Lots of great information in our Q2 industrial report. Construction continues to ramp up and some large leases will provide a boost to absorption later this year

1. Industrial Outlook
St. Louis Q2 2016

2. Change in industrial employment (in thousands)
Source: JLL Research, BLS
Number of transactions by size
Source: JLL Research
Construction activity by type (under construction)
Source: JLL Research
Employment rises with occupancy
Industrial employment had year-over-year growth for 37 consecutive months,
mirroring the growth in occupied space over that time. This overall trend should
continue through year-end as tenants continue to take on additional space.
However, not all sectors of industrial employment are growing. Manufacturing
employment has started to slip after 20 months of annual growth. The sector has
slid for past six months. Several companies that are leasing new facilities
include: New Balance, GM, Amazon, and DB Schenker.
Smaller leases headline activity
The headline of the quarter was Amazon leasing two speculative buildings in the
Metro East submarket. The leases total nearly 1.5 million square feet and will
provide a huge boost to absorption when they commence later this year. Beyond
those two transactions, other activity this quarter was under 250,000 square feet.
That size segment was led by DB Schenker’s 214,000-square-foot lease at
Tristar’s third spec building in Gateway Commerce Center. The 523,000-square-
foot building is set for completion this year. Unlike last quarter when most leases
were renewals, new tenants to the market consisted of over half of leasing
activity by square footage.
New development spreading across the region
With almost five million square feet under construction, the market is now set to
deliver over six million square feet in 2016. That will be at or near record levels
achieved in the early 2000’s. Nearly two-thirds of what is under construction is
build-to-suit. Those projects are led by the Schnucks (923,000 square feet) and
GM (1,200,000 square feet) and Reckitt Benckiser (715,000 square feet). The
latter two buildings are located in St. Charles County. The high level of pre-
leasing in those buildings and others will bring absorption around five million
square feet in 2016.
More buildings are on the way
61%
8%
31%
BTS
Owner-user
Speculative
Industrial Insight
St. Louis | Q2 2016
331,670
Quarterly absorption (s.f.)
236,299
Warehouse absorption (s.f.)
2,179,788
Total deliveries YTD
4,734,060
Total under construction (s.f.)
6.6%
Total vacancy
1,480,780
Speculative construction (s.f.)
2.5%
12-month rental rate growth
73.3%
Total preleased
2
-
4
8 8
0
5
10
500,000+ 250,000-
499,999
100,000-
249,999
50,000-
99,999
10,000-
49,999
(10)
0
10
20
2013 2014 2015 2016
Mining, Logging & Construction Trade, Transportation & Utilities
Manufacturing Other Services

3. Industrial Leasing Activity Report
St. Louis
Q2 2016
This report analyzes all closed industrial leases > 30,000 s.f.
21
2,822,749
2,791,249
0
-
39
5,687,018
Avg. building
construction date
586,156
0
155,424
1,744,540
0
31,000
Top 10 lease transactions during the quarter
Size Building status Year built
769,500 Existing 2016
717,250 Existing 2016
214,890 Existing 2016
148,146 Existing 1965
120,000 Planned 1964
116,783 Existing 1997
80,000 Existing 1997
63,354 Existing 1971
62,240 Existing 2016
61,057 Existing 2003
Total s.f. leased QTD:
Warehouse/Distribution
Leasing activity QTD
1994
Total s.f. leased QTD:
Manufacturing
Leasing activity by transaction type QTD
Total s.f. leased QTD:
Special Purpose
Total leases YTD
134,417
Total s.f. leased YTD
At a glance
Total leases QTD
Total s.f. leased QTD
Leasing activity by size QTD
Leasing activity by submarket QTD
Amazon
Tenant Address Submarket
Avg. lease size (in s.f.)
Expansion in market
Expansion in building
Renewal
Extension (< 36-month term)
Relocation within market
New to market
Lease type
3931 Lakeview Corporate Drive Metro East Direct
3049 Gateway Commerce Center
Dr. S.
Metro East
Metro East3050 Gateway Commerce Center Direct
Direct
Sundisc Abrasives USA, LLC 11418-11446 Moog Dr. Mid County Direct
Epsilon Data Management 1 American Eagle Plz. North County
World Wide Technology
Direct
Fisher Rosemount Systems 5505 Natural Bridge St. Louis City Direct
Direct
Re-Sort Solutions 2081-2089 Corporate 44 Dr South County Direct
Perfection Hy-Test Company
306 Hazelwood Logistics Center
Drive
North County Direct
Amazon
11911 Adie Rd Mid County
Schenker, Inc.
DirectMid CountySolar Control Films 1220 N Price Rd
60.3%
14.3%
15.3%
3.7%
6.4%
Metro East
Mid County
North County
South County
St. Louis City
-
0
0
1
1
1
1
Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016
Historical leasing activity
2 - 4 8 8
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
500,000+ 250,000-499,999 100,000-249,999 50,000-99,999 10,000-49,999
Total leased Number of leases
Source: JLL Research 2015 Jones Lang LaSalle IP, Inc. All rights reserved.

