ASIA PACIFIC - cushwakeasia.com...Omni-channel retailing is rapidly gaining momentum in the industry...

ASIA PACIFICFORECAST 2017Country Sections

JANUARY 2017

3

TOP 5 KEY THEMESInfrastructure transforming cities

1 New infrastructure development is transforming Australia’s commercial real estate markets. Central Business District (CBD) projects such as Sydney’s light rail and metro and Brisbane’s Queen’s Wharf are influencing supply and demand dynamics. Transport infrastructure projects are opening up new industrial

precincts as logistics companies move to key transport nodes.

Australia to retain relative value

2Despite ongoing property yield compression over the past few years, the CRE-bond yield spread remains relatively high. Furthermore, while Australian yields are low by historical standards, yields in other major global cities are near record lows. With prime CBD office stock currently yielding around 5-6%,

depending on the city, further compression is likely.

Sydney’s rising rents

3Strong service sector growth, lack of new supply, and stock withdrawal has driven annual CBD prime effective rental growth of 20% in 2016. With little new supply expected until 2021, average effective rental growth of 7% per annum is forecast over the next four years.

K E Y S TAT S

Sydney is expected to lead the country across all

asset classes in the near term. Robust economic growth, infrastructure

development, and healthy tenant demand will drive

rental growth. DOMINIC BROWN Head of Research,

Australia & New Zealand

ASIA PACIFIC FORECAST 2017

Australia

Rental growth in Sydney prime office (2016)

20%

Sydney CBD office stock permanently withdrawn 2016-18

140,000SQM

Melbourne prime office yield compression (2016)

50 BPS

Investments in Queensland retail assets during 2016 AUD

1.8 BILLION

Rental growth in Melbourne (2016)

8.4%

Retail Turnover

4Australian retail turnover growth in 2016 has been positive, but sub-trend. Limited by relatively slow wages growth as the nation continues to adjust to the end of the mining boom, future sales growth trends are expected to reflect state economic growth trends: stronger in the service-based states such as New South

Wales and Victoria and softer in the resource dominated states of Western Australia and Queensland.

Investment Market

5Despite four years of buoyant investment activity, significant capital continues to circle Australia. As the lower-for-longer cycle continues, available stock has become more of an issue. We expect investors to increasingly diversify across geography and sectors. As a result, investment in non-CBD stock is expected to

gather pace as an investment option outside of the office sector.

K E Y I N D I C ATO R SAUSTRALIA 2016E 2017F 2018F

GDP (%) 2.2% 1.8% 2.9%

Inflation (%) 1.2% 1.7% 2.2%

Unemployment rate (%) 5.7% 5.6% 5.5%

Retail sales (% growth) 2.1% 3.0% 3.2%

OFFICE (SYDNEY) 2016 2017F 2018F

Rent (AUD/Sqm/Year) 894 988 1064

Vacancy Rate (%) 5.3%* 2.4% 2.1%

New supply ('000 Sqm.) 95 -131 17

*mid-year

D O YO U K N O W ?

How quickly will Sydney CBD office rents continue to rise?

Will available investment stock be able to keep pace with investor demand?

Will office tenants prefer Melbourne’s cheaper rents over Sydney?

Will wage growth improve in 2017?

What direction will interest rates move next, and when?

Will there be a recovery in Australia’s resource-oriented markets?

For more information about research, please contact:

DOMINIC BROWN Head of Research Australia & New ZealandTel: +61 (0) 431 947 [email protected]

For all business requirements, please contact:

JAMES PATTERSONChief ExecutiveAustralia & New ZealandPhone: +61 2 8243 [email protected]

New infrastructure

is transforming Australia’s real estate markets

2

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TOP 5 KEY THEMESNew Supply

1Outbound Investment

2In Japan, investment volumes have declined 26% year on year (YoY) during 2016. Japanese investors, who traditionally favor domestic investment opportunities, continue to diversify their portfolios through overseas investments. As investor search for new opportunities, the overseas option will become more and

more popular. The United Kingdom (UK) and the United States of America (USA) are two of the most popular investment destinations for Japanese investors; however, in the wake of the UK’s Brexit Vote, the USA is the most likely recipient of future investment flows. The result of the recent US election is not likely going to upset the trend, but there may be a few parties that shift to a wait-and-see stance.

