The CoStar Office Report

The CoStar Office Report F I R S T Q U A R T E R 2 0 1 0 New York Outer Boroughs Office Market

New York Outer Boroughs Office Market FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS Table of Contents Table of Contents.................................................................... A Methodology........................................................................ B Terms & Definitions.................................................................. C Market Highlights & Overview......................................................... 1 CoStar Markets & Submarkets......................................................... 4 Employment & Tenant Analysis........................................................ 5 Employment & Unemployment Analysis Tenant Profiles Inventory & Development Analysis Select Top Deliveries Select Top Under Construction Properties Figures at a Glance.................................................................. 11 Figures at a Glance by Class & Market Figures at a Glance by Class & Submarket Historical Figures at a Glance Leasing Activity Analysis Select Top Lease Transactions Sales Activity Analysis............................................................... 16 Sales Activity Analysis Select Top Sales Transactions Select Same Building Sales Select Land Sales Analysis of Individual CoStar Markets.................................................. 19 Brooklyn Market Queens Market Staten Island Market 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT A

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market Methodology The CoStar Office Report, unless specifically stated otherwise, calculates office statistics using CoStar Group s entire database of existing and under construction office buildings in each metropolitan area. Included are office, office condominium, office loft, office medical, all classes and all sizes, and both multi-tenant and single-tenant buildings, including owner-occupied buildings. CoStar Group's national database includes approximately 69.1 billion square feet of coverage in 2.8 million properties. All rental rates reported in the CoStar Office Report have been converted to a Full Service equivalent rental rate. For information on subscribing to CoStar s other products and services, please contact us at 1-877-7COSTAR, or visit our web site at www.costar.com Copyright 2010 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. 2 Bethesda Metro Center Bethesda, MD USA 20814 (800) 204-5960 www.costar.com NASDAQ: CSGP B THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS 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-of-a-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 buildingtype 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) 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT C

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market 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 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: The status of a building that is in the process of being developed, assembled, built or constructed. A building is considered to be under construction after it has begun construction and until it receives a certificate of occupancy. Vacancy 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 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market OVERVIEW FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS New York Outer Boroughs s Vacancy Falls to 6.1% Net Absorption Positive 250,696 SF in the Quarter The New York Outer Boroughs Office market ended the first quarter 2010 with a vacancy rate of 6.1%. The vacancy rate was down over the previous quarter, with net absorption totaling positive 250,696 square feet in the first quarter. Vacant sublease space increased in the quarter, ending the quarter at 235,544 square feet. Rental rates ended the first quarter at $25.52, an increase over the previous quarter. A total of two buildings delivered to the market in the quarter totaling 17,000 square feet, with 891,796 square feet still under construction at the end of the quarter. Absorption Net absorption for the overall New York Outer Boroughs office market was positive 250,696 square feet in the first quarter 2010. That compares to positive 351,720 square feet in the fourth quarter 2009, positive 264,082 square feet in the third quarter 2009, and positive 412,034 square feet in the second quarter 2009. Tenants moving out of large blocks of space in 2010 include: New York State Division of Parole moving out of 17,500 square feet at 350 Livingston St; Edit.com moving out of 3,387 square feet at 45 