2012 Global Market report - NAI Global

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Melbourne, Australia Perth, Australia Contact NAI Harcourts Melbourne +61 3 9621 3300 Country Data Area (Sq Mi) GDP Growth GDP 2011 (US$ B) GDP/Capita (US$) Inflation Rate Unemployment Rate Interest Rate Population (Millions) 2,969,907 3.5% $1,297.83 $57,661.88 3.0% 5.1% 4.8% 22.508 Melbourne is said to be the most active commercial market in Australia and the most attractive to offshore investors, with new clients trying to get into the market everyday. Commercial property sales throughout Australia over the Q2 2011 have jumped significantly with offshore buyers accounting for approximately 42% of the investment capital. More than half of this investor money has flowed into Melbourne. The vacancy rate within the Melbourne CBD has continued to reduce as office supply is not readily available yet the demand still remains high. No new office supply is expected to be delivered throughout the remainder of 2011. The effects of the global credit crisis on development have started to abate with new supply scheduled from 2012 onwards. Solid tenant demand is expected to support rents around current levels over the next twelve months. Unemployment sits at 5.1% in Victoria, which is in line with the Australian percentage. Melbourne currently leads the retail property market in Australia. The CBD remains the most favored location for retail property, with most categories in Melbourne outperforming the other cities. Melbourne’s retail market has maintained its status quo during the first half of 2011, however, improvement throughout the remainder of 2011 is unlikely. June retail figures show consumers have remained cautious which has led to a slight rise in vacancy levels, particularly with strip shops heavily fashion orientated. There will be a limit on new supply available for the remainder of 2011 with the majority of new centers opening in 2012 – 2013. Although strip shops have managed to keep their yields and rents stable for the first half of 2011, the second half will see the retail market come under increasing pressure as consumers opt to maintain a cautious approach towards discretionary spending. Over the past twelve months the industrial market has remained stable and is likely to firm towards the end of 2011. There is currently a limit on the availability of quality stock as little development is currently taking place due to financial constraints. With a limited amount of stock available and high demand from tenants, this should result in a further decrease in vacancy rates keeping the pressure on rents to increase for prime assets. Contact NAI Harcourts Metropolitan Perth +61 8 9388 6600 Country Data Area (Sq Mi) GDP Growth GDP 2011 (US$ B) GDP/Capita (US$) Inflation Rate Unemployment Rate Interest Rate Population (Millions) 2,969,907 3.5% $1,297.83 $57,661.88 3.0% 5.1% 4.8% 22.508 While the global economy continues to display nervousness in the US and European regions, the west Australian economy continues to grow on the back of the resources boom. Perth commercial property owners have experienced falling vacancy rates as rents continue to rise. The market continues to be active as companies battle for space particularly on St. Georges Terrace. The office leasing market in the CBD, particularly in the premium sector, has continued to tighten and vacancies are more or less non existent at the top end of the market. There is a reasonable level of new stock coming on stream but much of this will be pre-committed before it is completed. Rents are rising and vacancies falling and tenants with leases expiring in the next 24 months and who require more space need to start their search well in advance. This tightness at the top end of the market is having a knock on effect to lower tiers as some tenants are having to compromise on quality to stay within budgets. The suburban market is of course equally as active and vacancy levels are also tightening significantly as activity continues. It is expected that more tenants will look to pre-committing to suburban stock as rents rise in the CBD, fueling office development in the suburbs. On the investment front, institutions, foreign funds and private buyers are all active although change in yields