LIFE SCIENCE & CLEANTECH

LIFE SCIENCE & CLEANTECH San Francisco Bay Area Real Estate Market Review 3rd Quarter 2010 M arket activity slowed dramatically as compared to the 2nd quarter; but there were still over 500,000 square feet of gross absorption during the 3rd quarter. On a positive note, there were leases completed in all submarkets, with the largest activity in North San Mateo County. GVA Kidder Mathews is tracking 48 companies looking for close to 1,500,000 square feet of space, down about 600,000 square feet from the 2nd quarter. We have experienced a slight increase in vacancy throughout the San Francisco Bay Region in the 3rd quarter. We are anticipating a significant increase in leasing activity in the 4th quarter. Overall San Market Rafael Summary 80 4 Martinez Antioch Richmond Pleasant Hill 680 Walnut Creek SAN FRANCISCO 4.45% $1.15-$3.75/SF 80 BAY BRIDGE Berkeley Emeryville Oakland 24 CONTRA COSTA CONTRA COSTA 52.59% $1.88-$2.15/SF SAN FRANCISCO 880 Alameda 680 San Ramon Brisbane Millbrae Burlingame SAN FRANCISCO BAY San Mateo Belmont San Carlos 92 San Leandro SAN MATEO BRIDGE San Lorenzo Castro Valley DUMBARTON BRIDGE Hayward Union City ALAMEDA Fremont 84 880 Dublin Pleasanton ALAMEDA Livermore 105,322 SF 15.17% $1.29-$2.20/SF SAN MATEO SAN MATEO Redwood City 73,652 SF 8.53% $1.44-$2.50/SF Menlo Park Palo Alto West Menlo Park Mountain View Los Altos Sunnyvale 237 Santa Clara 880 Milpitas SANTA CLARA San Jose SANTA CLARA 13.71% $1.35-$2.15/SF

AVAILABILITY BY AREA 1500000 1200000 52.59% 60 48 900000 600000 300000 4.45% 8.53% 13.71% 15.17% 36 24 12 Overall 0 0.00% Marin County 0 Wet Labs Life Science & Cleantech Life Science & Cleantech Life Science & Life Cleantech Science & Cleantech Clean Rooms Overall VENTURE CAPITAL FINANCING INDUSTRY $ FUNDED Life Sciences $550,551,004 Cleantech $121,000,000 TOTAL $671,551,004 SERIES TYPE # OF COMPANIES Series A 1 Series B 2 Series C 0 Series D 3 Series E 2 Series F 2 Undisclosed 21 IPO 0 Private 0 Corporate Partnership 0 TOTAL 31 MONTH FUNDED # OF COMPANIES July 19 August 10 September 2 TOTAL 31 SIGNIFICANT TRANSACTIONS 3RD QUARTER 2010 TENANT ADDRESS CITY SQUARE FEET Onyx Pharmaceutical 249 East Grand Avenue South San Francisco 126,000 Theravance 901 Gateway Boulevard South San Francisco 110,428 Arstasis 740 Bay Road Redwood City 60,985 BioGenex Laboratories, Inc. 49000 Milmont Drive Fremont 40,322 Tethys Bioscience 5858 Horton Street Emeryville 29,378 BioTime 1301 Harbor Bay Parkway Alameda 17,000 DFine, Inc. 3051-3087 North First Street San Jose 14,703 Calithera 341 Oyster Point Boulevard South San Francisco 14,000 2

3RD QUARTER 2010 SUBMARKET SUMMARIES San Francisco s Mission Bay continues to be the only option for those companies looking for life science space in the City. This market s long term significance in the life science and medical research fields has again been underscored by the announcement that the new UCSF research hospital is funded and development is already underway. Scheduled for completion in 2014, this 289 bed facility will meet the needs of women, children and cancer patients. The opportunity that this provides to take research from the bench to the bedside is attracting even more interest to this location. The success of Fibrogen s ability to meet the needs of the micro life science community is attested to by the fact that some 15,000 sq. ft. of the company s head quarters building at 409 Illinois Street has been sub-leased to these tenants. Alexandria Real Estate Equities is driving the foundation piles for the company s next two buildings on Third Street- these 200,000 sq. ft. plus structures could be ready for occupation towards the end of 2012. Market activity in the third quarter of 2010 was down noticeably from the previous quarter with total net absorption of 66,652 square feet. The most significant leases inked in the quarter occured in South San Francisco, the Bay Area s leading biotech submarket. Onyx Pharmaceutical signed a new lease, which was partially an Exelixis sublease and direct deal with ARE, for 126,000 square feet 249 East Grand Avenue (Alexandria Technology Campus). In the largest renewal of the quarter, Theravance renewed their 110,428 square foot lease at 901 Gateway Boulevard. Also of note, Arstasis subleased 60,985 square feet from ev3 (who acquired FoxHollow Technologies) at 740 Bay Road in Redwood City. Touring activity picked up dramatically in the latter half of the third quarter, however leasing activity remained relatively slow. BioGenex Laboratories signed the largest lease of the quarter for 40,322 square feet at 49026 Milmont Drive in Fremont. Also, Lawrence Berkeley National Laboratory moved into 24,000 square feet at 717 Potter Street in Berkeley. The County s vacancy rate of existing life science and clean tech space held steady at 15.17%. Asking rates range also remained relatively unchanged at $0.68 - $3.50 per square foot per month, on a triple net basis. Overall, increased touring activity is expected to result in greater transaction volume in the fourth quarter. The county of Contra Costa, with the smallest building base of any life science market tracked in the Bay Area, saw very little leasing activity in the third quarter. With approximately 370,000 square feet currently available for lease, Contra Costa county makes up less than a quarter of the total square feet marketed in the East Bay. DEMAND FOR LIFE SCIENCE SPACE 21 Active Requirements 2 Active Requirements 20 Active Requirements In the third quarter, market activity was notably slow in. No major lease deals were signed before the end of the quarter, while the vacancy rate in life science space had a quarter over quarter increase of 86 basis points to 13.71%. The County s vacancy rate has remained elevated this year, largely due to Roche vacating 900,000 square feet in Stanford Research Park last quarter. Leasing activity followed the industry trend of slowing down in the summer months, but market recovery is expected to regain momentum by year s end. SIZE OF TENANT REQUIREMENT 0-10,00 50,000-100,00 10,000-50,00 100,000-300,00 20 Active Requirements 3

