Las Vegas Economic Review. Las Vegas Research & Forecast Report Q1 2017

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1 Las Vegas Research & Forecast Report Q Las Vegas Economic Review 1 Las Vegas Research & Forecast Report Q Economic Review Colliers International

2 Glossary Industrial Definitions Incubator: Multi-tenant buildings without dock-high loading doors that have a parking ratio lower than 3.5/1,000 square feet and bay sizes lower than 3,500 square feet. Light Distribution: Multi- or single-tenant buildings that include dock-high loading doors and have bay sizes of less than 15,000 square feet. Light Industrial: Multi- or single-tenant buildings without dock-high loading doors that have a parking ratio lower than 3.5/1,000 square feet and, in the case of multi-tenant buildings, bay sizes of at least 3,500 square feet. Flex: Warehouse/Distribution: Multi- or single-tenant buildings without dock-high loading doors with parking ratios in excess of 3.5/1,000 square feet. Multi- or single-tenant buildings that include dock-high loading doors and have bay sizes of at least 15,000 square feet. Office Definitions Class A Office: Class B Office: Class C Office: Buildings with steel frame construction, high end exterior finish, distinctive lobbies featuring upgraded finishes, amenities including on-site security, state-of-the-art communications and data infrastructure and covered parking. Class A buildings are usually multi-story. Buildings with steel frame, reinforced concrete or concrete tilt-up construction. Class B buildings contain common bathrooms and hallways, and their lobbies may have granite and hardwood detailing. Class B buildings are often multi-story. Buildings of wood frame construction. Class C buildings are often garden-style and are built around courtyards. Retail Definitions Community Center: Neighborhood Center: Power Center: Strip Center: Retail centers anchored by supermarkets, drug stores and discount department stores. Tenants include offprice retailers selling apparel, home improvements/furnishings, toys, electronics or sporting goods. Retail centers anchored by supermarkets and drug stores. Neighborhood centers are intended for convenience shopping for day-to-day needs of consumers. Retail centers dominated by several large anchors including discount department stores, off-price stores, warehouse clubs or category killers. Power centers generally inline space. Unanchored retail centers that are 20,000 SF in size or larger. Multifamily Definitions Class A Multifamily: Class B/C Multifamily: Buildings constructed in the last 5 years Buildings constructed more than 5 years ago General Definitions Vacant SF: Sublease SF: Net Absorption: Space in a building that is unoccupied and offered for lease by the owner of the company. Space in a building that is offered for sublease by the primary tenant. This space may or may not be occupied. Difference in occupied square footage from one period to another. 2 Las Vegas Research & Forecast Report Q Economic Review Colliers International

3 Table of Contents Economic Review The Expansion Continues With the Great Recession finally well behind us, Southern Nevada s economy is moving into expansion mode that should last through 2017 and 2018 barring a national recession. Industrial Review Boom! Southern Nevada has been threatening a construction boom for a few years now, and in 2017 that boom arrived. 4 8 Office Review Office Shines On Southern Nevada s office market just keeps on keeping on. Not as dramatic as the industrial market, the office market managed to record yet another quarter of recovery in the first quarter of Retail Review Retail Slows but Does Not Stop The retail market hit another bump in the road in the first quarter, with negative net absorption brought about by the closure of some large anchor locations. Multifamily Sales Strong in 2016 According to statistics provided by REIS, multifamily vacancy in Southern Nevada decreased in the fourth quarter of 2016 (the most recent quarter of available data) to 3.2 percent. Medical Office Future Uncertain Ask Again Later Southern Nevada s medical office market posted a fourth straight quarter of positive net absorption in the first quarter of 2017, which would be better news if this positive net absorption had also led to lower vacancy rates. Hospitality Hospitality Firing on All Cylinders After strong numbers in 2016, Southern Nevada s hospitality market posted growth in most areas in January 2017, but saw only light sales in the first quarter of Land Slow but Solid Start to 2017 The first quarter of 2017 saw land sales decrease, compared to a quarter ago and compared to one year ago This report and other research materials may be found on our website at This quarterly report is a research document of Colliers International Las Vegas. Questions related to information herein should be directed to the Research Department at Information contained herein has been obtained from sources deemed reliable and no representation is made as to the accuracy thereof. Colliers International 3 Las Vegas Research & Forecast Report Q Economic Review Colliers International

4 Research & Forecast Report LAS VEGAS ECONOMIC REVIEW Q The Expansion Continues With the Great Recession finally behind us, Southern Nevada s economy is moving into expansion mode that should barring a national recession last through 2017 and Unemployment in the Las Vegas-Paradise MSA stood at 5.1 percent as of January 2017, down from 6.5 percent in January The national unemployment figure was 4.8 percent in January 2017, down from 4.9 percent in January The national labor force participation rate increased to 63.0 percent in February 2017, 0.2 points higher than in February Recovery Index (Year -Over-Year) Clark County Economic Data Year Ago Current Jobs (1000s) (Jan 2017) The Old Growth Rate Visitor Volume YTD (Jan 2017) 3.47 MM 3.51 MM Gaming Revenue YTD (Jan 2017) $0.8 BB $0.9 BB The New Growth Rate Taxable Sales YTD (Dec 2016) $38.6 BB $39.9 BB Commercial Occupancy (Q1-17) 90.9% 91.0% 60.0 Nov 2016 Jun 2016 Jan 2016 Aug 2015 Mar 2015 Oct 2014 May 2014 Dec 2013 Jul 2013 Feb 2013 Sep 2012 Apr 2012 Nov 2011 Jun 2011 Jan 2011 Aug 2010 Mar 2010 Oct 2009 May 2009 Dec 2008 Jul 2008 Feb 2008 Sep 2007 Apr 2007 Nov 2006 Jun 2006 Jan 2006 Aug 2005 Mar 2005 Oct 2004 May 2004 Dec 2003 Jul 2003 Feb 2003 Sep 2002 Apr 2002 Nov 2001 Jun 2001 Jan 2001 Aug 2000 Mar 2000 Oct 1999 May 1999 Dec 1998 Jul 1998 Feb 1998 Sep 1997 Apr 1997 Nov 1996 Jun 1996 Source: The Center for Business & Economic Research, UNLV; Colliers International

5 Since January 2016, total employment in Southern Nevada increased by 19,400 jobs, slightly less than the 21,500 jobs that were added between January 2015 and January Employment Change (July July 2016) On a year-over-year basis, the majority of new jobs created in Southern Nevada were in professional and business services (+10,900 jobs), leisure and hospitality (+10,300 jobs), other services (+5,800 jobs), financial activities (+5,500 jobs) and construction (+4,300 jobs). Other sectors experiencing job growth were education and health services (+1,900 jobs), information (+900 jobs), government (+600 jobs), and manufacturing (+300 jobs). Three sectors saw job losses over the period; wholesale (-100 jobs), transportation and warehousing (-800 jobs), and retail (-2,100 jobs). While the current construction employment of 57,600 jobs lags well behind the 111,300 construction jobs the Valley had in August of 2006, it has expanded quite a bit since the low of 34,800 construction jobs in early The industrial and multifamily sectors continue to be the key real estate stimulators of new construction in the Valley, though infrastructure really remains the king in terms of construction job creation in Southern Nevada. Important infrastructure projects are planned to continue for the next year at least, Project Neon being foremost among them. The coming years will also see construction of new master-planned communities in Henderson, the Northwest and North Las Vegas, the ResortsWorld resort on the Las Vegas Strip and well as additional industrial and multifamily projects. Southern Nevada Commercial Real Estate Recovery Index (Year-Over-Year) Jan 2005 = 100 Population growth, a key driver of Southern Nevada s economy for the past century, may be improving. According to data provided by the Nevada Department of Motor Vehicles, the average number of out-ofstate driver s licenses turned in each month was 5,130 in saw that average improve to 5,773 per month, higher than the last peak of 5,481 per month experienced in While this is still well below levels seen in the years prior to the Great Recession, it is a welcome improvement. The Valley s improving job market might be the key factor in this increase in immigration into Southern Nevada New Home Sales Commercial Occupancy Gaming Visitor Volume In-Migration Employment Taxable Sales Port Traffic LA Recovery Index Revenue Dec 2015 Dec 2016 New home sales in the post-recession period have been slowly improving over the past three years, though they remain below the post-recession peak monthly average of 763 home sales per month in August New home sales in 2016 averaged 633 homes per month, and January of 2017 saw 527 sales, an improvement over January of The median price for new homes has been on the rise over the past three years, and this might be partially to blame for the sales levels remaining lower than we would like to see. Home sellers cannot generate the profits they need at lower prices, and Southern Nevada buyers are finding these higher prices difficult to pay. As a result, existing home sales have been stronger than new homes sales over the past three years, and occupancy of multifamily properties has been more impressive yet, leading to the recent boom in multifamily development. 5 Las Vegas Research & Forecast Report Q Economic Review Colliers International

6 Visitor volume and gaming revenue continued to improve in Southern Nevada in 2016, and was higher than in A lack of hotel room inventory expansion in 2017 might mean that visitor volume will remain high, but will not see major increases this year. Gaming revenue in 2016 was higher than in 2015 by a small margin. Diversification of entertainment in the Strip resorts has made gaming revenue less important now than it was in past decades, but it still remains a key sector in Southern Nevada s economy. Commercial real estate (i.e. industrial, office and retail) investment sales volume in 2016 reached $1.13 billion in 234 sales totaling 8.1 million square feet at an average price per square foot (ppsf) of $ This was down slightly from So far, 2017 has seen 59 sales with sales volume of $572.7 million dollars. Sale volume growth (year-over-year) in 2016 was 24.1 percent for industrial properties. Sales volume growth was negative 43 percent for single-tenant retail properties, negative 29 percent for shopping centers and negative 28.1 percent for office properties in Recovery Index The recovery index saw a small dip in January 2017 from December 2016, a not uncommon occurrence for the index in the winter months. The index peaked at in November 2016 before beginning its two month slide. This winter s slide is more mild than in past years, and hopefully presages a strong spring. Five measures of the economy in the recovery index have fully recovered to (or beyond) their 2005 levels, those being gaming revenue, visitor volume, employment, taxable sales and port traffic in Los Angeles (a minor component to the index). Commercial occupancy was nearly back to 2005 levels last quarter, but high levels of industrial construction caused that measure to step back in the first quarter of New home sales lag well behind 2005 levels, despite great improvement in 2016, and in-migration into Southern Nevada is at about 85 percent of levels seen in Las Vegas Research & Forecast Report Q Economic Review Colliers International

7 Economic Statistics Las Vegas First Quarter 2017 TYPE JANUARY-17 SEPTEMBER-16 JANUARY AVERAGE 2016 AVERAGE QUARTERLY GROWTH ANNUAL GROWTH 2016 TO 2017 GROWTH (AVERAGE) EMPLOYMENT DATA U.S. Employment 145,798, ,747, ,318, ,680, ,324, % 1.7% 0.9% U.S. Unemployment Rate 4.8% 5.0% 4.9% 4.8% 4.9% -4.0% -2.0% -2.4% Las Vegas MSA 939, , , , , % 2.1% 1.9% Employment Las Vegas MSA 5.1% 5.6% 6.5% 5.1% 6.0% -8.9% -21.5% -14.3% Unemployment Rate Las Vegas MSA 57,600 59,700 53,300 57,600 57, % 8.1% -0.3% Construction Employment Las Vegas MSA Hospitality Employment 286, , , , , % 3.7% 0.9% HOUSING/CONSTRUCTION DATA New Home Sales % 38.0% -20.5% New Home Median Price $329,574 $322,768 $309,177 $329,574 $322, % 6.6% 2.2% Existing Home Sales 2,144 2,927 1,879 2,144 2, % 14.1% -20.5% Existing Home Median Price $238,000 $233,500 $219,000 $238,000 $229, % 8.7% 3.6% Residential Permits , % 31.6% -15.3% Residential Permit Value $135,970,768 $105,429,933 $105,098,335 $135,970,768 $131,855, % 29.4% 3.1% Commercial Permits % 39.1% -0.8% Commercial Permit Value $43,285,289 $37,791,405 $34,404,001 $43,285,289 $55,713, % 25.8% -22.3% HOSPITALITY DATA Visitor Volume 3,508,834 3,657,797 3,471,734 3,508,834 3,602, % 1.1% -2.6% Gaming Revenue $926,169,000 $808,829,000 $810,532,000 $926,169,000 $809,399, % 14.3% 14.4% Room Inventory 149, , , , , % 0.1% 0.0% Hotel/Motel Occupancy 85.7% 92.9% 84.7% 85.7% 89.1% -7.8% 1.2% -3.9% Passengers (McCarran Int'l 3,676,329 4,053,362 3,551,697 3,676,329 3,952, % 3.5% -7.0% Airport) Convention Attendance 736, , , , , % -4.1% 40.0% The information contained in this report was provided by sources deemed to be reliable, however, no guarantee is made as to the accuracy or reliability. As new, corrected or updated information is obtained, it is incorporated into both current and historical data, which may invalidate comparison to previously issued reports. 7 Las Vegas Research & Forecast Report Q Economic Review Colliers International

