Asia Pacific Industrial 2012 H1

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW
May 2012
Accelerating success.
TABLE OF CONTENTS
ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW
This is the 14th issue of the Asia Pacific Industrial Market Overview, which covers 13 cities in nine countries, for the review period of October 2011 to March 2012. With this bi-annual update, we hope to provide an overview of industrial markets catering to multinational corporations and a comparison of industrial real estate costs across the key cities in the Asia-Pacific region. Three types of industrial properties are tracked in this report, namely single-user factory premises, single-user warehouse premises and multi-user high-specifications industrial premises, as these are the preferred choices of multinational corporations. This publication features land and capital values, as well as rents of single-user industrial premises; and rents of multi-user highspecification factories.
| MAY 2012
Regional Overview
Australia
5-6
Melbourne ............................................................................................................ 5 Sydney ................................................................................................................. 6 China 7-9 Beijing ...................................................................................................................7 Guangzhou ........................................................................................................... 8 Shanghai .............................................................................................................. 9 Hong Kong SAR India 10-11 12 New Delhi ...........................................................................................................12 Indonesia 13-14
Jakarta ................................................................................................................ 13 Japan 15 Greater Tokyo .....................................................................................................15 New Zealand 16-17
Auckland .............................................................................................................16 Wellington ........................................................................................................... 17 Singapore Taiwan 18-19 20
Taiwan ................................................................................................................ 20 International Comparison 21-27
Single-user Warehouse Land Values, Capital Values and Monthly Gross Rents ...................................................................................21 Single-user Factory Land Values, Capital Values and Monthly Gross Rents .................................................................................. 24 Multi-user High-Specs Average Monthly Gross Rents..................................... 27 Local Market Norm 28-30
Single-user Warehouse Land Values, Capital Values and Monthly Gross Rents .................................................................................. 28 Single-user Factory Land Values, Capital Values and Monthly Gross Rents .................................................................................. 30 Definitions & Terminology 31
REGIONAL OVERVIEW
Weighed down by the persistent uncertainties surrounding the United States (US) and the Eurozone economic situations, the Asia-Pacific region generally experienced slower economic growth in the final quarter of 2011. Reduced demand for exports from the Eurozone as well as massive floods in Thailand that disrupted manufacturing production lines, also contributed to the slowdown in economic growth in 4Q 2011. However, the overall economic situation in the Asia-Pacific region appeared to have improved somewhat in the first three months of 2012 in response to signs of improvement in the US economy and efforts by the European Central Bank to resolve the sovereign debt crisis. Against this backdrop, the performance of the industrial markets in the 13 Asia-Pacific cities surveyed softened over the period between October 2011 and March 2012. Although the majority of the submarkets surveyed continued to enjoy appreciation in land, capital and rental values, most reported either stable or a slower rate of growth. In the industrial land segment, the majority (44 out of 55) of single-user industrial submarkets surveyed saw land values rise or hold steady compared to the previous six-months. The remaining 11 submarkets saw declines in land values. Leading the price increases were Indonesias Karawang and Bekasi areas, where land prices surged by another 38.6% and 24.9% respectively during the current review period, as Indonesias sustained economic growth and low labour costs continued to appeal to manufacturers. However, the growth rate moderated from the blistering 45.0% recorded in the preceding period. Similarly, while land prices in Singapore continued to rise on the back of robust industrial land sales, the rate of increase slowed. In contrast, industrial land prices in Greater Tokyo fell for the seventh consecutive review period, albeit at a slower pace during the October 2011 to March 2012 period amid signs of an improving economy. Underpinned by healthy sales, capital values in the majority (52 out of 58) of the submarkets surveyed either held steady or experienced some upside over the six months ending March 2012. This was relatively unchanged from the previous review period where 51 out of 58 submarkets recorded growth or maintained their capital values. Notably, average capital values growth in Shanghai accelerated to close to 12.0% in the current review period, compared to just 1.4% in the preceding six months, as the lowering of the reserve requirement ratio for banks facilitated the acquisition of ready-built industrial facilities. Likewise in Auckland, the relatively active industrial sales market led to a strengthening in capital values growth. However, it was a different picture in Wellington where a slight softening of yields caused capital values to fall. Meanwhile, capital values in Greater Tokyo exhibited greater stability with marginal declines recorded on the back of healthy investment sales. The survey also revealed a rise in the number of single-user industrial submarkets experiencing a rent decline in the October 2011 to March 2012 period. Overall, rents fell in eight out of 53 submarkets surveyed, compared to just one out of 54 submarkets in the preceding six-month period. This was mainly due to weaker rents in New Zealand, where a slowdown in industrial leasing activity in Auckland caused net rents to fall. Likewise, in New Zealands Wellington region, net rents fell for the first time since March 2010 due to increased insurance costs arising from the Christchurch earthquakes that was typically passed on to tenants.
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REGIONAL OVERVIEW
Rents of high-specification (high-specs) multi-user industrial facilities were more resilient. Although the number of submarkets reporting a rise in rents had declined from 12 in the last survey, to seven in the most recent survey (out of 17 submarkets), only one submarket (Yokohama) saw rents fall due to weak leasing demand. The remaining eight submarkets reported stable rents during the current review period. Amid signs of an uplift in economic prospects, the majority of the submarkets surveyed are expected to experience stability or growth in values and rents over the next 12 months, on the back of healthy demand and reduced vacancy. The exceptions are Singapore, Hong Kong and Taipei where industrial rents and values are forecasted to decline due to the presence of downside risks in the external environment, which is expected to affect demand. In Wellington, while land values are expected to stay stable in the next 12 months, capital values and net rents are projected to fall over the same period as earthquake issues surrounding the property market are expected to remain a dampening factor in the industrial market.
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| COLLIERS INTERNATIONAL
ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012
AUST R A L I A
ECONOMIC INDICATORS FOR MELBOURNE ECONOMIC INDICATORS
INDICATORS PERIOD DATA
Year-on-Year GDP Growth Year-on-Year Manufacturing Output Growth Rate Total Imports Total Exports Container Throughput (TEUs) Air Cargo Throughput (Tonnes)
* n.a. denotes not available
October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012
0.51% -1.53% A$30.6 billion A$9.6 billion 1,097,209 n.a.
MELBOURNE Factory and Warehouse Demand for industrial space remained stable during the review period between October 2011 and March 2012 supported by companies move to expand and consolidate their premises on the back of a robust trade market. The market saw imports and exports holding relatively stable at A$30.6 billion and A$9.6 billion respectively between October 2011 and March 2012, as compared to A$30.1 billion and A$10.8 billion achieved in the previous review period. However, unresolved sovereign debt issues in the Eurozone continued to impinge on the global economic recovery and has put a cap on the growth of Melbournes industrial land and capital values as well as rents, which thus remained stable during the six-month review period between October 2011 and March 2012. On the sales front, a total of eight investment sale transactions (A$5 million and above) took place between October 2011 and March 2012. The total value transacted during the review period was in excess of approximately A$145 million. This is lower than the A$270 million garnered from 11 investment sales done in the preceding six-month period. Sale transactions concluded during the current review period included GPTs acquisition of a 299,594-sq ft warehouse at Citiport Business Park, Port Melbourne and Quintessential Equities purchase of a 268,228-sq ft warehouse at 8 Dunlop Court, Bayswater.
MAJOR TRANSACTIONS IN MELBOURNE TRANSACTIONS
BUILDING/LAND PLOT PROPERTY TYPE LEASE/SALE TENANT/PURCHASER FLOOR/LAND AREA (SQ FT)
The industrial leasing market remained healthy in the six months leading up to March 2012 but the average lease term is now shorter (i.e. five years) than the long term average of seven to 10 years. Approximately 3.5 million sq ft of space (involving deals above 32,000 sq ft) was leased between October 2011 and March 2012, with the bulk taking place in the West (1.80 million sq ft) and in the South East (1.25 million sq ft). This is an improvement from the 2.2 million sq ft leased in the previous review period between April and September 2011. Recent leasing deals include Silk Logistics committing to a 474,004-sq ft warehouse at Kororoit Creek Road, Altona North; Trimas taking up a 270,209-sq ft warehouse along Atlantic Drive, Keysborough; and Corning leasing a 188,704-sq ft warehouse at 71-83 Whiteside Road, Clayton. Increase in tenant demand for new space resulted in increased construction activity. Approximately A$173 million worth of industrial space was initiated between October 2011 and March 2012 as opposed to A$87 million committed over April to September 2011. Overall, the industrial market is expected to continue to perform well in 2012 as limited availability of quality stock coupled with increasing tenant demand should see a decline in vacancies. Rents, capital values and land values are thus expected to increase marginally due to the tighter space market over the next 12 months.
437 - 481 Plummer Street, Port Melbourne Atlantic Drive - Warehouse A, Keysborough 71 - 83 Whiteside Road, Clayton Atlantic Drive, Keysborough Kororoit Creek Road, Altona North 19 - 39 Studley Court, Derrimut 8 Dunlop Court, Bayswater Citiport Business Park, Port Melbourne 557 Mount Derrimut Road, Derrimut
Industrial Industrial Industrial Industrial Industrial Industrial Industrial Industrial Industrial
Lease Lease Lease Lease Lease Sale Sale Sale Sale
Chrysler Australia ESR Holdings Corning Trimas Silk Logistics Private Investor Quintessential Equities Pty Ltd GPT Private Investor
139,932 172,601 188,704 270,209 474,004 252,470 268,228 299,594 301,650
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AUST R A L I A
ECONOMIC INDICATORS FOR SYDNEY ECONOMIC INDICATORS
July - December 2011 October 2011 - March 2012 August 2011 - January 2012 August 2011 - January 2012 August 2011 - January 2012 October 2011 - March 2012
1.2% n.a. A$155.3 billion A$162.5 billion 1,236,232 n.a.
