metropolitan chicago

DOWNTOWN office | First quarter 2008

www.colliersbk.com

COLLIERS BENNETT & KAHNWEILER INC. metropolitan chicago downtown office first Quarter 2008

First Quarter Table of Contents Colliers B&K Success Stories I. Downtown Office Market Overview 3 West Loop 4 Central Loop 5 East Loop 6 North Michigan Avenue 7 River North 8 Top First Quarter Transactions 9 First Quarter 2008 Downtown Office Market Statistics 10 Sara Lee Corporation 70 W. Madison Street Downtown Office Submarket Map 11 58,102 Square Feet Disposition II. about Colliers Bennett & Kahnweiler Inc. 12

Flashpoint Academy of Media Arts & Sciences 222 Merchandise Mart Plaza 21,666 Square Feet Sublease

McKenna Storer 33 N. LaSalle Street 14,297 Square Feet Renewal

COLLIERS BENNETT & KAHNWEILER INC. COLLIERS BENNETT & KAHNWEILER INC. 2 METROPOLITAN CHICAGO downtown office first Quarter 2008

“Despite healthy leasing Overview activity, net absorption in the Vacancy CBD was negative as tenants The first quarter overall CBD vacancy rate measured 13.5 percent, a slight increase from 13.3 percent posted during the fourth quarter of 2007. This marks only the second have become more cautious in increase in CBD vacancy in the last twelve quarters, a sign that the market may be starting the current economic climate.” to soften. The CBD’s increase in vacancy rate during the first quarter was fueled largely by tenants reacting to uncertainty in the economic climate, as recession fears heightened. As a result, many tenants are delaying relocation or expansion plans until the economy’s future is more clear. Lease and Sale Activity Despite an increase in the overall vacancy rate, the CBD still had numerous noteworthy lease signings including Northern Trust Corporation’s 420,000-square-foot renewal/ vacancy and absorption * Through First Quarter 2008 expansion at 181 W. Madison and CareerBuilder’s 150,000-square-foot renewal and expansion at 200 N. LaSalle Street. Three tenants completed transactions at new office 4,000,000 20.0% towers, an indication that demand for top-tier assets is still strong. William Blair signed a 3,500,000 18.0% 340,000-square-foot new lease to anchor the development at 444 W. Lake Street; Quarles 3,000,000 16.0% 2,500,000 14.0% & Brady leased 75,000 square feet at 300 N. LaSalle Street; and Skadden, Arps, Slate, 12.0% 2,000,000 10.0% Meagher & Flom expanded by 54,700 SF at 155 N. Wacker Drive to occupy a total of 1,500,000 8.0% 210,000 square feet. 1,000,000 6.0% Vacancy Rate 500,000 4.0% Square Feet Absorbed The investment sale market continued to cool during the first quarter as lending 0 2.0% -500,000 0.0% requirements tightened and demand continued to soften. The most noteworthy 2004 2005 2006 2007 2008 transaction was Deutsche Bank Group’s sale of UBS Tower, 1 N. Wacker Drive, to Hines Absorption Vacancy for a staggering $540 million or $403 per square foot. This is expected to be one of few major investment sales to occur in the CBD in 2008. Absorption Demand flattened during the first quarter, posting negative 251,723 square feet of net downtown Market Snapshot absorption, remarkably less than the positive 817,454 square feet reported in the prior quarter. Demand for space is likely to continue to be flat in the CBD for most of the Downtown Office Market Overview year as area job growth slows, credit markets continue to search for stabilization, and 4th Qtr 1st Qtr the breakdown of the residential real estate market continues to affect other industries. 2007 2008 Sublease availabilities are also expected to increase as some tenants attempt to dispose Vacancy 13.3% 13.5% of excess space. Rate  Absorption 817,454 sf -251,723 sf  Despite flat demand in the short-term, many large tenants have expirations looming and have already begun to explore the market, including KPMG, Baker & McKenzie, and Inventory 128,364,871 sf 128,364,871 sf |} Integrys Energy Group. Additionally, the CBD has continued to attract potential tenants from other markets. BP is rumored to be searching for 325,000 to 350,000 square feet of CBD space to relocate from its Warrenville, IL office in the western suburbs. Construction No new construction was delivered in the CBD during the first quarter. However, more than 7 million square feet of projects are proposed or underway for delivery between 2008 and 2012. These projects include Morningstar’s new headquarters at 22 W. Washington Street, 300 N. LaSalle Street, 353 N. Clark Street and 155 N. Wacker Drive. Some of this new inventory will be offset by the partial conversions of 330 N. Wabash Avenue and 208 S. LaSalle Street from office to hotel space.