8 Research & Forecast Report LAS VEGAS INDUSTRIAL Q Boom! > > Demand for industrial space remained steady in the first quarter of 2017 Economic Indicators > > Industrial development exploded, adding over 2.0 million square feet to inventory > > This drove vacancy up to 6.1 percent from last quarter s 5.2 percent INDUSTRIAL Employment RESIDENTIAL Permit Value TRANSPORTATION Taxable Sales Southern Nevada has been threatening a construction boom for a few years now, and in 2017 that boom arrived. This quarter saw the completion of over 2.2 million square feet of new industrial projects, and the remainder of 2017 should see inventory expand by an additional 6.8 million square feet or more. New developments sent vacancy up to 6.1 percent from last quarter s 5.2 percent, a large increase that will probably be repeated through the remainder of the year. The weighted average asking rate decreased to $0.63 per square foot (psf) on a triple net (NNN) basis, a $0.04 decrease from last quarter driven in part by the completion of all that warehouse/distribution space, but also by draw-downs in asking rates in the light distribution, light industrial and incubator sectors. Southern Nevada s industrial job market improved in January 2017 (the latest month of data available) compared with January 2016, adding only 3,700 jobs in sectors usually associated with industrial real estate in the past +5.4% -13.8% Market Indicators Relative to prior period Q Q2 2017* Vacancy Net Absorption Completions Rental Rate *Projected Summary Statistics Las Vegas Market Q1-16 Q4-16 Q1-17 Historical Vacancy Rates and Asking Lease Rates Vacancy Rate 5.7% 5.2% 6.1% 7.0% 6.0% 5.0% $0.68 $0.66 $0.64 $0.62 Asking Rent (PSF, NNN) $0.65 $0.67 $0.63 Net Absorption (SF) 878, ,541 1,106, % 3.0% 2.0% 1.0% 0.0% 1 Q Q Q Q Q Q Q Q 2015 $0.60 $0.58 $0.56 $0.54 $0.52 $0.50 $0.48 Vacancy Asking Rental Rate We think demand will remain steady through 2017, and by 2018 vacancy rates will begin to decrease. New Completions (SF) 1,104, ,320 2,265,340 Overall Asking Rents Per Square Foot Warehouse/Distribution $0.52 $0.54 $0.52 Light Distribution $0.58 $0.64 $0.63 Light Industrial $0.69 $0.73 $0.70 Incubator $0.73 $0.84 $0.82 Flex $0.94 $0.85 $0.88

9 twelve months, including 4,300 jobs in the construction sector. The transportation & warehousing sector lost 800 jobs over the past twelve months, which is not a welcome figure considering the large amount of warehouse/distribution product now being completed and under construction in Southern Nevada. The manufacturing sector added 300 jobs and the wholesale sector lost 100. Unemployment in the Las Vegas-Paradise MSA stood at 5.1 percent as of January 2017, down from 6.5 percent in January From January 2016 to January 2017, total employment in Southern Nevada has increased by 37,500 jobs. Historical Net Absorption vs. Completions 2,500,000 2,000,000 1,500,000 1,000, ,000 Southern Nevada s industrial inventory expanded by over 2.2 million square feet in the first quarter of 2017, putting the Valley on pace to add 9.9 million square feet of industrial space to inventory this year. Projects under construction are approximately 62 percent preleased or build-to-suit. Inventory growth of this magnitude has not been seen since the boom years of , and the increase in vacancy this quarter shows that it is already having an effect. 0 2 Q Q 2015 Net Absorption 4 Q Q Q Q 2016 Completions 4 Q Q 2017 The race is now on to absorb 8.1 million square feet of new industrial space entering the Southern Nevada industrial market in At current rates of absorption, vacancy should be sitting at approximately 8.6 percent by the end of the year, assuming the economy neither speeds up nor slows down appreciably. Fortunately, net absorption remained positive in the first quarter, extending the streak of positive net absorption that started in the fourth quarter of Gross absorption was 3.9 million square feet in the first quarter of 2017, higher than the gross absorption of 2.8 million square feet recorded in the first quarter of Occupancy vs. Industrial Employment 166, , , , , , , , , % 98.0% 96.0% 94.0% 92.0% Net absorption was positive in six of the Valley s seven submarkets this quarter. The highest net absorption was in Henderson (563,286 square feet), followed by North Las Vegas (258,707 square feet) and Southwest (168,331 square feet). Negative net absorption occurred in Northwest (negative 19,494 square feet). 148, , ,000 2 Q Q Q 2015 Industrial Jobs 1 Q Q Q Q 2016 Occupancy Rate 1 Q % 88.0% Vacancy increased this quarter to 6.1 percent, a 0.9-point increase from one quarter ago, and a 0.4-point increase from one year ago. As mentioned above, we expect vacancy to continue to increase in 2017 due to the high rate of industrial development taking place, provided demand for warehouse/distribution does not surge to levels last seen during the boom of 2006/2007. The Valley s highest vacancy rate is in the small Northwest submarket, at 8.2 percent, followed by Henderson with 7.6 percent vacancy. East Las Vegas, which is not currently experiencing new industrial development, had the lowest vacancy rate, 4.8 percent, followed by 4.9 percent vacancy in the Southwest submarket, which is seeing moderate levels of new development. JAN 2016 JAN 2017 CHANGE Construction 53,300 57, ,300 Manufacturing 21,900 22, Transportation & Warehousing 40,000 39, Wholesale 21,800 21, Source: Nevada Department of Employment, Training and Rehabilitation The industries most active in occupying industrial space in 2016 were involved in the transportation and warehousing, retail trade and professional and business services sectors. Local companies took about 54 percent of the leased square footage we tracked over this period. Companies headquartered in the Southwest U.S. (including California) took 13.0 percent, 10.0 percent of leasing came from the Southeastern States, and companies from the Great Plains and Mid-Atlantic states took about 8.0 percent each. Out of state companies took a larger percentage of space in Las Vegas Research & Forecast Report Q Industrial Colliers International

10 The weighted average asking lease rate for industrial space increased this year to $0.63 psf NNN. This was $0.02 lower than one year ago. If adjusted for inflation, the weighted average asking lease rate is $0.45 psf NNN, a $0.03 decrease from one year ago. The current asking rate, adjusted for inflation, is $0.06 lower than it was during the Valley s last economic recovery period in Units leased in the first quarter of 2017 had effective lease rates that averaged percent of asking rates, a slight dip from 2016 s average of percent. In the first quarter of 2017, industrial investment sales volume was $64.1 million in 10 sales totaling 710,000 square feet. This is an improvement over the first quarter 2016, but is down compared to the first quarter of Average sales price per square foot this quarter was $90.34, a decrease from 2016 s average of $ The average cap rate was 7.1 percent in the first quarter of 2017, down from 7.2 percent in Southern Nevada s industrial market had over 1.1 million square feet of product marketed for sale as investments at the end of the year, with an average asking price of $ psf, and an average cap rate of 7.0 percent. The word on the street (or in the cubicles) in 2016 was that what Southern Nevada needed was large contiguous industrial spaces. Well, in 2017 we have them in spades. The story this year and next will be the draw down in warehouse/distribution vacancy, which spiked to 6.6 percent this quarter from 4.7 percent one year ago. Net absorption of warehouse/distribution was 862,365 square feet in the first quarter of 2017, an improvement over the average of 648,455 square feet of quarterly net absorption in It is easy to lose track of the light distribution market, given the current goings-on in the warehouse/distribution sector, but the plucky little buddy of warehouse continued to improve in the first quarter of Net absorption was 179,532 square feet, 1 Using the Consumer Price Index, All Urban Consumers, West Region, Class A Cities, = 100 Industrial Development Schedule Project Type STATUS Submarket Size Pre-Leasing 2nd Quarter ,826,045 SF 33% 3730 Civic Center Dr Warehouse/Distribution UC North Las Vegas 90,000 SF 100% CJ Pony Parts BTS Warehouse/Distribution UC North Las Vegas 80,000 SF BTS Copper Sage Commerce Center Warehouse/Distribution UC North Las Vegas 91,200 SF 0% Las Vegas Digital Exchange Campus Bldg 9 Warehouse/Distribution UC Henderson 295,000 SF 68% LogistiCenter at Las Vegas Blvd Warehouse/Distribution UC Southwest 546,480 SF 0% Lone Mountain Corporate Center Phase 2 Warehouse/Distribution UC North Las Vegas 247,122 SF 0% Sunrise Distribution Center Bldg 9 Warehouse/Distribution UC North Las Vegas 342,243 SF 0% Sunset 215 West Bldg 1 Warehouse/Distribution UC North Las Vegas 35,000 SF BTS Sunset 215 West Bldg 2 Warehouse/Distribution UC Southwest 22,500 SF 0% Sunset 215 West Bldg 3 Warehouse/Distribution UC Southwest 22,500 SF 0% Sunset Landing Warehouse/Distribution UC Southwest 54,000 SF 100% 3rd Quarter ,328,129 SF 25% Blue Diamond Business Center Warehouse/Distribution PC Southwest 430,000 SF 0% Escondido Airport Park Light Industrial PC Airport 30,897 SF 0% Lincoln Business Center Warehouse/Distribution PC North Las Vegas 337,000 SF 0% Marnell Airport Center MAC2 Warehouse/Distribution PC Airport 58,195 SF 0% Marnell Airport Center MAC3 Warehouse/Distribution PC Airport 74,882 SF 0% Northgate Distribution Center Warehouse/Distribution UC North Las Vegas 570,810 SF 100% Northgate Distribution Center Bldg 3 Warehouse/Distribution UC North Las Vegas 813,120 SF 100% Prologis I-15 Speedway Logistics Center Bldg 2 Warehouse/Distribution PC North Las Vegas 621,857 SF 3% Prologis Las Vegas Corporate Center Bldg 10 Warehouse/Distribution PC North Las Vegas 131,345 SF 0% Prologis Las Vegas Corporate Center Bldg 12 Warehouse/Distribution UC North Las Vegas 159,390 SF 0% Prologis Las Vegas Corporate Center Bldg 13 Warehouse/Distribution UC North Las Vegas 100,633 SF 0% 4th Quarter ,604,352 SF 0% Henderson Commerce Center II Bldg U Warehouse/Distribution PC Henderson 50,400 SF 0% Henderson Commerce Center II Bldg V Warehouse/Distribution PC Henderson 54,000 SF 0% Henderson Commerce Center II Bldg W Warehouse/Distribution PC Henderson 81,600 SF 0% Henderson Interchange Center Bldg 1 Warehouse/Distribution PC Henderson 130,990 SF 0% Henderson Interchange Center Bldg 2 Warehouse/Distribution PC Henderson 230,331 SF 0% Prologis Las Vegas Corporate Center Bldg 14 Warehouse/Distribution PC North Las Vegas 131,750 SF 0% Prologis Las Vegas Corporate Center Bldg 15 Warehouse/Distribution PC North Las Vegas 168,400 SF 0% Sunpoint Crossing Warehouse/Distribution PC North Las Vegas 760,481 SF 0% ,256,752 SF 16% 5785 N Hollywood Blvd Warehouse/Distribution PC North Las Vegas 36,000 SF BTS Clayton Park Incubator PC North Las Vegas 87,900 SF 0% Craig & Walnut SEC Warehouse/Distribution PC North Las Vegas 122,495 SF 0% Lamb Industrial Light Distribution PC North Las Vegas 121,890 SF 0% Northgate Distribution Center Bldg 9 Warehouse/Distribution PC North Las Vegas 690,096 SF 0% Prologis I-15 Speedway Logistics Center Bldg 3 Warehouse/Distribution PC North Las Vegas 560,380 SF 0% Prologis I-15 Speedway Logistics Center Bldg 4 Warehouse/Distribution PC North Las Vegas 367,060 SF 0% South15 Airport Center Bldg 1 Warehouse/Distribution PC Henderson 86,880 SF 0% South15 Airport Center Bldg 2 Warehouse/Distribution PC Henderson 73,840 SF 0% South15 Airport Center Bldg C Warehouse/Distribution PC Henderson 189,000 SF 0% South15 Airport Center Bldg D Warehouse/Distribution PC Henderson 91,000 SF 0% South15 Airport Center Bldg E Warehouse/Distribution PC Henderson 200,000 SF 0% South15 Airport Center Bldg F Warehouse/Distribution PC Henderson 100,800 SF 0% South Jones Industrial Park Light Industrial PC Southwest 29,411 SF 0% Switch SuperNAP Warehouse/Distribution PC Southwest 500,000 SF BTS 10 Las Vegas Research & Forecast Report Q Industrial Colliers International

