Toronto Commercial Real Estate - Brokers reports by Chris Fyvie

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 Greater Toronto Area Office Concentration

Class

Surveyed

Rate

Q4 2009

12 Months

Avg. Asking Net Rental Rates 5

CENTRAL AREA TOTAL:

AAA A B C All

11 139 322 259 731

12,718,015 28,689,977 33,721,305 12,813,900 87,943,197

1,079,342 1,701,405 1,196,178 549,793 4,526,718

8.5% 5.9% 3.5% 4.3% 5.1%

2,283,240 2,975,226 2,714,119 889,935 8,862,520

7.7% 27.2% 22.1% 13.9% 19.3%

18.0% 10.4% 8.0% 6.9% 10.1%

16.8% 10.2% 5.4% 6.3% 8.6%

(343,131) 1,106,036 (581,703) (58,412) 122,791

(337,499) 1,273,115 (583,624) (90,344) 261,647

$29.16 $22.31 $17.45 $15.09 $20.12

$60.25 $41.92 $34.68 $28.39 $39.33

2,053,363

2,310,000

Financial Core

AAA A B C All

11 26 37 35 109

12,718,015 11,598,752 5,645,411 3,653,565 33,615,743

1,079,342 727,911 345,145 152,509 2,304,907

8.5% 6.3% 6.1% 4.2% 6.9%

2,283,240 1,348,116 650,112 242,694 4,524,163

7.7% 17.1% 20.8% 20.3% 13.0%

18.0% 11.6% 11.5% 6.6% 13.5%

16.8% 12.7% 7.8% 5.5% 12.5%

(343,131) 1,006,337 (35,119) 2,485 630,572

(337,499) 1,106,175 (149,703) (63,167) 555,805

$29.16 $28.22 $19.95 $16.78 $25.28

$60.25 $51.80 $40.68 $35.30 $50.17

2,022,003

880,000

Downtown

AAA A B C All

11 119 241 194 565

12,718,015 23,680,061 24,149,088 10,050,063 70,597,227

1,079,342 1,375,897 905,239 351,686 3,712,164

8.5% 5.8% 3.7% 3.5% 5.3%

2,283,240 2,416,821 2,150,818 578,271 7,429,150

7.7% 27.4% 20.7% 11.4% 18.1%

18.0% 10.2% 8.9% 5.8% 10.5%

16.8% 10.4% 5.0% 5.4% 8.8%

(343,131) 1,062,212 (233,085) (29,711) 456,285

(337,499) 1,122,092 (275,599) (119,789) 389,205

$29.16 $24.42 $18.10 $15.98 $21.38

$60.25 $43.69 $34.98 $27.92 $40.72

2,053,363

1,430,000

A B C All

20 81 65 166

5,009,916 9,572,217 2,763,837 17,345,970

325,508 290,939 198,107 814,554

6.5% 3.0% 7.2% 4.7%

558,405 563,301 311,663 1,433,370

26.5% 27.2% 18.7% 25.1%

11.1% 5.9% 11.3% 8.3%

9.3% 6.4% 9.4% 7.7%

43,825 (348,619) (28,701) (333,495)

151,022 (308,025) 29,445 (127,558)

$18.37 $15.15 $13.28 $16.23

$38.63 $33.61 $29.34 $35.05

A B C All

391 567 386 1344

45,021,755 38,392,372 13,129,681 96,543,808

3,468,210 2,457,489 828,494 6,754,193

7.7% 6.4% 6.3% 7.0%

5,285,606 3,845,920 1,179,207 10,310,733

25.1% 17.2% 12.1% 20.7%

11.7% 10.0% 9.0% 10.7%

10.0% 7.7% 7.7% 8.7%

626 205,898 (94,460) 112,065

420,448 (834,840) (483,528) (897,920)

$15.53 $12.76 $12.14 $14.04

$28.37 $24.66 $20.67 $25.98

189,513

610,499

A B C

112 216 132

14,778,342 16,119,305 4,263,640

1,389,098 1,254,075 174,514

9.4% 7.8% 4.1%

1,890,240 1,979,939 300,358

16.8% 16.3% 26.4%

12.8% 12.3% 7.0%

12.0% 9.6% 8.9%

(134,755) 85,158 3,957

(154,916) (134,952) (87,392)

$14.15 $11.67 $9.21

$26.25 $24.20 $18.10

All

460

35,161,287

2,817,687

8.0%

4,170,536

17.3%

11.9%

10.5%

(45,641)

(377,260)

$12.60

$24.71

December-09 Buildings

Midtown

SUBURBS TOTAL:

GTA East

GTA North

GTA West

Office Inventory 1

Vacant Space

Vacancy Rate 2

Available Space

Q4 2009 Sublet Availability 3 Availability Rate 4

Q4 2008 Availability

Net Absorption

Avg. Asking Gross

Net New Supply

Currently Under

Rental Rates

Q4 2009

Construction

7,888,467

452,526

5.7%

959,872

33.9%

12.2%

8.9%

53,566

45,622

$19.20

$37.24

6,128,912

154,381

2.5%

262,373

21.1%

4.3%

4.5%

15,181

(48,573)

$14.34

$29.99

1,409,798

32,944

2.3%

52,144

0.0%

3.7%

2.4%

10,420

(21,897)

$13.95

$22.61

All

198

15,427,177

639,851

4.1%

1,274,389

29.9%

8.3%

6.5%

79,167

(24,848)

$17.73

$34.88

220

22,354,946

1,626,585

7.3%

2,435,495

28.0%

10.9%

8.9%

81,816

529,742

$15.47

$27.29

266

16,144,155

1,049,033

6.5%

1,603,608

17.8%

9.9%

7.0%

105,559

(651,316)

$14.03

$24.30

200

7,456,243

621,036

8.3%

826,704

7.7%

11.1%

8.1%

(108,836)

(374,238)

$12.89

$21.33

All

686

45,955,344

3,296,655

7.2%

4,865,807

21.2%

10.6%

8.1%

78,539

(495,812)

$14.51

$25.18

GREATER

AAA

12,718,015

1,079,342

8.5%

7.7%

18.0%

16.8%

(343,131)

(337,499)

$29.16

$60.25

TORONTO

530

73,711,732

5,169,615

7.0%

8,260,833

2,283,240

25.9%

11.2%

10.1%

1,106,662

1,693,563

$17.27

$31.84

AREA

889

72,113,677

3,653,667

5.1%

6,560,039

19.2%

9.1%

6.6%

(375,805)

(1,418,464)

$14.56

$28.49

TOTAL:

645

25,943,581

1,378,287

5.3%

2,069,141

12.9%

8.0%

7.0%

(152,871)

(573,872)

$13.23

$23.52

All

2,075

184,487,005

11,280,911

6.1%

19,173,253

20.0%

10.4%

8.7%

234,855

(636,273)

$16.20

$30.72

63,515

189,513

546,984

2,242,876

2,920,499

SURVEY RESULTS PRESENTED IN THIS REPORT HAVE BEEN CONDENSED FOR EASY REFERENCE. NOTES: 1

Office Inventory:

For the purpose of this report, buildings with less than 10,000 sf of office space and buildings owned and occupied by the government have not been included in the office inventory.

Vacancy Rate:

The Vacancy Rate is the amount of vacant space divided by the existing building inventory base. Vacant space is available and physically unoccupied, and it includes both head lease and sublease space.

Sublet Availability:

This ratio represents the share of available sublease space of the total available space.

Availability Rate:

The Availability Rate is the amount of available space divided by the building inventory base. Available space is space that is available for lease and may or may not be vacant.

Average Rental Rates:

Average rental rates are calculated off available spaces which also quote rental figures.

Information contained herein has been obtained from the owners or from other sources deemed reliable. We have no reason to doubt its accuracy but regret we cannot guarantee it. All properties subject to change or withdrawal without notice.

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 Downtown Q4 2009

Q4 2008

Buildings

Office

Vacant

Vacancy

Available

Sublet

Availability

Net Absorption

Class

Surveyed

Inventory

Space

Rate

Space

Availability

Rate

Q4 2009

12 Months

119

23,680,061

1,375,897

5.8%

2,416,821

27.4%

10.2%

10.4%

1,122,092

$24.42

$43.69

AAA

12,718,015

1,079,342

8.5%

2,283,240

7.7%

18.0%

16.8%

(343,131)

(337,499)

$29.16

$60.25 $34.98

December-09 Concentration

DOWNTOWN TOTAL:

Financial Core

Downtown East

Downtown North

Downtown South

Downtown West

Toronto West

1,062,212

Avg.

Net

Asking Net

Asking Gross

New Supply

Under

Q4 2009

Construction

2,053,363

1,430,000

2,022,003

880,000

31,360

550,000

Rental Rates Rental Rates

241

24,149,088

905,239

3.7%

2,150,818

20.7%

8.9%

5.0%

(233,085)

(275,599)

$18.10

194

10,050,063

351,686

3.5%

578,271

11.4%

5.8%

5.4%

(29,711)

(119,789)

$15.98

$27.92

All

565

70,597,227

3,712,164

5.3%

7,429,150

18.1%

10.5%

8.8%

456,285

389,205

$21.38

$40.72

AAA

12,718,015

1,079,342

8.5%

2,283,240

7.7%

18.0%

16.8%

(343,131)

(337,499)

$29.16

$60.25

11,598,752

727,911

6.3%

1,348,116

17.1%

11.6%

12.7%

1,006,337

1,106,175

$28.22

$51.80

5,645,411

345,145

6.1%

650,112

20.8%

11.5%

7.8%

(35,119)

(149,703)

$19.95

$40.68

3,653,565

152,509

4.2%

242,694

20.3%

6.6%

5.5%

2,485

(63,167)

$16.78

$35.30

All

109

33,615,743

2,304,907

6.9%

4,524,163

13.0%

13.5%

12.5%

630,572

555,805

$25.28

$50.17

1,227,383

82,909

6.8%

123,694

19.8%

10.1%

6.9%

9,391

32,279

$14.93

$31.01

2,024,145

90,055

4.4%

325,714

8.8%

16.1%

5.4%

(7,013)

(54,077)

$17.53

$31.28

807,115

61,396

7.6%

75,370

3.8%

9.3%

9.8%

(2,268)

16,799

$13.75

$4.27

All

108

4,058,643

234,359

5.8%

524,778

10.7%

12.9%

6.7%

110

(5,000)

$16.74

$27.10

5,659,400

152,613

2.7%

341,367

55.6%

6.0%

5.9%

1,021

25,988

$15.46

$36.60

6,520,918

157,147

2.4%

260,610

37.6%

4.0%

3.3%

(178,473)

(155,405)

$16.30

$34.94

2,579,978

27,513

1.1%

58,980

10.7%

2.3%

2.6%

9,697

24,661

$14.35

$31.32

All

14,760,296

337,274

2.3%

660,957

44.5%

4.5%

4.2%

(167,756)

(104,757)

$15.94

$34.59

949,922

52,658

5.5%

92,563

46.6%

9.7%

3.6%

(12,518)

(46,666)

$29.50

$51.33

1,197,050

40,119

3.4%

151,832

65.3%

12.7%

11.2%

2,040

11,316

$18.17

$34.30

283,859

All

2,430,831

0.0%

92,776

3.8%

4,154,594

359,806

8.7%

102

8,476,779

256,701

3.0%

#DIV/0!

