5 5 WASHINGTON DC METRO MARKET OVERVIEW grubb-ellis.com

Susan Pepper 2010 President GREATER WASHINGTON COMMERCIAL ASSOCIATION OF REALTORS Senior Vice President Grubb & Ellis Company

Greater Washington Office Market Total SF: 297,376,507* Overall Vacancy: 14.9% Year To Date Net Absorption: (1,007,442) Under Construction: 7,931,938 SF Average Asking Rental Rates –Class A: $39.97 –Class B: $30.90 * Stats compiled by Grubb & Ellis Research do not include Owner Occupied Buildings Center of the Universe Source: Grubb & Ellis Research

D.C. Metro – Best of the Biggest Washington – 37,000

Unemployment Rate Year-End Source: U.S. Bureau of Labor Statistics 10.2% 7.6% 6.2%

Loss of Jobs Rising Vacancy But there’s more to it…

D.C. Metro Office Deliveries Source: Grubb & Ellis Research, CoStar Square Feet (Millions) *Anticipated Deliveries

Vacancy and Average Asking Rental Rates Dollars per Square Foot Vacancy Rate D.C. Office Market Source: Grubb & Ellis Research *Projection

Vacancy and Average Asking Rental Rates Dollars per Square Foot Vacancy Rate Source: Grubb & Ellis Research *Projection Northern VA Office Market

Vacancy and Average Asking Rental Rates Dollars per Square Foot Vacancy Rate Suburban MD Office Market Source: Grubb & Ellis Research *Projection

2009 at a Glance in Greater Washington 1st Quarter Overall Vacancy: 13.5% Net Absorption: (732,458) SF Average Asking Rental Rates –Class A: $39.70 –Class B: $ nd Quarter Overall Vacancy: 14.2% Net Absorption: 72,759 SF Average Asking Rental Rates –Class A: $40.01 –Class B: $ rd Quarter Overall Vacancy: 14.9% Net Absorption: (281,723) SF Average Asking Rental Rates –Class A: $39.97 –Class B: $30.90 Source: Grubb & Ellis Research

Available Sublease Space Source: Grubb & Ellis Research Increasing at a Decreasing rate… Square Feet

Office Sales Volume (In Billions) D.C. Metro Investment * Projection Source: Real Capital Analytics, Grubb & Ellis

1099 New York Avenue – 178,000 SF Sale Price: $90.5 million Buyer: Credit Suisse Seller: Tishman Speyer What would we do without foreign money? 1999 K Street – 249,000 SF Sale Price: $207.8 million Buyer: Deka Immobilien Investment Seller: Vornado Realty trust

*Projection Source: General Services Administration, Grubb & Ellis GSA Regional Inventory of Leased Space GSA…YEA! (SF in Millions)

Economic and job growth expected to continue in 2010 New deliveries increased vacancy in Greater Washington Rental Rates – relatively flat – major concessions to continue Office Investment Sales expected to see an uptick in activity Government leasing – drive market in 2010 Don’t shoot the MESSENGER! Summary