AUSTIN OFFICE MARKET WATCH

Transcription

1 REAL ESTATE OUTLOOK OFFICE MARKET WATCH DECEMBER 217 Recent Office Leases OFFICE LEASE STATISTICS :: VACANCY & RENTAL RATE Southwest :: Gehan Homes (renew) 1,97 SF at Barton Creek Plaza III 25.% GROSS RENT PSF ($) VACANCY (%) $36. 2.% $32. East :: W2O Group Marketing 11,833 SF at 57 Calles Street 15.% $28. 1.% Southwest :: ARM (expansion) 2, SF at Encino Trace 1 5.% $24. CBD :: HNTB Corporation 14,51 SF at Austin Centre Recent Office Sales Round Rock :: Houghton Mifflin Harcourt 27 La Frontera Blvd. 97,311 SF 3-story value office building Buyer: Empire Square Group Seller: Redleaf Properties JV Live Oak.% All office buildings larger than 25, SF excluding government, medical, user campuses and office condos. Q3 217 Office Sales Statistics QUARTER TO DATE Q3 217 Volume ($ Mil) $2,414.9 $268.7 $342.8 $135,24.4 $28,422.4 No. of Properties ,833 1,356 Total SF 7,952,75 72,941 1,337,74 564,161, ,16,446 Average Price/SF $296 $458 $243 $255 $23 Average Cap Rate (Yield) 6.6% 6.1% N/A 6.7% 6.6% QTD $2. Monthly Office Lease Statistics By Submarket SOURCE: Real Capital Analytics SUBMARKET NO. OF BLDGS INVENTORY YTD NET ABSORPTION YTD LEASING ACTIVITY DIRECT OCCUP. TOTAL OCCUP. CLASS A NET RENT CLASS B NET RENT CLASS C NET RENT AVE NET RENT CBD 87 13,31, ,57 1,219, % 9.2% $4.99 $29.14 $26.83 $36.56 Central & West Central 8 5,459,728 (29,849) 355, % 94.% $3.91 $18.69 $18.2 $21.72 North 67 7,57, ,5 814, % 91.8% $32.5 $19.23 $15.47 $23.5 Northeast & East 73 6,1, , , % 82.7% $34.4 $23.1 $16.47 $24.23 Northwest & Far NW ,9,2 143,262 1,71, % 91.1% $23.75 $2.12 $16.4 $21.94 Round Rock & Cedar Park 46 2,97, ,57 147, % 91.9% $23.3 $17.75 $17.1 $19.7 South 43 2,922,39 11,2 28, % 95.2% $33.4 $22.98 $2.68 $25.2 Southeast 22 2,394,577 35,95 656,48 9.7% 9.7% $18.5 $16.78 $16.32 $16.75 Southwest ,44, ,15 1,418, % 89.% $26.76 $21.35 $17.72 $ ,529,918 1,842,49 6,259, % 9.3% $3.77 $21.1 $18.45 $25.5 SOURCE: Transwestern, CoStar

2 OFFICE MARKET WATCH DECEMBER 217 About Transwestern Transwestern is a privately held, SSAE 16 compliant commercial real estate firm specializing in agency leasing, property and facilities management, tenant advisory, capital markets, research and sustainability. The fully integrated global enterprise leverages competencies in office, industrial, retail, multifamily and healthcare properties to add value for investors, owners and occupiers of real estate. As a member of the Transwestern family of companies, the firm capitalizes on market insights and operational expertise of independent affiliates specializing in development, real estate investment management and research. Based in Houston, Transwestern has 34 offices and assists clients through more than 18 offices in 4 countries as part of a strategic alliance with Paris-based BNP Paribas Real Estate. For more information, please visit transwestern.com/austin and follow us on Seattle Minneapolis Boston San Francisco Walnut Creek Silicon Valley Denver Milwaukee Rosemont St. Louis Chicago Detroit Greenwich New York New Jersey Baltimore Bethesda Washington DC Northern Virginia Los Angeles Orange County San Diego Phoenix Fort Worth Oklahoma City Dallas Nashville Atlanta TRANSWESTERN LOCATIONS Austin San Antonio Houston New Orleans Orlando Austin Team Members Fort Lauderdale Miami Ty Puckett, Executive Vice President Development & Investment Sales (512) ty.puckett@transwestern.com Hale Umstattd, Executive Managing Director Investment Sales & Corp. Services (512) hale.umstattd@transwestern.com Scott Myers, Managing Director Investment Sales (512) scott.myers@transwestern.com Jeff Rogers, Managing Director Investment Sales - Multifamily (512) jeff.rogers@transwestern.com Chris Stutzman, Managing Director Investment Sales - Multifamily (512) chris.stutzman@transwestern.com Mike Brown, Senior Vice President Agency Leasing & Business Development (512) mike.brown@tranwestern.com Britt Reed, Senior Vice President Tenant Advisory (512) britt.reed@transwestern.com