0.0%

(14,000)

$0.00

58.2%

10.1%

7.0%

(24,478)

(49,349)

$21.71

$39.61

503,552

34.6%

12.1%

14.1%

61,207

7,543

$18.78

$30.08

743,743

11.5%

8.8%

3.5%

(14,520)

91,702

$18.00

$33.33

244,395

1,801,971

57,503

3.2%

145,463

5.0%

8.1%

6.1%

12,072

(37,788)

$16.29

$24.15

All

216

14,433,344

674,011

4.7%

1,392,758

19.2%

9.6%

6.8%

58,759

61,457

$18.08

$31.58

90,010

0.0%

7,529

0.0%

8.4%

0.0%

(3,227) 0

(3,227)

$11.75

Currently

$22.75

284,785

16,072

5.6%

18,807

0.0%

6.6%

4.6%

(19,432)

$8.64

$21.85

923,575

52,765

5.7%

55,764

0.0%

6.0%

9.7%

(37,696)

(46,293)

$15.53

$24.31

All

1,298,370

68,837

5.3%

82,100

0.0%

6.3%

7.9%

(40,923)

(68,951)

$12.26

$23.11

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 Midtown Q4 2009

December-09 Buildings Concentration

Class Surveyed

Q4 2008

Office

Vacant

Vacancy

Available

Sublet

Availability Availability Net Absorption

Inventory

Space

Rate

Space

Availability

Rate

Q4 2009

Net Absorption 12 Months

Avg.

Net

Asking Net

Asking Gross

New Supply

Under

Q4 2009

Construction

Rental Rates Rental Rates

MIDTOWN

5,009,916

325,508

6.5%

558,405

26.5%

11.1%

9.3%

43,825

151,022

$18.37

$38.63

TOTAL:

9,572,217

290,939

3.0%

563,301

27.2%

5.9%

6.4%

(348,619)

(308,025)

$15.15

$33.61

2,763,837

198,107

7.2%

311,663

18.7%

11.3%

9.4%

(28,701)

29,445

$13.28

$29.34

All

166

17,345,970

814,554

4.7%

1,433,370

25.1%

8.3%

7.7%

(333,495)

(127,558)

$16.23

$35.05

2,653,810

174,041

6.6%

268,200

35.2%

10.1%

8.3%

21,206

105,350

$20.01

$39.77

5,631,289

138,827

2.5%

230,673

26.3%

4.1%

5.2%

(314,645)

(356,968)

$16.02

$36.38

1,414,301

106,382

7.5%

170,705

9.7%

12.1%

10.9%

8,682

30,893

$12.88

$30.33

All

9,699,400

419,250

4.3%

669,578

25.6%

6.9%

(284,757)

(220,725)

$16.77

$35.96

1,554,762

97,684

6.3%

204,339

14.0%

13.1%

14.3%

33,659

70,412

$16.10

$36.18

2,378,068

126,247

5.3%

197,415

18.0%

8.3%

9.8%

(23,313)

30,924

$14.10

$31.85

841,529

50,605

6.0%

99,838

1.6%

11.9%

10.5%

(9,383)

28,619

$14.82

$25.48

All

4,774,359

274,537

5.8%

501,592

13.1%

10.5%

11.4%

962

129,955

$15.09

$33.24

Yonge-Bloor

Yonge-Eglinton

Yonge-St.Clair

801,344

53,783

6.7%

85,866

28.9%

10.7%

2.9%

(11,040)

(24,740)

$19.34

$41.28

1,562,860

25,864

1.7%

135,214

42.2%

8.7%

5.6%

(10,660)

18,018

$15.77

$33.41

508,007

41,120

8.1%

41,120

97.3%

8.1%

3.4%

(28,000)

(30,066)

$13.50

$28.65

All

2,872,211

120,767

4.2%

262,200

46.5%

9.1%

4.4%

(49,700)

(36,789)

$17.14

$36.42

Currently

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 GTA North Office

Vacant

Vacancy

Available

Sublet

Q4 2009 Availability

Q4 2008 Availability

Net Absorption

Avg. Asking Net

Avg. Asking Gross

Net New Supply

Currently Under

Inventory

Space

Rate

Space

Availability

Rate

Q4 2009

12 Months

Rental Rates

Q4 2009

Construction

63,515

December-09 Buildings Concentration

Class Surveyed

GTA NORTH

7,888,467

452,526

5.7%

959,872

33.9%

12.2%

8.9%

53,566

45,622

$19.20

$37.24

TOTAL:

6,128,912

154,381

2.5%

262,373

21.1%

4.3%

4.5%

15,181

(48,573)

$14.34

$29.99

1,409,798

32,944

2.3%

52,144

0.0%

3.7%

2.4%

10,420

(21,897)

$13.95

$22.61

All

198

15,427,177

639,851

4.1%

1,274,389

29.9%

8.3%

6.5%

79,167

(24,848)

$17.73

$34.88

Dufferin/Finch

42,500

0.0%

#DIV/0!

0.0%

32.9%

$0.00

930,644

7,640

0.8%

24,329

4.6%

2.6%

4.4%

(660)

(2,090)

$9.50

$25.12

243,016

2,400

1.0%

16,400

0.0%

6.7%

1.2%

(400)

$7.95

$18.09

All

1,216,160

10,040

0.8%

40,729

2.7%

3.3%

4.7%

(1,060)

(2,090)

$9.36

$24.49

North Yonge

6,052,727

314,296

5.2%

814,646

40.0%

13.5%

8.2%

47,511

(66,874)

$19.43

$39.56

Corridor

2,546,517

107,874

4.2%

160,034

30.7%

6.3%

6.9%

14,865

10,056

$15.71

$33.65

293,061

#DIV/0!

0.0%

0.6%

640

1,680

$0.00

All

8,892,305

422,170

4.7%

974,680

11.0%

7.6%

63,016

(55,138)

$18.55

$38.16

369,705

11,950

3.2%

15,071

0.0%

4.1%

1.2%

(11,950)

$17.00

$29.00

230,118

2,280

1.0%

2,280

0.0%

1.0%

4.1%

1,323

(2,280)

$14.00

$23.00

40,000

0.0%

#DIV/0!

0.0%

$0.00

All

639,823

14,230

2.2%

17,351

0.0%

2.7%

2.2%

1,323

(14,230)

$16.61

$28.21

930,204

106,321

11.4%

110,195

0.0%

11.8%

19.6%

6,055

110,646

$19.49

$30.77

1,312,610

20,499

1.6%

56,380

8.9%

4.3%

1.9%

5,440

(24,997)

$14.12

$24.45

479,996

16,544

3.4%

21,744

0.0%

4.5%

2.1%

2,080

(14,977)

$16.00

$24.00

All

2,722,810

143,364

5.3%

188,320

2.7%

6.9%

7.3%

13,575

70,671

$17.52

$28.21

493,331

19,960

4.0%

19,960

0.0%

4.0%

4.2%

13,800

$14.00

$24.95

1,109,023

16,088

1.5%

19,350

0.0%

1.7%

2.2%

(5,788)

(29,262)

$9.89

$24.62

353,725

14,000

4.0%

14,000

0.0%

4.0%

5.5%

8,100

(8,600)

$3.95

$16.35

All

1,956,079

50,048

2.6%

53,310

0.0%

2.7%

3.3%

2,313

(24,062)

$11.80

$24.35

Richmond Hill

Vaughan/Woodbridge

Keele Hwy 401/Yorkdale

0.0%

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 GTA East Q4 2009

Q4 2008

Office

Vacant

Vacancy

Available

Sublet

Availability

Net Absorption

Inventory

Space

Rate

Space

Availability

Rate

Q4 2009

12 Months

December-09 Buildings Concentration

Class Surveyed

Avg.

Net

Asking Net

Asking Gross

New Supply

Under

Q4 2009

Construction

Rental Rates Rental Rates

GTA EAST

112

14,778,342

1,389,098

9.4%

1,890,240

17%

13%

12%

(134,755)

(154,916)

$14.15

$26.25

TOTAL:

216

16,119,305

1,254,075

7.8%

1,979,939

16%

12%

10%

85,158

(134,952)

$11.67

$24.20

132

4,263,640

174,514

4.1%

300,358

26%

3,957

(87,392)

$9.21

$18.10

All

460

35,161,287

2,817,687

8.0%

4,170,536

17%

12%

11%

(45,641)

(377,260)

$12.60

$24.71

1,305,506

100,215

7.7%

119,381

16%

10%

1,369

(24,241)

$13.34

$29.62

1,970,719

163,979

8.3%

265,480

13%

12%

11,392

7,752

$11.77

$23.03

Consumers Road

Duncan Mill

Don Mills

430,465

31,764

7.4%

34,044

(4,853)

(8,962)

$11.08

$19.95

All

3,706,690

295,958

8.0%

418,905

10%

11%

10%

7,908

(25,451)

$12.16

$24.66

(1,216)

$14.29

$28.86

(2,597)

$9.07

$23.13

585,107

18,671

3.2%

30,305

38%

42%

1,434,305

77,596

5.4%

135,762

33%

279,478

All

2,298,890

1,091,936

39,306

3.6%

78,828

31%

3,919,804

599,639

15.3%

812,442

20%

21%

17%

29,135

0.0%

41,000

15%

96,266

4.2%

207,067

47%

13%

0 (14,723) 0 (14,723)

0 (3,813)

$0.00

$10.35

$24.53

69,496

$12.00

$28.12

(81,747)

$11.69

$25.71

543,632

25,879

4.8%

28,879

1,725

$8.68

$21.07

All

5,555,372

664,824

12.0%

920,148

21%

17%

13%

29,135

(10,525)

$11.61

$25.77

Highway 404

4,339,074

467,282

10.8%

595,058

29%

14%

13%

(11,497)

(134,612)

$16.72

$27.58

Corridor

2,535,980

140,621

5.5%

292,733

12%

26,428

(5,392)

$14.33

$25.61

1,494,387

74,780

5.0%

146,469

26%

10%

12%

8,159

(62,874)

$9.06

$15.69

All

125

8,369,441

682,683

8.2%

1,034,260

22%

12%

11%

23,090

(202,877)

$14.95

$25.42

Woodbine & Steeles

Markham

Pickering-Oshawa

3,328,669

217,644

6.5%

395,433

20%

12%

7,195

(32,364)

$13.91

$28.60

1,419,638

80,578

5.7%

170,454

19%

12%

10%

1,967

(30,708)

$10.63

$19.04

347,131

12,314

3.5%

13,664

All

5,095,438

310,535

6.1%

579,551

19%

11%

9,161

1,273,233

122,628

9.6%

178,770

14%

16%

3,829

1,724,126

27,898

1.6%

61,411

49%

3,010

(8,965)

183,832

6,736

3.7%

9,361

(4,591)

$8.99

$17.73

All

3,181,191

157,262

4.9%

249,542

15%

6,839

$13.68

$21.01

844,095

0.0%

56,569

1,967

$14.00

$27.02

519,373

17,649

3.4%

17,649

20,644

3,651

$12.00

$21.50

350

$10.40

$19.16

(62,722)

$12.55

$24.67

119,626

$14.15

$20.47

$12.56

$24.92

106,069

186,620

0.0%

#DIV/0!

