Metropolitan Chicago Market Review. Office Market Review First Quarter 2015

Transcription

1 Metropolitan Chicago Market Review Office Market Review First Quarter 215

2 To our valued customers, partners and future clients We've upgraded our headquarters after more than 15 years in our Oakbrook Terrace location. NAI Hiffman leadership determined last year that our company and our clients would benefit from a move to more efficient, collaborative and modern workspace. While the prospect of new space was exciting, I think everyone can relate to the challenges presented by a move. The passing of years creates files and piles of accumulated stuff - I came across an unopened box of 2 floppy disks, an old real estate magazine with hand-drawn market maps, and press releases of colleagues featuring some spectacular, though questionable, hairstyle and fashion choices. We purged drawers and closets and cubicles to get down to the essentials. It s a lengthy and sometimes tedious process, but also a good reminder that change and progress are primary components of our industry. The first quarter of 215 reinforced the change due to progress theme - several years of positive absorption in Chicago's office and industrial markets are leading to big moves in 215. Those who took risks during volatile times have seen their investments multiply over the past year. Investments which traded five to seven years ago have been stabilized and they are now changing hands to investors with a long-term investment strategy. Consequently, we ve witnessed some of the largest transactions in Chicago history over the past few months. The same confidence that is powering real estate transactions and construction activity is evident on a larger scale - Blackstone s acquisition of Arden/GE Capital and the Prologis acquisition of KTR Capital Partners are two recent examples. Whether following an aggressive business model or implementing an accretive growth plan, successful companies are clearly executing strategies based on the progress shown in this real estate cycle. Lastly, I am pleased to announce another big move: This publication marks the debut of NAI Hiffman Senior Research Manager Kelly Brown. Kelly joined our research team in February she is a diligent, experienced real estate professional who brings remarkable insight and creativity to our team and our clients. I encourage you to use her and our entire team as a resource in the coming months, and should you find yourself in Oakbrook Terrace, please stop in for a visit - we ve settled in and would love the opportunity to show you around our new headquarters. Regards, John R Picchiotti COO, Brokerage

3 Table of Contents NAI Hiffman Metropolitan Chicago Office Market Review First 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) $6,564 GROSS METRO PRODUCT (214) $59.4 BILLION Case-Schiller Home Price Index EMPLOYMENT - NONFARM (Q1 215) JOBS GAINED (Q3 213-Q3 214) CHICAGO METRO UNEMPLOYMENT RATE ILLINOIS UNEMPLOYMENT RATE U.S. UNEMPLOYMENT RATE 4,486,8 43,2 5.8% 6.6% 5.9% Q4 214 US GDP Change 5% 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 With the revision of the fourth quarter GDP to 2.2%, the US economy grew at an annual rate of 2.4% in 214. Median estimates of GDP growth project at 2.1% for the first quarter of 215 and median estimates for the full year are 3%. The nation s total GDP, in excess of $17 trillion, remains the world s largest, comprising 22% 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. Many factors that contributed to GDP growth have included lower oil prices, improving consumer confidence, higher durable goods sales, an improving housing market and lower unemployment. U.S. retail sales have reached all-time highs, accentuated by growing online sales. 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 U.S. Dollar Index US GDP Change by Quarter 1 6% 9 4% 2% 4.6% 5.% 2.2% 3.1% 8 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 January 214 to $52 in March 215, providing a $34 billion 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 2.2% and 1.5 %, respectively. After gaining 11.4% in 214, the S&P 5 stock index reached an all-time high surpassed the 21 level in March 214. The NASDAQ Composite reached the 5 level the first time since March 2. The housing market continues its slow recovery pattern. 