CHICAGO INVESTMENT MARKET OVERVIEW

Q4 2013 INVESTMENT CHICAGO INVESTMENT MARKET OVERVIEW Office U.S. investors indicate a clear preference for office assets in their home country, with three out of four respondents in Colliers International s annual Global Investor Sentiment report anticipating that their primary investment focus during the next 12 months will be in the United States. Central and Latin America, as well as the UK, lag far behind. Within the U.S., global gateway cities remain the preferred targets for local and foreign investors, with the largest groups of buyers looking at the West Coast markets, followed by New York and Chicago. Nationally, job gains were steady, unemployment fell and fewer people looked for work. However, according to statistics from the U.S. Commerce Department, this recovery is the slowest and most sluggish recovery since World War II. Annual GDP, jobs, and population growth rates have in general been recovering at a snail s pace, particularly in Illinois and Chicago with its pension woes and politics. According to Marquette University, office returns in the Midwest have significantly underperformed the U.S., particularly over the past ten years. On the surface it appears counter-intuitive that a property sector like office, which depends on spaceconsuming office tenants in the services sector, could be a top priority for investors. The reality is that office investors have abundant equity capital committed to the sector, and therefore continue to seek out opportunities in the metropolitan Chicago area. Existing owners have recognized this demand, and continue to replenish the pipeline of office investment offerings. Despite improving, but still weak real estate fundamentals and more of the same lethargy in the Chicago area s overall economy, real estate investors continued to actively seek and acquire major office investments in the Chicago area in 2013 and the same is expected in 2014. Regardless of its economic and pension woes, Chicago continues to be recognized globally as one of the country s most important financial and cultural centers and a key target market in office acquisitions. CHICAGO CBD There are several positive trends occurring beyond the oft-cited economic statistics that are fueling office investment activity in Chicago: The acceptance of real estate as an alternative asset class is increasing Long-term interest rates are expected to hold fairly steady over the next year The overhang of OREO properties has begun to be sold or refinanced Debt Lenders are becoming more risk tolerant and have eased underwriting criteria Equity Investors have likewise been steadily less averse to risk and are seeking higher yield There has been little new construction in the region www.colliers.com/chicago

In 2013, Chicago CBD office investments totaled $3.75 billion, a whopping 70 percent increase over the $2.2 billion of sales in 2012. The average price paid in 2013 equaled $228 per square foot, exceeding the average of $170 per square foot paid in 2012. This number jumped partly due to the significant number of Class A, West Loop properties that traded. Investors also have taken an interest in core-plus opportunities with relatively straightforward underwriting of near-term rollover. A few smaller, vintage assets also traded and will be re-purposed into alternative uses such as hotels or retail. Relative to the steady appetite for office investments - even in light of the woes dictated by economists Chicago s CBD offers numerous bright spots to justify acquisitions. Aside from those discussed above, the CBD s intangibles include: > > A steady CBD population surge and employers awareness of this new demographic trend > > Numerous new migrations of large tenants from the suburban office market to the CBD Billions HISTORICAL TRENDS Chicago CBD Office Investment Sale Volume 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 $0.23 $2.00 200 SOUTH WACKER DRIVE CHICAGO $2.80 $2.20 $3.75 2009 2010 2011 2012 2013 > > A rapidly expanding technology sector including 1871, Motorola Mobility, Google and GoGo > > Mayor Emmanuel s big projects and big headlines have a positive effect on investor perception The year ended on a very high note with 11 properties, totaling over $2.1 billion, trading in a flurry of activity late in the fourth quarter. In what appears to be the largest transaction of the year, KBS REIT made its second jumbo purchase in the CBD by shelling out $425 million on the 1.4-million-squarefoot office property at 500 West Madison Street. Earlier in the year, a venture of Mark Karasick of 601 W Cos. and Michael Silberberg of Berkley Properties completed the long-anticipated $415 million deal to gain control of the 2.2-million-square-foot Prudential I and II office complex overlooking Millennium Park. Just as Met Life had re-entered the CBD market in 2012 with its acquisition of 125 South Wacker Drive, it followed up with the 2013 acquisitions of One North Franklin Street for $187 million and 550 West Washington Street for $111 million. The latter property s seller, Boston-based Beacon Capital Partners, ended its brief absence in Chicago by acquiring 300 South Wacker in the third quarter. Foreign investment continues to be a steady barometer as well. Canada-based Manulife (operating in the U.S. as John Hancock) acquired its third CBD property in three years with the acquisition of 200 South Wacker Drice, and another Canadian firm Ivanhoe Cambridge acquired 10 and 120 S. Riverside for $360 million (with local partner Callahan), after committing $300 million earlier in the year to Hines 45-story River Point office tower in the West Loop. Korean Investors also continue to be attracted to Chicago, as evidenced by Mirae s acquisition of 225 West Wacker Drive from Hines for $218 million, and Korea Post s investment in 161 N. Clark Street for $331 million. CONCLUSION Even in light of the slow improvement in real estate fundamentals, sales of Chicago CBD office properties should remain strong in 2014. Several properties are being teed up to go to market while a few 2013 offerings, such as 200 South Michigan Avenue and 311 South Wacker Drive, are expected to close in the first quarter of 2014. The lack of new construction and ample supplies of cheap debt and equity, coupled with the long list of Chicago s intangibles, should maintain the CBD s widespread appeal and healthy sales pricing. P. 2 COLLIERS INTERNATIONAL

CHICAGO CBD SALES 2013 SELLER PURCHASER SF LOCATION VALUE PSF 400 S. JEFFERSON STREET HIGHEST PSF SALE IN THE CBD ($416.90) Net Leased Corporate Headquarters 601 West Associates, LLC Tier REIT/ Pearlmark/EGI GE Asset Management Harbor Group International BGK Equities OBO Rosemont Realty Bentall Kennedy (US), LP Tier REIT Tier REIT General Electric Pension Fund Melohn Properties 528,104 Manulife (Hancock) 759,000 KBS REIT 1,457,470 Beacon Capital Partners 512,436 Redico JV DRW Trading 80,228 Beacon Investment Properties Callahan/Ivanhoe Cambridge Callahan/Ivanhoe Cambridge 393,094 684,911 684,962 CBRE Global Investors 952,559 111 West Jackson 200 South Wacker Drive 500 West Madison Street 300 South Wacker 10 North Dearborn 20 North Clark Street 10 South Riverside 120 South Riverside 181 West Madison $135,000,000 $255.63 $215,000,000 $283.27 $425,000,000 $291.60 $112,500,000 $219.54 $11,500,000 $143.34 $63,750,000 $162.17 $180,500,000 $263.54 $180,500,000 $263.52 $302,000,000 $317.04 Tishman Speyer MetLife 643,503 1 North Franklin $187,000,000 $290.60 Tishman Speyer Farbman Acquisitions, LLC CBRE GI/Korean Consortium Drake Real Estate Partners 1,068,877 161 North Clark $331,250,000 $309.90 171,876 Aries Investors MB Real Estate 85,190 CBRE Global Investors Tishman Speyer 797,750 Chetrit Oxford Capital 260,823 216 W Jackson Blvd 68 E Wacker Place 190 South LaSalle 360 North Michigan Avenue $22,300,000 $129.74 $9,500,000 $111.52 $211,250,000 $264.81 $53,000,000 $203.20 Kemper Corp AmTrust Realty Corp 526,158 One East Wacker $94,000,000 $178.65 Hudson Advisors Tribeca Holdings (Retail) / Goldman Sachs / Golub (Office) 343,072 625 North Michigan Avenue $107,000,000 $311.89 MB Real Estate Ameritus 263,650 205 W Wacker Dr $22,750,000 $86.29 Deutsche Bank/ Northstar NorthStar Realty Finance Corp. Sterling Bay JPMorgan Global Real Assets Harbor Group International Hearn Company, Lynd, et al 601 W Companies 2,204,137 Cole Real Estate Investments Mirae Asset Global Investments 896,980 875 N Michigan $140,000,000 $156.08 233,869 Shidler Group 579,848 CIBC Cagan Mangement 89,694 Beacon Capital Partners MetLife 372,597 180 N Stetson Avenue 400 South Jefferson $415,000,000 $188.28 $97,500,000 $416.90 650,812 225 West Wacker $218,000,000 $334.97 111 West Washington 123 West Madison 550 West Washington $94,600,000 $163.15 $4,850,000 $54.07 $111,250,000 $298.58 P. 3 COLLIERS INTERNATIONAL

