Benchmark Properties

Investment Trends Survey

Contributors to our quarterly survey are asked to provide an opinion on a wide range of questions related to investment performance trends and valuation parameters. To ensure consistent and valuable results, we have developed a list of definitions for each of the asset types included in the survey. Additionally, for each of the markets covered in the survey we have chosen a property which fits the appropriate definition. These benchmark definitions and the representative properties are evaluated on a regular basis, and where appropriate, changes are made.

Downtown Class “AA” Office	400,000 to 900,000 square feet Class “AA” physical features Strong location in local market 5% existing vacancy 10% roll-over per year Leased at market rates to good covenant tenants
Downtown Class “AA” Leasehold	Un-expired ground lease term of 80 years No participation ground rent No option to acquire the leased fee interest Current rent is fixed for the next five years The subsequent renewals are for ten year terms The renewal rent is based on the market value of the land unimproved, multiplied by the market rate of return
Downtown Class “B” Office	100,000 to 200,000 square feet Class “B” physical features Limited on-site parking Good location Multi-tenant 5% vacant 10% roll-over per year Leased at market rates. No triple “A” tenants
Downtown Office Land Parcel	100% location in local market One acre (209’ x 209’) Has two major and one minor street frontage Has zoning in place for 525,000 square feet of commercial density or 12.0 times coverage
Suburban Class “A” Office	100,000 - 170,000 square feet Class “A” physical features -5 to 10 years old 3.0 stalls per 1,000 square feet surface parking Prominent position within established and well recognized suburban business park Multi tenant 5% vacancy 10% roll-over per year Leased at market rates to good covenant tenants
Suburban ‘B’ Office	100,000 - 170,000 s.f. Class "B" physical features 3.0 stalls per 1,000 s.f. surface parking Prominent position within established and well recognized suburban business park 5% vacancy 10% roll-over per year Leased at market rates to good covenant tenants
Suburban Land Parcel	Prominent position within an established and well recognized suburban business park Primary access to the Park is vehicular as opposed to subway or LRT 5 acres (square) Two street frontages as well as Highway frontage Zoned for one times coverage (i.e. 220,000 square feet) of commercial office
Montreal Midtown Class ‘A’ Office	80,000 to 120,000 square feet 10 to 15 years old Class “A” physical features Combination of indoor/outdoor parking; 1 to 2 stalls per 1,000 square feet Location on a main road Montreal Urban Community location, outside downtown but within 10 km from Place Ville-Marie Multi-tenant 5% vacancy 10% annual rollover Leased at market rates to good covenant tenants
Tier I Regional Mall	Greater than 700,000 square feet Dominant market presence Renovated in the past 5 years 2/3 anchor tenants occupy 50% of rentable area Expansion potential not to be considered CRU sales have been growing and currently average >$450 per square feet sourced from 85% national tenants
Tier II Regional Mall	400,000 s.f. - 600,000 s.f. Dominant only in a local sense Renovated in the past 10 years 2 anchor tenants occupy at least 40% of rentable area CRU sales are relatively flat and are < $400 per s.f. Expansion potential not to be considered
Power Centre	Dominant for the region Greater than 500,000 square feet 5 to 10 years old Major arterial position Proximity to controlled highway access Strong covenant, national tenants 10-15 year leases
Food Anchored Retail Strip	10 to 15 years old 75,000 to 125,000 square feet Intersection of two arterials Secure local position Mature residential district Major chain supermarket of 45,000 square. ft. trading at $475 per square feet with 10 year lease CRU mix contains blend of national / regional chains and local / independents
Enclosed Community Mall	20 years old 150,000 to 250,000 square feet enclosed Intersection of two major arterials Mix of national chains and local independents Anchored by one major chain supermarket and at least one department / discount store Typically of older construction, lying in mature area
Single Tenant Retail building	Greater than 80,000 square feet Of recent vintage (+/-5 years old) Suburban location, prominent arterial position 25% site coverage with good parking (minimum 5.0 per 1,000 s.f.) 15-year lease Years one to five at market with 13% contractual rental growth in years six and eleven Investment grade covenant strength (e.g. Home Depot, RONA and Canadian Tire) For the purpose of this survey, assume the locations mentioned in the following chart have the above mentioned leasing characteristics
Suburban Multiple Unit Residential building	150 - 300 Suites - highrise 25 years old Well maintained with no deferred maintenance Good suburban location Good proximity to retail and transportation facilities Stabilized rents with stabilized operating expenses Average of 15-25% annual tenant turnover 25% cash to first mortgage at current rates
Multiple Unit Residential Land Parcel	Downtown Core / Waterfront location Good proximity subway / public transit 100-150 units at an average gross area of 1,000 square feet per unit Zoning in place
Multiple Unit Residential Leasehold	Benchmark multi-residential building Un-expired ground lease term of 80 years Current rent is fixed for the next 15 years The subsequent renewals are for ten year terms No additional participation ground rent Institutional ownership of the fee No option to acquire the leased fee interest The renewal rent is based on the market value of the land unimproved, and unencumbered, multiplied by the market rate of return
Downtown Multiple Unit Residential building	150 -300 Suites, high-rise 25 years old Well maintained with no deferred maintenance Good downtown location Good proximity to retail and transportation facilities Market rents with stabilized operating expenses Average of 15%-25% annual tenant turnover 25% cash to first mortgage at current rates For the purpose of this survey, assume the buildings / locations mentioned in the following chart have the above mentioned leasing characteristics
Montreal Midtown Multiple Unit Residential building	200 -300 suites, high-rise 25 years old Well maintained with no deferred maintenance Good midtown location Montreal Urban Community location, outside downtown but within 10 km from Place Ville-Marie Good proximity to retail and transportation Stabilized rents and stabilized operating expenses Few, if any rental board cases Average 15% to 25% annual rollover 25% cash to first mortgage at current rates
Single-tenant Industrial building	100,000 s.f. single tenant warehouse property Pre-cast construction with 10% office finish and 28 ft. clear height Of recent vintage (+/-5 years old) Suburban location, with good highway access 45% site coverage with good turning radius and good parking 10 to 15 shipping doors 10 year lease Years one to five at market with 15% contractual rental growth in year six Investment grade covenant strength (i.e. Standard & Poor BBB or better) For the purpose of this survey, assume the buildings / locations mentioned in the following chart have the above mentioned leasing characteristics
Multi-tenant Industrial building	60 - 100,000 square feet with 15% to 25% office finish and 18 ft. clear height Of recent vintage (+/-10 years old). Unit size range from 3,000 to 8,000 with 15 to 25 tenants Suburban location 40% site coverage with good turning radius, one shipping door per demised unit and good parking Year one contract rates at market with annual rental growth. Mostly local covenants but may have some recognizable nationals Full occupancy and no month to month tenancies Lease rollover of about 20-30% per annum for the next three years
Industrial Land Parcel	Prominent position within an established and well recognized business park Excellent highway access, but no exposure 5 to 10 acres Zoned industrial, but no outside storage permitted Two street frontages Good frontage to depth ration Services available at site boundary No rail access
Hotel Property	300 Rooms Prominent Downtown location 15 years old 4 star quality Renovation program evident Well maintained with no deferred maintenance Flag such as Marriott or Sheraton Full services and amenities such as Bar / Restaurant; recreation facilities -indoor pool etc, Parking availability