3 COLLIERS BENNETT & KAHNWEILER INC. metropolitan chicago downtown office first Quarter 2008

West Loop “First quarter net absorption Vacancy was negative in the West Loop, The West Loop vacancy rate measured 13.0 percent in the first quarter, up from 12.7 a rare event for this highly percent in the fourth quarter of 2007. sought after submarket.” Lease and Sale Activity Despite an increase in vacancy rate for the quarter, the West Loop continued to witness steady leasing activity with four major lease transactions. William Blair signed a 340,000-square-foot lease at 444 W. Lake Street to become the anchor tenant at Hines’ proposed office tower. The investment firm will relocate from its current West Loop location at 222 W. Adams Street in 2011. Other transactions included a 54,700-square- foot expansion for Skadden Arps Slate Meagher & Flom at 155 N. Wacker Drive, bringing the law firm’s total future occupancy to more than 210,000 square feet. vacancy and absorption The only noteworthy West Loop sales transaction during the quarter was Hines’ purchase * Through First Quarter 2008 of UBS Tower (1 N. Wacker Drive) from Deutsche Bank Group for a staggering $540 million 2,500,000 20%

or $403 per square foot. Many believe that this could be one of few major investment 2,000,000 sales for the year due to the current credit crisis. 18% 1,500,000 16% Absorption 1,000,000 14% The West Loop has consistently performed as one of the strongest submarkets in the CBD, 500,000 Vacancy Rate

with five of the last seven quarters posting positive net absorption. However, absorption Square Feet Absorbed 12% measured negative 127,652 square feet in the first quarter, a dramatic decrease from 0 positive 666,629 square feet of net absorption posted in the fourth quarter of 2007. -500,000 2004 2005 2006 2007 200810% Even the highly coveted West Loop is not immune from the recent wave of cautious Absorption Vacancy tenants delaying expansion plans. However, it is likely that the West Loop will continue its trend of attracting new tenants from other submarkets, driving the potential for positive absorption in future quarters. Construction downtown Market Snapshot No new construction was delivered to the West Loop during the first quarter. West Loop Construction is still in progress at 155 N. Wacker Drive, the 1.1 million-square-foot tower being constructed by The John Buck Company. With Skadden, Arps, Slate, Meagher & 4th Qtr 1st Qtr 2007 2008 Flom’s recent expansion, the building is now approximately 40 percent pre-leased and other tenants, including Mercer, are rumored to be considering the new tower. Delivery Vacancy Rate 12.7% 13.0%  is expected in the summer of 2009. Absorption 666,629 sf -127,652 sf  William Blair’s lease signing during the first quarter will launch the future construction of Inventory 44,546,672 sf 44,546,672 sf |} Hines’ new 1.1-million-square foot office tower at 444 W. Lake Street, also known as River Point. Construction is scheduled to begin during fall of 2008 with delivery anticipated in June 2011. Additionally, it is rumored that BP PLC, currently located in Warrenville, IL, is in the market to lease approximately 325,000 to 350,000 square feet including its trading operations. BP PLC is said to be narrowing its prospects to either 10 & 30 S. Wacker Drive or a new development at Adams Street and Des Plaines Street to be developed by Fifield. The West Loop, historically a popular location for new developments, also has a number of proposed projects in very preliminary stages. These include the renovation and vertical expansion of Union Station at 210 S. Canal Street, Beitler’s development at 301 S. Wacker Drive, Development Resources’ proposed tower at 401 S. Wacker Drive, Sam Zell’s proposed development just north of 2 N. Riverside Plaza and Prime Group’s 50-story high rise development at 400 W. Randolph Street.

