213 West Institute Place

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1 A Prime Opportunity within Chicago s Premier River North Neighborhood E X E C U T I V E S U M M A R Y

2 E X E C U T I V E S U M M A R Y (the Property ) is a 9.% leased loft office building located in Chicago s dynamic River North neighborhood, Chicago s most vibrant, mixed-use community. The Property consisting of 8,99 rentable square feet ( RSF ) has an average in-place rental rate that is 9% below market rents for class B properties in River North. Built in 9 the Property has been subject to continual enhancements throughout its history to satisfy today s demanding office user. The Property allows investors the rare opportunity to reposition the building by potentially adding a tenant amenities such as a fitness center, conference center or rooftop deck. The urban sightlines would increase rents and leasing velocity. Investors could also add value through lobby and corridor renovations to showcase the brick & timber nature of the building. The River North area of Chicago has evolved into one of the city s most vibrant restaurant and entertainment districts, and has seen a surge in hotel and residential development as a result. As such, this area had become a popular destination for the residents and workers of the Chicago metro area as well as for the many visitors to the city. With the many trade shows that are held annually at the nearby Merchandise Mart, the area welcomes millions of visitors every year, making River North s package of dining, entertainment and lodging options an ideal nearby amenity. The Property is easily accessible to major expressways via the Ohio/Ontario Street feeder ramp and Lake Shore Drive via automobile. Public transportation is made easy as The Property is in extreme proximity to the CTA Brown/Purple Line Chicago Avenue stop at just a ½ block walk southwest. Air transportation services are provided by O Hare International Airport (approximately miles to the northwest) and Midway Airport (approximately miles to the southwest). Additionally, bus service is available along the primary roadways. ADDRESS: KEY PROPERTY STATISTICS, Chicago, IL NEIGHBORHOOD: River North YEAR BUILT: 9 RENTABLE AREA: 8,99 RSF PERCENT LEASED: 9.% STORIES: 7 CURRENT ZONING: C- BASE FAR: 6.90 LAND SITE: 0.9 Acres The Property fills a rare niche within the market - a small office building in Chicago s River North submarket which appeals to tenants seeking economical space, while providing all the amenities that have made the area a true /7 scene. River North s overflowing population of tech tenants are drawn to the open, creative space that offers due to the brick & timber construction of the asset. Institute presents the opportunity for an investor to acquire a historically well occupied asset, in a superior CBD location, at a low-cost basis with future upside in boosting short term below market rents.

3 E X E C U T I V E S U M M A R Y Value Add Opportunity The Property checks all the boxes for an excellent opportunistic investment; current vacancy, attractive basis, appeal to technology tenants, an extremely favorable financing environment as well as a realistic and readily achievable exit strategy. The Property is currently 9.% leased to a diverse tenant base with.7 years of weighted average lease term. Furthermore, the average in-place rent of the current tenant base is 9% below class B properties in the River North submarket. The creative open floor plan at Institute attracts tenants from a variety of industries including advertising, medical services, education, and more. The diverse tenancy, which further provides income stability, is attracted to the Property due to the accommodating floor plate of approximately,000 RSF, which effectively caters to full floor tenants, while also allowing efficient layout for smaller firms. DIVY BIKES NEAR WEST INSTITUTE GALAMBOS SPACE

4 E X E C U T I V E S U M M A R Y A E D C Wabash Avenue B River North Hotel/Residential Development The River North market has seen a recent flurry of hotel development. Over,800 rooms have been proposed, under construction or completed since. Additionally, developers have begun to minimize some of the cap rate compression in Chicago s multifamily market through an influx of new high-rise development. Examples of Hotel/Multifamily development in the River North area include; HOTEL DEVELOPMENTS Fairfield Inn & Suites Marriott 80 Hyatt Place Hyatt Langham Oxford/Langham 0 Godfrey Chicago Oxford One North Franklin Aloft Chicago City Center Name Starwood Hotels Company 7 Rooms Year Built Wa e RESIDENTIAL DEVELOPMENTS A B C D E Chestnut & Franklin River North 67 W. Erie Street River North Domus Group Magellan Units Start Date Under Construction Q 0 LaSalle & Chicago River North Smithfield Properties, LLC 9 TBD 8 North State Gold Coast Developer 70 North LaSalle River North MAC Management \ Magellan 00 TBD Address Neighborhood Newcastle, Ltd. 67 Under Construction