in this sector have not been noticed at this stage, possibly a sign of the weakness in the global economy and the new supply expected in the next 12 to 24 months to enter the market. The industrial investment sector remains relatively buoyant and activity levels in all price ranges continue to be well supported. Industrial leasing also remains stable and small and large requirements come to the market consistently. The retail market should be seen to be the most fragile where there is more evidence of shoppers looking rather than spending and this is affecting the turnover and therefore performance of many of the retailers. This has translated into affecting rental levels, and the retail investment market also would be considered quieter than the office and industrial sectors. Melbourne At A Glance conversion 0.97 aud = 1 us$ RENT/M 2 /YR US$ RENT/SF/YEAR low High low High Vacancy doWntoWn offIce New Construction (AAA) Class A (Prime) Class B (Secondary) suburban offIce New Construction (AAA) Class A (Prime) Class B (Secondary) IndustrIal Bulk Warehouse Manufacturing High Tech/R&D retaIl Downtown Neighborhood Service Centers Community Power Center Regional Malls Solus Food Stores deVeloPment land Office in CBD Land in Office Parks Land in Industrial Parks Office/Industrial Land - Non-park Retail/Commercial Land Residential AUD 500.00 AUD 550.00 $ 47.89 $ 52.68 3.00% AUD 400.00 AUD 500.00 $ 38.31 $ 47.89 4.00% AUD 300.00 AUD 350.00 $ 28.73 $ 33.52 4.00% AUD 270.00 AUD 300.00 $ 25.86 $ 28.73 3.00% AUD 270.00 AUD 280.00 $ 25.86 $ 26.82 2.00% AUD 220.00 AUD 220.00 $ 21.07 $ 21.07 5.00% AUD 150.00 AUD 160.00 $ 14.37 $ 15.32 5.00% AUD 130.00 AUD 140.00 $ 12.45 $ 13.41 8.00% AUD 160.00 AUD 160.00 $ 15.32 $ 15.32 2.00% AUD 800.00 AUD 900.00 $ 76.62 $ 86.20 3.00% AUD 550.00 AUD 600.00 $ 52.68 $ 57.47 4.00% N/A N/A N/A N/A N/A AUD 700.00 AUD 750.00 $ 63.76 $ 68.31 3.00% N/A N/A N/A N/A N/A low/m 2 High/m 2 low/acre High/acre N/A N/A N/A N/A AUD 150.00 AUD 160.00 $ 595,126.86 $ 634,801.99 AUD 130.00 AUD 150.00 $ 515,776.61 $ 595,126.86 AUD 120.00 AUD 130.00 $ 476,101.49 $ 515,776.61 AUD 1,000.00 AUD 1,200.00 $ 4,172,023.37 $ 5,006,428.05 AUD 1,300.00 AUD 1,400.00 $ 5,423,630.38 $ 5,840,832.72 Perth At A Glance conversion 0.97 aud = 1 us$ RENT/M 2 /YR US$ RENT/SF/YR low High low High Vacancy doWntoWn offIce New Construction (AAA) Class A (Prime) Class B (Secondary) suburban offIce New Construction (AAA) Class A (Prime) Class B (Secondary) IndustrIal AUD AUD AUD AUD AUD AUD 550.00 AUD 500.00 AUD 450.00 AUD 500.00 AUD 400.00 AUD 300.00 AUD 850.00 750.00 500.00 600.00 500.00 350.00 $ 52.68 $ 47.89 $ 43.10 $ 47.89 $ 38.31 $ 28.73 $ 81.41 $ 71.83 $ 47.89 $ 57.47 $ 47.89 $ 33.52 8.00% 6.00% 10.00% 5.00% 5.00% 6.00% Bulk Warehouse Manufacturing AUD AUD 90.00 AUD 90.00 AUD 100.00 100.00 $ $ 8.62 8.62 $ $ 9.58 9.58 N/A N/A High Tech/R&D retaIl AUD 100.00 AUD 110.00 $ 9.58 $ 10.54 N/A Downtown AUD1,000.00 AUD3,500.00 $ 95.78 $ 335.21 N/A Neighborhood Service Centers Community Power Center Regional Malls Solus Food Stores AUD AUD 350.00 AUD N/A 250.00 AUD N/A 600.00 N/A 400.00 N/A $ 33.52 N/A $ 23.94 N/A $ 57.47 N/A $ 38.31 N/A N/A N/A N/A N/A deVeloPment land low/m 2 High/m 2 low/acre High/acre Office in CBD Land in Office Parks Land in Industrial Parks Office/Industrial Land - Non-park Retail/Commercial Land Residential N/A N/A N/A N/A AUD 350.00 AUD 500.00 $ 1,460,208.18 $ 2,086,011.69 AUD 160.00 AUD 550.00 $ 667,523.74 $ 2,294,612.85 AUD 300.00 AUD 550.00 $ 1,251,607.01 $ 2,294,612.85 AUD 1,500.00 AUD 3,000.00 $ 6,258,035.06 $12,516,070.11 N/A N/A N/A N/A 2012 Global Market Report n www.naiglobal.com 31
Sydney, Australia Beijing, China Contact NAI Harcourts Sydney +61 2 9380 8665 Country Data Area (Sq Mi) GDP Growth GDP 2011 (US$ B) GDP/Capita (US$) Inflation Rate Unemployment Rate Interest Rate Population (Millions) 2,969,907 3.5% $1,297.83 $57,661.88 3.0% 5.1% 4.8% 22.508 The Reserve Bank of Australia is expected to keep cash rates unchanged in the last quarter of 2011 and has indicated the cash rate may fall moving into 2012 due to the uncertainty in global markets having a knock on effect in Australia. The New South Wales local economy may provide some resilience to the downturn with the new state government attempting to stimulate the economy