SYDNEY Factory, Warehouse and High-Specs High interest rates and ongoing growth in the economy that was driven mainly by the mining and resources boom has caused the Australian dollar to remain strong against the US dollar. This has led to strong import growth, which in turn supported demand for warehouse and storage space for goods, despite the uncertain global economic environment. Land values, rents and capital values have all remained stable across Sydney over the past six months, as tenant demand and owner occupier sale transactions have remained steady. Functional, well designed and correctly priced developments continued to receive healthy interest from owner occupiers and private investors during the review period. The largest deal that took place in Sydney over the past six months was Qube Logisticss A$123 million purchase of Stocklands 55% stake in the Moorebank Industrial Property Trust in March 2012. The trust owns the Moorebank Intermodal Terminal. However, quality industrial space remains limited in stock. Institutional landowners, who have taken advantage of the lack of available space in the market to speculatively build new industrial
MAJOR TRANSACTIONS IN SYDNEY TRANSACTIONS
assets, have benefitted from the robust occupier demand. This is evident from the high commitment rates of all recently completed speculatively built stock. The largest of these commitments is the Dexus lease of a 226,042-sq ft newly built facility in Lenore Lane, Erskine Park to DB Schenkar. The availability of Prime Grade stock on the market is expected to continue to tighten over the next 12 months, as existing supply and speculative new developments continues to fall short of demand. This will likely lead to a reduction in the availability of lower grade stock, as demand spills over from the Prime Grade market into the Secondary Grade market. This decline in vacancy levels is expected to support the return of rents and capital values growth of up to 2.4% over the next 12 months across a number of Sydneys industrial markets while incentives for tenants should begin to fall in the short term.
1 Hale Street, Botany 53 Britton Street, Smithfield 94 - 106 Lenore Drive, Erskine Park Moorebank Intermodal Terminal [55% stake] 920 Richmond Rd, Marsden Park L7, Central Hills Business Park , Gregory Hills 17 - 21 Doody St, Alexandria 111 Wicks Rd, North Ryde 17 - 19 Orion Rd, Lane Cove 97 Williamson Rd, Ingleburn 21 Worth St, Chullora
Warehouse Warehouse Warehouse Intermodal Terminal Land Land Warehouse Warehouse Warehouse Warehouse Warehouse
Lease Lease Lease Sale Sale Sale Sale Sale Sale Sale Sale
TOLL Paper Cope Sensitive Freight DB Schenkar Qube Logistics Ikea Owner Occupier Owner Occupier Owner Occupier Private Investor Owner Occupier Private Investor
87,984 141,040 226,042 n.a. n.a. 161,459 38,266 54,239 87,102 108,759 267,634
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CHINA
ECONOMIC INDICATORS FOR BEIJING ECONOMIC INDICATORS
January December 2011 January December 2011 July December 2011 July December 2011 July December 2011 July December 2011
8.1% 7.9% US$171.9 billion US$32.0 billion n.a. 780,600
BEIJING Factory and Warehouse Beijing managed to achieve a gross domestic product (GDP) and a manufacturing output growth of 8.1% year-on-year (YoY) and 7.9% YoY respectively in 2011. Meanwhile, exports and imports amounted to US$32 billion and US$171.9 billion during 2H 2011, up 6.5% and 34.2% YoY respectively. On the other hand, air cargo throughput declined 5.2% YoY in the same period, but still managed to clock 780,600 tonnes. Beijings stable economy in 2011 paved the way for a strong industrial property market that saw hikes in land and capital values as well as rents during the review period between October 2011 and March 2012. On average, land values expanded by between 2.7% and 3.5%, whilst capital values strengthened by between 2.7% and 4.3% over the six-month period. Rents of industrial properties also experienced increases across the board, ranging between 4.3% and 5.3%. State-owned and domestic enterprises continue to be the main demand generators for industrial land, mostly purchasing land to construct facilities for self-occupancy. Some examples include Beijing Hi-tech Business Innovation Service Centres purchase of a parcel with a land area of 4.43 million sq ft in the Miyun Economic and Development Zone for CNY248 million and Beijing Jingdong Century Commerce Companys acquisition of a 2.25 million sq ft-plot in Yizhuang for CNY290 million. In addition, Beijing Liandongyongle Investment and Management Company recently bought a piece of land, which covers an area of 0.93 million sq ft, for CNY42 million.
MAJOR TRANSACTIONS IN BEIJING TRANSACTIONS
The leasing market was supported by occupier demand from various overseas and domestic companies including Business-to-Consumers (B2C) industries, third party logistics (3PL) companies and retailers. For example, during the review period, DHL took up 43,055-sq ft of warehouse space at Crown Logistics Centre, Unipart Logistics committed to 53,819-sq ft of warehouse space at GLP Park Beijing Capital Airport and Gome leased 269,100-sq ft of warehouse space at Dewei. Supply-wise, three new projects were added to Beijings industrial market stock during this review period. One was the Goodman Beijing Airport Logistics Centre that has a gross floor area (GFA) of 320,624 sq ft. The others were GLPs completed projects, namely GLP Park Beijing Capital Airport and GLP City Park Daxing with GFA of 0.32 million sq ft and 1.02 million sq ft respectively. Despite the expected deceleration of Chinas economy, Beijings industrial market is expected to maintain its upward trend in the coming 12 months, underpinned by the continued strong demand from 3PL, B2C and e-business companies as well as retailers. However, growth could be limited by rising operational and transportation costs facing logistics players. Therefore, average rents are expected to grow more moderately by up to about 4%, underscored by the continued strong occupier demand. Land and capital values are expected to inch up around 2-3% during this period.
Crown Logistics Centre GLP Park Beijing Capital Airport Dewei Tongzhou Yizhuang Miyun Economic and Development Zone
Warehouse Warehouse Warehouse Land Land Land
Lease Lease Lease Sale Sale Sale
DHL Unipart Logistics Gome Beijing Liandongyongle Investment and Management Company Beijing Jingdong Century Commerce Company Beijing Hi-tech Business Innovation Service Centre
43,055 53,819 269,100 930,271 2,253,984 4,433,590
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CHINA
ECONOMIC INDICATORS FOR GUANGZHOU ECONOMIC INDICATORS
January December 2011 January December 2011 July December 2011 July December 2011 July December 2011 July December 2011
11.0% 12.9% US$31.8 billion US$29.5 billion 7.8 million 791,000
GUANGZHOU Factory and Warehouse Notwithstanding the slowdown in global economic recovery and the contagion of the Eurozone sovereign debt crisis, Guangzhous economy grew by a steady 11.0% YoY in 2011. The export and import volumes also maintained steady growth in the second half of 2011 to US$29.5 billion and US$31.8 billion respectively, up 12.7% and 10.3% compared to the same period in 2010. Supported by a healthy economic environment and an expanding domestic retail market, leasing demand for industrial properties remained robust between October 2011 and March 2012. The demand for warehouse space came mainly from domestic enterprises in sectors such as food, clothes, electronic components and the fast moving consumer goods industry while factory space was in demand by the medicine, mechanical and electric equipment and material industrial companies. On the other hand, the availability of high quality industrial facilities for lease in the district remained limited. These provided the impetus for average rents of warehouse and factory space in Guangzhou Economic & Technology Development District (GETDD) to grow by 4.0% and 2.6% to reach CNY2.85 per sq ft per month and CNY2.73 per sq ft per month respectively during the review period. The average capital value of industrial properties also trended up by 4.2% over the review period to CNY269.50 per sq ft while the average land value rose by 0.9% in the six-month period to CNY56.67 per sq ft by the end of March 2012. These figures were fuelled by robust demand on the back of the favourable economic performance and increasing domestic consumption demand. In
MAJOR TRANSACTIONS IN GUANGZHOU TRANSACTIONS
particular, enterprises from the logistics, electric instruments, medicine, mechanical and electric equipment and material industries were active in looking to purchase ready-built industrial properties and land plots during the review period. Domestic enterprises continued to dominate land purchases, acquiring 12 out of the 15 industrial land plots launched for sale in GETDD in the six months ending March 2012. For example, Guangzhou Jingdong Trade Co. Ltd, a famous e-business company in China, acquired an industrial land plot with a total site area of 1.08 million sq ft in Jiulong Industrial Park for CNY60.41 million. In addition, Guangzhou Nanxin Medicine acquired an industrial land plot with a total site area of 0.44 million sq ft in Guangzhou Science City for CNY25.09 million. The three deals by foreign or multinational firms were Guangzhou Procter & Gambles acquisition of a 2.16 million sq ft plot in ChinaSingapore Knowledge City, Yakult (Guangzhou) Co. Ltds acquisition of 0.36 million sq ft plot in Yonghe, GETDD and Vejesto Electrics acquisition of a 0.14 million sq ft site in Jiulong Industrial Park. Underpinned by continuous healthy performance of the domestic economy and the limited new supply of industrial space (especially for warehouses), rental and capital values of warehouse and factory space in GETDD are expected to continue to grow by between 2.6% and 4.2% in the next 12 months. Land values, on the other hand, will likely hold relatively stable with upsides of about 0.4% in the same period.
Jiulong Industrial Park Jiulong Industrial Park Development Zone, Yonghe, GETDD Guangzhou Science City Jiulong Industrial Park China-Singapore Knowledge City, GETDD
Land Land Land Land Land Land
Sale Sale Sale Sale Sale Sale
Vejesto Electric Guangzhou Zhenghan Material Technology Yakult (Guangzhou ) Co.Ltd Guangzhou Nanxin Medicine Guangzhou Jingdong Trade Co. Ltd (360buy.com) Guangzhou Procter & Gamble
139,891 312,277 362,020 442,408 1,077,840 2,164,966
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CHINA
ECONOMIC INDICATORS FOR SHANGHAI ECONOMIC INDICATORS
Year-on-Year GDP Growth Year-on-Year Manufacturing Output Growth Total Imports Total Exports Container Throughput (TEUs) Air Cargo Throughput (Tonnes)
October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012
7.2% 3.4% US$133.1 billion US$165.7 billion 15.5 million 1.7 million
SHANGHAI Factory and Warehouse Aimed partly at stimulating Chinas domestic retail sales and ease lending for small and medium-sized businesses, the Chinese Central Bank lowered the reserve requirement ratio for banks twice in the review period between October 2011 and March 2012 by 50 basis points in November 2011 and another 50 basis points in February 2012. An estimated CNY800 billion was released into the market as a result. Thus, Shanghais economy managed to stay on the expansion path in the six months ending March 2012 in spite of the troubled global economy. In fact, Shanghais Purchasing Managers Index (PMI) for March 2012 outperformed Chinas national levels for the first time since May 2011, with a reading of 53.2, indicating that the citys manufacturing sector is in a recovery period. The lowering of the reserve requirement ratio for banks also facilitated the acquisition of land and ready-built industrial facilities. As a result, average land and capital values of industrial properties increased by about 4% and 12% respectively during the six-month review period ending March 2012. Notable land transactions done during this period include XCMGs acquisition of a 3.75 million sq ft plot in Fengxian district and AVIC Civil Aviation Electronics purchase of a 2.65 million sq ft industrial land parcel in the Minhang district. Likewise, average rental values achieved a 6.0% growth in the current six-month period. Increasing demand for industrial space
MAJOR TRANSACTIONS IN SHANGHAI TRANSACTIONS
from e-commerce businesses and multinational companies, which outpaced new supply, drove up occupancy rates and supported rental growth. Major leasing transactions sealed during the review period include Nissans lease of a 0.43 million sq ft warehouse facility in Songjiang district and KWEs lease of a 0.32 million sq ft warehouse in Pudong New Area. As Shanghai moves up the manufacturing value chain, traditional manufacturing activity is increasingly being phased out and is being replaced by high value, high-technology, research and development (R&D) and pharmaceutical activities. This is likely to result in some existing low end industrial facilities being withdrawn from the industrial stock when they are being redeveloped for more valuable uses. Coupled with the low pipeline supply of industrial space, the market is poised to remain tight, thus providing the impetus for the average land, capital and rental values to increase by up to 6% in the next 12 months. The medium to long term prospects of Shanghais industrial property market look bright too as it is likely to enjoy strong demand from occupiers and investors alike on the back of the Shanghai Municipal Governments target for Shanghai to achieve an average economic growth rate of 8% for the next five-year period from 2011.
