CoStar Office Report - concorde-li.com

The CoStar
Industrial Report

YEAR-END 2006

Long Island Industrial Market

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

Table of Contents

Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A

Methodology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B

Terms & Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C

Market Highlights & Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

CoStar Markets & Submarkets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Employment Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Employment & Unemployment Analysis

Inventory & Development Analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Construction Activity Map
Inventory & Development Analysis
Select Top Deliveries
Select Top Under Construction Properties

Figures at a Glance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Figures at a Glance by Building Type & Market
Figures at a Glance by Building Type & Submarket
Historical Figures at a Glance

Leasing Activity Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Leasing Activity Map
Leasing Activity Analysis
Select Top Lease Transactions

Analysis of Individual CoStar Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Brooklyn Market
Central Suffolk Market
Eastern Suffolk Market
Nassau Market
Queens Market
Staten Island Market
Western Suffolk Market

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT A

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

Methodology

The CoStar Industrial Report calculates Industrial statistics using CoStar Group's base of existing,
under construction and under renovation Industrial buildings in each given metropolitan area. All
Industrial building types are included, including warehouse, flex / research & development, distribution,
manufacturing, industrial showroom, and service buildings, in both single-tenant and multi-tenant
buildings, including owner-occupied buildings. CoStar Group's national database includes approximately
33.6 billion square feet of coverage in 1.2 million properties. All rental rates reported in the CoStar
Industrial Report are calculated using the quoted rental rate for each property.

For information on subscribing to CoStar’s Advisory reports, or for information
on CoStar’s other products and services, please contact us at 1-877-7COSTAR,

or visit our web site at www.costar.com

© Copyright 2007 CoStar Group, Inc. All Rights Reserved. Although CoStar makes efforts to ensure the accuracy and reliability of the
information contained herein, CoStar makes no guarantee, representation or warranty regarding the quality, accuracy, timeliness or
completeness of the information. The publication is provided ‘as is’ and CoStar expressly disclaims any guarantees, representations or
warranties of any kind, including those of MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

CoStar Group, Inc.
2 Bethesda Metro Center • Bethesda, MD USA 20814 • (800) 204-5960 • www.costar.com • NASDAQ: CSGP

B THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

Terms & Definitions

Availability Rate: The ratio of available space to total rentable Deliveries: Buildings that complete construction during a specified
space, calculated by dividing the total available square feet by the period of time. In order for space to be considered delivered, a
total rentable square feet. certificate of occupancy must have been issued for the property.
Available Space: The total amount of space that is currently Delivery Date: The date a building completes construction and
being marketed as available for lease in a given time period. It receives a certificate of occupancy.
includes any space that is available, regardless of whether the Developer: The company, entity or individual that transforms raw
space is vacant, occupied, available for sublease, or available at land to improved property by use of labor, capital and entrepre-
a future date. neurial efforts.
Build-to-Suit: A term describing a particular property, developed Direct Space: Space that is being offered for lease directly from
specifically for a certain tenant to occupy, with structural features, the landlord or owner of a building, as opposed to space being
systems, or improvement work designed specifically for the needs offered in a building by another tenant (or broker of a tenant)
of that tenant. A build-to-suit can be leased or owned by the ten- trying to sublet a space that has already been leased.
ant. In a leased build-to-suit, a tenant will usually have a long Existing Inventory: The square footage of buildings that have
term lease on the space. received a certificate of occupancy and are able to be occupied
Buyer: The individual, group, company, or entity that has pur- by tenants. It does not include space in buildings that are either
chased a commercial real estate asset. planned, under construction or under renovation.
Cap Rate: Short for capitalization rate. The Cap Rate is a calcula- Flex Building: A type of building designed to be versatile, which
tion that reflects the relationship between one year’s net operating may be used in combination with office (corporate headquarters),
income and the current market value of a particular property. research and development, quasi-retail sales, and including but
The Cap Rate is calculated by dividing the annual net operating not limited to industrial, warehouse, and distribution uses. A typi-
income by the sales price (or asking sales price). cal flex building will be one or two stories with at least half of the
CBD: Abbreviation for Central Business District. (See also: rentable area being used as office space, have ceiling heights of 16
Central Business District) feet or less, and have some type of drive-in door, even though the
Central Business District: The designations of Central Business door may be glassed in or sealed off.
District (CBD) and Suburban refer to a particular geographic area Full Service Rental Rate: Rental rates that include all operating
within a metropolitan statistical area (MSA) describing the level expenses such as utilities, electricity, janitorial services, taxes and
of real estate development found there. The CBD is characterized insurance.
by a high density, well organized core within the largest city of a Gross Absorption: The total change in occupied space over a
given MSA. given period of time, counting space that is occupied but not
Class A: A classification used to describe buildings that generally space that is vacated by tenants. Gross absorption differs from
qualify as extremely desirable investment-grade properties and leasing Activity, which is the sum of all space leased over a certain
command the highest rents or sale prices compared to other period of time. Unless otherwise noted Gross Absorption includes
buildings in the same market. Such buildings are well located direct and sublease space.
and provide efficient tenant layouts as well as high quality, and in Growth in Inventory: The change in size of the existing square
some buildings, one-of-a-kind floor plans. They can be an archi- footage in a given area over a given period of time, generally due
tectural or historical landmark designed by prominent architects. to the construction of new buildings.
These buildings contain a modern mechanical system, and have Industrial Building: A type of building adapted for such uses as
above-average maintenance and management as well as the best the assemblage, processing, and/or manufacturing of products
quality materials and workmanship in their trim and interior fit- from raw materials or fabricated parts. Additional uses include
tings. They are generally the most attractive and eagerly sought warehousing, distribution, and maintenance facilities. The pri-
by investors willing to pay a premium for quality. mary purpose of the space is for storing, producing, assembling,
Class B: A classification used to describe buildings that generally or distributing product.
qualify as a more speculative investment, and as such, command Landlord Rep: (Landlord Representative) In a typical lease trans-
lower rents or sale prices compared to Class A properties. Such action between an owner/landlord and tenant, the broker that
buildings offer utilitarian space without special attractions, and represents the interests of the owner/landlord is referred to as the
have ordinary design, if new or fairly new; good to excellent Landlord Rep.
design if an older non-landmark building. These buildings typical- Leased Space: All the space that has a financial lease obligation.
ly have average to good maintenance, management and tenants. It includes all leased space, regardless of whether the space is
They are less appealing to tenants than Class A properties, and currently occupied by a tenant. Leased space also includes space
may be deficient in a number of respects including floor plans, being offered for sublease.
condition and facilities. They lack prestige and must depend Leasing Activity: The volume of square footage that is commit-
chiefly on a lower price to attract tenants and investors. ted to and signed under a lease obligation for a specific building
Class C: A classification used to describe buildings that gener- or market in a given period of time. It includes direct leases,
ally qualify as no-frills, older buildings that offer basic space and subleases and renewals of existing leases. It also includes any
command lower rents or sale prices compared to other buildings pre-leasing activity in planned, under construction, or under
in the same market. Such buildings typically have below-average renovation buildings.
maintenance and management, and could have mixed or low Market: Geographic boundaries that serve to delineate core areas
tenant prestige, inferior elevators, and/or mechanical/electrical that are competitive with each other and constitute a generally
systems. These buildings lack prestige and must depend chiefly accepted primary competitive set of areas. Markets are building-
on a lower price to attract tenants and investors. type specific, and are non-overlapping contiguous geographic
Construction Starts: Buildings that began construction during a designations having a cumulative sum that matches the boundar-
specific period of time. (See also: Deliveries) ies of the entire Region (See also: Region). Markets can be further
Contiguous Blocks of Space: Space within a building that is, or is subdivided into Submarkets. (See also: Submarkets)
able to be joined together into a single contiguous space.

