The Chicago Multifamily Market Susan Tjarksen, Managing Director Demographics & Economy Chicago Global Cities Rank Cushman & Wakefield | Client name Demographics & Economy Population, Income and Job Growth 7.7% increase in population 2010 - 2018 55% increase in individuals with $150,000+ in the same time period Cushman & Wakefield | Client name Chicago Workforce & Labor Pipeline A magnet for the highly educated Cushman & Wakefield | Client name Chicago Workforce & Labor Pipeline A magnet for the highly educated Cushman & Wakefield | Client name Chicago Workforce & Labor Pipeline A magnet for the highly educated Cushman & Wakefield | Client name Downtown General Demographics (Aggregate) $93,409 1.57 persons Median Household Average Household Income Size • 55% renter occupied 78.3% 34.5 years old Residences with a Bachelor’s Degree or Median Age More Cushman & Wakefield | Client name Downtown Submarket Demographics Spotlight: Loop, River North, West Loop, South Loop, Streeterville, Old Town Median Median Average % Renter Bachelor HH Age HH Size Occupied Degree+ Income River North $112,647 35.8 1.5 65% 86% West Loop $124,909 34.2 1.7 48% 85% Streeterville $113,388 42.0 1.5 52% 82% The Loop $114,195 35.1 1.6 63% 79% Old Town $97,083 34.2 1.7 54% 79% Cushman & Wakefield | Client name Demographics & Economy Major Corporate Expansions & Relocations (2015 - 2019) - Submarket: West Loop - Submarket: West Loop Gate / South Loop - Submarket: West Loop - Status: Phase 1 Complete / Phase 2 In - Status: In Process - Status: Completed Spring 2018 Process - In the process of relocating 1800 - Relocated global headquarters from - Established Midwest Regional HQ in 2014 employees (including at least 300 tech Chicagoland suburbs to a 250,000 sf new with 1000+ employees in a 327,000+ sf workers) to the renovated old Chicago Post construction office - totaling over 2,000 space Office, leasing over 200,000 sf of space employees - Google announced yesterday that it would add another 132,000+ sf to its Chicago campus in a new Sterling Bay development to be delivered in the next several months - The company also is planning on leasing 14,000 sf nearby for its first flagship retail - Submarket: River North store in the world - Submarket: Loop - Status: Lease Signed - Status: Completed Summer 2018 - Signed lease at Hines’ Wolf Point - Signed a 263,000 sf lease in the newly development that will establish a 500,000 sf delivered CNA center, bring Facebook up to space. 1,000 new jobs promised in the next at least 2,000 employees in Chicago five years, with room for up to 4,000 additional employees upon the project’s completion Cushman & Wakefield | Client name Chicago Megaprojects Making No Small Plans Chicago’s role as the pumping heart of the 20th century U.S. economy led to swathes of land formerly inhabited by factories, railways and bygone behemoths. Now, these sites have become fertile ground as new epicenters of innovation, work and 21st century culture. Major Projects Development Site: Lincoln Yards Cushman & Wakefield | Client name Major Projects Development Site: Lincoln Yards - Developer: Sterling Bay - Status: Majority of site cleared of existing structures, community meetings in progress, additional assemblage ongoing - Acreage: 70+ - Recent zoning changes have enabled this former industrial site to be re-envisioned as a lush campus with strong office, retail and entertainment components. The estimated $5 billion project will result in 12 million sf of space, including: 5,000 residences and commercial space to support 23,000 jobs. -Located between the thriving neighborhoods of Lincoln Park, Bucktown and Wicker Park, the plans for Lincoln Yards have included a rebuilt Metra Station and connection to the 606 trail. Cushman & Wakefield | Client name Megaprojects Development Site: The Post Office - Developer: 601W Companies - Status: Redevelopment partially complete - Acreage: 12 - The development closest to full realization is the revitalization of the Old Main Post Office sitting at the crossroads of the Chicago River, the Eisenhower Expressway and the Clinton Blue Line. At 2.5 billion sf, the landmark structure is the largest current single structure redevelopment in North America. Recently, Walgreens Boots Alliance announced that it would be moving 1,800 of its employees