ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW - Colliers

ASIA PACIFICINDUSTRIAL MARKET OVERVIEW

Accelerating success.

May 2012

TABLE OF CONTENTSASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012

Regional Overview 3

Australia 5-6 Melbourne ............................................................................................................ 5 Sydney ................................................................................................................. 6 China 7-9 Beijing ...................................................................................................................7 Guangzhou ........................................................................................................... 8 Shanghai .............................................................................................................. 9 Hong Kong SAR 10-11 India 12 New Delhi ...........................................................................................................12

Indonesia 13-14 Jakarta ................................................................................................................ 13

Japan 15 Greater Tokyo .....................................................................................................15

New Zealand 16-17 Auckland .............................................................................................................16 Wellington ........................................................................................................... 17

Singapore 18-19

Taiwan 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

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 high-

specification factories.

COLLIERS INTERNATIONAL | P. 3

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 Indonesia’s Karawang and Bekasi areas, where land prices surged by another 38.6% and 24.9% respectively during the current review period, as Indonesia’s 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 Zealand’s 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.

P. 4 | COLLIERS INTERNATIONAL

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.

ASIA PACIFIC INDUSTRIAL MARKET OVERVIEW | MAY 2012


ECONOMIC INDICATORS FOR MELBOURNE

ECONOMIC INDICATORS

INDICATORS PERIOD DATA

Year-on-Year GDP Growth October 2011 - March 2012 0.51%Year-on-Year Manufacturing Output Growth Rate October 2011 - March 2012 -1.53%Total Imports October 2011 - March 2012 A$30.6 billionTotal Exports October 2011 - March 2012 A$9.6 billionContainer Throughput (TEUs) October 2011 - March 2012 1,097,209Air Cargo Throughput (Tonnes) October 2011 - March 2012 n.a.

AUSTRALIA

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 Melbourne’s 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 GPT’s 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.

• 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.

MAJOR TRANSACTIONS IN MELBOURNE

TRANSACTIONS

BUILDING/LAND PLOT PROPERTY TYPE LEASE/SALE TENANT/PURCHASER FLOOR/LAND AREA (SQ FT)

437 - 481 Plummer Street, Port Melbourne Industrial Lease Chrysler Australia 139,932 Atlantic Drive - Warehouse A, Keysborough Industrial Lease ESR Holdings 172,601 71 - 83 Whiteside Road, Clayton Industrial Lease Corning 188,704Atlantic Drive, Keysborough Industrial Lease Trimas 270,209 Kororoit Creek Road, Altona North Industrial Lease Silk Logistics 474,004 19 - 39 Studley Court, Derrimut Industrial Sale Private Investor 252,4708 Dunlop Court, Bayswater Industrial Sale Quintessential Equities Pty Ltd 268,228Citiport Business Park, Port Melbourne Industrial Sale GPT 299,594 557 Mount Derrimut Road, Derrimut Industrial Sale Private Investor 301,650

* n.a. denotes not available



ECONOMIC INDICATORS FOR SYDNEY

ECONOMIC INDICATORS


Year-on-Year GDP Growth July - December 2011 1.2%Year-on-Year Manufacturing Output Growth Rate October 2011 - March 2012 n.a.Total Imports August 2011 - January 2012 A$155.3 billionTotal Exports August 2011 - January 2012 A$162.5 billionContainer Throughput (TEUs) August 2011 - January 2012 1,236,232Air Cargo Throughput (Tonnes) October 2011 - March 2012 n.a.

AUSTRALIA

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 Logistics’s A$123 million purchase of Stockland’s 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

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 Sydney’s industrial markets while incentives for tenants should begin to fall in the short term.


MAJOR TRANSACTIONS IN SYDNEY

TRANSACTIONS


1 Hale Street, Botany Warehouse Lease TOLL Paper 87,98453 Britton Street, Smithfield Warehouse Lease Cope Sensitive Freight 141,04094 - 106 Lenore Drive, Erskine Park Warehouse Lease DB Schenkar 226,042Moorebank Intermodal Terminal [55% stake] Intermodal Terminal Sale Qube Logistics n.a.920 Richmond Rd, Marsden Park Land Sale Ikea n.a.L7, Central Hills Business Park , Gregory Hills Land Sale Owner Occupier 161,45917 - 21 Doody St, Alexandria Warehouse Sale Owner Occupier 38,266111 Wicks Rd, North Ryde Warehouse Sale Owner Occupier 54,23917 - 19 Orion Rd, Lane Cove Warehouse Sale Private Investor 87,10297 Williamson Rd, Ingleburn Warehouse Sale Owner Occupier 108,75921 Worth St, Chullora Warehouse Sale Private Investor 267,634




ECONOMIC INDICATORS FOR BEIJING

ECONOMIC INDICATORS


Year-on-Year GDP Growth January – December 2011 8.1%Year-on-Year Manufacturing Output Growth Rate January – December 2011 7.9%Total Imports July – December 2011 US$171.9 billionTotal Exports July – December 2011 US$32.0 billionContainer Throughput (TEUs) July – December 2011 n.a.Air Cargo Throughput (Tonnes) July – December 2011 780,600

CHINA

BEIJING


• 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.

• Beijing’s 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 Centre’s 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 Company’s 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.

• 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 Beijing’s 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 GLP’s 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 China’s economy, Beijing’s 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.

MAJOR TRANSACTIONS IN BEIJING

TRANSACTIONS


Crown Logistics Centre Warehouse Lease DHL 43,055GLP Park Beijing Capital Airport Warehouse Lease Unipart Logistics 53,819Dewei Warehouse Lease Gome 269,100

Tongzhou Land Sale Beijing Liandongyongle Investment and Management Company 930,271

Yizhuang Land Sale Beijing Jingdong Century Commerce Company 2,253,984

Miyun Economic and Development Zone Land Sale Beijing Hi-tech Business Innovation Service Centre 4,433,590




ECONOMIC INDICATORS FOR GUANGZHOU

ECONOMIC INDICATORS


Year-on-Year GDP Growth January – December 2011 11.0%Year-on-Year Manufacturing Output Growth Rate January – December 2011 12.9%Total Imports July – December 2011 US$31.8 billionTotal Exports July – December 2011 US$29.5 billionContainer Throughput (TEUs) July – December 2011 7.8 millionAir Cargo Throughput (Tonnes) July – December 2011 791,000

CHINA

GUANGZHOU


• Notwithstanding the slowdown in global economic recovery and the contagion of the Eurozone sovereign debt crisis, Guangzhou’s 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

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 & Gamble’s acquisition of a 2.16 million sq ft plot in China-Singapore Knowledge City, Yakult (Guangzhou) Co. Ltd’s acquisition of 0.36 million sq ft plot in Yonghe, GETDD and Vejesto Electric’s 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.

