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CBRE State of the Market:
Second Quarter Washington, DC Regional
Office Market Statistics
June 30, 2011
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Agenda
Introduction
Overview of Washin ton DC Re ion
In-depth Analysis of Quarter
Northern Vir inia Washington, DC
Suburban Maryland
National Overview and Outlook Questions
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Introduction
Speakers
Liz Wainger, Moderator
John Germano, Executive Managing Director ar anne wear ngen, esearc anager
Jon Southard, Principal and Director of Forecasting,
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Washington Metropolitan
Second Quarter 2011
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Historical DeliveriesNorthern Virginia
2009200820072006
2010
6.1M SF . 5.5M SF . 313K SF
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DevelopmentNorthern Virginia
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Historical Vacancy RatesNorthern Virginia
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Northern Virginia Historical Trends
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, ,
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,Second Quarter 2011
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DevelopmentWashington, DC
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Historical Vacancy RatesWashington, DC
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Suburban Maryland Historical Deliveries
200920082007
2010
. . .
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DevelopmentSuburban Maryland
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Suburban Maryland Historical Vacancy Rates
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Hi i l T d
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Suburban Maryland Historical Trends
10-Year Average Net Absorption: 256,364 SF
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The Economy And the National
DC Advantage Starts with Employment
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DC Advantage Starts with Employment
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Office Market Healing Nationally
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Office Market Healing Nationally
24150Completions, Net Absorption, msf Vacancy, %
Forecast
20100
120
8-50
0
4
-150
-100
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Completions (L) Net Absorption (L) Vacancy (R)
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Source: CBRE EA Office Outlook, Summer 2011.
Pricing Power Will Begin to Shift But Slowly
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Pricing Power Will Begin to Shift, But Slowly
2115Rent Inflation, % Vacancy, %
Forecast
1810
12
15
0
5
9-5
6-10
3-15
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Rent Inflation Vacancy (R)
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Source: CBRE EA Office Outlook, Summer 2011.
Industrial Availability Keeps Dropping
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Industrial Availability Keeps Dropping
18150
Net Absorption, Completions (msf) Availability Rate (%)
Forecast
12
15100
9
0
3-50
0-100
200
0.
1
200
1.
2
200
2.
3
200
3.
4
200
5.
1
200
6.
2
200
7.
3
200
8.
4
201
0.
1
201
1.
2
201
2.
3
201
3.
4
Completions (L) Net Absorption (L) Availability Rate (R)
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Source: CBRE EA Industrial Outlook, Summer 2011.
Lower Availability Will Start to Drive Rent Growth
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Lower Availability Will Start to Drive Rent Growth
1812
Annual % in TW Warehouse
Rent Index Availability Rate (%)
158
orecast
90
3
6
-8
-4
0-12
990
991
992
993
994
995
996
997
998
999
000
001
002
003
004
005
006
007
008
009
010
011
012
013
014
015
016
1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
Rent Growth (L) Availability Rate (R ) LT Availability Average
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Source: CBRE EA Industrial Outlook, Summer 2011.
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Questions?
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