OCCUPIER GUIDE

Total Stock (million sq. ft.)
314.6

Vacancy Rate
5.7%

Availability Rate
7.6%

NNN Lease Rate
$7.56

Net Absorption (million sq. ft.)
4.0

Metro Area Population
4.7 million

Unemployment Rate
4.3%

Annual Salary - Warehouse
28,018

% of Pop - Secondary Education
53.0%

% of Pop - Tertiary Education
47.0%

Airport
Sky Harbor International Airport

Total Cargo (millions of U.S. tons)
0.02

Seaport
N/A

TEU Volume - 2017 (millions)
N/A

Major Highways
I-10 and I-17

Number of Intermodal Rail Hubs
1

Number of Class I Rail Lines
2

What is the term of a typical lease?
3 -5 years

How is the rent quoted?
NNN Monthly

What is the tenant's option for termination or break?
Negotiable, but not typically a concession that landlords offer.

Does the tenant have the option to renew? What is the length of the typical option?
Yes. Typically, 5-year renewal option at prevailing fair market rental rate.

How is the rent determined at renewal?
Based upon fair market value.

What is the typical rent-free period, if any?
1 month on 3-year lease and 3 months on 5-year lease.

What is the typical rent escalation?
3% annual increases.

Does the tenant have the right to sublet?
Typically,yes to a related subsidiary company or with landlord's prior written approval.

What is the unit of measurement of a typical lease?
Per sq.ft. per month

Does the leasable area include the common area?
No

What is the average rent for a warehouse greater than 50K sq. ft.?
$0.38 NNN per sq. ft. per month

What is the average rent for a manufacturing facility greater than 50K sq. ft.?
$0.42 NNN per sq. ft. per month

Is there a rent review during the lease? 
No

What are the average service charges (OPEX)? 
$0.12 to $0.13 per sq. ft. per month

Who is responsible for the service charges?
Tenant

What are the average taxes paid on the lease?
$0.08 to $0.09 per sq. ft. per month

Who is responsible for the property taxes?
Tenant

Who is responsible for the utilities?
Tenant

Who is responsible for the fit-out costs, if any?
Landlord

What is the typical security deposit?
Based on credit and length of term but typically last month's rent amount.

How is car/truck parking paid?
Usually included unless a tenant requires more than average.

Any other occupancy costs?
N/A

What are typical agency fees? Who pays them?
3% to listing team (usually 5% to procuring broker)

Who is responsible for legal fees?
Each party is responsible for their own legal fees

Any other transaction costs?
Rental Tax (Privilege Tax) -about 2.90%-3.00% based upon municipality

What is the typical land tenure?
5 -7 years

What is the terminology of the purchase agreement?
Purchase & Sale Agreement

What is the average cost?
Warehouse/Distribution: 400K sq.ft.+: $30-$32per sq.ft.; 100K-300K sq.ft.: $35per sq.ft.
Manufacturing: 400K sq.ft.+: $36-$38per sq.ft.; 100K-300K sq.ft.: $39persq.ft.

What is the agency fee and who pays?
3% to the listing team, paid by landlord

What is the typical LTV?
70% / 30%

What is the average borrowing rate?
4.50% -4.75%

What is the mode of payment?
Upon closing

What are the average transaction (closing) costs?
1% to 2% plus attorney and title fees

What is the average clear ceiling height?
30' -36'

Average number of dock doors?
70 –150

Typical column spacing?
56' x 50'

Average parking ratio?
1.5 to 2.0 / 1,000 sq. ft.

Sprinkler system?
ESFR

What is the typical power supply?
2,000 to 3,000 amps 277/480 volts 3 phase