The CoStar Office Report. Y e a r - E n d South Florida Office Market

Transcription

1 The CoStar Office Report Y e a r - E n d

2 Table of Contents Table of Contents A Methodology C Terms & Definitions D 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 Class & Market Figures at a Glance by Class & Submarket Figures at a Glance Grouped by CBD vs Suburban 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 Aventura Market Biscayne Corridor Market Boca Raton Market Boynton/Lantana Market Brickell Market Coconut Grove Market Commercial Blvd Market Coral Gables Market Coral Way Market Cypress Creek Market Delray Beach Market Downtown Fort Lauderdale Market Downtown Miami Market Fort Lauderdale Market Hallandale Market Hollywood Market Jupiter Market Kendall Market Medley/Hialeah Market Miami Market Miami Airport Market Miami Beach Market Miami Lakes Market Miami-Dade Central County Market North Palm Beach Market Northeast Dade Market NW Broward/Coral Springs Market Outlying Broward County Market Outlying Miami-Dade Cnty Market Palm Beach Market Palm Springs/Lake Worth Market Plantation Market 2016 CoStar Group, Inc. The CoStar Office Report A

3 South Florida Year-End 2016 Table of Contents (Continued) Pompano Beach Market Royal Palm Bch/Wellington Market Sawgrass Park Market South Dade Market Southwest Broward Market West Miami Market West Palm Beach Market B The CoStar Office Report 2016 CoStar Group, Inc.

4 Methodology The CoStar Office Statistics, 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 global database includes approximately 95.6 billion square feet of coverage in 4.4 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 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 2016 CoStar Group, Inc. The CoStar Office Report C

5 South Florida Year-End 2016 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. : 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 D The CoStar Office Report 2016 CoStar Group, Inc.

6 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. Rental Rate: The asking rate per square foot for a particular building or unit of space by a broker or property owner. 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. : 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 CoStar Group, Inc. The CoStar Office Report E

7 Overview South Florida s Decreases to 1 Net Absorption Positive 673,514 SF in the Quarter The South Florida Office market ended the fourth quarter 2016 with a vacancy rate of 1. The vacancy rate was down over the previous quarter, with net absorption totaling positive 673,514 square feet in the fourth quarter. Vacant sublease space increased in the quarter, ending the quarter at 587,195 square feet. Rental rates ended the fourth quarter at $29.68, an increase over the previous quarter. A total of four buildings delivered to the market in the quarter totaling 91,450 square feet, with 2,760,943 square feet still under construction at the end of the quarter. Absorption Net absorption for the overall South Florida office market was positive 673,514 square feet in the fourth quarter That compares to positive 996,891 square feet in the third quarter 2016, positive 984,144 square feet in the second quarter 2016, and positive 316,959 square feet in the first quarter The Class-A office market recorded net absorption of positive 167,521 square feet in the fourth quarter 2016, compared to positive 391,511 square feet in the third quarter 2016, positive 77,084 in the second quarter 2016, and positive 257,279 in the first quarter The Class-B office market recorded net absorption of positive 301,310 square feet in the fourth quarter 2016, compared to positive 448,681 square feet in the third quarter 2016, positive 545,647 in the second quarter 2016, and positive 163,431 in the first quarter The Class-C office market recorded net absorption of positive 204,683 square feet in the fourth quarter 2016 compared to positive 156,699 square feet in the third quarter 2016, positive 361,413 in the second quarter 2016, and negative (103,751) in the first quarter Net absorption for South Florida s central business district was positive 126,335 square feet in the fourth quarter That compares to positive 38,632 square feet in the third quarter 2016, positive 74,864 in the second quarter 2016, and negative (85,316) in the first quarter Net absorption for the suburban markets was positive 547,179 square feet in the fourth quarter That compares to positive 958,259 square feet in third quarter 2016, positive 909,280 in the second quarter 2016, and positive 402,275 in the first quarter The office vacancy rate in the South Florida market area decreased to 1 at the end of the fourth quarter The vacancy rate was 10.3% at the end of the third quarter 2016, 10.8% at the end of the second quarter 2016, and 11.1% at the end of the first quarter Class-A projects reported a vacancy rate of 13.4% at the end of the fourth quarter 2016, 13.6% at the end of the third quarter 2016, 14.3% at the end of the second quarter 2016, and 14.3% at the end of the first quarter Class-B projects reported a vacancy rate of 11.0% at the end of the fourth quarter 2016, 11.2% at the end of the third quarter 2016, 11.6% at the end of the second quarter 2016, and 11.9% at the end of the first quarter Class-C projects reported a vacancy rate of 4.9% at the end of the fourth quarter 2016, 5.2% at the end of third quarter 2016, 5.5% at the end of the second quarter 2016, and 6.1% at the end of the first quarter The overall vacancy rate in South Florida s central business district at the end of the fourth quarter 2016 decreased to 13.0%. The vacancy rate was 13.3% at the end of the third Rates by Class A B C Total Market 25% 20% Rate 15% 10% 5% 0% q q q q q q q q q q q q q q q q q q 2016 CoStar Group, Inc. The CoStar Office Report 1

