2017

DOWNTOWN OFFICE SURVEY Hamilton, Ontario

Prepared by:

Mr. David H. Blanchard, B.A., CCIM, S.I.O.R., CPM.

President, Blair Blanchard Stapleton Limited

&

Mr. Evan J. Apostol, B.Comm

Sales Representative, Blair Blanchard Stapleton Limited

Effective Date: December 31st 2017

DISCLAIMER:

ANY REPRODUCTION AND/OR DISTRIBUTION OF THIS MATERIAL OR INFORMATION THEREFROM IS STRICTLY FORBIDDEN UNLESS PRIOR WRITTEN APPROVAL IS RECEIVED FROM MR. DAVID H. BLANCHARD, PRESIDENT, BLAIR BLANCHARD STAPLETON LIMITED, 701 MAIN STREET WEST, SUITE 101, HAMILTON ONTARIO L8S 1A2 PHONE 905 529 5900 FAX 905 529 7474

Table of Contents

Introduction General ...... ii Assumptions ...... ii Summary ...... ii Buildings 21 King Street West ...... 1 1 King Street West, Commerce Place, Phase 1 ...... 2 120 King Street West, Standard Life Centre ...... 3 110 King Street West, Robert Thompson Building ...... 4 5 100 King Street West ...... 5 1 James Street North, Bank of Montreal Pavilion ...... 6 One Main Street West ...... 7 5 One Hunter Street East ...... 8 4 Hughson Street South, HSBC Bank Building ...... 9 5 25 Main Street West ...... 10 5 One James Street South ...... 11 5 20 Hughson Street South, Union Gas Building ...... 12 35 King Street East, Right House ...... 13 31 King Street East, Hughson Centre ...... 14 5 21 Hunter Street East ...... 15 77 James Street North, Hamilton City Centre ...... 16 5 105 Main Street East, Effort Square ...... 17 119 King Street West, The Ellen Fairclough Building ...... 18 25 Charlton Avenue East, Charlton Centre ...... 19 123 James Street North ...... 20 5 69 John Street South ...... 21 5 180 James Street South ...... 22 1 Young Street, Hamilton Medical Arts Building ...... 23 Appendix A: Summary Table Appendix B: Timeline Graph

i Introduction

General Data for this study was compiled from major office complexes in the Downtown Core of Hamilton Ontario. Sources of data includes building representatives, tenants, and/or MLS / Market listings. All information in this study was taken from reliable sources and is adjudged to be correct but is not guaranteed.

Scope The focus of this survey is mid-to large scale Class ‘A’ and ‘B’ office buildings in the downtown core of Hamilton. For this reason, the following buildings are omitted from the survey:  Buildings with a Gross Leasable Area of less than 20,000 square feet;  Public/government buildings such as: o David Braley Health Sciences Centre located at 100 Main St W; o Federal Building located at 55 Bay St N; o Lister Block located at 50 James St N; o Hamilton City Hall located at 71 Main Street West;  Any building that is privately held, but not available for lease on the open market (such as owner occupied buildings);  Similar non market-driven buildings.

Assumptions Vacancies shown are typically an aggregate of multiple suites unless otherwise specified. Space available directly from landlords is shown as a separate item within the survey (“Direct”). Space that is available for sublease and space that is currently being subleased is shown as a separate item (“Sublease”). Rates quoted are building asking rates and not sub-lease rates. Space that will be vacated based on a firm tenant commitment elsewhere is included in the total building vacancy, and space that will be occupied based on a firm commitment will be omitted from the total building vacancy.

Summary Number of Buildings Surveyed ...... 23 2,876,451 Total space available directly from Landlords ...... 616,681 Total subleased space ...... 18,081 Total vacant space (including subleased space) ...... 634,762 Percentage total direct vacancy ...... 20.97% Subleased space as a percentage of total market ...... 0.61% Percentage total vacancy (including subleased space) ...... 21.59%

ii 21 KING STREET WEST

Building Info: Year Built / Renovated: Built 1991 Rentable Area (RSF): 194,540 Full Floor Size (RSF): 12,417

Vacancy Info: Direct (RSF): 40,748* Sublease (RSF): None. Percentage Vacant: 20.95%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $14.00 per Rentable Square Foot Additional Rent: $12.30 per Rentable Square Foot (estimate for 2018)

Remarks: One of the few class “A” office buildings in the downtown core. Ideally situated just off the intersection of King and James Streets. Underground parking available. Ample surface parking nearby. Suites feature many windows, great views and natural light.

