Find out why Axiometrics calls 2014 the “Year of the Apartment” as VP of Research, Stephanie McCleskey, provides exceptional insight into why the apartment segment of commercial real estate has outperformed everyone’s expectations––and whether the climbing occupancy and effective rent growth will continue. Be the first to see the most recent market research, as well as the highly anticipated forecast for 2015.

1. Apartment Market Predictions: A
Look at 2014 and Beyond

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3. About Axiometrics Inc.
Smart Data. Smart People. Smart Decisions.
Axiometrics empowers clients—investors, operators and developers—to improve apartment
property and portfolio performance, as well as to identify markets, submarkets and specific sites
for apartment acquisitions and development.
Our solutions—built upon monthly, street-level surveys begin with an evaluation of the
performance of a single property and extend to competitive properties, neighborhoods,
metropolitan areas, regions, portfolios and companies.
When coupled with our forecasts, our solutions enable clients to make smarter, timelier
decisions, whether managing existing apartment investments to risk-adjusted returns over a
specific investment horizon, or identifying new markets for investment.
We also provide clients with an objective, relative comparison of their portfolio’s performance to
industry benchmarks, further enabling opportunistic adjustments to their investments.
Axiometrics is the only multifamily research provider to survey every property in its database at
the floor plan level every month

4. Apartment Market Summary and Outlook
AXIOMETRICS INC.
Stephanie McCleskey, Vice President of Research
14901 Quorum Dr., Suite 600
Dallas, TX 75254
www.axiometrics.com
November 2014

5. Presentation Outline
• Demand Drivers for Apartments
• New Supply
• Current National Apartment Market Performance
• Current Apartment Market Performance
• Forecast

6. Between ages 20 and 64 years old,
which group has the largest
• 35-39
• 40-44
• 45-49
• 50-54
• 55-59
• 60-64
• 20-24
• 25-29
• 30-34
population?

7. Between ages 20 and 64 years old,
which group has the largest
• 35-39
• 40-44
• 45-49
• 50-54
• 55-59
• 60-64
• 20-24
• 25-29
• 30-34
population?
Which is most likely to rent an
apartment?

8. U.S. Population by Age Group
In Millions
Prime renter age group has larger population base than other demographics
24
23
22
21
20
19
18
17
Prime renter age group Baby boomers and empty-nesters
20 to 24 years 25 to 29 years 30 to 34 years 35 to 39 years 40 to 44 years 45 to 49 years 50 to 54 years 55 to 59 years 60 to 64 years
Source: Census

9. Age 30 Population as of Census July 2013
Includes Death, Immigration Etc.
Demographics Will Remain in Favor of Multifamily
Source: Census
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014F
2015F
2016F
2017F
2018F
2019F
2020F

10. 60.0%
55.0%
50.0%
45.0%
40.0%
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
1996
1997
1998
1999
2000
2001
2002
2003
57.4%
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
47.5%
1Q14
2014F
2015F
2016F
2017F
2018F
2019F
2020F
HO Rate < 25YO HO Rate 25-29 HO Rate 30-34
50.7%
41.8%
33.3%
36.1%
25.7%
21.5%
24.3%
What if Single-Family Improves?
HO Rate for the age group most likely to rent expected to remain subdued
Source: Axiometrics Inc., Census

11. Change in Renter HH from 2010 to 2013
Significant Renter Demand from Baby Boomers and Empty-Nesters
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
<=34YO Householder 35
to 44 years
Householder 45
to 54 years
Householder 55
to 59 years
Householder 60
to 64 years
Householder 65
to 74 years
Householder 75
to 84 years
Householder 85
years and over
<=34YO Householder 35 to 44 years Householder 45 to 54 years Householder 55 to 59 years
Householder 60 to 64 years Householder 65 to 74 years Householder 75 to 84 years Householder 85 years and over
Source: Census

12. Effective Rent Growth and Job Growth
Historically, job growth has been the best indicator for the strength of rent
growth. At a national level, the two variables are 86% correlated
8.0%
6.0%
4.0%
2.0%
0.0%
-2.0%
-4.0%
-6.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
-2.0%
-4.0%
-6.0%
-8.0%
-10.0%
Dallas, TX
Effective Rent Growth Job Growth
1Q97
3Q97
1Q98
3Q98
1Q99
3Q99
1Q00
3Q00
1Q01
3Q01
1Q02
3Q02
1Q03
3Q03
1Q04
3Q04
1Q05
3Q05
1Q06
3Q06
1Q07
3Q07
1Q08
3Q08
1Q09
3Q09
1Q10
3Q10
1Q11
3Q11
1Q12
3Q12
1Q13
3Q13
1Q14
3Q14
Source: Axiometrics Inc., Census

