asia pacific real estate investment q4-2009

Asia Pacifi c Real Estate InvestmentMarket Bulletin 2009

FOURTH QUARTERFOFOFOFOFOFOFOFOFOFOFOURURURURURURURURURURURTHTHTHTHTHTHTHTHTHTHH QQQQQQQQQQQUAUAUAUAUAUAUAUAUAUAUARTRRTRTRTRTRTRTRTRTRTERERERERERERERERERERER

COLLIERS INTERNATIONAL | REGIONAL RESEARCH2

INVESTMENT MARKET OVERVIEW | FOURTH QUARTER | 2009

Regional Overview .................................................................................. 3-4

Greater China ........................................................................................ 5-10

Beijing, China ....................................................................................................5

Chengdu, China ...............................................................................................6

Guangzhou, China ...........................................................................................7

Shanghai, China ................................................................................................8

Hong Kong SAR, China ..................................................................................9

Taipei, Taiwan ................................................................................................. 10

North Asia ............................................................................................11-12

Tokyo, Japan ................................................................................................... 11

Seoul, South Korea ....................................................................................... 12

Southeast Asia ......................................................................................13-17

Jakarta, Indonesia .......................................................................................... 13

Manila, Philippines ......................................................................................... 14

Singapore ....................................................................................................... 15

Bangkok, Thailand ......................................................................................... 16

Ho Chi Minh City, Vietnam ......................................................................... 17

India ..............................................................................................................18

Australasia .............................................................................................19-26

Adelaide, Australia ........................................................................................ 19

Canberra, Australia ...................................................................................... 20

Melbourne, Australia .................................................................................... 21

Perth, Australia .............................................................................................. 22

Sydney, Australia ........................................................................................... 23

Auckland, New Zealand .............................................................................. 24

Wellington, New Zealand ........................................................................... 25

A P P E N D I X

Major Market News ............................................................................28-35

Greater China ......................................................................................... 28-30

North Asia ..................................................................................................... 31

South Asia ................................................................................................ 32-33

India ................................................................................................................. 34

Australasia ..................................................................................................... 35

Contacts ................................................................................................36-37

CONTENTS

COLLIERS INTERNATIONAL | REGIONAL RESEARCH 3


EXECUTIVE SUMMARY

The real estate investment market in the region continued to benefit from the

improving sentiment and the gradual economic recovery seen in the second

half of 2009. The massive flow of liquidity and the ease of credit initiated by

a series of fiscal and monetary stimulus measures not only kept borrowing

rates at low levels, but also underpinned investment demand for various asset

classes, including real estate.

In terms of overall activity, the region experienced a significant surge in sales

transaction volumes during the second half of 2009. Rebounding from the

trough seen in 1Q2009, the aggregate value of investment sales transactions

increased nearly four fold to reach the levels seen over the same period before

the onset of the financial crisis. The key cities in China, particularly Beijing

and Shanghai, remained the key contributors to the upsurge in market volume

during the second half of 2009, despite the fact that a number of measures

have been implemented by the Central Government to curb speculative

purchases. As usual, Hong Kong continued to benefit from the growing

appetite attributed to a massive group of buyers in the mainland. Elsewhere

in the region, the pace of recovery in terms of volume was generally slower

than expected. In the case of Australasia, the overall volume in the second

half of 2009 remained 50% below the levels seen before the financial crisis

due to rate hikes and sales withdrawals by individual vendors.

Although there was a rebound in both capital values and transactional volume

during the second half of 2009, the leasing market is yet to catch up with the

sales market in general. Rentals continued to trend downwards as occupational

demand remained fragile. Rentals in individual centres continued to face

the challenge of higher-than-average vacancy rates in the secondary market

and plentiful new supply coming on line. As such, average investment yields

in the region were compressed further by about 50 basis points (bps) during

the second half of 2009, although Australasia saw a mild expansion of about

3 bps.

By asset type and location, office developments in the Greater China region

have been favoured by the market amid expectations of a prospective rental

catch-up and long-term economic growth in the region. A similar trend was

seen in the statistics compiled by Real Capital Analytics. Looking at the office

sector, as of January 2010, Shanghai, Beijing and Hong Kong were among the

top five cities with the highest volume of sales transactions valued at US$10

million or above over the past 12 months. Tokyo and Seoul continued to

stay on top of the list with aggregate volumes of US$11.1 billion and US$4.2

billion, respectively, over the same period.

REGIONAL OVERVIEW

Greater China Region Stolen the Limelight

Investment Yields

Offi ce Developments Gained Market Favour



Looking forward, the prevailing positive market sentiment is expected to

continue in 2010 and the various governments in the region are anticipated

to keep market liquidity at high levels over the near to medium term. As such,

a dramatic expansion of investment yields is unlikely, particularly when rentals

are yet to catch up in most of the centres. However, with the gradual economic

recovery, together with the real growth in real estate demand as a result of job

growth and business expansion, the leasing market might hit bottom in the

second half of 2010. As such, investment grade office assets will continue to

be sought after by investors over the next 6-12 months.

REGIONAL OVERVIEW

Market Outlook

PROPERTY INVESTMENT YIELDS4Q 2009 (% per annum)

City Offi ce Residential Retail Industrial

Greater China

Beijing 7.2% 3.0% 6.5% -

Chengdu 8.0% - - -

Guangzhou 5.9% 3.5% 5.3% 7.0%

Shanghai 6.8% 3.4% 6.5% 8.6%

Hong Kong 3.5% 2.4% 3.8% 5.2%

Taipei 3.5% 3.1% 4.1% 4.3%

North Asia

Seoul #4.6% - #3.6% -

Tokyo 4.8% 6.5% - 6.5%

Southeast Asia

Jakarta 8.2% 10.0% 4.4% 8.0%

Manila 10.6% 6.5% - -

Singapore *3.9% *1.9% *7.1% **6.0%

Bangkok 7.5% 4.9% 8.2% 10.9%

Ho Chi Minh City - - - -

India

Bangalore 11.3% 5.3% 14.0% -

Chennai 11.3% 5.3% 14.0% -

Mumbai 10.3% 3.3% 11.0% -

New Dehli 9.8% 3.8% 11.0% -

Australasia

Adelaide 8.0% - - 8.4%

Canberra 7.8% - - -

Melbourne 7.9% - - 8.8%

Perth 8.0% - - 9.0%

Sydney 7.7% - - 8.5%

Auckland 8.4% - 7.0% 8.1%

Wellington 8.1% - - -

Source: Colliers

Source: Real Capital Analytics, January 2010Note: Sales transactions closed in the past 12 months valued

at US$10 million or greater

��

��

��

��

��

��

��

��

��

��

��

��

��

��

�� !��

"��

"� ��

��!��

#��

$��

"�%�&��

��

#�'��

(��

��

��

)

*+)))

,+)))

-+)))

.+)))

/)+)))

/*+)))��

��

��

��

��

��

��

��

��

��

��

��

��

�$$0�1�0"21��1"��#�1��3#"�#��0�"�4#��'�5�'�3� ��/*��6

* Strata net yield** Strata net yield for 60-year leasehold multi-user upper fl oor space# 3Q 2009



EXECUTIVE SUMMARY

/7�/8..

97�/8.8

/7�/88/

97�/88*

/7�/88,

97�/88:

/7�/88;

97�/88.

/7�*)))

97�*))/

/7�*))9

97�*)),

/7�*))-

97�*));

/7�*))8

)<

,<

.<

/*<

/-<

*)<

*,<

*.<

<��

/=>1#3��1"&0" �3#�1

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

<��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

3��55�'� 3��

�10?0" ��3��13�>�>01�&�

CHINA - BEIJING

On the back of the consistent and stable macro-economic policies, Beijing’s

real estate market continued to witness an increasing level of investment

activities, with 11 en bloc or significant sales transactions recorded in the office

sector during the second half of 2009. In addition to the growing investment

transaction volume, the profile of investors became more diversified, with two of

the largest of the transactions by value revealing a turnaround in the domination

among buyers of State-Owned Enterprises (SOEs) in the first three quarters of

2009 to domestic listed developers and investors. Wharf sold its 87.5% stake in

Beijing Capital Times Square to Beijing Huarong Infrastructure Investment Co.

for a total consideration of RMB2.708 billion and Bluewater sold Nexus Centre,

with a total GFA of 103,340 sq m, to SOHO China for RMB2.34 billion.

In the second half of 2009, three major en bloc sales transactions of luxury

residential properties were concluded, suggesting that many investors continued to

be interested in Beijing’s residential investment market. International developers

and funds became very active, as evidenced by the acquisitions of projects under

development by Shui On Construction and Materials Limited (SOCAM) and

Gaw Capital. Meanwhile, the retail property investment market continued to be

dominated by domestic enterprises, especially those with an SOE background,

and financial institutions.

In the second half of 2009, the Central Government circulated two notices to

further tighten management of land supply in a bid to curb speculative purchases

in the land investment market. This should further consolidate Beijing’s real

estate market, especially the residential sector, and the market should be more

divergent, and dominated by developers with healthier and stronger financial

conditions. In addition, the establishment of a consortium by several developer

companies in order to get a lot in the local market, especially within city centres,

should become a trend given continued growing land sales prices.

MAJOR INVESTMENT TRANSACTIONS

Development Floor Area Lump Sum Price Seller Buyer

(sq m) (RMB million) (US$ million)

Offi ce

Sunny Region 53,176 1,400.00 205.03 Chang Qing Co.,Ltd. CITIC Securities

One Square 60,000 1,740.00 254.83 Nan Fung Group Bank Of China Beijing Branch

Beijing Capital Times Square 120,000 2,708.00 396.59 Wharf Beijing Huarong

Infrastructure Investment Co.

Nexus Center 103,340 2,340.00 342.70 Bluewater SOHO China

Raycom Infotech Park Tower D 41,000 750.00 109.84 Raycom Sohu

Haitian Square 200,000 2,000.00 292.90 Beijing Haitian Square Real Estate Guangyao Dongfang Group

Development Company

Residential

Pacifi c Century Place Phase 2 / 57,700 800.00 117.16 Pacifi c Century Premium Shui On Construction

No. 4 Gongti Beilu Developments Limited and Materials Limited

Regal Garden / No. 9 Gongyuan Xijie 42,000 750.00 109.84 Golife Concepts Holdings Beijing Yinzuo Xingye Agency

Company Limited Real Estate

Embassy House / Dongzhimenwai 48,248 1,000.00 146.45 Hines Gateway Captial

Xiaojie No. 18

Source: Colliers

Source: The People’s Bank of China

Note: US$1 = RMB 6.8282



/7�/8..

97�/8.8

/7�/88/

97�/88*

/7�/88,

97�/88:

/7�/88;

97�/88.

/7�*)))

97�*))/

/7�*))9

97�*)),

/7�*))-

97�*));

/7�*))8

)<

,<

.<

/*<

/-<

*)<

*,<

*.<

<��

/=>1#3��1"&0" �3#�1

)<

*<

,<

-<

.<

/)<

/*<

/,<

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

�55�'�

��1" &@��3��13�>�>01�&�

CHINA - CHENGDU

As one of the most popular cities in southwestern China, Chengdu has been

favoured by a number of real estate investors, with many multinational

corporations, local and overseas tycoons, and private investors setting up business

in the city, providing strong support to the local office market. It is understood

that the take-up of prime office space in Chengdu has been at 60,000-139,000

sq m per annum.

According to our research, this take-up of office space will increase by about 20%

per annum over the coming years, translating into demand for 607,200 sq m of

office space. However, with supply in the market in the order of 2.32 million sq m,

average vacancy rates will be over 73%, creating serious oversupply, causing both

office rentals and capital values to suffer from substantial downward pressure over

the next three years. However, given the long-term growth potential in Chengdu,

the office market continues to present opportunities to a number of long-term

investors as the existing supply is expected to be absorbed gradually over time.

