Industrial Real Estate Portfolio

Industrial Real Estate Portfolio

Portfolio Coverage Page 7

6565 Echo Avenue, Reno, NV Property Summary Address: Size (SF): Office Finish: HVAC Space: Year Built: 2003 Site Area: 6565 Echo Avenue Reno, NV 404,450 square feet 5.14% - 20,800 SF 404,450 SF 26.55 Acres Parking: 234 parking spaces (0.58: 1,000) Clear Height: 24 Construction Overview: HVAC System: Zoning: Concrete Tilt-Up Packaged System throughout the building Current - I, Industrial/Legal Conforming Use Page 17

6565 Echo Avenue, Reno, NV Location Overview Reno is strategically located at the epicenter of the western United States, providing a convenient point of distribution for truck, rail, and air services. Reno s location allows for overnight delivery to over 53 million people and two-day delivery to over 63 million people via truck and rail freight shipping. Additionally, the subject property is located adjacent to the Reno Stead Airport which serves as a reliever airport for Reno-Tahoe International Airport. The GM Distribution facility, located at 6565 Echo Avenue, benefits from its strategic location off 96% 94% 90% 88% 86% 84% $3.46 North Valley Industrial Submarket Historical Occupancy and Rental Rates $3.53 $3.33 $3.05 $3.40 $4.00 $4.21 $4.11 $4.14 $4.07 $4.50 $4.30 $4.10 $3.90 $3.70 $3.50 $3.30 $3.10 of U.S. Route 395 (US-395) which is a major thoroughfare running north/south from Hesperia, CA 82% $2.90 to the US-Canada border near Laurier, WA. Additionally, the property s location is less than 13 80% $2.70 miles from Interstate 80, which is the second longest Interstate Highway in the United States connecting the East and West Coasts providing the main direct access route between some of 78% 2009 2010 2011 2012 2013 2014 1Q2015 2Q2015 3Q2015 4Q2015 $2.50 the nation s largest markets including San Francisco, Chicago and New York, among others. Occupancy Average Rental Rates Industrial Market Overview The Property is located within the Reno Industrial market which is comprised of 1,582 industrial buildings and 81.6 million square feet. More specifically, the GM Distribution facility is located within the North Valley Industrial submarket which is made up of 16.3 million square feet of warehouse space and is currently 91.2% occupied, which is outperforming the overall Reno market of 90.8%. The North Valley Industrial submarket absorbed over 1.3 million square feet of warehouse space in 2015 which accounted for over 65% of the absorption in the entire Reno Industrial market. Rental rates within the North Valley Industrial market are $4.07 PSF as of yearend 2015. This represents a rental rate increase of 32.1% since 4 th quarter 2012. Industrial warehouses greater than 250,000 square feet are currently 93.8% occupied within the North Valley Industrial Submarket. These properties command an average rental rate of $4.16 PSF and have also experienced 1.6 million square feet of absorption in 2015. North Valley Industrial Submarket* # of Industrial Buildings 21 Market Size (SF) 10,170,093 Occupancy 93.8% 2015 Net Absorption (SF) 1,602,274 2016 In-Place Rental Rate $4.11 Competitive Set Rental Rate** $4.52 Discount to Competitive Rental Rate 10.0% 95% of Estimated FMV Rent $4.29 Discount to Estimated FMV Rental Rate 4.5% *CoStar search includes industrial buildings above 250,000 square feet in the North Valley Industrial Submarket **Competitive Set Rental Rates based on applicable lease comparables in Reno market. For further details, please refer to the individual Lease Comparables. Page 18

9150 Hermosa Avenue, Rancho Cucamonga, CA Property Summary Address: Size (SF): Office Finish: HVAC Space: Year Built: 2002 Site Area: 9150 Hermosa Avenue Rancho Cucamonga, CA 405,970 square feet 5.41% - 21,870 SF 405,970 SF 19.23 Acres Parking: 213 parking spaces (0.52: 1,000) Clear Height: 24 Construction Overview: HVAC System: Zoning: Concrete Tilt-Up Packaged System throughout the building Current - G1, General Industrial/ Legal Conforming Use Page 24