Vailog Dianshan Lake GLP PVG Blogis Songjiang Minhang Fengxian
Warehouse Warehouse Warehouse Workshop Workshop
Lease Lease Lease Sale Sale
IHUSH KWE Nissan AVIC Civil Aviation Electronics XCMG
279,864 322,920 430,560 2,650,000 3,750,000
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H O N G KO N G S A R
ECONOMIC INDICATORS FOR HONG KONG SAR ECONOMIC INDICATORS
July - December 2011 September 2011 February 2012 September 2011 February 2012 September 2011 February 2012 September 2011 February 2012 September 2011 February 2012
3.62% -20.94% HK$1,858 billion HK$1,647 billion 11.8 million 1.9 million
HONG KONG SAR Factory The Government of Hong Kong announced in the 2012-13 Budget, two measures to incentivise the conversion from conventional industrial to data centre space necessary to support the sustainable growth of Hong Kongs traditional pillar industries like financial services, trading and logistics. First, fees for changing parts of eligible industrial buildings to data centre use will be exempted. Second, the premium payable for modifying land leases to allow high-tier data centre usage on industrial sites, will be assessed on the basis of actual development intensity and high-tier data centre use. Targeted to be implemented as early as mid-2012 for application until 31 March 2016, these measures are foreseen to boost the supply of data centre space in land-scarce Hong Kong while at the same time, facilitate the rejuvenation of old industrial estates. Similar to past quarters, the interest cost for vendors holding industrial premises remains low. Most of the vendors also remained firm on their asking prices in view of sustained occupational demand from tenants and stable rental income from their premises. On the prospective buyers front, the banks are more willing to offer them financing support for acquiring premises, which helped the recovery in the transaction volume during the second half of the review period. The number of strata-titled transactions plunged 30.2% quarteron-quarter (QoQ) to 956 in 4Q 2011 but rebounded by 35.7% QoQ to 1,297 in 1Q 2012. However, in view of the global economic uncertainties, more endusers are on tighter budgets for their business addresses. This has caused factory rental and capital value growth to slow down. During the period from October 2011 to March 2012, factory rents increased 3.6% to HK$9.00 per sq ft per month. Meanwhile, factory prices increased 3.3% to HK$2,630 per sq ft during the same period. Looking ahead, while the US economy has recently fared betterthan-expected and the Eurozone sovereign debt crisis has stabilised somewhat lately, the still-weak fundamentals of these advanced economies will continue to weigh on their import demand. Signs of negative spill-over to the Asian region have also been increasingly evident. Demand for industrial premises is thus anticipated to soften amid a deceleration of growth in local consumption and exports of goods and services. As such, average factory rents and prices are expected to decline 4% and 6%, respectively, over the coming 12 months. Warehouse The pace of external trade growth slowed significantly amidst a rocky global economic environment but remained positive over the review period. During the period from September 2011 to February 2012, re-exports increased 4.0% YoY to HK$1,619 billion, down from an increase of 10.2% YoY in the preceding six-month period. Nevertheless, the sustained outsourcing activities from retailers have translated into demand from third-party logistics companies (3PLs) for prime quality warehouses. This group of tenants is looking for ramp access warehouse premises in the range of 50,000 sq ft to 100,000 sq ft in size. Robust demand for warehousing facilities saw the average rents of cargo lift access warehouses increase by 9.3% to HK$7.45 per sq ft per month while those of ramp access warehouses increased 10.4% to HK$10.83 per sq ft per month during the current review period. Take-up for new warehousing facilities has been healthy. Interlink, a new logistics warehouse in Tsing Yi, which was officially opened in March 2012, is now almost fully leased to a range of well-known multinationals and 3PLs players, including Nippon Express. The next upcoming major logistics warehouse new supply will be two new projects also located in Tsing Yi, although the construction work is yet to start. Upon completion, the two projects will add a total of about 2.1 million sq ft of warehouse space to the market. In view of the uncertain external environment, warehouse rentals are anticipated to decrease 2% to 3% over the next 12 months while prices are expected to decline 4% to 5% during the same period.
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H O N G KO N G S A R
High-Specs Industrial Building Similar to the factory sector, uncertainties in the external environment hindered rental growth in the high-specs Industrial-Office buildings (I-O) sector. During the six-month period that ended March 2012, the average I-O rental increased 3.7% to HK$17.18 per sq ft per month.
MAJOR TRANSACTIONS IN HONG KONG SAR TRANSACTIONS
I-O rents are expected to decline 5% in the next 12 months if the global economic performance remains sluggish in the coming quarters.
Interlink Clifford Tower Dynamic Cargo Centre Joyce Building Big Orange - Kwai Chung
Warehouse Industrial Industrial Industrial Industrial
Lease Sale Sale Sale Sale
Nippon Express Sinociti Ltd Goodman Local investor Far East Consortium and Kosmopolito Hotels
270,000 76,368 87,822 89,157 158,000
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INDIA
ECONOMIC INDICATORS FOR INDIA ECONOMIC INDICATORS
September 2011 - February 2012 September 2011 - February 2012 September 2011 - February 2012 September 2011 - February 2012 October 2011 - March 2012 October 2011 - March 2012
6.9% 1.9% US$231.5 billion US$145.7 billion n.a. n.a.
NEW DELHI Factory and Warehouse Thanks to the moderation in Indias inflation rates, the Reserve Bank of India (RBI) has softened their monetary policy stance for the first time in one and a half years by reducing the Cash Reserve Ratio (CRR) of financial institutions in two tranches (i.e. 50 basis points in January 2012 and a further 75 basis points in March 2012). As a result, the CRR stood at 4.75% by the end of March 2012 from 6.0% in December 2011. The RBI recently also lowered its repo rate (i.e. the rate at which the Reserve Bank of India lends money to commercial banks) to 8% from 8.5% to boost Indias sagging economic growth. These measures have helped to stamp falling growth rates in Delhis industrial sector. The manufacturing sector, which accounts for over 75% of Indias Index of Industrial Production (IIP) displayed a healthy 4.0% expansion in February 2012, relative to the 1.4% growth in January 2012 and the low 2.6% growth in December 2011. Nevertheless, the average growth rate of the manufacturing sector remains at a low 1.9% over the six month period from September 2011 to February 2012, as compared to 8.3% in the same period a year ago. Despite a slowdown in Indias manufacturing sector, sentiments in Delhis industrial property market remained healthy on the back of continuous efforts by the government to develop and grow their industrial sector. For example, to encourage non-polluting small and medium scale industries to the capital, the Delhi State Industrial and Infrastructure Development Corporation (DSIIDC) is planning to set up a multi-level manufacturing hub in Rani Khera in north west Delhi
MAJOR TRANSACTIONS IN NEW DELHI TRANSACTIONS
with an estimated cost of INR 31 billion. The project is expected to generate 100,000 direct employment opportunities and 200,000 indirect employment opportunities. Additionally, to further improve basic infrastructure and amenities in industrial locations, the Delhi Government has recently called for bids to maintain some industrial estates under a Public Private Partnership (PPP) Model. Under this model, projects will be tendered on a build-operate-transfer system whereby concessionaires will redevelop the estates in two years and maintain it during the concession period. Thus, demand for Delhi/NCR industrial properties remained stable during the review period. Coupled with their limited supply, the average land and capital values as well as rents of Delhi/NCR industrial properties registered marginal increases of 1.5%, 0.6% and 1.1%, respectively, between October 2011 and March 2012. Recent sales transactions include Bhushan Steels purchase of a 144,000-sq ft factory at NH 24 and Jee Chemicals acquisition of a 100,000-sq ft factory at Bhiwadi while a notable lease transaction concluded in the review period was Eichers lease of a 100,000-sq ft factory at Palwal. With the continuous improvements in Delhis industrial infrastructure and the governments proactive approach in transforming Delhi into an advanced industrial hub, Delhi could emerge as an attractive investment destination in the coming years. This could fuel demand for industrial space to accommodate the growing businesses. Thus, average land, capital values and rents of the industrial properties are expected to grow by up to 4.4% in the next 12 months.
NH8 Palwal Bhiwadi Bhiwadi NH24
Warehouse Factory Warehouse Factory Factory
Lease Lease Sale Sale Sale
Om Pipes Eicher Swastik Jee Chemical Bhushan Steel
18,000 100,000 12,000 100,000 144,000
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I N D O N ES I A
ECONOMIC INDICATORS FOR JAKARTA ECONOMIC INDICATORS
January March 2012 January March 2012 October 2011 March 2012 October 2011 March 2012 January December 2011 October 2011 March 2012
1.4% -2.0% US$99.8 billion US$93.3 billion 5.6 million n.a.
JAKARTA Factory and Warehouse Indonesias large domestic market has shielded the country from the volatile global economic environment and has helped the economy to expand by 6.5% in 2011, its fastest pace since the Asian Financial Crisis in 1997. Continued economic growth coupled with low labour costs has paved the way for Indonesia to grow as an attractive destination for manufacturers. This has translated into a healthy demand for industrial land. While Japanese companies were still the major demand generator for industrial land in Jakarta, South Korean investors have also become quite active in searching for sizeable industrial land. In terms of the type of industries, the automotive and other related industries remain the major buyers. Other active industries include manufacturing, steel and related industries, pharmaceutical, logistics and building material industries. For example, during the review period, two undisclosed Japanese auto part makers each bought land at Delta Silicon. A number of automotive component companies have also recently bought land of various sizes in Suryacipta. There is, however, a lack of ready-to-use industrial land. Some industrial estates situated within strategic locations like Karawang or Bekasi have reported that they have had very limited land to sell throughout 2012 and this has triggered them to further increase their land prices. During the review period, land prices in these two regions went up by an average of 29.5%. Meanwhile, due to the small market size, rents and prices of industrial buildings recorded milder growths averaging 13.1% and 3.9% respectively in the six months ending March 2012. The Asian Development Bank (ADB) forecasts that Indonesias economic growth could slow marginally to 6.4% in 2012 from 6.5% in 2011 due to weaker external demand. Lagging development of infrastructure, especially in the transportation and energy sectors, also continues to be a major constraint to economic growth. Nonetheless, land and capital values as well as rents of industrial properties are expected to continue to post strong increases of up to 25% in the next 12 months on the back of robust demand and the scarcity of ready-to-use industrial land. Although some industrial estates are observed to be rushing to develop their land bank into ready-to-use industrial plots, new industrial land supply will only be ready in early 2013 given the time needed for the preparation works.
MAJOR TRANSACTIONS IN JAKARTA TRANSACTIONS

