CoStar Industrial Statistics. Y e a r - E n d Dallas/Ft. Worth Industrial Market

Transcription

1 CoStar Industrial Statistics Y e a r - E n d

2 Year-End 2016 Dallas/Ft. Worth Table of Contents Table of Contents A Methodology B Terms & Definitions C Market Highlights & Overview CoStar Markets & Submarkets Inventory & Development Analysis Inventory & Development Analysis Select Top Deliveries Select Top Under Construction Properties Figures at a Glance Figures at a Glance by Building Type & Market Figures at a Glance by Building Type & Submarket Historical Figures at a Glance Leasing Activity Analysis Select Top Lease Transactions Sales Activity Analysis Sales Activity Analysis Select Top Sales Transactions Analysis of Individual CoStar Submarket Clusters DFW Airport Market East Dallas Market Great SW/Arlington Market North Ft Worth Market Northeast Dallas Market Northwest Dallas Market South Dallas Market South Ft Worth Market South Stemmons Market 2017 CoStar Group, Inc. CoStar Industrial Statistics A

3 Dallas/Ft. Worth Year-End 2016 Methodology The CoStar Industrial Statistics calculates Industrial statistics using CoStar Group's base of existing, under construction and under renovation Industrial buildings in each given metropolitan area. All Industrial building types are included, including warehouse, flex / research & development, distribution, manufacturing, industrial showroom, and service buildings, in both single-tenant and multi-tenant buildings, including owner-occupied buildings. CoStar Group's global database includes approximately 95.6 billion square feet of coverage in 4.4 million properties. All rental rates reported in the CoStar Industrial Report are calculated using the quoted rental rate for each property. For information on subscribing to CoStar s other products and services, please contact us at COSTAR, or visit our web site at Copyright 2017 CoStar Group, Inc. All Rights Reserved. Although CoStar makes efforts to ensure the accuracy and reliability of the information contained herein, CoStar makes no guarantee, representation or warranty regarding the quality, accuracy, timeliness or completeness of the information. The publication is provided as is and CoStar expressly disclaims any guarantees, representations or warranties of any kind, including those of MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. CoStar Group, Inc L ST NW Washington, DC (800) NASDAQ: CSGP B CoStar Industrial Statistics 2017 CoStar Group, Inc.

4 Year-End 2016 Dallas/Ft. Worth Terms & Definitions Availability Rate: The ratio of available space to total rentable space, calculated by dividing the total available square feet by the total rentable square feet. Available Space: The total amount of space that is currently being marketed as available for lease in a given time period. It includes any space that is available, regardless of whether the space is vacant, occupied, available for sublease, or available at a future date. Build-to-Suit: A term describing a particular property, developed specifically for a certain tenant to occupy, with structural features, systems, or improvement work designed specifically for the needs of that tenant. A build-to-suit can be leased or owned by the tenant. In a leased build-to-suit, a tenant will usually have a long term lease on the space. Buyer: The individual, group, company, or entity that has purchased a commercial real estate asset. Cap Rate: Short for capitalization rate. The Cap Rate is a calculation that reflects the relationship between one year s net operating income and the current market value of a particular property. The Cap Rate is calculated by dividing the annual net operating income by the sales price (or asking sales price). CBD: Abbreviation for Central Business District. (See also: Central Business District) Central Business District: The designations of Central Business District (CBD) and Suburban refer to a particular geographic area within a metropolitan statistical area (MSA) describing the level of real estate development found there. The CBD is characterized by a high density, well organized core within the largest city of a given MSA. Class A: A classification used to describe buildings that generally qualify as extremely desirable investment-grade properties and command the highest rents or sale prices compared to other buildings in the same market. Such buildings are well located and provide efficient tenant layouts as well as high quality, and in some buildings, one-ofa-kind floor plans. They can be an architectural or historical landmark designed by prominent architects. These buildings contain a modern mechanical system, and have above-average maintenance and management as well as the best quality materials and workmanship in their trim and interior fittings. They are generally the most attractive and eagerly sought by investors willing to pay a premium for quality. Class B: A classification used to describe buildings that generally qualify as a more speculative investment, and as such, command lower rents or sale prices compared to Class A properties. Such buildings offer utilitarian space without special attractions, and have ordinary design, if new or fairly new; good to excellent design if an older non-landmark building. These buildings typically have average to good maintenance, management and tenants. They are less appealing to tenants than Class A properties, and may be deficient in a number of respects including floor plans, condition and facilities. They lack prestige and must depend chiefly on a lower price to attract tenants and investors. Class C: A classification used to describe buildings that generally qualify as no-frills, older buildings that offer basic space and command lower rents or sale prices compared to other buildings in the same market. Such buildings typically have below-average maintenance and management, and could have mixed or low tenant prestige, inferior elevators, and/or mechanical/electrical systems. These buildings lack prestige and must depend chiefly on a lower price to attract tenants and investors. Construction Starts: Buildings that began construction during a specific period of time. (See also: Deliveries) Contiguous Blocks of Space: Space within a building that is, or is able to be joined together into a single contiguous space. Deliveries: Buildings that complete construction during a specified period of time. In order for space to be considered delivered, a certificate of occupancy must have been issued for the property. Delivery Date: The date a building completes construction and receives a certificate of occupancy. Developer: The company, entity or individual that transforms raw land to improved property by use of labor, capital and entrepreneurial efforts. Direct Space: Space that is being offered for lease directly from the landlord or owner of a building, as opposed to space being offered in a building by another tenant (or broker of a tenant) trying to sublet a space that has already been leased. Existing Inventory: The square footage of buildings that have received a certificate of occupancy and are able to be occupied by tenants. It does not include space in buildings that are either planned, under construction or under renovation. Flex Building: A type of building designed to be versatile, which may be used in combination with office (corporate headquarters), research and development, quasi-retail sales, and including but not limited to industrial, warehouse, and distribution uses. A typical flex building will be one or two stories with at least half of the rentable area being used as office space, have ceiling heights of 16 feet or less, and have some type of drive-in door, even though the door may be glassed in or sealed off. Full Service Rental Rate: Rental rates that include all operating expenses such as utilities, electricity, janitorial services, taxes and insurance. Gross Absorption: The total change in occupied space over a given period of time, counting space that is occupied but not space that is vacated by tenants. Gross absorption differs from leasing Activity, which is the sum of all space leased over a certain period of time. Unless otherwise noted Gross Absorption includes direct and sublease space. Growth in Inventory: The change in size of the existing square footage in a given area over a given period of time, generally due to the construction of new buildings. Industrial Building: A type of building adapted for such uses as the assemblage, processing, and/or manufacturing of products from raw materials or fabricated parts. Additional uses include warehousing, distribution, and maintenance facilities. The primary purpose of the space is for storing, producing, assembling, or distributing product. Landlord Rep: (Landlord Representative) In a typical lease transaction between an owner/landlord and tenant, the broker that represents the interests of the owner/landlord is referred to as the Landlord Rep. Leased Space: All the space that has a financial lease obligation. It includes all leased space, regardless of whether the space is currently occupied by a tenant. Leased space also includes space being offered for sublease. Leasing Activity: The volume of square footage that is committed to and signed under a lease obligation for a specific building or market in a given period of time. It includes direct leases, subleases and renewals of existing leases. It also includes any pre-leasing activity in planned, under construction, or under renovation buildings. Market: Geographic boundaries that serve to delineate core areas that are competitive with each other and constitute a generally accepted primary competitive set of areas. Markets are building-type specific, and are non-overlapping contiguous geographic designations having a cumulative sum that matches the boundaries of the entire Region (See also: Region). Markets can be further subdivided into Submarkets. (See also: Submarkets) Multi-Tenant: Buildings that house more than one tenant at a given time. Usually, multi-tenant buildings were designed and built to accommodate many different floor plans and designs for different 2017 CoStar Group, Inc. CoStar Industrial Statistics C