Changing Mindsets

3Retail sales continue to decline on a year over year basis in 2016. The decline is in part due to sentiment and also in part due to mild deflation; however, a changing consumer mindset is also affecting sales. In addition to tightening purse strings, consumers are placing more value on experience over products; a trend which

holds for both domestic and foreign consumers.

K E Y S TAT S

Several occupiers have decided to renew office

premises, deferring relocation plans to a

window from 2018-2020 when significant new

supply is forecast to result in more favorable tenant

conditions. TODD OLSON

Managing Director - Japan


Japan

Growth in inbound tourists (2010-15 CAGR)

18%

Increase in office construction costs (2011-16)

12%

Office Vacancy

4.1%Grade A new supply (2017-20)

605,000TSUBO

Investment volume decrease in 2016

-26%

Tokyo Olympics

4The Tokyo Olympics remains a beacon of optimism for the city; however, Tokyo faces a significant hurdle due to a ballooning budget and associated cost overrun concerns. Spearheaded by Koike, the new governor, Tokyo is making significant headway in addressing the problem. The major construction activities related

to the Olympics are expected for 2017 and 2018 and although they have yet to hit full swing, the anticipated activity, in combination with continued reconstruction efforts in Northern Japan, are exerting upward pressure on construction costs across Japan as contractors face labor shortages. Still the estimated economic benefit of the Olympic Games is estimated by the Bank of Japan to push up GDP growth by 0.2 to 0.3 percentage points for the years 2015-2018, ultimately adding roughly 5-6 trillion yen to GDP in 2018. *Source: Economic Impact of the Tokyo 2020 Olympic Games, Bank of Japan, January 2016

Tourism

5Inbound tourism figures continued their rise and once again set a new record in 2016, hitting the 20 million mark for the year in late October according to the Japan National Tourism Organization (JNTO). There has been a shortage in hotel availability in major cities prompting the Ministry of Land, Infrastructure, and Transportation to introduce land usage rules that allow developments with a hotel component to increase their floor area ratio. The Japanese government is looking to reach 40 million inbound tourists by 2020.

K E Y I N D I C ATO R SJAPAN 2016E 2017F 2018F

GDP (%) 1.0% 1.0% 0.9%

Inflation (%) -0.2% 0.2% 0.6%


Retail sales (% growth) -1.0% 1.2% 1.1%

OFFICE (TOKYO) 2016 2017F 2018F

Rent (JPY/Tsubo/Month) 35,400 36,500 36,000

Vacancy Rate (%) 4.1% 3.3% 6.5%

New supply ('000 Tsubo) 155 70 230

D O YO U K N O W ?

How will the Tokyo Olympics and the continued tourist boom affect the retail

landscape?

How are consumer mindsets shifting and where do the new opportunities lie?

Which submarkets are more likely to be affected by new supply?

How will financial technology ( fintech) companies impact the office market?

How are alternative workplace strategies reshaping the office environment?


TIMOTHY GREGERSENManager, Research, JapanDirect: +81 3 3596 [email protected]


TODD OLSON Managing Director, JapanDirect: +81 3 3596 [email protected]

New supply in 2018-2020

to create a fundamental shift in

market dynamics

4

From 2017 to 2020, more than 600,000 tsubo of new supply will be added to the Tokyo CBD; however, the overall impact on each submarket will be different. The new supply is highly disproportionate among the wards. For example, only 7% of the new supply pipeline is expected to be constructed in Shinjuku ward. Minato ward on the other hand, which already has the highest Grade A vacancy rate of the central five

wards, will see 40% of the new supply, suggesting that the vacancy rate should remain high in the ward for the next several years.

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TOP 5 KEY THEMESOffice Investments

1 Office transaction volumes in 2016 have recorded nearly a three-fold increase from last year. The market witnessed several buying opportunities as conglomerates with liquidity pressures were willing to dispose assets. Sale of IFC towers by AIG, for nearly US$2.1 billion was the record highest this year. Despite economic

concerns and uncertainty, real estate is still attractive due to low interest rates for institutional investors who are seeking alternative investment tools. More investments into hotels, logistics and retail are likely as they try to diversify the portfolios.