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 return to these 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 well over 2, jobs per month on average, and represents the longest stretch of job creation the country has seen in 15 years. The fourth quarter 214 U.S. unemployment rate dipped below 6% to 5.9% for the first time since mid-28. The rate dropped further to 5.5% in February 215 with the level of Americans filling 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, Source: Federal Reserve Bank of St. Louis S&P/Case-Schiller Home Price Index 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 3.1% 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 First Quarter 215 Office Market Statistics Market/ # Bldgs. Total RBA Direct Sublease Total Total Q1 215 Net Total 215 Q1 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 15,273,39 8,296,341 5,964, 1,12,64 43,32,999 21,192,182 16,844,42 4,996,775 4,19, ,578 2,685, ,73 126,49,495 64,156,315 49,676,12 12,577, % 12.93% 17.15% 13.52% 18.51% 13.79% 23.58% 2.92% 17.21% 14.% 22.% 15.36% 17.55% 14.57% 22.28% 14.25% 1.36% 5.1% 12.45% 7.4% 16.78% 13.75% 21.4% 15.43%.77% 1.2%.25%.7% 1.38% 1.61% 1.33%.32%.8% 1.29%.18%.43% 2.8% 2.6% 2.72%.1% 1.74%.% 2.6%.% 1.41% 1.59% 1.52%.13% 15.17% 14.13% 17.4% 13.59% 19.89% 15.4% 24.91% 21.24% 18.1% 15.29% 22.18% 15.79% 19.63% 16.63% 25.% 14.27% 12.1% 5.1% 15.5% 7.4% 18.19% 15.34% 22.56% 15.56% 21.54% 24.8% 18.47% 17.7% 26.32% 24.95% 28.61% 23.19% 22.75% 2.58% 26.45% 18.8% 24.76% 25.3% 26.68% 17.1% 16.98% 13.67% 19.52% 9.83% 23.91% 24.6% 25.15% 18.32% 44,25 427,829 5,424 6, , ,69-9,346 8,95-142,19-138,768-15,28 11,858-46,156-59, ,823-23,25-26,39 3,14 36,12 362,295-46,115 43,832 44,25 427,829 5,424 6, , ,69-9,346 8,95-142,19-138,768-15,28 11,858-46,156-59, ,823-23,25-26,39 3,14 36,12 362,295-46,115 43, ,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 ,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, % 1.4% 9.26% 3.85% 1.49% 8.31% 11.5% 2.5% 15.58% 15.5% 18.34% 12.77% 14.16% 15.84% 12.83% 11.34% 9.42% 5.51% 13.54% 7.24%.59%.49%.98%.22%.76% 1.1%.51%.1%.89% 1.17%.44%.%.95% 1.34%.69%.% 1.5%.34% 2.6%.25% 1.13% 1.89% 1.24% 4.7% 11.25% 9.41% 11.56% 2.5% 16.47% 16.22% 18.78% 13.72% 15.11% 17.18% 13.51% 11.34% 1.47% 5.85% 15.6% 7.49% 19.2% 19.3% 22.65% 8.63% 19.2% 2.27% 16.58% 22.92% 21.19% 21.54% 24.25% 16.1% 21.71% 22.3% 21.44% 13.61% 15.7% 11.36% 21.72% 1.98% -162,88-117,471-27,932-16, ,311 13,443-18,4 27,812-31,117 16,54 5,249-52,96 9,691 25,77-24,287 8,28-145,476-1, ,244-9, ,88-117,471-27,932-16, ,311 13,443-18,4 27,812-31,117 16,54 5,249-52,96 9,691 25,77-24,287 8,28-145,476-1, ,244-9,476 2,564,446 2,564,446 Downtown Totals Class A Class B Class C ,14,592 71,11,29 45,993,239 17,1, % 1.73% 12.33% 1.98%.77%.83%.83%.39% 12.8% 11.56% 13.16% 11.37% 19.33% 19.67% 2.58% 14.5% -189,679 53,526-2,158-43,47-189,679 53,526-2,158-43,47 2,564,446 2,564,446 Metro Chicago Totals Class A Class B Class C 2, , ,424,87 134,93,344 95,669,359 29,587, % 12.16% 16.85% 12.87% 1.8% 1.19% 1.19%.28% 15.5% 13.35% 18.4% 13.15% 21.55% 21.75% 22.95% 16.13% 17, , , , , , ,449,74 3,449,74 7

8 Overall Trend Suburban Office Market # OFFICE BUILDINGS 2,33 MARKET SIZE (SF) 126,49, % TOTAL VACANCY 22,999,893 SF (18.19%) DIRECT VACANCY 21,212,175 SF (16.78%) SUBLEASE VACANCY 1,787,718 SF (1.41%) AVAILABLE SPACE 3,229,91 SF (23.91%) Net Absorption 36,12 SF Q1 215 NET ABSORPTION (SF) 36,12 TOTAL 215 NET ABSORPTION (SF) 36,12 UNDER CONSTRUCTION (SF) 884,628 Asking Rents Q1 215 NEW SUPPLY (SF) Pictured above: 325 Lacey Road, part of 4-building portfolio at Esplanade in Downers Grove where Accesso Partners, LLC acquired 5% interest from Hamilton Parnters. 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 saw improved market fundamentals in the first quarter, continuing along the positive trend over the past couple of years. Quarterly net absorption was positive, totaling nearly 36, SF. This level of absorption is ahead of the 272, SF recorded during the same time period one year ago. The North Suburban submarket posted the highest quarterly absorption figure at 44, SF. The marked increase was in part due to the two largest suburban office leases signed during the quarter by Baxalta and CDW. The Chicago suburban office vacancy rate improved 37 basis points from the year-end level to the first quarter rate of 18.19%, marking the 7th consecutive quarter the suburban office vacancy rate has declined, from the peak rate of 23.7% in 21. As the market fundamentals improve in the suburbs, owners are looking to reap the benefits of the upswing in the real estate cycle as there are an increasing number of office buildings currently marketed for sale. The largest sale transaction during first quarter was Accesso Partner's 5% stake in Hamilton Partners' four-building portfolio at Esplanade in Downers Grove, totaling 1 million SF. Suburban Vacancy