New York Quarterly New York Capital Markets Group DRAFT 10-13-2010 Market Overview Snapshot Fourth Quarter 2015

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 1 4Q2015 CAPITAL MARKETS

Market Snapshot

- Manhattan Capital Markets - Manhattan Leasing Market

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 2 4Q2015 MANHATTAN CAPITAL MARKETS Overview

• Record Breaking Year: There were 589 sales totaling $60.3 billion in 2015, a nearly 50% increase in volume year-over-year and by far the most active year on record. With 232 deals totaling $13.5 billion, the multifamily segment of the market was the leader by number of transactions, while the 101 office deals totaling $24.1 billion led the market in dollar volume.

• Foreign Investment in NYC Skyrockets: Foreign investors accounted for 45% of Manhattan investment activity (dollar volume) in 2015, a new record as foreign participation in the market has ranged from 10% to 20% over the last five years. Canadian and Chinese acquisitions comprised 62% of 2015’s foreign investment, with 21 other countries accounting for the remaining 38%.

• Large Transactions Dominate Across All Sectors: There were 23 deals greater than $500 million in 2015 totaling $25.7 billion (43% of the market). This activity was diversified across product types as investors, both foreign and domestic, were seeking the safety and security of NYC real estate. Office accounted for 13 deals totaling $12 billion of this activity followed by three multifamily deals at $6.6 billion, four hotel deals at $4.6 billion, one retail deal for $1.2 billion and one land deal for $870 million.

• Appreciating Values: Asset values witnessed exceptional appreciation with a 21% year-over-year average increase in price per square foot.

• Residential Market Continues Unprecedented Growth: The average sale price for Manhattan condominiums and co-ops reached a record $2,000,000 and $1,645 per square foot at the end of 2015. Despite the record pricing, there is softening in the ultra luxury segment of the market and increased inventory heading into 2016.

• Rising Interest Rate Environment: The Federal Reserve raised interest rates by 25 basis points at the December meeting, the first rate hike in nearly 10 years. Economists predict additional quarter point hikes in 2016 predicated on higher inflation and wage growth. Despite the rise in interest rates, buyers are still able to borrow with positive leverage.

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 3 4Q2015 MANHATTAN CAPITAL MARKETS YTD Closed Manhattan Investment Sales Activity The following details a summary of the year-to-date closed investment sales activity in Manhattan:

Total Size # % Square Units / Total % Avg Avg / SF Product Type of Deals of Deals Feet Keys Dollars of Dollars Deal Size or Unit or Key

Multifamily 232 40% 22,883,633 24,289 $13,471,526,052 22% $58,066,923 $751 / $658,847

Land 135 23% 14,471,789 $8,459,661,830 14% $62,664,162 $639

Office 101 17% 39,103,809 $24,132,246,573 40% $238,933,134 $867

Retail 73 12% 1,508,437 $5,270,147,318 9% $72,193,799 $3,671

Hotel 22 4% 8,482 $7,233,281,519 12% $328,785,524 $888,870

Other 26 4% $1,715,773,040 3% $65,991,271

TOTAL 589 100% 77,967,668 32,771 $60,282,636,332 100% $102,347,430

Under Contract 27 $7,092,200

Closed & Under 616 $67,374,836,332 Contract

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 4 4Q2015 MANHATTAN CAPITAL MARKETS 2015 Manhattan MF Investment Sales Activity By Submarket

Midtown Downtown Uptown Total

Total # of Deals 71 97 4 60 232

Total Units 3,544 15,142 814 4,789 24,289

Total Dollar Volume $3,021,228,188 $8,410,264,764 $711,907,184 $1,328,125,916 $13,471,526,052

Avg Price Per Unit $852,491 $749,282 $874,579 $316,608 $658,847

Total Square Feet Sold 3,334,345 14,190,429 884,332 4,474,527 22,883,633

Avg Deal Size $42,552,510 $86,703,670 $177,976,796 $22,135,432 $58,066,923

Avg Price PSF $901 $1,007 $804 $345 $751

Peter Cooper Village / Stuyvesant Town ($5,456,596,787 sale price and $471,866 per unit) and Riverton Houses ($201,000,000 sale price and $163,681 per unit) were excluded from the average price per unit and per square foot calculations.