Main St; and Dr Qi Jiang moving out of 3,200 square feet at Medical Arts Center. Tenants moving into large blocks of space in 2010 include: NYC Housing Authority moving into 62,400 square feet at Brooklyn Office Exchange; Comprehensive Care Management moving into 26,000 square feet at 136-65 37th Ave; and Fidelis Care New York moving into 24,867 square feet at Queens Office Tower. The Class-A office market recorded net absorption of positive 99,540 square feet in the first quarter 2010, compared to positive 191,796 square feet in the fourth quarter 2009, positive 117,895 in the third quarter 2009, and negative (16,236) in the second quarter 2009. The Class-B office market recorded net absorption of positive 141,003 square feet in the first quarter 2010, compared to positive 70,158 square feet in the fourth quarter 2009, positive 84,324 in the third quarter 2009, and positive 73,746 in the second quarter 2009. The Class-C office market recorded net absorption of positive 10,153 square feet in the first quarter 2010 compared to positive 89,766 square feet in the fourth quarter 2009, positive 61,863 in the third quarter 2009, and positive 354,524 in the second quarter 2009. Vacancy The office vacancy rate in the New York Outer Boroughs market area decreased to 6.1% at the end of the first quarter 2010. The vacancy rate was 6.5% at the end of the fourth quarter 2009, 6.9% at the end of the third quarter 2009, and 7.2% at the end of the second quarter 2009. Class-A projects reported a vacancy rate of 7.0% at the end of the first quarter 2010, 7.6% at the end of the fourth quarter 2009, 8.5% at the end of the third quarter 2009, and 9.2% at the end of the second quarter 2009. Class-B projects reported a vacancy rate of 6.6% at the end of the first quarter 2010, 7.0% at the end of the fourth quarter 2009, 7.2% at the end of the third quarter 2009, and 7.2% at the end of the second quarter 2009. Class-C projects reported a vacancy rate of 4.8% at the end Vacancy Rates by Class 1996-2010 A B C Total Market 14% 12% 10% Vacancy Rate 8% 6% 4% 2% 0% 1996 1997 1997 1998 1998 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 2010 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 1

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market OVERVIEW of the first quarter 2010, 4.8% at the end of fourth quarter 2009, 5.3% at the end of the third quarter 2009, and 5.6% at the end of the second quarter 2009. Largest Lease Signings The largest lease signings occurring in 2010 included: the 185,572-square-foot lease signed by Jet Blue Airways at One MetLife Plaza in the Queens market; the 28,000-square-foot deal signed by Block Institute at 133 27th Ave in the Brooklyn market; and the 25,000-square-foot lease signed by MetLife at Corporate Commons II in the Staten Island market. Sublease Vacancy The amount of vacant sublease space in the New York Outer Boroughs market increased to 235,544 square feet by the end of the first quarter 2010, from 235,479 square feet at the end of the fourth quarter 2009. There was 374,674 square feet vacant at the end of the third quarter 2009 and 373,709 square feet at the end of the second quarter 2009. New York Outer Boroughs s Class-A projects reported vacant sublease space of 90,023 square feet at the end of first quarter 2010, down from the 90,358 square feet reported at the end of the fourth quarter 2009. There were 224,353 square feet of sublease space vacant at the end of the third quarter 2009, and 229,137 square feet at the end of the second quarter 2009. Class-B projects reported vacant sublease space of 144,521 square feet at the end of the first quarter 2010, from the 144,521 square feet reported at the end of the fourth quarter 2009. At the end of the third quarter 2009 there were 149,721 square feet, and at the end of the second quarter 2009 there were 143,972 square feet vacant. Class-C projects reported increased vacant sublease space from the fourth quarter 2009 to the first quarter 2010. Sublease vacancy went from 600 square feet to 1,000 square feet during U.S. Vacancy Comparison Past 7 Quarters Vacancy Rate 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Source: CoStar Property New York Outer Boroughs United States 2008 2008 4q 2009 2009 2q 2009 2009 4q 2010 that time. There was 600 square feet at the end of the third quarter 2009, and 600 square feet at the end of the second quarter 2009. Rental Rates The average quoted asking rental rate for available office space, all classes, was $25.52 per square foot per year at the end of the first quarter 2010 in the New York Outer Boroughs market area. This represented a 0.3% increase