16%

(10,663)

$0.00

All

1,550,088

17,649

1.1%

74,218

22,611

(5,046)

$13.70

$26.19

Scarborough

1,745,072

423,353

24.3%

435,896

25%

17%

(137,618)

(153,572)

$12.03

$23.95

Town Centre

1,669,589

113,737

6.8%

191,628

11%

11,191

23,566

$9.94

$22.94

652,216

6,842

1.0%

10,742

16%

650

(1,178)

$8.27

$23.11

All

4,066,877

543,931

13.4%

638,266

16%

13%

(131,184)

$11.29

$23.61

Toronto East

265,650

0.0%

#DIV/0!

925,771

32,379

3.5%

32,379

145,879

16,200

11.1%

16,200

11%

10%

All

1,337,300

48,579

3.6%

48,579

0.0%

(125,777)

0 (3,886) 0 (3,886)

0 (40,512)

$0.00

$9.65

$23.74

(1,200)

$7.00

$20.43

(41,712)

$8.77

$22.64

Currently

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 GTA West December-09 Buildings

Q4 2009 Q4 2008 Availability Availability

Office

Vacant

Vacancy

Available

Sublet

Space

Rate

Space

Availability

Rate

Absorption

Net Absorption

Avg. Asking Net

Avg. Asking Gross

Net New Supply

Currently Under

Q4 2009

12 Months

Rental Rates

Q4 2009

Construction

189,513

546,984

90,000

150,040

Concentration

Class Surveyed

Inventory

GTA WEST

220

22,354,946

1,626,585

7.3%

2,435,495

28%

11%

81,816

529,742

$15.47

$27.29

TOTAL:

266

16,144,155

1,049,033

6.5%

1,603,608

18%

10%

105,559

(651,316)

$14.03

$24.30

200

7,456,243

621,036

8.3%

826,704

11%

(108,836)

(374,238)

$12.89

$21.33

All

686

45,955,344

3,296,655

7.2%

4,865,807

21%

11%

78,539

(495,812)

$14.51

$25.18

Airport Corporate

2,323,537

337,447

14.5%

411,281

39%

18%

17%

(45,779)

(166,176)

$16.32

$29.95

Centre

1,862,308

136,074

7.3%

170,565

36%

59,468

(68,701)

$14.76

$27.86

1,354,302

230,168

17.0%

310,883

23%

14%

(41,700)

(102,793)

$14.45

$23.49

All

5,540,147

703,690

12.7%

892,730

27%

16%

12%

(28,011)

(337,670)

$15.28

$26.93

Airport East

Airport West

Bloor Islington

Brampton

Burlington

Cooksville

Hwy 401 Hurontario

953,164

117,210

12.3%

207,340

24%

22%

12%

(13,137)

(42,676)

$14.26

$28.36

2,180,742

425,563

19.5%

567,173

18%

26%

20%

32,123

(288,838)

$13.37

$24.48

961,197

157,460

16.4%

204,460

21%

18%

(26,693)

(126,398)

$13.56

$20.31

All

4,095,103

700,234

17.1%

978,973

16%

24%

18%

(7,707)

(457,912)

$13.65

$24.42

2,586,335

94,727

3.7%

114,987

91,800

505,038

$14.38

$23.07

1,365,133

24,860

1.8%

26,420

37%

(42,540)

$12.11

$22.20

530,819

48,565

9.1%

50,801

10%

(1,934)

$7.64

$16.54

All

4,482,287

168,153

3.8%

192,208

91,810

460,564

$12.33

$21.26

2,420,985

180,553

7.5%

244,643

46%

10%

(6,517)

(78,654)

$14.13

$30.09

1,449,255

67,417

4.7%

98,925

11%

(12,266)

(26,845)

$12.00

$26.50

583,479

19,510

3.3%

20,716

11%

(17,155)

$12.16

$18.96

All

4,453,719

267,481

6.0%

364,284

34%

(18,783)

(122,655)

$13.11

$27.68

864,299

36,790

4.3%

120,915

14%

(21,502)

(55,428)

$12.23

$15.99

1,448,293

3,100

0.2%

3,100

3,497

3,505

$9.00

$17.64

44,946

8,046

17.9%

8,046

18%

(2,000)

(3,100)

$10.00

$20.00

All

2,357,538

47,936

2.0%

132,061

(20,005)

(55,023)

$12.02

1,781,029

164,900

9.3%

243,852

23%

14%

27,222

(50,756)

$17.13

$27.92

1,422,232

41,076

2.9%

85,477

3,660

(60,613)

$12.39

$21.76

1,032,123

66,662

6.5%

92,066

10%

(1,573)

(13,872)

$10.38

$17.16

All

4,235,384

272,638

6.4%

421,395

16%

10%

29,310

(125,240)

$14.82

$24.51

745,927

11,922

1.6%

14,658

3,200

6,683

$15.11

$29.02

736,027

77,964

10.6%

80,698

11%

19,179

3,805

$18.51

$28.90

332,368

32,365

9.7%

32,365

10%

(8,862)

$5.50

$16.50

All

1,814,322

122,251

6.7%

127,722

22,379

1,626

$14.43

$25.60

1,858,384

108,543

5.8%

272,398

82%

15%

(51,625)

(103,011)

$12.97

$24.53

711,944

36,150

5.1%

38,497

12%

22,120

49,528

$13.96

$24.78

638,500

1,300

0.2%

1,300

(11,300)

$10.75

$20.00

All

3,208,828

145,993

4.5%

312,196

73%

10%

(29,505)

(64,783)

$13.13

$24.55

COLLIERS TORONTO ONE, OFFICE STATISTICS - Q4 2009 GTA West December-09 Buildings

Q4 2009 Q4 2008 Availability Availability

Office

Vacant

Vacancy

Available

Sublet

Inventory

Space

Rate

Space

Availability

Rate

Absorption

Net Absorption

Avg. Asking Net

Avg. Asking Gross

Net New Supply

Currently Under

Rate

Q4 2009

12 Months

Rental Rates

Q4 2009

Construction

99,513

375,700

21,244

Concentration

Class Surveyed

Mississauga

3,367,723

185,105

5.5%

269,219

(5,123)

98,898

$17.54

$33.03

City Centre

396,735

4,934

1.2%

14,567

(1,429)

(1,306)

$15.57

$27.07

0.0%

$0.00

All

3,764,458

2,608,148

2,199,084

1,263,183

All

6,070,415

1,167,628

1,026,449

409,662

All

3,301,770

Meadowvale

Oakville

Sheridan

190,039

5.0%

283,786

(6,552)

97,593

$17.38

$32.55

93,728

3.6%

130,878

28%

96,125

310,935

$15.24

$24.90

38,826

1.8%

58,557

36%

(1,096)

(79,250)

$15.57

$27.03

10,771

0.9%

10,771

73%

(25,920)

(66,431)

$14.70

$26.00

143,325

2.4%

200,206

33%

69,109

165,253

$15.30

$25.83

71,298

6.1%

101,603

11%

7,153

50,252

$16.97

$29.04

32,518

3.2%

83,118

43,571

(37,861)

$14.47

$18.07

6,750

1.6%

9,996

(10,961)

(8,563)

$13.69

$26.49

165,735

5.0%

402,289

24%

12%

39,763

3,828

$15.63

$23.48

392,049

48,535

12.4%

78,044

20%

17%

54,638

$18.95

$30.75

1,333,685

42,531

3.2%

89,188

(63,269)

(102,201)

$12.37

$21.85

372,365

17,019

4.6%

17,019

(13,830)

$8.55

$16.89

All

2,098,099

108,085

5.2%

184,251

(63,269)

(61,392)

$14.66

$24.97

CB RICHARD ELLIS

Toronto Office

www.cbre.ca/research

Fourth Quarter 2009

There were two significant turning points for the

not vacated their previous premises. This

the fourth quarter of 2009: the end of the

quarters

Greater Toronto Area (GTA) office market in Canadian recession; and the delivery of another major office tower in the Downtown

market, meaning that the bulk of the new office

Quick Stats Current Vacancy

9.4%

Net Rent (psf)

$17.35

Net Absorption (SF)

692,884

Completions (SF)

Change from last Yr.

Qtr.

1,225,623

*The arrows are trend indicators over the specified time period and do not represent a positive or negative value. (e.g., absorption could be negative, but still represent a positive trend over a specified period.)

developments in the GTA have been delivered to market. Statistics Canada confirmed in the fourth quarter that Canada came out of the

recession in September with a 0.4% increase in Gross Domestic Product (GDP), followed with a

gain of 0.2% in October. While this growth is

encouraging, the economy is still 3.2% smaller than in the same period of 2008.

With the delivery of Menkes’ Telus Tower at 25 York Street, the Downtown Toronto market has now received 3.1 million SF of the 4.6 million SF which has been under construction. The

Hot Topics

• Over 4.0 million SF of new supply was completed in 2009; a new single year record for the GTA.

• A statistical anomaly occurred in the

third and fourth quarters in terms of absorption, however, over the next two to four quarters this important demand benchmark should normalize.

• The Suburban market has given more

space back in the last four quarters than what was absorbed throughout 2008.

remaining 1.5 million SF will be delivered through Maple Leaf Square (200,000 SF), the

TEDCO Corus Building (450,000 SF), 18 York

Street (641,000 SF) and 111 Richmond Street West (225,000 SF). With the majority of new

construction (69.0%) successfully delivered to market and a further 657,000 SF expected in the first quarter of 2010, it seems that this

recession will not mirror the 1991-1992 period that was hallmarked by the failure of the original Bay-Adelaide Centre.

