Market Overview TAMPA BAY OFFICE THIRD QUARTER

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1 Market Overview TAMPA BAY OFFICE THIRD QUARTER 29

2 COLLIERS ARNOLD TAMPA BAY Insights on the Market OFFICE THIRD QUARTER 29 MARKET INDICATORS TAMPA BAY INVENTORY 8,58,612 Sq. Ft. Q3 Q4* OVERALL VACANCY DIRECT VACANCY ABSORPTION CONSTRUCTION NEW SUPPLY 15.2% 14.2% (329,578) s.f. 183,871 s.f. 25,622 s.f. OVERALL DIRECT AVG ASKING RATE $2.72 CLASS A DIRECT AVG ASKING RATE $24.51 *Projected, relative to prior period Note: Directional arrows compare current quarter to previous quarter historically adjusted figures. The Tenant Market Continues The third quarter office real estate market continued to reflect the sluggish conditions witnessed throughout the start of 29. As predicted, the downtrend continued with increasing vacancies and negative absorption for office space. These trends have created an advantageous environment in the tenant market with landlords driven to make various concessions to attract tenants. The increase in tenant activity observed in the leasing market during the third quarter is a direct result of these incentives. Although absorption rates were negative, they have increased from the previous two quarters. Also demonstrating the first signs of balance is a positive net absorption within the I-75 Corridor submarket. Activity in the market, such as this, reveals the market downtrend is slowing. During the third quarter, the bottom continued to be redefined but with rates diminishing at a slower pace the market is showing small signs of leveling out. While sales activity continued to be soft, the Tampa Bay office market has experienced the most activity within the leasing segment, therefore this area may continue to lead the way to stabilization. The pressure of increased vacancy has again forced rental rates downward with an overall direct asking rate of $2.72 compared to last quarter s $21.6. With the new standard of copious concession coupled with lower rental rates, an increase of activity in the tenant market is anticipated to occur. Office landlords who reduce rates and provide incentives, are going to see the deals, said Mary Clare Codd, Director of Office and Industrial Services who experienced an increase in lease closing from earlier this year. As the overall economy stretches to show signs of recovery, the commercial real estate market remains lagging behind. It is an opportunistic time for tenants looking to renew, move or upgrade as the Tampa Bay office market continues to trudge along the bottom with only slight signs of stabilization on the horizon. The lack of overbuilding in Tampa Bay, with only 25,633 square feet of office space delivered to the market this quarter, coupled with discounted rental rates will help facilitate the stabilization. In the quarters to come the trend lines are predicted to level out paving the way for a much anticipated recovery in the latter part of 21. Trends It is an opportunistic time for tenants to renew, move or upgrade space. Tenant activity within the leasing market has increased during the third quarter due to various incentives being offered by landlords. Sales activity remains slow with no definite signs of growth in transactions. Construction activity will remain slow over the coming quarters until vacancy and rental rates stabilize. TAMPA BAY OFFICE SERVICE GROUP Jim Allen David Box, MCR Claire Calzon jallen@colliersarnold.com dbox@colliersarnold.com ccalzon@colliersarnold.com Mary Clare Codd, SIOR Alan Feldshue John Gerlach, CCIM mcodd@colliersarnold.com afeldshue@colliersarnold.com jgerlach@colliersarnold.com Melanie Jackson Christopher Leonard, CCIM Josh Pardue mjackson@colliersarnold.com cleonard@colliersarnold.com jpardue@colliersarnold.com Camille Renshaw, CCIM James Stuckey, MCR Jeff Tolrud, CCIM crenshaw@colliersarnold.com jstuckey@colliersarnold.com jtolrud@colliersarnold.com James Ullrich, CPA Carol Warren, CCIM jullrich@colliersarnold.com cwarren@colliersarnold.com COLLIERS ARNOLD 1

3 29 THIRD QUARTER REPORT OFFICE TAMPA BAY OVERALL OFFICE MARKET STATISTICS RENTAL RATES BY BUILDING CLASS Completions Overall Net Absorption Class A 6 $3. Overall Avg. Lease Rate Class A Avg. Lease Rate 12.8% 13.4% % 15.2% (1) (2) (3) (4) Asking Rates $25. $2. $15. $1. $5. % Q3 '8 Q4 '8 Q1 '9 Q2 '9 Q3 '9 (5) $. Q3 '8 Q4 '8 Q1 '9 Q2 '9 Q3 '9 FLORIDA CONSUMER CONFIDENCE INDEX NATIONAL GDP Consumer Confidence Index Consumer Confidence Index Benchmark Level Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May. Jun. July. Aug. Sept Month and Year Percent Change (2.) (4.) (6.) (8.) National GDP (.7) (.7) (2.7) (5.4) (6.4) Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Quarter & Year UNEMPLOYMENT SNAPSHOT Unemployment Rate Unemployment Rate (%) Sep-4 Florida Tampa MSA USA Mar-5 Sep-5 Mar-6 Sep-6 Mar-7 Sep-7 Mar-8 Sep-8 Mar-9 Sep-9 The unemployment rate for the Tampa Bay MSA was 11.7% for September 29. This compares to the year ago rate of 7.2% for September 28. The State of Florida rate was 11.2% for September 29 which compares to 6.9 % for September 28. Both the local and state rates are higher than the national rate which now stands at 9.5%. The national rate in September 28 was 6.%. The detailed snapshot for the Tampa Bay area shows a net loss of 73,566 jobs from September 28 to September 29. All reported rates are non-seasonally adjusted 2 COLLIERS ARNOLD