Startups driving demand

2The growth of start-ups in the e-commerce, gaming, fintech and transportation etc. is driving leasing activity. Serviced office providers are in expansion mode, driven partly by the boom in startups. WeWork has opened a co-working space in Gangnam district during Q3 and is coming up with another center in

Myeongdong during Q1 2017. Demand recovery in the traditional industries may be far off but the technology and service sectors are likely to drive the market next year.

Value add strategies

3Investors are considering more value-add retail investment opportunities as a way to diversify. For example, Gwanghwamun D-Tower has offered space to Uniqlo besides several popular restaurants. Gran Seoul and Tower 8's lower floors are also occupied by various retail shops. With office vacancies rising,

developers are exploring retail as a value-add strategy and this trend will likely continue next year.

K E Y S TAT S

Seoul will remain a tenant’s market over

the next two years. Diversifications into retail and industrial properties will also increase going

forward.RYAN LEE

Senior Director, Head of Global Occupier Services


South Korea

Office Vacancy (2016)

10.5%

Tightest submarket in the cityGANGNAM VACANCY

4.9%

Grade A new supply (2017-20)

673,889SQM

Current interest rate

1.25%

Investment volume hit the highest record (2016) around

₩9.5TRILLION

Single households

4According to Statistics Korea, the portion of single-person households is expected to reach 29.6% by 2020. The rising number of single-person households has prompted new retail trends and lifestyle patterns. It has also changed the landscape of dining industry and fast fashion retail through social networks.

Singles will become more influential to businesses going forward and companies are trying to catch up with this trend.

Omni-channel services

5Omni-channel retailing is rapidly gaining momentum in the industry as consumers gain control of the shopping experience and demand to shop everywhere and in every way possible. As marketers need to provide a seamless experience, regardless of channel or device, major retailers like Lotte and the Shinsegae

Group are aggressively investing to provide more omni-channel services.

K E Y I N D I C ATO R SSOUTH KOREA 2016E 2017F 2018F

GDP (%) 2.7% 2.5% 2.9%

Inflation (%) 1.0% 1.3% 1.5%



OFFICE (SEOUL) 2016 2017F 2018F

Rent (KRW/Sqm/Month) 41,500 41,300 40,500

Vacancy Rate (%) 10.5% 12.5% 14.5%

New supply (‘000 Sq.m) 117 45 176

D O YO U K N O W ?

With conditions in three core markets softening, will tenants continue to relocate

to Pangyo and Bundang?

Will incentives increase as there is more new and backfill space available in the

market?

What is the range of rental savings that can be achieved in Seoul by moving to a

coworking space?

Will corporate restructuring continue through 2018? Will there be more assets

for sale going forward?

Will 2017 be another record year for investments?


JUDY JANGSenior Manager, Research, South KoreaP+82 2 3708 [email protected]


RICHARD HWANG Managing Director, South KoreaP +82 2 3708 [email protected]

Value add strategies and

diversification will define investments

after a record year in 2016

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TOP 5 KEY THEMESOffice Supply Peak

1The overall China office market is facing a supply surge over the next 5 years with an expected 40 million sq m of new accommodation in 18 major Chinese cities by the end of 2020, almost equivalent to the existing total office stock in these cities combined. Tier I cities like Beijing & Shanghai are expected to continue to perform well due to

strong industry and ease of attracting top talent whereas Tier II cities such as Chongqing & Shenyang will face a more subdued rate of take up.

Retail Revolution

2We observed a significant amount of upgrading, refurbishment, conversion and re-positioning of malls across almost all cities tracked. Traditional department store operators have closed many stores due to the impact of emerging alternative retail models and e-commerce; while bricks and mortar retailers are continuing to

seek to break into the O2O business area while the experiential elements and F&B components continue to grow.

Co-working on the Rise

3Co-working is growing rapidly in China’s first-tier cities such as Beijing and Shanghai, fueled by the surging technology and e-commerce sectors, along with a wave of new start-ups. Co-working premises are increasingly favored by office tenants due to flexibility, often more affordable rents and more creative

environments.