SUBURBAN CHICAGO The suburban Chicago office market began to pick up in the second half of 2013, as several big lease deals were announced and tenant activity began to awaken from its slumber during the year. The suburban office market achieved its lowest vacancy level in over four years as 2013 came to a close, but at 20.5 percent overall vacancy, the suburban market is still a conundrum for most office investors. A strong knowledge of the individual submarkets and the key trends within it are key to investing in the suburban Chicago office market. CENTRAL PARK OF LISLE LINCOLNSHIRE SOLD FOR $175 PSF While it remains a tenant s market, Class A space is tightening and sales activity has been focused on well located Class A assets. A prime example of this trend is the fourth quarter sale of Central Park of Lisle in Naperville for $116 million ($168 psf). White Oak/Angelo Gordon/Fulcrum had purchased the 75 percent leased asset in early-2010 for $80 million, then leased it up to 90 percent and sold it to Blackstone for a strong profit. The leasing story is a testament of the flight to quality seen all throughout the suburbs. On the opposite side of the spectrum are the opportunity plays which occurred in 2013. Acquiring higher-quality office buildings at low prices per square foot allow the new owners to quickly lease up the vacancies at lower rents than the competition. They include the $58.5 million ($64.24 per square foot) sale of Continental Towers, a 910,627-square-foot property in Rolling Meadows which was purchased by Walton Street Capital along with GlenStar, its local operating partner. Continental Towers was a victim of the crash and was sold by Colliers International for CWCapital as the latter tried to clear out its portfolio of defaulted loans. Walton/GlenStar is off to a good start, having leased 18,000 square feet in December to Rational A.G. As witnessed in prior years, significant corporate owner-occupied real estate activity has been healthy throughout the suburbs. When Kraft Foods Inc. split into two separate public companies in 2012, Hamilton Partners acquired its campus in Glenview and subsequently sold the bulk of the office buildings to Illinois Tool Works for $42 per square foot. Over the years, Walgreens had acquired Lake Cook Office Center I-IV in Deerfield, and in 2013 executed an $80 million, 10-year sale leaseback with Realty Income Corporation. Earlier in the year, a venture led by New York-based real estate investment trust W.P. Carey & Co. paid $72.3 million, or about $93 per square foot, for Kraft Foods Northfield headquarters. While during most of the recovery period lenders continued to work with borrowers to modify or even extend loans, 10 foreclosure proceedings are currently underway in the suburbs. Many special servicers have begun to believe that asset values have stabilized, and, convinced there is a market heating up for value-add or opportunity investors, have begun to put properties on the market. CWCapital, as part of its $2.5 billion portfolio of properties and loans, will be selling off Chicago properties such as International Tower in Chicago (O Hare market), 500 Davis Street in Evanston, National Plaza I, II & III in Schaumburg, and 3030 Warrenville in Lisle. Overall in 2013, Colliers tracked the sale of 41 suburban office assets, amounting to an overall transaction volume of just over $1.0 billion, with an average sale price of $108. Sales activity for assets over $10 million totaled over $950 million during 2013, which is approximately 52 percent more than 2012 activity. In 2013, individual prices ranged from $23 per square foot to $255 per square foot which is the price that Oak Street Capital paid for the sale/leaseback of the Tate and Lyle headquarters in Hoffman Estates IL. Each of the submarkets had significant sales activity in 2013. Examples are highlighted below: P. 4 COLLIERS INTERNATIONAL

O HARE Notable investment sales in the O Hare market include 2300 E. Devon Avenue, a 239,331-square-foot property in Des Plaines which sold to Saban Capital Group, Inc. for $39 million ($162.95 per square foot). The property is currently home to FAA Regional Headquarters. Early in 2014, O Hare Aerospace Center, a three-building, 203,912-square-foot property in Schiller Park is currently under contract. NORTHWEST KEMPER LAKES BUSINESS CENTER LONG GROVE, IL NEW TO MARKET Notable investment sales in the Northwest market during the fourth quarter of 2013 include Sovereign Partners, LLC. s $40 million ($66.00 per square-foot) purchase of Two Century Centre and Centennial Center, totaling 605,297-square-feet. Both are high quality buildings that have significant upside through lease-up. Also trading during 2013 was 25 Northwest Point, a 207,136-square-foot property in Elk Grove Village which sold to Farbman Group for $19.7 million ($95.11 per square foot). Reportedly, 955 American Lane, a 109,373-square-foot property in Schaumburg, is currently under contract, and 532,975 square feet of buildings at 150 and 200 N. Martingale Road (part of Woodfield Corporate Center) were returned to the lender in a deed in lieu of foreclosure. NORTH The North market recorded sales of 1603 Orrington Avenue, a 307,255-square-foot property in Evanston that was sold to Golub and Investcorp International for $55.8 million ($181.45 per square foot); 111 S. Pfingsten Road, a 120,927-square-foot property in Deerfield that was sold to Adventus Realty Trust for $15.5 million ($128.18 per square foot); 440 N. Fairway Drive, a 99,579-square foot property in Vernon Hills that was sold to Select Income REIT for $18 million ($180.76 per square foot); and 1100 W. Lake Cook Road, a 97,831-square foot property in Buffalo Grove that was sold to Hamilton Partners for $3.1 million ($32.00 per square foot). Office buildings on the market and for sale at year s end include 1717 Deerfield Road, a 141,186-squarefoot property in Deerfield; One Conway Park, a 105,000-square-foot property, acquired in a joint venture between Sam Zell s Equity Group Investments LLC and Chicago-based Fulcrum Asset Advisors LLC and West Lake of Conway Park, a 100,000-square-foot property, both in Lake Forest. The 1.1 million-square-foot former Motorola Mobility Headquarters in Libertyville was recently added to the market and Bannockburn Lake Office I, II & IV (composed of 315,738 square feet), are currently in receivership. Lastly, Equus has elected to sell Kemper Lakes Business Center, a 1.1-million-squarefoot office complex in north suburban Long Grove. EAST-WEST CORRIDOR There were numerous investments sales completed in the East-West Corridor (Lisle-Naperville-Oak Brook) including Stabilis Capital s purchase of East-West Corporate Center, a two-building, 220,461-square-foot property in Naperville for $23 million ($104.23 per square foot); Beacon Investment Properties $24 million ($113.87 per square foot) purchase of Park Plaza, a 210,775-squarefoot property in Naperville; and Walton Street Capital/GlenStar Properties $9.5 million ($45.96 per square foot) purchase of 2400 Cabot Drive, a 205,633-square-foot property in Lisle. Earlier in the year Agellan Commercial REIT purchased Naperville Woods Office Center, a twobuilding 486,979-square-foot property in Naperville for $83.4 million ($171.23 per square foot); and RREEF s purchase of 9022 Heritage Parkway, a 94,233-square-foot property in Woodridge for $13.3 million ($141.14 per square foot). The largest transaction was Blackstone Group s purchase of Central Park of Lisle, a two-building, 693,000-square-foot property in Lisle for $116 million ($168 per square foot). Marlin Equity recently added One Tellabs Center, a 800,000-square-foot property in Naperville to the market. Additionally, 1717 Park Street, a 114,016-square-foot property, also in Naperville, sold in early 2014 to a local partnership for $5.7 million ($50 per square foot). P. 5 COLLIERS INTERNATIONAL

