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1. MARKET INDICATORS POINT TO CONTINUED RECOVERY.

2. OPPORTUNITIES ARE BEING CREATED FOR ALL OF US.

3. FORECAST FOR MODERATE GROWTH OVER NEAR TERM.

TODAY’S THEMES

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MARKET BAROMETERS

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ALL THE KEY DRIVERS FOR PROPERTY DEMAND ARE TRENDING IN THE RIGHT DIRECTION: • PROPERTY INVESTMENT CONTINUES ITS SLOW CLIMB. • HOUSING MARKETS RECOVERING NICELY. • JOBS ARE BACK PAST PRIOR PEAK LEVELS. • INTEREST RATES STILL EXTREMELY LOW. • MORE NEW CONSTRUCTION/DEVELOPMENT. • NEW ACTIVITY IN A NUMBER OF SECONDARY MARKETS.

THOUGHTS ON REAL ESTATE IN 2015

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Small cap property sales: +22% in 2014: 7-year high Large property sales: +45% in 1Q2015 (YonY)

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 BUYERS ARCP

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

• NUMBER OF ACTIVE BUYERS IS 24% HIGHER THAN PRE-CRISIS. • 3-FOLD INCREASE SINCE 2009 • 2014: 18,574 UNIQUE BUYERS IN COMMERCIAL REAL ESTATE

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• SMALLER SECONDARY MARKETS 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

BEYOND NYC AND SAN FRAN: NEW MARKETS ARE GETTING HOT

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• FINANCING MARKET IS INCREASINGLY COMPETITIVE.

• BANKS HAVE $ TO LEND, STILL VERY CAUTIOUS. • REGIONAL/MID-SIZED BANKS ARE GAINING MARKET SHARE. • UPTICKS IN LENDING VOLUMES SUPPORT POSITIVE

INVESTMENT TRENDS…

LENDING TRENDS IN 2015

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• A POSITIVE TRAJECTORY IN LENDING • 2014:

• 6.5% ANNUAL GROWTH (FDIC) • STILL 25% BELOW 2007 PEAK • WIDE VARIABILITY IN GROWTH BY BANK SIZE…

LENDING: SLOW PACE OF GROWTH IN ORIGINATIONS

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• AVERAGE GROWTH IN LOAN PORTFOLIOS: 6.5% • STRONGEST GROWTH AT THE LARGEST REGIONAL BANKS AND

MID-SIZED BANKS. • SIGNIFICANT PULLBACK BY COMMUNITY BANKS. • GROWTH ESPECIALLY STRONG IN

CONSTRUCTION/DEVELOPMENT AND MULTIFAMILY CATEGORIES.

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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SNAPSHOT: NEW JERSEY BANKS

• COMMERCIAL REAL ESTATE LOAN GROWTH AT NEW JERSEY-BASED BANKS HAS INCREASED IN EACH OF PAST 5 YEARS.

• 2014 GROWTH: UP +13% YEAR ON YEAR • 1Q15:

• Mariner’s: + 3.8% • Freedom Bank: + 9.0% • Columbia Bank: +10.5%

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• SBA FY 1Q15 LOAN APPROVALS SPIKED • LOAN APPROVALS UNDER 7(A) WERE UP A SIGNIFICANT 32% IN

THE 4TH QUARTER OF 2014 VERSUS PRIOR YEAR. • NEARLY 14,000 LOANS WERE APPROVED UNDER THE 7(A)

PROGRAM IN THE OCT.-DEC. TIMEFRAME. • EXPECTED TO CONTINUE: 10-15% GROWTH IN 2015

U.S. SBA LENDING

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• HEADING INTO NEW ROUND OF REFINANCING, PEAKING IN 2017 • LENDERS VIEW THIS WAVE OF MATURITIES AS OPPORTUNITY TO

INCREASE VOLUMES. • EXCESS CAPITAL LOOKING TO FINANCE SOLID REAL ESTATE

DEALS. • EXPECTED TO FUEL A SURGE IN REFINANCING ACTIVITY FROM

NOW THROUGH 2017.