K E Y S TAT S

Core areas of Tier-1 cities are likely to hold up thanks

to exceptionally strong rates of absorption and low prevailing vacancy. Tier-2 cities will likely receive the brunt of new construction and upward pressure on

vacancy levels. JAMES SHEPHERD

Head of Greater China Research


Greater China

Rental growth in Beijing Zhongguancun

22%

Total new supply in Greater China

70MILLION SQF

Total new supply in Greater China

43MILLION SQM

Office capital value growth in Shanghai

26%

Vacancy increase in Wuhan

21PERCENTAGE POINTS

*Values refer to 2016

K E Y I N D I C ATO R SCHINA 2016E 2017F 2018F

GDP (%) 6.7% 6.3% 5.9%

Inflation (%) 2.0% 2.4% 2.5%



OFFICE (BEIJING) 2016 2017F 2018F

Rent (RMB/Sqm/Month) 384 394 403

Vacancy Rate (%) 6.6% 9.7% 9.5%

New supply (‘000 Sq.m) 1,302 1,971 1,782

D O YO U K N O W ?

Will prime rents in CBD areas of Beijing and Shanghai get effected with large new

supply in non-core markets?

Will there be any impact on Shenzhen and Hong Kong markets with the latest stock

market connect?

Can we expect more Chinese banking and financial players to set up offices in Hong Kong and Southeast Asia going forward?

What are office market conditions in tier 2 markets? Is there an impact due to oversupply and economy slowing down?

What would be short and long term impact of capital controls announced recently?


JAMES SHEPHERD Managing Director, Research, Greater ChinaTel +86 21 2208 [email protected]


EDWARD KC CHEUNGChairman APAC Board & Chief Executive Greater China Phone: +86 21 2208 [email protected]

Investors will likely

step back into decentralized areas

in Tier-1 markets and selected areas

of some Tier-2 markets

Active Domestic Buyers in Tier 1 Markets

4Local players in China are taking a bigger slice of the country’s real estate investment pie than ever before, using deep pockets to snap up a growing share of the first tier markets such as Shanghai, Beijing and Hong Kong. Investors tend to target not only mature properties in core sub-markets, but also high quality

properties in other markets that offer unique features, in particular these include business parks and assets in good locations near core submarkets.

Booming E-commerce

5China’s booming e-commerce sector is not only having an impact on the retail market but is also bringing enormous demand to office and logistics markets. Companies from the technology and e-commerce sector are accounting for an increasing share of the prevailing Grade A office leasing demand across China, expanding

their footprints while also upgrading premises. The rise of e-commerce is also a strong driving force behind logistics demand in China.

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TOP 5 KEY THEMESReal Estate Investment Trusts

1 Real Estate Investment Trust (REIT) were introduced by the Securities and Investment Board (SEBI) in 2014, though the first application was only submitted recently in October 2016 after the Indian government removed some key hurdles; the first REIT listing is expected to be offered in 2017, paving the way for more listings.

Regulated Residential Market

2The Real Estate (Regulation and Development) Act, 2016 was enacted in March 2016 and outlined the mandatory requirements that will ensure accountability by developers and protect investors’ capital. The enforcement of a regulatory authority in residential realty would improve transparency in the market and

bring back buyer confidence; boosting the sales velocity that has been largely tepid in recent years. Developers have begun to make changes in their businesses in order to comply with the regulatory rules, and are now focusing on the completion and delivery of units.

Private Equity investments boom

3Large foreign Private Equity (PE) funds have been increasing their investments in Indian real estate, and are also diversifying their investment portfolio by increasing their exposure to the retail and hospitality sectors apart from investing in commercial office and residential sectors.

K E Y S TAT S

Rental growth will continue in Bengaluru,

Hyderabad, Chennai and Pune as demand is on par new supply. Investments

market will be very active over the next two years.