NEW YORK CAPITAL Uptown properties are north of 125th Street New York Quarterly MARKETS GROUP Snapshot 5 4Q2015 MANHATTAN CAPITAL MARKETS 2015 Manhattan Office Investment Sales Activity By Submarket

Midtown Class A Midtown Class B Midtown South Downtown Total

Total # of Deals 18 36 39 8 101

Total Sq Ft 13,437,014 7,438,298 14,863,610 3,364,887 39,103,809

Total Dollar Volume $9,754,735,767 $4,443,226,919 $8,112,001,887 $1,822,282,000 $24,132,246,573

Avg Price PSF* $1,096 $770 $866 $542 $867

Avg Deal Size $541,929,765 $123,422,970 $208,000,048 $227,785,250 $238,933,134

* Excludes Bush Tower (130 West ), a repositioning opportunity; 209 East 43rd Street, a leasehold position and 1407 , a consolidation of the leasehold and sub‐leasehold positions, that remains subject to a ground lease. YTD 2015 Manhattan Land/Redevelopment Investment Sales Activity By Submarket Midtown Midtown South Downtown Uptown Total

Total # of Deals 51 59 20 5 135

Total Sq Ft 7,038,457 3,983,586 3,238,633 211,113 14,471,789

Total Dollar Volume $3,623,527,593 $3,168,239,876 $1,588,420,111 $79,474,250 $8,459,661,830

Avg Price PSF* $601 $795 $517 $376 $639

Avg Deal Size $71,049,561 $53,698,981 $79,421,006 $15,894,850 $62,664,162 * Price psf does not include the sale of 514 Eleventh Avenue as the property was put under contract in 2011, and 20 Broad Street as it is a leasehold.

NEW YORK CAPITAL Uptown properties are north of 125th Street New York Quarterly MARKETS GROUP Snapshot 6 4Q2015 MANHATTAN CAPITAL MARKETS 2015 Manhattan Retail Investment Sales Activity By Submarket

Midtown Midtown South Downtown Uptown Total

Total # of Deals 30 37 5 1 73

Total Sq Ft 899,978 517,071 76,124 1,508,437 1,508,437

Total Dollar Volume $3,248,792,322 $1,888,741,307 $120,113,689 $12,500,000 $5,270,147,318

Avg Price PSF $3,883 $3,846 $1,594 $819 $3,671

Avg Deal Size $108,293,077 $51,047,062 $24,022,738 $12,500,000 $72,193,799

2015 Manhattan Hotel Investment Sales By Submarket Midtown Midtown South Downtown Total

Total # of Deals 14 7 1 22

Total Keys 6,846 1,408 228 8,482

Total Dollar Volume $6,115,967,519 $967,314,000 $150,000,000 $7,233,281,519

Avg Price Per Key $1,236,441 $687,013 $657,895 $888,870

Avg Deal Size $436,854,823 $138,187,714 $150,000,000 $328,785,523

NEW YORK CAPITAL Uptown properties are north of 125th Street New York Quarterly MARKETS GROUP Snapshot 7 4Q2015 MANHATTAN CAPITAL MARKETS Unemployment Rate – US/NYC MSA/Manhattan

10.5

9.5

8.5

7.5

6.5

Unemployment % NYC MSA 4.8% 5.5 Manhattan: 5.2%

4.5 US: 5.0%

3.5 2000Q4 2001Q2 2001Q4 2002Q2 2002Q4 2003Q2 2003Q4 2004Q2 2004Q4 2005Q2 2005Q4 4Q2006 2Q2007 4Q2007 2Q2008 4Q2008 2Q2009 4Q2009 2Q2010 4Q2010 2Q2011 4Q2011 2Q2012 4Q2012 2Q2013 4Q2013 2Q2014 4Q2014 4Q2015

United States NYC Metropolitan Statistical Area Manhattan The December jobs report came in at +292,000 new jobs vs an expected 200,000. The Department of Labor expects the labor market to continue its strong pace into 2016 with an eye towards an uptick in wage growth.

NEW YORK CAPITAL Source: Moody’s.com New York Quarterly MARKETS GROUP Snapshot 8 4Q2015 MANHATTAN CAPITAL MARKETS New York Market Perspective New Office Building Construction by Decade

Average = 63.6 MSF per decade

71

270 Park Ave - 1,132,460 1285 - 1,473,950 62 643 West 43rd St - 1,128,000 58 1 Chase Manhattan Plaza- - 1,898,158 153 East 53rd St - 1,492,860 399 Park Ave - 1,250,000 1166 Sixth Avenue- 1,430,000 237 Park Ave - 1,142,196