CONCLUSION Riding the wave of activity in 2013, we expect 2014 to be another big year for investment sales in the suburbs, as owners (and some lenders) look to cash out while the submarkets are getting easier to read at this point. Time will tell how things are going to change as the suburbs prepare for the shock waves of big investment offerings (Kemper, Tellabs), vacancies (Zurich Towers, Motorola) and further corporate mergers (Sysco/U.S. Foods). Investor interest will still be strong for core assets, and investors seeking strong upside will battle intensively to gain control of the best assets in the best locations. CHICAGO SUBURBAN SALES 2013 ONE TELLABS CENTER NAPERVILLE, IL NEW TO MARKET LOCATION SF VALUE PSF BUYER SELLER 5450 Prairie Stone Parkway Hoffman Estates 801 Waukegan Road Glenview 701 Warrenville Road Lisle 1751 W Diehl Road Naperville 4225 Naperville Road Lisle 1100 Lake Cook Road Buffalo Grove 800-810 Jorie Boulevard Oak Brook 2301 Patriot Boulevard Glenview 1000 Milwaukee Avenue Glenview 215 Shuman Boulevard Naperville 1900 E. Golf Road Schaumburg 440 N. Fairway Drive Vernon Hills 1700 E. Golf Road Schaumburg 111 S. Pfingsten Road Deerfield 110,000 $28,000,000 $255 500,000 $24,100,000 $48 68,046 $2,500,000 $37 220,020 $22,950,000 $104 Oak Street Real Estate Capital from Tate and Lyle Illinois Tool Works (ITW) from Kraft Foods Group/Hamilton Millbrook Real Estate from Winthrop Realty Trust Stabilis Capital Management from Wells Fargo 693,438 $116,250,000 $168 Blackstone from Angelo Gordon 99,000 $3,000,000 $30 193,688 $16,250,000 $84 167,000 $26,200,000 $157 Hamilton Capital Investors Inc from HDG Mansur Server Farm Realty from LNR Property Corporation Globe Corporation from A I Glenview LLC 416,209 $90,083,556 $216 ARCP from CapLease 210,774 $24,000,000 $114 266,910 $19,000,000 $71 99,579 $18,000,000 $181 221,177 $16,500,000 $75 121,000 $15,528,000 $128 Beacon Investment Properties LLC from TA Realty Sovereign Partners from Aslan Realty Partners Select Income REIT from Dividend Cap Diversified Prop Fund Sovereign Partners from Aslan Realty Partners Adventus RE Ptnrs from Saban Capital Group 1000 MILWAUKEE AVE GLENVIEW, IL SOLD FOR $216 PSF P. 6 COLLIERS INTERNATIONAL

CHICAGO SUBURBAN SALES 2013 LOCATION SF VALUE PSF BUYER SELLER 908 N. ELM STREET HINSDALE SOLD FOR ($210 PSF) 1603 Orrington Ave, Evanston 308,695 $61,055,000 $198 Golub & Co from Lowe Enterprises 1420 Kensington Rd, Oak Brook 1420 Kensington Rd, Oak Brook 1750 E Golf Road Schaumburg 2400 Cabot Drive Lisle 1750 E Golf Road Schaumburg 2400 Cabot Drive Lisle 25 NW Point Boulevard Elk Grove Village 1411 Lake Cook Road Deerfield 1425 Lake Cook Road Deerfield 1417 Lake Cook Road Deerfield 1419 Lake Cook Road Deerfield 4450 Weaver Parkway Warrenville 908 N. Elm Street Hinsdale 2651 Warrenville Road Downers Grove 400 E. Diehl Road Naperville 2000 York Road Hinsdale 4801 N Ravenswood Avenue Chicago 9022 Heritage Parkway Woodridge 1701 Golf Road Rolling Meadows 739 Roosevelt Road Glen Ellyn 2805 Butterfield Road Oak Brook 2800 W. Higgins Road Hoffman Estates 2300 N. Barrington Road Hoffman Estates 2895 Greenspoint Parkway Barrington 1000 E. Warrenville Road Naperville 1100 E. Warrenville Road Naperville 298,946 $35,650,000 $119 Adventus RE Ptnrs from The Davis Cos 298,946 $35,650,000 $119 Adventus RE Ptnrs from The Davis Cos 212,212 $20,000,000 $94 202,500 $9,500,000 $47 212,212 $20,000,000 $94 202,500 $9,500,000 $47 Boxer Property from Pearlmark RE Partners Walton Street Capital from Global Securitization Services Boxer Property from Pearlmark RE Partners Walton Street Capital from Global Securitization Services 207,136 $19,700,000 $95 Farbman Group from John Buck Co 203,550 $40,000,000 $197 Realty Income Corp from Walgreens 165,400 $17,958,734 $109 Realty Income Corp from Walgreens 103,000 $11,183,492 $109 Realty Income Corp from Walgreens 100,000 $10,857,759 $109 Realty Income Corp from Walgreens 59,989 $4,850,000 $81 169,000 $35,500,000 $210 300,000 $24,000,000 $80 58,711 $7,100,000 $121 199,245 $8,000,000 $40 135,000 $6,500,000 $48 94,233 $13,300,000 $141 932,854 $58,500,000 $63 233,143 $5,300,000 $23 312,212 $32,971,500 $106 202,838 $12,000,000 $59 148,385 $7,000,000 $47 147,412 $4,500,000 $31 264,261 $45,253,791 $171 222,756 $38,146,202 $171 Avgeris & Associates from Alloya Corporate G-A Healthcare REIT II from Bentall Kennedy Transwestern JV Soundview Real Estate Partners from LNR Partners Sara Investment Real Estate from Congaree River Convergent Capital Partners LLC from Duke Realty Hayes Properties Inc from Newark Corporation Deutsche Asset/Wealth Mgmt from Oak Realty Group Walton Street Capital from CWCapital Asset Mgmt Clark Street Development LLC from GMAC Commercial Mortgage Adventus RE Ptnrs from Inland American REIT Lincoln Property Co from MEPT/Bentall Kennedy Lincoln Property Co from MEPT/Bentall Kennedy Lincoln Property Co from MEPT/Bentall Kennedy Agellan Comm'l REIT from Cargill Value Investment Agellan Comm'l REIT from Cargill Value Investment P. 7 COLLIERS INTERNATIONAL