into the Post Office. Cushman & Wakefield | Client name Megaprojects Development Site: The River District - Developer: Tribune Media / Equity International - Status: Approved by Chicago DPD 10/18/18, Phase 1 site clearing to begin soon - Acreage: 37 - Zoning changes have also extended the ability to construct downtown mid- and hi-rises to this large site at the border of the CBD and Chicago’s neighborhoods. The impressive plan calls for 18 buildings totaling 9 million sf of commercial and residential space. A quarter of the land will be devoted to vibrant greenspace along the Chicago River. Cushman & Wakefield | Client name Megaprojects Development Site: The 78 - Developer: Related Midwest - Status: Greenfield; Approved by Chicago Planning Commission 11/14/2018 to include 13 million sf and 10,000 residential units - Acreage: 62 - Named for its potential to be Chicago’s 78th neighborhood, the 78 is designed to be a mixed-use commercial campus along the Chicago River. A portion of the site has been allocated to expanding the presence of Illinois’ public and private universities in the city. The site was also toured again by Amazon representatives on their second visit to Chicago. Cushman & Wakefield | Client name Chicago Multifamily More Deliveries, More Absorption Rent growth and occupancy have remained steady in the face of record breaking deliveries. Chicago has maintained its strong fundamentals as the current cycle crests. A diverse economy, rising population, increasing incomes and robust corporate relocations and expansions all have played a major role. Multifamily Vitals $3.01 93.3% 3.39% Average Market Rent Occupancy of stabilized Average Concession • Avg Market Rent: buildings for stabilized $2,531 ● 28 Avg leases buildings • 4.4% 2018 Rent signed per month for Growth properties in lease up Cushman & Wakefield | Client name Deliveries & Absorption in Downtown Chicago 2016-2018 2018 2017 3,603 Units Delivered 2016 4,600 Units Delivered 4,350 Units Absorbed 3,905 Units Delivered 3,510 Units Absorbed 2,856 Units Absorbed Source: [Cushman & Wakefield] Note: [ ] Cushman & Wakefield | Client name Case Studies A selection of newly stabilized assets prototypical of Chicago’s top submarkets. Case study Old Town Park – Phase 1 Address: 1140 N Wells Street Developer: Onni Group Construction Start: Feb 2016 Date Delivered: June 2018 Submarket: Old Town Units Rent Lease Up 405 units $3.66 Avg Eff PSF 5 months to lease-up • 821 SF Average Unit • $3,007 Avg Eff Per Unit • 81 move ins per month Size • Studio - 3 Bedrooms • Featured Penthouse Cushman & Wakefield | Client name Case Study Lease Up Schedule - Old Town Park Cushman & Wakefield | Client name Case study Marquee at Block 37 Address: 25 W Randolph St Developer: CIM / Golub & Co Construction Start: Sep 2014 Date Delivered: June 2016 Submarket: Loop Units Rent Lease Up 690 units $3.16 Avg Eff PSF 14 months to • 855 SF Average Unit • $2705 Avg Eff Per Unit lease-up Size • 49 Avg move ins per • Studio - 3 Bedrooms month Cushman & Wakefield | Client name Case Study Lease Up Schedule - Marquee at Block 37 Cushman & Wakefield | Client name Case study EMME Address: 165 N Desplaines St Developer: Gerding Edlen Construction Start: June 2016 Date Delivered: Sep 2017 Submarket: West Loop Units Rent Lease Up 199 units $3.96 Avg Eff PSF 10 months to • 663 SF Average Unit • $2,623 Avg Eff Per Unit lease-up Size • 20 move ins per month • Studio - 2 Bedrooms Cushman & Wakefield | Client name Case Study Lease Up Schedule - EMME Cushman & Wakefield | Client name Case study Spoke Address: 1001 W Chicago Ave Developer: Bond Companies Construction Start: Sep 2016 Date Delivered: Nov 2017 Submarket: River West Units Rent Lease Up 353 units $3.14 Avg Eff PSF 15 months to • 733 SF Average Unit • $2,298 Avg Eff Per Unit lease-up Size • 28 move ins per month • Studio - 3 Bedrooms • Townhome Units Cushman & Wakefield | Client name Case Study Lease Up Schedule - Spoke Cushman & Wakefield | Client name Susan Tjarksen, Managing Director Phone: +1 (312) 523 7617 Email: [email protected] Laura Ballou, Senior Research Analyst Phone: +1 (630) 244 2456 Email: [email protected] Jacob Albers, Research Analyst Phone: +1 (510) 735 4368 Email: [email protected] ©2018 Cushman & Wakefield. 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