* Notable Vacancies: Ground Floor: 7,031sf + 2nd Floor: 14,774sf

page 1 COMMERCE PLACE, Phase 1 1 King Street West

Building Info: Year Built / Renovated: Built 1985 Rentable Area (RSF): 185,091 Full Floor Size (RSF): 11,478

Vacancy Info: Direct (RSF): 26,490 Sublease (RSF): None. Percentage Vacant: 14.31%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $10.00 - $12.00 per Rentable Square Foot Additional Rent: $18.00 per Rentable Square Foot (estimate for 2018)

Remarks: Major tenant C.I.B.C.

page 2 120 KING STREET WEST

Building Info: Year Built / Renovated: Built 1983 Rentable Area (RSF): 477,265 Full Floor Size (RSF): 40,000

Vacancy Info: Direct (RSF): 124,360 Sublease (RSF): None. Percentage Vacant: 26.06%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $10.00 per Rentable Square Foot Additional Rent: $16.00 per Rentable Square Foot (estimate for 2018)

Remarks: Phase IV of Lloyd D. Jackson Square Complex. Atrium design featuring column-free floorplates. Full elevator moderization completed. Common washrooms recently renovated.

page 3 ROBERT THOMSON BUILDING 110 King Street West

Building Info: Year Built / Renovated: Built 1976 Rentable Area (RSF): 170,797 Full Floor Size (RSF): 20,500

Vacancy Info: Direct (RSF): 28,349 Sublease (RSF): None. Percentage Vacant: 16.60%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $10.00 per Rentable Square Foot Additional Rent: $16.00 per Rentable Square Foot (estimate for 2018)

Remarks: Phase II of Lloyd D. Jackson Square Complex, featuring column free floorplates. Full elevator modernization underway.

page 4 100 KING STREET WEST

Building Info: Year Built / Renovated: Built 1972 Rentable Area (RSF): 375,889 Full Floor Size (RSF): 16,500

Vacancy Info: Direct (RSF): 162,070 Sublease (RSF): 18,081 Percentage Vacant: 47.93%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $10.00 per Rentable Square Foot Additional Rent: $16.00 per Rentable Square Foot (estimate for 2018)

Remarks: Phase I of Lloyd D. Jackson Square Complex, featuring column free floorplates. Full elevator modernization, and common washrooms renovated recently. AODA compliant building.

page 5 1 JAMES STREET NORTH

Building Info: Year Built / Renovated: Built 1972 Rentable Area (RSF): 47,671 Full Floor Size (RSF): 16,667

Vacancy Info: Direct (RSF): None. Sublease (RSF): None. Percentage Vacant: 0.00%

Remarks: McMaster University Downtown Centre.

page 6 ONE MAIN STREET WEST

Building Info: Year Built / Renovated: Fully renovated 2005 Rentable Area (RSF): 37,193 Full Floor Size (RSF): 10,259

Vacancy Info: Direct (RSF): None. Sublease (RSF): None. Percentage Vacant: 0.00%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $16.00 per Rentable Square Foot Additional Rent: $17.00 per Rentable Square Foot (estimate for 2018)

Remarks: Complete restoration and expansion of historic former Bank of Montreal Building. Completed Fall 2005.

page 7 ONE HUNTER STREET EAST

Building Info: Year Built / Renovated: Fully renovated 2008 Rentable Area (RSF): 27,578 Full Floor Size (RSF): 6,928

Vacancy Info: Direct (RSF): None. Sublease (RSF): None. Percentage Vacant: 0.00%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $17.00 per Rentable Square Foot Additional Rent: $12.55 per Rentable Square Foot (estimate for 2018)

Remarks: Complete reconstruction and full floor addition of former City Heath Building. Completed June 2008. On site parking.

page 8 HSBC BANK BUILDING 4 Hughson Street South

Building Info: Year Built / Renovated: Built 1979 Rentable Area (RSF): 97,743 Full Floor Size (RSF): 9,078 even floors, 9,324 odd floors

Vacancy Info: Direct (RSF): 9,078 Sublease (RSF): None. Percentage Vacant: 9.29%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $12.00 per Rentable Square Foot Additional Rent: $11.70 per Rentable Square Foot (estimate for 2018)

Remarks: Excellent location, energy efficient, HVAC, elevators upgraded recently. Parking adjacent.

page 9 25 MAIN STREET WEST

Building Info: Year Built / Renovated: Built 1971 Rentable Area (RSF): 144,784 Full Floor Size (RSF): 6,745

Vacancy Info: Direct (RSF): 20,199(tower) Sublease (RSF): None. Percentage Vacant: 13.95%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $11.00 (tower); $15.00 (ground floor) per Rentable Square Foot Additional Rent: $11.20 per Rentable Square Foot (estimate for 2018)

Remarks: Award winning design, underground parking. Building has been extensively upgraded (common areas, lobby, elevator, HVAC)

page 10 ONE JAMES STREET SOUTH

Building Info: Year Built / Renovated: Built 1975 Rentable Area (RSF): 82,374 Full Floor Size (RSF): 5,400