particularly in Sydney through infrastructure spending. Office leasing activity in the CBD and metropolitan areas has been stable throughout the year without being spectacular. With 160,000 SM of new space coming on to the market this year in the CBD, vacancies will probably increase but with little new supply next year this increase will be short lived. More concerning will be strength of demand on the back of the weakening in economic conditions. Unemployment has risen slightly during 2011 but most notably in the manufacturing sector. While job advertisement no’s are down universally with limited supply before 2014, the Sydney CBD office market is expected to see growing returns for inventors as a result of improving effective rents. Industrial markets continue to see reasonable levels of activity but again concerns stem from the immediate economic downturn more than other factors affecting the market. New supply in the west and south west will mean activity is likely to be centered there with a trend towards warehouse activity as manufacturing has significantly contracted, largely as a result of the high value of the Aussie currency. Activity is generally favored in leasing transactions, perhaps related to more generic requirements of warehousing versus manufacturing. Investment activity has remained steady, with the biggest impediment to investment and new construction still being the availability of credit. The Outlook remains steady however with the NSW government focusing $66.5 billion dollars on infrastructure spending which will enhance transport links for better movement around the metropolitan areas for private and business users alike. Retail leasing markets continue to struggle on the back of weaker economic conditions; this trend is likely to continue into 2012 with the expected continued economic slowing down. 2011 has seen households focus on mortgage repayments and savings over retail spending. On a positive note, unemployment remains at low levels, the economy is still predicted to grow and interest rates cuts will deliver more discretional spending capacity. Contact NAI Curzon +852 2180 6308 Country Data Area (Sq Mi) GDP Growth GDP 2011 (US$ B) GDP/Capita (US$) Inflation Rate Unemployment Rate Interest Rate Population (Millions) 2,969,907 3.5% $1,297.83 $57,661.88 3.0% 5.1% 4.8% 22.508 Beijing’s real estate investment increased by 14.5% yearon-year in the first eight months of 2011 to RMB 188.17 billion (US $29.40 billion). With strong investment and speculative demand from institutional investors, the capital value of office and retail properties recorded double-digit growth in 2011. However, with a number of cooling measures imposed by the government on both the commercial and residential property market, it is expected momentum in the property sales market may be subdued in 2012. The commercial leasing market was strong in Beijing in 2011, triggered by office expansion from international corporations. During Q3 2011, new office space was quickly absorbed by companies with aggressive expansion plans in Beijing. Class A office prices increased by 11% in Q3 2011, quarter-on-quarter, to RMB 330/SM per month (US $51.6). Sale prices of Class A office space increased 7% to RMB 46,951/SM (US $7,340) during the same period. Vacancy rates are expected to remain level between 5% and 10% in 2012. Available office space is mainly in high-end properties, which is a driving force to increase the average asking rental rate. Lack of affordable office space is expected to continue until 2013, increasing further throughout 2012. To stimulate consumers to spend money, market intelligence believes the government is planning to reduce tariffs for luxury products in China up to 15%. Demand for retail space remained sustainable. From January to August 2011, sales of consumer goods amounted to RMB 437.48 billion (US $ 69.5), an increase of 11.1% year-on-year. At the end of Q3 2011, the overall shopping center inventory provided up to 5.4 million SM of retail space to the market. The overall average vacancy reached 11% in Q3 2011, dropping 2.3% quarter-on-quarter. Continued growing demand from retailers and international brands drove the asking rental rate to between RMB 600 and RMB 1,200/SM per month (US $93.8 to $187.5) as of