5 E X E C U T I V E S U M M A R Y FARMHOUSE NEAR WEST INSTITUTE CTA STATION ACROSS FROM WEST INSTITUTE LOBBY

6 E X E C U T I V E S U M M A R Y Upside Potential The gap between current in place rents at and current market rents provides an opportunity for a new investor to increase future revenues. The average in-place rental rate at the Property is approximately 9% below market. A new investor can capitalize on future market improvements by marking leases to market as they come up for renewal, substantially enhancing the asset s return throughout the holding period. Additionally, is 9.% leased. This offers tremendous upside potential through the lease-up of existing vacant space. The exposed brick, high ceilings of the Property appeal to the exploding tech scene seeking creative, alternative space within the submarket. The Property presents an excellent opportunity to increase the in-place net operating income from $.9 million to a projected stabilized income of approximately $.6 million, a 7% increase in net operating income. West represents a unique opportunity to acquire a highquality loft property in a thriving River North location with substantial upside to a prospective purchaser. TEXTASSIST SPACE Limiting Turnover & Drawing New Tenants Since acquiring the asset in September of, ownership has been a perfect 9 for 9 in retaining tenants at the property. Moreover, ownership has increased occupancy from 6.% to 9.% in just a few months, further solidifying the quality and desirability of a prime loft building in an often sought after River North location. Disappearance of Value Office is one of few remaining value office buildings in the CBD that can offer tenants quality office finishes in an outstanding location with an economical rental rate under $.00 PSF gross. In the last decade, Chicago has lost a significant amount of value office space to residential conversion. More recently the city has conceded value office buildings to hotel conversions, including Virgin Hotel Chicago at 0 North Wabash, Hotel Indigo at 68 North Michigan, and JW Marriott Hotel on floors two through twelve of 08 South LaSalle. 0 North Wabash converted the lower 00,000 RSF to a high-end Langham Hotel. Recently initiated conversions from office to student-oriented housing include 0 & 8 East Jackson, along with the Old Colony Building at 07 South Dearborn. The on going repositioning of significant CBD value office buildings including 00 West Adams, the Civic Opera building and River Center also continue to contribute to the diminishing supply. 6

7 E X E C U T I V E S U M M A R Y DISA PPE A RA N CE O F VA L U E O F F IC E HOTEL CONVERSION STUDENT HOUSING 0 CONVERSION RESIDENTIAL CONVERSION OFFICE REPOSITIONING 08 South LaSalle 0 North Wabash 0 North Wabash 68 North Michigan 00 West Monroe 60 North Michigan South LaSalle 9 South LaSalle 0 East Erie 0 & 8 East Jackson Old Colony Building 6 North Michigan East Monroe 88 West Randolph 00 North Michigan West Randolph 00/0 N. Michigan South Clark 0 S Wacker 00 W Adams W Jackson Civic Opera House River Center Total RSF Affected,7 7,6 00,000 80,000 0,976 60,8 90,000 0,8 7,600,9 7,60 96,000 0,000 6,70 0,000 0,000 9,000 07,90,96,87 67, Completion ,000 90,000 7,,6 Comments Conversion of floors through to JW Marriott Hotel Conversion to Virgin Hotel Chicago; to be delivered Fall Conversion to Langham Hotel Conversion to Hotel Indigo; to be delivered early 0 Initial stages of preparing for conversion to hotel Conversion to boutique hotel conversion to a 80-room Marriott Residence Inn conversion to a -room Kimpton Hotel Former DraftFCB building proposed conversion to hospitality $7M conversion to 60-unit rental complex geared toward graduate students $0M conversion to 0-unit rental complex with student target-market Conversion to 0 luxury condominium units Converted office space to condominium Conversion to -unit residential apartments conversion to residential conversion to 0-unit loft apartment units Conversion to multi-family Conversion to apartments $0M renovation undertaken; majority of building then leased to MillerCoors $M renovation undertaken to reposition asset $0M renovation undertaken; subsequently leased to several full floor users Multi-million dollar renovation includes vacating small tenants, catering to larger users Multi-million dollar renovation to reposition asset as hub for larger high-tech tenants 7

8 E X E C U T I V E S U M M A R Y River North is the epicenter of a dense, /7, entertainment district that is packed with bars, restaurants, shopping and hotels. Dining and Entertainment The Hubbard and Kinzie Street corridors, which run from Orleans Street to Wabash, form the backbone of Chicago s River North neighborhood. This corridor is universally regarded as the most desirable area in which to dine and be entertained -hours a day, seven-days per week. Similarly, the Randolph Street and Fulton Street corridors, which run from Clinton Street to the west for several blocks, are home to some of Chicago s most cutting edge restaurants and bars. The Property itself is home to the newest version of the Headquarters Beercade; featuring craft beers, cocktails, delicious food and vintage arcade games in a,000 square foot setting. Chicago Loop The Chicago Loop office market consists of over 0 million square feet of office space which house over 70,000 office workers daily. Employers realize they must locate Downtown in order to attract the best/most skilled workforce, and this has been evident in major Fortune 00 employers relocating jobs to Downtown Chicago in recent years including Boeing, General Electric, Google, Hilshire Brands, Miller-Coors and United Airlines. Galleries The River North Gallery District hosts the largest concentration of art galleries in the United States outside of Manhattan. The District is home to hundreds of galleries and is generally defined as the area north of the Merchandise Mart, south of Chicago Avenue, east of Orleans Street and west of LaSalle Boulevard. The abundant and diverse gallery offerings attract high-end consumers, cultural patrons, and engage residents of the River North community. River North is the hub of job growth and new office supply in the region. Notable Tenants in the River North / North Michigan Avenue Submarkets Kirkland & Ellis 00 N LaSalle 60,000 Lenova (Motorola Solutions) Merchandise Mart 7,000 Jenner & Block N Clark,678 Groupon 600 W Chicago,000 lnterpublic 87 N Michigan Avenue 9,000 American Medical Association 0 N Wabash 7,000 ABA N Clark 0,000 Wrigley Corp. 600 W Chicago 7,000 Foley & Lardner LLP N Clark 7,000 NBC N Cityfront Plaza 8,000 Latham & Watkrns 0 N Wabash,000 The Boston Consulting Group 00 N LaSalle,000 Smith Bucklin 0 N Wabash 0,000 Spencer Stuart N Clark 07,000 SPIN ARTISTS LOBBY 8