Modern Cikande MM2100 Delta Silicon Indotaisei Modern Cikande Modern Cikande Suryacipta Delta Silicon Delta Silicon
Land Land Land Land Land Land Land Land Land
Sale Sale Sale Sale Sale Sale Sale Sale Sale
Samotor Gas autoparts company (name undisclosed) Warehouse company Asahimas (glass) Jeewong (textile from Hong Kong) Mikakuto (confectionary from Japan) automotive component (name undisclosed) Japanese autoparts (name undisclosed) Japanese autoparts (name undisclosed)
269,098 301,389 312,153 312,153 322,917 322,917 322,917 333,681 355,209

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P. 13
I N D O N ES I A
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MAJOR TRANSACTIONS IN JAKARTA TRANSACTIONS

Suryacipta Suryacipta Jababeka Suryacipta Suryacipta Suryacipta Suryacipta Jababeka Suryacipta
Land Land Land Land Land Land Land Land Land
Sale Sale Sale Sale Sale Sale Sale Sale Sale
automotive component (name undisclosed) automotive component (name undisclosed) pharmacy (name undisclosed) automotive component (name undisclosed) plastic (name undisclosed) automotive component (name undisclosed) - #1 automotive component (name undisclosed) - #2 manufacturing & electronics (name undisclosed) automotive component (name undisclosed)
365,973 365,973 430,556 538,195 559,723 581,251 581,251 839,584 2,906,253
P. 14
JA PA N
ECONOMIC INDICATORS FOR GREATER TOKYO ECONOMIC INDICATORS
1) Nationwide 2) Tokyo port (Tokyo-kou, Narita) and Yokohama Port (Yokohama, Kawasaki, Yokosuka, Chiba and Kisarazu) 3) Tokyo custom and Yokohama custom 4) Narita Airport
July - December 2012 July - December 2012 July - December 2012 July - December 2012 July - December 2012 July - December 2012
-0.6%1) -3.9%1) 15.18 tillion2) 12.22 tillion2) 3.84 million3) 964,7064)
GREATER TOKYO Factory and Warehouse Japans economic progress in 2011 was affected by a series of unfavourable events including the Great East Japan (Tohoku) Earthquake, the appreciation of the Japanese Yen, the floods in Thailand, and the Eurozone debt crisis. Consequently, real GDP growth which contracted by 0.8% YoY in the first half of 2011, continued to contract in the second half of the year, albeit by a smaller margin of 0.6% YoY. While the quake in March 2011 and the resulting liquefaction have not led to major tenants relocating from the bay area to inland locations, weak leasing demand drove rents in some bay areas like Kawasaki and Yokohama to decline by 3.1% and 9.1% respectively during the six months ending March 2012. Although industrial land prices had declined for the seventh consecutive review period, the rate of decline was slower during the current October 2011 to March 2012 period, compared to six months earlier, amid signs of an improving economy. Supported by acquisition activities by both foreign and local property funds, capital values also showed greater stability during the review period with marginal declines recorded. The largest transaction involved the acquisition of 15 logistic facilities with a total gross floor area (GFA) of 8.3 million sq ft by a joint
MAJOR TRANSACTIONS IN GREATER TOKYO TRANSACTIONS
venture of Global Logistic Properties and China Investment Co. from LaSalle Investment Management for JPY122.6 billion. More than 90% of the total GFA is located within the Greater Tokyo and Osaka areas. Another significant transaction was Mapletree Logistic Trusts acquisition of seven logistic facilities for JPY17.5 billion. Of the aggregate GFA of 1.3 million sq ft, more than 70% is located in Greater Tokyo and 15% is in Greater Osaka and Greater Nagoya. Acquisitions by JREITs included IIF Investments acquisition of IIF Atsugi logistic centre in the Kanagawa prefecture for JPY2.29 billion and the Japan Logistics Fund, Inc.s purchase of Misato logistic centre in Saitama prefecture for JPY6.36 billion. In terms of new supply, Mitsubishi Estate Co. and Mitsui & Co. Ltd. completed a build-to-suit five-storey warehouse facility for Nakano Shokai Co. Ltd., a warehousing and logistic company with total GFA of 339,418 sq ft in the Koto ward in Tokyo during the review period. Prospects for the Japanese economy appear to be brighter, with the International Monetary Fund (IMF) forecasting real GDP growth of 2.0% and 1.7% for 2012 and 2013 respectively, up from the negative 0.7% growth for 2011. This is expected to lend support to rents, land prices and capital values, which are forecast to remain stable over the next 12 months.
IIF Atsugi Logistic Centre III Misato Logistic Centre Tsurugashima Logistic Centre Seven Logistic facilities (more than 70% located in Tokyo, 15% in Greater Osaka and Greater Nagoya) Three Logistic facilities located in Kawasaki 15 logistic facilities (more than 90% located in Greater Tokyo and Osaka)
Logistics Logistics Logistics Logistics Logistics Logistics
Sale Sale Sale Sale Sale Sale
IIF Investment Co. Japan Logistics Fund, Inc. Orix Real Estate Co. Mapletree Logistic Trust SPC of Fortress Investment Group The joint venture of Global Logistic Properties and China Investment Corporation
177,284 242,405 255,904 1,338,340 4,183,670 8,298,848
P. 15
NEW ZEALAND
ECONOMIC INDICATORS FOR NEW ZEALAND ECONOMIC INDICATORS
December 2011 December 2011 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012
1.4% 1.4% NZ$24.1 billion NZ$22.0 billion 39.6 million 104,471
AUCKLAND Office/Warehouse New Zealands economic recovery continues to be shallow, as delays in the Canterbury rebuild continue to dampen market activity. This is reflected in the marginal GDP growth of 0.3% YoY in 4Q 2011, compared to 0.7% YoY in the previous quarter. The shallow economic recovery slowed down industrial leasing activity, resulting in the overall industrial vacancy in Auckland rising marginally to 6% in February 2012 (latest available figures), from the 5.3% recorded in February 2011. Thus, industrial net rental rates across the greater Auckland region generally declined over the current review period from October 2011 to March 2012. Except for the Manukau submarket where net rents stayed constant, net rents of office / warehouse premises in the former Auckland City and North Shore submarkets saw declines of 0.7% and 1.2%, respectively over the review period. While rents eased over the six months to March 2012, land values saw a marginal upside of up to 0.7% during the review period. Land continues to be in limited supply particularly in the North Shore submarket, and what is available is tightly held. As a consequence, North Shore has the highest land values in the greater Auckland region. Capital values, on the other hand, were supported by the relatively active industrial sales market over the six months to the end of March 2012, rising by between 2.6% and 6.1% across the three submarkets. Industrial sales over NZ$2 million made up 50% of all commercial sales in the second half of 2011 in the greater Auckland region. A notable transaction was the sale of 36 - 50 Wilkinson Road in Penrose by Trevor Rands and a group of investors from APN Print Media for NZ$25.5 million. However, the rise in capital values against softer rents led prime industrial yields in the greater Auckland region to tighten over the review period from October 2011 to March 2012, most notably in the former Auckland City and Manukau City precincts. Going forward, prospects for the industrial sales market remained positive. Industrial investor confidence in Auckland has recorded the highest optimism since the inception of the Colliers Real Estate Confidence Survey in December 2008, with a net 51% of Auckland industrial investors who participated in the March 2012 survey forecasting improving conditions in the next 12 months, up from 41.0% six months earlier. As a result, land and capital values are forecast to rise over the next 12 months. However, prime rents and incentives are expected to remain static as leasing activity is forecast to stay soft on the back of the shallow economic recovery.
MAJOR TRANSACTIONS IN AUCKLAND TRANSACTIONS