September 2011. In the residential market, tightening of government control is expected to continue for the long run, particularly in highend residential markets. The average rental rate for residential properties reached RMB 160/SM per month (US $25) in Q3 2011, representing a decrease of 4.3% quarter-on-quarter. The vacancy rate declined from Q1 2011 to 8.4% in Q3 2011, representing a decrease of 4.2% quarter-on-quarter. The average price of luxury residential properties was at RMB 41,700/SM (US $6,520) as of Q3 2011. In 2012, both the rental and capital value of luxurious residential properties is expected to maintain at a steady level. Sydney At A Glance conversion 0.97 aud = 1 us$ RENT/M 2 /YR US$ RENT/SF/YEAR low High low High Vacancy doWntoWn offIce New Construction (AAA) Class A (Prime) Class B (Secondary) suburban offIce New Construction (AAA) Class A (Prime) Class B (Secondary) IndustrIal Bulk Warehouse Manufacturing High Tech/R&D retaIl AUD AUD AUD AUD AUD AUD AUD AUD AUD 900.00 600.00 420.00 400.00 370.00 220.00 85.00 78.00 180.00 AUD AUD AUD AUD AUD AUD AUD AUD AUD 1,300.00 800.00 620.00 550.00 450.00 340.00 145.00 180.00 275.00 $ $ $ $ $ $ $ $ $ 86.20 57.47 40.23 38.31 35.44 21.07 8.14 7.47 17.24 $ $ $ $ $ $ $ $ $ 124.51 76.62 59.38 52.68 43.10 32.56 13.89 17.24 26.34 2.60% 6.00% 9.00% N/A 7.00% 9.00% N/A N/A N/A Downtown AUD 6,100.00 AUD 13,000.00 $ 584.23 $ 1,245.08 N/A Neighborhood Service Centers AUD 400.00 AUD 2,000.00 $ 38.31 $ 191.55 N/A Community Power Center AUD150.00 AUD 700.00 $ 14.37 $ 67.04 N/A Regional Malls Solus Food Stores AUD 1,100.00 N/A AUD 3,800.00 N/A $ 105.35 N/A $ 363.95 N/A N/A N/A deVeloPment land low/m 2 High/m 2 low/acre High/acre Office in CBD Land in Office Parks Land in Industrial Parks Office/Industrial Land - Non-park Retail/Commercial Land Residential N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Beijing At A Glance conversion 6.83 rmb = 1 us$ RENT/M 2 /MO US$ RENT/SF/YR low High low High Vacancy doWntoWn offIce New Construction (AAA) RMB 350.00 RMB 540.00 $ 57.13 $ 88.14 7.50% Class A (Prime) RMB 300.00 RMB 360.00 $ 48.97 $ 58.76 6.40% Class B (Secondary) suburban offIce New Construction (AAA) Class A (Prime) RMB 250.00 RMB 120.00 RMB 100.00 RMB RMB RMB 300.00 180.00 140.00 $ $ $ 40.81 19.59 16.32 $ $ $ 48.97 29.38 22.85 4.30% 11.90% 6.30% Class B (Secondary) IndustrIal Bulk Warehouse Manufacturing High Tech/R&D retaIl RMB RMB RMB RMB 60.00 76.00 60.00 25.00 RMB RMB RMB RMB 100.00 131.00 80.00 60.00 $ $ $ $ 9.79 12.41 9.79 4.08 $ $ $ $ 16.32 21.38 13.06 9.79 14.50% 30.00% 18.00% 20.00% Downtown RMB 1,100.00 RMB 1,800.00 $ 179.55 $ 293.81 10.00% Neighborhood Service Centers RMB 250.00 RMB 750.00 $ 40.81 $ 122.42 22.00% Community Power Center RMB 200.00 RMB 800.00 $ 32.65 $ 130.58 20.00% Regional Malls RMB 1,000.00 RMB 2,800.00 $ 163.23 $ 457.03 24.00% Solus Food Stores RMB 182.00 RMB 730.00 $ 29.71 $ 119.15 10.00% deVeloPment land low/m 2 High/m 2 low/acre High/acre Office in CBD Land in Office Parks Land in Industrial Parks Office/Industrial Land - Non-park Retail/Commercial Land Residential RMB 5,000.00 RMB 30,000.00 $ 2,962,564.18 $ 17,775,385.08 RMB 3,700.00 RMB 26,000.00 $ 2,192,297.49 $ 15,405,333.74 RMB 700.00 RMB 1,300.00 $ 414,758.99 $ 770,266.69 RMB 4,157.00 RMB 9,500.00 $ 2,463,075.86 $ 5,628,871.94 RMB 5,500.00 RMB 40,000.00 $ 3,258,820.60 $ 23,700,513.44 RMB 5,500.00 RMB 13,500.00 $ 3,258,820.60 $ 7,998,923.29 2012 Global Market Report n www.naiglobal.com 32
Page 1 and 2: 2012 Global Market report Values, t
Page 3 and 4: n n n table of contents General Inf
Page 5 and 6: Global Outlook US Year in Review As
Page 7 and 8: On the Road to Recovery % of Loss S
Page 9 and 10: 55% (1.1 million) owning and 45% (8
Page 11 and 12: short-term leases, the multifamily
Page 13 and 14: Alberta is home to Canada’s oil a
Page 15 and 16: Office The sovereign debt crisis an
Page 17 and 18: Area Type Q1 2010 Q2 2010 Q3 2010 Q
Page 19 and 20: obust telecom infrastructure and av
Page 21 and 22: egion’s cities. Nevertheless, lea
Page 23 and 24: For 2012, absorption in the commerc
Page 25 and 26: n us Highlights - northeast region
Page 27 and 28: n us Highlights - midwest region n
Page 29 and 30: n us Highlights - West region n Ari
Page 31: Adelaide, Australia Brisbane, Austr