in quoted rental rates from the end of the fourth quarter 2009, when rents were reported at $25.44 per square foot. The average quoted rate within the Class-A sector was $30.26 at the end of the first quarter 2010, while Class-B rates stood at $26.18, and Class-C rates at $21.17. At the end of the fourth quarter 2009, Class-A rates were $28.72 per square foot, Class-B rates were $26.05, and Class-C rates were $20.74. Deliveries and Construction During the first quarter 2010, two buildings totaling 17,000 square feet were completed in the New York Outer Boroughs market area. This compares to two buildings totaling 69,260 square feet that were completed in the fourth quarter 2009, three buildings totaling 86,972 square feet completed in the third quarter 2009, and 94,161 square feet in six buildings completed in the second quarter 2009. There were 891,796 square feet of office space under construction at the end of the first quarter 2010. Some of the notable 2010 deliveries include: 162-16 Union Tpke, a 10,000-square-foot facility that delivered in first quarter 2010 and 2546 E 17th St, a 7,000-square-foot building that delivered in first quarter 2010 and is now 79% occupied. The largest projects underway at the end of first quarter 2010 were Two Gotham Center, a 662,000-square-foot building and 902 Quentin Rd, a 71,516-square-foot facility. Inventory Total office inventory in the New York Outer Boroughs market area amounted to 66,965,331 square feet in 2,995 buildings as of the end of the first quarter 2010. The Class-A office sector consisted of 16,028,039 square feet in 53 projects. There were 1,216 Class-B buildings totaling 30,823,343 square feet, and the Class-C sector consisted of 20,113,949 square feet in 1,726 buildings. Within the Office market there were 87 owner-occupied buildings accounting for 1,116,862 square feet of office space. Sales Activity Tallying office building sales of 15,000 square feet or larger, New York Outer Boroughs office sales figures rose during the fourth quarter 2009 in terms of dollar volume compared to the third quarter of 2009. In the fourth quarter, two office transactions closed with a total volume of $15,935,775. The two buildings totaled 64,500 square feet and the average price per square foot equated to 2 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market OVERVIEW FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS $247.07 per square foot. That compares to two transactions totaling $9,210,000 in the third quarter 2009. The total square footage in the third quarter was 69,184 square feet for an average price per square foot of $133.12. Total office building sales activity in 2009 was down compared to 2008. In the twelve months of 2009, the market saw eight office sales transactions with a total volume of $46,045,775. The price per square foot averaged $128.43. In the same twelve months of 2008, the market posted 23 transactions with a total volume of $707,670,575. The price per square foot averaged $246.57. Cap rates have been higher in 2009, averaging 6.95% compared to the same period in 2008 when they averaged 5.52%. One of the largest transactions that has occurred within the last four quarters in the New York Outer Boroughs market is the sale of Social Security Administration in Brooklyn. This 30,000- square-foot office building sold for $11,435,775, or $381.19 per square foot. The property sold on 12/29/2009. Absorption & Deliveries Past 7 Quarters Millions SF Net Absorption Deliveries 0.5 0.41 0.4 0.35 0.3 0.26 0.25 0.20 0.2 0.13 0.1 0.08 0.09 0.09 0.09 0.07 0.00 0.02 0.0 (0.1) (0.2) (0.3) (0.27) (0.4) 2008 2008 4q 2009 2009 2q 2009 2009 4q 2010 Source: CoStar Property Reports compiled by: Herbert Rice, CoStar Research Manager. 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 3

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market MARKETS CoStar Markets & Submarkets In analyzing metropolitan areas in the U.S., CoStar has developed geographic designations to help group properties together, called Regions, Markets and Submarkets. Regions 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. Regions are then divided into Markets, 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. Markets Brooklyn Queens Staten Island Submarkets Downtown Brooklyn North Brooklyn South Brooklyn Central Queens Northeast Queens Northwest Queens South Queens Staten Island 4 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market EMPLOYMENT AND TENANT FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS Total Employment by Industry Percent of Total Employment by Industry Total Employment Growth Total Number