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“Weakness in Central Loop’s Central Loop Class B sector caused the Vacancy vacancy rate to increase nearly The Central Loop reported the most dramatic vacancy rate increase of all CBD submarkets. The first quarter ended at 14.3 percent, up from 13.1 percent in the fourth a full percentage point from quarter of 2007. Most of the increase was fueled by the 18.2 percent vacancy in Class B the prior quarter.” space, which increased 2.0 percent from the fourth quarter of 2007. Lease and Sale Activity Although the Central Loop reported an increase in vacancy for the first quarter, it still remained an attractive submarket for some existing tenants, as witnessed by the strong leasing activity during the quarter. Northern Trust Corporation signed the largest lease transaction of the quarter, expanding vacancy and absorption by 110,000 square feet to occupy a total of 420,000 square feet at 181 W. Madison * Through First Quarter 2008 Street. 1,200,000 20.0% CareerBuilder extended its lease and doubled its existing space to 150,000 square feet 1,000,000 18.0% at 200 N. LaSalle Street after receiving TIF funds from the City of Chicago and additional 800,000 16.0% 14.0% 600,000 incentives from the State of Illinois. The new lease will allow CareerBuilder to consolidate 12.0% 400,000 its three existing Chicago locations and accommodate planned growth resulting from new 10.0% 200,000 hires. Another growing firm, Madison Dearborn Partners, relocated to new space within 8.0% 0 Vacancy Rate 6.0% its existing building, 70 W. Madison Street. The investment firm leased 58,102 square feet Square-200,000 Feet Absorbed 4.0% 2004 2005 2006 2007 2008 of expansion space vacated by Sara Lee upon its relocation to Downers Grove, IL. -400,000 2.0% -600,000 0.0% There was only one noteworthy building sale in the Central Loop during the first quarter.

Absorption Vacancy Hiro Real Estate Company sold 20 N. Clark Street, a 384,000-square-foot, Class B property, to a joint venture between Hamilton Partners and Multi-Employer Property Trust for $58,800,000 or $153 per square foot. Bank of America announced plans to sell and lease back its space at 135 S. LaSalle Street, LaSalle Bank’s former headquarters. Bank of America expects to retain its existing downtown Market Snapshot occupancy level at the building, but is planning to shed space at some of its other CBD locations. Central Loop 4th Qtr 1st Qtr Absorption 2007 2008 The Central Loop had negative net absorption for the first time in eight quarters, ending Vacancy Rate 13.1% 14.3%  the first quarter with negative 412,772 square feet of net absorption. The majority of this Absorption 10,288 sf -412,772 sf  total was witnessed in Class B space, which accounted for negative 309,011 square feet of the total. This was attributed primarily to the termination of Chase’s 290,000-square-foot Inventory 35,792,889 sf 35,792,889 sf |} lease at 120 S. LaSalle Street. Despite softened demand during the first quarter, it is anticipated that the Central Loop will remain a viable economic alternative to the typically pricier West Loop, as witnessed by historically positive net absorption in the submarket. Much of the highly desirable Class A space vacated by Central Loop tenants occupying new space in the West Loop has been leased in prior quarters. Landlords will likely be focused on backfilling Class B space in future quarters. Construction No new construction was delivered to the Central Loop during the first quarter. The mixed-use 400,000-square-foot development anchored by Morningstar at 22 W. Washington Street (Block 37), is expected to be completed later this year. This development will be the first new delivery to the CBD in the past six quarters. Prime Group Realty Trust announced it will be converting twelve floors in the low rise of the 21-story 208 S. LaSalle Street to a Marriott Hotel, thus removing approximately 539,000 square feet of office space from CBD inventory.