9150 Hermosa Avenue, Rancho Cucamonga, CA Location Overview 98% Airport Area Submarket Historical Occupancy and Rental Rates The Property is located within the City of Rancho Cucamonga in San Bernardino County, which is approximately 35 miles east of downtown Los Angeles and is considered part of the Inland Empire West region. The metropolitan area consists of Riverside County and San Bernardino County and, according to the US Census, is home to over 4 million people and is the 13th most 97% 96% 95% $4.91 $5.02 $5.07 $5.20 $5.30 $5.60 $5.40 $5.20 $5.00 populous metropolitan area in the United States and the third largest in the state of California. The Inland Empire most commonly is used in reference to the U.S. Census Bureau's federallydefined Riverside-San Bernardino-Ontario metropolitan area, which covers more than 27,000 94% 93% $4.51 $4.63 $4.74 $4.80 $4.60 $4.40 square miles. While historically the Inland Empire was an agricultural region replete with citrus groves and dairy farms, it has evolved over the past several decades into a dynamic region of Southern California that benefit from its geography relative to its neighboring counties and 91% 2011 2012 2013 2014 1Q2015 2Q2015 3Q2015 4Q2015 $4.20 $4.00 proximity to the ports of Los Angeles and Long Beach. Occupancy Average Rental Rates Industrial Market Overview The Property is located in the Inland Empire Industrial Market which is one of the most sought after industrial markets in the country. Inland Empire consists of 541 million square feet of warehouse space that has an impressive 4.9% vacancy rate as of year-end 2015. The Inland Empire led the nation in absorption in 2015 with over 21 million square feet of positive absorption. Since 2013, Inland Empire has retained a sub 6% vacancy factor, absorbed over 58.8 million square feet of warehouse space and warehouse rental rates have increased 11.3% to $5.54 PSF. 9150 Hermosa Avenue is more specifically located within the Airport Area Industrial Submarket which is comprised of 194.7 million square feet of warehouse space. The Airport Area Submarket experienced 10.3 million square feet of absorption (49% of the overall Inland Empire Industrial market) in 2015 and has a vacancy factor of 3.0%. Average rental rates in the Airport Area are $5.30 PSF which equate to an increase of 17.3% since 4 th quarter 2011. Airport Area Industrial Submarket* # of Industrial Buildings 2,956 Market Size (SF) 194,772,839 Occupancy 97.0% 2015 Net Absorption (SF) 10,383,967 2016 In-Place Rental Rate $4.75 Competitive Set Rental Rate** $5.24 Discount to Market Rental Rate 10.3% 95% of Estimated FMV Rent $4.98 Discount to Estimated FMV Rental Rate 4.8% *Market rental rate is comprised from the average rental rate in the Airport Area Industrial Submarket **Competitive Set Rental Rates based on applicable lease comparables in Rancho Cucamonga market. For further details, please refer to the individual Lease Comparables. Page 25

23400 Smith Road, Aurora, CO Property Summary Address: Size (SF): Office Finish: HVAC Space: Year Built: 2003 Site Area: 23400 Smith Road Aurora, CO 404,800 square feet 5.09% - 20,614 SF 404,800 SF 23.17 Acres Parking: 187 parking spaces (0.46: 1,000) Clear Height: 24 Construction Overview: HVAC System: Zoning: Concrete Packaged System throughout the building Current - E-470 Light Industrial/Legal Conforming Use Page 31