8 South Florida Year-End 2016 Overview quarter 2016, 13.3% at the end of the second quarter 2016, and 13.5% at the end of the first quarter The vacancy rate in the suburban markets decreased to 9.4% in the fourth quarter The vacancy rate was 9.7% at the end of the third quarter 2016, 10.2% at the end of the second quarter 2016, and 10.6% at the end of the first quarter Sublease The amount of vacant sublease space in the South Florida market increased to 587,195 square feet by the end of the fourth quarter 2016, from 587,013 square feet at the end of the third quarter There was 497,738 square feet vacant at the end of the second quarter 2016 and 529,577 square feet at the end of the first quarter South Florida s Class-A projects reported vacant sublease space of 412,107 square feet at the end of fourth quarter 2016, up from the 383,307 square feet reported at the end of the third quarter There were 332,376 square feet of sublease space vacant at the end of the second quarter 2016, and 294,266 square feet at the end of the first quarter Class-B projects reported vacant sublease space of 156,760 square feet at the end of the fourth quarter 2016, down from the 180,628 square feet reported at the end of the third quarter At the end of the second quarter 2016 there were 140,284 square feet, and at the end of the first quarter 2016 there were 185,409 square feet vacant. Class-C projects reported decreased vacant sublease space from the third quarter 2016 to the fourth quarter Sublease vacancy went from 23,078 square feet to 18,328 square feet during that time. There was 25,078 square feet at the end of the second quarter 2016, and 49,902 square feet at the end of the first quarter Sublease vacancy in South Florida s central business district stood at 174,265 square feet at the end of the fourth U.S. Comparison Past 10 Quarters Rate % South Florida United States q quarter It was 221,705 square feet at the end of the third quarter 2016, 148,251 square feet at the end of the second quarter 2016, and 141,539 square feet at the end of the first quarter Sublease vacancy in the suburban markets ended the fourth quarter 2016 at 412,930 square feet. At the end of the third quarter 2016 sublease vacancy was 365,308 square feet, was 349,487 square feet at the end of the second quarter 2016, and was 388,038 square feet at the end of the first quarter Rental Rates The average quoted asking rental rate for available office space, all classes, was $29.68 per square foot per year at the end of the fourth quarter 2016 in the South Florida market area. This represented a 1.6% increase in quoted rental rates from the end of the third quarter 2016, when rents were reported at $29.21 per square foot. The average quoted rate within the Class-A sector was $36.28 at the end of the fourth quarter 2016, while Class-B rates stood at $26.42, and Class-C rates at $ At the end of the third quarter 2016, Class-A rates were $35.55 per square foot, Class-B rates were $26.21, and Class-C rates were $ The average quoted asking rental rate in South Florida s CBD was $36.84 at the end of the fourth quarter 2016, and $27.72 in the suburban markets. In the third quarter 2016, quoted rates were $36.30 in the CBD and $27.42 in the suburbs. Deliveries and Construction During the fourth quarter 2016, four buildings totaling 91,450 square feet were completed in the South Florida market area. This compares to six buildings totaling 87,704 square feet that were completed in the third quarter 2016, six buildings totaling 257,741 square feet completed in the second quarter 2016, and 621,751 square feet in nine buildings completed in the first quarter There were 2,760,943 square feet of office space under construction at the end of the fourth quarter Some of the notable 2016 deliveries include: NSU Center for Collaborative Research, a 215,000-square-foot facility that delivered in first quarter 2016 and is now 72% occupied, and Three Brickell City Centre, a 134,552-square-foot building that delivered in first quarter 2016 and is now 100% occupied. The largest projects underway at the end of fourth quarter 2016 were American Express, a 400,000-square-foot building with 100% of its space pre-leased, and 800 Waterford, a 246,085-square-foot facility that is 11% pre-leased. Inventory Total office inventory in the South Florida market area amounted to 224,608,406 square feet in 11,218 buildings as of the end of the fourth quarter The Class-A office sector consisted of 58,929,775 square feet in 415 projects. There were 2 The CoStar Office Report 2016 CoStar Group, Inc.

9 Overview 3,463 Class-B buildings totaling 107,596,773 square feet, and the Class-C sector consisted of 58,081,858 square feet in 7,340 buildings. Within the Office market there were 419 owneroccupied buildings accounting for 12,414,286 square feet of office space. Sales Activity Tallying office building sales of 15,000 square feet or larger, South Florida office sales figures fell during the third quarter 2016 in terms of dollar volume compared to the second quarter of In the third quarter, 34 office transactions closed with a total volume of $773,607,800. The 34 buildings totaled 3,256,551 square feet and the average price per square foot equated to $ per square foot. That compares to 34 transactions totaling $867,547,525 in the second quarter The total square footage in the second quarter was 3,434,148 square feet for an average price per square foot of $ Total office building sales activity in 2016 was up compared to In the first nine months of 2016, the market saw 102 office sales transactions with a total volume of $2,207,855,357. The price per square foot averaged $ In the same first nine months of 2015, the market posted 142 transactions with a total volume of $1,952,168,415. The price per square foot averaged $ Cap rates have been higher in 2016, averaging 6.53% compared to the same period in 2015 when they averaged 6.41%. One of the largest transactions that has occurred within the last four quarters in the South Florida market is the sale of Southeast Financial Center in Miami. This 1,225,000-squarefoot office building sold for $516,600,000, or $ per square foot. The property sold on 12/2/2016. Absorption & Deliveries Past 10 Quarters Net Absorption Deliveries q Reports compiled by: Alfredo Negron, CoStar Research Manager CoStar Group, Inc. The CoStar Office Report 3

