Q3 2016 DENVER INDUSTRIAL MARKET REPORT

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DENVER INDUSTRIAL MARKET REPORTQ

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INDUSTRIAL SALES ACTIVITY

DENVER

The number of industrial sales rose in the second quarter 2016 in comparison to the first quarter 2016.* During the second quarter, the Denver market experienced 37 buildings that sold total-ing 2,757,000 square feet and averaged $96.19 per square foot. This compares to 45 sale trans-actions totaling $181,675,761 in the first quarter with a total square footage of 2,214,877 for an average price per square foot of $82.03.

The total industrial building sale activity in-creased in 2016 compared to the activity report-ed in 2015. During the first 6 months of 2016, the industrial market had 82 sale transactions with a total sales volume of $446,879,132. The price per square foot averaged $89.88 compared to $74.31 the previous year.

Overall cap rates decreased in 2016, an average of 7.16%, compared to the same period in 2015 when they averaged 7.48%. One of the largest Q3 industrial sales in Denver for Unique Properties is the sale of 5200 East 78th Avenue inDenver, CO for $1,700,000.

*sales of 15,000 s.f. or larger

THIRD QUARTER 2016 Industrial overview

The overall Denver industrial vacancy rate ended the third quarter at 4.5%, remaining exactly the same as the previous quarter. More

specifically, both industrial-flex projects and warehouse projects expe-rienced a slight increase in vacancy over the last quarter. Vacant sub-lease space increased dramatically, to 987,082 square feet from 618,165 square feet the previous quarter. Currently there are 4,559,050 square feet of industrial buildings under construction, having had a total of 8 buildings delivered to the market totaling 616,142 square feet during Q3 2016.

The overall Denver industrial market had positive absorption of 269,773 square feet during Q3 2016. This compares to last quarter’s positive absorption of 1,343,420 square feet.

Third quarter rental rates were reported at $8.25. This remained the same in rental rates from the year-end numbers reported in Q2 2016.

DENVER | VACANCYPERIOD INDUSTRIAL

VACANCY %FLEX

VACANCY %WAREHOUSEVACANCY % NET ABSORPTION

Q4 2015 4.4% 9.6% 3.2% (369,665) SF

Q1 2016 4.3% 9.5% 3.3% 612,133 SF

Q2 2016 4.5% 9.1% 3.5% 1,343,420 SF

Q3 2016 4.5% 9.2% 3.6% 269,773 SF

Source: CoStar

9.0%8.0%7.0%6.0%

5.0%4.0%3.0%2.0%1.0%0.0%

Q3 2015 Q1 2016 Q3 2016

KEY

U.S.

DENVER

Q1 2015

U.S. INDUSTRIALVACANCY

COMPARISON

Q3 2016 DENVER INDUSTRIAL MARKET REPORT

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TOTAL INDUSTRIAL MARKET STATISTICS Q3 2016

Source: CoStar

FEATURED Q3 INDUSTRIAL SALE TRANSACTION Unique Properties Transactions

6451 E. 49th Dr.

COMMERCE CITY

PRICE: $2,600,000SIZE: 64,025 SF

5200 E. 78th Ave.

DENVER

PRICE: $1,700,000SIZE: 12,000 SF

2042 S.Bannock St.

DENVER

PRICE: $525,000SIZE: 1,525 SF