Connecticut Industrial Real Estate Market

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Connecticut Industrial Real Estate Market

• A View From the Street

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What is A View From the Street?

• No Vacancy Rates.
• No the size of the market info.
• Not a statistical review.
• If you need thosegive me a call.

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We are a spoiled bunch!

• Would we have even thought of numerous
  100,000-200,000 sf deals 3-4 years ago??!!??
• Would we have even thought of 100 million
  industrial deals 3-4 years ago??..How about 2
  years ago???How about REITS in our market???

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Things are good!!!!

• So then why is everyone so worried?!?

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Where are we today?

• Activity Continues!!!

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Big USER Deals Continue.

• New Breed North Haven 520,000 sf
• RBC Bearings Torrington 130,000 sf
• CS Wholesalers - E. Windsor 277,000 sf
• Travelers Insurance Windsor - 137,000 sf

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New Breed North Haven
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Big USER Deals (con).

• Federated Department Stores Cheshire 258,000
  sf.
• Indeco Milford 88,000 sf.
• Visual Controls Milford 146,000 sf.

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Big INVESTMENT Deals Continue.

• Cash Flow AND Vacant

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Cash Flow

• HRPT purchases the Winstanley Portfolio
• Hampshire Group purchases US Steel package in
  Meriden 560,000 sf.
• Block Kahn purchases 141 South Street, West
  Hartford 113,000 sf.
• Preferred purchases (and is ready to sell)
  Cheshire North Haven facilities

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PreferredCheshire N Haven
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Cash Flow (con)

• Benerofe Properties - 25 Research Parkway,
  Wallingford 242,000 sf.
• Elm Street - 60 Dodge Avenue, North Haven
  114,000 sf.
• JMG Milford Realty 80 Wampus Lane, Milford
  168,000 sf.
• First Highlands Lamberton Road, Windsor
  reportedly under contract

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Benerofe - Wallingford
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And Vacant.

• Griffin Land 61 Chapel Road, Manchester
  307,000 sf.
• SI Realty - 1690 New Britain Avenue, Farmington
  160,000 sf.
• Blackhammer LLC - 283 Main Street, New Hartford
  220,000 sf.
• New Boston 777 Brook Street, Rocky Hill
  100,000 sf.

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Griffin Land - Manchester
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Land Sales Continue

• Walgreens purchases 130 acres at 100,000 per
  acre
• Out of state developer reported to be u/c in
  Rocky Hill
• Out of State company u/c in S Windsor on 105
  acres

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Speculative Development Continues

• Griffin Land continues Rainbow Road development.
• Out of state developer to develop Rocky Hill
  land.
• DeMattia Companies developing 200,000 sf in
  Bloomfield

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Speculative Development Continues (con).

• 1070 North Farms LLC breaking ground on 42,000 sf
  (Bldg II) in Wallingford.
• Rumor of up to 500,000 sf of spec development
  considered in Suffield.

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Design Build Construction Continues.

• Walgreens breaks ground on 800,000 sf in Windsor.
• DataMail completes 100,000 sf facility in
  Windsor.
• IP/xpedx breaks ground on 85,000 sf on Middle
  Street, Middletown.
• Siracusa Moving Storage nearly completed on
  50,000 sf in New Britain.

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Where are we going tomorrow?

• The Great Crystal Ball

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Corporate Product Continues to Come to Market

• Lego Systems - Over 1.0 mill sf available in
  Enfield.
• Winchester Arms - 225,000 sf in New Haven.
• Franklin Farms 370,00 sf in Pomfret.
• Hitchcock Chair 110,000 sf in New Hartford.

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However, Existing Space to Be Absorbed

• 75 Aircraft Road, Southingtonrumored to be
  pending lease.
• 250,000 sf tenant nearing terms in Hartford
  market.
• CERC courting 120,000-200,000 sf freezer/cooler
  prospect.
• PA based distributor looking for 200,000 sf of
  warehouse space.

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Low Bay Space

• Continues to be ugly step child of high bay,
  BUT
• Depth of market
• Lack of Inventory
• Increase in manufacturing/assembly
• MAKES IT LEASABLE!!! At a Price!!

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Speculative Construction Continues to be Absorbed

• Griffin LandFed Ex, AAR, AW Hastings etc. etc.

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Albeit, Possibly at Less than Pro Forma

• Over 500,000 sf being built in northern
  marketLook out for Price Wars.
• Cost of Construction for TIs putting downward
  pressure on net lease rate.

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Sale Prices May Have Peaked

• User Deals Yes.
• Cost of Construction, although high is somewhat
  stable.
• Medium sized sales still challenged.
• Small buildings still slam dunks!
• Investment Deals
• Probably still a little room left on the upside.
  Lots of investors chasing little product.

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Land Prices Continue to Rise

• Even (and maybe especially) large tracks.
• Small parcel salesStill attractive.

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THANK YOU

• Mark J. Duclos
• Sentry Commercial
• 860 983 5630