The statistical anomaly in absorption that was

reported in the third quarter continues to occur and has resulted in 692,884 SF of positive quarterly net absorption for the GTA. The

anomaly is rooted in the methodology used to

calculate absorption* which includes pre-leased new

construction

completions

positive

absorption despite the fact that tenants have

* CB Richard Ellis measures absorption by subtracting the change in inventory quarter-over-quarter (q/q) from the change in occupied space (q/q).

anomaly will work itself out in the coming with

exaggerated

negative

absorption as tenants vacate their old space.

The new inventory has helped to push the

GTA vacancy rate up 30 basis points (bps) to 9.4%, a level not seen since the third

quarter of 2006 and there is no indication that the vacancy level has topped out. Rising

vacancy rates were the prevailing story across the GTA with the exception of GTA

North, which experienced declining vacancy in all submarkets, and GTA West, which was virtually flat quarter-over-quarter. In

general,

the

Suburban

markets

outperformed the Central market in the

fourth quarter with vacancy increasing less than 10 bps and asking rents increasing

$0.10 psf, whereas the Central market experienced a 50 bps increase in vacancy

and a $0.53 psf decline in rental rates. The biggest asking rate decline was in the

Downtown Class A segment, which saw

almost an 8.0% decline in rates. This is

directly due to the supply-demand equation shifting strongly in favour of supply with the new office towers coming into play.

The market fundamentals all point to continuing weakness in the GTA office market; however, the pace of the decline has been much slower than thought due to

better job preservation than expected. There

will need to be significant job creation over the next few years for the market to fully

digest the new inventory. In the meantime, consolidation,

refurbishment,

and

realignment will be the industry buzzwords in 2010.

Vacancy Rate

Sublease % of Vacancy

8.3%

26.1%

-100,411

30.1%

84,078

127,030

692,884

2,494,045

Submarket

Inventory

Downtown

63,329,759

East

25,050,589

13.9%

31,852,180

11.6%

Midtown

14,664,104

North

11,551,502

West GTA

146,448,134

7.1%

25.4% 16.8%

7.0%

22.0%

9.4%

New Construction

22.7%

Central Suburbs

2,500

SF (000's)

2,000 1,500 1,000 500 0

4Q08

1Q09

2Q09

Economic Trends

3Q09

1,498,000

-154,641

439,385

869,015

$24.08 $16.62 $12.92 $16.76 $14.60

$17.35

The total GTA inventory rose by 1.0% this quarter, the majority of which was delivered through the completion of the Menkes Telus Tower at 25 York Street (780,000 SF) in the Downtown South market. Of the major new builds in the Downtown market, only 15 York Street (207,000 SF), 18 York Street (641,000 SF), and the TEDCO Corus Building (450,000 SF) have yet to be completed. The remaining space was delivered in the GTA West with five new completions: Meadowvale saw the most activity with three completions totaling 275,000 SF; Mississauga South saw the completion of 100,000 SF project at 2699 Speakman Drive; and a 70,720 SF project was completed in the Highway 10 â&#x20AC;&#x201C; Highway 401 Corridor at 75 Courtneypark Drive.

GDP % Change

Employment % Change

1.0% 0.0% -1.0%

3Q09

424,473

Net Rental Rate ($ psf/yr)

4Q09

2.0%

-2.0%

4Q09 Net 4Q09 Under Absorption (SF) Construction (SF)

MarketView Toronto Office

Market Statistics

4Q09

1Q10*

2Q10*

The Toronto economy continues to struggle, even in light of recent good news for the Ontario economy. The unemployment rate in Toronto settled at 9.7% in the fourth quarter, up from 9.2% in the previous quarter, while the rate in Ontario rose to 9.3% from 9.2% last quarter. Much of the provincial job losses are thought to be in manufacturing and construction which would have been the primary beneficiaries of stimulus spending and bailouts. The fourth quarter also marked the third consecutive quarter of GDP growth for Toronto and a return to levels not seen since the fourth quarter of 2008.

3Q10*

* Forecasted

Page 2 ÂŠ 2010 CB Richard Ellis Limited, Real Estate Brokerage

Fourth Quarter 2009

Source: Conference Board of Canada

Suburbs

12% 10% 8% 6% 4% 2%

4Q08

1Q09

2Q09

3Q09

4Q09 Central

Net Rental Rates

Suburbs

$25.00 $20.00 $ psf

$15.00 $10.00 $5.00

4Q08

1Q09

2Q09

3Q09

The fourth quarter of 2009 saw net rental rates begin to retreat in line with the rising vacancy rate in some markets. Most significantly, it appears as though the new supply and 1.5 million SF of sublease space in the Central market has finally caught up with rental rates as they fell 2.3%, or $0.53 psf, to $22.44 psf. Nowhere was this more pronounced than in the Downtown Class A category where a $2.40 psf drop was recorded, or almost 8.0%, to $27.63 psf, virtually the same level as this time last year. The Suburban markets edged up slightly by $0.10 psf, but rates are expected to decrease in 2010.

4Q09 Central

Absorption

Suburbs

1,600 1,200 800 SF (000's)

The overall GTA vacancy rate climbed another 30 bps in the fourth quarter to 9.4%. This is a full 260 bps higher and 4.1 million SF more vacant space than in the fourth quarter of 2008. Without a major unforeseen event, the vacancy rate will almost certainly enter into double-digit territory in the first quarter of 2010, a level not seen since 2005. Vacancy levels actually bucked the trend and dropped in all GTA North markets, and some GTA West markets. As a result, the Suburban markets look virtually flat in terms of vacancy rate growth, while the Central markets saw a 50 bps increase in the overall rate to 7.3%. This increase is principally due to the continued delivery of new product to the Downtown market.

MarketView Toronto Office

Central

Vacancy Rate

400 0

The Central market posted 324,062 SF of positive net absorption in the fourth quarter, but if you take out the 669,278 SF of positive absorption in the Downtown South Class A (Telus Tower), the story would be much the same as the third quarter with very little leasing activity and a large amount of negative absorption. The Suburban market recorded positive 368,822 SF of absorption in the fourth quarter, which breaks the streak of three consecutive quarters of negative net absorption. Absorption for the GTA as a whole was flat with only 131,756 SF of positive net absorption for the year.

-400 4Q08

1Q09

2Q09

3Q09

4Q09

Page 3 ÂŠ 2010 CB Richard Ellis Limited, Real Estate Brokerage

Fourth Quarter 2009

-800

Midtown Market

Notwithstanding the completion of the Telus Tower, it was another poor quarter for the Central market. If you strip out the 669,278 SF of positive absorption that was contributed by the Telus Tower, the result would be significant negative absorption. The new buildings masked the weak fundamentals that currently exist in the Central market. The vacancy rate climbed 50 bps to 7.3%, which is the highest rate since the fourth quarter of 2006. Sublet availabilities continued to increase as an additional 117,058 SF come onto the market in the third quarter.

The Midtown market posted 100,411 SF of negative absorption in the fourth quarter. This came on the heels of the first quarter of positive absorption for the Midtown market since the beginning of 2008. All three submarkets experienced negative absorption, although as a percentage of total inventory the St. Clair/Yonge market lost the most with negative 24,429 SF. The vacancy rate rose from 7.7% in the third quarter to 8.3%, the same level as in the second quarter of 2009.

The overall quoted asking net rental rate closed the quarter at $22.44 psf, down $0.53 psf from the third quarter. This remains close to the historical high for the Central market thanks to large block availabilities in Toronto’s new marquee towers. Significant Central market transactions this quarter include:

•Baker & McKenzie LLP renewed 38,000 SF at 181 Bay Street

•Department of Justice subleased 25,450 SF at 130 King Street West •Allianz Group leased 30,000 SF at 130 Adelaide Street West

Despite the negative absorption, the overall quoted asking net rental rate rose for the first time in 2009, ending the quarter up $0.09 psf at $16.62 psf. Significant Midtown market transactions this quarter include:

•Systemware Innovation Corp. leased 21,278 SF at 2300 Yonge Street •Ontario Education Collaborative Marketplace leased 12,000 SF at 90 Eglinton Avenue West •DIGI Group Inc. leased 6,171 SF at 1200 Bay Street

Greater Core

Financial Core

The statistical jumps that occurred in the Greater Core as a result of the opening of the RBC Centre last quarter were erased in the fourth quarter. Absorption had surged by 839,132 SF in the third quarter, but fell back to negative 56,238 SF in the fourth quarter. Net rental rates, which rose by an astonishing $3.87 psf in the third quarter, dropped $3.24 psf in the fourth quarter to end at $21.93 psf. Vacancy continued to rise, but at a more moderate pace of 30 bps to 7.0%. The market will take a few quarters to fully absorb the space in the new RBC Centre, which still has 320,000 SF available.

Similar to the Greater Core, the Financial Core changed course after the third quarter. Net rental rates fell $1.08 psf to $28.01 psf, the lowest level since the end of 2007. Similarly, after positive absorption in the third quarter due to the opening of the Bay-Adelaide Centre, the absorption number for the fourth quarter came in at negative 208,161 SF, in line with the rest of the City and expectations.

The Class B market fared the best this quarter, as both vacancy (6.5%) and net rental rates ($17.24 psf) dropped, while absorption remained positive. This resiliency is most likely due to economic considerations. Significant Greater Core transactions this quarter include:

•The Insurance Institute of Canada leased 22,361 SF at 18 King Street East •Genest Murray LLP leased 7,500 SF at 200 King Street West

MarketView Toronto Office

Central Toronto

The vacancy rate continued to climb, up 80 bps to 7.8%. This number is expected to climb further in the coming quarters as the market struggles with slow growth. Significant Financial Core transactions this quarter include:

•Beard Winter LLP renewed their lease of 40,000 SF at 130 Adelaide Street West

•Deloitte & Touche renewed their lease of 42,000 SF at 121 King Street West •MacQuarrie Bank Ltd. leased 34,000 SF at 181 Bay Street

Fourth Quarter 2009

Page 4

North Market

In 2009, the Suburban market shed 100,000 SF more than it absorbed throughout all of 2008. Net absorption was positive 368,822 SF for the fourth quarter. This was largely due to 439,385 SF of absorption in the West. This was tempered by loses in the East, and a minor gain in the North. This caused the vacancy rate to remain virtually unchanged, up only 10 bps to 11.7%; the highest Suburban vacancy rate since the third quarter of 2005.