2 - 8 Jarvis Way, East Tamaki 3 - 9 Westfield Place, Mt Wellington 41 Sir William Avenue, East Tamaki 87 - 89 Carbine Road, Mt Wellington 3 Rockridge Ave, Penrose 9 - 13 Sims Road, Penrose 99 Carbine Road, Mt Wellington 36 - 50 Wilkinson Road, Penrose 92 - 98 Harris Road, East Tamaki 59 Woodcocks Road, Warkworth 55 Hugo Johnston Drive, Penrose 525 Great South Road, Penrose
Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse
Lease Lease Lease Lease Lease Lease Lease Sale Sale Sale Sale Sale
Royal Wolf Trading New Zealand Mazda Motors LFA (NZ) Rentokil Initial Rilee Signs Loadlift Southern Pine Products Trevor Rands and Investors Direct Property Fund Private Investor Jerdi Partnership Akoranga Properties
279,291 83,076 44,896 20,451 18,729 18,697 18,439 527,431 279,861 68,717 43,508 46,780
P. 16
NEW ZEALAND
WELLINGTON Office/Warehouse The Christchurch earthquakes have led to significantly increased insurance premiums around New Zealand. This increased cost, typically passed on to tenants, has caused net rental rates in Petone and Seaview to fall by more than 3% in the current six-month review period to March 2012, and by 2.0% in Ngauranga. This marks the first decline in net rents in the Wellington industrial market since March 2010. Gross rents on the other hand (which includes all operating expenses) held relatively stable given that leasing activity gathered momentum over the six months ending March 2012. The largest leasing transaction that took place during the review period was the 60,278 sq ft secured by Wellington Regional Council at 201 Eastern Hutt Road for three years. While leasing activity has picked up, the majority of the industrial transactions during the second half of 2011 remains largely in the sub-NZ$2 million price bracket, totalling over NZ$35.5 million. A slight softening of yields during the October 2011 to March 2012
MAJOR TRANSACTIONS IN WELLINGTON TRANSACTIONS
period has led to capital values declining by between 8.4% and 8.6% across the three submarkets. Land values also declined over the past six months by 14.8% in Ngauranga and 16.0% in Petone. However, land values rose by 15.0% in Seaview. Overall investor confidence in Wellington continues to improve slowly with 11% of respondents remaining pessimistic in the March 2012 Colliers Real Estate Confidence Survey, as compared to 25% during the September 2011 survey. Although still recording the lowest level of confidence among the main centres in New Zealand, industrial investor confidence in Wellington is now in positive territory, with a net 2% of respondents indicating optimism for the next 12 months. However, earthquake issues surrounding the property market will continue to be a dampening factor in the Wellington industrial market in the near future. As a result, while land values are expected to stay stable in the next 12 months, capital values and net rents are projected to fall over the same period.
Unit 16, 27 Blenheim St, Upper Hutt Unit 2 & 3, 77 Port Road, Seaview Uniplas Building, 201 Eastern Hutt Road, Lower Hutt 4 - 6 Jackson Street & 20 Te Puni Street 57 Parkside Road, Lower Hutt 3 Broken Hill, Porirua
Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse
Lease Lease Lease Sale Sale Sale
Fuji Xerox New Zealand Forman Building Systems Wellington Regional Council Tom Hudig Trust Private Investor Takakopa Properties
16,146 42,777 60,278 26,651 33,906 34,401
P. 17
SINGAPORE
ECONOMIC INDICATORS FOR SINGAPORE ECONOMIC INDICATORS
October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012 October 2011 March 2012
2.6% 2.8% S$ 238.8 billion S$ 261.6 billion 15.2 million 933,843
SINGAPORE Factory and Warehouse The Government of Singapore introduced a slew of measures during the current review period between October 2011 and March 2012. These measures include disallowing the strata subdivision of industrial projects on selected state land parcels in the first 10 years after the completion of the project and specifying the minimum size of a unit in a multi-user industrial development at 1,615 sq ft. Developers selling industrial properties are also required by the authorities to stipulate the approved use of units sold in the purchase options and sales-and-purchase agreements. These measures should weed out unauthorised users and ensure industrial space caters to the needs of genuine industrialists. In so doing, it is hoped that runaway rents and prices of industrial space due to competition with unauthorised users can be prevented, resulting in market stability. Cautious expansion plans of industrialists on the back of the further moderation of Singapores economic growth to 2.6% YoY in the October 2011 to March 2012 period from the 3.6% YoY growth recorded in the preceding six-month period led to a lacklustre leasing market. Coupled with oncoming supply pressures, the gross monthly rents for factories in the central area inched up a mere 1.3% in the review period to average S$1.52 per sq ft per month by the end of March 2012, while the average gross monthly rents for warehouse space in the eastern part of the island stayed flat at S$1.44 per sq ft during the same period. In contrast, industrial investment and land sales activities remained robust, driven by institutional investors, especially REITs, as well as end-users who were looking to secure their own landed premises. Significant REIT purchases in the review period include Cambridge Industrial Trusts buy of a factory located on 16 Tai Seng Street for S$59.25 million as well as a warehouse at 3C Toh Guan Road East for S$35.5 million; and Cache Logistics Trusts purchase of Pan Asia Logistics Centre on 21 Changi North Way for S$35.18 million. These supported the continued uptrend in land and capital values albeit at a slower pace of between 5.1% and 13.5% during the current review period, down from 10.0% to 16.0% in the previous review period. According to the Urban Redevelopment Authority (URA), the stock of single-user factory space grew by a hefty 2.22 million sq ft in the current review period, up from 1.91 million sq ft in the previous six-month period. Developments completed in the six months ending March 2012 include Tiong Seng Contractors 187,290-sq ft Tiong Seng Prefab Hub at Tuas South Avenue 1, YHI Corporations 198,055-sq ft factory at 2 Pandan Road and CWTs 304,620-sq ft Pandan Logistics Hub along Pandan Road. Downside risks in the external environment such as the persistent Eurozone debt crisis, the sluggish recovery in the US and the weak growth momentum in Asia will continue to weigh on Singapore's economic growth going forward and expose companies in the manufacturing as well as the transport and storage sector to strong headwinds. However, these firms are expected to maintain their presence in Singapore so as to leverage Singapores Global-Asia positioning to tap into growth opportunities in Asia and the rest of the world. In addition, Singapores sound economic fundamentals should help the country and the industrial market ride through the current uncertainties. Hence, while Singapores industrial land, capital values and rents will likely soften in the next 12 months, the fall is expected to be capped at 3%.
High-Specs Industrial Building On top of slowing occupier demand from industrialists as they cut back on expansion and capital investment plans, the high-specs industrial sector also suffered from easing spill-over demand from the office sector in line with its falling rents and rising stock of suburban office space. Coupled with ample supply in the pipeline, the rents for high-specs industrial space stood at S$3.50 per sq ft per month, based on a new basket of high-specs spaces tracked. However, in the prime central locality, some high-specs industrial space could still command a strong rent of about S$3.80 to S$4.00 per sq ft while business parks could achieve S$4.50 to S$5.00 per sq ft. Notwithstanding the global uncertainties and the near-term pressure on rents, REITs took advantage of the low interest rate environment to secure yield accretive purchases. For example, in February 2012, Ascendas REIT bought four high-specs buildings located in the
P. 18
SINGAPORE
Singapore Science Park Cintech I, II, III and IV for a collective sum of S$183.00 million. This comes shortly after their announcement in December 2011 that they have acquired two properties, namely Corporation Place at 2 Corporation Road and 3 Changi Business Park Vista for a combined S$179 million. Although overriding caution in the industrial property sector is expected to weigh on current market sentiments, demand for
MAJOR TRANSACTIONS IN SINGAPORE ECONOMIC INDICATORS
high-specs industrial space could be shored up by, among other factors, expansion in research and development functions as well as the setting up of new high-value information and communication technology, bio-medical and digital media outfits. This should help to limit the dip in overall high-specs industrial rents to 3% for the whole of 2012.
Mapletree Business City, 20 & 30 Pasir Panjang Road Mapletree Business City, 20 & 30 Pasir Panjang Road UE Bizhub East, 6 & 8 Changi Business Park Avenue 1 1,3,5,7,9,11 Howard Road 25 Pioneer Crescent 7 Ubi Close 6 Woodlands Loop 16 Tai Seng Street 31 Admiralty Road 3C Toh Guan Road East 21 Changi North Way 3 Changi Business Park Vista Cintech I, II, III, IV Corporation Place, 2 Corporation Road
High-Specs High-Specs High-Specs Factory Factory Factory Factory Factory Warehouse Warehouse Warehouse High-Specs High-Specs High-Specs
Lease Lease Lease Sale Sale Sale Sale Sale Sale Sale Sale Sale Sale Sale
Samsung Asia Toshiba Cisco Systems Dairy Industries Cambridge Industrial Trust Alpine Motors Sabana REIT Cambridge Industrial Trust Storhub Cambridge Industrial Trust Cache Logistics Trust Ascendas REIT Ascendas REIT Ascendas REIT
80,000 52,000 110,000 75,393 76,003 76,596 77,544 213,965 137,187 192,864 196,988 197,927 583,522 824,902
P. 19
TA I WA N
ECONOMIC INDICATORS FOR TAIWAN ECONOMIC INDICATORS
October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012 October 2011 - March 2012
0.63% -2.15% US$131.9 billion US$146.5 billion 6.7 million 821,946
TAIWAN High-Specs Industrial Building Taiwans GDP growth rate slowed further to 0.6% YoY for the period between October 2011 and March 2012, compared to the 4.2% YoY recorded during the preceding six months ending September 2011. Over the same period under review, the manufacturing sector contracted by about 2.2% YoY, on the back of declines in the output value of electronic components, chemical materials, basic metals and machinery equipment. Against the weaker economic backdrop, the expansion in net takeup of high-specs space in Neihu Technology Park fell by a hefty 59.6% to just 292,930 sq ft for the period between October 2011 and March 2012, from the 725,049 sq ft recorded for the previous review period. Major leasing deals that took place during the review period included Nestle Taiwan Co. Ltd, Satellite Television Asia Region Ltd, Taiwan Branch, E-Ten Information Systems Co. Ltd and Jollywiz Digital Technology Co. Ltds take-up of 49,812 sq ft in Union Freedom Plaza, 46,254 sq ft in Tokyo Technology Headquarters (A), 28,464 sq ft in Yang Ming Neihu Building and 17,790 sq ft in Guang Yuan Technology Building, respectively. Notwithstanding the marked slowdown in demand growth, the average rents of high-specs space in Neihu Technology Park managed to gain another 0.9% over the review period from NT$31.57 per sq ft per month in September 2011 to NT$31.86 per sq ft per month in March 2012. This came on the back of the continued fall in vacancy rate by 0.7 percentage points to 11.6% as of March 2012,
MAJOR TRANSACTIONS IN TAIPEI TRANSACTIONS
the lowest level since 4Q 2008. The persistent tightening of the vacancy rate, in turn, was the result of continued growth in demand amid limited new completions. Only one new project was completed during the review period. The completion of the 120,865-sq ft S.I.T. Wanguo Centre in 1Q 2012, raised the total stock of high-specs space in Neihu Technology Park by just 0.4% to about 28.4 million sq ft as of March 2012. On the investment front, the review period saw several transactions for investment and owner-occupation purposes. Major transactions included Delta Electronics Inc.s acquisition of the 263,292-sq ft Eten Neihu Building for NT$2.53 billion, Mercuries Life Insurance Co. Ltds acquisition of the 120,865-sq ft S.I.T. Wanguo Centre for NT$2.47 billion, TransAsia Airways Co. Ltds acquisition of the 42,583-sq ft Green Energy Headquarters for NT$704 million and Taiwan Secom Co. Ltds acquisition of the 28,262-sq ft Green Energy Headquarters for NT$487 million. Going forward, the Eurozone crisis and deceleration of Chinas economic growth is expected to affect Taiwans economic growth and impact demand for high-specs space in Neihu Technology Park. And with more new high-specs space expected to enter the market in the next 12 months, this may place some upward pressure on the vacancy rate. As such, rents are forecast to remain flat over the next 12 months.
Guang Yuan Technology Building Yang Ming Neihu Building Tokyo Technology Headquarters(A) Union Freedom Plaza Green Energy Headquarter Green Energy Headquarter S.I.T. Wanguo Centre Eten Neihu Building
High-Specs High-Specs High-Specs High-Specs High-Specs High-Specs High-Specs High-Specs
Lease Lease Lease Lease Sale Sale Sale Sale
Jollywiz Digital Technology Co. Ltd E-TEN Information Systems Co. Ltd Satellite Television Asia Region Ltd, Taiwan Branch Nestle Taiwan Co. Ltd Taiwan Secom Co. Ltd TransAsia Airways Co. Ltd Mercuries Life Insurance Co. Ltd Delta Electronics, Inc.
17,790 28,464 46,254 49,812 28,262 42,583 120,865 263,292
P. 20
INTERNATIONAL COMPARISON
The purpose of the International Comparison tables is only to facilitate easy and equal comparison of single-user industrial costs. However, payment schemes vary with each country. Some countries may have the practice of paying annual land rent, while others pay a lump sum land premium or through other modes. Colliers International does not infer that industrial land and buildings in these cities may be acquired through the same schemes or on the basis stated in the table.
SINGLE-USER WAREHOUSE SINGLE-USER WAREHOUSE LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS
VALUE AS OF MARCH 2012 (US$) CITY LAND VALUE1 (PSF) CAPITAL VALUE2 (PSF) MONTHLY GROSS RENT (PSF) 0.57 0.56 0.64 0.50 0.44 1.64 2.10 3.08 2.26 2.00 0.50 1.39 0.96 0.61 0.99 0.51 0.50 0.22 0.30 0.45 0.61 0.38 0.90 0.71 0.62 1.32 1.31 0.78 1.21 0.56 0.50 0.47 12-MONTH FORECAST (US$) LAND VALUE1 (PSF) CAPITAL VALUE2 (PSF) MONTHLY GROSS RENT (PSF) 0.59 0.58 0.66 0.52 0.46 1.64 2.10 3.08 2.26 1.91 0.52 1.37 0.93 0.62 1.00 0.51 0.50 0.25 0.32 0.47 0.63 0.40 0.91 0.73 0.65 1.28 1.34 0.79 1.23 0.54 0.48 0.46 BASIS OF LAND AND CAPITAL VALUES LAND TENURE (YEARS) PLOT RATIO LAND AREA (SQ FT) GROSS FLOOR AREA (SQ FT) 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000
Auckland3 Former Auckland City Manukau North Shore Beijing Tianzhu Tongzhou Greater Tokyo4 Chiba - Urayasu Kawasaki - Higashi Ogishima Tokyo - Ariake Tokyo - Heiwajima Tokyo - Shinsuna Yokohama - Daikokufuto Guangzhou GETDD Hong Kong5 Ramp Access Cargo Lift Access Jakarta Bekasi Melbourne East & Southeast Fringe North West New Delhi Delhi - NH1 Delhi - NH8 Delhi - NH24 Delhi - East Delhi - North Delhi - South Delhi - West Shanghai Pudong New Area Singapore East Sydney South Southwest West Wellington3 Ngauranga Petone Seaview 32.74 33.08 18.12 69.43 62.78 55.97 32.74 33.08 18.12 67.41 60.96 54.34 60 60 60 1.0 1.0 1.0 100,000 100,000 100,000 80.77 18.02 31.87 156.38 98.45 144.51 80.77 18.02 31.87 160.09 100.64 145.32 60 60 60 1.0 1.0 1.0 100,000 100,000 100,000 68.26 181.68 68.26 176.54 60 1.0 100,000 50.90 74.24 51.40 80.40 60 1.0 100,000 18.04 23.04 35.81 93.60 144.62 171.18 181.03 19.94 39.88 63.53 76.24 76.24 61.94 18.04 22.90 35.39 97.29 150.07 178.57 183.50 20.60 42.54 64.80 77.51 77.51 63.28 60 60 60 60 60 60 60 1.0 1.0 1.0 1.0 1.0 1.0 1.0 100,000 100,000 100,000 100,000 100,000 100,000 100,000 14.99 44.45 12.87 11.29 74.41 144.47 67.64 53.39 15.15 44.88 13.00 11.40 75.15 145.92 68.32 53.92 60 60 60 60 1.0 1.0 1.0 1.0 100,000 100,000 100,000 100,000 16.26 25.98 19.67 27.28 60 1.0 100,000 369.53 349.85 354.75 332.36 60 60 1.0 1.0 100,000 100,000 9.54 50.10 9.58 51.83 60 1.0 100,000 37.31 124.42 131.11 169.75 16.13 184.57 236.37 306.25 282.86 168.06 37.31 124.42 131.11 169.75 16.13 184.57 236.37 306.25 282.86 168.06 60 60 60 60 60 60 1.0 1.0 1.0 1.0 1.0 1.0 100,000 100,000 100,000 100,000 100,000 100,000 19.92 11.64 88.42 67.45 20.43 11.93 90.99 69.60 60 60 1.0 1.0 100,000 100,000 19.63 18.70 26.73 82.56 80.98 97.47 19.92 18.92 26.82 85.44 83.81 100.89 60 60 60 1.0 1.0 1.0 100,000 100,000 100,000
1. Land values are expressed in US$ psf per plot ratio 2. Capital values refer to the values of both land and building 3. Rental series for Auckland and Wellington are on a net basis 4. The Urayasu submarket remained flooded. Land, capital values and rents are not available 5. Values provided are for multi-user warehouse buildings
P. 21
INTERNATIONAL COMPARISON OF WAREHOUSE LAND VALUES (MARCH 2012)
Delhi-West Delhi - West Delhi - South Delhi-South Greater Tokyo-Tokyo-Shinsuna Greater Tokyo - Tokyo - Shinsuna Delhi-North Delhi - North Greater Tokyo-Tokyo-Heiwajim Greater Tokyo - Tokyo - Heiwajimaa Greater Tokyo-Tokyo-Ariake Greater Tokyo - Tokyo - Ariake Delhi-East Delhi - East Sydney-South Sydney - South Singapore-East Singapore - East Shanghai-Pudong New Area Shanghai - Pudong New Area Melbourne-Fringe Melbourne - Fringe Greater Tokyo - Kawasaki - Higashi Ogishima Greater Tokyo-Kawasaki-Higashi Ogishima Delhi-NH24 Delhi - NH 24 Wellington - Petone Wellington-Petone Wellington - Ngauranga Wellington-Ngauranga Sydney - West Sydney-West Auckland - North Shore Auckland-North Shore Delhi-NH8 Delhi - NH 8 Beijing-Tianzhu Beijing - Tianzhu Auckland-Former Auckland City Auckland - Former Auckland City Auckland - Manukau Auckland-Manukau Wellington - Seaview Wellington-Seaview Delhi-NH1 Delhi - NH 1 Sydney-Southwest Sydeny - Southwest Jakarta-Bekasi Jakarta - Bekasi Greater Tokyo-Yokohama-Daikokufuto Greater Tokyo - Yokohama - Daikokufuto Melbourne-East & South East Melbourne - East & South East Melbourne-North Melbourne - North Beijing-Tongzhou Beijing - Tongzhou Melbourne-West Melbourne - West Guangzhou-GETDD Guangzhou - GET DD 0 50 100 Warehouse Land Values (US$ psf per plot ratio) Warehouse Land Values (US$ psf per plot ratio) 150 200
INTERNATIONAL COMPARISON OF WAREHOUSE CAPITAL VALUES (MARCH 2012)