5 Dallas/Ft. Worth Year-End 2016 tenant needs. (See also: Tenancy). Net Absorption: The net change in occupied space over a given period of time. Unless otherwise noted Net Absorption includes direct and sublease space. Net Rental Rate: A rental rate that excludes certain expenses that a tenant could incur in occupying office space. Such expenses are expected to be paid directly by the tenant and may include janitorial costs, electricity, utilities, taxes, insurance and other related costs. New Space: Sometimes called first generation space, refers to space that has never been occupied and/or leased by a tenant. Occupied Space: Space that is physically occupied by a tenant. It does not include leased space that is not currently occupied by a tenant. Office Building: A type of commercial building used exclusively or primarily for office use (business), as opposed to manufacturing, warehousing, or other uses. Office buildings may sometimes have other associated uses within part of the building, i.e., retail sales, financial, or restaurant, usually on the ground floor. Owner: The company, entity, or individual that holds title on a given building or property. Planned/Proposed: The status of a building that has been announced for future development but not yet started construction. Preleased Space: The amount of space in a building that has been leased prior to its construction completion date, or certificate of occupancy date. Price/SF: Calculated by dividing the price of a building (either sales price or asking sales price) by the Rentable Building Area (RBA). Property Manager: The company and/or person responsible for the day-to-day operations of a building, such as cleaning, trash removal, etc. The property manager also makes sure that the various systems within the building, such as the elevators, HVAC, and electrical systems, are functioning properly. Quoted Rental Rate: The asking rate per square foot for a particular building or unit of space by a broker or property owner. Quoted rental rates may differ from the actual rates paid by tenants following the negotiation of all terms and conditions in a specific lease. RBA: Abbreviation for Rentable Building Area. (See also: Rentable Building Area) Region: Core areas containing a large population nucleus, that together with adjacent communities have a high degree of economic and social integration. Regions are further divided into market areas, called Markets. (See also: Markets) Relet Space: Sometimes called second generation or direct space, refers to existing space that has previously been occupied by another tenant. Rentable Building Area: (RBA) The total square footage of a building that can be occupied by, or assigned to a tenant for the purpose of determining a tenant s rental obligation. Generally RBA includes a percentage of common areas including all hallways, main lobbies, bathrooms, and telephone closets. Rental Rates: The annual costs of occupancy for a particular space quoted on a per square foot basis. Sales Price: The total dollar amount paid for a particular property at a particular point in time. Sales Volume: The sum of sales prices for a given group of buildings in a given time period. Seller: The individual, group, company, or entity that sells a particular commercial real estate asset. SF: Abbreviation for Square Feet. Single-Tenant: Buildings that are occupied, or intended to be occupied by a single tenant. (See also: Build-to-suit and Tenancy) Sublease Space: Space that has been leased by a tenant and is being offered for lease back to the market by the tenant with the lease obligation. Sublease space is sometimes referred to as sublet space. Submarkets: Specific geographic boundaries that serve to delineate a core group of buildings that are competitive with each other and constitute a generally accepted primary competitive set, or peer group. Submarkets are building type specific (office, industrial, retail, etc.), with distinct boundaries dependent on different factors relevant to each building type. Submarkets are non-overlapping, contiguous geographic designations having a cumulative sum that matches the boundaries of the Market they are located within (See also: Market). Suburban: The Suburban and Central Business District (CBD) designations refer to a particular geographic area within a metropolitan statistical area (MSA). Suburban is defined as including all office inventory not located in the CBD. (See also: CBD) Tenancy: A term used to indicate whether or not a building is occupied by multiple tenants (See also: Multi-tenant) or a single tenant. (See also: Single-tenant) Tenant Rep: Tenant Rep stands for Tenant Representative. In a typical lease transaction between an owner/landlord and tenant, the broker that represents the interests of the tenant is referred to as a Tenant Rep. Time On Market: A measure of how long a currently available space has been marketed for lease, regardless of whether it is vacant or occupied. Under Construction: Buildings in a state of construction, up until they receive their certificate of occupancy. In order for CoStar to consider a building under construction, the site must have a concrete foundation in place. Abbreviated UC. Rate: A measurement expressed as a percentage of the total amount of physically vacant space divided by the total amount of existing inventory. Under construction space generally is not included in vacancy calculations. Vacant Space: Space that is not currently occupied by a tenant, regardless of any lease obligation that may be on the space. Vacant space could be space that is either available or not available. For example, sublease space that is currently being paid for by a tenant but not occupied by that tenant, would be considered vacant space. Likewise, space that has been leased but not yet occupied because of finish work being done, would also be considered vacant space. Weighted Average Rental Rate: Rental rates that are calculated by factoring in, or weighting, the square footage associated with each particular rental rate. This has the effect of causing rental rates on larger spaces to affect the average more than that of smaller spaces. The weighted average rental rate is calculated by taking the ratio of the square footage associated with the rental rate on each individual available space to the square footage associated with rental rates on all available spaces, multiplying the rental rate by that ratio, and then adding together all the resulting numbers. Unless specifically specified otherwise, rental rate averages include both Direct and Sublet available spaces. Year Built: The year in which a building completed construction and was issued a certificate of occupancy. YTD: Abbreviation for Year-to-Date. Describes statistics that are cumulative from the beginning of a calendar year through whatever time period is being studied. D CoStar Industrial Statistics 2017 CoStar Group, Inc.

