Triangle Plaza 875 W Bryn Mawr Ave, Rosemont 92,166 O'Hare International Center II 1255 W Higgins Rd, Rosemont 88,227 Pointe O'Hare I (SL) 955 W Higgins Rd, Rosemont 78,937 (SL) All or partially a sublease listing Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant O Hare Area Sale Transactions 2nd Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller 851 W Higgins Rd, Chicago 166,23 $23,25, $14 Phoenix Intl Publications Lowe Enterprises Investment Management Significant O Hare Area Lease Transactions 2nd Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type 851 W Higgins Rd, Chicago 18,367 First Midwest Bank Lease renewal One O'Hare Centre 625 N River Rd, Rosemont 14,23 Reyes Holdings Lease expansion US Cellular Plaza 843 W Bryn Mawr Ave, Chicago 12,148 Sterling Infosystems Sublease 15

16 Chicago Executive Airport Northbrook East-West Corridor Elgin 9 Schaumburg Arlington Heights 2 # OFFICE BUILDINGS 667 Elk Grove Village Ohare Int'l Airport Rosemont MARKET SIZE (SF) 43,32,999 TOTAL VACANCY 8,417,88 SF (19.56%) DIRECT VACANCY 7,477,53 SF (17.38%) SUBLEASE VACANCY 939,585 SF (2.18%) AVAILABLE SPACE 1,842,467 SF (25.2%) Q2 215 NET ABSORPTION (SF) 31,693 TOTAL 215 NET ABSORPTION (SF) -14, St Charles North Aurora Aurora Dupage Airport Naperville Lombard 38 Oakbrook Terrace Downers Grove 29 Elmhurst 83 Oak Brook Westmont 2 Franklin Park UNDER CONSTRUCTION (SF) 131, Q2 215 NEW SUPPLY (SF) Bolingbrook Romeoville Net Absorption Asking Rents 19.56% 31,693 SF Largest of the suburban office markets, the East-West Corridor is diverse in many ways. Split into western and eastern sections by I-355, the western half of the market consists of relatively new product and the majority of the larger blocks of space. The characteristically more stable eastern section is defined by more diverse multi-tenant buildings, smaller blocks of space, and older product. Historically home to large technological users including Alcatel-Lucent and Tellabs, Inc and other sizeable corporations such as Navistar and BP Amoco, the western half of the market is more prone to sudden changes in vacancy and absorption. Vacancy Absorption Inventory by City 4, 24% Other Suburbs (19%) Oak Brook (16%) 2, 23% 22% Westchester (4%) 21% Aurora (4%) Naperville (15%) -2, 2% Lombard (8%) -4, % Oakbrook Terrace (1%) Downers Grove (13%) (%) Net Absorption (SF) Lisle (11%) 16 NAI Hiffman New development potential is one step closer to reality with the acquisition of the 16-acre site at 22nd and York Rd.

