PRESENTED BY THE ARA SALT LAKE TEAM. MARK JENSEN Exectutive Vice President of Investments. GREG RATLIFF Vice President of Investments

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1 PRESENTED BY THE ARA SALT LAKE TEAM MARK JENSEN Exectutive Vice President of Investments GREG RATLIFF Vice President of Investments CHRIS TURNER Investment Analysis/ Associate JARED WHIPPLE Transaction Manager

2 TABLE OF CONTENTS THANK YOU 3 OVERVIEW 5 THE STATE OF THE MULTIHOUSING MARKET: UTAH 7 RENT COMPARABLES 12 PIPELINE REPORTS 21 OPERATING EXPENSES 29 THE AMENITIES ARMS RACE SIGNIFICANT TRANSACTIONS 40 MULTIHOUSING TRENDS 42 CONCLUSION 47 2

3 THANK YOU

4 THANK YOU 2016 was another fantastic year for Utah Commercial Real Estate, and our team here at ARA SLC is very grateful for the relationships we have and the value we have been able to bring to the market. Did you know that Utah added over 39,800 jobs in 2016? Combine that with 3.1 % job growth and a cost of doing business that is 5.3% below the national average, and Utah has continued to stand out, particularly in the multihousing investment-world. We took advantage of the rising tide by advising and assisting clients in buying and selling. It was a record year for us most notably, we closed the largest Utah multihousing portfolio sale ever! The portfolio was comprised of 17 properties and 381 units. In addition, we handled the sale of Mission Meadowbrook Apartments, a 412-unit property in Salt Lake City the largest single sale for our team. The more we provide value to the marketplace, the more our team and our clients are rewarded, and we are just getting started! We are committed to continuing the momentum and we are committed to raising the bar. We hope that this State of the Market report showcases that commitment. We want to help you make your best year yet! THANK YOU FOR YOUR BUSINESS! 4

5 OVERVIEW

6 OVERVIEW Our vision for ARA SLC has always included becoming the market s best source for data. Our clients are surprised to learn that we collect the data ourselves. Time consuming, yes, but it is has become a very important part of advising clients and making decisions on what we work on and why. We have pitched ourselves as being stock brokers of physical assets, always looking for trends and opportunities (and holes in the market) for our clients to capitalize on. Collecting the data puts us on the front lines of being able to analyze the data regarding what it means to us and our clients (and THAT has quickly become our competitive advantage), but more importantly it gives our clients a jump on the market! We are committed to raising the bar and improving our craft. In this report, look for: 1. Rent Comp Surveys by submarket 2. Occupancy by submarket and property year built 3. Pipeline Reports by county and submarket we have also drilled down into the hot spots 4. OPEX we surveyed over 22,500 units 5. Important 2016 Sales 6. Construction Costs 7. The Amenities Arms Race and what that means to the market 8. RENOVATION! Information on the success of rehabbing and repositioning assets. 9. Trends to capitalize on in! RECENT SIGNIFICANT ARA TRANSACTIONS MISSION MEADOWBROOK 412-unit multihousing community acres in Salt Lake City 1985 construction CAROL JO APARTMENTS 17 units in Downtown SLC Location, location, location! 1952 & 1962 construction SEVEN C S MOBILE HOME PARK 74 pads in American Fork acres 1972 construction DIAMOND J PORTFOLIO 17 multifamily properties Located throughout Ogden & SLC GREEN PINES APARTMENTS 16 units in Sugar House 8,400 total rentable SF 1962 construction MADISON APARTMENTS 26 units in South Ogden 21,360 total rentable SF 1968 construction HIGHLIGHTED AVAILABLE INVESTMENTS MURRAY HEIGHTS & HILLSIDE PARK APARTMENTS 76 total units in Murray 69,713 total rentable SF 1968 & 1969 Construction PARK MANOR APARTMENTS 16 units in Salt Lake City Iconic Liberty Park community Excellent reposition opportunity MONTICELLO APARTMENTS 20 units in Ogden 12,300 total rentable SF 1969 construction THE ARCHES 21 units in Salt Lake City 8,980 total rentable SF 1973 construction 6

7 THE STATE OF THE MULTIHOUSING MARKET: UTAH

8 2016 MARKET SNAPSHOT STATE OF THE MARKET The Utah Commercial Real Estate Investment Market remains strong. Utah has solid market fundamentals being #1 in population growth and top 5 in job growth, which continue to make us desirable for capital preservation and long-term investors. Commercial real estate in general has become a safe harbor for investors, fueled by investors seeking yield away from low-return bank accounts and investors retreating from a volatile stock market environment, both in the U.S. and global markets. Investing in commercial real estate has become as much of an investment strategy to chase yield as it has become a strategy to not lose money. Recent volatility in the global markets has accented the flight to quality trend that really started revealing itself during the downturn in 2009, and Utah CRE is at the top of that list. At the VERY top is multihousing CRE investments in stable/growth markets like Salt Lake City! Utah multihousing checks all the important investment boxes for long-term growth and limited (on a comparative basis) downside. The easy money has been made since the downturn as appreciation of real estate held assets has exceeded expectations. The meteoric rise has some concerned headed into as headwinds do exist. Those headwinds include rising interest rates, knowledge of the length of this cycle compared to past cycles, and appreciation of rents vs. lack of rising incomes. Market Insight: Many renters are spending 40% to 50% of their income on rent. Average rental rates have climbed 17% in the past 10 years (adjusted for inflation), while median incomes have only grown 3%. CAP RATES Cap Rates are down overall in Industrial, Multihousing, Office, and Retail, which is a good sign of market strength. In Multihousing, we are seeing some price sensitivity in Class A product with the perception of limited upside opportunity in rental growth. Cap rates have decreased in all asset classes, being led by some very low cap rates in Class A quality deals. As we move forward, we will see continued strength in Class A and compressed cap rates in B & C assets as investors continue to look for value-add opportunities and chase yield over the Class A opportunities. Market Insight: Look at CAP rate compression in 1970s product! This is an indication of the interest in value-add projects. We are seeing a lot of success in renovation. Market Insight: Look at CAP rates for Class A apartments built since 2010! Investors are willing to pay up for well-located newer properties! VOLUME Volume is probably the first indicator we look at to determine where we are in the market, and volume through the end of 2016 is down. While sales volume was not too far off from 2015 ($703,240,222 in 2015 vs. $644,038,988 in 2016), the number of transactions was down 20%. While volume may be down for market conditions, we know there has been a limited supply to the massive amounts of demand we are still experiencing. We have noticed price sensitivity with the feeling that rental rates may be tapering, showing signs of weakness in pricing moving forward. We are anticipating slowing volume but demand remaining high through the end of Q2. Market Insight: Volume will be down for normal yield driven transactions as rising interest rates have increased the cost of capital, reducing positive leverage. However, 2016 data showed us a trend we were already seeing: demand moving either towards Class A bonds with limited upside but also limited downside, OR towards paying more for value-add strategies. With the latter strategy, investors are willing to take lower returns in the shortterm for medium- to long-term upside. PRICING Pricing is up! On a per-square-foot basis, pricing is up 18.4% in all asset classes combined since the downturn, being led by multihousing being up over 60% (if you look at Price PSF in 2010 vs. 2016). These figures are skewed because of newer product coming online and selling for higher prices, but overall it is interesting to note that office is trading at, or similar to, pricing in 2007, and industrial remains almost unchanged, going from $72.07 in 2007 to $63.57 in 2016, but multihousing is way up. Comparing 2016 to 2015 on a per-square-foot basis shows that multihousing is up 8.89%. Market Insight: Price PSF & Price Per Unit are up noticeably, but driven primarily by newer Class A deals that have been built since 2010 and sold in