Greg Johnson, Vice President Agency Leasing (512) greg.johnson@transwestern.com Luke Wheeler, Vice President (512) luke.wheeler@transwestern.com Will Stewart, Vice President (512) will.stewart@transwestern.com Brandon Lester, Vice President (512) brandon.lester@transwestern.com Stayton Wright, Vice President Tenant Advisory (512) stayton.wright@transwestern.com Josh Delk, Vice President Development & Investment Sales (512) josh.delk@transwestern.com Nash Frisbie, Senior Associate (512) nash.frisbie@transwestern.com Tyler Gauntt, Associate Investment Sales - Multifamily (512) tyler.gauntt@transwestern.com Robert Gaston, Executive Vice President Southwest Regional Leader (512) robert.gaston@transwestern.com Karen Judson, Vice President Marketing & Research (512) CONTACT Karen Judson Vice President METHODOLOGY The information in this report is the result of a compilation of information on office properties located in the Austin metropolitan area. This report includes single-tenant and multi-tenant properties 25, SF and larger, excluding condo and medical office facilities and those properties owned and occupied by a government agency. Unless otherwise stated, the statistics in this report are monthly, meaning they reflect a snapshot in time and are not cumulative. Net Absorption refers to the change in vacant space. Gross Leasing Activity refers to the change in available space, including renewals, new leases, expansions and subleases. 91 S MoPac Expressway, Suite 4-25 Austin, Texas T Copyright 217 Transwestern. All rights reserved. No part of this work may be reproduced or distributed to third parties without written permission of the copyright owner. The information contained in this report was gathered by Transwestern from CoStar and other primary and secondary sources believed to be reliable. Transwestern, however, makes no representation concerning the accuracy or completeness of such information and expressly disclaims any responsibility for any inaccuracy contained herein.

3 REAL ESTATE OUTLOOK INDUSTRIAL MARKET WATCH DECEMBER 217 Recent Industrial Leases Southeast :: IXG Logistics 1,27 SF at Burleson Commerce Park 7 INDUSTRIAL LEASE STATISTICS :: VACANCY & RENTAL RATE NET RENT PSF ($) VACANCY (%) 2.% $1. Southeast :: Insco 14,4 SF at Expo 9 15.% $8. 1.% Round Rock :: GlassHouse Products 14,375 SF at Forest Commons Biz Park 3 5.% $6. Far Northwest :: Lot Vacuum 13, SF at Harris Ridge Business Center 1.% All Austin area industrial buildings larger than 5, SF excluding government and owner-occupied user campuses. QTD $4. Recent Industrial Sales South :: Woodbury Drive Warehouse Woodbury Drive 45,875 SF multitenant warehouse Buyer: Sendera Investment Group Seller: Paleo Ventures LTD Q3 217 Industrial Sales Statistics QUARTER TO DATE Q3 217 Volume ($ Mil) $384.1 $77.2 $215.9 $71,664.1 $23,25.4 No. of Properties ,8 1,861 Total SF 3,815, ,253 1,386,46 876,588,36 261,45,989 Average Price/SF $117 $159 N/A $81 $84 Average Cap Rate (Yield) 6.9% 6.5% N/A 6.8% 6.6% SOURCE: Real Capital Analytics Monthly Industrial Lease Statistics By Submarket SUBMARKET NO. OF BLDGS INVENTORY YTD NET ABSORPTION YTD LEASING ACTIVITY DIRECT OCCUP. TOTAL OCCUP. FLEX NET RENT WHSE NET RENT AVE NET RENT CBD & Central ,33 (12,131) 59, % 91.4% $14.37 $11.4 $13.81 Cedar Park & Far Northwest 83 2,696,797 53,453 92, % 88.9% $14.33 $1.6 $12.47 East 58 3,36, ,836 94,8 93.5% 93.5% $11.31 $9.6 $1.39 North 26 11,433,26 (585,921) 1,183, % 89.5% $11.27 $9.3 $9.81 Northeast 144 9,4,11 (142,358) 626, % 9.7% $12.51 $7.31 $9.49 Northwest 25 1,74,22 11,224 11,3 94.5% 94.1% $12.6 $9.4 $1.43 Round Rock & Far Northeast 215 6,23, , , % 9.7% $11.67 $9. $9.29 South ,141 6,231 34, % 98.3% $12. $9.6 $1.8 Southeast ,99,29 33,166 1,24, % 87.1% $11.13 $8.5 $9.22 Southwest 6 777,312 37,551 64, % 84.5% $13.62 $1.8 $12.7 1,58 48,332,328 13,912 3,665, % 89.8% $11.97 $8.75 $9.84 SOURCE: Transwestern, CoStar