11 an improvement over 2016, and vacancy is now a very low 4.6 percent. Unlike the warehouse/distribution market, the light distribution market has no product under construction, though 440,967 square feet is planned to begin construction in the next twelve months. The light industrial sector posted slightly weaker net absorption in the first quarter of 2017 compared to This is the third quarter of weakening demand for light industrial space, and this weakness could have something to do with a lack of new product. There is currently 54,000 square feet of light industrial product under construction in the market, and another 60,000 square feet planned. As that space is completed, we will see if light industrial is suffering for a lack of choices, or a true softening of demand. Light industrial vacancy stood at 5.0 percent in the first quarter. The incubator market was not doing well at the end of 2016, but saw improvement in the first quarter of Net absorption was 45,631 square feet, bringing vacancy down to 7.7 percent. Asking rates decreased for incubator space by $0.02 psf in the first quarter, as the market adjusted to softer demand. The flex market, on the other hand, which ended 2016 on a high note took a rest in the first quarter of 2017, with negative 20,976 square feet of net absorption and 9.9 percent vacancy. Flex was the only product type that saw asking rates increase in the first quarter, and given the softer demand this might have been a mistake. After 2015 s spike in demand for industrial space, Southern Nevada s developers put their toes in the water of speculative development in 2016 and found that the water felt just fine. In 2017, they have done a cannon ball and might find the water is a little colder than they thought. Demand remained steady, and even improved, in the first quarter of 2017, but did not keep up with development. It is unlikely that demand will keep up with supply throughout 2017, which is why we think vacancy rates will probably top 8.0 percent by the end of the year. That being said, new development of warehouse/distribution product was justified, though perhaps cramming two or three years of development into a single year was a bit hasty. We think demand will remain steady through 2017, and by 2018 vacancy rates will begin to decrease. Southern Nevada has been threatening a construction boom for a few years now, and in 2017 the boom has arrived. - John Stater, Research & GIS Manager Investment Sales YTD No. Sales Square Feet Sold 3,526,000 5,832,000 2,759,000 3,309, ,000 Sales Volume $189.1 MM $496.2 MM $248.8 MM $308.9 MM $64.1 MM Average Price/SF $53.65 $85.08 $90.20 $93.35 $90.34 Average Cap Rate 7.0% 7.3% 7.1% 7.2% 7.1% Average Sale Size (SF) 61,000 58,000 53,000 47,000 71,000 *Using the Consumer Price Index, All Urban Consumers, West Region, Class A Cities, = Las Vegas Research & Forecast Report Q Industrial Colliers International

12 NORTHWEST NORTH LAS VEGAS 15 Significant Industrial Sale Activity Northpoint Business Center 421,000 SF - $36,000,000 $86.00/SF December 2016 Warehouse/Distribution WEST CENTRAL EAST LAS VEGAS Harmon Warehouse Center 135,000 SF - $14,200,000 $105.00/SF January 2017 Light Distribution 95 Whitney Ranch Business Center 57,000 SF - $5,000,000 $88.00/SF December 2016 Incubator SOUTHWEST 215 AIRPORT HENDERSON Hughes Airport Center 34,000 SF - $4,700,000 $140.00/SF December 2016 Warehouse/Distribution 4120 Donovan Way 32,000 SF - $4,700,000 $149.00/SF January 2017 Light Industrial Lease Activity Property Name Lease Date Lease Term Size Effective Rate Type ProLogis Park Mar months 253,000 SF $0.48 NNN Warehouse/Distribution Nellis Industrial Center Jan months 20,000 SF $0.46 NNN Light Distribution Highland Industrial Center Mar months 16,000 SF $0.60 NNN Light Industrial Valley View Russell Commerce Jan months 3,000 SF $1.06 NNN Incubator Northpoint Business Center Jan months 2,500 SF $0.50 NNN Flex 12 Las Vegas Research & Forecast Report Q Industrial Colliers International

13 Market Comparisons - Las Vegas Industrial Market TYPE TOTAL INVENTORY SF DIRECT VACANT SF DIRECT VACANCY RATE SUBLEASE VACANCY SF TOTAL VACANT SF VACANCY RATE CURRENT QUARTER VACANCY RATE PRIOR QUARTER NET ABSORPTION CURRENT QTR SF NET ABSORPTION YTD SF COMPLETIONS CURRENT QTR SF COMPLETIONS YTD SF UNDER CONSTRUCTION SF PLANNED CONSTRUCTION SF WEIGHTED AVG ASKING RENTAL RATE AIRPORT SUBMARKET WH 5,859, , % - 339, % 5.9% 5,249 5, $0.73 LD 3,235, , % 4, , % 6.2% 4,118 4, ,077 $0.74 LI 2,972, , % - 129, % 4.9% 16,334 16, ,000 30,897 $0.92 INC 1,500, , % - 171, % 12.4% 13,003 13, $1.18 FLX 1,509, , % 11, , % 12.8% 15,243 15, $0.90 Total 15,076, , % 16, , % 7.1% 53,947 53, , ,974 $0.87 EAST LAS VEGAS SUBMARKET WH 1,115, % % 2.3% 25,183 25, $0.45 LD 532,163 63, % - 63, % 14.3% 12,144 12, $0.36 LI 1,798,513 90, % - 90, % 4.8% (3,108) (3,108) $0.74 INC 281,755 26, % - 26, % 9.6% $0.61 FLX 233,692 7, % - 7, % 3.0% (300) (300) $0.60 Total 3,961, , % - 188, % 5.6% 34,218 34, $0.59 HENDERSON SUBMARKET WH 7,858, , % - 849, % 9.4% 527, , , ,300-1,102,841 $0.51 LD 1,648,306 60, % - 60, % 6.7% 38,077 38, ,000 $0.57 LI 3,684, , % - 142, % 3.9% (7,767) (7,767) $0.74 INC 496,625 13, % - 13, % 4.6% 8,894 8, $0.53 FLX 1,380,046 72, % 12,739 84, % 5.9% (3,341) (3,341) $0.95 Total 15,068,347 1,139, % 12,739 1,151, % 7.2% 563, , , ,300-1,288,841 $0.57 NORTH LAS VEGAS SUBMARKET WH 24,558,697 1,757, % 33,307 1,790, % 2.9% 231, ,374 1,331,602 1,331,602 3,040,998 4,117,890 $0.43 LD 5,047, , % 0 261, % 6.6% 71,839 71, ,890 $0.53 LI 9,079, , % 0 490, % 5.0% -45,588 (45,588) $0.54 INC 724,573 91, % 0 91, % 15.5% 20,958 20, ,900 $0.60 FLX 796, , % 0 113, % 11.8% -19,876 (19,876) $0.88 Total 40,206,343 2,715, % 33,307 2,748, % 4.3% 258, ,707 1,331,602 1,331,602 3,040,998 4,327,680 $0.48 NORTHWEST SUBMARKET WH 224, % % 0.0% $- LD 50,000 11, % - 11, % 0.0% (11,097) (11,097) $0.85 LI 341,430 17, % - 17, % 5.2% $0.64 INC 99,427 22, % - 22, % 17.2% (5,731) (5,731) $0.74 FLX 740,230 68, % - 68, % 10.7% (2,666) (2,666) $0.87 Total 1,455, , % - 119, % 7.8% (19,494) (19,494) $0.81 SOUTHWEST SUBMARKET WH 15,012, , % 14, , % 4.3% 73,136 73, , , , ,000 $0.63 LD 7,342, , % 173, , % 6.2% 63,834 63, $0.77 LI 10,509, , % 5, , % 5.1% 42,353 42, ,411 $0.75 INC 2,353, , % 3, , % 6.0% (10,005) (10,005) $0.70 FLX 1,685, , % - 182, % 10.7% (987) (987) $0.88 Total 36,903,469 1,812, % 197,743 2,009, % 5.3% 168, , , , , ,411 $0.71 WEST CENTRAL SUBMARKET WH 2,253,774 17, % - 17, % 0.8% $0.33 LD 999,141 86, % - 86, % 8.8% $0.53 LI 7,792, , % 6, , % 6.3% 38,100 38, $0.75 INC 2,511, , % - 140, % 6.3% 18,213 18, $0.75 FLX 161,527 20, % - 20, % 7.0% (9,049) (9,049) $0.67 Total 13,718, , % 6, , % 5.6% 47,881 47, $0.71 MARKET TOTAL WH 56,883,180 3,729, % 48,167 3,777, % 4.4% 862, ,365 2,265,340 2,265,340 3,415,998 6,150,731 $0.52 LD 18,854, , % 178,196 1,051, % 6.7% 179, , ,967 $0.63 LI 36,179,046 1,804, % 12,240 1,816, % 5.2% 40,324 40, ,000 60,308 $0.70 INC 7,967, , % 3, , % 8.3% 45,631 45, ,900 $0.82 FLX 6,506, , % 24, , % 9.9% (20,976) (20,976) $0.88 Total 126,391,153 7,662, % 266,170 7,929, % 5.5% 1,106,876 1,106,876 2,265,340 2,265,340 3,469,998 6,739,906 $0.63 QUARTERLY COMPARISON AND TOTALS Q ,391,153 7,662, % 266,170 7,929, % 5.5% 1,106,876 1,106,876 2,265,340 2,265,340 3,469,998 6,739,906 $0.63 Q ,125,813 6,504, % 335,896 6,840, % 5.6% 922,541 3,534, ,320 3,332,657 4,472,122 5,980,699 $0.67 Q ,199,493 6,500, % 372,085 6,872, % 6.0% 955,325 2,612, ,336 2,406,337 3,868,338 5,799,971 $0.65 Q ,559,157 6,815, % 514,396 7,330, % 6.0% 778,135 1,657, ,726 1,766,001 1,940,708 5,764,758 $0.62 Q ,897,431 6,932, % 380,928 7,312, % 5.6% 878, ,886 1,104,275 1,104,275 1,446,539 5,155,620 $0.65 Q ,793,156 6,706, % 110,304 6,816, % 6.2% 515,907 4,949, ,608 1,900,601 2,224,326 4,361,662 $0.63 Q ,619,548 7,048, % 467,329 7,516, % 6.8% 1,681,842 4,433, ,290 1,726,993 1,689,817 6,390,005 $0.60 WH = Warehouse LD = Light Distribution LI = Light Industrial INC = Incubator FLX = Flex 13 Las Vegas Research & Forecast Report Q Industrial Colliers International

14 Research & Forecast Report LAS VEGAS OFFICE Q Office Shines On > > Southern Nevada s office market continued its slow and steady improvement into 2017 > > Net absorption improved in the first quarter, taking vacancy down to 17.0 percent > > Development of new office space remains very restrained Southern Nevada s office market just keeps on keeping on. Not as dramatic as the industrial market, the office market managed to record yet another quarter of recovery in the first quarter of Net absorption was 127,479 square feet in the first quarter, an improvement from last quarter. This took vacancy down to 17.0 percent, an improvement from the peak of 22.5 percent five years ago. Vacancy rates in more desirable product are lower than 17.0 percent. Asking rates took a break from their steady upward climb and dropped to $2.02 per square foot (psf) on a Full Service Gross (FSG) in the first quarter. Southern Nevada s office job market rebounded in January 2017 (the latest month of data available) compared with January After poor numbers in the fourth quarter of 2016, the market apparently made a miraculous recovery, adding approximately 19,100 jobs in the past twelve months, with the largest gain coming from the professional and business services sector (+10,900 jobs), the very sector that collapsed a quarter ago. Employment numbers have tended to be spastic since the BLS took over Southern Nevada s estimates from NDETR, so take these new Historical Vacancy Rates and Asking Lease Rates Economic Indicators Office Employment +6.7% Market Indicators Office SF/Job +1.9% Q Sublease Vacancy Relative to prior period Q Q2 2017* VACANCY NET ABSORPTION COMPLETIONS RENTAL RATE *Projected Summary Statistics Las Vegas Market Q1-16 Q4-16 Q1-17 Vacancy Rate 17.5% 17.2% 17.0% 19.0% $2.05 Asking Rent (PSF, NNN) $2.00 $2.03 $ % $2.00 Net Absorption (SF) 278,828 40, , % $1.95 New Completions (SF) 10, ,103 0 $ % $1.85 Overall Asking Rents Per Square Foot 15.0% 1 Q Q Q Q Q Q Q Q Q 2017 $1.80 Class A $2.66 $2.70 $2.68 Vacancy Asking Rental Rate As vacancy rates reach that new normal, expect to see more speculative office projects become viable. Class B $2.04 $2.03 $2.03 Class C $1.64 $1.68 $1.70

15 estimates with a grain of salt. Unemployment in the Las Vegas-Paradise MSA stood at 5.1 percent as of January 2017, down from 6.5 percent in January From January 2016 to January 2017, total employment in Southern Nevada has increased by 37,500 jobs. No new office space was completed in the first quarter of 2017, after the market added almost 300,000 square feet to inventory in 2016, one-third of it for government tenants. The office pipeline remained light at the beginning of 2017, with only 72,000 square feet of office space under construction. An additional 739,000 square feet of office space was planned to begin construction within the next twelve months. Historical Net Absorption vs. Completions 700, , , , , , ,000 Southern Nevada s office market had 127,479 square feet of net absorption in the first quarter of 2017, up from the 40,170 square feet of net absorption in the fourth quarter of Net absorption averaged 163,000 square feet per quarter in 2016, with demand dipping at the end of the year, and now hopefully showing a comeback. Major tenants vacating space this quarter include the GLVAR, Cirque du Soleil, Jacobs Engineering Group, ADT Security, McBride & Milner and Black & Veatch. Most of these tenants made lateral movements in the market. This quarter, net absorption was highest in the Northwest submarket (94,014 square feet), followed by West Central (74,217 square feet) and Southwest (46,995 square feet), showing the same west side bias as was seen in Negative net absorption was experienced this year in Downtown (negative 71,056 square feet), Henderson (negative 32,684 square feet) and North Las Vegas (negative 18,956 square feet) ,000 1 Q Q Q 2015 Occupancy vs. Office Employment 140, , , , , , ,000 Net Absorption 4 Q Q Q Q 2016 Completions 4 Q Q % 83.0% 82.0% 81.0% 80.0% 79.0% 78.0% Demand for office space over the past twelve months came primarily from professional and business services, financial activities and engineering and management. In the lease comps to which we had access, local tenants took 36 percent of the leased space, tenants from the Southwest U.S. 39 percent and from the Northeastern states 12 percent. 105,000 1 Q Q Q 2015 Office Jobs 4 Q Q Q Q Q 2016 Occupancy Rate 1 Q % Southern Nevada currently averages 272 square feet of occupied office space per office job. This number peaked in 2010 at approximately 347 square feet per job, and has been sliding ever since. The last time this statistic was this low was in 2006, and it is worth noting that it has been lower and therefore could continue to fall. The trend behind this number s movement is one JAN 2016 JAN 2017 CHANGE Information 11,000 10, Financial Activities 49,100 43, ,500 Professional & Business Services 136, , ,900 Health Care 62,700 60, ,800 Source: Nevada Department of Employment, Training and Rehabilitation Vacancy by Size Range Difference Size Range Units Total SF Units Total SF Units Total SF 0 to 2,500 sf 989 1,425,953 1,040 2,043, ,143 2,501 to 5,000 sf 478 1,697, ,966, ,997 5,001 to 10,000 sf 226 1,509, ,315, ,632 10,001 to 20,000 sf 102 1,463, ,291, ,063 20,000 sf ,721, ,073, , Las Vegas Research & Forecast Report Q Office Colliers International