9 THE STATE OF THE MULTIHOUSING MARKET: UTAH The Utah multifamily housing market continues to be robust. Since 2010, we have seen a continuous rise in both sales volume and values. For example, Multifamily Sales Volume in 2015 was up 330% compared to Property Values, as you will see below in our proprietary snapshot Annualized Nominal Return Analysis, have seen an 8.6% annual increase since 2009! The market is changing and we saw many of those changes start to manifest themselves in We are asked daily Where do you think we are in the cycle? and Are we overbuilt? In this report we want to update you on state of the multifamily market and then we will work to answer those all important questions! We will review sale comps, rent trends, construction pipeline & absorption information, OPEX, trends in the market place, and overall information nuggets (because we re obsessed with data) that we hope add value to your world. VOLUME AND PRICING Transaction volume is a key indicator we look at to determine where we are in the market, and volume in 2016 was down. In 2015, Utah experienced the largest transaction volume year that we have seen in multi-family investments there were 55 transactions totaling $703,240,988 and 3,451 units traded. In 2016, we saw 41 transactions totaling $644,038,988. A lack of available product, legacy debt needing to be assumed, and increased pricing expectations have lowered 2016 volume versus 2015, albeit by not much was a HUGE year for dollar volume, and though we were slighty down in 2016, we can see a steady increase of price per square foot that we have seen trending since 2012; we have seen a 13.5% increase YOY for the last 2 years, putting us at $ PSF YTD in While volume has been down, that is not a representation of where we are in the market, because demand is still very strong. Less has truly meant more for our clients as demand far outweighs supply, and buyers are willing to pay more for long-term upside and capital preservation in the Utah market. In marketing the 412-unit Mission Meadowbrook Apartments this year, as an example, our team received 91 executed Confidentiality Agreements (buyers interested in the Utah Market), conducted 22 tours, and received 12 offers all for 1 property. TOTAL DOLLAR VOLUME IN MILLIONS $800 $700 $600 $500 $400 $300 $200 $374,164, $191,400,600 $167,300,775 $ $219,023, $313,429, $602,616,132 $252,643,900 $703,240,222 $644,038,988 9

10 THE STATE OF THE MULTIHOUSING MARKET: UTAH CONTINUED NUMBER OF INVESTMENTS Market Insight: Transaction volume was down 20% despite dollar volume only being down 8%, a sign of larger deals getting done. $150 AVERAGE PRICE PER SQUARE FOOT $ $120 $90 $ $92.29 $81.21 $92.52 $ $ $ $86.98 $ Market Insight: Market Insight: Pricing on a PSF basis was up 8.9% a strong reflection of the uplift in pricing as a result of demand and the types of properties (specifically Class A) that were traded. Pricing on a per unit basis was also up nearly 9% over 2015 numbers as well. 10

11 THE STATE OF THE MULTIHOUSING MARKET: UTAH CONTINUED CAP RATES & TRANSACTIONS BY YEAR BUILT The graph below is by far our favorite visualization of the data showcasing what we are seeing in the market today. In 2012, we saw the most deals completed in the last 5 years, with the vast majority of deals being B & C assets. As we moved into 2013, we saw some of the recently constructed projects (value had been added!) spin off and sell, peaking in We are seeing more pricing sensitivity in the A product as the expectation of rental increases in the Class A space has gone down and buyers are moving into the value-add B & C assets again in a big way. Market Insight: Roughly 70% of the transactions in 2016 were completed with properties older than TRANSACTIONS BY YEAR BUILT Market Insight: Cap rates have been in continuous decline since The most notable decline is in product built between 1970 and 1979 where we saw compression from 9.20% to 5.31%. That same strata is leading in today s market as buyer s chase yield in value-add opportunities vs. stagnant Class A rent growth and no value-add component (Thru ) Pre Current Current Pre 1970 AVERAGE CAP RATES BY YEAR BUILT Market Insight: Cap rates compressed 67 basis points in 2016 on deals built since 2010, showing the demand side pressure for institutional product. 11

12 RENT COMPARABLES

13 RENT COMPARABLES Rents continued to increase along the Wasatch Front and vacancies continued to decline. Salt Lake County overall has dipped below 3% vacancy. We are tracking rents and the development pipeline VERY closely; as we noted we are asked daily if we are overbuilding. While we can statistically show you that supply is still ahead of demand, we do feel that there are 3 submarkets that have the potential to endure short term pockets of lease-up and rental rate heartache: Downtown, Sugar House, and Sandy. Let us start with rent data. The average rents in the submarkets that we track went from an average of $1,248 per unit in Q to $1,337 in Q4 2016, showing an annual increase of 6.66%, being led by 2-bedroom units. The biggest increase in year-over-year rents that we saw in our Sandy/Midvale rent comp survey was in 2-bedroom 1-bath units at 15.1%. The lowest YOY increase we saw was in our Sugar House Class A survey, where 2-bedroom 2-bath rents actually declined 4.57%. Our rental comp surveys prove time and time again to be an irreplaceable asset in our ability to show opportunity to the market, and we knew we had to take it a step further. Mark Jensen RENT GROWTH - YEAR OVER YEAR Q Q Q Q RENT GROWTH BY UNIT MIX I PER UNIT RENT GROWTH BY UNIT MIX PER UNIT Q Q Q Q Q % 5.57% 4.69% 7.30% 7.36% 9.48% 10.02% 9.16% 7.73% 7.10% STUDIO 1 BED 2 BED 3 BED OVERALL RENT GROWTH BY UNIT MIX I PSF Q Q Q Q Q $0.90 $0.93 $0.97 $1.04 $1.07 $1.40 $1.50 $1.55 $1.60 $1.69 $1.28 $1.37 $1.45 $1.51 $1.53 $1.36 $1.44 $1.49 $1.56 $1.62 $1.88 $1.95 $1.98 $2.11 $2.20 $894 $932 $944 $976 $1,018 $1,051 $1,101 $1,136 $1,166 $1,227 $1,218 $1,293 $1,372 $1,428 $1,440 $1,148 $1,210 $1,261 $1,345 $1,389 $1,077 $1,134 $1,178 $1,229 $1,268 STUDIO 1 BED 2 BED 3 BED OVERALL STUDIO 1 BED 2 BED 3 BED OVERALL 13