AVAILABILITY BY with with Under 4,999 sf 1 Under 4,999 sf 1 10 1 5,000-9,999 sf 5,000-9,999 sf 2 14 1 1 1 10,000-14,999 sf 2 10,000-14,999 sf 1 14 1 4 15,000-19,999 sf 15,000-19,999 sf 1 5 1 20,000-24,999 sf 2 20,000-24,999 sf 3 1 6 2 25,000-29,999 sf 1 25,000-29,999 sf 2 7 2 2 30,000-34,999 sf 30,000-34,999 sf 2 2 9 4 1 35,000-39,999 sf 1 35,000-39,999 sf 1 40,000-44,999 sf 1 1 40,000-44,999 sf 3 1 45,000-49,999 sf 45,000-49,999 sf 1 1 1 50,000-54,999 sf 50,000-54,999 sf 1 1 55,000-59,999 sf 55,000-59,999 sf 1 60,000-64,999 sf 60,000-64,999 sf 1 65,000-69,999 sf 1 65,000-69,999 sf 1 2 1 1 70,000-74,999 sf 70,000-74,999 sf 1 75,000-79,999 sf 75,000-79,999 sf 1 1 80,000-84,999 sf 80,000-84,999 sf 85,000-89,999 sf 85,000-89,999 sf 1 90,000-94,999 sf 90,000-94,999 sf 1 1 1 95,000-99,999 sf 95,000-99,999 sf Over 100,000 sf 3 5 Over 100,000 sf 2 3 4 1 1 with with Under 4,999 sf 6 Under 4,999 sf 8 5,000-9,999 sf 5 4 3 5,000-9,999 sf 2 15 1 1 10,000-14,999 sf 7 8 3 10,000-14,999 sf 3 2 8 1 15,000-19,999 sf 5 4 15,000-19,999 sf 4 2 6 2 3 20,000-24,999 sf 8 4 1 1 20,000-24,999 sf 3 8 1 25,000-29,999 sf 2 4 25,000-29,999 sf 2 3 1 30,000-34,999 sf 2 1 30,000-34,999 sf 1 3 1 35,000-39,999 sf 1 3 35,000-39,999 sf 2 1 1 40,000-44,999 sf 2 40,000-44,999 sf 1 3 1 45,000-49,999 sf 2 2 1 45,000-49,999 sf 2 1 1 50,000-54,999 sf 3 1 50,000-54,999 sf 2 6 2 1 1 55,000-59,999 sf 1 1 55,000-59,999 sf 1 60,000-64,999 sf 1 60,000-64,999 sf 65,000-69,999 sf 2 1 1 65,000-69,999 sf 3 1 70,000-74,999 sf 70,000-74,999 sf 75,000-79,999 sf 1 75,000-79,999 sf 80,000-84,999 sf 80,000-84,999 sf 1 85,000-89,999 sf 85,000-89,999 sf 1 90,000-94,999 sf 1 1 90,000-94,999 sf 95,000-99,999 sf 95,000-99,999 sf 1 1 1 Over 100,000 sf 1 1 Over 100,000 sf 5 2 1 with Marin County with Under 4,999 sf 1 Under 4,999 sf 5,000-9,999 sf 3 1 5,000-9,999 sf 10,000-14,999 sf 2 10,000-14,999 sf 15,000-19,999 sf 1 15,000-19,999 sf 20,000-24,999 sf 20,000-24,999 sf 25,000-29,999 sf 1 25,000-29,999 sf 30,000-34,999 sf 30,000-34,999 sf 35,000-39,999 sf 1 35,000-39,999 sf 40,000-44,999 sf 40,000-44,999 sf 45,000-49,999 sf 1 45,000-49,999 sf 50,000-54,999 sf 50,000-54,999 sf 55,000-59,999 sf 1 55,000-59,999 sf 60,000-64,999 sf 60,000-64,999 sf 65,000-69,999 sf 65,000-69,999 sf 70,000-74,999 sf 70,000-74,999 sf 75,000-79,999 sf 75,000-79,999 sf 80,000-84,999 sf 80,000-84,999 sf 85,000-89,999 sf 85,000-89,999 sf 90,000-94,999 sf 90,000-94,999 sf 95,000-99,999 sf 95,000-99,999 sf Over 100,000 sf 2 1 Over 100,000 sf 4