6 Overview Year-End 2016 Dallas/Ft. Worth Dallas/Ft. Worth s Stays at 6.1% Net Absorption Positive 4,090,300 SF in the Quarter The Dallas/Ft. Worth Industrial market ended the fourth quarter 2016 with a vacancy rate of 6.1%. The vacancy rate was unchanged over the previous quarter, with net absorption totaling positive 4,090,300 square feet in the fourth quarter. Vacant sublease space increased in the quarter, ending at 1,485,655 square feet. Rental rates ended the fourth quarter at $5.61, an increase over the previous quarter. A total of 26 buildings delivered to the market in the quarter totaling 4,459,247 square feet, with 24,178,225 square feet still under construction at the end of the quarter. Absorption Net absorption for the overall Dallas/Ft. Worth Industrial market was positive 4,090,300 square feet in the fourth quarter That compares to positive 10,245,918 square feet in the third quarter 2016, positive 2,579,548 square feet in the second quarter 2016, and positive 6,535,463 square feet in the first quarter Tenants moving out of large blocks of space in 2016 include: Lego Systems Inc. moving out of (756,000) square feet at Alliance Gateway 60, Shippers Warehouse moving out of (367,750) square feet at 1201 Big Town Blvd, and IDQ Holdings, Inc. moving out of (253,900) square feet at 2901 W Kingsley Rd. Tenants moving into large blocks of space in 2016 include: Lego Systems moving into 1,440,000 square feet at 5600 Mark IV Pky, NFI moving into 1,128,227 square feet at Southfield Park 35, Building 1, and Amazon moving into 1,041,879 square feet at Trammell Crow at 35 Eagle - Building B. The Flex building market recorded net absorption of positive 372,739 square feet in the fourth quarter 2016, compared to positive 291,802 square feet in the third quarter 2016, positive 254,129 in the second quarter 2016, and positive 303,017 in the first quarter The Warehouse building market recorded net absorption of positive 3,717,561 square feet in the fourth quarter 2016 compared to positive 9,954,116 square feet in the third quarter 2016, positive 2,325,419 in the second quarter 2016, and positive 6,232,446 in the first quarter The Industrial vacancy rate in the Dallas/Ft. Worth market area remained at 6.1% at the end of the fourth quarter The vacancy rate was 6.1% at the end of the third quarter 2016, 6.8% at the end of the second quarter 2016, and 6.4% at the end of the first quarter Flex projects reported a vacancy rate of 7.0% at the end of the fourth quarter 2016, 7.3% at the end of the third quarter 2016, 7.5% at the end of the second quarter 2016, and 7.7% at the end of the first quarter Warehouse projects reported a vacancy rate of 6.0% at the end of the fourth quarter 2016, 5.9% at the end of third quarter 2016, 6.6% at the end of the second quarter 2016, and 6.2% at the end of the first quarter Largest Lease Signings The largest lease signings occurring in 2016 included: the 1,440,000-square-foot lease signed by Lego Systems at 5600 Mark IV Pky in the North Ft Worth market; the 1,128,227- square-foot deal signed by NFI at Southfield Park 35, Building Rates by Building Type % Flex Warehouse Total Market 12% 10% Rate 8% 6% 4% 2% 0% q q q q q q q q q q q q q q q q CoStar Group, Inc. CoStar Industrial Statistics 1

7 Dallas/Ft. Worth Year-End 2016 Overview 1 in the South Dallas market; and the 1,052,380-square-foot lease signed by Amazon at Logistics Center I in the DFW Airport market. Sublease The amount of vacant sublease space in the Dallas/Ft. Worth market increased to 1,485,655 square feet by the end of the fourth quarter 2016, from 1,368,129 square feet at the end of the third quarter There was 987,953 square feet vacant at the end of the second quarter 2016 and 950,543 square feet at the end of the first quarter Dallas/Ft. Worth s Flex projects reported vacant sublease space of 97,438 square feet at the end of fourth quarter 2016, down from the 99,491 square feet reported at the end of the third quarter There were 71,453 square feet of sublease space vacant at the end of the second quarter 2016, and 154,207 square feet at the end of the first quarter Warehouse projects reported increased vacant sublease space from the third quarter 2016 to the fourth quarter Sublease vacancy went from 1,268,638 square feet to 1,388,217 square feet during that time. There was 916,500 square feet at the end of the second quarter 2016, and 796,336 square feet at the end of the first quarter Rental Rates The average quoted asking rental rate for available Industrial space was $5.61 per square foot per year at the end of the fourth quarter 2016 in the Dallas/Ft. Worth market area. This represented a 4.5% increase in quoted rental rates from the end of the third quarter 2016, when rents were reported at $5.37 per square foot. The average quoted rate within the Flex sector was $9.61 per square foot at the end of the fourth quarter 2016, while Warehouse rates stood at $4.70. At the end of the third quarter 2016, Flex rates were $9.47 per square foot, and Warehouse rates were $4.48. U.S. Comparison Past 10 Quarters Rate 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Dallas/Ft Worth United States q Deliveries and Construction During the fourth quarter 2016, 26 buildings totaling 4,459,247 square feet were completed in the Dallas/Ft. Worth market area. This compares to 26 buildings totaling 5,749,390 square feet that were completed in the third quarter 2016, 20 buildings totaling 5,336,381 square feet completed in the second quarter 2016, and 4,251,775 square feet in 34 buildings completed in the first quarter There were 24,178,225 square feet of Industrial space under construction at the end of the fourth quarter Some of the notable 2016 deliveries include: Lego Systems, a 1,440,000-square-foot facility that delivered in third quarter 2016 and is now 100% occupied, and SouthPort Logistics Park - Building 1, a 1,075,260-square-foot building that delivered in fourth quarter The largest projects underway at the end of fourth quarter 2016 were Logistics Center II, a 1,008,176-square-foot building with 0% of its space pre-leased, and Arlington Commerce Center - Building E, a 1,004,400-square-foot facility that is 0% pre-leased. Inventory Total Industrial inventory in the Dallas/Ft. Worth market area amounted to 845,606,269 square feet in 20,883 buildings as of the end of the fourth quarter The Flex sector consisted of 131,965,095 square feet in 6,953 projects. The Warehouse sector consisted of 713,641,174 square feet in 13,930 buildings. Within the Industrial market there were 3,377 owneroccupied buildings accounting for 220,724,997 square feet of Industrial space. Sales Activity Tallying industrial building sales of 15,000 square feet or larger, Dallas/Ft Worth industrial sales figures fell during the third quarter 2016 in terms of dollar volume compared to the second quarter of In the third quarter, 11 industrial transactions closed with a total volume of $122,144,000. The 11 buildings totaled 1,341,627 square feet and the average price per square foot equated to $91.04 per square foot. That compares to 16 transactions totaling $175,089,885 in the second quarter. The total square footage was 2,608,174 for an average price per square foot of $ Total year-to-date industrial building sales activity in 2016 is down compared to the previous year. In the first nine months of 2016, the market saw 33 industrial sales transactions with a total volume of $305,783,885. The price per square foot has averaged $74.28 this year. In the first nine months of 2015, the market posted 46 transactions with a total volume of $522,331,479. The price per square foot averaged $ Cap rates have been higher in 2016, averaging 8.54%, compared to the first nine months of last year when they averaged 8.08%. 2 CoStar Industrial Statistics 2017 CoStar Group, Inc.