MAJOR TRANSACTIONS IN GUANGZHOU

TRANSACTIONS


Jiulong Industrial Park Land Sale Vejesto Electric 139,891Jiulong Industrial Park Land Sale Guangzhou Zhenghan Material Technology 312,277Development Zone, Yonghe, GETDD Land Sale Yakult (Guangzhou ) Co.Ltd 362,020Guangzhou Science City Land Sale Guangzhou Nanxin Medicine 442,408

Jiulong Industrial Park Land Sale Guangzhou Jingdong Trade Co. Ltd (360buy.com) 1,077,840

China-Singapore Knowledge City, GETDD Land Sale Guangzhou Procter & Gamble 2,164,966



ECONOMIC INDICATORS FOR SHANGHAI

ECONOMIC INDICATORS


Year-on-Year GDP Growth October 2011 – March 2012 7.2%Year-on-Year Manufacturing Output Growth October 2011 – March 2012 3.4%Total Imports October 2011 – March 2012 US$133.1 billionTotal Exports October 2011 – March 2012 US$165.7 billionContainer Throughput (TEUs) October 2011 – March 2012 15.5 millionAir Cargo Throughput (Tonnes) October 2011 – March 2012 1.7 million

CHINA

SHANGHAI


• Aimed partly at stimulating China’s 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, Shanghai’s economy managed to stay on the expansion path in the six months ending March 2012 in spite of the troubled global economy. In fact, Shanghai’s Purchasing Managers’ Index (PMI) for March 2012 outperformed China’s national levels for the first time since May 2011, with a reading of 53.2, indicating that the city’s 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 XCMG’s 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

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 Nissan’s lease of a 0.43 million sq ft warehouse facility in Songjiang district and KWE’s 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 Shanghai’s 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 Government’s target for Shanghai to achieve an average economic growth rate of 8% for the next five-year period from 2011.

MAJOR TRANSACTIONS IN SHANGHAI

TRANSACTIONS


Vailog Dianshan Lake Warehouse Lease IHUSH 279,864 GLP PVG Warehouse Lease KWE 322,920 Blogis Songjiang Warehouse Lease Nissan 430,560 Minhang Workshop Sale AVIC Civil Aviation Electronics 2,650,000Fengxian Workshop Sale XCMG 3,750,000



ECONOMIC INDICATORS FOR HONG KONG SAR

ECONOMIC INDICATORS


Year-on-Year GDP Growth July - December 2011 3.62%Year-on-Year Manufacturing Output Growth Rate September 2011 – February 2012 -20.94%Total Imports September 2011 – February 2012 HK$1,858 billionTotal Exports September 2011 – February 2012 HK$1,647 billionContainer Throughput (TEUs) September 2011 – February 2012 11.8 millionAir Cargo Throughput (Tonnes) September 2011 – February 2012 1.9 million

HONG KONG SAR

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 Kong’s 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% quarter-on-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 end-users 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 better-than-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.



MAJOR TRANSACTIONS IN HONG KONG SAR

TRANSACTIONS


Interlink Warehouse Lease Nippon Express 270,000Clifford Tower Industrial Sale Sinociti Ltd 76,368Dynamic Cargo Centre Industrial Sale Goodman 87,822Joyce Building Industrial Sale Local investor 89,157Big Orange - Kwai Chung Industrial Sale Far East Consortium and Kosmopolito Hotels 158,000

HONG KONG SAR

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.

• I-O rents are expected to decline 5% in the next 12 months if the global economic performance remains sluggish in the coming quarters.



ECONOMIC INDICATORS FOR INDIA

ECONOMIC INDICATORS


Year-on-Year GDP Growth September 2011 - February 2012 6.9%Year-on-Year Manufacturing Output Growth Rate September 2011 - February 2012 1.9%Total Imports September 2011 - February 2012 US$231.5 billionTotal Exports September 2011 - February 2012 US$145.7 billionContainer Throughput (TEUs) October 2011 - March 2012 n.a.Air Cargo Throughput (Tonnes) October 2011 - March 2012 n.a.

INDIA

NEW DELHI


• Thanks to the moderation in India’s 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 India’s sagging economic growth.

• These measures have helped to stamp falling growth rates in Delhi’s industrial sector. The manufacturing sector, which accounts for over 75% of India’s 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 India’s manufacturing sector, sentiments in Delhi’s 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

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 Steel’s purchase of a 144,000-sq ft factory at NH 24 and Jee Chemical’s acquisition of a 100,000-sq ft factory at Bhiwadi while a notable lease transaction concluded in the review period was Eicher’s lease of a 100,000-sq ft factory at Palwal.

• With the continuous improvements in Delhi’s industrial infrastructure and the government’s 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.

MAJOR TRANSACTIONS IN NEW DELHI

TRANSACTIONS


NH8 Warehouse Lease Om Pipes 18,000Palwal Factory Lease Eicher 100,000Bhiwadi Warehouse Sale Swastik 12,000Bhiwadi Factory Sale Jee Chemical 100,000NH24 Factory Sale Bhushan Steel 144,000




MAJOR TRANSACTIONS IN JAKARTA

TRANSACTIONS


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

Suryacipta Land Sale automotive component (name undisclosed) 322,917

Delta Silicon Land Sale Japanese autoparts (name undisclosed) 333,681Delta Silicon Land Sale Japanese autoparts (name undisclosed) 355,209

ECONOMIC INDICATORS FOR JAKARTA

ECONOMIC INDICATORS


Year-on-Year GDP Growth January – March 2012 1.4%Year-on-Year Manufacturing Output Growth Rate January – March 2012 -2.0%Total Imports October 2011 – March 2012 US$99.8 billionTotal Exports October 2011 – March 2012 US$93.3 billionContainer Throughput (TEUs) January – December 2011 5.6 millionAir Cargo Throughput (Tonnes) October 2011 – March 2012 n.a.

INDONESIA

JAKARTA


• Indonesia’s 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 Indonesia’s 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.


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INDONESIA

MAJOR TRANSACTIONS IN JAKARTA

TRANSACTIONS


Suryacipta Land Sale automotive component(name undisclosed) 365,973


Jababeka Land Sale pharmacy(name undisclosed) 430,556


Suryacipta Land Sale plastic(name undisclosed) 559,723

Suryacipta Land Sale automotive component(name undisclosed) - #1 581,251

Suryacipta Land Sale automotive component(name undisclosed) - #2 581,251

Jababeka Land Sale manufacturing & electronics(name undisclosed) 839,584

Suryacipta Land Sale automotive component(name undisclosed) 2,906,253

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ECONOMIC INDICATORS FOR GREATER TOKYO

ECONOMIC INDICATORS


Year-on-Year GDP Growth July - December 2012 -0.6%1)

Year-on-Year Manufacturing Output Growth Rate July - December 2012 -3.9%1)

Total Imports July - December 2012 ¥15.18 tillion2)

Total Exports July - December 2012 ¥12.22 tillion2)

Container Throughput (TEUs) July - December 2012 3.84 million3)

Air Cargo Throughput (Tonnes) July - December 2012 964,7064)

JAPAN

GREATER TOKYO


• Japan’s 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

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 Trust’s 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 Investment’s 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.

