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1. MARKET INDICATORS POINT TO CONTINUED RECOVERY.

2. OPPORTUNITIES ARE BEING CREATED FOR ALL OF US.

3. FORECAST FOR STEADY, MODERATE GROWTH OVER NEAR TERM.

TODAY’S THEMES

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MARKET BAROMETERS

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DRIVERS FOR PROPERTY DEMAND TRENDING IN THE RIGHT DIRECTION: • PROPERTY INVESTMENT CONTINUES ITS SLOW CLIMB.• HOUSING MARKETS RECOVERING NICELY. • JOB GROWTH BACK TO PRIOR PEAK LEVELS.• INTEREST RATES STILL EXTREMELY LOW.• RECORD-HIGH NEW CONSTRUCTION/DEVELOPMENT.• SECONDARY METROS RALLYING BACK.

PATIENT’S VITAL STATS

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SMALL CAP SALES:• Up 30% in 1Q15

LARGE CAP SALES: • Up 45% in 1Q15

THE HIGHLIGHT OF THIS RECOVERY: PROPERTY TRANSACTIONS GROWTH

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• MAJOR BUYING CLASSES• Real estate investment trusts (REITs)• Foreign investors** • Private equity funds• Hedge funds• Traditional developer/owner/operators

DEAL MAKING: WHO’S INVESTING?

2014 TOP BUYERSARCP

Blackstone

JP Morgan

Norges Bank Investment Mgt

Hines

OMERS

Starwood Capital Group

MetLife

Essex Property Trust

David Werner Real Estate

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EXPANDING UNIVERSE OF U.S. BUYERS

THREE TIMES AS MANY BUYERS TODAY THAN IN DEPTHS OF DOWNTURN

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• SMALLER SECONDARY METROS WITH STRONG GROWTH PROFILES ARE SEEING INVESTOR INTEREST:• Portland, Seattle, Denver, Austin, Nashville, Atlanta, Las Vegas, etc.

• COMMON DENOMINATORS:• Strong job growth• Growing technology sectors, healthcare and financial services

industries

EXPANDING UNIVERSE OF METROS: SMALLER MARKETS HEATING UP

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THE STORY IN LENDING

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• FINANCING MARKET IS INCREASINGLY COMPETITIVE.

• BANKS HAVE $ TO LEND, UNDERWRITING STILL VERY CAUTIOUS.

• UPTICKS IN LENDING VOLUMES SUPPORT POSITIVE INVESTMENT TRENDS.

• REGIONAL/MID-SIZED BANKS ARE GAINING MARKET SHARE...

LENDING TRENDS IN 2015

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• A POSITIVE TRAJECTORY IN LENDING• 2014 VOLUMES:

• 6.5% ANNUAL GROWTH (FDIC)• STILL 25% BELOW 2007 PEAK, EXCEPT MULTI-

FAMILY LENDING• WIDE VARIABILITY IN GROWTH BY BANK SIZE…

PROPERTY LENDING:SLOW PACE OF GROWTH IN ORIGINATIONS

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• U.S. AVERAGE GROWTH IN LOAN PORTFOLIOS: 6.5% • STRONGEST GROWTH:

• Largest regional banks • Mid-sized banks

• PARTICULARLY STRONG GROWTH IN:• Construction/development loans fastest-growing category• Multifamily loans still strong

VARIANCE IN GROWTH BY BANK SIZE

Growth in CRE Loan Portfolios (2014 vs. 2013)

All banks 6.5%Assets >$50B 4.1%$10B-$50B 16.8%$1B-$10B 10.5%<$1B -1%

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• HEADING INTO NEW ROUND OF REFINANCING, PEAKING IN 2017 • LENDERS VIEW AS OPPORTUNITY TO INCREASE VOLUMES.• EXCESS CAPITAL LOOKING TO FINANCE SOLID REAL ESTATE.• SURGE IN REFINANCING ACTIVITY FROM NOW THROUGH 2017.