8 Overview Year-End 2016 Dallas/Ft. Worth One of the largest transactions that has occurred within the last four quarters in the Dallas/Ft Worth market is the sale of Parc North in Fort Worth. This 446,420-square-foot industrial portfolio sold for $32,000,000, or $71.68 per square foot. The property sold on 07/08/16. Report compiled by Alissa Spittel, Research Manager, Jeff Warnock, Research Manager and James Lutz, Certified Research Analyst Absorption & Deliveries Past 10 Quarters Net Absorption Deliveries q 2017 CoStar Group, Inc. CoStar Industrial Statistics 3

9 Dallas/Ft. Worth Year-End 2016 Markets CoStar Submarket Clusters & Submarkets In analyzing metropolitan areas, CoStar has developed geographic designations to help group properties together, called Markets, Submarket Clusters and Submarkets. Markets are the equivalent of metropolitan areas, or areas containing a large population nucleus, that together with adjacent communities have a high degree of economic and social integration. Markets are then divided into Submarket Clusters, which are core areas within a metropolitan area that are known to be competitive with each other in terms of attracting and keeping tenants. Markets are then further subdivided into smaller units called Submarkets, which serve to delineate a core group of buildings that are competitive with each other and constitute a generally accepted competitive set, or peer group. Submarket Clusters Submarkets DFW Airport Ind E DFW Air/Las Colinas Ind W DFW Air/Grapevine Ind East Dallas Ind Central East Dallas Ind East Dallas/Mesquite Ind Forney/Terrll/Kauf Cy Ind Outlying Kaufman Cnty Ind Great SW/Arlington Ind Arlington Ind Lower Great Southwest Ind Upper Great Southwest Ind North Ft Worth Ind Meacham Fld/Fossil Cr Ind NE Tarrant/Alliance Ind Parker County Ind West Tarrant Ind Wise County Ind Northeast Dallas Ind Allen/McKinney Ind Delta County Ind Hunt County Ind NE Dallas/Garland Ind Outlying Collin Cnty Ind Plano Ind Richardson Ind Rockwall Ind Northwest Dallas Ind Denton Ind Lewisville Ind Metropolitan/Addison Ind N Stemmons/Valwood Ind South Dallas Ind Henderson County Ind Outlying Ellis Cnty Ind Redbird Airport Ind SE Dallas/I-45 Ind SW Dallas/US 67 Ind South Ft Worth Ind East Ft Worth Ind Hood County Ind Johnson County Ind Mansfield Ind N Central Ft Worth Ind S Cen.Tarrant Cnty Ind S Central Ft Worth Ind Southwest Tarrant Ind South Stemmons Ind East Brookhollow Ind East Hines North Ind Eastern Lonestar/Tpke Ind North Trinity Ind West Brookhollow Ind West Hines North Ind Western Lonestar/Tpke Ind 4 CoStar Industrial Statistics 2017 CoStar Group, Inc.

10 Inventory & development Year-End 2016 Dallas/Ft. Worth Historical Deliveries Deliveries Average Delivered SF Millions of SF * Future deliveries based on current under construction buildings. Construction Activity Markets Ranked by Under Construction RBA Under Construction Inventory Average Bldg Size Market # Bldgs Total RBA Preleased SF Preleased % All Existing U/C Great SW/Arlington Ind 16 5,948,646 1,127, % 58, ,790 South Dallas Ind 11 5,252, , % 51, ,476 North Ft Worth Ind 11 3,307,066 1,495, % 60, ,642 Northeast Dallas Ind 29 3,306,917 1,718, % 37, ,032 DFW Airport Ind 17 2,833, , % 80, ,663 Northwest Dallas Ind 14 2,436,522 1,496, % 53, ,037 South Stemmons Ind 2 523,702 5, % 28, ,851 East Dallas Ind 2 351, , % 25, ,930 South Ft Worth Ind 6 218, , % 26,812 36,333 Totals ,178,225 7,289, % 40, ,872 Recent Deliveries Leased & Un-Leased SF in Deliveries Since 2012 Future Deliveries Preleased & Un-Leased SF in Properties Scheduled to Deliver 25.0 Leased Un-Leased 18,000 Preleased Un-Leased 16, ,000 Millions of SF Thousands of SF 12,000 10,000 8,000 6, ,000 2, q q 2017 CoStar Group, Inc. CoStar Industrial Statistics 5

11 Dallas/Ft. Worth Year-End 2016 Inventory & development Historical Construction Starts & Deliveries Square Footage Per Quarter Starting and Completing Construction 10.0 Construction Starts Deliveries Millions of SF q q q q Recent Deliveries by Project Size Breakdown of Year-to-Date Development Based on RBA of Project Building Size # Bldgs RBA SF Leased % Leased Avg Rate Single-Tenant Multi-Tenant < 50,000 SF , , % $ , ,596 50,000 SF - 99,999 SF 6 435, , % $ , ,000 SF - 249,999 SF 33 5,947,840 3,965, % $4.46 1,395,590 4,552, ,000 SF - 499,999 SF 19 6,679,372 2,917, % $5.13 1,800,380 4,878,992 >= 500,000 SF 7 6,099,832 4,675, % $3.37 3,978,836 2,120,996 Recent Development by Tenancy Existing Inventory Comparison Based on RBA Developed for Single & Multi-Tenant Use Based on Total RBA 2016 Deliveries Currently Under Construction By Building Type By Tenancy Type 37% 20% 84% 16% 52% 48% 63% 80% Multi Single Multi Single Flex Warehouse Multi Single 6 CoStar Industrial Statistics 2017 CoStar Group, Inc.