16 Investment Sales Activity YTD No. Sales Square Footage 3,666,000 2,836,000 1,879,000 1,690, ,000 Sales Volume $559.4 MM $367.2 MM $323.6 MM $225.8 MM $138.7 MM Average Price/SF $ $ $ $ $ Average Cap Rate 7.6% 7.7% 7.5% 7.7% 7.3% Average Sale Size (SF) 39,000 35,000 28,000 31,000 33,000 of smarter use of office space by office users, who are utilizing concepts like shared space or hoteling to maximize their efficiency. The office vacancy rate in Southern Nevada in the first quarter of 2017 was 17.0 percent, a decrease from last quarter s rate of 17.3 percent. Office vacancy peaked at 22.5 percent in 2011 and 2012; however it decreased in five of the Valley s eight submarkets this quarter, with the venerable West Central submarket again experiencing the largest decrease (1.5 percentage points), followed by Northwest (1.1 points), Southwest (0.7 points), Airport (0.3 points) and East Las Vegas (0.2 points). Vacancy increased in North Las Vegas (2.4 points), Downtown (1.4 points) and Henderson (0.6 points). When examined by the size range of vacant units (including vacant sub-lease spaces), large units were the big winners in the first quarter of Units larger than 5,000 square feet saw absorption of just over 1.0 million square feet, with 75 of those units being occupied. Units of 5,000 square feet or smaller, on the other hand, were vacated to the tune of 886,000 square feet. In the smallest range of units, an additional 51 units were added to the market, while the next larger range actually saw the number of units on the market decrease, while the total space increased. At the end of 2016, vacant units in this range averaged 3,550 square feet, while in this quarter they averaged 4,220 square feet. This could actually represent tenant expansion, with tenants in the smallest two size ranges leaving smaller units for larger. The weighted average asking rental rate for office space in Southern Nevada decreased to $2.02 per square foot (psf) on a full service gross (FSG) basis in the first quarter of 2017, a $0.01 psf increase from last quarter. The Southwest remained the most expensive submarket this quarter, with an asking rental rate of $2.28 psf FSG, ahead of Downtown s $2.23 psf FSG. The Valley s lowest average asking rate is in the North Las Vegas submarket, at $1.58 psf FSG. Office space available for sublease decreased in the first quarter of 2017 to 376,116 square feet from last quarter s total of 383,923 square feet. the office market managed to record yet another quarter of recovery in the first quarter of John Stater, Research & GIS Manager Office investment sales improved in the first quarter of 2017 with sales volume of $138.7 million in 24 sales totaling 797,000 square feet with an average price per square foot of $ and an average cap rate of 7.3 percent. The average investment sales price in 2016 was just $ due to the sale of a large building in the Downtown submarket saw an average price per square foot more in line with At the beginning of 2017 there was almost 2.1 million square feet of office space available for sale as an investment, with an average asking price of $ psf and an average cap rate of 7.0 percent. With five years of solid performance behind it, Southern Nevada is now extending its recovery into a sixth year. Recovery might be the wrong word, though, as it is likely the office market is entering what might be considered a new normal. We think office vacancy rates will continue to fall, probably stabilizing in the 15 percent range within the next two years. As vacancy rates reach that new normal, expect to see more speculative office projects become viable. 16 Las Vegas Research & Forecast Report Q Office Colliers International

17 Office Development Schedule Project Class Submarket Size Pre-Leasing Q ,364 SF 17% St Rose Coronado Center Bldg 1 B Henderson 62,364 SF 4% Sunset Hills Plaza C Southwest 10,000 SF 100% Q ,000 SF 24% Magnum Towers B Southwest 100,000 SF 24% ,046 SF Symphony Park A Downtown 200,000 SF 0% 6400 S Rainbow Blvd B Southwest 46,646 SF 84% Cadence Bldg 2 C Henderson 15,000 SF 0% Cadence Bldg 3 C Henderson 15,000 SF 0% Centennial Hills Center B Northwest 87,000 SF 0% Centennial Hills Center C Northwest 37,100 SF 0% Pace Plaza B Southwest 42,000 SF 0% Pavilion Griffith Park A Northwest 152,300 SF 0% Seven Hills Plaza Bldg D B Henderson 50,000 SF 0% 17 Las Vegas Research & Forecast Report Q Office Colliers International

18 215 NORTH LAS VEGAS Significant Office Sale Activity 550 South Main 95 63,000 SF - $12,200,000 $195.00/SF February 2017 NORTHWEST 15 Class B First American Title Plaza SUMMERLIN WEST CENTRAL DOWN TOWN 95 EAST LAS VEGAS 30,000 SF - $5,250,000 $177.00/SF February 2017 Class C JBA Office Plaza 28,000 SF - $7,000,000 $254.00/SF February 2017 Class C 215 AIRPORT Town Square 288,000 SF - $54,006,000 $188.00/SF SOUTHWEST HENDERSON January 2017 Class A CSA Service Center 80,000 SF - $7,300,000 $91.00/SF March 2017 Class B Lease Activity Property Name Lease Date Lease Term Size Lease Rate Type Eastern Canyon Plaza Jan months 17,000 SF $1.11 NNN Class C Pageantry West Office Park Jan months 9,000 SF $1.37 MG Class B Desert Canyon Business Park Feb months 7,000 SF $2.25 MG Class B Hughes Airport Center Jan months 5,000 SF $2.03 FSG Class B Stephanie Beltway Center Jan months 5,000 SF $1.79 MG Class B 18 Las Vegas Research & Forecast Report Q Office Colliers International

19 Market Comparisons - Las Vegas Office Market CLASS TOTAL INVENTORY SF DIRECT VACANT SF DIRECT VACANCY RATE SUBLEASE VACANT SF VACANCY RATE TOTAL VACANT CURRENT SF QUARTER VACANCY RATE PRIOR QUARTER NET ABSORPTION CURRENT QTR SF NET ABSORPTION YTD SF COMPLETIONS CURRENT QTR SF COMPLETIONS YTD SF UNDER CONSTRUCTION SF PLANNED CONSTRUCTION SF WEIGHTED AVG ASKING RENTAL RATE AIRPORT SUBMARKET A 729, , % - 219, % 34.0% 25,766 25, $2.82 B 2,406, , % 15, , % 14.6% 3,230 3, $2.00 C 3,211, , % 25, , % 17.4% (7,506) (7,506) $1.76 Total 6,346,609 1,106, % 41,027 1,147, % 18.3% 21,490 21, $2.04 DOWNTOWN SUBMARKET A 1,232, , % 2, , % 18.7% (2,433) (2,433) ,000 $2.71 B 2,355, , % - 276, % 10.3% (34,733) (34,733) $2.14 C 1,432, , % - 205, % 12.0% (33,890) (33,890) $1.80 Total 5,019, , % 2, , % 12.8% (71,056) (71,056) ,000 $2.23 EAST LAS VEGAS SUBMARKET A 1,353, , % 37, , % 24.5% 25,999 25, $2.92 B 1,542, , % 1, , % 29.2% (2,721) (2,721) $1.37 C 2,591, , % 3, , % 20.3% (9,819) (9,819) $1.37 Total 5,487,173 1,251, % 42,371 1,293, % 23.8% 13,459 13, $1.70 HENDERSON SUBMARKET A 583, , % 5, , % 37.3% $2.71 B 2,566, , % 14, , % 16.4% -11,337 (11,337) ,364 50,000 $2.15 C 2,158, , % 8, , % 17.1% -21,347 (21,347) ,000 $1.71 Total 5,308,564 1,022, % 27,926 1,050, % 19.0% (32,684) (32,684) ,364 80,000 $2.10 NORTH LAS VEGAS SUBMARKET A - - n/a - - n/a n/a $- B 245,696 53, % - 53, % 13.5% (19,982) (19,982) $1.81 C 543, , % - 105, % 19.6% 1,026 1, $1.47 Total 789, , % - 158, % 17.7% (18,956) (18,956) $1.58 NORTHWEST SUBMARKET A 1,959, , % 43, , % 27.3% 80,937 80, ,300 $2.45 B 3,540, , % - 544, % 16.7% 45,694 45, ,000 $2.15 C 3,367, , % 6, , % 11.1% (32,617) (32,617) ,100 $1.82 Total 8,867,220 1,355, % 50,023 1,405, % 16.9% 94,014 94, ,400 $2.14 SOUTHWEST SUBMARKET A 597,112 26, % 10,098 36, % 6.9% 4,445 4, $2.53 B 2,966, , % 22, , % 19.7% 28,506 28, ,646 $2.47 C 3,518, , % - 439, % 13.0% 14,044 14, ,000 - $2.04 Total 7,082, , % 32,374 1,023, % 15.3% 46,995 46, , ,646 $2.28 WEST CENTRAL SUBMARKET A 157,624 18, % - 18, % 11.9% $2.46 B 1,922, , % - 421, % 23.6% 32,844 32, $1.91 C 3,012, , % 3, , % 16.0% 41,373 41, $1.59 Total 5,093, , % 3, , % 18.7% 74,217 74, $1.76 MARKET TOTAL A 6,612,657 1,392, % 98,655 1,490, % 24.5% 134, , ,300 $2.68 B 17,545,830 3,035, % 54,074 3,090, % 17.8% 41,501 41, , ,646 $2.03 C 19,835,872 3,049, % 46,437 3,096, % 15.4% (48,736) (48,736) ,000 67,100 $1.70 Total 43,994,359 7,478, % 199,166 7,677, % 17.7% 127, , , ,046 $2.02 QUARTERLY COMPARISON AND TOTALS Q ,994,359 7,478, % 199,166 7,677, % 17.7% 127, , , ,046 $2.02 Q ,994,359 7,605, % 192,057 7,797, % 17.5% 40, , , ,208 10, ,400 $2.02 Q ,834,256 7,485, % 204,870 7,690, % 17.9% 216, , , , ,302 $2.01 Q ,834,256 7,702, % 157,956 7,860, % 18.1% 119, , , , , ,140 $1.99 Q ,712,851 7,699, % 192,126 7,892, % 18.7% 278, ,828 10,700 10, , ,140 $1.99 Q ,702,151 7,968, % 197,676 8,165, % 18.6% 113, , , , , ,140 $1.96 Q ,578,534 7,957, % 150,546 8,108, % 19.0% 192, ,477 46, , , ,140 $ Las Vegas Research & Forecast Report Q Office Colliers International

20 Research & Forecast Report LAS VEGAS RETAIL Q Retail Slows but Does Not Stop > > Strong net absorption in the second half of 2016 did not extend into 2017 > > Vacancy remained under 9.0 percent, but increased in the first quarter > > Asking rental rates remained at $1.36 per square foot on a triplenet basis The retail market hit another bump in the road in the first quarter, with negative net absorption brought about by the closure of some large anchor locations. Net absorption in the first quarter totaled negative 17,825 square feet, bringing the vacancy rate up slightly to 8.4 percent. Vacancy was still down on a year-over-year basis. The asking rental rate for retail space in the first quarter of 2017 was $1.36 per square foot (psf) on a triple-net (NNN) basis, $0.06 higher than one year ago. According to the Nevada Department of Employment, Training and Rehabilitation, Southern Nevada s retail job market suffered in January 2017 (the latest month of data available) compared with January 2016, losing approximately 2,100 jobs in the past twelve months. Historical Vacancy Rates and Asking Lease Rates 7.0% 6.0% $0.68 $0.66 Economic Indicators RETAIL Employment Market Indicators Relative to prior period Q Q2 2017* VACANCY NET ABSORPTION CONSTRUCTION RENTAL RATE *Projected +3.2% Summary Statistics RETAIL Taxable Sales +2.6 RETAIL SF/Job +1.6% Q Las Vegas Market Q1-16 Q4-16 Q1-17 Vacancy Rate 9.1% 8.3% 8.4% 5.0% $0.64 Asking Rent (PSF, NNN) $1.30 $1.35 $ % 3.0% $0.62 $0.60 Net Absorption (SF) 283, ,591-17, % $0.58 New Completions (SF) 80,000 65,851 53, % $ % 2 Q Q Q Q Q Q Q Q 2017 $0.54 Overall Asking Rents Per Square Foot Vacancy Asking Rental Rate Power Center $1.55 $1.58 $1.54 Community Center $1.21 $1.26 $1.29 As new centers are completed over the next two quarters, we think net absorption will rebound, and that 2017 will prove to be a productive year for Southern Nevada s retail market. Neighborhood Center $1.46 $1.50 $1.49 Strip Retail $1.16 $1.22 $1.24