LENDING OPPORTUNITY:NEW ROUND OF REFI’S

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• CONSTRUCTION SPENDING• 2014: HIGHEST LEVEL SINCE

DOWNTURN• APRIL: FASTEST MONTHLY

PACE IN MORE THAN 6 YEARS • POINTS TO MARKED INCREASE

IN U.S. DEVELOPMENT IN 2015• EXPANDING TO SMALLER

METROS…

2015: THE YEAR FOR NEW DEVELOPMENT

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METRO MAGNETS: 1. Denver2. Raleigh-Durham3. Suburban VA4. Oakland5. Las Vegas6. Austin7. San Jose8. Miami9. Seattle10.Portland

THE CONSTRUCTION/DEVELOPMENT OPPORTUNITY

MOST ACTIVE GROUPS ACQUIRING SITES FOR DEVELOPMENTHFZ Capital Group

Greenland Group

Tishman Speyer

Carmel Partners

Oceanwide Real Estate Group

Crown Resorts

Oaktree

Mitsui Fudosan

Fortis Property Group

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METRO MAGNETS: 1. Denver2. Raleigh-Durham3. Suburban VA4. Oakland5. Las Vegas6. Austin7. San Jose8. Miami9. Seattle10.Portland

THE CONSTRUCTION/DEVELOPMENT OPPORTUNITY

MOST ACTIVE GROUPS ACQUIRING SITES FOR DEVELOPMENTHFZ Capital Group

Greenland Group

Tishman Speyer

Carmel Partners

Oceanwide Real Estate Group

Crown Resorts

Oaktree

Mitsui Fudosan

Fortis Property Group

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SCOREKEEPER BENCHMARKS: DENVER

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Region 1Q Growth YonYNortheast 2%West 14%MidAtlantic -4%South 1%Midwest 1%California 6%North Atlantic 8%South Atlantic -1%U.S. AVERAGE 4%

SCOREKEEPER: REGIONAL GROWTH 1Q2015

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SCOREKEEPER: GROUND-TRUTHING THE MIGRATION TO SECONDARY METROS

TOP 10 HIGH-GROWTH METROS FOR PHASE I ESA GROWTH:

1Q2015 (YonY)

Las Vegas, NV 52%

Columbia, SC 42%

San Antonio, TX 38%

Charleston, SC 26%

Milwaukee, WI 22%

San Francisco, CA 20%

Sacramento, CA 19%

Stamford, CT 16%

Portland, OR 14%

Raleigh, NC 13%

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SCOREKEEPER: COLORADO TREND LINE

Up 6% YonY

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SCOREKEEPER: METRO FOCUS

COLORADO IN THE CONTEXT OF U.S. TOP 50 METROS:

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DENVER’S CURRENT INVESTMENT CLIMATE

5th hottest retail market in the U.S.6th for office7th for hotel

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NEAR-TERM FORECAST

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• STILL A LOT OF ROAD TO RUN IN THIS RECOVERY.• TRANSACTION VOLUME REMAINS ON THE MEND.• MODERATE GROWTH IN NEW ORIGINATIONS. • CONTINUED MIGRATION TO SECONDARY AND TERTIARY METROS.• FAVORABLE LOW INTEREST RATE ENVIRONMENT. • PHASE I ESA FORECAST: 4 TO 8% RANGE NEXT 2 YEARS.

“2015 WILL BE ONE OF THE STRONGEST YEARS WE’VE SEEN IN COMMERCIAL REAL ESTATE SINCE THE CREDIT CRISIS AND IT’S FOR

ALL THE RIGHT REASONS.” ~KEN RIGGS, RERC

“OPTIMISM IS THE HIGHEST IT’S BEEN SINCE THE DOWNTURN.” ~RYAN SEVERINO, REIS

THE NEAR-TERM MARKET FORECAST

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• RISK MANAGEMENT IS NOW EVERYONE’S BUSINESS.

• PAST “DEAL KILLERS” ARE NOW BEING MANAGED.

• FAILED PROPERTIES/PROJECTS ARE MOVING BACK INTO PLAY.

• EFFICIENCY IN DUE DILIGENCE IS PARAMOUNT.

THE FORECAST FOR RISK MANAGEMENT

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