of Jobs Added Per Year 3% 0% 18% Natural Resources & Mining Construction 3.0% New York Outer Boroughs U.S. Average 4% 16% 8% 4% 15% Manufacturing Trade, Transportation & Utilities Information 11% Financial Activities Professional & Business Services Education & Health Services Leisure & Hospitality Other Services Percent Growth 2.0% 1.0% 0.0% -1.0% -2.0% -3.0% -4.0% 21% Government -5.0% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: Department of Labor, Bureau of Labor Statistics Office* Employment Growth Cumulative Growth in Office* Jobs Over the Past 5 Years Market Employment Growth Inventory Growth Difference Atlanta -8.90% 6.90% -15.80% Boston -3.40% 2.70% -6.10% Chicago -10.20% 4.40% -14.60% Dallas/Ft Worth 1.70% 7.70% -6.00% Denver -3.30% 5.30% -8.60% Los Angeles -10.50% 3.00% -13.50% New York City -3.20% 1.80% -5.00% Seattle/Puget Sound -2.30% 8.40% -10.70% Tampa/St Petersburg -11.00% 8.20% -19.20% Washington -1.70% 9.40% -11.10% New York Outer Boroughs #N/A #N/A #N/A Source: Department of Labor, Bureau of Labor Statistics Historical Unemployment Rates Source: Department of Labor, Bureau of Labor Statistics Office* Employment Growth Number of Office* Jobs Added Per Year Percent Growth 5.0% New York Outer Boroughs U.S. Average 4.0% 3.0% 2.0% 1.0% 0.0% -1.0% -2.0% -3.0% -4.0% -5.0% -6.0% -7.0% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: Department of Labor, Bureau of Labor Statistics. * Office employment is defined as jobs in the Information, Financial Activities, and Professional & Business Services industries 12.0% New York Outer Boroughs U.S. Average 10.0% Percent Unemployment 8.0% 6.0% 4.0% 2.0% 0.0% 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 Source: Department of Labor, Bureau of Labor Statistics. 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 5

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market EMPLOYMENT AND TENANT Tenant by Size Range Based on Total Number of Tenants Tenants by Lease Expiration Based on Total Square Footage of Tenants 75,000 SF & Up 2.4% 2016 3.5% 50,000-74,999 SF 1.3% 2015 3.1% 25,000-49,999 SF 3.1% 2014 9.2% 10,000-24,999 SF 8.3% 2013 4.4% 5,000-9,999 SF 9.6% 2,500-4,999 SF 15.1% 2012 7.8% Up to 2,499 SF 60.3% 2011 10.0% 0% 10% 20% 30% 40% 50% 60% 70% 0% 2% 4% 6% 8% 10% 12% Percentage of Tenants Percentage of Tenants Source: CoStar Tenant Source: CoStar Tenant Tenants by Industry SF Per Employee by Industry Based on Total Square Footage of Tenants Based on All Tenants Services 37.6% Finance/Ins/RE 464.3 Finance/Ins/RE 21.6% Transportation 446.1 Medical 12.8% Engineers/Archit 426.8 Agri/Mining/Util 7.9% Manufacturing 314.2 Transportation 6.3% Government 294.4 Retailers/Wholes 3.9% Law Firms 289.2 Government 2.9% Services 268.7 Manufacturing 2.7% Agri/Mining/Util 251.4 Business-Service 2.3% Accountants 248.7 Engineers/Archit 0.8% Retailers/Wholes 191.9 Law Firms 0.6% Medical 191.4 Communications 0.5% Business-Service 168.5 Accountants 0.0% Communications 61.0 0% 5% 10% 15% 20% 25% 30% 35% 40% 0 100 200 300 400 500 Percentage of Tenants SF Per Employee Source: CoStar Tenant Source: CoStar Tenant 6 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market INVENTORY & DEVELOPMENT FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS Historical Deliveries 1982-2010 3.0 2.5 Deliveries 2.8 2.5 Average Delivered SF Millions of SF 2.0 1.5 1.0 0.5 0.0 1.6 1.6 1.3 1.2 1.2 0.8 0.9 0.8 0.3 0.4 0.4 0.4 0.5 0.6 0.4 0.5 0.5 0.3 0.3 0.1 0.1 0.2 0.2 0.2 0.3 0.2 0.0 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 * Future deliveries based on current under construction buildings. Construction Activity Markets Ranked by Under Construction Square Footage Under Construction Inventory Average Bldg Size Market # Bldgs Total RBA Preleased SF Preleased % All Existing U/C Queens 2 684,000 5,060 0.7% 21,331 342,000 Brooklyn 10 204,357 29,087 14.2% 30,860 20,436 Staten Island 1 3,439 3,439 100.0% 8,838 3,439 Totals 13 891,796 37,586 4.2% 22,359 68,600 Recent Deliveries Leased & Un-Leased SF in Deliveries Since 2006 Future Deliveries Preleased & Un-Leased SF in Properties Scheduled to Deliver 1.4 Leased Un-Leased 700 Preleased Un-Leased 1.2 600 1.0 500 Millions of SF 0.8 0.6 0.4 Thousands of SF 400 300 200 T 0.2 100 0.0 2006 2007 2008 2009 2010 0 2010 2q 2010 2010 4q 2011 4q 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 7

