Office, Industrial & RetailPuget Sound Region, Washington

Bellevue | Seattle | Tacomawww.nai-psp.com

Market Report1Q 2018

THE INFORMATION SUPPLIED HEREIN IS FROM SOURCES WE DEEM RELIABLE. IT IS PROVIDED WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, AS TO ITS ACCURACY. PROSPECTIVE BUYER OR TENANT SHOULD CONDUCT AN INDEPENDENT INVESTIGATION AND VERIFICATION OF ALL MATTERS DEEMED TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, STATEMENTS OF INCOME AND EXPENSES.

Office ReportPuget Sound Region | First Quarter 2018

YTD Net Absorption (SF)Vacancy Rates

+1,764,8847.1%$32.07Source: CoStar

Source: CoStar and Esri

Custom Map

Source: ©2017 Esri

October 25, 2017

©2017 Esri Page 1 of 1

$25.44 Rental Rate ($/SF)6.8% Vacancy Rate+127,178 YTD Net Absorption

$38.90 Rental Rate ($/SF)7.3% Vacancy Rate+1,251,920 YTD Net Absorption

$22.24 Rental Rate ($/SF)6.4% Vacancy Rate-11,611 YTD Net Absorption

$27.52 Rental Rate ($/SF)10.9% Vacancy Rate+ 350,992 YTD Net Absorption

$35.94 Rental Rate ($/SF)5.7% Vacancy Rate+46,405 YTD Net Absorption

Northend

Seattle

Pierce

Southend

Eastside

Rental Rates (Price/SF/Year)

Bellevue | Seattle | Tacomawww.nai-psp.com

THE INFORMATION SUPPLIED HEREIN IS FROM SOURCES WE DEEM RELIABLE. IT IS PROVIDED WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, AS TO ITS ACCURACY. PROSPECTIVE BUYER OR TENANT SHOULD CONDUCT AN INDEPENDENT INVESTIGATION AND VERIFICATION OF ALL MATTERS DEEMED TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, STATEMENTS OF INCOME AND EXPENSES.

Noted Sale TransactionsBuyer Building Sale Price Market | Submarket

Advanta Bellevue LLC Advanta Office Commons $200,000,000 Eastside | Bellevue

Redstone WA Property, LLC Redstone Corporate Center I $46,075,226 Northend | Lynnwood

Brickman Vance Owner, LLC Vance & Sterling Buildings $43,300,000 Seattle | Seattle CBD

Noted Lease TransactionsTenant Building Size (SF) Market | Submarket

Amazon 9th & Thomas 157,301 Seattle | Lake Union

WeWork 1600 Seventh 100,145 Seattle | Seattle CBD

N/A Sammamish Park Place - Bldg A 97,190 Eastside | Coal Creek/Issaquah

Puget Sound Energy Parklands North Creek - Bldg O 96,350 Northend | Bothell/Kenmore

Source: CoStar and CBA

AVERAGE ASKING RATES

VACANCY VS. ABSORPTION

Creekside II Offices9633 Levin Rd NW, Silverdale, WA 98383 Creekside II Offices is a 100% NNN leased, multi-tenant office/medical building in Silverdale, Washington. Silverdale Creekside, LLC purchased the 22,567 square foot property on January 24, 2018 for $5,150,000 from Silverdale Creekside II LLC. NAI Puget Sound Properties represented the seller in this transaction.

Featured Office Transaction$29.60

$30.00

$30.40

$30.80

$31.20

$31.60

$32.00

$32.40

4Q16 1Q17 2Q17 3Q17 4Q17 1Q18

5.0%

6.0%

7.0%

8.0%

9.0%

0200,000400,000600,000800,000

1,000,0001,200,0001,400,0001,600,0001,800,0002,000,000

4Q16 1Q17 2Q17 3Q17 4Q17 1Q18Absorption Vacancy

THE INFORMATION SUPPLIED HEREIN IS FROM SOURCES WE DEEM RELIABLE. IT IS PROVIDED WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, AS TO ITS ACCURACY. PROSPECTIVE BUYER OR TENANT SHOULD CONDUCT AN INDEPENDENT INVESTIGATION AND VERIFICATION OF ALL MATTERS DEEMED TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, STATEMENTS OF INCOME AND EXPENSES.

Industrial ReportPuget Sound Region | First Quarter 2018

YTD Net Absorption (SF)Vacancy RatesRental Rates (Price/SF/Year)

-126,1883.1%$10.18Source: CoStar

Source: CoStar and Esri

Custom Map

Source: ©2017 Esri

October 25, 2017

©2017 Esri Page 1 of 1

$10.17 Rental Rate ($/SF/yr)4.2% Vacancy Rate+246,807 YTD Net Absorption

$12.73 Rental Rate ($/SF/yr)1.7% Vacancy Rate-92,594 YTD Net Absorption

$7.46 Rental Rate ($/SF/yr)2.1% Vacancy Rate+44,474 YTD Net Absorption

$8.74 Rental Rate ($/SF/yr)3.9% Vacancy Rate-115,952 YTD Net Absorption

$16.00 Rental Rate ($/SF/yr)4.1% Vacancy Rate-208,923 YTD Net Absorption

Northend

Seattle

Pierce

Southend

Eastside

Bellevue | Seattle | Tacomawww.nai-psp.com

THE INFORMATION SUPPLIED HEREIN IS FROM SOURCES WE DEEM RELIABLE. IT IS PROVIDED WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, AS TO ITS ACCURACY. PROSPECTIVE BUYER OR TENANT SHOULD CONDUCT AN INDEPENDENT INVESTIGATION AND VERIFICATION OF ALL MATTERS DEEMED TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, STATEMENTS OF INCOME AND EXPENSES.