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT C

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

Multi-Tenant: Buildings that house more than one tenant at a Seller: The individual, group, company, or entity that sells a par-
given time. Usually, multi-tenant buildings were designed and ticular commercial real estate asset.
built to accommodate many different floor plans and designs for SF: Abbreviation for Square Feet.
different tenant needs. (See also: Tenancy). Single-Tenant: Buildings that are occupied, or intended to be
Net Absorption: The net change in occupied space over a given occupied by a single tenant. (See also: Build-to-suit and Tenancy)
period of time. Unless otherwise noted Net Absorption includes Sublease Space: Space that has been leased by a tenant and is
direct and sublease space. being offered for lease back to the market by the tenant with
Net Rental Rate: A rental rate that excludes certain expenses that the lease obligation. Sublease space is sometimes referred to as
a tenant could incur in occupying office space. Such expenses sublet space.
are expected to be paid directly by the tenant and may include Submarkets: Specific geographic boundaries that serve to delin-
janitorial costs, electricity, utilities, taxes, insurance and other eate a core group of buildings that are competitive with each
related costs. other and constitute a generally accepted primary competitive
New Space: Sometimes called first generation space, refers to set, or peer group. Submarkets are building type specific (office,
space that has never been occupied and/or leased by a tenant. industrial, retail, etc.), with distinct boundaries dependent on
Occupied Space: Space that is physically occupied by a tenant. different factors relevant to each building type. Submarkets are
It does not include leased space that is not currently occupied non-overlapping, contiguous geographic designations having a
by a tenant. cumulative sum that matches the boundaries of the Market they
Office Building: A type of commercial building used exclusively are located within (See also: Market).
or primarily for office use (business), as opposed to manufactur- Suburban: The Suburban and Central Business District (CBD)
ing, warehousing, or other uses. Office buildings may sometimes designations refer to a particular geographic area within a metro-
have other associated uses within part of the building, i.e., retail politan statistical area (MSA). Suburban is defined as including all
sales, financial, or restaurant, usually on the ground floor. office inventory not located in the CBD. (See also: CBD)
Owner: The company, entity, or individual that holds title on a Tenancy: A term used to indicate whether or not a building is
given building or property. occupied by multiple tenants (See also: Multi-tenant) or a single
Planned/Proposed: The status of a building that has been tenant. (See also: Single-tenant)
announced for future development but not yet started Tenant Rep: Tenant Rep stands for Tenant Representative. In a
construction. typical lease transaction between an owner/landlord and tenant,
Preleased Space: The amount of space in a building that has been the broker that represents the interests of the tenant is referred to
leased prior to its construction completion date, or certificate of as a Tenant Rep.
occupancy date. Time On Market: A measure of how long a currently available
Price/SF: Calculated by dividing the price of a building (either space has been marketed for lease, regardless of whether it is
sales price or asking sales price) by the Rentable Building Area vacant or occupied.
(RBA). Under Construction: The status of a building that is in the process
Property Manager: The company and/or person responsible for of being developed, assembled, built or constructed. A building is
the day-to-day operations of a building, such as cleaning, trash considered to be under construction after it has begun construc-
removal, etc. The property manager also makes sure that the vari- tion and until it receives a certificate of occupancy.
ous systems within the building, such as the elevators, HVAC, and Vacancy Rate: A measurement expressed as a percentage of the
electrical systems, are functioning properly. total amount of physically vacant space divided by the total
Quoted Rental Rate: The asking rate per square foot for a par- amount of existing inventory. Under construction space generally
ticular building or unit of space by a broker or property owner. is not included in vacancy calculations.
Quoted rental rates may differ from the actual rates paid by Vacant Space: Space that is not currently occupied by a tenant,
tenants following the negotiation of all terms and conditions in regardless of any lease obligation that may be on the space.
a specific lease. Vacant space could be space that is either available or not avail-
RBA: Abbreviation for Rentable Building Area. (See also: able. For example, sublease space that is currently being paid for
Rentable Building Area) by a tenant but not occupied by that tenant, would be considered
Region: Core areas containing a large population nucleus, that vacant space. Likewise, space that has been leased but not yet
together with adjacent communities have a high degree of eco- occupied because of finish work being done, would also be con-
nomic and social integration. Regions are further divided into sidered vacant space.
market areas, called Markets. (See also: Markets) Weighted Average Rental Rate: Rental rates that are calculated by
Relet Space: Sometimes called second generation or direct space, factoring in, or weighting, the square footage associated with each
refers to existing space that has previously been occupied by particular rental rate. This has the effect of causing rental rates
another tenant. on larger spaces to affect the average more than that of smaller
Rentable Building Area: (RBA) The total square footage of a spaces. The weighted average rental rate is calculated by taking
building that can be occupied by, or assigned to a tenant for the the ratio of the square footage associated with each rental rate to
purpose of determining a tenant’s rental obligation. Generally the square footage associated with all rental rates, multiplying the
RBA includes a percentage of common areas including all hall- rental rate by that ratio, and then adding together all the resulting
ways, main lobbies, bathrooms, and telephone closets. numbers.
Rental Rates: The annual costs of occupancy for a particular Year Built: The year in which a building completed construction
space quoted on a per square foot basis. and was issued a certificate of occupancy.
Sales Price: The total dollar amount paid for a particular property YTD: Abbreviation for Year-to-Date. Describes statistics that are
at a particular point in time. cumulative from the beginning of a calendar year through what-
Sales Volume: The sum of sales prices for a given group of build- ever time period is being studied.
ings in a given time period.

D THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

OVERVIEW

Long Island’s Vacancy Increases to 4.4%
Net Absorption Negative (1,569,650) SF in the Quarter

T he Long Island Industrial market ended the fourth quar- increased to 4.4% at the end of the fourth quarter 2006. The
ter 2006 with a vacancy rate of 4.4%. The vacancy rate vacancy rate was 4.0% at the end of the third quarter 2006, 4.1%
was up over the previous quarter, with net absorption at the end of the second quarter 2006, and 4.3% at the end of the
totaling negative (1,569,650) square feet in the fourth quarter. first quarter 2006.
Vacant sublease space decreased in the quarter, ending the quarter
at 551,257 square feet. Rental rates ended the fourth quarter at Flex projects reported a vacancy rate of 9.6% at the end
$10.30, an increase over the previous quarter. A total of 0 build- of the fourth quarter 2006, 7.7% at the end of the third quarter
ings delivered to the market in the quarter totaling 0 square feet, 2006, 7.7% at the end of the second quarter 2006, and 7.7% at
with 66,000 square feet still under construction at the end of the the end of the first quarter 2006.
quarter.
Warehouse projects reported a vacancy rate of 4.1% at the
Absorption end of the fourth quarter 2006, 3.7% at the end of third quarter
Net absorption for the overall Long Island Industrial market 2006, 3.8% at the end of the second quarter 2006, and 4.0% at
the end of the first quarter 2006.
was negative (1,569,650) square feet in the fourth quarter 2006.
That compares to positive 437,059 square feet in the third quarter Largest Lease Signings
2006, positive 678,906 square feet in the second quarter 2006,
and positive 229,249 square feet in the first quarter 2006. Sublease Vacancy
The amount of vacant sublease space in the Long Island
The Flex building market recorded net absorption of nega-
tive (411,449) square feet in the fourth quarter 2006, compared market decreased to 551,257 square feet by the end of the fourth
to positive 25,358 square feet in the third quarter 2006, negative quarter 2006, from 592,711 square feet at the end of the third
(13,625) in the second quarter 2006, and positive 317,393 in the quarter 2006. There was 620,691 square feet vacant at the end
first quarter 2006. of the second quarter 2006 and 822,556 square feet at the end of
the first quarter 2006.
The Warehouse building market recorded net absorption
of negative (1,158,201) square feet in the fourth quarter 2006 Long Island’s Flex projects reported vacant sublease space of
compared to positive 411,701 square feet in the third quarter 55,421 square feet at the end of fourth quarter 2006, down from
2006, positive 692,531 in the second quarter 2006, and negative the 69,440 square feet reported at the end of the third quarter
(88,144) in the first quarter 2006. 2006. There were 78,940 square feet of sublease space vacant at
the end of the second quarter 2006, and 152,793 square feet at
Vacancy the end of the first quarter 2006.
The Industrial vacancy rate in the Long Island market area
Warehouse projects reported decreased vacant sublease
space from the third quarter 2006 to the fourth quarter 2006.

Vacancy Rates by Building Type 1996-2006

Flex Warehouse Total Market

16%

14%

12%

Vacancy Rate 10%

8%

6%

4%

2%

0% 1997 1997 1998 1998 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 2006
1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q
1996
3q

Source: CoStar Property®

Absorption©2007 COSTAR GROUP, INC. & Deliveries U.S. VacancyTHE COSTAR INDUSTRIAL REPORT Comparison 1

Past 10 Quarters Past 10 Quarters

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

OVERVIEW

Sublease vacancy went from 523,271 square feet to 495,836 There were 66,000 square feet of Industrial space under
square feet during that time. There was 541,751 square feet at construction at the end of the fourth quarter 2006.
the end of the second quarter 2006, and 669,763 square feet at
the end of the first quarter 2006. Some of the notable 2006 deliveries include: Proposed Bldgs
(A & B), a 60,000-square-foot facility that delivered in third
Rental Rates quarter 2006 and is now 0% occupied, and 1800 Artic Ave, a
The average quoted asking rental rate for available 26,250-square-foot building that delivered in first quarter 2006
and is now 0% occupied.
Industrial space was $10.30 per square foot per year at the end
of the fourth quarter 2006 in the Long Island market area. This The largest projects underway at the end of fourth quarter
represented a 3.9% increase in quoted rental rates from the end 2006 were 1517 Smithtown Ave, a 40,000-square-foot building
of the third quarter 2006, when rents were reported at $9.91 per with 0% of its space pre-leased, and 1 Imperial Ave, a 26,000-
square foot. square-foot facility that is 100% pre-leased.