5 COLLIERS BENNETT & KAHNWEILER INC. metropolitan chicago downtown office first Quarter 2008

East Loop “First quarter leasing activity Vacancy was strong in the East Loop, The East Loop ended the first quarter at a vacancy rate of 14.6 percent, down from 15.3 particularly in the form of percent in the fourth quarter of 2007. tenant expansions.” Lease and Sale Activity The East Loop had another strong quarter of leasing activity with the retention and expansion of numerous existing tenants. Virchow, Krause & Company signed a 46,800-square-foot lease at 205 N. Michigan Avenue to relocate from its existing sublease space at the adjacent 225 N. Michigan Avenue. The new lease represents a 27 percent increase in space for the accounting firm. In need of contiguous expansion space, Marketing Werks, currently located at 111 E. Wacker Drive, opted to remain in the East Loop with the signing of its new 44,463-square-foot lease at 130 vacancy and absorption E. Randolph Street, nearly doubling its occupancy. Monitor Group, another tenant at 111 E. * Through First Quarter 2008 Wacker Drive, signed a lease extension and expansion at the building, more than doubling 1,000,000 20.0% their space to a total occupancy of 36,000 square feet. Aon Center also witnessed strong 800,000 18.0% 16.0% 600,000 leasing activity with Veolia Environmental Services’ new lease of 34,533-square-feet. 14.0% 400,000 During the first quarter, two Class C properties were sold in the East Loop. Crown 12.0% 200,000 10.0% Commercial Real Estate and Development sold 168 N. Michigan Avenue to Kimco Realty 0 8.0% Vacancy Rate Corporation for $13 million or $176 per square foot. Additionally, Robert Danial sold 6.0% Square-200,000 Feet Absorbed Floors 13-21 of the Pittsfield Building at 55 E. Washington Street to Alter Group for $23 2004 2005 2006 2007 20084.0% -400,000 2.0% million or $173 per square foot. The Pittsfield floors will be converted to a dormitory to -600,000 0.0% house CBD college students. Absorption Vacancy In a continuing sign of market uncertainty, Piedmont Realty Trust the owners of Aon Center, opted to take the building off the market when they were unable to secure acceptable bids for the highly-recognized asset. Instead, the owner has elected to focus on holding the asset and attempting to lease the vacant space until current conditions in the capital markets stabilize. downtown Market Snapshot Absorption East Loop 4th Qtr 1st Qtr The East Loop ended the first quarter with positive 171,528 square feet of net absorption, 2007 2008 primarily due to the absorption of 105,568 square feet of Class A sublease space. Despite Vacancy Rate 15.3% 14.6% having the highest overall vacancy rate of any submarket, the East Loop experienced the  most net absorption during the first quarter, driven by recent strong leasing activity. Absorption 275 sf 171,528 sf  Landlords could face a potential struggle in future quarters as many large East Loop tenants Inventory 24,296,648 sf 24,296,648 sf |} are searching the market for space or have already committed to leases at new buildings located in other submarkets. Additionally, a large block of space at Aon Center was put on the sublease market by Kirkland & Ellis, who will be vacating in 2009. The need to retain existing tenants and attempt to recruit new tenants will likely continue to trigger more favorable incentive packages from East Loop landlords. Construction No new construction was delivered to the East Loop during the first quarter. The 800,000-square-foot vertical expansion of the Blue Cross Blue Shield headquarters at 300 E. Randolph Street is underway with expected delivery in 2010. Half of the new Blue Cross Blue Shield space will likely be marketed to new tenants.

COLLIERS BENNETT & KAHNWEILER INC. COLLIERS BENNETT & KAHNWEILER INC. 6 METROPOLITAN CHICAGO downtown office first Quarter 2008