Ho ng Kong--Ra mp Acces s* Hong Kong Ramp Access* Ho ng Kong--Carg o Lift Acces s* Hong Kong Cargo Lift Accees* Grea ter Tokyo-Tokyo-He iwajima Greater Tokyo - Tokyo - Heiwajima Grea ter Tokyo-Tokyo-Shinsu na Greater Tokyo - Tokyo - Shinsuna Greater Tokyo - Tokyo - Ariake Grea ter Tokyo-Tokyo-Ariake Greater Tokyo-Kawasa ki-Hig as hi Ogishima Grea ter Tokyo - Kawasaki - HigashiOgi sh ima Sing ap ore-East Singapore - East Grea ter Tokyo - Yokohama -Daikokufuto Greater Tokyo-Yokoha ma - Daikokufuto Sydney - South Sydney-South Sydney - West Sydney-Wes t Me lbourne-Fringe Melbourne - Fringe Sydney-Southwest Sydeny - Southwest Auckland - North Shore Auckland-North Shore Beijing - Tian zhu Beijing- Tianzhu Auckland - Former Auckland City Auckland-Forme r Auckland Auckland - Manukau Auckland-Man ukau Delhi - South De lhi-South De lhi-North Delhi - North Me lbourne-East & South Eas t Melbourne - East & South East Shanghai - Pudong New Shan gh ai-Pudong New Area Wellingt on-Nga uran ga Wellington - Ngauranga Me lbourne-North Melbourne - North Beijing- Tongzhou Beijing -Tong zhou De lhi-East Delhi - East Wellingt on-Petone Wellington - Petone De lhi-West Delhi - West Wellingt on-Sea view Wellington - Seaview Me lbourne-West Melbourne - West Gu an gz hou-GETDD Guangzhou - GET DD De lhi-NH24 Delhi - NH 24 Jakarta-Bekasi Jakarta - Bekasi De - NH 8 Delhilhi-NH8 05 0 01 50 00 100 1502 150 00 200 2503 250 00 300 35 04 350 00 400
Warehous e Capital Values (U S$ psf) Warehouse Capital Values (US$ psf)
* Values provided are for multi-user warehouse buildings
P. 22
INTERNATIONAL COMPARISON OF WAREHOUSE MONTHLY GROSS RENTS (MARCH 2012)
Greater Tokyo - Tokyo - Heiwajima Greater Tokyo-Tokyo-Heiwajima Greater Tokyo - Tokyo - Shinsuna Greater Tokyo-Tokyo-Shinsuna Greater Tokyo - Tokyo - Ariake Greater Tokyo-Tokyo-Ariake Greater Tokyo - Yokohama - Daikokufuto Greater Tokyo-Yokohama-Daikokufuto Greater Tokyo - Kawasaki - Higashi Ogishima Greater Tokyo-Kawasaki-Higashi Ogishima Hong Kong - Ramp Access* Hong Kong-Ramp Singapore - East Singapore-East Sydney - South Sydney-South Sydney - West Sydney-West Melbourne-Fringe Melbourne - Fringe Hong Kong - Cargo Lift Accees* Hong Kong-Cargo Lift Access* Delhi - South Delhi-South Sydney-Southwest Sydeny - Southwest Delhi - West Delhi-West Auckland - North Shore** Auckland-North Shore** Shanghai-Pudong Shanghai - Pudong New Area Delhi - East Delhi-East Melbourne-East & South East Melbourne - East & South East Auckland-Former AucklandCity** Auckland - FormerAuckland City** Auckland - Manukau** Auckland-Manukau** Wellington-Ngauranga** Wellington - Ngauranga** Melbourne-North Melbourne - North Beijing - Tianzhu Beijing-Tianzhu Melbourne-West Melbourne - West Guangzhou-GETDD Guangzhou - GET DD Wellington-Petone** Wellington - Petone** Wellington-Seaview** Wellington - Seaview** Delhi-NH24 Delhi - NH 24 Beijing-Tongzhou Beijing - Tongzhou Delhi-North Delhi - North Delhi-NH8 Delhi - NH 8 Delhi-NH1 Delhi - NH 1 0.00 0.00 0.50 0.50 1.00 1.00 1.50 1.50 2.00 2.00 2.50 2.50 3.00 3.00 3.50 3.50 Warehouse Monthly Gross Rents (US$ psf) Warehouse Monthly Gross Rents (US$ psf)
* Values provided are for multi-user factory buildings ** Rents provided are net rents
P. 23
SINGLE-USER FACTORY SINGLE-USER FACTORY LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS
VALUE AS OF MARCH 2012 (US$) CITY LAND VALUE1 (PSF) CAPITAL VALUE2 (PSF) MONTHLY GROSS RENT (PSF) 1.39 0.74 0.48 0.94 1.15 1.39 0.37 0.61 0.99 0.51 0.50 0.23 0.30 0.43 0.63 0.37 0.86 0.71 0.46 0.44 1.33 12-MONTH FORECAST (US$) LAND VALUE1 (PSF) CAPITAL VALUE2 (PSF) MONTHLY GROSS RENT (PSF) 1.45 0.77 0.49 0.90 1.10 1.34 0.41 0.62 1.00 0.51 0.50 0.23 0.30 0.47 0.65 0.40 0.90 0.73 0.49 0.45 1.31 BASIS OF LAND AND CAPITAL VALUES LAND TENURE (YEARS) PLOT RATIO LAND AREA (SQ FT) GROSS FLOOR AREA (SQ FT) 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000
Beijing Shang Di Yi Zhuang Greater Tokyo Chiba - Ichikawa Chiba - Mihama Saitama - Ageo Tokyo - Ota Yokohama - Naka Guangzhou GETDD Hong Kong3 Low Quality Mid Quality Prime Quality Jakarta Bekasi Karawang Melbourne East & South East Fringe North West New Delhi Delhi - NH1 Delhi - NH8 Delhi - NH24 Delhi - East Delhi - North Delhi - South Delhi - West Shanghai Minhang District Pudong New Area Singapore Central 96.56 181.78 96.56 176.74 60 1.0 100,000 21.15 23.10 58.04 55.40 21.70 23.40 60.47 58.67 60 60 1.0 1.0 100,000 100,000 17.03 17.03 34.05 89.96 142.62 155.70 171.85 19.94 38.28 66.07 76.24 86.40 70.90 17.03 17.68 35.36 91.11 143.87 161.47 173.00 21.20 40.31 71.08 79.71 93.00 73.07 60 60 60 60 60 60 60 1.0 1.0 1.0 1.0 1.0 1.0 1.0 100,000 100,000 100,000 100,000 100,000 100,000 100,000 14.99 44.45 12.87 11.29 74.41 144.47 67.64 53.39 15.15 44.88 13.00 11.40 75.15 145.92 68.32 53.92 60 60 60 60 1.0 1.0 1.0 1.0 100,000 100,000 100,000 100,000 16.26 12.26 31.88 27.82 19.67 15.37 33.48 29.21 60 60 1.0 1.0 100,000 100,000 251.69 314.81 449.75 236.59 295.93 422.77 60 60 60 1.0 1.0 1.0 100,000 100,000 100,000 9.54 50.10 9.58 51.83 60 1.0 100,000 37.43 18.57 13.88 73.22 36.26 133.74 82.84 77.78 142.02 117.68 37.43 18.57 13.88 73.22 36.26 133.74 82.84 77.78 142.02 117.68 60 60 60 60 60 1.0 1.0 1.0 1.0 1.0 100,000 100,000 100,000 100,000 100,000 60.03 8.61 153.19 70.82 61.69 8.82 157.77 72.88 60 60 1.0 1.0 100,000 100,000
1. Land values are expressed in US$ psf per plot ratio 2. Capital values refer to the values of both land and building 3. Values provided are for multi-user factory buildings
P. 24
INTERNATIONAL COMPARISON OF FACTORY LAND VALUES (MARCH 2012)
Delhi - West Delhi-West Delhi - South Delhi-South Delhi - North Delhi-North Singapore - Central Singapore-Central Delhi - East Delhi-East Greater Tokyo - Tokyo - Ota Greater Tokyo-Tokyo-Ota Beijing - Shanghai Di Beijing-Shang Melbourne - Fringe Melbourne-Fringe Greater Tokyo - Chiba - Ichikawa Greater Tokyo-Chiba-Ichikawa Greater Tokyo - Yokohama - Naka Greater Tokyo-Yokohama-Naka Delhi - NH 24 Delhi-NH24 Shanghai - Pudong New Area Shanghai-Pudong New Area Shanghai - Minhang District Shanghai-Minhang District Greater Tokyo - Chiba - Mihama Greater Tokyo-Chiba-Mihama Delhi - NH 8 Delhi-NH8 Delhi - NH 1 Delhi-NH1 Jakarta - Bekasi Jakarta-Bekasi Melbourne - East & South East Melbourne-East & South East Greater Tokyo - Saitama - Ageo Greater Tokyo-Saitama-Ageo Melbourne - North Melbourne-North Jakarta-Karawang Jakarta - Karawang Melbourne - West Melbourne-West Guangzhou - GET DD Guangzhou-GETDD Beijing - Yi Zhuang Beijing-Yi Zhuang 0 0 50 100 Factory Land Values (US$ psf per plot ratio) Factory Land Values (US$ psf per plot ratio) 150 200
INTERNATIONAL COMPARISON OF FACTORY CAPITAL VALUES (MARCH 2012)