4 INDUSTRIAL MARKET WATCH DECEMBER 217 About Transwestern Transwestern is a privately held, SSAE 16 compliant commercial real estate firm specializing in agency leasing, property and facilities management, tenant advisory, capital markets, research and sustainability. The fully integrated global enterprise leverages competencies in office, industrial, retail, multifamily and healthcare properties to add value for investors, owners and occupiers of real estate. As a member of the Transwestern family of companies, the firm capitalizes on market insights and operational expertise of independent affiliates specializing in development, real estate investment management and research. Based in Houston, Transwestern has 34 offices and assists clients through more than 18 offices in 4 countries as part of a strategic alliance with Paris-based BNP Paribas Real Estate. For more information, please visit transwestern.com/austin and follow us on Seattle Minneapolis Boston San Francisco Walnut Creek Silicon Valley Denver Milwaukee Rosemont St. Louis Chicago Detroit Greenwich New York New Jersey Baltimore Bethesda Washington DC Northern Virginia Los Angeles Orange County San Diego Phoenix Fort Worth Oklahoma City Dallas Nashville Atlanta TRANSWESTERN LOCATIONS Austin San Antonio Houston New Orleans Orlando Austin Team Members Fort Lauderdale Miami Ty Puckett, Executive Vice President Development & Investment Sales (512) ty.puckett@transwestern.com Hale Umstattd, Executive Managing Director Investment Sales & Corp. Services (512) hale.umstattd@transwestern.com Scott Myers, Managing Director Investment Sales (512) scott.myers@transwestern.com Jeff Rogers, Managing Director Investment Sales - Multifamily (512) jeff.rogers@transwestern.com Chris Stutzman, Managing Director Investment Sales - Multifamily (512) chris.stutzman@transwestern.com Mike Brown, Senior Vice President Agency Leasing & Business Development (512) mike.brown@tranwestern.com Britt Reed, Senior Vice President Tenant Advisory (512) britt.reed@transwestern.com Greg Johnson, Vice President Agency Leasing (512) greg.johnson@transwestern.com Luke Wheeler, Vice President (512) luke.wheeler@transwestern.com Will Stewart, Vice President (512) will.stewart@transwestern.com Brandon Lester, Vice President (512) brandon.lester@transwestern.com Stayton Wright, Vice President Tenant Advisory (512) stayton.wright@transwestern.com Josh Delk, Vice President Development & Investment Sales (512) josh.delk@transwestern.com Nash Frisbie, Senior Associate (512) nash.frisbie@transwestern.com Tyler Gauntt, Associate Investment Sales - Multifamily (512) tyler.gauntt@transwestern.com Robert Gaston, Executive Vice President Southwest Regional Leader (512) robert.gaston@transwestern.com Karen Judson, Vice President Marketing & Research (512) CONTACT Karen Judson Vice President METHODOLOGY The information in this report is the result of a compilation of information on industrial properties located in the Austin metropolitan area. This report includes Class A & B single-tenant and multi-tenant industrial properties 5, SF and larger, excluding owner-occupied user campuses and those properties owned and occupied by a government agency. Unless otherwise stated, the statistics in this report are monthly, meaning they reflect a snapshot in time and are not cumulative. Net Absorption refers to the change in vacant space. Gross Leasing Activity refers to the change in available space, including renewals, expansions, new leases and subleases. 91 S MoPac Expressway, Suite 4-25 Austin, Texas T Copyright 217 Transwestern. All rights reserved. No part of this work may be reproduced or distributed to third parties without written permission of the copyright owner. The information contained in this report was gathered by Transwestern from CoStar and other primary and secondary sources believed to be reliable. Transwestern, however, makes no representation concerning the accuracy or completeness of such information and expressly disclaims any responsibility for any inaccuracy contained herein.