The North market built upon the gains reported in the third quarter with the second straight quarter of positive absorption, at 84,078 SF in the fourth quarter. Vacancy rates dropped from 7.7% to 7.0% and the net rental rate increased $0.04 psf to $16.76 psf. Again, similar to the third quarter, most of the leasing activity took place in the Class B market with the vacancy rate dropping 180 bps to 2.4%. This was driven by 64,998 SF of positive absorption in the North Yonge Class B market, which brought the North market as a whole to virtually flat absorption for 2009 at negative 472 SF, which is positive news in light of the economic environment.

The overall quoted asking net rental rate rose a nominal $0.10 psf to close the quarter at $14.00 psf. Significant Suburban market transactions this quarter include:

• Royal Bank of Canada renewed 37,000 SF at 3300 Highway 7 West, Vaughan

• Ontario Lottery and Gaming Corporation renewed 77,000 SF at 4120 Yonge Street, Toronto

MarketView Toronto Office

Suburban Toronto

Significant North market transactions include:

•Toronto Transit Commission subleased 33,000 SF at 5160 Yonge Street, Toronto •Ontario Realty Corporation leased 16,000 SF at 5001 Yonge Street, Toronto

• Just Energy Corporation leased 46,236 SF at 6345 Dixie Road, Mississauga.

East Market

West Market

The East market was a reflection of the GTA market as a whole this quarter. The vacancy rate rose 70 bps to a GTA high of 13.9% due to 154,641 SF of negative absorption and net rental rates dropped $0.07 psf to $12.92 psf. The malaise felt in the East market is symptomatic of conditions in the City at large. All submarkets experienced negative absorption, save minimal growth in Consumers Road and East York/Don Mills South.

After three difficult quarters, the West market showed some life in the fourth quarter. Almost 450,000 SF of new space was delivered this quarter, which resulted in 439,385 SF of positive absorption. Most of the absorption was located in the Meadowvale submarket where three new buildings totaling 275,000 SF were completed. Only Brampton and the 427 Corridor recorded negative absorption. As a result of this, the overall vacancy rate dropped 20 bps to 11.6%, the first decline in 12 months, but vacancy remains near a five year high.

The largest positive change came in the sublet market, as sublet space as a percentage of total vacant space fell from 22.5% to 16.8%. Significant East market transactions this quarter include:

•FinancialLinx renewed their 40,000 SF lease at 2001 Sheppard Avenue East, Toronto •DMTI Spatial Inc. subleased 25,500 SF at 15 Allstate Parkway, Markham

•CAA South Central Ontario subleased 25,000 SF at 100 Commerce Valley Drive, Markham

Net rental rates increased by $0.43 psf this quarter to $14.60 psf, which is down from the same time last year and reflects the worst annual performance for the West since 2003. Significant West market transactions include:

•S.P. Richards Company renewed for 66,779 SF at 1325 Clarke Street, Brampton

•Newell Industries Canada Inc. subleased 42,788 SF at 178 South Service Road, Oakville

Fourth Quarter 2009

•NCR Canada Ltd. leased 34,313 SF at 6865 Century Avenue, Mississauga

MarketView Toronto Office

Market Area Descriptions Central

78.0 million SF of office space representing 53.3% of the GTA office market

North

11.6 million SF of office space representing 7.9% of the GTA office market

East

25.1 million SF of office space representing 17.1% of the GTA office market

West

31.9 million SF of office space representing 21.8% of the GTA office market

GTA

146.5 million SF of office space

Average Asking Lease Rate Rate determined by multiplying the asking net lease rate for each building by its available space, summing the products, then dividing by the sum of the available space with net leases for all buildings in the summary.

Net Leases Includes all lease types whereby the tenant pays an agreed rent plus most, or all, of the operating expenses and taxes for the property, including utilities, insurance and/or maintenance expenses. Market Coverage Includes all competitive office buildings 10,000 square feet and greater in size. Net Absorption The change in occupied square feet from one period to the next.

Net Rentable Area The gross building square footage minus the elevator core, flues, pipe shafts, vertical ducts, balconies, and stairwell areas.

Submarket Map

Occupied Square Feet Building area not considered vacant.

Under Construction Buildings which have begun construction as evidenced by site excavation or foundation work.

Available Square Feet Available Building Area which is either physically vacant or occupied. Availability Rate Available Square Feet divided by the Net Rentable Area.

Vacant Square Feet Existing Building Area which is physically vacant or immediately available. Vacancy Rate Vacant Building Square Feet divided by the Net Rentable Area.

Normalization Due to a reclassification of the market, the base, number and square footage of buildings of previous quarters have been adjusted to match the current base. Availability and Vacancy figures for those buildings have been adjusted in previous quarters.

This disclaimer shall apply to CB Richard Ellis Limited, a real estate brokerage, and its Canadian affiliates, CB Richard Ellis Alberta Limited, CB Richard Ellis Manitoba Limited, CB Richard Ellis Advisory Services Inc., and CB Richard Ellis Québec Limitée (collectively “CBRE”). © 2010 CB Richard Ellis Limited, Real Estate Brokerage. The information set out herein (the "Information") is intended for informational purposes only. CBRE has not verified the Information and does not represent, warrant or guarantee the accuracy, correctness and completeness of the Information. CBRE does not accept or assume any responsibility or liability of any kind in connection with the Information and the recipient’s reliance upon the Information. The recipient of the Information should take such steps as the recipient may deem necessary to verify the Information prior to placing any reliance upon the Information. The Information may change and any property described in the Information may be withdrawn from the market at any time without notice or obligation to the recipient from CBRE.

For more information regarding the MarketView, please contact: Ian M. Thompson, Senior Research Analyst CB Richard Ellis 145 King Street West, Suite 600 Toronto ON M5H 1J8 T. 416.815.2346 F. 416.362.8085 Ian.Thompson@cbre.com

/pulse/ Americas Research Toronto Office Statistics - Q4 2009 Inventory (sf)

Total net absorption (sf)

YTD total net absorption (sf)

YTD total net absorption (% of stock)

Direct vacancy (sf)

Direct vacancy (%)

Total vacancy (sf)

3,066,335 0 0 3,066,335

42,736,765 17,024,126 8,170,582 67,931,473

598,883 -29,405 189,106 758,584

486,355 -153,119 124,569 457,805

1.2% -0.9% 1.5% 0.7%

2,618,512 836,477 591,260 4,046,249

6.1% 4.9% 7.2% 6.0%

4,199,036 1,037,143 677,067 5,913,246

10.1% 5.9% 4.8% 8.4%

$50.92 $37.16 $28.20 $44.74

1,754,176 0 0 1,754,176

0 0 0 0

6,588,756 8,395,905 1,470,850 16,455,511

-65,494 23,497 6,859 -35,138

-119,125 -26,047 7,926 -137,246

-1.8% -0.3% 0.5% -0.8%

365,855 455,012 529,973 1,350,840

5.6% 5.4% 36.0% 8.2%

676,652 542,851 538,798 1,758,301

10.3% 6.5% 36.6% 10.7%

$39.09 $33.69 $28.47 $32.84

0 0 0 0

Suburban Class A Class B Class C Totals

1,334,706 0 0 1,334,706

49,219,514 26,517,973 7,746,460 83,483,947

240,929 -417,001 -23,105 -199,177

-114,782 -776,579 11,104 -880,257

-0.2% -2.9% 0.1% -1.1%

3,644,785 2,731,888 748,173 7,124,846

7.4% 10.3% 9.7% 8.5%

5,247,716 3,481,272 839,213 9,568,201

10.7% 13.1% 10.8% 11.5%

$30.11 $25.61 $20.46 $27.79

1,067,451 0 0 1,067,451

Market Totals Class A Class B Class C Totals

4,401,041 0 0 4,401,041

98,545,035 51,938,004 17,387,892 167,870,931

774,318 -422,909 172,860 524,269

252,448 -955,745 143,599 -559,698

0.3% -1.8% 0.8% -0.3%

6,629,152 4,023,377 1,869,406 12,521,935

6.7% 7.7% 10.8% 7.5%

10,123,404 5,061,266 2,055,078 17,239,748

10.3% 9.7% 11.8% 10.3%

$39.74 $30.70 $24.78 $35.39

2,821,627 0 0 2,821,627

Downtown Class A Class B Class C Totals Midtown Class A Class B Class C Totals

YTD completion (sf)

Average asking rent Total vacancy (%) ($ psf)

Under construction / renovation (sf)

Kristian Halkias Senior National Research Analyst tel +1 416 304 6047 fax +1 416 304 6001 kristian.halkias@am.jll.com

Pulse • Toronto Office Statistics - Q4 2009 • 2

Downtown

Inventory (sf)

Total net absorption (sf)

YTD total net absorption (sf)

YTD total net absorption (% of stock)

Direct vacancy (sf)

Direct vacancy (%)

Total vacancy (sf)

1,100,000 0 0 1,100,000

26,153,109 6,365,052 1,388,830 33,906,991

130,777 -1,580 167,692 296,889

-15,082 -112,581 146,546 18,883

-0.1% -1.8% 10.6% 0.1%

1,707,239 361,090 91,101 2,159,430

6.5% 5.7% 6.6% 6.4%

2,364,324 450,253 97,994 2,912,571

9.0% 7.1% 7.1% 7.1%

$56.52 $45.35 $33.72 $53.49

0 0 0 0

14,735 0 0 14,735

678,463 997,092 1,105,578 2,781,133

-27,760 28,705 747 1,692

-20,673 2,456 -26,281 -44,498

-3.1% 0.2% -2.4% -1.6%

61,631 169,836 178,477 409,944

9.1% 17.0% 16.1% 14.7%

72,114 211,326 191,651 475,091

10.6% 21.2% 17.3% 7.6%

$38.31 $32.63 $29.87 $32.92

0 0 0 0

Downtown North Class A Class B Class C Totals

0 0 0 0

5,532,458 5,969,355 964,869 12,466,682

646 10,271 -10,207 710

-1,289 -8,540 -18,726 -28,555

0.0% -0.1% -1.9% -0.2%

71,272 87,904 83,885 243,061

1.3% 1.5% 8.7% 1.9%

132,276 104,140 101,514 337,930

2.4% 1.7% 10.5% 2.6%

$39.85 $33.31 $27.08 $35.73

400,000 0 0 400,000

Downtown West Class A Class B Class C Totals

1,200,000 0 0 1,200,000

7,447,495 2,556,460 2,627,810 12,631,765

512,709 -47,596 1,871 466,984

499,640 -38,618 14,268 475,290

8.0% -1.5% 0.5% 4.2%

448,271 171,250 157,021 776,542

6.0% 6.7% 6.0% 6.1%

545,540 186,036 196,390 927,966

7.3% 7.3% 7.5% 12.5%

$41.97 $30.37 $28.62 $36.85

0 0 0 0

Downtown South Class A Class B Class C Totals

751,600 0 0 751,600

2,255,754 650,448 50,000 2,956,202

218 -18,874 -10,275 -28,931

-19,778 -14,316 -10,275 -44,369

-1.3% -2.2% -20.6% -2.0%

171,033 17,191 15,297 203,521

7.6% 2.6% 30.6% 6.9%

877,359 51,682 15,297 944,338

38.9% 7.9% 30.6% 29.7%

$52.52 $35.54 $26.50 $48.34

1,354,176 0 0 1,354,176

Financial Core Class A Class B Class C Totals Downtown East Class A Class B Class C Totals