The average quoted rate within the Flex sector was $15.16 Inventory
per square foot at the end of the fourth quarter 2006, while Total Industrial inventory in the Long Island market area
Warehouse rates stood at $9.61. At the end of the third quarter
2006, Flex rates were $15.28 per square foot, and Warehouse amounted to 307,985,415 square feet in 10,000 buildings as of
rates were $9.17. the end of the fourth quarter 2006. The Flex sector consisted of
21,025,894 square feet in 546 projects. The Warehouse sector
996-2006 Deliveries and Construction consisted of 286,959,521 square feet in 9,454 buildings. Within
Warehouse During the fourth quarter 2T0ot0a6l M, a0rketbuildings totaling 0 the Industrial market there were 2,295 owner-occupied buildings
square feet were completed in the Long Island market area. This accounting for 77,297,646 square feet of Industrial space.
compares to 5 buildings totaling 104,300 square feet that were
completed in the third quarter 2006, 0 buildings totaling 0 square Reports compiled by: Juanita Reed, CoStar Property® Research
feet completed in the second quarter 2006, and 52,350 square feet Manager.
in 3 buildings completed in the first quarter 2006.

01 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 2006
q 3q 1q 3q 1q 3q 1q 3q 1q 3q 1q 3q

U.S. Vacancy Comparison

Past 10 Quarters

Long Island (New York) United States

12.0%

10.0%

Vacancy Rate 8.0%

6.0%

4.0%

2.0%

0.0%

2004 2004 2005 2005 2005 2005 2006 2006 2006 2006
3q 4q 1q 2q 3q 4q 1q 2q 3q 4q

Source: CoStar Property•

2 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

MARKETS

CoStar Markets & Submarkets

In analyzing metropolitan areas in the U.S., CoStar has developed geographic designations to help group properties together, called
Regions, Markets and Submarkets. Regions are the equivalent of metropolitan areas, or areas containing a large population nucleus,
that together with adjacent communities have a high degree of economic and social integration. Regions are then divided into
Markets, which are core areas within a metropolitan area that are known to be competitive with each other in terms of attracting
and keeping tenants. Markets are then further subdivided into smaller units called Submarkets, which serve to delineate a core group
of buildings that are competitive with each other and constitute a generally accepted competitive set, or peer group.

Markets Submarkets
Brooklyn Ind
Central Suffolk Ind North Brooklyn Ind
Eastern Suffolk Ind South Brooklyn Ind
Nassau Ind
North Central Suffolk Ind
Queens Ind Ronkonkoma/Bohemia Ind
South Central Suffolk Ind
Staten Island Ind
Western Suffolk Ind Eastern Suffolk Ind

Central Nassau Ind
Eastern Nassau Ind
Northern Nassau Ind
Southeast Nassau Ind
Southern Nassau Ind
Western Nassau Ind

Central Queens Ind
Northeast Queens Ind
Northwest Queens Ind
South Queens Ind

Staten Island Ind

Deer Park Ind
East Farmingdale Ind
Hauppauge Ind
Northwest Suffolk Ind
Southwest Suffolk Ind

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 3

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

EMPLOYMENT ANALYSIS

Total Employment by Industry Total Employment Growth

Percent of Total Employment by Industry Total Number of Jobs Added Per Year

7% Natural Resources & 2.0% Long Island (New York) U.S. Average
0% Mining
16% 24% Construction

Manufacturing Percent Growth 1.0%

Trade, Transportation &
Utilities
Information
2% Financial Activities

4% 7% Professional & Business
9% Services
Education & Health
0.0%
Services
Leisure & Hospitality

14% Other Services
Government
-1.0%
17%
2002 2003 2004 2005 2006

Source: Department of Labor, Bureau of Labor Statistics Source: Department of Labor, Bureau of Labor Statistics

Total Employment Growth Industrial* Employment Growth

Cumulative Growth in Jobs Over the Past 5 Years Number of Industrial* Jobs Added Per Year

Market Employment Inventory Difference 1.0% Long Island (New York) U.S. Average
Atlanta Growth Growth -0.30%
0.00%
8.00% 8.30% 3.00%
5.10%
Chicago 5.80% 5.80% -6.30% 0.0%
4.80%
Dallas/Ft Worth 8.60% 5.60%
-10.50%
Denver 8.90% 3.80% -0.10% Percent Growth -1.0%
1.10%
Detroit -3.90% 2.40% -1.90%
2.50%
Houston 9.70% 4.90% -2.0%

Inland Empire (California) 14.20% 24.70%

Los Angeles 3.00% 3.10% -3.0%

Northern New Jersey 3.90% 2.80%

Pittsburgh 0.30% 2.20% -4.0%

Long Island (New York) 3.10% 0.60% 2002 2003 2004 2005 2006

Source: Department of Labor, Bureau of Labor Statistics Source: Department of Labor, Bureau of Labor Statistics. * Industrial employment is defined as jobs in the
Manufacturing, and Trade, Transportation & Utilities industries
Historical Unemployment Rates

Long Island (New York) U.S. Average

7.0%

6.0%

Percent Unemployment 5.0%

4.0%

3.0%

2.0%

1.0%

0.0%
2002 1q 2002 2q 2002 3q 2002 4q 2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q

Source: Department of Labor, Bureau of Labor Statistics

4 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

INVENTORY & DEVELOPMENT

Construction Highlights in Select CoStar Markets

Color Coded by Under Construction Square Footage as a Percentage of Existing Inventory

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Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 5

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

INVENTORY & DEVELOPMENT

Historical Deliveries 1982 - 2006

4.0 Deliveries Average Delivered SF

3.5 3.4
3.0 3.2
3.0 2.9
2.4
Millions of SF 2.5

2.0 1.6
1.3
1.5 1.4
1.2

1.0 0.7 0.8 0.9 0.8 0.7 0.8

0.6 0.5
0.4 0.3 0.4 0.4
0.5 0.2 0.0 0.2

0.0

0.0

1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Source: CoStar Property® * Future deliveries based on current under construction buildings.

Construction Activity Markets Ranked by Under Construction RBA

Under Construction Inventory Average Bldg Size

Market # Bldgs Total RBA Preleased SF Preleased % All Existing U/C

Central Suffolk Ind 1 40,000 0 0.0% 26,092 40,000

Nassau Ind 1 26,000 26,000 100.0% 27,769 26,000

Western Suffolk Ind 0 0 0 0.0% 30,749 0

Eastern Suffolk Ind 0 0 0 0.0% 31,211 0

Brooklyn Ind 0 0 0 0.0% 32,623 0

Queens Ind 0 0 0 0.0% 33,268 0

Staten Island Ind 0 0 0 0.0% 48,511 0
Totals
2 66,000 26,000 39.4% 30,799 33,000
Source: CoStar Property®

Recent Deliveries Future Deliveries

Leased & Un-Leased SF in Deliveries Since 2002 Preleased & Un-Leased SF in Properties Scheduled to Deliver

Leased Un-Leased Preleased Un-Leased
0.9 70

0.8 60

0.7

0.6 50

Millions of SF T
Thousands of SF
0.5 40

0.4 30

0.3 20

0.2

0.1 10

0.0 2003 2004 2005 2006 0 2007 2q 2007 4q
2002 Source: CoStar Property®

Source: CoStar Property®

6 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

INVENTORY & DEVELOPMENT

Historical Construction Starts & Deliveries Deliveries

Square Footage Per Quarter Starting and Completing Construction

Construction Starts
0.4

0.4

0.4
0.3

0.3

Millions of SF 0.3 0.2 0.2

0.2 0.2 0.2
0.2

0.2 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1
0.1 0.1 0.0 0.1 0.0 0.1 0.0
0.1
0.1 0.0 0.0 0.0 0.0 0.1
0.0

0.0 0.0 0.0 0.0

0.0

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Recent Deliveries by Project Size Breakdown of Year-to-Date Development Based on RBA of Project

Building Size # Bldgs RBA SF Leased % Leased Avg Rate Single-Tenant Multi-Tenant

< 50,000 SF 7 96,650 50,700 52.5% $9.26 0 96,650

50,000 SF - 99,999 SF 1 60,000 0 0.0% $0.00 0 60,000

100,000 SF - 249,999 SF 0 0 0 0.0% $0.00 00

250,000 SF - 499,999 SF 0 0 0 0.0% $0.00 00

>= 500,000 SF 0 0 0 0.0% $0.00 00

Source: CoStar Property®

Recent Development by Tenancy Existing Inventory Comparison

Based on RBA Developed for Single & Multi-Tenant Use Based on Total RBA

2006 Deliveries Currently Under Construction By Building Type By Tenancy Type

7%

0% 0%

49%

51%

100% 100%
Multi
Multi Single Single 93% Warehouse Multi Single
Source: CoStar Property® Flex

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 7

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

INVENTORY & DEVELOPMENT

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������������������������ THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

8

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

INVENTORY & DEVELOPMENT

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������������������������ THE COSTAR INDUSTRIAL REPORT 9
©2007 COSTAR GROUP, INC.