ANSHUL JAIN Managing Director,

India


India

FDI norms eased in

16SECTORS

REIT- eligible stock across major metros

275MILLION SF

Private equity investments in real estate (growth in 2016 )

20%Increase in residential

new launches (2016

16%Number of cities supported

under the urban renewal plan

500

‘Make in India’ campaign set to boost industrial, logistics and warehousing activity

4The Indian government’s strong support to its ‘Make in India’ campaign to boost the share of manufacturing in the country’s Gross Domestic Product (GDP) is resulting in increased demand for industrial, logistics, and warehousing parks. Many reputed developers and funds have announced plans to invest and develop

in these real estate assets.

Demonetization

5Given that India is majorly dependent on cash transactions, demonetization and the drive towards digital payments is expected to slow down the economy for at least a couple of quarters. A slowdown in land and high-end residential sales is likely in the short term but the move will have a positive effect

in the longer run as it enforces transparency in the system. End users and genuine investors will benefit from lower prices over the next 2-3 quarters with sales slowing down and liquidity squeezed.

K E Y I N D I C ATO R SINDIA 2016E 2017F 2018F

GDP (%) 7.1% 6.7% 7.2%

Inflation (%) 5.0% 4.7% 5.4%



OFFICE (BENGALURU) 2016 2017F 2018F

Rent (INR/Sf/Month) 73.27 86.95 92.40

Vacancy Rate (%) 6.2% 5.9% 3.1%

New supply ('000 Sf) 12,309 10,007 6,117

D O YO U K N O W ?

How will lease accounting changes impact real estate decisions in organizations?

Will rents continue to strengthen in 2018? What range of appreciation is expected?

What tangible benefits do work place strategies offer for increasing productivity

and reducing costs?

Will supply constraints in Bengaluru, Chennai, Hyderabad and Pune restrict the

demand for office spaces in these cities?

What impact will increased ownership of office assets by institutional / PE funds /

REITs have on occupiers’ businesses?

With top cities in India facing infrastructure challenges, is the time right to assess expansion / entry into other tier 2

& 3 cities?


SIDDHART GOELSenior Director, Research Services, IndiaTel: +91 (80) 4046 [email protected]


ANSHUL JAINManaging Director, IndiaPhone: + 91 124 469 [email protected]

REITs, investments

and tight vacancies in select markets will define

the office sector in 2017

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13

TOP 5 KEY THEMESInfrastructure

1 Delivering and enabling infrastructure investments will remain a key objective for most Southeast Asian economies as it remains an important pre-condition for continued economic growth. Spending by Southeast Asian economies on infrastructure is expected to grow by 9% a year in the next 10 years. Increasing

prosperity in emerging markets is expected to drive infrastructure financing toward consumer sectors, including transportation and manufacturing sectors that provide and distribute raw materials for consumer goods. Major capital cities in the region are also investing in urban subway systems, extending or establishing new lines, even in mature markets in Singapore. Furthermore, plans to develop a cross border railway are in an advanced stage.

Policy Reforms

2Liberalization of foreign investment rules will result in more open economies and easier access to real estate investment opportunities in the region; the higher liquidity and deeper capital pool should catalyze the region’s real estate market. We have already seen the partial lifting of foreign ownership restrictions

in condominiums rejuvenating Vietnam’s residential market and investors will likely be factoring further reforms when exploring the Southeast Asia market. Partly due to the implementation of pre-arranged regional integration and standardization measures, these reforms will likely be sustained as competition between member states for foreign investments will heighten and which would be necessary to take advantage of an integrated market.

K E Y S TAT S

Southeast Asia will continue on a strong

growth path despite Trans Pacific Partnership (TPP). Broad based office demand

will remain stable with most markets expected to

perform betterSTEVE SAUL

Managing Director, Singapore


SoutheastAsia

Southeast Asia’s market size

620MILLION PEOPLE

Combined GDP of Southeast Asian nations

US$ 2.6(6TH LARGEST IN WORLD GDP RANKINGS)

Total retail sales (2016)

US$ 736 BILLION

Median age in Indonesia, Philippines and Vietnam

25-34 YEARS

Fastest growing economy in 2017 – Vietnam

6.7%

Demographics

3If the world is on the cusp of the Asian century, then Southeast Asia, whose population forms about a fifth of the region, will be crucial to the continual transformation. The major cities of Southeast Asia, which currently account for a quarter of the region’s GDP, will see its share dwindle as its secondary cities

develop with close to 100 million people expected to move to urban areas by 2025. Pivotal to this shift will be the continued growth of the region’s emerging markets, which will elevate overall income levels and double the number of middle income households in the next ten years. Keeping pace with this growth will demand some $7 trillion in investment in infrastructure, housing, and commercial space.