In the retail sector, the highlight of the market was the launch of Silver Stone

for sale in December 2009. The project is one of the city’s most famous mixed

commercial developments, comprising an office block, a five-star hotel and an

upper-end shopping mall




Offi ce

Tian Fu Avenue 3,000 23.40 3.43 Zhong Xin Mei Di Real Estate Local company

Development Co,.Ltd

Dong Avenue 20,000 1,500.00 219.68 Hua Yang Nian Real Estate Local investors

Co.,Ltd

Ren Min South Road 60,000 4,200.00 615.10 Xin Xi Wang Real Estate Local investors

Development Co,.Ltd

Source: Colliers


Note: US$1 = RMB 6.8282



EXECUTIVE SUMMARY

CHINA - GUANGZHOU

The stimulus measures gradually took effect in the second half of 2009.

Since the minimum downpayment was lowered to 20%, more prospective

purchasers have been prompted to enter the market, thus leading to an increase

in activity in the sales market during the period.

Despite the substantial accumulated price growth, property prices continued to

remain on an upward trend due to the sustained buying interest among both

foreign and domestic investors. Some of the latest sales transactions included

the en bloc transaction of Kaisa Plaza and the acquisition of five floors in Nanya

Zhong He Plaza by the Guangdong Development Bank.

Although tightening measures were implemented by the Government, property

developers determined that they would go ahead with their investment plans by

building up their land banks for development. One of the most notable sales

transactions was the successful acquisition by a consortium comprising R&F

Properties, Agile Property and Country Garden of a plot of land in Asian Games

City. With a total site area of 2.64 million sq ft, the site was sold for RMB25.5

billion, a record high land price in China.

Looking ahead, the total volume of sales transactions in the local real estate

market is expected to slow over the coming few months due to the cooling, anti-

speculation measures implemented recently by the Government. Meanwhile, with

expectations of a higher interest rate cycle, the real estate market as a whole will

see additional downward pressure over the near term.

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

<��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

3��55�'� 0��3��

@#" A��@��3��13�>�>01�&�

/7�/8..

97�/8.8

/7�/88/

97�/88*

/7�/88,

97�/88:

/7�/88;

97�/88.

/7�*)))

97�*))/

/7�*))9

97�*)),

/7�*))-

97�*));

/7�*))8

)<

,<

.<

/*<

/-<

*)<

*,<

*.<

<��

/=>1#3��1"&0" �3#�1

Source: Colliers




Offi ce

R&F Yingyue International 12,000 300.00 43.94 R&F Group Infi nitus (China) Co Ltd

Nanya Zhong He Plaza 11,941 346.29 50.71 Nanya Group Guangdong

Development Bank

International Creative Valley 4,561 47.00 6.88 KWG Property IT Company

International Creative Valley 1,000 14.50 2.12 KWG Property Individual

Kaisa Plaza 117,575 2,817.50 412.63 Kaisa Group Foreign Insurance Company

Offi ce & Retail

R&F Yingyue International 16,000 420.00 61.51 R&F Group Shanghai Pudong

Development Bank

Residential

Gold Arch Residence 186 6.39 0.94 Individual Individual


Note: US$1 = RMB 6.8282



CHINA - SHANGHAI

/7�/8..

97�/8.8

/7�/88/

97�/88*

/7�/88,

97�/88:

/7�/88;

97�/88.

/7�*)))

97�*))/

/7�*))9

97�*)),

/7�*))-

97�*));

/7�*))8

)<

,<

.<

/*<

/-<

*)<

*,<

*.<

<��

/=>1#3��1"&0" �3#�1Due to abundant liquidity as a result of the Central Government’s economic

stimulus policies, Shanghai’s investment sales market became much more

active during the second half of 2009. Most buyers were domestic investors or end-

users with strong balance sheets. Commercial properties were more popular than

residential in terms of the number of sales transactions during the period.

Recent office transactions included the sale of the 18th floor of Shui-On Plaza at

a price of RMB52,000 per sq m in late December and the acquisition of a 30%

stake at K. Wah Centre by K. Wah at an average price of around RMB36,000 per

sq m. Meanwhile, in Pudong Lujiazui, the Agriculture Bank of China purchased

one tower of Pujiang Shuanghui Towers for RMB4.83 billion in September

2009. The floors from the 1/F to the 41/F in the other tower had been acquired

previously at a price of RMB3.77 billion. In addition, a major portion of Pufa

Tower was sold to the Hainan Air Group in October 2009 for RMB1.5 billion.

In August 2009, SOHO made its first investment deal in Shanghai by acquiring

The Exchange on Nanjing West Road for RMB2.45 billion. The building has

an above ground GFA of 71,671 sq m.

There were also a couple of notable retail transactions during 2H2009, including

the sale of InPoint, an 11,000 sq m retail property near Nanjing West Road, for

an average price of RMB45,000 per sq m in October 2009, as well as the sale of

the 3,000 sq m retail facility of Jinlin Tiandi in November 2009 at a total price

of RMB400 million. In the residential sector, the 27-storey serviced apartment

block comprising 103 units at Shama Luxe in Xintiandi was sold for RMB928

million in December 2009.

Looking ahead, it is likely that the volume of market activity will remain buoyant

throughout 2010. Office investment yields, currently fetching around 7.0%,

are predicted to edge down further due to the sustained buying interest in the

marketplace.



Offi ce

Pujiang Shuanghui Towers 189,445 8,476.00 1,241.32 CITIC Pacifi c /CSSC Agriculture Bank of China

Pufa Tower 41,773 1,475.00 216.02 Shanghai Guosheng Hainan Air Group

The Exchange 71,671 2,450.00 358.81 Morgan Stanley SOHO China

Residential

Shama Luxe at Xintiandi 15,472 928.00 135.91 Mirae Asset Maps Investment SOCAM

Retail

Jinlin Tiandi 3,167 400.00 58.58 Undisclosed A Singapore Fund

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

<��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

3��55�'� 0��3��

��#" �#0��3��13�>�>01�&�

Source: Colliers



Note: US$1 = RMB 6.8282



EXECUTIVE SUMMARY

HONG KONG

Despite the pre-emptive measures implemented by the HKMA, the real estate

investment market showed no signs of significant consolidation in terms of

the number of sales transactions across the various property sectors. First, thanks

to the continued inflow of capital, the average cost of capital came down further

during 2H2009. For example, the three-month Hong Kong interbank offered

rates (3M-HIBOR) fell 22 basis points to 0.14% as at the end of December 2009.

As such, positive carry emerged in the prime office market as mortgage rates for

commercial developments, based on a premium of 150 to 200 basis points above

3M-HIBOR, remained below prevailing office rental yields during the period.

Second, a group of cash-rich private investors continued to dominate the bulk

of activity in the investment market. Fundamentally, the real estate investment

market in the second half of 2009 was equity- rather than debt-driven, as it was

before the financial crisis hit in 3Q2008. Prime office units in traditional business

districts and G/F shops remained the most popular targets for most investors. In

the office sector, a batch of strata-title office units at Grand Millennium Plaza in

Sheung Wan was acquired by investors from mainland China and Taiwan, as well

as Hong Kong. In 4Q2009, a Taiwanese company bought two strata-title floors

in the low block of Grand Millennium Plaza for HK$332 million, representing

an average unit price of HK$11,388 per sq ft. In the retail sector, the key sales

transaction was the acquisition of The Pemberton, a vertical retail block in Central

with a total floor area of 70,000 sq ft, by a real estate fund for a lump sum of

HK$344 million in December 2009.

Looking ahead, the local real estate investment market is predicted to perform

better in 2010 than in 2009, although there are a number of uncertainties that

might affect the pace of recovery going forward. Obviously, the key risk factor for

local property prices is the reversal of capital flow. Assuming that the volume of

liquidity will remain in the system over the medium term, say 6-12 months, and

the average cost of capital continues to stay low, further capital growth in the

real estate sector is expected to be maintained over the next 12 months. Property

investment yields will remain compressed unless there is a sharp rental catch up

in the leasing market during the same period. Office investment yields for quality

buildings in prime locations will stay below the market average of 3.5%.



(sq ft) (HK$ million) (US$million)

Offi ce

27-28/F, Low Block, Grand Millennium Plaza 29,160 332.10 42.58 MGPA Guotai Junan

33/F, Cosco Tower 20,506 253.50 32.50 GIC Local investment company

Retail

G/F, 6-8 Canton Road 1,520 843.00 108.08 Local investor Emperor International

Holdings Ltd

The Pemberton 70,000 344.38 44.15 Local investor AEW

Industrial

Universal Industrial Building Undisclosed 468.00 60.00 Excel Vast (Hong Kong) Ltd Trinity Elite International Ltd

Sunhing Chekiang Godown 252,756 390.00 50.00 Sunhing Group Olympic Creation Ltd

/7�/8..

97�/8.8

/7�/88/

97�/88*

/7�/88,

97�/88:

/7�/88;

97�/88.

/7�*)))

97�*))/

/7�*))9

97�*)),

/7�*))-

97�*));

/7�*))8

)<

,<

.<

/*<

/-<

*)<

*,<

<��

*.<

��" ��" �9=��"��0��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

<��

3��55�'� 0��3��

��" ��" ��3��13�>�>01�&�

Source: Rating and Valuation Department, HKSAR Government

Source: The Hong Kong Monetary Authority

Note: US$1 = HK$7.8



TAIWAN - TAIPEI

Thanks to the relaxed monetary policies implemented by the Government

and the gradual recovery of the external economic environment, the local

real estate investment market benefitted from an increase in the total volume of

sales transactions. According to our research, the real estate investment market

saw total turnover reach NT$61.4 billion in the second half of 2009. Insurance

companies continued to be the key players as they have a vast amount of spare

cash to invest. Compared to other financial investment vehicles, commercial real

estate continued to be favoured by a number of insurance companies looking for

a stable rental income stream over time.

The notable deals were the acquisition of Asia Plaza by Shin Kong Life for

NT$11.5 billion and the sale of Cashboxparty KTV retail building to Cathay Life

for NT$3 billion. Meanwhile, Nanshan Life acquired Rich 19 office in Taichung

for NT$2.7 billion and Highwealth Construction purchased the Yi Jin Office

building in Taipei and the Asia Rich Tower in Taichung for a total consideration

of NT$3.1billion.

Institutional investors continued to stay on the sidelines during 2H2009.

However, due to the sustained low interest rate environment, flexible loan-to-

value ratios at 70%-80%, the closer collaboration between Taiwan and mainland

China, and the fact that current commercial real estate prices are relatively lower

than in other countries in the region, overseas institutional investors have started

planning a comeback.

Given the ongoing recovery of the global economy and the positive impact

attributed to the signing of the Economic Co-operation Framework Agreement

(ECFA) with mainland China, the local investment market is expected to grow

in 2010. Real estate prices are predicted to rise thanks to keen buying interest

among prospective investors going forward.



(ping) (NT$ million) (US$ million)

Offi ce

San Gong International Building 2,033 1,070.00 33.41 Hua Nan Bank MassMutual Mercuries Life

Yi Jin Offi ce building Undisclosed 1,869.00 58.35 Jye Tai Precision Industrial Highwealth Construction

Co., Ltd

Rich 19 offi ce Undisclosed 2,652.00 82.80 Highwealth Construction Nan Shan Life Insurance

Asia Rich Tower Undisclosed 1,170.00 36.53 Hong Yu Construction Highwealth Construction

Residential

Starry9 1,035 550.00 17.17 Taiwan Life Insurance GIANT CIRCLE LIMITED

Retail

Cashboxparty KTV retail building 2,295 3,000.00 93.66 Yuan Yi Co., Ltd CathayLife Insurance

Industrial Offi ce

E-park Industrial Offi ce Building 8,048 2,816.00 87.92 Chailease Finance Co., Ltd. Cathay Life Insurance

Asia Plaza 34,787 11,503.00 359.13 CPI ASIA MIRROR Shin Kong Life Insurance

A LIMITED

No. 550 Ruiguang Road industrial offi ce 8,411 3,000.00 93.66 Taiwan Life Insurance Shin Kong Life Insurance

/7�/8..