14 MULTIHOUSING KICKOFF REPORT RENT COMPARABLE SURVEY DETAILS Just as in any other business, what drives values most is topline revenue in our case, rents. For our team, nothing is more valuable than understanding exactly what rents are and where they are going. The following are four submarkets that provide a diverse look into how the general Salt Lake Market in every class is performing. This isn t everything we track, of course; as market leaders we have optics into many more markets across the Wasatch Front for our clients to understand where their rents are and where they could be to, and ensure they either maximize their value, or maximize their value upon selling. Above all, we aim to have more and better data than anyone in the market to best determine where we can add value to our clients East 400 South, Suite 120 l Salt Lake City, Utah l l

15 RENT COMPARABLES STUDY - DOWNTOWN - CLASS A RENT GROWTH YOY PER UNIT RENT GROWTH - YEAR OVER YEAR Q Q Q Q Q Q Q Q Q PRICE PER UNIT $938 $988 $1,010 $1,022 $1,154 $1,291 $1,298 $1,305 $1,335 $1,389 $1,415 $1,480 $1,546 $1,570 $1,600 $1,533 $1,605 $1,739 $1,745 $1,867 $1,294 $1,342 $1,400 $1,418 $1,503 PERCENT CHANGE 3.41% 12.48% 2.83% 6.03% 5.73% 3.37% 8.05% 6.84% 5.01% 7.18% STUDIO 1X1 2X1 2X2 OVERALL STUDIO 1X1 2X1 2X2 OVERALL RENT GROWTH YOY PER SF Q Q Q Q Q $1.74 $1.81 $1.84 $2.01 $1.59 $1.81 $1.80 $2.26 $1.84 $1.98 $1.67 $1.77 $1.85 $1.88 $1.89 $1.49 $1.61 $1.73 $1.75 $1.85 $1.62 $1.75 $1.81 $1.87 $2.00 Downtown rents continue to rise as we have yet to see the current pipeline supply hit the market and put downward pressure on Class-A rents. Overall rent growth has increased to 7.1% Year over Year. STUDIO 1X1 2X1 2X2 OVERALL 15

16 RENT COMPARABLES STUDY - SUGAR HOUSE - CLASS A RENT GROWTH YOY PER UNIT RENT GROWTH - YEAR OVER YEAR Q Q Q Q Q Q Q Q Q PRICE PER UNIT $1,115 $1,165 $1,140 $1,178 $1,135 $1,392 $1,469 $1,537 $1,555 $1,615 $1,576 $1,797 $1,958 $2,053 $1,965 $1,361 $1,477 $1,545 $1,595 $1,572 STUDIO 1X1 2X2 OVERALL RENT GROWTH YOY PER SF $2.21 $2.31 $2.27 $2.37 $2.30 $1.63 $1.71 $1.80 $1.83 $1.91 $ % 1.30% $ % 5.76% 12.50% 7.20% -4.57% PERCENT CHANGE 0.83% STUDIO 1X1 2X2 OVERALL Q Q Q Q Q $1.83 $1.92 $1.75 $1.77 $1.90 $1.97 $2.04 $1.99 Sugar House is seeing rent growth slow for the first time in this cycle, and even a decline in 2-bedroom units. While this may look alarming, fundamentals are still very strong and rents are still growing overall in a submarket that is 96% occupied. STUDIO 1X1 2X2 OVERALL 16

17 RENT COMPARABLES STUDY - REDWOOD ROAD CORRIDOR - CLASS B RENT GROWTH YOY PER UNIT REDWOOD ROAD CORRIDOR RENT GROWTH - YEAR OVER YEAR Q Q Q42015 Q Q Q Q Q Q PRICE PER UNIT $1.70 $1.74 $1.83 $1.95 $2.05 $1.17 $1.21 $1.26 $1.35 $1.38 $0.90 $0.94 $0.96 $1.04 $1.06 $0.84 $0.88 $0.97 $0.99 $1.11 $0.83 $0.85 $0.89 $0.93 $0.96 $1.09 $1.12 $1.18 $1.25 $1.31 PERCENT CHANGE 11.66% 10.97% 10.64% 8.88% 9.74% 9.32% 11.37% 12.63% 8.11% 5.94% 10.30% 9.55% STUDIO 1X1 2X1 2X2 3X2 OVERALL STUDIO 1X1 2X1 2X2 3X2 OVERALL RENT GROWTH YOY PER SF $628 $644 $682 $729 $766 $679 $739 $770 $827 $845 Q Q Q42015 Q Q $822 $862 $885 $955 $976 $862 $912 $1,003 $1,029 $1,148 $1,088 $1,167 $1,219 $1,270 $1,296 $816 $865 $912 $962 $1,006 The Redwood Road corridor has been a rehab value-add story. Most of the rent growth has occurred as institutional investors and property management have seen upside in renovation and maintained occupancy above 95%. Rent growth continues to be high above average through renovations, but will likely cool off as the renovation pipeline fills up. Also worth noting is the affordability component; unlike Downtown, rents are 40% less than core Class A properties of the same unit configuration. STUDIO 1X1 2X1 2X2 3X2 OVERALL 17