“North Michigan Avenue North Michigan Avenue witnessed the largest decrease Vacancy in its vacancy rate of all CBD North Michigan Avenue’s vacancy rate ended the quarter at 11.6 percent, down significantly from 13.1 percent in the prior quarter. submarkets in the first quarter.” Lease and Sale Activity There were no noteworthy lease signings in the North Michigan Avenue submarket. However, it is expected that Northwestern Memorial Hospital will continue to expand as space becomes available. Additionally, the submarket is likely to see more demand as other tenants affiliated with the Northwestern Memorial Hospital and Children’s Memorial Hospital consider relocating to North Michigan Avenue to be in closer proximity. There were no noteworthy investment sales in North Michigan Avenue during the first vacancy and absorption quarter. * Through First Quarter 2008 The sale of 401 N. Michigan Avenue fell through due to a lawsuit between the seller, Zeller 200,000 16.0% Realty Group and the potential purchaser, Broadway Real Estate Partners. 150,000 15.0% 100,000 The Chicago Park District is under contract to purchase an office condominium containing 50,000 14.0% approximately 110,000 square feet at 541 N. Fairbanks Court. The Park District decided 0 13.0% -50,000 to purchase the space to receive property tax benefits offered to non-profit owners of 2004 2005 2006 2007 2008 -100,000 12.0% Vacancy Rate office space. Square-150,000 Feet Absorbed 11.0% -200,000 Absorption -250,000 10.0% Positive 160,006 square feet of net absorption was reported in North Michigan Avenue Absorption Vacancy submarket for first quarter, a substantial increase from the negative 33,852 square feet at the end of fourth quarter 2007. Much of this positive net absorption was driven by the occupancy of Northwestern Memorial Hospital at 541 N. Fairbanks Court. The hospital took possession of approximately 106,000 square feet and will expand into another 45,000 square feet later this year. downtown Market Snapshot Construction No new construction was delivered to North Michigan Avenue during the first quarter. North Michigan Avenue 4th Qtr 1st Qtr 2007 2008 Vacancy Rate 13.1% 11.6%  Absorption -33,852 sf 160,006 sf  Inventory 10,490,143 sf 10,490,143 sf |}

7 COLLIERS BENNETT & KAHNWEILER INC. metropolitan chicago downtown office first Quarter 2008

River North “River North landed a Vacancy 75,000-square-foot tenant from River North ended the first quarter with 12.2 percent vacancy, up slightly from 11.9 the West Loop when Quarles & percent in the fourth quarter of 2007. Brady signed a lease at 300 N. Lease and Sale Activity LaSalle Street.” There were three noteworthy lease signings in River North during the first quarter, two of which were at 300 N. LaSalle Street, Hines’ new development currently under construction. Quarles & Brady signed a 75,000-square-foot lease to relocate from the 58,000-square- foot West Loop space it currently occupies at 500 W. Madison Street. Additionally, Stockbridge Capital Partners signed a 25,000-square-foot lease to relocate from 180 N. Stetson Avenue. These new transactions bring 300 N. LaSalle Street to more than 80 percent pre-leased. Additionally, Barry Callebaut signed a lease to expand vacancy and absorption by 15,872 square feet at 600 W. Chicago Avenue, where the company will be adding a * Through First Quarter 2008 chocolate academy. 350,000 20.0% Prime Group Realty Trust sold floors 2-13 at 330 N. Wabash Avenue, the former IBM 300,000 18.0% Building, to a joint venture between Oxford Capital Group and LaSalle Hotel Properties 250,000 16.0% 14.0% 200,000 for $46 million or $123 per square foot The floors will be converted to luxury hotel 12.0% 150,000 rooms while the balance of the building will remain as office space. The conversion will 10.0% 100,000 8.0% result in approximately 375,000 square feet of office space being removed from CBD 50,000 6.0% Vacancy Rate inventory. Square Feet0 Absorbed 4.0% -50,000 2.0% 2004 2005 2006 2007 2008 Absorption -100,000 0.0% River North posted negative 42,833 square feet of net absorption during the fourth Absorption Vacancy quarter, a significant decrease from positive 174,114 square feet measured in the fourth quarter of 2007. Much of the negative absorption was driven by Bankers Life and Casualty placing approximately 114,000 square feet on the sublease market at the Merchandise Mart. They will be vacating the Merchandise Mart to consolidate operations at 600 W. Chicago Avenue. downtown Market Snapshot Construction River North There were no new construction deliveries to River North during the first quarter. However, 4th Qtr 1st Qtr Hines’ development at 300 N. LaSalle Street and Mesirow Real Estate’s development at 2007 2008 353 N. Clark Street are still under construction. These two towers will add a total of 2.6 Vacancy 11.9% 12.2% million square feet of office space to River North in 2009 when they are completed. Rate  Absorption 174,114 sf -42,833 sf  Inventory 13,238,519 sf 13,238,519 sf |}