4. Industrial Development Report
St Louis
Q2 16
This report analyzes all industrial developments under construction & new deliveries > 30,000 s.f.
Total leased at delivery (%) 48.1%
Total speculative at delivery (s.f.) 2,019,788
Total BTS at delivery (s.f.) 160,000
Total Owner-User at delivery (s.f.) -
Total # of properties delivered 7
Asking rental rate (low - high) $0.00 - $0.00
Top 5 projects delivered to date
Building RBA (s.f.) Delivery date
Leased at
delivery (%)
3931 Lakeview Corporate Drive 769,500 Q2 2016 100%
Gateway East 717 717,000 Q1 2016 0%
Hazelwood Logistics Spec 199,288 Q2 2016 59%
1000 Integram Dr. 160,000 Q1 2016 100%
501 Fountain Lakes Boulevard 138,000 Q2 2016 0%
Total pre-leased (%) 73.3%
Total speculative under construction (s.f.) 1,480,780
Total BTS under construction (s.f.) 2,886,280
Total Owner-user under construction (s.f.) 367,000
Total # of properties UC 8
Asking rental rate (low - high) $0.00 - $0.00
Top 5 projects currently under construction
Building RBA (s.f.) Delivery date Pre-leased (%)
GM Supplier Building 1,200,000 2016 100%
Schnuck's Distribution Center 923,500 2016 100%
2001 Premier Parkway 714,780 Q4 2016 100%
Northpark Distribution Center I 538,000 Q4 2016 0%
Gateway East 520 520,980 Q4 2016 41%
BTS
Speculative
Speculative
Submarket
Under construction
4,734,060
Under construction (s.f.)
Under construction in-depth
Upcoming deliveries by year (s.f., excludes YTD completions)
New deliveries
Completions in-depth
2,179,788
Total delivered YTD (s.f.)
Historical deliveries (s.f.)
Construction typeOwnerSubmarket
St. Charles County
Franklin County
North County
Metro East
Metro East
JB Management
-
Northpoint
Tristar
Panattoni Development
Speculative
Speculative
Metro East
North County
St. Charles County
North County
St. Charles County
Speculative
Speculative
Owner Construction type
BTS
Tristar
Northpark Partners
Duke Realty
Northpark Partners
Northpoint
BTS
BTS
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
2010 2011 2012 2013 2014 2015 YTD 2016
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
2016
BTS Owner-user Speculative
Source: JLL Research 2015 Jones Lang LaSalle IP, Inc. All rights reserved.