21 Unemployment in the Las Vegas-Paradise MSA stood at 5.1 percent as of January 2017, down from 6.5 percent in January From January 2016 to January 2017, total employment in Southern Nevada has increased by 37,500 jobs. The Nevada Department of Taxation reports that Clark County s taxable retail sales for the past twelve months (December 2015 to November 2016, the most recent month of data available) totaled $28.8 billion, up from $27.9 billion in the previous twelve months. In the past twelve months taxable sales were $4.6 billion in the automotive sector, $10.3 billion in food service and $13.6 billion in other retail (excluding gas stations). The highest year-over-year growth in taxable retail sales in November 2016 were in health and personal care stores (11.9 percent growth), home and garden stores (11.3 percent growth) and furniture stores (11.2 percent growth). Year-over-year taxable sales decreased in electronics and appliance stores (negative 6.1 percent growth), clothing stores (negative 5.4 percent) and hobby stores (negative 0.9 percent). Nonstore retailers, by comparison, posted 25.5 percent year-over-year growth. The only retail completions in the first quarter of 2017 were 1st & Main, a 19,800 square foot strip center in the Downtown submarket, and the fourth phase of Green Valley Crossing in Henderson. The market currently has 446,550 square feet of retail product under construction, and another 1.18 million square feet planned to begin construction within the next twelve months. While vacancy took a wrong turn in the first quarter, there is still a strong possibility of increased development through 2017 and 2018, especially as multifamily and single-family residential construction continues and the population continues to grow. Net absorption totaled negative 17,825 square feet in the first quarter of 2017, a significant step down from the fourth quarter of 2016 when net absorption totaled 234,591. Among product types, neighborhood centers suffered the worst, posting negative 61,327 square feet of net absorption. Vacated anchor and junior anchor spaces were the primarily culprits, with businesses including Sav-a-Lot grocery, the V.A., Sports Chalet and Toys R Us all leaving space this quarter. These anchors represented an addition of 145,066 vacant square feet to the market. Competition from internet retailers may be playing a part in these closures, as 53 anchor locations have been vacated since the current recovery started in Seventeen of these spaces have been filled, many of them by non-traditional retailers in that time. Although not tracked in this reports numbers, the JC Penneys at the Boulevard Mall is among the 130 stores that will be closing in 2017, joining the Macy s which shuttered there in Historical Net Absorption vs. Completions 450, , , , , , , ,000 50, , ,000 2 Q Q Q Q Q Q Q Q 2017 Net Absorption Occupancy vs. Retail Employment 84,000 83,000 82,000 81,000 80,000 79,000 78,000 Completions 2 Q Q Q Q Q Q Q Q 2017 Retail Jobs Occupancy Rate 93.0% 92.0% 91.0% 90.0% 89.0% 88.0% 87.0% Net absorption was positive in five of the Valley s eight submarkets, with the Downtown, Henderson and University East submarkets posting negative net absorption in the first quarter. Net absorption was highest this quarter in the West Central submarket (61,613 square feet), followed by the Northwest and North Las Vegas submarkets, which absorbed 20,775 square feet and 20,324 square feet respectively. Net absorption was lowest in Downtown (negative 57,474 square feet) and University East (negative 47,965 square feet). 21 Las Vegas Research & Forecast Report Q Retail Colliers International

22 Strong multifamily development along the I-215 Beltway, stretching from Henderson to the Northwest, should stimulate demand for retail space over the next months in the Henderson, Southwest and Northwest submarkets. Gross absorption of retail product totaled 467,471 square feet in the first quarter of 2017, lower than one quarter ago, but a great improvement over the first quarter of Retail vacancy in Southern Nevada was 8.4 percent in the first quarter of 2017, an increase of 0.1 points from last quarter, and and 0.7 points lower than one year ago. Southern Nevada s retail market has been expanding since 2012, though growth was slower in 2014 and dipped for one quarter in 2016 into negative territory. This gives us two periods of strong growth, from , and Negative net absorption this quarter does not mean that the growth period is necessarily over, but it does suggest that it may be ending this year unless we see a rebound by mid-year. Among submarkets, the Valley s highest vacancy this quarter was 12.4 percent in Downtown and University East, while the lowest vacancy rate, 6.3 percent, was in the burgeoning Southwest submarket. All submarkets but Downtown, Henderson and University East saw vacancy decrease in the first quarter of The average asking rental rate for retail space in Southern Nevada was $1.36 psf NNN in the first quarter of This was the same asking rate as in the fourth quarter of 2016, and it represents a $0.06 psf increase from one year ago. In the first quarter of 2017, five submarkets saw asking rates increase on a quarter-over-quarter basis University East ($0.04 psf), Henderson ($0.02 psf), West Central ($0.02 psf), North Las Vegas ($0.01 psf), and Southwest ($0.01 psf). Asking rates decreased in Downtown ($0.07 psf), Northwest ($0.02 psf) and Northeast ($0.01 psf). Since the fourth quarter of 2016, asking rents decreased in power centers ($0.04 psf) and neighborhood centers ($0.01 psf), and increased by $0.02 psf in community centers and strip centers. Single-Tenant Retail YTD 2017 No. Sales Square Footage Sold 719, , , ,000 64,000 Sales Volume $139.8 MM $187.5 MM $306.2 MM $174.4 MM $23.7 MM Average Price/SF $ $ $ $ $ Average Sale Size (SF) 15,300 10,500 14,900 8,500 5,300 Cap Rate N/A 7.2% 7.2% 7.0% 6.0% Shopping Center Retail YTD 2017 No. Sales Square Footage Sold 3,192,000 4,025,000 3,195,000 2,528,000 1,628,000 Sales Volume $359.2 MM $504.5 MM $588.1 MM $419.7 MM $346.1 MM Average Price/SF $ $ $ $ $ Average Sale Size (SF) 66,000 67,000 55,000 62, ,000 Cap Rate N/A 8.9% 7.7% 6.7% 6.6% Retail Development Schedule Project Type Submarket Size (SF) Pre-Leasing Q ,000 SF 67% Spencer Crossing Strip Retail Henderson 21,000 SF 67% Q ,000 SF 99% 7560 Oso Blanca Rd Strip Retail Northwest 26,000 SF 47% St Rose Coronado Center Strip Retail Henderson 18,000 SF 8% Walgreens (Blue Diamond) Neighborhood Center Southwest 169,000 SF BTS Q ,000 SF 42% Mountains Edge Marketplace Community Center Southwest 205,000 SF 42% Q ,000 SF 66% DCs Plaza Neighborhood Center Northwest 73,000 SF 66% 22 Las Vegas Research & Forecast Report Q Retail Colliers International

23 Single-tenant retail investment sales volume in the first quarter of 2017 was $23.7 million in twelve sales totaling 64,000 square feet. This rendered an average price per square foot of $369.80, an improvement over The average cap rate was 6.0 percent, a reduction from 2016 s 7.0 percent cap rate. Shopping center investment sales volume in the first quarter was $346.1 million in thirteen sales totaling 1.6 million square feet. This rendered an average price per square foot of $212.63, higher than in Shopping center sales were hot in the first quarter, and put 2017 on pace to beat 2014 s 4.0 million square feet of shopping center sales. Investment sales had been heading down since 2014, and perhaps are turning around in The average cap rate was 6.6 percent, a slight compression from last year. Chick-Fil-A has finally entered the Southern Nevada market, and plans more stores in the future. Other retailers entering or expanding in Southern Nevada include Paul Mitchell, Discount Tire, Lolo s Chicken & Waffles, Chicken Shack, Café Rio, Five Guys Burger & Fries, Black Bear Diner, Wingnutz, Pei Wei, and Cheeseburger Cheeseburger. Target is introducing a new Target Express concept to compete with Dollar General or Walgreens, though no locations have yet been announced in Southern Nevada. Walmart is planning locations at Rainbow & Blue Diamond and Boulder & Russell, and Smith s Marketplace, a 125,000 square foot concept, looking into putting stores in the Cadence MPC and Skye Canyon. Southern Nevada s retail market has been expanding (mostly) steadily since the first quarter of 2015, putting us two years into the current expansion. At this point, is is difficult to say whether a negative first quarter will set the tone for the entire year. Retail employment figures from the BLS are not great, but those figures miss growth in new business and are often heavily revised. Taxable sales are only available up to last November, which means we do not yet know if consumer spending in Southern Nevada has reversed course. Given that much of the negative net absorption can be attributed to a few large anchor locations going vacant, it would be foolish to assume that this is the beginning of a trend. As new centers are completed over the next two quarters, we think net absorption will rebound, and that 2017 will prove to be a productive year for Southern Nevada s retail market. The retail market hit another bump in the road in the first quarter, with negative net absorption brought about by the closure of some large anchor locations. - John Stater, Research & GIS Manager Las Vegas Households (2017) Ave. HH Income (2017) Occupied Retail Space (2017 Avg.) Occupied Retail Space (2017 Avg.) Downtown 38,000 $41,000 2,010,000 1,958,000 Henderson 112,800 $86,000 9,537,000 9,526,000 North Las Vegas 75,200 $67,000 5,625,000 5,687,000 Northeast 82,300 $55,000 3,122,000 3,119,000 Northwest 181,600 $85,000 12,741,000 12,840,000 Southwest 99,000 $81,000 7,587,000 7,683,000 University East 108,100 $61,000 7,889,000 7,948,000 West Central 56,300 $53,000 6,303,000 6,406,000 Source of Demographic Data: Claritas 23 Las Vegas Research & Forecast Report Q Retail Colliers International

24 Significant Retail Sale Activity 215 NORTH LAS VEGAS Craig Marketplace 119,000 SF - $33,000,000 $277.00/SF NORTHWEST 95 December 2016 Multi-Tenant 15 Sunrise Marketplace 191,000 SF - $29,300,000 WEST CENTRAL DOWN TOWN NORTHEAST LAS VEGAS $153.00/SF December 2016 Multi-Tenant Rainbow Plaza North 105,000 SF - $23,100, $219.00/SF January 2017 UNIVERSITY AIRPORT Multi-Tenant Town Square ,000 SF - $161,600,000 $188.00/SF SOUTHWEST HENDERSON January 2017 Multi-Tenant RESORT CORRIDOR Anthem Highlands 119,000 SF - $29,500,000 $248.00/SF December 2016 Multi-Tenant Lease Activity Property Name Tenant Lease Date Lease Term Size Lease Rate Type Sahara Pavilion South InStyle Furniture Inc Mar months 11,600 SF $0.94 NNN Community Shadow Mountain Marketplace Big Drive Fitness Dec months 2,800 SF $2.20 NNN Community Scottsdale Plaza Tables Board Game Spot Feb months 2,400 SF $1.21 NNN Strip Retail Decatur Meadows El Varaderito Feb months 1,500 SF $1.58 NNN Community Aliante MarketPlace Skye Communication Dec months 1,500 SF $2.25 NNN Neighborhood 24 Las Vegas Research & Forecast Report Q Retail Colliers International