Absorption Suburban Direct & Overall Vacancy 9, 24% 19.89% 19.63% 3, 22% 15.17% 18.51% 18.1% 17.21% 17.55% 18.19% 16.78% 14.39% -3, 2% 12.1% 1.36% -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 New Development Largest Blocks of Available Space Currently, two construction projects are underway Building Name Building Address Block Size (SF) in the suburban office market, both developed on Innovation Park Lake County 6 N US Highway 45, Libertyville 1,121,186 a build-to-suit basis. In the Northwest Suburban Zurich Towers I 14 American Ln, Schaumburg 467,5 submarket, Zurich is building a 753, SF North AON Office Building (SL) 1 Milwaukee Ave, Glenview 45,39 American headquarters in Schaumburg. SKF Group Zurich Towers II 145 American Ln, Schaumburg 4, is constructing a 131, SF facility in the East- Shuman Boulevard Shuman Blvd, Naperville 354, West Corridor, located in Naperville. One significant Oakmont Centre 7 Oakmont Ln, Westmont 256,767 redevelopment is underway for the former Motorola Meadows Corporate Center 255 W Golf Rd, Rolling Meadows 251,756 Mobility Campus in Libertyville. BECO Midwest is renovating the 1.2 million SF property into a multitenanted office complex. Cantera 421 Winfield Rd, Warrenville 249,996 (SL) All or partially a sublease listing Suburban Office Significant Buildings On the Market 1st 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 North Suburban Corporate 5, 5, 51, 52, 54 Lake Cook Rd, Deerfield 697,673 $16,, $229 Arden/GE Marketing Northwest Suburban Atrium Corporate Center 38 Golf Rd, Rolling Meadows 483, $77,, $159 Spear Street Marketing East-West Corridor Naperville Corporate Center, Diehl Rd, Naperville 42,391 $48,5, $115 Tri-Gate/Pearlmark Marketing East-West Corridor 1511 Opus & 3333 Finley Rd, Downers Grove 337,14 Undisclosed Undisclosed Wells RE Funds Marketing East-West Corridor Highland Landmark III, 31 Highland Pkwy, Downers Grove 276,766 Undisclosed Undisclosed Wells RE Funds Marketing East-West Corridor Corridors Three, 265 Warrenville Rd, Downers Grove 221, Undisclosed Undisclosed Wells RE Funds Marketing Suburban Office Significant Sale Transactions 1st Quarter 215 Market Building Address Size (SF) Sale Price Price PSF Buyer Seller East-West Corridor Portfolio of 4 bldgs, Downers Grove 1,24,67 Undisclosed 1 Und 1 Accesso Partners, LLC Hamilton Partners North Suburban 9, 98 & 1 Half Day Rd, Lincolnshire 343, $17,232,55 $5 Medline Industries, Inc Retail Properties of America, Inc O'Hare Area 63 N River Rd, Rosemont 137,2 $4,675, $34 Village Of Rosemont American Academy of Ortho Surgeons Northwest Suburban W Northwest Hwy, Palatine 92,873 $3,21, $35 Urban Comm Prop Grp, Inc Weiss Properties, Inc East-West Corridor 2 S Finley Rd, Lombard 78,3 $4,1, $52 De Amertek Corporation BMO Harris Northwest Suburban 83,85,87 & 89 E Higgins Rd, Schaumburg 69,495 $3,17,5 $45 Robert King Undisclosed East-West Corridor 41 Warrenville Rd, Lisle 63,49 $3,3, $52 Napleton Dealership Group Wells Real Estate Funds East-West Corridor 191 S Highland Ave, Lombard 52,564 $23,,2 $442 Bradford Allen Realty Citizens Financial Group Suburban Office Significant Lease Transactions 1st Quarter 215 Market Property Address Leased (SF) Tenant Lease Type North Suburban 12 Lakeside, Bannockburn 257, Baxalta New lease North Suburban 25 & 75 Tri State International, Lincolnshire 29, CDW New lease East-West Corridor 43 Winfield Rd, Warrenville 146,754 Exelon Lease extension North Suburban 885 Sunset Ridge, Northbrook 75, Barilla New lease East-West Corridor 4245 Meridian Parkway, Aurora 71, Hartford Fire Insurance Co Lease renewal Northwest Suburban 1222 Hamilton Pky, Itasca 54,15 Robertshaw New lease Northwest Suburban 2 N Martingale Rd, Schaumburg 43,93 Schneider Electric New lease East-West Corridor st St, Downers Grove 42, Silgan White Cap Lease renewal 1 5% stake sold: 3131 Woodcreek Dr, 325 Lacey Rd,191 & 21 Butterfield Rd 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 4,598,269 SF (15.17%) 21 DIRECT VACANCY 4,363,393 SF (14.39%) SUBLEASE VACANCY 234,876 SF (.77%) AVAILABLE SPACE 6,531,375 SF (21.54%) Vernon Hills Libertyville Lake Forest Q1 215 NET ABSORPTION (SF) 44,25 Lake Zurich TOTAL 215 NET ABSORPTION (SF) 44,25 Buffalo Grove Highland Park UNDER CONSTRUCTION (SF) 21 Deerfield 68 Q1 215 NEW SUPPLY (SF) Chicago Executive Airport Northbrook Net Absorption Asking Rents 9 Schaumburg Arlington Heights 2 Glenview 43 Niles Skokie Evanston 15.16% 44,25 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 First quarter absorption of 44, SF greatly exceeds the 252, SF absorbed in this submarket in all of last year.

