South Coast Commercial Real Estate Year-End Review

Transcription

1 HayesCommercial.com South Coast Commercial Real Estate Year-End Review GOLETA ISLA VISTA SANTA BARBARA MONTECITO SUMMERLAND CARPINTERIA Market Indicators 2015 Change Sales Transactions 97-6% Vacancy 3.3% -2% Asking Rates +3% Achieved Rates +3% Net Absorption Highlights 21,644 sf Change percentages and net absorption are since 1/1/2015. Figures above include all commercial property types. Commercial sales produced a fourth consecutive year of exceptional volume with 97 transactions totaling $478 million. s office vacancy plummeted from 14.6% to 1.7%, helping South Coast office vacancy dip below 7% for the first time since Retail leasing generated unprecedented volume of 83 retail leases securing more than 275,000 sf, although State Street is seeing elevated vacancy and turnover. COMMERCIAL SALES For the South Coast commercial sales market, 2015 marked the fourth consecutive year of exceptional volume. All told, the year produced 97 sales and maintained most of 2014 s unprecedented momentum. High demand from both investors and owner-users was met by sellers looking to capitalize on relatively elevated prices. While the dollar volume ($333 million, excluding hotels) was 9% lower than the prior year, it was still the second highest annual total on record. If there is ever going to be a golden age of commercial sales on the South Coast, we are probably in it now. Retail property sales volume exceeded $86 million, led by two transactions in downtown : the REI building at State St sold for $21.15 million, and the Saks Fifth Ave building at 1001 State St sold for $15.5 million in an off-market deal at the end of the year. Developers are busy on the South Coast these days. A plethora of projects are in varying degrees of completion in, including housing, retail and a hotel. On Upper State Street, the former Sandman Inn site at 3714 State St is being transformed into 73 residential condos and 5,000 sf of retail. Concurrently, a threestory, 89-unit apartment complex is well underway at State St. Given the challenges and costs of development on the South Coast, this level of construction indicates confidence in the local economy. The standout office property sale (and largest commercial sale) for the year was the 119,695 square foot oceanfront campus at Ave, sold for $25 million. Longtime home to CKE Restaurants, the property was purchased by an investor despite being 39% vacant. Six months later the property was fully leased. Three high-priced mixed-use properties were purchased in In addition to the two Icon projects in Isla Vista that sold for $38.5 million combined, the newly completed office/apartment property at 901 Olive St sold for $17.85 million. The appetite among investors for this asset class has rebounded significantly compared to six or seven years ago. Hotel properties with high-quality renovations are also finding buyers. The Canary Hotel at 27 W. Carrillo St sold for $78.4 million, providing a hefty return for the seller, who bought the property for $31.8 million in The Goodland Hotel at 5650 Calle Real, which was a Holiday Inn purchased for $24 million in 2013, is now a renovated, 158-room Kimpton hotel that fetched $40.9 million two years later. Looking ahead, the first question is what impact the recent increase in interest rates will have on demand. Given that the December increase had been anticipated and any additional increases in 2016 are expected to be incremental, we do not expect interest rates to significantly dampen demand in The second question is where we are on the 2016 Hayes Commerical Group

2 Year-End Review Page 2 South Coast Sales South Coast Leases price curve after several years of high volume. Looking at the price per square foot of commercial buildings sold in 2015, inflation-adjusted prices are 17% below 2007, which was the last market peak. At the same time, cap rates are in a range that leaves room for more price growth. Conditions are favoring another active year of sales. MULTIFAMILY SALES For a review of the apartment sales market, see page 9. OFFICE LEASING Office vacancy on the South Coast decreased slightly during 2015 and ended the year at 6.9%, the first dip below 7% since and both saw slight increases in inventory while s vacancy fell off a cliff. Expansion by local companies, most notably AppFolio and Procore, accounted for substantial absorption. Our brokers report strong activity and healthy demand for most office product. In terms of vacancy and pricing, the market looks a lot like it did in Downtown saw brisk activity in Notable renewals by Morgan Stanley Smith Barney and UBS were secured at relatively high rents, which landlords were able to negotiate largely due to the scarcity of comparable spaces on the market. Other tenants made flight to quality moves, including five leases that filled 22,488 sf of newly remodeled office space 801 Garden St, once occupied by Antioch University. The shared office concept is picking up steam downtown with Regus leasing 11,400 sf at 7 W. Figueroa St and ImpactHub laying claim to the 11,196 sf retail space at 1117 State St. The downtown market continues to be popular with internet companies, evidenced by RightScale s renewal of 26,339 sf at 402 E. Gutierrez St as well as leases by Local Market Launch, Bright Market (FastSpring), and LogicMonitor, to name a few. On the other end of town, CenCal Health expanded into the remaining 11,742 sf at 4050 Calle Real and now occupies the entire building. saw transaction volume and rental rates both on the rise in There were 42 leases signed, while achieved rates increased to $1.74 per SF. AppFolio had the South Coast s fastest growing real estate presence of any local company, gaining 32,000 sf at Castilian Tech Center. Despite the increase in activity, vacancy is still high at 10.4% in due to a series of moves by large tenants in recent years: Allergan and Mentor left the area, adding more than 200,000 sf of availability. Meanwhile, Flir and Citrix have been migrating into properties that they purchased for their operations. These moves have