12 Inventory & development Year-End 2016 Dallas/Ft. Worth 2017 CoStar Group, Inc. CoStar Industrial Statistics 7

13 Dallas/Ft. Worth Year-End 2016 Inventory & development 8 CoStar Industrial Statistics 2017 CoStar Group, Inc.

14 Figures at a Glance Year-End 2016 Dallas/Ft. Worth Flex Market Statistics Year-End 2016 Existing Inventory YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates DFW Airport Ind 346 9,596,219 1,191,717 1,198, % 20, ,600 $9.30 East Dallas Ind 654 8,565,406 1,005,902 1,013, % 17,750 25,755 0 $9.18 Great SW/Arlington Ind ,730,739 1,085,499 1,092, % 217,888 56,195 11,000 $8.90 North Ft Worth Ind 291 5,751, , , % 5, ,000 $9.24 Northeast Dallas Ind 1,284 29,705,013 1,827,342 1,854, % 441,034 94,180 1,656,220 $9.45 Northwest Dallas Ind ,204,576 1,864,092 1,877, % 417,601 6, ,993 $10.09 South Dallas Ind 406 4,520,449 90,273 90, % 31, ,000 $7.79 South Ft Worth Ind ,411, , , % 128, $8.23 South Stemmons Ind 1,811 28,479,046 1,259,456 1,288, % (58,871) 0 5,461 $10.67 Totals 6, ,965,095 9,113,181 9,210, % 1,221, ,780 2,429,274 $9.61 Warehouse Market Statistics Year-End 2016 Existing Inventory YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates DFW Airport Ind ,513,187 3,464,906 3,484, % 2,106,861 1,072,478 2,826,679 $4.63 East Dallas Ind 1,308 41,860,032 1,827,542 1,837, % (390,412) 5, ,860 $3.64 Great SW/Arlington Ind 1,270 92,214,593 5,350,294 5,672, % 1,639,508 4,154,841 5,937,646 $4.09 North Ft Worth Ind 1,154 81,121,726 5,955,765 6,027, % 6,666,466 4,453,232 3,057,066 $4.16 Northeast Dallas Ind 1,710 83,256,553 3,566,887 4,223, % 1,463, ,995 1,650,697 $5.61 Northwest Dallas Ind 1,272 86,611,356 4,423,014 4,602, % 2,781,961 2,227,537 1,951,529 $4.93 South Dallas Ind 1,362 86,235,512 6,970,407 6,970, % 5,897,757 6,261,686 5,237,233 $3.69 South Ft Worth Ind 2,388 75,013,826 2,574,978 2,606, % 1,332, , ,000 $4.44 South Stemmons Ind 2, ,814,389 7,090,046 7,187, % 731, , ,241 $5.77 Totals 13, ,641,174 41,223,839 42,612, % 22,229,542 19,614,013 21,748,951 $4.70 Total Industrial Market Statistics Year-End 2016 Existing Inventory YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates DFW Airport Ind ,109,406 4,656,623 4,682, % 2,127,405 1,072,478 2,833,279 $5.64 East Dallas Ind 1,962 50,425,438 2,833,444 2,851, % (372,662) 30, ,860 $4.09 Great SW/Arlington Ind 1, ,945,332 6,435,793 6,765, % 1,857,396 4,211,036 5,948,646 $4.69 North Ft Worth Ind 1,445 86,873,383 6,270,884 6,342, % 6,671,641 4,453,232 3,307,066 $4.57 Northeast Dallas Ind 2, ,961,566 5,394,229 6,077, % 1,904, ,175 3,306,917 $6.84 Northwest Dallas Ind 2, ,815,932 6,287,106 6,480, % 3,199,562 2,234,187 2,436,522 $6.28 South Dallas Ind 1,768 90,755,961 7,060,680 7,060, % 5,929,494 6,261,686 5,252,233 $3.97 South Ft Worth Ind 3,298 88,425,816 3,048,759 3,085, % 1,461, , ,000 $4.88 South Stemmons Ind 4, ,293,435 8,349,502 8,476, % 672, , ,702 $6.75 Totals 20, ,606,269 50,337,020 51,822, % 23,451,229 19,796,793 24,178,225 $ CoStar Group, Inc. CoStar Industrial Statistics 9

15 Dallas/Ft. Worth Year-End 2016 Figures at a Glance Flex Submarket Statistics Year-End 2016 Existing Inventory YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Allen/McKinney Ind 83 2,486, , , % 49,337 58,875 0 $11.74 Arlington Ind 165 3,061, , , % (30,979) 14,046 11,000 $10.47 Central East Dallas ,103, , , % (24,327) 0 0 $9.20 Delta County Ind % $0.00 Denton Ind 55 1,855,559 81,361 81, % (67,411) 0 0 $6.91 E DFW Air/Las Colina ,005,563 1,011,403 1,014, % (22,863) 0 0 $9.59 East Brookhollow Ind 120 2,074, , , % (55,079) 0 0 $16.00 East Dallas/Mesquite ,927, , , % 50,777 25,755 0 $9.20 East Ft Worth Ind 287 4,824, , , % 28, $6.56 East Hines North Ind 397 6,561, , , % 85, $7.12 Eastern Lonestar/Tpk ,244, , , % (25,486) 0 0 $5.83 Forney/Terrll/Kauf C ,847 8,700 8, % (8,700) 0 0 $8.83 Henderson County Ind ,536 14,132 14, % (14,132) 0 0 $6.00 Hood County Ind ,701 32,575 32, % (10,729) 0 0 $9.76 Hunt County Ind , % 17, $4.61 Johnson County Ind ,080 11,700 11, % 10, $9.69 Lewisville Ind 137 3,061, , , % 59, ,000 $11.76 Lower Great Southwes ,345, , , % 168, $8.47 Mansfield Ind , % 5, $11.72 Meacham Fld/Fossil C ,410, , , % 11, $8.26 Metropolitan/Addison ,006, , , % 271, $11.03 N Central Ft Worth I ,964,329 64,112 69, % 11, $9.52 N Stemmons/Valwood I ,280, , , % 153,376 6,650 14,993 $8.15 NE Dallas/Garland In ,509, , , % 127, ,000,000 $6.99 NE Tarrant/Alliance. 96 2,549,690 22,180 22, % (11,130) 0 250,000 $10.02 North Trinity Ind 522 6,467, , , % (70,592) 0 5,461 $15.69 Outlying Collin Cnty ,003 12,000 12, % 0 12,000 20,000 $10.12 Outlying Ellis Cnty ,743 8,202 8, % 10, $9.70 Outlying Kaufman Cnt. 6 45, % $0.00 Parker County Ind ,117 10,111 10, % 1, $10.21 Plano Ind 221 6,893, , , % 30,114 23, ,460 $10.63 Redbird Airport Ind ,435 9,700 9, % (4,700) 0 0 $8.53 Richardson Ind 297 9,179, , , % 216, ,760 $9.62 Rockwall Ind ,320 15,900 15, % $10.43 S Cen.Tarrant Cnty I. 76 1,851,184 76,370 76, % 89, $6.82 S Central Ft Worth I ,382, , , % (6,950) 0 0 $10.43 SE Dallas/I-45 Ind 95 1,309,505 12,064 12, % 36, ,000 $7.48 Southwest Tarrant In ,624 3,800 3, % $8.80 SW Dallas/US 67 Ind 175 1,837,230 46,175 46, % 2, $7.31 Upper Great Southwes ,324, , , % 80,409 42,149 0 $8.79 W DFW Air/Grapevine ,590, , , % 43, ,600 $8.07 West Brookhollow Ind 387 7,978, , , % (51,064) 0 0 $7.01 West Hines North Ind 146 2,454,186 97,568 97, % 56, $7.29 West Tarrant Ind , % 3, $13.50 Western Lonestar/Tpk ,295 10,400 10, % 1, $6.38 Wise County Ind 10 79,257 35,134 35, % $4.00 Totals 6, ,965,095 9,113,181 9,210, % 1,221, ,780 2,429,274 $ CoStar Industrial Statistics 2017 CoStar Group, Inc.

