Q1-2018-OfficeReport

CAPITAL MARKETS STATISTICS Property Property City/Submarket Westwood

Property Property City/Submarket City/Submarket Buyer

40 Court Street 40 Court Street Boston Exan Capital LLC $54,000,000 Boston Exan Capital LLC $54,000,000 109,705

101 Station Driv 101 Station Drive AEW Capital Mana AEW Capital Ma $53,100,000 $53,100,000 208,134

Buyer Price Total SF Price/SF Cap Rate Total SF Price/SF Cap Rate Buyer Price

City/Submarket Westwood

Buyer Price Price Total SF Price/SF Cap Rate Total SF Price/SF Cap Rate

MEDIAN $/SF $177 109,705 $492 4.0% $492 4.0%

208,134 $255 6.50% $255 6.50%

SALES VOLUME ($)

NUMBER OF TRANSACTIONS

TOTAL SF

MEDIAN CAP RATE

$704,191,923

55

4,135,512

6%

Sale Volume

Sale Volume SALES VOLUME $4,000

TRENDS • Following a rather lackluster second-half of 2017, transaction volume failed to make headway in Boston’s office market during the first quarter. With that said, Boston remains a highly-desirable destination for capital among all investor types and the limited inventory of available properties for sale continues to drive up pricing. Similar to national office trends, suburban investment is on an upswing, with the median price-per-square-foot increasing by more than 30% over the past year. This compares to just 1.6% growth in the urban markets. • Investors seeking higher yields and greater opportunities are driving the expanded suburban investment activity in recent quarters. Three out of the top four largest office transactions took place in the ‘burbs, with CrossHarbor Capital Partners; $277 million purchase of Cross Point in Lowell representing the top deal. Spear Street Capital’s $88 million acquisition of the former Reebok campus in Canton was another major sale that closed during the first quarter. National development sold 101 Station Drive in Westwood to AEW Capital for $53.1 million or $255 per square foot and Minardi Limited Partnership picked up two assets on Donald Lynch Boulevard in Marlborough for $13 million or $104 per square foot. • When Downtown assets do change hands, buyers pay a premium. Exan Capital recently purchased 40 Court Street, a 109,705-square-foot Class B asset in the Financial District for $54 million or $492 per square foot at a 4% cap rate. Stars Investment paid just $31 million for the building in 2014. The sale of 28 State Street is reportedly nearing completion, with an estimated price tag of $430 million or $745 per square foot. This would represent a 25% price increase from the asset’s 2014 sale.

$3,500

$4,000

$3,000

$3,500

$2,500

$3,000

$2,000

$2,500

$1,500

$ (000s)

$2,000

$1,000

$1,500

$ (000s)

$500

$1,000

$0

$500

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

$0

Suburban Urban

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Suburban Urban

MEDIAN PRICE/SF Median Price/SF

Median Price/SF $700

$600

$700

$500

$600

$400

$500

$300

$400

$200

$300

$100

$200

$0

$100

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

$0

Suburban

Urban

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

TOP Q1 / INVESTMENT SALES

Suburban

Urban

INDUSTRIAL SALES

Q1 2017

Q2 2017

Q3 2017

Q4 2017

TOTAL

SALES VOLUME ($) Former Reebok HQ Canton Cross Point Lowell

$374,173,554 101 Station Drive Westwood

$453,379,723 Former Reebok HQ Canton

40 Court Street Boston

$385,172,081

$433,947,886

$1,646,673,244

# OF TRANSACTIONS

76

78

82

60

296

Spear Street Capital CrossHarbor Capital Partners $227,2 , $88,000,000

TOTAL SF

4,779,432

6,394,205

4,045,511

4,243,774

19,462,922

Buyer

Buyer

Exan Capital LLC

Buyer

AEW Capital Management

Buyer

Spear Street Capital

MEDIAN $/SF

$75

$59

$103

$86

$90

Price

Price

$54,000,000

Price

$53,100,000

Price

$88,000,000

Total SF

680,000 1,282,212

Total SF

109,705

Total SF

208,134

Total SF

680,000

Price/SF

$129 77

Price/SF

$492

Price/SF

$255

Price/SF

$129

Cap Rate

-

Cap Rate

4.0%

Cap Rate

6.50%

Cap Rate

-

7