17 East-West Corridor Quarter in Review The East-West Corridor market fundamentals experienced modest improvement during the second quarter with positive absorption of 32, SF, pushing the vacancy rate down to 19.56%, the lowest level in the past seven years. Although performance metrics improved nominally during the quarter, a number of sizable leases announced will positively impact market fundamentals in future quarters. Two significant sales were completed in the second quarter, resulting in five assets changing ownership. Lone Star Funds acquired Columbia Property Trust's portfolio, which included four office buildings totaling close to 1 million SF. Lincoln Property Company and Foxford Communities acquired an office and retail property on a 16-acre site in Oak Brook; the buyer was drawn to the property due to its location and the mixed-use zoning currently in place and is considering a variety of alternative uses for the property. Multiple lease transactions in the 25, to 45, SF range were announced during the quarter. The largest commitment was Inland Real Estate Corporation's new lease of 46, SF at 814 Commerce Drive in Oak Brook. The company looks forward to gaining greater efficiencies, relocating from a three-story building to single-story space. Looking Forward After the end of the second quarter, Blackstone Group closed on the GE Capital national real estate portfolio which totaled 85 properties. This sale added five East-West Corridor office assets to Blackstone's growing portfolio. New development potential in this submarket is one step closer to reality with the completed sale of the portfolio of assets located at 22nd Street and York Rd in Oak Brook. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Shuman Boulevard Shuman Blvd, Naperville 354, Oakmont Centre 7 Oakmont Ln, Westmont 256, Winfield Rd, Warrenville 249,996 Lucent Technologies 26 Lucent Ln, Naperville 225, 24 Cabot 24 Cabot Dr, Lisle Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant East-West Corridor Sale Transactions 2nd Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller Axciom Buildings 3333 Finley Rd & 151 Opus Pl, DG 321,852 $38,75,153 $12 1 Lone Star Funds Columbia Property Trust Highland Landmark III 31 Highland Pky, Downers Grove 275,197 $33,,534 $12 1 Lone Star Funds Columbia Property Trust Corridors III 265 Warrenville Rd, Downers Grove 222, $26,697,19 $12 1 Lone Star Funds Columbia Property Trust ConAgra Foods 215 W Diehl Rd, Naperville 161,865 $26,697,19 $12 1 Lone Star Funds Columbia Property Trust 2122 York Rd, Oak Brook 2 121,866 $4,, 2 Portfolio sale 2 Lincoln Property Co JV 2 John Buck Co JV 2 Significant East-West Corridor Lease Transactions 2nd Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type 814 Commerce Dr, Oak Brook 45,756 Inland Real Estate Corporation New lease Oakmont Tech Center 6-68 Oakmont Ln, Westmont 34,7 Athletico New lease Parkview Plaza 1 Parkview Plz, Oakbrook Terrace 3, Kellen Association Management New lease Highland Landmark III 325 Highland Pky, Downers Grove 29, Microsoft Lease renewal Butterfield Centre 7 E Butterfield Rd, Lombard 26,278 MOL (America), Inc Lease renewal Executive Towers West II 1411 Opus Pl, Downers Grove 25,28 Gallagher Bassett New lease 1 Columbia Property Trust sold 11 suburban office properties totaling 2.9 million SF nationally and a six-building portfolio in the Chicago suburban market, acquired by Lone Star Funds; $ PSF figure represents allocation per Real Capital Analytics 2 Buyer is Lincoln Property Co JV with Foxford Communities and Seller is John Buck Co JV with DRI Development Services and included retail and office properties with additional land for development Entries highlighted in red denote NAI Hiffman transactions 17

18 Oak Brook I-55 Corridor # OFFICE BUILDINGS Downers Grove Westmont 2 MARKET SIZE (SF) 4,19,255 TOTAL VACANCY 528,996 SF (13.16%) DIRECT VACANCY 489,141 SF (12.17%) SUBLEASE VACANCY 39,855 SF (.99%) Naperville Darien 55 Burr Ridge 83 AVAILABLE SPACE 736,658 SF (18.33%) Q2 215 NET ABSORPTION (SF) -42,76 Bolingbrook TOTAL 215 NET ABSORPTION (SF) -65,965 UNDER CONSTRUCTION (SF) Q2 215 NEW SUPPLY (SF) Romeoville Net Absorption Asking Rents 13.16% -42,76 SF Although small in volume of space, the I-55 Corridor market benefits from convenient access to area expressways and tollways including I-55, I-2 and the recently completed I-355 extension. Drawing from an excellent labor pool, the area is an ideal choice for companies who don t want to move as far north as Oak Brook, providing a convenient location for their employees living in the southwest suburbs. Growth in the I-55 Corridor market is tied to the rapid growth of Will County. User types are mixed with a large presence of industrial services, catering to the large industrial base in the area and medical services, supporting the area hospitals in La Grange, Hinsdale, and the Adventist Bolingbrook Hospital. Vacancy Absorption Inventory by City 15, 1, 5, 2% 18% 16% Countryside (4%) Darien (11%) Romeoville, Downers Grove (1%) Bolingbrook (26%) 14% Willowbrook (14%) -5, 12% -1, % (%) Net Absorption (SF) Woodridge (2%) Burr Ridge (24%) 18 NAI Hiffman The vacancy rate fluctuates quarterly yet remains in a consistent range between 12% and 16% over the past seven years.