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

FIGURES AT A GLANCE

Flex Market Statistics Year-End 2006

Existing Inventory Vacancy YTD Net YTD Under Quoted
Total SF Absorption Deliveries
Market # Bldgs Total RBA Direct SF Vac % Const SF Rates
92,743 92,743 7.6% (4,743) 0
Brooklyn Ind 47 1,214,046 0 0 $24.13
0
Central Suffolk Ind 68 2,211,115 273,203 280,203 12.7% (96,180) 0 0 $11.88
0
Eastern Suffolk Ind 10 317,275 00 0.0% 18,900 0 0 $22.22
15,000
Nassau Ind 187 6,826,717 738,754 767,675 11.2% 50,751 15,000 0 $17.75

Queens Ind 78 4,257,386 540,647 540,647 12.7% (98,938) 0 $14.81

Staten Island Ind 5 126,124 00 0.0% 0 0 $0.00

Western Suffolk Ind 151 6,073,231 324,660 344,160 5.7% 47,887 0 $13.74
Totals 546 21,025,894 1,970,007 2,025,428 9.6% (82,323) 0 $15.16

Source: CoStar Property®

Warehouse Market Statistics Year-End 2006

Existing Inventory Vacancy YTD Net YTD Under Quoted
Total SF Absorption Deliveries
Market # Bldgs Total RBA Direct SF Vac % Const SF Rates
2,897,718 3.9% (279,169) 9,600
Brooklyn Ind 2,248 73,656,554 2,890,718 114,550 0 $10.85

Central Suffolk Ind 832 21,272,106 1,047,094 1,090,214 5.1% 3,067 0 40,000 $8.48
0
Eastern Suffolk Ind 56 1,742,682 405,945 405,945 23.3% (189,845) 8,000 0 $7.82
0
Nassau Ind 1,984 53,460,095 2,108,213 2,228,201 4.2% (139,605) 9,500 26,000 $10.26
141,650
Queens Ind 2,060 66,869,028 2,642,296 2,650,796 4.0% (55,979) 0 $11.33

Staten Island Ind 76 3,803,299 113,000 113,000 3.0% 15,500 0 $8.00

Western Suffolk Ind 2,198 66,155,757 1,971,076 2,288,304 3.5% 503,918 0 $8.49
Totals 9,454 286,959,521 11,178,342 11,674,178 4.1% (142,113) 66,000 $9.61

Source: CoStar Property®

Total Industrial Market Statistics Year-End 2006

Existing Inventory Vacancy YTD Net YTD Under Quoted
Total SF Absorption Deliveries
Market # Bldgs Total RBA Direct SF Vac % Const SF Rates
4.0% (283,912) 9,600
Brooklyn Ind 2,295 74,870,600 2,983,461 2,990,461 114,550 0 $11.13

Central Suffolk Ind 900 23,483,221 1,320,297 1,370,417 5.8% (93,113) 0 40,000 $8.77
0
Eastern Suffolk Ind 66 2,059,957 405,945 405,945 19.7% (170,945) 8,000 0 $8.12
0
Nassau Ind 2,171 60,286,812 2,846,967 2,995,876 5.0% (88,854) 24,500 26,000 $11.13
156,650
Queens Ind 2,138 71,126,414 3,182,943 3,191,443 4.5% (154,917) 0 $12.13

Staten Island Ind 81 3,929,423 113,000 113,000 2.9% 15,500 0 $8.00

Western Suffolk Ind 2,349 72,228,988 2,295,736 2,632,464 3.6% 551,805 0 $9.21
Totals 10,000 307,985,415 13,148,349 13,699,606 4.4% (224,436) 66,000 $10.30

Source: CoStar Property®

10 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

FIGURES AT A GLANCE

Flex Submarket Statistics Year-End 2006

Existing Inventory Vacancy YTD Net YTD Under Quoted
Absorption Deliveries
Market # Bldgs Total RBA Direct SF Total SF Vac % Const SF Rates
Central Nassau Ind 46,477 46,477 4.6% 80,400 0 0 $14.66
Central Queens Ind 45 1,009,222 0 0 0.0% 11,250 0 0
Deer Park Ind 2,300 2,300 0.2% 0 $6.50
East Farmingdale Ind 11 264,825 7.7% (400) 15,000
Eastern Nassau Ind 129,601 143,101 (48,661) 0
Eastern Suffolk Ind 19 1,007,471 549,317 553,238 15.6% (70,847) 0 0 $13.94
Hauppauge Ind 0.0% 18,900 0
North Brooklyn Ind 41 1,859,359 0 0 7.2% 33,267 0 0 $11.58
North Central Suffolk Ind 152,259 158,259 7.4% 0 0 $19.09
Northeast Queens Ind 61 3,537,264 7.9% 3,200 0 0 $22.22
Northern Nassau Ind 41,500 41,500 (17,500) 0
Northwest Queens Ind 10 317,275 19,883 19,883 13.2% (55,200) 0
Northwest Suffolk Ind 82,200 82,200 2.2% 0
Ronkonkoma/Bohemia Ind 50 2,208,544 (6,000) 0 0 $15.96
South Brooklyn Ind 6,000 6,000 15.2% (40,465) 0
South Central Suffolk Ind 29 558,013 382,115 382,115 1.1% 0 0 $0.00
South Queens Ind 100 0 0 $0.00
Southeast Nassau Ind 10 252,797 3,500 3,500 15.1% (75,836) 0 0 $15.00
Southern Nassau Ind 204,161 211,161 7.8% 0 0 $39.00
Southwest Suffolk Ind 16 624,632 8.8% (7,943) 0
Staten Island Ind 51,243 51,243 8.9% (2,844) 0
Western Nassau Ind 8 275,358 49,159 49,159 (14,523) 0
Totals 76,332 76,332 76.3% 15,000
35 2,508,766 20,000 20,000 6.4% 0 0 $13.98
39,500 39,500 5.5% (2,614) 0 $12.00
11 323,268 37,000 37,000 0.0% 63,581 0 $12.06
7.5% 0 $24.13
42 1,401,784 0 0 9.6% 0
77,460 102,460 49,812
18 656,033 1,970,007 2,025,428 (82,323)

16 556,534 0 $11.21
0 $24.51
16 859,163 0 $15.00
0 $11.43
2 26,200

35 612,718

30 674,589 0 $11.50
0 $0.00
5 126,124 0 $21.89
0 $15.16
36 1,365,955

546 21,025,894

Source: CoStar Property®

Warehouse Submarket Statistics Year-End 2006

Existing Inventory Vacancy YTD Net YTD Under Quoted
Absorption Deliveries
Market # Bldgs Total RBA Direct SF Total SF Vac % Const SF Rates
Central Nassau Ind 251,465 251,465 2.7% 44,538 0 0 $9.48
Central Queens Ind 382 9,273,034 920,100 924,100 6.3% (315,635) 0 0 $10.83
Deer Park Ind 277,070 277,070 2.1% 161,976 0 0 $7.83
East Farmingdale Ind 414 14,610,397 633,486 643,486 3.7% 0
Eastern Nassau Ind 956,166 996,154 4.5% (90,452) 0
Eastern Suffolk Ind 551 13,236,036 405,945 405,945 (215,318) 0
Hauppauge Ind 675,258 982,486 23.3% (189,845) 9,500
North Brooklyn Ind 533 17,268,020 4.1% 365,972 9,600 0 $9.67
North Central Suffolk Ind 1,244,256 1,251,256 2.6% (205,182) 0 0 $10.92
Northeast Queens Ind 697 22,076,928 176,800 177,600 8.3% 8,000 0 $7.82
Northern Nassau Ind 103,250 103,250 1.0% 10,900 0 0 $7.92
Northwest Queens Ind 56 1,742,682 134,204 134,204 6.7% 56,000 0
Northwest Suffolk Ind 3.7% (66,400) 0
Ronkonkoma/Bohemia Ind 564 23,865,532 1,192,897 1,197,397 6.7% 230,261 42,850
South Brooklyn Ind 153,261 153,261 3.9% 78,036 0
South Central Suffolk Ind 1,541 47,899,423 532,335 542,155 6.4% 29,604 71,700 0 $11.94
South Queens Ind 7.1% (73,987) 0
Southeast Nassau Ind 84 2,139,867 1,646,462 1,646,462 4.2% (37,437) 0 0 $10.41
Southern Nassau Ind 337,959 370,459 2.5% (26,605) 0 0 $13.98
Southwest Suffolk Ind 337 9,951,052 426,049 426,049 6.1% 0 0 $7.08
Staten Island Ind 20,000 20,000 2.4% 5,500 0
Western Nassau Ind 50 2,015,743 638,639 718,639 3.0% (127,975) 0
Totals 232,001 232,001 1.4% 141,650
934 32,157,319 113,000 113,000 4.1% (11,614) 0 $11.36
107,739 107,739 15,500
93 2,280,645 220,050 0 $15.84
11,178,342 11,674,178 (142,113) 40,000 $8.32
569 13,923,787 $9.80
0 $7.78
707 25,757,131 0

