2017 FORT WAYNE, INDIANA OFFICE MARKET SURVEY

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1 2017 FORT WAYNE, INDIANA OFFICE MARKET SURVEY 2017 REVIEW 2018 FORECAST PREPARED WITH THE ASSISTANCE OF Overall, the market conditions have stabilized. The most significant development for the Fort Wayne area office market in 2017 is the relocation of SIRVA (North American Van Lines) to 77,000 sq. ft. on seven floors in the Indiana Michigan Power Center in downtown Fort Wayne. SIRVA is relocating from their corporate campus on U.S. Highway 30. The office vacancy for the total Fort Wayne market increased slightly from 13.85% to 13.98% in the period from October 2016 to October Overall, the Fort Wayne office vacancy rate has decreased approximately five percentage points since the economic downturn of 2008/2009. Downtown has the lowest vacancy rate, at 6.9%, down from 9.2% the prior year. The northeast quadrant continues to have the highest vacancy rate at 24.58%, down from 25%. The southwest quadrant vacancy rate increased to 15.45% from 14.8%. The Class A vacancy rate remains low at 9.11%. Meanwhile, the Class B vacancy rate increased slightly to 14.07%, while the Class C vacancy rate stood at 42.31%. There are currently ten office buildings containing a minimum of 30,000 sq. ft. of vacancy and eight are in the suburban market. The high vacancy in the northeast quadrant continues to negatively impact the overall market. Downtown will continue to be a desired location for office users. New downtown office space will become available with the completion of the Skyline Tower and the renovation of the Fifth Third Metro Center. Downtown development will continue, including the previously-announced project for The Landing and the Electric Works Campus. More vacant space will hit the market in the suburbs in 2018 due to the SIRVA relocation, the previously announced Harris Corporation downsizing and the closing of Brown Mackie College. Rents are increasing downtown, especially for Class A space, with rates exceeding $20.00 per sq. ft. full service plus parking. Rents are stabilizing for Class B and Class C space, especially in suburban buildings. Space utilization per employee is leveling off or increasing as employers compete for talent. Building amenities are increasingly important for attraction/retention such as dining options, fitness centers, walking paths and collaboration spaces. Steven K. Zacher, SIOR, CCIM Alfred J. Zacher, SIOR Joy Neuenschwander, CPM John M. Adams, CCIM Brian Bean Fletcher Moppert Dan Reese Evan Rubin Dave Kaverman FOR MORE INFORMATION PLEASE CONTACT: THE ZACHER COMPANY 444 EAST MAIN STREET, SUITE 203, FORT WAYNE, IN PHONE: (260) INFO@ZACHERCO.COM PUBLISHED: OCTOBER 5, 2017

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4 Contiguous Vacancies Over 30,000 Sq. Ft. The Zacher Company

5 Average Full Service Lease Rates 2017 Notable Fort Wayne Office Transactions The Zacher Company

6 Methodology: The Zacher Company office market survey report is a compilation of data from many sources. The total amount of square footage in the marketplace area was originally gleaned from reports prepared by LoopNet, ICREX and CoStar. It is reviewed annually and adjusted due to circumstances in the market, such as new construction, re-positioning of existing buildings to another type of use and demolition. It includes office buildings only and does not include offices attached to industrial properties or flex space. The vacancy square footage is compiled from a combination of online data from multiple major listing services, brokers listing information from their websites and their mailings and industry knowledge. The survey includes space projected to be occupied or vacant in the fourth quarter It does not include announced office expansions, contractions or construction anticipated after January New construction is added to the inventory upon delivery of the space, during the reporting period. Available space also includes office spaces available for sub-lease. The brokers in our office are involved in the creation of this report to provide the most accurate information possible. We cannot be responsible, however, for errors, omissions, prior sale or lease or withdrawal from the market. The Zacher Company