1) Nationwide2) Tokyo port (Tokyo-kou, Narita) and Yokohama Port (Yokohama, Kawasaki, Yokosuka, Chiba and Kisarazu)3) Tokyo custom and Yokohama custom4) Narita Airport

MAJOR TRANSACTIONS IN GREATER TOKYO

TRANSACTIONS


IIF Atsugi Logistic Centre III Logistics Sale IIF Investment Co. 177,284 Misato Logistic Centre Logistics Sale Japan Logistics Fund, Inc. 242,405 Tsurugashima Logistic Centre Logistics Sale Orix Real Estate Co. 255,904Seven Logistic facilities (more than 70% located in Tokyo, 15% in Greater Osaka and Greater Nagoya)

Logistics Sale Mapletree Logistic Trust 1,338,340

Three Logistic facilities located in Kawasaki Logistics Sale SPC of Fortress Investment Group 4,183,670

15 logistic facilities (more than 90% located in Greater Tokyo and Osaka) Logistics Sale The joint venture of Global Logistic Properties

and China Investment Corporation 8,298,848



ECONOMIC INDICATORS FOR NEW ZEALAND

ECONOMIC INDICATORS


Year-on-Year GDP Growth December 2011 1.4%Year-on-Year Manufacturing Output Growth Rate December 2011 1.4%Total Imports October 2011 – March 2012 NZ$24.1 billionTotal Exports October 2011 – March 2012 NZ$22.0 billionContainer Throughput (TEUs) October 2011 – March 2012 39.6 millionAir Cargo Throughput (Tonnes) October 2011 – March 2012 104,471

NEW ZEALAND

AUCKLAND

Office/Warehouse

• New Zealand’s 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 Office/Warehouse Lease Royal Wolf Trading New Zealand 279,2913 - 9 Westfield Place, Mt Wellington Office/Warehouse Lease Mazda Motors 83,07641 Sir William Avenue, East Tamaki Office/Warehouse Lease LFA (NZ) 44,89687 - 89 Carbine Road, Mt Wellington Office/Warehouse Lease Rentokil Initial 20,451 3 Rockridge Ave, Penrose Office/Warehouse Lease Rilee Signs 18,729 9 - 13 Sims Road, Penrose Office/Warehouse Lease Loadlift 18,69799 Carbine Road, Mt Wellington Office/Warehouse Lease Southern Pine Products 18,43936 - 50 Wilkinson Road, Penrose Office/Warehouse Sale Trevor Rands and Investors 527,43192 - 98 Harris Road, East Tamaki Office/Warehouse Sale Direct Property Fund 279,861 59 Woodcocks Road, Warkworth Office/Warehouse Sale Private Investor 68,717 55 Hugo Johnston Drive, Penrose Office/Warehouse Sale Jerdi Partnership 43,508525 Great South Road, Penrose Office/Warehouse Sale Akoranga Properties 46,780



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

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.

MAJOR TRANSACTIONS IN WELLINGTON

TRANSACTIONS


Unit 16, 27 Blenheim St, Upper Hutt Office/Warehouse Lease Fuji Xerox New Zealand 16,146 Unit 2 & 3, 77 Port Road, Seaview Office/Warehouse Lease Forman Building Systems 42,777 Uniplas Building, 201 Eastern Hutt Road, Lower Hutt Office/Warehouse Lease Wellington Regional Council 60,278

4 - 6 Jackson Street & 20 Te Puni Street Office/Warehouse Sale Tom Hudig Trust 26,651

57 Parkside Road, Lower Hutt Office/Warehouse Sale Private Investor 33,906 3 Broken Hill, Porirua Office/Warehouse Sale Takakopa Properties 34,401



ECONOMIC INDICATORS FOR SINGAPORE

ECONOMIC INDICATORS


Year-on-Year GDP Growth October 2011 – March 2012 2.6%Year-on-Year Manufacturing Output Growth Rate October 2011 – March 2012 2.8%Total Imports October 2011 – March 2012 S$ 238.8 billionTotal Exports October 2011 – March 2012 S$ 261.6 billionContainer Throughput (TEUs) October 2011 – March 2012 15.2 millionAir Cargo Throughput (Tonnes) October 2011 – March 2012 933,843

SINGAPORE

SINGAPORE


• 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 Singapore’s 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 Trust’s 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 Trust’s 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 Corporation’s 198,055-sq ft factory at 2 Pandan Road and CWT’s 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 Singapore’s Global-Asia positioning to tap into growth opportunities in Asia and the rest of the world. In addition, Singapore’s sound economic fundamentals should help the country and the industrial market ride through the current uncertainties. Hence, while Singapore’s industrial land, capital values and rents will likely soften in the next 12 months, the fall is expected to be capped at 3%.


• 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



MAJOR TRANSACTIONS IN SINGAPORE

ECONOMIC INDICATORS


Mapletree Business City, 20 & 30 Pasir Panjang Road High-Specs Lease Samsung Asia 80,000

Mapletree Business City, 20 & 30 Pasir Panjang Road High-Specs Lease Toshiba 52,000

UE Bizhub East, 6 & 8 Changi Business Park Avenue 1 High-Specs Lease Cisco Systems 110,000

1,3,5,7,9,11 Howard Road Factory Sale Dairy Industries 75,39325 Pioneer Crescent Factory Sale Cambridge Industrial Trust 76,0037 Ubi Close Factory Sale Alpine Motors 76,5966 Woodlands Loop Factory Sale Sabana REIT 77,54416 Tai Seng Street Factory Sale Cambridge Industrial Trust 213,96531 Admiralty Road Warehouse Sale Storhub 137,1873C Toh Guan Road East Warehouse Sale Cambridge Industrial Trust 192,86421 Changi North Way Warehouse Sale Cache Logistics Trust 196,9883 Changi Business Park Vista High-Specs Sale Ascendas REIT 197,927Cintech I, II, III, IV High-Specs Sale Ascendas REIT 583,522Corporation Place, 2 Corporation Road High-Specs Sale Ascendas REIT 824,902

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

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.



ECONOMIC INDICATORS FOR TAIWAN

ECONOMIC INDICATORS


Year-on-Year GDP Growth October 2011 - March 2012 0.63%Year-on-Year Manufacturing Output Growth Rate October 2011 - March 2012 -2.15%Total Imports October 2011 - March 2012 US$131.9 billionTotal Exports October 2011 - March 2012 US$146.5 billionContainer Throughput (TEUs) October 2011 - March 2012 6.7 millionAir Cargo Throughput (Tonnes) October 2011 - March 2012 821,946

TAIWAN

TAIWAN


• Taiwan’s 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 take-up 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. Ltd’s 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,

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. Ltd’s acquisition of the 120,865-sq ft S.I.T. Wanguo Centre for NT$2.47 billion, TransAsia Airways Co. Ltd’s acquisition of the 42,583-sq ft Green Energy Headquarters for NT$704 million and Taiwan Secom Co. Ltd’s acquisition of the 28,262-sq ft Green Energy Headquarters for NT$487 million.

• Going forward, the Eurozone crisis and deceleration of China’s economic growth is expected to affect Taiwan’s 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.