11 North Suburban Quarter in Review The North Suburban office market posted record breaking positive net absorption, totaling 44, SF for the quarter. This figure greatly exceeds the 252, SF absorbed in this submarket during the entire year in 214. The robust level of absorption put downward pressure on the vacancy, which was down 145 basis points from the year-end 214 rate of 16.62% to the first quarter rate of 15.17%. The majority of net absorption occurred in class "A" properties, this activity improved the class "A" vacancy rate to 14.13%, one of the lowest vacancy rates in the suburban office market. The largest sale transaction during the quarter was Medline Industries purchase of a three-building campus, totaling 269, SF, in Lincolnshire. The medical supply distributor acquired the property, formerly home to Aon Hewitt who vacated the property last year, relocating within Lincolnshire. The campus sits on a 4-acre site which could accommodate potential new development should Medline decide to expand. Baxalta, a Baxter spinoff company, committed to occupy the entire 257, SF building at 12 Lakeside Dr in Bannockburn. The property formerly housed Barilla and many other tenants. The pasta maker signed a new lease for 75, SF, relocating to a property in Northbrook that was previously occupied by Nestle USA's pizza division. Another significant lease included CDW's lease for 29, SF at Tri State International Center in Lincolnshire. Looking Forward If tenant demand remains strong, new office development is likely to occur. A developer, Janko Group, acquired a 1-acre parcel in Conway Office Park in Lake Forest. Speculation on plans under consideration include hotel or office development, with an estimated groundbreaking in 216. BECO Midwest announced plans to open Innovation Park in the fall of 215. The company is transforming 1.2 million SF, the former Motorola Mobility campus, into a multi-tenant office complex through a $5 million renovation currently underway. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Innovation Park Lake County 6 N US Highway 45, Libertyville 1,121,186 AON Office Building (SL) 1 Milwaukee Ave, Glenview 45,39 One Parkway North 1 Parkway Blvd, Deerfield 237,228 Lincolnshire Corporate Center 3 Tower Pky, Lincolnshire 175,545 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 129,99 (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 1st Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller 9, 98 & 1 Half Day Rd, Lincolnshire 343, $17,232,55 $5 Medline Industries, Inc Retail Properties of America, Inc 21 E Strong St, Wheeling 2, $2,8, 1 $14 1 Peter J Karahalios Resurrection H. C. Significant North Suburban Lease Transactions 1st Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type Bannockburn Centre At College Park 12 Lakeside Dr, Bannockburn 257, Baxalta New lease Tri State International Office Center 25 & 75 Tri State International, Lincolnshire 29, CDW New lease 885 Sunset Ridge, Northbrook 75, Barilla New lease One Rotary Center 156 Sherman, Evanston 45, ZF Industries New lease Corporate 5 5 Lake Cook Road, Deerfield 14,5 Market6 New lease Bannockburn Corporate Center 3 Lakeside Dr, Bannockburn 8,534 IPC International Lease renewal Sky Harbor Office Center Landwehr Rd, Northbrook 7,562 Friedman & Huey Associates LLP Lease renewal 1 Medical office building 11

12 173 Northwest Suburban # OFFICE BUILDINGS 585 MARKET SIZE (SF) 33,762,617 McHenry 14 Fox Lake Waukegan Regional Airport Waukegan TOTAL VACANCY 6,715,595 SF (19.89%) 176 Libertyville DIRECT VACANCY 6,25,332 SF (18.51%) SUBLEASE VACANCY 465,263 SF (1.38%) AVAILABLE SPACE 8,887,385 SF (26.32%) Q1 215 NET ABSORPTION (SF) 131,358 TOTAL 215 NET ABSORPTION (SF) 131,358 UNDER CONSTRUCTION (SF) 753,3 Q1 215 NEW SUPPLY (SF) Net Absorption Asking Rents 19.89% 131,358 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 Positive net absorption pushed the vacancy rate below the 2% level to the current rate of 19.89%.