3 Year-End Review Page 3 Office Vacancy: 6.9% Available Space: -8% Gross Absorption: +1% Asking Rates: +3% Achieved Rates: +3% Change percentages are since 1/1/2015. Figures are for the entire South Coast. vacated approximately 170,000 sf of space. As a result, the market has yet to absorb the glut of large spaces that are available, including 238,000 sf currently available in three buildings, which represents 46% of all available space. Flir has grown to approximately 500 employees in as it consolidates into its headquarters at 6769 Hollister Ave. Citrix Online is in the process of spinning off from Citrix Systems. The spin-off (yet to be named) will be headquartered at the 160,000 sf campus that Citrix owns at Hollister Ave and keep hundreds of high-tech jobs in for the foreseeable future. s office market was transformed in 2015, with more than 127,000 sf leased (a new high mark) and the vacancy rate plummeting from 14.6% at the end of 2014 to 1.7% (a new low mark). Three of the largest leases were existing tenants expanding: LinkedIn leased the entire 31,755 sf building at 1000 Mark Ave; Procore expanded into 28,310 sf at 6307 Ave; and PlanMember Services expanded into 12,350 sf at 6185 Ave. is a relatively small office market which is currently dominated by a handful of large tenants including LinkedIn, Agilent, and Procore which means if one of those tenants makes a move it will have a dramatic affect on overall vacancy. Looking ahead, we anticipate further tightening of vacancy across the South Coast in the first half of Demand for office space in will continue to be met with limited supply. In, finding tenants for the large available spaces will continue to be a challenge, but on the bright side the series of large spaces coming to market appears to be coming to a close, and demand for medium and small spaces is healthy. The near total absorption of s available office space in 2015 should limit leasing activity in the near term. The South Coast s 6.9% vacancy rate looks lean compared to neighboring Ventura County, which has vacancy in the 15% range. RETAIL LEASING Both in number of transactions and square footage, 2015 was the South Coast s biggest year for retail leasing in recent memory. There were 83 leases signed securing more than 275,000 sf. Given that vacancy was at a record low 1.8% at the beginning of the year, the deal volume that emerged was surprising. As one would expect with tight inventory and high transaction activity, rental rates have been on the rise. Achieved rates in have climbed 45% since the low point of the recession five years ago. However, they are still 9% below the pre-recession level in Thanks to 2015 leases, you can score hockey equipment at Centre Ice, pick up same-day purchases at the Amazon location in Isla Vista, get toned at Mad Fitness, slurp a bowl of Ramen at Sachi, and sip a locally-brewed beer at, well, take your pick. Marshall s renewed its lease on the 38,105 sf building at 900 State St, the year s largest deal in terms of square footage. Riding the national surge in automobile sales, after years of dormancy a new lease of the approximately 15,000 sf property at 350 S. Hitchcock Way is a Lexus dealership. Although it proved to be a strong leasing year for the South Coast as a whole, the prime retail corridor in downtown has been marked by relatively high vacancy and turnover, exacerbated by muted demand from national retailers. The 600 to 1000 blocks of State Street currently have nearly Retail Vacancy: 2.0% Available Space: +12% Gross Absorption: +21% Asking Rates: +5% Achieved Rates: +4% Change percentages are since 1/1/2015. Figures are for the entire South Coast. 30,000 sf of vacancy, the highest level since One factor contributing to this lull is the ascendency of other retail areas, especially the Funk Zone and Coast Village Road. Looking at wider trends, sluggish growth in consumer spending combined with the continuing shift in market share toward online purchases have made national retailers of soft goods (clothing and accessories)