13. Effective Rent Growth and Job Growth
Historically, job growth has been the best indicator for the strength of rent
growth. At a national level, the two variables are 86% correlated
8.0%
6.0%
4.0%
2.0%
0.0%
-2.0%
-4.0%
-6.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
-2.0%
-4.0%
-6.0%
-8.0%
-10.0%
Dallas, TX
Effective Rent Growth Job Growth
Rent growth outpaced job
growth due to lack of supply
Rent and job growth
are now in balance
as supply delivers to
the market
1Q97
3Q97
1Q98
3Q98
1Q99
3Q99
1Q00
3Q00
1Q01
3Q01
1Q02
3Q02
1Q03
3Q03
1Q04
3Q04
1Q05
3Q05
1Q06
3Q06
1Q07
3Q07
1Q08
3Q08
1Q09
3Q09
1Q10
3Q10
1Q11
3Q11
1Q12
3Q12
1Q13
3Q13
1Q14
3Q14
Source: Axiometrics Inc., Census

14. Job Gain and Job Growth
Current as of September 2014 through forecasted period
MSA
September
Job Gain (000)
September
Job Growth (%)
2015-2020
Forecast (%)
Houston, TX 119.4 4.3% 2.3%
Orlando, FL 39.9 3.7% 2.7%
Dallas, TX 78.0 3.7% 2.4%
Seattle, WA 45.9 3.0% 2.3%
Atlanta, GA 51.9 2.3% 2.2%
Phoenix, AZ 41.2 2.3% 2.7%
New York, NY 104.1 1.9% 1.4%
Los Angeles, CA 73.8 1.8% 1.4%
Boston, MA 45.3 1.8% 1.8%
Chicago, IL 40.1 1.1% 1.4%
National 2,683 2.0% 1.6%
Source: Axiometrics Inc., BLS

15. New supply is being delivered to the
market, but where does it stand
compared to historical levels for
multifamily housing?
Total
Residential Single-family Multifamily

16. New supply is being delivered to the
market, but where does it stand
compared to historical levels for each
Total
housing type?
Residential Single-family Multifamily

17. New supply is being delivered to the
market, but where does it stand
compared to historical levels
Total
multifamily housing?
Residential Single-family Multifamily

18. New supply is being delivered to the
market, but where does it stand
compared to historical levels for
mulitfamily housing housing?
Total
Residential Single-family Multifamily

19. National Residential Units Permitted (1Q10-2Q14)
1,200
1,000
800
600
400
200
-
Total Residential Permits Single-Family Multifamily
Total
Single-Family
Apartments, Condos, Student Housing,
Seniors Housing, Affordable
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14
Source: Axiometrics Inc., Census

20. National Residential Units Permitted (1Q10-2Q14)
Total Residential Permits Single-Family Multifamily
Source: Axiometrics Inc., Census
2,500
2,000
1,500
1,000
500
-
Total
SF
MF
Supply has increased the past
few years, but is still well below
historic levels
2Q96
4Q96
2Q97
4Q97
2Q98
4Q98
2Q99
4Q99
2Q00
4Q00
2Q01
4Q01
2Q02
4Q02
2Q03
4Q03
2Q04
4Q04
2Q05
4Q05
2Q06
4Q06
2Q07
4Q07
2Q08
4Q08
2Q09
4Q09
2Q10
4Q10
2Q11
4Q11
2Q12
4Q12
2Q13
4Q13
2Q14

21. U.S. Apartment New Supply: 5+ Units
Rational behavior assumption: Once occupancy, rent and job growth start to
decelerate, underwriting will be harder, resulting in slower new supply starting
2016
New Supply LTA Supply Inventory Growth
Current level
Source: Axiometrics Inc., Census
2.0%
1.8%
1.6%
1.4%
1.2%
1.0%
0.8%
0.6%
0.4%
0.2%
0.0%
400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
1Q97
3Q97
1Q98
3Q98
1Q99
3Q99
1Q00
3Q00
1Q01
3Q01
1Q02
3Q02
1Q03
3Q03
1Q04
3Q04
1Q05
3Q05
1Q06
3Q06
1Q07
3Q07
1Q08
3Q08
1Q09
3Q09
1Q10
3Q10
1Q11
3Q11
1Q12
3Q12
1Q13
3Q13
1Q14
3Q14
1Q15F
3Q15F
1Q16F
3Q16F
1Q17F
3Q17F
1Q18F
3Q18F
1Q19F
3Q19F
1Q20F
3Q20F