Industrial Industrial investment sales remained strong in Chicago in 2013 with total sale volume slightly higher than 2012 results. Chicago traded $1.11 billion worth of industrial product during 2013 (compared to $1.06 billion in 2012). This volume level is slightly above the historical average, although below the peak of $1.7 billion in 2006. More than $317 million of total 2013 volume consisted of the Chicago portion of large multi-city portfolio sales. Although this has to considered when analyzing the Chicago market, however, very large multi-city transactions are available to a limited group of investors. Net transaction volume, excluding these transactions, would be classified as a down year. This lack of volume creates a shortage of high-quality opportunities institutional investors are seeking. After lagging much of the country, Chicago s user market fundamentals improved dramatically with overall market vacany dropping to 8.7 percent from 9.5 percent at year-end 2012. With interest rates remaing at or near historical lows and an increasing amount of both short- and long-term financing available, demand outstripped supply for core transactions for the fourth consecutive year. Chicago saw significant amount of Class B product traded for the first time since 2007. This segment was led by two large transactions, a $102 million sale from Ares Capital to IndCor and a $80 million transaction sold by KTR Capital Partners to Westmount Real Estate. Although the KTR sale closed in January, it was priced and marketed in 2012. These large Class B transactions attracted private equity money, a sector that largely ignored Chicago industrial real estate in the past, because of comparatively low yields. With today s available debt capital, and capitalization rates for Class B product in the 7.75 percent to 9.0 percent range, these Class B investments underwrite to leveraged returns in the 15 percent to 20percent range. Core Class A investments continued to trade at levels at or above historic highs. Cap rates for Class A assets range from 5.5 percent to 6.75 percent depending on price psf, lease term and tenant quality. There is a significant premium for investment grade credits as the marketplace continues to search for low risk, quality industrial real estate. CHICAGO INDUSTRIAL INVESTMENT SALES HISTORICAL TRANSACTION VOLUME Millions Millions (SF) Total Sq. Ft. Industrial Sale Volume 30.0 25.0 20.0 15.0 15.0 10.0 10.0 5.0 5.0 0.0 0.0 $49.83 $49.83 $1,600 $1,600,000,000 $1,400 $1,400,000,000 $50.28 $69.94 $73.09 $73.09 $1,200 $1,200,000,000 $59.20 $1,000 $53.95 $1,000,000,000 $63.03 $800 $800,000,000 $59.20 $600 $600,000,000 $46.80 $51.10 $46.80 $51.10 $400 $400,000,000 $200 $200,000,000 $0 2007 2008 2009 2010 2011 2012 2013 $0 2006 2007 2008 Total Sq. Ft. 2009 2010 2011 Industrial Sale Volume 2012 Price/SF Mllions ($) P. 8 COLLIERS INTERNATIONAL

ACTIVE INVESTORS As discussed earlier, private equity investors are now newly active in the market as yields for quality Class B properties begin to meet their hurdle rates on a leveraged basis. Active private equity investors include The Partners Group, DLJ, DRA, and IndCor. Traditional institutional advisors continue to be active with LaSalle Investment Management, TA Realty Advisors, Exeter, Cabot and KTR Capital Partners all closing multiple transactions in 2013. Additionally, both public and private REITs are active as Liberty Property Trust, Duke Realty Corporation, Stag, DCT Industrial Trust, IIT/ IPT, and Welsh all closed Chicago area transactions in 2013. We expect even more investor demand in 2014 as user demand increases and institutional investors get priced out of the coasts. TRANSACTION HIGHLIGHTS As discussed earlier a number of the largest transactions in the Chicago market were a component of a multi-city portfolio transaction. Below are a number of notable transactions that closed in 2013. As you can see the depth and variety of buyers in the market remains impressive. We expect an even more active 2014. o NOTABLE CHICAGO TRANSACTIONS CHICAGO PORTION OF MULTI-CITY TRANSACITONS SALE PRICE/ LOCATION SIZE (SF) BUYER SELLER COMMENTS $170.5 million Various markets $72.68 million Sauk Village / Rochelle $74.0 million DeKalb 2,754,000 Liberty Property Trust Cabot Properties 1.615,045 IndCor Pacific Mutual 1,018,900 Realty Income Corp American Realty Capital Chicago portion of a $1.474 billion national package Chicago portion of 7 million square foot national package Four properties in a 593- property entity level portfolio. CHICAGO ONLY TRANSACTIONS SALE PRICE /LOCATION SIZE (SF) BUYER SELLER COMMENTS $102.7 million Various markets $52.0 million Elgin $34.5 million Carol Stream $28.3 million Kenosha, WI 2,116,052 IndCor Ares Capital 15-building Class B portfolio 1,059,863 DCT Hamilton Partners Five-building portfolio 515,497 TA Realty 626,784 First Industrial LaSalle Investment Management LaSalle Investment Management Class A building leaed for 7 years to Owens and Minor Class A distribution center leased through January 2018 to division of Omicron I-94 LOGISTICS CENTER KENOSHA, WISCONSIN P. 9 COLLIERS INTERNATIONAL

Multi-Family FUNDAMENTALS SLIP AS LOOMING CONSTRUCTION PIPELINE WEIGHS DOWN MARKET Historically high occupancy rates and four years of consistent rent growth have pushed metropolitan Chicago s multi-family rents to a level well above that of income and employment growth. An expanding job market and increased urbanization will continue to fuel renter demand in the downtown area which is expected to be offset by a robust development pipeline for at least the next four quarters. According to MPF research, apartment deliveries in Chicago are projected to remain elevated with annual completions registering between 4,400 to 6,400 units in each of the next four quarters. 3,169 new apartment units were delivered to market in the fourth quarter of 2013 in Chicago and over half, some 1,694 units, were delivered to the Streeterville/River North submarkets. CONSTRUCTION ACTIVITY: PROPERTIES COMPLETED IN 2013 SUBMARKET PROPERTY NAME DEVELOPER UNITS FINISH K2 AT K STATION The Loop K2 at K Station Fifield Companies/Wood Partners 496 06/13 The Loop Coast at Lakeshore East Magellan Development 515 07/13 Streeterville/River North 500 Lake Shore Drive The Related Companies 500 10/13 Streeterville/River North AMLI River North AMLI Residential 409 11/13 Streeterville/River North Optima Center Chicago Optima/DeBartolo Holdings 325 12/13 Streeterville/River North Seneca (The) Waterton Associates 260 12/13 Streeterville/River North 850 Lake Shore Drive Integrated Development Group 200 12/13 Southeast Chicago Vesta Lofts JK Equities 59 09/13 Southeast Chicago Shoreland (The) MAC Property Management LLC 330 12/13 South Cook County Ninety 7 Fifty on the Park Flaherty & Collins Properties 295 08/13 North Cook County AMLI Evanston AMLI Residential 214 08/13 North Cook County 1717 Focus Development 175 10/13 North Cook County Central Station M&R Development LLC 80 10/13 North Cook County 1611 West Division 1601 W Division LLC 99 11/13 Southeast DuPage County Avant at the Arboretum The Opus Group 310 09/13 Far West Chicago Suburbs Algonquin Square Marquette Companies 220 12/13 Will County Springs at 127th Continental Properties Company 340 11/13 ONE YEAR FORECAST: CHICAGO METRO AREA Annual Supply (units) 4,423 Annual Demand (units) 4,201 Occupancy 95.0% Annual Occupancy Change 0.0 Annual Rent Change 2.8% Annual Revenue Change 2.8% Annual Jobs Change +70,000 Source: MPF Research COAST AT LAKESHORE EAST P. 10 COLLIERS INTERNATIONAL

