Foreign Investment in US/Canada Apartments

April 2014

1

0%

5%

10%

15%

20%

25%

30%M

ar-

78

Mar-

80

Mar-

82

Mar-

84

Mar-

86

Mar-

88

Mar-

90

Mar-

92

Mar-

94

Mar-

96

Mar-

98

Mar-

00

Mar-

02

Mar-

04

Mar-

06

Mar-

08

Mar-

10

Mar-

12

Ap

art

me

nt %

of N

PI

Source: NCREIF, LaSalle Investment Management As of 4Q2013

US Apartment Share of NPI Has Risen Significantly Since 1990s

2

Canada: Apartments Only 7% of IPD Index Capital ValueREALpac / IPD Canada Quarterly Property Index, Q1/00 – Q4/13

Source: IPD, LaSalle Investment Management At

Q4 2013

0%

1%

2%

3%

4%

5%

6%

7%

8%

Q4 2

013

Q2

20

13

Q4

20

12

Q2

20

12

Q4

20

11

Q2

20

11

Q4

20

10

Q2

20

10

Q4

20

09

Q2

20

09

Q4

20

08

Q2

20

08

Q4

20

07

Q2

20

07

Q4

20

06

Q2

20

06

Q4

20

05

Q2

20

05

Q4

20

04

Q2

20

04

Q4 2

003

Q2 2

003

Q4

20

02

Q2

20

02

Q4

20

01

Q2

20

01

Q4

20

00

Q2

20

00

% o

f IP

D C

apital V

alu

e

Q4/13 IPD Index Capital Value: $117.6 bln

Apartments: $8.6 bln

3

10%

15%

20%

25%

30%

35%

40%

45%

50%M

ar-

78

Ma

r-8

0

Ma

r-8

2

Ma

r-8

4

Ma

r-8

6

Ma

r-8

8

Ma

r-9

0

Ma

r-9

2

Ma

r-9

4

Ma

r-9

6

Ma

r-9

8

Mar-

00

Ma

r-0

2

Ma

r-0

4

Ma

r-0

6

Ma

r-0

8

Ma

r-1

0

Ma

r-1

2

Se

cto

r %

of N

PI

Industrial Office Retail

Source: NCREIF, LaSalle Investment Management As of 4Q2013

US Industrial, Office Sectors Losing Share Since Early 2000s

4

0%

2%

4%

6%

8%

10%

12%

5-Year 10-Year 15-Year

An

nu

aliz

ed

To

tal R

etu

rn

All Propeties Apartment Industrial Office Retail

US Apartment Returns Above Average for Most Periods

4

Source: NCREIF, LaSalle Investment Management As of 4Q2013

5

0%

2%

4%

6%

8%

10%

12%

14%

5-Year 10-Year 14-Year

An

nu

aliz

ed

To

tal R

etu

rn

All Propeties Apartment Industrial Office Retail

Canada: Apartment Returns Lag but Are Less Volatile

5

Source: IPD, LaSalle Investment Management As of 4Q2013

6

0%

1%

2%

3%

4%

5%

6%

$0

$20

$40

$60

$80

$100

$120

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

% C

ross

Bo

rde

r

Tra

nsacti

on

Vo

lum

e (

$B

il)

Domestic Investors

Cross-Border Investors

% Cross Border

Share of Foreign Investment in US Apartments Has RisenApartment Transaction Volume

6

Note: RCA data understates foreign investment because foreign capital managed by domestic managers is primarily classified as domestic capital

Source: Real Capital Analytics, LaSalle Investment Management As of 4Q2013

7

0%

5%

10%

15%

20%

25%

30%

35%

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

% o

f T

ran

sa

ctio

ns

$ m

illio

ns

Foreign Domestic % Foreign

Canada: Foreign Investors’ Share of Apartment Market Relatively

Small

7

Source: CBRE, LaSalle Investment Management As of 4Q2013

8

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

Cro

ss

Bo

rde

r %

of

Tra

ns

ac

tio

ns

Apartment % Cross BorderOverall % Cross Border

Foreign Investors Prefer Other Property Types to Apartments, USForeign Buyers Buy Relatively More Offices, Hotels, Retail, and Warehouses