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market INVENTORY & DEVELOPMENT Historical Construction Starts & Deliveries Square Footage Per Quarter Starting and Completing Construction 0.8 0.75 Construction Starts 0.75 Deliveries 0.7 0.6 Millions of SF 0.5 0.4 0.3 0.2 0.1 0.0 0.24 0.19 0.12 0.10 0.09 0.08 0.07 0.08 0.09 0.09 0.07 0.060.07 0.08 0.09 0.05 0.06 0.04 0.06 0.07 0.00 0.02 0.00 0.00 2007 2007 2q 2007 2007 4q 2008 2008 2q 2008 2008 4q 2009 2009 2q 2009 2009 4q 2010 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 2 17,000 5,530 32.5% $17.18 0 17,000 50,000 SF - 99,999 SF 0 0 0 0.0% $0.00 0 0 100,000 SF - 249,999 SF 0 0 0 0.0% $0.00 0 0 250,000 SF - 499,999 SF 0 0 0 0.0% $0.00 0 0 >= 500,000 SF 0 0 0 0.0% $0.00 0 0 Recent Development by Tenancy Existing Inventory Comparison Based on RBA Developed for Single & Multi Tenant Use Based on Total RBA 2010 Deliveries Currently Under Construction By Class By Space Type 0% 1% 30% 12% 24% 100% 99% 46% 88% Multi Single Multi Single Class A Class B Class C Multi Single 8 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market INVENTORY & DEVELOPMENT FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 9

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market INVENTORY & DEVELOPMENT 10 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market FIGURES AT A GLANCE FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS Class A Market Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Brooklyn 20 8,859,676 591,381 681,404 7.7% 49,503 0 101,516 $31.62 Queens 21 6,043,491 161,200 161,200 2.7% 50,037 0 662,000 $35.05 Staten Island 12 1,124,872 279,713 279,713 24.9% 0 0 0 $20.93 Totals 53 16,028,039 1,032,294 1,122,317 7.0% 99,540 0 763,516 $30.26 Class B Market Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Brooklyn 416 15,266,926 1,015,424 1,158,445 7.6% 42,728 7,000 102,841 $27.65 Queens 628 13,581,520 679,943 681,443 5.0% 80,082 10,000 22,000 $24.96 Staten Island 172 1,974,897 189,037 189,037 9.6% 18,193 0 3,439 $23.53 Totals 1,216 30,823,343 1,884,404 2,028,925 6.6% 141,003 17,000 128,280 $26.18 Class C Market Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Brooklyn 696 10,806,887 445,445 446,445 4.1% 15,350 0 0 $21.03 Queens 597 6,953,767 430,397 430,397 6.2% (11,145) 0 0 $21.35 Staten Island 433 2,353,295 86,374 86,374 3.7% 5,948 0 0 $21.24 Totals 1,726 20,113,949 962,216 963,216 4.8% 10,153 0 0 $21.17 Total Office Market Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Brooklyn 1,132 34,933,489 2,052,250 2,286,294 6.5% 107,581 7,000 204,357 $26.83 Queens 1,246 26,578,778 1,271,540 1,273,040 4.8% 118,974 10,000 684,000 $24.45 Staten Island 617 5,453,064 555,124 555,124 10.2% 24,141 0 3,439 $21.85 Totals 2,995 66,965,331 3,878,914 4,114,458 6.1% 250,696 17,000 891,796 $25.52 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 11

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market FIGURES AT A GLANCE Class A Submarket Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Central Queens 3 919,760 61,952 61,952 6.7% 13,096 0 0 $35.35 Downtown Brooklyn 14 8,476,097 561,381 651,404 7.7% 74,503 0 0 $30.90 North Brooklyn 2 123,320 0 0 0.0% 0 0 0 $0.00 Northeast Queens 7 1,119,105 11,810 11,810 1.1% 7,842 0 0 $33.16 Northwest Queens 10 3,744,626 87,438 87,438 2.3% 29,099 0 662,000 $37.56 South Brooklyn 4 260,259 30,000 30,000 11.5% (25,000) 0 101,516 $34.37 South Queens 1 260,000 0 0 0.0% 0 0 0 $26.00 Staten Island 12 1,124,872 279,713 279,713 24.9% 0 0 0 $20.93 Totals 53 16,028,039 1,032,294 1,122,317 7.0% 99,540 0 763,516 $30.26 Class B Submarket Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Central Queens 66 1,324,267 27,278 27,278 2.1% 16,850 0 0 $23.19 Downtown Brooklyn 69 7,996,904 237,066 241,815 3.0% 27,271 0 0 $28.61 North Brooklyn 148 3,358,311 524,368 660,640 19.7% 1,739 0 14,547 $26.24 Northeast Queens 370 5,662,368 208,357 209,857 3.7% 21,642 10,000 0 $30.55 Northwest Queens 102 3,792,940 246,748 246,748 6.5% 1,940 0 22,000 $24.39 South Brooklyn 199 3,911,711 253,990 255,990 6.5% 13,718 7,000 88,294 $27.86 South Queens 90 2,801,945 197,560 197,560 7.1% 39,650 0 0 $21.59 Staten Island 172 1,974,897 189,037 189,037 9.6% 18,193 0 3,439 $23.53 Totals 1,216 30,823,343 1,884,404 2,028,925 6.6% 141,003 17,000 128,280 $26.18 Class C Submarket Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Central Queens 110 1,178,117 33,740 33,740 2.9% (3,160) 0 0 $21.97 Downtown Brooklyn 76 3,514,006 121,531 121,531 3.5% 990 0 0 $25.00 North Brooklyn 287 3,566,310 232,693 232,693 6.5% 2,750 0 0 $17.77 Northeast Queens 158 1,803,852 14,293 14,293 0.8% (2,880) 0 0 $25.79 Northwest Queens 152 2,006,237 272,497 272,497 13.6% (5,041) 0 0 $22.22 South Brooklyn 333 3,726,571 91,221 92,221 2.5% 11,610 0 0 $23.19 South Queens 177 1,965,561 109,867 109,867 5.6% (64) 0 0 $17.94 Staten Island 433 2,353,295 86,374 86,374 3.7% 5,948 0 0 $21.24 Totals 1,726 20,113,949 962,216 