Colliers International - Orange County3 Park Plaza, Suite 1200Irvine, CA 92614(P) 949.474.0707 (F) 949.724.5600www.colliers.com

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Executive Corner......................................2 `

Industry Recognizes Colliers.................2 `

Expert Column.........................................3 `

Top OC Transactions...............................4 `

Colliers Market Watch ` ............................4

(See Exceeding Seller Expectations on page 3)

Colliers International

OCPERSPECTIVE

Colliers International has directed the sale of an 8,000-square-foot retail property, located at 18501-18521 Yorba Linda Blvd. in Yorba Linda, Calif., to Marsburn Trust, an Orange County-based private investor for $2.67 million.

Built in 1975, the six-tenant shop-building is a portion of a larger neighborhood center, anchored by Stater Bros. Massage Therapy, Picante Grill, Jabez Salon, M&M Smokes, Ameci Italian Kitchen and a dentist office also occupy the property, situated at the signalized corner of Yorba Linda Boulevard and Lakeview Avenue.

(See Continued Expansion on page 3) (See REC’s SoCal Update on page 4)

Orange County Quarterly Newsletter

In support of Colliers’ expanding platform, we are continuing to elevate our services in Orange County, most recently in the Corporate Solutions division, the firm’s global corporate services operation. David K. Kim has been named senior managing director and Reid J. Wilbraham has been named senior director. The two strategic hires continue Colliers International’s global expansion.

Based in Colliers’ Irvine office, Kim specializes in the management and delivery of integrated client services for Corporate

Four professionals from Colliers’ Irvine office headlined the Real Estate Council (REC) of Jewish Federation’s SoCal Commercial Market Update in Costa Mesa on May 4th. Comprised of an active group of business executives, the Council invited Colliers to present on the current state of the investment and leasing markets in Southern California to an audience of REC members and members of the real estate community.

Martin Pupil, regional managing director, provided an update on the Orange County office market, discussing current fundamentals and recent major transactions.

Two OC Leadership Hires Continue Colliers Expansion

Colliers Headlines REC’s SoCal Update Inside This Issue

Colliers’ Exceeds Seller Expectations in Stater Bros. Sale

The weighted average asking rental rate decreased to $0.62 PSF per ` month, Triple Net (NNN) from $0.65 PSF reported in Q4. Since last year, the average rental rate has decreased 13.9% from $0.72 PSF. Weighted average asking rental rates are the highest in the South submarket ($0.81 PSF) and lowest in the North submarket ($0.54 PSF).

ECONOMYUnemployment was at 9.5% as of April 2010, up from 8.2% one year ago `

but down from 10.1% last month.Job growth is essential for an economic turnaround, so it is encouraging `

that Orange County added 4,700 jobs in April. Although commercial real estate fundamentals haven’t turned a corner, `

investors believe the market is near the bottom so their interest in acquiring top-tier or near top-tier properties is increasing.

5 From left: Christina Pambakian, Tom Lagos, Martin Pupil, David Pinsel, Mehran Foroughi, Maurice Nieman, Ian Schroeder, Jereme Snyder

In January 2010, Colliers International announced a shift in its organizational stucture, igniting some significant changes within our organization. The momentum

has continued over the course of the year and is already translating into major accomplishments for our organization across the globe.

Colliers International is now the #2 most recognized commercial real estate brand, according to The Lipsey Survey. We are ranked #2 in the brokerage industry with $53.8 billion in combined value of lease transactions and investment sales

globally, according to National Real Estate Investment magazine. We ranked in the Top 100 Global Oustsourcing list by the Internatioanl Association of Outsourcing Professionals for the 5th year in a row. And we are the first Global Parter with the World Green Buidling Council.

We have become a global leader in the commercial real estate industry and the excitement and momentum building within our organization is not going unnoticed. Within the Greater Los Angeles region 15 professionals have made the strategic decision to join our growing platform in the area of brokerage services since the beginning of this year.

In our Irvine office, we have not only added talent to our group of brokerage professionals, but also in other

aligning service lines. We welcomed Mark Strauss, Bruce Krall and Kevin Greenburg of Cohen Financial, along with David Kim and Reid Wilbraham of Corporate Solutions, further elevating our value proposition for our Orange County clients.

On behalf of all our professionals in Orange County, we look forward to continued momentum within our organization and to providing you with the highest level of service througout the second half of very promising year.