10 South Florida 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 Aventura Biscayne Corridor Submarkets Aventura Biscayne Corridor Boca Raton Boca Raton East Boca Raton North Boca Raton West Boynton/Lantana Brickell Coconut Grove Commercial Blvd Coral Gables Coral Way Cypress Creek Delray Beach Downtown Fort Lauderdale Downtown Miami Fort Lauderdale Hallandale Hollywood Jupiter Kendall Medley/Hialeah Miami Miami Airport Miami Beach Miami Lakes Miami-Dade Central County North Palm Beach Northeast Dade NW Broward/Coral Springs Outlying Broward County Outlying Miami-Dade Cnty Boynton/Lantana Brickell* Coconut Grove Commercial Blvd Coral Gables Coral Way Cypress Creek Delray Beach Downtown Fort Lauderdale* Downtown Miami* Fort Lauderdale Hallandale Hollywood Jupiter Kendall Medley/Hialeah Miami Miami Airport Miami Beach Miami Lakes Hialeah Gardens North Palm Beach* Northeast Dade NW Broward/Coral Springs Outlying Broward County Outlying Miami-Dade Cnty Palm Beach Palm Bch Cty Outlying Palm Beach* Palm Springs/Lake Worth Plantation Pompano Beach Royal Palm Bch/Wellington Sawgrass Park South Dade Southwest Broward West Miami Palm Springs/Lake Worth Plantation Pompano Beach Royal Palm Bch/Wellington Sawgrass Park South Dade Southwest Broward West Miami West Palm Beach West Palm Beach** West Palm Beach** CBD * Submarkets comprising the CBD. For statistics reference the CBD vs Suburban Figures at a Glance Page. 4 The CoStar Office Report 2016 CoStar Group, Inc.

11 Inventory & development Historical Deliveries Deliveries Average Delivered SF Millions of SF * 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 Sawgrass Park 2 418, , % 57, ,098 Downtown Miami 2 318,000 99, % 144, ,000 Miami Airport 2 302,492 74, % 44, ,246 Aventura 3 279, , % 39,716 93,174 Pompano Beach 5 215, , % 14,325 43,054 Coral Gables 3 188,407 59, % 24,796 62,802 Southwest Broward 3 146,379 11, % 26,238 48,793 Brickell 2 145,000 15, % 115,167 72,500 Northeast Dade 3 139, , % 12,498 46,333 Coconut Grove 2 131, ,806 65,795 All Other , , % 16,774 20,743 Totals 50 2,760,943 1,509, % 20,022 55,219 Recent Deliveries Leased & Un-Leased SF in Deliveries Since 2012 Future Deliveries Preleased & Un-Leased SF in Properties Scheduled to Deliver 1.2 Leased Un-Leased 1,400 Preleased Un-Leased 1.0 1,200 Millions of SF Thousands of SF 1, T q q 2016 CoStar Group, Inc. The CoStar Office Report 5

12 South Florida Year-End 2016 Inventory & development Historical Construction Starts & Deliveries Square Footage Per Quarter Starting and Completing Construction Construction Starts 0.85 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 , , % $ , ,625 50,000 SF - 99,999 SF 4 291, , % $ , , ,000 SF - 249,999 SF 3 481, , % $ , ,000 SF - 499,999 SF $ 0 0 >= 500,000 SF $ 0 0 Recent Development by Tenancy Comparison Based on RBA Developed for Single & Multi Tenant Use Based on Total RBA 2016 Deliveries Currently Under Construction By Class By Space Type 17% 15% 26% 13% 26% 83% 85% 48% 87% Multi Single Multi Single Class A Class B Class C Multi Single 6 The CoStar Office Report 2016 CoStar Group, Inc.