97�/8.8

/7�/88/

97�/88*

/7�/88,

97�/88:

/7�/88;

97�/88.

/7�*)))

97�*))/

/7�*))9

97�*)),

/7�*))-

97�*));

/7�*))8

)<

,<

.<

/*<

/-<

*)<

*,<

*.<

<��

�#0�10�0"�13�#"��#��#"��#3�1�(10 ��1&�#213# 1��$

�213"0 ��0"�131��3#�1�

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

<��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

3��55�'� 0��3��

�#0�10��3��13�>�>01�&�

Source: Colliers

Source: Central Bank of the Republic of China (Taiwan)

Note : 1 ping = 3. 3 sq m : US$1 = NT$ 32.03



EXECUTIVE SUMMARY


Note: US$1 = Yen 92.13

JAPAN - TOKYO

Land values in Tokyo continued to fall across the board, although the pace of

decline narrowed. The overall demand for office space remained weak and

most companies continued to go for cost-saving options, including downsizing and

negotiating a better rental rate for their existing premises, rather than relocating.

As a result, the average vacancy rate for Grade A office space had edged up to a

high of over 7% by the end of 2009.

The JREIT market remained difficult and office capital values continued to

fall. However, the local Government remained supportive of JREITs with such

measures as clarification of the tax rules for mergers, tightened standards for

listings and the creation of a public/private fund to support lending. Given this

continued support, a number of mergers are expected to take place in the first

half of 2010.

In the sales market, overall activity was slow, particularly in 3Q2009. No

property was acquired by JREITs in 3Q2009 for the first time since the JREIT

was introduced in September 2001. In 4Q2009, a few properties were traded

between JREITs and institutional investors, but most developments were

transacted between JREITs and their related companies. Secured Capital Japan

acquired Pacific Century Place Marunouchi, which was defaulted by the DaVinci

fund, for a lump sum of about JPY140 billion. This was the largest transaction

in 2009, even larger than the sale in May 2009 of AIG’s headquarters in Japan

for JPY115.5 billion.

Looking ahead, the majority of investors will continue to wait on the sidelines for

clear indications of a recovery in both the economy and the real estate market.

As such, the current bid-ask spread, in particular for quality assets, will remain

wide at least over the near term.

,7�/88.

*7�/888

,7�/888

*7�*)))

,7�*)))

*7�*))/

,7�*))/

*7�*))*

,7�*))*

*7�*))9

,7�*))9

*7�*)),

,7�*)),

*7�*)):

,7�*)):

*7�*))-

,7�*))-

*7�*));

,7�*));

*7�*)).

,7�*)).

*7�*))8

,7�*))8

)<

/<

*<

9<

,<

:<

<��

?#�#"�/)=>1#3� �213"�1"��"&�>01�&�

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

/<

*<

9<

,<

:<

-<

;<

<��

3��55�'� 0��

��>��3��13�>�>01�&�

Source: Colliers

Source: Bank of Japan


(sq m) (Yen billion) (US$million)

Offi ce

Nihon Jisho Daiichi Building 25,561 13.50 146.53 SPC of Simplex Investment Hulic

Advisor

Pacifi c Century Place Marunouchi 81,752 140.00 1,519.59 SPC of Davinci Advisor Secured Capital Japan

Shinsaibashi Urban Building 25,839 24.40 264.84 Kansai Urban Banking Keihanshin Real Estate

Hankyu 27,369 10.20 110.71 Hankyu REIT, Inc. GK Kairos Funding

Residential

Park Axis Tatsumi Stage 22,480 7.46 81.02 Mitsui Fudosan Co. Ltd. Nippon Accomodation Fund

Park Axis Toyosu 34,806 14.30 155.22 Mitsui Fudosan Residential Co. Ltd. Nippon Accomodation Fund

Proud Flat Kamata II 5,316 2.98 32.35 Nomura Real Estate Nomura Residential Fund

Development Co. Ltd.

Urban Stage Nihonbashi Yokoyamacho 6,898 3.53 38.32 Tosei Co. Nomura Residential Fund

Fraser Place Howff Shinjuku West Tower 17,929 6.50 70.55 SPC of Re-plus Orix Real Estate

Retail

Cinema and Sports building and mall 107,413 12.00 130.25 A domestic institution investor SEB Asset Management

building of Aeon Maall Chiba New Town

Tsutaya Fukuoka Tenjin 4,532 3.70 40.16 Undisclosed Frontier Real Estate

Investment Co.




(Pyung) (KRW billion) (US$ million)

Offi ce

Cheongjin 8-block(development site) 15,646 390.00 334.91 G-well E&C London Capital Advisores

(LCA)

SK Soonwha Bldg 6,586 92.20 79.18 Samsung Life Insurance RREEF Spezial Invest GmbH

Samsung Life Insurance Bldg.-Naeja 13,008 52.01 44.66 Samsung Life Insurance Samsung Investment Fund

Insong Building 8,562 121.90 104.68 DNDS KOKREF 15 CR-REITs

Pacifi c Tower 8,786 152.00 130.53 Mirae Asset Maps AM Dohwa Consulting Engineers

M Tower 23,289 47.67 40.94 Mirae Asset Maps AM Individual

Maps Songpa Tower 7,045 67.31 57.80 Mirae Asset Maps AM Hansol Texile

Samsung Life Insurance Bldg.-Nonhyun 21,773 73.89 63.45 Samsung Life Insurance Samsung Investment Fund

Woori Bank Jamsil Center 21,309 210.00 180.33 Woori Bank Jamsil Project Finance Group

Dongyang Securities Bldg 42,346 169.71 145.74 RREEF Investment Samsung Investment Fund

E-Land Gasan Building 11,979 49.00 42.08 E-Land KR-3 CR-REITs

MBC Business Cneter 6,881 92.00 79.00 Foundation for Broadcast Culture KTB Asset Management

Seohyun Building 4,994 44.68 38.37 HSB Property 1 ABS Standard Chartered Korea

First Bank

Neowiz Building 4,822 65.00 55.82 Kookmin Bank Neowiz

Retail

Newcore Gangnam Shopping mall 14,542 220.00 188.92 E-Land Group Newcore Gangnam CR-REITs

SOUTH KOREA - SEOUL

The real estate investment market was active in the second half of 2009, with

the market seeing a record high lump sum price of KRW1,843 billion during

3Q2009. In terms of unit price, the deal translated into an average of KRW5.43

million per sq m, surpassing the previous high seen in mid-2008.

By district, the GBD recorded the highest levels in terms of the size of total floor

area and the lump sum price. Meanwhile, there was only one case in the YBD.

In 4Q2009, overall activity slowed, with only four deals completed during the

period.

Domestic buyers remained the key group of players in the marketplace during the

second half of 2009, while only four cases including one purchase via a domestic

REIT were sold to foreign investors. In addition, real estate funds accounted for

the largest slice of the pie during 2H2009. It was noted that competition was

getting stronger and the focus continued to be placed on prime buildings by both

institutions and funds. Meanwhile, a number of occupiers have been looking to

acquire mid-sized premises.


*7�/888

,7�/888

*7�*)))

,7�*)))

*7�*))/

,7�*))/

*7�*))*

,7�*))*

*7�*))9

,7�*))9

*7�*)),

,7�*)),

*7�*)):

,7�*)):

*7�*))-

,7�*))-

*7�*));

,7�*));

*7�*)).

,7�*)).

*7�*))8

,7�*))8

)<

/<

*<

9<

,<

:<

-<

<��

��31#��#�1�3#�14;=&#>�31�@3��#�1�3#�16

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

<��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

3��55�'�

�1�@��3��13�>�>01�&�

Source: Ministry of Land, Transport and Maritime Affairs, Republic of Korea

Source: Bank of Korea

Note : 1 Pyung = 3.306 sq m : US$1 = KRW 1,164.5



EXECUTIVE SUMMARY

INDONESIA - JAKARTA

The overall property market in Jakarta was slow in 2009, notwithstanding the

signs of recovery in the last quarter of 2009. Due to the smooth presidential

election and the gradual improvement of the regional economy, property rentals

largely held firm, although individual landlords remained flexible on lease

negotiations.

Benefitting from the continued improvement of the external environment, the

local office market witnessed an increasing number of lease enquiries in the private

sector. However, the bulk of the occupiers acted cautiously, waiting for more

positive signs to emerge from both the local political and economic fronts.

Of the various property sectors, in terms of both rentals and occupancy, the

local office market experienced immediate growth over the second half of 2009

due to a revival of lease enquiries and the relatively small new supply coming

on line in 2010.

The retail sector will have to put a lot more effort into this year in order to perform

better, particularly because of the large amount of vacant space and continued

supply projection in the future, and the relatively slow activity among retailers

taking space. The big hope is for the apartment sector. It has been indicated that

the government will revise the regulation that limits foreign ownership, giving

foreigners property ownership for up to 75 years upfront instead of the current 25

years (subject to extension). Currently, with numerous vacant units available in

the market, the apartment market is very much relying on this regulation because

local buyers are now becoming limited. In short, we believe that 2010 will offer

much hope for the property industry to perform better than in 2009.

Given a positive projection for GDP growth over 2010 and a much better

outlook in 2011, we believe that the property market will show positive growth

in 2010. Some positive economic indicators seen early in the year include the

strengthening Rupiah against the US Dollar, relatively steady occupancy rates,

low interest rates and, more importantly, signs that foreign investors are starting

to eye and invest in Indonesia.

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�#"��0"&�"1�0#�3#�1

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

/.<

<��

3��55�'� 0��3��

?#�#3�#��3��13�>�>01�&�

Source: Colliers

Source: Bank of Indonesia



PHILIPPINES - MANILA

The second half of 2009 was a lot better than the first. On the commercial

front, demand shows signs of an imminent recovery over the next six months.

However, despite minimal activity in the construction of office space in Makati

CBD, there remains a glut of office space in the market. Vacancy rates are still on

the rise as more space becomes available in many parts of Metro Manila. Rents

for office spaces went down by a total of 20%-25% over the past 18 months, but

expectations point to stable rents in 2010.

In the residential segment, sales take-up of ongoing residential projects in

Metro Manila outperformed expectations. As a result, developers boosted their

developments in the pipeline by launching new residential projects for both the

luxury and the middle income markets. The bullish sentiment of developers

moving forward is highlighted by strategic land acquisitions in various locations

in Metro Manila and the provinces. Some developers are also being aggressive in

expanding their business by entering other segments of the market. For example,

Ayala Land formed a new group, Amaia, that will offer affordable housing projects

and Robinsons Land signalled its entry into the luxury residential segment by

launching a Makati CBD project called Signa Designer Residences.

Average rents for luxury condominiums in Makati CBD continue to correct

slightly as the result of a slight glut in supply. Demand for overall supply in the

secondary rental market remains soft in non-CBD locations.

What will be interesting to see moving forward is the implementation of the

highly anticipated local Real Estate Investment Trust (REIT) law, which was

passed in December 2009. With the implementing rules and regulations likely

to be released in 1Q2010, REITs will open up opportunities for the industry to

finance more projects in the commercial, retail, hospitality, residential and leisure

segments of the market.

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

/.<

��0�0��0"1��31213�1�31�@3��#�1�3#�14�213"0 ��6

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

�55�'� 3��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

/.<

<��

�#"0�#��3��13�>�>01�&�

Source: Colliers

Source: Central Bank of Philippines


(Hectares) (Peso billion) (US$ million)

Offi ce / Residential

Bonifacio North 8.38 3.15 67.97 Bases Conversion and Megaworld Corporation

Development Authority

Quezon City 29.00 6.00 129.43 National Housing Authority Ayala Land, Inc.

