Applefield Waxman :: Company Overview

NEWSLETTER	FOURTH QUARTER 2007

Overview	This past year was a period of exciting growth and expansion for our company. We added several new professionals to our team and moved our corporate headquarters to Palm Beach Gardens. We also launched a new website and continued our northward expansion to the Orlando market. For 2008, we look forward to growing our firm, increasing our market coverage and seeking out additional real estate opportunities.

The Market	The South and Central Florida commercial real estate markets have slowed down. For the fourth quarter of 2007, the office vacancy rate increased to 15% (versus 11.9% last quarter) and the average lease rate slightly decreased to $17.91 PSF (versus $18.02 PSF last quarter). Net absorption (the change in occupied square feet) of space was negative 550,000 (versus negative 84,000 SF last quarter). Construction activity decreased to 880,000 SF (versus 1,000,000 SF last quarter). Contributing factors which led to an increase in vacancy and negative absorption were the completion of a large office project in Boca Raton and the downsizing of several corporate users in the South County area. For the fourth quarter of 2007, the industrial vacancy rate remained steady at 6.9% and the average lease rate slightly decreased to $9.80 PSF (versus $10 PSF last quarter). Net absorption of space was negative 419,620 SF (versus negative 178,340 SF last quarter). Construction activity increased to 890,000 SF (versus 633,860 SF last quarter). Looking forward into 2008, the office and industrial markets should continue to grow, albeit a slower pace than previous years. Due to the state’s population growth, business activity and international trade, demand for commercial properties should remain steady. However, latent effects from the residential slowdown and the weakened national economy may curtail this growth. Overall, we are cautiously optimistic that the local commercial real estate market is positioned for sustainable, long-term expansion.

Brokerage	Our brokerage division continues its forward momentum. YTD 2007, we completed a number of noteworthy transactions which included: Acquisition of 71,000 SF office building in Lake Mary, Orlando suburb Acquisition of 75,000 SF medical office building in Palm Beach Gardens Sale of 6.2 acre light industrial parcel in Lake Park In addition, we hired Douglas Stockham as a real estate agent. Doug is accomplished broker from Birmingham, Alabama. He specializes in office and industrial sales and leasing.

Property Management	Our property management division continues its steady performance. YTD 2007, we successfully managed fifty two buildings within our core market. We continue to focus on building our internal infrastructure and growing our management capabilities.

Investment	Our investment division continues its rapid advancement. YTD 2007, we acquired a 71,000 SF professional office building, a 75,000 SF medical office building and progressed with the development of a 200,000 SF office/warehouse project. We also completed the renovation of a 70,000 SF medical office complex. Looking forward, we are excited about the creation of our first real estate fund, AW Capital Partners. We intend to seed this fund by rolling-up several of our existing properties. The estimated launch date is Q2 2008. Details will be forthcoming.

Applefield Waxman is a diversified commercial real estate company that specializes in the South and Central Florida markets. We offer brokerage, property management and investment services. Our headquarters are located in Palm Beach Gardens with regional offices in West Palm Beach, Lake Park, Port St. Lucie and Melbourne. To learn more, please visit our website at www.applefieldwaxman.com or call (561) 687-5800.