18 RENT COMPARABLES STUDY - SANDY/MIDVALE - CLASS B RENT GROWTH YOY PER UNIT Q Q Q Q Q RENT GROWTH - YEAR OVER YEAR Q Q Q Q PRICE PER UNIT $840 $898 $933 $952 $1,057 $936 $977 $1,029 $1,114 $1,212 $1,047 $1,111 $1,142 $1,211 $1,310 $1,208 $1,253 $1,304 $1,420 $1,481 $1,008 $1,060 $1,102 $1,174 $1,265 PERCENT CHANGE 5.65% 11.73% 12.30% 15.10% 8.26% 12.82% 11.74% 11.97% 9.48% 12.91% 1X1 2X1 2X2 3X2 OVERALL 1X1 2X1 2X2 3X2 OVERALL RENT GROWTH YOY PER SF Q Q Q Q Q $1.19 $1.27 $1.33 $1.36 $1.50 $1.04 $1.09 $1.15 $1.24 $1.35 $1.04 $1.10 $1.12 $1.19 $1.33 $0.96 $1.00 $1.04 $1.14 $1.17 $1.06 $1.12 $1.16 $1.23 $1.34 The Mid Valley has performed well over the past 12 months and has seen healthy overall rental increases as a result of strong job and population growth. Much like Downtown, rent growth will likely taper throughout as historic supply hits the market. 1X1 2X1 2X2 3X2 OVERALL 18

19 SALE PRICES CAP RATE COMPRESSION - PROPERTIES PURCHASED BETWEEN Cap Rate Compression Properties Purchased Between % 11.42% 10.00% 8.00% 6.00% 9.12% 6.47% 7.52% 5.00% 8.42% 7.30% 9.37% 8.01% 6.29% 5.81% 5.80% 7.50% 6.50% 7.90% 6.00% 6.64% 6.51% 4.00% 2.00% 0.00% 139 East 400 North Emigration Court Apartments Riverview Townhomes 1865 Independence Townhomes 765 Lofts Legends at River Oaks Apartments Jordan Village Apartments 8 Unit South 400 East Edison Street Condominiums Purchase CAP Sold CAP The goal was to take a vertical look at just how well the commercial real estate market (specifically multifamily) is performing to get a true value in the market place by looking at every deal that has retraded since What do we mean by retraded? To retrade is to cycle a property, whereby the property was purchased within a certain time period (in this case & ) and that same property was then sold (at some point after). This type of analysis is arguably more accurate and representative of the market, much like seeing the same stock trade multiple times on the open market. Averaging the market performance is helpful, but nothing is more accurate than seeing the same asset trade to get a clear image of the market. If nothing else, this graph should tell you that now is the time to consider selling your property! 19

20 HISTORICAL SALES ANALYSIS Properties that had a value-add component (where buyers were buying and adding value through improvements, remodeling, etc.) saw the highest return on investment. Below is an analysis of 5 deals that traded two or more times and their annualized return based on Price Per Square Foot. These are entry and exit points and our analysis does not account for the amount of equity invested in the projects, but it illustrates one of the biggest trends we are seeing in the market: now is the time to improve properties % 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% ANNUALIZED NOMINAL RETURN (PSF) 0.00% 139 East 400 North 323 South 500 East 1665 South Riverside Dr 1492 Spring Lane 1865 West Independence BLVD 139 East 400 North Emigration Court Apartments Riverview Townhomes Sandpiper Apartments 1865 Independence Townhomes Similar to the cap rate analysis we performed on re-traded or block-chain deals, this graph displays many of those same properties and more to give an idea of where pricing has moved over the past five years. As you can see, many of these assets have appreciated in gross value some by 50% to more than double all of which has occurred since PRICE PER SQUARE FOOT $ $ $ $ $50.00 $- Older PSF PSF Newer 20

21 PIPELINE REPORTS

22 CURRENT DEVELOPMENT PIPELINES PIPELINE Last year was truly a year of unprecedented development. In continuation of what started in 2014 and exploded in 2015, apartment development catapulted in There are over 7,009 units currently under construction in Salt Lake County, with an additional 7,052 units likely to start between now and that is a total of over 14,061 units built in 2016, currently under construction, and planned for. To put this in perspective, we added 8,000 units in 37 projects between 2010 and end of 2014 about 1,600 units/year. There are several development hot spots to watch closely. These areas are seeing, and will continue to see, the most deliveries: Downtown, Sugar House, Sandy/South Valley, and North Utah County. Sandy represents about 20% of the apartment market currently under construction, and the Sugar House S-Line has over 1,300 units currently under construction or proposed. Downtown has seen the largest amount of construction and will continue to see a large percentage of deliveries. Salt Lake City represents over 40 percent of the current and planned projects, with the vast majority of those projects in Sugar House/S-Line and Downtown. North Utah County has 1,180 units currently under construction, with over 2,038 additional units slated for. While we anticipate vacancy rates rising and rental rates continuing to taper, we see this as a short-term slowdown, as the and 2018 pipelines will wane with construction costs rising, limited quality infill locations, and increasing costs of capital. ABSORPTION: HOW HEALTHY IS THE MARKET Another metric we have been tracking is the absorption rate of new units that are coming online. This has been a key indicator of the strength of the market and has also given us great insights into where we are headed. Recently we tracked nine significant Class-A multihousing lease-ups with a total of 1,395 apartments leased to current occupancy. Overall the average leases rented per month approximated 23 in these following submarkets. The highest velocity was Sugar House with 40 units/month and the lowest was 13.5 units. Our data has indicated that lease-up has slowed as pricing has become more expensive. Most recently in 2016, the deals we have been tracking have slowed to 20 units/month. SALT LAKE CITY-DOWNTOWN There were three Class-A properties in lease-up in 2015 which generated an average of 22 leases per month. Currently each of these properties are averaging 95.5% occupancy. SUGAR HOUSE Two communities leased up in Sugar House in 2015 with disparate results. One was a Class-A community which generated 20 leases/month while another community with a mixed-income component averaged 40 leases per month. Currently the properties are averaging 95% occupancy. SOUTH JORDAN Two communities totaling 303 units leased up in this submarket averaging 20.5 leases per month with combined current occupancies averaging 94%. SANDY One community averaged 22 leases per month and is nearing completion at 93% occupancy. HERRIMAN One community leased approximately 13.5 leases per month between November 2014 and September 2015 and is currently 92% occupied TO DATE We are presently tracking six lease-ups at Class A properties in Salt Lake City-Downtown, Sugar House, Salt Lake County, and South Jordan - an approximate total of 927 units leased at an average of 20 leases per month per property. 22