(Joint-venture agreement)


Note : US$1 = Peso 46.356



EXECUTIVE SUMMARY

SINGAPORE

On the back of the recent nascent economic recovery seen in Singapore,

the loosening of credit and improved market sentiment, the property

investment sales market garnered a total investment in sale transactions of S$8.92

billion in the second half of 2009, representing nearly three times the level tallied

in the second half of 2008, in the aftermath of the global financial crisis.

There was a noticeable increase in the number of deals at and above the S$100

million band in 2H2009, with a total of 15 such transactions registered during

the period. One of the largest deals was the S$541.9-million acquisition of the 99-

year leasehold Clementi Mall from the Government by a joint venture involving

Singapore Press Holdings, NTUC FairPrice Co-Op and NTUC Income Insurance

Co-Op. Another was Frasers Centrepoint Limited’s injection of the S$342.5-

million Alexandra Technopark, a high-specifications industrial development

into Frasers Commercial Trust.

In the second half of 2009, the Government announced that it will reinstate the

Confirmed List1 for residential and industrial property development under its

Government Land Sales (GLS) programme for the first half of 2010. However, it

will not introduce any commercial, hotel or white sites to the List over this period,

preferring to maintain hotel, commercial, residential, commercial/residential

and white sites on the Reserve List2for 1H2010.

Going forward, in line with the modest economic recovery foreseen for the key

global economies, the pick-up in investors’ sentiment and confidence, which

began in the second half of 2009, is likely to continue into 2010. Coupled with

the unfreezing of the global credit market, the presence of cash-rich investors

who are likely to raise exposure of their portfolios to property investment, as well

as the availability of property investment options at corrected price levels, the

investment sales market in 2010 is expected to outperform that in 2009.


Development Floor Area Lump Sum Price Seller Buyer (sq ft) (S$ million) (US$ million) Commercial - Offi ce Prudential Tower - 6 fl oors / Cecil Street 67,300 106.29 75.74 APF Property Investments (S) K-REIT Asia Pte LtdAviva Building / Cecil Street 67,708 65.00 46.32 Aviva Sommerville Development Residential Development Site / Dakota Crescent 647,599* 329.00 234.43 Urban Redevelopment Authority UOL GroupDevelopment Site at Former The Parisian / 137,519* 283.00 201.65 Overseas Union Enterprise China Sonangol Land Pte LtdAngullia ParkDevelopment Site / Jalan Senang/Lengkong Tujoh 434,700* 158.00 112.58 Lee Tat Developmemt Hoi Hup and Sunway GroupCommercial - Retail Clementi Mall / Commonwealth Avenue West / 193,750 541.90 386.13 Housing Development Board Singapore Press Holdings andClementi Avenue 3 NTUC FairPrice Co-Op and NTUC Income Insurance Co-OpKatong Mall / East Coast Road 172,170 247.55 176.39 Tuan Sing Holdings Perennial Katong Retail TrustIndustrial Alexandra Technopark / Alexandra Road 1,048,607 342.50 244.05 Orrick Investments Pte Limited Frasers Commercial TrustSoon Hock Holding Logistics Building / 444,043 43.00 30.64 SH Cogent Logistics Mapletree Logistics TrustPenjuru Close

/7�/8..

,7�/8..

97�/8.8

*7�/88)

/7�/88/

,7�/88/

97�/88*

*7�/889

/7�/88,

,7�/88,

97�/88:

*7�/88-

/7�/88;

,7�/88;

97�/88.

*7�/888

/7�*)))

,7�*)))

97�*))/

*7�*))*

/7�*))9

,7�*))9

97�*)),

*7�*)):

/7�*))-

,7�*))-

97�*));

*7�*)).

/7�*))8

,7�*))8

)<

/<

*<

9<

,<

:<

-<

;<

.<

8<

<��

/)<

�0" #��31�9�=0"�13�#"�

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

/.<

<��

3��55�'� 0��3��

�0" #��31��3��13�>�>01�&�

Source: Colliers

Source: Monetary Authority of Singapore

Note: US$1 = S$ 1.4034* Potential gross fl oor area

1. Sites on the Confi rmed List are released for tender at a pre-determined date without the need for the sale to be triggered by an application. The number of sites on the Confi rmed List in each GLS programme will depend on market conditions, the strategic need for certain sites to be developed and other factors.

2. On the Reserve List, the Government will release a site for sale only if an interested party submits an application for the site to be put up for tender with an offer of a minimum purchase price that is acceptable to the Government. The successful applicant must undertake to submit a bid for the site in the ensuing tender at or above the minimum price offered in the application.



THAILAND - BANGKOK

The overall investment market remained weak during the second half of

2009 due to the prevailing uncertainty about the political environment in

Thailand. The current uncertainty on the approval of various environmental

regulations for the Map Ta Phut Industrial Estate has cast a shadow over industrial

investment in Thailand.

Overall, the registered capital of applications submitted for investment approval

fell nearly 6% year-on-year (YoY) from THB418 billion to THB393.2 billion during

the period between January and November 2009 and there was a reduction in

investment flow from foreign investors. For example, investment from Japan

declined 44% YoY to THB54.6 billion, although demand attributed to local

investors was relatively strong.

Foreign Direct Investment (FDI) in real estate stood at THB6.89 billion in

3Q2009, representing a fall of 36% YoY. Going forward, the prospective role of

FDI in the local real estate market will remain largely uncertain.

No new property stocks were listed on the Stock Exchange of Thailand (SET)

during the second half of 2009. However, the Thanasiri Group became the

first property developer to list on SET’s Market for Alternative Investment. The

company specialises in landed housing projects in Nonthaburi and Phuket, and

has a registered capital of THB255 million.

Four new property funds were listed on the SET during the second half of 2009.

TPARK Logistics Property Fund (TLOGIS) is worth THB1.533 billion and will

invest in land, warehouses and cold storage facilities at Ticon Logistics Park.

Sala@sathorn Property Fund has invested in the Sala@sathorn office building

and is worth THB1.67 billion. The MFC Strategic Storage Fund was set up with

a capitalisation of THB608 million and invests in cold storage facilities. The 101

Montri Property Storage Fund, worth THB603 million, invests in warehouse

facilities.



(sq m) (Baht million) (US$ million)

Offi ce

Sathorn Road 2,706 1,000.00 29.98 CIMB Thai Bank Undisclosed

Surawong Road 3,976 500.00 14.99 Leenuttapong Family TCC Group

Sala @ Sathorn, Sathorn Road 2,924 1,649.40 49.44 St. Louise Holding Co.,Ltd. Sala @ Sathorn Property

Fund

Retail

Central Plaza Pinklao, 185,671 5,680.00 170.27 Central Pattana PCL CPN Retail Growth

Boromarajajinani Road Property Fund

Industrial

TICON Logistics Park - Wangnoi and 144,448 1,530.00 45.86 TICON Industrial TICON TPARK Logistics Logistics

Park - Bangna PCL Connection Property Fund

Rama 2 Road, Muang 11,132 142.50 4.27 North Agricultural Co.,Ltd. MFC - Strategic Storage Fund

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

<��

��#0�#"&�9�=�0��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

/.<

<��

3��55�'� 0��3��

�#" ��3��13�>�>01�&�

Source: Colliers

Source: Bank of Thailand

Note: US$1 = THB33.359



EXECUTIVE SUMMARY

VIETNAM - HO CHI MINH CITY

Compared with other major cities in the region, the real estate investment

market in Ho Chi Minh City (HCMC) is currently in the early stages of

development. Regarding market size, the number of investment-grade assets

available for sale to both local and overseas investors has been very limited. For

example, the total size of the Grade A office market in HCMC is 105,000 sq

m of floor area in six buildings. A similar situation is seen in the local serviced

apartment and retail markets. Meanwhile, in the industrial sector, speculative

projects being built for lease are virtually non-existent. Industrial manufactures

usually lease land by paying a capital sum in advance and then build their own

facilities to suit their needs. In addition, market transparency remains an issue

as investment yields are not publicly available and nearly every sales transaction

is regarded as a special purchase.

During the good years before the financial crisis, a number of international real

estate investment trust (REIT) players visited Vietnam and prepared to acquire

local real estate at 7.5%. This reflected a country risk of about 2.5 percentage

points higher than the typical 5% benchmark yields in other cities in the region.

However, yield expectations changed at the beginning of 2008 when inflation

in Vietnam rose as high as 25% per annum. Prospective investors changed their

strategies to acquire distressed assets at yields of no less than 20% per annum.

With market volatility and a lack of real estate assets available for sale, the market

has seen a thin volume of sales transaction over the past four years.

Over the medium term, the local real estate investment market will see yields

falling to between 12% and 15% per annum for prime assets with quality

management. Special purchasers, such as REITS, are willing to accept very low

yields, although distressed asset buyers will anticipate high yields. Prime office

properties available for lease to most international tenants will be on the lower

end of the yield range (i.e. 12%), while industrial properties will show yields of

around 15%. It should be noted that the above range is assumed on the basis

of an international purchaser. Local real estate buyers usually adopt a different

attitude to risk as Vietnamese citizens are permitted to acquire freehold properties.

Foreign investors are allowed to purchase leasehold interests but there remains

uncertainty concerning the security of tenures. From a legal perspective, it is

still unclear whether or not leaseholders have the right to renew after the lease

expires.

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

<��

/-<

201�"#��30�1�0"�131��3#�1

Source: Colliers

)<

/<

*<

9<

,<

:<

-<

;<

.<

8<

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

��B��>��=��=>��

201�"#��31#�� &�� 3�(��

Source: The State Bank of Vietnam



INDIA

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

)<

*<

,<

-<

.<

/)<

/*<>��=��=>��

0"&0#�31#�� &�� 3�(��

Source: Central Statistical Organisation, Ministry of Statistics and Programme Implementation, Government of India

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

/<

*<

9<

,<

:<

-<

;<

.<

8<

/)<

��

0"&0#�31��3#�1

Source: Reserve Bank of India

India’s overall economy showed signs of recovery during the second half

of 2009, with various factors suggesting that the country’s economy has

bounced back and the Finance Ministry projecting a growth in GDP of 7.75%

for 2009-10. Indian industry continued to show robust recovery, with a growth

rate touching a 25-month high of 11.7% in November 2009. The latest foreign

direct investment (FDI) numbers have also shown renewed growth, an indicator

of long-term expectations for the economy. However, a large portion of FDI is

tending to go into sectors where the average capital requirement is also high,

such as the core sectors of real estate and power.

Institutional investors have been actively looking for investment opportunities,

with the residential sector being the most sought after due to encouraging signs

of economic recovery, cheaper entry price levels, lower borrowing costs and the

inherent demand for housing.

The office market also showed signs of recovery, with a revival of leasing activity

during the second half of 2009. India-focused funds, as compared to global funds,

have been more active as many global funds continued to adopt a wait-and-see

strategy. A number of other funds, including Red Fort Capital, Edelweiss, ASK

Investments and ICICI Ventures, have been actively raising funds for local

investment opportunities.

Prompted by the positive signs of economic recovery, a number of realty

companies, including Lodha Sahara Prime City, Emaar MGF and BPTP, filed

draft red herring prospectuses (DRHPs) with the Securities Exchange Board of

India for IPO listing in 1Q2010. Several listed companies, such as DLF, Unitech,

Indiabulls Real Estate, Sobha Developers and HDIL, went in for successful

qualified institutional placements or promoter stake sales and raised over US$2

billion. The ability of listed realty players to raise funds gave privately held firms

the confidence to look into the primary market.

On the policy front, the Reserve Bank of India’s monetary policy gave the directive

to banks to increase standard provisioning norms on loans for commercial real

estate from 0.4% to 1.0%. This represented an increase in interest costs, which

the market perceived as a reduction of funding that will be available to developers

in the future. However, it was regarded as the right pre-emptive move to prevent

the formation of a local real estate market asset bubble.