Page 35 and 36: Shanghai, China Shenzhen, China Con
Page 37 and 38: Chennai, India Mumbai, India Contac
Page 39 and 40: Jakarta, Indonesia Tokyo, Japan Con
Page 41 and 42: Christchurch, New Zealand Wellingto
Page 43 and 44: Taipei, Taiwan Ho Chi Minh City, Vi
Page 45 and 46: Calgary, Alberta, Canada Edmonton,
Page 47 and 48: Halifax, Nova Scotia, Canada Ottawa
Page 49 and 50: Regina, Saskatchewan, Canada Contac
Page 51 and 52: The Baltics (Latvia/Estonia/Lithuan
Page 53 and 54: Helsinki, Finland Paris - lle de Fr
Page 55 and 56: Tel Aviv, Israel Almaty, Kazakhstan
Page 57 and 58: Amsterdam, The Netherlands Oslo, No
Page 59 and 60: Moscow, Russia St. Petersburg, Russ
Page 61 and 62: Madrid, Spain Stockholm, Sweden Con
Page 63 and 64: Istanbul, Turkey Kiev, Ukraine Cont
Page 65 and 66: Leeds, England, United Kingdom Lond
Page 67 and 68: Latin America sectIon contents Buen
Page 69 and 70: Rio de Janeiro, Brazil Sao Paulo, B
Page 71 and 72: San Jose, Costa Rica Contact NAI Co
Page 73 and 74: Guadalajara, Jalisco, Mexico Guanaj
Page 75 and 76: Mexico City, Mexico Contact NAI Mex
Page 77 and 78: Saltillo, Coahuila, Mexico San Luis
Page 79 and 80: Lima, Peru Caracas, Venezuela Conta
Page 81 and 82: Birmingham, Alabama Huntsville/Deca
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Little Rock, Arkansas Bakersfield,
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Oakland, California Orange County,
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San Francisco, California Ventura C
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Hartford, Connecticut Wilmington, D
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Fort Lauderdale, Florida Ft. Myers/
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Miami, Florida Ocala/Gainesville, F
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Tampa Bay, Florida Atlanta, Georgia
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Boise, Idaho Southeast (Idaho Falls
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Fort Wayne, Indiana Indianapolis, I
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Des Moines, Iowa Sioux City, Iowa C
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Baton Rouge, Louisiana Lake Charles
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Greater Portland, Maine Baltimore,
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Greater Springfield, Massachusetts
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Minneapolis/St. Paul, Minnesota Jac
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Billings, Montana Bozeman, Montana
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Omaha, Nebraska Las Vegas, Nevada C
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Portsmouth, New Hampshire Atlantic
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Ocean/Monmouth Counties (“Shore M
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Las Cruces, New Mexico Albany, New
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Westchester, New York Asheville, No
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Raleigh/Durham, North Carolina Farg
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Cincinnati, Ohio Cleveland, Ohio Co
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Oklahoma City, Oklahoma Tulsa, Okla
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Berks County, Pennsylvania Bucks Co
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Philadelphia, Pennsylvania Philadel
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Wilkes-Barre/Scranton/Hazleton, Pen
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Sioux Falls, South Dakota Chattanoo
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Memphis, Tennessee Nashville, Tenne
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Corpus Christi, Texas Dallas, Texas
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Houston, Texas Contact NAI Houston
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Salt Lake City, Utah Washington Cou
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Northern Virginia Seattle/Puget Sou
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Madison, Wisconsin Milwaukee, Wisco
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n Glossary n Acre Area of land equa
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