16 Figures at a Glance Year-End 2016 Dallas/Ft. Worth Warehouse Submarket Statistics Year-End 2016 Existing Inventory YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Allen/McKinney Ind 189 9,195, , , % 590, , ,331 $7.63 Arlington Ind ,236,443 1,762,551 1,826, % 503,791 1,787,034 1,004,400 $5.05 Central East Dallas ,210, , , % 75, $3.90 Delta County Ind 3 108, % $0.00 Denton Ind 250 8,716, , , % 351, , ,000 $5.87 E DFW Air/Las Colina ,040,460 2,469,020 2,482, % 2,005,705 1,012,478 2,826,679 $4.32 East Brookhollow Ind 177 7,280,657 17,694 17, % 70, $6.95 East Dallas/Mesquite ,813,841 1,016,358 1,016, % (178,949) 0 351,860 $3.52 East Ft Worth Ind ,379,133 1,263,901 1,295, % 152, ,075 0 $4.95 East Hines North Ind ,387, , , % 134, $4.90 Eastern Lonestar/Tpk ,854, , , % 5, , ,241 $3.83 Forney/Terrll/Kauf C ,361, , , % (260,360) 5,000 0 $3.94 Henderson County Ind 89 1,484, % 74, $3.69 Hood County Ind ,842 20,604 20, % 14, $6.91 Hunt County Ind 121 6,859, , , % (30,399) 6,250 0 $3.60 Johnson County Ind 337 8,191, , , % 179,358 22, ,000 $5.35 Lewisville Ind ,154,039 1,899,372 1,977, % 1,700,012 1,295, ,011 $5.26 Lower Great Southwes ,747, ,594 1,019, % 36, , ,094 $3.82 Mansfield Ind 150 4,600, , , % 31,892 58,419 0 $3.47 Meacham Fld/Fossil C ,588,896 1,835,536 1,881, % 4,310,787 3,423, ,826 $3.94 Metropolitan/Addison ,741, , , % (118,275) 0 0 $5.86 N Central Ft Worth I ,776, , , % 81, $5.07 N Stemmons/Valwood I ,999,040 1,870,284 1,955, % 848, , ,518 $4.39 NE Dallas/Garland In ,183,133 2,032,079 2,627, % 837, ,171,366 $3.85 NE Tarrant/Alliance ,340,696 3,813,180 3,813, % 2,332,524 1,007,803 2,393,990 $3.84 North Trinity Ind 431 7,195, , , % (31,089) 0 0 $7.58 Outlying Collin Cnty ,198 45,049 45, % 2, ,000 $11.81 Outlying Ellis Cnty ,208, , , % 22, $6.28 Outlying Kaufman Cnt ,844 31,621 31, % (26,621) 0 0 $3.03 Parker County Ind 189 2,739, , , % 51,908 10,000 0 $7.33 Plano Ind ,511, , , % (260,712) 0 0 $7.43 Redbird Airport Ind ,673,239 1,038,493 1,038, % 1,666,183 1,343, ,000 $3.97 Richardson Ind 110 8,834, , , % 120, $5.66 Rockwall Ind 113 2,766,456 30,000 30, % 204, ,000 0 $11.45 S Cen.Tarrant Cnty I ,865, , , % 878,974 20,000 0 $3.61 S Central Ft Worth I ,828, , , % (55,066) 0 0 $4.62 SE Dallas/I-45 Ind ,842,843 3,327,606 3,327, % 2,232,732 3,793,956 4,574,233 $3.63 Southwest Tarrant In ,670,198 20,339 20, % 49, ,000 $8.24 SW Dallas/US 67 Ind ,027,028 2,432,948 2,432, % 1,901,974 1,124,122 0 $3.47 Upper Great Southwes ,230,650 2,758,149 2,826, % 1,098,768 2,011,714 4,158,152 $4.15 W DFW Air/Grapevine ,472, ,886 1,002, % 101,156 60,000 0 $6.30 West Brookhollow Ind 1,042 35,303, , , % 523, $7.09 West Hines North Ind 220 5,251, , , % (119,105) 0 0 $5.03 West Tarrant Ind 101 4,008,890 41,888 41, % 10,312 12,000 0 $9.07 Western Lonestar/Tpk ,542,000 4,646,371 4,646, % 147,926 13,512 0 $5.63 Wise County Ind 95 1,444, , , % (39,065) 0 16,250 $5.84 Totals 13, ,641,174 41,223,839 42,612, % 22,229,542 19,614,013 21,748,951 $ CoStar Group, Inc. CoStar Industrial Statistics 11