5 REAL ESTATE OUTLOOK RETAIL MARKET WATCH DECEMBER 217 Recent Retail Leases RETAIL LEASE STATISTICS :: VACANCY & RENTAL RATE NET RENT PSF ($) 8.% 8.% North :: Fortiline 14,2 SF at 611 East Braker Lane VACANCY (%) $25. $25. 6.% 6.% $2. $2. Cedar Park :: Soccer Station 5,791 SF at The Research & 45 4.% 4.% $15. $15. 2.% 2.% Recent Retail Sales.%.% Hays County :: Kyle Crossing 541 South FM ,465 SF grocery anchored power center Buyer: InvenTrust Seller: Blackstone JV DDR South :: Tejas Business Park 442 South Congress Avenue 18,192 unanchored shopping center Buyer: Ronald & Katrina Stanley Seller: Michael & Lauren Smith NO. OF BLDGS 17 $1. $1. All Austin area retail buildings larger than 25, SF. Retail Sales Statistics Volume ($ Mil) No. of Properties Q3 217 QUARTER TO DATE Q3 217 $894.4 $259.7 $39.1 $67,54. $14, ,864 1,627 16, ,624 78,275,17 3,834, ,496 Average Price/SF $296 $272 N/A Average Cap Rate (Yield) 6.1% 5.4% N/A Total SF $185 $ % 6.6% SOURCE: Real Capital Analytics Monthly Retail Lease Statistics By Submarket* SUBMARKET QTD INVENTORY YTD NET ABSORPTION YTD LEASING ACTIVITY DIRECT OCCUPANCY TOTAL OCCUPANCY AVERAGE NET RENT 1,826,593 28,94 27, % 98.6% $39. Central Business District (CBD) 63 Central & West Central 23 7,368,276 (184,119) 138, % 93.5% $22.33 Cedar Park & Far Northwest 249 1,836, , , % 95.1% $23.3 East & Northeast 15 5,62,37 58, , % 95.5% $21. Hays County 26 7,832,673 33, , % 98.% $24.2 North 163 6,599,219 (26,241) 99, % 96.5% $18.57 Northwest 129 4,841,436 38,251 13, % 96.5% $22.97 Round Rock & Far Northeast 254 9,632, ,67 266, % 94.8% $21.66 South & Southeast ,831,818 (86,693) 19, % 97.3% $23.8 Southwest 188 1,925 7,973,666 9,1 152, % 97.7% $ ,344, ,493 1,674, % 96.2% $23.31 *Starting in Q3 217, the building size tracked has been lowered from 25, SF to 1, SF for inclusion in this report. We also added Hays County. SOURCE: Transwestern, CoStar

6 RETAIL MARKET WATCH DECEMBER 217 About Transwestern Transwestern is a privately held, SSAE 16 compliant commercial real estate firm specializing in agency leasing, property and facilities management, tenant advisory, capital markets, research and sustainability. The fully integrated global enterprise leverages competencies in office, industrial, retail, multifamily and healthcare properties to add value for investors, owners and occupiers of real estate. As a member of the Transwestern family of companies, the firm capitalizes on market insights and operational expertise of independent affiliates specializing in development, real estate investment management and research. Based in Houston, Transwestern has 34 offices and assists clients through more than 18 offices in 4 countries as part of a strategic alliance with Paris-based BNP Paribas Real Estate. For more information, please visit transwestern.com/austin and follow us on Seattle Minneapolis San Francisco Walnut Creek Silicon Valley Boston Milwaukee Rosemont Chicago Detroit Denver Baltimore Bethesda Washington DC Northern Virginia St. Louis Los Angeles Orange County San Diego Phoenix Greenwich New York New Jersey Nashville TRANSWESTERN LOCATIONS Oklahoma City Atlanta Fort Worth Dallas New Orleans Austin San Antonio Houston Orlando Fort Lauderdale Miami Austin Team Members Ty Puckett, Executive Vice President Hale Umstattd, Executive Managing Director Scott Myers, Managing Director Jeff Rogers, Managing Director Chris Stutzman, Managing Director Mike Brown, Senior Vice President Britt Reed, Senior Vice President Greg Johnson, Vice President Luke Wheeler, Vice President Will Stewart, Vice President Brandon Lester, Vice President Stayton Wright, Vice President Josh Delk, Vice President Nash Frisbie, Senior Associate Tyler Gauntt, Associate Robert Gaston, Executive Vice President Karen Judson, Vice President Development & Investment Sales Investment Sales & Corp. Services Investment Sales Investment Sales - Multifamily Investment Sales - Multifamily Agency Leasing & Business Development Tenant Advisory Agency Leasing Tenant Advisory Development & Investment Sales Investment Sales - Multifamily Southwest Regional Leader Marketing & Research (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) ty.puckett@transwestern.com hale.umstattd@transwestern.com scott.myers@transwestern.com jeff.rogers@transwestern.com chris.stutzman@transwestern.com mike.brown@tranwestern.com britt.reed@transwestern.com greg.johnson@transwestern.com luke.wheeler@transwestern.com will.stewart@transwestern.com brandon.lester@transwestern.com stayton.wright@transwestern.com josh.delk@transwestern.com nash.frisbie@transwestern.com tyler.gauntt@transwestern.com robert.gaston@transwestern.com CONTACT METHODOLOGY Karen Judson Vice President The information in this report is the result of a compilation of information on retail properties located in the Austin metropolitan area. This report includes single-tenant and multi-tenant properties 1, SF and larger. Unless otherwise stated, the statistics in this report are monthly, meaning they reflect a snapshot in time and are not cumulative. Net Absorption refers to the change in vacant space. Gross Leasing Activity refers to the change in available space, including renewals, new leases, expansions and subleases. 91 S MoPac Expressway, Suite 4-25 Austin, Texas T Copyright 217 Transwestern. All rights reserved. No part of this work may be reproduced or distributed to third parties without written permission of the copyright owner. The information contained in this report was gathered by Transwestern from CoStar and other primary and secondary sources believed to be reliable. Transwestern, however, makes no representation concerning the accuracy or completeness of such information and expressly disclaims any responsibility for any inaccuracy contained herein.