Vacancy Info: Direct (RSF): None. Sublease (RSF): None. Percentage Vacant: 0.00%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $10.00 (tower); $20.00 (ground floor) per Rentable Square Foot Additional Rent: $12.50 per Rentable Square Foot (estimate for 2018)

Remarks: Excellent location, no parking

page 11 UNION GAS BUILDING 20 Hughson Street South

Building Info: Year Built / Renovated: Built 1967 Rentable Area (RSF): 88,905 Full Floor Size (RSF): 8,255

Vacancy Info: Direct (RSF): 18,332(tower) Sublease (RSF): None. Percentage Vacant: 20.62%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $9.00 (tower); $11.00 (ground floor) per Rentable Square Foot Additional Rent: $10.10 per Rentable Square Foot (estimate for 2018)

Remarks: Newer security system, window film, intercom, elevators, etc. New cooling tower (2013).

page 12 RIGHT HOUSE 35 King Street East

Building Info: Year Built / Renovated: Built 1984 Rentable Area (RSF): 82,538 Full Floor Size (RSF): 13,439

Vacancy Info: Direct (RSF): 58,312* Sublease (RSF): None. Percentage Vacant: 70.65%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $17.00 per Rentable Square Foot Additional Rent: $10.00 per Rentable Square Foot (estimate for 2018)

Remarks: Built in 1883, completely renovated in September 1984.

* Tower: 57,189sf + Ground Floor: 1,123sf (office / retail)

page 13 HUGHSON CENTRE 31 King Street East

Building Info: Year Built / Renovated: Built 1997 Rentable Area (RSF): 60,000 Full Floor Size (RSF): 14,604

Vacancy Info: Direct (RSF): 18,641 Sublease (RSF): None. Percentage Vacant: 31.07%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $11.50 per Rentable Square Foot Additional Rent: $ 6.50 per Rentable Square Foot (estimate for 2018)

Remarks: Re-built in 1997.

* Third floor: 15,176sf + Second floor: 3,465sf

page 14 21 HUNTER STREET EAST

Building Info: Year Built / Renovated: Built 1945 Rentable Area (RSF): 18,706 Full Floor Size (RSF): 5,324

Vacancy Info: Direct (RSF): None. Sublease (RSF): None. Percentage Vacant: 0.00%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $ 9.00 per Rentable Square Foot Additional Rent: $11.75 per Rentable Square Foot (estimate for 2018)

Remarks: “Cooper Building” original head office of Cooper Construction; December 2008 recent upgrades (roof, HVAC); On site parking

page 15 HAMILTON CITY CENTRE 77 James Street North

Building Info: Year Built / Renovated: Built 1991 Rentable Area (RSF): 265,000 Full Floor Size (RSF): 75,257 - 124,169

Vacancy Info: Direct (RSF): 26,000 Sublease (RSF): None. Percentage Vacant: 9.81%

Current Rental Rates: Type of Lease: Gross Gross Rental Rate: $18.00(plus utilities and cleaning) per Rentable Square Foot Base Year: 2013

Remarks: Office portion of 417,328 square foot former Eaton Centre.

page 16 EFFORT SQUARE 105 Main Street East

Building Info: Year Built / Renovated: Built 1966 Rentable Area (RSF): 131,600 Full Floor Size (RSF): 9,380

Vacancy Info: Direct (RSF): 21,122* Sublease (RSF): None. Percentage Vacant: 16.05%

Current Rental Rates: Type of Lease: Gross Gross Rental Rate: $20.00 (tower); $18.00 - $12.00 (ground floor); $10.00 (below grade) per Rentable Square Foot Base Year: 2014

Remarks: Part of larger complex of retail outlets, apartments and Crowne Plaza Hotel.

* Office: 18,541sf + Retail: 2,581sf

page 17 THE ELLEN FAIRCLOUGH BUILDING 119 King Street West

Building Info: Year Built / Renovated: Built 1980 Rentable Area (RSF): 252,422 Full Floor Size (RSF): 17,257

Vacancy Info: Direct (RSF): 37,763(includes 8,464 sf of contiguous space on 11th Floor) Sublease (RSF): None. Percentage Vacant: 14.96%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $14.00 per Rentable Square Foot Additional Rent: $ 9.00 per Rentable Square Foot (estimate for 2018)

Remarks: Mainly government tenants.

page 18 CHARLTON CENTRE 25 Charlton Avenue East

Building Info: Year Built / Renovated: Built 1974 Rentable Area (RSF): 48,000 Full Floor Size (RSF): 5,000

Vacancy Info: Direct (RSF): 3,850 Sublease (RSF): None. Percentage Vacant: 8.02%

Current Rental Rates: Type of Lease: Gross Gross Rental Rate: $21.50 per Rentable Square Foot Base Year: 2014

Remarks: Primarily medical building

page 19 123 JAMES STREET NORTH

Building Info: Year Built / Renovated: Built 2014 Rentable Area (RSF): 34,000 Full Floor Size (RSF): 11,000

Vacancy Info: Direct (RSF): 2,600* Sublease (RSF): None. Percentage Vacant: 7.65%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $18.00 (office); $25.00 (retail) per Rentable Square Foot Additional Rent: $11.00 per Rentable Square Foot (estimate for 2018)

Remarks: Features underground parking, key card access, and roof top terrace. 74 parking spaces service building. Landlord will offer TIs subject to term and covenant.