17 Dallas/Ft. Worth Year-End 2016 Figures at a Glance Total Industrial Submarket Statistics Year-End 2016 Existing Inventory YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Allen/McKinney Ind ,681, , , % 639, , ,331 $8.77 Arlington Ind ,297,472 2,172,263 2,235, % 472,812 1,801,080 1,015,400 $6.08 Central East Dallas ,313, , , % 51, $4.74 Delta County Ind 3 108, % $0.00 Denton Ind ,572, , , % 283, , ,000 $6.03 E DFW Air/Las Colina ,046,023 3,480,423 3,496, % 1,982,842 1,012,478 2,826,679 $5.42 East Brookhollow Ind 297 9,355, , , % 15, $11.36 East Dallas/Mesquite ,741,545 1,833,699 1,833, % (128,172) 25, ,860 $3.97 East Ft Worth Ind ,204,120 1,411,147 1,442, % 181, ,075 0 $5.20 East Hines North Ind ,948, , , % 219, $5.46 Eastern Lonestar/Tpk ,098,951 1,112,740 1,112, % (20,023) 556, ,241 $3.90 Forney/Terrll/Kauf C ,850, , , % (269,060) 5,000 0 $4.05 Henderson County Ind 115 1,613,885 14,132 14, % 60, $3.80 Hood County Ind ,543 53,179 53, % 3, $8.25 Hunt County Ind 137 6,979, , , % (13,025) 6,250 0 $3.66 Johnson County Ind 386 8,747, , , % 189,874 22, ,000 $5.60 Lewisville Ind ,216,014 2,332,261 2,417, % 1,759,875 1,295, ,011 $7.43 Lower Great Southwes ,093,038 1,028,578 1,218, % 205, , ,094 $4.29 Mansfield Ind 174 5,434, , , % 36,992 58,419 0 $3.77 Meacham Fld/Fossil C ,999,573 2,083,230 2,129, % 4,322,194 3,423, ,826 $4.14 Metropolitan/Addison ,747,863 1,212,943 1,221, % 153, $8.21 N Central Ft Worth I ,740, , , % 93, $6.09 N Stemmons/Valwood I ,279,673 2,428,012 2,520, % 1,002, , ,511 $5.01 NE Dallas/Garland In. 1,452 50,692,814 2,424,721 3,026, % 964, ,171,366 $4.31 NE Tarrant/Alliance ,890,386 3,835,360 3,835, % 2,321,394 1,007,803 2,643,990 $4.46 North Trinity Ind ,663, , , % (101,681) 0 5,461 $10.46 Outlying Collin Cnty ,201 57,049 57, % 2,644 12, ,000 $11.68 Outlying Ellis Cnty ,640, , , % 33, $7.56 Outlying Kaufman Cnt ,549 31,621 31, % (26,621) 0 0 $3.03 Parker County Ind 222 3,065, , , % 53,056 10,000 0 $7.49 Plano Ind ,405,407 1,248,395 1,326, % (230,598) 23, ,460 $8.64 Redbird Airport Ind ,484,674 1,048,193 1,048, % 1,661,483 1,343, ,000 $4.14 Richardson Ind ,013, , , % 336, ,760 $9.00 Rockwall Ind 146 3,195,776 45,900 45, % 205, ,000 0 $11.06 S Cen.Tarrant Cnty I ,716, , , % 968,887 20,000 0 $3.73 S Central Ft Worth I ,211, , , % (62,016) 0 0 $5.45 SE Dallas/I-45 Ind ,152,348 3,339,670 3,339, % 2,269,632 3,793,956 4,589,233 $3.69 Southwest Tarrant In ,511,822 24,139 24, % 49, ,000 $8.45 SW Dallas/US 67 Ind ,864,258 2,479,123 2,479, % 1,904,663 1,124,122 0 $3.98 Upper Great Southwes ,554,822 3,234,952 3,310, % 1,179,177 2,053,863 4,158,152 $4.77 W DFW Air/Grapevine ,063,383 1,176,200 1,185, % 144,563 60,000 6,600 $6.75 West Brookhollow Ind 1,429 43,281, , , % 472, $7.08 West Hines North Ind 366 7,705, , , % (63,070) 0 0 $5.90 West Tarrant Ind 131 4,394,806 41,888 41, % 14,062 12,000 0 $9.23 Western Lonestar/Tpk ,240,295 4,656,771 4,656, % 149,626 13,512 0 $5.67 Wise County Ind 105 1,523, , , % (39,065) 0 16,250 $5.55 Totals 20, ,606,269 50,337,020 51,822, % 23,451,229 19,796,793 24,178,225 $ CoStar Industrial Statistics 2017 CoStar Group, Inc.

18 Figures at a Glance Year-End 2016 Dallas/Ft. Worth 2017 CoStar Group, Inc. CoStar Industrial Statistics 13

19 Dallas/Ft. Worth Year-End 2016 Leasing Activity Historical Rental Rates Based on Quoted Rental Rates $12.00 Flex Warehouse Total Market $10.00 Dollars/SF/Year $8.00 $6.00 $4.00 $2.00 $ q q q q q q q q 20164q by Available Space Type by Building Type Percent of All Vacant Space in Direct vs. Sublet Percent of All Vacant Space by Building Type Dallas/Ft Worth United States Dallas/Ft Worth United States 3% 3% 18% 14% 82% 86% 97% 97% Direct Sublet Direct Sublet Flex Warehouse Flex Warehouse U.S. Rental Rate Comparison Based on Average Quoted Rental Rates Future Space Available Space Scheduled to be Available for Occupancy* $7.00 Dallas/Ft Worth United States 25.0 $ Dollars/SF/Year $5.00 $4.00 $3.00 $2.00 Millions $ $ q q q q * Includes Under Construction Space 14 CoStar Industrial Statistics 2017 CoStar Group, Inc.