4 TAMPA BAY OFFICE THIRD QUARTER REPORT 29 SUBMARKET TRENDS TAMPA CBD WESTSHORE ST. PETERSBURG CBD Completions Net Absorption Overall 4 Completions Net Absorption Overall 21% 4 Completions Net Absorption Overall 1 4 % Q3 '8 Q4 '8Q1 '9 Q2 '9 Q3 '9 2 (2) (4) (6) (8) % Q3 '8Q4 '8Q1 '9Q2 '9Q3 ' (1) (2) (3) 8% 4% % Q3 '8Q4 '8Q1 '9Q2 '9Q3 '9 2 (2) (4) (6) (8) (1) GATEWAY I-75 CORRIDOR NORTH PINELLAS Completions Net Absorption Overall (2) 8% (4) (6) 4% (8) % (1) Q3 '8Q4 '8Q1 '9Q2 '9Q3 '9 Completions Net Absorption Overall (5) % (1) Q3 '8Q4 '8Q1 '9Q2 '9Q3 '9 Completions Net Absorption Overall (2) (4) (6) (8) % (1) Q3 '8Q4 '8Q1 '9Q2 '9Q3 '9 SUBMARKET OVERVIEW rates increased within the majority of the submarkets during the third quarter but gave way within the I-75 Corridor submarket. The current average vacancy rate within the submarket is 14.7 percent, down slightly from 15. percent in the previous quarter. Tenant demand and lease executions in the I-75 Corridor submarket increased during the quarter pushing net absorption to a positive 45,237 square feet. The Gateway submarket has experienced near stable conditions over the past year as evidence by the minimal fluctuations in vacancy. Net absorption registered a negative 13,72 square feet causing vacancy to tick upward to 13.4 percent from 13.3 percent in the previous quarter. The average asking rental rate decreased to $2.5 per square foot from $2.69 in the previous quarter. Construction activity remains low with just over 18, square feet of space under construction in the overall Tampa Bay market. The I-75 Corridor submarket currently has one building under construction totaling 88, square feet. North Pinellas is currently experiencing two buildings under construction with a combined square footage of 3,871. The St. Petersburg CBD currently has one 45, square foot building under construction. The average asking rental rate throughout all submarkets experienced a decline compared to the previous quarter. The Westshore submarket is asking the highest rents on average at $24.79 per square foot full service. Class A space within the submarket is currently being offered at an average of $27.96 per square foot. COLLIERS ARNOLD 3

5 29 THIRD QUARTER REPORT OFFICE TAMPA BAY TAMPA BAY MARKET STATISTICS Net Total Direct Total Absorp. Net New Under Sbmrkt & Inventory Vac. Vac. Current Absorp. Completions Construc. Avg. Direct Asking Rate Bldg Type Bldgs. S.F. % % Qtr. S.F. YTD S.F. S.F. S.F. Full Service HIGHLIGHTED OFFICE SUBMARKETS Tampa CBD A 13 4,839, % 18.5% -23,594-13,31 $23.53/fs B, C 76 4,476, % 11.5% -8,265-3,66 $17.24/fs Overall 89 9,315, % ,859-16,916 $2.95/fs Westshore A 38 7,449, % 23.2% -23, ,631 $27.96/fs B, C 199 8,45, % ,73-296,299 $21.24/fs Overall ,494, ,1-537,93 $24.79/fs I-75 Corridor A 44 6,897, % 14.7% -1,423 76,458 88, $23.22/fs B, C 259 8,822, % ,66 137,259 $18.7/fs Overall 33 15,72, % 14.7% 45, ,717 88, $2.57/fs North Pinellas A 12 1,11, % ,193-45,76 $19.93/fs B, C 16 4,146, % 14.8% 1,489-88,535 3,871 $18.49/fs Overall 172 5,247, % ,74-134,241 3,871 $18.86/fs Gateway A 25 3,383,88 9.1% 1.7% 29,146-88,315 $22.82/fs B, C 113 4,467, ,218 29,18 $18.88/fs Overall 138 7,85, % 13.4% -13,72-59,297 $2.5/fs St. Petersburg CBD A 8 1,628, % 22.4% -81,53-95,56 45, $25.28/fs B, C 59 2,297, % 9.4% -2,683-36,719 $2.29/fs Overall 67 3,926, % 14.8% -83, ,225 45, $23.76/fs Qtr. & Year Bldgs. Total Inventory S.F. Direct Vac. % Total Vac. % TAMPA BAY OVERALL OFFICE MARKET Net Absorp. Current Qtr. S.F. Net Absorp. YTD S.F. New Completions S.F. Under Construc. S.F. Overall Avg. Direct Asking Rate F.S. Class A Avg. Direct Asking Rate F.S. 29 3Q 1,762 8,58, % 15.2% -329,578-1,116,269 25, ,871 $2.72 $ Q 1,761 8,554, % -348, ,691 55, 189,533 $21.6 $ Q 1,757 8,499, , , ,34 213,662 $21.1 $ Q 1,755 8,232, % 13.4% -88,52-657, ,892 41,34 $2.97 $ Q 1,749 79,751, % -287, ,849 24,4 891,232 $2.97 $ Q 1,744 79,436, % -85,976-28, ,197 1,169,296 $21.5 $ Q 1,739 79,293, % -194,88-194,88 617,936 1,26,3 $21.33 $ Q 1,728 78,754, % 11.% 12, , ,256 1,694,996 $21.26 $ Q 1,711 78,333, % 1.5% -16,92 26, ,449 1,662,224 $21.19 $ COLLIERS ARNOLD