23 CURRENT DEVELOPMENT PIPELINES All Salt Lake County submarkets are experiencing record development with a total of 6,621 units under construction at 32 locations of which the most notable submarkets are: Salt Lake City-Downtown: Downtown leads all submarkets as there currently is a total of 2,290 units under construction of which 79% are Class-A communities. In addition, there were approximately 804 units projected to commence construction in late Sandy: Approximately 1,756 units presently under construction of which approximately 75% are considered Class-A communities. TRAX S-Line Corridor: The completion of the East-West TRAX S-line commencing in Sugar House has piqued the interest of several developers to acquire infill locations between Sugar House and Main Street in Salt Lake City. Presently there are two Class-A projects under construction totaling 324 units; however, between Q and Q3 there are potentially another 998 units at 7 projects. POTENTIAL STARTS IN OR LATER IN SALT LAKE COUNTY Currently there are 5,331 units potentially slated to begin construction in Salt Lake County. Over 2,500 of these units will be within Salt Lake City, while the rest are to be developed in South Valley notably, Draper and Sandy have another 1,078 units potentially coming on board as well. 23

24 HISTORICAL MULTIHOUSING DEVELOPMENT PIPELINES Between 2000 and 2004, there were approximately 12 multihousing projects ranging between units constructed in Salt Lake County, adding approximately 3,200 units to the inventory. Between 2005 and 2009, we saw an additional 2,340 units added at 12 multihousing projects in Salt Lake County. Then the multihousing development tidal wave began. Between 2010 and 2014, there were projects completed which added approximately 8,000 units to the Salt Lake County multihousing inventory, with notable development growth in the following submarkets: Salt Lake City-Downtown 1,204 units Midvale 1,109 units South Jordan 1,075 units Murray 965 units West Valley City 819 units In our opinion, it comes as no surprise that Salt Lake City-Downtown experienced the greatest multihousing development during the period when the $1.5 billion City Creek Center was being completed, as part of an estimated $5 billion sustainable design project to revitalize Downtown Salt Lake City. While City Creek Center was in the planning stages, the attendant office development at 222 South Main Street absorbed a total of seven floors occupied by Goldman Sachs, becoming their fourth-largest office in the world. The Goldman Sachs office, as well as other high-profile tenants such as Holland & Hart, Phillips/Edison, Workday, and Fidelity Investment, brought many well-paying jobs to Downtown Salt Lake City, leaving few downtown apartment rental choices for their employees. As mentioned in The Amenities Arms Race section of our report, the most popular community amenity is the neighborhood. We have experienced the evolution of a neighborhood such as Sugar House, which is amenity-laden with shopping, restaurants, recreation, and high walkability scores most popular with millennials seeking lifestyle conveniences. This has created a multihousing boom, adding over 700 units from As this neighborhood continues to evolve, it is exploding again with another 927 units set for development along the TRAX S-Line beginning at McClelland Avenue and State Street, as well as the 2100 South corridor. We analyzed the data back to 2000 to see how development growth has affected four major hotspots in Utah: Downtown Salt Lake City, Sugar House, Sandy/South Valley, and North Utah County. Watch the progression... 24

25 HISTORIC MULTIHOUSING UNITS DOWNTOWN SALT LAKE CITY MULTIFAMILY Downtown 16 25

26 MULTIHOUSING KICKOFF REPORT HISTORIC MULTIHOUSING UNITS SUGARHOUSE East 400 South, Suite 120 l Salt Lake City, Utah l l

27 MULTIHOUSING KICKOFF REPORT HISTORIC MULTIHOUSING UNITS SOUTH VALLEY MULTIFAMILY South-Valley East 400 South, Suite 120 l Salt Lake City, Utah l l

28 MULTIHOUSING KICKOFF REPORT HISTORIC MULTIHOUSING UNITS UTAH VALLEY East 400 South, Suite 120 l Salt Lake City, Utah l l

29 OPERATING EXPENSES

30 COMPILED OPEX 2016 Being in the trenches daily gives us, as brokers, access to some of the problems our clients face in the acquisition/disposition process. One of the challenges we have seen in assets we have worked on comes when the operating expenses show higher than what we would consider market. This could be that improvements were not capitalized through renovation, or internal issues resulted in poor management. Unfortunately, not everyone wants to believe a broker when they tell them that expenses will be less when you own the property. Because of the volume of transactions we are involved in, we are uniquely positioned to have optics into the operations of properties small to large and old to new, and we are able to use that data to shore up our underwriting with buyers/sellers and lenders. This allows us to successfully take on properties that have poor books and records, self-managed assets, assets in trouble, or generally connect the dots with buyers unfamiliar with our market. We decided to expand our internal OPEX database and are grateful to our owners and third-party management partners for providing us the data that ultimately offered us optics into over 17,500 units along the Wasatch Front. SALT LAKE COUNTY UTAH COUNTY SALARIES SALARIES $681 ADMIN ADMIN $200 $1,189 MARKETING R&M CONTRACT SERVICES $832 $1,180 MARKETING R&M CONTRACT SERVICES TURNOVER $247 TURNOVER $801 $359 $167 $270 $168 $151 $261 MGMT FEES PROPERTY TAXES INSURANCE UTILITIES RESERVES $565 $349 $135 $207 $241 $161 $161 MGMT FEES PROPERTY TAXES INSURANCE UTILITIES TOTAL: $4,201 TOTAL: $4,077 WEBER COUNTY DAVIS COUNTY SALARIES SALARIES ADMIN ADMIN $966 MARKETING $848 MARKETING $1,313 R&M $1,167 R&M $223 CONTRACT SERVICES TURNOVER $131 CONTRACT SERVICES TURNOVER $443 $322 $149 $241 $177 $171 $196 MGMT FEES PROPERTY TAXES INSURANCE UTILITIES $641 $330 $141 $247 $180 $165 $171 MGMT FEES PROPERTY TAXES INSURANCE UTILITIES TOTAL: $4,248 TOTAL: $4,022 30