COLLIERS BENNETT & KAHNWEILER INC. COLLIERS BENNETT & KAHNWEILER INC. 8 METROPOLITAN CHICAGO downtown office first Quarter 2008

Large lease transactions of FIRST Quarter 2008 Tenant Address Submarket Landlord Rep. SF Type of Deal Northern Trust Corp. 181 W. Madison St. Central Loop MB Real Estate 420,000 Renewal/Expansion William Blair 444 W. Lake St. West Loop Hines 340,000 New Lease CareerBuilder 200 N. LaSalle St. Central Loop Grubb & Ellis 150,000 Renewal/Expansion Quarles & Brady 300 N. LaSalle St. River North Hines 75,000 New Lease/Expansion McAndrews Held & Malloy 500 W. Madison St. West Loop MB Real Estate 73,177 Renewal/Expansion Madison Dearborn Partners 70 W. Madison St. Central Loop Hines 58,102 Relocation in Building/ Expansion Sara Lee 70 W. Madison St. Central Loop Hines 58,102 Disposition Skadden Arps Slate Meagher & Flom 155 N. Wacker Dr. West Loop John Buck Company 54,700 Expansion Virchow Krause & Company 205 N. Michigan Ave. East Loop MB Real Estate 46,800 New Lease/Expansion Marketing Werks 130 E. Randolph St. East Loop J.F. McKinney 44,463 New Lease/Expansion vacancFitch Eveny Tabin and & F lanneryabsorption 120 S. LaSalle St. Central Loop Lincoln Property Company 44,000 Relocation in Building/ * Through First Quarter 2008 Expansion Monitor Group 111 E. Wacker Dr. East Loop J.F. McKinney 35,876 Renewal/Expansion Litchfield & Cavo 303 W. Madison St. West Loop CB Richard Ellis 34,993 Renewal/Expansion Veolia Environmental Services 200 E. Randolph St. East Loop Jones Lang LaSalle 34,533 New Lease??? Jones Lang LaSalle 200 E. Randolph St. East Loop Jones Lang LaSalle 32,409 Expansion Stockbridge Capital Partners 300 N. LaSalle St. River North Hines 25,000 New Lease/Expansion Flashpoint Academy of Media Arts & 222 Merchandise Mart River North CB Richard Ellis 21,666 Sublease Sciences Plaza Defense Research Institute 55 W. Monroe St. Central Loop Jones Lang LaSalle 21,102 New Lease/Expansion Schneider Logistics 1 N. Dearborn St. Central Loop MB Real Estate 21,000 New Lease/Expansion Baker & McKenzie 130 E. Randolph St. East Loop J.F. McKinney 16,508 Renewal/Expansion Barry Callebaut 600 W. Chicago Ave. River North Jones Lang LaSalle 15,872 Expansion Aleri, Inc. 180 N. Stetson East Loop J.F. McKinney 15,206 Renewal McKenna Storer 33 N. LaSalle St. Central Loop Golub & Company 14,297 Renewal downtown Market Snapshot

*Colliers Bennett & Kahnweiler Transactions are bolded.