EXECUTIVE SUMMARY


(sq m) (AUD million) (US$ million)

Offi ce

199 Grenfell Street 5,061 13.75 12.33 Becton Investment Management Private Investor

115 Grenfell Street 13,903 41.00 36.77 Investa Funds Management Local Private Investor

80 King William Street 8,474 21.75 19.51 Trinity Limited Local Private Investor

Retail

Firle Plaza, 171 Glynburn Road 12,143 37.75 33.86 ISPT Firle Property Management

Pty Ltd

Industrial

Allotment 101 Cavan Road & 20,466 15.00 13.45 Celdann Pty Ltd Cavan Property Unit Trust

8-10 Waldaree Street

AUSTRALIA - ADELAIDE

Following an increase in vacancy levels in July 2009 to 4.8%, demand levels

have now begun to stabilise with an improvement anticipated in 2010. In the

early part of 2010, overall vacancy rates will be impacted only by the additional

stock completed in 2009. Currently, an estimated 22,000 sq m remains seeking

pre-commitment in these developments. A modest outlook suggests that there

will be some vacant stock in 1Q2010, resulting in a further increase in overall

vacancy rates to 6.0%-6.5%. By mid-2010, vacancy rates will start to tighten and

are expected to fall back to below 6%.

Development activity will be limited until at least 2011 as the ability to secure

funding for many projects has been difficult. Given this, no new development

projects were announced in 4Q2009. Currently, any future new project will

coincide with tenant pre-commitment, thus helping to keep vacancy rates low

going forward.

On the sales front, institutions continued to unload their portfolios in an attempt

to reduce their overall debt levels, causing a two-fold increase in the number of

sales transactions in 2009. Although only two major investment transactions were

completed in 3Q2009, overall activity is expected to increase in 2010.

In the industrial sector, the overall volume of sales transactions fell in the

second half of 2009 due to the withdrawal of institutions from the buying

arena, notwithstanding the sustained buying interests from a number of private

investors. Given that the same conditions are expected to prevail over the short

term, investment yields for premises located in less-established areas may increase.

Overall, demand for units priced at AU$3 million or below is expected to remain

strong.

Leasing demand remained stable for the traditional inner industrial precincts,

fuelling further rental growth during the second half of 2009. Looking forward,

the market will see an increase in activity in the first half of 2010 if more stock

is released onto the market.


)<

*<

,<

-<

.<

/)<

<��

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

#@��3#�0#��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

�55�'� 0��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

#&1�#0&1��3��13�>�>01�&�

Source: Colliers

Source: Reserve Bank of Australia

Note: US$1 = AUD1.1150






Offi ce

10 Rudd Street 4,736 18.70 16.77 Mirvac Private

4 Marcus Clarke 2,354 9.70 8.70 Cromwell Private

19-25 Moore Street 3,559 12.40 11.12 Becton Private

7-11 Barry Drive 2,375 8.59 7.70 Private Private

82 Northbourne 7,000 44.00 39.46 Private Private

AUSTRALIA - CANBERRA

Investor confidence in the Canberra commercial property market improved in

2009. The completed sales of Industry House, 64 Allara Street and 10 Rudd

Street, impending sale of the ATO Building and 82 Northbourne Avenue, and

improved sentiment from both international and national institutions have

helped narrow the gap between the expectations of vendors and buyers. Prime

office buildings have been particularly sought after due to the security of long-

term government leases and attractive yields.

The outlook for non-contemporary accommodation will be less optimistic and

capital values are expected to fall further, albeit at a slower rate. The market

dynamics have changed, with a widening gap between old and new building

stock in terms of rental values, yields and capital value rates. Tenants in older

accommodation now have greater bargaining power, which will reduce rental

growth and increase incentive levels. Non-market review mechanisms in existing

leases have created a situation where many secondary buildings have passing

income in excess of market levels. This will change as market reviews, renewals

and new lettings take effect, and reduce net income and capital values.

The migration of tenants from old to new stock has caused a sharp increase

in sub-leasing vacancy levels, which have doubled from 1.3% to 2.6% in the

Canberra region. The delivery of new stock without pre-commitments over the

past 12 months has caused vacancy levels to increase for Grade A premises, a

trend that will continue in 2010. However, it will be corrected over the next few

years as new stock absorbs demand from second-tier developments.

The quality of Canberra stock will continue as new developments are completed

over the next few years, in addition to the significant amount that has been

delivered over the past three years. We expect yields to be relatively stable over the

short to medium term and incremental capital growth to be achieved for prime

assets that meet contemporary standards. Secondary assets with inflated passing

rents are likely to experience further capital depreciation over the short term and

might be considered for major refurbishment and/or redevelopment.

)<

*<

,<

-<

.<

/)<

<��

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

#@��3#�0#��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�55�'�

�#"�133#��3��13�>�>01�&�

Source: Colliers





EXECUTIVE SUMMARY

AUSTRALIA - MELBOURNE


)<

*<

,<

-<

.<

/)<

<��

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

#@��3#�0#��3

�55�'� 0��

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�1��@3"1��3��13�>�>01�&�

Due to positive economic results, including positive GDP growth and strong

job growth figures, the Reserve Bank of Australia (RBA) started to increase

interest rates from the lows in October 2009 with three consecutive increases of

25 basis points in October, November and December 2009 to the current level

of 3.75%. The national unemployment rate reached a high of 5.9% in 2009

but declined to 5.5% in December 2009, with many economic commentators

believing that the unemployment rate has now peaked. Strong employment

growth and a substantial growth in house prices put additional pressure on the

RBA to lift rates.

Private and offshore investors dominated the bulk of sales activity in 2009.

Investment sales transactions (on sales in excess of AU$10 million) in Melbourne’s

CBD totalled AU$600 million in 2009. The major highlight in 2009 was the sale

of 15 William Street in June 2009 to Deka Immobilien Investment. The short-

and long-term appeal of the Melbourne CBD office market has been enhanced,

bringing forward demand from active European and Asian groups. The results of

the latest Colliers International Investor Sentiment Survey 3Q2009 also indicate

that investors believe that the market has seen its bottom and is poised for an

upswing as early as mid-2010. In the survey, the Melbourne CBD office market

was identified as one of the top two locations offering the best investment value

over the next 12 months.

Leasing activity levels remained steady during the second half of 2009, with a

number of significant leasing transactions taking place in quality office buildings

as landlords continued to offer attractive incentives. Net office rentals for prime

grade stock remain stable.

In the industrial sector, there was an improvement in both sales and leasing

activity in the second half of 2009. Investment yields for prime assets remained

stable and were at 8.50% as of 4Q2009, while second-tier industrial developments

were between 10% and 11%.



Offi ce

128 Exhibition Street 4,737 18.00 16.14 Undisclosed Salvest Capital

410 Elizabeth Street 6,091 15.00 13.45 Private Undisclosed

350 Collins Street 17,798 51.05 45.78 Orchard Funds Management Prime Value

456 Lonsdale Street 8,427 27.00 24.22 Macquarie Direct Private Investor

Industrial

324 Frankston Dandenong Road 29,042 20.20 18.12 AMP Capital Prime West

1-23 Wirraway Drive 7,915 18.90 16.95 Salta Properties Private Investor

Lot 5, Horsburgh Drive 18,020 22.00 19.73 Undisclosed Private Investor

Source: Colliers





AUSTRALIA - PERTH

)<

*<

,<

-<

.<

/)<

<��

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

#@��3#�0#��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

�55�'� 0��

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�13��3��13�>�>01�&�

Investment sales transactions remained subdued in the second half of 2009, with

four major transactions occurring in the CBD. The largest one was the sale to an

institutional investor of a 50% stake in a fully pre-committed office development.

Uncertainty in the future course of the office market in combination with tight

credit conditions remain the major challenges facing transaction volumes.

Yields for the Perth CBD have stabilised to an average of circa 7.5% after softening

in the first half of 2009. With the rising level of optimism over the past six months,

investment yields may begin to tighten in 2010. Foreign investors continue to

favour Perth as a favourable investment location in Western Australia for supplying

minerals and natural gas to the world.

On the industrial front, the number of investment transactions fell significantly

in 2009. Demand for sizeable developments is apparent in the marketplace,

however limited stock is available for sale. Many investors are looking for bargains

but there are very few distressed assets available over the short term. Yields will

range between 8.0% and 9.5% in 2010 as investors remain largely cautious.

Interest rates in Australia have risen in 2009 and are likely to rise further in 2010

as the Reserve Bank of Australia will act pre-emptively in order to dampen any

uncontrollable inflation. If there is no corresponding growth on the economic

front, the prospective increase in interest rates will result in low investment

activity in 2010.



Offi ce

58 Mounts Bay Road 22,294 95.00* 85.20 Charter Hall Commonwealth Property

Offi ce Fund

6 King Park Road 1,553 10.30 9.24 Finander Pty Ltd Chyreck Nominees Pty Ltd

23 Barrack Street 960 7.50 6.73 MPH Resources Pty Ltd Hire Intelligence

International Ltd

53-55 Ord Street 6,864 41.50 37.22 Cfs Managed Property Ltd Perpetual Corporate Trust

Retail

622- 646 Hay Street 24,076 114.50 102.69 CPT Manager Limited Starhill Global REIT

Industrial

52-64 Sheffi eld Rd 3,639 9.35 8.39 Trust Co of Australia Ltd Argosy Nominees Pty Ltd

Source: Colliers



Note: US$1 = AUD1.1150 * 50% share



EXECUTIVE SUMMARY

AUSTRALIA - SYDNEY


)<

*<

,<

-<

.<

/)<

<��

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

#@��3#�0#��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�55�'� 0��

�>&"1>��3��13�>�>01�&�

After reducing the official cash rate to a 50-year low of 3.00% in April 2009, the

RBA started to move interest rates up from the lows in October 2009 with three

consecutive increases of 25 basis points in October, November and December

to the current 3.75%. These increases occurred due to positive economic results,

including positive GDP growth and strong job growth figures. The national

unemployment rate reached a high of 5.9% in 2009 but declined to 5.7% and

held steady in 4Q2009. Concerns in early 2009 that the unemployment rate would

escalate to between 7% and 8% have abated and the rate is now not expected to

go beyond current levels. Stronger than expected retail sales in November and

December 2009, as well as rising house prices, put additional pressure on the

RBA to lift rates further.

Overall, the second half of 2009 saw a strong increase in sales activity within

Sydney’s CBD, with AU$105 million worth of major office sales taking place in

3Q2009 and a massive AU$808 million in 4Q2009. The major highlight of 2009

was the sale in December 2009 of Aurora Place at 88 Phillip Street to South Korean

National Pension Service. The sale represented the first of a major premium-grade

building in the CBD since the sale of Chifley Tower in 2005. What’s more, at a

sales price of AU$685 million, it was one the largest office sale to take place in

the world since the global financial crisis took hold in 2008.

In the Sydney industrial market, there was an increase in sales and leasing

activity during the second half of 2009 due to an increase in imports and stock

replenishment in the private sector. During 4Q2009, the market saw the first

purchase of an industrial asset by a listed property trust in more than 12 months

when the Dexus Property Group bought 2-4 Military Road, Matraville, for

AU$46 million.