Hong Kong-Prime Quality* Hong Kong - Prime Quality* Hong Kong-Mid Hong Kong - Mid Quality* Hong Kong-Low Hong Kong - Low Quality* Singapore-Central Singapore - Central Beijing-Shang Di Beijing - Shang Di Melbourne-Fringe Melbourne - Fringe Greater Tokyo-Tokyo-Ota Greater Tokyo - Tokyo - Ota Greater Tokyo-Chiba-Ichikawa Greater Tokyo - Chiba - Ichikawa Greater Tokyo-Yokohama-Naka Greater Tokyo - Yokohama - Naka Delhi-South Delhi - South Greater Tokyo-Chiba-Mihama Greater Tokyo - Chiba - Mihama Greater Tokyo - Saitama - Ageo Greater Tokyo-Saitama-Ageo Delhi - North Delhi-North Melbourne-East Melbourne - East & South East Delhi-West Delhi - West Beijing-Yi Zhuang Beijing - Yi Zhuang Melbourne-North Melbourne - North Delhi-East Delhi - East Shanghai-Minhang Shanghai - Minhang District Shanghai-Pudong Shanghai - Pudong New Area Melbourne - West Melbourne-West Guangzhou - GET DD Guangzhou-GETDD Delhi-NH24 Delhi - NH 24 Jakarta-Bekasi Jakarta - Bekasi Jakarta-Karawang Jakarta - Karawang Delhi - NH 8 Delhi-NH8 0 0 50 50 100 150 200 250 250 300 350 400 450 500
Factory Capital Values (US$ psf) Factory Capital Values (US$ psf)
* Values provided are for multi-user factory buildings
P. 25
INTERNATIONAL COMPARISON OF FACTORY MONTHLY GROSS RENTS (MARCH 2012)
Hong Kong-Prime Quality* Hong Kong - Prime Quality* Beijing-Shang Beijing - Shanghai Di Singapore-Central Singapore - Central Hong Kong-Mid Quality* Hong Kong - Mid Quality* Melbourne-Fringe Melbourne - Fringe Hong Kong-Low Quality* Hong Kong - Low Quality* Delhi-South Delhi - South Beijing-Yi Zhuang Beijing - Yi Zhuang Delhi-West Delhi - West Delhi-East Delhi - East Melbourne-East & South East Melbourne - East & South East Melbourne-North Melbourne - North Melbourne-West Melbourne - West Guangzhou - GET DD Guangzhou-GETDD Shanghai-Minhang Shanghai - Minhang District Shanghai-Pudong New Area Shanghai - Pudong New Area Delhi-NH24 Delhi - NH 24 Jakarta-Karawang Jakarta - Karawang Delhi-North Delhi - North Delhi-NH8 Delhi - NH 8 Delhi-NH1 Delhi - NH 1 0.00 0.50 0.50 1.00 1.50 1.50
Factory Monthly Gross Rents (US$ psf) Factory Monthly Gross Rents (US$ psf)
* Values provided are for multi-user factory buildings
P. 26
MULTI-USER HIGH-SPECS MULTI-USER HIGH-SPECS AVERAGE MONTHLY GROSS RENTS
AS OF MARCH 2012 12-MONTH FORECAST AVERAGE MONTHLY GROSS RENT (US$ PSF) 1.51 2.10 1.73 0.27 0.45 0.53 0.82 0.53 1.08 0.86 1.41 2.70 1.18 1.08 3.41 4.43 3.41 LEASE TERM (YEARS) 3 3 3 3 to 9 3 to 9 3 to 9 3 to 9 3 to 9 3 to 9 3 to 9 3 to 9 3 3 3 3 3 3 BASIS OF RENTAL RATES LOCATION Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban Suburban NET FLOOR AREA (SQ FT) 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 RENT FREE PERIOD (MONTH) 1 1 1 Negotiable Negotiable Negotiable Negotiable Negotiable Negotiable Negotiable 1 1 1 1 1 1 1
CITY
Beijing Hong Kong Melbourne New Delhi - NH1 New Delhi - NH8 New Delhi - NH24 New Delhi - East New Delhi - North New Delhi - South New Delhi - West Shanghai Singapore1 Sydney Taipei - Neihu Technology Park Greater Tokyo - Hakusan Greater Tokyo - Kanagawa Greater Tokyo - Yokohama
AVERAGE MONTHLY GROSS RENT (US$ PSF) 1.45 2.21 1.73 0.27 0.43 0.51 0.78 0.53 1.04 0.84 1.36 2.78 1.18 1.08 3.41 4.43 3.41
1. With effect from May 2012, the basket used to compute Singapores high-specs industrial rents has been expanded to include an array of both independent high-specs industrial buildings and business parks.
INTERNATIONAL COMPARISON OF HIGH-SPECS MONTHLY GROSS RENTS (MARCH 2012)
Greater Tokyo --Kanagawa Greater Tokyo Kanagawa Greater Tokyo -- Yokohama Greater Tokyo Yokohama Greater Tokyo --Hakusan Greater Tokyo Hakusan Singapore Singapore Hong Kong Hong Kong Melbourne Melbourne Beijing Beijing Shanghai Shanghai Sydney Sydney Taipei Neihu Technology Park Taipei --Neihu Technology Park New Delhi South New Delhi --South New Delhi West New Delhi -- West New Delhi East New Delhi --East New Delhi North New Delhi --North New Delhi NH 24 New Delhi - - NH24 New Delhi NH 8 New Delhi - - NH8 New Delhi NH 1 New Delhi - - NH1 0.00 0.00 0.50 1.00 1.00 1.50 1.50 2.00 2.50 3.00 3.50 3.50 4.00 4.50 4.50 5.00
High-Specs Average Monthly Gross Rents (US$ psf) High-Specs Average Monthly Gross Rents (US$ psf)
P. 27
LOCAL MARKET NORM
The purpose of the Local Market Norm tables is only to provide an understanding of single-user industrial costs in the context of the various submarkets. The land tenure, plot ratio, land and building size quoted are based on recent offerings and transactions in each local market. However, payment schemes vary with each country. Some countries may have the practice of paying annual land rent, while others pay a lump sum land premium or through other modes. Colliers International does not infer that industrial land and buildings in these cities may be acquired through the same schemes.
SINGLE-USER WAREHOUSE SINGLE-USER WAREHOUSE LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS1
IN LOCAL CURRENCY AS OF MARCH 2012 CITY LOCAL CURRENCY LAND VALUE2 (PSF) CAPITAL VALUE3 (PSF) MONTHLY GROSS RENT (PSF) 0.82 0.76 0.83 3.12 2.78 93.00 157.00 169.00 149.00 132.00 IN US$ AS OF MARCH 2012 LAND VALUE2 (PSF) CAPITAL VALUE3 (PSF) MONTHLY GROSS RENT (PSF) 0.67 0.62 0.67 0.50 0.44 1.13 1.90 2.05 1.81 1.60 BASIS OF LAND, CAPITAL VALUES AND MONTHLY GROSS RENTS (LOCAL MARKET NORM) LAND TENURE (YEARS) PLOT RATIO LAND AREA (SQ FT) GROSS FLOOR AREA (SQ FT) 15,000 50,000 52,500 105,000 108,000 107,640 3,229,170 215,278 4,843,755 430,556 430,556
Auckland4 Former Auckland City Manukau North Shore Beijing Tianzhu Tongzhou Greater Tokyo5 Chiba-Urayasu Kawasaki - Higashi Ogishima Tokyo - Ariake Tokyo - Heiwajima Tokyo - Shinsuna Yokohama Daikokufuto Guangzhou GETDD Hong Kong6 Ramp Access Cargo Lift Access Jakarta Bekasi Melbourne East & South East Fringe North West New Delhi Delhi - NH1 Delhi - NH8 Delhi - NH24 Delhi - East Delhi - North Delhi - South Delhi - West Shanghai Pudong New Area Singapore East Sydney South Southwest West A$ A$ A$ 89.25 24.39 32.60 158.25 126.20 126.30 1.10 0.79 0.90 92.84 25.37 33.91 164.61 131.27 131.38 1.14 0.82 0.93 Freehold Freehold Freehold 1.2 1.2 1.2 220,000 60,000 430,000 264,000 72,000 516,000 S$ 88.47 198.62 1.44 70.37 157.99 1.15 30+30 2.5 120,000 300,000 CNY 286.06 436.72 3.90 45.45 69.38 0.62 50 0.6 150,000 90,000 Rs Rs Rs Rs Rs Rs Rs 1,300.00 1,660.00 2,580.00 7,600.00 10,880.00 13,900.00 14,700.00 1,500.00 3,000.00 5,000.00 6,000.00 6,000.00 4,875.00 13.00 18.00 27.00 37.00 23.00 54.00 43.00 25.41 32.45 50.43 148.56 212.68 271.72 287.35 29.32 58.64 97.74 117.29 117.29 95.30 0.25 0.35 0.53 0.72 0.45 1.06 0.84 99 99 99 Freehold Freehold Freehold Freehold 0.6 0.6 0.6 0.6 0.6 0.6 0.6 15,000 15,000 15,000 5,000 15,000 10,000 7,000 9,000 9,000 9,000 3,000 9,000 6,000 4,200 A$ A$ A$ A$ 19.74 58.53 16.95 14.86 102.19 213.68 92.90 78.97 0.66 1.12 0.54 0.56 20.53 60.88 17.63 15.46 106.30 222.27 96.63 82.14 0.69 1.17 0.56 0.58 Freehold Freehold Freehold Freehold 0.6 0.6 0.6 0.6 40,000 30,000 40,000 30,000 24,000 18,000 24,000 18,000 Rp 139,321.00 204,461.00 14.39 21.12 30 2.4 10,000 24,000 HK$ HK$ 2,869.20 2,716.40 10.83 7.45 369.53 349.85 1.39 0.96 N.A N.A N.A N.A N.A N.A N.A N.A CNY 56.67 269.50 2.85 9.00 42.82 0.45 50 1.5 150,000 225,000 JPY JPY JPY JPY JPY JPY 2,957.00 13,493.00 9,479.00 16,656.00 1,847.00 12,170.00 21,646.00 19,416.00 22,203.00 13,192.00 35.88 163.71 115.01 202.09 22.41 147.66 262.63 235.57 269.39 160.06 Freehold Freehold Freehold Freehold Freehold Freehold 2.0 2.0 2.0 2.0 2.0 2.0 53,820 1,076,390 107,639 1,614,585 215,278 107,639 CNY CNY 112.95 67.83 520.16 396.75 17.94 10.78 82.64 63.03 50 50 0.7 0.9 150,000 120,000 NZ$ NZ$ NZ$ 32.90 27.56 39.41 155.40 141.55 159.02 26.89 22.53 32.21 127.01 115.69 129.97 Freehold Freehold Freehold 0.5 0.5 0.5 30,000 100,000 105,000
Continued on next page >
P. 28
LOCAL MARKET NORM

< Continued from previous page
SINGLE-USER WAREHOUSE SINGLE-USER WAREHOUSE LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS1
IN LOCAL CURRENCY AS OF MARCH 2012 CITY LOCAL CURRENCY LAND VALUE2 (PSF) CAPITAL VALUE3 (PSF) MONTHLY GROSS RENT (PSF) 0.75 0.68 0.64 IN US$ AS OF MARCH 2012 LAND VALUE2 (PSF) CAPITAL VALUE3 (PSF) MONTHLY GROSS RENT (PSF) 0.62 0.55 0.52 BASIS OF LAND, CAPITAL VALUES AND MONTHLY GROSS RENTS (LOCAL MARKET NORM) LAND TENURE (YEARS) PLOT RATIO LAND AREA (SQ FT) GROSS FLOOR AREA (SQ FT) 35,000 50,000 50,000
Wellington Ngaurang Petone Seaview NZ$ NZ$ NZ$ 53.42 48.77 26.71 121.35 109.74 97.82 43.66 39.86 21.83 99.18 89.69 79.95 Freehold Freehold Freehold 0.5 0.5 0.5 70,000 100,000 100,000
1. Values and rents may not be quoted in $ psf in local market practice 2. Land values are expressed as $ psf per plot ratio 3. Capital values refer to the values of both land and building 4. Rental series for Auckland and Wellington are on a net basis 5. The Urayasu submarket remained flooded. Land, capital values and rents are not available. 6. Values provided are for multi-user warehouse buildings
P. 29
LOCAL MARKET NORM

