MARKETBEAT , AB Office Q4 2020

ECONOMY YoY 12-Mo. After a difficult year, moderate GDP growth is expected in Edmonton of approximately 4.0% in 2021 (Source: City of Edmonton Fall 2020 Chg Forecast Forecast Update). The COVID-19 pandemic, tighter public health measures, and volatile oil prices will continue to weigh on the local economy and cause a slowdown in economic recovery. Seasonally adjusted unemployment in the Edmonton CMA decreased by 20 basis 18.6% points month-over-month to 11.1% in December 2020. Edmonton’s year-to-date 2020 non-residential construction permits as of November Vacancy Rate 2020 declined by 15.2% year-over-year with industrial, commercial, and institutional decreasing by 21.5%, 13.1%, and 17.9%, respectively.

-275,806 SUPPLY AND DEMAND Net Absorption, SF The Edmonton office market recorded the weakest absorption in 5 years, with total negative absorption of 973k square feet (sf) in 2020. As the pandemic continues to impact market conditions, Edmonton has seen more tenants downsizing or moving out than tenants moving in. $33.72 This was particularly the case for Class AA and A, which accounted for 68.5% of the total negative absorption this year, while Class B and Gross Asking Rent, PSF C accounted for 22.7% and 8.8%, respectively. As a result, overall Edmonton vacancy increased to 18.6% in the fourth quarter of 2020 from 17.4% last quarter, and from 15.1% during the same period last year. (Overall, All PropertyClasses) As space available for sublease continues to grow, accounting for over 13.7% of all available space in the fourth quarter of 2020, compared to only 8.8% one-year-ago, tenants have the opportunity to secure space at a lower rate in either downtown or suburban markets. However, ECONOMIC INDICATORS most companies are prioritizing reducing business costs until the market begins to show some signs of improvement. An additional 150k sf Q4 2020 of sublease space was added to the market this quarter, bringing the total to 745,674 sf in the fourth quarter 2020. Most notably, Stantec released 96,900 sf to the sublease market this quarter; in addition to the 74,242 sf of sublease space added in the second quarter of this YoY 12-Mo. Chg Forecast year.

739.8K Leasing activity in Edmonton remained slow in 2020, with many of the deals this quarter in both CBD and non-CBD markets below 5k sf. Edmonton Rental rates, particularly in many older properties, have declined due to increasing vacancy. Average gross asking rents dropped $0.27 to Employment $33.72 per square foot compared to last quarter.

11.1% OUTLOOK Edmonton Vacancy is expected to continue to increase, driven by a combination of natural headlease expiries and a substantial increase in the Unemployment Rate amount of sublease space. The Edmonton market will also continue to see a slowdown in office demand as the market remains impacted by the COVID-19 pandemic. However, with the vaccine rollout in starting in 2021, this offers some optimism for companies and 8.6% businesses to get back to normal operations or adapt to hybrid workplaces. Hence, Edmonton’s office market is expected to gradually pick up in the next 12 to 24 months. Unemployment Rate SPACE DEMAND / DELIVERIES OVERALL VACANCY & GROSS ASKING RENT

$35 21% Source: Statistics Canada 1,500 1,000 $34 500 14% $33 0 $32 -500 7%

Thousands -1,000 $31

-1,500 $30 0% 2015 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

Net Absorption, SF Construction Completions, SF Asking Rent, $ PSF Vacancy Rate MARKETBEAT