60 Broad St - 1,014,041 1211 Sixth Avenue- - 1,734,105 55 East 52nd St - 1,050,000 200 Park Ave - 2,254,274 1 Bankers Trust Plaza- - 1,363,334 101 Park Ave - 1,137,000 1290 Sixth Avenue - 1,987,328 1633 Broadway - 2,240,000 590 Madison Ave - 1,016,413 277 Park Ave - 1,529,945 1 Penn Plaza- - 2,072,136 335 Madison Ave - 1,046,984 Inventory reduced by 31 MSF due to World 1301 Sixth Avenue - 1,764,411 1 Liberty Plaza- - 2,121,437 85 Broad St - 1,040,000 Trade Center (15 MSF) and residential 11 – 1,100,000 59 Maiden Ln - 1,043,007 55 Water St - 3,600,000 101 Barclay St - 1,140,000 conversions (16 MSF) 200 West Street – 2,000,000 th 245 Park Ave - 1,611,046 9 West 57th St - 1,500,000 787 Seventh Ave - 1,429,610 450 W 14 Street – 135,000 51 Astor Place – 430,000 26 Federal Plaza- 1,109,969 1114 Sixth Avenue- - 1,310,000 1 WFC - 1,461,365 50 W – 745,000

Square Feet (millions) 140 Broadway - 1,200,000 1185 Sixth Avenue- - 1,000,000 3 WFC - 2,300,000 Average = 14.2 MSF per decade 540 Madison – 300,000 1 WTC – 3,500,000 909 Third Ave - 1,125,000 1221 Sixth Avenue- - 2,200,000 4 WFC - 1,600,000 4 WTC – 2,300,000 th 767 Fifth Ave - 1,637,379 1251 Sixth Avenue- - 1,893,652 2 WFC - 2,200,000 21 250 West 55 Street – 1,050,000 7 – 470,000 1345 Sixth Avenue - 1,640,000 1515 Broadway - 1,417,450 7 WTC - 1,855,000 383 Madison Ave - 1,200,000 745 Seventh Ave - 1,036,741 2 Penn Plaza- - 1,500,000 1 WTC - 3,958,091 Financial Sqr - 1,000,301 5 Times Square - 1,062,203 1 NY Plaza- -2,103,750 2 WTC - 3,958,091 825 Eighth Ave - 1,550,212 Columbus Center - 1,016,000 11.56 10 731 Lexington Ave – 1,300,000 345 Park Ave - 1,600,519 2 NY Plaza- - 1,345,919 388 Greenwich St - 1,600,000 300 Madison Ave - 1,200,000 450 West 33rd St - 1,500,000 60 Wall St - 1,587,849 1585 Broadway - 1,220,732 7 Times Square - 1,000,000 7 WTC - 1,700,000 - 1,477,631 1101 Sixth Avenue- - 2,100,000 620 Eighth Ave - 1,500,000

1960s 1970s 1980s 1990s 2000s 2010 - Present

Net addition to supply over past 3 decades (1990’s + 2000 + 2010-Present) = 3.9 MSF per decade. Long term, new development will deliver product to Downtown and the Far West Side.

NEW YORK CAPITAL Note: Total construction square footage includes all new office buildings above 100,000 SF. New York Quarterly MARKETS GROUP Source: JLL Research Snapshot 9

4Q2015 MANHATTAN CAPITAL MARKETS Manhattan Office Space Deliveries

FIRST AVENUE

SECOND AVENUE

THIRD AVENUE 25 17 22 7 14 20 28 3 S TREET SIXTH AVENUE 6 8 14THSTREET

1 34TH 5 SEVENTH AVENUE

27 EIGHTH AVENUE

NINTH AVENUE 1521 11 24 4 42ND STREET 2

19 1816 9 23RD STREET 26 10 12 ELEVENTH AVENUE 2313 57THSTREET

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 10 4Q2015 MANHATTAN CAPITAL MARKETS Manhattan Development

1 7 Bryant Park Floorplate: 15-25K 8 855 Avenue of the Floorplate: 10-48K 15 1 Floorplate: 30-35K 22 1 Vanderbilt Floorplate: TBD Hines Bank of China (288K) Americas Under construction Brookfield Office Under construction SL Green Planned 473K s.f. Durst Organization Nike (148K) 2.1M s.f. Skadden (535K), 1.5M s.f. TD Bank (200K) 2021 2016

Delivered Delivered 204K s.f. Fried Frank 2018

th 2 860 Washington St. Floorplate: 13K 9 10 Hudson Yards Under construction 16 30 Hudson Yards Construction begins 23 555 West 34 St. Floorplate: 35-48K

Romanoff Equities Related Companies Coach (738K), + Related Companies 2015 Moinian Group Proposed 114K s.f. 1.7M s.f. L’Oreal (402K), SAP 2.6M s.f. KKR (300K), Time 1.8M s.f. TBD 2016

Delivered Delivered Floorplate: 30-45K (115K), BCG (250K), Floorplate: TBD Warner (1M), Oxford 2018 VaynerMedia (90K) (80K), Related (72K)

3 75 Rockefeller Pl. Floorplate: 14-30K 10 510 West 22nd St. 163K s.f. 17 425 Park Avenue Floorplate: TBD 24 75 Floorplate: 144K

RXR Realty BoA ML (311K) Vornado Realty/ Under Construction + L&L Holding Under renovation Jamestown Planned expansion 623K s.f. Albanese 650K s.f. Citadel (100K) 300K s.f. TBD 2017

Delivered Organization 2018

4 430 West 15th Floorplate: 12K 11 61 Ninth Avenue Floorplate: 13-20K 18 Floorplate: TBD 25 300 Lafayette St. Floorplate: TBD Street Palantir Tech. (99K) (400 West 15th St.) Under construction Related Companies Planned LargaVista Proposed 2.3M s.f. 83K s.f.