9 COLLIERS BENNETT & KAHNWEILER INC. metropolitan chicago downtown office first Quarter 2008

First quarter 2008 market statistics Total Direct Sublease Total Vacancy Total Vacancy Total Total Total Net Net Inventory Direct SF Sublease SF Total Vacant Vacancy Vacancy Rate - 1st Rate - Direct Net Sublease Net Absorption Absorption Class Bldgs Sq. Ft. Vacant Vacant SF Rate Rate Quarter Prior Qtr. Absorption Absorption - 1st Qtr. YTD-Sq. Ft. DOWNTOWN TOTAL Class A: 77 68,394,118 7,688,784 910,215 8,598,999 11.2% 1.3% 12.6% 12.6% (199,391) 187,344 (12,047) (12,047) Class B: 119 47,173,334 6,606,962 435,861 7,042,823 14.0% 0.9% 14.9% 14.1% (338,382) (30,014) (368,396) (368,396) Class C: 93 12,797,419 1,521,745 109,162 1,630,907 11.9% 0.9% 12.7% 13.7% 115,634 13,086 128,720 128,720 Subtotal: 289 128,364,871 15,817,491 1,455,238 17,272,729 12.3% 1.1% 13.5% 13.3% (422,139) 170,416 (251,723) (251,723) WEST LOOP Class A: 30 28,414,136 3,295,754 390,098 3,685,852 11.6% 1.4% 13.0% 12.9% (169,560) 149,723 (19,837) (19,837) Class B: 30 12,121,483 1,256,914 91,554 1,348,468 10.4% 0.8% 11.1% 10.1% (113,223) (15,655) (128,878) (128,878) Class C: 27 4,011,053 662,962 92,584 755,546 16.5% 2.3% 18.8% 19.4% 6,234 14,829 21,063 21,063 Subtotal: 87 44,546,672 5,215,630 574,236 5,789,866 11.7% 1.3% 13.0% 12.7% (276,549) 148,897 (127,652) (127,652) vacancy and absorption CENTRAL LOOP * Through First Quarter 2008 Class A: 21 19,027,573 1,934,490 247,440 2,181,930 10.2% 1.3% 11.5% 10.5% (62,002) (114,615) (176,617) (176,617) Class B: 32 14,877,410 2,637,697 64,156 2,701,853 17.7% 0.4% 18.2% 16.3% (309,011) 38,807 (270,204) (270,204) Class C: 10 1,887,906 221,763 8,208 229,971 11.7% 0.4% 12.2% 14.0% 35,604 (1,555) 34,049 34,049 Subtotal: 63 35,792,889 4,793,950 319,804 5,113,754 13.4% 0.9% 14.3% 13.1% (335,409) (77,363) (412,772) (412,772) EAST LOOP Class A: 12 12,602,828 1,524,339 237,440 1,761,779 12.1% 1.9% 14.0% 15.0% 20,476 105,568 126,044 126,044 Class B: 17 7,445,866 1,335,643 12,181 1,347,824 17.9% 0.2% 18.1% 17.9% (22,175) 6,014 (16,161) (16,161) Class C: 24 4,247,954 433,456 1,428 434,884 10.2% 0.0% 10.2% 11.7% 61,343 302 61,645 61,645 Subtotal: 53 24,296,648 3,293,438 251,049 3,544,487 13.6% 1.0% 14.6% 15.3% 59,644 111,884 171,528 171,528 NORTH MICHIGAN AVE. Class A: 10 5,494,305 498,862 10,998 509,860 9.1% 0.2% 9.3% 10.4% 15,018 46,668 61,686 61,686 Class B: 18 4,554,663 601,553 83,485 685,038 13.2% 1.8% 15.0% 17.1% 75,514 18,383 93,897 93,897 Class C: 5 441,175 16,760 0 16,760 3.8% 0.0% 3.8% 4.8% 4,423 0 4,423 4,423 Subtotal: 33 10,490,143 1,117,175 94,483 1,211,658 10.6% 0.9% 11.6% 13.1% 94,955downtown 65,051 Market160,006 S160,006napshot RIVER NORTH Class A: 4 2,855,276 435,339 24,239 459,578 15.2% 0.8% 16.1% 16.0% (3,323) 0 (3,323) (3,323) Class B: 22 8,173,912 775,155 184,485 959,640 9.5% 2.3% 11.7% 11.2% 30,513 (77,563) (47,050) (47,050) Class C: 27 2,209,331 186,804 6,942 193,746 8.5% 0.3% 8.8% 9.1% 8,030 (490) 7,540 7,540 Subtotal: 53 13,238,519 1,397,298 215,666 1,612,964 10.6% 1.6% 12.2% 11.9% 35,220 (78,053) (42,833) (42,833) QUARTERLY COMPARISON AND TOTALS Q1-08 289 128,364,871 15,817,491 1,455,238 17,272,729 12.3% 1.1% 13.5% - (422,139) 170,416 (251,723) (251,723) Q4-07 289 128,364,871 15,395,352 1,625,654 17,021,006 12.0% 1.3% 13.3% - 790,061 27,393 817,454 2,656,868 Q3-07 289 128,364,871 16,185,413 1,653,047 17,838,460 12.6% 1.3% 13.9% - 767,984 (61,436) 706,548 1,839,414 Q2-07 290 128,423,871 16,953,397 1,591,611 18,545,008 13.2% 1.2% 14.4% - 859,269 79,833 939,102 1,132,866 Q1-07 291 128,650,328 17,812,666 1,671,444 19,484,110 13.8% 1.3% 15.1% - 298,456 (104,692) 193,764 193,764 The information contained in this report was provided by sources deemed to be reliable, however, no guarantee is made as to the accuracy or reliability. As new, corrected or updated information is obtained, it is incorporated into both current and historical data, which may invalidate comparison to previously issued reports.