13 Northwest Suburban Quarter in Review The Northwest Suburban submarket continued the trend of improving market fundamentals, posting positive net absorption and registering a vacancy rate now below 2%. Over 131, SF of space was absorbed during the quarter, improving the vacancy rate by 39 basis points from the year-end 214 level of 2.28% to the current vacancy rate of 19.89%. Two noteworthy investment sales during the quarter include Urban Commercial Property Group's acquisition of a 92, SF office building in Palatine and Robert King's purchase a four-building portfolio totaling 69, SF in Schaumburg. The largest lease this quarter was signed by Robertshaw, a global design, engineering and manufacturing company which will occupy a 54, SF building in Hamilton Lakes in Itasca. Another notable lease transaction was Schneider Electric's commitment for 43, SF at the Woodfield Corporate Center in Schaumburg. Looking Forward A major construction project underway is Zurich North America Commercial's new 753, SF headquarters in Schaumburg. If market fundamentals sustain an improving trend, some limited office development may occur. With construction underway for the completion of IL 39, formerly called the Elgin-O'Hare Expressway, the southern portion of the submarket may benefit from tollway visibility, additional highway access and improved access to O'Hare International Airport. It's anticipated that existing office buildings as well as developable land sites along the path of this development will enjoy increased interest. The infrastructure project, underway in phases, is tracking an overall completion date in 224. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Zurich Towers I 14 American Ln, Schaumburg 467,5 Zurich Towers II 145 American Ln, Schaumburg 4, Meadows Corporate Center 255 W Golf Rd, Rolling Meadows 251,756 Fischer Corporate Center 177 N Randall Rd, Elgin 231,381 Schaumburg Corporate Center 151 E Woodfield Rd, Schaumburg 225, Northwest Crossings 1421 W Shure Dr, Arlington Heights 218,662 Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant Northwest Suburban Sale Transactions 1st Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller Countryside Tech Park W Northwest Hwy, Palatine 92,873 $3,21, $35 Urban Commercial Prop Grp, Inc Weiss Properties, Inc Woodfield Grove Bus Ctr 83, 85,87 & 89 E Higgins Rd, Schaumburg 69,495 $3,17,5 1 $45 1 Robert King Undisclosed Trace Laboratories 115 W Euclid Ave, Palatine 27, $2,, $74 National Technical Systems, Inc Method Electronics Inc Significant Northwest Suburban Lease Transactions 1st Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type Hamilton Lakes 1222 Hamilton Pky, Itasca 54,15 Robertshaw New lease Woodfield Corporate Center 2 N Martingale Rd, Schaumburg 43,93 Schneider Electric New lease Woodfield Corporate Center 2 N Martingale Rd, Schaumburg 9,237 Nippon Steel & Sumikin Bussan Americas, Inc New lease 89 N State St, Elgin 8,4 Nationwide Insurance New lease Arlington Place II 85 W Algonquin Rd, Arlington Heights 8,342 Hitachi Metals America, Ltd New lease Arlington Corporate Center 325 N Arlington Heights Rd, Arlington Heights 5,882 Paul J Ledder New lease 1 Portfolio of four office buildings 13

14 9% 4% 4% 29% 34% Northbrook O Hare Area # OFFICE BUILDINGS 171 Chicago Executive Airport Arlington Heights 2 MARKET SIZE (SF) 15,273, TOTAL VACANCY 2,751,12 SF (18.1%) DIRECT VACANCY 2,629,35 SF (17.21%) SUBLEASE VACANCY 121,977 SF (.8%) AVAILABLE SPACE 3,475,225 SF (22.75%) Elk Grove Village 72 Des Plaines Ohare Int'l Airport Park Ridge Rosemont Skokie Q1 215 NET ABSORPTION (SF) -142, TOTAL 215 NET ABSORPTION (SF) -142,19 UNDER CONSTRUCTION (SF) Q1 215 NEW SUPPLY (SF) Addison 29 Franklin Park 355 Net Absorption Asking Rents Lombard % -142,19 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 The American Academy of Orthopaedic Surgeons sold their former headquarters to the local municipality, anticipated to be redeveloped.