31 SALT LAKE COUNTY OPERATING EXPENSES 2016 EXPENSES EXPENSES $1, $1, $1, $ $ $ $ $- $1, $1, $1, $1, $ $ $ $ $- Salaries Admin Marketing R&M Salaries Admin Marketing R&M 2016 OP EX BY CLASS Contract Services 2016 OP EX BY YEAR BUILT Contract Services Turnover Turnover MGMT Fees MGMT Fees Property Taxes Property Taxes Insurance Class A $1,212 $336 $199 $272 $204 $141 $495 $1,235 $180 $862 Class B $1,135 $133 $142 $257 $276 $173 $315 $751 $202 $600 Class C $1,393 $151 $120 $301 $342 $208 $399 $658 $205 $597 Insurance <1970 $1,271 $161 $129 $385 $337 $188 $383 $654 $272 $ $1,157 $134 $135 $306 $315 $192 $362 $708 $211 $ $1,170 $118 $128 $189 $278 $162 $292 $736 $178 $ $1,275 $131 $157 $181 $268 $183 $313 $850 $117 $ $1,190 $220 $186 $208 $185 $155 $330 $951 $217 $ Current $1,216 $354 $199 $271 $215 $142 $518 $1,241 $186 $894 Utilities Utilities $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- TOTAL OPEX BY CLASS Class A Class B Class C $5,139 $3,984 $4,375 TOTAL OPEX BY YEAR BUILT < s 1980 s 1990 s 2000 s 2010 s $4,507 $4,156 $3,755 $4,122 $4,262 $5,236 31

32 UTAH COUNTY OPERATING EXPENSES 2016 $1,400 OPEX BY CLASS TOTAL OPEX BY CLASS $1,200 $1,000 $800 $600 $400 $200 $- Salaries Admin Marketing R&M Contract Services Turnover MGMT Fee Property Taxes Insurance Class A $1,086 $280 $185 $139 $193 $132 $365 $679 $446 $947 Class B $1,238 $181 $145 $166 $242 $128 $342 $426 $187 $784 Utilities $5,000 $4,500 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $- Class A Class B Total Opex $4,516 $3,839 OPEX BY YEAR BUILT $1,400 $1,200 $1,000 $800 $600 $400 $200 $- Salaries Admin Marketing R&M Contract Services Turnover MGMT Fee Property Taxes Insurance Utilities $1,236 $182 $131 $110 $251 $95 $348 $397 $199 $ $1,315 $174 $155 $292 $256 $191 $306 $581 $106 $ $1,082 $287 $132 $141 $186 $121 $383 $691 $425 $1, Current $1,141 $289 $215 $180 $159 $145 $341 $679 $471 $836 $5,000 $4,000 $3,000 $2,000 $1,000 TOTAL OPEX BY YEAR BUILT $- 1970's 1990's 2000's 2010's TOTAL $3,765 $3,982 $4,643 $4,456 32

33 DAVIS COUNTY OPERATING EXPENSES 2016 $1,400 OPEX BY CLASS TOTAL OPEX BY CLASS $1,200 $1,000 $800 $600 $400 $200 $- Salaries Admin Marketing R&M Contract Services Turnover MGMT Fees Property Taxes Insurance Class A $1,146 $200 $236 $231 $210 $176 $403 $1,092 $148 $989 Class B $1,176 $133 $156 $158 $255 $137 $304 $554 $128 $769 Utilities $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- Class A Class B Total Opex $4,830 $3,770 $1,400 $1,200 $1,000 $800 $600 $400 $200 $- Salaries Admin Marketing R&M OPEX BY YEAR BUILT Contract Services Turnover MGMT Fees Property Taxes Insurance $1,166 $121 $162 $160 $234 $126 $275 $461 $133 $ $1,180 $140 $153 $152 $260 $149 $316 $592 $121 $ Current $1,146 $200 $236 $231 $210 $176 $403 $1,092 $148 $989 Utilities TOTAL OPEX BY YEAR BUILT County $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- 1980's 1990's 2010's TOTAL $3,705 $3,753 $4,830 33

34 WEBER COUNTY OPERATING EXPENSES 2016 $1,600 $1,400 OPEX BY CLASS TOTAL OPEX BY CLASS $1,200 $1,000 $800 $600 $400 $200 $- Salaries Admin Marketing R&M Contract Services Turnover MGMT Fee Property taxes Insurance Utilities Class A $1,273 $271 $175 $165 $158 $141 $314 $504 $412 $916 Class B $1,245 $119 $109 $152 $313 $101 $319 $169 $162 $917 Class C $1,467 $142 $212 $272 $339 $246 $341 $496 $191 $1,287 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $- Salaries Admin Marketing R&M OPEX BY YEAR BUILT Contract Services Turnover MGMT Fee Property taxes Insurance Utilities $1,467 $142 $212 $272 $339 $246 $341 $496 $191 $1, $1,245 $119 $109 $152 $313 $101 $319 $169 $162 $ $1,377 $302 $137 $162 $168 $149 $314 $504 $412 $930 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- Class A Class B Class C Total Opex $4,329 $3,605 $4,993 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 TOTAL OPEX BY YEAR BUILT $- 1970's 1980's 2000's TOTAL $4,993 $3,605 $4,455 34

35 WASATCH FRONT OPERATING EXPENSES 2016 $4,300 TOTAL OPEX - WASATCH FRONT $4,250 Annual OPEX/Unit $4,200 $4,150 $4,100 $4,050 $4,000 $3,950 All numbers based on annual price per unit Analysis based on the mean value of the average and median results for each category, respectively. Survey based on 23,692 units across the Wasatch Front, including: 17,522 units in Salt Lake County 2,141 units in Utah County 2,388 units in Davis County 687 units in Weber County $3,900 Salt Lake County Utah County Davis County Weber County TOTAL OP-EX $4,248 $4,077 $4,022 $4,201 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 OPEX BY NUMBER OF UNITS - WASATCH FRONT SALARIES ADMIN MARKETING R&M CONTRACT SERVICES TURNOVER MGMT FEES PROPERTY TAXES INSURANCE 0-49 Units $1,055 $197 $108 $405 $315 $171 $424 $727 $261 $ Units $1,284 $190 $167 $210 $266 $156 $371 $734 $192 $ Units $1,155 $141 $171 $208 $212 $154 $351 $807 $130 $ Units $1,113 $144 $152 $183 $228 $161 $276 $771 $184 $690 UTILITIES $4,400 $4,300 $4,200 $4,100 $4,000 $3,900 $3,800 $3,700 $3,600 TOTAL OPEX - WASATCH FRONT 0-49 Units Units Units Units TOTAL $4,254 $4,363 $4,144 $3,901 35