Colliers OCPerspective, Spring 2010

Corner

Exec

utiv

e Building Momentum

Martin PupilRegional Managing Director

Commercial Real Estate Industry Recognizes Colliers ProfessionalsWe all know 2009 was a tough year for the commercial real estate industry. Despite all the challenges, several professionals from Colliers’ Irvine office managed to elevate their business above the rest. The tremendous perseverance and dedication of these hard-working individuals earned them honors from industry organizations SIOR and Costar, along with Colliers National Retail Services Group.

On March 18, the Inland Empire/Orange County chapter of SIOR hosted its annual awards program. Two Colliers International professionals, Clyde Stauff, executive vice president, and Patrick Remolacio, managing director, corporate finance, received awards for their work on a land sale and industrial lease assignment for Birtcher Development & Investments and Cornerstone Real Estate Advisors LLC.

A month later, Costar Group recognized broker firms and individual dealmakers who lit up the industry with the 2009 Power Broker Awards. In the category of Industrial Leasing, both Stauff and Steve Schloemer, senior vice president, earned the prestigious award as individual

dealmakers for the industrial square footage they each transacted in 2009. In addition, Colliers International earned a ranking among both the top leasing and top sales firms awarded.

On May 23, Colliers National Retail Services Group held its second annual National Retail Meeting at ICSC’s RECon 2010 in Las Vegas. Colliers Irvine offices earned five awards for outstanding

achievements in 2009. Jereme Snyder, senior vice president, ranked #1 broker in the U.S. for retail investment sales, based on total gross sales commissions in 2009. Mehran Foroughi, senior vice president, ranked #2 in broker in the U.S. for retail investment sales and won Deal of the Year. Ian Schroeder and Maurice Nieman, both vice presidents, ranked #3 and #4 in the U.S. for retail investment sales.

Solutions, working closely with Colliers’ full-service tenant service professionals on a national and international basis.

Wilbraham is also based in Colliers’ Irvine office and focuses on

business development for Corporate Solutions throughout the United States.

“David and Reid bring more than 32 years of commercial real estate experience to Colliers,” said Martin Pupil, regional managing director of Colliers’ Greater Los Angeles operations. “With David’s extensive background managing integrated client services on a national basis, paired with Reid’s business development efforts, we look forward to significant growth in the corporate services segment of our full-service business platform.”

Prior to joining Colliers, Kim served as corporate

managing director for Studley, where he specialized in integrated client services, corporate solutions and industrial services across the United States. During his 25 years at the firm, he worked with notable clients including Kia Motors America, Aetna, CIGNA, La-Z-Boy Furniture, Toshiba America Business Solutions and the California Insurance Guarantee Association.

“I decided to join Colliers based on the company’s national and international presence and ability to service account portfolios across multiple real estate service lines,” said Kim.

Previously, Reid partnered with Kim at Studley, where he focused on tenant representation for both office and industrial users. During his seven years at the firm, he worked with corporations in the insurance, automotive, media, durable goods, logistics and apparel industries, gaining experience in providing a broad range of real estate solutions.

Colliers OCPerspective, Spring 2010

Expert Column Take Advantage of Property Tax Savings If you own commercial property, this is the time of year to be thinking about property taxes. The Orange County Assessor began its annual review of 317,000 countywide properties on January 1, 2010 and is preparing to release new assessments this July. If your real property assessment exceeds market value, now is the time to take action.

The good news for property owners is assessments were reduced on 202,800 properties in 2009. Also good news is last year the Consumer Price Index was negative and thus, for the first time since Proposition 13 began, the annual inflation adjustment will go down -0.237% instead of the accustomed upward 2% adjustment.

The bad news for owners is a significant number of properties will continue to be over assessed. While any owner can contact the Assessor’s office to request a reduction, the extent of savings offered is often less than optimal from an owner’s perspective.

How Does A Property Qualify? For a property to qualify for a reduction, its market value must be below its assessed value. In today’s tough market – for better or worse – this is a somewhat common occurrence. Conversely, if a property’s value decreased last year, but its current market value still exceeds its assessed value, a successful property tax appeal is unlikely.

If you believe the market value of your asset may be below its assessed value, I encourage you to take action now. The new assessments, with a January 1, 2010 date of

value, will be released next month. The Assessment Appeal process will be open from July 2 through September 15, 2010. While it may seem as though the appeal process is long and you have plenty of time, I urge you to take action now. We all know time passes quickly, especially during summer in Southern California!