YTD completion (sf)

Average asking rent Total vacancy (%) ($ psf)

Under construction / renovation (sf)

Kristian Halkias Senior National Research Analyst tel +1 416 304 6047 fax +1 416 304 6001 kristian.halkias@am.jll.com

Pulse • Toronto Office Statistics - Q4 2009 • 3

Downtown (continued)

King & Dufferin Class A Class B Class C Totals Market Totals Class A Class B Class C Totals

Inventory (sf)

Total net absorption (sf)

YTD total net absorption (sf)

YTD total net absorption (% of stock)

Direct vacancy (sf)

Direct vacancy (%)

Total vacancy (sf)

0 0 0 0

669,486 485,719 2,033,495 3,188,700

-17,707 -331 39,278 21,240

43,537 18,480 19,037 81,054

6.5% 3.8% 0.9% 2.5%

159,066 29,206 65,479 253,751

23.8% 6.0% 3.2% 8.0%

207,423 33,706 74,221 315,350

31.0% 6.9% 3.6% 9.2%

$30.73 $24.27 $23.56 $25.17

0 0 0 0

3,066,335 0 0 3,066,335

42,736,765 17,024,126 8,170,582 67,931,473

598,883 -29,405 189,106 758,584

486,355 -153,119 124,569 457,805

1.2% -0.9% 1.5% 0.7%

2,618,512 836,477 591,260 4,046,249

6.1% 4.9% 7.2% 6.0%

4,199,036 1,037,143 677,067 5,913,246

10.1% 5.9% 4.8% 8.4%

$50.92 $37.16 $28.20 $44.74

1,754,176 0 0 1,754,176

YTD completion (sf)

Average asking rent Total vacancy (%) ($ psf)

Under construction / renovation (sf)

Kristian Halkias Senior National Research Analyst tel +1 416 304 6047 fax +1 416 304 6001 kristian.halkias@am.jll.com

Pulse • Toronto Office Statistics - Q4 2009 • 4

Midtown

Inventory (sf)

Total net absorption (sf)

YTD total net absorption (sf)

YTD total net absorption (% of stock)

Direct vacancy (sf)

Direct vacancy (%)

Total vacancy (sf)

0 0 0 0

4,210,699 4,149,951 748,887 9,109,537

-21,163 -19,791 5,019 -35,935

-81,202 -70,084 -1,273 -152,559

-1.9% -1.7% -0.2% -1.7%

224,618 214,379 53,705 492,702

5.3% 5.2% 7.2% 5.4%

447,759 271,137 57,602 776,498

10.6% 6.5% 7.7% 8.5%

$40.84 $35.03 $29.50 $37.26

0 0 0 0

Eglinton Class A Class B Class C Totals

0 0 0 0

1,515,301 2,667,444 625,362 4,808,107

-56,852 50,785 1,840 -4,227

-48,237 47,821 9,199 8,783

-3.2% 1.8% 1.5% 0.2%

99,088 183,233 49,268 331,589

6.5% 6.9% 7.9% 6.9%

137,545 197,556 54,196 389,297

9.1% 7.4% 8.7% 8.1%

$34.79 $31.54 $26.79 $31.95

0 0 0 0

St. Clair Class A Class B Class C Totals

0 0 0 0

862,756 1,578,510 96,601 2,537,867

12,521 -7,497 0 5,024

10,314 -3,784 0 6,530

1.2% -0.2% 0.0% 0.3%

42,149 57,400 427,000 526,549

4.9% 3.6% 442.0% 20.7%

91,348 74,158 427,000 592,506

10.6% 4.7% 442.0% 23.3%

$38.09 $33.81 $31.35 $35.17

0 0 0 0

Market Totals Class A Class B Class C Totals

0 0 0 0

6,588,756 8,395,905 1,470,850 16,455,511

-65,494 23,497 6,859 -35,138

-119,125 -26,047 7,926 -137,246

-1.8% -0.3% 0.5% -0.8%

365,855 455,012 529,973 1,350,840

5.6% 5.4% 36.0% 8.2%

676,652 542,851 538,798 1,758,301

10.3% 6.5% 36.6% 10.7%

$39.09 $33.69 $28.47 $32.84

0 0 0 0

YTD completion (sf)

Bloor Class A Class B Class C Totals

Average asking rent Total vacancy (%) ($ psf)

Under construction / renovation (sf)

Kristian Halkias Senior National Research Analyst tel +1 416 304 6047 fax +1 416 304 6001 kristian.halkias@am.jll.com

Pulse • Toronto Office Statistics - Q4 2009 • 5

Suburban

Inventory (sf)

Total net absorption (sf)

YTD total net absorption (sf)

YTD total net absorption (% of stock)

Direct vacancy (sf)

Direct vacancy (%)

Total vacancy (sf)

157,200 0 0 157,200

17,152,563 10,431,360 2,789,422 30,373,345

3,599 -218,119 8,471 -206,049

28,218 -281,613 26,187 -227,208

0.2% -2.7% 0.9% -0.8%

1,647,613 1,312,484 199,716 3,159,813

9.6% 12.6% 7.2% 10.4%

2,190,987 1,787,095 233,882 4,211,964

12.8% 17.1% 8.4% 13.9%

$28.37 $24.92 $19.99 $26.42

0 0 0 0

North Class A Class B Class C Totals

102,923 0 0 102,923

9,084,362 3,430,950 1,018,767 13,534,079

-117,333 10,179 10,605 -96,549

-201,787 -5,793 41,101 -166,479

-2.2% -0.2% 4.0% -1.2%

531,661 102,211 79,316 713,188

5.9% 3.0% 7.8% 5.3%

805,099 164,821 79,316 1,049,236

8.9% 4.8% 7.8% 7.8%

$35.90 $30.85 $20.35 $33.45

273,515 0 0 273,515

West Class A Class B Class C Totals

1,074,583 0 0 1,074,583

22,982,589 12,655,663 3,938,271 39,576,523

354,663 -209,061 -42,181 103,421

58,787 -489,173 -56,184 -486,570

0.3% -3.9% -1.4% -1.3%

1,465,511 1,317,193 469,141 3,251,845

6.4% 10.4% 11.9% 8.2%

2,251,630 1,529,356 526,015 4,307,001

9.8% 12.1% 13.4% 10.9%

$29.13 $24.75 $20.83 $26.90

793,936 0 0 793,936

Market Totals Class A Class B Class C Totals

1,334,706 0 0 1,334,706

49,219,514 26,517,973 7,746,460 83,483,947

240,929 -417,001 -23,105 -199,177

-114,782 -776,579 11,104 -880,257

-0.2% -2.9% 0.1% -1.1%

3,644,785 2,731,888 748,173 7,124,846

7.4% 10.3% 9.7% 8.5%

5,247,716 3,481,272 839,213 9,568,201

10.7% 13.1% 10.8% 11.5%

$30.11 $25.61 $20.46 $27.79

1,067,451 0 0 1,067,451

YTD completion (sf)

East Class A Class B Class C Totals

Average asking rent Total vacancy (%) ($ psf)

Under construction / renovation (sf)

Kristian Halkias Senior National Research Analyst tel +1 416 304 6047 fax +1 416 304 6001 kristian.halkias@am.jll.com

Toronto, Ontario Te n a n t ’ s

Guide

North

American

Markets

Fourth

Quarter

Overview

Major Transactions

The final quarter of 2009 saw a continuing increase in availability rates and decrease in average occupancy costs per SF across the Greater Toronto Area (GTA). Overall availability rates for the city rose to 11.4% from 11.2% in the previous quarter. All areas of the city followed the same trend with regards to availability with the North District seeing the largest percentage increase from 8.5% in Q3 to 9.0% in Q4. Conversely, the West District remained almost flat with less than a 0.1% increase in availability.

Tenant/Buyer

Size

Ubisoft Toronto Inc.

134,845 Office

Stream International Canada

Availability in the CBD rose from 12.4% to 12.7% over the last quarter, though class A availability actually dropped from 13.6% to 13.1%. This decrease was offset primarily by class C space, where the availability rate leapt from 7.0% in Q3 to 24.6% in Q4 due to the remarketing of an entire 190,000 SF building. While the class C market in the CBD is relatively small in absolute terms, the increase in available square footage in this class still more than offsets the decrease in class A properties.

Type

2009

Lease/Sale Lease

89,237 Office

Lease

Mosaic Sales Solutions Canada 40,859 Office

Lease

Service Employees Int’l Union 39,455 Office

Sale

FinanciaLinx Corporation

37,454 Office

Lease

Toronto Central Community Care Access Centre

32,796 Office

Lease

Securitas Canada Limited

15,736 Office

Lease

Build Toronto

14,125 Office

Lease

Meyers Norris Penny LLP

13,827 Office

Lease

Breckles Insurance Brokers Ltd. 12,538 Office

Lease

Vacancy Rate Q2 2009

Q3 2009

Q4 2009

15%

As illustrated in the Q3 market report, average gross rental rates are becoming increasingly misleading since landlords are offering increased inducements in order to keep rates high. While this practice continues, it can't fully mask the fact that average rates are dropping. Average rates across the GTA fell by $0.26/SF in the last quarter to $34.40/SF. The drop was even larger in the CBD, with rates declining from $53.69/SF in Q3 to $52.96/SF by the end of the year.

10%

0% Class A CBD

Market Trends While the overall availability rate has increased, the availability rate for class A properties declined in Q4 2009, indicating a flight to quality. After rapidly rising throughout late 2008 and most of 2009, the amount of sublease space available decreased by nearly 100,000 SF.

Tenant's Perspective The commercial real estate outlook for 2010 remains murky as the new year begins. Most analysts are predicting that availability rates will continue to rise for at least the next two quarters, while rental rates should continue to fall. However, given that certain building classes in certain areas are outperforming others, it is important that tenants be armed with as much information as possible before considering their next move.