Atlas Capital Group Vornado Realty TBD 2017

Delivered

99K s.f. Trust/Aurora 2019 158K s.f.

5 125 West 25th 138K s.f. 12 Pier 57 (SuperPier) Floorplate: TBD 19 435-449 Tenth Ave. Floorplate: 30-40K 26 511 West 35th St. Floorplate: 30-40K Street Floorplate: 11K RXR/Youngwoo Under renovation Tishman Speyer Proposed Spitzer Enterprises Potential 2.6M s.f. 1.1M s.f.

Normandy/ 300K s.f. Google (250K) TBD 2017

Delivered

Waterbridge Capital 2019

6 One SoHo Square 13 Floorplate: 28-40K 20 2 WTC Floorplate: 41-65K 27 1.6M s.f. Imperium Floorplate: 26-33K Related Companies Under construction Silverstein Planned 20th Century Vornado Realty Trust Potential 3.1M s.f. Fox/News Corp. & Port Authority of Capital/Stellar Warby Parker (54K) 1.5M s.f. Boies, Schiller & TBD 2018

Delivered (1.2M) NY & NJ Management Flexner (83K), 2020 700K s.f. MLB.com (225K)

7 390 Madison Floorplate: 19-47K 14 3 WTC Floorplate: 29-68K 21 2 Manhattan West Floorplate: TBD 28 5 WTC Floorplate: 31K Avenue Under renovation Silverstein Under construction Brookfield Office Planned Port Authority of NY Potential 3.0M s.f. & NJ

L&L Holding BCG (300K) 2.9M s.f. McGraw Hill (S&P) TBD 2016 2018 858K s.f. (1.0M), GroupM 1.3M s.f. 2020 (516K)

NEW YORK CAPITAL Those noted as delivered were opened in 2015 New York Quarterly MARKETS GROUP Tenants in red are signed Tenants in black are rumored Snapshot 11 4Q2015 MANHATTAN CAPITAL MARKETS Annual Investment Sales Activity

Sales Activity Price PSF $70 $1,600 $1,344 $1,096 $875 (6) (21) $1,400 $60 (41) $1,083 $941 (15) $1,200 $50 $749 (15) $836 $743 (28) (7) $1,000 $40 (7) $549 $590 (15) (10) $800 $475 $335 $30 $421 $443 $434 (17) (2) $600 $340 (9) (15) (14) US $ billions $ US $20 (12) $400

$10 $200

$0 $0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Total Midtown and Midtown South Downtown Weighted Average Midtown Class A Office Price PSF # of Class A Transactions

# OF DEALS 111 78 58 83 165 170 259 346 191 66 136 245 275 223 442 589

VOLUME ($B) $10.3 $12 $8.5 $10 $15 $21 $35 $48.5 $19.6 $3.5 $12.4 $25 $25 $30.2 $39.8 $60.3

NEW YORK CAPITAL Source: JLL New York Capital Markets Group New York Quarterly MARKETS GROUP Numbers in parentheses represent the number of Class A transactions each year . In 2015, 8 of the 21 Class-A transactions were for a partial interest share. Snapshot 12 4Q2015 MANHATTAN CAPITAL MARKETS Annual Investment Sales by Investor Profile

Based on 2012 Total Sales of Based on 2013 Total Sales of $24.8 Billion $30.2 Billion

Pension Fund Pension 10% Fund 19% Private Capital Corporate / REIT 46% User 13% 5% Private Capital 61% REIT Foreign 20% 16% Foreign 10%

Based on 2014 Total Sales of Based on 2015 Sales of $39.8 Billion $60.3 Billion

Pension Fund 3% Private REIT Foreign Private Capital 15% 45% 63% Capital 44%

Foreign 19%

REIT 11%

Demand for NYC real estate continues from investors domestically and globally. Foreign investors are now participating in all product types, no longer just seeking trophy office product.