15 O Hare Area Quarter in Review Market fundamentals weakened during the quarter as net absorption was negative, driving up the vacancy rate. Quarterly absorption was negative 142, SF, increasing the vacancy rate to 18.1%, up 25 basis points from year-end 214. Contributing to the negative net absorption is subleased space which is included in the absorption calculation. MB Financial acquired Cole Taylor Bank last year and identified opportunities to reduce the footprint of the combined financial institutions; it's marketing 88, SF at Pointe O'Hare in Rosemont. The one office building sold in the first quarter was The American Academy of Orthopaedic Surgeons, upon moving into their newly constructed 165, SF headquarters fourth quarter 214, sold its former headquarters location to the Village of Rosemont. The dated office building, built in 1969 and renovated in 1993, was acquired by the local municipality. The future likelihood of the site is for redevelopment. Smaller sized lease transactions were recorded during the quarter. The largest transaction, measuring 18, SF, was a new lease with Ex Libris, a provider of library automation solutions, in Des Plaines. Looking Forward Market fundamentals could weaken further, pending consolidations by companies with significant operations in the O'Hare Area market as previously reported. Additional space could return to the market based upon the merger between US Foods and Sysco as well as Banco Popular exiting the Chicago market through a sale to First Midwest Bancorp. US Cellular is exploring its headquarters options, potentially looking for more than 2, SF in multiple markets. Largest Blocks of Available Space Building Name Building Address Block Size (SF) 135 Touhy Plaza 135 E Touhy Ave, Des Plaines 169,245 O'Hare Gateway Office Center 96 W Bryn Mawr Ave, Rosemont 156,832 Triangle Plaza 875 W Bryn Mawr Ave, Rosemont 149,154 Cumberland Centre 545 N Cumberland Ave, Chicago 143,525 O'Hare Plaza I 8725 W Higgins Rd, Chicago 127,639 US Cellular Plaza 842 W Bryn Mawr Ave, Chicago 119,228 Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant O Hare Area Sale Transactions 1st Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller 63 N River Rd, Rosemont 137,2 $4,675, $34 Village Of Rosemont American Academy of Orthopaedic Surgeons Significant O Hare Area Lease Transactions 1st Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type 135 Touhy Plaza 135 E Touhy Ave 18,222 Ex Libris New lease Presidents Plaza II 87 W Bryn Mawr 9,222 Association of Legal Administrators New lease 135 Touhy Plaza 135 E Touhy Ave 6,864 Allied Benefit Systems, Inc New lease Columbia Centre III 9525 W Bryn Mawr Ave, Rosemont 1,787 Sitex Group New lease Presidents Plaza I 86 W Bryn Mawr Ave, Chicago 1,726 Japanese Chamber of Commerce & Industry of Chicago New lease Pointe O'Hare I 955 W Higgins Rd, Rosemont 1,257 Morningstar, Inc Lease renewal Entries highlighted in red denote NAI Hiffman transactions 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 8,448,781 SF (19.63%) DIRECT VACANCY 7,553,34 SF (17.55%) SUBLEASE VACANCY 895,747 SF (2.8%) AVAILABLE SPACE 1,653,646 SF (24.76%) Q1 215 NET ABSORPTION (SF) -46,156 TOTAL 215 NET ABSORPTION (SF) -46, 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, Q1 215 NEW SUPPLY (SF) Bolingbrook Romeoville Net Absorption Asking Rents 19.63% -46,156 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 Net absorption totaled -46, SF largely due to two tenants vacating over 13, SF during the quarter.

17 East-West Corridor Quarter in Review The East-West Corridor experienced a slight rise in the vacancy rate due to class "A" space returning to the market. The vacancy rate increased 13 basis points from the year-end 214 rate to 19.63%. Net absorption totaled negative 46, SF. Two tenants vacated larger blocks of space: Everest College gave back 38, SF at the Fox River Corporate Center in North Aurora and American InterContinental University/Career Education moved out of 93, SF at Corridors One in Downers Grove. Sales activity was robust during the quarter, including an investment portfolio, user sales and the disposition of bank-owned assets. The largest transaction was the sale of a 5% stake by Hamilton Partners for a four-building, 1 million SF portfolio located in Downers Grove. Larger lease transactions were predominantly renewals. The biggest transaction of the quarter was Exelon's lease extension for 147, SF in Warrenville's Cornerstone II at Cantera. Looking Forward Increased sales activity, especially class "A" properties on the eastern side of the market, is impacting the financial term of lease negotiations. There are landlords with buildings on the market or considering putting their building on the market, increasing