22. New Supply by Market
Deliveries are projected to slow in the next couple years
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
14,000
12,000
10,000
8,000
6,000
4,000
2,000
-
Austin
New Supply Inv Growth
1Q97
1Q98
1Q99
1Q00
1Q01
1Q02
1Q03
1Q04
1Q05
1Q06
1Q07
1Q08
1Q09
1Q10
1Q11
1Q12
1Q13
1Q14
1Q15F
1Q16F
1Q17F
1Q18F
1Q19F
1Q20F
1.4%
1.2%
1.0%
0.8%
0.6%
0.4%
0.2%
0.0%
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
-
Los Angeles
New Supply Inv Growth
1Q97
1Q98
1Q99
1Q00
1Q01
1Q02
1Q03
1Q04
1Q05
1Q06
1Q07
1Q08
1Q09
1Q10
1Q11
1Q12
1Q13
1Q14
1Q15F
1Q16F
1Q17F
1Q18F
1Q19F
1Q20F
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
-
New York
New Supply Inv Growth
1Q97
1Q98
1Q99
1Q00
1Q01
1Q02
1Q03
1Q04
1Q05
1Q06
1Q07
1Q08
1Q09
1Q10
1Q11
1Q12
1Q13
1Q14
1Q15F
1Q16F
1Q17F
1Q18F
1Q19F
1Q20F
2.0%
1.5%
1.0%
0.5%
0.0%
6,000
5,000
4,000
3,000
2,000
1,000
-
San Francisco
New Supply Inv Growth
1Q97
1Q98
1Q99
1Q00
1Q01
1Q02
1Q03
1Q04
1Q05
1Q06
1Q07
1Q08
1Q09
1Q10
1Q11
1Q12
1Q13
1Q14
1Q15F
1Q16F
1Q17F
1Q18F
1Q19F
1Q20F
Source: Axiometrics Inc., Census

23. Which of these years has been the
strongest for your property or
portfolio?
2010 2011 2012 2013 2014

24. National Year-to-Date Rent Growth
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
2010
2010
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.

25. National Year-to-Date Rent Growth
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
2010 2011
2010
2011
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.

26. National Year-to-Date Rent Growth
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
2010 2011 2012
2010
2011
2012
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.

27. National Year-to-Date Rent Growth
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
2010 2011 2012 2013
2010
2011
2012
2013
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.

28. National Year-to-Date Rent Growth
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
The strongest YTD rent growth post recession has been in 2014
2010 2011 2012 2013 2014
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.

29. Year-to-Date Rent Growth by Market
9.0%
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
Atlanta
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
Dallas
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
9.0%
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
-2.0%
New York
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
-2.0%
Denver
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.

30. Performance of Top Ten Major Markets
Northern California markets continue to be a top performer
Effective Rent Growth Occupancy Rate
MSA Sep-12 Sep-13 Sep-14 Sep-12 Sep-13 Sep-14
Oakland, CA 7.2% 9.0% 11.5% 96.6% 96.9% 96.8%
San Jose, CA 8.2% 5.7% 11.0% 95.7% 95.8% 96.4%
Denver, CO 6.7% 6.9% 10.1% 95.3% 95.8% 96.2%
San Francisco, CA 10.5% 7.6% 7.9% 96.2% 96.2% 96.4%
Atlanta, GA 3.3% 5.0% 7.8% 92.5% 93.6% 94.3%
Seattle, WA 5.3% 7.2% 6.7% 95.0% 95.4% 95.5%
Miami, FL 4.2% 3.7% 6.4% 95.9% 96.0% 96.0%
Fort Lauderdale, FL 4.7% 3.0% 6.2% 94.7% 95.0% 95.7%
Phoenix, AZ 2.3% 2.5% 5.8% 93.2% 93.5% 94.1%
Houston, TX 6.7% 5.3% 5.4% 93.2% 94.3% 94.7%
National 3.6% 3.0% 4.3% 94.6% 94.8% 95.1%
Source: Axiometrics Inc.