7 REAL ESTATE OUTLOOK APARTMENT MARKET WATCH DECEMBER 217 Recent Apartment Sales APARTMENT STATISTICS :: VACANCY & RENTAL RATE San Marcos :: Cedars of San Marcos 168 Units at 111 Leah Avenue Buyer: Railfield Seller: Leah Drive BIG 22 LLC 15.% RENT PSF ($) VACANCY (%) $1.4 $1.3 1.% $1.2 Northeast :: Cedar Creek Estates 4 Units at 851 Cameron Road Buyer: OTH Fund 1 LP Seller: Rick A Patterson 5.% $1.1 $1. $.9 San Marcos :: The Curve at River Road 116 Units at 75 River Road Buyer: Railfield Seller: Undisclosed Central :: Spanish Trail 4 Units at 452 Bennett Avenue Buyer: Armadillo Spanish Trails Realty Seller: 512 Realty Monthly Apartment Statistics MSA OCTOBER 217 ANNUAL CHANGE (%) Occupancy 9.5% (.4%) Units Added 8,546 N/A Units Absorbed (Annual) 7,74 N/A Average Size (SF) 858.1% Average Asking Rent (Unit) $1,221 (.3%) Average Asking Rent PSF $1.42 (.3%) Average Effective Rent (Unit) $1,23 (.3%) Average Effective Rent PSF $1.4 (.4%) % Offering Concessions 21% 31.% Average Concession Package 5.9 (4.8%) SOURCE: ALN Apartment Data.% Q3 217 :: Apartment Statistics By Submarket SUBMARKET UNITS OCCUP- ANCY CLASS A RENT PSF CLASS B RENT PSF CLASS C RENT PSF $.8 SOURCE: Austin Investor Interests, ALN Apartment Data AVE RENT PSF Bastrop (BAS) % $1.32 $1.19 $.86 $1.11 Central (C) 5, % $1.92 $1.81 $1.62 $1.8 Central Bus. District (CBD) 4, % $2.76 $2.15 $1.91 $2.59 Cedar Park/Leander (CP/L) 8, % $1.34 $1.13 $1.13 $1.24 East (E) % $1.5 - $1.8 $1.8 East Central (EC) 4, % $1.96 $1.72 $1.76 $1.92 Hays (Hays) 2, % $ $1.34 North (N) 2, % $1.41 $1.26 $1.26 $1.28 North Central (NC) 7, % $1.82 $1.52 $1.32 $1.62 Northeast (NE) 12, % $1.32 $1.22 $1.25 $1.26 Northeast Central (NEC) 4, % - $1.19 $1.2 $1.2 Northwest (NW) 28, % $1.44 $1.23 $1.26 $1.27 Northwest Central (NWC) 5, % - $1.48 $1.35 $1.39 Round Rock (RR) 11, % $1.24 $1.19 $1.22 $1.22 South (S) 13, % $1.43 $1.28 $1.42 $1.36 South Central (SC) 12, % $2.19 $1.65 $1.64 $1.84 Southeast (SE) 4, % $1.33 $1.29 $1.23 $1.29 Southeast Central (SEC) 12, % $1.88 $1.37 $.13 $1.45 San Marcos (SM) 5, % $1.39 $1.35 $1.2 $1.29 Southwest (SW) 8,2 92.9% $1.44 $1.37 $.91 $1.39 UT (UT) 1, % $2.27 $2.1 $1.87 $2.1 West (W) 4, % $1.45 $1.27 $1.66 $1.38 Williamson (WMS) 3, % $1.36 $1.18 $1.41 $1.28 TRAVIS COUNTY ONLY 141, % $1.73 $1.33 $1.36 $1.46 MSA (TOTAL) 182, % $1.62 $1.29 $1.34 $1.41 Does not inlcude 2,676 units of affordable housing and 11,747 units of student housing. If all types are added together, the Austin MSA totals 214,797 units. SOURCE: Austin Investor Interests QTD

8 APARTMENT MARKET WATCH DECEMBER 217 Apartment Sales Statistics Q3 217 QUARTER TO DATE Q3 217 Volume ($ Mil) $3,55.4 $382.3 $595.1 $15,451.9 $4,8.1 No. of Properties ,31 2,4 Total Units 23,896 2,757 4,125 1,118, ,351 Average Price/Unit $156,659 $115,641 $115,835 $145,435 $15,534 Average Cap Rate (Yield) 5.5% 5.6% N/A 5.6% 5.4% SOURCE: Real Capital Analytics About Transwestern Transwestern is a privately held, SSAE 16 compliant commercial real estate firm specializing in agency leasing, property and facilities management, tenant advisory, capital markets, research and sustainability. The fully integrated global enterprise leverages competencies in office, industrial, retail, multifamily and healthcare properties to add value for investors, owners and occupiers of real estate. As a member of the Transwestern family of companies, the firm capitalizes on market insights and operational expertise of independent affiliates specializing in development, real estate investment management and research. Based in Houston, Transwestern has 34 offices and assists clients through more than 18 offices in 4 countries as part of a strategic alliance with Paris-based BNP Paribas Real Estate. For more information, please visit transwestern.com/ austin and follow us on Austin Team Members Ty Puckett, Executive Vice President Development & Investment Sales (512) ty.puckett@transwestern.com Hale Umstattd, Executive Managing Director Investment Sales & Corp. Services (512) hale.umstattd@transwestern.com Scott Myers, Managing Director Investment Sales (512) scott.myers@transwestern.com Jeff Rogers, Managing Director Investment Sales - Multifamily (512) jeff.rogers@transwestern.com Chris Stutzman, Managing