Offi ce

Aurora Place 48,908 685.00 614.35 Commonwealth Property South Korea National

Investment Trust Pension Service

60 Union Street, Pyrmont 19,790 137.00 122.87 Charter Hall AFIAA (Swiss Pension Fund)

20 Hunter Street, Sydney 9,942 77.00 69.06 Grosvenor Australia ACE Trust

234 Sussex Street, Sydney 11,067 46.00 41.26 Stockland Trust Group Private

Industrial

2-4 Military Road, Matraville 30,154 46.10 41.35 AMP Capital Investors Dexus Property Group

2 Quarry Road & 33 James Erskine Drive, 12,897 22.40 20.09 ING Industrial Fund Private Investor

Erskine Park

70-82 Marple Avenue, Villawood 16,339 15.55 13.95 ING Industrial Fund Private Investor

Source: Colliers





NEW ZEALAND - AUCKLAND

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

)C)<

/C)<

*C)<

9C)<

,C)<

:C)<

-C)<

;C)<

.C)<

8C)<

<��

"1(�A1#�#"&��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�55�'� 3�� 0��

#@��#"&��3��13�>�>01�&�


In the office sector, vacancy rates moved up in most CBD precincts, with the

average rate registered at 11.5% in 4Q2009 compared with 8.4% in mid-2009.

Prime-grade office vacancy rates also rose to 11.5% over the same period, up from

5.4% in June 2009. In 2009, typical prime office rents fell to around NZ$330 per

sq m per annum, down 8% from early 2009, as tenants opt for renewals rather

than take new leases. Landlords are agreeing to shorter lease terms and lease

term extensions to increase tenant flexibility, in some cases offering a rent-free

period as part of an incentive package. The sales transactions that have occurred

in the Auckland market have shown the return to the market of private investors

and property syndicates looking to take advantage of cyclical lows. Investment

yields are now between 8% and 9% for typical prime-grade office space and are

expected to remain stable over the next 12 months.

In the industrial sector, the property council/IPD investment index reported

that Auckland industrial investment property returned a total of 2.4% for the

year to September 2009, up from 0.6% in the March 2009 quarter. Industrial

vacancy levels in the Auckland region rose to 6.4% in August 2009 from 4.8%

six months previously and prime market yields stabilised at between 7.75% and

8.75%. Good-quality, well-located properties with secure medium- to long-term

tenants remain in favour, and a number of private investors and high-net-worth

individuals are merging to acquire larger industrial assets.

In the retail sector, prime retail rents stabilised in 4Q2009 after a decline of

around 15% since the beginning of the year. Prime locations, such as lower

Queen Street, still remain retailers’ favourite spots. Due to the stabilisation of

retail spending and the return of consumption confidence, retail investment

sentiment rebounded to the levels seen in early 2009. Prime average retail yields

tightened to around 7% in 4Q2009.

Source: The Reserve Bank of New Zealand


(sq m) (NZD million) (US$ million)

Offi ce

60 Cook & 143 Nelson Streets 4,604 7.68 5.54 Kermadec Property Fund Undisclosed

Aurecon House, 139 Carlton Gore Road 5,929 26.65 19.23 Goodman Property Trust Overseas Investor

Retail

Berkley Cinema & Retail complex, 1,739 7.00 5.05 Kermadec Property Fund Undisclosed

32-34 Anzac Street

Birkenhead Retail Complex, 174 Mokoia Road 1,355 5.90 4.26 Private Owner Private Investor

Rialto Centre & Carlton DFK Tower 7,865 49.00 35.36 National Property Trust Ladstone Developments

Buildings, 135-187 Broadway

Industrial

169 Bush road 6,084 9.40 6.78 Siemens (NZ) Private Investor

(offi ce/warehouse)

10,000 (yard)

38A & 38B Harris Road & 73 Crooks Road 4,497 7.32 5.28 Private Owner Private Investor

11 Dalgety Drive 14,363 11.70 8.44 Property For Industry Corporate Investor

130 Keers Road 6,814 7.40 5.34 Pangani Properties Stuart P C

(offi ce/warehouse)

20,146 (yard)

92-98 Harris Road 7,313 12.34 8.91 Direct Property Fund Private Investor

Source: Colliers

Note: US$1 = NZD1.3856



EXECUTIVE SUMMARY

NEW ZEALAND - WELLINGTON

/7�*)))

97�*)))

/7�*))/

97�*))/

/7�*))*

97�*))*

/7�*))9

97�*))9

/7�*)),

97�*)),

/7�*)):

97�*)):

/7�*))-

97�*))-

/7�*));

97�*));

/7�*)).

97�*)).

/7�*))8

97�*))8

)C)<

/C)<

*C)<

9C)<

,C)<

:C)<

-C)<

;C)<

.C)<

8C)<

<��

"1(�A1#�#"&��3

/7�*)),

*7�*)),

97�*)),

,7�*)),

/7�*)):

*7�*)):

97�*)):

,7�*)):

/7�*))-

*7�*))-

97�*))-

,7�*))-

/7�*));

*7�*));

97�*));

,7�*));

/7�*)).

*7�*)).

97�*)).

,7�*)).

/7�*))8

*7�*))8

97�*))8

,7�*))8

)<

*<

,<

-<

.<

/)<

/*<

/,<

/-<

<��

�55�'�

(1��0" ��"��3��13�>�>01�&�


The CBD office leasing market has experienced a series of rental reductions

since mid-2008, with prime rents now sitting at around NZ$374 per sq m

per annum. The overall vacancy rate increased from 6% in 2Q2009 to 6.7% in

4Q2009, while prime-grade vacancy rates remained stable at around 0.7% and

secondary grade rates rose from 6.7% six months ago to 7.4% in 4Q2009.

Investment yields in the majority of the office precincts remained static in

4Q2009. However, yields have edged up by 25 to 50 basis points in the Core

precinct and investment activity remained active in the sub-NZ$3 million

bracket. The prevailing trend is expected to continue over the next 12 months,

with face office rents dropping by a further 2.4% to the end of 2010. Capital

values are also expected to decline further over the next 12 months on the back

of weakening rents.

In the industrial sector, vendors have been offering a range of lease incentives,

including straightforward rental reductions. These have been more prevalent in

secondary or larger warehouses with floor areas of over 3,000 sq m. Industrial

capital values have been dropping, although the rate of decline has narrowed.

With a further downslide in rentals, industrial capital values will see a further

downward adjustment over the next 12 months.

In the retail sector, the pace of rental decline in the CBD narrowed from 5.1%

in mid-2009 to 4.0% in 4Q2009. With strengthening consumption confidence

and improving market sentiment, the retail market saw a return of investment

demand during 4Q2009. This was particularly the case for properties in the

lower price bracket. Despite the fall in rentals, investment yields were compressed

further to an average of 6.9% and 7.4% in the prime and secondary markets,

respectively, during 4Q2009.

Source: The Reserve Bank of New Zealand

Source: Colliers


(sq m) (NZD million) (US$ million)

Offi ce

15-21 Abel Smith Street 1,320 4.30 3.10 Liquidators of Williams & Smith The Wellington Company

Old Wool House, 139-141 Featherston Street 2,430 5.10 3.68 Hong Polo Stressfactor InvestmentsNote: US$1 = NZD1.3856



This page is deliberately left blank.

Appendix

Major Market NewsContacts



Beijing

The Beijing Municipal Government on 24 June 2009 issued the Implementation of Provisions to Encourage Multinational Corporations to Set up Regional Headquarters in Beijing, corresponding to the Provisions to Encourage Multinational Corporations to Set up Regional Headquarters in Beijing released on 21 May 2009. The act aims at sharpening Beijing’s edge compared to Shanghai, Hong Kong and Singapore, which are also actively creating conditions to attract MNCs’ headquarters. According to the Implementation, MNCs with Asian headquarters newly established in Beijing can benefi t from government subsidiaries of as much as RMB10 million.

Sources from the Beijing Commission of Development and Reform reveal that the Implementation Plan of Restructure and Revitalisation of the Electronic Information Industry in Beijing (‘the Plan’) will soon be offi cially released. According to the Plan, Beijing aims to develop into the information centre city of the Asia Pacifi c region, and a global electronic information industry base. Over the next three years, Beijing will emphasize and strengthen the development of mobile communications, digital television, software and information services, high-generation fl at panel display, integrated circuits, computers, next-generation Internet applications domains, etc. As it suggests in the Plan, the added value of the electronic information industry will account for 15% of Beijing’s GDP, of which the information services and the electronic information manufacturing sectors will contribute 11% and 4%, respectively, by the end of 2011. The government’s initiative will further improve not only the healthy conditions of the local economic structure, but also the competitiveness of the city in the region. In addition, the act will probably catalyse more demand for industrial properties in the medium term (3-5 years).

Beijing’s Haidian District council offi cially released The Circular of Accelerating the Adjustment of Trades in Zhongguancun West Zone on 20 July. According to the Circular, the Haidian local government will encourage technological and creative industries, instead of traditional retail properties such as electronic stores and shopping centres, to develop in the West Zone of Zhongguancun. According to the new act, the Zhongguancun West Zone will be developed into an area consisting of six functional areas, including fi nancial, technology service, high-tech corporate headquarters, R&D centres, creative industries, new product trading and display, and service areas. The action plan of the Circular will be introduced later by the Haidian District Government. The adjustment is expected to foster more demand for offi ce space from high-tech and creative industries in the Zhongguancun West Zone. China’s central bank is still committed to a moderately loose monetary policy, according to Su Ning, deputy governor of the People’s Bank of China (PBOC), at a press conference in Beijing on 7 August. The promise from the government to maintain a moderately loose monetary policy will boost market sentiment, while any changes to government policies will defi nitely reverse the upward momentum of the economy and lead to failure at the mid-point. It should be noted that the PBOC will manipulate slower credit growth rather than a decrease in credit supply, despite the country’s banking loans having recorded nearly RMB7.4 trillion in 1Q09, far higher than the initial full-year target of RMB5 trillion.

On 1 September, The Ministry of Land and Resources (MLR) issued the Notice on Approval for Land Use with Strict Supervision to strengthen the supervision of land for construction and protect rural collective land areas from illegal use. According to the Notice, land areas on which construction has not started upon two years of approval being received will be resumed by the government and labelled a vacant area for further consideration, according to the relevant laws and regulations. In addition, the government will take action on those housing and golf resort projects with illegal property rights, and monitor all processes of land planning, execution, approval, supply and development. This Notice unveils the government’s intention of strengthening land management with statutory policies and preventing land resources from lying vacant and being wasted.

The Ministry of Finance (MOF) will maintain its active fi scal policy during the crucial period of economic recovery, as a solid foundation has yet to be confi rmed, according to fi nance minister Xuren Xie. The government agency will continue to enlarge investment in public expenditure, and strengthen the development and construction of key projects. In addition, the government will carry out structural tax reduction policies, including raising tax rebates and exempting tax for certain exports, in order to boost investment and consumption by reducing the tax burden on corporations and residents.

On 22 September, China’s State Council issued a document with opinions to strengthen support for the development of the country’s Small- and Medium-sized Enterprises (SMEs). According to the latest policy, the Central Government will deepen reforms to the country’s monopoly industries, lower the market access threshold, and create a more open and fair competition environment for SMEs, with more favourable tax breaks, better access to markets and banking loans,

MAJOR MARKET NEWS

Greater China


EXECUTIVE SUMMARY


the overall land supply policy. Delimiting to the segment of commodity residential housing, the land sales area of single plot must not exceed the upper limits of 7, 14 and 20 hectares in small cities (towns), medium-sized cities and large cities, respectively. Apparently, the government intends to nurture a healthier real estate market through the revised land management mechanism.

The State Council on 2 November announced further streamlining of the approval process of foreign investment in the form of joint venture enterprises. According to the new policy, which will take effect on 1 March 2010, foreign-funded joint venture enterprises are eligible to set up a partnership enterprise with registration directly to the registration authority, instead of requiring prior approval from the local commission of the Ministry of Commerce (MOC). The government intends to encourage overseas investors with advanced technology and management experience to set up joint ventures, aiming at promoting the development of modern service industry and other related sectors in the country.

According to the State Council Executive Meeting on 9 November, chaired by Chinese Premier Wen Jiabao, China will further strengthen the incentives on domestic consumption and continue to maintain most of the pace of current policies through next year, in order to achieve stable and rapid economic growth. As for the real estate sector, most of the favourable housing policies, such as the 20% down payment and discount mortgage rate on fi rst home buyers, will remain the same in 2010, except that the business tax exemption for second housing will be limited to more than fi ve years, instead of a two-year holding period.