179 5,208,452

375 10,150,260 0 $11.07
0 $9.00
54 807,470 0 $10.50
0 $7.91
573 11,843,114

457 9,505,524

76 3,803,299 0 $8.00
26,000 $9.80
228 7,443,806 66,000 $9.61

9,454 286,959,521

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 11

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market
FIGURES AT A GLANCE

Total Industrial Submarket Statistics Year-End 2006

Existing Inventory Vacancy YTD Net YTD Under Quoted
Absorption Deliveries
Market # Bldgs Total RBA Direct SF Total SF Vac % Const SF Rates
Central Nassau Ind 297,942 297,942 2.9% 124,938 0 0 $10.54
Central Queens Ind 427 10,282,256 920,100 924,100 6.2% (304,385) 0 0 $10.33
Deer Park Ind 279,370 279,370 2.0% 161,576 0
East Farmingdale Ind 425 14,875,222 763,087 786,587 4.1% (139,113) 15,000
Eastern Nassau Ind 6.0% (286,165) 0
Eastern Suffolk Ind 570 14,243,507 1,505,483 1,549,392 (170,945) 0 0 $7.94
Hauppauge Ind 405,945 405,945 19.7% 399,239 9,500
North Brooklyn Ind 574 19,127,379 827,517 4.4% (201,982) 9,600 0 $9.98
North Central Suffolk Ind 1,140,745 2.7% 0 0 $11.85
Northeast Queens Ind 758 25,614,192 1,285,756 1,292,756 8.3% (6,600) 8,000 0 $8.12
Northern Nassau Ind 196,683 1.8% 800 0
Northwest Queens Ind 66 2,059,957 185,450 197,483 6.1% 0
Northwest Suffolk Ind 140,204 185,450 4.6% (72,400) 0
Ronkonkoma/Bohemia Ind 614 26,074,076 140,204 6.0% 189,796 42,850 0 $9.17
South Brooklyn Ind 1,575,012 1,579,512 4.9% 0
South Central Suffolk Ind 1,570 48,457,436 156,761 156,761 6.4% 78,136 71,700 0 $11.94
South Queens Ind 736,496 753,316 7.3% (46,232) 0 0 $10.41
Southeast Nassau Ind 94 2,392,664 1,697,705 4.6% (81,930) 0 0 $14.30
Southern Nassau Ind 1,697,705 419,618 4.8% (40,281) 0 0 $7.75
Southwest Suffolk Ind 353 10,575,684 387,118 502,381 6.1% (41,128) 0
Staten Island Ind 502,381 2.6% 0
Western Nassau Ind 58 2,291,101 40,000 40,000 2.9% 5,500 0
Totals 678,139 758,139 2.4% (130,589) 156,650
969 34,666,085 269,001 269,001 4.4% 0 $12.03
113,000 113,000 51,967 0 $15.21
104 2,603,913 185,199 210,199 15,500 40,000
13,699,606 269,862 0 $8.69
611 15,325,571 13,148,349 (224,436) $10.38

725 26,413,164

195 5,764,986 0 $8.09
0 $14.52
391 11,009,423 0 $12.00
0 $10.53
56 833,670

608 12,455,832

487 10,180,113 0 $8.41
0 $8.00
81 3,929,423 26,000 $11.69
66,000 $10.30
264 8,809,761

10,000 307,985,415

Source: CoStar Property®

12 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

FIGURES AT A GLANCE

Flex Market Statistics Year-End 2006

Existing Inventory Vacancy Net Deliveries UC Inventory Quoted

Period # Blds Total RBA Direct SF Total SF Vac % Absorption # Blds Total RBA # Blds Total RBA Rates

2006 4q 546 21,025,894 1,970,007 2,025,428 9.6% (411,449) 0 0 0 0 $15.16
2006 3q 546 21,025,894 1,544,539 1,613,979 7.7% 25,358 1 15,000 0 0 $15.28
2006 2q 545 21,010,894 1,545,397 1,624,337 7.7% (13,625) 0 1 15,000 $15.09
2006 1q 545 21,010,894 1,457,919 1,610,712 7.7% 0 0 1 15,000 $14.79
2005 4q 545 21,010,894 1,774,001 1,928,105 9.2% 317,393 0 0 1 15,000 $13.33
2005 3q 545 21,010,894 1,969,738 2,103,790 10.0% 175,685 1 0 1 15,000 $13.09
2005 2q 544 20,920,894 1,926,354 2,163,236 10.3% 149,446 1 90,000 2 105,000 $12.78
2005 1q 543 20,900,494 1,836,957 2,121,720 10.2% (21,116) 0 20,400 2 110,400 $12.82
543 20,900,494 1,818,954 2,078,812 9.9% (42,908) 4 0 1 90,000 $12.85
2004 540 20,939,740 2,406,059 2,701,744 12.9% 583,686 2 145,754 4 214,754 $12.95
2003 538 20,725,770 2,398,047 2,707,868 13.1% 220,094 5 213,970 2 192,624 $10.51
2002 533 20,551,080 2,198,539 2,390,122 11.6% (143,056) 0 174,690 4 44,690 $14.32
2001 533 20,551,080 2,113,952 2,252,714 11.0% (137,408) 1 0 0 0 $12.70
2000 533 20,577,555 1,497,380 1,551,880 7.5% (727,309) 3 10,000 0 0
1999 530 20,493,055 1,181,745 1,421,145 6.9% (46,235) 3 84,500 2 46,000 $8.84
1998 527 20,299,805 1,279,987 1,595,767 7.9% 367,872 0 193,250 3 193,250 $9.37
1997 428,889 0 $8.10

Source: CoStar Property®

Warehouse Market Statistics Year-End 2006

Existing Inventory Vacancy Net Deliveries UC Inventory Quoted

Period # Blds Total RBA Direct SF Total SF Vac % Absorption # Blds Total RBA # Blds Total RBA Rates

2006 4q 9,454 286,959,521 11,178,342 11,674,178 4.1% (1,158,201) 0 0 2 66,000 $9.61
2006 3q 9,455 287,035,521 10,068,706 10,591,977 3.7% 411,701 4 89,300 2 66,000 $9.17
2006 2q 9,451 286,946,221 10,372,627 10,914,378 3.8% 692,531 0 5 115,300 $8.99
2006 1q 9,452 286,958,721 10,949,646 11,619,409 4.0% (88,144) 3 0 5 115,300 $9.04
2005 4q 9,450 286,917,171 10,820,545 11,489,715 4.0% 1 52,350 5 138,350 $9.06
2005 3q 9,449 286,849,871 11,993,498 12,910,162 4.5% 1,487,747 2 67,300 6 205,650 $9.05
2005 2q 9,447 286,835,221 11,792,019 12,553,422 4.4% (342,090) 2 14,650 5 167,950 $8.93
2005 1q 9,446 286,773,516 12,158,920 13,270,057 4.6% 778,340 1 73,911 7 241,861 $8.63
9,449 286,712,866 12,900,241 13,812,920 4.8% 603,513 11 101,000 6 272,911 $8.56
2004 9,448 287,297,279 13,060,328 13,851,793 4.8% (545,540) 9 606,254 8 368,524 $7.99
2003 9,453 287,791,754 13,476,316 14,479,990 5.0% 133,722 9 178,700 9 174,200 $8.15
2002 9,452 287,683,519 12,308,713 13,041,178 4.5% (1,330,577) 13 341,860 7 289,145 $8.77
2001 9,442 287,159,714 11,255,983 11,380,383 4.0% (1,136,990) 18 694,830 10 556,130 $9.52
2000 9,426 286,773,067 3.1% (2,099,285) 18 666,447 15 630,642 $6.80
1999 9,408 285,985,747 8,736,497 8,894,451 3.8% 2,839,532 8 787,320 17 773,820 $6.35
1998 9,400 285,493,388 10,525,241 10,946,663 4.4% 2,241,817 2 492,359 7 480,359 $5.61
1997 11,830,310 12,696,121 (765,960) 49,000

Source: CoStar Property®

Total Industrial Market Statistics Year-End 2006

Existing Inventory Vacancy Net Deliveries UC Inventory Quoted

Period # Blds Total RBA Direct SF Total SF Vac % Absorption # Blds Total RBA # Blds Total RBA Rates