6 TAMPA BAY OFFICE THIRD QUARTER REPORT 29 TAMPA BAY OFFICE HIGHLIGHTED SUBMARKETS COLLIERS ARNOLD 4 OFFICES THROUGHOUT FLORIDA TAMPA (813) ORLANDO (47) CLEARWATER (727) FT MYERS (239) OUR SERVICES: BROKERAGE SALES & LEASING TENANT REPRESENTATION PROPERTY MANAGEMENT VALUATION & ADVISORY CONSTRUCTION MANAGEMENT RECEIVERSHIPS RESEARCH & GIS COLLIERS INTERNATIONAL OFFICES IN 61 COUNTRIES ON 6 CONTINENTS USA 94 CANADA 22 LATIN AMERICA 17 THIRD QUARTER 29 TRANSACTION HIGHLIGHTS ASIA PACIFIC 64 EMEA 97 SALES ACTIVITY BLDG NAME/ PROPERTY ADDRESS N Telecom Pkwy North Port Medical Plaza Unit Bobcat Village Cntr Rd. City Place Condos 157 City Place Condos LEASING ACTIVITY BLDG NAME/ PROPERTY ADDRESS Thompson Center Waters 5481 W Waters Ave. Park Place 311 Park Place Blvd PROPERTY CLASS B A B PROPERTY CLASS BUYER NAME Lepanto Realty Corp. Sarasota County Public Hospital Board Cagmill Properties Inc. TENANT NAME SIZE (SF) SALES PRICE SALES PRICE/SF 133,92 $1,9, $81.39 SUB- MARKET Northwest Tampa 24,688 $5,376,5 $ Sarasota 6,486 $895, SIZE (SF) $ South Tampa LEASE TYPE SUB- MARKET B Mercantile Credit 21,916 New/Direct East Tampa A Senior Home Care New/Direct Bayside This Colliers Arnold market report includes owner and non-owner occupied office space 1, s.f. and greater in Hillsborough and Pinellas Counties. Directional arrows compare current quarter numbers to previous quarter numbers. Arrows show change when there is a 1 cent or more change in lease rate or.5% or more change in vacancy rate. Due to continual updates and refinements in the historical database, some of the data in this report may not match data published in previous reports. Sources: CoStar Property and Colliers Arnold. Colliers Arnold is a member firm of Colliers International - a worldwide affiliation of independently owned and operated companies with over 294 offices throughout more than 61 countries. Questions should be directed to Colliers Arnold Research at 813/ or research@colliersarnold.com. Report written by Daniel Rice, or HUdrice@colliersarnold.comUH. Information contained herein has been obtained from sources deemed reliable but not guaranteed. No representation is made as to the accuracy thereof. Data as of 1/1/9. COLLIERS ARNOLD SERVICES PROPERTY MANAGEMENT Kimberly Lamb, CPM klamb@colliersarnold.com VALUATION & CONSULTING Ron Sparks, MAI, MBA rsparks@colliersarnold.com GIS & RESEARCH Matthew Dolan mdolan@colliersarnold.com Daniel Rice drice@colliersarnold.com Pinebrooke Business Park B Gallo Building Services 7,9 New/Direct East Tampa MARKETING Tower Place Renewal/ A AvMed 7,578 Westshore Elizabeth Cross 1511 N Westshore Blvd Expansion ecross@colliersarnold.com Franklin Templeton A Conifer Health 2,96 New/Direct St. Pete 14 Fountain Pkwy Highland Oaks A Greystone Healthcare 23,511 New/Direct East Tampa 115 Highland Manor Dr FOR OTHER LOCAL REPORTS VISIT FOR NATIONAL REPORTS VISIT COLLIERS ARNOLD 5

7 Our Service Groups Get Deals Done