We Can HelpColliers International Valuation & Advisory Services (FirstService PGP) has a Property Tax Services Group designed to take the complexities and burdens of property tax evaluation off the property owner and create genuine value that results in measurable savings. We can help with a range of items from initial assessments to agency filing to expert opinions.

I recently attended a closed Tax Appeal Board Meeting where applicants were achieving a high degree of success in obtaining tax savings. The properties ranged from individual owners appealing 6,000-square-foot industrial properties to attorney-represented Class A retail properties. Based on my observations, along with the unavoidable state of our commercial real estate market, I believe property tax savings is not only achievable, but also a necessary step in maximizing your bottom line.

(continued from page 1)

Continued Expansion

“We received more than 15 offers on the property and achieved a price of $337 per square foot, which exceeded the seller’s expectations,” said Jereme Snyder, senior vice president in Colliers’ Irvine office, who

represented the seller, EmBee Management, Inc., in the transaction.

The buyer was represented by Michael Lawton of Lawton Real Estate.

(continued from page 1)

Exceeding Seller Expectations

William J. Drewes is valuation services director for Colliers International Valuation & Advisory Services (FirstService PGP) in Colliers’ Irvine Office.

Clyde Stauff, executive vice president, spoke about the County’s industrial market, offering a detailed comparison of the industrial market in 2009 to current industrial market conditions.

Maurice Neiman, vice president, gave an overview of the national and local retail market. He elaborated on expanding retailers, current market fundamentals and gave a mixed outlook for 2010 in that sales will continue in single-tenant NNN retail properties, while multi-tenant shopping centers will not experience the same movement.

Pat Swanson, vice president, offered statistics on multifamily transactions, comparing current

market data to historical figures and provided an update on the broken condo market.

The REC meets regularly to discuss trends in the real estate and construction industry and to conduct philanthropic work. The strength and success of the REC comes from its ability to involve concerned professionals in the industry who join together in building a better Jewish community.

5 Martin Pupil gives an office market update at REC’s So Cal event.

Colliers OCPerspective, Spring 2010

Colliers International - Orange County3 Park Plaza, Suite 1200Irvine, CA 92614(P) 949.474.0707 (F) 949.724.5600www.colliers.com

Retail Sale Dana Point

8,120 sq. ft. `$2.48 million `Jesse Munoz `

Industrial Lease Santa Ana

38,551 sq. ft. `$1.86 million `

Clyde Stauff `

Office Lease Irvine

34,612 sq. ft. `$2.15 million `

John Wadsworth, ` Andrew Herron Brett Kluewer

Office LeaseSanta Ana

14,158 sq. ft. `$1.17 million `

Brett Kluewer, ` Andrew Herron

Top

This document has been prepared by Colliers International for advertising and general information only. Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. Colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from. Colliers International is a worldwide affiliation of independently owned and operated companies.

Colliers Market WatchOFFICE

Net absorption during Q1 was -1,000,800 SF as the office market ` experienced major space givebacks from tenants at a much higher rate than the previous quarter (-653,400 SF). This indicates that most companies are still not close to being in a position to expand their offices.

The weighted average asking rental rate at the end of Q1 was $2.13 PSF ` per month FSG down from $2.21 PSF (-3.6%) reported the previous quarter and from $2.44 PSF reported one year ago (-12.7%).

Leasing activity for Q1 totaled 1.35 million SF, up 3% from the 1.31 ` million SF of leasing activity reported last quarter and down 8% from 1.46 million SF of leasing activity reported one year ago.

INDUSTRIALSales and leasing activity during Q1 totaled 3.25 million SF, up 27% from `

the 2.55 million SF reported in Q4 2009.The total vacancy rate, including sublet space, increased 30 basis points `

from 6.0% reported in Q4 to 6.3% in Q1.

The weighted average asking rental rate decreased to $0.62 PSF per ` month, Triple Net (NNN) from $0.65 PSF reported in Q4. Since last year, the average rental rate has decreased 13.9% from $0.72 PSF. Weighted average asking rental rates are the highest in the South submarket ($0.81 PSF) and lowest in the North submarket ($0.54 PSF).

ECONOMYUnemployment was at 9.5% as of April 2010, up from 8.2% one year ago `

but down from 10.1% last month.Job growth is essential for an economic turnaround, so it is encouraging `

that Orange County added 4,700 jobs in April. Although commercial real estate fundamentals haven’t turned a corner, `

investors believe the market is near the bottom so their interest in acquiring top-tier or near top-tier properties is increasing.

(continued from page 1)

REC’s SoCal Update