An in-depth look at the Cincinnati industrial market. Analysis includes leasing, sales, construction and employment.

1. JLL Research
Cincinnati | Q1 2017
Industrial
Outlook
JLL Research
An in-depth look at the
Cincinnati industrial market.
Analysis includes leasing,
sales, construction and
employment.

2. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
2013 2014 2015 2016 YTD 2017
Average asking rents ($/s.f.)
Q1 2017
Insight
The Cincinnati industrial market has been in rapid expansion mode since
2012. This growth has left many in the industry questioning whether or not the
market has reached its peak or if it is in the “9th inning” of the cycle. The first
quarter answered those questions as the market saw historic quarterly
absorption in addition to the largest announcement made in the market’s
history with Amazon’s air cargo hub. Positive absorption in the quarter was
driven by full building users leasing or purchasing the few quality available
blocks of space in the already tight market.
The signed deals spanned multiple submarkets from Northern Kentucky to
Monroe, displaying the strength of the overall market. Hayneedle leased IDI
Gazeley’s 994,000-square-foot building at Park North in Monroe, while Kroger
purchased Van Trust’s 674,000-square-foot speculative building on Mt. Zion
Road. Following the air cargo announcement, Amazon renewed its lease in
Litton Lane 2 and leased Litton Lane 1 from Duke Realty, totaling 1.4 million
square feet. Multiple full building users remain in the market leading
developers to move forward on development sites to answer the demand.
Outlook
The Cincinnati market has found success through its strategic location to 60
percent of the U.S. population within 500 miles as well as its proximity to
distribution hubs throughout the Midwest. The introduction of Amazon’s 3.0-
million-square-foot, $1.5 billion air cargo hub is another feather in the
market’s cap and one that will have an immediate and lasting impact on the
market as a whole. As demand in the market strengthens, developers will
battle a tightening supply of available land and will look to outlying
submarkets for development sites.
Fundamentals Forecast
YTD net absorption 2,625,368 s.f. ▲
Under construction 2,848,268 s.f. ▲
Total vacancy 3.2% ▼
Average asking rent (gross) $4.13 p.s.f. ▲
Concessions Falling ▼
0
2,000,000
4,000,000
6,000,000
2013 2014 2015 2016 YTD
2017
Supply and demand (s.f.) Net absorption
Deliveries
Industrial market kicks off 2017 with quarter for the ages
6.4%
5.3%
4.4% 4.2%
3.2%
2013 2014 2015 2016 2017
Total vacancy
• Northern Kentucky landed its biggest win to date with Amazon’s
investment of $1.5 billion for an Amazon Prime Air hub at CVG.
• Multiple full-building users leased or purchased newly constructed
properties in the first quarter, leaving only one newly delivered space
over 500,000 square feet available.
• Developers are scrambling to break ground on greenfield sites in the
furthermost southern and northern submarkets to meet demand for
large quality blocks of space.
Cincinnati Industrial Outlook

3. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
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.)
Market Totals
Warehouse & Distribution 167,184,152 1,608,353 1,608,353 1.0% 3.2% 5.3% $3.80 678,224 678,224 2,780,484
Manufacturing 69,026,741 13,732 13,732 0.0% 2.1% 3.1% $2.84 0 0 0
Total Industrial 236,210,893 1,622,085 1,622,085 0.7% 2.9% 4.7% $3.61 678,224 678,224 2,780,484
Flex / R&D 11,932,167 -30,524 -32,917 -0.3% 10.7% 14.2% $6.65 0 0 0
Submarkets
Airport
Warehouse & Distribution 26,325,443 632,843 632,843 2.4% 1.6% 5.5% $4.19 0 0 1,062,658
Manufacturing 2,147,532 -56,000 -56,000 -2.6% 2.6% 2.6% $5.25 0 0 0
Total Industrial 28,472,975 576,843 576,843 2.0% 1.7% 5.3% $4.24 0 0 1,062,658
Flex / R&D 1,069,751 -3,116 -3,116 -0.3% 4.1% 13.3% $5.08 0 0 0
Blue Ash
Warehouse & Distribution 8,627,252 -16,876 -16,876 -0.2% 8.0% 9.6% $4.17 534,560 534,560 0
Manufacturing 2,524,938 0 0 0.0% 0.0% 3.9% $3.00 0 0 0
Total Industrial 11,152,190 -16,876 -16,876 -0.2% 6.2% 8.3% $4.04 534,560 534,560 0
Flex / R&D 1,719,749 -16,409 -16,409 -1.0% 7.0% 9.6% $6.81 0 0 0
Campbell County
Warehouse & Distribution 2,235,913 0 0 0.0% 2.8% 2.9% $5.99 0 0 0
Manufacturing 1,045,402 0 0 0.0% 0.0% 0.0% - 0 0 0
Total Industrial 3,281,315 0 0 0.0% 1.9% 2.0% $5.99 0 0 0
Flex / R&D 567,895 -4,988 -7,381 -1.3% 0.0% 0.0% - 0 0 0
Central / Midtown
Warehouse & Distribution 29,656,818 12,712 12,712 0.0% 2.6% 4.1% $3.97 0 0 173,262
Manufacturing 15,040,484 -37,665 -37,665 -0.3% 1.7% 2.7% $2.75 0 0 0
Total Industrial 44,697,302 -24,953 -24,953 -0.1% 2.3% 3.7% $3.66 0 0 173,262
Flex / R&D 824,506 46,258 46,258 5.6% 30.4% 31.2% $8.72 0 0 0
Covington
Warehouse & Distribution 3,176,777 23,000 23,000 0.7% 1.9% 1.9% $4.16 0 0 0
Manufacturing 779,862 0 0 0.0% 0.0% 0.0% - 0 0 0
Total Industrial 3,956,639 23,000 23,000 0.6% 1.5% 1.5% $4.16 0 0 0
Flex / R&D 20,000 0 0 0.0% 0.0% 0.0% $5.25 0 0 0
East
Warehouse & Distribution 5,660,129 -75,880 -75,880 -1.3% 2.3% 2.3% $3.96 0 0 0
Manufacturing 5,487,999 0 0 0.0% 12.3% 16.6% $2.50 0 0 0
Total Industrial 11,148,128 -75,880 -75,880 -0.7% 7.2% 9.4% $2.71 0 0 0
Flex / R&D 1,188,181 -6,000 -6,000 -0.5% 15.9% 19.7% $7.24 0 0 0
Florence / Richwood
Warehouse & Distribution 12,237,632 949,500 949,500 7.8% 2.0% 4.3% $3.51 0 0 0
Manufacturing 8,214,941 -9,200 -9,200 -0.1% 1.0% 1.4% $3.65 0 0 0
Total Industrial 20,452,573 940,300 940,300 4.6% 1.6% 3.2% $3.54 0 0 0
Flex / R&D 795,699 -4,925 -4,925 -0.6% 6.5% 12.2% $4.92 0 0 0
Q1 2017
Statistics
Cincinnati Industrial Outlook

4. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
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.)
Submarkets (continued)
Hamilton
Warehouse & Distribution 6,209,488 0 0 0.0% 11.8% 12.0% $2.81 0 0 788,564
Manufacturing 1,741,094 0 0 0.0% 7.4% 7.4% $2.25 0 0 0
Total Industrial 7,950,582 0 0 0.0% 10.8% 11.0% $2.73 0 0 788,564
Flex / R&D 200,200 0 0 0.0% 0.7% 0.7% $6.60 0 0 0
I-71 Corridor
Warehouse & Distribution 4,785,348 -1,400 -1,400 0.0% 1.6% 2.1% $4.23 0 0 0
Manufacturing 4,695,416 116,597 116,597 2.5% 3.5% 3.5% $2.75 0 0 0
Total Industrial 9,480,764 115,197 115,197 1.2% 2.5% 2.8% $3.31 0 0 0
Flex / R&D 518,639 0 0 0.0% 17.6% 17.9% $7.25 0 0 0
Monroe / Middletown
Warehouse & Distribution 10,475,292 48,120 48,120 0.5% 3.6% 6.3% $3.75 143,664 143,664 756,000
Manufacturing 6,976,617 0 0 0.0% 1.2% 1.2% $2.25 0 0 0
Total Industrial 17,451,909 48,120 48,120 0.3% 2.6% 4.3% $3.59 143,664 143,664 756,000
Flex / R&D 46,900 0 0 0.0% 0.0% 0.0% - 0 0 0
Tri-County
Warehouse & Distribution 45,864,137 30,640 30,640 0.1% 3.0% 5.1% $3.78 0 0 0
Manufacturing 9,107,941 0 0 0.0% 0.0% 1.7% $4.11 0 0 0
Total Industrial 54,972,078 30,640 30,640 0.1% 2.5% 4.5% $3.80 0 0 0
Flex / R&D 4,087,159 -55,064 -55,064 -1.3% 11.0% 14.7% $6.29 0 0 0
West
Warehouse & Distribution 4,151,072 -21,976 -21,976 -0.5% 5.0% 6.3% $3.85 0 0 0
Manufacturing 708,242 0 0 0.0% 0.0% 0.0% - 0 0 0
Totals 4,859,314 -21,976 -21,976 -0.5% 4.2% 5.4% $3.85 0 0 0
Flex/R&D 313,780 1,200 1,200 0.4% 14.0% 14.0% $6.91 0 0 0
Woodlawn / Evendale
Warehouse & Distribution 7,778,851 27,670 27,670 0.4% 2.0% 6.2% $3.33 0 0 0
Manufacturing 10,556,273 0 0 0.0% 0.0% 0.0% - 0 0 0
Totals 18,335,124 27,670 27,670 0.2% 0.8% 2.6% $3.33 0 0 0
Flex/R&D 579,708 12,520 12,520 2.2% 6.5% 9.7% $4.65 0 0 0
Q1 2017
Statistics
Cincinnati Industrial Outlook

5. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Q1 2017
Construction
Cincinnati Industrial Outlook
Address: Union Centre Blvd &
Seward Rd.
Square feet: 477,360
Tenant: TBD
Owner: Northpoint
Building type: Warehouse
Construction type: Speculative
Est. completion: Q2 2017
Address: 251-299 Exploration Dr.
Square feet: 756,000
Tenant: TBD
Owner: IDI Gazeley
Building type: Warehouse
Construction type: Speculative
Est. completion: Q4 2017
Address: Litton Ln.
Square feet: 589,193
Tenant: TBD
Owner: Hillwood
Building type: Warehouse
Construction type: Speculative
Est. completion: Q2 2017
Est. completion: Q2 2017
Address: 3501 Pt. Pleasant Rd.
Square feet: 264,000
Tenant: TBD
Owner: Dermody
Building type: Warehouse
Construction type: Speculative
Completed: Q1 2017
Address: 675 Gateway Blvd.
Square feet: 143,664
Tenant: TBD
Owner: IDI Gazeley
Building type: Warehouse
Construction type: Speculative

6. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Q1 2017
Sales
Cincinnati Office Outlook
This report analyzes all industrial sales > 30,000 s.f.
$176,615,423
28
$68
-
70.5%
14.6%
5.75-6% 0 - $6,726,547
7.5-8% 0.0% 28 $128,933,142
Top 10 sales transactions this quarter
Size (s.f.) $ p.s.f. Sale date
605,586 $49 Jan-17
296,950 $71 Jun-16
345,600 $59 Dec-16
189,040 $80 Jun-16
325,350 $45 Mar-16
502,041 $25 Jan-17
72,000 $95 Jan-17
98,724 $58 Jan-17
245,154 $23 Feb-16
85,564 $57 Feb-16
Sales activity by building type
Transactions details
Number of partial interest
transactions
Top sellers (s.f.)Top buyers (s.f.)
Number of domestic
buyers
Foreign capital $
Average partial interest
acquired
Number of foreign buyers
Domestic Capital $
Average Class A price p.s.f. YTD
At a glance
Total volume YTD
Number of transactions YTD
Average Class A cap rate YTD
Sales volume $ by submarket
Warehouse/Dist. sales volume as
% of total YTD
Flex/R&D sales volume as % of
total YTD
Cap rate range
Core Class A Ind.
Core Class A Flex
20 Logistics Blvd. Gramercy Property Trust US Industrial REIT III Gateway $29,950,000
Building address Buyer company Seller company Sales price $
8611 Union Centre Blvd Procter & Gamble
5549-5585 Spellmire Dr Dalfen America Corp
8256 Union Centre Blvd Procter & Gamble
8779 Le Saint Dr Gramercy Property Trust
Cabot II OH2MO1 MO4 LLC $12,228,811
10100 Progress Way J.J. & WV Ltd. I-74 Business Group, LLC $6,855,000
4321-4649 Interstate Dr G& IX Interstate I LLC
1032 Seabrook Way MSI Properties LLC Charles J Kubicki LLC $4,898,880
3765 Port Union Rd Performance Food Group Inc Kite Holdings Ltd. $5,756,000
50 W Techne Center Dr CWCapital Asset Management Milford Park Tech Center LLC $5,666,666
Prologis
US Industrial REIT III Gateway
Prologis
Hackman Capital
$21,008,089
$20,230,000
$15,191,911
$14,674,394
$90,594,031 $53,792,192 $32,229,200
2,699,588 s.f.
1,208,615 s.f. 1,276,721 s.f.
0 s.f.
500,000 s.f.
1,000,000 s.f.
1,500,000 s.f.
2,000,000 s.f.
2,500,000 s.f.
3,000,000 s.f.
$0
$50,000,000
$100,000,000
Warehouse / Distribution Manufacturing Flex/R&D
Sum of Price ($) Sum of RBA (SF)
35%
18%12%
10%
9%
6%
5%
Other Gramercy Property Trust
G & I IX Interstate LLC G& IX Interstate I LLC
Proctor & Gamble Dalfen America Corp
CWCapital Asset Management Performance Food Group Inc
MSI Properties LLC J.J. & WV Ltd.
34%
22%
18%
9%
6%
5%
Other Cabot II OH2M01 M04 LLC
US Industrial REIT III Gateway Prologis
Hackman Capital Milford Park Tech Center LLC
Kite Holdings Ltd Charles J Kubicki LLC
I-74Business Group, LLC
$73,639,522
$33,000,000
$21,797,624
$10,565,546
$8,745,547
$6,855,000
$6,779,000
$5,756,000
$4,649,105
$1,728,079
Tri-County
Florence/Richwood
Tri County
East
Blue Ash
West
Woodlawn/Evend…
Fairfield
Central/Midtown
Airport

7. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
20%
16%
15%12%
11%
10%
7%
Trade, Transportation & Utilities
Professional & Business Services
Educational & Health Services
Government
Manufacturing
Leisure & Hospitality
Financial Activities
Mining, Logging & Construction
Other Services
Information
Q1 2017
Employment
Cincinnati Industrial Outlook
4.7%U.S. unemployment
1.5%U.S. 12-month job growth
5.0%Cincinnati unemployment
1.9%Cincinnati12-month job growth
5.0%Ohio unemployment
0.8%Ohio 12-month job growth
0.0%
0.7%
1.4%
2.1%
2.8%
2013 2014 2015 2016 2017
Cincinnati U.S.
-600
-500
200
300
1,400
2,200
2,700
3,000
4,600
6,300
-2,000 -1,000 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000
Leisure & Hospitality
Government
Information
Other Services
Professional & Business Services
Educational & Health Services
Manufacturing
Mining, Logging & Construction
Financial Activities
Trade, Transportation & Utilities
-5.0
0.0
5.0
10.0
2013 2014 2015 2016 2017
Professional & Business Services Information
Government Financial Activities
0%
5%
10%
900,000
1,025,000
1,150,000
2013 2014 2015 2016 2017
Employment Unemployment
Employment vs. unemployment rate
Employment by industry Office employment trends (12-month change, 000s)
Job growth by sector (12-month change)
Job growth (12-month change)
Job growth by sector (12-month change)

8. © 2017 Jones Lang LaSalle IP, Inc.
All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Andrew Batson
Vice President, Director of Research
+1 216 937 4374
andrew.batson@am.jll.com
Abby Armbruster
Research Analyst
+1 513 252 2148
abby.armbruster@am.jll.com
About JLL
JLL (NYSE: JLL) is a leading professional services firm that
specializes in real estate and investment management. A
Fortune 500 company, JLL helps real estate owners,
occupiers and investors achieve their business ambitions.
In 2016, JLL had revenue of $6.8 billion and fee revenue of
$5.8 billion and, on behalf of clients, managed 4.4 billion
square feet, or 409 million square meters, and completed
sales acquisitions and finance transactions of
approximately $136 billion. At year-end 2016, JLL had
nearly 300 corporate offices, operations in over 80
countries and a global workforce of more than 77,000. As
of December 31, 2016, LaSalle Investment Management
has $60.1 billion of real estate under asset management.
JLL is the brand name, and a registered trademark, of
Jones Lang LaSalle Incorporated. For further information,
visit www.jll.com.
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