20 Leasing Activity Year-End 2016 Dallas/Ft. Worth Select Top Industrial Leases Based on Leased Square Footage For Deals Signed in 2016 Building Submarket SF Qtr Tenant Name Tenant Rep Company Landlord Rep Company 1 Lego Systems Meacham Fld/Fossil Cr Ind 1,440,000 3rd Lego Systems N/A N/A 2 Southeld Park 35, Building 1 SW Dallas/US 67 Ind 1,128,227 3rd NFI CBRE JLL 3 Logistics Center I E DFW Air/Las Colinas Ind 1,052,380 3rd Amazon N/A Perot Development 4 Trammell Crow at 35 Eagle - Building B NE Tarrant/Alliance Ind 1,041,879 2nd Amazon N/A CBRE 5 Majestic Airport Center DFW - Building 5 Lewisville Ind 799,460 1st Bed Bath & Beyond N/A Majestic Realty Co. 6 Alliance Gateway 60 NE Tarrant/Alliance Ind 756,000 4th American Tire Distributors, Inc. Jackson Cooksey, Inc. Hillwood Properties 7 Mountain Distribution Center II Redbird Airport Ind 663,000 4th Chewy Inc Cushman & Wakeeld of Texas, Inc.; CBRE 8 Waters Ridge III* Lewisville Ind 656,577 2nd Rheem Distribution N/A CBRE 9 Carter Distribution Center - Building One S Cen.Tarrant Cnty Ind 417,600 1st Mother Parkers Tea & Coee Inc. Direct Deal Lee & Associates 10 Park 20/35 - Building 1* SE Dallas/I-45 Ind 393,899 2nd Mars Petcare N/A CBRE 11 Speedway Distribution Center - Building A NE Tarrant/Alliance Ind 390,757 3rd Camping World N/A NAI Robert Lynn; IDI Gazeley 12 Meacham Crossing Meacham Fld/Fossil Cr Ind 318,488 2nd Amazon N/A Holt Lunsford Commercial, Inc. 13 CentrePort - Building 5 Upper Great Southwest Ind 314,758 2nd Ingram Micro JLL CBRE Terminal Rd Meacham Fld/Fossil Cr Ind 308,777 1st The Marco Company Lee & Associates JLL 15 Carter Distribution Center - Building 1 S Cen.Tarrant Cnty Ind 308,109 1st NFI Industries, Inc. N/A Lee & Associates Railhead Rd - Building C* Meacham Fld/Fossil Cr Ind 305,255 2nd Quorum International Direct Deal Bradford Companies 17 International Commerce Park - Building 1 E DFW Air/Las Colinas Ind 301,399 2nd United Stepchildren Cushman & Wakeeld of Texas, Inc. Stream Realty Partners-DFW, L. P. 18 Southeld Park 35 - Building 2 SW Dallas/US 67 Ind 294,952 4th Pratt Industries JLL JLL 19 Alliance Gateway 50* NE Tarrant/Alliance Ind 287,242 2nd Saddle Creek Logistics Service N/A Hillwood Properties 20 Coppell Trade Center - Phase 3 E DFW Air/Las Colinas Ind 279,330 2nd Genco Cushman & Wakeeld of Texas, Inc. Holt Lunsford Commercial, Inc. 21 Point West 400 E DFW Air/Las Colinas Ind 263,625 4th Quaker Sales & Distribution N/A Duke Realty Corporation N 28th Ave* E DFW Air/Las Colinas Ind 263,100 4th Network Distribution Inc N/A CBRE 23 Trinity Mills 1809 N Stemmons/Valwood Ind 235,302 2nd Ingram Micro Inc N/A Duke Realty Corporation 24 First Arlington Commerce II Arlington Ind 234,100 4th Rooms To Go CBRE CBRE 25 Point West 240 E DFW Air/Las Colinas Ind 233,002 2nd HD Supply N/A Duke Realty Corporation 26 Prologis GSW 9 Lower Great Southwest Ind 229,400 3rd Sonwil Distribution Colliers International CBRE Giord St Western Lonestar/Tpke Ind 225,498 3rd OHL CBRE JLL Blue Mound Rd Meacham Fld/Fossil Cr Ind 224,800 1st Anchor Fabrication Transwestern Ft Worth N/A 29 Majestic Airport Center DFW - Building 4 Lewisville Ind 211,312 4th TriMark USA, LLC N/A Majestic Realty Co. 30 Northport 35 Business Center - Building B NE Tarrant/Alliance Ind 202,522 3rd Hempel USA Stream Realty Partners-DFW, L. P. Stream Realty Partners-DFW, L. P. 31 I-30 Business Center - Building 3 Eastern Lonestar/Tpke Ind 202,137 3rd Freeman JLL CBRE 32 JJ Lemmon Distribution Center - Building 1 SE Dallas/I-45 Ind 201,600 2nd American Textile Company JLL CBRE 33 Waters Ridge I* Lewisville Ind 201,000 4th Multiquip Inc N/A CBRE 34 Prologis GSW 36 Lower Great Southwest Ind 200,825 1st Biaggi Transwestern Dallas Lee & Associates 35 RiverPark - 500* Upper Great Southwest Ind 200,000 3rd JanPak Inc Cushman & Wakeeld N/A W Miller Rd NE Dallas/Garland Ind 200,000 1st Amazon CBRE Logistics Realty LLC 37 Speedway Distribution Center - Building A NE Tarrant/Alliance Ind 197,400 2nd Sam s Club Distribution Center N/A NAI Robert Lynn; IDI Gazeley 38 DFW North II - Building 2 Lewisville Ind 185,000 1st Wayfair Inc Transwestern Dallas Transwestern Dallas Forest Ln NE Dallas/Garland Ind 183,996 2nd At Home Stores LLC CBRE Holt Lunsford Commercial, Inc. 40 Kysor Panel Systems* Meacham Fld/Fossil Cr Ind 182,500 3rd Kysor Panel Systems N/A Mercantile Partners, LP * Renewal 2017 CoStar Group, Inc. CoStar Industrial Statistics 15

21 Dallas/Ft. Worth Year-End 2016 Sales Activity The Optimist Sales Index Average of Two Highest Price/SF's and Two Lowest Cap Rates Per Quarter 11.0% Cap Rate Price/SF $940 Cap Rate Percentage 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% $840 $740 $640 $540 $440 $340 $240 $140 Dollars/SF 1.0% q q q $40 Source: CoStar COMPS Sales Volume & Price Sales Analysis by Building Size Based on Industrial Building Sales of 15,000 SF and Larger Based on Industrial Bldg Sales From Oct Sept $300 Sales Volume Price/SF $100 Bldg Size # RBA $ Volume Price/SF Cap Rate Millions of Sales Volume Dollars $250 $200 $150 $100 $50 $90 $80 $70 $60 $50 $40 $30 $20 Price/SF < 25,000 SF 25K-99K SF 100K-249K SF ,676 $36,720,000 $ % 25 1,255,355 $113,399,885 $ % 11 1,483,728 $93,988,000 $ % $10 $ q q q q $0 >250K SF 7 3,871,558 $271,679,000 $ % Source: CoStar COMPS Source: CoStar COMPS U.S. Price/SF Comparison Based on Industrial Building Sales of 15,000 SF and Larger U.S. Cap Rate Comparison Based on Industrial Building Sales of 15,000 SF and Larger $100 Dallas/Ft Worth US 11.0% Dallas/Ft Worth US $ % 9.0% $80 $70 $60 $50 Cap Rate Percentage 8.0% 7.0% 6.0% 5.0% 4.0% $40 3.0% 2.0% $30 1.0% q q q q q q q q Source: CoStar COMPS Source: CoStar COMPS 16 CoStar Industrial Statistics 2017 CoStar Group, Inc.

22 Year-End 2016 Dallas/Ft. Worth 2017 CoStar Group, Inc. CoStar Industrial Statistics 17 Sales Activity