Charleston Commercial Market Forecast | Derek Mathis Update

Commercial market update at the Charleston Realtors Commercial Market Forecast from Derek Mathis

1. www.CharlestonCommercialMarketForecast.com Derek Mathis Senior Vice President

2. WHY CHARLESTON? Perspectives on Industrial Development and Investment in the Tri-County Area

3. TOPICS Why SunCap investing here Opportunities Threats

4. North Pointe Building One

5. FedEx Ground Distribution Center

6. Palmetto Trade Center

7. Ingleside Commerce

8. THE SECRET IS OUT Developers and capital streaming in from all over the map

9. XYBEC – CALIFORNIA

10. SILVERMAN GROUP – NEW JERSEY

11. CLARIUS – CHICAGO

12. EXETER - PENNSYLVANIA

13. WHY? Yield Growth Economic drivers Diversity of tenant base Ability to attract labor Pro-business attitude

14. World is yield starved and RE is still the best hedge against inflation Industrial and multifamily are still the darlings of CRE Development in most core markets is stretching to get to 50 bps in spread Shift to secondary/tertiary markets. Capital will follow. YIELD

15. People follow jobs (or vice versa). Development follows people. Where is job growth predicted over next 3 years?  Recession/slowdown   Huge equity demand for leased industrial product, especially in port cities GROWTH

16. Advanced Manufacturing Port proximate users E-commerce OPPORTUNITIES

17. STORMS ON THE HORIZON?

18. THREATS Infrastructure Labor Lack of affordable housing Construction costs Complexity of development processes

19. Spartanburg County Project Schedule – Large Industrial (Typical 250,000sf Industrial Facility) Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Surveying/Due Diligence Mass Grading Design (on Lidar) Submit for Land Disturbance Permit Review County LDP Review SCDHEC LDP Review Initiate Site Grading Prepare Final Site Construction Documents Submit to Agencies Agency Review Permit Issuance Initiate Site Construction Charleston County Project Schedule – Large Industrial (Typical 250,000sf Industrial Facility) Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Survey/Due Diligence Finalize Site Plan Site Plan Review Process & Preparation of Construction Documents Permit Review by Various Agencies Permit Issuance Initiate Site Construction *Charts represent local County and SCDHEC processes only. Charts do not account for rezonings, variances, wetland permitting, off-site improvements or other extraneous items that may be required.

20. Berkeley County Project Schedule – Large Industrial (Typical 250,000sf Industrial Facility) Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Surveying/Due Diligence Early Site Package Submit Early Site Package County/SCDHEC Review of ESP Initiate Site Grading Prepare Final Site Construction Documents Submit to Agencies Agency Review Permit Issuance Initiate Site Construction *Charts represent local County and SCDHEC processes only. Charts do not account for rezonings, variances, wetland permitting, off-site improvements or other extraneous items that may be required. Spartanburg County Project Schedule – Large Industrial (Typical 250,000sf Industrial Facility) Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Surveying/Due Diligence Mass Grading Design (on Lidar) Submit for Land Disturbance Permit Review County LDP Review SCDHEC LDP Review Initiate Site Grading Prepare Final Site Construction Documents Submit to Agencies Agency Review Permit Issuance Initiate Site Construction

21. THREATS Anti-growth sentiment

22. “Charleston is one of the best built, handsomest, and most agreeable cities that I have ever seen.”