MAJOR TRANSACTIONS IN TAIPEI

TRANSACTIONS


Guang Yuan Technology Building High-Specs Lease Jollywiz Digital Technology Co. Ltd 17,790 Yang Ming Neihu Building High-Specs Lease E-TEN Information Systems Co. Ltd 28,464

Tokyo Technology Headquarters(A) High-Specs Lease Satellite Television Asia Region Ltd, Taiwan Branch 46,254

Union Freedom Plaza High-Specs Lease Nestle Taiwan Co. Ltd 49,812 Green Energy Headquarter High-Specs Sale Taiwan Secom Co. Ltd 28,262Green Energy Headquarter High-Specs Sale TransAsia Airways Co. Ltd 42,583 S.I.T. Wanguo Centre High-Specs Sale Mercuries Life Insurance Co. Ltd 120,865 Eten Neihu Building High-Specs Sale Delta Electronics, Inc. 263,292



INTERNATIONAL COMPARISONThe 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

CITY

VALUE AS OF MARCH 2012 (US$) 12-MONTH FORECAST (US$) BASIS OF LAND AND CAPITAL VALUES

LAND VALUE1

(PSF)

CAPITAL VALUE2 (PSF)

MONTHLY GROSS RENT (PSF)

LAND VALUE1 (PSF)



LAND TENURE (YEARS)

PLOT RATIO

LAND AREA

(SQ FT)

GROSS FLOOR AREA

(SQ FT)Auckland3

Former Auckland City 19.63 82.56 0.57 19.92 85.44 0.59 60 1.0 100,000 100,000

Manukau 18.70 80.98 0.56 18.92 83.81 0.58 60 1.0 100,000 100,000

North Shore 26.73 97.47 0.64 26.82 100.89 0.66 60 1.0 100,000 100,000

Beijing

Tianzhu 19.92 88.42 0.50 20.43 90.99 0.52 60 1.0 100,000 100,000

Tongzhou 11.64 67.45 0.44 11.93 69.60 0.46 60 1.0 100,000 100,000

Greater Tokyo4

Chiba - Urayasu - - - - - - 60 1.0 100,000 100,000

Kawasaki - Higashi Ogishima 37.31 184.57 1.64 37.31 184.57 1.64 60 1.0 100,000 100,000

Tokyo - Ariake 124.42 236.37 2.10 124.42 236.37 2.10 60 1.0 100,000 100,000

Tokyo - Heiwajima 131.11 306.25 3.08 131.11 306.25 3.08 60 1.0 100,000 100,000

Tokyo - Shinsuna 169.75 282.86 2.26 169.75 282.86 2.26 60 1.0 100,000 100,000

Yokohama - Daikokufuto 16.13 168.06 2.00 16.13 168.06 1.91 60 1.0 100,000 100,000

Guangzhou

GETDD 9.54 50.10 0.50 9.58 51.83 0.52 60 1.0 100,000 100,000

Hong Kong5

Ramp Access - 369.53 1.39 - 354.75 1.37 60 1.0 100,000 100,000

Cargo Lift Access - 349.85 0.96 - 332.36 0.93 60 1.0 100,000 100,000

Jakarta

Bekasi 16.26 25.98 - 19.67 27.28 - 60 1.0 100,000 100,000

Melbourne

East & Southeast 14.99 74.41 0.61 15.15 75.15 0.62 60 1.0 100,000 100,000

Fringe 44.45 144.47 0.99 44.88 145.92 1.00 60 1.0 100,000 100,000

North 12.87 67.64 0.51 13.00 68.32 0.51 60 1.0 100,000 100,000

West 11.29 53.39 0.50 11.40 53.92 0.50 60 1.0 100,000 100,000

New Delhi

Delhi - NH1 18.04 - 0.22 18.04 - 0.25 60 1.0 100,000 100,000

Delhi - NH8 23.04 19.94 0.30 22.90 20.60 0.32 60 1.0 100,000 100,000

Delhi - NH24 35.81 39.88 0.45 35.39 42.54 0.47 60 1.0 100,000 100,000

Delhi - East 93.60 63.53 0.61 97.29 64.80 0.63 60 1.0 100,000 100,000

Delhi - North 144.62 76.24 0.38 150.07 77.51 0.40 60 1.0 100,000 100,000

Delhi - South 171.18 76.24 0.90 178.57 77.51 0.91 60 1.0 100,000 100,000

Delhi - West 181.03 61.94 0.71 183.50 63.28 0.73 60 1.0 100,000 100,000

Shanghai

Pudong New Area 50.90 74.24 0.62 51.40 80.40 0.65 60 1.0 100,000 100,000

Singapore

East 68.26 181.68 1.32 68.26 176.54 1.28 60 1.0 100,000 100,000

Sydney

South 80.77 156.38 1.31 80.77 160.09 1.34 60 1.0 100,000 100,000

Southwest 18.02 98.45 0.78 18.02 100.64 0.79 60 1.0 100,000 100,000

West 31.87 144.51 1.21 31.87 145.32 1.23 60 1.0 100,000 100,000

Wellington3

Ngauranga 32.74 69.43 0.56 32.74 67.41 0.54 60 1.0 100,000 100,000

Petone 33.08 62.78 0.50 33.08 60.96 0.48 60 1.0 100,000 100,000

Seaview 18.12 55.97 0.47 18.12 54.34 0.46 60 1.0 100,000 100,000

1. Land values are expressed in US$ psf per plot ratio2. Capital values refer to the values of both land and building3. Rental series for Auckland and Wellington are on a net basis4. The Urayasu submarket remained flooded. Land, capital values and rents are not available5. Values provided are for multi-user warehouse buildings



INTERNATIONAL COMPARISON

INTERNATIONAL COMPARISON OF WAREHOUSE LAND VALUES (MARCH 2012)

INTERNATIONAL COMPARISON OF WAREHOUSE CAPITAL VALUES (MARCH 2012)

* Values provided are for multi-user warehouse buildings

05 01 00 1502 00 2503 00 3504 00

De lhi-NH8Jakarta-Bekasi

De lhi-NH24Gu angzhou-GETDD

Me lbourne-WestWellington-Seaview

De lhi-WestWellington-Petone

De lhi-EastBeijing-Tong zhouMe lbourne-North

Wellington-Nga urangaShangh ai-Pudong New Area

Me lbourne-East & South Eas tDe lhi-NorthDe lhi-South

Auckland-ManukauAuckland-Former Auckland City

Beijing-TianzhuAuckland-North Shore

Sydney-SouthwestMe lbourne-Fringe

Sydney-Wes tSydney-South

Grea ter Tokyo-Yokohama-DaikokufutoSing apore-East

Grea ter Tokyo-Kawasa ki-Higas hi Ogish imaGrea ter Tokyo-Tokyo-Ariake

Grea ter Tokyo-Tokyo-ShinsunaGrea ter Tokyo-Tokyo-He iwajimaHong Kong-Cargo Lift Acces s*

Hong Kong-Ramp Acces s*

Warehouse Capital Values (US$ psf)

0 50 100 150 200 250 300 350 400

Warehouse Capital Values (US$ psf)

Warehouse Land Values (US$ psf per plot ratio)

Guangzhou-GETDDMelbourne-West

Beijing-TongzhouMelbourne-North

Melbourne-East & South EastGreater Tokyo-Yokohama-Daikokufuto

Jakarta-BekasiSydney-Southwest

Delhi-NH1Wellington-SeaviewAuckland-Manukau

Auckland-Former Auckland CityBeijing-Tianzhu

Delhi-NH8Auckland-North Shore

Sydney-WestWellington-Ngauranga

Wellington-PetoneDelhi-NH24

Greater Tokyo-Kawasaki-Higashi OgishimaMelbourne-Fringe

Shanghai-Pudong New AreaSingapore-EastSydney-South

Delhi-EastGreater Tokyo-Tokyo-Ariake

Greater Tokyo-Tokyo-HeiwajimaDelhi-North

Greater Tokyo-Tokyo-ShinsunaDelhi-SouthDelhi-West

0 50 100 150 200

Warehouse Land Values (US$ psf per plot ratio)