25 Market Comparisons - Las Vegas Retail Market TYPE TOTAL INVENTORY SF DIRECT VACANT SF DIRECT VACANCY RATE SUBLEASE VACANT SF TOTAL VACANT SF VACANCY RATE CURRENT QUARTER VACANCY RATE PRIOR QUARTER NET ABSORPTION CURRENT QTR SF NET ABSORPTION YTD SF COMPLETIONS CURRENT QTR SF COMPLETIONS YTD SF UNDER CONSTRUCTION SF PLANNED CONSTRUCTION SF WEIGHTED AVG ASKING RENTAL RATE DOWNTOWN PC - - n/a - - n/a n/a $- CC 607,055 84, % - 84, % 12.9% (6,135) (6,135) $1.28 NC 588, , % - 100, % 11.2% (35,161) (35,161) $0.91 SC 1,040,640 92, % - 92, % 5.5% (16,178) (16,178) 19,800 19,800-40,500 $1.41 Total 2,235, , % - 277, % 9.0% (57,474) (57,474) 19,800 19,800-40,500 $1.12 HENDERSON PC 2,896, , % - 105, % 3.4% (5,950) (5,950) $1.94 CC 2,714, , % - 169, % 5.7% 18,267 18,267 33,789 33, $1.52 NC 2,930, , % 116, , % 15.9% (10,179) (10,179) ,422 $1.44 SC 1,908, , % 3, , % 14.2% (25,726) (25,726) ,860 $1.12 Total 10,449, , % 116,457 1,039, % 9.5% (23,588) (23,588) 33,789 33, ,282 $1.41 NORTH LAS VEGAS PC 774,065 31, % - 31, % 4.1% $2.25 CC 2,311, , % 1, , % 6.9% 19,851 19, $1.56 NC 1,806, , % 2, , % 8.5% (28,983) (28,983) $1.37 SC 1,290, , % - 144, % 13.6% 29,456 29, $1.26 Total 6,182, , % 4, , % 8.4% 20,324 20, $1.45 NORTHEAST PC - - n/a - - n/a n/a $- CC 1,295,615 57, % 18,614 75, % 6.7% 10,671 10, $1.57 NC 1,307,891 90, % 62, , % 11.1% (8,205) (8,205) $1.47 SC 771, , % - 108, % 14.0% (496) (496) $0.88 Total 3,375, , % 80, , % 10.1% 1,970 1, $1.24 NORTHWEST PC 3,171, ,448 n/a 1, , % 7.5% (11,420) (11,420) $1.55 CC 4,716, , % 73, , % 4.3% 8,151 8, $1.04 NC 3,419, , % 36, , % 9.5% 12,802 12, ,550 - $1.67 SC 2,414, , % - 235, % 10.2% 11,242 11, ,000 $1.34 Total 13,721, , % 111, , % 7.4% 20,775 20, ,550 31,000 $1.46 SOUTHWEST PC 944,314 49, % - 49, % 4.9% (3,700) (3,700) $1.46 CC 2,616, , % - 107, % 4.1% (1,510) (1,510) ,000 - $1.75 NC 2,303, , % 3, , % 6.6% 1,115 1, ,000 65,000 $2.02 SC 2,332, , % - 204, % 9.2% 10,615 10, ,800 $1.55 Total 8,196, , % 3, , % 6.4% 6,520 6, , ,800 $1.72 UNIVERSITY EAST PC 1,210, , % - 123, % 10.1% (1,348) (1,348) $1.19 CC 2,946, , % 28, , % 11.0% (45,802) (45,802) $1.02 NC 1,953, , % 182, , % 7.6% (4,265) (4,265) ,588 $1.40 SC 2,966, , % 1, , % 17.6% 3,450 3, ,636 $1.22 Total 9,077,759 1,129, % 211,304 1,340, % 12.3% (47,965) (47,965) ,224 $1.18 WEST CENTRAL PC 1,138,224 91, % - 91, % 10.0% 22,411 22, $1.31 CC 1,910, , % - 232, % 13.0% 15,896 15, $1.20 NC 1,756, , % 47, , % 6.5% 11,549 11, $1.30 SC 2,170, , % - 143, % 7.1% 11,757 11, $1.17 Total 6,976, , % 47, , % 9.1% 61,613 61, $1.23 MARKET TOTAL PC 10,134, , % 1, , % 6.4% (7) (7) $1.54 CC 19,117,789 1,252, % 122,133 1,374, % 7.1% 19,389 19,389 33,789 33, ,000 - $1.29 NC 16,066,048 1,413, % 451,867 1,865, % 9.8% (61,327) (61,327) , ,010 $1.49 SC 14,896,721 1,731, % 4,886 1,736, % 11.8% 24,120 24,120 19,800 19, ,796 $1.24 Total 60,214,709 5,047, % 580,286 5,627, % 8.9% (17,825) (17,825) 53,589 53, ,550 1,183,806 $1.36 QUARTERLY COMPARISON AND TOTALS Q ,214,709 5,047, % 580,286 5,627, % 8.9% (17,825) (17,825) 53,589 53, ,550 1,183,806 $1.36 Q ,161,120 4,976, % 354,423 5,330, % 9.6% 234, ,587 65, , ,506 1,385,706 $1.35 Q ,095,269 5,144, % 639,448 5,784, % 10.2% 408, ,996 71, ,069-1,564,516 $1.32 Q ,024,200 5,482, % 618,699 6,101, % 10.2% (37,367) 246, ,000 71,069 1,492,349 $1.31 Q ,024,200 5,445, % 653,842 6,098, % 10.5% 283, ,597 80,000 80, , ,083 $1.30 Q ,944,200 5,648, % 629,228 6,277, % 10.5% 87, ,512 29, , , ,023 $1.30 Q ,914,400 5,706, % 579,499 6,285, % 10.8% 138, ,352 55, , , ,095 $1.26 PC = Power Center CC = Community Center NC = Neighborhood Center SC = Strip Center 25 Las Vegas Research & Forecast Report Q Retail Colliers International

26 Research & Forecast Report LAS VEGAS MULTIFAMILY Q Sales Strong in 2016 > > Multifamily vacancy decreased to 3.2 percent in 2016 > > Southern Nevada expanded its multifamily inventory by 1,680 units in 2016, more than in 2015 and with more to come in 2017 > > Rental rates continued to increase Economic Indicators ELECTRIC Meter Hookups NEW HOME Median Price THIRTY YEAR Mortgage Rate -0.4 According to statistics provided by REIS, multifamily vacancy in Southern Nevada decreased in the fourth quarter of 2016 (the most recent quarter of available data) to 3.2 percent. Vacancy was 0.1 points higher than in the third quarter of 2016 and 1.0 points lower than in the fourth quarter of Class A properties were 3.5 percent vacant in the fourth quarter, the same as last quarter. Class B/C properties were 2.8 percent vacant, 0.1 percentage point higher than one quarter ago. +5.7% +1.3% Market Indicators Points Relative to prior period Q Q1 2017* VACANCY NET ABSORPTION Historical Vacancy Rates and Rental Rates 6.0% $980 COMPLETIONS RENTAL RATE *Projected 5.0% 4.0% 3.0% 2.0% 1.0% $960 $940 $920 $900 $880 Summary Statistics Las Vegas Market Q4-15 Q3-16 Q4-16 Vacancy Rate 4.2% 3.1% 3.2% Asking Rent (PSF, NNN) $915 $950 $ % 4 Q Q Q Q Q Q Q Q Q 2016 $860 Net Absorption YTD (SF) 3,304 2,927 3,101 Vacancy Rate Average Rental Rate New Completions YTD (SF) 1,510 1,388 1,680 High levels of development are not dampening the multifamily market. Overall Asking Rents Per Unit Per Month Q4-15 Q3-16 Q4-16 Class A $1,042 $1,084 $1,099 Class B/C $791 $813 $821

27 All multifamily submarkets had positive net absorption in 2016, Henderson/Green Valley (1,185 units), Northwest/Southwest (997 units), North Las Vegas (266 units), West Central (258 units), University (125 units), Northeast (115 units), Downtown (77 units) and East Las Vegas (47 units). Historical Net Absorption vs. Completions Multifamily projects totaling 1,680 units were completed in 2016 according to REIS, with another 3,042 units under construction, most of them in the Northwest/Southwest submarket and Henderson/ Green Valley submarket. Colliers research identified 4,236 units of multifamily currently under construction. In particular, multifamily development is concentrated along the I-215 Beltway, which runs through those submarkets. The current wave of development may end by early 2018 unless additional developments are proposed in the meantime. The average asking rent for multifamily was $959 per unit in the fourth quarter of 2016, increasing by $9 psf from the third quarter of 2016, and by $44 per unit since last quarter. Class A properties saw asking rates increase by 5.5 percent year-over-year to $1,099 per unit, while Class B/C properties saw a 3.8 percent increase to $821 per unit. Sales (Units) vs. Price Per Unit Unemployment in the Las Vegas-Paradise MSA stood at 5.0 percent as of December 2016, down from 6.2 percent in December From December 2015 to December 2016, total employment in Southern Nevada has increased by 11,400 jobs. The majority of the Valley s new jobs were in professional and business services (+10,900 jobs), leisure and hospitality (+10,300 jobs) and other services (+5,800 jobs). Jobs were lost in retail (-2,100 jobs), transportation and warehousing (-800 jobs) and wholesale (-100 jobs). According to data provided by the Nevada Department of Motor Vehicles, the number of out-of-state driver s licenses turned in to the DMV between January 2015 and December 2016 was 69,270. This is higher than during the same period in 2015 when they reported 61,555 licenses, and suggests that population growth in Southern Nevada is accelerating. Complex Under Construction Submarket Units Cornerstone Apartments & Senior Living Henderson/GV 572 Polaris/Spring Mountain Apartments West Central 471 Evolve Apartment Homes Henderson/GV 774 Elysian at Stone Lake Henderson/GV 360 The Abode Red Rock Northwest/Southwest 308 Loftus Apartments West Central 295 Boulder Pines Family Apartments East Las Vegas 264 Fremont9 Downtown 231 Cordero Pines Family Apartments Northeast 228 South Beach Resort Northwest/Southwest 220 The Mercer Northwest/Southwest 177 Red Rock Pointe Senior Living Northwest/Southwest 128 The Revenant Henderson/GV 111 {we} Apartments Downtown 49 Warmington Solana Apartments Northwest/Southwest 48 TOTAL Las Vegas Research & Forecast Report Q Multifamily Colliers International

28 Demographics Submarket Estimated Households (2016) Renter Occupied (2016) Median Household (2016) Average Household (2016) Proj. Annual Growth Rental Households ( ) Downtown 49,000 65% $31, East 80,000 44% $42, Henderson/Southeast 153,000 37% $62, North Las Vegas 131,000 36% $55, Northeast 49,000 49% $39, Northwest/Southwest 174,000 35% $64, University 36,000 77% $33, West Central 70,000 52% $47, TOTAL 743,000 43% $51, ,802 Source: Claritas Population growth has been a major driver of Southern Nevada s economic growth since Las Vegas birth in 1905, so improvements in population growth are particularly important for the region and the multifamily market in particular. Multifamily sales boomed in the fourth quarter of 2016, with 8,373 units selling at an average sales price per unit of $94,773. This beats the previous peak in the second quarter of 2015 when 7,170 units were sold. Initial estimates for first quarter 2017 sales were also strong, with approximately 3,605 units sold at an average price per unit of $113,000. High levels of development are not dampening the multifamily market. New projects are finding renters, and the vacancy rate is remaining quite low, while asking rents are increasing. Sales hit a new post- Great Recession record, beating sales in 2012 and posting a much higher average sales price and much lower average cap rate. With population growth returning to the Valley, and single-family homes still expensive, we think multifamily will remain in high demand, and thus multifamily investments will remain attractive through Sales Data Units Sold 21,840 17,808 14,019 15,408 22,074 Average Price Per Unit $65,425 $75,600 $73,627 $71,836 $96,720 Cap Rate 7.3% 5.7% 6.0% 7.3% 5.5% 28 Las Vegas Research & Forecast Report Q Multifamily Colliers International

29 215 NORTH LAS VEGAS Significant Multifamily Sales Activity Sedona at Lone Mountain 321 Units - $34,700,000 NORTHEAST $108,000/Unit March Year Built DOWNTOWN Sundance Village 532 Units - $34,000,000 $64,000/Unit February 2017 Year Built WEST WEST CENTRAL 95 EAST Spectrum Apartments 256 Units - $38,350,000 $150,000/Unit December 2016 NORTHWEST/ SOUTHWEST UNIVERSITY Year Built Villas at Green Valley Units - $70,750,000 $117,000/Unit HENDERSON/ GREEN VALLEY December 2016 Year Built La Vie Residences 248 Units - $54,200,000 $153,000/Unit December 2016 Year Built Sales Activity Continued Property Name Sale Date Units Price Price/Unit Year Built Newport Village Apartments Feb $31,510,000 $94, Monterra Apartment Homes Jan $30,500,000 $89, Orchard Club Apartments Feb $27,200,000 $80, Portofino Villas Jan $26,000,000 $93, Emerald Bay Apartments Mar $23,750,000 $71, Source: Real Capital Analytics 29 Las Vegas Research & Forecast Report Q Multifamily Colliers International

30 Market Comparisons - Las Vegas Multifamily Market CLASS TOTAL INVENTORY UNITS CURRENT VACANCY RATE PRIOR QTR VACANCY RATE NET ABSORPTION NET ABSORPTION YTD UNITS CURRENT QTR COMPLETIONS YTD UNIT COMPLETIONS UNDER CONSTRUCTION UNITS PLANNED CONSTRUCTION UNITS TOTAL SALES UNITS AVERAGE PRICE PER UNIT AVERAGE RENTAL RATE DOWNTOWN A 2, % 1.2% ,367 - n/a $892 B/C 13, % 1.8% ,245 $86,218 $770 Total 16, % 1.7% ,367 4,245 $86,218 $791 EAST LAS VEGAS A 6, % 4.0% n/a $931 B/C 9, % 2.3% (23) ,299 $47,671 $791 Total 15, % 3.0% ,299 $47,671 $847 HENDERSON/GREEN VALLEY A 20, % 2.9% (62) , n/a $1,192 B/C 8, % 4.0% $125,847 $1,033 Total 28, % 3.2% (47) 1, ,066 1,006 $123,509 $1,145 NORTH LAS VEGAS A 13, % 3.7% n/a $968 B/C 9, % 3.2% (38) $174,138 $772 Total 22, % 3.5% $174,138 $886 NORTHEAST A 2, % 2.6% (2) n/a $840 B/C 6, % 3.9% (17) $60,000 $762 Total 8, % 3.6% (19) $60,000 $780 NORTHWEST/SOUTHWEST A 17, % 4.4% ,332 2, $185,909 $1,257 B/C 5, % 1.5% ,192 $118,750 $1,110 Total 23, % 3.7% ,332 2,171 1,500 $132,540 $1,203 UNIVERSITY A 2, % 2.3% n/a $1,007 B/C 12, % 3.6% (57) n/a $735 Total 14, % 3.4% (21) n/a $777 WEST CENTRAL A 6, % 4.0% n/a $1,009 B/C 6, % 0.7% (35) (44) n/a $766 Total 13, % 2.2% n/a $881 MARKET TOTAL A 71, % 3.5% 292 2, ,680 3,042 7, n/a $1,099 B/C 71, % 2.7% (118) n/a n/a 7,649 $89,720 $821 Total 143, % 3.1% 174 3, ,680 3,042 7,525 8,373 $94,773 $959 QUARTERLY COMPARISON AND TOTALS Q4-16* 143, % 3.1% 174 3, ,680 3,042 7,525 8,373 $94,773 $959 Q , % 3.1% 846 2, ,388 2, ,161 $77,603 $950 Q , % 3.3% 836 2, , ,170 $113,859 $935 Q , % 4.2% 1,245 1, , ,343 $86,112 $925 Q , % 4.6% 879 3, ,510 1,826 1,345 4,496 $57,811 $915 Q , % 4.9% 766 2, ,152 1,216 1,704 4,077 $78,914 $908 Q , % 5.1% 894 1, ,617 2,222 3,268 $57,114 $898 * Most recent quarter of data Source: REIS Sales Data provided by Colliers International 30 Las Vegas Research & Forecast Report Q Multifamily Colliers International