Noted Lease TransactionsTenant Building Size (SF) Market | Submarket

Volvo Aero Services Corp. Kent North Corporate Park - Bldg D 238,121 Southend | Kent

N/A Des Moines Creek BP Phase IV - Bldg B 210,516 Southend | Seatac

N/A 4786 1st Ave S 166,056 Seattle | Georgetown

*Tiger Logistics Prologis Park Tacoma Bldg D 160,000 Pierce | Tacoma

Source: CoStar and CBA

Noted Sale TransactionsBuyer Building Sale Price Market | Submarket

Merrimack Pharmaceuticals, Inc. Partner Therapeutics $45,600,000 Northend | Lynnwood

Terreno Realty Corporation 4786 1st Ave S $42,000,000 Seattle | South Seattle

Terreno 1st Avenue South, LLC Sears Service Center $34,000,000 Seattle | South Seattle

AVERAGE ASKING RATES warehouse only

VACANCY VS. ABSORPTION warehouse only

Totem Place13209 NE 126th Place, Kirkland, WA Totem Place, an automotive industrial park, is located northeast of the intersection of NE 124th Street and Slater Avenue NE on NE 126th Place in Kirkland, WA. RD Totem Auto 2018, LLC purchased the 30,432 square foot property on March 15, 2018 for $7,500,000 which is a warehouse market record high of $246/SF from Totem Place, LLC. NAI Puget Sound Properties represented the seller in this transaction.

Featured Industrial Transaction

*NAI PSP transaction

2.5%

2.6%

2.7%

2.8%

2.9%

3.0%

3.1%

3.2%

3.3%

3.4%

(1,000,000)

(500,000)

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

4Q16 1Q17 2Q17 3Q17 4Q17 1Q18Absorption Vacancy

$-

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

$9.00

$10.00

4Q16 1Q17 2Q17 3Q17 4Q17 1Q18

THE INFORMATION SUPPLIED HEREIN IS FROM SOURCES WE DEEM RELIABLE. IT IS PROVIDED WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, AS TO ITS ACCURACY. PROSPECTIVE BUYER OR TENANT SHOULD CONDUCT AN INDEPENDENT INVESTIGATION AND VERIFICATION OF ALL MATTERS DEEMED TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, STATEMENTS OF INCOME AND EXPENSES.

Retail ReportPuget Sound Region | First Quarter 2018

YTD Net Absorption (SF)Vacancy Rates

+289,3593.3%$19.93Source: CoStar

Source: CoStar and Esri

Custom Map

Source: ©2017 Esri

October 25, 2017

©2017 Esri Page 1 of 1

$18.62 Rental Rate ($/SF)4.0% Vacancy Rate+88,306 YTD Net Absorption

$28.33 Rental Rate ($/SF)2.3% Vacancy Rate-22,204 YTD Net Absorption

$16.40 Rental Rate ($/SF)4.0% Vacancy Rate+138,217YTD Net Absorption

$19.23 Rental Rate ($/SF)3.2% Vacancy Rate+40,157 YTD Net Absorption

$26.81 Rental Rate ($/SF)2.2% Vacancy Rate+44,883 YTD Net Absorption

Northend

Seattle

Pierce

Southend

Eastside

Rental Rates (Price/SF/Year)

Bellevue | Seattle | Tacomawww.nai-psp.com

THE INFORMATION SUPPLIED HEREIN IS FROM SOURCES WE DEEM RELIABLE. IT IS PROVIDED WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, AS TO ITS ACCURACY. PROSPECTIVE BUYER OR TENANT SHOULD CONDUCT AN INDEPENDENT INVESTIGATION AND VERIFICATION OF ALL MATTERS DEEMED TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, STATEMENTS OF INCOME AND EXPENSES.

Noted Sale TransactionsBuyer Building Sale Price Market | Submarket

GRI Fairwood, LLC Fairwood Shopping Center $77,500,000 Southend | Renton

Roosevelt Square Regency, LLC Roosevelt Square $68,248,303 Seattle | Roosevelt

DS Canyon Park LP Canyon Park Place Shopping Center $52,546,624 Northend | Bothell

Noted Lease TransactionsTenant Building Size (SF) Market | Submarket

Floor & Decor Macy’s 77,500 Northend | Everett

Safeway 702 SHAW Rd 56,352 Pierce | Puyallup

Planet Fitness 2217 N Pearl St 22,352 Pierce | Tacoma

N/A 19820 40th Ave W 15,369 Northend | Edmonds/Lynnwood

Source: CoStar and CBA

10000 Main Street, Units 101-102Bellevue, WA 98004 10000 Main Street is an exceptional retail space located on Main Street in Old Bellevue. Hedge and Vine leased the 2,683 square foot space on March 12, 2018 from One Main Retail Ventures LLC. NAI Puget Sound Properties represented the landlord in this transaction.

Featured Retail Transaction

AVERAGE ASKING RATES

VACANCY VS. ABSORPTION

2.0%

3.0%

4.0%

050,000

100,000150,000200,000250,000300,000350,000400,000450,000500,000

4Q16 1Q17 2Q17 3Q17 4Q17 1Q18Absorption Vacancy

$18.20$18.40$18.60$18.80$19.00$19.20$19.40$19.60$19.80$20.00$20.20

4Q16 1Q17 2Q17 3Q17 4Q17 1Q18

600 108th Avenue NE Suite 340Bellevue, Washington USA 98004+1 425 586 5600

1700 Seventh Avenue Suite 2050Seattle, Washington USA 98101+1 206 332 1466

1201 Pacific Avenue Suite 1703Tacoma, Washington USA 98402+1 253 383 3100

nai-psp.com