13 Inventory & development 2016 CoStar Group, Inc. The CoStar Office Report 7

14 South Florida Year-End 2016 Inventory & development 8 The CoStar Office Report 2016 CoStar Group, Inc.

15 Figures at a Glance Class A Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates Aventura ,517 85,211 88, % (30,706) 0 224,689 $47.50 Biscayne Corridor 3 699, , , % 13, $41.00 Boca Raton 67 7,802,453 1,266,179 1,304, % 145, $32.84 Boynton/Lantana 4 464, , , % 14, $22.62 Brickell 15 4,969, , , % 198, , ,000 $49.45 Coconut Grove 4 547,332 36,224 46, % 5, ,920 $38.52 Commercial Blvd 3 233,266 22,814 22, % 20, $23.78 Coral Gables 30 4,778, , , % (2,309) 0 188,407 $41.70 Coral Way 1 84, ,117 $ Cypress Creek 20 2,394, , , % (55,199) 0 0 $28.19 Delray Beach 1 30, $35.27 Downtown Fort Lauder. 21 4,466, , , % 95, $39.12 Downtown Miami 10 5,268, , , % (38,643) 0 318,000 $44.90 Fort Lauderdale 6 959, , , % (981) 0 0 $27.23 Hallandale $ Hollywood 2 334,447 41,909 41, % (11,159) 0 0 $33.28 Jupiter ,384 29,917 31, % 18, $38.72 Kendall 15 1,757, , , % (13,654) 0 0 $36.91 Medley/Hialeah 6 786, , , % 36, $26.39 Miami 9 1,115, , , % 26, ,906 $46.24 Miami Airport 36 5,334, , , % (48,759) 71, ,492 $32.73 Miami Beach 7 873,925 36,601 48, % (14,756) 0 0 $44.61 Miami Lakes 7 417, , , % 6, $26.79 Miami-Dade Central C $ North Palm Beach 21 1,525, , , % 24, $33.79 Northeast Dade 2 188,750 22,342 27, % 33, $30.26 NW Broward/Coral Spr , , , % 51, $26.14 Outlying Broward Cou $ Outlying Miami-Dade $ Palm Beach $ Palm Springs/Lake Wo. 1 50, , $ Plantation 16 2,081, , , % 180, ,000 0 $31.97 Pompano Beach 2 288,653 66,380 82, % (20,550) 0 87,068 $27.21 Royal Palm Bch/Welli ,705 5,367 5, % 3, $33.47 Sawgrass Park 15 1,749, , , % 71,592 69, ,000 $31.59 South Dade $ Southwest Broward 32 3,344, , , % 124, ,431 $29.60 West Miami 1 46, $23.00 West Palm Beach 25 3,928, , , % 34, $34.52 Totals ,929,775 7,462,403 7,874, % 893, ,790 1,904,030 $ CoStar Group, Inc. The CoStar Office Report 9

16 South Florida Year-End 2016 Figures at a Glance Class B Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates Aventura ,122 14,543 16, % 10, ,832 $39.80 Biscayne Corridor 28 1,030,952 72,340 74, % (8,925) 0 8,643 $37.38 Boca Raton 227 7,682, , , , $24.96 Boynton/Lantana 76 1,665, , , % 44,697 36,000 0 $25.45 Brickell 33 2,870, , , % (78,341) 18,000 45,000 $35.07 Coconut Grove 26 1,074,681 63,124 63, % (16,684) 0 15,670 $34.89 Commercial Blvd , , , % (57,197) 0 0 $20.94 Coral Gables 116 4,112, , , % (3,895) 0 0 $35.56 Coral Way 33 1,077,214 35,829 36, % 4, $29.05 Cypress Creek 115 4,461, , , % 5, $21.78 Delray Beach 118 2,477, , , % 66,259 23,042 44,969 $22.65 Downtown Fort Lauder. 94 2,167, , , % 38,354 28,624 34,627 $32.98 Downtown Miami 37 5,186, , , % 8, $30.66 Fort Lauderdale 166 4,991, , , % 23,788 8,792 0 $23.75 Hallandale ,364 17,852 17, % 22, ,600 $28.29 Hollywood 113 2,697, , , % 67, $27.27 Jupiter 111 2,276, , , % 28,991 13,750 0 $27.18 Kendall 225 6,220, , , % 91, ,614 $27.09 Medley/Hialeah 65 1,809, , , % 68, ,136 $26.49 Miami 53 2,360, , , % 29,387 44,000 22,365 $33.64 Miami Airport ,382,461 1,081,953 1,099, % 29,850 41,000 0 $26.00 Miami Beach 67 2,439, , , % 90, $38.32 Miami Lakes 93 2,655, , , % 91, ,640 $22.73 Miami-Dade Central C , $ North Palm Beach 168 5,368, , , , ,632 $25.35 Northeast Dade 78 2,447, , , % 86, , ,000 $25.63 NW Broward/Coral Spr ,871, , , % 26,487 11,613 0 $23.44 Outlying Broward Cou. 2 28,296 2,802 2, % (2,802) 0 0 $33.46 Outlying Miami-Dade , $ Palm Beach 90 1,841, , , % 46, ,000 $45.57 Palm Springs/Lake Wo ,004 43,887 43, % 52,631 62,305 0 $30.55 Plantation 140 4,087, , , % 45, $22.80 Pompano Beach 168 3,825, , , % 44,608 22, ,200 $21.87 Royal Palm Bch/Welli. 46 1,169,021 78,287 78, % 23,269 13,200 17,360 $28.87 Sawgrass Park 41 1,742, , , % 92, ,197 $25.12 South Dade 46 1,402, , , % 3, ,480 $24.19 Southwest Broward 181 3,795, , , % 187,633 4,300 81,948 $25.12 West Miami ,087 7,184 7, % 19, $23.88 West Palm Beach 244 5,817, , , % (121,149) 0 0 $22.86 Totals 3, ,596,773 11,678,781 11,835, % 1,459, , ,913 $ The CoStar Office Report 2016 CoStar Group, Inc.

