M A R K E T B E AT Retail Q2 2021

YoY 12-Mo. City’s Strong Economic Expansion Continues Chg Forecast Shanghai’s economy continued to expand rapidly in Q2 2021, according to the Shanghai Statistics Bureau, reinforcing growth in consumption and in the retail property market. Citywide retail sales of consumer goods jumped 48.9% y-o-y to reach RMB455.7 billion in the first three months 19.3 of 2021. Five new retail projects entered the market in the quarter, comprising Hengji Xuhui Tiandi and One East in Huangpu , Caohejing Stock (million sq m) Incity Mega in , LaLaport in District, and Shangyouli in Baoshan District. The new completions pushed up total mid- to high- end shopping center stock to 19.3 million sq m. ¥1,976 Rent (PSM/MO) Prime Retail Space Demand Remains Buoyant Demand for prime retail space remained buoyant in Q2 as retailers from varied sectors continued to expand. New international and domestic 9.3% brands also entered the market. Net absorption grew to approximately 350,221 sq m, with the overall vacancy rate in turn edging down 0.12 pp q- Vacancy Rate o-q to 9.25%. Trade mix adjustments and tenant upgrading activities in mid- to high-end mature projects were a key driver of absorption, with luxury, F&B, lifestyle, and auto experience store retailers leading demand. Examples included domestic clothing brand Neiwai’s first experience Source: Cushman & Wakefield East store at Jing'an Kerry Centre, world-famous F&B brand Five Guys’ first mainland China restaurant at Printemps Paris, new energy vehicle maker Research Voyah’s experience store in Hall of the Moon, and Loft’s flagship store in Joy City.

SHANGHAI ECONOMIC INDICATORS Citywide average ground floor asking rent in mid- to high-end retail centers rose 1.5% q-o-q to reach RMB879.6 per sq m per month. In prime JAN – MAR 2021 areas, average asking rents grew 1.4% q-o-q to RMB1,976 per sq m per month. Peak average rent was recorded in the Nanjing West Road submarket at RMB2,532.5 per sq m per month. The and Nanjing East Road submarkets followed, with average rentals standing at YoY 12-Mo. RMB2,266.1 per sq m per month and RMB2,181.9 per sq m per month, respectively. Chg Forecast 17.6% Majority of New Supply to Be in Emerging Areas GDP Growth Looking ahead, ongoing investment in transport infrastructure development and the “Five New Towns” urban plan should continue to attract real estate developers to develop new retail projects in non-prime areas and suburbs. We can currently expect most new retail projects to be concentrated in these emerging areas, with mass-market positioning. This trend may well constrain the city‘s future overall rental growth. 48.9% Total Retail Sales Growth FIVE CORE SUBMARKETS RENT / VACANCY RATE RETAIL SUPPLY PIPELINE BY SUBMARKET

0.3% 2,000 6% 5,000 CPI Growth 4,000 1,900 5% Source: Shanghai Statistics Bureau, Cushman & 4% 3,000 Wakefield East China Research, the forecast is 1,800 based on Oxford Economics 3% 2,000

1,700 (000’ sq m)

2% 1,000 Retail New Retail New Supply RMB/SQM/MO 1,600 1% 0 1,500 0% 2015 2016 2017 2018 2019 2020 2021Q2 Nanjing East Road Nanjing West Road Huaihai Middle Road Rent Vacancy Rate Xujiahui Lujiazui Secondary Submarkets M A R K E T B E AT SHANGHAI Retail Q2 2021

MARKET STATISTICS UNDER CNSTR TILL 2022 OVERALL AVG RENT SUBMARKET INVENTORY (SQM) VACANT (SQM) VACANCY RATE (SQM) (RMB/SQM/MO)* NANJING EAST ROAD 482,060 15,920 3.3% 32,000 2,181.9 NANJING WEST ROAD 544,320 14,876 2.7% 203,145 2,532.5 HUAIHAI MIDDLE ROAD 515,560 30,344 5.9% 0 1,630.2 XUJIAHUI 313,000 7,180 2.3% 231,417 2,266.1 LUJIAZUI 1,029,978 53,250 5.2% 0 1,642.0 OTHERS 16,363,109 1,659,757 10.1% 7,313,479 641.9 SHANGHAI TOTALS 19,248,027 1,781,326 9.3% 7,748,041 879.6 * Rental rates are calculated by NLA and considered as consistently achievable for prime space (usually the ground floor) in major shopping centers, excluding management fee, promotional fee and other fees.

SIGNIFICANT STORE OPENINGS Q2 2021 Shaun Brodie PROPERTY SUBMARKET TENANT SECTOR Head of Business Development Services, Jing'an Kerry Centre Nanjing West Road NEIWAI Fashion East China & Greater China Content Super Brand Mall Lujiazui Descente Fashion 42-43/F, Tower 2, Plaza 66, 1366 Nanjing West Road | Shanghai Joy City Others (Jing’an District) Loft Lifestyle Tel: +86 21 2208 0529 Printemps Paris Huaihai Middle Road Five Guys F&B [email protected] Hall of the Moon Others (Hongkou District) VOYAH Car Experiential Store cushmanwakefield.com About Cushman & Wakefield SIGNIFICANT PROJECTS UNDER CONSTRUCTION Cushman & Wakefield (NYSE: CWK) is a leading global real PROPERTY SUBMARKET EXPECTED OPENING DATE SQM estate services firm that delivers exceptional value for real Raffles City (Hongkou) Others (North Bund) 2021 127,000 estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with approximately 50,000 CITIC Square Nanjing West Road 2021 34,500 employees in over 400 offices and 60 countries. Across Jincangwenhua Nanjing West Road 2021 7,145 Greater China, 22 offices are servicing the local market. The company won four of the top awards in the Euromoney Survey Daning Jiuguang Department Store Others (Jing’an District) 2022 180,000 2017, 2018 and 2020 in the categories of Overall, Agency ITC Phase II Xujiahui 2022 231,417 Letting/Sales, Valuation and Research in China. In 2020, the firm had revenue of $7.8 billion across core services of property, facilities and project management, leasing, capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

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