NEW ROUND OF REFI’S

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• VYING FOR A PIECE OF THE REFI MARKET: • Traditional lenders • Life companies • Conduits • Private equity (non-bank lenders, new this refi cycle)

NEW REFI PLAYERS

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• VYING FOR A PIECE OF THE REFI MARKET: • Traditional lenders • Life companies • Conduits • Private equity (non-bank lenders, new this refi cycle)

NEW REFI PLAYERS

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• CONSTRUCTION AND DEVELOPMENT LENDING WAS THE FASTEST GROWING CATEGORY OF CRE LOANS ACROSS BANKS OF ALL ASSET SIZES.

• BEYOND PRIMARY METROS • POINTS TO MARKED INCREASE IN

U.S. DEVELOPMENT IN 2015

2015: THE YEAR FOR NEW DEVELOPMENT MOST ACTIVE GROUPS ACQUIRING SITES FOR DEVELOPMENT HFZ Capital Group

Greenland Group

Tishman Speyer

Carmel Partners

Oceanwide Real Estate Group

Crown Resorts

Oaktree

Mitsui Fudosan

Fortis Property Group

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• MULTIFAMILY STILL POPULAR BUT PEAKING • OFFICE IS IMPROVING ESPECIALLY IN STRONG 2NDARY METROS • RETAIL

• 40,923 new stores this year • INDUSTRIAL/WAREHOUSE DEMAND GROWING, PARTICULARLY

IN GATEWAY MARKETS.

TOP PROPERTY TYPES

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SCOREKEEPER BENCHMARKS

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Region 1Q Growth YonY Northeast 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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1Q2015 (YonY Growth)

Nevada 47%

Oregon 25%

Washington 15%

New Jersey 13%

Utah 11%

South Carolina 10%

Missouri 8%

Wisconsin 8%

New York 7%

Texas 6%

SCOREKEEPER: STATE HOT SPOTS, 1Q2015

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NEW JERSEY: PHASE I ESA TREND LINE

Up 13% YoY

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SCOREKEEPER’S METRO FOCUS

NJ-AREA METROS RANKED AMONG TOP 50 IN THE U.S.:

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TOP PHASE I ESA MARKETS: NORTHERN NJ METRO 7TH IN THE NATION

2014 YTD

NYC 11,552

LA 8,124

Chicago 6,428

Boston 5,103

Atlanta 4,666

Dallas 4,556

No. NJ 4,077

Philadelphia 3,922

Houston 3,919

DC 3,370

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OUTLOOK: NE/ATLANTIC REGION

Philly and No. NJ forecast: “average” to “improving”

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• NORTH AND CENTRAL JERSEY MARKETS RANK AMONG THE TOP 10 NATIONALLY IN DEMAND FOR OFFICE SPACE

• 2ND STRONGEST MARKET IN U.S. FOR MULTIFAMILY INVESTMENT

• 5TH MARKET IN U.S. FOR INDUSTRIAL PROPERTY INVESTMENT

• 11TH FOR RETAIL

SIGNS POINT TO GROWING MOMENTUM IN NORTHERN NJ

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THE 2015 FORECAST

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• THERE'S STILL A LOT OF ROAD TO RUN IN THIS RECOVERY. • TRANSACTION VOLUME REMAINING ON THE MEND. • MODERATE GROWTH IN NEW ORIGINATIONS. • CONTINUED MIGRATION TO SECONDARY AND TERTIARY METROS. • FAVORABLE LOW INTEREST RATE ENVIRONMENT (HIGH

PROBABILITY OF INCREASE IN EARLY 2016). • PHASE I ESA FORECAST: 4-8% 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 HIGHEST IT’S BEEN SINCE THE DOWNTURN.” RYAN

SEVERINO, REIS

2015 FORECAST

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