Regional and Global Integration

4Even as Southeast Asia braces for the collapse of the Trans-Pacific Partnership, Southeast Asia’s growing integrating regionally and globally is unlikely to be halted. The global economy has become deeply interconnected and Southeast Asia will continue to capitalize on this phenomenon by accelerating the progress of

the ASEAN Economic Community, leverage on the favorable demographics and take steps to build a more competitive manufacturing sector to remain attractive to MNCs as labor costs rise in China. The region will continually to push for progress in wider trade pacts, such as the Regional Comprehensive Economic Partnership (RCEP) - mooted by China. However, all these could come at the expense of lesser involvement of the United States.

Construction Boom

5With nearly 22 Million sf (msf) of new supply under construction, office stock in Southeast Asia is set to rise by 13% next year. Manila leads office completions at 11 msf, followed by Jakarta (5.9 msf) and Singapore (2.2 msf). As such, average vacancy rate is expected to increases to 14.8% from 10.6% over the next

12 months. Average rents will face further downward pressure in Jakarta, Kuala Lumpur and Singapore where vacancies are rising above the long term average. Rents in Singapore and Jakarta have already softened by 7% and 18% last year. Flight to quality will continue as landlords compete for tenants amidst rising vacancies. Bangkok alone will remain landlord favorable where sub 5% vacancies and limited new supply are pushing rentals up by 3-5% on an annual basis.

D O YO U K N O W ?

Will manufacturing growth continue despite TPP fallout?

What is the level of incentives in markets with higher than average vacancies such

as Jakarta, Singapore and Kuala Lumpur? Are they trending higher?

Will rents continue to increase in Manila despite higher new supply? Are there any

opportunities for rental savings?

Will rental decline continue in Singapore beyond 2017?

Are there any recent policy measures that promote investments and asset ownership

in emerging Southeast Asian markets?

Is there any noticeable impact on retail or residential real estate with growing tourist

arrivals?

Long term opportunities

abound despite short term setbacks

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For more information about research, please contact:K E Y I N D I C ATO R S

INDONESIA 2016E 2017F 2018F

GDP (%) 5.0% 5.1% 5.3%

Inflation (%) 3.5% 3.9% 4.3%



OFFICE (JAKARTA) 2016 2017F 2018F

Rent (RP/Sqm/Month) 394,230 354,807 345,936

Vacancy Rate (% ) 22.3% 28.9% 29.4%

New supply ('000 Sqm) 312 545 287

PHILIPPINES 2016E 2017F 2018F

GDP (%) 6.9% 6.1% 6.0%

Inflation (%) 1.8% 3.1% 3.7%



OFFICE (MANILA) 2016 2017F 2018F

Rent (PHP/Sqm/Month) 923 941 957

Vacancy Rate (% ) 2.3% 4.4% 5.2%

New supply ('000 Sqm) 300 1415 1076

VIETNAM 2016E 2017F 2018F

GDP (%) 4.5% 4.6% 4.9%

Inflation (%) 2.8% 3.5% 3.8%



OFFICE (HO CHI MINH CITY) 2016 2017F 2018F

Rent (USD/Sqm/Month) 46.50 46.30 45.90

Vacancy Rate (% ) 5.7% 19.7% 7.3%

New supply ('000 Sqm) 0 65 0

NATHAN NGUYENSenior Analyst, Research Services,

Asia Pacific Tel:+65 6232 0863

[email protected]

CHRISTINE LIDirector, Research, Singapore

Tel: + (65) 6232 [email protected]

ARIEF RAHARDJODirector, Research & Advisory

IndonesiaTel: +62 21 2550 9540

[email protected]

JANLO DE LOS REYES Manager, Research & Consultancy,

Philippines Tel: +63 2 554 29 27

[email protected]