2006 4q 10,000 307,985,415 13,148,349 13,699,606 4.4% (1,569,650) 0 0 2 66,000 $10.30
2006 3q 10,001 308,061,415 11,613,245 12,205,956 4.0% 437,059 5 104,300 2 66,000 $9.91
2006 2q 307,957,115 11,918,024 12,538,715 4.1% 678,906 0 6 130,300 $9.68
2006 1q 9,996 307,969,615 12,407,565 13,230,121 4.3% 229,249 3 0 6 130,300 $9.63
2005 4q 9,997 307,928,065 12,594,546 13,417,820 4.4% 1 52,350 6 153,350 $9.63
2005 3q 9,995 307,860,765 13,963,236 15,013,952 4.9% 1,663,432 3 67,300 7 220,650 $9.59
2005 2q 9,994 307,756,115 13,718,373 14,716,658 4.8% (192,644) 3 104,650 7 272,950 $9.47
2005 1q 9,991 307,674,010 13,995,877 15,391,777 5.0% 757,224 1 94,311 9 352,261 $9.19
9,989 307,613,360 14,719,195 15,891,732 5.2% 560,605 15 101,000 7 362,911 $9.17
2004 9,992 308,237,019 15,466,387 16,553,537 5.4% 11 752,008 12 583,278 $8.82
2003 9,988 308,517,524 15,874,363 17,187,858 5.6% 38,146 14 392,670 11 366,824 $8.24
2002 9,991 308,234,599 14,507,252 15,431,300 5.0% 353,816 13 516,550 11 333,835 $9.10
2001 9,985 307,710,794 13,369,935 13,633,097 4.4% (1,473,633) 19 694,830 10 556,130 $9.92
2000 9,975 307,350,622 10,233,877 10,446,331 3.4% (1,274,398) 21 676,447 15 630,642 $6.99
1999 9,959 306,478,802 11,706,986 12,367,808 4.0% (2,826,594) 11 871,820 19 819,820 $6.61
1998 9,938 305,793,193 13,110,297 14,291,888 4.7% 2,793,297 2 685,609 10 673,609 $5.85
1997 9,927 2,609,689 49,000
(337,071)

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 13

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

LEASING ACTIVITY

Leasing Highlights in Select CoStar Markets
Color Coded by Vacancy Rate

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Source: CoStar Property®

14 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market

LEASING ACTIVITY

Historical Rental Rates

Based on Quoted Rental Rates

Flex Warehouse Total Market

$18.00

$16.00

$14.00

Dollars/SF/Year $12.00

$10.00

$8.00

$6.00

$4.00

$2.00

$0.00

2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacancy by Available Space Type Vacancy by Building Type

Percent of All Vacant Space in Direct vs. Sublet Percent of All Vacant Space by Building Type

Long Island (New York) United States Long Island (New York) United States

4% 5%

15% 83% 17%

96% 95% 85%
Direct Sublet Flex
Direct Sublet Source: CoStar Property® Warehouse Flex Warehouse

Source: CoStar Property®

U.S. Rental Rate Comparison Future Space Available

Based on Average Quoted Rental Rates Space Scheduled to be Available for Occupancy*

Long Island (New York) United States 0.7
0.6
$12.00
0.6

$10.00

0.5

$8.00
Dollars/SF/Year
Millions 0.4

$6.00

0.3

$4.00

$2.00 0.2 0.1
0.1 0.1

$0.00

2004 2004 2005 2005 2005 2005 2006 2006 2006 2006 0.0 2007 2q 2007 3q 2008 1q 2008 2q 2008 3q
3q 4q 1q 2q 3q 4q 1q 2q 3q 4q 2007 1q

Source: CoStar Property® Source: CoStar Property® * Includes Under Construction Space

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 15

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market

LEASING ACTIVITY

Select Top Industrial Leases Based on Leased Square Footage For Deals Signed in 2006

Building Submarket SF Qtr Tenant Name Tenant Rep Company Landlord Rep Company

1 1650 Old Country Rd Eastern Nassau Ind 148,000 3rd Consumer Products Services N/A Renaissance Realty Services, LLC

2 2002 Orville Drive Ronkonkoma/BohemiaInd 128,517 2nd ELM Freight Handlers N/A Ashlind Properties

3 Business&ResearchCenterAtGardenCity Central Nassau Ind 114,474 2nd Lifetime Brands, Inc. CB Richard Ellis Corporate National Realty, LLC

4 1312 Flushing Ave North Brooklyn Ind 93,000 2nd N/A N/A Sholom & Zuckerbrot Realty Corp.

5 Swingline Bldg Northwest Queens Ind 85,000 3rd N/A N/A Sholom & Zuckerbrot Realty Corp.

6 The Redstone Building Northwest Queens Ind 70,355 3rd N/A N/A Silverman Realty Group, Inc.

7 895 Waverly Ave South Central Suffolk Ind 68,000 4th TradewindsEnvironmentalRestoration,LLC Atlantic Property Services, LLC Corporate National Realty, LLC

8 Three Village Ind Pk North Central Suffolk Ind 66,000 3rd N/A N/A Alpine Overhead Door, Inc.

9 360 Vanderbilt Motor Pky Hauppauge Ind 60,000 3rd The Mortgage Zone N/A Rechler Equity Partners, LLC

10 1401 Lakeland Ave Ronkonkoma/BohemiaInd 59,000 4th Andrea Baskets Ashlind Properties Zere Real Estate Services Inc.

11 Long Island City Business Center I Northwest Queens Ind 53,279 1st Net-A-Porter, Ltd. Coldwell Banker Commercial Properti 601 West Associates, LLC

12 Long Island City Business Center I Northwest Queens Ind 52,379 2nd N/A N/A 601 West Associates, LLC

13 5800 Third Avenue South Brooklyn Ind 52,000 3rd N/A N/A Seico Realty

14 3 Delaware Dr Western Nassau Ind 50,000 2nd ProHEALTH Care Associates N/A We’re Group

15 294 Grumman Rd W Eastern Nassau Ind 50,000 1st N/A N/A Steel Equities

16 33-02 Skillman Ave Northwest Queens Ind 49,500 2nd Calypso Christiane Celle N/A First Pioneer Properties

17 121 Morgan Ave North Brooklyn Ind 48,000 3rd N/A N/A Sholom & Zuckerbrot Realty Corp.

18 1801 Falmouth Ave Western Nassau Ind 44,800 2nd N/A N/A Sutton & Edwards, Inc.

19 3731 Horseblock Rd South Central Suffolk Ind 39,600 3rd N/A N/A Greiner-Maltz Company, Inc.

20 123 Frost St Eastern Nassau Ind 39,000 4th N/A N/A Spiegel Associates

21 58-95 Maurice Ave Central Queens Ind 38,500 4th N/A N/A M. Parisi & Son Construction, Inc.

22 Queens Industrial Center South Queens Ind 38,115 3rd N/A N/A Bobis Realty

23 185 Randolph St North Brooklyn Ind 37,000 4th N/A N/A Greiner-Maltz Company, Inc.

24 60 Austin Blvd Hauppauge Ind 36,693 4th Seating Solutions Harlowe Realty Services, Inc. AIRECO Real Estate Corp.

25 245 Babylon Farmingdale Rd Southwest Suffolk Ind 35,500 2nd Alternative Shipping & Packing Limited Reinhardt, Becker, Ford & Assoc. Metro Realty Services, LLC

26 100 Adams Blvd East Farmingdale Ind 35,192 1st N/A N/A Finkelstein Realty, Inc.

27 600 W John St Eastern Nassau Ind 34,000 3rd Art Leather Manufacturing Inc. Triangle Properties Sutton & Edwards, Inc.

28 147-35 Farmers Blvd South Queens Ind 34,000 4th N/A N/A NAI Long Island

29 600 W John St Eastern Nassau Ind 34,000 3rd Art Leather Manufacturing, Inc. Triangle Properties Sutton & Edwards, Inc.

30 425 Rabro Dr Hauppauge Ind 33,859 3rd Clearvision N/A Rechler Equity Partners, LLC

31 99 Lafayette Dr Eastern Nassau Ind 32,000 4th Keystone Automotive Industries Inc. Reinhardt, Becker, Ford & Assoc. Sutton & Edwards, Inc.

32 1293 Flushing Ave North Brooklyn Ind 32,000 3rd N/A N/A DY Realty Services LLC

33 The Redstone Building Northwest Queens Ind 31,745 2nd Torkia Gift Warehousing LLC ABH Realty Corp. Silverman Realty Group, Inc.

34 168-25 Jamaica Ave South Queens Ind 31,000 3rd N/A N/A Ingram & Hebron Realty

35 70 Marcus Blvd Hauppauge Ind 30,000 4th N/A N/A Newmark Knight Frank

36 300 Oser Ave Hauppauge Ind 30,000 1st Freedom Doors Newmark Knight Frank Heartland Development

37 106 Charles Lindbergh Blvd Central Nassau Ind 30,000 2nd OSI Pharmaceuticals N/A American Commercial Real Estate Inc

38 807 Bank St South Brooklyn Ind 30,000 2nd Q Y Distributors N/A Greiner-Maltz Company, Inc.