31. Annual Effective Rent Growth by Rent Tier
National –Properties priced in the middle of the market (blue line) have been
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Aug-14
Sep-14
Top Tier Middle Tier Lower Tier
Source: Axiometrics Inc.

32. Where is the majority of your
portfolio located?
Urban Core Suburbs

33. Where is the majority of your
portfolio located?
Urban Core Suburbs
Where do you think rent growth is
the strongest?
Urban Core Suburbs

34. Urban and Suburban Performance
Source: Axiometrics Inc.
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Apr-09
Sep-09
Feb-10
Jul-10
Dec-10
May-11
Oct-11
Mar-12
Aug-12
Jan-13
Jun-13
Nov-13
Apr-14
Sep-14
Annual Effective Rent Growth
Urban Suburban
89.0%
90.0%
91.0%
92.0%
93.0%
94.0%
95.0%
96.0%
97.0%
Apr-09
Sep-09
Feb-10
Jul-10
Dec-10
May-11
Oct-11
Mar-12
Aug-12
Jan-13
Jun-13
Nov-13
Apr-14
Sep-14
Occupancy Rate
Urban Suburban

35. Annual Rent Growth by Effective Rent Level
9.0%
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
More often than not, top tier rent levels have shown slower annual rent growth
Atlanta
$500-$699 $700-$999 $1,000-$1,299 $1,300+
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Denver
$500-$899 $900-$1,199 $1,200-$1,499 $1,500+
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
5.0%
4.5%
4.0%
3.5%
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
Austin
Raleigh-Cary
$400-$799 $800-$999 $1,000+
0.0%
$700-$999 $1,000-$1,299 $1,300+
Source: Axiometrics Inc.

36. Rent Growth and New Deliveries -Austin
Dots represent individual properties.
New properties are defined as those
that delivered units between
January 2013 and June 2014. Annual
effective rent growth rates based on
the trailing 12 month average ending
June 2014.
Negative Rent Growth
Source: Axiometrics Inc.

37. Rent Growth and New Deliveries -Austin
Dots represent individual properties.
New properties are defined as those
that delivered units between
January 2013 and June 2014. Annual
effective rent growth rates based on
the trailing 12 month average ending
June 2014.
Negative Rent Growth
Source: Axiometrics Inc.

38. Rent Growth and New Deliveries -Austin
Dots represent individual properties.
New properties are defined as those
that delivered units between
January 2013 and June 2014. Annual
effective rent growth rates based on
the trailing 12 month average ending
June 2014.
Negative Rent Growth
Source: Axiometrics Inc.
> 5% Rent Growth

39. New Deliveries and Rent Growth by Market
Properties experiencing >5% rent growth
Atlanta Denver Dallas/Fort Worth
Dots represent individual properties.
New properties are defined as those
that delivered units between January
2013 and June 2014. Annual effective
rent growth rates based on the trailing
12 month average ending June 2014.
Source: Axiometrics Inc.

40. Rent Growth Forecast
Major markets will perform as well or better than the national average, and will
outperform their long-term average due to strong demand
Metro
Annual Rent Growth Forecast
Average 2015-2020
Difference from Long-Term
Average
Atlanta-Sandy Springs-Marietta, GA 3.3% 2.7%
Austin-Round Rock, TX 3.6% 2.2%
Chicago-Naperville-Joliet, IL 3.6% 1.7%
Dallas-Plano-Irving, TX 3.6% 2.3%
Denver-Aurora, CO 3.7% 1.4%
Houston-Baytown-Sugar Land, TX 3.8% 1.9%
Los Angeles-Long Beach-Glendale, CA 3.8% 0.4%
Miami-Miami Beach-Kendall, FL 3.6% 0.3%
New York-Wayne-White Plains, NY-NJ 3.4% 0.4%
Phoenix-Mesa-Scottsdale, AZ 3.5% 2.5%
San Francisco-San Mateo-Redwood City, CA 4.0% 0.2%
San Jose-Sunnyvale-Santa Clara, CA 4.2% 1.3%
Seattle-Bellevue-Everett, WA 3.8% 0.9%
National Average 3.3% 1.3%
Source: Axiometrics Inc.

41. Apartment Market Summary
• Apartment performance in 2014 is exceeding expectations.
• Supply is not having a major impact at the macro level.
• Suburbs and properties with affordable price points are outperforming
• Rent growth and occupancy will moderate in the short term, but the apartment
market will remain strong due to limited availability, demographics, steady job
growth and total residential supply remaining in check