17 Figures at a Glance Class A Submarket Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates Aventura ,517 85,211 88, % (30,706) 0 224,689 $47.50 Biscayne Corridor 3 699, , , % 13, $41.00 Boca Raton East 16 1,762, , , % 28, $33.28 Boca Raton North 25 3,645, , , % 66, $28.42 Boca Raton West 26 2,394, , , % 50, $39.49 Boynton/Lantana 4 464, , , % 14, $22.62 Brickell 15 4,969, , , % 198, , ,000 $49.45 Coconut Grove 4 547,332 36,224 46, % 5, ,920 $38.52 Commercial Blvd 3 233,266 22,814 22, % 20, $23.78 Coral Gables 30 4,778, , , % (2,309) 0 188,407 $41.70 Coral Way 1 84, ,117 $ Cypress Creek 20 2,394, , , % (55,199) 0 0 $28.19 Delray Beach 1 30, $35.27 Downtown Fort Lauder. 21 4,466, , , % 95, $39.12 Downtown Miami 10 5,268, , , % (38,643) 0 318,000 $44.90 Fort Lauderdale 6 959, , , % (981) 0 0 $27.23 Hallandale $ Hialeah Gardens $ Hollywood 2 334,447 41,909 41, % (11,159) 0 0 $33.28 Jupiter ,384 29,917 31, % 18, $38.72 Kendall 15 1,757, , , % (13,654) 0 0 $36.91 Medley/Hialeah 6 786, , , % 36, $26.39 Miami 9 1,115, , , % 26, ,906 $46.24 Miami Airport 36 5,334, , , % (48,759) 71, ,492 $32.73 Miami Beach 7 873,925 36,601 48, % (14,756) 0 0 $44.61 Miami Lakes 7 417, , , % 6, $26.79 North Palm Beach 21 1,525, , , % 24, $33.79 Northeast Dade 2 188,750 22,342 27, % 33, $30.26 NW Broward/Coral Spr , , , % 51, $26.14 Outlying Broward Cou $ Outlying Miami-Dade $ Palm Bch Cty Outlyin $ Palm Beach $ Palm Springs/Lake Wo. 1 50, , $ Plantation 16 2,081, , , % 180, ,000 0 $31.97 Pompano Beach 2 288,653 66,380 82, % (20,550) 0 87,068 $27.21 Royal Palm Bch/Welli ,705 5,367 5, % 3, $33.47 Sawgrass Park 15 1,749, , , % 71,592 69, ,000 $31.59 South Dade $ Southwest Broward 32 3,344, , , % 124, ,431 $29.60 West Miami 1 46, $23.00 West Palm Beach 10 1,196, , , % 22, $29.67 West Palm Beach CBD 15 2,732, , , % 11, $37.19 Totals ,929,775 7,462,403 7,874, % 893, ,790 1,904,030 $ CoStar Group, Inc. The CoStar Office Report 11

18 South Florida Year-End 2016 Figures at a Glance Class B Submarket Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates Aventura ,122 14,543 16, % 10, ,832 $39.80 Biscayne Corridor 28 1,030,952 72,340 74, % (8,925) 0 8,643 $37.38 Boca Raton East 125 2,625, , , % 11, $27.35 Boca Raton North 51 3,110, , , % 39, $23.00 Boca Raton West 51 1,945, , , % 128, $27.37 Boynton/Lantana 76 1,665, , , % 44,697 36,000 0 $25.45 Brickell 33 2,870, , , % (78,341) 18,000 45,000 $35.07 Coconut Grove 26 1,074,681 63,124 63, % (16,684) 0 15,670 $34.89 Commercial Blvd , , , % (57,197) 0 0 $20.94 Coral Gables 116 4,112, , , % (3,895) 0 0 $35.56 Coral Way 33 1,077,214 35,829 36, % 4, $29.05 Cypress Creek 115 4,461, , , % 5, $21.78 Delray Beach 118 2,477, , , % 66,259 23,042 44,969 $22.65 Downtown Fort Lauder. 94 2,167, , , % 38,354 28,624 34,627 $32.98 Downtown Miami 37 5,186, , , % 8, $30.66 Fort Lauderdale 166 4,991, , , % 23,788 8,792 0 $23.75 Hallandale ,364 17,852 17, % 22, ,600 $28.29 Hialeah Gardens 8 176, $ Hollywood 113 2,697, , , % 67, $27.27 Jupiter 111 2,276, , , % 28,991 13,750 0 $27.18 Kendall 225 6,220, , , % 91, ,614 $27.09 Medley/Hialeah 65 1,809, , , % 68, ,136 $26.49 Miami 53 2,360, , , % 29,387 44,000 22,365 $33.64 Miami Airport ,382,461 1,081,953 1,099, % 29,850 41,000 0 $26.00 Miami Beach 67 2,439, , , % 90, $38.32 Miami Lakes 93 2,655, , , % 91, ,640 $22.73 North Palm Beach 168 5,368, , , , ,632 $25.35 Northeast Dade 78 2,447, , , % 86, , ,000 $25.63 NW Broward/Coral Spr ,871, , , % 26,487 11,613 0 $23.44 Outlying Broward Cou. 2 28,296 2,802 2, % (2,802) 0 0 $33.46 Outlying Miami-Dade , $ Palm Bch Cty Outlyin. 57 1,082,665 95,997 95, % 20, ,000 $29.06 Palm Beach , , , % 26, $60.74 Palm Springs/Lake Wo ,004 43,887 43, % 52,631 62,305 0 $30.55 Plantation 140 4,087, , , % 45, $22.80 Pompano Beach 168 3,825, , , % 44,608 22, ,200 $21.87 Royal Palm Bch/Welli. 46 1,169,021 78,287 78, % 23,269 13,200 17,360 $28.87 Sawgrass Park 41 1,742, , , % 92, ,197 $25.12 South Dade 46 1,402, , , % 3, ,480 $24.19 Southwest Broward 181 3,795, , , % 187,633 4,300 81,948 $25.12 West Miami ,087 7,184 7, % 19, $23.88 West Palm Beach 183 3,889, , , % (158,562) 0 0 $22.80 West Palm Beach CBD 61 1,928, , , % 37, $23.15 Totals 3, ,596,773 11,678,781 11,835, % 1,459, , ,913 $ The CoStar Office Report 2016 CoStar Group, Inc.