4 Year-End Review Page 4 cautious about opening stores. Some industry analysts are citing a generational shift that is creating challenges for brick-and-mortar sellers of soft goods. In their view, compared to older generations, Millennials are not only more likely to buy merchandise online, they also tend to spend more of their discretionary income on leisure services such as restaurants, bars, travel and entertainment at the expense of soft goods. At the local level, most of the retail leases signed on the South Coast in 2015 were service-based concepts rather than soft goods. In addition, there were few leases by national retailers of any kind. Restaurant, wine and beer uses made up a large share of leases signed, in some cases spilling over into industrial space. Fitness and chiropractic uses were also well represented. Another trend among national retailers is experimenting with smaller stores, often combined with in-store pick-up service for merchandise purchased online. As a result, demand for larger retail spaces has been decreasing. In downtown, several large retail vacancies have been converted to satisfy high demand for office space. For example, 614 Chapala St was vacated by Samy s Camera and converted by Sonos into office space. Same with 419 State St, which was a Territory Ahead store. The former rug store at 1117 State St is slated to become ImpactHub, a shared office use. There are changes and new looks in progress at many of s malls and multi-tenant destinations. Paseo Nuevo is under new ownership with plans to increase the ratio of restaurants to soft goods stores, coupled with remodeling common areas, lighting, and signage. Now fully leased, The Mill at Laguna and Haley streets is home to numerous artisan tenants and ready to bring a refined variation on the Funk Zone aesthetic to the Haley Street corridor. The Public Market has been working through some growing pains as it adapts to its location and the challenges of taking a big-city concept and scaling it down for a small city. The restaurants at La Cumbre Plaza are in flux with Marmalade Café closing its doors within a few weeks of Lure opening for business. Despite the high volume of leasing, the South Coast s vacancy rate increased slightly in 2015 to 2.0% with a noticeable increase in vacancies on the prime blocks of State Street. Demand from national retailers for downtown space has been relatively soft, and we expect that to continue. Outside of the downtown core, local and regional operators have been driving healthy leasing activity. If the local economy continues its gradual improvement, we expect retail leasing to sustain momentum in INDUSTRIAL LEASING After four years of remarkably heavy industrial leasing volume, 2015 proved to be a slow year by comparison, with gross absorption down 48% from the prior year. The market dynamics in this sector have been fairly consistent for a few years. Inventory is very low with just 12 spaces available, and demand is high. South Coast vacancy is 1.6%, a level that has held steady for more than two years. During 2015 there were 57 leases signed, including 14 renewals. Gradual shifts in use have been accelerating demand in, where space that was traditionally purposed (and zoned) for manufacturing and warehouse uses has been leased to retail or office users. The City has also re-designated some manufacturingzoned property for high-density residential development. As a result, the industrial vacancy rate in Santa Barbara has been below 1% for more than two years and is currently 0.29%. There were only 15 leases completed in the lowest count in seven years and the average space size was 3,565 sf, which is the smallest average in at least ten years. The year s largest lease was 10,600 sf at 305 S. Calle Cesar Chavez Industrial by Riva Pacific. Vacancy: 1.6% There was a high volume of transactions in, though the bulk of the activity was smaller spaces, and year-over-year gross absorption decreased 33%. A few of the notable new Available Space: +7% Gross Absorption: -48% Asking Rates: -2% Achieved Rates: -2% Change percentages are since 1/1/2015. Figures are for the entire South Coast.

5 Year-End Review Page 5 leases were 14,276 sf at 6466 Hollister Ave signed by Motorsports and 9,500 sf at 460 Ward Dr secured by Deployable Space Systems. also produced a relatively large number of transactions, most of which were for spaces less than 5,000 sf, and gross absorption was down 26% compared to There was one sizable renewal of 24,030 sf at 6384 Via Real by Northrop Grumman. What effect has persistent low vacancy had on rents? Achieved rents on the South Coast have appreciated 20% over the last five years, and in the increase is 60%. To illustrate this trend in terms of dollars, consider a hypothetical tenant who signed a five-year lease in 2010 on a 5,000 sf industrial space in at the average 2010 rent. If they renewed their lease in 2015 at market value, their annual rent would be $37,200 more than it was in Demand has overcome minimal supply surprisingly well during most of the past three years, but the laws of economics are catching up with the industrial leasing market. Following a record year for gross absorption of industrial space, 2015 brought a 48% decrease in square footage leased. We expect another year of relatively modest industrial leasing, as the lack of inventory continues to constrict deal flow. To receive future Hayes Commercial Group reports electronically, please visit and subscribe. COMMERCIAL SALES 2015 Commercial Sales of Note Highest Priced Properties For Sale Ave, $25,000, Bath St, $18,400, State St, $21,150, Olive St, $17,850, S. Los Carneros Rd Office 105,257 sf $28,000, Pine Ave Office 83,479 sf $28,000, Hollister Ave Land 8.3 Acres $15,908, Navigator Way Office 46,430 sf $14,300, State St Office 77,368 sf $11,575, Castilian Dr Office/R&D 37,116 $9,200,000