Delhi - WestDelhi - South

Greater Tokyo - Tokyo - ShinsunaDelhi - North

Greater Tokyo - Tokyo - HeiwajimaGreater Tokyo - Tokyo - Ariake

Delhi - EastSydney - South

Singapore - EastShanghai - Pudong New Area

Melbourne - FringeGreater Tokyo - Kawasaki - Higashi Ogishima

Delhi - NH 24Wellington - Petone

Wellington - NgaurangaSydney - West

Auckland - North ShoreDelhi - NH 8

Beijing - TianzhuAuckland - Former Auckland City

Auckland - ManukauWellington - Seaview

Delhi - NH 1Sydeny - Southwest

Jakarta - BekasiGreater Tokyo - Yokohama - Daikokufuto

Melbourne - East & South EastMelbourne - NorthBeijing - TongzhouMelbourne - West

Guangzhou - GET DD

Hong Kong - Ramp Access*Hong Kong - Cargo Lift Accees*

Greater Tokyo - Tokyo - HeiwajimaGreater Tokyo - Tokyo - Shinsuna

Greater Tokyo - Tokyo - AriakeGreater Tokyo - Kawasaki - Higashi Ogishima

Singapore - EastGreater Tokyo - Yokohama - Daikokufuto

Sydney - SouthSydney - West

Melbourne - FringeSydeny - Southwest

Auckland - North ShoreBeijing - Tianzhu

Auckland - Former Auckland CityAuckland - Manukau

Delhi - SouthDelhi - North

Melbourne - East & South EastShanghai - Pudong New Area

Wellington - NgaurangaMelbourne - NorthBeijing - Tongzhou

Delhi - EastWellington - Petone

Delhi - WestWellington - Seaview

Melbourne - WestGuangzhou - GET DD

Delhi - NH 24Jakarta - Bekasi

Delhi - NH 8



INTERNATIONAL COMPARISON OF WAREHOUSE MONTHLY GROSS RENTS(MARCH 2012)


* Values provided are for multi-user factory buildings** Rents provided are net rents

Warehouse Monthly Gross Rents (US$ psf)

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50

Delhi-NH1Delhi-NH8

Delhi-NorthBeijing-Tongzhou

Delhi-NH24Wellington-Seaview**

Wellington-Petone**Guangzhou-GETDD

Melbourne-WestBeijing-Tianzhu

Melbourne-NorthWellington-Ngauranga**

Auckland-Manukau**Auckland-Former Auckland City**

Melbourne-East & South EastDelhi-East

Shanghai-Pudong New AreaAuckland-North Shore**

Delhi-WestSydney-Southwest

Delhi-SouthHong Kong-Cargo Lift Access*

Melbourne-FringeSydney-West

Sydney-SouthSingapore-East

Hong Kong-Ramp Access*Greater Tokyo-Kawasaki-Higashi Ogishima

Greater Tokyo-Yokohama-DaikokufutoGreater Tokyo-Tokyo-Ariake

Greater Tokyo-Tokyo-ShinsunaGreater Tokyo-Tokyo-HeiwajimaGreater Tokyo - Tokyo - Heiwajima

Greater Tokyo - Tokyo - ShinsunaGreater Tokyo - Tokyo - Ariake

Greater Tokyo - Yokohama - DaikokufutoGreater Tokyo - Kawasaki - Higashi Ogishima

Hong Kong - Ramp Access*Singapore - EastSydney - SouthSydney - West

Melbourne - FringeHong Kong - Cargo Lift Accees*

Delhi - SouthSydeny - Southwest

Delhi - WestAuckland - North Shore**

Shanghai - Pudong New AreaDelhi - East

Melbourne - East & South EastAuckland - Former AucklandCity**

Auckland - Manukau**Wellington - Ngauranga**

Melbourne - NorthBeijing - Tianzhu

Melbourne - WestGuangzhou - GET DDWellington - Petone**

Wellington - Seaview**Delhi - NH 24

Beijing - TongzhouDelhi - NorthDelhi - NH 8 Delhi - NH 1

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50

Warehouse Monthly Gross Rents (US$ psf)



INTERNATIONAL COMPARISONSINGLE-USER FACTORY

SINGLE-USER FACTORY LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS

CITY

VALUE AS OF MARCH 2012 (US$) 12-MONTH FORECAST (US$) BASIS OF LAND AND CAPITAL VALUES

LAND VALUE1

(PSF)



LAND VALUE1 (PSF)



LAND TENURE (YEARS)

PLOT RATIO

LAND AREA

(SQ FT)

GROSS FLOOR AREA

(SQ FT)

Beijing

Shang Di 60.03 153.19 1.39 61.69 157.77 1.45 60 1.0 100,000 100,000

Yi Zhuang 8.61 70.82 0.74 8.82 72.88 0.77 60 1.0 100,000 100,000

Greater Tokyo

Chiba - Ichikawa 37.43 133.74 - 37.43 133.74 - 60 1.0 100,000 100,000

Chiba - Mihama 18.57 82.84 - 18.57 82.84 - 60 1.0 100,000 100,000

Saitama - Ageo 13.88 77.78 - 13.88 77.78 - 60 1.0 100,000 100,000

Tokyo - Ota 73.22 142.02 - 73.22 142.02 - 60 1.0 100,000 100,000

Yokohama - Naka 36.26 117.68 - 36.26 117.68 - 60 1.0 100,000 100,000

Guangzhou

GETDD 9.54 50.10 0.48 9.58 51.83 0.49 60 1.0 100,000 100,000

Hong Kong3

Low Quality - 251.69 0.94 - 236.59 0.90 60 1.0 100,000 100,000

Mid Quality - 314.81 1.15 - 295.93 1.10 60 1.0 100,000 100,000

Prime Quality - 449.75 1.39 - 422.77 1.34 60 1.0 100,000 100,000

Jakarta

Bekasi 16.26 31.88 - 19.67 33.48 - 60 1.0 100,000 100,000

Karawang 12.26 27.82 0.37 15.37 29.21 0.41 60 1.0 100,000 100,000

Melbourne

East & South East 14.99 74.41 0.61 15.15 75.15 0.62 60 1.0 100,000 100,000

Fringe 44.45 144.47 0.99 44.88 145.92 1.00 60 1.0 100,000 100,000

North 12.87 67.64 0.51 13.00 68.32 0.51 60 1.0 100,000 100,000

West 11.29 53.39 0.50 11.40 53.92 0.50 60 1.0 100,000 100,000

New Delhi

Delhi - NH1 17.03 - 0.23 17.03 - 0.23 60 1.0 100,000 100,000

Delhi - NH8 17.03 19.94 0.30 17.68 21.20 0.30 60 1.0 100,000 100,000

Delhi - NH24 34.05 38.28 0.43 35.36 40.31 0.47 60 1.0 100,000 100,000

Delhi - East 89.96 66.07 0.63 91.11 71.08 0.65 60 1.0 100,000 100,000

Delhi - North 142.62 76.24 0.37 143.87 79.71 0.40 60 1.0 100,000 100,000

Delhi - South 155.70 86.40 0.86 161.47 93.00 0.90 60 1.0 100,000 100,000

Delhi - West 171.85 70.90 0.71 173.00 73.07 0.73 60 1.0 100,000 100,000

Shanghai

Minhang District 21.15 58.04 0.46 21.70 60.47 0.49 60 1.0 100,000 100,000

Pudong New Area 23.10 55.40 0.44 23.40 58.67 0.45 60 1.0 100,000 100,000

Singapore

Central 96.56 181.78 1.33 96.56 176.74 1.31 60 1.0 100,000 100,000

1. Land values are expressed in US$ psf per plot ratio2. Capital values refer to the values of both land and building3. Values provided are for multi-user factory buildings



