Pr ted CORT a) Pen ess ‘The vacancy rate for industrial space on the ECONOMY ‘San Francisco Peninsula is 8.7%, which is 20% below the national average vacancy rate ‘The San Francisco Peninsula’s unemployment rate was 8.7% at the end of 2009 and ended 2010 at 9.3% With demand for products and series sl down, employers Of 1.1%. As jobs get created during tis have not hal the need io increas their headeout recovery, the SF Peninsula vacancy rat wil Continue fo devine and surpass the national Redwood City-based Peat Therapeutics a life sciences company that fcuses on average developing rextmens for chronic respiratory diseases, led vente capital re) funding Seen Enis, Serior Decor for the quarter with $69 milion, In all life scence companies generated $191.0 milion in ve funding compared 10 $96.3 milion received by sofware companies and $89.0 OVERVIEW ‘The region's industrial inventory totals 64.3 million squate feet (mst). ‘This is primacily ed lS comprises warehouse distribution space (61.3%) andi followed by high-technology Netra 2009 2010 NF space (35.1%) and manafacaring space 3.6%) GOPGowh 26% © 26% © 2.8% CPI Geowh 03% 16% 15% Roche vacated its former Hillview Avenue headguarers campus, which totals 8584175 : sna Ako rghit er 210 In ding te oe cic ee ae inate space increased to 87% from 81% a the end of 2009. Lessing atviny’s 25.1% increae helped 0 oft the negative impact that the Roche campus had on the Erpaenk A A ae overall market. There are no new speculative development projects in the pipe Sov Moody's | zonm com 2011, which should help to prevent any vacancy spikes next year edocs LEASING ACTIVITY for the year Foner ra pape ees ‘n98 23.1% mher han n 2009 and actions forthe quarter, Freeman Decomtiag Services leased 90, sf, Shamrock Spree feerier cade d leased 40,670 sf and Bintag Badminton Club leased 37,000 sf fist half of 2011 ‘The Crow Zellethach Disttbution Facility was 100% vacant in the firse quarter of ‘The Crown Zellerbach Distribution Facility, a 359,605-sf warehouse distribution facility located in South San Francisca rec od three of the top ten new leas Moving and Stor DIRECT ABSORPTION is negative in i 41192428 a at year-end and is Id Mechanical leasing 30,600 sf in Menlo Park. Sale activity was bipeciedtoreman negara inna 2009 and is now 71.2% occupied, High-technology leasing highlights forthe quartet included Cheiteh lighted by BioMed Realty Trust purchasing an hig tne building biotechnology 2011 until employers begin hiring ‘campus at the Science Center at Oyster Point and Gateway Business Park in South San again Francisco totaling 438,625 sf ‘CONSTRUCTION: No speculative a projects are currently under way or FORECAST ‘scheduled to break ground during 2011 Driven by increased leasing activity in 2010, the San Francisco Peninsula industrial market will need to continue the momentum of the warchouse ‘distribution and high: technology markets in order to see a market recovery in 2011, ‘This market recovery Ce SoS will only happen as the demand for expansion spaces increases as employers look to increase headcounts. Vacancy, asking rental rates and leasing activity are expected to teeta remain stable during the first half oF 2011 SAN FRANCISCO PENINSULA INDUSTRIAL REPORT 4010MARKET BEAT Cc PENINSULA OFFICE REPORT 4Q10 MARKET/SUBMARKET STATISTICS overat omect vo 10 v0) yo ommectw10-Ave, NO.OF VACANCY VACANCY LEASING UNDER CONSTRUCTION RECT. OVERALL CLASSAGROSS. MARQET/SUBUARKET IWVENTORY BLOGS. "RATE RATE” -AGTWMTY. CONSTRUCTION “COMPLETIONS. ARSORPTION ABGORETION RENTAL RATE" ScunSanFrancsco 40486512 33%_— 15% 190221 ° 0 888) 21,908, $2.19 San Bruno 1580458 15 112% «104% 984,757 ° 0 (og) aa gas s2o7 Daly Cy e7297 127% «87% «92039 ° 0 Gx) tay 28 waitbrae teoces 779% 79% ° ° 0 (13000) (13000) $000 Buringar 25000 55 136% «13.3% 173,590 ° 0 6o9se 75.380, 208 Bestone 790804 108% TBM 98.732 ° ee 8235 ‘Sen Mateo ee ee ° 0 75 Bare $235 Foster Cty 2053603 221.6% 10.1% 260,054 ° Dorm ao) S276 Belmont S76 = 738A O% 83,181 ° D662 2067 $225 Sen Caos 596540 «951.0% 47.7% 105,588 ° D (13014) aga) «$230 Redwood City 3610279 Gs «180% 81% «220402 ° 077876 (159588) $3.08 Menlo Park 204908 67 «190% 80% 150.281 ° zor 2.172) ates) $5.12 Plo Ato (Non-SRP) 4.291.763 «102«««1% «49% R852 ° 0 0087 a7 380 soo7 Palo Alto (SRP) tasers 21 42% «32% 92.210 ° 0 (gos) a8 S40 Recoos Shores 3101962 42 166% 754% 504.563. ° s2sa Total 34883,45 562 155% 12.2% 3.769843 o 23011 t7a06 243,708 S262 * RENTAL RATES REFLECT SPSFIMONTH MARKET HIGHLIGHTS, SIGNIFICANT 2010 NEW LEASE TRANSACTIONS BULDING ‘SUSAR Teun 'SOUARE FEET BLDGCLASS £850 Cherry Avenue San Bruno Walmart.com 268,000 A 395 Page Mill Road Palo Aito AOL (America on Line) 228,850 A 1 Lagoon Drive Redwood City Ecuinix. nc 70976 A 3055 Clearview Way ‘San Mateo Solar City 68,025 8 1950 Towor Lane. Foster City Quinn Street 63,998 A ISIGNIFICANT 2010 SALE TRANSACTIONS: puto ‘SUBMARKET ‘one SQUARE FEET PURCHASE PRICE ‘8000 Marina Bovlevaré Brisbane Diamond Associates 192,000 $30,000,000 180 Oyster Point Boulevard South San Francisco BioMed Realty Trust, nc. 108,000 Part of a Postolo Sale 41730 South El Camino Real San Mateo AKL Corporation 43,378 $5,300,000 SSN Lee CSN SONS SUES NEA CUSHMANE. cosrnans ais catnn nL nee gece re ait pi rn gr WAKEFIELD, | 20S istic Keo one maaeenwema ane