Director Investment Sales - Multifamily (512) chris.stutzman@transwestern.com Mike Brown, Senior Vice President Agency Leasing & Business Development (512) mike.brown@tranwestern.com Britt Reed, Senior Vice President Tenant Advisory (512) britt.reed@transwestern.com Greg Johnson, Vice President Agency Leasing (512) greg.johnson@transwestern.com Luke Wheeler, Vice President (512) luke.wheeler@transwestern.com Will Stewart, Vice President (512) will.stewart@transwestern.com Brandon Lester, Vice President (512) brandon.lester@transwestern.com Stayton Wright, Vice President Tenant Advisory (512) stayton.wright@transwestern.com Josh Delk, Vice President Development & Investment Sales (512) josh.delk@transwestern.com Nash Frisbie, Senior Associate (512) nash.frisbie@transwestern.com Tyler Gauntt, Associate Investment Sales - Multifamily (512) tyler.gauntt@transwestern.com Robert Gaston, Executive Vice President Southwest Regional Leader (512) robert.gaston@transwestern.com Karen Judson, Vice President Marketing & Research (512) CONTACT Karen Judson Vice President METHODOLOGY The statistics included in this report are the result of a compilation of information on apartment properties containing 5 or more units located in the Austin metropolitan area. Unless otherwise stated, the statistics in this report are monthly, meaning they reflect a snapshot in time and are not cumulative. 91 S MoPac Expressway, Suite 4-25 Austin, Texas T Copyright 217 Transwestern. All rights reserved. No part of this work may be reproduced or distributed to third parties without written permission of the copyright owner. The information contained in this report was gathered by Transwestern from CoStar and other primary and secondary sources believed to be reliable. Transwestern, however, makes no representation concerning the accuracy or completeness of such information and expressly disclaims any responsibility for any inaccuracy contained herein.

9 REAL ESTATE OUTLOOK MEDICAL OFFICE MARKET WATCH DECEMBER 217 Austin Area Hospital Statistics MEDICAL OFFICE STATISTICS :: VACANCY & RENTAL RATE Number of practicing physicians Travis County 3,582 Williamson County 741 Number of hospitals Travis County Williamson County NET RENT PSF ($) 19 9 $25. 1.% $22. 5.% $19..% 2, QTD Number of staffed beds Travis County Williamson County VACANCY (%) 15.% $16. SOURCES: Transwestern, CoStar Monthly Medical Office Lease Statistics By Submarket SUBMARKET NO. OF BLDGS INVENTORY YTD NET ABSORPTION YTD LEASING ACTIVITY UNDER CONSTRUCTION DIRECT OCCUPANCY TOTAL OCCUPANCY MEDICAL OFFICE AVERAGE NET RENT CBD 5 31, , % 98.5% $32. Cedar Park 67 1,115,348 28,273 52,393 11,2 92.% 91.8% $23.83 Central 76 2,271,328 (36,949) 38, % 94.7% $29.5 East ,383 (8,5) 98.5% 98.5% $24.25 Far Northeast ,51 (1,14) 7,449 5, 9.5% 82.4% $22.73 Far Northwest ,116 (27,87) 7, % 82.8% $18.58 Georgetown ,496 14,691 5, % 97.4% $22.87 Hays County 52 3,12,416 26,846 39, % 97.1% $22.6 North ,569 (41,682) 11, % 91.8% $28.5 Northeast 3 191,81 1.% 1.% $19.57 Northwest 69 2,144,623 (3,631) 62, % 92.8% $23.2 Round Rock 57 1,296,86 87,189 43,394 1, 9.6% 9.2% $2.29 South 83 1,228,964 15,26 56, % 97.4% $25.89 Southeast 9 386,177 (138) 98.3% 98.3% $22.11 Southwest 78 1,975,92 99,848 13,63 246, % 89.% $28.4 West Central ,455 (62) 22, % 91.2% $26. MSA ,32,78 152, ,457 47, % 93.6% $24.86 The above statistics include buildings that are specifically designated as medical office, as well as traditional office buildings with a majority of medical office tenants and uses that conform to medical office standards. These statistics do not include retail buildings that contain medical office tenants. It is estimated that as much as 2% of medical office tenants are currently leasing space in retail centers, however retail space is not specifically marketed for medical office use and is therefore difficult to accurately track. Sources: Transwestern, CoStar, Revista