23400 Smith Road, Aurora, CO Location Overview Located just east of Denver, Aurora is one of the principal cities of the Denver-Aurora- Broomfield MSA, which is commonly referred to as Metro Denver. Aurora has grown to a city of 154 square miles with a population of approximately 340,000 people. With an annual growth rate of 1.34%, the city is the 56th largest city in the United States. Aurora functions as one of the metro areas most strategic transportation hubs; with access to multiple interstate highways, highly efficient airports, two major rail lines and an expanding mass transit network. Industrial Market Overview 23400 Smith Road is positioned strategically within the East I-70/Montbello Industrial Submarket which is made up of 1,311 warehouse buildings totaling 73.8 million square feet. The East I- 70/Montbello market is the largest industrial submarket within the Denver Industrial market making up over 30% of the entire market. In 2015, the submarket experienced over 1.2 million square feet of positive absorption while the entire Denver industrial market experience positive absorption of only 603,550. The East I-70/Montbello warehouse market is 96.4% occupied as of year-end 2015 and average rental rates are $5.81 PSF which is an increase of 55% since 4 th quarter 2011. Average rental rate of warehouse buildings greater than 300,000 square feet within the East I- 70/Montbello Industrial Submarket are $4.75. These buildings have seen an increase in rental rate of 47% since 4 th quarter 2013. 97% 96% 95% 94% 93% 91% 90% 89% 88% 87% $3.75 East I-70/Montbello Submarket Historical Occupancy and Rental Rates $3.88 $4.10 $5.24 $5.73 $5.72 $5.91 $5.81 2011 2012 2013 2014 1Q2015 2Q2015 3Q2015 4Q2015 Occupancy Average Rental Rates East I-70/Montbello Industrial Submarket* # of Industrial Buildings 1,311 Market Size (SF) 73,865,167 Occupancy 96.4% 2015 Net Absorption (SF) 1,213,307 2016 In-Place Rental Rate $4.54 Competitive Set Rental Rate** $5.59 Discount to Market Rental Rate 23.1% $7.00 $6.50 $6.00 $5.50 $5.00 $4.50 $4.00 $3.50 $3.00 95% of Estimated FMV Rent $5.31 Discount to Estimated FMV Rental Rate 17.0% *Market rental rate is comprised from the average rental rate of warehouse buildings greater than 300,000 square feet in the East I- 70/Montbello Submarket **Competitive Set Rental Rates based on applicable lease comparables in Aurora market. For further details, please refer to the individual Lease Comparables. Page 32

1355 Remington Road, Bolingbrook, IL Property Summary Address: Size (SF): Office Finish: HVAC Space: Year Built: 2001 Site Area: 1355 Remington Road Bolingbrook, IL 404,473 square feet 5.06% - 20,473 SF 404,473 SF 23.89 Acres Parking: 225 parking spaces (0.57: 1,000) Clear Height: 24 Construction Overview: HVAC System: Zoning: Concrete/Glass Packaged System throughout the building Current - I-1LimitedIndustrial/Legal Conforming Use Page 38

1355 Remington Road, Bolingbrook, IL Location Overview 94% South I-55 Industrial Submarket Historical Occupancy and Rental Rates $5.50 1355 Remington Road is located in the Village of Bolingbrook which is considered a southwest suburban community of Chicago. Bolingbrook is situated in northeast Will County, about 28 miles southwest of the Chicago Central Business District. Nearby communities include Naperville and Woodridge to the north and Romeoville to the south. Bolingbrook is located in one of America s fastest-growing counties because of its strategic location, superior transportation infrastructure, skilled labor force and high quality of life. 94% 93% 93% $4.16 $4.23 $4.55 $4.80 $5.06 $5.15 $4.96 $5.10 $5.30 $5.10 $4.90 $4.70 $4.50 $4.30 $4.10 The Village of Bolingbrook is a premier industrial location because of its exceptional access to the region s transportation infrastructure. Located off I-55, the Property enjoys easy access to I- 355, I-294, I-88, and I-90. Bolingbrook is also an industrial location of choice because of the 91% 91% 2011 2012 2013 2014 1Q2015 2Q2015 3Q2015 4Q2015 $3.90 $3.70 $3.50 Village s proximity and access to Chicago s stable and diverse workforce. Occupancy Average Rental Rates Industrial Market Overview The Property is located in the South I-55 Corridor industrial submarket which is located southwest of Chicago. Totaling approximately 81.1 million square feet of industrial warehouse space, the South I-55 Corridor is the third largest industrial concentrations in the Chicago marketplace. Over the past decade, the South I-55 Corridor submarket has experienced more positive space absorption than any other Chicago submarket. Currently 92.8% occupied, the submarket boasts average asking rental rates of $5.10 per square foot per year. Industrial warehouses greater than 400,000 square feet in the South I-55 submarket are currently 96.3% occupied. These properties command an average rental rate of $3.95 PSF and experienced over 1.1 million square feet of absorption in 2015. South I-55 Industrial Submarket* # of Industrial Buildings 57 Market Size (SF) 32,877,380 Occupancy 96.3% 2015 Net Absorption (SF) 1,169,248 2016 In-Place Rental Rate $3.69 Competitive Set Rental Rate** $4.55 Discount to Market Rental Rate 23.3% 95% of Estimated FMV Rent $4.32 Discount to Estimated FMV Rental Rate 17.1% *CoStar search includes industrial buildings above 400,000 square feet in the South I-55 Industrial Submarket **Competitive Set Rental Rates based on applicable lease comparables in Bolingbrook market. For further details, please refer to the individual Lease Comparables. Page 39