963,216 4.8% 10,153 0 0 $21.17 Total Office Submarket Statistics First Quarter 2010 Existing Inventory Vacancy YTD Net YTD Under Quoted Market # Blds Total RBA Direct SF Total SF Vac % Absorption Deliveries Const SF Rates Central Queens 179 3,422,144 122,970 122,970 3.6% 26,786 0 0 $26.67 Downtown Brooklyn 159 19,987,007 919,978 1,014,750 5.1% 102,764 0 0 $30.01 North Brooklyn 437 7,047,941 757,061 893,333 12.7% 4,489 0 14,547 $21.70 Northeast Queens 535 8,585,325 234,460 235,960 2.7% 26,604 10,000 0 $30.26 Northwest Queens 264 9,543,803 606,683 606,683 6.4% 25,998 0 684,000 $23.31 South Brooklyn 536 7,898,541 375,211 378,211 4.8% 328 7,000 189,810 $26.95 South Queens 268 5,027,506 307,427 307,427 6.1% 39,586 0 0 $20.71 Staten Island 617 5,453,064 555,124 555,124 10.2% 24,141 0 3,439 $21.85 Totals 2,995 66,965,331 3,878,914 4,114,458 6.1% 250,696 17,000 891,796 $25.52 12 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market FIGURES AT A GLANCE FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS Class A Market Statistics First Quarter 2010 Existing Inventory Vacancy Net Deliveries UC Inventory Period # Blds Total RBA Direct SF Total SF Vac % Absorption # Blds Total RBA # Blds Total RBA Rates 2010 53 16,028,039 1,032,294 1,122,317 7.0% 99,540 0 0 3 763,516 $30.26 2009 4q 53 16,028,039 1,131,499 1,221,857 7.6% 191,796 1 59,060 3 763,516 $28.72 2009 52 15,968,979 1,130,240 1,354,593 8.5% 117,895 0 0 4 822,576 $30.18 2009 2q 52 15,968,979 1,243,351 1,472,488 9.2% (16,236) 0 0 4 822,576 $31.60 2009 52 15,968,979 1,214,937 1,456,252 9.1% 137,188 0 0 4 822,576 $33.95 2008 52 15,968,979 1,225,424 1,593,440 10.0% 72,251 0 0 4 822,576 $32.39 2007 52 15,968,979 1,294,996 1,665,691 10.4% 619,555 3 685,875 0 0 $30.44 2006 49 15,283,104 1,279,379 1,599,371 10.5% (121,932) 1 270,000 3 685,875 $31.89 2005 48 15,013,104 827,268 1,207,439 8.0% 333,833 1 358,160 3 898,452 $34.21 2004 47 14,654,944 957,953 1,183,112 8.1% 1,311,903 1 1,387,607 1 358,160 $26.90 2003 46 13,267,337 1,069,883 1,107,408 8.3% 379,973 1 653,000 1 1,387,607 $28.83 2002 45 12,614,337 663,911 834,381 6.6% (263,452) 3 212,823 2 2,040,607 $31.96 2001 42 12,401,514 245,395 358,106 2.9% (47,343) 0 0 4 2,172,504 $31.72 2000 42 12,401,514 200,944 310,763 2.5% 235,053 0 0 0 0 $28.39 1999 42 12,401,514 391,061 545,816 4.4% 426,641 1 75,000 0 0 $25.96 1998 41 12,326,514 698,511 897,457 7.3% 255,299 1 850,975 1 75,000 $25.78 Quoted Class B Market Statistics First Quarter 2010 Existing Inventory Vacancy Net Deliveries Period # Blds Total RBA Direct SF Total SF Vac % Absorption # Blds Total RBA # Blds Total RBA Rates 2010 1,216 30,823,343 1,884,404 2,028,925 6.6% 141,003 2 17,000 10 128,280 $26.18 2009 4q 1,214 30,806,343 2,008,407 2,152,928 7.0% 70,158 1 10,200 12 145,280 $26.05 2009 1,213 30,796,143 2,063,165 2,212,886 7.2% 84,324 3 86,972 13 155,480 $26.99 2009 2q 1,210 30,709,171 2,066,266 2,210,238 7.2% 73,746 6 94,161 14 183,158 $27.74 2009 1,204 30,615,010 2,036,151 2,189,823 7.2% (34,757) 1 2,500 14 233,772 $28.52 2008 1,203 30,612,510 2,009,984 2,152,566 7.0% (81,031) 21 297,394 11 180,099 $28.02 2007 1,184 30,795,576 2,140,531 2,254,601 7.3% 508,855 28 537,277 19 306,508 $26.36 2006 1,157 30,262,849 2,078,595 2,230,729 7.4% 483,498 18 215,719 24 500,654 $24.65 2005 1,139 30,047,130 2,476,471 2,498,508 8.3% 671,051 26 372,617 19 227,624 $24.34 2004 1,113 29,674,513 2,757,922 2,796,942 9.4% 738,303 13 155,648 25 391,087 $22.81 2003 1,101 29,568,865 3,397,537 3,429,597 11.6% (160,148) 8 95,930 11 149,698 $21.96 2002 1,093 29,472,935 2,949,545 3,173,519 10.8% (59,652) 3 31,678 7 86,930 $22.77 2001 1,090 29,441,257 2,747,521 3,082,189 10.5% 368,474 16 484,273 3 31,678 $22.56 2000 1,074 28,956,984 2,870,542 2,966,390 10.2% (505,213) 14 283,236 15 472,740 $23.39 1999 1,060 28,673,748 2,079,602 2,177,941 7.6% 647,333 8 80,252 14 307,250 $13.75 1998 1,052 28,593,496 2,605,855 2,745,022 9.6% (799,336) 8 357,138 7 75,452 $14.38 UC Inventory Quoted Total Office Market Statistics First Quarter 2010 Existing Inventory Vacancy Net Deliveries UC Inventory Period # Blds Total RBA Direct SF Total SF Vac % Absorption # Blds Total RBA # Blds Total RBA Rates 2010 2,995 66,965,331 3,878,914 4,114,458 6.1% 250,696 2 17,000 13 891,796 $25.52 2009 4q 2,993 66,948,331 4,112,675 4,348,154 6.5% 351,720 2 69,260 15 908,796 $25.44 2009 2,991 66,879,071 4,255,940 4,630,614 6.9% 264,082 3 86,972 17 978,056 $26.73 2009 2q 2,988 66,792,099 4,434,015 4,807,724 7.2% 412,034 6 94,161 18 1,005,734 $27.84 2009 2,982 66,697,938 4,730,010 5,125,597 7.7% (267,515) 1 2,500 18 1,056,348 $28.89 2008 2,982 66,698,613 4,348,159 4,858,757 7.3% (105,664) 