CONSTRUCTION ACTIVITY: PROPERTIES UNDER CONSTRUCTION SUBMARKET PROPERTY NAME DEVELOPER UNITS FINISH HUBBARD PLACE CHICAGO The Loop Madison Aberdeen Place Michigan Avenue Real Estate Group 81 03/14 The Loop 73 East Lake M&R Development LLC 332 04/14 The Loop The Loop Arkadia Tower 26 Aberdeen Street White Oak Realty Partners LLC/ Campus Acquisitions LLC Michigan Avenue Real Estate Group 350 04/15 54 06/14 The Loop Madison at Racine (The) Ascend Real Estate Group 216 09/14 The Loop AMLI on Clark AMLI Residential 398 10/14 The Loop Catalyst * Marquette Companies 223 10/14 The Loop 111 West Wacker Drive * The Related Companies 504 08/14 Streeterville/River North 212 West Illinois Illinois Franklin Associates LLC 188 01/15 Streeterville/River North 435 North Park DRW Holdings LLC 398 01/15 Streeterville/River North Hubbard Place The Habitat Company 450 01/14 Streeterville/River North 845 North State Newcastle Limited 367 02/15 Streeterville/River North Scott Street Flats JDL Development/Harlem Irving Companies 71 05/14 Streeterville/River North 220 West Illinois Street Gerding Edlen/Fred Latsko 188 10/14 Lincoln Park/Lakeview Belden Stratford Laramar Group 297 01/15 Lincoln Park/Lakeview Webster Square Sandz Development 75 12/14 Lincoln Park/Lakeview Halsted Flats JDL Development 269 11/14 North Cook County E2 Carroll Properties Inc/Fifield Companies 368 07/15 North Cook County Ravenswood Terrace Belgravia Group Ltd 150 10/14 North Cook County Midtown Square Trammell Crow Residential 142 11/14 Arlington Heights/Palatine/ Mount Prospect One Arlington Stoneleigh Companies LLC 214 09/14 Central DuPage County Wheaton 121 Morningside Group 306 03/14 Naperville Oaks at Naperville Crossings (The) Lennar Multifamily Investors LLC 298 12/14 Lake County/Kenosha Oaks of Vernon Hills (The) REVA Development Partners LLC 304 05/15 Lake County/Kenosha AMLI Deerfield AMLI Residential 240 07/15 Far West Chicago Suburbs Randall Highlands Next Generation Development 146 01/14 MARKET STATISTICS According to MPF Research, occupancies fell 80 basis points in the fourth quarter from the third quarter as Chicago posted its worst quarterly occupancy performance since the recession. A combination of large supply volumes and net seasonal move-outs left the overall occupancy rate for the metro area at 95 percent. Despite this decline in overall occupancies, year-over-year rent growth levels have sustained at 2.6 percent in the fourth quarter which was in-line with similar performance seen over the previous four quarters. The Chicago metro area has averaged rent growth rates of 4 percent for the trailing three-year period. P. 11 COLLIERS INTERNATIONAL

Q4 2013 - CITY OF CHICAGO METRO AREA SNAPSHOT Niche Year Built Current Rate Occupancy Rent Change Monthly Change Qtly Annual Rent Qtly Annual 2000+ 92.30% -2.40% -1.80% $1,776-2.80% 0.80% 1990s 95.80% -0.10% 0.60% $1,276-1.40% 1.30% 1980s 95.40% -0.80% 0.00% $1,279-0.50% 3.30% 1970s 95.20% -0.20% -0.70% $982-0.90% 3.30% Pre-1970 95.80% -0.90% 0.60% $1,078 2.40% 3.60% Building Height Low-Rise 95.50% -0.50% 0.00% $1,015-0.40% 2.30% Mid-Rise 94.90% 0.90% 0.40% $1,111-1.20% 4.30% High-Rise 94.00% -1.90% -1.20% $1,637-1.00% 2.80% Unit Type Efficiency/Studio 93.40% -2.00% -2.00% $1,166-0.80% 1.60% 1 BR 95.20% -0.60% -0.20% $1,118-1.20% 2.00% 2 BR 95.00% -0.80% -0.20% $1,272-0.60% 3.00% 3 BR 94.80% -0.80% -0.50% $1,643 1.00% 4.70% Metro Average 95.00% -0.80% -0.30% $1,214-0.70% 2.60% CITY OF CHICAGO SNAPSHOT BY SUBMARKET THE LOOP STREETERVILLE/ RIVER NORTH LINCOLN PARK/ LAKEVIEW SOUTHEAST CHICAGO Existing Units 18,877 31,566 50,880 108,268 Occupancy 93.10% 92.70% 97.60% 93.50% Annual Change -2.30% -2.20% -0.30% 0.30% Avg. Monthly Rent $1,931 $1,922 $1,546 $1,020 Avg. Monthly Rent Per Square Foot Annual Inventory Change 2014 Occupancy Forecast $2.38 $2.42 $2.01 $1.40 6.20% 5.70% 0.00% 0.60% 90.30% 93.00% 97.20% 94.00% SUBURBAN CHICAGO SUBMARKET SNAPSHOT NORTH COOK COUNTY SOUTH COOK COUNTY DUPAGE COUNTY LAKE COUNTY Existing Units 244,775 75,248 66,171 37,059 Occupancy 96.0% 95.0% 95.3% 96.3% Annual Change +0.7% +0.5% -1.0% +0.8% Avg. Monthly Rent $1,137 $916 $1,124 $982 Avg. Monthly Rent Per Square Foot Annual Inventory Change 2014 Occupancy Forecast $1.33 $1.09 $1.26 $1.15-0.1% +0.5% +1.6% +0.1% 96.0% 95.1% 95.5% 96.3% Source: MPF Research COLLIERS INTERNATIONAL P. 12

TRANSACTION VOLUME Few core assets were placed on the market in 2013 despite strong investor demand for downtown Chicago multi-family properties. Overall sales volume for the city rose 19 percent with most transactions concentrated in the Lakeview, Rogers Park, and South Shore neighborhoods. Highlights for the year include the sale of the 250-unit 1225 Old Town to Heitman from Northwestern Mutual for $165.9 million, translating to a record breaking $627,626 per unit. 2013 LARGE MULTI-FAMILY INVESTMENT SALE TRANSACTIONS DOWNTOWN CHICAGO 1225 OLD TOWN SOLD FOR $627,626 PER UNIT DATE PROPERTY UNITS TOTAL PRICE ($) PRICE PER UNIT ($) CAP RATE Sale Pending 2555 N. Clark 162 $53,000,000 $327,160 Sub 5% 12/10/2013 The Belden-Stratford 2300 N. Lincoln Park West 12/5/2013 Reside Ravenswood 4543 N. Dover St. 10/15/2013 The Lex 2138 S. Indiana Avenue 10/10/2013 Mondial Apartments 910 W. Huron Street 9/4/2013 Kingsbury Plaza 520 N. Kingsbury Street 8/30/2013 York Terrace 2701 S. Indiana Avenue 7/25/2013 West Argyle Apartments 1338-1354 W. Argyle Street 6/5/2013 1225 Old Town 1225 N. Wells Street 4/4/2013 777 South State 2 East 8th Street 2/12/2013 Old Town Apartments 227-245 W. North Avenue 297 $86,750,000 $292,088 4.78% 150 $13,000,000 $86,667-332 $120,328,655 $362,436-141 $57,500,000 $407,801 5.25% 420 $84,634,000 $201,510-331 $28,491,000 $86,076 6.50% 62 $8,200,000 $132,258-250 $156,906,500 $627,626-330 $58,500,000 $177,273 6.32% 54 $8,000,000 $148,148 CAPITALIZATION RATES The average capitalization rate for Chicago through the fouth quarter of 2013 was 6.5 percent as reported by Real Capital Analytics. Cap rates are expected to remain in a very tight range through 2017 and remain compressed despite interest rate uncertainty in the capital markets. HISTORICAL MARKET PERFORMANCE Volume $ (mil) No. of properties Total units Price $/unit Avg Cap Rate past 12 mos. Q4 13 past 12 mos. Q4 13 past 12 mos. Q4 13 past 12 mos. Q4 13 past 12 mos. Q4 13 CHICAGO METRO AREA UNITED STATES ACTUAL CHG VS PRIOR ACTUAL CHG VS PRIOR $2,219.60 $693.40 124 36 17,191 5,473 $135,172 $113,218 6.80% 6.50% 4% 36% 33% 16% 21% 12% -15% -11% 43 bps unch $102,111.30 $30,214.90 5,750 1,819 929,052 295,532 $113,180 $120,074 6.20% 6.20% 17% 41% 7% 27% 9% 34% 3% 12% 2 bps -9 bps Source: Real Capital Analytics P. 13 COLLIERS INTERNATIONAL