5. Industrial Statistics
St. Louis | Q2 2016
Inventory
(s.f.)
Quarterly
total net
absorption
(s.f.)
YTD
total net
absorption
(s.f.)
YTD
total net
absorption
(% of stock)
Total
vacancy
(%)
Total
availability
(%)
Average
total asking
rent
($ p.s.f.)
Quarterly
completions
(s.f.)
YTD
completions
(s.f.)
Under
construction
(s.f.)
St. Louis Total
Warehouse & distribution 150,544,350 236,299 966,646 0.6% 7.5% 12.5% $3.85 1,231,788 2,179,788 4,367,060
Manufacturing 62,068,603 95,371 -12,524 0.0% 3.8% 7.0% $2.94 0 0 367,000
Totals 212,612,953 331,670 954,122 0.4% 6.1% 11.4% $3.68 1,231,788 2,179,788 4,734,060
Submarkets
Metro East
Warehouse & Distribution 25,341,999 -31,839 -232,011 -0.9% 9.0% 6.0% $3.84 769,500 1,486,500 520,980
Manufacturing 9,583,454 30,150 30,150 0.3% 0.9% 2.1% $4.65 0 0 0
Totals 34,925,453 -1,689 -201,861 -0.6% 6.8% 4.9% $3.91 769,500 1,486,500 520,980
St. Louis City
Warehouse & Distribution 39,650,096 -15,200 106,550 0.3% 9.2% 21.1% $2.90 125,000 125,000 0
Manufacturing 18,755,909 -59,779 -59,779 -0.3% 9.0% 14.4% $2.19 0 0 0
Totals 58,406,005 -74,979 46,771 0.1% 9.1% 18.9% $2.59 125,000 125,000 0
Mid County
Warehouse & Distribution 22,359,130 191,316 312,451 1.4% 5.6% 8.5% $3.70 0 0 0
Manufacturing 5,820,995 100,000 124,485 0.1% 2.0% 2.0% $3.97 0 0 0
Totals 28,180,125 291,316 436,936 1.6% 4.4% 7.2% $3.91 0 0 0
South County
Warehouse & Distribution 8,291,415 74,023 92,500 1.1% 4.4% 11.6% $5.57 0 0 0
Manufacturing 4,113,587 -10,000 -153,160 -3.7% 4.7% 14.1% $2.95 0 0 0
Totals 12,405,002 64,023 -60,660 -0.5% 4.5% 12.5% $5.30 0 0 0
West County
Warehouse & Distribution 2,551,795 0 -1,182 0.0% 2.3% 5.1% $3.90 0 0 0
Manufacturing 2,799,134 10,780 10,780 0.4% 0.1% 7.0% $5.25 0 0 0
Totals 5,350,929 10,780 9,598 0.2% 1.1% 6.1% $3.92 0 0 0
North County
Warehouse & Distribution 32,350,529 -50,146 137,854 0.4% 9.8% 15.1% $4.12 199,288 270,288 1,883,300
Manufacturing 8,732,923 0 0 0.0% 0.1% 0.9% $3.10 0 0 367,000
Totals 41,083,452 -50,146 137,854 0.3% 7.7% 12.1% $4.06 199,288 270,288 2,250,300
St. Charles County
Warehouse & Distribution 12,715,911 23,926 246,361 1.9% 2.4% 3.6% $3.91 138,000 138,000 1,962,780
Manufacturing 8,115,858 35,000 35,000 0.4% 0.7% 1.4% $4.41 0 0 0
Totals 20,831,769 58,926 281,361 1.4% 1.7% 2.7% $4.02 138,000 138,000 1,962,780
Other Counties
Warehouse & Distribution 7,158,475 44,219 304,123 4.2% 3.3% 7.2% $2.41 0 160,000 0
Manufacturing 4,146,743 0 0 0.0% 7.8% 9.0% $2.94 0 0 0
Totals 11,305,218 44,219 304,123 2.7% 5.0% 7.9% $2.68 0 160,000 0
211 N Broadway, St. Louis, MO 63102 tel +1 314 261 7377 blaise.tomazic@am.jll.com
2016 Jones Lang LaSalle IP, Inc. All rights reserved.
Blaise Tomazic Research Manager