31 Research & Forecast Report LAS VEGAS MEDICAL OFFICE Q Future Uncertain Ask Again Later > > Net absorption for Southern Nevada medical office has been positive for four straight quarters > > Vacancy increased to 16.3 percent due to inventory expansion > > Asking rates rebounded in the first quarter after dropping at the end of 2016 Southern Nevada s medical office market posted a fourth straight quarter of positive net absorption in the first quarter of 2017, which would be better news if this positive net absorption had also led to lower vacancy rates. Unfortunately, the completion of an 80,000 square foot medical office building in the Henderson submarket meant that vacancy increased. Still, vacancy remains lower than it was one year ago, and asking rental rates saw an increase of $0.05 per square foot (psf) on a full service gross (FSG) basis to $2.19. According to the Nevada Department of Employment, Training and Rehabilitation, Southern Nevada s medical office job market was Historical Vacancy Rates and Rental Rates Economic Indicators HEALTHCARE Employment +6.0% Market Indicators HEALTHCARE Spending MEDICAL SF/Job +3.6% Q Relative to prior period Q Q2 2017* VACANCY NET ABSORPTION COMPLETIONS RENTAL RATE *Projected 18.0% $2.20 Summary Statistics Las Vegas Market Q1-16 Q4-16 Q % $2.18 Vacancy Rate 17.1% 15.7% 16.3% 16.0% $2.16 Asking Rent (PSF, NNN) $2.18 $2.14 $ % $2.14 Net Absorption (SF) -21,820 47,040 20, % $2.12 New Completions (SF) , % $ % 1 Q Q Q Q 2015 Vacancy Rate 1 Q Q Q Q 2016 Rental Rate 1 Q 2017 $2.08 Overall Asking Rents Per Square Foot Class A $2.59 $2.63 $2.67 Class B $2.23 $2.20 $2.20 Whatever else the repeal/reform efforts accomplish, they will create uncertainty, and that can potentially retard growth in the medical real estate sector. Class C $1.79 $1.79 $1.82

32 a mixed bag in January 2017 (the latest month of data available) compared with January Jobs in the healthcare and social assistance sector decreased by 100. Digging into the numbers a bit revealed that ambulatory health care jobs, which have the largest impact on the medical office market, remained stable at 38,100 jobs (of which about 16,700 are in the medical office buildings tracked in this report). Hospital jobs increased by 500 year-over-year. Unemployment in the Las Vegas-Paradise MSA stood at 5.1 percent as of January 2017, down from 6.5 percent in January From January 2016 to January 2017, total employment in Southern Nevada has increased by 37,500 jobs. The Nevada Department of Taxation reported that taxable spending on ambulatory health care services in Clark County over the past twelve months (December 2015 to November 2016, the most recent months of data available) totaled $79.4 million dollars, a 12.8 percent increase in spending over the previous twelve months (December 2014 to November 2015). It is still unclear whether this increase in taxable spending is due to more healthcare being purchased versus how much that healthcare costs, and therefore how great an impact it is ultimately having on demand for medical office space. Historical Net Absorption vs. Completions Healthcare Jobs vs. Occupancy Rate 84.5% 84.0% 83.5% 17,000 16,500 16,000 Until this quarter, Southern Nevada had not seen the completion of medical office since the second quarter of 2015, when 16,000 square feet was added to inventory. In the first quarter of 2017, a new Class A medical office building on the campus of the new Henderson Hospital at 83.0% 82.5% 82.0% 15,500 15,000 14,500 Union Village was completed, adding 80,000 square feet to inventory. 81.5% 14,000 More medical office on and around that campus are planned for the future. An 80,000 square foot Class A medical office building is still 81.0% 1 Q Q Q Q Q Q Q Q Q ,500 under construction at Tenaya Way and Cheyenne Avenue, and should Healthcare Jobs Occupancy Rate be completed in early In addition, several new small hospitals for urgent or emergency care are planned in the Valley, including the 100,000 square foot Southern Hills Emergency Hospital at Desert Inn & Fort Apache, and four small hospitals being developed by Dignity Health at Craig & Camino Al Norte, Blue Diamond & Decatur, Flamingo & I-215 and Decatur & Sahara. Vacancy in medical office space increased in the first quarter of 2017 to 16.3 percent, an increase of 0.6 points from last quarter, but a decrease of 0.8 points from one year ago. Much of the increase was due to the aforementioned completion of the new medical office building in the Henderson submarket, which was not 100% preleased when completed. Net absorption has been positive for three straight quarters, and should it remain positive, we should see vacancy begin to decrease again next quarter. The highest vacancy rates this quarter were in the Southwest (33.6 percent), Airport (20.2 percent) and West Central (17.5 percent) submarkets. The lowest vacancy rate was in Northwest (12.0 percent), 32 Las Vegas Research & Forecast Report Q Medical Office Colliers International

33 followed by Downtown (12.5 percent) and North Las Vegas (12.5 percent). Vacancy increased on a quarterly basis in the Northwest, Henderson, Southwest and West Central submarkets, with the largest increase occurring in the Northwest submarket (+1.8 points). Vacancy decreased in North Las Vegas, East Las Vegas and Downtown, with the largest decrease being in the North Las Vegas submarket (-6.4 points). Vacancy remained stable in the Airport submarket. Four straight quarters of positive net absorption may not seem like a major run, but for Southern Nevada s beleaguered medical office market it is very good news. While 2015 remains the strongest recent year of performance for the market, the past four quarters have produced 123,617 square feet of net absorption, bringing vacancy down from 17.1 percent to 16.3 percent, with inventory growth over the period of 80,000 square feet. The weighted average asking rental rate for medical office space in the first quarter of 2017 was $2.19 psf FSG. This was $0.05 lower than at the end of 2016 and $0.01 higher than one year ago. Asking rates have now matched the previous high posted in the fourth quarter of At least some of this rise is due to the addition of new vacant Class A office space to the market, although asking rate growth was also seen in Class C buildings. One year ago, effective lease rates were approximately 90 percent of asking lease rates, and therefore indicated that asking rates may decrease. We are now seeing effective lease rates in medical office at approximately percent of asking rates. Looking at healthcare companies, regardless of the kind of space they occupy, we see a similar trend, though one that might be beginning to flag. The lowest average asking rate for medical office space in the first quarter was in the North Las Vegas submarket at $1.67 psf, followed by West Central ($1.72 psf) and the Airport submarket ($1.92 psf). The Valley s highest asking rate was in Henderson at $2.48 psf, followed by Northwest ($2.42 psf) and Southwest ($2.28 psf). The largest increase in the weighted average asking rate was in Henderson, at $0.11 psf, due in part to the completion of the new Class A medical office building there. The largest decrease was $0.18 psf in the North Las Vegas submarket. Investment sales volume of medical office in the first quarter of 2017 amounted to $33.1 million in five sales totaling 82,000 square feet, with an average sales price of $ psf. These buildings had an average cap rate of 6.4 percent. By comparison, investment sales volume in 2016 was $79.5 million, with an average sales price of $ psf and an average cap rate of 6.8 percent. Investors are feeling confident in the future of Southern Nevada s medical office market. Owner/user sales volume of medical office in the first quarter of 2017 amounted to $1.6 million in three sales totaling 18,000 square feet, with an average sales price of $91.62 psf. In contrast, investment sales volume in 2016 was $8.3 million, with an average sales price of $ psf. Southern Nevada s medical office market, which has had some rough years of late, is now performing well. Net absorption has been positive for four quarters and asking rates are climbing. Vacancy is still higher than would be considered healthy, but it has improved over the past four quarters. Of course, the elephant in the room is the ACA and its future. Extracting the ACA from the healthcare industry was by design always going to be tricky, and current efforts at doing so are already meeting resistance. Whatever else the repeal/reform efforts accomplish, they will create uncertainty, and that can potentially retard growth in the medical real estate sector. We think that the positive trends we have seen in the market should continue, but that the continued healthcare debate in Washington D.C. leaves the future difficult to predict. Southern Nevada s medical office market posted a fourth straight quarter of positive net absorption... - John Stater, Research & GIS Manager 33 Las Vegas Research & Forecast Report Q Medical Office Colliers International

34 215 NORTH LAS VEGAS Significant Medical Office Sales Activity 7250 Cathedral Rock NORTHWEST ,000 SF - $14,365,000 $653/SF December 2016 Class C 2065 North Las Vegas SUMMERLIN WEST CENTRAL DOWN TOWN EAST LAS VEGAS 10,000 SF - $3,245,000 $318/SF December 2016 Class C 150 South Valley View 12,000 SF - $5,686, $474/SF December 2016 Class C AIRPORT 150 East Harmon ,000 SF - $7,450,000 $289/SF January 2017 SOUTHWEST HENDERSON Class C Horizon Ridge Commons 12,000 SF - $2,370,000 $200/SF January 2017 Class C Significant Lease Activity Property Name Lease Date Lease Term Size Lease Rate Tenant 1330 Valley View Jul months 18,100 SF $1.69 NNN Physicians Siena Pavilion Oct months 11,200 SF $1.12 NNN Physicians Durango Medical Plaza Jul months 6,900 SF $1.87 NNN Fertility Clinic Rainbow Office Complex Oct months 1,500 SF $0.69 NNN Financial Pageantry Horizon Park Jan months 1,000 SF $1.40 MG Physician 34 Las Vegas Research & Forecast Report Q Medical Office Colliers International

35 Market Comparisons - Las Vegas Medical Office Market TYPE TOTAL INVENTORY SF DIRECT VACANT SF DIRECT VACANCY RATE SUBLEASE VACANT SF TOTAL VACANT SF VACANCY RATE CURRENT QUARTER VACANCY RATE PRIOR QUARTER NET ABSORPTION CURRENT QTR SF NET ABSORPTION YTD SF COMPLETIONS CURRENT QTR SF COMPLETIONS YTD SF UNDER CONSTRUCTION SF PLANNED CONSTRUCTION SF WEIGHTED AVG ASKING RENTAL RATE AIRPORT SUBMARKET A - - n/a - - n/a n/a $- B - - n/a - - n/a n/a $- C 38,000 7, % - 7, % 20.2% $1.92 Total 38,000 7, % - 7, % 20.2% $1.92 DOWNTOWN SUBMARKET A 65, % % 0.0% ,000 $- B 227,301 35, % - 35, % 15.7% $2.05 C 86,997 11, % - 11, % 16.1% 2,110 2, $2.55 Total 379,298 47, % - 47, % 13.1% 2,110 2, ,000 $2.17 EAST LAS VEGAS SUBMARKET A - - n/a - - n/a n/a $- B 669, , % 5, , % 23.3% 4,518 4, $2.09 C 616,007 38, % - 38, % 7.7% 9,253 9, $1.84 Total 1,285, , % 5, , % 15.8% 13,771 13, $2.04 HENDERSON SUBMARKET A 501,834 76, % - 76, % 11.2% 50,982 50,982 80,000 80, $2.98 B 334, , % - 103, % 30.3% -4,155 (4,155) $2.21 C 604,216 33, % 3,706 37, % 6.0% -1,159 (1,159) ,000 38,000 $2.16 Total 1,440, , % 3, , % 13.6% 45,668 45,668 80,000 80,000 27,000 38,000 $2.48 NORTH LAS VEGAS SUBMARKET A - - n/a - - n/a n/a $- B 43,921 8, % - 8, % 19.8% $1.00 C 169,143 17, % - 17, % 18.6% 13,625 13, $2.00 Total 213,064 26, % - 26, % 18.9% 13,625 13, $1.67 NORTHWEST SUBMARKET A 807, , % 6, , % 11.8% (41,768) (41,768) ,251 - $2.61 B 1,031, , % - 108, % 10.5% $2.24 C 202,434 7, % - 7, % 6.1% 5,000 5, $1.83 Total 2,041, , % 6, , % 10.6% (36,768) (36,768) ,251 - $2.42 SOUTHWEST SUBMARKET A 115,300 44, % - 44, % 38.3% $2.31 B 438, , % 4, , % 40.2% (10,652) (10,652) $2.36 C 275,170 51, % - 51, % 18.8% $1.95 Total 828, , % 4, , % 32.8% (10,498) (10,498) $2.28 WEST CENTRAL SUBMARKET A - - n/a - - n/a n/a $- B 291,027 32, % - 32, % 11.3% $2.19 C 870, , % - 170, % 18.8% (6,919) (6,919) $1.63 Total 1,161, , % - 203, % 16.9% (6,919) (6,919) $1.72 MARKET TOTAL A 1,489, , % 6, , % 13.2% 9,214 9,214 80,000 80,000 80, ,000 $2.67 B 3,035, , % 10, , % 20.4% (10,289) (10,289) $2.20 C 2,862, , % 3, , % 12.8% 22,064 22, ,000 38,000 $1.82 Total 7,387,532 1,206, % 20,562 1,227, % 16.0% 20,989 20,989 80,000 80, , ,000 $2.19 QUARTERLY COMPARISON AND TOTALS Q1-17 7,387,532 1,206, % 20,562 1,227, % 16.0% 20,989 20,989 80,000 80, , ,000 $2.19 Q4-16 7,307,532 1,147, % 23,077 1,170, % 16.6% 47,040 80, , ,000 $2.14 Q3-16 7,307,532 1,194, % 19,301 1,213, % 17.4% 54,493 33, ,251 80,000 $2.15 Q2-16 7,307,532 1,249, % 23,007 1,272, % 17.2% 1,095 (20,725) , ,000 $2.14 Q1-16 7,307,532 1,250, % 6,955 1,257, % 16.9% (21,820) (21,820) ,931 $2.18 Q4-15 7,307,532 1,228, % 8,955 1,237, % 16.8% (25,501) 149,292-16, ,931 $2.19 Q3-15 7,307,532 1,202, % 22,436 1,225, % 16.6% (6,806) 174,793-16, ,931 $ Las Vegas Research & Forecast Report Q Medical Office Colliers International