NEW YORK CAPITAL Source: JLL New York Capital Markets Group New York Quarterly MARKETS GROUP Snapshot 13 4Q2015 MANHATTAN CAPITAL MARKETS Foreign Capital Inflows

$27 B $1.585 B Average Deal Size by Country

59 Foreign Transactions 45% Deals YTD of $ Invested

$975 M

$615.5 M $552.5 M 10% $525 M of Deal Flow $491.7 M $385.2 M $334.95 M $284.2 M $205.8 M $193.3 M $163.5 M $150 M $148.4 M $120.3 M $109.5M $99 M $98.3 M $48 M $37.2 M $25.6 $18.5 M $14.5 M

NEW YORK CAPITAL Source: JLL New York Capital Markets Group New York Quarterly MARKETS GROUP Snapshot 14 4Q2015 MANHATTAN CAPITAL MARKETS Foreign Capital Inflows

Percent of foreign investment activity by dollar volume $284.235 M $669.892 M $328.5 M Dollars Invested by Country of Origin 1.05% $98.28 M 2.48% 1.22% $51.2 M 0.36% $163.5 M $525 M 0.19% 0.6% 1.94% $48 M $445.3 M 0.18% 1.65% $37.2 M $1.945 B 0.14% $14.5 M 7.2% .05% $1.029 B $1.105 B Norway Qatar $18.5 M $1.231 B 4% 4% .07% 4.56% $580 M $1.155 B $150 M 2.15% 4% 0.56% $99 M 0.37% $120.3 M 0.45% China China Canada $7.376 B $9.512 B 27.32% 35.26%

Number of Deals per Country Abu Dhabi 3 Bahrain 1 Brazil 1 Canada 6 China 15 England 1 Germany 3 Hong Kong 2 India 1 Israel 3 Italy 2 Japan 5 Kuwait 1 Norway 2 Qatar 2 Singapore 1 South Korea 2 Spain 1 Sri Lanka 1 Sweden 3 Switzerland 1 Taiwan 1 Turkey 1

NEW YORK CAPITAL Source: JLL New York Capital Markets Group New York Quarterly MARKETS GROUP Snapshot 15 4Q2015 MANHATTAN CAPITAL MARKETS Midtown Class A Cap Rates vs. Rent Growth & 10-Yr Treasuries Weighted Average Cap Rates, 2000 – 2015

Cap Rate 10-Yr Treasury 10.00% 10.00%

9.00% 9.00% 7.30% 8.00% 8.00% 7.58% 7.34% 7.00% 7.00% 6.34% 6.00% 5.85% 6.00% 6.20% 5.24% 4.93% 4.64% 5.00% 4.45% 4.40% 4.60% 5.00% 5.40% 4.30% 5.10% 4.04% 3.88% 3.79% 4.00% 4.70% 4.00% 5.10% 3.55% 3.90% 4.90% 3.90% 3.00% 3.70% 3.00% 3.40% 3.30% 2.90% 2.00% 2.50% 2.00% 2.10% 2.19% 1.00% 1.50% 1.00%

0.00% 0.00% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Y-O-Y rent 24% (4%) 11% (7%) 7% 4% 18% 29% 1% (27%) 1% 8% 3% 4% 2% 3% growth

Note: 10-Yr Treasury as of June for each year (does not include the spread) except 2015 which is year-end. Cap rates have remained steady at just shy of 4% for Midtown Class-A office. Even with the 25 basis point increase by the Federal Reserve in Q4, there remains ample room for investors to continue borrowing with positive leverage.

NEW YORK CAPITAL Source: JLL New York Capital Markets Group New York Quarterly MARKETS GROUP Snapshot 16 4Q2015 MANHATTAN CAPITAL MARKETS Notable Manhattan Transactions 4Q2015

Peter Cooper Village & 1568 Broadway 151 West 120 West 45th Street 206-208 Amsterdam Stuyvesant Town (Doubletree Guest (Leasehold Interest in (Tower 45) Avenue • Multifamily Suites Times Square) the London Hotel) • Office-A • Development Site • 11,200 Units • Hotel • Hotel • 458,446 SF • 400,000 BSF • Seller: CW Capital • 468 Keys • 564 Keys • Seller: SL Green • Seller: American • Buyer: The Blackstone • 304,584 SF • 334,125 SF • Buyer: Kamber Continental Properties Group JV Ivanhoe • Seller: Sunstone Hotel • Seller: Blackstone Group Management • Buyer: SJP JV Misui Cambridge • Buyer: Maefield • Buyer: ADIA • $365,000,000 Fudosan • $5,456,596,787 Development • $382,000,000 • $796 PSF • $275,000,000 • $487,196 Per Unit • $540,000,000 • $677,305 Per Unit • 3.2% going-in cap rate • $688 PBSF • As part of the transaction, • $1,153,846 Per Key • $1,143 PSF • 99% occupied • Located between West 69th the buyers will reserve • $1,773 PSF • The property includes a • Major tenants include DE & West 70th Streets. • 3.4% going-in cap rate 4,500 units at the complex 9,000 square foot carriage Shaw Research, • Zoning allows for a 600 foot • The hotel includes 6,000 for middle-income families house. Schrodinger, DeVry tall residential tower. for the next 20 years and square feet of meeting Education Group and Curex space. an additional 500 units for Group. . • The buyer plans on low income families. expanding the room count, retail space and adding additional digital signage. December 2015 December 2015 December 2015 October 2015 October 2015