Class B CBD

Class A Suburban

Class B Suburban

Average Rental Rates CBD

Q2 2009

Q3 2009

Q4 2009

Class A Office Class B Office

$56.60 $44.91

$57.01 $45.18

$56.52 $45.35

Suburban

Q2 2009

Q3 2009

Q4 2009

Class A Office Class B Office

$30.01 $25.53

$29.95 $25.46

$30.11 $25.62

Prepared By CresaPartners 170 University Avenue, Suite 1100 Toronto, Ontario M5H 3B3 416.862.2666 www.cresapartners.com

GREATER TORONTO AREA OFFICE REPORT 3Q09 ECONOMY Ontario is feeling the brunt of the global recession, with its overall unemployment rate up to a 15-year high of 9.4%. The Toronto Census Metropolitan Area (CMA) has an unemployment rate of 10.2%. Canada-wide, total employment has fallen by 387,000 jobs since October 2008, with 207,000 of those jobs—or 53% of the total—lost in Ontario. Manufacturing and construction took the greatest hits, with the ripple effect extending to the office sector, as evidenced by the number of tenants who have taken measures to reduce their occupancy. GDP growth for 2009 is expected to contract by 2.3%; however, employment has stabilized and some job growth was experienced in August 2009.

BEAT ON THE STREET “Tenants may be back on the street, addressing their occupancy decisions, but the likely outcome of those decisions will continue to be contractions for some time to come. With rental rates now shifting downward, the market is being perceived as much more of an opportunity – from a tenant perspective.” - Paul Morse, Senior Managing Director, Office Leasing

OVERVIEW GTA office markets saw absorption nudge its way into positive territory in the third quarter, providing some hope that the impact of the downturn will not be as severe as initially predicted. While the increase in absorption is a positive signal for GTA landlords, demand is expected to remain weak well into 2010 as a result of the severely impacted US economy. Tenants were more active in the marketplace in the third quarter, although they remain focused on the preservation of capital and minimizing cash outflow. This is resulting in a greater proportion of renewals and strong incentive to consolidate in cases where tenants have multiple locations. Overall, tenants are contracting, although there is evidence of some expansions in the government, banking and professional services sectors. While the amount of sublet space returning to market slowed over the third quarter, that could change should business continue to be pressured by weak economic fundamentals. Two significant office towers were completed in Downtown Toronto in the third quarter. Cadillac Fairview’s RBC Centre brings 1.25 million square feet (msf) of inventory to market, and Brookfield Properties’ Bay Adelaide Centre adds 1.16 msf. These buildings are approximately 73% leased, although a significant amount of space will be displaced as tenants relocate from existing buildings into these new locations. Suburban markets have been hit much harder during this downturn—relative to the first year of the 2001 contraction—from an absorption perspective. One reason for this is the close connection that many suburban businesses have to the US markets.

ECONOMIC INDICATORS GDP Growth

2007 2.3%

2008 0.4%

2009F -2.3%

CPI Growth

1.8%

2.4%

0.2%

Unemployment Employment Growth

6.4%

6.2%

8.4%

1.5%

1.4%

-1.7%

Source: TD Bank Financial – TD Economics Quarterly Economic Forecast

MARKET FORECAST VACANCY will continued to rise based on projected space returning to market. ABSORPTION will weaken below third quarter results over the next few quarters. SUBLET SPACE will increase at a slower rate over the next few quarters.

OUTLOOK

GREATER TORONTO AREA OFFICE REPORT 3Q09

OVERALL RENT VS. VACANCY CBD-Rent CBD-Vacancy

Non-CBD-Rent Non-CBD-Vacancy 15%

$25

12% $20

psf/yr

Demand is expected to remain weak in the foreseeable future as tenants continue to take the measures necessary to limit capital expenditures and cash outflow. Tenants who address occupancy decisions will be more likely to contract than expand, and to take advantage of early renewals to either negotiate more favourable leases or relocate into new buildings. Menkes’ 680,000-square foot (sf) development located at 25 York Street in the Downtown south will open in the fourth quarter, with other smaller developments following in the coming quarters. These completions, along with the displacement of space resulting from the shifting of tenants from older to newer buildings, will result in high downtown vacancy rates for premium space in the next year. With over 2.1 msf of new development yet to be completed, vacancy will decrease only when existing businesses begin to expand and market conditions become more conducive to new business development.

$15

3% $10

0% 2005

2006

2007

2008

3Q09

GTA OFFICE REPORT 3Q09

OVERALL GTA

Vacancy All Classes

Leasing Activity All Classes

Vacancy SF

Leasing Activity

Vacancy Rate 8.0%

4,000

12,000 3,500

6.0% 9,000 5.0% 7,500

(000's of sf)

7.0% 10,500

4.0%

6,000 4Q08

1Q09

2Q09

2,500 2,000 1,500

3.0% 3Q08

3,000

1,000

3Q09

3Q08

 GTA vacancy has increased from 5.1% to 7.2% since the downturn began. Total available space has increased by 3.7 msf, or 46%. In the same period during the 2001 contraction, available space had increased by 4.6 msf.  The completion of the RBC Centre and the Bay Adelaide Centre in Downtown Toronto in the third quarter added 630,000 sf of vacant space to Downtown availabilities.

4Q08

2Q09

3Q09

 Leasing activity spiked in the third quarter, due mainly to the opening of the new downtown towers. (Leasing activity associated with new inventory is recognized in the quarter the building is ready for occupancy.)  Of the total 3.8 msf leased, 1.75 msf were in the RBC Centre and the Bay Adelaide Centre.

Sublease Availability All Classes

Absorption All Classes

Sublease Availability

Absorption

3,000

1,000 600 (000's of sf)

2,500 (000's of sf)

1Q09

2,000

200 (200)

1,500 (600) 1,000

(1,000) 3Q08

4Q08

1Q09

2Q09

3Q09

 While activity in a single quarter does not support a trend, it can be a leading indicator of change to come. One key observation in the third quarter is that the rate of growth in sublet space is slowing.  Sublet space returning to market within suburban markets has begun to decelerate significantly, rising only 78,000 sf compared to almost 300,000 sf in the previous quarter. This may suggest short term market stability.

3Q08

4Q08

1Q09

2Q09

3Q09

 Absorption showed some resilience over the third quarter.  Central markets are expected to experience negative absorption in the coming quarters.

GTA OFFICE REPORT 3Q09

FINANCIAL CORE

Vacancy All Classes

Leasing Activity All Classes

Vacancy SF

Vacancy Rate

2,500

Leasing Activity 8.0%

1,350

7.0%

1,200 1,050

6.0% 1,500

(000's of sf)

2,000

5.0% 4.0%

3Q08

4Q08

1Q09

2Q09

750 600

1,000

500

900

3.0%

450

2.0%

300

3Q09

3Q08

4Q08

1Q09

2Q09

3Q09

 Available space has increased by approximately 1 msf during the past recessionary year. Of this increase, approximately 30% represents new available space introduced by the Bay Adelaide Centre.  As the remaining tenants relocate into the Bay Adelaide Centre, a significant amount of space will be displaced, driving the vacancy rate up significantly in the next few quarters.

 Leasing activity relating to tenants relocating into the Bay Adelaide Centre was recognized in the third quarter, as this development is now complete.  Tenants became more active, as competitive opportunities and realigned business strategies are enticing them back to the negotiating table.  The Laurentian Bank of Canada renewed and expanded at 130 Adelaide Street West, locking down some 90,000 sf for a 10-year term.

Sublease Availability All Classes

Absorption All Classes Absorption

600

200

500

100 (000's of sf)

(000's of sf)

Sublease Availability

400

0 (100)

300 (200) 200 3Q08

4Q08

1Q09

2Q09

3Q09

 Sublet space continued to rise over the quarter, coming to rest at about 580,000 sf. A significant new sublet to market was 56,000 sf at 33 Yonge Street. This space was originally leased by EDS and comes to market six months after Hewlett Packard’s acquisition of EDS.  It is very possible more sublet availabilities will hit the market before total sublet space finds its peak.

(300) 3Q08

4Q08

1Q09

2Q09

3Q09

 The most significant downward pressure on occupied space in the third quarter was caused by a return of space resulting from the relocation of RBC staff into the new newly completed RBC Centre and the 56,000-sf EDS sublet at 33 Yonge Street.  During the 2001 downturn, over the 11-quarter down cycle, absorption in the financial core averaged negative 110,000 sf per quarter in premium space buildings. The market is now four quarters into this current recessionary cycle, and demand has been slightly stronger at an average of negative 68,000 sf per quarter.

GTA OFFICE REPORT 3Q09

DOWNTOWN FRINGE

Vacancy All Classes Vacancy SF

Leasing Activity All Classes Leasing Activity

Vacancy Rate 1,400 6.0%

1,700

1,200

1,400

4.0% 3.0%

1,100

1,000 (000's of sf)

(000's of sf)

5.0%

800 600

2.0%

400

1.0%

200

0.0%

800

500 3Q08

4Q08

1Q09

2Q09

3Q09

3Q08

 The Downtown Fringe vacancy rate rose to 5.2% from 4.4% last quarter. Approximately 330,000 sf of additional available space will come to market in the fourth quarter, barring transacted space.  During the first quarter of 2010, in excess of 445,000 sf of additional available space will return to market, and vacancy will rise.

4Q08

1Q09

2Q09

3Q09

 The spike in leasing activity relates in part to activity at the recently completed RBC Centre.  Scotia Bank renewed 89,000 sf at 100 Yonge Street, and PricewaterhouseCoopers leased an additional 72,000 sf at 18 York Street.

Sublease Availability All Classes

Absorption All Classes

Sublease Availability

Absorption

400

400 300 (000's of sf)

(000's of sf)

300

200

200 100 0

100 (100) 0

(200) 3Q08

4Q08

1Q09

2Q09

3Q09

 Very few new sublets hit the fringe markets in the third quarter of 2009 and the result was declining sublet availability.  One significant sublet will bring approximately 27,000 sf to market in the fourth quarter. On the horizon, approximately 140,000 sf of new sublet space will hit the market in the first quarter of 2010 in the Downtown North market.

3Q08

4Q08

1Q09

2Q09

3Q09

 The spike in absorption above is for the most part a reflection of the occupied floors of the newly completed RBC Centre at the end of the third quarter.  Some of the space returning to market as a result of the RBC relocation will be recognized in the fourth quarter.