22 309,648 15 1,002,675 $28.06 2007 2,963 66,874,526 4,442,741 4,929,006 7.4% 1,153,601 32 1,228,202 20 318,762 $26.22 2006 2,932 65,650,874 4,380,329 4,858,955 7.4% 528,504 24 563,178 27 1,186,529 $25.38 2005 2,908 65,087,696 4,422,073 4,824,281 7.4% 1,127,055 36 871,851 26 1,182,797 $24.76 2004 2,872 64,215,845 4,764,187 5,079,485 7.9% 2,310,821 26 1,647,569 35 897,671 $22.96 2003 2,847 62,618,276 5,700,152 5,792,737 9.3% 57,259 11 778,058 21 1,639,110 $23.16 2002 2,837 61,842,418 4,653,694 5,074,138 8.2% 313,909 13 454,414 11 2,156,665 $25.44 2001 2,826 61,450,234 4,504,400 4,995,863 8.1% (422,483) 18 491,341 11 2,399,098 $24.10 2000 2,808 60,958,893 3,871,372 4,082,039 6.7% (204,152) 15 337,878 19 654,704 $23.07 1999 2,793 60,621,015 3,276,915 3,540,009 5.8% 908,110 13 212,402 15 361,892 $17.51 1998 2,780 60,408,613 3,897,604 4,235,717 7.0% (736,045) 10 1,221,113 12 207,602 $18.01 Quoted 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 13

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market LEASING ACTIVITY Historical Rental Rates Based on Full-Service Equivalent Rental Rates A B C Total Market Dollars/SF/Year $40.00 $35.00 $30.00 $25.00 $20.00 $15.00 $10.00 $5.00 $0.00 1996 1997 1997 1998 1998 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 2010 Vacancy by Available Space Type Vacancy by Class Percent of All Vacant Space in Direct vs. Sublet Percent of All Vacant Space by Class New York Outer Boroughs United States New York Outer Boroughs United States 6% 6% 23% 15% 94% 94% 50% 27% 47% 38% Direct Sublet Direct Sublet Class A Class B Class C Class A Class B Class C U.S. Rental Rate Comparison Based on Full-Service Equivalent Rental Rates Future Space Available Space Scheduled to be Available for Occupancy* Dollars/SF/Year $35.00 $30.00 $25.00 $20.00 $15.00 $10.00 New York Outer Boroughs United States Millions 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.26 0.74 $5.00 $0.00 2008 2008 4q 2009 2009 2q 2009 2009 4q 2010 0.1 0.0 0.01 0.00 0.00 0.00 2010 2q 2010 2010 4q 2011 2011 2q 2011 * Includes Under Construction Spaces 14 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market LEASING ACTIVITY FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS Select Top Office Leases Based on Leased Square Footage For Deals Signed in 2010 Building Submarket SF Qtr Tenant Name Tenant Rep Company Landlord Rep Company 1 One MetLife Plaza Northwest Queens 185,572 1st Jet Blue Airways Jones Lang LaSalle Cushman & Wakefield, Inc. 2 One Pierrepont Plaza Downtown Brooklyn 37,529 1st N/A N/A Cushman & Wakefield, Inc. 3 133 27th Ave South Brooklyn 28,000 1st Block Institute Direct Deal M.C. O Brien, Inc. 4 Corporate Commons II Staten Island 25,000 1st MetLife Jones Lang LaSalle The Nicotra Group, LLC 5 39-02 Main St Northeast Queens 10,600 1st New York Life N/A CB Richard Ellis 6 Montague Court Building Downtown Brooklyn 6,698 1st City University of New York-City Tech Direct Deal SL Green Realty Corp. 7 2025 Richmond Ave Staten Island 6,200 1st American Access Care Cassidy Turley Coldwell Banker Reliable Commercial 8 177 Livingston St Downtown Brooklyn 5,414 1st N/A N/A Ingram & Hebron Realty 9 Brooklyn Renaissance Plaza Downtown Brooklyn 4,253 1st P.Schneider & Associates, PLLC N/A Muss Development Company 10 1491 Broadway North Brooklyn 4,200 1st N/A N/A Sholom & Zuckerbrot Realty, LLC 11 1267 57th St South Brooklyn 4,000 1st N/A N/A Schmidt Realty 12 55 Washington St Downtown Brooklyn 3,215 1st Edit.com Direct Deal Two Trees Management Co. 13 55 Washington St Downtown Brooklyn 3,151 1st Datalot Direct Deal Two Trees Management Co. 14 456 5th Ave North Brooklyn 3,000 1st N/A N/A M.C. O Brien, Inc. 15 3713 85th St Northeast Queens 3,000 1st N/A N/A Barak Realty 16 255-12 Hillside Ave South Queens 2,700 1st US Insurance Agency Direct Deal Ramesh Thakkar DDS 17 Temple Bar Building Downtown Brooklyn 2,680 1st N/A N/A Joseph P. Day Realty Corporation 18 Brooklyn Renaissance Plaza* Downtown Brooklyn 2,632 1st P.Schneider & Associates, PLLC N/A Muss Development Company 19 2546 E 17th St South Brooklyn 2,300 1st N/A Direct Deal Maximillion Realty 20 2546 E 17th St South Brooklyn 2,300 1st N/A Direct Deal Maximillion Realty 21 221-10 Jamaica Ave South Queens 2,250 1st Hurt Melvin Dpm Direct Deal 221 Corporation, LLC 22 Temple Bar Building Downtown Brooklyn 2,085 1st N/A N/A Joseph P. Day Realty Corporation 23 1424 Richmond Ave Staten Island 2,000 1st Heartshare Direct Deal Real Estate Investment Group 24 456 5th Ave North Brooklyn 2,000 1st Brad Lauder M.C. O Brien, Inc. M.C. O Brien, Inc. 25 6395 Amboy Rd Staten Island 1,933 1st N/A Direct Deal Advanced