EDMONTON, AB Office Q4 2020 MARKET STATISTICS SUBLET DIRECT OVERALL CURRENT QTR YTD OVERALL UNDER OVERALL AVG OVERALL AVG TOTAL INVENTORY VACANT VACANCY OVERALL NET NETABSORPTION CNSTR ASKING RENT ASKING RENT SUBMARKET BUILDINGS (SF) VACANT (SF) (SF) RATE ABSORPTION (SF) (SF) (SF) (ALL CLASSES)* (CLASS A)* Financial Core 54 12,712,753 464,611 1,852,713 18.2% -181,236 -354,192 0 $37.29 $37.70 Government 36 5,267,537 14,263 718,456 13.9% -5,006 -205,129 0 $31.62 $32.66 CENTRAL TOTALS 90 17,980,290 478,874 2,571,169 17.0% -186,242 -559,321 0 $36.78 $36.04 124th Street 18 952,909 14,687 174,773 19.9% -1,503 -43,405 0 $28.93 $32.43 149th Street 26 1,257,029 0 212,414 16.9% -11,378 6,838 0 $26.89 $30.30 West End 36 1,934,428 22,244 250,748 14.1% -1,422 -25,219 120,000 $26.37 $34.09 Kingsway 17 822,310 1,480 146,185 18.0% -3,006 -31,247 0 $30.76 $36.15 Whyte Avenue 13 538,121 5,411 107,285 20.9% -5,609 -12,018 0 $35.75 $41.40 Southside 59 3,130,008 163,721 638,963 25.6% -58,126 -255,472 0 $30.59 $32.65 Summerside 22 944,045 54,257 58,165 11.9% 6,853 -34,215 0 $33.15 $33.15 Eastgate 17 1,423,618 5,000 490,083 34.8% -15,373 -13,020 0 $26.01 $30.08 Windermere/Ambleside 10 296,108 0 53,384 18.0% 0 -6,178 0 $40.00 $40.00 SUBURBAN TOTALS 218 11,298,576 266,800 2,132,000 21.2% -89,564 -413,936 120,000 $29.24 $33.22 EDMONTON TOTALS 308 29,278,866 745,674 4,703,169 18.6% -275,806 -973,257 120,000 $33.72 $34.98 *Rental rates reflect gross asking $psf/year

OVERALL CURRENT QTR YTD OVERALL UNDER TOTAL INVENTORY SUBLET DIRECT YTD CONSTRUCTION OVERALL AVG SUMMARY BY CLASS VACANCY OVERALL NET NETABSORPTION CNSTR BUILDINGS (SF) VACANT (SF) VACANT (SF) COMPLETIONS (SF) ASKING RENT* RATE ABSORPTION (SF) (SF) (SF) Class AA 8 4,377,804 260,699 430,944 15.8% -146,325 -143,910 0 0 $51.12 Class A 117 13,871,457 401,442 2,270,859 19.3% -91,238 -522,715 120,000 34,600 $34.98 Class B 141 9,200,246 68,507 1,725,350 19.5% -15,273 -220,836 0 36,360 $27.30 Class C 42 1,829,359 15,026 276,016 15.9% -22,970 -85,796 0 0 $23.49 *Rental rates reflect gross asking $psf/year For more information, contact: OFFICE TEAM KEY LEASE TRANSACTIONS Q4 2020 +1 780 420 1177 [email protected] PROPERTY SUBMARKET TENANT SF TYPE TD Tower Downtown – Financial McCuaig Desrochers 14,180 Headlease A CUSHMAN & WAKEFIELD RESEARCH PUBLICATION 103 Street Centre Downtown – Financial ONE Properties 11,109 Headlease Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real 102A Tower Downtown – Financial Biamonte 8,500 Headlease estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with KEY SALES TRANSACTIONS Q4 2020 approximately 53,000 employees in 400 offices and 60 countries. In 2019, the firm had revenue of $8.8 billion across PROPERTY SUBMARKET SELLER / BUYER SF PRICE / $ PSF core services of property, facilities and project management, Ten 303 Ltd / Redstone 10303 Canadian Western Bank Downtown – Financial 408,983 $96.4M / $236 leasing, capital markets, valuation and other services. To Jasper Avenue Real Estate Holdings Ltd learn more, visit www.cushmanwakefield.com or follow 1602157 Alberta Ltd. / @CushWake on Twitter. CN Tower* Downtown – Financial 285,312 $64.1M / $225 Trez CN Tower Holdings Ltd. Whitemud Equities Inc / Greywood Office Ventures ©2021 Cushman & Wakefield. All rights reserved. The information Greystone Business Park Suburban – Southside 105,433 $9.1M / $86 Inc contained within this report is gathered from multiple sources believed to be reliable. The information may contain errors or omissions and is Great West Saddlery Building Downtown – Financial Access Partners Inc / Limak Reina Investments Inc 34,825 $5.5M / $159 presented without any warranty or representations as to its accuracy. *Sale involves an assumption of debt cwedm.com