8

Note: RCA data understates foreign investment because foreign capital managed by domestic managers is primarily classified as domestic capital

Source: Real Capital Analytics, LaSalle Investment Management As of 4Q2013

Property Type

Cross Border Investment as

% of 2013 Transaction

Volume

Office 14.6%

Hotel 9.2%

Retail 7.8%

Industrial 5.6%

Apartment 4.6%

9

0

500

1000

1500

2000

2500

3000

3500

4000

Tra

nsa

ctio

n V

ou

me

($M

M) 2013

5-Year Average

Most Foreign Investment In Apartments Is from Canada

9

Note: RCA data understates foreign investment because foreign capital managed by domestic managers is primarily classified as domestic capital

Source: Real Capital Analytics, LaSalle Investment Management As of 4Q2013

10

0%

5%

10%

15%

20%

25%

30%M

ar-

78

Ma

r-8

0

Ma

r-8

2

Ma

r-8

4

Ma

r-8

6

Ma

r-8

8

Ma

r-9

0

Ma

r-9

2

Ma

r-9

4

Ma

r-9

6

Ma

r-9

8

Mar-

00

Ma

r-0

2

Ma

r-0

4

Ma

r-0

6

Ma

r-0

8

Ma

r-1

0

Ma

r-1

2

Ap

art

me

nt %

of N

PI

Garden

High Rise

Low Rise

Garden, High & Low Rise

High & Low Rise

All Apartments

Source: NCREIF, LaSalle Investment Management As of 4Q2013

US Increase Since 2000 is Mostly From High-Rise Apartments

11

US: Top 10 Foreign Apartment Purchases in 2013

11

Buyer Property Location UnitsPrice

(USD, mil.)

Brookfield (Canada) Southeast Portfolio Carolinas, VA, TX 3,115 $231.7

Land & Houses (Thailand) Domain Oakland, CA 264 $104.0

Grosvenor (UK) Northcreek Seattle, WA 524 $88.0

UBS (Switz.) Mission Grove Park Riverside, CA 432 $75.4

BVT (Germany)Estates at Southpark

MeadowsAustin, TX 670 $65.0

Morguard REIT (Canada) Grand Venetian Dallas, TX 514 $63.2

Milestone REIT (Canada) Nashboro Village Nashville, TN 994 $60.6

Morguard REIT (Canada) Portfolio Louisiana 588 $60.0

Investcorp (Bahrain) University Estates Austin, TX 498 $58.9

Morguard REIT (Canada) Lodge at Crossroads Raleigh, NC 432 $57.1

Note: RCA data understates foreign investment because foreign capital managed by domestic managers is primarily classified as domestic capital

Source: Real Capital Analytics, LaSalle Investment Management

This information is intended to assist professional investors in deciding whether they wish to consider the investment further. This publication does not constitute an offer to sell, or the

solicitation of an offer to buy, any securities or any interests in investment funds sponsored by, or the advisory services of, LaSalle Investment Management and is subject to

correction, completion and amendment without notice. Any such offer, if made, will only be made by means of a confidential prospectus. The prospectus will include information

regarding investment risk and investors should have the financial ability and willingness to accept these risks. All information obtained from third party sources is believed to be reliable

and current, but accuracy cannot be guaranteed and we do not undertake to update any information contained in this document. All assumptions, figures and calculations contained in

the information must be independently verified by the professional investor. This publication has been prepared without regard to the specific investment objectives, financial situation

or particular needs of recipients. No legal or tax advice is provided. Recipients should independently evaluate specific investments and trading strategies. By accepting receipt of this

publication, the recipient acknowledges that this publication is confidential and agrees not to distribute, offer or sell this publication or copies of it and agrees not to make use of the

publication other than for its own general information purposes. Copyright © 2012 LaSalle Investment Management. All rights reserved. No part of this publication may be reproduced

by any means, whether graphically, electronically, mechanically or otherwise howsoever, including without limitation photocopying and recording on magnetic tape, or included in any

information store and/or retrieval system without prior permission of LaSalle Investment Management.

LaSalle Investment Management Research

For more information please contact Bill Maher (410.878.4822)