Investments 26 1296 A Willoughby Ave North Brooklyn 1,900 1st N/A Direct Deal Vera Loeffler 27 8514 Fourth Ave South Brooklyn 1,800 1st Kumon Learning Center A+M Real Estate Advisory Partners CPEX Real Estate 28 851 Manhattan Ave North Brooklyn 1,800 1st N/A N/A Mark David & Company 29 9409 Jamaica Ave Central Queens 1,800 1st Metro Therapy Inc Weichert Realtors Bonus Real Estate ERA Top Service Realty 30 1911 Richmond Ave Staten Island 1,800 1st N/A N/A Casandra Properties, Inc. 31 55 Washington St Downtown Brooklyn 1,686 1st Etsy.com Direct Deal Two Trees Management Co. 32 3010 Amboy Rd Staten Island 1,470 1st N/A N/A Volpe Realty, Inc 33 55 Washington St Downtown Brooklyn 1,436 1st Johannes Girardoni Studio, Inc. Direct Deal Two Trees Management Co. 34 97 New Dorp Ln Staten Island 1,350 1st N/A N/A Star Real Estate 35 45 Main St Downtown Brooklyn 1,333 1st Insurgent Media, LLC City Connections Realty Two Trees Management Co. 36 45 Main St Downtown Brooklyn 1,300 1st Kenneth C. Meier Corp. Direct Deal Two Trees Management Co. 37 45 Main St Downtown Brooklyn 1,300 1st N/A Direct Deal Two Trees Management Co. 38 55 Washington St Downtown Brooklyn 1,258 1st Red Horse Strategies LLC Direct Deal Two Trees Management Co. 39 2111 Williamsbridge Rd Bronx 1,200 1st N/A N/A Locascio Realty 40 2111 Williamsbridge Rd Bronx 1,200 1st N/A N/A Locascio Realty * Renewal 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 15

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market SALES ACTIVITY The Optimist Sales Index Average of Two Highest Price/SF's and Two Lowest Cap Rates Per Quarter 14.0% Cap Rate Price/SF $600 12.0% $500 Cap Rate Percentage 10.0% 8.0% 6.0% 4.0% $400 $300 $200 Dollars/SF 2.0% $100 0.0% 2007 2007 2q 2007 2007 4q 2008 2008 2q 2008 2008 4q 2009 2009 2q 2009 2009 4q $0 Source: CoStar COMPS Sales Volume & Price Sales Analysis by Building Size Based on Office Building Sales of 15,000 SF and Larger Based on Office Building Sales From Jan. 2009 - Dec. 2009 Sales Volume Price/SF Bldg Size # RBA $ Volume Price/SF Cap Rate $700 $450 Millions of Sales Volume Dollars $600 $500 $400 $300 $200 $100 $400 $350 $300 $250 $200 $150 $100 $50 Price/SF < 50,000 SF 65 421,998 $ 116,793,686 $ 276.76 8.40% 50K-249K SF 2 192,574 $ 10,610,000 $ 55.10-250K-499K SF - - - $ - - $0 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 $0 >500K SF - - - $ - - Source: CoStar COMPS Source: CoStar COMPS U.S. Price/SF Comparison Based on Office Building Sales of 15,000 SF and Larger U.S. Cap Rate Comparison Based on Office Building Sales of 15,000 SF and Larger $420 New York Outer Boroughs US 15.0% New York Outer Boroughs US Dollars per SF $370 $320 $270 $220 $170 $120 $70 Cap Rate Percentage 13.0% 11.0% 9.0% 7.0% 5.0% $20 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 3.0% 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 Source: CoStar COMPS Source: CoStar COMPS 16 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.

New York Outer Boroughs Office Market SALES ACTIVITY FIRST QUARTER 2010 NEW YORK OUTER BOROUGHS 2010 COSTAR GROUP, INC. THE COSTAR OFFICE REPORT 17

NEW YORK OUTER BOROUGHS FIRST QUARTER 2010 New York Outer Boroughs Office Market SALES ACTIVITY Select Land Sales Based on Commercially Zoned Land Sales Occurring From Jan. 2009 - March 2010 205 Water St, Brooklyn 9015 Corona Ave, Elmhurst 41-01 23rd St, Long Island City Sale Price: $8,600,000 Sale Price: $5,800,000 Sale Price: $3,200,000 Acres: 0.48 Acres: 1.42 Acres: 0.36 Price/SF: $415.46 Price/SF: $93.55 Price/SF: $202.71 Closing Date: 12/23/2009 Closing Date: 11/30/2009 Closing Date: 02/10/2009 Zoning: R7A, R8A Zoning: R6B Zoning: M1-5/R9 Intended Use: Hold for Development Intended Use: Mixed Use Intended Use: Commercial Buyer: Toll Brothers, Inc. Buyer: 90 Queens Inc Buyer: Queensboro Development LLC Seller: H.K. Organization Seller: A.M.F. Machine Corp Seller: Angelo Holding Corp 124-16 31st Ave, College Point 36-39 Prince St, Flushing 384 Neptune Ave, Brooklyn Sale Price: $2,100,000 Sale Price: $1,660,000 Sale Price: $1,035,000 Acres: 0.86 Acres: 0.07 Acres: 0.26 Price/SF: $55.99 Price/SF: $556.30 Price/SF: $90.91 Closing Date: 12/23/2009 Closing Date: 10/14/2009 Closing Date: 09/17/2009 Zoning: M1-1 Zoning: C4-2, New York, (V1) Zoning: R6 (M1) Intended Use: Self-Storage Intended Use: Hold for Development Intended Use: Commercial Buyer: Storage Deluxe Management Company, LLBuyer: Mott & Prince Management, Inc. Buyer: Maximillion Realty Seller: The Home Depot, Inc. Seller: Nikola Realty NY LLC Seller: Beth Hamidrash Hagodol Agudath Ach Source: CoStar COMPS 18 THE COSTAR OFFICE REPORT 2010 COSTAR GROUP, INC.