39 130 Hoffman Ln Hauppauge Ind 30,000 4th N/A N/A Newmark Knight Frank

40 100 & 110 Oser Ave Hauppauge Ind 25,220 2nd USA Family Outlet Centers N/A Sutton & Edwards, Inc.

Source: CoStar Property®

* Renewal

16 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market
B R O O K LY N M A R K E T
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

0.800 Delivered SF Absorption SF Vacancy 5.0%

Millions SF 0.600 4.5% Percent Vacant
0.400 4.0%
0.200 3.5%
0.000 3.0%
(0.200) 2.5%
(0.400) 2.0%
(0.600) 1.5%
(0.800) 1.0%
0.5%

(1.000) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

3.50 Direct SF Sublet SF $12.00

3.00 $10.00

2.50 Dollars/SF/Year$8.00

Millions SF 2.00 $6.00

1.50 $4.00

1.00 $2.00

0.50 $0.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q
0.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q Source: CoStar Property®

Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $11.13
2006 4q (634,786) $9.92
2006 3q 2,295 74,870,600 2,990,461 4.0% (242,769) 00 00 $9.96
2006 2q $9.66
2006 1q 2,296 74,946,600 2,431,675 3.2% (14,619) 1 9,600 00 $10.17
2005 4q 608,262 $10.09
2005 3q 2,295 74,937,000 2,179,306 2.9% 276,510 00 1 9,600 $10.21
2005 2q (97,661) $8.83
2005 1q 2,296 74,949,500 2,177,187 2.9% (64,530) 00 1 9,600 $7.81
2004 4q (53,791) $8.70
2004 3q 2,297 74,960,300 2,796,249 3.7% 110,175 00 00 $8.60
2004 2q 233,215 $8.74
2004 1q 2,297 74,960,300 3,072,759 4.1% 207,463 1 2,650 00 $8.70
2003 4q (597,890) $8.95
2003 3q 2,296 74,957,650 2,972,448 4.0% (159,924) 00 1 2,650 $8.96
2003 2q 123,842 $7.84
2003 1q 2,297 74,969,856 2,920,124 3.9% (734,847) 00 1 2,650
(663,829)
2,299 74,975,206 2,871,683 3.8% 00 00

2,299 74,975,206 2,981,858 4.0% 00 00

2,300 74,983,506 3,223,373 4.3% 00 00

2,300 74,983,506 3,430,836 4.6% 2 54,242 00

2,300 74,937,309 2,786,749 3.7% 1 11,000 2 54,242

2,300 74,930,484 2,620,000 3.5% 00 3 65,242

2,301 74,966,484 2,779,842 3.7% 00 1 11,000

2,304 75,443,270 2,521,781 3.3% 00 00

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 17

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market
CENTRAL SUFFOLK MARKET
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

0.400 Delivered SF Absorption SF Vacancy 10.0%

0.300 9.0%
0.200 8.0%
7.0%
Percent Vacant
Millions SF 0.100 6.0%
0.000 5.0%
4.0%

(0.100) 3.0%
(0.200) 2.0%
1.0%

(0.300) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

1.60 Direct SF Sublet SF $9.00
$8.80
1.40 $8.60
$8.40
1.20 $8.20
$8.00
Millions SF 1.00 $7.80Dollars/SF/Year
$7.60
0.80 $7.40

0.60 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

0.40 Source: CoStar Property®

0.20

0.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $8.77
2006 4q (107,676) $8.65
2006 3q 900 23,483,221 1,370,417 5.8% (26,385) 00 1 40,000 $8.52
2006 2q 87,215 $8.30
2006 1q 900 23,483,221 1,262,741 5.4% (46,267) 2 71,700 1 40,000 $8.38
2005 4q 200,299 $8.58
2005 3q 898 23,411,521 1,164,656 5.0% 00 2 71,700 $8.33
2005 2q (114,066) $7.92
2005 1q 898 23,411,521 1,251,871 5.3% 346,695 2 42,850 2 71,700 $8.02
2004 4q (37,526) $8.03
2004 3q 896 23,368,671 1,162,754 5.0% 329,882 1 67,300 3 102,850 $8.22
2004 2q 115,026 $7.87
2004 1q 895 23,301,371 1,295,753 5.6% 1 12,000 4 170,150 $7.43
2003 4q 51,657 $6.94
2003 3q 894 23,289,371 1,169,687 5.0% (231,645) 2 33,863 3 139,300 $6.97
2003 2q 175,492 $6.87
2003 1q 892 23,255,508 1,482,519 6.4% 359,326 00 5 173,163

892 23,255,508 1,444,993 6.2% (34,110) 1 127,500 3 85,463
65,940
891 23,128,008 1,647,375 7.1% 3 61,000 3 199,500

888 23,067,008 1,701,401 7.4% 00 5 248,500

888 23,067,008 1,753,058 7.6% 1 14,754 4 121,000

887 23,052,254 1,506,659 6.5% 1 36,100 2 44,754

886 23,016,154 1,646,051 7.2% 00 2 50,854

887 23,037,140 2,026,363 8.8% 1 28,450 2 50,854

886 23,008,690 1,963,803 8.5% 3 96,000 3 79,304

Source: CoStar Property®

18 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market
EASTERN SUFFOLK MARKET
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

0.200 Delivered SF Absorption SF Vacancy 25.0%

0.150

0.100 20.0%

0.050 Percent Vacant

Millions SF 0.000 15.0%

(0.050)

(0.100) 10.0%

(0.150)

(0.200) 5.0%

(0.250)

(0.300) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Sublet SF Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

0.60 Direct SF $14.00
$12.00
0.50 $10.00

Millions SF 0.40 Dollars/SF/Year$8.00
$6.00
0.30 $4.00
$2.00
0.20 $0.00

0.10 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

0.00 Source: CoStar Property®
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $8.12
2006 4q 15,600 $8.36
2006 3q 66 2,059,957 405,945 19.7% 10,500 00 00 $8.40
2006 2q 58,400 $8.40
2006 1q 66 2,059,957 421,545 20.5% (255,445) 00 00 $11.62
2005 4q (4,888) $11.40
2005 3q 66 2,059,957 432,045 21.0% 00 00 $11.19
2005 2q 0 $11.78
2005 1q 66 2,059,957 490,445 23.8% 86,000 00 00 $9.22
2004 4q 149,900 $8.75
2004 3q 66 2,059,957 235,000 11.4% (23,240) 00 00 $9.42
2004 2q (10,900) $10.18
2004 1q 66 2,059,957 230,112 11.2% (80,772) 00 00 $11.68
2003 4q (59,800) $10.94
2003 3q 66 2,059,957 230,112 11.2% 31,862 00 00 $11.02
2003 2q 33,468 $10.27
2003 1q 66 2,059,957 316,112 15.3% (8,000) 00 00
(6,600)
66 2,059,957 466,012 22.6% 00 00

66 2,059,957 442,772 21.5% 00 00

66 2,059,957 431,872 21.0% 00 00

66 2,059,957 351,100 17.0% 00 00

66 2,059,957 291,300 14.1% 00 00

66 2,059,957 323,162 15.7% 00 00

66 2,059,957 356,630 17.3% 00 00

67 2,079,957 368,630 17.7% 00 00

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 19

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market
NASSAU MARKET
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

0.800 Delivered SF Absorption SF Vacancy 8.0%

0.600 7.0%

0.400 6.0%

Millions SF 0.200 5.0% Percent Vacant

0.000 4.0%

(0.200) 3.0%

(0.400) 2.0%

(0.600) 1.0%

(0.800) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

4.00 Direct SF Sublet SF $11.50

3.50 $11.00

3.00 $10.50

Millions SF 2.50 $10.00Dollars/SF/Year

2.00 $9.50

1.50 $9.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q
1.00
Source: CoStar Property®
0.50

0.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $11.13
2006 4q (32,889) $10.65
2006 3q 2,171 60,286,812 2,995,876 5.0% 191,853 00 1 26,000 $10.39
2006 2q 119,253 $10.56
2006 1q 2,171 60,286,812 2,962,987 4.9% (367,071) 00 1 26,000 $10.03
2005 4q 342,370 $10.06
2005 3q 2,171 60,286,812 3,154,840 5.2% 122,249 00 1 26,000 $9.85
2005 2q 214,709 $9.88
2005 1q 2,171 60,286,812 3,274,093 5.4% 00 1 26,000 $9.49
2004 4q 55,593 $9.44
2004 3q 2,171 60,286,812 2,907,022 4.8% 218,912 00 1 26,000 $9.17
2004 2q 658,558 $9.00
2004 1q 2,171 60,286,812 3,249,392 5.4% 272,409 00 1 26,000 $8.94
2003 4q (602,238) $9.05
2003 3q 2,171 60,286,812 3,371,641 5.6% (19,458) 1 60,448 1 26,000 $8.99
2003 2q 198,223 $8.59
2003 1q 2,170 60,226,364 3,525,902 5.9% (72,735) 00 2 86,448
(488,540)
2,171 60,236,364 3,591,495 6.0% 00 2 86,448