INTERNATIONAL COMPARISON OF FACTORY LAND VALUES(MARCH 2012)


INTERNATIONAL COMPARISON OF FACTORY CAPITAL VALUES(MARCH 2012)

* Values provided are for multi-user factory buildings

Beijing-Yi ZhuangGuangzhou-GETDD

Melbourne-WestJakarta-KarawangMelbourne-North

Greater Tokyo-Saitama-AgeoMelbourne-East & South East

Jakarta-BekasiDelhi-NH1Delhi-NH8

Greater Tokyo-Chiba-MihamaShanghai-Minhang District

Shanghai-Pudong New AreaDelhi-NH24

Greater Tokyo-Yokohama-NakaGreater Tokyo-Chiba-Ichikawa

Melbourne-FringeBeijing-Shang Di

Greater Tokyo-Tokyo-OtaDelhi-East

Singapore-CentralDelhi-NorthDelhi-SouthDelhi-West

Factory Land Values (US$ psf per plot ratio)

500 100 150 200

Delhi-NH8Jakarta-Karawang

Jakarta-BekasiDelhi-NH24

Guangzhou-GETDDMelbourne-West

Shanghai-Pudong New AreaShanghai-Minhang District

Delhi-EastMelbourne-NorthBeijing-Yi Zhuang

Delhi-WestMelbourne-East & South East

Delhi-NorthGreater Tokyo-Saitama-Ageo

Greater Tokyo-Chiba-MihamaDelhi-South

Greater Tokyo-Yokohama-NakaGreater Tokyo-Chiba-Ichikawa

Greater Tokyo-Tokyo-OtaMelbourne-FringeBeijing-Shang Di

Singapore-CentralHong Kong-Low Quality*Hong Kong-Mid Quality*

Hong Kong-Prime Quality*

0 100 150 200 250 300 350 400 450 500

Factory Capital Values (US$ psf)

50


Delhi - WestDelhi - SouthDelhi - North

Singapore - CentralDelhi - East

Greater Tokyo - Tokyo - OtaBeijing - Shanghai Di

Melbourne - FringeGreater Tokyo - Chiba - IchikawaGreater Tokyo - Yokohama - Naka

Delhi - NH 24Shanghai - Pudong New Area

Shanghai - Minhang DistrictGreater Tokyo - Chiba - Mihama

Delhi - NH 8 Delhi - NH 1

Jakarta - BekasiMelbourne - East & South EastGreater Tokyo - Saitama - Ageo

Melbourne - NorthJakarta - Karawang

Melbourne - WestGuangzhou - GET DD

Beijing - Yi Zhuang

0 50 100 150 200

Factory Land Values (US$ psf per plot ratio)

Hong Kong - Prime Quality*Hong Kong - Mid Quality*Hong Kong - Low Quality*

Singapore - CentralBeijing - Shang Di

Melbourne - FringeGreater Tokyo - Tokyo - Ota

Greater Tokyo - Chiba - IchikawaGreater Tokyo - Yokohama - Naka

Delhi - SouthGreater Tokyo - Chiba - MihamaGreater Tokyo - Saitama - Ageo

Delhi - NorthMelbourne - East & South East

Delhi - WestBeijing - Yi ZhuangMelbourne - North

Delhi - EastShanghai - Minhang District

Shanghai - Pudong New AreaMelbourne - West

Guangzhou - GET DDDelhi - NH 24

Jakarta - BekasiJakarta - Karawang

Delhi - NH 8

0 50 100 150 200 250 300 350 400 450 500




INTERNATIONAL COMPARISON OF FACTORY MONTHLY GROSS RENTS(MARCH 2012)


* Values provided are for multi-user factory buildings

Delhi-NH1

Delhi-NH8

Delhi-NorthJakarta-Karawang

Delhi-NH24

Shanghai-Pudong New AreaShanghai-Minhang District

Guangzhou-GETDD

Melbourne-WestMelbourne-North

Melbourne-East & South East

Delhi-EastDelhi-West

Beijing-Yi ZhuangDelhi-South

Hong Kong-Low Quality*

Melbourne-Fringe

Hong Kong-Mid Quality*Singapore-Central

Beijing-Shang DiHong Kong-Prime Quality*

0.00

Factory Monthly Gross Rents (US$ psf)

0.50 1.00 1.50

Hong Kong - Prime Quality*Beijing - Shanghai Di

Singapore - CentralHong Kong - Mid Quality*

Melbourne - FringeHong Kong - Low Quality*

Delhi - SouthBeijing - Yi Zhuang

Delhi - WestDelhi - East

Melbourne - East & South EastMelbourne - NorthMelbourne - West

Guangzhou - GET DDShanghai - Minhang District

Shanghai - Pudong New AreaDelhi - NH 24

Jakarta - KarawangDelhi - NorthDelhi - NH 8Delhi - NH 1

0.00 0.50 1.00 1.50

Factory Monthly Gross Rents (US$ psf)



INTERNATIONAL COMPARISONMULTI-USER HIGH-SPECS

MULTI-USER HIGH-SPECS AVERAGE MONTHLY GROSS RENTS

CITY

AS OF MARCH 2012 12-MONTH FORECAST BASIS OF RENTAL RATES

AVERAGE MONTHLY GROSS RENT (US$ PSF)

AVERAGE MONTHLY GROSS RENT (US$ PSF)

LEASE TERM

(YEARS)LOCATION

NET FLOOR AREA

(SQ FT)

RENT FREE PERIOD

(MONTH)

Beijing 1.45 1.51 3 Suburban 10,000 1

Hong Kong 2.21 2.10 3 Suburban 10,000 1

Melbourne 1.73 1.73 3 Suburban 10,000 1

New Delhi - NH1 0.27 0.27 3 to 9 Suburban 10,000 Negotiable



New Delhi - East 0.78 0.82 3 to 9 Suburban 10,000 Negotiable

New Delhi - North 0.53 0.53 3 to 9 Suburban 10,000 Negotiable

New Delhi - South 1.04 1.08 3 to 9 Suburban 10,000 Negotiable

New Delhi - West 0.84 0.86 3 to 9 Suburban 10,000 Negotiable

Shanghai 1.36 1.41 3 to 9 Suburban 10,000 1

Singapore1 2.78 2.70 3 Suburban 10,000 1

Sydney 1.18 1.18 3 Suburban 10,000 1

Taipei - Neihu Technology Park 1.08 1.08 3 Suburban 10,000 1

Greater Tokyo - Hakusan 3.41 3.41 3 Suburban 10,000 1

Greater Tokyo - Kanagawa 4.43 4.43 3 Suburban 10,000 1

Greater Tokyo - Yokohama 3.41 3.41 3 Suburban 10,000 1

INTERNATIONAL COMPARISON OF HIGH-SPECS MONTHLY GROSS RENTS(MARCH 2012)

1. With effect from May 2012, the basket used to compute Singapore’s high-specs industrial rents has been expanded to include an array of both independent high-specs industrial buildings and business parks.