GTA OFFICE REPORT 3Q09

MIDTOWN

Vacancy All Classes Vacancy Rate

Leasing Activity

1,400

8.0%

1,200

7.0%

(000's of sf)

1,000

6.0%

800 5.0% 600 4.0%

400

250 200 (000's of sf)

Vacancy SF

Leasing Activity All Classes

2.0% 3Q08

4Q08

1Q09

2Q09

100 50

3.0%

200

150

3Q09

3Q08

 The Midtown vacancy rate has held remarkably flat during the past year, given the severity of the downturn. The vacancy rate actually fell to 5.9% from 6.4% in the Midtown Bloor market, and to 8.9% from 9.2% in the Midtown Eglinton market.  Vacancy is likely to rise in the next four quarters, as approximately 260,000 sf of larger blocks of space are being tracked to return to the midtown markets in this period. The Yonge Eglinton Market will see the lion’s share of this space.

4Q08

1Q09

2Q09

3Q09

 Four-quarter average leasing activity of approximately 200,000 sf per quarter is 35% lower than levels achieved prior to the economic downturn.  The Ontario College of Teachers purchased eight floors totaling approximately 85,000 sf at 101 Bloor St. West.

Sublease Availability All Classes

Absorption All Classes Absorption

Sublease Availability 300

100

250 (000's of sf)

(000's of sf)

0 200 150 100

(100)

(200) 50 0

(300) 3Q08

4Q08

1Q09

2Q09

3Q09

 Total sublet space continued to rise over the third quarter, coming to rest at 266,000 sf by quarter-end.  The Ontario College of Teachers transaction will result in a 64,000sf, short-term sublet coming to market, likely in the summer of 2010. This will result in about 64,000 sf returning to market at 121 Bloor Street East. Cryptologic Ltd brought 40,000 sf to market at 55 St. Clair Avenue West.

3Q08

4Q08

1Q09

2Q09

3Q09

 Demand is expected to remain weak, and occupied space is likely to fall over the coming quarters.  Most of the negative absorption in the second half of 2008 was generated by tenants relocating out of the Midtown market.

GTA OFFICE REPORT 3Q09

GTA EAST

Vacancy All Classes Vacancy SF

Leasing Activity All Classes

Vacancy Rate

Leasing Activity 12.0%

800

10.0%

600

2,900 8.0% 2,600

2,300

2,000 3Q08

4Q08

1Q09

2Q09

(000's of sf)

3,200

400

6.0%

200

4.0%

3Q09

3Q08

 Overall vacancy fell to 9.3% during the quarter, driven by leasing activity in class B space, which drove down vacancy in this asset class to 8.1% from 9.6% last quarter.  Approximately 400,000 sf in significant blocks will be returning to market, putting upward pressure on vacancy over the next four quarters.

4Q08

2Q09

3Q09

 Leasing activity is picking up in the GTA East, as evidenced by 470,000 sf completed in the third quarter.  Thales Canada Inc. leased approximately 195,000 sf at 105 Moatfield Drive and will occupy the majority of the building beginning in the second quarter of 2010. It is expected that they will displace some 165,000 sf at 1235 Ormont Drive.

Sublease Availability All Classes

Absorption All Classes

Sublease Availability

Absorption

600

400

500

300 200

400

(000's of sf)

1Q09

300 200

100 0 (100)

100

(200)

(300) 3Q08

4Q08

1Q09

2Q09

3Q09

 It is expected that 30,000 sf of space displaced as a result of the relocation of Global Credit and Collection will return to market in the second quarter of 2010.  Sublet availability is hitting its stride and will rise or fall based on transaction momentum in the quarters to come.

3Q08

4Q08

1Q09

2Q09

3Q09

 The completion of key transactions, some of which are highlighted above, helped push absorption into positive territory in the third quarter.  With a large amount of available space expected to return to market in the next three quarters, absorption is likely to shift back into negative territory, although there is a renewed strength in tenant activity in the GTA East.

GTA OFFICE REPORT 3Q09

GTA NORTH

Vacancy All Classes Vacancy Rate

Leasing Activity

1,000

8.0%

900

7.0%

800

6.0%

700

5.0%

600

4.0%

500

3.0%

400

300

(000's of sf)

Vacancy SF

Leasing Activity All Classes

2.0% 3Q08

4Q08

1Q09

2Q09

200

100

3Q09

3Q08

 The GTA North vacancy rate remains very tight at 6.6%, up from 5.8% last quarter.  Approximately 170,000 sf in significant blocks of available space will return to market during the next two quarters, and this will continue to put upward pressure on vacancy.

4Q08

2Q09

3Q09

 Leasing activity of 142,000 sf this quarter indicates that the GTA North is not yet experiencing a significant improvement in tenant activity.  Chaitons LLP completed a 22,000-sf lease transaction at 5000 Yonge Street and will be relocating at the end of the first quarter of 2010.  Collective Point of Sale Solutions leased 14,200 sf at 4576 Yonge Street and will be taking occupancy during the first quarter of 2010.

Sublease Availability All Classes

Absorption All Classes

Sublease Availability

Absorption

400

150 100 (000's of sf)

300 (000's of sf)

1Q09

200

50 0

100 (50) 0

(100) 3Q08

4Q08

1Q09

2Q09

3Q09

 Sublet space continued to rise in the third quarter, coming to rest at 320,000 sf.  There is little on the horizon in terms of additional blocks of sublet space expected to return to market.

3Q08

4Q08

1Q09

2Q09

3Q09

 Absorption was negative 40,000 sf during the quarter, slightly above the four-quarter average of negative 53,000 sf.  Some smaller transactions were completed, but the amount of space returning to market outweighed the completed transactions in the third quarter.

GTA OFFICE REPORT 3Q09

GTA WEST

Vacancy All Classes Vacancy SF

Leasing Activity All Classes Leasing Activity

Vacancy Rate 800 9.0%

3,000

6.0%

2,000

(000's of sf)

600

3.0%

1,000

200

0.0% 3Q08

4Q08

1Q09

2Q09

400

3Q09

3Q08

 The vacancy rate in the GTA West is climbing, but remains very tight at 7.9%. Demand is currently weak and multiple-location tenants are more likely to consolidate to reduce occupancy costs, further reducing occupied space.  Class A space will see over 500,000 sf come to market in the fourth quarter. This includes the completion of the 150,000-sf building at 1513 North Service Road.

4Q08

1Q09

2Q09

3Q09

 Leasing activity increased to 624,000 sf in the third quarter, still significantly below historical standards in a normal economic cycle. Most transactions are resulting in contractions of space.  Takeda Pharmaceutical leased 25,300 sf at 6750 Century Avenue at the beginning of the third quarter, for first quarter 2010 occupancy. KCI leased 25,000 sf at 75 Courtneypark Drive for early 2010 occupancy.

Sublease Availability All Classes

Absorption All Classes Absorption

Sublease Availability 400

800

300 200 (000's of sf)

(000's of sf)

600

400

100 0 (100)

200

(200)

(300)

3Q08

4Q08

1Q09

2Q09

3Q09

 Total sublet space rose to 621,000 sf in the third quarter of 2009.  5100 Spectrum Way and 110 Matheson Blvd West will see sublets of 40,000 sf and 46,000 sf respectively come to market over the fourth quarter, putting additional downward pressure on rental rates.

3Q08

4Q08

1Q09

2Q09

3Q09

 Absorption showed significant improvements during the third quarter, but still only rising to approximately zero.  Absorption should dip back into negative territory in the coming quarters, as over 750,000 sf of space will come to market across all classes over the fourth quarter of 2009.

GTA OFFICE REPORT 3Q09

MARKET/SUBMARKET STATISTICS Overall

Direct

YTD

No. of

Vacancy

Leasing

Under

Construction

Overall

Direct Wtd. Avg. Class A Net

Market/Submarket

Inventory

Bldgs.

Rate

Activity

Construction

Completions

Absorption

Rental Rate*

CENTRAL AREA

82,327,305

488

6.2%

4.7%

4,177,546

2,136,126

2,408,000

(521,350)

$24.22

Downtown

65,503,862

353

6.0%

4.5%

3,606,850

2,136,126

2,408,000

(464,513)

$25.34

Financial Core

34,359,930

116

6.7%

5.0%

1,954,398

1,159,000

(564,466)

$27.93

Downtown Fringe

31,143,932

237

5.2%

4.0%

1,652,452

2,136,126

1,249,000

99,953

$20.31

Midtown

16,823,443

135

6.9%

5.3%

570,696

(56,837)

$18.39

SUBURBAN AREA

83,321,038

850

8.2%

6.5%

2,860,786

980,940

752,769

(669,187)

$15.54

GTA East

33,272,514

321

9.3%

7.8%

1,046,289

160,000

(150,853)

$13.48

GTA North

14,738,070

131

6.6%

4.4%

367,532

57,330

162,538

(141,993)

$17.52

GTA West

35,210,454

398

7.9%

6.1%

1,446,965

923,610

430,231

(376,341)

$16.54

GTA Total

165,648,343

1,338

7.2%

5.6%

7,038,332

3,117,066

3,160,769

(1,190,537)

$19.78

* Rental rates reflect $psq. ft./year

MARKET HIGHLIGHTS SIGNIFICANT 3Q09 NEW LEASE TRANSACTIONS BUILDING

SUBMARKET

TENANT

SQ FT

BLDG CLASS

105 Moatfield Drive

GTA East

Thales Canada Inc.

195,000

100 Yonge Street 1790-1820-1830 Matheson Boulevard

Financial Core

Bank of Nova Scotia

89,000

GTA West

CCSI Technology Solutions Corp.

47,000

SQ FT

PURCHASE PRICE

85,000

$28,700,000

SQ FT

COMPLETION DATE

SIGNIFICANT 3Q09 SALE TRANSACTIONS BUILDING

SUBMARKET

BUYER

101 Bloor Street West

Midtown

The Ontario College of Teachers

SIGNIFICANT 3Q09 CONSTRUCTION COMPLETIONS BUILDING

SUBMARKET

MAJOR TENANT

333 Bay Street

Financial Core

KPMG Inc.

1,159,000

3Q 09

155 Wellington Street West

Downtown Fringe

RBC/RBC Dexia Investor Services

1,249,000

3Q 09

SIGNIFICANT PROJECTS UNDER CONSTRUCTION BUILDING

SUBMARKET

MAJOR TENANTS

SQ FT

COMPLETION DATE

25 York Street

Downtown Fringe

TELUS

780,000

4Q 09

125 Queen’s Quay East

Downtown Fringe

Corus Entertainment

476,000

4Q 09

1315 North Service Road

GTA West

Liuna

150,000

4Q 09

2465 Argentia Road

GTA West

Bank of Montreal

248,110

1Q 10

Aerocentre V (5550 Explorer Drive)

GTA West

(Pre-leasing)

227,000

2Q 10

15 York Street (Maple Leaf Square)

Downtown Fringe

(Pre-leasing)

208,000

2Q 10

18 York Street

Downtown Fringe

PricewaterhouseCoopers

657,000

3Q 11

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