10 MEDICAL OFFICE MARKET WATCH DECEMBER 217 LIST OF -AREA HOSPITALS AND NUMBER OF STAFFED BEDS Arise Austin Medical Center 19 Baylor Scott & White Cedar Park Baylor Scott & White Round Rock 8 11 Northwest Hills Surgical Hospital 8 St. David's Medical Center 433 St. David's North Austin Medical Center 378 Reliant Austin 6 St. David's Rehabilitation Center Reliant Rehabilitation Hospital 75 St. David s Round Rock Medical Center Ascension Seton Med. Ctr Austin 53 St. David s South Austin Medical Center Ascension Seton Med. Ctr Wmsn 149 Texas NeuroRehab Center 54 Ascension Seton NW Hospital 117 The Hospital at Westlake Medical Center Ascension Seton SWHospital 33 University Medical Center Brakenridge 339 St. David s Georgetown Med. Ctr. 98 Vibra Rehabilitation Hospital Lake Travis 36 Central Texas Rehabilitation Hospital Cornerstone Hospital of Round Rock Dell Children's Hospital Cedar Park Regional Medical Center Cornerstone Hospital of Austin Heart Hospital of Austin HealthSouth Rehabilitation Hospital SOURCE: Texas Hospital Board About Transwestern Transwestern is a privately held, SSAE 16 compliant commercial real estate firm specializing in agency leasing, property and facilities management, tenant advisory, capital markets, research and sustainability. The fully integrated global enterprise leverages competencies in office, industrial, retail, multifamily and healthcare properties to add value for investors, owners and occupiers of real estate. As a member of the Transwestern family of companies, the firm capitalizes on market insights and operational expertise of independent affiliates specializing in development, real estate investment management and research. Transwestern has 34 offices and assists clients through more than 181 offices in 4 countries as part of a strategic alliance with Paris-based BNP Paribas Real Estate. For more information, please visit transwestern.com/austin and follow us on Austin Team Members Ty Puckett, Executive Vice President Hale Umstattd, Executive Managing Director Scott Myers, Managing Director Jeff Rogers, Managing Director Chris Stutzman, Managing Director Mike Brown, Senior Vice President Britt Reed, Senior Vice President Greg Johnson, Vice President Luke Wheeler, Vice President Will Stewart, Vice President Brandon Lester, Vice President Stayton Wright, Vice President Josh Delk, Vice President Nash Frisbie, Senior Associate Tyler Gauntt, Associate Robert Gaston, Executive Vice President Karen Judson, Vice President Development & Investment Sales Investment Sales & Corp. Services Investment Sales Investment Sales - Multifamily Investment Sales - Multifamily Agency Leasing & Business Development Tenant Advisory Agency Leasing Tenant Advisory Development & Investment Sales Investment Sales - Multifamily Southwest Regional Leader Marketing & Research (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) (512) ty.puckett@transwestern.com hale.umstattd@transwestern.com scott.myers@transwestern.com jeff.rogers@transwestern.com chris.stutzman@transwestern.com mike.brown@tranwestern.com britt.reed@transwestern.com greg.johnson@transwestern.com luke.wheeler@transwestern.com will.stewart@transwestern.com brandon.lester@transwestern.com stayton.wright@transwestern.com josh.delk@transwestern.com nash.frisbie@transwestern.com tyler.gauntt@transwestern.com robert.gaston@transwestern.com CONTACT METHODOLOGY Karen Judson Vice President The information in this report is the result of a compilation of data on medical office and office properties that have a majority of medical office tenants, located in the Austin metropolitan area. It does not include retail space leased or utilized as medical office. Unless otherwise stated, the statistics in this report are monthly, meaning they reflect a snapshot in time and are not cumulative. Net Absorption refers to the change in vacant space. Gross Leasing Activity refers to the change in available space, including renewals, new leases, expansions, downsizes and subleases. 91 S MoPac Expressway, Suite 4-25 Austin, Texas T Copyright 217 Transwestern. All rights reserved. No part of this work may be reproduced or distributed to third parties without written permission of the copyright owner. The information contained in this report was gathered by Transwestern from CoStar and other primary and secondary sources believed to be reliable. Transwestern, however, makes no representation concerning the accuracy or completeness of such information and expressly disclaims any responsibility for any inaccuracy contained herein.