COLLIERS BENNETT & KAHNWEILER INC. COLLIERS BENNETT & KAHNWEILER INC. 10 METROPOLITAN CHICAGO downtown office first Quarter 2008

Chicago Downtown Office Submarket Map

* Through First Quarter 2008

11 COLLIERS BENNETT & KAHNWEILER INC. metropolitan chicago downtown office first Quarter 2008 mETROpOLITAN CHICAgO mARKET RESEARCH yEAR-END 2007

aBoutAbout ColliersColliers BennettBennett && KaHnWeilerKahnweiler Inc.

Colliers Bennett & Kahnweiler Inc. is an independently owned and operated business and a member fi rm of Colliers International Property Consultants, an affi liation of independent companies with over 267 offi ces throughout more than 57 countries worldwide. Locally, Colliers Bennett & Kahnweiler offers full service real estate services including offi ce, retail, investment, and industrial brokerage; development; project/construction management; and property/asset/facility management. In total, some 160 persons are employed by the fi rm – nearly half of which are brokerage professionals.

HEADQUARTERS DEPARTMENT LEADERSHIP BRANCH OFFICES Colliers Bennett & Kahnweiler Inc. Daniel Arends Colliers Bennett & Kahnweiler Inc. 6250 N. River Road, Suite 11-100 Richard Berger 200 S. Wacker Drive, Suite 700 Rosemont, IL 60018 Robert Chodos, SIOR Chicago, IL 60606 847/698-8444 (main number) Directors of Corporate Offi ce Group 312/698-9150 (main number) 847/698-8445 (fax) David Bilfeld 312/648-9149 (fax) www.colliersbk.com Director of Multi Family Advisory Group Colliers Bennett & Kahnweiler Inc. PRINCIPALS Kevin Clifton, SIOR 4643 South Ulster Street Director of Suburban Offi ce Group Suite 1000 David Kahnweiler, SIOR Denver, CO 80237 Chairman and CEO James Degnan, SIOR 303/745-5800 (main number) Director of Industrial Services Group William Fausone, SIOR 303/745-5888 (fax) President Jeffrey Kahan Director of Investment Services Group David Bercu, SIOR Colliers Manager Philip Stafford Senior Vice President Daniel Arends Colliers B&K Real Estate Management Ronald Behm, SIOR Services LLC Richard Berger Gerald Cernick Gregory Pacelli, SIOR Robert Chodos, SIOR Director of Land Group Kevin Clifton, SIOR Jeffrey Devine Aimee Course Steven Disse Director of Marketing and Communications Jeffrey Kahan George Cutro Jeffrey Kapcheck, SIOR Vice President, Market Research Steven Kling Mark Las Gregory Pacelli, SIOR Director of Information Technology Francis Prock Jack Rosenberg, SIOR Andrew Sexson Matthew Stauber, SIOR

COLLIERS INTERNATIONAL

With more than 10,000 employees worldwide, Colliers International is composed of the best local real estate companies COLLIERS in key world markets. Each member provides immense local insight as to customs, trends and cultural standards; a sound INTERNATIONAL experiential base and an extraordinary staff of professionals committed to all Colliers International clients. Market coverage of Colliers International spans the Americas, Europe, Africa, the Middle East and Asia/Pacifi c.

COLLIERS BENNETT & KAHNWEILER INC. COLLIERS BENNETT & KAHNWEILER INC. 12 www.colliers.com 42 COLLIERS BENNETT & KAHNWEILER INC. www.colliers.com