The consor tium of MOF and four other government agencies on 17 December circulated the notice on further strengthening the transfer payment management of land transactions. According to the notice, the instalment payment

and stronger government aid for technological innovations. The action aims to drive a new source of economic growth that will sustain China’s recovery.

According to the Ministry of Land Resources (MLR), the government recently approved the revised edition of the Beijing Municipal Overall Land Use Master Plan from 2006 to 2020 and stated that Beijing will strictly manage land for construction, especially in urban areas, and also maintain rural land construction areas in good order for infrastructure construction. According to the latest plan, urban and suburban land construction areas in Beijing will be capped at the upper limit of 270,000 hectares by 2020, of which urban land construction areas will be limited to 77,800 hectares. In 2009, Beijing plans to have about 4,000 hectares of new construction area and offer a total land supply of 5,700 hectares.

The Beijing Municipal Government released the Action Plan of Promoting the Beijing’s Southern Areas and Accelerating Its Development on 5 November. According to the Plan, the local government will invest over RMB50 billion in infrastructure projects in Beijing’s southern areas over the next three years. This will bring a total estimated investment of RMB290 billion from both the public and private sectors. In addition, the Plan also reveals that a total of seven subway lines, covering 188 km, will be completed in the region and several motorways linking to the south-west of Beijing, including Jingshi Motorway II, will be constructed within fi ve years, which should benefi t the further promotion and development of such business parks as the Lize Financial Business District of Beijing, the Zhongguancun Fengtai Science Park and the Daxing Bio-medicine Industry Park in the precinct. The Ministry of Land and Resources (MLR) on 10 November circulated the Notice on “The Directory of Projects with Restricted Land Use (the Revised Edition of 2006)” to further tighten

Greater China

period of the total land price shall not exceed one year in principle, and the down payment shall not be less than the 50% of the total price for the developer. The new down payment policy for land transactions, along with the 5.55% business tax on selling houses within the fi ve-year holding period, reintroduced two weeks ago, aims mainly to curb speculation in the national real estate market.

The Ministry of Finance on 22 December announced the new package on property sales tax, effective from 1 January 2010. Owners have to pay taxes levied on the sales price if a non-common house is held for less than fi ve years; owners only have to pay taxes levied on the profi t if a non-common house is held for at least fi ve years, or that of a common house for less than fi ve years; and owners pay no property sales tax if a common house is held for at least fi ve years. This clarifi cation on the property sales tax is a response to the 5.5% tax on sales of homes by the State Council on 9 December, and is aimed at curbing speculation in the housing market.

Chengdu

Effective on 1st January 2010, the down payment for land acquisition increased from 20% to 50% and the term of capital gain tax on the sale of housing properties was revised upwards from 2 years to within 5 years of purchases.

MAJOR MARKET NEWS



Greater China

Guangzhou

On 9th December 2009, the government introduced policies to prevent overheating in the real estate market, changing the levy exemption from two to fi ve years with effect from 1 Jan 2010, with the aim of discouraging speculative investment.

On 17th December 2009, fi ve ministries, the Ministry of Finance, the Ministry of Land Resources, the central bank, the Ministry of Supervision and the Audit Commission jointly issued the “Circular on Tightening of Land transfer revenue and expenditure management notifi cation”. It aims to strictly tighten deposits on land, which should not be less than 50% of the total value.

Shanghai

In December 2009, State Council issued a number of policy directives to curb speculation in the residential and land markets. The required holding period of residential property by an individual to qualify for business tax concession reverts from two years back to fi ve years. Measures will also be implemented to increase the effective supply of ordinary housing and support home purchases for self-use or upgrading. On the land sale market,

MAJOR MARKET NEWS

the Ministry of Finance adopted regulations to strengthen management on settlement of land premium. The initial instalment of land premium is raised to 50% and full payment has to be settled in one year under normal circumstances.

The above policy initiatives were targeted specifi cally at the residential and land sale markets and basically did not touch upon commercial property and service apartments. Given the abundant liquidity in the market and a sanguine market outlook, investment sales activities are expected to remain active in the foreseeable future.

Hong Kong

In view of the continued structural change in demand for industrial properties, the local government has introduced various measures over the past few years to help boost the use of vacant or under-utilised industrial premises.

In October 2009, the Secretary for Development elaborated on a new package of measures proposed by the government to facilitate the redevelopment and wholesale conversion of industrial buildings, which will become effective on 1st April 2010. The most notable measure for facilitating the redevelopment of industrial buildings is the lowering of the threshold for owners of industrial buildings in non-industrial zones and those aged 30 years or above from 90% to 80% to apply to the Lands Tribunal for compulsory sale for redevelopment. In addition, in order to facilitate the conversion of industrial buildings for other uses, owners can apply for a “nil waiver fee” concession if the following criteria are satisfi ed:

(1) The industrial buildings are aged 15 years or above and located in “Industrial”, “Commercial” or “OU (Business)” zones

(2) The application is made jointly by all owners of the buildings

(3) There will be no increase in building height, bulk or gross fl oor area after conversion

(4) The building cannot be reverted to industrial use during the waiver period

(5) The full market premium is payable when the building is redeveloped in the future

Except for lower ing the threshold for application under the Land (Compulsory Sale for Redevelopment) Ordinance, which will be implemented via subsidiary legislation on a permanent basis, applications for the other measures must be made within a three-year period from 1st April 2010.

Taipei

The real GDP rebounded from -1.29% QoQ in 3Q 2009 to 6.89% QoQ in 4Q 2009. As the global economy saw some improvement, the trading sector, including exports and imports, gained momentum and recovered from -20.86% QoQ and -29.52% QoQ respectively in 3Q 2009 to 16.86% QoQ and 16.21% QoQ respectively in 4Q 2009. During the second half of 2009, the home mortgage loan increased from NT$4.77 million July 2009 to NT$4.88 million in November 2009, up by 2.24% during the period. Meanwhile, the construction loan Index edged up slightly by 0.73%, from NT$0.98 million in July 2009 to NT$0.99 million in November 2009.


EXECUTIVE SUMMARY


North Asia

Tokyo

The Democratic Party of Japan won the general election on 30th August 2009 after long domination by the Liberal Democratic Party over the past 16 years.

The Japanese Market saw an improved economy, with real GDP increased by 0.3% QoQ and 1.2% YoY in 3Q 2009. Meanwhile, public investment, exports and production were also on the upward trend. However, the rate of growth is expected to moderate as economic fundamentals remain weak, for example, with a high unemployment rate of over 5%. The momentum is not strong enough to underpin a full recovery.

In December 2009, Bank of Japan introduced a new fund-supplying operation to encourage a further decline in long-term interest rates at 0.1% for three months, bringing the total amount of loans approximately to ¥10 trillion, in order to overcome defl ation and a sustained growth in price stability.

Seoul

Korea recorded a positive economic growth after three consecutive quarters of decline, with GDP growing by 0.73% YoY in 3Q 2009 and 6.29% YoY in 4Q 2009.

In anticipation of a rise in the benchmark interest rate in 2010, investors will tend to seek any assets enjoying low interest rates. Moreover, the tax reduction for acquisition and registration and the heavy tax levy waiver for real estate fund and REITs will continue until 2012, which will facilitate more investment using these vehicles.

MAJOR MARKET NEWS



South Asia

Manila

SM Development Corp. acquired three new properties in Mandaluyong, Manila, worth close to P2 billion to support the company’s aggressive expansion. The company bought a one-hectare property near Welcome Rotonda in Quezon City, where it plans to build two residential condominiums under the Sun Residences brand. Meanwhile, Jazz Residences, located on a two-hectare lot along Jupiter Street in Makati City, is planning to build four residential towers on the lot. The third acquisition is located on a two-hectare property in Mandaluyong City, near the Boni Station of MRT 3, where the company plans to build Light Residences.

Looking ahead, other projects scheduled for launching in 2010 are Princeton Residences in Quezon City, located beside Gilmore LRT-2 Station along Aurora Boulevard, and Wind Residences in Tagaytay City.

The Real Estate Investment Trust measure is now a law (RA 9856), after President Arroyo allowed the 30-day period to lapse within which to veto the bill. To encourage investments in REITs, the REIT law provides certain tax incentives to the REIT. However, the REIT must be listed with a stock exchange and maintain its status as a listed company and annually release at least 90 percent of its distributable income to shareholders.

Singapore

Singapore’s GDP expanded by 3.5% YoY in 4Q 2009, bringing a full year contraction of 2.1% YoY in 2009. Looking ahead, the government now expects the economy to expand by between 3% YoY and 5% YoY in 2010.

The Singapore government made moderate downward adjustments to development charge (DC) rates, effective from 1 September 2009. On average, the DC rates for commercial land use were cut by 4.0%, rates for non-landed residential use decreased by 2.0%, and those for hotel/hospital and business zone commercial uses were trimmed by 4.0%.

The Government had removed the Interest Absorption Scheme (IAS) and Interest-Only Housing Loans (IOL), with effect from 14 September 2009.

The Government will also not extend the following January 2009 Budget assistance measures for the property market when they expire. This includes:

MAJOR MARKET NEWS

• Allowing a one-year extension of project completion period for existing Government residential sale sites and private residential projects by foreign housing developers with Qualifying Certifi cates (QC);

• Allowing re-assignment of Government Land Sales (GLS) sites and private land owned by QC holders;

• Allowing up to two years of property tax deferral for land under development;

• Offering QC holders up to four years to dispose all private residential units in the development; and

• Allowing QC holders to rent out unsold private residential units for a maximum of four years.

On the 6th November 2009, the Government announced the reinstatement of the Confi rmed List for 1H 2010 GLS Programme to ensure that there will be adequate land supply for housing development.

Under the GLS programme, a Confirmed List comprising eight residential sites for the development of 2,925 housing units will be released. The government will also maintain a Reserve List, with a total of 16 residential sites and two mixed-use plots, which will bring a supply of 7,625 units. Both the Confi rmed and Reserve Lists can potentially bring 10,550 housing units into the market. This is the highest supply in the half-yearly GLS programme since the Reserve List system began in 2H 2001.

The Government will also resume the Confi rmed List for industrial land sales, with two sites, which can potentially yield some 1.34 million sq ft of industrial space. Eight sites will also be maintained in the Reserve List for industrial use in the fi rst six months of 2010.


EXECUTIVE SUMMARY


Bangkok

Thailand’s economy rebounded in 3Q 2009, with the GDP rate of decline narrowing from 7.1% YoY in 1Q 2009 and 4.9% YoY in 2Q 2009 to 2.8% YoY in 3Q 2009. On a quarterly basis, an increase of 1.3% QoQ was recorded in 3Q 2009. The Bank of Thailand predicted the economy to grow in the range of 3.3%-5.3% in 2010. Meanwhile, the state planning agency NESDB forecast GDP to expand by 3-4% and Reuters expects a 3.5% growth in 2010.

Core infl ation remained stagnant with only a negligible 0.3% YoY rise in 2009. Meanwhile, the headline infl ation (including food and energy prices) entered the negative region of 1.9% YoY in 2009. The Bank of Thailand’s Monetary Policy Committee is likely to keep its one-day repurchase rate at 1.25% in 1H 2010, in order to encourage the delicate momentum that is taking root in the economy.

South Asia

MAJOR MARKET NEWS

No commercial, hotel or white sites are added to the Confi rmed List for 1H 2010. However, two new hotel plots are added to the Reserve List. The Reserve List will comprise fi ve commercial sites, two white sites, 10 hotel sites and one commercial-and-residential site. These sites can potentially yield 4.50 million sq ft (gross fl oor area) of commercial space and 4,515 hotel rooms.