6 Year-End Review Page 6 OFFICE LEASING Market Totals Available Change* Gross Absorption Change* Asking Rate Change* Achieved Rate Change* 219, % 390, % $ % $ % 472, % 352, % $ % $ % 11, % 127, % $ % $ % 704, % 871, % $ % $ % * Since 1/1/2015. Average rate totals are weighted by square footage. Office Vacancy vs. Achieved & Asking Rates Vacancy Rate Asking Rate Achieved Rate $3.00 8% $ % $ % $2.50 6% $ % $ % $ psf GR $2.00 $1.50 4% 2% Vacancy $ psf GR $1.50 $1.25 9% 7% Vacancy $ psf GR $1.25 $ % 5% Vacancy $ % $ % $ % 2015 Office Leases of Note Largest Available Spaces 326 Bollay Dr, 38,851 SF Inogen 6307 Ave, 28,310 SF Procore 1000 Mark Ave, 31,755 SF LinkedIn 402 E. Gutierrez St, 26,339 SF RightScale 71 S. Los Carneros Rd, 105,257 sf Allergan sublease 70 Castilian Dr, 86,246 sf in Castilian Tech Ctr 301 Mentor Dr, 70,282 sf in Mentor building 5425 Hollister Ave, 54,593 sf in Mentor building 27 E. Cota St, 31,000 sf Brooks sublease 7402 Hollister Ave, 28,015 sf in Hollister Business Park 5540 Ekwill St, 28,000 sf in Tech Ctr 55 Castilian Dr, 27,991 sf in Castilian Tech Ctr 6300 Lindmar Dr, 19,000 sf

7 Year-End Review Page 7 RETAIL LEASING Market Totals Available Change* Gross Absorption Change* Asking Rate Change* Achieved Rate Change* 218, % 202, % $ % $ % 66, % 69, % $ % $ % 12, % na na $ % na na 297, % 271, % $ % $ % * Since 1/1/2015. Average rate totals are weighted by square footage Retail Leases of Note Notable Available Spaces 7121 S. Hope Ave, 28,419 sf in La Cumbre Plaza 222 N. Milpas St, 22,000 sf Fresh Market sublease 7000 Hollister Ave, 19,425 sf in Hollister Village 900 State St, 38,105 SF Marshalls 6533 Trigo Rd, Isla Vista 2,751 SF Amazon 350 Hitchcock Way, 15,000 SF The Horowitz Group 717 State St, 1,822 SF SFO Forecast 5955 Calle Real, 10,715 sf SB Motorsports 3925 State St, 7,908 sf in 5 Points Center Calle Real Center, 7,476 sf in Calle Real Center 733 State St, 6,148 sf American Apparel 820 State St, 5,849 sf G By Guess 700 State St, 5,753 sf Panera Bread 2015 Retail Leases Sized According to Gross Rental Rate Victoria St Figueroa St Canon Perdido St State St Ortega St Haley St SCALE: $2.00/sf Gross $3.00/sf Gross $4.00/sf Gross $5.00/sf Gross Gross rental rate represented by the diameter of the circle.

8 Year-End Review Page 8 INDUSTRIAL LEASING Market Totals Available Change* Gross Absorption Change* Asking Rate Change* Achieved Rate Change* 13, % 53, % $ % $ % 125, % 131, % $ % $ % 28, % 89, % $ % $ % 168, % 275, % $ % $ % * Since 1/1/2015. Average rate totals are weighted by square footage. Industrial Vacancy vs. Asking & Achieved Rates Vacancy Rate Asking Rate Achieved Rate $ % $ % $ % $ % $1.50 8% $ % $ psf GR $1.50 $ % 1.0% Vacancy $ psf GR $1.25 $1.00 6% 4% Vacancy $ psf GR $1.25 $1.00 9% 6% Vacancy $ % $0.75 2% $0.75 3% $ % $ % $ % 2015 Industrial Leases of Note Largest Available Spaces 6384 Via Real, 24,030 SF Northrop Grumman 30 S. Calle Cesar Chavez, 10,600 SF Riva Pacific NW 6466 Hollister Ave, 14,276 SF SB Motorsports 460 Ward Dr, 9,500 SF Deployable Space Systems 7406 Hollister Ave, 52,855 sf 6385 Cindy Ln, 28,800 sf 5756 Thornwood Dr, 20,794 sf 749 Ward Dr, 17,200 sf 30 S. La Patera Ln, 11,467 sf 132 Robin Hill Rd, 11,059 sf 130 Los Aguajes Ave, 7,300 sf 75 Robin Hill Rd, 5,866 sf 1 N. Calle Cesar Chavez, 5,258 sf