New Delhi - NH1

New Delhi - NH8

New Delhi - NH24

New Delhi - North

New Delhi - East

New Delhi - West

New Delhi - South

Taipei - Neihu Technology Park

Sydney

Shanghai

Beijing

Melbourne

Hong Kong

Singapore

Greater Tokyo - Hakusan

Greater Tokyo - Yokohama

Greater Tokyo - Kanagawa

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00

High-Specs Average Monthly Gross Rents (US$ psf)

Greater Tokyo - Kanagawa

Greater Tokyo - Yokohama

Greater Tokyo - Hakusan

Singapore

Hong Kong

Melbourne

Beijing

Shanghai

Sydney

Taipei - Neihu Technology Park

New Delhi - South

New Delhi - West

New Delhi - East

New Delhi - North

New Delhi - NH 24

New Delhi - NH 8

New Delhi - NH 1

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00

High-Specs Average Monthly Gross Rents (US$ psf)



LOCAL MARKET NORMThe 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 LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS1

CITY LOCAL CURRENCY

IN LOCAL CURRENCY AS OF MARCH 2012 IN US$ AS OF MARCH 2012

BASIS OF LAND, CAPITAL VALUES AND MONTHLY GROSS RENTS

(LOCAL MARKET NORM)

LAND VALUE2

(PSF)



LAND VALUE2 (PSF)



LAND TENURE (YEARS)

PLOT RATIO

LAND AREA

(SQ FT)

GROSS FLOOR AREA

(SQ FT)

Auckland4

Former Auckland City

NZ$ 32.90 155.40 0.82 26.89 127.01 0.67 Freehold 0.5 30,000 15,000

Manukau NZ$ 27.56 141.55 0.76 22.53 115.69 0.62 Freehold 0.5 100,000 50,000

North Shore NZ$ 39.41 159.02 0.83 32.21 129.97 0.67 Freehold 0.5 105,000 52,500

Beijing

Tianzhu CNY 112.95 520.16 3.12 17.94 82.64 0.50 50 0.7 150,000 105,000

Tongzhou CNY 67.83 396.75 2.78 10.78 63.03 0.44 50 0.9 120,000 108,000

Greater Tokyo5

Chiba-Urayasu JPY - - - - - - Freehold 2.0 53,820 107,640

Kawasaki - Higashi Ogishima

JPY 2,957.00 12,170.00 93.00 35.88 147.66 1.13 Freehold 2.0 1,076,390 3,229,170

Tokyo - Ariake JPY 13,493.00 21,646.00 157.00 163.71 262.63 1.90 Freehold 2.0 107,639 215,278

Tokyo - Heiwajima JPY 9,479.00 19,416.00 169.00 115.01 235.57 2.05 Freehold 2.0 1,614,585 4,843,755

Tokyo - Shinsuna JPY 16,656.00 22,203.00 149.00 202.09 269.39 1.81 Freehold 2.0 215,278 430,556

Yokohama - Daikokufuto

JPY 1,847.00 13,192.00 132.00 22.41 160.06 1.60 Freehold 2.0 107,639 430,556

Guangzhou

GETDD CNY 56.67 269.50 2.85 9.00 42.82 0.45 50 1.5 150,000 225,000

Hong Kong6

Ramp Access HK$ - 2,869.20 10.83 - 369.53 1.39 N.A N.A N.A N.A

Cargo Lift Access HK$ - 2,716.40 7.45 - 349.85 0.96 N.A N.A N.A N.A

Jakarta

Bekasi Rp 139,321.00 204,461.00 - 14.39 21.12 - 30 2.4 10,000 24,000

Melbourne

East & South East A$ 19.74 102.19 0.66 20.53 106.30 0.69 Freehold 0.6 40,000 24,000

Fringe A$ 58.53 213.68 1.12 60.88 222.27 1.17 Freehold 0.6 30,000 18,000

North A$ 16.95 92.90 0.54 17.63 96.63 0.56 Freehold 0.6 40,000 24,000

West A$ 14.86 78.97 0.56 15.46 82.14 0.58 Freehold 0.6 30,000 18,000

New Delhi

Delhi - NH1 Rs 1,300.00 - 13.00 25.41 - 0.25 99 0.6 15,000 9,000

Delhi - NH8 Rs 1,660.00 1,500.00 18.00 32.45 29.32 0.35 99 0.6 15,000 9,000

Delhi - NH24 Rs 2,580.00 3,000.00 27.00 50.43 58.64 0.53 99 0.6 15,000 9,000

Delhi - East Rs 7,600.00 5,000.00 37.00 148.56 97.74 0.72 Freehold 0.6 5,000 3,000

Delhi - North Rs 10,880.00 6,000.00 23.00 212.68 117.29 0.45 Freehold 0.6 15,000 9,000

Delhi - South Rs 13,900.00 6,000.00 54.00 271.72 117.29 1.06 Freehold 0.6 10,000 6,000

Delhi - West Rs 14,700.00 4,875.00 43.00 287.35 95.30 0.84 Freehold 0.6 7,000 4,200

Shanghai

Pudong New Area CNY 286.06 436.72 3.90 45.45 69.38 0.62 50 0.6 150,000 90,000

Singapore

East S$ 88.47 198.62 1.44 70.37 157.99 1.15 30+30 2.5 120,000 300,000

Sydney

South A$ 89.25 158.25 1.10 92.84 164.61 1.14 Freehold 1.2 220,000 264,000

Southwest A$ 24.39 126.20 0.79 25.37 131.27 0.82 Freehold 1.2 60,000 72,000

West A$ 32.60 126.30 0.90 33.91 131.38 0.93 Freehold 1.2 430,000 516,000

Continued on next page >



LOCAL MARKET NORM


SINGLE-USER WAREHOUSE LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS1

CITY LOCAL CURRENCY

IN LOCAL CURRENCY AS OF MARCH 2012 IN US$ AS OF MARCH 2012

BASIS OF LAND, CAPITAL VALUES AND MONTHLY GROSS RENTS

(LOCAL MARKET NORM)

LAND VALUE2

(PSF)



LAND VALUE2 (PSF)



LAND TENURE (YEARS)

PLOT RATIO

LAND AREA

(SQ FT)

GROSS FLOOR AREA

(SQ FT)

Wellington

Ngaurang NZ$ 53.42 121.35 0.75 43.66 99.18 0.62 Freehold 0.5 70,000 35,000

Petone NZ$ 48.77 109.74 0.68 39.86 89.69 0.55 Freehold 0.5 100,000 50,000

Seaview NZ$ 26.71 97.82 0.64 21.83 79.95 0.52 Freehold 0.5 100,000 50,000

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 building4. 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

< Continued from previous page



SINGLE-USER FACTORY

SINGLE-USER FACTORY LAND VALUES, CAPITAL VALUES AND MONTHLY GROSS RENTS1

CITY LOCAL CURRENCY

IN LOCAL CURRENCY AS OF MARCH 2012 IN US$ AS OF MARCH 2012 BASIS OF LAND, CAPITAL VALUES AND

MONTHLY GROSS RENTS (LOCAL MARKET NORM)

LAND VALUE2

(PSF)



LAND VALUE2 (PSF)

CAPITAL VALUE3

(PSF)