36 THE AMENITIES ARMS RACE

37 THE AMENITIES ARMS RACE WHAT DO RENTERS WANT? (NMHC/Kingsley Associates Survey) Today s renters have raised expectations as the decision to rent is no longer made by necessity. It is a conscious choice to have the flexibility, convenience and amenities which renting provides. There are more choices than ever to rent from based on the success of internet marketing and unprecedented construction in every major market and submarket. Due to affordability issues in urban locations, the national trend is moving toward shrinking apartment units (over the previous five years, apartment living-spaces have reduced between 8-10% in size), which has resulted in expanded common areas and community spaces. This meets the desire of the residents to gather socially and also serves as ad hoc living spaces where they may recreate in resort-style fitness centers and pools, browse the internet in comfortable environments, and work remotely without having to commute to their offices. The quality of a property s amenities plays a huge role in the clientele and the rents it can generate, and the following are some of the latest amenities we are seeing on a national level. The multihousing industry is slowly moving toward giving the residents greater command over their living environments Controlled-access to the building, parking areas, and common spaces Cloud-connected devices which monitor lighting, heating and cooling, and entrance cameras Common spaces equipped with the technology to facilitate a live-work interaction USB ports everywhere Dependable, free WiFi icafes Comfortable, yet durable furniture, floor coverings, and work spaces Conference rooms with monitors and teleconferencing features 37

38 THE AMENITIES ARMS RACE Rooftop decks and terraces are now must-haves for mid-and high-rise buildings Comfy seating, sonic sound systems, big-screen TV s, kitchens with barbecue grills, pizza ovens, and even cabanas Fitness Centers are no longer just places to exercise they have doubled in size and have become a place where residents gather and socialize without the need to join a gym Yoga, aerobics, and wellness classes Cardio and strength training facilities Flat screen monitors and state of the art sound systems Infinity pools Resident lounges for pre- and post-work out social interaction Meeting the Bike and Dog Revolution Bike storage and repair stations Pet Amenities: Grooming stations, walking areas, and pet parks Package delivery management as a result of the explosion of on-line retailing Concierge services Dry Cleaning services Cooking Classes 38

39 THE AMENITIES ARMS RACE However, not to be overlooked are community amenities those which remain near the top of most renters lists are Location and Neighborhood Close to work Walkability-High walk scores Biggest community amenity is always the neighborhood Close to transportation, restaurants, shopping, and entertainment 39

40 2016 SIGNIFICANT TRANSACTIONS

41 2016 SIGNIFICANT DEALS Let s talk about some of the largest transactions that drove up the volume in 2016! Bridges at Citifront Illustrates a value-add strategy and long-term bullish attitude towards downtown. Also a value play to the newer product coming online. Eagle s Landing Represents the strength of affordable workforce housing as an insurance policy position with little to no downside. Mission Meadowbrook 412 units that our team handled. Illustrates a combination of the bond position of workforce housing in Utah with a value-add strategy for future growth. Encore Built in 2015 & sold in 2016 Illustrates that buyers are willing to pay big dollars to get into our market. Also illustrates the institutional investor appetite and belief in our market long-term. The Miller Portfolio 1,190 units, with more to come in. Internal forced sale, not necessarily representative of where we are in the market but HUGE numbers. 89 Salt Lake City International Airport Bridges at Citifront 295 Units February 2016 Eagle s Landing 378 Units June 2016 Sagegate Apartments 278 Units June 2016 Farmgate Apartments 496 Units May 2016 Magna South 8200 South New Bingham Highway!( West Valley City 5600 West!( Herriman 2100 South 4700 South Kearns West Jordan 9000 South S outh 3100 South 4800 West 4100 South 7800 South South Jordan 4000 West!( Salt Lake City Taylorsville 3200 West South 50 0 So uth 2700 West South Riverton Redw ood Road 1300 West South!( 300 West!(!( Sta te Stre et South Salt Lake Murray Midvale 700 West 5900 South South 700 East 900 East!( 1300 East Draper 1700 South 2700 South Hi ghlan d Millcreek Holladay Cottonwood Heights D Sandy rive Cre ek R o ad 215 E m i grati on Ca ny on R oad Encore Apartments 189 Units October 2016 Mission Meadowbrook 412 Units October 2016 Cobblegate Apartments 416 Units November

42 MULTIHOUSING TRENDS

43 MULTIHOUSING KICKOFF REPORT TRENDS IN THE MARKETPLACE We have discussed pricing, volume and the development pipeline, and alluded to serveral trends we d like to call out in this section. UNIT RENOVATIONS If you are not renovating your dated units, you should be! We have seen projects as old as the 1920s invest in $25,000 per unit in complete renovations and take average rents from $619 to $1,140 (yes, that is $531 on $25,000, which is a 25.48% return on additional equity invested!) to units that are doing lighter renovations of $5,000 and getting $85 to $150/month (which equates to 20.4% to 36% on additional equity invested). Renovating units attract a higher profile resident, but can also bring better quality tenants and improve the credit of the property, increasing value by lowering the CAP. Taking a C to a B, for example, during 2009 to 2016 could have seen as much as a 191 bps reduction in CAP rate. Below is a sample value-add component in our marketing package. Every submarket has a proven model we can piggy-back to capture future upside today for our clients. HIDDEN COVE APARTMENTS 2075 NORTH MAIN STREET I LAYTON I UTAH I VALUE ADD OPPORTUNITY RENOVATION OPPORTUNITY Significant renovation opportunity exists at Hidden Cove. Other competing properties of similar scope and scale within this submarket have been upgrading apartment floorplans and achieving robust rent increases. Goldstone Place Apartments Pinnacle Mountain View Apartments 1200 South 1500 East, Clearfield, UT 1100 S 2000 E, Clearfield, Utah 228 Units 1985 Construction 324 Units 1997 Construction Comparable to Hidden Cove UNIT UPGRADES ^ S out h " ) Ant elo pe D riv e Lay to n MMUNITY re et Pinnacle Mountain View Apartments " ) St! 2! No r th Goldstone Place Apartments n ^1 15 Hidden Cove Apartments ai Average approximate cost per unit: $5,000 Monthly rent escalations of $85$150/Unit M Average approximate cost per unit: $7,000 Monthly rent escalations of $152/ Unit 2!!1 et (! re Floor Covering Replacement Upgraded Plumbing and Lighting Fixtures New Kitchen Cabinets Full Replacements Refinished Laminate Counters Upgraded Appliance Package St e C l e ar f i e l d UNIT UPGRADES Faux Wood Vinyl Laminate Floorcoverings Upgraded Plumbing and Lighting Fixtures Cabinetry Repainting with New Handles/Pulls Refinished Counters All-Black Appliance Packages Washer/Dryer Retrofit 193 " ) at MPARABLES N St ANCIALS COMP #2 Hill Field Roa d PERTY COMP # W es t CUTIVE MMARY East 400 South, Suite 120 l Salt Lake City, Utah l l