9 Year-End Review Page 9 MULTIFAMILY SALES Following an unprecedented 29 sales in 2014, the number of sales in 2015 dropped to 18. The decrease wasn t for a lack of demand. Off-market sales represented 55% of the total, the highest proportion on record. The primary constraint was lack of inventory, and in nearly all cases of actively marketed properties, multiple offers were received. The seller s market persists, buoyed a surplus of tax deferred exchange buyers, continued increases in apartment rents, and lenders offering low interest rates. The elevated pricing seen in 2014 held steady, and many properties sold for well over $300K per door in Higher prices have placed downward pressure on cap rates, which decreased 20% percent to an average of 3.7%. The big story of the year was the purchase of three student housing properties in Isla Vista by the UC Regents with a combined price tag of $156 million. The sheer size of these apartment sales makes them statistical outliers in the context of the South Coast apartment market and will skew the data. Including the UC Regents purchases, the dollar volume of apartment sales increased dramatically from $137 million in 2014 to $206 million in With these three sales removed, the dollar volume for the South Coast was relatively subdued at $49 million. Looking ahead, we expect the basic market trends to continue. Properties are still attracting multiple offers; however, in 2015 the number of sales over the listing price decreased. With so few properties on the market, lack of sales is something to be vary of moving into Sales Price per Unit Cap Rate* GRM $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 7% 6% 5% 4% 4% 3% 2% 1% Average Price Per Unit Units Units 25+ Units Average Capitalization (Cap) Rate Units Units 25+ Units Average Gross Rent Multiplier (GRM) $212, % $225, % $292, % $284, % * Capitalization (Cap) Rate: net operating income divided by value or price. The yield of the property without reference to debt. Gross Rent Multiplier (GRM): value or price divided by annual gross operating income Units Units 25+ Units

10 SIGNIFICANT TRANSACTIONS by Hayes Commercial Group 2015 SALES 749 & 759 Ward Dr Industrial/Office 29,200 SF Listing Price: $4,250, E. Main St Santa Maria Retail 4,297 SF 300 S. Stratford Ave Santa Maria Medical 2,795 SF Listing Price: $1,250,000 Brokers: Bradford Ave Office 118,394 SF Listing Price: $32,500,000 Downtown Office Building Office 25,000± SF Brokers: Bartholomew, Martz, Roth 424 S. Patterson Ave Land/Office 24,419 SF Listing Price: $9,250, Lindmar Dr Office/Industrial 38,000 SF Listing Price: $7,250,00, DeJohn, Hayes 1219 State St Retail 13,050 SF Listing Price: $5,450, S. Bradley Rd Santa Maria Retail 46,610 SF Brokers: Martz 7230 Hollister Ave Office/Industrial 29,720 SF Listing Price: $4,178, Robin Hill Rd Office/Industrial 37,427 SF Listing Price: $4,950,000, DeJohn, Hayes 915 E. Anapamu St Land 40,055 SF 6790 Navigator War Office 9,334 SF Listing Price: $3,100, E. Haley St Industrial 4,384 SF Brokers: Bartholomew, Murphy 618 E. Gutierrez St Industrial 7,238 SF Listing Price: $2,200,000, Roth 450 Por La Mar Dr Apartment 6 Units Listing Price: $2,400,000 7 E. Anapamu St Retail/Restaurant 2,398 SF Listing Price: $2,125,000, Martz 1032 St & 208 E. Figuera St Office/Res Income 2,460 SF Listing Price: $1,925,000 Brokers: DeJohn, Roth 2245 Lillie Ave Summerland Land 1,296 SF Listing Price: $1,750, Overpass Rd Office 4,416 SF 2270 Lillie Ave Summerland Mixed-Use 2,550 SF Listing Price: $1,450,000, Martz, Roth 699 Linden Ave Retail 2,976 SF Listing Price: $1,575,000, Moll 1330 Cacique St Office 5,500 SF Listing Price: $1,395,000, DeJohn, Hayes, Ward 1376 Walter St Ventura Office 7,304 SF 1220 San Andres St Land/Res. Income 21,890 SF Listing Price: $1,095, Hollister Ave Retail 2,500 SF Brokers: Martz, Roth 23 Hitchcock Way Office 4,668 SF Listing Price: $950,000 Brokers: Bradford, DeJohn, Hayes 626 E. Gutierrez St Industrial 4,404 SF Listing Price: $895,000, Roth 217 W. Gutierrez St Office/Industrial 1,566 SF Listing Price: $395,000 Brokers: Martz, Ward

