Proposal_Brokerage_Advisory_Services_CW

Market Overview

Please provide your current outlook on the New York City real estate market, in particular the submarket applicable to the Premises.

The Manhattan office market remains healthy as it entered into its ninth year of the expansion cycle, but it comes with mixed signals. New leasing activity reached a record high in 2018 with 35.9 msf leased and continues at a strong pace to start 2019 with 12.1 msf leased through April. Despite steady demand, asking rents have been flat. Class A asking rents have hovered between $78.00 and $79.00 per square foot (psf) since May 2016, currently at $79.18 psf. Recent rental growth can largely be attributed to Midtown South and Downtown Class A asking rents reaching all-time highs. Vacancy has also reached double digits in 2019 to 10.2%, the first time this has occurred since October 2014. Manhattan Year-over-Year Snapshot

MIDTOWN | 243.3 MSF

Apr-19 Apr-18

MIDTOWN

Vacancy

10.2%

9.2%

Leasing Activity

7.3 msf

7.2 msf

Class A Average Asking Rent Class B Average Asking Rent

$81.83 $84.25

$62.60 $59.75

MANHATTAN | 402.0 MSF

MIDTOWN SOUTH | 69.0 MSF Apr-19 Apr-18 Vacancy 9.0% 6.8% Leasing Activity 1.8 msf 1.7 msf Class A Average Asking Rent $92.26 $82.68 Class B Average Asking Rent $75.24 $68.05

Apr-19 Apr-18

Vacancy

10.2%

8.8%

MIDTOWN SOUTH

Leasing Activity

12.1 msf

10.4 msf

Class A Average Asking Rent Class B Average Asking Rent

$79.18 $78.85

$63.69 $60.84

DOWNTOWN | 89.7 MSF

Apr-19 Apr-18

Vacancy

11.2%

9.3%

Leasing Activity

3.1 msf

1.4 msf

Class A Average Asking Rent Class B Average Asking Rent

$67.56 $62.25

DOWNTOWN

$55.33 $55.14

K HLT NY HILTON LLC | CUSHMAN & WAKEFIELD | 41