10815 Quality Drive, Charlotte, NC Location Overview Charlotte, North Carolina, is one of the fastest growing metropolitan areas in the country and one of the premier industrial markets in the Southeast. Centrally located along the eastern seaboard, Charlotte possesses access to 60% of the country s population within a one day drive, as a result of its immediate access to I-77, I-40 and I-85, the industrial backbone of the 93% 91% 90% 89% Charlotte Industrial Market Historical Occupancy and Rental Rates $3.35 $3.31 $3.38 $3.42 $3.45 $3.50 $3.54 $3.70 $3.60 $3.50 $3.40 Southeast. The Charlotte region continues to exhibit some of the strongest fundamentals in the 88% $3.25 $3.30 country, and is poised for continued growth behind a diversified economy based around 87% $3.20 banking, energy, and manufacturing. 86% $3.10 10815 Quality Drive is strategically positioned adjacent to some of Charlotte s major thoroughfares including Interstate 485 to the east, Interstate 77 to the south and Interstate 85 to the north. Industrial Market Overview The Charlotte industrial market is one of the premier industrial markets in the southeast, offering excellent accessibility, a skilled workforce, a low cost of operation and a pro-business government. Charlotte s warehouse inventory is comprised of 6,666 buildings that total approximately 285.5 million square feet of total warehouse space. In the last 12 months, the market exhibited strong demand, posting over 3.37 million square feet of positive net absorption. This level of activity comes on the heels of a strong 2014, where positive net absorption totaled nearly 8 million square feet. Correspondingly, the vacancy rate for industrial space in Charlotte has continued a steady decline from a high of 13.3 percent in the fourth quarter of 2010, to 7.5 percent at the end of 2015. The Property is located within the State Line Industrial Submarket which is comprised of 39 million square feet of warehouse space and is 94.5% occupied. More specifically, warehouses larger than 300,000 square within this submarket are 95.2% occupied and have experience a rental rate increase of 23.6% since 4 th quarter 2013. 85% 2011 2012 2013 2014 1Q2015 2Q2015 3Q2015 4Q2015 Occupancy Average Rental Rates State Line Industrial Submarket* # of Industrial Buildings 17 Market Size (SF) 8,964,861 Occupancy 95.2% 2015 Net Absorption (SF) 310,960 2016 In-Place Rental Rate $3.95 Competitive Set Rental Rate** $4.51 Discount to Market Rental Rate 14.2% 95% of Estimated FMV Rent $4.28 Discount to Estimated FMV Rental Rate 8.5% *CoStar search includes industrial buildings above 300,000 square feet in the State Line Industrial Submarket **Competitive Set Rental Rates based on applicable lease comparables in Charlotte market. For further details, please refer to the individual Lease Comparables. $3.00 Page 46