19 Figures at a Glance Class C Submarket Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates Aventura ,008 12,984 12, % (5,784) 0 0 $34.25 Biscayne Corridor 90 1,031,838 65,453 65, % 27, $33.38 Boca Raton East 156 1,434,436 62,606 62, % 2, $25.42 Boca Raton North 7 352, , $26.77 Boca Raton West ,604 17,671 17, % (11,875) 0 0 $25.03 Boynton/Lantana ,776 13,845 13, % 17, $22.64 Brickell ,581 6,630 6, $22.09 Coconut Grove ,019 14,874 16, % 8, $47.82 Commercial Blvd ,797 27,500 27, % 24, $18.61 Coral Gables 296 2,069,023 63,737 63, % 35, $31.49 Coral Way 193 1,203,573 10,134 10, % 31, $23.64 Cypress Creek 117 1,205,064 97,447 97, % (29,430) 0 0 $20.83 Delray Beach 247 1,448,875 39,589 39, % 16, $31.19 Downtown Fort Lauder ,513, , , % 38, $41.25 Downtown Miami 34 1,239, , , % (708) 0 0 $23.93 Fort Lauderdale 819 5,163, , , % 50, $18.48 Hallandale ,891 62,624 62, % 46, $25.40 Hialeah Gardens , , $21.58 Hollywood 505 3,144, , , % 71, $21.78 Jupiter ,495 27,168 27, % 20, $23.08 Kendall 291 3,678, , , % (11,804) 0 0 $27.18 Medley/Hialeah 271 1,738,965 54,990 54, % 2, $23.28 Miami 500 3,219, , , % 21, $29.32 Miami Airport 197 3,055,129 84,272 86, % 37, $23.38 Miami Beach 85 1,156,321 42,002 42, % 18, $35.81 Miami Lakes ,945 32,051 32, % 17, $19.23 North Palm Beach 202 1,697,552 66,491 66, % 23, $19.87 Northeast Dade 429 3,725, , , % 10, $21.85 NW Broward/Coral Spr ,531,855 79,779 79, % 21, $22.61 Outlying Broward Cou $ Outlying Miami-Dade. 1 7, $ Palm Bch Cty Outlyin ,487 30,661 31, % (3,526) 0 0 $21.85 Palm Beach , , $45.60 Palm Springs/Lake Wo ,157 22,495 22,495 (1,463) 0 0 $20.24 Plantation 191 2,167, , , % 25, $20.92 Pompano Beach 264 2,103,197 82,115 86, % 26, $22.21 Royal Palm Bch/Welli ,808 17,013 17, % 7, $24.70 Sawgrass Park , $20.81 South Dade ,701 37,260 37, % 21, $19.06 Southwest Broward ,430 15,054 15, % 22, $28.43 West Miami 267 1,196,874 10,715 10, % 9, $19.96 West Palm Beach 382 2,923, , , % (1,133) 0 0 $22.12 West Palm Beach CBD ,096 76,185 78, % (6,727) 0 0 $23.85 Totals 7,340 58,081,858 2,821,206 2,839, % 619, $ CoStar Group, Inc. The CoStar Office Report 13