11 REAL ESTATE OUTLOOK ECONOMY MARKET WATCH DECEMBER 217 Austin Employment By Industry (Trailing 12 Months) INDUSTRY (NON FARM) OCT 217 OCT 216 % GROWTH Mining, Logging & Construction 63, 6,2 4.7% Manufacturing 58,2 55,4 5.1% Trade, Transportation & Utilities 175,2 172,4 1.6% Information 27,4 28,6-4.2% Financial Services 58,4 58,3.2% Professional & Business Services 171,8 171,8.% Education & Health Services 124, 119, 4.2% Leisure & Hospitality 129,2 123,2 4.9% Other Services 45,6 44,7 2.% Government 183,8 18,8 1.7% TOTAL 1,36,6 1,14,4 2.2% Industry Composition Austin MSA Other Services 4% Leisure & Hospitality 12% Government 18% Educational & Health Services 12% Professional & Business Services 16% SOURCE: Texas Workforce Commission Mining, Logging & Construction 6% Trade, Transportation & Utilities 17% Manufacturing 6% Financial Services 6% Information 3% Unemployment Rate MSA TEXAS Year-End % 8.3% 9.4% Year-End % 7.2% 8.3% Year-End % 6.1% 7.8% Year-End % 5.6% 6.5% Year-End % 4.1% 5.4% Year-End % 4.2% 4.8% Year-End % 4.6% 4.5% October % 3.5% 3.9% SOURCE: Texas Workforce Commission, Bureau of Labor Statistics Population YEAR-END MSA TEXAS 21 1,716,289 25,145,562 38,745, ,783,519 25,674, ,591, ,836,149 26,6, ,873, ,885,83 26,448, ,128, ,943,299 24,956,958 32,355, ,2,86 27,469, ,418, ,56,45 27,862, ,127,513 SOURCE: Texas A&M REal Estate Center, US Census Bureau Average Home Prices :: October 217 MSA TEXAS Average Price $366,328 $268,993 $288,4 Median Price $285,4 $219,99 $247, Mo. of Inventory SOURCE: MLS Austin, Greater Austin Chamber of Commerce Key Indicators This information is current as of the publication date of this report. If you need up-to-the-minute, real-time numbers for any or all of these key indicators, visit the WSJ Market Data Center by clicking this link: usoverview 52 Wk 52 Wk High Low DJIA NASDAQ S&P Prime Rate Money Mkt Wk 52 Wk High Low 3 Yr Fixed Yr Fixed Yr ARM Jumbo Fannie Mae

12 ECONOMY MARKET WATCH DECEMBER 217 BUILDING PERMITS ISSUED :: MSA About Transwestern 2, 1,5 1, 5 PERMITS: SINGLE FAMILY 2Q16 1Q16 4Q15 3Q16 PERMITS: MULTIFAMILY 3Q17 2Q17 1Q17 4Q16 SOURCE: Texas A&M Real Estate Center Transwestern is a privately held, SSAE 16 compliant commercial real estate firm specializing in agency leasing, property and facilities management, tenant advisory, capital markets, research and sustainability. The fully integrated global enterprise leverages competencies in office, industrial, retail, multifamily and healthcare properties to add value for investors, owners and occupiers of real estate. As a member of the Transwestern family of companies, the firm capitalizes on market insights and operational expertise of independent affiliates specializing in development, real estate investment management and research. Based in Houston, Transwestern has 34 offices and assists clients through more than 18 offices in 4 countries as part of a strategic alliance with Paris-based BNP Paribas Real Estate. For more information, please visit transwestern.com/austin and follow us on Austin Team Members Ty Puckett, Executive Vice President Development & Investment Sales (512) ty.puckett@transwestern.com Hale Umstattd, Executive Managing Director Investment Sales & Corp. Services (512) hale.umstattd@transwestern.com Scott Myers, Managing Director Investment Sales (512) scott.myers@transwestern.com Jeff Rogers, Managing Director Investment Sales - Multifamily (512) jeff.rogers@transwestern.com Chris Stutzman, Managing Director Investment Sales - Multifamily (512) chris.stutzman@transwestern.com Mike Brown, Senior Vice President Agency Leasing & Business Development (512) mike.brown@tranwestern.com Britt Reed, Senior Vice President Tenant Advisory (512) britt.reed@transwestern.com Greg Johnson, Vice President Agency Leasing (512) greg.johnson@transwestern.com Luke Wheeler, Vice President (512) luke.wheeler@transwestern.com Will Stewart, Vice President (512) will.stewart@transwestern.com Brandon Lester, Vice President (512) brandon.lester@transwestern.com Stayton Wright, Vice President Tenant Advisory (512) stayton.wright@transwestern.com Josh Delk, Vice President Development & Investment Sales (512) josh.delk@transwestern.com Nash Frisbie, Senior Associate (512) nash.frisbie@transwestern.com Tyler Gauntt, Associate Investment Sales - Multifamily (512) tyler.gauntt@transwestern.com Robert Gaston, Executive Vice President Southwest Regional Leader (512) robert.gaston@transwestern.com Karen Judson, Vice President Marketing & Research (512) CONTACT Karen Judson Vice President METHODOLOGY The information in this report is the result of a compilation of publicly available data from a variety of commercial and government sources. 91 S MoPac Expressway, Suite 4-25 Austin, Texas T Copyright 217 Transwestern. All rights reserved. No part of this work may be reproduced or distributed to third parties without written permission of the copyright owner. The information contained in this report was gathered by Transwestern from CoStar and other primary and secondary sources believed to be reliable. Transwestern, however, makes no representation concerning the accuracy or completeness of such information and expressly disclaims any responsibility for any inaccuracy contained herein.