44 TRENDS: VALUE ADD OPPORTUNITES & RENOVATIONS BEFORE AFTER BEFORE AFTER 44

45 CONSTRUCTION TO WATCH I wanted to quickly reveal some of the projects we are excited about for, many for different reasons: Salt Development s Hardware Village on 4th West - This is the single nicest property being built in our market. Rumor has it they have a 2-bedroom executive unit renting for $5,500 a month! Marmalade - We hope to see a jumpstart to the sugarhole of Marmalade that will be as many as 300 units. 4th South has seen an explosion of units. Look for Micro Units and smaller studios on several development sites along 4th South. Legacy Village - This is a 55-and-older community in the heart of Sugar House. It is HUGE and cannot be missed. Keep an eye on the Shopko site in Sugar House as well. 616 Lofts & 9th East Lofts - Represents a shift by developers towards subsidized affordable units. We are also seeing the HUD 221-D4 loans coming back into the market. a No rth Salt Lake City International Airport Alta Gateway 500 West 100 South Salt Lake City, Utah Lofts 360 Broadway Salt Lake City, Utah South Prosperity Road South 5600 West 7000 South 3500 South West Valley City Kearns 6200 South 4800 W est 4100 South 7800 South West Jordan 9000 South 4000 W est P arkw ay 4700 South 3200 West South Jordan South 2700 West 2200 West Salt Lake City Taylorsville South N or th Bo u le v ar d Templ e 7000 South Red wood Road 5400 South 00 West 900 West Be c k St reet!(!(!(!(!( South Salt Lake 700 West 500 West Murray Midvale West So u th 800 Sou th State Street 5900 South 7200 Sou th 89!( 1300 South 500 East 700 East!(!( 3300 South 900 East 7800 South 1300 East South S u nnysid e Avenu e 1700 South 2700 South 4500 South Millcreek Holladay Cottonwood Heights Cr eek N Sandy 2300 East R o ad e wcas tle South D r ive th West 255 North 400 West Salt Lake City, Utah Liberty Crest 150 South 200 East Salt Lake City, Utah The Bonneville 252 South 500 East Salt Lake City, UT S ou th Legacy Village of Sugar House 1212 East Wilmington Avenue Salt Lake City, UT Mill c r eek Can y on 9th East Lofts 3609 South 900 East Salt Lake City, Utah B ig Cot ton w oo d Can yo n Li tt le C ott o nw o od East Village One 159 East Midvillage Boulevard Sandy, Utah Can yo n 45

46 MULTIHOUSING TRENDS Some of the more recent trends in multihousing we noted in 2016 are: ROBOTIC MODULAR FURNITURE FOR MICRO UNITS FLOORPLANS One of the challenges facing renters in smaller micro units ( SF) is how to create a flexible and livable space without sacrificing the comforts of bedroom furniture. A spin-off from a team at MIT created a system which merges robotics and modular furniture in small spaces and adapts to the needs of the residents by making due with the spaces they have in their apartments. This system can robotically change the modular furniture from a living room space into a bedroom within seconds following a touch of a single button and is easily incorporated into smart systems, allowing residents to reconfigure their living space from remote locations. Presently, the system is being incorporated by a major developer in Boston and will expand into properties in Washington, D.C. and Seattle in. BICYCLE-FRIENDLY COMMUNITIES Reflective of the new trend in most major cities, Salt Lake City notwithstanding, where bike lanes have multiplied and residents are more environmentally conscious, biking to work or play has become extremely popular. Developers of multihousing communities are catering to this trend by incorporating more bicycle-friendly amenities both in new construction and through existing community retrofits. The evolution of bike rooms has made them a must-have amenity at these communities. These bike rooms are being designed with space explicitly carved out for bike enthusiasts to include controlled-access storage with security cameras, bike lockers, repair equipment, personal storage lockers for helmets and backpacks, air pumps, water coolers, and bike kitchens complete with repair tools, vending machines for tubes, patch kits, energy bars, fruit, etc. ENHANCED RESIDENT PACKAGE DELIVERY The dramatic rise of online shopping is evident in the results of a recent survey of apartment residents conducted by Concept Community which indicates that 62% of all residents receive two or more packages per month at home. Using those metrics, a typical 300-unit community would average over 30 packages delivered to it on a daily basis! The astronomical growth of online shopping will create even greater demand for more efficient, resident-friendly package delivery systems. Owners and managers of existing communities are struggling to keep up with such volume; as many as 26% of the residents have experienced problems and/or inefficiencies with receiving packages at their communities. As a result, owners and managers are converting some common areas to configure individual package lockers in lieu of resident storages spaces. In many cases, residents are willing to pay a $10 monthly fee for a reserved package locker. Another option for some communities is providing residents with in-unit deliveries by management staff upon the resident s written consent. Presently, multihousing developers are incorporating more efficient 24-7 resident parcel reception areas, as well as adding full-time on-site porter positions to address this growing need. 46

47 CONCLUSION

48 NAIOP SYMPOSIUM Mark had the opportunity to speak on the Utah Multihousing Market at the NAIOP Symposium on January 19th. Below are some excerpts of the information he shared with those in attendance at that event. Please contact us for more details on these topics and for the rest of Mark's presentation. We would be happy to further discuss market intel with you. MULTIFAMILY Historical Cap Rates Price per Square Foot MULTIFAMILY Cap Rates by Property Age 6.39% 5.88% 5.70% 5.31% 5.55% 5.56% 5.15% 5.01% s 1950s 1960s 1970s 1980s 1990s 2000s 2010s 7 MULTIFAMILY Total Units Sold MULTIFAMILY Rent Growth Overview YOY 5,953 4,159 6,633 4, % 15.10% 12.48% 2,299 2,069 3,019 3,072 2,670 SUGARHOUSE 2 Bed 2 Bath OVERALL RENT GROWTH MIDVALLEY 2 Bed 1 Bath DOWNTOWN Studio -4.57% 4 10 MULTIFAMILY Top 10 Metros for Rent Growth (Year-Over-Year) 11.9% MULTIFAMILY Price / Unit $200,333 $115, % 6.7% 6.7% 6.4% 5.7% 5.6% 5.5% 5.4% 5.4% $80,969 9 Class A Class B Class C 8 MULTIFAMILY National Cap Rates 5 48