20 South Florida Year-End 2016 Figures at a Glance Total Office Submarket Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates Aventura 47 1,866, , , % (25,670) 0 279,521 $43.86 Biscayne Corridor 121 2,761, , , % 32, ,643 $37.69 Boca Raton East 297 5,822, , , % 42, $30.12 Boca Raton North 83 7,109,564 1,110,679 1,140, , $25.84 Boca Raton West 91 4,503, , , % 167, $34.59 Boynton/Lantana 203 2,728, , , % 76,275 36,000 0 $24.52 Brickell 71 8,176,828 1,084,925 1,159, % 120, , ,000 $42.90 Coconut Grove 98 2,039, , , % (2,168) 0 131,590 $37.49 Commercial Blvd 49 1,425, , , % (12,584) 0 0 $21.35 Coral Gables ,959, , , % 29, ,407 $38.67 Coral Way 227 2,365,035 45,963 46,853 36, ,117 $26.47 Cypress Creek 252 8,060,955 1,258,638 1,307, % (79,401) 0 0 $23.51 Delray Beach 366 3,957, , , % 82,476 23,042 44,969 $23.46 Downtown Fort Lauder ,146, , , % 172,707 28,624 34,627 $37.93 Downtown Miami 81 11,693,562 1,903,914 1,920, % (30,857) 0 318,000 $38.69 Fort Lauderdale ,114,486 1,267,335 1,280, % 72,939 8,792 0 $22.67 Hallandale 148 1,525,255 80,476 80, % 68, ,600 $26.24 Hialeah Gardens , , $21.58 Hollywood 620 6,176, , , % 127, $25.79 Jupiter 213 3,535, , , % 68,185 13,750 0 $28.23 Kendall ,656, , , % 66, ,614 $29.47 Medley/Hialeah 342 4,335, , , % 106, ,136 $25.72 Miami 562 6,695, , , % 77,529 44,000 84,271 $32.01 Miami Airport ,772,114 1,594,730 1,628, % 18, , ,492 $28.25 Miami Beach 159 4,469, , , % 94, $39.59 Miami Lakes 140 3,542, , , % 115, ,640 $23.14 North Palm Beach 391 8,591, , , % 265, ,632 $26.65 Northeast Dade 509 6,361, , , % 130, , ,000 $24.32 NW Broward/Coral Spr ,119, , , % 99,496 11,613 0 $23.83 Outlying Broward Cou. 2 28,296 2,802 2, % (2,802) 0 0 $33.46 Outlying Miami-Dade , $ Palm Bch Cty Outlyin. 99 1,440, , , % 16, ,000 $27.91 Palm Beach 58 1,080, , , % 29, $60.46 Palm Springs/Lake Wo ,044,738 66,382 66, % 77,168 62,305 0 $25.53 Plantation 347 8,336, ,491 1,022, % 251, ,000 0 $26.04 Pompano Beach 434 6,216, , , % 50,929 22, ,268 $22.69 Royal Palm Bch/Welli. 82 1,727, , , % 33,825 13,200 17,360 $28.60 Sawgrass Park 67 3,825, , , % 164,037 69, ,197 $28.65 South Dade 219 2,307, , , % 24, ,480 $22.70 Southwest Broward 306 8,028, , , % 334,864 4, ,379 $27.90 West Miami 309 1,849,079 17,899 17, % 29, $21.73 West Palm Beach 575 8,008, , , % (136,872) 0 0 $23.82 West Palm Beach CBD 232 5,591, , , % 42, $32.78 Totals 11, ,608,406 21,962,390 22,549, ,971,508 1,058,646 2,760,943 $ The CoStar Office Report 2016 CoStar Group, Inc.

21 Figures at a Glance Class A Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates CBD 56 15,899,846 2,083,595 2,192, % 278, , ,000 $43.21 Suburban ,029,929 5,378,808 5,682, % 614, ,958 1,486,030 $33.39 Totals ,929,775 7,462,403 7,874, % 893, ,790 1,904,030 $36.28 Class B Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates CBD ,871,842 2,247,196 2,312, % (163,936) 46,624 79,627 $31.70 Suburban 3,083 92,724,931 9,431,585 9,522, % 1,623, , ,286 $25.34 Totals 3, ,596,773 11,678,781 11,835, % 1,459, , ,913 $26.42 Class C Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates CBD 942 7,334, , , % 39, $27.16 Suburban 6,398 50,746,896 2,366,897 2,385, % 579, $23.87 Totals 7,340 58,081,858 2,821,206 2,839, % 619, $24.44 Class A & B Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates CBD ,771,688 4,330,791 4,505, % 114, , ,627 $38.04 Suburban 3, ,754,860 14,810,393 15,204, % 2,237, ,190 2,263,316 $28.37 Totals 3, ,526,548 19,141,184 19,710, % 2,352,464 1,058,646 2,760,943 $30.51 Total Office Market Statistics Year-End 2016 YTD Net YTD Under Market # Blds Total RBA Total SF Vac % Absorption Deliveries Const SF Rates CBD 1,378 38,106,650 4,785,100 4,959, % 154, , ,627 $36.84 Suburban 9, ,501,756 17,177,290 17,590, % 2,816, ,190 2,263,316 $27.72 Totals 11, ,608,406 21,962,390 22,549, ,971,508 1,058,646 2,760,943 $ CoStar Group, Inc. The CoStar Office Report 15

22 South Florida Year-End 2016 Figures at a Glance 16 The CoStar Office Report 2016 CoStar Group, Inc.

23 Leasing Activity Historical Rental Rates Based on Full-Service Equivalent Rental Rates A B C Total Market $4 $35.00 $3 $25.00 $2 $15.00 $1 $5.00 $ q q q q q q q q q by Available Space Type by Class Percent of All in Direct vs. Sublet Percent of All by Class South Florida United States South Florida United States 3% 4% 13% 14% 52% 35% 47% 39% 97% 96% 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* $35.00 South Florida United States $3 2.0 $25.00 $2 $15.00 $1 $5.00 $ q q q q q q * Includes Under Construction Spaces 2016 CoStar Group, Inc. The CoStar Office Report 17

