Providing real estate valuation, consulting, and due diligence services to: Individuals Lenders Corporations And their tax and legal advisors.

Providing real estate valuation, consulting, and due diligence services to:

•Individuals

•Lenders

•Corporations

•And their tax and legal advisors

Objective

Highlight trends in this market place Identify areas of risk and opportunity Bring strategic awareness to

– Market participants– Municipal leaders

Market Drivers

Office markets are driven by jobs “Jobs” are changing

- Cost reduction / Technology

- Education

- Legal/Tax structure

- Society

Definitions

• Large Floor Plate User – Corp. tenants over 15,000 SF in market• Public• Space needs decision not made here

• Small Floor Plate User < 5,000 SF• Private Companies• Professional• Owner Lives Here

Survey Parameters

• Class A & B Office with GBA > 5,000 SF• Locations – various logical office markets

– Greenwich

– Stamford

– Norwalk

– Westport/Fairfield

– Trumbull/Shelton

– Danbury LMA

What we will look at

Brief history – How we got here Where the jobs are locating currently Impact of job growth on this office market Emerging Trends Opportunity Index – graphical representation

of risk

Fairfield County- Historically

-

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

Squ

are F

ootage A

dd

ed

<1950s 1950s 1960s 1970s 1980s 1990s 2000s

Decade

> 40k25k - 40k15k - 25k5k - 15k

Square Footage Additions

Historical Space Additions• Large floor plate buildings added in SF

1980’s - 25,000,000 1990’s - 9,000,000 2000’s - 5,000,000 Total - 39,000,000

Fairfield County- HistoricallyPersistently High Vacancy Rates Since 2001

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

1998 1999 2000 2001 2002 2003 2004

Year

Vacan

cy R

ate

Vacancy Rate Equilibrium

Big PictureDynamic Job Market

• Information based jobs are now going to the lowest cost provider

• Higher end jobs are filling in the space – just not filling in enough space

• Will there be enough jobs to fill the space?

Trailing 12 Months• Strong leasing of 2.5 million SF

• Offset by downsizing, relocations, new space – Purdue Pharma’s OxyContin issue results in 300,000 SF giveback

– International Paper’s relocation down south dumps 120,000 SF

– 901 Merritt coming on line with 375,000 SF

• 18% increase in smaller deals (10k-20k SF)

• Musical Chairs

• Investment sales are hot

Jobs

1. Who is going to occupy the current and projected future vacant space?

– Leaner, more educated workforce

2. Where will those jobs be located?– In smaller floor plate buildings

Lease Transactions by Locale% of Transactions Market Share Activity

11%

39%

16%

9%

6%

10%

6% 3%

Greenwich

Stamford

Norwalk

Danbury - Brookfield

Trumbull - Shelton

Fairfield - Westport

Bridgeport - Stratford

Mid Fairfield

Total Transactions 478

Lease Transactions by SF Group

70%

15%

7%5% 3%

0-5,000 SF

5,000-10,000 SF

10,000-20,000 SF

20,000-50,000 SF

50,000+ SF

Average SF Leased by Locale

8,266

7,766

10,1514,401

7,081

3,992

2,3004,321

Greenwich

Stamford

Norwalk

Danbury - Brookfield

Trumbull - Shelton

Fairfield - Westport

Bridgeport - Stratford

Mid Fairfield

Median SF Leased by Locale

2,915

3,060

2,850

2,110

4,250

1,968

1,8001,090

Greenwich

Stamford

Norwalk

Danbury - Brookfield

Trumbull - Shelton

Fairfield - Westport

Bridgeport - Stratford

Mid Fairfield

By Building Age50,000 SF and Greater

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

1980-1990

After 1990

145 Buildings 78 Buildings

Fairfield County Overall Vacancy Rates

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

5,000-25,000 SF

>50,000 SF

Equilibrium

293 Buildings

919 Buildings

Fairfield County Pipeline

• Approximately 5.2 million square feet of office space have a reasonable expectation of coming online over the next 10 years.

Fairfield County Pipeline

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

Norwalk Fairfield Stamford Danbury Shelton Bridgeport Wilton Trumbull Monroe Ridgefield Southport

Municipality

New Development Square Footage

New Development Square Footage

5.2 Million SF Total

Periodic County Employment Growth43,000 New Jobs Added

5,000

15,000

25,000

35,000

45,000

55,000

65,000

75,000

85,000

95,000

105,000

2010-2013 Growth

2006-2010 Growth

Current Employment7,000 Jobs

7,000 Jobs

15,000 Jobs

Forecasted County Vacancy Rates

Now add the proposed space additions in:Norwalk & Fairfield

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

Year

Va

ca

ncy R

ate

Vacancy Rate Equi librium

Market Equilibrium 2012

Forecasted County Vacancy Rates

Now add the proposed space additions in:Norwalk, Fairfield & Stamford

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

Year

Va

ca

ncy R

ate

Vacancy Rate Equi librium

Market Equilibrium - 2015

Forecasted County Vacancy Rates

Now add the proposed space additions in:All Fairfield County

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

Year

Va

ca

ncy R

ate

Vacancy Rate Equi librium

Market Equilibrium Not Achieved

Alternative Workplace Strategies

• Historical Average of 195 per person

• What happens at 150 SF and 125 SF

• Why – reduced costs and lower space needs per employee

Effects of AWS

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

Year

Vaca

ncy

Rate

Equilibrium 195 SQFT Per Person 150 SQFT Per Person 120 SQFT Per Person

Assuming all pipeline additions

Opportunity Index< 5,000 SF 5,000-10,000 SF 10,000-20,000 SF 20,000-50,000 SF > 50,000 SF

Greenwich

Stamford 1,807,050

Norwalk 6,700 1,486,500

Danbury-Brookfield 40,150 16,200

Trumbull-Shelton 592,234

Bridgeport-Stratford 70,000

Westport-Fairfield 800,000

Numbers represent partial anticipated new space online in the next 10 years

•Green – Vacancy lower than 12% with a down trend

•Yellow – Vacancy 12% - 15% with up trend

•Red – Vacancy greater than 15% with up trend

For a copy of the Opportunity Index, or more information

www.AustinMcGuire.com

See client section