19 I-55 Corridor Quarter in Review Market fundamentals were impacted by one sizable tenant that vacated during the quarter. Chicago Bridge & Iron Company moved out of approximately 6, SF of space at Tallgrass Corporate Center in Bolingbrook. This departure contributed to the second quarter net absorption total of negative 43, SF, and drove the second quarter vacancy rate up 1 basis points to 13.16%. Given the smaller size of this 4 million SF office market, the vacancy rate fluctuates from quarter-to-quarter but remains in a consistent range from about 12.% to 16.5% over the past seven years. Two notable lease transactions were announced during the second quarter. The University of Chicago Physicians Group committed to nearly 28, SF at the Estancia Corporate Centre in Burr Ridge, expanding from the building next door. Muscular Dystrophy of America (MDA) leased 6,2 SF in Bolingbrook. An office condominium measuring 6,4 SF was purchased by Custom Education Solutions for $15 PSF. Looking Forward Given the smaller size of the submarket relative to the other suburban markets, market fundamentals in the I-55 Corridor tend to fluctuate more as demand is more sporadic in terms of volume and timing. The departure of Chicago Bridge & Iron leaves Tallgrass Corporate Center with a large block of available space which may take time to be absorbed as this office market is primarily comprised of smaller sized office buildings, with the median building size measuring 3, SF. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Tallgrass Corporate Center 1 Remington Blvd, Bolingbrook 124, Remington Blvd, Bolingbrook 79, Burr Ridge Pky, Burr Ridge 71,19 Midpoint II 7135 Janes Ave, Woodridge 46, High Ridge Park Bldg I & II 688 N Frontage Rd, Burr Ridge 34,383 Madison Ridge 832 S Madison St, Burr Ridge 25,13 Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant I-55 Corridor Sale Transactions 2nd Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller 235 Remington Blvd, Bolingbrook 6,371 $955,65 $15 Custom Education Solutions Remquad Office LLC Significant I-55 Corridor Lease Transactions 2nd Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type Estancia Corporate Centre 18 Harvester Dr, Burr Ridge 27,789 University of Chicago Physicians Group New lease 5 Professional Building 55 E Boughton Rd, Bolingbrook 6,2 Muscular Dystrophy of America New lease Entries highlighted in red denote NAI Hiffman transactions 19

20 Overall Trend Downtown Office Market # OFFICE BUILDINGS 447 MARKET SIZE (SF) 134,14, % TOTAL VACANCY 15,88,153 SF (11.85%) DIRECT VACANCY 14,696,844 SF (1.97%) SUBLEASE VACANCY 1,183,39 SF (.88%) AVAILABLE SPACE 26,399,311 SF (19.7%) Q2 215 NET ABSORPTION (SF) 314,256 YTD 215 NET ABSORPTION (SF) 124,577 UNDER CONSTRUCTION (SF) 2,564,446 Net Absorption 314,256 SF Asking Rents Q2 215 NEW SUPPLY (SF) Pictured above: Willis Tower, acquired by The Blackstone Group for $1,3,, during the second quarter. The Chicago Loop, Wacker Drive, and North Michigan Avenue are all iconic landmarks that give Chicago worldwide recognition. Historic buildings and modern high-rises define Chicago s famous skyline, home to several of the tallest buildings in the country. These landmarks, combined with O Hare International Airport and public transportation including the El, commuter train lines and dozens of bus lines, all make Chicago s 24-hour downtown a world-class business center and tourist destination. Wacker Drive in the West Loop is the most active corridor in the downtown office market, but when it comes to rents companies pay for office space, it isn t as expensive as one would think, ranking 2th most expensive for office tenants, behind cities like San Francisco, New York, Austin and Portland, Oregon. Quarter in Review The downtown office market resumed its trend of improving market fundamentals in the second quarter. Positive