2009 Kootenai County Market Forum Retail Slides

Retail Dani Kramer, CCIM

Local Unemployment Statistics Kootenai County vs. State of Idaho Unemployment Rate 8.0

Unem mploymeent Ratee

7.0 6.0 5.0 Kootenai County  Unemployment

4.0 3.0

State of Idaho  p y Unemployment

2.0 1.0 0.0

Year

Source: Idaho Commerce & Labor

Pre-2008 Market Conditions Class A Buildings

Class B Buildings

Class C Buildings

•Prime locations •Slightly older buildings •Functionally obsolescent •Newer buildings •Good locations •Older neighborhoods •$16 - $24 per SF NNN •$11 - $15 per SF NNN •$6 - $10 per SF NNN

•All rates quoted annually •NNN = Tenant’s ppro-rata share of common area maintenance,, property taxes, insurance, and other operating expenses

Local Retail – Landlord’s Struggle Landlords start with asking rental rates

Solid Tenant = Negotiation on terms and rent with Tenant

Current Retail Market – Riverstone Master Plan Retail eta Leasing eas g Rates ates $22 - $24 per SF NNN

Current Retail Market – Riverstone Aerial

Pl Planned d Site Sit for f Peak P k

Current Retail Market - Vacancies

Ironwood Square $12.00 per SF NNN $15 per SF NNN

Neider N i & 95 $15 per SF NNN Sportsman Plaza I & II $23 - $25 per SF NNN

Current Retail Market

Ironwood Square $12.00 per SF NNN

Neider N i & 95 $15 per SF NNN

Sportsman’ss Warehouse Sportsman

Current Retail Market – New Retail CdA NEC of Best & 4th Street •$18 $ -$ $24 per p SF NNN

Mountain ou ta View V ew Plaza a a •NWC of Hwy 95 & Neider •$9 - $15 per SF NNN

Current Retail Market – New Retail Hayden Rustlers Roost NWC of Hwy 95 & •NWC Hayden Ave 2.5 acres sold to a national medical user Discount Tire

Planned

2008 Vacancy Report – Kootenai Retail 5.83%

Net Ussable SF F

2,500,000

12.48%

Vacancy Rates

2,000,000

1,500,000 , , Vacant SF Net Usable SF

6.03%

1,000,000

10.66% 500,000

0 Post Falls Retail

Hayden Retail

Rathdrum Retail

Coeur d'Alene Retail

Source: Auble, Jolicoeur & Gentry/Coldwell Banker Commercial

2008 Vacancy Report – Kootenai Retail

Parkwood Business Properties • 2008 Retail Vacancy – 1.3%

2008 Vacancy Report – Kootenai Retail General Growth Properties Inc. (GGP)

Current Retail Market – Post Falls

Current Retail Market – Post Falls Coeur d’Alene, ID

I-90 Pleasantview Rd. Interchange (46,000+ CPD 2006) EXPO Retail/Commercial/Industrial/Multi-Family R t il/C i l/I d t i l/M lti F il

Sysco

Future Beck Rd. Interchange 2010 Estimated Completion

Planned Wal-Mart Superstore Pl Planned d Lowe’s L ’ Idaho-Washington Border

Stateline I-90 Interchange

Current Retail Market – Post Falls Mullan Avenue Highway 41 Highland Crossing

Planned

River City Center

Looking Forward to 2009 - Retail Market • Landlords and Tenants need to keep an open dialogue • Expect stable/increased vacancies • Downward D d pressure on rents t • Increased pressure on rent concessions

Looking Forward to 2009 - Retail Market “With Adversity Comes Opportunity” • Landlord Opportunities • Purchase distressed properties • Purchase retail projects at favorable cap rates • Acquire tenants looking to downsize or relocate to a better location • Tenant Opportunities pp • Lock-in a lower lease rate for several years at a better location • Renegotiate R ti t upcoming i option ti extensions t i