Q4 2014 FORECAST BY SUBMARKET SUBMARKET ANNUAL DEMAND OCCUPANCY ANNUAL OCCUPANCY CHANGE ANNUAL SUPPLY Chicago 4,201 95.0% 0.00% 4,423 The Loop 1,212 90.3% -2.80% 1,938 Streeterville/River North 747 93.0% 0.30% 709 Lincoln Park/Lakeview 174 97.2% -0.40% 424 Southeast Chicago 570 94.0% 0.50% 96 South Cook County 70 95.1% 0.10% 0 North Cook County 425 96.3% 0.10% 292 Arlington Heights/Palatine/ Mount Prospect 129 96.1% -0.30% 214 Schaumburg 33 95.7% 0.20% 0 North DuPage County 167 95.4% 0.90% 0 Central DuPage County 258 96.0% -0.20% 306 Southeast DuPage County 19 96.0% 0.10% 0 EMPLOYMENT According to the Bureau of Labor Statistics, the metropolitan Chicago area added 60,300 jobs during the year-ending November 2013, which was a 1.4% increase in the employment base. The professional and business services sector accounted for 28,600 jobs which was nearly half of Chicago s recent job growth. Employment is expected to pick up in 2014 and MPF Research has forecast that some 70,000 jobs will be added in the metropolitan Chicago area in 2014 which would expand the employment base by 1.6 percent. This increase in labor would bring the metro s overall employment to nearly 96,000 jobs ahead of the first quarter 2008 level. This level of growth would be significant as it would mean the metro would have successfully recouped all jobs lost to the recession and therefore has begun to expand. COLLIERS INTERNATIONAL P. 14

Retail THE BIG PICTURE While core properties and single tenant retail continued to dominate the retail investment marketplace throughout 2013, a notable rebound in prices occurred across the entire retail investment spectrum throughout the year. Investors appeared to re-embrace the sector in 2013, as was particularly evident in the marked increase in un-anchored strip center sales as well as a resurgence of activity throughout higher yielding secondary and tertiary markets. Sales of retail properties nationally totaled $60.8 billion in 2013, up 8 percent from 2012, and were paced by the increased sales of strip centers as well as the continuously-active single-tenant marketplace. A common trend throughout the investment markets in 2013 was the outperformance of property types and markets that had previously experienced a weakened recovery. In the retail sector specifically, the standout in terms of increasing sales volume was un-anchored strip centers, where volume surged 26 percent and prices spiked by 27 percent year-over-year. That asset class may even have greater upside, as prices still remain 32 percent below peak pricing levels in 2006 and 2007. 2013 was also a year that saw investors become less risk-averse and begin to pursue properties in markets that had previously lagged in the recovery. Correspondingly, volume in the non-major metros grew 23 percent year-over-year in 2013. CAPITALIZATION RATE COMPRESSION Cap rate compression continued throughout 2013 for single-tenant retail properties, ending the year at an average cap rate of 6.8 percent across all tenants nationally. Cap rates for strip centers also experienced a slight decrease throughout the year, registering a 17 bps decrease and ending the year at 7.4 percent. It should be noted that average cap rates for strip centers are impacted by opportunistic and value-add investors chasing higher yield. On the whole, average cap rates across all retail property types declined by approximately 20 bps in 2013, ending the year at 7.0 percent. P. 15 COLLIERS INTERNATIONAL

2527 WEST GOLF ROAD HOFFMAN ESTATES, IL LEASING FUNDAMENTALS Many have noted that recent retail investment trends reflect a capital environment that has nearly fully recovered. Nevertheless, retail leasing fundamentals have only recently started to improve, if at all, as overall vacancy rates continue to ebb on a market-by-market basis. Moving forward, gradual improvements in leasing fundamentals, corresponding market stabilization, and finally the subsequent improvement in NOIs is what will ultimately contribute to price appreciation of retail property, as opposed to solely cap rate compression. Fortunately, in many markets limited new development will assist in the recovery of rents and occupancies. Chicago s overall retail vacancy rate ended 2013 just below 9 percent, remaining relatively flat throughout the year but registering a slight increase in the fourth quarter. Average quoted retail rental rates throughout Chicago also remained flat throughout the year, ending the fourth quarter at $15.81 per square foot (down 0.19% YOY). Some of the larger lease signings occurring throughout Chicagoland this year included: Brunswick Zone (80,425 SF renewal in Naperville, IL), Old Time Pottery (78,158 SF at 1935 N. Neltnor Blvd), and Mariano s Fresh Market (75,564 SF at Glen Gate). P. 16 COLLIERS INTERNATIONAL

CHICAGO: THE SECOND MOST ACTIVE RETAIL INVESTMENT MARKET IN THE U.S. Retail property prices on both coasts generally outperformed Midwestern and Southern markets in 2013. Regionally, the Midwest posted the weakest price appreciation for retail properties. However, with prices still 39 percent below peak levels, it is potentially poised for a long awaited rebound in 2014. Chicago specifically registered an 8 percent gain in retail sales volume YOY, leapfrogging Manhattan and ending the year as the second most active retail market in the United States, only behind Los Angeles. Total retail sales volume in Chicago in 2013 was $3.55 billion, just behind LA at $3.58 billion and ahead of Manhattan at $3.45 billion. Notably, Chicago was the only major metro of the top four retail investment markets in the United States to register year-over-year increases in sales volume. Los Angeles, Manhattan, and Dallas which round out the top four markets registered decreases of 2 percent, 36 percent, and 5 percent, respectively. CHICAGO S TOP RETAIL INVESTMENT SALES OF 2013 Chicago was home to four of the top 25 retail investment sales nationally in 2013. These sales were (by national rank): 2. Water Tower Place retail (Chicago, IL): $410,000,000 ($1,054 per square foot) 10. 830 N. Michigan Avenue (Chicago, IL): $166,000,000 ($1,317 per square foot) 15. Barney s New York (Chicago, IL): $154,500,000 ($1,627 per square foot) 21. Geneva Commons (Geneva, IL): 124,500,000 ($285 per square foot) Additional noteworthy Chicagoland retail investment sales in 2013 included: > > Woodfield Village Green (Schaumburg, IL) for $119,000,000 ($234 per square foot) > > Orland Park Place (Orland Park, IL) for $109,000,000 ($183 per square foot) > > Church Street Plaza (Evanston, IL) for $70,150,000 ($399 per square foot) > > Broadview Village Square (Broadview, IL) for $63,000,000 ($404 per square foot) > > BHLDN/Brioni (12 E. Walton, Chicago, IL) for $22,500,000 ($2,729 per square foot) > > Clybourn Galleria (Chicago, IL) for $11,750,000 ($469 per square foot) GENEVA COMMONS GENEVA, IL SOLD FOR $285 PER SQUARE FOOT WATER TOWER PLACE CHICAGO, IL SOLD FOR $1,054 PER SQUARE FOOT P. 17 COLLIERS INTERNATIONAL