Interest Absorption SchemeThe IAS is a housing loan payment scheme offered by a housing developer and his partner bank(s) to buyers of uncompleted housing units. The IAS allows purchasers who, after paying the upfront downpayment, to defer making any further installment payments until the units are completed, i.e. issued a Temporary Occupation Permit (TOP). The purchaser would take up a loan with the developer’s partner bank to buy the property under the IAS. Prior to TOP, the bank will require only interest payments to be made on the loan and these payments will be paid by the developer. The borrower will start making regular installment payments on the loan only after TOP.

Interest-Only Housing LoansThe IOL is a housing loan whereby the borrower makes only interest payments on the loan for a period of time, with no repayments of the loan principal. For uncompleted properties, the interest-only period could be from the inception of the IOL to TOP of the project. (If an IOL is offered under an IAS scheme, the developer pays the interest instead of the borrower in the interest only period). Compared to payments under a standard payment scheme, installment payments under an IOL in the interest-only period are lower, but as the loan principal is not paid down during this period, subsequent installment payments may be higher when servicing of the principal resumes.



INDIA

MAJOR MARKET NEWS

Economy

The Reserve Bank of India (RBI) moved to hike the statutory liquidity ratio (SLR) and increase the provisioning norms for advances to the commercial real estate sector. The provisioning requirement for loans to commercial real estate has been increased from 0.4% to 1%. Some analysts commented that interest rates are still at their lowest in recent times, and even a marginal hike due to this tightening in provisioning will not seriously affect the overall sector. Rather, it might help, as the central Bank is trying to curb the formation of an asset bubble. In other words, it is trying to control the asset prices for end users. Indeed, in some cities property prices have gone up by 5-15 percent in past 2-3 months. If well implemented, this policy will benefi t property buyers in the long run.

The Reserve Bank of India (RBI) has made it easier for banks to lend to special economic zones (SEZ). Several types of advances to projects in special economic zones have now been excluded from the defi nition of commercial real estate loans. In the circular issued on Wednesday, RBI has sought to defi ne a commercial real estate loan as one where the funds are used to acquire real estate and the repayment of the loans is out of proceeds of sale or rentals from the property. Bearing these conditions in mind, RBI has sought to differentiate between loans that could be classifi ed as CRE exposures and those that were not. Kotak Realty Fund, a real estate private equity (PE) fund from Kotak Mahindra Group, will invest Rs 270 crore to acquire stakes in a Mumbai-based realty fi rm and a slum rehabilitation project and a Bangalore-based developer. The fund will spend Rs 100 crore to acquire a 60% stake in Star Light Developers Pvt. Ltd and another Rs 100 crore for 50% of the slum rehabilitation project undertaken by Ackruti City Ltd near Mumbai’s international airport. It will also spend Rs 70 crore to purchase a 60% stake in Bangalore-based Lalith Gangadhar Constructions Pvt. Ltd.Canada-based NRI billionaire Bob Dhillon is all set to make a foray into India. Dhillon’s Canadian

real estate company, Mainstreet Equity, which owns more than 6,000 rental properties across Canada, is likely to set up a billion-dollar India-specifi c real estate fund to mark its entry into the Indian real estate market.

Between April and October 2009, the total FDI infl ow stood at $17.64 billion, almost 6% lower than the corresponding period in 2008. Meanwhile, foreign investments fl owing into the services sector (fi nancial and non-fi nancial) fell by about 7% YoY, to $3,121 million, during April- October 2009. Among other major sectors, housing and real estate development witnessed a 12.5% YoY surge in FDI infl ows, to $2,056 million, during the same period. The FDI into construction totalled $1,565 million during the same period in 2009 (against $1,742 million a year ago).Aimed at promoting low-cost housing, the government has launched an interest rate subsidy scheme that could help a home loan borrower save up to Rs10,000 in EMIs, provided the cost of the house is less than Rs20 lakh. In other words, the interest subvention scheme of 1 percent will apply on all individual housing loans up to Rs10 lakh for units costing up to Rs20 lakh. The interest rate subsidy scheme will be offered at a one-year period from 1st October 2009 to 30th September 2010.


EXECUTIVE SUMMARY


Australasia

MAJOR MARKET NEWS

Australia

The release of positive economic indicators in 4Q 2009 revealed that the Australian economy fi nished the year stronger than expected, thanks to the stimulus measures put in place by the federal government and increased commodity exports, leading to recovery. During 3Q 2009, GDP expanded further by 0.5%. The most recent forecasts from Access Economics suggest that GDP growth is expected to accelerate to 2.5% in 2010 and 3.5% in 2011.

The unemployment rate peaked at 5.8% in October 2009, and the latest fi gures showed a decline to 5.5% in December 2009. The market experienced strong job growth, with the total number in employment up by 35,200 in December 2009, of which full-time employment rose by 7,300 jobs and part-time employment grew by 27,900.

During 4Q 2009, The Reserve Bank of Australia was the pioneer among central banks to lift its offi cial cash rate by 25 basis points, from 3.00% in September 2009 to 3.75% in December 2009. The recent string of positive economic results, such as strong jobs growth and retail spending fi gures, further supports the forecast that the Reserve Bank will lift the offi cial cash rate to 4.00% in February 2010.

New Zealand

After fi ve consecutive quarters of contraction in the New Zealand economy, gross domestic product (GDP) increased 0.2% in the June 2009 quarter and economic activity maintained a same pace of growth during the September quarter. For the year ended September 2009, GDP contracted 2.2% compared with the year ended September 2008.

Total export volumes increased 4.7% in the June 2009 quarter, mainly driven by an increase in exports of dairy products (up 20.9%). Total import volumes were down 3.8%, with intermediate goods (down 6.1%), and capital goods (down 3.5%) making the largest contributions.

The Consumer Price Index (CPI) fi gure recorded an increase of 1.3% in the September 2009 quarter, up from 0.6% in the June quarter. Seven out of 11 groups increased, with transport (up 3.1%), food (up 1.7%), and housing and household utilities (up 0.7%) making the most signifi cant contributions. On an annual basis, infl ation, as measured by the CPI dropped to 1.7% in the year ending September 2009 year. Annual CPI infl ation is currently well within the target band of 1% and 3% and is expected to remain below 2% until early 2011 and track within the target range over the medium term.

In response to recessionary pressures, the Reserve Bank of New Zealand (RBNZ) expanded liquidity facilities by progressively lowering the Offi cial Cash Rate (OCR) by 575 basis points since mid 2008 down to 2.5%. In light the uncertainty remaining around the durability of New Zealand’s economic expansion the RBNZ is expected to leave the OCR rate unchanged for at least another six months.The labour market weakened further in the September 2009 quarter. According to Statistics New Zealand the unemployment rate rose to 7.3% in the December 2009 quarter from 6.5% in the September quarter.



For further details, please contact:

Beijing, China502 Tower W3 Oriental PlazaNo 1 East Changan AvenueDongcheng DistrictBeijing 100738

John WongDirector, Investment & Project DepartmentTel : 86 10 8518 1578Email : [email protected]

Chengdu, ChinaRoom L 16F City Tower86 Section One Renmin Nan RoadChengdu 610016

Jacky Tsai General ManagerTel : 86 28 8620 2128Email : [email protected]

Guangzhou, ChinaRoom 702 Teem Tower 208 Tianhe RoadGuangzhou 510620

Eric LamGeneral ManagerTel : 86 20 3819 3988Email : [email protected]

Shanghai, China16F Hong Kong New World Tower 300 Huaihai Zhong RoadShanghai 200021

Betty WongDirector, Investment Services & Special Projects - East China Tel : 86 21 6141 3529Email : [email protected]

Hong Kong, HKSARSuite 5701 Central Plaza18 Harbour Road Wanchai, Hong Kong

Antonio WuRegional Director / Head of HK Investment & Retail ServicesTel : 852 2822 0733Email : [email protected]

Taipei, Taiwan49/F TAIPEI 101 TOWER No 7 Xin Yi Road Sec 5 Taipei 110

Charles HuangDirector, Investment SalesTel : 886 2 8101 1150Email : [email protected]

Tokyo, JapanHalifax Building 8F, 16-26Roppongi 3-ChomeMinato-ku, Tokyo 106-0032

Christopher ParrySenior Investment AdviserTel : 813-5563-2180Email : [email protected]

Osaka, JapanSumitomo Seimei Kawaramachi #2 Building8-4, Kawaramachi 4-chome Chuo-kuOsaka, 541-0048

Brett JensenAccount ManagerTel : 81 6 6232 0790Email : [email protected]

Seoul, South Korea10F. Korea Tourism Organization Bldg.10 Da-dong, Jung-gu, Seoul 100-180

Jay YunSenior Director & General ManagerTel : 82 2 6740 2001Email : [email protected]

GREATER CHINA NORTH ASIA


EXECUTIVE SUMMARY


Jakarta, IndonesiaWorld Trade Centre, 10th Floor Jalan Jenderal Sudirman Kav 29-31 Jakarta 12920

Mike BroomellManaging DirectorTel : 62 21 521 1400 ext 131Email : [email protected]

Manila, Philippines10/F Tower 2 RCBC Plaza6819 Ayala Avenue cor. Sen. Gil J Puyat AvenueMakati City 1200

Ieyo de GuzmanDirector, Investment SalesTel : 632 888 9988Email : [email protected]

Singapore 1 Raffl es Place#45-00 OUB CentreSingapore 048616

Ho Eng JooExecutive Director, Investment SalesTel : 65 6531 8618Email : [email protected]

Bangkok, Thailand17/F Ploenchit Center 2 Sukhumvit Road Klongtoey, Bangkok 10110

Nukarn SuwatikulSenior Manager, Investment & AdvisoryTel : 662 656 7000Email : [email protected]

Ho Chi Minh City,VietnamBitexco Building, 7th Floor19-25 Nguyen Hue StreetDistrict 1, Ho Chi Minh City

KP SinghManaging DirectorTel : 84 83 827 5665Email : [email protected]

Mumbai, India31-A, 3rd Floors, Film Centre68, Tardeo RoadMumbai 400 034

Joe VergheseManaging DirectorTel : 91 22 4050 4500Email : [email protected]

Melbourne, AustraliaLevel 32, Optus Centre 367 Collins Street Melbourne VIC 3000

John MarascoManaging Director, Investment SalesTel : 61 3 9612 8830Email : [email protected]

Sydney, AustraliaSydney CBDLevel 12, Grosvenor Place225 George StreetSydney, NSW 2000

John KennyChief ExecutiveTel : 61 2 9257 0222Email : [email protected]

Jon ChomleyNational Director, Investment SalesTel : 61 2 9257 0236Email : [email protected]

Auckland, New ZealandLevel 27, 151 Queen StreetPO Box 1631, Auckland 1140

John GoddardDirectorTel : 64 9 356 8837Email : [email protected]

SOUTH ASIA INDIASOUTHEAST ASIA AUSTRALASIA

The content of this report is for information only and should not be relied upon as a substitute for professional advice, which should be sought from Colliers International prior to acting in reliance upon any such information. The opinions, estimates and information given herein or otherwise in relation hereto are made by Colliers International and affi liated companies in their best judgement, in the utmost good faith and are as far as possible based on data or sources which they believe to be reliable in the contest hereto. Notwithstanding, Colliers International and affi liated companies disclaim to the extent permitted by law, any liability in respect of any claim which may arise from any errors or omissions or from providing such advice, opinions, judgement or information.

Colliers Macaulay Nicolls Inc., and certain of its subsidiaries, is an independently owned and operated business and a member fi rm of Colliers International Property Consultants, an affi liation of independent companies with over 294 offi ces throughout more than 61 countries worldwide.

www.colliers.com

asia pacific real estate investment q4-2009

Documents

greater china

regional overview

north asia

southeast asia

new zealand

p p e n d i xmajor ma

ho chi minh city

hong kong sar