rental rates and lowering concessions in an effort to achieve the highest returns. Sales activity as well as the number of larger lease renewals underscores the desirability of the East-West Corridor office market. Several portfolio sales were recently announced including Columbia Trust's national portfolio of 14 properties with 6 assets in the East-West Corridor. General Electric Co is divesting its $3 million real estate portfolio which includes Oakbrook Terrace Tower as well as a number of other buildings in the East-West Corridor. Blackstone is reportedly in agreement to buy most of the GE assets. Largest Blocks of Available Space Building Name Building Address Block Size (SF) Shuman Boulevard Shuman Blvd, Naperville 354, Oakmont Centre 7 Oakmont Ln, Westmont 256,767 Cantera 421 Winfield Rd, Warrenville 249,996 Lucent Technologies 26 Lucent Ln, Naperville 225, 24 Cabot 24 Cabot Dr, Lisle 25,633 Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant East-West Corridor Sale Transactions 1st Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller Esplanade Complex Portfolio of 4 bldgs, Downers Grove 1,24,67 Undisclosed 1 Undisclosed 1 Accesso Partners, LLC Hamilton Partners Oak Creek Center 2 S Finley Rd, Lombard 78,3 $4,1, $52 De Amertek Corporation BMO Harris Corporetum Off Campus X 41 Warrenville Rd, Lisle 63,49 $3,3, $52 Napleton Dealership Group Wells Real Estate Funds Anvil Office Center, Bldg S Highland Ave, Lombard 52,564 $2,3, 2 $44 2 Bradford Allen Realty Citizens Financial Group Waterford Prof Center 1256 Waterford Dr, 2nd Floor, Aurora 41, $1,176, 3 $55 3 Rush-Copley Med Center Union Bank & Trust Paragon Building 2751 Bella Vista Pky, Warrenville 4, $4,435, $111 Heico Holding, Inc Joseph Morabito & Associates Significant East-West Corridor Lease Transactions 1st Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type Cornerstone II at Cantera 43 Winfield Rd, Warrenville 146,754 Exelon Lease extension Hartford Insurance Building 4245 Meridian Parkway, Aurora 71, Hartford Fire Insurance Co Lease renewal Silgan Closures Building st St, Downers Grove 42, Silgan White Cap Lease renewal Corridors Three 265 Warrenville Rd, Downers Grove 28,983 Fresh Thyme New lease Cornerstone II at Cantera 43 Winfield Rd, Warrenville 26,513 Sargent & Lundy Lease renewal Hartford Insurance Building 4245 Meridian Parkway, Aurora 25, Sedgwick Claims New lease 1 5% stake sold: 3131 Woodcreek Dr, 325 Lacey Rd,191 & 21 Butterfield Rd 2 REO Sale 3 REO Sale, space in shell condition 17

18 Oak Brook I-55 Corridor # OFFICE BUILDINGS Downers Grove Westmont 2 MARKET SIZE (SF) 4,19,255 TOTAL VACANCY 486,236 SF (12.1%) DIRECT VACANCY 416,381 SF (1.36%) SUBLEASE VACANCY 69,855 SF (1.74%) Naperville Darien 55 Burr Ridge 83 AVAILABLE SPACE 682,279 SF (16.98%) Q1 215 NET ABSORPTION (SF) -23,25 Bolingbrook TOTAL 215 NET ABSORPTION (SF) -23,25 UNDER CONSTRUCTION (SF) Q1 215 NEW SUPPLY (SF) Romeoville Net Absorption Asking Rents 12.1% -23,25 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, 1% (%) Net Absorption (SF) Woodridge (2%) Burr Ridge (24%) 18 NAI Hiffman The vacancy rate increased 58 basis points from year-end 214 to the current vacancy rate of 12.1%.

19 I-55 Corridor Quarter in Review The vacancy rate increased 58 basis points from year-end 214 to the current vacancy rate of 12.1%. Net absorption totaled negative 23, SF, the result of available space returning to the market outpacing leasing activity. No significant sale or lease transactions were recorded during the first quarter. Given the smaller size of the submarket, relative to the other suburban markets, the weakened market fundamentals due to minimal demand is a typical cycle for a submarket of this size. 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. This office market is primarily comprised of smaller sized office buildings, with the median building size measuring 3, SF. The I-55 Corridor will continue to attract service-oriented tenants with smaller size requirements that do not need a high-profile building or address. The I-55 Corridor provides a good value with proximity to highways and neighboring, larger office market. 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 46,624 MidPoint IV 7155 Janes Ave, Woodridge 29,344 High Ridge Park Bldg I 688 N Frontage Rd, Burr Ridge 26,98 Contiguous Block Analysis 2,+ SF 5,+ SF 1,+ SF Class A Blocks Class B Blocks Class C Blocks Significant I-55 Corridor Sale Transactions 1st Quarter 215 Building Name Building Address Size (SF) Sale Price Price PSF Buyer Seller 5859 S LaGrange Rd, Countryside 16,653 $3,75, $185 J & JC RE Corp Trust Significant I-55 Corridor Lease Transactions 1st Quarter 215 Building Name Property Address Leased (SF) Tenant Lease Type The Offices at Windham Lakes Windham Pkwy, Romeoville 5,565 Stormtrap New lease 19