net absorption totaled 314, SF, driving the year-to-date total to 124,577 SF. The vacancy rate improved 58 basis points over the previous quarter decreasing to 11.5%. The Central Loop submarket experienced the greatest quarterly improvement in the quarter, largely due to Wintrust Wealth Management taking occupancy of 18, SF. Increasing leasing velocity occurred in the second quarter with a two leases announced in excess of 1, SF. Other noteworthy activity includes The Blackstone Group's purchase of Willis Tower, the nation's second tallest building, for $1.3 billion. This represents a record high total purchase price for an office tower outside of New York. Downtown Vacancy Absorption Downtown Direct & Overall Vacancy 1 MM 18% 16% % 15.4% 15.52% 14.62% -1 MM 14% 12% 1.4% 9.15% 1.41% 9.59% 1.91% 9.76% 11.85% 1.97% -2 MM % 2 NAI Hiffman (%) Net Absorption (SF) West Loop Central Loop East Loop North Michigan Avenue Direct Vacancy River North Overall Downtown Sublease Vacancy

21 Downtown Office Market New Development Three new development projects are currently underway in the downtown office market totaling 2.5 million SF, all located in the West Loop. These include a 1.2 million SF office tower at 15 N Riverside Dr, River Point, a 1 million SF office located at 444 W Lake St and a 287, SF asset located at 133 W Fulton on the periphery of the West Loop. The two larger projects have secured sizable commitments during construction: River Point is 56% preleased while15 S Riverside is 51% preleased. Both buildings are expected to be completed by year-end 216. Largest Blocks of Available Space Submarket Building Name Building Address Block Size (SF) West Loop Riverside Plaza 3 S Riverside Plz 497,7 West Loop 311 W Monroe St 387,75 North Michigan Ave The AMA Building 515 N State St 377,421 East Loop AON Center 2 E Randolph St 339,761 West Loop The Franklin 227 W Monroe St 313,462 West Loop River Point 444 W Lake St 31, 1 West Loop The Franklin 222 W Adams St 36,576 Central Loop 23 N LaSalle St 292,777 West Loop 133 W Fulton St 287, 1 West Loop 15 N Riverside Dr 275, under construction Downtown Office Significant Buildings On the Market 2nd Quarter 215 Submarket Building Name Building Address Size (SF) Target Price Price PSF Seller Status East Loop Aon Center 2 E Randolph St 2,7, $712,, $26 Piedmont Office Realty Trust Under contract East Loop Illinois Center 1 Two buildings 1 2,72,34 Undislcosed Undisclosed Equity Commonwealth Marketing River North River North Point 35 N Orleans St 1,243, Undisclosed Undisclosed Shorenstein Properties Under contract Central Loop 18 N LaSalle St 767,65 Undisclosed Undisclosed Beacon Capital Partners Under contract Downtown Office Significant Sale Transactions 2nd Quarter 215 Submarket Building Address Size (SF) Sale Price Price PSF Buyer Seller West Loop 233 S Wacker Dr 3,787,238 $1,3,, $343 The Blackstone Group The Chetrit Group, etc 2 West Loop 1 S Wacker Dr 1,195,17 $344,, $288 John Hancock Real Estate Harbor Grp Mgmt, Clal US Inc West Loop 111 N Canal St 83, $34,, $366 JP Morgan Asset Management Sterling Bay Companies Downtown Office Significant Lease Transactions 2nd Quarter 215 Submarket Building Name Property Address Leased (SF) Tenant Lease Type River North 6 W Chicago Av 38, Groupon Lease renewal/expansion River North 2 W Kinzie St 15, WeWork New lease North Michigan Avenue 41 N Michigan Ave 88, ACGME New lease Central Loop 222 N LaSalle St 78,7 Avant Credit Corporation New lease West Loop River Point 444 W Lake St 52,6 Morton Salt New lease 1 The sale includes two buiidlings at Illinois Center: One Illinois Center, 111 E Wacker Dr, 1,5,34 SF and Two Illinois Center, 233 N Michigan Ave, 1,67, SF. 2 Seller is The Chetrit Group, The Moinian Group, and American Landmark Properties, Ltd 3 Represents office SF; buyer also acquired 1,243 SF of ground floor retail space 21