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 17 4Q2015 MANHATTAN CAPITAL MARKETS Notable Manhattan Transactions 4Q2015

1710 Broadway 210 West 70th Street 250 West 39th Street 445 Fifth Avenue 660-676 Columbus • Development Site (The Bradford) • Office • Retail Condominium Avenue • 367,377 BSF • Multifamily • 207,895 SF • 18,371 SF • Retail Condominium • Seller: C&K Properties • 173 Units • Seller: Lincoln Property • Seller: Thor Equities • 67,001 SF • Buyer: Extell Development • 171,085 SF • Buyer: Alduwaliya Buyer: Harbor Group • Seller: Starret Company • $247,163,900 • Seller: RREEF Funds • $123,500,000 International • Buyer: The Klein Group • $673 PBSF • Buyer: Stonehenge • $594 PSF • $68,000,000 • $60,500,000 • Located on the NE corner Partners • 4.3% going-in cap rate • $3,701 PSF • $903 PSF of West 54th Street & • $133,000,000 • 99% occupied • 4.3% going-in cap rate • 2.2% going-in cap rate Broadway. • $768,786 Per Unit • Two tenants occupy 32% of • Charming Charlie's • Newly constructed with • The development site will • $789 PSF the space with no other occupies 16,171 square 17,921 square feet of likely be a mixed-use • 3% going-in cap rate. tenant leasing more than feet through 1/30. ground floor selling space. project including residential • The property includes 10% of the space. • Two existing tenants condominiums, a hotel 11,000 square feet of • Weighted average rent is include Party City and Icon component, retail and ground floor retail space. $39.60 per square foot.. Parking, with one vacant signage. There are no storefront. height restrictions.

December 2015 December 2015 December 2015 December 2015 December 2015

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 18 4Q2015 MANHATTAN CAPITAL MARKETS

Market Snapshot

- Manhattan Capital Markets - Manhattan Leasing Market

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 19 4Q2015 MANHATTAN LEASING MARKET Overview

New York City’s Economy With the jobs number reaching over 4.25 million, employment remained at record levels. Though 2015 employment will not surpass the record 121,000 job additions in 2014, the net addition to the employment market will reach nearly 100,000 by the time the final figures are released for 2015. At 4.8 percent, the city’s unemployment rate through November was at its lowest since the recession and will likely hover near this low through the end of the year. With the near-term delivery of several Class-A assets, tenants were cautious about early renewals or executing large block leases given the new supply coming online. As a result, large block leasing activity was down in 2015, however, 2016 will likely see an uptick in large block leasing activity.

Real Estate Trends Financial services recaptures market lead from TAMI as four of the top ten leases were financial services compared with only two last year. Midtown Trophy & “Super Trophy” buildings outperform the rest of the market, with the Midtown Trophy average asking rent increasing 6.5 percent in 2015 to $99.42 per square foot. Demand for Manhattan’s premier space rose to pre-recession levels. After outperforming Midtown the last two years, Downtown leasing activity dropped in 2015. Higher rent growth in Downtown versus the rest of the market may have contributed to this slowdown—the discount between Downtown and Midtown overall asking rents fell to its slimmest margin since 2000, or approximately 20 percent.

NEW YORK CAPITAL Source: Economy.com/JLL Research Services New York Quarterly MARKETS GROUP Snapshot 20 4Q2015 MANHATTAN LEASING MARKET Current Office Market Statistics 4Q2015

MARKET SEGMENT INVENTORY (R.S.F.) VACANCY ASKING RENT

Midtown Trophy* 72,610,281 7.7% $99.43 Midtown Class A 188,461,673 10.4% $80.24 Midtown Class B 96,664,951 8.9% $56.74 Midtown Overall 285,126,624 9.9% $73.19 Downtown Trophy* 32,991,214 16.3% $67.20 Downtown Class A 57,896,842 12.0% $62.54 Downtown Class B 40,027,480 9.9% $48.74 Downtown Overall 97,924,322 11.1% $57.60 Midtown South Class A 25,994,294 5.6% $78.41 Midtown South Class B 37,728,769 6.7% $62.11 Midtown South Overall 63,723,063 6.3% $68.06 MANHATTAN OVERALL 446,774,009 9.6% $68.73

