1. The Future of Lower Manhattan The Redevelopment of the World Trade Center Site and its Impact on the Downtown Real Estate Market

2. Method Research In-person interviews – 10 interviewees Online survey – 23 Respondents Attempt to minimize bias

3. Historical Perspective Background and Early Years Downtown pre-20 th Century David Rockefeller’s role – PATH – Alliance for Downtown – World Trade Center Layout of downtown Blue collar image Post 1980 The World Financial Center Dean Witter, Guy Carpenter, Fiduciary Trust The exodus Post September 11 th, 2001

4. Changing Office Dynamic Reduced FIRE sector presence – Though number of firms remain “The Berlin Wall has come down” Impact of Condé Nast – WilmerHale: good but not the same Agglomeration economies & herd mentality

5. Attractions Lower rent – MT VS. DT Class A rent Δ $19.56 – Change in the future? Capitalization Rates Newer buildings – 70% of NYC inventory > 50 years old – LEED Gold Certification Transportation – 200,000 SF of Retail – 13 Subway lines, PATH trains, Fulton Transit Center

6. Attractions (Cont.) Financial incentives – Lower Manhattan Revitalization Act (1995) – WTC Rent Reduction Program – Morgan Stanley projected to save $82 Million Redevelopment of WTC (non-tenants) – Infrastructure and surrounding amenities – Cost-conscious consumer Growth of DT: Residential & Retail – Population doubled in the last decade – 30.2 % of residents walk to work (2 nd highest in NYC) – Where are the young people? – 550,000 SF of new retail combined with existing luxury shops – Parallels to Rockefeller and Time Warner Center

7. Why Would You Leave? Viewed midtown as an upgrade Employee preference Economics – Anomaly for Nomura Couldn’t wait for new buildings Fatigue Competition and client locations

8. Downtown Submarkets Financial District – Two Paths: conversion or low cost alternative City Hall – Neutral impact – Little demand overlap World Financial District – Positive – Class B and C

9. And the Survey Says… In-Person Stabilization Projection:Online Survey Stabilization Projection (with Tower Two): With the Tower Two: The Big Question Mark:

10. Conclusion Bright Future: Emergence of 24/7 community Investment in infrastructure New buildings (LEED) Government initiatives Potential Roadblocks: Lack of job growth Dodd-Frank Relocation of back-office Huge blocks of vacant space Prediction: Occupancy will stabilize between 90 to 100% by 2020