* Vacancy on ground floor, no street exposure.

page 20 69 JOHN STREET SOUTH

Building Info: Year Built / Renovated: Built 1990 Rentable Area (RSF): 43,237 Full Floor Size (RSF): 8836

Vacancy Info: Direct (RSF): 9,512 Sublease (RSF): None. Percentage Vacant: 22.00%

Current Rental Rates: Type of Lease: Net Net Rental Rate: $18.00 (office); $25.00 (retail) per Rentable Square Foot Additional Rent: $ 5.35 per Rentable Square Foot (estimate for 2018)

Remarks: Re-built in 1989; adaptive reuse from warehouse; exposed brick and structural wooden beams. Excellent location and wheelchair accessible, modern and updated interiors.

page 21 180 JAMES STREET SOUTH

Building Info: Year Built / Renovated: Built 1995 Rentable Area (RSF): 32,016 Full Floor Size (RSF): 5,734

Vacancy Info: Direct (RSF): 6,955 Sublease (RSF): None. Percentage Vacant: 21.72%

Current Rental Rates: Type of Lease: Gross Gross Rental Rate: $15.00 per Rentable Square Foot Additional Rent: $ 7.50 per Rentable Square Foot (estimate for 2018)

Remarks: Office building with large retail portion. Offices are generally smaller. Some underground parking.

page 22 HAMILTON MEDICAL ARTS BUILDING Corner of James Street South & Young Street

Building Info: Year Built / Renovated: Built 1933 Rentable Area (RSF): 43,355 Full Floor Size (RSF): 5,600

Vacancy Info: Direct (RSF): 2,300 Sublease (RSF): None. Percentage Vacant: 5.31%

Current Rental Rates: Type of Lease: Gross Gross Rental Rate: $22.00 per Rentable Square Foot Base Year: 2015

Remarks: Primarily office building for doctors and medical uses. Some commercial space being offered.

page 23 Appendix 'A': Summary Table 2017 Downtown Office Survey: Hamilton Ontario

As at: December 31 2017

Building Total RSF Direct Vacancy Subleased Total Vacancy

21 KING STREET WEST 194,540 40,748 0 40,748 COMMERCE PLACE, Phase 1 185,091 26,490 0 26,490 120 KING STREET WEST 477,265 124,360 0 124,360 ROBERT THOMSON BUILDING 170,797 28,349 0 28,349 100 KING STREET WEST 375,889 162,070 18,081 180,151 1 JAMES STREET NORTH 47,671 0 0 0 ONE MAIN STREET WEST 37,193 0 0 0 ONE HUNTER STREET EAST 27,578 0 0 0 HSBC BANK BUILDING 97,743 9,078 0 9,078 25 MAIN STREET WEST 144,784 20,199 0 20,199 ONE JAMES STREET SOUTH 82,374 0 0 0 UNION GAS BUILDING 88,905 18,332 0 18,332 RIGHT HOUSE 82,538 58,312 0 58,312 HUGHSON CENTRE 60,000 18,641 0 18,641 21 HUNTER STREET EAST 18,706 0 0 0 HAMILTON CITY CENTRE 265,000 26,000 0 26,000 EFFORT SQUARE 131,600 21,122 0 21,122 THE ELLEN FAIRCLOUGH BUILDING 252,422 37,763 0 37,763 CHARLTON CENTRE 48,000 3,850 0 3,850 123 JAMES STREET NORTH 34,000 2,600 0 2,600 69 JOHN STREET SOUTH 43,237 9,512 0 9,512 180 JAMES STREET SOUTH 32,016 6,955 0 6,955 HAMILTON MEDICAL ARTS BUILDING 43,355 2,300 0 2,300

2,940,704 616,681 18,081 634,762

Percentage Direct Space 20.97% Percentage Subleased Space 0.61% Total Vacancy 21.59% Appendix 'B': Chart of Direct + Subleased Vacant Space 2017 Downtown Office Survey: Hamilton Ontario 35.00%

30.00%

25.00%

20.00%

15.00%

10.00%

5.00%

0.00%

Direct Subleased