CAPITAL FLOWS CHICAGO While total investment was up in 2013, the proportion of where those investment dollars came from changed in a few categories. The most noticeable decline was in institutional investment, which as a total percentage of investment decreased by 20%. The difference was made up for with increases in foreign and private investment. CAPITAL FLOWS Chicago BUYER TYPES United States 7% 12% 14% 9% 15% 16% 45% 25% 39% 46% 8% 34% 33% Cross-Border Institutional Public Listed/REITs Private User/Other 29% 43% 43% 33% 33% 17% 26% 6% 2010 2011 2012 2013 2013 (YTD) Rounded figures may not add up to 100% *Source: Real Capital Analytics LOOKING AHEAD: WHAT WE EXPECT IN 2014 Looking ahead to 2014, we expect more of the same. As investor demand cannot be met by a supplyconstrained market, cap rate compression will continue. We also expect investor focus to remain primarily bifurcated, with continued emphasis on either core or value-add (higher yield) opportunities. Moreover, if retailer performance is able to increase, we expect to see acceleration in rents, and therefore pricing increases as well additional cap rate compression. P. 18 COLLIERS INTERNATIONAL

Seniors Housing Although 2013 was a fairly robust year in terms of transactions of existing properties, the seniors industry experienced a significant transition from facility-based transactions to new development transactions. SENIORS HOUSING CLASSIFICATIONS Widely accepted definitions of Seniors Housing, from those with least amount of care and services to those requiring nursing care for residents, are Independent Living (IL), Assisted Living (AL), which might or might not include Memory Care (MC) dedicated units and Nursing Care (NC). IL Independent Living AL Assisted Living MC Memory Care NC Nursing Care LINCOLNWOOD PLACE CHICAGO, IL SOLD FOR $281,065 PER UNIT There were 21 transactions totaling $357,101,824 reported, 12 of which were dedicated Nursing Care (NC) facilities. NC sales of $159,873,606 represented 45 percent of total transaction volume. The Nursing Care provider industry is greatly tied to the Medicare and Medicaid reimbursable market. This reliance on government-based payments has resulted in the segment experiencing slippage in monthly rates and occupancies and therefore capitalization rates in excess of those in the primarily- Assisted Living segment. According to Integra Realty Resources (Market Trends 2014), the national range of cap rates for NC properties was 12-14 percent with primarily-al properties trading in the 6 to 8 percent range. Primarily-Assisted Living facility transactions experienced per unit values between $67,231 and $267,960, averaging $155,171. The newer facilities performed at the upper end of the range with that trend expected to continue. 2013 CHICAGO AREA TOP SALES TRANSACTIONS PROPERTY NAME/LOCATION Lincolnwood Place Chicago Forestview Rehabilitation & Nursing Itasca Pavilion Of Waukegan II Waukegan Park Pointe Morris Senior Living Morris Avalon Springs Health Campus Valparaiso International Village Chicago Embassy Care Center Wilmington Tower Hill Healthcare Center South Elgin Three Oaks Assisted Living Cary Evergreen Healthcare Center Evergreen Park Warren Barr Pavilion Chicago Westshire Nursing & Rehab Cicero Norridge Healthcare & Rehab Harwood Heights Sunrise of Gurnee Gurnee Sunrise of Schaumburg Schaumburg Sunrise of Naperville North Naperville Sunrise of Flossmoor Flossmoor Sunrise at Fountain Square Lombard Sunrise of Crystal Lake Crystal Lake Providence Healthcare & Rehab South Holland Berwyn Rehab and Care Center Berwyn TOTAL UNITS 299 144 109 142 132 208 171 206 80 242 271 485 292 60 82 77 62 142 58 356 145 BUYER SELLER Griffin American Healthcare REIT II Senior Lifestyle Corp Forest View Nursing Realty LLC First Chicago Bank & Trust Pavilion of Waukegan Realty LLC Extended Care Clinical LLC Feiner Investment Corp Morris Real Estate Holdings I LLC Trilogy Healthcare Services LLC HealthLease Properties REIT YAM Management LLC (IL) Daniel Rothner Trust YAM Management LLC (IL) Embassy Holdings LLC Tower Hill Property LLC Kane Street Property LLC Spectrum Retirement Communities Kimco Realty Corp Legacy Healthcare Financial Services First Investments Corp Legacy Healthcare Financial Services First Investments Corp Westshire Nursing Realty LLC Extended Care Clinical LLC Feiner Investment Corp Lancaster Health Group Health Care REIT CNL Financial Group (CNL) Health Care REIT CNL Financial Group (CNL) Health Care REIT CNL Financial Group (CNL) Health Care REIT CNL Financial Group (CNL) Health Care REIT CNL Financial Group (CNL) Health Care REIT CNL Financial Group (CNL) FNR Healthcare Group Providence Life Services Courtyard Realty At Berwyn LLC Fairfax Health Care Props LLC SALE DATE 12/15/2013 11/27/2013 11/1/2013 11/1/2013 10/25/2013 10/24/2013 10/16/2013 8/27/2013 8/12/2013 8/5/2013 8/5/2013 7/25/2013 7/16/2013 7/1/2013 7/1/2013 7/1/2013 7/1/2013 7/1/2013 7/1/2013 4/30/2013 1/3/2013 CLOSE PRICE PRICE PER UNIT $84,038,360 $281,065 $6,600,000 $45,833 $3,425,000 $31,422 $18,164,613 $127,920 $11,469,996 $86,894 $13,349,000 $64,178 $6,300,000 $36,842 $8,280,000 $40,194 $18,494,647 $231,183 $12,200,000 $50,413 $22,685,000 $83,708 $10,000,000 $20,619 $39,500,000 $135,274 $6,508,930 $108,482 $5,512,931 $67,231 $6,233,781 $80,958 $4,168,313 $67,231 $37,979,287 $267,460 $6,291,966 $108,482 $28,000,000 $78,652 $7,900,000 $54,483 P. 19 COLLIERS INTERNATIONAL

2013 CONSTRUCTION PLANNING PROJECT ADDRESS STAGE UNITS Renaissance at Prairie Crossing Senior Assisted Living Facility Route 137 & Peterson Road Grayslake Planning 204 Assisted Living Facility 3053 W. Franklin Boulevard Chicago Pre-Planning Senior Assisted Living Facility - Design/Build Quentin Rd & NW Highway Palatine Planning 75 S.Suburban Supportive Living Chicago Heights, IL 1040 Dixie Highway Chicago Heights Planning 144 Northbrook Manor Senior Assisted Living Facility Founders Dr & Kamp Drive Northbrook Planning 87 Executive Plaza Senior Housing Building w/activity Center 225 W Touhy Avenue Park Ridge Planning 50 Heritage Woods of Wheaton Assisted Living Facility 219 Parkway Drive Wheaton Planning 84 Aurora Memory Care Assisted Living Facility 1340 River Street Aurora Planning 49 Priory Estates Senior Living Facility 5820 151st Street Oak Forest Planning 110 North Shore Place Memory Care Building (Phase 3) 1000 Sunset Ridge Road Northbrook Planning 76 Hampstead Court Assisted Living Facility Wheeler Rd & Route 47 Sugar Grove Planning 150 Hospice Care Facility (Master Report) Summit St &Indiana Avenue Crown Point, IN Pre-Planning 78 Autumn Leaves Memory Care Gurnee Arlington Heights Planning NORTH SHORE PLACE NORTHBROOK, IL 76 PLANNED UNITS Memory Care Alzheimer's Care Facility Journey Senior Living at Grayslake Woodbine & Milwaukee Ave Vernon Hills Route 45 & 120 Grayslake Planning 66 Planning 84 Autumn Leaves of South Barrington Memory Care 215 Bartlett Road Barrington Planning 46 Woodstock Assisted Living Facility Calhoun & Tryon Street Woodstock Pre-Planning 56 Memory Care Facility 7800 Rhode Island Street Merrillville, IL Planning 50 Artis Assisted Living Facility & Parking Garage 3535 N Ashland Avenue Chicago Planning 118 Supportive Living Facility Hunt Club Road Gurnee Pre-Planning 120 Deer Grove Memory Care Design/Build 896 N Quentin Road Palatine Planning 69 North Shore Assisted Living Dementia Care Facility (Phase 2) 1000 Sunset Ridge Road Northbrook Planning 32 Uptown Supportive Living 5019 N Winthrop Avenue Chicago Planning 246 Lombard Assisted Living & Memory Care Facility 300 W 22nd Street Lombard Bidding 80 Solana Assisted - Independent Living and Parking Garage 21840 West Lake Cook Rd Deer Park Underway 180 Lee Street Assisted Living Facility 959 Lee Street Des Plaines Pre-Planning 60 Caledonian House Assisted-Living Residence 3000 Des Plaines Avenue Riverside Pre-Planning 103 Supportive Living Facility 2400 Lacey Road Downers Grove Bidding 100 Autumn Leaves Memory Care (Glen Ellyn) Geneva & Blomingdale Road Glen Ellyn Final Planning 40 P. 20 COLLIERS INTERNATIONAL