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 21 4Q2015 MANHATTAN LEASING MARKET Yearly Comparison by Major Market

Manhattan Class A Vacancy Rates Manhattan Overall Vacancy Rates

16% 16% 4Q2012 4Q2013 4Q2014 4Q2015 4Q2012 4Q2013 4Q2014 4Q2015 14.30% 14% 14.30% 14% 12.70% 12.60% 12.40% 12% 12.30% 12% 12.10% 12.00% 11.70% 11.70% 11.60%

11.20% 11.10% 11.10% 11.10% 10.70% 10.70% 10.50% 10.40% 10% 10.30% 10% 9.90% 9.70%

9.60% 9.60%

9.50%

8.40%

8% 8%

7.20%

6.90%

6% 6% 6.30% 6.10%

5.60%

4% 3.90% 4%

2% 2%

0% 0% Midtown Midtown South Downtown Manhattan Midtown Midtown South Downtown Manhattan

Manhattan Class A Asking Rents Manhattan Overall Asking Rents

PSF PSF $90 $80 4Q2012 4Q2013 4Q2014 4Q2015 4Q2012 4Q2013 4Q2014 4Q2015

$80 $73.19 $80.24 $70 $70.31 $78.41 $68.73 $77.11 $68.06 $67.65 $75.71 $75.38 $74.58 $65.25 $64.97 $72.78 $71.68

$70 $71.15 $70.15 $61.81 $68.83

$60 $60.78 $59.44 $66.18 $57.88 $57.60 $56.44 $62.54

$60 $54.43

$58.60 $50 $50.19 $54.77 $47.17

$50 $51.31 $40 $40 $30 $30 $20 $20 $10 $10 $0 $0 Midtown Midtown South Downtown Manhattan Midtown Midtown South Downtown Manhattan

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 22 4Q2015 MANHATTAN LEASING MARKET Landlord Concessions by Year

Tenant Improvements Free Rent PSF Months $70 Midtown Downtown 10 Midtown Downtown C 9 $64.03 9.0 8.9 8.8 9.1 $60 $61.39

$58.09 8

$56.82 $56.82 L

$50 $50.80 7 7.0 6.9 6.7 $47.06 6.6 A $46.67

6 $42.42

$40 $40.64 $37.22

S 5 5.1 5.1 S $30 4 $20 3 $10.00 2 $10 A 1 $0 0 2Q2010 4Q2011 4Q2012 4Q2013 4Q2014 4Q2015 4Q2011 4Q2012 4Q2013 4Q2014 4Q2015

PSF Months C $50 Midtown Downtown Midtown South 9 Midtown Downtown Midtown South $45 $47.50 8 L $40 7.8

7 $38.58 $38.25 $38.00 $37.78

$35 $36.23 6.3 $34.53 6.2 $34.37

A 6 6.1 $33.05 $32.89 $32.60 5.6

$30

$30.11 $30.00

5 5.2 5.0 5.0

S 4.9 $26.56 $26.25 4.7 $25 4.7

4 4.1

S $20 3.9 $18.89

3.3 $15 3

$14.33 $14.00 $10 2 B $5 1 $0 0 1Q2010 4Q2011 4Q2012 4Q2013 4Q2014 4Q2015 4Q2011 4Q2012 4Q2013 4Q2014 4Q2015

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 23 4Q2015 MANHATTAN LEASING MARKET Asking Rent vs. Net Effective Rent Peak 4Q2008 to 4Q2015 (Direct/Renewal/Expansion)

Midtown - Class A Downtown - Class A

Asking Rent Asking Rent $100 (-11% ) $65 (+18% ) $62.54 $90.04 $90 $60 $80.31 $52.94 $55 $80 $76.94 $50 $70 $43.58 $75.46 $45 $48.69 $60 $40 $50 $35 $40 $30 Net Effective Rent $30 Net Effective Rent $25 (-2%) (-10%)

$20 4Q2008 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010 3Q2010 4Q2010 1Q2011 2Q2011 3Q2011 4Q2011 1Q2012 2Q2012 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 3Q2014 4Q2014 1Q2015 2Q2015 3Q2015 4Q2015 $20 4Q2008 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010 3Q2010 4Q2010 1Q2011 2Q2011 3Q2011 4Q2011 1Q2012 2Q2012 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 3Q2014 4Q2014 1Q2015 2Q2015 3Q2015 4Q2015

Asking Rent Net Effective Rent (NER) Asking Rent Net Effective Rent (NER)

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 24 4Q2015 MANHATTAN LEASING MARKET Historical Absorption and Leasing Activity

Absorption (MSF) Leasing Activity (MSF)

50 12.0 12 45 10 9 8 7 7 7.0 6 40 4 4 4 3 9 2.0 2 2 35 30 -0.2 -3.0 -1 -2 -3 25

-8.0 20 -10 -13.0MillionSquare Feet -13 MillionSquare Feet 15 -19 10 -18.0 5

-23.0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 25 4Q2015 MANHATTAN LEASING MARKET Midtown Class A Asking Rent Adjusted for Inflation (CPI)

$100

$95 $93.17 $90.57 $90

$85

$80 $77.11

$75

$70 $67.94

$65

$60 $53.74 $55

$50 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Recorded Asking Rent CPI Adjusted 2000 Rent

•Inflation adjusted rent (from 2000) is 16.7% higher than 4Q2015 asking rents.