24 South Florida Year-End 2016 Leasing Activity Select Top O ce Leases Based on Leased Square Footage For Deals Signed in 2016 Building Submarket SF Qtr Tenant Name Tenant Rep Company Landlord Rep Company Avenue of the Americas* Downtown Miami 143,924 4th Wells Fargo Advisors N/A Cushman & Wake eld 2 98 SE 7th St Brickell 110,506 1st Akerman LLP N/A N/A SW 25th St Southwest Broward 91,872 1st Comcast Colliers International CBRE 4 78 SW 7th St Brickell 64,572 3rd WeWork N/A Swire Properties Inc W Sunrise Blvd* Sawgrass Park 58,379 3rd AT&T N/A Cushman & Wake eld Biscayne Blvd Biscayne Corridor 56,780 4th N/A N/A Resorts World Miami LLC N Commerce Pky* Southwest Broward 51,863 4th Convey Health Solutions CBRE Sunbeam Properties, Inc. 8 1 SE 3rd Ave Downtown Miami 42,000 1st O ce of the Attorney General N/A Tower Commercial Real Estate NW 136th Ave* Sawgrass Park 39,813 2nd Core Logic JLL Cushman & Wake eld Sawgrass Corporate Pky Sawgrass Park 39,605 3rd N/A N/A Avison Young W Cypress Creek Rd Cypress Creek 39,250 4th N/A N/A Colliers International South Florid Sawgrass Corporate Pky* Sawgrass Park 38,037 2nd Fidelity National Information Services N/A Taylor & Mathis of Florida, LLC NW 12th St Sawgrass Park 37,209 4th N/A N/A CBRE NW 12th St Sawgrass Park 37,209 1st MEDNAX N/A Liberty Property Trust W Cypress Creek Rd Cypress Creek 36,471 4th N/A N/A Colliers International South Florid SW 148th Ave Southwest Broward 36,423 3rd N/A N/A Liberty Property Trust S Douglas Rd* Coral Gables 36,351 4th MasTec, Inc. Cushman & Wake eld Direct Deal SW 145th Ave Southwest Broward 36,290 2nd GMMI, Inc. N/A Duke Realty Corporation Universal Blvd* Southwest Broward 34,153 2nd TEVA Pharmaceuticals N/A ComReal Fort Lauderdale N Federal Hwy Fort Lauderdale 33,663 3rd CompHealth N/A Cushman & Wake eld NW 163rd St Miami Lakes 31,000 3rd Lufthansa N/A CBRE NW Corporate Blvd Boca Raton West 30,367 1st N/A N/A Avison Young NW 36th St* Miami Airport 30,000 3rd TSA Direct Deal Cushman & Wake eld Fairway Dr Pompano Beach 29,309 3rd All Star Recruiting Atlantic Commercial Group Cushman & Wake eld N Congress Ave West Palm Beach 28,792 1st State Fire Marshall Div N/A Cushman & Wake eld Village Blvd North Palm Beach 28,186 2nd N/A N/A John C. Bills Properties, Inc N Federal Hwy* Fort Lauderdale 26,276 2nd Intermedix Corporation Llc N/A N/A SW 26th St* Miami Airport 26,229 2nd San Antonio Medical Ctr N/A Morris Southeast Group, Inc Waterford Way Miami Airport 26,014 4th N/A N/A The Hogan Group N Biscayne Blvd* Downtown Miami 25,819 3rd Zyscovich Architects Cushman & Wake eld Blanca Commercial Real Estate, Inc NW 117th Ave Medley/Hialeah 25,504 2nd CVS N/A Blanca Commercial Real Estate, Inc S Biscayne Blvd Downtown Miami 25,472 2nd Zarco, Einhorn, Saokowski, & Brito N/A Taylor & Mathis of Florida, LLC S Douglas Rd* Coral Gables 25,162 4th MasTec Network Solutions Cushman & Wake eld Direct Deal Northpoint Pky North Palm Beach 23,700 3rd N/A N/A Kowerk Executive Suites N Federal Hwy Fort Lauderdale 23,026 2nd Envision RX Cushman & Wake eld Cushman & Wake eld NW 1st St Downtown Miami 23,000 2nd Ernst & Young U.S. LLP CBRE Blanca Commercial Real Estate, Inc S Pine Island Rd Plantation 22,649 2nd Quest Workspaces Newmark Grubb Knight Frank Avison Young SW 25th St Southwest Broward 21,872 1st Comcast Colliers International CBRE Brickell Ave Brickell 21,319 1st SITEL Worldwide Corporation JLL JLL US Highway 1* North Palm Beach 19,998 1st Nicklaus Design Newmark Grubb Knight Frank; Cushma N/A * Renewal 18 The CoStar Office Report 2016 CoStar Group, Inc.

25 Sales Activity The Optimist Sales Index Average of Two Highest Price/SF's and Two Lowest Cap Rates Per Quarter 7.0% Cap Rate Price/SF $740 $690 Cap Rate Percentage 5.0% 3.0% $640 $590 $540 $490 Dollars/SF 1.0% $ q q q $390 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 Oct Sept $1,000 Sales Volume Price/SF $300 Bldg Size # RBA $ Volume Price/SF Cap Rate Millions of Sales Volume Dollars $900 $800 $700 $600 $500 $400 $300 $200 $250 $200 $150 $100 $50 Price/SF < 50,000 SF 399 3,796,342 $779,811,821 $ % 50K-249K SF 250K-499K SF 58 6,332,909 $1,182,990,100 $ % 13 4,373,322 $1,226,550,377 $ % $100 $0 $0 >500K SF 1 652,366 $220,000,000 $ % q q q q 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 $320 South Florida US 9.0% South Florida US Dollars per SF $300 $280 $260 $240 $220 $200 $180 Cap Rate Percentage 8.0% 7.0% 5.0% $160 $ % $120 Source: CoStar COMPS q q q q Source: CoStar COMPS q q q q 2016 CoStar Group, Inc. The CoStar Office Report 19

26 20 The CoStar Office Report 2016 CoStar Group, Inc. South Florida Year-End 2016 Sales Activity