2,171 60,236,364 3,810,407 6.3% 00 2 86,448

2,171 60,236,364 4,468,965 7.4% 2 165,000 00

2,169 60,071,364 4,576,374 7.6% 00 2 165,000

2,172 60,323,530 4,226,302 7.0% 00 2 165,000

2,174 60,340,230 4,223,544 7.0% 00 2 165,000

2,174 60,340,230 4,421,767 7.3% 00 1 80,000

2,174 60,340,230 4,349,032 7.2% 1 18,000 00

Source: CoStar Property®

20 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market
QUEENS MARKET
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

0.800 Delivered SF Absorption SF Vacancy 8.0%

Millions SF 0.600 7.0% Percent Vacant
0.400 6.0%
0.200 5.0%
0.000

(0.200) 4.0%

(0.400) 3.0%
(0.600) 2.0%
(0.800) 1.0%
(1.000)

(1.200) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

4.50 Direct SF Sublet SF $12.50

4.00 $12.00

3.50 $11.50

Millions SF 3.00 $11.00Dollars/SF/Year

2.50 $10.50

2.00 $10.00

1.50 $9.50
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q
1.00
Source: CoStar Property®
0.50

0.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $12.13
2006 4q (644,449) $12.34
2006 3q 2,138 71,126,414 3,191,443 4.5% 109,303 00 00 $11.58
2006 2q 514,191 $11.41
2006 1q 2,138 71,126,414 2,546,994 3.6% (133,962) 1 8,000 00 $11.18
2005 4q 539,783 $11.37
2005 3q 2,137 71,118,414 2,648,297 3.7% (151,387) 00 1 8,000 $11.01
2005 2q 503,180 $10.65
2005 1q 2,137 71,118,414 3,162,488 4.4% 113,808 00 1 8,000 $10.65
2004 4q (151,891) $11.05
2004 3q 2,137 71,118,414 3,028,526 4.3% (966,182) 00 00 $11.16
2004 2q $11.10
2004 1q 2,137 71,118,414 3,568,309 5.0% 41,990 1 90,000 00 $10.66
2003 4q (315,809) $10.13
2003 3q 2,136 71,028,414 3,326,922 4.7% (265,276) 00 1 90,000 $11.20
2003 2q 189,104 $10.18
2003 1q 2,136 71,028,414 3,830,102 5.4% 445,792 00 1 90,000

2,137 71,053,414 3,968,910 5.6% 15,263 00 1 90,000

2,139 72,063,414 4,827,019 6.7% 00 1 90,000

2,139 72,063,414 3,860,837 5.4% 00 1 90,000

2,139 72,063,414 3,902,827 5.4% 3 158,682 1 90,000

2,139 72,001,888 3,525,492 4.9% 00 4 248,682

2,142 72,052,470 3,310,798 4.6% 1 177,870 3 158,682

2,142 71,888,456 3,335,888 4.6% 00 2 184,370

2,142 71,888,456 3,781,680 5.3% 00 2 184,370

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 21

LONG ISLAND – YEAR-END 2006

Long Island Industrial Market
STATEN ISLAND MARKET
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

0.300 Delivered SF Absorption SF Vacancy 14.0%

0.250 12.0%

0.200 10.0%

Millions SF 0.150 8.0% Percent Vacant

0.100 6.0%

0.050 4.0%

0.000 2.0%

(0.050) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

0.13 Direct SF Sublet SF $9.00
$8.00
0.13 $7.00
$6.00
Millions SF 0.12 $5.00Dollars/SF/Year
$4.00
0.12 $3.00
$2.00
0.11 $1.00
$0.00
0.11
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property® Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $8.00
2006 4q 5,000 $8.00
2006 3q 81 3,929,423 113,000 2.9% 5,500 00 00 $8.00
2006 2q $8.00
2006 1q 81 3,929,423 118,000 3.0% 0 00 00 $0.00
2005 4q 5,000 $0.00
2005 3q 81 3,929,423 123,500 3.1% 00 00 $0.00
2005 2q 0 $0.00
2005 1q 81 3,929,423 123,500 3.1% (9,000) 00 00 $0.00
2004 4q $0.00
2004 3q 81 3,929,423 128,500 3.3% 0 00 00 $0.00
2004 2q (5,000) $0.00
2004 1q 81 3,929,423 128,500 3.3% 4,100 00 00 $0.00
2003 4q 274,000 $0.00
2003 3q 81 3,929,423 119,500 3.0% (18,600) 00 00 $0.00
2003 2q $0.00
2003 1q 81 3,929,423 119,500 3.0% 0 00 00
14,200
81 3,929,423 114,500 2.9% 122,100 00 00
(5,000)
81 3,929,423 118,600 3.0% 29,200 00 00

81 3,929,423 392,600 10.0% 00 00

81 3,929,423 374,000 9.5% 00 00

81 3,929,423 374,000 9.5% 00 00

81 3,929,423 388,200 9.9% 00 00

81 3,929,423 510,300 13.0% 00 00

81 3,929,423 505,300 12.9% 1 16,000 00

Source: CoStar Property®

22 THE COSTAR INDUSTRIAL REPORT ©2007 COSTAR GROUP, INC.

YEAR-END 2006 – LONG ISLAND

Long Island Industrial Market
WESTERN SUFFOLK MARKET
MARKET HIGHLIGHTS - FLEX & WAREHOUSE

Deliveries, Absorption & Vacancy Historical Analysis, Flex and Warehouse

1.000 Delivered SF Absorption SF Vacancy 7.0%

0.800 6.0%

0.600 5.0%

Millions SF 0.400 4.0% Percent Vacant

0.200 3.0%

0.000 2.0%

(0.200) 1.0%

(0.400) 0.0%

2003 1q 2003 2q 2003 3q 2003 4q 2004 1q 2004 2q 2004 3q 2004 4q 2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Vacant Space Quoted Rental Rates

Historical Analysis, Flex and Warehouse Historical Analysis, Flex and Warehouse

4.00 Direct SF Sublet SF $9.50

3.50 $9.00

3.00 $8.50

Millions SF 2.50 Dollars/SF/Year$8.00

2.00 $7.50

1.50 $7.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q
1.00
Source: CoStar Property®
0.50

0.00
2005 1q 2005 2q 2005 3q 2005 4q 2006 1q 2006 2q 2006 3q 2006 4q

Source: CoStar Property®

Existing Inventory Vacancy Net Delivered Inventory UC Inventory Quoted
Absorption Rates
Period # Bldgs Total RBA Vacant SF Vacancy % # Bldgs Total RBA # Bldgs Total RBA $9.21
2006 4q (170,450) $8.79
2006 3q 2,349 72,228,988 2,632,464 3.6% 389,057 00 00 $8.69
2006 2q (85,534) $8.32
2006 1q 2,349 72,228,988 2,462,014 3.4% 418,732 1 15,000 00 $8.24
2005 4q 309,358 $8.10
2005 3q 2,348 72,213,988 2,836,071 3.9% 00 1 15,000 $8.08
2005 2q 57,221 $7.77
2005 1q 2,348 72,213,988 2,750,537 3.8% (328,830) 1 9,500 1 15,000 $8.72
2004 4q 337,621 $8.69
2004 3q 2,347 72,204,488 3,159,769 4.4% 518,584 00 2 24,500 $7.66
2004 2q 163,904 $7.66
2004 1q 2,347 72,204,488 3,469,127 4.8% 120,482 00 2 24,500 $7.86
2003 4q (223,244) $7.42
2003 3q 2,347 72,204,488 3,526,348 4.9% 00 1 15,000 $7.49
2003 2q (52,051) $6.89
2003 1q 2,347 72,204,488 3,197,518 4.4% 192,473 1 101,000 00
120,345
2,346 72,103,488 3,434,139 4.8% 747,556 1 100,230 1 101,000

2,345 72,003,258 3,852,493 5.4% 00 2 201,230

2,345 72,003,258 4,016,397 5.6% 00 2 201,230

2,345 72,003,258 4,136,879 5.7% 2 70,600 1 100,230

2,343 71,932,658 3,843,035 5.3% 00 2 70,600

2,343 71,932,658 3,790,984 5.3% 1 7,000 2 70,600

2,342 71,925,658 3,976,457 5.5% 00 1 7,000

2,342 71,925,658 4,096,802 5.7% 1 2,250 1 7,000

Source: CoStar Property®

©2007 COSTAR GROUP, INC. THE COSTAR INDUSTRIAL REPORT 23

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