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 26 4Q2015 MANHATTAN LEASING MARKET Midtown and Downtown – Class A Asking Rents 2004-2007 rent increase CLASS A ASKING RENTS Midtown Downtown Midtown 57% 2015 $80.24 $62.54 Downtown 54% 2014 $77.11 $58.60 $100 2013 $75.38 $54.77 2012 $72.78 $51.31 1997-2000 rent increase 2008-2009 rent decrease $90 2011 $70.80 $42.33 Midtown 67% Midtown -28% Downtown 42% Downtown -24% 2010 $65.81 $40.95 $80 2009 $65.19 $40.17 2008 $90.04 $52.94 $70 2007 $90.57 $51.21 2006 $70.28 $49.14 $60 2005 $59.71 $32.67 2004 $57.58 $33.09 2003 $53.74 $35.36 $50

$40

$30

$20

$10

$0 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015

Midtown Downtown

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 27 4Q2015 MANHATTAN LEASING MARKET Leasing Activity by Block Size

Manhattan Deals Greater Than 100,000 s.f. 4Q2015 Leasing Activity By Block Size New and Renewal Transactions New and Renewal Transactions (# of deals)

5% 42% New Renewals 8%

60 52 49 46 44 45 50 41 43 39 38 40 27 24 17 14% 26 22 16 26 30 22 16 16 24 20 2 8 25 23 25 27 23 27 10 20 22 20 19 18 0 Less than 10,000 sf (42%) 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 31% 10,000-24,999 sf (31%)

25,000-49,999 sf (14%)

50,000-99,999 sf (8%)

100,000 + sf (5%)

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 28 4Q2015 MANHATTAN LEASING MARKET Top 5 Leases (Rent PSF) 2011 to 2015 2015 Address S.F. Starting Rent AQM Capital 375 Park Avenue 3,000 $177.00 CRG LP 375 Park Avenue 2,082 $175.00 Top-Tier Transactions DAK Investments 375 Park Avenue 2,941 $172.00 Berkley Insurance 375 Park Avenue 18,214 $170.00 Number of deals with starting rents greater than $80 Perez-Llorca US LLP 375 Park Avenue 1,927 $170.00 2014 Address S.F. Starting Rent Artemus Capital Management 667 Madison Avenue 8,500 $185.00 Glenview Capital Management 767 Fifth Avenue 41,000 $185.00 Icahn Enterprises 767 Fifth Avenue 43,000 $180.00 Berkley Insurance Company 375 Park Avenue 7,187 $165.00 Tenantwise 375 Park Avenue 1,927 $163.00 2013 Address S.F. Starting Rent Banco Itau 767 Fifth Avenue 16,000 $195.00 Fintech 375 Park Avenue 6,375 $163.00 Temasek 375 Park Avenue 16,979 $160.00 SPG Partners 667 Madison Avenue 14,250 $150.00 Wellspring Capital Management LLC 390 Park Avenue 10,726 $150.00 2012 SSC 9 W 5,200 $185.00 Icahn & Company 767 Fifth Avenue 27,808 $178.00 Princeton Holdings 375 Park Avenue 5,700 $140.00 $80 to $99 $100 and Greater InvestIndustrial 375 Park Avenue 3,700 $140.00 180 Clayton, Dubilier & Rice 375 Park Avenue 34,245 $136.00

160

140 64 120 81 64 91 100 51 81 80 50 46 Number of deals Number 60 103 40 18 80 19 88 69 69 57 58 14 46 20 14 35 33 14 17 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 29 4Q2015 CONTACT INFORMATION JLL New York Capital Markets Group

Richard Baxter Jonathan Caplan Vice Chairman Vice Chairman +1 212 812 6443 +1 212 812 6440 [email protected] [email protected]

Yoron Cohen Scott Latham Vice Chairman Vice Chairman +1 212 812 6442 +1 212 812 6441 [email protected] [email protected]

Jones Lang LaSalle 330 Madison Avenue New York, NY 10017 (212) 812-5700

NEW YORK CAPITAL New York Quarterly MARKETS GROUP Snapshot 30 4Q2015