36 Research & Forecast Report LAS VEGAS HOTEL Q Hospitality Firing on All Cylinders > > A record visitor volume in 2016 might be hard to beat in 2017 without additional room and new venues > > Room inventory growth will remain light until 2019 > > Hospitality sales were light in the first quarter of 2017 After strong numbers in 2016, Southern Nevada s hospitality market posted growth in most areas in January 2017, but saw only light sales in the first quarter of Visitor volume in January of 2017 was 3.51 million visitors, very slightly higher than in January of January gaming revenue was also stronger in 2017 than 2016, with $926 million taken in in the first month of 2017 compared to $811 million in the first month of The average daily room rate (ADR) and revenue per available room (RevPAR) were also up year-overyear. Room inventory did not increase in any meaningful way in 2016, and construction should remain light in 2017 as well. While gaming revenue continued to lag behind the peak levels it reached in 2006 and 2007, it has showed improvement since the Great Recession. Gaming revenue in January of 2017 posted 14.3 percent year-over-year growth for Clark County as a whole, and 14.4 percent growth on the Las Vegas Strip in particular. The Downtown submarket had 32.0 percent gaming revenue growth year-over-year, and the Boulder Strip, which primarily plays host to local casino Revenue Per Available Room RevPAR (RevPar) $ $ $ $80.00 $60.00 $40.00 Economic Indicators AIR Passengers +4.2% Market Indicators Relative to prior period Q Q2 2017* Room Inventory Room Occupancy Average Daily Rate Revenue Per Available Room *Projected Summary Statistics CONVENTION Attendance -5.2 RevPAR Oct % Las Vegas Market Q1, 2016 Q4, 2016 Q1, 2017 Room Inventory 140, , ,332 Room Occupancy 87.9% 86.3% 85.7% Average Daily Rate $ $ $ Revenue Per Available Room $ $ $ $20.00 $ Q Q Q Q Q Q Q Q Q 2017 Should the hospitality market continue to be healthy, and the national economy healthy along with it, we think hospitality sales will improve as 2017 wears on.

37 patrons, posted 24.5 percent gaming revenue growth. One month does not necessarily set the pace for the entire year, but strong numbers in January is certainly nice to see. Room inventory neither expanded nor contracted in the first quarter of Resorts World Las Vegas remained under construction, with completion of the first phase planned for 2019, along with Steve Wynn s 1,000-room Paradise Park project that will be constructed on the former site of the Desert Inn Golf Course. Southern Nevada experienced a non-gaming construction boom in 2016, with such additions as Topgolf International s four-story golf entertainment complex at the MGM Grand, a 415,085 square foot IKEA store along the I-215 Beltway, new retail fronting the Treasure Island, the Rock N Rio festival, and the 20,000 seat MGM Resorts International s T-Mobile Arena behind New York-New York and Monte Carlo which will host Las Vegas NHL hockey franchise the Golden Knights. While the road to moving the Oakland Raiders NFL franchise to Las Vegas has been bumpy, it still looks to be on track at the moment should see a $75 million renovation of Caesars Palace s original Roman Tower, a new a 5,000-seat, The Park Theatre at the Monte Carlo and a $47 million renovation of the Thomas & Mack Center. The Las Vegas Convention Center is planning a major expansion of the convention center to keep Southern Nevada at the forefront of convention destinations in the United States. In all, we expect approximately $12.5 billion spent on hospitality development between 2017 and Hospitality sales were light in the first quarter of 2017 in terms of sales volume, though when measured by number of rooms it was a very good quarter. A total of 2,035 rooms sold, with total sales volume of $58.5 million and an average sales price of $28,740 per room. Hospitality sales volume in 2016 exceeded $1 billion, with 4,415 rooms selling at an average price per room of $267,643. Sales volume also exceeded $1 billion in 2014 and Sales were dominated in 2016 by large resorts, including the Tropicana Las Vegas, Aliante Hotel and Casino and Palms Casino Resort. Sales Volume $800,000,000 $700,000,000 $600,000,000 $500,000,000 $400,000,000 $300,000,000 $200,000,000 $100,000,000 $0 31 Q Q Q Q Q Q Q Q Q Sales vs. Price Per Unit 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Sales Volume 4 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q 2017 Sales (Units) Sales vs. Price Per Unit Average Price Per Unit $2,000,000 $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 Market Health Data Point YTD* Visitor Volume (millions) Room Occupancy 84.3% 86.8% 87.7% 89.1% 85.7% ADR $ $ $ $ $ RevPAR $93.27 $ $ $ $ Convention Attendance (millions) Passengers McCarran Int l (millions) Gaming Revenue (Clark County; billions) $10.0 $9.6 $9.6 $9.7 $0.9 Gaming Revenue ( Strip ; billions) $6.5 $6.4 $7.5 $6.4 $0.6 Data from Las Vegas Convention & Visitors Authority * Data from January 37 Las Vegas Research & Forecast Report Q Hospitality Colliers International

38 While sales volume of hospitality was light in the first quarter, all signs are that the hospitality market will continue to thrive in While it may be difficult to best 2016 s visitor volume record in 2017, there are no indications that visitor volume or any other measures of the hospitality market are poised for a dramatic fall. Should the hospitality market continue to be healthy, and the national economy healthy along with it, we think hospitality sales will improve as 2017 wears on. Hospitality Sales* Year Volume Units Sold Price/Unit 2017 YTD $63 MM 2,158 $29, $1,182 MM 4,415 $268, $466 MM 5,445 $86, $2,001 MM 7,614 $263, $61 MM 1,335 $46, $160 MM 3,120 $51, $3,005 MM 7,507 $400, $858 MM 8,883 $97,000 * Only includes properties with 100 or more units, arm s-length sales 38 Las Vegas Research & Forecast Report Q Hospitality Colliers International

39 Significant Hotel Sale Activity NORTHWEST 215 NORTH LAS VEGAS Aliante Hotel and Casino Casino Hotel - $380,000, Units - $1,881,000/Unit 95 September 2016 Casino Hotel - North Vegas 15 Tropicana Las Vegas Casino Hotel - $360,000,000 1,497 Units - $240,000/Unit December 2015 SUMMERLIN WEST CENTRAL DOWNTOWN RESORT CORRIDOR EAST LAS VEGAS Casino Hotel - Strip Palms Casino Resort Resort Corridor - $315,500,000 THE STRIP Units - $440,000/Unit October 2016 Casino Hotel - Resort Corridor 215 AIRPORT Westin-Las Vegas Casuarina Resort Corridor - $66,530,000 SOUTHWEST SOUTH LAS VEGAS HENDERSON 826 Units - $81,000/Unit January 2016 Casino Hotel - Resort Corridor The Orleans Hotel Resort Corridor - $$42,986,000 1,885 Units - $23,000/Unit February 2017 Casino Hotel - West Vegas Sale Activity Continued Property Name Sale Date Units Price Price/Unit Submarket Property Type Westin-Lake Las Vegas Dec $25,000,000 $51,000 Henderson Full Service Element Hotel Apr $17,100,000 $139,000 Summerlin Full Service Serene Vegas Jan $15,500,000 $103,000 Resort Corridor Full Service Extended Stay America Dec $4,550,000 $37,000 East Vegas Limited Service Starlite Motel Dec $1,000,000 $32,000 North Vegas Limited Service * Indicates a redevelopment sale 39 Las Vegas Research & Forecast Report Q Hospitality Colliers International

40 Market Comparisons - Las Vegas Hospitality Market TYPE TOTAL INVENTORY (UNITS) TOTAL SALES (UNITS) TOTAL SALES VOLUME AVERAGE SALES PRICE PER UNIT COMPLETIONS CURRENT QUARTER (UNITS) COMPLETIONS YTD (UNITS) CURRENT DEVELOPMENT (UNITS) DOWNTOWN CAS 7,428 - $0 n/a FS - - $0 n/a LS $0 n/a Total 7,972 - $0 n/a LAS VEGAS STRIP CAS 80,166 - $0 n/a - - 4,500 FS 5,450 - $0 n/a LS $0 n/a Total 86,112 - $0 n/a - - 4,500 RESORT CORRIDOR CAS 11,436 - $0 n/a FS 4,004 - $0 n/a LS 5, $15,500,000 $103, Total 21, $15,500,000 $103, AIRPORT CAS - - $0 n/a FS - - $0 n/a LS 1,009 - $0 n/a Total 1,009 - $0 n/a EAST LAS VEGAS SUBMARKET CAS 1,703 - $0 n/a FS - - $0 n/a LS 2,619 - $0 n/a Total 4,322 - $0 n/a HENDERSON SUBMARKET CAS 2,035 - $0 n/a FS $0 n/a LS 1,465 - $0 n/a Total 4,232 - $0 n/a NORTH LAS VEGAS SUBMARKET CAS $0 n/a FS - - $0 n/a LS 1,413 - $0 n/a Total 2,400 - $0 n/a SOUTH LAS VEGAS SUBMARKET CAS 2,853 - $0 n/a FS $0 n/a LS 1,333 - $0 n/a Total 4,632 - $0 n/a SUMMERLIN SUBMARKET CAS 1,770 - $0 n/a FS $0 n/a LS $0 n/a Total 2,574 - $0 n/a WEST CENTRAL SUBMARKET CAS 3,425 1,885 $42,985,872 $22, FS - - $0 n/a LS 2,503 - $0 n/a Total 5,928 1,885 $42,985,872 $22, MARKET TOTAL CAS 111,803 1,885 $42,985,872 $22, ,500 FS 10,755 - $0 n/a LS 17, $15,500,000 n/a Total 140,332 2,035 $58,485,872 $28, ,670 QUARTERLY COMPARISON AND TOTALS Q ,332 2,035 $58,485,872 $28, ,670 Q , $692,500,000 $758, ,521 Q ,332 - $0 n/a ,137 Q , $23,600,000 $70, ,167 Q ,208 3,168 $465,543,841 $146, ,925 Q ,208 - $0 n/a 0 2,376 3,634 Q , $151,000,000 $157, ,376 3, Las Vegas Research & Forecast Report Q Hospitality Colliers International

41 Research & Forecast Report LAS VEGAS LAND Q Slow but Solid Start to 2017 > > 2017 s first quarter saw a slight decrease in land sales > > Prices were a mixed bag; down slightly for commercial, up for industrial, flat for residential > > Strong development of multifamily and industrial properties continued; residential construction up Economic Indicators COMMERCIAL Forward Supply RESIDENTIAL Permits COMMERCIAL Permits The first quarter of 2017 saw land sales decrease, compared to a quarter ago and compared to one year ago. In the first quarter there were 60 land sales totaling acres with a total sales volume of $142.8 million. The average sales price for land in Southern Nevada in the first quarter of 2017 was $7.22 per square foot (psf), higher than in 2016 when large industrial land sales at Apex drove the average price per square foot lower, and a modest improvement over the last five years. Occupancy in industrial buildings decreased to 94.0 percent in the first quarter of 2017 due to very strong development of new warehouse/ distribution buildings. A total of 2.0 million square feet of industrial space was completed in the first quarter of 2017 on acres. An additional million square feet of industrial space is either under construction or planned on 1,082.1 acres of land. During the first quarter, 55.0 acres of industrial land was sold, with total sales volume of $20.4 million. The average sales price of industrial land was $8.50 psf, a tremendous decrease from 2016 due to the impact of large parcel sales at Apex in Market Indicators Relative to prior period Q Q2 2017* NO. SALES ACREAGE SOLD SALES VOLUME PRICE PER SQUARE FOOT *Projected Land Sales Activity 2,000 1,800 Percent Percent Percent $10.00 $9.00 Occupancy in commercial buildings decreased in the first quarter of 2017 to 87.6 percent, 0.3 percentage points lower than in This decrease was due primarily to the retail market, which has just finished its second expansion since the end of the Great Recession. Speculative construction of office and retail product is not as strong as of industrial product, but increased in the first quarter of A total of 135,397 square feet of commercial product was completed in the first quarter on acres. An additional 2.8 million square feet of commercial product is under construction or planned on ,600 1,400 1,200 1, Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 ACREAGE SOLD PPSF $8.00 $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00

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