ELDERLY ADULTS AS A SHARE OF THE U.S. POPULATION 2000-2050 25% 20% 15% 10% 5% 0% 1.5% 4.3% ELDERLY ADULTS AS A SHARE OF THE U.S. POPULATION 1.8% 4.2% 6.5% 7.1% Baby Boomers Start Turning 65 2.3% 6.9% Baby Boomers Start Turning 85 Ages 85 or Older Ages 75 to 84 10.5% Ages 65 to 74 2000 2010 2020 2030 2040 2050 Source: Congressional Budget Office tabulations based on population projections reported in The 2012 Long-Term Budget Outlook (June 2012). www.cbo.gov/publication/43288. Note: Members of the baby-boom generation (people born between 1946 and 1964) started turning 65 in 2011 and will turn 85 beginning in 2031. ACTIVE INVESTORS Nationally, this segment has been dominated by publicly traded and privately held REITs. In the Chicago market, the 2013 activity was in excess of $150,000,000, controlled by REITs. It should be noted that two transactions accounted for approximately $112,000 of this volume. This factor is not lost on the capital markets focused on the seniors housing industry. Recognizing the dearth of Class A or B primarily-assisted Living properties, the capital markets, dominated by national REITs, have begun to infuse the investment market with capital for ground-up facility development. In most instances, they have directed their favored Operating Partners to locate appropriate sites for development in prime markets throughout the country, Chicago among the most prime. Senior living developers and providers such as Silverado, Spectrum, South Bay Partners, Artis, Randall Residence and Autumn Leaves have proceeded with significant new acquisitions for the purpose of developing new Assisted Living and Memory Care facilities in prime suburban Chicago markets. Chicago-based senior providers have been aggressive as well with Senior Lifestyle and Pathway, among others, undertaking expansion/development programs. According to NIC MAP, the leading research resource of senior housing data, this trend will increase based on several factors. The first Baby Boomers turned age 65 in 2011, with an additional 10,000 Boomers each day or 360,000 annually. Unlike their predecessors, these Boomers stay active longer, with better health and eventually look for some form of senior housing as they age, closer to home. The desire to be near family, friends and the communities they have grown with, has guided their search in the same markets they have resided in for many years. The growth and development of senior housing facilities is primarily a suburban based phenomenon. This is based on the availability of suitable development sites and the nature of demographics/economics in wider trade areas in the suburbs. ANNUALIZED TOTAL RETURNS 18 16 14 Percent 12 10 8 6 Seniors Housing Apartment Retail Industrial Office Total 4 2 0 1 Year 3 Years 5 Years 8 Years Source: AEW Research, NCREIF P. 21 COLLIERS INTERNATIONAL

SUPPLY AND DEMAND Development of senior housing facilities is based on need-driven economics. Developers and their financial resources determine the senior housing need of a trade area, taking into consideration existing facilities and those in planning and development, resulting in a definable number of the size facility and anticipated performance. As of fourth quarter 2013, there were 27 new developments in planning, accounting for approximately 2557 units. Senior housing developers and investors have identified private pay Assisted Living as the focus of new development. Most seniors are able to age in place in their early Boomer years with the average age of Assisted Living residents in the low- to mid-80s Chicago-based based Assisted Living facilities averaged 87.6 percent stabilized occupancy with an average rent of $4,486 monthly. Most Class A newer facilities are approaching 90 percent occupancies with even higher rents for Levels of Care fees. Unlike many other asset classes, this self-limiting factor has kept the investment potential of senior housing from out-performing Apartment, Retail, Industrial and Office segments over the last one, five and eight-year periods. Senior housing is not as cyclical by nature and is driven by a population component that will fuel its demand for many years to come. According to NIC data, there were 115 properties, comprising 10,547 AL units in the Chicago market, in the fourth quarter of 2013. With the properties already in the pipeline, there is significant capacity to approach that number, albeit the new projects will be primarily Assisted Living focused with Memory Care components in many instances. Limiting factors, in addition to the avoidance of unit duplication in a submarket, will be the availability of appropriate sites for new construction and the willingness of certain municipalities to have further senior housing development on land zoned for more intense uses. The availability of abundant capital for new development, the high occupancy rates and rental rates of existing facilities and the downward pressure on existing facility cap rates will all foster continued strong and sustainable growth of new senior housing properties through 2016. 2013 INVENTORY QUARTER # PROPERTIES # UNITS OCCUPANCY STABILIZED OCCUPANCY ABSORPTION INVENTORY GROWTH # PROPERTIES UNDER CONSTRUCTION # UNITS UNDER CONSTRUCTION ANNUAL RENT GROWTH AVG RENT 1Q2013 111 10,255 83.7% 85.6% -40 90 10 820 1.7% $4,445 2Q2013 112 10,398 83.5% 85.7% 91 143 9 676 2.3% $4,456 3Q2013 113 10,443 84.9% 87.6% 185 45 9 676 2.7% $4,485 4Q2013 115 10,547 85.0% 87.6% 100 104 7 568 2.2% $4,486 1Q2013 212 35,221 84.5% 85.7% 158 169 13 935 1.9% $3,231 2Q2013 213 35,407 84.4% 85.7% 135 186 12 872 1.1% $3,238 3Q2013 215 35,509 85.1% 86.5% 319 102 11 814 0.6% $3,244 4Q2013 217 35,607 86.0% 87.1% 397 98 9 706 0.8% $3,252 P. 22 COLLIERS INTERNATIONAL

RESEARCH REPORT Q4 2013 CHICAGO INVESTMENT 482 offices in 62 countries on 6 continents > $2.0 > 979 billion in annual revenue million square feet under management > Over 13,500 professionals @ColliersChicago CONTACTS: Office Tony Smaniotto, Executive Vice President tony.smaniotto@colliers.com Industrial Steve Disse, Principal steve.disse@colliers.com Multi-Family Brian Pohl, Executive Vice President brian.pohl@colliers.com Retail Peter Block, Executive Vice President peter.block@colliers.com Seniors Housing Jeff Hyman, Senior Vice President jeff.hyman@colliers.com Accelerating success. www.colliers.com/marketname