SINGLE-USER FACTORY SINGLE-USER FACTORY LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS1
IN LOCAL CURRENCY AS OF MARCH 2012 CITY LOCAL CURRENCY LAND VALUE2 (PSF) CAPITAL VALUE3 (PSF) MONTHLY GROSS RENT (PSF) 7.02 4.89 2.73 7.26 8.91 10.81 3,383.00 0.66 1.12 0.54 0.56 14.00 18.00 26.00 38.00 22.00 52.00 43.00 2.88 3.26 1.52 IN US$ AS OF MARCH 2012 LAND VALUE2 (PSF) CAPITAL VALUE3 (PSF) MONTHLY GROSS RENT (PSF) 1.12 0.78 0.43 0.94 1.15 1.39 0.35 0.69 1.17 0.56 0.58 0.27 0.35 0.51 0.74 0.43 1.02 0.84 0.46 0.52 1.21 BASIS OF LAND, CAPITAL VALUES AND MONTHLY GROSS RENTS (LOCAL MARKET NORM) LAND TENURE (YEARS) PLOT RATIO LAND AREA (SQ FT) GROSS FLOOR AREA (SQ FT) 429,000 54,600 430,556 64,584 64,584 32,292 215,268 225,000 N.A N.A N.A 36,000 168,000 24,000 18,000 24,000 18,000 18,750 18,750 18,750 6,250 18,750 12,500 8,750 150,000 150,000 250,000
Beijing Shang Di Yi Zhuang Greater Tokyo Chiba - Ichikawa Chiba - Mihama Saitama - Ageo Tokyo - Ota Yokohama - Naka Guangzhou GETDD Hong Kong4 Low Quality Mid Quality Prime Quality Jakarta Bekasi Karawang Melbourne East & Southeast Fringe North West New Delhi Delhi - NH1 Delhi - NH8 Delhi - NH24 Delhi - East Delhi - North Delhi - South Delhi - West Shanghai Minhang District Pudong New Area Singapore Central S$ 127.78 207.76 101.64 165.26 30+30 2.5 100,000 CNY CNY 122.11 133.40 341.40 379.02 19.40 21.19 54.24 60.22 50 50 1.0 1.0 150,000 150,000 Rs Rs Rs Rs Rs Rs Rs 1,300.00 1,300.00 2,600.00 7,800.00 11,400.00 13,500.00 14,900.00 1,500.00 2,880.00 5,200.00 6,000.00 6,800.00 5,580.00 25.41 25.41 50.82 152.47 222.85 263.90 291.26 29.32 56.30 101.65 117.29 132.93 109.08 99 99 99 Freehold Freehold Freehold Freehold 1.25 1.25 1.25 1.25 1.25 1.25 1.25 15,000 15,000 15,000 5,000 15,000 10,000 7,000 A$ A$ A$ A$ 19.74 58.53 16.95 14.86 102.19 213.68 92.90 78.97 20.53 60.88 17.63 15.46 106.30 222.27 96.63 82.14 Freehold Freehold Freehold Freehold 0.6 0.6 0.6 0.6 40,000 30,000 40,000 30,000 Rp Rp 139,321.00 98,917.00 250,929.00 195,167.00 14.39 10.22 25.92 20.16 30 30 2.4 2.4 15,000 70,000 HK$ HK$ HK$ 1,954.23 2,444.38 3,492.09 251.69 314.81 449.75 N.A N.A N.A N.A N.A N.A N.A N.A N.A CNY 56.67 269.50 9.00 42.82 50 1.5 150,000 JPY JPY JPY JPY JPY 3,673.00 2,319.00 1,733.00 9,893.00 3,932.00 10,498.00 9,104.00 8,547.00 16,722.00 10,777.00 44.56 28.14 21.03 120.03 47.71 127.37 110.46 103.70 202.89 130.76 Freehold Freehold Freehold Freehold Freehold 2.0 2.0 2.0 2.0 2.0 215,278 32,292 32,292 16,146 107,634 CNY CNY 318.86 56.75 730.48 437.03 50.66 9.02 116.05 69.43 50 50 1.1 1.3 39,000 42,000
1. Values and rents may not be quoted in $ psf in local market practice 2. Land values are expressed as $ psf per plot ratio 3. Capital values refer to the values of both land and building 4. Values provided are for multi-user factory buildings
P. 30
D E F I N I T I O N A N D T E R M I N O LO GY
1. MULTI-NATIONAL CORPORATION (MNC) A MNC is defined as a large company that has operations in multiple nations and that requires industrial space. 6. MONTHLY GROSS RENT FOR HIGH-SPECS SPACE This is the monthly rent payable to a landlord less all tenant inducements, e.g. rent-free periods. It includes the amount of interest income foregone for the security deposit, maintenance fees (i.e. fees for maintaining common areas, e.g. security, building insurance and normal water and energy consumption) and statutory real estate charges (e.g. property tax). Data is expressed as per sq ft of net floor area, which excludes common areas such as toilets, corridors, stairways, lift lobbies, etc. A three-year lease term is common in most countries in the Asia Pacific region.
2. FACTORY Unless otherwise stated, this refers to single-user industrial space catering to MNCs for production/manufacturing purposes.
3. WAREHOUSE Unless otherwise stated, this refers to single-user industrial space catering to MNCs with warehousing requirements as well as their business as third-party logistics, distribution and warehousing.
7. MONTHLY GROSS RENT FOR SINGLE-USER INDUSTRIAL SPACE This is the monthly rental payable to a landlord for a whole industrial premises by a single tenant. Data is expressed as per sq ft of gross floor area. A three-year lease term is common in most countries in the Asia Pacific region.
4. HIGH-SPECIFICATIONS (HIGH-SPECS) INDUSTRIAL SPACE This refers to multi-user industrial premises catering to MNCs with floor areas of about 10,000 sq ft, fitted with higher than normal specifications and offering hybrid office-industrial characteristics. This type of space is suitable for high value-added, technology-based manufacturing, information technology, product development, and research and development.
5. LAND Land refers to vacant prepared land with roads, drainage, electricity supply, water supply, telephone service and sewerage. The land is typically located within industrial estates that are frequently inquired by MNCs and located between 10 and 100 km of the metropolitan area. In addition, the land is also a single-user, single-development site, as opposed to one that is intended for parcellation for multiple users.
P. 31
For further details, please contact:
GREATER CHINA Beijing, China 502 Tower W3, Oriental Plaza No 1 East Changan Avenue Dongcheng District Beijing 100738 Tel: +86 10 8518 1633 Fax: +86 10 8518 1638 Carlby Xie Director, Research carlby.xie@colliers.com Shanghai, China 12F Hong Kong New World Tower 300 Huaihai Zhong Road Shanghai 200021 Tel: +86 21 6141 3688 Fax: +86 21 6141 3699 James Shepherd Senior Director, Research & Advisory, Corporate and Institutional Services, james.shepherd@colliers.com Guangzhou, China Room 702 Teem Tower 208 Tianhe Road Guangzhou 510620 Peoples Republic of China Tel: +86 20 3819 3888 Fax: +86 20 3819 3899 Bryan Chan Director, Research & Advisory bryan.chan@colliers.com Hong Kong, HK SAR 5701 Central Plaza 18 Harbour Road, Wanchai Company Licence No. C-006052 Tel: +852 2828 9888 Fax: +852 2828 9899 Simon Lo Executive Director, Research & Advisory, Asia simon.lo@colliers.com Taipei, Taiwan 49F Taipei 101 Tower No 7 Xin Yi Road Sec 5 Taipei 110 Taiwan ROC Tel: +886 2 8101 2000 Fax: +886 2 8101 2345 Paul Lee Director, Research paul.lee@colliers.com
NORTH ASIA Tokyo, Japan Halifax Building, 3-16-26, Roppongi Minato-ku, Tokyo 106-0032 Japan Tel: +81 3 5563 2111 Fax: +81 3 5563 2100 Yumiko Yasuda Head, Research yumiko.yasuda@colliers.co.jp SOUTHEAST ASIA Jakarta, Indonesia 10F World Trade Centre Jalan Jenderal Sudirman Kav 29-31 Jakarta 12920 Tel: +62 21 521 1400 Fax: +62 21 521 1411 Ferry Salanto Associate Director, Research ferry.salanto@colliers.com Singapore 1 Raffles Place #45-00 One Raffles Place Singapore 048616 Tel: +65 6223 2323 Fax: +65 6222 4901 Chia Siew Chuin Director, Research & Advisory siew-chuin.chia@colliers.com INDIA Gurgaon TechnoPolis Building First Floor, DLF Golf Course Main Road Sect. 54 Gurgaon 122002 Tel: 91 124 456 7500 Fax: 91 124 456 7502 Surabhi Arora, MRICS Associate Director, Research surabhi.arora@colliers.com
AUSTRALASIA Melbourne, Australia Level 32 Optus Centre 367 Collins Street Melbourne VIC 3000, Australia Tel: +61 3 9629 8888 Fax: +61 3 9629 8549 Nerida Conisbee National Director, Research nerida.conisbee@colliers.com Sydney, Australia Level 12, Grosvenor Place 225 George Street Sydney NSW 2000 Tel: +61 2 9257 0222 Fax: +61 2 9251 3297 Mathew Tiller Manager, Research mathew.tiller@colliers.com Auckland, New Zealand SAP Tower Level 27, 151 Queen Street, Auckland City Tel: +64 9 358 1888 Fax: +64 9 358 1999 Alan McMahon National Director, Research and Consulting alan.mcmahon@colliers.com Wellington, New Zealand Level 10, 36 Customhouse Quay Wellington Tel: +64 4 473 4413 Fax: +64 4 499 1550 Alan McMahon National Director, Research and Consulting alan.mcmahon@colliers.com
This report and other research materials may be found on our website at www.colliers.com. Questions related to information herein should be directed to the Research Department at the number indicated above. This document has been prepared by Colliers International for general information only. Colliers International makes no guarantees, representations or warranties of any kind, express or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. Colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from. This publication is the copyrighted property of Colliers International and/ or its licensor(s). 2012. All rights reserved.
P. 32
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ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW

Jakarta ................................................................................................................ 13 Japan 15 Greater Tokyo .....................................................................................................15 New Zealand 16-17

Auckland .............................................................................................................16 Wellington ........................................................................................................... 17 Singapore Taiwan 18-19 20

Taiwan ................................................................................................................ 20 International Comparison 21-27

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

0.51% -1.53% A$30.6 billion A$9.6 billion 1,097,209 n.a.

Industrial Industrial Industrial Industrial Industrial Industrial Industrial Industrial Industrial

Lease Lease Lease Lease Lease Sale Sale Sale Sale

139,932 172,601 188,704 270,209 474,004 252,470 268,228 299,594 301,650

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

1.2% n.a. A$155.3 billion A$162.5 billion 1,236,232 n.a.

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

8.1% 7.9% US$171.9 billion US$32.0 billion n.a. 780,600

Warehouse Warehouse Warehouse Land Land Land

Lease Lease Lease Sale Sale Sale

43,055 53,819 269,100 930,271 2,253,984 4,433,590

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

11.0% 12.9% US$31.8 billion US$29.5 billion 7.8 million 791,000

Land Land Land Land Land Land

Sale Sale Sale Sale Sale Sale

139,891 312,277 362,020 442,408 1,077,840 2,164,966

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

Vailog Dianshan Lake GLP PVG Blogis Songjiang Minhang Fengxian

Warehouse Warehouse Warehouse Workshop Workshop

Lease Lease Lease Sale Sale

IHUSH KWE Nissan AVIC Civil Aviation Electronics XCMG

279,864 322,920 430,560 2,650,000 3,750,000

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

Warehouse Industrial Industrial Industrial Industrial

Lease Sale Sale Sale Sale

270,000 76,368 87,822 89,157 158,000

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

6.9% 1.9% US$231.5 billion US$145.7 billion n.a. n.a.

NH8 Palwal Bhiwadi Bhiwadi NH24

Warehouse Factory Warehouse Factory Factory

Lease Lease Sale Sale Sale

Om Pipes Eicher Swastik Jee Chemical Bhushan Steel

18,000 100,000 12,000 100,000 144,000

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

1.4% -2.0% US$99.8 billion US$93.3 billion 5.6 million n.a.

MAJOR TRANSACTIONS IN JAKARTA TRANSACTIONS

Land Land Land Land Land Land Land Land Land

Sale Sale Sale Sale Sale Sale Sale Sale Sale

269,098 301,389 312,153 312,153 322,917 322,917 322,917 333,681 355,209

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

MAJOR TRANSACTIONS IN JAKARTA TRANSACTIONS

Suryacipta Suryacipta Jababeka Suryacipta Suryacipta Suryacipta Suryacipta Jababeka Suryacipta

Land Land Land Land Land Land Land Land Land

Sale Sale Sale Sale Sale Sale Sale Sale Sale

365,973 365,973 430,556 538,195 559,723 581,251 581,251 839,584 2,906,253

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

-0.6%1) -3.9%1) 15.18 tillion2) 12.22 tillion2) 3.84 million3) 964,7064)

Logistics Logistics Logistics Logistics Logistics Logistics

Sale Sale Sale Sale Sale Sale

177,284 242,405 255,904 1,338,340 4,183,670 8,298,848

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

1.4% 1.4% NZ$24.1 billion NZ$22.0 billion 39.6 million 104,471

MAJOR TRANSACTIONS IN AUCKLAND TRANSACTIONS

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse Office/Warehouse

Lease Lease Lease Sale Sale Sale

16,146 42,777 60,278 26,651 33,906 34,401