PHUOC VO Director, Valuation & Research,

Vietnam Tel: +848 3823 7968

[email protected]

SINGAPORE 2016E 2017F 2018F

GDP (%) 1.8% 1.9% 3.3%

Inflation (%) -0.5% 1.0% 2.3%



OFFICE (SINGAPORE) 2016 2017F 2018F

Rent (SGD/Sf/Month) 8.63 8.42 8.86

Vacancy Rate (% ) 6.1% 10.0% 9.0%

New supply ('000 Sf) 1,452 2,256 805

THAILAND 2016E 2017F 2018F

GDP (%) 3.1% 3.1% 3.3%

Inflation (%) 0.1% 1.8% 2.1%



OFFICE (BANGKOK) 2016 2017F 2018F

Rent (THB/Sqm/Month) 920 948 971

Vacancy Rate (% ) 6.0% 5.4% 4.9%

New supply ('000 Sqm) 0 25 0

MALAYSIA 2016E 2017F 2018F

GDP (%) 4.1% 4.2% 4.3%

Inflation (%) 2.1% 2.7% 2.7%



OFFICE (KUALA LUMPUR) 2016 2017F 2018F

Rent (MYR/Sf/Month) 7.35 7.00 6.75

Vacancy Rate (% ) 14.2% 15.0% 14.9%

New supply ('000 Sqm) 1,342 1,500 1,350


STEVE SAULManaging Director, Singapore

Phone: +65 6232 0878 [email protected]

ALEX CRANEGeneral Manager, Vietnam Phone: +84 8 3823 7968

[email protected]

DAVID CHEADLEManaging Director, Indonesia

Phone: +62 21 2550 9580 [email protected]

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About Cushman & Wakefield:

Cushman & Wakefield (C&W) is known the world-over as an industry knowledge leader. Through the delivery of timely, accurate, high-quality research reports on the leading trends, markets around the world and business issues of the day, we aim to assist our clients in making property decisions that meet their objectives and enhance their competitive position. In addition to producing regular reports such as global rankings and local quarterly updates available on a regular basis, C&W also provides customized studies to meet specific information needs of owners, occupiers and investors.

Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and live. Our 43,000 employees in more than 60 countries help investors optimize the value of their real estate by combining our global perspective and deep local knowledge with an impressive platform of real estate solutions. Cushman & Wakefield is among the largest commercial real estate services firms with revenue of $5 billion across core services of agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

This report has been prepared solely for information purposes. It does not purport to be a complete description of the markets or developments contained in this material. The information on which this report is based has been obtained from sources we believe to be reliable, but we have not independently verified such information and we do not guarantee that the information is accurate or complete. Published by Corporate Communications.

©2017 Cushman & Wakefield, Inc. All rights reserved.

Cushman & Wakefield, Singapore3 Church Street Samsung Hub #09-03 Singapore 049483www.cushmanwakefield.com

About Cushman & Wakefield:

Cushman & Wakefield (C&W) is known the world-over as an industry knowledge leader. Through the delivery of timely, accurate, high-quality research reports on the leading trends, markets around the world and business issues of the day, we aim to assist our clients in making property decisions that meet their objectives and enhance their competitive position. In addition to producing regular reports such as global rankings and local quarterly updates available on a regular basis, C&W also provides customized studies to meet specific information needs of owners, occupiers and investors.

Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and live. Our 43,000 employees in more than 60 countries help investors optimize the value of their real estate by combining our global perspective and deep local knowledge with an impressive platform of real estate solutions. Cushman & Wakefield is among the largest commercial real estate services firms with revenue of $5 billion across core services of agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

This report has been prepared solely for information purposes. It does not purport to be a complete description of the markets or developments contained in this material. The information on which this report is based has been obtained from sources we believe to be reliable, but we have not independently verified such information and we do not guarantee that the information is accurate or complete. Published by Corporate Communications.

©2017 Cushman & Wakefield, Inc. All rights reserved.

Cushman & Wakefield, Singapore3 Church Street Samsung Hub #09-03 Singapore 049483www.cushmanwakefield.com

ASIA PACIFIC - cushwakeasia.com...Omni-channel retailing is rapidly gaining momentum in the industry...

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