9 E X E C U T I V E S U M M A R Y Gateway City Chicago s pro-business attitude, a highly-skilled workforce, culturally diverse population, low-cost of living, high quality of life, comprehensive transportation system and diverse economy give the city a commanding and compelling economic profile. Chicago is recognized as one of the most important industrial, financial, and cultural centers in the United States. Chicago s mid-continent location and efficient access via air, land and water have made it the central hub of the United States. Chicago thrives on its strong, diverse, and growing economic base not only in manufacturing, but also in wholesale and retail trade, communications, publishing, banking, finance, insurance, law, advertising, accounting, medicine and high technology. O AVENUE NORTH MICHIGAN AVENUE AND AVENUE ORLEANS STREET 6 7 RANDOLPH STREET WASHINGTON STREET WACKER DRIVE 6 9 FRANKLIN STREET WELLS STREET 6 LASALLE STREET HUBBARD STREET WACKER DRIVE LASALLE STREET 7 CLARK STREET 7 SUPERIOR STREET 8 CLARK STREET 8 0 DEARBORN STREET DEARBORN STREET C STATE STREET H OAK STREET HURON STREET I RUSH STREET HUBBARD STREET CORRIDOR CHICAGO LOOP WABASH AVENUE C A G O MAGNIFICENT MILE MICHIGAN AVENUE Street Beach LAKE STREET ST CLAIR STREET WALTON PLACE DELAWARE PLACE CHESTNUT STREET PEARSON STREET OHIO STREET R I V E R Millennium Park FAIRBANKS COURT CHICAGO AVENUE RANDOLPH STREET LAKE SHORE DRIVE NORTHWEST MEMORIAL HOSPITAL CAMPUS ERIE STREET ONTARIO STREET MCCLURG COURT ILLINOIS STREET Legend RESTAURANTS Farmhouse Yolk Nacional 7 Prosecco Bistro Voltaire 6 mk Chicago 7 Parliament Chicago 8 American Junkie 9LAKE Ay Chiwowa MICHIGAN 0 RPM Italian BlackFinn AmeriPub Bub City Cantina Laredo Coco Pazzo Gene & Georgetti 6 Fleming s Prime Steakhouse 7 Fogo de Chao 8 Hard Rock Café Navy Pier 9 Harry Caray s 0 Hub John Barleycorn River North Kinzie Chophouse Union Sushi + Barbeque Bar Ed Debevic s Sushi Naniwa 6 Wildfire Restaurant 7 ZED HOTELS Aloft Chicago City Center Courtyard Chicago dana hotel and spa Fairfield Inn and Suites Homewood Suites 6 Holiday Inn Chicago - Mart Plaza 7 Hotel Palomar 8 Hyatt Place Chicago River North LAKE SHORE DRIVE 9

10 Contact Information HFF Chicago 8 West Madison Suite 900 Chicago, IL 6060 Telephone:.8.60 Fax:.8.6 Investment Contacts Jaime M. Fink Senior Managing Director.8.68 jfink@hfflp.com Jeffrey M. Bramson Senior Managing Director jbramson@hfflp.com Mark B. Katz Managing Director mkatz@hfflp.com Patrick Shields Analyst.8.68 pshields@hfflp.com Financing Contact Trent R. Niederberger Associate Director.8.68 tniederberger@hfflp.com Atlanta Austin Boston Chicago Denver Dallas Florham Park (NJ) Hartford Houston Indianapolis Los Angeles Miami New York Orange County (CA) Orlando Philadelphia Pittsburgh Portland (OR) San Diego San Francisco Tampa Washington, DC 0 HFF (Holliday Fenoglio Fowler, L.P.) and HFFS (HFF Securities L.P.) are owned by HFF, Inc. (NYSE: HF). HFF operates out of offices nationwide and is a leading provider of commercial real estate and capital markets services to the U.S. commercial real estate industry. HFF together with its affiliate HFFS offer clients a fully integrated national capital markets platform including debt placement, investment sales, equity placement, advisory services, loan sales and commercial loan servicing. For more information please visit hfflp.com or follow HFF on Twitter at twitter.com/hff. HFF has been engaged by the owner of the property to market it for sale. Information concerning the property described herein has been obtained from sources other than HFF and we make no representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all references to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a buyer. Buyers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change.