20 Overall Trend Downtown Office Market # OFFICE BUILDINGS 447 MARKET SIZE (SF) 134,14, % TOTAL VACANCY 16,1,49 SF (12.8%) DIRECT VACANCY 15,157,52 SF (11.31%) SUBLEASE VACANCY 1,37,357 SF (.77%) AVAILABLE SPACE 25,898,989 SF (19.33%) Net Absorption -189,679 SF Q1 215 NET ABSORPTION (SF) -189,679 TOTAL 215 NET ABSORPTION (SF) -189,679 UNDER CONSTRUCTION (SF) 2,564,446 Asking Rents Q1 215 NEW SUPPLY (SF) Pictured above: 55 E Monroe Street was acquired by Prudential RE Investors for $367,3, or $296 PSF during the first quarter. The Chicago Loop, Wacker Drive, North Michigan Avenue and the South Michigan Avenue Streetwall 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 experienced weakened market fundamentals first quarter as available vacant space returning to the market outpaced demand. Negative net absorption totaled negative 189,679 SF, which in turn, caused the vacancy rate to increase to 12.8%, a 14-basis point uptick over the year-end rate. Demand for class "B" space contributed to the lackluster absorption, totaling negative 2, SF while class "A" space resulted in positive net absorption of 54, SF. The Central Loop submarket was the only CBD submarket to improve during the quarter, posting positive net absorption nearing 14, SF. There were no leases signed in excess of 1, SF during the quarter, which also impacted absorption figures. The largest lease signed was by Mead Johnson, committing to 75, SF in River Point, currently under construction. Downtown Vacancy Absorption Downtown Direct & Overall Vacancy 1 MM 18% 16% 16.47% 15.58% 15.11% 14.16% -1 MM 14% 12% 1.13% 9.55% 11.25% 1.49% 9.42% 12.8% 1.47% 11.31% -2 MM 1% 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 Other noteworthy activity during the quarter was the announced agreement by The Blackstone Group to acquire Willis Tower for $1.3 billion. 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 are expected to be completed by yearend 216. Largest Blocks of Available Space Submarket Building Name Building Address Block Size (SF) West Loop 311 W Monroe St 387,79 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 1 31, West Loop The Franklin 222 W Adams St 36,576 Central Loop 23 N LaSalle St 292,777 West Loop 15 N Riverside Dr 1 275,461 Central Loop Insurance Exchange Building 175 W Jackson Blvd 271,2 River North 6 West Chicago 6 W Chicago Ave 231,2 1 under construction Downtown Office Significant Buildings On the Market 1st Quarter 215 Submarket Building Name Building Address Size (SF) Target Price Price PSF Seller Status West Loop Willis Tower 233 S Wacker Dr 3,787, $1,3,, $343 Blackstone Under contract East Loop AON Center 2 E Randolph St 2,689,8 $65,, $242 Piedmont Office Trust Marketing East Loop The Sullivan Center 1-33 S State St 3,9 $252,, $267 Elad Marketing Central Loop One North Dearborn 1 N Dearborn St,3 $235,, $25 Chetrit Group Marketing West Loop Civic Opera House 2 N Wacker Dr 915,1 $21,, $229 Berkley Properties Marketing West Loop 111 N Canal St 83, $3,, $361 Sterling Bay Companies Under contract Downtown Office Significant Sale Transactions 1st Quarter 215 Submarket Building Address Size (SF) Sale Price Price PSF Buyer Seller East Loop 55 E Monroe St 1,242,36 $367,3, $296 Prudential RE Investors Walton St Capital JV Glen Star West Loop 3 S Riverside Plz 1,48,357 $22,, $21 World-Wide Holdings Corp JV Cammeby's J Mizarachi JV David Werner North Michigan Ave 515 N State St 683,347 $138,5, $23 Beacon Capital Partners UBS Real Estate KAG North Michigan Ave 515 N State St 622,5 $137,5, $221 Ivanhoe Cambridge JV Callahan Capital 1 Beacon Capital Partners West Loop 55 W Adams St 478, $185,, $387 GLL Real Estate Partners SEB Immolnvest Downtown Office Significant Lease Transactions 1st Quarter 215 Submarket Building Name Property Address Leased (SF) Tenant Lease Type West Loop River Point 444 W Lake St 75, Mead Johnson Nutrition New lease East Loop The Sullivan Center 1 S State St 67, Centro New lease/expansion River North The Merchandise Mart 222 Merchandise Mart Plz 6, Yelp Lease expansion North Michigan Ave Wrigley Building 41 N Michigan Ave 39,362 Optimus New lease West Loop 111 North Canal 111 N Canal St 27, GoGo, Inc Lease expansion East Loop One Prudential Plaza 13 E Randolph St 23,266 Prescient Edge New lease East Loop One Prudential Plaza 13 E Randolph St 22,939 Textura New lease East Loop One Prudential Plaza 13 E Randolph St 17,993 Time, Inc New lease Central Loop 222 N LaSalle St 17,117 One North Interactive New lease River North Adlake Building 32 W Ohio St 17, Trunk Club New lease/expansion River North 363 W Erie St 12,951 Worldwide Express New lease River North 363 W Erie St 1,5 HighGround, Inc New lease 1 4% interest 21