GVA KIDDER MATHEWS LIFE SCIENCE & CLEANTECH REAL ESTATE GROUP A Commitment to Excellence GVA Kidder Mathews is a corporate real estate advisory and brokerage firm. Our Life Sciences & Cleantech Real Estate Practice specializes in the unique requirements of companies within this industry sector. We partner with our clients to define and refine an acquisition strategy and then develop a real estate solution that best fits the company s business model and growth. GVA Kidder Mathews superior market knowledge delivers more options to our clients which have enabled them to achieve better transaction economics, a reduction of capital costs while minimizing their out of pocket expense. Key strategic real estate decisions focus on: What type of facilities are required; The timing of the requirement; How to acquire the real estate and what are the occupancy costs; How to finance the tenant improvements. The GVA Kidder Mathews Life Science & Cleantech Advantage Strategic Real Estate Planning. Real Estate Acquisition Services. Financial Analysis. Real Estate Disposition Services. Specialized LABS Database. Our objective is to assist our clients in developing real estate strategies and solutions to support overall business objectives, and to enhance shareholder value. Strategic Advantage - Increases our client s leverage during the negotiation process. Strategic Advantage The strategic planning process results in optimal real estate occupancy cost savings. A well conceived real estate strategy becomes the blueprint for a successful real estate transaction. This is where GVA Kidder Mathews positions the client to continue its development and growth without the company s real estate becoming a physical or financial constraint. GVA Kidder Mathews specialized database will provide clients with the following key strategic advantage: Tracks current available wet laboratory spaces. Tracks wet laboratory spaces that will be coming on-line over the next twenty-four (24) month period. Tracks lease expiration dates of current life science tenants. Tracks current life science requirements in the market. Tracks companies that are getting funded. Tracks companies that are in the midst of re-structuring and M&A discussions. GVA Kidder Mathews Life Science & Cleantech Real Estate Practice has a combined experience of 90 years in executing complex real estate solutions that meet our client s real estate needs. GVA Kidder Mathews would like to be your real estate and facilities strategic partner. Let us handle all of your real estate and facilities needs while you remain focused on driving your company s success. GVA KIDDER MATHEWS SERVICES GVA Kidder Mathews realizes that a lease transaction is only part of a larger process, and that life science and cleantech tenants require a wide range of other high quality specialized service providers. To assist our clients, we have relationships with experts in all of the required disciplines: corporate business strategist, project/construction management, licensing, permits, and code compliance, furniture and equipment, manufacturing systems advisory, third party improvement financing, legal, recruitment, moving, telecommunications, and architecture. 2009 NORTHERN CALIFORNIA LIFE SCIENCES REAL ESTATE SURVEY GVA Kidder Mathews co-authored the 2009 Bay Bio Life Sciences Real Estate Survey which was presented at the 10th Annual Gene Acres Conference and is updated and presented on an annual basis. Last year, the survey was sent to 354 life science companies throughout the Bay Area, which contained questions about market lease rates/trends, community rankings, planning consideration, build out costs and future space demands. We have developed the most comprehensive life science & cleantech database in the commercial real estate industry. CONTACT www.gvakm.com California Washington Oregon SAN FRANCISCO 505 Sansome St Suite 300 San Francisco, CA 94111 415.229.8888 REDWOOD SHORES 203 Redwood Shores Pkwy Suite 530 Redwood City, CA 94065 650.769.3600 SILICON VALLEY 3945 Freedom Cir Suite 900 Santa Clara, CA 95054 408.970.9400 SEATTLE 601 Union St Suite 4720 Seattle, WA 98 206.296.9600 BELLEVUE 500 108th Ave NE Suite 2400 Bellevue, WA 98004 425.454.7040 TACOMA 1201 Pacific Ave Suite 1400 Tacoma, WA 98402 253.722.1400 PORTLAND One SW Columbia St Suite 950 Portland, OR 97258 503.221.9900 This information supplied herein is from sources we deem reliable. It is provided without any representation, warranty or guarantee, expressed or implied as to its accuracy. Prospective Buyer or Tenant should conduct an independent investigation and verification of all matters deemed to be material, including, but not limited to, statements of income and expenses. CONSULT YOUR ATTORNEY, ACCOUNTANT, OR OTHER PROFESSIONAL ADVISOR. Designated Broker: Wayne Mascia LIC #00340573 5