Sparling Technology Center

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1 INVESTMENT OFFERING Sparling Technology Center A 69,798 SF, Class A Office Building in Lynnwood, WA

2 Executive Summary THE OFFERING Kidder Mathews has been retained to exclusively market for sale Sparling Technology Center. The 69,798 square foot Class A office building is 94.5% leased to a well-diversified list of tenants including the anchor tenant, Stantec (NYSE: STN - $2.3 billion market cap). Stantec, occupying 42% of the rentable area, has been a tenant since the completion of the building in 2000 and recently extended their lease through August, Coldwell Banker Bain, occupying 7.5% of the building, serves as another anchor tenant originally pre-leasing space in 2001, and recently extending their lease. The five story concrete and steel building with structured parking is located in the heart of the Lynnwood CBD and within walking distance of the 1.3 million square foot Alderwood Mall, several restaurants, and retail amenities. The property is also conveniently located near both I-5 and I-405 as well as within blocks of the Lynnwood Sound Transit light rail station due to open in Greater Seattle continues to outpace all West Coast markets with over 75,000 new jobs added during 2016 with most economists predicting increases of 3-5%, or 50,000 to 80,000 new jobs in The Urban Land Institute (ULI) ranks Seattle in the top five markets for investment for MARKETING PROCESS The owner will consider offers as presented, but reserves the right to set a deadline for a definitive date. PROPERTY OVERVIEW PROPERTY TYPE ADDRESS BUILDING SIZE Sparling Technology Center Multi-Tenant Office Building th Street SW Lynnwood, WA ,798 SF OCCUPANCY 94.48% YEAR BUILT 2000 STORIES PARKING LAND AREA Five (5) Stories 3.25/1,000 SF (227 total stalls; 89 surface stalls, 138 covered stalls) 58,806 SF/1.35 AC PARCEL NUMBER ZONING CURRENT ANNUALIZED NOI $1,191,751 CC-C City Center Core PRICE $16,500,000 CAP RATE 7.22% Kidder Mathews Offering Memorandum 2

3 INVESTMENT HIGHLIGHTS Class A High Image Office Building Sparling Technology Center is a best in class asset with above market finishes and unique architectural design. The five story building is concrete and steel construction with granite, slate, and glass curtain walls. Completed in 2000 the building has traditionally out-performed surrounding office projects in the Lynnwood market. Stabilized Occupancy/Strong Credit Anchor The building is currently 94.5% leased to a welldiversified tenant roster. Stantec (NYSE & TSX: STN) is the building s anchor tenant occupying 42.4% of the building in 29,596 square feet. Sparling, the project s name sake tenant since 2000, merged with Stantec in The company has a $2.93 billion dollar market cap, employs approximately 22,000 people in over 400 locations across six continents, and provides professional services in the area of infrastructure and facilities for clients in the public and private sectors. Preferred Northend Location Sparling Technology Center offers tenants a convenient location in South Snohomish County that is less than a 30 minute drive to both downtown Seattle and Bellevue and a 40 minute drive to SeaTac International Airport. In addition, the building is located less than a block away from the Lynnwood Convention Center and is located within close proximity to numerous retail amenities including the 1.3 million square foot Alderwood Mall. Additionally, the property is within blocks of the Sound Transit light rail station that will provide connection south to Seattle upon targeted completion in Kidder Mathews Offering Memorandum 3

4 Strengthening Northend Office Market In the past 12 months, asking rental rates have increased approximately 7.0% for all comparable, Class A buildings located in the Sparling Technology Center Class A competitive set, with vacancy rates decreasing approximately 8.0% in the same period of time. With no new construction currently planned, this is a trend that should continue into 2017 and beyond. Priced Well Below Replacement Cost At $16,500,000 the price equates to $236/sf which is approximately 35% to 40% below estimated replacement cost of $350 to $375 per square foot. Kidder Mathews Offering Memorandum 4

5 Andy Miller Todd Battison Matthew Hagen, SIOR kiddermathews.com Kidder Mathews Offering Memorandum 5