LAND TENURE (YEARS)

PLOT RATIO

LAND AREA

(SQ FT)

GROSS FLOOR AREA

(SQ FT)

Beijing

Shang Di CNY 318.86 730.48 7.02 50.66 116.05 1.12 50 1.1 39,000 429,000

Yi Zhuang CNY 56.75 437.03 4.89 9.02 69.43 0.78 50 1.3 42,000 54,600

Greater Tokyo

Chiba - Ichikawa JPY 3,673.00 10,498.00 - 44.56 127.37 - Freehold 2.0 215,278 430,556

Chiba - Mihama JPY 2,319.00 9,104.00 - 28.14 110.46 - Freehold 2.0 32,292 64,584

Saitama - Ageo JPY 1,733.00 8,547.00 - 21.03 103.70 - Freehold 2.0 32,292 64,584

Tokyo - Ota JPY 9,893.00 16,722.00 - 120.03 202.89 - Freehold 2.0 16,146 32,292

Yokohama - Naka JPY 3,932.00 10,777.00 - 47.71 130.76 - Freehold 2.0 107,634 215,268

Guangzhou

GETDD CNY 56.67 269.50 2.73 9.00 42.82 0.43 50 1.5 150,000 225,000

Hong Kong4

Low Quality HK$ - 1,954.23 7.26 - 251.69 0.94 N.A N.A N.A N.A

Mid Quality HK$ - 2,444.38 8.91 - 314.81 1.15 N.A N.A N.A N.A

Prime Quality HK$ - 3,492.09 10.81 - 449.75 1.39 N.A N.A N.A N.A

Jakarta

Bekasi Rp 139,321.00 250,929.00 - 14.39 25.92 - 30 2.4 15,000 36,000

Karawang Rp 98,917.00 195,167.00 3,383.00 10.22 20.16 0.35 30 2.4 70,000 168,000

Melbourne

East & Southeast A$ 19.74 102.19 0.66 20.53 106.30 0.69 Freehold 0.6 40,000 24,000

Fringe A$ 58.53 213.68 1.12 60.88 222.27 1.17 Freehold 0.6 30,000 18,000

North A$ 16.95 92.90 0.54 17.63 96.63 0.56 Freehold 0.6 40,000 24,000

West A$ 14.86 78.97 0.56 15.46 82.14 0.58 Freehold 0.6 30,000 18,000

New Delhi

Delhi - NH1 Rs 1,300.00 - 14.00 25.41 - 0.27 99 1.25 15,000 18,750

Delhi - NH8 Rs 1,300.00 1,500.00 18.00 25.41 29.32 0.35 99 1.25 15,000 18,750

Delhi - NH24 Rs 2,600.00 2,880.00 26.00 50.82 56.30 0.51 99 1.25 15,000 18,750

Delhi - East Rs 7,800.00 5,200.00 38.00 152.47 101.65 0.74 Freehold 1.25 5,000 6,250

Delhi - North Rs 11,400.00 6,000.00 22.00 222.85 117.29 0.43 Freehold 1.25 15,000 18,750

Delhi - South Rs 13,500.00 6,800.00 52.00 263.90 132.93 1.02 Freehold 1.25 10,000 12,500

Delhi - West Rs 14,900.00 5,580.00 43.00 291.26 109.08 0.84 Freehold 1.25 7,000 8,750

Shanghai

Minhang District CNY 122.11 341.40 2.88 19.40 54.24 0.46 50 1.0 150,000 150,000

Pudong New Area CNY 133.40 379.02 3.26 21.19 60.22 0.52 50 1.0 150,000 150,000

Singapore

Central S$ 127.78 207.76 1.52 101.64 165.26 1.21 30+30 2.5 100,000 250,000

1. Values and rents may not be quoted in $ psf in local market practice 2. Land values are expressed as $ psf per plot ratio3. Capital values refer to the values of both land and building4. Values provided are for multi-user factory buildings

LOCAL MARKET NORM



DEF INITION AND TERMINOLOGY

1. MULTI-NATIONAL CORPORATION (MNC)

A MNC is defined as a large company that has operations in multiple nations and that requires industrial space.

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.

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.

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.

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.



GREATER CHINA

Beijing, China502 Tower W3, Oriental Plaza No 1 East Changan Avenue Dongcheng DistrictBeijing 100738Tel: +86 10 8518 1633Fax: +86 10 8518 1638Carlby XieDirector, Research [email protected]

Shanghai, China12F Hong Kong New World Tower300 Huaihai Zhong Road Shanghai 200021Tel: +86 21 6141 3688 Fax: +86 21 6141 3699 James ShepherdSenior Director, Research & Advisory, Corporate and Institutional Services, [email protected]

Guangzhou, ChinaRoom 702 Teem Tower208 Tianhe RoadGuangzhou 510620People’s Republic of ChinaTel: +86 20 3819 3888Fax: +86 20 3819 3899Bryan ChanDirector, Research & [email protected]

Hong Kong, HK SAR5701 Central Plaza18 Harbour Road, WanchaiCompany Licence No. C-006052Tel: +852 2828 9888Fax: +852 2828 9899Simon LoExecutive Director, Research & Advisory, [email protected]

Taipei, Taiwan49F Taipei 101 TowerNo 7 Xin Yi Road Sec 5Taipei 110 Taiwan ROCTel: +886 2 8101 2000Fax: +886 2 8101 2345Paul LeeDirector, [email protected]

NORTH ASIA

Tokyo, JapanHalifax Building, 3-16-26, Roppongi Minato-ku, Tokyo 106-0032 JapanTel: +81 3 5563 2111Fax: +81 3 5563 2100Yumiko YasudaHead, [email protected]

SOUTHEAST ASIA

Jakarta, Indonesia10F World Trade CentreJalan Jenderal Sudirman Kav 29-31 Jakarta 12920Tel: +62 21 521 1400Fax: +62 21 521 1411Ferry SalantoAssociate Director, [email protected]

Singapore 1 Raffles Place#45-00 One Raffles PlaceSingapore 048616Tel: +65 6223 2323Fax: +65 6222 4901Chia Siew ChuinDirector, Research & [email protected]

INDIA

Gurgaon TechnoPolis BuildingFirst Floor, DLF Golf Course Main Road Sect. 54Gurgaon 122002Tel: 91 124 456 7500Fax: 91 124 456 7502Surabhi Arora, MRICSAssociate Director, [email protected]

AUSTRALASIA

Melbourne, AustraliaLevel 32 Optus Centre 367 Collins StreetMelbourne VIC 3000, Australia Tel: +61 3 9629 8888Fax: +61 3 9629 8549Nerida ConisbeeNational Director, [email protected]

Sydney, AustraliaLevel 12, Grosvenor Place225 George StreetSydney NSW 2000Tel: +61 2 9257 0222Fax: +61 2 9251 3297Mathew TillerManager, Research [email protected]

Auckland, New ZealandSAP Tower Level 27, 151 Queen Street, Auckland CityTel: +64 9 358 1888Fax: +64 9 358 1999Alan McMahonNational Director, Research and [email protected]

Wellington, New ZealandLevel 10, 36 Customhouse QuayWellingtonTel: +64 4 473 4413 Fax: +64 4 499 1550Alan McMahonNational Director, Research and [email protected]

For further details, please contact:

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