11 SIGNIFICANT TRANSACTIONS by Hayes Commercial Group 2015 LEASES 326 Bollay Dr Office 38,851 SF Inogen Brokers: Hayes, DeJohn 1740 Jones Way Oxnard Industrial 17,576 SF Rincon Technology, Roth 2720 De La Vina St Retail 4,000 SF Handlebar Coffee Roasters, Inc. Brokers: Martz 495 S. Fairview Ave Office 30,240 SF Plains All American Pipeline Brokers: Bartholomew 6307 Ave Office Suites 47,381 SF Various Tenants 801 Garden St Office Building 22,488 SF Various Tenants Brokers: Bartholomew, DeJohn, Hayes 55 Castilian Dr Office 20,051 SF FLIR, Roth 6305 Ave Office 20,000 SF ProCore 90 Castilian Dr Office 18,635 SF AppFolio Brokers: Bartholomew, DeJohn, Hayes 130 Robin Hill Rd Office 16,112 SF AECOM 6466 Hollister Ave Office 14,276 SF Motorsports Brokers: Bartholomew, DeJohn 120 Cremona Dr Office 13,313 SF Deckers Outdoor Corporation 1033 Anacapa St Office 12,939 SF American Riviera Bank Brokers: Bartholomew, Martz 823 E. Mason St Land 11,250 SF Boucher & Dollman 26 Castilian Dr Office 11,085 SF Hawk Applications Corp. Brokers: Hayes, DeJohn, Roth, Murphy 1351 Holiday Hill Rd Office/Industrial 10,485 SF Cubes, Inc. Brokers: Roth, C. Celmayster 130 Castilian Dr Office 10,484 SF Calient Brokers: Bartholomew, DeJohn, Hayes E. Haley St Retail Complex 3,069 SF Various Tenants Brokers: Bartholomew, Murphy 111 Castilian Dr Office/Industrial 10,200 SF Seek Thermal, Inc Brokers: Bartholomew 6464 Hollister Ave Land 10,080 SF Indian Orchard Trucking, Martz, Ward 460 Ward Dr Office/Industrial 9,500 SF Deployable Space Systems Brokers: Moll 1005 Mark Ave Industrial 9,250 SF Agilent Technologies Brokers: Moll, McCahill 619 Olive St Industrial/Retail 8,162 SF Goodman Reed Motorcars, LLC Brokers: Bartholomew, Celmayster 820 State St Retail 5,849 SF CitCo Enterprises, Inc., Martz 6533 Trigo Rd Isla Vista Retail 2,751 SF Amazon Brokers: Martz 116 St Industrial/Retail 2,400 SF Good Beer Company, LLC Brokers: Murphy 6530 Seville Rd Isla Vista Retail 1,970 SF Ike s Place, Inc. Brokers: Martz, McCahill, Roth 1187 Coast Village Rd Montecito Retail 1,620 SF The UPS Store 717 State St Retail 1,822 SF SFO Forecast. Inc. Brokers: Martz, Roth 1235 Coast Village Rd Montecito Retail/Office 1,084 SF Whistle Club, LLC Brokers: McCahill

12 Thank you! We wish to thank our clients for making 2015 our most successful year to date! We are grateful for the opportunity to help you achieve (and exceed) your real estate goals, and we look forward to serving you in 2016 and beyond results 34 SALES valued at $110 MILLION 250 LEASES totaling ONE MILLION SQ FT Commercial real estate done right. Since 1993 HayesCommercial.com Greg Bartholomew lic Michael Martz Paul Bradford lic Caitlin McCahill lic lic Christos Celmayster lic Dan Moll lic Francois DeJohn lic Liam Murphy lic Stephen Hayes lic Kristopher Roth lic Dylan Ward lic